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Karl MᶜCartney (Lincoln) (Con)
1. What steps he is taking to support higher-level skills in further education.
The Secretary of State for Business, Innovation and Skills and President of the Board of Trade (Sajid Javid)
I am sure the whole House will want to join me in sending its best wishes to Major Tim Peake, who successfully blasted off towards space just 30 minutes ago. [Hon. Members: “Hear, hear.”]
We are reforming technical education and establishing clear routes into higher-level skills and employment. We are spending £2.5 billion on apprenticeships—double the amount in 2010—and £1.5 billion on adult skills, growing degree and higher apprenticeships and establishing specialist colleges.
Karl MᶜCartney
I join the whole House in sending the Secretary of State’s good wishes to our fellow countryman.
Under the Conservatives, Lincoln’s improved educational map offers the young people of Lincoln myriad—nay, a plethora of—opportunities. Does the Secretary of State agree that prioritising funding for young adults, the low-skilled and those actively looking for work is the right thing for a Conservative Government to do?
Sajid Javid
I absolutely agree with my hon. Friend, who I know cares passionately about skills for young adults. He will be pleased to know that we rightly prioritised spending on further education in the recent spending review, which will enable colleges, such as Lincoln college in his constituency, to offer more to young people.
Mr Adrian Bailey (West Bromwich West) (Lab/Co-op)
Further education colleges are vital for apprenticeships in engineering and construction, in which there is an acute shortage of skills across the country. What assessment has the Secretary of State made of the cuts in funding to FE colleges in terms of delivering this much-needed agenda?
Sajid Javid
I am surprised that the hon. Gentleman is talking about cuts in FE spending. I know that is what Labour was scaremongering about just a few weeks ago, but we have actually protected the adult education budget in cash terms, we will double spending on apprenticeships by 2020 and we have extended the availability of advanced learner loans. Taken together, this will mean a 35% real increase in FE spending by 2020 compared with this year.[Official Report, 5 January 2016, Vol. 604, c. 1-2MC.]
Dr Andrew Murrison (South West Wiltshire) (Con)
22. I welcome the removal of the cap on university places, but what assessment has my right hon. Friend made of the effect on further education colleges, such as Wiltshire college in my constituency, given that they are fishing from the same pool in terms of vocationally based diplomas and apprenticeships?
Sajid Javid
I welcome my hon. Friend’s question. We have seen an increase in that, especially in FE colleges that offer higher education courses, which is exactly the kind of diversity and growth we want.
Andrew Gwynne (Denton and Reddish) (Lab)
But as ever, it is smoke and mirrors with this Secretary of State. He knows that the Chancellor has announced an extra £360 million of savings from the adult skills budget, so will he come clean and tell us where those cuts will be made?
Sajid Javid
The Department will shortly issue a skills funding letter answering some of the hon. Gentleman’s questions, but perhaps he missed the point that I just made: the adult education budget is protected in cash terms, we will double spending on apprenticeships by 2020 and the FE budget will be up by the end of the Parliament in real terms.
David T. C. Davies (Monmouth) (Con)
2. What steps he is taking to ensure that the Government receives value for money from its funding of the Met Office.
The Secretary of State for Business, Innovation and Skills and President of the Board of Trade (Sajid Javid)
The Met Office plays a key role in our economy. A recent review of the public weather service assessed it as delivering up to £1.5 billion of annual value. As the shareholder for the Met Office, I and my officials regularly hold it to account and ensure it delivers value for money for the taxpayer.
David T. C. Davies
The BBC, no less, reported in 2012 that in 11 out of the previous 12 years predictions about increases in temperature had been wrong and that there had been a warm bias. Does the Secretary of State, as the shareholder, agree that he should be asking some tough questions at the board meeting about why we should be imposing expensive climate change policies on businesses and householders, when so often the predictions behind them are proved to be inaccurate?
Sajid Javid
I always like to ask tough questions, but I note there was flooding in my hon. Friend’s constituency recently, and the Met Office played a key role in helping the emergency services and protecting lives and property. Today is an opportunity to commend the Met Office for some of the work it does.
Andrea Jenkyns (Morley and Outwood) (Con)
3. What steps he is taking to promote trade opportunities for UK businesses.
The Secretary of State for Business, Innovation and Skills and President of the Board of Trade (Sajid Javid)
I chair the exports implementation taskforce, which is driving cross-Whitehall support for exports. In November, my noble Friend Lord Maude launched the five-year Exporting is GREAT campaign, which promotes real-time global export opportunities to business.
Andrea Jenkyns
In November, I hosted an event in my constituency with the China-Britain Business Council to which I invited small businesses to come and find out more about trading with China. The all-party parliamentary group on China is aiming to help 50 Members to organise similar events. Can my right hon. Friend tell me how his Department plans to make good use of our new trading relationship with China to help small businesses expand into these vital global markets?
Sajid Javid
Let me commend my hon. Friend on her efforts to encourage businesses in her constituency to export more to China. While exports to China have doubled in the last five years, there is a lot of potential and a lot more that we can do. The recent visit by the Chinese President helped to highlight that, and the effort that my hon. Friend is making with UK Trade & Investment, the China-Britain Business Council and others provides an example to us all.
Nic Dakin (Scunthorpe) (Lab)
What steps has the Secretary of State taken since the steel summit to increase trade opportunities for the UK steel sector?
Sajid Javid
The hon. Gentleman makes an important point. The more we can export of higher-value steel products, the more we can help. We have been discussing this with UKTI and steel producers. We are coming up with a plan, and this will certainly feature in the trade meetings we have in due course.
Amanda Milling (Cannock Chase) (Con)
Next month, I will be jointly hosting an event with UKTI to encourage more local Cannock Chase businesses to consider exporting. Will my right hon. Friend outline what the Government are doing to encourage new businesses to export?
Sajid Javid
I can talk about a number of initiatives, including the Exporting is GREAT website and the roadshow that will visit constituencies up and down the country. There is obviously also the work that UKTI is doing. Most recently, I helped to launch the midlands engine scheme, which I know my hon. Friend will welcome. We released more money to help that region with exports, including a midlands engine roadshow.
Ms Margaret Ritchie (South Down) (SDLP)
As part of the work of the export implementation group, will the Secretary of State explore with the Secretary of State for Environment, Food and Rural Affairs all options to access new markets for all our farm produce in north America and south-east Asia?
Sajid Javid
Absolutely. The hon. Lady makes an important point. I know that the Secretary of State for Environment, Food and Rural Affairs has been taking this matter very seriously. One thing we have done recently is to move some of the UKTI resources into my right hon. Friend’s Department so that there is better co-ordination.
Mr Peter Bone (Wellingborough) (Con)
I recently talked to a senior Indian businessman and asked him how we could increase trade with India. He said that the one thing we could do was to leave the EU because of the restrictions. Will the Secretary of State, either as Secretary of State or personally, endorse his comment?
Sajid Javid
I spoke to a lot of Indian businessmen and women and many Indian students last week. There is certainly one area in respect of which we could certainly increase our exports to India, and that is education.
Kevin Brennan (Cardiff West) (Lab)
It is all very well, but it is not working, is it? The UK’s latest balance of trade deficit is widening. It was up to £2.4 billion in the last quarter. Exports of goods—[Interruption.] Perhaps the Minister for Small Business, Industry and Enterprise should have a little listen to this. Exports of goods from the UK actually fell last month by £700 million. It is a pity we cannot export spin, because the Government are very good at that. The “march of the makers” was very good, and now we have the “midlands engine”. What is the Secretary of State’s excuse for the Government’s dismal record on the trade deficit?
Sajid Javid
The hon. Gentleman should not do down our world-class exporters. They are doing a fantastic job. Let me give him a few examples of what they can export. They can export wine to France, chocolate to Belgium and even boomerangs to Australia, although I fear that it is sometimes the same boomerang that keeps coming back.
Craig Tracey (North Warwickshire) (Con)
4. What steps he is taking to improve standards in apprenticeships.
The Minister for Skills (Nick Boles)
We have given employers control over apprenticeship standards and require all apprenticeships to last at least 12 months and involve substantial off-the-job training. We will be setting up an independent, employer-led institute for apprenticeships to approve standards and assure quality in future.
Craig Tracey
I thank the Minister for that response, and I welcome the fact that there have been nearly 1,100 apprenticeship starts in north Warwickshire and Bedworth over the last 12 months. However, I know that local businesses are concerned that the focus might be on quantity rather than quality. What assurances can the Minister give to my constituents, especially those in highly skilled engineering, that that will not be the case?
Nick Boles
There is, in fact, no innate tension between quantity and quality. We want better quality, because that will mean more employers wanting to offer apprenticeships, such as BMW in my hon. Friend’s constituency. I strongly welcome the very high-quality apprenticeships that it is creating.
Stephen Timms (East Ham) (Lab)
As the Minister will know, Ofsted has said that apprenticeships are not good enough at present, and many people in industry believe that the only way to hit the 3 million target is to water down quality further. What reassurance can the Minister provide?
Nick Boles
I welcome that question, because while it is true that Ofsted has highlighted some bad practice, that bad practice has been familiar to us all for a long time, and has inspired the reforms that we are introducing. All apprenticeship frameworks will be replaced by standards developed by employers. Training must last for more than 12 months, and at least 20% of it must be off-the-job training. We will also ensure that quality improves at all levels. I disagree slightly with the chief inspector’s implication that a level 2 apprenticeship is somehow not of high quality. Apprenticeships should be of high quality at all levels, and the existing level 2 apprenticeships increase people’s incomes by an average of 11% three to five years later.
Stephen Metcalfe (South Basildon and East Thurrock) (Con)
23. There were 970 new starts in my constituency last year, many of them in engineering and technology. That was an increase of 24% on the number of starts in the previous year. Will my hon. Friend join me in congratulating the new apprentices, and does he agree that those figures show that the Government are committed to high-quality apprenticeship places, such as those that are provided at Prospects college of advanced technology?
Nick Boles
That was a stunning achievement in my hon. Friend’s constituency. I know that it was largely due to PROCAT, which is an excellent institution, and one of the first institutions to become a college for a long time. My visit to PROCAT was my first visit to a college in my current job, and if my hon. Friend invites me to return, I shall be happy to do so.
Peter Kyle (Hove) (Lab)
I commend the Minister for establishing an institute for apprenticeships which will put employers at its heart, but may I suggest that he should consult trade unions and find ways of harnessing their insight and experience in this valuable area?
Nick Boles
As the hon. Gentleman knows, I greatly value the work that trade unions do in encouraging employees to take up training opportunities, which is why we continue to fund the important work of Unionlearn. I will certainly reflect on his suggestion, and will make some announcements shortly.
Mr Philip Hollobone (Kettering) (Con)
Snap-on is a major United States manufacturer, developer and marketer of tools, and its UK headquarters are in Kettering. Given that it is seeking to increase its investment in apprenticeships throughout the country, will my hon. Friend accept an invitation to open its new £2 million facility in Kettering on 15 February?
Nick Boles
I am glad to say that Kettering is very close to my own constituency. If the Whips allow me, I will be there.
Mike Kane (Wythenshawe and Sale East) (Lab)
5. What steps his Department is taking to support businesses which export.
The Secretary of State for Business, Innovation and Skills and President of the Board of Trade (Sajid Javid)
My Department is leading a cross-Whitehall work programme to support exports. For example, UK Trade & Investment connects UK businesses with export opportunities throughout the world. Over the next year, the UKTI export hub will travel around the country to give face-to-face assistance to first-time exporters.
Mike Kane
Feedback from businesses in my constituency suggests that there needs to be more support for small and medium-sized enterprises that export less than half a million pounds’ worth of goods. It suggests that once they are in the bracket of Government support, that support is short-lived, and is complicated by red tape. How would the Secretary of State respond to those businesses?
Sajid Javid
I agree that we should always try to do more to help small and medium-sized enterprises, in particular, to export more. The hon. Gentleman may know that I recently led one of our first regional trade missions, the northern powerhouse trade mission, to the far east. It included not only the Greater Manchester chamber of commerce, but companies such as Televic Education, which is in his constituency.
Tom Pursglove (Corby) (Con)
Fairline has a long history of exporting luxury boats across the world, but last week we heard the devastating news of 380 redundancies. While I hope that the administrator can identify a buyer, many of those employees have been laid off for significant periods with reduced pay. Will the Secretary of State do all that he can to ensure that the redundancy payments are expedited, especially given that Christmas is just around the corner?
Sajid Javid
This is, of course, a very difficult time for the employees who have been affected. I will certainly look into the position, and, during discussions with any potential buyer, I will ensure that export opportunities are highlighted.
David Simpson (Upper Bann) (DUP)
Do the Government foresee any long-term difficulties with the transatlantic trade agreement with the United States if the Americans decide to export agri-food products into the UK?
Sajid Javid
The hon. Gentleman will know that these discussions are still going on. By their very nature, they are complex, as two huge economic areas are involved, and so they will still take some time. Agri-products and all products of that nature need to be carefully looked at, so we have not reached a final point. It is worth remembering that once this deal is done, it can be worth up to £400 for every household in the UK each year.
Michael Fabricant (Lichfield) (Con)
In my former career, I exported broadcasting equipment to 48 countries worldwide—no thanks to the EU and its regulations. Is it not the case that people need the chutzpah to export, and although the Department can give as much help as it can, people have actually to get out there and do it, and be confident in doing so?
Sajid Javid
One thing we know is that my hon. Friend is not short of chutzpah, and I am glad he deployed it in his former career. He is absolutely right in what he says and he makes a key point: there is only so much the Government can do. We will do that and look for ways to provide even more support, but we want more and more companies to do everything they can, too.
Bill Esterson (Sefton Central) (Lab)
The Government’s so-called support for exports has seen grants converted to loans, and the sudden closure of the business growth service. Businesses supported by that service grew four times faster than other businesses, and the scheme created 83,000 jobs and added more than £3.5 billion to the national economy. As one BGS mentor says,
“the service’s closure doesn’t make sense considering its huge success and may prove detrimental to Britain’s economic health.”
What message does the closure of the BGS send to businesses that want to grow? Given the outstanding record of success, does the closure of the service not show a complete lack of understanding by this Government of what works on support for exports?
Sajid Javid
I am glad the hon. Gentleman has raised the issue of the BGS, because although it was a good fee-earner for consultants, there is very little evidence to show that it helped businesses to grow. [Interruption.] There is little evidence that it was the best way to help those businesses. The best way to help businesses is to make sure that we continue to have a growing economy—our economy is growing faster than those of all our rivals—so one thing he can do is support our long-term economic plan. We are also providing funding to 39 local enterprise partnerships—all the LEPs—through growth hubs, which they can use for localised support, including export opportunities.
Tommy Sheppard (Edinburgh East) (SNP)
6. What assessment he has made of the potential cost to businesses of implementation of the apprenticeships levy.
The Minister for Skills (Nick Boles)
Employers with a payroll bill of more than £3 million a year will be required to pay the new apprenticeship levy. It will raise £3 billion in 2019-20 to support apprenticeship training throughout the UK, including in Scotland.
Tommy Sheppard
We do, of course, hope that the apprenticeship levy will provide the same opportunities for young people south of the border as the 25,000 who started a modern apprenticeship in Scotland this year have. Is the Minister aware of the Association of Employment and Learning Providers’ concerns that the number of small and medium-sized enterprises affected by the levy is likely to be much greater than originally thought? Will he give an undertaking to provide clear and early guidance to those, well in advance of implementation?
Nick Boles
I am delighted that the hon. Gentleman is proud of the 25,000 modern apprenticeship starts in Scotland, just as we are proud of the half a million starts we have had in the past year in England. This would suggest to me that we can both take pride in our commitment to apprenticeships. I hope he will welcome the fact that the apprenticeship levy will be generating resources, some of which will pass to Scotland to enable it to fund what I hope will be a dramatic expansion in the number of its apprenticeships.
Hannah Bardell (Livingston) (SNP)
As the Minister will appreciate, the oil and gas industry faces distinct challenges at the moment. I know from my engagement with companies in the sector that there is significant concern that this levy may represent a second charge, with many oil and gas companies already paying levies to industry trading bodies. It also represents an additional cost to these companies at a time when controlling business costs is of paramount importance. Will he commit to meet me, along with my colleagues and a delegation from the industry, to hear their concerns and discuss how the apprenticeship levy scheme can be designed to take account of these circumstances?
Nick Boles
Of course I would be delighted to meet the hon. Lady and that delegation, but I will be asking them what they thought of her party’s plans for Scotland’s economy, which rested on oil prices at $100 a barrel and would now see an independent Scotland entirely bankrupt and probably scuttling to the International Monetary Fund.
Barbara Keeley (Worsley and Eccles South) (Lab)
7. What steps he plans to take to make the efficiencies and savings in adult skills set out in the “Spending Review and Autumn Statement 2015”.
The Minister for Skills (Nick Boles)
We are protecting funding for adult education at £1.5 billion per year in cash terms. We are extending advanced learner loans to more adult learners and increasing spending on adult apprenticeships to £1.5 billion by 2019-20. As my right hon. Friend the Secretary of State says, this means that total funding for adult skills training will be 36% higher in the last year of this Parliament than in the first.[Official Report, 5 January 2016, Vol. 604, c. 2MC.]
Barbara Keeley
Salford city college was one of more than 100 further education colleges that wrote to the Prime Minister to protest at repeated year-on-year real-terms funding cuts to adult skills since 2010 amounting to 40%. Despite the promise not to cut adult skills funding for FE colleges, Treasury documents say that there will be £360 million of savings and efficiencies, as my hon. Friend the Member for Denton and Reddish (Andrew Gwynne) mentioned. After years of savage cuts, how can that be achieved?
Nick Boles
Like many other colleges, the hon. Lady’s college wrote to the Prime Minister before the spending review in response to the shroud waving by the Opposition, who predicted a 25% to 40% cut in the adult skills budget. If the hon. Lady had taken the trouble to attend my right hon. Friend the Chancellor’s spending review statement, she would have heard that he was protecting it in cash terms while increasing the funding for apprenticeships, which her college and others could bid for. If she spoke to her college, she would discover that, like all other colleges, it is pleasantly surprised by the funding settlement.
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
Any credible long-term economic plan would recognise the critical importance of adult reskilling, but the Government have systematically cut adult skills by 40% since 2010, including a 24% cut in February this year in non-apprenticeship funding. That is probably why the Chancellor ducked out of making any reference to the further cuts in his autumn statement, leaving it to his Blue Book to talk about £360 million of efficiencies. Will the Minister say precisely what the £1.5 billion of core funding that he talks of is made up of? Does it include loans to over 25-year-olds, 50% of which we know will not be taken up?
Gordon Henderson (Sittingbourne and Sheppey) (Con)
8. What steps his Department is taking to establish a further education college in Sittingbourne.
The Minister for Skills (Nick Boles)
The House is making me earn my salary today.
We have launched a process of locally-led area reviews to consider each area’s skills needs and plan how further education colleges and sixth form colleges can best organise themselves to meet them. The Kent review is due to start in November 2016.
Gordon Henderson
I welcome the review. Sittingbourne is the largest town in Kent without its own FE college. However, we have a unique opportunity to change that. May I invite the Minister to visit the Swale skills centre in my constituency to learn about how, with the right help, it could easily and cheaply be extended into a small college?
Nick Boles
I have had a message from the Whips saying that they would be only too delighted for me to do further visits to hon. Members’ constituencies, so I would be delighted to visit my hon. Friend’s constituency. We do not hear the Opposition celebrating when new institutions open, including the Swale skills centre, which was set up by a very successful academies trust that is already doing a great job of running three local schools.
Kate Hollern (Blackburn) (Lab)
9. What discussions he has had on the effect of freezing the threshold at which graduates repay their student loans.
The Secretary of State for Business, Innovation and Skills and President of the Board of Trade (Sajid Javid)
I consulted on the proposal to freeze the student loan repayment threshold and received responses from a wide range of interested parties. I considered those responses, as well as a detailed impact analysis, before deciding to proceed with the freezing of the threshold.
Kate Hollern
Does the Secretary of State agree that if a commercial company had made a retrospective change to a contract in this way, costing students £6,000 in the process, there would likely be an investigation? Does he accept that, in doing so, he breached the trust of former, current and future students?
Sajid Javid
What I accept is that these were the right set of changes. I considered the responses to the consultation carefully. It is important that we strike the right balance between the interests of the students, making sure that all who have the ability have the opportunity to go to university, and the interests of the taxpayer, ensuring that we have an affordable, sustainable funding system. That is exactly what the changes bring about.
Andrew Bridgen (North West Leicestershire) (Con)
Despite the negative comments from the Opposition, can the Secretary of State confirm that this year record numbers of young people secured places at university, including record numbers of children from disadvantaged backgrounds?
Sajid Javid
My hon. Friend is right. That is true of England. We have seen a record increase to 382,000 people in the past year, and the number of students from disadvantaged backgrounds has gone up from 9.5% to 18.2% in the past five years. In Scotland we have seen a fall in the number of students because Scotland does not have a funding system that allows all who want to go to university to do so.
Wes Streeting (Ilford North) (Lab)
Given the report in The Independent on Sunday that Ministers in the Cabinet Office are desperately trying to find ways to increase the cap on tuition fees without proper debate and a vote in this House, can the Secretary of State confirm that any attempt to increase the cap on tuition fees will come back to this House for a full debate and vote? Can he also confirm that Government proposals in the autumn statement to extend tuition fees to nurses, midwives and students of allied health subjects will be subject to a proper debate and a vote in this House?
Sajid Javid
If the Government do decide to change the caps on tuition fees, there will, of course, be a debate in this House.
Paul Blomfield (Sheffield Central) (Lab)
Does the Secretary of State agree that retrospectively changing the terms of a contract is, in effect, mis-selling? Will he guarantee that in this Parliament there will be no further changes to either thresholds or interest rates?
Sajid Javid
The changes in question are entirely lawful. That is the advice that I received and it is perfectly consistent with the aims. Hon. Members should remember that the loans that are provided are on significantly better terms than those that are available commercially, and they achieve the objective of allowing all those who wish to go to university and who have the ability to do so.
Andrew Stephenson (Pendle) (Con)
10. What steps he is taking to support the aerospace industry.
Steve Double (St Austell and Newquay) (Con)
14. What steps he is taking to support the aerospace industry.
The Minister for Small Business, Industry and Enterprise (Anna Soubry)
I was delighted that in the spending review the Government committed a further £900 million of funding for aerospace research and development, supported by the Aerospace Technology Institute. That means that this Government will invest almost £2 billion in aerospace research over 13 years to 2025-26, so our world-leading aerospace industry can stay at the forefront of development and capitalise on the estimated £3.6 trillion market for new aircraft that will be needed over the next 20 years.
Andrew Stephenson
I recently met Mark Porter and Jon Brough, the trade union representatives at Rolls-Royce’s two sites at Barnoldswick in my constituency. They welcome the continuation of Government support for the aerospace growth partnership in the comprehensive spending review. However, they remain concerned about the outsourcing of high-value engineering jobs to low-cost countries. What more can my right hon. Friend do to address this concern?
Anna Soubry
I am more than happy to meet my hon. Friend to discuss the concerns of all those he has met with. Rolls-Royce, along with the aerospace sector as a whole, is a major contributor to the United Kingdom economy, so we get how important it is. That is why we have protected and, indeed, extended the investment that we are making in research and development.
Steve Double
The recent announcement of the expansion of the Aerohub enterprise zone in Cornwall to include the Goonhilly earth station has been keenly welcomed in Cornwall. Does the Minister agree that this creates a great opportunity for Cornwall to be awarded the location of the UK spaceport, which would provide a huge bonus to the Cornish economy?
Anna Soubry
I am sure my hon. Friend will continue to make that case. I have to say that a number of other airports are in the running and we aim to launch the selection process next year. We have heard the great news about the launch today and Major Tim going up into space. Ground control can report that the UK space sector has almost doubled to £11.8 billion—[Interruption.] I know it is the festive season, but I think it is most unfortunate that Opposition Members are singing. It is not good. I hope they might cheer the fact that the sector has almost doubled to £11.8 billion in just seven years and employs 37,000 people.
Mr Speaker
Order. Sing, but no Member of this House can match David Bowie—highly relevant as far as ground control is concerned.
Angela Smith (Penistone and Stocksbridge) (Lab)
Rolls-Royce is of strategic importance to our aerospace industry, not just in Derby but in Sheffield and Bristol. What are the Government prepared to do to safeguard that capacity, which is increasingly in the news at the moment, in order to ensure that we not just invest in but safeguard the future of the industry so that the UK stays at the forefront of aerospace manufacturing globally?
Anna Soubry
We should of course mention the importance of Rolls-Royce to a great city like Derby; I say that, obviously, as a Nottinghamshire MP. In all seriousness, we are monitoring the situation carefully. We recognise the huge importance of the role that Rolls-Royce plays in our economy. It is really important that we do not talk things down. [Interruption.] Forgive me, but there is too often a tendency among Labour Members, not necessarily the hon. Lady, to talk things down. It is really important that we do not do that and that we continue to support Rolls-Royce.
Mr Dennis Skinner (Bolsover) (Lab)
In order to stop Rolls-Royce falling into the hands of the Chinese, let us say, why do not this Government take Rolls-Royce back into public ownership?
Anna Soubry
Because—I know the hon. Gentleman will have trouble in understanding this—this is 2015. We are not back in the ’60s and the dark days of the ’70s, and we have a long-term economic plan that delivers, unlike his plan, which would be an absolute disaster for our country.
Yvonne Fovargue (Makerfield) (Lab)
As we have heard from my hon. Friends, we have been watching the recent developments in relation to Rolls-Royce very closely, not only because of the implications for national security but because it is the biggest single employer for Britain’s aerospace sector. As the Minister said, the global market for new aircraft is predicted to be worth £3.6 trillion in the next 20 years, so we welcome the investment in the Aerospace Technology Institute. However, is it not about time that Ministers considered developing an industrial strategy instead of continuing the current piecemeal approach?
Anna Soubry
I am not going to repeat all the things I have said about our continuing investment. With £900 million of taxpayers’ money going into aerospace, we absolutely understand and recognise its significance. It is very easy to put on labels, but it does not matter what label we put on—it is about delivery, and that is what this Government continue to do.
Mike Weir (Angus) (SNP)
11. What funding his Department plans to allocate to research and development in the energy sector over the next five years.
The Parliamentary Under-Secretary of State for Business, Innovation and Skills (George Freeman)
As my right hon. Friend the Chancellor demonstrated in the autumn statement, the Government put investment in R and D as the top priority in our long-term economic plan. I am delighted, as I am sure that Opposition Members will be, by the announcement on ring-fencing the science budget, with £6.9 billion on science capital and £4.7 billion on revenue. In addition, the Prime Minister recently announced a 50% increase in our funding of climate finance, with £400 million over this Parliament, and we have just announced £60 million going into the energy research accelerator.
Mike Weir
Launching an investment coalition in Paris at the weekend, Bill Gates made the point that if we are to avoid global warming we have to move at full speed in developing new renewable energy technologies. To ensure that the UK plays its part, what progress have Ministers made in ensuring that the UK Green Investment Bank receives the full £3.8 billion of capitalisation and maintains its green mandate, irrespective of the future of the Government’s stake in the bank?
George Freeman
I am sure that the hon. Gentleman will welcome the Prime Minister’s announcement of £400 million extra funding. The Green Investment Bank has played the role that we envisaged in supporting the green economy, which is not an allotment economy—it now constitutes 96,000 businesses with 230,000 employees and a turnover of £45 billion for the British economy and £4.8 billion of exports. By giving the Green Investment Bank the freedom to raise money on the capital markets, we will generate more money for the green economy, which is growing under this Government like never before.
Peter Aldous (Waveney) (Con)
The North sea oil and gas sector faces significant challenges at the current time, with a need for a collegiate approach to research and development to fuel innovation and to drive down costs. To achieve this, will the Minister consider setting up a North sea oil and gas innovation centre similar to the very successful offshore wind catapult?
George Freeman
My hon. Friend makes a very interesting point. On the east coast in East Anglia, in the north and in Scotland, this country is leading in the field of offshore energy. We have just funded the offshore energy centre, but I would be happy to look at the specific idea that he recommends.
Hannah Bardell (Livingston) (SNP)
“Extremely disappointing”, “missed opportunity”, “damaging” and “disgrace” were some of the words and phrases used to describe this Government’s decision to withdraw £1 billion of funding from carbon capture and storage. Hundreds of jobs for the communities of the north-east of Scotland, and the opportunity to be at the forefront of low-carbon innovation, have now been lost. The Government will instead spend hundreds of millions of pounds on subsidising research into nuclear energy. In the light of that decision, would the Minister like to take this opportunity to explain to the people of Peterhead and the north-east specifically how he has supported them to be world leaders in innovation?
George Freeman
It is a pleasure to follow that speech. I will happily repeat the figure I just gave: the Prime Minister has just announced £400 million of extra funding for energy finance. We have just made announcements on onshore research. One of the lessons for Scotland is to reduce its dependence on public sector funding. The truth is that, under the renewables obligation for offshore wind, 28% of the funding went to Scotland—that is £560 million—when it represents only 10% of bill payers. We need to support the green economy in Scotland, just like we are doing in the rest of the country.
David Mowat (Warrington South) (Con)
In the spending review, a major energy investment of £250 million was announced for small modular reactors. That was warmly welcomed in the north-west and it will make a big difference to our ability to meet our climate change targets. It is crucial that the UK owns the intellectual property rights that result from that technology. Will the Minister and his colleagues in the Department of Energy and Climate Change make sure that that is the case?
George Freeman
My hon. Friend is something of an expert on those matters and I will happily look into the very important point he makes. One of the benefits of our support for the green economy—which, as I have said, is now a £45 billion sector in this country—is that we are generating the leading technologies in 21st-century green energy. I will happily look into the specific points he makes.
Alex Chalk (Cheltenham) (Con)
12. What steps he is taking to tackle late payment to small businesses.
The Minister for Small Business, Industry and Enterprise (Anna Soubry)
The Enterprise Bill, which is going through the other place, will create a small business commissioner, and one of his or her most important roles will be to make sure, as much as possible, that the continuing problem with late payment is brought to an end. Of course, we have other measures in hand to make sure that there is reporting, but we are making good progress.
Alex Chalk
Cheltenham’s superb range of shops and small business rely for their success on people getting out from behind their computers and physically visiting local shops. Does my hon. Friend agree that local authorities should promote flexible and, above all, cheap parking wherever possible to support small businesses and shopping hubs such as Cheltenham?
Anna Soubry
I fear that, as ever, I am a bit off message. I take a radical approach to parking. As far as is ever possible, I take the view that there should be no parking charges in any towns. The car parks belong to the people—they absolutely do. There are times when a local authority wants to put in car-parking charges—a very good example being in Rushcliffe—to make sure that people do not abuse them, but, as far as possible, we should be supporting our great town centres and our great small businesses. We should not charge people for the luxury of parking in their own hometowns.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
In the spirit of Christmas, may I invite the whole ministerial team to come to Huddersfield, where they can learn about spinning and weaving? I can also arrange for them to have a wonderful “Made in Huddersfield” worsted suit, just like the one I am wearing. They can also meet small businesses and the Textile Centre of Excellence and talk about all the pressures on small business and the problems they face because the Government want to take us out of Europe, which will stop us exporting to the rest of the world.
Anna Soubry
It was all going so well—I was going to be a little Christmas fairy. Of course, everybody knows my views, and, indeed, those of my Prime Minister, on the European Union: we want to stay in a reformed Union and make sure that we get those reforms. In the spirit of Christmas, I would be delighted to go to Huddersfield. I could talk about my family’s long-standing relationship with Huddersfield. We will do that on the basis that I will go to Huddersfield if the hon. Gentleman will come to Broxtowe, to Beeston in particular.
Clive Efford (Eltham) (Lab)
15. What discussions he has had with the Minister for the Cabinet Office on supporting the cyber-resilience of UK businesses.
The Minister for Culture and the Digital Economy (Mr Edward Vaizey)
I am delighted to say that I talk about cyber-resilience a lot with the Minister for the Cabinet Office. Only the other day, we were saying how pleased we were to hear the Chancellor announce the doubling of the cyber-security budget to almost £2 billion.
Clive Efford
I am delighted that the Minister has more than doubled the budget, but only 10% of it goes on consumers, the police force and small businesses. What is the Minister doing to encourage small businesses that are time-poor, meaning that they are not able to engage with this sort of administration? What is he going to do for business in Eltham, to ensure that they are safe online?
Mr Vaizey
I did not double the budget; it was the Chancellor. It is important—particularly for one’s career—to give him credit when he does such things. I take the hon. Gentleman’s point very seriously. We have a fantastic scheme called the cyber essentials scheme, which allows small businesses and large businesses to get a certificate to show that they have been through a process to increase their cyber-security.
Richard Arkless (Dumfries and Galloway) (SNP)
16. What steps he is taking to improve productivity in the economy.
The Secretary of State for Business, Innovation and Skills and President of the Board of Trade (Sajid Javid)
The Government are working hard to deliver the ambitious measures outlined in our productivity plan. We will drive productivity growth throughout the UK by encouraging long-term investment and promoting a dynamic economy.
Richard Arkless
Productivity has been the Achilles heel of this Government’s economic policy. Comparisons with G7 countries are poor, and the figures are even worse when compared with those for smaller to medium-sized and—dare I say?—independent countries. Is it not the case that the Government have been completely obsessed with austerity, and cuts and have completely neglected productivity, internationalisation and innovation, which is the fairer, more progressive way to raise tax receipts and reduce the deficit?
Sajid Javid
No, that is absolutely not the case. The hon. Gentleman is right that there has been a long-running productivity issue in our country under successive Governments. That is why we have published the ambitious productivity plan, dealing with issues such as skills, infrastructure and innovation. In the past year, we have seen a 1.3% year-on-year increase in output per hour, which is very encouraging.
Rob Marris (Wolverhampton South West) (Lab)
After five years in charge, it is time the Government took some responsibility. Why has productivity stalled for the past five years?
Sajid Javid
Because after 13 years of the Labour party being in charge, we had the biggest recession our country had seen in almost 100 years and it has taken time for the country to recover from that. As I have said, productivity is on the rise.
Diana Johnson (Kingston upon Hull North) (Lab)
17. What discussions he has had with the Secretary of State for Culture, Media and Sport on improving competition in the broadband market.
The Minister for Culture and the Digital Economy (Mr Edward Vaizey)
It is nice to be back, Mr Speaker. We have a very competitive broadband market. I was thinking about that the other day when I went to York to see TalkTalk delivering fibre to premises. I met the chief executive of Virgin Media, which is investing billions in fibre. There has been an announcement from CityFibre about its acquiring some of KCom’s holdings. On Friday, I will go to see Gigaclear delivering broadband to homes in Epping Forest. We have a very competitive market.
Diana Johnson
Ofcom has confirmed to me that Hull is the only city in the country without competition for small businesses and households, and the only city among the worst 20 areas for superfast broadband access. This is really affecting small businesses in Hull. Will the Minister tell me how much of the £530 million that the Government have allocated for investment in superfast broadband will be allocated to Hull?
Mr Vaizey
The hon. Lady knows full well that Hull has traditionally had one, in effect municipal, provider—Kingston Communications, which has been privatised—which is why Hull has white phone boxes, rather than red ones. I am pleased to say that KCom is investing in broadband for the whole of Hull without any need for a public subsidy.
Kate Hollern (Blackburn) (Lab)
T1. If he will make a statement on his departmental responsibilities.
The Secretary of State for Business, Innovation and Skills and President of the Board of Trade (Sajid Javid)
The recent spending review delivered a strong settlement for many of the Department’s sectors, focusing support on areas that drive up productivity across the UK.
As we have heard, in the past hour Major Tim Peake has successfully blasted into orbit. This morning, the Government launched their space policy, which has achieved lift-off. Launched a short time ago in a museum that is not far, far away, the policy document shows that there are no limits to the UK’s ambitions in this area. To mix intergalactic metaphors, we want to boldly go to infinity and beyond, and our new policy will make it so.
Kate Hollern
As everyone knows, if we are to improve productivity, we need a good, strong education system. Will the Secretary of State give a categorical assurance that further education institutions, such as Blackburn College in my constituency, will not receive a real-terms funding cut as a result of the cash-terms freeze in adult and 16-to-19 funding?
Sajid Javid
I agree with the hon. Lady on the issue of productivity and the need to boost skills. There will be area reviews, so I cannot make a promise about any particular institution. However, as the Minister for Skills has said, there will be an increase in FE funding of more than 35% in real terms over the lifetime of the Parliament. In the hon. Lady’s constituency, there has been a 75% increase in apprenticeship starts during the past five years, which I am sure she welcomes.
Steve Double (St Austell and Newquay) (Con)
T3. The Eden Project in my constituency has run a successful apprenticeship in horticulture for the past year. Horticulturalists will become more and more important in meeting our increasing demand for food. What support can the Minister provide to promote horticulture as a worthwhile career for young people?
The Parliamentary Under-Secretary of State for Business, Innovation and Skills (George Freeman)
My hon. Friend makes an excellent point. We are supporting the horticulture industry under the UK agritech strategy. Indeed, I recently opened a horticultural waste reduction facility. The horticulture sector is leading in the UK on low water, low plastic and low energy farming systems, and on novel uses of insects to avoid the use of pesticides and hydroponics. It is an innovative sector that is developing interesting careers and contributing to our growing agritech economy.
Ms Angela Eagle (Wallasey) (Lab)
May I start by adding our best wishes and congratulations to Major Tim Peake, who will be the first British astronaut to visit the international space station, ahead of his Principia mission? May I also take this opportunity to pay tribute to Helen Sharman, who was the first Briton to go into space? Let us all pledge to do our bit to inspire the next generation of scientists, engineers, mathematicians and explorers, in the same way that the moon landings inspired my generation.
Most businesses understand that nearly half our exports and 3 million jobs are linked to our membership of the European Union, and most believe, like I do, that it is in the interests of the UK to remain a member. Yesterday, the right hon. Member for North Shropshire (Mr Paterson) described the Prime Minister’s negotiations as “froth and nonsense” and the Prime Minister’s approach to his endless renegotiations has been described today as a “shambles”. Does the Secretary of State agree with UK business or with the Eurosceptics on his side of the House?
Sajid Javid
I associate myself with the hon. Lady’s comments about Major Tim Peake’s mission. It is an inspiration for us all and will hopefully get more young people interested in science.
On the European Union, I agree with almost all the businesses I have met because they want to see reform. They want to see changes in our relationship with the EU. They want the EU to be more competitive, they want to be able to make easier, quicker and deeper trade deals, they want a deeper single market and they want less bureaucracy. I am sure that the hon. Lady agrees with that too. That is exactly what we are fighting for.
Ms Eagle
We all want the UK to remain in a reformed European Union, but the Secretary of State’s Eurosceptic interests are well known. It is not like him to be so shy and timid about them, so let ask him more directly: is he prepared to resign from the Cabinet to fight for Brexit in the forthcoming referendum? If he cannot answer that question, how can he claim to be representing the interests of British businesses, which overwhelmingly want to stay in?
Sajid Javid
When it comes to divisions and resignations, it is her party that the hon. Lady should be worried about. I am prepared to fight for the reforms that I just outlined. Those are the reforms that everyone wants to see. We will fight for them tooth and nail, and then we will put the question to the British people and let them decide.
Nigel Huddleston (Mid Worcestershire) (Con)
T4. The Worcestershire growth fund will provide grants of up to £100,000 to businesses that are looking to expand and create jobs in Worcestershire. Will the Secretary of State join me in encouraging as many businesses as possible across Worcestershire to apply for the first round before the deadline this Friday?
Sajid Javid
In the short time that my hon. Friend has been a Member of Parliament, he has done a lot to champion small businesses in Worcestershire. I have seen that at first hand. The Worcestershire growth fund represents an excellent funding opportunity and I certainly join him in encouraging companies in his constituency and mine to apply.
Mr Gavin Shuker (Luton South) (Lab/Co-op)
T2. The illegal money lending team has commenced 330 prosecutions against illegal loan sharks and had £63 million written off for the most vulnerable in our communities. The decision to cut a third of its £3.6 million budget may not have crossed the Secretary of State’s desk at the time, but he has had plenty of time to review the decision and it will have a big impact, so why does he continue to dodge questions about this short-sighted cut?
The Minister for Skills (Nick Boles)
We are not dodging any questions. If the hon. Gentleman had attended Prime Minister’s questions last week, he would have heard my right hon. Friend the Chancellor say that he was looking at the possibility of introducing a levy to continue to fund this action against loan sharks. That is the Treasury’s policy to take forward and the hon. Gentleman will have to ask the Treasury if he wants further details about it.
Peter Heaton-Jones (North Devon) (Con)
T5. A few days ago in North Devon, I met the new cohort from the Petroc College Care Academy, which has a unique programme providing part-time apprenticeships at the local healthcare trust. Will the Minister join me in congratulating them, and does he agree that it is an important programme for training the next generation of our healthcare professionals locally?
George Freeman
I absolutely join my hon. Friend, and I thank him for raising the matter. The Care Academy programme is doing great work, and Petroc College in his constituency is pioneering 18-week placement courses so that young people can discover the interesting range of careers in the health and care sector. It supports the local economy as well as our national skills base.
Carolyn Harris (Swansea East) (Lab)
T6. Several organisations, including Electrical Safety First, welcomed the recent product safety review conducted by the Department and headed by Lynn Faulds Wood. We must work to prevent ineffective product safety recalls and improve traceability better to protect customers and business in the UK. When will the Department publish the review?
The Minister for Small Business, Industry and Enterprise (Anna Soubry)
I have met Lynn Faulds Wood and I thank and commend her for her work. I will have a further meeting with her to see when we can publish the review and make the progress that we all want.
Michael Tomlinson (Mid Dorset and North Poole) (Con)
T7. Will the Secretary of State update the House on the objectives of his recent visit to India, and how best local businesses in my constituency can tap into that market?
Sajid Javid
Yes, I will. The recent visit was to build on the momentum generated by Prime Minister Modi’s recent visit. Along with the Minister for Universities and Science, I went to India to promote getting more Indian students to come to the UK and study. I took 30 vice chancellors, including two from Dorset. That is just the kind of export that we want.
Ms Tasmina Ahmed-Sheikh (Ochil and South Perthshire) (SNP)
T8. Last week, The British Chambers of Commerce downgraded its forecast for overall GDP growth, citing weaker than expected trade. On Thursday, the Office for National Statistics released data, which showed that the gap between imports and exports grew from £3.1 billion in September to £4.1 billion in October. Will the Secretary of State update the House on the measures that he is taking to support export growth, given that his current plans are clearly not working?
Sajid Javid
The hon. Lady knows that there has been export growth in the past five years, including to some of the fastest growing markets in the world such as India and China, which came up earlier. We obviously need to do more, and that is why we have several measures in place, some of which I have mentioned. Those kinds of changes, such as increases in exports, are leading to falls in unemployment throughout the country and generating jobs, including a 53% decline in jobseekers’ allowance claimants in her constituency.
Nicola Blackwood (Oxford West and Abingdon) (Con)
T10. As Tim Peake blasts off today, we are reminded again of the exponential value of science funding well spent. For that reason, the Science and Technology Committee intends to continue our work of testing science spending plans. Will the Business Secretary reassure the House that the welcome increase in science funding will be ring-fenced? Will he accept our invitation to appear before the Committee in January to go over that in detail?
Sajid Javid
First, I accept the invitation—thank you very much. I also take the opportunity to commend my hon. Friend for her leadership of the Science and Technology Committee and the way in which has made the case so well for science. I can confirm that the ring fence is protected in real terms, not just cash terms. I also confirm our manifesto commitment to spend £6.9 billion on science infrastructure over the next six years. I am sure that she will agree that, this Christmas, batteries are included.
Andy McDonald (Middlesbrough) (Lab)
T9. I previously raised with the Secretary of State the Teesside Collective’s industrial carbon capture and storage ambitions, which will not only contribute massively to the climate change agenda, but secure existing industries and attract investment. In the light of the Paris agreement, will he meet me and industrialists leading that key initiative to explore how we might bring that important project to fruition?
Anna Soubry
I hope that I do not disappoint the hon. Gentleman, but I am more than happy to have a meeting with him. He knows the terms on which we always have our meetings: not to shout at me. [Interruption.] Only in the House. I hope that he will join me in congratulating the Secretary of State for Energy and Climate Change on her outstanding achievement on behalf of our nation in playing a full and important role in securing the excellent way forward to ensure that the planet that we leave for our children will be better than the one that we inherited. Yes, I will have the meeting.
John Stevenson (Carlisle) (Con)
As the Minister well knows, Carlisle and Cumbria have experienced devastating floods recently. As part of the recovery, it is vital that confidence is restored as quickly as possible, especially in the business community. Will the Minister confirm that she and the Department will do everything to support Cumbrian businesses, and wherever possible, ensure that people know that Carlisle and Cumbria are open for business?
Anna Soubry
Yes indeed, and I pay tribute to my hon. Friend and all Members of Parliament affected by this issue for their great work. I will go to that area on Tuesday, and I hope to visit Carlisle as well as Cockermouth, Kendal and Keswick if possible. I am delighted that we were able to secure £5 million funding for all businesses affected by the flooding, which will make a huge improvement. We have done that very quickly, and the money will be available quickly and—most importantly—in time for Christmas, so that all those businesses and shops can be open for businesses.
Mr Iain Wright (Hartlepool) (Lab)
The Secretary of State mentioned simplifying and clarifying the business environment in this country, as well as paring back bureaucracy and identifying a further £10 billion reduction in red tape over this Parliament. Why did the autumn statement propose that small businesses should file tax returns four times a year, rather than annually? Will the Secretary of State outline how that helps small businesses to reduce their costs and burdens? To keep the “Star Wars” quotes going, “I’ve got a bad feeling about this.”
Sajid Javid
I have not heard that quote from “Star Wars”. [Interruption.] It is really important that we keep deregulating for small businesses, and that was achieved during the previous Parliament. As Chair of the Business, Innovation and Skills Committee, the hon. Gentleman knows that that measure is a net target, and because of the Enterprise Bill, and many other measures, I am confident that we will see huge net deregulation, running into the billions, for businesses over the lifetime of this Parliament.
Richard Fuller (Bedford) (Con)
The Business, Innovation and Skills Committee had a discussion this week about the phrase “industrial strategy”, which seems to mean all sorts of things to different people. I do not know what that phrase means, but I know that if I did, I would be against it. Will the Minister reassure the House that while he is Secretary of State, this Government will not go about picking winners?
Sajid Javid
Like my hon. Friend, the Government believe passionately in free enterprise. Free enterprise has motored this economy for decades, and it will continue to lift people out of poverty. We do have a strategy—it is called the long-term economic plan.
Stephen Doughty (Cardiff South and Penarth) (Lab/Co-op)
I am sure that the space Minister will praise the foresight of the previous Labour Government who established the UK Space Agency. Given that Tim Peake’s incredible mission is launching today, will she say a little more about how she will spread inspiration from that mission to a budding generation of new space scientists, engineers and astronauts, including in Cardiff South and Penarth?
Anna Soubry
Tim Peake is going to the International Space Station, but I mentioned seven years because—as you know, Mr Speaker—I am not prone to partisanship, and I will always give credit where it is due. I wish that Labour Members would do the same.
We have made huge progress to help great industries such as the steel industry, including our announcement on energy intensive industries, but I notice—let me get this point in when I have the opportunity, Mr Speaker—that nobody has mentioned that or said how good it is. The hon. Gentleman and the hon. Member for Wallasey (Ms Eagle) are right to say how important it is that we inspire the younger generation—boys and girls—about great future career opportunities, especially in engineering.
Jo Churchill (Bury St Edmunds) (Con)
Will the Minister update the House about life science clusters as a way to stimulate start-ups, excellence and growth in the sector? Does he have any plans to use devolution city deals for such clusters?
George Freeman
My hon. Friend makes an important point, and around the country—not just in Cambridge, Oxford, and London MedCity, but in the Northern Health Science Alliance and the Scottish belt—the UK life science industry is building clusters of excellence and growth for the benefit of our citizens. I am holding discussions with the Chancellor and the Department for Communities and Local Government about how the devolution package could drive and support greater development of those health clusters around the country.
Jim Shannon (Strangford) (DUP)
The Minister referred earlier to moneys that have been set aside by the Government for research and development in the aerospace industry. In my constituency, 6,500 people are directly employed by Magellan and Bombardier, and double that number are subcontracted. What discussions has the Minister had with the Northern Ireland Assembly to ensure that we can be part of that research and development?
Anna Soubry
I have not had those discussions, but I am more than happy to hold them with the hon. Gentleman—he knows my door is always open, especially to him. I recognise the huge importance of Bombardier, and the role that it plays in his constituency and the whole of Northern Ireland.
Several hon. Members rose—
Petition
(8 years, 4 months ago)
Commons ChamberRead Full debate Read Hansard Text
Gavin Williamson (South Staffordshire) (Con)
My constituent Sian Mitchell moved to the United States last year, following her engagement and marriage to an American citizen. Sadly, shortly after the birth of her son earlier this year, her marriage fell apart. Her multi-millionaire husband, Mr Angus Mitchell, has taken out court orders preventing Sian from taking her child out of the State of California until proceedings have been resolved, making it as difficult as possible for her to bring up her son in the way she wishes. Sian is away from her family and relies on their emotional support during this extremely difficult time. She is desperate to return home to the United Kingdom with her child to allow her family to have the chance to meet this little boy for the first time. I therefore present the petition on behalf of 154 residents of South Staffordshire.
The petition states:
The petition of residents of the UK,
Declares that Mrs Sian Mitchell moved to the United States of America where she married a US citizen with whom she has a son; further that divorce proceedings are currently in motion and Mrs Mitchell has been ordered by the courts in California to remain in the State with her son until proceedings have been resolved; and further that the petitioners believe that the Foreign and Commonwealth Office and the Government should offer as much support and assistance to her as possible so she can return to the United Kingdom.
The petitioners therefore request that the House of Commons urges the Foreign and Commonwealth Office and the Government to make representations to the US Government and the State of California to press the issue and get a resolution to the problem at the earliest possible stage so that Mrs Mitchell can return to the United Kingdom with her son as soon as possible.
And the petitioners remain, etc.
[P001662]
Point of Order
(8 years, 4 months ago)
Commons ChamberRead Full debate Read Hansard Text
Mr Speaker
Ah! The day would not be complete without a point of order from the hon. Gentleman.
Mr MacNeil
On a point of order, Mr Speaker. I wonder whether you can help me by telling me what can be done when the Independent Parliamentary Standards Authority, which is in my view not actually independent but very partial, is obstructing an MP from doing their work? My situation involves complex travel arrangements and IPSA is obstructing my travel movements. Is there anyone who is genuinely independent who I can deal with to get beyond the kangaroo issues of IPSA? I am wasting a lot of time and effort, as are my staff, in dealing with IPSA and getting absolutely nowhere.
Mr Speaker
Order. I am very disturbed to hear that. The hon. Gentleman might be aware—if he was not, he now will be—of the existence of an informal grouping within Parliament, which includes the hon. Member for Gainsborough (Sir Edward Leigh), to which he could usefully make representations about the particular situation that he faces. I hope that he will understand that this is not something of which I can treat here and now in the Chamber.
Mr Speaker
No follow-up would ordinarily be required, but the hon. Gentleman is champing at the bit and I will give him one last chance.
Mr MacNeil
I am grateful to you, Mr Speaker. I was on that panel, with the honourable member for Gainsborough, during the last Parliament, but I am not aware of its continued existence in this Parliament.
Mr Speaker
My understanding had always been that there was an opportunity for Members to make such informal representations. The Chair cannot deal with specific cases at all, and the Chair is in no position authoritatively to comment on particular circumstances from the Chair, especially when given no advance knowledge of them. If the hon. Gentleman wishes to pursue the matter further, he can usefully do so outside the Chamber.
Free School Meals (Automatic Registration of Eligible Children)
(8 years, 4 months ago)
Commons ChamberRead Full debate Read Hansard Text
Frank Field (Birkenhead) (Lab)
I beg to move,
That leave be given to bring in a Bill to provide local authorities with the duties and powers required to identify and automatically register all children eligible for free school meals; to provide for an opt-out where the family wishes; and for connected purposes.
I grew up, as you did, Mr Speaker, and as did everyone in the House, in a world in which the term “progress” did not need to speak its name. It was the assumption of all of us that things could only get better. That was true not only in this Chamber and in the country but in every western society. I view the world that I grew up in rather like a train journey. The train had different compartments that reflected our social classes, particularly in England. There was a first-class compartment, as well as second, third and fourth-class compartments. The crucial thing about the train journey, however, was that we were all on board and all heading towards a better tomorrow. In the past decade or so, the last carriage, the fourth-class carriage containing the poor, has become detached from the train journey that the rest of us are on. That is happening not only here but in every western country, and it is illustrated by the rise of food banks.
Last night, in each of our constituencies, a large number of children went to bed hungry and took that hunger to school with them today. To her credit, the Secretary of State for Education is concerned about this, and about the number of children who appear to be eligible for free school meals but are getting no hot meal at the beginning of the day. She has a taskforce that is trying to spread good practice, but we all know how long it can sometimes take for good practice to be spread.
Bernard Shaw, being Irish, did not have a great deal of time for us English, except that England gave him a good standard of living. He said that if the English were promoted from inferno to paradise, they would still gather round and talk about the good old days. There is something in our culture that resists the spread of good practice. The reasons why those children go to school hungry are moderately complicated to unravel. Clearly, at the bottom of our society, there is an increase in the number of low-paid jobs, and the wages from those low-paid jobs are uncertain. The all-party parliamentary group on hunger has identified problems with benefit delivery. There are also problems—let’s face it—of families who lead such chaotic lives that they let their children go to school hungry when they have the resources to do otherwise. Some families do not do that, but clearly some families do.
The Bill takes the campaign against hunger a stage further. It will compel local authorities to use their housing benefit data to counter hunger by identifying, first of all, the 160,000 children who are eligible for free school dinners but who, for some reason, do not claim. On average, that means that, in each of our constituencies, 250 children go hungry who probably do not need to do so.
The last Government linked the school premium to eligibility for free school meals. Equally importantly, therefore, the Bill will mean that £211 million follows those 160,000 children into our schools, so schools will be better able to cope with hunger and better able to integrate those children on school trips with other children.
Mr Speaker, your office tells me that, should the House grant me leave to introduce the Bill, Second Reading is not until 22 January, but already a record number of Members—126 Members from both sides of the House with all kinds of opinion—wish the Bill to proceed. Of course, it is in the power of the Secretary of State to beat the Bill and seek the powers herself. That move would not by itself bring a happy and more prosperous Christmas to those children, but it would form a basis so that, come the new year, there will be fewer hungry children in Britain than there are today.
Question put and agreed to.
Ordered,
That Frank Field, John Glen, Mr Philip Hollobone, Alison McGovern, Andrew Bridgen, Peter Kyle, Wes Streeting, Sir Nicholas Soames, Ms Karen Buck, Stella Creasy, Heidi Allen and Mr Christopher Chope present the Bill.
Bill read the First time; to be read a Second time on Friday 22 January, and to be printed (Bill 109).
Opposition Day
(8 years, 4 months ago)
Commons ChamberRead Full debate Read Hansard Text
Climate Change and Flooding
(8 years, 4 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
15:59 - The House divided: - Ayes: 214 / Noes: 296 - Question accordingly negatived.
Kerry McCarthy (Bristol East) (Lab)
I beg to move,
That this House applauds the courage and tirelessness of the UK’s emergency services, Armed Forces and volunteers who are working day and night to protect people from the damaging floods; condemns the reckless cuts to flood defence funding made by the Government, which have left communities more vulnerable to extreme weather; notes that 600 people were evacuated from their homes in Hawick due to flooding, and hopes the Scottish Government will urgently invest additional funds to enhance flood protection schemes in Scotland; further notes the increasing frequency and intensity of storms in recent years and their consistency with the warnings of Britain’s leading climate scientists regarding the impact of climate change; supports the outcome of the UN COP21 conference in Paris, but recognises that international cooperation and ambition to reduce greenhouse gases and invest in clean energy technologies must be increased if global temperature rises are to be limited and the goal of climate safety kept within reach; expresses concern at the Government’s decisions to cut investment in carbon capture and storage technology, privatise the Green Investment Bank without protecting its green mandate, reduce funding for energy efficiency and solar energy and block the growth of wind energy, which all jeopardise the future of Britain’s important low-carbon industries; and calls on the Government to institute a thorough climate risk assessment that considers the implications of the Paris Summit for future flood risk.
Although the climate deal reached in Paris at the weekend gives cause for optimism that the world is facing up to the global threat of climate change, the recent floods have brought home to us the urgency of the situation here in the UK. Climate change is already happening here, and people need not just warm words from the Government, but action.
Kerry McCarthy
May I get into my stride a little bit, and then give way? That was a premature intervention.
For the people of Cumbria, these were the third major floods in a decade. In 2009, they were told that the rainfall was unprecedented and that it was a once-in-a-century event, and yet just six years later, rainfall records in the county were again broken, causing devastation and heartbreak in the run-up to Christmas.
Flooding is already rated as the greatest climate change risk to the UK, and the Select Committee on Energy and Climate Change has warned that the frequency and magnitude of severe flooding across the UK is only going to increase. Periods of intense rainfall are projected to increase in frequency by a factor of five in this century. Indeed, the most recent Met Office analysis suggests that global warming of 2°—bear in mind that Paris does not limit us to 2°—would increase the risks of extreme flood events in the UK by a factor of seven. It is not enough to respond to the flood risk simply by focusing on building more flood defences. We need to look at how we can reduce the risk through improved land and river management, and we need to minimise the future risk of floods and other extreme weather events by tackling climate change.
We welcome the Paris accord. Nearly every country around the globe has committed to: reducing carbon emissions, building a carbon-neutral global economy, trying to limit temperature rises to 1.5°, and to reviewing our ambitions every five years. Richer nations are recognising their responsibilities to developing countries with the climate finance provisions. That is all very welcome and will make a positive difference to climate safety, but it would be complacent to suggest that the Paris accord on its own is enough.
Caroline Lucas (Brighton, Pavilion) (Green)
The hon. Lady is making a strong case. As she will have heard from Paris, from civil society and from the countries that are most vulnerable to climate impacts, about 80% of known fossil fuel reserves need to stay in the ground if we are to have a hope of avoiding dangerous climate change. We need a global transition to 100% renewables by 2050. I wonder if she could say whether she agrees with that.
Kerry McCarthy
It is very important that we make progress on that. As I will come on to later in my speech, the fact that the Government’s policies seem to be moving away from encouraging renewables—indeed, harming the renewables sector to a very high degree—makes it very difficult for us to make the transition from fossil fuels, which is something we very much want to see.
Angela Rayner (Ashton-under-Lyne) (Lab)
Does my hon. Friend agree that cuts to renewable energy threaten both our environment and the economy? In my constituency, Energy Gain UK is a successful local renewables business, which has grown from nothing in four years to having 10 staff and apprenticeships. The drastic cuts to feed-in tariffs mean it may be forced to close, which makes no sense either to the environment or to the economy.
Kerry McCarthy
I entirely agree. The renewables sector needs certainty and it has had the rug whisked away from underneath it. There is some incredibly innovative work being done. I visited Ecotricity in Stroud yesterday, to hear about Dale Vince’s proposals not just for building on his excellent work in the renewables sector but for going far beyond that. We must encourage the sector. This is where the high-tech, high-skilled, well-paid jobs of the future are and the Government ought to be doing more to encourage them.
We must acknowledge that the individual pledges made at Paris do not add up to a commitment to keep temperature rises below 2°. We must keep asking what more we can do by way of mitigation and consider what further adaptation to climate change is needed. Domestically, it is clear that the UK is not doing enough. Contributing to the global climate fund does not mean the UK can absolve itself of all responsibility, or pass the buck to developing nations.
While the international community is moving forward, the UK has gone backwards. The Government have axed the carbon capture and storage fund, worth billions of pounds. They have blocked new wind farms and cut energy efficiency programmes drastically by 80% and they propose cutting support for solar power by 90%. They are also selling off the UK Green Investment Bank without protecting its green mandate. They are increasing taxes on our more efficient cars and they are scrapping the zero-carbon standard for new homes. Their preoccupation with fossil fuels and fracking, as I mentioned, means they have threatened the future of our renewable energy industry and we have lost thousands of green jobs.
David Mowat (Warrington South) (Con)
The hon. Lady says that the UK is not doing enough. Can she tell the House of one other OECD country that has reduced its carbon emissions by as much as the UK since 1990—just one other OECD country that has done that?
Kerry McCarthy
As the hon. Gentleman says, the UK has a proud record on tackling climate change, not least due to the leadership shown by my right hon. Friend the Member for Doncaster North (Edward Miliband) with the groundbreaking Climate Change Act 2008. However, we are now coasting on that historical record and we need to do much more. We are not on course to meet our targets, so we need to do more.
The chairman of the Committee on Climate Change had no alternative but to conclude last month that the Government’s existing energy policy was clearly failing, and the CBI has said that British businesses need clarity. Businesses need to know that the Government are serious about climate change and will not make superficial claims about being green, only to U-turn on key environmental policies.
Rebecca Pow (Taunton Deane) (Con)
On clarity of Government direction and jobs, I understand we have to work together on renewables, but we are setting such a good example with Hinkley Point, on the border with my constituency, which is a low-carbon energy commitment that will generate 25,000 jobs, which will be terrific for the economy and energy production.
Kerry McCarthy
I accept that nuclear is part of the mix—that is our policy—but it is not the only solution to green energy in this country, which seems to be the Government’s point of view.
Huw Irranca-Davies (Ogmore) (Lab)
Whatever the solutions, one of the key conclusions from COP 21 is that, in order to drive down from 3.5° to 2.7°, 2° or 1.5°, the UK will have to reset its rest—as it has been phrased. We need to do more faster and with greater urgency, and that is exactly what Lord Deben and the CCC have said. Does she agree that, whatever the solutions, one of the most important things is for the Government to accept the fifth carbon budget and narrow the gap with the fourth carbon budget?
Kerry McCarthy
I agree entirely with my hon. Friend. There is almost a consensus that the UK needs to do more, go faster and introduce stronger targets.
Business needs certainty, but people in Cumbria and other flood zones need it too. Last week, I visited Carlisle and Cockermouth with my right hon. Friend the Leader of the Opposition. We are grateful to the councillors, business owners and residents who showed us around their communities and homes, and we left impressed by their resilience and determined that the Government must do all they can to rebuild their communities and reduce their future flood risk. They should never have to go through this again.
Andrew Gwynne (Denton and Reddish) (Lab)
My hon. Friend, who is right about the need for certainty, will understand the concerns of many of the flood-affected communities that the Department for Environment, Food and Rural Affairs cannot provide any certainty over future spending on flooding. Was she as shocked as I was to learn that this year’s flooding budget was £115 million less than last year’s? Is that not short-sighted of the Government?
Kerry McCarthy
I agree with my hon. Friend, as I often do. I want to say a little more about what I saw in the constituencies, and then I will answer his point.
Anyone who has been to Carlisle and Cockermouth or seen the television coverage will have been dismayed at the horrific scenes. We have seen people out on the pavements with their entire belongings, people’s homes saturated, people in temporary accommodation. There is an issue with the availability of temporary accommodation in the area. Some have been lucky enough to move into holiday cottages, but there is not much in the way of private rented accommodation to move into. We spoke to people about their massive flood insurance bills, and the thing they raised with us time and again was the excess on their policies. Now that more floods have happened, their premiums are going to go up, or they might not be able to insure their homes at all.
Mary Creagh (Wakefield) (Lab)
Does my hon. Friend share my concern that the Government’s new Flood Re scheme does not cover the insurance costs of businesses, and does she share my regret at the lack of solidarity in that scheme?
Kerry McCarthy
I agree with my hon. Friend. Small businesses mentioned that to us. The Government’s logic was that businesses could shop around in the market, but those that were hit by flooding in 2005 and 2009 and have been again now will struggle to find insurers. It is enough to put them out of business or at least force them to close for renewal and refurbishment for several months at a time.
David T. C. Davies
Does the hon. Lady agree that it would be incorrect to try to link these tragic instances of flooding to global warming because, as the Inter- governmental Panel on Climate Change says in its fourth assessment report 2007, it is impossible to link individual examples of bad weather with climate change?
Kerry McCarthy
I am not sure that was worth waiting for. Perhaps the hon. Gentleman needs to talk to the Environment Secretary, who acknowledged in last week’s statement that there was a risk. Obviously, individual episodes do not make a pattern, but a clear pattern is emerging of extreme weather events in the UK and abroad.
Between 1997 and 2010, flood defence spending increased by three quarters in real terms, but in the 2010 spending review, the coalition Government announced a 20% real-terms cut. Flood spending was slashed by £116 million in 2011-12 and again the next year, and it was lined up for further cuts in 2013-14, before floods in the Somerset levels forced on the Government the realisation that they had gone too far. After those floods, the Prime Minister assured us that
“there will always be lessons to learn and I’ll make sure they are learned.”
But he has not shown many signs of having learned those lessons. Last year, flood and coastal erosion risk management expenditure was above £800 million, but this year it has been cut to less than £700 million—a 14% real-terms cut of £115 million. How quickly those images of the Somerset levels faded from his mind.
Mary Creagh
My hon. Friend is making an excellent point. Does she share my regret that, although the Prime Minister said money was no object, as soon as the television images of the Great Western main line under water had faded from public consciousness, money actually was an object?
Kerry McCarthy
I entirely agree. It seemed that money was no object in the short-term clear-up exercise, although there were delays in people getting the money promised to them. The Government are trying to speed up that process this time, by giving the money to local authorities, but council leaders have raised concerns that they simply do not have the resources and staff for that administration. I hope the Environment Secretary will provide some clarity on that.
Last week, the Environment Secretary was still assuring the people of Cumbria that the Government would learn the lessons, and the Prime Minister, on a fleeting visit up north, told them:
“After every flood, the thing to do is sit down, look at the money you are spending, look at what you are building, look at what you are planning to build in the future and ask: ‘Is it enough?’”
I am not convinced that it is enough. In June, the Committee on Climate Change gave flood adaptation a double-red warning, and the Environmental Audit Committee gave the Government a red card for climate adaptation. The Prime Minister did not have to wait for the floods to ask, “Are we doing enough?” The experts had already provided the evidence that we were not.
Caroline Flint (Don Valley) (Lab)
On learning the lessons, is my hon. Friend as surprised as I am that about half of the Chancellor’s fast-track zones to build houses are on floodplains? It is estimated that 9,000 new houses built on these floodplains might not be insurable because of the risk of flooding.
Kerry McCarthy
That is certainly an issue. Cockermouth has had planning permission approved for new houses, yet we have seen from the recent floods that the defences, which people thought were safe enough to withstand what was described in 2009 as a once in a lifetime or a once in a century event, were not good enough. The Government need to reassure me, therefore, that any defences around new housing in those areas would be sufficient to protect people and deal with the issue of insurance.
Andrew Stephenson (Pendle) (Con)
The hon. Lady is making an eloquent case about Cumbria, but did she take any time to visit Lancashire, because we have had really bad floods as well? In the same year that Labour-run Lancashire County Council has voted to increase councillors’ allowances—they now cost the taxpayer more than £1.2 million a year—it has admitted that the timescale for regular inspections of storm drains has been increased from every 12 months to every 18 months, which undoubtedly contributed to the flooding. Do local councillors not need to get their priorities right?
Kerry McCarthy
I have not yet had the opportunity to visit Lancashire, although during the floods I spoke to my hon. Friend the Member for Lancaster and Fleetwood (Cat Smith) about the situation there. It is a bit cheap to bring in details of councillors’ allowances, when we are talking about people’s homes being under water and their perhaps being homeless for the next 12 months. Perhaps the hon. Gentleman needs to speak to his Front-Bench team about the massive cuts they are imposing on local government before he starts raising such details.
Geraint Davies
Does my hon. Friend agree it would be worth the Government looking at local authorities running insurance systems, because high-risk properties would not be avoided and it might stop them building on floodplains, which they are still doing?
Kerry McCarthy
That is probably a question for the Environment Secretary to answer when she responds in a few moments.
The Government have announced and re-announced that they will invest £2.3 billion in flood defences over the next six years. As the EFRA Select Committee has today highlighted, that investment relies on £600 million-worth of external contributions, less than half of which have so far been secured. With the private sector providing just £61 million, DEFRA is looking to local authorities for the additional funding. Clearly, the Government do not get just how hard local councils have already been hit by the cuts. At the moment, just one of the 27 flood and infrastructure projects is currently in construction, and there has been no progress in the past year, while schemes in Cumbria have been delayed.
On maintenance, we have been told that the budget will only be protected, so I ask the Environment Secretary whether she believes that that budget is sufficient, especially given the years of neglect? The Government spent £171 million on maintenance last year. The Environment Agency has recommended that £417 million a year should be spent. It is no wonder that experts at Friends of the Earth are warning that there is a £2.5 billion hole in the Government’s flood defence plans.
Kerry McCarthy
I want to make some progress now so that Back Benchers who want to speak about what happened in their constituencies will be able to do so.
Last week, the Environment Secretary agreed with me about the extreme weather patterns and the link with climate change. The Government have conceded that the risks might have been underestimated, yet it has now emerged that they are not even using the most up-to-date information. I hope that the Environment Secretary will be able to tell us why the Environment Agency’s flood risk guidance, published in 2013, is based on forecasts from 2006—despite new research in 2011 indicating that river flows could be much greater due to climate change. Flood defence plans are modelled on the medium climate scenarios rather than the high climate change pathway.
Perhaps the Government want to ignore the high emission scenarios because that would mean spending £300 million more, but the costs associated with ignoring the evidence are potentially so much greater. The national security risk assessment cites flood risk to the UK as a tier 1 priority risk, alongside terrorism and cyberattacks. By focusing on the more optimistic projections, the Government are wilfully neglecting their responsibilities on climate change mitigation and adaptation.
As the rest of the work acknowledged this weekend, simply ignoring climate change will not make it go away, yet for two years the UK was hampered by having a climate change denier as Environment Secretary. It is even rumoured that he sought to replace the words “climate change” with the word “weather” in every single DEFRA document, and that he had to have it explained to him that they were not quite the same thing. What is certainly true is that under his stewardship spending on climate change adaptation halved, even after DEFRA’s climate change staffing had dropped from 38 to six people.
Thankfully, the current Environment Secretary is less hostile on this issue, although perhaps not very interested until now, and she will have our full support if her adaptation policies are guided by the scientific evidence and by expert advice. As such, we look forward to hearing more details on the national flood resilience review. I welcome the confirmation that the Cumbrian floods partnership will be looking at upstream options, and I hope these will be included in the resilience review.
A focus on the role of the natural environment in reducing flood risk is, unfortunately, long overdue. I see in his place the Under-Secretary of State for Environment, Food and Rural Affairs, the hon. Member for Penrith and The Border (Rory Stewart). His constituency was badly affected, and he did a huge amount of work on the ground in Cumbria over the past few weeks, so I am sure he has very much taken that point on board.
John Stevenson (Carlisle) (Con)
Talking of national resilience, does the hon. Lady think it was a failure of the last Labour Government not to have done exactly the same in 2005? In Carlisle, for example, we have a sub-station in a floodplain area that was flooded in 2005. Fortunately, due to the hard work of the emergency services, it was not flooded in 2015, but should it not have been looked at after 2005 with a view to possibly moving it?
Kerry McCarthy
We commissioned the Pitt review. The hon. Gentleman mentions the work of the emergency services, and I would like to take the opportunity to say that when I was in Cumbria I met the Fire Brigades Union and Mountain Rescue, which have done fantastic work. There are calls for the fire brigade’s response to flood risk to be put on a statutory footing, rather than just an add-on to its other duties. Mountain rescue teams do wonderful work based on the voluntary contributions and the work of volunteers. I hope that that will be looked at as part of the review.
Margaret Greenwood (Wirral West) (Lab)
On that point, does my hon. Friend agree that this is a timely opportunity to look again at the funding of fire services up and down the country? On Merseyside, we have certainly seen extreme cuts, and the whole model needs revisiting.
Kerry McCarthy
That issue was raised with me. I believe that five fire stations in Cumbria are due for closure. The control centre is in Warrington, but the point was made to me that local firefighters have the best local knowledge. People in Warrington were sending firefighters to places where people’s fire alarms had gone off because of rising water, but those firefighters knew that the towns and villages were already underwater and that the roads were impassable. A lot can be said for retaining local knowledge and for keeping the local fire stations open. I am sure that constituency MPs would have something to say about that.
Flooding has had a devastating impact on farmers and many in Cumbria have, as the National Farmers Union highlighted, been hit by a double whammy, after being informed that they will not receive their basic payments until February. Given the losses they suffer as a result of flooding and the positive contribution farmers can make to land management, I hope that DEFRA will work closely with farmers to involve them in a long-term strategic approach to flood risk, looking at surface run-off and soil management to maximise absorbency and how the Government can promote agroforestry. Studies have demonstrated, for instance, that reforesting 5% of land reduces flood peaks downstream by 29%. The Government could be looking at sediment management and river restoration, as well as woodland development more generally.
In urban and developed areas, sustainable drainage systems could make a positive difference, but progress has been slow and the scope for local authorities to make progress on flood risk management strategies seems limited, especially given the additional budget cuts. As the Climate Change Committee reported, many authorities are yet to finalise their strategies, despite its having been a legal requirement for the past five years. I hope that the Environment Secretary is co-ordinating cross-departmental work to manage the flood risk and ensure that it is factored into plans, including plans for new house building in areas of high flood risk, which my right hon. Friend the Member for Don Valley (Caroline Flint) mentioned.
In light of the agreements reached in Paris, I would urge the Environment Secretary to bring forward the climate change risk assessment and consider whether the national adaptation programme is fit for purpose. As the Committee on Climate Change has said, the next programme needs a “clearer sense of priorities” and “measurable objectives”. Even if commitments are met, the Paris agreement means that the Government must prepare for temperature rises of nearly 3°. Will the Secretary of State ensure that the announced national resilience review is only the first step in tackling the problem? It must lead to a realistic resilience plan—and, most importantly, action.
As yet, we do not know what DEFRA needs to adapt to, because we do not know what the Energy and Climate Change Secretary is proposing in order to implement the Paris agreement in the UK. In her statement on Paris yesterday, there was little sense that the Government had any strategy—let alone a coherent, fully-funded one—to meet the UK’s climate change commitments and help the global community to keep temperature rises below 2°.
The UN’s chief environment scientist has even had to intervene to challenge this Government’s policies on renewable energy. While the rest of the world is investing in renewables, she said:
“What’s disappointing is when we see countries such as the United Kingdom that have really been in the lead in terms of getting their renewable energy up and going”
withdrawing subsidies and enhancing the fossil fuel industry. We can only agree with her conclusion:
“It’s a very serious signal—a very perverse signal that we do not want to create.”
Under the last Labour Administration, the UK had a proud record on climate change—from Lord Prescott’s role with the Kyoto protocol and Gordon Brown’s work in establishing the Global Climate Fund to the role of my right hon. Friend the Member for Doncaster North (Edward Miliband), and indeed that of his brother before him, in the Climate Change Act 2008, which has now been emulated by about 100 other countries. It was ground-breaking at the time; we were the first.
That legacy is slipping away and future generations will pay the price. Given that the right hon. Lady failed to answer the questions of my hon. Friend the Member for Wigan (Lisa Nandy) yesterday, I hope the Energy and Climate Change Secretary will, when winding up the debate this afternoon, be able to confirm the Government will review the recently abandoned green policies and that the UK will continue to support raising European targets on reducing carbon pollution by 2030.
It is not just on energy where we need leadership. Will the right hon. Lady ensure that there is more co-ordination with the Department for Transport, that BIS prioritises green jobs and that our financial services do not keep promoting and investing in fossil fuels? And will she stop the Chancellor from making short-term cuts to energy efficiency and renewables, ignoring the longer-term environmental, financial and human costs?
Expert after expert is warning that the Government are failing on climate change, and failing to protect people from flooding. They are letting down communities who are dreading the next heavy rainfall, and they are letting down future generations who will bear the brunt of climate change. I hope that both Secretaries of State will agree that the Government have run out of excuses, and that now is the time to act.
The Secretary of State for Environment, Food and Rural Affairs (Elizabeth Truss)
The exceptional rainfall that we have seen over the past couple of weeks has led to some very distressing situations for families and businesses in the north of England, where serious flooding has occurred. It is right that we in the House use every opportunity we are offered to express our sympathy for those who are most deeply affected. It is also right that we pay tribute to the work of emergency responders—the Environment Agency, and volunteers from around the country—who have worked tirelessly to help to get people to safety, and to clean up quickly so that people can return to their homes as soon as possible.
The Government mobilised a full national emergency response. We deployed the military from day one to protect people’s lives. The Cobra civil contingencies committee has met daily to co-ordinate the best possible deployment of resources for affected communities, and the recovery effort continues.
Margaret Greenwood
Have the Government considered applying to the European Union solidarity fund to help the people of the north-west, who have suffered so much? If an application were made, how quickly could the additional funds be made available?
Elizabeth Truss
Of course that is one of the options that we are considering, but it would take seven months for the money to arrive. What we have done, within a week of these terrible floods occurring, is make £51 million available to give immediate relief to households and businesses in Cumbria and across the north that have been affected. The Chancellor announced last week that we were supporting households and businesses in affected areas.
The hon. Member for Bristol East (Kerry McCarthy) asked about accommodation. We are anxious to ensure that accommodation is available to those who have had to leave their homes, and we are working closely with local councils to ensure that they have every resource that they need for that purpose. Divers are assessing the bridges so that they can be opened as soon as possible, and diggers are clearing roads. We are doing all we can to ensure that Cumbria is up and running as soon as possible, and is open for business as soon as possible.
Tim Farron (Westmorland and Lonsdale) (LD)
The Secretary of State has rightly pointed out that great efforts have been made to clear the roads. As she will know, the A591 connects the north and south lakes at Grasmere and Keswick, and its closure has effectively ruined the tourist industry on both sides of that divide. The Royal Engineers did a great job in clearing up the mess, but they left yesterday. Would the Secretary of State be able to invite them back to rebuild the road quickly?
Elizabeth Truss
The hon. Gentleman is absolutely right. The A591 is a critical artery for tourism and for local residents to get about. It is now passable in a 4x4 vehicle, but we are working on getting it fully up and running as soon as possible, and the Department for Transport is working closely with the Cobra team to ensure that that happens, because it is a priority. I am pleased to say that the west coast main line was up and running as quickly as possible. Nearly all the 169,000 households and businesses whose power was cut off have been reconnected, although a small group of fewer than 50 need extra work at flooded properties. The Environment Agency has been assessing what more can be done, and has been moving in heavy equipment to clear rivers.
Our priority must continue to be public safety. Although 84 flood warnings have been removed in the last day or so, further flooding could occur as a result of rain falling on saturated ground. I urge people to keep up to date with the latest situation through the Environment Agency’s website and other news sources.
I know that this is of no comfort to those who have suffered, but the flood defences in Carlisle and Kendal successfully defended more than 100,000 households and businesses and prevented them from losing their power supplies. It is important for us now to consider how we can further improve resilience in our country.
The Secretary of State for Energy and Climate Change is working to ensure that we have long-term energy security, and that we tackle dangerous emissions. I think that she has shown massive leadership over the past week. Hers was an historic achievement in Paris, and I think that Opposition Members should applaud her for showing such leadership at an international level. I see that some of them are acknowledging her leadership; that acknowledgement is particularly welcome from the former Climate Change Secretary, the right hon. Member for Doncaster North (Edward Miliband).
Graham Stuart (Beverley and Holderness) (Con)
I apologise to my right hon. Friend for returning to the subject of flooding when she has—rightly—just moved on to the subject of climate change, but does she agree that it is now time for a radical change in the way in which we fund our flood infrastructure and maintenance? The hon. Member for Bristol East (Kerry McCarthy) pointed out that when floods occur, there is investment, there are promises, but the investment then fades. That happened under the Labour Government, and it tends to happen under all Governments. Should we not hand responsibility for a regulated standard to, for instance, the water companies?
Elizabeth Truss
We have already made a major change. Rather than allowing a stop-start in flood defence spending, we have, for the first time, laid out a fully funded six-year programme to give communities the certainty they need. I shall say more about that later, but I was in the middle of praising my right hon. Friend the Secretary of State for Energy and Climate Change. She has done a fantastic job, and I think that that needs to be acknowledged. She has achieved an international climate change deal that will bring about a level playing field—it is very important for countries across the world to contribute—but she is also making sure that we deal with customers’ bills at home. It is right for us to improve our economy, achieve economic growth and reduce carbon, and my right hon. Friend is showing how that can be done.
Elizabeth Truss
I have already given the hon. Gentleman an opportunity to contribute. I want to make a bit of progress now.
Under this Government, there is a long term-plan for economic and energy security, part of which involves improving our resilience and investing in flood defences. Extreme weather events are becoming more common. There have been devastating floods in Cumbria, Lancashire, Northumberland and elsewhere, and there has been record rainfall. Water levels in our rivers have been more than half a metre higher than they have ever been before. Yesterday, during my second visit to Cumbria in a week, I went to Appleby and Threlkeld, where I met residents, Army volunteers, and others whose work has been tremendous during this rescue effort. I saw the sheer power of the water, which had washed bridges downstream, but I also saw a huge amount of spirit and resilience among the Cumbrian people.
Caroline Lucas
May I invite the Secretary of State to return to the question asked by the hon. Member for Bristol East (Kerry McCarthy) about maintenance grants, and the amount that will be spent on maintaining existing flood defences? Does she accept that there is a shortfall of £2.5 billion between that amount and what the Environment Agency says is needed, and, if so, is she going to fill the gap?
Elizabeth Truss
I can confirm that, as the Chancellor said in the autumn statement, we will increase our current maintenance expenditure of £171 million a year in real terms. In a climate in which we are having to reduce Government budgets, we are increasing, in real terms, both flood capital spending and flood maintenance spending. That shows where our priority lies.
Mary Creagh
In his report following the devastating 2007 floods, Sir Michael Pitt said that flooding was the greatest risk that our country faced from climate change, and that flood defence spending needed to rise by more than inflation each and every year. Can the Secretary of State explain why, in real terms, we will be spending exactly the same in 2015-16 as we were spending in 2009-10?
Elizabeth Truss
The reality is that between 2005 and 2010 Labour spent £1.5 billion on flood capital, whereas between 2010 and 2015 we spent £1.7 billion, which is a real-terms increase and not a cut. In this Parliament, we are investing £2 billion, which is a real-terms increase and not a cut.
John Woodcock (Barrow and Furness) (Lab/Co-op)
The question is: does the Secretary of State think that that is sufficient, given the recent events, and given the clear and growing link to climate change and its devastating effect?
Elizabeth Truss
I thank the hon. Gentleman for his question. The additional funding we are putting into flood defences will mean a reduction in flood risk over the next six years. That is not an elimination of risk, and we also need to make sure that we have the right emergency response in place, but flood risk will be reduced.
Several hon. Members rose—
Elizabeth Truss
I just want to answer the point raised by Opposition Members about the spending in recent years. Following the 2013-14 floods, we put in an extra £270 million to repair and rebuild the defences that were destroyed. That is the money that Opposition Members are talking about, but even if we take account of that extra funding, which rebuilt and repaired defences after the winter floods, we are still spending more in real terms in this Parliament on flood defences, and we are laying it out in a six-year programme for the first time ever. When Labour was in power it never laid out plans for more than one year at a time, whereas we are laying out a six-year plan.
Caroline Flint
When the Chancellor was pulling together his fast-track zones for housing, whereby half the houses are going to be built on floodplain areas, did the Secretary of State have sight of that policy? Did she comment on it? If not, why not?
Elizabeth Truss
I will be very clear with the right hon. Lady: the Environment Agency is part of the planning process and it does not allow house building on floodplain areas—that is part of the planning process.
Rebecca Pow
The Secretary of State will remember not only the floods in Cumbria, but the awful flooding in Somerset. The Government have committed £35 million to Somerset until 2021, but will she comment on the arrangement we are putting in place through the Somerset Rivers Authority, which may become a model for dealing with flooding, funding and the wider catchment area?
Elizabeth Truss
I thank my hon. Friend for her intervention. She is absolutely right to say that Somerset Rivers Authority, which is now established, forms a model that we can use in other parts of the country. It gives local people, who understand the area and the local catchment, the power to make decisions—
Elizabeth Truss
I have already given way to the right hon. Lady once and I want to make progress, in order to give the many constituency MPs who are part of the debate an opportunity to speak.
I want to respond to the Opposition’s point about local farmers, some of whom I met yesterday. We are helping them to get their land sorted out, as much of it is covered with rubble. We are putting in place a special scheme to help farmers, which will be open from this Friday, and we are also seeing what we can do to prioritise basic farm payments for the worst affected farmers.
I have talked about our £2.3 billion programme—this is the first time ever that a Government have laid out their future flood defence spending. The private sector partnership money that the hon. Member for Stockton North (Alex Cunningham) has been talking about is in addition to the real-terms increase—extra money so that even more flood defence schemes can go ahead. We have already secured £250 million of that money and we have a further £350 million earmarked. We are only six months into the scheme. Let us remember what happened between 2005 and 2010: only £13 million was raised. We raised £134 million in the last Parliament—10 times that raised under the previous Government.
The money we are putting in represents real flood defences across the country. It means that in Boston we are building a new £90 million barrier; in Rossall, Lancashire, we are investing £63 million for a new 2 km sea wall; in Exeter, we are investing £30 million in new flood defences; and on the Thames we are investing £220 million in a 17 km flood relief channel. I am pleased to say that in the constituency of the hon. Member for Bristol East we will invest £1 million in a scheme for Brislington, and that in Stockton North we are investing £8 million in a scheme at Port Clarence and Greatham South. What this money—this real-terms increase in spending—means is real protection for real families and real businesses across the country, in addition to protection for 420,000 acres of farmland.
Graham Stuart
My right hon. Friend knows that local MPs supported a proposal to the Department seeking about £1 billion to help the Humber area, which faces the second greatest strategic risk in the country, after London. What plans does the Department have to work on coming up with a viable programme for our area?
Elizabeth Truss
I thank my hon. Friend for his question. We are investing £80 million in flood defences for that area, but I am happy to meet him and his colleagues to talk about what more we can do to increase resilience there.
It is very important to note that we are not complacent about our flood defences. We will look at what has happened in recent weeks to make sure we learn lessons and act upon the new evidence that has come to light. We have committed ourselves to two reviews: first, the Cumbria flooding partnership, led by the Under-Secretary of State for Environment, Food and Rural Affairs, my hon. Friend the Member for Penrith and The Border (Rory Stewart), who has responsibility for flooding, will look at how we can improve downstream defences, do more to look at the overall catchment and slow the flow upstream, and more fully involve the community. I saw a fantastic project last week at Stockdalewath, where upstream mitigation is being used to reduce the peaks in river flow. This is already happening, but I want to see more of it, which is why we are launching this new workstream. Secondly, we are putting in place a national resilience review to look at how we model and plan for extreme weather, how we protect our critical assets and how we make future investment decisions—my hon. Friend the Member for Beverley and Holderness (Graham Stuart) asked about that. With the £2.3 billion programme that we have laid out, we want communities to have certainty that their projects are going ahead, so this review will look at future flooding investment to make sure that the formula is adapted to what we now know.
Let me be clear with Opposition Members that we already have some of the most sophisticated flood modelling in the world. For the first time in Cumbria, during this flooding we used ResilienceDirect, which meant that all the emergency services could communicate with each other in real time and with the Environment Agency, which was very effective at getting early action. We are working to make sure that we keep up to date with the latest trends in climate and in extreme weather, which the hon. Member for Bristol East was talking about.
The Government are completely committed to doing whatever it takes to make sure Cumbria and the other flood affected areas are up and running and more resilient for the future. But the reality is that without a strong economy, under a Conservative Government, we would not have money for these crucial schemes. It is our party that is investing in new power stations and making sure we have energy supplies, while reducing carbon emissions. It is our party that is investing to make this country more resilient and adapt to climate change and extreme weather. The Labour party has no plan, having shirked these decisions when it was in office and wasted our money. Let us all remember what the then Chief Secretary to the Treasury said:
“I’m afraid there is no money”.
That was the Labour Government’s legacy. The fact is that it is the Conservative party that is protecting our economy, and safeguarding our security and our future.
Calum Kerr (Berwickshire, Roxburgh and Selkirk) (SNP)
Mr Speaker, thank you for allowing me the opportunity to take part in this debate. I should like to urge Opposition Members in particular to pay close attention to what I have to say. Unfortunately, the motion shows a fundamental lack of understanding of the reality on the ground in Hawick and the Scottish borders, which is my constituency and which suffered serious flooding earlier this month.
Tom Elliott (Fermanagh and South Tyrone) (UUP)
Does the hon. Gentleman accept that in my constituency in Northern Ireland there has been serious flooding in the past 10 days, and the motion makes no reference to that? Even today, at least 16 roads are still closed in the constituency.
Calum Kerr
That is an excellent point. My constituency is mentioned in the motion, yet it has not been mentioned once in the debate so far, and the hon. Gentleman has had the same experience. It is extremely disappointing that the motion makes a fundamental error in terms of the funding process for flood defences in Scotland. I hope to explain this and say why I make this statement up front.
On 5 December the River Teviot broke its banks and it is true that some 600 people had to be evacuated in Hawick. A total of 333 homes were impacted, as well as 45 local businesses. However, the town reacted magnificently to the crisis. I was among the volunteers, along with the Scottish Minister for Community Safety and Legal Affairs, Paul Wheelhouse, putting down sandbags under the direction of Hawick flood group, with the police and emergency services, who all did a fantastic job. The reality is that, had it not been for their help and intervention, things would have been a lot worse. I pay tribute to all their efforts, including Scottish Borders Council. We all know that our councils tend to be the whipping boys on occasion, so I pay particular tribute to it for co-ordinating the effort.
The damage and disruption caused by the Hawick flood has been significant. The Scottish Government made it clear from the start that the Bellwin scheme would be implemented to fund repair work. They also emphasised that money was available to fund a full flood prevention scheme. A preferred scheme has been chosen, and we are now moving to detailed design. It is critical to get this right, as a wrongly built scheme can fail or even make things worse. This swift response has eased the worries of people in the town and shown the Scottish Government to be empathetic and fast acting.
John Woodcock
Just so that I am following the hon. Gentleman’s speech, is he saying that the Scottish Government have been exemplary and wonderful, and there is nothing else that he would ask them to do on behalf of his constituents in this important matter?
Calum Kerr
That is a wonderfully glowing tribute to everyone in my constituency. I thank the hon. Gentleman. If he would like to listen a bit more, I will go on to explain the process in more detail. If anyone says that nothing can be learned, they are mistaken. There is always potential to improve the response and do better next time. The flooding that took place will be examined in detail, and will inform the flood defences that are put in place.
Right across Scotland, there was a first-class and highly impressive multi-agency response. However, the stark truth is that we will never be able to stop flooding fully. It has been with us throughout history. Both the Old Testament and the Koran tell us the story of Noah and the Ark. I am afraid that there must have been people in Scotland and indeed in the constituency of the hon. Member for Carlisle (John Stevenson) who thought they were extras in the sequel. As we cannot prevent water flows, we must do our best in redirecting them. In Scotland, all the flood defences we had in place held. In Galashiels in my constituency, they stayed in place, and in Selkirk, although only half built, they did their job. This highlights how well-designed schemes can make all the difference.
The Scottish Government regard reduced flood risk as a priority and provide annual funding of £42 million for councils to add to and invest in major flood prevention schemes.
Patrick Grady (Glasgow North) (SNP)
Does my hon. Friend accept that there is also an issue of urban flooding, which has perhaps been slightly less reported? Summerston in my constituency has been renamed an island because all the major access roads were blocked by sudden flooding and overflowing drains. It is important that local authorities are able to invest the money appropriately.
Calum Kerr
I thank my hon. Friend for that excellent point. It is absolutely not just a rural challenge. The flood damage in urban areas is exacerbated by the concentration of dwellings.
Geraint Davies (Swansea West) (Lab/Co-op)
I was in charge of flood risk management for Wales, so I know how important devolved Administration is in this respect. Has the hon. Gentleman considered the capture of water on buildings in butts to reduce the amount that goes into sewers or investing in the resilience of particular properties by putting plugs up walls, waterproofing and so on? No defence is 100% reliable.
Calum Kerr
The hon. Gentleman displays an admirable knowledge of the subject. If I ever live in a house built on a floodplain by the Conservatives, I will know where to go for advice.
It is important to consider all aspects. The debate is about climate change and flooding, but many other issues such as land use and planning could be covered in a lot more detail. We must always plan to prevent flooding at a local level and mitigate where we can. The hon. Gentleman makes an excellent point, and I thank him.
The Scottish Government enacted their Flood Risk Management (Scotland) Act in 2009. This introduces a sustainable and modern approach to flood risk development which considers the problems of climate change. For instance, it creates a revised and streamlined process for protection schemes as well as a framework for co-ordination between organisations involved in flood risk management. New methods have also been put in place to ensure that stakeholders and the public have an input into this process, as is happening in Hawick now.
Another hugely important piece of legislation is the Climate Change (Scotland) Act, again enacted in 2009. This sets some of the toughest climate change targets in the world, with an interim 42% reduction by 2020 and an 80% reduction target by 2050. Ministers are required to report regularly to the Scottish Parliament on progress and emissions. Earlier this year, the Committee on Climate Change concluded that Scotland had continued to make good progress towards meeting these ambitious greenhouse gas reduction targets. We are on track to meet that 42% target ahead of schedule. In fact, we continue to outperform the UK as a whole.
In western Europe, only one of the EU15 states, Sweden, has achieved greater reductions. The Scottish Government have not hit all their targets, partly because of data format revisions, but they should be applauded for their ambitious vision and for seeking to lead the way. The determination is that Scotland should continue to be a world leader in this area. That, surely, is the right approach. We should acknowledge their ambition and successes so far. I hope that in this Chamber we will recognise that there is a lot to learn from them in terms of best practice. For instance, the Scottish Government have pledged some £1 billion of funding over two years for climate change action and have plenty of reason for optimism.
Last year, renewables overtook nuclear as Scotland’s largest source of electricity. Only last month, wind turbines produced 131% of the electrical needs of Scottish households. These are highly encouraging figures. However, no nation can operate in isolation in this area. Only by working together can world leaders properly address this, the greatest global environmental threat of our age. At last week’s Paris summit, we finally managed to achieve a universal agreement—one that has been signed up to by rich and poor countries alike. I congratulate the Secretary of State on her role and hard work in securing success at that historic event, which was also attended by Scotland’s Environment Minister and First Minister. The deal reached will not by itself solve global warming. It is not a panacea. But Paris finally showed that the will, along with a firm commitment, is there.
Caroline Lucas
The hon. Gentleman will know that emissions from aviation and shipping were left out of the Paris agreement. Does he agree that that is a fatal omission and, similarly, that airport expansion, be it at Heathrow, Gatwick or anywhere else, would fatally undermine the UK’s ability to make a fair contribution to keep global warming well below 2 °C, let alone the 1.5 °C goal that is a matter of survival for many vulnerable countries?
Calum Kerr
The hon. Lady makes an excellent point. It is notable that the recent carbon report made the same point about excluding the contribution of air quality in this regard. We must start looking at the whole picture.
Paris did, however, show that the will exists, along with a firm commitment. As long as the 196 nations which signed up to the declaration are prepared to prove that their word is truly their bond, we can look forward to a future that is bright and a future that is green. In Scotland, as in so many other countries, this agreement could literally reshape our landscape. At present, increasing rainfall and changes in patterns mean that our 50,000 kilometres of rivers are likely to flood more often. That could affect most of our major airports, which are on low-lying land, as well as places such as the petrochemical complex at Grangemouth. Rising sea levels also mean that some of our coastal habitats could be lost entirely.
There is another effect. Climate change affects lungworm, a disease which affects sheep and renders their lungs unusable as food. I hope not to disturb my colleagues but sheep lungs are, of course, a key ingredient in haggis, which is central to Scottish culture. What would Burns night be without haggis? There could be a threat to our very nationhood! Hopefully, though, we can now avoid some of the worst consequences of climate change and the consequent risk to one of our finest native foods.
Since the election in May, the SNP has argued strongly against UK Government moves to roll back support for renewable energy. Subsidies to onshore wind, solar and power station conversion to wood or biomass are being reversed, and green deal funding scrapped. I know that some of my colleagues plan to talk about this in more detail and about the Treasury’s decision to cut investment in carbon capture and storage technology, which is unwise and short-sighted.
Some environmentalists say that we are now going through the worst period in green policy for 30 years. The need for positive and dramatic action stares us in the face. Climate change can no longer be denied. After Paris, every nation will have to be bolder. This offers us a real opportunity to change the direction of travel. It is the perfect time for Ministers to reverse their recent negative attitude towards renewables and, like Scotland, turn the UK into a leader. They must walk the walk. This is our moment of choice. We can, literally, turn back the tide. For us, and for our children and grandchildren, while there is still time, I implore this Government to help to do so.
Graham Stuart (Beverley and Holderness) (Con)
It is a pleasure to take part in this debate, following as it does the excellent news from Paris and the rather more depressing news of recent flooding.
I have just lost two of my favourite Ministers from the Front Bench—although they are staying for a moment—but I have another still on the Front Bench. I am delighted to have their temporary audience. Like my right hon. Friend the Secretary of State for Environment, Food and Rural Affairs, I congratulate our right hon. Friend the Secretary of State for Energy and Climate Change on her part in helping to deliver a deal in Paris. Colleagues across the Chamber will doubtless debate how important and how effective that deal is and how it contrasts with Copenhagen, from which the right hon. Member for Doncaster North (Edward Miliband) bears such scars. Despite much of the detail being left for future work, I think we have a framework from Paris which can give us hope for the future. The intended nationally determined contributions provide the building blocks with which we can go forward. We have in place in the agreement the promise of not only a stocktake, but a review and, we hope, a growth in ambition over time.
Following Paris, my right hon. Friend the Secretary of State for Energy and Climate Change has two things to do. One is to ensure that UK decarbonisation proceeds within the framework provided by the Climate Change Act 2008 and the fourth and fifth carbon budgets—our most current—which have been produced by the Climate Change Committee. We have not always got it all right. For instance, in the case of onshore wind, which is the lowest cost form of renewable energy that we have, there was a misdiagnosis of the problem.
The diagnosis of the problem, which people like me helped to provide over many years on behalf of our constituents, was that our constituents did not like having onshore wind turbines foisted on them, their local councillors ignored and a distant inspectorate insisting on them being built, resulting in our constituents losing any sense of control over the local environment. What local people wanted was to have control over their local environment. In those areas where there was least opposition, or where the recompense was adequate, onshore wind turbines should be allowed, but where local people were set on not having them, they should not go ahead.
That was a mistake that Labour made in government. With various Ministers in place I tried to get them to see that we would ultimately end up with more if we went with the grain of local opinion rather than trying to fight against it, but inevitably those whose local environment would be dominated by those constructions and who had had no say on it would find a political voice and eventually bring the scheme to a halt. We would end up with fewer, rather than more, wind turbines. So it has proved.
The misdiagnosis lay in the fact that my party came to the conclusion that the difficulty was not the planning, but the subsidy, even though it is the lowest subsidy of any form of renewable energy. So we got to the bizarre situation where there is no subsidy for the cheapest form of renewable energy, at the same time as we talk about lowering costs to consumers. We should have removed the right to appeal to the inspectorate and allowed the developers to provide packages which won support in certain parts of the country. Personally, I felt that we would have ended up with more, but somehow we have ended up with the cheapest form of renewable energy in effect receiving no support, which is a bizarre outcome. We do not want to make further such mis-steps.
On the positive side, in my local area we have offshore wind. By next year we should have 6 GW of offshore wind in this country, more than the rest of the world combined. By 2020 we should have 10 GW and, as the Secretary of State laid out recently, as did the Chancellor in the autumn statement, there is every hope that we will see a doubling of that between 2020 and 2030. So we are making significant progress in offshore wind, and it is only because of the pipeline that we have seen the supply chain and manufacturers able to invest and lower cost.
The big task for the Secretary of State is to work out how we are going to deliver decarbonisation of the UK economy at the lowest possible cost. It became apparent to me 10 years ago at the Montreal COP—conference of the parties—that we had to get the costs down. Sadly, hand-wringing environmental concern is not widely shared among the general populace of this country, among parliamentarians or across the world. We need to get the costs down so that it becomes more politically acceptable to people to do that which is compatible with tackling the risks suggested by the science.
My advice to the Secretary of State is that in every decision she makes in this area, she needs to think about creating a framework which encourages that investment. The state is only a relatively small player. Sometimes Ministers of successive Governments in this country talk as if the state is the key driver. The state is not the key driver; it is a small player. We create the framework, then we get the investment. It is that investment in solar by private companies in China and elsewhere, partly driven by the German market, that has led to the massive reduction in costs for solar. It has been the private sector investment, with the help of the Green Investment Bank, which has helped accelerate the cost curve downwards for offshore wind. That is what we must do—create a consistent environment.
There was a lot of positive rhetoric under the Labour Government about tackling climate change, but remarkably little action. In the end, in 2010, there had not been the progress that we should have seen. In the United States, by comparison, the rhetoric has always been negative but the policy environment for investment has been more positive. That is why there has been a great deal of investment in the United States, as well as more innovation and more jobs created than in this country, even though we, through the Climate Change Act and other things, have tried to be, and appeared to be, world leaders.
Huw Irranca-Davies
I cannot let the hon. Gentleman’s comments pass without intervening, but I will try to say this on a cross-party basis. The success in offshore wind, which is now quite remarkable and we need to keep it going, was built on the back of the pipeline that was set up during the period of a Labour Government. That Government—I was an Environment Minister at the time—put in place things such as the £60 million investment in the ports facilities that is now allowing Siemens to carry out manufacturing in this country, and gave the go-ahead for the licensing.
Graham Stuart
The hon. Gentleman is right to make those points. Quite a lot of the progress that has been made in the past five or six years was built on that, but in the 13 years of Labour Government remarkably little progress was made. If we compare the investment environment in renewable and other green technologies in the United States, despite all the negative rhetoric, with the investment there has been in this country, we do not come out all that strongly.
The second challenge that faces the Government, after UK decarbonisation, is helping others to fulfil their national contributions to the INDCs and to build confidence at each national level to go further. Thus, when we have the review in five years’ time, we will be able to raise the ambition so that we are not heading, as now, for under 3°, but are genuinely able to head for a sub-2° world. There is a tremendous amount to be done in engaging with parliamentarians. I should declare an interest as the chair of GLOBE International. Colleagues from across the Chamber attended the summit of legislators in Paris the weekend before last. We need to engage more with parliamentarians. That is equally true in Parliaments such as ours where, despite today’s attendance, there are remarkably few colleagues with much interest in or knowledge of the subject matter. We have to engage more people so that they take more interest and ensure that we get the frameworks that deliver the investment. There is a huge role for the UK to play in developing countries through climate diplomacy and work with GLOBE and others to make sure that we engage with these parliamentarians, who, after all, pass the laws, set the budgets, and hold Governments to account. That is certainly what GLOBE aims to do through its chapters around the world.
I want briefly to say something about flooding, following my earlier intervention on the Environment Secretary. The threat to the Humber is real and growing, with rising sea levels. Last December, we saw a bigger surge than in 1953. If the wind direction and other factors had been slightly different, there would almost certainly have been loss of life. This is a growing issue and we need to find a long-term solution. My personal thought is if we leave it to Governments, who have to decide between investment in schools, hospitals and so on, and long-term investment in flooding, they always have a tendency, when not under the shadow of a recent flooding disaster, to cut back that long-term investment. Would it not be better to set a regulatory standard on which we could rely by handing it over to water companies, whose job is to borrow money from the international markets and invest for the long term at the lowest possible cost, to deliver an agreed standard? If we had a statutory standard with a duty placed on those bodies to deliver, and all the water tax payers of the country picking it up, we would not only save the Chancellor from the cost hitting the Exchequer directly, but could have in place lower-cost intervention, to an agreed standard, for the long term, and stop having these fervent and heated debates every time we have a flood disaster, which, given climate change, is likely to happen more often in future.
Edward Miliband (Doncaster North) (Lab)
It is a pleasure to follow the hon. Member for Beverley and Holderness (Graham Stuart), who plays a very important role in the GLOBE organisation of parliamentarians. This debate comes at a timely moment after the Paris agreement, and after the tragedy of the floods that we have seen. I know that many hon. Friends want to talk about the effects on their constituencies, so I will try to keep my remarks reasonably brief.
I want to focus on the question of what the Paris agreement means for UK domestic policy. In doing so, I praise the Secretary of State for Energy and Climate Change, who played an important role in the talks. She was the host of the high ambition coalition between developed and vulnerable countries, and her office was its headquarters. She deserves credit for the very constructive role that she played. Having said that, when I listened to her statement yesterday, I felt, while I do not want to be unfair to her, that her position was somewhat to say, “Everything has changed and nothing has changed.” In other words, internationally everything has changed, with high ambitions, zero emissions and all that stuff, but for the UK things are the same as before. I want to make the case that that cannot be right, for four reasons, three of which are to do with the agreement itself.
First, on 1.5°, no previous agreement has enshrined a commitment to try to commit to
“efforts to limit temperature increase to 1.5 C.”
This is a higher ambition than there has been in any agreement before. The Secretary of State knows that, because she was one of the people who helped broker the agreement. The reason it was brokered is very interesting: it was because of the case put forward by countries like the Marshall Islands that will disappear with warming of more than 1.5°. Some people fear that the high ambition coalition was a ruse to break up the G77 and China grouping in order to put pressure on the Chinese to get an agreement. I do not believe that it was a ruse. However, we cannot just say, “Our domestic policy will not change,” because if we suggest that our attitude to a 1.5° agreement is the same as to a 2° agreement, countries like the Marshall Islands will conclude, “Hang on a minute—were these people serious after all?”
The Committee on Climate Change picked up on this point in its release yesterday, saying that it would make it even more important—I am paraphrasing somewhat but I do not think I am misrepresenting it—that we met its recommendations on carbon budgets, and that it might be the case that further steps should be taken. It said that it would come back to the Secretary of State on that in early 2016. I would be interested to hear what she thinks are the implications of this more exacting target—because it definitely is more exacting.
Caroline Lucas
The right hon. Gentleman is making a very strong case, which I appreciate. Surely the difference that 1.5° makes means that we need to think again about aviation expansion. In yesterday’s aviation statement, which came right after the climate statement, nobody even mentioned climate, and yet aviation is one of the fastest-growing sources of greenhouse gas emissions.
Edward Miliband
When we were in government, I played one part in the rather unhappy saga that is Heathrow. In response to the demand that we should approve Heathrow, I pushed for a separate target for aviation emissions. Of course that must also be looked at as part of the 1.5° target. There cannot simply be unconstrained expansion of aviation. The hon. Lady makes a good point.
Secondly, the agreement contains not just the 1.5° aim but a long-term goal of zero emissions. When I asked the Secretary of State about this yesterday, she said that she was happy pursuing the existing targets in the Climate Change Act. I think that those targets are very important, because I helped legislate for them, and I am very happy that she wants to make sure that we meet them. However, when I was Climate Change Secretary we had not had a global agreement for net zero emissions. We cannot possibly say, “We’ve got this global commitment to zero emissions in the second half of the century but it has no implications for UK domestic policy.” Of course we have to look at what it means for the UK.
My case to the Secretary of State, which I hope she will consider—I am not asking for an answer today—is that when the Energy Bill comes back to this House in the new year she amends it to ask the Committee on Climate Change to do something very simple, which is to look at this issue and make a recommendation to Government about when we should achieve zero emissions. That would do a number of things. It would send a cross-party message that Britain is determined to be a climate leader; the Secretary of State has talked eloquently about the impact that the Climate Change Act had, with cross-party support. It would also reduce, not increase, the costs of transition, because it would provide a clear trajectory to business and, indeed, to future Governments.
I say to Conservative Members, who have understandable concerns, that it would be supported by business. I am not the most radical person on this issue. The most radical people are, believe it or not, Richard Branson, Paul Polman of Unilever and Ratan Tata. They want not just what I am suggesting, but something much more radical—they want zero emissions by 2050. Perhaps that is what the Committee on Climate Change will concede, but my approach is much more pragmatic, as is that of the hon. Member for Beverley and Holderness (Graham Stuart). Let us not pluck a figure out of the air—such as 2050—without having the experts look at it; let us look at what the implications of the global goal of zero emissions are for the UK. That is a very reasonable suggestion.
Graham Stuart
I agree with everything the right hon. Gentleman has just said about aiming for zero carbon. Does not the involvement of Unilever, Virgin and other businesses show that, if leadership and certainty is given, the investment conditions will be such that we will be able to get the money flowing, as I said in my speech, and jobs will be created here? If we lag behind with uncertainty, we will not have those jobs, and pioneering businesses will not establish themselves, invest or provide jobs here. If we are going to do it, it must benefit this country to the greatest extent possible.
