House of Commons

Wednesday 2nd June 2010 Commons Chamber

Wednesday 2 June 2010

The House met at half-past Two o’clock

Prayers

Wednesday 2nd June 2010 Commons Chamber

[Mr Speaker in the Chair]

Member Sworn

Wednesday 2nd June 2010 Commons Chamber

The following Member took and subscribed the Oath required by law:

Anne Caroline Ballingall McIntosh for Thirsk and Malton

Oral Answers to Questions

Wednesday 2nd June 2010 Commons Chamber

The Secretary of State was asked—

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

1. What mechanism he plans to use to review the value for money of his Department’s expenditure.

[The Secretary of State for International Development (Mr Andrew Mitchell)]

We will fundamentally change the way in which we look at the value for money of aid, moving from a focus on inputs to what our money achieves—the outputs and outcomes we secure. We will gain maximum value for money for every pound through greater transparency, rigorous independent evaluation and an unremitting focus on results.

[Stephen Metcalfe]

May I take this opportunity to welcome my right hon. Friend to the Dispatch Box and to congratulate him on his new and important role? I am sure that Members on both sides of the House recognise the important work he has done and will wish him well in these very difficult economic times. Will he reassure the House and my constituents that value for money will be at the heart of his Department’s vital work in tackling poverty in the poorest countries in the world?

[Mr Mitchell]

I thank my hon. Friend for his kind remarks. As I look around the House, I see Members on both sides who are passionate and knowledgeable about international development. I look forward to building on the progress made by the previous Government on this important agenda and I pay tribute to my predecessor, the shadow Secretary of State, the right hon. Member for Paisley and Renfrewshire South (Mr Alexander), for his work in particular on international aid effectiveness and co-ordination.

In respect of my hon. Friend’s question, value for money will be at the heart of everything we do. We are examining all expenditure in every single country, starting with our country review shortly.

[Mr Douglas Alexander (Paisley and Renfrewshire South) (Lab)]

With your permission, Mr Speaker, let me return the compliment offered to me by the Secretary of State by extending my congratulations to him and his team of Ministers. The Department for International Development is one of Labour’s proudest achievements and I wish him well in his stewardship of that important Ministry. I welcome the answer that he just gave emphasising value for money. May I ask whether he regards educating young girls in Afghanistan as a valuable part of that comprehensive approach or whether he agrees with the Defence Secretary that it is simply

“education policy in a broken 13th-century country”?

[Mr Mitchell]

I thank the shadow Secretary of State for his kind remarks. It is a tremendous advantage in the House and outside it that international development is regarded as a British policy and not a policy of any one of the three main political parties. On his point about education in Afghanistan, education is vital to the future of Afghanistan and to building the capacity of that state. He will know that we now have more than 2 million girls in education in Afghanistan.

[Mr Alexander]

I welcome the fact that the Secretary of State may have achieved the forced re-education of the Defence Secretary on the issue of value for money in DFID expenditure. Has he also secured the re-education of the new Secretary of State for Scotland, the hon. Member for Berwickshire, Roxburgh and Selkirk (Michael Moore), who, according to correspondence that has now come into my possession, described as recently as 20 April “the very real danger” of Conservative proposals to divert aid to military control? Who has got it wrong—the Secretary of State for International Development or the Scottish Secretary?

[Mr Mitchell]

I am afraid that I cannot comment on leaked documents that the shadow Secretary of State has got. On his first point about the Secretary of State for Defence, perhaps I could draw his attention to the press conference that was given in Kabul by me and my right hon. Friends the Secretary of State for Defence and the Foreign Secretary. If the right hon. Gentleman looks carefully at the text of that press conference, he will see that one could not get a cigarette paper between my views and those of the Secretary of State for Defence.

[Tony Baldry (Banbury) (Con)]

May I just say how delighted we all are to see my right hon. Friend and his colleagues on the Treasury Bench? They are a fantastic team: he did brilliant work in opposition, and I am sure that he will do brilliant work in government.

However much value for money my right hon. Friend manages to get out of his Department, our colleagues in the G8 must also do their bit. The UK has met the targets that we set ourselves at Gleneagles, but does he not find it a matter of concern that France, Germany and Italy are so substantially lagging behind what they promised at Gleneagles that they would do to meet those targets?

[Mr Mitchell]

My hon. Friend is right that everyone who signed up to those commitments at Gleneagles in 2005, in front of the international cameras of the world, must honour them. We will be at pains to make it clear that the vital development budget, which is so important, should be supported by all the G8 countries. It is difficult to probe and indeed question countries in the developing world that do not live up to their commitments to their people if countries of the G8 do not live up to the solemn commitments that they too have made in front of the world.

[Mr Tom Clarke (Coatbridge, Chryston and Bellshill) (Lab)]

2. What recent assessment he has made of the humanitarian situation in Sudan; and if he will make a statement.

[The Secretary of State for International Development (Mr Andrew Mitchell)]

The British Government are deeply concerned by the humanitarian emergency in Sudan. Recent fighting, particularly in Darfur and southern Sudan, is causing further suffering and displacement. In 2010, we will provide emergency food, medicine, shelter, water and sanitation for up to 5 million people. We continue to urge the Government of Sudan and rebel movements to improve access and security for humanitarian workers.

[Mr Clarke]

In congratulating the right hon. Gentleman on his appointment, may I ask that he assures the House that, as a priority, this Government will continue to focus on Sudan? Will he bring the House up to date by giving us his assessment of the current situation in east Sudan?

[Mr Mitchell]

I thank the right hon. Gentleman for his comments, and I pay tribute to his consistent work on Sudan over recent years. He will be aware that nearly 300,000 people have died in Darfur as a result of this emergency: 2 million people are displaced, 2.4 million are on food aid, and fighting is still going on in Jebel Mara and Jebel Moon. He will also be aware that this conflict has internationalised itself across the border into Chad, where there are already 250,000 Sudanese refugees, as well as into the Central African Republic.

Tomorrow, the UN emergency relief co-ordinator will brief the UN Security Council on his recent visit. The British Government will look carefully at what he says about the humanitarian situation in Sudan, and consider whether further action is necessary.

[Mark Pritchard (The Wrekin) (Con)]

I congratulate my right hon. Friend on his appointment to the Cabinet. What is Her Majesty’s Government’s view on next year’s national referendum? He will no doubt have taken soundings from Ministers throughout Europe. It is absolutely vital that the referendum is undertaken in the correct way, in order to bring stable Government so that we can see that humanitarian relief and aid are put in the right place.

[Mr Mitchell]

My hon. Friend is absolutely right about the critical importance of the referendum on the border between southern and northern Sudan, and we are watching the position extremely carefully. He will be aware that the situation in Darfur that I have described is in many ways mirrored by what is going on in the south, where he will know that there has been an acute rise in food shortage and where more than £70 million of British humanitarian relief is going in this year. I can give him the undertaking that we will continue to work hard to ensure that the referendum is conducted freely, fairly and successfully, and that we are prepared for the results.

[Mr Gareth Thomas (Harrow West) (Lab/Co-op)]

I add my own congratulations to the right hon. Gentleman, and send best wishes to him and his team—for now. Given that we are still a long way from meeting the millennium development goals, particularly in Sudan, how will he and his colleagues use the remaining four months before the UN’s poverty summit to help rebuild the international momentum needed to achieve the goals? Will not one telling signal of the new Government’s willingness to show leadership on this issue be whether they bring forward legislation to put the UN’s aid target of 0.7% on the statute book before that September summit?

[Mr Mitchell]

I thank the hon. Gentleman for his warm wishes for now. On the second part of his question, he will have seen in the coalition document that we are committed to enshrining in legislation our commitment to an aid target of 0.7 % of gross national income by 2013. If he will bide his time in patience, he will see that that is precisely what we will do. On his first point about the critical importance of taking forward the agenda on the MDGs, which is so off-track at present, he will be interested to hear that the Prime Minister will meet the Prime Minister of Canada tomorrow to discuss the approach of the G8 to the MDGs. In particular, in respect of MDG 5 concerning maternal mortality, which is so off-track, we have specific plans to try and give that a boost.

[John Howell (Henley) (Con)]

3. What his Department's policy is on the provision of aid to the Russian Federation; and if he will make a statement.

[Greg Hands (Chelsea and Fulham) (Con)]

10. What his policy is on the provision of aid to the Russian Federation.

[The Minister of State, Department for International Development (Alan Duncan)]

DFID’s bilateral project work in Russia totalled £1.5 million in 2009-10 and is estimated to be some £1.4 million in 2010-11. The new Government will wind down bilateral spending in Russia as soon as is practical and responsible.

[John Howell]

I thank the Minister for his response and offer my congratulations to him on his position. Those of us who have been involved in our commercial careers in Russia would certainly agree that giving aid to such a prominent G8 country could risk confidence in the aid programme as a whole, but Russia still has a long way to go in developing a full civil society. Will the Minister look at how non-governmental organisations in Russia working towards civil society might be encouraged to do their job?

[Alan Duncan]

I thank my hon. Friend for his kind words. I am well aware of his work in the past on the know how fund and I appreciate his continuing interest in the matter. As I said, we intend to wind down bilateral aid to Russia in an orderly way. Ministers and officials regularly discuss with Russia both bilaterally and as part of the EU a range of issues, including human rights and freedom of expression. We remain committed to maintaining our dialogue with Russia as a donor colleague in the global effort to provide good quality aid.

[Greg Hands]

Further to that answer, will my hon. Friend also consider moving the aid that has been going to Russia to Russia’s former satellites in central Asia? For example, in Tajikistan more than 1 million people are living on less than $1 a day, and five years on from the Andijan massacre, Uzbekistan is desperately in need of help for rebuilding civil society and democratisation.

[Alan Duncan]

As I said, we intend to wind down bilateral aid to Russia in an orderly way, and we are carrying out a review of all bilateral programmes so that we can better prioritise the United Kingdom’s development assistance. At this stage in the review, I cannot make commitments to increase aid in the areas that my hon. Friend proposes, but I am happy to take his comments on board.

[David Cairns (Inverclyde) (Lab)]

I welcome the hon. Gentleman to his post. A moment ago he mentioned raising the issue of human rights with the Russians. He will be aware of the disgraceful and homophobic comments of the mayor of Moscow in his various attempts to ban gay rights marches in Moscow. What message can the Minister take to the Russians and to all the recipients of UK aid money that such disgraceful homophobic attacks and oppression will not be tolerated?

[Alan Duncan]

The hon. Gentleman may be surprised to know that that is the one homophobic comment of which I had not been fully aware. I am usually well on top of these matters. We take human rights issues in Russia very seriously and they will continue to be an important part of the dialogue between our diplomats and members of the Foreign Office and our Russian counterparts.

[Pauline Latham (Mid Derbyshire) (Con)]

4. What steps he is taking to ensure maximum transparency in the distribution of aid under his Department’s programmes.

[The Secretary of State for International Development (Mr Andrew Mitchell)]

The public in the UK and in the countries where we work have a right to access information about the aid that we provide. We will introduce full transparency in aid and publish details of all UK aid spending online, increasing the range and extent of the information published.

[Pauline Latham]

I congratulate my right hon. Friend and his team on the jobs that they are to do, because I know that they are all passionate about the subject. Will the Secretary of State please let the House know that the benefits of the increased transparency will extend not just to UK taxpayers, but to the poor of the countries that the aid is intended to help?

[Mr Mitchell]

My hon. Friend knows a great deal about these issues from her experience, not least in Uganda, and I thank her for her question. She is quite right about the importance of transparency, enabling people in poor countries to hold their own politicians to account, and it is a very important aspect of both transparency and our development budget that we help build up the capacity of civil society in countries that we are assisting so that they can do just that.

[Ann McKechin (Glasgow North) (Lab)]

Given the increasing importance of the European Union in aid funding, does the Secretary of State agree that there needs to be greater harmonisation of aid priorities within the EU?

[Mr Mitchell]

The hon. Lady makes an important point about the EU aid programme, which, as she knows, is conducted in two different ways—through own resources and through the European development fund. I had the opportunity of speaking to the commissioner who is responsible for these matters last week about the importance of aid effectiveness and transparency in the EU. There may be a case in some aspects of the programme for greater harmonisation, and we will always look at that through the prism of greater effectiveness.

