House of Commons
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Oral Answers to Questions
(7 years, 1 month ago)
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Seema Kennedy (South Ribble) (Con)
The Parliamentary Under-Secretary of State for Pensions (Richard Harrington)
The Government are committed to providing free and impartial guidance through Pension Wise to help people make informed and confident decisions about how they use their defined contribution pension savings in retirement.
Seema Kennedy
I am grateful for that answer. Will my hon. Friend reassure me that the Government are taking steps to protect people from being scammed out of their savings as well as ensuring that people have access to information to help them to decide how to draw down their pension savings?
Richard Harrington
My hon. Friend is absolutely right to ask that question. The Government take the threat posed by scams very seriously indeed. We run campaigns to highlight the risk posed by scams to savers, and we have established a cross-government taskforce to gather and share intelligence, and to co-ordinate enforcement action. We have also consulted on further measures to tackle scammers, including a proposal to ban cold calling in relation to pensions. Our next step will be announced very soon.
Chris Leslie (Nottingham East) (Lab/Co-op)
Well, that is the point I was going to ask the Minister about. Will he tell us when he will crack down on cold calling? These people are trying to scam others out of their hard-earned life savings, taking advantage of the notion that there are these freedoms, but potentially putting pensioners at great risk. When will the legislation be brought forward?
Richard Harrington
As is to be expected, the hon. Gentleman asks a pertinent question; very soon, is the answer.
Mr Philip Hollobone (Kettering) (Con)
Preying on elderly people in order to take advantage of their pension pots by giving them bad advice is a despicable crime. Is the Minister satisfied that the number of prosecutions of those who do this frankly evil activity is nearly enough?
Richard Harrington
I would like to be able say that it is enough, but I do not think it is. The steps we intend to take should make prosecutions for scam cold calling much easier. If I am asked the question again in the future, I hope to be able to answer in the affirmative.
Ian Blackford (Ross, Skye and Lochaber) (SNP)
On the issue of accurate and clear information, the Cridland report, published last week, stated:
“An increase of the State Pension age every ten years—and by only one year per decade—represents an appropriate pace of change”.
Does the Minister agree with that statement? If so, will he revisit the issue of the WASPI women, who face an increase in the state pensionable age of more than five years this decade?
Richard Harrington
I know that the hon. Gentleman has read the Cridland report in detail, and I thank him for doing so. It will suffice to say that the Government’s response will be published at the end of May and will be comprehensive. As far as the WASPI women are concerned, he knows—I have said this many times at this Dispatch Box and elsewhere—that the Government have made the concession that they are going to make in terms of transitional arrangements from the Pensions Act 1995. I have no further news. That is it.
Mr Alan Mak (Havant) (Con)
Reducing fees and charges levied by pension companies is important to helping customers to get the most from their investments. Will the Minister update the House on what progress has been made in that area?
Richard Harrington
My hon. Friend and I have discussed the matter, and I am pleased that he has highlighted it. There has been consultation on the subject, and the Government will make an announcement ourselves and through the regulator very soon.
Alex Cunningham (Stockton North) (Lab)
The Government missed an opportunity this year to tackle a wide range of issues in the pensions industry, but they chose to ignore most of them, instead bringing forward the narrow Pension Schemes Bill. The Secretary of State then failed to further his own agenda by instructing his Ministers to resist any attempt to introduce transparency, member engagement and greater clarity on costs. Why does he choose to protect the industry instead of savers? What will the Government do to correct this failure and help us all to build trust in our pensions industry?
Richard Harrington
I thank the shadow Minister for voting for the Bill on Second Reading, and for his generally constructive approach to it. As the hon. Gentleman well knows, the transparency agenda is part of a much broader agenda, and the Government will make a proposal very soon.
Martin Vickers (Cleethorpes) (Con)
I am currently dealing with two constituency cases in which old people have been robbed of their life savings. In both cases, they have been disappointed with the police response. Will the Minister’s cross-departmental work include contact with the Home Office and individual police forces to ensure that more work is done to address this?
Richard Harrington
I can confirm that the police and anti-fraud authorities are involved in this cross-governmental body.
Justin Madders (Ellesmere Port and Neston) (Lab)
The Secretary of State for Work and Pensions (Damian Green)
This Government support those who aspire to be their own boss. Self-employment grew by 148,000—3.2%—in the last year to reach a record level of 4.8 million. Self-employment has contributed 30% of the rise in employment since 2010 to the current record levels.
Justin Madders
It seems that not a week goes by without another story emerging of the outrageous treatment of the self-employed. This is exploitation. The Deane review of self-employment reported back to the Government over a year ago, and one recommendation it made was that there should be equal treatment for the self-employed, but all we have is yet another review from the Government. When will they actually take some action?
Damian Green
As the hon. Gentleman knows, the Government have commissioned Matthew Taylor to review the rights and protections available to self-employed workers. He asked what we have already done. The self-employed now have access to the new state pension, worth an extra £1,800 a year in retirement. We have doubled the amount of free childcare, which is particularly useful for the self-employed and worth up to £5,000 per child per year. We have also increased the personal allowance, worth £1,000, to the typical basic rate taxpayer.
Mr Peter Bone (Wellingborough) (Con)
The Secretary of State is right: we have definitely helped the self-employed. However, it was put to me at my listening campaign this weekend by self-employed people that they actually want the Government out of their business. They do not want to pay higher taxes, and they do not want more benefits; they just want to get on with their business. Is that something the Secretary of State could support?
Damian Green
I do, and the Government, of course, support that more widely. We are looking all the time at regulations that might hinder the growth of entrepreneurship and self-employment. The actions taken by my Department—for instance, the new enterprise allowance—actively encourage people into self-employment. Some 96,000 new businesses have been set up as a result of the NEA.
Debbie Abrahams (Oldham East and Saddleworth) (Lab)
The Government’s proposed increase to national insurance contributions for self-employed workers in this month’s Budget showed a scandalous detachment from the reality of the majority of self-employed workers’ lives, a failure to understand the boom in self-employment and a lack of the will to address the issues self-employed workers face, including the fact that one in three is concerned about becoming sick or being injured during their work. What discussions did the Secretary of State have with the Chancellor on this before the Budget, and is he concerned about the reliability of the minimum income floor calculation, given the Office for Budget Responsibility’s comment?
Damian Green
I am confident in the minimum income floor calculation. As the hon. Lady would expect, we have discussions all the time with the Treasury on a wide range of matters. My right hon. Friend the Chancellor said in his letter subsequent to the Budget:
“It is very important…that we are compliant not just with the letter, but also the spirit, of the commitments that were made.”
That is why he decided not to proceed with the class 4 NIC measures set out in the Budget. Also—this is important—all the spending measures set out in the Budget, including on social care, technical education and new schools, will be delivered in full.
Mr David Nuttall (Bury North) (Con)
My right hon. Friend is right to note that 96,000 new businesses have been started by jobseekers, but many jobseekers still do not know what help is provided under the universal credit system and the new enterprise allowance. Will he say what his Department is doing to increase awareness of these measures?
Damian Green
My hon. Friend makes a good point. Obviously, universal credit is still a relatively new benefit, and many of the self-employed may not be fully aware of the many benefits that arise from it for them specifically. Under UC, self-employed claimants will, for the first time, be offered help to increase their earnings. We will be testing the offer of work coach support to self-employed tax credit claimants. Also, there is an assured level of earnings, but new self-employed claimants will be exempt from this for up to 12 months following their application, which people thinking of setting up their own business will find extremely helpful.
Lilian Greenwood (Nottingham South) (Lab)
Mr Stephen Hepburn (Jarrow) (Lab)
The Minister for Disabled People, Health and Work (Penny Mordaunt)
The Department robustly monitors provider performance and independently audits assessments. Assessment reports deemed unacceptable are returned for rework. A range of measures, including contractual remedies, are used to address performance falling below those standards.
Lilian Greenwood
A constituent contacted me after she submitted a claim for personal independence payment and then had to wait 12 weeks for the home assessment appointment she needed. Capita finally telephoned, giving less than 48 hours’ notice of the visit, only to cancel 10 minutes before the appointed time. After three and a half months, she is still no nearer receiving the support she needs. I know from my discussions with the Meadows Advice Group that she is just one of dozens of disabled people being let down by the Minister’s Department. When will the Minister address this catalogue of failure?
Penny Mordaunt
If the hon. Lady would let me have sight of that case, I will look into it in particular, because it is unacceptable and falls below the performance and the courtesy, quite frankly, that we would want from our providers. People’s personal experience is very important in getting this process right. I am pleased to be able to say that from April we will commence the user rep panels, with about 300 people initially, across the UK, to whom we will give real-time experience of PIP and ESA—employment and support allowance.
Mr Hepburn
We have all had cases like that, but could it not only be an arrogant Tory Government who ignore legal decisions that override expert medical opinion in order to deprive people with mental health issues of the right to benefits? What level of cuts has the Minister promised the Chancellor in order to get this policy through?
Penny Mordaunt
I am afraid that the hon. Gentleman is being very irresponsible in saying that. He knows that there is no change to policy, to budget or to award amounts. I remind him that people with mental health conditions are receiving higher levels of benefit than they did under DLA. This benefit is not about people’s conditions; it is about the impact that those conditions have on the individual’s ability to thrive and live their life as they would wish. It is quite wrong and irresponsible to suggest anything otherwise.
Justin Tomlinson (North Swindon) (Con)
The vast majority of successful appeals are due to late additional submitted evidence. Therefore, to avoid unnecessary appeals, what steps is the Minister taking to automatically access medical reports with the consent of the claimant?
Penny Mordaunt
This is one of the key reasons why not only is 3% of the PIP caseload being overturned at appeal, but we are not getting the right decision at mandatory reconsideration stage. We have been doing a number of trials to improve that, including telephoning claimants to ensure that all the healthcare information that is required for a good assessment and a good decision is in place. There are other measures as well. I hope that this will improve the situation.
Caroline Ansell (Eastbourne) (Con)
Any delay in making the PIP award is stressful for the person in need of that support and creates inefficiencies in a very pressed system. A number of cases successful at first tier tribunal are challenged by the Department and then ultimately upheld. Can the Minister assure me that this number is monitored, statistically insignificant, and, in light of improvements in assessment, falling?
Penny Mordaunt
I can give my hon. Friend those assurances. In addition to the measure that I have mentioned, there are a number of other trials going on and a number of changes that our providers are making—for example, sitting down with someone and talking about the effects of their condition on their ability to live their lives prior to a medical history being gathered.
Ronnie Cowan (Inverclyde) (SNP)
One thousand and ninety-nine people currently use the Motability scheme in Inverclyde. It can be over eight weeks before a successful appeal, and during that time claimants are without their car. What is being done to address this specific issue?
Penny Mordaunt
As I have reported to this House before, we have been working ever closer with Motability— a great scheme in its 40th year. We are looking at a number of issues, such as appeals; people who may wish to leave the country, whether for study, work experience, or any other reason; and potentially extending the scheme to other groups. We will report on that review as soon as we can.
Andrew Bridgen (North West Leicestershire) (Con)
Can the Minister confirm that far from cutting support for disabled people, disability spending will increase every year to 2020 relative both to 2010 and today?
Penny Mordaunt
My hon. Friend is absolutely right that spend will increase, but it is also vital that this Government look at other issues, as we are doing—for example, on the consumer agenda. It is no good our spending money and getting the employment support right if buildings are not accessible and people cannot make use of these opportunities.
Ms Marie Rimmer (St Helens South and Whiston) (Lab)
Last Thursday, at business questions, the Leader of the House stated that there would be a debate on the Government’s emergency PIP regulations, which will affect the eligibility for PIP of more than 160,000 people, mainly those with mental health conditions. However, he failed to give a date, and the praying against period comes to an end on 3 April. If there is no debate and vote before the House rises for Easter, even if the House votes against the regulations next month they will not automatically be revoked. That represents a huge democratic deficit. Will the Minister now commit to scheduling a debate and vote this week?
Penny Mordaunt
The hon. Lady will know that that is not within my gift; it is for the usual channels. It is not correct to say that the regulations will affect 160,000 people. [Interruption.] No, there is no policy change. There is no change to the budget, and there is no change to the guidance that we have issued to our assessment providers. It is quite wrong to raise fear by saying to people that they will be affected. No awards will be affected, and we are operating exactly the same policy and guidance in our assessment practices as we have done before.
Dr Philippa Whitford (Central Ayrshire) (SNP)
Mr David Hanson (Delyn) (Lab)
Paul Blomfield (Sheffield Central) (Lab)
The Minister for Disabled People, Health and Work (Penny Mordaunt)
Recent changes to the PIP regulations clarify the original criteria used to decide how much benefit a person receives. This is not a policy change or a budget change, and it will not result in any claimants, regardless of their health conditions, seeing a reduction in the amount of PIP they have been awarded.
Dr Philippa Whitford
Former Sergeant William Bradley, who is one of my constituents, developed severe PTSD and depression while serving in the Gulf war, and he was medically discharged from the Army in 2003. He had been on the enhanced PIP rate since 2014, but it was cut to the lower rate last year. Following an appeal, it has now been removed completely. The reply from the PIP hotline was that someone with mental health issues can work, and that this is really a benefit for people with severe physical disabilities. Will the Minister meet me to discuss this awful case, or, if PIP is not the right benefit for those with mental illness, can she explain what is?
Penny Mordaunt
What the hon. Lady tells me has happened is truly shocking. I would be incredibly surprised if somebody who was manning that hotline said those things to the hon. Lady. I am not saying that I doubt her story, but I would like to see that and I would like to know, if possible, the exact time that that conversation took place, because that is quite wrong. I would be happy to meet the hon. Lady.
The statistics show that if someone has a mental health condition—if they have PTSD, dementia, a psychological disorder or another mental health condition —they are better served under this benefit. It is important that people know that.
Penny Mordaunt
The Committee is within its rights to look at the decision. It did so, and it concluded that it would not formally review that decision. We have used the urgency procedure, as it was within our rights to do, to establish certainty. We do not want there to be a long period of uncertainty around this, and we do not want to be in the position of having to take money off people. What we have done is to restore that certainty. Everyone knows where they are, and people know that there is no change and their awards will not be changing.
Paul Blomfield
It was a constituent of mine whose case led to the recent tribunal ruling that clarified the eligibility criteria for PIP, and to the Government’s subsequent amendments to the regulations. She lives with multiple health problems and was supported by Sheffield Citizens Advice, which is due to publish a report later this week on the wider impact of the shift from DLA to PIP and the particular effect that it is having on the over-65s. Will the Minister agree to meet me and Citizens Advice to discuss its recommendations?
Penny Mordaunt
I would be very happy to meet the hon. Gentleman to do so. PIP is a better benefit than DLA—it better serves a wider range of people with a wider range of conditions better—but we can always make improvements to the system, and I would be very happy to meet him.
Kevin Foster (Torbay) (Con)
In relation to PIP, will the Minister assure me that the DWP is engaging with those with experience of mental health conditions to ensure that our programmes and our frontline staff have a proper understanding of how a mental health condition can have an impact on someone’s life?
Penny Mordaunt
I can give my hon. Friend such an assurance. In addition to the user rep panels that we are introducing in April, we have been conducting a trial since mid-March—it will take about six weeks—looking at audio recording, which should involve about 400 claimants. That is a tool not just to guarantee quality, but to provide reassurance to the claimant.
Mr David Burrowes (Enfield, Southgate) (Con)
Some of those who are eligible for PIP may well lose entitlement to the work-related activity group element come 1 April. Will the Minister reassure me that whether through the flexible support fund, the hardship fund or indeed third-party deals, there will be full mitigation for the losses they incur from 1 April?
Penny Mordaunt
I can give my hon. Friend such an assurance. People are open to apply to the financial channels he mentions if they need further support. We have been doing some work in the Department on social tariffs and budgeting, which will be rolled out across our Jobcentre Plus network, and all the elements of the support offer for that group are already in place.
Mr Alistair Carmichael (Orkney and Shetland) (LD)
Last week I had to deal with a constituent whose benefits had been stopped because she missed an appointment to be assessed for PIP. She missed that appointment because she was an in-patient in hospital in Aberdeen. Even after evidence of that had been exhibited to the Minister’s Department, it twice refused to reinstate her benefits because it said that it had done nothing procedurally wrong. Is the Minister content that that is how the system is supposed to work?
Penny Mordaunt
The right hon. Gentleman will know that that is not how the system is supposed to work. If there is a reasonable reason why someone has not attended an appointment, missing it should not count against them. I am quite happy to look at the case that he cites, but that should not be happening.
James Berry (Kingston and Surbiton) (Con)
The Minister for Employment (Damian Hinds)
The number of 16 to 24-year-olds in work is 3.94 million, which is up 28,000 on the quarter and 225,000 on 2010.
James Berry
At the last count, there were 145 jobseeker’s allowance claimants aged 18 to 24 in Kingston, yet when I go to businesses such as New England Seafood, Genuine Solutions and Meeting Point, they tell me that they have vacancies, particularly for young people. What can my hon. Friend do to ensure that young people are matched up with the many opportunities that businesses in my constituency and others have for them?
Damian Hinds
The number of young people in my hon. Friend’s constituency claiming out-of-work benefits has fallen by more than half in the past four years, and he is right to highlight the large number of vacancies—over three quarters of a million nationwide. Alongside promoting work experience and apprenticeships, the Government will soon be rolling out the youth obligation, providing additional intensive support for young people from day one.
Jenny Chapman (Darlington) (Lab)
The Minister can highlight what he likes, but long-term youth unemployment in Darlington and the Tees valley is completely stagnant: the situation has not improved at all. What is he going to do to make sure that in six months’ time the picture has improved?
Damian Hinds
Long-term youth unemployment is down 111,000 overall since 2010, and it is down 30,000 on the year. We put particular resource into and focus on the individual areas around the country that need additional support. I encourage more firms to come forward and join the work experience programme, because we know that the experience of actual work is one of the most fundamental things to help young people to move into a regular job.
Mrs Cheryl Gillan (Chesham and Amersham) (Con)
Young autistic people have a great contribution to make to our economy and society, yet a recent survey by the National Autistic Society reckons that only 16% are in full-time work, and that trend has not changed during the past 10 years. In World Autism Awareness Week, will the Minister tell us how the Government could help? Not only are our employers missing out on the skills and potential of this group of people, but we are wasting an awful lot of talent. How can the Minister help to highlight their plight?
Damian Hinds
May I first acknowledge and recognise my right hon. Friend’s particular expertise in this area? I met the National Autistic Society at the party conference, as a number of colleagues did, and some of the statistics she mentions are indeed very striking. The Minister for Disabled People, Health and Work is bringing forward, through the Green Paper process, a particular focus on the talents, abilities and potential of people with autism, which will be key.
Greg Mulholland (Leeds North West) (LD)
Research just published shows that the forthcoming apprenticeship levy will make the north-south divide worse, because investment will be focused on the south-east, not where it is needed in the north. What will the Minister do to address that?
Damian Hinds
This is a generational shift in investment in the skills base. The levy is an important part of ensuring that all firms of a particular size are incentivised to take part, and the new Institute for Apprenticeships will guarantee the quality of apprenticeships. I think that that will benefit the entire country.
Helen Whately (Faversham and Mid Kent) (Con)
The Secretary of State for Work and Pensions (Damian Green)
We are making progress on the independent mental health and employers review, which is led by Lord Stevenson and Paul Farmer. We are also taking forward an internal review of discrimination law in relation to mental health and work. We continue to look at how we can improve employment support for people with mental health conditions, and this approach is reflected in the work and health Green Paper.
Helen Whately
I recently trained as a mental health first-aider. Such training helps people to support others with mental health problems, as well as to look after their own mental health. Will my right hon. Friend encourage more employers to take part in initiatives such as mental health first aid to create a culture in which everyone feels able to seek mental health support in the workplace?
Damian Green
I congratulate my hon. Friend on taking that training, which is very important. She is right that more employers should act. We are now providing a range of support to help employers to recruit and retain people with mental health conditions, including the Disability Confident campaign and the mental health support service in the Access to Work scheme, which many firms and those who suffer from mental health conditions find useful.
Helen Goodman (Bishop Auckland) (Lab)
The Secretary of State should beware of being so enthusiastic that he ignores the real needs of people who cannot go to work. I had an email this morning from one of my constituents saying that her husband had taken his life on Friday. He first came to us in 2016 when his award of employment and support allowance was under review. Despite his doctor’s protest, he was made to have a face-to-face assessment. We sought an extension of the six-month award; that was refused. At that point, he was so stressed that he attempted suicide. The PIP award was reviewed again in January. Will the Secretary of State please ensure that when doctors say that people with mental health conditions should not have face-to-face assessments, they do not have face-to-face assessments?
Damian Green
The case that the hon. Lady raises is clearly dreadful. I am sure that the whole House will want to send condolences to the family and friends of her constituent, particularly his widow. We are, of course, not just investing more in mental health than ever before—£11 billion this year—but succeeding specifically in improving clinical assessments. More clinical expertise is now available to the assessors who look at individual cases. As she will know, we have now ended reassessment for those who have conditions that can only stay the same or get worse. We are taking steps to try to minimise those effects.
John Howell (Henley) (Con)
Damian Green
My hon. Friend is right. We are taking action through Access to Work and Disability Confident, which I mentioned in response to my hon. Friend the Member for Faversham and Mid Kent (Helen Whately), but this needs to be part of a much wider programme of education specifically for employers. We have set up a Disability Confident business leaders group because I suspect that employers will listen more to other business people than they necessarily will to politicians.
Dame Rosie Winterton (Doncaster Central) (Lab)
Is not the main issue to make sure that people have good access to occupational health services—particularly so that preventive action can be taken if an individual feels that they are suffering from a mental health problem—meaning that they can get to an occupational health service quickly and easily to get proper advice?
Damian Green
I completely agree with the right hon. Lady. She will have seen that the work and health Green Paper lays great stress on occupational health services. We have more than doubled the number of employment advisers in talking therapies to make sure that we can help people with the necessary support that will enable them to stay in work. We will need to do more of this important job in the future.
Lucy Powell (Manchester Central) (Lab/Co-op)
The Minister for Employment (Damian Hinds)
The roll-out of universal credit continues to roll out to plan—[Laughter.] About a million claims have now been taken, and the full universal credit service for all claimant types is available in 53 jobcentres.
Lucy Powell
I shall not mention hon. Members’ ridicule of the Minister’s answer, but I want to raise another point about universal credit: the interaction between passported benefits and universal credit, and the progress on this that the Government are making. My constituents tell me that as they get into work and move through universal credit, they lose free school meals, bus passes for their children and entitlement to a free uniform, so they are much worse off in work than they would be if they were not in work.
Damian Hinds
We continue to work closely with partners and stakeholders to ensure that this service is a success. There are some questions about passported benefits and we continue to work through them.
Sir Julian Brazier (Canterbury) (Con)
I thank my right hon. Friend the Secretary of State for coming down to see the successful roll-out of universal credit in Canterbury, where nearly a third of the unemployed now enjoy universal credit. That has not only pushed down the level of unemployment, but resulted in remarkably few cases coming to my surgeries.
Damian Hinds
Universal credit is a transformational benefit. It converts six benefits into one, which means working with one organisation and not three. It supports people into work and makes sure not only that work pays, but that it is visible to the individual that work pays. It is indeed transformational in our system.
Dr Eilidh Whiteford (Banff and Buchan) (SNP)
In just a few days’ time, austerity cuts to universal credit come into effect that will further cut the incomes of millions of working families, including families with disabled children, who could lose about £1,600 a year, while single parents in full-time, low-paid work could lose almost £200 a month. Was the intention of universal credit to drive up poverty among disadvantaged children? If not, why will Ministers not accept that the system is failing those whom it was designed to help?
Damian Hinds
No such cuts are about to happen in universal credit. The taper change from 65% to 63% will eventually benefit 3 million households.
Dr Whiteford
Mounting evidence from the full service roll-out areas exposes the fact that the universal credit system is beset with failure. It is simply not working. Rent arrears are soaring, claimants are waiting up to three months to have their claims processed and some people have even lost their homes. The Government need to get their head out of the sand, so will Ministers call a halt to the full service roll-out while they conduct an immediate review?