Edward Miliband
The hon. Gentleman makes an eloquent point. Every extra ounce of uncertainty raises the cost of capital. He and I have discussed that many times and that is what business people are saying, because they want that certainty. They are asking, “What are we working towards?” That is why all those leading businesses are putting it forward.
I do not want to say to the Secretary of State that this is easy, because it is a long way off, but it is an easy win for her. She would go down in history as the person who helped legislate for zero emissions, which is the ultimate backstop. When I was Secretary of State, the ultimate backstop was 80% reductions. Now we know from the global agreement that the ultimate backstop must be zero emissions at some point.
Kevin Hollinrake (Thirsk and Malton) (Con)
I am interested in the right hon. Gentleman’s specific policies to tackle CO2 emissions. In the US, fracking is credited by the Intergovernmental Panel on Climate Change as being the principal reason for the reduction in greenhouse gases. Does he support shale gas exploration in the UK?
Edward Miliband
I am sceptical that it is the solution, because we have to get to zero carbon. It is true that replacing coal with gas has helped us reduce emissions. One of the reasons that our emissions have fallen as they have is the replacement of coal with gas, and I welcome the Secretary of State saying that she is going to phase out coal, but that is not a long-term solution. This agreement is about the end of fossil fuels. Carbon capture and storage can make a difference, but essentially we are transitioning to a world after fossil fuels.
David T. C. Davies
Does the right hon. Gentleman accept that if we are going to use wind power or solar, we have to have CCS, as National Grid has said; otherwise, we will not be able to match grid demand?
Edward Miliband
Certainly. While we are on the subject of sorry sagas, I am afraid that one of the other sorry sagas is the CCS competition, which is a recipe for how not to make policy. It was started, believe it or not, nearly 10 years ago by the Labour Government. I think it was started under Alistair Darling. I then pushed it forward before this Government cancelled the competition, then restarted it and then cancelled it again.
Callum McCaig (Aberdeen South) (SNP)
It has been an incredibly sorry saga, but I do not think that the previous Labour Government can have anything positive to say about CCS, given how badly they treated it when it was going to be introduced at Longannet.
Edward Miliband
I am not saying it is glorious from anyone’s point of view. What I put in place was a mechanism to provide four projects. At the time, the Conservative Opposition said, as Oppositions do, that four was not enough and that there should have been six. Then they cancelled the mechanism, then they said there would be public funding, then they cancelled that competition and then they restarted it. I think we can all agree that it has not been a glorious episode.
The third reason that I think the world has changed is the five-year ratchet mechanism in the agreement. It is a mechanism to ratchet up ambition so that the pledges that countries make meet the aspiration. At the moment, we are saying 1.5 °C, but the pledges add up to 3 °C. We argued for the mechanism and the EU said before the summit that it wanted its emissions to be reduced by at least 40% by 2030. As I understand it, “at least” meant that if there was a stronger agreement, we would ratchet up the EU ambition. I ask the Secretary of State and the Government: what is the mechanism to make that happen? The world has changed, because we have a strong agreement, and the EU said at least 40%, so how are we going to ratchet it up? In his closing remarks at the summit, President Hollande said that he wanted to raise French ambition. I would be interested to hear the Secretary of State say, either today or in the future, how she thinks we can raise that ambition.
A fourth and final thing has changed since Paris, and it relates to the Secretary of State and her role in Government. I want to say something personal to her about that. I think that the thing that has changed after Paris is her negotiating power. Anyone who has been a Secretary of State knows that not all the decisions go their way—that was certainly true when I was Secretary of State. I am sure there have been a number of times over the past few months—obviously, the Secretary of State is not going to say this at the Dispatch Box—when she wanted a decision to go one way but it went another way. Successful Secretaries of State, however, recognise their power, and I say to her that she is empowered by the Paris agreement. She is empowered by it to tell the Prime Minister that he cannot just use warm words abroad and then not follow them through with deeds at home. She is empowered to tell the Chancellor that British business is, frankly, furious at the neglect of a crucial and growing sector of the economy. Above all, she is empowered to be the Cabinet champion for tackling climate change. If the Secretary of State does that—if she is that champion—she will get support from those Members on both sides of the House who believe in this cause, as I know that she does, too. They will support her in her endeavours.
In conclusion, whatever the Secretary of State does, we need to match the high ambition coalition in Paris with a high ambition coalition at home. That high ambition coalition has to combine trade unions, business and civil society. I do not see Paris as the end in any sense; it is merely the beginning—it gives us a new beginning on climate change. In the interests of future generations, we have to seize that moment.
Several hon. Members rose—
Madam Deputy Speaker (Mrs Eleanor Laing)
Order. This is a short debate. Lots of people want to speak, so I have to impose a time limit of five minutes.
James Heappey (Wells) (Con)
The motion conflates two hugely important issues, both of which are worthy of debate in their own right. I will speak initially about flooding and if time allows I will move on to climate change.
Somerset is affected by both elements. We have very recent and painful experience of flooding, and we have a well developed energy industry, with everything from Hinkley Point to widespread deployment of solar and anaerobic digestion. We also have the opportunity for much more, if we can harness the power of the Severn estuary.
On flooding, after speaking about our experience in Somerset at this year’s Flood Expo, I have been visited in Parliament by representatives of the Lincolnshire drainage board and the National Farmers Union, who were keen to discourage a one-size-fits-all approach to flood risk management and its funding. Cumbria has its own circumstances, just as Somerset is different from Lincolnshire, so I stress that, while I fully support the measures being delivered in Somerset, some—perhaps all—will not be applicable elsewhere. That said, the speed of the full spectrum response in Cumbria indicates that lessons have clearly been learned since our floods in 2013-14. I congratulate those on the Government Front Bench on the speed of that response and commend the emergency services, armed forces and volunteer groups that answered the call.
I was disappointed to hear the hon. Member for Bristol East (Kerry McCarthy) reflect in her opening speech that the Government have not delivered on their commitment to Somerset after the floods. Labour does not have many south-west MPs, but she is one, so surely she must know that huge improvements have been made in our region since those floods. Work on the great western mainline at Dawlish was completed within months of the floods, and the peninsula rail taskforce has since made clear, as I am sure she well knows, its plans to improve resilience both on the Somerset levels and with a new line to open north of Dartmoor.
On roads, work to improve culverts underneath the M5 has been completed, and Somerset County Council has also completed widespread improvements to the county’s road network. There has also been significant investment in pumping infrastructure, dredging and the sluice network, and Sedgemoor District Council and the county council are pushing on with advanced plans for a Parrett tidal barrier. There was public money for flood relief for the villages impacted, and most importantly, there is the Flood Re scheme, which will provide real peace of mind for those who can now insure their homes. Above all, there is the support for the Somerset Rivers Authority, a very welcome strategic authority which looks after the interests of the county when it comes to flood defences.
All of that is happening just four junctions down the M5 from Bristol East. I am sure that if the shadow Secretary of State would like to come and see me, my fellow Somerset MPs and the leadership of Somerset County Council, we would be delighted to show her how much the Government have achieved in Somerset and how much more they are yet to deliver. None of that has been cheap, so I very much welcome the £2.3 billion that will be invested in flood defences over the next six years.
In the very short time remaining, I want to say that I very much welcome the Paris deal. The Energy and Climate Change Committee, of which I am a member, looks forward to discussing it with the Secretary of State for Energy and Climate Change tomorrow. The deal is not perfect, but it is a remarkable feat, and I congratulate the Government on the leading role they played in brokering the deal. Meeting the Paris targets will be challenging, especially as we must concurrently ensure the security of supply and the affordability of bills.
The programme for new nuclear power is very welcome, but I also congratulate the Government on their enthusiasm for offshore wind and on their success in growing the solar industry in recent years, although I appreciate that changes in the subsidy later this week may challenge that industry. The solar industry is protesting very loudly, but the Government say that the subsidy has become a crutch and the industry is now ready to go it alone. I very much hope that the Government are right, because there are a great many jobs in the solar industry in the south-west that I want to continue.
Finally, I very much welcome the Paris announcement. The Government have a real challenge in ensuring that we achieve the right domestic policies to achieve the aims, while maintaining our security of supply and keeping bills down. There are plenty of opportunities, not least on generation, but my personal interest is very much in achieving greater management of demand, which I hope the Government will pursue.
Caroline Flint (Don Valley) (Lab)
It is a pleasure to follow the hon. Member for Wells (James Heappey), although it is saddening how often during the past few years so many Conservative Members have had to stand up to speak about the terrible floods that have impacted on the communities they represent. It would be remiss of us if our discussion did not begin with a thought for the people of Cumbria and for others across the UK who are facing a second flooding in just six years, many of whom will spend Christmas away from their own homes.
In its latest report on adaptation progress, the Committee on Climate Change rated planning for residual flood risk to existing properties at red, both in terms of the plans in place and actual progress. As the Secretary of State for Environment, Food and Rural Affairs admitted during her response last week, the models that we currently use need updating. I will make two points about that.
First, many people are sick and tired of being told that the floods that have wrecked their homes are one-in-100-year events, given that the severe floods we have seen during the past 10 years suggest that such erratic weather will be far more frequent than once every century. If the Government and all of us are to learn anything from that—I hope we can work on a cross-party basis on these issues—it is that the patterns of weather in the past century are a poor guide to future risk, so we must ensure that the new models we need take that into account or the public will gain false comfort about their own security.
Secondly, the Government must work across Departments. It is very worrying that the Secretary of State for Environment, Food and Rural Affairs failed to answer what I thought was a very common-sense question: “Have you had a discussion with the Chancellor about the zones that Ministers are fast-tracking for housing development?” I believe we need more homes—do not get me wrong on that—but we really must have a joined-up policy across the Government if we are to make progress both on housing and on limiting the risk to our communities. I found it very worrying that she failed to answer that question, but perhaps the Secretary of State for Energy and Climate Change will return to that point in her summing up. On that area, as on climate change, if we can find a better way to work together—this is not to say there should not be scrutiny—I know that Labour Members would want to work not only to make the future better, more secure and brighter for ourselves, but to show leadership in the world.
That brings me to Paris. Many positive things have come out of the Paris agreement. Whatever the importance of using “should” rather than “shall” or “shall” rather than “should”, we still have an unprecedented, universally binding deal that aims to limit the temperature rise to beneath 2 °C degrees and to make efforts to stay below a 1.5 °C rise, which is very welcome. Progress has been impressive. I have to commend the Energy and Climate Change Secretary for her work on this; I must also commend our French colleagues, who despite everything that has happened in France recently, managed to hold a vital conference for the world and to produce such a good result.
As we stand, however, the UK does not have the policies in place to deliver either the UK’s 2020 renewables target or its fourth carbon budget. As my hon. Friend the Member for Ogmore (Huw Irranca-Davies) said, the Government’s recent “reset” contained little to help us get there. I want the UK to develop a credible plan to deliver the 80% reduction in emissions by 2050 that our groundbreaking Climate Change Act 2008 requires. That is important in itself, but it is also a stepping stone or a foundation for moving towards net zero emissions.
In the limited time I have left, I want to say this: net zero is a huge ask. As Paris demonstrated, the world is a long way from that 2050 aspiration of 80%, and even further from that of net zero. We must therefore begin work on what a net zero carbon society should require. We must look at the research and engage scientists and engineers to make this a reality. If I learned one thing during my time as shadow Secretary of State for Energy and Climate Change it was that my job was not just to talk to the converted, but to convince those for whom this is not top of their agenda that it is the reality for them, and is something of which they can be a part and from which they can benefit. Let us get down to the practicalities and, across the House, make this happen.
David Mowat (Warrington South) (Con)
I do not have a direct constituency interest in this subject, but I want to talk about Paris. It is a pleasure to follow the last two Labour speakers, the right hon. Members for Doncaster North (Edward Miliband) and for Don Valley (Caroline Flint). Much as I commend the Secretary of State for Energy and Climate Change for the work she has done, I am afraid that my analysis of Paris is not quite so sanguine as the opinions we have so far heard.
It is not true that the INDCs add up to a 2.7 °C limit. That analysis is somewhat dishonest because it is based only on contributions continuing further on a basis to which countries have not committed themselves. The right hon. Member for Don Valley called Paris a “universally binding” agreement, but it is not binding on anybody. That does not mean it is not a good start, and we have to start somewhere, but the fundamental point is that if the world had adopted the Climate Change Act in the way the shadow Secretary of State said, we would be on track for a rise of 1.5 °C. The United Nations framework convention on climate change says that to get to the limit of a 1.5 °C rise the world must reduce carbon emissions by between 75% and 90%, while the Climate Change Act states 80%. A fair challenge would be that developing countries find it much harder to do than developed countries. I accept that China, India and such countries need more slack, so the implication is that we perhaps need to go further, which is where some of the right hon. Lady’s numbers come from.
I want to spend the minutes available to me in analysing the performance of the developed countries at Paris, and particularly of the EU. One of the most startling factors about the INDCs that were put into the mix in Paris is that the EU submission for a 40% reduction over 40 years—1% a year, as it were—is 33% slower than the reduction demanded by the Climate Change Act and its resulting budgets. That is not all, however, because if we take out the UK bit of that EU INDC, the implication is that the rate of reduction will be between 40% and 45% slower than that for the UK. That is odd: what do other EU countries find so difficult about reducing emissions that we apparently do not find difficult? Parts of the EU are developing, relatively speaking, because they are catching up in terms of GDP. It might be reasonable for countries such as Poland and Romania to be given more slack. However, the truth is that countries such as Romania have made the most rapid reductions, so that is not the issue. Romania has made big reductions, because the 1990 baseline coincided with a period when its industry needed to be sorted out.
The issue is in the developed countries such as Austria, which has increased its emissions by 20% since 1990, and Ireland, Holland, Spain and Portugal, none of which have reduced their emissions since 1990. The House has criticised the Secretary of State for Energy and Climate Change for a lack of ambition, yet we are part of an EU submission to a global conference that puts up with that kind of thing. I ask her to address why that can happen and what sanctions there are on those countries within the EU aegis that can stop it happening.
There are reasons why it is happening. Some countries have banned nuclear power. Some have banned carbon capture and storage. It is not that they have just not invested in it—it is illegal in some countries. CCS is illegal in Germany and it is building brand new unabated coal power stations. Its emissions are a third higher than ours per capita and per unit of GDP.
Graham Stuart
I am grateful to my hon. Friend. I wonder whether he could expand further on the points he is making, because I am finding them most interesting.
David Mowat
My hon. Friend is always a team player. The extra minute will be put to great use.
The EU, taken collectively and not including us, failed abysmally to put forward at Paris anything close to what the right hon. Member for Doncaster North said, probably rightly, would need to be delivered to achieve 1.5°. We have to understand what the sanctions are for that, but the reasons are many and varied.
The EU got completely bogged down, as Members of this House sometimes do, in a fixation with renewables and renewables targets, rather than thinking about a carbon reduction target. Countries have put in place considerable renewables, but continue to burn coal at scale. The truth is that if we replaced coal with gas globally, it would be equivalent to increasing the renewables in the world by a factor of five. There are many points like that.
The fundamental point, which the Secretary of State will have to address in her high ambition coalition, which presumably does not contain Austria, is that we must ensure some fairness. Otherwise, places such as Redcar and Motherwell will have to get used to what has happened to those places, and that really is not right.
Tim Farron (Westmorland and Lonsdale) (LD)
Colleagues from all parts of the House are rightly praising the Secretary of State for Energy and Climate Change for her role in Paris. I do not have time to go into that at great length, except to say that she did indeed play a blinder, as did this country as a whole. However, it is very difficult to stack up her signing the agreement in Paris with her slashing subsidies for renewables, ending the green deal and privatising the green investment bank. The Secretary of State is perhaps, if she will forgive me, the José Mourinho of environmental politics—impressive on the international stage, woeful domestically.
Climate change is clearly not an esoteric matter, although some would consider it to be so. The impact on my constituency, throughout my county and on other places is very real. The impact on the families who will be out of their homes at Christmas—the hundreds upon hundreds of children who are not able to look forward to Christmas at home—is utterly heart-breaking. I want us to think, first and foremost, about the human cost. Among the things that I am seeking from the Government is additional support for Cumbria’s health and social services to support mental health provision and counselling for people in desperate, desperate need.
I praise the response not just of the emergency services, which have been absolutely fantastic, but of organisations such as Kendal Cares and the churches in the south Lakeland area. The response can absolutely reassure us about human nature, as people who had lost almost everything went next door to help people who had lost absolutely everything.
The scale of the floods needs to be put in a numerical sense. PricewaterhouseCoopers reckons that the cost of the floods to Cumbria is £500 million. Therefore, the Government support of £50 million, although welcome, is clearly nowhere near enough. In the few moments available to me, I will set out why we need additional support and ask for it.
There are some who will dismiss people who are uninsured or underinsured as feckless. They are not feckless; they are penniless. Very often, these are people who could not afford insurance in the first place or who could afford only insurance that was cheap and, therefore, inadequate. There are many people who live in areas that flood regularly and who, therefore, could not get coverage in the first place.
The £500 grants from the Cumbria Community Foundation are utterly welcome and I praise it, but £500 will not get people far if we consider what we would lose if the ground floor of our homes flooded—all the white goods and all the other things we need to make life possible. We need support so that the £500 can be increased significantly.
We need to recognise that the £5,000 per household that the Government are promising is for flood prevention in the future, not to help people who have lost significant amounts of money right now. That money should be delivered to people in Cumbria right away and directly.
I reiterate my comment about the A591. To those who heard the Secretary of State for Environment, Food and Rural Affairs say earlier that it was passable in a 4x4, I say that I was there yesterday and it could just about be passed on a bicycle. It is not true.
John Stevenson
Does the hon. Gentleman agree that one of the priorities in the long run, beyond the work on the A591 and Pooley bridge, must be to invest in and renew our road infrastructure in Cumbria?
Tim Farron
The hon. Gentleman makes a very good point. He is doing an excellent job for his constituents in Carlisle. He is right that the investment now will help the county in the long run. I ask the Government to invest in making sure that the A591 is rebuilt and reopened in a matter of weeks, not months, because the current situation is devastating for the local economy.
There is also a plan on the table from Cumbria Tourism that the Government need to provide funding for right now. There is a short-term, immediate strategy—as in, today—to boost the economy up to Christmas through a marketing campaign and a medium-term campaign to make sure we get back on our feet.
Other parts of the Lake district have been hugely hit. The village of Staveley has been cut in two by the closure of its bridge. Again, we need support for that in weeks, not months. Likewise, the bridge that connects the two communities at Backbarrow, which was lost six years ago in 2009, is closed again and needs investment straight away to make sure it is reopened.
It is important that people get the message, and that the Government get out the message that Cumbria is open for business. I was in Grasmere yesterday. I cannot think of a more Christmassy place to be at this moment, but equally I cannot think of a quieter place. People are not going there because they think the place is closed. It is not. Please go there. Please will the Government get the message out that that is what people need to do?
I have a quick note about farmers. I am very concerned that the Government are planning to close the Lyth valley pumps in June. I was there yesterday and we cannot allow that to happen. Will the Government commit to funding the pumps beyond the end of June? Will they also commit to help farmers who have lost stock in tragic circumstances up and down the county? They must recognise that much of the money that goes into keeping the Lyth valley dry is about protecting infrastructure, which the hon. Member for Carlisle (John Stevenson) mentioned. The A590 is often flooded as a consequence of that farmland not being drained, so the pumps are important for infrastructure too.
I want to make a final point about the long-termism that is needed. We often hear the phrase “long-term economic plan”. The problem is that we had an autumn statement recently in which the Chancellor pulled out of his hat lots of white rabbits, but none of those white rabbits were for the Department of Energy and Climate Change, the Department for Environment, Food and Rural Affairs or the Department for Communities and Local Government. The three Departments that we desperately need to be on the frontline to protect people in Cumbria are massively denuded. We have local authorities—South Lakeland District Council, Cumbria County Council and others—working very hard and doing a very good job, but with about 20% less people and resources than they had six years ago. It is therefore vital that the Government commit to providing the £500 million that PricewaterhouseCoopers has identified so that we can rebuild our communities, support our damaged people and communities, get people back in their homes, and do so quickly.
Rebecca Pow (Taunton Deane) (Con)
I am speaking today, first, because we have to praise the historic agreement that was made in Paris. I commend not only my right hon. Friend the Secretary of State for Energy and Climate Change, but the whole team and Labour Members for all the work they did in the past. We also have to send commiserations to all those poor people suffering from flooding. We are dealing with both those things in today’s motion.
I felt I had to speak, coming as I do from Somerset, like my hon. Friend the Member for Wells (James Heappey). Taunton Deane was, sadly, at the heart of the terrible flooding of 11,500 hectares of land from December 2012 right up, really, until January 2014. So I really can sympathise with the poor folk of Cumbria.
In Somerset the impact was enormous. The cost for businesses, with all the knock-on effects, was estimated at £147 million, and it affected half of all the businesses in Somerset, even the ones that were not flooded, because of the road closures and things like that.
It was a once-in-a-hundred-year event, so it was not exactly expected, and it was not just a result of not dredging rivers, although that was one of the things that made a difference. The rivers Parrett and Tone had not been dredged during the 1990s—and I am afraid I level that at our friends in the Labour party because it was under their Government that the dredging stopped.
The flooding was also caused by a combination of many other things, including increased run-off from the urban areas around Taunton. But whether this extreme flooding was to do with climate change—that is still debateable—we clearly do have to be prepared for these events. In Somerset I am very pleased at the programme that has been put in place to set up the Somerset Rivers Authority. This has come with general agreement and much debate. A precept is to be set on everyone in Somerset and legislation will be passed to introduce it. That will then deal with the wider programme of tackling flooding in the future.
I commend the Government. They have spent £15.5 million on flood defences in Somerset, protecting thousands of properties, and have made an overall commitment of £35 million until 2021. They are taking flooding extremely seriously.
Luke Hall (Thornbury and Yate) (Con)
I take my hon. Friend’s point about preparations. Will she join me in welcoming the doubling of investment for innovation in low-carbon technology as one of the less talked about outcomes from Paris?
Rebecca Pow
I thank my hon. Friend, and I know he was at Paris. I was going to mention that at the end of my speech, but I will mention it now. Nobody has so far mentioned one of the crucial aspects of this debate: the investment in science and technology to enable us to meet all these commitments so that we can get to our zero rating. With our brains and our scientists, I am absolutely sure we can do it.
The investment in flooding is money well spent, because every £1 spent on flood defences gives between £4 and £9 of benefit to the economy. So it is well worth doing.
With my environmental-agricultural hat on, and as the new chairman of the all-party group on ancient woodland and veteran trees, I want to highlight a few areas, and here I have some agreement with the hon. Member for Bristol East (Kerry McCarthy). There are many other things we can do to mitigate the effects of climate change and extreme weather in our environment. There is the wider catchment approach. There is working with farmers and landowners to slow the flow of water into the river basins, and I know that my hon. Friend the Member for Berwick-upon-Tweed (Mrs Trevelyan) will agree with me on that. There is more tree planting; I applaud the Government’s commitment to plant 11 million trees—that is one for every five people. Perhaps we could plant a few more. Those trees will also help to slow the flow of water. Re-wilding is another area we could be looking at, as well as silt traps, ponds, and storage areas higher up in the valley to stop the water coming down quite so quickly.
All of those things can be, and ought to be, included, and I will put in my usual call for more grass. Grass and mixed farming economies are the way forward. Grass holds in the water as well, and sequesters the carbon. I hope that the forestry Minister, my hon. Friend the Member for Penrith and The Border (Rory Stewart), will look more closely at including grass in our policies. [Interruption.] We may laugh at that, but this is a serious way forward and it is great for the management of the countryside.
On climate change, I commend the Government on everything they are doing. We have taken immense steps forward in securing this ambitious global deal, and we are moving in the right direction, but there is much still to do. Zero carbon emissions is a testing ambition.
Rebecca Pow
I would be delighted to give way to my hon. Friend from across the hills.
Neil Parish
The Opposition are saying that we have not made great progress on renewables, but we only have to see that in Devon and Somerset and across the west country there are huge amounts of solar panels in the fields. That did not happen under the last Government—and in fact many of our constituents complain that there are too many.
Rebecca Pow
My hon. Friend raises an extremely good point and we have seen the roll-out of solar renewables. We have made immense progress. Some 16% of our energy is from renewables and that is because of the steps this Government have taken. People are still buying into renewables and it has got cheaper. The cost of the panels has come down, which is why we need to remove the subsidies and put the subsidies where we can have more energy from other sources that need a bit of a boost. So I am right with the Secretary of State on her policy here.
We need to lead by example. We have been doing it, but we need to continue to do so. I am a great environmentalist, but we have to do this within the constraints of the economy, which is something this Government are dealing with at all costs. We have had a debt to deal with. We are still paying off the legacy left over. We have to be realistic about what we are doing, and we have to provide security of energy at the lowest cost to the taxpayer, so whatever we do, there has got to be a balance.
Big applause for the Government for their big step in getting rid of coal-fired power stations. If there was one single thing we could do for low-carbon energy, it was that. Applause also for Hinkley Point, obviously, which is very near my constituency. It is the biggest commitment to low-carbon energy we could possibly think of.
I shall wind up by saying we can all do our own bit at home as well. We can all buy in, like Quantock Eco, Transition Taunton, Transition Athelney, and the Somerset Wildlife Trust. We can cut our air miles, make fewer car journeys, grow our own food. We can buy into it, and we need to buy into this whole situation. We need to do it through every Government Department. We need to do it across the world. We need to do it in our own homes.
Sue Hayman (Workington) (Lab)
First, may I apologise for my absence from my place last week? I am sure hon. Members are aware of the devastating floods we have had in Cumbria—it has been discussed during this debate. As my constituency is in Workington in Cumbria, I felt I should stay there to visit and support as many people and businesses as possible who had been affected by the floods. I welcome the Secretary of State’s statement during Question Time that she intends to visit Cockermouth on Tuesday.
I hope Members will indulge me for speaking from the heart about the events of the past 10 days or so. On the Sunday morning—nine days ago—I stood with shopkeepers and residents, shocked and horrified at seeing Cockermouth main street under water again after only six years. Every Member here will have a high street. I ask them to imagine standing at the end of that high street with the shopkeepers, with that whole high street, from top to bottom, under water. It is shocking. After the water subsided over the coming days, we were able to assess the damage.
Flooding is not just about water. There is a lot talked about water, but water is incredibly powerful and in Cumbria it roars down the fells in the overloaded becks. It carries everything in its path. Drains back up and overflow, and oil tanks get swept away.
Last week in the village of Flimby I stood with a family on their effluent-soaked carpet. I stood inside homes in Cockermouth that stank of diesel oil. I watched families in Workington throw decorated Christmas trees into skips. I visited the flooded village school in Brigham and went to the town of Aspatria to see more damage.
Parents are now telling me that their children are too frightened to go to sleep in case it happens again. They are frightened of the rain. It is heart-breaking.
Our community is resilient and has pulled together in an extraordinary way. I pay tribute to the local councils, the emergency services, the coastguard, mountain rescue, supermarkets that gave free food, the nuclear industry, the Kirkgate centre and so many volunteers, from Churches Together to Muslims 4 Humanity. I thank everybody throughout the country who has given money to the Cumbria Community Foundation for their generosity.
I want to pay particular tribute to Neil Banks, who works for Allerdale Borough Council. We have some flats where 34 elderly residents were trapped. They could not get out and they had no power, water or food. Neil crawled through with water and torches and gave them the help and support they needed.
One young family told me that they had bought their home because they were reassured that the floods of 2009 were a once in a 100-year or a once in a 1,000-year event. They believed that the floods were unprecedented. We have to stop using that language. The Environment Agency told me that the flood defences worked—that they did what they were designed to do. They made a big difference in some areas and to some families, but that is little comfort to the many people who have been made homeless just before Christmas.
What do we need to do? I welcome the Government’s announcement about the Cumbrian floods partnership group. I urge the group to invite Cockermouth and district chamber of trade to be a member, because it has invaluable experience to offer. I am pleased that the group is to be chaired by the Under-Secretary of State for Environment, Food and Rural Affairs, whom I thank for coming to Cockermouth on Sunday.
Edward Miliband
My hon. Friend is making a powerful speech. She deserves more time to make it, so I thought I would intervene on her.
Sue Hayman
I thank my right hon. Friend.
The Government have said that they will fund more defences, but the costs for Cumbria alone are estimated to be £500 million, and the solutions are about so much more than building higher and higher walls. The water has to go somewhere, and if we are not careful, we will build flood defences in one place with the result that protecting one area means that another takes the water and is damaged.
We must look at our design of bridges. The bridge in Cockermouth ended up being a dam as it became more and more clogged with debris. We need to look at planning—it has already been said that there is simply too much building on floodplains. I fully endorse the appeal that my predecessor, Lord Campbell-Savours, made last week in the other place for a complete ban on housing development on the West Cumbria flood plain.
I want to end by talking about insurance. Time and again, residents told me that, after the floods of 2009, they were either unable to get household insurance or it was offered with huge excesses—most commonly, £10,000. Now they cannot sell their homes.
Cat Smith (Lancaster and Fleetwood) (Lab)
I thank my hon. Friend for making such a powerful speech. Does she share my concern that insurance problems also affect many small local businesses, which are struggling to make ends meet and often cannot afford the premiums?
Sue Hayman
I thank my hon. Friend for making that important point. We are concerned in my constituency that, if we do not do something about the problem of insurance, we will end up with abandoned streets that might as well be demolished. In fact, some local residents are so distressed that they have asked whether the Government would consider buying their houses and knocking them down because it would be cheaper and less stressful than building a flood barrier.
What help will the Government give my constituents in this position? They are honest, hard-working, decent people. Many have lost not just the contents of their homes, but their cars, and some have lost their livelihoods.
We were told that Flood Re was the answer after the previous floods, but it has been a fat lot of good to my constituents today. It is late—it is not expected to come in until next year; it is arbitrary and does not cover properties built after 2009, despite houses continuing to be built on floodplains, and it does not cover businesses. When people have insurance, the insurance companies are refusing to pay for resilience measures.
My constituents need help now. They need it quickly. Climate change is here—its effects can be seen in Cumbria. We need a Government who are serious about having a long-term strategy to prevent this from happening again. We need the money and resources to make that happen.
Madam Deputy Speaker (Mrs Eleanor Laing)
Order. Before I call the next speaker, I remind the House that the rules on interventions exist to allow debate to happen. It is right to intervene, and it is great for certain Members to be complimented by extremely senior members of their party—that has happened to some extent on both sides of the House this afternoon—but when the clock adds an extra minute for an intervention, it does not add any more minutes to the day or to the debate. It means that someone less fortunate in their placing on the list will speak for less time. I appreciate that there are many people whom Members would like to speak for less time, and many whom they would prefer to speak for more time, but one has to be careful about how that is managed.
David T. C. Davies (Monmouth) (Con)
I am not sure into which category I fall, although I suspect that I know.
First, I express my sympathy to all those victims of floods—Monmouthshire has been affected by flooding in the past, of course—and all those who helped with the clean-up. However, I take issue with the idea that man-made climate change has caused all that. It is unfortunate that the two issues have been mixed up.
We have had few debates about global warming and climate change. Climate change has been with us for millions of years, ever since the Earth was created. I urge the Secretary of State for Energy and Climate Change to ask a few hard questions of those who are frankly displaying some hysteria about climate change. In the past 2,000 years, there have been periods of warming and cooling. It was warmer during the Roman period; it got cooler in the dark ages; it was probably warmer during the medieval period than it is now, and it got cooler again until about 1680, during the so-called little ice age.
One of the first questions to which the Secretary of State should find an answer is how much of the small amount of warming that has taken place in the past two centuries—about 0.8°—is down to man-made carbon emissions and how much is due to natural factors, such as the warming that must have taken place as a result of coming out of the little ice age.
David T. C. Davies
I have asked that question on many occasions and nobody could give me an answer, but I think that a former Minister is about to do so.
Richard Benyon
Ninety-five per cent. of climate scientists seem to suggest that man-made climate change is the problem. Many of us would like my hon. Friend to be right in his scepticism because that means that everything will be okay. Unfortunately, 95% of climate scientists, such as those we met at the Royal Society, disagree with him.
David T. C. Davies
I take issue with my hon. Friend. The 95% or 97% figure is floated around often, and I have done some research on it. It appears to have come from the Zimmerman/Doran survey, which was sent out to 10,257 potential respondents, who claimed to be climate scientists. Only 77 responded and 75 said, “I’m a climate scientist and it’s all down to man.” [Interruption.] If any other hon. Members know where the figure came from, they are welcome to let me know.
The IPCC’s most recent summary for policy makers has also put out some misleading statements. Page 17 of the “Summary for Policymakers 2013” states that it is extremely likely that more than half of the increase in global average temperatures from 1951 was caused by man. However, of that 0.8° figure, only about 0.5° comes from the second half of the 20th century. That means that, if the IPCC is correct, only just over 0.25° out of 0.8° was caused by man. That means that more than half is due to other, more natural factors.
My right hon. Friend the Secretary of State for Energy and Climate Change may also like to ask about the lack of firm correlation between the increases in temperature and those in carbon emissions. Even in the past 200 years, there has been a sharp increase in carbon dioxide, but there has not been a sharp increase in temperatures. They have gone up and down. They were going up between 1910 and 1940 and they were going down markedly between 1940 and 1977, leading many to believe that we were on the brink of another ice age. From the mid-1970s until 1997, temperatures were rising, as were carbon emissions, but from 1997 or 1998 until now, there has been a sharp increase in CO2 but no increase in temperatures. We may wish to ask why that is.
I have had meetings with the Royal Society and the Met Office, and I recently asked that question of Professor Jim Skea—a lead author on the IPCC—in a public meeting at the House of Commons, chaired by Lord Deben. I asked why there had been no increase in temperatures for the past 17 or 18 years, and he said that that was statistically insignificant. That is a fair comment. He was not trying to say that this is about oceans or because the volcanoes are cooling, or any of the other many theories; he said that it is statistically insignificant, and he may have a point. However, if the past 17 years of no increase in temperature are statistically insignificant, why are the 27 or so years before that when there was an increase in temperature so statistically significant that we have to go ahead with all sorts of policies that will have a massive impact on homeowners and businesses in the UK?
Finally—I do not think anyone will be kind enough to intervene on me, although if someone wishes to, I shall be more than happy—
David T. C. Davies
Thank you! I have been waiting. I will give way to the hon. Member for Westmorland and Lonsdale (Tim Farron) because I always prefer to give way to the Opposition—it is more fun.
Tim Farron
All Members of the House appreciate scepticism, and I am sure that the hon. Gentleman’s scepticism is sincere. The problem is that if he spreads that kind of nonsense, he provides people with an excuse not to take action, and gives comfort to those who want us to do nothing about the biggest challenge facing humanity.
David T. C. Davies
I appreciate the hon. Gentleman’s kind words—I think—but I am just trying to raise questions. If he wants me to go to my constituents and try to sell policies that will push up their energy bills and make it more likely that some of those in the manufacturing industry will be out of work, I must have answers to questions that have not yet been provided. Why has there been no warming since 1997? Why is there no correlation over the past few hundred years? What percentage of 0.8° is down to natural factors? Those questions are important. Of the CO2 that has gone into the atmosphere, why has nobody queried the fact that less than 5% is man-made? People talk about CO2 as some sort of pollutant, but it is a perfectly natural gas and most of it is generated naturally from the earth and the sea.
Mr Jim Cunningham (Coventry South) (Lab)
We can all talk in different debates about different views on what causes climatic change, but that is no consolation to the people of Cumbria who want to know when their insurance companies will pay up. That is the immediate problem.
David T. C. Davies
The people of Cumberland are right to want to know that, but the flooding should not be blamed on something that is unproven when the impact of changes that we make will affect people across the UK. Opposition Members were the first to complain about policies that have pushed up energy prices and made it more difficult for manufacturers such as those in the steel industry to make a profit. Some manufacturers, such as those in Redcar, have recently closed, partly because of those high energy costs. With all due respect, I say to the Secretary of State that Opposition Members will not support her policies if they lead to an increase in energy prices. She will be attacked by the Opposition when steel and other manufacturing plants close, and she will be attacked for causing fuel poverty.
David T. C. Davies
I cannot at the moment. Aid agencies talk about trying to drive up living standards in the third world, but they are making it harder for African villagers to get access to cheap electricity from coal. Environmentalists talk about the importance of reducing carbon dioxide emissions, but they are totally opposed to nuclear power. They talk about wanting more wind power, but they are totally opposed to fracking for gas, which is necessary if we want nuclear energy. There is a great deal of inconsistency and many unanswered questions, and I ask the Secretary of State to respond to them.
John Woodcock (Barrow and Furness) (Lab/Co-op)
Given recent controversies about the way that I have addressed other hon. Members, I will say only that the speech by the hon. Member for Monmouth (David T. C. Davies) was enthusiastic, and I will not refer to its content.
On behalf of my constituents, I want to express solidarity with the people of Cumbria and other areas, and across the bay into Lancaster, because of the dreadful situation that they have been in over the past week. I pay my respects to, and thank, the many agencies that have genuinely pulled out all the stops to help people at this difficult time, from national agencies to community organisations and individual members of the community who have pulled together.
I also give my heartfelt thanks to fellow parliamentarians. My hon. Friend the Member for Workington (Sue Hayman) made a magnificent speech and she is doing a wonderful job for her constituents at this difficult time. Despite really challenging conditions, The Bay radio managed to keep broadcasting and effect an emergency service throughout that period, and I am thankful to my hon. Friend the Member for Lancaster and Fleetwood (Cat Smith) for reminding me of that.
The debate on responsibility and past fault is valid, and it helps us to understand what has gone wrong in public policy and what has worked. However, it only goes so far, and it is important that the House focuses on what has been deficient and what can be done in future to make it better. In that sense, I hope that Ministers will have the courage to assess the issue dispassionately. Where they identify that the current trajectory is insufficient, I hope they will take the difficult steps of arguing with their colleagues to put those things right for the future. They owe it to the people of Cumbria and the north-west who are suffering so badly, but also to the whole country, to ensure that it is recognised that these floods will not happen only once in 100 years. It makes a mockery of Government science if we cling to that description, given the prevalence of such events in recent years.
In the time I have left I want to push for answers and further action on specific issues in my area regarding what happens next. In 2009 Furness was badly hit by floods, and some homes are still suffering from the six-year process to get back on their feet, and the difficulty of getting insurance. This time we were more fortunate, but transport links were affected when the A roads at both ends of my constituency were flooded and became impassable. That occurrence is all too frequent in that area, not simply because of adverse weather conditions, but because of accidents. I urge the Environment Secretary to speak to the Transport Secretary and agree to reassess the A590 and areas that are flooded such as Levens and Lindale, and to make anti-flooding measures investment priorities. Such measures are really needed and could genuinely be a matter of life or death, given the vital health services that we often have to access across Morecambe bay.
I call on South Lakeland District Council to reopen the issue of building on floodplains in Ulverston and other areas. It has set its face against such a reassessment, but surely these events will give them the courage to think again. Finally, let me add to the message from the hon. Member for Westmorland and Lonsdale (Tim Farron). I have been contacted by Anita Garnett of the Ulverston Brewing Company, who passed on the huge concern from local pubs because people are not visiting at this vital time. South Cumbria and Furness remains open for business, and that message must go out loud and clear.
Kevin Hollinrake (Thirsk and Malton) (Con)
My hon. Friend the Member for Monmouth (David T. C. Davies) asked for evidence for his constituents. A quick check on Google shows that the NASA site states that the five-year average for global temperatures is rising by 0.75% a year, and that the 10 warmest years on record have all occurred since 2000. That may help.
David T. C. Davies
Does my hon. Friend think that Jim Skea, an IPCC lead author and world renowned expert on climate change who spoke recently at the House of Commons, is wrong about the hiatus, as is the Met Office?
Kevin Hollinrake
I do not know Mr Skea, but I do know of NASA. And I have another minute on the back of that intervention, which I appreciate.
There has been a fourfold increase in extreme weather events since the turn of the 19th century, and we have all seen the terrible scenes affecting homes, businesses and farmers and the devastation as the water recedes. In my constituency, the town of Pickering has suffered devastating floods four times in 10 years. The Secretary of State joined me in opening an innovative scheme there called Slow the Flow, which other Members, including my hon. Friend the Member for Taunton Deane (Rebecca Pow), have mentioned. This involves upstream attenuation measures, bunds, the planting of 60,000 trees, dealing with timber debris and the restoration of wetlands, all of which will help matters upstream. I urge the Secretary of State to look at this as a model for future activity.
Our television screens have been dominated in recent weeks by the flow of migrants across continents. Perhaps this is a warning of the much greater population movements ahead if we do not tackle climate change. It is a threat to our lives and our livelihoods and to national, global and economic security. I welcome the Secretary of State’s efforts in Paris. She showed great leadership in getting together 190 nations in a single unanimous agreement. There are difficult choices ahead, and I do not envy Ministers who have to make tough decisions many years in advance amid the many voices and choices.
Credit where it is due, the UK has a proud record on climate change. In the climate change performance index, the UK is No. 2, behind only Denmark and way ahead of most other western countries. We had the world’s first green investment bank and the world’s first tidal lagoon, and we are a world leader in offshore wind. We have trebled renewable energy production to 19%, but we have much more to do. The energy performance of our housing stock needs to be improved. We need to replace the complex, defunct and ineffective green deal. We also need to invest further in renewables and energy storage.
Neil Parish
My hon. Friend talks about the insulation of homes, and we need to do a lot more for solid wall properties. Many of the rural areas in our constituencies have such properties, but a lot of the green deals simply do not stack up as a result of the extra cost involved in the insulation of solid wall properties.
Kevin Hollinrake
I absolutely agree. We need a new scheme. Owing to the demographic of our housing stock, we have some of the least energy-efficient housing stock in Europe.
We must also be pragmatic. Only 7% of our energy comes from renewables today, and fossil fuels will be part of the mix for the foreseeable future. There is an MI5 maxim that we are only four meals away from anarchy. We are probably only two dark days and nights away from anarchy, too. Natural gas is the cleanest fossil fuel, and we have to keep the lights on.
Ian Lavery (Wansbeck) (Lab)
There has to be an understanding that shale gas—natural gas—is a fossil fuel, and that if we continue to burn it in ever-increasing amounts to replace the coal-fired power stations without carbon capture and storage, we will never hit the limits that we have just agreed in Paris only a week ago.
Kevin Hollinrake
I will come to that point shortly.
Let us look at the situation in the US, which is the second biggest emitter of carbon dioxide. According to the United Nations Intergovernmental Panel on Climate Change, the US has made great progress on reducing greenhouse gas emissions, and an important reason for that is its production of shale gas. Environmental campaigners such as Stephen Tindale of Climate Answers and the Labour shadow energy Minister, Baroness Worthington, have expressed support for fracking as a way to reduce carbon emissions but, crucially, only in conjunction with investment in carbon capture and storage and low-carbon energy generation, storage and distribution.
There is a shale gas application in my constituency. Having heard both sides of the debate over many months, I decided to visit Pennsylvania, where fracking has happened, to see whether it is possible to do it safely and in a way that does not industrialise the countryside. I believe that that is possible, but we need to paint a picture for local people to show them that. At the moment, we are losing the PR war with those who are simply against fossil fuels per se. Fossil fuels are going to remain part of the mix.
Our regulations are strong—they are certainly much stronger than those in the United States—but I believe that we need a lead agency and independent supervision of the regulations. I also believe that we need a local plan, so that residents can see how their area will change or, as I believe, not change. In my constituency, there are already 10 conventional gas well sites, and most of the residents do not even know where they are. The local producers say they will need another 10 more sites and, crucially, 950 wells. That scares people, but 10 more sites are relatively easy to screen. In my constituency, there are hundreds of pig and poultry farms whose visual impact is much greater than that of a fracked well site.
We must win the argument publicly, so that people can see that fracking will not change the nature of their countryside and that it can be done safely. We must proceed cautiously. We must produce the evidence, and ensure that the public have full access to that evidence, if we are to win the argument. We are in an age of wonderful technology and we can paint a picture through computer-generated images and time-lapse photography to show people how it is possible to move towards a much cleaner source of fossil fuels and to provide an important bridge to a carbon-free future.
Madam Deputy Speaker (Mrs Eleanor Laing)
Order. My prediction about time not standing still during interventions was, I am afraid, correct. I shall now have to reduce the time limit to four minutes.
Callum McCaig (Aberdeen South) (SNP)
Floods are clearly devastating at any time, but never more so than at this time of year. We have heard a number of eloquent speeches about the devastation that the floods have wrought, but we also need to remember that we are in a fortunate position, as a rich advanced nation, in that we can afford to rebuild, to rehouse and to protect those who are affected by flooding. Those who are affected by climate change in other parts of the world will not be so fortunate.
For me, the stand-out aspect of the Paris agreement was the $100 billion for the mitigation of climate change. That will allow the poorest nations access to the finance they need to develop in a way that will allow the planet to be protected. It will also give us the opportunity to lock in low carbon emissions without locking in poverty. That is fundamental to the way in which we deal with what has rightly been described as the greatest threat that humanity is facing.
My hon. Friend the Member for Berwickshire, Roxburgh and Selkirk (Calum Kerr) mentioned the Scottish Government’s climate justice fund, and we as a party are rightly proud of that. This is not a devolved matter, but we have sought to put our money where our mouth is. That money has to be seen as an additional contribution, however; it cannot be taken out of the pot because of what we have done. That needs to be respected nationally and repeated internationally.
We have had many debates in this place on the changes that have been made to the renewables obligation and to the green economy more widely. It disappoints me to state that our target in Scotland of a 100% renewable electricity generation is under threat because of changes to the renewables obligation and the prevarication over contracts for difference. There has also been much slower progress over heat, which represents a bigger challenge in relation to carbon reduction. It is pleasing that there will still be some form of support through the renewable heat incentive, but in the context of what we are dealing with following Paris, the £700 million that has been taken out seems like yet another short-sighted move.
Speaking of short-sighted approaches, the decision on carbon capture and storage is one of the worst that we have heard, and I will continue to bang the drum about that. There has been prevarication over CCS for a number of years. This process just needs to be done. We are talking about spending billions of pounds to prevent the symptoms, but we are not trying to tackle the cure. If we were to put £1 billion into carbon capture and storage, the reduction in the impact of flooding would be a potential game changer. Using carbon capture and storage is the most straightforward way of dealing with the matter. It also has the least impact on our economic model. It allows us to extract the fossil fuels that we discussed—shale, North sea oil or whatever—without having to invest. We will still have to invest in other technologies, but this gives us an opportunity.
Barry Gardiner (Brent North) (Lab)
Did the hon. Gentleman share a sense of comedy yesterday when the Secretary of State spoke on this matter? She said:
“I believe that CCS is going to play an important part in decarbonising in the future”.—[Official Report, 14 December 2015; Vol. 603, c. 1297.]
She then went on to say that, just for now, the Government are cutting the £1 billion subsidy towards it.
Callum McCaig
It was comedy of the blackest sort. It is short-sighted and it does not take into account how we can target the reduction at industry, as has been ably suggested.
The action here falls very short of the rhetoric, and very, very short of what is required to deliver and protect those people, both at home and abroad, from the impact of climate change. We need to up our game. It is time that we reset the reset button. I am happy if we in the Scottish National party join the high ambition coalition of the right hon. Member for Doncaster North (Edward Miliband) here in the UK. The SNP is more than ready and willing to play our part in achieving that ambition.
Luke Hall (Thornbury and Yate) (Con)
May I associate myself with those who have expressed their condolences to the victims of the floods? I congratulate the hon. Member for Workington (Sue Hayman) on such a powerful speech on behalf of her constituents: I can certainly picture myself at the bottom of my high street in such a situation.
I am one of many MPs across the House who regard climate change as one of the most serious long-term economic and environmental threats that this country and our world face, although I had not quite appreciated the threat it posed to haggis, which was mentioned earlier.
Earlier this month, I, along with other Members, attended the GLOBE conference in Paris, where legislators, leading members of the judiciary, policymakers, the scientific and academic community, and business and civil society gathered to discuss the challenges in Paris and the post-2015 agenda.
We heard contributions from Deputy Jean-Paul Chanteguet, president of GLOBE France, Jacqueline McGlade, chief scientist on the United Nations environment programme, Helen Clark, former President of New Zealand, Senator Ed Markey, and legislators from around the world. A cross-party delegation of MPs from the UK included members of the Energy and Climate Change Committee and the Environmental Audit Committee. We were ably led by the hon. Member for Ogmore (Huw Irranca-Davies). When the Secretary of State sums up, perhaps he will mention the contribution of the GLOBE conference to the debate.
The feeling that I gauged during the conference was one of cross-party consensus and support for the ambitious deal in Paris. The presence of such a strong delegation from the UK was vital. I pay tribute to my hon. Friend the Member for Beverley and Holderness (Graham Stuart), who chaired the conference so ably.
The commitment by 195 nations to attempt to cut greenhouse gas emissions to a level that will limit the global average temperature is truly historic. Inaction on climate change would cost us a great deal more than shifting to a decarbonised, climate-friendly way of life. I particularly welcome the legally binding, regular reviews and submissions of emission reduction targets. It is important that those countries will now have to come together regularly to review their climate plans and collectively ensure that the necessary action is taken to tackle climate change.
Countries being legally obliged to make new post-2030 commitments to reduce emissions every five years from 2025 is a welcome step forward. I also welcome the $100 billion fund from developed economies to help emerging and developing nations decarbonise their energy mix, which will provide welcome support to aid the transition from burning fossil fuels to clean energy sources.
Decarbonisation will have to be a key part of the UK’s fiscal policies—lip service will not be enough. I am confident that the Secretary of State agrees with me on that point.
Richard Graham (Gloucester) (Con)
My hon. Friend is making some powerful points about the importance of the climate change deal in Paris. Bringing it down to a local level, where he and I both live, does he agree that it is incredibly important that, this month, the snappily named “Severn River Basin District: flood risk management plan” is published, which will be on top of local flood resilience plans, because he and I both know the devastating impact that climate change has had on the River Severn and on our local areas?
Luke Hall
I thank my hon. Friend for that point. I completely agree with him about the importance of that plan. I will do everything I can to help him work on it in the future.
I also thank the Secretary of State for her assurances during that conference that she would do everything possible to secure an ambitious deal. I commend her for playing such an important role in the successful negotiation. The deal sets out a clear long-term goal of near net zero emissions by the end of the century, and it represents a huge step forward in securing the future of our planet.
Huw Irranca-Davies (Ogmore) (Lab)
It is a privilege to speak in this debate and to follow the hon. Member for Thornbury and Yate (Luke Hall), who is a fellow member of the Environmental Audit Committee.
I will take leadership as my theme today. I am talking about the leadership that has been shown during the negotiations not just by the Secretary of State for Energy and Climate Change but by the whole team that was out there. I was delighted to meet up with Lord Nick Bourne, an old colleague of mine from Swansea institute, and to urge him to show that leadership. The outcome was good, but I am sure that the Secretary of State and her team will agree when I say that it is as nothing unless we now rise to the challenge that it has set up. We are looking at 3.5° to 3.7° based on our current trajectory of global warming. If all the actions within the current package are delivered, we may be able to achieve 2.5°, or even 1.5° if we ratchet up our actions every year or every five years. The scale of this transition is huge; it is enormous. We cannot base it on our current plans, so the leadership that has been shown should be commended. We now need that leadership to turbo-charge what we do both here within the UK and in our international negotiations.
Once again I applaud the leadership that has been shown on the ground in areas of flooding, including in Hawick in Northern Ireland, in Wales, and in Workington, the scenes from which were described in the remarkable and emotional words of my hon. Friend the Member for Workington (Sue Hayman). I was in Workington back in 2009, after what we thought was the worst flooding we had ever seen. That came on the back of the 2005 floods, and here we are again. Back in 2009, more than 2,200 properties and 250 farms were affected, 25 bridges were closed, and 40 waste treatment works were closed—again there is that issue of resilience—and here we are again.
In response to the hon. Member for Monmouth (David T. C. Davies), whom I love dearly, I have to say that he is completely wrong. We are not talking about this one event being down to climate change. It does not matter whether we are talking about the traumatic incidents in Cumbria, Scotland, north Wales, Ireland, Bangladesh, or the Maldives, it is a pattern of climate change that is unarguable and we must deal with it.
In the short time available, I must say to the UK Government that, if we are to make the Paris commitments work and go further, we really need a step change now. We need to go further on the international stage. I strongly urge the Minister and her team to go back and look at what we are doing at an EU level. I suggest that we are not being ambitious enough to meet that 1.5° or 2° target. In terms of this country, the right hon. Lady has admitted that we have a policy vacuum at the moment, specifically in regard to the closure of various schemes. I will not argue the pros and cons of it, but we have a policy vacuum none the less, whether it relates to energy efficiency in homes, the type of clean green energy that we produce, demand reduction, or residential or commercial properties. We are consistently being told by business people and others that there is a policy vacuum in all those areas.
Neil Parish
Does the hon. Gentleman not agree that a tidal lagoon in Swansea would be a very good way to produce tidal energy, and that we could use that idea all around the United Kingdom?
Huw Irranca-Davies
My admiration for the hon. Gentleman has gone up hugely, because I was not going to be able to get in that point. He is right. We were a little frustrated by the lack of announcements on the Swansea Bay lagoon and strike prices in the autumn statement. Let us now see a commitment that will take forward not only the Swansea Bay lagoon, but the Cardiff Bay lagoon and all the ones that come after it. One of my recommendations to the Secretary of State would be this: let us use this as an opportunity to create jobs and to be a world leader so that we can export that technology, that know-how and those jobs. It is there for the taking. When Stern warned us about the challenges of climate change, he told us to make the early investment to save money down the line. That is what we must now do.
Rebecca Pow
I have enormous respect for the hon. Gentleman, the Chair of the Environmental Audit Committee. I wonder whether you might want to comment on this: with the plan you are suggesting, we need much more—
Madam Deputy Speaker (Mrs Eleanor Laing)
Order. I am not suggesting anything. It is “he” or “the hon. Gentlemen”, not “you”.
Rebecca Pow
I apologise, Madam Deputy Speaker.
Will the hon. Gentleman comment on whether we need more detailed inspection within Government Departments so that we are all doing our bit? We have a green investment strategy in the Department for Transport, but what about all the other Departments? Should we be working together more?
Huw Irranca-Davies
The hon. Lady, who is so committed on these issues, is absolutely right. The approach needs to be cross-departmental and rigorous, and it needs a step change. We have been trying to turn the supertanker around slowly, but Paris says that that is not fast enough. Lord Deben, the chair of the Committee on Climate Change, has said that we need to do more. We heard recently from the head of the National Audit Office, who said that we need joined-up thinking and leadership in government. The hon. Lady is absolutely right.
One of the biggest commitments the Government could make—the Secretary of State and her team would have my support—is fully to accept what the Committee on Climate Change says about the outcomes of Paris. It said in its June report that we need to go further and faster. We will now need to go faster again and deliver more. There are opportunities with that. I ask the Secretary of State to accept that—I ask her to do it and get on with it, and in fact go beyond it if she can. She should look at how we can do that. What technologies should we invest in? Where will the private sector put its money? What do we do with the green investment bank? How does it play its part?
The Secretary of State should also fill the current gap from the fourth carbon budget. That is to do with leadership. It is great coming back from Paris with excellent commitments—they are better than many people were expecting. The UK played a leadership role there. We now need to take it to a whole other level. Paris means that it is not business as usual for us or for many other nations. Let us keep on leading and let us go further. I look forward to the Secretary of State saying how we will do that.
Tom Elliott (Fermanagh and South Tyrone) (UUP)
It has been an interesting debate and it is interesting to follow the hon. Member for Ogmore (Huw Irranca-Davies), who spoke about his views on climate change.
We have talked a lot about the Paris deal. We have that relationship and what will turn out to be an historic agreement. I want to highlight another historic agreement —one made between the Northern Ireland Government and the Republic of Ireland Government back in 1950, which also included the Westminster Government. At that time, there was an agreement between the three Governments to have a hydropower station in the Republic of Ireland using the water that flowed from Lough Erne.
I am disappointed that the motion does not mention Northern Ireland at all. At least 16 roads are closed in my constituency and huge amounts of damage have been done to businesses and homes. Like other constituents in Cumbria, Scotland and other places, a number of my constituents will not be in their homes for Christmas, which is a demoralising situation. Local businesses—family-owned businesses—have lost more than £100,000 of stock and a lot of their Christmas business. That is devastating for them and for me, and it might actually put some of them out of business.
The farmlands, which have been highlighted, are where the agreement between the Republic of Ireland and Northern Ireland come into play. The levels of Lough Erne have not been investigated since 1950. We need that historic agreement to move on and we need a review of it. We need to ensure that some of the actions that took place at that time—in other words, dredging Lough Erne and ensuring that the levels were safe and reasonable—need to be carried out once again.
I appreciate that that is a devolved matter, but I am asking the UK Secretary of State to speak to the Department of Agriculture and Rural Development Minister in Northern Ireland to see whether there is flexibility and whether another agreement is needed from Westminster, just as there was in 1950. I note that the Secretary of State indicated a special finance scheme or a special scheme for farmers. I wonder whether there will be a knock-on effect, perhaps through the Barnett consequentials, to help farmers in Northern Ireland to clean up. It is important that we get assistance just as people in Cumbria in England and other places in Scotland will get assistance.
My colleagues from Scotland talked about the situation there. Unlike the Departments in Scotland, Departments in Northern Ireland have not dealt with the situation as well. People and staff on the ground have been very effective in helping businesses, domestic homes and farmers, but the Departments have not been effective at the wider aspect of planning. That is a key aspect. We do not want a repeat of what has happened this year. We had the same situation in 2009 that is being repeated six years later. We do not want another repeat in another four or six years.
I am appealing to the Secretary of State and the Government to do all they can to ensure that this does not happen again and, in my case, to liaise with officials and Ministers in the Northern Ireland Departments.
Several hon. Members rose—
Madam Deputy Speaker (Mrs Eleanor Laing)
Order. While we had time limits of four or five minutes, several Members spoke for seven or eight minutes. They know who they are. Those who are still to speak can feel aggrieved—they can take it up with them and not with me. I therefore have to reduce the limit to three minutes.
Cat Smith (Lancaster and Fleetwood) (Lab)
I speak as the Member of Parliament for Lancaster and Fleetwood, a constituency that was affected by Storm Desmond and recent flooding. Although we are not in Cumbria, I urge hon. Members to remember that the effects of the flood went beyond those county boundaries.
I pay tribute to the role of The Bay, our local commercial radio station, which continued broadcasting. For many people, it was their only source of communication with the outside world for four days because we lost power. The station managed to get back online despite being flooded and despite power cuts to keep local people informed.
A lot has been said about the effects of the flooding of the city centre in Lancaster, but I want to say something about the impact on the Lune valley, a beautiful part of Lancashire that has a big farming community. I thank Jenny Walmsley, the chair of the Caton-with-Littledale parish council, who helped to introduce me to many more people I did not already know in that area. I welcome the news from the Government today about the support for farmers and look forward to seeing it go online.
The floods in recent weeks are consistent with what we should expect in a warming world. Met Office data show that annual rainfall has increased in the UK since the 1980s. Five out of the six wettest years on record have occurred since the start of the new millennium. That is a warning that I heed.
Businesses in my constituency have been badly affected. I pay tribute to the business people who stepped up and played a role when the water breached and flooded the city centre, including Mark Cutter, the landlord of the Robert Gillow pub. He opened up his pub and allowed people in when they were unable to return across the river after their Saturday nights out because the bridges had been hit by a shipping container. That reminds us of the force of nature. People enjoying the nightlife in Lancaster were stranded in our city centre.
Small businesses are particularly at risk from flooding and 52% of them do not have flood insurance. My fear is that that will increase in my constituency because insurance premiums will certainly increase. The Environment Agency’s long-term investment scenarios recommend an optimum overall investment of around £470 million a year more than is currently being spent. Therefore, the Government need to spend £2.5 billion in the period from 2015 to 2021. That might sound like a lot of money but, frankly, the cost of doing nothing is far greater than the cost of investing in protecting our communities from floods. I have seen first hand for the first time the devastation in the area where I live. I call on the Government to support our councils as they do their best to deliver. It should not take another flood for the Government to realise their mistake. I also call on them to take climate change and flood defences seriously.
Ronnie Cowan (Inverclyde) (SNP)
UK Government analysis shows that global warming is expected to cause more intensive heavy rainfall events and we have to ask ourselves whether we are prepared for the ramifications of the changes in our weather.
The Government have set up a national flood resilience review in England and a report will be published in summer 2016. I hope the review will look far and wide for innovative, sustainable solutions, because it has rained before, it has flooded before and we have had reviews before. A solution will not be found by more parliamentarians navel-gazing. The cry of, “I want to make things right, just not right now” is how we fail to make things better. I hear the Government promising, over the next six years, £2.3 billion in capital funding on flood defences and I acknowledge that in 2014-15 the Government spent £171 million of taxpayers’ money on flood maintenance. But just like the wee boy with his finger stuck in a dam, required as these actions are, they do not solve the problems.
We have two problems facing us. First, we are screwing up our own environment—let us be absolutely clear about that. Turning that around is a massive task that sticking plaster politics will not address, yet the Government have decided to cut investment in carbon capture and storage technology, reduce funding for solar energy and block the growth of wind energy. Secondly, we need to find a way to alleviate the flooding we now see on an annual basis. Every additional instance of flooding means more lost revenue for local businesses or damage to homes. We owe it to our constituents to meet or exceed our targeted timeframes for tackling this issue.
We must also recognise that the way we have changed the environment has left us more exposed to the risks of flooding. We should give serious consideration to reforestation as one method of assisting flood prevention. Trees catch rainfall and take water from the soil. With careful planning, they could be our first line of defence. Managed correctly, trees lead us to the next logical stage: utilising biomass boilers can maintain a closed carbon cycle with no net increase in atmospheric carbon dioxide. If all public buildings used biomass boilers and could source their fuel, primarily wood pellets or wood chips, locally, we would start to see a coherent localised industry employing local people as part of an environmentally friendly solution.
Reforestation is just one of many policies we could implement to improve our catchment management in the longer term. Contour ploughing, restoring upland bogs and reintroducing the meanders in straightened rivers are other measures we may wish to consider as we seek more permanent solutions. One change will not fix the problem, but a series of correct adjustments will help in a number of different ways. Whether it is reforestation or tackling climate change, it is time for us to be bold with our policy making and ensure that no more lives, businesses or homes are ruined by flooding.
Geraint Davies (Swansea West) (Lab/Co-op)
It is a pleasure to follow the hon. Member for Inverclyde (Ronnie Cowan). I speak as a former chair of Flood Risk Management Wales, responsible for adapting Wales to climate change in terms of flood defences and investing the Welsh Assembly’s money through the Environment Agency and partners. I will be talking about adaptation.
On Paris, I will simply say that the Secretary of State needs to look carefully at the fact that the environmental imperatives agreed in Paris are not enforceable and binding in the Transatlantic Trade and Investment Partnership and the Comprehensive Economic and Trade Agreement, on which the Government are moving ahead.
On adaptation, we took evidence from Kuala Lumpur, which was drowned in water every year until it put in storage lakes upstream and tunnels underneath. In addition to woodland and so on, we need to consider the option of major capture and diversion of rivers upstream to stop flooding. On urban drainage systems, we need to consider the use of water butts. It is not enough just to have a few bits of grass verge for absorption; all public buildings—and, arguably, all new build—should have butts. Butts store water from the roof, which is then leaked down over a period of days, rather than just swept through the sewerage system all at once. The sewerage system, of course, takes floodwater and sewage. When it all comes up through the drains, everything is ruined. We can stop that happening by capture and storage on roofs. That would save enormous amounts of money.
On housing, we have heard that not enough is being spent on defences and maintenance, so defences can give a false sense of security. There needs to be investment not only on defence but on common-sense resilience too. Raising plugs on walls, installing steps on entry into houses and waterproofing downstairs would mean that after flooding, people could get back to their normal lives. Many people die from the trauma of flooding.
On insurance, poor people cannot get insurance. There should be local government schemes for insurance. That would also incentivise local authorities not to build on floodplains, which they do. Regardless of what the Environment Agency says, a lot of local authorities just keep on building. We need to ensure that we have sufficient emergency services, including armed services. Finally, we need to ensure the ratio of cost to value—we have heard some of the ratios today, such as 4:9. We need to ensure that poor people in low-value houses are protected. In Wales, we have changed the system, so it is not just those who live in a rich property area who receive flood defence. Those who are poor are protected and can get insurance. It is vital that we invest in adaption and I wish the Secretary of State the best of luck.
Dr Lisa Cameron (East Kilbride, Strathaven and Lesmahagow) (SNP)
I am delighted to speak in this debate as the Scottish National party spokesperson on climate justice.
The flooding caused by Storm Desmond, which affected large areas of north-west England, southern Scotland, north Wales and Northern Ireland, has had devastating effects. At a time when most of us are looking forward to Christmas and trying to be organised for the forthcoming festivities, those most severely affected by the flooding are likely to be facing a more bleaker festive period away from their homes for the imminent future, with a significant clean-up process ahead of them. Our thoughts are first with those affected and we express our gratitude to all the emergency services involved alongside communities and local councils.
This is not an isolated event, however, and over recent years there have been a number of extreme floods in the UK, both during winter and summer months. Some people have experienced floods on multiple occasions. Extreme floods have a substantial human, emotional and financial toll on the individuals and communities affected, both in the immediate aftermath and over the long term. Flooding leads to homes and businesses having to be evacuated, loss of power, and to public amenities and transport links being closed. Most tragically of all, it has resulted in a number of fatalities.
In Scotland, the Scottish Government are very aware of the impact of climate change, both domestically and globally. They have introduced pioneering policies which aim to alleviate the effects of climate change both in Scotland and in developing countries across the world. In this regard, the Scottish Government have been investing in a number of initiatives to reduce carbon emissions and Scotland is well on its way to meeting its world-leading target of a 42% reduction in emissions by 2020. We have also made significant progress on building renewable energy resources, which, as well as providing a sustainable energy supply, promotes jobs and growth.
Patrick Grady
Does my hon. Friend recognise the contribution the Scottish Government have made, with the announcement of the £12 million climate justice fund to be extended over the next four years? Does she agree with my hon. Friend the Member for Aberdeen South (Callum McCaig) on the importance of climate justice funding, including the $100 billion a year in addition to existing aid flows?
Dr Cameron
My hon. Friend’s intervention is timely, as I was just moving on to those very points.
The Scottish Government are aware of the importance of supporting developing countries around the world, and have been encouraging investment in their climate justice fund. In the past five years, the climate justice fund has already invested £6 million in 11 projects in four sub-Saharan African countries. In Malawi, for example, about 30,000 people now have access to safe, clean drinking water and over 100 communities have been trained in natural resource rights and management. The Scottish Government have also announced they will double their climate justice fund by pledging a further £12 million for developing countries to help lessen the impacts of climate change. This is important because it is recognised that richer countries have polluted more and for longer, and that we therefore have a responsibility to ensure developing countries can adapt adequately to climate change.
I applaud the hard work that UK Ministers, Scottish Ministers and Governments across the world put into the COP 21 agreement in Paris. I was honoured to play a small role by attending the legislators summit hosted by GLOBE International. I also had the pleasure of visiting the London Natural History Museum during recess. It got me thinking about global climate change and how it hit the dinosaurs of the past and led to their extinction. Climate change is not new, but it is once again reaching crisis point. We must learn the lessons of the past, not be the dinosaurs of the present, and protect this world for future generations.
Liz McInnes (Heywood and Middleton) (Lab)
I am grateful for the opportunity to make a brief contribution to this fascinating debate.
As many hon. Members have pointed out, just six years ago Cumbria was hit by unprecedented floods, and once again, this year, it has been hit by unprecedented rainfall. More than a month’s rain fell in one day on Saturday 5 December, and main rivers across Cumbria exceeded the highest levels ever recorded. Storm Desmond led to road closures, rail disruption, school closures and loss of power supply to many homes and businesses owing to unforeseen flood damage at a substation in Lancaster, as a result of which hospitals had to work on emergency generators and Lancaster University had to declare the end of term one week early. I had my own, small experience of this: on Sunday 6 December, we had to drive to Lancaster to rescue our son from the university, which had been without power since Saturday evening. Surely power stations should be protected from flooding to prevent such disruption to our healthcare, education and business institutions. I am pleased that the Secretary of State has announced a national flood resilience review to assess our infrastructure, including electricity substations.
I want to mention the creation of a statutory duty on the fire and rescue service to respond to flooding. The Fire Brigades Union argues that a statutory duty on firefighters to attend floods would help fire and rescue services, other emergency services and the Government to plan effectively and reduce risk to life and property, and indeed such a duty has already been adopted in Scotland and Northern Ireland. The response to the recent floods has shown the emergency services, the military and the British people at their best. Communities have rallied round and helped those in need of shelter, food and clothing—they have been magnificent—but they need action and support from a Government who have failed to take the flood threat seriously.
Not only are better flood defences needed, but cuts to emergency services need to be addressed. Five fire stations in Cumbria are set to close in the latest round of money-saving measures. It sounds like a statement of the obvious, but we cannot go on cutting the fire service, while expecting it to do more and more. I am grateful to my hon. Friend the Member for Bristol East (Kerry McCarthy) for quoting the Prime Minister’s words:
“After every flood the thing to do is sit down, look at the money you are spending…and ask is it enough.”
Clearly, it is not enough. The Government’s “cut first, think later” approach is failing communities blighted by flooding.
Lisa Nandy (Wigan) (Lab)
I thank hon. Members on both sides of the House who have given a voice to communities affected by flooding today. We called this debate to give those communities a voice, and Members who have spoken have done those communities proud.
Members have done something else: they have given a voice to all of us who are deeply concerned about the costs of inaction on climate change and what it will mean for the UK. There is a remarkable degree of consensus—with the exception of the hon. Member for Monmouth (David T. C. Davies)—about the clear link between climate change and the emerging trends in flooding. The Met Office analysis suggests that global warming at or above 2º from 1990 levels will increase the risk of extreme floods by a factor of seven. It is becoming increasingly clear that the sort of rainfall and flooding once seen as rare—as once-in-100-years events perhaps—seem to be happening more frequently. It is right that the Government have acknowledged that.
The Government’s own adviser on climate change, Lord Deben, said that
“if global greenhouse gas emissions do not peak soon and start to fall, 4 or more degrees of warming could take place this century. This would lead to severe and unavoidable…flood risk”
and result in an extra 1 million homes being exposed. The Committee on Climate Change has warned that the annual cost of flood damage to the UK could increase from £1 billion to £5.6 billion by the 2080s.
In her short but moving contribution, my hon. Friend the Member for Lancaster and Fleetwood (Cat Smith) made us understand the human consequences, and as her neighbour, my hon. Friend the Member for Barrow and Furness (John Woodcock), said, this is about the future. The Committee on Climate Change said that the Government’s national adaptation programme lists a range of useful activity, but that it does not amount to a coherent programme. I say to Ministers today that they must urgently rectify that. My right hon. Friend the Member for Don Valley (Caroline Flint) said that we need a real plan—a long-term plan, as the hon. Member for Westmorland and Lonsdale (Tim Farron) also pointed out.
We also need to recognise, as the hon. Member for Thornbury and Yate (Luke Hall) made clear in his contribution, that inaction has a cost. These are lives, homes and livelihoods that are on the line. The hon. Member for Aberdeen South (Callum McCaig) said that we are spending billions tackling the symptoms and not the cause. Quite frankly, we cannot go on like that.
Last week, my hon. Friend the Member for Bristol East (Kerry McCarthy) and I called for a new flood risk assessment, and I would like to take this opportunity to commend the Environment Secretary for agreeing to that. What that will not be able to do, however—given that we have to wait until 2017 for the national climate risk assessment—is fully account for the latest understanding of climate change impacts on UK flooding. I therefore ask the Secretary of State for Energy and Climate Change today whether she will bring that forward. Will there be a new national climate adaptation plan to follow those reviews?
As my hon. Friend the Member for Ogmore (Huw Irranca-Davies) said, the leadership shown in Paris must be followed by leadership at home, so I take this opportunity to ask the Secretary of State the following again. Will she take the chance presented by the Paris accord and stop the sell-off of the Green Investment Bank, and stop blocking onshore wind where there is strong local support for it? Will she take this chance to make real progress on the Swansea bay tidal lagoon, and will she find the money to fulfil the promise made by successive Governments to coalfield communities to give us carbon capture and storage, so that those communities have the chance to build the future of energy and future jobs? Will she think again, too, about the deep cuts made to the solar industry—just at the moment when it stood on the cusp of becoming economically viable?
Many Members talked about the need to take the public with us on the journey to climate safety. Just as communities such as mine in Wigan helped to build this country’s prosperity through dangerous, difficult and dirty work down the coalmines, so young people in communities such as Wigan and across the country should be given the chance to build and power the future through jobs in solar, wind and CCS.
The UK team—the Department for Energy and Climate Change team and officials, the Foreign and Commonwealth Office and the hon. Member for Beverley and Holderness (Graham Stuart) as chairman of GLOBE International—showed in Paris this weekend just what is possible if we put our minds to something, raise our ambition and work together to build the future. In so doing, they built on a proud record of leadership shown by the UK—from 1997 and Kyoto to the Climate Change Act 2008, led by my right hon. Friend the Member for Doncaster North (Edward Miliband) and David Miliband. Again, in 2015, I was proud to stand with 50 Labour councils around the UK that have pledged to go clean by 2050.
As my hon. Friend the Member for Heywood and Middleton (Liz McInnes) said, we owe our thanks to the emergency services, the armed forces, the charities, the businesses and the individuals who are doing what they can now to help those families whose homes are under water. We owe it to them to understand the risks and to take action to prevent future flooding.
If the Secretary of State will not listen to me, will she please listen to the powerful and moving speech made by my hon. Friend the Member for Workington (Sue Hayman) about homes under water, children frightened of the rain, shopkeepers devastated and extraordinary acts of courage from members of the public? This is the courage we need now from the Secretary of State. The costs of inaction on climate change are right before us. I ask the right hon. Lady to show the leadership that we so desperately need, because the alternative is unthinkable.
The Secretary of State for Energy and Climate Change (Amber Rudd)
I thank the Labour party for bringing this issue to the House, and I thank all the Members who have taken part in what has been an animated and energetic debate.
The exceptional rainfall that we have seen over the past couple of weeks has led to some very distressing situations for families and businesses in parts of the country where serious flooding has occurred. The hon. Member for Workington (Sue Hayman) did indeed speak movingly about the impact on her constituency, but the hon. Member for Barrow and Furness (John Woodcock) reminded us that, despite that devastation, communities were open for business. I thank the hon. Members for Inverclyde (Ronnie Cowan) and for Berwickshire, Roxburgh and Selkirk (Calum Kerr) for describing the experience in Scotland. I also thank the hon. Member for Fermanagh and South Tyrone (Tom Elliott). He reminded us to liaise closely with our Northern Ireland counterparts, which we will of course do.
Like many other Members, I pay tribute to the work of the emergency responders, including the fire service—especially in view of the example given by the hon. Member for Heywood and Middleton (Liz McInnes)—and the volunteers who have worked tirelessly to return people to safety, to restore power supplies, and to clean up quickly so that people can return to their homes as soon as possible.
Ian Lavery
It has been said time and again how valuable and heroic the fire and rescue services have been in cases of flood, including those in not just Cumbria but Northumberland this week. Why is there so much resistance to giving them a statutory duty to carry out floodwater rescues?
Amber Rudd
Several other Members have made the same suggestion. All I can say at this stage is that I hope various Ministers will continue to consider it, because I share the hon. Gentleman’s admiration for all the effort and work that the fire and rescue services have put into helping people.
Over the next six years, we will invest £2.3 billion in flood defence. That is a real-terms increase on the £1.7 billion that was invested during the last Parliament. The hon. Member for Swansea West (Geraint Davies) made some helpful suggestions about future spending on mitigation, while the hon. Member for Lancaster and Fleetwood (Cat Smith) called for more support. I remind the hon. Lady that £60 million has already been invested in flood defences to protect Fleetwood. More than 200 schemes are currently being constructed in England, and we will deliver on our manifesto commitment to provide better protection for 300,000 more homes.
Amber Rudd
I know that the hon. Gentleman recognised the enormous effort that had gone into support for Cumbria, and that he made some additional suggestions, which I will certainly pass on to my right hon. Friend the Chancellor.
Tim Farron
I can help the Secretary of State to find some of the sources of funds that would partly satisfy my requests. Her right hon. Friend the Secretary of State for Environment, Food and Rural Affairs said earlier that one reason why a bid might not yet have been made for EU solidarity funds was the fact that they would take seven months to come through. Will she confirm that Commissioner Cretu made clear today that 10% of any award from the solidarity fund could be provided immediately to help us to carry out work such as the rebuilding of the A591?
Amber Rudd
I have been reliably informed by my right hon. Friend the Secretary of State for Environment, Food and Rural Affairs that the Department for Transport is already dealing with the matter, so the hon. Gentleman may well see some action in that regard.
Amber Rudd
I am going to make some progress now, because we are very short of time.
There is a link between climate change and an increase in extreme weather events. I do not share the views of my hon. Friend the Member for Monmouth (David T. C. Davies), who always speaks with enthusiasm. Let me say to him that, while we cannot attribute every storm, drought or flood directly to climate change, all the evidence from our scientific understanding of weather systems suggests that our changing climate will lead to more intense and more frequent events. Last month, the Met Office released papers from its study of the exceptional rainfall of 2013-14. It found that, given the same weather pattern—a persistent westerly flow—extreme rainfall over 10 consecutive winter days might be about seven times more likely now than it would be in a world without man-made greenhouse gas emissions.
Of course natural influences will still be an important factor, but it is clear that the impact of climate change is already being felt, especially in vulnerable countries, which is why the hon. Member for East Kilbride, Strathaven and Lesmahagow (Dr Cameron) was right to comment on the need to assist developing countries with additional funds. Unless we limit the rise in the global average temperature, we shall have to live with more extremes. That is why the global agreement that was reached in Paris this week is so important. As we heard from the right hon. Member for Don Valley (Caroline Flint), the French played a very important role in ensuring that it all came together.
No single country, acting alone, can hope to limit climate change. Only by acting together can we hope to succeed. With nearly 200 countries coming to an agreement, the Paris conference was a clear turning point towards a sustainable and low-carbon future. If we limit the global average temperature rise, we will limit the intensity and frequency of extreme weather such as the flooding we have seen recently.
Barry Gardiner
On limiting that extreme weather, the Secretary of State will recall that the Chancellor mentioned 300,000 properties whose flood risk was being reduced. Is she aware of the Chartered Institution of Water and Environmental Management report, which has said that
“this largely moves properties from a low risk to an even lower one”?
In other words, the Department for Environment, Food and Rural Affairs has asked officials to achieve the maximum number instead of the most—
Amber Rudd
I am jealous of the time the hon. Gentleman is taking off me, and I will allow the Secretary of State for Environment, Food and Rural Affairs to respond on that point. I wish to make some progress, so that I can cover the interesting comments made by other Members.
With a global agreement, we signal to business that this is a definitive turning point. Business is crucial for delivering on our ambitions, as my hon. Friend the Member for Beverley and Holderness (Graham Stuart) ably set out. He was in Paris over the weekend, leading with GLOBE International, where he was accompanied and supported by my hon. Friend the Member for Thornbury and Yate (Luke Hall). We know that in isolation, cuts to Britain’s own greenhouse gas emissions, which comprise just 1.2% of the global total, would do little to limit climate change. Our most important task therefore is to provide a compelling example to the rest of the world on how to cut carbon while controlling costs. The hon. Member for Aberdeen South (Callum McCaig) has many spending commitments to recommend to us, but no more. In a tight spending review, he should welcome at least the increase in the renewable heat incentive budget. We are committed to meeting the UK’s 2050 target. We are on track for our next two carbon budgets, and we will be setting out our plans for meeting the fourth and fifth carbon budgets next year. My hon. Friend the Member for Warrington South (David Mowat) questioned the fairness of the EU target of a 40% reduction by 2030, and I share his concern to ensure that it is fair. I can reassure him that we will be addressing that when we approach the effort sharing decisions next year.
We need to get the right balance between supporting new technologies and being tough on subsidies. When costs come down, as they have for wind and solar, so, too, should support. I share the enthusiasm of my hon. Friend the Member for Wells (James Heappey) for solar, but we will also always look after the bill payer. That is why I have announced that we will support and accelerate the cost reduction also being seen in offshore wind by making funding available for a further three auctions during this Parliament. That and other measures, such as supporting new nuclear and gas-fired power stations to provide a lower carbon base load, could provide us with the energy security we need to close unabated coal. We have also committed to double spending in clean energy research and development, so that by 2020 we will be spending in excess of £400 million. That is in recognition of the fact that we will tackle climate change only if we find technologies that are both clean and cheap.
Amber Rudd
I am sorry, but I will not give way. As I was saying, that is the answer to the question put by the right hon. Member for Doncaster North (Edward Miliband) about ambition and to the question highlighted by my hon. Friend the Member for Taunton Deane (Rebecca Pow). We will reach this ambition—the 2° is operational; the 1.5° is the aspiration—only through our plans to link with other countries in an international low-carbon energy innovation taskforce called Mission Innovation. That goes back to the leadership to which the hon. Member for Ogmore (Huw Irranca-Davies) referred, and we believe that we can achieve that.
The last Labour Government left behind in 2010 an energy security black hole: no nuclear power plants built; a legacy of under-investment; and low carbon targets and no plan to meet them. The advice of the hon. Member for Wigan (Lisa Nandy) never considers the consumer. In her endless recommendations to increase subsidies, it is unknown what the Opposition actually have in their plan. It is clear to Conservative Members that a responsible national energy policy demands a willingness to take decisions today for the good of tomorrow. It is this Government who will not take any risks with our energy security, and that is why we agree with the position set out clearly by my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) that shale would provide a low-carbon bridge. We will get on with the job of building a system of new energy infrastructure fit for the 21st century.
Question put.
Housing
(8 years, 4 months ago)
Commons ChamberRead Full debate Read Hansard Text
18:58 - The House divided: - Ayes: 205 / Noes: 297 - Question accordingly negatived.
John Healey (Wentworth and Dearne) (Lab)
I beg to move,
That this House notes that the Government’s record on housing is one of five years of failure with rising homelessness, falling home-ownership, escalating rents, deep cuts in investment and the lowest level of house-building since the 1920s; further notes that the Spending Review and Autumn Statement will not result in the homes that young people and families on ordinary incomes need being built because it cuts the level of investment from that of 2010 and fails to prioritise genuinely affordable homes to rent and buy; notes Shelter Scotland's report of September 2015, Affordable Housing Need in Scotland, which states that overall house-building levels are well below their peak in 2007 and that the number of new social homes built has fallen by 44 per cent from 2010 to 2014; notes the widespread concern that the Government’s Housing and Planning Bill will lead to the severe loss of affordable homes, will be a let-down for aspiring home-owners, and will do nothing to help England’s private renters struggling with poor conditions and high renting costs; and calls on the Government to help families who are struggling with the cost of housing, including by building more affordable homes to rent and buy.
Above schools, wages, crime, foreign affairs and terrorism, people now place housing as their most pressing concern. It is fourth in Ipsos MORI’s latest long-running “Issues Facing Britain” survey. In all parts of this House, we know of the increasing pressure, frustration and sometimes despair that our constituents feel when a decent, affordable home to rent or buy is totally beyond them.
That is why we have called today’s debate on the Government’s record on housing. It is a truly shameful record, with five years of failure on every front. For the Housing Minister, who I know is a fan of social media, we could call it #fiveyearsoffailure. There have been five years of failure on homelessness—[Interruption.]—which, despite the laughter of Conservative Members, we all feel keenly at Christmas. Rough sleeping has increased by more than half in the past five years, while statutory homelessness is up by more than a third and is rising rapidly.
There have been five years of failure on home ownership. The rate of home ownership has fallen each and every year since 2010, and the total number of home-owning households in this country is now more than 200,000 fewer than when the Tories took control. It is young people who are being hit the hardest, with the number of homeowners under the age of 35 down by a fifth in the past five years.
There have been five years of failure on private rents. While incomes have stagnated, private rents on new lets have soared—up by £1,400 a year—since 2010.
There have been five years of failure on housing benefit costs, which rose by £4.3 billion in the last Parliament, despite punishing cuts such as the bedroom tax, even as housing investment was slashed.
Finally, there have been five years of failure on house building. The House of Commons Library has confirmed to me that the previous Government built fewer new homes than any peacetime Government since David Lloyd George’s in the 1920s.
Chris Philp (Croydon South) (Con)
Speaking of house building, is not the most important statistic that, in the last year of the last Labour Government, on the right hon. Gentleman’s watch, there were 124,000 housing starts across the UK, whereas last year that figure had gone up to 165,000, which is a very impressive record? If he is so concerned about the topic, why did he not—
Mr Deputy Speaker (Mr Lindsay Hoyle)
Order. I think you intend to speak, don’t you?
Mr Deputy Speaker
In which case, it should be a very short intervention. I do not think we need to hear any more, because I want to get you on the list.
John Healey
The statistic that matters most is the number of homes that were actually built. The hon. Gentleman is right to say that 2009 saw the lowest level of house building under 13 years of Labour, but that figure was still higher than that in the best year in the past five years of a Tory Government.
There have been five years of failure on every front, by every measure and in every area. Two weeks ago, the Prime Minister gave a speech in which housing was a central theme. He said—I am not making this up—that
“this is a government that delivers”.
Well, it does not deliver on housing. The Government spent the last five years blaming Labour, but they have their own track record now—and it is one of five years of failure on housing under Conservative Ministers.
The Chancellor gave his autumn statement and spending review three weeks ago and, again, housing was a central theme.
John Healey
That is exactly what the Chancellor said:
“We’re doubling the money for housing to build 400,000 new affordable homes”.
After the Chancellor’s autumn statement, the Government’s annual investment in housing will be £1.7 billion. Under the money inherited in 2010 from Labour, it was £3.1 billion. That is not an increase, but a cut—it is not a doubling, but a halving—of vital investment in housing in our country for our people.
Robert Neill (Bromley and Chislehurst) (Con)
The right hon. Gentleman was a long-serving Minister. Will he reflect on the fact that, on his Government’s watch, the number of households on the housing waiting list went up from 1 million to 1.8 million and that there were 420,000 fewer social homes to rent at the end of his term in office than before? Is that not 13 years of failure?
John Healey
The hon. Gentleman might like to reflect on the fact that, under 13 years of Labour, more than 2 million new homes were built in this country and the number of homeowners rose by more than 1 million, but in the five years under his Government that figure has fallen by more than 200,000. So much for the party of the so-called homeowners.
Mr Jim Cunningham (Coventry South) (Lab)
We should remind the Government that it was the Conservatives, when they were last in power, who stopped local authorities building social housing. As a result, rents have gone through the roof and young people cannot get a house today.
John Healey
My hon. Friend is right. He probably shares my view of our own Labour record. We are deeply proud of the billions of investment we made to make homes decent again, but we were perhaps too slow to start building new homes. When I was the Minister for Housing in the final year of the previous Labour Government, we got under way the largest council house building programme we had had for more than two decades. For the first time, councils were able to get the support on the same terms as housing associations to build the new affordable homes that were so badly needed in this country.
I want to return to the Chancellor’s boast about doubling the money for housing for 400,000 new affordable homes. It was not a doubling, but a halving of the investment under Labour. Most of those 400,000 homes had been announced before, so there is also double counting. Finally, many of the new homes will not be affordable for those on ordinary incomes either to rent or to buy. I would say to the Minister that we perhaps need a new hashtag. How about #fivemoreyearsoffailure?
Andrew Gwynne (Denton and Reddish) (Lab)
My right hon. Friend makes an important point about just how affordable the new affordable homes are likely to be. The data I have seen show that, in areas such as Stockport, somebody would need an average income of about £53,000 just to have a deposit for one of the new starter homes.
John Healey
My hon. Friend is right. I will come on to starter homes and how Tory Ministers try to fiddle the figures by fiddling the definition, but this is not the first time they have redefined what constitutes “affordable”. The level of so-called affordable rented homes we are now seeing in many parts of London means that rents are more than £1,000 each month. That may be affordable in their book, but for many people—with ordinary jobs, on ordinary incomes—it is totally beyond their reach. More is required of this Government to help the people who are working hard and struggling most.
Mr Stewart Jackson (Peterborough) (Con)
The right hon. Gentleman is being generous in giving way. He did not attend the Housing and Planning Public Bill Committee, for the reasons he has given us, but will he confirm that it was comprehensively demonstrated by all the witnesses during the evidence sessions that there was no evidence that starter homes would be unaffordable for anyone north of a line between the Bristol channel and the Wash—most of the north-west, the north-east, Yorkshire and Humberside, and the east and west midlands?
John Healey
I am not sure how much attention the hon. Gentleman was paying. He should have looked at the reports from Savills and from Shelter, and he should have listened to my hon. Friends who led for Labour so ably and so strongly throughout the many scrutiny sessions in Committee. I want to the return to the fact that we have seen such a serious failure during the past five years under Conservative Governments.
Mr Gareth Thomas (Harrow West) (Lab/Co-op)
Does my right hon. Friend not think that the forced sale of council homes will exacerbate the homelessness crisis? Will he encourage the hon. Member for Uxbridge and South Ruislip (Boris Johnson) to speak in this debate to set out his view of the potential for extending Help to Buy to pay for the voluntary right to buy for housing associations?
John Healey
My hon. Friend led in making those very arguments in Committee, and I hope we will get a chance to make those arguments again when the Bill returns to the House straight after the Christmas recess. He asked for my view about whether the forced sale of council homes, particularly in London, is likely to lead to a rise in homelessness. I agree with him that it will. In some ways, however, it is much more significant that the Conservative-led Local Government Association agrees, which is clearly why it opposes the plan. It has warned of the consequences,
“in particular on council waiting lists, homelessness and housing benefit.”
In many ways, these are not simply abstract political arguments or dry statistics, but the lives of our friends, our neighbours and our constituents: the young couple on average income who want to start a family, but are now less, not more, likely to be able to get a home of their own; the family, renting privately, whose kids—like 1.4 million others in the same situation—are less, not more, likely to go through school without being forced out by their landlords and forced to move areas; and the pensioner needing affordable supported accommodation who is now less, not more, likely to find a suitable home and the help they need. These are the human stories of this housing crisis, which has worsened during the past five years.
Steve McCabe (Birmingham, Selly Oak) (Lab)
Do we not need a bit of contrition, rather than laughter and synthetic anger, from Government Members? Is it not a fact that homelessness and rough sleeping have risen 55% since the Prime Minister took office, even though he said they were a public disgrace?
John Healey
My hon. Friend is right. He will remember how serious the levels of homelessness and rough sleeping were when Labour came to office in 1997 and how they fell with the policies that we put in place over 13 years. He is right to say that he, like Members on both sides of the House, has seen homelessness and rough sleeping rising again. We should pause ahead of the Christmas period, reflect on that and ask hard questions of the Housing Minister about why it is happening, what he will do about it and, in particular, what he will do over the Christmas period to help.
Jake Berry (Rossendale and Darwen) (Con)
The right hon. Gentleman will be aware that homelessness peaked in 2004. He makes the serious point that we should all consider homelessness at Christmas. That peak came under a Labour Government, but I am not making a political point. As he has worked on this issue and will have been involved in part of the solution, perhaps he can tell the House what he believes the solution is.
John Healey
I was, indeed, involved in part of the solution. I have to tell the hon. Gentleman that part of the solution is not the deep cuts in local council budgets that we will hear the detail of later this week. Part of the solution is not cutting the rents for supported housing, because that will lead to a cut in the provision for many of the most vulnerable people in this country.
Unfortunately, we are still close to the start of a five-year Parliament. This is the most crucial part of the political cycle, when policy direction is set. It should be a time for stock-taking and fresh thinking, but the Budget, the autumn statement and the Housing and Planning Bill do nothing to correct the causes of the five years of failure and, in many areas, will make problems much worse.
Alberto Costa (South Leicestershire) (Con)
The right hon. Gentleman is raising very serious matters. If his facts are correct, why did the property website Zoopla state just before the general election earlier this year:
“A win for the Labour party in the General Election could spell trouble for first-time buyers”?
Why would Zoopla have said that?
John Healey
Search me, guv. Ask Zoopla. I have to tell the hon. Gentleman—[Interruption.] I’m not sure I’ll bother, Mr Deputy Speaker. He is not listening anyway.
Mr Deputy Speaker (Mr Lindsay Hoyle)
Order. That is a very good point. I am struggling to hear the shadow Minister express his views on housing. Can we please be a bit more tolerant and have less shouting?
Rob Marris
Does my right hon. Friend agree that it is time that the Conservatives took some responsibility for their failure in government? Their housing policy has been based on a misunderstanding of capitalism. It has all been focused on helping people to buy one of the insufficient number of houses, rather than on increasing the supply.
Mr Deputy Speaker
May I also say that a lot of Members want to speak? If we are going to have interventions, let us make them short.
John Healey
My hon. Friend makes a really important point that I hope will be a point of debate this afternoon. A serious question that must be asked in respect of the plans before us is whether it is the right use of public money to subsidise the demand for new housing, at a time when the housing market in many parts of the country is already out of control.
John Healey
No, I will make some progress. If the hon. Lady really wants to intervene later, I will give way.
At this point in the political cycle, we need to look at what is ahead. Two areas demonstrate the direction that the Tory Government are taking on housing and serve as a warning of what is to come. The first is a systematic attack on housing opportunity for young people and families on ordinary incomes, the very people the housing market is failing most at the moment. Ministers have launched a full-frontal assault on council and housing association homes which will hit those on low and middle incomes hardest. The Office for Budget Responsibility has said that the result of both the Budget and the autumn statement together will be 34,000 fewer housing association homes built. Meanwhile, the Housing and Planning Bill strangles the ability and obligation of both private and public sectors to build the affordable homes to rent and to buy that are badly needed in both urban and rural areas alike.
In addition there is an extraordinary forced sell-off of council homes to fund an extension of the right to buy, with no prospect or commitment, as Labour has urged, of like-for-like, one-for-one replacements in the local area. I have to say that in many areas of the country, both rural and urban but especially in London, these council homes will go not to families struggling to buy, but to speculators, second homeowners, and buy-to-let landlords—and of course the greater the demand for affordable housing in an area, the higher the value of the houses, and the more the Chancellor will take in his annual levy.
Maria Caulfield (Lewes) (Con)
Does the shadow Minister not agree that council house building is actually at a record 23-year high and that more council housing has been built in the last five years than under the 13 years of the last Labour Government?
John Healey
The hon. Lady raises an interesting point. If she looks at the Homes and Communities Agency data, they will confirm—as my hon. Friend the Member for Sheffield South East (Mr Betts), a member of the Select Committee, said at DCLG questions yesterday—that more than eight in 10 of the social homes and council homes built under the hon. Lady’s Government over the last five years were started and funded under the Labour programme.
Helen Goodman (Bishop Auckland) (Lab)
Before my right hon. Friend moves on from the point about speculation, is he aware that the largest amount of foreign money coming into the London property market is from Russia and the average price Russians pay is £6.3 million?
John Healey
That detail had escaped me, but I am very grateful to my hon. Friend for mentioning it.
Graham Jones (Hyndburn) (Lab)
I think my right hon. Friend will agree with me that it is time to kill this myth that the Tories are the people’s friend and that they build council houses. The reality is that those council houses were left in a right mess by the previous Tory Government and the last Labour Government had to put a large amount of money into refurbishing them. It was a disgraceful legacy.
John Healey
My hon. Friend is right. The last Labour Government invested £22 billion to bring homes that were barely decent up to scratch—some 1.4 million council homes were given new kitchens, central heating, doors that fitted, double-glazing. Those homes were, for the first time, fit to live in, but they had been left as a legacy from the previous Tory Government. My fear for the future is that when Labour gets back into government, we will be faced with a similar legacy of neglect of our council housing.
Over the next five years, we look ahead to a huge loss of affordable homes to rent and to buy in this country. In total, the Chartered Institute of Housing expects the loss of 195,000 affordable homes for social rent over the next five years.
On top of this, in the very last sitting of the Housing and Planning Bill Committee, Ministers introduced plans to scrap the secure tenancies that Margaret Thatcher herself brought in for council tenants, restricting them instead to fixed-term tenancies of between two and five years. So the message from this Government could not be clearer: “If you’re on a low or middle income and rent a council home, then a stable family home is too good for the likes of you.”
Wes Streeting (Ilford North) (Lab)
Thanks to years of Tory leadership in Redbridge, we have the lowest amount of social housing stock in London. Does my right hon. Friend also know that one in 27 households in the private rented sector is at risk of eviction because of a whole load of factors, the majority of which are due to the Government’s policies?
John Healey
I do indeed, and I say to the Minister, because there is still time for him to think again, that the Housing and Planning Bill is a huge missed opportunity to help 11 million people who live in the private rented sector without the security to start their lives and bring up their families. He could legislate for longer tenancies, better consumer rights, and better and more decent standards and obligations on landlords. He has refused to do that so far. I hope that he will think again.
Boris Johnson (Uxbridge and South Ruislip) (Con)
I ask the right hon. Gentleman to clear up one point upon which I—and, I am sure, many people—am still in doubt. Is he in favour of giving housing association tenants the right to buy their home? Is he in favour of aspiration for those people to buy homes, in the way that Opposition Members have done? Yes or no?
John Healey
I am certainly in favour of aspiration and of home ownership. Under the last Labour Government, the number of homeowners increased by more than 1 million. However, I confirmed on Second Reading that we will oppose right to buy funded by forced sale of council homes because it will lead to a huge loss of affordable homes to rent and buy that people in this country need. That policy will penalise people on ordinary, modest incomes.
Mr Clive Betts (Sheffield South East) (Lab)
Is my right hon. Friend not amazed that, despite the Government’s claim that their policy of selling off high value council homes will fund the replacement of housing association properties and council homes, as well as a contribution towards the remediation of brownfield sites, they still cannot table for hon. Members the figures to justify that?
John Healey
My hon. Friend is right. Obviously, the Select Committee is examining those matters. It is not the first time that the sums do not add up, but if the Government are going to force the sale of council assets to fund the programme to extend the right to buy to housing associations, why do they not start with some of their own assets? Why do they not start by funding their policy with Government support, instead of taking it, like some medieval baron, from councils because their coffers are empty?
Ministers made much of starter homes and there is clearly a need for more affordable homes to buy, especially given that the number has fallen in the past five years by nearly 30%. However, the Government’s starter homes will be a non-starter for families on ordinary incomes. Shelter calculates that, across the country, one would need an annual income of around £50,000 and a deposit of £40,000 to afford a starter home. In London, one would need an income of £77,000 and a deposit of £98,000. That is simply out of reach for most of those on middle incomes—working families, who need help to buy the most. Of course, there are no controls to stop those who can afford to buy without help from the Government taking advantage of the scheme. There is a big risk that those who need it least will benefit most.
Julian Knight (Solihull) (Con)
The right hon. Gentleman is being most generous in giving way. If right to buy is, as he suggests, such a disaster for housing associations, why have they entered into a voluntary arrangement with the Government to deliver it? Will the right hon. Gentleman explain that?
John Healey
Has the hon. Gentleman ever heard the term, “shotgun arrangement”? If he talks to a lot of housing association chief executives, their boards or their tenants, as I have done, he will find that they feel that they are left with no choice. They do not like it, they do not believe it, they do not trust Ministers, but they signed up to it because it is the least worst option for them.
With so many people’s dreams of buying their own home out of reach, Ministers have responded by announcing plans to fiddle the figures again, by changing the definition of affordable homes to include so-called starter homes for sale at up to £450,000. That is an insult to young people and families on ordinary incomes, and a mockery of common sense and sound policy. It is like the Health Minister tackling the GP shortage by reclassifying cashiers at Boots pharmacy as qualified doctors.
The second area that demonstrates the direction that the Government are taking in this Parliament is the systematic side-lining of local people and local decision making. Whatever they say, Ministers’ actions are anti-localist. At every turn since the election, housing policy has been set to undermine the say of local people and override their local representatives. The Housing and Planning Bill puts 33 new centralising powers in the hands of the Secretary of State, from directing starter homes to be built instead of affordable homes, to fixing rents for so-called high-income tenants.
Those powers include a legalised annual cash grab from councils, which totally undermines their ability to plan for housing need in their area. The Bill also rips up the contract of localising local finance for housing, which until this point has been the subject of all-party support. Ministers will have sweeping new powers to award “automatic planning permission”—the so-called “permission in principle”. That is not, as the House has been led to believe, simply a policy for dealing with brownfield sites; it is a power and policy for any site allocated for use in a local plan. There will be no need to apply for full planning permission, no limitations on what sort of development can be built, and no planning gain or obligation on developers. Only the technical details will be left for the elected local planning authorities to deal with.
A host of organisations now echo Labour’s concerns about such open-ended powers, including the Campaign to Protect Rural England, Friends of the Earth and the Woodland Trust. There will be deep concern in all parts of the House if the Government’s dramatic failure on housing leads to such drastic steps and denies local communities a voice on development in their areas.
Robert Neill
I am following what the right hon. Gentleman is saying, but would his argument have rather more weight if he had not been part of a Government who imposed regional spatial strategies that gave no choice to local communities on how housing was imposed? Is he contradicting his own policy in government?
John Healey
The hon. Gentleman is a master of distraction. I am making a point about clause 1 of the Bill, and he has enough experience to know what is at stake. If he reads the Bill, I know he will be worried about the sweeping, open-ended powers that it contains. If the Minister wants those powers, he should justify that in this House and the other place during the passage of the Bill, or tighten them up so that they do what he says he wants them to do. I look forward to the Minister’s response on that point, but I am not holding my breath.
In the housing world the Minister has become known as “Mr Million Homes”. He said:
“By the end of this Parliament success would mean that we have seen a build in total of something like a million homes”.
In other words, an average of 200,000 homes a year. Now we know that the Minister is prone to a bit of bullish bluster, but that is going some. In his first year as Housing Minister, not 200,000, but 115,590 homes were built. Last year—the best year out of the previous Government’s five years—only 117,720 homes were built. The total number of homes built in that Government’s best year was still lower than in the worst year of the Labour Government’s 13 years, which was in the depths of the global banking crisis and recession. Even the Prime Minister has not gone as far as the Minister.
In conclusion, no Government can sit back and see a whole generation priced out of a decent home, and call themselves a “one nation” Government. No political party can say nothing in their manifesto to the 11 million people living in private rented accommodation, and call itself a “party of aspiration”. No party can have a programme that will lead to a huge loss of genuinely affordable housing, and call itself the “party of working people”. This country has seen five years of failure on housing under Conservative Ministers. People desperately need and deserve better, and during this Parliament, this party—the Labour party—will prove itself to be the party of working people, of aspiration, and of one nation.
The Minister for Housing and Planning (Brandon Lewis)
I warmly thank Her Majesty’s Opposition for choosing the subject of today’s debate. It is an important subject, and I am always eager to compare and contrast our records on housing. It is now five months since the previous such debate, and much has changed. In that time, we have announced the largest Government house building programme for 40 years. And of course, we now have a new shadow Housing Minister, the right hon. Member for Wentworth and Dearne (John Healey). He was briefly Minister for Housing at the end of the last Labour Government, so this is rather a “Back to the Future” experience. I think I am now on my third shadow Housing Minister.
If we continue with that “Back to the Future” analogy, I recall that it is the third part of the trilogy—the one about cowboys—that nobody really likes very much. The question is: which “Back to the Future” film are we dealing with here? I hope it is not the cowboy one, but I also hope it is not the Soviet version from 1973. I should warn any hon. Members who do not have this kind of film library at home that that is a terrifying tale, in which Ivan the Terrible is accidentally transported into the future to become the superintendent of an apartment building in Moscow. Who knows? Stranger things are happening in the Labour party.
Shadow Ministers might come and go, but one thing remains the same: the curious phenomenon of Labour Members claiming that their record is preferable to ours. The right hon. Gentleman condemns our plans to support the aspirations of home buyers but, in a speech lasting more than 32 minutes, he did not suggest any alternatives. He talks about a housing crisis yet fails to admit who created it. And he claims that he will take Labour’s record over ours without any rational justification for his preference.
Mrs Main
Has my hon. Friend given any thought to the fact that when Labour estimated in 2003-04 that only 5,000 to 13,000 Polish migrants would come in, more than 100,000 actually did so? Where did the Labour Government think those people were going to live? Does my hon. Friend think that might be part of the issue?
Brandon Lewis
The right hon. Member for Wentworth and Dearne has put on record his views on home ownership and house building, certainly going back to 2005. Obviously, we have challenges going right across as our population grows.
Let me remind the House of the situation we inherited in 2010. Perhaps some of my hon. Friends who were not here before then will be interested to know about this. We inherited: a housing bubble that burst with devastating consequences; an industry in debt; sites mothballed; workers laid off; skills lost; a loss of 420,000 affordable homes; rocketing waiting lists; and collapsing right-to-buy sales. In their 13 years in office, the Labour Government built only one home for every 170 that were sold. There was a sustained fall in home ownership. To be fair, the right hon. Gentleman knows that very well, because he himself said,
“I’m not sure that’s such a bad thing”.
It was no coincidence that that disregard for aspiring home owners was matched by chaos in the regulation of lending, a planning system in disarray controlled from the centre, a post-war low in house building by councils and the lowest level of house building since the 1920s.
Mr Jackson
Is my hon. Friend as disappointed as I am that in the course of the 32-minute churlish whinge-athon by the Opposition spokesman, he could not even give this Government credit for using the Housing and Planning Bill to tackle slum landlords? The Labour Government did nothing about that in 13 years.
Brandon Lewis
Perhaps the right hon. Member for Wentworth and Dearne has not been involved in the Bill’s progress in Committee, as I know my hon. Friend the Member for Peterborough (Mr Jackson) has been. That might be why, despite what is in the Opposition motion, he has oddly not picked up on the fact that we are going further to crack down on and drive out rogue landlords than any Government have done before. The previous Labour Government oversaw the lowest level of house building since the 1920s, with just 88,000 starts being overseen by the right hon. Members for Don Valley (Caroline Flint) and for Derby South (Margaret Beckett) and, of course, the right hon. Member for Wentworth and Dearne. That was their housing crisis, that was their record, and that is the state of affairs that the right hon. Member for Wentworth and Dearne claims the public should prefer.
Dawn Butler (Brent Central) (Lab)
Does the Minister feel that those people who voted Tory at the last election will be surprised by this Housing and Planning Bill?
Brandon Lewis
As it contains two of our key manifesto pledges, on which we are mandated to deliver, I suspect that people will be pleased to see that we are a Government who are getting on and delivering for the people of this country. To take the hon. Lady’s very direct question, the public gave their verdict on the performance of the last Government at two general elections. At the last time of asking, the electorate were offered by the Opposition party a reprise of Labour’s centrally controlled, top-down housing nightmare—land grabs, the mansion tax, rent controls, red tape and restrictions on right to buy.
Victoria Borwick (Kensington) (Con)
Is the Minister pleased to see how many people have already expressed their interest in our aspirational policy and are already queuing up to take advantage of it?
Brandon Lewis
My hon. Friend makes a good point. The right hon. Member for Wentworth and Dearne does not seem to want to give housing association tenants the opportunity to buy their home, even though some 11,000 people have already expressed their interest in doing just that.
The public did consider the cocktail of regressive options being put forward by the main Opposition party, and they politely declined to take it up.
Wes Streeting
Actually, people in Redbridge were tired of the Conservatives running the council, which is why they elected a Labour council in May 2014. One of our pledges—I am still an unpaid councillor in Redbridge —was to introduce a landlord licensing scheme. When can we expect to hear from the Minister’s Department the go-ahead to deliver the manifesto pledge that so many residents are crying out for?
Brandon Lewis
Obviously, we took through selective licensing just before the general election. That cracked down on rogue landlords, which are mentioned in the Bill. I will be coming back to that matter as we make progress with the Bill. I am sure that the hon. Gentleman’s residents will be delighted to see that we are going further than any Labour Government ever did. Under our watch, the number of first-time buyers doubled, the number of new homes doubled and public support for new house building doubled.
Brandon Lewis
I am sure that the hon. Gentleman is rising to congratulate us on our success.
Steve McCabe
Well, actually I do want to congratulate the Minister on his measures to tackle rogue landlords. It is a step forward. Does he think it would be a good idea also to tackle rogue developers, so that we do not have an explosion of rogue landlords?
Brandon Lewis
I am sure that the hon. Gentleman will want to explain what he means by rogue developers. Certainly, I want to ensure that good quality developers are building the houses that we need across the country for the people who need them.
Helen Goodman
I thank the Minister for giving way. May I suggest that he speaks to Mr Toon, the economic director of the National Crime Agency, who says that,
“the London property market has been skewed by laundered money.”
He said that prices are being artificially driven up through the use of the proceeds of crime. If he wants to do something, he should just pick up the phone.