[Mark Lancaster (Milton Keynes North) (Con)]

I commend my right hon. Friend for the proactive approach that he is taking in ensuring that the UK takes the lead in providing greater transparency, but does he agree that it is equally important that our international partners follow suit, and, if so, could he share with the House how he intends to encourage them to do so?

[Mr Mitchell]

As my hon. Friend will be aware, this is an important aspect of the work that we intend our newly established, or to be established, independent evaluation programme to champion. An independent evaluation is not only about looking at the money that we spend from DFID, it is also about looking at how British taxpayers’ money is spent through the multilaterals and some of the brilliant non-governmental organisations that we are funding. All of them need to be subject to the same independent audit so that we ensure that we get value for money for the hard-pressed taxpayers who are providing it.

[Mr Gregory Campbell (East Londonderry) (DUP)]

The Minister may be aware of the incredibly good work that many charities and church-based groups are carrying out in east Africa, particularly in regard to transparency and combating corruption there. Will he try to understand and take information from those charitable groups and ensure that that is replicated in the aid that goes to that region?

[Mr Mitchell]

The hon. Gentleman is absolutely right in the importance that he attaches to the work of some of these brilliant NGOs, not only in the part of Africa that he mentioned, but all around the world, which during the last four years I have had the privilege of seeing in action. We have every intention of introducing a poverty impact fund targeted precisely at enabling such charities to double the output of what they are producing, and I will be able to give the House further details of that in due course.

[Tony Lloyd (Manchester Central) (Lab)]

5. What assistance his Department is providing for research into the treatment of malaria.

[The Parliamentary Under-Secretary of State for International Development (Mr Stephen O'Brien)]

The Government are committed to a significant increase in our support to help reduce the terrible scourge of over 800,000 known deaths from malaria each year—all of which are preventable. Research is essential to develop new drugs and tools and identify the best way to deliver them in a cost-effective way, and will play a part in our meeting this commitment as we increase our focus and activity on malaria.

[Tony Lloyd]

In welcoming the Minister to his place at the Dispatch Box, may I offer my congratulations to the Secretary of State who got into the Conservative party manifesto a commitment to £500 million spending per year on malaria, which in particular includes research into a malaria vaccine? Does that commitment still stand, because it will gain support on both sides of the House?

[Mr O'Brien]

I am very grateful to the hon. Gentleman for his kind remarks, and he is aware that we are committed to spending up to £500 million as he notes, in particular in relation to developing an effective malaria vaccine. Theoretically, there is a real hope of such a vaccine in the future, and we believe that vaccine research therefore plays in important part, but at the same time should not detract from the need to get better at delivering what we know works now. Work on a future vaccine will be focused on what will be capable of being safely delivered, accessible to the poor and with sufficient efficacy to be one of the key tools in the armoury that will continue to have to be used in the battle against malaria.

[Andrew George (St Ives) (LD)]

Further to that answer, what commitment can the Minister give to the Government’s approach to the talks on the replenishment of the Global Fund to Fight AIDS, Tuberculosis and Malaria, which will take place in September?

[Mr O'Brien]

I am very grateful to the hon. Gentleman for his question. He will be aware that that issue is currently being considered, and we are looking at all the representations received not only to work towards a negotiation of the replenishment of the Global Fund to Fight AIDS, Tuberculosis and Malaria, but most importantly to build on the very good work that that fund, which is now the world’s largest health fund, has already demonstrated to date.

[Mr Virendra Sharma (Ealing, Southall) (Lab)]

6. What proportion of his Department’s aid to Pakistan was intended for minority groups in the federally administered tribal areas of Pakistan in the last 12 months.

[The Secretary of State for International Development (Mr Andrew Mitchell)]

Of £140 million in assistance to Pakistan between April 2009 and March 2010, my Department provided £40.2 million in humanitarian aid for people displaced by conflict in federally administered tribal areas and Khyber Pakhtunkhwa province. The UK’s humanitarian assistance targets those most in need, regardless of population group, following internationally agreed principles of neutrality and impartiality.

[Mr Sharma]

I thank the Secretary of State for his response, and I add my congratulations to him on his appointment as Secretary of State and to his team. Does he agree that it is not only essential to win hearts and minds among the general populace, but vital to try to assist minority groups in those regions through our aid efforts?

[Mr Mitchell]

I thank the hon. Gentleman for his question and underline the point that I made in my answer—that our humanitarian assistance targets those most in need, following internationally agreed principles of neutrality and impartiality. I can tell him that I shall shortly be going to Pakistan, and I shall look very specifically at the point that he has made. I can tell him also that since the 2008 conflict, the UK has given humanitarian support, providing shelter, food, health care, clean water and sanitation in order to help people recover their livelihoods when they return to their home. I know that that has been a matter of concern to him.

[Jim Sheridan (Paisley and Renfrewshire North) (Lab)]

7. What steps he plans to take to ensure that projects to prevent female genital mutilation have access to internet-based funding programmes.

[The Parliamentary Under-Secretary of State for International Development (Mr Stephen O'Brien)]

The Government condemn female genital mutilation as an extreme violation of women’s and girls’ human rights. An estimated 140 million women and girls have been subjected to that practice. Internet-based funding, such as GlobalGiving, is increasingly helping civil society organisations to access funding for programmes to prevent female genital mutilation. We will look at that area over the next year as we design the poverty impact fund, which will support innovative ways of working.

[Jim Sheridan]

Genital mutilation is condemned by most humanitarian organisations, so how does the Minister plan to ensure that his “My Aid” programme will not disadvantage unpopular programmes? As I understand it, his party’s green paper says that if 25% of people vote for Malawi, that country’s programme will get 25% of the funding. But how will he protect vital programmes that do not have the X factor and do not receive an internet vote?

[Mr O'Brien]

I am very grateful to the hon. Gentleman for identifying the key issue of FGM. We will certainly consider carefully what he has said, as we look to roll forward the programmes, in order to ensure that we deal in the most effective way by bearing down not only on the activity, which is clearly intolerable, but on the societal and cultural drivers that lie behind it. That is what will be most influential in driving the funds to help the programmes.

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

9. What steps he is taking to ensure maximum effectiveness in respect of the aid provided under his Department’s programmes.

[The Secretary of State for International Development (Mr Andrew Mitchell)]

It is essential that we spend every pound of aid effectively. We will do that through rigorous independent evaluation, greater transparency and an unremitting focus on results. We will transform the transparency of aid information, ensuring accountability to UK taxpayers and people in developing countries. The UK will review all aid to focus it on results and on outputs.

[Mr Ellwood]

I am grateful for that reply and welcome my right hon. Friend to his new appointment. He stressed that Afghanistan is our main foreign challenge. How will he ensure that the money that is poured into Ministries in Kabul is able to make its way all the way down to the front line—to those communities that need it most?

[Mr Mitchell]

I am grateful to my hon. Friend, who knows a great deal about those issues. We have looked very carefully at the mechanism for delivering that aid, which is vital to the development effort in Afghanistan, and independent analysis suggests that the World Bank trust fund, which, as he will appreciate, pays out on the basis of receipts for work carried out by the Government and Government employees, is a highly effective way of getting money through to the front line.

[Mr Gordon Marsden (Blackpool South) (Lab)]

12. What recent assessment he has made of the effectiveness of his Department’s work to promote stability and the development of civil society in the Caucasus.

[The Minister of State, Department for International Development (Alan Duncan)]

DFID no longer has bilateral aid programmes in the Caucasus region. The UK Government’s conflict prevention pool, including civil society support, remains active in the region. The UK also continues to support development in the Caucasus region through its membership of multilateral institutions, including the EU.

[Mr Marsden]

I thank the Minister for his reply. Does he agree that given the continued progress towards a resolution of conflicts in the region, particularly in respect of Nagorno-Karabakh, it is very important that, at a multilateral and primary level, the Government give support to those sorts of activities?

[Alan Duncan]

We will look very closely at the hon. Gentleman’s representations in the context of all the reviews that we are currently making.

The Prime Minister was asked—

[Mr Douglas Carswell (Clacton) (Con)]

Q1. If he will list his official engagements for Wednesday 2 June.

[The Prime Minister (Mr David Cameron)]

I am sure that the whole House will wish to join me in paying tribute to the soldiers who have died in Afghanistan in the last week: from 40 Commando Royal Marines, Corporal Stephen Curley and Marine Scott Taylor; and from the 4th Regiment Royal Artillery, Gunner Zak Cusack. These were men of outstanding courage, skill and selflessness. We must never forget their sacrifice.

The House will also be alarmed and shocked by the events unfolding in Cumbria today. Police were called to Whitehaven at 10.35 this morning after shots were fired by a man, and I regret to report that a number of people have been shot and at least five people have died. I can confirm that the body of a gunman has been found by the police. The chief constable of Cumbria is working closely with other forces and other emergency services to ensure a co-ordinated response to these rapidly moving events. The Government will do everything that they possibly can to help the local community and those affected, and to keep the House informed. A full statement will be made to Parliament tomorrow. When lives and communities are suddenly shattered in this way, our thoughts should be with all those caught up in these tragic events, especially the families and friends of those killed or injured.

[Mr Carswell]

All parties in this House will welcome the coalition’s proposals to eliminate quangos and shift power away from unelected functionaries to elected representatives. The biggest quango of the lot is, of course—[Hon. Members: “The House of Lords.”] It is the other place, a legislative Chamber largely appointed by the Executive. Will my right hon. Friend confirm that he will bring forward proposals in the next 12 months to make all our law-makers accountable through the ballot box?

[The Prime Minister]

I am grateful to my hon. Friend for asking that question. I do not always give him answers that make him happy, but this time I can. There will be a draft motion, by December, which the House can vote on. I have always supported a predominantly elected House of Lords, and I am delighted that agreement has been reached on the coalition programme. [Interruption.] I can already hear what a challenge around the House it is going to be to achieve the consensus that we need, but I hope that after all the promises of reform, this time we can move towards a predominantly elected second Chamber.

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

I join the Prime Minister in paying tribute to Corporal Stephen Curley and Marine Scott Taylor from 40 Commando Royal Marines, and to Gunner Zak Cusack from the 4th Regiment Royal Artillery. As the Prime Minister said, they were brave men who died in the service of our country. We must never forget the sacrifice that they made.

I strongly support what the Prime Minister has said about the dreadful shootings in Cumbria. We offer our deepest sympathies to the families of those who have been killed and our strong support for the police, the emergency services and the local communities in Cumbria.

May I ask the Prime Minister about the Israeli interception of the Gaza flotilla? I am sure that he agrees that there has been a tragic loss of life, which has angered the Palestinians and dismayed friends of Israel, too. Can he tell the House what is the current position of the British nationals who have been detained by the Israelis? Will he tell us how the Government can contribute to international efforts to make the Israelis recognise that the blockade of Gaza is prolonging the suffering of the Palestinians and making peace in the middle east even harder to achieve? This blockade must end.

[The Prime Minister]

I thank the right hon. and learned Lady for what she said about our troops, and also for raising the issue of the events off the coast of Gaza. What has happened is completely unacceptable; we should be clear about that. We should also deplore the loss of life. Indeed, I have spoken to the Prime Minister of Turkey to extend our condolences for the Turkish citizens who have been lost. We should do everything we can to make sure this does not happen again; I stressed this point in a conversation with Prime Minister Netanyahu of Israel.

In answer to the right hon. and learned Lady’s specific questions about British nationals, 42 British nationals are caught up in this. I believe that around 37 of them have had consular access and that all of them will be coming home, and we need to make sure that they are reunited with their families as fast as possible.

The right hon. and learned Lady also raised the issue of international efforts to get the blockade open. As she knows, and as the shadow Foreign Secretary will know, we should do everything we can through the United Nations, where resolution 1860 is absolutely clear about the need to end the blockade and to open up Gaza. I would say in addition that friends of Israel—and I count myself a friend of Israel—should be saying to the Israelis that the blockade actually strengthens Hamas’s grip on the economy and on Gaza, and it is in their own interests to lift it and to allow these vital supplies to get through.

