House of Commons

Tuesday 13th May 2014 Commons Chamber

Tuesday 13 May 2014

The House met at half-past Eleven o’clock

Prayers

Tuesday 13th May 2014 Commons Chamber

[Mr Speaker in the Chair]

Business before Questions

Transport for London Bill [Lords]

Second Reading opposed and deferred until Tuesday 10 June (Standing Order No. 20).

Buckinghamshire County Council (Filming on Highways) Bill [Lords]

Lords message (7 May) relating to the Bill considered.

Resolved,

That this House concurs with the Lords in their Resolution.—(The Second Deputy Chairman of Ways and Means.)

Oral Answers to Questions

Tuesday 13th May 2014 Commons Chamber

The Deputy Prime Minister was asked—

[Bob Blackman (Harrow East) (Con)]

1. What recent discussions he has had with his ministerial colleagues on further devolution of power from Westminster and Whitehall.

[The Minister of State, Cabinet Office (Greg Clark)]

I am a member of the local growth committee, which is chaired by the Deputy Prime Minister and brings together Ministers from a wide range of Departments monthly to focus on local growth programmes, including the delivery of the recommendations of the Heseltine review. To date, we have completed 24 city deals and by the summer all 39 local enterprise partnerships, which have submitted their economic plans, will have been assessed and we will make the announcements of local growth deals at that point.

[Bob Blackman]

Further devolution has taken place to Scotland and to Wales, and it has now been a year since the London Finance Commission reported on proposals for devolution to London and the great cities. What progress has my right hon. Friend made in his discussions with Treasury colleagues on devolving property taxes to London and the other great cities of this country?

[Greg Clark]

My hon. Friend is a great champion of empowering our great cities—he is a distinguished leader of a London council—and he knows we have made great progress in this area. He will know that the devolution of business rates, for example, allows London, and other parts of the country, to keep 50% of business rate income. That is worth £3 billion a year to London, and those retained business rates have helped to pay for the £1 billion Northern line extension to Battersea, so this is working in London.

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op)]

May I press the Minister a little more on real devolution to the regions of this country? Yorkshire now has no democratic voice; it has no organisation that strategically focuses on Yorkshire in the coming years. Yorkshire has a bigger population than Scotland, so when can we have that kind of focus and leadership?

[Greg Clark]

The hon. Gentleman is wrong about that. I have a great deal of respect for him but he has not noticed the creation of the combined authority in Yorkshire, which has brought together the councils in the area for precisely that purpose. It has included the signing of a city deal, which has been hailed by the people of Yorkshire, including the leader of Leeds city council, who says:

“This…spells…a fundamental shift in the relationship between Whitehall and the regions. It marks the first steps of a new era”

That will allow the north to “truly control” its “own destiny.” I think the hon. Gentleman should talk to Councillor Wakefield.

[Mr Charles Kennedy (Ross, Skye and Lochaber) (LD)]

Would the Minister concur with the view that in the event of Scotland rejecting the independence option in September, the option of devolving power from Westminster and Whitehall represents a post-referendum way forward—but that it can be only one side of a two-sided coin, with the other being more re-dispersal of power within and across Scotland? The highlands and islands have lost power from Highlands and Islands Enterprise to Edinburgh, from the Crofting Commission to Edinburgh, and over regional and local control of our emergency services. That is not what those of us who were arguing for devolution before some Scottish National party Members were Members of this House had in mind.

[Greg Clark]

The policy and the practice of this Government has been to devolve power from this place to our great cities across the country. I do not think that has been the policy of the Administration in Scotland, who have centralised power and reduced the influence of our great cities north of the border.

[Ms Gisela Stuart (Birmingham, Edgbaston) (Lab)]

City deals are a good start, but if our city regions really want to prosper the time has come to give them the power to levy a supplement on the business rates, as the Mayor of London has.

[Greg Clark]

I am a great fan of the hon. Lady’s efforts to promote Birmingham, which she does very successfully in this House, and to make sure that that great city has the powers and the future that are a tribute to its glories in the past. Through the city deals we are giving more control of the very considerable expenditure that currently is made in Birmingham but which is handled by central Government. If we do that, we can come on to address proposals that Birmingham is making on other matters.

[Stephen Mosley (City of Chester) (Con)]

2. What discussions he has had with the Cheshire and Warrington local enterprise partnership on devolving powers and responsibilities from central Government.

[The Minister of State, Cabinet Office (Greg Clark)]

I met the board members of Cheshire and Warrington local enterprise partnership, including Christine Gaskell and Howard Hopwood, and the council leaders of Cheshire east, Cheshire west and Chester, to discuss their strategic economic plan on 19 March. We are considering their proposals in their plan and expect to make an announcement on the growth deal in July.

[Stephen Mosley]

One project being promoted by the Cheshire and Warrington LEP is electrification of the west coast main line from Crewe to Chester and beyond into north Wales. Does my right hon. Friend agree that that and other such proposals show the importance of LEPs acting as strong local champions for critical infrastructure projects?

[Greg Clark]

My hon. Friend is right, and he is exactly such a strong local champion. As a result of his impressive campaign, that proposal features very strongly in the Cheshire and Warrington strategic plan. I know that it has also attracted attention from Sir David Higgins and his report on HS2, which mentions the case for further improvements east and west, so he is doing a good job. We will be considering those plans over the next few months, but he has made his point very forcefully today.

[Mr David Ward (Bradford East) (LD)]

3. What the Government's policy is on introducing regional Ministers to champion specific areas of the country.

[The Minister of State, Cabinet Office (Greg Clark)]

This Government have instituted the most radical devolution of power and financial autonomy to local councils and community groups for a generation. It is our policy to empower local leaders in cities, counties and districts. Local leaders support that approach. Sir Richard Leese, the leader of Manchester city council, said that there has been more progress on giving cities control of their destiny in three years of this Government than under 13 years of Labour.

[Mr Ward]

I thank the Minister for his answer. Will he now answer the question that I put about regional Ministers, and say what he thinks about that as a way of providing a voice and focus for regions across the piece?

[Greg Clark]

The route we have taken is to empower the leaders of our great cities and counties to provide that leadership of their area. We do not want to send, as the previous Government did, governors-general from Westminster and Whitehall to preside over the regions. That is why our 24 city deals have been based on what local leaders and businesses want; it is their ideas that they have put forward and we back them.

[Mr Nicholas Brown (Newcastle upon Tyne East) (Lab)]

The Government have conceded the principle of territorial Ministers in England with the appointment of the City Minister for Portsmouth. As I understand it, the reason the Government did that was economic development-led. Surely the case for the north-east of England is far stronger, with unemployment rates being higher.

[Greg Clark]

The right hon. Gentleman was a regional Minister in the previous Government. Let me just reflect for a moment on my home town of Middlesbrough. I carry around with me a medallion that was struck to commemorate a statue, publicly unveiled, to the first mayor of Middlesbrough. We are still waiting in Middlesbrough to see a public move to erect a statue to the former regional Minister of the north-east. We want to empower our local leaders, and what we are doing is the right way round.

[Mr Speaker]

I am sure we are all very interested in the Minister’s medallion.

[John Stevenson (Carlisle) (Con)]

I agree with the Minister that this idea of regional Ministers is not the way forward, and that it is important to strengthen local government. Does he agree that there is a place for elected mayors within that?

[Greg Clark]

I do agree with that. Having cited the first mayor of Middlesbrough, Henry Bolckow, and noted that a statue erected by public subscription was made to him, I think that it would be good if we had a rash of them across the country in tribute to the leadership that mayors can play.

[Mr Dennis Skinner (Bolsover) (Lab)]

Does the Minister not realise that devolving power is useless—worthless—if, at the same time, this Government are cutting local government funds by 40%?

[Greg Clark]

That is not the view of council leaders in the hon. Gentleman’s area, who have been extremely enthusiastic about the city deals that have been struck. The chair of the Sheffield city region, in which the hon. Gentleman’s constituency is involved, says that the powers that have been devolved through the city deal will

“drive forward real economic growth and create jobs”

for the whole region, including for the hon. Gentleman’s constituency.

[Priti Patel (Witham) (Con)]

4. What steps he plans to take to reform the system of party political funding and donations to political parties by trade unions.

[The Deputy Prime Minister (Mr Nick Clegg)]

The Government have always been clear that any reform of party political funding is best achieved by consensus. Despite seven meetings, it is disappointing that, as on previous occasions, there has been no agreement between the three parties on beginning party funding reform.

[Priti Patel]

Does the Deputy Prime Minister agree that new laws to restrict the money and influence of trade unions in British political life are required? Will he join the Prime Minister in supporting reforms to strike laws to protect the public from unnecessary industrial action?

[The Deputy Prime Minister]

I certainly agree that all parties need to get big money and vested interests out of party funding. That can best and only be done through consensus. It did not happen this time; I very much hope that all parties will make a commitment that everyone will stick to in the next Parliament.

[John Cryer (Leyton and Wanstead) (Lab)]

Will the Deputy Prime Minister confirm that trade union funding has been given a clean bill of health by three public inquiries, whereas his own party has taken large amounts of money from a convicted fraudster?

[The Deputy Prime Minister]

It is really important that vested interests representing one part of society or another do not dominate the funding of one major political party, as with the Labour party. That does not seem to be right for the Labour party or for the quality of democracy in this House.

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

5. What discussions he has had with the Leicester and Leicestershire local enterprise partnership on devolving powers and responsibilities from central Government.

[The Minister of State, Cabinet Office (Greg Clark)]

I was in Leicestershire on 24 March this year to launch the Leicester and Leicestershire city deal, when I visited the Loughborough university science and enterprise park. The city deal will support the expansion of the science park by opening up new employment land. It will also increase investment in youth employment schemes and give tailored business support.

[Andrew Bridgen]

Last Friday, I spoke at the “North West Leicestershire means business” event at the world-famous Donington Park race track in my constituency. At the event, we heard contributions from the Leicester and Leicestershire enterprise partnership about their efforts to promote economic growth. Will my right hon. Friend outline how he believes the recent city deal will help to promote further economic growth across the county of Leicestershire?

[Greg Clark]

I will indeed. I pay tribute to my hon. Friend for his support for the city deal, which includes not only the city of Leicester but the whole of the county of Leicestershire. One of the features of the city deal proposed by local businesses was to give support and guidance to small businesses that are seeking to expand. Grants of up to £1 million are available to small businesses throughout Leicestershire that have that potential. I know that he drew the scheme to the attention of his businesses and I hope that he will continue to do so.

[Lorely Burt (Solihull) (LD)]

6. What recent assessment he has made of progress on the Government’s policy of decentralisation in England.

[The Minister of State, Cabinet Office (Greg Clark)]

This Government have instituted the most radical devolution of power and financial autonomy to local councils for a generation. After ever-increasing centralisation under the previous Government, we believe that all regions, cities and towns can play a part in securing the economic recovery and in building a better and stronger economy for the future.

[Lorely Burt]

Does my right hon. Friend agree that giving local enterprise greater control over its own destiny has helped to rejuvenate the entrepreneurial spirit of local areas? Will he commend the ambition of Birmingham and Solihull LEP’s strategic economic plan, which aims to create 41,000 jobs for a Government investment of only £86 million next year?

[Greg Clark]

I will indeed commend that ambition. It is appropriate that the enterprise partnership that brings together Birmingham and Solihull has the great good fortune to be led by Andy Street, the managing director of John Lewis and one of the country’s most admired business people. It is fantastic that he is devoting his time to helping the local economy to grow and providing that private sector leadership, which is in marked contrast to the regional development agencies that we had in the past, presided over by governors-general such as the right hon. Member for Newcastle upon Tyne East (Mr Brown).

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

The social economy is becoming an increasingly important driver of innovation and growth. We have 75,000 social enterprises in this country, employing 1 million people, and one in four businesses in the European Union is now a social business. Will the Minister commit in his conversations about city deals and about local enterprise and growth to ensure that social enterprises and the social economy are at the heart of that drive to reinvigorate the regions of this country?

[Greg Clark]

I certainly will. I completely agree with the right hon. Lady. I recall going to Brighton to sign the Brighton city deal in a social enterprise—a hub for start-up tech businesses, brought together by the voluntary and social enterprise sector, that is thriving. Part of the deal was to expand it. That is a model to which I hope other places in the country will aspire.

[Mark Pawsey (Rugby) (Con)]

Does the Minister agree that the Government are right to pursue the principle of decentralisation, because local communities are best placed to make public investment decisions in their area? An excellent example is the Coventry and Warwickshire city deal, building on the strength of the area, which is advanced manufacturing.

[Greg Clark]

I do indeed agree and my hon. Friend was a stalwart in campaigning for the city deal. The people who know and understand their areas best are those who live and work in them. That is the simple principle behind our city deals and the policy of this Government.

[Sadiq Khan (Tooting) (Lab)]

May I thank the Minister for his answers and his commitment to this area in general, which we support? Council leaders of all parties in London and the Mayor of London believe that greater powers, including financial responsibility, should be devolved to London. The Minister answered the question from the hon. Member for Harrow East (Bob Blackman) about business rates—a move that we welcome—in the past tense. Do the Government have any plans to transfer power from Whitehall to city hall and town halls in London?

[Greg Clark]

Yes. I know that the right hon. Gentleman takes a personal interest, as he is hoping to move on from this place to city hall, although he might face a tough fight in doing so. We are committed totally to moving power from here to the city halls and town halls of the country. At the moment, we are negotiating a £2 billion a year transfer of funds from the centre to every city and county across the country, including London, to put control of these resources in the hands of local people rather than officials in Whitehall.

[Yvonne Fovargue (Makerfield) (Lab)]

7. What steps he is taking to improve the accuracy and completeness of the electoral register.

[The Minister of State, Cabinet Office (Greg Clark)]

Individual electoral registration will help to enhance the accuracy of the electoral register by verifying applications against Government records. We will also use data matching to ensure the completeness of the register during the transition to the new system by confirming the vast majority of existing electors. Five national organisations and every local authority in Great Britain are sharing £4.2 million of funding aimed at maximising registration. The introduction of online registration will be of particular help to groups such as overseas voters, students and young people.

[Yvonne Fovargue]

If the Electoral Commission recommends in its report due in 2015 that the move should not go ahead because too many voters have dropped off the register, will the Minister listen to its advice?

[Greg Clark]

With respect, the hon. Lady is bringing together two different points. The Electoral Commission has already said that individual voter registration should proceed, stating:

“We have independently assessed how ready the plans are for this change…and have concluded that it can proceed.”

The decision on whether to close the transition is a decision for the next Government and the Electoral Commission has said that it will provide advice during the next Parliament.

[Stephen Twigg (Liverpool, West Derby) (Lab/Co-op)]

When individual registration was introduced in Northern Ireland, the registration of young people fell dramatically. A duty was then placed on schools and colleges to help register their students and Northern Ireland now has registration rates among young people that are higher than those in the rest of the United Kingdom. Will the Minister introduce a similar duty to apply to schools and colleges in the rest of the United Kingdom so that we maximise the number of young people who are registered?

[Greg Clark]

I welcome the hon. Gentleman’s interest in this matter, as he knows. We have learned the lessons from Northern Ireland and that is one reason we have provided the funding we have to enable groups of people to go into schools and encourage people to register. One of the differences from which we have learned a lesson concerns the importance of online registration, which was not available in Northern Ireland. Our approach to registering young people is to encourage them to register online, and that will be carried out across the country.

[Bridget Phillipson (Houghton and Sunderland South) (Lab)]

T1. If he will make a statement on his departmental responsibilities.

[The Deputy Prime Minister (Mr Nick Clegg)]

As Deputy Prime Minister, I support the Prime Minister on a full range of Government policy and initiatives. Within Government, I take special responsibility for the Government’s programme of political and constitutional reform.

[Bridget Phillipson]

Real wages are down, 1.4 million people are stuck on zero-hours contracts and thousands more families have been forced to turn to food banks. Is that the right hon. Gentleman’s party making a difference in government?

[The Deputy Prime Minister]

The hon. Lady might have forgotten that when we came to power her party had left an absolute economic catastrophe behind. The great Labour recession in 2008 cost every household in this country more than £3,000. Her party predicted that more than 1 million more people would be unemployed when in fact 1.7 million new jobs have been created, of which we are very proud.

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

T5. I know that the Deputy Prime Minister has been somewhat exercised about minimum terms for knife crime, but he must be aware of the repeated guidance of senior judges and the residual discretion that will exist in the proposals to reflect other minimum terms. What is his beef?

[The Deputy Prime Minister]

It is important that sentences fit the circumstances of a crime and that, in seeking to address knife crime, which is a concern that unites the House, we do not unwittingly do something that can lead to higher reoffending rates. As we know from bitter experience, decanting young people into prison for short sentences leads to a revolving door of crime. I want to see less crime, not more, and that is why I want us to be smart, not simply to talk tough on crime.

[Ms Harriet Harman (Camberwell and Peckham) (Lab)]

Not least as a result of difficulties in being able to afford to buy a home, 9 million people are now renting. That figure includes 1.3 million families with children, for whom security and continuity are particularly important. Does the Deputy Prime Minister back our plans to move from one-year tenancies with unpredictable rents, to three-year tenancies with predictable rents? Will he back our proposal to stop letting agencies charging tenants as well as landlords?

[The Deputy Prime Minister]

The right hon. and learned Lady makes an important point about the virtues of longer-term tenancies. We are working on a model tenancy agreement that will support tenants and families who want a longer fixed-term tenancy, and will publish the final agreement in the summer.

Although the right hon. and learned Lady rightly identifies the problem on agencies’ charges, the solution that she suggests may lead to higher rental costs for people renting properties. That is why we will announce today that we will place new obligations on agents to publish with full transparency the fees that they charge, so that people can shop around and get the best deal available.

[Ms Harman]

But transparency is not good enough. We need to be sure that letting agents do not rip tenants off by, as well as charging the landlords, charging the tenants. There will be a vote in the House today. Will he vote with us to protect people in rented accommodation, or will he back the Tories in standing up for the rip-off letting agencies?

[The Deputy Prime Minister]

As I explained, we all share the right hon. and learned Lady’s concern about those charges. We just want to make sure that the solution does not make the situation worse, because once rents go up, they tend to stay up.

The fundamental problem, for which her party bears a heavy responsibility, is that we are simply not building enough affordable homes in this country, and have not done so for a long period. Under the previous Government, fewer social homes were built than under the Thatcher Government. Now, the rate of affordable house building is higher than it has been in the past 20 years.

[Mr Henry Bellingham (North West Norfolk) (Con)]

T6. Does the Deputy Prime Minister agree that consumers deserve to have clear labelling of all halal meat in stores and restaurants? If my constituents go to Pizza Express, they expect the guidance and labelling to be on the menu, not just on the website.

[The Deputy Prime Minister]

I have a lot of sympathy with what my hon. Friend says. Consumers need the right information about the food that they are buying. Some meat is already voluntarily labelled as halal or kosher. This is an issue that provokes strong responses, and for some people it is important that all meat is labelled clearly. We are working with other EU countries to look at the best options for compulsory labelling, to give consumers the choice they want. A study into this matter will finish this summer, and we will review the options then.

[Mr Speaker]

Rosie Cooper is not here. I call Mrs Emma Lewell-Buck.

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

T3. The Deputy Prime Minister claims that he has lowered taxes for poorer households by raising the personal allowance, but will he confirm that the localisation of council tax support is raising taxes for the very worst off?

[The Deputy Prime Minister]

As I said earlier, we inherited a situation in which we needed to restore stability to the public finances, create growth, create employment and create an incentive for people to work. That is why there have been some controversial reforms, but we have also introduced the biggest change in the personal income tax system in a generation, taking 3 million people on low pay out of paying any income tax.

[Annette Brooke (Mid Dorset and North Poole) (LD)]

T7. How big a contribution is the Government’s universal free school meal policy expected to make to social mobility?

[The Deputy Prime Minister]

Despite some claims to the contrary, this policy has been researched and worked on for many years, including two two-year pilots. The evidence shows not only that children get a health benefit from eating more healthy meals and a social benefit as they sit together to share those meals but that the policy is having dramatic effects on closing the attainment gap, which is still too wide in far too many of our schools across the country.

[Paul Blomfield (Sheffield Central) (Lab)]

T4. Last week, I met a disabled Sheffield grandmother who helped her two daughters to stay in work by looking after her grandchildren a few times a week, but two of her three bedrooms were deemed surplus by the Government. In tears, she told me that she could not make ends meet because of the bedroom tax. The Deputy Prime Minister is trying to distance himself from the Conservatives, but why not on the bedroom tax, which was only voted through with his support?

[The Deputy Prime Minister]

As the hon. Gentleman and I have debated in the past, the fact that many families, including in Sheffield, live in overcrowded properties where there is no space for young children to do their homework, and not enough space for people to live in decent conditions, is a fundamental problem. Overcrowding is a real issue, yet we have many other places where people live in social rented accommodation with rooms that they do not need. In some way—I know that the hon. Gentleman wants to put his head in the sand like the rest of his party and does not want to deal with any of these difficult issues—we need to make sense of that, and that is what we are trying to do.

[Jason McCartney (Colne Valley) (Con)]

T8. Cummins Turbo Technologies, David Brown and Huddersfield university have benefited from regional growth fund investment. What plans does the Deputy Prime Minister have for further rounds of that investment scheme, which is sustaining, safeguarding and creating sustainable jobs in my part of west Yorkshire.

[The Deputy Prime Minister]

I congratulate my hon. Friend, who is a great champion of the regional growth fund. I have visited a number of the projects that he mentioned. Rounds 1 to 5 of the regional growth fund have awarded Yorkshire and Humber £270 million across 52 projects and programmes, which is expected to generate 64,000 jobs and private investment of £1.7 billion. There are many examples, as he himself has cited. The next round—round 6—will open this summer, so local bidders will be able to make further bids for regional growth fund money at that point.

[Andy McDonald (Middlesbrough) (Lab)]

T9. At the last election, political parties spent 10 times what third parties spent, so why did the Government choose to clamp down on third parties, which will do very little to take the big money out of politics?

[The Deputy Prime Minister]

I will send the hon. Gentleman the statistics. The amount of expenditure by third parties at election time has increased dramatically. What all of us on both sides of the House want to avoid is an American-style situation in which more and more organisations effectively seek to influence the electoral contest in different areas and constituencies, but do not abide by the same levels of transparency as political parties. All we are doing is saying to people who want to influence the outcome of an election that they need to publish the same amount of information in the same transparent way as we do as representatives of our political parties.

[Andrew George (St Ives) (LD)]

T11. It is very welcome and appropriate that the Government officially recognise that Cornwall has a significant role to play in the celebration of diversity in the UK, but given the Government’s clear desire to devolve, will my right hon. Friend ensure that Cornwall is given the appropriate powers within the EU funding programme to make decisions and drive the programme itself?

[The Deputy Prime Minister]

I share with my hon. Friend the good news that the Government have formally recognised the distinct identity of the Cornish people and, indeed, have provided more support for the teaching of the Cornish language. On the issue of the so-called convergence programme and the management of EU funding programmes in Cornwall, discussions are ongoing. Cornwall will have full input through the growth programme board and through local committees.

[Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

T10. The Government are keen to talk up their investment in cities, but they are doing nothing to ensure that superfast broadband is rolled out properly, with a third of businesses in Shoreditch, where Tech City is, not having access to it. Will the Deputy Prime Minister take that up in government? What will he do about it?

[The Deputy Prime Minister]

If the hon. Lady wishes to write to me about a particular instance in which she feels that progress has not been made, I am more than happy to take that up. As she will know, huge progress has been made in rolling out superfast broadband across the country, but she is right that there are bottlenecks that we are working constantly to alleviate. If she wants to raise any specific instances with me, I am happy to make sure that they are addressed.

[Mel Stride (Central Devon) (Con)]

T12. Given the Deputy Prime Minister’s chairmanship of the Home Affairs Cabinet Committee, does he agree with my right hon. Friend the Prime Minister and the vast majority of the British people that it would be in the country’s best interest to have a net reduction in net migration?

[The Deputy Prime Minister]

As the hon. Gentleman knows, there has been a significant reduction in the number of people coming to our country from outside the European Union. I have never been an advocate of specific net migration figures, because there are many factors—not least freedom of movement across the European Union—over which we do not have any control. I want to have an immigration system that is tough where it needs to be tough. That is why I am a leading advocate of the reintroduction of exit checks—which were removed by previous Governments—so that we can count people out as well as in, but being welcoming to those people who want to play by the rules, pay their taxes and make a contribution to British life.

[Mr Speaker]

I note that the hon. Member for Newport West (Paul Flynn) is sitting in a diagonally opposite position to his usual preferred berth.

[Paul Flynn (Newport West) (Lab)]

T14. It is difficult to hit a moving target, Mr Speaker. There are enormous variations in the numbers registered by electoral registration officers: the best figure is in north Wales, where up to 97% of eligible voters are registered, but it is clear that some areas are not doing the same job. What will the Deputy Prime Minister do to encourage these English laggards to catch up with the splendid example set by Wales?

[The Deputy Prime Minister]

The hon. Gentleman makes an important point. Of course, we need to see the highest rates of registration possible. That is why, as we move towards individual voter registration, there will be several opportunities to transfer people automatically on to the new register and to make sure that there are door-to-door visits by electoral registration officers to give people the opportunity to register properly. I believe we are putting in place all the belt-and-braces measures we can to make sure that registration levels increase.

[Stephen Mosley (City of Chester) (Con)]

T13. Tomorrow, the Chester-based Registered Digital Institute, along with supporting charities such as Childnet, the Internet Watch Foundation and the National Society for the Prevention of Cruelty to Children, will come to Parliament to demonstrate the new friendly wi-fi scheme, which will help ensure that public networks are safe for families and children to use. Will my right hon. Friend support this worthwhile new initiative to improve online safety?

[The Deputy Prime Minister]

I welcome, as no doubt does my hon. Friend, any initiative taken by industry to help parents keep their children safe online. I warmly welcome the initiative that he is involved with tomorrow. The more we can encourage partnership between industry and Government, the police and other agencies, the better for the safety of our children.

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

The outgoing chief executive of the North Eastern local enterprise partnership has said:

“I have six big programmes, most are £100 million-plus, with a six-person team. That simply does not work.”

Does the Deputy Prime Minister agree with those comments and, if so, what are the Government going to do about it?

[The Deputy Prime Minister]

If I understand it correctly, that is an issue about the resources which are allocated in the council to those big projects. One of the answers—the Minister of State, Cabinet Office, my right hon. Friend the Member for Tunbridge Wells (Greg Clark) alluded to this earlier—is ensuring that there is greater devolution, greater control, greater autonomy and freedom to local councils and local areas. That is why the city deal, for instance, has been so warmly welcomed in the north-east.

[Stephen Metcalfe (South Basildon and East Thurrock) (Con)]

Can my right hon. Friend tell the House whether there are any plans to extend into Basildon the £20 million TIGER—Thames Gateway innovation, growth and enterprise—fund currently directed at Thurrock?

[The Deputy Prime Minister]

My understanding is that the proposal to extend the fund is being actively considered now, but no final decision has yet been taken.

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

The Government have hushed up an opinion poll from the taxpayers who paid for it at a cost of £50,000. The poll reportedly shows a surge in support for Scottish independence. Tory and Labour scare stories are not working. There should be no Government secrecy, so will the Deputy Prime Minister be straight with the public on independence and publish that poll? There is no reason that it should be kept secret.

[The Deputy Prime Minister]

I have learned to try to be a bit wary about opinion polls. The only poll that counts is the poll that will take place on 18 September. I very much hope, and people such as me who do not have a vote—those of us south of the border—fervently hope that the Scottish people will decide to remain part of the family of nations that makes up the United Kingdom, because there is so much that we can do together that we simply cannot do apart. That is very much the argument that I hope will prevail on 18 September.

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

Can the Deputy Prime Minister ensure that not just local councils’ work, but economic development through the local enterprise partnership, is centralised? Will he give the House an assurance that York will remain with York, North Yorkshire and East Riding local enterprise partnership?

[The Deputy Prime Minister]

Many of the decisions about exactly where the lines of the maps are drawn in respect of the remit of local enterprise partnerships should, wherever possible, be driven heavily by local consensus—by people agreeing among themselves, rather than having some diktat imposed from above. Inasmuch as my hon. Friend’s view reflects local opinion, which I do not know as well as she does, we would like to reinforce that in Whitehall as well.

[Mr David Hanson (Delyn) (Lab)]

Has not Patrick Mercer’s recent resignation as MP for Newark reinforced the urgent need for measures on recalling MPs, which the Deputy Prime Minister has promised? When will he introduce them?

[The Deputy Prime Minister]

Both the Prime Minister and I have made it clear that we want to proceed with proposals on recall, and when we do they will be properly scrutinised; the early drafts have already been scrutinised by the relevant Select Committee. We are trying to strike the right balance between ensuring that the public feel that they have a right of recall in circumstances in which serious wrongdoing has occurred and avoiding this becoming a sort of kangaroo court arrangement, with people simply seeking to take actions against each other. That is the balance we are trying to strike. We will of course bring forward proposals in due course.

[Zac Goldsmith (Richmond Park) (Con)]

On the same issue, given recent events, does the Deputy Prime Minister still believe that voters will be satisfied with a recall system that is triggered by the Standards Committee, rather than constituents? Does he still believe that, despite recent controversies?

[The Deputy Prime Minister]

As the hon. Gentleman knows, we were quite open in the coalition agreement, right at the beginning of the Government—I know that he does not like this—about feeling that there needed to be some triggers to prove that serious wrongdoing had occurred before recall takes place. I actually have quite a lot of sympathy with his much more radical approach, but I doubt that it would curry much favour across the Floor of the House. I want to get something done, rather than aiming for the stars and ending up with nothing.

[Ian Lucas (Wrexham) (Lab)]

What influence does the £960,800 donated to the Liberal Democrats by the Joseph Rowntree Reform Trust have on Government policy?

[The Deputy Prime Minister]

A whole lot less than the influence the trade unions have on anything asked by Labour MPs in this Chamber.

[Nick de Bois (Enfield North) (Con)]

Further to the answer the Deputy Prime Minister gave my hon. Friend the Member for South Swindon (Mr Buckland), does he recognise the inconsistency of his position on minimum sentencing for knife crime, given that he voted for it in 2011 on amendments I introduced with the Government for mandatory sentencing for knife crime offences?

[The Deputy Prime Minister]

That was for a different offence, as the hon. Gentleman knows. His proposal would make simply possessing a knife an offence, assuming that the individual already has a knife-related offence against their name. In those circumstances, in which judges would have no discretion whatsoever, the proposal could, in my view, lead unwittingly to precisely the revolving door of higher rates of reoffending that we saw time and again under the Labour Government, when endless populist gimmicks led to higher rates of reoffending. One of the things that I am proud of is that this coalition Government, by avoiding that approach, have seen crime fall to the lowest levels ever recorded.

[Jenny Chapman (Darlington) (Lab)]

The Government are not doing nearly enough to move public sector jobs out of London and into the regions. What does the Deputy Prime Minister think we should be doing to move organisations such as the Care Quality Commission and the Human Fertilisation and Embryology Authority to places such as Darlington?

[The Deputy Prime Minister]

I am always open, as are the Government, to proposals on moving further parts of the public sector from Whitehall and London to other parts of the country. Sheffield has benefited enormously from that, with the Department for Work and Pensions and the business bank being established there. The BBC, a public sector body, has had a huge imprint on the north-west. We will of course look at any sensible proposals in the same direction.

[Mr Philip Hollobone (Kettering) (Con)]

In assessing LEP plans from across the country, will the Deputy Prime Minister be kind enough to pay particular attention to the need for an extra junction on the A14 near Kettering, which features in the plans of both the Northamptonshire and South East Midlands LEPs?

[The Deputy Prime Minister]

Any proposal that enjoys the support of not only one local enterprise partnership, but two should of course be considered very seriously, and that is exactly the nature of the consideration being devoted to that proposal.

The Attorney-General was asked—

[Jack Lopresti (Filton and Bradley Stoke) (Con)]

1. What steps the Crown Prosecution Service is taking to increase the number of prosecutions for human trafficking.

[Karl MᶜCartney (Lincoln) (Con)]

5. What steps the Crown Prosecution Service is taking to increase the number of prosecutions for human trafficking.

[Rehman Chishti (Gillingham and Rainham) (Con)]

7. What steps the Crown Prosecution Service is taking to increase the number of prosecutions for human trafficking.

[The Solicitor-General (Oliver Heald)]

The Crown Prosecution Service is supporting victims, strengthening investigations, raising awareness among front-line professionals, and improving data collection. The data for 2013-14 show an increase in the number of defendants prosecuted. The CPS is actively involved in the development of provisions in the Government’s draft Modern Slavery Bill.

[Jack Lopresti]

Does my hon. and learned Friend agree that the forthcoming Modern Slavery Bill will play a significant part in moving forward to prosecute those involved in the dreadful offence of human trafficking?

[The Solicitor-General]

Yes, I very much agree. The forthcoming Bill will play a vital role in tackling the abhorrent practices of human trafficking and modern slavery. It will strengthen the law and protect and support victims. I am a member of the inter-ministerial group, and my officials and the CPS have been closely involved in developing these measures under the leadership of the Home Secretary, who is widely admired for her stance on this issue.

[Karl MᶜCartney]

Does my hon. and learned Friend agree that an important part of the process of increasing the number of prosecutions for human trafficking is to ensure that there is sufficient support for victims of this terrible crime? What further support is the CPS providing to victims in this regard?

[The Solicitor-General]

Yes, I entirely agree. A focus on supporting victims, stronger prosecutions and better data collection is key. In December, the Director of Public Prosecutions held a meeting with voluntary bodies and others, and he has produced an action plan that is very much focused on supporting victims.

[Rehman Chishti]

What steps are being taken to improve international co-operation to increase prosecutions for human trafficking?

[The Solicitor-General]

My hon. Friend has raised this issue before, and it is very important. The new National Crime Agency has a focus on organised crime gangs at a regional, national and international level. The Crown Prosecution Service has officials in other countries working to strengthen capacity and ensure that prosecutions are properly evidenced. Joint investigation teams are an important feature. On 9 April at the Vatican, the Home Secretary set up the Santa Marta group, which is a group of senior enforcement officers from across Europe and the world. This was highly praised by Cardinal Parolin of the Vatican and by the United Nations.

[Alison Seabeck (Plymouth, Moor View) (Lab)]

What use does the CPS make of the National Crime Agency’s database to identify victims of human trafficking in order to ensure that any prosecution that follows takes into account the relevance of the fact that they have been trafficked?

[The Solicitor-General]

The hon. Lady makes an important point. There needs to be a very strong effort to ensure that the victims of trafficking are treated as such in cases where it is possible that they should be prosecuted, if they are victims rather than the main perpetrators. All the resources of the sort she mentions, and others, are to be looked at. I think she will be pleased when she sees the Modern Slavery Bill in its new form.

[Diana Johnson (Kingston upon Hull North) (Lab)]

What does the Solicitor-General think about extending the period of reflection from the 45 days that are currently allocated to a longer period to ensure that there is full support for victims of trafficking who may then be more willing to be witnesses in any prosecutions?

[The Solicitor-General]

The hon. Lady will appreciate that that is not a decision for the Law Officers. It is important, however, that all support for victims should be considered within the inter-ministerial group, and I will certainly ensure that it is fully considered. In other terms, I cannot go much further.

[Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

Nigeria is the largest source country for people trafficked into the UK. Given that there is widespread fear that the girls who were kidnapped a month ago could become victims of trafficking, what special efforts are the Government making to work with and support the Government of Nigeria, and agencies there, to prevent that from happening?

[The Solicitor-General]

As the hon. Lady may know, the Crown Prosecution Service has had staff in Nigeria and has worked hard on capacity building. The response to the Boko Haram outrage is being dealt with by other Departments, but I know that right across the House there will be very great concern for those girls and their families, and that is certainly something I share.

[Fiona Bruce (Congleton) (Con)]

2. What steps he is taking to ensure that cases of non-compliance with the law on abortion by practitioners and providers are prosecuted.

[The Attorney-General (Mr Dominic Grieve)]

The Crown Prosecution Service will review any cases referred to it by the police, in accordance with the two-stage test set out in the code for Crown prosecutors. Following observations by the former Director of Public Prosecutions, the Department of Health is developing further guidance for practitioners on the procedures to be followed when a woman requests an abortion, and that will be taken into account when future decisions are made about prosecutions.

[Fiona Bruce]

My right hon. and learned Friend will have seen reports arising from recent freedom of information releases about 67 doctors who pre-signed abortion certificates effectively authorising abortions without ever having seen or had any knowledge of the women involved. He will also be aware that the General Medical Council failed to report those cases to the police. Will he assure the House that they will now be dealt with by means of a thorough investigation and on a case-by-case basis? No one should be above the law, particularly in such cases.

[The Attorney-General]

I fully understand my hon. Friend’s concerns. She will appreciate that, in the first instance, this is a matter for investigation by the Metropolitan police, not the CPS, which, obviously, has no investigative capacity. Should the matter come to the CPS, it will indeed be considered on a case-by-case basis. She will be aware that when this matter has been before the House in the past, it has been pointed out that the essential ingredient is that a doctor has to act in good faith in the advice and opinion they give. If there is evidence that a doctor has not acted in good faith, that will clearly be one of the important evidential components taken into account when deciding whether any prosecution should be brought.

[Jim Shannon (Strangford) (DUP)]

Accounts of abortion on the grounds of gender are of increasing concern to many in this House. Will the Attorney-General confirm that the strongest sanction possible will be brought against individuals, whoever they may be, who are implementing abortion on the grounds of gender?

[The Attorney-General]

I fully understand the hon. Gentleman’s concerns. I want to make it clear—as, indeed, I have made clear in the past—that, on abortion on the grounds of gender, we have to look at the question of the good faith involved in allowing such a thing to take place. The tests have been well explained by the previous DPP and any case in England and Wales would be viewed according to them. To make the position clear: abortion on demand, as it is sometimes described, is not provided for by the Abortion Act 1967.

[Mr Philip Hollobone (Kettering) (Con)]

What is the penalty for such an offence?

[The Attorney-General]

My hon. Friend takes me gently by surprise. I think it depends on the nature of the offence under the Abortion Act, but my recollection is that the procurement of an abortion illegally is a very serious offence. I will write to him as to the exact penalty.

[Mr Speaker]

I think the House would benefit from having a copy of the letter in the Library. We are grateful to the Attorney-General.

[Mark Durkan (Foyle) (SDLP)]

The Department of Health seems to advise that it would be okay if neither of the two signing doctors had actually seen the woman referred for an abortion. Does the Attorney-General believe that that is some distance from a strict reading of the 1967 Act?

[The Attorney-General]

As I understand the matter, the form exists so that two doctors may make an independent evaluation of whether the abortion is necessary for the health and well-being of the woman concerned. It seems to me, as a matter of logic, that that requires a conscious act of assessment. I leave it to the hon. Gentleman to work out whether a conscious act of assessment is going to take place on the pre-signed form.

[Jeremy Lefroy (Stafford) (Con)]

3. What steps the Crown Prosecution Service is taking to assist development of justice systems in developing countries.

[The Attorney-General (Mr Dominic Grieve)]

The Crown Prosecution Service works closely with the United Kingdom and international partners to deliver targeted justice assistance in developing countries of priority to UK national security. It does this on a range of important threats and topics, such as counter-narcotics, counter-terrorism, asset recovery and cyber-crime.

[Jeremy Lefroy]

I welcome that answer. What specifically is the CPS doing in countries that are experiencing high levels of conflict, particularly Afghanistan?

[The Attorney-General]

The CPS has until reasonably recently had an important programme in Afghanistan, although it is currently at an end. The programme enabled prosecutors to work with local counterparts to deal with narcotics and corruption investigations and prosecutions, one of which was the massive Kabul bank fraud, which saw two former bank chiefs convicted and jailed in March 2013. I visited that project when I was in Kabul.

In addition, there are projects in Nigeria, to which my hon. and learned Friend the Solicitor-General has referred and which have been complimented by the Chief Justice of Nigeria for speeding up the criminal process. There has also been a major project in the Indian ocean area that has led to 110 pirate cases being prosecuted by CPS prosecutors.

[Hugh Bayley (York Central) (Lab)]

Some crimes committed by British companies or British citizens can be tried in this country or in a foreign country if they are transnational financial crimes committed in a foreign country. What is the Crown Prosecution Service doing to equip developing countries with investigative mechanisms to ensure that more of those cases are tried in the countries in which the offences are committed?

[The Attorney-General]

It is important to understand that the Crown Prosecution Service has limited capacity, but it has prioritised for co-operation a series of overseas aid projects in a number of countries, including the United Arab Emirates, the ones I have just given, and St Vincent and the Grenadines. In addition, it is worth bearing in mind that the United Kingdom Government use the assistance of non-governmental organisations, such as the Slynn Foundation and the Bingham Centre for the Rule of Law, to provide capacity building as well. Simply to give an example, I have seen projects in the west bank being brought forward with the help of those organisations, so not just the Crown Prosecution Service can help in this area.

[Graeme Morrice (Livingston) (Lab)]

Corruption and bribery are major factors undermining the rule of law in many developing countries. However, the serious fraud squad has yet to land a secure conviction under the Bribery Act 2010. What steps has the Attorney-General taken to ensure that the agency has the resources it needs to investigate these important cases?

[The Attorney-General]

The director of the Serious Fraud Office is quite clear that, for him, bribery is a priority area. I am fairly confident, from the cases currently being investigated and looked at, that we will see such prosecutions brought successfully. In so far as resources are concerned, if there was any case in which he had difficulty in respect of resources and felt that he was not able to take it forward, he would certainly come to speak to me about it.

[Mr William Bain (Glasgow North East) (Lab)]

4. What recent assessment he has made of the effectiveness of the Serious Fraud Office.

[The Attorney-General (Mr Dominic Grieve)]

I meet the director of the Serious Fraud Office regularly to discuss the continuing progress that it is making under his leadership. The Serious Fraud Office underwent an inspection by Her Majesty’s Crown Prosecution Service inspectorate in 2012, at my request, and a follow-up inspection of the SFO is currently taking place. I will discuss the outcome of that inspection with the director following publication of the report.

[Mr Bain]

The year 2010 was the last in which a criminal sanction was imposed on a corporate defendant by the Serious Fraud Office. Does the Attorney-General agree with the Opposition and the director of the Serious Fraud Office, David Green QC, that there should be a review of our highly restrictive laws on corporate liability, with a view to securing more prosecutions?

[The Attorney-General]

I have great sympathy with the points raised by the hon. Gentleman. In my judgment, this is an area that ought to be looked at and on which there may, indeed, be a degree of consensus across the House. Of course, if we were to do that, we would also have to make sure that such a process operates in a fair and reasonable way, but I have to say that I have listened very carefully to what the director of the Serious Fraud Office has said, and it seems to me that his remarks have considerable force.

[Ian Lucas (Wrexham) (Lab)]

Last week, the work of the Serious Fraud Office was severely undermined when a case it was prosecuting was stayed. What discussions has the Attorney-General had with the Lord Chancellor to address that issue?

[The Attorney-General]

The case did not involve the Serious Fraud Office, but the Financial Conduct Authority. In the circumstances, that case is not a matter that I have had to discuss with the director of the Serious Fraud Office.

[Emily Thornberry (Islington South and Finsbury) (Lab)]

Yes, but the Attorney-General will agree that the rule of law means that no one is above the law. It is, of course, very important that those who commit complex fraud should be prosecuted as the common criminals they are. Will he not therefore take this opportunity to express his dismay at the fact that meticulous cases taken to court by the prosecuting authorities may be stopped because such people cannot be tried, because in turn they cannot be represented, because in turn there is insufficient legal aid? If the Attorney-General wished to have my support in his meeting with the Lord Chancellor to explain the rule of law, I would be very happy to help him.

[The Attorney-General]

As the specific case to which the hon. Lady refers is before the Court of Appeal and, therefore, sub judice, I will not comment on it. On the general point that she makes, I certainly agree that it is clearly in the public interest that alleged serious crime should be prosecuted. We will have to await the outcome of the case to see whether the resources that are made available in this instance are satisfactory.

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

6. What steps he is taking to raise awareness of the law relating to contempt of court.

[Henry Smith (Crawley) (Con)]

8. What steps he is taking to raise awareness of the law relating to contempt of court.

[The Attorney-General (Mr Dominic Grieve)]

Since taking office, I have been active in ensuring that the public are better informed of the law of contempt and, in particular, the dangers of online commentary. I have done that in a variety of ways including education, delivering speeches, attending symposia on contempt, and review by asking the Law Commission to look at the law of contempt and legislation. New criminal offences of juror misconduct and amendments to the law of contempt are being introduced in the Criminal Justice and Courts Bill. Finally, where necessary, I institute contempt proceedings against contemnors.

[Mr Buckland]

I thank my right hon. and learned Friend for that answer. I welcome the new offences in the Criminal Justice and Courts Bill. How does he see the interrelation between those new offences and the existing law of contempt working? In other words, how will judges be expected to deal with the often knotty problems that come before them when jurors misbehave?

[The Attorney-General]

I hope that the benefit of this change to the law will be to emphasise the criminal nature of the conduct of a juror who fails to follow the judge’s directions and acts in a way that undermines the fairness of a trial process. At the same time, by providing that it is an indictable offence that is triable by jury, there will be better safeguards for jurors in terms of fairness if they are prosecuted as a result. I trust that the combination of those two things will enable judges to be more robust in their directions to the jury at the outset when explaining that it has an important function to perform, and that that must be performed within the framework that the judge lays down in his directions. In my experience, jurors are, for the most part, animated entirely by good will towards the public interest, so I feel that if we do that, some of the regrettable problems that we have had may be further reduced.

[Mr Speaker]

I am sure that the House will agree unanimously that we are all now considerably better informed.

[Henry Smith]

In recent years, the use of social media such as Twitter and Facebook to express opinion has increased significantly. What advice can my right hon. and learned Friend give those who are taking part in court proceedings to ensure that, in using those methods of communication, they are not in contempt?

[The Attorney-General]

The change that we have introduced is that we tweet and post online the advisories that we issue. Whereas in the past those were sent confidentially to the media, they are now accessible in a similar, if not identical, form to individuals who may take an interest in the trial process. We hope that individuals will thereby be warned about the dangers of inappropriate comment and that, as a result, fewer proceedings against those who abuse the system will be necessary.

[Guy Opperman (Hexham) (Con)]

rose—

[Mr Speaker]

The hon. Member for Hexham can scarcely contain his excitement. I call Mr Guy Opperman.

