Trusts (Capital and Income) Act 2013

Chris Grayling Excerpts

Tuesday 8th October 2013 Written Statements

[The Lord Chancellor and Secretary of State for Justice (Chris Grayling)]

In a written ministerial statement of 14 March 2013, Official Report, column 27WS, my hon. Friend the then Parliamentary Under-Secretary of State, the Member for Maidstone and The Weald (Mrs Grant) announced that she had made the Trusts (Capital and Income) Act 2013 (Commencement No. l) Order 2013. This order brought the following provisions of the Trusts (Capital and Income) Act 2013 into force on the dates specified: (a) sections 1 to 3 (inclusive) on 1 October 2013; and (b) for the purpose only of exercising the power to make regulations in accordance with section 104B of the Charities Act 2011 as inserted by that provision, section 4 on 6 April 2013.

My hon. Friend also said in the same statement that she would make a further announcement about the commencement of the remainder of section 4, which specifies when and how charities may adopt total return investment, following the completion of a consultation by the Charity Commission on the content of the regulations to be made under the new section 104B.

The Charity Commission has now completed the consultation and intends to bring the regulations into force on 1 January 2014. The Trusts (Capital and Income) Act 2013 (Commencement No.2) Order 2013 has therefore been made, which will bring section 4 fully in force on 1 January 2014.

As a result of the making of this order the whole of the Trusts (Capital and Income) Act 2013 will be in force from and including 1 January 2014.

Hague Convention (Austria and Malta Accession)

Chris Grayling Excerpts

Friday 13th September 2013 Written Statements

[The Lord Chancellor and Secretary of State for Justice (Chris Grayling)]

The Government have decided to opt in to the proposed Council decision authorising Austria and Malta to accede to the 1965 Hague convention on the service abroad of judicial and extra-judicial documents in civil or commercial matters.

The convention is designed to provide a simple, speedy and cost-effective process for the transmission of legal documents between the courts and individuals of contracting member states to the convention. It brings greater legal certainty, and improves protection for the interests of defendants involved in international civil or commercial litigation. While the accession of Austria and Malta will have no direct effect on the United Kingdom as service of documents within the EU is governed by an EU regulation, the Government welcome the accession of Austria and Malta to the convention and notes the benefits this will bring to the Crown dependencies and overseas territories who are also parties to this convention.

Although not anticipated in the proposal, the Government believe that the UK opt in under the protocol to title V of the treaty on the functioning of the European Union applies and it has therefore asserted its right to choose whether to opt in; they have decided it is in the UK’s best interests to do so. The Government have taken this decision notwithstanding the fact that they dispute the Commission’s claim to “exclusive” competence.



The Government believe that the wider significance of these proposals for external competence mean that it is in the UK’s interests to participate fully in future negotiations on this proposal, including having the ability to vote.

Judicial Review

Chris Grayling Excerpts

Friday 6th September 2013 Written Statements

[The Lord Chancellor and Secretary of State for Justice (Chris Grayling)]

I will today lay and publish the paper “Judicial Review: further proposals for reform” (Cm 8703) which seeks views on potential areas for the reform of judicial review and related issues, including legal aid.

Reforming judicial review is an important part of the Government’s programme to tackle public burdens, promote growth and stimulate economic recovery. I am clear that judicial review is, and will remain, an important means to hold Government to account where it is acting unlawfully, but I remain concerned that too often it is being used either as a campaign tool or to delay or frustrate decisions that have been properly made. I am also concerned that legal aid resources should be targeted at those judicial review cases where they are needed most if the legal aid system is to command public confidence and credibility.

A number of reforms have already been made to the procedural aspects of judicial review, including removing the right to an oral renewal in a case certified by the judge as “totally without merit” and aligning the time limits for bringing a planning or procurement judicial review with the relevant statutory challenges. A new fee will soon be introduced for an oral renewal. While these reforms are a worthwhile first step, it is right that we test the potential for further substantive reform.

To that end, the paper makes proposals in a number of areas: the courts’ approach to cases which rely on minor procedural defects; rebalancing financial incentives; speeding up appeals to the Supreme Court in a small number of nationally significant cases, which would extend beyond judicial review; and planning challenges. I also think it makes sense to explore the potential for reforming the test as to who can bring a judicial review, as well as whether there are mechanisms other than judicial review for resolving disputes related to the public sector equality duty, following a recommendation by the Public Sector Equalities Steering Group.

Having listened to concerns raised in the Transforming Legal Aid consultation, which closed in June, this package also includes a proposal in relation to the payment of legal aid providers in judicial review cases. In addition to our original proposal that providers would only be guaranteed payment for their work on a judicial review where permission is granted by the Court, this consultation proposes that the Legal Aid Agency will have a discretion to pay providers in certain genuinely meritorious cases where the provider has been unable to secure a costs order or costs agreement as part of a settlement.

The proposals I am publishing today are intended to deliver a much needed rebalancing of judicial review so that it operates in a more proportionate manner without undermining how Government are held to account, allowing scarce taxpayer-funded resources to be focused where they should be. The consultation will close on 1 November, and all responses will be considered carefully before I respond.

Transforming Legal Aid

Chris Grayling Excerpts

Thursday 5th September 2013 Written Statements

[The Lord Chancellor and Secretary of State for Justice (Chris Grayling)]

I am today publishing the Government response to the consultation paper “Transforming Legal Aid: Delivering a More Credible and Efficient System”, published on 9 April this year as well as further consultation on some revised proposals. Copies of “Transforming Legal Aid: Next Steps” will be placed in the Library and will be available in the Vote Office and Printed Paper Office.

I will make an oral statement to the House on this matter later today.

Transforming Legal Aid

Chris Grayling Excerpts

Thursday 5th September 2013 Commons Chamber

[The Lord Chancellor and Secretary of State for Justice (Chris Grayling)]

With permission, Mr Speaker, I would like to make a statement about the future of criminal legal aid in England and Wales.

As the House knows, this Government have embarked upon a process of repairing the public finances, after years of reckless borrowing and financial crisis under Labour. As my right hon. Friend the Chancellor explained at the spending review in June, we are making good progress, but we must continue to take the tough decisions necessary. No area of our spending has been immune from scrutiny. Our legal aid system is a major part of my Department’s budget, and it is therefore necessary that we look to make savings there, too. The Ministry of Justice will see its budget reduced by nearly a third between 2010 and 2016. Our reforms would see the legal aid fund reduced by the same order of magnitude. It is worth saying that we have one of the most expensive legal aid systems in the world and that, by comparison with similar jurisdictions elsewhere, we spend between two and three times as much per head of population on legal aid. That is simply not sustainable for the future.

The House will remember that I set out our initial proposals to meet those challenges in April. In doing so, I emphasised two important objectives. The first was to ensure that we could live within our means and still deliver a quality legal service to those who need legal aid. The second was to guarantee access to justice by creating a firm contractual framework for criminal legal aid. That would enable us to ensure that we retain legal aid-funded legal support in all parts of the country, provided by organisations that will be financially sustainable in a tougher funding climate.

After publishing our initial proposals in April, we have undertaken intensive negotiations with the Law Society, which represents legal aid solicitors, who are the most affected by our proposals on criminal legal aid contracting. I am pleased to tell the House that we have reached agreement with the Law Society on a package of revised proposals on criminal legal aid contracting, which we are publishing for consultation today, and a copy has been deposited in the Library. I would like to express my thanks to the Law Society team for the constructive way in which they have approached a set of negotiations that I believe have led to a good deal for this country.

The proposals will mean that all those accused of a crime receive high quality legal representation, that defendants are free to choose their lawyer, whether they want a big firm, their local high street solicitor or a particular specialist, and that all those who currently provide criminal legal aid services can continue to do so, provided they meet minimum quality standards. However, I have to ensure that every person arrested and put in a police cell has access to a lawyer. In future, therefore, duty slots will be allocated through a tight contracting mechanism, based on quality and capacity to ensure that only firms or groups of firms that demonstrate clearly that they have the financial strength to operate in this new, tighter financial environment will provide that guaranteed support in police stations.

The financial situation that this Government face means that fee reductions are inevitable. However, I have agreed to phase these between early 2014 and the spring of 2015, in line with a new timetable for contracting, so that firms have time to prepare and adjust. It is important to note that these proposals will enable my Department to operate within our spending review settlement, and therefore represent a long-term and sustainable way forward for the Government and for the profession. This is a good deal for the country and for the taxpayer. In addition, in order to reduce financial pressures on legal aid lawyers, I plan to make staged payments more readily available, to improve their cash flows.

In order to meet our financial objectives for Crown court costs, I am putting forward for consideration two options on advocacy fees. One builds on the proposals we put forward in April, but sets a floor below which fees cannot go, and recognises that there should be a different fee for guilty pleas and trials. The other is based on a scheme put forward in discussions between us and the Bar Council, and I am grateful to the Bar Council for that proposal. It draws on the scheme used by the Crown Prosecution Service. Both schemes represent a sensible way to reduce fees, particularly for the highest earners, as well as speeding up and simplifying the administration of the legal aid system. We will be guided by the views of the profession and other stakeholders in reaching a final decision on which scheme to implement.

It is also clear to me, particularly following the consultation that we have carried out, that it is not simply legal aid funding arrangements that determine the success and viability of the legal professions. I am therefore taking a series of steps that will demonstrate that the Government are serious about maintaining the legal profession in this country as a world leader. We have to go further to ensure that the criminal justice system is more efficient, so that cases do not demand more time and resources than necessary, in terms of public money and of the individual commitment by the lawyers involved. Alongside the criminal justice action plan announced by the Minister for Policing and Criminal Justice earlier this year, we are therefore putting together a panel of criminal lawyers to look at the whole legal process, to identify scope for improvements and to draw up proposals for reform. We need to speed things up and to reduce work loads.

It is also clear that advocacy is facing an uncertain future, given the rise of different routes into the profession, increasing supply but decreasing demand, regulatory changes and financial challenges. I have therefore asked Sir Bill Jeffrey to conduct an independent review of the future of criminal advocacy in England and Wales. This review will be carried out in partnership with the Law Society and the Bar Council.

Our initial proposals in April also set out a number of other changes to legal aid, in order to ensure public confidence in the system. I now plan to go ahead with most of those, subject to a number of limited modifications and exceptions. In particular, we will introduce a new residency test that will prevent most people who have only just arrived in the UK from accessing civil legal aid until a year after they arrive. We will limit criminal legal aid for prisoners so that it is not available unnecessarily. There will be no more legal aid available because someone does not like their prison. We will also set out new rules that will mean that, in most cases, the wealthiest Crown court defendants—those in households with more than £3,000 of disposable income left each month after tax, housing costs and other essential outgoings—will have to fund their own legal costs.

When I set out our initial plans in April, I was clear that they were for consultation. I have kept that promise. I believe that what we have agreed with the Law Society on criminal legal aid contracting is a sensible revised proposal that is tough but realistic. I shall be interested to hear whether the Opposition support the agreement. I do not deny that some of the proposals will be challenging for many, but in the context of unavoidable spending restraint, I have worked with representatives from the solicitors’ profession and the Bar to achieve the best outcome for everyone. I believe that it offers value for the taxpayer, stability for the professions, and access to justice for all. I commend this statement to the House.