Damian Hinds
We will not call a halt to the roll-out, because it would be unfair and wrong to deprive people in Scotland or elsewhere of the advantages that the universal credit system brings. We continue to work on improving processes and accelerating delivery, including with respect to housing, and a number of improvements have already been made, with more in train.
Margaret Greenwood (Wirral West) (Lab)
Last week’s report by the Equality Trust illustrates just how extreme inequality is in the UK, with the average pay of chief executive officers of FTSE 100 companies standing at £5 million a year. From this April, families on low incomes who are claiming tax credits or universal credit will not receive support for the third and subsequent children in a family, except when the child is disabled. In that instance, however, the money will be withdrawn from one of the other children. Will the Government address this injustice and scrap the two-child limit?
Damian Hinds
The purpose of the limit on support through universal credit or tax credits to the first two children, in the case of new claims and new births, is to reduce our welfare spending and to target it in a particular way—[Interruption.] In some 85% of families that include children, there are one or two children. When it came to determining where necessary reductions must be made, this was the correct way of doing that.
The hon. Lady talks about rising inequality. I simply mention to her that inequality is down, and that household incomes are at a record level.
Mr Clive Betts (Sheffield South East) (Lab)
The Minister for Employment (Damian Hinds)
The Department has sought to maintain the services that it offers claimants while minimising the impact on claimants as far as possible. These proposals may mean slightly longer and slightly shorter journeys for some individual claimants, and that has been taken into account in the setting of the criteria.
Mr Betts
I congratulate my hon. Friend the Member for Sheffield, Heeley (Louise Haigh) on the campaign that she has run with the Public and Commercial Services Union and local residents to keep open the Eastern Avenue jobcentre, which serves both our constituencies. Will the Minister confirm that the only reason for closing Eastern Avenue is to save money, and that if it closes, extra capacity will be needed at Cavendish Court and Woodhouse jobcentres? In the light of that need for extra capacity, will he produce figures showing whether there will actually be any net saving as a result of the closure of Eastern Avenue?
Mr Speaker
It is very cheeky to ask three questions even when asked with the skill and confidence of the Chair of the Select Committee.
Damian Hinds
I hope that I can provide the hon. Gentleman with some comfort. First, let me say that saving money is not a bad thing in itself; it is a good thing, and this overall programme will save some £180 million nationwide. That means that we can reinvest in frontline staff, which will have the biggest effect on helping people to return to work. As for the specific case of Sheffield, the changes will increase the utilisation of the entire estate from 51% to 69% when some of the business moves, as the hon. Gentleman rightly said, to the other two sites.
Michael Tomlinson (Mid Dorset and North Poole) (Con)
I congratulate the Minister on surviving a recent grilling from young ambassadors at a meeting of the all-party group on youth employment. I welcome the news that fewer young people are unemployed to start with but, at 554,000, the figure is still too high. Will the Minister read the all-party group’s report with a view to ensuring that there are fewer young claimants in the first place?
Damian Hinds
I look forward very much to reading the report. We know that any day spent unemployed can have a lasting effect on people, especially at the start of their careers when they are young, and it is therefore particularly important for us to redouble our efforts.
Louise Haigh (Sheffield, Heeley) (Lab)
It is clear from the Minister’s answer to the question asked by my hon. Friend the Member for Sheffield South East (Mr Betts) that he does not know how much the closure of East Avenue jobcentre will save. We do not know how much rent is being spent there, and we do not know how much needs to be spent on Woodhouse or Cavendish Court to increase capacity for the additional claimants whom they will have to serve. Will the Minister commit himself to giving the House those figures before he makes his final decision and final statement to the House?
Damian Hinds
All the staff and services from Eastern Avenue will move to Bailey Court in West Street and Cavendish Court in Bank Street. I can reassure the hon. Lady that we have, of course, taken account in our projections and modelling of the exact space that will be required for those people and that level of workload.
Mike Freer (Finchley and Golders Green) (Con)
The proposed closure of the Jobcentre Plus at Finchley Central, which is a major transport hub, will mean moving the jobcentre to High Barnet, which is on the periphery of London. That will mean a 40-minute journey and a £3 bus ride for my constituents. Will the Minister agree to revisit these proposals?
Damian Hinds
We have embarked on a programme of change which comes at the end of a 20-year private finance initiative contract. There is both an opportunity and a requirement to review what is needed on the estate. Rents are particularly high in London, and are therefore particularly challenging in the commercial market. We have sought to minimise the effect on claimants, to ensure that there is a good coverage of services within reach, and to run a consultation when a new jobcentre is more than 3 miles away and a journey on public transport takes more than 20 minutes.
Heidi Alexander (Lewisham East) (Lab)
The Minister for Employment (Damian Hinds)
Throughout the development of these proposals, we have been mindful at every turn of the impact on staff and customers. Both statistical analysis and local knowledge have informed the proposals, which are still subject to consultation with staff and, when appropriate, with the public.
Heidi Alexander
Nearly a quarter of the jobcentres earmarked for closure are in London, and, as the Minister will know, both the disability and the black and minority ethnic unemployment rates are higher in the capital than elsewhere. Is the reason for the delay in the equality impact assessment the fact that it will show a disproportionate impact on the groups that typically need the most support to gain access to employment?
Damian Hinds
No, we have been mindful throughout of our duties under section 149 of the Equality Act 2010. Equality analysis will help to inform the final decision-making process, and it is an integral part of the thinking and process throughout.
Ben Howlett (Bath) (Con)
Following the publication of the Women and Equalities Committee report on Muslim women in the workplace, what work is the Minister doing to ensure that minority groups in which unemployment remains stubbornly high are prioritised at jobcentres across the UK?
Damian Hinds
There are a number of very good local projects working with local organisations. I do not have the list in front of me, but there is some good work going on, and we seek to find where best practice exists and see how far it can be replicated.
Rosie Cooper (West Lancashire) (Lab)
Diana Johnson (Kingston upon Hull North) (Lab)
The Parliamentary Under-Secretary of State for Pensions (Richard Harrington)
I give the same answer I gave to the hon. Member for Ross, Skye and Lochaber (Ian Blackford): the Government have been clear that the introduction of further transitional arrangements cannot be justified, given the imperative to focus public resources on helping those who are most in need. There are no plans to go beyond the £1.1 billion concession introduced when Parliament considered the changes.
Rosie Cooper
In response to the Minister’s answer, I ask him whether he will respond to the comments of his Government’s former Pensions Minister Baroness Altmann, who said she regretted the Government’s failure to properly communicate state pension age equalisation, an approach she described as
“a massive failure of public policy”,
and the comments of Steve Webb, another of their former Pensions Ministers, who said that the last Government made a bad decision on changing the state pension age? Will the Minister look at rectifying that?
Richard Harrington
In the latter case, Steve Webb was Pensions Minister at the time, so I do not think there is much further I can say about that.
There were very extensive communications on the 1995 changes. Millions of people checked their state pension requirements; it was publicised and leaflets were produced. This has been said many times on the Floor of the House, and I simply reiterate it.
Diana Johnson
It is not good enough for the Minister to say, as he did earlier, that that is it for the WASPI women and that everything has been done that is going to be done. Has he given any consideration to the recommendation from the Work and Pensions Committee talking about allowing the WASPI women the chance to claim their pensions early at a reduced rate, which I believe is cost-neutral and fits with other areas where the Government have allowed pensioners to take their pensions earlier at a reduced rate?
Richard Harrington
The proposal is not cost-neutral; I must make that clear. It is very impractical and it is impossible to do in the time concerned. I have made it very clear that the transitional arrangements that were made when the Pensions Bill went through Parliament are all that will be provided.
Sir Desmond Swayne (New Forest West) (Con)
What was the minimum notice received by those facing the maximum increase in age?
Richard Harrington
These changes took place under two Acts of Parliament: the Pensions Act 1995, which brought in the main change, and the Pensions Act after that. I want to make it clear that after the 1995 Act, 18 months was the maximum increase.
Graham Evans (Weaver Vale) (Con)
Last week, the John Cridland report indicated that there may well be an increase in the pension age. As life expectancy rises, it is right and proper for any Government to consider increasing the state pension age. However, will my hon. Friend reassure the House that if there are indeed any changes to the state pension age, they will be communicated in a timely and appropriate manner, so that those affected know about them?
Richard Harrington
The Government will be making a full response to the Cridland report. The review is forward-looking and, I must make it clear, will not make recommendations for any changes to happen before 2028. That was a commitment in the 2013 autumn statement.
Rob Marris (Wolverhampton South West) (Lab)
Richard Harrington
There is a lot happening in pensions at the moment. The point the hon. Gentleman mentions in relation to the Chancellor of the Exchequer is something completely different, but there will be no change to the transitional arrangements at £1.1 billion.
Alex Cunningham (Stockton North) (Lab)
Labour will oppose the earlier increase in the state pension age and the end of the triple lock, recommended in last week’s Cridland report, but we welcome the statement from John Cridland that at least 10 years’ notice should be given of any age increase, so there is yet another chance for the Minister. Do the Government agree with Cridland? If they do, will the Minister now admit that they got it badly wrong with the WASPI women and at least back Labour’s proposals to extend pension tax credit?
Richard Harrington
As I said before, the Government will respond to the Cridland review by the end of May.
Steven Paterson (Stirling) (SNP)
Gavin Newlands (Paisley and Renfrewshire North) (SNP)
Kirsten Oswald (East Renfrewshire) (SNP)
The Secretary of State for Work and Pensions (Damian Green)
Every Government Department is preparing for a smooth and orderly exit from the European Union. We are confident that we will be able to secure a deal that works in the mutual interests of both the UK and the rest of the EU. We are considering various policy options.
Steven Paterson
Some 472,000 people who have retired to the EU currently get automatic increases in the state pension, but it is unclear whether this Government will strike a deal on that after departure from the EU, if they manage to do so. Can the Minister guarantee today that elderly EU expats will not join the 550,000 retirees whose payments no longer increase in line with the state pension triple lock?
Damian Green
The Prime Minister has been clear that she wants to protect the rights of British citizens currently living in European member states, in the way that we want to protect the status of EU nationals already living here. That will clearly be an important matter for negotiation in the months ahead.
Gavin Newlands
Does the Secretary of State agree that his Government have form on failing to protect workers’ rights? Any illusion about ability to deliver social justice for workers went up in smoke with the Dickensian Trade Union Act 2016. How can we trust his Department to guarantee workers’ rights after article 50 is triggered?
Damian Green
I am glad that the hon. Gentleman has drawn the House’s attention to the fact that the Government have pledged to maintain workers’ rights in the course of the negotiations. I am happy also that he gives me the chance to remind the House that the greatest workers’ right is the right to a job, and that employment is at its highest ever level in this country.
Kirsten Oswald
Reports at the weekend suggest that the UK Government intend that EU migrants currently living here will retain access to benefits, but those who arrive after the triggering of article 50 will be denied access. Does the Secretary of State agree that that is actually dependent on the will of the EU member states, and his Government cannot guarantee any of those rights as they press ahead, dragging us into the unknown without any credible plan?
Damian Green
I am sure the hon. Lady knows that no one standing at this Dispatch Box would ever comment on speculative leaks. She will know as well that we are about to enter a negotiation. We are confident that we will get a good result for the people of Britain, and that is what we will be doing.
David Mackintosh (Northampton South) (Con)
The Parliamentary Under-Secretary of State for Welfare Delivery (Caroline Nokes)
The evaluation of the previous cap speaks for itself: capped households were 41% more likely to move into work than similar uncapped households, contributing to the record levels of employment we see today. Since 2013, over 26,000 previously capped households have moved into work.
David Mackintosh
Can my hon. Friend give me some examples of how the benefit cap is working in my constituency?
Caroline Nokes
In Northampton South, of 110 house- holds capped since April 2013, 90 are no longer capped. Of those, about 48%—40 households—have moved into work, demonstrating that my hon. Friend’s constituency is outperforming the national average.
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
The Secretary of State for Work and Pensions (Damian Green)
I would like to draw the attention of the House to the more generous universal credit taper rate coming into effect over the Easter recess, on 10 April. It demonstrates our commitment to helping people to gain independence in their own lives by getting on and progressing in work. The new taper rate of 63% will boost the incomes of about 3 million families by £700 million a year; a couple with two children could benefit by as much as £425 a year. When combined with the introduction of the national living wage and increases in the personal tax allowance, those changes equate to the biggest pay rise for the lowest earners in a generation.
Chi Onwurah
Newcastle has paid a high price for being the first city to go full service with universal credit, with claims routinely lost, delayed or repeatedly deleted. However, the six-week wait period is doing the most to drive so many into destitution and cause people to lose their home. With 80% of Newcastle council house tenants on universal credit now in rent arrears, will the Minister end the wait period, or will he explain how they are supposed to keep a roof over their head with no money?
Damian Green
I have two points for the hon. Lady. First, the National Federation of ALMOs—social housing providers—calculates that some 75% of tenants are in arrears under the legacy benefits, so she is not right in her suggestion.
Damian Green
Yes, quite; this has been happening for a long time. The idea that universal credit causes housing arrears is just nonsense.
Secondly, the hon. Member for Newcastle upon Tyne Central (Chi Onwurah) will know that my Department is working on a pathfinder arrangement with Newcastle City Council precisely to address the problems that may be there now and have been there for many, many years.
Mrs Sheryll Murray (South East Cornwall) (Con)
The Minister for Employment (Damian Hinds)
I welcome the news from my hon. Friend’s constituency, which has seen such a strong fall in unemployment. I certainly acknowledge the key role played by third sector organisations. We continue to work with outside organisations and on programmes such as work experience, sector-based work academies, the new youth obligation and, of course, the roll-out of universal credit.
Debbie Abrahams (Oldham East and Saddleworth) (Lab)
We heard earlier about the cuts to PIP support for people with mental health conditions that were brought in 10 days ago. The Government estimate that they will affect 160,000 people. This time next week, half a million sick or disabled people who have been found not fit for work and have been placed in the employment and support allowance work-related activity group will start to see a cut in support of £1,500 a year. Given that disabled people are twice as likely to live in poverty as non-disabled people and the recent analysis showing that that has increased significantly, how does the Secretary of State justify the cumulative cuts to disabled people?
Damian Green
First, when the hon. Lady talks about cuts to 160,000 people, she is of course wrong. Nobody’s original DWP award will receive a cut. She also asked me how I justify the changes to ESA, but disabled people and people with health conditions deserve better than the current system, under which only one in 100 ESA WRAG claimants leave benefit each month. I hope that the hon. Member for Stockton North (Alex Cunningham), who is cheering from a sedentary position, agrees with me that we need to change the system. That is why we are proposing a huge number of different types of help across the board, including financial help and advice, which will help them into work.
Lucy Allan (Telford) (Con)
The Minister for Disabled People, Health and Work (Penny Mordaunt)
I can give my hon. Friend that assurance. There will be no change to award amounts, the budget or the policy. The benefit does not relate to a particular condition, but to how a condition has an impact on someone’s life. It is about the social definition of disability. I assure her constituents that that will continue to be the case.
Owen Thompson (Midlothian) (SNP)
Damian Hinds
Universal credit is a massive reform. I know of no other country with a comparable system that stays with people from being out of work to supporting them in work. Are there challenges in implementing that? Yes, of course there are, but the transformational benefits in sight are immense.
Sir Henry Bellingham (North West Norfolk) (Con)
Damian Hinds
I take that point on board, and we are embarking on a number of co-locations as part of the current programme. Co-location can be good both for claimants and for the taxpayer: for claimants because more of the services they need to access are in one place, and, of course, for the taxpayer by making better use of the public estate.
Gill Furniss (Sheffield, Brightside and Hillsborough) (Lab)
The Parliamentary Under-Secretary of State for Welfare Delivery (Caroline Nokes)
The hon. Lady will of course be aware that tax credits fall within the remit of Her Majesty’s Treasury, and I will be happy to ensure that that is raised with the relevant Minister.
Mr Speaker
Forgive me, I could not hear the Secretary of State and did not lip read effectively, but I now realise at what he was hinting. No doubt an answer will be furnished in due course.
Mr David Hanson (Delyn) (Lab)
Damian Hinds
I cannot comment on an individual case, but I can say that, in general, we know that less than 3% of people report that they rely on a zero-hours contract. We know that, on average, those people get 25 hours a week and actually have above-average levels of job satisfaction. Zero-hours contracts are certainly not for everybody, but they do work for some people.
Huw Merriman (Bexhill and Battle) (Con)
Penny Mordaunt
I thank my hon. Friend not only for signing up to be a Disability Confident employer himself but for accepting that challenge, as many Members on both sides of the House have. If every Member of this House accepted the challenge, we would sign up enough employers to reach a quarter of the working population of the UK. I thank him for his leadership in that and wish him well on his visit to his chamber of commerce.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
Damian Green
The hon. Gentleman has made his point very forcefully. I am, of course, in constant discussion with ministerial colleagues in the Home Office about a wide range of issues involving the labour market.
Maggie Throup (Erewash) (Con)
Damian Hinds
We have female employment at a near record rate, which is to be celebrated. We have seen the gender pay gap come down, but there is more work to do. A number of things have to fall into place for that to happen, but one of the key things happening this year is, of course, the extension of childcare to 30 hours a week for three and four-year-olds. Parents on universal credit get 85% reimbursement, rather than 70%, and we have tax-free childcare, too.
Thangam Debbonaire (Bristol West) (Lab)
The Fawcett Society found last year that 25% of women over 30 are saving nothing for retirement, compared with 15% of men. What does the Secretary of State think is responsible for that, and what is he doing to change it?
The Parliamentary Under-Secretary of State for Pensions (Richard Harrington)
Automatic enrolment was designed specifically to help those who were under-represented in pension savings, including women. With the current rate of £10,000 a year, 70% of the new people coming into the system in 2017-18 will be women.
Kate Green (Stretford and Urmston) (Lab)
Six out of 10 people with epilepsy who were migrating from DLA to PIP and were surveyed by Epilepsy Action saw their benefit removed or reduced. That compares with two out of 10 people who are migrating overall. Are Ministers confident that assessors and decision makers properly understand the fluctuating, sporadic and life-limiting condition of epilepsy, so that they can make the right decisions?
Penny Mordaunt
We are aware of that. That is one reason why we have increased the clinical support that is available to assessors. They are all healthcare professionals, so they will have that expert advice on hand in the assessment centres. That is something that we brought in recently.
Ms Tasmina Ahmed-Sheikh (Ochil and South Perthshire) (SNP)
Has the Secretary of State watched or listened to an appeal hearing for PIP applicants? I have received information and representations from a number of constituents who feel intimidated and misrepresented by the process. What steps is he taking to ensure that the people involved in the process are treated with the respect, dignity and compassion that they deserve?
Penny Mordaunt
I thank the hon. Lady for her comments. We think about every stage of this process. Clearly, if people appeal and those appeals are upheld, we have not got it right earlier in the process. I have mentioned some things that we are doing to build trust, confidence and support. We are also introducing a video relay service in April, which will be of particular help to those who are deaf or hard of hearing. There are a number of small changes like that that we can make to ensure that we get a good result earlier in the process.
Catherine McKinnell (Newcastle upon Tyne North) (Lab)
I have a 28-year-old constituent who was injured in the line of duty in 2010. He was awarded a tier 3 military pension, which is reserved only for the most severely injured, but he is due to lose his Motability vehicle and that decision was upheld on mandatory reconsideration. Is that seriously the type of person the Government wish to leave housebound?
Penny Mordaunt
I would say two things in response to that question. First, we have been considering particular issues around our armed forces in the Green Paper, which gives opportunities not just for ESA but for PIP. We are also looking at being able to passport information that may be in someone’s war pension record or medical history into our benefits system. I am quite happy to look at the case the hon. Lady raises with regard to Motability.
Melanie Onn (Great Grimsby) (Lab)
What does the Minister say to the private landlord who came to see me with his tenant with concerns about future eviction rates if there is no option under universal credit for rent to be paid directly to landlords?
Damian Hinds
There is, of course, the facility for rent to be paid directly to landlords where necessary, and we are streamlining the process for doing that. However, we think that the general principle is right that most people in receipt of universal credit should know what their housing liabilities are and pay their rent when they are out of work and when they are in work.
Stephen Timms (East Ham) (Lab)
We have been reminded that new claimants of employment and support allowance will get a much lower rate of benefit, starting in about 10 days. Some of those people will find themselves in serious difficulty. Do Ministers have any new proposals to help?
Penny Mordaunt
We do. In addition to the support offer, all the elements of which are in place, the Department has been doing a number of things, one of which is a big piece of work on social tariffs, which is about enabling people to have the right tools and information to reduce their household outgoings and giving them budgeting support.
Neil Gray (Airdrie and Shotts) (SNP)
In November last year, my motion calling on the Government to at least pause employment and support allowance cuts until mitigation or Green Paper proposals were brought in was carried unanimously by the House. Given that this is the last parliamentary week before the cuts take place on 3 April, will the Minister confirm whether the mitigations she promised will be laid before the House for scrutiny?
Penny Mordaunt
They are already in place. I think this is a misunderstanding that the hon. Gentleman had. The elements that were outlined in the Green Paper were not speculative or things that we would be consulting on; they were things we were going to do. All the elements, including all the recruitment for all the community partners around the country, are in place now.
Chris Stephens (Glasgow South West) (SNP)
Let me return to the issue of the DWP estate and travel times. Given that this information has been gathered via Google Maps, which has been shown to be inaccurate as some bus services are no longer operational, will the Minister tell me what tests have been carried out to check the accuracy of the information? If there is a possibility of the ministerial guidance being breached, will any further proposed closures will go to public consultation?
Damian Hinds
The hon. Gentleman and I, and many of his colleagues and others from across the House, have had a number of opportunities to debate these matters and to go through individual cases, on individual locations, one by one. We used a variety of sources to determine travel times and “reasonableness” of travel. The ministerial criteria say that if somewhere is within 3 miles or 20 minutes by public transport, it is reasonable to ask somebody to make that journey; otherwise, we have a public consultation.
Several hon. Members rose—
Mr Speaker
Order. Time is against us and we must hear the voice of Batley and Spen.
Tracy Brabin (Batley and Spen) (Lab)
Thank you, Mr Speaker.
A constituent of mine, whom I have spoken of before, lost her job on Christmas eve. She is denied universal credit because she is over 60 and she is denied jobseeker’s allowance because her husband has a small private pension. This couple’s lives have been thrown into financial turmoil. Does the Minister agree that it is time the Government paid some compensation to this constituent, as she has paid in all her life?
Damian Hinds
Jobseeker’s allowance or universal credit should be available to people of working age. I will have to look at the details of the case the hon. Lady mentioned, if she would like to get in contact.
Magnox: Early Contract Terminations
(7 years, 1 month ago)
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Rebecca Long Bailey (Salford and Eccles) (Lab)
(Urgent Question): To ask the Secretary of State for Business, Energy and Industrial Strategy if he will make a statement on the Nuclear Decommissioning Authority’s early contract terminations at the Magnox estate?
The Secretary of State for Business, Energy and Industrial Strategy (Greg Clark)
This morning, I informed the House that the NDA has terminated its contract with the Cavendish Fluor Partnership for the decommissioning of 12 redundant Magnox sites. The NDA ran a £6.1 billion tender process from April 2012, which resulted in a 14-year contract being awarded in September 2014 to the partnership, which is a joint venture between the British firm, Cavendish Nuclear, and Fluor Inc.
CFP started work on the estate on 1 September 2014 and there then started a consolidation process to ensure that the scope of the 2012 tender matched the actual status of decommissioning. It became clear to the NDA that there is a significant mismatch between the work that was tendered for and the actual scale of the work that is required to be carried out. The NDA board concluded that it should terminate the contract on two years’ notice. Termination is made with the agreement of CFP and is no reflection whatsoever on its performance.
Dealing safely with the UK’s nuclear legacy is fundamental and non-negotiable. Decommissioning work will continue under CFP for a further two and a half years. The NDA will establish arrangements for a replacement contracting structure to be put in place for when the current contract ends. The NDA has also settled outstanding claims against it by Energy Solutions and Bechtel in relation to the 2014 Magnox contract. The NDA was found by the High Court to have wrongly decided the outcome of the procurement process. It is clear that the 2012 tender process was deeply flawed. The NDA has agreed settlement payments with Energy Solutions of £76.5 million, plus £8.5 million of costs, and with Bechtel of $14.8 million, plus costs of about £462,000—approximately £12.5 million in total.