Brandon Lewis
Obviously, I would be happy to support anybody who is looking to crack down on crime in London. Equally, I know that the hon. Lady seems to think that affordable houses in London start at £6 million. That may be so for those on the Labour Benches, but not for those of us on the Government Benches.
Graham Jones
I thank the Minister for giving way. In this long list of successes, will he include that wonderful policy, the green deal?
Brandon Lewis
One day, the hon. Gentleman or one of his colleagues will intervene to explain the wonders of eco-towns and just how many got built under the Labour Government.
Robert Neill
Perhaps I could bring my hon. Friend back to the London housing market. Does he agree that one of the worst things that could happen to the London housing market is the imposition of rent controls on the private sector, as it invariably drives up costs, reduces supply and encourages the bad landlord rather than the good one whom we need to see in the capital?
Brandon Lewis
My hon. Friend makes a good point. One lesson we have learned from around the world, in places such as New York, is that rent controls simply drive down supply. They drive a black market and send rents upwards. Certainly, it is not something that we will be seeing under this Government.
Brandon Lewis
I will make a little more progress, and then I will take some more interventions.
Since 2010, we have helped more than 270,000 households buy a home through Government schemes. We have provided more than 270,000 affordable homes to rent, which went beyond our target, nearly one third of which were in London. We are the first Government since the 1980s to finish a term of office with a higher stock of affordable homes than we started with.
I gently remind the right hon. Member for Wentworth and Dearne, who has set out his preference for council house building, that twice as many council homes were built in the past five years of our Government than were built during 13 years of the Labour Government. More new council housing was started in London last year than during the whole of the Labour Government, shocking as that may seem. In all, £20 billion was invested over the course of the last Parliament, achieving the same rate of affordable house building with half the rate of grant as under the Labour Government.
In many ways, that is a clear metaphor for our record on housing: building more for less and doing it faster. We were not afraid of difficult decisions and of doing things differently. That has continued. The right hon. Gentleman mentioned our decision to end lifetime tenancies for new tenants to ensure that we make the best use of social housing based on need and income.
Clive Efford (Eltham) (Lab)
When the Minister introduced that amendment to the Housing and Planning Bill, he referred to 380 households that occupy social housing with two or more spare bedrooms, and cited that as a reason for wanting to manage the stock more efficiently and to move people around social housing. Given that the Government are concerned about under-occupation, is it their policy not to allow people who under-occupy properties the right to buy?
Brandon Lewis
On lifetime tenancies, it is only right that tenancies are reviewed after several years to identify whether the circumstances of tenants have changed. Through the voluntary extension of right to buy—it will be for housing associations to decide—we want to extend that opportunity to all 1.3 million people.
Brandon Lewis
I will give way in just a moment.
Of course, that move was opposed by the Labour party, which prefers renters to remain renters—
Mr Deputy Speaker (Mr Lindsay Hoyle)
Order. Mr Efford, you have to sit back down. The Minister has given way once and he will give way again, but you can’t just stand there—[Interruption.] I am sorry, but you just can’t hang around stood up.
Clive Efford
On a point of order, Mr Deputy Speaker. I am sorry, but the reason I tried to intervene again is that the Minister, discourteously, completely ignored the point I made, presumably because it was too awkward for him.
Mr Deputy Speaker
Order. I will make the decisions. That is not a point of order. I hope you are not trying to reflect on the Chair. [Interruption.] In which case, you don’t need to be stood up waiting for the Minister to give way again. I am sure the Minister will wish to give way on his terms, and not on your terms or mine.
Brandon Lewis
Thank you, Mr Deputy Speaker. As it happens, I have outlined our intention to extend right to buy to all social housing tenants. I am delighted that housing associations are playing their part.
Jake Berry
Will my hon. Friend update the House and say whether he has had any representations from the housing sector or from the Labour party on reintroducing lifetime tenure for those in social housing? If that happened, what will be the effect on the market?
Brandon Lewis
My hon. Friend makes a good point—that silence has been very stark.
Our plans for housing are delivering but I will be absolutely up front about this: it is clear that we must do more to meet the housing needs of our nation. If our task during the last Parliament was to rescue the housing market, now we must supercharge it.
Jo Cox (Batley and Spen) (Lab)
Does the Minister accept the Office for Budget Responsibility estimate that, as a result of the July Budget and the November spending review, the Government will build 34,000 fewer homes by 2020 than previously forecast?
Brandon Lewis
I will come to housing associations in a few moments but, as I told the Communities and Local Government Committee this morning, housing associations have an exciting opportunity. I would argue that they will be able to access and realise assets to build more homes than ever before.
Brandon Lewis
I was going to make progress but I will give way to the Chairman of the Select Committee.
Mr Betts
I thank the Minister for giving way. To go back to supercharging, some of us were pleased when the Government made a commitment to build 1 million new homes in this Parliament. Is that still Government policy and a commitment, or has it been downgraded to an aspiration?
Brandon Lewis
To be fair to the right hon. Member for Wentworth and Dearne, he quoted me spot on in his opening remarks. It is absolutely still our ambition to build 1 million homes. We need to be ambitious about building new homes, but this is not solely about the number of new homes. We are determined not just to halt but to reverse the slide in home ownership that the Labour party oversaw. With so many people being kept off the housing ladder for so long, we are determined to deliver on our promises quickly.
James Cartlidge (South Suffolk) (Con)
On the measures to increase home ownership, which contrast with the inaction from the Labour party, is not one of the most radical measures we have introduced to support first-time buyers the levelling of the playing field between them and the people who wish to buy property to rent out to those same frustrated first-time buyers?
Brandon Lewis
My hon. Friend makes a very good point—one he has raised a number of times in the House. I am pleased we are able to move forward and deliver on something that will, as he rightly says, level the playing field.
Brandon Lewis
I will make a bit more progress and then I will take more interventions.
For the reasons that I have given, in the spending review we announced the biggest investment in housing for 40 years. We are determined to invest in what matters most to young people and to British families. We want to pay off Labour’s debt and make sure we build the homes our country needs. Both are required to make this the turnaround decade.
In the spending review, the Chancellor said, “We choose housing” and delivered a further £20 billion. Our work will include: major investments in large-scale projects, such as Ebbsfleet garden city, Bicester, Barking riverside and Northstowe; £7.5 billion to extend the Help to Buy equity loan scheme until 2021; and supporting the purchase of 145,000 new build homes. In London, we are doubling the value of equity loans to 40%, providing the capital’s aspiring home owners with a better chance to buy. A new Help to Buy ISA is helping buyers across the country to save for a deposit.
The brand new Help to Buy shared ownership will deliver a further 135,000 homes by removing many of the restrictions that have held back shared ownership. For example, an aspiring home owner in Yorkshire can get on the housing ladder with a deposit of just £1,400. I am sure the right hon. Member for Wentworth and Dearne (John Healey) will be encouraging his constituents to apply. Let me provide the House with some clear examples of why this matters. In the south-east, a deposit could be as low as £2,400, and in London £3,400. Our plans for shared ownership will make 175,000 more people eligible for home ownership. Just last week, the Prime Minister visited a family in Burton and I visited one in Didcot. They were excited for the future and the possibilities home ownership opens up to them. These possibilities will be open to anyone of any occupation as long as they earn under £80,000, or £90,000 in London.
We will provide other opportunities for working people, too: a £1 billion housing delivery fund to support small and custom builders; £8 billion to build 450,000 affordable homes; 100,000 homes for affordable rent; and, yes, 200,000 affordable homes will be starter homes available to young first-time buyers, with a 20% discount. That is the largest affordable housebuilding programme for many decades. Starter homes will be transformational.
Opposition Members may laugh and pour scorn on starter homes, and go against the aspirations of first-time buyers, but I ask Members across the House just to pause and think for a moment. A first-time buyer getting a 20% discount on a new home, linking that with a 5% deposit thanks to Help to Buy, saves thousands. For example, a two-bedroom home in Durham—in the constituency of the hon. Member for City of Durham (Dr Blackman-Woods)—can be bought for just under £150,000. With 20% off, that will be £120,000. If used with Help to Buy, it means a first-time buyer can get a house with a mortgage of £90,000 and a deposit of only £6,000.
Andy Slaughter (Hammersmith) (Lab)
The average price of a property, according to the Metro today, is now over £1 million in my constituency. To get a starter home, if one could possibly be found for £450,000, an income of over £101,000 is needed. Is that what the Minister has in mind as affordable housing? Pathetic!
Brandon Lewis
That was almost a reasonable attempt by the hon. Gentleman, but let me just give him some facts for London. The average first-time buyer home is less than the cost of an average home generally. For example, in London an average first-time buyer home is £364,000. We recognise that that is a challenge, but with a 20% discount it will cost £291,000. If used with the Help to Buy scheme, a first-time buyer can buy that home for £174,000 with a deposit of just £14,500. I also point the hon. Gentleman to my comments of a few moments ago: shared ownership, even in London, means getting on the home ownership ladder for just under £3,500. We make no apology for our focus on affordable homeownership.
Boris Johnson
I congratulate my hon. Friend on his remarks, and here is one more statistic: the massive expansion in “part buy, part rent” schemes, which he is helping us to oversee in London, has already helped 52,000 families, on an average household income of £37,000, into homes they partially own and will own more of in the future. That is the Conservative policy.
Brandon Lewis
My hon. Friend highlights the reality and what the ambition should be. London is a shining example of what a city can achieve under the leadership of a powerful Mayor. He has overseen the delivery of more than 67,000 affordable homes since the mess we inherited in 2010, and we want to build on that, which is why we are looking to devolve more powers to mayoral London and enable my hon. Friend the Member for Richmond Park (Zac Goldsmith) to take forward my hon. Friend’s work. We make no apology for focusing on affordable home ownership, while Labour does everything it can to deny people the chance to own their own home. It is what people want; buying a home is an aspiration shared by the vast majority of the public—86% say they would choose to buy their own property—which might partly explain the result at the general election, when Labour was ignored by the public.
Robert Neill (Bromley and Chislehurst) (Con)
The Minister is right to emphasise the importance of delivering on aspiration, but is he not also right to contrast the delivery by my hon. Friend the Member for Uxbridge and South Ruislip (Boris Johnson) with the complete failure of the top-down dirigiste policies of the former Mayor of London, who I gather now advises the leader of the Labour party?
Brandon Lewis
My hon. Friend puts it succinctly and highlights the mess inherited nationally and in London. I hope we can build on our work delivering for our country, following the general election result, by ensuring good governance in London with another Conservative Mayor next year.
Mr Andrew Smith
The Minister talks about aspiration, but what about the aspiration of people on low incomes in my constituency for whom the sorts of figures he is talking about are completely out of reach and who are being shunted out of Oxford because the housing allowance will not cover rents in the private rented sector? What about their aspirations and chances of a decent life?
Brandon Lewis
And there was I thinking the right hon. Gentleman was going to congratulate my hon. Friend the Mayor of London on his excellent work. It is important that he considers the whole ambit of the Housing and Planning Bill and our policies elsewhere, which are providing a wide offer across all tenures and types of housing and, with those £1,400 deposits to help people into those homes, making sure that, in areas such as his, shared ownership is a real possibility.
For too many people, the aspiration and the reality of home ownership are drifting apart. The decline in home ownership is not just an economic problem but a social failure. We risk creating a generation of young people exiled from home ownership. The right hon. Member for Wentworth and Dearne might not consider the decline in home ownership since 2005 to be such a bad thing, but we disagree. He might not care, but we do. We care about young people worse off than their parents, compelled to leave the communities they love and grew up in or to decline good job opportunities because local housing is too expensive. That is why we must build more homes. Everyone in the House has a duty to make that case and, along with local authorities, to show good leadership. We have a duty not just to say that we need to build more homes somewhere else, but to build—and to make the case for building—more homes in all our communities. This will be a defining challenge of our generation.
Mims Davies (Eastleigh) (Con)
During the election, I received phone calls from people who had been in their homes for some time and were delighted to get the opportunity to buy them. On local plans and Labour’s top-down approach, is it not perfectly possible to build good-quality homes with a good local plan?
Brandon Lewis
My hon. Friend makes a good point. It is important that we show good local leadership and deliver good local plans setting out where homes can be built in communities and outlining the aspiration for good-quality homes and good-quality design. That is what local authorities and we in the House have a duty to do and what my hon. Friend has championed in the House over the last few months. This will be a defining challenge for our generation, yet the right hon. Member for Wentworth and Dearne, who spoke for more than 32 minutes, gave not an iota of a start of a Labour policy to tackle this problem. Instead, he fell back on outdated politics. I am afraid it was the Soviet version of “Back to the Future” after all. There is the lazy assumption that there is a contradiction between supporting the dreams of home buyers and ensuring that more affordable homes are built. Nowhere is this clearer seen than in the right hon. Gentleman’s opposition to our extension of right to buy for housing association tenants.
In the last Parliament, we dramatically improved the right to buy for council tenants, with 47,000 tenants seizing this opportunity and over 80% of the sales occurring under the reinvigorated scheme, yet 1.3 million social tenants in housing association properties continue to get little or no assistance. That cannot be right. We promised the electorate that we would end this unfairness.
Brandon Lewis
No, not at the moment.
Housing associations have recognised this inequality and have signed an offer to the Government that we have accepted—a historic agreement to end it. I thank the housing associations for doing that, and I applaud them for their forward thinking and their eagerness to help tenants own their own property, especially in light of the fact that this has bitterly disappointed the Opposition. Clearly, the housing associations have not followed the Labour party script and fallen obediently into line. Instead, what housing associations are doing is giving tenants what they want. That should not be a surprise, because the mission of housing associations is to deliver for their tenants. They are now passionate about doing that, providing tenants with an option to buy their home and a ladder to opportunity. Every property sold will lead to an extra home being built.
Julian Knight
Is the Minister aware that in the Select Committee I asked three leaders of housing associations whether they thought that Government policy would lead to their building more affordable homes to buy, and the majority agreed that it would?
Brandon Lewis
As my hon. Friend will know, having given evidence after being quizzed by the Select Committee, I am an avid proponent of what it does, and my hon. Friend makes the very good point that the policy will increase housing supply. The reality is that every property sold brings in money that will mean that extra homes get built—housing supply will go up. So it is time to end the baseless scare story that right to buy reduces the number of homes, particularly in London.
Let me provide hon. Members with some figures. After we reinvigorated the scheme for council tenants in London, 536 additional homes were sold in the first year, and 1,139 were built. Yes, hon. Members heard that correctly: two for one on right to buy homes in London already. We are building even more, and that success will now be repeated on a much grander scale.
Andrew Gwynne
I am grateful to the Minister for giving way, but he will, I hope, forgive my scepticism, given that in the Stockport part of my constituency, there have been 184 sales of council homes under right to buy over the last three years—yet not one single right to buy replacement.
Brandon Lewis
The hon. Gentleman’s council will want to listen to him and get on with building more homes. There is £2 billion-worth of headroom for all local authorities to build homes, but what I can tell the hon. Gentleman is that right across the scheme, housing associations will build a home for every home sold. Even under the reinvigorated scheme across this country, we are seeing one for one, while in London, as I say, we are already seeing two homes built for every one sold.
Brandon Lewis
I have already given way to the hon. Gentleman, and I want to make some more progress.
We are building even more, and that success will be repeated on a grander scale. Whether it be through right to buy, starter homes or Help to Buy: when buyers can buy, builders can build. We can support and we will support the aspirations of hard-working people. These plans are at the heart of our ambition to build those 1 million new homes. We are clear that we must go further and faster in all areas of housing supply. The Housing and Planning Bill is part of that, and it will give housebuilders and local decision makers the tools and confidence to deliver more homes.
I know that Members of all parties will want building on brownfield land to be the first choice at all times. Under this Government, brownfield land will be prioritised. New homes will be built near existing residents, so that their green belt and local countryside is protected. Regenerating eyesores and derelict land to create modern homes for the next generation is the opportunity that lies ahead of us. A new statutory register of brownfield land will provide up-to-date and publicly available information on land suitable for housing. Forty brownfield housing zones are being created across the country, including 20 in London. I thank my hon. Friend the Member for Uxbridge and South Ruislip, the Mayor of London, for working with us to deliver those homes in London. We want to see planning permissions in place for 90% of these sites by 2020. We will also change the parliamentary process to allow urban development corporations to be established more quickly and get on with delivering new homes at the earliest opportunity. Smaller firms in particular will benefit from quicker and simpler ways of establishing where and what they can build, especially with the new “permission in principle” for sites on the brownfield register.
The Bill will ensure that the planning system helps to drive our increased aims for the supply of houses. During the last Parliament, we reformed and streamlined the failing top-down planning system. We dismantled regional spatial strategies, and as Planning Minister, my right hon. Friend the Secretary of State was able to oversee the reduction of thousands of pages of planning guidance to just 50, thus creating a system that people can understand and work with. Today, local people are in control.
Mr Richard Bacon (South Norfolk) (Con)
My hon. Friend mentioned making it easier to establish urban development corporations. Will he also reflect on the possibility of establishing rural development corporations, with powers to make things happen quickly?
Brandon Lewis
I am always open to any ideas from local authorities that want to drive forward growth of that kind. We are already talking to authorities that want to be part of delivering for their communities. My hon. Friend has championed that work, because he wants to see local rural areas delivering housing, and I will be happy to work with him on that.
What we are seeing through this local system is that trusting local people and moving away from the top-down days of Labour’s past is working. We are seeing people develop their own plans for house building, and the system is faster and more efficient. Since 2010, the number of planning permissions for new homes has increased by 50%, and the number of local plans has more than doubled. Meanwhile, neighbourhood planning has captured the imagination of communities across the country. Following the holding of 125 referendums, each plan was approved by democratic mandate.
I know that not every authority has reached the stage that we would like them all to reach with their local plans, but if plans are not in place by 2017, the Government will work with local people to ensure that that happens, so that all local areas have the plans that they want for the homes that they need.
We have come a long way since the great housing crash of the last decade, when house building was in real danger of stopping altogether. We made the tough decisions to get Britain building again. We are still clearing up the mess that we were left, but now we are moving from rescue to recovery and thence to revival. Our investment in house building during the current Parliament is the largest for 40 years. We are determined to deliver a better housing market that secures our economic recovery, boosts productivity and rebalances the economy. Our plans go far beyond numbers, schemes and timelines; they are about people and their hopes and dreams; they are about supporting their aspirations and giving them the confidence that their hard work can be rewarded with home ownership and a place to raise their families. This is about having one nation, where whoever people are, and wherever they live, they can walk through the doors of opportunity and into a home of their own.
Alan Brown (Kilmarnock and Loudoun) (SNP)
The motion is about a scattergun approach to a very important topic. I understand it is aimed mainly at the last five years of the coalition Government and the direction they took. Of course, a standard one-line dig is now levelled at the SNP Scottish Government, as if that is somehow going to transform Labour’s fortunes north of the border.
Current policy ties in with decades of housing policy of Governments of all hues. There is no doubt that the roots of the current housing crisis stem from the Housing Act 1980—an Act that Labour contemplated introducing before it lost power—which led to the decimation of housing stock across the UK as a whole, the biggest problem being that those houses were not replaced. The reason they were not replaced was that the moneys from the sale of stock were either used to offset debt or reclaimed by the Treasury, so it was impossible for councils to replace stock.
Fast-forwarding to Scotland now, the SNP has recognised this issue. That is why we scrapped the right to buy. As of this year, the right to buy council houses has been eliminated in Scotland. We are also opposed to the extension of the right to buy to housing associations. By removing the right to buy and opposing it in housing associations, we preserve stock and allow better targeted new building of social housing to meet local housing needs. Labour had 13 years in power in the UK but did not do that and Labour did not do it in Scotland when it was in power for eight years. Labour could have invested in a council house building programme but, like the Tories, in the main chose to leave affordable housing to the markets and to social landlords. We have heard about the sorry state of affairs whereby the coalition Government actually built more council housing in five years than Labour did in 13.
On the council housing theme, I point out that in Scotland the Scottish National party has now delivered more than 6,000 council houses, which compares to a grand total of six that Labour delivered when it was in power. [Interruption.] I said that right, the figures are 6,000 versus six. There is no doubt that greater council house building just makes more sense. Councils can borrow at a lower rate, they can use their land supply and they can target regeneration. Those were all things I was pleased to be involved with as a councillor for East Ayrshire Council.
Given the increased discounts put in by the coalition Government for right to buy, what council in England is going to invest in council house building in the future, as its stock will be at risk of getting sold off? The same goes for the extended right to buy in respect of housing associations. They will not be able to borrow securely when they no longer know accurately what their future rent projection will be. Clearly, they could build houses but those could then be sold off, which distorts the whole model that housing associations were built on.
Let me now deal with one-to-one replacement. Despite what we heard from the Minister for Housing and Planning, it is a complete sham. It is based on a three-year cycle, and I understand that that is to allow for planning and getting houses coming out of the ground. The Government say that they have already achieved the one-to-one, but they are comparing the first year’s right-to-buy sales with the replacements over a three-year period. There has been a massive increase in the right-to-buy sales since then. The Library briefing paper shows that to stay on track against the increased number of right-to-buy sales, 4,650 houses need to be built every six months. In the first six months of this year, there were only 730 starts and acquisitions, so for the first six months of this year the Government have achieved only 15% of that required target. There is therefore no doubt that going forward the one-to-one replacement will not happen. When that is combined with the forced sale of the highest-value council properties, it is clear that this Government are going to create a worse housing situation in the long term, rather than do something to sort it, despite all the bluster we have heard.
There is still no definition of what one-to-one replacement is. The target is a national one, so it does not compel councils and housing associations to replace houses locally. It means that local needs and supply assessments do not govern the replacement strategy or housing strategy, whereas in Scotland the local needs and supply assessments are a prerequisite of Government funding The SNP Government, when funding social housing and council housing, are making sure that they take local needs and assessments into account. That is a proper strategic overview, which is the only way in which housing stock can be managed.
Another major issue I have with the right-to-buy policy is that councils are forced to subsidise home ownership through the sales programme as well as fund the rebuild without any Government money being added. Monetary experts agree that this is the time to invest in infrastructure, and clearly housing is integral to infrastructure. If the Government used the £10 billion to £12 billion subsidy that is getting used for right to buy for housing associations, we could create additional housing. That would help to tackle the housing problem, it would create more jobs and it would lead to a more sustainable model. If the Government were actually willing to put money up front, that would also lead to Barnett consequentials for Scotland, and I know that the SNP Government would use that wisely.
The right-to-buy measure in effect privatises housing associations. I draw a parallel with what happened during an early reading of the Scotland Bill when a proposal was made to devolve the Crown Estate. The hon. Member for North East Somerset (Mr Rees-Mogg) made an impassioned defence of the Crown Estate on the basis of the principle of not imposing a change of ownership. No Conservative Member is willing to come to the defence of housing associations, yet it is the same forced change of ownership.
Under the right to buy, large family houses have all but disappeared from council stock in some areas, and private renting has had to increase to compensate. That drives up housing benefit costs, which is counterproductive for the taxpayer in the long run. Many sold properties end up in the rented sector, especially flatted properties. Someone exercises the right to buy. Then they die; the flat is passed on to family and the family have no need for it. It ends up as a buy-to-let and the taxpayer pays more money for someone to rent that property than for the person in the council house next door. In a study by Glasgow university, this is estimated to have cost the taxpayer an extra £3 million a year in Renfrewshire alone. We also know that 40% of flats in England sold under the right to buy have ended up in the buy-to-let market. Clearly, that will only increase under the extended right to buy for housing association tenants.
We heard in the autumn statement of an additional levy on people who buy additional homes. That is supposed to provide some income to the Treasury and have a balancing effect on the buy-to-let market, but there is no doubt that it will not do anything. It will give the Treasury a wee bit more money, but the returns that buy-to-let landlords get will at least offset that one-off levy. So the taxpayer will still pay more money in the long run in housing benefit. Going forward, it is almost guaranteed that the only way the housing benefit bill will be reduced is if the Government take further punitive measures.
I think I have made it clear that I am against extending the right to buy to housing association tenants. It will lead to social cleansing—to a clearing out of people.
Alan Brown
They might do in the short term, but I can guarantee that they will get money from the taxpayer as a discount, then they will sell the property. Property developers will move in, they will demolish and rebuild and there will be an ongoing moving out of people. The social houses will not be rebuilt in that area so people on lower incomes will not be able to rent in the area that they were staying in. [Interruption.] I think I should be pleased. I am getting a wee bit of chunter, and that is maybe a good thing.
Affordable homes clearly need to be truly affordable. The SNP Government have made sure that that is the case, and it is part of our plan going forward. It is not the case here in London. A cursory glance at my local estate agent in Kennington where I have a flat for when I stay down here shows that the costs for one-bedroom flats are truly mind-blowing. I can understand why London has a housing crisis.
In Scotland the SNP Government have delivered 30,000 affordable homes since 2011, backed by £1.7 billion of investment and they are committed to 50,000 affordable homes, of which 70% will be available for social rent, if they are re-elected. Despite what the motion says, I can inform the House that the chief executive of Shelter Scotland has welcomed this commitment. We have had no such commitment from Labour as yet in Scotland.
Although we are against the extended right to buy, we are not against home ownership. I accept that many families welcomed the original right to buy and many people have benefited from it. However, the scheme has had its time and it is time to move on. The rhetoric comes back to whether we are for or against home ownership, but that is not the right message. I have concerns that the UK Government proposals for Help to Buy and right to buy will encourage more people to borrow. At present interest rates are at an all-time low, so homes may be on the cusp of affordability. People can borrow now, but when interest rates go up there will be a risk to the affordability of those homes.
Although the Government talk about reducing borrowing, the one-for-one replacement scheme is funded by additional borrowing by councils and housing associations. As we now know, housing associations are adding to the public debt and are on the public books, so there is no benefit from what the Government are doing. The long-term economic recovery plan appears to give a discount to home owners, but it will increase personal debt and force borrowing elsewhere for replacement housing. All in all, it is not a plan at all.
To meet people’s requirements, we need more houses to be built, based on local need and demand. Those must be truly affordable homes that are energy efficient. This would deliver health benefits and reduce the long-term housing benefit bill. A house building programme would create jobs, improve the welfare bill as more people would be working, and improve the Treasury’s income. That is the strategic plan that the Government should work to. It is one that the Scottish Government are doing their best to implement and they certainly will do so if re-elected next year.
Several hon. Members rose—
Madam Deputy Speaker (Natascha Engel)
Order. Before I call the first Back-Bench speaker, we are going to start with a five-minute limit and see how we get on. If interventions are kept to a minimum, we can keep it to five minutes.
Jake Berry
On a point of order, Madam Deputy Speaker. I seek your guidance. Given that housing is completely devolved to Scotland, it does not seem reasonable that the Scottish National party spokesperson should take up about 15 minutes, when there are many Back-Bench colleagues who want to speak. Now, you have imposed a five-minute time limit on an extremely important topic. [Interruption.]
Madam Deputy Speaker
Order. That is not a point of order. The SNP is the third party, so its spokesperson has every right to make a speech. We should keep such points of order to a minimum so that we do not eat even more into the time of Back Benchers.
Mr Richard Bacon (South Norfolk) (Con)
The right hon. Member for Wentworth and Dearne (John Healey) opened the debate by referring to five years of failure. By the way, I do not know where he is. He seems to have done a bunk. He spent a little time in the Chamber; he did not turn up to the Committee stage of the Bill at all, which for a shadow housing Minister strikes me as a little odd. What he should have referred to is five years of recovery from the dreadful situation we inherited. I enjoyed his speech.
Dr Roberta Blackman-Woods (City of Durham) (Lab)
Unfortunately, my right hon. Friend has had to go and meet the Minister because of the decimation of the steel industry in his constituency.
Mr Bacon
I understand that. It is a very good reason for not being in the Chamber. I enjoyed the right hon. Gentleman’s speech, particularly the reference to the money inherited from Labour. There was no money. I do not think he got the memo written by the right hon. Member for Birmingham, Hodge Hill (Liam Byrne) that played a significant part in the general election. The Prime Minister carried it round with him the whole time. The memo said that there was no money.
We have been facing not five, but 50 years of failure from all Governments, who have worked on the flawed assumption that only the Government can solve the problem. For 50 years Government have been part of the problem, getting in the way of the supply of housing being allowed to rise to meet demand. We saw quite a lot of finger-wagging from the right hon. Member for Wentworth and Dearne, but we heard nothing in the way of solutions. I listened to Opposition MPs carefully for many weeks in the Housing and Planning Bill Committee and I heard a lot of whingeing, but no real solutions. It is as if they have never asked themselves why the supply does not rise to meet demand. We do not talk about the shoe crisis, the jeans crisis, the DVD crisis or the chair crisis. Everyone in this Chamber is wearing a pair of shoes—including you, Madam Deputy Speaker, and if I may say so, yours are very nice shoes.
Mr Bacon
My hon. Friend should move along a bit. They are very nice.
No one says we need a national shoe service in order to solve the problem. We have a broken model, and it is this Government who are seeking to fix it. What I find so depressing from the Labour Benches is the paucity of ideas, the sheer paucity of radicalism. Almost every amendment proposed from the Opposition Benches during the Committee stage of the Housing and Planning Bill would have had the effect of slowing things down—sand in the gears, a spanner in the works. Labour Members do not seem to recognise that they are seeking to make the central problem—the problem of supply—even worse.
Last week Kevin McCloud addressed the all-party self-build, custom-build and independent house building group at our No. 10 summit, and I am very pleased that he was able to do so. He said:
“The consumer has been on the receiving end of a pretty poor deal. We build some of the poorest, most expensive and smallest houses in Europe. That’s not something to celebrate.”
Yet according to Ipsos MORI, 53% of the adult population would like to build a house at some point, 30% would like to do so in the next five years, and more than 1 million people would like to buy a site and start in the next 12 months. This can be done at scale. Adri Duivesteijn in Almere in the Netherlands has proved that it can be done, with serviced plots for over 3,000 dwellings. Cherwell District Council is now doing it in Oxfordshire, with over 1,900 serviced plots. This is the way to help supply rise to meet demand, putting the customer at the centre. Chapter 2 of the Housing and Planning Bill, on self-build and custom house building, will make that happen. The right hon. Member for Wentworth and Dearne did not mention chapter 2 or self-build and custom house building.
There are very legitimate reasons why local authorities might want to have and maintain affordable housing. In my view, they could and should use some of their £22 billion of reserves to establish, promote and grow mutual housing co-operatives for affordable rent. That is completely normal in Berlin, where it is called genossenschaften, and elsewhere on the continent. These arrangements are not relevant in terms of right to buy because they involve people entering into contracts with each other to form part of a co-operative. I thought there was a thing called the Co-operative party, but we heard nothing about this in the Bill Committee; I was the one talking about it. Interestingly, the local authority leader who showed the most interest in it when asked about in-perpetuity social rents in big cities was the Conservative leader of Westminster council, Philippa Roe, who said very seriously, yet with a gleam in her eye, “Yes, we’re looking at that.” From Labour Members, I am afraid we heard nothing.
We need vision and imagination, and the Bill will make that easier to achieve. Instead of building the most poorly performing, most expensive and smallest homes in Europe, we should do things differently. We should use our imagination and our knowledge to make the best places that we can, with the best-performing homes that we know how to build, in the most beautiful surroundings that we know how to create, where people will be able to find an education, find the skills they need for life, find a job they enjoy, perhaps start their own business, put down roots, build a house or have someone build a house to their own design, raise a family, and be part of a community. These are all normal human aspirations. We have to make it normal to achieve them, so that housing supply rises to meet demand here in this country, just as it does in the rest of Europe. That is the vision that we should pursue, and this Government, with the Housing and Planning Bill, will make it happen.
Julie Elliott (Sunderland Central) (Lab)
The Government’s record on housing over the past five years is sadly one of failure, and failure across all parts of the housing sector. It is a failure driven by short-termism, incompetence, and a lack of understanding of how millions of people live their lives. People in my constituency live very different lives from the people the hon. Member for South Norfolk (Mr Bacon) described. Most people in my constituency earn very low wages, often on very short-term contracts. Getting a home of their own—
Julie Elliott
No. Getting a home of their own is a dream too far; being able to self-build is absolutely out of the question.
Since 2010 this Government have presided over the lowest level of homes built in peacetime since the 1920s. This fact does not become dulled by repetition. Since May, muddled thinking has given way to contradictory policies. The Government give with one hand and take away with another. The Chancellor’s Office for Budget Responsibility confirmed in November’s “Economic and fiscal outlook” that Government policies since the election will lead to 34,000 fewer housing association homes being built over the next five years.
I share the Government’s desire to create a property-owning democracy for those who want to own their own home. I can therefore only assume that the Secretary of State shares my disappointment that home ownership under this Government has fallen by over 200,000 to the lowest level in 30 years, below the EU average for the first time on record. To choose a period at random, from 1997 to 2010 the number of homeowners rose by more than 1 million. The rise of insecure working practices, such as zero-hours contracts and underemployment, has meant that many people cannot save for a deposit or get a mortgage, because they do not have a permanent contract.
The state of social housing in many parts of the country is close to breaking point, with waiting lists of many years. If the Government are not sure why that might be the case, perhaps they could look back to 2014, when the number of homes built for social rent was at its lowest for at least two decades. The number of affordable homes provided in the past year fell by more than a quarter compared with 2010.
This Government simply do not get social housing. I sat on the Localism Bill Committee in the last Parliament, when a Conservative member of the Committee referred to social housing as “housing of last resort.” I was born in a council house and I grew up in that house and that community—it was my home. Council housing provides a safe, warm place for millions of people to call home. It is not housing of last resort. The proposal in the Housing and Planning Bill, which is currently going through this House, to scrap tenancies for life is a disgrace, and this Government should be ashamed for proposing such a change.
This Government have made it harder to build social homes by choking the planning system. They have consistently watered down section 106 affordable homes requirements, while in his day job as Mayor of London, the hon. Member for Uxbridge and South Ruislip (Boris Johnson), who is no longer in his place, has banned Labour councils from insisting on the building of genuine social homes through section 106 agreements in his London plan. He did that against the guidance of the planning inspector, but with the approval of the former Communities and Local Government Secretary, the right hon. Member for Brentwood and Ongar (Sir Eric Pickles).
With home ownership an unobtainable ambition for many, and with social housing in short supply, it should come as no surprise that the private rented sector has enjoyed tremendous growth. Although there are many good private landlords who provide decent homes for their tenants, many other tenants endure daily instability and short-term tenancies—typically of six months—as well as poor standards and rent increases at a pace that outstrips wages.
By every metric, and in whatever part of the housing sector, the situation has deteriorated in the past five years. I hope the Government can start to address the differing and diverse needs of families across this country with a comprehensive strategy that does more than simply manage decline.
Stephen Hammond (Wimbledon) (Con)
It is a great pleasure to follow the hon. Member for Sunderland Central (Julie Elliott), but I have to say that my conclusion from looking at every metric is rather different from hers. The right hon. Member for Wentworth and Dearne (John Healey) opened in his usual way, but, behind his façade of bluster, the only conclusion we can draw from the statistics is that the Labour party left a housing crisis in this country. Under that Government, house building was at its lowest level since the 1920s, while the housing available for social rent decreased and the number of those on the waiting list increased.
There are a huge number of possible solutions to that problem, but Labour Members have offered a paucity of ideas. This Government have delivered for the past five years and they are continuing to do so. They are delivering 753,000 new homes and 260,000 more affordable homes, and council house building is now at its highest level for 23 years. The Mayor of London, who is not in his place but I was pleased to see him here earlier, has a record to be proud of. He is on track to deliver those 100,000 more affordable homes over his two terms.
Being a London Member, I was also pleased that the Chancellor, in both the autumn statement and the Budget, ensured that there was housing news and opportunity across the country. In particular, I was delighted with the extension of the very successful Help to Buy scheme—which in the last Parliament helped 120,000 households to get on the ladder—to London. That will be really important for the other measures the Government are also putting in place in London to work. It is clear that this Government do not lack ambition and that they are not complacent.
I heard the right hon. Member for Wentworth and Dearne ask why the Government do not sell off some of their own land. In London, the London Land Commission is going to do exactly that, which will be hugely powerful in delivering extra affordable homes during the term of office of my hon. Friend the Member for Richmond Park (Zac Goldsmith), when he takes over as Mayor of London. The Under-Secretary of State for Communities and Local Government, my hon. Friend the Member for Nuneaton (Mr Jones), who is in his place, will know that the London Land Commission will undertake a review in a year’s time. When he looks at that review, I hope he might contemplate giving the Mayor the power to impose a duty to co-operate—or, indeed, a power to have a first right of refusal—so that if any public or local authorities drag their feet and hold back the aspiration to provide houses for Londoners, they can very clearly be told that it is their duty to co-operate with the London Land Commission and to get on with the job.
The Budget contained several measures that will be powerful in accelerating the number of houses likely to be built in our country. In particular, in-principle permission for brownfield sites will allow developers to bring forward sites much more quickly. It will enable them to understand what can be achieved in outline. Any number of large projects may benefit from that, but equally, so will any number of small projects. If developers have the confidence to know what they can do, they will invest in the technical detail, which will in turn lead to community support for community infrastructure—it may also create opportunities for self-build property, as my hon. Friend the Member for South Norfolk (Mr Bacon) has reminded us—and that will provide the opportunity for quality developers to bring forward quality developments on brownfield sites. Yet, Opposition Members have told people waiting to move into such homes, “Vote Labour— it won’t happen.” It is very clear that there is a real difference between us on such ideas and aspirations.
I know that the Minister is in the mood and has an appetite to deliver even more than the target of 1 million houses, so let me tell him that he could do a few other things. In particular, will he consider introducing a plan to allow small-scale developers—perhaps paying a small extra fee to accelerate the process—to fast-track small developments through the process more quickly? That would give us a real opportunity to bring on some of the smaller sites. We all want big developments, but small ones will help just as much.
This Government are absolutely right to be taking action on housing, which is the most important issue for our country. It was largely ignored during the 13 years of Labour failure, but I know that this Government have the ambition to build the homes in which the people of this country want to live.
Ms Karen Buck (Westminster North) (Lab)
I have spent too many years in the trenches of statistical warfare on housing supply, so today I want to use the few minutes available to me to talk about values.
Conservative Members have spoken about one aspiration—the aspiration for home ownership. That is an important and vital aspiration, because most people want to own their home if they can and we should help them to do so. The fact that the Government proposals for starter homes require households in my constituency to have an income of £101,000 does not fill me with confidence that the need will be met in central London any time soon. None the less, it is an important aspiration. Mobility is another important value, because we want to make the best use of the existing housing stock and we want people to be able to move around this country for work and other purposes.
I want to spend my few minutes talking about another value, which is the value of security. A home is not just based on an economic transaction—people do not just spend rent or mortgage payments to secure a bed for the night—but is where people bring up their family and experience community and neighbourliness, and it therefore means so much more to them. That does not disappear for people on low incomes: a home means as much to someone on a low income as it does to the millionaire who can spend £6 million to buy a home in the London luxury market.
Ms Buck
No, I will not give way, because too many Members want to speak.
What we have seen under this Government—although it did not start in 2010, of course—is an erosion of the principle of security. That erosion reached its nadir with the proposal to scrap the security of tenure for social housing. The proposal to scrap secure social tenancies will mean an intrusion into the lives of the poorest, and only the poorest, every few years as they are required to justify their home.
The principle of security is being eroded in many other ways. There has been a doubling in the number of families who are bringing up children in private rented housing, where they can only rely on a 12-month assured shorthold tenancy. The Government refuse to do anything to address the desperate need for longer security for people in the private rented sector. There has been an increase in homelessness. It was coming down for many years from too high a peak under the last Labour Government, but it is soaring again. There has been a fantastic 820% increase in the number of families being held illegally in bed-and-breakfast accommodation. Families are living, sometimes for years, in nightly booked temporary accommodation after they have been homeless. That has happened to my constituents. Insecurity is the new normal, but only for the poorest. Far from addressing that crisis, the Government plan to extend it and entrench it even more widely.
The stories of my constituents and the constituents of everybody on the Opposition Benches—and, quite possibly, the stories of the constituents of Government Members that go unheard—are stories of people torn away from their children’s schools, torn away from their parents, torn away from the people they have caring responsibilities for, torn away from the volunteering they do, torn away from their part-time or even full-time jobs and torn away from their communities. It is their children, above all, who suffer. The hyper-mobility that is forced on families at the moment is bringing about worse physical health, worse mental health, higher suicide risks and worse educational achievement. We are entrenching that into the lives of the poorest. Sadly, I do not have time to tell some of those stories, although I would love to be able to do so.
We know not just from the anecdotes, but from academic research that has been done in Australia and America, just how damaging this is. Communities suffer as well as individuals when the people who are the building blocks of communities—people who are registered to vote and who are civic participants—can no longer be so because they are forced again and again to move house. They are forced to move house every six months or every year, and now social tenants will be forced to move house every three or four years.
I will finish with a quotation from Professor Steve Hilditch, who for over 40 years has been an academic, a manager and a deliverer of housing. He says in respect of the end of secure social tenancies:
“Social rented housing is our most precious housing asset. Its existence broke the historic inevitability that people on low incomes and vulnerable people would also endure homelessness and dreadful housing conditions. It removed the blight of bad housing from generations of children. In my view it was the strongest mechanism of all to achieve genuine social mobility and to give children born into poor families similar opportunities to those enjoyed by better-off families.”
Mr Robin Walker (Worcester) (Con)
I am grateful to the Opposition for calling a debate on affordable housing, because it gives me the opportunity to point out the very different records of Labour and my party in both national and local government in supplying affordable homes in Worcester.
Affordable housing is one of the most pressing and important issues for me, as the MP for Worcester. It is the single most commonly raised concern at my surgeries. Although Worcester has seen nothing like the price inflation that has been seen in the south-east, the price of housing is a major worry for young people, whether they are students and apprentices setting out to rent or young professionals looking to buy their first home.
In our beautiful county town, a city of about 100,000 people, there is rightly pressure to build affordable homes on brownfield rather than greenfield sites, both to protect the stunning Worcestershire countryside, which is such an asset to our county, and to defend the vital floodplains on which we rely each year to keep the River Severn out of homes and businesses. I was pleased to hear in a recent meeting with the Environment Agency that it rates Worcester City Council as one of the best councils in the area at using the planning system to protect its floodplains. Given that we see winter floods almost every year, that is essential.
For as long as anyone can remember, Worcester has been bombarded by Labour leaflets telling people that Labour is the party of affordable housing. I remember fighting local election campaigns as long ago as 2001 in which every Labour leaflet was adorned with messages about affordable housing. In 2003, the Liberal Democrats went into coalition with Labour on the council, with the explicit aim of delivering more affordable houses. If Labour had any track record of success in this area, the leaflets would be understandable. Knowing the importance of affordable housing, I made it my mission to explore how much Labour administrations in the city had delivered.
The figures from Worcester City Council tell a stark story of Labour neglect. From 1997 to 2000, a period in which Worcester had a Labour MP, a Labour-led council and—oh joy of joys—that things-can-only-get-better Labour Government in Westminster, the council built fewer than 20 affordable homes per year. Very few of these homes, and none after 1997-98, were for affordable ownership, and the abysmal record of Labour when they had complete political control of Worcester was of just 22, then 11, then 19 affordable homes delivered—these figures in a city of 100,000 people.
Unsurprisingly, Labour was turfed out of control of Worcester in 2000 and a Conservative administration took control. What happened to affordable housing delivery when those nasty Tories took over? It rose 47% in the first year, more than doubled in the second year and then ran all the way from 2002 to 2012 at an average of 112 homes per year—five times as many as Labour had delivered. “Ah, yes,” said the Labour party, “but things slowed down after we lost power in 2010,” and yes, they did. Labour left us with the lowest rate of house building since the 1920s. It took years for the housing market to recover from the great recession that began in 2008, but in Worcester we kept on building affordable homes.
In 2012-13 the council delivered a remarkable 117 units of affordable housing, 79% of all new homes delivered in the city that year, under a Conservative administration.
Mr Walker
I am delighted with my hon. Friend’s intervention, although he may be less delighted to hear that the year he joined the Conservative party in Worcester was the year I was born.
What happened when Labour and the Liberal Democrats took control? Affordable housing delivery slumped, falling from 117 to 76, a decline of more than 30% in a single year. Worse still, the fall in delivery of housing meant a slowdown in receipts from the new homes bonus, a welcome financial incentive introduced by the coalition Government to support delivery of affordable housing. Not only did Labour’s chaotic year in control mean a more acute housing shortage, but it also meant damage to the city’s capital receipts.
Fortunately, the voters of Worcester, seeing the record of both Labour and the Liberal Democrats—who, alas, are absent from this debate—elected more Conservative councillors in 2014, and those mean old Tories took back control of the council once again. The result: an immediate recovery in the number of new affordable homes. The delivery of affordable homes in Worcester in the last year is the highest on record since 1997, and out of 460 new homes delivered in the city, 260 are rated as affordable. In 2015, new homes bonus income for the city rose to £5 million. The lesson here is stark: Labour always promise affordable homes, but only the Conservatives actually deliver them.
I know very well that there is still a great deal more demand, and the city’s own estimates suggest that this year’s record delivery is only the baseline for what is needed. In debates on building affordable homes it is often as if the only choice is to deliver them and concrete over our green fields or to give up on providing them altogether. That is simply not true. In fact, whereas a fifth of homes delivered in Labour’s one year of control were delivered on greenfield sites around Worcester, that figure has fallen, even as delivery of homes has increased, to only around 7.5% in the current year. Looking ahead, about 90% of the homes planned for in Worcester’s land supply can be delivered on brownfield sites, and I hope that figure continues to increase.
There is much the Government can do to further support the delivery of affordable homes in brownfield sites, and I am pleased to hear about the new brownfield fund. I hope the Government will look into more mechanisms to support renting above the shop and city centre living, which I believe can both help our high streets and address the desperate need for affordable homes.
I welcome the Government policies on Help to Buy. I have seen that for myself on the streets of Worcester, meeting people who have been able to buy their own home for the first time who would not otherwise have been able to do so. I particularly welcome the Help to Buy ISA. I also welcome the Government’s efforts to crack down on rogue landlords, going further than Labour ever did in their 13 years in office to deal with this very serious issue.
Today’s motion is typical of the relentless negativity we see from today’s Labour party. It says nothing about the aspiration of working families to live in homes they can own, nor the steps that have been taken, greater than under 13 years of Labour, to regulate rogue landlords. I am very proud that in Worcester, under a Conservative Government and with a Conservative council, we are delivering more affordable homes than ever.
Several hon. Members rose—
Madam Deputy Speaker (Natascha Engel)
Order. Before I call the next speaker, I am going to lower the limit to four minutes with immediate effect.
Helen Hayes (Dulwich and West Norwood) (Lab)
I am grateful for the opportunity to speak in this debate on housing; it is the single biggest area of concern to my constituents. Whatever measure we take, this Government have failed to deliver the homes we need in the areas where they are needed and at the pace which is required to address a housing crisis unprecedented since the second world war. If their own measure of success is home ownership, the Government have presided over a decline in the number of homeowners of 205,000 since 2010. If their measure of success is the housing benefit bill, the current Chancellor has seen an increase of £4.3 million in that bill over the past five years, including a doubling of the number of in-work households in receipt of housing benefit.
If the measure of success is, as it should be, the level of homelessness, there has been an increase of more than 50% in the number of people sleeping rough since 2010, and an increase in homelessness as a whole of more than a third. If the measure of success is the delivery of affordable homes, we see perhaps the Government’s most catastrophic failure: a decline of almost 75% in the delivery of new homes at genuinely affordable social rents since 2010, and a new definition of affordable rents, which makes a mockery of the term “affordable”.
In response to that failure, the Government appear to be constructing a new set of policies around an entirely arbitrary dividing line. Let us call it the aspiration threshold. Above that line, which quantifies at a house price of £450,000 in London, or an income of £90,000 with savings of close to £100,000, the Government recognise the aspiration of us all to have a stable home for the long term, to put down roots in our community, and to know that our children can attend the same schools for as long as they need to do so. Below that line, the Government do not recognise the legitimacy of people’s aspirations. They seem to believe that the most that council tenants deserve is five years’ stability at a time. In the private rented sector, it is viewed as entirely acceptable to live with the threat of a no-fault section 21 eviction. For those people, moving their children out of a school where they are settled and away from their friends in search of an affordable home is perceived as an acceptable way to live. For those people who are paying rent so high that they cannot afford to save for a home of their own, the aspiration of home ownership becomes increasingly hard to realise.
I do not understand why the Government are so focused on that arbitrary line. Most people in my constituency want the same thing: an affordable place of their own that is secure, safe, warm and suited to their needs. Most people do not want their aspirations to be achieved at the expense of others. Housing association tenants who would like to buy a home of their own do not want that to be at the expense of a family with two children in a one-bedroom home, whose aspiration to move to a council home big enough for their needs will not be realised if the Government force the council to sell off its larger family homes because they are the homes of highest value. We need to build more homes across all tenures, not one type of home at the expense of another.
The Minister for Housing and Planning came to the Communities and Local Government Committee this morning, and could not give any assurances that the numbers underpinning his proposed radical reform of housing policy add up. Next month, hon. Members will be asked to vote on a set of ideologically driven, uncosted and unproven proposals in the Housing and Planning Bill, which is a pitifully poor response to the biggest housing crisis that this country has faced since the second world war. The Government have a shameful record and are making an inadequate response. I hope that they will listen and introduce a more convincing plan to tackle the crisis.
Jake Berry (Rossendale and Darwen) (Con)
I direct hon. Members to my entry in the Register of Members’ Financial Interests. It is a pleasure to have the opportunity to speak in today’s debate. I agreed with much of what the hon. Member for Westminster North (Ms Buck) said about housing being largely about security. We must accept in this country that the British housing journey has changed. The private rented sector is now larger than the social housing sector and 11 million people live in privately rented homes. To give Members an idea of the growth in that sector, it increased by 69% between 1993 and 2013. More than 1 million families with children live in the private rented sector. I hope that the Minister will turn his attention to those families today.
In the mid-1980s, the age of a first-time buyer was about 25. It is now over 30 and, in some parts of London, over 40. The Housing Act 1988 introduced the assured shorthold tenancy for people who rent on a short- term basis while saving for a deposit to buy a home. It was specifically designed—I went back to Hansard and had a look—for students, professionals and short-term renters. In an age when people are renting for longer and with families, I believe that the assured shorthold tenancy is no longer fit for purpose for people in the private rented sector with families.
As the figures show, being in the private rented sector means that people move more often. People come to my advice surgery and say that they have struggled all year to save perhaps £100 a month towards a deposit to buy a house, only for those savings to be wiped out by the cost of moving, paying agency fees and a new deposit on a private rented home. That is borne out by Shelter’s statistics, which state that 60% of those in the private rented sector have no money left at the end of the month, other than to pay the rent. Santander states that 49% of people in the private rented sector have given up saving for a deposit to buy their own home altogether.
I welcome the Government’s Help to Buy ISA, which is hugely encouraging and helps those in the private rented sector to save up a deposit. Will the Minister update the House on his progress with the family-friendly tenancy? I have sent several written questions to his Department, and I would be interested to know how many family-friendly tenancies have been taken up and what reassurance has been given to lenders. When I worked in the Downing Street policy unit on that policy, lenders were reticent to grant longer tenancies because of their nervousness about seeking possession if they went in as mortgagee in possession. If, as I suspect, the number of family-friendly tenancies taken up is low, is it time for the Government to consider legislating in that area? Given that so many houses in the private rented sector now have their rent paid by housing benefit, it is surely not unreasonable for the Government, who are paying the rent, to ask landlords to offer more security to their tenants.
Finally, let me cover something different. As we approach Christmas we will all be thinking of homelessness, and I want to mention Joanne Atkin and Michelle Brindle in my constituency, who saw Carlos Maradona, a salesman of The Big Issue who works outside Sainsbury’s in Darwen. As well as coming to see me, they set up a crowdfunding page, so that everyone in the town could get behind Carlos at Christmas and help him to find a home. I will tweet the link after this debate, but I thought the House might be interested to know that we have already raised £1,400.
Several hon. Members rose—
Mr Speaker
Order. A three-minute limit must now apply to Back-Bench speeches because otherwise a lot of people will not get in.
Karin Smyth (Bristol South) (Lab)
I want to focus on supply and demand in Bristol, where the situation for buyers, and especially renters, is challenging. Information I have seen shows that property prices in Bristol have risen by between 7% and 9.7% in the past 12 months. Hometrack shows that of the 20 cities it monitors, only London, Cambridge and Oxford recorded a greater percentage increase than Bristol, and the influx of property investors from London and overseas is now a further influence on the Bristol housing sales market. One constituent who phoned my office told me that he was turned down for viewing a property because the estate agent had a queue of interested cash buyers.
The pressure felt by would-be buyers will increase further with the electrification of the London to Bristol line that will reduce travel times by 15 minutes, and effectively put Bristol on the same commuter belt as Oxford. Looking ahead, Halifax estimates that national house prices will rise on average by between 4% and 6%, and in high-demand areas such as Bristol that could be up to 10%. That is possibly good for investors, landlords and those who want to buy to let, but for young people and those looking to get on the housing ladder, it is not a good picture.
Rents have been rising throughout 2015, and they are expected to rise in 2016. This month, a local estate agent in my constituency told our local newspaper:
“If I take our Bedminster branch, there are 15 or 20 enquiries a day for rental properties, and the supply is maybe four or five a week, so the numbers are chilling. I’m pretty sure that the stamp duty rise on second homes will have an effect. It will force people to think twice and it will take a pretty robust person to buy a property to rent out. It is a bad thing for the Government to do because there is a massive shortage of properties to rent in the Bristol area and it will exacerbate the problem.”
Other factors that make the situation even bleaker include average prices of £210,000 and salaries of £22,000—I dispute the assertion by the hon. Member for Peterborough (Mr Jackson) about houses being affordable above a line from the Severn to the Wash. Some 10,000 people in Bristol are waiting for social housing, and thousands of properties are standing empty. Some councils in the south-west are doing good work. A local council in Plymouth has plans for homes, plans for social rent, a plan for empty homes, a charter for private rented housing and a plan for social rented housing. That is a Labour-run council—a small blot of red in the blue that is the south-west of England. Bristol and other local authorities need to learn from each other and share good practice. Also, the Government need to support local authorities that are trying to achieve something. The Government need not only ambition but a better plan.
James Cartlidge (South Suffolk) (Con)
I should like to begin by declaring my interest. I am a controlling director in a mortgage broker and property portal dedicated to shared ownership, and chairman of the all-party group on housing and planning.
When we talk about housing at the moment, there is obviously a focus on new build and on supply, but as I said in my intervention on the Minister, I still think that one of this Government’s most radical changes is the one we are making to buy to let. In the last Labour Opposition day debate on housing, in June, I spoke on buy to let and said that I was looking for three changes from the Government, relating to the rate of stamp duty, to tax relief and to mortgages.
Two of those changes have been delivered, including a measure on stamp duty. I said that it was completely unfair that a first-time buyer should pay the same rate of stamp duty as someone buying their 25th portfolio buy-to-let property or a second home as a holiday home. The Chancellor has had the courage to make that change, which no Labour Chancellor ever made. On tax relief, I said that it was wrong that first-time buyers or other home owners, who no longer have mortgage interest relief at source—MIRAS—should not have tax relief when buy-to-let landlords do so. Again, we are addressing that.
Of course the buy-to-let change is controversial, and we are now experiencing a backlash from The Daily Telegraph and others against it. In the one minute and 44 seconds remaining, I want to remind hon. Members why it is necessary. The Bank of England’s Financial Policy Committee’s minutes show that the rate of credit loss on buy-to-let mortgages in the UK has been about twice that for residential mortgages, despite the fact that 75% of buy-to-let lending remains interest only. In the past year, there has been £28.5 billion of lending with no repayment of the debt. For me, any area of the economy that requires tax breaks and non-repayment of debt to survive is unsustainable. The buy-to-let sector has not been sustainable.
That does not mean that we have something against those who wish to buy a property to let. I accept that some people use such properties as their pension, and some are saying, “It’s my pension. Why are the Government hitting me?” One change that must come out of this proposal is that we have to talk, as a country, about the fundamental issue of pension reform. If we can do that, it will represent an important gain. Luke Johnson has written in The Sunday Times:
“We cannot prosper as a nation of buy-to-let landlords; we must also produce goods and services and export to pay our way in the world.”
That means investment—not just foreign investment but our own investment—as well as a higher savings ratio and a more sustainable economy. I believe that a key part of that will be a more sustainable housing market in which first-time buyers have a reasonable chance of buying the properties which, at the moment, are being taken from them by people who will then rent them out to those same people who want to be first-time buyers. This is a fair move and it is being brought in by this radical Conservative Government.
Richard Burgon (Leeds East) (Lab)
In the brief time available, I want to highlight the problem in Leeds, to illustrate the fact that it is indeed a nationwide problem and not one that affects only London and the south-east.
In Leeds, buying a home is increasingly unaffordable, and that includes starter homes. According to the National Housing Federation’s paper, “Home Truths 2014/15: Yorkshire and Humber”, the current average house price in Leeds is £179,000, which is seven to eight times higher than median earnings in the city, depending on whose figures are used. That makes a mortgage unobtainable for vast swathes of the population.
Projections from the Office for National Statistics and the House of Commons Library have suggested that by 2020, starter homes could cost around £162,000 in Leeds. If that turned out to be the case, that would be significantly below the cap. However, the average income needed for such a property would be £45,000, and the reality is that gross median income in Leeds is currently around £22,000. Unless median income doubles in the next five years, starter homes will remain unaffordable.
Richard Lewis, Leeds City Council’s executive member for regeneration, has said that the council’s ambitions for a new generation of housing are at risk because of
“central government’s focus on starter homes above all other types of housing and their attempts to reduce housing mix through extending right to buy and forcing the sale of council homes”.
The right to buy sell-off of council homes is resulting in local authority housing stock being diminished, with very little replacement. Over the past three years, 1,159 Leeds local authority properties have been sold, with only 59 replacement starts—a ratio of 20:1.
Renting is increasingly unaffordable for a wide variety of groups. The Leeds Tenants Federation states that, even in council and housing association properties, some people are spending between 40% and 70% on rent. Many in Leeds are also struggling with private rent. Indeed, the council has previously written to the Communities and Local Government Committee to say of the private rental sector that
“rents are now taking a greater proportion of income”.
It said:
“There is an increasing issue of affordability across all sectors of the private rental market.”
So there is much to do.
The Conservatives spent the last Parliament blaming Labour, but that will not wash any more. They have their own record now, and on housing, both in Leeds and across the country, it is five years of failure on every front, with unaffordable home ownership, rising rents, deep cuts in investment and the lowest level of house building since the 1920s. There is a lot of work to be done. The blame game has to end, and the work must start and then be finished.
Kevin Hollinrake (Thirsk and Malton) (Con)
It is as true today as it was 30 years ago that more than 80% of people aspire to buy their own home. On the other side of the equation, house builders make their living by providing as many homes as possible. There is no lack of will to build, or a lack of desire to buy. The problems are due to the supply-side issues in the marketplace. Supply is constrained by a planning process that is not fit for purpose. There is a shortage of viable land, as much of it is locked away in public sector land banks, and a major demand side issue, in that house prices are simply out of reach for far too many people.
Fundamentally, the supply-side issue is the one that we most need to resolve. Simplicity is the ultimate sophistication: build more homes and most of the problems of affordability will fall away. We are building more homes. There has been a 56% rise in housing starts since 2010, and the number is now running at 136,000 a year. Planning consents are at a post-recession high of 240,000 a year, which will inevitably lead to more homes being built.
I welcome the provisions of the Housing and Planning Bill and its objective to increase further house building and home ownership. I welcome, too, the brownfield register, permission in principle, the simplicity of starter homes with a 20% discount, and right to buy.
The hon. Member for Kilmarnock and Loudoun (Alan Brown) may be interested to know that we took evidence from Dr Mary Taylor, the chief executive of the Scottish Federation of Housing Associations. She was asked whether, if there had been a one-to-one policy for right to buy, she would have got behind that policy. She said that she might well have had a different view.
One third of all people in relative poverty are there due to housing costs alone. The additional homes created by right to buy, and funded by making greater use of taxpayer-owned assets held by local authorities, will deliver affordable homes to buy, for shared ownership, and to rent. I share the views of my hon. Friend the Member for Rossendale and Darwen (Jake Berry) that we need longer, family-friendly tenancies and client money protection schemes for letting agents.
Earlier, I mentioned the huge swathes of land held in the public sector. The Government have pledged to bring forward enough public sector land to build 150,000 homes over the next five years. I am concerned that this land will be released and that we may need incentives to ensure that surplus, under-utilised land in our public sector is made available for development for our housing associations and the private sector. I offer strong support for this Government’s record on housing, and believe that the new initiatives in the Housing and Planning Bill will help to deliver a housing market that works.
Jess Phillips (Birmingham, Yardley) (Lab)
Successive Governments have failed to build anywhere near enough houses. The Government’s current Housing and Planning Bill at least tries to deal with some of that fallout. However, as with so many of their current policies, we are expecting those with the least resource to pay for our mistakes.
The spare room subsidy was the first assault on the most vulnerable people to right that wrong. I worked with a young woman who, due to violent and persistent domestic abuse, needed to go into hospital to deal with her severe physical and mental health problems. For that period, her child was removed to foster care. When she returned home, she began the process of rebuilding her relations with her daughter. Her daughter remained in foster care to give them both space to recover. The period of time was such that she was considered to be under-occupying her property. She fast built up arrears and debts and was eventually evicted, leaving her with no stable home for her child to return to. That woman lost her home, her health and her daughter, and all she needed was a chance. Was it her fault that houses were not rebuilt when they were sold off? I do not think so, yet she paid the price.
The bedroom tax was an instrument meant to encourage people to move out of properties that could be used for a bigger family, but it does not work like that if there is nowhere for them to go. It just makes money out of those who simply cannot bear it. The blunt-ended policy fails to recognise the realities of people’s lives. Some of the proposed elements of the current Housing and Planning Bill will do exactly the same.
The Government’s intention to end lifetime and successive tenancies is meant, again, to encourage people to free-up much needed properties. That is all well and good, but similar to the problems faced by bedroom tax victims, life does not work like that. When an adult child has a choice to give up their own tenancy and livelihood to move in and care for an elderly mother or father, they have a very tough choice to make and will be unsure of their own future. When a victim of domestic violence is rehoused with her children, who have probably been through enough, will we say, “Sorry gang, you’ll have to move schools pretty much every five years”? Will the Government fund all of the new housing officers that will be needed to ensure that the system works fairly? I wonder whether any of the Ministers have sat in their local housing queue recently. I have; it takes hours to be seen.
I do not want to stand here and moan. I want the Government to do something and have some positive suggestions. If they are going to encourage people to move in and out of social housing more frequently, they need to invest heavily in temporary accommodation. Currently, there is no temporary accommodation. The taxpayer funds bed and breakfast accommodation for families to live in—where used condoms are stuffed into the walls and there are dirty beds—when there is nowhere for them to go. The Government must invest in that. They must also look at models such as the one we have in Birmingham, where we have a social lettings agency with an honest broker, two-year tenancies and help with deposits for tenants coming out of social housing.
The Government should look at those suggestions before they rush into something that will show up in my surgeries in glorious technicolour.
Seema Kennedy (South Ribble) (Con)
It is a great pleasure to follow the hon. Member for Birmingham, Yardley (Jess Phillips). I draw hon. Members’ attention to my entry in the Register of Members’ Financial Interests.
Last Friday, I visited a new development in my constituency, Saxon Place in Penwortham. It is a mixture of family homes for rent and for sale under shared ownership. I mention that because I had the great pleasure of serving with many hon. Members on the Housing and Planning Bill Committee. There was a lot of talk about the affordability of starter homes and a lot of the conversation was very London-centric. My point is that, in many parts of the country including Lancashire, the starter and affordable homes really are affordable. On the average income in my constituency, a family could, under the shared ownership scheme, get a deposit of between £2,000 and £5,000 and have an equity stake in that house. I remind hon. Members that the world does not end at Watford Gap.
We agree that most Britons aspire to home ownership, but we have had a problem in getting more houses built. We have a growing population and more and more people live on their own. We need to be flexible about what we build. I was particularly pleased with the measures on automatic planning permission for brownfield sites. I have experience of developing brownfield sites. In the past, remediation works were costly and difficult. The fact is that we are getting better at that and prices are coming down. The provisions will start us on the way to building more homes. As my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) said, we just need to increase supply. It is not the whole answer, but we absolutely must build more homes.
The important thing about the outline nature of that permission is that it gives reassurance to the developer that he can invest, but leaves the right amount of risk on the business rather than on the taxpayer. If we were to change the outline permission to make it more detailed, winding up in red tape, it would slow down the process, and there would be far too much onus on the taxpayer rather than on the developer. I also greatly welcome the Government’s pledge to bring forward more public sector land to build more homes.
The Bill is forward looking. We are tackling rogue landlords, and I welcome the investment in garden cities. We need more homes and the Government are determined to deliver them. The Bill will go a great way to doing that.
Kirsten Oswald (East Renfrewshire) (SNP)
It is evident that there are Members in the Chamber, such as the hon. Member for Rossendale and Darwen (Jake Berry), who are strong supporters of English votes for English laws and who question why Scottish Members are speaking on a matter that should be fully devolved to the Scottish Parliament. I point out that Scotland is specifically mentioned in the motion we are debating today. The fact is that housing is an area where the headline statement of devolution is seriously undermined by a haphazard split of responsibilities between this place and the devolved Administrations. As a result, many decisions taken in this place can have serious implications for the delivery of housing policy in Scotland, and for the real issues and concerns of so many people.
The UK Government have stated that they want to transform generation rent into generation buy. It is certainly no bad thing to buy a home, but it must be financially sustainable, it must be right for one’s circumstances and it must not be at the expense of future housing stock. The UK Government must focus on alternatives, too. We have heard concern from Members on both sides of the House about homelessness, which is a very real and very destructive issue. I gently point out that we should concern ourselves with this issue all year and not just at Christmas.
The UK Parliament has lost its focus on the quality and quantity of housing. I entirely agree with my hon. Friend the Member for Kilmarnock and Loudoun (Alan Brown) that this can be traced back to the Housing Act 1980, when the Thatcher Government introduced right to buy. The policy has been popular with beneficiaries, but it has had serious side-effects on the quality of housing in the social rented sector and in entrenching deprivations in the areas of social rented housing that have not been sold off.
This Conservative Government are now going further than Mrs Thatcher. Owner-occupation is seen as the normal tenure for all households, regardless of income. This is exactly the approach that led to the American sub-prime scandal. Dame Kate Barker described the policy as
“people who are just on the cusp of being able to buy”
being nudged over the edge. It did not end well.
The Government’s thinking is that the social rented sector is a temporary stop-gap, where tenants should not regard their residence as a permanent home. They seem keen to import the deeply damaging and socially divisive concept of welfare housing. These policies are a smash and grab raid by the Chancellor on the assets of the social rented sector. Forcing councils to sell their best assets strengthens the social segregation that scars too many parts of this country and the forced sale of housing association properties represents the abandonment of those forced to wait for years for a decent home. Even The Daily Telegraph described the policy as
“dumb, economically illiterate…morally wrong…and close to absurd”.
The contrast between this shambles and the action being taken by the Scottish Government could not be starker. Instead of viewing housing as a weapon in a political game, the Scottish Government act on the basis that decent, accessible and affordable housing is central to the delivery of many other policy objectives. If we in Scotland had built houses at English rates since 2007, we would have 42,000 fewer homes. In fact, the Scottish Government have committed to something the UK Government no longer do: build both social and affordable housing.
Chris Philp (Croydon South) (Con)
I draw attention to my entry in the Register of Members’ Financial Interests.
I would like to start by replying to some of the points the shadow housing Minister, the right hon. Member for Wentworth and Dearne (John Healey), made at the beginning of the debate about the respective track records of this Government and the previous Government. In particular, I would like to draw attention to the number of housing starts across the country as a whole in the past year, which was 165,000, compared to the right hon. Gentleman’s last year as Housing Minister when the figure was just 124,000—a 33% increase by the current Government, which is an extremely impressive record.
The hon. Member for Sunderland Central (Julie Elliott), who I see is in her place, drew attention to affordable housing. I am similarly pleased to report to the House that, according to House of Commons Library figures, last year 67,000 affordable houses were delivered compared to just 58,000 in the last year of the previous Labour Government. I think there is a record to be proud of.
I was privileged to serve on the Housing and Planning Public Bill Committee for 17 sittings with the hon. Member for City of Durham (Dr Blackman-Woods), but not, I regret, the right hon. Member for Wentworth and Dearne, who did not grace us with his presence. I was disappointed by the lack of new ideas in his speech earlier. I thought we might have heard more from a shadow housing Minister.
There is a great deal to welcome in the Bill, not least the idea that every single local authority must have a local plan by 2017; the local development orders to give outlying planning consent on brownfield sites, which my hon. Friend the Member for South Ribble (Seema Kennedy) mentioned a few moments ago; and the London Land Commission bringing forward public sector land. The GLA has done that successfully: 98% of its land is being brought forward. I suggest to the Minister that the London Land Commission be given more powers to take hold of the surplus public sector land identified and make sure that organisations such as the NHS, Network Rail and Transport for London do not shilly-shally or delay.
I have one or two other suggestions. Parts of the planning process can be cumbersome, with reports on things such as bats and newts—
Chris Philp
Yes, indeed.
If there is any way of lightening the process, it would be welcome. Similarly, many developers would be happy to pay higher planning fees in exchange for guaranteed faster decision making, perhaps with the extra fees being refunded if the service level was not met. I hope the Minister will take those constructive ideas in the spirit they are intended.
In summary, having sat on the Bill Committee for 17 sittings, I am absolutely confident it will increase the supply of new homes and promote homeownership, and I strongly welcome it.
Dr Rupa Huq (Ealing Central and Acton) (Lab)
In 1892, Mr Pooter, from “The Diary of a Nobody”, was the archetypal suburban London Mr Average, but on current figures he could not afford today to live where he did. In 2009, The Spectator said his home would be worth £1 million and that his clerk’s salary would be £40,000. In Ealing, a typical suburb, the figures are astronomical and are placing an average suburb out of reach for the average Joe and Josephine, for whom suburbia was intended. Last year, average rents were £1,400. According to this year’s Land Registry figures, a terraced house in W5 now costs £781,000.
The Government’s housing record is one of abject failure, on homelessness, homeownership, house building, rents and, crucially, supply. Shelter, an objective charity, says that channelling existing public resources to build homes that only those on high incomes can afford will result in 180,000 affordable and low-rent homes not being built or sold. That is as a result of the changes in the Housing and Planning Bill. The goalposts have been moved several times. In respect of rents, “affordable” can now mean up to 80% of market rents, which is just not realistic.
These subsidised starter homes have been trumpeted, but they are a non-starter for people in my constituency. In Ealing, average earnings are about £34,500. If someone wanted a shot at just a one-bedroom starter home in W13, they would have to earn £73,142. In W4, it is even worse: £90,501. At first sight, the 1% rent reduction looks good, but it will have massive unintended consequences. I went recently to the reopening of the YMCA foyer in my constituency. It has sunk all its assets into it, based on a business plan of rising rents, and it now expects to be completely sunk. It was a massive oversight not to have exempted supported housing.
There is so much I could say about the mandatory “pay to stay” policy. The figure of £40,000 means two incomes of £20,000, which is not a princely sum in London. It is an attack on aspiration, which Conservatives keep talking about. Our capital city is being hollowed out, as we pay ever more for housing yet become ever more insecure at the same time. The Spectator says that Holloway is now becoming banker land. I fear that not just Mr Pooter but many others on average and modest incomes are being forced out of London, which is being left to bankers, oligarchs and off-plan buyers, whose playground our capital is becoming.
Mike Wood (Dudley South) (Con)
I welcome the Opposition’s choice of motion, but I was disappointed by the shadow Secretary of State’s lack of humility when he moved it, given his own underwhelming record in government.
As the shadow Secretary of State correctly said, housing is a top-four issue. I am sure it is towards the top of most of our postbags. The challenges of housing, rent and affordability are among the major challenges we face, and they deserve better than the rehashed diatribe we heard at the start of the debate. What we are seeing from this Government is the largest land building programme in decades, which will help to address the fundamental problem behind both the availability and affordability of housing.
As my hon. Friend the Member for South Norfolk (Mr Bacon) correctly said, the elephant in the room is the issue of supply. Why is there this market failure that we do not see in other areas of the economy? Part of the answer is regulatory failure. The Government cannot control all the levers that affect supply, but it is right for them to do what they can to eradicate some of the barriers to that market entry.
There are two elements at the core of addressing supply. The first is action to bring brownfield land back into productive use for housing. That is why I am so pleased that the Government are introducing this assumption of planning consent for developments on brownfield land. Devolution deals around the country are important, too. The devolution deal reached in my west midlands region is a combined authority with the powers of investment to bring brownfield land, and particularly contaminated brownfield land, back into use so that it can be made part of the land supply for our housing market. That is good for the environment—using brownfield instead of green spaces—good for housing and good for the economy.
The second area that needs to be addressed to increase supply is preventing the planning system from becoming a bottleneck to the availability of housing. The Government’s action to move away from the regional spatial strategy towards local plans as well as introducing planning in principle is absolutely vital and will hopefully mean that we have the supply to match this record house building programme.
Andy Slaughter (Hammersmith) (Lab)
Members who picked up the Metro this morning on the tube will have seen that Hammersmith features in this week’s property page. They will have found out that the average price of property there is just over £1 million, although they managed to find a one-bedroom basement flat for £425,000, which would be just within the starter home bracket, requiring an income of only just over £100,000 to snaffle that up. The more typical development—the new development with no social housing given permission by the previous Conservative council—sees a two-bedroom flat in Fulham going for £1.2 million or a three-bedroom flat in the Queen’s Wharf or Sovereign Court for £2.2 million.
That is why owner-occupation has dropped from over 40% to just over 30%. Local people cannot afford to buy those; they are bought by foreign investors from United Arab Emirates, Malaysia or wherever, and are either left empty or rented out, which is why the private sector has gone up from 30% to 40%, but all properties are unaffordable. I am afraid that I have to include in that list of unaffordable properties the 85% of council right to buys, which are now rented out at market rates, and mainly to local authorities that are now paying three or four times what it would cost to live in council accommodation. We know what the Housing Minister thinks about this because he recently said that
“if people want to live and work in and around London, it’s actually making a judgment call about what you can afford”—
in other words, “on yer bike”.
One type of housing is affordable—30% of the accommodation in my constituency is still social housing. Most Governments in the past, irrespective of party, would have regarded that as an asset, but not this Government. What are they doing? They are selling off housing association homes so that they in turn can be turned into buy to let at market rates, and they are selling 50% of the remaining 12,000 council stock in order to subsidise that sale.
When voters voted to get rid of the Conservative council that was selling off empty council properties—it sold off 300 and was warehousing and emptying blocks of council flats and constructing zero social homes in new developments—they thought that they had got rid of all that. Now, however, we have a Government who are bringing it all back at the national level through the Housing and Planning Bill. There will be no social homes built in the future—nothing that is affordable to my constituents.
I am pleased that my hon. Friend the Member for Westminster North (Ms Buck) is sitting next to me. Her speech hit the nail on the head when it comes to the most disgusting thing this Government are doing—removing security from people who live in council homes and telling them that they will have temporary housing as a form of charity rather than a permanent home in which to bring up their families.
The Government have reversed their position on “pay to stay” for housing associations, which is welcome, but they should do the same for everyone. They should let families on modest incomes continue to live in secure homes in London and around the country, and end this appalling business of removing security of tenure from council tenants.
Huw Merriman (Bexhill and Battle) (Con)
We are simply not building enough to keep up with both the demand and the challenges that are faced by many of our constituents who want to buy homes of their own. Government initiatives are radical and welcome, but I would advocate further action, and I hope that the Government will consider some of the following proposals.
First, there is a need to build on green spaces. Nearly 80% of my constituency is designated as “area of outstanding natural beauty”. There is a shortage of land afforded for local employment, but where there is such land, it is on brownfield sites. If the tens of thousands of houses that my district councils intend to build are allocated to brownfield employment sites, where will our current and next generations of homeowners work?
In one of my parishes, the village petitioned the district council to allow a small housing complex to be built on a green field just outside the building boundary. As a result of the campaign for building to be allowed on that green site, Etchingham now has a new school, a new village hall, and new affordable housing—all of it courtesy of that bold move. I should like the Government to make it easier to allow parish and town councils to make such decisions. When a district council has a plan, parishes and towns are required to conform to it; if they do not do so, their own local plans will not be approved by the district council. I should like to free parishes and towns from the shackles of district plan compliance. If they want to designate a site, then let them do so, and let them override district plans for their own purposes if that is within the planning laws.
Secondly, there is a need to deliver more infrastructure. Although the argument that more housing is required is being won, there is a real fear that communities will not have schools, doctors and other essential public services until the housing has been completed. If authorities could deliver infrastructure at the same time as building began, the public might embrace the building of more housing, and might even ask for more housing than had been scoped if, say, a new secondary school would be built with a few hundred more houses. I should like local authorities to be given the power to borrow money against the receipts from new homes bonuses, although, of course, that would work only if the new homes bonus scheme were extended for as long as the plans.
Thirdly, consent needs to be turned into new homes. The amount of land where planning consent has been granted but work has not begun continues to cause concern. The lack of building not only adds to the problem of a shortage of housing numbers, but also deprives local authorities of the ability to collect receipts from section funding or community infrastructure levies. I would support a policy that required developers to pay a first instalment of section 106 moneys within 12 months of the granting of planning consent, rather than on the completion of developments. Such a policy would not only incentivise house building and increase stock, but would permit local authorities to deliver vital infrastructure in parallel with house building.
The need to tackle our housing shortage is a huge priority. It is a national tragedy that more is not being done, but I support the Government on what is being done.
Daniel Zeichner (Cambridge) (Lab)
I am grateful to you, Mr Speaker. My city of Cambridge is in the grip of a housing crisis, and I have 110 seconds in which to speak.
An email that I received from a constituent recently encapsulates the problem. She wrote:
“I live, work and pay my council tax in Cambridge. Housing in Cambridge is almost as expensive as London these days. I was very excited to hear about the help to buy ISA—but Cambridge should have the same threshold as London of £450,000. Looking at rightmove right now, it is disheartening that there are only 4 properties that would meet our criteria of 3 bedrooms and the Government’s criteria of maximum £250,000 within a 5 mile radius of Cambridge…How are we supposed to buy, afford and raise a family in Cambridge?”
There are only four of those properties—four!
Perhaps the Minister will be able to answer my constituent’s question, but I personally doubt it, because I do not think that the Government have a clue about the real problems that face young people in Britain today. If young people such as my constituent cannot afford to buy, they have to rent, and do we hear anything from the Government about helping renters? I do not think so. If they were really listening, they would know that when house prices become unaffordable in areas like mine, the nature of the private rented market changes. Young families who would once have bought are staying longer in the rented sector, but the legislation has not kept up; the Government have not kept up.
Let me skip the points I was going to make about the attack on social housing and conclude by saying a little about the impact on business. My right hon. Friend the Member for Wentworth and Dearne (John Healey) visited my constituency recently and even he, experienced on these issues as he is, was shocked by the consistency of the message from employers. In every sector, be it the thriving life sciences and tech sector, research and our universities or major public sector employers such as the NHS, the message is clear: we cannot recruit and we cannot retain staff while housing remains so unaffordable. This is therefore not just about housing; it is about social justice and inter-generational justice. At the start of my speech I quoted the question from my constituent and I urge the Minister to answer it:
“how are we supposed to buy, afford and raise a family in Cambridge?”
Teresa Pearce (Erith and Thamesmead) (Lab)
In a wide-ranging debate, we have heard contributions from Members in all parts of the House, including the hon. Members for Wimbledon (Stephen Hammond), for South Ribble (Seema Kennedy), for Croydon South (Chris Philp), for Dudley South (Mike Wood), for Thirsk and Malton (Kevin Hollinrake) and for East Renfrewshire (Kirsten Oswald); my hon. Friends the Member for Ealing Central and Acton (Dr Huq) and for Hammersmith (Andy Slaughter); the hon. Member for Bexhill and Battle (Huw Merriman); and my hon. Friend the Member for Cambridge (Daniel Zeichner). My hon. Friend the Member for Birmingham, Yardley (Jess Phillips) made a passionate speech about the human cost of the housing crisis, and my hon. Friend the Member for Sunderland Central (Julie Elliott) also spoke with passion about the shortage of social housing. Most interestingly, the hon. Member for South Norfolk (Mr Bacon) spoke of not only his well-known interest in self-build, but his less-known interest in the Deputy Speaker’s shoes.
Clearly, the housing crisis is one of the greatest challenges to face our country in recent times, and Members from across this Chamber know the impact that housing has on their constituents’ lives. The hon. Member for Worcester (Mr Walker) spoke of his casework, which mirrors mine. My advice surgeries are full of people suffering as a result of the housing crisis, and my inbox and telephone line are jammed with their cases. Rent costs are rising, and there are poor standards in the private rented sector. We have ever-increasing homelessness across the country, both in terms of statutory homeless and rough sleeping. The Government are seemingly committed to seeing the end of the social housing sector as we know it. Fewer homes are being built than at any time since the 1920s and we have a generation of young people priced out of the property market. For five years, the Government have had the chance to tackle this housing crisis head on, but they failed.
It has never been more important to tackle the housing crisis, because housing affects everything—it affects our whole lives. Insecure housing affects our whole society. It affects health, education and productivity. Without a secure roof over our heads, we face uncertainty, instability and doubt. Stable homes make stable communities, and without safe, stable and affordable housing we face pressure across our whole society and across our public services. It affects our schools and our children’s education, with unsettled classes affected by churn and individual children falling behind as they move school again and again. It affects public health and our doctors, who struggle to co-ordinate health awareness campaigns as a result of instability in the housing sector, as residents constantly move between practices. It affects our communities, where many are unable to set down roots, commit to a local area, and join local organisations, sports teams and religious groups. That point was made by my hon. Friend the Member for Westminster North (Ms Buck).
The Government claimed that they would build more affordable homes, but the “affordable rent” is not affordable to many people. House of Commons Library research shows that in London it would swallow up 84% of the earnings of a family on an average income and it requires a salary of up to £74,000. This does not just affect London; the contributions we heard from my hon. Friends the Members for Bristol South (Karin Smyth) and for Leeds East (Richard Burgon) showed us that this is a national crisis, not just a London one.
Many of those who cannot afford to buy have to live in the private rented sector, where the Government have failed to increase security and improve standards, and have overseen rents reaching an all-time high. Once the private rented sector was mainly for students and young professionals, but now it is families and the vulnerable who live in the sector. That was spoken about with concern and compassion by the hon. Member for Rossendale and Darwen (Jake Berry). Some 9 million people now rent privately. Almost half of those who rent are over 35. They want the same security and stability that they would have if they owned their home, but they face insecure assured shorthold tenancies, and a Government refusing to encourage long-term tenancies and to tackle rising up-front letting agent fees. While these people pay more, the Government are failing to act to improve standards in the sector. Although the majority of properties in the private rented sector are well maintained and of good quality, there are sadly too many landlords who let properties that are not fit for human habitation. Indeed, the Government’s own statistics say that 16% of private rented sector dwellings are failing the minimum safety standard. When my hon. Friend the Member for Westminster North introduced a private Member’s Bill to make sure that homes were fit for human habitation, it was talked out by Conservative Members, who argued that it would put a huge burden on landlords.
Teresa Pearce
I am afraid we are very short of time, so I cannot.
My hon. Friend the Member for Dulwich and West Norwood (Helen Hayes) also touched on the rising housing benefit bill, which is now £4.4 billion higher than in 2010. The Housing and Planning Bill included an all-out attack on social housing. On the last day of the Committee, the Government added a last-minute amendment to end secure tenancies for social tenants without any consultation or impact assessment.
I would like the Minister to respond to two questions. If home ownership is the only way forward, where are people who cannot get a mortgage meant to live? Can he confirm that starter homes will be for first-time buyers and will not be available to cash buyers?
The Housing and Planning Bill will lead to a loss of affordable homes to rent and buy, but more than anything it is a missed opportunity to tackle the housing crisis head on, to provide greater security, stability and safety to tenants in the private rented sector, to offer a genuine hand-up to those who are trying to get on the property ladder and to build more social housing. We have seen a comprehensive spending review and an autumn statement that have failed to provide for a programme of affordable house building and have attacked many tenants on low incomes due to cuts in housing benefits.
For five years the Conservatives have had the chance to tackle the housing crisis. They have failed. They have their own track record, and it is one of five years of failure. They should and will be judged on it.
The Parliamentary Under-Secretary of State for Communities and Local Government (Mr Marcus Jones)
I thank all Members for taking part in this lively debate. Before I respond to the speeches made by hon. Members, the House will appreciate a reminder of what has been achieved since 2010. Back then, the housing market was broken. We inherited a planning system that was dysfunctional, and levels of house building that were tumbling. The economy and public finances were on the brink of collapse. Enormous progress has been made since. Almost 900,000 new homes have been delivered in England since 2010. In the last Parliament the number of first-time buyers doubled, the number of new homes we built doubled and public support for new house building doubled, and since 2010 we have helped more than 270,000 households buy a home.
We have provided more than 270,000 affordable homes for rent, with almost one third of those in London. We are the first Government since the 1980s to finish their term with a larger stock of affordable homes. A reformed planning system gives far greater weight to the views and needs of local communities, but in this Parliament we want to go much further. The Government’s investment is being doubled to £20 billion in the next five years. It will support the largest housing programme by any Government since the 1970s. Our ambition is to deliver 1 million more homes and double the number of first-time buyers.
My hon. Friends the Members for South Norfolk (Mr Bacon), for Wimbledon (Stephen Hammond), for Worcester (Mr Walker), for Rossendale and Darwen (Jake Berry), for South Suffolk (James Cartlidge), for Thirsk and Malton (Kevin Hollinrake), for South Ribble (Seema Kennedy), for Croydon South (Chris Philp), for Dudley South (Mike Wood) and for Bexhill and Battle (Huw Merriman) all made fabulous and important contributions. My hon. Friend the Member for South Norfolk explained the importance of self-build and praised the measures in the Housing and Planning Bill to promote it. My hon. Friend the Member for Wimbledon pointed out that council house building is now at its highest level for 23 years, knocking down the myth promoted by the Labour party.
It was good to hear my hon. Friend the Member for Worcester point out that the Conservatives in local government, not Labour, are providing affordable houses in Worcester. I was also pleased to hear his welcome for our crackdown on rogue landlords. My hon. Friend the Member for Rossendale and Darwen stated the importance of first-time buyers and the Help to Buy ISA that the Government are introducing. My hon. Friend the Member for South Suffolk mentioned the measures that the Chancellor is taking to make things fairer for first-time buyers. My hon. Friend the Member for Thirsk and Malton made a great point about the importance of the additional housing that will be provided by the right-to-buy receipts, and my hon. Friends the Members for South Ribble and for Dudley South made encouraging comments about planning in principle on brownfield sites and the difference that it will make in their constituencies. My hon. Friend the Member for Croydon South mentioned the London Land Commission and the potential for public sector land to be brought forward for development. My hon. Friend the Member for Bexhill and Battle was a strong advocate of neighbourhood planning.
That brings me to the points made by Opposition Members. I shall start where my hon. Friend the Minister for Housing and Planning left off. He mentioned “Back to the Future” to describe Labour’s approach and he was right. Labour still has a past which it harks back to, but it has very little of a future to look forward to if today’s debate is anything to go by. Speaking from the Front Bench, the right hon. Member for Wentworth and Dearne (John Healey) and the hon. Member for Erith and Thamesmead (Teresa Pearce) spent 40 minutes in total on their opening and winding-up speeches, and did not put forward one idea for tackling one of the biggest issues facing the country. It was all soundbites, empty rhetoric and ideology rather than pragmatism to help people get into their own home. For some reason Opposition Members seem very happy to own homes themselves, but when it comes to other people having the chance to own their home, they do not seem to want it. We want people to have the opportunity to own their home, which 86% of people want.
There were eight speeches from Labour Back-Bench Members that were extremely consistent with those from their Front Bench. In those eight speeches not one idea was suggested to try to deal with the issues that the country faces. There was one notable exception. The hon. Member for Birmingham, Yardley (Jess Phillips) made several constructive comments and proposed a number of ideas that we will look at in the context of the debate.
Britain has come a long way over the past five years, a journey that has taken us from the brink of bankruptcy to being the fastest-growing advanced economy in the world. Confidence has returned and living standards are rising. More people are buying homes and house building is on the rise. But we must go further, and this Government are under no illusion about the scale of the progress that is required. In the past five years we have pulled house building up from the record lows of the previous decade, and in the next five years we intend to push it up further to levels not sustained since the 1980s. The challenges that we face today have been many decades in the making.
Our focus moves us from rescue to reform. We must address the deep structural weaknesses in the way that this country plans and builds for the future. A better housing market will be vital for raising the productivity of our country and rebalancing the economy. Above all, it will ensure that Britain is a country of opportunity, where everyone who works hard can realise their dream of home ownership—the housing association tenant, the young family who want to settle down, and the retired couple who want to build their own house. They all voted for a better housing market and that is what this Government are determined to deliver.
Question put.
Business without Debate
(8 years, 4 months ago)
Commons ChamberRead Full debate Read Hansard Text
Divorce proceedings of a UK citizen abroad
(8 years, 4 months ago)
Commons ChamberRead Full debate Read Hansard Text
Gavin Williamson (South Staffordshire) (Con)
My constituent Sian Mitchell moved to the United States last year, following her engagement and marriage to an American citizen. Sadly, shortly after the birth of her son earlier this year, her marriage fell apart. Her multi-millionaire husband, Mr Angus Mitchell, has taken out court orders preventing Sian from taking her child out of the State of California until proceedings have been resolved, making it as difficult as possible for her to bring up her son in the way she wishes. Sian is away from her family and relies on their emotional support during this extremely difficult time. She is desperate to return home to the United Kingdom with her child to allow her family to have the chance to meet this little boy for the first time. I therefore present the petition on behalf of 154 residents of South Staffordshire.
The petition states:
The petition of residents of the UK,
Declares that Mrs Sian Mitchell moved to the United States of America where she married a US citizen with whom she has a son; further that divorce proceedings are currently in motion and Mrs Mitchell has been ordered by the courts in California to remain in the State with her son until proceedings have been resolved; and further that the petitioners believe that the Foreign and Commonwealth Office and the Government should offer as much support and assistance to her as possible so she can return to the United Kingdom.
The petitioners therefore request that the House of Commons urges the Foreign and Commonwealth Office and the Government to make representations to the US Government and the State of California to press the issue and get a resolution to the problem at the earliest possible stage so that Mrs Mitchell can return to the United Kingdom with her son as soon as possible.
And the petitioners remain, etc.
[P001662]
Transgender Prisoners
(8 years, 4 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Cat Smith (Lancaster and Fleetwood) (Lab)
I am pleased to have secured my first Adjournment debate on the issue of transgender prisoners. It is not a topic that I knew much about before my election in May, but in my seven months in this House it has certainly gained my attention.
As someone who was interested in equalities issues before entering the House, I was keen to be elected to the Women and Equalities Committee. The Committee’s first inquiry into transgender equality is expected to be published early next year and we have taken evidence on trans people in the prison system. It was at that evidence session that I first became aware of the issue that is before us in this debate. It struck me that trans people face barriers and complications at pretty much every point in their lives, but there is a particular problem in our prison system. The description that was put to me last week was that
“getting involved in transgender issues is like a reverse onion, the more you look to peel off layers, the bigger it gets!”
Research suggests that trans people are over-represented in the criminal justice system. The proportion of trans people in the prison system may be twice the proportion in the general population. Many of the offences for which trans people are incarcerated apparently involve obtaining money for privately funded gender reassignment surgery. That is an insight into the lengths to which some trans people feel they have to go to live life in their acquired gender. Other possible reasons for the over-representation of trans people in the criminal justice system include the involvement of sections of the trans community in sex working and substance misuse. However, throughout my involvement in this issue, it has been a constant struggle to find any reliable data.
The recent cases, which have been much discussed in the media, have focused attention on the policies of the National Offender Management Service towards transgender prisoners in England and Wales.
Angela Crawley (Lanark and Hamilton East) (SNP)
I thank the hon. Lady for calling this important debate. As a former colleague on the Women and Equalities Committee, I know that she is a great champion of trans issues. The Scottish Prison Service has worked closely with the Scottish Transgender Alliance to produce guidance on gender identity and gender reassignment to ensure that prisoners are placed in the estate that reflects their gender identity, regardless of whether they have a gender recognition certificate. Will she join me in calling for the UK Government to follow the Scottish example?
Cat Smith
The hon. Lady has pre-empted the next part of my speech. There are huge differences in the placement of transgender prisoners between the Scottish prison estate and the English and Welsh prison estate. The policy guidelines for England and Wales state that prisoners should normally be located in the prison estate of their gender, as recognised by UK law. For transgender prisoners, that is normally decided by the gender stated on their gender recognition certificate. There is some flexibility to allow transgender prisoners who do not have a GRC to be located in the estate of their acquired gender, where a case conference and multidisciplinary risk assessment determine that it is appropriate.
Iain Stewart (Milton Keynes South) (Con)
I congratulate the hon. Lady on securing this important and sensitive debate. Joanne Latham was found hanged in her cell at HMP Woodhill in my constituency. She was at the very early stages of changing gender and, therefore, would probably not have been covered by the regulations. Does her case not highlight the need for a case conference to be convened at an earlier point in the person’s journey?
Cat Smith
The hon. Gentleman makes a pertinent point and highlights the difficulties. A great number of people who have transitioned gender do not have a gender recognition certificate, so this does not just affect those who are at the beginning of their transition. Many trans people do not seek a gender recognition certificate for a great number of reasons, including financial reasons such as access to pensions. That puts them at risk, were they to enter the prison estate in England and Wales, of not being assigned to the prison estate of their acquired gender.
I welcome the Government’s review of the policy guidelines for England and Wales. The scope of the review was broadened recently to ensure that the care and management of transgender prisoners are fit for purpose.
Rebecca Long Bailey (Salford and Eccles) (Lab)
There is a clear danger when trans people are placed in all-male prisons, as has been highlighted in this debate. In the light of that, does my hon. Friend agree that, as well as issuing the much-needed guidance, the Government should impose a legal responsibility on prison governors to ensure that there is safe housing for trans people, no matter what stage of the reassignment process they are at?
Jim Shannon (Strangford) (DUP)
I asked beforehand whether the hon. Lady would give way. Today in Northern Ireland it has been announced that a prisoner is alleging sexual abuse in Maghaberry prison. This is a devolved matter, I understand. He is taking action against the Prison Service. Does the hon. Lady feel that, while the Minister will answer for England, there is a need for legislation for human rights in prison for all prisoners across the whole of the United Kingdom of Great Britain and Northern Ireland?
Cat Smith
I believe it is clear that the whole of the UK has a responsibility to safeguard trans people in all walks of life and that no part of the UK has got this issue absolutely correct.
As I mentioned earlier, the guidelines state that the social gender in which the prisoner is living should be fully respected, regardless of whether they have a GRC. I would be interested to know whether the review will be comparing the experience of trans prisoners in Scotland with those of trans prisoners in the England and Wales model.
Evidence presented to the Women and Equalities Committee suggested that there are problems with the way trans people are treated when they appear in court—well before they enter custody, therefore—with discriminatory behaviour such as misnaming and mis-gendering. The Gender Identity Research and Education Society stated in evidence to the Committee:
“Trans people are frequently ‘outed’ in court situations to create, deliberately, a negative view of them, whether their trans history is relevant or not. The Gender Recognition Act s22(4)(e) has been misused to achieve this.”
It also appears that a lack of understanding of trans experiences can lead to assumption, bias, potential breaches of confidentiality and other issues in the process of writing pre-sentence reports, which is undertaken by members of the national probation service.
In response to my taking up of this issue in the House on several previous occasions, I have received contact from prisoners, both trans and cisgendered. I want to share with the House some of the accounts I have heard.
From my contact with a trans woman prisoner currently held in a men’s prison, I was alarmed to learn that as well as feeling insecure and being a victim of rape and sexual assault, she is being denied the ability to continue the healthcare and medical appointments that she is having as part of her transition. Prior to entering custody, she had privately arranged final stages of reconstruction surgery to further progress her transition, and the National Offender Management Service is refusing to allow her access to this surgery and to the hormonal medication she has been taking to assist the process.
It is difficult to express how difficult that is making her life, so I will quote from her letter to me:
“The Governor’s blocked all my medical letters to my surgeons, the prison have no right to strip me of my care/hormone treatment. This is killing me as I am now in reversal.”
For any Members who are unclear, reversing is someone transitioning from male to female potentially growing a beard, for instance, while living as a woman, which would be distressing for any prisoner, I suspect.
She is a very vulnerable prisoner, with recorded serious attempts of self-harm, and attempts at suicide. She began the transition process in 2008, and formalised her intention to remain living as a woman for the remainder of her lifetime in 2012, via the making of a “statutory declaration” under the Gender Recognition Act 2004. Yet she tells me:
“There is no knowledge of how suicidal I am because they don’t care what impact”
their
“choices have on me physically and psychologically. I’m totally destroyed, not the woman I was. I feel I will kill myself soon. I cannot do this now. Please will you help me?”
She has told me that during her time in custody in a male prison she was raped twice and sexually assaulted. She told me:
“I cannot take no more—I’m a woman in a male prison. This is not right.”
Despite being successful on 29 October at county court in obtaining a judgment in her favour that the Ministry of Justice has responsibility for providing access to private medication and treatment outside of prison, and that that is a decision for the prison governor following a multidisciplinary meeting, this is yet to be facilitated, even though she contacted his office on 10 December 2015. While she continues to be denied the right to surgery and to be moved to a female prison establishment, she remains extremely vulnerable and at a very high risk of harm. Examples of her self-harm have included injecting bleach into her testicles and attempting self-surgery to remove her scrotum.
I will now make my last quote from this prisoner’s letter to me:
“I hope you can help me and get me out of this hell of a prison that’s not fit for transgender people or cares for them.”
I can reassure the House that her constituency MP is taking her case very seriously and doing her best to assist this prisoner.
Interestingly, NOMS has agreed that when she is released from custody, it will support her continuing supervision in the community in a female “approved premises”. There is no consistency in this case, and her story seems typical of that of many trans prisoners. Journalist and LGBT campaigner Jane Fae told the BBC:
“My serious concern is this is blowing the lid off something that is going on—that for a very long time trans prisoners have not been treated well within the system, that the rules that exist are being overridden... And this is leading to a massive, massive amount of depression and potentially, in some cases, suicidal feelings.”
Jenny Chapman (Darlington) (Lab)
I am sorry to have to agree with my hon. Friend and to point out that, at the moment, once every four days, somebody takes their own life in our prisons.
Cat Smith
I thank my hon. Friend for sharing that upsetting statistic with the House.
In concluding, I will look for some optimism. Public opinion and awareness of this issue seem to be improving. BBC “Look North”, PinkNews, and many others have done a great job of holding the Government to account on it, as has The Huffington Post. It has launched the “TransBritain” campaign, which aims to raise awareness of transgender rights in Britain today. I urge the Minister to take a look at some of the work that it is doing.
My hon. Friend the shadow prisons Minister wrote to the Under-Secretary of State for Justice, the hon. Member for South West Bedfordshire (Andrew Selous) last week to welcome the announcement that his Department’s review into trans prisoners will now be widened to consider what improvements can be made across prisons, probation services and youth justice services.
Martin John Docherty (West Dunbartonshire) (SNP)
I am grateful to the hon. Lady for giving way because I am very conscious of the time. Reflecting what happens in Scotland might affect the debate, in terms of the additional access to care within a prison framework, such as access to items that may be necessary to relieve gender dysphoria and facilitate gender expression such as chest binders and prosthetics. That may add to what the hon. Lady is discussing.
Cat Smith
I thank the hon. Gentleman for that helpful intervention.
Will the Minister confirm exactly when she estimates that the review that I mentioned will conclude? In answer to my urgent question last month, and in response to my hon. Friend the Member for Ilford North (Wes Streeting), the prisons Minister confirmed that, although the Government do not currently hold data centrally on the number of transgender people in prisons, they will start publishing them in future, and that they plan to introduce a self-assessment declaration at pre-sentence report stage. Does the Minister have a timetable for the introduction of those measures? Could she let us know what steps the Government are taking while the review is under way to ensure that recent tragedies are not repeated?
I want to finish with a brief point about the prison estate in general. We know that the right conditions need to be in place to allow prisoners the space to rehabilitate themselves and play a role in society. The outgoing prisons inspector’s latest report revealed that our prisons are in the worst state for 10 years. Overcrowding is up. Violence, against staff and prisoners, has increased, and self-harm and suicides are also up.
My noble Friend Lord Falconer has warned:
“Violent, under-staffed prisons will never be able to rehabilitate prisoners, challenge re-offending behaviour or protect victims of crime.”
That is especially true for trans prisoners.
The Parliamentary Under-Secretary of State for Women and Equalities and Family Justice (Caroline Dinenage)
I congratulate the hon. Member for Lancaster and Fleetwood (Cat Smith) on securing the debate. She made some powerful and important observations in her speech, and I will be more than happy to look into any individual cases if she would be kind enough to forward them to me.
As the hon. Lady will understand, the care and management of transgender people in prison is not only a complex but a sensitive issue, which the Government and I take very seriously. As she knows, I hold not only a role in the Ministry of Justice, but the Women and Equalities portfolio. The subject therefore affects me in both roles.
We are committed to incorporating equality and diversity into everything we do and ensuring that we treat all offenders with decency and respect. Current policy and guidance on the care and management of prisoners who live or propose to live in a gender other than the one assigned at birth are set out in Prison Service Instruction 07/2011. The instruction states that all prisoners are normally placed according to their legally recognised gender. Legal gender is determined by the individual’s birth certificate or gender recognition certificate, if they have one. When someone has obtained a gender recognition certificate, they are entitled to a new birth certificate in their acquired gender. The guidelines allow some room for discretion, and senior prison staff will review the circumstances of each case in consultation with medical and other experts, in order to protect the physical and emotional wellbeing of the person concerned, along with the safety and wellbeing of other prisoners.
The prison estate, and the intervention and support it provides to all offenders, is highly complex. Offenders are more likely to suffer poor mental health, to have issues with substance misuse, or perhaps to have suffered domestic abuse or sexual violence than the general population. All those considerations must be taken into account when we decide on the most appropriate place for an offender to receive the right care and rehabilitation.
As the House will appreciate, the circumstances of individual transgender prisoners vary widely. It is therefore right that NOMS should take a case-by-case approach that is informed by advice from the relevant professionals. Under current arrangements, prisons must produce a management care plan that outlines how the individual will be managed safely and decently within the prison environment. That plan will have oversight from psychologists, healthcare professionals, and prison staff.
Where a lack of clarity about the most appropriate location for a prisoner is associated with their gender identity, the instruction states that a multi-agency case conference must be convened. That will determine the best way forward consistent with the policy, taking into account the individual’s protection and wellbeing, as well as that of other prisoners, and any other risk factors that are of paramount importance.
As the hon. Lady will know, we have received a number of representations that express concern that the current system may not sufficiently address the needs of transgender prisoners. As has already been announced, NOMS is undertaking a review of the relevant prison service instruction to ensure that it is fit for purpose. That must provide an appropriate balance between respecting the needs of the individual, and the responsibility to manage risk and safeguard the wellbeing of all prisoners.
Barry Gardiner (Brent North) (Lab)
In cases where the care management plan has obviously failed, what action has been taken against those responsible?
Caroline Dinenage
If the hon. Gentleman will bear with me I will come to that point soon, and I will be more than happy to communicate with him after the debate if I do not cover everything.
Last week I announced during Justice questions that that review will now be widened to consider what improvements we can make across prisons, probation services and youth justice services. The review will develop recommendations for revised guidelines that cover the future shape of prison and probation services for transgender prisoners and offenders in the community. It will be co-ordinated by a senior official from the Ministry of Justice, who will engage with relevant stakeholders—including from the trans community—to ensure that we provide staff in prisons and the probation service with the best possible guidance.
Angela Crawley
Has any consideration been given to those who identify as non-binary or non-gendered in that review and guidance?
Caroline Dinenage
The hon. Lady makes an excellent point. The terms of reference for the review have been published, and that refers back to the point made by the hon. Member for Lancaster and Fleetwood about the evidence learned from experience in Scotland. The review will ask for evidence and submissions in the new year, and we want that to be an open and engaging process. Everything and anything will be taken into consideration at that point.
We want to ensure that we provide staff in prisons and probation with the best possible guidance. NOMS, the Youth Justice Board, the national health service and the Government Equalities Office have already started to provide the professional and operational expertise necessary to get this right. In addition, Peter Dawson and Dr Jay Stewart will act as independent advisers to the review. Peter Dawson is deputy director of the Prison Reform Trust and has served as deputy governor of HMP Brixton and governor of HMP Downview and HMP High Down. Dr Jay Stewart is a director of Gendered Intelligence, an organisation that aims to increase the understanding of gender diversity.
An aspect of the review to which the Government have given a firm commitment is defining how we can properly record the number of transgender prisoners and offenders in the community. There are a number of sensitivities associated with this, of which the hon. Lady, who has served on the Select Committee, will be aware. The Gender Recognition Act 2004 places constraints on the recording of information about individuals who have applied for or been issued with a gender recognition certificate. Individual prisons are of course aware of those prisoners in their care who live or propose to live in the gender other than the one assigned at birth, in order properly to provide a care management plan for them that is consistent with the policy guidelines.
NOMS is currently looking at ways to facilitate the recording of information relating to transgender status through the introduction of an equality self-declaration form—to which the hon. Lady referred—to be completed by all defendants as part of their pre-sentence report. As well as obtaining other equality-related information, the use of such a form as standard would enable us to monitor the amount of self-declared transgender individuals who have received a custodial or community sentence. The resourcing and operational impact of introducing the form is being looked at right now, and I hope we will have more news on that shortly.
There has recently been considerable media interest in a number of individual cases, the reporting of which has, sadly, been rather wide of the mark in some parts. As the House will appreciate, operational issues relating to the effective management of risk and the protection of offenders mean that it would not be appropriate for me to comment on individual cases. A key issue is the privacy of individual offenders and their families. An individual’s history of offending constitutes “sensitive personal data” for the purpose of the Data Protection Act 1988, as can information on their possible transgender status. Such information can therefore be released only when it is fair and lawful to do so. The threshold is high and requires a strong countervailing public interest for the information to be disclosed. Factors relevant to that assessment will include whether the individual has given their consent for the information to be released.
In addition, under section 22 of the Gender Recognition Act 2004, it is a criminal offence for someone who has acquired information in an official capacity—including civil servants, holders of public office and employers—to disclose information about a person’s application for a gender recognition certificate or where the certificate has been issued that discloses the person’s previous gender.
Section 22 of the Gender Recognition Act also defines any information relating to a person’s application for a gender recognition certificate or to a successful applicant’s gender history as “protected information”. In most instances, it is a strict liability offence to disclose protected information to any other person if the information has been acquired in an official capacity. The exemptions to when it is an offence to disclose protected information listed in section 22 are very tightly drawn to avoid abuse and protect individual privacy. If the hon. Lady has examples of where that has not been upheld, I would be keen to know about it.
My hon. Friend the Member for Milton Keynes South (Iain Stewart) raised the death of his constituent. I have explained why there are limits to what I can say about individual cases. None the less, I wish to place it on public record that both myself in a personal capacity and the Government consider each self-inflicted death in custody a tragedy. We are committed to reducing the number of deaths in prisons, and every death is the subject of investigations by the police and the independent Prisons and Probation Ombudsman, as well as a coroner’s inquest. The safety and well-being of all prisoners in our care is of the highest priority.
I am mindful of the wide-ranging evidence put to the Women and Equalities Committee inquiry into transgender equality. It has taken some fascinating and really valuable evidence and I very much look forward to hearing its recommendations in due course.
I wish to reassure the hon. Lady of my utmost commitment to the care and management of transgender prisoners. The planned review will allow us the opportunity to focus on their needs and their well-being against the backdrop of social reform, and as part of our wider investment in the rehabilitation of all prisoners in our care.
I thank the hon. Lady for giving us the opportunity to debate this very important subject and look forward to discussing it further with her in due course.
Question put and agreed to.
Female Genital Mutilation
(8 years, 4 months ago)
General CommitteesRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Chair
Before we begin, I will briefly outline the procedure. First, a member of the European Scrutiny Committee may make a five-minute statement about the decision of that Committee to refer the document for debate. The Minister will then make a statement of no more than 10 minutes. Questions to the Minister will follow, and the total time for the statement and subsequent questions and answers is up to an hour. Once questions have ended, the Minister moves the motion. Debate takes place on that motion. We must conclude our proceedings by 5 pm.