[Ms Harman]

I thank the Prime Minister for that answer, and I know that we will be hearing more from the Foreign Secretary in a statement immediately after these questions.

Can the Prime Minister give me an answer on another important issue—one that I raised with him last Tuesday—about prosecuting rape? We know that it is often only after many rapes that a defendant is finally brought to court, and it is often only at that point that previous victims find the courage to come forward. By making rape defendants anonymous, he is going to make it harder to bring rapists to justice.

[The Prime Minister]

I know that the right hon. and learned Lady cares very deeply about this issue, as do I. The fact that rape convictions are so low in this country is a scandal, and we need to improve on that. That means working with the police, and also doing more to help rape victims, including backing rape crisis centres.

On the issue of anonymity, I sat on the Home Affairs Committee that examined this issue; it was of course a Committee in a previous Parliament, dominated by Labour Members, and very ably chaired by Chris Mullin. We came to the conclusion that there was a case for saying that between arrest and charge there was a case for anonymity. The coalition agreement mentions the issue of anonymity, and we will of course be bringing forward proposals, which the House can then examine and debate. I think that there is a case for this to happen, but I understand what the right hon. and learned Lady says—that it is important that the publicity around a case can help to bring forward other people who have been raped. I understand her case, but I think that this does represent a good way forward.

[Ms Harman]

I welcome the Prime Minister’s recognition of the first point. However, does he not also recognise that to single out rape defendants, which is what he is proposing to do, sends a very powerful message to juries in rape cases that the rape victim is not to be believed, and sends a devastating message to rape victims that, uniquely of all victims, they are not to be believed?

[The Prime Minister]

I do not accept that. The Home Affairs Committee looked at this very carefully and came to conclusion that in this case there was a case for extending anonymity, also because in rape cases, obviously, those who have been raped have anonymity themselves, and that was the case with this limited extension. We will be bringing forward proposals that can be debated and discussed in the House of Commons. We all want the same thing, which is to increase the number of successful rape prosecutions and to send more rapists to jail: that is what this is about.

[Ms Harman]

I am sorry, but I think that that is a disappointing answer, because the Prime Minister shows no understanding of the progress that has been made on prosecuting rape, and he does not realise how seriously this will turn the clock back.

May I turn to another subject that I believe the Government should reconsider—the married man’s tax allowance? It would go to only one in three married couples, and would cost half a billion pounds a year. Can the Prime Minister tell the House how that would contribute to cutting the deficit?

[The Prime Minister]

I am an unashamed supporter of families and marriage, and I simply do not understand why, when so many other European countries—I remember often being lectured when I was on the other side of the House about how we should follow European examples—recognise marriage in the tax system, we do not. I believe that we should bring forward proposals to recognise marriage in the tax system. Those in our happy coalition will have the right to abstain on them, I am happy to say, but I support marriage. We support so many other things in the tax system, including Christmas parties and parking bicycles at work, so why do we not recognise marriage?

[Ms Harman]

The Prime Minister knows that this will not keep couples together; he is just hoping that it will keep his Back Benchers on side. He has not answered the question: how will this planned tax cut help reduce the deficit?

[The Prime Minister]

If we are going to get control of public spending in the long term in this country, we should target the causes of higher spending, one of which is family breakdown. We should do far more to recognise the importance of families, commitment and marriage—and let me just say that any recognition of marriage that we put in the tax system will also be recognition of civil partnerships, because commitment is important, whether someone is straight or gay.

[Ms Harman]

So the Prime Minister is seriously saying that he expects us to believe that he thinks a £3 a week tax break, which will cost the Exchequer half a billion pounds a year, will keep families together. No wonder the Deputy Prime Minister is sitting so quietly by his side—because on this one, Nick agrees with me. We do not need it, it will not work, and they should drop it.

[The Prime Minister]

I am afraid the right hon. and learned Lady has a slightly short memory, because when she was sitting over here on the Government Benches, an enormous recognition of marriage in the tax system was introduced by the Labour Government in—wait for it—inheritance tax. [Hon. Members: “Oh!”] Yes, they massively increased the threshold for inheritance tax that can be transferred between husband and wife. If recognising marriage in the tax system is such a good thing for the better-off, why do we not do it for the less well-off? [Interruption.]

[Mr Speaker]

I call Sir Alan Beith.

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

rose—[Interruption.]

[Mr Speaker]

Order. I know that the House wishes to hear Sir Alan Beith.

[Sir Alan Beith]

May I associate my right hon. and hon. Friends with the tributes that the Prime Minister paid to those who have lost their lives in Afghanistan and in the dreadful events in Cumbria?

What means does the Prime Minister hope to use to achieve his stated and very necessary objective of allowing the private sector to expand in the parts of the country, such as the north-east, that depend heavily on public sector jobs?

[The Prime Minister]

The right hon. Gentleman raises an extremely important issue, because we will have to take difficult decisions about public spending; everybody knows that. Let me be clear: no region of the country should be singled out, but he is right to say that some parts of the country have a very high dependence on public sector jobs. In the Budget on 22 June we will need to bring forward ideas that will fire up the private sector—for instance, the idea that any new firm established does not have to pay national insurance for the first 10 employees. I think that will help, but the right hon. Gentleman is right to say that we should also think about ways in which, as we get the private sector growing and make difficult decisions in the public sector, we can help regions that could be adversely affected. The Government are looking seriously at that idea, because we want to take the whole country with us as we deal with the £160 billion deficit bequeathed to us by the Opposition.

[Chris Bryant (Rhondda) (Lab)]

Q2. I wholeheartedly support what the Prime Minister said earlier about our armed forces, not least because a lot of young men and women from the Rhondda and the other south Wales valleys are serving in Afghanistan and elsewhere at the moment. He will know that one of the most important things for protecting our armed forces is ensuring that they have the best training possible, technically and in military expertise. Will he therefore commit himself and his Government unambiguously today to the new defence training college in St Athan in south Wales, which would save lives in our armed forces and provide 5,000 jobs in south Wales?

[The Prime Minister]

I am grateful for the hon. Gentleman’s question. Everyone who has spent time in south Wales with the military knows that there is an incredibly strong case for the St Athan defence training establishment. I have heard that case on all the visits that I have made, but he will understand that we must have a proper strategic defence review. We have not had one since 1998, and everything has to be included in that review. I would just say to him, as he feels so strongly about this, that he was in the last Government, and that there was an opportunity to give that project the go-ahead before the election, but they did not do it.

[Mr Adam Holloway (Gravesham) (Con)]

Q3. Now that we know that the last Government spent £1 billion on advertising and “invested” £12,000 in golf balls, is the Prime Minister surprised that there is no money left?

[The Prime Minister]

We are not really surprised, not least because of the letter that we got from the former Chief Secretary to the Treasury. I am glad to see that he has apologised for the letter, although he has not yet apologised for the legacy. My hon. Friend makes a good point. In addition, we have discovered that £320 million was spent on hotels, £1.5 billion on consultants and—this really did amaze me—one Department spent more than £140 per person on cut flowers and pot plants. Perhaps we could have a lottery to find out which one it was.

[Jim Dobbin (Heywood and Middleton) (Lab/Co-op)]

Q4. Four high schools in my constituency are in the last throes of the Building Schools for the Future programme: Matthew Moss high school in Castleton, Siddal Moor sports college, Holy Family—a new joint-faith school—and Middleton technology college in Middleton. Can the Prime Minister guarantee that that programme will be seen through to its completion, which would also help many of the construction workers in my constituency?

[The Prime Minister]

I know that the hon. Gentleman will be pleased to see that in making the £6 billion in-year reductions—many warnings were given about what that would mean—we have protected the schools budget, and ensured that schools and Sure Start are protected. In terms of building schools for the future, let me be clear: our plans—and our passion, when it comes to education—are to ensure that new schools are provided so that we have real excellence, in the secondary sector in particular. That is what it is about. Building schools for the future is exactly what our plans involve.

[Karen Bradley (Staffordshire Moorlands) (Con)]

Is the Prime Minister aware of the case of my constituent Mr Edmond Arapi, who is facing extradition to Italy, having been tried in his absence? Will my right hon. Friend look into the matter urgently and accelerate the review of extradition cases before Mr Arapi is taken from his family and sent to an Italian jail?

[The Prime Minister]

I am happy to look at this case, and I will discuss it with my right hon. Friend the Home Secretary, who is working on the issue of deportations. Legal processes have to be followed, but I will discuss this with my right hon. Friend, and perhaps then contact my hon. Friend.

[Mr Ronnie Campbell (Blyth Valley) (Lab)]

Q5. Now that the banks—some of them, anyway—are coming into profit, and the taxpayers are getting a small return on the enormous amount of money that they put in, when does the Prime Minister envisage selling the shares off to his friends in the City?

[The Prime Minister]

I would much rather sell the shares in the banks to the hon. Gentleman’s constituents. I believe in popular capitalism, and there might be an opportunity to do that. Clearly, important decisions will have to be made to ensure that we get the maximum amount of money back for the taxpayer, who has had to put so much money into the banks, and that we have a fully competitive banking system that serves business in this country so that it does not get ripped off by the banks. At the same time, privatising those banks back into the private sector where they belong can help encourage popular capitalism once again.

[Nadhim Zahawi (Stratford-on-Avon) (Con)]

Q6. Will the Prime Minister join me in congratulating Denys Shortt of Stratford-on-Avon on his nomination as entrepreneur of the year in the Ernst & Young competition—a well-earned accolade? On the question of earnings, was the Prime Minister surprised to learn that so many people in the public sector earn more than he does?

[The Prime Minister]

I join my hon. Friend in congratulating his constituent. Transparency on pay is an important principle, because it is good for democracy and accountability if we know how much people in the public sector are earning. I also think that it will help us to control public spending. When people see how much people are paid in the public sector, the pressure will be on to keep top pay levels down. It would also be worth while having a maximum multiple of 20 times earnings; we are holding a review to get that done. People at the top of a public sector organisation should not earn more than 20 times what people at the bottom earn. It is that sort of progressive idea that we are looking forward to introducing.

[Toby Perkins (Chesterfield) (Lab)]

Q7. Does the Prime Minister share the concerns of two schoolteachers from Chesterfield who came to see me this weekend, that children from areas of greater deprivation will suffer disproportionately from his plans to cut 10,000 university places?

[The Prime Minister]

First, I welcome the hon. Gentleman to his place as the Member of Parliament for Chesterfield. We can all remember one of his predecessors in that seat, Tony Benn, who left this House saying that he wanted to spend more time doing politics.

What I would say to the hon. Gentleman is that we want to help children from less well-off backgrounds by having a pupil premium. We will take money from outside the education budget to ensure that the pupil premium is well funded, so that children from the poorest homes get to go to the best schools and the money follows the pupil into those schools. As for university places, let me say this to the hon. Gentleman: we are expanding the number of university places by 10,000, compared with the legacy that we were left.

[Mr Peter Bone (Wellingborough) (Con)]

May I press the Prime Minister a little further on excessive pay? My constituents are outraged at the amount of money that some senior NHS managers are receiving. What can the coalition do to reduce such excessive expenditure?

[The Prime Minister]

My hon. Friend makes a good point. By having transparency, we are able to see for the first time who is earning what in the public sector. That will create pressure on top people’s pay in the public sector, to keep that pay down. That is the first thing. In the NHS specifically, as he knows, our plans are all about removing the centralised bureaucracy, partly by removing many of the centralised targets that have caused that bureaucracy to grow. Our ambition is to ensure that the priority is the people on the front line—the nurses, the doctors, the people involved in clinical care—instead of the endless increase in management that we have seen in recent years.

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

Q8. Many of my constituents are employed by Nissan and in supply chain jobs. Can the Prime Minister confirm that the £20 million grant awarded to Nissan under the previous Government in March will be honoured, in order to develop the next generation of electric cars?

[The Prime Minister]

Let me welcome the hon. Lady to her place and say that I, too, have visited the Nissan plant near Sunderland. It is an absolute wonder to see the incredible investment that has gone in there and the many jobs that have been created, not just at that plant but in the supply chain. I want to see electric cars being developed, and when I was at Nissan we discussed that specifically. As for the grant, I do not have a specific answer for her—[Hon. Members: “Ah!”] It’s a funny old thing: I’m going to give accurate answers, rather than make them up on the spot. I shall be delighted to let the hon. Lady know via a letter as soon as possible.