Those are very substantial costs, which could have risen further if the case had proceeded. Taxpayers must be able to be confident that public bodies are operating effectively and securing value for money. Where that has not been achieved, such bodies should be subject to rigorous scrutiny. I have therefore established an independent inquiry into the original procurement process and why the 2014 contract proved unsustainable. Those are separate issues, but they need to be examined thoroughly. I have asked Mr Steve Holliday, the former chief executive of National Grid plc, to lead this inquiry. It will take a cradle-to-grave approach, beginning with the NDA’s procurement and ending with the contract termination. The inquiry will set out the lessons learned and recommend any further actions it sees fit, including any disciplinary investigations or proceedings that may be appropriate. The inquiry will report jointly to me and to the Cabinet Secretary, and his report will be available to this House and to the Select Committee.
This was a defective procurement with significant financial consequences, and I am determined that the lessons to be learned should be exposed and understood; that those responsible should be properly held to account; and that this should never happen again.
Rebecca Long Bailey
The NDA has withdrawn its appeal against the judgment that was handed down in late July last year, so will the Secretary of State explain why this decision has been taken now, why the matter was brought to appeal in the first instance, and whether both actions were sanctioned by him or his predecessor?
The judgment confirmed that the NDA had not acted properly in the tender process, and that it was
“acutely aware that an unsuccessful bidder might challenge the outcome of the competition.”
The court stated that the NDA had fudged the evaluation to achieve a particular outcome. More worryingly, the judge also confirmed that the NDA attempted to get rid of information that might have been detrimental to its case, and there was reference to the shredding of notes. Given the serious nature of the judgment, will the Secretary of State assure the House that there will be full public disclosure of the investigations, and a public hearing? Does he agree that this case has called into question the future operation of the NDA? Will he explain what structural changes are necessary, and when? Can he offer any assurances to Magnox workers?
Finally, the Secretary of State’s written statement confirms:
“It has become clear to the NDA…that there is a significant mismatch between the work that was specified in the contract as tendered in 2012”.
Will he tell the House when he or his predecessor was first aware of that mismatch and whether it would have been apparent from the work that had already been carried out by previous contractors?
Greg Clark
The hon. Lady is quite right to ask her questions, and I hope she will agree that the written ministerial statement I have made today is thorough and comprehensive. I am very happy to have conversations with her and the Select Committee over the weeks and months ahead.
The hon. Lady asked some specific questions about the termination of the contract and the litigation. On the latter, there was indeed a Court hearing and judgment in July last year, and there was another one in December on which the NDA has reflected. On 1 March this year—a few weeks ago—a new chief executive and chair of the NDA took office. It seemed to me appropriate that a new set of eyes should consider these matters and the course of action, rather than those people who were responsible for and involved in the procurement exercise looking into it. In answer to the hon. Lady’s question, it was a decision for the NDA board—that is how it is constitutionally established—but its decision required ratification by me, the Chief Secretary to the Treasury and the accounting officer in my Department.
The hon. Lady asked some very important questions about the conduct of the original procurement process and its management. That is exactly why we need to have an independent figure—independent of Government and of the NDA—to make a report available to the House, to me and to the Cabinet Secretary, not only so that we can learn the lessons and ensure that things cannot happen again, but so that, if there is fault and an error has been made, the recommendation of disciplinary action can follow.
The hon. Lady rightly asked about the Magnox workforce, for whom this will be a difficult day. I am happy to confirm to the House that there is no question about the operational good performance of the contract; it was a question of the terms of the letting of the contract. Good progress has been made, and the workforce employed on the decommissioning contract will continue as planned. When the report is made available, lessons will be learned about the NDA’s structure, as well as any particular procedural aspects.
Mr John Whittingdale (Maldon) (Con)
Will my right hon. Friend join me in paying tribute to the workforce at Bradwell-on-Sea in my constituency? They are doing a magnificent job in decommissioning the power station there. Will he confirm that nothing in his statement will prevent that work from continuing? Will he also listen to their concerns about the effect on their pension entitlements of certain changes that have been made regarding the cap on exit payments?
Greg Clark
I join my right hon. Friend in paying tribute to the workforce. As he will be aware, good progress has been made in decommissioning the site in Bradwell, with the underground waste vaults containing intermediate level waste having been cleared and decontaminated. That is a reflection of the hard work. There is a separate set of discussions and consultations going on with regard to the pension arrangements, which is not related to today’s announcement.
Margaret Ferrier (Rutherglen and Hamilton West) (SNP)
I thank the Secretary of State for his response and the shadow Secretary of State for securing this urgent question. This debacle shows that the UK Government cannot even manage their current nuclear project, which comes at great cost to the taxpayer, leaving their case for a nuclear energy future more threadbare than ever. Given the bizarre and illogical decision to leave Euratom, the trade union Prospect is right to be concerned and to seek reassurances that uncertainty over the future of decommissioning will not lead to a deterioration in standards. What assurance can the Secretary of State give today?
This should be a wake-up call. The UK Government’s nuclear obsession will do nothing to lower energy bills and will only burden the next generation with unprecedented economic, environmental and security instability and risk. The Tories should do the responsible thing and scrap their nuclear obsession in favour of investment and renewable energy in carbon-capture technology. Scottish Renewables recently reported that one in six renewable energy jobs in Scotland will be under threat in the next year. Will the Government acknowledge that their energy policies need to be reviewed to allow the Scottish Government to continue with their competent and ambitious vision of a prosperous green future? Finally, when can we expect full details of the timetable of the investigation into this matter?
Greg Clark
A little humility might be appropriate here, because the Scottish Government provided oversight of this procurement as part of the NDA competition programme board. I am sure that the lessons to be learned from 2012 to 2014 also apply to the Government in Scotland. I am sure that, whatever the view on future new nuclear power, the people of Scotland, as well as those of the whole of the United Kingdom, would want the existing nuclear power stations to be decommissioned safely and to have arrangements in place to ensure that that can be done reliably. On the independent review, which I hope the hon. Lady welcomes, I have asked Mr Holliday to give some interim findings by October, so that they can inform the further decisions about the re-letting of the contract.
Sir Oliver Letwin (West Dorset) (Con)
I am sure that my right hon. Friend will pay no attention whatsoever to the bizarre asseverations of the Scottish National party spokesman. In asking Steve Holliday, in whom we have considerable confidence, to do this review, I hope that my right hon. Friend will seek to bring the review to a final conclusion reasonably soon after the interim report in October so that we can get to the bottom of this matter and ensure that it does not repeat itself in future years.
Greg Clark
I agree with my right hon. Friend: it is important quickly to learn the lessons and to apply them. This is very important work. The work is being carried out to a high standard, but those lessons must be learned and applied.
Mr Iain Wright (Hartlepool) (Lab)
May I thank the Secretary of State for his courtesy call on this matter this morning and for his subsequent letter? The Business, Energy and Industrial Strategy Committee will challenge hard, but work constructively with him and with Steve Holliday on this important issue. Will he clarify whether the inquiry will be confined to the procurement process, which led to this specific contract? Will it consider other contracts such as the one to decommission Dounreay, which was awarded to essentially the same consortium that won the Magnox contract? I think that he has already confirmed this, but will he say whether the inquiry will be broad enough to consider whether the governance and management arrangements of the NDA have always been, and will continue to be, fit for purpose?
Greg Clark
I am grateful to the Chairman of the Select Committee for what he said. I can confirm that the governance and the management arrangements of the NDA are very much in scope. I put the terms of reference in the Library of both Houses of Parliament this morning. It is open to Mr Holliday to go where the evidence takes him—to use that phrase on this. The particular concern is over this contract, but if he feels that he needs to look at other aspects of the NDA’s management, he is absolutely free to do so.
Edward Argar (Charnwood) (Con)
I welcome the characteristic candour and openness with which the Secretary of State has approached the issue. Will he reassure me and the House that the scope of the inquiry will look not only at the NDA, but—as I think he just alluded to—at the role, if any, of UK Government Departments and the Scottish Government in the process?
Greg Clark
I will, indeed. The terms of reference that were published with my written statement this morning make it very clear that, as is absolutely right and proper, the inquiry applies to the NDA and Government Departments, from the beginning of the procurement in 2012 to the conclusion of the litigation and the termination of the contract.
Liz Saville Roberts (Dwyfor Meirionnydd) (PC)
Under current plans, Trawsfynydd power station will lose most of its jobs in less than 10 years. The Government are now in a position to commit to a programme of continuous decommissioning, as recommended by the Select Committee on Welsh Affairs. When will the Secretary of State publish revised plans following today’s announcement, and will he agree to meet me to discuss the future of the Trawsfynydd site?
Greg Clark
I will certainly meet the hon. Lady. I am glad that she has given me the opportunity to emphasise that the work will continue as planned at all the sites. As she will know, work is ahead of schedule in the plant she mentioned. In the light of that, I will meet her to update her on the latest timings.
Antoinette Sandbach (Eddisbury) (Con)
This was clearly a defective procurement with quite serious financial consequences. I welcome the Secretary of State’s determination that the reasons will be exposed, but will he assure the House that people found to be responsible or at fault will be brought to account?
Greg Clark
I can confirm that the terms of reference make it very clear that the inquiry can make any recommendations that it sees fit, including as to any disciplinary investigations or proceedings that may, in its view, be appropriate as a result of its findings.
Catherine West (Hornsey and Wood Green) (Lab)
Will the Secretary of State please confirm that the thousands of people waiting for an outcome on their pensions will not be ripped off?
Greg Clark
Yes. There have been constructive discussions with the representatives of the workforce. Those discussions and consultations continue. Of course, we want to bring them to a satisfactory conclusion.
Mike Freer (Finchley and Golders Green) (Con)
The NDA settlement payments are very substantial. Will my right hon. Friend confirm that although the payments were made without accepting liability, the cost had the potential to rise much further were the matter taken to court?
Greg Clark
My hon. Friend is absolutely right. We have a duty to consider the further risks to public money, which is why my accounting officer, the Chief Secretary to the Treasury and I accepted on advice that, however painful it is—these are significant sums of money, as my hon. Friend the Member for Finchley and Golders Green (Mike Freer) said—we should prevent the sums of money from being even greater.
Rob Marris (Wolverhampton South West) (Lab)
Given the cost problems with the NDA’s Magnox decommissioning contract, how can the Secretary of State have any confidence whatever in the cost figures for Hinkley Point C, which will itself need decommissioning, especially given the farce of the massive cost overruns and huge time delays in building the EDF sister reactors in Finland and Normandy, neither of which has yet opened and each of which is years late?
Greg Clark
This is about a procurement process that was mis-specified around decommissioning; it is not against the build costs of a future reactor. If Steve Holliday’s report includes wider lessons for the industry, we will be sure to take them.
Huw Merriman (Bexhill and Battle) (Con)
All public sector organisations can learn much from procurement processes and public-private initiatives, as the £3,700 a minute spent by the NHS on private finance initiatives would attest. Will the Secretary of State assure me that all public sector organisations will be given the opportunity to learn best practice from the Holliday review?
Greg Clark
I will. It is important when there is such a serious set of consequences for public money that the conclusions should be publicly available, and available to this House and to other Government Departments that may want to reflect on them.
Mr David Nuttall (Bury North) (Con)
Will the Secretary of State confirm that the Holliday inquiry will have reached its final conclusions and issued its final report in time for any lessons learned to be taken into account before the new contract process begins?
Greg Clark
One reason I have asked Mr Holliday to make a report by October is so that that can happen. I will meet him in the coming days, as he sets out the scope and timetable, but that is one of the key reasons for the report, and I am sure he will want to make his recommendations available for the new process.
Mr Dennis Skinner (Bolsover) (Lab)
What were the terms of the pay-off? The Secretary of State has not mentioned it.
Greg Clark
I have mentioned the settlement—it is nearly £100 million for the settlement of the litigation. The chief executive of the NDA has come to the end of his contract.
Declarations of Interest
Andrew Bridgen (North West Leicestershire) (Con)
On a point of order, Mr Speaker. Following a report made on 14 February by the Parliamentary Commissioner for Standards, I would like to apologise to the House for the failure to disclose a financial interest in a Westminster Hall debate on High Speed 2 on 25 March 2015. I should have declared that, owing to a court order caused by my divorce, I was in the final act of selling my house to HS2 under the extreme hardship scheme. I point out to the House that I did declare an interest in the previous HS2 debates on 28 January 2013, 26 June 2013 and 28 April 2014.
In addition, I should, on reflection, have declared an interest when I submitted a written question to the Transport Secretary on 9 October 2013 and when I spoke in the High Speed Rail (Preparation) Bill debate on 31 October 2013. I also attended meetings with HS2 and responded to the consultation, when, with hindsight, for purposes of clarity, I should have declared an interest.
I have sought to co-operate with the Commissioner for Standards throughout this inquiry. I have never made any secret of how close HS2 was running to my then property in North West Leicestershire. That in no way clouded my view of the HS2 project, which I opposed before the route was announced, during my interest and afterwards. I thank you for the opportunity to put this all on the record, and I apologise to the House profusely for any omissions I may have made.
Points of Order
(7 years, 1 month ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Ian Blackford (Ross, Skye and Lochaber) (SNP)
On a point of order, Mr Speaker. I would like to raise the issue of correspondence between me and the offices of the Minister of State responsible for universities and the Minister responsible for energy, who is in his place. I first wrote to the Minister of State to request a meeting for a business in my constituency—the Underwater Centre—on 14 November. It took some time to get a reply from the Department. I finally received one on 22 December, with an apology for the lack of a response. There was an unwillingness to meet and a suggestion that I take the issue up with the Minister responsible for energy and industrial supply. I did so on 22 December last year. I have chased his office on several occasions, by email and by phone, and we have yet to receive an email. We indicated to the Minister’s office by email last Friday at 12.33 pm that, given the unsatisfactory nature of the situation, I would be raising it as a point of order. I would like advice on what a Member can do when a Minister’s office wilfully seeks to ignore a request from a Member for a meeting with a company in his constituency.
Mr Speaker
Persist, persist, persist, I say to the hon. Gentleman. That is the advice I give him. His attempted point of order has opened an interesting window into his life, the administrative support he enjoys and the diary commitments—not least around lunchtime last Friday—to which he was subject, for which I am sure the House is immensely grateful, but I do not think we can take the matter any further. He knows that my advice will always be to persist—he himself is nothing if not a dogged terrier.
Mrs Maria Miller (Basingstoke) (Con)
On a point of order, Mr Speaker. In the past few days, almost 1,000 people have been arrested, beaten or imprisoned in Belarus—a country still under an effective dictatorship here in Europe. How can we show our solidarity with those in Belarus who are fighting for democracy, for freedom of speech, and for the rule of law?
Mr Speaker
I struggle immediately to see how the right hon. Lady’s observations constitute a point of order. That said, I recognise and respect the seriousness of her concern, and I acknowledge on the Floor of the House her long-standing track record of support for the Belarus Free Theatre. My initial answer is that I think that, by persistence and the good fortune of the ballot, she has probably secured her own salvation, and possibly an opportunity to press for the salvation of those who need it more intensely and immediately, because she has Question 9, if memory serves, at Foreign Office and Commonwealth questions tomorrow. I cannot anticipate the sequence of events, but it wold be a very unfortunate and unsatisfactory Foreign Office questions if we did not get to Question 9. I think I can say with some confidence that we will, and that the right hon. Lady, speaking on behalf of those people who need her help and will value it, will have her chance. What is more, if she expresses herself with her usual force, clarity and eloquence, she might motivate other right hon. and hon. Members to spring to their feet with supplementary questions following her own. If so, I will be all eyes and all ears.
Chris Bryant (Rhondda) (Lab)
On a point of order, Mr Speaker. As you know, at 4 o’clock the deadline passed in Northern Ireland. I do not want to make any accusations against the Government, but the Secretary of State for Northern Ireland is making a statement elsewhere about what he expects now to happen in Northern Ireland, and I wonder whether you have had any notification of a statement to the House so that the House can express a view.
Mr Speaker
I am very grateful to the hon. Gentleman. The short answer is that I have not received any indication that the Secretary of State is minded to come here. From the record of dealing with this Secretary of State—this particular right hon. Gentleman—I can say that he has always been fastidious in wanting to come to the House, often telephoning me and trying to make contact. Indeed, I am advised that he has sought to make contact with me by telephone. I have, however, received no written communication from him at all and no indication of an early statement. I think that one would have been forthcoming anyway, and in the light of my exchange with the hon. Gentleman I feel even more confident that it will be.
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Jesse Norman)
Further to the point of order raised by the hon. Member for Ross, Skye and Lochaber (Ian Blackford), Mr Speaker. I am afraid that I did not have notice of it, and I was not clear from what he said whether it was me to whom he referred. If it was, I would of course be delighted to meet him to discuss the issue he raised.
Ian Blackford
I am grateful for that clarification, but just to be absolutely clear—
Mr Speaker
No, no, no—no additional clarity is required. The hon. Member for Ross, Skye and Lochaber (Ian Blackford) is a very cheeky fellow. A simple nod of the head would suffice, which he has provided. In my experience, the Under-Secretary for Business, Industry and Industrial Strategy is as courteous as Members in this place come, so I think we will leave it that the hon. Member for Ross, Skye and Lochaber and the Minister will get together, possibly over a cup of tea, and discuss these important matters.
Bus Services Bill [Lords]
Monday 27th March 2017
(7 years, 1 month ago)
Commons ChamberRead Full debate Bus Services Act 2017 View all Bus Services Act 2017 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Consideration of Bill Amendments as at 27 March 2017 - (27 Mar 2017)
17:01 - The House divided: - Ayes: 193 / Noes: 278 - Question accordingly negatived.
17:15 - The House divided: - Ayes: 193 / Noes: 277 - Question accordingly negatived.
18:58 - The House divided: - Ayes: 188 / Noes: 276 - Question accordingly negatived.
Daniel Zeichner (Cambridge) (Lab)
I beg to move, That the clause be read a Second time.
Mr Speaker
With this it will be convenient to discuss the following:
New clause 2—Report on the provision of concessionary bus travel to apprentices aged 16 to 18—
‘(1) The Secretary of State must, within 12 months of the day on which this Act is passed, lay a report before each House of Parliament setting out possible steps to support local transport authorities in providing concessionary bus travel to persons aged 16 to 18 who are participating in statutory apprenticeships.
(2) Any report under subsection (1) shall include, but will not be limited to, an evaluation of whether section 93(7) of the Transport Act 1985 should be amended to enable local transport authorities to provide concessionary bus travel to persons aged 16 to 18 who are participating in statutory apprenticeships on the same terms as that which may be provided to persons aged 16 to 18 receiving full-time education.
(3) In this section—
(a) “local transport authorities” has the meaning given in section 108(4) of the Transport Act 2000; and
(b) “statutory apprenticeships” has the meaning given in section A11 of the Apprenticeships, Skills, Children and Learning Act 2009.’
This new clause would require the Secretary of State to publish a report setting out possible steps to support local transport authorities to provide concessionary bus travel to apprentices aged 16 to 18.
New clause 3—Assessment of possible concessionary travel schemes: impact on use of bus services—
‘(1) A local transport authority that does not provide travel concessions under a scheme established under section 93 of the Transport Act 1985 to persons specified in subsection (7)(c) of that section shall be required to prepare an assessment of the impact of establishing such a scheme on the use of bus services by persons specified in that subsection.
(2) Any assessment under subsection (1) shall consider, but will not be limited to, the impact of establishing such a scheme on—
(a) the ability of persons aged 16 to 18 to attend schools and further education institutions by means of bus travel,
(b) the cost of bus travel to persons aged 16 to 18 receiving full-time education, and
(c) traffic congestion and emissions at peak times in the local transport authority’s area.
(3) In this section—
(a) “travel concessions” has the meaning given in section 112 (1)(f) of the Transport Act 1985; and
(b) “local transport authority” has the meaning given in section 108(4) of the Transport Act 2000.’
This new clause would require local transport authorities to assess how creating an authority-wide travel concession scheme for 16 to 18-year-olds in full-time education would affect how these students use bus services.
Daniel Zeichner
New clause 1 stands in my name and those of my hon. Friends the Members for Middlesbrough (Andy McDonald), for Birmingham, Northfield (Richard Burden) and for North West Durham (Pat Glass). It would require that the Secretary of State for Transport publish a national strategy for local bus services within 12 months of the day on which the Act is passed, setting out the objectives, targets and funding provisions for buses over the next 10 years. It would also require that the national funding strategy include a consideration of a reduced fare concessionary scheme for young people aged 16 to 19.
New clauses 2 and 3, in the name of the hon. Member for Southport (John Pugh), also relate to bus funding generally, and to young people’s concessionary fares specifically. New clause 2 would require the Secretary of State to lay a report before Parliament setting out possible steps to support local transport authorities in providing concessionary bus travel to apprentices aged 16 to 18, and new clause 3 would require local transport authorities to assess how creating an authority-wide travel concession scheme for 16 to 18-year-olds in full-time education would affect the way in which students use bus services.
It is clear that a long-term national discussion from central Government on the funding of the bus industry is long overdue. Since the bus market in England outside London was disastrously deregulated in the 1980s by a Conservative Government, public support for bus services has been provided in a far from transparent way. The effects of deregulation have been stark.
Judith Cummins (Bradford South) (Lab)
Does my hon. Friend agree that the drop of more than half in passenger journey numbers in Yorkshire and Humber since 1985 is no coincidence—it is down to deregulation?
Daniel Zeichner
I very much agree with my hon. Friend, and I will return to other examples of the failure of deregulation in a moment. It is not just about the number of services. Fares have risen faster than inflation, and patronage overall has fallen by more than a third. Bus market monopolies have become the norm in far too many places.
Back in October, we noted the 30th anniversary of bus deregulation, but it was far from a cause for celebration. It meant 30 years of bus users being ripped off by a handful of big bus operators, which have carved the market into chunks and which go largely unchallenged in their own territories.
Catherine West (Hornsey and Wood Green) (Lab)
Does my hon. Friend agree that for people on low incomes in rural areas, and in some urban areas as well, it is almost impossible to job hunt without a decent bus service?
Daniel Zeichner
Once again, I agree with my hon. Friend. In too many parts of the country, it has become very difficult for people to get to and from work. Throughout the 30 years since deregulation, fares have shot up even at times when fuel prices have been falling. For 30 years, while patronage in the still-regulated capital increased, passenger numbers declined in the rest of England.
This month, the Campaign for Better Transport published its latest “Buses in Crisis” report. The organisation made more than 100 freedom of information requests to local councils to get a full picture of recent bus cuts, and it found that funding for buses across England and Wales has been cut by 33% since 2010, and by nearly £30 million in just the last year. Last week I was in Somerset, where support from the county council will fall by another 19% next year. Across the country, more than 500 routes were reduced or completely withdrawn in 2016-17.
Despite the seemingly endless rounds of bus cuts, the Government seem reluctant to look at whether anything can be done in the round to improve the current system of bus funding. The Government’s argument is well rehearsed: the bus industry is a private industry and thus has nothing to do with central Government or central Government’s money. But that is just not the case. Around half of bus industry funding comes from the public purse. In 2014-15, total public support for buses accounted for 41% of overall industry funding. In the past, the figure has been higher; in 2010-11 it was more than 46%.
I do not think that asking the Government to publish their strategy regarding such funding for buses in a single document is really asking that much. We just want a little clarity in a system that has become convoluted and confusing. The strategy would set out the plan and objectives for the public money that goes towards local authority-supported bus services, the reimbursement of bus operators for trips made by concessionary pass-holders and the payment of the bus service operators grant to bus operators. Public money is being spent on buses, but the Government lack a strategy regarding how that money is spent. We believe that that needs to change.
I have previously raised the fact that operators are being reimbursed by public money for trips made by concessionary pass holders, but those operators can cut services and routes; the public have no say. That leads to the bizarre situation in which someone may have a concessionary bus pass, but no bus on which to use it. That is not a good deal for anybody.
We already have national strategies for roads and rail, and we are told that the cycling and walking investment strategy is imminent. Buses are being singled out within the transport family. Our new clause 1 would redress that imbalance and bring buses into line with other modes of transport.