[Sadiq Khan (Tooting) (Lab)]

I shall start by thanking the current Lord Chancellor for giving me advance sight of his oral statement just over an hour ago. However, I am still somewhat puzzled as to why today’s edition of The Times was considered a more important outlet for the public announcement of this climbdown than the proper place for such an announcement, which is here in Parliament. Can the media-shy Lord Chancellor explain that rather odd decision to the House?

Let me reiterate Labour’s position. We support efforts to find savings across our criminal justice system. We support making those who can afford to pay their legal fees to do so and restricting legal aid to those truly most in need. We also support using the frozen assets of criminals to fund their legal costs, and we want a more efficient system. We offered months ago to work with the Justice Secretary, but he arrogantly refused, although I note that he has taken on board many of our concerns, which we welcome, and adopted our idea of having a review and asking experts to look at the legal processes to see whether further positive reforms can be made. Will he please give the House more details of this review?

Today’s statement provides confirmation that the Justice Secretary’s plans—and they were his plans—really were half-baked, legally illiterate nonsense. He has been forced to climb down, and the sloppy way in which he goes about making policy has been exposed by experts in the field—from judges to rape victims, and from high street solicitors to the victims of miscarriages of justice, who really know what they are talking about.

This Justice Secretary was warned—by us and others—that his plans would see the destruction of a swathe of legal small and medium-sized enterprises across the country, yet he denied that it would happen. He was warned that the removal of client choice would undermine confidence in our legal system; he denied it. He was warned that a flat fee would put pressure on the innocent to plead guilty; he refused to accept that, either. Does he now agree with all those criticisms of his original proposals?

This is the first time that the Justice Secretary has participated on a debate in this Chamber on legal aid, so I have a number of further questions for him. Will he confirm that the 16,000 representations that the Ministry of Justice received about his plans is a record? I note, of course, that the Justice Secretary has made a deal with the trade union for solicitors, the Law Society, which we welcome. Does the Law Society fully accept the plans he has published today? Does he still stand by his previous public criticism of the barristers’ trade union, the Bar Council? What discussions has he had with it about these plans? Will he confirm that his latest plans still lead to a single fee for magistrates courts’ work, regardless of whether the case is a guilty plea or a trial? The right hon. Gentleman will be aware that this could lead to a perverse incentive to persuade a defendant to plead guilty when he or she is not guilty. Given that the Government have changed their mind on this issue for Crown courts, why not for magistrates courts, too?

The Justice Secretary will be aware that small and medium-sized firms undertaking legal aid work are already struggling to survive. There is a real concern about their future viability after a 17.5% cut in their fees. In that light, will the right hon. Gentleman tell us about the impact assessments he has done on his latest plans? What will be their impact on high street firms, on junior barristers, on black, Asian and minority ethnic solicitors and barristers, and on access to solicitors across the country, particularly in rural areas?

Will the right hon. Gentleman tell us what changes he has made to his plans for civil legal aid and judicial review, bearing in mind the many concerns raised across the House about them? He should now be aware that his plans for civil legal aid would have prevented the Gurkhas and the family of Jean Charles de Menezes from getting legal aid, while his plans for judicial review would create a perverse incentive for lawyers not to settle cases because they will need to get permission at a court hearing to recover costs. How is he going to address those concerns?

I am pleased that the Justice Secretary used his summer to swot up on the law and the justice system. I am glad that the primer worked. I am pleased that he appears finally to have seen sense and to have listened to those who know better. We will study the new plans closely, and consider the 270-page document published by him today. The public want confidence that the rule of law is being preserved, that access to justice is being maintained and that those truly guilty are being prosecuted and punished after due process. The justice system needs to be both credible and efficient. These are the tests we will continue to use in looking at the Government’s plans to reform legal aid.

[Chris Grayling]

The Opposition are obviously finding all this rather difficult, because they agree that we have done the right thing. It is clear to me that the days of beer and sandwiches are long gone, because the Labour party has forgotten how a negotiation works. It works like this: you put forward proposals, you listen to a representation from the other side, you engage in a negotiation, and you reach a settlement. That is what we have done, and this is a good settlement for Britain. It enables us to meet our spending review targets, which is what the country would expect. What the Opposition do not like is the fact that we have done the right thing and arrived at the right objective—and we should remember that they never consulted on anything when they were in government.

The right hon. Member for Tooting (Sadiq Khan) asked me about this yesterday. I should point out that I took the unusual step of briefing the Opposition on our plans 24 hours rather than one hour in advance, because I recognised the importance of talking to the legal profession, whose members are personally affected by this change. I have tried to balance the interests of the House with those who are most personally and individually affected. That is why I shared the information with the right hon. Gentleman well in advance of any norm in the House.

The right hon. Gentleman referred to the concept of debates in the House. I seem to remember his telling the House that he would use a Labour Opposition day to debate this issue, because it was crucial, and the next Opposition day debate would be about legal aid. That never happened, because, in fact, the Labour party does not take this issue seriously at all.

The right hon. Gentleman mentioned magistrates courts, but, as he will know, our proposals were always about Crown courts. He asked about our discussions with the Bar Council. I have had many meetings with the Bar Council and the circuit leaders over the last few months. One of the two options that we have presented today was suggested to me by the circuit leaders and echoed by the Bar Council, namely the option of replicating more closely the way in which the Crown Prosecution Service works. I have received valuable support in relation to all this from the Attorney-General and the Solicitor-General, and I hope that those two options will provide a basis for a clear discussion about the best way forward.

The right hon. Gentleman made a point about small and medium-sized enterprises. The Law Society and I are clear about the fact that we expect these changes to lead to amalgamations in the SME sector. Legal aid services are currently delivered by 1,600 firms, many of which are very small. We will continue to allow those firms to carry out their own client work, but what is most important is that I provide access to justice—to which the right hon. Gentleman referred—in every part of the country. That requires me to be sure that I have firms that are financially sustainable in every part of the country, which is why we need the contracting mechanism that I am going to introduce. It is essential to ensure that there is access to justice, and that is a key part of these proposals.

Finally, the right hon. Gentleman mentioned judicial review. We intend to produce a consultation document on changes to judicial review imminently.

[Sir Edward Garnier (Harborough) (Con)]

As the Lord Chancellor will know, I am a member of the Bar but have no personal interest in legal aid matters.

The Lord Chancellor said that he would propose a floor below which the fees of lawyers dealing with criminal cases could not fall. Is he hopeful that his proposals will not lead to a flight of the best from the criminal Bar and the solicitors’ profession, so that we find that we are not developing the senior barristers and solicitors who go on to become Crown court judges? I am concerned about what will happen to our criminal justice system in future if we do not have the experts—the top professionals—to deal with the most difficult criminal cases.

[Chris Grayling]

We have modified the tapering arrangements so that the least that a junior barrister can be paid for a day in a Crown court trial is £225 plus VAT. We all want talent to be maintained in the Bar. One of the reasons that, together with the Law Society and the Bar Council, we invited Sir Bill Jeffrey to head a review of advocacy was our wish to secure a proper strategy for the future. We are arguably training more barristers today than there are places for them. The balance of the profession and the number of people in the criminal Bar are important issues, and I want someone who is independent, and working in partnership with the two sides of the profession, to establish the best way for advocacy to evolve, precisely so that what my hon. and learned Friend has described does not come about.

[Kevin Brennan (Cardiff West) (Lab)]

Only yesterday we saw how a miscarriage of justice can take place, and how someone—in this case, Barri White—can spend many years in prison for crimes he did not commit. Can the Justice Secretary give the House an absolute assurance that none of his proposals could result in further such miscarriages of justice?

[Chris Grayling]

The key to ensuring there is no miscarriage of justice is to make sure someone is properly legally represented. None of the proposals we have put forward have ever done anything to undermine the principle that in a trial somebody should have a properly qualified advocate of their choice to represent them, and that we must make sure that we have state of the art police and prosecution services—and my right hon. and learned Friend the Attorney-General is working hard to make sure we have a prosecution service that is as state of the art as possible. It is, of course, essential that we do everything we can to make sure there are no miscarriages of justice. Nothing in these proposals should mean that miscarriages of justice are more likely.

[Mr David Davis (Haltemprice and Howden) (Con)]

I welcome unreservedly the Justice Secretary’s response to the House’s concerns about the criminal justice system. What he has done in that regard has been excellent. However, I and other Members still have concerns about some of the proposals that have constitutional implications—judicial review, the residency test and so on. The Joint Committee on Human Rights is reviewing the Justice Secretary’s proposals. Will he wait until it reports before implementing the proposals with constitutional implications?

[Chris Grayling]

The JCHR wrote to me to ask about the timetable, but we tabled our proposals back in April and made it pretty clear what the timetable will be. Of course I will talk to that Committee, but we need to make progress on the financial side. We will shortly be carrying out a further consultation on judicial review matters. I am open to listening to all Members of the House on those elements we are consulting on, and those that require legislation will be fully debated in this House.

[Natascha Engel (North East Derbyshire) (Lab)]

The legal aid budget comprises criminal legal aid and civil legal aid. What proportion of the budget goes on civil legal aid?

[Chris Grayling]

By the time all the changes we have introduced reach a steady-state point, the ratio will be roughly 50:50.

[Simon Hughes (Bermondsey and Old Southwark) (LD)]

May I declare my interest as a lawyer and a member of the JCHR? I should also mention that I submitted a response to the consultation with some criticisms of the original proposals. I pay tribute to the Secretary of State for listening to the Committee responses and for responding, and also for producing a second consultation paper to which people can respond. It seems that the threat to the high-street lawyer and the specialist firm has been lifted, which is welcome, and also that the Secretary of State understands there are still savings to be made in time and cost in the legal system, which remain a scandal. However, may I just ask him to undertake to the House that the poor, those with special needs, the young, those who do not have English as a first language and those who may not be resident here normally but who have human rights issues of national and international importance will still have a legal system they can turn to in their hour of need?

[Chris Grayling]

I can give my right hon. Friend that assurance. I have listened to the representations made to me by members of the JCHR and privately by members of the judiciary about some of the more specialist situations—where people have been trafficked, where there is a child aged under 12 months, and other similar cases—and we have sought to identify cases where there are individual special needs that need to be met. That is reflected in the proposed changes—to the residence test, for example. When my right hon. Friend reads the detail of what we are proposing, I hope he will see that we have made modifications designed to reflect the concerns he and others have raised.

[Karl Turner (Kingston upon Hull East) (Lab)]

I cautiously welcome the Lord Chancellor’s U-turn on price competitive tendering, but the devil is in the detail and I still have some reservations that this might well be PCT through the back door. What will be the criteria for obtaining a duty contract? Will it be about price or quality of service?

[Chris Grayling]

As I said in my statement, it will be based on quality and capacity. What has always mattered to me is that we can guarantee coverage around the country, but without some form of contractual mechanism to ensure we secure the supply of duty legal aid services at the very least, we will always risk the availability of a law firm that does legal aid in a particular area being at the whim of the market. I think that this set of compromise proposals will deliver the certainty we need, and that it will do so in a way that is much more acceptable to the legal profession. I am delighted that we have worked together with the legal profession to reach a point on which I think we can all agree and that is good for the country.