[Guy Opperman (Hexham) (Con)]

9. What steps the Crown Prosecution Service is taking to prosecute cases involving female genital mutilation.

[The Solicitor-General (Oliver Heald)]

The first prosecution is under way. Lead prosecutors have been appointed for each CPS area. The Director of Public Prosecutions and I have written to Ministers in the Home Office, the Ministry of Justice and the Department of Health to suggest ways in which the criminal law could be strengthened.

[Guy Opperman]

I urge the Solicitor-General to take note of the Home Affairs Committee report on this issue and to target the local communities in this country and abroad where this abhorrent crime is increasingly taking effect.

[The Solicitor-General]

My hon. Friend is right that a prosecution is, in a sense, a failure because we want to diverge from this activity, stop it happening and change minds in communities. That is the essence of what the Government are trying to achieve, although we have to have prosecutions where necessary and we have a strong action plan to achieve them.

[Several hon. Members]

rose—

[Mr Speaker]

Order. I am sorry to disappoint colleagues, but we must move on.

Ukraine

Tuesday 13th May 2014 Commons Chamber

12:34

[The Secretary of State for Foreign and Commonwealth Affairs (Mr William Hague)]

With permission, Mr Speaker, I would like to make a statement on recent events in Ukraine. I will update the House on the situation on the ground, the diplomatic work going on to reduce tensions, the decisions we made at the Foreign Affairs Council in Brussels yesterday, and the approach that we will continue to pursue over the coming weeks.

Presidential elections will be held in Ukraine on 25 May. In the vast majority of the country, preparations are proceeding well under the observation of the Organisation for Security and Co-operation in Europe. The UK is contributing 100 observers to the OSCE Office for Democratic Institutions and Human Rights election observation mission, which is 10% of the total number; £429,000 for the first round of elections. We have also given £1 million in funding so far to the special monitoring mission. I met the heads of both those vital missions in Ukraine last week, and I thanked them for the hard work of their teams in difficult and sometimes dangerous circumstances.

However, in two of Ukraine’s 25 regions—Donetsk and Luhansk, in the south and east of the country—the situation has deteriorated markedly over the past two weeks. A constant barrage of propaganda by the Russian media, and a steadily mounting death toll, are contributing to an atmosphere of fear, uncertainty and division. So-called pro-Russian separatists, led by people who by their training, equipment and behaviour give every appearance of sometimes being Russian special forces, have continued to seize and occupy Government buildings in the south and east of Ukraine, using many of the same tactics that were deployed in Crimea. We have seen intimidation of journalists, abductions and murders. Missiles have been used to destroy at least four Ukrainian military helicopters, giving the lie to Russia’s claim that these are the actions of spontaneously organised local protestors, rather than well-trained, well-equipped professionals.

On 2 May more than 40 people died in Odessa, including many pro-Russian protesters trapped in a building that was set on fire—an act we condemn unreservedly. This weekend, separatist groups staged sham “referendums” on self-rule in parts of Donetsk and Luhansk. Those polls were marked by blatant fraud, including multiple voting, no proper voting lists, and threats and intimidation against Ukrainians standing up for the unity of their country. The referendums met no basic standards of objectivity, transparency and fairness, and they have no credibility whatsoever. We will not recognise those or any other attempts to undermine the territorial integrity of Ukraine, including Russia’s illegal annexation of Crimea.

The Government believe that our national interest lies in a democratic Ukraine able to determine its own future, and in protecting a rules-based international system. Therefore, our objectives remain to avoid any further escalation of the crisis, to support the independence and sovereignty of Ukraine, and to uphold international law.

I visited Ukraine, Moldova and Georgia last week, to show our support at a time when all three countries are feeling acute pressure. We look forward to the signing next month of Georgia and Moldova’s association agreements with the EU, which will also establish deep and comprehensive free trade areas, and are currently under parliamentary scrutiny. I gave our strong support to the Moldovan Government’s plans to sign and implement the agreement, and encouraged them to make more progress on reform and in the fight against corruption. In Georgia I discussed, and thanked the Government for their contribution to, their partnership with NATO.

In Ukraine I met the Prime Minister, Foreign Minister and the Head of the National Security and Defence Council, as well as the Governor of Donetsk and two presidential candidates. I encouraged all Ukraine’s leaders to communicate with people in the south and east of the country, and to counter Russian disinformation. I welcomed the steps the Government have taken to launch an inclusive dialogue on constitutional reform and decentralisation, and to offer an amnesty for those who peacefully leave occupied buildings in eastern Ukraine. I assured Ukrainians of our support for the presidential elections, which must be allowed to take place free from violence and intimidation.

On top of our strong support for the work of the OSCE, the UK is providing technical assistance to support public financial management and other reform efforts in Ukraine. We have led the call for the urgent imposition of EU sanctions targeting individuals suspected of misappropriating funds from the Ukrainian state, and we hosted the Ukraine Asset Recovery Forum two weeks ago in London, with the United States and Ukraine, in order to co-ordinate this work.

As I have always stressed, the doors of diplomacy remain open. We continue to discuss the situation with Russia, and the Prime Minister had a long conversation with President Putin on 1 May. We strongly supported the Geneva agreement of 17 April and deplore the failure of Russia to join in implementing it. It is right to try now to revive the diplomatic process, and I support and welcome the efforts being made by OSCE Chair-in-Office and President of Switzerland, Didier Burkhalter. Last week I met him in Vienna, and I held further discussions with him over the weekend and yesterday in Brussels. Last Wednesday, he met President Putin and put forward a four-point plan, including the immediate launch of a national dialogue by the Ukrainian authorities with OSCE support. We have encouraged Ukraine to respond positively to this, and it is doing so. The Government have announced they will hold the first meeting tomorrow, and agreed that there will be both Ukrainian and international mediation in this process.

I strongly believe it is in the interests of all concerned to seize these opportunities to reduce tensions. It is manifestly in the interests of the people of Ukraine, including in Donetsk and Luhansk, where there is a danger of the violence growing even worse and many more lives being lost. It is in the interests of Russia, because some events have already moved beyond its control, and because the long-term economic and political costs to Russia of an escalating crisis will be very serious. It is also urgent, because the situation is deteriorating, and the elections are only 12 days away. We look to Russia to exercise its influence and to take every opportunity to restrain those responsible for violence and disorder, consistent with President Putin’s remarks last week that the elections are a step forward.

Yesterday I attended the EU Foreign Affairs Council, at which we made it clear that attitudes and behaviour towards the holding of the elections will have particular importance in deciding whether or not wider economic and trade sanctions will be applied. Preparations for these sanctions are at an advanced stage.

There is no doubt that the Ukrainian authorities are making thorough preparations for the elections to be held, and therefore Russia’s willingness to exercise its influence over illegal armed groups in parts of eastern Ukraine will be the decisive factor in whether everyone in the eastern provinces will be able to exercise their right to vote. Since Russia has taken no practical steps to de-escalate the crisis so far, we agreed yesterday to add a new group of 13 individuals and two companies to the list of persons sanctioned by the EU. This is the first time that entities—companies—have been sanctioned by the EU in relation to the crisis.

We agreed to expand the criteria for sanctions. These will now cover not just individuals directly responsible for undermining the security, territorial integrity, sovereignty and independence of Ukraine, but also a broader range of individuals and entities linked to separatist and illegal activities. For the first time, the sanctions will also be applicable to entities in Crimea or Sevastopol whose ownership has been transferred contrary to Ukrainian law, and to those who obstruct the work of international organisations in Ukraine.

At the Foreign Affairs Council, we also called on Russia to take effective steps to fulfil its Geneva commitments: to refrain from provocative acts and intimidation, to use its influence with separatist groups to compel them to disarm and to vacate illegally occupied buildings, and to cease its destabilising campaign. We demanded that Russia move its troops away from the Ukrainian border. President Putin said last week that troops were returning to their regular training grounds. However we have seen no evidence that Russia has reduced the huge number of its troops stationed just miles from Ukraine, and in fact Moscow continues to encourage the actions of separatists, including through the state-controlled media.

In addition to these steps, we agreed as Foreign Ministers that the EU will prepare a possible civilian mission in Ukraine, to support capacity building in the fields of rule of law, and judicial and police reform. We maintained our firm commitment to sign the remaining provisions of the association agreement with Ukraine, including the deep and comprehensive free trade area, as soon as possible after the presidential elections.

It is clear that if Russia does not take the path of de-escalation, the long-term cost to it will grow, in an economy already shrinking and suffering massive capital flight. G7 Energy Ministers met in Rome last week and committed themselves to reduce market power and political influence through energy supply. EU leaders will discuss further detailed measures when they meet in June.

The people of Ukraine deserve the right to choose their own Government in a free and fair election, just as we do. They also deserve to be free from external interference and duress and to have the chance to chart an independent future without the debilitating corruption and mismanagement of recent years. They should have every opportunity to be a bridge between east and west, and not to have their country pulled apart by the fanning of hatreds, the wilful sowing of violent disorder, and the insertion of provocateurs and separatists from over their borders.

There is now a fresh opening for Russia, and anyone else fostering violence and tension, to turn back from the brink. The coming days will demonstrate whether they are going to take it. The UK will do everything it can to encourage that and to support the holding of open and fair democratic elections. The international community must continue to be prepared to act with resolve and determination, to persuade the Russian Government to change their approach, to defend a rules- based international system, and to prevent a deterioration of the situation in the wider region.

12:45

[Mr John Spellar (Warley) (Lab)]

Mr Speaker, you and the Foreign Secretary will, I hope, be aware of the reasons why the shadow Foreign Secretary is regrettably not able to be here to respond to the statement. I thank the Foreign Secretary for it, and for advance sight of it.

Before turning to the Foreign Secretary’s remarks on Ukraine, may I first briefly address the recent horrific events in Nigeria? We welcome yesterday’s written statement and the steps taken by this Government, alongside allies, in support of the Nigerian-led efforts to rescue the captured girls. We note that the EU Foreign Affairs Council’s conclusions make reference to the situation in Nigeria. The Foreign Secretary will be aware that in recent days, Members on both sides of the House have been urging that the opportunity be given to debate the matter in Parliament. I expect that those requests have been noted and that the Government will respond accordingly.

Turning to Ukraine, as the Foreign Secretary stressed, the situation in eastern Ukraine is deeply troubling. The violence continues, the death toll is rising and the situation is increasingly volatile. He is right to condemn unreservedly the offence on 2 May in Odessa, where more than 40 people died. He is also right to condemn the referendums in Donetsk and Luhansk on Sunday, which were both illegal and illegitimate. The priority must now be for calm to be restored and further violence to be prevented.

The events over the weekend have created a key moment when the real resolve and intentions of Russia must now be tested. In recent days, President Putin has publicly issued words that some have seen as a sign of possible progress. The international community, however, must judge President Putin not by his words alone but by his actions. He said that the referendum should be postponed. Now, he must condemn the fact that it has taken place. He said that presidential elections might be a step forward. Now, he must help to create the conditions for them to take place peacefully. He said that he has withdrawn troops from the border. He must allow NATO to verify that. He has signed up to the Geneva accord of 17 April. Now, he must help to implement it. If President Putin fails to take the minimum steps required to demonstrate that he is willing to change course, the west must be prepared to increase pressure in the days and weeks ahead.

We welcome the steps agreed at yesterday’s EU Foreign Affairs Council to extend existing targeted measures, including against two Ukrainian companies. On the measures agreed, will the Foreign Secretary confirm whether he expects the expanded criteria to result in the addition of further Russian entities to the list of companies targeted by such actions? Will he confirm whether we are taking steps to secure a further meeting between the signatories as a way of trying to make further progress on implementation? We note the Council’s conclusions in support of a further meeting, but in the light of Russian statements that no such meeting is planned, could he set out the likelihood of it taking place?

I welcome the Foreign Secretary’s remarks on the EU’s preparatory work on possible wider trade and economic sanctions against Russia. Can he provide any further detail on the measures under consideration? Will he confirm that any steps taken by Russia to seek to prevent the peaceful process of presidential elections this month would be deemed a serious escalation, and further evidence of their wilful intention to destabilise the situation in Ukraine further? We welcome the Foreign Secretary’s confirmation that an association agreement is due to be signed with Georgia and Moldova next month, alongside a free trade area.

The Foreign Secretary will be aware that many countries in the region, especially those from the former Warsaw pact and former Soviet Union, but also including our Nordic allies, have a deeper concern that Russia’s actions in Ukraine are not an isolated incident but part of a developing and worrying trend—particularly in the light of claims by the Russian Government about their need to protect Russian speakers or ethnic Russians, irrespective of their nationality or the credibility of any real threat against them. It is little wonder that this has caused apprehension and even alarm. Will the Foreign Secretary confirm what discussions he has had with our EU and NATO allies on our response to these developments?

[Mr Hague]

I am grateful to the right hon. Gentleman. Given that he asked about Nigeria, it may be in order to say one sentence about Nigeria. I issued a written statement yesterday, the matter was discussed at the Foreign Affairs Council yesterday and I briefed the Cabinet on the situation this morning. Our team was deployed to Nigeria last Friday and has had meetings over the last few days with the Nigerian security authorities, with the President and with representatives of the families of the girls who have been abducted. They are working closely with the US team and we are in close touch with the Nigerians about what more we can provide as additional assistance. That was a long sentence! I hope it briefly keeps the House up to date on how we are responding to this appalling crime.

The right hon. Gentleman expressed through his statement and questions the bipartisan approach we have to the crisis in Ukraine. He was quite right to say that President Putin and Russia should be judged on their actions, not just on words at press conferences, and that we should be prepared to increase the pressure. The decisions we took yesterday in Brussels are clear evidence of our willingness to increase the pressure. Not everybody expected us to agree further sanctions yesterday, but we felt that in the absence of concrete steps from Russia to de-escalate, it was right to add to the sanctions. To answer the right hon. Gentleman’s question about whether there could be further extensions to the list of individuals and entities subject to asset freezes and travel bans, yes, absolutely there could be. Because we have substantially widened the criteria, many more individuals and entities can now be added if the circumstances warrant it. There is a real readiness across the whole European Union to do so.

I said in my statement that the wider sanctions—wider economic, trade and financial measures—which we have not yet imposed, are at an advanced stage. I am not able to announce any details, because they would of course have to be agreed in detail at the time. The detailed work has been done by the European Commission in consultation with EU members. It would be desirable to have a further meeting of the parties that took part in the Geneva talks of 17 April. However, it is possible to make progress even without such a meeting, as the work over the last week by the chair of the Organisation for Security and Co-operation in Europe, President Burkhalter of Switzerland, has demonstrated. We are in close touch with him, and he is working closely with the Ukrainian authorities and is, of course, in regular touch with Moscow to try to make his four-point plan work. I very much welcome his dedication to that task, and I will remain in close touch with him.

On the question of whether the further steps to destabilise the elections represent a serious escalation, yes, that is absolutely right, as was made clear at the Foreign Affairs Council yesterday and by Chancellor Merkel and President Hollande in their press conference on Saturday. The right hon. Gentleman is quite right to refer to the concerns created, particularly in countries with Russian-speaking minorities, about how Russia has defined its interests and its right, as it sees it, to intervene in other nations in defiance of the UN charter and international law. That is why NATO has made decisions to give greater assurance to our colleagues, particularly in the Baltic states. As he knows, we have reinforced the air policing of the Baltic, including by sending Royal Air Force Typhoon jets, and we will take other steps as necessary.

One of the results of what Russia has done is that at the NATO summit, which we are proud to host in Wales in September, NATO’s responsibilities to ensure the collective and guaranteed defence of its European members, and our readiness to revitalise that and ensure that it remains there in the coming years, will be a topic of great discussion—greater than it would have been without this crisis.

[Dr Liam Fox (North Somerset) (Con)]

The implications for this crisis go well beyond Ukraine. Putin has effectively said that the protection of ethnic Russians in another country is not a matter for the laws of that country or the constitution or the Government, but for an external power—namely Russia. This is a fundamental challenge to international law. Does my right hon. Friend agree that it is not enough just to de-escalate on Ukraine; we need assurances from the Kremlin that Russia will not interfere in any other sovereign state simply on the basis that ethnic Russians live there? Otherwise, sanctions must continue on that very basis.

[Mr Hague]

My right hon. Friend is quite right that huge principles are at stake here. That is why the reaction in the United Nations has been so clear and overwhelming: in the votes held in New York, Russia was entirely on its own in the Security Council, with China abstaining. Russia was outvoted in the General Assembly by 100 votes to 11 precisely because the issues at stake are exactly as great as my right hon. Friend describes them. That is why I underline the long-term cost to Russia—in the reduction of energy market power, the reduction of influence in eastern Europe because of populations turning against it and NATO reinforcing its responsibilities for the defence of its eastern members. All of that flows from what Russia has done in recent weeks.

[Mr Jack Straw (Blackburn) (Lab)]

May I first welcome the Foreign Secretary’s statement and commend the approach he has adopted? May I ask him about the position of the German business lobby, part of which has been arguing, with the assistance of the former German Chancellor, against any kind of wider economic sanctions? The position of Chancellor Merkel and Foreign Minister Steinmeier has been commendable, but what assessment does the right hon. Gentleman make of Germany’s understanding that it is in its interest to ensure that if necessary, sanctions, including business sanctions, are strengthened if there is no other way of securing some observation by Russia?

[Mr Hague]

I think that is understood in Germany—certainly by their ministerial and political leaders. I had a long discussion with Mr Steinmeier before yesterday’s Foreign Affairs Council, and he fully joined in bringing about the decisions we made at that Council, while Chancellor Merkel expressed Germany’s strong view at her press conference on Saturday. Of course it is understood across Europe that wider sanctions against Russia will have some damaging consequences in Europe. I have said before that if we come to that point, those sanctions will be designed to have the maximum effect on Russia and the minimum effect on European economies—but they would have an effect on Britain, France and Germany. The plans developed for such sanctions include measures to be taken by Germany, and the triggers for them are the ones that I described earlier. We regard Germany as working closely with us on this issue.

[Sir Gerald Howarth (Aldershot) (Con)]

Is it not clear that, far from being deterred by the range of sanctions measures taken by the west, the Russians continue to escalate the crisis with impunity—not least by the deployment to Crimea of some of the most sophisticated weaponry, including, I understand, the latest K-300P Bastion-P mobile anti-ship missile systems? In those circumstances, how on earth can we expect Russia to honour and respect the outcome of the forthcoming presidential elections in Ukraine?

[Mr Hague]

Russia certainly has the involvement I pointed out in my statement, but I also argued that, given the longer-term consequences for Russia, the escalating sanctions, and some of the tragedies that have happened, such as in Odessa, it is in Russia’s interests to co-operate with the initiative that the OSCE chair has launched, which we support.

Russia is capable of adjusting its approach. As others have said, President Putin’s actions will be much more important than his words, but his words last week, when he described the elections as a step forward in Ukraine, represent a substantive change in the Russians’ position. Their previous position was that Yanukovych was still the legitimate President of Ukraine. Clearly, if the elections are a step forward, the Russians have changed their position in accepting a new president rather than the old one. The Russian position has very much created this crisis, but it is not an immutable position.

[Mr Bob Ainsworth (Coventry North East) (Lab)]

The apparent contrast between what President Putin has been saying and what Sergei Lavrov appears to be saying—that the referendums must be accepted as an expression of opinion and taken seriously—is leading many people to believe that this is just a cynical tactic on the part of the Russian Administration. Does the Foreign Secretary share their fear, and, if so, does he believe that their analysis is recognised by our European partners?

[Mr Hague]

Yes, I think so. Again, the test is what actually happens. There is a strong school of thought which holds that Russia’s call for the sham referendums not to go ahead, although they went ahead, was intended more to disclaim responsibility for them than actually to discourage them. The Russians have reacted by saying that they respect what they see as the will of the people, which was expressed in such a massively anti-democratic fashion as the referendums, but they have not reacted in the same way as they did after the sham referendum in Crimea, by annexing the territory concerned. They clearly see Donetsk and Lugansk in a different light from Crimea, and what they want to do is different. It is terrible, but it is different, and we will continue to judge them by the differences in their actions.

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

My right hon. Friend paints an understandably grim picture. At the risk of over-dramatisation, I would say that this has all the characteristics of a powder keg. President Putin will not adopt diplomacy until he is satisfied by what he has achieved or is forced to come to the table, which renders the point made by the right hon. Member for Blackburn (Mr Straw) all the more significant. Is my right hon. Friend entirely confident that the countries of the European Union will be unanimous in any further extension, and, in particular, that the United States will form part of any such extension, given that this is a matter for the Atlantic alliance as a whole?

[Mr Hague]

So far, the co-ordination between the United States and the EU and between EU nations has been very strong, and we in the UK play an important role in ensuring that there is that co-ordination. Any discussion behind closed doors often features a variety of views—as one would expect, when 28 EU nations are involved—but so far we have had no difficulty in reaching unanimous agreement on the sanctions that I have described, and that includes the decisions we made yesterday. Russia should not underestimate the willingness of the European Union to add further measures, including more far-reaching measures if necessary, and to engage in close co-ordination with the United States of America in that regard.

[Ms Gisela Stuart (Birmingham, Edgbaston) (Lab)]

The first broadcast in Ukrainian by the BBC World Service was in June 1992, and the last was in April 2011. Given that the Foreign Secretary himself has referred to the constant propaganda from Russia, will he discuss with the BBC whether it is time to reinstate that service?

[Mr Hague]

I think that point is worth considering. As I discovered in Ukraine last week, there is a constant demand for other media and for impartial media, given the behaviour of Russian-controlled or Russian-sponsored media, and we are considering ways in which that can be encouraged without controlling it ourselves. Of course, there is now a greater proliferation of television channels and forms of communication of every kind, so the answer is not necessarily to replicate exactly what we had before, but in many parts of eastern Europe there is a need for impartial information and news, and that is something that we must not neglect.

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

Can the Foreign Secretary confirm that if the situation in Ukraine deteriorates or another emergency occurs elsewhere which requires the House to sit during prorogation, the issue of a royal warrant will be required? Will he explain how that procedure would work in practice?

[Mr Hague]

It is no simple matter for the House to sit during prorogation, which is one of the reasons for making my statement today. Indeed, it would be unprecedented. Nevertheless, the Civil Contingencies Act 2004 provides a means for the House to sit in extreme circumstances, if there is a threat to the United Kingdom. The Leader of the House will be much more familiar with the details than I am, but I think that my hon. Friend should bear in mind that the threshold for the assembly of Parliament during prorogation is very, very high.

[Mr David Winnick (Walsall North) (Lab)]

While Russia undoubtedly has responsibility for the crisis that has occurred, is it not a fact that many people feel an attachment to Russia, particularly in eastern Ukraine? Whoever wins the presidential elections on the 25th of this month, will there not be a responsibility—a very important responsibility—to reach out to the large number of people who, rightly or wrongly, feel a greater attachment to Russia than to Ukraine?

[Mr Hague]

According to reputable surveys, even in the eastern parts of Ukraine there is little evidence that people want to be part of Russia, although of course there is much evidence of disaffection in regard to politics, their own former leaders in Kiev, and so on. However, the hon. Gentleman is right to say that reaching out and inclusivity within the whole of Ukraine are vital, and that will be a very important task for whoever wins the presidential election. I have now met five of the presidential candidates—including all the leading ones in Ukraine—and have given them that advice, as well as the advice that they must secure an end to the whole culture of corruption and cronyism that has prevailed in Ukraine in the past.

[Sir Richard Ottaway (Croydon South) (Con)]

Whatever we may think about Russia—and I for one am distinctly unimpressed—the Russians are people with whom we must do business. I have in mind the negotiations over Iran. Does my right hon. Friend agree that we need to avoid institutional hostility and keep the lines of communication open, although the Russians do not make it easy for us?

[Mr Hague]

“Unimpressed” is a good bit of British understatement from the Chair of the Foreign Affairs Committee. My right hon. Friend is right: it is important to keep channels of communication open. That is what I do with Foreign Minister Lavrov, and that is why the Prime Minister has spoken to President Putin several times during this crisis. Even as we speak, our representatives are sitting with Russia in the E3 plus 3 negotiations with Iran, and working constructively together on one of the world’s other great issues. We will make every effort to continue to do that, because it is in the global interest and in our national interest.

[John Woodcock (Barrow and Furness) (Lab/Co-op)]

Will the Foreign Secretary make it clear that we do not simply suspect that Russia is behind much of the armed insurrection in the east of Ukraine, but hold the country squarely responsible? If such tactics were attempted in a NATO member country, they would trigger a full article 5 response.

[Mr Hague]

There is no doubt about that. I hope that I made it clear in my statement, but I am happy to restate our certainty about Russian involvement in the violence and disorder that have taken place in eastern Ukraine. What has happened does not have the characteristics of spontaneous protest. The level of equipment, training and co-ordination involved demonstrates that there is outside intervention. Ukraine is not, of course, a member of NATO, but I am sure that were such things to happen in a NATO member country, it would be able to invoke article 5 of the NATO treaty.

[Mr Julian Brazier (Canterbury) (Con)]

Following on from the question of the hon. Member for Barrow and Furness (John Woodcock), in affirming our support for NATO and article 5, what other countries apart from ourselves and the United States have sent troops or planes to exercise in the Baltic states and Russia?

[Mr Hague]

The United States did the last rotation of Baltic air policing and we are contributing to it now, as my hon. Friend knows. The French have deployed four Rafale aircraft which are based in Poland. Denmark has deployed four F-16 aircraft to Estonia and there is work on further maritime deployments as well. So a variety of countries are involved in these exercises and policing.

[Mike Gapes (Ilford South) (Lab/Co-op)]

I welcome the deployment of UK forces to front-line NATO states, and I also welcome the Foreign Secretary’s visits to Georgia and Moldova as well as Ukraine, but what assistance and help can we give, particularly to Moldova, because what might happen in Transnistria at some point could be a repetition of what has happened already in Crimea?

[Mr Hague]

This is a very important point and it is one of the things I went to Moldova to discuss with its Government. Of course, the opening up of a closer economic relationship with EU countries is a major opportunity for them. Already, when Russia stopped buying Moldovan wine, which is one of its principal exports, the EU opened up to Moldovan wine. We may have to be ready to do that in other areas of the economy as well. The Moldovan Government made a number of requests to me on my visit, and I am thinking positively about all of them and discussing them with my EU colleagues.

[Sir Edward Leigh (Gainsborough) (Con)]

While in no way condoning Mr Putin’s actions, I just wonder if the EU has played into his hands. Should not peace and reconciliation be our objective now? Should we not in this context reassure Russia that we have no intention of dragging Ukraine into our orbit by Ukraine joining NATO, that any free trade associations with the EU will be balanced with free trade associations with Russia, as Mr Putin proposed, and that there should be full devolution for east and west Ukraine?

[Mr Hague]

We have always made it clear—and I make it clear again now, as I did in my statement—that we have always seen Ukraine as having strong relations with east and west and that it has never been our objective to pull Ukraine in a direction that means it loses its important economic and political relations with Russia. I think that that message is very clear and we are clearly supporting, in the work of the OSCE, decentralisation in Ukraine in a way that is acceptable to the whole of its population, including its regions. I therefore think the problem has lain in the perception of Russia—an inaccurate perception—rather than in the actions of western countries.

[Jeremy Corbyn (Islington North) (Lab)]

Will the Foreign Secretary say something about NATO’s longer term intentions? Since 1990 we have had constant expansion of NATO and that in turn has encouraged an equal and opposite reaction within Russia. Does he not think it is time to stop the expansion of NATO and to try to bring about a peaceful central European region?

[Mr Hague]

NATO is not an alliance designed for offensive purposes. NATO is designed for the defence of the countries concerned and there are free sovereign nations who aspire to join NATO. What is more, their aspiration to join NATO is one of the positive influences on them to adopt strong democratic systems and free and open societies. So the expansion of NATO has been a very healthy development for many countries in the world. I think it would be wrong to bring down the shutters and say, “This is not available to any more countries at any stage.” Becoming a member of NATO is a demanding process, but I think it would be wrong to confine NATO to those countries that are already a member of it.

[Bob Stewart (Beckenham) (Con)]

The NATO summit is four months away. Various NATO members have reaffirmed article 5 already. Would it not make sense for all NATO members to reaffirm article 5—that an attack on one nation is an attack on all—at this time, as the NATO summit is four months away?

[Mr Hague]

I can assure my hon. Friend that there is no doubt about that: the commitment of all the 28 members of NATO to article 5 is absolute. This is a treaty obligation, and this is something they all take very seriously, but to show, through our exercises, our deployments and our planning for the future, just how seriously we take it could very much be something to which the NATO summit turns its attention. That is not just up to us; it is up to all our colleagues in NATO, but I think that, in that sense, my hon. Friend makes a very good point.

[Hugh Bayley (York Central) (Lab)]

I support the UK deployments to the Baltic states and those of other NATO countries. Without wanting to provoke Russia, do the Foreign Secretary and the North Atlantic Council accept that it may well be necessary, in order to give real substance to the article 5 guarantee, to have longer-term deployments of NATO troops in some of those post-Berlin wall accession countries?

[Mr Hague]

Yes, absolutely it could be, and over the next six weeks there will be further meetings of NATO Defence Ministers and of NATO Foreign Ministers, which I will attend in the run-up to the summit we will host in Wales. We have not felt it necessary to take decisions yet about such longer-term deployments; that will depend on how this crisis develops, but we absolutely do not exclude the possibility of doing exactly as the hon. Gentleman mentions.

[Penny Mordaunt (Portsmouth North) (Con)]

What assessment has been made of the impact of Russia’s actions on its own economy, and how much more damaging would the proposed further trade sanctions be over and above these self-inflicted wounds, which presumably Russia thinks are a price worth paying?

[Mr Hague]

Russia’s actions have contributed to its mounting economic problems. One of the main international forecasts for Russia’s economic growth has been downgraded for the coming year from 2.3% to 0.2%. Russia’s Finance Ministry has announced that its economy shrank in the first quarter of this year. The flight of capital from Russia so far this year is now thought to be of the order of $80 billion. Russia’s bonds have been downgraded one level so they are now only one level above junk status. These things have all happened in the last couple of months, and are therefore partly linked to this crisis. This is why I emphasise some of the long-term costs to Russia and repeat that it is in Russia’s interests now to find, with the OSCE and the rest of us, a path of de-escalation.

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op)]

I welcome the statement, and particularly the increase in the sanctions against Russia. The Foreign Secretary will know better than most Members the personality and character of President Putin. Is it not important to make it absolutely clear—he has partially done this—that sanctions will increase in severity week after week, month after month? If we look at the experience of Iran, we see that it is when we get into banking and financial services sanctions that things really start to hurt.

[Mr Hague]

I agree. We have taken this graduated approach but we have never hesitated to add further at each stage, and we demonstrated that again yesterday. I say again that Russia not should underestimate our determination to go further if necessary. The hon. Gentleman is right about the importance of financial measures. Some of the measures taken by the United States have already had some financial effect, but it would be possible to go much further than that, including through what the United Kingdom could do.

[Mr Robert Walter (North Dorset) (Con)]

The Kremlin, the leading members of the Duma and the Russian media have consistently sought to undermine both the authority and the credibility of the interim President of Ukraine and the Government in Kiev. Given that Russia is a member of the Organisation for Security and Co-operation in Europe and the Council of Europe, both of which will be observing the elections next week, what assurances has the Foreign Secretary been given by his Russian counterpart that the Russians will recognise those elections, endorse the result and recognise the authority of the elected President to speak for all the people of Ukraine?

[Mr Hague]

As I am sure my hon. Friend anticipates in his question, we do not have any such assurance from Russia, but of course we do have the one change in Russian policy and attitude to the legitimacy of the elections, which was President Putin’s statement last week that the presidential elections are a step forward in terms of national unity in Ukraine. This demonstrates the importance of the election observation missions, of the elections being demonstrably free and fair, and of the maximum number of people in Ukraine being able to participate in them, because all those things will contribute to the legitimacy of the outcome. I suspect that Russia will be faced with a very legitimate electoral process in Ukraine and will then have to decide its attitude to it.

[Derek Twigg (Halton) (Lab)]

Does the Foreign Secretary believe that Russia did not expect sanctions to be put in place? What is our bottom line for coming to an agreement with Russia? Is it the return of Crimea to how it was? Does he believe that is going to happen?

[Mr Hague]

We have not recognised, and will not recognise, the annexation of Crimea. What we are seeking through OSCE diplomacy now is de-escalation rather than an already prescribed end state. National dialogue in Ukraine in return for Russia acquiescing in elections in Ukraine is really what the OSCE is pursuing. If the hon. Gentleman is asking whether our bottom line is everything going back to normal in the future while Crimea remains annexed by Russia, my answer would be no. There will be permanent consequences from what has happened in Crimea and ever more serious wider consequences—the sorts of consequences I have talked about—if Russia continues on this overall path.

[Mr Tobias Ellwood (Bournemouth East) (Con)]

I visited Odessa recently and came across an EU office which was rightly focusing on reporting on the situation in Moldova, but was not reporting on local developments. Given the disjoint between actual events and how they are sensationally reported in the press, should there not be better independent assessments, possibly used by offices such as those of the EU, to counter the pro-Russian propaganda about which the Secretary of State has spoken?

[Mr Hague]

That is a very important point, and it relates to part of the importance of further expanding the OSCE special monitoring mission. We might also deploy—and we are in favour of deploying—a civilian EU mission to advise on judicial and police reform, but what my hon. Friend is talking about is very much the job of the special monitoring mission. We are supplying further monitors from the UK, with the capability to build up to having 500 monitors in total. Their objective reporting will be very important in the coming weeks to international understanding of the situation.

[Barry Gardiner (Brent North) (Lab)]

Both the current Government in Kiev and the Foreign Secretary in his statement have pointed out that the referendum in Donetsk region was vitiated on the grounds that no valid register of electors is available. That being the case, how do they propose to hold valid presidential elections in the region on 25 May?

[Mr Hague]

Of course the register is available to those authorities holding the legal presidential elections in the vast majority of the country.

[Barry Gardiner]

indicated dissent.

[Mr Hague]

Of course it is true. The election observation mission, which I visited last week, is satisfied with the arrangements so far in 23 of the 25 regions of Ukraine. In Donetsk and Luhansk the picture is mixed—I think this is what the hon. Gentleman is driving at—and in some parts of those two regions the legitimate civil authorities have not been able to make preparations for the elections. That remains the case with 12 days to go, so Ukraine is faced with having a presidential election in which the vast majority of people in the country will be able to take part—but not all of them, thanks to Russian intervention.

[Dr Phillip Lee (Bracknell) (Con)]

The newly appointed chief executive of Ofgem confirmed to me this morning that in his opinion gas prices in the UK would go up if there was an interruption to the supply of gas coming through Ukraine to western Europe. In the light of that, will the Foreign Secretary confirm that extensive work is taking place within Government to model worst-case scenarios, so that we can build resilience in this nation against the unlikely event of that scenario occurring?

[Mr Hague]

Yes, the Department of Energy and Climate Change is very conscious of this issue, and my right hon. Friend the Energy and Climate Change Secretary attended the G7 Energy Ministers meeting last week. I would add only that threats to interrupt the supply, with consequences not only for Ukraine but for countries beyond Ukraine, would be a further incentive for countries across Europe to reduce their dependence on Russian supplies in the medium to long term. Russia needs to bear that in mind as well.

[Mark Lazarowicz (Edinburgh North and Leith) (Lab/Co-op)]

One of the many alarming features of the situation in Ukraine is the likelihood that large amounts of arms and weaponry have fallen into the hands of not only separatists but criminals, gangsters and who knows who else. Is it not in Russia’s interests to ensure that it does not have on its borders a state where there is insecurity and armed gangs under nobody’s control? What steps can we take at the European level to try at least to monitor the entry of weapons from that part of the world into the rest of Europe?

[Mr Hague]

That is a very important issue. Part of the plan being put forward by the OSCE involves a national plan for the disarmament of illegally armed groups within Ukraine. The Ukrainian authorities have also been playing their proper part in implementing the agreement at Geneva by collecting thousands of illegally held weapons—when I last looked the figure was more than 6,000. There is therefore a national programme and an internationally supported programme for collecting those weapons, but of course the people fomenting disorder in parts of Donetsk and Luhansk are in no mood at the moment to give in their weapons. It will be in the interests of all concerned, including Russia, that they ultimately do so.

[Mr Philip Hollobone (Kettering) (Con)]

My right hon. Friend has always sensibly said that in this day and age a British Foreign Secretary has to deal with the world as it is, not as he would like it to be. Given the evidently huge support, rightly or wrongly, in Crimea for being part of Russia, is it the policy of Her Majesty’s Government that the annexation has to be undone or that the annexation is somehow regularised, ultimately to Ukraine’s satisfaction?

[Mr Hague]

It is an annexation that we cannot recognise. It is not an issue we can resolve today, but we cannot recognise this and we will bring further penalties into force, through the European Union, on companies trading from Crimea and on travel from Crimea. That is a further package yet to be agreed, but we will agree it in the European Union. The annexation has long-term consequences. Of course we have to face the possibility that this could become a long-term frozen conflict, whereby a place treated by Russia as a part of Russia is not recognised by us as part of Russia. This does not prevent us from working on the wider efforts to de-escalate tensions in the rest of Ukraine, and it is important for us not to be prevented from doing that by the Crimean issue.

[Jenny Chapman (Darlington) (Lab)]

The Foreign Secretary has made it as clear as he can that wider EU trade and financial sanctions are likely, but given the speed with which the situation is deteriorating and the loss of life, can he give us any idea of just how imminently those sanctions might be ready to be implemented?

[Mr Hague]

Sanctions can be added to at any time and on any day when it is necessary. Yesterday, following the developments of the past few days, we added to the sanctions at quite short notice, and we widened the criteria for the future so that the European Council can decide at any time to impose the wider trade and economic measures if that becomes necessary.

[Henry Smith (Crawley) (Con)]

What discussions has my right hon. Friend recently had with the US Secretary of State with regard to American support for free and legal presidential elections in Ukraine on 25 May?

[Mr Hague]

As my hon. Friend can imagine, I am in constant touch with the US Secretary of State, John Kerry. Our approaches are very closely aligned, as they are among western nations in general. I will be seeing him on Thursday to discuss our approach, particularly how we support the legitimate authorities in Ukraine after the presidential elections, so my hon. Friend can be assured that we are working very closely with the United States.

[Jim Shannon (Strangford) (DUP)]

I commend the Foreign Secretary for his strong stance on Ukraine. Just last week, I visited the Ukrainian protest and rallying point opposite No. 10 Downing street. The frustration of those present was palpable, and they referred to the annexation by Germany of the surrounding countries before the second world war. Will the Foreign Secretary reassure the rank and file Ukranians, both inside and outside Ukraine, that the west is doing all it can to turn Russia from its ambition and aspiration?

[Mr Hague]

Yes, I can. I think that the hon. Gentleman will gather from my statement that we are taking a wide range of measures, and we are stepping up those measures while all the time leaving open the door of diplomacy. That is, as I pointed out, in the interests of all the people of Ukraine, as well as those of Russia. In the absence of concrete steps to de-escalate by Russia, we will continue to increase the sanctions and the pressure on Russia, with all the consequences that I talked about earlier.

Points of Order

Tuesday 13th May 2014 Commons Chamber

13:31

[Sir Edward Leigh (Gainsborough) (Con)]

On a point of order, Mr Speaker. Sadly, you do not control when we have debates, but there is a regrettable tendency by Government now to have more and more statements on big Foreign Office issues, such as Ukraine, and fewer and fewer debates. Ukraine is a massive issue of war and peace, yet we have had just one three-hour debate on the subject. Members had only five minutes in which to speak. As the Father of the House told me, he barely draws breath in five minutes. We cannot deal with the complexities of the issue in that time. I regret to say that statements allow the Government to dominate the proceedings completely. Can you use your influence, Mr Speaker, so that we can have a proper, full day’s debate on this major international issue?

[Mr Speaker]

I am grateful to the hon. Gentleman for his point of order, and I understand where he is coming from on the matter. It is not entirely fortuitous that he should raise this in the presence both of the Foreign Secretary and the Leader of the House. I say just two things in response. First, I am sure that he would be the first to acknowledge that the Foreign Secretary is absolutely fastidious about coming to the House when it is appropriate to do so, and he has always volunteered statements without any pressure being required to be applied to secure that outcome. Secondly, I rather agree that it would be good if we could have a more substantial debate on these matters. As he rightly says, with sadness—a sadness that I share—it is not in my hands; it is in the Government’s hands and I hope that it will happen sooner rather than later so that these matters can be explored in the detail and at the necessary length that are required.

[Mr Simon Burns (Chelmsford) (Con)]

Further to that point of order, Mr Speaker.

[Mr Speaker]

I am not sure that there is one, but, as I always operate according to my standards rather than those of the right hon. Gentleman, I will be generous to him. Let us hear from him and see whether he has anything worthwhile to raise.

[Mr Burns]

To paraphrase, I am most grateful, Mr Speaker. Will you confirm that the same problem arises with urgent questions, but the Government have no control over the choosing of them?

[Mr Speaker]

It is not the same problem at all. It is a different issue, and different principles apply. I was hopeful that the right hon. Gentleman might have a valid point to raise, but it was a question of a triumph of optimism over reality.

[Tessa Munt (Wells) (LD)]

On a point of order, Mr Speaker. I would be grateful for your guidance on the following matter.

On 4 April, Monitor, the sector regulator for health services in England, issued new guidance for the commissioning of radiosurgery services. That new guidance clearly updates and modifies the guidance issued in 2013.

The new guidance means that NHS England’s ban on NHS patients being treated by the gamma knife machine at University College hospital, London is not sustainable. In the past couple of weeks, I have asked three questions of the Secretary of State, and I made it clear that they related to the new guidelines that were issued on 4 April. I stated:

“To ask the Secretary of State for Health pursuant to section 3 of the guidance issued by Monitor on the commissioning of radiosurgery services on 4 April 2014”.—[Official Report, 7 May 2014; Vol. 580, c. 245W.]

I then led into my questions. The Under-Secretary of State for Health, the hon. Member for Battersea (Jane Ellison), answered all three questions in the context of the outdated Monitor guidelines. I understand that that might be an error on her part, but it means that my legitimate questions remain unanswered, and I do not know how else to get an accurate response to oral and written questions. I seek your guidance, Mr Speaker, on how to redress that.

[Mr Speaker]

I am deeply grateful to the hon. Lady for her courtesy in giving me advance notice of this point of order. Moreover, I understand why she is frustrated or aggrieved that what she thinks is a clear and specific question is not being answered. That said, I am sorry to inform her that there is nothing in what she has said that engages the responsibilities of the Chair. I must therefore advise her to undertake the short journey from here to the Table Office where I have every confidence that she will get good advice on the best means by which to chase down this matter. If that proves to be unavailing, she might consider having a friendly and genial chat with the Leader of the House, who I am sure will wish to assist. If that gets her nowhere, I have the feeling that she will probably come back to me. Perhaps we can leave it there for today.

Prohibition of Unpaid Internships

Tuesday 13th May 2014 Commons Chamber

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

13:36

[Alec Shelbrooke (Elmet and Rothwell) (Con)]

I beg to move,

That leave be given to bring in a Bill to prohibit unpaid internships; and for connected purposes.

The principle of this Bill is to encourage responsible practice which does not inhibit social mobility and limit experience of competitive working environments to the few who can afford to work without pay. It cannot be disputed that unpaid internships are an impediment to social mobility when, according to a YouGov poll, 43% of 18 to 24-year-olds believe unpaid internships act, or have acted, as a major barrier to getting a job. It is alarming that they have been allowed to continue for so long, especially as Governments of all colours spend huge amounts of time and money to ensure that the school and university system gives a fair opportunity to all. By turning a blind eye to this unfair internship practice, many school leavers and graduates never get the chance to use their education to its full potential.

Indeed, in Alan Milburn’s report into social mobility in 2012, he found that more than 30% of newly hired graduates had previously interned for their employer, rising to 50% in some sectors, underlining the fact that interning is becoming a prerequisite for graduates looking to access professions. That leaves thousands of young people in a Catch-22 situation, unable to get a job because they do not have the experience, and unable to get experience because they cannot afford to work for free.

There needs to be continuity through the entire journey of education, college or university and into the world of work. I am sure that many Members from all parts of the House would baulk at the idea of children getting access to a decent education only if they have a wealthy background, but that is the situation we are allowing to continue in the early employment market today. Indeed, many Members across this House are complicit in encouraging it, but they are not the only ones. Despite the coalition agreement to tackle internships, and the strong guidance from the Department for Business Innovation and Skills, many employers still routinely advertise for unlawful internships on a widespread scale—from fashion to journalism. Just last year, the National Council for the Training of Journalists found in its 2013 report that 82% of new entrants to journalism had done an internship, of which 92% were unpaid.

It is not just those who do not have the money who are being deprived of life skills. Internships are also not beneficial for those who are lucky enough to have other means of support, who cruise into positions where there is no competition owing to the costs involved.

By widening the opportunity for all, the job market becomes genuine and everyone is forced to up their game to secure the best internship or, failing that, to settle for a position most suited to their skill level in preparation for a step up. In other words, it makes everyone experience the real world, where people are appointed to jobs on merit, rather on the basis of the circumstances into which they were born. I draw a huge amount of experience from my own early employment doing manual work in engineering factories and, later, as a kitchen and bathroom fitter, which gave me something that an unpaid internship simply does not provide—a self-sufficient existence brought about by merit and hard work.

At my local comprehensive school, my sister and I were taught that hard work and determination would help us make something of ourselves in the world of work. Our supportive parents made us work part-time jobs around our education—something that taught us the real value of money, that we had to do to run our first cars and that taught us how to budget, a valuable lesson for later life. I left home for university with a sense of aspiration to achieve my dreams, knowing that it would be my own hard work and determination that delivered those dreams.

Unpaid work was simply not an option for me or my sister, and it should no longer be a barrier to ordinary kids, as we were, to get into the workplace. In the 21st century, it is time to ban the practice of unpaid labour. Of course, that is no small task, as the Institute for Public Policy Research estimates that there are more than 100,000 unpaid internships. It is exactly the scale of the problem that makes it time to act. There is a need to act to protect young people as they get into work, as well as to support the businesses that are doing the right thing.

A step change can be achieved through better enforcement of the national minimum wage, as has been introduced by the Government, alongside constructive dialogue with employers. Those who defend unpaid internships as a way of helping squeezed businesses are guilty of taking a short-sighted and ill-informed approach, as fair internship schemes are better for employers, because they allow them to access a wider and more diverse pool of talent. Furthermore, not only are jobseekers’ opportunities being limited by unpaid internships, but businesses offering free positions are undercutting their rivals who abide by the moral and legal code and pay the minimum wage.