We believe the Government need to do far more to help young people to afford the cost of bus travel. That is why we are asking the Government to include consideration of a young person’s concessionary fare scheme in the national bus strategy. Young people rightly have to stay in school, further education or training until they are 18, and many of them use the bus to get there. It is quite right that the Government should look at how they can reduce the financial burden on young people who are only trying to get to their school, job or apprenticeship.
Andy Burnham (Leigh) (Lab)
Young people in Greater Manchester have told me that it is sometimes cheaper for four of them to get a Uber than to travel on buses in Greater Manchester. How on earth can that possibly make sense, and how on earth can that lead to anything other than complete gridlock on our roads?
Daniel Zeichner
My right hon. Friend is absolutely right. On Second Reading, we heard a number of cases from across the country about the excessive costs of travelling locally, particularly for families. Such a cost is bad for congestion, it is certainly bad for employment and it is bad for social justice.
The way in which buses are funded in this country is clearly not working. We need a proper governmental strategy to address these funding issues and enable the country to have the national conversation about buses that is long overdue and much needed. I therefore urge the Government to accept our new clause 1. It may help the House if I suggest that we will press it to a Division.
Mrs Maria Miller (Basingstoke) (Con)
New clause 1 calls for a national strategy that sets out various targets and objectives. I feel sure that the Opposition spokesman, the hon. Member for Cambridge (Daniel Zeichner), sees one of the targets as the need to have accessibility for all who use the buses. I understand that the Government have already considered that issue after it was raised in Committee, and that they have very valid reasons for not going forward with a national strategy. However, by tabling the new clause, the hon. Gentleman has raised several important issues, and I want to mention some of them briefly.
In particular, there is a need for consistency. I welcome the change the Government have made with regards to information for bus passengers, which will help all our constituents. Some of my constituents have contacted me about the importance of having information available on the routes that they are taking. That is important not only for partially sighted or blind passengers, but for one constituent with autism and special needs who contacted me. This will help that individual, as well as a broader group.
As my noble Friend Baroness Campbell pointed out in the other place, other issues of national importance for people who use buses would fall within the national strategy proposed by the hon. Gentleman, such as wheelchair priority and access policies more generally. The Minister’s comments in Committee on wheelchair priority are very heartening. Following the Paulley case, it is important that an advisory committee will be set up. I hope that the Minister will confirm that he has given further thought to the composition of the group’s membership. Does he intend to involve the Equality and Human Rights Commission and the Disabled Persons Transport Advisory Committee? He should consider that carefully. The Minister did not touch on that detail in Committee—perhaps it had not been all worked through at that stage—but perhaps he could take this opportunity to assure the House that, subsequent to our debate in Committee, the discussions as part of that advisory group will be acted on quickly and that all relevant people will be involved.
Mrs Louise Ellman (Liverpool, Riverside) (Lab/Co-op)
Does the right hon. Lady agree that these measures in the national strategy would give bus services the status they deserve and recognise the fact that so many more people travel on buses, and make more bus journeys, than they do on trains, which are much more widely recognised in national policy making?
Mrs Miller
The hon. Lady makes an interesting point about the difference in the way trains and buses are treated. I do not necessarily agree that there is a need for the national strategy to ensure parity, but she makes an important point. There should not be undue differences in how we treat bus operators and train operators, in particular on disability issues. I will take that point one stage further before I finish.
When the Bill was discussed in the other place, my noble Friend Baroness Campbell said that there is a need for an accessibility policy with teeth to ensure that it is effective. As the hon. Lady said, there is a real contrast between how the Government treat buses and trains in respect of disability access and the conditions for licences for those who operate these important public services. It is a condition of a train operator’s licence that they comply with disabled people’s protections policy and state how they will protect the interests of disabled customers. That is enforceable by the regulator, with fines associated with lack of compliance. Why, therefore, is that not the case for bus operators? Perhaps in the absence of a national strategy, a condition could be put in place to ensure that such provisions exist for bus operators. Buses are an important way for disabled passengers to get to work and to social engagements, and to be a part of the community. Such provisions for bus operators would ensure parity between train operators and bus operators in how they support disabled people.
John Howell (Henley) (Con)
My right hon. Friend makes an interesting distinction between buses and trains. Surely the point is that there are policy initiatives the Government could take, for example on access for disabled people, but that does not mean that a national strategy will take away from the requirements of a local strategy, which is what the buses are based on.
Mrs Miller
I am not arguing against having local strategies, but a number of issues to do with the provision of services have a national resonance. The Government have identified this problem in the provisions on information that is available to bus passengers when they are on buses. That is nationally applicable. I am simply asking the Minister whether he will confirm what further thoughts he has given to ensuring that what is good enough for train operators is good enough for bus operators in respect of disability access.
Graham Stringer (Blackley and Broughton) (Lab)
I support the amendment and want to reflect the huge consensus in Committee on this issue. We divided on a number of matters, but it was a relaxed Committee and the Minister gave reasoned answers. The Bill represents a first step towards a change in attitude to buses. It was brought about following negotiations between the then Chancellor of the Exchequer and various metropolitan areas. A deal was reached whereby elected mayors could re-regulate bus services. I hope that this is just the first step.
I ask the Minister to reflect on this issue in a developing situation. The new Prime Minister has brought in an industrial strategy, and there is a strategy for the railways, as has been mentioned, as well as a strategy for aviation. It is rightly difficult to think of areas where large amounts of public money are spent where it is not the responsibility and the right of the Government and elected representatives to define the objectives that that public money should provide.
John Pugh (Southport) (LD)
The hon. Gentleman mentioned a connection between directly elected mayors and bus deregulation. Does he see any logical or sensible connection between the two? Is there any reason why the two should go hand in hand?
Graham Stringer
It was a pragmatic decision taken by the then Chancellor and the combined authorities in metropolitan areas. There is obviously no rational basis for deciding to have a different bus system in Greater Manchester from that in Southampton, for example. What would be the rationale for that? Clearly, there is none.
The point I was making is that, having taken the first step—not necessarily consistently, but in a sensible way in the metropolitan areas—it is right to look for a strategy that would help us to get rid of a relic of ideological Thatcherism from the early 1980s, which was seen in the Transport Act 1985 that deregulated buses. What the absence of strategy says is that we do not care how many millions of pounds have gone into the bus industry since 1986 when the 1985 Act came into force. I do not know, but I would have thought that over 31 years we are talking about a large chunk out of £100 billion being spent without any policy direction at all over that spending.
What we have been left with is a rather sterile debate. On the one side it is said that buses are declining and they would have declined in any case over this period. On the other side, there are those who think that that decline was not necessary. They say that without on-road competition, which has failed, with better competition at the tender stage and with a clearer decision on what bus services were needed and what fares should be charged, we would not have lost so many bus routes and bus passengers as we have. Not having a strategy over the last 31 years is saying that it does not matter that two thirds of bus passengers have disappeared in Greater Manchester and that bus fares have gone up considerably more than the rate of inflation. But these things do matter.
As both the right hon. Member for Basingstoke (Mrs Miller) and my hon. Friend the Member for Cambridge (Daniel Zeichner) have said, the vast majority of the people we represent, particularly the poorer people who do not have access to a car, rely on buses to get to work, to get to a hospital and to see relatives at weekends, but after deregulation, many of those bus routes no longer existed. How could we not have a strategy in view of that? How could we abandon those people?
Victoria Borwick (Kensington) (Con)
Following on from what the hon. Gentleman says about a strategy, it is important to ensure that we have better records on bus safety. I ask the Minister to look again at what record keeping we have on this issue. Of course we publish the number of people killed or seriously injured, known as the KSI, but many other injuries are caused by buses. I can speak only about the London experience, but it would be really helpful if, as we put into place our overall plans for transport, we think of some way of recording minor as well as major incidents, so that we can provide everyone with assurances about the safety of buses.
Graham Stringer
That is a pertinent point. However, a bus strategy would cover all the issues: personal safety, disabled access, fares, and where buses were running. It is clear from the interventions and the speeches that we have heard from Conservative Members, both today and in Committee, that that is where the central view of the House lies, and I think that that will be the direction of travel even if the new clause is not accepted on this occasion.
Mrs Ellman
My hon. Friend is making some important points. Does he recall that, over three Parliaments, the Transport Committee has investigated bus deregulation on five occasions, and does he agree that that reinforces the case that he is making for fundamental reform, starting with this Bill?
Graham Stringer
I do indeed recall the time and effort spent on the Committee’s reports with my hon. Friend. They show that competition does not take place on the road—that is a myth—and that we have left the public purse vulnerable to parasites like Brian Souter who have taken money out of it while putting up prices and reducing the service.
There will be a rearguard resistance from people who have benefited from the system, but we, as parliamentarians who have a duty to look after raised taxes, should support the consensus in favour of a bus strategy that I believe exists in the House. After all, there are strategies throughout the rest of our transport system.
Huw Merriman (Bexhill and Battle) (Con)
Like the hon. Member for Blackley and Broughton (Graham Stringer), I was a member of the Bill Committee, and was pleased to contribute to what was, as the hon. Gentleman said, a consensual discussion. It was very well piloted by the Minister, to whom I was grateful for sending a Double Decker chocolate bar through the internal mail. Sadly, owing to the internal mail system, it looked more like a bendy bus by the time it was opened, but I was grateful none the less.
There is much in new clause 1 that is attractive, but I think that, given the improved local data requirements in the Bill, it should be perfectly possible to fix the strategy on a local basis rather than needing some form of Government top-down approach. The essential aim of the Bill is surely to bring about more localism.
Andy Burnham
The right hon. Member for Basingstoke (Mrs Miller) made the important point that a national strategy, or consistency, would really help disabled people, who may travel to a different part of the country and not know what to expect from the public transport system. Can the hon. Gentleman not see that basic minimum standards for disability access or ticketing, for instance, would be very helpful to those who travel across the country using different public transport systems?
Huw Merriman
I can certainly see the attraction of that, but I also think there is a danger that if local authorities think that Government will deliver the strategy, they might then not put anything in place themselves.
Another mechanism in the Bill will make it easier for local authorities to get more involved in the actual policy of how the Bill is implemented and how partnership should operate. Rather than talking of a national strategy, I would state that the Bill has some excellent points that should assist strategy at a local level.
Huw Merriman
Of course: I will give way one last time and then move on to 16 to 19.
Mrs Miller
I understand the point my hon. Friend is making and have a huge amount of sympathy with his wanting to make sure that we have a local approach to our bus services. Does he not then agree with me that we need to make sure that our law, through the Equality Act 2010, has more teeth, so that individuals are able to make the law work for them when they encounter problems, such as discrimination against them because they are disabled?
Huw Merriman
My right hon. Friend is correct. Indeed, I had been going to retort that perhaps our laws need to be tightened up so that there is that combination. I absolutely agree with my right hon. Friend’s point, therefore.
Moving on to subsection (2)—
Madam Deputy Speaker (Natascha Engel)
Order. I remind the hon. Gentleman that we are discussing only new clauses 1, 2 and 3 in this group. The amendments that I think he wants to speak to—amendments 16 and onwards—are in the next group. If he wishes to speak to them, he can do so when the next group comes up.
Huw Merriman
I thank you for your guidance, Madam Deputy Speaker, but I was referring to subsection (2) of proposed new clause 1, which talks about the reduced fare concessionary scheme for 16 to 19-year-olds. Am I within order?
Huw Merriman
Thank you. I have no desire to talk on other proposed measures.
On new clause 1, I agree with the hon. Member for Cambridge (Daniel Zeichner), and see the advantages of this scheme. I serve a rural constituency where it is incredibly difficult for young people in particular to travel by bus. I would also extend his point: in my view, this relates to our desire to increase social mobility. If our young people cannot access work, perhaps at weekends, because it is too far for them to travel, and they cannot afford motor insurance premiums—which we all know, and have debated, are incredibly expensive—then there is something to be said for the argument about lack of social mobility. I am therefore attracted to the idea that this should be looked at.
We on the Conservative Benches would point out that we need to make sure that we cost those measures up, however, and that is the matter that would give me concern. If we increase the national debt through policies such as this one, that will have a negative impact on young people, because it is they and future generations that will have to repay it.
Perhaps we could consider the overall cost of concessionary travel, and whether it is time for concessionary travel, perhaps for the over-65s, to be given only to those who cannot afford it. We would therefore be looking more at means testing than giving concessionary travel to those who can well afford it and perhaps would therefore like to share that benefit with 16 to 19-year-olds, who, after all, we are requiring to stay in education and training and so need some assistance.
Andy Burnham
Does the hon. Gentleman accept that it may not be necessary to throw money at this? The powers in this Bill could be used cleverly to extract value. For instance, if longer-term franchises were given to the bus operators on condition that they could give free travel to 16 to 18-year-olds, they might then become more regular bus users in their 20s, in which case the bus operators would capture the upside of that. Does the hon. Gentleman therefore accept that this could be done cleverly if more areas were given the ability to use these powers?
Huw Merriman
The right hon. Gentleman is absolutely right. Anything that can be done to get young people on to the buses so that they stay on the buses has much to recommend it. I am also conscious that subsection (2) of new clause 1 refers to “consideration” of a reduced fare scheme, as, indeed, do the points I am talking to. So perhaps a mission for Government should be that money that can be saved, or perhaps reinvested, could go towards this measure, which I believe would help young people and social mobility.
John Pugh
I rise to speak in support of new clauses 2 and 3 in my name and also new clause 1.
Both my new clauses are basically about coherence; neither is about dictating to local authorities, as was mischievously suggested by the Secretary of State on Second Reading. I am not trying to dictate to local authorities what they should do. Both of them are also obviously about concessionary travel for young people, which has been a thorny issue throughout the passage of this Bill.
Support for young people’s transport is variable, as the hon. Member for Bexhill and Battle (Huw Merriman) said, and worsening. Since 2008, 50,000 16 to 18-year-olds have had free transport withdrawn—a 42% drop, I believe. Two thirds of local authorities no longer provide free transport to 16 to 18-year-olds, and the price of bus passes for 16 to 18-year-olds varies incredibly across the country, ranging from £230 to more than £1,000. The number of transport authorities offering concessions right across their area has dropped since 2010 from 29 to 16, and 10 authorities have no arrangements that benefit the older age groups. The roll of shame of authorities that do not offer any concessionary fares for young people comprises Cheshire West and Chester, Halton, Warrington, Lincolnshire, Nottingham, Peterborough, Bracknell Forest, Oxfordshire, Portsmouth and Slough.
The situation is hardly good and the impacts are fairly obvious. The hon. Gentleman mentioned the impact on educational progress. According to the Association of Colleges, a fifth of students consider dropping out during their course, and often the reason is transport costs or, if the cost is not foremost in their mind, transport difficulties. There is an impact on students: a survey by the National Union of Students shows that two thirds of further education students pay more than £30 a week for transport—a lot of money for a young person. There is a clear impact on traffic congestion and pollution—the hon. Gentleman mentioned that, too—as more young people get a car, perhaps sooner than they should, or rely on parental transport, which affects congestion at all the wrong times in most towns. There is also an impact on educational choice—I emphasise the hon. Gentleman’s point that the worst affected are probably residents of rural areas and poorer students generally.
Within the system are clear anomalies that need to be resolved. We raised the age of compulsory education, but local authority transport obligations remain very much as they were.
Andy Burnham
I agree with everything the hon. Gentleman says about the withdrawal of concessionary support for young people, but does he concede that the withdrawal of the education maintenance allowance under the coalition Government made the problems for young people much worse?
John Pugh
The right hon. Gentleman might be surprised to learn that EMA was mentioned in my notes, but for some reason I omitted to mention it just then. He has drawn attention to it, and I dare say it was a factor.
Another anomaly in the system—this is where new clause 2 comes into its own—is that while we all accord parity of esteem as between the academic route and the technical route, and the apprenticeship route is now being sold fervently by almost all Government Members, apprentices do not really get a look in: an apprentice aged 16 to 18 gets a bare £4 minimum wage. We want to make the apprenticeship route more attractive, and there is some evidence that where schemes are introduced, they are highly successful. Anecdotal evidence suggests that the MyTicket scheme in Liverpool city region improved attendance quite appreciably. Developing transport in line with the apprenticeship system is very much a part of the city region agenda, which the hon. Member for Blackley and Broughton (Graham Stringer) touched.
The aim of my new clauses is relatively modest. They would not change the character of the Bill, which I broadly support. Essentially, they oblige local authorities to take a broader view of the environmental and educational impacts of transport policy.
Lilian Greenwood (Nottingham South) (Lab)
Does the hon. Gentleman share my concern that while the Government make huge cuts to local authority funding, even where authorities want to provide concessionary fares they are in many cases being forced to withdraw them? We heard evidence to that effect from Nexus, which said that, as much as it would like to support young people, the point was being reached in the north-east where it would no longer be able to do so.
John Pugh
Desperate times call for desperate remedies, and the financial situation in most local authorities at this moment is desperate, as is evident from the Audit Commission’s recent study of local authorities’ financial sustainability. Whether the Government accept that point or not, I think they will accept that there is a case for joined-up policy. The Government need to link the apprenticeship opportunity agenda with real-time transport problems and impacts. That is where new clause 2 comes into its own, and if I am supported, I will happily press it to a vote unless the Minister can assure me that all these things are within his frame of reference for the moment.
The Parliamentary Under-Secretary of State for Transport (Andrew Jones)
It will be useful for me to cover all the amendments in one, hopefully fairly detailed, set of replies.
New clause 1 would require the Secretary of State to develop and publish a national bus strategy—which we discussed at some length in Committee, where I am glad the discussions were considered, reasonable and helpful—and to consider a reduced fare concessionary scheme for young people aged 16 to 19 as part of the strategy. New clause 2 would require the Secretary of State to publish a report setting out the possible steps to support local transport authorities to provide concessionary bus travel to apprentices aged 16 to 18.
While the Government fully appreciate the importance of public transport for young people, particularly those living in more isolated areas, we also recognise that the cost of transport can be an issue for some young people, including those who are participating in apprenticeships. One reason for the introduction of the 16-to-19 bursary fund was to help with transport costs. Funding is allocated to schools and colleges and is used to support disadvantaged young people who need the most help with education and training costs, and the 2015 evaluation showed that nearly 400,000 young people were being supported. However, the statutory responsibility for transport to education and training for 16 to 19-year-olds rests with local authorities, enabling them to make decisions that best match local needs and circumstances. Many authorities and operators already offer discounts for passengers in that age group.
Both issues relate to funding. In Committee, I made it clear that the Bill is not about funding; it is about providing authorities with new tools to help them improve local services in a way that best suits their areas. As part of the 2015 spending review, my Department is protecting the bus service operators grant at current funding levels until 2020-21, already providing significant certainty of funding for bus services without the strategy proposed by the hon. Member for Cambridge (Daniel Zeichner). The funding is provided directly to local authorities and to bus operators and is not broken down into categories of service or by route. Attempting to do so would be a burdensome exercise that could risk embroiling central Government in the fine detail of local bus service provision.
At the heart of the question about a national strategy is the fact that the Bill relates to local bus services. It is not about a top-down, national plan. Buses are local by definition and play a key role in local transport planning. That is why we are seeking to support local councils with more powers. A national plan is not the answer. More powers for local authorities are part of the answer, and they are what the Bill provides.
Graham Stringer
One of our few disagreements in Committee was about what should be determined locally and what should be determined nationally. When the Government are spending billions a year on bus services, does the Minister not think that they should take an interest in there being more bus passengers and more bus miles and in what the fares should be? That could be stated as part of a strategy. In that respect, what is the fundamental difference between buses and trains?
Andrew Jones
I am happy to agree entirely that buses are a critical part of any local transport mix. I am a great champion of bus travel, which has been made clear in all my work as a Minister and in Committee. However, this is about a local issue, not a national solution. I made a joke in Committee that one of the great truths of business is, “I’m from head office, and I’m here to help.” I often was that person from head office, and I was not always quite so welcome.
This should be about local transport needs, not about a national top-down strategy. Are the Government neutral? Of course we are not, which is why we introduced the Bus Services Bill and protected the bus service operators grant, but ultimately this is about local authorities working in partnership with local bus operators to deliver the right services for their area.
Graham Stringer
The Minister is being typically generous in giving way. If it is about local decisions, why will he not devolve the bus service operators grant to local authorities or elected mayors?
Andrew Jones
Some of the grant is already devolved to bus operators, but the key reason not to devolve it further is that it goes direct to bus operators, which very frequently operate routes that cross council boundaries. Council boundaries and bus routes are not the same thing. Transport to work has nothing to do with a local authority’s geography, so it would potentially be a bureaucratic nightmare to change the system.
Having said that, we are considering how to reform the BSOG operation. The grant pays a flat 34.57p a litre in subsidy, which is why it used to be called the fuel duty rebate. We are considering how to incentivise better practice, rather than just rewarding bus operators for using fuel, which is not good practice.
Lilian Greenwood
It feels as if the Minister is trying to devolve all responsibility for the state of our bus services. It was announced in the 2015 local government settlement that core central Government funding to local authorities would fall by 24% in real terms, which is partly why local authority support for buses is falling. Does he not take any responsibility for the impact that is having on bus services and on people’s ability to use the buses?
Andrew Jones
Of course I recognise that the pressures on local government finance are quite acute. In fact, I was in charge of my local council’s financial affairs throughout the financial crash in 2008-09, so I am fully aware of that. At the same time, it does not change the requirement to recognise that buses are a local service and should be determined locally.
Andy Burnham
Has my hon. Friend the Member for Blackley and Broughton (Graham Stringer) not just exposed a major contradiction at the heart of the Government’s position? The Minister says that he wants local delivery but, when it comes to cross-border issues, he says that Whitehall knows best. Surely the Government’s position on bus services should be for maximum devolution, including of the budget.
Andrew Jones
I am not saying that Whitehall knows best; I am saying that the grant is best delivered to bus operators that are running cross-border services, and then to take it from there. It is not a question of Whitehall knows best. We are not determining the routes that operators should be operating. We are keen to see more support for buses and more routes available, but the way to achieve long-term sustainable bus growth is to have more passengers on the buses.
My right hon. Friend the Member for Basingstoke (Mrs Miller) mentioned the Paulley case, which took five years to go through our legal system and reached the High Court. Specifically, we will be inviting the Equality and Human Rights Commission to attend the meetings of our working group, on which progress has been made. We seek to have a small working group that will look at the practical implications of the Paulley case. Among the members invited so far is the Disabled Persons Transport Advisory Committee, because we want the voice of disabled groups. We also want the voice of the bus operators, so we have invited the Confederation of Passenger Transport and the Association of Local Bus Company Managers. We also want the voice of passengers, so Transport Focus has been invited. I hope we will see the Equality and Human Rights Commission, which has been invited to attend but not as a formal member. I hope to get things under way with our first meeting next month.
Ian Mearns (Gateshead) (Lab)
I apologise to the Minister, but may I take him back to the cross-border issue? Even in areas that do not have a landscape drawn out for elected mayors, local authorities have for the past three decades worked in partnership with one another where bus routes go across their local authority boundaries. I do not understand his point about devolving the grant to the bus company and not to groups of local authorities in travel-to-work areas.
Andrew Jones
The devolution of the funding goes straight to local bus companies. We are looking at how we can reform BSOG and I will take the hon. Gentleman’s points as a contributory suggestion. I do not want to change the system unless we are clear that it will keep more routes operational. We would have no guarantee, unless we ring-fenced the funding, that if we granted the devolution of BSOG to a local authority it would be used to support buses. It could go towards other forms of local transport. I want to keep it focused on buses. That is why it is with operators. However, I will take his point on board as we think about how to take this matter forward.
To answer my right hon. Friend the Member for Basingstoke a little more fully, the working group needs to be very action-oriented. The High Court encountered practical challenges in dealing with the issue of disabled access. We need to get the balance right. The space that is used for wheelchairs may also be used for parents with disabled children, the owners of assistance dogs and people who use walking frames. I want to protect everyone’s needs.