[Neil Carmichael (Stroud) (Con)]

Q9. Noting the very high standards of professional care in the NHS in Stroud, may I ask the Prime Minister to lend his support to the Stroud maternity unit?

[The Prime Minister]

I welcome my hon. Friend, and thank him for that question. I understand that the Stroud maternity unit was under threat under a previous Administration, but I am happy to say that with our plans, under which the money in the NHS will follow the decisions that local people make with their doctors about where to be treated, we will find that community hospitals across our country can once again breathe easily.

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

May I associate my right hon. and hon. Friends with the tributes that were paid earlier to our fallen heroes in Afghanistan? We should always remember them. In that spirit, may I ask the Prime Minister, right at the outset of a new Parliament and a new Administration, to give a categorical assurance to our troops that they will always get the equipment and resources that they need on operational duty, to our servicemen and women returning home that they will always get the help and advice that they need to return to civilian life, and to our maimed and wounded that, despite all the budgetary pressures, they will always get the care and compassion that they need and deserve, for however long it takes?

[The Prime Minister]

I thank the hon. Gentleman for his question—and the way that he put it—about ensuring that we protect and help those at the front line with everything that they need, looking after their families and helping those who are injured. That is what our focus should be. It is all those things, and it is all through the lifetime of those people. I have visited places such as Headley Court and seen the incredible work now being done. However, what we have to realise as a country is that this is not just about getting the equipment or renewing the military covenant, so that we serve our armed services properly, but about recognising that the people who have been injured so badly in Iraq and Afghanistan will need a lifetime of help. I do not think that the health service has yet fully woken up to the—quite rightly—very high demands that those people will place on the health services. That is why I have a strong defence team and a strong health team, who are going to work together to ensure that we deliver for those people, who have done so much for us.

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

Q10. What assessment he has made of the effectiveness of NATO’s military strategy in Afghanistan.

[The Prime Minister]

Afghanistan is my top priority. That is why we have set up the National Security Council and why it met on the first full day of the new Government. In terms of the military strategy, we are six months into the troop surge ordered by President Obama. That surge is to provide a proper counter-insurgency campaign, protecting the people while tackling the insurgents. We back that strategy, and we must give it time to work. There are some signs of progress, such as markets opening up again and better district governance. As I said in the debate on the Queen’s Speech, we have to support that military strategy with a political surge, of which the peace jirga being launched in Kabul today is an example. I spoke to President Karzai about this yesterday, and stressed to him the importance of working towards a political solution in which everyone in Afghanistan feels that the Government of Afghanistan are a Government for them.

[Dr Lewis]

Is my right hon. Friend aware of the concept of a sovereign base bridgehead area, which could meet our needs in Afghanistan for a fraction of the cost in life, limb and expenditure? Would he consider taking a briefing on this subject, if possible in the presence of the service chiefs of staff?

[The Prime Minister]

I am grateful to my hon. Friend for asking that question; I know that he has great expertise in this area. I have understood the idea of a bridgehead, but while it is worth examining, there are difficulties with it. The current strategy of counter-insurgency is about trying to protect the public in Afghanistan from the insurgency and enlarge the area of that country in which normal life can continue. What is in our national interest—that is what we should focus on—is an Afghanistan stable and secure enough for us to bring our troops home. That is what we want to achieve. I will listen to my hon. Friend’s ideas, but we have to give the current strategy time to work.

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

Comrade Premier—[Laughter.] I am surprised by that reaction. I mean, are we not all in this together? Are not the vast majority of us—apart from a small sect—in favour of strengthening the Union of the United Kingdom? And do not the vast majority of us dislike, distrust and despise the Liberal Democrats? On the subject of safe bases, does the right hon. Gentleman agree that there is no base safer than an aircraft carrier—

[Mr Speaker]

Order. I apologise for having to interrupt the hon. Gentleman. On this closed question, I was eagerly anticipating an inquiry about Afghanistan, but sadly it was not forthcoming.

[Mr Philip Hollobone (Kettering) (Con)]

Q11. What will my right hon. Friend be doing to ensure that foreign nationals engaged in terrorist-related activity in this country will be deported back to their country of origin when their evil plots are detected?

[The Prime Minister]

I really am grateful to my hon. Friend for raising that question. When foreign nationals threaten our country but we do not have the evidence necessary to prosecute them, it is essential for us to be able to deport them back to their country of origin. I have asked the Home Secretary to work with the Foreign Secretary to draw up agreements with as many countries as possible, so that we can deport those people and keep our country safe. All diplomatic efforts, including efforts by me, will be made to ensure that we keep our country safe.

[Mr Gordon Marsden (Blackpool South) (Lab)]

Q12. I heard what the Prime Minister said about the military covenant in answer to a previous question, and as chair of the all-party veterans group, I was relieved to see a commitment in the coalition’s document to providing extra support for veterans’ mental health needs. I was alarmed, however, to read that the £2 million set aside by the previous Government to support Combat Stress had been placed under review by the present Government. Is the Prime Minister able to renew that commitment to Combat Stress, or will it fall at the first hurdle?

[The Prime Minister]

First of all, let me congratulate the hon. Gentleman on his work for veterans, which is extremely important, and I welcome it. It is important, as I have said, that we have a very strong ministerial team at the Department of Health and at the Ministry of Defence, and I understand the huge pressure that will be put on our health services because of the mental health stress of people who have fought in combat. We will do everything we can to help them; the hon. Gentleman has my word that that will happen. It needs to happen not just this year, while our troops are still in Afghanistan, but for all the years into the future. There are figures that suggest that more people committed suicide after the Falklands war than were killed in combat. I take this issue extremely seriously; the hon. Gentleman has my word that those services will be properly looked after.

[Philip Davies (Shipley) (Con)]

I was greatly encouraged by the Prime Minister’s response to my hon. Friend the Member for Kettering (Mr Hollobone) about the deportation of terrorist suspects. Does not my right hon. Friend agree that the most effective way to get rid of these people is to scrap the Human Rights Act?

[The Prime Minister]

My hon. Friend, as so often, is tempting me. He knows that my view is very clear that we would be better off with a British Bill of Rights rather than with the Human Rights Act, and that matter is being examined. Enthusiastic though I am personally for that policy, I have to say that what is really needed for urgent action is individual agreements with countries like Pakistan in order to get a guarantee that people we send back there will not be mistreated. With countries like Pakistan, we should be able to achieve that. We are a major aid donor and a major partner; we should be able to encourage them to give us that guarantee so that we do not have to keep in our country foreign nationals that threaten to do us harm.

[Ian Mearns (Gateshead) (Lab)]

Q13. I welcome the Prime Minister’s recognition of the progress made in the north-east economy. In the economic context, it is said that when the United States sneezes, the United Kingdom catches cold and the north-east of England gets pneumonia. I was therefore sad to learn at the weekend that the regional development agency One NorthEast is preparing budgets within year for 40% cuts in operational output. Does the Prime Minister think that is good medicine for that sort of pneumonia?

[The Prime Minister]

First, may I welcome the hon. Gentleman on his election to this place? I well remember taking the Conservative party’s bi-annual conference to Gateshead. It was received all right, given what might have been expected.

[Ian Mearns]

Come back!

[The Prime Minister]

How can I refuse an offer like that?

On regional development agencies, what we have said is that in areas of the country where they work well and where local authorities want to keep them as they are, they can. We believe, however, that in many parts of the country, including the part I represent, there is a huge amount of waste in the system and it would be better to have local enterprise partnerships, with councils coming together to support business. Wherever regional assemblies—or rather, regional development agencies— are, we think there is a large amount of waste within them. We think some of the planning and transport functions should be given back to local authorities where they belong. That is what people will see from this Government: yes, we want to generate enterprise and help businesses to get going, but we also want proper local government that controls the things that local government should do.

Gaza Flotilla

Wednesday 2nd June 2010 Commons Chamber

15:32

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

With permission, I will report to the House on the events surrounding the interception of boats in the “Free Gaza” flotilla, on the immediate action that the Government have taken, and on our planned next steps.

In the early hours of 31 May, the Israeli defence forces intercepted six of the eight boats sailing in the “Free Gaza” flotilla. The incident led to injury and deaths of a number of passengers, mainly on one of the vessels. We await details of all the casualties and fatalities, but it is clear that many will be Turkish citizens. The Prime Minister and I have spoken to the Turkish Prime Minister and Foreign Minister respectively to offer our condolences. The six intercepted vessels were brought to shore in the Israeli port of Ashdod. Two of the boats have been delayed by mechanical difficulties and remain at sea. We believe that they are en route to Gaza.

I can inform the House that it now appears that a total of 37 British nationals were involved in Sunday’s events. That is different from the number given by the Prime Minister a short time ago, which was based on what the Israeli ambassador had said previously. I spoke to our ambassador in Tel Aviv in the past 45 minutes or so before coming to the Chamber, and I repeat that the latest figures are of 37 British nationals, including 11 dual nationals. We have so far received access to 28 of those individuals, one of whom was deported yesterday. We understand that four more British nationals agreed to be deported this morning and that the remaining British nationals are likely to be transferred to the airport soon. We have expressed our disappointment to the Israeli Government about the levels of preparedness on their part, and the fact that we have not yet been given full information about British nationals detained and access to all of them. We are urgently pressing the Israeli Government to resolve the situation within hours.

There is real, understandable and justified anger at the events that have unfolded. The Government’s position is as follows. Our clear advice to British nationals is not to travel to Gaza. However, we have made clear in public and to the Israeli Government that we deeply deplore the loss of life, and look to Israel to do everything possible to avoid a repeat of this unacceptable situation. The United Nations Security Council and the European Union have rightly condemned the violence that resulted in the loss of these lives. We continue to demand urgent information and access to all United Kingdom nationals involved. Their welfare is our top priority at this time, along with support for the families, who are understandably very worried. We are seriously concerned about the seizure of British nationals in international waters, and that aspect of the Israeli operation must form a key part of the investigation into the events.

The Prime Minister has spoken to the Israeli Prime Minister, I have spoken to the Israeli Foreign Minister, and the Under-Secretary of State for Foreign and Commonwealth Affairs, my hon. Friend the Member for North East Bedfordshire (Alistair Burt), has been in close contact with the Israeli ambassador in London. The embassy in Tel Aviv has been in constant contact with the Israeli authorities. I am grateful to right hon. and hon. Members who have already been in contact with the Foreign and Commonwealth Office about their constituents and their families, and who have provided information. We recognise the intense concern for those involved, and the need to keep Members updated.

Israel has told us that it wants to move as quickly as possible to deport people from the flotilla who are currently held in Israel. If they agree, they will be deported very quickly. Those who remain unwilling to leave will be allowed to stay for 72 hours in detention, which is the time limit allowed for them to appeal against deportation. Our understanding is that they will be deported after that. We also understand that the Israelis have begun to transfer to Jordan detainees from countries that are not represented in Israel. We understand that the individuals who were allegedly involved in violence against Israeli servicemen during the boarding will have their cases examined in line with Israeli legal advice. We do not currently believe that there are any British nationals in that last category, although I hope the House will appreciate that this is a fluid situation.

Our partners in the international community are working, as we are, to facilitate the swift release of those detained. Turkey is sending six planes to fly out their nationals, and the Turkish authorities have indicated that detainees of other countries may join those flights. We believe that some of the British nationals to whom I referred earlier are on those flights now.

The United Kingdom has played its full part in the European Union and the United Nations in agreeing on the need for a full, credible, impartial and independent investigation into these events. Our goal is a process that ensures full accountability for the events that occurred and commands the confidence of the international community, including international participation. Further discussions are taking place in other international forums, including NATO and the United Nations Human Rights Council. We will take the same principled stand in all our diplomatic efforts, and will stress to the Israeli Government the need for them to act with restraint and in line with their international obligations, given that their actions appear to have gone beyond what was warranted or proportionate. We need to know whether more could have been done to minimise the risks, or to reduce the number of deaths and injuries.