Does a member of the European Scrutiny Committee wish to make a brief explanatory statement?
Alec Shelbrooke (Elmet and Rothwell) (Con)
It is a pleasure to serve under your chairmanship, Mr Evans. The World Health Organisation estimates that up to 140 million girls and women worldwide are affected by female genital mutilation. FGM is mostly carried out on girls up to the age of 15 and constitutes an extreme form of discrimination and gender-based violence. Although mainly concentrated in parts of Africa and the middle east, many women and girls living in the European Union have been subjected to, or are at risk of, FGM. Quantifying the number is difficult as there are significant gaps in the collection of the prevalence data that help us to understand the extent of FGM across the EU and who is most at risk. There is also relatively little comparative information to demonstrate which policy approaches and legal frameworks are best at changing attitudes towards FGM, protecting those at risk and prosecuting perpetrators. Although FGM can be prosecuted as a criminal offence in all EU member states, prosecutions are rare, if they happen at all.
The Commission communication before the Committee seeks to ensure that the EU’s internal and external policies pursue an integrated approach to the elimination of FGM. The Commission identifies a series of non-legislative actions to be taken forward at EU level that are intended to: gain a better understanding of the prevalence of FGM within the EU; promote sustainable change to prevent FGM; support more effective prosecution of FGM; provide protection for girls and women at risk of FGM; and contribute to global efforts to eliminate FGM.
The coalition Government supported the broad objectives and actions set out in the communication but questioned whether action at EU level was needed to achieve them. They suggested that the Commission should focus its efforts on three areas: monitoring the way in which member states have implemented relevant EU laws, such as on asylum, to protect women and girls at risk of FGM; providing funding to support national initiatives; and facilitating the exchange of information and best practice so that member states are better able to identify the most effective policy approaches and legal frameworks to prevent FGM and protect those at risk.
The Justice and Home Affairs Council agreed conclusions in June 2014 on:
“Preventing and combating all forms of violence against women and girls, including female genital mutilation.”
The Council called on member states and the Commission to: develop an effective multidisciplinary approach to eliminate FGM; collect and disseminate reliable and comparable data on the prevalence of FGM; promote appropriate professional training and ensure the availability of appropriate support services; implement effectively national laws prohibiting FGM; and provide clear guidelines at national level to ensure that women and girls at risk of FGM qualify for international protection.
The coalition Government considered that the conclusions were “appropriate and proportionate” and were consistent with the work they had undertaken at UK level on FGM. The focus now shifts to the more difficult task of implementation. It is clear that much work needs to be done to raise awareness of FGM, to change attitudes and to work towards a culture in which FGM is regarded by all communities as an unacceptable violation of human rights and human dignity. Today’s debate is a recognition of the importance that Parliament attaches to this issue. Although we all share the common objective of eliminating FGM, we must also be clear-headed about how we can best achieve that goal. In recommending the Commission communication for debate, the European Scrutiny Committee made it clear that an important consideration would be determining the respective roles of the Commission and member states in working towards the elimination of FGM and ensuring that any action taken at EU level genuinely adds value to, and does not undermine or contradict, efforts at national level.
I trust the Minister will be able to explain what actions have been taken at EU level since the communication was published in 2013 and provide some indication of the impact and added value. In particular, does she consider that we now have a better understanding of the prevalence of FGM across the EU? What have we learned from the experiences of other member states in tackling FGM, especially from those where there is a high prosecution and conviction rate? I would also welcome further information on the progress made in implementing the Council’s conclusions and the Minister’s assessment of how effective that has been in developing a coherent, EU-wide approach to tackling FGM.
The Chair
Before I call the Minister, I would like to remind the Committee that no interventions are allowed during the Minister’s statement.
The Parliamentary Under-Secretary of State for the Home Department (Karen Bradley)
It is pleasure to serve under your chairmanship, Mr Evans. I am also grateful to my hon. Friend the Member for Elmet and Rothwell for his introduction to the debate on behalf of the European Scrutiny Committee, of which he is a member.
Let me be absolutely clear, FGM is a serious crime. It is child abuse and the Government are determined to stop it, as are my counterparts in the European Union. The Commission’s communication of 2 December 2013 set out a range of actions to be undertaken at EU level towards ending FGM. As stated in the explanatory memorandum from the then Minister for Crime Prevention, the previous Government broadly supported the recommendations in the communication. The Government agreed that action needed to be taken to eradicate FGM in member states to which practising communities have migrated.
Without complacency, the Government felt that, while there were some areas where the EU can add value—for example, facilitating the sharing of information and best practice on tackling FGM—the UK was already undertaking a significant amount of work domestically to achieve the same outcomes. This remains our view. The actions undertaken by the Commission under the communication have been appropriate and proportionate in that regard and have respected member state competences.
I will now provide the Committee with an overview of the implementation of those actions in both the EU and the UK. First, to develop a better understanding of FGM in the EU, the Commission has funded the development of methodologies to estimate the prevalence of FGM and the number of girls at risk. Secondly, to promote multi-agency working, the Commission is funding a number of awareness-raising activities, including national campaigns in the UK, France and Malta, and an online training tool for professionals. Thirdly, to support member states in prosecuting FGM more effectively, the Commission will publish an analysis of relevant criminal laws and court cases early next year. Fourthly, the Commission has recast the asylum procedures directive and the reception conditions directive. That places an obligation on those member states that have opted in to set standards for the qualification and reception of applicants for international protection.
Finally, the Commission has actively participated in international co-operation to promote the elimination of FGM, including making pledges at the girl summit, hosted by the Prime Minister and UNICEF last year and providing €7 million for projects working to end FGM in countries such as Egypt and Senegal.
As the Committee will be aware, the UK has undertaken a significant amount of work towards ending FGM. On 22 July this year, we marked the first anniversary of the girl summit, and all the commitments made at the 2014 summit have now been delivered. In July, Ministers signed a cross-Government declaration reaffirming our commitment to tackling FGM and child, early, and forced marriage.
During the previous Parliament we introduced a number of measures via the Serious Crime Act 2015 to strengthen the law on FGM, and those new measures include: FGM protection orders, which came into force in July this year and are already being used to protect girls at risk of FGM; a new offence of failing to protect girls at risk of FGM; life-long anonymity for victims of FGM; and the introduction of a new mandatory reporting duty that requires specified professionals to report known cases of FGM in under-18s to the police. That duty commenced on 31 October and we believe it will help to give professionals the confidence to confront FGM.
As the Committee will be aware, to date there has not been a successful prosecution for FGM, and one of the challenges cited by police is the lack of referrals. This new duty can support prosecutions where FGM has taken place and, in turn, deter perpetrators, which will ultimately, prevent this appalling crime from happening in the first place.
Clearly, legislation alone is not going to end FGM. It is a complex issue which demands a co-ordinated response from a range of professionals. We have worked to ensure that they are equipped with the resources they need to tackle FGM effectively. That work includes part-funding an independent study into the prevalence of FGM in England and Wales and publishing the first ever NHS statistics about patients with FGM; publishing multi-agency practice guidelines, which we are updating and making statutory; and establishing a dedicated FGM unit, based at the Home Office, which is providing outreach support to professionals and local communities. In addition, to improve the healthcare response, the Department of Health has funded a £3 million FGM prevention programme.
To support the social care response, the Department for Education has provided £2 million in funding for an FGM project that is creating a specialised team of skilled social workers. In March, the College of Policing published new authorised professional practices on FGM to raise awareness among investigators and better equip them to tackle the practice.
Ultimately, however, we will not stop FGM unless we change attitudes. That is why the Government ran a national communications campaign, with funding from the EU, to raise awareness last year. We also funded 29 community engagement projects, including a network of community champions who are reaching thousands of women and girls affected by FGM and, importantly, their families.
The UK has not opted into the recast asylum procedures and reception condition directives. Nevertheless, we do provide protection where it is needed. Importantly, our asylum system is gender sensitive and fully considers any risks relating to gender-based persecution, including the risk of FGM.
We recognise the importance of sharing information and best practice across countries and are fully committed to playing our part in that. That is why the Department for International Development is continuing with the implementation of its £35 million programme to support the Africa-led movement to end FGM. Recognising that this is an area where the EU can add value, we have actively participated in a number of international exchanges, including holding the girl summit that I mentioned earlier and hosting a European learning forum on FGM earlier this year.
In conclusion, I welcome the opportunity to debate the Commission’s communication and look forward to questions on it from hon. Members.
The Chair
We will now move to the questions session. The Minister started speaking at 2.35 pm; we have one hour from then, so I will bring proceedings to a close at 3.35 pm if they have not concluded earlier.
Sarah Champion (Rotherham) (Lab)
It is a pleasure to serve under your chairmanship, Mr Evans. I would like to put on the record how impressive the Government have been with their zero-tolerance approach to female genital mutilation. I particularly thank the Minister, who has done everything she can to ensure that legislation and guidance are put into practice to prevent the crime.
Does the Minister recognise, however, that the figures in the EU document are actually outdated? Will she outline how she is updating the EU with UK-wide figures? Will she also comment on the provision of specialist FGM training for those in child protection roles? She mentioned the mandatory reporting, the guidelines and the specialists, but I am thinking about people who are on the frontline, such as social workers, health workers and teachers. What training provision is there for them? Will the Government consider conducting a review of FGM protection orders to determine if they are actually meeting their objectives?
The Chair
I will allow supplementary questions at my discretion. I know that this is the first Committee for a number of Members, so I will be hugely tolerant.
Karen Bradley
The hon. Lady is also champion of the FGM issue. I thank her for her support and for her work as a member of the Serious Crime Bill Committee, in which we debated so many of these issues. She is right to highlight the point about figures, because one of the problems we have is identifying the prevalence of FGM. It is very much a hidden crime. We are only just touching on accurate evidence and information about the prevalence of FGM. Estimates are made but we need to know exactly what the position is.
The work that we have been doing with the NHS and the work that the Department of Health has been doing to ensure that we understand the prevalence of FGM across the NHS is incredibly important, as is the mandatory reporting. At the moment, I do not have the updated figures but, with mandatory reporting coming in, we are very confident that that will give us a much better estimate of the number of women and girls who have been affected by FGM in the UK. It is only by understanding the prevalence and the size of the problem that we can begin to tackle it and get into the communities to make sure that they understand what it is that we are trying to do, which is to show that this practice is totally and utterly unacceptable.
The hon. Lady asked about specialist training on FGM and I talked in my statement about the work that the Department for Education is doing to make sure that there is outreach to people, to the communities that may be affected. That includes training, of course, for those professionals who will come into contact with individuals, but there is always more that can be done and I am in no way complacent about this. We need to make sure that there is thorough awareness of this problem, that people do not feel frightened of confronting it and that they know they have the support of the Government and the public in confronting this issue.
The hon. Lady also asked about a review of FGM protection orders. We do not yet have the figures for the number of FGM protection orders—that information will be coming out shortly. Clearly, the Government look at these things constantly to make sure that they are working, they are appropriate and they are delivering what we want, which is to stop this crime happening in the first place.
Kelvin Hopkins (Luton North) (Lab)
I do not mince words on this. It is absolutely barbaric and incredibly cruel—we ought to say that loudly and many times so that people who indulge in this practice get the message. The figures may well be out of date but there was a table on page 10 of the document that shows—an estimate obviously—that for the number of women with FGM, of the 11 EU countries listed, Britain is the highest. For the number of girls at risk of FGM, Britain is again the highest but so far, according to this table, there have been no prosecutions at all. We are talking about tens of thousands, and possibly many more than that. Can the Minister explain why we have not had any prosecutions, or none up to that date anyway?
Karen Bradley
I know that the hon. Gentleman takes a particular interest in this issue. He is quite right, it is barbaric and cruel. It is child abuse. There is no way in which it can be excused or tolerated. He asked about prosecutions and pointed out the figures showing the UK to have the estimated highest prevalence of FGM in the EU. The problem with prosecutions is that this is such a hidden crime that victims have not wanted to come forward and that, often, a prosecution would involve a victim giving evidence, perhaps against their closest family members. Although the practice of FGM was originally made a criminal offence in 1985, there was not a single referral to the CPS until 2010. Referrals are now coming through. There was a prosecution that unfortunately did not result in a conviction earlier this year, but it did at least establish many of the issues that had been of concern; for example, whether infibulation or reinfibulation was part of the offence. It was quite clear from that case that they are part of the criminal offence.
I know that the CPS is looking to make sure that we can have a prosecution with a successful conviction. I think that is what we all want to see—that successful conviction. By introducing life-long anonymity for victims so that they can come forward to give evidence and know that this will not be exposed in public, by introducing mandatory reporting and by introducing, for example, the failure to protect a girl at risk of FGM as a criminal offence, I am confident that we are doing the right things to give law enforcement and the prosecution services the tools they need to get that prosecution that we all so desperately want to see.
Kelvin Hopkins
Although the prosecution rate is still low, France has had 29 prosecutions. We have had none. Obviously France is doing something that we are not doing—is there anything we can learn from France?
Karen Bradley
The hon. Gentleman will know that France has a different legal system and a different evidence threshold but, absolutely, we can always learn more. We need to learn what it is in France that has given those victims the confidence to come forward and has enabled the prosecuting authorities to get the evidence they need. We believe that the measures that we have taken following the girl summit go a long way to doing that—we now need to see that prosecution. If we do nothing else today, I want to make it clear, on the record, that this Committee and this House urge law enforcement and prosecuting authorities to take this seriously and to get that prosecution.
Kelvin Hopkins
Obviously I support and applaud what the Minister has said. Is there a confidential helpline where a family member could say, “My sister is at risk”, or something of that kind? Many young women have adjusted to a more western way of life and would want to prevent terrible things from happening, especially if it has happened to them. Is there a confidential helpline?
Karen Bradley
There are a number of confidential helplines and apps. I was at the launch of one app earlier this year. It provides a confidential way for people to submit their concerns to an independent, non-Government body that can help and support them. However, we need to do more, and mandatory reporting is incredibly important. I know that some professionals have had concerns about taking on that burden, but if a healthcare professional saw a patient who had been the victim of another crime, we would expect them to report it. In the same way, they should report FGM, which is clearly a horrendous crime.
The National Society for the Prevention of Cruelty to Children also runs a confidential helpline for victims and professionals, so there are places that people can go. I would be very happy to write to members of the Committee with details of those helplines if they want to share them with their constituents.
Kelvin Hopkins
I have one more question, about girls being taken out of school for significant periods. Is there some reporting method for that? It is partly to do with forced marriage, but in certain communities, mainly from Africa and the middle east, girls are taken out of school for significant periods of time, either being taken abroad to have the FGM done there or even having it done within Britain and not being well enough to go back to school.
Karen Bradley
Again, the hon. Gentleman makes a very important point. The reason why we introduced protection orders at the beginning of the school holidays was that we know that is a time when girls can be taken out of the UK to be cut. The families know that the girls will come back to a new class, and possibly even a new school if they are moving from primary to secondary school.
The hon. Gentleman is right that girls leaving school for a significant period of time can be an indicator of FGM, and I know that there is multi-agency working across the country to look carefully at that. Reports can be made to multi-agency safeguarding hubs and, of course, to the NHS helpline. We have also published multi-agency guidance, which, as I have said, we are putting on a statutory footing. That includes information for schools and teachers on what to look out for.
Naz Shah (Bradford West) (Lab)
Do we know how many protection orders have been used for FGM so far, or even in the last year?
Karen Bradley
We do not yet have the final figures. Protection orders were only introduced on 17 July, so the first set of statistics has not yet come through. We hope to have them shortly, and I am sure the hon. Lady will be made aware of them when they are released.
Sarah Champion
Taking the Minister back to her answer about telephone helplines and reporting, I know that the advice on hate crimes is to call 111, but 111 does not have a translation service. Will the Minister tell Committee members, when she reports back to us, whether people are able to report in languages other than English?
Karen Bradley
I would be happy to report back to the Committee on that when I write with all the information on the helplines and the other help that is available, including from the FGM unit at the Home Office. We also have a forced marriage unit, which is a joint Home Office and Foreign Office unit working across communities to provide outreach education about forced marriage. It also works across borders with countries where we believe people may be being taken to be put into a forced marriage. I will be very happy to share all that information when I write to the Committee.
Motion made, and Question proposed,
That the Committee takes note of European Union Document No. 17228/13, a Commission Communication: Towards the elimination of female genital mutilation.—(Karen Bradley.)
Sarah Champion
Thank you for calling me, Mr Evans; you are being very tolerant with a novice, and I appreciate it.
I think the whole Committee agrees that female genital mutilation is a fundamental attack on the human rights of women and girls. It has been recognised as such by the United Nations General Assembly and stands in direct violation of the convention on the elimination of all forms of discrimination against women and the convention on the rights of the child. Women and girls subjected to FGM suffer lifelong medical and psychological damage. The procedure can lead to gangrene, septicaemia and tetanus. Long-term complications include enduring pain, severe complications during pregnancy and childbirth, higher infant mortality, stillbirth and death in childbirth. In psychological terms, women who have undergone FGM have been found to suffer from a wide range of conditions, including anxiety, depression and post-traumatic stress disorder.
The elimination of FGM has, rightly, been a key goal of human rights organisations, the United Nations and national Governments for many years. Progress has undoubtedly been made, but FGM remains widespread. As many as 133 million women are thought to be living with FGM across the world. In Somalia, up to 98% of women and girls between the ages of 15 and 49 are thought to have undergone FGM. In four other countries, the prevalence of FGM is thought to be higher than 90%.
We must remember that FGM is not simply an African problem. In Europe, it is estimated that 500,000 women have undergone FGM, and that 180,000 girls are at risk every year. The figures for the UK cited in the communication were collated in 2007, and according to revised figures from 2014, as many as 137,000 women in the UK are estimated to have undergone FGM. The NSPCC has estimated that as many as 23,000 girls under the age of 15 could be at risk. We must therefore ensure that the UK plays a full part in bringing this barbaric practice to an end and continues to promote the elimination of FGM across the globe.
FGM is, in many countries, a deep-rooted cultural practice. Simply encouraging Governments to outlaw it will do little to address the problem. FGM is already illegal in many of the states where it is most widespread, but it remains endemic. We should of course continue to push for Governments to prohibit FGM and punish offenders, but we must energetically promote cultural change. UK Aid and the Department for International Development have done really good work on the subject, and initiatives such as “The Girl Generation”, an Africa-led project to tackle FGM, are positive steps, but eliminating FGM will take time, and the Government must continue their commitment of resources and expertise.
The work of the European Union towards ending FGM is vital. It remains an international issue that cannot be managed by the UK alone. The framework provided by the EU is valuable in co-ordinating and amplifying our efforts. The UK must work closely with our European partners to ensure that the prevention of FGM, the identification of those at risk and the services for those living with FGM are strong across the EU. We must also utilise the EU’s global influence to promote action to challenge the cultural norms and attitudes at the root of FGM.
FGM has been explicitly illegal in the UK since 2004. There have been no successful prosecutions for FGM in the UK, which highlights the lack of awareness of FGM across our services. Positive steps to promote awareness have been taken in recent years, and it is vital that we ensure that practitioners can identify women and girls who may have been subject to, or who may be at risk of, FGM and report that to the authorities.
The introduction of FGM prevention orders in the Serious Crime Act 2015 was a welcome development. They provide a legal avenue to protect girls who are at risk of FGM, but we must ensure that they are effective. The Government should consider, as I have asked them to do in parliamentary questions, undertaking a review to determine whether they are meeting their objective. Victims of FGM, like those of any other form of abuse, are often reluctant to come forward or engage with support services. Health, immigration, child protection and immigration services are all likely to come into contact with those who are at risk. Multidisciplinary co-operation, better understanding and training are essential to protect girls who are at risk.
Education on FGM must be embedded as an integral element in curricula for professions in which practitioners are likely to come into contact with affected women and girls. Guidelines and procedures must be in place across the services to make certain that FGM, and those at risk, are identified and appropriate steps taken. Where FGM is identified, services must be able to provide support for its wide range of physical and psychological consequences.
The communication from the EU identifies a lack of holistic support services across the EU, including in the UK. The needs of survivors of FGM will vary dramatically, and we must therefore ensure that there is a focus not only on gynaecological services but on psychological support and post-traumatic counselling. Services should also share best practice across countries. In many cases, with cultural practices such as FGM, the messenger can be even more important than the message. We must therefore continue to engage proactively with minority communities, particularly those at risk of FGM. Without such engagement, the message that FGM is illegal and abusive will not be heard. Initiatives such as that recently undertaken by the Muslim Council of Britain, which issued explicit guidance to council members condemning the practice of FGM, are crucial and to be welcomed.
The Government should continue to work closely with community groups, third sector organisations and faith leaders to ensure that the message is heard loud and clear. We should also ensure that resources are allocated specifically to African-led organisations, as those might be the most effective at communicating the message about female genital mutilation.
Continued commitment to tackling FGM is vital if we are to ensure that all women and girls are safe from abuse. Many significant advances have been made in the fight against FGM in recent years, but we must not allow our focus to be diverted. FGM remains a widespread and, by some estimates, growing problem. I therefore welcome the EU communication and encourage the Government to engage closely with its recommendations and conclusions.
Kelvin Hopkins
It is a pleasure to serve under your chairmanship, Mr Evans.
The fact that we have had no prosecutions for FGM gives the impression that we are approaching it on a softly, softly basis, which is not right. I applaud my hon. Friend the Member for Rotherham for her words, but we have to take it much more seriously. Until we start getting prosecutions and punitive measures for those who commit these terrible acts, we are not going to make inroads. People believe they can get away with it because nothing is going to happen to them. When they think something will happen to them, they might start to take it seriously.
FGM is not a matter only for the Muslim community in general; it is associated with particular parts of the world, and there are many non-Muslim communities in Africa that practise it as well. It is right that it should be looked at in cultural terms. A news programme recently showed an interesting documentary from Kenya, where a man campaigning against FGM spoke to male tribal leaders. Although most of the operations are apparently carried out by women, men need to think about these things as well. He was making inroads and people were starting to accept that the practice was no longer acceptable in a modern civilised society. It was an impressive news item.
When things are happening that are not right, people have to be shamed. Beating up women is appalling and people have to be shamed about that. We have to think of a world in which that sort of thing does not happen at all. That is the sort of world that I want to live in and move towards. While these things go on we have to say over and again that they are barbaric, cruel and completely unacceptable in a world in which we believe—and many do—that men and women should be absolutely equal. Nobody should be oppressed because they are a woman, or indeed a man, although most of the time it is women who are oppressed.
We have to take this much more seriously than we have done so far. The practice has been illegal for more than 30 years, yet no prosecution has taken place, even though tens of thousands of women and girls have suffered. That says that we are not taking it seriously, and that we will not be until we get a number of prosecutions, with people sent to prison for doing this terrible thing. Someone who was caught torturing a person with a knife would be sent to prison. This practice should be taken that seriously.
When I first heard about FGM 20 or 30 years ago, I did not believe what I was hearing. I could not believe that sort of thing could be going on, but it clearly is and we have to be much more forceful in how we deal with it. I like to think that the message will get through to Ministers and to the legal profession that it has to be prosecuted much more effectively.
When it comes to evidence, it has been said that many girls and women have lifelong medical problems—both psychological and physical—as a result, so evidence that girls have had this done must come to medical practitioners fairly frequently. There must be ways of getting that evidence into the legal system, and perhaps persuading girls and women that it is time to speak up. Anonymity is of course crucial, because intimidation can take place. Nevertheless, we need to help women and girls to deal with this so that it does not happen to their daughters, their sisters or to future generations.
I know that I am a man, and perhaps I should not be speaking in this debate because it is about an issue that affects women, but I think that men’s attitudes have to be changed as well. We must not turn a blind eye to this. We must take it very seriously indeed. We need to see serious prosecutions, and people who commit these appalling acts should be sent to prison.
Angela Crawley (Lanark and Hamilton East) (SNP)
It is a pleasure to serve under your chairmanship, Mr Evans. This is the first such Committee that I have sat on, so please bear with me. It is a pleasure to follow the hon. Member for Rotherham and the hon. Member for Luton North. The hon. Member for Rotherham has worked vociferously for an agreement on tackling FGM, and it was great to hear a male Member passionately making the case against FGM. That is absolutely vital.
In London in 2013 two arrests were reported over the genital mutilation of a five or six-week-old baby girl—the youngest case reported. The two people arrested lived in Britain. The practice is not only abhorrent and immoral, but illegal, yet no one was convicted for the harm done to that child due to a lack of firm evidence. This case exposes how such harmful practice can slip through the nets of justice. FGM has been illegal in the UK for 30 years, and since 2003 anyone taking a child out of the UK to be cut faces 14 years in prison.
However, for both pieces of legislation there is yet to be a single conviction, as we have heard today. We are thus faced with the problem common to gender-based violence: a disconnect between the default political response of creating legislation to correct a problem and the practical steps needed to change the culture surrounding that problem. I therefore welcome the comments that have been made about legislation not being the only way to tackle this problem.
Every year, millions of women and girls worldwide have their quality of life drastically altered by FGM. More than 125 million women and girls are affected today, predominantly in pockets of the middle east, across central Africa and in south Asia. New research by City University London and Equality Now found that cases of FGM are on the rise in the UK. Between July and September last year health professionals uncovered 1,385 new cases of FGM, with 17 of those involving girls under the age of 18. Over half of the new cases recorded were in London, with women of Somali origin found to be the most likely to be affected. This is not a small-scale problem. The FGM programme manager at Equality Now, Mary Wandia, said that the figures shown are
“only the tip of the iceberg”.
She also said:
“Cases of FGM are likely to exist in every single local authority in England and Wales”.
I am sure that cases also exist throughout much of Scotland and other parts of the UK.
Even after 30 years of illegality, there is still a lack of medical and psychological support available to survivors. What we see is therefore a culture of woeful ignorance on the part of lawmakers, although I am not sure that is the case when I listen to hon. Members in this room. However, we know that this practice is going on, and we have to acknowledge it with legislation and with action. As the figures continue to increase, however, it is fair to say that further action is needed.
An international day of zero tolerance of FGM was held on 6 February 2014. The Government made it clear that no one in the UK was exempt from UK law. The Home Office was awarded £250,000 of funding from the European Commission to promote the national NSPCC FGM helpline, and to provide training for front-line professionals and support community engagement activity on ending FGM. Those measures go some way towards changing attitudes and beliefs among the relevant communities, towards making practitioners aware that what they are doing is wrong, and towards making sure that women realise that FGM is in fact a crime. The underlying causes of FGM include a mix of cultural, religious and social factors within families and communities—factors that are not wholly contrary to UK law and culture but that amount to a serious violation of human rights.
We recognise that FGM has a drastic impact on a woman’s body. As a deep-rooted social norm, it relates to the social culture of women’s sexuality and is practised in the belief that it is beneficial for a girl and that it preserves cultural identity in the context of migration. What must be addressed first and foremost is that any perceived benefits are massively outweighed by the horror and trauma for the victim, severe pain and bleeding, difficulty in passing urine, infections and death due to haemorrhage or neurogenic shock. The practice often leaves girls with long-term scars, post-traumatic stress disorder, chronic pain, HIV infection, cysts, abscesses and genital ulcers. There are increased risks of complications affecting the menstrual cycle, sometimes resulting in infertility.
Contrary to both the 1985 and 2003 legislation, UK-born girls are being taken abroad for what is culturally known as the “cutting season” of the summer holidays, but girls are being cut here, too. On the elimination of FGM, there is a positive trend towards abandoning the practice in the 28 countries that are most affected. Worldwide, 42 countries have passed laws condemning FGM, most recently Nigeria, which banned FGM in May 2015. Yet, according to the Foundation for Women’s Health Research and Development—FORWARD—in countries such as Sudan, Somalia and Egypt, up to 98% of females have been mutilated.
Research by the Scottish Refugee Council shows that in 2011 there were 23,979 people—men, women and children combined—in Scotland who had been born in one of the 29 countries identified by UNICEF as FGM practising countries. The largest community in Scotland potentially affected by FGM is the Nigerian community; that group amounts to 9,458 people. The number of people now living in Scotland who have been exposed to this culture presents a significantly increased challenge in addressing FGM. Since 2001, Scotland’s African population has doubled from 22,049 to 46,742, and in that time the cost of air travel to Africa has increased. Combined, according to Glasgow-based charity Roshni, those factors have led to an increase in the number of FGM incidents taking place on Scottish soil.
FGM is considered an outside issue, according to Dignity Alert & Research Forum in Edinburgh, but it is not; it is happening here in the UK, and it is very common. The public perception, however, is that it is not. Rather, it is very difficult for women to speak out about their experiences. In Scotland, after recent hospital figures revealed that more than 2,500 FGM victims had given birth in Scottish hospitals, politicians commissioned a Scotland-wide survey into its prevalence. The survey resulted in £222,000 being invested in a range of interventions, with priority areas including community engagement, development projects, awareness raising, training and support services. I raise that point not to preach but simply to share best practice.
Police Scotland officers based in Scottish airports have provided information on FGM to passengers, airline staff and airport workers since July 2015. As mentioned earlier, the school holidays are a prevalent time for FGM. The campaign’s timing was important, and it also included advertising against FGM in airport buildings. Last year, 19 incidents of FGM were reported to Police Scotland, up from 16 the previous year, which is evidence that this form of advertising is working.
The legal consequences of involvement in FGM are heavy. Long sentences act as a deterrent in both pieces of legislation. However, legislation alone does not work as a be-all and end-all solution. We must continue to spread awareness of FGM and not lose sight of the fact that it is a massive breach of women’s human rights. The advertising and educational initiatives of the Home Office and the Scottish Government have gone some way towards halting the spread of FGM. We must now break down the taboos of FGM in the most affected communities, if we are to eradicate this horrible practice in the UK. I welcome a co-ordinated response; together we will go some way towards stopping FGM globally.
Victoria Borwick (Kensington) (Con)
I welcome all the comments that have been made and the positive way in which we are tackling this subject. Kensington has a high proportion of the Somali community and is one of the test areas in London where different trials are taking place on how to break down the barriers.
I welcome the Minister’s comments about looking at other ways of working together. Sadly, as those of us who have worked in this area know, if a mother has been cut it is quite likely that her children will be cut. We have the problem, as other Members have identified, that although FGM is picked up in the NHS, as a result of all the various regulations we have, quite rightly, on safeguarding people’s data, the information does not always reach the other agencies that can then follow through. When an older sister is cut and it comes to the attention of the school, there does not seem to be a system for getting the younger sister protected. Those are small initiatives.
The Committee’s aim is to eliminate FGM. Of course we should start getting prosecutions, but we also need to get underneath to the underlying communities. I welcome the comments from the hon. Member for Luton North about the cultural importance of getting men on side in the debate and changing the culture so that FGM is not an expectation. Whether we believe in God or not, we are born as we are born and it is not necessary to be cut of mutilated. That is the basis on which one should work with faith groups and community groups in order to get the message over.
I welcome the Minister’s approach in looking at a more collegiate way of working together across all the agencies and getting the NHS to feel confident about sharing data with schools and vice versa, rather than constantly being hung up about the Data Protection Act. If we can find a more positive way through the various things that stop us talking to each other, the sooner this terrible practice will be eliminated.
Karen Bradley
I thank all Members of the Committee for their contributions. I will make a few points in response to the debate before concluding.
I am not sure whether the Committee is aware that my noble Friend Baroness Verma has been appointed Government champion on international violence against women and girls, a role she fulfils in her capacity as an International Development Minister. I met her earlier today to discuss how we can work together to try to get the cultural changes that so many Members have talked about and to get that working internationally.
The hon. Member for Rotherham and others talked about cultural change, and they are absolutely right. This is not a problem we can tackle only through legislation, as the hon. Member for Lanark and Hamilton East said. There has to be cultural change.
The hon. Member for Luton North suggested that we were somehow going soft on the issue. I assure him that is simply not the case. There is no doubt in my mind or that of the law enforcement and prosecution services that nobody should think they can get away with this—absolutely not. That is why we made changes through the Serious Crime Act, beefing up the legislation and making it easier for victims to feel they can come forward, with lifelong anonymity and with the additional protection orders and other measures we have put in place.
The hon. Gentleman is right to say that we want to see a prosecution, but we have to remember that in a court of law in England and Wales, we are talking about a situation where a jury has to be convinced beyond reasonable doubt, and that can mean witnesses giving evidence against their own family members—an incredibly difficult situation. That is why we need to do everything we can to protect those witnesses and victims so that we can get the prosecutions.
Kelvin Hopkins
I do not doubt the Minister’s sincerity or the concern of the Government and Members of all persuasions, but the reality is that there has not been a prosecution in all this time. People in the communities involved come from countries that are much rougher and tougher than ours, and they think, “They’re not going to pursue us, because there have been no prosecutions.” The reality is that, however we try to approach it in a sensible, law-abiding, modern way, people in those communities really think that they can get away with it.
Karen Bradley
I must correct the hon. Gentleman: there has been a prosecution; it just did not lead to a successful conviction. If we look back at that situation, the reason the prosecution was brought in the first place was that this was not a family member, but a doctor who reinfibulated a woman who had just given birth; and one of the problems with that prosecution was that the victim was called as a witness for the defence. That shows the difficulty we have with this situation. We are talking about very complicated, personal situations that involve family members. I commend the Crown Prosecution Service for bringing the prosecution, but it was always going to be very difficult to get a conviction.
Mr David Burrowes (Enfield, Southgate) (Con)
How do our current legislation and protection orders compare to provisions in other countries in terms of the level of attention given to ensuring that we get the prosecutions that victims deserve?
Karen Bradley
I will be happy to write to my hon. Friend with an analysis of the comparisons because we probably do not have time to go through it now. Let me be clear: the protection orders are for girls that we consider to be at risk of FGM, to protect them and stop them from being taken out of the country—for example, their passports are removed. That is girls who are at risk of FGM. We have also taken measures for girls where FGM has been committed. To return to mandatory reporting, that has been in force only since 31 October, but it means that any professional in a public body who comes into contact with FGM—to be clear: a health professional who sees that FGM has been committed and who knows it has been committed—has a mandatory duty to report it so that we get the information.
Naz Shah
I am going to speak about my experience of honour-based forced marriages and the case of Shafilea Ahmed. In that case we did not have a body, but we prosecuted. What I am struggling to understand is why, when we have got the evidence base—when we have clear medical evidence of mutilation—we need witness testimony. Why are we not prosecuting?
Karen Bradley
I cannot answer for why the CPS would choose to take a prosecution or not. I repeat that no cases were referred to the CPS before 2010, so it was impossible for it to take a prosecution. Cases are now being referred and the CPS will make its best judgment on whether a prosecution can be achieved.
The hon. Lady is right about the evidence. That is where mandatory reporting is so important, because it means that those professionals who feared coming forward and saying they had seen this, because they feared it was somehow going to create a cultural difficulty, now know that they have to come forward and we will get that evidence.
Naz Shah
We have had 386 reports connected to FGM since 2009. I accept that the law is complicated, but we have the evidence. Do we need to do more in terms of changing the law? The prosecution that was pursued had nothing to do with a parent or a non-family member; it involved a medical practitioner who was not trained and who was found not guilty. It was not set within the context of the law—when we introduced the law, it was not for that kind of case. It is exactly the same for forced marriage: when we prosecuted in Cardiff, the first prosecution was not to do with parents or people who take very young girls out of the country to get them married. In both instances, we are failing. Please can we acknowledge that and do something more than just what we are doing here, because clearly we are not doing it right?
Karen Bradley
I dispute that we are not doing enough. I absolutely share the hon. Lady’s frustration about the lack of prosecutions and successful convictions. However, the measures in the Serious Crime Act 2015 were included in response to failings or gaps in the law that this Government perceived. We have taken those steps, but she has to recognise that that does not simply change things overnight. The changes to the law apply to offences committed after the Serious Crime Act commences, and there will be a time lag, which we all have to acknowledge, while evidence is gathered and before a prosecution takes place. I want to see a prosecution and a successful conviction as much as she does but, also, I do not want to see FGM happening in the first place. The hon. Lady is right that a successful conviction would send a clear message, as it has with forced marriage, that the practice is not acceptable. We must have the deterrent of a successful conviction, but we also have to prevent this practice from happening. A conviction is, in many ways, a failure, because a crime has happened. That is not a success; a success is preventing it from happening.
The hon. Member for Luton North and my hon. Friend the Member for Kensington made a point about men. They are both absolutely right; we need to change the culture, and not just among women. We need women who have been victims or who are worried about their siblings and members of their family to come forward, but we also need men to speak out.
One of the most heartening things I heard over the summer was when I visited the Border Force safeguarding team at Heathrow terminal 5. The law had only changed a week before, and the team told me about their experiences of families traveling out of the country, often via the middle east, to countries where FGM may take place. It was the men—the brothers, the uncles and the fathers—who said to the Border Force guards, “Thank you for having told us that this is a criminal offence and that if this happens to my daughter, sister or niece while she is out of the country, you will be watching for that on her return and we will face jail for having allowed it to happen. That means I have the power and the authority to tell members of my family who want to do this to my relative that they cannot, because it is a criminal act here in the UK.” That is such an important point.
Kelvin Hopkins
The Minister makes a good point. Getting across to men the idea that they do not want their daughters to be mutilated because it is wrong, as well as being fearful of prosecution, is fundamental. The idea of this happening to my granddaughter is unthinkable, and we want it to be unthinkable for all men. In societies that are strongly patriarchal, the man’s view counts.
Karen Bradley
The hon. Gentleman is absolutely right; we have to change attitudes among men and women, so that they understand. I cannot imagine how any father could think of this happening to his daughter, but the excuse given is, “You will need to do this to your daughter, otherwise she will not be attractive to men.” Fathers need to speak out and say that that is simply not the case. We need to ensure that as many people as possible speak out and say that. I commend all the campaigners on this issue, some of whom are victims themselves and many of whom make that argument.
I want to make a point about training. I mentioned in my opening statement that the Department of Health is funding a £3 million national FGM prevention programme, which is under way in partnership with NHS England and has reached thousands of professionals. More than 2,000 professionals have attended women’s sessions, and nearly 8,000 GPs have received resource packs. The next stage of the programme includes work to address the mental health needs of those who have had FGM and to improve the NHS safeguarding system.
We have had a good and open debate. I appreciate the support from both sides of the Committee, and I share the frustration about the lack of a successful conviction. We are all sending a message that that is what we want to see. I accept the points made and will write to members of the Committee about the helpline and how this offence can be reported. I assure the Committee that the Government will continue with the range of work under way on FGM, ensuring that best practice and information is shared at both the European and international level.
Question put and agreed to.
Resolved,
That the Committee takes note of European Union Document No. 17228/13, a Commission Communication: Towards the elimination of female genital mutilation.
Petition
Wheelchair access to railway stations
Charities (Protection and Social Investment) Bill [ Lords ] (First sitting)
(8 years, 4 months ago)
Public Bill CommitteesRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Chair
Before we begin, I have a few preliminary points. Please switch electronic devices to silent. Tea and coffee are not allowed during sittings. Members may, if they wish, remove jackets during sittings. Today, we will first consider the programme motion on the amendment paper, and then we will consider a motion to enable the reporting of written evidence for publication. In view of the time available, I hope that we can take those matters formally without debate.
Ordered,
That—
(1) the Committee shall (in addition to its first meeting at 9.25 am on Tuesday 15 December) meet—
(a) at 2.00 pm on Tuesday 15 December;
(b) at 4.30 pm and 7.00 pm on Tuesday 5 January;
(c) at 11.30 am and 2.00 pm on Thursday 7 January;
(2) the proceedings shall (so far as not previously concluded) be brought to a conclusion at 5 pm on 7 January.—(Mr Rob Wilson.)
Resolved,
That, subject to the discretion of the Chair, any written evidence received by the Committee shall be reported to the House for publication.—(Mr Rob Wilson.)
The Chair
Copies of written evidence that the Committee receives will be made available in the Committee Room. We will now begin line-by-line consideration of the Bill. The selection list for today’s sitting is available in the room. It shows how the selected amendments have been grouped together for debate. Amendments grouped together are generally on the same or a similar issue. A Member who has put their name to the lead amendment in a group is called first; other Members are then free to catch my eye to speak on any or all of the amendments within the group. A Member may speak more than once in a single debate.
Please note that decisions on amendments take place not in the order in which they are debated, but in the order in which they appear on the amendment paper. In other words, debate occurs according to the selection and grouping lists, and decisions are taken when we come to the clause that the amendment affects. I hope that explanation is helpful. I will use my discretion to decide whether to allow a separate stand part debate on individual clauses and schedules following the debates on the relevant amendments.
Clause 1
Official warnings by the Commission
Anna Turley (Redcar) (Lab/Co-op)
I beg to move amendment 2, in clause 1, page 1, line 16, after “give” insert “at least 14 days”.
To require a minimum period of 14 days’ notice of a warning.
It is a pleasure to serve under your chairmanship, Mrs Main. Thank you very much for this opportunity. As we stated on Second Reading, we wholeheartedly welcome the Bill and the intention to clarify and support charity law, particularly by introducing greater transparency, greater effectiveness in governance and greater efficiency. The Bill will also give charities a new power to make social investments.
The intention behind clause 1 is to introduce a new official warning for the Charity Commission where it considers that there has been a breach of trust or duty, or other misconduct or mismanagement. Our amendment, which we believe is important, would require a minimum period of 14 days’ notice if a warning is issued.
We welcome the clause in principle. We understand that the purpose behind it is to fill a gap for low-level breaches of the statutory provisions of the Charities Act 2011 or of the fiduciary duty where there are low risks for assets and services. The National Audit Office welcomed it and said it will give the Commission
“a stepped approach so that, rather than just having, on the one hand, advice and guidance and then the nuclear option of a statutory inquiry, it gives the Commission something in between”.
We welcome the principle of the warning process.
However, we have some concerns about the clause, particularly on the lack of safeguards, which we believe could threaten the independence of charities and fundamentally change the relationship between the Charity Commission and its volunteer trustees. The commission already has a number of powers to deal with regulatory concerns—even low-level concerns. In particular, it can do so by way of operational compliance cases, which it routinely carries out.
Statistics from the Charity Commission show that between 1 April and 30 September 2015 it opened 575 operational compliance cases into registered charities. If the matter is urgent, the commission can already open a statutory inquiry without notice and suspend the trustees, pending the use of additional protective powers. The decision to open a statutory inquiry and the subsequent exercise of protective powers can be appealed to the charity tribunal, known as the first-tier tribunal. There are no plans to change that.
Operational compliance cases are likely to be regarded very differently from the new official warnings, which could have a significant impact on a charity. First, it is likely that the public issuing of an official warning, which is allowed in this version of the Bill, will carry far more stigma than an operational compliance case and could risk damage to a charity’s reputation, with a resulting drying up of funding and support.
Secondly, failure to comply with a warning automatically gives rise to a right for the commission to take further, significant protective action in relation to a charity, after opening a statutory inquiry. That is not the case with an operational compliance case, so this is a fundamental shift in the relationship between charities and the commission.
Peter Kyle (Hove) (Lab)
It is a pleasure to serve under your chairmanship, Mrs Main.
The relationship between the regulator and charities is a sophisticated one, and it is important that the Charity Commission plays a supportive role as well as a challenging one. Does my hon. Friend agree that the ability to send a warning notice without notice is a sign of failure in the relationship between the regulator and the charity, rather than one of support or challenge?
Anna Turley
My hon. Friend makes a really important point. The relationship is long standing, sophisticated and complex. It is right that there is an opportunity to give notice of a warning in the Bill. Our issue is that there is no significant timeframe and no notice of the timeframe. I will explain why that is such a critical issue, but my hon. Friend is absolutely right; it is important that there is a nuanced and balanced relationship and opportunities for both sides to state their case in any dispute.
I will now focus on the amendment. The Bill helpfully ensures that before issuing a warning, the commission must give notice of its intention to do so. However, there is no indication in the legislation of timescales for a warning. The briefing from the commission states that
“the Commission has confirmed it will ensure that a reasonable time for representations is given”.
It continues:
“The timing is likely to vary for warnings in different cases, depending on how much engagement and warning the charity has had during engagement with them, and there may be times when the timescales might have to be relatively short (if, for example, it relates to a time critical incident)”.
It states that operational guidance for its staff will be published. However, this seems very vague and gives total discretion in this situation to the commission. What is a reasonable time? Could that mean a matter of hours or a phone call before a press release is sent out? We know the potential damaging implications for a charity of publicity around the warning.
Jo Stevens (Cardiff Central) (Lab)
The problem with the term “reasonable” is that it is subject to interpretation. We can tell from case law and statute that what is reasonable in one circumstance is not reasonable in another. This will create a lack of clarity around the implementation of the Bill. Does my hon. Friend agree that it would be much better to have clarity and specific time limits so that both the Charity Commission and the charities are clear about what the expectation is?
Anna Turley
I totally agree. That is the purpose of the amendment. There is a lack of clarity around “reasonable time”. Not only is that pretty indefinite, but it puts the onus back on staff at the Charity Commission, which could place an undue burden on them and leave open to interpretation what the definition of a reasonable time could be. That is why it is important to have a timeframe in the Bill.
Without a timeframe, there might be no opportunity for a charity to prepare a defence or to correct an unconscious mistake, which could be the cause of the warning, or to let trustees know. We might end up in a ridiculous situation in which they could read about a warning for their charity in a newspaper or a sector magazine because, as the Bill is drafted, the Charity Commission can publish the warning. Such a warning, especially if published, could have a substantial impact on a charity’s ability to raise funds and might have significant reputational damage.
It may be felt that a prescribed period of notice is not necessary because the Charity Commission will act reasonably and proportionately. I do not doubt that will always be its intention; I know that the Charity Commission does an extremely good job in difficult circumstances, often with many resource pressures. However, recent experience shows that is not always the case. In a recent High Court case involving the commission and the Joseph Rowntree Charitable Trust, the Lord Chief Justice referred to “ludicrous time limits” imposed by the commission. He also said that he could understand why it was felt that the Charity Commission had behaved in an extremely high-handed manner in that case, and suggested that there should have been
“an awful lot more time spent at the beginning talking, as people normally do, and not issuing ultimatums”.
There is therefore a real danger that the commission, if allowed scope to use this new power in a disproportionate way, may well do so, however well meaning its intentions.
If the power is intended to be used only for low-level matters, a minimum notice period of 14 days is entirely appropriate. It is not clear why there should be any objection to that. For more serious matters where the Commission is able to take more extensive regulatory action, it will be able to use its other powers without notice. That is the existing situation. The Joint Committee on the Draft Protection of Charities Bill recommended that a reasonable minimum notice period to make representations over a draft warning should be clear in the Bill. That safeguard has not been included and the amendment seeks to rectify that.
Moreover, it was clear, even from the Government’s response to the Joint Committee’s report, that a recipient should have an opportunity to make representations on a proposed warning and for these to be considered by the commission before the warning is published. There is no minimum notice period, and it is possible that a recipient will not have a meaningful opportunity to make representations. We know that there have been many situations in which advice and support given by the commission can be challenged and are open to interpretation by the charity.
Jo Stevens
A warning could have human rights implications. It might harm a trustee’s reputation, for example, or be in breach of his or her rights under article 8, particularly in the absence of a fair trial, as preserved by article 13. Is my hon. Friend concerned that the Bill has implications for human rights?
Anna Turley
I completely agree with my hon. Friend. A later amendment sets out the right of appeal to the charity tribunal, which we think is an important safeguard. Even without that appeal, giving no notice whatsoever could entail significant risks, particularly with regard to reputational damage, as the Human Rights Act sets out.
Peter Kyle
My hon. Friend is being generous with her time. Trustees of boards of charities are volunteers, and they give up their time very generously. Quite often, boards are cautious in their approach. Does my hon. Friend think that seeing warning notices handed out to other charities might well be a deterrent to people giving up their time and lead to uncertainties over governance arrangements?
Anna Turley
My hon. Friend makes another excellent point. We know how difficult and challenging it can be around the country to get good trustees and to get people to stick with it. Trustees are under a lot of pressure because of regulations and time commitments. There is the risk that the measure will disadvantage trustees and deter them from putting themselves forward. If a warning has been published, the reputational damage could be huge.
The Lord Chief Justice referred to “ludicrous time limits”. He also said that he could understand why it was felt that the Charity Commission had behaved in an extremely high-handed manner and that there was a real danger that the Commission, if allowed the scope to use this new power in a disproportionate way, may well do so, however well meaning its intentions.
We are not seeking to remove the power to publish a warning, because we think that it is important. The ability to publish a warning should be there, because of the opportunity it gives to create greater weight behind a warning. However, we think that before that step is taken there should be significant opportunity for a charity to challenge it. That is what our proposed 14 days’ notice seeks to do.
The power to publish a warning, the potential impact of which cannot be overstated, means that the public, media and funders will become aware of it. They will not be able to distinguish between a low-level issue that is giving rise to the warning and something that is much more severe. In the court of public opinion, such issues often become conflated. This year we have already seen a huge media furore relating to the charitable sector. Although relevant to only a small number of charities, it has had a substantial and damaging effect on trust in the sector. The publicity could lead to a choking off of donations and the loss of grant funding and corporate sponsorships, leading to closure of services and redundancies.
To give advance notice of 14 days of a warning, as our amendment proposes, would allow a charity to ensure that steps can be taken immediately to remedy a situation, where it is a small administrative error, to explain any extenuating circumstances and to challenge that with the Charity Commission. It would allow the conversations mentioned by the Lord Chief Justice in the High Court case to take place in a supportive and trusting environment.
We believe that there is no reason why there should not be a 14-day notice period ahead of a warning. We hope that the Government will support our amendment.
Mr Alan Mak (Havant) (Con)
It is a pleasure, Mrs Main, to serve under your chairmanship. I welcome the Bill and will refer to clause 1, as well as to other provisions.
Charities play a vital role in civil society and local communities across Britain. They care for the sick, feed the hungry, raise money for veterans and protect the natural and built environment. They rely on generous public support and confidence in order to continue their vital work. Deliberate abuse of charities is relatively small, given the size of sector. However, it needs to be tackled robustly to protect public trust and confidence.
The Bill, particularly clause 1, would equip the independent regulator, the Charity Commission, with the tools that it needs to tackle more effectively the types of abuse it faces. That in turn should protect charitable donations and reassure the giving public that charities are well regulated. Clause 1 inserts into the Charities Act 2011 new section 75A, which provides the Commission with a power to issue an official warning to a charity or a charity trustee. That warning may be given where there is a breach of trust or duty by a charity or trustee, or other misconduct or mismanagement in the charity. Breach of duty can also include non-compliance with a commission order or direction. That warning system is similar to powers vested in other regulators, but it is a more reasonable and proportionate way to deal with breaches of the 2011 Act and fiduciary duties or other mismanagement episodes, particularly where the risks and impacts on charitable assets and services are relatively low.
Before I had the privilege of entering this House, I was fortunate to be a trustee of a small but successful children’s charity working across the UK. My experience of working with donors, funders and beneficiaries suggests that the new powers in clause 1 will be welcomed by all those in believe in the proper governance and oversight of charities by bolstering public confidence in charities.
The new power is a more proportionate use of the Charity Commission’s powers, and a better alternative to a number of other remedial powers such as suspension or removal of trustees, or restitution action against trustees. An example of where the power might be used is where a charity makes unauthorised payments, for example, to a connected company or for the benefit of a particular trustee. In such a case, the size of the sums involved may mean that it is disproportionate to take stronger action but the Commission could issue an official warning on future conduct, as stipulated under clause 1.
Another case might be where the charity’s governing documents have been breached. For example, there has been a failure to call elections or annual general meetings, which would compromise the proper functioning of the charity and public faith in the charitable sector. The powers in clause 1 would be a proportionate and effective means of ameliorating that situation.
Peter Kyle
It is a privilege to speak under your chairmanship, Mrs Main. Like the hon. Member for Havant, I have served on charity boards. In fact, I was involved in founding two charities and have seen them grow and thrive. My role included the challenge of recruiting trustees to two charity boards.
I have seen the charitable sector from many different perspectives, including working for almost six years for an umbrella organisation in the sector. I can see from different perspectives the challenges but also the opportunities that the voluntary sector provides to society. It is embedded fully in civil society, and increasingly delivers public services, which are often integrated in the welfare state. That is a fantastic and growing part of our voluntary sector, and we should be proud of it.
The delivery of public services is an aspect of the voluntary sector that does indeed need greater regulation and scrutiny. The public needs to know, since the sector is funded by taxpayers’ money, that it is scrutinised accordingly. I therefore welcome many aspects of the Bill.
Peter Kyle
The Minister is shaking his head. I look forward to his speech and to hearing his views, because he has kindly listened to mine. Trustees are cautious people: they are volunteers and they are not often law experts. They want to make sure that the organisation for which they voluntarily give up their time does not make headlines for the wrong reasons, which means they often become cautious. I cannot see exclusions in the legislation on the application of warning notices.
For example, I hope the Minister will say that tweets and public statements that criticise Government policies will be excluded from the issuing of warning notices. He might not be able to give an example, but if the practice is allowed to continue unhindered, it may well give the impression to boards of trustees that the Government criticise bold and forthright statements that are made by trustees when their client groups are challenged, or public policy is not rolled out in their best interests. We need a very clear and unequivocal statement from the Minister, on the record, that that is not the case and that warning notices will not be used to challenge the advocacy role of charities.
Charitable organisations reach right the way through our society. For example, many academy schools are charitable trusts registered with the Charity Commission. Schools, therefore, might well be issued with warning notices. There are many areas of public service that come under the remit and regulation of the Charity Commission. I am chair of governors of a school which is registered with the Department for Education as an academy school and with the Charity Commission as a charitable trust. Has the Minister looked at these complex registration challenges and regulatory circumstances and made sure that the right exclusions are put in place to reassure trustees that the Government will always protect their interests and their independence?
Several hon. Members rose—
The Chair
Before I call Maggie Throup, I have to say that the last two speeches, although I am sure they were very valuable contributions, were about clause 1 more widely than about amendment 2, so we will not have a separate stand part debate on clause 1. If other Members would like to contribute to the wider discussion of clause 1, I suggest they catch my eye now.
Maggie Throup (Erewash) (Con)
I am delighted to be able to speak in support of clause 1 of this very important Bill, which strengthens and protects our charities, which play a very important role across our nation. We are stronger for the work that our charities carry out. We would be much poorer as a nation if we did not have our amazing charities and, indeed, I can cite many examples in my own constituency. Millions of people every day rely on charities, and millions of people every day willingly give up their time to volunteer. It is the hundreds of thousands of generous volunteers who really make a difference, and 41% of people reported that they took part in volunteering last year. That is a massive 21 million people across the UK. Trustees play an important role in charities, and in the past I have been a trustee for two different charities. Before being appointed, on both occasions I went through a rigorous selection process that put me under a lot of scrutiny. This is only right, as trustees play an important role. Sadly, we have recently heard some bad news stories about instances in which trustees were not quite as scrupulous as they should have been. That should not happen, as it reflects badly across the whole charitable sector.
The Charity Commission has a wide range of powers, but they need to be strengthened. It is only right that the regulator has the powers that charity users and volunteers expect. Those powers are there to protect the charity, but ultimately they protect charity users, who are likely to be the most vulnerable people in our society. I do not believe that the powers included in the Bill are draconian; they fill a crucial gap. Clause 1 provides an effective way of handling low-level breaches of statutory provisions of the Charities Act 2011. It fills the gap between the existing situation in which the Charity Commission can give advice and guidance and the nuclear option of statutory inquiry. I am sure that every charity will welcome this gap being filled. In effect, it will put a charity on notice, and will help to prevent it from reaching a position where that nuclear option is required without an interim warning.
Clause 1 lays out very clearly the steps that the Charity Commission will have to take if it needs to issue an official warning to a charity or charity trustee. Such clear steps are important for the Commission, for charities and for trustees. I do not believe that amendment 2 is necessary, because the notice period it contains could work against what the Charity Commission is trying to do and what the Bill is trying to do. A lot of evidence could be destroyed in that notice period. As has been indicated, it would not allow time-sensitive issue or breaches to be handled in an effective way.
Jo Stevens
The hon. Lady has suggested that if notice of a warning was given, evidence would be destroyed. Are there any examples of that happening?
Maggie Throup
I think not only in the charity sector but across the board, evidence can be destroyed or changes made very rapidly, so the provision would begin to undermine the purpose of the Bill, which tries to help charities rather than be too draconian. That is the measure we want to take with this clause.
Robert Jenrick (Newark) (Con)
Does my hon. Friend acknowledge that most regulators in other spheres have the power to issue warnings without notice? For example, the Financial Conduct Authority has those powers for precisely the reasons that she has just given.
Maggie Throup
I completely agree with my hon. Friend. That is probably why the measure is in the Bill. It mimics what is happening across the board with other regulators.
Peter Kyle
I am extremely grateful to the hon. Lady for giving way. If a charity has reached the point where its trustees are destroying evidence, does she not agree that it has probably reached the point where a warning notice is not sufficient in the first place?
Maggie Throup
The problem is that if the evidence has been destroyed, no one knows whether it was there. That is the case I want to make. We want to make sure that correct action can be taken in a timely fashion.
Anna Turley
The hon. Lady said that the measure could make the powers of the Charity Commission similar to those of other regulators. However, while many other regulators have the power to issue warning notices, they are often exercisable only in the case of a breach of a statutory requirement. This proposed power goes much further than that. A warning can be given on the strength of
“a breach of trust or duty or other misconduct or mismanagement”.
The hon. Lady will agree that that gives the Bill a fairly broad scope. The adverse publicity and possibility of more severe regulatory action that could flow from that would not match what had actually been breached at that stage.
Maggie Throup
I have to disagree with the hon. Lady. Regulatory abuse in charities is of course rare, but it is vital that measures are in place to ensure that the public and, indeed, the many charity volunteers do not lose confidence when it happens.
Clause 1 provides a suitable means of protecting our many charities, small and large, from unscrupulous behaviour. It will maintain the confidence of the public, the many donors and the amazing volunteers, as well as those employed by charities. I am delighted to have been able to speak in support of the clause, which I commend to the Committee.
Wes Streeting (Ilford North) (Lab)
It is a pleasure to serve under your chairmanship, Mrs Main. Like many hon. Members who have spoken, I have experience in the voluntary sector. I have been the chief executive of a small national charity, a senior manager in a medium-sized national charity and a trustee of local and national charities. I continue to be a patron of a number of local charities, although I will spare the Committee a list of all of them. I do not think that, as a patron, I will come under the scope of the Bill, but as a trustee I certainly have cause for concern.
As has been said, it is important that the public have confidence in the vibrant voluntary sector throughout the UK. It is worth stating that, considering the professionalism of the work that takes place in the sector as a whole, the public should have that confidence. In a week where there has been some unhelpful and, I would argue, misleading coverage about the quality of charities and the way in which donors’ money is spent, it is worth repeating that case, because there is a lot of mischief-making going on. It is important to have in place the right regulatory framework to give the public confidence, but whenever we pass legislation in this place we should ask ourselves what problem we are trying to solve; whether the approach we are considering would be effective; and, most importantly, whether the legislation is proportionate. The measures in clause 1 fail many of those tests.
Tom Tugendhat (Tonbridge and Malling) (Con)
The hon. Gentleman rightly raises the question of proportionality. I would merely argue that one must not forget that the charitable sector enjoys a huge benefit from the state; after all, the tax break is a state subsidy. I do not think any of us—certainly not the hon. Gentleman himself—would challenge the importance of that state subsidy, but although it is hugely welcome and important to the sector, it imposes a burden. The charitable sector must account for its actions in exactly the same way as other organisations that receive benefit from the state should do. The clause is one element in ensuring that that happens.
Wes Streeting
I am grateful to the hon. Gentleman for making those points. It is absolutely right that charities benefit, particularly from gift aid. As an avid, although somewhat despondent, viewer of “The X Factor”, I notice that the Chancellor has generously waived VAT on the winner’s single, which I am sure we will all be rushing to buy.
The Chair
Order. Before the hon. Gentleman intervenes, we are way off the point of the clause. We widened the debate to include clause 1 because many Members wanted to speak, but “The X Factor” and VAT are far beyond the scope of the debate. If the hon. Member for Hove was going to intervene along those lines, I caution that he might wish to reconsider.
Peter Kyle
My intervention was going to be on regulation in general and its burden on the charitable sector, but I will happily withdraw if the Chair so wishes.
Wes Streeting
I apologise, Mrs Main, for the fact that my enthusiasm for cheering the Chancellor went too far.
In response to the intervention by the hon. Member for Tonbridge and Malling, it is worth pointing out that the state also gains a great benefit from charities. As my hon. Friend the Member for Hove said, many voluntary sector organisations deliver public services. I would also argue that the voluntary sector is increasingly picking up the slack and the burden of a lot of public sector cuts by supporting some of the most vulnerable and disadvantaged in society.
Some of the points that have been made about the challenges that should be addressed by regulation are covered by existing powers. If a charity is consistently late in submitting accounts, that is a breach of the 2011 Act, and powers exist to deal with that. If a breach of a charity’s governing documents leads to governance problems, that would likely be covered by misconduct and mismanagement provisions, and the Charity Commission could open such an inquiry.
Wendy Morton (Aldridge-Brownhills) (Con)
It is a pleasure not only to serve under your chairmanship, Mrs Main, but to serve on the Committee and to support the Bill, which is both welcome and necessary. I want to speak both about clause 1 and in general support of the Bill.
As has been mentioned, charities do fantastic things across the country, both nationally and locally. We regularly hear of examples of their inspirational work. In my speech on Second Reading, I made reference to the great north run and I am always struck by the general public’s generosity and support for charities. I am sure we can all cite good examples from our constituencies of the work of charities and trustees. Small charities play a huge role in our local communities, providing vital services over and above those offered by the public sector. These small organisations, like larger charities, often make a big difference to the lives of individuals and their families.
Trust and confidence are vital in the charity world. Sadly, the high-profile charity crises that make it into the newspapers and on to TV can damage trust in charities. It is therefore important that we do all that we can to maintain and strengthen that trust.
Wes Streeting
The most high-profile case that is on all our minds is of course that of Kids Company. Given the heavy interaction between Kids Company, the civil service and Government Ministers at the highest levels, at what point does the hon. Lady imagine that the Charity Commission might have issued a warning notice if Ministers failed to spot the problem?
Wendy Morton
Kids Company is one of the charities that sadly did make it in to the newspapers and on to our TV screens and it has been debated in the House. It is an example of why the public’s trust is so vital. The Bill demonstrates the importance of having an effective charity regulator and strengthening the powers of the Charity Commission to protect charities from abuse. Clause 1 focuses in particular on trusts and trustees and the issue of warnings. That is the right and appropriate thing to do. We will move later to the additional powers to spend and to remove trustees. In doing so, it is important that we recognise that deliberate wrongdoing is rare. It may be unlikely that the new powers are used many times, but let us hope that they are not.
Tom Tugendhat
My hon. Friend is making a powerful case. Does she agree that having the powers on the statute book is part of the persuasion that allows them not to be used?
Wendy Morton
Absolutely. I was about to say that it is important that we have the powers to protect and safeguard charities and their reputations and to maintain the trust of the public, on whose generosity they depend. That also helps trustees, who usually do their job out of the goodness of their hearts, often for a cause that is close to their hearts. They deserve that trust, respect and support.
It is understandable that the mention of additional powers can raise concerns. It is important to ensure that smaller charities are not disproportionately affected. I do not believe they will be, but that is something to be mindful of. It is equally important to reassure the public that charities are more accountable and, in particular, that large charities are transparent about their fundraising and their activities.
In conclusion, in our drive to maintain and strengthen public trust in charities, we should be mindful that the Bill is helping, not hindering. I therefore support it and hope that clause 1 will stand part of the Bill.
Mr Wilson
It is a great pleasure to serve under your chairmanship, Mrs Main. This is a Bill on which there is a great deal of consensus across the House. I think we all accept that the regulatory powers of the Charity Commission needed to be brought up to date, to support the regulator in tackling cases of abuse in charities.
The Bill has already been through significant scrutiny. The previous Government first published their proposals for public consultation just over two years ago, in December 2013. Those followed criticism of the Charity Commission’s powers by the National Audit Office and were based on proposals put forward by the commission itself. There was broad support for the measures from charities, particularly small ones, although some measures received mixed reactions from charities and their representative bodies.
The proposals were refined as a result of consultation and a draft Bill was published in October 2014. The draft Bill was subjected to extensive pre-legislative scrutiny by the Joint Committee on the Draft Protection of Charities Bill, ably chaired by Lord Hope of Craighead, a former deputy president of the Supreme Court. I pay tribute to its detailed scrutiny, which led to a number of improvements and refinements being made. We should also note that the Bill has already been considered in detail in the other place, in a largely collaborative and consensual way. That, too, led to sensible refinements to the Bill. I very much hope that we can continue working together in that spirit of cross-party consensus on most aspects of the Bill for the benefit of the Charity Commission and the public.
Before moving to clause 1 and the amendments on official warnings, I want to make three more general points. First, I repeat what I said on Second Reading: the vast majority of charities are run well by decent, honest people who selflessly want to do good for the benefit of others. When considering these powers, it is important to remind ourselves that they will help to protect public trust and confidence in charities generally and will target only the minority involved in abuse.
Secondly, I want to place on record my thanks to the staff and the leadership at the Charity Commission, who are transforming the commission into a modern, proactive, risk-based regulator and who will use the new powers in a targeted and proportionate way. I was pleased to see that, when the National Audit Office returned to the commission just a few months after publishing its report, it found that it had made “good, early progress” against all its recommendations. That progress is down to the effective leadership and hard work of everyone at the commission.
The third point is an overarching one relating to the Charity Commission’s duty to act in line with the principles of better regulation, human rights and equalities duties, some of which have already been raised. These all require the commission to carefully consider a number of factors when exercising its powers. The duty is set out in section 16(4) of the Charities Act 2011:
“In performing its functions the Commission must, so far as relevant, have regard to the principles of best regulatory practice (including the principles under which regulatory activities should be proportionate, accountable, consistent, transparent and targeted only at cases in which action is needed).”
The Charity Commission also has a published risk framework that explains this regulatory approach to protecting the public’s interest in charity and how it assesses risks and manages its resources. The commission’s risk framework sets out the criteria it uses to determine whether it should open a statutory inquiry and where it is likely to use its temporary and/or permanent powers. In assessing regulatory issues that come to its attention by whatever means, the commission needs to be as sure as it can that the facts are correct and that it does not act on a false or unproven premise. It relies on information as evidence in its case work when making decisions.
The commission also has to act fairly and needs to be able to explain its actions to trustees and those directly affected by its decisions when it exercises legal powers. The commission may be called to justify its actions by the first-tier tribunal for charities or by the court. In doing so, the commission needs to show that its action has been taken on the basis that relevant issues have been properly considered. In assessing information and deciding to use it, it is important that the commission acts fairly and consistently in line with the principles set out in its guidance. The commission also considers its decision-making, as it is bound to, in accordance with the relevant statutory duties, namely those relating to the best regulatory practice, proportionality, human rights, the Equality Act 2010 and wider public law considerations.
I will now turn to clause 1 before responding to amendment 2. I will also try to respond to all the issues that hon. Members have raised during the wider debate on clause 1. The clause gives the Charity Commission an important new power to issue an official warning. This is one of the most important new powers in the Bill and is considered to be a normal power in the toolbox of modern regulators. It is already a staple tool of other regulators, such as the Care Quality Commission, the Financial Conduct Authority, the Pensions Regulator and the Solicitors Regulation Authority, to name a few.
An official warning could be issued to a charity trustee or to the charity itself where the Charity Commission considers there to have been a breach of trust or duty or other misconduct or mismanagement. The power would enable the Charity Commission to publish a warning, which it has said it would do in most cases. The commission has also said that it would not publish all warnings. The decision to publish would be in line with its current policy on publishing the announcement of statutory inquiries, which depends on whether publication is in the public interest. The Charity Commission would not publish an official warning if it considered that it would not be in the public interest to do so.
The Charity Commission does not expect to use the power too often. It is hard to put a precise number on it, but the commission estimates that it would be in the dozens of warnings each year, rather than the hundreds. Let me give two examples of when the Charity Commission might consider issuing an official warning—let us remember that these are low-level activities. One example is when a charity is consistently a little late in submitting its accounts. An official warning would remind the trustees of the seriousness of their non-compliance. We recognise that this is already a criminal offence, but it is rarely investigated or prosecuted as such. An official warning would be a much more proportionate response to encourage trustees to rectify the position.
The second example is when a charity makes unauthorised payments to a connected company or payments that benefit a trustee. If the size of the sums involved meant that it would be disproportionate for the Charity Commission to take firmer action, it could issue an official warning on future conduct. As one would expect, the power is subject to a number of important safeguards.
Peter Kyle
On its website, the Charity Commission already highlights in red those charities that submit their accounts late. The commission has said that this has had a significant impact on behaviour in the sector. Is the Minister saying that this is not enough? Can he give the precise number of charities where this is not working and where there will be an impact?
Mr Wilson
Clearly it is not enough, because the Charity Commission has asked for the additional powers. I am sure the Charity Commission would be only too happy to answer the detailed question about the number of affected charities.
I want to return to the safeguards, because there are a number of important safeguards on which we should focus our attention. First, the Charity Commission must give notice of its intention to issue a warning to a charity and its trustees. The notice must specify a number of matters, including the grounds for issuing the warning and any action the Charity Commission considers should be taken by the charity to rectify the breach that has given rise to the warning in the first place.
The notice must specify a period for representations to be made about the proposed warning, and the Charity Commission must take account of any representations before it issues any warning. An official warning could also highlight the likely consequences of any further non-compliance, which would be likely to require a more significant intervention by the regulator, such as the opening of a statutory inquiry and subsequent use of its temporary protective powers or its permanent remedial powers.
Anna Turley
I appreciate the Minister setting out those important safeguards. However, there is little evidence about the timeframe in the Bill, which means that charities have no control over their ability to present their arguments and let their trustees know. We will continue to press on this issue unless the Minister has some analysis of what is a reasonable time.
Mr Wilson
I will come to that exact point in the amendment in a few moments. I hope I can give the hon. Lady some comfort that we are responding to her request.
Let me return to the important safeguards. This measure is the one new regulatory power in the Bill that we and the Charity Commission expect may impact on more charities than any of the other proposed powers. Most of the powers in the Bill are targeted at serious, deliberate abuse of a charity or serious mismanagement putting charity assets or beneficiaries at risk. The official warning power would be used more frequently by the Charity Commission as a more reasonable and proportionate way of dealing with breaches where the risks and impact on charitable assets and services are lower.
The Joint Committee on the draft Bill gave its qualified support to the official warning power, saying:
“We are however persuaded that in principle it would be useful for the Commission to have at its disposal ‘something in between’ guidance and the opening of an inquiry”.
It qualified its support for the official warning power by recommending that several points be addressed in the Bill. The Government accepted all but one of these. The Joint Committee recommended limiting the scope of a warning to a breach of statutory provision or breach of Commission order or direction.
Jo Stevens
The Joint Committee was satisfied that the issue of a warning did not meet the further safeguard and appeal to a tribunal. It reached that conclusion on the basis that necessary details were added to the Bill. However, those details are not in the Bill. Will the Minister respond to that point?
Mr Wilson
The criteria for issuing an official warning are now clearly stated in the Bill—breach of trust or duty, or other misconduct or mismanagement. These are not as narrow as the criteria recommended by the Joint Committee, but we decided that limiting the warning power to a failure to comply with a limited range of statutory provisions, or order or direction of the Commission, would result in a power that was only half effective at best. Charity law is a mix of statute and case law, and the scope of the warning power needs to reflect that. It would be wrong to limit the warning power to just breaches of statutory provisions or commission orders or directions, as this would limit the regulator to issuing warnings on less than half the legal framework.
I recognise that a breach of duty might not always be completely clearcut, but it is right that the regulator of charities should be able to reach a view on whether a charity’s trustees have breached their duties, and should be warned about their conduct. It would be wrong to expect the Charity Commission to have to open a statutory inquiry and consider exercising its more serious compliance powers in cases where charity trustees have breached their duties but not a specific statutory provision.
Anna Turley
The Minister is being extremely generous with his time. Does he agree that there are things that lie between breaking a statutory definition and what we are talking about here, which is quite a low level of concern: a breach of trust or duty, or other misconduct or mismanagement? That is quite broad in scope. Should there not be further definition—not necessarily in statute, but perhaps from the Charity Commission—to identify the criteria for that?
Peter Kyle
We are all very grateful to the Minister, who has been generous with his time, for allowing us to probe for more detail. The Joint Committee also recommended a minimum notice period to make representations on a draft warning before it was issued. My hon. Friend the shadow Minister suggested a 14-day period, which seems extremely reasonable. Does the Minister agree?
Mr Wilson
I would like the hon. Gentleman to be a little patient. I know I am going on a bit—these are issues that need a detailed explanation—but I promise I will come to his point and answer all the questions that have been put.
On process, we have set out in proposed new section 75A(5) of the 2011 Act the matters that must, as a minimum, be included in a notice of an official warning. These include the grounds for issuing the warning and action that the Charity Commission considers should be taken to rectify the warning. The Charity Commission must give notice of a warning, set out a period for representations to be made and take account of any representations before issuing or publishing a warning. We consider these changes to significantly improve the official warning power and we were grateful for the Joint Committee’s recommendations.
Let me turn now to amendment 2, which seeks to require the commission to give at least 14 days’ notice of an official warning in every case. I can see why the hon. Member for Redcar is attracted to that, as it would ensure that trustees had sufficient time in all cases to consider the notice of intention to issue a warning and co-ordinate any representations they might wish to make.
The commission will set out in guidance how it will operate the official warning power. The Charity Commission has said it would give publicity about this and is keen to work with sector representatives on the implementation of the power. That would be done before the statutory warning power is commenced. The guidance will set out the commission’s normal approach. The commission has confirmed that it will ensure that a reasonable time for representations is given, as is the case currently when trustees comment on the content of inquiry or operational compliance case reports before publication.
The time period between giving notice and issuing warnings will vary in different cases, depending on the level and extent of previous engagement with the charity, and the subsequent level of compliance. As a starting point, I would expect that to be 14 days, but there may well be cases in which a shorter notice may need to be given.
Let me give some examples of where a shorter period may be appropriate. A charity may have been strongly advised on several occasions, both under compliance visits and in writing, about taking small but repeated amounts of cash overseas to buy supplies for a medical centre, with no audit trail and no evidence of expenditure, when an equally legitimate banking arrangement was in existence, and the centre was a registered facility. A disaster happens in the same area and as a result the demand for the charity’s services and funds rises sharply. The commission becomes aware on a Wednesday that a payment is due to be taken in cash overseas by that Friday.
In that context, the Commission would want to issue a warning to the charity regarding its financial practices to minimise the ongoing risk to charity funds. Its warning would set out what the issue was—unacceptable lack of financial controls—and how that could be remedied, such as by using the banking arrangements already in place, considering a branch transfer and also ensuring that receipts are obtained for supplies purchased to satisfy the trustees’ duty to account.
A second example is where the commission might become aware of a charity that is conducting fundraising activities—raising money from the public—in an aggressive manner or with poor financial controls. It thereby poses a risk to charity property and public trust and confidence, for example by not collecting in sealed buckets or by depositing money into personal accounts. The commission is then informed that the charity is due to participate in a fundraising event in the next seven days. Currently, in that situation, in order to protect the charity the commission would have to open an inquiry and issue directions, which would take up significant time and resources. An official warning could address the issue at an earlier stage. The commission would need to issue its notice and publish the warning within a seven-day turnaround period.
As a final example, the commission might receive a whistleblowing report providing evidence of a low-level property or asset transfer that the trustees propose to enter into. The information provided by the whistleblower and a meeting with the trustees includes evidence that the proposed property disposition or asset transfer is not being conducted in accordance with the requirements of the Charities Act and their duties as charity trustees. If the transaction proceeds, a breach of trust and loss to the charity will occur. The proposed deadline for entering into the transaction is five working days from the last meeting, and the commission would want to issue a warning about following charity law requirements when engaging in property acquisitions.
In those examples, the issues identified in the charity are limited and specific. Opening an inquiry would be time consuming and in a sense misleading, as it may suggest that there are wider or more serious issues in the charity that need addressing when this is actually not the case. It would be wrong to prevent the commission from issuing an official warning in those circumstances, where an official warning may be the most appropriate and proportionate response to the misconduct or mismanagement in question. It would not be practical for the commission to be limited to a particular timeframe. The commission would always intend to give trustees fair notice, but this period may differ depending on the nature of the case. The commission’s guidance will deal with other matters, including its policy on when official warnings will be archived or removed. Its current policy on inquiry reports is that they are archived after two years.
I hope that I have been able to explain to the Committee how the official warning power will be used by the commission and that hon. Members will agree that it represents an important new tool for the commission in tackling lower-level misconduct and mismanagement. We do not want to create a power that results in more bureaucracy and red tape where it is not needed.
I now want to return to some of the issues raised in the debate, many of which were raised by the hon. Member for Redcar. Let me begin with misconduct and mismanagement and whether there will be guidance on this. The commission’s statutory responsibilities allow it to investigate issues that pose a significant risk to charities and to check abuse. Abuse is misconduct or mismanagement in the administration of a charity. The words “misconduct” and “mismanagement” should be interpreted as they are commonly understood. The premise is supported by case law. Misconduct includes any act or failure to act in the administration of the charity which the person committing knew or ought to have known was criminal, unlawful or improper. Mismanagement includes any act or failure to act in the administration of the charity which may result in charitable resources being misused or the people who benefit from the charity being put at risk.
Concerns of abuse are always taken seriously, but the level of the commission’s response will be proportionate and determined by the risk factors attached to the specific circumstances of the case as required by the commission’s risk framework, which I mentioned in my original comments. The commission’s updated CC3 guidance already sets out what types of action could constitute misconduct or mismanagement—I am sure hon. Members will be going away quickly to read that.
Let me turn to operational compliance cases, which are likely to be regarded very differently from official warnings. The Charity Commission already publishes details of some of its operational compliance cases when they give rise to wider lessons for charities. It is difficult to see how publishing an official warning would be any different, or why it would carry more stigma for the charity or trustee concerned. Charities exist for public benefit, so there should be transparency and accountability to the public, who are their ultimate beneficiaries.
The issue was raised of the real danger of the commission being allowed to extend the scope of its powers in a disproportionate way, with reference to the recent high-profile case of the Joseph Rowntree Charitable Trust and Cage. The reference to the JRCT-Cage litigation is a bit misleading in this situation. The court made no finding that the commission acted disproportionately—in fact, the court made no finding at all; the case was settled. Proportionality was not even one of the grounds of the challenge in the case. Furthermore, at the conclusion of the hearing, the Lord Chief Justice expressly stated that, of course, nothing at all that we have done comments in any way whatsoever on the underlying issues. Using the case is therefore a little unfair, if I may say so. It is one out of more than 500 regulatory compliance cases over the first six months of this year, so it is not representative.
Peter Kyle
I am grateful to the Minister for giving way, and I hope that it gives him a chance to catch his breath, because he has been rattling through the issues.
The Minister said that he was addressing serious concerns within the organisation. However, the point about the warnings being issued is that they are low to medium-risk warnings. Does he accept that the public sometimes do not know the difference in the types of warning and see only that a warning has been issued against a charity, and that there might well be big brand repercussions for what is a minor warning.
Mr Wilson
It is important that we do not have a situation in which charities can do no wrong. If charities cross the line, even in a low-level way, it is right that the Charity Commission should proportionately and sensibly be able to issue an official warning. That is why I fully support the principle of such warnings.
Campaigning was mentioned briefly by the hon. Gentleman early on his comments. To be clear, charities may not engage in party political campaigning. Where they undertake any types of campaigning to support their charitable purposes, they must avoid adverse perceptions of their independence and political neutrality. In addition, charities may not embark on campaigning to such an extent that it compromises their legal status as a charity. Charity Commission guidance CC9—I can see Members scrambling for CC9—is clear about what is and is not permitted. It makes it clear that charity law recognises that non-party political campaigning may be a legitimate activity and it sets out the general principles.
As long as charity trustees act within the legal framework, they are permitted to undertake activities that may include statements, lawfully and properly. That is relevant across all media platforms.
Peter Kyle
Those of us who run campaigning charities are very familiar with the regulations to which the Minister refers—
Peter Kyle
I see my hon. Friend nodding, recalling his days in charities.
The point is that for those in government, it is policy and it is not always party political, but those of us who are familiar with the regulations know that sometimes charities need to speak out absolutely. The Minister’s predecessor once said publicly that charities ought to “stick to their knitting”. Charities find that kind of statement offensive, and trustees interpret it as an indication that they should not get involved in public campaigns that might impact on Government policy. Will he say that charities should do everything beyond knitting, including challenging the Government? It does not have to mean that they are involved in party politics—
The Chair
Order. The hon. Gentleman is making a speech. The Minister may decide not to indulge in discussion of knitting, if it so pleases him.
Mr Wilson
My daughter has just taken up knitting. She is only eight and is doing a fantastic job.
It is clear that party political activity is outside the bounds of what charities should be doing. I think everyone accepts that. Sometimes there is a grey area, and if something is reported to the Charity Commission, it would rule one way or the other. I have stated on many occasions on public platforms that it is right that charities should be able to speak up for their beneficiaries, whether the Government like it or not, and I stick to that principle.
Another issue raised was the risk that adverse publicity could result from the publication of a warning. As I have said, it is important that charities are accountable to donors, beneficiaries and the general public. Since the 2006 Act, one of the commission’s statutory objectives has been to enhance that accountability. The argument against the clause is effectively that charities should not have to be accountable for things that they have done wrong. That is not fair to donors, beneficiaries and the general public, and reduces the incentives for charities to make future improvements.
A point was made about whether the commission should be allowed to publish warnings at all. Charities exist for public benefit and depend on public support, so there should be transparency. Official warnings should be published if the regulator considers it necessary to intervene, unless there is good reason not to publish the details of an official warning. Publishing those details also encourages compliance, thereby increasing the efficacy of the power.
Any published details of warnings would have to be removed by the commission after a certain period—as I said earlier, the commission currently archives after two years. There would be an opportunity to make representations about the factual accuracy of a statutory warning before it is published. A process for representations is included in the clause, following the recommendations that came during pre-legislative scrutiny. The commission has said that it will consult on and publish guidance on how it will use the official warning power before the power commences.
The hon. Member for Hove asked about the balance between the Charity Commission as friend versus the Charity Commission as regulator. I think we all agree that the commission needed to improve its regulatory performance on compliance and enforcement—the National Audit Office made that point—but that is not to belittle its other important regulatory functions, such as registration, guidance and permissions. We agree with Stuart Etherington of the National Council for Voluntary Organisations that in the past the commission sometimes blurred the distinction between being the regulator and being a friend of the sector. Getting the balance right is not particularly easy, but I am confident that the commission’s current leadership will try. The lack of guidance would create risk for the sector, but the commission’s guidance is well regarded and much has been done to simplify it.
The hon. Member for Ilford North briefly mentioned the commission’s need for extra resources to do its job. It has said that the powers would help it to undertake its compliance and enforcement work more efficiently, which is one of the reasons why we are introducing them. Gaps and weaknesses in the commission’s existing legal powers have occasionally frustrated its efforts to tackle abuse, resulting in delays and wasted costs that the Bill will help to minimise. We are helping the commission to become more efficient and to use its resources better than in the past.
A wider point was made about the amount of money that the Charity Commission receives. Obviously, all parts of Government need to contribute toward efficiency, and that includes the Charity Commission just as much as everyone else. Nevertheless, we recognise the need for targeted additional resources. In October we announced an extra £1 million of funding for 2015-16 and a further £8 million in capital investment between now and March 2017. That will be spent on technology and front-line operations, which will allow the commission to deploy its resources more effectively to prioritise its work.
I am sorry, but I do not support amendment 2. I hope the hon. Member for Redcar will understand that in practice, in the vast majority of cases, the commission will give sufficient notice, which I would expect to be 14 days. That will be set out in guidance that will enable some flexibility for particularly urgent cases. On that basis, I hope that she will not push the amendment to a vote.
Anna Turley
I thank the Minister and everyone who participated in the debate. There is a wealth of experience in this room from within the sector and on the frontline, which does credit to this place and has informed the debate. I echo colleagues’ sentiments about charities’ fantastic work in local communities, in particular their work with the most deprived in some our most challenged communities. We appreciate the work that trustees do and the value that they provide while giving up so much precious time. In the spirit of working with the Government on the Bill, we hope that it will, through better support and guidance, allow trustees and charities to develop their role and create a better regulatory environment.
I am reassured by everything the Minister has said, but we will continue to want to iron out some issues throughout the Bill’s proceedings. While the vast majority of charities abide by the regulations and work incredibly hard to fulfil the criteria, I agree that our attitude cannot be that charities can do no wrong. Equally, our attitude cannot be that charities can do no right. Charities may have felt somewhat beleaguered over the past few months as a result of some media campaigns, so it is important that we send a message that we want to support them in doing the right thing. Some concerns remains, however. The Minister said “proportionate” a lot, and we are putting a lot of trust in the Charity Commission to decide what is proportionate. While I welcome his notification that the commission will set out in guidance the timeframe for issuing warnings, I look forward to seeing the detail.
Wes Streeting
The Opposition’s amendment specifies a 14-day window before a warning notice could be issued. Is my hon. Friend aware that several voices in the voluntary sector say that that does not go far enough, but that what she has proposed is a sensible compromise that gives flexibility and fair notice?
Anna Turley
My hon. Friend is absolutely right. We received many representations from the charity sector suggesting that 28 days was the preferred option. We thought that 14 days was sufficient to give people the chance to notify trustees and to take immediate action to challenge concerns. The amendment is fair and I hope that the commission will consider our 14-day proposal as a good timeframe when setting out its guidance, so we look forward to seeing the detail.
I also look forward to exploring some of the Minister’s examples of when action must be swift and what steps the commission will take in such circumstances. I am also glad that the sector will be able to contribute during the consultation period. In the light of the safeguard of this being proposed by the commission and the constructive discussion with the Minister, I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Anna Turley
I beg to move amendment 1, in clause 1, page 2, line 15, at end insert—
‘(2) In Schedule 6 to the Charities Act 2011 (appeals and applications to Tribunal) insert in the appropriate place—
“Decision of the Commission to issue a warning under section 75A to a charity trustee, trustee for a charity or a charity | The persons are— (a) the charity trustees of the charity; and (b) (if a body corporate) the charity itself. | Power to quash the decision and (if appropriate) remit the matter to the Commission.”’ |
The Bill gives the Commission a power to issue an official warning to a charity or trustee where it feels there has been a breach of trust or duty or other misconduct or mismanagement. This amendment ensures the right of a charity to appeal the warning to the Charities Tribunal.
The Bill still does not give sufficient protection to charities facing a warning from the Charity Commission under clause 1. I have obviously listened carefully to the Minister’s explanations, but I want to continue to probe some of the remaining lack of clarity.
The amendment is intended to provide a right of appeal to the charity tribunal when a charity feels a warning has been inappropriately or unfairly issued. All that is required for the commission to issue a warning is for it to consider that there has been a breach of trust or duty or some other misconduct or mismanagement. We have had some discussion today about defining that, but it is still a broad description. It is entirely possible for the commission to issue a warning on the strength of a relatively low-level concern about a charity. The word “proportionate” has been used often, and we have talked about the potential for charities to make mistakes, but we must be aware that the commission could also make mistakes. It is important that charities have a right of redress to enable them to take up concerns if they feel that a warning is unfair.
More significantly, it is entirely possible that there may be disagreement between trustees and the commission as to whether there has been a breach of trust or duty, and therefore whether the issuing of a warning is justified, particularly in non-statutory or best practice matters. For example, a letter from the commission’s chief executive to the Public Accounts Committee in September 2015 states:
“If trustees cannot justify why they haven’t followed good practice, the Commission is likely to treat this as misconduct or mismanagement.”
It is therefore important to attach a safeguard to the issuing of a warning, to allow for the essential right of appeal that the amendment would achieve.
Jo Stevens
The Government have been reducing access to judicial review proceedings, which is another reason why this is of particular concern.
Anna Turley
My hon. Friend makes an excellent point. We know that judicial review is pretty much inaccessible without legal assistance, and that cuts to legal aid have had a hugely detrimental impact on people who are trying to access justice.
Robert Jenrick
The hon. Lady is making a good point. Doe she agree that perhaps the best way to tackle that problem is through guidance from the Charity Commission? If the Care Quality Commission issues a warning, there is no formal way to appeal against it, but in the guidelines there is a 10-day period in which representations can be made to the CQC, which happens all the time. Then the CQC, having read the representations and at its discretion, can withdraw its warning.
Anna Turley
The hon. Gentleman makes an excellent comparison, but what happens if, at the end of that representation, the Charity Commission does not agree? Where is the right of redress or recourse after that? Judicial review is too large, bureaucratic and expensive. It is a complex, time and resource-intensive activity that is largely inaccessible without legal assistance. It is widely known as the remedy of last resort for public body decisions when all other avenues of appeal have been exhausted.
There may be a perception among the public that charities should not use their funds to pursue judicial review applications, in particular in the light of some of what we have seen in the media in the last few days about how charities spend their money, which goes against the grain of what we are trying to encourage. It has been said that if it were possible to appeal against a warning, the commission might be reluctant to issue warnings full stop, as there would be a risk that appeal after appeal would gum up the system. This implies an awareness that judicial review is not really a remedy, as it so much more costly, complex and inaccessible than an appeal to the tribunal. In any event, research suggests that of the 103 inquiries opened by the commission between April 2014 and April 2015, no more than 5% were appealed to the tribunal, which is not a significant proportion. If the warning power is meant to be only for low-level issues but could precipitate adverse publicity—we have already discussed that at some length this morning—and the exercising of the commission’s protective powers, it is illogical that it should be more difficult to challenge than the exercising of the commission’s more extensive regulatory powers, such as the power to remove trustees, which can be challenged in the tribunal.
It is also worth noting that there seems to be confusion over whether the warning power can be used for low-level or medium-level concerns. When the power was first suggested, the Cabinet Office said that it would be for medium-range abuses, for which the commission’s protective powers could be used but it is not likely to be proportionate to do so. Yet the explanatory notes to the Bill say that it will be used where the risks are relatively low. There is still a huge lack of clarity about the difference between a medium-range and a low-level concern. The possible implications of a warning, as we know, are harsh for low-level matters, so it is important that charities have a right of redress and recourse to a tribunal. Without it, they might be unable to disprove what could potentially be false allegations. We also want to ensure that the Charity Commission considers warnings extremely seriously before issuing them.
Mr Wilson
I am grateful to the hon. Lady for her explanation of this amendment. I have already explained our thinking behind the official warning power at some length, and I do not intend to repeat it now, the Committee will be relieved to hear. I will try to be brief, but I do want to explain our thinking on why we propose relying on a representations process and judicial review as the means to challenge an official warning, rather than a right of appeal to the tribunal.
To use a footballing analogy, I consider official warnings to be like a yellow card, whereas statutory inquiry and the corrective and remedial powers that follow are more of a red card. It is absolutely right that the commission’s protective and remedial powers are subject to rights of appeal to the charity tribunal, but I do not accept that the warning power is in the same category.
Clause 1 provides for the commission to give notice of its intention to issue an official warning and for a period for representations to be made, which the Charity Commission will be obliged to consider before deciding whether to proceed with issuing the official warning. There is then the option of judicial review of the commission’s decision. We consider that that is proportionate in the sort of low-level yellow-card cases in which an official warning would be issued. It is exactly the same as the current position when the commission publishes details of its operational compliance case reports into non-inquiry cases that have attracted public interest and highlight important lessons for charity trustees.
The problem the commission currently has is that in between 20% and 30% of those non-inquiry cases, its advice and guidance is simply ignored, or the issues are not rectified in full. We believe that a right to appeal an official warning to the charity tribunal would be disproportionate and could render the power impractical for its intended purpose, which is to enable the commission to respond proportionately to the low-level non-compliance, misconduct or mismanagement that sometimes take place. The commission has told me that the resources required to defend tribunal proceedings would be disproportionate to the issues at stake in official warning cases, rendering the official warning power unusable from the commission’s perspective. The last thing I want to do, as I have said, is to give the Charity Commission powers that it cannot use because they are too bureaucratic, and that it could be criticised for failing to exercise several years down the line.
The Joint Committee on the draft Bill looked at the issue in some detail and agreed with us, stating:
“Although we note the arguments by some that the issue of a warning should be subject to appeal to the Tribunal, we see the practical difficulty this would present to the Commission as disproportionate to the benefits of doing so. On the assumption that the Government agrees to our recommendation that the necessary details be added to the face of the Bill, we are satisfied that the issuance of a warning does not need the further safeguard of an appeal beyond the ability to seek judicial review.”
It is important to point out that if the Charity Commission sought to escalate matters when an official warning had been ignored, by opening a statutory inquiry, the opening of the statutory inquiry would itself be subject to a right of appeal to the charity tribunal. Similarly, if the commission were to exercise one of its protective or remedial powers, that would also be subject to a right of appeal to the charity tribunal, so there are already two layers of appeal rights when a statutory inquiry is involved. It would seem wrong to add another layer of appeal to the tribunal in the case of an official warning, which could be used to frustrate commission regulatory action.
The Charity Commission has a high success rate on appeal—there were no successful appeals to the tribunal against the commission’s decisions to open a statutory inquiry in 2014-15. That shows that the concerns that some have expressed about the commission’s decision making are not based on reality. The issue for the commission is the amount of work and time that each tribunal case takes, even when it does not have merit. In 2012-13 appeals were made to the tribunal in five cases, and in 2014-15 appeals were made in 32 cases. The judicial review system is much better set up for setting right genuine wrongs, while discouraging or disposing of cases that are unmeritorious or that have been brought with the calculation that delay through litigation is the best tactic for avoiding robust regulation.
The requirement in clause 16, which I urge members of the Committee to look at if they have time, for a review of the legislation to begin within three years of enactment, will provide a timely opportunity to review the commission’s exercise of the official warning power and any judicial reviews of its exercise of that power.
The hon. Member for Redcar made a couple of brief points, one of which was about judicial review being costly and inaccessible. The administrative court judicial review system is much better set up for dealing with the concerns that are expressed—for putting right genuine wrongs, as I have mentioned—because there is a filter system. The tribunal, unlike judicial review, does not have a filter system in which the court’s permission to go ahead is sought. Cage is a recent example. The High Court refused permission on two of the three grounds, avoiding the spending of significant amounts of time on complex human rights arguments that were not arguable.
As for costs, a system such as that of the High Court, where costs are usually paid by the loser to the winner, can act as a sensible deterrent, encouraging parties on both sides to act reasonably and in accordance with the overriding objective.
Another question from the hon. Lady was whether the provision amounts to a direction power. The answer is no, it does not. An official warning is not the same as a direction power. The Government agreed with the Joint Committee’s recommendation to set out more detail in the Bill about the content of an official warning, including that the commission should specify how a charity should rectify any breach.
In some cases, such as a failure to file accounts, it will be obvious how a breach can be rectified. In others it will be less clear, and it is important for the commission to be able to set out guidance on the actions it considers necessary to remedy a breach. Ultimately, however, it will be for the charity’s trustees to decide how they will remedy a breach and then to demonstrate that they have done so effectively. A warning cannot force charities to take a particular course of action.
I think I dealt earlier with why there is no appeal in relation to warnings, so I shall not do that now. I hope that the hon. Lady will be persuaded to withdraw the amendment on the basis of my response.
Anna Turley
I thank the Minister for his thorough and helpful response. Again, we will not press the matter to a vote, but we still have significant concerns. As a football fan I liked the Minister’s metaphor about yellow cards, but with a yellow card there is no immediate repercussion other than having to be a bit more careful about the next tackle. For a charity, there are potentially quite damaging repercussions of a warning, particularly given the public notification. There could be an impact on a charity’s ability to fundraise, its reputation and its ability to find trustees. Those are wide-ranging implications, and something of such seriousness needs to be able to be challenged.
We still have not come to a conclusion on that point. I take the Minister’s point about the lack of error making so far in the Charity Commission’s decisions, and I commend it for that, but that is not to say that it will always be perfect. The point about warnings is that they are more low-level, so the likelihood of error is going to be substantially lower. As yet, there is no means of redress, other than judicial review, if a warning has been incorrectly given or if it is subsequently found that the Charity Commission did not abide by due process. Judicial review seems hugely disproportionate, particularly in the case of smaller charities, for what seems like the small issue of a warning. There ought to be proper discussion about different means of redress and a way of allowing a charity to challenge the Charity Commission formally.
We will not press the amendment to a vote, and I appreciate the Minister’s point that the Commission will be setting out further information in its guidance. I also welcome the Minister’s acknowledgement that the Charity Commission cannot force charities to take a particular course of action on the back of a warning. That is a welcome message to the sector. Of course, people will want to rectify any errors or issues that have led to a warning being given. I am sure many will want to guard their ability to decide the future of their charity and not be directed on how to run it by the Charity Commission. I look forward to seeing more from the Charity Commission on how it intends to ensure that.
We look forward to working through further clarification away from the statute book, but on the basis of the Minister’s comments I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Chair
As I said earlier, we will not be having a debate on clause 1 stand part.
Clause 1 ordered to stand part of the Bill.
Clause 2
Investigations and power to suspend
Question proposed, That the clause stand part of the Bill.
Anna Turley
Clause 2 sets out the powers for the Charity Commission to take action where a charity fails to remedy a breach as specified under a warning. Our amendment 3 sought to ensure that where a warning had been challenged through the charity tribunal the charity was not automatically able to take action under clause 2. Given that we withdrew our previous amendment, I decided not to move amendment 3, because it was pursuant on a charity tribunal.
Mr Wilson
I hope it will help if I briefly explain the purpose of clause 2. As the amendment has not been moved, I will not respond to it.
Clause 2 does two things. Firstly, it puts beyond doubt that failure to comply with an order or direction of the commission, or failure to remedy a breach specified in an official warning, constitutes misconduct or mismanagement. Second, it enables the commission to extend a suspension pending removal by up to one year, subject to a two-year overall limit.
I will deal with extending suspension first. The commission requested the extension to its existing suspension power because in some cases it must await the outcome of a criminal investigation before it can proceed with its regulatory action, and in some cases that can take a significant amount of time. In giving evidence to the Joint Committee on the draft Bill, Detective Chief Superintendent Terri Nicholson highlighted a recent case where a suspension had come “very close” to expiring under the 12-month limit while a criminal trial was ongoing.
I will provide the Committee with two other examples of when the commission may be required to extend a suspension, as envisaged under clause 2. The first is where the commission is notified of serious regulatory concerns in a charity relating to significant governance failures and the failure to account for a large sum of charitable funds. An action for civil recovery is initiated by a debtor to the charity and takes more than one year to settle, during which time the commission is only able to suspend the trustees for up to one year and cannot take further regulatory action that could prejudice the ongoing litigation.
Another example is a trustee of a charity that looks after children being charged with multiple offences against the person, some of which include offences against young people. Due to the complexity of the case, the trial does not take place for 16 months after charge, after which the case is thrown out on procedural default. The commission would not be able to extend suspension of the trustee beyond 12 months as things stand, despite the clear risk the individual may present to the charity’s beneficiaries. This provision allows the commission fully to carry out its regulatory role, as it will not be restricted by waiting for the outcome of a prosecution, while the two-year overall cap on a suspension presents an appropriate safeguard.
I now come to the provision that effectively deems misconduct or mismanagement where there is a failure to rectify a breach identified in an official warning. The provision simply makes clear that certain failures will constitute misconduct or mismanagement, which enables the commission to move to open a statutory inquiry and gives it access to temporary protective powers. It will help the commission in escalating cases in which the trustees fail to address the issues, as the commission will no longer need to make the case every time that such failures constitute misconduct or mismanagement.
Where an official warning identifies a breach to be remedied, it will be for the trustees to determine how to remedy that breach. The commission can provide advice and guidance for trustees, but it will be their responsibility to decide how to remedy the breach and to demonstrate that it has been properly remedied. Let me at this point make it clear that simply failing to follow best practice cannot, in itself, constitute misconduct or mismanagement. However, trustees must be able to show that they have properly fulfilled their duties, and demonstrating adherence to best practice will sometimes be the easiest way to do so.
Originally, we did not include the provision deeming misconduct or mismanagement in the draft Bill, but the Joint Committee suggested that it be included, provided we accept its recommended changes to the official warning power—most, but not all of which, we accepted. The Joint Committee also recommended that the commission should not be able to rely on failure to rectify a breach set out in the official warning until the period for appealing against the warning has expired, which was the topic of amendment 3. As that amendment has not been moved, I will finish there.
Question put and agreed to.
Clause 2 accordingly ordered to stand part of the Bill.
Clause 3
Range of conduct to be considered when exercising powers
The Chair
The question is that clause 3 stand part of the Bill. As many are of that opinion say, “Aye”.
The Chair
I did ask; no one said anything, but we will go back.
Question proposed, That the clause stand part of the Bill.
Mr Wilson
My apologies, Mrs Main. I missed that—it was all too quick for me. I am a bear with a slow brain.
Clause 3 enables the Charity Commission to take account of a person’s other relevant conduct outside of the charity under inquiry. The provision will enable the commission to consider whether there is evidence of misconduct or mismanagement in other charities or conduct outside charities that could undermine public trust and confidence in charities and therefore ought to be taken into consideration before the commission determines how to act.
On the face of it, that appears to be a very broad power, but it is not. There are significant safeguards, which I will set out. First, there must be a statutory inquiry open into charity A of which the person is a trustee or employee and the Charity Commission must be satisfied that there is misconduct or mismanagement linked to that individual in charity A before it can consider any of their conduct outside the charity as a makeweight in its decision-making. Secondly, the commission, when exercising its powers, must provide a statement of reasons under section 86 of the Charities Act 2011, which would set out all the evidence it relied on in making the decision. This would include any evidence from outside the charity, which must, of course, be relevant evidence. Finally, there is a right of appeal to the charity tribunal in relation to the exercise of the commission’s compliance and remedial powers, ensuring judicial oversight of the exercise of the relevant power.
The Charity Commission could only take account of conduct that would be relevant to the management or administration of a charity and would have to set out in its statement of reasons, under section 86 of the Charities Act 2011 or under the new official warning power in clause 1, the conduct that it was taking into account in decisions to exercise any compliance powers. The Charity Commission would not be able to take into account any conduct that was not relevant to the management or administration of a charity.
Let me give an example of when the commission would expect to rely on this power in practice. Allegations are made against an individual who is a trustee of charity A about abuse of vulnerable beneficiaries in a charitable care home. The Charity Commission opens a statutory inquiry and determines that there has been misconduct by the trustee. During the course of the commission’s inquiry, other regulators provide the commission with evidence of past misconduct that resulted in the individual’s employment in a care home being terminated. The commission would be able to take this other evidence into account before making a decision on what action would be proportionate in the circumstances.
As things stand, the commission would be able to give no weight to this other evidence of unacceptable conduct. Another example could involve an individual who is a trustee of two charities, charity X and charity Y. He may have been involved in misconduct in charity X and the commission may have already taken action in relation to charity X. The regulator may then have concerns about similar misconduct taking place in charity Y but, as the law stands, the commission cannot take into account the individual’s track record from charity X. This provision would enable the commission to do so.
We made amendments to the Bill in the other place to modernise the language of this provision and others in the Charities Act 2011. These changes were suggested by Lord Hope of Craighead, who chaired the Joint Committee and is a former deputy President of the Supreme Court. He argued, rightly, that there is no place in the 21st century for the term “privy to”. It was used in the Bill and the 2011 Charities Act to identify trustees who knew about misconduct or mismanagement but turned a blind eye. We have now replaced the term “privy to” with,
“knew of the conduct and failed to take any reasonable step to prevent it”.
That is much better for the understanding of the lay reader of the legislation, which is something we must bear in mind when we consider that trustees are almost all volunteers. This clause makes sensible changes that will help the commission with its compliance casework, and I commend it the Committee.
Anna Turley
I thank the Minister for that thorough and detailed explanation. He will be aware that we have tabled no amendments to this clause because we fully support it. It has been through a great deal of pre-legislative scrutiny and scrutiny in the other place, so we support that the clause stand part of the Bill.
Question put and agreed to.
Clause 3 accordingly ordered to stand part of the Bill.
Clause 4
Power to remove trustees etc following an inquiry
Question proposed, That the clause stand part of the Bill.
Mr Wilson
Clause 4 basically does two things. First, it amends the existing power in section 79 of the Charities Act 2011 to allow the Charity Commission, in the course of an inquiry, to establish a scheme in relation to a charity. A scheme is a legal document made by the commission which can amend, replace or extend the trusts of a charity. It can set out new objects and purposes for a charity or amend or remove a prohibition or restriction.
Under the current law, the Charity Commission can make a scheme only where there is evidence of misconduct or mismanagement and a need to protect charity property or secure its proper application. Clause 4 would change that so that the Charity Commission can make a scheme where there is either evidence of misconduct or mismanagement or a need to protect charity property or secure its proper application. The commission considers this change to be necessary to enable it to take action in some cases where only one of the limbs can be demonstrated, but where commission action is necessary. Let me give two examples.
Anna Turley
As with the previous clause, we support this measure. We believe it will give the Charity Commission an important power to safeguard the integrity of a charity, particularly its public profile. Misconduct and mismanagement are extremely serious and should be taken extremely seriously. As the Minister identified, the ability to address this loophole has long been missing from the Charity Commission’s powers. Representatives of the sector have not raised concerns with us about this proposal. They understand it is an important opportunity for them to protect themselves against misuse and abuse. On that basis, we are happy to support the clause.
Question put and agreed to.
Clause 4 accordingly ordered to stand part of the Bill.
Clause 5
Power to remove disqualified trustee
Question proposed, That the clause stand part of the Bill.
Mr Wilson
Clause 5 would insert into the Charities Act 2011 a new section 79A to enable the commission to remove a disqualified charity trustee if they continue to remain in their position once disqualified.
The clause aims to close a loophole in the current legislation. The Charity Commission does deal with cases where a trustee knows that he is disqualified, but that he does not commit a criminal offence unless he “acts” as a trustee and so remains on the charity’s books as a trustee, but maintains that he does not “act” as one.
Under the law as it stands, in those circumstances the commission sometimes has to put pressure on disqualified individuals to step down from their trustee position. An example of where that may be necessary is where a trustee is disqualified by virtue of bankruptcy pursuant to section 178 of the Charities Act 2011. However, disqualification does not automatically remove the person from the position of trustee. Similarly, the charity’s governing document does not remove the individual either. In those circumstances, the commission or trustee body has to try to secure the resignation of the individual.
Mr Wilson
I will finish this paragraph and then give way.
The individual might refuse to co-operate and not resign, which means that the trustees may not be able to operate quorately or appoint new trustees. If the disqualified individual continues to maintain their position, that will open them up to potential criminal and civil liability, but that does not help the charity to move forward. This new power would enable the commission to remove the disqualified trustee in order to allow the charity to continue to function.
Peter Kyle
I apologise for interrupting the Minister mid-flow; I thought he had reached the end of the paragraph. Perhaps those drafting his speeches are putting too much into one sentence.
I agree wholeheartedly with the intentions behind the clause. Will the Minister inform the Committee how frequently it is expected the powers will be used? It strikes me as being a rare occurrence that somebody would be declared bankrupt and yet not voluntarily stand down from a charity. I do not know of any such case.
Mr Wilson
I know that my officials like to pack a lot into my speeches, so they have longer paragraphs. Obviously it is important that we have proportionality. This is the sort of issue that arises dozens of times a year, so it is a regular occurrence and we need to take action to try to control and eradicate it.
Another example might be where a charity trustee is disqualified by virtue of having been convicted of theft. The person refused to resign his position, which was problematic for the charity because it affected their quorum for business and decision-making purposes and there was no power to remove a trustee within the charity’s constitution. The trustee board is already at its maximum size and is unable to act further. This new power would allow the commission to remove the trustee so that the charity can continue to operate quickly and safely.
The commission has estimated that the power would be used dozens of times each year to remove people who were refusing to stand down even when they had been told they were disqualified. This indicates that there is an issue to deal with. It is important to equip the commission with powers to take steps to remove a disqualified trustee from their role quickly and effectively. The new power was welcomed by the Joint Committee on the draft Bill and I commend it to the Committee.
Anna Turley
I thank the Minister for that full and thorough explanation. As trustees of charities—which many members of the Committee are—many of us feel it is important to fulfil our duties fully and with confidence, should a fellow trustee board member not fulfil their duties and be disqualified as a result. The Charity Commission’s standards for disqualification are high—it has set the bar at a good level. We wholeheartedly support the clause because we think it is in the best interests of trustees around the country. They want the integrity of their boards protected, and it is important that those who have been disqualified can be removed, because trustees often do not have the ability to do so themselves. The clause gives more powers to the Charity Commission, but we wholeheartedly support them and we know it will use them wisely.
Question put and agreed to.
Clause 5 accordingly ordered to stand part of the Bill.
Ordered, That further consideration be now adjourned. —(Sarah Newton.)