Disabled transport plans such as DPPPs are important in providing confidence and consistency for disabled people when using transport. I have much sympathy with the reason underlying my right hon. Friend’s suggestion. We will take forward a recommendation in the guidance supporting the Bill that authorities ensure that information is made available to passengers. That might be in a form that is provided by the authority or by individual operators. Again, we have been working on this issue with DPTAC, which has developed a template. I am keen to publish that with the guidance and encourage bus companies to use it. I therefore expect us to make progress in this area, which I hope will assist my right hon. Friend.
Mrs Miller
I welcome the Minister’s clarification with regard to the guidance being made available to passengers, but I gently remind him that when it comes to rail passengers, not only is there a regulator breathing down the neck of providers, but there are fines for non-compliance. How can he give this real teeth?
Andrew Jones
My right hon. Friend makes an interesting point, but I am not sure that there is a straightforward read-across from rail to buses. There are 30 or so rail companies in this country and 1,000-plus bus companies. We need to have something that is proportionate. For the very largest groups, what she suggests might be appropriate. For the smallest companies, which might be operating a single route, what we are suggesting would clearly be more appropriate to provide information to disabled passengers, which is ultimately our joint objective.
New clause 3, which was tabled by the hon. Member for Southport (John Pugh), would require local authorities that do not provide a concessionary scheme for 16 to 18-year-olds in full-time education to produce a report, setting out the impact on that group of young people and on local traffic of not providing such a scheme. As I have said, the legal responsibility for transport to education and training for 16 to 19-year-olds rests with local authorities, which are free to put in place appropriate arrangements. Those arrangements do not have to be free, but we expect local authorities to make reasonable decisions based on the needs of their population, the local transport infrastructure and the available resources.
Local authorities already have a duty under the Education Act 1996 to publish a transport policy statement each year, specifying the travel arrangements they will make to support young people to access further education and training. New clause 3 would simply replicate that duty.
In short, I do not believe that new clauses 1, 2 and 3 would add anything of value to the delivery of a bus service on a local basis or directly benefit passengers. I therefore hope that hon. Members will not press them.
Daniel Zeichner
Once again, we have had a constructive exchange; the points made about disabled access are welcome and will be pursued. As in Committee, much of the discussion has hinged on issues of localism. My hon. Friend the Member for Blackley and Broughton (Graham Stringer) and my right hon. Friend the Member for Leigh (Andy Burnham) described well what we and many others see as the failures of the systems over the past 30 years. We discussed at length in Committee the value of a national framework, and I did not hear a huge amount of opposition to that in the contributions from Government Members, with many seeming to suggest that they, too, could see the benefits. The Minister heroically stuck to the script and clearly does not wish to go down that route just at the moment, but as we consider in future the way we fund bus services, be it the concessionary fares schemes or the bus service operators grant, there will clearly be a debate to be had.
Lilian Greenwood
Does my hon. Friend agree that it would be helpful to have that national discussion, involving not only passengers but the industry and the local authorities, about the most sustainable way to fund buses? As local authorities develop different emissions standards as part of their own partnership and franchising schemes—the Campaign for Better Transport has said this—would a national strategy not provide some certainty for the UK’s bus vehicle manufacturers as well? There are many advantages to doing this, are there not?
Daniel Zeichner
As always, my hon. Friend is absolutely right. She has raised the important issue of air quality, which is clearly becoming more important in many of our cities across the country. I just suggest to the Government that having a national framework within which to discuss these things might be extremely helpful, for a whole range of reasons. I fear that we are not going resolve or agree on this issue, so we will press new clause 1 to a Division.
Question put, That the clause be read a Second time.
Madam Deputy Speaker (Natascha Engel)
With this it will be convenient to discuss amendment 14, in clause 4, page 14, line 13, at end insert—
“(2A) A franchising scheme may not be made unless the franchising authority can demonstrate that the benefits for passengers could not be provided by a quality partnership scheme, an advanced quality partnership scheme or an enhanced partnership scheme.”
This amendment would ensure that a Local Transport Authority cannot make a franchise scheme if the passenger benefits can be provided by a quality partnership scheme, an advanced quality partnership scheme or an enhanced partnership scheme.
Amendment 16, page 15, leave out line 36 and insert—
“(3) A franchising authority or authorities shall consider an assessment and shall not proceed with the proposed scheme unless it is satisfied that—”
This amendment and amendments 17 to 23 would tighten the criteria against which an authority must consider a franchise proposal.
Amendment 17, page 15, line 37, leave out “whether”.
This amendment is consequential on amendment 16.
Amendment 18, page 15, line 43, leave out “whether”.
This amendment is consequential on amendment 16.
Amendment 19, page 16, line 1, at beginning insert “they know”.
This amendment is consequential on amendment 16.
Amendment 20, page 16, line 3, leave out “whether”.
This amendment is consequential on amendment 16.
Amendment 21, page 16, line 5, leave out “whether”.
This amendment is consequential on amendment 16.
Amendment 22, page 16, line 7, leave out “the extent to which”.
This amendment is consequential on amendment 16.
Amendment 23, page 16, line 7, leave out “are likely to” and insert “will”.
This amendment is related to amendment 16.
Amendment 15, page 16, line 9, at end insert—
“(g) the specific passenger benefits that would result from a franchise scheme, with an explanation of why those benefits could not be delivered by a quality partnership scheme, an advanced quality partnership scheme or an enhanced partnership scheme.”
This amendment would require a franchise assessment to specify the benefits of the proposed scheme for passengers and to explain why these benefits cannot be delivered by a quality partnership scheme, an advanced quality partnership scheme, or an enhanced partnership scheme.
Amendment 24, page 16, line 9, at end insert—
“(g) whether the proposed scheme would be more efficient, effective and economic than any other option, taking into account any compensation payable to bus operators whose businesses would be wholly or partially expropriated by the scheme.”
This amendment would ensure that the value for money test of a franchise scheme must factor in the cost of compensation to bus operators who lose part or all of their business as a result of a franchise.
Government amendments 2 to 4.
Amendment 25, page 17, line 7, at end insert—
“(3A) A person may not act as an auditor under this section if the person or company for whom the person is employed has been an auditor for the franchising authority at any time in the previous five years or has had any other commercial relationship with the franchising authority at any time in the previous five years.”
This amendment would ensure that any auditor appointed by the franchising authority had no commercial interest or association with the franchising authority which might create, or might be perceived to create, a conflict of interest.
Government amendment 5.
Amendment 6, page 19, line 37, at end insert—
“(4A) An award of any new franchise or contract shall not be made on the basis of labour costs estimated by the potential franchisee or contractor assuming labour costs for new employees at less than the labour cost of workers who are covered by TUPE protections in accordance with section 123X transferring to the new franchisee or contractor.”
This amendment would ensure that any new franchise or contract will not be awarded on the basis of estimated labour costs being lower for new employees than the labour cost of workers covered by TUPE protections.
Amendment 26, page 20, line 24, after “(or further postponed)” insert “or cancelled”.
Amendment 27, page 20, line 24, at end insert—
‘(1A) If an authority or authorities decide to cancel a proposed franchising scheme under subsection (1) they may not initiate a revised or alternative franchising scheme until the end of the period of five years beginning with the date on which the decision to postpone the original scheme was taken.”
This amendment would provide greater certainty for bus operators and passengers by specifying that, if a franchising authority fails to make a case for a franchise scheme or decides not to progress its proposals, it should not be permitted to bring forward fresh proposals for five years.
Amendment 7, page 30, line 2, leave out “at the same time,”.
Amendment 8, page 30, line 14, leave out “at the same time”.
Amendment 9, page 32, line 27, at end insert—
“123Y Employees not covered by TUPE protections
Employees of local bus service providers who are not covered by TUPE protections may not be employed on terms and conditions less favourable than those provided by TUPE.”
This amendment would ensure that employees working under local service contracts not covered by TUPE protections may not be employed on terms and conditions less favourable than those provided by TUPE.
Amendment 10, page 32, line 27, at end insert—
“123Z Effect on employees of introduction of local service contract
(1) Where, either before or after the introduction of a local service contract following an assessment under section 123B, any employee of an operator in the area to which the scheme relates is dismissed, that employee is to be treated for the purposes of Part 10 of the Employment Rights Act 1996 as unfairly dismissed if the sole or principal reason for the dismissal is the introduction of the relevant local service contract.
(2) Paragraph (1) applies whether or not the employee in question was part of an organised grouping of employees principally connected with the provision of local services, under section 123X(4).
(3) Where section 123X(4) applies, a new operator may not engage employees or workers on terms and conditions less favourable than those of the employees whose employment transferred from the former operator.”
This amendment would make dismissal of an employee for the sole or principal reason of the introduction of a franchising scheme automatically unfair dismissal.
Amendment 28, in clause 9, page 41, line 17, at end insert—
“(6A) The requirements that may be specified under subsections (4)(b), (4)(e) and (4)(h) in relation to fares and the prices of multi-operator tickets may only be specified if all operators party to the enhanced partnership scheme are in agreement with those requirements.”
This amendment would specify that fares structures could only be specified as part of an enhanced partnership scheme if the operators involved agree.
Amendment 11, page 57, line 3, leave out “at the same time,”.
Amendment 12, page 57, line 14, leave out “at the same time,”.
Amendment 13, page 59, line 42, at end insert—
“138T Effect on employees of introduction of enhanced partnership scheme or plan
(1) Where, either before or after the coming into force of an awarded contract in an area to which the relevant enhanced partnership scheme relates, any employee of an operator in the area to which the contract relates is dismissed, that employee is to be treated for the purposes of Part 10 of the Employment Rights Act 1996 as unfairly dismissed if the sole or principal reason for the dismissal is the introduction of the awarded contract.
(2) Paragraph (1) applies whether or not the employee in question was part of an organised grouping of employees principally connected with the provision of local services, under section 138S(4).
(3) Where section 138S applies, a new operator may not engage employees or workers on terms and conditions less favourable than those of the employees whose employment transferred from the former operator.”
This amendment would make dismissal of an employee for the sole or principal reason of the award of a contract under an enhanced partnership scheme automatically unfair dismissal.
Ian Mearns
I declare an interest inasmuch as I am chair of the RMT parliamentary group and vice-chair of the Unite parliamentary group, both of which unions have members in the bus industry.
The transport sector is a safety-critical environment. This is not a loose use of language. The sector involves carriages travelling at speed, individuals working long hours on repetitive tasks on repetitive routes, and people maintaining equipment at all hours of night and day. Hard lessons have been learned following a series of fatal road and rail crashes in the 1980s and 1990s. However, continuing financial pressures, declining support from Government through the bus service operators grant, and commercially oriented initiatives towards potentially reducing staff could threaten safe working practices.
Bus drivers are aware of where corners are being cut. In theory, they may be empowered to use their employers’ whistleblowing policies to speak out. In practice, however, workers who do so are frequently subject to all sorts of pressure and have been known to be dismissed for whistleblowing. This invariably leads to serious safety failings being increasingly ignored and not adequately investigated, or the results of an investigation not being acted on by bus companies.
To counter the dysfunction, a confidential reporting service known as CIRAS was introduced. This system, initially only for rail, has been successful in enabling workers properly to ventilate their concerns, resulting in lessons being learned and an accumulation of failings being halted, with serious harm prevented. All the major rail companies, many of which also own bus companies, such as FirstGroup, Go-Ahead Group and Stagecoach, have signed up to CIRAS.
I should declare another interest inasmuch as I am a frequent user of my local bus services in Gateshead, as I do not own a car. A very good bus service is provided by Go-Ahead Group in my locality, but unfortunately not all my constituents can benefit from such great services. The bus company tries its best and provides excellent bus services during the peak hours, but as the evening goes on, unfortunately, their frequency dwindles.
Bus workers outside London should also be able to access CIRAS. That would be the effect of the new clause, which would reproduce CIRAS in franchises or quality partnerships. In response to a spate of deaths and serious injuries involving buses on London’s roads, Transport for London successfully extended the CIRAS scheme to London buses. London has one of the best resourced bus networks and some of the newest buses anywhere in the country. CIRAS itself supports the extension of the scheme to bus operators nationwide. In line with other aspects of the Bill—including matters unconnected to franchising and partnerships, such as audio and visual announcements—a nationally mandated approach is warranted and would be greatly desirable.
Sir Henry Bellingham (North West Norfolk) (Con)
I rise to support amendments 14, 16 to 23, 15 and 24 to 28, which are in my name and those of my right hon. and hon. Friends. Amendment 14, which is very straightforward, would ensure that a local transport authority could not make a franchise scheme if passenger benefits can be provided by a quality partnership scheme, an advanced quality partnership scheme or an enhanced partnership scheme.
Amendments 16 to 23 are mainly drafting amendments, but it is important that a franchising authority should be satisfied, rather than that it should just have considered the issues in a franchising assessment. As we heard in the debates on clause 4, it is clear that franchising should not be an easy option. A local transport authority should not be allowed to take a simple punt at franchising without having given full and detailed consideration to all the other options available. There will of course be other options, not least the partnership arrangements that we have looked at, and to which we will surely return in the near future.
The Bill contains stringent tests, but I think it would be very easy for a local authority to say that it has considered whether a proposed franchise regime would contribute to its transport policies; whether it has the capability and resources to operate the scheme; or, just as importantly, whether it can afford the scheme and that it represents value for money for local taxpayers—in other words, our constituents. It is quite another thing, however, for the authority to say that it is satisfied that its proposals will do these things. Surely, given the importance of the step the local authority is proposing to take in implementing a franchise scheme, it is not too much to ask whether it is convinced that its proposals will do exactly what they intend. That is what my group of amendments sets out to achieve.
Amendment 15 simply complements amendment 14, although it looks at the issue from a slightly different angle. I will not say anything more about amendment 15, except that we cannot really have amendment 14 without amendment 15. Amendment 15 requires a franchise assessment to specify the benefits of a proposed scheme for passengers and to explain why those benefits can be delivered by a quality partnership scheme, an advanced quality partnership or an enhanced partnership scheme.
Amendment 24, probably the most important amendment in this group, is all about compensation. The key is to bring into play a degree of fairness. The Bill is silent on the matter of compensation and I think that is wrong. I know what the Minister will say in his response. He will probably say that he will go along with the Transport Committee when it said in its recent report that there is no case for compensating operators who lose their business. I am fully aware that compensation would not have been available under a quality contract scheme, but the days of quality contracts are severely numbered. The fact that there was no compensation under that scheme does not mean to say that it is not right to have compensation for the new arrangements. The loss of business would be bad enough for the large plcs, which would have to redeploy their staff and their assets, but what about the smaller operators?
Graham Stringer
I am listening carefully to the hon. Gentleman. Will he explain—so far, he has not done so—on what basis compensation would be given when every bus company is able to compete to run buses via a franchising process?
Sir Henry Bellingham
I am not an expert on this, but the small and medium-sized bus companies in my constituency tell me that they are very concerned indeed. They have established their businesses on the back of a lot of hard work, and they have taken a lot of risks. One company that came to see me said that its directors had re-mortgaged their homes and invested their life savings to ensure that the company grew. They stand to lose—not because they have not performed properly, not because they are a bad company, and not because the passengers have decided that they no longer want to use those services—if they do not win a bid to continue to do what they have been doing successfully for many years. I suggest to the hon. Gentleman that this is a fair measure and I ask the Minister to consider it.
The wider point is this: what message does it send to businesses looking to invest in the UK? We want businesses to come to the UK to invest. We should be saying to them, “You’ve come to the UK to invest, and if local authorities take your business off you there will at least be some compensation.” This measure will, in the longer term, represent good value for the taxpayer, because it shows that taxpayers’ money will be put to a good use. If businesses are put out of business because of measures in the Bill, then surely there should be some recourse to compensation.
Bridget Phillipson (Houghton and Sunderland South) (Lab)
The hon. Gentleman rightly talks about the importance of delivering value for money for the taxpayer. In the north-east, as in many parts of the country, there is not good value for the taxpayer. The Competition Commission has shown that a very limited number of bus operators have a monopoly over our services. The competition that was meant to follow deregulation has not materialised. This is not good value for the taxpayer. The Bill would allow smaller operators to break into a market on which the big boys currently have a stranglehold.
Sir Henry Bellingham
The hon. Lady makes a fair point. I can judge only on the basis of what is going on in my area, but I hope that the Minister will take into account what she said. I want more competition and more small operators. There are a lot of big operators around; I want to see the small ones flourishing. It is certainly the case in Norfolk that the small operators, companies such as Norfolk Green, were able to move in on routes and bring a new culture and new service ethic into place—it has done a fantastic job. I defer to the right hon. Member for Leigh (Andy Burnham), who knows a lot about this subject, but these operators have been able to get more customers on to routes and even to re-open routes that had previously been closed down.
Andy Burnham
The trouble with what the hon. Gentleman is saying is that it has not worked that way under the current regime; passenger numbers have gone down in Greater Manchester. My worry is that he seems to be speaking for the bus companies rather than for the travelling public—that is what it sounds like to me. Can he assure me that this is not a wrecking amendment? Is he hoping that the fear of paying compensation will persuade local authorities not even to try to use these powers because they cannot afford to pay that compensation? Is that what he is trying to do?
Sir Henry Bellingham
I can assure the right hon. Gentleman that I am not trying to wreck the Bill in any way or do anything that is untoward. I am simply trying to make sure that SMEs are treated fairly.
Let me move on quickly to amendment 25. It is a simple amendment that is designed to ensure that any auditor appointed by the franchising authority has no commercial interest in or association with the franchising authority that might create or could be perceived to create—perception is very important as well—a conflict of interest. I very much hope that the Minister will accept this amendment. It is reasonably anodyne, but quite important. I urge him to look at it very carefully indeed.
Amendments 26 and 27 are quite small amendments, too, but they are important. If a franchising authority fails to make a case for a franchise scheme or decides not to progress its proposals, should it be permitted to come back to that scheme the following year, the year after that or indeed within months? I suggest that it should not. These amendments to clause 4 would prevent the authority from coming back with fresh proposals within five years.
In the autumn statement, my right hon. Friend the Chancellor said:
“I know how much business values certainty and stability”.—[Official Report, 23 November 2016; Vol. 617, c. 908.]
I think he was right. One thing that business dreads is uncertainty, which affects investment plans, recruitment decisions and the way that businesses, particularly SMEs, conduct their everyday activities. Bus operators are understandably and justifiably concerned that some of these measures could put their businesses under threat—in the worst-case scenario, with the franchise authority coming back to the franchise time and again within the five-year period. We want to create a situation in which there is a workable franchise scheme and the franchise authority cannot keep chipping away at it.
These amendments are not vital, they would also help local authorities. We know that the burdens on local authorities are growing the whole time. They are under massive pressure to deliver better services and better value for money, whether it be in respect of refuse collection, care for the elderly, street lighting, planning and so on, with ever-dwindling resources. The local authority might have a lot of pressure put on it by its elected members or other bodies to devote time and energy to bringing back a franchise exercise that was not progressed in the first place, which I think would be a mistake.
Andy Burnham
I would like clarification and reassurance from the hon. Gentleman. It sounds to me as if the combined effect of these amendments is to open up some confusion, to create possibilities for bus operators to use legal challenge, and to delay and tie the hands of the combined authority in the case of Greater Manchester and in other combined authorities elsewhere. Can he be absolutely clear that that is not what he is trying to do? It sounds to me for all the world as if that is the real intent behind these amendments.
Sir Henry Bellingham
I have a lot of time for the right hon. Gentleman. I remember asking him questions in past times, when he was a Minister and I was on the Opposition Benches, and we have engaged in debates in Committee. I assure him that I do not intend to do what he has suggested. I think that small and medium-sized enterprises and the smaller bus companies will support the amendments.
Lilian Greenwood
Will the hon. Gentleman not acknowledge that the very fact of having the opportunity to take franchising powers enables local authorities to put pressure on operators, not all of which are small and medium-sized companies—in fact, most of them are very large—in order to bring them into partnership arrangements? If a local authority does not have the potential to develop franchising schemes, many operators will not seriously enter into negotiations on either advanced quality or enhanced partnerships.
Sir Henry Bellingham
I was under the impression that authorities had those powers anyway, but the Minister will obviously have heard what the hon. Lady has said. It is up to the Minister to listen to what we have said, and then to make a decision.
I now want to say something about amendment 28. I will be brief, because I have already taken up a fair amount of the House’s time. The amendment would allow fares structures to be specified as part of an enhanced partnership scheme only if all the operators involved agreed. The key issue is the ability of commercial bus operators to set their own fares, which is an important feature of a deregulated market. Of course fares structures are set competitively. In the same way, a commercial enterprise looks at what its competitors are charging, and structures its own charges accordingly. The competition authorities have introduced important safeguards to ensure that bus companies do not collude to stitch up the market and set fares at levels that disadvantage passengers. There are checks and balances, and that is extremely important.
Ian Mearns
What the hon. Gentleman is saying seems to suggest that the powers of a local authority, or collection of local authorities, in the areas that he represents would be less than those currently enjoyed by the voters of London when it comes to oversight of the running of an integrated transport system. Why should electors in all the other parts of England have an inferior set of arrangements?
Sir Henry Bellingham
I simply say to the hon. Gentleman—for whom I have a huge amount of respect—that I have listened to bus operators and passengers in my constituency. We now have more bus services in our remote communities and villages that we did, say, 20 years ago, when the hon. Member for Cambridge (Daniel Zeichner) was standing for election to a rural Norfolk seat—and he nearly won that seat in 1997; I think it was Mid Norfolk—because SMEs have stepped up to the plate.
I have taken enough of the House’s time. Let me simply say this to the Minister. I believe that the amendments go a modest way towards improving the Bill, without undermining or sabotaging parts of it. I think that they will help bus operators—especially the smaller ones—and passengers and local authorities by providing clarity.
Mrs Ellman
I want to talk about the new clauses and amendments relating to franchising, including amendments 14 to 23, 26 and 27.
The strength of the Bill lies in devolution, and its proposal that decisions on how to provide local bus services should be devolved to local transport authorities, which should consider what works best in their areas. It is important to remember that the Bill has come about because of dissatisfaction among members of the public—people who want to use buses—with the way in which the current system operates. There have been a number of attempts to change the Transport Act 1985, which deregulated transport services, but none of those attempts —which have been made under successive Governments—has resolved the problem. The Bill is important because it tries to address the difficulties that the public have experienced, and to create a thriving bus sector.
The Transport Committee examined the Bill in detail from the perspective of passengers. We welcomed the possibility of new and smaller entrants to the bus market, but what worries me about the new clauses and amendments is they may prevent the proposed devolution from taking place. There are two aspects of that. The first relates to combined authority areas with directly elected mayors having the power to proceed with franchising. There is a lack of clarity about the regulations that will be introduced, or imposed, to impede the ability of the mayors to do that. Will it be an absolute right, or will onerous, complex and perhaps unknown regulation be imposed? I hope that the Minister will clarify that issue, because it relates to a fundamental part of the Bill.
Secondly, the Bill proposes that transport authorities in areas that are not run by combined authorities with directly elected mayors may have powers to introduce franchising in certain circumstances. The amendments make that proposal extremely complex. It would be impossible to assess whether the transport authorities would be able to proceed with franchising if they wished to do so. The Transport Committee looked at good practice, and concluded that transport authorities should consider existing ways of operating in partnership with operators before moving to a franchising system, but we did not think that that should be part of the regulations. This proposal introduces new hurdles, but it is not fully specified what those hurdles are, or—this is equally important—how they would be assessed before the authority could adopt the franchising system. That, I believe, strikes at the heart of the Bill.
The Bill is intended to improve transport services in localities and devolve to local transport authorities the ability to act on the needs of their areas, but the hurdles introduced by the amendments might enable future Ministers to impede its objectives, and I am sure that present-day Ministers would not wish that to happen. I am extremely concerned about the amendments. I hope that the Minister will tell us more about what they mean, and will make clear whether the Government intend franchising to go ahead, as they have stated, without introducing complex hurdles which would make the proposed system extremely difficult to achieve.
Graham Stringer
It is a pleasure to follow my hon. Friend the Member for Liverpool, Riverside (Mrs Ellman), who chairs the Transport Committee. As she said earlier, the Committee has considered this issue on a number of occasions, and—my hon. Friend the Member for Gateshead (Ian Mearns) mentioned this—we have never been able to find a reason why London should have one system and the rest of the country should have another. The hon. Member for Wimbledon (Stephen Hammond) grins at that, and I do not blame him, because the regulated system in London is superior to the system in the rest of the country.