The Low Pay Commission, for its report in 2013,

“received a substantial volume of evidence suggesting a growth in the terms ‘internship’, ‘work experience’ or ‘volunteer’ to denote unpaid activities that look like work and to which the NMW should apply”.

The minimum wage has got to be the way forward to make unpaid internships a thing of the past and to create fair intern positions, in which interns are treated in a manner that fits the role that they are carrying out. After all, most interns have set hours and responsibilities, and they are therefore workers, who should be entitled to the national minimum wage.

To those who say that extra legislation is not needed, because of the existing legal framework of the minimum wage, I point out that there has not been a single prosecution for non-payment of the national minimum wage in the past two years. There have been only eight prosecutions since the law was passed in 1998. We need to ensure that the law protects social mobility, while acting as a credible deterrent to businesses that would not want to be caught jeopardising someone’s future for a bit of cheap labour.

Since the first report by Alan Milburn in 2009, much of the debate surrounding the issue has recognised the link between unpaid internships and declining social mobility. The report described that internship model as

“a back-door for better-off, better-connected youngsters”.

It is therefore heartening that a naming-and-shaming approach towards the back door is now being heeded and implemented by a range of employers, such as Ernst & Young and KPMG, and employer bodies, including the Public Relations Consultants Association, the Arts Council and the Royal Institute of British Architects, which actually expels members that use unpaid interns.

When international organisations, including the European Commission, OECD and the UN are all concerned about the effects of unpaid internships on social mobility, it shows that we have already been too slow, as a global leader, in responding to the practice. Let us move forward with common sense and tackle the weak spot in employment law whereby workers are not clearly defined, allowing employers to exploit the loophole. At no point in national minimum wage legislation is a “worker” defined sufficiently. It has also been noted that advisers at Her Majesty’s Revenue and Customs are not consistent in their advice about when the national minimum wage is warranted, and when it is not.

A common-sense approach would be to ensure that no work experience is to last longer than four weeks without being paid; at that point, an individual should become an intern and be paid the national minimum wage as a minimum. The change would safeguard opportunity and only requires using powers under section 41 of the National Minimum Wage Act 1998. With the help of Intern Aware, a leading charity that supports the ending of unpaid positions, it has been identified that the Government could give clarity to interns, those on short-term work experience and employers. The change would require secondary legislation and therefore not interfere with existing national minimum wage rules, but it has the potential to designate all individuals who have undertaken a period of work experience for more than four weeks to be a “worker” under the National Minimum Wage Act, thereby ensuring that they are properly treated and recompensed.

I urge the Government to act at the earliest opportunity. I ask for support from both sides of the House. Until amended to make the rules suitable for the modern-day working environment, we are compromising all the progress made by this Government to enable a fair education system for all, regardless of background. It is time that we not only practised, but legislated, what we preach. In a nation such as ours, no one should be expected to work for free. Work should be rewarded. Those who oppose the Bill need to be able to explain to young people why only their wealthy peers should have access to sought-after careers. The Bill moves us into the 21st century, leaving the remnant of the “who you know, not what you know” culture firmly in the history books.

13:45

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op)]

I oppose the Bill and I want to give my reasons briefly. Most people who know me might think that I would support the Bill, but the unintended consequence would be to damage some important opportunities for young people in our country. I absolutely agree with the overall purpose of the Bill, but it will not hit the target. I am against exploitation and I am for fairness and social mobility, but I am also in favour of young people getting the experience that they need to enter the workplace. We need a balance.

I chair the schools to work commission and listened with great interest to Jim Hillage from the Institute of Employment Studies, who pointed out that, according to the latest high-flyers research programme, a survey of 18,000 students found that students—any student—who had any work experience at all were three times more likely to get a job. Not only were they more likely to get a job, but they were more likely to stay in a job. They got confidence and a feeling of comfort from joining the work force.

Many of us have offered short-term work experience in our offices to young people whom we want to encourage to get to know the world of work and to understand how Parliament works. The emphasis on only having a paid intern in this place, however, has put MPs off taking on more people in their office. Last year, I paid a full London living wage to an intern, and that was good. I wanted to do that and I want to do it more often, but it squeezed out a lot of young people to whom I used to offer short-term work experience while paying their expenses and even the expenses of staying in London.

There are some problems in going down this route, because in some ways it sends the wrong message to many enlightened employers who go out of their way and know that a young person needs a start—a start that often involves a couple of weeks in a business environment. I do not want a heavy-handed approach that says we should have nothing but paid interns because of where that will put those great employers in the public and private sectors, including those in small and medium-sized companies. Most people in this country will end up working not at the large companies, the big accountancy firms or the big engineering and chemical companies but for small and medium-sized enterprises. I want us to have a more positive approach through a charter on the fair treatment of young people doing work experience that everyone understands and that they sign up to.

I am positively against people who cynically exploit young people and take them on unpaid for long periods of time. We all know, and I agree with the hon. Member for Elmet and Rothwell on this point, that that is the downside. Where we disagree is on whether we should ban any internship that is not paid. I must say, Madam Deputy Speaker, that I welcome Mr Speaker’s initiative in this House but that very good initiative of taking on young interns, rewarding them and so on is for only 10 people. Is it not about time that even in this House of Commons we said that we should open up such opportunities to lots of young people who otherwise would not have the opportunity? Let us have a proper scheme. Let us talk to the Independent Parliamentary Standards Authority and say that we all need the money to take on three young people every year in our offices and to have a fair way of choosing them.

I could take on a local doctor or accountant’s son or daughter every week. We all know how the system works and, I think, most of us are against it, so I go out of my way to find young people with no other chance at all of pitching up from Huddersfield in West Yorkshire to work in this environment. I work very hard to go out and find them, recruit them, bring them in and give them that chance. Obviously, I can often only offer a week or two, but I do not want us to do anything heavy-handed today that suggests to us or anybody else that the easy approach is to ban all unpaid experience. I know that part of the hon. Gentleman’s Bill addresses that point, but not enough of it does. I do not want such a message to go out to the outside world.

We should be very careful. I have noticed that in some areas the campaign for a ban on unpaid internships is shrinking the number of employers who are willing to give a child their very first chance. I hope that colleagues will not support this approach, which is too heavy-handed, and will join me in saying that we should take positive action that encourages more people to offer work experience and that is designed so that it does not simply bring someone in and make them do a bit of computer work, shredding or filing. Internships, if they are good, should be well organised, well scheduled and a positive and life-enhancing experience. If young people get that experience, they get the opportunity to start their career in a positive way. I oppose the Bill.

Question put (Standing Order No. 23).

13:52

Division 274

Ayes: 181

---

Labour: 150
Conservative: 16
Liberal Democrat: 11
Plaid Cymru: 2
Democratic Unionist Party: 1

Noes: 19

---

Conservative: 18
Labour: 1

Ordered,

That Alec Shelbrooke, John Stevenson, Mr Robert Buckland, Dr Matthew Offord, Mike Crockart and Dr Julian Huppert present the Bill.

Alec Shelbrooke accordingly presented the Bill.

Bill read the First time; to be read a Second time on Thursday 15 May and to be printed (Bill 209).

Consumer rights bill (Programme) (No.2)

Ordered,

That the Order of 28 January 2014 (Consumer Rights Bill (Programme)) be varied as follows:

(1) Paragraphs 4 and 5 of the Order shall be omitted.

(2) Proceedings on Consideration and Third Reading shall be taken in two days in accordance with the following provisions of this Order.

(3) Proceedings on Consideration shall be taken on the days shown in the first column of the following Table and in the order so shown.

(4) Proceedings on Consideration shall (so far as not previously concluded) be brought to a conclusion at the times specified in the second column of the Table.

Table

Proceedings	Time for conclusion of proceedings
First day
New Clauses and new Schedules relating to public services, guidance or access to data	Two hours after the commencement of proceedings on Consideration on the first day
New Clauses and new Schedules relating to consumer credit or debt management; new Clauses and new Schedules relating to Part 1; amendments to Part 1	The moment of interruption on the first day
Second day
New Clauses and new Schedules relating to Parts 2 or 3; amendments to Parts 2 or 3; remaining new Clauses and new Schedules; remaining proceedings on Consideration	Two hours after the commencement of proceedings on Consideration on the second day

(5) Proceedings on Third Reading shall (so far as not previously concluded) be brought to a conclusion three hours after the commencement of proceedings on Consideration on the second day.—(Jenny Willott.)

Consumer Rights Bill

Tuesday 13th May 2014 Commons Chamber

[1^st allocated day]

Consideration of Bill, as amended in the Public Bill Committee

New Clause 1

Independent advocacy: report

‘(1) Within three months of Royal Assent of this Act the Secretary of State must publish a report detailing how—

(a) better outcomes for consumers of public services; and

(b) more efficient decision-making processes,

will be ensured.

(2) A report under subsection (1) will consider—

(a) how each public service provider will ensure a formalised approach to ensuring independent advocacy is available for consumers at an early stage in the decision-making process for the provision of public services;

(b) the nature of an independent advocate to participate in this process, and the definition of independence, including how this could be supported by the conduct of any service provider;

(c) the effect of a breach in a consumer’s statutory rights as set out by this Act when a direct commissioning contract is in place;

(d) what formal status any independent advice provided will have in relation to decision-making, in particular, in instances where a public service continues to act contrary to such information and formal legal redress is sought;

(e) the role of the public sector ombudsman services in overseeing any such approach under paragraph (a);

(f) how a public service provider will report on their formalised approach under paragraph (a); and

(g) how the approach under paragraph (a) would ensure all consumers of services covered by this Act have access to a licensed alternative redress mechanism.

(3) For the purposes of this section a public service is any provided to the consumer directly by—

(a) a Government department;

(b) a local or public authority; or

(c) a trader acting on behalf of these organisations.

(4) For the purposes of this section a person shall be a consumer of public services under a “direct commissioning contract” when they enter any—

(a) agreement;

(b) contract;

(c) consumer notice; or

(d) proposed contract,

for receiving a service which the person has a direct role in commissioning.’.—(Stella Creasy.)

Brought up, and read the First time.

14:05

[Stella Creasy (Walthamstow) (Lab/Co-op)]

I beg to move, That the clause be read a Second time.

[Madam Deputy Speaker (Dawn Primarolo)]

With this it will be convenient to discuss the following:

New clause 2—Guidance for statutory regulators

‘(1) Within three months of Royal Assent of this Act, the Secretary of State shall publish guidance based on the work of the Implementation Group.

(2) Guidance published under section (1) shall—

(a) detail how consumers should be informed of their rights and at what point this should happen;

(b) ensure that traders have the information they need regarding their responsibilities under this Act and other consumer rights legislation;

(c) define what may be a “reasonable time” for consumers to secure refunds, repairs or replacement, or repeat performance; and

(d) specify the sanctions available to enforcement agencies in cases where the guidance has not been followed.

(3) Within six months of the publication of guidance under subsection (1), the Secretary of State shall issue a code of practice in relation to the exercise of any and all the functions set out in the guidance, subject to the provisions of subsections (5) to (7).

(4) Any person exercising such a function must have regard to the code in determining any general policy or principles by reference to which the person exercises the function.

(5) Where the Secretary of State proposes to issue a code of practice under subsection (3), he shall prepare a draft of the code, and shall lay the draft before Parliament.

(6) Where the draft laid before Parliament under subsection (5) is approved by resolution of each House of Parliament, the Secretary of State shall issue the code.

(7) A code issued under subsection (6) shall come into force on such date as the Secretary of State may by order made by statutory instrument appoint.’.

New clause 3—Access to data

‘Schedule [Access to data] has effect.’.

New clause 4—Guidance based on the work of the implementation group

‘(1) Within three months of Royal Assent of this Act, the Secretary of State shall publish guidance based on the work of the Implementation Group.

(2) Guidance published under subsection (1) shall—

(a) advise on the period that a trader may retain sums paid by the consumer for services not yet supplied by the trader, where it is the consumer who dissolves the contract;

(b) further to paragraph (a), advise on the terms under which traders should manage the interest on such sums and make provision for the return of this interest to the consumer; and

(c) advise on whether it should be permissible to charge for a guarantee where that guarantee does not offer any undertaking to the consumer additional to their rights as set out in this Act.’.

New clause 5—Independent consumer advice

‘Within three months of this Act receiving Royal Assent, the Secretary of State shall produce guidance setting out requirements for all statutory regulators to report annually on the provision of independent advice which is free at the point of delivery, and to make recommendations on ensuring consumers’ rights are protected.’.

New clause 10—Powers of the Information Commissioner: nuisance calls

‘(1) The Data Protection Act 1998 is amended as follows.

(2) In section 40 (Enforcement Notices), leave out subsection (2).

(3) In section 55A (Power of Commissioner to impose monetary penalty), leave out subsection (1)(b).’.

New schedule 1—‘Access to data

Information for consumers

1 The Secretary of State shall report to Parliament within six months of Royal Assent of this Act setting out how consumers will have access to the information they require in order to make informed assessments of prices, charges and fees.

Supply of customer data

2 A report under paragraph 1 shall include details of how the Government intends to—

(a) make regulations to require all regulated persons to provide customer data relating to transactions between the regulated person and the customer, as set out in section 89 (Supply of customer data) of the Enterprise and Regulatory Reform Act 2013;

(b) enable third parties to make requests for customer data under section 89(1)(b) of that Act; and

(c) ensure customer data is provided in a form which enables the customer or third party to assess whether the price they are paying for a service is reasonable, which should have regard to section 89(7) of the Enterprise and Regulatory Reform Act 2013.

Designation of regulated persons and regulatory bodies

3 A report under paragraph 1 shall—

(a) review which traders, including the activities of any government, or local or public authority, as defined by section 2 of this Act, shall be considered a regulated person under section 89(2) of the Enterprise and Regulatory Reform Act 2013; and

(b) identify a relevant regulatory body to undertake the duties set out in paragraph 4 of this Schedule.

Guidance for regulated persons

4 A report under paragraph 1 shall include details of how the Government intends to require regulators of services which are provided by regulated persons, as defined in section 89(2) of the Enterprise and Regulatory Reform Act 2013, to produce guidance on the implementation of section 89 of that Act.

5 Guidance produced for regulated persons under paragraph 4 shall include—

(a) how regulated persons should provide customer data;

(b) details on the ownership of customer data which shall include, but is not limited to—

(i) that customer data generated directly, at any point in the course of a contract, is owned by the customer;

(ii) that prior to any decision requiring the transmission of data in a format where the customer can be identified to a third party, direct consent of the customer as owner of the data must be secured; and

(iii) how regulated persons should recognise and publicise that such data is owned by the customer;

(c) how customers may consent to their data being shared with third parties under section 89(1)(b) of the Enterprise and Regulatory Reform Act 2013;

(d) specify sanctions for traders who are not able to confirm the consent of the customer to sharing their data;

(e) measures to limit the amount that may be charged for any such single request for data on behalf of multiple customers;

(f) how regulated persons, who hold data on customers on behalf of any government, local or public authority, can use this information to secure social and consumer benefits; and

(g) how regulated persons, who hold data on customers on behalf of any government, local or public authority, can contribute to a report under paragraph 7.

Access to information: public services

6 (1) The Secretary of State shall report to Parliament within six months of Royal Assent of this Act on how the Government intends to ensure that all consumers of public services, who have a direct role in commissioning them, are able to access information regarding any consumer contract or consumer notices which may reasonably be understood to apply to them.

(2) A report under sub-paragraph (1) shall have particular regard to—

(a) the access to information that consumers of public services require; and

(b) how access to information can ensure greater transparency on the work of traders.

(3) For the purposes of this paragraph, “public services” means the work of any government, local or public authority or traders offering services on their behalf.

Access to information: annual report

7 (1) The Secretary of State shall produce and submit to Parliament an annual report setting out an analysis of the cumulative costs and benefits of Government decisions relating to the rights of consumers and protection of their interests.

(2) A report under sub-paragraph (1) shall in particular address the effect on—

(a) household consumption;

(b) vulnerable households; and

(c) any other subjects as the Secretary of State decides.’.

[Stella Creasy]

We come to the Report stage of the Consumer Rights Bill. I am minded of the words of the great English churchman Thomas Fuller, who said that our lot was to be born crying, live complaining and die disappointed. Of course, as true Brits, we know that that approach can be best encompassed in a “tut”, but we see the Bill as offering much more than a “tut” for people who have been ripped off. We see the potential of the Bill to free us of that particular malaise, and with that in mind we have tabled a number of amendments that we hope will receive the support of the House.

We believe that the Bill should be subject to the tests—that they should be performed with reasonable care and skill—that it sets for goods and services. At the moment, it is found wanting, and that is why today we are looking for a repeat performance and hope of speedy redress. The new clauses speak to that and in particular to the Opposition’s approach to consumer rights, which should not be only about dealing with problems when something has gone wrong, but, when done well, could avert problems. For that to happen, consumers need three things—more information, strong advocacy and speedy forms of redress.

In introducing the Bill, the Minister has opened a veritable Pandora’s box, given how some of its clauses will be perceived on the consumer landscape in the UK. We are mindful that hope lies at the bottom of Pandora’s box, and we hope with the new clauses to bring hope for how consumer rights legislation could work. Let me explain what I mean. I want to turn first to new clause 3 and new schedule 1, which new clause 3 brings into effect. The schedule refers to the first principle to which I referred—information. How do consumers get the information that they need to make the right choices for themselves the first time? We know that having access to more information is vital to empowering consumers.

The Government’s research, “Better Choices, Better Deals”, argues that if consumers were able to use price comparison sites more effectively, they could gain £150 million to £240 million a year. That is why the Opposition welcomed many of the ideas and intentions behind the midata project to give consumers more access to their information in a portable and accessible format. In Committee we expressed concern that, despite the project, four years on, it is not really working. There is a lack of information coming forward to consumers. The Minister defended the slow progress of the midata project, telling us that taking action now would prejudice the results of a review of the project that she has commissioned, and she did not think that that would be beneficial to the programme or, ultimately, to consumers. We have tabled the new clause and schedule because we fundamentally disagree. We want to go much further.

Currently the midata project covers four areas of consumer data, but we think that the power in the new schedule offers the potential for a framework for improving consumer and citizen access to data in a way that can transform outcomes and improve our consumer markets; that would be good for business and good for Britain.

We do not understand why the Government gave themselves the power, under the Enterprise and Regulatory Reform Act 2013, to enact the midata project and yet have not done so. The first thing that new schedule 1 does, therefore, is put that power into effect to ensure that consumers get the information they need, in a portable and accessible format, about a key utility bill.

Every time we click, we create wealth—whether we are giving our contact details or browsing online, companies are harvesting information that drives their marketing and product development. Datasets such as store loyalty cards, medical records or tax affairs are an important and revealing resource for both the public and the private sector. Facebook is making more money than any of us can dream about from the content that we are creating. That stream of data should not be one-way. Citizens and consumers should have access to those data in a meaningful way, which allows them to start calling for the kind of products and services that they want.

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

My hon. Friend is making a number of key and critical points about the potential power of data in both the consumer and the public sector. Has she been able to detect a strategic or coherent approach to data access from the Government in respect of the Bill?

[Stella Creasy]

I pay tribute to my hon. Friend for the work that she is doing in the digital review that she is conducting for Labour, which reflects precisely what she is talking about—a strategic approach. That stands in stark contrast to the shambles that we have seen in relation to the care.data project, the tax return data project and some of the amendments that have been tabled to the Deregulation Bill.

This Government talk about data being like oil—a resource that can be exploited to make new industries and potentially huge profit margins. If we are creating it, however, we should also benefit from it. That is why in the new schedule we have set out a framework to enable that. We want to make sure that the British public are firmly in charge of their own data, so that they benefit from those data and how they can be used.

This should happen not just in the private sector, through the midata project, but in the public sector. It is important that we flag that up, not least because when the Bill was originally proposed, and in Committee, the Minister tried to tell us that it had no relevance to the public sector. She told the Committee:

“The purpose of the Bill is to look at the rights that consumers have in their relationships with business; it is not to look at any rights that consumers have when it comes to public services.”––[Official Report, Consumer Rights Public Bill Committee, 11 February 2014; c. 66.]

Only when we questioned her in the Committee did she admit that the provisions of the Bill affect the public sector. That gives us the opportunity to ask how we can ensure that consumers and citizens have access to data to make good choices in both the public and the private sector.

So far the Government have admitted that the provisions cover valuable benefits such as personal health budgets, university tuition fees and child care vouchers. Given the framework that the Government have set out, we think that the licence fee, perhaps controlled parking zones, bus fares and possibly even water and sanitation services—directly provided services that consumers pay for and for which they therefore have a contract with the provider—should also be covered.

There are concerns about access to services in the public sector, which the amendments would address. One in five of us has experienced a problem with public services in the past year, but a third of us who have experienced a problem with the public sector do not complain. We are what the Public Administration Committee has called a nation of “silent sufferers”. “More complaints please!” is the title of its report. That is not what is coming forward from the public.

As we all know, good complaints help to generate feedback. They therefore help to make services in the public and the private sector more responsive. I estimate that two thirds of our casework as MPs is about public service decisions gone wrong. Much of that is to do with what we would recognise in the private sector as information asymmetries—people not knowing what services they are entitled to and therefore getting a raw deal.

New schedule 1, which is inserted by new clause 3, is about the lessons that we can apply from the midata project to information across our lives in both the public and the private sector. We know that sharing data directly with citizens can help reform public services and improve outcomes, but we also recognise that the relationship that people have with the public sector is different from their relationship with the private sector, so regulators should look at how to make it work in both fields. We recognise that we are both providers of public services, as taxpayers, and also users and consumers of public services in our daily lives.

The benefits that come from releasing data in the public and the private sector are manifest. We need a clear framework to make sure that it is not only those with the loudest voices or the largest wallets who are able to access the benefits, whether it is giving patients the information they need on their health care to manage conditions for themselves, improving parent and pupil involvement in schools, or communities designing their own cities. The benefits from this process could be legendary, but the Bill does little to move that debate forward. Our concern is that as currently drafted the Bill could create further inequalities, as those who understand their rights in the public sector are able to use them but those who do not cannot.

Let me explain how we think the issue could be addressed. New schedule 1 is about access to information, allowing people to make the right choice the first time. New clause 1 acknowledges that choice is not enough to guarantee a good outcome. People often need an advocate, an expert or an adviser with whom to work through the options and decide what works for them. New clauses 1 and 5 both introduce a clear commitment to advocacy in the public and the private sectors to help improve the relationship betweens service providers and service users.

In the public sector, advocacy can not only improve outcomes but cut costs. A study in Nottingham showed that 60% of cases that a local advice provider was working with involved public sector decisions made badly the first time. Involving advocates reduced the number of complaints by 30%, reducing the burden on the public sector and improving outcomes for the users of services. It is a win-win scenario. The more challenge there is in the public sector, the more information and the more advocacy in the private sector, the more we can make our markets work better and our services serve our people.

However, it is clear from the work that we have done since the initial conversations in Committee that that approach, ethos and understanding of what the Bill could do for the public sector, how information could make a difference, and how advocacy could be beneficial, has not been progressed in Government discussions. It is worrying to us on the Opposition Benches to discover that, having admitted that the Bill will cover sections of the public sector, the Minister has not had talks with the Department for Culture, Media and Sport about what that might mean for the licence fee.

Many of us might have watched the Eurovision song contest on Saturday night. Many of us might have had comments about the coverage—some supportive, some negative. Under the Bill, it could be argued that we have a right to a service performed with reasonable care and skill, so if we did not think that Graham Norton was the most erudite host, we could make a complaint. In theory, under the Bill, we would have a right to a repeat performance, a price reduction or a refund. That has huge ramifications for the BBC and for the licence fee, yet no conversations have yet taken place between DCMS and the Department for Business, Innovation and Skills on the matter. We are also told that the Minister has not spoken to Ministers in the Department for Education about how the Bill covers child care tax vouchers, yet she admits that it does. Clearly, the Bill opens up the possibility that some parents will be able to use such rights to challenge the provision of nursery services in their areas, whereas others who do not know their entitlement will not.

We know that the Minister has at least spoken to the Department of Health about how the provisions will affect personal care budgets. She has, apparently, had regular informal contact. Given that many of us know that the silent sufferers are often incredibly vulnerable people, frightened of complaining about a carer because they are frightened of what will happen next, regular informal contact, I would wager, does not cut it when the Bill could transform what happens.

The Minister has, however, spoken to some people in her own Department about tuition fees. Unfortunately, the Minister with responsibility for higher education tells us that no meeting has taken place with external stakeholders about how the Bill will affect tuition fees. That might be because in Committee the Minister was not entirely sure whether students were consumers—having spoken to students about their consumption patterns, I think we can agree that they are when it comes to paying tuition fees. That is why, when the Minister responsible for higher education tells us that there have been no meetings with student representatives, higher education providers and universities on the implications of the Bill, we are rightly worried. The new clauses are needed to put in place a framework to understand those implications.

Many of us may remember some of our university lectures, some positively, some negatively. The fact that we would have the right under the legislation to complain that they had not been prepared or delivered with reasonable care and skill opens that Pandora’s box. That is why the National Union of Students has said that it is concerned about how the Bill is drafted and the possibility that legal redress could be easier and more effective for students with greater resources, whether in terms of finance or access to legal services.

[Chi Onwurah]

My hon. Friend is making some powerful points about the rights of consumers and public service users. Does she not find it strange that parties that are so keen to turn passengers and patients into consumers now do not seem to understand the implications of giving potential public service users consumer rights?

[Stella Creasy]

I absolutely agree. We all want to see an empowered citizenry. We believe that would be positive for our public services by encouraging feedback on how services work for the public. But the risk with the Bill as it stands is that those with sharp elbows will do well and those without will simply be left behind. I think that is why both Citizens Advice and Unison, which after all has considerable expertise in some of these relationships, support the amendments and say that they want to see further debate and scrutiny on how we ensure that we do not have a two-tier system, with only those services that have a direct relationship getting better service responsiveness because of such legal rights, and only those people who can access services and complain getting those rights.

Trading standards has told us how it often refers people to what it calls the “sausage machine” of local council complaint services. Under this new legislation, it is not clear whether trading standards would then be able to pick up issues. That could lead to real inequalities in both the public and private sectors without advocacy and clearer information rights, which is why we have tabled the amendments.

I also want to draw colleagues’ attention to paragraph 5 of new schedule 1, which we also believe will tackle nuisance calls. We recognise that the misuse of data is as important as the analysis of data and that there is a need to put in place a proper framework on that. Many of us will have had constituents complain about nuisance calls and texts. Indeed, only this afternoon, while waiting for this debate, I received a text telling me that I could get compensation for an accident that I have not had—perhaps it came from the Government Whips.

However, we know that there is a gap at the moment where it is hard for the Information Commissioner to prove that there has been a lack of consent, where companies themselves will not be clear about whether they have the consent of the person they have bombarded with text messages and phone calls. In one six-month period alone, 71% of landline customers said that they had received a live marketing call and 63% said that they had received a marketing message. We also know that the Information Commissioner receives about 2,500 complaints a month about unsolicited text messages. We want to close that loophole. The all-party group on nuisance calls also recommended tightening the rules on consent, and Ofcom has said that it agrees. Indeed, the Government’s own report on the nuisance calls action plan said that we should do more on consent.

Paragraph 5 of new schedule 1 would enable fines to be imposed for those people who do not show that they have the explicit consent of consumers to send them that kind of marketing message. We think that is entirely proportionate and hope that Government Members, even if they are scrabbling to understand quite what the Bill would do in the public sector, will recognise the issue of nuisance calls and act accordingly to address it. I would also encourage those among us who speak up for taxpayers—perhaps Gary Barlow should take note—to support new schedule 1.

[Mr Iain Wright (Hartlepool) (Lab)]

Take that.

[Stella Creasy]

Indeed. “Take that” is the answer we would give on many of these things.

New schedule 1 looks at the cumulative impact of Government policy on households. Currently, among European nations only Estonia has a worse proportion of people struggling to pay their energy bills than the UK. Yet one of the issues that have been debated across the House is the impact of some of the long-term planning on the infrastructure building projects for our energy system in this country and the consequences for energy bills. Indeed, in November last year the National Audit Office published a damning report stating:

“Government and regulators do not know by how much overall expected new investment by the private sector in infrastructure will increase household utility bills and whether bills will be affordable.”

We know that the concept of affordability is contested by some, and we know from the evidence the Department for Environment, Food and Rural Affairs gave the Public Accounts Committee that it does not even have a target for affordability in relation to water bills. Yet many of us will have seen at first hand in our constituencies how people are struggling with those basic costs of living. We think that the Government should be able to publish an analysis of the impact of their own policies on the cost of living. Paragraph 7 of new schedule 1 asks for such a report to be provided by the Treasury. I am sure that Government Members who support transparency will want to support it.

I will say a little about new clause 2, which concerns implementation. After all, we think that with this framework we are offering the Government a way forward on information and advocacy, but we also recognise that it is no good having rights written on paper if they are not a reality in practice. One of the concerns that came up repeatedly in Committee—many of the Opposition amendments that the Government opposed related to this—is how consumers will actually access rights in practice. When will they know that they have a right to a repeat performance? At what point will the BBC tell us that we have a right to a price reduction because we did not like its commentary?

Those are all questions that the Minister said would be dealt with by the implementation group. It became a mythical beast in our minds, because it will cover so many issues, from point-of-sale information, information on remedies open to consumers, how businesses should be informed of these rights, the length of time before people can get a refund, the time limits people would get on a repair, replacement or repeat performance, or even testing consumers’ understanding of their rights.

Time and again the Minister said that we should leave it to a body of experts, which we believe—we are not entirely sure—includes organisations such as Citizens Advice, Which?, the Trading Standards Institute, the British Retail Consortium and even the Financial Conduct Authority. They are worthy bodies indeed to look at these issues, but we had some concerns in Committee, having seen some of the minutes of their meetings, which are not very frequent. Despite their good works, any recommendations they make would not be statutory guidance. Therefore, new clause 2 simply states that the recommendations they make about the rules on how the Bill should be implemented should have meaning, that they should have real teeth, that it is no good saying that it would be good for consumers to be informed of their rights if that does not actually happen at the coal face or at the shopping till.

In proposing this first group of new clauses, we are trying to make this Bill what it could be. We are trying to find the hope at the bottom of Pandora’s box. We are trying to ensure that consumers have access to the information and advice they need to make good choices the first time around. The old model of politics, in which progress depends on centralising these abilities, will no longer work with our communities. The task at hand, we believe, is to give the public more control and more power over their lives to enable them to make the choices that they want to make first time. As it stands, the Bill will leave citizens to navigate services alone, without the resources, either money or skill, to struggle to make them work.

We want to do something different. We want to reform the public sector by devolving power to people, investing in the prevention and co-operation they need to make services work for them, to stand shoulder to shoulder with every consumer and every citizen, not blunting the efforts of those who already fight for services, but enabling more people to give the feedback about the kinds of services we want in the public and private sectors. We believe that new clauses 1, 2, 3 and 5 and new schedule 1 will enable that framework to be put in place, and we hope that the Government will respond positively to the points that we have made as a result.

[Yvonne Fovargue (Makerfield) (Lab)]

I rise to speak to new clause 10, which stands in my name. Although I support paragraph 5 of new schedule 1, it is not just the lack of consent that I think is the problem with nuisance calls. My new clause has been promoted by the huge growth in nuisance calls and messages. In fact, on each occasion when I have been out on the streets recently, at least three people have come up to me to talk about the explosion in unsolicited contacts and said, “Can’t something be done?” There is a weak data protection regime and consumers feel that they have lost control of their personal information.

I am convinced that if I was on a desert island the first call I would receive would be someone offering me a loan to get off the island. For people in financial difficulties, in particular, nuisance calls and text messages offering high-cost credit, such as payday loans or fee-charging debt management services, can lead to the temptation to take out products or services that, if mis-sold—they often are—could substantially worsen their situation.

StepChange has done some research that shows that 1.2 million British adults have been tempted to take out high-interest credit as a result of an unsolicited marketing call or text. There is legislation to protect consumers against these practices. Unsolicited promotional electronic messages are banned, but the ban is widely flouted and inadequately enforced. My new clause would lower the threshold for firms breaching the Act. At the moment, the Information Commissioner’s Office can issue enforcement notices against these companies only if “damage or distress” can be demonstrated. It can also issue monetary penalties to firms misusing consumer data or breaking the laws on electronic communication under section 551 of the Data Protection Act, but only if

“substantial damage or substantial distress”

to the consumer can be demonstrated.

I believe that those thresholds are far too high. They should be lowered so that firms can be issued with enforcement notices or fined for breaching the Act without the Information Commissioner having to demonstrate “damage or distress” or

“substantial damage or substantial distress”.

The current thresholds have resulted in a situation where it is next to impossible for the Information Commissioner to enforce penalties against these firms. A recent tribunal decision went against the Information Commissioner when a £300,000 fine was overturned despite the defendant sending hundreds of thousands of illegal text messages.

14:30

This situation cannot continue. We have to demonstrate that we are serious about stemming the flood of unwanted text messages and nuisance calls. Lowering the thresholds would send that message and allow the Information Commissioner to do his job—the job that consumers expect him to do. We need to take away the thresholds about distress to the consumer and simply tell companies, “It’s illegal to do this—let’s stop it now.”

[Mr Steve Reed (Croydon North) (Lab)]

I want to speak in favour of new clause 1 and new schedule 1, which call for independent advocacy and citizen involvement in decision making in public services. I commend my hon. Friends the Members for Walthamstow (Stella Creasy) and for Cardiff South and Penarth (Stephen Doughty) for proposing them.

I wholly welcome the extension of these rights into the public sector. It is only right that people should be able to seek redress when things go wrong or to expect their complaints about service failure to be treated seriously. It is certainly right that people should have more power to influence decisions made about them by other people. I worry that, as my hon. Friend the Member for Walthamstow said, the Bill in its current form will not allow that to happen as readily as it should.

A number of Labour councils are part of the Co-operative Council Innovation Network, of which I am very proud to be the patron. The councils involved are working together to find new ways to hand power to service users so that they have more control over the services they use and the people and organisations who provide them. That approach is already demonstrating that it can improve outcomes for citizens. One of the lessons those councils have learned is that handing people more power, on its own, is not enough. Many people who rely heavily on public services do so because they are extremely vulnerable or socially excluded. They lack the capacity or experience to exercise the power made available without additional support to allow them to do so.

Let me offer an example. Personalised budgets are a fantastic opportunity to give more control to people who rely heavily on care services such as home helps, day care, or assistance in managing chronic health conditions at home. Yet many of the people offered personalised budgets feel poorly equipped and supported properly to manage them. Research shows that this is one of the reasons why there has not been a higher take-up of personalised budgets, and that is a missed opportunity. The answer is to put in place the support that people need to exercise control. For someone not used to handling relatively large budgets, it can be a frightening experience to be asked to do so, particularly at a time when their health may be failing. Bringing budget-holders together with experienced advocates—people who are on their side and can help them to understand and articulate their real needs—can transform the situation. We need to build people’s capacity to participate in order to make this power meaningful.

Another example is children’s services. Many service users are children who have experienced severe trauma or disruption in their lives. They do not, of course, have any professional experience themselves of running things—they are, after all, children—but that does not mean they cannot take more control, as long as appropriate support is on offer. When I was elected leader of Lambeth council in 2006, the authority’s children’s services were rated by Ofsted as among the worst 3% in the country. By 2012, Ofsted rated exactly the same services as the best in the country by a considerable margin. One of the key reasons for that transformation was the active involvement of children in shaping their own services—but providing those children with support was fundamental in making that process work. That is why the new clause is so important in improving the Bill.

We also need much greater openness and transparency of information and data in public services. People cannot participate in decision making if they do not have full access to information. I was bitterly disappointed to see Croydon council, which covers the constituency I am proud to represent, failing to understand this. It took a decision to sell off the borough’s public libraries to a private developer in secret, behind closed doors. Doing it in that way fuelled public concern that the deal was not in the best interests of residents. That feeling appeared to be justified when the buyers, Laing, quickly sold the libraries on to another developer, Carillion—at a considerable profit, one would assume, but unfortunately we are not allowed to know.

These are public resources and public services, and decisions about them should be transparent and open; the public should be able to participate. At the council I led, I introduced a very simple open data charter which stated that the authority would publish everything that it was not legally prevented from publishing. Once we did that, the public started asking for data in different formats so that they could use them to scrutinise services more thoroughly and propose better ways to run services, and alternative providers to run better services. That approach helped to create community-run parks, a community-run youth services trust, more tenant-led housing estates, and even a new council website designed by the residents who were using it.

However, citizens need support to take advantage of these opportunities, or the potential for change that they offer will never be realised. We need the new clause and the new schedule if we want these powers really to work for everyone and not just for a privileged few.

[Lilian Greenwood (Nottingham South) (Lab)]

I should like to speak in favour of new clause 2, which seeks to clarify how the Bill will be implemented and how consumers will be informed of their rights.

In particular, I want to ask some questions of the Minister about the implications for rail services. It was welcome news in Committee when, in responding to a question from my hon. Friend the Member for Cardiff South and Penarth (Stephen Doughty), the Minister confirmed that the National Rail conditions of carriage will be refreshed to provide stronger provision for consumers in order to make them consistent with the rights set out in this Bill. The operators’ trade body, the Rail Delivery Group, has said:

“The Conditions of Carriage are under review. They will be published by the end of the year and will be fully compliant with the Consumer Rights Bill.”

It also said:

“They’ll be more consumer-friendly in terms of the language used”.

That will be a huge improvement from the passenger’s point of view.

I have a number of questions about how this implementation will be carried out. Do the Government intend to conduct a wider review of the passenger protections in the National Rail conditions of carriage? They could use the Bill as an opportunity to strengthen passenger rights where, for example, the train operator fails to provide passenger assistance, which is so important for disabled passengers; where someone finds that the seat reservations on their train are not being honoured; where there are planned engineering works that the operator could have known about in advance but has not informed people about; or where someone finds on arriving at the station that part of the journey they expected to be by train will be on a replacement bus service.

If the intention is to carry out this wider review of the National Rail conditions of carriage, why has Passenger Focus so far been excluded? Can the Minister guarantee that there will be no watering down of passenger protections in the National Rail conditions of carriage that may be additional to the protections provided in the Bill? All the consumer protections in the Bill are subject to parliamentary scrutiny, and the public have had an opportunity to influence them and have a view on them. Changes to the National Rail conditions of carriage are not usually subject to such public consultation, but this is an unusual circumstance. Will the Minister clarify whether the proposed revisions to the National Rail conditions of carriage to make them consistent with the Bill should be subject to public consultation?

I have a few more questions about implementation and the consequent need for further guidance, as set out in the new clause. The National Rail conditions of carriage do not apply to light rail systems such as the Docklands light railway or the London underground, where separate conditions of carriage are set out by Transport for London. Have the Government made an assessment of the various light rail conditions of carriage? Do Ministers plan to exclude them from the rights in the Bill, as with the National Rail conditions of carriage, or, indeed, to do something different about them?

There are also a number of issues concerning equivalent protections and how they will be met. At present, under the National Rail conditions of carriage, a passenger is entitled to a full refund only if they decide not to travel after the service is cancelled or delayed or when a reservation is not honoured and the ticket is unused. Passengers are entitled to partial refunds if they decide not to travel for other reasons, but they are subject to a £10 administration charge. Passengers who start their journey are entitled to compensation of only 20% of the price paid, and only if their service is more than an hour late. Although some rail operators offer a more generous delay/repay compensation scheme, that is not set out in the national rail conditions of carriage.

If passengers are entitled to a repeat performance, as set out in clause 54, on the grounds that the journey was not in accordance with the information given about the service, as outlined in clause 50, will they now be entitled to a full refund? Could that therefore be the stronger provision relating to compensation for consumers that the Minister mentioned when she responded in Committee in March?

I also want clarification on another issue. When passengers are affected by planned possession works by Network Rail, rather than the train operator, they will clearly be receiving a substandard service, but will they be entitled to compensation? I do not think they have such an entitlement at present.

Obviously, I am speaking in my capacity as a Back Bencher rather than from my position on the Front Bench. Many of our constituents are frustrated by their experiences on the railways, and they want to know that the rights set out in the Bill in relation to rail fares and services are being addressed by the Minister and that there is an opportunity to strengthen consumer protections in such an important area of policy.

[Damian Hinds (East Hampshire) (Con)]

I want to talk briefly about new clause 3 and new schedule 1, particularly because they relate to the private sector and one of the three sectors named under the Enterprise and Regulatory Reform Act 2013.

As the hon. Member for Walthamstow (Stella Creasy) has said, this country, like the rest of the world, is undergoing a revolution in data in terms of their volume, richness and accessibility, and, in some ways, their associated risks. There is also a rapidly changing market in price comparison, and the hon. Lady has referred to some of the benefits that can accrue from that. The development of that market is not entirely benign and is certainly not without cost. There are two opposing forces: consumers’ ability to compare prices and services side by side tends to bring prices down, but the nature of the marketing—the branding land grab, the cost of advertising and particularly the pay-per-click auction model on the internet—tends to drive costs and therefore prices up. It is certainly true, however, that price comparison has great potential to make markets work better. I am very proud of everything the Government are doing with midata to help make that a reality.

One market that does not work at all is one of the three mentioned in the 2013 Act: retail banking current accounts. The actual cost to consumers of having a current account is, on average, £152 a year, but nobody we talk to, including informed consumers and even Members of this House, knows that. Whenever we talk about “free” banking, we should use inverted commas, because, of course, there is no such thing as free banking. If consumers could see how much they are actually paying, both explicitly in behavioural charges and implicitly through forgone interest, the retail banking market would work better because there would be more diversity and competition.

Critically and perhaps even more importantly—this touches on some of the new clauses and amendments we will debate later—the fact that people do not know how much their banking is costing them inhibits the development of new retail banking products. Such products include budgeting bank accounts—so-called jam jar accounts—for which people have to pay a fee, but through which they are much less likely to tip into debt, because they make it easier to budget money and also that tiny bit easier to save a small amount.

New clause 3 is not necessary because progress is already being made. The powers already exist.

[Stella Creasy]

indicated dissent.

[Damian Hinds]

The hon. Lady shakes her head, but the powers already exist under the 2013 Act. The Government are looking for voluntary progress, which I think is the right way to proceed on reforming markets. A review of progress is due about now, and I hope the Government will continue to do what they are doing. They have the reserve right to push for more and have said explicitly that if not enough is being done, they will consult on the wording of regulations in order to make those markets work better compulsorily. That is the right approach, as opposed to jumping the gun.

14:45

[Tom Greatrex (Rutherglen and Hamilton West) (Lab/Co-op)]

I rise to speak in support of new clause 4, which is in my name. Unlike other Members present, I was not familiar with this Bill until recently. I did not serve on the Bill Committee. The Minister may recall that I asked her an oral question two or three months ago about issues relating to warranties and additional warranties sold by retailers. My question arose not only from a specific constituency case, but from the related concerns of a number of constituents who have contacted me over the past three or four years.

In her response, the Minister drew my attention to this Bill, which was in Committee at the time, and suggested that I should look to it for comfort, so I did. I also read the Committee’s debates on warranties. My hon. Friend the Member for East Lothian (Fiona O'Donnell) is in her place and I recall from my reading of the proceedings that she raised some issues relating to electronic goods. She mentioned her experience in the past and I think she said that the situation may have improved since then. However, I tabled new clause 4 because of an experience that demonstrates that that is certainly not true in all cases.

My hon. Friend the Member for Walthamstow (Stella Creasy) has already referred to the implementation group, which seems to be the catch-all for everything that is going to happen at some unspecified point in the future. I understand that the intention behind the group is that it will ensure that legislated rights are translated into something meaningful for consumers. It is entirely right and appropriate for the new clause to seek to ensure that the implementation group should provide, at a specific point after the Bill receives Royal Assent, guidance on some specific issues.

Constituents tell me that what they are actually sold often turns out to be very different from what they were told they were being sold, particularly on additional or supplementary guarantees and warranties. A retailer will often tell them that what they are being sold will enhance their consumer protection and enjoyment of the product and provide them with a safeguard. It then turns out, however, that there is nothing more in the warranty than that to which they are already legally entitled or what is included in the manufacturer’s own warranty.

[Yvonne Fovargue]

Does my hon. Friend agree that it is not just that the warranties are sometimes mis-sold, but that companies such as BrightHouse in the rent-to-own market make it compulsory for new customers to take out a warranty when they may already have their own household insurance on those goods?

[Tom Greatrex]

My hon. Friend makes a very important point about that specific market. I am also aware, as a result of talking to my constituents, that there is almost an expectation on people working for other retailers to sell these warranties, even if it is not obligatory for consumers to have them. In some cases, they even receive a commission for doing so.

That leads me to my concern about a specific case, in which what was written in the signed document was clear, but the way in which the warranty was described and explained to the consumer certainly was not clear and was very different. In that case, a constituent of mine bought a television set from a high street electrical store. He was told that the additional warranty he took out—on top of the manufacturer’s one—would entitle him to a new set if anything went wrong within the five-year period. His television set broke down during that period, but he found in the small print that he was only entitled to a repair or a replacement, which was exactly the same as the manufacturer’s guarantee. That meant that, on the basis of what he was told in the store, he had paid what for him was a significant amount of money every month for something that was effectively worthless.

Fundamentally, I believe that retailers have a duty to consumers not to sell them products that they know to be worthless, which appears to be the case if a warranty simply duplicates existing rights. Warranties very often apply to electronic goods that are significantly expensive, so we can see how a consumer could easily be persuaded to pay for an expensive warranty scheme that delivers no extra benefit, as the retailer is often probably very well aware. That is an area on which the implementation group should certainly undertake some work. Some provisions in the Bill—for example, clause 30—relate to warranties, but they do not seem to cover that point.

In that case, I took up the issue with both the company and my local trading standards office. The trading standards office was very sympathetic, but the long and short of it is that such practices are entirely legal, and there is nothing it can do other than to advise people to be more aware next time. That will not be much comfort for someone who has spent a significant amount of money on something that does not meet their expectations or provide the protection to which they think they are entitled. I of course understand that this problem is not new—it was raised several times in Committee as well as previously in the House—but the implementation group should be charged with ensuring that it is dealt with, and the new clause presents an opportunity for that to happen.

My new clause also addresses the management of deposits. I tabled it after a local small business approached me about an account held with a telecommunications firm— TalkTalk. As many hon. Members will be aware from their constituents, telecommunications contracts for small businesses often require quite sizeable deposits. My constituent was asked to provide a bond of some £900.