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

Do the changes have any implications for the military justice system, given the continuing concern both in this House and the country at the huge costs bill faced by the courageous SAS Sergeant Danny Nightingale as a result of trying to defend himself against an inappropriate prison term?

[Chris Grayling]

I obviously cannot comment about that specific case, but I am not aware of anything in these proposals that would have a detrimental effect on the very important processes we have in place to deal with military matters. It will be very much on my mind in the coming months to take a closer look at the whole issue of veterans and armed forces personnel and the legal profession, because I am not entirely convinced we do enough to make sure we recognise the needs of those leaving our armed forces who end up in the criminal justice system.

[Valerie Vaz (Walsall South) (Lab)]

I am a non-practising solicitor. Of the 16,000 responses to the Justice Secretary’s original consultation, how many were in favour of those earlier proposals?

[Chris Grayling]

Of the 16,000 we received, the vast majority were single-template campaigns. We have not sought to add up pros and cons. What we have done is looked at the consultation responses in detail, and looked for sensible ideas. We have had constructive discussions with the professions who provided the most substantial responses, and we have brought forward what I think are the right proposals for the future.

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

I refer to my declaration in the Register of Members’ Financial Interests. I thank my right hon. Friend for listening to the weight of opinion in particular relating to PCT and the need for quality representation at the police station. In the review of criminal process, will he make sure the rules relating to disclosure of criminal evidence are looked at very carefully, as it seems to me that considerable savings can be made, particularly in very high-cost cases?

[Chris Grayling]

I can certainly do that. I give my hon. Friend the assurance that when Sir Bill begins his work, I will pass those comments on to him. On PCT, it is worth reminding the House that the Labour party first came up with the idea.

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

Rather than a compromise, this is a complete climbdown, which prompts the question of who the Secretary of State spoke to before formulating his original proposals. The devil is in the detail. Will the Secretary of State say whether he is also reviewing what minimum quality standards will apply in this new contractual arrangement he highlights?

[Chris Grayling]

On the first point, I know the Labour party would like to portray this as some great climbdown, but the reality is that there has been a process of consultation and negotiation. That is how we reach good agreement. I know that Labour Members never did that in government, because they do not know how to consult, negotiate and agree, but that is what we have done and we have come up with the best deal for this country.

On the latter point, we believe this is being taken forward in the right way. I know the hon. Lady wants to look at the detail. The documents are available in the House, and if she has any further questions, we will respond in detail.

[Charles Hendry (Wealden) (Con)]

I have a constituent whose children were illegally abducted by his ex-wife. In the court case to have them returned, his ex-wife had all her legal costs covered by legal aid, but my constituent as the innocent party incurred legal costs of over £140,000. Do the proposals include measures to address that sort of unfair and unbalanced situation?

[Chris Grayling]

I entirely understand the concerns my hon. Friend raises. I obviously cannot comment on the specific case, but what I can say is that within our legal aid system both now and in the future discretionary funding will be available for the unexpected and unusual case that might not conform to the central rules of the scheme but where there is a clear need for support to be provided.

[Steve McCabe (Birmingham, Selly Oak) (Lab)]

Can the Justice Secretary assure us that there is no connection between the original opposition to his proposals from Churches, charities and advocacy groups and the Government’s subsequent efforts to muzzle those organisations through the lobbying Bill?

[Chris Grayling]

That is a pretty absurd question, to which the answer is that that is complete nonsense.

[David Mowat (Warrington South) (Con)]

For the avoidance of doubt, will the Secretary of State confirm that the absolute level of savings implied in today’s statement is similar to that in the initial consultation and that we will be moving our costs in this area to a similar level as that in other countries?

[Chris Grayling]

I can give my hon. Friend an absolute assurance on that. In my very first contribution to this debate I said that I have to achieve the financial savings set out in our spending review settlement. I am not wedded to any exact way of doing so; if somebody has a better idea, I am happy to look very closely at it. That is what I have done, and this is the agreement we have reached, and it is just a shame that the Opposition do not understand that.

[Sir Tony Baldry (Banbury) (Con)]

First, may I declare an interest as a practising member of the Bar? Does my right hon. Friend agree that it is not sustainable in the long term if some legally aided members of the Bar are earning substantially more than the Lord Chief Justice or the Prime Minister? One simply cannot continue to have such a system.

[Chris Grayling]

My hon. Friend is right; we have focused the majority of our changes relating to the Bar on those at the upper end of the income scale. I know that this is difficult and that these are painful decisions for some people, but there will be a limit to what we can afford to pay someone who is living off public funds entirely or almost entirely.

[Paul Blomfield (Sheffield Central) (Lab)]

While welcoming the Justice Secretary’s statement, made in the face of the enormous opposition that his original proposals generated, may I press him further on one of the earlier answers he gave? Will his new proposals still mean that not only trafficked people, but separated children, survivors of domestic violence, detainees and children under 12 months will have reduced eligibility for legal aid?

[Chris Grayling]

We have made exceptions to that test with our modifications relating to the residency test, particularly for very young children and victims of domestic violence and of trafficking, and in one or two other cases where we have international obligations, but the vast majority of people who come to this country have to expect to be here for a while before they can access civil legal aid. That is right and proper, and it is what the public would expect.

[Sarah Teather (Brent Central) (LD)]

From a quick scan of the consultation document, and further to the Lord Chancellor’s answer to the hon. Member for Sheffield Central (Paul Blomfield), it looks as though the Government have made substantial moves on categories of the vulnerable, which I welcome. However, the Lord Chancellor has not answered a point that a number of other Members have raised: what would happen with cases such as those of Baha Mousa, Binyam Mohamed and the Gurkhas? Will he confirm whether there is any exception for such important international cases?

[Chris Grayling]

Of course, cases such as the one raised regarding an inquest are covered separately. If the hon. Lady will forgive me, I am happy to give hon. Members responses to specific detailed questions, but I am not going to try in this Chamber to apply the new rules to individual cases. I do not think that would be the right thing to do.

[Debbie Abrahams (Oldham East and Saddleworth) (Lab)]

The comment the Minister made about access to criminal legal aid for prisoners was inappropriate for somebody holding his office. Will the seriousness of a case or its merits be taken into account when people who have not been resident for 12 months are trying to access legal aid?

[Chris Grayling]

What we have done is set aside a certain number of areas of special case eligibility. The point about prisoners may be a point of difference between the hon. Lady and me, but we have a prison complaints system and a prison ombudsman, and I do not believe we should also provide public funding for people to go to court because they want to be transferred to a different prison. I think that the overwhelming majority of the public would be with me, rather than with her, on that.

[Mr Andrew Turner (Isle of Wight) (Con)]

I listened with interest to the Lord Chancellor’s statement. How will his announcements affect access to legal aid for my constituents and on the Isle of Wight?

--- Later in debate ---

[Chris Grayling]

I have listened carefully to comments that my hon. Friend has made. With the detail of the contracting, we will have more contracting areas. However, the rules we have put in place will mean that local firms on the Isle of Wight will be able to continue to provide own-client work, so there is no reason why there should not still be a good service for people on the Isle of Wight who need it. Of course, through the contracting mechanism for duty slots, we will have guarantees that duty solicitors will be available in police stations on the Isle of Wight, regardless of other circumstances.

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

I congratulate my right hon. Friend, both on his statement and on the sensible and careful way in which he has approached this issue. The statement will deliver fair access to justice for my constituents, while also making the necessary savings. Will he confirm that the savings being made will not be taken from other areas within his Department, that they are an overall saving and that it is still the same as originally proposed?

[Chris Grayling]

That is a very important matter. As the House knows, I have to make some substantial cuts across the Department. I am trying to balance them sensibly and to deliver them through reforms. What this package does is enable me, in a different way, to get to the same point financially. I am grateful to those who have been involved in the negotiations for the constructive way in which they have approached this. I know it is difficult and that it will be very unwelcome to many people in the profession, but it is the best option we have available.

[Neil Parish (Tiverton and Honiton) (Con)]

I welcome the fact that the Secretary of State has listened to the consultation. Devon and Cornwall were going to be treated as one area for competitive tendering, but it was just too huge. Local companies and specialist companies in my constituency and area will get a chance to deal with the work, and I am happy that he can give us that reassurance.

[Chris Grayling]

Absolutely. As I say, it was a genuine consultation and a genuine process of discussion. I was impressed by comments made by my hon. Friend, and by colleagues in similar constituencies, about our having to do more to try to address the issues in rural areas, and that was something I tried to take into account.

[Mr David Burrowes (Enfield, Southgate) (Con)]

With my interest as a criminal defence duty solicitor, I recognise that this is a tough settlement. However, may I thank the Justice Secretary for doing what he said he would do—listen, engage with professionals on the front line and adapt the proposals to make them work? Given that competitive tendering has been a Labour idea and that attempts at introducing it have been made on a number of occasions, will he confirm, once and for all, that PCT is now in the bin—not the one marked “recycling” but the one marked “refuse”?

[Chris Grayling]

This settlement will be for four years, plus, potentially, one additional year from 2015, so it will take us into the foreseeable future. Of course, competitive tendering was Labour’s idea. I apologise to the hon. Member for Hackney South and Shoreditch (Meg Hillier) for not making the point about the thresholds. We will agree the quality thresholds that need to be crossed by bidders with the profession, so that we get something that guarantees what we all agree is the necessary level to ensure that a quality service is provided. It is worth saying, however, that legal qualifications in this country are among the best in the world, so if someone is legally qualified, I regard them already as blue chip.

[Richard Graham (Gloucester) (Con)]

The Secretary of State has listened carefully to the consultation on the original Labour idea of competitive tendering. He has achieved the necessary savings, he has ensured that only those with a strong connection to the UK can access taxpayer-funded—[Interruption.] Mr Speaker, the shadow Secretary of State has been chuntering away in a loud voice for most of this session, so may I finish without his interrupting me further? The Secretary of State has ensured that only those with a strong connection to the UK can access taxpayer-funded protection and he has looked after the interests of capable local legal firms in Gloucester. My constituents will welcome the changes. I regret only that the shadow Secretary of State is not capable of joining us in welcoming what has been announced today.

[Chris Grayling]

I very much welcome my hon. Friend’s support and his comments, and I am very grateful to him for them. The big problem that Labour Members have is that they were looking forward to an autumn of attacking the Government but we have a sensible set of proposals with which, I hope, most people will agree. That is Labour’s difficulty today.

[Steve Brine (Winchester) (Con)]

I welcome the Lord Chancellor’s statement and thank him for it. His movement on choice after he appeared before the Select Committee in early July was welcome. It was logical to many of us there that changes to the PCT regime would follow. Does he agree that the revised model of tendering will result in some consolidation of smaller firms, as the market inevitably responds—that is not bad thing—ultimately leading to a more stable environment for law firms in the future?

[Chris Grayling]

That has been a central part of what we have agreed with the Law Society; there has been an acceptance from both of us that these changes will lead to consolidation. They will lead to bigger, but not giant, firms, which are more equipped to deal with a tough financial climate but will continue to deliver a quality service. That is what we are looking to achieve.