I listened to the responses of the hon. Member for North West Norfolk (Sir Henry Bellingham) to my right hon. Friend the Member for Leigh (Andy Burnham) about his not wanting to wreck the Bill, and I take that at face value. However, I do not think the amendments reflect the reality of the nature of bus services, certainly in urban areas. I am not an expert on bus services in Norfolk and suspect the hon. Gentleman knows more than I do about Norfolk, but if he is concerned about small bus companies, he should support this Bill as it is or seek to improve it, because what has happened in the west midlands, Merseyside, Tyne and Wear, Greater Manchester and the great urban areas of this country is precisely the opposite of what he wants: small companies have been driven off the road by large companies.
Ian Mearns
I could not agree more with my hon. Friend about the impact on the small bus service providers. When bus services franchising was introduced, I remember visiting Merthyr Tydfil to see Gateshead football club play Merthyr in a Conference fixture, and—lo and behold—there in Merthyr Tydfil were Go-Ahead Gateshead buses being used in a local bus war to destabilise a local small bus company. So in terms of the impact on small and medium-sized bus companies, that particular horse bolted long ago.
Graham Stringer
My hon. Friend is right: the deregulation of bus services has not led to greater competition and has not benefited SME companies. They have been literally driven off the roads, because on the odd occasions when there has been on-the-road competition, it has led to congestion and eventually a large monopoly operator taking over. FirstGroup, Stagecoach, Arriva, Go-Ahead and one or two other companies have taken control and have therefore been able to exploit the situation through introducing high bus fares and sometimes withdrawing services for other areas.
Robert Jenrick (Newark) (Con)
I have listened with interest to the hon. Gentleman’s comments on small and medium-sized bus companies, and there is a lot of truth in what he says about the smallest bus companies, but does he agree that the greatest concern is for medium-sized operators? There are not many medium-sized companies in the country, but there are some in counties such as mine, Nottinghamshire, and neighbouring Derbyshire: Marshalls of Sutton on Trent and trentbarton —which the hon. Member for Nottingham South (Lilian Greenwood) will be familiar with—are good medium-sized bus companies and they stand to lose a lot from this. They will grow exponentially if they win a franchise or, in the case of either of those companies, they could find 30 years of hard work going down the toilet with no compensation whatsoever.
Graham Stringer
The hon. Gentleman makes a fair point, and I will come on to it. He is right to be concerned about that, but I want to develop the logic of the argument that I am making as to why these are not sensible amendments. In large parts of the country, where most bus passengers are, we do not have competition. The basis of the Transport Act 1985 was that there would be on-the-road competition and that would provide good services, and if bus companies lost out because of on-the-road competition, they lost out as in any other capitalist-competitive market situation. That has not happened, however; we have moved to monopoly.
Incidentally, when the 1985 Act was implemented in 1986 no compensation was paid to those bus companies—of which there were a number—running on regulated routes. Mayne in east Manchester, for instance, had run for many years in that area; when it had to compete, it did not get compensation.
We are now moving—through principled objectives, in a different way—to a competitive system, in those areas that choose that, because there will be choices for Norfolk, Greater Manchester and other areas at some stage. As with rail franchising, in a competitive situation, when a company loses out, it loses its business, even if it has invested in it previously. In fact, one of the difficulties with franchising is that we end up with investment up front and a lack of investment at the end; that is just the nature of franchising.
On the point made by the hon. Member for Newark (Robert Jenrick) about medium-sized bus companies, that can of course be taken into account in the way that franchises are set up, by local choice. Areas can set them up in as many different ways as they wish, so medium-sized companies could be given the right to tender for routes that fit the size of the company if that was what the franchising authority wanted to do.
That brings me to a point I made in Committee, and which was rejected. Rather than the amendments we have here, I would have preferred the Bill to say that the regulations should not be overly burdensome and that they should reflect local conditions. If they were reflecting local conditions, they could take into account those small and medium-sized companies. There is a large point here, however, and, as my right hon. Friend the Member for Leigh said, the large companies would be more pleased than the small bus companies if these amendments were passed.
There is not a single quality contract in this country, and that is because when they were brought in under the Transport Act 2000, it contained a clause that is very similar to measures here, saying that they are the only practical way of delivering a better bus service. That is an incredibly high hurdle to jump, which is why there are no such contracts. Quality partnerships were referred to; I asked the Minister in Committee how many of them there were in the country, and, after a little help from the officials, we discovered that there were 10. So even quality partnerships are not abundant on the ground in this country. We do not need overly burdensome regulations. We want to make this work because it will improve the service for passengers, be more competitive and lead to better services.
We are not discussing them now, but there are huge guidance notes associated with this Bill, which I think tend to be overly prescriptive. I prefer to rely on the good sense of local councillors; they will make some good decisions and some bad decisions, but there are many bus companies with vested interests who are opposed to this, and if local authorities behave in an unreasonable way, they have the right to apply the Wednesbury principle and go for judicial review.
Rather than having lots of prescriptions, and putting ever more hurdles in the way of locally elected people making decisions, we should rely on their good sense. Sometimes they will get it wrong, as sometimes national politicians in Governments and Cabinets get things wrong, but we can rely on them and the common law, which will ensure that if bus companies feel that they are being unfairly treated and that transport authorities are behaving in an unreasonable way, they can take that to court.
So I hope the Minister will reject these amendments. We have held in the balance throughout our discussions the question of what is central and what is going to help local authorities, transport authorities and elected mayors to make these decisions, and these amendments do not help move us towards having a better local transport system.
Daniel Zeichner
There is a wide range of amendments in this group, many of which we support, but some we do not.
I genuinely hope that the Minister will consider new clause 4 on bus safety, despite his comments in Committee. More disappointment has been expressed to me on that aspect of our Committee discussions than on any other, partly because the comments of the Minister in the other place had been encouraging, but also because I cannot believe that there is any disagreement on the value of improving bus safety, and this is widely seen as an effective and cost-effective way of achieving that goal.
I think the Minister suggested in Committee that he might be minded to insert some guidance to encourage bus operators to sign up, but the evidence on voluntarism is clear: to my knowledge, no bus operator outside the London franchises is signed up to any independent, confidential incident reporting system. We have an opportunity now to end that situation. As my hon. Friend the Member for Gateshead (Ian Mearns) said, such a system is not expensive. It works in the railway industry, and I have not heard a strong case made against it. It seems to work well and I urge the Minister to grasp the opportunity.
Amendments 14, 16 to 23 and 15 appear to us to be unnecessary and to go against the spirit and devolutionary nature of the Bill. The assessment process laid out in the Bill and the extensive guidance—168 pages—available for it are extremely thorough and tough, and do not need to be added to. Amendment 24 undermines the assessment made by the Government of the issues relating to compensation and sufficient time to enable operators to plan. Provisions already in the Bill fully satisfy all value-for-money considerations. We are pleased that the Minister confirmed on Second Reading and in Committee that the aim of the process is not to put barriers in the way of authorities proceeding to franchising. We fear that the amendment threatens the very heart of the Bill. Amendment 25 also seems to be unnecessary, as additional appropriate independence, rigour and structure for the audit process will be ensured by the Government, to which I think the Minister is about to speak. Amendments 26 and 27 also seem at odds with the devolutionary nature of the Bill, because it should be for elected authorities to make the decisions, based on their local judgments.
We strongly support amendments 6, 7, 10, 11 and 13, tabled by my hon. Friend the Member for Gateshead. The arguments were well made in Committee, and perhaps even more strongly today. In any transfers workers should be properly protected, and we have the opportunity to ensure that. I fear that the Government will choose not to take the opportunity, but I urge them to do so.
Andrew Jones
The respective roles of central Government and local government were a running theme in Committee, and I think we are back to it this afternoon. I will begin with the amendments that deal with the franchising schemes.
The decision to move to a franchising system is a big one for any authority or combined authority to take, and it is therefore not to be undertaken lightly. It must have at its heart improvement for bus passengers, but it must be very much a local decision. That principle has underlain the Bill right from the beginning. We want to ensure that authorities contemplating franchising do so with their eyes wide open to the opportunities, the risks and the costs, and we expect them to have consulted widely on their proposals.
The Bill sets out clearly the processes that authorities must follow before they can implement franchising. Those include developing an assessment of the proposed franchising scheme—in effect, a business case. As part of that assessment, the authority must consider the value for money and affordability of the proposal and must compare making the proposed scheme with other courses of action, such as a partnership—very much as my hon. Friend the Member for North West Norfolk (Sir Henry Bellingham) suggested.
Several of the amendments in the group would change how those arrangements are operated. Amendment 24, tabled by my hon. Friend, would require an authority to include in its assessment consideration of whether the proposed scheme will be more efficient, effective and economic than any other option, taking into account any compensation payable to operators. Given the extensive requirements I just set out, I do not see a need to make those similar additional matters a separate part of the assessment. Also, it is not necessary or appropriate to refer to compensation in this part of the Bill, or indeed any other. Any move to a franchising scheme will not come as a surprise to bus operators; the clear processes and consultation arrangements we have set out will give them sufficient warning and sufficient opportunity to express their views on the proposed scheme, as statutory consultees.
Graham Stringer
The Minister says that competition will continue, but does he accept the evidence that the Transport Committee took from the Competition Commission, which was that the commission was unable to find much evidence of any on-road competition?
Andrew Jones
My point is that competition will move, but it will not disappear from the market. Competition now takes place on the road; it will move from the roadside to the tender. I do not accept that competition disappears from the marketplace. I came to this place from a robust private sector background, where competition was the daily bread-and-butter activity, and I am sure that it can have a positive impact on customer service, innovation, price and so on.
Robert Jenrick
The Minister kindly met my constituent John Marshall, who in addition to running a medium-sized bus company chairs the east midlands passenger transport organisation that represents other small and medium-sized bus companies in the region. He tells me that for him and his members, the question of compensation remains unanswered by the Bill. For the sake of clarity for bus operators, will the Minister say whether the Government intend that in the event that franchises are lost, no compensation will be or should be paid to any bus company in the UK?
Andrew Jones
We do not think that it will be a requirement to pay compensation, but an authority that goes down the route of developing a franchising model will of course be free to offer payments as it sees fit. It is not Government policy that such compensation will be mandatory.
Amendments 16 to 23, which were tabled by my hon. Friend the Member for North West Norfolk would require a franchising authority to be satisfied of, rather than to consider, certain matters when making its assessment of a proposed franchising scheme. That is a significant distinction. The assessment as set out in the Bill does not require the authority to pass certain tests or to prove that franchising would achieve certain outcomes. Instead, it reflects the standard approach for public sector investment decisions of requiring a view to be taken on the overall merits of the scheme.
That is a deliberate move away from the quality contract scheme process, under which no local transport authority has established a franchising system. A requirement for a franchising authority to satisfy itself that franchising will deliver certain outcomes risks raising an impossible hurdle. It would be difficult for authorities to satisfy themselves with certainty, as their analysis, by its very nature, will be based on assumptions and projections about the future. The amendments therefore risk making the Bill unworkable in practice. We agreed to deliver as part of our devolution commitments franchising powers that would be more usable than the existing quality contract schemes, and that is what the Bill does. I hope that, on the basis of the explanations I have given, my hon. Friend the Member for North West Norfolk will not press amendments 16 to 24.
In addition to requiring a franchising authority to prepare an assessment, the Bill requires the authority to obtain a report from a qualified auditor. In relation to the consideration of affordability and value for money, the report must set out whether the authority has used information and conducted an analysis of sufficient quality. The authority must publish the auditor’s report as part of its consultation process. Amendments 2 and 3 make it absolutely clear that the auditor appointed for this purpose must be independent. It has always been our intention that the auditor should be independent, but we wanted to make that absolutely clear and put it beyond any doubt. Amendment 3 imposes duties on the Secretary of State to issue guidance on the matters that a franchising authority is to take into account when selecting an auditor and on the criteria to be taken into account by an auditor in reaching a view on the relevant aspects of the authority’s assessment. An authority or auditor must have regard to such guidance.
I am happy to say that I am in total agreement with my hon. Friend the Member for North West Norfolk on amendment 2. He may be surprised to hear that I also agree with the principle behind amendment 25, but the nuances of how independence from the authority can be demonstrated are better addressed through guidance rather than on the face of the Bill. That is the thinking behind amendment 3. For example, amendment 25 would require an auditor to have five years of independence from the authority, which could be difficult to deliver. For the combined authority of Manchester, for example, it would have to be demonstrated that none of the bigger accountancy firms had dealt with any of the constituent authorities on any issue over the past five years, which could be quite a challenge. However, the principle of independence has absolutely been in the Government’s thinking since the beginning. I support that principle, which is behind my hon. Friend’s amendment, and that is why I hope that he will feel able to withdraw amendment 25.
Sir Henry Bellingham
I am grateful to the Minister for his comments on amendment 25, but will it be possible to include the spirit of the amendment in the guidance that the Secretary of State will issue? If he can give an undertaking that that could happen, I would be prepared to withdraw amendment 25.
Andrew Jones
I can give my hon. Friend that assurance. We will deal with independence in the guidance, and independence from the decision-making body will be a basic criterion for the auditor.
Andy Burnham
I am reassured by what the Minister said this afternoon in rejecting amendment 14 and other related amendments. I ask him to go a little further and commit to the House that the spirit of his remarks today will be carried into the guidance and regulations that will follow the Bill—the consultation on them closed sometime last week. Will he also work closely with Transport for Greater Manchester and other metropolitan transport authorities to ensure that the wording of the regulations and the guidance is consistent with what he has said today and what is in the Bill?
Andrew Jones
I can provide the right hon. Gentleman with that assurance. We are not seeking to stand in the way; we want to create a suite of powers for local authorities to make decisions about what is right for their area. In some cases, it will be a franchising model, but that will be at the margins and not what will happen in most parts of the country. However, some parts, such as Greater Manchester, have indicated much interest in that model. It is not one of our objectives to block local authorities from choosing what is right for their area. We want a thriving bus industry, with local authorities working with bus operators to deliver a better network with a better deal for passengers and more passengers on buses. That is our objective with this Bill.
Amendments 4 and 5 make clear the precise requirements that a person has to satisfy to be appointed as an auditor. We are proposing the changes in response to effective representations we have received from a number of Members and following meetings that the Secretary of State and I have had to discuss the practicality of existing provisions with potential auditors. I hope that the amendments will be broadly supported by Members across the House.
The aim of amendments 14 and 15, once again tabled by my hon. Friend the Member for North West Norfolk, is to prevent a franchising scheme from proceeding if the passenger benefits it is expected to deliver could be achieved by making a partnership scheme. I sympathise with much of my hon. Friend’s intentions. Indeed, my hon. Friends the Members for North West Norfolk and for Wimbledon (Stephen Hammond) have done a significant job in speaking up on behalf of bus passengers for a considerable time. I do not want to see franchising pursued for any reason other than passenger benefit, and certainly not for ideological reasons. Passenger benefit is a theme that runs throughout the Bill. We want to see passenger experiences improve.
As I have made clear, however, the Bill already requires a local transport authority to compare making a franchising scheme with one or more other options. I hope that my hon. Friend the Member for North West Norfolk will be reassured to know that that should be a proper consideration of the options available. Indeed, the draft guidance, on which we recently consulted, states:
“Identifying realistic options should not be a desk exercise… and authorities should engage with bus operators in the area”
to see whether there is “a realistic partnership proposition”. It also states that an
“authority should not dismiss realistic”
alternatives without detailed assessment. The decision-making arrangements for franchising in the Bill are appropriate. Following a consultation on its assessment of the options, which should include bus operators and passenger representatives, an authority that decides to implement franchising must have satisfied itself that franchising is the right option for its area. Importantly, it should have a clear rationale for that decision with passengers at its heart. I therefore hope that my hon. Friend the Member for North West Norfolk will feel able to withdraw amendments 14 and 15.
The final set of amendments relating to franchising decisions are also from my hon. Friend the Member for North West Norfolk. Amendments 26 and 27 aim to prevent an authority that has developed a franchising proposal, but not progressed it, from making another franchising scheme for a period of five years. Those amendments go against the spirit of devolution. Banning the introduction of a franchising scheme for an arbitrary time period would severely restrict the capacity of an elected mayor, or other franchising authority, to take local situations into account and to act accordingly. It could also undermine the democratic process by preventing a new mayor elected within the five-year period from developing a franchising scheme, even if he or she had had franchising in their manifesto. In practice, if an attempt to franchise were to fail, it is highly unlikely that an authority would seek to make another scheme without devoting a reasonable and significant period of time to learning lessons from the experience. Given that, I hope that my hon. Friend will withdraw the amendments.
I will now move on to consider how much freedom a mayor or local transport authority should have in implementing franchising and partnership schemes. Amendments 6 to 13 and new clause 4, tabled by the hon. Member for Gateshead, seek to limit that freedom in various ways. As I said in Committee, I do not believe that mandating the basis upon which contracts are procured by local transport authorities, or the contents of those contracts, is appropriate, but that is exactly what amendments 6 and 9 propose in relation to the terms and conditions of employees. I can assure the hon. Gentleman that the power to achieve the outcome that the amendments seek will already rest with the franchising authority that will be letting the contracts. Employees and their representative groups will have plenty of opportunities to raise such points during the consultation process for the respective schemes. Indeed, it may be appropriate to put the proposals to the mayoral candidates of each of our parties.
I am a little surprised that the amendments have been tabled, because we discussed the practical concerns about them in Committee. For example, it is not clear which terms and conditions would apply where people with different arrangements had previously transferred under TUPE, and the cost of the proposals could also prove sufficient to prevent some authorities from pursuing a franchising scheme.
Ian Mearns
Does the Minister accept that injuries can also occur to passengers? As a regular bus user, I have witnessed such injuries on a number of occasions. This is not only about pedestrians and other road users. Bus passengers, often without the vehicle being involved in any sort of collision, can be injured when, for instance, the bus brakes abruptly. Surely the travelling public on buses—the customers of the bus operators—have a right to some Government protection.
Andrew Jones
I recognise the hon. Gentleman’s point. There is no doubt that passengers can be injured on a bus. I am also a regular bus user—not that that is particularly relevant—and all of us who travel on buses will have seen such injuries. He makes a reasonable point, but it does not necessarily mean that we need to mandate a reporting system in primary legislation.
Transport for London is the main example of confidential reporting by a bus operator, and it has featured in our debates in Committee. I understand that TfL pays the CIRAS subscription. When the London Underground and rail contract came up for renewal, the CIRAS contract was extended to cover buses at no extra cost to TfL. That prospect is different from mandating that every bus operator subscribes to such a system.
As I mentioned in response to an intervention by my right hon. Friend the Member for Basingstoke (Mrs Miller), there are 30 rail companies and 1,000-plus bus companies in this country. We also need to consider the evidence. I have not been made aware of any robust evidence to suggest that arrangements introduced in London have had a significant impact on safety. If a franchising authority wishes to stipulate a system such as CIRAS as part of its conditions of contract, it is of course free to do so—that is what TfL has done here in London. Authorities that negotiate partnerships could also include bus safety measures as part of such an arrangement, so I will explore through guidance how we could encourage operators and local transport authorities to consider the benefits of an independent confidential reporting system, but we will probably limit that only to a franchising or partnership scheme to start with.
I hope that, in the light of my comments, the hon. Member for Gateshead will feel able not to press amendments 6 to 13 and new clause 4.
I have been speaking for far too long, Mr Deputy Speaker. I am sure that you and Members on both sides of the House will be pleased to hear that I am coming to the end of my remarks.
Amendment 28, tabled by my hon. Friend the Member for North West Norfolk, addresses decision making in enhanced partnership schemes. It would prevent requirements on how tickets are purchased or fares paid, on how fares or ticketing arrangements are publicised and on the price of multi-operator tickets from being specified in such a scheme unless all parties agree. Ticketing is a key element of the Bill’s partnership proposals, and one of the key principles of the enhanced partnership regime is that it does not require consensus by all operators.
Instead, affected operators may object to the enhanced partnership proposals at key points in the process, and the authority cannot proceed with its proposals if more than a sufficient number of operators object. Details of what amounts to that sufficient number will be set out in the draft regulations, on which we have recently finished consulting.
Leaving aside the objection mechanism, there are further safeguards to ensure that individual operators are treated fairly when ticketing requirements are included in an enhanced partnership scheme. A key safeguard is the ability for any proposals relating to ticketing, or any other element of an enhanced partnership scheme, to be subject to scrutiny by the Competition and Markets Authority, which will be a statutory consultee on the proposals. Our draft guidance on enhanced partnerships also makes it clear that all documents should include a section on competition, and it provides clear advice on how individual operators can raise concerns with the CMA at any point during the development or implementation of a scheme.
Perhaps most importantly, I can reassure my hon. Friend that an authority making a scheme has to be satisfied that any restrictions on competition introduced by an enhanced partnership, such as setting the price of a multi-operator ticket, are balanced by the benefit to passengers. The effect on small and medium-sized bus operators should also be taken into account as part of that process, and we have built protection for small and medium-sized operators into the Bill by requiring them to be considered, whichever regulatory model is chosen locally.
I make it clear that the provisions are about fairness, and not about protecting the commercial interests of operators. Bus operators may well prefer their passengers to buy a ticket for use only on their buses, rather than one that can be used on any bus service. That is of course in a bus operator’s commercial interest, but it might not necessarily be in the interest of a bus passenger.
If my hon. Friend’s amendment were to be accepted, only one operator would need to put its commercial interests first to block an improvement to ticketing for passengers that might grow the entire market in its area. Overall, the safeguards I have outlined are enough to ensure that proposals relating to ticketing are fair and reasonable to bus operators while delivering improvements that benefit passengers. I hope he finds my explanation reassuring and will therefore not press his amendment.
I believe the Bill already has decision making right and is in the right place to get the best outcome for passengers. In doing so, it will deliver on our devolution commitments, and I trust the House will agree.
Ian Mearns
I would like to think that the Minister will provide within the guidance to the Bill, once it is enacted, a reference to the Confidential Incident Reporting and Analysis System as best practice in the industry. Notwithstanding that, I do not seek to press the new clause or amendments 6 to 13. I beg to ask leave to withdraw the clause.
Clause, by leave, withdrawn.
Clause 4
Franchising schemes
Amendments made: 2, page 16, line 38, after “an” insert “independent”.
This amendment and amendment 4 make plain the status of the persons who may audit an assessment under section 123B produced by a franchising authority or authorities.
Amendment 3, page 17, line 2, at end insert—
“( ) The Secretary of State must issue guidance as to the matters to be taken into account by a franchising authority when selecting a person to act as an auditor.
( ) Franchising authorities must have regard to any such guidance.
( ) The Secretary of State must issue guidance concerning the matters to be taken into account by an auditor when forming an opinion as to whether the information relied on, and the analysis of that information, by an authority is of sufficient quality for the purposes of subsection (2).
( ) Auditors must have regard to any such guidance.”
This amendment imposes duties on the Secretary of State to issue guidance on the matters to be taken into account by a franchising authority when selecting a person to act as an auditor and to issue guidance on whether the information relied on, and the analysis of that information, by an authority is of sufficient quality. It also imposes duties on franchising authorities and auditors to have regard to any such guidance.
Amendment 4, page 17, leave out line 3 and insert
“For the purposes of this section an auditor is independent, in relation to an assessment of a proposed franchising scheme, if the person would not”.
See explanatory statement for amendment 2.
Amendment 5, page 17, line 8, leave out from “person” to end of line 9 and insert
“eligible for appointment as a local auditor by virtue of Chapter 2 of”.—(Andrew Jones.)
This amendment alters the definition of “auditor” so that it means an individual or firm eligible for appointment as a local auditor by virtue of Chapter 2 of Part 42 of the Companies Act 2006 as modified by the Local Audit and Accountability Act 2014.
Clause 22
Bus companies: limitation of powers of authorities in England
Daniel Zeichner
I beg to move amendment 1, page 78, line 4, leave out clause 22.
This amendment would remove Clause 22.