The size of such deposits has been a subject of interest for the regulator. I draw the House’s attention to the outcome of a dispute between Apple Telecom Europe Ltd and BT on the level of security deposit required for services, in which Ofcom stated that it was unwilling to determine what an appropriate deposit might be. In the light of that, it is clear that the regulator is not currently prepared to step into that space, but the size of some deposits places a clear responsibility on policy makers to ensure that the rights of the consumer or service user are protected.

After terminating the contract, two issues arose for my local business: first, TalkTalk was in no hurry to return the deposit; and, secondly, when it did return the deposit, it did so without any interest. On the first point, TalkTalk made it clear that it would hold on to the bond beyond the end of the agreed three-year contract. Effectively, it intended to hold on to the bond or deposit until my constituent ceased to be a customer, at which point the onus was on my constituent to write to TalkTalk to request the return of the money. My sense is that the responsibility in that scenario is the wrong way round. It places all the obligation on the consumer, and all the potential benefit of not meeting the obligation on the retailer. Because the retailer was not required to return a bond in a timely fashion, it is clear that my constituent missed out on substantial interest payments on the £900. Given that such contracts may well be for significant lengths of time and may then be renewed, the money amounts to a significant figure over time, particularly for small businesses; it is far from trivial.

My new clause addresses both concerns by requiring the implementation group to report on the length of time for which a retailer may retain a bond after the termination of a contract and on the payment of interest on the money. It would not be unduly burdensome for the company to be required to place bonds in a separate account, the interest on which could be returned to the consumer at the end of the contracted term. I am sure that the Minister is aware of the significant precedents for interest to be paid on money that is held. For example, solicitors are required to place moneys they hold on trust for a client in separate interest-bearing accounts, as is made clear in the professional code of ethics given in the Solicitors Regulation Authority handbook. Equivalent provisions cover other professions in which businesses hold money on trust—for example, an accountant who holds funds for a client to settle a forthcoming tax bill. Beyond such examples, it is clear that there is a substantial licence for abuse. There have recently been concerns in the energy market about moneys retained from excessive direct debit payments. One of the Minister’s colleagues in another Department described it as unacceptable, and said that something needed to be done about it, and the same case can be made in relation to my concerns.

I am conscious that the guidance and regulation arising from the work of the implementation group will not apply retrospectively, and so will not be of direct benefit to those involved in the two cases that I have outlined. However, their experience carries important lessons for all of us to bear in mind, and their cases might and probably will be repeated along the same lines. For that reason, I implore the Minister to look sympathetically at new clause 4. I hope that she will see that it is about enhancing the rights of consumers who, in many regards, have been and are being given poor advice and are not getting the service that I am sure she and all other hon. Members would expect.

The work of the implementation group will obviously be significant, given the number of times that the Minister has referred to it in Committee, and I am sure that she will mention it again this afternoon. It is important that the implementation group get on and deliver something, as the many people who have been following the progress of the Bill will expect. The new clause represents just one way in which there is a very clear path for the implementation group to follow in taking some action to benefit consumers and small businesses across the whole of the UK.

[The Parliamentary Under-Secretary of State for Business, Innovation and Skills (Jenny Willott)]

We have had quite a wide-ranging debate, which has been the case during many of the discussions on the Bill, because it covers so many issues. It is telling that the Opposition have tabled very few amendments; today, we are mainly discussing new clauses that attempt to add provisions to the Bill.

I want first to pause for a moment to reflect on the Bill, which has generally been accepted across the House as a good piece of legislation. It will benefit consumers—all consumers—and by setting out key consumer rights in one place, it will empower consumers. As we discussed several times in Committee, well-informed and confident consumers can experiment and shop around, which drives innovation, boosts competition and creates growth. The entire suite of consumer law reforms are estimated to be worth more than £4 billion to the UK economy over 10 years. Including the impact on consumers, business and the public sector, the Bill will generate £1.5 billion and the associated secondary legislation will generate more than £2.7 billion of benefit.

Some public services will attract rights and remedies under the Bill, as we discussed at length in Committee. That will be the case if there is a contract between the consumer and a public body for the provision of products that are within its scope, because the definition of a trader is wide enough to capture the activities of any Department and local or public authority. Consumers of public services provided under a contract will therefore benefit from clearer rights, clearer remedies and, ultimately, better outcomes. I think that we would probably all agree that that is a good thing.

What we are not doing—in a moment, I will explain why it is right and proper not to do it—is to change which public services are covered by consumer law. Public services that are currently subject to the Supply of Goods and Services Act 1982 and the Sale of Goods Act 1979 will be covered by the Bill. I will now turn to public services that are not covered by its provisions because such services are not provided under contract to a consumer. They include most NHS care, state-funded education and law enforcement services.

Let me be very clear: those consumers are nevertheless protected, and in a way that will often provide more tailored, specific and appropriate safeguards, designed to fit the particular service. Many of the tailored regimes already incorporate just the sort of protections that Opposition Members are pressing for—independent advocacy, regular reporting and established ombudsman schemes. In some cases, the protections already in place are similar to those provided by the Bill. For example, the rights that are consolidated in the NHS constitution are very similar to those in general consumer law, but are tailored for the provision of health care.

15:00

Where the protections are not similar, consumers benefit from even greater protection. Several sectors have well-established alternative dispute resolution services. For example, the Parliamentary and Health Service Ombudsman, the local government ombudsman and the housing ombudsman play an important role as key, respected arbiters for complaints about care, treatment or choice in public services.

The Government share the desire of the hon. Member for Walthamstow (Stella Creasy) to improve consumer input into the delivery of public services. We are committed to further improving how the public sector uses complaints and feedback to improve service provision. In October last year, my right hon. Friend the Minister for Government Policy announced two further pieces of work to do just that. The first follows his recognition that UK Governments have not made nearly enough use of complaints as a tool for identifying systemic problems. He has set up a review of how Government Departments, agencies and public services can use patterns of complaints to improve the services that they offer.

The recent Public Administration Committee report on citizens and public services raises some very interesting issues, as well as revisiting some that have been looked at before, about how complaints could be used as tools to drive change for the good. We will consider carefully whether the approach that the Committee recommends is right for consumers and the public, and will focus on what might be the practical and delivery considerations of its ideas.

Secondly, my right hon. Friend the Minister for Government Policy will take a wider look at the role and powers of the public sector ombudsmen, and consider the case for a single public sector ombudsman. The Government are grateful to the Public Administration Committee for its inquiry on that issue. That report, alongside the Committee’s recent report on complaints, will be a valuable contribution to the Government’s ongoing consideration of the ombudsman landscape and complaint handling. On both those matters, my right hon. Friend will report to the Prime Minister in the summer. The Government will respond to the Committee’s reports in due course.

We prioritise making sure that consumers know their rights. That means all consumers, whether of public or private services and whether public services are provided under contract or under a tailored regime. Consumers of public services have access to advice, information and advocacy from Government-funded channels such as Citizens Advice and gov.uk. There are other bodies, such as Age UK, that act as consumer advocates, especially for more vulnerable consumers.

The Citizens Advice remit covers benefits, housing, employment, debt and money, consumer, tax, discrimination, health care and wider individual legal problems, as well as other issues. It has a very broad remit. It is right that consumers have a central source of advice and, if necessary, can be signposted to other help, where it is needed.

[Mr Steve Reed]

Does the Minister believe that public library users in Croydon should have a right to know why the council chose to sell the libraries off to one bidder rather than another, and that it should have taken that decision publicly, rather than in private?

[Jenny Willott]

Obviously, I cannot comment on the situation in Croydon because I do not know the details. However, the Government are committed to freedom of information and, in a moment, I will talk about the access to data and information that we are supporting in the private and public sectors.

We fully recognise that sometimes more intensive support is needed, above and beyond the advice that is given by Citizens Advice. That is why the patient advice and liaison service offers confidential advice, support and information on health-related matters. There are already independent third-party adjudicators in the public sector, for example at HMRC. Those systems exist to support consumers, often the most vulnerable, in making a complaint and having their voice heard.

There is a serious danger that mandating others to provide a service that overlaps what is in place will confuse, rather than strengthen, the landscape. We need to continue to make public services more responsive to end users, not dilute the central role of Citizens Advice and hinder its ability to act as a key advice agency by creating bureaucracy. We all share the vision of public services provided to a high standard, where consumer feedback and consumer choice work to push up standards. However, we do not need to bring them all within the ambit of the Bill to achieve that.

The transparency of data in the public sector, which has been raised by hon. Members, is a priority for the Government. In many areas, transparency is much more advanced in the public sector than in the private sector. Consumers of public services have access to a wealth of data, such as crime statistics and educational standards. Those all work to empower consumers, promote choice and accountability, and, ultimately, raise standards.

Let me make it clear that the Government support the principle that the public should have access to the data that are held on them. That is in line with our open data policies and activities, and with the approach that we are taking to the negotiations on the European data protection regulations. We embrace the principle that where social benefits can be obtained from anonymised data sets—so-called “big data”—that should be supported. That is why, alongside the midata programme, which is concerned with commercially held data, we are exploring how the data that are held on individuals by Departments might be made available to those individuals in a useful way. That work is in its early stages, but it is designed to address just the sort of issues that we have been discussing today.

As the hon. Member for Walthamstow said, we have been reviewing the progress with the voluntary approach that has been taken to the midata programme so far. I plan to announce the results of the review shortly, but in the meantime I can report that there was an encouraging development in March. In the personal current accounts sector, which was raised by the hon. Member for East Hampshire (Damian Hinds), we have secured a commitment from the big banks to provide customers’ transaction records—their midata—as downloadable files with a consistent format. That has been called for by Which? and the comparison sites. It is encouraging that by the end of the year the vast majority of current account holders in the UK will have access to their midata files. I hope that that reassures the hon. Gentleman on the points that he has raised.

We are working with all the parties involved to ensure that tools are available to use those files. We are confident that this approach will help consumers to compare more easily what is on offer in terms of price and service. As was highlighted by the hon. Member for East Hampshire, there is clearly a lot more to be done to encourage consumers to switch. We hope that by providing the information and working with comparison sites, we can ensure that that happens more often.

Our central objective is that the Bill should deliver rights that are much easier for consumers to understand and use. It is a vast improvement in terms of the simplicity of the language and the consistency of approach. However, we recognise that traders need to know their forthcoming responsibilities in good time before the Bill comes into force, and consumers need practical guidance with real-life examples of how the legislation works. Achieving that quality of communication is a significant challenge and requires planning, which we have been doing.

As hon. Members have highlighted and as we discussed many times in Committee, we have been working with an implementation group to develop appropriate guidance and effective channels of communication. The group is making progress and we will publish a timetable later this year setting out when the parts of the work will be done. We intend to have guidance for businesses available soon after Royal Assent, and it will be available for consumers when the legislation comes into force to ensure that people are able to access and understand their rights.

[Tom Greatrex]

Will the Minister confirm whether the implementation group is looking at the specific issues that I raised: the retention of bonds and interest payments for small businesses, and additional warranties that are sold by retailers that do not provide any additional benefit to the consumer?

[Jenny Willott]

If the hon. Gentleman will bear with me, I will come to those matters later in my speech and address the points that he raised.

[Fiona O’Donnell (East Lothian) (Lab)]

With an increasing number of consumers shopping online, will online traders have any duties under the Bill to provide information about consumers’ rights?

[Jenny Willott]

I am sorry; could the hon. Lady repeat the question?

[Fiona O’Donnell]

I am happy to repeat the question—it might even be better this time. Will the Minister say whether, with an increasing number of people shopping online, there will be a duty on online traders to provide consumer rights information to their consumers?

[Jenny Willott]

I apologise to the hon. Lady. That was a very sensible question. That is being looked at. As she says, more and more people are buying online, so this is an important outlook for retailers. We need to ensure that consumers are aware of their rights, whether they are buying things on the high street or online. As we discussed in Committee, some requirements are being introduced in June that will provide more information and safeguards for consumers who purchase items online. The implementation group is looking at all the ways in which consumers buy goods and services to ensure that they are protected and know what their rights are.

The hon. Member for Nottingham South (Lilian Greenwood) asked a number of questions about rail conditions of carriage, but such questions would be much more properly put to the Department for Transport. If I may, I will direct her points to Ministers in that Department and ask them to write to her with details of how the conditions of carriage are being reviewed. That is not a matter for the Bill but it is being considered by the Department for Transport, and I will ensure that her points are raised.

[Lilian Greenwood]

In Committee the Minister said that although rail services are excluded from the Bill, it was intended that any rights introduced by the Bill be incorporated in the rail conditions of carriage to ensure that consumers were no worse off as a result of that exclusion. How will she ensure that that is implemented?

[Jenny Willott]

I understand that rail conditions of carriage are more detailed and already go further than the fundamental backstop rights in the Bill. However, the Department for Transport is reviewing them, and I will ensure that her questions are passed to Ministers so that she receives a more detailed answer. We will ensure that the Bill is not confused with the rail conditions of carriage, and that they take primacy.

The hon. Member for Rutherglen and Hamilton West (Tom Greatrex) raised an important constituency case, and I understand why he wished to do that. It concerned a business that had to pay a deposit for a telecoms contract, but the Bill does not affect business-to-business rights; it is about consumer rights and affects consumer-to-business rather than business-to-business contracts. I cannot comment specifically on the case, but it would probably not be covered by the Bill since it is a business case. Generally, however, we are doing more to protect deposits that are paid under contract.

Under the Bill, if a consumer enters into a contract for services and pays a deposit but then cancels, the trader does not have a free hand to retain that deposit. Any term in a contract that allows a trader to retain a deposit must be transparent and prominent to avoid challenge in the courts on grounds of fairness. Where such terms do not also provide equivalent compensation for the consumer when the trader dissolves the contract, they are liable to be challenged as unfair, even if they are transparent and prominent.

Our reforms also include clearer cancellation rights in consumer contracts regulations for consumers who buy at a distance or at home. Consumers must be informed that they have 14 days to change their mind and cancel such contracts, and a trader must reimburse them within 14 days of being informed by the consumer about a cancellation of the services. Those regulations will come into force in June, which will give consumers additional protection.

[Fiona O’Donnell]

The Minister is generous in giving way again. Is she not missing the point that my hon. Friend the Member for Rutherglen and Hamilton West (Tom Greatrex) made, which was that the Government missed an opportunity to protect small businesses in the Bill, to treat them as consumers and give them those rights? That £900 can be the difference between a business sinking or swimming.

[Jenny Willott]

As the hon. Lady will remember, we discussed this issue at length in Committee. The Government consulted on whether small businesses should be covered by consumer legislation in 2008 and 2012, and on both occasions the result of that consultation was that they should not be. Recent work by the Federation of Small Businesses considered whether micro-businesses should be covered by consumer law, and it too came to the conclusion that they should not be. There is work to be done on the protection of micro-businesses, and some regulators are considering treating them in a similar way. However, the Government consultation on consumer law resolved that it was far more complicated to include micro-businesses as consumers, and that was not the response to the consultation.

The hon. Member for Rutherglen and Hamilton West raised the issue of guarantees being sold with products. Consumer protection regulations already prohibit traders from presenting statutory rights as a distinctive feature of their offer, so a guarantee that offered no more than a consumer’s statutory rights would already be prohibited. We have now made it easier for consumers to get their money back when they have been mis-sold something to which they already have a legal right.

15:15

Extended warrantees can offer consumers valuable additional benefits if done properly, such as accidental damage cover, regular servicing and so on. Before consumers buy extended warrantees in the shop at the same time as buying electrical goods, they must be informed of their statutory rights and their right to cancel the extended warranty. In 2012 the Office of Fair Trading found recent significant improvements in the market, and although we recognise that there have been issues in the past, more and more consumers are now shopping around when looking at warranties. That is driving competition between warranty providers, which seems to be increasing quality and lowering price.

[Yvonne Fovargue]

Will the Minister elaborate on how that would affect customers of organisations such as BrightHouse and PerfectHome, where the cost of an extended warranty is included in the price of the goods and is compulsory? What rights do those customers have to cancel and get some money back, apart from giving back the goods?

[Jenny Willott]

The issue is whether extended warrantees provide anything over and above the statutory rights provided under the law. If companies charge more just to provide statutory protection, that would be prohibited under consumer protection regulations. A purchase that somebody would make, such as a hire purchase or whatever, would depend on the terms of their contract. If the contract contains terms that are unfair, they may well be on the grey list—we will come to that in future discussions on the Bill—and such terms may be challengeable in the courts on grounds of fairness. If the hon. Lady is concerned about specific terms in the Bill, she might raise them at that specific point in our debate to see whether they would be covered.

[Tom Greatrex]

I am grateful to the Minister for giving way again but I raised another point, to which she did not respond. It concerns what happens if a consumer buys a product with a manufacturer’s warranty and is then sold a supplementary warranty by a retailer, which does nothing more than the manufacturer’s warranty. Is that an issue on which the implementation group will be able to provide information for consumers?

[Jenny Willott]

That is the point I just made. If a warranty provides no more than the statutory rights and there is a charge associated with it, whoever is selling the warranty may well be in breach of consumer protection regulations. When shops sell goods and the warranty is purchased at the same time, the full cost must be disclosed and consumers must be informed of their statutory rights. Consumers also have the right to cancel the extended warranty within a set period, and those rights must be made known to the consumers when they purchase the warranty. That is covered under consumer protection regulations, and there are also rights in this Bill. The circumstances that the hon. Gentleman highlights would be covered.

The other issue raised today is nuisance calls, which is a priority for the Government. I am sure that all hon. Members have had constituency casework on that, but there is no silver bullet to eradicate the problem. That is why in our action plan of 30 March we set out a range of measures to address the issue. They included work that is already under way to improve call tracing, making it easier to disclose information between Ofcom and the Information Commissioner’s Office, and setting up a taskforce led by Which? to review consumer consent issues. We will also consult on making it easier for the Information Commissioner’s Office to tackle nuisance calls as part of amending the Privacy and Electronic Communications (EC Directive) Regulations 2003. Although I understand the intention behind the new clause, the Government are taking a lot of action in this area. Changes will be introduced in the next months, and we are consulting on more actions. I hope that I have covered the issues raised by hon. Members, and I therefore ask the hon. Member for Walthamstow to withdraw her new clause.

[Stella Creasy]

The Minister expressed surprise that some of these issues should have been the subject of new clauses. I am sad about that. In her responses, she is missing some of the debates that we had in Committee on just these issues—not just on implementation but on the impact of the Bill on the public sector. I am saddened that she has not answered what I call the Graham Norton question about the licence fee. We will take that as a yes, meaning that licence fee payers will be entitled to these rights.

The Minister said that a review of complaints is ongoing and talked about the role of the public sector ombudsman. This is what is causing so much concern and has prompted the new clauses. That is happening at the same time as this legislation is making progress, so a whole series of new legal methods of redress will be open to licence fee payers, personal care budget holders and students paying tuition fees. At the same time, a secondary process is being undertaken in government. The situation is confusing.

I am pleased that the Minister’s understanding of consumer rights in the public sector—and what they can offer—is evolving. In that sense, I am happy to give her the benefit of the doubt in what she says about new clause 2 and the implementation group. I am sure that the Lords will want to hear about its further progress. I am also happy to give her the benefit of the doubt about advocacy. Her conversion to the importance of advocacy is welcome: it was not clear in Committee, but it is wonderful to hear her talking about it now. She has been dragged kicking and screaming to the debate, and I refer to the comments made by my hon. Friends the Members for Croydon North (Mr Reed), for Makerfield (Yvonne Fovargue) and for Rutherglen and Hamilton West (Tom Greatrex), and even the hon. Member for East Hampshire (Damian Hinds) about the importance of advocacy and what more should be done in the Bill.

On that basis, I am happy not to press new clause 5 to a vote, but I will press new clause 3 and new schedule 1, given what the Minister said about information. I have to point out to the hon. Member for East Hampshire that the Government have admitted that the midata project has stalled. The look on his face spoke volumes about the problems of getting access to those data. The Minister said that the Government thought that people should have access to the data they create within the public sector: the Opposition think that people should own their own data. It is a clear dividing line.

New clause 3 and new schedule 1 set out some clear rights for people. On nuisance calls, the Minister said the Government are already doing something. Why does she oppose paragraph 5 of new schedule 1, which would place sanctions on those people who do not have consent, to send a clear message to the companies that are abusing the information that they have? It is beyond me. The issue of ownership of data is key, so we will press new clause 3, which would bring in new schedule 1, to a vote. The British public should not just have access to their data; they should own it. It is a clear division between the two parties on consumer and citizen rights, and an increasingly important debate for this country. I beg to ask leave to withdraw the motion.

Clause, by leave, withdrawn.

New Clause 3

Access to data

‘Schedule [Access to data] has effect.’.—(Stella Creasy.)

Brought up, and read the First time.

Question put, That the clause be read a Second time.

15:22

Division 275

Ayes: 218

---

Labour: 204
Scottish National Party: 5
Plaid Cymru: 3
Democratic Unionist Party: 2
Social Democratic & Labour Party: 1
Independent: 1
Alliance: 1
Green Party: 1

Noes: 287

---

Conservative: 245
Liberal Democrat: 42

New Clause 6

Payday lenders levy

‘The Secretary of State shall produce an annual report on the level at which a levy on lenders in the high cost consumer credit market should be set and bring forward measures to ensure—

(a) provision of free debt advice for vulnerable consumers; and

(b) provision of affordable alternative credit through credit unions.’.—(Stella Creasy.)

Brought up, and read the First time.

[Stella Creasy]

I beg to move, That the clause be read a Second time.

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

With this it will be convenient to discuss the following:

New clause 7—Debt management plan regulation—

‘The Financial Conduct Authority shall bring forward recommendations within a year of the commencement of this Act regarding the practice of directly charging consumers fees or charges for the provision of debt management plans, including recommendations on the phasing out of such practices.’.

New clause 9—Credit broker fees—

‘(1) The Consumer Credit Act 1974 is amended as follows.

(2) In section 160A (Credit intermediaries) after subsection (4) insert—

“(4A) Persons engaged in credit intermediary activity under this section or credit broking activity under section 145 shall not charge or take any fee from a debtor in respect of these activities until such time as an introduction results in the debtor entering into a relevant agreement.”.’.

New clause 11—Practices of rent to own companies—

‘(1) This section applies to credit agreements and consumer hire agreements taken out in respect of household goods specified in rules by the Financial Conduct Authority.

(2) The rules under subsection (1) shall—

(a) include a requirement on lenders to include in pre-contractual information adequate explanations and information allowing prospective customers to compare both the cash price of goods and the total cost of the credit agreement to a representative retail price for those goods;

(b) prohibit lenders from requiring customers to take out insurance sold or brokered by the lender as a condition of obtaining credit;

(c) set out specific steps lenders must take before taking action to enforce the agreement or recover possession of goods; and

(d) set out the steps lenders should take to check that the agreement is affordable and suitable for prospective consumers.’.

New clause 23—Consumer credit: bill of sale—

‘(1) Where a person is a purchaser of goods subject to a bill of sale, made in connection with a regulated agreement under the Consumer Credit Act 1974, in good faith and without notice of the bill of sale, title to those goods shall pass to that person.

(2) A creditor is not entitled to enforce a bill of sale made in connection with a regulated agreement by recovering possession of the goods except through an order of the court.

(3) If goods are recovered by the creditor in contravention to subsection (2)—

(a) the bill of sale will be treated as invalidly made; and

(b) the debtor shall be released from any outstanding liability under the regulated agreement.

(4) If the creditor has disposed of goods taken in contravention of subsection (2) the debtor shall be compensated to the value of those goods.’.

[Stella Creasy]

The new clauses lie at the heart of consumer issues: if consumers have no money in their pockets, they will not do very much consuming. A personal debt crisis is brewing because millions of people are trying to make ends meet and pay for the debt they took on to try to make ends meet previously. Household debt is at its highest since 2009, with people owing £1.6 trillion in personal debt. Some 43% of us say that we often or sometimes struggle to make it to payday—little wonder, given the way in which the cost of living has escalated. The new clauses come into play because debt repayment is increasingly the reason that people struggle to make it to payday. They reflect an attempt not to continue the good work that has been done in this House to address the consumer credit market, but to recognise that the Government’s belated conversion to the Opposition’s approach on payday lending needs to be just the start of the conversation on how we ensure that people have the pounds in the pocket they need. This is intrinsic to our economic future, given that consumer spending has accounted for so much of the growth we are now seeing. That, in itself, is perhaps one of the problems we face.

Let me explain the new clauses I wish to speak to today, because I know that other Members want to speak to the new clauses they propose. New clause 6 concerns what Members might call my bête noir—payday lenders. There are now 8 million loans annually, which are worth £2.2 billion. Those loans come with a cost. The National Audit Office estimates that they cost consumers £450 million a year of direct consumer harm, because of the failure to regulate the payday lending industry. For several years we proposed regulation of the industry, but it will come in only next year.

One in 10 British adults are likely to take out a payday loan in the next six months. That figure is going up, not down. It is little wonder that companies such as Wonga are making £1 million a week from our constituents—a 36% increase on the previous year—even though it is writing off huge swathes of its loan book. Some 40% of those who took out a payday loan said that it made their financial position worse, but many feel that they have little alternative. Credit unions are desperately trying to fill the gap, but it is an impossible gap to fill with the current level of need. It is time for payday lenders to pay their way. New clause 6 would enable an additional levy to be made on high cost credit companies to ensure that they provide funding for the debt advice and extension of credit unions that this situation requires. In fact, we believe the pressure on debt advice agencies and, indeed, credit unions is likely to increase, not subside, in the years ahead. We therefore think it time for the payday lenders to pay for the damage they have done.

New clause 7 also speaks to the growing personal debt bubble in our society, and to the conduct of the cowboy debt management agencies. We have already talked about legal loan sharks, and now it is time to look at the cowboys, but these are not just the stuff of nightmare. These companies are profiting from the misery of our constituents, exploiting the way in which debt management is done in this country.

The Government themselves admit that in excess of 1 million consumers each year are seeking advice on how best to deal with their financial difficulties. Many of us will know from our constituency surgeries the people who come to us in desperate need, often because they are about to be evicted for falling behind with their rent. We also encounter people who are struggling financially and who need help forming a debt management plan to deal with their creditors. That is the gap that these companies have filled.

About 7% of British adults report struggling to payday due to debt management payment plans, and 6% blame their payday loan problems on debt repayments. Bank loan repayments are the cause of 13% of those who struggle to payday. People are struggling because they are trying to pay back the debts they have accrued, especially over the last couple of years. It equates to about 2.5 million people that we know of who are already in a debt management plan.

Some debt management plans are available free, and I pay tribute to organisations such as Christians Against Poverty and StepChange for the work they are doing in providing people with free debt advice. After all, it is the most perverse of experiences for people struggling with financial debt to be charged to get out of the hole they are in. That is the challenge we are facing. It was estimated in 2010 that commercial debt management companies were making about £250 million a year from over-indebted clients. As I say, that was back in 2010. The Money Advice Service now tells us that there are 9 million people in our country who are over-indebted, so these are the people for whom these sorts of services may well be apposite. The need to reform how they work therefore becomes even stronger.

Ministers admitted in 2002 in response to questioning by the BIS Committee that there was evidence of some abuse of upfront fees, so let us talk about what is meant by that. We have an example from Clear View Finance of a gentleman for whom 90% of the money he was paying to the company was being taken in a fee, so a mere 10% of the money he was paying to clear his debts was going to his creditors—little chance for him to get out of the cycle of debt he was in any time soon! Yet when the Minister admitted that there was such abuse, he said that these companies had a role to play, so there was not really any need for any further regulation of them. We disagree, and we were disappointed when the Government voted in Committee against our proposals to deal with debt management companies.

We recognise that the Financial Conduct Authority has taken over the management of these companies, and it proudly trumpets that it is going to limit to 50% the amount a company can take in fees rather than pay out to creditors. We believe that we should go much further. We do not believe that people should be charged for being in debt when they come forward for help, and we want to see the phasing out of fees for debt management altogether.

Let me provide an example of why that would make a difference. StepChange, which provides this service for free, found that a client with a typical debt of £30,000 would have to pay for a commercial product almost an extra £6,000 in fees—£6,000 over and above the loan repayments. That extended the plan by approximately 18 months in comparison with one that StepChange had put together.

Taken in concert with new clause 6, which would provide the funding to increase debt advice, we believe that we can phase out fees for debt management, and we believe that that is the right thing to do—not to charge people for getting into debt, but to help them get out of debt. As millions of Britons are already in this cycle and millions more are likely to get into it as interest rates rise and they have increasing problems with their credit card and personal debt repayments coming home to roost, the case for reforming our debt management cowboy firms grows all the stronger.

Finally, new clause 23 speaks to another legal loan sharking practice in this country, which we believe is long overdue for overhauling. Citizens Advice chief executive Gillian Guy has said:

“The logbook industry is still in the dark ages and has been getting away with lawless practices. It is absolutely absurd that a firm should be able to take away someone’s possessions without any due legal process.”

Millions of people are affected, both those who take out logbook loans and those who buy a second-hand car without knowing that there is a charge against it, only to find that the car is being repossessed and that they have no recourse to any legal practice.

15:45

The Financial Conduct Authority itself found that some 40,000 consumers had taken out logbook loans in 2013, typically borrowing about £1,000 a time—again, at astronomical interest rates—although lenders were offering loans of up to £50,000 a time on their cars. That was done by means of a bill of sale agreement, an agreement that harks back to the Victorian era and contains no modern consumer protection measures. It is estimated that one in four second-hand cars in this country is sold with an outstanding charge against it as a result of a bill of sale agreement. That means that the company that provides the loan retains ownership of the car, and can therefore repossess it. Even if the new owner is unaware of the loan, if it has not been paid off he will have to forfeit the car.

This is possible only because we allow bill of sale agreements to continue, which is why I am so disappointed that, in Committee, the Minister led her side to vote against our proposals to abolish the present arrangements. We believe that the whole House should look at the matter again. We believe that the case for removing the ability of bill of sale agreements to be abused in this way is overwhelming. The Minister said that there might well be a case for updating the legislation, but that she did not believe that that was a matter for the Bill. Earlier, she had said that she did not believe that the Bill applied to the public sector. She has performed a welcome U-turn, so let us hope that she will also take account of her own words, uttered in 2007. She said then that we needed to crack down on the illegal and unethical practices of some banks, credit card companies and loan companies. If there was ever an example of an unethical practice, it is the way in which such companies use bill of sale agreements. Is it not time to finish the job and end these agreements? New clause 23 would enable us to do that.

I pay tribute to my hon. Friend the Member for Makerfield (Yvonne Fovargue) for all the amendments she has tabled, and for the work she is doing in the industry. She has been trying to clean up the consumer credit market and end the damage that it is doing to many of our constituents. Government Members may laugh at the idea that the cost-of-living crisis is affecting people in our communities, but we see at first hand the way in which consumer credit companies are making a mockery of the idea that we have adequate consumer protection in our country. We believe that the new clauses would go some way towards continuing the conversation.

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

I intervene on the hon. Lady because I want to put it on record that no Government Members are laughing about anyone who happens to be in debt. Many of us, along with Opposition Members, have worked very hard to deal with issues relating to personal debt, and we are not laughing at all.

[Stella Creasy]

I am delighted to hear that the hon. Gentleman takes the issue seriously. I assume that he will support the new clauses, which constitute a recognition of the need to act now. [Interruption.] The hon. Gentleman talks of 13 years, but the growth of the payday lending and logbook loan industries has exploded as people have found that there is too much month at the end of their money. That has been a fact for the last couple of years. The question for all of us now is this: do we sit and argue about these issues, or do we take action? The Bill gives us an opportunity to take action with some very concrete proposals to end fees for debt management companies, to make the payday lenders pay their way, and to deal with the problem of logbook loans.

Let me simply say this to Government Members. They can either put their money where their mouths are and recognise that these problems need to be dealt with, or they can carp and make political points. It is their call, but I know what my constituents would rather see: support for the new clauses.

[Justin Tomlinson (North Swindon) (Con)]

I have a huge amount of admiration for the hon. Member for Makerfield (Yvonne Fovargue), who tabled new clause 11, and who brings plenty of front-line experience to the House. She has taken a cross-party, constructive and positive approach on a number of issues, and has a good, strong record of influencing the Government’s opinions.

The new clause is, in effect, the BrightHouse clause, and I was moved to come and speak about it because I had seen the company’s recent television advertisements displaying the cost of renting washing machines, televisions and even the sofas on which people could sit while using the other articles they were renting.

There are two parts to the proposals that I urge the Government to seriously consider. The first concerns displaying the total cost, because often the weekly or monthly repayments seem relatively reasonable but once we translate them over the entire period of the loan, we start to realise they can be a very expensive way to purchase an item. The work I have done on the all-party group on financial education for young people was centred on empowering consumers to make informed decisions, and that should also be a priority in respect of consumer credit regulations. It is all about making sure consumers can make an informed decision, and when the facts are displayed in cash terms even those with limited financial ability are able to make a relatively informed decision.

The point about protecting consumers by making sure they can afford the products is also important. We are moving towards that in the high-cost lending market. It is what we do with bank loans, for instance, and I do not think it is unreasonable to have it in this context, because this is in effect a loan, as until the person has completed the purchase—until they have paid 100% of those monthly or weekly costs—the item is not theirs. If they fall over at the 99% stage, it is returned. It is therefore in effect a loan that gives the person something at the end, so there should be protection because all too often consumers who have no chance of completing 100% of the payments are getting themselves into an expensive way of accessing items. There is merit in those two particular areas and I hope the Government will give them serious consideration.

[Yvonne Fovargue]

I am chair of the all-party group on debt and personal finance and we have done constructive work on many of these issues. I support the new clauses and I am pleased that new clause 23 addresses the Victorian practice of bills of sale. They are used for a purpose for which they were never intended. That does not just affect those who take out a loan by using them; it also affects people who do everything they can to check hire purchase information and the credit agreement on the car in question but who do not know their car can still be taken at any time.

I want to speak to my new clause 9, which deals with the problem of credit broking firms. I believe they are the new wild west in this area. They offer, for a fee, to find consumers a loan. In too many cases they take the fees from the consumer and do not give them a service at all, or they find them an unsuitable loan that they do not want. Under some circumstances consumers can get a partial refund, but they often struggle to get these firms to give the refund.

There was a super-complaint by Citizens Advice in 2011 and the Office of Fair Trading concluded:

“At the first available opportunity, the Government should carry out an impact assessment to establish whether legislative change would effectively address the consumer detriment caused by upfront fees in the credit brokerage sector both in the immediate and longer term, including considering a ban on credit brokers charging upfront fees”.

The Government declined to do this, saying that the new OFT guidance issued in response to the super-complaint should be given time to work. It has had two years to work and I am still getting evidence of problems.

I would like to mention a recent constituency case that caused me to look into the practice of one particular company, Myloan. The 18-year-old daughter of a constituent tried to get a loan; unbeknown to her mother and father, she was desperate. She went to Myloan in January. She completed the process and was advised that it could not loan to her, but she had given it her bank account details because it said it would find her a loan. It took the 16-digit number, the security number and an application fee of £68.99. It then processed the application. It sent her details off to 13 other companies. No companies offered her a loan, yet every company took an application fee, and she ended up a further £375 in debt. The majority of that money was taken within nine days of the initial approach. She was 18 and she did not know what would happen if she did this. It is clear that she was taken advantage of by this company.

I looked into this company and there were pages and pages of complaints on the internet of it taking fees and people not getting loans. We need to act now to stop vulnerable consumers being cheated by these companies.

I now wish to deal with the BrightHouse clause, which was mentioned by the hon. Member for North Swindon (Justin Tomlinson). It deals with companies that offer household goods to customers on a rent-to-own basis, whereby, again, they make weekly payments and own the product only once the final payment is made. I am using BrightHouse as an example because it is the largest rent-to-own company in the United Kingdom. It has more than 270 stores and plans to expand at a rate of about one a fortnight. These stores have become a common feature on the high street and tend to be found in more deprived areas. Indeed, it has been remarked that having a BrightHouse store is now a signifier that the area could be deprived, not that BrightHouse’s stores are downbeat or shabby—they look really good.

A TV researcher contacted me about BrightHouse because she had gone into one of its stores to look for a bedside cabinet and was appalled by the amount BrightHouse was charging a week. People who are unable to pay outright for goods and may previously have gone to get a social fund loan now cannot get one and have to use these weekly repayments. They allow customers to pay in small weekly chunks, repayable over several years. That can be convenient but there is a catch or two—if we include the insurance that is included, there is a catch or three. BrightHouse defends adding everything together by saying, “Our target customers are mostly women and they like things simple.” Well this is one woman who does not agree with BrightHouse on that one. Not only do its customers pay a higher price—often higher than is paid in Harrods—but at a typical APR of 69.9% the loan is extortionate. For example, customers can buy an HP Envy 120 all-in-one printer from BrightHouse for £322.23, which will end up costing £520 by the time they have paid £5 a week over 104 weeks, whereas John Lewis has the same product for £149.99.

[Justin Tomlinson]

Obviously, I support the principles being expressed here. The key thing is that the vast majority of consumers would not be able to calculate the total cost with an APR—even Treasury Ministers would struggle to do that—which is why it is so incredibly important to have everything displayed in cash terms. That is the simplest form for any consumer, allowing them to make an informed decision.

[Yvonne Fovargue]

I totally agree with that. I do not believe many customers know how over the odds the costs are. They cannot use a comparison, because they do not have the £150 to go to John Lewis to pay the cost straight off. They think that they are paying a bit more, but they are paying a fortune more—they are paying nearly five times as much. My new clause would require stores to set out all the costs, and I make provision in respect of similar goods because BrightHouse has occasionally changed one figure or a letter at the end and said, “There isn’t a comparable good.” There is a comparable good, but BrightHouse has just changed an X or a Y at the end of the goods.

Customers may still choose to shop at BrightHouse —I would not stop them shopping there—but they need to have the full facts. Clearly, low weekly payments are what make BrightHouse seem attractive to so many, but that does not mean they are affordable. BrightHouse encourages its customers to take on more and more loans; I have had reports of people being rung at home with tempting news of the latest in-store arrivals, keeping the customers in a constant cycle of debt. Small weekly payments quickly mount up and become unaffordable. There is talk about people buying the big TVs, but the other problem is that that is the only option in BrightHouse. It does not have the smaller goods; it has the big plasma TVs. BrightHouse does not stock the range of goods that people can shop around for.

I have encountered a case of a customer making weekly payments of £75 to BrightHouse, from a benefits payment of £100 a week—it is no wonder people cannot survive in such circumstances. My new clause would ensure that BrightHouse has to carry out proper affordability checks. We are asking payday lenders to do that, so why should the rent-to-own companies not have to do it as well? Including the insurance does not provide value for money, but people will not challenge it under the unfair contract terms because, in general, the people who go to BrightHouse do not want to challenge and go to court, as it is a frightening experience. So my new clause will ensure that these companies cannot enforce taking out the cover.

The last part of my new clause deals with repossession, because a lot of evidence shows that a missed payment or two leads to the loss of the goods concerned, often without a court order, despite the fact that the customer has paid the true cost of the goods several times over. BrightHouse says that that is done only with the customer’s consent, but many people have been left in dire straits when essential items such as their fridge or washing machine have been taken, often at short notice. The company has a perfect right to take the goods, but there are ways of doing it fairly. My amendment ensures that proper procedures are followed, and that customers are not pressurised into giving back goods for which they have paid a considerable amount. I am not against the services that BrightHouse offers, but I am against a business model that is so stacked against the customer that it amounts to little less than exploitation. There is a huge irony when the poorest in society pay the highest prices. BrightHouse and others like it should give thought to their customers and their ability to pay. Hopefully, this amendment will concentrate their thinking.

16:00

[Damian Hinds]

It is always a pleasure and an honour to follow the hon. Member for Makerfield (Yvonne Fovargue) who talks not only with passion but with a great deal of knowledge and expertise about these matters. I wish to speak briefly about new clauses 11 and 6. Before I do, may I say that it was a little unfortunate that the remarks of the hon. Member for Walthamstow (Stella Creasy) took the turn that they did at the end? What she said is simply not true, and everybody in this House who takes an interest in these issues, which she certainly does, knows that the sub-prime high-cost credit market has been around for donkey’s years. It has not started—[Interruption.] No, it has not started, or even in its totality dramatically shifted, in the past three years.

The hon. Lady mentioned statistics for payday lending and logbook lending, but, if she was being complete in her analysis, she might have talked about when the big growth spurt came in home credit. She might even have talked about when the growth spurt came in rent to own. Perhaps she would like to take the opportunity to talk briefly about those things now. I would happily take an intervention.

[Stella Creasy]

Will the hon. Gentleman clarify whether he voted three times in the House over the past three years against capping the cost of credit and therefore tackling some of these problems? If he recognises that there are problems, is he saying that he will support the new clauses today?

[Damian Hinds]

Clearly, I was not saying that. I was asking the hon. Lady whether she wanted to comment on the growth of home credit and rent to own. We have had many opportunities in this House to discuss a cap on the cost of credit, and she and I—and she and many other Members—have had an opportunity to discuss some of the practical aspects. There will now be a cap on the total cost of credit, but that is not to say that the definition of that is without difficulties. It remains a tricky thing to do. All of us, including her, who take a close interest in these issues know that there is no single silver bullet solution that solves any of these market problems. We need regulation, empowerment for consumers, financial education and sensible alternatives. This House is at its best when we are discussing what those practical approaches might be, and I welcome the new clauses, which allow us to talk about those very things. I have an awful lot of sympathy for the sentiment behind new clause 11, which was put forward by the hon. Member for Makerfield, and for what is behind new clauses 7 and 9, but we must be wary about seemingly straightforward legislative solutions that may not deliver all they purport to.

We always talk in the plural when we refer to rent-to-own companies, but in reality there is one really big company. There is a problem with the pricing and marketing of these companies. I have recently been added to the BrightHouse e-mail marketing list. I do not know what I have done to deserve that honour—I am not sure whether I should take it as a compliment—but I am now bombarded with messages saying how easy it is to pay weekly, and it is those messages that go to the heart of the problem. To be fair, the slightly misleading approach that we are talking about does not necessarily apply just to rent-to-own companies. We could say that it applies to every pay-monthly mobile phone contract, through which we not only pay for our calls but finance the phone, but it is never advertised how much is for the phone and how much for the calls. We always see it as one all-together monthly amount.

[Mrs Anne Main (St Albans) (Con)]

My hon. Friend is making very measured comments. It is true that no one party has a handle on debt in this debate. Many of us are concerned about the matter. Does he agree that companies such as Emmaus in my constituency have helped to ensure that people do not have to take on ridiculous payback terms, by enabling them to access good refurbished second-hand goods free of charge if their circumstances allow? I pay tribute to companies such as Emmaus that have helped many people in difficulty who need goods.

[Damian Hinds]

I am not familiar with Emmaus, but I am sure that it is an admirable organisation. I can mention Furniture Helpline in my constituency, and there are many others throughout the country.

[Mr Mike Weir (Angus) (SNP)]

I am listening carefully to what the hon. Gentleman is saying. Affordability is at the root of this issue. It is not only companies such as BrightHouse that concern us—for years, when interest rates were rising, supposedly reputable companies simply extended the time that people had to pay, so that the weekly payments stayed relatively low. That is the real issue at the heart of this.

[Damian Hinds]

The hon. Gentleman is absolutely right. [Interruption.] My hon. Friend the Member for St Albans (Mrs Main), who is sitting next to me, mentions catalogues: catalogue credit has worked on that basis for a long time, stressing the weekly repayment amount. There is also an ability to shift the amount that is apparently the cost of the product and how much is paid for the financing—in the case of catalogues, that is often zero, but the base price is inflated to allow for that.

My worry about the approach in the new clause tabled by the hon. Member for Makerfield is that I do not know how we would make the price comparator work. She made an important point about product numbers. As electronic comparison capability increases, it will be important to be able to make a direct like-for-like comparison, and adding an extra letter to a product number to make such comparison impossible should certainly be cracked down on.

[Mrs Main]

My hon. Friend is absolutely right. Many of the goods that are advertised are often own-label brands, and that makes it very hard for consumers to make a direct like-for-like comparison with another branded good.

[Damian Hinds]

It is difficult, but if we are talking about a big plasma TV or a washing machine, equivalent products and other brands are also available. The basic problem, however, is not that the information is not available, because the idea that people do not have the ability to make such comparisons becomes less and less true every month, with smartphones and so on. The difficulty relates to money advice, and encouraging and prompting people to make the comparison. We do not solve that problem by adding small-print text about the total cost, the annual percentage rate, the total cost of credit, the reminder that “your house may be at risk”, blah, blah, blah. All those things do not solve the problem of how we encourage people to make that comparison and do the analysis to ensure that they are not worse off than they need to be.

That leads me on to new clause 6 and the so-called

“annual report on the level at which a levy on lenders in the high cost consumer credit market should be set”.

There is a levy that applies to lenders, so I assume that the requirement for a report is a device to call for something that might be in place anyway. Debt advice is also provided. We could argue that, at the high-cost end of sub-prime, such lenders should make a greater contribution, because of the detriment associated with them, but that does not require primary legislation.

The new clause would also have the Government make provision for affordable credit to be available through credit unions. I would argue strongly that the Government have brought and are bringing forward measures to ensure that affordable credit is available to vulnerable customers through credit unions. Through the credit union expansion project, tens of millions of pounds are being made available to modernise and upgrade the sector. Through regulatory reform—the passing, finally, of the legislative reform order—the increase in the monthly interest rate cap from 2% to 3% makes competition with high-cost, short-term lenders a little more possible. Also, as we were discussing, the cap on the interest charged in the commercial sector will at least help to slow the apparently inexorable rise of that sector. There are also things that the social lending sector must do. It has to step up to the plate on its marketing, branding and consistency of product offer. There will have to be consolidation in the sector to provide the services that people want.

I do not know whether the idea behind new clause 6 in the mind of the hon. Member for Walthamstow came from the recent IPPR report, on which she commented, which suggested that a one-off levy on high-cost lenders would facilitate a great expansion in the social lending sector.

[Mrs Main]

Will my hon. Friend speak a little more slowly? The hon. Member for Walthamstow (Stella Creasy), on the Opposition Front Bench, is having trouble tweeting. She is trying to provide a running commentary on his speech and perhaps if he went a little more slowly she would catch up.

[Damian Hinds]

I will always follow the hon. Member for Walthamstow, so I shall pay great attention to what she has tweeted after the debate.