[Bob Stewart (Beckenham) (Con)]

Does my right hon. Friend agree that a minimum of £225 plus VAT a day for a barrister in a court case is very fair?

[Chris Grayling]

I hope that it is fair. The aim is to ensure that there is a degree of certainty in all of this. We have put in place a taper mechanism, which I believe will reassure younger members of the Bar about the amounts they will be paid for the work they do in trials. That seemed to me to be a sensible development in our original proposal, and I hope that it will be welcomed.

[Julian Smith (Skipton and Ripon) (Con)]

I thank the Justice Secretary for listening to the concerns of rural solicitors’ businesses and barristers across north Yorkshire, and I welcome his focus on quality. There are serious allegations of corrupt behaviour among some solicitors’ firms in Bradford, and this focus on quality has to be taken seriously.

[Chris Grayling]

That is very important. I want us to develop, in partnership with the professions, some clear standards for firms. We expect law firms to meet high standards, to behave without absolute propriety and to deliver a quality service. We will set standards that are exacting but appropriate as we move into the contracting phase. We want quality legal services for the future.

[Sir Bob Russell (Colchester) (LD)]

The Lord Chancellor seems to have forgotten the Government’s localism agenda and support for small businesses, because although he said nice things about local high street solicitors, he gave the game away in the same paragraph when he referred to duty slots being allocated on capacity. Where does that place a two-person firm of solicitors that deals only with criminal law matters?

[Chris Grayling]

First, it leaves that firm completely free to continue its current specialisms and its own client work. If it wishes to bid for duty slots at police stations, it is free to do so in partnership with other organisations. From my point of view, it is crucial that I know that those people who are contracted to deliver duty slots in police stations will be there in one, two, four or five years’ time. If they disappear leaving a legal aid desert, I will not be able to guarantee that people will get access to legal services in a police station and that cannot be right.

Prison Capacity

Chris Grayling Excerpts

Wednesday 4th September 2013 Written Statements

[The Lord Chancellor and Secretary of State for Justice (Chris Grayling)]

The House is aware of my plans to modernise the prison estate so that we always have enough prison places for those sent to us by the courts but at much lower cost and in the right places to deliver our ambitions for reducing our stubbornly high reoffending rates.

We are doing this through a significant programme of replacing accommodation which is old, inefficient or has limited long-term strategic value and by reshaping the rest of the prison estate so that we are able to release offenders closer to home which we know improves their resettlement and prevents reoffending.

I am able to update the House today on the progress made and next steps in this programme.

In January I set out my ambition to build a new prison and as part of the spending review in June secured a £250 million investment for it to be built in north Wales. I can today announce that, following the assessment of several site options and subject to local planning approval, the new prison will be built on the former Firestone site in Wrexham.

Work will begin on-site next summer with the prison fully operational by late 2017. The new prison will provide up to 1,000 much needed jobs, great opportunities for local businesses and millions of pounds worth of construction opportunities. It also provides north Wales with its first ever prison, offering an opportunity for offenders from the region to be closer to their homes.

I can also announce that I have tasked my officials to come up with plans that would see the existing Feltham young offenders site replaced with a large new adult prison and a new, youth facility on adjoining sites in west London.

In 2012-13 we were able to remove 2,800 old and uneconomic places which has significantly reduced the running costs of our prisons. I announced in January that we will open up an additional 1,260 places in four new houseblocks. The first one at HMP The Mount, is on track to accept prisoners in September 2014. In addition we will open 180 new places at Rochester and Bure this year.

We are now in a position to close a further 1,400 uneconomic places which will save around £30 million per annum. This means the closure of the following prisons by the end of the financial year:

HMP Blundeston

HMP Dorchester

HMP Northallerton

HMP Reading

In addition, we will convert HMP Verne to an immigration removal centre, providing around 600 additional places to hold immigration detainees awaiting removal from the country. Existing staff will continue to run the site but the change means that the Home Office will meet the costs of its operation.

These changes form part of our overall plans that will reduce prison costs by over £500 million within this spending review period.

In addition we will begin discussions with the Duchy of Cornwall about the future of HMP Dartmoor. This lease has a long notice period so nothing will happen immediately but the age and limitations of a prison built in 1809 mean that it cannot have a long-term future as part of a modem prison estate. It therefore makes sense to discuss with the Duchy future options for the site.

It is right that we continue to meet the needs of the prison population. That is why during this year, I commissioned a review on how we best meet the needs of women and conducted a public consultation on proposals to transform youth custody. I anticipate being able to announce the outcome of both in October.

I can however announce two changes as a result of those reviews which form part of our overall prison estate strategy: HMP Downview will stop holding women prisoners and instead will hold adult male prisoners; and HMYOI Warren Hill will stop holding young offenders and will also change to hold adult male prisoners. Both changes will take place by the end of the financial year.

Electronic Tagging

Chris Grayling Excerpts

Thursday 11th July 2013 Commons Chamber

[The Lord Chancellor and Secretary of State for Justice (Chris Grayling)]

With permission, Mr Speaker, I would like to make a statement about the Ministry of Justice’s electronic monitoring contracts with G4S Care and Justice Services and Serco Monitoring.

These contracts provide for the tagging of individuals on bail and offenders under supervision in the community. The current contracts were awarded under the previous Government in November 2004 and are due to expire shortly.

The House will recall that I made an announcement on 17 May indicating that my Department had identified a number of issues surrounding the way in which we have been billed for monitoring under the current contracts, and that as a result I had ordered an independent audit of the billing arrangements under both contracts.

Let me begin by explaining to the House the nature of the issues that prompted the audit. As part of my Department’s work on tightening up procedures—both to prepare for the new electronic monitoring contracts which are now out to tender and to improve the quality of our contract management—we identified what appeared to be a significant anomaly in the billing practices under the current contracts. It appeared that we were being charged in ways not justified by the contracts and for people who were not in fact being monitored.

Following this discovery, I took immediate steps to investigate the issue, commissioning an audit by PricewaterhouseCoopers. I also sought assurances that there was no risk to the public as a result of issues we discovered, and I am clear that these billing issues have not given rise to any risk to public safety.

This audit has now confirmed the circumstances in which the Department was billed for services. This has included instances where our suppliers were not in fact providing electronic monitoring. It included charges for people who were back in prison and had had their tags removed, people who had left the country, and those who had never been tagged in the first place but who had instead been returned to court. There are a small number of cases where charging continued for a period when the subject was known to have died. In some instances, charging continued for a period of many months and indeed years after active monitoring had ceased. The House will share my view that this is a wholly indefensible and unacceptable state of affairs.

The audit team is at present confirming its calculations, but the current estimate is that the sums involved are significant and run into the low tens of millions of pounds in total, for both companies, since the contracts commenced in 2005. The audit shows that the overcharging began at least as far back as the commencement of the current electronic monitoring contracts in 2005. It might even date back as far as the previous contracts let in 1999.

The audit also reveals that contract managers in the Ministry of Justice discovered some of the issues around billing practices following a routine inspection in 2008. Although it appears that these contract managers had only a limited idea of the scope and scale of the problem, nothing substantive was done at that time to address the issues. None of that, however, justifies the billing practices followed by the suppliers. The House will share my astonishment that two of the Government’s biggest suppliers would seek to charge in this way. The House will also be surprised and disappointed, as was I, to learn that staff in the Ministry of Justice were aware of a potential problem and yet did not take adequate steps to address it.

Let me set out for the House what we are doing in response to these findings. The billing practices in question were clearly unacceptable and the Government will take all necessary steps to secure a refund for the taxpayer. In view of the seriousness of the issue, however, and having taken full legal advice, I am clear that, as Lord Chancellor, I must not only take action in terms of financial recovery, but seek to rule out the possibility that what went on involved dishonesty by anyone involved in the contracts. I have therefore put it to the two companies that we should now carry out an independent forensic audit, not just of the contractual arrangements, but of the evidence, such as internal e-mail trails between their executives, to establish the detail of what happened. I have now received their responses.

Let me deal with each company in turn. Serco, which is one of the Government’s biggest and most important suppliers, has agreed in full to such a forensic audit. It has said that it will co-operate fully with our auditors, PricewaterhouseCoopers, and that it takes the issue extremely seriously, and it assures me that senior management were not aware of it. It does not believe that anything dishonest has taken place, but we have agreed that if the audit does show dishonest action, we will jointly call in the relevant authorities to address it. Serco has also agreed to a forensic audit of all my Department’s contracts with it to ensure that there are no other issues. In addition, it has decided that it would not be appropriate for it to continue to participate in the current tender process for electronic monitoring and has agreed to withdraw. I am grateful to Serco for its co-operation.

Let me now turn to G4S. We put the same proposal for a further detailed forensic audit to G4S last night. It has rejected that proposal. I have given careful consideration to how to respond. I should state that I have no information to confirm that dishonesty has taken place on the part of either supplier, but given the nature of the findings of the audit work so far and the very clear legal advice that I have received, I am today asking the Serious Fraud Office to consider whether an investigation is appropriate into what happened in G4S and to confirm to me whether any of the actions of anyone in that company represent more than a contractual breach. I am also disappointed that G4S still feels it appropriate to participate in the tendering process for the next generation of electronic monitoring contracts, which we are in the process of renewing. I have therefore started a formal process to determine whether to exclude it from this competition. Furthermore, we will be commencing forensic audits of all existing contracts that the Department has with G4S.

Let me deal with some other immediate procurement issues that I need to address. My Department was also due to announce the results of the competition to take over the management of prisons in Northumberland and Yorkshire. I can tell the House that the winning bidder for Northumberland is Sodexo, and that this transfer will continue as planned. However, the leading bidder in Yorkshire was Serco. I have decided that we will delay the award of this contract until the audit process I have put in place is complete, and clearly it will only be awarded if that process is completed to our satisfaction. We have also begun work on two new house blocks at prisons run by Serco and G4S. Since these are construction contracts at existing prisons and are an essential part of our replacement strategy for the older parts of the prison estate, I intend to proceed with this construction work.

As I have said, it is not only the behaviour of the suppliers that needs to be examined closely. I am making changes in my Department because it is quite clear that the management of these contracts has been wholly inadequate. I have put in place an entirely new contract management team, led by my procurement director and validated by the independent auditors. The Permanent Secretary is also instituting disciplinary investigations to consider whether failings on the part of individual members of staff constitute misconduct. I have also commissioned an urgent review of contract management across my Department’s major contracts, which will report by the early autumn. It will include independent audit expertise and will be overseen by my Department’s lead non-executive director, Tim Breedon, the former chief executive of Legal and General. I want to put in place arrangements that are robust and at all times deliver value for money for the taxpayer.

On wider Government contracting, the Minister for the Cabinet Office, my right hon. Friend the Member for Horsham (Mr Maude), is today announcing a review of all contracts held by both G4S and Serco across Government. In addition, this review will determine how Government will better manage similar contracts in the future. Separately, the National Audit Office is looking at the scale of Government contracting activity with key suppliers and how effectively those relationships are being managed by Government.