Amendment 1, which appears in my name and those of my hon. Friends the Members for Middlesbrough (Andy McDonald), for Birmingham, Northfield (Richard Burden) and for North West Durham (Pat Glass), would remove the clause that bans county and district councils in England, combined and integrated authorities in England and passenger transport executives in England from setting up companies to provide local services. In short, we seek to overturn the Government’s ban on municipal bus companies.
This clause is a piece of ideological dogma that has no place in an otherwise agreeable piece of legislation. We visited this issue in Committee and I fear that the Government are not minded to budge, but I and many others found the Government’s arguments there extremely unconvincing. In Committee, the Minister said:
“Our view is that passengers will see the most benefit where the commissioning and provision of bus services are kept separate…as such we do not think authorities should be able to set up new bus companies.”––[Official Report, Bus Services Public Bill Committee, 14 March 2017; c. 57.]
The Opposition also want passengers to see benefits; we simply do not agree that municipal bus companies cannot be a part of achieving those benefits.
The latest annual Transport Focus bus passenger survey, which was published just last week, demonstrates once again that municipal bus companies provide some of the best services in the country. Nottingham City Transport and Reading Buses—municipal bus companies —had higher overall satisfaction results than the big five private national bus operators. The Government’s attempted ban on new municipals therefore flies in the face of all the evidence.
The ban also flies in the face of the Government’s purported commitment to the spirit of localism and devolution, which they claim the Bill encapsulates. Although they say that the Bill will provide local authorities with a range of options and tools, and that local authorities are best placed to make a decision about how local bus services are organised and run, they are imposing an arbitrary ban on one of those options—and not just any option, but one that has been shown to work very well for passengers.
Of course, many of us suspect that the clause is about pacifying some private bus operators, which the Minister once said
“are already on a journey here”.
Without wishing to rehash every fine point from the Committee, we do not see municipalisation and competition as necessarily antithetical. In fact, it is the Government who are undermining their long-held admiration for competition by imposing barriers to the market to stop municipal bus companies competing with private bus companies. Are the Government really afraid that local authority-run bus companies might just be better? The Competition Commission has reported that it has seen no evidence that municipal operators distort competition in the bus market.
Ian Mearns
Ministers have short memories about how an awful lot of the big bus franchise companies came about in the first place. Some of them were based on old municipal bus companies, which were sold off at a pittance with their entire estates of bus depots, bus parks and vehicles, only to be floated on the market a matter of months later for 10, 15 or 20 times the price at which they were bought in the first place.
Daniel Zeichner
My hon. Friend is absolutely right. Some of the people who worked on the buses in that period still feel very aggrieved by the process that was gone through 30 years ago, which left so much of our country with services far poorer than the universal coverage that was available at the time.
The Competition Commission suggested that municipal companies might be minded to run services and routes that make less sense for economic reasons—perhaps those unprofitable routes and services that bus operators have been cutting left, right and centre. The Institute for Public Policy Research has also described municipal bus companies as an innovative transport solution that demonstrates that
“conventional commercial operations are not the only option.”
Sadly, they soon will be if the Government have their way with this measure.
Daniel Zeichner
I will give way to my hon. Friend the Member for Blackley and Broughton (Graham Stringer) first.
Graham Stringer
Two have come at once! Does my hon. Friend agree that, aside from the reasons given by the Competition Commission, municipal bus companies can provide a benchmark? In a rational debate, we should be able to get from the Government a reason why, when municipal bus companies have performed in an excellent way, they are not allowed to compete. Does he agree that that reason was not forthcoming in Committee?
Daniel Zeichner
I very much agree with my hon. Friend. The point about keeping the market honest is important. When I was first elected as a local councillor, the housing officer told me that one of the roles of an in-house operation was to keep the market honest. That is an important role.
Daniel Zeichner
I give way first to my hon. Friend the Member for Nottingham South (Lilian Greenwood).
Lilian Greenwood
Is not one reason that Ministers have given for objecting to municipal operations that they would prevent the market from operating effectively? When we look at the latest bus passenger survey, is it not interesting that Nottingham City Transport has the highest value for money of any single operator in the country?
Daniel Zeichner
My hon. Friend consistently makes the case for Nottingham. That is made far easier for her by the excellent local services she has. People from my city of Cambridge have gone to Nottingham to see how to do it. Part of the lesson is that a municipal can do it really well, but according to the Bill, that will not be possible.
Andy Burnham
The Minister stressed the importance of vigorous competition. Is it not the case that if a franchising process were used, the existence of the municipally owned option would enable those doing the franchising to drive an even harder bargain on behalf of the public, because there would be that fall-back option if the private sector could not come up with the goods? Therefore, would it not enhance competition and enable the passenger transport authority to get an even better deal for the public?
Daniel Zeichner
My right hon. Friend is correct yet again. Interestingly, much of the discussion in Committee was about moving competition from on the road to off the road. I think we agree that in areas where there has not been competition, franchising would be far from a less competitive system. People in London talk about just how competitive the system is, so no Government Member should be worried about a lack of competition. My fear—this is why it is so important that we have protection for the workforce—is that if we are not careful, competition can bring the risk of a race to the bottom. That is why we believe that we should have the provisions that we have just debated. I think the evidence is clear that the franchising system would benefit from having municipals as an alternative.
The conclusion of the Opposition is that banning local authorities from running their own bus companies is slightly unworthy of the spirit behind the Bill. The evidence is clear that they work for bus passengers and are able to put social values at the heart of what they do. This measure has drawn the attention of the public more strongly than other parts of the Bill. It has rightly brought a strong reaction from local councils across the country. They do not understand why they should be prevented from doing something that they strongly believe is in the interests of their local constituents. Some trade unionists feel strongly about this measure, as do passengers, and I pay particular tribute to the organisation We Own It, which has campaigned strongly against it. We believe that this is a petty measure that sits uneasily with the rest of the Bill, and I urge the Government to look at it again and accept our amendment today.
Sir Henry Bellingham
I just wish to say that I am grateful to the Minister for his response to my amendments in the previous group. I was not quick enough on my feet to catch your eye at the time, Mr Deputy Speaker, but I have been in this place long enough to know that one should quit when in front. I am grateful to the Minister for saying that my amendment 25 is going to be incorporated in the guidance and for the useful reassurances he has given me on amendments 15, 26, 27 and 28. I was disappointed on the issue of compensation, but, as he pointed out, there can indeed be scope for the authorities to compensate if need be. On that basis, I will not seek to press those amendments to a vote, although I say so a touch belatedly.
Mrs Ellman
I rise to support amendment 1, for the reasons given by my hon. Friend the Member for Cambridge (Daniel Zeichner). This is all about devolution and local transport authorities deciding what is best for their areas. No good reason has been put forward for not permitting new municipal operators as an option. The Government have expressed concern about possible conflicts of interest, but that cannot be taken seriously. We need look no further than the experience in Nottingham, as cited by my hon. Friend the Member for Nottingham South (Lilian Greenwood), and in Reading to see that there is the perfect ability—this has already been done in those areas—for the proper distance to be established between the local authority as a local authority and the transport operator as an operator in terms of letting out franchises. The Bill is about giving more local choice, and it is entirely unjustifiable to remove from local authorities the option of having a municipal operator. The Department has found a way to put forward complex regulations on franchising and if it still has concerns about this topic, regulations could also be introduced on setting up municipal bus operations. I therefore urge the Government to think again.
Lilian Greenwood
I support amendment 1, and we had a long discussion on this issue in Committee. I spoke then and on Second Reading about the success of Nottingham’s municipal operator, and so, much as I love Nottingham City Transport, I will restrain myself and not repeat myself.
I continue to question the Government’s motivation for their determination to ban local transport authorities from establishing new municipal bus companies, as Ministers have simply not made the case for such a ban. The Transport Committee, chaired so ably by my hon. Friend the Member for Liverpool, Riverside (Mrs Ellman), describes it as a “disproportionate response”. Clearly, this measure is anti-localism and it prevents councils from acting in the best interests of their residents. In Committee, the Minister said that there should be a split between the commissioning and the provision of bus services. I do not disagree on that, but this ban goes far beyond that. As was noted in Committee, local authorities with municipal operators have proved themselves very capable of managing just such a split when tendering for supported services.
In Committee, the Minister also suggested that the existence of municipal bus operators
“could easily deter investment from the private sector”.
When I asked him what evidence he was drawing on in making such an assertion, he admitted
“of course we do not have any evidence for it. I am just looking at what the risks may be.”––[Official Report, Bus Services Public Bill Committee, 14 March 2017; c. 67.]
The Minister’s risk aversion is simply unnecessary and can be shown to be such. Nottingham has an excellent municipal operator, but it does not deter private sector investment; as the hon. Member for Newark (Robert Jenrick) mentioned, we have excellent private sector operators in Nottinghamshire, such as trentbarton. I hope that even at this late stage the Government will rethink their commitment to what I can only describe as an ideological obsession, and take this opportunity to end their unreasonable position and accept amendment 1.
Andrew Jones
This amendment, tabled by the hon. Members for Cambridge (Daniel Zeichner) and for Middlesbrough (Andy McDonald), proposes to remove clause 22. We debated this at length in Committee and I wish to reiterate that the several existing municipal bus companies, including Nottingham City Transport and Blackpool Transport, which serves the area of the rail Minister—my hon. Friend the Member for Blackpool North and Cleveleys (Paul Maynard)—deliver a high standard of service, and I will expect that to continue. Their ability to provide that is not affected in any way by this clause. The franchising and enhanced partnership tools in the Bill will provide authorities with more influence over bus services than they have now, and striking that right balance between local authority influence and the role that the private sector bus operator can play is important. Our view is that passengers will see the most benefit where the commissioning and provision of bus services is kept separate. As such, we do not think that authorities should be able to set up new bus companies.
We have seen encouraging innovations from the private sector—although not exclusively within that sector—such as the introduction of smartcards, the installation of wi-fi and increased accessibility in our bus network. Those improvements have all been delivered through private sector investment and they show overall that the industry is always innovating and delivering a good deal for its passengers.
Ian Mearns
The Minister will be aware that over the past six and a half years local authorities up and down the country have seen significant and ongoing reductions in their revenue support grant. Ministers from the Department for Communities and Local Government have always been encouraging local authorities to be entrepreneurial and enterprising, and to go out there and earn money to backfill where the RSG once existed. By this measure, the Minister is precluding local authorities from doing just that.
Andrew Jones
I recognise what the hon. Gentleman says, but it is also fair to say that no local authority has either set up a municipal bus company or approached me with a view to doing so. Therefore, this is in some ways a slightly notional or theoretical debate—[Interruption.] Making sure we get clarity is the entire point here.
This Bill seeks a balance between local authority influence—we are providing local authorities with a variety of tools to address local issues—and the role that private sector bus operators can play, in order to ensure that both are incentivised to deliver the very best services for passengers. This Bill is about local authorities and commercial bus operators working together to improve local bus services. It is about co-operation, all designed to improve the benefits for bus passengers. I hope that this has made the Government’s position clear and that the hon. Member for Cambridge will not press this amendment to a vote.
Daniel Zeichner
The Minister has finally let the cat out of the bag. If there has not been a queue of local authorities coming to him with requests to form companies, he does not really need to legislate to ban them from doing so. This is pure ideology. There has been a great deal of agreement on the Bill—we have found a lot of common ground—but on this issue, I assure the wider world that there is clear red water between the Opposition and Government Benches. We will press the amendment to a Division, and its effect will be achieved by a future Labour Government.
Question put, That the amendment be made.
Mr Speaker
Consideration completed. I will now suspend the House for no more than five minutes in order to make a decision about certification. The Division bells will be rung two minutes before the House resumes. Following my certification, the Government will be tabling the appropriate consent motion, copies of which will be available shortly in the Vote Office and will be distributed by Doorkeepers.
Mr Speaker
I can now inform the House of my decision about certification. For the purposes of Standing Order No. 83L(2), I have certified the following provisions of the Bus Services Bill [Lords] as relating exclusively to England and within devolved legislative competence: clauses 1, 3 to 7, 9 to 14, 16 and 18 to 22 of, and schedule 2 to, the Bill, as amended in the Public Bill Committee, and including amendments made on Report. Copies of my certificate are available in the Vote Office.
Under Standing Order No. 83M, a consent motion is therefore required for the Bill to proceed. Does the Minister intend to move a consent motion?
Mr Speaker
A simple nod of the head would suffice, but the Minister said it with eloquence and charm to which he is no stranger.
The House forthwith resolved itself into the Legislative Grand Committee (England) (Standing Order No. 83M).
[Mr Lindsay Hoyle in the Chair]
The Chairman
I remind hon. Members that, if there is a Division, only Members representing constituencies in England may vote on the consent motion.
Resolved,
That the Committee consents to the following certified clauses of, and schedule to, the Bus Services Bill [Lords]:—
Clauses and schedule certified under Standing Order No. 83L(2) as relating exclusively to England and being within devolved legislative competence
Clauses 1, 3 to 7, 9 to 14, 16 and 18 to 22 of, and Schedule 2 to, the Bill as amended in the Public Bill Committee (Bill 158) including any amendments made on Report.—(Andrew Jones.)
Question agreed to.
The occupant of the Chair left the Chair to report the decision of the Committee (Standing Order No. 83M(6)).
The Deputy Speaker resumed the Chair; decision reported.
Third Reading
Andrew Jones
I beg to move, That the Bill be now read the Third time.
I am grateful to all hon. Members who have engaged so constructively with the passage of the Bill, and demonstrated their shared commitment to improving bus services and increasing bus passenger numbers.
Buses are already England’s most used form of public transport, accounting for more than 4.5 billion passenger journeys a year. They are vital to the economy, connect our rural and urban communities to employment, schools, hospitals and leisure, and are used by people of all ages. That is why the Bill has bus passengers at its heart. It allows local authorities and operators to adopt measures to improve services and grow passenger numbers. This is, therefore, an enabling Bill that is fundamentally about improving bus services for passengers, and that recognises the need for local solutions to local transport problems.
By working together, local authorities and operators can tackle key transport issues, such as pollution and congestion. They can support local businesses and help to drive the local economy. The Bill introduces a range of tools that will achieve those aims. It builds upon the success of partnership working. Local authorities and operators can agree the standard of services in a particular area. This could include multi-operator tickets, better connections between transport modes and improved vehicle standards, all of which will drive an increase in bus usage and increase performance. I emphasise that this part of the Bill has been widely welcomed by local authorities, operators and hon. Members, although it is, of course, not the only opportunity that the Bill brings.
The Bill will bring the opportunity to refresh powers for local authorities to franchise, delivering on our devolution agenda. It is only right that many of our larger cities have the opportunity to make franchising a success, just as TfL has done in London. Of course, franchising is not for everyone, and authorities must have a compelling case to implement such a scheme. I am of the firm belief that the Bill, as amended by this House, will deliver a better standard of bus services. It reinstates automatic franchising powers to mayoral combined authorities, which will preserve a degree of commercial certainty and help to maintain the significant private sector investment that we have already witnessed in the bus market. In addition, the requirement of an independent auditor as part of the assessment for franchising schemes will ensure that a scheme is implemented only with proper scrutiny.
A necessity to buy separate tickets or to pay with cash when travelling by bus can be frustrating and costly. Authorities will, therefore, have improved advanced ticketing powers to create multi-operator ticketing schemes that cover not only buses but other modes of transport such as tram or light rail. They can also make use of emerging technologies such as contactless and Bluetooth ticketing. The Bill will make it easier for passengers to access information on timetables, fares and routes. App developers will be encouraged to develop innovative products that will make this information available to passengers. I firmly believe that these improvements will deliver significant benefits to passengers, and will therefore attract more people on to public transport.
The Bill will also deliver accessibility improvements. Indeed, the audio-visual provision introduced in the other place has attracted more public attention than any other part of the Bill. It has certainly dominated my inbox more than any other matter by a factor of many. The provision will ensure that bus services in England, Wales and Scotland are accessible to those with a hearing or sight loss disability and, at the same time, will provide valuable information to all passengers. I know from personal experience the importance of next-stop announcements in London and elsewhere. All passengers will benefit from this significant improvement.
I want to see the bus market thrive and encourage more people on to public transport. As I said at the beginning of this speech, the Bill will have significant benefits for the environment, congestion and the local economy. Ultimately, we seek to reverse a decline in bus usage and put passengers at the heart of bus services. I thank all hon. Members who have engaged and contributed to the Bill, especially those on the Bill Committee, as well as the Committee Clerks and parliamentary counsel for all their work. I particularly thank my team within the Department. A significant amount of hard work has got us to this point. We have a good Bill that has been welcomed widely and reflects the importance of buses in local communities. We want the bus industry to thrive, and that is what has driven the Bill. I commend it to the House.
Andy McDonald
I will pick up where the Minister left off and thank everyone who has contributed to the Bill, especially my hon. Friends who served on the Public Bill Committee, and the officials. I pay tribute to the wonderful work of the Transport Committee and everything it has done on this matter. I also thank hon. Members’ staff for their efforts, particularly Juliet Eales, who is soon to leave the shadow Transport team, but whose contributions have been invaluable throughout the passage of the Bill.
The Bill is ultimately underlined by broad consensus, which has been reflected in the generally cordial spirit of our debates. At its heart, the Bill offers local authorities the opportunity to improve the way in which buses are run in their areas, should they choose to take it. We have fought for this over many years—first, 17 years ago through legislation that failed to make the impact we had hoped, and then from the Opposition Benches for seven years. Since 2010, we have sadly heard, time and again, of bus routes axed, constituents campaigning hard to keep their vital local bus service, and disabled people, jobseekers and students unable to afford the rocketing cost of travel. We have heard these issues, and we have fought for a revision of the bus market to give local areas the power and flexibility to control their bus services as local circumstances best allow.
Although the Bill is not perfect and is certainly not the silver bullet to fix the bus system across the whole country, there is much to be positive about. Mayoral combined authorities will now be able to unlock powers to regulate their bus services, increasing parity between areas such as Greater Manchester and London. We have fought to ensure that those powers can be accessed without delay, and that the process for bringing in those powers will be clear and free from hidden barriers. We had hoped that all areas of the country, whether they have an elected mayor or not, would have access to those powers, but we will have to continue that argument another day.
The Bill provides new partnership options to local authorities for working alongside bus operators. We hope that local authorities will be encouraged to use these new tools to improve journey times and vehicle standards, and consequently to reduce congestion—huge environmental and health issues that affect us all. The Bill gives the Secretary of State the power to make regulations requiring buses providing local services to have in place audio-visual information systems. We are so pleased that the Government included this provision following strong pressure from Labour in the other place, and an excellent campaign from Guide Dogs. That measure could make a real difference to people’s lives.
What is missing? Stronger employment protections, clearer accessibility provisions and bus safety improvements. We fought for those and we won the arguments, but we lost the votes. That is the tragedy of being in opposition. The Bill could have been better, and we were disappointed by the lack of movement from the Government in these areas. The Bill is not perfect, but it will go some way to reversing the damage of deregulation that we have fought to fix for three decades. Going some way to reversing that damage is better than going no way at all. For that reason, and on behalf of all those constituents waiting at bus stops right now, we will support the Bill on Third Reading.
Mrs Theresa Villiers (Chipping Barnet) (Con)
I assure the House that my contribution on this important Bill will be brief.
The partnership provisions in the Bill are welcome and important. Partnership working between local authorities and private sector bus companies has delivered a whole range of improvements for passengers in many parts of the country. The goal of the Government here should be to focus on encouraging that kind of co-operation, whereby the business acumen and expertise of the private sector can work alongside the local understanding and commitment of local authorities, so those provisions in the Bill are welcome. During the passage of the Bill, hon. Members have cited a number of positive examples of different parts of the country, such as Brighton, where partnerships between private sector operators and local authorities have had a transformative and positive effect on services.
I regret that I was not able to be here for the debate on the amendments that I and my hon. Friend the Member for North West Norfolk (Sir Henry Bellingham) tabled, but I very much welcome the assurances given by the Minister on a number of them and the recognition of the importance of a number of the principles contained in them. In particular, I urge him to take seriously the objectives of amendments 14 and 15, and I hope the guidance issued will clearly set out the fact that franchising schemes should be a last resort and will be approved only if partnership working will not deliver the benefits that are sought for passengers.
I warmly welcome the Secretary of State’s support for amendment 2. Ensuring that those who audit a franchise assessment are properly independent significantly strengthens the Bill. It would be unfortunate if those checking out a franchise assessment were not independent of the local authorities essentially making the decisions on franchising authorities.
To return to a theme I talked about at some length on Second Reading, I hope the Government will do everything they can to facilitate certainty in the private sector bus operators market, because that certainty is the key to investment in new fleet, better ticketing measures and a range of passenger improvements. Anything that leads to uncertainty could jeopardise investment, which would have a negative effect on passengers. I particularly have in mind the importance of delivering smarter ticketing, which is crucial not only for passengers’ convenience but in persuading them that the bus can more often be an attractive and viable alternative to the car.
There is a certain irony in the fact that it is a Conservative Government who are taking through this Bill, which, as the House is aware, partially rolls back one of the major privatisations of the Thatcher era. There are mixed views on the role of private sector bus operators in delivering transport services, but I believe they have brought significant benefits for passengers, and I hope nothing in the Bill is allowed to jeopardise the reliance on the expertise and investment that the private sector has brought to bus operations over the years.
Mrs Villiers
I am afraid I am about to conclude, but the right hon. Gentleman will get his chance very soon.
I close by once again thanking the Minister for his assurances that he takes seriously the points raised in the amendments and for commending partnership working between the private sector and local authorities, which is one of the best ways to deliver improvements for passengers.
Mrs Ellman
The Bill is an important step in achieving a modern, thriving bus sector, and I welcome it. In doing so, I pay tribute to the Minister and his colleagues and to the shadow team for the work they have done. I also commend all the members of the Transport Committee for the work they did in scrutinising the Bill. Although some of the points we made have not been acted on, some have been considered, and this is now a better Bill.
I first spoke on bus deregulation a very long time ago. When it was introduced through the legislation in 1985, I was the leader of Lancashire County Council. I opposed the legislation very strongly because I was concerned it would result in a reduction in bus patronage outside London, and the intervening years have indeed shown that it did. The Bill does not repeal that legislation, but it does make substantial changes to it, which I very much welcome.
A thriving, comprehensive bus network across England is not an optional extra but an absolute necessity. The basic principle of the Bill—that there should be more devolution, and that local transport authorities should decide what is best for their areas—is the right one, and I welcome it very much. Although I am disappointed that the Government have not gone as far as I would have wished in some areas, I welcome the Bill as we have it now.
I welcome the provisions on the accessibility of buses, and particularly those on access and information for people who are impaired. If information about bus services and the operation of individual buses is made more accessible to people who have a disability, everybody else benefits as well, so it improves the bus sector as a whole.
I thank everyone who has been involved in the Bill. It makes major strides in producing better bus services for the people of this country—those who currently use our buses and those I hope will do so in future—and I am pleased to support its Third Reading.
Andy Burnham
Bus services are the mainstay of the public transport system, yet, historically, the House has given them comparatively little attention, and I am pleased that the Bill begins to correct that.
I congratulate the Secretary of State, the Minister and, indeed, the Government on the way they have stuck to the terms of the devolution deal and delivered a Bill that will bring real benefits to the travelling public in Greater Manchester and beyond. I also congratulate those on the Labour Front Bench on the constructive way in which they have engaged in this debate.
It is also appropriate to congratulate council leaders in Greater Manchester. The Bill was a clear demand of Labour leaders in Greater Manchester as part of the devolution deal struck with the former Chancellor of the Exchequer, so it is, in effect, as I think the right hon. Member for Chipping Barnet (Mrs Villiers) was hinting a moment ago, a Labour Bill and, I am proud to say, a Greater Manchester Bill. In that sense, the Opposition take great pride in it clearing its Third Reading tonight.
Ian Mearns
My right hon. Friend is making a very interesting speech, but he should not put bad ideas into the Government’s mind—they might change their mind and vote against the Bill.
Andy Burnham
Well, I will call it a partnership Bill, if that makes my hon. Friend feel a bit more at ease. It is certainly a rare example of common sense breaking out on both sides of the House.