I have a lot of sympathy with any measures proposed to help support the growth of the credit union sector. A lot of things in the IPPR report are welcome and positive, such as the idea of having credit unions in post offices, Church of England facilities and so on, but with respect to all concerned I would say that those are hardly first-time-out occurrences of the proposals. A back-stop reclaim facility, through the benefit system, could also have some benefits.

However, the idea—this is the main point—that some huge one-off capitalisation of credit unions would help to facilitate their growth, is not right. Under the previous Government, we had the growth fund, and I am not here to diss that. It was a well-intentioned initiative and will have done a lot of good. Such things are also eroded over time, however, and by definition if one has a big one-off capitalisation one ends up having to address a slightly more costly part of the market, which contributes to that erosion. What we need to do to help support and facilitate the growth of credit unions is what this Government are doing. We are trying to get them on to a sustainable footing with modernised systems, working collaboratively together to get the marketing and branding right so that the sector does not need a subsidy for ever but reaches a scale at which it can address more and more consumers, meaning that fewer and fewer consumers need or want to access the types of lenders we have been discussing today.

[Fiona O'Donnell]

Despite appearances, my hon. Friend the Member for Walthamstow (Stella Creasy) and I are not taking part in a mother and daughter catalogue photo shoot later. We should perhaps co-ordinate in future on what to wear when we are both taking part in the same debate.

It is a pleasure to follow the hon. Member for East Hampshire (Damian Hinds). He said that his Government are taking an interest in issues around payday lending. They are certainly taking something, although I am not sure whether it is just an interest. When he criticises Labour, saying that for 13 years we did nothing, he fails to recognise that there has been an incredible growth, certainly in my constituency, in the number of people having to resort to payday lenders. They are having to increase the amount they are borrowing from those lenders as well as their general debt levels. There is a cost of living crisis and poverty is the root cause, and the Government should have acted more quickly. The hon. Gentleman is on the record as having said that self-regulation works, but even he has had to admit that self-regulation of payday lending has not worked and that it is time for action.

Figures reported by StepChange last December showed that among its clients, people seeking debt advice in East Lothian, my constituency, are now saddled with average payday loan debts of £1,864, £466 above the Scottish average.

[Justin Tomlinson]

I want to reassure the hon. Lady that a number of us have worked on a cross-party basis to push for the extra regulation the Government are introducing. At no point were we saying that self-management would be fine. We were pushing for regulation and I am delighted that the Government are taking that forward to protect vulnerable consumers.

[Fiona O'Donnell]

I wonder whether I can ask the hon. Gentleman which door he pushed. Was it in the Aye Lobby or the No Lobby when we voted on this issue? Taking an interest is what we do in this House, but it is the action we take that matters. I am not aware of his having rebelled but perhaps I am misjudging him. I will gladly give way to him again on that point.

[Justin Tomlinson]

I am afraid that the hon. Lady is confusing two issues. A huge amount of work has been done by the hon. Member for Makerfield (Yvonne Fovargue), the hon. Member for Sheffield Central (Paul Blomfield) and Members from all three parties. They have come together to influence Government regulation that has been introduced to protect vulnerable consumers. The hon. Lady is simply confusing two issues.

16:15

[Fiona O'Donnell]

The two issues I am confusing are what people say and what people do.

I want to be helpful to the hon. Member for East Hampshire on the e-mails that he is receiving from BrightHouse. I suggest that he follow up the matter with the Financial Conduct Authority. The last time we debated high-cost loans, I spoke about my experience with Wonga. I had received an e-mail offering me another loan when I was not aware that I had ever had a loan. I was told that the e-mail had not come from Wonga, that it was some kind of fraud and not to worry about it. I have recently taken this up with the FCA, which now has some authority to deal with the issue. I think that the authority will be asking the Government for more powers to get to grips with this. It suggested to me that a fraudulent application for a loan had been made in my name; my contact details were supplied, but Wonga failed to notify me of that and has retained my data on its files, and that is why it has been marketing products to me. He may wish to take up his case with the FCA and perhaps check out his credit rating—as I immediately did, to see whether the application had affected me. I admire his restraint in not rushing from the Chamber at this very moment to do that.

The exploitation that we have seen is plain and simple. Payday loan companies are not called legal loan sharks for no reason. They are predatory. They sniff out hunger, home in on and exploit the difficult situations in which so many of our constituents find themselves. The figures from one of my citizens advice bureaux in Haddington showed that debt-related cases accounted for 51% of its total inquiries from April to June 2013, a rise in East Lothian of more than 40% from the same quarter the previous year. That is why Opposition Members have been urging the Government to do something as quickly as possible. It is why we are saying that the cap needs to be introduced. It is welcome that the Government have changed their mind, but we would like to see that brought forward to 2014. People in my constituency and all our constituencies who are struggling with debt need help now.

While not everyone who borrows using a payday loan gets into difficulties, enough do as a result of the terms of the loan that the industry is now making billions of pounds. When one in three such loans are being used to pay off another payday loan, we need to call time on these lenders breaking their own codes of conduct and step in to reform the industry. It is time to have a levy on the industry so that companies have to give something back to the communities who are swelling their coffers but suffering at the same time. The hon. Member for East Hampshire said that the money suddenly injected into credit unions would not have the impact that we hoped. My constituency is served by a credit union, but it does not have a presence on the high street; it lacks visibility. It works through employers such as East Lothian council encouraging their employees to save with them, but it does not reach the people who wander off the high street into The Cash Store or BrightHouse. A cash injection to the credit union in my constituency to give it a high street presence would tackle the exploitation that I see among the poorest and most vulnerable people.

I understand that Members have worked on a cross-party basis—I will now try to take back some of the earlier sour remarks—but let us not be limited in our ambition today. I hope that they will get behind the new clause and make a difference to the people who are suffering in our constituencies.

[Sir Edward Leigh (Gainsborough) (Con)]

This is a useful debate. The trouble with the new clause is that, unless we are careful, if we legislate in haste on complex legal matters, we may be subject to the law of unintended consequences and make things worse. No one denies that a lot of people are under tremendous financial stress, and we all want more transparency. I agree that on many occasions the law needs to be updated.

The hon. Member for Walthamstow (Stella Creasy) talked about bills of sale and described them as a Victorian product. In fact, bills of sale have been around for centuries. The Bills of Sale Act dates from 1878, and was amended in 1882. That does not necessarily mean that bills of sale are wrong in themselves. I looked up the definition of “bill of sale”, which is

“a legal document made by the seller to a purchaser…that on a specific date at a specific locality and for a particular sum of money or other value received, the seller sold to the purchaser a specific item of personal property, or parcel of real property, of which he had lawful possession.”

It is a written instrument which evidences the transfer of title to personal property from the vendor or seller to the vendee or sellee. For instance, a typical bill of sale would be something very simple: “for the sum of X pounds I hereby sell to Larry Smith full ownership of a green John Deere harvester.”

A bill of sale is a simple, historic or traditional way of ensuring the transfer of title. I agree with the hon. Member for Walthamstow that things can become complicated, and that is evidenced in legal sources when a bill of sale is attached to a loan, as it can be used as evidence of a loan and security for a loan; so someone’s car, for instance, may be used as security for a loan.

Just because some bills of sale are misused and some people suffer as a result of the process or are under legal stress, that does not mean that we have to throw a century of careful legal practice and growth out of the window, as we might make things worse. If we over-regulate legal loan providers, we may well force people into the clutches of unregulated loan sharks. My suggestion to the Minister—and I agree that this is a serious problem—is that rather than attack bills of sale, which have been around for a long time and have been used in an entirely reputable and correct way and entirely transparently to transfer ownership, or just throw them out of the window by accepting a new clause that has not been thought through, the issue should go to the Law Commission, which can study all the evidence and practice and ensure that we protect consumers, achieve full transparency, and modernise the law. We should not rush through Acts of Parliament that can make things worse for people under stress and force them into the hands of loan sharks.

[Jenny Willott]

I welcome you, Mr Deputy Speaker, to our exciting debate this afternoon. The hon. Member for Walthamstow (Stella Creasy) opened the debate by saying that we had an opportunity to take action on these issues. I completely agree, so I am sure she is absolutely delighted to see how much the Government have done to protect consumers and take action in these areas.

We have debated a number of issues, and I shall run through them in turn. First, on the issue of high-cost or payday lenders, hon. Members will know—certainly the hon. Lady knows this, as we have discussed it before—that the Government have taken robust action to curb the harm these lenders can cause. On 1 April, responsibility for regulating payday lenders, along with all other consumer credit firms, transferred from the Office of Fair Trading to the Financial Conduct Authority, as mentioned by a number of Members. The Government strongly welcome the FCA’s new, tough rules for regulating payday lending. The FCA requires robust affordability checks, limits the number of times that a payday loan can be rolled over to two, and places tough restrictions on lenders’ use of continuous payment authorities. As highlighted by a number of Members, the Government have also legislated to require the FCA to introduce a cap on the cost of payday loans to protect consumers from unfair costs. The FCA will consult on its proposals for the cap in the summer, and it will be in force no later than 2 January 2015.

In addition, the FCA will thoroughly assess every payday lender’s fitness to trade as part of the authorisation process. Given the risks to consumers, the FCA has said that those firms will be in the first phase of firms and will be required to be fully authorised from October this year. The Government believe that the tough and decisive action the FCA is taking, including the cap on the cost of payday loans, will ensure that consumers are far better protected than they have been.

[Justin Tomlinson]

The welcome news is that the measures are already making a difference, because a number of lenders have already withdrawn from the market, which is a bonus for the vulnerable consumer.

[Jenny Willott]

The hon. Gentleman is absolutely correct. We only have anecdotal evidence at the moment, but it is clear that a significant number of lenders have already withdrawn from the market because they know they will not be able to comply with the rules, which are extremely tough. As he said, that is absolutely as it should be. People who cannot comply with the rules are withdrawing, and consumers are being protected as a result.

Free debt advice is currently funded by a levy on lenders channelled via the Money Advice Service. As payday lenders are now regulated by the FCA, they too will contribute to the levy. The new clause tabled by the hon. Member for Walthamstow would duplicate the existing funding arrangements for debt advice. It is important that we put on the record the fact that payday lenders will be contributing to money advice services via the levy.

It is also important to note that the FCA is taking steps to ensure that vulnerable consumers are aware of the free debt advice available to them. It requires all high-cost, short-term lenders to signpost their customers to free debt advice at the point at which a loan is rolled over, and all payday lending adverts must include a risk warning and information about where to get free debt advice.

[Yvonne Fovargue]

Will the Minister confirm that the amount raised by the levy will increase as the payday lenders are brought into it and that the amount paid will remain the same and will not simply be spread more thinly among the lenders?

[Jenny Willott]

To be totally honest, I do not know the answer to that question, but I will write to the hon. Lady to clarify that point.

Similarly, the levy will duplicate the Government’s existing support for credit unions. The Government are already investing £38 million to support the sustainable growth of credit unions to help them meet borrowers’ needs, as highlighted by the hon. Member for East Hampshire (Damian Hinds). Through that expansion, credit unions could save people on low incomes up to £1 billion in interest repayments, compared with going to a payday lender.

The Government therefore firmly believe that consumer choice and protection will be substantially strengthened by the new FCA regime and the ongoing Government support for credit unions. For the first time, payday lenders and other consumer credit firms will start paying their fair share towards funding free debt advice through the Money Advice Service, so the Government are already dealing with many of the issues that have been raised today.

Turning to debt management companies, the Government share the concerns about the potential for detriment to occur to consumers who take out debt management plans. There has been increasing media attention and people are becoming increasingly aware of the problems affecting some consumers. I also recognise the importance of protecting that particularly vulnerable group of consumers. The Government’s focus is on comprehensively reforming regulation in this sector. Responsibility for regulating debt management firms, as with all other consumer credit firms, has been transferred from the OFT to the FCA. As with customers of payday lenders, those participating in debt management plans will be far better protected under the new FCA regime.

The FCA has stated publicly that debt management firms must start putting consumers first and that it is unacceptable that people who are struggling to make ends meet are being talked into unsuitable plans. The Government have made sure that the FCA has robust powers to protect consumers who use debt management firms. The FCA is proactively monitoring the market and has a broad range of enforcement tools that it can use to punish breaches of the rules. There is no limit on the fines it can levy. Crucially, it can force firms to pay redress to consumers. The FCA will thoroughly assess every debt management firm’s fitness to trade as part of the authorisation process—the same process that applies to payday lenders.

Given the risk to consumers, the FCA has said that debt management firms will be in the first phase of credit firms that are required to be fully authorised. Its rules make it clear that the fees charged for debt management plans should not undermine the customer’s ability to make significant repayments to their lenders throughout the duration of the debt management plan. Concerns have been raised, including by the hon. Member for Walthamstow, about the huge proportion of somebody’s payment that, in some cases, goes to the debt management firm rather than the creditors. That is a matter of significant concern.

16:30

As a result, the FCA set out in its guidance that debt management firms should not allocate more than half the money received from customers in debt management plans to meeting the fees and charges from month 1 of the plan, and that once the initial fee for the arrangement of the plan has been paid, the proportion should reduce. Because the practice of front-loading fees can make debt problems worse before they get better, the FCA’s policy is designed to ensure that significant repayments must always go towards outstanding debts with creditors right from the very start of the debt management plan, so that progress is being made in paying off the debts. The FCA will be actively scrutinising the market, and it has flexible rule-making powers so that it can take action if it finds that consumers are suffering due to poor services or products. Like payday lenders, debt management firms are required to signpost customers towards free, independent debt advice. The FCA has put in place binding prudential rules for debt management firms that hold over £1 million of client money to help to protect customers if things go wrong. The Government believe that the new FCA regime will help to deliver a diverse and reputable debt management market that is able to meet a range of consumers’ needs when they are struggling with debts.

Although, as I have said, I am deeply concerned about some of the evidence we have seen of consumer detriment caused by some of the fee-charging providers of debt management plans, I do not think we should unduly restrict consumers’ choice of debt management plan providers and products. As several hon. Members have said, there are some excellent providers of free advice run by charities. I have some in my constituency, and I am sure that we find them across the whole country. Fee-charging debt management plan providers who are operating with consumers’ interests at heart and in full compliance with the regulations can help to provide a wider range of solutions and products for consumers. Some consumers may prefer to use fee-charging providers in dealing with their debts. Removing such providers from the market would reduce the options for and availability of debt management solutions for consumers who find themselves in financial difficulties, and that is not something the Government want to do.

The issue of credit brokers has been raised. Brokers who comply with the rules can play a role in a sustainable consumer credit market in helping consumers to access credit by connecting them with lenders. To be fair, brokers incur costs whether or not a consumer enters into a credit agreement with them. Prohibiting firms from charging fees could therefore push them towards a commission-driven business model, potentially creating conflicts of interest and leading to a less transparent fee structure that would be worse for consumers. The FCA rules require credit brokers to disclose their status and any fees that are payable before the consumer enters into the brokerage contract. The FCA has made it clear that disclosure must also cover the consumer’s right to a refund if no credit agreement is entered into within six months following an introduction. That relates to the case raised by the hon. Member for Makerfield (Yvonne Fovargue). The FCA has made a range of other conduct rules that apply to credit brokers. Brokers are required to comply with the high-level principle, which is general across the FCA credit services rules, of treating customers fairly. As I have said, it has a broad range of enforcement tools it can use, including fines and forcing firms to pay redress.

On new clause 11, let me be clear that the Government completely share Members’ concern about the risk of consumer detriment in the consumer credit market. There is clear evidence that there may be problems. The rules that were put in place by the FCA from 1 April this year were made with the stated aims of ensuring that firms lend only to borrowers who can afford it, and increasing borrowers’ awareness of the costs and risks of borrowing unaffordably and of ways to get help if they have financial difficulties.

[Mrs Main]

Does the Minister think there is any merit in making people aware, potentially at school age, of exactly what they can afford and how they can manage their personal finances? People often get themselves into a mess before they approach some of these loan sharks and high-interest places. It might be good if we started this off at an earlier age.

[Jenny Willott]

The hon. Lady makes an extremely important point. There are some really good schemes in schools across the country, but provision can be a bit patchy. I have worked in schools in my constituency that are doing exactly that. Such matters can be extremely complex for people to understand, and learning about them as part of the school curriculum before they get into debt can be extremely helpful.

[Justin Tomlinson]

I reassure the Minister that, as of September, that will be in the national curriculum, so all is under control.

[Jenny Willott]

I am very grateful to the hon. Gentleman for highlighting that.

[Damian Hinds]

To complete the set, may I use this opportunity to mention the important work done by credit unions that operate junior savers clubs in schools in the constituencies of many hon. Members? It would be great to have them in many more schools in many more places, so that young people get into a savings habit before they reach the first point at which they might take on consumer credit.

[Jenny Willott]

Perhaps the hon. Gentleman would like to speak to the hon. Member for North Swindon (Justin Tomlinson) about that. He raises a very important point: the more we can help young people to understand some of these complex financial systems and how to manage money, hopefully, fewer people will end up in debt—particularly unaffordable debt—in the future.

Returning to the FCA rules on hire-purchase contracts for household goods and what has been called the “BrightHouse clause,” the FCA’s new rules will require firms to provide pre-contractual explanations and information in line with European requirements. I hope that answers the point made by a number of Members on both sides of the House. The information will include the cash price of the goods being financed and the total amount payable. The FCA rules will require that information to be provided to consumers before they sign up. I hope that will ensure greater transparency for customers.

The rules also mean that firms have to adhere to debt-collection rules—a point raised by the hon. Member for Makerfield—including treating customers who are in default or arrears with forbearance and due consideration. They also require firms to assess credit worthiness and affordability, including the potential to impact adversely on the consumer’s financial situation and their ability to make repayments as they fall due. There are, therefore, broad requirements on firms to try to tackle some of the hon. Lady’s concerns about consumer detriment.

When firms sell associated insurance products, they must do so in line with the FCA’s requirements for assessing a consumer’s eligibility to claim on a product and the high-level principle of treating customers fairly. Those are new requirements to ensure that we try to tackle consumer detriment. The Government believe that the tough and decisive action taken by the FCA will ensure that customers are better protected as a result.

Finally, we discussed the issue of logbook loans at some length in Committee and I completely understand the concern about the potential for consumer detriment as a result of these products. The Government believe that people should be free to borrow and have the tools to make an informed decision about which credit product is right for them, but consumers should be confident that they will be treated fairly and that the regulator will step in when things go wrong.

As the hon. Member for Walthamstow will be aware, logbook lenders now also fall under the responsibility of the FCA. As I have said with regard to other credit firms, I believe that consumers will be far better protected under the FCA regime than they have been in the past. The FCA has been very clear that logbook lenders are among the firms that it considers pose the greatest risk to consumers, and they will be in the first phase of firms that have to be fully authorised from October. Logbook loans are defined by the FCA as higher risk activities and, as such, lenders face closer supervision and higher regulatory costs.

Logbook loan providers are now also required to meet the standards the FCA expects of lenders in making thorough affordability checks and providing the adequate pre-contractual explanations to consumers. They are also subject to the high-level principle of treating customers fairly. Indeed, the FCA considers this area to be a particular concern. It has said that it is

“putting logbook lenders on notice”,

and that its new rules give it

“the power to tackle any firm found not putting customers’ interests first.”

It is therefore taking its new responsibilities very seriously.

In addition to the FCA’s robust action, Treasury Ministers have asked the Law Commission to look at how best to reform the Bills of Sale Act—as we know, the legislation underpinning logbook loans is old, lengthy and incredibly complex—and, as the hon. Member for Gainsborough (Sir Edward Leigh) highlighted, the Government believe that the Law Commission is best placed to undertake a thorough assessment of how we can bring the legislation up to date. It has responded favourably to the Treasury request, and it will confirm its upcoming work programme soon.

The hon. Member for Walthamstow raised concerns about people buying cars with outstanding loans against them and about the impact on customers. She said that a large proportion of second-hand cars are sold with pre-existing charges. The Bill, like the existing law, is clear that there is a legal obligation on the seller to notify the buyer of any outstanding charges. The Bill covers business-to-consumer sales, and sales between individual consumers have the same level of protection under the Sale of Goods Act 1979, which provides that the seller must have the right to sell the goods. That applies to all contracts for the sale of goods, so it covers private sales, in addition to purchases of goods from a shop or a business. Goods must be free from any undisclosed charge or encumbrance, which applies to hire-purchase terms for goods sold on, as well as to logbook loans. The private seller is in breach of contract if they do not have the right to sell, or if there are undisclosed charges on the goods, which means that the buyer can get their money back from the private seller.

The Government are concerned about the impact of unscrupulous traders in all these areas. That is why we have taken so much action and given such strong powers to the Financial Conduct Authority, and I do not believe that the Opposition’s new clauses are the right way forward. The Government’s approach is the right one for protecting consumers, particularly the most vulnerable, and I hope the hon. Member for Walthamstow will withdraw new clause 6.

[Stella Creasy]

We have had an interesting debate. I acknowledge that there is interest in this issue, as well as experience and expertise, on both sides of the House, which has been reflected in most of the speeches. I pay particular tribute to my hon. Friend the Member for Makerfield (Yvonne Fovargue) who, for all of us, is a touchstone on issues involving the consumer credit market.

I put on the record my support for the work of the hon. Member for East Hampshire (Damian Hinds) on the credit union movement. However, I must say that I brook no argument from him when Government Members have had three chances—not one, not two, but three chances, or an almost biblical opportunity—to deal with payday lending and the cost of credit, but voted against it.

In 140 characters, the hon. Member for St Albans (Mrs Main), like Shelley’s grandmother, shed much heat but not a lot of light on what Government Members will do about the issues that are to come. Our new clauses are about the new forms of legal loan sharking and the new nightmares experienced by many of our constituents. The hon. Lady is making a tapping noise. Is that her calculating the amount of money people have to pay out to the debt management and logbook loan companies?

[Mrs Main]

The hon. Lady is doing herself a disservice. We are not point scoring. Many Government Members have concerns about debt. The tapping noise I was making refers to the fact that she seems unable to listen to comments from Government Members, and just tweets her own self-promotion endlessly.

[Stella Creasy]

The hon. Lady may be horrified about letting the public know what she and Government Members have been saying, but we are not. Government Members may be confident in their commitment to the idea that they are somehow tackling the cost of living, but when it comes to opportunities to make progress on such things as logbook loans or debt management fees, they have nothing to say and they should rightly be held to account not just in the House, but online. She would do well to reflect on such matters.

I want to move on to what hon. Members have mentioned in the debate, but may I tell my hon. Friend the Member for East Lothian (Fiona O’Donnell) that I consider us to be master and apprentice in our dress today? She pointed out that the Government seem to have a problem with the doors when it comes to voting the right way on consumer credit matters.

Let me pay tribute to the Minister and the members of the Sharkstoppers campaign. To hear a Minister in this Government talking about the action that they will take on payday lending is a tribute to the work of all those campaigners across the country. I want to give her the benefit of the doubt when she says that this Government want to make payday lenders pay their fair share. She was extremely honest about the fact that she has no idea how much money payday lenders will contribute to the cost of providing debt advice. We want to return to the issue in the Lords once we get that information, but we are happy to wait for the Minister to come back with the sums, to show that payday lenders are paying their fair share. We are pleased that the Financial Conduct Authority is looking at the outrageous practice of charging people in debt with debt management fees, and we will wait to see what the Government bring forward, and consider these issues again in the Lords in terms of whether fees should be abolished outright.

16:45

I say to the hon. Member for Gainsborough (Sir Edward Leigh) that there are many traditions worth defending: free speech, the last night of the proms, complaining about the weather—all great British traditions. However, being ripped off is not one of them, and it is time we called time on the rip-off that is a logbook loan and the way that bill of sale agreements are being used. Indeed, from what the Government say, they agree. Why leave our constituents lingering any longer under these outrageous and outmoded forms of contract? We want to push new clause 23 to a vote and say goodbye to bill of sale agreements and the exploitation of our constituents. We hear fine words from Government Members about how they want action on consumer credit, so let us see some action for a change—join us.

I beg to ask leave to withdraw new clause 6.

Clause, by leave, withdrawn.

New Clause 23

Consumer credit: bill of sale

‘(1) Where a person is a purchaser of goods subject to a bill of sale, made in connection with a regulated agreement under the Consumer Credit Act 1974, in good faith and without notice of the bill of sale, title to those goods shall pass to that person.

(2) A creditor is not entitled to enforce a bill of sale made in connection with a regulated agreement by recovering possession of the goods except through an order of the court.

(3) If goods are recovered by the creditor in contravention to subsection (2)—

(a) the bill of sale will be treated as invalidly made; and

(b) the debtor shall be released from any outstanding liability under the regulated agreement.

(4) If the creditor has disposed of goods taken in contravention of subsection (2) the debtor shall be compensated to the value of those goods.’.—(Stella Creasy.)

Brought up, and read the First time.

Question put, That the clause be read a Second time.

16:46

Division 276

Ayes: 221

---

Labour: 209
Scottish National Party: 4
Plaid Cymru: 3
Social Democratic & Labour Party: 1
Independent: 1
Alliance: 1
Green Party: 1
Democratic Unionist Party: 1

Noes: 293

---

Conservative: 249
Liberal Democrat: 44

New Clause 8

Right to supply tickets to events of national significance

‘(1) The Secretary of State may by order made by statutory instrument designate an event to be of national significance.

(2) Where an event has been so designated under subsection (1) the Secretary of State may grant permission for the organising body to impose additional terms and conditions on the sale of tickets for the event, including—

(a) the power to specify persons to act as official traders authorised to sell tickets for the event;

(b) the power to withdraw tickets advertised by a person who is not authorised as an official trader; and

(c) the power to recall unsold tickets from official traders.

(3) Where an event has been so designated under subsection (1) it shall be an offence for any person other than an official trader to sell tickets for the event—

(a) in a public place or in the course of a business; and

(b) otherwise than in accordance with written authorisation from the organising body.

(4) For the purposes of this section—

“ticket” means anything which is or purports to be a ticket for the designated event;

“selling” includes a reference to—

(a) offering to sell a ticket;

(b) exposing a ticket for sale;

(c) advertising that a ticket is available for purchase; and

(d) giving, or offering to give, a ticket to a person who pays or agrees to pay for some other goods or services.

“organising body” means a person specified by the Secretary of State as responsible for organising of the event.

(5) A person shall (without prejudice to the generality of subsection (3)(a)) be treated as acting in the course of a business if he does anything as a result of which he makes a profit or aims to make a profit.

(6) A person does not commit an offence under subsection (3) by advertising that a ticket is available for purchase if—

(a) the sale of the ticket if purchased would be in the course of a business only by reason of subsection (5); and

(b) the person does not know, and could not reasonably be expected to discover, that subsection (5) would apply to the sale.

(7) A person does not commit an offence under subsection (3) (whether actual or inchoate) only by virtue of making facilities available in connection with electronic communication or the storage of electronic data.

(8) Where a person who provides services for electronic communication or for the storage of electronic data discovers that they are being used in connection with the commission of an offence under subsection (3), the defence in subsection (7) does not apply in respect of continued provision of the services after the shortest time reasonably required to withdraw them.

(9) A person guilty of an offence under subsection (3) shall be liable on summary conviction to a fine not exceeding level 5 on the standard scale.

(10) Section 32(2)(b) of the Police and Criminal Evidence Act 1984 (c. 60) (power to search premises) shall, in its application to the offence under subsection (3) above, permit the searching of a vehicle which a constable reasonably thinks was used in connection with the offence.

(11) Subsection (13) applies where a person in Scotland is arrested in connection with the commission of an offence under subsection (3).

(12) For the purposes of recovering evidence relating to the offence, a constable in Scotland may without warrant enter and search—

(a) premises in which the person was when arrested or immediately before he was arrested; and

(b) a vehicle which the constable reasonably believes is being used or was used in connection with the offence.

(13) Subsection (12) is without prejudice to any power of entry or search which is otherwise exercisable by a constable in Scotland.

(14) A statutory instrument containing an order under subsection (1) is not to be made unless a draft of the instrument has been laid before, and approved by a resolution of, each House of Parliament.’.—(Stella Creasy.)

Brought up, and read the First time.

[Stella Creasy]

I beg to move, That the clause be read a Second time.

[Mr Deputy Speaker]

With this it will be convenient to discuss the following:

New clause 12—Right to full refund: ticketed events—

‘An event organiser must issue a full cash refund where their tickets are returned to them up to 24 hours before the start of the event.’.

New clause 13—Goods to be as described: meat products—

‘(1) All products containing halal and kosher meat shall be labelled as such at the point of sale by retail and food outlets.

(2) A food outlet is anywhere where food is served to the public.’.

New clause 14—Communications services: change of service provider—

‘(1) Section 3 of the Communications Act 2003 is amended as follows.

(2) At the end of subsection (2)(b) insert “with a switching process that is led by the receiving communications service provider”.’.

New clause 15—Right to corrective action—

‘(1) This section applies if either—

(a) the responsible economic actor has identified that goods supplied present a health and safety risk to the consumer; or

(b) the appropriate authority has identified that goods supplied present a risk to the public safety; and

as a result, the product is subject to corrective action by either party (a “recall action”).

(2) The consumer has the right to expect that the responsible economic actor for any goods supplied subject to a recall action must take all reasonable steps to inform all persons affected, or likely to be affected by the safety risks from the goods, within the shortest period of time practicable.

(3) The consumer, if placed at risk by goods subject to a recall action, has the right to prompt and effective action by the economic actor of that product to ensure that—

(a) the defect posing a safety risk to any persons affected or likely to be affected is eliminated;

(b) the actions required to achieve (a) do not cause significant inconvenience to the consumer; and

(c) all costs associated with the recall action are borne by the responsible economic actor.

(4) The Secretary of State will periodically gather and make publicly available information relating to safety incidents caused by recalled goods, and estimates of how many such goods still remain unaccounted for.

(5) The effectiveness of recall actions, and the procedures in place to achieve successful recalls, will be the subject of periodic review by the Secretary of State, with reference to public information on recalls in subsection (4) and any other relevant data.

(6) The Secretary of State may create or designate a body to act as a consumer product safety and recall authority.

(7) The Secretary of State may by regulations provide for the authority to—

(a) act to protect the public from identifiable and unreasonable risks of injury, death or household risk from consumer products;

(b) review products, test products, or receive or commission reports from other competent persons;

(c) direct corrective action to be taken by relevant economic actors, regulators or authorities;

(d) ensure and direct forms of consumer registration, from purchase of products, with databases which will be conducive to optimal fulfilment of (a) and (c) above;

(e) require notification by economic actors, including manufacturers, brand suppliers or traders, of significant evidence of concern in respect of the consumer safety of relevant products; and

(f) provide for accessible, intelligible information and advice to be available to consumers and relevant economic actors in respect of product safety, corrective actions and other guidances relevant to the authority’s work.

(8) For the purposes of subsections (4), (5), (6) and (7), the Secretary of State must consult with—

(a) market regulators;

(b) relevant authorities; and

(c) any other bodies he thinks appropriate.

(9) For the purposes of this section “economic actor” means—

(a) a “trader” as defined in section 2(2); or

(b) a manufacturer of “goods” as defined in section 2(8).’.

This new clause would enable new provision to be made regarding recall actions where a level of consumer safety risk has been identified. It would allow the Secretary of State to review and add to arrangements for corrective action for the protection of consumer safety.

New clause 16—Secondary ticketing platforms: product and seller information—

‘(1) The Secretary of State shall issue guidance to all traders who operate as secondary ticketing platforms on the application of the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013.

(2) Guidance issued under section (1) shall include how secondary ticketing platforms must inform consumers of—

(a) the chosen identity of the seller;

(b) the country of residence of the seller;

(c) information provided by previous buyers on the reliability of the seller and the tickets he has sold;

(d) information on any complaints made against the seller for failing to supply tickets;

(e) information on any complaints made against the seller for supplying fraudulent or invalidated tickets; and

(f) information on all other accounts currently or previously held with the secondary ticketing platform linked to the seller by virtue of personal, financial and contact information provided by them.

(3) Guidance issued under section (1) shall set out how information required under Part 2 of the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 shall be—

(a) accurate; and

(b) prominently displayed before a buyer is able to purchase.

(4) Guidance issued under section (1) shall set out how secondary ticketing platforms must disclose clearly if the seller of the ticket is—

(a) the secondary ticketing platform themselves;

(b) individuals employed by the secondary ticketing platform;

(c) other companies linked to employees, directors or shareholders of the secondary ticketing platform;

(d) the event organiser or an agent acting on their behalf; or

(e) any other party connected to the event organiser of the event.

(5) Guidance issued under section (1) shall set out the status of tickets as unique goods with distinct characteristics which would affect—

(a) the enjoyment of the good by the consumer;

(b) the use of the good by the consumer; or

(c) the inherent value of the good in questions.

(6) Where a ticket is sold through a secondary ticketing platform, guidance issued under section (1) shall set out how the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 apply to tickets as unique goods, including—

(a) how sellers must provide all relevant information about the ticket including but not limited to the face value of the ticket and a designated seat or ticket number;

(b) how secondary ticketing platforms will publish all the information about a ticket provided by the seller in a prominent and clear way; and

(c) what sanctions will apply for failing to provide this information under the regulations.’.

New clause 17—Secondary ticketing platforms: fraudulent tickets—

‘(1) Where a secondary ticketing platform becomes aware that sellers using their service have acquired tickets through illegal methods, or are selling fraudulent tickets, they have a duty to report this to the relevant law enforcement agency immediately.

(2) A secondary ticketing platform must meet any lawful requests for information on sellers made by law enforcement agencies or courts.

(3) Where a law enforcement agency has notified a secondary ticketing platform that a ticket advertised through their service is, or is suspected to be, fraudulent, the secondary ticketing platform must remove that ticket and suspend the seller’s activities immediately.’.

New clause 18—Secondary ticketing platforms: seller profiles—

‘(1) Secondary ticketing platforms must provide a profile of information on sellers using their service.

(2) Profile information provided under subsection (1) must include, but is not limited to—

(a) the name of the seller;

(b) the country of residence of the seller;

(c) if the seller is a company or business, its registered number, if any;

(d) if the seller is a company or business, its registered office or address for service;

(e) a list of all current and past inventory sold or offered for sale by the seller;

(f) information on all other accounts currently or previously held with the secondary ticketing platform linked to the seller by virtue of personal, financial and contact information provided by him;

(g) information provided by previous buyers of the reliability of the seller and the tickets he has sold;

(h) information on any complaints made against the seller for failing to supply tickets, and the resolution of those complaints;

(i) the VAT registration number of the seller, if applicable; and

(j) information on any complaints made against the seller for supplying fraudulent or invalidated tickets, and the resolution of those complaints.

(3) Information provided under subsection (1) must be—

(a) accurate; and

(b) prominently displayed before a buyer is able to complete their purchase.

(4) Secondary ticketing platforms must disclose clearly and prominently where the seller of the ticket is—

(a) the secondary ticketing platform themselves;

(b) individuals employed by the secondary ticketing platform;

(c) other companies linked to employees, directors or shareholders of the secondary ticketing platform;

(d) the event organiser or an agent acting on their behalf; or

(e) any other party connected to the organisation of the event.

(5) Where a seller offers for sale more than 20 tickets to the same event, the secondary ticketing platform must take reasonable steps to verify the validity of the tickets.’.

New clause 19—Secondary ticketing platforms: ticket information—

‘(1) Where a ticket is sold through a secondary ticketing platform—

(a) the seller must provide all relevant information about the ticket; and

(b) the secondary ticketing platform must publish all the information about a ticket provided by the seller in a prominent and clear way.

(2) Information to be requested by the secondary ticketing platform and provided by the seller for the purposes of subsection (1) should include, but is not limited to—

(a) the face value of the ticket;

(b) any age or other restrictions on the user of the ticket; and

(c) the designated block, row, seat or ticket number, where applicable.

(3) Where tickets are being resold in contravention of the terms and conditions agreed to by the original purchaser, this must be stated prominently by the secondary ticketing platform at every stage of the purchasing process.

(4) Information provided by virtue of this section must be—

(a) accurate; and

(b) prominently displayed before a buyer is able to complete their purchase.’.

New clause 20—Secondary ticketing platforms: compensation—

‘(1) Secondary ticketing platforms must reimburse reasonable costs to a buyer where a ticket sold through their service is fraudulent or invalidated.

(2) For the purposes of subsection (1), reasonable costs must include, but are not limited to—

(a) the price paid for the ticket by the buyer, inclusive of all service and delivery charges;

(b) all travel expenses incurred by the buyer in travelling from their place of residence to the location of the event for which they had purchased the ticket; and

(c) any accommodation expenses incurred by the buyer for the sole purpose of attending the event for which they had purchased the ticket.

(3) For the purposes of subsection (1), reasonable costs should be defined as a total amount not exceeding twice the total purchase price of the ticket or tickets in question, including all additional fees and taxes paid.

(4) Claims made by a buyer against a secondary ticketing platform under this section must be proven by receipts or other documentary proof.

(5) The secondary ticketing platform must settle any claims under this section within 40 working days, other than where a suspected fraud or abuse related to the transaction in question is the subject of an ongoing investigation by the relevant statutory authority.

(6) Secondary ticketing platforms are permitted to take all necessary action to recover any monies paid out to consumers under this section from the seller of the ticket.’.

New clause 21—Secondary ticketing platforms: definitions—

‘(1) A “secondary ticketing platform” means a person or company operating an internet-based facility for the resale of tickets to events including in the United Kingdom, regardless of the country in which the owner of the service is registered.

(2) A “ticket” means anything which purports to be a ticket, including any item, tangible or intangible, which grants the holder entry to an event.

(3) An “event” means any sporting, music or cultural activity taking place at a specified time and place for which tickets are issued and required for entry or attendance.

(4) An “event organiser” means the person or persons responsible for organising and holding an event and receiving the revenue from the event.

(5) A “fraudulent ticket” means a forged or duplicated ticket.

(6) An “invalidated ticket” means a ticket which has been cancelled by the event organiser, or an agent acting on their behalf, after being issued.’.

New clause 22—Prohibition of fees in contracts for services: letting of residential accommodation—

‘(1) The provisions in this section apply to a contract for a trader to supply a service in connection with the letting of a residential premises.

(2) Subject to the provisions of this section, any person who demands or accepts payment of any sum of money from a person (“P”) for services in connection with a contract for the letting of residential premises shall be guilty of an offence.

(3) For the purposes of subsection (2), P is any person—

(a) who seeks to enter a contract to let residential accommodation, or

(b) who has a tenancy of, or other right or permission to occupy, residential premises.

(4) For the purposes of subsection (2)—

“letting” shall include any service provided in connection with the advertisement or marketing of residential accommodation or with the grant or renewal of a tenancy;

“services shall —

(a) include, and are not limited to—

(i) the registration of persons seeking accommodation,

(ii) the selection of prospective occupiers, and

(iii) any work associated with the production or completion of written agreements or other relevant documents.

(b) not include credit checks of person seeking accommodation.

(5) Where a person unlawfully demands or accepts payment under this section in the course of his employment, the employer or principal of that person shall also be guilty of an offence.

(6) A person shall not be guilty of an offence under this section by reason of his demanding or accepting payment of rent or a tenancy deposit within the meaning of section 212(8) of the Housing Act 2004.

(7) A person shall not be guilty of an offence under this section by reason of his demanding or accepting a holding deposit.

(8) A “holding deposit” for the purposes of subsection (7) is—

(a) a sum of money demanded of or accepted from a person, in good faith for the purpose of giving priority to that person in relation to the letting of a specific property, which is to be credited towards the tenancy deposit or rent upon the grant of the tenancy of that property, and

(b) not greater than two weeks rent for the accommodation in question.

(9) Costs incurred by persons seeking accommodation for the undertaking of credit checks shall be reimbursed upon the signing of a tenancy agreement.

(10) In this section, any reference to the grant or renewal of a tenancy shall include the grant or renewal or continuance of a lease or licence of, or other right or permission to occupy, residential premises.

(11) In this section “rent” shall include any occupation charge under a licence.’.

Amendment 6, in clause 2, page 2, line 15, at end insert—

‘(3A) The Secretary of State may by order made by statutory instrument provide that those who represent businesses with fewer than 10 employees and are purchasing goods or services for use within their commercial activities will be considered consumers.’.

Government amendments 9 to 14.

Amendment 5, in clause 48, page 30, line 3, leave out from ‘(5)’ to ‘resolution’ and insert ‘may not be made unless a draft has been laid before and approved by’.

Government amendment 15.

Amendment 20, in clause 84,  page 43, line 14, at end insert—

‘(2A) Section [Prohibition of fees in contracts for services: letting of residential accommodation] extends only to England.’.

17:00

[Stella Creasy]

Like a pub quiz, we now come to the lucky dip round of the Bill, with a number of different issues being taken together. I am conscious that many Members wish to speak, so I will keep my remarks brief. [Hon. Members: “Hear, hear.”] I am always eager to please.

Let me start with new clause 8. A number of provisions have been proposed to deal with ticket touting—a subject about which I know many Members feel strongly. I shall also deal with new clause 22, which deals with fees. We have already tried today to abolish fees for debt management, and we would now like to abolish fees for tenants, which is what consumers need. I shall also talk about businesses and consumers, new clauses 13 to 15 and the Government amendments.

Ticket touting is an issue about which many of us are concerned. We see the damage it is doing to a range of industries by distorting prices and access to entertainment activities. Ticket bot machines—I am not sure whether all Members are aware of them—are pieces of software that impersonate individual visitors to ticket vendor websites and automatically make multiple ticket purchases. What does that mean in practice? It means that many of us as fans of music, sport or light entertainment do not get a look in. It means that millions of fans have never been able to get a ticket for a range of different events because all the tickets are sold out within minutes: they are sold to a machine, not to fellow fans. Those tickets are then resold at an exorbitant price.

According to Ticketmaster USA, one group of scalpers were requesting 200,000 tickets a day in this way. We certainly know that the secondary ticket market for the resale of tickets is worth up to £1 billion a year. Those MPs who are members of the Monty Python fan club—I see it in many of their speeches as they are certainly “the knights who say ‘Ni!’”—will be aware of the outcry after all the tickets for the Monty Python show disappeared in that way. Perhaps the Monty Python foot will fall on me for making that joke—the hon. Member for East Hampshire (Damian Hinds) seems to be making a face to suggest that it should. Those of us who are fans of the Stone Roses were horrified to see the band’s gigs automatically sell out in that way. Tickets for a Kate Bush gig were also taken out. They were originally sold for £49 but within minutes were on a resale site for £490. For the Stone Roses, tickets that should have been a mere £55 were being sold for £1,000 a time—well beyond the means of the average fan of such phenomenal music.

The Secretary of State has claimed that ticket resellers are classic entrepreneurs because they fill a gap that they have identified in the market. With the greatest respect, I fear that the new Secretary of State has misunderstood the market in ticket sales and quite what these businesses are doing by distorting people’s access. He presumes that consumers are able to compete fairly against these automatic machines, but that is simply not the case.

Let me be clear that our amendments are not designed to stop the resale of tickets. I told the Committee and I will tell the House that I was deeply disappointed to have to sit here late one evening and give up my tickets to see the great band, the Wonder Stuff. My hon. Friend the Member for Wolverhampton North East (Emma Reynolds) will know of the band’s work. I was looking to resell my ticket and, as a genuine fan, I wanted it to go to another fan so that they could hear the beauty and the wonder that is “Dizzy”.

What we are talking about is finding a way to make this work for the fans and the consumers, rather than the botnets. Our new clauses deal with the three clear issues. First, we want to apply to the secondary market the guidance about what information should be provided to a consumer when buying a product. There is clearly a gap in which these companies are profiting. There is confusion and a lack of information about what people are being sold. Some of us have had constituents tell us that they have been sold a ticket through a secondary reseller market only to find that it is a fake.

Secondly, we want to give greater protection for events of national significance. We know that there is widespread concern across the sporting industry about the real fans being locked out of games by these kinds of practices. I want to pay tribute to the work of my hon. Friend the Member for Eltham (Clive Efford) and the tireless campaigning he has done on the forthcoming rugby world cup. Millions of fans will not be able to attend events because of the actions of these companies and the touts.

Thirdly, we want to strengthen co-operation between the enforcement agencies and the secondary sites so that there is more protection for consumers and we can all be confident that when we buy a ticket for something, it is what we think it is and we can get a ticket in the first place.

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

Would my hon. Friend’s suggested reforms be able to deal with the appalling situation highlighted by my hon. Friend the Member for Blaenau Gwent (Nick Smith) whereby tickets for next year’s rugby world cup in the Cardiff Millennium centre—good stadium that it is—are now on sale for £1,560 for a £250 ticket? I would have thought that £250 is enough for the average rugby follower, but £1,560 is an absolute disgrace.

[Stella Creasy]

The new clauses and amendments would deal with that. I understand that the tickets for the rugby world cup are not yet formally on sale. The fact that they are already being marketed on secondary sites at such prices demonstrates the scale of the problem that we need to tackle.

I pay tribute to the tremendous and tireless work that has been done by my hon. Friend the Member for Washington and Sunderland West (Mrs Hodgson), who will speak about her new clauses later. I also pay tribute to what has been done by the hon. Member for Hove (Mike Weatherley). I know that the hon. Member for Shipley (Philip Davies), who has also tabled a new clause on this subject, shares the widespread concern that is felt.

[Philip Davies (Shipley) (Con)]

Will the hon. Lady give way?

[Stella Creasy]

I will, but only briefly, because I am conscious of the time, and I know that the hon. Gentleman wants to talk about a number of new clauses and amendments himself.

[Philip Davies]

Given what the hon. Lady said about not wanting to encourage the secondary ticket market, may I take it as read that she will support my new clause 12, which would guarantee people a refund from the organiser if they are not able to go to the event? If they cannot go and they cannot get a refund, they will not have much choice other than to sell the ticket on.

[Stella Creasy]

I think that the hon. Gentleman’s new clause responds to a slightly different challenge, and presents a practical challenge in relation to how it could be applied, but let me make one thing very clear, in case he did not hear me say it the first time. We are not suggesting that there should not be a market for the selling on of tickets; we are saying that what the ticket touts are doing is distorting the market for consumers. That is separate from the issue of whether people can obtain a refund within 24 hours. Let me caution the hon. Gentleman that some aspects of his proposal may not work in a practical sense, whereas we are presenting practical proposals.

New clause 8, in particular, has learnt the lessons of the Olympic and paralympic games. Tickets for those games were given particular protection to enable people to be confident that they could obtain them. The London Olympic Games and Paralympic Games Act 2006 levied fines of up to £5,000 for the reselling of tickets at a profit. The Home Secretary increased that to £20,000, citing the threat from serious and organised criminal groups. We know that ticket touting is being used to support a range of criminal activities. New clause 8 relates to events of national significance. Let us make sure that rugby fans can go to the world cup: it surely cannot be all that difficult to legislate for that.