I have made it clear from the outset that I regard this as a very serious issue and have taken immediate action to address it. I would, though, like to reassure the House that, however serious these problems are, they concern billing arrangements rather than wider issues of public protection. I remain committed to the use of electronic monitoring as a powerful tool in supervising offenders. The steps we are taking to retender the contracts will deliver a significantly improved service that will be subject to robust contract management in the years ahead. I believe that the private sector brings significant benefits in delivering efficient and cost-effective services to the public, but we will not tolerate unacceptable activity of any kind, no matter who is responsible. I am angry at what has happened and am determined to put it right. I commend this statement to the House.

[Sadiq Khan (Tooting) (Lab)]

I thank the Justice Secretary for advance sight of his statement, which I read in the presence of his officials 20 minutes ago. I can honestly say that I was left speechless.

Tagging is a crucial part of the criminal justice system, and the use of this technology has allowed the much greater use of curfews and home detention over the past 20 years. The Justice Secretary’s statement is a serious one, with wide-reaching consequences, and I have some questions for him. What other sanctions has he considered taking against the companies concerned? I remind him of what has happened: charging for people who were back in prison and had had their tags removed; charging for people who had left the country; charging for those who had never been tagged in the first place, having been returned to court; charging continuing when the subject was known to have died; and, in some instances, charging continuing for many months and years after active monitoring had ceased.

To the lay public, that appears to be straightforward fraud: obtaining property by deception. The Justice Secretary mentioned the SFO, but does he not agree that both companies should be investigated by the SFO, not simply G4S? Will he pass on all the papers from the audit to the police and the SFO and ask them to investigate whether any criminal offences have been committed? I am sure he will agree that the law applies to everyone, including big multinationals. What we need is the police and the SFO going to G4S and Serco offices and preserving evidence, not some cosy arrangement with one of the two companies. Will he confirm that all the evidence has been preserved by the two companies, as well as the Ministry of Justice? A forensic audit is one thing; what we need now, though, is the proper external authorities to investigate. I hope he agrees.

How soon will G4S and Serco be repaying the amount overbilled, or, as some will infer, claimed by fraud, and how much will it be? Have the companies concerned accepted guilt? Have the MOJ officials accepted their part in this? In May, I asked the Justice Secretary to ask the Public Accounts Committee for a full investigation into this? Will he now ask it to do so?

In 2012 and 2013, G4S and Serco were paid more than £500 million of taxpayers’ money just by the MOJ, and the MOJ paid nearly £800 million—10% of its entire budget—to five companies. Will the Justice Secretary agree an independent audit of all contracts with the MOJ? How confident is he that none of the other private companies with which the MOJ has contracts has over-billed?

I understand that G4S and Serco have a number of contracts with the Home Office and a number of other Departments—I know the Chair of the Home Affairs Committee, my right hon. Friend the Member for Leicester East (Keith Vaz), raised a number of concerns over the past year about the conduct of G4S. Serco and G4S are two of the Government’s biggest contractors. The Justice Secretary mentioned the Cabinet Office, but in the light of his statement will he agree to the National Audit Office investigating all contracts that those two companies have with the Government?

There appears to have been a systematic pattern of fraud, and if we add to that the events of the past week and the inquest verdict, the fiasco at last year’s Olympics and the security that G4S failed to provide, we see a pattern emerging. Will the Justice Secretary confirm that those two companies will not be awarded any further Government contracts? Giving that tagging involves potentially dangerous offenders, we must be sure that public safety has not been compromised. Some 20,000 people are tagged at any one time, so what specific assurances can the Justice Secretary provide that public safety was not undermined at any time?

At the same time as serious failings have been exposed in the way the MOJ buys in hundreds of millions of pounds of services, the Justice Secretary is proposing a massive expansion in the amount of work handed over to private companies. He will be aware that the same two companies responsible for today’s statement are responsible for a number of other contracts in the MOJ—he has already referred to the prisons contracts—and they are the leading contenders for the privatisation of the probation service. In the light of that, will he confirm whether he intends to bar those companies from the retendering process for tagging and from any future contracts? He will be aware of concerns about the risk register and the privatisation of the probation service. Given today’s statement and its implications for G4S and Serco, will he delay the roll-out of the privatisation of the probation service to allow full and proper consideration of those findings?

The Justice Secretary has raised serious matters and we must not only get to the bottom of what has happened and see justice, but lessons need to be learned. We hope that the Justice Secretary will learn the right lessons.

[Chris Grayling]

On the last point, it is important to say that we are learning the right lessons. That is why the issue emerged in the first place. The tighter contract management procedures that we are putting in place have revealed shortcomings that took place under a contract that was let in 2005, and information that came to the Department in 2008. The right hon. Gentleman will remember who were in government in those two years. This Government are taking a more robust approach to contract management, and this issue has arisen as a result.

The right hon. Gentleman makes a point about the privatisation of the probation service. We are outsourcing probation to a range of different organisations not linked to today’s situation, and a large number of organisations have expressed an interest, including those from the voluntary sector that have immense skills in this area. I would not countenance a situation in which those organisations are tainted by the actions of two individual companies, or where we allowed a debate about two contractors to taint the reputations of outsourcing organisations that work and do a good job across government.

The right hon. Gentleman made some specific points about the two companies involved. Last night, we put to those companies that we would ask for a forensic audit, at a level that will meet any kind of investigative standards, to be carried out by PricewaterhouseCoopers, one of our leading independent auditors that works on such investigations. I am satisfied about the quality of the investigation it will carry out with Serco, and the management of Serco has accepted that the consequence of that investigation, if dishonesty is found, will be a joint reference to the authorities. To my mind, that audit meets any test we need to address. Unfortunately, G4S has not chosen to accept such an audit, and we have therefore passed the matter straight to the Serious Fraud Office.

I must be careful because this is a sensitive legal process. At this time, I do not have evidence of dishonesty. I have a situation of unacceptable practice, but not of dishonesty, and that is why I have commissioned a detailed forensic audit from those with expertise in such matters. For G4S we have done what people would expect us to do and invited the Serious Fraud Office to rule on the matter.

The right hon. Gentleman mentioned the Public Accounts Committee and the National Audit Office. I confirm that the National Audit Office has been aware of this investigation from the start. It is already investigating contracts within Government, and we are liaising closely with it. He mentioned all other contracts, and my right hon. Friend the Minister for the Cabinet Office and Paymaster General will today set out his plans to take forward work he has already started to address contract management across Government. The review I have announced led by Tim Breedon, our lead non-executive director, will address the issue raised by the right hon. Gentleman about all contracting with major contractors across the Department, including smaller contractors.

I can reassure the right hon. Gentleman on public safety as I sought to establish that very early in this process. I have seen no evidence whatsoever to suggest that public safety has been compromised. The issue is about people who were recalled to court or to prison but where the charging continued, so I can lay to rest the right hon. Gentleman’s concerns on that point. He also asked about the acceptance of guilt, but, in the legal process, I cannot comment on the position of the companies. They must set that out themselves. I have said that Serco is being constructive and collaborative, and I have set out the process for G4S. I say clearly that there have been failings at the Ministry of Justice that go back over the past decade, possibly longer. Those shortcomings are now being addressed but they should not have happened in the first place and I have indicated that, if necessary, disciplinary proceedings will be undertaken.

These are serious matters. We are entering a legal process and hon. Members across the House will understand that I must be cautious in what I say to avoid compromising legal proceedings. The House should be under no illusion, however, that I am dealing with the issue with the utmost seriousness. We will take all appropriate action and we cannot allow such things to continue unchecked.

[Mr Philip Hollobone (Kettering) (Con)]

May I praise the strong, expeditious and decisive action taken by the Lord Chancellor in response to this issue, and the way he has co-ordinated the Government’s response with the Minister for the Cabinet Office and Paymaster General, and the Attorney-General? As he indicated in his statement, Whitehall needs to raise its game on contract management. Will he continue to work as closely as possible with our right hon. Friend the Minister for the Cabinet Office and Paymaster General to get this matter resolved at permanent secretary level as soon as possible?

[Chris Grayling]

I am grateful to my hon. Friend for his comments and I give him that assurance. Looking back to when the issue first became visible in the Department, it is clear that existing expertise in contract management was not up to the job. Those failings and shortcomings should never have happened, and I intend to introduce measures to ensure that they never happen again.

[Keith Vaz (Leicester East) (Lab)]

This is a shocking statement and I believe that the Lord Chancellor has acted swiftly and decisively in dealing with the issue. G4S should never have got another Government contract after the shambles of the Olympics. G4S and Serco hold 17 contracts worth £118 million with the Home Office, and although I accept what the Lord Chancellor has done in referring G4S to the Serious Fraud Office and the police, I think he should have done the same to Serco. When its chief executive appeared before the Home Affairs Committee on 25 June, he said that he did not believe that Serco had overcharged. The right hon. Gentleman is right to have acted as he did, but he should not take a different approach to Serco. We need the high-risk register that the Home Affairs Committee recommended after the Olympics. That register should be held by the Cabinet Office, and any company that has failed the taxpayer should be on it and should not get another contract.

[Chris Grayling]

Let me be clear about the different treatment of G4S and Serco. I have followed the legal advice I received very closely, and the right hon. Gentleman and all Members of the House would expect me to follow such advice in the interests of the taxpayer and the Government. I have done that, and the approach I have chosen follows closely the legal advice I received. I would not expect any Member of this House to expect me to do otherwise.

As for how the Cabinet Office approaches contracting, my right hon. Friend the Minister for the Cabinet Office, who is sitting next to me, will have heard what the right hon. Gentleman said. The Cabinet Office is taking both this issue and the broader issue of contracting very seriously, and my right hon. Friend will be saying more in due course.

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

These are very serious matters indeed. Like others, I welcome today’s statement and the measures that the Secretary of State is taking. We have had interesting reactions from the two companies, and I hope that there will now be a robust means of oversight in his Department and in others, as contracts are looked into. The public’s concern is whether this is a security issue, so will he confirm to the House that this is a billing issue and that it had no impact on public safety?

[Chris Grayling]

I can give my hon. Friend that assurance. This was obviously a matter of great concern to us, as we looked at these issues back in May for the first time. I can confirm that the Department has looked closely at the individual cases. The audit carried out by PricewaterhouseCoopers so far has gone through cases line by line. We have found no evidence of any issues that would give rise to public safety concerns; this is a financial issue.

[Mr Jack Straw (Blackburn) (Lab)]

First, I thank the Secretary of State for his statement and also for his courtesy in letting me know that he was going to make it, although I quite understand that, for reasons of commercial sensitivity, he could not inform me of its content. I share the intense anger and shock of my right hon. Friend the Member for Tooting (Sadiq Khan) and, above all, the Secretary of State himself about this issue, not least because it was during my watch in 1999 that the original contract was let, before I was again responsible for the contracts between 2007 and 2010. It is a matter of deep regret to me that these failings happened at a time when I was the Secretary of State responsible for them. I want to know exactly why the failure happened, and I am glad to hear that steps are being taken to ensure that robust systems are put in place.

When the Secretary of State said in his statement that there was “a routine inspection in 2008”, but that “nothing substantive was done at that time to address the issues,” can he say whether the “nothing substantive” included not telling Ministers? I do not have complete recall of the contents of my 365 boxes in 2008, but I do not recall the matter ever being drawn to my attention. It would helpful to know whether it was. Lastly, I commend the review that the Minister for the Cabinet Office is establishing, because the control of long-term contracts with outside contractors is an issue that has bedevilled successive Governments for many decades.