Charities (Protection and Social Investment) Bill [ Lords ] (Second sitting)
(8 years, 4 months ago)
Public Bill CommitteesRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Anna Turley (Redcar) (Lab/Co-op)
I beg to move amendment 4, in clause 6, page 5, line 2, at end insert—
‘(4) An order under this section will automatically be discharged on the closure of the inquiry under section 46 which is referred to in subsection (1).’
To restrict the power to ensure that if a tribunal appeal is successful, a direction by the Commission as a result of the warning is no longer relevant.
I welcome the clause, which inserts a new provision into the Charities Act 2011 to enable the Charity Commission, after it has instituted an inquiry, to make an order directing a charity not to take or to continue certain actions that the commission considers constitute misconduct or mismanagement in the administration of the charity. The order has to specify the action that must not be made or continued, and has to set out the commission’s reason for making it. The commission will have to review any order at intervals of not more than six months and there will be a right of appeal against the order.
When the Joint Committee on the Draft Protection of Charities Bill suggested that it would be helpful if the Government chose to revisit proposal 13, it set out that the provision must be tightly drawn to clarify the circumstances in which the power can be used and the safeguards that apply, in particular the right of appeal. The previous Government accepted the Joint Committee’s recommendation and said that they would revisit proposal 13 for inclusion in the Bill—that is now clause 6. I look forward to the Minister setting out some examples of the circumstances in which the power may be used and any safeguards. I am pleased to see the right of appeal.
The new power in the clause is broadly similar to a power that the Office of the Scottish Charity Regulator has to direct that specific action is not taken. However, the OSCR’s power may take effect for a maximum of six months. There is no such limit under clause 6, although the Charities Commission must review the order at intervals of not more than six months.
The crucial issue, to which my amendment speaks, is that it is not clear whether the order may remain in place once a section 46 inquiry has been closed, so it could extend beyond the period of the inquiry. The amendment seeks to prevent that. The Charity Commission states:
“The purpose of an inquiry is to examine the issues in greater detail and investigate and establish the facts of the case so that the commission can ascertain the extent of any misconduct or mismanagement, establish the extent of the risk to the charity, its work, property, or beneficiaries, and decide what action is needed to resolve the concerns. If the allegations are not substantiated, the inquiry will say so. The ultimate aim is to stop abuse, ensure compliance and put a charity back on a secure footing. Where this is possible it may include restoring its reputation, protecting beneficiaries or assets and protecting and enhancing the reputation and public confidence in the charitable sector generally.”
That is all right and proper, and we agree with the Charity Commission’s view on the purpose of an inquiry. Once the inquiry has concluded, an order made under clause 6 should no longer be relevant and the findings of the inquiry, whether allegations are substantiated or not, should take precedence. Directions that have been given during the process of an inquiry, but which are not in keeping with the outcomes, should not be pursued.
The commission has recently clarified the fact that it has no power to require trustees to fetter the future exercise of their fiduciary powers under its general power to give advice and guidance, which appears in section 15 of the Charities Act 2011. That clarification followed judicial review proceedings in the High Court, where it was alleged that the commission had attempted to do exactly that. This is one of the concerns that we expressed earlier in the debate, and it could apply in particular to the commission’s powers to specify action that should be taken to rectify misconduct or mismanagement under clause 2.
There are situations in which the commission may direct trustees to act or not to act—clauses 6 and 7 introduce more such situations—but they are always carefully circumscribed. It is therefore extremely important that we are satisfied that the definition of such powers is carefully discussed, that their gravity is understood and that they do not continue beyond an exhaustive inquiry. That is why I moved the amendment.
The Minister for Civil Society (Mr Rob Wilson)
The clause is a sensible extension of the existing powers of the Charity Commission that are available to it when it is conducting a statutory inquiry under section 46 of the Charities Act 2011. At the moment, when a statutory inquiry is under way and the commission is satisfied that there has been either misconduct or mismanagement, or that there is risk to charity property, it may direct a charity to undertake certain actions under section 84 of the Act. The purpose of the existing section 84 power is to allow the commission to direct any action to be taken that it
“considers to be expedient in the interests of the charity.”
Legal precedent confirms that “expedient” in that context means advantageous or beneficial, so the action that the commission proposes will be of advantage or benefit to the charity’s interests, which in effect means the charity’s beneficiaries. However, the advantage or benefit must be viewed only in the context of the issues raised through the inquiry and not in the belief that it would be good for the charity in general terms. Specific examples of where the commission already uses that power include ordering a charity to undertake a governance review in a defined period; review a legal agreement; provide specified documentation by a certain date; ensure that a named individual is monitored on charity premises at all times; draw up a risk management procedure in a certain timeframe and implement that procedure; and take legal advice in connection with a matter concerning the charity and its funds.
Published figures in “Tackling abuse and mis- management: 2013-14” show that the commission used that power to direct charities on 38 occasions. As we have discussed, the commission has been exercising its power more often and more effectively, so we may well see that figure increase in the report for 2014-15, which will be published in the coming weeks.
The power to direct a charity to do something is long held and the commission has well-established procedures and policies in its armoury. The commission also has the power under section 76(3)(f) of the Charities Act 2011 to restrict a charity from undertaking certain financial transactions. That existing power can be exercised in a number of ways, including freezing a charity’s bank account; requiring the charity’s trustees to seek commission approval before entering certain transactions; and preventing specific transactions. That was used on 15 occasions in 2013-14.
The commission does not have the power to prevent a charity from undertaking actions or activities that would amount to misconduct or mismanagement during the course of a statutory inquiry. That is a loophole and the clause is a common-sense addition that will give it that power.
Some people have expressed concern that the commission could use that power to undermine freedom of association or freedom of speech, in particular for charities with religious purposes, but it is important to point out that it would be available to the commission only to prevent activities that would constitute misconduct or mismanagement were they to go ahead or continue. Therefore, if a charity engaged in unlawful political activity such as supporting a political party and holding partisan events, the Charity Commission could act to prevent further such activity from taking place.
It is worth pointing out, as the hon. Member for Redcar did, that the commission’s equivalent in Scotland, the Office of the Scottish Charity Regulator, has a similar power. Section 28 of the Charities and Trustee Investment (Scotland) Act 2005 enables the OSCR to
“direct any charity, body or person with regard to which it is making inquiries…not to undertake”
specific activities for a period of six months. The OSCR may seek a court order for longer restrictions.
The Joint Committee supported the inclusion of such a power, provided that it was tightly drawn to clarify the circumstances in which it could be used, along with the safeguards that applied, particularly the right of appeal. The new power in the clause will enable the Charity Commission to intervene to prevent misconduct or mismanagement from taking place rather than having to watch powerlessly, then take remedial action once the damage has been done.
The bar for exercising the power will be high and there will be six specific protections. First, the power can be used only in the context of a statutory inquiry. Secondly, the commission will have to be satisfied of the need to prevent misconduct, mismanagement or risk to charity property. Thirdly, the commission must set out a statement of reasons for exercising the power and review any order regularly—at least every six months. Fourthly, the making and every review of the order will be subject to a right of appeal to the Charity Tribunal and, like all its other protective and remedial powers, this power is subject to the Commission’s duty to act proportionately under section 16 of the Charities Act 2011.
Let me give the Committee two examples of cases in which the powers might be used. In recent years, there have been several cases of charities involved in the abuse of charitable business rates relief. In such cases, the so-called charity enters into multiple tenancy agreements with commercial property owners at reduced rents without any real evidence that the tenancies are in the best interests of the charity or are used meaningfully for charitable purposes. Once occupied by the charity, the property benefits from a reduction of at least 80% in business rates relief, which can be a substantial sum. The saving is often shared between the charity and the property owner. Local councils and honest taxpayers end up losing out. The commission has taken action in such cases, but it can do so only after the event. The new power would enable the commission to direct the charity not to enter into, renew or continue any further tenancies, in effect preventing the misconduct from continuing.
Another example in which the power could be used would arise if a charity had made significant loans to companies connected to the trustees. The trustees would seek to become insolvent and to wind up the charity, writing off the loans and resulting in significant financial benefit to the companies connected to the trustees. In that case, the commission would be able to use the new power to direct the trustees not to wind up the charity, buying time to sort things out by, for example, removing the trustees, or appointing new trustees or even an interim manager to act in the charity’s best interests, which could involve calling in the loans.
Jeremy Lefroy (Stafford) (Con)
It is a pleasure to serve under your chairmanship, Mrs Main. I am interested in the Minister’s example of charity shops having 80% or more discount on their business rates. I came across an instance recently of a thriving and popular business effectively being told by the landlord to move because they wanted to put in a charity shop which was offering a higher rent than that popular business. Part of me thinks that that might be the result of a charity being able to pay a higher rent because it does not pay any rates. How would the amendment affect that?
Mr Wilson
I take the point made by my hon. Friend, but I really do not think it is a matter for the Bill. He may want to raise it with the Chancellor or the Secretary of State for Business, Innovation and Skills. I do not think it is for me to deal with it today.
Some people have argued that it should not be possible for the power to extend beyond the life of a statutory inquiry, and I think that is what the amendment of the hon. Member for Redcar seeks to prevent. However, the hon. Lady may be seeking to do something slightly different, as her explanatory statement for the amendment suggests that she wants a direction to cease following a successful tribunal appeal. I can assure her that if such a direction were appealed it would be for the tribunal to decide what would happen—for example, whether the direction would be quashed, remain in place or remitted to the charity commission to be reconsidered. If the hon. Lady is concerned that the commission could exercise the power following an official warning, let me remind her that it could be exercised only when a statutory inquiry had been opened, which itself could be appealed to the Charity Commission.
Let me explain why I think that it should be possible for a direction to remain place beyond the life of a statutory inquiry, although not indefinitely. The power to direct action not to be taken is a temporary protective power for the Charity Commission. That is why it is subject to review at least every six months, so that the commission can confirm whether it considers it necessary for it to remain in force. That process would be subject every time to the commission’s duty to act proportionately and to the right of appeal to the charity tribunal.
The power is not a permanent, remedial one designed to address the underlying issues, which may need to be addressed by the exercise of other commission powers, including removal of trustees. It is designed to prevent specific further misconduct or mismanagement from taking place once a statutory inquiry has been opened, but those individuals need to know that the power can remain in place for sufficient time so that they do not simply decide to wait for six months before attempting the misconduct again or allowing the mismanagement to occur again.
Anna Turley
I thank the Minister for his helpful response. It was extremely important to hear his clarifications, particularly about the six protections that will be in place before the power is used, and the clear and helpful examples he gave of instances in which the power will be used.
The amendment relates not to the warnings and the tribunal dealt with in clause 1 but to whether the power will continue if it is used in the course of a formal inquiry, subject to the inquiry’s final outcome. I was reassured to hear that the inquiry’s outcome and the report’s findings will take precedence in the action going forward. It is extremely important that if allegations made in the course of the inquiry are unfounded, they are quashed and no further action is taken. We also wanted to know whether, if the inquiry report showed structural issues and there was a remedy that affected those issues, that would overrule the temporary protective amendments. The Minister clarified that issue, for which I am grateful. I am reassured by his response, so I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 6 ordered to stand part of the Bill.
Clause 7
Power to direct winding up
Question proposed, That the clause stand part of the Bill.
Mr Wilson
We are progressing through the Bill at a rate of knots, so I will try not to delay the Committee too long. The Charity Commission’s usual practice, as many of us will know, is to try to restore a charity to health following a statutory inquiry and to ensure that funds dedicated for specific charitable purposes are used for those purposes. The commission’s current powers are based on that premise; that is as it should and, indeed, will continue to be. In practice, that may mean replacing some of the trustees, directing the charity to take certain actions or reforming its governance arrangements, but the principle is one of ensuring the continuation of the charity to deliver its charitable purposes.
There are, however, rare inquiry cases where it is more appropriate for the commission to take a different approach. In those cases, it is clear that attempting to restore the charity to health is unlikely to succeed and would not be the right strategy. A good example would be sham charities set up ostensibly for charitable purposes but really operating for private gain or some other non-charitable purpose. Such a body may never have had a genuine charitable aim in the first place and the commission is unlikely to be able to restore it to health.
In such cases, the Charity Commission can and already does act to transfer any remaining funds or assets to another legitimate charity with the same charitable purposes. It can do this under its existing inquiry powers. The commission can remove the trustees, ensuring their disqualification, provided that they do not resign before the commission can do so. What the commission cannot do under its current powers is tackle the empty shell that is left, so there is a risk that the empty shell could be reactivated at a later date to be used for further misconduct.
Wes Streeting (Ilford North) (Lab)
Will the Minister give the Committee a sense of the scale of this problem? How many charities does the commission intend winding up in any given year?
Mr Wilson
I will certainly ask the Charity Commission to make sure that the hon. Gentleman has those figures; I hope that that will happen by the end of my comments, but if not, it will be straight after. [Interruption.] That is quite impressive—I thank my officials. I can tell the hon. Gentleman that there will be one or two such occasions a year.
The new power in clause 7, which I admit is quite a straightforward power, will enable the Charity Commission, in the context of a statutory inquiry, to act to transfer any remaining assets of the charity under inquiry to another charity with the same charitable purposes, something the commission can already do under its existing powers, and then—this is the new provision—direct that the empty shell of the charity be wound up, which it cannot currently do. This power will be rarely used by the Charity Commission. The commission estimates it will be exercised on only one or two occasions each year, as I have just said, and it is subject to a range of safeguards.
The power to direct winding up will only be available in the context of a statutory inquiry and where the commission is satisfied that there is misconduct, mismanagement or risk to charity property. The commission must be satisfied that the charity does not operate or that its charitable purposes could be more effectively promoted if it were to cease to operate and that the exercise of this power is
“expedient in the public interest.”
As I have said several times, all the Charity Commission’s powers must be exercised in line with the commission’s duty in section 16 of the Charities Act 2011, which requires the commission to have regard to the principles of best regulatory practice, including the principles by which regulatory activities should be proportionate, accountable, consistent, transparent and targeted only at cases in which action is needed. So there is a high bar for the commission to make the case for winding up following an inquiry.
The commission is required to publish details of a proposed winding-up order and to invite representations from any interested party. The commission must take into account any representations it receives before making the order to direct winding up. In most cases, the commission will be expected to allow 60 days for the making of representations before it can make the order. It can shorten that period when it considers it necessary to make the order sooner to prevent or reduce misconduct or mismanagement, or to protect the charity’s property or property that may come to the charity. An order directing the winding up of a charity can be appealed to the tribunal by its recipient and the charity’s members, so ensuring proper judicial oversight.
The clause will enable the commission to direct the charity’s trustees, officers or employees to take action to wind up that charity. The commission itself cannot wind the charity up, as that would involve the commission acting in the administration of the charity—something that it is prohibited from doing by law. The Joint Committee welcomed the proposed winding-up power, saying:
“We are persuaded that the power to direct the trustees of a charity to wind it up in certain circumstances and transfer resources elsewhere would only be used in rare circumstances and that, in such circumstances, the Charity Commission would use it sparingly, given its significance. We therefore support the inclusion of clause 6 of the draft Bill”—
as it was then—
“subject to an amendment setting out the publication scheme for a notice of intention to direct the winding up of a charity.”
We amended the draft Bill to include the requirement to publish a notice and consider representations, as recommended by the Joint Committee.
Let me give the Committee an example of where this power could be used. The commission has information suggesting that one of only two trustees was acting while disqualified. The finances were being grossly misrepresented, funds were being misappropriated and the commission had been given false or misleading information. It reported its concerns to the police, highlighting potential criminal offences. The disqualified trustee left the charity, leaving only one trustee, who was unable to explain the position. The remaining trustee was potentially vulnerable and had not been privy to the disqualified trustee’s actions. The commission found that the charity had been used for years to personally benefit the disqualified trustee, who was later convicted and imprisoned for theft. It had applied only nominal amounts for its charitable purposes. The commission decided to remove the charity from the register, as it was not operating, but the remaining trustee did not take action to wind up the charity. The commission does not have the power to force the trustee to do so and cannot do so itself. In such cases, the use of the proposed power would clarify the position, provide for the proper application of assets and ensure that the charity could not later restart operations with a risk of further abuse. Although its use will not be common, I hope the Committee will agree that this will be a useful tool in the Charity Commission’s armoury.
Anna Turley
I am happy to take any interventions. We are indeed rattling through these clauses and are the beneficiaries of some excellent analysis of the Bill during its long progress through the other place and in pre-legislative scrutiny. A lot of action has been taken to clarify and improve the Bill. Indeed, it is clear from its drafting that this clause has benefited from much scrutiny.
Clause 7 will provide a new power for the Charity Commission to direct the trustees, or other people in the charity, to take the necessary steps to wind up the charity and transfer its resources elsewhere. The explanatory notes suggest that the power will be used in “rare cases” and state:
“The Commission’s usual practice is to attempt to restore a charity to health following a statutory inquiry”.
We all support the positive and supportive role that the Charity Commission would play. As the Minister said, the commission itself cannot wind up the charity, as that would be acting in the charity’s administration; it can only direct the trustees to do so themselves. That is absolutely right and within the boundaries of the commission’s power. The power would be available after the commission had instituted an inquiry and was satisfied either that there was misconduct or mismanagement, or a need to protect charity property. The commission would need to be satisfied on other matters specified in the clause, including that the exercise of the power was
“expedient in the public interest.”
Again, I fear that a burden of decision making and judgment is being placed on the Charity Commission. Just as the decision on whether to publicise a warning under clause 1 will be taken by the commission, so again we find the commission having to be the arbiters of public interest. I do not doubt that it will perform that duty admirably, but we must be conscious that we are asking it to make another judgment call. That risk should be looked at in the context of an environment in which the commission is under pressure to take action on charities that are threatening public trust and confidence, and to be seen to do so. The recent High Court judicial review case mentioned earlier provides an example of how easy it is for the commission to take precipitate and potentially disproportionate action. I sincerely hope that the commission will use its customary wisdom and good judgment in making these decisions. I was reassured to hear that it is expected to use the power only one or two times a year.
Mr Wilson
Clause 8 should be fairly uncontroversial and, although I do not want to pre-empt the Committee, a fairly short one for us to consider. The clause amends an existing Charity Commission power in section 85 of the Charities Act 2011, which allows the commission to direct the application of charity funds or property when the person holding it is unwilling to apply the property for the charity’s purposes and the commission considers it necessary or desirable to make the order to secure the proper application of the charity’s property.
The purpose of the clause is to extend the power and enable the commission to make an effective direction in cases where the person holding the charity property may be willing but unable to apply the charitable property. The most commons example of this problem is considered to be where financial institutions, such as banks, hold a charity’s property but are unable to comply with a commission direction to transfer that property because to do so without the consent of authorised account signatories would result in a breach of their contract with the charity for which the bank could be held liable.
For example, a number of charities subject to a class inquiry ceased to operate but funds remained in their bank accounts. The commission’s powers relating to dormant accounts could not be used until a certain time had elapsed and there was a risk that the remaining funds could be misapplied by individuals on the mandate. Before the commission could use the power as currently worded, it had to establish that a number of banks were unwilling to apply the funds without an order of the commission. The banks were willing to apply the funds but were unable because of their contractual obligations to the account signatories. Amending section 85 to include “unable” as well as “unwilling” would allow the situation to be resolved swiftly and satisfactorily and the charitable funds to be properly applied for their charitable purposes.
Wendy Morton
I am grateful to the Minister for sharing with us some examples of what the Bill will mean in practice, as he did in our discussion of the previous clause. Does he agree that the clause includes some sensible and proportionate measures that, in the round, are all part of helping to restore the trust that charities have in the public domain?
Mr Wilson
My hon. Friend makes a very good point. The clause is partly about restoring trust. It is also about making the Charity Commission work better and more efficiently and focus its funds on the areas where it can really make a difference—day in, day out. She is absolutely right.
Other barriers may make a person unable to comply with a commission direction of this type, such as restrictions in the charity’s governing document, which may prevent otherwise willing trustees or members from complying with this type of commission order because they are legally unable to do so. The Joint Committee recommended that we consider the inclusion of some form of statutory protection for a financial institution in cases where compliance with the direction from the commission in those circumstances might constitute a breach of its contract with a charity. The clause seeks to remove any obstacles by allowing the commission’s direction to overcome a contractual obligation owed to a charity.
Importantly, clause 8 continues to provide the specific, statutory protection for a financial institution—or, for that matter, any person holding the charitable property—in cases where compliance with the commission’s direction in those circumstances might constitute a breach of its contract with the charity. It is always important to consider the practical application of legislation and the clause will help the Charity Commission make use of the existing power more effectively.
Anna Turley
I echo the Minister’s concluding comments. As well as supporting the Charity Commission, the clause will support many charities that often struggle with individual trustees who may have been unable to take necessary action. This will enable the commission to step in and essentially fill a void where no one has had the power to tackle the issue.
Again, we welcome clause 8. It will amend the power in section 85 of the 2011 Act, which enables the commission to direct the application of charity property, where it is satisfied that a person is unwilling to apply it properly for the purposes of the charity and it is necessary or desirable to make an order to secure the proper application of that property.
The clause will amend section 85 in two ways. First, the commission will now have the power to direct the application of the property, if satisfied that the person is unable to apply it properly, as opposed to being unwilling. I appreciate the Minister’s examples of where that will be applicable. It is helpful to understand the case studies that will ensue.
Section 85 will be amended to ensure that compliance with the order will not result in a breach of contractual obligations to the charity. The explanatory notes and the Minister have provided an example of banks that act on client instruction. That is the most common example of the problem, where financial institutions hold a charity’s property but are unable to comply with the commission direction to transfer that property because doing so would result in a breach of their contract with the charity. That closes an important loophole and enables the Charity Commission and charities themselves to progress with securing the property.
As the Minister showed with his examples, clause 8 will continue to provide the specific statutory protection for a financial institution, in cases where compliance with a Charity Commission direction in these circumstances might constitute a breach of its contract with a charity. We support the clause and welcome it as a useful addition to the Bill.
Question put and agreed to.
Clause 8 accordingly ordered to stand part of the Bill.
Ordered, That further consideration be now adjourned. —(Sarah Newton.)
Westminster Hall
(8 years, 4 months ago)
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Transport for London Funding
(8 years, 4 months ago)
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Mr Gareth Thomas (Harrow West) (Lab/Co-op)
I beg to move,
That this House has considered Transport for London funding.
I wish to express concerns about the impact of the cuts to Transport for London’s funding that were announced in the spending review. I am especially concerned that a future Mayor, or even the sitting Mayor, might want to raise fares, which will hit my constituents particularly hard. I also want to suggest possible solutions to help plug the holes in TfL’s books.
Let me give the context to the Chancellor’s decision. Transport for London runs the public transport services and manages the major road network in the most important city in Britain. London is the gateway to the rest of the United Kingdom. TfL’s work is critical to Londoners’ ability to work and play, and to get to school and hospital; to business’s ability to get its workforce to work and its goods and services to and from customs; and to London’s many visitors’ ability to arrive, leave and travel to other parts of the UK.
London’s population is growing and is projected to rise from some 8.6 million today to about 10 million by 2030 and 11 million by 2050. London is seeing the fastest urban growth of any city in the European Union. Only a relatively small proportion of my fellow Londoners enjoy the luxury of being able to walk or cycle to work. In short, the vast majority of new and existing Londoners will be reliant on public transport.
The pace of the growth in the number of journeys on the tube is rising fast as well, from a growth of 8.7 million in 2010-11 to an expected 11.7 million this year, which is an increase of 26% in only five years. The docklands light railway has seen an even faster rate of growth in usage, up from a growth of some 6.3 million journeys five years ago to an expected 9.6 million this year—an increase of 52%. In only four years, the number of passengers served by TfL has increased by almost 0.5 billion a year; eight out of 10 of the busiest days in tube history were in the past two months alone; and, indeed, the busiest day ever on the tube was 4 December, when almost 5 million passengers travelled on TfL trains.
The need for further investment in London’s tube, rail and bus networks and in its roads is widely recognised. There are already problems safely managing passenger flows. At some locations, peak-time travel is not only uncomfortable, but close to unsafe.
Kate Hoey (Vauxhall) (Lab)
My hon. Friend is absolutely right about the increased use of all public transport. Does he therefore share my concern that TfL, without any genuine consultation—just its normal, old, rubbishy questionnaires that ask the questions it wants the answers to, rather than the questions that should be asked—is to demolish Vauxhall bus station, the second biggest interchange in London, to get development that will include tower blocks? Does he understand the importance of the bus station to local people and its users, none of whom have been asked anything?
Mr Thomas
I bow to my hon. Friend’s much better knowledge of Vauxhall station. If she is concerned, I am sure that her constituents are concerned. She mentions Vauxhall; I was about to say that it expects a 40% increase in the number of passengers in the coming years. I agree that it seems odd for such a crucial interchange station to lose its bus station.
Kate Hoey
May I add a tiny point? The importance of Vauxhall bus station is that people are able to transfer from train to tube to bus without getting wet, because of a cover that cost £10 million and was put in only about 11 years ago. It is a travesty for TfL to be thinking of demolition.
Mr Thomas
My hon. Friend has made her point, and I stand with her on her concerns about Vauxhall station.
Also in south London, Waterloo’s overall passenger numbers have rocketed from 62 million 10 years ago to 100 million now. At some locations, peak-time travel is already close to unsafe, as I have said, and, for example, closure of Oxford Circus tube station due to overcrowding is now routine.
It is not just the rail and tube networks that TfL manages that are under pressure; its own estimates suggest that London’s roads are coming under greater pressure from increasing car usage, at a time when there is pressure to allocate more space to achieve safer cycling and good walking routes. If nothing else changes, by 2031 an increase in congestion of at least 60% is expected in central London; for the rest of inner London, congestion is set to rise by some 25%; and even in outer London, we expect to see a 15% increase in congestion. Traffic speeds are coming down and car journeys are taking longer. Congestion is already bad for ordinary car users, who face the nuisance of longer journeys, and it is bad for business, too.
As an aside, I hope the rumours that the Government are trying to ease air pollution controls are false, because in London the scale of air pollution, much of it diesel-related, is already extremely worrying. Perhaps the Minister will comment on that. The continuing need for TfL to invest in greener, less polluting vehicles is widely accepted, but such investment is a not insignificant future cost. However, from 2010-11 to 2014-15, TfL income from the Department for Transport fell by more than a third. In the coming year, Government grants will amount to only a little more than 20% of TfL’s annual budget. The transport systems of major competitor cities in Europe receive a considerably higher percentage of their funding from central Government sources. In Paris, for example, transport gets more than 40% of its funding from a Government transport tax.
Transport for London receives two types of grant from central Government: resource grants and infrastructure grants. The Department for Transport was hit particularly hard in the spending round, so it is perhaps no surprise that TfL has been significantly affected, with a 34% cut in funding overall in 2016-17. In the spending review, the Government said that they would phase out the resource grant to TfL, claiming that that
“will save £700 million…which could be achieved through further efficiency savings…or through generating additional income from…land TfL owns”.
It would be more accurate to say that TfL will, as a result of the Chancellor’s decisions, lose about £3 billion over the business plan period of 2015-16 to 2020-21. Inevitably, the loss of grant funding will have an adverse impact on the quality of service that my constituents can expect. The resource grant is to be axed—crucially, earlier than TfL had been led to believe.
The Parliamentary Under-Secretary of State for Transport (Mr Robert Goodwill)
The hon. Gentleman has outlined the massive increase in usage of the underground and other TfL transport. Congestion charge takings have also increased, because of more vehicles. Does he not therefore agree that any resource funding needs to be viewed in the context of fares, which are coming in in larger numbers?
Mr Thomas
I will talk about fares in a little while, and of course one has to look at TfL income in the round. Nevertheless, I hope that the Minister accepts that the loss of £3 billion over the current five-year business plan period is a huge reduction in funding.
Before the spending review announcement a couple of weeks ago, TfL had still expected to receive almost £800 million in revenue funding until as late as 2019-20. Any surplus in resource spending—there has consistently been a substantial surplus in the operating budget—has been reinvested to help fund TfL’s capital programme. Any loss in that funding will therefore inevitably have an impact on capital investment.
The announcement of those huge cuts comes at a time when TfL has had to announce a five-year delay to the wonderfully named sub-surface upgrade programme: a plan to increase by 40% the number of people who could travel on the District, Circle, Hammersmith and City, and—crucially for my constituents—Metropolitan lines. New trains and better signalling were to be delivered by 2018, but following the failure of the contract with Bombardier Transportation, the expected completion date has been shifted back to 2023. Will the Minister confirm that the cut in funding to TfL will not further exacerbate the delay in modernising the Metropolitan line and those other lines that were initially part of the sub-surface upgrade programme? TfL has estimated that the knock-on impact of the delay on London’s economy is £900 million. That is income and jobs that Londoners, some of them in my constituency, are set to miss out on.
TfL now claims that the cost of completing the modernisation of the Metropolitan line and the other routes under the sub-surface upgrade programme has increased by £1.15 billion since previous forecasts. To put that into context, TfL’s planned capital expenditure for 2016-17 alone is about £3.3 billion. Inevitably, the extra costs from the failure of the Bombardier Transportation contract, plus the huge cut in grant funding, call into question other investment projects and the speed at which they will be completed.
Kate Hoey
My hon. Friend is giving us a really good review of what is happening. Does he not think that TfL should go back to doing what it should be doing, rather than putting £30 million into a project to build a garden bridge that the local community does not want? It is shocking that TfL is putting £30 million into that when it could be spent on other, important issues.
Mr Thomas
I share my hon. Friend’s scepticism about the garden bridge. Like her, I wonder whether that money might be better spent. A whole series of projects in my constituency could use that £30 million well, and I want to draw the Minister’s attention to a couple of those.
Clive Efford (Eltham) (Lab)
On the garden bridge, which no one has ever asked me for, TfL intends to build the Silvertown tunnel in south-east London to relieve congestion at the Blackwall tunnel, but it says that local residents will have to pay for it through tolls, though no other river crossing in London has charges. Perhaps the garden bridge should have an entrance fee, so that it can pay for itself instead of taking money away from vital transport links that are needed in the rest of London.
Mr Thomas
Rather than getting into the detail of what may happen with the garden bridge, let me say that I would prefer to see that money reallocated to a series of other existing and necessary capital investment projects. If my hon. Friend will forgive me, I think the priority is Harrow, but I am sure that he will be able to make the case for south London well.
I come back to the concern that the £3 billion cut in funding in the spending review and the extra costs from the sub-surface upgrade programme might put other investment projects at risk. The Piccadilly line refurbishment is particularly important for many of my constituents who live in Rayners Lane, South Harrow and Sudbury Hill. Will the refurbishment programme for that line go ahead as planned? There has been much speculation about when, or if, the night tube will go ahead. Perhaps the Minister can give us an indication of whether it is at risk of cancellation or substantial delay as a result of those cuts. In the Minister’s intervention, he raised a point about fares revenue. The upgrade of the four lines in the sub-surface upgrade programme would have generated extra fares revenue that will now be lost, as more passengers will not be able to be carried until much later. Some estimates suggest that that could be as much as £270 million lost.
In the eight years in which the hon. Member for Uxbridge and South Ruislip (Boris Johnson) has been Mayor of London, fares have rocketed. Some of my constituents, such as those who travel from West Harrow on the Uxbridge branch of the Metropolitan line, have seen a 60% increase in the cost of travelling into central London. My constituents and others who live in outer London and use the tube regularly have been treated as a cash cow by the Mayor of London for too long. I am concerned that the loss of that £3 billion may increase the pressure on the Mayor, and/or future Mayors, to raise fares still further.
I am also concerned that further job cuts on Transport for London’s network, which are now inevitable, will further compromise the safety and security of passengers, including my constituents. TfL operational staff fulfil crucial operational functions as well as many safety-critical roles such as managing peak flows of passengers and handling emergencies. On the tube, DLR and Overground, adequate numbers of staff are needed to identify and respond to emerging crush situations.
Adequate numbers of staff are required to limit fare evasion, too, which is rocketing—it is up to £61 million a year following a reduction in staffing levels. I pay tribute to Greater London Authority Labour colleagues, led by the excellent Val Shawcross, Navin Shah and Len Duvall, for that information. Visible staff help to deter and detect crime, including people preparing for or engaging in acts of persistent serious crime and even—God forbid—terrorism. Staff also reassure passengers during tense periods such as now, but staffing is at its lowest level in recent history and Government cuts make it look likely that it will drop further.
Under plans for staff cuts at stations, Leytonstone station, which currently has four staff in peak periods, will be reduced to two members of staff—a 50% reduction at a station where there has already been a worrying terrorist incident. That is just a small indication of the worry that further job cuts, driven by the major cut in Government funding, might force on us.
I understand that London Underground Ltd now plans to cut a further 838 front-line staff positions from normal traffic hour operational levels. New staffing levels have apparently been derived from so-called business need schematics formulae, which do not incorporate the need for security checks or other operational needs. As a consequence, staff are required to meet the demands of security checks and will have to be removed from their allocated customer service positions for sizeable portions of their shifts to do so, leaving their areas unstaffed and effectively unmonitored on occasion. That is a concern. Will the Minister be willing to review with Transport for London’s managing director whether the loss of those front-line staff is a sensible way forward and whether alternatives might be found?
Mr Goodwill
Does the hon. Gentleman agree that, given Oyster and the introduction of other smart ticketing systems, the move to get staff out of ticket offices and on to stations to assist passengers and help with security is good and something that we wish to see more of?
Mr Thomas
I might have been more sympathetic to the Minister’s intervention if there were not plans to shut more of the control rooms on the underground, because London Underground Ltd proposes that all but a few control rooms in the largest stations will be de-staffed. Proposed staffing cuts and that emphasis on customer-facing duties will require staff who are normally allocated to control rooms to work in the ticket hall. The result will be that there will be no routine monitoring of CCTV at more than 90% of stations, including some that have high volumes of passenger traffic, when major events are taking place. Will the Minister be willing to meet, with me, a deputation of the workforce who are concerned about the impact of the various job cuts on passenger safety? I look forward to his answer, and hope that he will, in the spirit of his interventions, and the spirit in which I have taken them, be willing to do that.
I want to raise some concerns about the impact of the cut in TfL funding on the accessibility of the London underground network. My constituency has six tube stations—exclusively tube stations—that are inaccessible to people using a wheelchair, and usually inaccessible to people with a pram. I understand that there are no plans for North Harrow, South Harrow, Sudbury Hill, Rayners Lane or West Harrow to be made accessible. There has long been talk of a plan for Harrow on the Hill to be made accessible, but it is not currently included for access to the small amount of funding that is available to make stations more accessible. I worry that the loss of £3 billion will reduce its chances even further. Perhaps the Minister would use his influence with Mike Brown, the head of Transport for London, who I am pleased to say came to North Harrow station to celebrate its centenary earlier this year, and encourage him to take an interest in the accessibility of Harrow on the Hill station.
My last point about the impact of the cuts concerns property income and the pressure on Transport for London to maximise its income from property sales or assets—essentially from the land that it owns. I should think that the whole House would think it a good thing to encourage Transport for London to make its land available for housing. The concern is that it is being put under heavy pressure to extract as much value as possible from selling its land or the housing on the land, with no consideration of Londoners’ broader needs for affordable housing. There are also concerns, as my hon. Friend the Member for Hammersmith (Andy Slaughter) knows well, about the methods being used to encourage Transport for London down the property development route. It has established a commercial development advisory group, which is chaired by Francis Salway, with Richard Cotton, Mike Jones and Richard Jones as the other members, but I worry that none of them has a background in social or affordable housing. I hope that the Minister may be willing to use his good influence to encourage Transport for London to see the bigger picture about housing in London, while at the same time seeking to maximise its income from its land.
Andy Slaughter (Hammersmith) (Lab)
My hon. Friend is right to be suspicious of Transport for London’s motives. It is on record as saying that two thirds of its sites will be in zones 1 and 2 and it is not looking for affordable housing in that area; but it is looking for some if it develops in zones 3 to 5. However, that is affordable rather than social rented housing.
Mr Thomas
My hon. Friend makes a good point and I look forward to his speech, if he catches your eye later, Mr Hollobone.
There was nothing in the spending review about funding for Crossrail 2. To be fair to the Government, I understand that they have set up a £300 million pot for advanced work on big infrastructure schemes. Will the Minister confirm that Transport for London can bid for money for Crossrail 2 within that pot, and explain whether the Government still support and recognise the need for Crossrail 2?
Of the £687 million in resource funding that Transport for London is getting this year, but which will be axed in future, £63 million is going to the capital programme; £137 million is going for borough improvements; £289 million is going on new greener buses; and £198 million is going for tube renewals and other investments. One has to wonder about the future of the investment in green buses, given the loss of resource funding going forward. It is striking that London Councils took the time to provide a brief for this debate, noting the impact of the funding received under TfL’s resource funding programme. It has been used to invest in road safety and maintenance, cycle parking and cycle training, car clubs, the installation of electric vehicle charging points, school and workplace travel plans, 20 mph zones and some further effort for accessible transport and pedestrian crossings. London Councils points out that much of that work—particularly that on road safety—has led to a significant reduction in the number of people killed or seriously injured on London’s roads. The implication is that there is concern about how such work is to continue to be funded.
I want lastly to consider how the gap in Transport for London’s books might be filled. I have always been a strong supporter of fiscal devolution to the capital, and having criticised the Mayor of London for big fare hikes I should at least acknowledge the important work that he got Tony Travers to undertake on fiscal devolution. I welcome the Chancellor’s decision to devolve business rates to London, but I am sure that the Minister will acknowledge that business rate income is often lumpy, if that is the word, and not always easy to predict. It would be helpful if, as the Tony Travers commission suggested, other property taxes were to be devolved to London. The devolution of stamp duty land tax to the London Mayor might help to unlock new investment in transport development, particularly in relation to the building of new homes that would be enabled by improved transport links. I understand that the vehicle excise duty incurred by Londoners who own cars amounts to about £500 million at the moment, and it might be suitable to invest that in London’s transport rather than taking it out of London and investing it in roads in the rest of England. I ask gently of the Minister, whom I saw shaking his head a little earlier, whether it is time for him and the Chancellor of the Exchequer to agree to redirect that £500 million to City Hall, to ensure that London’s road network gets the investment it needs.
Several hon. Members rose—
Mr Philip Hollobone (in the Chair)
Order. I have before me three of London’s finest Members and we have half an hour before I call the Front-Bench spokesmen, which I want to do no later than 10.30 am. If all three hon. Gentlemen want to speak, and to be fair to each other, I ask them please to take no more than 10 minutes each.
Jim Fitzpatrick (Poplar and Limehouse) (Lab)
It is a pleasure to see you presiding over our business, Mr Hollobone. I am not sure where the three finest are, but my hon. Friends the Members for Hammersmith (Andy Slaughter), for Eltham (Clive Efford) and for Vauxhall (Kate Hoey) are here, as am I, and I hope that we can make a contribution to the debate.
I congratulate my hon. Friend the Member for Harrow West (Mr Thomas) on an excellent opening speech. He comprehensively covered issues such as funding, resourcing and staff cuts, which saves us having to raise them, and I look forward to hearing the Minister’s response.
It is good to see that the shadow Minister, my hon. Friend the Member for Cambridge (Daniel Zeichner), is here to represent Her Majesty’s Opposition. It is also good to see the Minister in the Chamber. I congratulate him on his recent promotion, which will hopefully make him more benevolent towards London. I intend to speak briefly—certainly for no more than 10 minutes—and to raise parochial issues, given that the opening speech made by my hon. Friend the Member for Harrow West covered all the major funding issues.
I start by thanking Transport for London for its briefing, and its staff for all they do to keep this great city moving, ensuring that my constituents and I can get about. Their work is highly regarded and they do a fantastic job.
I was not going to mention the Silvertown crossing, but as my hon. Friend the Member for Eltham raised it, it will be interesting to hear the Minister’s comments about what support the DFT will give TfL for east London river crossings. Half of London’s population now lives east of Tower bridge, yet we only have two crossings there, while there are 23 crossings west of Tower bridge. As tolling will be an issue, I would expect at least the same arrangements to apply to local residents in east London as those for residents around the Queen Elizabeth II bridge. Any tolling should be discounted, but I would be quite happy to put up with tolling to ensure that we get the crossing.
East London’s air quality is poor, and it is made poorer because of standing traffic and congestion from the Blackwall tunnel. We need to get that traffic moving. When the Blackwall tunnel has difficulties, as it regularly does because of collisions or oversized vehicles, there is gridlock in east London. It will be interesting to hear the Minister’s comments about the Silvertown crossing.
My hon. Friend the Member for Harrow West talked about VED and support from licensing revenue in London. My understanding—this may be entirely wrong, so the Minister might correct me—is that the vast majority of local authorities across the country get road support grants to deal with potholes, repairs and the like, but London does not receive such grant. That gives the impression that dealing with potholes in London is paid for by tube and bus passengers, who are subsidising the missing grant.
If one thinks about financial pressures, one can draw conclusions that may be entirely erroneous. We have a new franchisee running the docklands light railway: KeolisAmey. When I started in the Commons, the DLR was carrying some 20 million passengers a year. It now carries 100 million passengers a year, including many colleagues from the Scottish National party when they travel to London City airport to fly back to Scotland on a Thursday night or Friday morning. My hon. Friend the Member for Harrow West set out the massive increase in journeys on the DLR. That fantastic railway is, of course, a driverless operation, which makes it separate from most of TfL’s other rail operations.
The new DLR franchise is only six months old, but its staff have already gone on strike for the first time in 23 years. One has to ask whether the resourcing of the DLR and pressure on the contract led the new franchisee to put pressure on staff’s conditions and wages. That is total speculation on my part, but the fact that we have had the first DLR strike in 23 years is not a good sign. It is certainly a concern for my constituents and a very worrying development indeed.
The final point I want to cover is another parochial one. I see that the Minister is wearing his red ensign badge proudly as shipping Minister—there is nothing wrong with that at all, and I applaud him for it. Yesterday, I attended a Port of London authority presentation at Tower pier at which it outlined its vision for the River Thames for the next 20 to 50 years. The most striking thing about the presentation was that whereas most people think that the Thames’s heyday is behind it—we have the visuals of riggers in the past 200 years and merchant vessels in the 20th century being unloaded in the docks—and that it is now much quieter, with Thames Gateway and the port of Tilbury, as the Minister will know, London is now dealing with more tonnage than ever in its history.
With new commuter routes being opened up all the time, there is more commuter traffic than ever. Construction projects such as the Thames Tideway tunnel and, to a certain extent, Crossrail, which require the Thames to be used and that get HGVs off London’s roads and traffic on to the Thames, are welcome. The PLA’s vision is that the Thames’s best days are ahead of it, so it is really disappointing that the proposed cruise terminal at Enderby Wharf, which has been approved by the Royal Borough of Greenwich and the Mayor of London, does not have a ship-to-shore energy supply. That means that when cruise ships start arriving in London, they will have to run their diesel engines 24/7 to power them while they are berthed in the middle of the Thames, which is the equivalent of putting hundreds of lorries’ emissions back into London’s air. If we provided a ship-to-shore energy supply, which I believe would cost only up to a few million pounds, we could deal a big blow to London’s emissions.
Given that background, what funding does the Department for Transport provide for TfL to study air quality? Transport emissions play a big part in air quality, as they account for between 25% and 30% of all emissions. The shipping industry is growing, and we want to ensure as much as possible that its growth is environmentally sustainable and clean. Does the Minister have anything to add to the debate about the cruise terminal at Enderby Wharf? Can he say whether, even at this late stage, ship-to-shore energy supply could be introduced into the plan, given that the situation is a negative dark spot on what ought to be a positive clean bill of health for the Thames?
I again congratulate my hon. Friend the Member for Harrow West on securing this important debate. I have raised much more parochial points than him, and we will be interested to hear the speeches from the three Front-Bench spokesmen.
Andy Slaughter (Hammersmith) (Lab)
May I, too congratulate my hon. Friend the Member for Harrow West (Mr Thomas) on securing this timely and important debate? This issue is raised frequently in both Houses. Yesterday, during questions in the other place, two of the points that my hon. Friend mentioned were raised. Lord Tope noted that the £639 million operational grant for this year will decline to nothing within three years, while Lord Dubs raised an important question that I will deal with: if Transport for London is going to become a property developer over the next decade, where and how will it build, and what will it will build? It is particularly important to note that there will be little social housing among the alleged 10,000 homes to be built.
The other place is also shortly to discuss the Transport for London Bill, a private Bill that has been limping through both Houses for five years. It would have been killed off in the main Chamber a couple of weeks ago, had not the Government whipped 140 of their Members to vote for the revival of that rather sad and sagging Bill. If London MPs had their way, the Bill would be put to rest quite quickly. If I have time, I will deal with that issue but, in any event, I have no doubt that we will consider the final stages of that Bill in the new year and discuss at length the problems with it.
Should TfL become a property developer to make up the £2.8 billion that the Government are taking away from it between now and 2021, it will of course need to manage its estate properly. It has not always done that well in the past, and I doubt the capability and competence of transport organisations—even though many very good people work for them—to deal with some of the most rapacious and greedy property developers in London. Somehow the public sector also seems to come off worse when it enters into such deals.
Even what TfL is planning at the moment does not fill me with enthusiasm. It is looking for 75 sites spanning 300 acres, with the aim of raising £1 billion. As I said in my intervention, two thirds of those sites will be in zones 1 and 2, presumably because although there is less land in those zones, it is more profitable. Only when TfL subsequently begins to look at zones 3 to 5 does it expect to include affordable housing in its considerations. It is going to work in joint ventures with private companies, and the model for that is the tragic site at Earls Court, which is one of the largest development sites in London, with two thirds of it owned by TfL. The joint venture with Capital and Counties Properties plc covers 77 acres and includes the Earls Court exhibition centres and the Lillie Bridge depot. The third part of the site—22 acres —consists of two local authority housing estates with 760 affordable and social homes.
The development of that site, which I believe is a template for what TfL will do in the future, will provide 8,000 homes with no additional social homes, even though according to planning targets, and even the targets of the Mayor of London, there should be 2,000 such homes. The 760 existing homes will be demolished, which will affect the entire community. The Earls Court exhibition centres are beautiful and their loss is tragic. Earls Court One, an art deco building that is currently being demolished, provided 30% of London’s exhibition space.
I laughed at what TfL told the Financial Times when it announced its plans about six weeks ago. It said it was
“working with its operations team to ensure that it learns from mistakes made by the national rail network in the past and only ‘develops sites where no transport capacity growth is expected so as not to constrain operations.’”
The other part of the Earls Court site that is going is the Lillie Bridge depot, which is one of the main manufacturing and servicing depots. It is an ideal place for servicing and provides 500 skilled jobs, which is why the National Union of Rail, Maritime and Transport Workers has considerable concerns about the development.
If Earls Court is a blueprint, God help us when TfL begins to develop other sites around London. It has already identified three. One, which is in Hammersmith and Fulham but not in my constituency, is the Parsons Green depot site. The very good Labour council there is negotiating hard with TfL to include affordable housing on the site. There will be 120 new homes, but no homes for social rent are planned, although I hope that that will change following negotiation with the local authority.
As I know that area extremely well, I can give an example of what can happen. Almost opposite the proposed site is an almost identical depot site that was owned by the Co-operative Group. That has been developed with 100% affordable housing—50% intermediate and 50% for social renting. If such a target can be reached, TfL’s ambitions in an area with a crying need for affordable housing, especially in zones 1 and 2, should be at least a lot greater. I note from the property pages of today’s Metro that the average price of a property in Hammersmith, let alone Fulham, is more than £1 million, and that is exactly the type of luxury property that TfL is endeavouring to build on its land.
A measure in the Transport for London Bill—during its early stages some four years ago, my constituents petitioned against it—would have given TfL the power to sell land without reference to the Secretary of State or any outside body. I am pleased to say that, following scrutiny, the relevant clause was withdrawn, because otherwise TfL could have done exactly what it liked. Given the Government’s housing policy, which we will discuss in the House later today, I have no confidence that the Secretary of State’s intervention will represent a proper remedy. In any event, the Bill is deeply flawed because it encourages TfL to enter into limited partnership agreements and allows it to go further even than it went at Earls Court by having unsuitable, voracious partners in the property development market. That may or may not provide a profit for TfL, but it will do nothing for the neighbourhood and interests of ordinary Londoners.
My hon. Friend the Member for Harrow West talked about the upgrading of the sub-surface network, which includes the Hammersmith and City, Circle and District lines. It would be a tragedy if that were postponed for another five years. Those incredibly busy lines have some of the worst signalling on the underground network. I believe the signalling at Earls Court dates from the 1960s, so perhaps the Minister will comment on that today. My constituents would not welcome him saying blithely that the upgrading will be delayed by another five years.
A specific problem is the removal of Olympia station from the timetabled network. I was pleased to have the first newly built station in a century on an existing tube line at Wood Lane as part of the Westfield development. TfL made a big song and dance about that, but less of a song and dance when it took a station off the timetabled network, despite Olympia serving one of the most densely populated communities in London and linking to the very good overground service at that station. We were told at the time that the reason was congestion at Earls Court—that has been the case for about 40 years—and that TfL wanted to prioritise the Wimbledon branch of the line. That was not popular with my constituents.
When the signalling is upgraded—whether that is in 2019 or 2023—it will relieve the problem. There will be more capacity, longer and more effective trains and better signalling. With that full expectation, I wrote to the new managing director of London Underground to ask for at least a commitment that Olympia would be put on the timetabled network again, but I was told, “No. There is no intention of doing that.” What is the point of investment and of TfL becoming a property developer if the net result is that the investment in its own network does not do what its passengers and fare payers want?
In May 2016, we will have a new Mayor—hopefully a Labour Mayor. My right hon. Friend the Member for Tooting (Sadiq Khan) has promised to freeze fares, to provide one-hour hopper tickets and to run TfL in the interests of all Londoners, not in the interests of property developers, its own highly paid managers or bailing out the Chancellor. However, we currently face a double whammy of losing central Government investment, which no other civilised country would do to its capital city, while at the same time we do not see any other improvement in Londoners’ quality of life because TfL is simply rushing madly into property development.
Clive Efford (Eltham) (Lab)
It is a pleasure to take part in this debate under your chairmanship, Mr Hollobone. I congratulate my hon. Friend the Member for Harrow West (Mr Thomas) on securing this important debate. I start by associating myself with the comments of my hon. Friend the Member for Poplar and Limehouse (Jim Fitzpatrick) on the cruise liner. I will not go into detail because I do not intend to speak about that, but I entirely agree with his points.
I, too, want to be parochial and I will talk mainly about the proposed Silvertown tunnel in the context of TfL’s funding. I have long called for a solution to the problem of traffic congestion on the approach roads to the Blackwall tunnel. It is a daily environmental disaster and occurs when queues of traffic build up, particularly at peak times, causing a huge environmental problem of air pollution in that part of our borough. The topography of the area means that a lot of pollution collects in the river valley, and having stationary traffic stuck there for long periods just adds to the problem. That traffic will not disappear. It needs to go somewhere and the problem needs some relief. There are no alternatives. We do not have the London Underground in south-east London beyond North Greenwich station and people rely heavily on surface and suburban rail services, which are already at over capacity so we need to increase capacity there. I will come to that later.
In many circumstances, people are forced to drive. That applies particularly to residents of the boroughs of Greenwich, Tower Hamlets and Newham, for which the Blackwall tunnel is the nearest river crossing. People have to use that crossing to get across the river, so we are seeing a significant impact on people’s daily routine because quite often they are delayed and cannot predict when they will be able to get through the tunnel. In addition, many businesses lose time and money because of the traffic congestion. We need to deal with the traffic congestion at the Blackwall tunnel and we need a third bore, but dealing with the issue by building a road crossing alone will not be sufficient.
We have been offered buses by TfL, and we will take the buses. They have buses in other parts of London, and of course we want more buses. However, the equivalent of a small city has been built in Docklands. We have seen massive expansion not just of housing, which will continue to grow, but of businesses and leisure, and more and more people want to go north and south on the eastern part of the Thames corridor, rather than on the traditional route, like the spokes of a wheel, served by suburban rail that goes in and out of central London. Without increasing significantly public transport links that go north and south across that east Thames corridor, we will congest even more the central London transport system, because people have no choice, if they want to use public transport, other than to go in and then out.
Jim Shannon (Strangford) (DUP)
It is always good to give a Northern Ireland flavour to a debate on London transport. The hon. Gentleman referred to using more buses. I, too, encourage people to use more buses, because if more buses are bought, they will come from Wrightbus in Northern Ireland, so it is always very good to have that.
Clive Efford
I cannot think of a better reason to want more buses. To get even more parochial for a minute, I want to put in a plug for TfL finally to deal with the issues with my local services, on which my constituents have been campaigning. I am talking about the B16 and 178 buses through Kidbrooke. Those issues must be resolved; we are not accepting no for an answer, and we welcome the moves that it has made already on the B16.
The 132 bus runs from Eltham to North Greenwich, and when I became a Member of Parliament I campaigned for its introduction. TfL came to my office to meet me and said, “There’s no demand for such a service.” It was to provide a public transport link along the route corridor of the A102, the Blackwall tunnel approach road. Finally, as the Olympics approached, we got an extension of the 132 bus route down to North Greenwich. It was a single-decker bus and it quickly filled up, so a double-decker service had to be introduced. That service is now often oversubscribed and passengers are left behind at the terminal where the bus starts—at North Greenwich—such is the increasing demand from people for public transport links along the route corridor of the A102, which connects with the A2 and my constituency of Eltham.
A road crossing, therefore, will not be sufficient: we need to have the DLR. If TfL is not going to build a DLR link, there is no point in building the Silvertown link, because it will just become as congested as the Blackwall tunnel is now. People will have no alternative to switch to—in the large numbers that we need them to switch—if we are to protect that route from becoming congested again in the future, just with more cars. As my hon. Friend the Member for Harrow West pointed out, the DLR has in recent times increased its usership significantly—by more than 50%. It has gone up from a few million passengers, as my hon. Friend the Member for Poplar and Limehouse said, to nearly 100 million passengers a year. That shows how effective it can be, so a DLR link from Silvertown to North Greenwich—that is then brought down the route corridor of the A102 to places such as Kidbrooke and Eltham—will have a significant impact by changing people’s choices of the transport method that they use to get across the river in that part of the city.
We cannot allow traffic to grow, and I accept that some form of tolling will be needed, but no one else in London pays to cross the river by their local bridge. I do not see why my constituents should have to pay to cross the river when no one else in London does. If TfL says that the only way to fund schemes in the future—because of the cuts to its budget—is to introduce tolling, I say that it has to be fair to my constituents, who in recent years have watched billions of pounds being invested in the London underground, which does not come anywhere near where we live. We accept that it is a major contributor to London’s economy and is vital—no one disputes that—but the comparison between the investment in other parts of London and that in outer south-east London does not stand up to scrutiny. We have bus services, but other than that, TfL spends precious little on investment in that part of London, so asking for—no, demanding—a DLR link as part of the scheme is just asking to be compensated for the lack of investment in previous years.
If people in my area are to be asked to pay a toll to pay for the river crossing, we should toll every river crossing in London and make everyone pay to cross the river, because that is the only fair balance that we could strike. I see the Minister’s eyebrows going up as he thinks, “Actually, there might be a point there. We might be able to make some money.” It is true that we have sat by in south-east London and watched money being spent on the London underground, while getting precious little—
Clive Efford
I have a finishing time in order to allow the Minister time to respond, but if he will be brief, I will give way to him.
Mr Goodwill
I just point out that those who pay the congestion charge might argue that they are already paying to use the bridges and perhaps would not be thankful to be double-charged.
Clive Efford
They might well, but there are bridges beyond Vauxhall. I can point all the bridges out to the Minister if he needs me to do that; I can name them all. We need the Silvertown link, but it cannot be built without the DLR.
I want to move on to talk about a site in Kidbrooke, Henley Cross that is owned by TfL. TfL is definitely trying to maximise its income from that site, but we need such sites, which are in public ownership, to be used to provide local services and vital affordable housing where possible, not just sold off to the highest bidder. I would like to put in a bid to TfL to consider that site in relation to the Kidbrooke regeneration and the need to identify sites for secondary schools in the borough of Greenwich. Henley Cross is situated between the motorway—well, the approach road to the Blackwall tunnel—and the railway. The site is unsuitable for people to live on, but it would be suited to other uses. Perhaps some sort of land swap could be arranged with the Kidbrooke Village regeneration and a school could be built where it was intended to build a Sainsbury’s supermarket. I urge TfL to sit down with the London borough of Greenwich and with Berkeley Homes, which is doing the development, to consider that option, rather than cramming housing on to the site, which is unsuitable because of its location.
Finally, I want to turn to TfL taking over the running of suburban trains, which are vital for my constituency as it relies entirely on suburban trains as the major route into London because—as I said—we do not have direct links to the London underground. If that is to happen, TfL needs to start planning ahead now. At peak times, trains that run through my constituency—through Eltham, New Eltham, Plumstead and along all those routes—are heavily oversubscribed. They have so many passengers they have PIXCs—people in excess of capacity. We need to increase capacity on those lines. That means that when the Thameslink scheme is completed and the new rolling stock becomes available, the current Thameslink rolling stock must be made available to Southeastern, which wants to purchase it, so that it can increase capacity on those vital services in south-east London.
Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)
It is a pleasure to serve under your chairmanship, Mr Hollobone. I congratulate the hon. Member for Harrow West (Mr Thomas) on securing the debate. I also congratulate the Minister of State on his recent promotion, and I know that he will enjoy the additional challenges it brings.
I have been asked to sum up for the third party, and I will try something quite unusual, which is to do so in a third-party way, and to be as apolitical and as helpful as I can. I want to refer to Scotland and what the Scottish Government are doing, because I believe in their approach, and I think it would be helpful to bring it into this discussion.
The hon. Member for Harrow West talked about Transport for London services being crucial to business and to people. He talked about London’s urban growth being the fastest in the European Union. I have something in common with him, because Inverness is the fastest-growing city overall in Europe. I know exactly what he is talking about, but perhaps on a different scale.
People coming into London have an interest in this issue as well as those already in London. People need to make internal connections, but external connections cannot be ignored. It is every bit as important to make sure that links such as the Gatwick Express operate properly. I hear again that it is a disaster this morning, incidentally, with two trains cancelled and another stuck for many minutes on the line. The hon. Gentleman talked about roads being under pressure, and the knock-on impact of a failure to invest. That came through in all hon. Members’ contributions, as did the point that what may have been missing is a longer-term vision and an overall view of how things should be developed.
The hon. Member for Vauxhall (Kate Hoey) made an important intervention in which she talked about the absolute need to engage people in major decisions. That brings me to my first point about the approach in Scotland, which I feel passionate about. I think there is agreement across parties on an outcomes-based approach to development, where we take things forward towards a longer-term outcome with people in mind, rather than as an afterthought. That came through time and again.
The Minister spoke in an intervention about smart ticketing, and I compliment him on doing so. We have to make it easier for people to use different modes of transport, but it is important—we must mention this early—that smart ticketing be fair. It should be carried forward in such a way as to enable everybody to interact with it. A point was made about fairness later on, and adopting an outcomes-based approach makes a big difference to that.
The hon. Member for Poplar and Limehouse (Jim Fitzpatrick) rightly mentioned the hard-working staff on the network. Too often, we forget that when we ask people to take charge of new developments and bigger challenges, those involved in their delivery will be put under pressure. The hon. Gentleman was quite right to mention those people. We should reflect in the same way on the people who work in the transport system across the nations of the UK. He made the telling point that the DLR recently had its first strike for 23 years, and that tells us something about the communication that is needed. He also made an important point about the growing need to take shipping into account.
One thing missing from the debate—I am not trying to score points, but I want to take in the context—was any discussion of possible airport expansion. Hon. Members do not know where the pressure will be in London, because the decision has not been made yet, but that must be taken into account in future planning.
Jim Fitzpatrick
Some of us, like the hon. Gentleman, listened in the Chamber yesterday afternoon to the statement from the Government, in which they delayed the decision yet again. That was most frustrating for most colleagues right across the Chamber.
Drew Hendry
I agree about that frustration. As I have said, I will not try to use this debate to score points, but we must look at making decisions that are connected to others that we make. Other hon. Members brought that out in spades today.
The hon. Member for Hammersmith (Andy Slaughter) talked about Transport for London as a property developer. He asked what kind of developer it would be, and what it would do in future. The point about outcomes for people shone through in his questions, and it is important to look at what kind of outcomes there will be. If property development will be a vehicle for investment, he is quite right to say that we should know what kind of investment will be made. He asked what the point was of TfL investments if not to improve transport for people.
The hon. Member for Eltham (Clive Efford) talked about air pollution, having the correct infrastructure requirements, and the need to see what people want to do in the future, which goes back to my point about outcomes. The hon. Member for Strangford (Jim Shannon), who is unfortunately not in his place, mentioned buses in an intervention. I want to mention Britain’s largest bus manufacturer, Alexander Dennis, in Falkirk. It would, I am sure, be delighted to supply vehicles. What is needed is an outcomes-based approach with a longer-term view. People should not, as the hon. Member for Eltham pointed out, be made to pay more just because of where they live. That should be taken into account when deciding how to take things forward.
I said I would talk about Scotland. Since 2007, more than £15 billion has been invested in transport, and the Scottish Government have adopted an outcomes-based approach to policy, through which they look for a healthier, wealthier, greener approach to development. I believe that that is now considered to be the right approach by those from across the different parties in Scotland. We have looked at sustainable transport options that will encourage people out of their cars, and made sure that we made the investments necessary to connect people.
Our conversation this morning contains a contradictory message, and I will fire back a bit of a warning to hon. Members. They cannot say, “Let’s not invest in cycling and walking” while moaning about emissions and congestion. There has to be a balance between those things. In Scotland, since 2011, we have invested in 190 km of cycling and walking routes. We have also made the largest single investment in Scotland’s transport history with the £3 billion upgrade of the A9, because it is a vital part of the transport mix, and it is what people asked for and required. I am delighted to say that it connects my constituency with Perth, and that connection is ongoing. That development was vital to the highlands economy, and it was part of our work on a mix of transport options, which included simultaneous investment in the rail links between Aberdeen and Inverness, and Inverness and Perth. Investment is not limited to those lines, however; hon. Members will be aware of the recently opened borders railway link, with which we threw off the ghost of the railway cutback and built the first new railway in Scotland since the Beeching cuts. In our rounded approach, we take an outcomes-based look at how transport has to be put together.
I will not take much more time. In summary, people’s absolute need and right to be connected fluidly to all the different transport options available came through clearly this morning. That is a substantial challenge for an organisation as big as Transport for London, but if it takes an outcomes-based approach—I fundamentally believe that all hon. Members’ contributions this morning indicated the need for such an approach—it will start to get somewhere with looking at the wider picture and the longer-term view.
Of course, if greater public investment is to be made, the public need to be involved and feel involved. It would be a good move for Transport for London to look at how it engages with people and how it will take forward conversations with the relevant communities, so that it can ensure that it carries forward in its planning the points made by hon. Members this morning. I hope that it will heed my warning and take an outcomes-based approach to such development.
Daniel Zeichner (Cambridge) (Lab)
I congratulate my hon. Friend the Member for Harrow West (Mr Thomas) on securing this debate, and the Minister on his recent promotion. We have had a fantastic discussion in which hon. Members have spoken with passion and conviction about their local area. It is important that those points are heard.
My hon. Friend the Member for Harrow West gave an excellent account of the whole range of issues. I was struck by his mention of potential delays to the upgrade of the underground system. I hope that the Minister responds positively to my hon. Friend’s hope that he might meet a delegation of staff, particularly given the number of staff cuts in the control rooms. My hon. Friend concluded with some interesting suggestions about how the funding gap might be closed, and I am sure that the Communities and Local Government team will listen closely to that.
Mr Gareth Thomas
Will my hon. Friend encourage the Minister to clarify—if not today, then shortly—whether the British Transport police will maintain their funding levels and, therefore, the numbers of constables and other police able to operate on the tube? There seems to be some doubt about whether they have benefited from the Government’s largesse to other police forces.
Daniel Zeichner
I am sure that the Minister will have heard that point. My hon. Friend the Member for Poplar and Limehouse (Jim Fitzpatrick) made some fascinating points. The point about the cruise terminal was new to me, but I hope that others will hear it. My hon. Friend the Member for Hammersmith (Andy Slaughter) continued his fantastic campaign on the Transport for London Bill, reiterating points that were made in a debate a few weeks ago and that, doubtless, will be made again. I will return to those.
My hon. Friend the Member for Eltham (Clive Efford) took me back to my childhood: I used to be driven by my parents from south London through the Blackwall tunnel when there was only one tunnel. I remember the pong, which I think was from a dog biscuit factory. Some things do not change, really, and there is clearly much more work to be done. His points about the unfairness of potentially charging his constituents to cross the river were well made.
I want to talk a little more generally about London’s transport system. As someone from outside London, I have to say that London’s system is widely admired as a model of excellence. There are now more passenger journeys in the capital than in the rest of England combined. In the UK, other metropolitan areas—including Manchester, notably—are keen to bring in Oyster-style, multi-platform, integrated smart ticketing. Indeed, I understand that Singapore’s Land Transport Authority last year announced a new Government contracting model after explicitly studying the bus systems of London and Australia; they say that imitation is the sincerest form of flattery, and that is clearly the case here.
We all know that the Department for Transport took a huge hit in the comprehensive spending review, as did the Department for Communities and Local Government. I fear that the repercussions will reverberate through the quality and connectivity of the transport system across the entire country. I am also sure, regrettably, that the savage reductions in funding and subsequent cuts to transport services will be keenly felt by all those who rely on them to go about their daily life. It is distressing but simple: cuts to central Government funding and local authority budgets mean that services will suffer.
Let us remember that in 2013 TfL’s operational funding was slashed by a quarter, requiring it to identify £16 billion in savings by 2021. Last month it was announced that the grant worth £700 million in 2015-16 will be phased out by the end of the decade. The Department for Transport said that this may be mitigated by “new commercial freedoms” for TfL. The implications of those commercial freedoms are potentially significant, and I will largely focus on them.
Along with funding for cycling nationally, London’s dedicated transport funding has been deliberately targeted in the spending review. As of 2014-15, a record 8.6 million people were living in the capital. By 2030, that figure is forecast to reach 10 million, rising again to 11 million by 2050. The pressures on the capital’s transport system will only intensify. TfL has already been making fierce and highly controversial cuts, but even it said in its annual budget last year:
“It is becoming progressively more difficult to achieve this without compromising our core services.”
I would be grateful if the Minister could offer some assurances about how the cut to TfL’s revenue support has been planned. It is well known that before the late 1990s, London Regional Transport was plagued by a pattern of annualised budgets and sudden funding reductions, which in turn created huge inefficiencies. TfL has more long-term financial certainty under Labour’s Greater London Authority Act 1999, but can the Minister really guarantee that additional costs will not be created—for example, in variations to TfL’s commercial contracts—as a result of this decision? We need further assurances.
Since October 2013, the bus service operators grant, which was previously paid to bus operators that were running bus services under franchise to TfL, has been incorporated into the general grant paid to TfL and the Greater London Authority. Now that TfL’s grant is being snatched by the Treasury, so too is this important grant that pays bus operators to keep costs down and helps to subsidise fares for ordinary people. BSOG was already cut by 20% in the previous Parliament, with the total value of the grant across the country falling from £469 million in 2009-10 to £298 million in 2013-14. Now the Government are quietly removing it from TfL entirely. That is unacceptable, and we will not let it go unnoticed. I would greatly appreciate the Minister’s assurance that BSOG will again be allocated to the capital on a separate basis; otherwise, this is clear discrimination against London.
TfL passes part of its grant to the boroughs to spend on local road maintenance and improvement. I am sure that those boroughs would be pleased to be told how that will be funded when TfL’s operational funding is soon reduced to zero. We have heard about the other possible method that TfL might use to alleviate the loss of the grant and to raise revenue to invest in London’s transport network. That method—the so-called commercial freedoms—is proving especially controversial, and many of my hon. Friends have already raised concerns about the wider implications.
The Department for Transport has stated that TfL could save the necessary £700 million a year by generating additional income from the land it owns in London, or with the “additional financial flexibility” that the Government will provide it with. TfL is one of the largest landowners, owning 5,700 acres of land in the capital and more than 500 potential major development sites. Against this backdrop of cuts, it is only natural that TfL wants to plug at least partially the gap that the grant will leave by selling off existing or underused facilities. We support making good use of assets, but there are certain issues that really must be addressed.
First, we need to be sure that forced sales will not, paradoxically, have an adverse impact on the very transport system that they are trying to fund. Selling off land might seem like a good deal in the short term, but it might not look so bright a few years later, when it transpires that the land is needed to expand transport services to meet increasing demand. If TfL land is to be used for housing, let us at least ensure that it is housing at a price that ordinary Londoners can afford. We need a pledge from the Minster that there will be a strong affordable housing element in such developments—particularly important given the disastrous general housing policies being pursued by the Government. Sadly, I have little confidence that that will be achieved.
We are deeply sceptical of the Government’s motives and fear that the asset sell-offs will be all about short-term gain at the expense of securing a future transport system for ordinary Londoners. I do not have time to go into the nitty-gritty of the argument, but the proposed mechanism for property development—namely, the provision allowing limited partnerships—is deeply worrying. I am sure that there will be time enough to discuss that controversial element when the Transport for London Bill wends its way back to us from the other place. Ultimately, a long-term investment strategy aimed at raising money to reinvest in the transport system is one thing, but short-term profiteering on property development is quite another.
In conclusion, TfL’s transport system works, and it ought to be protected, but it is at serious risk from a Government who seek short-term savings and do not understand the importance and value of a widely admired but pressured system that keeps our great capital city moving.
Mr Philip Hollobone (in the Chair)
It would be appreciated if the Minister would be kind enough to allow Mr Thomas just a few minutes to sum up at the end.
The Parliamentary Under-Secretary of State for Transport (Mr Robert Goodwill)
I congratulate the hon. Member for Harrow West (Mr Thomas) on securing this debate about Transport for London funding, which is timely following the spending review. I will put the cart before the horse by dealing first with some of the questions that have been raised, meaning that if I do not have time to conclude my remarks, what I want to say will be cut off, rather than what hon. Members might want to hear.
The hon. Gentleman asked whether the upgrade of the sub-surface lines will be further delayed by the cuts in Government funding, and I have to point out that the delay was announced before the spending review. Indeed, the delivery of the upgrade is a matter for the Mayor. We have protected TfL’s capital funding and expect the Mayor to prioritise such tube upgrades as part of that process. The hon. Gentleman also asked whether other projects will be delayed; once again, it will be a matter for the Mayor to prioritise such projects. We will be agreeing a settlement letter with the Mayor that makes it clear which infrastructure projects we expect him to deliver, and by when.
Mr Gareth Thomas
I gently plead the parochial point that the Minister prioritises in the settlement letter the Metropolitan line upgrade as early as is reasonably possible.
Mr Goodwill
I certainly take note of the hon. Gentleman’s point; no doubt that issue will be raised during the upcoming mayoral election.
The hon. Gentleman raised the specific point of accessibility at Harrow on the Hill station, and I will ask Mike Brown to provide me with a report as soon as possible about the practicality of addressing that. As the hon. Gentleman will be aware, many of our Victorian tube stations do not lend themselves to such upgrades at a reasonable cost, although we have made considerable progress. In particular, the new Crossrail project will vastly increase accessibility for people with mobility problems.
The hon. Gentleman also asked whether there could be further devolution of property taxes, which is, of course, a matter for the Chancellor of the Exchequer, who has announced that business rates will be 100% devolved to local authorities from 2020. There will be a consultation on that in 2016, including on how the system will work in practice. Various things will need to be considered, including how the income from London’s business rates will be split between the Mayor and the boroughs, and which Government grants that will replace.
The hon. Member for Vauxhall (Kate Hoey) talked about the garden bridge. The Government and the Mayor have each agreed to make a funding contribution, but most of the costs will be met by the private sector. The garden bridge will be an iconic and attractive addition to the capital, and it will be free—there are no plans to charge people who use it.
The hon. Members for Poplar and Limehouse (Jim Fitzpatrick) and for Eltham (Clive Efford) raised the issue of the Silvertown tunnel, which is, again, a matter for the Mayor. Transport for London has recently consulted on the proposal. We agree that the tunnel is an important project and hope that the Mayor can deliver on it quickly. TfL is considering what package of public transport improvements might be needed to complement any new crossings, which might include DLR extensions, but the Mayor will need to take a view on the relative priority of such extensions compared with other schemes.
The hon. Member for Poplar and Limehouse also mentioned the cruise ship terminal. I have visited both London Gateway and the port of Tilbury, and I was impressed by the investment going into those projects. Indeed, London is re-establishing itself as a major port. I pay tribute to Dame Helen Alexander, whose term as chair of the Port of London authority ends at the end of this month. She has been a driving force behind the work that has been going on.
The hon. Gentleman raised in particular the issue of ship-to-shore energy supplies in a number of ports across the country, on which I am keen. Indeed, ports could derive income from supplying electricity. We will certainly consider how that might be funded, but such sensitive sea areas come under the quality of marine fuel regulations that have been agreed throughout the European Union, so ships will have to use low-sulphur fuel or to be fitted with mitigation equipment to ensure that they at least take care of sulphur. I am aware that ships produce other pollutants when in port.
The hon. Member for Inverness, Nairn, Badenoch and Strathspey (Drew Hendry), who speaks for the Scottish nationalists, talked about smart ticketing, which has been revolutionary since I arrived in London just over 10 years ago. I was then buying tickets, so the introduction of Oyster has been fantastic. Of course, a new aspect of ticketing, which is already in force on the west coast main line and is an element of the new Northern and TransPennine franchises, is automatic refunds when trains are delayed. I hope that new franchises take that on board. In due course, I hope it becomes the norm that if a train is delayed, a customer, having bought their ticket or season ticket on the train operating company’s website, will automatically get a refund, rather than having to apply. Passengers in the north of England are looking forward to that service becoming available.
I think it was the hon. Member for Harrow West who talked about meeting staff at the National Union of Rail, Maritime and Transport Workers. I occasionally meet the RMT, but more through my responsibility for shipping. I suspect that the Mayor of London would primarily be moving forward on that issue, but I hope that, following further discussions, we can soon deliver on the night tube. Many people look forward to some sort of agreement on that, particularly at this time of year when London’s night time economy is so vibrant. The hon. Gentleman also raised the issue of manning for British Transport police. Many people were relieved when the Chancellor of the Exchequer announced that overall police funding would not be subject to the cuts that many had predicted, but I will look into the specific issue of British Transport police and get back to him.
The hon. Member for Cambridge (Daniel Zeichner) said that TfL is facing a huge hit to its revenue budget. Actually, in terms of capital funding, this Government will nationally be deploying 50% more than the previous coalition Government, which is good news for people who use our train services and roads. He also mentioned the bus service operators grant, which is indeed a fuel subsidy. One criticism that I get from bus operating companies and bus manufacturers is that the BSOG is a disincentive for the roll-out of environmentally friendly or green buses. For example, electric buses that use no fuel get no BSOG.
The hon. Gentleman also raised the fact that Transport for London will soon no longer need any day-to-day operating subsidy, which is a good news story as that has been made possible by our sustained investment in London in recent years allowing TfL to make significant operational savings. London’s growing population and successful economy mean that more and more people are using public transport in London, which in turn, as I pointed out earlier, means that TfL receives more and more income from fares. TfL’s commercial development programme is also allowing it to generate more income from the private sector.
Having not got on to my prepared introductory remarks, I shall conclude by making the point that the spending review settlement shows that we recognise that London today is a city on the move. The capital’s economy is moving emphatically in the right direction, and our support is helping to transform London’s transport network. I am proud to be part of that transformation together with all our partners, including TfL. The investment that we are making for the next five years will not just keep London mobile, but will equip the city for the challenges of the future so that it can compete and win in the 21st-century global economy.
Mr Gareth Thomas
I thank the Minister for his replies to many of my specific questions and the manner in which he approached his winding-up speech. I particularly welcome the fact that he will consider prioritising the Metropolitan line in the letter of agreement that he will sign with Transport for London following the spending review, and I am grateful that he will ask for a report on accessibility issues at Harrow on the Hill station.
I hear what the Minister says about further fiscal devolution being a decision for the Chancellor, but I gently suggest that he might want to use his not inconsiderable influence—he has been promoted—to press the case for the devolution of vehicle excise duty and stamp duty land tax. I heard his gentle sidestep of the request for a meeting with representatives of the workforce so that they could raise concerns about security, so I ask him to reflect on that. There are real concerns about security on the underground, not least as a result of the Leytonstone incident. Whatever he may think about unions in general, the workforce on the tube have reasonable points to make about security, so I encourage him to reconsider being willing to meet them.
I join my hon. Friend the Member for Poplar and Limehouse (Jim Fitzpatrick) in paying tribute to all the staff of Transport for London who do such an important job. I am grateful to their representatives—the Transport Salaried Staffs Association, the RMT and ASLEF—for providing us with briefings ahead of this debate. I am particularly grateful to TfL, London Councils and London First for their briefings, too.
This being the Christmas period, and while we are looking positively to the future of TfL, the last thing to say is I hope that there will soon be a Labour Mayor of London again. I particularly welcome the commitment of my right hon. Friend the Member for Tooting (Sadiq Khan) to a fares freeze, which gives some hope to my constituents that they will no longer be treated as cash cows for Transport for London.
Question put and agreed to.
Resolved,
That this House has considered Transport for London funding.
Spending Review and Autumn Statement: Wales
(8 years, 4 months ago)
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Christina Rees (Neath) (Lab)
I beg to move,
That this House has considered the effect of the Spending Review and Autumn Statement 2015 on Wales.
It is a pleasure to serve under your chairmanship, Mr Hollobone. Last month’s autumn statement was an opportunity for the Government to deliver a fair deal for Wales; to support Welsh families, to invest in skills and infrastructure and to give the Welsh Government the tools that they need to fund the vital public services that we all depend on. Unfortunately, however, the Chancellor of the Exchequer did none of that. Instead, he delivered yet more cuts to the Welsh budget and to the budgets of thousands of families across Wales.
Thanks to Labour’s campaign, the Chancellor was forced to abandon his plans to cut tax credits that would have hit 135,000 working families in Wales. However, we now know that those cuts have been delayed, not dropped altogether, and thousands of Welsh families will be hit just as hard through the Government’s cuts to universal credit. Families across the UK are expected to lose £1 billion this year and over £3 billion by the end of the Parliament because of the cuts to universal credit. The Institute for Fiscal Studies has predicted losses of £1,600 a year for 2.6 million working families and cuts of £2,500 a year for 1.2 million families who are out of work.
Although fewer than 6,000 Welsh people are currently on universal credit, the number will rise significantly over the next few years, as other benefits such as tax credits and jobseeker’s allowance are phased out. In my constituency, 656 people are currently on universal credit, but 14,250 people are claiming one of the main out-of-work benefits.
Working people in Wales will be worse off on universal credit, leaving those who are currently on tax credits with a perverse incentive not to take on a new job or extra hours for fear that it will change their circumstances and cause them to be moved on to universal credit. In Wales, 167,400 working families will feel the impact, 134,600 of whom are families with children.
In Neath, 6,200 families were on tax credits as of April this year; 5,300 of those were families with children, all of whom will be negatively affected by the changes and cuts to universal credit, should they take place. That neither meets the Government’s aim of making work pay, nor ensures that those on middle and low incomes are protected. Wales already has the highest level of child poverty of any of the nations of the UK. One in three children lives below the poverty line. Half of the people deemed to be living in poverty are actually working—an unfortunate truth that is often ignored when painting a picture of worklessness and a benefit-claiming culture of poverty and deprivation.
On the autumn statement, the Joseph Rowntree Foundation made it clear:
“There was little in this Statement to tackle the causes of poverty and it was a missed opportunity to support low income families. Without action”—
the foundation warns, our economic recovery will be
“built on rising poverty and insecurity.”
In Wales, we are particularly at risk, and the Chancellor’s plans are bad news for low and middle-income earners across the country. However, just as we successfully opposed his pernicious cuts to tax credits, we will continue to highlight the fact that the Chancellor’s plans will leave Welsh families worse off.
The autumn statement also saw yet another cut to the Welsh budget. Over the next five years, Wales will see a real-terms revenue cut of 4.5% and a cut to its overall budget of 3.6%. When Labour was in government in Westminster, we increased the Welsh budget from £7 billion in 1999 to £16 billion in 2010.
Jonathan Edwards (Carmarthen East and Dinefwr) (PC)
I congratulate the hon. Lady on securing this important debate. In my recollection, going into the last UK election, the Labour party said that it would broadly copy the fiscal policy put forward by the Conservative party. Will she tell us what the cut would have been to the Welsh budget under Labour?
Christina Rees
No, we did not actually say that—if the hon. Gentleman checks his facts, he will see that we did not.
As I was saying, by the time this Conservative Government leave office in 2020, we will have seen an 11% cut in the Welsh budget. For all the Government’s talk of economic recovery, they have delivered a mountain of cuts since 2010, and their decisions will do further harm to the Welsh economy over the next five years.
Craig Williams (Cardiff North) (Con)
The hon. Lady talks about 11% cuts to the Welsh budget, but how does that compare to the regions and Departments of England? She has not once mentioned the commitments on the national living wage. Will she welcome that as well as banging on with the diatribe we have heard on universal credit?
Christina Rees
The hon. Gentleman may think it is a diatribe but I do not—these are the facts, and the so-called national living wage is yet more rhetoric from the Conservative party.
In Neath Port Talbot, the county borough in which my constituency sits, the local authority has seen a cumulative cut of £65 million to its budget since 2010, not including this coming financial year, with further planned cuts potentially of £37 million over the next three years—a total of £102 million being taken out of its budget in eight years. That has meant its workforce has shrunk by 20%, and it is important to point out that those cuts have come as a direct consequence of UK Government cuts to the Welsh budget. That has hit local services hard, leading to the unwanted but necessary reduction in support for community facilities, such as libraries and leisure centres.
The IFS has estimated that the tax and social security changes introduced in the last Parliament cost the average Welsh family £560 a year and took £700 million out of the Welsh economy each year. According to the IFS, the Chancellor’s plans mean that Welsh households will lose a further £500 each year between 2015 and 2019, meaning an annual loss of £660 million to our economy.
The Chancellor made much of implementing a Barnett floor to ensure that the funding gap between Wales and England does not widen further. I welcome that announcement. Six years on from the Holtham report, which recommended such a floor, I am pleased that the Government have finally pledged to deliver that mechanism, but the simple fact is that the floor makes hardly any difference when spending on Wales is falling. What is unacceptable, and completely at odds with the recommendations of the Holtham report, is that the Barnett floor is only being set at its present level of 115% of spending in England for the duration of this Parliament, with the amount being “reset” at the next spending review
“to take full account of the Welsh Government’s new powers and responsibilities.”
Glyn Davies (Montgomeryshire) (Con)
Will the hon. Lady clarify something? If the 115% level is deemed to be too low, what level would the Labour party want to apply to Wales, in terms of the Barnett formula?
Christina Rees
We have to look at this issue. When spending in Wales is falling, that level is too low, so surely the best thing is to generate an economically viable situation in Wales so that spending increases.
Christina Rees
Not at the moment—I have to make progress.
We are all well aware of the Chancellor’s habit of slashing funding from central Government then expecting local government and the devolved Administrations to make up the shortfall. That policy ensures that the poorest areas are hardest hit. If the Chancellor plans to use the devolution of income tax to Wales as a cover to cut Welsh funding further and to lower the Barnett floor, that will understandably be seen by the people of Wales as an unacceptable outcome.
The autumn statement was also largely silent on the vital infrastructure projects that Wales needs. Despite its strategic importance to the Swansea bay city region, of which my constituency is a part, there was not a single mention of the Swansea bay tidal lagoon in the Chancellor’s statement. Along with the 22% cuts that the Chancellor announced to the Department of Energy and Climate Change, perhaps that silence signals the Government’s lack of commitment to green energy.
In light of the landmark agreement reached in Paris last weekend, we know that projects such as the tidal lagoon are essential if this country is to meet its international obligations to combat climate change. Unfortunately, although important progress was made in Paris, I understand that the pledges will not achieve the aim of limiting global average temperature rise to below 2 °C, so further action is urgently needed.
Craig Williams
I thank the hon. Member for giving way again. Will she take the point that there is also the Cardiff lagoon to consider, and that investors around the world are being shaken by what she and other Labour Members are saying about tidal lagoons at a very critical point, when we are negotiating the strike price? They are endangering lagoons, and not just the Swansea lagoon.
Christina Rees
I do not quite understand what that intervention means. We are not causing the uncertainty; the Government are.
The Swansea bay tidal project is also of critical importance because of the potential jobs and investment that it will bring across south Wales, as well as the apprenticeships promised to institutions such as the Neath Port Talbot College group. It is estimated that up to 1,900 jobs could be created during the lagoon’s construction phase, with many more jobs being created in the supply chains. Local businesses are eagerly anticipating the investment that the project will bring, so it would be a travesty if the UK Government failed to deliver this opportunity. Will the Minister confirm that the Government remain committed to the project and to agreeing a strike price for the tidal lagoon?
Another project that is of vital importance to the whole of south Wales is the electrification of the Great Western line from London to Swansea. Again, the Chancellor paid lip service to the scheme during the autumn statement, but he did not give any further details and now we know why. Since the autumn statement, it has emerged that electrification of the line between Cardiff and Swansea, which was due by 2018, will not be completed until between 2019 and 2024. That is an unacceptable delay and one that has the potential to damage the economies of south-west Wales, which will still be waiting for electrification years after electrification to Cardiff is complete.
Jonathan Edwards
Will the hon. Member take another intervention on that point?
Jonathan Edwards
I am extremely grateful to the hon. Member; she is being extremely generous in giving way again. I agree with everything she has said about the electrification to Swansea; we have been seriously let down on that particular issue by the UK Government since the election.
The comprehensive spending review came with the statement of funding policy document, which refers to High Speed 2. In that document, Wales gets a 0% rating, which has a drastic effect on the overall comparability percentage when the Barnett formula is applied. Can the hon. Member explain why the Labour Government in Cardiff are accepting the line of the Tory Government here in London that Wales will not lose out on many millions of pounds in the future because of that decision?
Christina Rees
That was such a long intervention that I cannot remember now what the beginning was. We also have north Wales to consider and surely—
Jonathan Edwards
The south Wales economy is getting blasted.
Sorry, Mr Hollobone.
Christina Rees
The news about HS2 comes just weeks after the Public Accounts Committee concluded that the £1.5 billion rise in the cost of electrification to Cardiff was “staggering and unacceptable”. It is now down to the Government to get a grip of the project, to ensure that the upgraded line is delivered quickly and with the maximum value for money for the taxpayer. With that in mind, can the Minister please tell us when he expects the electrification to Swansea to be complete?
The Chancellor was also noticeably lukewarm about proposals to develop city regions in Swansea and Cardiff, which are landmark developments with the capacity to transform transport and economic opportunity across 10 local authorities. The Welsh Government have committed £580 million to the project and the local councils have pledged £120 million, but the autumn statement just confirmed that the Government were committed “in principle” to the proposals. Can the Minister please confirm whether the UK Government will match the funding pledged by the Welsh Government?
Finally, the Chancellor confirmed that highly skilled Welsh workers in Wrexham, Swansea and Porthmadog will lose their jobs with the closure of more tax offices across Wales. We have already suffered through the closure of offices in Carmarthen, Merthyr, Pembroke Dock and Colwyn Bay in 2013, which, for example, forced workers from Colwyn Bay to travel to Wrexham to work. Are those employees now expected to travel to Cardiff to work?
The effects of the autumn statement will soon be felt by families across Wales, many of whom have suffered because of the last five years of cuts. The spending review should have been about delivering a sustainable settlement to boost the Welsh economy. Instead, the Chancellor avoided the big infrastructure challenges facing Wales and delivered another cut to the budget of the Welsh Government, and his cuts to universal credit mean that thousands of Welsh families will begin losing out from next year. What is more, we learned that the Government are removing the requirement of a referendum on devolving tax powers to Wales. I regret that the autumn statement did not have the interests of Wales at its heart, and people in Wales will suffer as a consequence.
The Parliamentary Under-Secretary of State for Wales (Alun Cairns)
It is a pleasure, Mr Hollobone, to serve under your chairmanship once again. I thank the hon. Member for Neath (Christina Rees) for securing this debate on the Government’s spending review and autumn statement. It is an opportunity to try to answer many of the questions that have been put, and to clarify the great opportunities that the autumn statement brings for our nation.
The Chancellor set out in the spending review and the autumn statement how the Government will deliver economic security, national security and opportunity for Welsh families. In Wales, the Government’s economic plan will build on the improvements made during the last Parliament. Since 2010, only London has grown more per head than Wales; unemployment in Wales has fallen by 26% since 2010; and in the last year alone, employment in Wales grew by more than 43,000. This investment continues to be made in this Parliament. Hopefully Labour Members will agree that the increase in capital funding for the Welsh Government—an increase of more than £900 million, or 16% in real terms, over five years—will support investment projects that matter to Wales and the Welsh economy.
It is interesting that the hon. Member for Neath focused on revenue expenditure, and at the close of her speech she talked about the lack of infrastructure investment. A 16% increase in capital spending certainly allows any infrastructure deficiency to be fixed by the Welsh Government. I suggest that all Members focus their attention on delivery, including the delivery by the Welsh Government of many projects, such as the M4 relief road, the electrification of valleys lines and other capital projects around Wales. When the hon. Lady’s predecessor, Peter Hain, was the Member for Neath, he cancelled the M4 relief road back in 1997. It is hard to believe that despite there being a Labour Administration in Cardiff Bay since 1999, we are still debating the same project, which is vital for the prosperity of Wales, given the commercial opportunities that it would create.
Jonathan Edwards
I am very grateful to the Minister for giving way, and his reply will be very useful to me as somebody who represents the communities in the west of our country. When the borrowing powers were awarded to the Welsh Government, was there a caveat that enhanced borrowing powers would only become available if the money was invested in the M4 relief road, or has that decision been made by the Labour Members in the Welsh Government independently?
Alun Cairns
I will happily write to the hon. Gentleman with further details. I can confirm now that the Welsh Government’s power to borrow up to £500 million for capital spending was initially due to start wholesale in 2018. The UK Government recognise that those powers are integral to the delivery of the M4 relief road, so early access to the borrowing powers was facilitated. The hon. Gentleman will know that that happened some years ago, but we are yet to see those borrowing powers being exercised to deliver that vital road project.
The hon. Gentleman will also know that during the recent rugby world cup, many demands and calls were made for that relief road. That is why, as I have pointed out, it was sad that that project was cancelled in 1997, following the previous Government’s decision to deliver that road.
Craig Williams
This is not just about the big projects. Our capital city is still without a ring road, and the eastern bay link has been on the cards for many a year. Even when it comes to smaller capital projects, the Welsh Government just do not get on and deliver.
Alun Cairns
My hon. Friend highlights another infrastructure project that has been called for. I can certainly remember that project from before the turn of the century. Businesses would welcome it. Bear in mind the resources available: the 16% increase in capital spend gives the Welsh Government the opportunity and the power. Instead of focusing on some of the issues raised today, this debate should focus on delivery by the Welsh Government, because all the resources have been put in their hands. The spending review saw more than just economic investment in skills and infrastructure.
Glyn Davies
On the implications of the autumn statement beyond economic development, one of the consequences that was not, I think, specifically announced in the Chamber on that day was a very big cut to the support for Sianel Pedwar Cymru, the Welsh language channel, from the Department for Culture, Media and Sport. Does the Minister share the disappointment that those of us who love the Welsh language—I know that that includes him—feel about that huge reduction in support? It may have an implication for the BBC’s support for S4C. It is particularly disappointing for the Minister and me because of our party’s record in stimulating the Welsh language and S4C over the past 30 years.
Alun Cairns
My hon. Friend raises an important point. S4C is crucial for the vitality of the language, and it creates social, cultural and economic opportunities. It would be wholly improper for me to provide a running commentary on the charter renewal negotiations. They are ongoing, but I am pleased to hear that Tony Hall said that broadcasting in the nations needs to be protected by the BBC, and I would hope that that would extend to S4C.
Susan Elan Jones (Clwyd South) (Lab)
The Minister seems to have forgotten a line from his party’s general election manifesto, which said that if elected, his party would safeguard the funding and editorial independence of S4C. How does he square that commitment with what happened in the comprehensive spending review?
Alun Cairns
The hon. Lady needs to recognise that the amount of funding from DCMS is relatively small. The proposal to cut from £7.6 million to £5 million over an extended period of time provides an opportunity for S4C to make its contribution to the savings. The spending review proposed £400,000 of funding savings from S4C in the first year, but she needs to recognise that negotiations with the BBC are ongoing, and to recognise the statements coming from Tony Hall. We welcome those statements and hope that the BBC will be able to deliver on them.
The Welsh Government’s total funding is underpinned by our commitment to introducing a funding floor, as the hon. Member for Neath said. I would have hoped that she would have welcomed the funding floor, because it was only two weeks before the autumn statement that there was a debate in this Chamber about the need for a funding floor. There was doubt that it would be delivered, but a funding floor of 115% will be introduced. That is well within the Holtham commission’s fair funding range, and I would have hoped that that would be welcomed by the hon. Lady.
Alun Cairns
The surveyor and architect of fair funding for Wales, Gerry Holtham, analysed the position and came up with a range of solutions. After the autumn statement, he said that it was a fair settlement. That is the fundamental point. There will be political commentary from all around, but the person commissioned by the Welsh Government to provide the assessment and establish the financial relationship between the UK Government and the Welsh Government has said that it is a fair settlement, and that is testament to the strength of the Administration in Westminster, which has delivered on something that has been talked about, but never delivered, by the Opposition.
Huw Irranca-Davies (Ogmore) (Lab)
My apologies, Mr Hollobone, for arriving a minute into the debate. On the 115% Barnett floor, why is it only for the term of the Parliament? What is the Government’s thinking behind that? The Minister will be aware of the worry that there is no long-term commitment. I am sure he will say, “Governments can only bind one Parliament”, but what is his thinking, long term?
Alun Cairns
Having been a Minister, the hon. Gentleman will know that no Government can bind another Government, though I would largely welcome a Government that could bind a Labour Administration, hopefully in the long-term future, to prevent them from pursuing the sorts of policies that they would want to introduce. Clearly, that is not how democracy works. It is obvious that this Administration can only plan for this Administration, and it would be wholly wrong and inappropriate to come up with commitments that bind any future Administration. The hon. Gentleman tried hard to draw something from me, but I hope he will respect the argument that he would be making, were he standing in my position.
I hope that Opposition Members recognise the commitment. The surveyor and architect of fair funding said that this was a “very reasonable” and fair settlement. Any political rhetoric on the issue needs to recognise the comments of that independent commentator.
Another element of the autumn statement enabled the Welsh Government to alter Welsh rates of income tax without a referendum. That offers exciting opportunities to attract new investors, and tax powers to reform the Welsh economy. The Welsh Government can take on more responsibility for how they raise money, as well as how they spend it. The National Assembly will finally take its place alongside other mature legislatures by being accountable to the people it serves. The new tax-raising powers put important fiscal levers in the hands of the Welsh Government, which they can use to grow the Welsh economy, to deliver new opportunities and to attract new investment.
Silk estimated that a 1p cut in the higher rate of tax would equate to a drop in revenue of £12 million. That is only a little more than the Welsh Government reportedly lost selling land in Monmouthshire, for example. Think of the opportunities that the cut of one penny could create: tens of millions of pounds might be spent on business support, or other discrete areas of the Welsh Government. People can now make a comparison: should they pursue one policy, given its cost to the taxpayer, or another, such as reducing the rate of income tax to attract investors and entrepreneurs to Wales?
Huw Irranca-Davies
The leader of the Conservative party in Wales has opened up the front on this matter by proposing a 5p drop in the top rate of income tax. That would equate to £40 million or £50 million, which is not a drop in the ocean in terms of the Welsh budget. It is curious that the leader of the Conservative party in Wales thinks that that is the best way to incentivise entrepreneurship, rather than investment in infrastructure, the innovation funds and everything else. Why does it have to be a cut in the top rate of tax? How many people on the frontline of our public services, including nurses and the police, have already been cut? Have the Conservatives made those calculations when committing to a 5p cut in the top rate of income tax?
Alun Cairns
The hon. Gentleman is demonstrating his misunderstanding, because he compares capital projects with revenue projects. The rate of income tax would affect revenue projects only. These are the sorts of policies that could be presented in a manifesto. People can choose whether they want to see money spent on pet projects of the Welsh Government or a cut in income tax. People will make their choices according to their objectives, but it is up to each political party to make its case. The whole point about the autumn statement is that it empowers the Welsh Government to make the case on whether it should be spending more or less.
Susan Elan Jones
Does the Minister think that Jobs Growth Wales is a pet project of the Welsh Government?
Alun Cairns
It is up to people to make judgments on what are pet projects. The point I am making is that we are in a serious debate. The opportunity to cut income tax rates is an opportunity to attract more investors and entrepreneurs to Wales.
In the 20 seconds that remain of the debate, I want to scotch any concern about the Barnett consequentials for HS2 funding in the autumn statement. The hon. Member for Carmarthen East and Dinefwr (Jonathan Edwards) has misunderstood the tables presented in the statement. We will happily go through it and write to him with the detail.
Motion lapsed (Standing Order No. 10(6)).
Specialist Neuromuscular Care and Treatments
(8 years, 4 months ago)
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Mrs Cheryl Gillan (Chesham and Amersham) (Con)
I beg to move,
That this House has considered access to specialist neuromuscular care and treatments.
Mr Graham Brady (in the Chair)
Mrs Gillan, you have the opportunity to speak to the motion.
Mrs Gillan
Thank you very much, Mr Brady. I was not sure whether you were going to say something more from the Chair before I spoke again. May I welcome you warmly to the Chair? Perhaps we will get through this debate together without knowing too many details about the procedure.
I also welcome the Minister to his position. When one is a Minister, one sometimes finds oneself in debates where it is déjà vu all over again, as they say. I am afraid that this is probably going to be one of those debates, but it is no less serious than the debate that we had last week on this subject, and I am grateful for the opportunity that the House has given me to reinforce that debate, by allowing this debate today. I see colleagues in the Chamber who were also here last week, and they will know how passionately I feel about this subject; indeed, many of my colleagues, from all parties in the House, feel passionately about it.
I really am delighted to have an opportunity to speak about this subject, because as I think we all know, there are more than 60 different types of muscular dystrophy and related neuromuscular conditions. It is now widely accepted that approximately 1,000 children and adults for every 1 million of the population in the UK are affected by these muscle-wasting conditions, and it is estimated that some 70,000 people right across the UK are affected.
I appreciate that there are other areas that we could discuss under this topic, and I am sure that we will hear from colleagues about them. However, I will use this opportunity to concentrate on muscular dystrophies such as Duchenne muscular dystrophy, on which I have been working hard with my constituents, the Hill family, in order to gain access to a drug called Translarna.
Around 2,500 children and adults in the UK have Duchenne and almost all of them are male. The condition is caused by the lack of a vital muscle protein called dystrophin. It leads to muscles weakening and wasting over time, and to increasingly severe disability. The vital heart and breathing muscles are affected, which often causes devastating cardiac and respiratory difficulties. In older patients, assisted ventilation can be required, which necessitates 24-hour care. Some patients have to undergo a tracheostomy procedure and, sadly, few people live with this condition past their 30th birthday.
Duchenne has a huge impact on families and on the individuals who suffer from it. Only about 100 boys are diagnosed with it every year in the UK, but it is hard to overstate the devastation to the individual and the surrounding family that it causes. The diagnosis is really hard to come to terms with, and the family must deal with huge challenges as the condition progresses and the patient grows older. It usually leads to full-time wheelchair use, surgery for scoliosis, which often involves inserting iron rods into the patient’s back, and the use of full-time assisted ventilation.
As the Minister knows, there is a very brave little boy who is my constituent. He is called Archie Hill and his parents, Gary and Louisa Hill, together with his brother, Leyton, have campaigned tirelessly for access to Translarna. To put things in context for my colleagues who are here for this debate, I can do no better than to use the words, once again, of Gary and Louisa Hill, which I hope will help people to understand the devastation that this condition causes:
“Being told your child will probably die before you, has to be the most devastating thing you can tell anyone. Archie was diagnosed in 2008. Over the next couple of years we became very reclusive, barely getting out the car at school drop off, sometimes not even answering the phone...we wanted to grieve on our own (grieving is not too strong a word). We’re angry, we look at other families and wonder why us?”
They wonder why it has happened to their beautiful child. They blame themselves, even though they know it is not their fault.
The emotional effect on siblings is really apparent, although I have to say that, having met Leyton, I know he is a fantastic support to his brother and to his mother and father. He is an integral part of this team and should be equally praised for his courage and perseverance. I know that he struggles with his concentration, and that he is deeply affected by his brother’s condition, but he is also a very brave little boy coping with this in his family.
Archie faces huge day-to-day challenges. His parents say:
“He is taken out of lessons for physio on a daily basis. He suffers from…mood swings”.
I find that hardly surprising. They go on:
“Every so often he will ask us questions about his condition; does it only affect my legs? Do I always have to take this medicine? Why do I have to wear the night splints?”
He asks all the sorts of questions that a child of his age would ask their parents when they knew that they were suffering from this condition.
Despite that, Archie has great stamina, and he has spent whole days here campaigning, marching up to Downing Street and telling the Prime Minister what he wants and what the Prime Minister should do about it. Quite frankly, he is one of the pluckiest little spirits that I have ever met in my life.
The Parliamentary Under-Secretary of State for Life Sciences (George Freeman)
indicated assent.
Mrs Gillan
I see the Minister nodding his head; I know that he agrees; anybody who has met Archie will know that what I am saying is true.
It is not just Archie who is affected by this condition. Sue Barnley, whose son Harry would benefit from Translarna, says:
“If Harry could get Translarna now whilst he is the best he is ever going to get, ie not gaining any more skills, only deteriorating then this will enable us to have more fun on a day to day basis. We gain a lot of support from our family and friends already, this will only increase as time goes on.”
She goes on to say:
“It seems cruel that the drug is there to make a massive difference in our lives, yet it is totally out of reach. Living with Duchenne is like living under a very dark cloud, we as parents know what Harry’s…future holds, to have some extra time living for the ‘here and now’ would make a BIG BIG difference, time to make and treasure some extra memories before our lives become totally engulfed by this awful disease.”
As the Minister knows, I have worked quite closely with Muscular Dystrophy UK and I have nothing but praise for that organisation, because it goes the extra mile for the people it represents. In my experience, the way that it deals with parliamentarians, offering them briefs and helping them, is second to none. It is an organisation that I trust, and I believe that it gives us the right information at the right time. It says that for older boys and men who have this condition, the respiratory function is compromised and the challenges get even greater for them and their families, because they have to engage with and face what many find to be truly frightening aspects of the condition.
One mother with whom Muscular Dystrophy UK works closely was called out to her son’s residential home at 2 am one weekend in September due to an emergency incident. Although her son was not hospitalised long term, he was experiencing increasing difficulties, and his mother told us that
“he is very conscious of his own mortality.”
Other young men are hospitalised frequently and often for long periods of time due to chest infections, which are very difficult to shift and are life-threatening. The current time of year is a frightening time for young men with Duchenne, because as we all know, respiratory infections abound, but in their case, hospitalisation is much more likely than it is for other people.
The Minister knows that Translarna is available from a company called PTC Therapeutics. We should put the benefits of Translarna in the context of a very short life. The early loss of the ability to walk is associated with a faster progression of the disease, and the later stages, as I have just described, are frightening and absolutely devastating. In a short life, the main goal is to spend as much of that life as possible in the best state of health and with the best quality of life. The National Institute for Health and Care Excellence—we are waiting for its decision on Translarna—must apply significant weight to any benefits that can be obtained through the use of Translarna in the context of that short and limited life. A delay in any of the devastating consequences of the disease, no matter how short, contributes to quality of life.
While Translarna is not yet licensed for use as an end-of-life medicine—it is still to be tested in clinical trials with older patients—evidence from existing trials shows that it delays the progression of the disease during a significant stage of a boy’s life. The trials also indicate that it is likely to delay the end of life, as a proxy measure. NICE has to give special consideration to the limited life expectancy of these boys when it is looking at this issue.
Translarna was the first licensed drug to tackle the underlying genetic cause of Duchenne and to keep boys walking for longer. Boys with the specific nonsense mutation of Duchenne, such as my constituent Archie Hill, have been waiting a year and a half since the European Medicines Agency approval in May 2014 for a decision on whether Translarna will be approved in England. It was a conditional approval, but the rubber stamp with it meant that the drug was then available in such countries as France, Spain, Italy, Germany and Denmark. That prompts the obvious question: if a European citizen can travel to any of those countries and get Translarna, why can they not get Translarna here in England?
I appreciate that there is a process that has to be gone through, and that due process needs to be followed, but it seems a cruel and unusual punishment that we have been waiting for more than a year and a half to see whether the drug can be made available to children in our country. As things stand, families face the prospect of a further agonising delay to NICE’s decision over Christmas. If I have stressed it once, I have stressed it over and over again: every day counts as those boys lose ambulation and become ineligible for Translarna.
Boosting clinical trial capacity for Duchenne muscular dystrophy is important. As Translarna becomes available for treatment, as I hope it will, it will apply only to 10% to 15% of boys with Duchenne. Other treatments are beginning to emerge. With the growth in clinical trials for Duchenne, specialist muscle centres—that is where the studies are conducted—are reporting that they are having to turn studies away due to a lack of resources and capacity. As part of a new initiative by Duchenne charities to address those concerns, Muscular Dystrophy UK has conducted an audit of clinical trial capacity and submitted that to the accelerated access review as evidence confirming that worrying picture. If the issue is not addressed, as the Minister knows—he is nodding his head in agreement—there is a risk that the promising drugs for Duchenne that are in the pipeline and in clinical trial will not continue to improve and meet their potential, hampering the search for effective treatments.
Muscular Dystrophy UK’s audit also found an excessively high clinical workload being placed on small and overstretched teams, which means that they are unable to participate in clinical trials through, for example, recruiting patients. That also means that children affected by Duchenne are unable to enrol in trials where they could access a new therapy. To aid the development of clinical trials, it is important that standards of NHS care for Duchenne patients are high across the country to ensure that patients on clinical trials are generally in the same state of health and physical shape. While there are some centres of excellence, such as Newcastle and Great Ormond Street, other parts of the country have much less developed services, and essential therapies, such as specialist physiotherapy, are not regularly provided.
Centres have also expressed concern that excess treatment costs—the additional costs of treating patients enrolled in research—are not being reimbursed to centres by clinical commissioning groups. That is a clear point of friction, and it limits the centres’ ability to take part in research. NHS England recently issued guidance on the issue, but it is not yet clear whether that will be enforced in practice.
Turning to the NICE guidelines on uncommon neurological conditions, a huge problem faces families and health professionals because there is no NICE guideline for any muscular dystrophies or neuromuscular conditions, which is why NHS England has asked NICE to develop clinical guidance on the assessment, diagnosis and referral of uncommon neurological problems. Muscular Dystrophy UK attended the initial scoping workshop on 11 November and will be participating in the consultation, which I understand has already started. While muscular dystrophies and neuromuscular conditions were listed as among the many conditions covered by the guideline and despite past assurances from NICE, there is concern that the focus on muscle-wasting conditions might be minimal unless the complexities of the conditions are highlighted. Given the internationally recognised standards of care for Duchenne and spinal muscular atrophy, it is disappointing that the NICE guidelines that are being developed are far more generic than the original guideline proposed by NICE to cover uncommon neuromuscular conditions in a letter to Muscular Dystrophy UK in November 2013.
Muscular Dystrophy UK has proposed that the guidelines should address the following: paediatric neuromuscular services specifically for Duchenne muscular dystrophy, in conjunction with current guidelines; the use of steroids as effective therapy in terms of the age when the optimal effect can be achieved, whether there should be a continuous or intermittent dosing regime, and how to manage the side effects; spinal surgery to correct or prevent scoliosis, with evidence regarding the optimum age and management pre and post surgery; and respiratory support, with a comparison of the evidence regarding invasive and non-invasive interventions, including comparisons with experiences in Denmark, where evidence suggests that men with Duchenne are living into their 40s because of the relatively high standard of respiratory support. So far as adult neuromuscular services are concerned, the guidelines need to address: diagnosis and the importance of GPs recognising the conditions, making early referrals and ensuring effective links from primary into tertiary care; respiratory support, as I have talked about before; and cardiac support, including regular monitoring to detect and address the deterioration of the heart through the progression of muscle-wasting conditions.
High costs can be involved in unplanned emergency admissions due to Duchenne and other muscle-wasting conditions, and in living with such conditions. There is a cost attached to not taking action to implement preventative care. Access to specialist multidisciplinary care, including access to respiratory, cardiac and physiotherapy support, can contribute to reducing avoidable, unplanned emergency admissions to hospital. A clinical audit of emergency hospital admissions that was led by Professor Mike Hanna revealed in June 2012 that 40% of these costly admissions could have been prevented if patients had been able to access expert tertiary care, specialist physiotherapy and—this is the worst finding of all—vital medical equipment. It has been estimated that addressing those issues could save the NHS more than £32 million a year as the appropriate proportion of NHS spending on neuromuscular services.