The events aboard the flotilla were very serious and have captured the world’s attention, but they should not be viewed in isolation. They arise from the unacceptable and unsustainable situation in Gaza, which is a cause of public concern here in the United Kingdom and around the world. It has long been the view of the British Government—including the previous Government—that restrictions on Gaza should be lifted, a view confirmed in United Nations Security Council resolution 1860, which called for

“sustained delivery of humanitarian aid”

and called on states to

“to alleviate the humanitarian and economic situation”.

The fact that that has not happened is a tragedy. It is essential that there be unfettered access not only to meet the humanitarian needs of the people of Gaza, but to enable the reconstruction of homes and livelihoods and permit trade to take place. The Palestinian economy, whether in Gaza or on the west bank, is an essential part of a viable Palestinian state which I hope will one day live alongside Israel in peace and security.

As the once productive private sector has been decimated and ordinary Gazans have lost their jobs and their incomes, it is tunnel entrepreneurs and their Hamas backers who benefit. Hamas now has near total control of the economy. Other groups, even more radical and violent, are finding a place amid the misery and frustration felt by a generation of young people. In this context, current Israeli restrictions are counter-productive to Israel’s long-term security. We will therefore continue to press the Israeli Government to lift the closure of Gaza, and plan early discussions with Israel as well as with our other international partners about what more can be done to ensure an unfettered flow of aid while also ensuring that aid reaches those who need it and is not abused. I discussed that with Secretary Clinton last night, and we will be taking forward our discussions on the subject urgently.

The House should not forget the role played by Hamas in this conflict. It continues to pursue an ideology of violence and directly to undermine prospects for peace in the region. Violence has continued in recent days, with rocket fire from militants in Gaza and Israeli military incursions and air strikes in response. We call on Hamas to take immediate and concrete steps towards the Quartet principles, unconditionally to release Gilad Shalit, who has been held in captivity for four years, and to end its interference with the operations of non-governmental organisations and UN agencies in Gaza.

It is more clear than ever that the only long-term and sustainable solution to the conflict that produced these tragic events is a two-state solution that achieves a viable and sovereign Palestinian state alongside a secure Israel, with its right to live in peace and security recognised by all its neighbours. The proximity talks that are under way are more important than ever. These events should not undermine those talks, but instead should underline just how important they are, and the Government will make it an urgent priority to give British diplomatic support to buttress that process. The Government will continue to keep the House informed of developments.

[David Miliband (South Shields) (Lab)]

I am grateful to the Foreign Secretary for his statement, and for advance sight of it.

I said in the Queen’s Speech debate last week that a policy of ignoring Gaza in the search for peace will not work. In the early hours of Monday morning, we saw why the blockade of Gaza is a barrier not only to vital aid and reconstruction materials, but to any hope of peace at all. The attack by the Israeli defence forces is the latest in a series of self-defeating and deadly moves by successive Israeli Governments in Gaza. We on the Opposition Benches join the international condemnation of an operation that was not self-defence but defence of a failed policy. Israel does have rights to security against terrorism, but we are talking here about a policy that has done nothing to defeat terrorism. Until the people of Gaza can be confident of an education for their children in schools not crumbling around them, of being able to feed and clothe their families adequately, and of being able to live without a prescribed list of what they can and cannot use in their kitchens, there is no way that the call of negotiation and peace will be heard.

As Foreign Secretary, I negotiated UK-sponsored UN Security Council resolution 1860 in January 2009, which eventually brought the Gaza war to an end. It demanded the full flow of humanitarian and reconstruction materials into Gaza, and an end to the trafficking of weapons into Gaza, and its implementation by all sides must be the central demand of the international community. That needs UN, EU and Quartet pressure, not just engagement.

The continuation of the blockade, not just by Israel but until yesterday by Egypt too, brings misery to Palestinians and does nothing to weaken the hold of Hamas on the territory—the alleged aim of the policy. In fact, revenue from smuggling taxes funds Hamas. The latest episode cost innocent lives, undermines Palestinians and Arabs who believe in co-existence and the peaceful path to statehood, and further isolates Israel in the international community. The only people smiling are the rejectionists. The answer to them is a political process with drive and momentum. I was glad to hear the Foreign Secretary talk about proximity talks, but proximity talks are worth having only as a short prelude to substantive negotiations, and, frankly, they have gone on for too long already without getting to the big issues.

I have five sets of questions for the Foreign Secretary, the first of which is about the welfare of British citizens. The lack of clarity about the position of British nationals is completely unacceptable. We are talking about 37 people, not 37,000 people. They have a right to consular support; it says so in their passports. They should be given that support immediately. If it is being denied, we should be denouncing that, not saying that we are disappointed by it.

Secondly, on the legality of the action, I spoke to the Turkish Foreign Minister in New York last night, and it is clear that the Turkish Government intend to pursue that question. Can the Foreign Secretary tell the House whether he believes that the action, which took place in international waters, was illegal, whether he has discussed the issue with the Turkish Government, and if not, why not?

Thirdly, the Foreign Secretary says that he wants to know whether more could have been done to minimise the risks or to reduce the number of deaths during the raid on the flotilla, but surely the question to ask is why on earth armed and lethal force was used at all. A fundamental principle is involved; the language of condemnation is used very sparingly in international relations, but it is the view of those on the Opposition Benches that the loss of innocent civilian life should always be condemned. We have done so since Monday, and the language was repeated in the United Nations presidential statement on Monday night, which said that the Security Council

“condemns those acts which resulted in the loss of at least 10 civilians and many wounded”.

We welcome that, but the Foreign Secretary and the Prime Minister have not used that language themselves. We call on them to say loudly and clearly that the British Government do condemn the loss of innocent civilian life. If they will not do that, they are setting a very dangerous precedent and sending a very bad message indeed.

Fourthly, on the Government’s intentions, we note the UN’s calls for an independent investigation, and of course we welcome them, but there are outstanding requests for investigations into incidents that took place during the Gaza war 18 months ago. Will the Foreign Secretary therefore explain to the House whether Her Majesty’s Government argued in the UN on Monday night for a UN investigation now? If not, why not? In that context, can he tell us how long he will give the Israeli Government to agree to an independent inquiry before he supports a UN inquiry?

Finally, the argument that opening borders only benefits Hamas has been exposed, because the present situation only costs innocent lives and actually damages Israel. What action does the Foreign Secretary propose to take through the UN and the European Union to drive forward improvements in the daily lives of people living in Gaza? Is it not the case that the EU has standing capacity waiting to be deployed to man checkpoints into and out of Gaza? Do we not need urgent engagement to get an agreement, as per resolution 1860, for those forces to be deployed?

This is a political crisis, not just a humanitarian one. Rocket attacks will be defeated only by a substantive political process towards a Palestinian state. That is where the greatest responsibility lies for all the parties. We will support all efforts on the part of the Government to make Gaza part of a wider international drive for peace in the middle east, backed by the UN and the EU, in support of US leadership, because without such an effort there will be no peace in the middle east.

[Mr Hague]

I am grateful to the shadow Foreign Secretary for his broad support for what is clearly a bipartisan policy shared across the Floor of the House. His concern for the people of Gaza is felt very deeply in all parts of the House. As he reminded the House, he played an instrumental part in the negotiation of UN resolution 1860 and he has always argued, as we have argued, that ignoring Gaza will not work; this problem must be addressed. I am grateful for the implicit support that he has given to the Government’s position and for the argument that he makes that the Israeli policy towards Gaza does not loosen but tightens the grip of Hamas on the people of Gaza.

I shall now respond to the right hon. Gentleman’s specific questions. He can tell that I am disappointed and very dissatisfied with the Israeli response, as it has gone on over recent hours, on consular access. The reason why I do not condemn the Israelis unequivocally is because there is a complicating factor: many people on board the ships did not have their passports or had destroyed all their papers, so it is not necessarily immediately obvious to which nationality they belong. In addition, there has been a clear lack of preparedness by Israel for handling this number of people and dealing with this number of consular inquiries. That is why, in some cases, our consular staff, who have been working extremely hard, have had to go to the prison at Beersheba to hammer on doors and ask people whether they are British. It has been chaotic, it is completely unsatisfactory and I am glad that some of the people are now able to leave the country. None the less, it is the most immediately urgent part of our work to ensure that that is put right and that all the British nationals have been identified and seen.

The right hon. Gentleman asked whether I had spoken to the Turkish Foreign Minister. I did speak to him. Of course, one reason for an investigation will be to learn more about the legality of what may have happened. However, to connect this to one of the right hon. Gentleman’s other questions, the Turkish Foreign Minister particularly thanked me for the role played by our ambassador at the UN Security Council, because the presidential statement delivered to the council was, of course, made on behalf of the members of the council, including Britain, so it is very much our language as well. We certainly condemn acts that lead to the deaths of civilians—I have done that before, but if the right hon. Gentleman has not heard me do so, I do so again—so there need be no difference between us on that point.

Critically, an investigation must be prompt, independent, credible and transparent. It is my view and, from the discussions that I had last night, the view of the United States that the investigation should as a minimum have an international presence. It is possible for Israel to establish such an investigation and inquiry. The right hon. Gentleman will recall that commissions or inquiries have on occasion been established in Israel that have delivered stinging criticism of the Israeli Government and armed forces, although on other occasions such inquiries have not done so when we might have thought it was merited. However, we look to them to heed the international calls for such an inquiry and investigation, and if they simply refuse to do so—to answer his question—it would not be long before we added our voice for one conducted under international auspices.

The right hon. Gentleman is right that urgent work needs to be taken forward on providing the mechanism for access to aid into Gaza, and for trade in and out of Gaza, while giving the Israelis sufficient assurance that it will not be used for the smuggling of arms, which none of us wants taken into Gaza. We are now taking forward that urgent work with our partners in the EU and the United States, and it is something on which we will need to return to the House.

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

It is easy to be condemnatory of Israel and to argue for the raising of the blockade, but we must ask ourselves whether these things, taken by themselves, will bring about the solution that we all seek. Drawing on our colonial experience and recent experience in Northern Ireland, is it not clear that sooner or later, however controversial it may be, Hamas will have to be brought into the circle of discussions?

[Mr Hague]

I always listen to my right hon. and learned Friend—I think I can now call him that, given that we are sitting on the same side of the House—with great care on these matters. He will be aware of the Quartet principles, which have been very clear for some years: Hamas must forswear violence, accept previous agreements and recognise the state of Israel. That has been the long-standing position of British Governments, the United Nations and the whole of the Quartet, including the United States, the European Union and Russia. I referred earlier to the need for Hamas to make concrete movement towards those principles in order for the rest of the international community to engage with it, and I continue to believe that that is the right position. It is a long-standing position and one that we have in common with our allies and the rest of the international community acting on the affairs of the middle east. That position must be sustained.

[Sir Gerald Kaufman (Manchester, Gorton) (Lab)]

In welcoming the tone of the Foreign Secretary’s statement and his condemnation of the loss of innocent life, may I ask whether he recognises that those innocent lives might well have included any of the 37 United Kingdom citizens present when the Israelis committed a war crime of piracy in international waters, kidnapping and murder—and all in pursuit of upholding an illegal blockade on Gaza that amounts to collective punishment, as I saw for myself when I led an international parliamentary delegation there early this year? Will he assure the House that, if the Israelis fail to comply with the perfectly modest and satisfactory request that he has made of them, further action will be taken to make Israel rejoin the international community?

[Mr Hague]

Yes, it is very important that Israel responds to the call from across the whole world, to which we have added our voice, for a prompt, independent, credible and transparent investigation or inquiry. As I mentioned earlier, in my response to the shadow Foreign Secretary, if no such investigation or inquiry is forthcoming, we will want to advocate such an inquiry under international auspices. The right hon. Member for Manchester, Gorton (Sir Gerald Kaufman) is right that whatever precise words we use, a blockade of Gaza is counter-productive; it is wrong and it does not even serve the interests of the security of Israel. He is also right to point out that fatalities could have occurred among the British nationals who were caught up in this. It is our strong advice to British nationals, as it has been in the past and will be in the future, not to travel to Gaza—let me make that absolutely clear—as they would be going into a dangerous situation, but it is absolutely wrong to maintain the blockade. That is the clear position of the Government.