New clause 16 seeks to get to the root of the problem, which is that people do not necessarily know what they are being sold. A unique identifier is a simple way in which to ensure that when someone buys a ticket, it is a ticket for a particular gig, show or match. The venues themselves will have already given out identifying information, whether it is a seat number or a stall number. We are suggesting that they should be required to provide that information at the point of sale, so that people can be confident about what they are buying. That will enable the event organisers to identify those in, for instance, rugby clubs who are already selling on tickets that they have been given and are misusing their relationship to give out the information.

We think that that accords very well with what the Minister said in Committee about the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013, which she believed would address the issues related to selling. She said that they

“set out…the information that a trader should provide to a consumer for all distance sales—which would include tickets”.

In particular, she said that they gave details of

“the main characteristics of the goods”.––[Official Report, Consumer Rights Public Bill Committee, 25 February 2014; c. 183.]

We believe that new clause 16 would simply put that into practice in the context of the secondary ticketing market, providing clarity for all who are concerned about what they are buying. It accords with consumer regulation, and we hope that the Government will support it, even if they fear that some of the other new clauses relating to ticket touting would be difficult to implement. We certainly hope that they will listen to the clarion call from new clause 8. Surely everyone, in the House and outside, agrees that it cannot be right for us not to be confident that it is the fans who are able to obtain tickets to attend events of sporting significance, whether they obtain them online or offline.

I know that other Members want to talk about ticket touting, and I shall therefore move on to the subject of letting agents’ fees.

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

The city of Glasgow is about to host the Commonwealth games, and a great deal of effort has been put into safeguarding tickets. Some of us have been shouting for a long time “Make ticket touting illegal!” Once it is illegal, we can take care of the other little bits and pieces, but should we not make it illegal right now so that we can know exactly where we are?

[Stella Creasy]

The new clauses and amendments are designed to make progress on issues of precisely that kind. One of the problems of ticket touting is trying to identify who is responsible for the crime that is taking place. Making the seller of the ticket give the details of that ticket will enable us to identify its provenance and who is selling it. We shall then be able to crack down on the people involved, whether it involves the rugby world cup or another event, so that organisations will not have their tickets sold on when they do not wish that to happen. It will give that kind of flexibility, and it reflects the all-party group work done on some of these issues. I hope there will be support from across the House.

[Mrs Main]

rose—

[Stella Creasy]

If the hon. Lady wants to suggest some tweets, I will happily take them, but I am sure everyone will appreciate it if we can move on to the question of letting fees.

[Mrs Main]

I am sorry that the hon. Lady is being so waspish; I am just seeking a bit of clarification. She mentioned the crime of ticket touting. Is she proposing to make it a crime, or does she believe it is a crime?

[Stella Creasy]

There are already criminal elements to what we are talking about. What we are talking about in this legislation is the information provided to a consumer—this is, after all, a consumer rights Bill—that could help address the problems caused by ticket touting, and it reflects the work being done by the all-party group. [Interruption.] Well, this is a separate issue about what we can do for consumers, and with that in mind I want to move on to new clause 22 because, as I have said, there is a lucky dip element to the amendments before us and it is about letting fees.

I pay tribute to the work done in this area by my colleague my hon. Friend the Member for Wolverhampton North East. I see first hand in my constituency the problems caused by increasingly difficult access to housing and affordable housing, particularly within the private rented sector. We know that 9 million people in England are living in rented homes and they are paying on average over £1,000 more a year in rent than they did in 2010. That is why we have to reform the private rented sector. The costs that people are facing are unsustainable. I have families in my constituency spending between 60% and 70% of their monthly income on rent alone. They cannot make ends meet.

There is a wider debate to be had about the length of tenancies and the levels of rent, but this amendment, like the previous amendments I was speaking to, relates to consumer legislation, and in particular the specific issue of fees and whether they should be charged.

[Mr Gordon Marsden (Blackpool South) (Lab)]

The issue my hon. Friend is outlining, and that our colleague my hon. Friend the Member for Wolverhampton North East (Emma Reynolds), the current shadow Housing Minister, has raised, is very important. It is particularly an issue for us in Blackpool and many other seaside towns, where, because of degrees of internal transience, some families have to move two or three times a year. That exacerbates the whole issue of letting fees.

[Stella Creasy]

I entirely agree. We see it in London as well, where people are having to move: every single time they move a fee is applied, and those fees are extortionate and are anti-consumer, as I shall explain.

The average such fee is about £355, but there are great variations. In my constituency of Walthamstow, in the work we have done on the “home sweet home” campaign, we found some fees as high as £827. We found renters being asked to pay fees for having pets, for having their houses cleaned and for a whole range of other practices, and we can see the consequences. We also know that 94% of letting agencies impose a fee on top of rent in advance and a deposit. There is therefore a huge sum of money for people to find. One constituent had to find £4,000 before he and his family could move into a property.

One in seven of those who use an agency are charged over £500 in agency fees before finding the deposit or rent in advance. Mystery shopping by Shelter found that some renters are routinely being charged £700. Over the past three years, one in four people who have dealt with a letting agency have said they have had to borrow money to pay that fee, which is of relevance to our previous debate. One in six is cutting down on food or heating to meet the cost of that fee, and four in 10 experience money worries as a direct result of that fee. If that fee is being applied every single year because people are moving again and again, we can see how quickly these sums can cause huge problems for consumers.

Some, perhaps those on one side of the coalition, will say what we need to do is make sure there is transparency. Certainly we explored whether people knowing the kind of fees they were facing—if everyone was upfront about the amount of money they were going to charge as a fee for introducing clients to a landlord, for example—could be one way of addressing this. That is a bit like somebody being tied to the train tracks and being told the train timetable, however, because in the current market many tenants have little option but to try to borrow to find that fee and then deal with the financial consequences. While I appreciate that one half of the coalition has now understood that fees are a challenge, the argument that simply knowing how much those fees are is enough in itself to deal with these problems simply does not wash. And nor does capping fees, because it is anti-consumer to have two different organisations paying for the same service. That is what we are talking about here: a form of double-charging. How can both the landlord and the tenant pay for the same service at the same time and the agent act in the interests of both? How can a landlord be confident that they are getting the best tenants if the agent also has the tenant’s interests at heart? How can a tenant be confident that they are getting a decent landlord if the landlord is also being acted for by the agent? This is fundamentally an anti-competitive practice and we think it is therefore time to act. Our new clause would do something very simple: it would clarify that renters could not be charged a fee.

17:15

[Damian Hinds]

The hon. Lady rightly talks about the difficulties that many people face in trying to find the money to pay these fees, but is it her assumption, and that of the Opposition, that were letting fees to be banned, that source of revenue would disappear for the agents but they would not seek to reclaim it elsewhere?

[Stella Creasy]

It is not simply an assumption; it is based on the evidence we have seen from Scotland, which is that this money would be incorporated in the centre of the tenancy and so that the landlord would pay the fee. We would expect the tenant to pay one fee—the credit referencing fee—but once the tenancy was secure and the landlord could therefore be confident that the person was back in the place, we would expect it to be refunded. We are very clear that the practice of charging fees to both parties at the same time is a conflict of interest and therefore needs to be addressed, which is what our proposal would do. It would spread the fee over the course of the tenancy.

[Damian Hinds]

Just to complete the point, is it also the hon. Lady’s assumption, and that of the Opposition, that were landlords to face greater fees, they would not seek to recoup that extra cost in some other way?

[Stella Creasy]

One issue is what landlords are charging for. I see landlords who are charging twice for credit referencing, because they are charging the landlord and the tenant that fee. [Interruption.] The presumption the hon. Gentleman makes is that all the fees are for different activities—

[Damian Hinds]

I am asking what your presumption is.

[Stella Creasy]

Our presumption is that the fees would then be taken on by the landlord and taken as part of the tenancy agreement. Our approach would resolve the problems we are seeing for tenants and the conflict of interest over whom the agent would act for. Our proposal is about making sure we deal with that conflict, particularly how for landlords and for tenants it creates a series of perverse incentives whereby both can be charged for the same service.

[John Stevenson (Carlisle) (Con)]

The problem is that if the letting agency loses an income it will seek to get it from elsewhere, so it is likely to increase its charges to the landlord. The landlord will then seek to recover that money, and from whom will the landlord seek to recover it? From the tenant.

[Stella Creasy]

I simply do not accept the picture the hon. Gentleman is painting. Scotland has banned fees on tenants, and the experience there has been an increase in the number of letting agents and no effect on the rents people are paying. The evidence shows that, as with the payday lenders, when we give tenants the muscle to remove this fee, the market shapes up. We have not seen an increase in the fees that tenants are facing; nor have we seen an exit from the market. Some of the fears the hon. Gentleman might have, which I understand, are not well founded, because a lot of the fees tenants are being asked to pay are not indicative of a service being provided; they are indicative of a profit-making machine. We are trying to deal with the detriment caused by the ability of agents to charge fees to two parties at the same time. By making this a fee for the landlord, it is clear whose interest the agent is acting in.

As I say, we have dealt with the particular issue here, because we have listened to the landlords and letting agents who have expressed concerns about tenants who may not be what they seem. In that instance, there would be a case for being able to charge a fee to the tenant which would be refunded, but the alternative of letting this practice continue and seeing the kind of fees that we are seeing, and therefore the problems that are being caused, is also unsustainable. I hope that Government Members, particularly those who have now recognised there is a problem with the fees in themselves, will go that stage further and recognise that there is a problem with this form of double-charging, support our proposals and learn from the experience in Scotland on this issue.

As I am conscious of the time, I shall move on; I appreciate that there are a number of Members who wish to speak in this debate. I am sure that the hon. Member for East Hampshire, who has made many useful contributions this afternoon, will get to speak in the following debate.

I briefly want to speak to amendment 6. It may come as a surprise to some to see the Government resisting the work of the Federation of Small Businesses, which is trying to help small businesses that are struggling with their consumer contracts. Members in this House may have first-hand experience of that, as we are, after all, small businesses and will have dealt with business-to-business contracts, and many may not realise that they have different levels of consumer protection as a result.

The FSB has recently published a report on small businesses which points out that it makes much more sense to give micro-businesses the same consumer protection as private individuals. After all, it is unreasonable to expect a micro-business to have the same level of legal qualification and expertise to deal with a contract as that of a larger body, and that is what amendment 6 addresses. I note that the FSB has given its support to this amendment. I was surprised when the Minister said earlier that the FSB did not support giving consumer rights to businesses. That has not been the briefing that we have had from it; indeed, it supports this amendment. Will the Minister set out when she expects to give small businesses the kind of consumer protection they need, because it will be one fewer worry for them?

I wish now to touch on some of the other new clauses. New clause 14 deals with Ofcom and switching. We certainly think this is a good idea, and we wish to see the Government following it through. I am sorry that the hon. Member for Shipley (Philip Davies) was not here earlier when we were debating new clause 3 and new schedule 1 and making it easier for consumers to be able to switch. We recognise that there are problems. It is unusual for the UK, by comparison with other nations, to have this issue, and it will be interesting to know whether the Minister is considering it.

I look forward to the hon. Member for Shipley making his case for new clause 13. I certainly agree that transparency is important. The laws governing animal welfare at slaughter, at both EU and UK level, require animals to be stunned before slaughter, but they make an exemption to that requirement for religious slaughter, which is carried out by members of the Jewish and Muslim communities.

We are concerned about whether this amendment has a significant effect on animal welfare and implications beyond that. In particular, we must ensure that our laws strike the right balance between concern for animal welfare, which many of us have, transparency for consumers and respect for the traditions of different businesses and different communities. We also recognise that a lot of work has already been done on this matter in the European Union, and it would be sensible to learn some of the lessons on the wider issues such as how goods and foods are labelled. It will be interesting to hear the hon. Gentleman’s views on that—perhaps not on Europe but on the research that is being done.

I am sure that the hon. Gentleman would not want to make a law that caused confusion in this area rather than clarity. He focuses on halal and kosher food, but the Opposition believe that respect implies an active attitude towards others rather than a passive attitude, and certainly our position is to seek proper engagement with all faith groups before we move forward on such a measure.

Let me turn now to new clause 15, which has been tabled by the hon. Member for Foyle (Mark Durkan). We supported it in Committee and would support it again. It is an incredibly important amendment and I urge Members to listen to what the hon. Gentleman has to say. We do not believe it is acceptable to leave it to consumers to know whether they have a death trap in their house.

Finally, I want to say a bit about Government amendments 14 to 20 and the very welcome U-turn that seems to have been made. In Committee, we were concerned that consumers could be left waiting many months for a refund, but the Minister suggested that the Government believed there were potential disadvantages of introducing a time limit that outweighed the benefits that such a change could bring. We suggested 30 days in which to get a refund, so I am absolutely delighted that the Government have gone one stage further and said that people should get their money back in 14 days. That gives me great hope that while the Minister may be saying “computer says no” at the moment to some of the things that we have been talking about today and in Committee, we will see further concessions in due course. We shall welcome them accordingly.

[Philip Davies]

It is a pleasure to follow the hon. Member for Walthamstow (Stella Creasy). I was, surprisingly, rather encouraged by her response to my amendments. It could be a red-letter day for me, getting support across the House for some of my amendments.

I want to focus mainly on new clause 13, which is about the labelling of halal and kosher meat at the point of sale. With your permission, Mr Deputy Speaker, I will seek to press it to a vote, should the opportunity arise. It is an issue of great importance to the public, and we have heard an awful lot of commentary on it in the media and among many of our constituents in recent weeks. They would appreciate seeing where their Member of Parliament stands on the issue.

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

When the hon. Gentleman says that the issue is of great importance to the country, he means the Daily Mail and The Sun.

[Philip Davies]

The hon. Lady needs to get out more, to be perfectly honest. She would find that there is widespread concern about the issue. She can vote accordingly and should not have anything to fear from a debate or a vote. I do not see why she should seek to object to either thing—that is what we are supposed to be here in Parliament to do, after all.

As you know better than anyone, Mr Deputy Speaker, I enjoy the cut and thrust of debate in the Chamber, but I am well aware of the time limitations and that other Members want to speak. I have given way once, but I will try to resist the temptation to give way many times because I want to hear what others have to say, too, and there is a lot to get through.

[Sir Greg Knight (East Yorkshire) (Con)]

I am sorry to test my hon. Friend’s resolve so early in his speech, but this is an important point. On reflection, does he not agree that his new clause on halal meat—[Interruption]—and kosher could have been better drafted? If we are to have labelling, is it not important that the labelling specifies whether the meat was pre-stunned halal or non-pre-stunned?

[Philip Davies]

I have resolve, but I can seldom resist giving way to my right hon. Friend. Animal welfare is a big issue for lots of people, but it is not the only one. Many other faith groups are concerned about the blessing given to the meat before sale, and his proposal would not address their particular concerns. My new clause has been drafted with all such people in mind, because the issue is bigger than one only of animal welfare. Animal welfare is an important element, but not the only element. I will come on to that later.

I want to start, however, with new clause 12, which relates to ticketing. The hon. Member for Walthamstow said that my new clause had nothing to do with her new clauses, but nothing could be further from the truth—it very much has. We know what her long-term agenda is, because she let it slip in an intervention: ultimately, she wants to see the end of ticket touting and the secondary sale of tickets. I think that that would be a massive retrograde step. The Select Committee on Culture, Media and Sport, on which I serve, looked into the matter in the previous Parliament and found that such activities were a legitimate area of business. The Office of Fair Trading, as well as the Committee, found that it works in the consumer’s best interest.

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

Will the hon. Gentleman give way?

[Philip Davies]

I will stick to my resolve. The hon. Lady and I have locked horns on the issue over years. If anyone wants to look at our previous debates, they can go back to Hansard and see them all rehearsed there. I am sure that she will get the opportunity to have her say in a bit.

Fifty per cent. of tickets on viagogo are sold at a loss, so the idea that all people touting tickets are selling them at huge profits is simply not true; most are sold at a loss. The principle is this: if I buy a ticket, as far as I am concerned it belongs to me. I should be able to do with that ticket what I choose to do, including selling it on to someone else, as I can with any other commodity. Other products have limited editions, which are popular, such as designer handbags or Buzz Lightyear toys from years back, and people go in, buy the lot for a small amount and sell them on at an inflated price on eBay a few hours later. If the Labour party wants to ban that happening with tickets, presumably it will say that that kind of behaviour should be banned as well. That is complete nonsense.

Event organisers do not lose out at all, because all the tickets are sold at the price that they wanted to get for them—all the income that they wanted is delivered. The idea that real fans will be deprived of going to an event is complete nonsense. If someone is prepared to pay £1,500 for a ticket, you can bet your bottom dollar that they are a real fan. Not many people are prepared to pay £1,500 for a ticket for something that they do not really care about going to. It actually guarantees that real fans go.

17:30

[Stella Creasy]

rose—

[Philip Davies]

I am not going to give way for the reasons I mentioned earlier.

If I have a ticket to the Lords test match, for example, or to the rugby world cup final, and I go into my local pub and someone says to me, “It is my lifetime ambition to go there, I would give £4,000 for a ticket,” what is wrong with my saying that I will give up my ticket and they can go instead? Everybody is happy, nobody has lost out, but Labour want to interfere with people’s aspirations. Why should that be banned? If someone does not want to pay the higher price, they should not pay it. Nobody is forced to pay the inflated prices if they do not want to.

If the secondary sale of tickets bothers event promoters so much, why do they not do something practical to stop it? Why sell all the tickets in one go, for example? Why not hold them back? Why put them all on sale so that they are sold within 43 seconds, meaning that they can be resold at inflated prices? If promoters are so bothered, why not sell tickets bit by bit, week by week, month by month so that there are still tickets available the week before the event? That would remove the secondary ticketing market, but they choose not to do it. That can only lead me to presume that the event organisers are shedding crocodile tears, as they are happy to get all the money from the tickets being snapped up.

An ICM poll showed that 83% agreed with the premise:

“Once I’ve bought a ticket it is my property and I should be able to sell it to just as I can any other private property.”

[Mr Marsden]

Will the hon. Gentleman give way?

[Philip Davies]

I am not going to give way.

This situation is very similar to the one I experienced when I was at Asda and we broke the net book agreement. Publishers had the right to set the price of books and nobody could undercut it, but Asda went to court and broke that agreement so now books can be sold at any price the retailer wants. It seems to me that Labour wants to go back to a time when publishers of books could set the price for books and ticket providers could set the price for tickets and nobody could do anything about it.

New clause 12, which guarantees that an event organiser must give somebody a refund up to 24 hours before an event, is essential if the Opposition want to get their way. If they want to ban somebody from selling on a ticket for the rugby world cup final, the only option for somebody who has bought a ticket and cannot go would be a refund. On too many occasions, event organisers will not allow refunds for events so what on earth is the customer supposed to do in such circumstances? The Opposition will not support insisting that they get a refund and they want to ban them from selling the ticket on, so somebody will be left with a ticket that they can do absolutely nothing with. How on earth can that be in the best interest of the consumer?

On the subject of the rugby world cup final, if people from New Zealand buy a lot of tickets for the final in the expectation that their team will get there only for it to be knocked out in the semi-final, we need a mechanism by which those fans can sell on their tickets to the fans of the team that will be in the final instead. It seems that the Opposition have not even thought about that prospect. The secondary market in tickets is an efficient way of getting tickets from one group of people to another so that the real fans can go. If Labour had its way, the real fans would not be able to go because they would be blocked from using any mechanism to get there.

I want to concentrate on new clause 13, which says:

“All products containing halal and kosher meat shall be labelled as such at the point of sale by retail and food outlets.”

For the purposes of the new clause, I have defined a food outlet as

“anywhere where food is served to the public.”

I have done that because I specifically wanted to include places such as schools and hospitals, as I think many parents and patients are concerned about food that they do not know the provenance or background of, and that information is important to them.

[Shabana Mahmood (Birmingham, Ladywood) (Lab)]

If that is the hon. Gentleman’s intention, his clause is far too simplistic. Does he not agree that in the interests of fairness and consumer transparency consumers have the right to know about the origins of non-religiously slaughtered meat, whether that meat has been stunned or not, if it has been stunned what method was used and the method of non-religious slaughter? That is a lot of information, but observant Muslims or Jews would like that information as well as people who object.

[Philip Davies]

I have a great deal of sympathy with what the hon. Lady says. She seems to be making the point that we need more labelling, not less. If she is saying that my new clause is a step, but it does not go as far as she would like it to go, I am happy to take that criticism on the chin.

[Mr Jonathan Djanogly (Huntingdon) (Con)]

I support further labelling, but does my hon. Friend agree that it is wrong to look at religious slaughter in isolation from other forms of slaughter, as the hon. Member for Birmingham, Ladywood (Shabana Mahmood) said? Labelling could give information about how the animals lived—their housing, food and drug consumption. Why is he picking on religious communities in his new clause?

[Philip Davies]

Let me make something clear. I am not picking on anyone. I do not want to ban anything. People want to buy religiously slaughtered meat, although that may not be my choice. It is Labour Members who want to ban everything that they do not happen to like. That is not my style. I happen to believe in freedom of choice, and I want people who want to buy religiously slaughtered meat to be free to make that choice. Equally, people who specifically do not want to buy that meat should be free to make that choice. So this is not about picking on anyone. It is not about trying to ban anybody from doing anything.

I do not really see who loses out from the new clause. It is to the advantage of those people who want to buy halal and kosher meat and to the advantage of those who specifically do not that meat is properly labelled. So I do not see who the victim of my new clause is. Everyone is a winner. It is to everybody’s advantage that meat is properly labelled and above board so that everyone knows that what they are buying is what they want to buy. That is the only intention behind my new clause; there is no other objective. I am not seeking to ban anything or stop anybody from doing anything they want to do. I merely seek to allow people to make an informed choice. My hon. Friend the Member for Huntingdon (Mr Djanogly) asks why. The simple reason is that there is a huge demand for labelling out in the country—there certainly is in my constituency. That is why I introduced a ten-minute rule Bill on this very issue two years ago. It was defeated by three votes, largely by the politically correct brigade on the Opposition Benches. It was a big issue in my constituency then. I contend that it is an even bigger issue today. It has not mushroomed out of nowhere. There is widespread customer demand that proper information be given so that people can make an informed choice.

[Mike Weatherley (Hove) (Con)]

Will my hon. Friend give way?

[Philip Davies]

I have said that I must make some headway.

British legislation requires the stunning of animals before slaughter, with the religious exemptions that the hon. Member for Birmingham, Ladywood (Shabana Mahmood) made clear. Religious traditions sometimes require people to slaughter without stunning. The exemption dates back to the Slaughter of Animals (Scotland) Act 1928 and the Slaughter of Animals Act 1933, which applies to England and Wales. The EU also granted derogations from stunning regulations for religious communities.

In recent years, animal groups, most notably the Farm Animal Welfare Council, have advocated labelling of some meat to decrease the amount purchased, thereby reducing the amount of unstunned meat, as my right hon. Friend the Member for East Yorkshire (Sir Greg Knight) said.

Neither the British Parliament nor the European Parliament has passed a law that requires labelling of unstunned meat, but there has been much debate about it in the past. My new clause would make it compulsory for halal and kosher meat to be labelled because, as a strong believer in freedom of choice, I think that one of the fundamental rights of the consumer is to know what they are purchasing.

I spent 12 years working for Asda before I entered the House. Some of the supermarkets are reluctant to do anything about this because it is inconvenient for them to go through the food chain to provide the labelling. When I was at Asda, I was taught that we were in business to do what was best for the customer—to do what the customer wanted, not what was for our convenience. I am rather worried that that attitude is slipping in some of our supermarket chains. It is not about what is most convenient for them; I do not care about that. They should be delivering what their customers want, and there is no doubt that this is what customers want to see.

Consumers cannot satisfy their preferences at present because not all meat products are labelled. Therefore, legislation requiring labelling is essential for consumers to exercise their right to make an informed decision.

[Mike Weatherley]

Will my hon. Friend give way?

[Philip Davies]

I am not going to give way.

I would much prefer it if legislation was not required. I am not the type of person who wants to rush to legislation, but in the two years since my ten-minute rule Bill was introduced absolutely nothing has happened. There have been plenty of opportunities for the retailers to sort this out for themselves, and they have failed spectacularly to do anything about it.

This is important. According to the EU DIALREL project, the exemption from religious slaughter in schedule 12 to the Welfare of Animals (Slaughter or Killing) Regulations 1995 clearly states that the exemption applies to people of that religion—not to everybody. That implies that halal and kosher meat should be consumed by those of Muslim and Jewish faiths respectively, because that type of slaughter is specified for their religious needs. That is clearly not the case, because Muslims make up a small proportion of the UK population, yet the Halal Food Authority estimated two years ago that halal meat makes up 25% of the meat market. I suspect that the figure is even higher. Similarly, approximately 70% of kosher meat that is sold is not consumed by the Jewish community.

We are going far beyond the exemption that was designed for those people with their particular religious beliefs. There have been cases of schools, hospitals, pubs, sports arenas, cafés, markets and hotels serving halal meat to customers without their knowledge. I am led to believe that it even happened in the House of Commons canteens in 2010. To my dismay as a former retailer, it has certainly happened in some of the larger supermarket chains, and in some of the largest food outlets such as Pizza Hut, Domino’s and KFC. It has also happened in schools. In 2010, Harrow council faced a massive protest after announcing a plan to serve halal-only menus in the borough’s state primary schools, and parents complained that it was forced on them against their will.

Some 98% of consumers in the 2004 Co-op survey of consumer attitudes to the ethics of the food industry stated that they supported the humane treatment of animals. Considering that some halal and kosher meats are slaughtered without pre-stunning, many such consumers would not buy the meat if they were aware of what it was. Interestingly, Massood Khawaja, president of the Halal Food Authority, stated in September 2010:

“As Muslims have a choice of eating halal meat, non-Muslims should also have the choice of not eating it. Customers should know it is halal meat.”

An amendment to induce the compulsory labelling of unstunned halal and kosher meat and products would give consumers more freedom of choice, increase market efficiency, as retailers are enabled to respond to customer demand, and help to protect animal welfare rights.

It is not just me who thinks that. The Sikh Council UK has put out a statement agreeing with that. It believes that everyone has the right to purchase and consume food in accordance with their religious beliefs. Hindus have said that they, too, agree with my new clause, and believe the same thing. Many of these groups do not focus on animal welfare but specifically object to the religious blessing that goes with the practice. I will conclude with this particular point about halal and kosher meat. I do not know if hon. Members read the article by Taj Hargey, the director of the Muslim Educational Centre of Oxford and the imam of the Oxford Islamic Congregation, who said that the practice is

“covert religious extremism and creeping Islamic fundamentalism making its way into Britain by the back door. It is completely wrong that the food sensitivities of Britain’s Muslims—who amount to just 4.8% of the population—should take precedence over the other 95%. Halal meat should never be forced on customers without their knowing, surreptitiously and using clandestine methods. It’s unfair to everyone, non-Muslims and Muslims alike.”

He also said that the idea that Muslims cannot eat non-halal meat is completely wrong, and

“has no theological basis in the Koran, the supreme text of Islam.”

He said:

“I’m a dedicated Muslim, a devout religionist, an imam and intellectual scholar of Islam, but I eat whatever food is placed before me, with the obvious exception of pork. If you’re kind enough to invite me to your home, I would eat whatever meat you chose to serve”.

He concluded:

“It is high time the white, liberal, Guardian-reading classes stopped behaving like apologists and woke up. There is a fundamentalist Trojan horse in our midst, and we must take corrective action.”

Many people in this country are demanding that this House take the action that they would like to see.

17:45

Finally, and very briefly, new clause 14, which the hon. Member for Walthamstow said she supports, and which I hope the Minister will support, would introduce a mobile phone switching process that is led by the receiving communications service provider, rather than the one losing the custom. Currently, if someone wants to cancel their mobile phone contract, they must first approach the company they are leaving. The problem is that mobile phone operators have no incentive at all to proactively ensure that their customers are getting the best deal. They can overcharge them again and again until they say, “Actually, I want to leave”, before trying to win them back with some offer.

New clause 14 would keep mobile phone providers on their toes, ensuring that their customers constantly got the best real-time offer, because they would never get the chance to do that if the customer went to a competitor. They would act in the best interests of the consumer. That would be in line with what now happens in the banking and energy sectors. It is widely appreciated that the best way to encourage switching for consumers is to enable them to go to the provider they want and for it to do all the hard work for them. It is an anomaly that that does not apply to mobile phone switching. I think that it would make a great deal of sense for the Government to accept the new clause. I am pleased that the Opposition have agreed to support it and hope that the Government will too. It is a common-sense measure that will ensure a much better deal for consumers.

I will bring my remarks to a close. I look forward to hearing what other Members have to say. For your benefit, Mr Speaker—you were not here at the start—I repeat that if the chance arises I would very much like to press new clause 13, on labelling halal and kosher meat, to a vote, because I think that it is a matter of great importance to many people in the country.

[Mrs Hodgson]

I am delighted to be able to speak on new clauses 18 to 21, which stand in my name and those of the hon. Member for Hove (Mike Weatherley) and other hon. Friends. I add my support to new clauses 8, 16 and 17, which were tabled by my hon. Friends on the Opposition Front Bench and ably argued for by my hon. Friend the Member for Walthamstow (Stella Creasy) this afternoon and in Committee.

New clause 18 follows directly from the conclusions and recommendations of the recent excellent report by the all-party group on ticket abuse. I want to put on the record my thanks to colleagues across the House and all the outside experts who contributed to that excellent report. We found that the existence of a secondary market for event tickets is justified by the need of genuine consumers to pass on tickets that they can no longer use. To some extent, that is because event holders are not very good at facilitating refunds or exchange mechanisms, even though they sell tickets many months in advance of the event.

On that point, I will speak briefly to new clause 12. It is a shame that the hon. Member for Shipley (Philip Davies)—he is not listening now—would not allow any interventions, because I wanted to correct for the record some of the errors in what he said. He is right that we have regularly locked horns on the issue, but that does not mean I will sit back and not seek to correct him when I think he is wrong. First, the Opposition are seeking not to ban the resale of tickets, but to regulate and reform the market in the interests of consumers through these very sensible cross-party proposals. My hon. Friend the Member for Walthamstow did not “allude”—I think that was the word he used—to trying to ban the resale of tickets.

Secondly, the hon. Member for Shipley was incorrect to claim that no one gives refunds at the moment. The Rugby Football Union guarantees full refunds for high-demand matches—I am sure that the world cup would qualify—up to an hour before kick-off. It also provides legitimate resale platforms. This ensures that any investment goes back into the sport of rugby. The England and Wales Cricket Board has established ticket exchanges at each venue and centrally so that a supporter who can no longer attend a match or has a spare can legitimately re-sell their ticket. Those are just two examples among many more that are out there.

[Nick Smith (Blaenau Gwent) (Lab)]

Does my hon. Friend agree that new clauses 16 and 18 are particularly powerful, because they would enable us to identify the power sellers—the people who buy tickets on an almost industrial scale, and by doing so corner the market, rip off consumers and push up prices? Unless we do so, it is more likely that £250 tickets for the rugby world cup can be sold for over £1,000, as is happening at the moment. That has to be a bad thing, and we must stop it.

[Mrs Hodgson]

I agree with my hon. Friend. I thank him for his work in the all-party group in producing the report that has led and informed us in tabling the new clauses.

Our report recommended that the live event industry should do more to provide refunds. The new clause tabled by the hon. Member for Shipley could be ruinous for the live event industry while removing all the risk for the industrial touts of whom my hon. Friend the Member for Blaenau Gwent (Nick Smith) spoke. Most touts will aim to sell their tickets on the internet about four days in advance, so under the hon. Gentleman’s plans, any they do not manage to sell for a profit they could simply give back to the promoter for a full refund the day before, by which time the promoter will be unlikely to be able to sell them all on again. I fear that rather than helping ordinary consumers, as the hon. Gentleman has no doubt argued, that would mean more tickets being acquired by ticket touts who no longer face the uncertainty of whether they will be able to shift them, thereby manipulating the supply even more than they already do. A better balance would be to give refunds up to a reasonable point before the event, with facilitated resale after that if the event has sold out—as we set out in our report, which I hope the industry will take on board.

While accepting that there is a role for a legitimate secondary ticket market, the all-party group found considerable problems with how this market, which is estimated to be worth about £1 billion a year, works at present. In particular, we found that it does not adhere to the same principles of transparency and consumer protection that other markets are held to. To address these shortcomings, we have put together some modest proposals which, far from driving ticket resale underground, as some of those involved in it have claimed, would increase consumer confidence in the secondary market and therefore be very good for business.

Our first two new clauses address the lack of transparency. New clause 18 is about who is selling the ticket. It would place a duty on secondary ticketing platforms to provide basic identifying information about the individual or business offering a particular ticket or set of tickets for sale. It would allow consumers to say how prolific and reliable a particular seller is—in other words, whether they are a tout or a fellow fan and, if they are a tout, whether the tickets they have sold in the past have been as advertised. That would make the secondary ticketing platforms a lot more like the other internet marketplaces that many of use regularly and with confidence, such as eBay, Amazon and Play.com.

Importantly, the new clause would also require secondary ticketing platforms to be transparent in cases where the seller is also the event holder. The practice of event organisers secretly allocating whole blocks of tickets directly to the secondary market has been on the rise, due to the failure of successive Governments to intervene in the market on behalf of consumers or the creative sector. It was exposed in the Channel 4 “Dispatches” programme, “The Great Ticket Scandal”, broadcast in 2012. I cannot blame those who do this. They cannot stop the touts, who have not contributed in any way to the event—unlike the artist, the venue, the agent, the promoter, and so on—from making huge profits off the back of their hard work, so why not try to make some of that money for themselves, or, as I like to see it, have a piece of the poacher’s pie? That is their decision, but they should have to be transparent about it. Hiding behind the secondary market and allowing fans to believe that the ticket they are buying has been sold at face value before and they are buying from a third party is simply dishonest.

There is also a dishonest practice whereby a secondary ticketing platform or its employees or shareholders buy and sell tickets themselves, as the “Dispatches” programme also exposed. Employees of the platforms featured were shown with catalogues of credit cards, trying to buy as many tickets as possible to gigs. A leaked operations manual sent to me shortly after “Dispatches” aired showed that that was also a key part of the viagogo business model. The manual showed, among other things, that a company called Andro Capital, which was linked to viagogo’s then chief executive, Eric Baker, was also its most favoured power seller. Interestingly, a box at the start of the chapter explaining such dealing to employees stressed:

“Not only do we have private and power sellers, we also sell tickets on the website. PLEASE NOTE THAT NEITHER SELLERS NOR BUYERS SHOULD KNOW THAT WE ARE THE SELLER OF CERTAIN TICKETS. NOR SHOULD ANY OF THE INFORMATION BELOW BE DIVULGED TO OUR POWER SELLERS!”

Viagogo has since said that it has abandoned that practice, and Christoph Homann of GetMeIn! also assured the all-party group in his evidence that it does not itself buy tickets, either. In that case, they will not be affected by the new duty and have no reason to oppose it. Even if they or other secondary ticketing platforms still engage in such dealing, I can see no good reason why the law should permit them to keep that information secret from their consumers when it may make a material difference to a buying decision. I hope, therefore, that the Minister will consider adopting the measure.

I have mentioned the Channel 4 “Dispatches” investigation into the problems and I am also pleased to inform the House that the BBC’s “Watchdog” is also very keen on highlighting them. Indeed, they will feature in its shows on 21 and 28 May, and I am sure that hon. Members on both sides of the House will be glued to their TVs, watching them. “You and Yours” on Radio 4 also runs regular features on the issue, as do numerous national newspapers, including The Mirror, the Daily Mail and The Times, as well as trade magazines, such as the excellent Audience.

New clause 19 relates to the transparency of the product itself—that is, the ticket. Knowing the characteristics of a ticket would in many cases make a material difference to a buying decision, particularly in the case of seated events, in which a person’s position in the venue can make a significant difference to their enjoyment of the performance or the experience. Providing that information —or, indeed, the ticket number when there is general admission to the event—would also give consumers the confidence that the individual or company selling the ticket actually has tickets in hand and is not just speculating that they will be able to provide them at a later date. When a consumer wants to buy a number of tickets, the information will help them to ensure that they get seats together or at least close by.

The secondary platforms themselves were asked about that as part of the all-party group’s inquiry. StubHub said in its evidence that it requires seat information to be provided, but an investigation of its website shows that such information appears to be hit and miss. On the whole, it tended to be single tickets, which were probably being sold by ordinary fans, that had full information, while listings of two, four, six or more tickets, which were probably being sold by a professional, did not.

One of the other key pieces of information of which a consumer should be aware is a ticket’s original face value, which in many cases is another indicator of the quality of the product. In their evidence to the inquiry, representatives from the Rugby Football Union said that the cheapest tickets at Twickenham—those they keep cheap to try to get families to come along and to encourage grass-roots participation—often end up being resold at higher prices than some of their premium tickets, some of which may still be available.

Many consumers who are less conscious of how these secondary markets work think that because they are paying more for a ticket, they will get a premium service or seat. Many others do not even know that the website they are using is a secondary market rather than the primary or official source, given that such sites pay significant sums to show up first in Google rankings. Making sure that consumers are made aware of the original price of the ticket they are buying at the earliest opportunity, not just on the last screen—if at all—therefore gives them another piece of the information that they need to make an informed choice about whether to enter into such a purchase.

18:00

I do not think that any genuine fans who needed to sell on their tickets would have a problem with providing the basic information about the product they are selling, and I cannot see why any professional reseller would either. Even a street tout shows people a ticket—and therefore the seat number and face value—before they buy it. The secondary ticketing platforms, which claim to have higher standards, should therefore have no problem adapting to the new provisions.

Moving on from transparency, more of which should reduce the chances of things going wrong in the secondary market in the first place, new clause 20 concerns the recourse available to consumers when they do. There have been numerous recent reports of thousands of event goers being turned away with counterfeit or invalid tickets that they had bought via the big four secondary ticketing websites, all of which heavily promote their reliability, with prominent guarantees that tickets are genuine. The latest example to make the news involved the hundreds of Drake fans turned away from the O2 arena in north Greenwich.

It is welcome that all the big four companies say that they offer refunds, although over the years I have received a handful of complaints about their being less than prompt in doing so. As Reg Walker from the Iridium Consultancy pointed out during our second evidence session, people who turn up at venues with unusable tickets have all incurred at least some travel costs getting there, and in some cases they have come from abroad for the express purpose of using the ticket. That echoes the findings of the recent UK Music report on music tourism, including that ancillary spending just from music events is worth more than £2 billion a year to the country’s economy.

For such people, a full refund on the ticket, while welcome, will still leave them out of pocket. New clause 20 would, therefore, allow those consumers to claim back the extra costs associated with attending an event up to a reasonable level, which we suggest should be 200% of the total purchase price paid to the platform. The new clause would place responsibility for that initial payback on the secondary ticketing platforms, because they offer guarantees that they say consumers pay for in their significant service charges. However, having paid out that money, the new clause makes it clear that the secondary ticketing platform may recover it from the seller of the ticket. The payback should be made promptly, unless the police or other relevant authorities are investigating the buyer or seller for committing or trying to commit fraud. The only individuals or businesses that the new clause would hurt, therefore, are those who have sold dodgy tickets and consequently caused financial loss to the consumer.

The new clause would have the positive benefit of giving consumers the confidence that they will not be left out of pocket when they purchase tickets through the secondary market if those tickets turn out to be counterfeit or invalid. Again, far from driving the trade in tickets underground, it would have the effect of driving consumers to use websites that offer such protections, instead of those that do not and, in particular, instead of blokes outside the venue on the night.

Our last new clause, new clause 21, simply defines terms used in the previous three new clauses, so I will not detain the House by explaining it.

The proposals are not radical. If the Minister or hon. Members whom have spoken against them asked their constituents whether they want to know what they are buying and whom they are buying it from when they spend what are often significant sums, they would find that most of them said yes. The proposals would not abolish the secondary market or drive it underground; in fact, they would bring it out of the shadows into the mainstream. No longer would so many people still see it as a murky market; it would be a legitimate secondary market that works—as all markets should—in the interests of consumers, with full transparency and adequate protection. The only people who have opposed the proposals are those making large amounts of money from the status quo. It is time that this House and this Government stopped standing up for the interests of such people, and finally put fans first.

[Mike Weatherley]

I congratulate the hon. Member for Washington and Sunderland West (Mrs Hodgson) on a thorough interpretation of the new clauses.

Music, theatre, comedy and sport are a vital part of British society and the British economy, and our creative industries are worth more than £36 billion a year. They generate £70,000 every minute for the UK economy, and employ 1.5 million people in the UK. That is why it is vital to have a healthy and transparent ticket market, yet with increasing frequency, secondary ticketing resellers are causing dramatically inflated prices for the fans, and taking away revenue from performers. That has to stop.

I have consistently been a champion of the free market and I do not have a problem with artists or sports teams charging whatever they wish for their services. That is their prerogative, and they should be allowed to set the prices of their tickets or, if they choose, to sell them through secondary ticketing or auction websites. However, as the online marketplace has become quicker and easier to use, a large number of unsavoury and illegal practices have sprung up surrounding ticket reselling websites. That is why I, along with colleagues from both sides of the House, founded the all-party group on ticket abuse. We conducted a review and the results were published recently, as we have heard, with new clauses recommended as a result.

One key aspect of an honest and transparent ticket purchasing process is the intention of the buyer at the point of purchase. No one would begrudge a Rolling Stones fan who has become ill the day before the show the opportunity to sell their ticket to someone else. However, an increasing number of people are buying tickets with absolutely no intention of going to the event. Instead, those career touts buy tickets solely with the intention of denying them to real fans, whom they can squeeze for profit by reselling their tickets to a “sold out” event.

That situation is not limited to fans who simply waited too long to buy tickets. With internet ticket selling becoming more streamlined, touts are able to use sophisticated computer systems to buy large volumes of tickets automatically mere seconds or minutes after they go online. That can often mean that it is practically impossible for genuine fans to get access to the event, forcing them to rely on an artificially created secondary market, and depriving content creators of revenue for their event. That is unacceptable.

On this issue I fundamentally disagree with my hon. Friend the Member for Shipley (Philip Davies), who raised some points earlier, because we would all suffer, including the artists. Just because an artist has received the full value for a concert that is sold out does not mean that they—or another artist—would not suffer elsewhere. For example, suppose someone has a budget of £500 a year for going to venues. They might think, “I’ll go to 10 concerts in that year and buy some merchandising and other products while I am there”, but if they then spend £200, £300 or even £500 on one concert, they will not go to the other nine. No wonder there is underselling in other concerts because people do not necessarily have the money, and we all lose out as a result.

[Philip Davies]

indicated dissent.

[Mike Weatherley]

My hon. Friend is shaking his head, but he must understand that my point is right. I would, of course, prefer no legislation on the subject and to rely on industry-led solutions, as we heard earlier. A potential solution to touting, which has been adopted by some venues already, is to use credit card verification. However, touts often generate such large profits from many events that that method is ineffective. There are also additional problems of crowd control and so on. If hon. Members who disagree with that point had bothered to come to the all-party group when we took evidence, they would have heard from promoters who have tried those other methods that such things do not work, and they would not try them again for all sorts of reasons.

The Metropolitan police published a comprehensive report on fraudulent ticketing and the dangers it posed to the Olympics; it specifically cites ticket fraud, touting and ticket reselling websites as areas of concern. Among several issues, the Met noted that websites with servers based overseas were causing serious problems by advertising fraudulent tickets, and making it difficult for law enforcement agencies to track the offenders or shut down illegal sites. The report stressed—as do I—the need for an open and transparent system for ticket reselling, with clear and appropriate regulations.

Transparency is key to protecting not just content creators but ticket buyers from dubious and misleading transactions. Again, I will refer to my hon. Friend the Member for Shipley because I never thought there would be a connection between halal meat and secondary ticketing. I was keen to intervene on him but he would not allow me to. All through his speech, however, he made the point that clear labelling and the consumer being aware of what they were buying was fundamental. He said—I wrote it down—that it is a fundamental right that consumers know what they are buying. That is exactly what the new clauses are saying, no more and no less. For instance, it is common in the entertainment industries for all or part of the fee for professionals involved in an event to be paid in tickets. The venue might be paid in tickets to a corporate box and a promoter or manager may be given some as part of their fee. That is done with the tacit understanding that recipients of such tickets will subsequently be able to sell them for significantly more than their face value. It is, of course, the prerogative of the content creators if they wish to do this, but it should be done transparently.

Some hon. Members, including my hon. Friend the Member for Shipley, have suggested that trying to regulate ticket touting is an interference in the natural free market. However to say this is to misunderstand—and be wrong about—one of the key principles of the free market, which is the ability for the market to respond to demand by increasing supply. In the case of sports matches or live music, there is no way to increase the supply. There are only so many games in the season and bands can only play so many dates. That is why it is so important for the content creators to be in control of how their tickets are sold. It does not in any way infringe their right to charge however much they want for the tickets, as long as it is part of a transparent and well regulated system that works in the best interests of fans and performers.

New clauses 18 to 21 are intended to assist that transparency. None of the clauses would restrict the secondary markets, but they would become more accountable. In particular, people who had been sold an invalid ticket would be compensated more than just the ticket price to reflect the true cost of attending. New clause 20 would restrict the cost to twice the price paid for the ticket, which might not be the full cost to those attending, but would at least give some incentive to those selling to get the ticket price right, without being an open cheque book.

We have come a long way since I first supported the private Member’s Bill of the hon. Member for Washington and Sunderland West (Mrs Hodgson) a few years ago. Then, there was little support for measures to protect consumers from the worst aspects of ticket touting. Now, I am pleased to say that, with increased knowledge and understanding, there is increased agreement on both sides of the House that something needs to be done. The small measures suggested in new clauses 18 to 21 are a step in the right direction, and I trust that the Minister will address at least some of the issues when she responds later.

[Several hon. Members]

rose—

[Mr Speaker]

Order. By my reckoning, eight hon. Members are seeking to catch my eye. Colleagues will be aware that the moment of interruption is 7 o’clock. They will be able to do the arithmetic for themselves, but if everyone speaks for approximately five minutes and no longer, it should be possible to accommodate everybody.

[Mark Durkan (Foyle) (SDLP)]

It is a pleasure to follow the hon. Member for Hove (Mike Weatherley) who spoke so well in support of the new clauses tabled by the hon. Member for Washington and Sunderland West (Mrs Hodgson). I also wish to associate myself with the clear arguments put forward by the hon. Member for Walthamstow (Stella Creasy) in respect of other amendments in this group.