The cost of living with Duchenne is enormous. In the first study of its kind, academics found that the overall care for each patient with Duchenne cost the UK economy about £71,000 a year, giving a national total of £120 million. That survey was led by Newcastle University and a team in Sweden. Some 770 patients and their primary caregivers in the UK, Germany, Italy and the US were asked to complete a questionnaire on their experience of living with Duchenne and its impact on their need to access medical care, employment, leisure time and quality of life. The direct cost of the illness across all countries was at least eight times higher than the average health expenditure per person, and the figure for the UK was 16 times higher. The overall figures included medical treatment as well as the cost associated with the loss of employment among caregivers. In the UK, nearly half of caregivers reduced their working hours or stopped working completely owing to their relatives’ Duchenne muscular dystrophy. I therefore have several questions that I hope the Minister will answer during his winding-up speech.
When we discussed access to medicines last week in Westminster Hall, the Minister mentioned that he had made contact with NICE about both Translarna and Vimizin. I hope he feels that he may have reached a point with NICE such that he can talk about those drugs. I understand that they are used in similar situations, so if there is good news about Vimizin, we hope there will be good news about Translarna, and vice-versa.
Will the Minister provide more details on ensuring standards of care for muscular dystrophy and neuromuscular conditions? I really hope that clinical trials will be developed, so will he say a little more about that? I also want him to ensure that NICE gives more prominence to muscular dystrophy and neuromuscular conditions in the development of the uncommon neurological conditions guidelines, as was outlined in the original proposal.
Lastly, I hope the Minister will join me in congratulating Muscular Dystrophy UK on its work to develop information and resources for people with muscle-wasting conditions and to support health professionals through its “Bridging the Gap” project. More than 400 GPs and 150 physiotherapists completed the online learning modules about muscular dystrophy. The charity has sent out 4,500 alert cards for specific muscle-wasting conditions and 300 care plans, which is a positive step forward to improve how we treat and look after our patients with Duchenne.
I finish with a plea to the Minister. When I asked for this debate, as he knows, it was entirely based on trying to get Translarna cleared for Archie Hill. The Hill family went on holiday today, I think shortly before the debate began. I do not know what the Minister can do to speed the process along but, for the Hill family and Archie, and for all the other children and their parents at this time of year, if the Minister could ask NICE to bring forward a positive decision on Translarna, it would be the best Christmas present that any parent or child could get.
Several hon. Members rose—
Mr Graham Brady (in the Chair)
Order. Five or six Members want to participate and I want to get on to the winding-up speeches by no later than 3.35 pm. Although there is no formal time limit on speeches, if Members can keep their remarks to around six or seven minutes, we will be able to accommodate everybody.
Rachael Maskell (York Central) (Lab/Co-op)
It is a pleasure to serve under your chairmanship, Mr Brady. I congratulate the right hon. Member for Chesham and Amersham (Mrs Gillan) on speaking with such passion once again about her constituent and neuromuscular disorders. Such disorders often do not receive the profile of other medical conditions, yet for each of the 70,000 people affected, they are all-encompassing. I want to talk about a range of services and the challenges within them. I recognise that the conditions affect adults as well as children. I declare my interest as a physiotherapist who has worked in this field in the NHS for 20 years and is registered with the Health and Care Professions Council. I want to examine three themes: specialist services and how they are delivered; transition; and a timely response at the time of need.
I will deal first with specialist services. A multidisciplinary team is essential for delivering services to people with neuromuscular disorders, but access can often be challenging. District hospitals have teams of staff who specialise in paediatrics, neurology or other fields, but those people might not have the specific skills that are needed when dealing with neuromuscular disorders. Practitioners are practised in the principles of such conditions, but might not be as familiar with particular syndromes, given that there are so many—60 or more, as we have heard. This situation is likely to be exacerbated in the community when general practitioners and community physios do not have the specific skills, so it is important to ensure that people with these conditions can access those with the right skills who understand the pathology of the disorder and the specialist treatment that is required.
For instance, there are two specialist centres in London and one in Oxford for the whole of the south-east, so people have to travel vast distances to consult a specialist team. Owing to the nature of their disability, that can be very challenging, and the centres can even prove to be inaccessible, especially as their disease advances. How do we bring specialist services to those with neuromuscular disorders? How do we train staff to provide optimum care in the community, and how do we provide a rapid self-referral service when that is needed?
If I take muscular dystrophy as an example, paediatric patients in York benefit from Leeds general infirmary’s outreach service. That provides an opportunity for families to meet specialist practitioners but, obviously, some have to travel to those services. Will the Minister ensure that funding for that outreach hub-and-spoke model of service provision will continue and that clinicians will be able to travel to deliver their services, either individually or as a team?
It is important that services are placed in appropriate locations. For example, if a patient will benefit from hydrotherapy, we need hydropools to be available. Anisa Kothia, a member of the York muscle group, has a son, Yusef, who has Duchenne muscular dystrophy, and hydrotherapy is a vital component of his treatment. It relaxes his muscles so that his limbs can be taken through their range of movements, and the buoyancy of the water helps his movement. Will the Minister support a national review between the Department of Health and the Department for Communities and Local Government into hydrotherapy provision and ensure that any deficits are addressed?
Ongoing services rely on clinicians with less of a specialism, however, so that requires professionals to be trained and the provision of regular updates, which is why Gita Ramdharry, associate professor at St George’s, University of London, and Kingston University, has been working with Muscular Dystrophy UK to develop new online physiotherapy training. Will the Minister set aside resources to ensure that we can have specialist online training to equip professionals to provide the optimum treatment? Obviously, more specialist care training is also needed which, for physio, can be very hands-on.
I have had discussions with senior clinicians in other fields about global medical education. I think that that is relevant for neuromuscular disorders, because such disorders often require a global view that enables recruitment from around the world to participate in webinars, to examine case studies and academic papers, and to demonstrate learning by making a submission. We need to take medical training to another level, so will the Minister look at that more deeply, particularly with regard to neuromuscular conditions?
Before I move on, I want to highlight that much of the care for long-term progressive conditions is provided by the family. Good self-management is key, as Labour’s expert patient initiative has proven. If the professional knows the patient and their condition, the treatment will be optimal and will provide the best support. For example, a chest infection often accompanies a neuromuscular disorder, and a chest physio who knows the patient will know how best to support sputum clearance with a combination of the best postural drainage, manual support, and expectoration or suction techniques. Knowing exactly what the patient needs is critical, and can be life-saving.
All physios have the competencies required to treat a patient, but knowing the individual can make the difference. Rapid access to services can be transformative, and self-referral is very important, so will the Minister ensure that all services provide rapid-access routes to the appropriate clinicians and that all patients can self-refer, rather than having to go through the normal access channels? In north and west Yorkshire, we have only one neuromuscular care adviser to cover more than 3,500 adults and children. Will the Minister recognise the need to provide additional professionals in that role, including in north Yorkshire?
I have previously talked about the need to review the transition between child and adolescent mental health services, and adult mental health services. We should do the same for neuromuscular disorders, because using someone’s age as a measure is arbitrary. The pathology of Duchenne muscular dystrophy is more likely to be understood in paediatric services than adult services, owing to the number of children who, sadly, still do not make it to adulthood. A person’s medical team and physios know that individual and know how to progress their treatment. It is entirely arbitrary and nonsensical that someone’s birthday should determine that they have to transfer to another team.
Continuity of service provision is important. The condition of those who do reach adulthood is often at an advanced stage, so they need continuity. The findings in the field are that young adults are often lost in the service and then re-emerge later with problems that were preventable. Will the Minister take a serious look at the interface between paediatric and adult services right across the Department of Health, and particularly with regard to neuromuscular disorders, because surely specialism should override age?
We should be making a timely response to need. A worsening situation has been observed across the spectrum of neuromuscular disorders. It has been seen by clinicians in practice, and now constituents are writing to me about it. Orthotics, wheelchairs and equipment must be in place when they are needed. Infants and children grow, and disease processes may degenerate, so the combination of the two means that expediency is important. Patients are waiting far too long for appropriate equipment, and that is essentially an issue of under-resourcing and poor prioritisation.
If someone is measured for a chair, they need that chair, but people are waiting month upon month before their chair arrives. While they are waiting, they will be positioned inappropriately and might not even have enough support for their frame. That can exacerbate pain, as well as compromise a patient’s musculoskeletal situation and, dangerously, their respiratory function. There is absolutely no excuse for that. When a chair arrives, a patient needs it, so we need to ensure that we get the right equipment in the right place at the right time.
Planning for what equipment will be required is part of the management process, because people must always be prepared for the next stage, and the outsourcing of services has made the situation far worse. With life-limiting conditions, there is no time to wait. Will the Minister agree to carry out an urgent review of the situation? Will he ensure that, starting on 1 April 2016, there will be a waiting-time marker for the renewal and provision of equipment so that the time between the initial request for an assessment and the patient receiving the equipment is measured?
For someone with a rare condition, their future depends on the whole NHS and care service working around them to provide optimum support. I have not touched on research and pharmaceuticals, nor on advances in science, but there are things that can be done immediately that can really change someone’s outcomes. We need the best provision and to give individuals hope to ensure that we can extend their life and improve their quality of life. I look forward to hearing the Minister’s response.
Caroline Nokes (Romsey and Southampton North) (Con)
As ever, it is a pleasure to serve under your chairmanship, Mr Brady. I pay tribute to my right hon. Friend the Member for Chesham and Amersham (Mrs Gillan), who secured this important debate today. It is on a recurring theme which she brings us back to time and again. Not only does she work tirelessly to highlight the case of her constituent, Archie Hill, but she is extremely knowledgeable, so I will endeavour not to repeat any of her comments because I want to give other Members the chance to contribute.
Like my right hon. Friend, I have a constituent who suffers from Duchenne muscular dystrophy. Jagger Curtis is a pupil at Romsey Abbey primary school and is just eight years old. I have highlighted Jagger’s case in this Chamber before and I have raised it twice at Prime Minister’s questions, but, like Archie, Jagger is still waiting for an answer on whether he will be allowed to have Translarna. I will focus briefly on the issue of treatment, but mainly I want to echo my right hon. Friend’s calls, asking when families such as Jagger’s can expect to be notified of guidance from the National Institute for Health and Care Excellence on access to Translarna.
I know the Minister is aware of the time sensitivities of access to this drug—it has to be prescribed while the patient is still mobile—so I ask him to consider meeting me and my constituents, Jules Geary and James Curtis, who are Jagger’s parents, to discuss how the process might be accelerated. It might not necessarily be accelerated now, for their son, but it should be for the other hundred boys who will be diagnosed with Duchenne muscular dystrophy every single year. We have been waiting many months for a decision on Translarna, and every deadline appears to result in a decision to prolong matters further. There are concerns about the clinical trial capacity for drugs developed to assist neuromuscular conditions; will the Minister please assure me that he is actively promoting the network of specialist muscle centres as a means to overcome that problem?
Other issues associated with Jagger’s care have also raised huge concerns. He has had to wait far too long for his specialist wheelchair, and there seems to be little understanding that the chair is a lifeline for Jagger and his parents. Last week he went on holiday to Tenerife, and his wheelchair arrived literally just in time—the very day before he went on holiday—despite the fact that it was ordered back in May. The hon. Member for York Central (Rachael Maskell) referred to the fact that children grow and change, and their needs change. It seems to be an absolute tragedy that a child can wait all those months, and then by the time the chair arrives the danger is that it will no longer be correct for their condition.
Jagger still has his mobility, but his parents have done an arguably very difficult thing in making sure that he has that chair. Inevitably, as a child with a condition in which his muscles deteriorate, he tires really easily, so that chair is his lifeline and his access to continued mobility now and in future. He is still suitable for treatment with Translarna—he is one of the boys who has the nonsense mutation—but his family feels as though the clock is ticking very quickly.
Muscular Dystrophy UK has highlighted the problems with wheelchair provision throughout the country. Clinical commissioning groups are now responsible for commissioning wheelchair services. I am really conscious that in west Hampshire there have been delays for many people, not just Jagger. For those with neuromuscular conditions, as the hon. Member for York Central said, it is all about getting the right chair at the right time. It can be particularly devastating for children to have to wait for a chair that enhances their freedom.
I recently saw that Jagger’s mother had posted on Facebook a picture of him proudly showing off his new chair. However, it also said that the family had launched a GoFundMe page to buy a powered sitting and standing chair to enable Jagger to live his life as fully and actively as possible. It is heartbreaking that they are trying to fund that through GoFundMe because they do not have the confidence that the CCG is going to provide that sort of facility for them.
In the south-east we lag behind the rest of the country in the provision of neuromuscular care and adviser support. As we have heard, there are two specialist treatment centres in London and one in Oxford. That is a two-hour journey for a child in a wheelchair, coming via Waterloo, and his parents tell me that it is incredibly difficult for them to do that whenever Jagger needs to come to London for treatment. There is also a problem with specialist guidance. These families are looking for support—they need support, advice and information.
We are lucky that in Romsey we have brilliant GPs, but Jules Geary told me the tale of trying to get Jagger diagnosed. As a first-time mum, she was often dismissed as a worried mother, when in fact she was the one who knew her son best and knew that there was a problem. I do not blame the GPs at all, because if 100 boys are diagnosed every year, one would not expect a GP in Romsey to see it very often. It was not until James read an article in the Daily Mail about Duchenne muscular dystrophy that he pointed his finger and said, “Those are the same symptoms that Jagger has.” They took that article to the GP, and it was only then that the specialist tests were done on Jagger.
I know that we keep returning to this subject, but that is because it is important. It is right that we keep returning to it. Quality of life, especially for children, is crucial. I hope the Minister will look round this Chamber this afternoon and hear the cross-party and apolitical calls for help for those with such conditions, and I hope he will address some of the points that we raise.
Ms Margaret Ritchie (South Down) (SDLP)
It is a pleasure to serve under your chairmanship, Mr Brady. I congratulate the right hon. Member for Chesham and Amersham (Mrs Gillan) on securing this debate on a vital issue that affects many young people throughout the UK.
As the right hon. Lady said, neuromuscular diseases come in many different forms. In fact, there are about 60 different types of muscular dystrophy and related neuromuscular conditions, which makes it difficult for the NHS to provide clear-cut statistics on the number of people affected by such diseases. However, research undertaken by Muscular Dystrophy UK suggests that out of every 1 million of the UK’s population, approximately 1,000 children and adults are affected by such muscle-wasting conditions. On that basis, we can estimate that some 70,000 of our constituents, of whom approximately 2,000 live in Northern Ireland, are affected by those conditions.
Another way of totalling the scale of the issue is to look at the admission rates of those with neuromuscular diseases to accident and emergency departments. Muscular Dystrophy UK undertook work on that issue and found that in Northern Ireland in 2011, 787 people with a neuromuscular condition were admitted to A&E departments requiring emergency treatment, at an estimated cost of £2.2 million. Those figures are broadly in line with the GB average. There were 28,000 emergency admissions in the UK, at a cost of £81 million. Relying on the emergency services to fill the gaps in treatment for people with such conditions robs people of their independence and costs the NHS much more than a well-designed system that helps people to manage their conditions and avoids emergencies.
I am sure everyone in this Chamber is in agreement on this issue and wants the best possible treatment and care to be provided to people living with the effects of this cruel disease. Unfortunately, we are not there yet. There is still much work to do—in particular, on an issue that the right hon. Lady already referred to: Duchenne muscular dystrophy and the need for Translarna to be commissioned by NICE and approved by its guidelines. It is important that that happens, because Translarna is already in use in France, Germany, Italy and Spain. Families in those countries can use it, but families here are waiting for it.
Will Quince (Colchester) (Con)
One of my constituents has two sons with Duchenne. Does the hon. Lady agree that it is deeply regrettable that they are considering moving to France and commuting back to work so that their sons have the vital access to those drugs?
Ms Ritchie
I thank the hon. Gentleman for his intervention. I agree. His point illustrates that we urgently need a decision from the Minister. I hope the Minister provides us with some welcome information on that issue. It is deeply regrettable that families will go through Christmas not knowing for sure whether the drug will be approved. In the new year, NICE’s decision must not be delayed further. We must end the difficult wait of those families and children.
In Northern Ireland, there has been a commitment for more adult neuromuscular nurse specialists and adult neuromuscular consultants. I share the hope that, when combined with increased care adviser support, the new specialists will begin to improve our currently overstretched services, although there are still valid concerns about how that can be carried out effectively in the context of broader reorganisation and funding scarcity. If we are to achieve the standard of care we all want, much more must be done to co-ordinate better and join up services to ensure patients with muscle-wasting conditions get the help they need efficiently and effectively.
Before I conclude, I want to mention one of my constituents, a lady called Michaela Hollywood, who is wheelchair-bound and was born with spinal muscular atrophy. She was born without ears and is permanently in a wheelchair. She is now 25 years old. She received a Points of Light award, and on Thursday last week she was with the Prime Minister when the Christmas tree lights were turned on in Downing Street. She is on the BBC’s list of the 100 most inspirational women. She received her undergraduate and master’s degrees from Ulster University, and she hopes to go back to do her PhD. She is a lady of immense capacity. She is a campaigner for young people like her with muscle-wasting conditions and, although she spends every day of her life in a wheelchair, she very much enjoys every one of those days because she is a constant campaigner with enormous zeal for life.
Michaela gave evidence to the all-party group on muscular dystrophy in the Northern Ireland Assembly for its report on specialist neuromuscular care. What she said is most important, because it highlights the need for joined-up Government thinking, whether here at Westminster and in the Department for Health or in the devolved Administrations. She said:
“There’s physiotherapy and hydrotherapy, trying just to cover everything. I do receive physiotherapy but it’s a tricky issue because when you’re under 18, with a neuromuscular condition, you have respiratory physio in the community; when you’re over 18 and in the community, with a neuromuscular condition, you’re with disability physios, even though you’re deemed as having a respiratory problem. So that I think is something that is a prime example of the disjointed care that we’re receiving. If we have one specialist multidisciplinary team…that would make things so much easier. If we had a physio that concentrated on neuromuscular diseases but also had experience within respiratory areas, that would make things easier. Also, if we had a cardiologist who pretty much had a good knowledge all round, that would help too.”
Michaela’s words make the case for a joined-up service better than any of us could, so I will end by simply reiterating her appeal for specialist multidisciplinary teams for the treatment of muscular dystrophy to be established. I call on NICE to make its decision on Translarna with the utmost urgency. I hope the Minister will give us some favourable answers to alleviate the distress that is felt by many people throughout the UK.
Jim Shannon (Strangford) (DUP)
It is a pleasure to speak in this debate. It is always a pleasure to follow the hon. Member for South Down (Ms Ritchie), who made an impassioned plea on behalf of her constituent. Every one of us has constituents who suffer from Duchenne muscular dystrophy and other diseases and problems, so it is always good to make a plea on behalf of them in this Chamber. As always, it is good to see the Minister and the shadow Minister here.
I congratulate the right hon. Member for Chesham and Amersham (Mrs Gillan) on setting the scene for us all. She clearly outlined the issues, and asked questions of the Minister that we all endorse and support. I thank all other Members who have spoken. I am my party’s spokesperson on health, and I hope to find out about promising developments on the mainland that can be taken back to Northern Ireland, and that thoughts from Northern Ireland can be explained to the Minister. Perhaps the combination of the two can help us to look forward together, in ways that are to our advantage.
As other hon. Members have said, there are some 60 different types of neuromuscular condition, and it is estimated that around 60,000 to 70,000 people in the UK live with neurological conditions that affect their muscle function. Duchenne muscular dystrophy has been mentioned in particular. A couple of my constituents have that condition, and I am aware of the issues. At an event at the Methodist central hall across the way, people with the condition from across the United Kingdom of Great Britain and Northern Ireland clearly explained their needs, the issues—such as the massive advances in medical technology—and the best approaches. There are different levels of Duchenne, and what is medicine for one may not be medicine for another; that is the point I am trying to make.
In Northern Ireland, an estimated 1,600 people in the Southern Health and Social Care Trust area alone are diagnosed with neurological illnesses each year. That is equivalent to the number diagnosed with a major cancer; the conditions we are debating are of as great a relevance as some better-known ones. An estimated 34,000 people in Northern Ireland suffer from a disabling long-term neurological or neuromuscular condition such as epilepsy, multiple sclerosis, Parkinson’s disease, or one of the rare disorders such as motor neurone disease or muscular dystrophy, including Duchenne muscular dystrophy. Neurological symptoms such as headaches are one of the most common reasons for seeing a general practitioner, and they account for up to 8% of emergency department visits.
Last year, a new dedicated out-patient centre for neurology, with some responsibility for neuromuscular issues, was opened in Northern Ireland. That has been a positive development in the Province, helping with the nationwide momentum for access to treatment, and better treatment, for those living with neurological conditions. The new facility helps us to move towards meeting some of the latest standards in caring for people with long-term neurological and neuromuscular conditions. Since it opened, feedback has been very positive. Improved access to a modernised facility makes life much easier for patients and greatly improves their overall experience of their care.
I understand that the proposed multidisciplinary team will include neuromuscular consultants, neuromuscular physiotherapists and speech and language therapists, along with other care professionals. One of the key service outcomes, which I welcome, is that all patients with long-term neurological conditions have an individual care plan. The hon. Member for Romsey and Southampton North (Caroline Nokes) commented on access to wheelchairs; it is important for each individual to have a wheelchair that suits them. That might seem a small thing to some people, but to the patients it is massive. With 60,000 to 70,000 people in the UK living with neurological conditions, we must take those conditions seriously and prioritise our responsibility to those living with them.
A landmark decision could end the agonising wait for the delivery of the treatment that we are talking about to all those eligible to benefit in England, Wales and Northern Ireland. For those in Northern Ireland who benefited from the dedicated out-patient service I mentioned, I am sure this would be an additional boost. Nationwide, the momentum is now in favour of those living with neurological conditions. That may not always be how it feels, but there is a step forward, and we have to look at that, and at how to deliver that better. Although the move is very well intentioned and welcome overall, concerns have been raised and reservations expressed.
I know that the Minister will respond to what has been said about the NICE conditions. Lately he seems regularly to make particular reference to NICE in responding to debates in Westminster Hall and the main Chamber, and I think that is what Members are interested in. There is a need for a specific NICE response. It has asked for further clarification from PTC Therapeutics of the degree of benefit that its drug Translarna provides in the treatment of a type of Duchenne muscular dystrophy. DMD is one of a group of muscular dystrophies, which are inherited genetic conditions that cause the body to produce too little dystrophin, a substance crucial for muscle functioning. Seeing some of the young patients who have the condition focuses one’s attention quickly on how critical the availability of the medicine is. The condition leads to changes in the muscle fibres, which gradually weaken the muscles, resulting in an increasing level of disability. The decline in physical functioning in DMD leads to respiratory and cardiac failure and eventual death, usually before the age of 30.
Ataluren is the first licensed treatment for DMD that addresses the loss of dystrophin, the underlying cause of the condition. It has a conditional marketing authorisation in the UK for the treatment of DMD. The families of children affected, and Muscular Dystrophy UK, have campaigned for NHS England to make the drug available, since it became the first EU-approved drug for tackling Duchenne muscular dystrophy last August. The condition affects 2,500 people in the UK, causing increasingly severe disability and cutting lives short. It would be useful if the Minister and his Department could address NICE’s concerns, as it has asked questions. The right hon. Member for Chesham and Amersham referred to NICE and outlined four or five questions. I think that the focus that will emerge from the debate will be on how to improve the NICE guidelines and improve access to drugs throughout the United Kingdom of Great Britain and Northern Ireland.
Whenever I attend health debates in Westminster Hall, I ask whether we can have not just a regional strategy but a UK-wide one, bringing Northern Ireland, Scotland and Wales together. Will the Minister consider that? The four regions can benefit from each other’s knowledge. Collectively, we can do better.
Mrs Madeleine Moon (Bridgend) (Lab)
I want to speak not so much about Duchenne muscular dystrophy as about Parkinson’s disease and motor neurone disease—particularly the latter, which is also a neuromuscular condition. I will consider the problem of getting appropriate diagnosis and in-care support from neurologists. That is critical. We have already heard about the difficulty that those living in the wrong part of the country have in obtaining a quick diagnosis and the right support as they progress through the condition.
Neurological disorders account for up to 20% of acute medical admissions, and there are more than 60 different neuromuscular conditions. I was helped to understand the patchwork problem that people experience in getting access to neurological advice, support and guidance by a report commissioned in 2014 by the Association of British Neurologists. With 60,000 to 70,000 people in the UK living with a neuromuscular condition, there is considerable pressure on neurologists, and on specialist diagnosis and support. In 2011, a joint report of the ABN and the Royal College of Physicians, “Local adult neurology services for the next decade”, recommended that all relevant patients be admitted to hospitals that had an acute neurological service led by consultant neurologists. We are nowhere near that position now.
In 2014 a survey by the ABN found that the likelihood of a patient with a neurological problem being seen by a neurologist varies dramatically depending on where they live. The availability of a neurological review varied according to the type of hospital the patient was admitted to—whether it was a neuroscience centre, a neurology centre or a district general hospital, with or without neurological support. It was significantly better to be seen at a neuroscience centre, where there was support on 91% of days. Those who went to a neurological centre got support from a neurologist on only 80% of days. District general hospitals with a neurologist based at them had access to a neurologist on only 58% of working days. In contrast, access for patients at district general hospitals with no resident neurologist was available on only 32% of days. That is totally unacceptable, when we know that access to such neurological support dramatically changes the impact on a patient; there is an effect on their capacity to continue their life, and on their prospects of being discharged from hospital with a good quality of life.
I am concerned about the fact that access to CT and MRI imaging varies between hospitals. MRI was available 24/7 at only 30% of sites in the UK. The 2014 study identified a wide variation in access to specialist services for patients presenting with acute neurological disorders. As liaison neurology services change the diagnosis and management of a high proportion of patients, improving outcomes and reducing length of stay, there is an opportunity to improve both patient care and cost-effectiveness.
The all-party parliamentary group on motor neurone disease recently heard emotional and dramatic evidence from Mark and Katy Styles. Mark worked in local government and Katy was a secondary school teacher before she gave up work to become Mark’s full-time carer. Mark has a form of motor neurone disease called Kennedy’s disease, which is slowly progressive and genetic, passed from mothers to sons. He lives in Canterbury, and they have to travel to University College hospital in London to see a neurologist. That is nonsensical. Support should exist locally, because his condition may soon deteriorate to the extent that he cannot access the neurological support that he and his wife need. When Katy was working, she earned £150 a day. She now gets £67 a week to provide the on-duty, 24/7 care that her husband needs. We must recognise the invaluable work of carers and ensure that they get the necessary support.
Some 30% of people with motor neurone disease will die within one year of diagnosis. It is absolutely critical that they get rapid access to help and support for their condition. I will not repeat all the words that have been said about access to wheelchairs, but I stress that if someone with MND has the wrong wheelchair, they may not be able to communicate that. An ill-fitting wheelchair causes acute pain, but MND sufferers rapidly lose their speech and the ability to move their hands and upper limbs. They cannot communicate that they are in pain or distress, so the provision of wheelchairs is critical.
The APPG commissioned a report last year called “Condemned to Silence” about access to communication support. The issue is not money, because the Government have put money in place for communication support; it is poor roll-out, and something must be done to improve it. I look forward to hearing from the Minister what steps are being taken to ensure that people are not condemned to die without access to communication support, which they need to talk to their loved ones and carers about their needs, and to avoid suffering the indignity of being unable to communicate if they are admitted to hospital.
I have two final points. First, access to care support is critical as conditions deteriorate. People cannot wait for further assessments, or be put on waiting lists for care support, when they often need double-handling care support. If people are not to be condemned to lie in beds, support must be available immediately. Access to hoists and high-low hospital beds is often delayed. We must get faster at providing them. Secondly, access to finance to research such conditions is vital if we are to give families hope, and a sense that time and research will give them—and perhaps family members, who may inherit a condition—a better life in the future.
Richard Arkless (Dumfries and Galloway) (SNP)
I thank the right hon. Member for Chesham and Amersham (Mrs Gillan) for securing a debate on a subject that clearly touches many people for various reasons. It is also of course a pleasure to serve under your chairmanship, Mr Brady. Those Members who know my background as a lawyer and a businessman may be forgiven for asking, “Why are you here to speak about neuromuscular diseases?” I am not a member of the SNP health team, which is lucky to have the profound experience of my hon. Friends the Members for Central Ayrshire (Dr Whitford) and for East Kilbride, Strathaven and Lesmahagow (Dr Cameron), but I am developing something perhaps even more important and certainly more profound: I am living with motor neurone disease within my family.
If I can declare an interest of sorts, Mr Brady, my mother has motor neurone disease and, if Members will allow me, I will restrict my comments to that experience. I do not mean to sideline the 59 other important neuromuscular diseases; I want to ensure that what I say comes from a real place, not just a bunch of briefing notes. That notwithstanding, I want to add my voice to the calls to the Minister to persuade him to get Translarna approved as quickly as is humanly possible. I know that he looks sympathetically on that cause, and we have heard many vivid stories today about how it would affect people quickly.
Like everybody, I would lay claim to my mother—and indeed my wife—being the best that there is. She is the most selfless, dedicated mother in the world. She has literally lived her life for me, my brother, Nicholas, and my baby sister, Poppy—a baby who is now in her twenties. We have been her life. She has lived her life exclusively for us. My brother and sister and I will always be grateful for that. My mother was diagnosed 20 months ago. She kept it a secret with my dad for 16 of those months—thank goodness that she has my dad, with whom she has an unbreakable bond—so I have only been living with it for a few months. It is difficult and, as may become obvious during this speech, extremely raw.
During those 16 months, we witnessed the deterioration of my mother’s speech and joints. She explained the speech by way of fictional dentures that she had apparently had implanted. She explained the hands with reference to a historical arthritis problem in our family. Both were plausible and not really questioned up until the point that she decided to tell us. She did not tell me, my brother or sister or our extended family until after I was lucky enough to be in this place and make my maiden speech. She was determined that I should pursue my dream, and of course her dream, of making Scotland a better nation. I suspect that what she really wants now is a second referendum before it is too late, but I suppose that you get the point.
I will return to my mother later, but I want to pick up on some points made by other Members in this enlightening and touching debate. The right hon. Member for Chesham and Amersham is right to say that there are 60 different types of neurological disease, and I hope that she will forgive me for indulging myself with only one of them today. She talked about the Hill family, particularly Archie. I have this vivid image in my mind of Archie running up to 10 Downing Street and giving the Prime Minister what for—if only all of us could get that opportunity.
The speech of the hon. Member for York Central (Rachael Maskell) was touching indeed. She brings a wealth of practical experience, to which the Minister ought to listen carefully. I was particularly captured by her assertion that equipment needs to be made available when needed. It needs to be the right equipment in the right place at the right time, because time moves too quickly with such diseases. I hope that the Minister will pay careful heed to the hon. Lady’s practical experience, which has substantially benefited the debate.
I was particularly touched by the story of Jagger from the hon. Member for Romsey and Southampton North (Caroline Nokes). I hope that he enjoys his break in Tenerife and that the Minister will listen to calls for Translarna to be approved as soon as possible.
The debate has been consensual so far, and I want to take the politics out of what I am going to say. I want to touch on some things that Scotland is doing well on motor neurone disease, but I do not mean that to be a criticism of the UK Government. I hope that everybody’s ears are open. If we are doing things right, I sincerely hope that the UK can learn. If the UK is doing things right, my ears are open and Scotland can certainly learn. There is no politics in this whatsoever. As an aside, as new Member I have been frankly dismayed at how health services are politicised by both sides of the House. I have become increasingly amenable to the suggestion that perhaps the health service should not be run by politicians at all, but by people who have at heart the interests of the people whom we are here to serve.
Motor neurone disease is a neurological degenerative disease. In simple terms, the mind is fine and continues to operate with full function, but the body gradually gives up. The signals do not go from the mind to the body to make it work: that is how I think of it. Patients are affected differently. My brother-in-law died from it a couple of years ago, and his limbs were affected first. His legs started to give way for no apparent reason. However, my mother’s speech was the first thing to go—this was a lady who liked to talk, who seriously liked to talk! To have that stripped away from her must be incredibly difficult—and I know it is.
Scotland is doing many things well on motor neurone disease. Over the past year we have announced that we will double the number of motor neurone nurses. We are very much in the early stages, but the Scottish Government have provided funding to local authorities to ensure that things happen. At the moment local authorities are recruiting and assessing the need, and I hope that process will be speeded up as we go on.
That funding is a recognition of the difference that specialist nursing can make to motor neurone disease. My mother has to rely on a motor neurone nurse who comes from another region and who can only come on a part-time basis. A very proud woman, she was initially most reluctant to consider any form of help, but she has since come to realise what a benefit the nurse is. She has asked me to take up the cause of getting more motor neurone nurses throughout not only Scotland, but the rest of the UK—we are all human beings, despite our political views.
The change in Scotland has been praised in all quarters. Huge thanks are due to people such as Archie and Jagger. In Scotland a gentleman called Gordon Aikman, Christina McKelvie MSP, and all the staff at MND Scotland have done an incredible job of persuading the Government of the immediate need for those services. We have committed to giving a free voice box on the NHS and to paying families directly for support, not as a patronising gesture to pay people to look after their relatives, but to ensure that support is available if needed. We have also increased investment in palliative care.
I live in a town called Stranraer. The UK average is two people with motor neurone disease per 100,000; the Stranraer average is 13 per 10,000—an astronomical figure. I have asked the chief executive of our local health board to figure out exactly why—
Mr Graham Brady (in the Chair)
Order. I am sorry, the hon. Gentleman must resume his seat. I am loth to interrupt a very personal story, but we need to leave time for both the official Opposition spokesperson and the Minister to wind up. I have allowed more than eight minutes, and I am keen to allow the same to the official Opposition.
Barbara Keeley (Worsley and Eccles South) (Lab)
It is a pleasure to speak in the debate with you in the Chair, Mr Brady.
As others have done, I congratulate the right hon. Member for Chesham and Amersham (Mrs Gillan) on securing the debate. She gave a moving account of the Hill family in the light of Archie’s diagnosis and of the impact on Archie and his family of Duchenne. We have also heard excellent speeches from my hon. Friends the Members for York Central (Rachael Maskell) and for Bridgend (Mrs Moon) and the hon. Members for Romsey and Southampton North (Caroline Nokes), for South Down (Ms Ritchie), for Strangford (Jim Shannon) and for Dumfries and Galloway (Richard Arkless).
The all-party group for muscular dystrophy has carried out essential work to raise awareness and understanding of the needs of people living with muscular dystrophy and other neuromuscular conditions. I congratulate the APG on the quality of its inquiries and reports. The right hon. Member for Chesham and Amersham also paid tribute to the work of Muscular Dystrophy UK, and I join her in that tribute.
Providing access to treatment for people with muscular dystrophy is complex, because it is a rare condition. There are challenges in delivering localised, specialised care to people who have multiple, complex needs, but that cannot be an excuse for poor-quality care. As we have heard, some 70,000 people are affected by a neuromuscular condition in the UK. We must ensure that the NHS delivers equal treatment for equal need and that those with complex needs may have access to the treatment and support necessary to help them achieve the best quality of life possible.
In 2009 the APG’s Walton report showed clear deficiencies in the provision and planning of, and access to, care for people living with neuromuscular conditions. It found cases where care was “inadequate and not acceptable”. Although the report offered many sensible recommendations to improve the quality of care, the potential for progress was limited by the coalition Government’s reforms of the NHS under the Health and Social Care Act 2012.
Given those reforms, the APG undertook a six-month inquiry that considered their impact, releasing another report in March this year. Sadly, the reorganisation of the NHS and other reforms had done little to improve access to and availability of treatment for patients with neuromuscular conditions. Sadly, in fact, the reforms had made it even harder for patients to access support as a result of significant regional variations in the commissioning and funding of services. That is the nub of what I want to say.
There is a failure to join up services, and confusion about responsibilities and processes is a common theme. The hon. Member for South Down gave us an excellent quote on that lack of joined-up services. At the national strategic level there has been no specific mention of neuromuscular conditions in the five-year forward view, nor anything in the consultation document on the draft NHS mandate, which suggests a failure to recognise the specific needs of such patients at the strategic level. In fact, the five-year forward view groups together rare diseases and cancers, but there is a great deal of difference between all the conditions that we have discussed today and rare cancers.
There is a lack of clear guidance on which bodies in the NHS fund certain services and, as we have heard, sometimes people are not even receiving crucial respiratory support. Locally, there were examples of clinical commissioning groups failing to fund sessions of specialist neuromuscular physiotherapy or to provide sufficient funding for people to receive the right wheelchair at the right time. That is clearly so important and was mentioned by my hon. Friend the Member for York Central and the hon. Member for Romsey and Southampton North. It must be right for a child to have a comfortable chair while growing up.
The coalition Government’s reforms have also contributed to a delay in decisions on the availability of drug treatment for Duchenne muscular dystrophy, a life-limiting illness that affects about 2,500 boys and adults. The right hon. Member for Chesham and Amersham talked about that so well. To have to wait with a condition such as Duchenne for a decision on the drug Translarna is clearly agonising. It is a shame that the issue has been caused by NHS England halting its assessments to review its processes. I was not present at a Westminster Hall debate last week in which I understand that the Minister present said that he was “hopeful” that access to the drug would become available:
“I am hopeful about Translarna…NICE has been consulting on the process, and I believe the company has been engaging with NICE on pricing. I am hopeful that there will be a decision in the next few months”.—[Official Report, 8 December 2015; Vol. 603, c. 274WH.]
As he went on to say, however, the decision is not in his gift.
I hope that the Minister’s optimism is well founded, because as we have heard today it must be recognised that time is an important factor. The decision is different from some others, because the timing can affect the benefit that the boys will receive. I wish to ask, as everyone else has done, about that decision, and what he is doing to ensure that delays do not happen again. We must ensure that system of wider support is available for patients and their families and carers. In some cases people need 24-hour support and care; homes must be adapted; physiotherapy, speech and language therapy, and occupational therapy need to be available; and carers need access to the right advice and support, as has been said.
I am concerned, like others, that the Government’s failure to protect social care funding and other non-NHS health funding, such as training budgets, will mean that that wider network of support is not available when needed. The Walton report highlighted issues with social care back in 2009, but since then the number of people with access to publicly funded social care has fallen by 25%. The availability of the right support for people with specialist care needs is unlikely unless we have a sustainable funding settlement for both the NHS and social care. The difficulty with recent funding announcements, if the Minister intends to refer to them, is that the 2% social care precept and the better care fund are back-loaded funding mechanisms, with nothing this year and little next year.
We have heard about the regional differences in access to care. The Walton report highlighted that there were only 13 neuromuscular care co-ordinators when 60 were felt to be needed. My hon. Friend the Member for York Central said that there was only a single neuromuscular care adviser in North Yorkshire; in fact, no neuromuscular care adviser support is available for adults living with such conditions in Greater Manchester or the surrounding areas of the north-west. That is in spite of the fact that an estimated 8,100 people with a muscle-wasting condition live in the north-west. There is a need to ensure that clinical commissioning groups and other regional health organisations are aware of their responsibilities. Sadly, the findings of the 2015 APG report suggest little progress in the issue of unequal access.
Given the devolution deals on health and social care in certain parts of the country, will the Minister assure us that the inequalities in specialised services that we have heard about will be addressed and that the relevant bodies will be made aware of their responsibilities, which they do not seem to be at the moment? The debate has highlighted the fact that we have ingrained problems in our health and social care system. The lack of a sustainable funding settlement for social care and other recent reforms have led to fragmentation and instability in services. That means that inequalities in care sadly will continue. I urge the Minister to consider in full the most recent report and recommendations from the APG. We must ensure that people with neuromuscular conditions receive the care that they need, and that those inequalities in care are addressed.
The Parliamentary Under-Secretary of State for Life Sciences (George Freeman)
It is a pleasure to serve under your chairmanship, Mr Brady. I am left with 10 minutes in which to try to deliver my speech and the answers that I have carefully prepared while listening to colleagues’ comments. If I run short of time, I will undertake to write to everyone in the Chamber with answers to the points raised.
I start by paying tribute to my right hon. Friend the Member for Chesham and Amersham (Mrs Gillan) for securing the debate. She is a tenacious advocate on this issue, as on others. I join her in paying tribute to Archie and his family. I have met patients who suffer from these diseases and their families, and one’s heart goes out to them. One wants to pay tribute to the bravery with which they deal with their conditions. As is so often the case in the history of medical progress, the families, patients and carers are those who advocate and, in the end, win through to make their point heard, with the help of colleagues from across the House. My right hon. Friend eloquently paid tribute to the families of children with these disorders and diseases who, in many ways, suffer every bit as much as the patients who show such incredible fortitude. She asked me last week whether I would give her an A grade for effort and persistence. I will happily give her an A-plus in this end-of-term summary, but the people to whom we really want to give an A-plus are NICE and NHS England.
I want to touch on some of the excellent points that were raised. My right hon. Friend raised Vimizim and Translarna, so I will say something in detail about the timing of those decisions in a minute. She also made an important point about standards of care across the NHS in clinical trials, which was mentioned by numerous colleagues, and the importance of NICE giving more prominence to the time aspect of these conditions, which are unusual because they can deteriorate with every week’s delay in getting treatment.
The hon. Member for York Central (Rachael Maskell) gave us the benefit of her front-line clinical expertise. In case I run short of time, I shall say now that I will happily convene a meeting at the Department of Health with officials from my Department and NHS England, to which I invite colleagues from all parties who want to discuss the issues she and others raised about front-line care, because a range of practical issues about such care has been raised, in addition to access to drugs, and giving colleagues the chance to raise such points on behalf of their constituents would represent a powerful opportunity. The hon. Lady talked in particular about training and the interface of paediatric and specialist services, which I come across in connection with numerous different specialist conditions.
My hon. Friend the Member for Romsey and Southampton North (Caroline Nokes) spoke passionately about James, Jules and Jagger Curtis, and the importance of expediting those particular decisions and quicker assessment, as well as adoption in general. That is a passion of mine, which was why I launched the accelerated access review to look systemically at what we can do to expedite getting new medicines into the service. She also touched on the importance of wheelchair access.
The hon. Member for South Down (Ms Ritchie) talked eloquently about Michaela and the importance of specialist, multidisciplinary teams. The hon. Member for Strangford (Jim Shannon), who gets the prize for appearing in more debates with me than any other Member of the House, which is a tribute to his activism as the Democratic Unionist party’s spokesman on these issues, highlighted the importance of Belfast as a hub of research and regional strategies in Northern Ireland and spoke about his constituents. This is a devolved matter, and while I pay tribute to the work of researchers and medics in Northern Ireland, it is important that the devolved Administration in Northern Ireland put in place a similarly enlightened commissioning process.
The hon. Member for Bridgend (Mrs Moon) raised the broader issues of Parkinson’s and neurological disorders, while the hon. Member for Dumfries and Galloway (Richard Arkless) spoke passionately about his mother’s suffering. Before I came to Parliament, I worked in Scotland and, as he highlighted, in this area, as in several others, Scotland pioneers some of the clinical commissioning work. The supreme irony of the debate was brought to light by his request that we depoliticise the NHS. For me, one of the greatest steps following the Health and Social Care Act 2012 was the separation of the NHS from the Department of Health. NHS England now operates under its own arm’s length management, subject to a mandate from Ministers
We do not control the NHS—believe me that if, for one afternoon, I could do that, I wish it was now. I would love nothing more than to pull the lever and give all these children the drugs that we all want them to get before Christmas, but that is not in my gift, and I suggest that it is in all our interests that it is not. It is right that such decisions are taken by NHS England and clinical professionals, advised by the very best people at NICE.
Barbara Keeley
It is important that the NHS mandate covers these conditions because at the moment it does not. Something must be done to make sure that they are covered.
George Freeman
In the few minutes I have available, let me say a few things about the main issues raised. I pay tribute to Muscular Dystrophy UK, Robert Meadowcroft, Emily Crossley, the Duchenne Children’s Trust, Action Duchenne and all the other organisations that work so hard in this area, and specifically on the two or three key drugs.
I remind the House that the decision from NICE on Vimizim is due before the end of the year. Without breaching due process, I have asked that, if that decision is in the pipeline, it can be made as quickly as possible, ideally before we all break up for the Christmas holidays. That is not in my gift, but I made that request. Similarly, I have requested that the Translarna decision, which I believe is due in February, is similarly expedited. However, again, that is not in my gift, and while during the year the Prime Minister and I have urged NICE and NHS England to do everything they can to expedite their decision making on those drugs, we do not have the power—rightly, in my view—to step in and breach process. It is fair to all patients in the NHS that decisions are taken properly.
Mrs Gillan
The Minister has given us a sympathetic hearing and I know that he has done everything in his power to try to bring forward that decision. Quite rightly, it is not his decision to make, but, through him, may I appeal to the men and women who are making that decision? If they have any humanity about them, they ought to make a positive announcement before Christmas.
George Freeman
My right hon. Friend made the point more powerfully that I could. On Vimizim, I am delighted that BioMarin, the company concerned, has, following exhortation from me and others, sat down with NHS England and gone through pricing flexibilities. I have been able to grant an access agreement. The drugs are incredibly expensive, which is what makes NICE’s work difficult, so if anyone from PTC Therapeutics, the company responsible for making Translarna, is watching, I urge them to sit down with NHS England and adopt a similar approach.
On specialist commissioning, we lived through and focused on difficult decisions, and this summer NHS England agreed to 23 new treatments, including Duodopa, which controls the symptoms of patients with Parkinson’s disease, wider access to proton beam therapy, and extending treatment with ivacaftor for cystic fibrosis involving G551D mutations.
We live in an age of extraordinary biomedical progress, but budgets struggle to keep up with the rate of progress that our scientists and researchers make. I know that this is of little comfort to my right hon. Friend and to Archie and his family, but I hope that hon. Members agree that, in deciding which treatments should be procured on behalf of us all, due process must apply. However, I share their frustration, which was why I launched the accelerated access review, which will report independently to me in the spring. That substantial piece of work is examining whether we can do more to embrace breakthroughs in genomics and informatics to give NICE and NHS England new flexibilities to speed up how innovations for patients are assessed, as well as to explore new pathways and flexibilities for different models of reimbursement to get innovation through quicker.
I want to pick up the point that was made about specialist neuromuscular care. The truth is that there are few curative treatments for most of these diseases, so we are talking about the importance of routine care for people that is provided by local primary and secondary care services via local CCGs. However, a number of specialist services have been designated among the 146 that NHS England is responsible for commissioning nationally, which are set out in legislation and commissioned directly by NHS England through 10 area teams. Twenty-five specialised neurological treatment centres across England ensure that patients can access high-quality neurological care where they live.
As I said, I will be happy to convene a meeting in the Department with officials and NHS England to talk about how we can address some of the practical issues raised when providing front-line, integrated services. I fear that the clock is against my being able to go through the 22 questions for which I had answers prepared, so I close by saying that while we all would want to pull a lever to make this happen quickly, the truth is that we need a system that is rigorous, robust and evidence-based, but quicker, in recognition of the effects on these patients.
Motion lapsed (Standing Order No. 10(6)).
Weymouth to Waterloo Rail Line
(8 years, 4 months ago)
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Richard Drax (South Dorset) (Con)
I beg to move,
That this House has considered the Weymouth to Waterloo rail line.
It is a pleasure to serve under your chairmanship, Mrs Moon, and a great pleasure to see the Minister here, whom I regaled, for half an hour of her precious time, only about two hours ago, so I thank her for that. It is very nice to see her in her place.
Welcome to a number of colleagues, and to a right hon. colleague, my right hon. Friend the Member for West Dorset (Mr Letwin); it is a particular pleasure to see him here. I will talk for about 10 minutes, then another colleague would like to say something, and I think others want to intervene. After that, the Minister will obviously respond.
I start by saying that Dorset is one of the most beautiful and unspoiled counties in the country, with a Jurassic and world heritage coastline that is the envy of the world. That combination of sea, coast and countryside attracts millions of visitors and tourists. At the height of the summer, the road system struggles to cope and frequently does not. That is not to say that we are all crying out for a motorway—indeed, the lack of one is part of the attraction. However, we simply cannot sit back and depend on seasonal jobs, which do not provide a secure enough career and future prospects for many of our constituents. We need to attract investment into the area, and rail connectivity is key. The lack of it already makes things very hard for those who live and work in Dorset, thwarting many ambitious plans.
Take Portland port, which is a growing port: commercial road traffic there is expected to treble in the years ahead, and the number of visiting cruise ships continues to rise, dropping off countless thousands of customers, who then go into all our constituencies. In the centre of my constituency, a newly announced enterprise zone on the outskirts of Wool is expected to generate thousands of jobs—so too, hopefully, are our expanding marine and engineering industries, new museums and tourist attractions.
For all those to work, we need to improve our infrastructure, and with little scope for more roads, for reasons I have explained, rail is the only option. There has been a railway line to Weymouth for 148 years. The terminus, originally designed by one of Brunel’s assistants, sits only yards from the resort’s golden beaches. The line was decisive in opening up the town, which was first made fashionable by George III and his followers in 1789, hence the façade. It is not hard to imagine the scene as the early tourists enjoyed the waters from their wheeled bathing huts. The same train continued to the Channel Islands ferry terminal at the mouth of Weymouth harbour, winding its way through the town, led by a man waving a red flag to clear the way. Times have changed, but the significance of rail travel has not, and if we are to ensure that both Weymouth and Portland can thrive today as they did back in the 19th century, some imaginative thinking is required.
Two trains an hour serve Weymouth from Waterloo. Typically, they take three hours to travel only 130 miles, so the time is considerable. There is an infrequent and sporadic service to Yeovil and Bristol. With the aim of speeding up trains to Weymouth, I began to investigate the various possibilities with South West Trains. We came up with three options. The first was to run a faster, third train in each direction on the current route via Bournemouth and Southampton, but that would require substantially more power, platforms and rolling stock, making it expensive and, due to the bottleneck in the New Forest, essentially unworkable. Even if multimillions of pounds were spent on new electricity substations, the increasing number of passengers from projected new housing developments would give any franchisee little flexibility to drop a station in order to generate faster journey times on a line that is already run to capacity.
The second option is to make one of the two hourly London trains “fast” and the other “slow.” However, the negative impact on intermediate stations effectively rules that out. The third option is via Yeovil, and I and many others—not least the colleagues sitting around these tables—believe that that is a goer. With much of the infrastructure in place, it is more affordable and has major advantages. It would: reduce the journey time from Weymouth to London to two hours and 25 minutes; provide more room for passengers on the existing line through Bournemouth and Southampton; expand capacity and business opportunities across a number of south-western constituencies; connect Dorset to Heathrow—I sorely hope that the planned expansion there eventually gets the go-ahead—and take up some of the ample capacity on the Weymouth-to-Bristol line.
The proposal would mean an additional service to Waterloo via Yeovil and Salisbury, with reduced stops, calling at Weymouth, Dorchester West, Yeovil Junction, Salisbury and London.
Michael Tomlinson (Mid Dorset and North Poole) (Con)
I am very grateful to my hon. Friend for giving way and for securing this important debate. Does he agree that if the new route via Yeovil goes ahead, it still has the potential to benefit my constituents, who neighbour his, by increasing capacity on the trains, hopefully thereby increasing rail use and relieving a great deal of pressure on our roads, particularly in and around Wareham?
Richard Drax
I entirely agree. As my hon. Friend well knows, the charity railway, which will be linked from Swanage to the main line through Wareham, will also play its part, which is very good news. And yes, that will relieve pressure greatly on the line through his constituency. I have also heard today that he and others are looking at a new metro service running between Christchurch and Wareham, or something of that nature. In itself, that will take up more capacity on the line, which makes my plan less workable, although his constituents will be able to travel backwards and forwards more efficiently and more ably, which is very good for him and others.
The work needed for the third proposal would be relatively minimal—certainly less than would be required on the Bournemouth-to-Southampton line. That work includes some short stretches of new track, enhancements to platforms at Weymouth, Yeovil and Salisbury, an increase in the speed limit on parts of the line, and the extension of a footbridge. I—or we, I should say—believe that none of those is impossible.
John Glen (Salisbury) (Con)
Does my hon. Friend not recognise the absolute imperative, however, of having clarity about the infrastructure costs required, and particularly the cost of dualling the track between Yeovil and Salisbury, which would be key to unlocking a secure future for his plans?
Richard Drax
My hon. Friend makes a very good point. In fact, it is key, as the Minister well knows, because this is a point that we raised with her only an hour or two ago. I say to her gently and humbly that if Network Rail could possibly do the study and come back with some sort of affordability plan, that would help us. We went away from the meeting that the Minister kindly held feeling very positive. At the moment, the local enterprise partnerships all down that line—this is the plan—would be very keen to draw up some sort of business plan and come back to her. What we do not want—my hon. Friend the Member for Salisbury (John Glen) mentioned this—is to do all the work, and for Network Rail to come back and say, “That’s not how we did it,” or “They have missed out this or that,” or “They haven’t put this into the equation.” That would be unfortunate, particularly if a great deal of money was spent on the report that the LEPs are considering drawing up. Some clarity from the Minister at the end of the debate would be most helpful.
It is estimated that the plan for a service via Yeovil would take between three and five years to complete; as with all these things, it would not happen immediately, but it chimes with the Dorset local master plan to reconnect the south and north of the county by train for the first time in almost 30 years, and to link Dorchester and Weymouth to Exeter in the west. As the Minister knows, the Members to my west, east and immediate north are all involved in this potential project and would benefit equally. We are all in this together.
I and many others believe that the proposal would have a dramatically beneficial effect on Weymouth and Portland and, as discussed earlier with the Minister, the whole region. Weymouth and Portland would be connected to a vital east-west arterial route, and that would promise better access for businesses, visitors and tourists, and hopefully generate more investment in the resort.
It is lovely to see my right hon. Friend the Member for West Dorset here. Dorchester would play a key role because it is in a key location. With the housing on the Prince of Wales’s land—this was discussed with the Minister earlier—and other developments across that part of the world in the years ahead, we must have an updated, modern railway system; otherwise, we will simply not cope.
Mr Oliver Letwin (West Dorset) (Con)
It is absolutely true that my constituents in Dorchester and Sherborne, and indeed those between them, would hugely welcome the plan that my hon. Friend is describing. Does he agree that if we could get the LEPs to co-ordinate with Network Rail on the specifications of the report, we should be able to establish a very strong business case?
Richard Drax
I entirely agree with my right hon. Friend. It would be useful to have some clarity from the Minister. We are very willing to help out and to do our part, but some guidance from Network Rail would be hugely helpful, so that it does not say that all the work that we have done does not come up to scratch. Some negotiation between the two parties would be hugely beneficial.
The knock-on effect—all good—would be dramatic for train times. Pending a study, it is estimated that Weymouth to Waterloo would take two hours, 25 minutes; the typical time now is three hours. If there was a direct service from Salisbury to London, that time could be reduced by a further 10 to 15 minutes. That would have a knock-on effect for the rest of the region. Yeovil to Waterloo would take two hours; Honiton to Waterloo would take two hours, 30 minutes; Exeter to Waterloo would take two hours, 50 minutes; and north Devon—a crucial area that is growing and has very little rail network—to Waterloo would take three hours, 55 minutes. If the non-stop Salisbury to London service introduced a third service in the hour, it would greatly reduce the time—by another 10 to 15 minutes. My hon. Friend the Member for Salisbury is very keen on that.
I have done the train journey to Weymouth in my constituency; three hours is a long time for visitors and businesses, and is beyond daily commuting. What we need, as I am sure the Minister knows, because she has been to my part of the world many times, is to break away from the seasonal hole. It is important to my constituents; they can have longer-term careers and prospects only if we attract investment. I have said, and will say again, that because of the inability to improve our roads dramatically—we can tinker at the edges—rail connectivity really is the key, just as it was for George III and his team. If it was good enough for him, it is good enough for my constituents.
As the Minister knows, the Yeovil option has the support of the local chamber of commerce and the local enterprise partnerships up and down the line. I know of two that are behind it, and further work has been done. I cannot see them not being involved. Weymouth and Portland Borough Council, North Dorset District Council, bordering LEPs and councils, my right hon. and hon. Friends who are sitting around me, and many others who are not here would benefit. I am sure that those who are not here would have been here, if they could.
Bringing these huge benefits to so many for a relatively modest investment in railway terms—the Minister said how amazing it was that even a little work costs a lot of money, but in railway terms, this would be a fairly modest investment—would be an achievement that we could all be proud of. Dare I say that as Conservatives—I am proud that we have a Conservative Government—we always go on about jobs, prosperity, wealth and the northern powerhouse, which I totally accept and am totally behind, as I am sure are my colleagues, but how about the south and south-west powerhouse? It depends so much on rural activities, and we need all the help we can get.
I have requests for the Minister. First, will she consider commissioning Network Rail, with the LEPs, if indeed that is the way we go, to undertake a study to look at this idea? Secondly, will she instruct the Department to include the scheme in the south-western refranchising specification, if indeed that is possible? I believe this project is innovative, affordable and doable, and has far-reaching benefits for my constituents and those represented by MPs who are here, and those who are not here. Let us not forget that one of them—the right hon. Member for Exeter (Mr Bradshaw)—is a Labour MP; I am sure that if he knew this debate was taking place, or could attend, he would be just as keen on the project. I hope that the Government will play their part in making it happen.
Mrs Madeleine Moon (in the Chair)
Before calling Mr Fysh, I alert him to the fact that he has an allowance of four minutes before the Minister needs to sum up.
Marcus Fysh (Yeovil) (Con)
Thank you, Mrs Moon. It is a great pleasure to follow my hon. Friend the Member for South Dorset (Richard Drax). Delivering jobs and opportunities to the south-west is at the centre of my mission as an MP and a major focus of our Government. Somerset is a key gateway to the south-west and presents substantial economic opportunities, including in Dorset, as we have heard.
The Government are spending a massive amount on dualling the A303 and A358 corridor, and this scheme would be a perfect complement to that. It would enhance the prospects for jobs as well as networking our centres of economic growth to allow them to grow more rapidly together than would otherwise be the case. Double tracking the line between Templecombe and Salisbury is essential for that and could unlock substantial further growth. Importantly, it would help a great deal while the A303 work is being carried out because that will probably cause serious congestion that might otherwise present a substantial challenge to the area.
It is important that the analysis of the potential upgrade is carried out in a joined-up way with, and at the same time as, the current analysis on double tracking west of Yeovil. Network Rail is undertaking that analysis as part of its investigation into increasing the resilience of the south-west peninsula. It is hard to think about how trains will be scheduled and what enhancements are necessary without looking at capacity over the whole route at the same time.
South Somerset, of which Yeovil is the key town, has ambitious plans for growth in housing and industry, and would be greatly enhanced by the plan for better rail connectivity, which could bring Yeovil closer to London by up to 40 minutes. That would represent a real step change with knock-on benefits for the whole of the south-west, including Devon and the rest of the south-west peninsula. I cannot emphasise the idea of networking enough. Whenever I have looked professionally at economic projects around the world, the element of new public infrastructure to connect places and reduce journey times, thus raising economic potential, has been a major feature. This is a major plan for jobs and opportunities in the south-west, so we must grab it with both hands.
The Parliamentary Under-Secretary of State for Transport (Claire Perry)
It is a pleasure to serve under your chairmanship, Mrs Moon. I congratulate my hon. Friend the Member for South Dorset (Richard Drax) on securing this debate on the important issue of rail services between Weymouth to Waterloo. As he mentioned, we had a very fulfilling and useful working session earlier this afternoon, which was attended by some of our other hon. Friends in the Chamber. It is telling that so many right hon. and hon. Members are here today, including my hon. Friend the Member for Woking (Jonathan Lord), who represents an important constituency on this line. In all such debates, we hear a lot of joined-up support from MPs representing people living in towns, villages and cities right the way along the relevant routes, and I shall go on to address why that is so important.
Jonathan Lord (Woking) (Con)
I join my hon. Friend the Minister in congratulating our hon. Friend the Member for South Dorset (Richard Drax) on securing this debate and everything that he said, but will the Minister indulge me and reiterate that she supports the large improvements that will be required over the years to come at my station in Woking, which is on the line?
Claire Perry
Indeed; I would be happy to support that. I was going to come on to say that the Weymouth and Waterloo termini are at either end of the south west main line. That line has the third-rail system, which is rather old electrified technology, and we know that that is one reason why its trains run more slowly than on lines with overhead technology. My hon. Friend raises an important point. Ultimately, the aspiration is to bring all electrified track up to the state-of-the-art level, which would include the investments that he references.
As we heard, journey times on the line are anywhere from two hours 40 minutes to three hours. My hon. Friend the Member for South Dorset came to see me well before the general election to discuss the idea of upgrading the electrical supply along the line to provide a power boost. Some work has been done and, as he rightly said, it is difficult to see the cost-effectiveness—the business case—of those specific investments. As he is a person who does not give up easily, he therefore turned to option 2, which is the idea of connecting that line with the one running through Yeovil, thereby allowing a diversionary route that, of course, would benefit stations in Yeovil and Salisbury, which are represented by hon. Friends in the Chamber. That proposal is interesting, and we had an excellent session this afternoon to run through what would actually need to be done to deliver the journey time improvements that we want. We want to deliver the increased frequency and decreased journey times that would deliver the economic benefits about which we have heard a great deal.
As we know, this is a vital franchise area for the country. Waterloo is the busiest station in the UK. This franchise carries millions of people every year, which was why we announced this year that we would have a franchise competition with a view to getting a new operator in place for 2017. This is a fortuitous time to be discussing infrastructure, because the franchising opportunity gives us a chance to look at what we really want to achieve for the whole of the south-west network. There are proposals to introduce faster trains, and perhaps diesel or bimodal trains, which might be something that bidders come back with to deliver improvements to journey times overall.
There is also the question of how to get investment for infrastructure. My hon. Friend spoke about this, and I am always amazed by how expensive it is to do things on the railway. However, we are talking about a small set of projects—this is not something of the scale of the Great Western electrification. We have clearly signalled our desire not to route all railway investment through Network Rail, but to use the train operating companies as the commissioners, as well as the operators running on the network. We have an example of that, because FirstGroup is already taking the lead role in the Selby to Hull electrification project.
While we are going through the franchise process, there is an opportunity to engage with the bidders and determine their appetite is to deliver improvements. Of course, the question is: what is the cost to them? My hon. Friend is right that one cannot set out the business case without knowing the cost. In all honesty, I do not want to burden Network Rail with any more projects at the moment, given its enormous challenge of delivering the projects that we have already set out, but I will discuss with my officials a way of trying to get a better analysis of at least what the range of costs might be for these improvements. We can then start to build a case that takes account of those costs and examines the benefits that improvements to journey times and greater connectivity could deliver.
What was so refreshing in today’s meeting—I pay tribute to my hon. Friend, as well as others who attended—was that we had the local enterprise partnerships and local councils present, as well as MPs assiduously representing their constituents. All were thinking about how this network might look for the region, and that is the way to crack the investment conundrum. I have become aware that it is often surprisingly difficult to generate a business case for transport investment. The Jubilee Line extension, High Speed 1 and the M25 were all things whose benefits people in my position many years ago had to struggle to get recognised.
If we start to bring in the broader benefits, such as the housing that these transport improvements could underpin, the businesses that would move to the area and the local growth that could be unlocked, we could really start to capture the value that transport investment can bring. The right way to do that is to engage from the bottom up with the local enterprise partnerships and the council, which can then pull through investment for the benefit of their towns, cities and region.
I therefore urge my hon. Friends, working with their LEP and local council colleagues, to get this issue into the consultation for the franchise, which will run until 9 February. I know that my hon. Friend the Member for South Dorset is not going to come up with a wish list. Any proposal will be targeted, but we could look at that as something that could be put into the franchise competition for the bidders. Then, by the way, we would be starting to get some competition around the bidding process, which could only be to the good.
In the longer term, as I said, there is an aspiration to improve the electrification right along the line, but we need to be in the business of the delivery of infrastructure. For too long, many Governments have been in a “jam tomorrow” place. Now, we have a fully funded list of improvements and projects that Network Rail will deliver over the next four years, after which we can start to bring together the investment horizon for the future.
What is so refreshing about this debate and the amount of work that went into preparing all the documents that my hon. Friend brought to our meeting is that we are not only spending a record amount on the railways—it is the biggest investment programme since Victorian times—but spending it in the way that most benefits local communities. The investment is being not pushed out by the Department for Transport, but pulled out by those in the regions, because without good transport investment, it is not possible to grow a local, regional or national economy.
I commend hon. Members for attending the debate and speaking so passionately for their railways, and I commend my hon. Friend the Member for South Dorset for all his work. I undertake to consider whether we can come up with a way of getting the numerical range to which I referred so that we can at least start to have a more detailed conversation as the franchise period progresses.
Question put and agreed to.
Access to Justice: Wales
(8 years, 4 months ago)
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Carolyn Harris (Swansea East) (Lab)
I beg to move,
That this House has considered access to justice in Wales.
It is a pleasure to serve under your excellent chairmanship, Mrs Moon. Access to justice is not a special privilege, but a fundamental right. No one should be denied access to justice because of who they are, where they live or how much they earn. Everyone is equal before the law. The two-nation system is something on which the Secretary of State for Justice and I would possibly agree. When he was appointed, he said:
“There are two nations in our justice system at present. On the one hand, the wealthy, international class...And then everyone else, who has to put up with a creaking, outdated system to see justice done in their own lives.”
What he did not say was that his policies, and those of his Government, have created much of the injustice that we see today. Cuts to legal aid, tribunal fees and court charges have all put a price on justice, and ordinary people across Wales have suffered as a consequence.
The cuts to legal aid implemented by the Conservative and Lib Dem coalition have had a dramatic effect on access to justice in Wales. The number of cases granted funding has dropped by two thirds. Solicitors in my constituency say that cases have “decreased significantly”, and the number of debt cases supported by legal aid fell from 81,000 to just 2,500 over a one-year period. Every one of those cases involves real people, who are being denied the help that they need when they are at their most vulnerable. It is the most vulnerable people in Wales who are being hurt by the changes.
Jessica Morden (Newport East) (Lab)
Earlier this year, the Select Committee on Justice and the Public Accounts Committee criticised the Government’s civil legal aid changes, saying that they limited access to justice for some of those who need legal aid the most and that, in some cases, they resulted in cases becoming more difficult and therefore costing the taxpayer more. Does my hon. Friend agree that that very much echoes the cases that we see, week on week, in our constituencies?
Carolyn Harris
It certainly does. I agree with my hon. Friend, and I will come on to discuss that further. When we put a price on justice, those with the means to pay sky-high legal fees will be fine, but people who are in debt, women experiencing domestic violence and parents seeking custody of their children will not be. Ten law centres have already closed in England and Wales, and many more are unable to cope. We are talking not about legal aid lawyers supposedly raking in millions of pounds in fees, but about centres, staffed by volunteers, that can no longer offer fundamental support to those who need it most. Solicitors’ firms in my constituency have told me of the obstacles facing their clients:
“The evidential requirements are stringent. There are occasionally cost implications for clients in seeking evidence to support their application for public funding which is difficult for them if they are on benefits.”
They say that
“everything the Legal Aid Agency is doing is making it harder for both clients and lawyers to get legal aid.”
The cuts have removed legal aid from nearly all family law cases and led to a sharp increase in the number of litigants in person. In the first quarter of this year, 76% of private family cases involved at least one party who was not represented. The Personal Support Unit, which has an office at Cardiff Crown court and which offers advice to litigants in person, has seen the number of people accessing its services more than double from 20,000 in 2013-14 to an estimated 50,000 this year. The idea that someone who has had their children taken away from them and who may be fighting allegations of domestic abuse is able to defend himself or herself as well as a lawyer could is ridiculous, but that is the reality of the two-nation justice system.
Ian C. Lucas (Wrexham) (Lab)
I am grateful to my hon. Friend for raising the important subject of litigants in person. I have spoken to court staff and judges who are deeply concerned about the impossible position that they are placed in when they have to make a decision on cases involving, but at the same time end up giving advice to, litigants in person who are desperately unable to cope with the complexities of the legal system in which they have to operate.
Carolyn Harris
My hon. Friend refers to the reality that the two-nation justice system has created. Cuts to legal aid are having a significant impact on advice services for those experiencing housing, debt and welfare problems. A report commissioned by the Welsh Government shortly after the first changes were introduced found that cuts had “severely affected advice services” and resulted in
“specialist welfare benefits advice being significantly reduced by Legal Aid funding.”
The Welsh Government have done what they can to mitigate those cuts, investing an extra £1 million a year to support front-line advice services, in addition to the top-up of £2.2 million a year to Citizens Advice Cymru to help it to provide a specialist advice service for those who need it. The reality is that thousands of people in need of support will still lose out because of the Ministry of Justice cuts. In Wales, the number of free, face-to-face welfare law advice sessions provided by the not-for-profit sector is estimated to have fallen from nearly 20,000 to barely 3,000 in just one year.
Last month, in the Chancellor’s autumn statement, the Government snuck in an increase in the small claims court limit, which means that the majority of people injured in road accidents, regardless of how severely they were injured, will lose their access to legal representation. Whether for people injured in accidents, families facing debt proceedings or those of limited means who want legal advice before a court hearing, the Government’s changes have had a profound effect on access to justice in Wales.
Few people are more in need of support than women who are experiencing domestic abuse. I am talking about women who have suffered years and years of physical and sexual violence, who turn to the family court to seek help for themselves and their children. Women who may need legal aid to divorce an abusive partner, or even to apply for a child arrangements order to protect their child from an abuser, now have to convince the Government that they have been abused before they can get any help. Worse, the narrow set of criteria proposed by the Government means that many women are unable to prove that they have been abused.
Charities such as Women’s Aid expressed serious concerns about the evidence criteria before the law was changed. Women’s Aid now says that 54% of women who access services as survivors of domestic violence would not meet the evidence criteria initially proposed. The cuts were railroaded through, however, and in one year the same charities found that 43% of women who had experienced domestic violence did not have the prescribed forms of evidence required to access family law legal aid. The Government have let those women down and, more importantly, let their children down.
In the light of that, it came as no surprise when the Justice Committee concluded last year that the reforms had failed three of the Government’s four tests. The reforms have not discouraged unnecessary litigation or targeted help at those who need it the most. On the Government’s claim that the changes were necessary to cut costs, the Committee said that the Ministry of Justice
“has failed to prove that it has delivered better overall value for money for the taxpayer because it has no idea at all of the knock-on costs of the legal aid changes to the public purse”.
The changes have not delivered value for money. Instead, they have forced vulnerable people to represent themselves in court and taken vital support away from abuse survivors.
The Government are charging ahead with changes to criminal legal aid, and we will face the same problems. From next year, the number of contracts issued to solicitors’ firms for criminal legal aid will fall from 1,600 to just over 500. Solicitors’ firms in parts of Wales, especially in rural areas, have warned that there simply will not be enough firms left to do all the work.
Mr Mark Williams (Ceredigion) (LD)
I congratulate the hon. Lady on securing this important debate. She will be aware that in the area that the Ministry of Justice names Dyfed Powys 2, which consists of all of Ceredigion, Pembrokeshire and all of Powys—the Opposition Members present will be aware of the geography of the terrain—it is suggested that only four solicitors’ practices will offer the reduced legal aid. Does she agree that that is the worst kind of access to justice imaginable?
Carolyn Harris
I would go as far as to say that it is almost zero access to justice.
The tendering process has been shown to be a complete shambles—the implementation date has slipped from January to April of next year and possibly into 2017. The president of the Law Society of England and Wales has spoken of a
“serious risk of a knock-on effect on access to justice for clients.”
That warning comes just weeks after the Government were forced to drop their criminal courts charges, which led to some 50 magistrates resigning from the profession in protest. In the words of the Justice Committee, the changes were
“having effects which are inimical to the interests of justice”,
including the creation of “perverse incentives” for innocent defendants to plead guilty. I am glad that the Government have finally realised that the court charges were not fit for purpose, but it was not before countless people potentially changed their pleas because they could not afford to say that they were not guilty.
Mr David Hanson (Delyn) (Lab)
Before my hon. Friend leaves the point of criminal courts charges, I am a member of the Justice Committee and we have just agreed that it was right to change the system. However, of the £5 million that was levied, only around £300,000 has been raised, leaving a debt on a large number of people who should not have had that charge imposed on them in the first place. Through my hon. Friend, I ask the Minister to tell us what will happen to those who have been levied the charge and who have not yet paid.
Carolyn Harris
It is clear that, alongside access to justice, the Government’s reforms to the criminal courts system have risked another fundamental British principle—the right to a fair trial. One of the most basic attributes that we expect of any justice system is that it is fair. Those who have committed crimes must be punished quickly and effectively, but everyone has the right for their case to be heard and nobody should have to decide how to plead based on whether they can afford to pay the fees—not least because victims of crime deserve better.
Will the Minister agree to an urgent review into how legal aid costs are affecting access to justice in Wales? As court charges—one of the flagship policies—have now been dumped, what confidence does he have that the other changes are not having a similar perverse effect on justice and the right to a fair trial?
Members across the Chamber have serious concerns about the proposal of the Ministry of Justice to close 11 courts and tribunals in Wales. In large parts of the country, it is already hard enough for those attending trials to reach their nearest court in the allotted time, and the decision to close those courts will make that harder still.
The Law Society has found that many people will find it impossible to get to their nearest court within an hour when travelling by public transport. If the Government go ahead with their plan to close, for example, two courts in Carmarthen, just 32% of people taking public transport to my constituency of Swansea for family law cases would be able to get there within 60 minutes. For criminal cases, the figure is 31%. Across Wales, in areas where there is limited or infrequent public transport, it is a very real possibility that defendants and witnesses could end up on the same bus to the court hearing. Members can imagine the distress and legal complications that that will cause.
Wayne David (Caerphilly) (Lab)
Does my hon. Friend agree that it is quite ridiculous that, at the last Justice questions, the Minister suggested that people could access justice by telephone?
Carolyn Harris
I think I referred to it as sentencing by text, if I am not mistaken. It is an absolutely absurd idea.
Huw Irranca-Davies (Ogmore) (Lab)
The Minister did indeed say that mobile phones would be the way forward for my constituents. We are facing closures in Pontypridd and Bridgend, which are difficult enough to get to at the moment. To tell those constituents to come down the valley and change transport to get to Cardiff will add another impediment to access to justice. Through my hon. Friend, I would say that the Minister really needs to think this through again and to think about the geography of Wales. We are not flatlands with a huge transport hub; we are valleys. I know that your constituency is affected by the issue as well, Mrs Moon.
Carolyn Harris
I thank my hon. Friend for his intervention. The Law Society has expressed “grave concerns” that the proposal to close courts—I agree with this point—could “erode access to justice”. Its worries are shared by many people across the region.
Whether it is closing courts, slashing legal aid or any other reforms that I have not had an opportunity to address—such as employment tribunal fees, changes to judicial review or the plan to scrap the Human Rights Act—Government policies are having a severe impact on access to justice in Wales. It is the responsibility of any Government to ensure that our justice system does not become the preserve of the wealthy and unresponsive to the needs of those who need to use it most. It is vital that the justice system is accessible when we need it and accessible to all. I seriously fear that after another five years of this Government, neither of those opportunities will be open for Wales.
Several hon. Members rose—
Mrs Madeleine Moon (in the Chair)
Order. I have before me only two names of Members who have asked to speak. At 5.20 pm, I intend to call the Front-Bench spokesmen for the Labour party and the Scottish National party, who will have five minutes each, and then the Minister, who will have 10 minutes. I will first call Albert Owen, and if other Members wish to speak, they will have to rely on the generosity of the hon. Gentleman and the next Member to be called if they are to get in before 5.20 pm.
Albert Owen (Ynys Môn) (Lab)
It is a pleasure to serve under your chairmanship, I think for the first time, Mrs Moon. I congratulate my hon. Friend the Member for Swansea East (Carolyn Harris) on an excellent speech that covered most of the points that need to be considered.
I will actually start by agreeing with the Minister and the Ministry of Justice that access to justice for all is a fundamental aspect of our society. That is what it says in the consultation document on proposals for the provision of the court estate in England and Wales. I totally agree that we all want access to justice for all. Indeed, I would say that local justice and democracy are the pillars of a modern society, but we are moving away from that—I shall develop that argument a little later.
I welcome the Minister to the Chamber, because he was kind enough to acknowledge my submission to the consultation and to meet a delegation that included Citizens Advice and a local solicitor. We were able to outline many of my concerns for my area and, indeed, the periphery area of north-west Wales, including Dwyfor Meirionnydd, because the representative from the solicitor represented the whole old county of Gwynedd. However, it is Christmas, and I am going to subject the Minister to my concerns once more because it is important that they are on the record.
People know the importance of direct access to justice. The Ministry of Justice wants to close the two remaining courts in my area in Llangefni and Holyhead. Llangefni is the principal and municipal town of Anglesey. Holyhead is the largest town on the island, but also the furthest from Cardiff and London—it is on the periphery area. It is the hub to the Republic of Ireland and has a large transit population, as well as local residents. The proposal to transfer to Caernarfon court is therefore fundamentally flawed. What is more, the alternative that the Minister has talked about—the virtual courts and the digital fines—are equally flawed. Frankly, the one-size-fits-all proposal of the Ministry of Justice does not fit Wales; each part of Wales should be looked at on its merits. I understand, as I think does every Member in the Chamber, the need to modernise the justice system, but denying access is not modernisation. It is a backwards step and the proposal does not take into account people’s distances from court.
The Government talk about courts being 30 miles away and taking about an hour to reach. The journey from Holyhead to Caernarfon is 30 miles, but it can take an hour and a half. It can involve train journeys, two buses and changing. As has been said, many of those who have to travel will be witnesses, not just those who are up in court.
I believe that the proposal is flawed because it is driven by the Treasury. One of the main reasons why the exercise is being carried out now and in such a way is to save money on the estate. Yes, we need to get value for money, but the process is driven by the Treasury, rather than the Ministry of Justice. It is important to put that point on the record and I will be interested to hear the Minister’s response to it.
Access to local justice has to be practical, and people have to be able to have such access. The Minister talks about virtual courts, but they will be virtually impossible to implement. There are very few buildings in my constituency that could accommodate a virtual court. He talks about access via the digital age, but the digital age has not arrived in many rural or peripheral parts of Wales. That is an important point because the superfast broadband roll-out is happening at the exchanges, but not going to many towns and areas that need it. It would be difficult to have a virtual court in north-west Wales, for example, because the information and communications technology systems simply are not there—they are intermittent. I am pleased that the Government have done a U-turn with regard to universal coverage, but that will not come in until 2020, at the earliest, and these proposals are going through now. When will the Minister respond to the consultation exercise and make his recommendations and proposals? I believe that he should wait until we have proper infrastructure if he wants to experiment with the digital age for accessing justice.
I am conscious that other Members wish to speak, so I will not go over most of the issues that I discussed with the Minister. However, I highlight the fact that in the 21st century we still need a court system that individuals can access. The public want individuals to be tried in their area, as has happened historically. If we are to move forward into the digital age, we need the necessary infrastructure in place, and the Ministry of Justice needs joined-up thinking with other Departments.
Wayne David
Does my hon. Friend agree that it is particularly important that digitalisation is done properly in Wales because we are a bilingual country and people must have access to justice in the language of their birth? If that language is Welsh, they must have access in Welsh.
Albert Owen
My hon. Friend is absolutely right. I was going to make that point in my closing remarks, because when we talk about “local”, we are talking about local culture and local languages as well as the basic principle of access to local courts.
The Government talk about putting in place devolution and decentralisation, yet their record is one of the complete opposite. They are centralising tax offices, for example. If the Government’s proposals go through, the nearest tax office to Anglesey will be in Liverpool, which is nearer to my constituents than Cardiff. We are now talking about courts moving 30 or 40 miles away from their population, which is nothing but centralisation. I urge the Minister to look again at these proposals, to put them on hold, to talk to local communities and to listen to the consultation. He should not rush through the proposals because while I agree with him, ultimately, that we need free and fair access for all, that will not happen if these proposals go through.
Mr Mark Williams (Ceredigion) (LD)
It is a pleasure to serve under your chairmanship for the first time, Mrs Moon, and I will be brief. I congratulate the hon. Member for Swansea East (Carolyn Harris) on raising this issue. She talks about the emergence of a two-tier system, and there will be a very strong divide between rural and urban communities.
Mercifully, there is one courthouse left in my constituency, in Aberystwyth. That is the only one, as our courthouse in Cardigan was shut down five years ago. I reiterate what the hon. Lady said about the challenges of geography and distance. In the debate that I secured when we tried to stop the closure of Cardigan courthouse, we heard that as Cardigan was only 38 miles from Aberystwyth, all would be well, because there would be ease of access to our court in Aberystwyth, but that is not so. It might be quick and easy to travel 38 miles down the A55 or the M4—or perhaps not—but the situation is a different kettle of fish for people living in rural communities. As she said, the problem is compounded by my constituents’ experience of trying to access public transport in rural areas where no such system exists.
Access to our courts is a very real issue. If I were being parochial, I might say that my underused courthouse in Aberystwyth will gain more work when the courthouse in Dolgellau is shut, but I do not say that because, from experience, I believe that the situation goes to the heart of access to justice for many of our constituents.
Let me talk specifically about the point about which I intervened on the hon. Lady. She alluded to the limitations of legal aid, and I want to talk about the number of practitioners out there in the country. When the right hon. Member for Epsom and Ewell (Chris Grayling), who is now Leader of the House, was Secretary of State for Justice, he proposed a two-tier system for delivering criminal legal aid. That proposal has continued under the current Secretary of State. The scheme involves a bidding process for the limited number of contracts within each bid zone, and I repeat what I said in my intervention. My vast constituency of Ceredigion falls into the Dyfed Powys 2 zone, which includes Ceredigion, Pembrokeshire and the whole of Powys, including the towns of Brecon, Llandrindod Wells, Newtown, Welshpool, Machynlleth, Aberystwyth and Cardigan. Incredibly, the Ministry of Justice decided that only four contracts would be made available in that vast area, which is dangerous nonsense.
When I talked to solicitors’ practices about the prospect of bidding, the reality soon emerged that no single firm in Dyfed-Powys would be able to service such a contract because the volume of legal aid work in mid and west Wales is so low that it could not sustain a business undertaking such an endeavour. The characteristic of our model for delivering criminal legal aid in Ceredigion, which is not dissimilar to that in other places in rural Wales, is of one or two solicitors within a high street mixed practice effectively subsidising legal aid work. When the Government made their proposal, the fact that there was no plan B suggested that it was doomed to fail. As of July 2015, there are only five firms undertaking legal aid work in Ceredigion, which suggests that many firms have already decided that such work is not profitable. None of the firms in my constituency felt able to bid for the duty contracts, either on their own or collaboratively. The Government suggested at the time of the announcement that small practices would come together, but that was not going to happen. Such an arrangement is fraught with difficulties.
We are where we are, but I am not quite sure where that is. The hon. Member for Swansea East said that we were led to believe that the bidding process would be concluded in January 2016, but it is now suggested that it will be concluded in April. There are contingency contracts around, which suggests that the situation might not be resolved until 2017. That is causing great concern among solicitors’ practices and a lot of uncertainty. When can we expect a resolution? The spectacle of there being only three or four providers across mid and west Wales makes one shudder, which is why a renewed number of legal aid concerns have been raised in all our surgeries. It is also why there is huge pressure on the very limited citizens advice bureaux across our constituencies, to which I pay tribute.
The other thing that needs to be mentioned is the Welsh language, which is spoken by more than half my constituency’s population. I am concerned about whether the providers, especially if they come from outside my area, or outside the broad expanse of mid and west Wales, will still be able to present their services through the medium of Welsh. That remains a great worry, whatever the Legal Aid Agency suggests, because when these services were being delivered by small solicitors’ practices in high streets throughout the country, we had a guarantee. As those practices were based in Welsh-speaking communities, their services could be provided in the mother tongue, whatever that mother tongue may be. Again, I sadly reflect that the situation illustrates how the Ministry of Justice has scant knowledge of and regard for rurality and, I believe, scant regard for the Welsh language, too.
Several hon. Members rose—
Mrs Madeleine Moon (in the Chair)
Order. I have received a number of notes from Members advising me that they notified the Speaker’s Office of their wish to speak. I have not been advised that those requests were received by the Speaker’s Office, but in an attempt to get in everyone who has approached me, I shall set a three-minute time limit on speeches.
Nick Thomas-Symonds (Torfaen) (Lab)
It is a pleasure to serve under your chairmanship, Mrs Moon, and I congratulate my hon. Friend the Member for Swansea East (Carolyn Harris) on securing this important debate on such a crucial issue at such a crucial time. Access to justice in Wales is under threat. In employment tribunals, for example, there were 16,456 single-claim cases in 2014-15, which represented a 52% fall on the number in 2013-14. That fall was due to the introduction of the fees system that has levied up to £1,200 on people who have lost their jobs and are not in a position to spend that amount of cash.
I practised in the Welsh courts as a barrister for 11 years before entering this place, and while I remain a door tenant at Civitas in Cardiff, I no longer practise. I am fully aware of what has been going on, especially in relation to employment matters. The changes mean that literally thousands of people are no longer able to enforce their legal rights before an employment tribunal.
There are 11 scheduled court closures. My hon. Friend the Member for Caerphilly (Wayne David) pointed out that the Minister has talked about telephone hearings already happening in court, but let me make the distinction clear. Interlocutory hearings, especially those in the civil courts that last for less than an hour, have for some years been done on the telephone—that is absolutely true. It is also true that in certain trials and certain specific circumstances, witnesses have given evidence by video link. However, extreme care has always been taken with trials, when it is best that the veracity of witnesses is judged face to face. Their demeanour has to be judged; it is not simply a case of what they happen to say through a particular visual medium. It is crucial to realise that there has to be a limit to what is done through the so-called digital revolution in the court system. Certain trials simply cannot be done on the telephone or via such a visual medium, so the Ministry of Justice must take that into account.
Local justice is crucial, because it is important that we do not see justice as distant. Justice should reflect the culture of the area, and I fear that the closure of 11 courts will put that at risk.
I urge the Ministry of Justice to be wary of false economies on civil legal aid. It is one thing to take down the legal aid bill, but it is quite another if one ends up with far more litigants in person in the court system. There is nothing wrong with people representing themselves, but they should not do so simply because they cannot afford to access a lawyer. If that does happen, I am afraid that the court system will be slowed by having so many litigants in person, and the Minister will find that the cuts in civil legal aid are simply counter-productive.
Jonathan Edwards (Carmarthen East and Dinefwr) (PC)
One of my first contributions after being elected to the House of Commons in 2010 was to fight in this Chamber on behalf of the two magistrates courts that remained in my constituency: Ammanford and Llandovery. The Government proposed closing those courts on the basis that services would be provided in Carmarthen magistrates court, yet here we are debating the future of that court and the state-of-the-art family, tribunal and probate hearing centre that was opened in Carmarthen by the Lord Chief Justice in 2012. That goes to show, to use a famous Welsh political phrase, that centralisation is a process, not an event. I wonder how long it will be, with services being centralised in Llanelli, before we are arguing about the centralisation of services to Swansea, which is only a dozen miles to the east. It is easy for Ministers and their civil servants to sit here in London and draw lines on a map and crosses through budget lines without understanding the full effect of the changes on the communities we represent.
I oppose the proposals for the west of my country for five primary reasons. First, Carmarthen is the legal capital of the west of my country. It was afforded that status by James I in 1604, when he made it a county corporate by charter. I am struggling to understand why the Minister thinks he knows better than James I. Carmarthen is one of only two towns in Wales that still has a town sheriff, and that gives a clear indication of the importance of the role that Carmarthen has played in the legal system in the west of Wales.
Secondly, the Ministry of Justice has spent £1.7 million on the two courts in Carmarthen in the past seven years, so it would be a colossal waste of money to close those courts following such investment. When the family court was opened in 2012 by the Lord Chief Justice, it was seen as a pathfinder for the future of legal services in Wales and England because of all its video-conferencing technology. The Minister says that such technology is the way forward, but I am informed by magistrates that none of that equipment has actually been installed. I therefore find it difficult to understand how the Minister can make the case for closing that court in Carmarthen—it has just been opened—on the basis of a lack of operational capacity. He will argue that the way forward is remote justice but, as the hon. Member for Ynys Môn (Albert Owen) said, we are talking about areas that are known to have broadband “not spots” and to lack fast mobile provision. It will be difficult to deliver such a legal system in the areas we represent.
Thirdly, Carmarthen is the natural travel hub for the west, north and east of Carmarthenshire. It could take five hours by public transport for someone from Newcastle Emlyn or Llandovery to make it to Llanelli to attend court. The natural transport hub for Carmarthenshire is the county town, so it does not make any sense to close the courts in Carmarthen. Fourthly, as has been mentioned—
Mrs Madeleine Moon (in the Chair)
Order. To get all hon. Members in, we will need to move on. I call Liz Saville Roberts.
Liz Saville Roberts (Dwyfor Meirionnydd) (PC)
Diolch yn fawr, Gadeirydd. I congratulate the hon. Member for Swansea East (Carolyn Harris) on securing the debate. It is an important topic, and it is particularly important to my rural constituency of Dwyfor Meirionnydd. Fifteen courts were closed across Wales during the last Parliament, and since the 2015 election, a further 14 have either closed or are being earmarked for closure by the UK Government. The proposed closure of Dolgellau magistrates court in my constituency, for example, means cases will need to be transferred to either Caernarfon or Aberystwyth, which, incidentally, is outside the North Wales police region. The issue of inadequate public transport in Wales is well documented, but Members will understand that a journey from Dolgellau to Aberystwyth or Carmarthen is not simply a matter of getting on a tube with an Oyster card. For my constituents in Dwyfor Meirionnydd, and indeed for many people across Wales, it is simply impossible for public transport to get them to a magistrates court for a 9.30 am start.
The Ministry of Justice claims its programme of cuts is necessary to save money, but what will effectively happen is that the cost of providing justice will be passed from the state to the citizen. The cost will still be borne, but by the individual regardless of ability to pay, while the state washes its hands.
I have left out a number of things due to time pressures, which is unfortunate, but I return to the issue of courts. I have a background in teaching through video conferencing, so I welcome the Minister’s commitment last month to undertake a Welsh language impact assessment before coming to conclusions about the future of courts in Wales. On the other hand, I am also interested in efforts to increase access to justice through the use of technology, particularly video technology.
Given the swathes of court closures and the particular problems they will cause in rural parts of Wales, allowing hearings to take place remotely may be welcome. I note however the eight conditions set out by Lord Leveson’s review of efficiency in criminal proceedings in January 2015. He considered those conditions to be prerequisites for remote hearings. The first of them seems obvious, but is in fact crucial: the equipment used and the audio and visual quality should be of a high standard. Given what fellow Members have said, I wonder what consideration has been given to the quality and reliability of digital infrastructure in those areas where courts are to be closed. I particularly urge that consideration is given to Lord Leveson’s recommendation that a committee of criminal justice professionals be charged with identifying best practice for hearings conducted via video link, not only to maintain the gravitas of the court environment, but, more importantly, to ensure that justice outcomes via communications technology are consistent with justice outcomes in a conventional environment.
I also urge the Minister to consider alternative public buildings if a court building—this is understandable—is no longer deemed suitable for 21st-century justice. In the case of Dolgellau, the Meirionnydd council chamber would require little adaptation, and offers such facilities as parking and translation equipment. As an aside, it is also nearer the cells and the police station than the present court—
Mrs Madeleine Moon (in the Chair)
Order. We need to move on. I call Richard Arkless.
Richard Arkless (Dumfries and Galloway) (SNP)
It is a privilege to serve under your chairpersonship this afternoon, Mrs Moon. I thank the hon. Member for Swansea East (Carolyn Harris) for securing a very important debate. It has been amplified by the number of Welsh Members who have attended this afternoon to put their point across very passionately. It is further amplified by the lack of the 11 Tory MPs who occupy certain sections of Wales. The only thing more surprising is that Wales still has 11 Tory MPs; I hope the people of Wales will deal with that at the next general election.
Scotland is fortunate; we have had a separate legal system since the Act of Union. It was enshrined in the Act, so during the last 300-odd years we have been able to design certain elements of our justice system differently to suit the needs of the people of Scotland. Many of the complaints raised this afternoon would be fixed to a great extent by devolution of justice to Wales. I urge Welsh Members to think about that as a serious concept. Justice decisions made closer to the people that they affect would inevitably be better decisions.
The Government have created several bars to access to justice over the past few years. We have seen criminal court charges, which, thankfully, they have agreed to end. We do not have them in Scotland. Employment tribunal fees have been imposed on employment tribunal cases, as we have heard. We have committed to abolish those in Scotland as soon as the matter is devolved. The slashing of the legal aid budget has impacted on access to justice. We are not immune from such cuts in Scotland, but we feel we have been able to manage resources better so that they do not have the impact that they have had in Wales.
I have been very impressed by some of the submissions that we have heard, particularly from the hon. Member for Swansea East. She gave a passionate speech about the real effects on ordinary people. That is always the story with austerity, which impacts on the most vulnerable in our society first. The Government’s austerity agenda impacts on access to justice in Wales. That is undeniable.
The hon. Member for Ynys Môn (Albert Owen) made another fantastically passionate speech and coined the phrase “one size fits all”. It goes back to the whole devolution prospect. I do not believe as a matter of principle that a one-size-fits-all approach across the UK is sensible for all the Celtic nations. He is absolutely correct when he says that access to justice is driven by the Treasury. The Ministry of Justice has not come up with a grand plan to increase justice provision, yet reduce costs. The Justice Secretary has rolled over in negotiations with the Treasury, whereas other Departments have not done so.
Given the pressure on time, I will conclude my remarks. I support the proposal that Wales should have more decisions taken by the Welsh Parliament, closer to the Welsh people, to make better decisions for the people of Wales.
Susan Elan Jones (Clwyd South) (Lab)
It is a great pleasure to serve under your chairmanship, Mrs Moon. I am conscious of something that George Bernard Shaw once said. He apologised for writing a long note because he had not had time to write a short note. I fear I have written rather a long note, but I know you will keep me to delivering a short speech.
I congratulate my hon. Friend the Member for Swansea East (Carolyn Harris) on securing today’s debate and on such a wide-ranging, passionate and practical speech that highlighted some of the real problems with access to justice in Wales. I really hope the Minister will take these matters on board and make some changes. The debate has been phenomenal. We have had contributions from 10 Back Benchers and a visitor from Scotland, the hon. Member for Dumfries and Galloway (Richard Arkless). We have had contributions from my hon. Friends the Members for Caerphilly (Wayne David) and for Newport East (Jessica Morden), and from my right hon. Friend the Member for Delyn (Mr Hanson), who made a very important point about the Justice Committee and we look forward to a response from the Minister on that.
My hon. Friend the Member for Wrexham (Ian C. Lucas) talked about the issue of litigants in person. We heard from my hon. Friends the Members for Ogmore (Huw Irranca-Davies), and for Ynys Môn (Albert Owen). The latter referred to many issues relating to his constituency, but he also referred to an issue that really needs highlighting: the prospect of the accused and the defendant travelling on the same bus. Imagine a victim of domestic violence and the perpetrator on the same rural bus. That is a really important point that shows many of the flaws in the current proposals.
We heard a speech from the hon. Member for Ceredigion (Mr Williams) on rural communities, especially in mid and west Wales. My hon. Friend the Member for Torfaen (Nick Thomas-Symonds) showed his extensive practical experience of legal representation and some of the flaws in the current proposals. The hon. Member for Carmarthen East and Dinefwr (Jonathan Edwards) rightly complained about centralisation, and the hon. Member for Dwyfor Meirionnydd (Liz Saville Roberts) raised, among other issues, remote hearings. Labour Members often talk about the importance of being tough on crime and tough on the causes of crime, but for this Government and their proposals it is tough if you happen to be a victim of crime, which is very different indeed. It is extraordinary that no Conservative Members are here. They had an increase in numbers at the general election and they are still not here representing the interests of the people of Wales.
There are many problems, but I want to focus on two issues. The first relates to the impact on the Welsh language, which several Members mentioned. Few of us ever have to testify in court, and even fewer will testify against an attacker or an abuser, but, for the people who do, being able to communicate effectively and to hear and understand everything that is said is essential. For many first-language Welsh speakers, that means being able to engage with the court in Welsh. That right goes back nearly 70 years to the Welsh Courts Act 1942, which overturned the ban on Welsh in courts that had been in place since the 16th century.
Everyone can surely speak English, but I refer Members to the words of the Labour peer, Viscount Sankey, during the passage of the Welsh Courts Act:
“No doubt many members of this House read French easily and speak it well; many speak it perfectly; yet how should we like to be examined and cross-examined in French? Should we not be rather nervous and embarrassed witnesses and fail to do ourselves justice?”—[Official Report, House of Lords, 20 October 1942; Vol. 124, c. 662-8.]
I am not sure Members are quite as proficient in French as they probably were in the 1940s, but the point remains that being able to communicate in one’s own language before a court is essential. It is not a nicety. The Ministry of Justice’s own Welsh language scheme admits that the Department has failed to evaluate the linguistic consequences of its policies. Securing the rights of Welsh speakers and promoting the equality of Welsh and English are not optional niceties; they are statutory requirements, and the disregard is positively shameful.
The Welsh Language Commissioner has criticised the way in which the closures have been proposed. As she points out, a
“decision to change the court estate, should aim to promote and facilitate the use of Welsh in Wales.”
We want an answer.
Let us look at the case of Anglesey, or Ynys Môn, as my hon. Friend the Member for Ynys Môn calls it. Some 70% of people on the island have knowledge of Welsh, with 56% describing themselves as Welsh speakers. If I am allowed, I will refer to the Human Rights Act—
Susan Elan Jones
But I am sure the Minister will speak of the grave omissions in his Government’s policy.
The Parliamentary Under-Secretary of State for Justice (Mr Shailesh Vara)
It is a pleasure to serve under your chairmanship this afternoon, Mrs Moon. I commend you on having managed to get through so many speakers in such a short time. I congratulate the hon. Member for Swansea East (Carolyn Harris) on securing this important debate. I also thank the many colleagues who have turned out for this debate; that demonstrates its importance. Individuals have spoken with passion, both on constituency matters and more generally. Several points have been raised, and I intend to address as many as I can. I ask Members to be patient if I do not instantly respond to their issue in the first minute or two. I will make one thing absolutely clear at the outset: the Government share the hon. Lady’s passion for a justice system that works for everyone.
The hon. Lady referred to my right hon. Friend the Lord Chancellor’s eloquent comment that the Government’s commitment to one nation justice was fundamental to the rule of law. At the heart of one nation justice is equality, and a justice system that safeguards and protects the vulnerable and works better for victims and witnesses. Our justice system does not always do that, despite the fantastic efforts of those who work in it. That is why the Ministry of Justice is leading a major reform programme. As the hon. Member for Swansea East will know, the MOJ has secured more than £700 million in funding to invest in courts and tribunals in England and Wales. We are working closely with the senior judiciary to deliver a justice system for everyone, at a lower cost for all those who need to access the courts.
There is much agreement that our courts and tribunals need urgent reform, and a high degree of consensus that the current system is not only too slow, but unsustainable. Despite the best efforts of front-line staff, the infrastructure supporting the administration of the service is inefficient and disjointed, and based on technology that is, in some cases, decades old. I hope Members agree that that has to change. That means using up-to-date technology, which I will discuss later in my speech, and modernised working practices, and having a more appropriate and efficient estate. It will also mean victims and witnesses being able to attend some hearings remotely, and not having to experience the stress and strain of a personal visit to a court, or, indeed, having to take a day off work.
Mention has been made of victims and witnesses travelling together. Clearly, that is a situation that none of us would want. The beauty of a remote system is that there is no danger of meeting people on the bus to court. The victims will not be travelling with the witnesses and the defendants. They may well be in a local civic building of some kind, in a video-conferencing suite to which people go by appointment at a specific time. They will be far more comfortable there, and will not have the stress and strain of going to court, which would be a strenuous and stressful experience for most people.
We are replacing paper forms, automating much of the administrative process, and allowing defendants to indicate their plea online. The use of telephones was mentioned. Let me make it clear that we are piloting a scheme in Manchester in which pleas can be made online, using either computers or smartphones. That is happening right now, as we speak.
Mr Vara
If the hon. Gentleman will forgive me, I will not, but I will address his point. He rightly said earlier that there will be some cases where digitalisation is clearly not appropriate; that is why we will maintain courts. Nevertheless, for many cases, court will not be necessary. The majesty of the court will remain for appropriate cases that deserve to go to court, but it is important to remember that access to justice does not always mean access to a court, with all the time and expense that that entails. Nor does it mean that people should always turn to taxpayer-funded lawyers. Where suitable alternatives are available, we want to see more cases diverted from the courts.
There is no doubt that in many cases court should be the last resort, not the first. Encouraging greater use of mediation has been a key part of our wider reforms to the justice system. Mediation can be quicker, cheaper and certainly less stressful than protracted litigation. For the taxpayer, who would otherwise be paying solicitors, barristers and for time in court, there will be a saving. For the parties involved, it is far better to sit around a table and have constructive engagement than to be in a court scenario, where there is often—I speak as a former solicitor—a destructive environment, rather than one of constructive engagement.
Susan Elan Jones
There might be some validity in that, but how does the Minister square it with the rise of litigants in person? We may well see the well-heeled being able to get the best legal advice in the world, while those on the other side of the dock have to represent themselves in person. Surely that is not fair.
Mr Vara
I plead with the hon. Lady to be patient; I will turn to litigants in person shortly.
From April last year, the Children and Families Act 2014 made it a legal requirement that anyone considering applying to court for an order about their children or finances should first attend a mediation information and assessment meeting, which we call a MIAM, unless exemptions such as domestic abuse apply. The requirement was introduced so that parties could consider the benefits of mediation before the start of court proceedings, which can be long, arduous and expensive. From November last year, we have funded the first single session of mediation in cases where one of the parties is already legally aided. In such circumstances, both parties will be funded for the MIAM and the first session of mediation.
I hope Members appreciate that legal aid is only one part of a balanced access-to-justice provision, although of course we recognise that in some cases it can be a vital part. We also recognise that those in greatest hardship at times of real need should have the resources to secure access to justice. When the programme to reform legal aid commenced in 2010, the scale of the financial challenge facing the Government was unprecedented. We had to find significant savings, which meant making difficult choices. Despite that, we have made sure that legal aid remains available when it is most needed: where people’s life or liberty is at stake; where they face the loss of their home; in cases of domestic violence; or where their children may be taken into care.
In the case of domestic violence, evidence is required to ensure that the correct cases attract funding, but we have listened and made changes to the amount of evidence required. One of the first things I did when I was appointed Minister in October 2013 was meet certain stakeholders, who told me that the conditions were too stringent. As a consequence, I made the appropriate changes. We will, of course, continue to listen and to make changes where necessary.
The fact remains that even after all the reforms, our legal aid system remains one of the most generous in the world. Last year we spent more than £1.6 billion on legal aid, which is around a quarter of the Department’s expenditure. We have also made sure that funding is available through the exceptional funding scheme, where that is required under the European convention on human rights or by European law. We believe that the reforms to the legal aid scheme are sustainable, but we have provided that there will be a review within three to five years of the implementation of part 1 of the Legal Aid, Sentencing and Punishment of Offenders Act 2012.
As far as the Welsh language is concerned, let me make it absolutely clear that Welsh-speaking users can call the Civil Legal Advice Welsh-language operator service, or request an immediate call back from a Welsh-speaking operator. The bilingual site architecture has been designed to ensure that the same service is available in the Welsh language as in English, and that the content can be easily kept up to date. We continue to work with the advice sector to develop sustainable and collaborative ways of working to ensure that people can obtain advice when they need it.
On litigants in person, we have provided £2 million for a strategy led by the advice, voluntary and pro bono sector. It maximises the provision of support to litigants in person, and there is an increase in the provision of face-to-face, phone and online support.
In the few moments I have left, let me address a few of the points raised. The hon. Member for Swansea East said that there has been a reduction in the number of criminal contracts, but there is a far higher number of contracts for own-client work, which means that people can continue to work for the clients that they already have. The right hon. Member for Delyn (Mr Hanson), who has a distinguished record in government, asked about the criminal court charge. He will know from his time in government that laws change. Until 24 December—the date that the Lord Chancellor gave—the law will apply. I have already touched on the issue of telephone access, but I emphasise that the digitalisation process that we envisage will clearly not apply to all cases. The physical presence of courts, which people will need to go to when appropriate, will always remain.
I congratulate the hon. Member for Swansea East on securing this debate, and I thank all Members for taking the trouble to attend. I hope I have been able to give some comfort to Members, and assure them that we are very keen to ensure that access to justice remains.
Question put and agreed to.
Resolved,
That this House has considered access to justice in Wales.
Written Statements
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Financial Services
(8 years, 4 months ago)
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The Economic Secretary to the Treasury (Harriett Baldwin)
The Government have today published their response to the consultation on creating a secondary annuity market (CM 9046, March 2015). The response confirms that from 6 April 2017 tax restrictions for people looking to sell their annuity will be removed, giving the 5 million people with an existing annuity, and anyone who purchases an annuity in the future, the freedom to sell their right to future income streams for an upfront cash sum. This will extend the pension freedoms already introduced in April 2015 for those reaching retirement with a pension pot. The consultation sets out further details around how the market will work, including the comprehensive consumer protection regime.
The document has been placed in the Libraries of both Houses.
[HCWS396]
Environment Council: Agenda
(8 years, 4 months ago)
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The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Rory Stewart)
I will attend the EU Environment Council in Brussels on 16 December.
Following adoption of the agenda, the list of “A” items will be approved.
There will next be legislative deliberations on the proposal for a directive on the reduction of national emissions of certain atmospheric pollutants (the “National Emissions Ceiling Directive”).
Under non-legislative activities, draft Council conclusions on the mid-term review of the EU biodiversity strategy to 2020 are due to be adopted.
Over lunch Ministers will be invited to discuss the latest proposals on air quality and real driving emissions.
The following items are due to be discussed under Any Other Business:
Registration, Evaluation, Authorisation and Restriction of Chemicals (REACH): challenges and options for improving legislation on chemical products;
Sustainable methods of producing and consuming medicine and managing the resulting waste;
19th ordinary meeting of the Contracting Parties (COP19) to the convention for the protection of the marine environment and the coastal region of the Mediterranean and its protocols (Barcelona convention, Athens, 9-12 February 2016);
Reducing pollution caused by consumption on the move: the case for a European deposit scheme;
Package of proposals aiming to promote the circular economy;
Report on the state of the energy union;
21st session of the Conference of the Parties (COP21) to the United Nations framework convention on climate change (UNFCCC) and 11th session of the Meeting of the Parties (CMP11) to the Kyoto protocol (Paris, 30 November to 11 December 2015);
Work programme of the incoming presidency.
[HCWS393]
Law and Order Trust Fund Afghanistan
(8 years, 4 months ago)
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The Parliamentary Under-Secretary of State for Foreign and Commonwealth Affairs (Mr Tobias Ellwood)
On 4 December 2015 the Foreign and Commonwealth Office fulfilled the promise given by the Prime Minister at the NATO Chicago summit in 2012 to contribute £70 million in 2015 towards the sustainment of the Afghan National Defence and Security Forces (ANDSF). This forms part of our commitment, together with international partners, to provide financial support to meet the cost of the ANDSF for each of the calendar years 2015-17.
The UK’s 2015 contribution, funded from the conflict, stability and security fund (CSSF), has been channelled through the United Nations Development Programme run Law and Order Trust Fund Afghanistan (LOTFA) to support the payment of Afghan National Police (ANP) salaries.
The development of an effective, accountable and civilianised ANP and the development of stable, transparent and effective Afghan security ministries are essential to long term stability and security in Afghanistan. The police play a fundamental role in providing security and governance in Afghanistan, as well as in helping to build trust in the legitimacy of the state. Due to the challenging security environment international support for Afghan policing continues to be required.
The UK will continue to support the development of capable and effective civilian security institutions.
[HCWS397]
OSCE Ministerial Council
(8 years, 4 months ago)
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The Minister for Europe (Mr David Lidington)
I represented the United Kingdom at the 22nd Ministerial Council meeting of the Organisation for Security and Co-operation in Europe (OSCE), held in Belgrade, Serbia on 3 and 4 December 2015 and hosted by Serbian Foreign Minister and OSCE Chairman-in-Office Ivica Dacic. The Council is the top decision-making body of the OSCE and was attended by Ministers from across its 57 participating states.