[Several hon. Members]

rose—

[Mr Speaker]

Order. Another 29 right hon. and hon. Members are seeking to catch my eye, and the debate to follow this statement is very heavily subscribed, so I need short questions and short answers.

[Sir John Stanley (Tonbridge and Malling) (Con)]

Is my right hon. Friend aware that those of us who were able to enter Gaza in the aftermath of the last Israeli incursion could only come to the conclusion that there had been a wholly disproportionate use of lethal force of very, very dubious legality? Does he agree that there has now been a repeat of precisely that? What will the British Government do to try to ensure that there is not the same repetition again and again and again?

[Mr Hague]

Hopefully, I covered that point in my statement. I referred to the actions that have been taken by Israel as appearing to go beyond what was warranted or proportionate, and I weigh those words very carefully. I also said that that is unacceptable and that Israel must act with restraint and in line with its international obligations, so we have given a very strong message to Israel. In the conversations that I had with the Israeli Foreign Minister and that my right hon. Friend the Prime Minister had with the Israeli Prime Minister, there could be no mistaking how strongly we feel. My right hon. Friend the Member for Tonbridge and Malling (Sir John Stanley) adds force to how we feel.

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

Bearing in mind that the ship was a peace ship in international waters, is not attacking such a ship against international law and should it not be condemned by the Foreign Secretary as an illegal act?

[Mr Hague]

One has to agree that to board a ship in international waters can legally happen only in the most exceptional and extraordinary circumstances, so that is the basis we are working from.

[Jo Swinson (East Dunbartonshire) (LD)]

My constituent Hasan Nowarah was injured when the flotilla came under attack, although he is now, thankfully, safely at home with his family. He was motivated by a desire to help people in the most dire need, but the 45 tonnes of medical equipment that he helped to collect is currently floating aboard the ship, the Rachel Corrie, in the Mediterranean. Will the Foreign Secretary use his diplomatic efforts to persuade the Israeli Government to let that vital medical aid be delivered to hospitals in Gaza?

[Mr Hague]

Yes, I very much take that point. The Under-Secretary of State for Foreign and Commonwealth Affairs, my hon. Friend the Member for North East Bedfordshire, has just undertaken, as we were listening to the hon. Lady’s question, to look into what is happening to that specific shipment. I believe that some of the aid on some of the ships involved is now arriving in Gaza, but we will look into the shipment that she mentions.

[Mrs Louise Ellman (Liverpool, Riverside) (Lab/Co-op)]

This is a dreadful and deplorable tragedy, but will the Foreign Secretary tell us what urgent steps he will take to ease the transfer of essential goods through the crossings so that Israel’s security needs can be met? Does he accept that Israel has legitimate security needs against the enemy that is determined to destroy it?

[Mr Hague]

Of course Israel has legitimate security needs. That is why I stressed in my statement the role and responsibility of Hamas and the need for it and anyone else in Gaza to end rocket attacks on Israel. That is a very important part of the entire situation as well. We need to find a way in which Israel can be assured that the smuggling of arms into Gaza does not take place while the flow of humanitarian aid and general economic trade can take place. Clearly, some additional assurance is going to be necessary for that to happen, and that is what we are working on urgently.

[Nicholas Soames (Mid Sussex) (Con)]

May I welcome the clear but restrained way in which the Foreign Secretary dealt with this very difficult matter? May I ask him a very precise question: has it not been clear for a long time now that the blockade of Gaza is illegal? Does it not therefore amount to cruel and unusual punishment, and is it not contrary to all international law and the Geneva convention?

[Mr Hague]

The argument that I make is that, whatever the arguments about the blockade’s legality, it is unwise—it does not achieve its objective. In a practical world, it is not the right thing for Israel to do. No doubt, the Government of Israel would make a different legal argument from that of my hon. Friend: they maintain that the blockade is lawful because they are acting in their own self-defence. Therefore, the thing that they must be persuaded of is that the blockade does not serve their security interests and that a change of policy is urgently required.

[Sammy Wilson (East Antrim) (DUP)]

I note the Foreign Secretary’s demand for free and unfettered access to Gaza but, in the absence of a blockade of shipping into Gaza, how does he believe that the people of Israel can be protected from the unprovoked assaults by rockets and other armaments that are being imported into Gaza by the supporters of Hamas terrorists?

[Mr Hague]

That is why I have referred to the international work that needs to take place to try to give assurance that such importation of arms cannot take place while humanitarian and economic aid, and general economic trade, is going on. However, I stress again that it does not serve the interests of Israel’s security to maintain the current position, which is putting more power into the hands of Hamas and driving the people of Gaza into its arms. That does not serve the security of Israel.

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

Will my right hon. Friend use his good offices to ask Israel to desist from using selective footage to make its case through the media rather than engaging in the full inquiry into this terrible incident that should take place?

[Mr Hague]

My hon. Friend makes a very powerful point, although we will be doing very well in the world if we can persuade everyone to stop using selective footage in the media. It may be a little ambitious to think that we will be able to persuade Israel to do that, but that underlines the need for the impartial and credible inquiry for which we have called.

[Jeremy Corbyn (Islington North) (Lab)]

In the past 18 months, Israel has killed 1,400 people during Operation Cast Lead. It has also carried out an assassination in Dubai using false passports, and now it has killed people on the high seas. On each occasion, there has been ritual condemnation, as there is today. I support that condemnation, but is it not time for us to take sanctions against Israel, such as lifting the EU-Israel trade agreement? Israel must understand that it cannot act illegally with impunity, and that it cannot kill people on the high seas in the way that it has just done.

[Mr Hague]

Israel will be listening to the condemnation in this House, including from the hon. Gentleman. There is no doubt about that, but I do not think that the right policy is to impose sanctions. I think that the right policy is to urge on Israel the course of action that I have set out today. The restrictions and the blockade of Gaza should be lifted, and a truly credible and independent investigation should be set up. They are part of the practical way forward that we should concentrate on, and therefore they are the right foreign policy for this country.

[Mr Julian Brazier (Canterbury) (Con)]

I welcome my right hon. Friend’s statement, but does he agree that the effect of the brutal Israeli blockade of Gaza is to drive all trade into the tunnels? Some of the tunnels are now large enough to accommodate 4x4 vehicles, and of course there is no restriction whatever on the importation of weapons through them.

[Mr Hague]

Yes, and my hon. Friend makes a very powerful point. What in effect happens is that Hamas is able to tax the importation of goods through the tunnels, providing funds for itself while further impoverishing the people of Gaza. That is a further reminder that the blockade is not an effective policy.

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

Is it at all possible that the Israelis are aware of the worldwide revulsion at what has happened this week? The killings on the high seas had no justification whatsoever, and my hon. Friend the Member for Islington North (Jeremy Corbyn) spoke about other measures that Israel has taken. Is it not clear that Israel seems to show no concern at all for international opinion, and that it is out of control? Unless firm action is taken by the international community, will we not see further tragedies of this kind?

[Mr Hague]

I would not necessarily reach the conclusion that there is no awareness or concern about international opinion in Israel. In fact, there has been a good deal of criticism of the Israeli Government in the Israeli media over the past couple of days. Remember that Israel is a democracy. There is free expression of opinion. Sometimes that is bitterly critical of their own Ministers, and sometimes of their own armed forces. We saw that in the aftermath of the Lebanon war four years ago. I think it would be over-simplifying the situation to describe it as the hon. Gentleman did a few moments ago. There is a consciousness in Israel of international opinion. That is why we have to express ourselves in a way that is forceful but responsible, and ask them to do reasonable things that are in their own best interest. That is the position that we have taken.

[Robert Halfon (Harlow) (Con)]

Will the Foreign Secretary acknowledge that there has been up to 1 million tonnes of aid from Israel to Gaza since January 2009? Will he also acknowledge that the reason for the blockade, which we all want to end, is continued terrorism by Hamas, the hijacking of aid convoys and the smuggling of arms from Iran into Gaza?

[Mr Hague]

It is very important to remember the role played by Hamas. It is important to remind people all the time, as I did in my statement, that we need to see an end to the rocket fire from Gaza into Israel, as well as the other measures that we have called on Israel to take. My hon. Friend brings that necessary balance to the questions asked today.

[Caroline Lucas (Brighton, Pavilion) (Green)]

The Foreign Secretary will know that the terrible siege of Gaza has been ongoing now for three years, with huge suffering caused to people, but given that the condemnations and criticisms of Israel never seem to change the Israeli authorities’ actions, what further action does he propose to take? In the EU association agreement with Israel, for example, there is a clause that provides for its suspension in the light of human rights abuses on either side. Will not his refusal to consider suspending that EU association agreement give the message that we are not serious about taking action with Israel, and that we are not serious about our EU agreements either?

[Mr Hague]

I do not think Israel will be in any doubt about the seriousness of the message. The fact that a Security Council statement was agreed so rapidly, with the support of the United States as well as of the United Kingdom, will have made an impact on Israel; the hon. Lady can be sure of that. If she could have heard the conversations that we have had with out Israeli counterparts, she could also be very confident that they are aware of the strength of opinion and our deep concern about these issues.

The EU-Israel agreement is not exactly progressing at the moment anyway. I take the point that she makes about that, but it is not an additional measure for this particular situation. As I have explained in answer to previous questions, I want to concentrate on trying to make sure that that credible and independent investigation takes place, and that the case is understood in Israel for the lifting of the blockade of Gaza in their own best interests. It is important that we put it in that way.

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

The flotilla, which was probably doomed to fail, was an expression of the frustration of ordinary people at the failure of the United Nations, and in particular of the Quartet, to get Israel to comply with its UN obligations. The Foreign Secretary has had conversations with Mrs Clinton. I understand that he is also meeting the EU High Representative. Does he believe that between us we can encourage the Quartet to take firmer action with Israel, which still in its statements today seems not to understand the gravity of the situation?

[Mr Hague]

There is a real international focus on these matters now, and that is true in the United States. I was with the EU High Representative, Baroness Ashton, last night in Sarajevo, and she certainly has the same focus on these issues, as do many other EU Foreign Ministers. This morning I was at the EU-western Balkans high-level meeting in Sarajevo, and many of the Foreign Ministers discussed the issue in the margins of that. One of the results of the action was to bring the issue centre stage. It has shone a spotlight on the problems of Gaza, to which so many right hon. and hon. Members have referred. It is now important for us to take the momentum from that and make sure that the necessary work continues over the coming weeks and months to improve the situation.

[Frank Dobson (Holborn and St Pancras) (Lab)]

Will the Foreign Secretary not accept that what he said today really amounts to saying that the United States, Britain and Europe will continue to tolerate the Israeli blockade of Gaza? Does he not agree that this toleration should be brought to an end, and, if necessary, Britain and the other European members of NATO should say that if another flotilla sets off for Gaza, we are willing to give it naval protection, with the Royal Navy reverting to its traditional role of protecting the freedom of the seas?

[Mr Hague]

I understand, in every case in which right hon. and hon. Members express their outrage at what has happened, the strength of feeling in many parts of the House and of the country. As I have explained, in the pursuit of practical foreign policy we should concentrate on the two things that I have identified—the setting up of the right kind of investigation and inquiry, and doing so quickly, and making the coherent case, including to the Israelis, for lifting the blockade on Gaza. Those are the right things to concentrate on. The right hon. Gentleman refers to British naval protection and deployment, but the previous Prime Minister promised a British naval deployment in the Mediterranean to try to stop arms smuggling to Gaza, and no ship was ever sent. I will not make empty promises; we will concentrate on the two issues that we have identified as necessary.

[Mr William Cash (Stone) (Con)]

Given the importance of the investigation that the Foreign Secretary referred to, does he not also believe that there is a very powerful case for referring this to international arbitration and/or the international court at The Hague? After all, this involves not only questions of international law. The political causes are well known, but they have not yet been resolved by the political intervention of the Quartet, and so forth, and international arbitration may well be a very good move to adopt.

[Mr Hague]

The position that we have taken does not exclude those things, but they are quite difficult things to bring about and seek agreement to, so the priority is to have an inquiry and investigation established as soon as possible that meets the criteria that I have set out. However, we have not excluded advocating other courses of action if that is not heeded.