I wish to speak to new clause 15, in my name and that of the hon. Members for East Lothian (Fiona O’Donnell) and for Batley and Spen (Mike Wood). I raised this issue in Committee, although new clause 15 is not simply a retread of the new clause I tabled there about product recalls, especially of electrical items, and safety. It is a new and improved new clause, with added provisions based on the very fine contribution by the hon. Member for Batley and Spen in an Adjournment debate on 24 March.

When my original new clause was debated in Committee, the hon. Member for East Lothian had to speak to it, as I was in the United States as part of a delegation on the Colombian peace process. I pay tribute to the hon. Lady for speaking so well on the new clause in Committee.

The purpose of the new clause is to try to make good the deficiencies in the product recall system. I am one of those people, probably like many other Members, who laboured under the assumption that there are very clear schemes, strict regimes and tightly managed fine systems for product recalls, particularly for products that can threaten the life and health of families and the fabric of properties. We read about products catching fire and being recalled—washing machines, cookers and so on—but the Electrical Safety Council report “Safer Products, Better Business” shows that most product recalls succeed in recalling only 20% of products, with some recalling only 10%. That means there are a lot of unsafe products in people’s homes, threatening lives and property.

18:15

We are told that the Bill is all about giving consumers rights; that it will give more power to consumers in relation to faults; that they will be more aware that products are unsuitable and more able to return them and get redress. Surely we also need to make good the serious gap between faults that manufacturers and suppliers know about, but consumers do not. New clause 15 would improve recall standards and create direct powers for the Secretary of State to take more responsibility in that regard.

The additional points we have included in the new version of the new clause come from the hon. Member for Batley and Spen, who highlighted existing US federal legislation. The Consumer Product Safety Commission, a federal body, operates mainly under the Consumer Product Safety Act 1972, which was enhanced by the Consumer Product Safety Improvement Act 2008. It takes federal responsibility for recall measures and is able to ensure that the considerable gaps in suppliers’ and manufacturers’ customer records are made good. It has become a federal responsibility to ensure that records are kept of who has bought products and where they have gone.

The Government seem to be relying on the industry for that. That is what I took from an answer the Minister gave me in January. She said that there is no problem because the industry has not told her that there is one, but it currently relies on its records of ownership, and they depend on whether people return their warranty and registration cards when they buy products. A lot of people do not because they think they will receive a great deal of marketing bumph and other material they do not want, but doing so is vital if a product recall is required. What we are left with are general media information recalls and signage, which people may not see or take in, being put up in various stores. That is why our recalls do not have a very high success rate, and that is leaving people at risk.

[Mr Speaker]

Order. The hon. Gentleman is addressing the House with inimitable eloquence as always, but I think I can confidently predict that he is reaching his peroration.

[Mark Durkan]

The other point the Government make is that this will be the subject of a European directive in a couple of years’ time. I would only make the point that we should not have to wait for a European directive, and that it would be better if a meaningful European directive were transposed through existing legislation. New clause 15 would provide exactly those powers and that legislation.

[Mrs Main]

I would like to speak to new clauses 13 and 22, and make a small reference to new clauses 18 to 21.

New clause 13 was explained so eloquently by my hon. Friend the Member for Shipley (Philip Davies) as being a matter of consumer choice. I have a huge degree of sympathy with that, but I will explain why I cannot support him today. We should all know exactly what we are eating. We should have a good deal of information about how animals have lived and died. I have major concerns that Europe does not have the same high standards of animal welfare that we have in this country, yet we import meat from those animals that have been raised with living standards we do not find acceptable and have outlawed, such as farrowing pens for pigs.

Briefing from the Eurogroup for Animals, published in 2011, gives some interesting information about European standards of animal husbandry and, indeed, animal slaughter—much of the meat involved enters our own food chain—and makes it clear that many of us should be very concerned about those issues. That organisation opposes the slaughter of all animals without their being stunned beforehand. The briefing states:

“In 2010, the European Commission requested from Member States official data regarding numbers of animals ritually slaughtered within their territory.”

Unfortunately, there was a real lack of data. According to the briefing,

“most of the countries do not have reliable figures available as no traceability exists to differentiate between animals”

when it comes to how they have been slaughtered. Of course, I am concerned about how they have lived as well. There is also a significant over-slaughtering of animals for halal and kosher meat within the food chain to allow for the amount of demand that might arise in countries that import such meat, which means that there is no way of showing what happens to animals that have been killed in that way and where they end up in the food chain.

This is indeed a labelling issue, but I must say to my hon. Friend the Member for Shipley that, according to some of the information that has been gleaned through the examination of people who do not wish animals to be killed without being stunned, it is almost impossible to trace the meat involved, and that without Europe-wide traceability, his proposal will be totally unenforceable. I appreciate that many consumers would like to know how the animals were treated, where and in what conditions they were raised, the extent of the confinement in which they were placed, and how they were slaughtered. While I agree with my hon. Friend’s sentiments—I, too, believe that consumers should know exactly what they are purchasing—I therefore cannot support his new clause.

Let me now say something about the tenancy issues that have been raised. I quote my hon. Friend the Member for Shipley a great deal, because he talks a lot of good sense, and his heart is often in the right place. However, I believe that if we put all the onus on landlords when it comes to any fees associated with the checking of tenants—they often have to be checked now because of the rules on residency, which govern whether they have the right to rent in this country—those fees will go into the chain, and other ways will be found to put up rents. I cannot believe that the Labour party wants that to happen.

A small letting agency in St Albans, which contacted me about the Labour party’s proposal, is deeply unhappy about it. Given that the agency provides a service enabling people to go into its office, choose from the properties that are advertised, be shown round and so on, why should a fee not be incurred for the benefit that the potential tenant enjoys? The landlord may enjoy a different benefit in the form of the checking of the tenants; the benefits are not always exactly the same.

I suggest that the Government should be extremely cautious before accepting any blandishments from the Labour party, which constantly tries to impose all the cost on businesses. We, as consumers, also want a degree of protection.

[Emma Reynolds (Wolverhampton North East) (Lab)]

rose—

[Mrs Main]

I am afraid that this is a very short debate.

Part of those fees go towards ensuring that there is a market for people who want a good choice of tenanted properties that they can go and look at.

Let me now add my few words to the extensive debate about tickets. The hon. Member for Washington and Sunderland West (Mrs Hodgson) made a very good point about touts who would potentially sell tickets back. That is a flaw, but I have a huge amount of sympathy with those who have bought a ticket that cannot be used for some reason. I do not see how it can be wrong to sell that ticket on, as I might sell on anything else that I might have purchased. My hon. Friend the Member for Shipley made the valid point that if a major company selling tickets en bloc wants to try to stop the practice, it should be working with the Government for that purpose.

I do not wish us to outlaw the selling on of tickets that people may have purchased quite rightfully and of which they then wish to dispose. I feel that that would creep into other areas and start applying to people who buy the latest thing from Kate Moss At Topshop, the latest pair of trainers or the latest toy, and then choose to sell it on. I think that that is a slippery slope, and I do not wish to go down it.

[Several hon. Members]

rose—

[Mr Speaker]

Order. Of course I am in colleagues’ hands, but I simply point out that anyone who speaks for longer than three minutes will knowingly be stopping another colleague contributing. I just put that in my usual gentle fashion.

[Mr Clive Betts (Sheffield South East) (Lab)]

I want to speak to new clause 22 about letting agents’ charges. When the Communities and Local Government Committee did a report on the private rented sector last year, we had more evidence and more complaints about letting agents’ charges than almost anything else. That was reflected by the OFT, which said that complaints to Consumer Direct about letting agents were almost all about fees and charges. It is not just that there is one fee up front for a tenancy agreement; there are also the charges for inventories and for credit checks, and people enter into a viewing not knowing what the ultimate charge will be. It is a charge they have to find up front as a prospective tenant, at the same time as they are trying to find the deposit, and often these are people on very low incomes.

The process gets repeated to a degree every time people renew their tenancy after six months or 12 months, and that militates against having longer term contracts. Agents see this as an incentive not to let longer term contracts because short-term contracts mean renewals and more fees for them. I have described letting agents as being a bit like football agents as they make their money out of transfers and renewals of contracts. We ought to be extremely wary of that.

Shelter said the average size of a fee to a tenant was £355. The Foxtons website gives its fees as £420 to a tenant to create a contract, £96 to renew it and £150 for an inventory check. Such charges are replicated by most letting agents.

The Committee responded that there should be absolute transparency of fees up front when a property is advertised and it must be clear what the totality of charges to tenants will be and there should be no double charging. If there is transparency, it will be harder for a letting agent to charge a tenant and a landlord for the same thing, which happens at present.

We want these changes to be put in a mandatory code of practice, but the Government have not agreed to do that. On transparency, all that has happened is the Advertising Standards Authority has given a ruling saying the fees that are compulsory should be shown up front as part of the price quoted. However, when we go on websites like that of Foxtons, we see those fees are in very small print, so, in practice, letting agents are going through the motions when it comes to the ASA ruling, but they are not sticking to the spirit of it.

We did not recommend a complete abolition of fees to tenants. What we said was that it has been done in Scotland and that we should review the Scottish experience. The Committee will come back in the autumn and look at the Scottish experience and consider whether banning charges to tenants means higher rents. If so, there is a question as to whether tenants favour paying a bit more in rent rather than having a massive fee up front. The Committee will also look at the fact that the contract is with the landlord, not the tenant. We will take further evidence on those matters in the autumn.

[Stephen McPartland (Stevenage) (Con)]

I wish to speak briefly to new clauses 18 to 21. I was a member of the Public Bill Committee and we had a long debate about ticket touts and the secondary ticketing market. I think there is cross-party support on this, and I pay tribute to my hon. Friend the Member for Hove (Mike Weatherley) and the hon. Member for Washington and Sunderland West (Mrs Hodgson) for the work they have done as chairs of the all-party group on ticket abuse of which I am proud to be a member. The report that has been produced is excellent and is close to my heart as Knebworth, which is in my constituency, is the largest outdoor music venue in the UK. I am therefore very keen to ensure that we eradicate ticket touting for all events. Having cross-party support to eradicate ticket touting is very welcome, and we need to push that forward.

In Committee I referred to an organisation called Twickets. It takes a photograph of the ticket in question and places it on its Twitter feed and it can then sell that ticket for the face value or less. That is the only way in which that ticket can be sold. That provides a good opportunity for someone to sell a ticket at face value or less to a third party whom they do not know.

One thing that disturbed me in Committee, and one of the reasons why I cannot add my name to new clauses 18 to 21, is that botnets are buying up huge amounts of tickets from the online retailers, and 90% of tickets in the UK are currently sold online. So one huge problem facing us is how to stop these botnets buying up the tickets. Consumer behaviour is in many ways driving the problem, because consumers are prepared to pay almost any price and so they accept the market; they pay the price and that allows ticket touts to flourish. We need to focus on how we can remove ticket touts from the UK and how we eradicate them as much as we can.

18:30

Many people feel that because they are buying a ticket online they are not engaging in behaviour that is associated with a criminal activity, but few of the people who would buy a ticket online would speak to a ticket tout in the street outside a venue and buy a ticket off them. Therefore, part of this may be about educating people so that they understand that when they are buying these tickets online, they are helping some people who are often engaged in criminal activity and they are also working with a group of organisations that are not putting money back into the film and music industries. I am not able to support these new clauses. Although I agree with the spirit of them, I do not feel they would do enough to eradicate the scourge of ticket touts.

[Chris Williamson (Derby North) (Lab)]

I rise to support new clause 22 which is an important first step in addressing a private rented sector into which many hundreds of thousands of people who would previously perhaps have been allocated a social housing dwelling have been forced because council houses and housing association properties are currently in short supply. Many of them have to move over and over again: often these are people on very low incomes and they are hit with punitive charges by profiteering rogue letting agents. I say that this is an important first step because it is not just about the charges associated with establishing a tenancy in the first instance.

A letting agency in Derby, Professional Properties, hits people not only with the sorts of charges we are debating, which would be covered by the new clause, but with additional spurious charges when they end their tenancy. I am dealing with one case in particular where a young woman who looked after the property in which she had been living very well was hit with an enormous charge of more than £1,000 for spurious repairs. As a result of my intervention that charge was dropped, but there has been a refusal to allow her to have her deposit back. Those are shameful tactics by letting agents who are exploiting a very vulnerable group in society, and it is incumbent on us in this place to stand up for people who are being exploited in this way.

It is important to acknowledge that the private rented sector does have a role to play, but we want a responsible private rented sector and a responsible letting agents sector. Rents in the private sector have gone through the roof, so there is ample money in this system without these additional charges being heaped on people, who, as I have said, are often on very low incomes. I strongly support new clause 22 as a very important first step to regularising the private rented sector in our country.

[Andrew Percy]

I want to speak primarily to new clause 22, but first let me briefly speak in support of new clause 14. I thought I was the only person who had problems with switching, believing it to be another in the long list of failures in my life, but since I got elected I have realised that there is a massive issue to address so I fully support that provision. I have some sympathy with new clause 13, as I would like to see better labelling, but I am not sure I can support it as drafted.

On new clause 22, I should declare that I do not have any buy-to-let properties—I struggled enough to qualify for one mortgage, so the idea of qualifying for a further mortgage is probably a bit of a joke. Going through the list of other Members who have relevant interests, I noted that an awful lot of them were on the Opposition Benches. I assume that no Labour Members who rent out a property do so through a letting agent that charges fees, because to do so would be to fall foul of a word we are not allowed to say in here.

With this new clause we have a campaign going on. We have student union politics at the moment whereby the Opposition pick an issue and throw it out there in the hope it gets some traction. They do not think it through; there is nothing more to it than that. This time the issue is letting agent fees. It is my belief that they have not spoken to the letting agents or to many of the tenants who have to pay the fees—if they had, they would not be proposing this measure in such a way. I want a sensible debate on this, but we do not get it. As I have said, what we have had is an orchestrated campaign in which Labour opponents, many of whom live in massive houses in particular constituencies, have been told by the Labour party centrally here in London to parrot a particular line. They do not care about it to the extent that they have ever stood up and talked about it before. My Labour opponent, who wrote to me about this, certainly never had a word to say about it before she was told to do so by Labour headquarters in London. That is what is going on here. We are not having a sensible debate about this measure, which hits some of the big cities such as London, or about repeat fees. Labour has taken this scattergun approach in the hope of trying to drum up support for the measure, but what will happen is that rents will go up, because these charges will not disappear; the tenant will have to pay them in some way.

In many houses in my constituency, particularly in Goole which is relatively poor, the landlords do not charge bonds. They say is that if they cannot charge a relatively small fee—the biggest company in my constituency, Goole Property Centre, does not charge repeat fees or fees to people who do not then get a property—they will charge bonds instead. The cost of getting into a property to begin with could double or quadruple in my constituency.

I can tell Members what some of the letting agencies use their fees for. A large number of those who are renting are foreign tenants, and the agencies try to provide somebody who speaks their language and who gives them additional support, often getting them signed up to gas and electricity. They also help out with some of the simple things, which lead to a huge number of letters in my postbag. I am talking about things like bin collections—how to follow the rules—and community cohesion problems, which occur when large numbers of foreign migrants live in homes in multiple occupation. Landlords use their letting fees to subsidise such activity, and that is what will disappear. This is an ill-thought out policy from the Labour party. Let us have a sensible debate about it. The hon. Member for Sheffield South East (Mr Betts) said that it was too early to make a decision, because we need to see what happens with the trial in Scotland. Unfortunately, Labour has decided not to wait, but wants to continue with a student union type approach to try to build something around the cost of living issue. It is a bit pathetic in my view, which is why I will not support this measure until we have a proper and sensible debate.

[Yasmin Qureshi]

I am concerned about the way in which this debate on halal and kosher has been taking place in the country and about some of the things that have been said in the Chamber. At the heart of this debate is a suggestion that somehow the halal and kosher slaughtering processes are more painful for the animal than the stunning process. Some 90% of the meat in this country is stunned, so we are talking about just 10% of meat. I am sure that Members can see behind what the hon. Member for Shipley (Philip Davies) is saying. He claims that the whole country is concerned about the issue. As somebody who is virtually a vegetarian, but occasionally will eat meat, I am concerned not just about the rights of animals but about the issue of experimentation on animals, which I speak up about and campaign against. The newspaper that is going on about halal meat does not talk about experimentation on animals, which is real cruelty. We know that it just wants to have a go at one particular group of people. I want to deal with one central question, which seems to be the accepted wisdom of everyone here, and that is whether the kosher and halal method of slaughtering is more painful.

A scientific study was carried out by Professor Schultz and his colleague at Hanover university in Germany. They took one group of animals and followed the halal and kosher slaughtering process, and then took another group and followed the stunning process. They placed electrodes on the animals concerned and monitored the level of pain experienced by the animals. If anyone is squeamish here, they can place their hands over their ears. This is what they said about the halal method:

“The first three seconds from the time of Islamic slaughter as recorded on the EEG did not show any change from the graph before slaughter, thus indicating that the animal did not feel any pain during or immediately after the incision…For the following 3 seconds, the EEG recorded a condition of deep sleep—unconsciousness. This is due to the large quantity of blood gushing out from the body…After the above-mentioned 6 seconds, the EEG recorded zero level, showing no feeling of pain at all…As the brain message…dropped to zero level, the heart was still pounding and the body convulsing”—

at this point, the Royal Society for the Prevention of Cruelty to Animals and other organisations might say that the animal is suffering, because it is convulsing, but the reason for that is not pain, but that the blood is leaving the body and the bones in the body structure are convulsing. That is not pain—[Interruption.] I wish hon. Members would listen.

With the stunning method, although the animal appeared to fall unconscious after the stunning, in fact the EEG graph

“showed severe pain immediately after stunning”.

Let us be realistic about stunning. It is not a nice little prick; it is done via an electric shock or sometimes, with some animals, a pistol. We are not talking about a painless death.

[Mr Philip Hollobone (Kettering) (Con)]

Will the hon. Lady give way?

[Yasmin Qureshi]

No, I will not, because I only have a few minutes.

The third thing to notice is that the

“hearts of animals stunned by C.B.P. stopped beating earlier as compared to those of the animals slaughtered according to the”

halal meat method. No one wants to talk about the science, because the accepted wisdom goes with the prejudice that I am sorry to say certain newspapers in this country show towards certain groups without looking at the evidence.

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

Will the hon. Lady give way?

[Yasmin Qureshi]

No; as I said, I am not going to give way.

I am very concerned about how animals are treated and reared and concerned that they should not be treated cruelly when they are transported. We should have a proper scientific debate about slaughtering, because the evidence is out there. Concern is perpetuated because most people do not know how the halal or kosher methods of slaughter take place. If they looked into the studies that have been done in America—I do not have the time to go into all of them—they would find that this is a proper system with the animal’s level of pain being monitored—[Interruption.] I know that Government Members do not want to hear this, but I am sorry: they are going to have to listen to me. I have the Floor, and I am not—[Interruption.]

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order. The House must listen to the hon. Lady.

[Yasmin Qureshi]

Thank you, Madam Deputy Speaker.

I am probably saying something that a lot of people are finding a bit difficult to swallow, but it is about time that the counter-argument and the full facts were presented to the country and to Parliament. For far too long, the debate has been skewed, because certain sections of the media want to deal with just one aspect, but they are misleading people. A myth is being perpetuated that somehow kosher and halal methods, carried out as they should be, are more painful and cause more suffering to the animal, but that is incorrect. The stunning method is probably more painful, so banning things or labelling based on “humaneness” or whether animals are being treated properly is wrong. I want to say more, but I will leave it at that, because others want to speak.

[Julian Sturdy (York Outer) (Con)]

I will not detain the House for long. I want to talk about new clause 13. I was hoping that my hon. Friend the Member for Shipley (Philip Davies) would not divide the House on it, but it has highlighted yet again the extremely important issue of food labelling and consumer choice, and the work that still has to be done.

I start with a simple principle and question. Should consumers be allowed to know where their food has come from, how it has been prepared and how it has been slaughtered? For me, the answer to that simple question is yes so that consumers can make an informed choice. However, I accept that the issue is more complicated than that and more complex than this simple new clause. I am not being critical of my hon. Friend when I say that, and I completely understand why he has worded it as he has. However, although I have great sympathy with new clause 13, I cannot support it as it stands.

18:45

In essence, the stunning of livestock has been mandatory in the EU since 1979, although member states can grant exemptions for religious slaughter. Some people in this Chamber might want to follow the lead of Denmark and ban non-stunned slaughter altogether on animal welfare grounds, but I for one would certainly not want to go down that road. As my hon. Friend has said, the proposal is not about banning anything, nor should it be. I strongly believe that consumers should have the right to make an informed choice, and the new clause should serve as a warning shot across the bows of Government that the issue will not go away.

The Government are going to have to grasp the nettle at some point and for me that point needs to come sooner rather than later. I look forward to hearing what the Minister has to say.

[Jenny Willott]

We have had a varied and wide-ranging debate this afternoon, so I shall do my best to cover as many of the issues that Members have raised as I can. First, however, I want to explain the Government amendments, which are designed to protect consumers from a delay in receiving a refund. We discussed the issue in Committee and although delay might arise only in a minority of cases, the Government are persuaded that the potential detriment means that this is a sensible change to make. We are ensuring that any refund must be made without undue delay and always within 14 days of the trader agreeing that the consumer is entitled to a refund. Since we discussed that in Committee my Department has been consulting business organisations and consumer groups to identify the best way to make the change without disadvantaging either consumers or businesses. I am glad that the Opposition support the change.

The Government agree that consumers should be protected from fraudulent, counterfeit and misleading ticket sales. I think that everybody in the House would agree with that. However, we also need to allow the market to operate for the benefit of consumers who would miss out on events without it. We have made new regulations that will come into force this year to empower and inform consumers. From June, traders will have to ensure that consumers have all the information they need before they buy. We published detailed guidance when the regulations were made in December 2013, but since then the Trading Standards Institute has been working on additional guidance. We have today updated our guidance on those regulations to make it clear what that means for ticket sales. That went live on our website this morning. It includes clarification that if the ticket is for a specific seat that information must be given, that the total cost, including delivery costs and other charges, must be given and that, depending on the circumstances, the face value may also need to be given.

In addition, from October of this year we are making it easier for consumers who have been misled by a trader to take their own action to get their money back and, if appropriate, to get damages as well. Armed with that information and access to redress, consumers will be empowered to make use of the market for their benefit and hopefully not fall victim to fraudulent, counterfeit or misleading ticket sales. There are also rules in place to protect consumers, and when a marketplace is aware of illegitimate activity on its site it might be in breach of the Consumer Protection from Unfair Trading Regulations 2008.

As for new clause 12, when there are concerns about the secondary ticketing market the first port of call should be for the industry to source a solution. Some of the larger event organisers, as has already been mentioned, already have refund procedures in place and we welcome that. However others, including smaller players, have chosen not to, for very good commercial reasons in many cases.

The hon. Member for Shipley (Philip Davies) highlighted the importance of industry-led action, and we agree with that. The hon. Member for Walthamstow (Stella Creasy) and a number of other Members mentioned the rugby world cup in 2015, and that is a great example of industry-led action. The organisers’ 10-point plan lists many of the actions suggested by the hon. Member for Shipley, including the release of tickets in batches and the late issue of tickets.

All that is being industry-led. I hope that what I have said has reassured members of the all-party group that we share the concerns that they have highlighted and that we have looked carefully at the best way to take on board the group’s recommendations to try to protect consumers. I hope that they are reassured by what I have explained about the information on the website and in the guidance.

On halal meat—a completely different subject—we want people to have the information that they need to make informed choices about the food that they buy. Many retailers or restaurants and fast food outlets already voluntarily provide information on whether meat is halal or kosher. As we have seen from the debate today, this is a complex and sensitive area. There is no single clear definition of halal meat. The majority of halal meat produced in this country comes from animals that are stunned before slaughter, whereas kosher meat all comes from unstunned animals. That is just part of what consumers want to know, as we have heard in the debate today. We already have powers under the Food Safety Act 1990 to make domestic regulations to introduce a requirement to label with the method of slaughter. However, we do not consider at this stage that regulation is the best approach. Primarily, food businesses should provide consumers with the information that they want and need. If there is to be compulsory labelling, we believe that this would best be done at a European level. That would be best for consumers and also ensure that we do not put our food industry at a competitive disadvantage.

[Philip Davies]

Will the Minister give way?

[Jenny Willott]

I will not give way, I am afraid. I have no time.

My hon. Friend the Member for Shipley said that there was widespread customer demand for labelling of the kind that has been suggested. An EU study is currently being undertaken on precisely that question, so we are waiting with interest the publication of the study so that we have full information on what consumers want. We will review all our options at that point.

We had a good debate about product safety in Committee and we have discussed it recently in the Chamber. There is already legislation on product safety recalls, which places strict duties on producers and distributors to ensure the safety of products. These regulations also provide trading standards with comprehensive powers to enforce them. As the hon. Member for Foyle (Mark Durkan) said, we need to improve the effectiveness of product recalls. The traceability of products after sale is a real challenge, as he said, but I do not believe that introducing new reporting requirements or a new overarching agency is the right approach. The vast majority of businesses take the safety of their customers very seriously and I believe that the best approach is therefore for us to continue to work with representatives from industry, consumer groups and enforcement agencies to ensure that the system is as effective as possible.

The issue of lettings has also excited people this afternoon. Most letting agents offer a good service. A blanket ban on fees, as new clause 22 proposes, cannot therefore be the answer to tackle a minority of irresponsible agents. In addition, banning fees will not make it cheaper for tenants, because tenants will just end up paying through higher rents rather than upfront fees. The hon. Member for Walthamstow highlighted the example of Scotland. My understanding is that in the first quarter after the change was introduced rents rose significantly in Edinburgh and Aberdeen, and in the year to March rents rose by more in Scotland than in England and in Wales. In fact, the rate of increase in rents was double that in Wales. So it is not quite as simple a picture as the hon. Lady highlighted.

We are already changing the law to require all letting and managing agents to belong to an approved redress scheme, which will give tenants an effective way to make complaints. Last month the Housing Minister approved three redress schemes that all letting and property management agents will be required to join later this year. This will ensure that tenants and leaseholders have a straightforward way of holding their agents to account. The three compulsory schemes, which are the property ombudsman, ombudsman services: property and the property redress scheme, will offer independent investigation of complaints about hidden fees or poor service. Where a complaint is upheld, tenants and leaseholders could get compensation.

We are going further. Today, in a move that ensures a fair deal for landlords and tenants, I am pleased to announce that we will be amending the Bill to require letting agents to publish full details of the fees that they charge. Currently the Advertising Standards Authority requires letting agents only to list charges to the tenant up front in their advertisements. Those letting agents who are found to have imposed hidden charges face little more than being named and shamed on the authority’s website. We want to go further to require all letting agents to publish a full tariff of their fees both on their website and prominently in their offices. Anyone who does not comply with those new rules will face a fine that is a much stricter penalty than currently exists. While every business remains free to set its own fees it has to be transparent, so competition will ensure that letting agents will have to justify those fees to tenants.

Today’s plans add to the work that the Government have already done to offer stronger protections for landlords and tenants in the private rented sector while avoiding excessive regulation, which would force up rents and reduce choice. We intend to review the requirement for greater transparency after 12 months of operation to confirm that it is delivering the expected benefits. If not, the Government will consider whether the proposals need to go further.

We have discussed micro-businesses in an earlier debate, so I will briefly state that we do not support extending the consumer protections in the Bill to smaller businesses. The provisions in the Bill have been designed for consumers, and we cannot and should not assume that they can be applied as successfully to small businesses as they can to consumers. As the Select Committee on Business, Innovation and Skills acknowledged, all business groups that responded to the Government’s 2008 consultation preferred to retain the clarity of the current distinction between business and consumer.

Finally, on Government amendment 14 and Opposition amendment 5, I am happy to change the process from a requirement for the negative to the affirmative procedure, and have tabled a Government amendment to that effect. I therefore hope that the hon. Member for Walthamstow will not press her amendment.

[Philip Davies]

I did not hear the Minister make any remarks about new clause 14, which appeared to have cross-party support. Will the Government support it too?

[Jenny Willott]

Given the time restrictions, I shall say that we support the intention behind the new clause but not its wording, as there are a number of problems with it. I am happy to discuss with the hon. Gentleman after the debate the points that he has made to see if there is a way forward. With those remarks, I hope that hon. Members are happy that I have covered all the issues that were raised in the debate.

[Stella Creasy]

A number of issues have been raised. I am conscious of the time so I shall be brief and discuss the two new clauses that we want to push to a vote because we are not satisfied with what the Government have said. First, on new clause 22, which deals with letting fees, the Government should realise that it is not a small minority of letting agents charging fees. Indeed, good landlords do not want to lose tenants who cannot afford those fees.

The hon. Member for St Albans (Mrs Main) was disrespectful about the idea that tweeting in the Chamber was a good idea. Let me tell her that in the past hour we have had an example of a fee of £1,300 to change the names of two tenants on a tenancy agreement. Those are the sorts of fees that we are talking about. Shelter disputes the evidence that the Minister gave about there being no impact on rent inflation in Scotland since the measure was introduced. Members have to make a decision about whether they are on the side of the consumer or on the side of business. We are firmly of the view that we need to be on the side of the consumer in this instance in changing the way in which the rental market works. Rental fees are anti-competitive, and there is a conflict between who acts for the landlord and who acts for the agent. We need to change that, so we want to push new clause 22 to a vote.

We also want to push new clause 16 to a vote, because it is clear that Members across the House want to see action on ticket touting. New clause 16 puts into practice the amendments that the Government proposed on consumer information and consumer evidence. The Minister discussed the rugby world cup, but it is clear that tickets are already being sold on secondary sites, so the measures that she discussed have not had an impact. We need to make progress on that too.

We are happy to take advice on amendments on businesses, and we are happy to accept the Minister’s assurances about refunds. We are seeking more Government U-turns, but on letting agent fees and ticket touting it is time for action, and that is exactly what the Opposition seek in the amendments. I beg to ask leave to withdraw the motion.

Clause, by leave, withdrawn.

New Clause 13

Goods to be as described: meat products

‘(1) All products containing halal and kosher meat shall be labelled as such at the point of sale by retail and food outlets.

(2) A food outlet is anywhere where food is served to the public.’.—(Philip Davies.)

Brought up, and read the First time.

Question put, That the clause be read a Second time.

18:59

Division 277

Ayes: 17

---

Conservative: 12
Labour: 2
Democratic Unionist Party: 2
Independent: 1

Noes: 281

---

Conservative: 237
Liberal Democrat: 42
Labour: 1

19:13

Proceedings interrupted (Programme Order, this day).

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

New Clause 16

Secondary ticketing platforms: product and seller information

‘(1) The Secretary of State shall issue guidance to all traders who operate as secondary ticketing platforms on the application of the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013.

(2) Guidance issued under section (1) shall include how secondary ticketing platforms must inform consumers of—

(a) the chosen identity of the seller;

(b) the country of residence of the seller;

(c) information provided by previous buyers on the reliability of the seller and the tickets he has sold;

(d) information on any complaints made against the seller for failing to supply tickets;

(e) information on any complaints made against the seller for supplying fraudulent or invalidated tickets; and

(f) information on all other accounts currently or previously held with the secondary ticketing platform linked to the seller by virtue of personal, financial and contact information provided by them.

(3) Guidance issued under section (1) shall set out how information required under Part 2 of the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 shall be—

(a) accurate; and

(b) prominently displayed before a buyer is able to purchase.

(4) Guidance issued under section (1) shall set out how secondary ticketing platforms must disclose clearly if the seller of the ticket is—

(a) the secondary ticketing platform themselves;

(b) individuals employed by the secondary ticketing platform;

(c) other companies linked to employees, directors or shareholders of the secondary ticketing platform;

(d) the event organiser or an agent acting on their behalf; or

(e) any other party connected to the event organiser of the event.

(5) Guidance issued under section (1) shall set out the status of tickets as unique goods with distinct characteristics which would affect—

(a) the enjoyment of the good by the consumer;

(b) the use of the good by the consumer; or

(c) the inherent value of the good in questions.

(6) Where a ticket is sold through a secondary ticketing platform, guidance issued under section (1) shall set out how the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 apply to tickets as unique goods, including—

(a) how sellers must provide all relevant information about the ticket including but not limited to the face value of the ticket and a designated seat or ticket number;

(b) how secondary ticketing platforms will publish all the information about a ticket provided by the seller in a prominent and clear way; and

(c) what sanctions will apply for failing to provide this information under the regulations.’.—(Stella Creasy.)

Brought up, and read the First time.

Question put, That the clause be added to the Bill.

19:13

Division 278

Ayes: 229

---

Labour: 216
Scottish National Party: 5
Plaid Cymru: 3
Social Democratic & Labour Party: 1
Independent: 1
Alliance: 1
Green Party: 1
Democratic Unionist Party: 1

Noes: 290

---

Conservative: 246
Liberal Democrat: 43
Democratic Unionist Party: 1

New Clause 22

Prohibition of fees in contracts for services: letting of residential accommodation

‘(1) The provisions in this section apply to a contract for a trader to supply a service in connection with the letting of a residential premises.

(2) Subject to the provisions of this section, any person who demands or accepts payment of any sum of money from a person (“P”) for services in connection with a contract for the letting of residential premises shall be guilty of an offence.

(3) For the purposes of subsection (2), P is any person—

(a) who seeks to enter a contract to let residential accommodation, or

(b) who has a tenancy of, or other right or permission to occupy, residential premises.

(4) For the purposes of subsection (2)—

“letting” shall include any service provided in connection with the advertisement or marketing of residential accommodation or with the grant or renewal of a tenancy;

“services shall —

(a) include, and are not limited to—

(i) the registration of persons seeking accommodation,

(ii) the selection of prospective occupiers, and

(iii) any work associated with the production or completion of written agreements or other relevant documents.

(b) not include credit checks of person seeking accommodation.

(5) Where a person unlawfully demands or accepts payment under this section in the course of his employment, the employer or principal of that person shall also be guilty of an offence.

(6) A person shall not be guilty of an offence under this section by reason of his demanding or accepting payment of rent or a tenancy deposit within the meaning of section 212(8) of the Housing Act 2004.

(7) A person shall not be guilty of an offence under this section by reason of his demanding or accepting a holding deposit.

(8) A “holding deposit” for the purposes of subsection (7) is—

(a) a sum of money demanded of or accepted from a person, in good faith for the purpose of giving priority to that person in relation to the letting of a specific property, which is to be credited towards the tenancy deposit or rent upon the grant of the tenancy of that property, and

(b) not greater than two weeks rent for the accommodation in question.

(9) Costs incurred by persons seeking accommodation for the undertaking of credit checks shall be reimbursed upon the signing of a tenancy agreement.

(10) In this section, any reference to the grant or renewal of a tenancy shall include the grant or renewal or continuance of a lease or licence of, or other right or permission to occupy, residential premises.

(11) In this section “rent” shall include any occupation charge under a licence.’.—(Stella Creasy.)

Brought up.

Question put, That the clause be added to the Bill.

19:26

Division 279

Ayes: 228

---

Labour: 216
Plaid Cymru: 3
Liberal Democrat: 2
Democratic Unionist Party: 2
Social Democratic & Labour Party: 1
Independent: 1
Conservative: 1
Alliance: 1
Green Party: 1

Noes: 281

---

Conservative: 243
Liberal Democrat: 38

Clause 20

Right to reject

Amendment made: 9, page 11, line 39, at end insert—

‘(13A) A refund under this section must be given without undue delay, and in any event within 14 days beginning with the day on which the trader agrees that the consumer is entitled to a refund.

(13B) If the consumer paid money under the contract, the trader must give the refund using the same means of payment as the consumer used, unless the consumer expressly agrees otherwise.

(13C) The trader must not impose any fee on the consumer in respect of the refund.’.—(Jenny Willott.)

This amendment and amendments 10, 11, 12 and 15 require a trader to provide any refund due to the consumer without undue delay and at the latest within 14 days. They also provide that the refund must be in the same form as the original payment unless the consumer agrees otherwise and that no fee may be charged.

Clause 24

Right to price reduction or final right to reject

Amendment made: 10, page 14, line 42, leave out ‘(11)’ and insert ‘(13C)’.—(Jenny Willott.)

The explanatory statement for amendment 9 also applies to this amendment.

Clause 44

Right to price reduction

Amendment made: 11, page 27, line 45, at end insert—

‘(4) A refund under this section must be given without undue delay, and in any event within 14 days beginning with the day on which the trader agrees that the consumer is entitled to a refund.

(5) The trader must give the refund using the same means of payment as the consumer used to pay for the digital content, unless the consumer expressly agrees otherwise.

(6) The trader must not impose any fee on the consumer in respect of the refund.’.—(Jenny Willott.)

The explanatory statement for amendment 9 also applies to this amendment.

Clause 45

Right to a refund

Amendment made: 12, page 28, line 8, at end insert—

‘(3) A refund must be given without undue delay, and in any event within 14 days beginning with the day on which the trader agrees that the consumer is entitled to a refund.

(4) The trader must give the refund using the same means of payment as the consumer used to pay for the digital content, unless the consumer expressly agrees otherwise.

(5) The trader must not impose any fee on the consumer in respect of the refund.’.—(Jenny Willott.)

The explanatory statement for amendment 9 also applies to this amendment.

Clause 46

Remedy for damage to device or to other digital content

Amendment made: 13, page 28, line 31, at end insert—

‘(4A) A compensation payment under this section must be made without undue delay, and in any event within 14 days beginning with the day on which the trader agrees that the consumer is entitled to the payment.

(4B) The trader must not impose any fee on the consumer in respect of the payment.’.—(Jenny Willott.)

This amendment requires that compensation for damage caused by digital content to other digital content or hardware must be provided by the trader to the consumer without undue delay and at the latest within 14 days. It also provides that no fee can be charged for this payment.

Clause 48

Contracts covered by this Chapter

Amendment made: 14, page 30, line 3, leave out subsection (7) and insert—

‘(7) No order may be made under subsection (5) unless a draft of the statutory instrument containing it has been laid before, and approved by a resolution of, each House of Parliament.’.—(Jenny Willott.)

Clause 48(5) gives the Secretary of State power to remove specified services from the application of Chapter 4 of Part 1 by order made by statutory instrument. This amendment changes the Parliamentary procedure for such statutory instruments from the negative resolution procedure to the affirmative resolution procedure.

Clause 56

Right to price reduction

Amendment made: 15, page 32, line 43, at end insert—

‘(4) A refund under this section must be given without undue delay, and in any event within 14 days beginning with the day on which the trader agrees that the consumer is entitled to a refund.

(5) The trader must give the refund using the same means of payment as the consumer used to pay for the service, unless the consumer expressly agrees otherwise.

(6) The trader must not impose any fee on the consumer in respect of the refund.’.—(Jenny Willott.)

The explanatory statement for amendment 9 also applies to this amendment.

Ordered, That further consideration be now adjourned. (Claire Perry.)

Bill to be further considered tomorrow.

Business without Debate

Tuesday 13th May 2014 Commons Chamber

Business of the house

Motion made, and Question put forthwith (Standing Order No. 15),

That, at this day’s sitting, proceedings on the Motion on All-Party Parliamentary Groups may continue, though opposed, until any hour.—(Claire Perry.)

Question agreed to.

Deferred Divisions

Ordered,

That, at this day’s sitting, Standing Order No. 41A (Deferred divisions) shall not apply to the Motion in the name of Kevin Barron relating to All-Party Parliamentary Groups.—(Claire Perry.)

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order—that means that every Member in the Chamber, whether in front of or behind the Chair, should be silent.

All-party Parliamentary Groups

Tuesday 13th May 2014 Commons Chamber

19:39

[Kevin Barron (Rother Valley) (Lab)]

I beg to move,

That–

(1) this House approves the Sixth Report of the Committee on Standards, Session 2013-14, HC 357, on All-Party Parliamentary Groups, and the Rules for All-Party Parliamentary Groups contained in Annex 1 of that Report.

(2) the Resolution of the House of 17 December 1985, as amended on 10 March 1989, 29 July 1998, 7 February 2011 and 12 March 2012, relating to the registration of interests be further amended with effect from the beginning of the next Parliament by:

(a) leaving out paragraphs 3 and 4; and

(b) inserting a new paragraph 3:

“Chairs of All-Party Parliamentary Groups shall be responsible for registering the matters specified in the rules for such groups and for the group’s adherence to the Guide to the Rules for All-Party Parliamentary Groups”; and

(3) the Committee on Standards shall have power to update the Guide to the Rules for All-Party Parliamentary Groups from time to time and to make such minor changes to the Rules for All-Party Parliamentary Groups as are necessary to ensure the effective operation of the Register of APPGs and the regulatory regime applying to such groups.

I am delighted that the House is able to debate the report, which sprang out of Mr Speaker’s recognition that all-party group regulation needed to be reconsidered to ensure that it remained appropriate. As I recall, both you in a previous life, Madame Deputy Speaker, and I were members of the working group that was set up. It was chaired by my right hon. Friend the Member for Blackburn (Mr Straw), who unfortunately is unable to be with us tonight, although he would have liked to have been here. The Select Committee on Standards built on the proposals of the Speaker’s working group but we also conducted our own investigation. The lay members of the Committee played a full part in this investigation and their presence meant that we had the power for the first time to see ourselves as others see us. I can assure the House that lay members may be friends but in private they have no hesitation in being critical friends. In my view, their ability to be critical friends is precisely what makes them worth having on the Committee. I am sure that view is shared by all members of the Committee. As a result of their involvement we know that the Committee’s proposals command the support of people who have taken the trouble to inform themselves about the way this place works and the wider issues involved in all-party group regulation.

As part of our work, the Committee joined with the Administration Committee to get some hard facts about the way in which all-party parliamentary groups operate. We surveyed all APPGs to find out the range of support they received and the frequency of their meetings, and besides that quantitative evidence we took qualitative evidence from colleagues from external organisations involved with APPGs, from those who reported on them and from critics as well.

I do not think we should be embarrassed about APPGs. Indeed, I would be surprised if more than a handful of us were not involved in APPG work. APPGs enable groups of Members to inform themselves about policy. They allow us to work across party lines and to work across both Houses. They allow us to educate ourselves. Today’s all-party Whip shows that Members have opportunities to meet with UK ambassadors from many different countries, hear about the launch of the Green Investment Bank’s new scheme to help local authorities install energy-efficient street lighting, look at the links between mental health and problem debt, or hear about immigration detention in the UK from Shami Chakrabarti or social work from Martin Narey—that is only some of the meetings that are taking place today under the all-party group system. There is a great opportunity for Members of this House—for legislators—to hear from experienced people on many issues.

[Robert Flello (Stoke-on-Trent South) (Lab)]

I draw the House’s attention to the various APPGs with which I am closely involved, and other declarations of interest. One APPG today met a group that included over 60 members of the freight industry. Members of the House were able to hear from them, and were informed by a response from Baroness Kramer. That knowledge would not be able to be received in any other way.

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order. Interventions must be brief.

[Kevin Barron]

My hon. Friend’s point is well put. I am no expert on freight but if I wanted to be and I was involved in making legislation in this House, that is the type of opportunity that is available to share experience from outside.

APPGs come in all shapes and sizes, from a few people effectively acting as a friendship group for a particular country to groups such as the parliamentary and scientific committee, which provides a way for parliamentarians and the science community to communicate with one another, often through major events. APPGs provide a forum for parliamentarians to press for change. They also provide a forum in which outside organisations working on the same topic can communicate with one another.

It is true that APPGs provide a forum in which outsiders can promote policy to Members of Parliament. I think it is reasonable for us to listen to those who want to lobby us, whether they are charities, businesses or knowledgeable individuals. Their ideas will only be taken up if we think they are good. This is a Parliament—a place where people talk. We talk to one another in formal proceedings, but, even more, we talk to people outside this place, both formally and informally. We need to do that to do our job, so there should be as few barriers as possible to people talking to MPs. Freedom of association is one of the rights protected by the European convention on human rights. Nobody wants to stop MPs talking to each other or to those outside this place, but we could not stop, even if we were mad enough to want to try. Any regulatory regime has to be proportionate, or all-party groups’ activities will simply be driven underground.

It is fair to say that there is a suspicion about all-party groups and at least a danger that they could be misused, so we need a regime that reduces the chance of such misuse. Before I go into that, I just wish to say that I hope last week’s events in this place made it clear that existing rules already prohibit Members from using all-party groups for personal gain and that the Committee on Standards will have no hesitation in condemning those who seek to misuse them.

Our proposals in this report are based on five principles: ensuring parliamentary control of all-party groups; ensuring responsibility and accountability; financial transparency; improved understanding; and proportionality. On parliamentary control, it is already a requirement that groups should meet to elect officers at Westminster on a sitting day and that the meetings and annual general meetings should be advertised on the all-party notice. We also propose an increase in the quorum; that only parliamentarians should have voting rights in all-party groups; and that all members—MPs and peers—should be entitled to vote in an all-party group.

Our proposals on responsibility and accountability are designed to ensure that groups are regulated from this House and it is clear who is responsible for compliance. Rather than having a contact officer, all-party groups should have a chair from the Commons, who will have responsibility for ensuring that the group complies with the rules. All-party group notices should give a parliamentary e-mail contact—we are working on that at the moment. We recognise that external support can be invaluable, but if these groups are really of interest to Members surely we should be willing to provide some resource to support them. Complaints about all-party groups could be and will be investigated by the Parliamentary Commissioner for Standards.

Members are already responsible for registering benefits they each receive as a result of APPG membership, such as visits or hospitality, and that will remain. We also recommend that APPGs that receive £12,500 per year will need to submit annual income and expenditure statements. Benefits in kind will need to be described and have an approximate financial value ascribed to them. We believe that is a sensible thing to do, but that does not take individual members of all-party groups away from their individual responsibilities to register such matters.

On improving understanding, we want there to be clear APPG branding, accompanied by clearer rules about the informal work Members undertake which is not linked to APPGs. The House has formal Committees and, in APPGs, a mechanism for MPs and peers to work together outside that formal framework. Members are entirely free to work outside those frameworks, but we should not be attaching the logo of Parliament to groups that do not comply with the regulatory requirements. Some offers were made during the debate and with the working group on getting harsher on this, but we genuinely believe that such an approach would drive people away from the formal all-party group structure into an ad hoc system, which would have little, if any, influence. We want to make sure that that is avoided. There also needs to be far better information on APPGs on the parliamentary website. I am pleased to say that the all-party Whip is now at least available on the intranet.