[Chris Grayling]

I have seen no evidence to suggest that the issue reached the right hon. Gentleman’s desk. I can reassure him that there is no suggestion that he was briefed about it. There is no evidence that we have so far seen that the Department was aware of the nature of what was happening up until 2008. There have subsequently been a number of interchanges in relation to this matter. In no case do we believe that the Department had full sight of the scale of what was happening, but it is clear to me that things were known at a junior level about what was going on and it should have been addressed. One of the things we are investigating is why it was not, and that might include disciplinary action, as I set out earlier.

[Stephen Barclay (North East Cambridgeshire) (Con)]

The right hon. Member for Tooting (Sadiq Khan) referred to the Public Accounts Committee. As a member of that Committee, may I say how welcome it is to see the firm, fair and quick way in which the Minister has brought the issue before the House and gripped it in a way that is different from many other areas that come before the Public Accounts Committee?

Further to the question from the right hon. Member for Blackburn (Mr Straw), will my right hon. Friend say explicitly whether the contracts were let before 2010, in which case the over-billing would predate the last general election? Will he also be clear that the reason the issue has come to light is because of the way he is gripping the renegotiation of such contracts?

[Chris Grayling]

I can confirm that the contracts were originally negotiated in November 2004 and implemented in 2005. The original contracts date back, as the right hon. Member for Blackburn (Mr Straw) said, to 2009.

[Mr Straw]

To 1999.

[Chris Grayling]

To 1999—I beg the right hon. Gentleman’s pardon.

As for how the issue has been addressed more recently, let me be clear that none of the team leading the effort in the Ministry of Justice today was in position when the matter first came to the Department’s attention in 2008. The team who are leading the renegotiation have done a first-rate job of putting together a much tighter contract management framework, which highlighted this issue. It is to their credit that they found it, and I am very grateful to them that they did.

[Jeremy Corbyn (Islington North) (Lab)]

I thank the Secretary of State for his statement, which is quite shocking in its content. Does he not think there is a case for advising local government and the national health service, both of which have large contracts with both companies, of what action he is taking and why he has taken it, to see whether they might care to look at their contracts with the two companies and the performance of them? Does he not think for a moment that his almost love affair with contracting out services to the private sector should be tempered by possibly thinking of a public service option for delivering such important government services, rather than taking the first position, which is always to go to a private contractor?

[Chris Grayling]

I am absolutely certain that my colleagues in the Cabinet Office will make both local government and health service bodies aware of what has happened. That would be right and proper.

On the hon. Gentleman’s latter point, I appreciate that he did not always agree with the leadership of the previous Government—I give him credit for that—but when he talks about a “love affair” with contracting out, I would remind him that the contracts were not let by this Government, but by the last Government.

[Steve Baker (Wycombe) (Con)]

May I add my congratulations to my right hon. Friend on the robustness of his response? The emphasis of his statement is quite right, but will he extend his remarks and say something about the legitimate levels of pricing in such contracts? Earlier this week I visited the Cabinet Office to see how the Government Digital Service is wrestling with some really quite appalling pricing levels, which are the legacy of the last Government. Will he be able to drive down the cost of such contracts in future?

[Chris Grayling]

I can give my hon. Friend that assurance. In fact, we are about to launch a revolution in tagging generally. The arrival of GPS tagging will enable us not simply to monitor whether an offender has left their home, but to understand whether they are breaking a curfew or, for example, whether a paedophile is going close to a school. That will transform the way in which tagging works and will do so—I can assure him—at a much lower price than we have paid up to now.

[Paul Goggins (Wythenshawe and Sale East) (Lab)]

I join others in commending the Justice Secretary for the action he has taken and the statement he has made today. I say that as the Minister for prisons and probation in 2004, when the contracts were awarded. If there has been wrongdoing, he is right to root it out in the way that he has set out.

May I press him a little further on his plans for the probation service? I can only ask him to accept my word that I do so not in a partisan way, but because, like him, I care about the protection of the public. Given that two major players are facing serious questions and are likely to be out of the game, does it not make sense to look at having a more limited competition for certain services in one part of the country, rather than moving so rapidly to a national roll-out?

--- Later in debate ---

[Chris Grayling]

I would make two points to the right hon. Gentleman. First, we must be careful not to apply the judgments that will inevitably be made after today’s announcement to all private sector contractors that work with Government. That would be a great shame and the wrong thing to do. I should also say that even in the two companies in question, there are large numbers of people—all our constituents—who are at work today, doing their best to operate on behalf of the public sector. We should not allow them individually to be tainted by what has happened.

At the same time, when we look at our plans for probation reform, we see a large number of organisations —public and voluntary organisations, as well as potential mutual organisations from staff—interested in providing a solution to what is a glaring problem, whereby at the moment people who go to prison for less than 12 months get no supervision at all. The longer we wait to introduce the reforms, the longer those people will walk our streets without supervision. When people talk about “leading candidates” for contracts, I am clear that there are no “leading candidates” for contracts in our probation reforms. We have not started a contracting process. We are actively encouraging as wide a range of participation as possible. I have been talking to the social investment sector to bring in social capital. We are working actively with the Cabinet Office to encourage employee mutuals to come forward, either individually or in partnership with potential investors. This is not a world that will simply be handed over to a couple of big companies. I am very much of the belief that there is expertise out there, which I want to capture, and skills that will help to bring down reoffending.

[Henry Smith (Crawley) (Con)]

G4S is headquartered in my constituency and operates a number of contracts there, so these fraud allegations in connection with electronic tagging are deeply troubling. May I seek an assurance from my right hon. Friend that, as the local Member of Parliament, I will be kept up to date with the investigation, particularly as it will be concerning to many of the day-to-day, honest employees who work for the company and who are going about their business?

[Chris Grayling]

I give my hon. Friend that assurance absolutely. I say again that, as of today, I do not have evidence of dishonesty in either company. What I do have is legal advice that says that, on the back of the audit we have carried out, I have a duty to do further detailed forensic work to establish where there is a possibility of dishonesty. Serco has agreed to co-operate with that work. To my regret, G4S has not. That is what has prompted me to believe that I have no option but to ask the Serious Fraud Office to consider whether a formal investigation should take place.

[Derek Twigg (Halton) (Lab)]

First, I put on record that I welcome the firm action the right hon. Gentleman has taken today. I would like to push him a little further on the point raised by my right hon. Friend the Member for Blackburn (Mr Straw). Although we have established that no Ministers were told of this, the Secretary of State said:

“contract managers had only a limited idea of the scope and scale…nothing substantive was done”.

What does he mean by “limited idea” and “substantive”? To use the word “substantive” means that something must have been done. On the “limited idea” of the scale of the problem, why was that then not followed up with further action?

[Chris Grayling]

The hon. Gentleman raises a good point to which I do not yet know the answer fully. It is clear that, between 2008 and the present, on various occasions information has reached the Department that suggests something was amiss. It is also clear that that information was never followed up in a way that would have presented the true picture of the problem. We are now launching formal proceedings internally, which are likely or may well include—depending on the circumstances of the individuals—disciplinary proceedings to establish precisely what did go wrong. Something clearly did go wrong. Enough knowledge came into the Department to flag this issue some years ago, but it was not acted on.

[Mr David Nuttall (Bury North) (Con)]

I thank my right hon. Friend for his statement and for the strong and decisive action he has taken. Given that both companies are substantial major companies, we may reasonably expect that all the moneys will be recovered. That will effectively amount to an unanticipated lump sum of income for the Ministry. Will the Lord Chancellor say at this stage what plans he has to use the lump sum? May I suggest that perhaps it be used to improve, modernise and upgrade the tagging system?

[Chris Grayling]

I have some sympathy with my hon. Friend’s ambitions. The upgrade of the tagging system will happen anyway within the Ministry’s existing budgets. The difference in the next couple of years will be marked. It will provide a much greater and more effective resource to both those monitoring offenders and to the police guarding such places as our town centres, to understand who is where at any particular time. It will also, at times, exclude people from suspicion of an offence, because tag records will show if they were not at the scene of a crime. He can be reassured that that is happening anyway.

I have every intention of getting back every last penny to which we are entitled. Our auditors are working on the exact sum at the moment. That is the right thing to do for the taxpayer.

Determinate and Indeterminate Sentences and Recalled Prisoners

Chris Grayling Excerpts

Thursday 11th July 2013 Written Statements

[The Lord Chancellor and Secretary of State for Justice (Chris Grayling)]

I have written to Sir David Calvert-Smith, chairman of the Parole Board for England and Wales, advising him that it is our intention to withdraw the Secretary of State’s directions to the Parole Board in respect of the release of determinate sentence, indeterminate sentence and recalled prisoners. The directions in respect of Parole Board recommendations on the transfer of indeterminate sentence prisoners to open conditions will remain in force.

The Parole Board has the important responsibility of determining whether some of the most dangerous prisoners in the criminal justice system can be safely released back into the community. We have recently enacted legislation in the form of the Legal Aid, Sentencing and Punishment of Offenders (LASPO) Act 2012 which contains a clear and consistent statutory release test that the board must apply in making those decisions—that is, the board must not direct a prisoner’s release unless their detention is no longer necessary for the protection of the public. The LASPO Act applies this “public protection” test to all cases which come before the board and also provides a power for the Secretary of State to amend the test by order. In view of this, I consider that it is no longer necessary or appropriate for the directions to remain in place.

In its original incarnation, the board was an advisory body which made recommendations to the Secretary of State who was responsible for the final decisions on release. It was in this context that the power for the Secretary of State to issue directions to the board was established. Since then, however, the board has evolved into an independent decision-making body. I believe that it is more appropriate, therefore, for the board to set its own guidance in relation to the application of the statutory release test that Parliament has put in place.

We are, therefore, withdrawing the existing directions in favour of the Parole Board applying its own guidance. The board issued guidance for its members in November 2012 which sets out how the statutory release test in the LASPO Act is to be applied. In addition, the board has produced guidance which lists the factors to be taken into account by panels when considering whether to release different categories of prisoner. This list largely reflects the same factors set out in the Secretary of State’s directions, so in practical terms the withdrawal of the directions will not materially change how the board approaches its release decisions. I should like to emphasise that the protection of the public will remain at the heart of every release decision made by the board.

Copies of the Parole Board’s guidance have been placed in the Libraries of both Houses.

Azelle Rodney Inquiry

Chris Grayling Excerpts

Friday 5th July 2013 Written Statements

[The Lord Chancellor and Secretary of State for Justice (Chris Grayling)]

Sir Christopher Holland has today published the report of the inquiry which he has conducted under the Inquiries Act 2005 into the death of Azelle Rodney. The inquiry’s terms of reference were:

“To ascertain by inquiring how, where and in what circumstances Azelle Rodney came by his death on 30 April 2005 and then to make any such recommendations as may seem appropriate”.

The Metropolitan Police and the Independent Police Complaints Commission will consider the inquiry’s findings and recommendations carefully and will respond appropriately.

I would like to take this opportunity to record my appreciation of Sir Christopher and his team for all the work they have done over the last three years in conducting the inquiry.