The Council took place in the final month of a year when the OSCE has continued to be at the centre of the international response to the Ukraine crisis. In my intervention in plenary on 3 December, I expressed deep concern at the ongoing situation in eastern Ukraine and Crimea and repeated our strong support for Ukrainian sovereignty and territorial integrity. I underlined the Russian Federation’s responsibility for the present situation and stressed that Moscow’s illegal annexation of Crimea would not be recognised. I called on Russia to implement its commitments under the Minsk protocols, by withdrawing military personnel, equipment and weapons and using its influence with the separatist leadership. I commended the work of the OSCE’s special monitoring mission in the face of considerable challenges to its security and emphasised the need for it to have free and unimpeded access to all areas of Ukraine.
While this subject dominated the Council, a number of other important issues were discussed. In my intervention, I also noted the importance of updating political-military confidence and security building measures, including the Vienna document and the need to protect human rights and fundamental freedoms, which remain under challenge in a number of OSCE states.
I agreed the need to address other pressing issues, particularly terrorism and migration, while focusing on areas where the OSCE has a distinct role to play and can add value in co-ordination with other international actors.
Grave concern about Ukraine was expressed in plenary by many participating states including by US Secretary of State Kerry, German Foreign Minister Steinmeier, Ukrainian Foreign Minister Klimkin and EU High Representative Mogherini among others. Deep divisions meant that even a limited declaration on the OSCE’s role in, and support to, Ukraine could not be agreed despite the vast majority of OSCE states’ desire to do so.
While negotiations before and during the Ministerial Council made progress in a number of areas, divergent approaches limited the scope to reach consensus on a number of proposed declarations. Decisions or declarations were however reached on terrorism, on countering violent extremism and radicalisation leading to terrorism, on drugs and youth and security, as well as a statement on the negotiations in the Transnistrian settlement process. It was disappointing that despite the best efforts of the UK and other states, attempts to make progress on confidence and security-building measures in the OSCE region failed primarily due to further Russian obstructionism.
I and others expressed our strong support for the work of the OSCE’s autonomous institutions and I met Michael Link, Director of the Office for Democratic Institutions and Human Rights (ODIHR) and Dunja Mijatovic, the Representative on Freedom of the Media, during my visit.
In parallel, Wolfgang Ischinger, Chair of the Panel of Eminent Persons, launched under the 2014 Swiss Chairmanship, presented their final report on “European Security as a Common Project” at a side-event during the Ministerial Council.
A copy of the UK intervention can be found online on the gov.uk website:
https://www.gov.uk/government/world-location-news/uk-statement-at-the-plenary-session-of-the-22nd-osce-ministerial-council-3rd-december-2015-belgrade.
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Overseas Territories Joint Ministerial Council
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The Parliamentary Under-Secretary of State for Foreign and Commonwealth Affairs (James Duddridge)
I chaired the fourth meeting of the Overseas Territories Joint Ministerial Council in London on 1 and 2 December. The Council was attended by elected leaders and representatives—Anguilla, Ascension Island, Bermuda, the British Virgin Islands, the Cayman Islands, the Falkland Islands, Gibraltar, Montserrat, Pitcairn, St Helena, Tristan da Cunha and the Turks and Caicos Islands.
Key themes of this year’s Council were building the prosperity and economic development of the territories and protecting the most vulnerable members of their populations, especially children. UK ministers and overseas territory leaders also discussed pensions, health, education, sports, child safeguarding and the role of the environment in delivering prosperity.
The Council agreed a communiqué which identified priorities and set out a number of important commitments and areas for joint work in the year ahead. On the high priority issue of company transparency, the territories agreed to hold company beneficial ownership information in central registers or similarly effective systems and to work with UK law enforcement authorities to develop timely, safe and secure information exchange processes for the purposes of law enforcement. We also agreed that all territories that have not already done so will undertake child safeguarding reviews by the end of 2016.
The communiqué reflects the commitment of the Governments of the overseas territories and the UK to continue to work in partnership to achieve the vision set out in the June 2012 White Paper: “The Overseas Territories: Security, Success and Sustainability”.
In line with our commitment in the White Paper, we will continue to report to Parliament on progress in implementing the commitments in the communiqué by UK Government Departments.
A copy of the communiqué and a report on UK progress in meeting the commitments from the 2014 Joint Ministerial Council has been published on the gov.uk website:
https://www.gov.uk/government/publications/overseas-territories-joint-ministerial-council-2015-communique
[HCWS399]
Police Integrity Reform
(8 years, 4 months ago)
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The Secretary of State for the Home Department (Mrs Theresa May)
The Government take policing integrity very seriously. It is at the heart of public confidence in the police and underpins the model of policing by consent. It is what gives rank and file officers the legitimacy to do their jobs effectively. The Home Office has responded to public confidence in police integrity by introducing a programme of measures to improve standards of conduct in the police. This follows various high-profile cases on police failures both current and historic, as well as numerous HMIC inspections and IPCC reports relating to corruption.
We are already expanding the IPCC to deal with all sensitive and serious cases involving the police. We have introduced legislation to prevent officers from escaping dismissal by retiring or resigning; we have introduced the holding of disciplinary hearings in public; and we are introducing legally qualified chairs in disciplinary hearings. The college has produced the code of ethics; laid in Parliament (July 2014) as a statutory code of practice.
In 2016 we will go further with an important programme of reform including primary legislation in the upcoming Bill. We will make the police complaints system more independent of the police through an expanded role for PCCs. We will change the definition of a complaint and simplify the system, making it easier for the public. We will introduce a system of super-complaints to enable systemic issues to be raised.
The “Improving police integrity” consultation, and the previous Government’s response to it in March 2015, set out several proposals to strengthen the IPCC. We will bring forward legislation to implement these proposals. They include the following measures: ending managed and supervised investigations; providing the IPCC with the power of initiative to instigate investigations; clarifying the ability of the IPCC to make determinations; giving the IPCC the power of remedy; and ensuring the IPCC can present its case at disciplinary hearings following an IPCC investigation.
The measures the Government have implemented and the further reforms announced will ensure that local communities continue to trust the police to uphold the highest standards of integrity—but that where they do not, the public are able to hold the police to account.
[HCWS400]
Northern Ireland Security Situation
(8 years, 4 months ago)
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The Secretary of State for Northern Ireland (Mrs Theresa Villiers)
This is the first written statement of this Parliament on the security situation in Northern Ireland. It covers the threat from domestic terrorism in Northern Ireland, rather than from international terrorism, which Members will be aware is the responsibility of my right hon. Friend the Home Secretary, who updates the House separately.
In the nine months since my last update to the House, the same small groups of dissident republican terrorists have continued their attempts to undermine Northern Ireland’s democratic institutions through the use of violence. The Police Service of Northern Ireland (PSNI) and MI5 have worked tirelessly to limit the threat they are able to pose. Because of these efforts the vast majority of Northern Ireland’s population are able to go about their daily lives untroubled by terrorism.
Continued vigilance is essential. The threat level in Northern Ireland from Northern Ireland related terrorism remains SEVERE (an attack is highly likely) and continues to evolve while the threat to Great Britain is MODERATE (an attack is possible but not likely). There have been 16 national security attacks by violent dissident republicans this year in which they have sought to cause harm and death. The primary targets have been PSNI officers, but prison officers and members of the armed forces have also been targeted.
In May and July two radio-controlled explosive devices were deployed in Belfast and Lurgan in an attempt to target security force personnel and, in June, an under-vehicle improvised explosive device was deployed against two off-duty PSNI officers at their home address in County Londonderry. Fatalities or serious casualties were avoided in these attacks by narrow margins.
In August a device initiated inside a postal van while it was parked in Palace barracks in County Down. No one was injured but there was considerable damage caused by the fire that followed to the vehicle and others nearby. In October a viable improvised explosive device was recovered from the grounds of a Londonderry hotel due to host a PSNI recruitment event, and several days later an under-vehicle device was planted in Belfast. It is fortunate that both devices were discovered before they exploded. The following day a military hand grenade was thrown at PSNI officers responding to reports of anti-social behaviour in Belfast; the grenade landed by the officers’ feet but thankfully did not explode. In November two police officers in their patrol vehicle in Belfast were extremely fortunate to escape uninjured when they were targeted with an automatic rifle.
The callous and reckless nature of these attacks means that there remains a very real threat of harm to members of the public. Even where there is no injury to people or damage to property, it is often the case that members of the public suffer significant disruption. This can include being forced out of their homes overnight while police deal with security alerts, not knowing if the device is real or hoax and always having to assume the worst.
As part of their unsuccessful attempts to prove their relevance to a society that wants to move on, these violent dissident republicans continue to resort to brutal assaults on members of their own communities in an attempt to exert fear and control.
Our Strategic Response
The Government are clear that terrorism will not succeed in Northern Ireland; democracy and consent will always prevail. Tackling terrorism remains a tier one risk, the highest priority for this Government. This approach is demonstrated in the provision of £231 million of additional security funding to the PSNI from 2011-16.
As a result of the strategic approach to tackling the threat from Northern Ireland-related terrorism pursued by this Government, the increase in terrorist activity that emerged in 2008 has been stemmed. There were 22 national security related attacks in 2014 compared with 40 in 2010. But the need for total vigilance in the face of the continuing threat remains.
The recent security and defence review confirmed we will continue to maintain our investment in capabilities to keep the people of Northern Ireland safe. Looking ahead, as the Chancellor confirmed in the spending review and autumn statement, the UK Government are making available £160 million in additional security funding to the PSNI over the next five years to assist their efforts to tackle terrorism. This is a significant package at a time of constrained spending and recognises the SEVERE threat from NIRT and the exceptional demands it places upon the police.
The PSNI and MI5 have continued to work incredibly hard in the period since my last update to the House, in many cases placing themselves at significant risk in order to keep people safe. The PSNI has made over 100 terrorism-related arrests of violent dissident republicans since the beginning of the year. In the Republic of Ireland, an intelligence-led operation by An Garda Siochana, the Republic of Ireland police force, resulted in a significant arrest and charge, as well as the seizure of a large quantity of bomb-making equipment. Joint working between PSNI, MI5 and the Garda remains crucial in the investigation and disruption of the violent dissident republican threat.
The Government welcome the enactment of the Justice Act (Northern Ireland) 2015 which was introduced by the Minister of Justice. Its provisions include measures to reform committal proceedings, reduce delay in criminal proceedings and enhance case management, which are important and necessary steps forward. The PSNI and MI5 go to tremendous effort to bring violent dissident republicans before the courts. It is vital, if the threat is to be tackled and people kept safe, that the criminal justice system as a whole is ready and equipped to deal with these cases. The Government welcome the commitment in the Fresh Start agreement by the Executive to further work to ensure cases can be processed through the courts more quickly.
I would like take this opportunity to pay tribute to the hard work of the Northern Ireland Prison Service who conduct themselves with exemplary dedication in what can be a very difficult environment.
Continuing Paramilitary Activity
On 20 October I published the assessment of structure, roles and purpose of paramilitary groups and made a statement to the House. The assessment stated that structures remain in place for both republican and loyalist groups. It is clear that individuals associated with paramilitary groups remain engaged in serious criminality. The continued existence and activities of these paramilitary groups, albeit much diminished from their peak, undermines the normalisation of our society. Paramilitary groups in Northern Ireland were not justified in the past and they are not justified today. During the recent political talks, the determination of the UK Government, the Northern Ireland Executive, and the Irish Government to achieve a Northern Ireland society free from the malign impact of paramilitarism was clear.
I welcome the commitments contained in the resulting Fresh Start agreement on this issue. These include an enhanced effort to tackle cross-jurisdictional organised crime, a new NI Executive strategy to disband paramilitary groups and the establishment of a monitoring and implementation body on progress towards ending paramilitarism. I look forward to continuing to work with all involved on this serious matter. Active support by members of the community and by political representatives is essential if we are to move towards a Northern Ireland where the legacy of paramilitary crime is no longer felt in our communities.
Parading Season
I applaud the efforts of all of those who worked together to ensure that the vast majority of parades across Northern Ireland were peaceful this year. While it is encouraging that we have not returned to the level of violence seen in 2013, it remains a matter of significant concern that disorder in Belfast over a three day period in July resulted in the injury of 25 police officers. This is completely unacceptable. In the same month, a rogue group of loyalists made a public statement to the media threatening PSNI officers and the Parades Commission. This too is unacceptable.
This Government will not tolerate acts or threats of violence by any part of the Northern Ireland community. The strain policing the parading season places on PSNI resources should not be ignored, with PSNI figures estimating the total cost to them of this year’s season at £6.7 million. There remains much to be done across the community to deal with instability caused by issues such as flags and parades.
Conclusion
The SEVERE level of threat we face from violent dissident republicans is likely to continue. It is likely that a number of the many attacks planned will continue to materialise but the police, working closely with the Garda, will exert every effort to disrupt this violent criminal activity and prosecute those responsible.
As the Government’s Northern Ireland manifesto made clear, there can be no greater responsibility than the safety and security of the people of Northern Ireland and of the whole of the United Kingdom. That is why will always give the fullest possible backing to the men and women of the PSNI who, working alongside other partners such as MI5 and An Garda Siochana, do such an outstanding job. I would like to thank them all for the work they do. Under this Government there will be no let-up in our efforts to ensure that terrorism never succeeds.
[HCWS394]
Rail Franchising: PQQ Passport Award
(8 years, 4 months ago)
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The Parliamentary Under-Secretary of State for Transport (Claire Perry)
I am pleased to inform the House that today we notified the first transport companies who have been successful in their pre-qualification questionnaire (PQQ) passport application. The PQQ passport is a new approach to the Department’s rigorous prequalification process in rail franchising and represents genuine innovation in procurement practice in Government for the passenger and taxpayer.
The following 11 companies will be able to submit their expression of interest for all future franchise competitions—within the lifetime of the passport—as from today, 15 December 2015.
Abellio Transport Group Ltd
Arriva UK Trains Ltd
First Rail Holdings Ltd
Go-Ahead Holding Ltd
Govia Ltd
Keolis (UK) Ltd
MTR Corporation (UK) Ltd
National Express Trains Ltd
Stagecoach Group Plc
Trenitalia SpA
Virgin Holdings Ltd
The quality of the submissions evidenced that we had explicitly sought high standards, integrity and professionalism from the national and international market. During the assessment stages we scrutinised and scored technical ability, strict safety standards and exemplary management practices. Our approach has resulted in a diverse and competitive market bidders from the UK and overseas who now hold the passport.
This brings a number of clear and positive outcomes: the passport is valid for a period of up to four years and in that time, applicants will be able to express their interest in all future franchise competitions without the need to submit the same information each time. This supports the Department’s effort to drive innovative customer-focused thinking and delivery from operators. Putting the passenger first is at the heart of all our franchise tenders and I believe this passport will keep the market fresh and dynamic.
The Department is focused on delivering better value for taxpayers and this announcement supports that. We can now focus our efforts on managing and negotiating the life-cycle of future franchises, build the necessary long-term industry relationships and continue to encourage parties from the UK and overseas to participate in our marketplace. This announcement is a hugely positive step and I am looking forward to seeing great results from a healthy, competitive open market.
[HCWS391]
Automatic Enrolment Annual Thresholds Review
(8 years, 4 months ago)
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The Parliamentary Under-Secretary of State for Work and Pensions (Mr Shailesh Vara)
My noble Friend the Minister of State, Department for Work and Pensions (Baroness Altmann) has made the following written statement.
I am today announcing the proposed automatic enrolment thresholds for next year.
It is intended to lay an Order before Parliament in the new year which will include the following: £43,000 for the upper limit of the qualifying earnings band.
The automatic enrolment earnings trigger will be frozen at £10,000. The lower limit of the qualifying earnings band will also remain frozen at £5,824.
I will also be placing a copy of the analysis supporting the proposed revised thresholds in the Library of the House and a copy can be found online at: www.gov.uk
[HCWS392]
Employment, Social Policy, Health and Consumer Affairs Council
(8 years, 4 months ago)
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The Minister for Employment (Priti Patel)
The Employment, Social Policy, Health and Consumer Affairs Council met on 7 December 2015 in Brussels. Baroness Neville-Rolfe, Under-Secretary of State at the Department for Business, Innovation and Skills, represented the UK.
The Council held a detailed discussion on the women on company boards directive but was unable to reach an agreement. The UK was part of the blocking group, with Baroness Neville-Rolfe setting out the significant success which had been achieved through the UK’s business led, voluntary approach.
The Council reached political agreement on a recommendation on the integration of the long-term unemployed into the labour market.
The European Commission presented the annual growth survey 2016 and a draft Council recommendation on the economic policy of the euro area, with views invited from member states. The UK intervened to welcome the package presented while raising concerns that issues relating to jobs and growth should continue to be discussed by all 28 member states, not just those in the eurozone.
The Commission presented measures to advance equal treatment of LGBTI people, with the UK highlighting actions it had taken at a national level such as equal marriage. There was an exchange of views on the strategic engagement for gender equality 2016-2019 and the Council took stock of progress on the equal treatment directive.
The Council adopted conclusions on equality between women and men in the area of decision making, the promotion of the social economy as a key driver of economic and social development in Europe and social governance for an inclusive Europe.
Under any other business, the presidency informed the Council about the successful negotiations with the European Parliament on both the EURES network and the platform against undeclared work.
The Commission set out the Accessibility Act proposal. The UK stated that the draft proposal must be in line with shared objectives on the single market and must have a firm evidence base with an impact assessment, but did welcome the lighter regime for small and micro businesses. The Commission gave a presentation on the youth employment pact which highlighted that the pact had created partnerships between educational organisations and businesses. Finally, the Luxembourg delegation drew attention to the various initiatives and conferences they had undertaken as part of their presidency.
[HCWS395]
House of Lords
Oaths and Affirmations
Schools: Exclusions
Lord Lupton
To ask Her Majesty’s Government whether they will consider introducing a higher duty of care on head teachers when excluding children aged under 16 from their schools to ensure that such children are in practice met by a parent, guardian or approved carer.
Baroness Evans of Bowes Park (Con)
My Lords, the Government have produced statutory guidance which stresses that head teachers must take account of their legal duty of care when sending a pupil home following an exclusion. Head teachers will use their own judgment when sending pupils home, depending on the child’s age, specific needs and ability to understand the situation. The Government believe it is right that such judgments should be made by head teachers.
Lord Lupton (Con)
My Lords, given this Government’s strong commitment to child protection and the support network which we often assume exists for very troubled children when there is no such network, as there may be no real families or functioning parents as we understand them, does my noble friend agree that the Government should revise regulations so as to require head teachers to ensure that they release excluded children to a responsible adult and, where necessary, notify the social services or the troubled families workers?
Baroness Evans of Bowes Park
My noble friend will know that head teachers do not take lightly decisions to exclude pupils. He will also be aware that school staff have an ongoing responsibility for safeguarding pupils, whether at home or at school. Where a head teacher has concerns about the welfare of a pupil, they will be working with a range of local services, such as social services and safeguarding teams or local alternative providers, to make sure that there is a safe environment for them.
Baroness Whitaker (Lab)
My Lords, what are the Government going to do about the disproportionate number of Traveller boys excluded from school?
Baroness Evans of Bowes Park
We take this issue seriously; that is why we are putting a lot of work and effort at a local level into things such as the troubled families programme to help provide integrated family support. A lot of these families have complex needs, which need integrated support on the ground, and that is how we can help them ensure that their children get the education they deserve.
Lord Storey (LD)
My Lords, there is extensive research which shows that suspension often makes it worse for the child, the family and indeed the teacher. Suspension and exclusion alone will not solve that child’s problems. Will the Minister consider holding a round-table discussion with the relevant people to look at practices that we could evolve to help children who are suspended and excluded from school?
Baroness Evans of Bowes Park
The most important thing is ensuring that any child who has been excluded or suspended returns to a school where they have a high-quality place, be that in a mainstream school to which they may have been moved or, equally, in an alternative provision setting. That is why we have taken great steps to improve alternative provision, both by improving the governance of existing PRUs and by allowing academies and free schools to open new provision. That is performing well and ensures that these vulnerable young people get the kind of education that will re-engage them.
Lord Elton (Con)
My Lords, exclusion from school is one of the most reliable predictors of criminality in young people if they fall outside the provisions that my noble friend has just referred to. What can the Government do to establish a wider net so that fewer people fall through this, predictably, into prison?
Baroness Evans of Bowes Park
As I mentioned, one of the main initiatives is the troubled families programme. It originally helped 116,000 families, but it will be expanded over the course of this Parliament to help up to 400,000 families. Its aim is to bring together local authorities, police, housing, employment advisers, schools, health and children’s social services to deliver integrated, whole-family support. That is what needs to happen to make sure that families do not go through a continuing cycle of deprivation.
Lord Ramsbotham (CB)
My Lords, can the Minister tell the House what has happened to the zero exclusion project, which was introduced by the previous Secretary of State?
Baroness Evans of Bowes Park
I am afraid I will have to write to the noble Lord.
Baroness Howells of St Davids (Lab)
My Lords, I would impress upon the Minister that something has to be done. I am often called by parents whose children have been wandering the streets, as when the child is excluded, they are either angry or frustrated and there is often no one to take them home or look after them. Heads of schools should realise that they are in loco parentis and that they ought to ensure the safety of the children. It creates a downward spiral when the adult who is in charge at the time ceases to look after the child in their care. Can the Minister at least try to see how this can be avoided? I spend most of my time reading letters from people whose children have been left wandering, which can cause the prisons to be full of disillusioned children. I would like the Minister’s help with this, and thank the noble Lord for asking the Question.
Baroness Evans of Bowes Park
The noble Baroness is absolutely right. As I said previously, school staff have a duty of care to pupils, whether they are at school or at home. Many head teachers do not exclude people even when they legally could, because they understand the home situation. That is why we are also looking to improve alternative provision and other, more local initiatives around family support— to make sure that we can help these young people and that they get out of the cycle that they may be in.
Lord Watson of Invergowrie (Lab)
My Lords, would the noble Baroness accept that, although the DfE guidelines could be amended—perhaps better to reflect best practice on exclusions currently followed by head teachers—to add a further statutory duty, as suggested by the noble Lord, Lord Lupton, would not be appropriate given all the other duties added to those of school teachers? It would be neither necessary nor appropriate.
Baroness Evans of Bowes Park
As I have said, head teachers do not take these decisions lightly and they have a duty of care. We believe that the overwhelming majority of schools and head teachers work very well and closely with local services in order to make sure that there is provision to support both these young people and their families, who often have many complex needs and need broad help from local services.
Planning Permission
Lord Borwick
To ask Her Majesty’s Government what assessment they have made of the current time delay between a council’s resolution to grant planning permission and the issue of implementable planning permission on housing sites of 50 houses or more; and what steps they plan to take to reduce that delay.
Lord Borwick (Con)
Declaring my interests in the register, I beg leave to ask the Question standing in my name on the Order Paper.
The Parliamentary Under-Secretary of State, Department for Communities and Local Government (Baroness Williams of Trafford) (Con)
My Lords, our reforms are driving up performance on deciding applications for major development. In spring 2015, 78% of major applications were decided on time, compared to 57% in summer 2012. We are taking steps to drive further improvement, including introducing a dispute resolution process for Section 106 agreements. The time between resolution to grant and full planning permission is not monitored.
Lord Borwick
I thank my noble friend for those figures, which show that the speed of processing applications is indeed accelerating. However, I am told that the number of applications that are still outstanding after one year is at present around 13% and growing, and these are the big schemes with lots of social housing in them. Can the Minister tell us of any plans to accelerate the big schemes?
Baroness Williams of Trafford
My Lords, I do not recognise the 13% figure cited by my noble friend, because we do not publish national statistics on the percentage of decisions outstanding after a year. We publish figures on the periods within which a decision has been made. For major developments, in the most recent quarter, 10% of applications took more than a year to decide, or were decided after the end of an agreed extended time period, as set out in the planning performance agreement or extension of time, which could be anything over 13 or 16 weeks.
Lord Hain (Lab)
If Schengen was suspended, why would the French Government—
Lord Clark of Windermere (Lab)
My Lords, it is very welcome that we have seen an increase in earlier decisions being made, but, given the Government’s commitment to localism, is the Minister content that this is because more and more decisions are being made under delegated council decisions where the planning decisions are made by local government officials? In sensitive issues, that really should be the decision of elected councillors.
Baroness Williams of Trafford
I am very glad that the Question is not about Schengen, by the way; I would have struggled.
On planning decisions being made by officials, provisions have always been in place that officials can take certain decisions, particularly where they are uncontentious. However, the localising of planning decision-making through neighbourhood plans and local plans has made for happier communities that are far more likely to go along with planning decisions when they are made.
Baroness Pinnock (LD)
My Lords, in my small town in West Yorkshire, there are four planning consents for more than 500 houses awaiting development. In some cases, they have been awaiting development for more than two years. Does the Minister agree that because they are on brownfield sites, which are clearly more expensive to develop, the Government’s apparent commitment to developing brownfield sites first is barely credible when developers can wait for green land relief, where the profit margins are greater?
Baroness Williams of Trafford
My Lords, it is absolutely right to develop brownfield sites first. We want to avoid development of greenfield land and build on brownfield land first. That is why we have designated brownfield sites as a priority for our housebuilding.
Lord Beecham (Lab)
My Lords, delays in planning matters are of course to be regretted, but it is very likely that there will be more delays in future, given the reductions in planning staff across many authorities of all political colours as a result of the Government’s cuts. However, in Newcastle, in a ward which the Minister had the pleasure of visiting recently, there are two housing schemes which the council wished to promote with housing associations. The fact is that two of the potentially interested bodies withdrew because of concerns about the impact of the Government’s policies on housing association rents and the right to buy on their capacity to enter into the development. The third organisation is yet to make its mind up. Will the Government not recognise that they need to take into account the role of housing associations, and look again at the proposals which will make it more difficult for them to engage in housebuilding?
Baroness Williams of Trafford
My Lords, perhaps I can answer the second part of the question of the noble Baroness, Lady Pinnock, as well as this one. In terms of the role of housing associations and reluctance to build, 96% of housing association stock providers have signed up to the right-to-buy deal with the Government. In Scotswood, where I saw the Rise development, which is incredibly impressive, they are building ahead of time. In terms of speeding up the process, we will be bringing forward measures to drive up performance within planning authorities. In terms of capacity to deliver, which we discussed only yesterday evening, there are funds to enable local planning authorities to build in capacity to enable them to deliver some of the Government’s new priorities.
Lord Burnett (LD)
My Lords, I draw the House’s attention to my entries in the register of interests. The planning process must be profitable for local planning authorities. In the West Country, many local planning authorities have insufficient qualified planning officers. Is there anything that the Minister can do to encourage local planning authorities to recruit more qualified planning officers?
Baroness Williams of Trafford
My Lords, I think that I partly answered that in answer to the noble Lord, Lord Beecham. In small planning authorities, particularly in district authorities, there is every reason why authorities should share functions, if the authorities are particularly small.
Lord Harris of Haringey (Lab)
My Lords, I do not think that, in answering the question asked by my noble friend Lord Beecham, the Minister really addressed the central issue. My noble friend gave two examples of housing associations that have withdrawn from schemes because they do not think that they are now viable, given government policies. What evidence do the Government have that their policies towards housing associations are not going to choke off new housing development for affordable homes?
Baroness Williams of Trafford
My Lords, I think that our record in the last Parliament is evidence enough.
European Union: Schengen Agreement
(8 years, 4 months ago)
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Lord Forsyth of Drumlean
To ask Her Majesty’s Government whether they will encourage the European Union to suspend the Schengen arrangements and reinstate border controls between member states.
The Minister of State, Home Office (Lord Bates) (Con)
My Lords, the reintroduction of border controls within the Schengen area is ultimately a decision for the Schengen states themselves. However, given the possible security threats, the Government have a strong interest in ensuring that Schengen states effectively combat illegal transit into and across their borders.
Lord Forsyth of Drumlean (Con)
My Lords, I am grateful for that Answer. Does my noble friend agree that a Government’s first duty is to protect the security and well-being of their people? Given that the European Union has failed to police both its external and internal borders, is it not the duty of the Prime Minister to regain control of Britain’s borders?
Lord Bates
Of course, my noble friend is absolutely right, and we have control of those borders because, in the Maastricht treaty, as he and I know, Sir John Major managed to negotiate an opt-out from the Schengen area. We retain strong control over our borders, which is quite essential. We look at the situation happening in Europe at present and we are not dispassionate, because the issues and security concerns that we have about Europe ultimately come towards us—so we need to work with our EU partners. We believe that the type of discussion that they are now having about strengthening the external border to the EU is absolutely right and timely.
Baroness Ludford (LD)
Does the Minister agree that any crowing over Schengen difficulties is misplaced and shooting ourselves in the foot, given the huge benefits to UK citizens and businesses that Schengen confers in the ease of travel and trade? What are the Government doing to help to maintain the integrity and security of Schengen through full participation in the Schengen Information System and helping to reinforce its external borders?
Lord Bates
The noble Baroness is absolutely right, and there is absolutely no crowing whatever. What we want is the security of those internal and external borders. We are joining the Schengen Information System II, which is very important for sharing information. We are providing support to FRONTEX and also providing support to the European asylum support officers, who operate in hotspots around Italy, Greece and Bulgaria. So we are not passive or crowing—we are actively working with our EU partners to ensure that this problem is addressed.
Lord Hain (Lab)
My Lords, I apologise for my premature enthusiasm earlier—bad habits brought from down the Corridor. If Schengen were suspended, why would the French feel any obligation to maintain our border in Calais?
Lord Bates
That is a good question. I wish the noble Lord had continued a little further in his first intervention and then I might have heard it before. The important point is that the juxtaposed controls which we have with Belgium at Coquelles and also at Calais are essential partnerships. It is very important that they are maintained. We do not believe that Schengen is in danger of suspension at present. There may be members of it, such as Greece, which are causing concern and certain members which are exercising their rights under Article 23 to suspend the operation of those borders for a time. However, it would have implications for us, and that is why we are following it very closely and will offer every support we can to our EU partners.
Lord Hylton (CB)
My Lords, does the Minister agree that fences and border controls provide no solutions? Surely men, women and children already in Europe deserve decent treatment. While camps may sometimes be necessary for purposes of assessment, will the Government ensure that the aim is always settlement or return home so that people do not rot in bad conditions?
Lord Bates
That is a very important point. One of the things that we have done in supporting Greece is to provide DfID aid to ensure that the centres where people’s applications are processed have the type of decent humanitarian care which Europe and this country have a proud record in delivering.
Lord Reid of Cardowan (Lab)
My Lords, to get to the crux of the matter, is it not obvious to everyone, including government Ministers, that, given what happened in Paris, the arrests in Belgium, Switzerland and elsewhere and the influx of refugees through the borders of Europe, the ability to move through 26 European countries with no scrutiny at the border is a boon to terrorists? Notwithstanding the fact that we are not in Schengen, the fact that if you come inside the borders of Greece you can travel right across Europe to the coast of Belgium and northern France puts immense pressure on our borders. Should the Government not be doing something to have those borders restored for our own sake, if not for the European Union’s sake?
Lord Bates
They need to come forward with some answers. The European Commission has today produced some proposals on strengthening the borders. The noble Lord is right to say that this is not something we can walk away from but is something that impacts on us. It is also the reason why we need to tackle the situation at the border, strengthen our EU borders and, given that we know what the cause of this is, take action in Syria with the international community to ensure that this situation is resolved and the cause of this influx is somehow altered.
Lord Lawson of Blaby (Con)
My Lords, would my noble friend, whom I greatly respect, like to correct his Answer to my noble friend Lord Forsyth—
The Lord Privy Seal (Baroness Stowell of Beeston) (Con)
My Lords, I thought my noble friend had finished asking his question. I suggest that we allow him to finish his question and then go to the noble Lord, Lord Pearson.
Lord Lawson of Blaby
Would my noble friend, whom I greatly respect, like to correct his Answer to my noble friend Lord Forsyth? In answering, he said that we had control of our borders. So far as the European Union is concerned, we do not. Even though we are not in Schengen, we do not have control of our borders.
Lord Bates
I was making the point that our borders are controlled in the sense that the ability to travel freely across borders in the European Union by the production of an ID card does not apply to us. In Schengen, we retain our full checks on people who are coming into this country and, since April this year, on people leaving this country as well. I believe that that means we have control of our borders.
Lord Pearson of Rannoch
My Lords, given that Schengen and the euro have proved such painful failures, what do Her Majesty’s Government see as the point of the European Union itself? Would we miss it if it collapsed and we went back to friendly collaboration and free trade between the democracies of Europe? Has the EU not become just a very expensive emperor without clothes?
Lord Bates
The benefits to this country will be determined by the people in a referendum in due course, but in this respect they are self-evident: we cannot deal with the migrant crisis that is coming into our country without working very closely with our EU partners and, given that seven out of 10 of our principal trading partners are within the EU, we need to be able to exchange goods and services in an efficient way. With regard to the type of model that the noble Lord is perhaps advocating, he should perhaps be aware that while we are not in the Schengen area, Norway, Switzerland, Lichtenstein and Iceland, in the European Economic Area, are part of Schengen, and therefore there is free movement.
Down’s Syndrome: Do Not Resuscitate Orders
(8 years, 4 months ago)
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Lord Alton of Liverpool
To ask Her Majesty’s Government what assessment they have made of East Kent Hospitals University NHS Trust’s decision to list Down’s syndrome as a reason to issue a Do Not Resuscitate order to a patient.
The Parliamentary Under-Secretary of State, Department of Health (Lord Prior of Brampton) (Con)
The department expects trusts to have local policies on resuscitation, based on expert professional guidance. Such guidance has been published jointly by the British Medical Association, the Resuscitation Council and the Royal College of Nursing. All resuscitation decisions must be tailored to the individual circumstances of the patient. For patients who lack capacity, the Mental Capacity Act requires a decision in their best interests, taking account of their known wishes, beliefs and values.
Lord Alton of Liverpool (CB)
My Lords, in considering Mencap’s estimate that 1,200 people with learning difficulties die needlessly in NHS care every year, will the Minister look at the inspiring work of the Blue Apple Theatre company, which includes actors with Down’s syndrome performing either “Hamlet” or their play “Living Without Fear”, which was staged in Mr Speaker’s House, and then consider how best we can counter a slide into eugenics, discrimination and non-resuscitation orders, as in the case of Andrew Waters, and look for ways to promote positive and life-affirming attitudes towards people with Down’s syndrome?
Lord Prior of Brampton
My Lords, perhaps I could address first the particular issue of Andrew Waters. The doctor who signed the DNR order was a junior doctor who made a mistake. It was a misjudgement, he apologised for that mistake, and he has learnt from it by using his experience to teach other doctors how to deal with similar issues. It is important to make that statement first—the reaction of that junior doctor was the right one, having made that mistake. The noble Lord mentioned the Blue Apple Theatre company. He was kind enough to send me a copy of some of the work that it does, which illustrates that people with Down’s syndrome can have a very full, useful, good and happy life, and their lives should be valued just as highly as the life of any other person.
Baroness Walmsley (LD)
My Lords, does the Minister know how widespread such discrimination is against people with learning difficulties? What reassurance can he give to parents such as those I met recently in the House of Commons Dining Room, who were terrified to allow their disabled son to go into hospital because they knew they were going to be put under pressure to sign a DNR notice? They were also afraid that, even if they refused but were not at his bedside 24 hours a day, it would happen anyway.
Lord Prior of Brampton
My Lords, the noble Baroness has just made a truly shocking statement. If indeed this practice was systemic and widespread, it would be a matter of huge concern and I think all of us in this House would be appalled by it. I have no evidence that this is a systemic problem, but it is absolutely the case that this group of very vulnerable people have been let down not just by doctors and clinicians but actually by all of us—the whole of society, for ever. The report produced three weeks ago called Building the Right Support recognised that we have let down this group for decades, and I hope that over the next five years we can start to make amends.
Baroness McIntosh of Hudnall (Lab)
My Lords, in his original Answer the Minister referred to the Mental Capacity Act, which is widely admired as legislation that is on the whole benign. However, he will be aware that a Select Committee of your Lordships’ House met last year and produced a report that pointed out that the implementation of the Act is not always as effective as it should be, which has a lot to do with the way health professionals understand their duty under the Act in situations such as this. What progress is being made in improving the training of health professionals under the Act?
Lord Prior of Brampton
My Lords, the noble Baroness will be aware that the noble Baroness, Lady Finlay, has become chairman of the National Mental Capacity Forum, which was established in September. She will be looking at all these issues and reporting back in March next year. I entirely agree with the noble Baroness, Lady McIntosh, that the principles in the Act are generally accepted as being the right ones, but their application has not been as consistent as we would like.
The Lord Bishop of Peterborough
My Lords, from these Benches we affirm that those with Down’s syndrome and other learning disabilities and handicaps are fully human and fully made in the image of God. We believe that the chief mark of a civilised society is the way it cares for the most vulnerable. Can the Government, through the Minister, indicate what they can do to change the culture, training and attitudes within the NHS—and perhaps within society more widely—to make sure that mistakes such as the one made by this junior doctor are not made again?
Lord Prior of Brampton
My Lords, the right reverend Prelate makes a number of very important points. This is a society issue as much as a medical issue. Before coming into the Chamber today I discussed with the noble Baroness, Lady Hollins, the importance of teaching students at medical school how to value people with learning difficulties, and the important role that people with learning disabilities might play by going to medical schools and directly telling medical students about their lives and concerns.
Baroness Hollins (CB)
The assumption that pregnant women who are expecting a baby with Down’s syndrome will abort that child affects public and medical attitudes. As one woman with Down’s syndrome put it when speaking at a conference on prenatal diagnosis, “You want to kill us”, which is a hard perspective for an adult with Down’s syndrome to hear. I am grateful to the Minister for picking up the point that medical nursing students need to learn from people with learning disabilities, so that their attitudes change. That familiarity with and being comfortable with people with learning disabilities will change things. Will the noble Lord commit to asking the General Medical Council, the Nursing and Midwifery Council and the Medical Schools Council to make this a priority and to teach not just knowledge and skills but practical attitudes to people with learning disabilities?
Lord Prior of Brampton
My Lords, the noble Baroness makes a profound point—that medical education and training is not just about passing exams and the technicalities of medicine but about attitudes and how you work and deal with people, particularly people such as those who suffer from learning difficulties. I will certainly do what I can to encourage medical schools and nursing schools to adopt the noble Baroness’s suggestion.
Onshore Hydraulic Fracturing (Protected Areas) Regulations 2015
(8 years, 4 months ago)
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Lord Bourne of Aberystwyth
That the draft Regulations laid before the House on 16 July be approved.
Relevant documents: 3rd Report from the Joint Committee on Statutory Instruments, 8th Report from the Secondary Legislation Scrutiny Committee. Considered in Grand Committee on 24 November.
Paris Climate Change Conference
(8 years, 4 months ago)
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The Parliamentary Under-Secretary of State, Department of Energy and Climate Change and Wales Office (Lord Bourne of Aberystwyth) (Con)
My Lords, with the leave of the House, I will now repeat a Statement made by my right honourable friend the Secretary of State for Energy and Climate Change in another place. The Statement is as follows.
“Mr Speaker, it gives me great pleasure to report to the House on the United Nations conference of parties in Paris last week. COP 21 has delivered a historic new global climate change agreement that takes a significant step forward towards reducing, on a global scale, the emissions that cause climate change. For the first time, nearly 200 countries have made a commitment to act together and to be held accountable. In doing so, this agreement will help protect not just our environment but our national and economic security, now and for generations to come. As the Prime Minister said in his speech at the start of conference,
‘instead of making excuses tomorrow to our children and grandchildren, we should be taking action against climate change today’.
I am proud to say there are no more excuses. With the Paris agreement, we have shown that the world has committed to action.
This deal is unequivocally in Britain’s national interest. It moves us towards a level playing field at a global level within which the United Kingdom’s society and businesses can thrive, as we transition to a low-carbon economy. This is a deal we are wholeheartedly committed to, recognising that action by one state alone cannot and will not solve climate change. It is what we do together that counts.
I would like to say that this is a moment that all parties in this House can take significant credit for. Together, we passed the Climate Change Act 2008, which set an example to the world of what ambitious domestic climate action looks like. Together, since Copenhagen in 2009, we have supported a long, difficult and complex negotiation, which has brought us to this point. I want to pay tribute not just to the Prime Minister and my colleagues across government, but to my predecessors as Secretary of State for Energy and Climate Change for all the hard work they put in to bring us to this point.
As a country, we should be proud of the role we have played, leading in the EU, working closely with major global players, including the United States and China, and leading many of the negotiations. My department, with the FCO and DfID, has worked tirelessly to build the political conditions and the capacity to enable countries to act. The United Kingdom team in Paris last week showed commitment, passion and resilience. When Laurent Fabius asked me to chair the finance session at 4 am on Friday morning, I was well supported, and when I left at 6.30 in the morning, the team stayed to write up the conclusions and send them to the presidency. That, Mr Speaker, is commitment.
The United Kingdom played a key role in building alliances and shared positions, especially with the most vulnerable countries, to ensure that pressure for ambition could be maximised. This deal in Paris was not done to us; it was done by us. Indeed, it reflects many of the elements that we as a country have already committed to as part of the Climate Change Act. Of course, Paris is not the end of the road. We cannot sit back and say, ‘Job done’—far from it. Paris is the beginning. Now, the hard work to implement the agreement begins.
I turn to what the nearly 200 countries have agreed. First, we have set out a clear long-term goal for the world to achieve net zero emissions by the end of the century. That long-term goal sends a strong signal to investors, businesses and policymakers that the shift to a global low-carbon economy will happen and it provides the confidence needed to drive the scale of investment required. We have confirmed our collective ambition to limit global temperature rises to below 2 degrees, and we have agreed a further aspiration of 1.5 degrees.
However, the current level of commitments by individual countries will not meet that ambition. So, crucially, countries will come back to the table to assess overall progress towards the 2 degrees goal in 2018 and every five years thereafter. As investment grows and the costs of low-carbon technologies come down, the Paris process will provide not just the opportunity but the political pressure to step up individual countries’ emissions reductions targets. Starting in 2020, countries are expected to update their own plans to cut emissions and will be legally obliged to do so again every five years, thus providing regular political moments to scale up ambition.
This agreement is not only comprehensive in its scope; it also recognises the role of both developed economies and emerging economies in helping the poorest and most vulnerable countries to protect themselves from the effects of climate change as they transition to a low-carbon economy.
Over the last five years, the United Kingdom’s £3.87 billion International Climate Fund has been helping millions of the world’s poor to better withstand weather extremes and rising temperatures. At the United Nations Secretary-General’s summit in September, the Prime Minister announced a significant uplift to increase climate finance by at least 50%, with £5.8 billion of climate finance over the next five years to support poor and vulnerable countries to adapt to climate change and to curb emissions. This is part of a global commitment to mobilise $100 billion per year from both the public and the private sectors to protect the most vulnerable and support economic growth from 2020. Other developed countries, including Germany, France, the United States, Japan and Canada, have all recently announced increases in their climate finance as well.
As important as the Paris agreement is, we will achieve our ultimate ambition only if it acts as a catalyst for transformational action from all parts of society. That is why it has been so important to see real action over the last month from business and civil society. For example, a new international initiative, ‘Mission Innovation’, will see some of the biggest global economies, including the United Kingdom, the United States and India, doubling their investments in clean energy research and development. Crucially, private investors will join us in this endeavour to bring down the costs of low-carbon technologies.
Here in the United Kingdom, we have committed to double spending in clean energy research and development, so that by 2020 we will be spending in excess of £400 million. This pledge has been matched by 19 other countries worldwide. This is in recognition of the fact that we will tackle climate change only if we find technologies that are both clean and cheap. Let me tell you that the announcement I made last month—that I would set out proposals to close coal by 2025 and restrict its use from 2023—added to the momentum in Paris.
The Paris agreement truly marks a historic turning-point. It builds on the Kyoto protocol and, for the first time ever, provides the comprehensive framework in which not just developed countries but almost every country of the world has committed to take the global action needed to solve a global problem. Of course it was hard fought; of course it required compromise to bring everyone with us; of course it has not solved every problem in one go.
Now, we have to set about implementing the commitments made, but we should not underestimate the significance of what has been achieved. All parties have recognised that economic and global security requires us to tackle climate change. All have come together to commit to a single goal: net zero carbon emissions by the end of the century. All have agreed to set out plans to curb emissions and be held accountable for their actions. We have made a huge step forward in meeting our responsibilities to this and future generations. As the excellent executive secretary to the UNFCCC, Christiana Figueres, said, ‘I used to say we can, we must, we will. Now I can say we did’”.
Lord Grantchester (Lab)
I thank the Minister for repeating the Statement today. He is quite right to celebrate the agreement’s achievement and the role that all recent UK Governments have played to bring this about.
All Governments have agreed to the common goal to decarbonise their economies within one generation, to limit increases in global temperatures to below 2 degrees and to target 1.5 degrees. All Governments have agreed to achieve net zero emissions before 2050 and the end of the century to cut pollution and curb carbon emissions. All Governments have agreed to review progress and raise ambitions every five years to make sure that the job gets done. Developed nations have agreed to help fund the developing nations’ transition to clean energy with a flow of $100 billion a year beyond 2020.
The commitment achieved by consensus is immense. The Paris conference witnessed the greatest get-together of world leaders, with 50,000 people in attendance and the dedications of scientists, campaign groups and interest organisations in mobilising public support to insist on an agreement being achieved. This historic achievement was won in a forum of one country, one voice; unlike other intergovernment forums dominated by richer countries, as in the G7, G20, OECD and OPEC. China, the US, the EU and India are responsible for 61% of global emissions but other nations have an equal voice at the UNFCCC. The French must be congratulated for facilitating the conference, working tirelessly to resolve disputes.
The Minister is right to highlight the role played by successive UK Governments and the British Parliament. Now that this Government are the first Conservative Government for 18 years, this is not the time to abandon that consensus. It must be recognised that scientists still point to the dangers that even a rise of 2 degrees will bring and the trajectory that the world is on.
This agreement needs to be followed up by outcomes. In this respect, I congratulate the Government on the decision to phase out coal-powered generation by 2025. Last week, the Minister stated that domestic policies do not resonate on an international stage. His Government cannot think that fine words need not be matched by deeds.
In the Energy Bill 2013, the Government refused to set a 2030 decarbonisation target. There has followed a litany of reversals to important schemes designed to put the UK on track to a low-carbon economy. The UK’s commitment to reach renewable energy targets of 15% by 2020 is in jeopardy. PWC estimates that if the renewables contributions from heat and transport remain at their present levels, the UK will need to generate 52% of electricity from renewables to meet that target.
The Government have attacked the cheapest options for achieving these targets, such as onshore wind, meaning that energy bills will increase by more than they need to. The Green Deal efficiency measures have been abandoned. Carbon capture and storage projects in Yorkshire and Scotland have been axed. Polluting diesel generators have been rewarded with 15-year contracts totalling more than £150 million in the latest capacity auctions.
The UK still requires significant investment in low-carbon technologies. Investor confidence is now undermined by continual sharp policy shifts such as are proposed in the latest Energy Bill. Friends of the Earth states:
“It will be outstanding hypocrisy for the government to trumpet the new climate change agreement unless it does a U-turn on energy policy”.
Will these green policy reversals now be reviewed in the context of the commitments given at Paris? Will the Minister ask the independent Committee on Climate Change to review the progress towards and likely achievement of the UK’s renewable generation target, and whether there should be further policy initiatives to get the UK back to achieving 15% of energy from renewables by 2020?
In Paris, the global ambition has been set to reduce temperature rises from 2 degrees to 1.5 degrees. What further measures does the Minister’s department now consider are necessary?
Lord Teverson (LD)
My Lords, what a great result for all sides of this House, for the nation and for the international community. I do not think that we can say more strongly than has the Minister how great this result is. After the pessimism—the omnishambles, we could say—of Copenhagen in 2009, this is truly a good and remarkable result. We should certainly congratulate the French Government, and Laurent Fabius in particular, on their stewardship and their achievement at this conference.
The great thing is that those of us who believe that climate change really is one of the greatest issues facing this planet can be positive again, since for the past six years we have been rather on the defensive and pessimistic about outcomes. What we have here is an agreement not just between 196 nations but an agreement particularly that China, the United States, India and Europe have agreed to. That is quite something and it would have been unbelievable just a few years ago.
We also have something else to celebrate. In 2014, the globe’s emissions were roughly the same—they levelled out for the first time during a period when there was global economic growth—and, this year, we hope that there will be something like a 1% reduction in carbon emissions. So we can move forward with confidence that we are achieving something and perhaps prove wrong the pessimists or disbelievers among us, not just through the science but by showing that real-world Governments, including in the developing world, are taking notice that this is a problem that needs to be solved.
I welcome particularly in this agreement the integration between developed and developing nations—there is not the big divide that there was under Kyoto and China’s emissions this year are falling by some 3% to 4%. I welcome, too, that we will have a proper review programme every five years, starting in 2018—we are not waiting for five years until we start that process—and that we realise that, for those island states in the Pacific and elsewhere, the real challenge should be 1.5 degrees and not 2 degrees, difficult though that will be. Those are great achievements and I welcome the Secretary of State’s Statement, and in particular her thanks to previous Secretaries of State—I think of my former right honourable colleague Ed Davey in that regard.
But we have a problem here: we need those nations to move forward on those agendas, and that includes the United Kingdom. While I agree with the Minister entirely that we have had a positive reaction in ridding ourselves of coal emissions within the next 10 years and increased investment in technology around the green agenda, so far this year we have had a reversal of a number of policies that are really important for driving our commitments forward in this area. The House does not have to believe me because the chief executives of companies such as Panasonic, BT, M&S, Tesco, Vodafone, Ikea and many others have written to the Government saying that this policy change has been in the wrong direction and needs to change. Those are real challenges.
We will come to the fifth carbon budget and I hope that the Government will move forward positively when it comes to decisions, unlike with the difficulties that there were— particularly from the Treasury—when we looked at the fourth carbon budget in the past.
On behalf of my Benches, I welcome this agreement. As the Minister said, it is not the end but it is the beginning of reaching a solution to climate change on this planet. It is the most important way of going forward. Of all the policies that are most important for implementing this agreement, perhaps the cheapest and most effective is the one of energy efficiency. The Government’s move away from zero-carbon homes for 2016 and commercial buildings for 2019 was one of the most negative policies that they could have implemented. My challenge to the Minister is to ask the Secretary of State to reverse at least that one policy so that we can start on the road to fulfilling this agreement.
Lord Bourne of Aberystwyth
My Lords, I thank the noble Lord, Lord Grantchester, for his comments and welcome him for the first time to the Front Bench in this House in his new role. I wish him well.
The noble Lord is right to talk about the significance of Paris. It is crucially important. He is also right to talk about the importance of small states. All nations came together and during the debates and negotiations there was as much, if not more, mention of the Maldives, Tuvalu and the Seychelles as of many larger states—and quite right, too, as they are very vulnerable countries that should touch the conscience of the world. The United Kingdom had a particular interest in guarding their interests, as the Prime Minister set out at the start of the conference.
The noble Lord is right also to say that we should pay tribute to France for what it did, not only for its diplomacy, which was extraordinary, but for managing the conference, particularly given the particular security and terrorist problems that it faced. It was an outstanding achievement. I thank him also for what he rightly said about the consensus around this issue among the parties here. That was right.
On domestic policies, I can say with all honesty that, as far as I am aware, the only time at any of the meetings I attended when domestic policies were mentioned was in the context of the closure of coal. This was borne out by our negotiators to whom I spoke. It certainly captured the world’s imagination. That is not to say that other issues are unimportant, but it was significant and a key moment when this country moved first on that issue.
The other important point in relation to what happened in Paris is that it gives a clear investment signal to the whole world which will help reduce costs still further. They are on a cheap spiral and are coming down anyway and no one wants to see subsidies for a long period. There may be disagreement about when they are phased out, but a clear message was sent out. I note what the noble Lord said about Friends of the Earth—they have never been particular friends of any Government—but I stress more the importance of the strong welcome given by the CBI to what was agreed.
We were fully signed up to and pressing for the 1.5% goal to which the noble referred. It did not come as something that we did not want; it was good news. Not all countries were pressing for it and I can certainly remember attending meetings where I spoke up in favour of it, as did many other EU countries and progressive allies. We certainly wanted it and we will now develop policies in the light of the challenges that we face. However, they are already on course to deliver this sort of change.
Moving on to the contribution of the noble Lord, Lord Teverson, I thank him for his kind words and the warm welcome he has given to the conference; it was very gracious and generous. He mentioned the role of France, and both Laurent Fabius and Ségolène Royal played an enormous role in organising this agreement so successfully. He mentioned global emissions peaking in the near distance moving forward, which is absolutely true, as well as the slight blurring of the issue between developed and developing countries. That is right and it is something that the EU and the UK were pushing hard for because many states are developing quickly, and, without the invidious dimension, some do not look like developing countries any longer, thank goodness.
He also mentioned domestic policy. I can only refer him to what I said earlier, but I can reassure him on the two issues he finished on. First, Paris is not an end in itself: that is true. It is the road through Paris that is important, hence the five-yearly stock-take that will start in 2018 when we will assess how much progress we have made in relation to reducing emissions on a global basis, as well as the other five-year cycle when we will come back and, it is hoped, ratchet up our ambitions—or, in the case of some states, perhaps restate their ambitions.
The noble Lord made a point about energy efficiency, and I agree totally that it is the energy we do not use which is important. As a country, we probably need to do more on demand management. There is a manifesto commitment to insulate or improve 1 million homes in terms of their energy efficiency, and we are certainly committed to that. The smart meter programme, which I was looking at this morning, will help deliver energy reductions, as will our work on boilers and cars. All this continues.
Lord Stern of Brentford (CB)
Does the noble Lord agree that the UK delegation, including himself and the Secretary of State, played a strong role in what happened in Paris? They were everywhere and the UK’s position was largely respected. I was fortunate enough to be badged with the French delegation, and they were enormously appreciative of the work done by the UK. That appreciation is founded on two things. One is respect for our climate legislation and the great institutional strength that that gives to this country in its clear commitment to bring down emissions. I hope that the noble Lord will also agree that it is founded on our commitment to 0.7% of GDP being spent on overseas aid. That puts us in a stronger position than some other countries and allows us to contribute very powerfully.
I hope that the noble Lord will agree that the private sector contribution to the Paris meeting was very strong, and that private sector leadership is the growth story of the future in terms of the transition to a low carbon economy, as it will be at the top of the agenda at the World Economic Forum to be held in Davos in January. Again, I thank the noble Lord for the part he has personally played in that outcome.
Lord Bourne of Aberystwyth
I thank the noble Lord, Lord Stern, for his kind words, and I am certainly happy to accept the compliment. I welcome very much the role he has played. Indeed, when I last saw him on the television, he was featured not only with the French delegation but also with the former Vice-President of the United States, Al Gore. The noble Lord has done seminal work which demonstrates that we can have falling emissions and economic growth, and I think that that is now widely accepted. It was an absolutely prescient report.
It is true that the position we play in relation to overseas aid is crucial. It gives us a powerful means of talking to many other countries and seeking to be as helpful as possible. I mentioned earlier the small island developing states and the particular challenges they face. The legal framework we work within is also important. Finally, the last point he made about private sector leadership is vitally important. The Governor of the Bank of England spoke powerfully at the Paris conference, which is not something that has happened previously. The private sector demonstrated leadership, particularly when Michael Bloomberg, Paul Polman and many others said that this is an agreement which they warmly welcome. It is not just about non-governmental organisations and politicians, it is very much about the business world as well. Again, I thank the noble Lord for the role he played at the conference, which I know was considerable.
The Lord Bishop of Salisbury
My Lords, I, too, congratulate the Minister on the achievements in Paris and the part that the UK Government played. The faith communities organised, among those from the wider public sphere, to gather in Paris. Forty-four pilgrims walked from London; seven walked from the Danish-German border; and 22 cycled from Copenhagen. As they travelled on the journey to Paris, they gathered with them the support of the communities through which they travelled and in which meetings were held. This culminated last week with the presentation of a petition, with signatures from 1.83 million people, to Christiana Figueres and President Hollande by 20 of us in the faith communities. This is a deal that many people wanted. Ban Ki-moon, Secretary-General of the UN, said that it was the most complex and largest talks he had ever been part of. The sense of achievement is therefore very great in having pulled off the Paris agreement. The UK’s contribution through climate finance was particularly significant.
However, over these last months, the Government have given mixed signals about the commitment to renewable energy. Therefore, there is a question about how the Paris agreement will be implemented domestically. That which was hard fought and hard won now needs to be hard wired. I would like to ask the Minister how, over these next few months, he sees the Government acting across the areas of public policy in order to make sure that this agreement is hard wired into all our thinking and acting across the whole area, not just within DECC and those involved in the environment and climate change. What steps will be taken to ratchet up the UK’s ambition in the way that the Paris agreement envisages so that we become more ambitious about what we are trying to achieve?
Lord Bourne of Aberystwyth
I thank the right reverend Prelate very much for his kind words and note, in particular, the lead that he has given through the Lambeth declaration and the fact that that pulled together people of many faiths. There was also a massive role of the Muslim climate group in supporting this. The participation of faith in all this, not least from His Holiness the Pope, was significant. I thank him also for what he said about climate finance. The contribution that this was able to make to the debate, and speaking to people, certainly was significant. Obviously, it is important for developing countries, particularly the most vulnerable countries, because there are degrees, as we are all aware, of poverty. Some small island states in particular need an awful lot of assistance on adaptation as well as mitigation.
The right reverend Prelate asked about the domestic agenda. Again, I refer him to what I said previously about falling costs, which is certainly true. The costs, particularly of solar, are spiralling down very quickly. Given the very clear signal that has been sent out worldwide, we can expect that to continue. The Paris agreement is significant in many respects. It is significant that the world has come together in the positive way in which it did but, on the specific, it is very important that it signals the end of the carbon economy. It is only a question of when. That message going out worldwide to business and being welcomed by business will mean that costs fall.
What are we doing within DECC? First, many DECC officials are taking a little bit of a break, having been up around the clock for the past couple of weeks. That said, work is already going on to see how this is delivered but, of course, the work had started before. We are already looking across government at what we need to do on cars and housing to meet our carbon targets. That work will continue but it is important that this is not just a one-nation issue; this is across the whole world. Hence, the importance of the five-year stock takes and the five-year reviews.
Viscount Ridley (Con)
My Lords, I hate to pour cold water on this love-in but perhaps I may remind the Minister that the only thing legally binding on countries which are increasing their emissions in this agreement is that they must produce voluntary plans. Paris therefore represents the end of a 20-year attempt to get agreement to legally binding emissions targets. Will he confirm that this leaves the UK as the only country with a legally binding target on emissions? Will he remember the Chancellor of the Exchequer’s pledge that this country should go no faster in this respect than other countries? Will he therefore consider adjusting our policies to fulfil that pledge in the interests of those working in the industry and those struggling to heat their homes this winter and in future winters?
Lord Bourne of Aberystwyth
My Lords, I am also disappointed that my noble friend has ended the “love-in”, as he calls it. If this is regarded as something that states will just cast away, it is significant that it was such a hard agreement to drive and achieve—if it really was, as he perhaps implies, just a piece of paper and not worth the paper it is written on, why was it so hard an agreement to reach? Only one state stood apart from this process and that is North Korea. I suggest that this is no time for strategic alliances with North Korea. This is a world problem that needs a world solution. The agreement is a step on that road.
Baroness Worthington (Lab)
My Lords, I congratulate the Minister on the role he played in Paris, alongside the right honourable Amber Rudd and her team. I also pay particular tribute to Pete Betts, who was the lead negotiator of the DECC team and, indeed, represented the entire EU in the negotiations. He has been an amazing builder and crafter of consensus on this issue.
It is clear that Paris marks a watershed and a new beginning because it is the first time that 190 countries have said that they are all on the same page and they all will take action on this. The noble Viscount pointed out that this is a different deal, and it is for a reason. It is a fantastic example of catching the exact balance between ambition and flexibility to allow maximum participation. We would have achieved nothing in Paris if we had gone trying a top-down, dictatorial approach to bringing emissions down. It is only by building consensus in the way that Paris did so successfully that we have managed to achieve this deal.
I will touch on one issue relating to the implications of this for the UK and, indeed, for the EU. It cannot be the case that Paris is such a significant moment, yet we say that there is nothing more to be done here and that we are already doing everything that we can. Indeed, the text in Paris is quite clear: all countries that can reduce emissions must do so, including before 2020. My question to the Minister is: will you instruct the Committee on Climate Change to look again at our framework to see whether we can do more? I am certain that we can; we have certainly been overachieving our targets in the first of our budgets, carrying a lot of hot air forward. Let us take that hot air out, increase our ambition and continue to lead. It is only through leadership that we can show the rest of the world that this is possible, as we have been doing to date and continue to do.
Once again, I congratulate everyone involved on achieving such a huge and monumental result, including the noble Lord, Lord Stern, who was one of the great architects of this approach, which has delivered a fantastic result.
Lord Bourne of Aberystwyth
I thank the noble Baroness very much indeed for her typically generous comments and associate myself with what she said relating to the noble Lord, Lord Stern, and the entire team in DECC. She rightly mentioned Pete Betts. I spoke to him today; he is up and fighting the case, even given the massive involvement that he had. I also mention in that context Ben Lyon, who was also a key negotiator. They and the entire team worked incredibly hard.
The noble Baroness is right that this process at Paris represents a bottom-up approach, rather than the top-down one that we had in Kyoto. I therefore think that it is entirely the right approach. It is not right to say that this is not legally binding. Finance is obviously connected with performance. This is a treaty that we have every reason to believe will be adhered to. As she says, it is important that the United Kingdom steps up to the plate. We have provided strong leadership and we will continue to do so. We in the department are looking at ways to reduce demand on electricity, as we always do: we are looking at the cars issue across government, at what we can do through DCLG and so on.
The noble Baroness mentioned the Committee on Climate Change. My noble friend Lord Deben is in his place. As I understand it, the committee previously wrote to us and indicated that if it needed to reassess in the light of Paris it would do so and come back to us in the new year. I presume that that is still the position. Again, I pay tribute to what he did out in Paris because I know that he was also very strong there in supporting what was happening.
Lord Deben (Con)
Would my noble friend accept that the Paris result was remarkable and unprecedented, and that those who would cast doubt upon it are only undermining the way private industries know that they will have to change if they are to meet the world in which they will have to compete? The Climate Change Committee will give advice to the Government on what changes need to be made but, in the mean time, I hope my noble friend will accept that the fifth carbon budget is a crucial part of this continuum and that we need to have legislation on it as rapidly as possible. Does he also accept that he has promised that we will look again at the way we insulate homes and deal with energy efficiency? Will he also make sure that it is part of the policy that no new houses are built which have to be retrofitted very soon because they do not meet the sensible requirements of the Paris commitment?
The Minister ought to be congratulating himself. It is not a love-in to say that Britain has played a very important part in an unprecedented decision. The whole world has said that we know we have to act and those who refuse to know are undermining the future of our children and grandchildren. I say that particularly to those of my colleagues who continually undermine the duty we have.
Lord Bourne of Aberystwyth
My Lords, nobody should doubt the commitment of the Prime Minister and the Government to this agreement. The Prime Minister was out there at the start, clearly underlining support and the importance of protecting the small island developing states. He has welcomed this strong agreement. There is no shame attached to this country giving a lead on these issues, as we have on many others over the ages: we should be proud of it. I note what the noble Lord said about the fifth carbon budget. We will be looking at that and responding to it in the first half of 2016, according to the deadline which is set out. There was a commitment to insulation in the manifesto and there are ongoing developments in energy efficiency. The smart meter programme, which is coming on and will be delivered in totality by 2020, will be a strong driver of that policy.
Baroness Liddell of Coatdyke (Lab)
My Lords, this is a very considerable achievement. I have been haunted by the image of being at a meeting of the Pacific Island forum and a Minister having to leave suddenly, her parents’ house having been inundated because sea levels have risen much more rapidly than anticipated. The small islands in the Pacific have been on edge about the consequences. The Minister referred to the need for investment. What measures are the Government prepared to take to restore the confidence of the investment community in this country? Just three or four weeks ago, a major investment in carbon capture and storage was pulled out from under their feet. A member of a board which has proper respect for due governance and risk analysis would have to take into account the uncertainty there is now about energy investment decisions. What measures are the Government prepared to take to restore that confidence?
Lord Bourne of Aberystwyth
My Lords, the noble Baroness is quite right about the importance of the small islands in the Pacific and elsewhere, such as the Seychelles and the Maldives. It was brought home graphically to me when I met representatives from Tuvalu in the House of Lords during the summer. They said that two degrees was not going to be enough to save them from total obliteration. Although there is a measure of self-interest, it is to the credit of the world that there was a sense of international responsibility for these issues when they came up in Paris.
On the investment issues which the noble Baroness rightly raised, £122 billion is spent annually in the UK on the low carbon economy. It is of extreme and growing significance and we are well aware of it. I repeat that this global agreement has been much welcomed. It gives certainty and sense of direction worldwide, not just in the UK. We have significant investments in the UK which have taken heart from the Government’s decision. An example is Siemens in relation to offshore wind. The point is well made that economic leaders need certainty. I would not disagree with that and it will, obviously, inform our policy.
Lord Lawson of Blaby (Con)
My Lords, the problem is that the Statement that my noble friend read out bears only the most tenuous relationship to what is actually happening in the real world. Is he not aware, for example, that back in the real world India has just announced plans to double its coal production by 2020? Is he not aware that in the real world, more than 2,500 coal-fired power stations are under construction, particularly in India and China but elsewhere around the world? Whether he wants to see decarbonisation or not, does he agree that, bearing in mind the effect on fuel prices, which affect fuel poverty and the competitiveness of British industry—one thinks of the recent closures in the steel industry in this country—it makes no sense whatever for us to decarbonise faster than the rest of the world?
Lord Bourne of Aberystwyth
My Lords, I am very well aware of the massive deployment of coal. That is one reason why the world needed to come together to see how it will address that issue. It is also true to say that in both India and China there is massive deployment of renewables. I think that the deployment of solar is about to overtake coal in India, so I recognise the issue. That is why we need to address it. I hope the noble Lord agrees that we do need to address it; I was not sure whether that was the inference of his question. I understand the particular problems with steel, for example, that he mentioned, but this issue is not related simply to energy but also to overproduction. I also recognise that every country has to protect its own patch and its own interests. As I said, there is an element of self-interest in different countries coming to this agreement in different ways, but there is a real sense of international responsibility and a real sense that if we had not acted in the way we did in Paris, we would face very serious problems in the future. There are still challenges but this was a very important milestone, and a very important milestone for the United Kingdom in the role it played.
Enterprise Bill [HL]
Lord Taylor of Holbeach (Con)
My Lords, I have it in command from Her Majesty the Queen to acquaint the House that Her Majesty, having been informed of the purport of the Enterprise Bill, has consented to place her interests, so far as they are affected by the Bill, at the disposal of Parliament for the purposes of the Bill.
Lord Berkeley (Lab)
My Lords, before the noble Baroness, Lady Neville-Rolfe, moves Amendment 1, will she, or the Chief Whip, explain in more detail what prerogatives and interests the Queen has put at the disposal of Parliament for the purposes of this Bill? The statement that has been made does not come with every Bill, but could the Queen have just bought some pubs, which formed part of the discussions we had on Clauses 32 and 33, or will the non-domestic rates be affected? It would be very helpful to the House if we knew what interests Her Majesty was putting at the disposal of the House, and whether they are her public interests or her private ones.
Lord Taylor of Holbeach
My Lords, the notice I read is a courtesy which Her Majesty extends to the House before we consider the Third Reading of a Bill. It is not normal to discuss in detail what the interests are. They arise from the fact that the Bill addresses the rating of property, and Her Majesty is the owner of such property. In that respect, she has placed her prerogative at the disposal of the House.
Amendment 1
Baroness Neville-Rolfe
“Additional time limit for actions for damages for late payment of insurance claims
After section 5 of the Limitation Act 1980 insert—“5A Additional time limit for actions for damages for late payment of insurance claims
(1) An action in respect of breach of the term implied into a contract of insurance by section 13A of the Insurance Act 2015 (late payment of claims) may not be brought after the expiration of one year from the date on which the insurer has paid all the sums referred to in subsection (1) of that section.
(2) Any payment which extinguishes an insurer’s liability to pay a sum referred to in section 13A of the Insurance Act 2015 is to be treated for the purposes of this section as payment of that sum.””
The Parliamentary Under-Secretary of State, Department for Business, Innovation and Skills and Department for Culture, Media and Sport (Baroness Neville-Rolfe) (Con)
My Lords, Clauses 22 and 23 bring in reforms to address late payment in the insurance sector, which we believe to be overdue. The overarching policy objective of these provisions is to provide a strong incentive for insurers to pay on time. It is hoped that the provisions will speed up settlement of insurance claims generally, with day-to-day benefits for policyholders.
Amendment 1 affects the limitation period in which a policyholder must bring any claim for late payment of an insurance claim. It addresses concerns expressed on Report that the late payment provisions would force insurers to keep open their books and hold reserves in respect of possible late payment claims for an uncertain length of time, potentially impacting on policyholders through premiums. We have now had the opportunity to consider the policy arguments put forward by the noble Earl, Lord Kinnoull, and my noble friend Lord Flight, and to prepare the amendments needed to make a targeted change to the limitation period for late payment claims. The Government consider that these produce a better balance of policyholder and insurer interests. Due to the volume of claims which insurers deal with, and the capital requirements to which they are subject, insurers have a rather unique need for certainty in knowing when they have satisfied all their liabilities in respect of a certain claim.
The amendment adds a new provision to the Limitation Act 1980, which applies in England and Wales. It means that a policyholder must bring any late payment claim within one year of the insurer having paid all sums due in respect of the initial insurance claim. This may include sums paid under a binding settlement contract between the insurer and the policyholder, or paid as a result of a court award against the insurer. Until the underlying insurance claim has been paid, the usual limitation period of six years from the breach of contract would continue to apply.
It is reasonable to expect a policyholder to bring a claim for late payment within a year of receiving payment of the insurance claim, so the amendment does not prejudice them unduly. It also has the potential to protect the vast majority of policyholders, who will never need to bring a late payment claim, from any premium increases that may result as a consequence of insurers’ increased costs. Amendment 2 provides for the commencement of this amendment. I beg to move Amendment 1.
Baroness Hayter of Kentish Town (Lab)
My Lords, I want to take a moment to say that we welcome this clause. We always thought it was important and I thank the Minister for facilitating the meeting that we had with her and officials, and with the Law Commission, which has given careful thought to this—as have we. In fact, we rather hope that the 12-month limit might even help get some of those payments made rapidly, so we are very happy with this amendment and give it our full support.
Baroness Neville-Rolfe
My Lords, I thank the noble Baroness for her support. I trust that the amendment will receive the same support when the Bill proceeds to the other place in its amended form.
Baroness Neville-Rolfe
Baroness Neville-Rolfe
“( ) section 28 (UK Government Investments Limited);( ) section 30 (UK Green Investment Bank: transitional provision);”
Baroness Neville-Rolfe
My Lords, Clause 38 sets the territorial extent of the provisions in the Bill. This amendment makes minor and technical changes to the clause to make clear that the territorial extent of the clauses relating to UK Government Investments Ltd and the transitional provision in respect of the UK’s Green Investment Bank is UK-wide, and to ensure consistency in the drafting of the clause. The effect of the clause is unchanged.
I should clarify that although I mentioned on Report some possible amendments on pensions provision for Small Business Commissioner staff, on reflection, the Government consider that no amendments are needed at this point. I can also confirm that I have written to noble Lords on the issues raised on Report on which I promised further information, and have placed a copy of those letters in the House Library. I beg to move.
Baroness Neville-Rolfe
My Lords, I put on record my thanks to all those who supported the rapid passage of the Bill through our House. I begin by thanking the Lord Speaker and all Deputy Speakers, as well as the clerks, the doorkeepers and our skilful reporters in Hansard. I thank the hard-working members of the Bill team, helped by our able apprentice, and the officials from the four departments and from the Law Commission who assisted our debates.
The Bill covers a lot of ground. We have jointly crossed a varied and complex landscape—some parts verdant and others rather rocky. Our travels have taken us from the Small Business Commissioner, via the Primary Authority and the Green Investment Bank, to the exit payment cap. Thanks to the noble Lord, Lord Whitty, we even ventured on to the cricket field, and although I was rather disappointed with the noble Lord’s assessment of my batting, I am holding on to the fact that he credited me with a strong defensive game.
I thank all noble Lords for their contributions. We have heard a range of expert voices from the opposition Benches. I am grateful particularly to the noble Lord, Lord Mendelsohn, and to the noble Lord, Lord Stevenson, who I am pleased to see looking so well again. I am grateful to the noble Baroness, Lady Hayter, as well as the noble Lords, Lord Stoneham and Lord Teverson, and the noble Baronesses, Lady Burt and Lady Sharp, as well as the noble Earl, Lord Lytton. I thank them all for their always constructive—and always challenging—approach and for working with me and my officials outside the Chamber. I thank the noble Lords, Lord Smith and Lord Curry, who gave us the invaluable benefit of their experience in chairing the Green Investment Bank and the Better Regulation Executive respectively. It is always good to have people who are engaged in matters contributing in the House.
Finally, I thank my noble friends Lord Younger, Lord Gardiner and Lord Sherbourne, who have so expertly assisted me at the Dispatch Box, as well as my many noble friends who have supported the Bill from the government Benches, especially my noble friends Lady Wheatcroft, Lord Hodgson, Lord Borwick, Lady Brady, Lady Harding, Lady Noakes, Lord Leigh, Lord Flight, Lord Cope and Lord Baker—a cornucopia of talent. I thank all your Lordships.
Lord Mendelsohn (Lab)
My Lords, I also place on record our thanks to all noble Lords for their contributions. The Bill that now passes to another place is certainly a better Bill than the one that arrived, which reflects the role of your Lordships’ House and the constructive discussions that we have had with the Government and others. On behalf of these Benches, I thank the Bill team for its hard work and its readiness to engage in detailed discussion. I thank in particular a member of the small business team, who made a welcome return to finally sort out a few issues that we had with pubs. Our Benches have been very ably supported by the quite outstanding Nicola Jayawickreme, and I put on record my thanks to her.
Our debates have certainly been wide ranging, covering many detailed issues. Of course on our Benches, my formidable noble friends Lord Stevenson and Lady Hayter have made quite outstanding contributions and taught me everything that I know. It has been exceptionally helpful to have many colleagues from outside add some quite outstanding contributions and raise issues which have helped our discussions—including my noble friends Lady Donaghy, Lord Snape, Lord Whitty and Lord Wills. I also pay tribute to the noble Lords, Lord Stoneham and Lord Teverson, and the noble Baroness, Lady Burt, on the Liberal Democrat Benches. We found a very good way of working with them and with the Government to improve the Bill in relation to a number of measures.
Across the House, the noble Earl, Lord Lindsay, has always been an expert on regulation; the noble Earl, Lord Lytton, made some outstanding contributions on non-domestic rates; the noble Lord, Lord Aberdare, raised retentions very ably; the noble Lord, Lord Low, dealt with public sector exit payments and matters relating to whistleblowing. Many other noble Lords contributed, too. I place on record my deep thanks to the noble Lord, Lord Hodgson, for at least agreeing with me once during the course of our discussions.
Finally, I pay tribute to and thank the noble Baroness, Lady Neville-Rolfe. It is always a pleasure to engage constructively with her. She is someone with whom you can always find at least some ground to work with, even when her hands are tied firmly behind her back by those in the Treasury and elsewhere. She is extremely inventive and courteous, and we thank her for the way in which she has handled this measure.
Lord Stoneham of Droxford (LD)
My Lords, I do not wish to detain the House, but I must join in the thanks to those on the Bill team for their patience, particularly on the Green Investment Bank, and all colleagues who have taken part on the Bill. I also join in thanking the Minister for her understanding, diligence, very good communications and patience throughout our proceedings.
Lord O'Neill of Clackmannan (Lab)
I thank the noble Baroness for not putting something in the Bill. At one stage, the noble Lord, Lord Aberdare, and I supported an amendment concerning the issue of retention and the means of dealing with it. She told us that, if it were withdrawn, she would undertake to establish a review. The manner in which the review has been set up gives us great confidence that it will be conducted in a rigorous and fair way, and we look forward to it proceeding in due course. I thank the noble Baroness not for putting something in the Bill, but for giving us what I hope will be an adequate substitute as a means to address one of the most vexed issues of payment. It was not covered by the Bill, but will now be within sight of being properly and speedily remedied—many years too late, sadly, but now ready to be dealt with in an effective manner.
Lord Wills (Lab)
My Lords, my contribution to the Bill was restricted to its very end and the clauses relating to public sector exit payments and what are, I hope, the unintended consequences of protection for whistleblowers. Throughout the discussion of the clauses—and, indeed, of the Bill—the Minister demonstrated her characteristically firm grasp of the issues, constructive approach to the amendments and courteous and considered approach to your Lordships’ House. I am grateful to her and all her officials for the meetings and conversations that we have had on my amendments, and congratulate them on shepherding the Bill successfully to this stage.
Commanding, constructive, courteous and considerate the Minister may be, but I fear that she is not convinced by the arguments that I and others have put forward for the need to improve the legislation better to protect whistleblowers. I fear that the public and Ministers will come in time to regret that. It is common ground that the public interest is best served by creating an environment which encourages genuine whistleblowers to come forward—and to do so in a timely manner. Such whistleblowers often take considerable risks with their careers and livelihoods to come forward in that way. It is in the public interest to provide robust legal protection for those courageous individuals, and uncapped damages are an important part of such protection, because they reassure whistleblowers that they will not be bereft of adequate means to support themselves and their families if they make a disclosure in the public interest.
We did not table an amendment at this stage because we know that the Government believe that regulations will offer sufficient protection to whistleblowers—but that this should, in some way not yet clear, be restricted by the need to protect the public purse from claims made on it by those falsely claiming the protection of public interest disclosures. The Government’s approach appears to be that whistleblowers will not be able to breach the cap unless they can demonstrate that they have made disclosures genuinely in the public interest, and the Treasury will be the judge and jury of that.
How many of those considering making disclosures in the public interest will feel reassured that their ability to support their families will be protected by a judgment by the Treasury that they deserve more money? How many Secretaries of State would be reassured by a plea to trust the Treasury that it will be all right on the night, they need not worry about their department’s budget, because if the Treasury judges, in time, that their case is meritorious, they will, in the end, get the money they need? How many have been reassured by that prospect? Paying out as little money as it possibly can get away with is what the Treasury does, and relying on a judgment by the Treasury or any Minister after a whistleblower has already risked their career and livelihood to make a public interest disclosure is never going to be reassuring to someone taking such risks. Daniel Kahneman, the Nobel laureate, once said:
“To be useful, your beliefs should be constrained by the logic of probability”.
The probability in this case is that, in the foreseeable future, there will be terrible abuses of power and catastrophic cases of maladministration and corruption, just as there have always been in the past, and that these could all have been prevented or at least mitigated, as many could have been in the past. Hillsborough and the abuse of MPs’ expenses, as well as far too many cases of child abuse and failures in the NHS, for example, all bear witness to that.
The public need these courageous individuals to reveal wrongdoing by their employers, in the public interest, and the Government need to persuade them that they are going to be so protected. The Government could have taken the opportunity given by this Bill to provide better protection for such courageous whistleblowers. Instead, they have weakened it through the confusion we talked about in Committee and on Report about how the public sector exit payments cap will apply to whistleblowers. There needs to be greater clarity, and the burden of proof should be reversed so that it is clear that all public interest disclosures will merit breaching the cap on public sector exit payments, unless it can be shown that disclosures were not in the public interest.
The Minister and her officials have kindly agreed to meet me, my noble friend Lady Hayter and the noble Lord, Lord Low, whom I also regard as my noble friend, to discuss these issues. I hope that they can provide us with greater reassurance then. Otherwise, I fear that when the next scandal happens over a failure to protect the public—as, sadly, it is bound to do—and the resulting inquiry finds that inadequate protection for whistleblowers is part of the reason for that failure, as it probably will, we may all regret that we did not seize this opportunity to do more to protect whistleblowers.
Bank of England and Financial Services Bill [HL]
(8 years, 4 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
19:17 - Division on Amendment 20 - Ayes: 198 / Noes: 200 - Amendment 20 disagreed.
Lord Bridges of Headley
“( ) In section 3C (reviews) after subsection (1) insert—
“(1A) Where they consider that to do so would contribute to the discharge by the court of directors of any of its oversight functions, the non-executive directors of the Bank (or a majority of them) may arrange—
(a) for a review to be conducted under this section in relation to any matter by a person appointed by those directors, and(b) for the person conducting the review to make one or more reports to the court of directors.””
The Parliamentary Secretary, Cabinet Office (Lord Bridges of Headley) (Con)
My Lords, I am grateful for the discussions we have had on Bank governance to date. In this group, I would like to bring forward three amendments that respond to those debates: first, to ensure that the non-executives on the court can always initiate performance reviews; secondly, to prevent the court from delegating oversight functions to a sub-set of its members; and, thirdly, to provide clarity on responsibility for the financial stability strategy.
The noble Baroness, Lady Kramer, and the noble Lords, Lord Sharkey, Lord Tunnicliffe, and Lord Eatwell, have raised concerns that the transfer of the oversight functions to the court could unintentionally weaken the non-executive majority. Noble Lords have argued that a majority of non-executives might be blocked from initiating a review if the executive was united in opposition and enlisted one or two non-executives to their cause. The first amendment laid by the Government addresses these concerns. The government amendment to Clause 3 ensures that a majority of non-execs can always initiate performance reviews without needing to secure the agreement of a majority of the whole court. If just four non-executive directors want a review, they will be able to initiate it. This will reinforce oversight of the Bank’s activities and provide additional protection against groupthink. The initiators of a review would determine who should carry it out. This could be someone external, or internal, including the Bank’s new Independent Evaluation Office.
At this point, it is worth pointing out a related change that the Bill makes. The 2012 Act required that:
“If the person to be appointed to conduct a performance review is an officer or employee of the Bank, the appointment requires the consent of the Governor of the Bank”.
The Bill removes that condition, so that a majority of the court or a majority of non-executives will be able to appoint an officer or employee of the Bank without needing to secure the Governor’s consent.
Lord Eatwell
Lord Eatwell (Non-Afl)
My Lords, this amendment seeks to provide the Treasury Select Committee of another place with the ability to stimulate the oversight function of the Court of the Bank of England. It may be helpful to provide some context for this proposal. The measures in the Bill, in so far as they refer to the Bank of England, return the regulatory scope and powers of the Bank to roughly the same position that they were in in 1997. From 1997 onwards there was, first, the transfer of many, though not all, of the Bank’s regulatory powers to the FSA, then the abolition of the FSA and the transfer of prudential regulation to the PRA, and now the subsidiary status of the PRA is to be abolished and its activities fully reincorporated within the Bank, so we have come full circle. After major institutional reforms, we are back where we started, with all the powers of prudential regulation being exercised by the Bank. Conduct of business regulation, amalgamated in the FSA from various sources, now resides with the FCA, but it should be noted that few of these powers were originally exercised by the Bank of England.
It is worth recalling that the Bank of England that we began with, prior to the creation of the FSA, was not a successful regulator. The Bank failed in the case of the Johnson Matthey bank and over BCCI, and so glaring was its failure with respect to Barings that the then Board of Banking Supervision commented acerbically that the Bank of England should try to understand the institutions that it purports to regulate. Regulation was taken away from the Bank because it had failed as a regulator. Then, of course, the new tripartite regulatory structuring of the FSA, the Bank and the Treasury failed dramatically in the financial crisis of 2007-08, so the FSA was abolished. At least the PRA can hold its head up and declare that its position as an independent subsidiary is being abolished in this merry-go-round not because it has failed but because of a desire to restore the unitary power of the Bank of England. It is neater that way.
What this tale of circular institutional reform should teach us is that there is no specific institutional structure that can guarantee to deliver regulatory competence. The all-powerful Bank that we are now recreating has proved in the past to be a regulatory failure, while the tripartite structure of the FSA, the Bank and the Treasury failed even more spectacularly. Given that institutional reform will not be a panacea, there is a powerful case for thorough parliamentary scrutiny to at least attempt to identify the failings when they occur, as we can be sure that they will. Moreover, I remind noble Lords of the words of the Treasury Select Committee of another place with regard to the original proposal that a supervisory board be established at the Bank. The committee said:
“The Bank is a democratically accountable institution, and it is inevitable that Parliament will wish to express views and, on occasion, concerns about its decisions. Our recommendation that the new Supervisory Board have the authority to conduct retrospective reviews of the … prudential performance of the Bank, should, if operated successfully, provide the tools for proper scrutiny”.
In Committee I asked the Minister if he agreed with the proposition that the Bank should be a democratically accountable institution. He failed to reply. I will happily give way now if he wishes to comment. Apparently he does not.
Therefore, the Treasury Select Committee argued, correctly, that proper parliamentary scrutiny depends on internal reviews of the Bank, not just on the external inquiries of parliamentary committees. Internal review provides Parliament with the “tools for proper scrutiny”. The reason is obvious. The court that as a consequence of the Bill will be invested with the oversight function has full information about the operations and policies of the Bank—a level of information that even the most assiduous Treasury Select Committee could never have. Indeed, the court has information which is not, and sometimes should not be, in the public domain.
My amendment would allow the Treasury Select Committee of another place to request that the court exercise its oversight function. Note, as the Minister said, that the court is not compelled to comply. The wording of the noble Lord’s amendment, to which my amendment refers, states that the non-executive members of the court “may”—not must—“arrange for a review”.
Let us suppose that the Treasury Select Committee’s request stimulates a review. What happens then? First, as the noble Lord’s amendment requires, a report or reports will be made to the court. To discover what happens next we turn to Sections 3C, 3D and 3E of the Bank of England Act 1998, as amended. There we find that the Bank must give the Treasury a copy of the report and that the report must be published, unless the court of directors decides that publication is not in the public interest. Finally, in exercising its oversight function the court must monitor the response of the Bank—including the court itself—to any recommendations made in a report.
I have detailed the path that any report stimulated by a Treasury Select Committee request might take in order to reassure the House that safeguards are already built into the structure of the legislation before us that will ensure that information which it is not in the public interest to publish at a particular time will indeed not be published. Yet even without publication, a request by the Treasury Select Committee may well stimulate an important investigation that results in valuable internal reform at the Bank.
The government amendment makes a valuable addition to the powers of the non-executive members of the court in the exercise of their oversight function. However, the procedure envisaged by the government amendment is such that investigations can be stimulated only by insiders—not what might be considered proper democratic accountability. My amendment will at least provide a pathway along which proper democratic accountability may be exercised: not will be, but may be. The Treasury Select Committee will be able to request that the court institute a review. That is just a small increase in democratic accountability but one that may well avert future regulatory failings. I beg to move.
Lord Turnbull (CB)
My Lords, I am somewhat puzzled by the amendment, because it seems to be a power which the Treasury Select Committee already has and already exercises. I will give noble Lords three examples. It called for a report from the Bank into Northern Rock, another one into RBS, and then—with some delay, appearing only three days ago—finally into HBOS. Therefore the Treasury Select Committee, led by the people who lead it now, does not need this power. It is perfectly capable of forcing the Bank to undertake a review and to reveal the contents to that committee.
Baroness Kramer (LD)
My Lords, I have no wish to detain the House. The Government have listened to the concerns that we raised at previous stages of the Bill and in the discussions that the Minister generously agreed to. The amendment that the Government have brought forward does not go as far as we would like but we feel that it addresses the most essential issue, which is the independence of the non-executive directors of the court, and that it provides a mechanism so that they can resist capture by officials of the court. For that reason, we are satisfied.
Baroness Wheatcroft (Con)
My Lords, I echo the words of the noble Baroness, Lady Kramer. It seems that the Government have now moved to strengthen the role of the non-executives. That four of them should be able to call for a review answers many of the queries that have been raised. I completely agree with the noble Lord, Lord Turnbull, that nobody in the past accused the Treasury Select Committee of being a toothless body.
Lord Myners (CB)
My Lords, I declare an interest as a former member of the Court of the Bank of England. I support the amendment proposed by the Minister and I do not support the amendment to it proposed by the noble Lord, Lord Eatwell, largely for the reasons identified by my noble friend Lord Turnbull.
The functionality of the court has improved markedly since I was a member—no doubt the two are directly related. There was a dominance of the court by the executive, and the non-executives were, quite frankly, confused about their role. They did not manage to organise themselves in a manner that effectively challenged the Chancellor. I and one or two members of the court became so concerned that we felt the need to report that the court was not working effectively—but we then struggled to find out to whom we should report it. I remember going to see the Permanent Secretary to the Treasury and then the Chancellor of the Exchequer and saying, “The Bank of England is not working well because it is too detached from the real world of what is happening in banking, and it acts as the sole voice of one person—namely, the governor”. I believe that it is now a far more democratic institution.
However, I struggle to understand why this power requires to be reflected in law. I would have thought that the effective functioning of a board of directors, on which we have based the court, would allow the court to establish a sub-committee to do anything that it chose to do and that it did not need specific authorisation in law to do so. If the Government’s view is that that power does not exist for the court, we need to be very clear that the Government are telling us that the court should in no circumstances be considered to be on a par with the board of directors of a company in terms of holding the executives to account.
Lord Davies of Oldham (Lab)
My Lords, I am grateful to the Minister for his introduction to this debate. He will not have been at all surprised that one or two penetrating questions have been put forward. I put on the record the assiduous way in which he set out to make changes to the Bill in response to our debates at Second Reading and in Committee. In doing so, he greatly assisted those of us who were able to negotiate with him to see the advantages that could be obtained by moving some way back to the future, as it were, and re-establishing the Bank as it was.
I think that lessons have been learned over recent years. My noble friend will appreciate that the original Bill that came before this House effectively ended the oversight committee and reduced the power of the non-executive directors. The Minister has taken steps to respond to the great concern expressed on all sides of the House on these issues and has brought the non-executives into a position of considerable significance, not least in determining the remuneration of executives’ pay, in which it is important that the non-executives should be in a substantial majority. Also, they have the right to carry out the oversight functions on which we pin such a great deal of emphasis. Therefore, we are grateful to the Minister for the extent to which he has moved.
I am grateful to my noble friend Lord Eatwell for his insightful contribution. He will know that this is only the first shot at this Bill as far as Parliament is concerned in this noble House. But it will certainly be taken on board in the other place, and it may be thought that it is the other place that ought to deliberate quite significantly on the role and position of the Treasury Select Committee in relationship to the Bank of England. I do not think any of us have thought that either the chairman of the Treasury Select Committee or the committee itself have been backward in coming forward when issues have presented themselves that needed inquiry. Therefore, I think that my noble friend Lord Eatwell can derive from this debate some satisfaction from the fact that there will be an opportunity for that to be debated further.
The House has concentrated on the question of the role of the non-executives. I am grateful to the Minister for having responded to those anxieties and presented amendments that have, to a very large extent, brought the situation back to a position of some significance. However, it was the case that, at Second Reading in particular, there were very great anxieties about the extent to which the government proposals significantly reduced the power of the non-executives, and that we were faced with a Bank in which their role was nothing like the role that they had played in the more recent past. I think that we have, through these amendments, met the wishes of the House. I am grateful to the Minister for having listened to the House and to several representations that we have been able to make. I am also grateful that he has been able to meet significant figures from the Bank—the chairman of the court and the chief executive—to understand the nature of the issues before us. So these amendments are to be commended and we support them.
Lord Bridges of Headley
I begin by thanking the noble Lord, Lord Davies, for his kind words. Let me reciprocate by saying that it has been a pleasure having discussions with him, and with the noble Baroness, Lady Kramer. I hope that this constructive spirit is retained all afternoon.
The noble Lord, Lord Myners, made a good point: why are we bothering and why do we need to do this? The point that the noble Lord, Lord Davies, made answered that in large part: it is because there was concern. But specifically, the court’s powers of delegation are limited by paragraph 11 of Schedule 1, and it may not delegate duties and powers that are expressly imposed on the court in legislation unless it has express permission to do so.
This has been a good debate, and I return briefly to the points made by the noble Lord, Lord Eatwell. He asserted that we have gone back to 1997. I would dispute that that is the case. The Government have given the Bank the tools and powers that it needs to deliver its financial stability mandate. In particular, the Bank is now the statutory resolution authority with primary operational responsibility for financial crisis management. On top of that, we have created the FPC as a statutory committee of the Bank with the responsibility for monitoring and mitigating systemic risks for financial stability.
As to why prudential regulations should reside with the Bank, one of the key weaknesses of the tripartite system was a failure of co-ordination between those responsible for overseeing the financial system. We do not want to return to that. As the Chancellor said during the passage of the 2012 Financial Services Act, the Bank of England is the natural home for the microprudential, macroprudential and monetary policy functions because the interconnections are so great between these three critical functions. Having the PRA as part of the Bank also reduces underlap that could be harmful in the event of a crisis.
I turn to the issue of democratic accountability of the Bank. Since 2012, a number of measures have been introduced that have significantly enhanced the transparency of the Bank, and I will briefly recount some of these. For example, the court is now required to publish minutes of every meeting within six weeks. It has also voluntarily published historical records of court minutes, including those during the financial crisis, and, through this, Parliament and the public now have greater insight into the governance of the Bank and the key decisions made. Similarly, the Bank has introduced measures to enhance the transparency of the Monetary Policy Committee following the recommendations of the Warsh review. Clearly, therefore, the Bank is a more transparent institution than it was in 2012. However, there obviously remains room for further improvements. This Bill builds on those reforms through changes to the Bank’s governance, to its policy committees and to its accountability. However, as I argued previously—and as the noble Lord, Lord Turnbull, has argued—this amendment is not necessary.
Lord Eatwell
My Lords, I am impressed by the extensive lack of support for this amendment throughout the House. I say in response to what the Minister has said that, of course, the powers have developed and lessons have been learnt since the financial crisis, but I was referring to the recentralisation of powers rather than some of the extra powers that have resulted from the lessons learnt.
The main argument made against my amendment was that the power exists already. If the power exists already, the amendment does no harm—I have not heard anyone express the view that it does. However, the key reason for the need for my amendment was expressed clearly by the noble Lord, Lord Myners, who asked why conditions requiring members of a board to act were in the Bill at all. They are in the Bill because the action has not been present in the past. It is because of this lack of action that Parliament has lost a degree of confidence in relying just on the actions of the court and has decided that, to ensure appropriate transparency and efficiency in the operations of the court, it may be required to do certain things. That is why the Government have put into the Bill measures instructing the court to behave in particular way and why my amendment is there—because the court has not always responded to the requests of the Treasury Select Committee. It has not, for example, responded to repeated requests to publish a detailed review of its own actions during the financial crisis. My amendment, small in terms of changing circumstances though it might be, would have assisted the development of the democratic accountability of the Bank. However, in the circumstances, given the widespread lack of support around the House, I beg leave to withdraw the amendment.
Lord Bridges of Headley
Lord Bridges of Headley
“( ) Paragraph 11 of Schedule 1 to the Bank of England Act 1998 (matters which may be delegated by court of directors) is amended as follows.
( ) In sub-paragraph (2) after “paragraph” insert—
“(a) include duties and powers conferred on the court of directors by section 9A (financial stability strategy), but(b) except as mentioned in paragraph (a),”( ) After sub-paragraph (2) insert—
“(3) The court of directors retains responsibility for a duty or power which it delegates under this paragraph.””
Lord Bridges of Headley
Lord Bridges of Headley
My Lords, I turn to amendments on NAO reviews, which concern Clause 11. One of the objectives of the Bill is to enhance the accountability of the Bank of England, and these clauses, which allow the NAO to conduct value-for-money examinations of the Bank for the first time, are key in that respect.
We have debated these clauses at great length. That is only right, as we set out to define the respective roles of two vital public bodies. I thank those of your Lordships who contributed in Committee and earlier. Although it is invidious to name names, I thank in particular the noble Lords, Lord Bichard, Lord McFall, Lord Davies, Lord Higgins and Lord Young, and the noble Baronesses, Lady Noakes and Lady Kramer.
Since Committee, officials from the National Audit Office, the Bank of England and the Treasury have been working closely together to reach an agreement on how to address the concerns raised in debate so far.
Lord Higgins (Con)
My Lords, it was clear in the earlier stages of the Bill that there was significant conflict between on the one hand the NAO, feeling that its independence had been jeopardised, and on the other the Bank of England, wishing for greater independence than is enjoyed by other bodies being investigated by the NAO. Clearly a great deal of work has been done behind the scenes and all those concerned are to be congratulated on coming up with a compromise which ought to be satisfactory from both points of view.
I have just two points which I would be grateful if the Minister could clarify. First, is the memorandum of understanding referred to in Amendment 9 going to be published? That would be an advantage. Secondly, in relation to proposed new subsection (2)(d), I am not absolutely clear what happens if in fact there is a dispute which “cannot be resolved”. I am not clear on precisely how the matter would then be resolved.
There is one other point which is not absolutely clear. The NAO was very concerned that it would not be able to publish information it obtains, something which previously has been at the discretion of the NAO. Is that point going to be resolved?
Perhaps I may raise one final point. Under government Amendment 7, a number of things are now specifically mentioned as being things that the examination will not be concerned with. I shall take a specific example; namely, the issue of quantitative easing and how that is being implemented. Will the NAO be able to look into whether it regards the way in which that is being dealt with as satisfactory? But, overall, this is a very satisfactory outcome from what was an extremely difficult and perhaps rather tense situation.
Lord Bichard (CB)
My Lords, in declaring my interest as chairman of the National Audit Office Board I hope that I will not be precluded on this occasion from thanking the Minister for bringing forward the amendments to Clause 11, which I am happy to support. In large part, the amendments deal with the concerns which the NAO had with the original draft, in particular by deleting the Bank’s power of veto over NAO value-for-money studies. As a result, these amendments protect the independence of the NAO and necessarily enhance the accountability of the Bank. I am grateful to the noble Lord and Members across the House who have helped to achieve a very happy outcome.
Lord Young of Cookham (Con)
My Lords, I also welcome the progress that my noble friend has made since we discussed this matter on 9 November, when concern was expressed that we had not got the interface between these two independent institutions in the right place. I was delighted to hear that peace has broken out between these two institutions. My noble friend said that the memorandum of understanding would be published in due course. My noble friend Lord Higgins pressed him a little further. Will it be available during the passage of the Bill, which started in this House and will go to another place, because I am sure that it would be of interest? Finally, does one really need proposed new paragraph (d) in Amendment 9 in the memorandum of understanding? If under proposed new paragraph (c) a procedure has been established,
“for resolving in a timely fashion any dispute”,
why does one need paragraph (d), which asks for a procedure where the dispute has not been resolved?
Baroness Kramer
My Lords, I will not detain the House very long. The National Audit Office and the Bank of England are crucial institutions. It is absolutely necessary that both are not only independent but perceived to be independent. In earlier stages of this Bill, we asked that those two organisations should be brought together to come to a common understanding and agreement of how we could go forward. That has been achieved and, with that, we are pleased that “peace has broken out”—to quote what has just been said. It was essential that that should be done and I congratulate the Minister on the role that he played in this.
Lord McFall of Alcluith (Lab)
My Lords, I add my thanks to the Minister and others on this issue. I have had a letter from the Comptroller and Auditor-General, who clearly says that the Government listened to many of the concerns at Second Reading and that the threat to his role as Parliament’s auditor has been reduced. That aspect is very important.
The power of veto was one of the first things on which people came to their senses. It was explained to me that the Bank would publish its view when it refused the NAO, to which I said, “Well, it means that it would go before the Treasury Committee, and the NAO would probably go before the Public Accounts Committee”. If the Treasury Committee and the Public Accounts Committee felt that that was not very good, they would probably have a Joint Committee. I think they thought that it was the best idea to drop the power of veto, which was a good outcome.
I accept that the Bank of England’s independence is essential, particularly in the former role I had as chair of the Treasury Committee. That was very important, particularly during the financial crisis. But the democratic accountability element is important. I see this memorandum of understanding not as something set in stone but as something that can adapt to time as we go along. The noble Lord, Lord Higgins, made a point about whether it would be public. I am sure that it has to be public if there is to be credibility. If there is no intention to have it be public, that would be a backwards step on that issue. If it is not going to be public, the Treasury Committee and the Public Accounts Committee need to have sight of this as it goes along. Let us hope that we do not have that second aspect and that the memorandum of understanding is a public document. As the noble Lord, Lord Young, said, it should be here before we finish the passage of the Bill.
Lord Lester of Herne Hill (LD)
My Lords, I have not taken any previous part in the debates on this Bill. I intervene only to explain why I fully support these amendments and the Minister’s statement. Many years ago I represented clients in the Crown Agents inquiry, which was concerned with how millions of pounds came to be lost in an unwise investment in Australia. The Bank of England’s role in that inquiry was important. It turned out that there was no legal adviser within the Bank at all. It seemed to me and many that the amateur system that then prevailed was quite bizarre. I very much welcome the fact that this Bill moves the Bank of England from the dark ages to an enlightened situation.
Lord Myners
My Lords, I also congratulate the Minister and the parties involved on finding a pragmatic and workable solution to a problem identified in earlier discussion in this House. I also echo the point made by the noble Lords, Lord Higgins and Lord McFall. Proposed new Section 7E starts:
“The Bank and the Comptroller must prepare and maintain a memorandum of understanding”.
There is no mention of the word “publication”, yet in proposed new subsection (2)(d) “publication” is used. On the face of it, the absence of “publication” from the beginning of the section is intentional. As such, that surely should be unacceptable. I therefore urge the Minister at some later stage to persuade his colleagues in the other place that “publication” should be included, and to give this House some reassurance now that it is his intention that the memorandum of understanding should be published. Otherwise, the public will not have the confidence that they seek in clarifying this issue.
Baroness Noakes (Con)
My Lords, the Comptroller and Auditor-General and the National Audit Office are in agreement with this, but I would like to clarify the effect of proposed new Section 7E(2)(d). It allows for the publication of views where a matter in dispute cannot be resolved. That implies that there would be no agreement as to whether a particular audit could take place. That allows the Bank of England a backdoor power of veto if the arrangements are such that there is a possibility that even a dispute resolution procedure, as provided for under proposed new paragraph (c), results in there not being agreement. Therefore, is it possible that the Bank could de facto operate a veto?
Lord Davies of Oldham
My Lords, the Opposition are of course glad that peace has broken out. As a token of that peace, I say how much I agree with the question asked by the noble Baroness, Lady Noakes, which I hope the Minister will address. Both at Second Reading and in Committee, the House was greatly exercised by the potential disagreement and difficulties that attended on the formulation of the Bill at that time, with these two tremendously significant institutions at loggerheads. The situation was not helped by the fact that the noble Lord, Lord Bichard, felt unable to contribute to our debate at that stage. We were all very anxious indeed about the position.
I hope that the Minister will answer quite straightforwardly the question asked by the noble Lord, Lord Higgins. I do not think that it is a question of whether there will be a publication, but of when. Whether it could be done in time for the process being considered while the Bill goes through the other place is a different matter. That certainly would be a great advantage and it ought to put pressure on the two bodies concerned to ensure that this memorandum of understanding is complete and published in short time.
On the more general issues, all parts of the House were greatly exercised by the position that developed as a result of the publication of the Bill. I am very glad to endorse the fact that peace has broken out, although on this occasion the Opposition did not have much to do with it.
Lord Bridges of Headley
My Lords, I thank all those who have offered me congratulations, which really should be to those in the Bank, the NAO and the Treasury who have been labouring long and hard on this. I have just been trying to oil the wheels as they go along. I am very nervous about the phrase “Peace in our time”, which one of your Lordships used. I get very nervous when that phrase is used, but I am very pleased with where we got to.
My noble friends Lord Higgins and Lord Young, and the noble Lord, Lord Myners, rightly pressed on the publication of the MoU. I can assure the House that the Government will provide an update on progress as the document develops, before the Bill has passed. Once complete, the MoU will be published and laid in the House Library. I do not want to tempt fate regarding the timing of this. However, as I said in my opening remarks, the process of drafting the MoU has only recently begun. I am sorry to say that I am not, therefore, in a position to share more details on this right now.
My noble friends Lord Higgins and Lady Noakes also raised the issue of what happens if the Bank and the NAO disagree. This amendment removes the court veto over what constitutes policy—the main concern of the House in Committee—and, instead, there is a requirement in the MoU for the NAO and the Bank to agree the process for resolving disputes. I will point out a few things here. It is important to note that much of the work which the NAO carries out across the public sector is governed by the National Audit Act 1983, which does not contain a statutory mechanism for resolving disagreements between the NAO and the number of public bodies it oversees about the scope of its reviews. The NAO works constructively with those bodies to define the scope of its work without the need for codified dispute resolution processes. I therefore hope that, in the vast majority of cases, issues arising between the NAO and the Bank will be resolved without needing recourse to a formal process. However, in the unlikely event that a matter cannot be resolved, the amendment goes further than the National Audit Act by requiring that a formal dispute resolution process is set out as part of the memorandum of understanding. As I said, this will set out in more detail how the NAO and the Bank will act to settle disagreements and how those will be recorded and published, where appropriate.
My noble friend Lord Higgins also wisely raised the subject of quantitative easing. In the case of companies of the Bank which are carrying out indemnified activities, such as the asset purchase facility—the Bank’s QE vehicle—new Section 7C, inserted by Clause 10, will apply. In those circumstances, the Treasury has the power to direct the company of the Bank to send its accounts to the Comptroller and Auditor-General, who would then be required to conduct a financial audit of the accounts and issue an accompanying report.
I thank all noble Lords who have contributed to this and to making this process and the agreement possible.
Lord Bridges of Headley
“(3A) An examination under this section is not to be concerned with the merits of—
(a) policy decisions taken by the Financial Policy Committee, the Monetary Policy Committee or the Prudential Regulation Committee;(b) policy decisions taken by a committee or other body within the Bank for the time being having responsibilities for the supervision of payment systems, settlement systems or clearing houses, so far as the decisions relate to that supervision.“(3B) Subject to subsection (3C), an examination under this section is not to be concerned with the merits of policy decisions taken by a committee or other body within the Bank for the time being having responsibilities for the exercise of any of the Bank’s resolution functions, so far as the decisions relate to those functions.
(3C) Where the Bank has exercised relevant resolution functions in relation to a financial institution, subsection (3B) does not prevent an examination under this section being concerned with the merits of policy decisions within that subsection which are relevant to the Bank’s exercise of its resolution functions in relation to that institution (whether or not those policy decisions are also relevant to other financial institutions).
(3D) “Relevant resolution functions” are—
(a) any of the stabilisation powers;(b) any of the Bank’s functions (other than its functions as the Prudential Regulation Authority) under or by virtue of—(i) Part 2 or 3, or section 233, of the Banking Act 2009,(ii) Part 6 of the Financial Services (Banking Reform) Act 2013.”
“( ) For the purposes of this section—
“resolution functions” means the Bank’s functions (other than its functions as the Prudential Regulation Authority) under or by virtue of—(a) Parts 1 to 3, and section 233, of the Banking Act 2009,(b) Part 6 of the Financial Services (Banking Reform) Act 2013,(c) the Bank Recovery and Resolution (No. 2) Order 2014 (S.I. 2014/3348);“stabilisation powers” has the same meaning as in the Banking Act 2009 (see section 1(4) of that Act).”
“7E Memorandum of understanding
(1) The Bank and the Comptroller must prepare and maintain a memorandum of understanding about examinations under section 7D.
(2) The memorandum must in particular include provision—
(a) as to functions of the Bank in respect of which the Comptroller will not usually consider it appropriate to carry out an examination;(b) identifying the committees or other bodies referred to in section 7D(3A)(b) and (3B);(c) establishing a procedure for resolving in a timely fashion any dispute between the Bank and the Comptroller as to whether a matter is (under section 7D(3) to (3C)) a matter with which an examination under section 7D is not to be concerned;(d) for the publication of the views of the Bank and the Comptroller as to whether a matter is such a matter, in cases where a dispute between them cannot be resolved.”
Lord Bridges of Headley
Lord Bridges of Headley
Lord Ashton of Hyde
“Financial Conduct Authority
In Chapter 1 of Part 1A of the Financial Services and Markets Act 2000 (the Financial Conduct Authority), after section 1J insert— “Recommendations1JA Recommendations by Treasury in connection with general duties
(1) The Treasury may at any time by notice in writing to the FCA make recommendations to the FCA about aspects of the economic policy of Her Majesty’s Government to which the FCA should have regard when considering—
(a) how to act in a way which is compatible with its strategic objective,(b) how to advance one or more of its operational objectives,(c) how to discharge the duty in section 1B(4) (duty to promote effective competition in the interests of consumers),(d) the application of the regulatory principles in section 3B, and(e) the matter mentioned in section 1B(5)(b) (importance of taking action to minimise the extent to which it is possible for a business to be used for a purpose connected with financial crime).(2) The Treasury must make recommendations under subsection (1) at least once in each Parliament.
(3) The Treasury must—
(a) publish in such manner as they think fit any notice given under subsection (1), and(b) lay a copy of it before Parliament.””