I want to pay particular tribute to my hon. Friend the Member for Liverpool, Riverside (Mrs Ellman). As she said a moment ago, she has consistently spoken of the damaging effects of bus deregulation—the free-for-all, the decline in the quality of services and the increase in fares. She has been consistent, and she is vindicated tonight as the Bill finally goes through the House. So, too, is my hon. Friend the Member for Blackley and Broughton (Graham Stringer), who made the same argument throughout the years, including under the Labour Government, and who has waited a long time to see this Bill come to pass.
To be successful in the new role that I seek, I will seek to use the powers in the Bill for the benefit of the travelling public in Greater Manchester. For 32 years, we have had a bus service that has been run for private vested interests rather than in the public interest. Only last week, a whole new series of service alterations were announced that will decrease the quality and coverage of services across Greater Manchester, with no real ability for communities to challenge those decisions. Well, that way of running bus services is coming to an end.
Lilian Greenwood
I am very much enjoying my right hon. Friend’s speech. Does he agree that, contrary to what the right hon. Member for Chipping Barnet (Mrs Villiers) said, the Bill seeks to enhance competition and the role of the private sector by having really effective competition off the road? On-road competition has not delivered for passengers.
Andy Burnham
That is absolutely the point. If we construct a franchise process that really puts the public interest first, and we then ask the private sector to meet that public interest, that will be a much better system; indeed, it is the system the right hon. Lady’s constituents benefit from in London. The question I was going to ask her was, why, if she thinks that is okay for her constituents, is she seeking to deny it to ours? That is not an acceptable position for her to take.
Mrs Villiers
Obviously, I do not want to go back over the whole debate we had on this, but there is a range of ways in which the bus sector is very different in London, not least the fact that Londoners pay millions of pounds in congestion charges, which support the bus network. That is one of the major reasons why bus services in London are different from those in the rest of the country; it is not necessarily the regulatory structure that makes the difference.
Andy Burnham
That is, if I am honest, the kind of London-centric argument that gets this House a bad name—“London’s different and therefore it needs different rules and all the extra attention.” If the system works in London, why can it not work in a city region like the west midlands, Merseyside or, indeed, Greater Manchester? If the principles are good ones that deliver a good bus service for people here, then surely they should be extended to the other major cities of our country, and those decisions should be devolved.
If I am to be in a position to use the powers in this Bill, I would use them to bring fares down. Fares are much more expensive in Greater Manchester than they are in London, for instance. I would use them to increase and improve disability access, including audio-visual provision. I would use them to pave the way for an integrated ticketing system. We are currently denied an Oyster-style system. Because of the free-for-all, all the operators use different ticketing systems and cannot provide an integrated system. I would use the powers to give every community a decent, reliable service. I would use them to introduce a free bus pass for all 16 to 18-year-olds.
Ian Mearns
Will my right hon. Friend muse for a moment on why companies are making twice as much profit on routes that they operate in places like Tyne and Wear and Greater Manchester than on routes that they operate in London? They are the same companies, but the operating profit on the routes that they run in those two places is twice as much as it is in London.
Andy Burnham
It is simple, is it not? We have, in effect, an unregulated system, and because of that companies are able to increase fares outside London faster than they have been increasing in London. That is how they make those profits. There are good bus operators out there, and I would not want to punish them. I have a smaller operator, Jim Stones Coaches, in my constituency —a brilliant bus operator. We would want those good operators to be part of the new regime. It is time to call time on the profiteering off the backs of the travelling public in places like Greater Manchester.
The decline in quality and the rise in the cost of bus travel in places like Greater Manchester has, over the 32 years since buses were deregulated, put more and more cars on the roads, to the point where conurbations like Greater Manchester are becoming increasingly congested. As I said earlier, it is cheaper for young people in some parts of Greater Manchester to get a taxi than to use a bus service. That cannot possibly make sense. It tells us that something is seriously wrong with the way that the system is operating. I say to the right hon. Member for Chipping Barnet that the people of Greater Manchester deserve a bus system as good as London’s, if not better. That is what, using this Bill, we will now seek to deliver.
Question put and agreed to.
Bill accordingly read the Third time and passed, with amendments.
Alison Thewliss (Glasgow Central) (SNP)
On a point of order, Mr Deputy Speaker. On Monday last week I asked for an emergency debate under Standing Order No. 24. I do not seek to reapply for that debate, but last week Mr Speaker said that he would
“hope and anticipate that the usual channels would find time for it to be debated.”—[Official Report, 20 March 2017; Vol. 623, c. 655.]
Business collapsed at 4.35 pm last Tuesday and it is finishing at 7.43 pm tonight. This is completely illogical to me and to everybody else watching elsewhere. Can you advise on how I could get a debate on the significant concerns that I still have about the Tories’ two-child policy and rape clause before it is implemented in 10 days’ time? If now is not the time, when is?
Mr Deputy Speaker (Mr Lindsay Hoyle)
That is not a matter for the Chair but it is a matter for the Government. The main thing is that it is definitely on the record, and I would hope that the usual channels would have picked up on the comments that have been made.
Business without Debate
Delegated Legislation
Mr Deputy Speaker (Mr Lindsay Hoyle)
With the leave of the House, we shall take motions 2 to 7 together.
Motion made, and Question put forthwith (Standing Order No. 118(6))
Employment and Training
That the draft Industrial Training Levy (Engineering Construction Industry Training Board) Order 2017, which was laid before this House on 23 February, be approved.
Immigration
That the draft Immigration Skills Charge Regulations 2017, which were laid before this House on 20 February, be approved.
Mental Capacity
That the draft Public Guardian (Fees, etc.) (Amendment) Regulations 2017, which were laid before this House on 9 February, be approved.
Employment
That the draft Prescribed Persons (Reports on Disclosures of Information) Regulations 2017, which were laid before this House on 20 February, be approved.
Electricity
That the draft Electricity and Gas (Energy Company Obligation) (Amendment) Order 2017, which was laid before this House on 8 February, be approved.
Capital Gains Tax
That the draft Enactment of Extra-Statutory Concessions Order 2017, which was laid before this House on 6 February, be approved.—(Mr Syms.)
Question agreed to.
European Union Documents
Motion made, and Question put forthwith (Standing Order No. 119(11)),
Eu-turkey Cooperation on Migration and the Impact on the Schengen Free Movement Area
That this House takes note of European Union Document No. 15429/15, a Commission Communication: Eighth biannual report on the functioning of the Schengen area 1 May-10 December 2015, European Union Document No. 15397/15, a Proposal for a Regulation amending Regulation No. 562/2006 (EC), also known as the Schengen Borders Code, as regards the reinforcement of checks against relevant databases at external borders, European Union Document No. 6798/16 and Addendum, a Commission Communication: Back to Schengen–A Roadmap, European Union Document No. 5985/16, a Council Implementing Decision setting out a Recommendation on addressing the serious deficiencies identified in the 2015 evaluation of the application of the Schengen acquis in the field of management of external borders by Greece, European Union Document No. 7183/16, a Commission Communication: Next operational steps in EU-Turkey cooperation in the field of migration, European Union Document No. 8175/16 and Addendum, a Commission Communication: First Report on the progress made in the implementation of the EU-Turkey Statement; and supports the Government in continuing to work alongside EU partners as part of a comprehensive approach to global migration issues.—(Mr Syms.)
Question agreed to.
Sittings of the House
Tyne Marine Office
(7 years, 1 month ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Mrs Emma Lewell-Buck (South Shields) (Lab)
South Shields has a proud maritime history, present, and, I hope, future. The shipping industry is a major employer in South Shields, its contribution to the industrial and social history of the region being well documented. As one seafarer commented to me, South Shields used to be the centre of the universe for the maritime industry.
The Tyne marine office was previously based at Compass House inside the port of Tyne. It provided seafarers and our local area with a range of vital services, including managing and issuing seafarers’ documentation, and conducting oral exams and eye tests. Our surveyors fulfilled the UK’s legal obligation to conduct port state control inspections of foreign-registered vessels working from our ports in the UK, as well as providing a public counter service for advice and complaints from ship owners, seafarers, and members of the public.
The Maritime and Coastguard Agency’s consultation on the future of the Tyne office stated that it would close by September this year, yet it closed on 6 March, with the lease expiring just a week later—a move that was supported by the Government’s maritime growth study. I accept, of course, that some alternative provision has now been made at South Tyneside College for an initial period of five years, but the move has seen a depletion in crucial parts of the service. Not only was the office closed ahead of schedule, but what is in its place does not, quite frankly, fit the bill. The new office will not have on-site surveyors, nor a counter service. The 18 surveyors have been redeployed in the “flexible, customer-focused” way the Government believe to be an essential strand in their plans for maritime growth. The consultation proposed
“to put in place a remote, IT-enabled working regime to minimise any adverse impact. This would be based around our surveyors working remotely, from other suitable MCA or Government locations or from home.”
This is now in practice. However, can the Minister advise me on when the new IT system for remote working will begin to be used by MCA surveyors? It is important that ports and ship owners in the north-east, but also taxpayers, know how much the IT procurement exercise will cost, in order to balance it against the estimated £330,000 total annual savings that the MCA will make from the marine office closures.
The loss of the Tyne marine office has left a 350-mile stretch of UK coastline between Aberdeen and Bridlington with no physical base for MCA surveyors who are required to inspect and, if necessary, detain a diverse range of UK and internationally registered shipping. Its loss has increased the prospect of the private sector carrying out port state control work at ports where an MCA surveyor may not be available at short notice. This was recognised by some local RMT members in the north-east who made their feelings clear to the Government and to the MCA, stating that
“the closure of the Port of Tyne office and opening an office in Bridlington will open the North East coast to be exploited by shipping companies when inspectors are working from home and do not have a centre to coordinate their inspections and monitor shipping movements along the North East coast.”
In November 2013, a Panama-registered ship called the Donald Duckling was detained in the Tyne by MCA surveyors. This cargo vessel of over 46,000 tonnes was found to be unsafe and crewed by 18 Filipino seafarers who had run out of food. The vessel owners then abandoned the ship and the crew, who were stranded on the vessel, without pay and reliant on international freight transport and our brilliant South Shields Mission to Seafarers and assistance from our port of Tyne to survive. The crew had to wait nearly a year before receiving any pay or safe passage home. Moving MCA survey work away from a physical base may compromise response times when a substandard vessel of concern is in the north-east ports, even if only for a relatively short period.
The other change is the loss of counter service. Marine offices traditionally provide that service to cater for matters such as discharge books, training record books, seamen’s cards and other certification, including duplicates of lost certificates. As our marine office covered Berwick to Whitby, this is a loss not just for my constituents but for the whole north-east and parts of Yorkshire. Seafarers now have to travel to Hull or send their documents by post, all at increased cost and risk. Providing the service is an administrative task, and I am led to believe that the same number of administrative staff are to be retained at the college, so I am completely at a loss as to why the service has been removed, especially when the range of certification required to work at sea is extensive and subject to regular updates.
Just this January, the key convention on standards of training, certification and watchkeeping, which sets out basic requirements for all seafarers, was subject to changes, and the MCA is in the process of reforming its fee structure, including for the basic medical certificate, without which a seafarer cannot work at sea. Marine information notice 541, issued by the MCA earlier this month, states that the Hull marine office will offer a number of services previously provided in the Tyne marine office. The Hull office, which was under threat, is to remain open, but that does not take away the fact that the counter office for seafarers in South Shields and in the north-east will be 100 miles down the coast.
The number of seafarers at work or in training in the UK shipping industry is in long-term decline, with records showing that there has been a 60% decline in the number of merchant seafarers over the last 30 years. We are seeing a decline in offshore supply activity in the North sea following the collapse in oil prices, and there is a constant threat, especially for ratings, of being replaced by low-cost crew from overseas. In that context, I cannot see how the loss of the Tyne marine office will encourage my region to recover jobs and skills in this industry. The Government speak of wanting to recruit and train more British seafarers, but surely taking steps such as the closure of this office and the removal of the counter service will have exactly the opposite effect.
Mr Alan Campbell (Tynemouth) (Lab)
My hon. Friend will be aware of the planned merger between South Tyneside College and TyneMet in my borough. With our history of seamanship and engineering excellence, should we not be encouraging young men and women who seek a career at sea, rather than discouraging them?
Mrs Lewell-Buck
It will come as no surprise that I agree completely with my right hon. Friend. In an era when our seafaring industry is declining, we should be doing everything we can to encourage growth, so I would like the Minister at least to commit today to restoring the counter service in South Shields.
The seafarer projections review published by the Department for Transport in January forecasts big increases in the demand for seafarers from the UK shipping industry over the next decade. If UK ratings and officers are to fill those jobs, the Government have to go beyond the maritime growth study to tackle the effect of the low-cost crewing model in constituencies such as mine. I understand from the maritime unions that the Government are taking encouraging steps on applying the national minimum wage for seafarers. We need significant reforms such as that, not the closure of marine offices, to revive our traditional seafaring communities.
I am pleased that South Tyneside College will retain responsibility for conducting seafarers’ oral exams, because the Tyne marine office conducted the highest number on the national network. Between 2009 and 2016, it carried out nearly 7,700 seafarer oral exams. The total number of UK seafarers working today is just over 23,000, so a significant number will have been through the marine office in my constituency. I sincerely hope that the Minister will be able to offer some assurances that that service will remain firmly in place in South Shields for the long term.
I am a little confused about why, in all those changes, the office has retained the ensign unit, which carries out services for the large or super-yacht sector. I think all my constituents will agree that South Shields is not an area awash with super-yachts. It is, however, awash with seafarers. Can the Minister explain the rationale for keeping that service but not the much-valued counter service that my constituents wanted us to retain?
It is short-sighted to cut the marine office network, particularly in traditional seafaring centres such as South Shields. Marine offices such as that on the Tyne should be seen as assets in an industrial strategy that strengthens the links between maritime communities and seafaring jobs and skills, particularly for women, who remain poorly represented in the seafarer workforce domestically and internationally. The loss of the Tyne office in my constituency will save the MCA only just over £100,000 per year. Its closure tells my constituents that the Government do not value seafarers in the north-east, and I fear that the long-term effects of these changes will far outweigh the short-term and short-sighted financial gain.
Ian Mearns (Gateshead) (Lab)
I will not detain the House for long, but I want to put on record the fact that I agree with every word that my hon. Friend the Member for South Shields (Mrs Lewell-Buck) has just said. The UK maritime workforce continues to diminish, and important skills are being lost to the industry. We must never forget that we are a maritime nation. We seek to increase our trade significantly beyond the confines of the European Union, but we are reducing our protective infrastructure for looking after the interests of UK-based seafarers in a growing international market.
The offshore oil and gas industry along the North sea coast has been in the doldrums, and many ships and vessels are tied up in ports along the north-east. Yet we are losing our regulatory capacity to make sure that the people who work on those vessels are the right people and of the right nationality, and that they have the requisite skills and work permits to do so. I find it beyond belief that the Government are taking the measures that my hon. Friend has talked about in this important Adjournment debate. We need to reverse this retrograde step for an industry that needs the Government to act on its behalf rather than abandoning it.
The Parliamentary Under-Secretary of State for Transport (Andrew Jones)
I start by congratulating the hon. Member for South Shields (Mrs Lewell-Buck) on securing this debate about the closure of the Tyne marine office. The second thing I should do is to offer a bit of an apology, because I am not the maritime Minister. My right hon. Friend the Member for South Holland and The Deepings (Mr Hayes), who has responsibility for maritime, is away on important Government business in China. It may well be that I cannot answer all the hon. Lady’s questions in my speech, but I undertake to go through the entire Hansard report of this debate and take the questions back to the Department to ensure that she receives the answers that she seeks. I wanted to clarify that before we went any further.
Before I talk specifically about the recent closure of the Tyne marine office, it might help the House if I set out some background to the decision. The House will recognise our people’s strong connection to the sea and our impressive maritime heritage. The British have always looked beyond our shores and built strong trade links with the rest of the world. Ships and the related maritime industries have historically been crucial to our economic wellbeing, and that remains as true now as it has ever been. We are an island nation, and the UK relies on shipping for 95% of its trade by volume. Maritime industry directly contributes at least £11 billion to the UK economy each year. Those maritime industries are expected to grow significantly in the next decade, and the public needs the assurance that commercial ships visiting our ports, whether or not they are actually registered in the United Kingdom, are operating safely.
Jim Shannon (Strangford) (DUP)
I apologise to the initiator of the debate, the hon. Member for South Shields (Mrs Lewell-Buck) that, although I rushed to get to the Chamber—I actually ran very fast—I was a wee bit late, for which I also apologise to the House. Does the Minister agree that the closure will undoubtedly compromise the ability of the Maritime and Coastguard Agency survey and inspection unit to carry out its duties and that, although it is difficult to quantify, the impact on local seafarers living and working in the area will certainly be adverse, to say the least?
Andrew Jones
I am not sure I can agree with the hon. Gentleman, but I will come on to discuss that very point later.
Operational safety matters for the sake of the seafarers on ships, and for protecting our cherished and highly prized marine environment. That is why we need a robust, strong and effective ship survey and inspection regime. Within my Department, the Maritime and Coastguard Agency is responsible for providing the broad safety regime. In that effort, the agency and its staff are guided by its mission statement:
“Safer lives, safer ships, cleaner seas”.
The ship survey and inspection regime we have established must be capable of ensuring the safety of the shipping industry, while at the same time being supportive of the industry it serves and commercially attuned to what the industry needs. That view is shared by the industry itself, and it was highlighted in the “Maritime Growth Study” report published in September 2015. Lord Mountevans’s report set out a number of recommendations to support the growth of the whole maritime sector. The Government and the industry have been working tirelessly, in unison, since the report’s launch to put into effect its excellent recommendations.
For the Maritime and Coastguard Agency, we have implemented some of the recommendations by separating the UK ship register into a bespoke, commercially focused directorate. We have appointed Doug Barrow, formerly the chief executive of Maritime London, as the new director of the UK ship register. He has been supporting the MCA on a part-time basis since January, and will take up his appointment full-time on 10 April. Mr Barrow brings with him an expert and forensic understanding of the commercial needs of the shipping industry. The MCA’s leadership has also been bolstered by the appointment of its first non-executive chairman. Michael Parker, who will fill that role, brings with him over 40 years of experience and knowledge. He, too, will support the MCA’s greater commercial awareness and responsiveness, which is critical to what I will come on to talk about shortly.
Another transformational change for the agency, which is linked to balancing its role as a regulator with the need for greater commercial responsiveness—this recommendation was at the heart of the “Maritime Growth Study”—is the modernisation of our ship survey and inspection arrangements. Ship survey and inspection is at the heart of the Government’s responsibilities as both a flag state, running a shipping register, and as a port state, with many ships visiting UK ports and harbours daily. Both roles are about balancing safety and the protection of the environment with facilitating legitimate commercial activity and trade.
The safety of shipping, ports and the marine environment is dependent on effective and proportionate regulation, robust technical standards and the comprehensive oversight and inspection of national and international merchant shipping fleets. Effective survey and inspection is key to compliance, and it must be robust if it is to support the level of growth in the maritime sector envisaged by the “Maritime Growth Study”. Overseeing shipping and protecting the marine environment carries a degree of risk that needs to be properly managed. A failure in regulatory governance by those operating ships could—very sadly, as we all know, it sometimes does—result in serious accidents, with damaging consequences for those involved and for our environment.
The MCA carries out its ship survey and inspection regime for the UK through a frontline cadre of some 130 marine surveyors located around the UK. The marine surveyors are experienced seafarers, many of whom are master mariners, chief engineers or qualified naval architects. The frontline marine surveyors are supported by experienced and equally qualified colleagues working in policy, technical and in-house advisory positions, providing oversight and advice, and monitoring technical and professional standards.
Notwithstanding its strong global reputation for competence and its positive influence on worldwide safety standards, the MCA has struggled in recent years to meet its remit and its ability to discharge its statutory obligations for maritime safety. In part, that has been because it has proved difficult to attract qualified marine surveyors in what is a highly competitive marketplace. The marine surveyor cadre has been operating with some 30% vacancies, and has for the past few years found it very difficult to attract and retain high-quality staff.
Recognising the need for change, the agency carried out a comprehensive review of the way in which it delivers its ship survey and inspection obligations. By listening to the needs of customers and the industry, and by considering the Government’s estate strategy and optimising the potential benefits of technology, the MCA has identified a number of areas where improvements can be made. With the support of the trades unions, new terms and conditions have been agreed for the agency’s frontline marine surveyor workforce. The modernised terms are designed to improve availability, deployability and responsiveness to industry and wider demand, while at the same time retaining and attracting new talent to the workforce.
A key element to the new terms and conditions is the concept of remote working, which is made increasingly possible by modern technology. The hon. Lady asked about new IT systems, and I can tell her that they are already in place. Marine surveyors will no longer be required to work from one of the relatively few marine offices around the UK. They can instead work remotely anywhere, serving a much greater proportion of our customers in and around the UK’s ports.
Mrs Lewell-Buck
Will the Minister share with the House the cost of the new IT programme?
Andrew Jones
I cannot do so, because I do not have that information with me, but I will find out and write to the hon. Lady.
The key is to build on remote working, which is made possible by modern technology, to provide a more customer-oriented service. With frontline marine surveyors based closer to their customers, the MCA can simply respond quickly to customer needs. That ability is a further direct response to an industry that increasingly needs support at all times of the day. The changes address particular industry concern and call for change. That is the background: a more customer focused and responsive sector driven by technology, and the needs of a sector that we wish to see grow.
That brings me to the specific issue of the closure of the Tyne marine office. As part of the overall package of change, the MCA consulted last year with the public and industry on the new proposed estate footprint. Following the consultation, the agency concluded that there should be nine marine offices across the UK. The proposal to close the Tyne marine office was confirmed. The Tyne marine office has played a key role in maritime safety, alongside others, in the north-east for many years. That point was made by the hon. Lady. It is without question. Its close relationship with local industry and with South Tyneside College has seen over 1,000 seafarers, both new and experienced, visit the marine office every year to sit their seafarer examinations.
Recognising that local need, I can inform the House that the same number of marine surveyors will continue to be located in the Tyne area to meet demand. The Tyne marine office has closed, but the MCA has opened a bespoke examination facility in the area to respond to the needs of the customers and industry. The new examination centre, which has MCA branding, is situated within South Tyneside College. As I am sure the hon. Lady is aware, it opened on 13 March 2017. The MCA’s commercial large yacht unit, known as Ensign, will operate from the same examination centre. It might not be a venue for that many super yachts, but it is a venue for expertise within the MCA. That is why the unit was there in the first place. Remote working marine surveyors based in the Tyne area will be able to use the facility as a remote office when required.
The hon. Lady raised concerns about there no longer being a counter service on the Tyne. There is no longer a counter service, but I would highlight that the MCA still has in place service provisions to provide documents, such as discharge books and seamen’s cards, in line with other Government services. Applications for these documents can be made online or via the post. It is worth noting that over the past two years, there have been approximately two visits per week to the Tyne counter. That is in contrast to the 1,200 exams and over 100 port state control inspections per year. The provision of a counter service fails to take into account the direction of technology, the lack of demand and the need to consider providing services in a way required by customers.
Mrs Lewell-Buck
I thank the Minister for giving way again. He is being very kind. I am aware of the figure of two people a week going to get papers and documentation, but does the Minister have figures for how many people came into the office for help, advice or discussions about future careers? That service mattered to my constituents and they would want it to be brought back.
Andrew Jones
I can pick up that point, along with some of the other points raised. The need to have a presence in the area is understood, with the link to, and the base at, South Tyneside College, which will deliver 1,200 oral exams and over 100 port state control inspections a year. It is important to emphasise that the MCA and its excellent marine surveyors have not in any way abandoned the north-east of England. They are still very much there. They are talking about the same number of people providing the same services. They will be supporting their local customers. What we are trying to do is deliver that service in a way that is more responsive to customer need. That is the feedback from industry. We need to make our service more attuned to its needs, so we no longer continue to see maritime decline. They are just working differently and from a different base at the South Tyneside College.
This was the first step in a national restructure intended to secure a robust survey and inspection regime that aims to deliver a more efficient service. It is a service that can meet the needs of customers and industry. It is a modernised service that will help to attract new ships to fly the flag and join the UK ship register. I can assure the House that our modernised ship survey and inspection arrangements will mean that we retain our place as one of the most respected maritime nations in the world.
Question put and agreed to.