Oral Answers to Questions

Chris Grayling Excerpts

Tuesday 2nd July 2013 Commons Chamber

[Damian Hinds (East Hampshire) (Con)]

3. What assessment he has made of the contribution that financial inclusion programmes can make towards reducing reoffending rates.

[The Lord Chancellor and Secretary of State for Justice (Chris Grayling)]

Alongside our probation reforms, it is important to look at other areas in which we help offenders when they leave prison. It is often the basic things, like having a bank account, that they need help with to avoid slipping back into a life of crime. We recognise the importance of financial inclusion, which is why we grant-fund Unlock, a programme that helps prisoners establish a relationship with a commercial bank. Indeed, the prisons Minister, my hon. Friend the Member for Kenilworth and Southam (Jeremy Wright), is doing a lot of work at the moment with the banks to try to ensure we can offer financial services to those who leave prisons, so they can get their lives back together.

[Damian Hinds]

Does my right hon. Friend agree that credit unions can play a unique and valuable role not only in providing the nuts and bolts of banking, but in improving financial capability and promoting savings to increase financial resilience?

[Chris Grayling]

I am a great fan of the credit unions. I have seen their work both in my previous role as employment Minister and now as potential contributors to the process of rehabilitating offenders. I absolutely agree with my hon. Friend that we should support and encourage the work of credit unions. They can make a huge difference for those who cannot access financial services through other means.

--- Later in debate ---

[Mr Speaker]

Indeed, but not financial inclusion, which was the purport of the question. However, the Secretary of State is a dextrous fellow, and I am sure he can respond appropriately.

[Chris Grayling]

Well, Mr Speaker, I simply say that I will take a look at the case.

[Mr Speaker]

Indeed.

--- Later in debate ---

[George Hollingbery (Meon Valley) (Con)]

7. What assessment he has made of the effect on barristers of his proposed changes to legal aid.

[The Lord Chancellor and Secretary of State for Justice (Chris Grayling)]

Our analysis, based on applying our proposals to the cases handled by the Legal Aid Agency last year, suggests that overall the majority of criminal advocates would either be better off or see their income unchanged as a result of the fee proposals, while civil barristers affected, who generally receive higher fees than other civil advocates, could see their income reduced.

[George Hollingbery]

Could the proposals not have been centred around a fixed-fee per case, salami-slicing budget cuts across the board or restructuring? Will not this arrangement protect the incomes of lower paid barristers?

[Chris Grayling]

My hon. Friend is absolutely right. That was part of our objective. Some people argued that we should go for one case, one fee, but that would in my view do deep long-term—if not total—damage to the Bar. We chose not to go down that route. We have put together a package of proposals that, on the basis of the case mix carried out last year by junior barristers, should leave a substantial proportion of them either with an unchanged income or a slightly increased income.

[John Healey (Wentworth and Dearne) (Lab)]

19. If legal aid cannot be paid unless permission is granted for a judicial review, does the Justice Secretary accept that lawyers will be unable to take on some of the strongest cases such as when local authorities might refuse to recognise their duty to house a homeless family? Those are exactly the kind of cases where they will offer an early settlement or a no-cost settlement.

[Chris Grayling]

I am afraid that I think the current situation is unacceptable, whereby we are obliged to provide legal aid to anyone who starts a judicial review regardless of the strength of their case. If an individual has a strong case with their lawyer against a local authority, they should seek to recover their costs from that local authority. It is not the job of the taxpayer to bank-roll all cases.

[Sir Alan Beith (Berwick-upon-Tweed) (LD)]

Has the Lord Chancellor heard from the Bar Council since the Law Society sent me a letter yesterday describing the constructive progress that had been made in discussions? Does he recognise the genuine concern that when a fundamental change is made in the relationship between the two sides of the profession, it has to be after very careful consideration?

[Chris Grayling]

My right hon. Friend makes an important point. Over the past few weeks, I have had very constructive engagement with the Law Society and I welcome the counter-proposals it has put to us. We have recognised many shared objectives in that and it has behaved with professionalism over this matter. I was very disappointed that when the Bar Council submitted its report and recommendations to us in response to our consultation it did not contain the same degree of constructive engagement. I am due to meet the Bar Council later today and I hope we will see that change.

[Karl Turner (Kingston upon Hull East) (Lab)]

Now that the Lord Chancellor concedes that client choice is integral to the criminal justice system, when will he announce that price-competitive tendering has been dumped once and for all?

[Chris Grayling]

The hon. Gentleman needs to realise that the concept of competitive tendering in criminal legal aid was originated by his own party. Now we are hearing the Labour party oppose the things for which it argued for years, and it is typical of this Opposition that they will say one thing when in government, and when in opposition will say something completely different. I am proud to be part of a party that is defending health budgets and taking tough decisions in other areas; the hon. Gentleman is part of a party doing the opposite.

[Mr Philip Hollobone (Kettering) (Con)]

Although legal aid is no longer available for most family litigation, it is still available for family mediation, yet many mediation services have seen their inquiries halve since April because clients are under the mistaken belief that it is caught up in the changes. Given that mediation is often better than litigation, what can the Secretary of State do to advertise the fact?

[Chris Grayling]

I am very concerned to pursue that. I am aware of the issues that my hon. Friend mentions. It may well be down to the fact that there was a surge in cases prior to the legal aid changes that came into effect in April, but I can give him an assurance that this is very much on my radar, and I intend to pursue it.

[Mr Andy Slaughter (Hammersmith) (Lab)]

Last week, the Lord Chancellor was telling some of the 16,000 respondents to his legal aid consultation that their responses had been automatically deleted, but he must have read some of them, as they provoked his embarrassing U-turn on choice of solicitor yesterday. Will he now also U-turn on forcing small firms out of business and on giving cash incentives for guilty pleas, and will he abandon the further cuts in civil legal aid that will, according to the Parole Board among others, cost several times the £6 million he claims they will save?

[Chris Grayling]

Labour Members really do not get it, do they? Government Minister consults on proposals, listens, makes some modifications, and gives an early decision to help people, so they are not attacking proposals that have changed. Labour Members never listened to anybody when they were in government; they just ploughed ahead regardless.

The hon. Gentleman is the person who said, in 2011, that the Government should look for

“efficiencies in the criminal legal aid system,”

to

“save…money”.—[Official Report, 2 November 2011; Vol. 534, c. 958-9.]

We are now doing that; they have changed their minds. It is shambolic.

[Andrew Stephenson (Pendle) (Con)]

8. What representations he has received from smaller law firms on his proposals to reform criminal legal aid.

[The Lord Chancellor and Secretary of State for Justice (Chris Grayling)]

The recent consultation “Transforming Legal Aid” generated around 16,000 responses, which, contrary to reports, have been read extensively by individuals, including many by myself. Many were from smaller law firms or those who work within a smaller law firm. I have personally attended events organised by the Law Society where I met many solicitors who practise with smaller firms. I met a number of people from smaller firms in the north-west last week, and we will continue to talk to all the representative bodies in the weeks ahead.

[Andrew Stephenson]

I thank the Secretary of State for his answer. On 24 May, when I met a number of solicitors and barristers from across Pendle, they raised several concerns with me. However, principally they believe the savings that my right hon. Friend is planning to make have already been made, and the figures the Government are using are out-of-date legal aid totals. What reassurance can he provide to them?

[Chris Grayling]

I can give my hon. Friend my assurance that that is not the case. There are a number of false rumours floating around. The figures that we used for the recent consultation were based on the criminal legal aid spend in 2011-12, which were the most up-to-date figures when we published the document. When developing these proposals, we have also taken fully into account the savings that came out of the Legal Aid, Sentencing and Punishment of Offenders Act 2012, which were presaged by the previous Government, who set in train the initial process towards cutting legal aid costs. However, given the continuing pressure on public finances, we do, I am afraid, still need to bear down on the cost of legal aid.

[Jeremy Corbyn (Islington North) (Lab)]

Could the Secretary of State assure the House that none of the e-mailed responses to his consultation has been deleted? To make everybody happy, will he ensure that every single one of them is published, because there seems to be a story out there that somehow or other his Department is not interested in the response to the consultation process, and therefore it has been deleting unwanted e-mails? I am sure that is not the case, but could he assure the House that it is not so?

[Chris Grayling]

My understanding is that that is not the case, and if there is any suggestion that it is the case, we will ask the people who sent the e-mails to resend them. However, I can assure the House that as far as I am aware, every submission is in our hands, is being read, and will be considered properly.

[Tessa Munt (Wells) (LD)]

All of us understand the need to control costs, but I wonder how the Secretary of State will ensure that the creation of a single fixed fee, payable regardless of whether an individual pleads guilty, will not create a direct conflict of interest between the legal representative and his or her client.

[Chris Grayling]

It is clearly in our interests to have a system where we encourage people who are guilty to plead guilty early. That saves money. It is the right thing to do for society. I do not believe or accept that we would be in a position where any qualified lawyer would try to encourage someone to plead guilty when they were not guilty, but of course we are listening to all the responses from the consultation and will bring forward further proposals in due course.

[Sadiq Khan (Tooting) (Lab)]

May I say, in the most courteous way, to the Justice Secretary that he should revisit some of the answers on legal aid he has given today? He is just wrong on a number of points. There is now a general consensus that his Department’s reform of court translation services was a shambles—the Select Committee on Justice, the National Audit Office and the Public Accounts Committee all agree. What differences are there in his plans to reform legal aid to avoid repeating the mistakes made in the previous set of reforms?

[Chris Grayling]

Let us be clear: it is no secret that the handling of contracting of translation services could have been better, and lessons have been learned. However, that service is now delivering to a very high standard and saving the taxpayer millions of pounds. The Opposition simply do not get that we have to take tough decisions to save money to deal with the mess they left behind.

[George Eustice (Camborne and Redruth) (Con)]

9. What assessment he has made of the effectiveness of the small claims procedure.

--- Later in debate ---

[John Pugh (Southport) (LD)]

15. What impact assessment he has conducted on the potential effect of his proposed changes to legal aid on the quality and equity of legal representation in criminal cases.

[The Lord Chancellor and Secretary of State for Justice (Chris Grayling)]

Although we are clear that we must continue to bear down on the cost of legal aid, under our proposals, and indeed under any actions we take, quality legal representation will still be available to all who need it.

[John Pugh]

I congratulate the Government on having the political maturity to rethink their proposals. Does the Secretary of State agree that we cannot compromise the quality of British justice, even in a time of austerity?

[Chris Grayling]

I agree with my hon. Friend. Of course, I regard the qualifications available to both the solicitors’ profession and the Bar in this country as of a high international standard. If a qualified solicitor or barrister is available to help somebody in a legal predicament, that is a sign that we are doing the right thing to support them and that will not change.

[Derek Twigg (Halton) (Lab)]

Why, then, did the Secretary of State think it was a good idea to limit whom a person can pick to be their solicitor?

[Chris Grayling]

My key concern is to ensure that we have universal coverage, even in tough times. I have consulted the legal profession, put forward ideas and listened, which I think is what they hoped a Government would do. I have made a modification, but nobody, and certainly not the Labour party, should be under any illusions: we have to meet financial targets and tough decisions lie ahead. The question is whether the Opposition support those changes, because I have heard no suggestion that they would reverse them.