[Ann Clwyd (Cynon Valley) (Lab)]

I think that we have pussy-footed around Israel for long enough. The only language that it understands is not the language of diplomacy but the language of the hobnail boot, by which I mean sanctions, telling it to stop building any more settlements, and insisting that it has talks with people—both sides—who represent the Palestinian people, as the right hon. and learned Member for North East Fife (Sir Menzies Campbell) said. I hope that the Foreign Secretary will develop a much more robust foreign policy towards Israel.

[Mr Hague]

Again, the right hon. Lady illustrates the strength of feeling in the House. I have not immediately donned my hobnail boots, because the right way to approach the matter, which will make sense to people in Israel as well as to the rest of the world, is to advocate the measures that I have called for today. That is a crucial ingredient for Israelis themselves to see—that this needs to be properly investigated to international standards in a way that the international community can respect and take seriously, and that the blockade of Gaza makes no sense even from their own point of view. Israel is a democratic country. It is possible to make these arguments and to have them heard there, so I favour concentrating on that method of proceeding rather than the hobnail boots that she wants me to put on.

[Geoffrey Clifton-Brown (The Cotswolds) (Con)]

My right hon. Friend has made it quite clear this afternoon that he thinks that the blockade is counter-productive because of the suffering that it causes to the people of Gaza. Will he therefore press the international community to lift the blockade as a precursor to a full middle east peace settlement?

[Mr Hague]

It is a very important part of any middle east peace settlement, and my hon. Friend’s question reminds us that it is very important to continue the work on a middle east peace settlement overall. The proximity talks have been taking place and we want them to become much more serious. European nations now have to look to how we can buttress the efforts of the United States to push those talks forward. It is one of the things that I want to discuss around European capitals next week. Ending this blockade of Gaza is an integral part of finding any such durable solution.

[Richard Burden (Birmingham, Northfield) (Lab)]

Is it not clear that Israel believes that it has done absolutely nothing wrong when it sends armed commandos to attack in international waters ships carrying humanitarian supplies to a tiny strip of land where more than 60% of the population are food-insecure? Could that not be because, for many years now, Israel has put itself above international law, without consequence from the international community? What does the Foreign Secretary think the practical consequences should be if Israel does not abide by the will of the international community this time?

[Mr Hague]

We will see whether Israel thinks, in the end, that it has done nothing wrong. The Israeli Cabinet is, as I understand it, meeting this afternoon for the first time since the incident and since Mr Netanyahu returned from north America, and we will see what, if indeed anything, comes out of that in terms of the investigation—the inquiry—that we and most of the rest of the world have called for. Again, I stress that it is important to make the case for those two things, the investigation and the lifting of the blockade, because it would be wrong to characterise everyone in Israel as insensitive to international opinion. This is an argument that has to be won within Israel, as well as in the rest of the world. That is why I am taking the approach that we are taking and, indeed, previous Governments, broadly, have taken; and I am sure that, for now, that is the right approach.

[Dr Andrew Murrison (South West Wiltshire) (Con)]

Does my right hon. Friend agree that it is a little rich for the Israeli Government to justify their behaviour on the ground that they are denying matériel to a terrorist organisation when they have in the recent past shown themselves perfectly willing to import proscribed munitions for use against civilian targets?

[Mr Hague]

Again, my hon. Friend adds to a strength of feeling and to points made that will be widely noticed and, I hope, taken note of in Israel itself.

[Anas Sarwar (Glasgow Central) (Lab)]

The Foreign Secretary has quite rightly said that we need a credible and independent inquiry. This was an illegal act in international waters, involving citizens from many countries throughout the world. Surely the only way in which we can have a credible and independent inquiry is if it is an international, credible inquiry. Does the Foreign Secretary support that? If not, why not?

[Mr Hague]

We shall see about that. The hon. Gentleman may be right in the end, but, in answering his right hon. Friend the Member for South Shields (David Miliband), I referred to the fact that Israel has previously held inquiries—into some of the events in Lebanon in the 1980s and into the Lebanon war in 2006—that certainly were independent and credible by international standards, and that meted out considerable and, sometimes, severe criticism to the authorities in Israel. It is possible for them to do that. Today I have made the additional case that such an inquiry and investigation should have an international presence and, therefore, be not just an Israeli inquiry. But I have also not excluded this Government from advocating the sort of inquiry that the hon. Gentleman would prefer to see, if no other action is taken in the meantime.

[Mr Philip Hollobone (Kettering) (Con)]

Behind Hamas lurks the spectre of both Syria and Iran. Were the Gaza blockade to be lifted at some point in the future, what practical assistance could Her Majesty’s Government, the European Union or NATO offer to Israel in order to stop the smuggling of weaponry from those two rogue states?

[Mr Hague]

Such assistance and such assurance is very important, and that is why we are now consulting other nations on the best vehicle for providing it: whether that is best done under United Nations’ auspices, and how much more the European Union can do. There have, of course, been previous attempts to provide it under EU auspices, but it is very important to be able to stop the flow of arms into Gaza, just as it is so vital to be able to open up Gaza to humanitarian aid and to more normal economic activity. My hon. Friend makes a very powerful point.

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

I join my colleagues in condemning the actions of the Israeli Government. Two of my constituents, Sarah Colbourne and one other woman, are currently in detention in Israel. I thank the consulate for its work with them, but I am concerned about their position. I agree with the Foreign Secretary that an international flavour to an investigation, and an independent investigation, are important. Notwithstanding that, will he or the Under-Secretary of State, the hon. Member for North East Bedfordshire (Alistair Burt), agree to meet my constituents and others who were there—because nothing beats hearing it from the horse’s mouth—in an attempt to shape this Government’s foreign policy towards Israel?

[Mr Hague]

Yes. In fact, my hon. Friend is already working on plans to meet such a group when they have returned, if they desire such a meeting.

[Andrew Gwynne (Denton and Reddish) (Lab)]

I welcome the Foreign Secretary’s statement, in particular the call for an international and impartial element to an investigation. However, is it not crucial to ensure that the peace talks resume and that the role of Turkey, which had been an important regional ally of Israel’s, is both supported and encouraged?

[Mr Hague]

Yes, that is very important. It is important that the proximity talks turn into something much more than proximity talks. Turkey has become very active diplomatically in the whole region, and in a very welcome way; in our proceedings this afternoon, we have referred several times to the role of the Turkish Foreign Minister. Turkey has tried hard in recent years to bring Syria and Israel closer together and it has sometimes come within an ace of bringing permanent peace between the two countries. In general, Turkey has played a very constructive role in the region, and I am sure that she will want to do so in future.

[Barry Gardiner (Brent North) (Lab)]

The unauthorised boarding of a vessel in international waters by armed combatants is normally referred to as piracy. The Foreign Secretary is a Yorkshireman noted for his blunt speaking. Will he not use that word on this occasion?

[Mr Hague]

The blunt Yorkshireman has been converted into a Foreign Secretary who weighs his words carefully, dramatic transition though that may be. As we are advocating a prompt, independent, credible and transparent investigation and inquiry, in the terms that I have put forward, it is important for us to be prepared to see what it produces before feeling that we need to add any other language to how I have expressed things today.

[Angus Robertson (Moray) (SNP)]

This afternoon, the Secretary of State appears to have ruled out a number of options for dealing with Israel within a European Union context. What exactly is the United Kingdom doing within the European Union to maximise diplomatic pressure to end the blockade on Gaza?

[Mr Hague]

I am not conscious of ruling anything out, and I am not ruling anything out. But again I must stress that there is an enormous amount of pressure. I had dinner with many of the European Foreign Ministers in Sarajevo last night and I have seen many more of them this morning. They are all expressing themselves in very similar ways, and very emphatically, to the Government of Israel. There is no doubt about the intensity of the feeling and pressure from the European Union. Clearly, we will now want to discuss as a body what more we can do and, most importantly, what we can do working with the United States to try to give new momentum to the middle east peace process as a whole. The issue is right up there on the agenda and in the minds of European Foreign Ministers, and there will be a great deal of pressure.

[Mr Andy Slaughter (Hammersmith) (Lab)]

As someone who has been to Gaza twice since Operation Cast Lead, I ask the Foreign Secretary to exempt Members of the House, at least, and other people who can bear witness, from the advice not to travel to Gaza. Perhaps he would like to go himself. Having a news blackout and hiding the appalling situation is exactly what the Israeli Government want, as they did during Operation Cast Lead. May I add that the Foreign Secretary’s testy conversations with Mr Lieberman are not going to get us anywhere? We need sanctions if Israel is to lift the blockade at all.

[Mr Hague]

Testy conversations with Mr Lieberman are part of what we need to do. I have explained our overall approach and my reaction to the suggestion of sanctions. I understand the hon. Gentleman’s strength of feeling and knowledge about the situation in Gaza. Our general travel advice is not to go to Gaza, but sometimes Members of Parliament are able to go in a privileged and particularly safe way. Such visits must happen and are welcome; it is important for this House to have as much knowledge and information as possible about what is happening on the ground. I am not discouraging right hon. and hon. Members from going under the right circumstances, but let us not mistake that for our general travel advice to the British public.

[Geraint Davies (Swansea West) (Lab/Co-op)]

As the Foreign Secretary mentioned, under Israeli law aid workers may face charges. Should not the killers of the aid workers face charges under international law?

[Mr Hague]

Since we have called for an investigation, I do not think that we can pre-empt such matters. I stress that, as far as we know, the aid workers, activists, or people who were aboard the ship—however we want to describe them—and who may be in that position do not include any of the British nationals. Again, the hon. Gentleman makes a point that illustrates the strength of feeling in this House. That is one reason why we need to continue to call so strongly for the credible investigation to which I have referred.

[Tony Lloyd (Manchester Central) (Lab)]

The Foreign Secretary has rightly referred to the strength of feeling in this House, and, indeed, almost on a global basis. However, he will be as aware as anyone that Israel has a well-founded reputation for toughing out these crises, hoping that they will go away, and has been very successful in doing that. He made the point, again rightly, that these events are the recruiting sergeants for terrorism. Can he tell the House—this is a serious question—what will be different this time?

[Mr Hague]

I cannot guarantee to the hon. Gentleman what the course of events will now be. I can say, slightly reiterating what I said earlier, that these incidents have shone a particular spotlight on to the situation in Gaza. The speed and unity of the diplomatic response is unusual. I referred earlier to the ease with which the UN Security Council statement was agreed, including with the United States—I stress that point. I think that that will have been duly noted in Israel; in fact, I know that it has been duly noted in Israel. Can I promise what reaction the Israelis will now provide? No, I cannot, but we will watch it very closely and minutely, and we will argue very strongly for the measures that I have set out today, not excluding other courses of action in the future.

[Stephen Pound (Ealing North) (Lab)]

It is an unusual and impressive sight to see a Yorkshireman linguistically restrained, but I thank the Foreign Secretary for what was, in the main, a robust and refreshing statement. I also include the shadow Foreign Secretary in that.

The Foreign Secretary mentioned that the Rafah crossing has been reopened. We have been told in the past that that will open up an enormous amount of access for munitions and weapons of war. If some good has come from this bloodstained horror, it is the opening of the Rafah crossing. Will this be monitored, will there be a report to the House, and will we be able to consider, in this House, whether the truth of the Rafah crossing is that it is simply another border crossing, and not an access point for matériel for Hamas?

[Mr Speaker]

There were three questions, but one answer will suffice.

[Mr Hague]

Yes, it is very important that this is monitored, and I certainly welcome other opportunities for the House to discuss these matters and to be updated on these events.

[David Cairns (Inverclyde) (Lab)]

Is it not the case that resolution 1860, as well as calling for an end to the blockade, acknowledges that the international community itself has responsibility to ensure that weapons are not smuggled into Gaza? We know that the Foreign Secretary does not want to send a gunboat to ensure that this happens—[Interruption.] I think that a gunboat has a rather different aim from what my right hon. Friend the Member for Holborn and St Pancras (Frank Dobson) wanted. Given that, what practical steps can the international community take to offer assistance not only to Israel, but to Egypt, to ensure that weapons are not getting into the Gaza strip, which will reassure the great mass of Israeli public opinion, which I believe will be as horrified about these events as are people in this House?