Lord Ashton of Hyde (Con)
My Lords, this amendment provides for the Treasury to issue remit letters to the FCA, a measure first announced in relation to both the PRA and FCA in the Government’s productivity plan in July. The Bill already makes provision for the Treasury to issue remit letters to the PRC and the amendment will enable Peers to consider provisions for the FCA and PRC remit letters together. As the House will know, the Bank of England and Financial Services Bill generally relates to the governance of the Bank, rather than the FCA. However, we have been considering the best legislative vehicle for the FCA remit letter provision and have decided that it would sit best alongside the PRC remit letter provision. As to the remit letter’s content, the productivity plan outlined that remit letters will provide information on the Government’s economic policy and will make recommendations about aspects of that policy to which the FCA should have regard. The recommendations in the letters will not be binding and will not compromise, modify, or override the FCA statutory objectives in any way; neither will they relate to individual firms or cases.
As to the timing and frequency of the publication of the letters, we are aiming to publish the first FCA remit letters following Royal Assent for the Bank of England and Financial Services Bill, after which they will be published at least once per Parliament. The letters will be used to provide a steer on the Government’s economic strategy over that period, but letters could be sent more frequently if particular issues arise.
Finally, the Treasury must publish its recommendations and lay a copy before Parliament. I beg to move.
Baroness Kramer
My Lords, our one concern with this amendment was that it could in some way compromise the statutory objectives of the FCA as laid down by Parliament. The Government wrote to us with an assurance that that was not their intention. Today, the Minister read into the record the text of the letter. He said that the recommendations would not compromise, modify or override the FCA’s statutory objectives in any way. Given that a Minister’s statement in Hansard is a weighty commitment, we are satisfied with the amendment.
Lord Davies of Oldham
My Lords, I was going to make almost exactly the same contribution and my question was exactly along those lines, so I am happy to endorse what the noble Baroness, Lady Kramer, said and look forward to the Minister’s response.
Lord Ashton of Hyde
My Lords, I am very grateful to both the noble Baroness and the noble Lord, Lord Davies. I can only repeat what I said before. I accept the weight and the implications of what I have said.
Baroness Kramer
“The FCA’s competition objective
In section 1E of the Financial Services and Markets Act 2000 (the competition objective), after subsection (2)(e) insert—“(f) how far competition is delivering diversity of provision, including diversity of ownership, geography, community and size.
Baroness Kramer
My Lords, once upon a time not so long ago, small local banks and building societies—some of them mutual, some of them not—served our local communities. They knew their local communities, the individuals and the businesses, and were themselves tied to the economic health of that community, thriving only when the community itself thrived. It was not utopia—I think that most of us in this House would not like a loan decision to be made by Captain Mainwaring—but those banks and building societies played an incredibly important role in making sure that we had a sector of banking that supported both the real economy and local development and regeneration. We have lost that layer of banking. The United States and Germany have retained it. During the last, very severe recession, it was notable that that layer of banking provided ongoing funding to individuals but, even more importantly, to small businesses, and a mechanism for the Government to support those small businesses. It also contributed to financial stability. Here in the UK our Government had to go through the most extraordinary contortions to funnel funds to small business.
We need to restore that level of banking. Banking is changing dramatically. Online banking and FinTech are largely disintermediating the big banking sector, which the main high street banks thought belonged to them. Online is very successful. I am delighted to hear that in the third quarter of last year Funding Circle became the third largest lender to small businesses in the UK. That is phenomenal for a company which did not exist five years ago. Although that successful change is coming, there is new competition. For many small businesses, online is not necessarily the answer. They need that partnership which was on offer from a community bank, community building society or community mutual, which could help them through the early stages of development and with many of their difficulties. Very few of the online providers take on that role. I can think only of ThinCats, and it is very small. Therefore, I can see no way in which we can restore that missing layer of banking without an effort by both the Government and the regulator. That is the purpose of this amendment.
The Government often talk about diversity, and I very much support Amendment 15, tabled by the noble Lord, Lord Naseby, which is in this group. But when the Government talk about diversity, they focus on making sure that the regulator treats diverse entities appropriately, which is entirely right. It should not attempt to fill the gaps and deal with the current market failure. I have named one significant area: that of local and community banks.
I am not going to press this amendment today, but I want to make sure once again that this matter enters the conversation, because it is a neglected area. In every conversation I have with government, the Treasury or the regulator, diversity is merely a fashion of regulating particular kinds of business. That does not recognise the significance of that gap and market failure. For that reason, I beg to move.
Lord Davies of Oldham
My Lords, the amendment tabled by the noble Lord, Lord Naseby, which the Government support, is an important step. We welcome the move by the Government to commit to a more diverse financial sector, in which the mutuals are clearly key. However, it is not enough merely to put this into legislation—action is required. What are the Government doing to ensure that this is more than just a gesture? Presumably, the FCA’s remit letter will have to be changed to reflect this new principle. Will the Government therefore commit themselves to introducing an amendment at Third Reading to reflect this obvious fact?
Lord Naseby (Con)
My Lords, I shall speak to the new clause which stands in my name as Amendment 15. In doing so, I reflect the privilege of working with the mutual movement for 30 years. In creating this amendment, it was very clear that the Bill as it stood left some gaps of the one-size-fits-all kind. I gave some examples on Second Reading and further examples in Committee. Indeed, I can record this evening in your Lordships’ House that there is one new mutual insurer now trading, for the first time in 20 years. It is a new military mutual, serving our Armed Forces. I cannot think of a better new mutual to stand on the market than one which serves our Armed Forces.
I pay tribute to the Front Bench and in particular to the Minister. I understood that the examples I gave of misunderstandings, or of being left out or not fully understood, have been looked at by Her Majesty’s Treasury. I think that they were found to be quite genuine cases. I recognise that Her Majesty’s Government reserved the right, from the start, to look at the wording of the original new clause that I had tabled. I always had an open mind that those words might have to be amended, if necessary. They have been and are now before us.
There is still a problem in the world outside in understanding this. Half the population is being served by mutuals, yet very few people in authority really understand the driving force behind the mutual movement and why it is growing today. There is a need for all of us in society, particularly the regulators, to have a better understanding. I question whether the new regulator has anybody senior who has ever worked in a mutual. If not, then I hope there will be some appointments made hurriedly.
As far as the mutual movement is concerned—the building societies, the mutual insurers, the friendly societies and credit unions, and of course the Co-Op—tonight will be a special night if this new clause is accepted. It will recognise that their future needs will have to be considered and be better understood, so I say a huge thank you on their behalf to your Lordships’ House if this new clause is accepted.
Lord Ashton of Hyde
My Lords, I am grateful to both the noble Baroness, Lady Kramer, and my noble friend Lord Naseby for raising this important issue. I will take each of their amendments in turn.
The amendment in the name of the noble Baroness, Lady Kramer, would add diversity of provision, including diversity of ownership, geography, community and size, to the list of factors to which the Financial Conduct Authority may have regard as part of its competition objective. The Government agree that access to suitable and affordable banking services is important for communities across the UK. The Government want to see greater competition in our banking sector, with more banks challenging the large incumbents. If communities or entrepreneurs want to set up a bank, either to serve their local community or to compete nationally, and can do so responsibly, Government and regulators should not be an obstacle to this.
This is exactly why the FCA is already required to promote effective competition in the interests of consumers of regulated financial services. We would expect its consideration of competition already to involve not just the number of competitors but the diversity of approach, including geographical location and community. In advancing its competition objective, the FCA may take account of various factors including barriers to entry for new providers of financial services, the needs of different consumers and the differences of businesses.
Baroness Kramer
Can I just add one point for the Minister? The FCA has recently completed a review of its competition objective, and he may be surprised to find that the word “diverse” does not occur anywhere in that review.
Lord Ashton of Hyde
After this, it will be alert to the need to look at diversity. I will come to how we deal with mutuals in a minute. On the last point about the needs of consumers and the differences of businesses, the statute is also clear that the regulators should recognise the different features of a diverse range of business models when pursuing objectives. This is achieved by the principle of good regulation whereby the regulators must have regard to,
“the desirability where appropriate of each regulator exercising its functions in a way that recognises differences in the nature of, and objectives of, businesses carried on by different persons subject to requirements imposed … under this Act”.
As part of fulfilling the existing competition objective, the Government have worked with the regulators to lower barriers to entry. That is why the Government created the Payment Systems Regulator to ensure all banks can access the payments systems on fair and equal terms.
These reforms and others have already had a significant impact, which I hope answers, in part, the noble Lord, Lord Davies. Between May 2010 and May 2015, eight completely new UK banks, all of different sizes and locations, were authorised by the regulators, including two new banks during this Parliament, with several more in the pipeline. This compares to just one new authorisation of a UK bank in the preceding five-year period. The PRA and FCA will also launch their new bank start-up unit on 20 January next year.
Furthermore, to encourage banks to provide services across a broad range of geographical locations and improve access to finance for small businesses across the UK, a number of measures have been implemented, which I will briefly go through. There is now the SME appeals process and the Business Banking Insight survey. The Government have also established the British Business Bank. These improvements complement another initiative: the postcode lending policy, which has allowed for these alternative finance providers and challenger banks to target regional lending “black spots” through publishing lending data by geographical region. This makes the British banking industry the most transparent in the world.
Given all the activity already taking place in this field, it is the Government’s view that the amendment in the name of the noble Baroness, Lady Kramer, will not add to the existing work being conducted by the FCA. It is clear the regulators already take these factors into consideration when fulfilling their competition objective, so this amendment is unnecessary. I therefore respectfully ask the noble Baroness to withdraw it in due course.
Turning now to my noble friend Lord Naseby’s amendment, I indicated in Committee that the Government looked favourably on the intention behind his original amendment. I now welcome my noble friend’s current amendment, which we are delighted to accept. I am extremely grateful to him for raising this issue, and acknowledge the work he has undertaken in advancing the cause of mutuality. I hope that introducing the amendment, which puts consideration of mutuality and other types of business organisation into both regulators’ guiding principles, reassures noble Lords, including the noble Lord, Lord Davies, that the Government strongly support a diverse financial services sector and the part that mutuals play in achieving it.
Lastly, the noble Lord, Lord Davies, asked whether an amendment was needed to the FCA remit letter to reflect the amendment that we will accept. We do not agree, and I therefore cannot give that commitment, because the provision for the remit letter already allows the Government to make recommendations about aspects of their economic policy relevant to the application of the regulatory principles, which will apply to the principles as amended.
Lord Naseby
My Lords, I record my enormous thanks to Her Majesty’s Government, colleagues from across the House and, in particular, the spokesmen from the Liberal Democrats and the Opposition for their help in the early stages of drafting the amendment.
Lord Naseby
“Diversity
(1) Section 3B of the Financial Services and Markets Act 2000 (regulatory principles to be applied by both regulators) is amended as follows.
(2) In subsection (1)(f) after “persons” insert “(including different kinds of person such as mutual societies and other kinds of business organisation)”.
(3) After subsection (3) insert—
“(3A) “Mutual society” has the same meaning as in section 138K.””
Baroness Worthington
“ReportingFinancial sustainability report
(1) Within twelve months of the coming into force of this Act, the Treasury must prepare and publish a report containing the matters specified in subsections (2) and (3).
(2) The report must contain an assessment of how the following aspects of financial regulation contribute to or hinder the United Kingdom’s long-term sustainable economic growth—
(a) rules governing the admission of securities to recognised growth markets,(b) rules governing the admission of securities to the Official List, and(c) the time horizon of the Bank of England’s financial stability monitoring activities.(3) The report must make recommendations for the development, via the regulation of financial services, of uniform, consistent and clear standards for the disclosure of climate-related financial risk, in order to provide information to lenders, insurers, investors and other financial intermediaries.
(4) In this section—
“long-term sustainable economic growth” means economic growth that is resilient to risks arising from long-term fundamental change, such as climate change, technological change and demographic change;“recognised growth market” has the meaning under section 99A of the Finance Act 1986;“Official List” has the meaning under section 74(1) of the Financial Services Markets Act 2000;“the Bank of England’s financial stability monitoring activities” means activities undertaken by the Bank of England in order to meet the objectives set out in section 2A of the Bank of England Act 1998.”
Baroness Worthington (Lab)
My Lords, in Committee we considered three issues relating to the wider sustainability of financial services in the UK and the way they are regulated and overseen partly by the Bank of England, and by other bodies. In tabling this amendment at Report, I have endeavoured to capture the three topics that we discussed previously in one overarching obligation or requirement on the Treasury to report back to the House on these important issues.
Since Committee, two very important events have served to illustrate the importance of wider sustainability, and climate change in particular, in relation to our financial services. The first is the appalling flooding throughout the North of England and the impact that has had on our businesses, homes and financial services. The second is the signing into law of the climate change agreement in Paris, which clearly sets the world on a path towards rapid decarbonisation in order that we can stay within the new goal of a limit of well below 2 degrees centigrade, aiming for 1.5 degrees. This has been virtually universally accepted as an historic moment which will have significant ramifications.
On financial services and our economy, it is clear that we will need to adapt to oversee an orderly transition from a relatively carbon-intensive system to one in which we are no longer adding anthropogenic carbon dioxide emissions to the atmosphere. The Treasury and the bodies which report to it can have a significant role in helping to bring about that orderly transition.
I will briefly mention the three issues the amendment touches on, the first of which is that we should consider the way we list various entities on our growth markets. It is clear that the Government intend to encourage investment in growth markets—they have indeed introduced a host of tax benefits to the companies listed in our growth markets—but these are relatively unregulated. The nature of those markets is that they can attract companies with a relatively short outlook—a desire to raise capital in London without thinking more broadly or in the longer term. A number of companies listed in our growth markets, including the AIM market, are in the extractive fossil fuel industries, which I would be hard pressed to classify as growth industries that the Government should be seeking to encourage investment in. We have asked that a report should look at these aspects and consider whether there is more that needs to be done to oversee the way in which these growth markets are attracting capital and rewarding investment.
The other important issue that we would like to be reported on is disclosure. I am grateful to my noble friend Lord McFall and the noble Lord, Lord Deben, who is not in his place, who spoke on this so eloquently in Committee. This topic is gaining in prominence. Indeed, in Paris, the Governor of the Bank of England, Mark Carney, announced that Michael Bloomberg will assist him in the FSB in looking into the whole issue of disclosure at an international level. I have spoken directly with the Minister about this, and I know that the Treasury view is that this should be conducted at an international level. I do not disagree with that, but in the spirit of leadership, which we showed so clearly in Paris, it is appropriate that the UK should lead at home on these issues and not simply rely on international, multilateral processes. We are, of course, one of the largest financial centres in the world; we have a number of extractive and energy industries listed here, raising capital here and operating from here, and it is incumbent on us to work out what more can be done to ensure that we speed this orderly transition to a cleaner economy.
Lord Teverson (LD)
My Lords, it is a great pleasure to speak to this amendment. Indeed, I had meant to put my name to it, and I apologise to the noble Baroness, Lady Worthington, for not having managed that. It is also a pleasure for me to speak today on the Bank of England Bill, as I managed to visit the Bank for the first time today; the noble Baroness, Lady Wheatcroft, was one of the other people there. For the first time, I actually held a gold bar, which I think was going down in value—nothing to do with me but more to do with world markets. It was worth a mere £250,000, I believe.
The amendment is important. Let us be clear: the world has changed, even over the last week. Climate change and the inherent risks to investment, financial instruments and the sector as a whole have been brought to international and corporate attention. The amendment is not just about climate change, although that is my particular interest; it is about technological and migration changes, and all the other challenges we will face not just as a nation but as a much broader economy over the next few years. That is why a report that looks at these issues is very important. It is the further move forward that we need for our financial stability and for our long-range radar, to see where those risks and challenges come from.
When I first saw the amendment, I assumed that the Bank of England would have to make this report. It is absolutely appropriate that it is in fact the Treasury—and slightly ironic, because I get the impression that, although many parts of government are very positive on the green and climate change agenda, within the Treasury there is perhaps the occasional odd hesitancy. That is why I particularly welcome the amendment, and I hope the Government will consider it extremely seriously.
Lord Davies of Oldham
My Lords, it is only a short while ago that my noble friend Lady Worthington was speaking from the Front Bench, so it is somewhat otiose for me to seek to surpass her eloquence on the crucial issue of climate change, on which she has spoken in this debate and earlier this afternoon following the Statement on the outcome of Paris. The noble Lord, Lord Bourne, also distinguished himself in that discussion, as he did during his work in Paris. I therefore hope that the Minister, who, as my noble friend hinted, comes from a slightly different quarter—the Treasury—will not be any less enthusiastic in his response to Paris, where 195 countries reached agreement on aspects of what needs to be done. Of course, the Government have a little ground to make up after the past six months, when they seemed to many to be pursuing policies counter to the concept of the green and long-term sustainability agenda—but I am sure the Minister will take full opportunity to show his enthusiasm today.
Lord Bridges of Headley
My Lords, I am sympathetic to the intent of the amendment, and it is important that the Government consider how they can ensure that economic growth is resilient to risks arising from long-term fundamental changes. As the noble Lord, Lord Teverson, said, it is not just about climate change; there are technological and demographic changes, all of which could have significant implications for the global financial system. It is also important for the Government to understand and adopt best practices for the disclosure of climate-related financial risk. I agree with the noble Baroness, Lady Worthington, and she is right to raise this issue. However, as I hope I shall explain, the amendment is unnecessary and I hope noble Lords will agree with me.
The current legislation already provides for the statutory framework for the Financial Policy Committee to consider long-term systemic risks such as those listed in the amendment. Indeed, at its meeting of March 2015, the FPC discussed precisely one of those risks—to financial stability. This is evidence that the FPC considers risks across the breadth of time horizons and will continue to identify long-term as well as more immediate risks. The Bank is also taking action on longer- term systemic risks through other channels. The issue of climate change, for instance, has been added to the Bank’s One Bank Research Agenda. Requiring the Treasury to produce an additional report on sustainability would mean unnecessary duplication of work.
On the topic of admission of securities to growth markets, the UK’s financial markets are obviously crucial to the efficient allocation of capital that supports jobs and growth, including to unquoted companies where the Government allow certain tax exemptions to improve access to the finance necessary for companies to expand. AIM, as the biggest SME growth market in the UK, plays an important role in providing funding opportunities beyond bank finance for unquoted SMEs which cannot fulfil the requirements of the main market at this stage of their life cycle.
Turning to the specific issue of disclosing climate-related financial risks, at the Paris climate change conference the Governor of the Bank, in his capacity as chair of the Financial Stability Board, announced that the FSB is establishing a task force on climate-related financial disclosures—the point the noble Baroness mentioned. This announcement follows the “Breaking the Tragedy of the Horizon” speech given by Governor Carney at Lloyd’s of London earlier this year. The newly established task force, under the chairmanship of Michael Bloomberg, will develop voluntary, consistent climate-related financial risk disclosures for use by companies in providing information to lenders, insurers, investors and other stakeholders.
It is our firm belief that climate change as a global phenomenon can be tackled most effectively through co-ordinated international action. As the noble Baroness mentioned, to date a lack of co-ordination on the topic of disclosure initiatives has resulted in an estimated 400 different climate-related disclosure schemes. There is a real risk that this inconsistency makes it challenging for investors and other stakeholders to judge climate-related risks effectively.
The Financial Stability Board, as the authoritative forum for considering potential financial stability risks, provides the ideal international setting in which climate-related financial risk disclosures should be discussed, standards agreed and recommendations made. This Government are therefore fully supportive of the work of the FSB task force and have instructed government officials to engage fully in this international debate to ensure that the long-term financial risks associated with climate change are given full consideration.
This amendment requires the reporting of recommendations on standards for the disclosure of climate-related financial risk within 12 months of the coming into force of the Act. Considering that the task force is scheduled to complete its work within a year, this suggested timetable risks pre-empting the work of the task force already under way.
This is not to say, however, that domestic action does not have a role to play in improving climate-related risk disclosure. In fact, regulations made under the Companies Act 2006 already require all quoted companies to report on their greenhouse gas emissions. I submit that between our considerable spending commitments, our stance in international negotiations and our leadership in mobilising the financial system to help combat climate change, the Government are at the very forefront of efforts to understand and address the full range of financial risks that long-term fundamental change, such as climate change, could pose. I therefore, with respect, ask the noble Baroness to withdraw her amendment.
Baroness Worthington
My Lords, I am grateful to the Minister for his response. I am not entirely satisfied that this issue has been looked at in sufficient detail by the Treasury. I am grateful to the Minister for his answer in response to the FSB, but in London now we have some of the brightest and best minds in the financial services sector and we can begin to address this problem ahead of our international efforts.
In particular, I am interested in how we are regulating unlisted companies. The Minister is correct to point to the disclosure requirements on listed companies, but we are giving substantial tax incentives to a fairly unregulated part of the financial sector upon which a large part of our economy relies, and more scrutiny is needed on that sector in particular.
However, at this stage, I am happy to withdraw the amendment, and I hope that this debate and this topic of conversation will continue in this House and in the other place. I beg leave to withdraw the amendment.
Lord Bridges of Headley
“( ) The Financial Services and Markets Act 2000 is amended as follows.
( ) ”
Lord Bridges of Headley
My Lords, Amendments 17, 18 and 19 make some small technical changes to the Bill. The purpose of Clause 19 is to enable the regulators to include the full range of transitional provision in their rules when they bring in new senior management functions. The clause also gives the Treasury a wider power to make additional provisions in regulations to deal with complicated cases.
Amendments 17 and 18 implement a recommendation of the Delegated Powers and Regulatory Reform Committee in relation to those regulations. The amendments will ensure that the affirmative resolution procedure applies to any regulations under the new Section 59AB, which make provisions modifying, excluding or applying primary legislation.
Turning to Amendment 19, under the approved persons regime, the regulators have only the power of approval to perform a controlled function or, of course, to reject the application for that approval. The Financial Services (Banking Reform) Act 2013 gives the regulators the power to make senior management approvals subject to conditions or time limits. Clause 20 makes changes to these provisions to allow time limits as well as conditions to be varied after the initial approval has been given. Amendment 19 corrects an anomaly in these new provisions. The amendment will ensure that, where a regulator wishes to vary an approval on its own initiative, it must consult the other regulator if that regulator gave or varied the approval in question. Without this amendment, the other regulator would have to be consulted if it had given the original approval but not if it had only varied an existing approval. I beg to move.
Lord Davies of Oldham
My Lords, as these are technical changes we do nothing but endorse them and comment on the obvious fact that the Minister has not been in post overlong but has shown proper respect for the Delegated Powers and Regulatory Reform Committee and has moved with alacrity to enforce its request.
Lord Bridges of Headley
“( ) In section 429(2B) (regulations subject to affirmative procedure) for “contain” substitute “contain—
(a) provision made under section 59AB(2) which modifies, excludes or applies with modifications any provision of primary legislation;(b) ”.”
Lord Bridges of Headley
“( ) after subsection (4) insert—“(4A) Before one regulator varies an approval which was last varied by the other regulator, it must consult the other regulator.””
Lord Tunnicliffe
Lord Tunnicliffe (Lab)
My Lords, I rise with some trepidation to bring this period of peace to a close. I, too, have been involved in this Bill from the beginning and have worked with my noble friend Lord Davies and the Minister, and I, too, thank him for the enormous amount of time and effort he has put into trying to achieve a consensus on so much of the Bill. The amendments we have already agreed tonight are the product of that work. I also commend the Minister, his team and the members of the Bank, the PRA and so on who put so much effort into trying to persuade us not to move this amendment. It is somewhat sad that they failed, and therefore I rise now to speak to Amendment 20, which is tabled in my name and that of my noble friends Lord Davies and Lord McFall and the noble Baroness, Lady Kramer.
The effect of the amendment is simple. It would ensure that the so-called reverse burden of proof on senior managers comes into force as planned from March 2016. The Government have argued that the Financial Services (Banking Reform) Act 2013 and the senior managers and certification regime—the SMCR—represent a significant improvement to the regulatory system and the regulatory standards that existed before the financial crash. On this, we are in full agreement. Along with the structural reforms that have already been set in motion by the Financial Services Act 2012, the 2013 regulation also had a very important message for senior managers in the financial service sector. From March 2016, the burden of responsibility for failure to prevent regulatory breaches would live solely with them, and whether they were aware of failings or not would be irrelevant. They would have to show that they had taken all reasonable steps necessary to prevent a breach taking place. Quite simply, the buck would stop with them.
Two years on, before the regime has even come into effect, the Government want to back-track on the promises they made to the British public and replace the reverse burden of proof with a duty of responsibility. That means that the burden will be on the regulators, rather than the bankers themselves. According to the Government, the introduction of the duty of responsibility in place of the presumption makes little difference to the substance of the new regime. They even suggest that the change is one of process, not substance. We disagree.
We believe that the retention of the reverse burden of proof is crucial. So too does the Parliamentary Committee on Banking Standards and, following intense debate in your Lordships’ House and the other place, so did both Houses of the previous Parliament. Despite a lack of any case history to back up their claims or any examples to draw on, the Government have suggested that the original proposals will create a checklist and tick-box mentality that ultimately will be unhelpful, and that merely presenting evidence that this template had been followed would enable senior managers to meet the burden of proof for defence but leave the regulator to prove that the steps taken were not reasonable.
As I stand here, Major Tim Peake, the first British man in space—whether he is the first British person is somewhat debatable—is safely up there, speeding over us at 175,000 miles an hour. Actually I do not really know where he is; he could be thousands of miles away, but the fact is that he is safely in space. How did he get there? Did a bunch of people wake up this morning in Russia, join together and, to somewhat paraphrase the Minister’s letter, form a responsible management team taking considered and reasoned decisions? No, they did not; they woke up this morning with checklists that they went through and ticked off, and, because those checklists contained hours of thought and lots of experience all moulded together into a process, the take-off was successful and he is safely in space.
In deriding the value of checklists, the Government could not have picked a less appropriate person than myself. I have lived with checklists for over 50 years. Ever since the man said, “If you don’t learn the checks, lad, you can’t fly the aeroplane”, I have been involved in checklists. I was involved with checklists in aviation and in the railway industry, of which I ran a small but important part and we ran a whole series of operations using checklists. We did not call them checklists; we called them manuals and procedures. We would spend millions of pounds on a whole variety of projects because at board level we considered what rules to make, and at executive level we said, “Meet these rules if you want your projects to run”, and that worked well. Then I moved into the nuclear industry, where if you wish to run a nuclear site you will approach a checklist of 36 chapters that forces you to set out how it will be run and be safe and viable. For a period I was chairman of the Rail Safety and Standards Board, which did nothing but create rules that people had to obey to make things safe.
So I am afraid that I believe in checklists. If the present legislation means that banks are spending their time carefully setting out what procedures should be followed in order for them to operate safely and legally, then that is a good thing. Good checklists, good tick-box procedures and good checks on those procedures are a good thing. Bad checklists are a bad thing, bad law is bad, bad procedures are bad and bad regulation is bad, but we are not talking about them; we are talking about banks using their resources to ensure that they obey the rules of the future.
I turn to what I believe is the heart of the issue, something that the Government have dismissed over and again: the question of culture—more specifically, what will bring about the much-needed cultural change in the banking sector. There was a time when banks were trusted and respected, part of the local community. The noble Baroness, Lady Kramer, referred to Captain Mainwaring. He was a cartoon figure, but that was how my generation looked at banks. We expected banks to give a service for our interests; we had the sense that we could trust them and did not have to question them. We were probably naïve and maybe we were being ripped off rotten, I do not know, but we trusted them. We are not there any longer. Ask the British public today what they think of banks, and bankers in particular, and they will use words like “greed” and “exploitation”. You certainly cannot blame them for thinking that way; events like the PIP scandal, rate swaps or HBOS give people the impression that these are not the exception but the norm. A change of culture is desperately needed if banks are to regain their reputation as public service institutions. I am certainly not saying that this will be an easy or quick task. It will require sustained effort from all involved, but in the view of the Opposition there is no better starting point for this repair than the implementation of the reverse proof of burden.
Lord Tunnicliffe
Thank you very much—the implementation of the reverse burden of proof. If I go back to my script, I will get it right.
It is important not to underestimate, as the Government seem to be doing, just how significant a departure this would be from the previous regime, not only symbolically but practically too. There could be no denying the intent and commitment to bring about the most rigorous and thorough regulatory regime if the reverse burden of proof were introduced. We believe that knowing that there is nowhere to hide from failure, and that the burden is on you as a senior manager to prove that you took all reasonable and necessary steps, is a more powerful tool to bring about such change. That is why Labour has tabled this amendment to ensure that it comes into force next March, along with the rest of the SMCR.
We have been prepared to listen to the Government’s defence, and accept that they have put forward a very convincing point about why the reverse burden of proof might not be wholly acceptable in its current form. I speak specifically on the issue of proportionality. Given that the Bank of England and Financial Services Bill extends the scope of the SMCR to the entire financial services sector, we fully acknowledge that exemptions from the burden of proof for those not covered by the original proposals would be entirely sensible and necessary, but we do not regard a differentiation in regime as an insurmountable hurdle to overcome.
Therefore, by way of consensus, if the Government would be willing to indicate their intention to bring forward amendments at Third Reading preserving the reverse burden of proof but making exceptions for smaller firms, we would be open to further discussions. However, if the Government fail to do that, it is our responsibility to stand up for the change that people desperately want to see in the banking sector. It is the difference between reform and the status quo—the difference between the path back to public trust and continued disbelief. It is the difference that we need and deserve.
Baroness Kramer
My Lords, I am going to speak only briefly on this issue. My noble friend Lord Sharkey, who is sitting beside me, is perhaps the greater master, with particular expertise of the detail, and I do not think that the House needs to hear the same speech twice. Still, I want to make a few remarks because this is such a crucial issue.
To pick up the point made by the noble Lord, Lord Tunnicliffe, I say that the importance of the reversal of the burden of proof is, above all, its cultural impact—the impact that it has on every chief executive and every head of department to understand that if things go wrong, if there is misconduct and bad conduct within their own department, they are essentially on the line. Historically they have not been, and they know that. This reversal of the burden of proof changes that impact. We can tell that from the many conversations that I keep hearing from the Government that, if there is a reversal of the burden of proof, it might be harder to recruit new people to these posts because of the burden that now sits there.
In a world where we are sure that regulation alone cannot ensure that the banking industry behaves properly, and where enforcement is exceedingly difficult, it is very hard to follow a paper trail when lawyers have been very careful to ensure that one does not exist. There might be no electronic trail either; in fact we have just seen an example of such behaviour by Barclays, which explicitly set up a scheme, for which it has since apologised, which was designed to have no electronic trail whatever. Where the trail is so extremely difficult to follow, what matters is that chief executives and heads of department and other key players lead that cultural change; that they appoint people who will challenge them; that they put people in positions where they will blow the whistle when things go wrong; and that they drive through their whole organisation an understanding of the importance of ethical behaviour and proper conduct. That is the best defence that we can have.
Frankly, government arguments for cancelling the reversal of the burden of proof—the sort of argument for a key reason—have constantly shifted over the past few weeks when we have been discussing this issue. To gather from the last set of conversations around this issue, the argument is now primarily that the senior managers regime, which identifies who is responsible for different activities and different tasks, is both much tougher than the existing regime and much tougher without the reverse burden of proof rather than with it.
Lord Brown of Eaton-under-Heywood (CB)
My Lords, speaking purely as a superannuated judge with no particular expertise in banking, I oppose the amendment. Article 6.2 of the European Convention on Human Rights says:
“Everyone charged with a criminal offence shall be presumed innocent until proved guilty according to law”.
Baroness Kramer
I will just make a point of clarification, because a number of noble Lords have made this comment. The reversal of the burden of proof applies not to a criminal offence but to a civil offence.
Lord Brown of Eaton-under-Heywood
With respect, as I understand it, this is a punishable offence; therefore it is a criminal offence. I certainly understand that it is proposed that this offence should be on the statute book to bring blame on those who commit it and lower them in the estimation of the public so that a conviction or finding of guilt under this provision would be to their considerable disadvantage. I have little doubt that Article 6 would apply to how one proves this breach of the law. There is nothing very new in this either. The golden thread that for centuries has been said to run through our law is that it is for those who accuse to establish a case against those who are accused.
Lord Sharkey (LD)
Is the noble and learned Lord aware that the Minister who introduced the Financial Services (Banking Reform) Act 2013 into Parliament certified that it was not in breach of the convention he quoted?
Lord Brown of Eaton-under-Heywood
That is by no means conclusive of the issue. However, for the most part I am not hinging my argument on the convention; it simply represents what I have already indicated is a common thread of our law—it is for those who accuse to prove. Generally, the burden of proving every ingredient, every element of any wrongdoing or offence—including the disproving of any legal defence to it—lies squarely on the prosecution.
Certainly, there are occasions when the law, including the European Convention on Human Rights, accepts a reverse burden of proof. However, in considering whether this is acceptable one must recognise that whenever an accused is required to prove a fact, as here he would be on the balance of probabilities, that permits him to be found guilty, even if the fact-finding tribunal has some reasonable doubt as to his responsibility. That is the whole essence of the burden of proof. Where there is a doubt, it is resolved in favour of he who stands to be criticised and held liable before the public. It is all very well to speak of the cultural impact of a change like this but the consequence is that in a case of doubt, because he has failed to discharge the reverse burden placed upon him, he is found guilty.
There is a great deal of law in all this, which I will not go through, but I will make just one or two points. First, there is all the difference in the world between the legal burden of proof and the evidential burden of proof. Realistically, the latter is of comparatively little importance. In relation to many defences, the evidential burden is said to be on the defence but this burden is found to be discharged whenever there is any evidence—basically, any evidence at all, wherever it comes from—which raises the possibility that such a defence may exist. For example, when somebody is accused of assault, if there is a suggestion that he may very well have acted in self-defence, the legal burden to disprove that immediately shifts back fully on to the prosecution. The fact is that courts—there are many cases to indicate this—do not like reverse burdens of proof and prefer this golden thread. It is by no means impossible, and I think it is quite likely, that under the 2013 Act—the one for which the certificate was given under the convention—that would be found to be consistent with the convention because the court would construe the legislation as involving not the legal burden of proof but the evidential burden of proof, in which case it would have precious little effect.
The legal burden of disproving guilt is only very rarely put on the defendant. It generally happens only in the case of statutory offences concerned with the regulation of conduct in the wider public interest, and generally in comparatively minor cases involving—I quote from an earlier judgment—
“no real social disgrace or infamy”.
That approach was applied in a trademark case where a trader in branded goods was required to prove that his sale of the goods did not involve any infringement of the trademark legislation. It was held to be in the nature of a regulatory offence with a minor degree of moral obloquy rather than a truly criminal case. Indeed, that was also the position in a case in this House in 2008 in which I was one of the judges. We held that it was not disproportionate to put the legal burden on employers to conduct their undertaking in such a way as to ensure that people were not exposed to health and safety risks. It was for them to establish on the balance of probabilities that it would not have been reasonably practicable for them to have done more than they had to achieve those requirements.
The effect of this amendment is conveniently and succinctly set out in paragraph 137 of the Explanatory Notes. It says that under the 2013 Act senior managers in the relevant area,
“are guilty of misconduct if there has been a breach of any regulatory requirement in an area for which they are responsible unless they can prove that they have taken reasonable steps to avoid the breach … This will be amended so that no senior manager will be guilty of misconduct unless the regulators can prove that the senior manager did not take reasonable steps to avoid the breach happening”.
I respectfully support the Government’s view that the offence being introduced by this legislation, prospectively from the coming March, should properly be considered to be not just a mere regulatory offence involving negligible obloquy—that is not how I understand that the bulk of those opposite would regard guilt of such an offence—but, rather, as constituting serious misconduct. It is the sort of offence, therefore, which should be fully proved and where any doubt as to whether it was committed should be resolved in favour of he who is accused.
Lord Grabiner (Non-Afl)
My Lords, I declare the interests shown under my name in the register. I should also declare that I am an authorised person under the regimes operated by the FCA and the PRA.
This part of the Bill is designed to extend the senior managers and certification regime, which replaces the much reduced—or, I should say, criticised—approved persons regime. It introduces a new statutory duty of responsibility for all senior members across the extended SMCR in place of the reverse burden of proof, which would otherwise have applied to deposit-takers and PRA-regulated investment firms. The new duty obliges the responsible senior manager to take reasonable steps to prevent regulatory breaches in her or his area of the business. As a result, if the complaining regulator shows that the senior manager has failed to take appropriate steps, she or he will be guilty of a breach of statutory duty. No doubt the Minister will assist us on this but I think that that will subject the individual to serious penalties, including an unlimited fine and/or a prohibition. These are very serious matters, whether they are offensive to Article 6 or otherwise.
Lord Sharkey
My Lords, I have a short checklist of points that I would like to make. I start by thanking the noble Lords, Lord Bridges and Lord Ashton, and their team for the very high levels of engagement on the Bill. That applies too to their officials and the officials of the Bank, especially Anthony Habgood and Andrew Bailey. It has all been extremely helpful and it has resolved some, but not all, of the questions that were raised in Committee. Clause 22 is one of the unresolved questions.
As other noble Lords have said, Clause 22 alters the SM and CR that Parliament agreed to in the Financial Services Act (Banking Reform) 2013. This Act put into law the unanimous recommendation of the Parliamentary Commission on Banking Standards. The commission’s report recommended that the PRA and the FCA should be able to impose,
“the full range of civil sanctions, including a ban, on an individual unless that person can demonstrate that he or she took all reasonable steps to prevent or mitigate the effects of a specified failing”.
The reason given for proposing this measure was that it would,
“make sure that those who should have prevented serious prudential and conduct failures would no longer be able to walk away simply because of the difficulty of proving individual culpability in the context of complex organisations”.
This is an issue that was settled by Parliament in 2013.
Mark Taylor, Dean of Warwick University Business School, former FX trader and an adviser to the Bank of England’s Fair and Effective Markets Review, commented on the situation in May. Mr Taylor said that bonuses are too high, there is little threat of jail for wrongdoers and bosses are not held responsible. He said:
“The problem is the incentives for cheating markets is massive. If you can shift a rate fractionally you can make millions and millions of dollars for your bank and then for bonuses”.
He went on to say that:
“Once senior executives feel they are personally at risk if the culture doesn’t change, and individual traders feel they are at risk of being put in prison, then you’ll get a culture change”.
The Parliamentary Commission on Banking Standards recognised all that, which is why it recommended the new regime. Parliament recognised all that, which is why it passed the new regime into law. This new regime was due to come into force at the end of March next year, but Clause 22 stops that. It replaces the new regime with a lighter version.
Over the course of the stages of this Bill and in discussion, the Government have offered a variety of justifications for reverting to a lighter-touch regime. There have been four main arguments to date. The first was that, since the Bill extends the supervising regime to all financial services, the tougher regime would bear down disproportionately on the smaller firms being brought under supervision. This is not a convincing or even coherent argument for relaxing the regime for systemically important players. It is an argument for a sensible two-tier regulation system—nothing more.
The second argument was that the prospect of the new, tougher regime was leading to individuals spending more time and resources mitigating the risk of being held personally liable for breaches on their watch. This was the whole purpose of the new, tougher regime.
The third argument, put forward by Andrew Bailey, was that noise around the tougher regime has been distracting future senior managers from complying with the spirit of other important aspects of the regime. Mandy Rice-Davies would have known how to respond to that.
The fourth argument I have heard made, entirely understandably—I heard it again this afternoon—was that the reverse burden of proof runs counter to our legal traditions. The Government have not pressed this argument strongly, but other noble Lords have at previous stages. I simply point out that there is ample precedent for this in English law and a helpful Law Lords ruling on where such measures are appropriate. The reverse burden of proof has been used in the Road Traffic Act 1988, the Health and Safety at Work etc Act 1974, the Bribery Act, the Terrorism Act, the Misuse of Drugs Act 1971, the Trade Marks Act 1994, the Criminal Justice Act 1988 and the Official Secrets Act, and there are other examples as well.
But in the past few days, the arguments have focused on a different aspect of the proposed change: that the rigorous specification of responsibility will make it easier to identify senior managers who are guilty of misconduct or unreasonably allow misconduct to take place. This argument was advanced forcefully by the noble Lord, Lord Bridges, in response to my Oral Question of 2 December, and by Andrew Bailey at a private meeting last week.
There is a very serious flaw in this argument. It assumes that it was previously impossible to identify senior managers with responsibility for misconduct. That is not the case. At the very least, board members and departmental heads carry, and have always carried, responsibility. That was not the problem. The problem was the evidence trail. This was, in all cases, so defective that all senior managers could say and did say, “I didn’t know”, and that was enough to get them off the hook.
As Tracey McDermott, the then director of enforcement and now acting CEO of the FCA, said in 2013 to the Parliamentary Commission on Banking Standards, the inability to impose sanctions on senior executives was first and foremost due to the evidential standard required to prove their liability. That is why the old regime produced no penalties against senior managers, and that is precisely why the regime proposed in Clause 22 will not do that either. It is absolutely no use having a detailed organisation and responsibility chain if there is no evidence trail. Barclays knew this when it sent some of its people out to buy a safe to keep incriminating documents out of sight and prevent an electronic trail.
Then there is the question of equality of arms. Banks are rich. They employ many very bright people on astonishing amounts of money; they can afford very expensive and extended legal defences; they have absolutely enormous resources. By contrast, the FCA is underresourced, underpaid, overstretched and outgunned. The G30 report of this year, Banking Conduct and Culture: A Call for Sustained and Comprehensive Reform, also noted this inequality of arms. The contest between the FCA and the banks is unequal, made more unequal by Clause 22. It is notable that the Government have fielded no one from the FCA to defend their proposed change. They have relied instead on Andrew Bailey, a Bank of England official.
The senior manager regime proposed by the Parliamentary Commission on Banking Standards and enacted by Parliament is there because both the commission and Parliament recognised the extraordinary failure to hold any senior manager to account. What this regime says is simply this: senior managers must show that they have behaved reasonably in doing the right thing. Senior managers must show the FCA the electronic and paper trails that demonstrate that they took reasonable action to do their jobs properly. The Government proposal scraps that. It says that the FCA must extract, if it can, this paper and electronic trail from the banks. Well, it will not be able to do that, for the same reasons that Tracy McDermott gave the Parliamentary Commission on Banking Standards in 2013.
If Clause 22 remains part of the Bill there will be no holding to account, no changes in banking culture for fear of being held to account, and no reason to expect a change in behaviour. We will be back where we started. We should remove Clause 22, and we on these Benches support this amendment.
Lord Turnbull
My Lords, looking back over the discussions on this issue, inside and outside this House, I cannot help feeling that an element of caricature has crept in. We are told that the Government have lost their nerve, caved in to bank lobbying and gone back to the failed status quo ante. At the same time, the debate has been excessively polarised, disguising the fact that there is substantial agreement on what I believe is the primary issue—tackling the problem of personal liability. The difference between us is what I think is a secondary issue: what does the reverse burden of proof add or detract from this proposal? Is this the only way in which the regime can be made to work?
The proposal in the Bill is not retracing these steps but moving forwards by introducing the SM and CR and the new concept of the duty of responsibility, which will fall on the senior managers. It tackles directly the difficulty with establishing personal liability and the Pontius Pilate defence: “It wasn’t me guv, I wasn’t there; I only read about it in the FT a couple of days ago”. That is actually true—that is what someone told the Parliamentary Commission on Banking Standards.
In future, senior managers will have to take responsibility for what goes on in the teams for which they are responsible and for the actions of the people whom they have appointed and thereby given accreditation. The code rule for senior managers says:
“You must take reasonable steps to ensure that any delegation of your responsibilities is to an appropriate person and that you oversee the discharge of the delegated responsibility effectively”.
That is absolutely clear and I still fail to see why the reverse burden of proof is the only way to get people to understand that.
Baroness Kramer
Perhaps I may ask a question of the noble Lord, Lord Turnbull. The FCA stated just over a week ago:
“The FCA may take disciplinary action against an individual where there is evidence of personal culpability on the part of that individual”.
Where does that differ from the regime before any of this is introduced?
Lord Turnbull
That is not exclusive. Elsewhere, there is still a duty of responsibility. There is still personal culpability where it can be proved, but there are many people to whom it does not apply—senior people—and, there, you will need to have recourse to the duty of responsibility to secure a “conviction”—that is, proof of regulatory breach.
Lord Hunt of Wirral (Con)
After the speeches that we have heard, particularly that of the noble Lord, Lord Turnbull, I had hoped that the noble Lord, Lord Tunnicliffe, might rise to the Dispatch Box and say, “In the circumstances, I will no longer press this amendment”. But, sadly, he has not. In declaring my interest, I say to the noble and learned Lord, Lord Brown of Eaton-under-Heywood, and the noble Lord, Lord Grabiner, that not only did I completely agree with every word they said but I thought that they made outstanding speeches.
I strongly support the extension of the senior managers and certification regime to all sectors of the financial services industry. It will create a fairer, more consistent and rigorous regime for all sectors of the financial services, enhancing personal responsibility for senior managers as well as providing a more effective and proportionate means of raising standards of conduct of key staff more broadly, supported by what we have heard during this Bill will be more robust enforcement power for the regulators.
As I have not persuaded the noble Lord, Lord Tunnicliffe, so far, perhaps I may now proceed to declare my interest as chair of the Credit Union Expansion Project and Cornerstone Mutual Services. The noble Lord did not mention credit unions, but credit unions as deposit takers are subject to the senior managers regime. I am delighted that, due to the advocacy of the Association of British Credit Unions and the support of the All-Party Parliamentary Group on Credit Unions, both the Prudential Regulation Authority and the Financial Conduct Authority have made special allowances for smaller deposit takers to apply a simplified regime in recognition of the need for proportionality. But not a word of that lies in this amendment. There are no associated amendments helping to deal with the position of credit unions.
If this amendment were to be carried, we would have the reverse burden of proof applying to managers in credit unions. Credit unions in the vast majority of cases have fully non-executive volunteer boards which are democratically elected by and drawn from a credit union’s membership. They already face significant challenges in attracting and retaining skilled and experienced individuals willing to sit on their boards on a voluntary basis. The imposition of the heightened personal responsibility which the noble Lord, Lord Tunnicliffe, would impose by removing this clause would compound and exacerbate these difficulties for many credit unions. Some larger credit unions have already begun to move away from the voluntary board model in order to attract the right people in the light of SMR and, in particular, the prospect that the noble Lord, Lord Tunnicliffe, might succeed in this amendment. There are many other reasons but, please, do not impose this level of responsibility on institutions—admittedly deposit takers—like credit unions.
We have heard all the arguments about presumption of innocence. We have the opportunity of a regime which will be tougher and fairer. Please do not let us complicate it any further by introducing a disparate, varied scheme. Let us impose this new regime, which I believe will be very successful indeed.
Lord Lawson of Blaby (Con)
My Lords, like the noble Lord, Lord Turnbull, I was a member of the Parliamentary Commission on Banking Standards. I find myself in much the same place as the noble Lord and I will not repeat, therefore, all the things he has said.
My greatest concern is that there were, sadly, in British banking examples of grotesque incompetence and irresponsibility right at the top, as has been borne out most recently in the report by the Bank of England and the PRA on HBOS. It would be hard to read a more damning indictment although, as the noble Lord, Lord Turnbull, pointed out, it does not say anything further than we said in our own report—that it was an accident about to happen—which was largely written by the noble Lord, Lord Turnbull.
In addition to this grotesque irresponsibility and incompetence, for which the then chairman and senior executives of HBOS have not been adequately penalised, in my opinion and that of the Banking Standards Commission, serious wrongdoing was widespread throughout banking—although, as we all know, not all bankers were guilty of it. What happened? Eventually, after delays, the banks were fined huge amounts of money by the appropriate financial authorities. That is not only counterproductive but is seriously against the national interest. We want banks to be adequately capitalised, both for them to be safe and to be able to lend more, particularly to SMEs. It has meant that something like £1 trillion of bank lending has not happened because of the fines the banks have had to pay.
It is not the banks that are guilty of wrongdoing but the bankers, and it is important for this change of emphasis to occur. The only people who suffer when the banks are heavily fined—apart from the small businesses which cannot get loans because the capacity is less—are the shareholders, the one group of people who are completely innocent, who have done nothing wrong. It is important to change the way in which we deal with this and get at the individuals in senior management who are responsible.
Lord Brennan (Lab)
My Lords, I support the amendment for three reasons, which I shall shortly state. First, there is a genuine and important public interest in the existing statutory system. Two years ago, this House enacted this system. It did so as the result of a government amendment, which was not opposed but agreed unanimously. The Minister speaking to the amendment, the noble Lord, Lord Newby, said that,
“the Government believe that it is in the long-term interest not only of bank customers but of the City of London that the highest possible standards are followed”.
He said that the system he was introducing,
“ensures that individuals are held to account when things go wrong”.—[Official Report, 15/10/13; col. 405.]
That is the genuine public interest that the present system protects.
Secondly, the reversal of the burden of proof is a well-recognised feature of our legal framework. It is subject to safeguards and appropriate standards, but it exists and has done for a long time. For example, the Health and Safety at Work Act covers employers large and small—a point was made about the size of credit unions—across the whole country. They have a duty to protect their workers. In fulfilling that duty they are required to show that they did all that was reasonably practicable to satisfy that duty. It is a statute that can send people, after a court hearing, to prison. That is for a crime punishable by jail; this is not that—this deals with misconduct and disciplinary proceedings. The people involved should know the system they are trying to justify and explain. The regulator is entitled to be able to run a sensible regime which does not subject his organisation and his staff to undue pressure. That is what the public want. I would ask the House this: are we seriously suggesting that that which we demand of employers for our citizens is too much to ask of bankers; namely, to protect their customers?
I turn to the third reason. Why make this change? Why have the Government, a different Government but with the same Treasury officials, committed a complete volte-face within two years and without any plausible justification, as the noble Lord, Lord Sharkey, pointed out? I suggest that, there being no plausible reason, the first thoughts of the House were the right ones and are what the public expect. We should do our best, on this kind of embarrassing occasion for the Treasury and the Government, to protect them from this intellectual disarray and to make sure that the House itself does not fall into the legislative embarrassment of telling the nation one year, “This is how we will protect you”, and two years later saying exactly the opposite. For these three reasons, this amendment should be carried.
Lord Pannick (CB)
My Lords, I think we all agree that to impose a reverse burden of proof on a person to establish their innocence of a disciplinary offence requires a strong justification. It is required not only by elementary fairness; it is also required by law, as the noble and learned Lord, Lord Brown, indicated. This is a criminal matter for Article 6 purposes because a disciplinary offence is regarded, by our courts and by Strasbourg, as a criminal matter if sanctions are imposed. So the question is this: what is the justification?
I have listened carefully to the debate to try to understand the justification being put forward, and it appears to amount to this. It will be difficult to prove a failure to comply with the new duty to take reasonable steps. That is the concern, but I do not understand it. The regulator has considerable investigative powers which enable it to obtain all the relevant evidence on whether a senior manager has complied with the new duty to take reasonable steps. If there is no document trail, which is the concern mentioned by the noble Lord, Lord Sharkey, in his contribution, the regulator will rely precisely on that in establishing a failure to take reasonable steps. The banker, even if he has the assistance of the noble Lord, Lord Grabiner, acting for him, will be found guilty of the disciplinary offence of failing to take reasonable steps, and rightly so. That is the appropriate way to change a culture—a matter to which the noble Lord, Lord Tunnicliffe, and the noble Baroness, Lady Kramer, rightly referred. You change a culture by ensuring that the regulator brings a proper disciplinary charge; you do not change a culture by introducing an unfair regime.
The noble Lord, Lord Sharkey, said that the battle between the FCA and the bankers is unequal. This is a problem across the legal field in relation to prosecution authorities, but the answer is to ensure that the FCA has adequate resources; the answer is not to introduce an unfair regime. I do not think that the case for a reverse burden has come close to being made out. The strong justification has simply not been established.
Lord McFall of Alcluith
My Lords, I wish to speak up for the Parliamentary Commission on Banking Standards. Some of my colleagues seem to be disappearing like snow off a dike on a hot July day, but I want to be faithful to the strictures of the parliamentary commission. We took two years over the examination and we asked 10,000 questions. When the Financial Services (Banking Reform) Act was passed in 2013, all of us were satisfied with seeing our measures enshrined in legislation. But now, 18 months later and with no opportunity to test it, the legislation has been filleted, particularly in relation to the reverse burden of proof.
I have just returned from a conference in Washington attended by regulators from the Federal Deposit Insurance Corporation, the Commodity Futures Trading Commission and the Office of Financial Research. They said that progress has been made, but the task ahead in terms of a global resolution for the financial regime is enormous: resolution plans, living wills, leverage ratios, counterparty clearing houses, cross-border co-operation, and not least public resolution mechanisms which do not fit in well with domestic insolvency regimes. Why am I mentioning these? It is because the message also given to me during those conversations was that there is not enough push-back. The momentum goes one way globally, in favour of Wall Street and the banks. In an environment with low interest rates and disappointing returns, it is inevitable that banks will take more risks in the future. So there is a need for vigilance to minimise regulatory arbitrage and change the culture in order to minimise misbehaviour, which was the essence of the parliamentary commission.
We have been talking about the reverse burden of proof, but is it that? Section 32 of the 2013 Act could be interpreted as not a reversal of the burden of proof, because it means that the defendant is considered to be automatically guilty, and she or he has to prove their innocence. That is not going to happen in this case. The present position is that a senior manager will be liable for misconduct if a variety of factors are present, including the absence of reasonableness in breaching a regulatory rule. That does not constitute a reversal of the burden of proof. It means that the regulator must still show that all the factors in Section 66 are present, and then the defendant will be required to demonstrate the defence of having acted reasonably. There is nothing unusual about the regulator having to prove the elements of an offence or misconduct and then the defendant having to prove a statutory defence to that liability. Indeed, the government amendment could have the odd effect of requiring the regulator to prove the defence. But that is for the senior manager to do, and he or she must prove that their work was reasonable.
Perhaps the test of reasonableness is too low because a senior manager need only point to a lack of diligence on the part of other senior managers to demonstrate that they appear to be reasonable as compared with their peers. I would prefer “reasonable diligence”; indeed, I would have preferred the duty of care, which I proposed to the Parliamentary Commission on Banking Standards, saying that it would be simpler and could not be misinterpreted, but it was not taken up, and that is why we find ourselves in this position today.
The real regulatory challenge is to make sure that senior managers manage their institutions properly from top to bottom so that none of their employees can misbehave. In the intervention made just previously to my own, mention was made of the regulator ensuring the best regulation and that companies undertake it. I can well remember Tracey McDermott, then the director of the FSA, coming before the commission to be questioned about UBS, where one of its clients had misappropriated $2 billion. When we asked the senior managers about it, they said that they did not know the client. When we asked them when they found out, they said, “It was on the Bloomberg news wires”. When we asked Tracey McDermott why she did not pursue it, she said, “The trail went cold”. The trail is going to be cold here, and we will still have to fix this problem.
Is it not ironic that Sports Direct knows when someone steals a pair of socks, but Barclays cannot spot millions of pounds being taken through misquoting LIBOR? That is the situation we are facing. The real issue is the quality of regulation. We have ducked it tonight, but perhaps my fellow commissioners will come back in two years’ time and say, “We have had another thought, and what we have passed tonight was not very good, so let us have another go”. There is a pregnant agenda here and we will have to attend to it.
Lord Bridges of Headley
My Lords, this amendment has led to a very interesting debate. I would like to pick up on what the noble Lord, Lord McFall, said, and remind the House of the context. As he so well knows, and everyone here will remember, seven years ago, the world was engulfed by a financial crisis, triggering a deep recession. It was a crisis caused, in part, by the reckless actions of some bankers and it was a crisis which our regulatory system failed to prevent. Today, we are all still paying the price for it and we are still hearing cases of crimes and misdemeanours in our financial services, as my noble friend Lord Lawson mentioned.
Although a number of banks have paid eye-watering fines for their misdemeanours, it is wholly unacceptable that so few bankers have themselves been held to account for their wrongdoings. The current regime, the approved persons regime,
“has created a largely illusory impression of regulatory control over individuals, while meaningful responsibilities were not in practice attributed to anyone. As a result, there was little realistic prospect of effective enforcement action, even in … the most flagrant cases of failure”.
These are not my words but those of the Parliamentary Commission on Banking Standards. The Government are absolutely clear that this has to change.
Our regulatory system needs to be able to hold individuals—I repeat, individuals—and not just banks to account for misconduct or recklessness, a point that the noble Lord, Lord McFall, rightly made in Committee and my noble friend Lord Lawson echoed. More than that, regulation needs to deter misconduct and recklessness in the first place. Good regulation is a spur for good behaviour and, as such, is crucial to driving the cultural change in the industry which we all want.
What are the characteristics of such a regulatory regime? It is one in which individuals’ responsibilities are crystal clear. It is one where individuals cannot shirk responsibility for their actions or those of their employees. Tasks may be delegated, but never accountability. A good regime is a regime where ignorance is no excuse. It is a regime where there are strong, simple principles that guide people’s conduct. Above all, it is a regime in which all senior managers understand that if something goes wrong in their team—be it a team of 20 or 20,000 —or on their watch, they will be held individually accountable. That is a good regulatory regime. Are these the features of the current approved persons regime? They are not but they are the hallmarks of the new senior managers regime that we will implement. As the noble Lord, Lord Grabiner, eloquently argued, the new regime will be tough and it will help to change the culture across the financial services industry for the better, which is what the noble Lord, Lord Tunnicliffe, desperately wants.
I am aware that there are concerns that the replacement of the reverse burden of proof with a statutory duty of responsibility will leave us in the same position as under the approved persons regime, where it can be very difficult, as I have said, for the regulators to hold senior management to account. I can reassure your Lordships that this is simply not the case. Let me set out exactly how the new regime will deliver a step change in senior manager accountability. First, the clarity of responsibility which has been so desperately lacking under the approved persons regime will be embedded in the system. This will be achieved in a number of ways.
An application by the firm for approval of a senior manager must be accompanied by a statement of responsibilities setting out what the senior manager will be responsible for managing in the firm. This must be updated if the responsibilities of a senior manager change. That ensures that both regulators and the firm will have the necessary clarity about who is responsible for what, and senior managers will take full ownership of their respective areas of responsibility.
This requirement is bolstered by the regulators’ rules, which require each firm to have, and to submit to the regulators, a “responsibilities map” setting out how responsibility for the business of the firm as a whole is allocated amongst its senior managers. This minimises the risk of any responsibilities falling through the cracks between different senior managers. On top of that, under rules of conduct made by the regulators, it is made clear that a senior manager must take all reasonable steps to ensure that any delegation of their responsibility is to an appropriate person, and they must oversee the discharge of any delegated responsibilities effectively.
Secondly, tough rules will apply to the senior managers. A senior manager can now be found guilty of misconduct if a breach of regulations occurs in the area of the firm’s business for which they are responsible and if they did not take such steps as a person in their position could reasonably be expected to take to prevent it. Crucially, it does not matter whether or not the senior manager is aware of the regulatory breach. Ignorance is no defence. What matters is whether they have taken reasonable steps to prevent the breach. If they have not, they are guilty of misconduct. They will not be able to avoid liability simply because the email trail has gone cold. The regulator will not—I repeat, not—be completely stymied if all conversations and exchanges take place in an environment where there are no minutes, no emails, no memos and no existing trail.
Indeed, as the noble Lord, Lord Pannick, said, the very fact that there is an absence of such an email trail, and that a senior manager is totally unaware of what is going on in an area of the firm for which they are responsible, may very well suggest that they have been guilty of failing to take reasonable steps to prevent a breach of regulations. This is the new system we are introducing and the Bill before Parliament does not change any of what I have just said. The measures in this Bill do not take us back to the days before the financial crisis.
Noble Lords need not take my word for it. According to Andrew Bailey, deputy governor for Prudential Regulation and chief executive officer of the Prudential Regulation Authority, the introduction of the statutory duty of responsibility, instead of the reverse burden of proof,
“makes little difference to the substance of the new regime. Once introduced, it will be for the regulators (rather than the senior manager) to prove that reasonable steps to prevent regulatory breaches were not taken. This change is one of process, not substance”.
Furthermore, the removal of the reverse burden of proof does not change the penalties which can be applied. If found guilty of misconduct under the statutory duty of responsibility, a senior manager could face an unlimited fine and/or prohibition from working in the industry. All this means that situations where things go wrong because of irresponsible, reckless or negligent management by a senior manager will be less likely to occur in future, because of the strong deterrent effect of the statutory duty of responsibility. If they do occur, the regulators will be much better equipped to take action against senior managers who have mismanaged the firm.
To those who would still like to keep the reverse burden of proof, I would say this. First, Andrew Bailey has highlighted to the Treasury Select Committee in the other place that the way banks are starting to prepare for the introduction of the reverse burden of proof next March is unhelpful. We understand that some of their legal advisers are being asked to prepare checklists, as the noble Lord, Lord Tunnicliffe, said, of “reasonable steps” which their senior managers should follow. I would say to the noble Lord that the point about checklists is this: presenting evidence that a template or checklist had been followed could enable the senior manager to meet the burden of proof for the defence, but would leave the regulator to prove that the steps taken were not reasonable.
In practice, the reverse burden of proof would not give the regulator a significant advantage but could sow the seeds of a new tick-box culture. The reverse burden of proof will add no significant weight to the regulators’ powers of enforcement, but instead risks creating a great deal of lucrative work for City lawyers. Secondly, the Government are expanding, as has been said, the senior managers and certification regime so it covers all authorised financial services firms, the majority of which are small. The tick-box culture I have described risks leading to the perverse outcome whereby senior managers in the largest firms are less exposed to legal risk under the reverse burden of proof, thanks to being able to employ the best lawyers and compliance officers.
I have been pressed on why the Government cannot introduce a two-tier system, with the reverse burden of proof applying to deposit takers but not to other firms. First, I have described the potential for detrimental effects on small firms. These issues are also relevant for small deposit-takers—for example, small building societies and credit unions, the latter often relying on volunteers for their staff. This approach would also raise serious issues of cross-sectoral competition. Noble Lords on all sides want a vibrant, innovative financial services industry that offers high-quality, good-value products to consumers. To achieve that, the regulatory system must, as far as possible, deliver a level playing field to support competition.
A reverse burden of proof that applied only to the banking sector would undermine this. For example, both deposit-takers and non-deposit-takers can engage in mortgage advice. A small building society or bank, for which the reverse burden of proof would apply, engaged in direct competition with firms, for which it would not apply, could find it more difficult to attract key members of staff. There could be a particular issue for challenger banks, especially those seeking authorisation for the first time.
Legitimate questions of fairness would also be asked about why senior managers in deposit-takers, particularly small ones, should be subject to the reverse burden of proof while those in firms such as large insurers or investment firms, which may pose greater risks to positive consumer outcomes and market integrity, are not. This approach would also create a great deal of complexity in large groups that contain firms which have deposit-taking permissions and firms that do not.
So, introducing a two-tier regime would introduce unnecessary complexity, when we have a tough, fair and practical alternative—the statutory duty of responsibility —that can be applied consistently to all firms. This is why the Government do not believe it appropriate to retain the reverse burden of proof. Is it needed to prove a senior manager culpable for a misdemeanour? No. Is it needed to clarify responsibilities of individuals in firms? No. Is it needed for the regulator to prosecute a senior manager if the email trail goes cold? No. Is it the silver bullet that will make the individuals who manage our banks responsible for their actions? No.
Instead, as I have explained, the new regime, with its statutory duty of responsibility, is a formidable tool for holding senior managers to account and for changing behaviour and culture in banks and across the entire financial services industry—a change we and the British public so very much want. I therefore ask the noble Lord to withdraw his amendment.
Lord Tunnicliffe
My Lords, I am conscious that there are two possible tests for deciding when to bring a debate to a conclusion. One is when all arguments have been exhausted, the other when there are no minds left to change. I suspect that the second test is the more acute one, therefore I will be brief.
Many noble Lords have taken part in the debate. In many ways I do not need to answer the points, in that it has been a balanced debate and points have been contested across the House. I am particularly grateful to those noble Lords who agreed with me; I am less enthusiastic about those who disagreed with me. A particular point raised was the matter of human rights. I counter that with the point that the noble Lord, Lord Deighton, affirmed that this part of the Bill is compatible with the regime.
I thank the noble Lord, Lord Sharkey, for speaking in support of my position and, in particular, for bringing out in how many areas the reverse burden of proof is in our law. It is not common, but it is there in particular cases.
I note the point made by the noble Lord, Lord Hunt, on credit unions. In my speech I made the point that we were willing to enter conversations with the Government so that they could come forward at Third Reading with a sensible carve-out from the overall effect. I plead with the noble Lord—he may remember way back when he was in opposition—that we have modest resources. Putting together a series of sensible additions to do the carve-out would not be sensible. We are very happy to agree carve-outs with the Government.
I thank my noble friend Lord Brennan for once again reminding us of the Health and Safety at Work etc. Act 1974. That is one of the most outstanding pieces of legislation in the British system. Its impact on safety in this country has been phenomenal. I and many managers in this country have laboured under the reverse burden of proof that that Act brings. The reverse burden of proof can be the right thing to do and has proved so in safety. We believe that it would prove so here.
The noble Lord, Lord Pannick, said that we have not brought out sufficient justification. He says that it is difficult to prove. No: it has so far proved impossible. I thank my noble friend Lord McFall for reminding him, us and fellow commissioners of how forcefully they supported the reverse burden of proof in their report—I have pulled out extracts but I will not take up the time of the House and read them.
Lord Ashton of Hyde
“( ) Regulations under subsection (3) may make the provision mentioned in subsection (6)(c) only with the consent of the Council of Lloyd’s.”
Lord Ashton of Hyde
My Lords, this may not be quite so interesting. Clause 26 will introduce a power into the Financial Services and Markets Act 2000 for the Treasury to make regulations relating to transformer vehicles. Transformer vehicles are used for risk mitigation purposes, particularly in connection with insurance-linked securities business.
Lloyd’s is an important part of the London insurance market. The clause enables the regulatory arrangements of Lloyd’s to be updated, should that be needed to facilitate the Lloyd’s market adapting to insurance-linked securities business and the use of transformer vehicles. If this requires amendments to the Lloyd’s Acts, or makes other provision unique to Lloyd’s, new subsection (10) ensures that the regulations will not be treated as a hybrid instrument, so that amendments are not delayed in Parliament by the hybrid procedure.
During Committee stage, the Delegated Powers Committee considered this clause and reported that the power conferred was,
“adequately explained and justified in the memorandum”.
However, the committee raised a concern about the disapplication of the hybrid procedure, particularly in relation to regulations conferring functions on the Council of Lloyd’s. The committee pointed out that the purpose of the hybrid procedure is to protect private interests and recommended that the clause be amended,
“so that the power in subsection (6)(c) may not be exercised without the consent of the Council of Lloyd’s”.
The Government have considered this recommendation carefully and agree with the committee’s recommendation. Therefore, this amendment qualifies the power in new subsection (6)(c) to make regulations relating to Lloyd’s so that the power can be exercised only with the consent of the Council of Lloyd’s. I beg to move.
Lord Davies of Oldham
My Lords, the Government received good advice from the Delegated Powers Committee. I am surprised that they deliberated for a period before reaching the right conclusion—that is, agreeing with the committee.
Lord Bridges of Headley
“In subsection (2)(a)—
(a) references to a member, or a survivor of a member, of a pension scheme include a member, or a survivor of a member, of a pension scheme for which the PPF has assumed responsibility under Part 2 of the Pensions Act 2004 or Part 3 of the Pensions (Northern Ireland) Order 2005 (S.I. 2005/255 (N.I. 1)), but(b) in relation to such a member or survivor, the reference to the flexible benefits that may be provided is to be read as a reference to the money purchase benefits (within the meaning of that Act or that Order) that may be provided by the PPF by virtue of sections 161 and 170 of that Act or articles 145 and 154 of that Order.(2B) ”
Lord Bridges of Headley
My Lords, this group makes several small pensions amendments, which I shall highlight briefly.
The first amendment is technical in nature and closes an unintended gap in guidance provision, ensuring that people in the Pension Protection Fund—the PPF—are able to access Pension Wise guidance. At present, Pension Wise is able to provide guidance only to a member, or the survivor of a member, of a pension scheme. As the PPF is a compensation fund, not a pension scheme, individuals whose schemes have transferred into the PPF are not able to obtain guidance from Pension Wise.
Where a defined benefit scheme transfers to the PPF, usually following the sponsoring employer becoming insolvent, it is possible that any money purchase benefits which a scheme member has built up, most likely as a top-up to their defined benefit scheme, could also transfer in. The amendment will allow these members to receive guidance on options around what to do with their money purchase benefits. Pension Wise should be available to all who wish, and are able, to take advantage of the pension freedom reforms, and it is right that we are taking action now to ensure that all are treated consistently.
Next is a series of amendments that make changes to Clauses 27, 30 and 32. These ensure that powers currently given to the Treasury will be given instead to the Secretary of State. This is so that when oversight of Pension Wise moves to the Department for Work and Pensions, my right honourable friend the Secretary of State for Work and Pensions will be able to exercise this power.
I turn finally to the amendment creating a new clause. This amendment is technical in nature and allows appointed representatives of authorised financial advisers to advise on the conversion and transfer of safeguarded benefits, which are the special valuable features of certain pensions, such as defined benefit pensions and pensions with guaranteed annuity rates, for the purposes of the advice safeguard established in Sections 48 and 51 of the Pension Schemes Act 2015.
These amendments to Sections 48 and 51 of the Pension Schemes Act 2015 will amend the definition of “authorised independent adviser” to include appointed representatives. As a result, they will be able to give appropriate independent advice to satisfy the advice safeguard. They will also amend the Financial Services and Markets Act 2000 (Appointed Representatives) Regulations 2001 to the same end. Around two-thirds of financial advisers are appointed representatives who have a special contract to provide services on behalf of their principal, who will be an authorised financial adviser regulated by the FCA. This measure puts the eligibility of appointed representatives to advise on these transactions beyond doubt.
The amendment extends eligibility to advise on these transactions only to the appointed representatives of financial advisers. What this will not do is reduce consumer protections or weaken the accountability of financial advisers, or their appointed representatives. Where an appointed representative advises on these transactions, the directly authorised firm, as the principal, takes full responsibility for the quality of the advice and compliance with FCA rules.
The pension freedoms which came into effect in April have given people real freedom and choice in how they access and spend their income at retirement. This amendment will help to ensure that they operate as intended for customers with safeguarded benefits. I beg to move.
Lord Bridges of Headley
“( ) In subsection (3) after the definition of “pension scheme” insert—
““PPF” means the Board of the Pension Protection Fund;”.”
Lord Bridges of Headley
“Advice about transferring or otherwise dealing with annuity payments
(1) The Financial Services and Markets Act 2000 is amended as follows.
(2) After section 137FB insert—
“137FBA FCA general rules: advice about transferring or otherwise dealing with annuity payments
(1) The FCA must make general rules requiring specified authorised persons to check that an individual—
(a) who has a right to payments under a relevant annuity, and(b) if the Treasury make regulations under subsection (3), who is not an exempt person by virtue of those regulations, has received appropriate advice before transferring or otherwise dealing with the right to those payments.(2) The reference in subsection (1) to a right to payments under a relevant annuity does not include a contingent right to such payments.
(3) The Treasury may by regulations provide that an individual whose financial circumstances meet criteria specified in the regulations is an exempt person for the purposes of subsection (1)(b).
(4) Regulations made under subsection (3) may (amongst other things) specify criteria based on the proportion of the individual’s financial resources that is represented by the payments under the relevant annuity or the value of that annuity.
(5) The rules made by virtue of subsection (1) may include provision—
(a) about what specified authorised persons must do to check that an individual has received appropriate advice for the purposes of those rules;(b) about when the check must be carried out.(6) For the purposes of this section—
(a) “relevant annuity” means an annuity specified (by type, value or otherwise) as a relevant annuity in regulations made by the Treasury;(b) “appropriate advice” means advice specified (by reference to the person giving the advice or otherwise) as appropriate advice in regulations made by the Treasury;(c) “specified authorised person” means an authorised person of a description specified in rules made by virtue of subsection (1).(7) If regulations under subsection (3) or (6)(a) make provision about the value of an annuity, the regulations may also make provision about the basis on which the value of an annuity is to be calculated.”
(3) In section 138F(2) (notification of rules) after “137FB,” insert “137FBA,”.
(4) In section 138I (consultation by the FCA)—
(a) in subsection (6), after paragraph (aa) insert—“(ab) section 137FBA;”;(b) in subsection (10)(a) after “137FB,” insert “137FBA,”.”
Lord Bridges of Headley
My Lords, this amendment introduces an advice requirement for some of those consumers who wish to sell their annuity income streams on the secondary market.
We have already debated the extension of Pension Wise, enabling it to offer guidance for consumers in this market. The Government recognise the importance of protecting all who have a right to receive an income under a relevant annuity, not just the primary annuity holder, and this has been a concern raised by noble Lords previously. That is why we can clarify that we will be making the free and impartial Pension Wise guidance service available to anyone with a relevant interest in a relevant annuity.
Today, the Government are introducing a new measure to ensure that consumers are adequately supported when making the complex decision of whether to sell their annuity income streams. A regular income stream from an annuity is a valuable asset and, for the majority of individuals, it will be in their best interests to keep their annuity. Therefore, it is important that annuity holders understand the value of their income stream and are informed about the options available to them.
The Government have consulted on the steps that should be taken to support consumers with this complex decision. In addition to Pension Wise guidance, we asked whether consumers should be required to take financial advice in order to receive a tailored recommendation to inform their choices. We also asked whether the safeguards in place should vary depending on the value of an annuity to ensure that consumers with lower value annuities do not have to pay disproportionately high costs in order to sell them. There was broad support from both industry and consumer groups for requiring advice above a threshold. The Government have listened and are putting this measure in place through a government amendment to this Bill today.
This proposed new clause will place an obligation on the Financial Conduct Authority to make rules requiring certain authorised firms to check that advice has been received before annuity holders may sell their annuity income stream. The FCA will determine which businesses will be required to make these checks, what the checks will entail and when they will be carried out. We expect that the FCA will be consulting on its proposed rules during 2016.
The threshold for advice, including how it will be calculated, will be set out by government through secondary legislation. The Government will also lay secondary legislation to specify what type of advice individuals must have received. In specifying appropriate financial advice, the Government’s intention is to require advice to be FCA-authorised and regulated. The Government also intend to legislate that all UK buyers in the secondary market for annuities will be FCA-regulated. This will allow the FCA to design specific rules governing the conduct of both financial advisers and buyers in this market, and the Government will work with the FCA to consider any conflicts of interest that may arise between these parties. The Government are engaging with financial advisers and their representative bodies with the aim of ensuring that there will be enough participating advisers to meet consumer demand when the market opens. Within the financial advice market review, the Government are considering how the availability of financial advice can be improved, particularly for those who do not have significant income or wealth. The review is to publish its recommendations by the time of Budget 2016, and the Government will ensure that the financial advice requirement in the secondary annuities market fully reflects the outcomes of this review.
A further power will allow the Treasury to exempt from this advice requirement those individuals whose financial circumstances meet certain criteria. The Delegated Powers and Regulatory Reform Committee has recently recommended that this power be affirmative rather than negative, and the Government will respond to the House on this recommendation at the earliest opportunity. The Government will consult on the regulations to be made under all powers afforded by this clause in 2016.
Today’s debate coincides with the Government’s publication of their response to the March 2015 call for evidence on the creation of a secondary market for annuities. This sets out the wider set of proposals around, and the next steps for, the implementation of the secondary market. The response gives further detail on how the market will operate, including tax considerations as well as further details on the consumer support framework, part of which the Government are legislating for in this Bill. Your Lordships will no doubt be minded to consider the wider policy in today’s discussion, and your views on these proposals are welcomed. I beg to move.
Baroness Drake (Lab)
My Lords, I refer to my entry in the register of interests, in particular my membership of the board of the Pensions Advisory Service. I am also on the Delegated Powers Committee.
There is no pre-existing secondary annuity market which can inform an assessment of whether it would be a well-functioning market, what the key risks are or what is an appropriate level of consumer protection. I have had little time to digest the Government’s response to the consultation on this market, published today, but up to 5 million people could participate in this market—although interestingly, the Pensions Minister and the Economic Secretary both advise that for the vast majority of customers, selling an annuity will not be the best decision. There is a real tension in the policy on this secondary market. The Government have to ensure a robust consumer protection regime consistent with their asserted view, which I do not disagree with, that the right decision for most people is to retain their annuity. At the same time, an effective market needs a sufficient level of demand from consumers to sell their annuities and a sufficiently wide range of purchasers. These two requirements do not sit easily with each other.
While it is welcome that the Government are taking further steps through their Amendment 25 to protect the consumer, I have real concerns about the sufficiency of those protections. The Government will now also allow the original issuers to buy back annuities. This will be allowed only indirectly when facilitated through a regulated intermediary, such as a broker or financial adviser—presumably to enhance consumer prospects of a better deal—although annuity providers can still buy back low-value annuities directly. That raises several issues. What will be the threshold at which direct buyback of low-value annuities will be allowed? How will this be measured—by income stream, by income stream in relation to the individual’s financial resources or by the annuity’s value on the secondary market? Indirect buyback through an intermediary will mean an extra layer of costs for consumers, paying in effect for their own protection. How will the Government control those costs?
As individuals will be required to take advice, how will the Government ensure that advisers are willing to provide advice at a reasonable charge, particularly to those with modest value annuities? This is a problem under the required advice regime for individuals transferring defined benefit assets to defined contribution arrangements, so similar problems are certain to arise in a secondary annuity market. Will sufficient brokers enter that market to enable a fair price? Allowing buyback, directly or indirectly, must increase the risk of consumer inertia as individuals choose to stay with their original provider, notwithstanding any advice that they receive, heralding a weak demand size which is already so common in the pensions and annuities market. The Government intend to bring forward legislation to create a further regulated activity for buying back an annuity. What is the timetable for that legislation and will we have time to consider it properly?
Lord McKenzie of Luton
My Lords, I will speak briefly to Amendment 25. I thank the noble Lord, Lord Bridges, for his courtesy in organising a meeting with officials and for his helpful letter of 14 December. Having said that, I am bound to say that it is not helpful to receive the Government’s response to their consultation on the secondary annuity market just this morning, particularly given that the consultation closed on 18 June—six months ago. This is simply not the way to make good legislation and I look to the Minister to undertake that we will have the opportunity to return to this matter at Third Reading, should our further examination of the government response identify issues which raise concerns.
Clause 27, together with Amendment 25, provides a broad framework for aspects of the secondary annuity market, but much is left to regulation: relevant annuities, relevant interests, exempt persons, criteria determining the proportion of a person’s financial resources and appropriate advice. Yet more will be dealt with via FCA rules, although I understand that this will be subject to consultation in 2016. We are clearly not going to be able to see even draft regulations by the time the Bill leaves this House, and although the government consultation response fills in some of the blanks, there is still much that is unknown. My noble friend Lady Drake has pressed the recommendation that at least the regulations concerning exempt persons should require the affirmative procedure, as recommended by the Delegated Powers and Regulatory Reform Committee. Like my noble friend I would press that matter on the Minister and hope that he will respond positively.
If there is to be a secondary market in annuities, we agree that as well as extending Pension Wise to provide free and impartial guidance to those with a relevant interest in an annuity there should be a requirement to seek financial advice before such annuities can be sold. A particular bone of contention is the protection of dependants and beneficiaries, an issue which, as my noble friend said, impacts disproportionately on women. Although this is acknowledged in the government response, they are simply asking the FCA to consider whether a requirement could be placed on the annuity provider to ensure the dependant or beneficiary of an annuity has consented to an assignment and to consider further rules for consumers with vulnerable characteristics. The Government are also passing to the FCA consideration of the challenges arising from their being unnamed beneficiaries. It will be important for there to be clarity on these matters by April 2017. What will happen if there is not?
It appears that the Government are not going to prohibit the assignment of an annuity for those on means-tested benefits, as my noble friend said, or for those meeting social care costs, but will look to changing guidance to help people understand the deprivation of income and capital rules. Perhaps the Minister might say more, given the complexity of these issues, about how robust this consumer protection will be.
It would seem that the secondary market will not be without its complications: there will be individual annuity holders; there may be beneficiaries and dependants; there will be purchasers of rights of an annuity under a specific regulated activity; there will be a further regulated activity for providers buying back annuities; there will be regulated intermediaries; there will be IFAs providing mandatory regulated advice; and there will be authorised entities to check that holders of a relevant annuity have received appropriate financial advice. Given this plethora of parties, how confident is the Minister that conflicts of interest can in practice be avoided? Where are the costs of all of this going to fall? Who, in particular, is going to meet the costs of an authorised entity checking to see that appropriate financial advice has been received? These arrangements also of course mean that the annuity providers will be under no obligation to permit assignment of annuity payments in the first place.
The Government appear, again as my noble friend said, to have changed their mind on allowing providers to buy back their annuities through intermediaries. Can the Minister say more about how the originally perceived consumer detriment of this is to be managed? The Government do not seem to have resolved some of the basic operational issues. What is their current position on maintaining a central death register?
The Government will not restrict any entities from purchasing on the tertiary market, nor do they seem minded to place restrictions on buyers’ abilities to reassign annuities once purchased. However, they are looking at preventing UK retail investors from purchasing rights under annuities that are reassigned on the tertiary market, to protect them from a complex financial product. We would agree with that approach. It seems that the prospect of securitisation or unbundling in the tertiary market leaves scope for the tax planners.
The consultation response states that the Government want the secondary market for annuities to be fair, simple to understand, cost effective and operationally deliverable. It is clearly a long way from that. There are a host of issues still to settle but none more important than the protection of consumers. All of this is in circumstances where the Government expect that, for most annuity holders, continuing to hold the annuity income will be the right decision. I am not sure where this will all end up but we will not, for the time being, oppose this amendment.
Lord Davies of Oldham
My Lords, I am not here to pile Pelion upon Ossa. I counted that at least 12 questions of considerable complexity have been addressed to the Minister, and all of them are important. My two noble friends have of course reflected the considerable anxieties on this side with regard to the position with pensions, particularly for secondary annuities. I hope the Minister will do his level best to respond to real questions that need to be addressed, which would also minimise the amount of time we will need to spend at Third Reading on the issue.
Lord Bridges of Headley
I start by thanking the noble Baroness, Lady Drake, and the noble Lord, Lord McKenzie, for sparing the time to meet me and officials last week. I will also say now that I apologise for the timing on these things. I will not try to give a “dog ate my homework” excuse—these things are sometimes just unfortunate—and I heed what the noble Lord, Lord McKenzie, has to say about the timing of the report. I make no commitments right now about Third Reading, but I am happy to meet both the noble Lord and the noble Baroness, Lady Drake, and will answer a number of the points that have been raised. As the noble Lord, Lord Davies, said, some were pretty technical, so I hope noble Lords will forgive me if I do not cover them all, in which case I will write as soon as I possibly can with detailed answers.
To start, the noble Baroness, Lady Drake, spoke of the tension in the policy. All I would say in response is that many of the responses to the consultation welcomed the proposal to extend the pension freedoms to those who had already bought an annuity. As the Government have always made clear, for many people, an annuity, which provides a guaranteed income for life, will remain the right choice. However, the Government believe that there is no reason why they should impose barriers that prevent individuals being free to make their own decision about what to do with their annuity rights, purchased with the money they have saved throughout their working life.
Lord Bridges of Headley
“Independent advice on conversions and transfers of pension benefits: appointed representatives
(1) The Pension Schemes Act 2015 is amended as follows.
(2) In section 48(8) (independent advice in respect of conversions and transfers: Great Britain), in paragraph (a) of the definition of “authorised independent adviser”, after “Secretary of State,” insert “or is acting as an appointed representative (within the meaning given by section 39(2) of that Act) in relation to a regulated activity so specified,”.
(3) In section 51(8) (independent advice in respect of conversions and transfers: Northern Ireland), in paragraph (a) of the definition of “authorised independent adviser”, after “Northern Ireland,” insert “or is acting as an appointed representative (within the meaning given by section 39(2) of that Act) in relation to a regulated activity so specified,”.
(4) The Financial Services and Markets Act 2000 (Appointed Representatives) Regulations 2001 (S.I. 2001/1217) are amended as follows.
(5) In regulation 2(1) (descriptions of business for which appointed representatives are exempt) after sub-paragraph (cca) insert—
“(ccb) an activity of the kind specified by article 53E of that Order (advising on conversion or transfer of pension benefits);”.(6) In regulation 3 (requirements applying to contracts between authorised persons and appointed representatives) after paragraph (3G) insert—
“(3GA) A representative is also to be treated as representing other counterparties for the purposes of paragraph (1) where the representative gives advice (in circumstances constituting the carrying on of an activity of the kind specified by article 53E of that Order) on behalf of other counterparties.”(7) The amendments made by subsections (4) to (6) do not affect the power to make further subordinate legislation amending or revoking the amended regulations.”
Lord Ashton of Hyde
“Financial Services and Markets Act 2000 (Consequential Amendments and Repeals) Order 2001
(1) The revocation of the Financial Services and Markets Act 2000 (Consequential Amendments and Repeals) Order 2001 (S.I. 2001/3649) by the National Savings Regulations 2015 (S.I. 2015/623) is to be treated as never having had effect.
(2) Accordingly, in the Schedule to those regulations, omit the entry for that order.”
Lord Ashton of Hyde
My Lords, the amendments in this group are being made to correct an error made in the National Savings Regulations 2015. Those regulations revoked a number of statutory instruments with effect from 6 April 2015. By mistake, these included the Financial Services and Markets Act 2000 (Consequential Amendments and Repeals) Order 2001, which I will refer to as the 2001 order.
The 2001 order, which was revoked, was used to make most of the consequential amendments and repeals that were required to give effect to the Financial Services and Markets Act 2000. It amended a range of primary and secondary legislation, including the Companies Acts, the Bank of England Act 1998, the Building Societies Act 1986, the Pensions Acts and other legislation related to financial services.
In some cases, the amendments made by the 2001 order have been superseded by subsequent legislative developments, but in many cases they are still necessary, and the repeal of the instrument making them has left the law in a state of considerable uncertainty.
The only way in which this regrettable uncertainty can be cured is for the revocation of the 2001 order to be cancelled out. That is what the amendments do. Amendment 27 provides that this revocation shall be taken as never having had effect. This amendment would have retrospective effect. We do not believe anyone would be adversely affected by the amendment. On the contrary, the law will be assumed to be as it was in force before the accidental revocation of the 2001 order. This amendment will restore the law to what it is presumed to be.
To sum up, the 2001 order was and still is necessary. It was accidentally revoked in the National Savings Regulations 2015. The amendment is cancelling that relocation ab initio so that the 2001 order will still be in force.
The second amendment, Amendment 30, will ensure that the first amendment is brought into force on Royal Assent. This ensures that we can restore legal certainty as soon as possible and limits the degree of retrospection involved.
I beg to move.
Lord Davies of Oldham
My Lords, I have seen some responses of a technical nature from Governments in the past which have brought some wry amusement, but I think the noble Lord has hit a new high on this occasion.
According to my notes, and I hope I am reflecting exactly what he said, to ensure legal certainty, the revocation is treated as never having had effect. We are getting to the end of this part of the Bill—and probably not before time.
Lord Ashton of Hyde
( ) The appropriate Gazettes are the London Gazette and—
(a) if the part of the United Kingdom specified under subsection (1)(b) is Scotland, the Edinburgh Gazette;(b) if the part of the United Kingdom specified under subsection (1)(b) is Northern Ireland, the Belfast Gazette.”
Lord Ashton of Hyde
Finally, my Lords, this amendment implements a recommendation of the Delegated Powers Committee made in relation to Clause 29 in its 11th report.
The clause permits the Treasury to make regulations authorising a bank to issue banknotes in Scotland or Northern Ireland in place of an existing issuer in the same group. The designation date on which the authorisation of the new issuer takes effect and the authorisation of the existing issuer ceases must either be set out in the regulations or published by the Treasury in accordance with the regulations.
The Delegated Powers Committee noted:
“A similar arrangement is allowed for in the Bank of Ireland (UK) plc Act 2012, but that obliges the board of the Bank of Ireland (UK) to publish notice in the London Gazette and the Belfast Gazette of the day appointed, and to do so before that day”.
The Delegated Powers Committee recommended that an equivalent requirement as to publicity should apply under the Bill.
The amendment will ensure that wherever the regulations authorising a new issuer do not set out the designation date, they must require the Treasury to publish notice of the designation date in the relevant Gazettes. This will be in the London Gazette and Edinburgh Gazette where a bank is being authorised to issue Scottish banknotes, or the London Gazette and Belfast Gazette where the bank is being authorised to issue Northern Ireland banknotes. I beg to move.
Lord Davies of Oldham
My Lords, we are in complete agreement with the Government on this amendment.
Lord Ashton of Hyde
Lord Ashton of Hyde
“( ) section (Financial Services and Markets Act 2000 (Consequential Amendments and Repeals) Order 2001);”
“( ) Section 27 comes into force on such day as the Secretary of State may by regulations appoint.”
Welfare of Animals at the Time of Killing (England) Regulations 2015
Lord Hodgson of Astley Abbotts
That this House regrets that, since the Welfare of Animals at the Time of Killing (England) Regulations 2015 do not in all cases specify parameters for electrical water-bath stunning, poultry in England will be afforded a less rigorous level of welfare at slaughter than available in Wales and Northern Ireland (SI 2015/1782).
Relevant document: 11th Report from the Secondary Legislation Scrutiny Committee
Lord Hodgson of Astley Abbotts (Con)
My Lords, before I turn to the background to the purpose of my regret Motion, because animal welfare generally and specifically the Welfare of Animals at the Time of Killing (England) Regulations 2015, or the WATOK regulations, give rise to such strongly held views and emotions, I need to make two things clear at the outset of the debate. First, nothing—and I repeat nothing—in my regret Motion is intended to restrict or impede the operation of the slaughter of animals according to religious rites. I am not going to go so far as to say that I personally support these practices but, that having been said, I remain 100% committed to freedom of religious belief. However, secondly and conversely, where that freedom on religious grounds has not been exercised, I argue that animal slaughter should then take place to standards laid down and agreed by national and supranational bodies, such as the European Food Safety Authority and the British Veterinary Association. This is where, at least as regards the slaughter of poultry, I argue that the Government are falling sadly short.
To explain my case, it is necessary to go into what I fear are rather gruesome details. Chickens that are to be slaughtered by the water-bath method are shackled by their legs, upside-down, on a moving line. This moving line descends so that their head drops into a water bath, through which an electric current is passing. This current should be of a sufficient frequency and voltage to stun them; shortly after emerging from the bath, the lines then pass through a series of revolving blades which decapitate the birds, the first of a series of steps that finally result in the appearance on the shelves of our supermarkets, familiar to all Members of your Lordships’ House, of shrink-wrapped chickens ready for the oven.
Noble Lords will understand from that brief description the importance of the water bath being properly operated; failure to do so can result in chickens which are completely unstunned or, alternatively, chickens which will have been given a severe electric shock, in both cases remaining conscious when arriving at the decapitation process. So what are the regulations which ensure that these water baths are operated properly?
The situation as regards poultry in Wales and Northern Ireland is straightforward. For example, Schedule 3, Part 1, to the Welsh regulations says:
“Nothing in this Schedule applies to the killing of animals in accordance with religious rites which are stunned before killing, but in such cases an animal must be restrained and stunned in accordance with the EU Regulation and Schedule 1”.
Those words,
“in accordance with the EU Regulation and Schedule 1”,
are very important.
Schedule 1 says, at paragraph 28:
“No person may use a waterbath stunner to stun poultry unless—
(a) the level of the water in the waterbath has been adjusted in order to ensure that there is good contact with each bird’s head;
(b) the strength and duration of the current used is such that the poultry are immediately rendered unconscious and remain so until dead;
(c) where poultry are stunned in groups in a waterbath, a voltage sufficient to produce a current strong enough to ensure that every bird is stunned is maintained;
(d) appropriate measures are taken to ensure that the current passes efficiently, in particular that there are good electrical contacts;
(e) the waterbath stunner is adequate in size and depth for the type of poultry being stunned; and
(f) a person is available to ascertain whether the waterbath stunner has been effective in stunning the poultry and, if it has not been effective, will either stun or kill the poultry without delay”.
That is the current legal position in Wales and Norther Ireland, but the history of this issue as regards England is long, with Defra acting in an extraordinarily dilatory and indeed inexplicable way. The relevant EU regulations on the protection of animals at the time of killing were adopted in September 2009, over six years ago. It was only in September 2012, three years later, that Defra managed to get round to issuing a consultation paper. No matter that it was three years later—there were only six weeks for the consultation to take place. At that point Defra was intending to introduce the regulations in January 2013, four months later. In fact, the regulations were laid only in May 2014, 15 months later, and were due to come into force on 20 May of that year. Surprisingly, and unexpectedly, they were suddenly withdrawn on 19 May, the day before they were due to come into force, and so never came into force—and they have remained in limbo until today. That is hardly evidence of a department at the top of its game.
Baroness Parminter (LD)
My Lords, I thank the noble Lord, Lord Hodgson of Astley Abbotts, for bringing forward this Motion to Regret. Most people would agree that these regulations improve the previous slaughter provisions but would share the strong concerns the noble Lord indicated about the potential impacts on the welfare of poultry of not including the stunning parameters when using electrical water-bath stunners for religious slaughter.
The aim must as far as possible be to deliver humane stunning of poultry, subject to the constraints, some of which the noble Lord outlined, of using electrical water-bath stunners, in a manner acceptable to the relevant religious authorities reliably and consistently to provide a recoverable stun. Using electrical water-bath stunners without stun parameters risks some birds being immobilised rather than stunned and being conscious when they move to the neck-cutting stage required by halal slaughter.
As the noble Lord made quite clear, stun parameters in these circumstances have been set in Wales and Northern Ireland, following work by the European Food Safety Authority. Indeed, that raises questions about how operators who have businesses in various parts of our nation will have a comparable standard. When these proposals were hastily withdrawn, some specific wording was outlined in the Explanatory Memorandum:
“After making the 2014 WATOK Regulations, the Government decided that the potential impact on some limited aspects of religious slaughter needed further consideration and that it was preferable to revoke the 2014 WATOK Regulations in order to give full consideration to the relevant issues”.
I have read the Explanatory Memorandum and the various impact assessments that the department has provided, but at no stage does the EM or the IA spell out clearly what those issues were or what was the process of consideration by the Government. I think this House would demand that Defra operates evidence-based decision-making. I have found nowhere in the EM or the IA any indication of what specifically were the relevant issues or what was the process of their consideration that led to the removal of those regulations. What evidence are the Government using for removing these stun parameters? It is difficult to see that we can effectively stun all poultry without having set parameters.
The second issue I shall raise is the need for lessons to be learnt from the Government’s handling of this process. In its 11th report, the Secondary Legislation Scrutiny Committee highlighted the,
“inadequacies in Defra’s handling of consultation”,
and, using what I believe is rather strong language, called the process of policy formulation,
“protracted, uncertain and still unresolved”.
It chided the Government for having regulations still not in force three years later than the date set for implementation.
If the Minister is not going to agree to the recommendation made by the noble Lord, Lord Hodgson of Astley Abbotts, to re-lay the regulations including stunning parameters, will he say something about the internal review of the application of the regulations which is referred to in the Explanatory Memorandum? It makes clear that the Government intend to review this process within five years, but that it will be an internal review. I suggest that, given the concerns raised in this House and by the Secondary Legislation Scrutiny Committee, any further review of these regulations should not be internal but should be public so that there can be full scrutiny of the impact of these regulations.
Lord Trees (CB)
My Lords, I am very grateful to the noble Lord, Lord Hodgson, for introducing this Motion to Regret. This is a complex and very technical issue, but at its heart is the importance our society and our Government attach to the welfare of animals at slaughter.
First, I must acknowledge that there are a number of measures in this regulation which are improvements to the previous regulations, and I commend the Government on that. Notably, these include the requirement for abattoirs above a certain size to have a designated animal welfare officer whose job is to ensure that welfare requirements at killing are observed and effective. They also include the requirement that the personnel working in the killing process in abattoirs are appropriately trained and have certificates of competence. These are positive and welcome measures.
However, as noble Lords have said, there are other features of the regulations pertaining to poultry that do not prioritise animal welfare. Of specific concern is the failure to specify particular parameters for the electrical stunning of poultry in water baths. Previous rules did not specify the electrical current and frequency to be used, and it has been recognised that under certain conditions—low current, for example—animals may not be properly rendered unconscious before the neck-cut to sever the blood vessels kills them.
As a result of a thorough review of these issues by an expert panel convened by the European Food Safety Authority, the EU formulated regulations to include recommended levels of current and frequency in order to achieve the unconsciousness of animals more reliably. Why have these specific conditions not been included in the adopted regulations? The Government’s own Explanatory Memorandum suggested that the original regulations for England that contained specific conditions for stunning were withdrawn in 2014 due to concerns over,
“the potential impact on some limited aspects of religious slaughter”.
The noble Baroness has asked this question already—I promise that we did not confer—but I shall ask it anyway: what is the “potential impact”? The original recommendations include a range of conditions referring to current and frequency that research has shown reliably induce unconsciousness but do not kill the anima1. This latter is crucial to enable the stunning to be done in compliance with the requirements of halal slaughter, which requires stunning, if it is used, to be reversible—that is, recoverable—so that the animals are technically alive, though insentient, at the point at which their throat is cut.
I welcome the fact that the majority of animals subject to halal slaughter are stunned before killing. The WATOK regulations as originally drafted would enable effective but reversible stunning, which is acceptable for halal so far as I can see, so I am perplexed as to why the current WATOK regulations for England exclude these greater safeguards to ensure that poultry are effectively electrically stunned. Moreover, the lack of defined electrical parameters applies to all poultry in England. This could mean that millions of birds stunned for the non-religious market may not be as effectively stunned as possible, based on current evidence. As the noble Lord, Lord Hodgson, has pointed out, this is in contrast to the EU’s recommended requirements for all stunning, religious and otherwise; and, with respect to religious slaughter, is in contrast to the regulations adopted by Northern Ireland and Wales and de facto in Scotland. This is a gross anomaly within the UK and is difficult to understand. I would welcome an explanation from the Minister for this omission.
I stress at this point that the adopted regulations still allow religious communities the option not to stun. That is an option with which I personally do not agree, but it respects religious freedoms. As an aside, I find it of considerable concern that the number of sheep and goats killed without stunning in the UK has risen from an estimated 1.5 million in 2011 to an estimated 2 million-plus in 2013, based on the FSA’s survey of abattoirs in those two years. That is a regrettable trend that I argue is in the wrong direction for animal welfare.
In conclusion, I support the noble Lord, Lord Hodgson, in regretting the WATOK regulations relating to the electrical stunning of poultry. I contend that they are anomalous and regressive and do not enhance our national reputation for upholding animal welfare.
Baroness Byford (Con)
My Lords, I thank my noble friend for bringing forward this short debate. It is entirely right that we should be having it, and I am very pleased to be able to add one or two questions to the Minister. Before I start, I should tell noble Lords that I am a former poultry farmer so I have been at the sharp end of the rearing, the breeding—and at the end, obviously, the killing of poultry. The one thing that we tried to do throughout our lifetime still applies to good farmers today: they are very keen that welfare is of extreme importance, whether at birth, through life or in death. I declare that I am an associate member of the BVA. I thank it for its briefing, which I think several noble Lords have referred to.
Over the years I have also taken part in the many animal health and welfare Bills. I know that if the noble Countess, Lady Mar, was well enough, she would be taking part in this debate tonight, because she is another person who takes great interest in trying to improve the lot of animal welfare.
Lord De Mauley (Con)
My Lords, this country has always prided itself on being at the forefront of the preservation of animal welfare, especially at the point of slaughter. That was why the Welfare of Animals (Slaughter or Killing) Regulations 1995—the regulations which preceded WATOK—contained, in addition to rules to implement the then EU directive, national rules, including for religious slaughter, which gave greater protection for animals than was contained in the directive. Therefore my first question for my noble friend is: can he confirm that those national rules will all remain in place under WATOK?
I understand that the FSA’s most recent animal welfare survey, in 2013, showed that less than 21% of all poultry during the survey period was killed by a religious method and approximately 18% of birds were stunned prior to slaughter, so, to put this in context, less than 3% of the total poultry production in Great Britain is—or at least at that stage was—not stunned. I would prefer to see all animals stunned before they are slaughtered. Equally, like my noble friends, I respect the rights of the Jewish and Muslim communities to eat meat prepared in accordance with their religious beliefs. It is, I think, helpful that WATOK introduces welfare enforcement notices, which allow the official vet to slow down or stop a procedure or operation, or to require the business operator to take specified steps to remedy a breach of the welfare regulations.
In a nutshell, this debate is about the balancing act between animal welfare and religious freedom. So, returning to the concern of my noble friend Lord Hodgson, I ask my noble friend the Minister for his assurance that, despite WATOK not applying the stunning parameters in annexe 1 of the EU regulation to halal slaughter, welfare standards are not being weakened or compromised.
Lord Grantchester (Lab)
My Lords, the House last debated the regulations on welfare in animal slaughter in a QSD raised by the noble Lord, Lord Trees, in January 2014, and I am grateful for his contribution again tonight. The noble Lord, Lord De Mauley, was a Minister at the Dispatch Box at that time, and his comments are welcome, as are his questions. The noble Lord, Lord Hodgson, raised his concerns at that time and I am grateful to him for bringing them back to us for examination. I declare my interest as a dairy farmer but I do not have any poultry.
As we have heard tonight, matters since that QSD have not continued smoothly. Later in 2014, the Government brought in regulations but revoked them before they came into force, citing that the potential impact of some limited aspects of religious slaughter needed further consideration. At that time, your Lordships’ Secondary Legislation Scrutiny Committee considered that the inadequacies of Defra’s handling of the consultation appeared to have reduced the quality of policy-making and to have contributed to a process that was protracted, uncertain and still unresolved more than 18 months after the key consultation took place.
A further 18 months have now gone by. The Secondary Legislation Scrutiny Committee remained concerned. In its 11th report in 2015 it said:
“The delay that has occurred since revocation of the 2014 WATOK Regulations may have allowed a better articulation of policy in the light of those views, but we remain concerned that the Department’s uncertain handling of the relevant secondary legislation will have caused confusion to those interested parties who have awaited decisions on implementation of the EU Regulation”.
Since 2014, there does not appear to have been any further consultation, yet Wales and Northern Ireland have already implemented a crucial variation that has been highlighted by the noble Lord, Lord Hodgson. This omission has consequences for the welfare of chickens in that in England’s regulations no stunning parameters are prescribed that would help to ensure an effective stun during water-bath stunning. Other noble Lords have drawn attention to this.
I should also like clarification on why this has been designated by the Minister as a negative SI. I understand that, under the Legislative and Regulatory Reform Act 2006, in making a decision that designates an SI as a negative instrument the Minister must satisfy a list of tests. Taking into consideration the negative procedure in relation to parliamentary scrutiny and the wide range of opinions on these regulations, can the Minister explain his ministerial thinking in making the decision to designate this as a negative SI?
The noble Baronesses, Lady Parminter and Lady Byford, asked the Minister to explain the issues behind the considerations that brought about the withdrawal of regulations last year and why the review came to the conclusion that it did, differing from the regulations in the devolved Administrations.
The use of electrical water bath stunners raises concerns that this in itself has a detrimental impact on bird welfare. The shackling and inversion of live birds is both stressful and painful. In addition, it is not currently possible to ensure that all birds receive an effective stun in this procedure. This leads to the situation where operators cannot distinguish between an unconscious bird and an immobilised bird, and so cannot assess stun efficacy. As the noble Lord, Lord Hodgson, has described, the omission of parameters for electrical water-bath stunning can lead to an ineffective stunning of birds with resultant suffering.
It would appear that the Minister’s SI needs to address two crucial aspects. First, stunning parameters must be set at a level that are known to achieve a consistent effective stun. Secondly, these stunning parameters must be specific to and acceptable for use by the relevant religious authorities, ensuring that the parameters will reliably and consistently provide a recoverable stun.
Labour appreciates that organisations including the British Veterinary Association, the National Secular Society and the British Humanist Association have all expressed concern about the animal welfare implications of religious slaughter. These views have been contested by Jewish and Islamic groups.
Under EU law, there is no requirement to label meat as “stunned” or “non-stunned”. The EU Commission is currently considering the practicalities of enforcing such regulations. That announcement is awaited. Labour believes that labelling should not be faith-specific so that the issue remains one of animal welfare and is not in any way religiously orientated. Consumer interests are best served through transparency in food production and processing. Consumers have the right to know exactly where their food comes from, how it has been raised, and how it has been slaughtered and processed. Labelling is important, as production supply according to religious procedures is in excess of that demand and the resulting excess becomes part of the national food chain.
The Explanatory Memorandum does not highlight any differences between the regulations that apply in England and those that have been introduced in Scotland, Wales and Northern Ireland. The RSPCA has provided an excellent briefing note that highlights the omission of one paragraph on the general prohibition. The noble Lord, Lord Hodgson, quoted this and underlined the differences resulting from this in the effects that pertain in the devolved Administrations.
It is important that the Government get these regulations right to be consistent with EU legislation and to balance welfare and the demands of the religious authorities.
Lord Gardiner of Kimble (Con)
My Lords, I entirely understand the concern of my noble friend Lord Hodgson of Astley Abbotts for animal welfare. Animal welfare at slaughter is an issue that is important to the British public, and the Government are committed to improving standards of animal welfare.
As my noble friend has pointed out, there are differences in the animal welfare at slaughter regulations in England as compared to those in Wales and Northern Ireland, reflecting the fact that animal welfare is a devolved issue. Notably, there is a difference in approach to religious slaughter, but this is the only substantive difference between the domestic legislation in England and that in Wales and Northern Ireland.
I hope that my reply tonight will help assure your Lordships that the recent regulations that the Government have introduced improve animal welfare at the time of killing. I am most grateful to the noble Baroness, Lady Parminter, and the noble Lord, Lord Trees; although I understand that they are not entirely happy with the situation, they did acknowledge that the Government are seeking to improve animal welfare all the time. I would like to assure my noble friend Lord De Mauley—given his previous position, this is terribly important—that there is absolutely no wish or intention in anything that is being done to weaken anything that we have in place.
The public rightly expect the Government to ensure that appropriate measures are in place to protect the welfare of animals when they are killed. Indeed, there is a long history to our current national requirements on slaughter, including religious slaughter.
Lord Hodgson of Astley Abbotts
My Lords, I begin by thanking all noble Lords who have spoken in the debate. I thank the noble Baroness, Lady Parminter, for her forensic examination of the difference between the regulations, the noble Lord, Lord Trees, as a distinguished veterinarian who is some way further up the learning curve than I am, my noble friend Lady Byford for her practical experience, my noble friend Lord De Mauley, who is a poacher turned gamekeeper or perhaps a gamekeeper turned poacher—I am not sure which way round it is—and the noble Lord, Lord Grantchester, who I appreciate made some interesting comments, to one of which I should like to return in a moment.
As I expected, my noble friend on the Front Bench has given a full, courteous and comprehensive reply, and I would not want him to think that I underestimate the advantages that have come about in animal welfare as a result of some of these regulations. His lengthy remarks on this technical subject deserve a careful read in Hansard, but I have to say to him that I think there was a drawing on a mixture of the religious and non-religious—this way and that way—which I did not find entirely clear. However, I owe him a careful read. We did not get to the bottom of the issue about why there is this critical omission and change in the text of the English regulations compared to those in Wales and Northern Ireland.
The Times of 4 November states:
“If this was a clerical omission it would be merely regrettable, but it appears to be worse than that. When the new rules on stunning chickens were placed on hold last year the hesitation was explained by Defra on the ground that they might limit religious freedom. Concern was also voiced”—
as my noble friend said this evening—
“that if a minimum shock strength was imposed that was deemed too high, some halal slaughterers might stop shocking altogether. The first argument prioritised unscientific belief over animal welfare. The second allowed a minority of slaughterers to reset the legal parameters for their whole industry. Religious slaughtermen have a right to derogate from EU law (and thus most national regulations) governing non-religious slaughterhouses. This is as much latitude as any religion can reasonably demand”.
I am irrevocably or inevitably drawn to the conclusion that these regulations, as regards the position of poultry, are a fudge. Defra knows that they are a fudge and I suspect that my noble friend knows they are a fudge. This is not a happy evening for animal welfare as regards poultry. More importantly, as the noble Lord, Lord Grantchester, pointed out, it is not a happy evening for candour in public policy. Whatever our religious beliefs, the Government owe the country to be open and honest about matters such as these. Otherwise, suspicion, misconstruction and mistrust flourish, which was the point made by the noble Lord, Lord Grantchester, about the need to have transparency in the way in which decisions are reached in these matters.
I end by repeating that, in the light of all that has been said this evening, I hope my noble friend will go away and talk to his officials about further consideration of putting in the particular words in the regulations, which would answer the questions that we have all raised this evening. But it is late and, in the mean time, I beg leave to withdraw the Motion.
Motion withdrawn.