[Mr Andrew Turner (Isle of Wight) (Con)]

My right hon. Friend and I have already spoken about this subject. I believe that there would be very great difficulties for people in need of legal aid on the Isle of Wight. The travelling times and the difficulty and cost of accessing legal advice on the mainland would be of a completely disproportionate magnitude to those experienced elsewhere in the country. Will he outline how he plans to address that problem?

[Chris Grayling]

One of the comments from colleagues in the House and elsewhere, which we must clearly factor in when developing the next stage of the proposals, is what we will do in areas that are rural or have particular geographical issues. That is something I am very mindful of—

[Karl Turner (Kingston upon Hull East)]

It is a mess.

[Chris Grayling]

It is all very well for Labour Members to say that it is a mess, but we are making changes that they recommended and said were necessary. We are making a financial decision to sort out a mess they left behind. [Interruption.] Where do they stand?

[Mr Speaker]

Order. The hon. Member for Kingston upon Hull East (Karl Turner) should not keep prating noisily from a sedentary position. When he was practising at the Bar, he would not have behaved like that in the courts. Due decorum should be observed by the hon. Gentleman.

[Debbie Abrahams (Oldham East and Saddleworth) (Lab)]

This Government’s handling of the proposed changes to legal aid has been absolutely shambolic. Not only are they proposing to restrict access to legal aid—a right that goes back to Magna Carta—but their proposal will actually cost more. When will the Minister get a grip?

[Chris Grayling]

Sometimes, Mr Speaker, you have to pinch yourself when you hear Labour Members. It is true that we are going to limit access to legal aid to people who have a net disposable income of more than £3,000 a month after tax, national insurance, mortgage payments, food, council tax, and child care. My view is that if people have that much disposable income, they can make a contribution. Labour is only a party for the rich these days.

[Mark Menzies (Fylde) (Con)]

16. What assessment he has made of recent trends in the development of judicial review.

--- Later in debate ---

[Kelvin Hopkins (Luton North) (Lab)]

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

[The Lord Chancellor and Secretary of State for Justice (Chris Grayling)]

My hon. Friend the Member for Bury North (Mr Nuttall) has already referred to the new prison in north Wales, and I thought it might be helpful to update the House on our plans. The purpose-built institution that we are planning will hold about 2,000 prisoners and bring about 1,000 jobs and a £23 million boost each year to the region’s economy. We expect work to start on the build in summer next year, with the aim of being fully operational by late 2017.

I want to put on record my thanks to the Welsh Government and the local authorities in the region for their co-operation in helping this, the first prison in north Wales, to become a reality. We will announce the specific set of sites in due course. I believe that this is the right thing for this part of the country and the right way to meet prison capacity demands. New prison builds represent much better value for money for the taxpayer, but as the recent report from Policy Exchange recognised, they are also the right way for us to cut this country’s stubbornly high reoffending rate. That is another reason why the announcement of this Government investment is such welcome news.

[Kelvin Hopkins]

Only two years ago the probation service was awarded the British Quality Foundation Gold Medal for Excellence and was lavishly praised by the then responsible Minister, who was later sacked to be replaced by hard-line privatisers who are now determined to force more public money into private pockets, whatever the consequences. Is not that the simple truth?

[Chris Grayling]

It is important that Labour Members understand what they are saying when they oppose these reforms. Every day of every week, a young person, very often somebody who has grown up in the most difficult circumstances and found themselves with a short sentence in jail, is walking back on to our streets with £46 in their pocket and no support, and the majority reoffend. That is a scandal, it needs to stop as quickly as possible, and that is what we are aiming to do.

[Mr Gary Streeter (South West Devon) (Con)]

T2. May I commend my right hon. Friend for his courage in trying to tackle the legal aid budget, which certainly does need to be addressed, and thank him for the genuine consultation exercise on which he has embarked? May I gently suggest to him that, in particular, the plans for large criminal law legal aid contracts in rural areas need to be looked at? I am concerned about the decimation of specialist firms in Plymouth. I support his approach, but could he please look again at that issue?

[Chris Grayling]

I can give that assurance. As I said a moment ago, this is one of the things that has come out of the consultation—it is a genuine consultation, although I know that Labour does not believe that it should be genuine—and we are listening and I will review it over the next few weeks.

[Sadiq Khan (Tooting) (Lab)]

And all said with a straight face!

It is a statement of fact that the Justice Secretary’s plans for the probation service will lead to serious sexual and violent offenders being supervised by the likes of Olympic security and Work programme experts G4S, A4e and others. Why has he refused my freedom of information request to see the risk register for these plans?

[Chris Grayling]

Labour simply will not accept the need for change and for those under-12-months prisoners to be supervised. As the right hon. Gentleman knows, when his party was in government he did not publish risk registers, either. This is another example of Labour doing one thing in government but wanting the rules to change the moment it moves into opposition. It is very unedifying.

[Sadiq Khan]

May I gently advise the Justice Secretary to seek advice from the Leader of the House, the former Secretary of State for Health, about how that movie ended for him?

The rest of us saw leaks of the risk register in last week’s media. What would the risk register need to say for the Justice Secretary to change his plans, or does he really not care?

[Chris Grayling]

Again, the right hon. Gentleman has conveniently forgotten what the purpose of a risk register is: it is a management document designed to ensure that we look at all the issues a project should address when formulating its plans and that we take the necessary steps to ensure that the process runs smoothly. That is what we are doing, and we are doing it because there is a large group of mostly young people on our streets who are likely to reoffend and have no support at all at the moment. I think that that is a problem worth sorting.

[Sir Nick Harvey (North Devon) (LD)]

T3. May I pursue a little further the point made by my hon. Friend the Member for South West Devon (Mr Streeter) about the impact of these legal aid changes in rural communities? Does the Secretary of State recognise that in remote communities like my North Devon constituency all this work is currently undertaken by small firms that will not be big enough to tender for contracts, and that if they are not able to keep the critical mass of work in this area, they will not be there to be subcontracted to by bigger firms? How far will my constituents have to go for legal representation in the future?

[Chris Grayling]

We need to ensure two things. We have to bring down the cost of criminal aid, so no change is not an option. We have consulted on a package of proposals and there will have to be change in the solicitors sector. The Law Society itself accepted that in a letter to the Select Committee yesterday. However, as I have said, one of the issues that arose from the consultation related to rural areas and we will consider it very carefully.

[Jeremy Corbyn (Islington North) (Lab)]

T4. In answer to questions asked by my hon. Friend the Member for Glasgow North East (Mr Bain) and others a few minutes ago, the Secretary of State and his colleagues were less than clear about the European convention on human rights. Which part of it do they object to and want to change, and are there plans to leave the convention altogether?

--- Later in debate ---

[Andy Sawford (Corby) (Lab/Co-op)]

T6. Is the spoof Twitter account @FailingGrayling a reference to the failing Work programme or to the rushed probation reforms, which are sure also to fail?

[Chris Grayling]

The Work programme is not in my remit now, but Members will have noticed that in the past couple of weeks we have published figures showing that more than 300,000 people have started work through the Work programme and that 132,000 of them have completed lengthy periods in work, all at a fraction of the cost of the programmes that we inherited from the previous Government.

--- Later in debate ---

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

T7. The Conservative party has always claimed to be suspicious of an over-mighty state. Why, then, do the Justice Secretary’s plans for judicial review reform strengthen the role of the state at the expense of the rights of individual citizens?

[Chris Grayling]

I do not believe that anyone should just be able to make a case, find a lawyer and have the initial application paid for. That is what we are going to change.

[Ian Swales (Redcar) (LD)]

T9. In its court translation services, Capita is delivering only 90% compliance against a contract level of 98%. Will the Minister tell the House the overall cost of that failure to the Courts Service and the total amount of the penalties that have been levied on Capita?

[Ian Mearns (Gateshead) (Lab)]

T10. There are significant questions of confidence relating to the Justice Secretary’s plans to privatise courts, not least from the Lord Chief Justice, and the Justice Secretary’s own officials have little confidence in his plans to privatise the probation service. Does anyone in the criminal justice system have any confidence in the Justice Secretary?

[Chris Grayling]

I am grateful to the hon. Gentleman for giving me the chance to make it clear that I have no plans to privatise the Courts Service. I have every intention of giving it additional commercial freedoms so that it is able to charge a proper rate from those who can afford to pay it. For example, when Russian oligarchs come to London to use our courts, it is right and proper that they should pay a significant amount for the job, as well as their substantial legal fees. I am sorry to hear that the Labour party is championing low bills for the rich and not the right job for this country.

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

Will the Secretary of State refute again the ridiculous scare stories? Does he agree that even combined courts in the counties can be more flexible, efficient and innovative, and that any talk of privatisation is ridiculous?

[Chris Grayling]

My hon. Friend is absolutely correct. What we are hearing from Opposition Members throughout this sitting is that they are the same old Labour party: they have no answers to any of the problems, they oppose any change and they oppose savings. Frankly, they are not fit to be an Opposition, let alone a Government.

[Ann Coffey (Stockport) (Lab)]

The appointment of registered intermediaries is an underused special measure for child witnesses. Because children do not hear or understand language in the same way as adults, they can find cross-examination very confusing. What more can Ministers do to encourage the appointment of registered intermediaries to help children give good quality evidence in court?

[Duncan Hames (Chippenham) (LD)]

I understand the need to bear down on costs that is driving the Lord Chancellor’s legal aid reforms. Given the disproportionate cost of defending corporate fraud cases, will he consider other ways to make savings, such as requiring those costs to be met out of companies’ public liability insurance?

[Chris Grayling]

I am all in favour of making anyone involved in our court system make greater use of insurance, as they do in Germany. However, it is a difficult place to get to if we are asking victims of crime to contribute to the cost of prosecuting that crime.

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

Further to Topical Question 1, will changes to the probation service mean that reoffending rates rise or fall? I am not asking for another paean for privatisation—will reoffending rates be cut or will they rise?

[Chris Grayling]

Evidence from where we have put such changes into practice in Peterborough—we have just published the first findings of the kind of mentoring approach I am talking about—shows a noticeable drop in the level of reoffending. I am confident that the reforms will deliver that. It is much needed.

[Graham Evans (Weaver Vale) (Con)]

What plans does my right hon. Friend have to improve the number of court cases that go ahead on the day that has been scheduled, in order to reduce the upset caused to victims and witnesses?

[Fiona Mactaggart (Slough) (Lab)]

Will the Secretary of State promise the House that if he were to close a women’s prison, he would ensure that some of the savings that arose went towards preventing women from going into prison in future?

[Chris Grayling]

The answer is yes. Our probation reforms will also involve greater mentoring support for those who receive community sentences. Our aim is to stop people going to prison in the first place, and help prevent them from going back if they do end up in prison.

[Gavin Barwell (Croydon Central) (Con)]

My constituents expect prison to be a place of punishment and rehabilitation, not to provide a more comfortable lifestyle than the one inmates enjoy on the outside. Will the Minister explain how the incentives and earned privileges scheme will operate in the new prison planned in north Wales, and say whether daily life will be significantly different from elsewhere?