On proportionality, as well as making sure that the financial transparency regime is effective without being onerous, we propose to end the requirement for there to be 20 qualifying members before a group can be set up. In practice, it has meant that colleagues have signed up to groups on the principle that they might some day be interested, or because if they wished to found a group themselves their colleagues would be more likely to support them. I have had an interest in several all-party groups for most of my time in this place, so I know that that is the case. Members trade names. They may say, “Well, you can put me down for that one, as long as you don’t expect me to do any work in that area.” We feel that that behaviour should now end, and there is detailed recommendation about how to do that.

It was impossible to distinguish between groups that attracted a great deal of parliamentary interest and those that were, shall we say, more specialist, and we feel that there should be more transparency in that area. Let me end with a quote from our report. It says:

“No one wants a Parliament where Members have no interaction with wider society, take no steps to inform themselves about matters of public concern or are simply lobby fodder for whichever party they represent. APPGs perform a useful function in allowing Members to set the agenda and in allowing wider groups to put their case to interested parliamentarians within a framework which ensures transparency and control by Parliament.”

I hope that the House will agree to our proposals, which are intended to produce such a framework.

19:51

[The Deputy Leader of the House of Commons (Tom Brake)]

On behalf of the Government, I support the motion before us in the name of the Chair of the Committee on Standards. The right hon. Member for Rother Valley (Kevin Barron) has set out very clearly the conclusions of his Committee’s report and the effect of the motion before the House. All-party parliamentary groups have a distinct and important role to play in the work of Parliament. They provide a recognised forum in which Members of both Houses can meet together and with individuals from outside Parliament to share information and exchange ideas on issues of mutual interest. This is a healthy process. Indeed, the free flow of ideas and information between the lawmakers and citizens is an essential part of any properly functioning democracy.

There is a huge range of APPGs, the origins and purposes of which may range from a shared interest in a particular country or activity to a campaign for a good cause or policy objective. There is no problem with that. What is important—I would say essential—is that in respect of all such groups, there is transparency as to their purpose, membership and support, particularly any financial support, as well as accountability for their actions. That is what I hope will be achieved through the changes we are approving today.

I fully support the intention of the new resolution to make it clear that each chair of an APPG will be responsible and accountable for their group’s adherence to the rules governing all-party parliamentary groups. Those rules must be taken seriously and complied with scrupulously. The fact that significant breaches will be subject to investigation by the Parliamentary Commissioner for Standards and subsequent consideration by the Standards Committee should provide an effective deterrent.

I am also happy to endorse the proposal to give the Committee on Standards the job of updating the guide to the rules on APPGs and making minor changes to the rules from time to time as the need arises without having to bring such changes before the House for approval.

The House can have confidence in the Committee to entrust it with this function. Indeed such detailed changes are much better done in Committee than on the Floor of the House. The House should be grateful to the Standards Committee for its work on revising the rules and the guide to the rules on APPGs. This will serve to increase the confidence of the public in how Parliament conducts itself and the confidence of Members that their engagement with APPGs is not only valuable in itself but beyond reproach. I commend the motion to the House.

19:53

[Thomas Docherty (Dunfermline and West Fife) (Lab)]

The Opposition recognise the importance of this issue, and the debate is particularly timely given the recent scandal involving Mr Patrick Mercer.

I want to begin by thanking the Standards Committee for conducting a thorough investigation into the running of all-party parliamentary groups. In particular, I thank my right hon. Friend the Member for Rother Valley (Kevin Barron) for his continued chairmanship of the Committee and the leadership that he has shown on the issue. I also thank all those Members who provided submissions, and those organisations and individuals who gave evidence to the Committee. The inquiry was, I think, an historic first in that I am not aware of a previous occasion on which a journalist—Mr Mark D'Arcy of the BBC—was asked to give evidence as an expert witness.

It is worth noting the origins of the inquiry. As the Committee report explains in its introduction, there has been disquiet about the increasing number of APPGs in recent years and, in particular, questions about whether they were susceptible to undue external influence. Mr Speaker’s working group on APPGs was established earlier in this Parliament to consider such issues. From the group’s comprehensive study, it was right that the decision was taken for the Standards and Privileges Committee, as it was then constituted, to look at the rules on registration.

In parallel, the Administration Committee, under the chairmanship of the right hon. Member for Saffron Walden (Sir Alan Haselhurst), has at the Commission’s request examined the impact of APPGs on the running of Parliament. The Administration Committee’s key recommendations, such as the scrapping of the APPG passes, reform of the security and room-booking process and the requirement to have a parliamentary contact included in the all-party group Whip, have already been implemented. The House is grateful to Mr Speaker and to the whole Commission for their leadership and the decisive action taken, in particular in the light of the events that transpired last summer.

Returning to the Standards Committee report before us, Labour concurs with all the proposed changes. The recommendations to scrap associate groups and to end non-parliamentarians having a vote in the running of parliamentary groups are correct. The raising of quorums for meetings and increasing the number of officers, while at the same time ending the requirement to have 20 signed-up parliamentarians, is sensible. As the Committee explained, the 20-member rule has led to a number of cases in which MPs and peers who play no active role in an APPG are dragooned into helping out colleagues to meet the targets, as well as obscuring those who are actually playing a key role in the running of an APPG.

Transparency of activities is vital. To that end, we also support the proposed threshold for donations or gifts in kind of greater than £500. The Committee’s logic in recommending the same threshold as for party donations seems to be an appropriate figure. We agree with what my right hon. Friend the Member for Rother Valley said, that requiring those groups that receive more than £12,500 a year to publish income and expenditure statements will go some way towards improving public confidence in APPGs. In short, where the Committee has recommended changes, Labour fully endorses the recommendations and urges the House to support them.

The Patrick Mercer case, however, has again highlighted the unease felt by many both inside and outside the House of Commons about the role that lobbyists and third-party organisations may play in the running of APPGs. In the interest of transparency, it might be appropriate at this point to highlight the fact that the charity for which my wife works provides the secretariat to a cross-party group in the Scottish Parliament. Cross-party groups are the equivalent of APPGs. Nevertheless, I recognise the role that lobbyists, charities and big business may play in providing secretariat and administrative support, which, for some people, has been and is still a contentious issue.

I note that the Standards Committee does not propose any alterations to the APPG rules on external support. As the Committee acknowledged, however, its report was produced without reference to the Patrick Mercer case. That scandal makes uncomfortable reading for all of us who believe that Parliament should be striving to restore public confidence in political participation. The Parliamentary Commissioner for Standards found that Mr Mercer sought to use an APPG as a vehicle for his commercial interests and that the pseudo-foundation that he proposed as the secretariat would be the engine of that vehicle.

Campaigners for greater transparency have long questioned why some organisations provide the secretariats to APPGs. As the Committee acknowledged:

“It would be naive to think that all the organisations supporting APPGs do so…for altruistic reasons”.

Indeed, the Chair of the Select Committee on Political and Constitutional Reform, my hon. Friend the Member for Nottingham North (Mr Allen), warned only last week in the Chamber that

“all-party groups…are the next big scandal waiting to happen”—[Official Report, 8 May 2014; Vol. 580, c. 305.]

It is therefore sensible that the question whether it is acceptable for the secretariat to be provided externally be kept under review. Will the Leader of the House say, therefore, whether the Government share our view on that issue? Will he say whether the Government believe that a fresh, independent look at the issue should be considered in the next Session? Will he clarify whether the Government are relaxed about the question of lobbyists or big business playing a key role in the heart of the parliamentary system?

In conclusion, we believe that the report has much to commend it. It makes a range of important recommendations and also endorses the decisions of the Commission and the Administration Committee in a number of areas of the running of the House of Commons. We thank the Standards Committee for its work and endorse the motion.

20:00

[Sir Paul Beresford (Mole Valley) (Con)]

I declare an interest as the chairman of three APPGs—those on the police, skin and, unsurprisingly, dentistry. I occasionally attend others as well. Following the last attack, if you like, subtle though it was, I must say that I am always amused by the mythology surrounding APPGs. According to the media, in particular, they have mystical power over Ministers. Many, including those who should know better—I include some journalists—relate them to Select Committees. Journalists, when media effect is needed, always describe Select Committees as powerful and APPGs as influential. I am afraid that my response to that is “perhaps”.

The fear propounded by some in the media is that lobbyists will manipulate APPGs. In fact, one of the national papers floated that in an article today. The hon. Member for Dunfermline and West Fife (Thomas Docherty) mentioned Mark D’Arcy, a parliamentary BBC journalist who knows, because he cruises the halls of the House of Commons and, I think, of the House of Lords, exactly how the systems work. The Standards Committee asked him various questions—his answers are in the report—and he said:

“Someone said to me during recent events that if someone was going around touting the idea that All-Party Groups have genuine influence on Government policy, they should be done for fraud”.

He then said that he agreed, but up to a point.

As a former Minister, I was always made very aware of the background of anyone I was officially meeting, whether they were a lobbyist, from an all-party group, or an individual who wished to influence policy. Every Minister will be well briefed on anyone trying to pursue a position or point—whether they are an individual, or from a group, a firm or an APPG. Their points might or might not be accepted by the policy makers, but it is right that APPGs can be one source of information. In fact, the skin APPG recently published a report for the accepted benefit of Department of Health Ministers following a gathering together of interested people, groups, trade representatives and so on, as clearly set out in the report. The APPG assembled the evidence in its report, which is absolutely transparent about its sources. Health Ministers will make of that what they will, but whatever they do it is a useful assembly of a particular subject of interest to that Department.

It is transparency that counts, and that the APPGs are driven and controlled by MPs or peers as appropriate. The Standards Committee was clear on the usefulness of most APPGs as a means of discussion and even the enlightenment of MPs and peers, but I might also say that sometimes the enlightenment comes from MPs and Lords to those attending. As many in the House will be aware, the outside perception of House procedures and timetables is often very wrong. Those who attend sittings from outside this place often find them very educational. I remember the chairman of an important chamber of commerce, whom I will not name, asking for some legal change involving primary legislation, and his absolute failure to understand that even if I, as a Minister, agreed, which I did not, it could not be enacted after having made progress through both Houses in the next week.

In essence, the changes desired in the report are fairly minor and reflect the Committee’s desire not to over-regulate. The sceptical media and others need to realise that APPGs with transparency and light regulation are preferable to ad hoc groups operating without transparency, undercover, which would be the result if APPGs were limited in number or were over-regulated. This is a carefully considered report with relatively minimal changes that essentially extends transparency.

20:04

[Hugh Bayley (York Central) (Lab)]

I start by declaring that for a good long time—a decade or so—I was chair of the Africa all-party parliamentary group. Good and effective all-party groups—they are a mixed bag; some are extremely good and effective, others less so—can have a real influence on public policy. For instance, since the last election, when the Government introduced their defence and security review, the Africa all-party group put in a report that urged the Ministry of Defence to consider the possible security risks emanating from Africa. This was some time before the Libya campaign, but it led to the establishment within the MOD of a unit to look at the African dimension of security.

To give just one other example, under the previous Government, the group produced a report about British involvement in corruption in Africa. It led to the appointment by the Government of an anti-corruption tsar. My right hon. Friend the Member for Blackburn (Mr Straw) held that job for a time, as did the right hon. and learned Member for Rushcliffe (Mr Clarke) after the general election. It also led the Government, after a couple of false starts, to introduce a Bribery Bill, which went through with all-party support in the wash-up just before the last general election.

So all-party groups can have a purpose, but they are a mixed bag. Some are truly independent and use that independent voice to great effect. Others are less than entirely independent; they are a front for particular interests or lobbies, sometimes a pretty transparent front—which is a better option—and sometimes a not particularly transparent front. I agree with the Chair of the Political and Constitutional Reform Committee that there is a scandal to come about the way in which outside interests lobby in the House of Commons. I do not believe that the Lobbying Bill has addressed the problem properly, and I believe that the rotten tail of the all-party group spectrum provides inappropriate opportunities for outside interests to lobby in this place.

So I welcome the recommendations in the report. They move in the right direction, but to my mind they do not yet move far enough. For example, it suggests that each group should maintain a list of those Members of the two Houses who are active in their affairs, and that it should be available either because it is published or on request. It would be better if such lists were published, presumably on the all-party group’s website or the website of the Parliamentary Commissioner for Standards. It helps transparency if the public understand which Members have a particular interest in an all-party group.

I want to raise just one matter that could be advanced under the recommendations in the report. They would permit the Commissioner for Standards to issue guidance or codes of practice. Guidance and stricter regulation is required in relation to the election of officers of all-party groups. Most all-party groups meet as a small band, and elections take place very well in an informal way, with no statutory returning officer or heavy procedures. I would not want to over-regulate the affairs of a majority of all-party groups, which work, because they have limited resources, in a fairly informal way. However, we have had some recent examples of highly contested elections. I see my hon. Friend the Member for Slough (Fiona Mactaggart) in her place. When there are highly partisan and contested elections for officerships of APPGs, the cross-party consensus that exists in most of these groups is undermined. Such a consensus enables groups to have the leverage and purchase on policy that they do.

I deeply regret the fact that there was a party political campaign to take over the chairmanship of the all-party group on human trafficking, which led to two ballots, the first of which resulted in a tie. Messages were sent through party channels—not through the Whips Office, I think—through an informal system of whipping on both sides of the House. Occasionally, there are political differences in all-party groups, which fail if they fracture along political lines. If a self-denying ordinance among Members does not prevent those groups from becoming, in a small number of cases, highly politicised, some form of regulation is necessary.

I spoke to the hon. Member for Wellingborough (Mr Bone), who campaigned to take over the all-party group on human trafficking, earlier today to warn him that I would mention his name in this debate. He told me that his campaign was entirely party political, which I find disturbing. It has happened on two or three other occasions. The chair of the all-party China group was ousted, I believe, as the result of a political campaign.

[Fiona Mactaggart (Slough) (Lab)]

My hon. Friend referred to the all-party group on human trafficking and modern slavery and the election, with a record turnout, which I won and which—he is right—was fought on party grounds. I want to reassure the House that since then, the group has been able to involve Members from all parties working equally enthusiastically on an absolutely broad basis. His comments should not lead anyone to think that that all-party group operates in any way in a sectarian manner, because it does not.

[Hugh Bayley]

I am glad that my hon. Friend has had the opportunity to put that on the record. It is something that I observe from the work the group does.

I should declare a personal interest: I lost the chair of the Africa all-party group because a band of people not from my political party, by a more considerable margin than is normal for our meetings, were organised—perhaps that is the way to put it—to turn up and vote for someone else who, in fact, leads the group extremely well. None of that caucus, which was organised on party grounds to come in and depose someone and elect someone else, had ever been to a meeting of the Africa all-party group, nor has any of them been to a meeting since. I would make the same statement in relation to the Africa group as my hon. Friend the Member for Slough made in relation to the all-party group on human trafficking. It runs extremely well under new leadership and I am content with it.

I believe, however, that the problem of highly contested elections reached a pinnacle of bad form in the recent election in March of this year for the all-party group on Russia. I was aware for several days beforehand that there was going to be an election. I was under the clear impression that the candidate from my party should be supported—a lot of messages went out trying to encourage people to turn up at that meeting and, equally, messages were sent out to members of another party to support an alternative candidate, who won the contest. One might just say that that is what happens in politics, but the conduct of that election would not pass muster if it was a public election. It would not be deemed remotely acceptable if it was a trade union ballot for industrial action. I turned up at the appropriate time in Committee Room 5, which seats 20 or 30 people at a pinch. There were 80 or 100 people in that room, packed shoulder to shoulder, and as many people outside in the corridor. The group’s officers, one from each party, had pre-printed ballot papers with the names of two candidates, although nominations were not sought until the meeting. As luck would have it, only two candidates were nominated, so the ballot papers were in order.

The two all-party group officers then started distributing the ballot papers to a sea of hands, pushing and shoving. There were no checks whatsoever on who took the papers—whether they were Members of either House or whether they took more than one paper. Indeed, I heard someone joking that they would have to go round with ballot papers again, although I saw no evidence of that. I heard people out in the corridors shouting, “Come here. It’s Room 5. Get in there!”, and asking Members to support their candidate.

I think that is a move in the wrong direction. I wrote to the Parliamentary Commissioner for Standards to say that I felt it would be possible to introduce some form of procedure in such cases to improve the transparency and democracy of the elections—I copied the letter to the Chair of the Standards Committee. There is a rule that permits any Member of either House to join any all-party group, and that is extremely important, because we do not want all-party groups to be closed shops for particular groups of people.

[Thomas Docherty]

I know that my hon. Friend is moving rapidly to a conclusion and will not want to spend more time on this issue than he has to, but is he aware that, as the Standards Committee states in its report, the rule on 20 members is not about who is or is not a member of an APPG? Every Member of the two Houses is a member of an APPG and has equal voting rights.

[Hugh Bayley]

I have a couple more things to say, but I will say them quickly.

I believe that we need a system that enables elections to take place from those who have played an active role in a group. That is why publishing a list of members of a group would be a good thing. It should be perfectly in order for someone to put their name on the list up to, say, 24 hours before the election takes place. But the idea that people can turn up to a meeting by the dozen, take ballot papers that are not numbered and not have their names recorded when voting allows a misuse of procedure that should not be permitted.

I would warmly welcome the Parliamentary Commissioner for Standards looking at this issue and, while ensuring that all-party groups remain open to all Members, allowing a better means of regulating such elections where there is a great deal of interest in them.

20:18

[Sir Bob Russell (Colchester) (LD)]

I obviously lead a sheltered life, because in my 17 years in this place I have never witnessed, or been involved in, shenanigans of the sort that have just been described, which underline the importance of and need for the motion before us this evening. All-party groups, if used in the right way and in the right spirit, are an asset to this House, and indeed to the other place.

My experience of membership of all-party groups over the years has been one of colleagues with a shared interest coming together to promote something that is not normally done within the parliamentary channels. Last week I was elected chair of the all-party group for the island of St Helena. In the past the group has done a lot of good work in promoting the island’s interests. For example, the airport that we all campaigned for is currently under construction. I am also chair of the all-party first aid group, which brings together Members from both sides of both Houses. Its sole interest is promoting first aid. For 15 years I was secretary of the all-party scout group. Those all-party groups exist only to promote organisations in this place and benefit them because they have a wider interest in society.

In view of what the hon. Member for York Central (Hugh Bayley) said, let us go with this motion, because we do not want the sort of behaviour he described.

20:19

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

As a member of the Committee, I commend the report to the House. I declare my chairmanship of the autism all-party group and co-chairmanship of the European Union all-party group.

The report is an important step forward in several respects, but most notably in how we seek properly to differentiate the labelling and logos used on reports by registered all-party groups—that is, the crowned portcullis with the appropriate title of the group—and the appearance of documents such as the Select Committee report that I have in my hand. It is vital that all-party groups do not seek to publish documents that look like, or could be mistaken for, reports by Committees of this House. We have to do everything we can to make sure that the media do not continue to fall into the trap of making no distinction between the reports of all-party groups and those of Select Committees. That recommendation by our Committee is particularly important.

20:20

[Kevin Barron]

I am very pleased that the report has the support of the House. I have heard the wider debate on the issues. Paragraph (3) of the motion gives the Committee licence to make minor changes without necessarily coming back to the Floor of the House, but we will use that in a sensible and proper manner, if at all.

Question put and agreed to.

Intelligence and Security Committee

Tuesday 13th May 2014 Commons Chamber

Motion made, and Question proposed,

That Fiona Mactaggart be appointed to the Intelligence and Security Committee of Parliament under Section 1 of the Justice and Security Act 2013.—(Tom Brake.)

20:22

[Mr David Winnick (Walsall North) (Lab)]

Let me make it clear that I have no objections to my hon. Friend the Member for Slough (Fiona Mactaggart) joining the Intelligence and Security Committee. I think we would all agree that she is a person with quite an independent mind, and certainly a strong personality, and no doubt she will make a useful contribution to the Committee. This is nothing personal, and I am sure she did not expect there to be any criticism along those lines.

However, I am far from satisfied that the method of being nominated in the name of the Prime Minister is the best way for a Member to join the ISC. It is going back to former times. The Leader of the House looks rather puzzled, but he knows full well that a system existed in the previous Parliament whereby names appeared on the Order Paper and we would agree to them or otherwise, as the case may be. I take the view that the ISC should be subject to elections. Fortunately, that is not only my view. In paragraph 158 on page 62 of the Home Affairs Committee report on counter-terrorism, which was published last week, it says:

“we recommend that the Commons membership of the Intelligence and Security Committee should be elected like other select committees and that the Chair, who should always be a member of the Commons, ought to be subject to election of the whole House, as is the case for Select Committees.”

It is interesting to note that there has been a great deal of competition as to who should be the Conservative Chair of the Defence Committee. We receive a good deal of correspondence on that subject. While that post is subject to a great deal of competition, and we will decide on it accordingly in the democratic way on Wednesday, for membership of the ISC there is no election whatsoever. A name is put before us and we either accept or reject it.

I simply want to say that whenever an opportunity such as this arises, I will make my views known. This is not an acceptable way to proceed—the Home Affairs Committee agrees—and membership of the ISC should be subject to election. I would hope that at least the Deputy Leader of the House—a Liberal Democrat—would also take that view. Having made my position clear, I do not oppose the motion, but I will use every future opportunity to make my views known.

20:25

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

I have the greatest respect for the hon. Member for Walsall North (Mr Winnick). He is a man of great seniority in this House and we always, rightly, listen very carefully to what he has to say. There is one—and only one—reason why his proposal runs into difficulties. The simple point is that this particular Committee, unlike any other, has access to highly classified information up to the range of top secret, strap-2 level and occasionally higher.

Some people believe that this country should have no secrets at all and that if we had no secrets, there would be no classified information and no case for treating the membership of the Intelligence and Security Committee differently from that of the Defence Committee.

[Mr Winnick]

I am grateful for the hon. Gentleman’s kind remarks, but does he accept that, in the 1980s, before the ISC was formed—I was on the Standing Committee that led to its formation—it was very difficult to get the matter raised at all when I tried to initiate debates on the Security Service? I am in favour of such a Committee and I am certainly in favour of the security services—even more so in the face of acute terrorism—but I want accountability, and I think that is the main difference between the hon. Gentleman and me.

[Dr Lewis]

I hope to show that the difference between us is as small as possible. I was certainly not suggesting that the hon. Gentleman was not in favour of this country having security and intelligence services or, indeed, highly classified secrets. It was as a result of the work that he and his colleagues did back then that it became possible to open up the intelligence and security agencies to much greater scrutiny. Their activities can now be examined and debated considerably. To a large extent, that happens in the open—in the public arena of Parliament—but when it cannot be done in the open, it can now, thank goodness, be done in the closed and secure environment of the Intelligence and Security Committee.

I will move on quickly, because I do not wish to detain the House for longer than is necessary. Some people think that we should have some secrets but that there is not a single hon. Member of this House who could not be trusted to know them. If that is one’s view, there would not be any argument against the membership of the ISC being elected just like the membership of any other Committee. However, the membership of this House reflects society in all its varied shades, phases, types and categories. The fact is that I do not think there are many people who would say that, out of 650 Members, there are not at least some who are not quite, shall we say, discreet or tight-lipped enough to share in the most sensitive secrets of the security and intelligence agencies. If one makes that concession, one has to admit that this Committee, if it is going to see such material, has to have some sort of screening process and cannot simply be subject to the ordinary process of election, unless we are content that any single elected Member of this House can, by definition, be trusted not to do something foolish if given access to highly sensitive information.

[Mr Winnick]

We all know, of course, of the hon. Gentleman’s own history of pretending to be someone else—namely a Labour supporter—in order to infiltrate the Labour party. I would not suggest that, because of his action then, he should be debarred from membership of the ISC.

[Dr Lewis]

I am delighted to know that. I have to admit to the hon. Gentleman that one of the reasons I put myself forward for a place on the Committee was to test the water and see if any of my past nefarious activities, as he would regard them, would result in my being black-balled. I came to the conclusion that I was appointed for one of two reasons: either it was thought that I was so discreet—

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order. I fully appreciate the points that the hon. Gentleman is making, but however exceedingly interesting they may be, they do not entirely relate to the very narrow motion before us.

[Dr Lewis]

Indeed, Madam Deputy Speaker. If I may, I will just conclude that sentence by saying that I came to the conclusion that it was regarded as a suitable Committee on which to put a troublemaker who could not talk about what the Committee was discussing.

In conclusion, most people think that where highly classified material is concerned—material covered by the Official Secrets Act—some people are better suited than others to be allowed to see it. It is not acceptable or compatible with that for the whole House simply to vote for any Member to be a member of the Committee, because the Committee would not be allowed to continue to receive such material. However, I hold out a smidgeon of hope for the hon. Member for Walsall North in that a case could be made on the basis of the argument that once all the members have been appointed, the objection would fall in relation to the Chairman. Once all the people who are regarded as appropriate to see highly classified information are known, I cannot see why the whole House could not then decide which of those cleared Members should be the Chairman, but perhaps that is for another occasion.

20:31

[Mr George Howarth (Knowsley) (Lab)]

It is a pleasure to follow the hon. Member for New Forest East (Dr Lewis). Indeed, I agree with everything he said, in so far as it related to the motion.

To be perfectly honest, I am slightly confused about why my hon. Friend the Member for Walsall North (Mr Winnick) chose to speak in this debate, although I do not doubt his right to do so. There can be only two reasons for someone to object to the motion: either they object to my hon. Friend the Member for Slough (Fiona Mactaggart)—but he said that he does not object to her—or, alternatively, they object to the motion itself and the procedure on which it is based. As the House will know, the motion relates to section 1 of the Justice and Security Act 2013. I suspect that he spoke against that provision when the Bill went through the House and was defeated. If he objects to the provision, I find it confusing that he said he would not object in any meaningful way. I am not quite sure what the point of his speech was. Ultimately, he will not object to her being put on the Committee, but at the same time he will not object to the procedure, so I am at a bit of a loss to explain why he chose to detain the House tonight, but perhaps he can explain.

[Mr Winnick]

I am puzzled that my right hon. Friend is puzzled. No, I have no personal or political objections to my hon. Friend the Member for Slough (Fiona Mactaggart)—why should I?—but as I thought I had made perfectly clear, I am opposed to a system in which, in the name of the Prime Minister, a Member’s name is simply put before us and we say yea or nay. Let me make it quite clear to my right hon. Friend that I am in favour of democracy and of people going on Committees subject to election, and that includes the ISC.

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order. The hon. Gentleman has already made his point—in my judgment, he has made it clearly—and he does not have to repeat it.

[Mr Howarth]

I think that I am grateful to my hon. Friend for his intervention, but it did not take us any further. I do not intend to address it any more, because it did not take his argument any further. Having said that, I conclude by congratulating him on the one overriding quality that I have observed him to possess over the years: he is consistent; it is just that he is consistently wrong.

[Mr Winnick]

That is a disgraceful remark, George, and you know it.

[Madam Deputy Speaker]

Order. No remarks have been made.

Question put and agreed to.

Business without Debate

Tuesday 13th May 2014 Commons Chamber

delegated Legislation

Tuesday 13th May 2014 Commons Chamber

[Madam Deputy Speaker (Mrs Eleanor Laing)]

With the leave of the House, we shall take motions 6 to 11 together.

Motion made, and Question put forthwith (Standing Order No. 118(6)),

Copyright

That the draft Copyright and Rights in Performances (Disability) Regulations 2014, which were laid before this House on 27 March, be approved.

That the draft Copyright (Public Administration) Regulations 2014, which were laid before this House on 27 March, be approved.

That the draft Copyright and Rights in Performances (Research, Education, Libraries and Archives) Regulations 2014, which were laid before this House on 27 March, be approved.

Aggregates Levy

That the draft Revenue and Customs (Amendment of Appeal Provisions for Out of Time Reviews) Order 2014, which was laid before this House on 31 March, be approved.

Licences and Licensing

That the draft Licensing Act 2003 (FIFA World Cup Licensing Hours) Order 2014, which was laid before this House on 1 April, be approved.

Energy

That the draft Renewable Heat Incentive Scheme (Amendment) Regulations 2014, which were laid before this House on 9 April, be approved.—(Claire Perry.)

Question agreed to.



Motion made, and Question put forthwith (Standing Order No. 118(6)),

Church of England (miscellaneous Provisions) Measure

That the Church of England (Miscellaneous Provisions) Measure (HC 1273), passed by the General Synod of the Church of England, be presented to Her Majesty for Her Royal Assent in the form in which it was laid before Parliament.—(Sir Tony Baldry.)

[The Treasurer of Her Majesty's Household (Greg Hands)]

I have it in command from Her Majesty the Queen and His Royal Highness the Prince of Wales to acquaint the House that they, having been informed of the purport of the Church of England (Miscellaneous provisions) Measure, have consented to place their prerogative and interest, so far as they are affected by the measure, at the disposal of Parliament for the purposes of the measure.

Question agreed to.

Business of the HOuse

Tuesday 13th May 2014 Commons Chamber

Ordered,

That at the sitting on Wednesday 14 May the Speaker shall not adjourn the House, if a Message from the Lords Commissioners is expected, until that Message has been received.—(Mr Andrew Lansley.)

Hull Official Receiver’s Office

Tuesday 13th May 2014 Commons Chamber

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

20:37

[Diana Johnson (Kingston upon Hull North) (Lab)]

I am pleased to speak about the proposed closure of the official receiver’s office in Hull, and I thank the Minister for meeting me and other Hull MPs to discuss this issue on 6 May—I note that she has had busy day in the Chamber today. The proposal is to close the Hull office and relocate more than 40 staff to Leeds. The claim is that that will produce a saving of about £289,000 over five years, which rather pales by comparison with the bill of £353,000 for tea and biscuits in the Minister’s Department in 2012.

I accept that nationally the work of the Insolvency Service has declined considerably across the country over the last few years, and we are seeing fewer cases coming forward overall. However, the argument is not about reducing the number of staff employed in the service, but about concentrating work in certain locations, and that is where I want to focus my contribution this evening.

The decision to close the office in Hull undermines the efforts of all those who are working to create a more prosperous city. Hull needs an additional 7,000 jobs to get to the national level of employment, and while we have had welcome news about Siemens coming to the city—something won by local effort—we have been hit hard by the recession and three years of flatlining.

We know that the closure will take around £1 million out of the local economy, at a time when Hull has hardly any Government jobs. The Department for Business, Innovation and Skills is supposed to be committed to economic regeneration of the regions, but how does this policy help with that aim? The Government are also supposed to have a policy of distributing Government and civil service jobs around the country. What consideration was given to the relative number of civil service jobs in Hull and Leeds when making this decision?

Hull has exceptionally few Government jobs: 10 Departments, including the Minister’s own Department for Business, Innovation and Skills, have no staff in Hull. Departments that do have staff in Hull, like the Ministry of Justice, tend to have front-line delivery staff. As I said, the plan is to move the Insolvency Service jobs to Leeds, where there are already more than 9,000 civil service jobs and where office rents are far more expensive. I have observed a similar pattern repeated across the country: the insolvency office in Stoke, where rents are very cheap, is being closed and moved to Manchester where rents are higher. Previous Governments have had a clear policy of distributing Government jobs around the country—do this Government still have that policy?

I heard the Deputy Prime Minister this morning waxing lyrical on the Floor of the House saying:

“I am always open, as are the Government, to proposals on moving further parts of the public sector from Whitehall and London to other parts of the country. Sheffield”—

where his constituency is—

“has benefited enormously from that, with the Department for Work and Pensions and the business bank being established there.”

It seems to me that we have a Government who are certainly not looking at spreading Government jobs fairly across the regions and are in fact now taking them away from East Yorkshire.

It appears that civil servants based in London have decided that it is a good idea to close offices in Hull. I imagine them in their offices in Whitehall with a map of the UK, and, almost as happened in the second world war, moving around people they think can be distributed around the country, with no thought for the effect on communities.

The business case says that this closure programme is being driven by the Cabinet Office’s Government property unit, which aims to reduce the number of properties in the central civil estate. It seems that there is a desire to centralise jobs in a few places, with little consideration given to the wider economic consequences or even to the fact that in some cities rents will be much higher than in other parts of the country. What similar cost savings have been made by the Minister’s Department in London? The plans being put forward for Hull are about saving £289,000 over five years, which is a drop in the ocean compared with the cost of renting or occupying office space in central London. How many posts have been moved out of London since 2010, and at what saving to the taxpayer? How much office space has been freed up at the Department for Business, Innovation and Skills in London and, in particular, in the head office on Victoria street?

Another of my concerns is about the consequences for the economy of the closure of the Insolvency Service for the Humber region. Through the establishment of the local enterprise partnership, the Humber is seeking to forge a path as a separate economic region with a distinct identity. The Insolvency Service has developed specialist knowledge of the region which, if these plans go ahead, will be subsumed by the wider Yorkshire region based in Leeds. Hull staff have more than 600 years of collective insolvency experience. Last year, that saved the economy more than £2.5 million, as they disqualified 20 directors. There is a particular value to having local knowledge about what is going on in an area. As we know, unfortunately many people the Insolvency Service deals with are repeat offenders. Of 17 local official receiver offices, Hull is joint fifth in terms of the number of disqualification reports—that is quite high.

An example of the good work that has been done is the fact that local knowledge in the Hull office stopped German bankruptcy tourism in the Hull county court. The limited liability partnership provided false addresses to German residents but that has been wound up thanks to the local knowledge and work of the Hull office. Without local knowledge of the places referred to, it is unlikely that that fraud would have been stopped, so will the Minister give me her view of the assessment undertaken by the Insolvency Service of moving direct regional centres to larger autonomous units in terms of the detection of fraud?

Following our meeting on 6 May, the Minister promised that she would provide the business case to me and to other Hull MPs. However, the information contained in the business case that I have been given is limited solely to the Hull, Leeds and Sheffield offices. It does not give a comparison between Hull and other offices of a similar size that have not been closed.

The savings identified are mainly saved office costs offset by £125,000 in train fares for three years for staff who relocate to Leeds. That is good news for First TransPennine Express, the local train operator, and it may be that it can use that money to provide some much needed investment on the Hull-Leeds line instead of sending trains south. There is, however, much that is missing from the costing in the limited business plan. The first thing is redundancy costs.

The staff in the Hull office are exceptionally experienced: collectively, they have more than 600 years of experience. Having spent their lives working in Hull, however, many do not want to travel to Leeds and all have been offered redundancy payments. From union sources, I understand that redundancy costs could be as high as £1 million. Where is that allocated in the business plan? The saving of £289,000 over five years is relatively small, yet redundancies could cost £1 million. I appreciate that that is provided for by a different budget directly funded by the Treasury, but it all boils down to taxpayers' money, and the Government should be acting in a more joined-up way when looking at the closure costs of this office.

On training new staff, it is accepted by the Insolvency Service that the staff in the Hull office are required to meet the necessary case load not just of work from Hull but other areas of the country. The business case blithely presumes that all Hull staff will move to Leeds. As I said, I think there are questions about the numbers of staff who will choose to take redundancy. It takes three years to train a level 3 examiner before qualifying, but the costs of recruiting and training staff do not seem to be included in the business plan.

Bizarrely, in the very brief consideration given in the business case for moving the Leeds office, which as I said has 9,000 civil servants, to Hull, which has very few civil servants based in the city, the presumption that 30 staff would not move across is included, along with associated costs of recruiting, training and the short-term loss of capacity. Will the Minister explain why she has presumed that Leeds staff will not move to Hull, but all Hull staff will move to Leeds?

A further concern is about the way the consultation with the trade unions has been conducted. The Minister has consistently maintained that the Insolvency Service has been attempting to work with the Hull office to find a way of keeping the office open. In answer to a recent parliamentary question, the Minister wrote:

“The trade unions were made aware on 25 February 2014 that the future of the Hull office was being considered, and were invited to provide any views they wished.”—[Official Report, 6 May 2014; Vol. 580, c. 93W.]

This was not, however, the impression given to the trade union, Prospect. Prospect told me

“that the Service would be running exit schemes and then closing offices. There was never discussion on whether an office closure was justifiable as we had not been provided with the financial justification and despite requests by the Trade Unions, the Service would not release the business cases for the closures.”

Consultation with the trade unions only commenced when the decision to close the Hull office was made on the basis of a statutory 90-day consultation. Will the Minister outline exactly when the trade unions were involved, and what opportunities they were given to inform the closure plans? The Hull office was told on 25 February that the future of the office was under review and that the review would take six months. In the meantime, it looked at ways of reducing its costs, including preliminary discussions on new premises that would reduce the rent by approximately £90,000 per annum. Obviously, office rent is one of the key issues in this whole business. Two weeks later, however, the service informed the Hull office that it would be closed, and showed no willingness to work with the office in seeking alternatives to closure. It is clear from the business case that no consideration was given to cost reductions within the current structures, as identified by the team working in Hull.

The savings from the closure of the Hull office appear to me to be uncertain, but the £1 million cost per year to Hull’s local economy would be all too certain. We know that, owing to decisions made in Whitehall by the coalition Government, Hull city council suffered one of the heaviest funding cuts in the United Kingdom—despite being the UK’s 10th most deprived area—and there are worries about not just Hull’s insolvency office but its land registry office, whose future is currently under review.

The coalition frequently claims to support the idea of “rebalancing the economy”, north and south. As I said earlier, one way of doing that would be moving Government Departments and agency civil servants’ jobs to places such as Hull rather than taking them away. This debate may be about saving only 40-odd jobs in Hull, but every job matters in a town where so many people chase each job vacancy and so many jobs are low paid and low skilled.

I think that, provided that the service is needed and can be run efficiently, we should fight to save every job in Hull that is under threat, and there is a strong case for keeping the official receiver’s office open. That would be consistent with what the Government say their policy is—but too often what they say and what they do are different things, especially when it comes to the treatment of northern cities such as Hull. It seems to me that devolved jobs are going the same way as Lord Heseltine’s devolved funding, and that, yet again, Hull is not getting a fair deal from this Government.

20:52

[The Parliamentary Under-Secretary of State for Business, Innovation and Skills (Jenny Willott)]

I trust that we will not detain you for too much longer, Madam Deputy Speaker.

I thank the hon. Member for Kingston upon Hull North (Diana Johnson) for securing the debate. I recognise the interest that she has shown in the relocation of the Insolvency Service’s office in Hull. As she said, we met last week to discuss the issue, along with other Hull Members, and I entirely understand why she is concerned about the potential impact on her constituents and is representing their views this evening.

Let me put the position in context. The Insolvency Service is an executive agency of the Department for Business, Innovation and Skills. It has about 1,800 employees, who operate from locations throughout the country. They deal with a wide range of insolvency matters, such as administering bankruptcies and liquidations —which includes realising assets and distributing them to creditors—dealing with corporate malpractice and misconduct by investigating companies and individuals abusing the system, and managing payments to employees who are made redundant. The administering of insolvencies is funded by fees charged against the assets of insolvents. It is obviously very important to the creditors involved for the costs to be kept as low as possible, while still providing for an effective and fair service.

As the hon. Lady acknowledged, the past five years have seen a sharp drop in the number of insolvencies handled by official receivers’ offices, from about 80,000 cases in 2009 to nearer 25,000 today. That is largely because of a sharp fall in the number of debtor petition bankruptcy cases following the winding back of high levels of lending. To date, it has led to a reduction of about a third in the staff of the Insolvency Service, which has been achieved through a programme of voluntary exits.

As for the question of where offices need to be, for the purposes of official receiver work in particular, the Insolvency Service needs to be able to interview insolvents within a reasonable distance of their homes. We would therefore usually choose city or town centre locations close to transport hubs. The Insolvency Service reviewed its network of local offices in the context of customer demand and the reduced number of employees, and estimated that the estate was about a third too large. It therefore embarked on a programme of estate rationalisation, which also accords with the Government’s wider agenda of minimising the costs of their own estate.

The hon. Lady asked about the estate in London and the south-east. In the past two years the Insolvency Service has been looking at its estate across the country, and in London it has relocated to cheaper buildings in surplus Government estate in both London and Croydon. It decided to close its Watford and St Albans offices as well. It has therefore made such decisions across the UK, including in London and the south-east; it has not targeted other areas.

Individual offices need to be of sufficient size to be sustainable both as a management unit and to provide development opportunities for staff, as well as to be able to offer the necessary flexibility as workloads change. The skills needed for the different areas of work in the Insolvency Service are often similar, so in the last few years several hundred staff transferred from working on bankruptcies to investigation work as the number of cases dropped. This type of work is especially located in the larger metropolitan areas.

As a result of the review, five relocations and five closures took place in 2013-14 and a further 10 closures will take place over the coming financial year. The Insolvency Service has worked closely with the trade unions throughout this process. All employees in the affected offices have been offered the opportunity to relocate to another office or take voluntary exit terms. The Insolvency Service offers excess fares to staff for a three-year period after a move. It also discusses flexible working arrangements to try and find ways to make a move possible for employees.

The Insolvency Service is proud of its customer service, recently coming second out of 53 Government Departments and agencies, with customer satisfaction levels of 96%, which is extremely high. Around 250 face-to-face interviews arise from cases in the Hull office. That is not a large number in the context of the total number of bankruptcy interviews across the country, but in order to maintain high levels of customer service, interview facilities will be set up in other Government buildings in Hull, at minimal cost and with flexible arrangements, to be available for meetings. Replacing an office with an interview facility makes no difference from the point of view of customer experience.

Turning to the specific concerns with respect to the Insolvency Service in Hull, there are 43 permanent employees in the Hull office and the prime purpose of the office is to carry out the duties of the official receiver. Case numbers in the area served by the Hull office have seen an even greater decline than the fall in caseload nationally, with a drop in workload of 79% since 2009, which is a huge drop. Staffing levels in Hull, however, have only fallen by 43%, so there is a mismatch there.

The office was kept busy over the last two years by taking cases in from other offices. The Insolvency Service prefers each official receiver’s office to deal with the cases that arise within its area. As the hon. Lady said, that local knowledge is important. Also, with the general declining workload there is less surplus work to be transferred between offices. As a result, the Hull office is increasingly difficult to sustain from an operational perspective.

The hon. Lady mentioned the number of company director disqualifications achieved in Hull. The total number of disqualifications in 2013-14 was 27, and that was a great result by the staff in Hull and reflects very well upon their commitment and expertise. To put the figure in context, there were 1,273 company director disqualifications in 2013-14. There is significant value in disqualifications, but the disqualification work carried out by Hull will not be lost, but will be transferred to other locations, including Leeds, so disqualifications will continue.

On 27 March the Insolvency Service announced that its office in Hull would close, with its work and employees being relocated to Leeds in November 2014. This decision will both help the service reduce the number of offices and also improve long-term resilience in the face of reduced case numbers. Consolidating in Leeds allows the Insolvency Service to use its work force more flexibly, and in the longer term to offer a wider range of career opportunities to staff.

[Diana Johnson]

I am listening carefully to the Minister’s remarks, but the coalition Government said that they wanted to rebalance the economy and ensure that all the regions benefited. Taking away the limited number of Government jobs in Hull, an area that is blighted by terrible unemployment, flies in the face of what the Deputy Prime Minister said just this morning in the House.

[Jenny Willott]

We recognise that rebalancing the economy geographically is important, and I will come on to some of the work that the Government are doing in that area. We are not talking here about taking work out of the north of England and centralising it in London: we are talking about ensuring that the estate of the Insolvency Service is sensibly spread across the country and that the offices are where the work is. That is an important part of having an effective and efficient operation.

I appreciate that the decision to close the office is not what Hull employees want and I know that the Insolvency Service board did not take the decision lightly. I am aware that the board fully considered the option of moving to cheaper Government property in Hull, as well as closing its Leeds office and moving those operations to Hull. The business case put forward did not just include accommodation costs: it also looked at other benefits, such as efficiency savings stemming from combining teams, the ability to be flexible in how the Insolvency Service deploys its employees and the greater potential for personal development provided by moving between different roles in a larger office.

The business case calculated that a move from Leeds to Hull would have a net present cost of £535,000 over five years, against a net present value saving of £289,000 for a move from Hull to Leeds. Costs would have been higher for a move from Leeds to Hull because the lease on the Leeds building runs until 2018, whereas the Hull lease only runs until 2016. That is a significant difference.

[Diana Johnson]

I am interested to hear about the leases, and we discussed that issue when we met last week. Have there been any discussions or consideration—it was not in the business plan that I saw—of whether the office space in Leeds could be sub-let? Rent is much more expensive in Leeds than it is in Hull.

[Jenny Willott]

At the meeting last week we also pointed out that it is not physically possible to fit all the employees from the Leeds office into the Hull office, so we would need to find a new office in Hull and bear all the costs of refurbishing that. That option was looked at in detail, but it simply was not a financially viable alternative.

The business case took into account that not all the staff would wish to move from Hull to Leeds, although the hon. Lady said that it did not. The estimate was that about half would move and half would take voluntary redundancy. The costs associated with that were built into the business case for both scenarios. The Insolvency Service board considered that the business case for moving from Hull to Leeds was persuasive. Those employees who wish to relocate will have a job in the Leeds office, and the Insolvency Service will pay excess fares for three years. The Insolvency Service has been having one-to-one meetings with its employees as well as keeping closely in touch with their representatives about the implications of the relocation and the impact on individuals. For those who do not want to move office, the option of voluntary redundancy is available, but that is clearly the last resort for most people.

The hon. Lady also raised concerns about employment in the Hull area. I reiterate the Government’s commitment to supporting the Hull area. This issue was raised in Deputy Prime Minister’s questions earlier, and it is a real commitment on the part of the Government. The Humber local enterprise partnership predicts that the city deal for Hull and Humber will deliver more than 4,000 jobs in offshore wind-related industries; at least 1,100 unemployed young people supported into work; 3,400 construction jobs; an expected £460 million of private sector development on the Humber; engagement with more than 3,000 businesses; and the provision of extensive support to 500 businesses, creating approximately 400 jobs. Significant effort and work are therefore going into the area, and the Government are committed to ensuring that we invest in other regions of the UK, and that we are not focused centrally on London and the south-east.

In conclusion, I appreciate that this is a very difficult time for the Insolvency Service and its employees. I hope that the hon. Lady is reassured that the Insolvency Service is aware of the issues that she has raised, that her questions have been considered and that the service is supporting affected employees during the transition period.

The Insolvency Service wants to maintain and improve its already high levels of service delivery. It is making its services more efficient to improve returns to creditors. I appreciate that this is a challenging time for staff, but I congratulate them on maintaining high levels of performance throughout a very difficult programme of change. I hope that I have reassured the hon. Lady that the proposal has been well thought through, that the alternatives have been considered, and that staff and trade unions have been involved and consulted throughout.

Question put and agreed to.

21:05

House adjourned.