[Mr Hague]

The hon. Gentleman puts his finger on what is required. There have been previous attempts at various forms of international presence and activity around Gaza that were meant to give assurance. Clearly, that has not worked, so we now have to find a new mechanism for doing so. Britain stands ready to help in many ways. When the hon. Gentleman referred to needing a gunboat, one of my right hon. Friends said, “We haven’t got one.” That was indeed how it turned out under the previous Government, when such a thing was offered but never materialised. That is why I am not making any rash promises. However, given the huge importance of this issue in international affairs, the United Kingdom will do whatever we can to assist.

[Valerie Vaz (Walsall South) (Lab)]

My constituents want more than pressure. Will the Foreign Secretary come back to the House and report on a timetable for the discussions on a diplomatic solution, just as we did on Ireland?

[Mr Hague]

I think that there will be many more discussions in this House. I am not offering a timetable today, but I have indicated that we have not excluded other actions and pressures in the future. I would be very disappointed if we did not have a further opportunity to discuss these things.

[Mr Denis MacShane (Rotherham) (Lab)]

rose—

[Mr Speaker]

Last but not least, I call Mr Denis MacShane.

[Mr MacShane]

Thank you, Mr Speaker. I welcome the robust condemnations and statements from the Foreign Secretary and from my right hon. Friend the shadow Foreign Secretary, but is the Foreign Secretary aware that the Hamas charter states:

“There is no solution to the Palestinian problem except by Jihad. The initiatives, proposals and International Conferences are but a waste of time, an exercise in futility”,

that

“our struggle against the Jews is extremely wide-ranging”

and that

“Israel…will remain erect until Islam eliminates it”?

Such anti-Semitic, anti-Jewish language is the official doctrine and policy of Hamas. I share in all the points that the Foreign Secretary made and wish him well, but Hamas is part of the problem, not yet part of the solution.

[Mr Hague]

I am grateful to the right hon. Gentleman—I never thought I would say those words, but I am. I hope that I made that point in my statement in a slightly different way, by referring to the ideological motives of Hamas and reminding the House that there is a Hamas dimension to the whole problem. It has refused to forswear violence, recognise previous agreements and recognise Israel’s right to exist, and until it starts making some concrete movement towards those things, it will be very difficult for the international community to discuss the future with it. The right hon. Gentleman adds force to that argument.

[Mr Speaker]

I am grateful to right hon. and hon. Members for their co-operation, as a result of which everyone who wanted to contribute on the statement was given the opportunity to do so.

Debate on the Address

Wednesday 2nd June 2010 Commons Chamber

[4th day]

Debate resumed (Order, 27 May).

Question again proposed,

That an humble Address be presented to Her Majesty, as follows:

Most Gracious Sovereign,

We, Your Majesty’s most dutiful and loyal subjects, the Commons of the United Kingdom of Great Britain and Northern Ireland in Parliament assembled, beg leave to offer our humble thanks to Your Majesty for the Gracious Speech which Your Majesty has addressed to both Houses of Parliament.

Education and Health

Wednesday 2nd June 2010 Commons Chamber

16:31

[The Secretary of State for Education (Michael Gove)]

It is a great honour to be asked to speak in support of the Gracious Speech this afternoon. As the right hon. Member for Morley and Outwood (Ed Balls) will know, there are few greater honours and few more daunting invitations than being asked to lead the Government Department responsible for the country’s schools. I am grateful beyond words for the chance to serve my country in this job.

I am grateful also to have a team alongside me that is distinguished and dedicated to ensuring that every child has a better start in life. I am grateful that my hon. Friends the Members for Bognor Regis and Littlehampton (Mr Gibb), for East Worthing and Shoreham (Tim Loughton) and for Brent Central (Sarah Teather) have agreed to serve in this partnership Government. I look forward to working with them in the years ahead.

This Gracious Speech contains two education Bills. Those measures will grant more freedom to teachers, give more choice to parents, reduce bureaucracy for all schools and provide additional help for the weakest. They will ensure that standards rise for all children and will specifically target resources on the most disadvantaged, so that we narrow the gap between the rich and the poor.

[Bob Russell (Colchester) (LD)]

Will the Secretary of State give way?

[Michael Gove]

In due course. This is a progressive programme and, as I am sure my hon. Friend the Member for Colchester (Bob Russell) appreciates, it comes from a partnership Government. I know that our programme commands support from hon. Members on both sides of the House. It also owes a great deal in its design to someone I am proud to call a right hon. Friend. Before I say anymore, may I therefore say a few words about my right hon. Friend the Member for Yeovil (Mr Laws), who was for three years the Liberal Democrat spokesman on education? During that time I, like the right hon. Member for Morley and Outwood, got to know, like and admire my right hon. Friend. In all our dealings, he was unfailingly honest, considerate, thoughtful and principled. He never, ever sought personal advantage, but instead sought at all times to do the right thing, consistent with his principles.

My right hon. Friend always sought to deploy his considerable personal gifts—his intelligence and capacity for hard work—in the service of those who were less fortunate. In particular, he championed the interests of poorer children, making the case for more investment in their education and for more freedom for teachers to close the gap in performance between the poorest and the rest. It is thanks to him more than anyone that a commitment to investing more in the education of the poorest—a pupil premium—is at the heart of this coalition Government’s plans for schools. In securing that reform, he has already secured an achievement in government of which he and his many friends can be proud. It is my profound hope that he will very soon have the chance to serve again, and I am sure the whole House will join me in wishing him well at this time.

Although we might disagree about much, I know that the right hon. Member for Morley and Outwood is wholeheartedly in agreement with me on that issue. I pay tribute to him, too, for the work he did in office. He is a pugnacious political operator, as his rivals for the Labour leadership—including the right hon. Member for Leigh (Andy Burnham)—are about to find out if they do not already know. Having shadowed him for three years, I know that his pugnacity is matched by passion. He came into politics for the right reason: to help the underdog. During his time at the Treasury, although we may have argued with much that he did, it is to his credit that he never forgot to prioritise the fight against child poverty.

During his time as Secretary of State, the right hon. Gentleman secured real achievements. He secured a better deal for children living with disabilities, with more respite care for parents and progress on improving the education of children with special needs. The separation of exam regulation from curriculum design, with the creation of a new regulator, Ofqual, which has the potential to play a part in restoring confidence in exam standards, was a real step forward. He also showed real leadership on child protection, with swift action in the aftermath of the terrible tragedy of baby Peter Connelly’s death. The right hon. Gentleman also took constructive steps to help social workers in the vital task that they perform. The coalition Government will build on his initiative in this area, in particular taking forward the recommendations of the social work task force.

I also thank the right hon. Gentleman for the robust way in which he made the case for the continuation of key stage 2 tests to mark and monitor the achievement and attainment of children in primary schools. These are a vital accountability measure, and his robust case for their continuation ensured a consensus across the House for more data, greater parental accountability and a relentless drive for improvement in early years education. We are all in his debt, and I hope that we can maintain that consensus in months to come.

The right hon. Gentleman also always made the case robustly for his Department in budget rounds. He fought with determination, and he was never reticent in letting the Treasury know just how it should discharge its responsibilities towards our schools. That is perhaps why the shadow Chancellor has today come out in favour of the David Miliband leadership campaign.

[David Wright (Telford) (Lab)]

On the subject of negotiations with the Treasury, can the Secretary of State tell us what negotiations he is having about the future of the Building Schools for the Future programme? Four secondary schools in my constituency are waiting for a decision. They badly need to be renewed and rebuilt: will he deliver?

[Michael Gove]

We will seek to deliver at every stage. I am delighted that the hon. Gentleman is in his place and that I had the opportunity to visit two superb schools in his constituency, including Madeley school, which has recently been rebuilt. I know that Building Schools for the Future makes a distinguished contribution to ensuring that we renovate and refurbish the schools estate, but I have concerns that under my predecessor the programme was not allocating resources to the front line in the most efficient way. It is critical that we ensure that taxpayers’ money is spent on the front line improving education, and not on consultants, architects or bureaucracy. I am sure the hon. Gentleman will agree that we all have a duty to ensure that money goes to the front line, and I am sure that the right hon. Member for Morley and Outwood will agree that we should congratulate the Chancellor and the Treasury on the agreement that was reached in the spending round just concluded. For the remainder of this financial year, we will guarantee that there will be no cuts in front-line funding for schools, Sure Start and sixth forms. I hope that both sides of the House approve of that.

[David Tredinnick (Bosworth) (Con)]

My right hon. Friend is setting out his stall eloquently and is being generous in his remarks. He mentions his discussions with the Treasury. Will he accept that the county of Leicestershire is bottom of the pile when it comes to funding, and will he reconsider the funding formula, as we asked the previous Government to do throughout the last two Parliaments?

[Michael Gove]

My hon. Friend makes a passionate case, and I know that Leicestershire is one of the F40 local authorities that have had to do a remarkable amount with not enough. I will listen sympathetically to him and to other colleagues from both sides of the House who represent areas that need a fairer funding formula.

[Bob Russell]

Will any revenue and capital funding for the so-called free schools come from existing education budgets?

[Michael Gove]

I know how committed my hon. Friend is to the education of children in Colchester and, indeed, to that of children throughout the country. He will be relieved to learn that we will ensure that front-line funding for existing schools will not be damaged by the reforms that we intend to make.

[Kate Green (Stretford and Urmston) (Lab)]

Will the Secretary of State confirm that he is aware of some of the successful pilots that have been attempted in recent years to provide free school meals on a universal basis in some of our primary schools? Will he confirm that the educational and health gains that have been seen as a result of those pilots will now be taken forward, and that his Government will commit to continuing the pilots that the previous Government announced?

[Michael Gove]

I am grateful to the hon. Lady for her question. I know that in her previous incarnation, in the Child Poverty Action Group, she was a committed fighter for the very poorest children. We are now looking to ensure that we can guarantee that those children most in need receive support with free school meals, and we are examining the evidence that has come in from the pilots that she has mentioned.

[Mr Jim Cunningham (Coventry South) (Lab)]

Can the right hon. Gentleman comment on the closure of BECTA, the British Educational Communications and Technology Agency, and the QCDA, the Qualifications and Curriculum Development Agency, in Coventry, costing probably 600 jobs, and the potential impact not only in Coventry but on education for poorer families? A letter was sent out announcing the closure arbitrarily, so what will happen to those staff?

[Michael Gove]

I thank the hon. Gentleman for his question. He, too, is a dedicated fighter for his constituency, and I know how hard he has fought for the interests of the people of Coventry. However, given the difficult state of the public finances and the situation that we inherited from the Government whom he supported, we have had to make some tough decisions. My judgment was that we had to prioritise spending on the front line. That has meant that those bodies—BECTA and the QCDA, which were responsible for spending money not on the front line, but in an arm’s length way, as quangos—have had to accept that economies are necessary. I have ensured, by writing to those responsible for both organisations, that we handle any redeployment and any redundancy in the most sensitive way possible.

[Ed Balls (Morley and Outwood) (Lab/Co-op)]

I am grateful to the right hon. Gentleman for his kind words. Before the interventions started, he confirmed that he had agreed with the Treasury to match the previous plans for spending in the current financial year—2010-11 —for Sure Start, schools and 16-to-19 education. Can he confirm to the House that he has reached a similar agreement with the Chancellor of the Exchequer to match funding for 2011-12 and 2012-13 as well?

[Michael Gove]

The right hon. Gentleman, I am sure with admirable zeal, wants to look into the crystal ball and find out what will happen in future. However, I have to remind him that just six weeks ago, during the general election campaign, he was engaging in his own form of future forecasting. Just six weeks ago, he said that if we took office, there would be 38,000 fewer staff working in our schools, 6,900 fewer teachers in primaries and nurseries, and 7,300 fewer teachers in secondary schools. Those redundancies have not taken place. The Nostradamus of Morley and Outwood was found out. His predictions did not come true. For that reason, I will not enter into any forecasting about what will happen in future years.

What I will say is that unlike the right hon. Gentleman’s Government, we have secured additional funding from outside the education budget, as confirmed by the Prime Minister at this Dispatch Box just an hour ago, in order to fund our pupil premium—something that the right hon. Gentleman was never able to do, but that we have been able to do in partnership—to ensure that funding goes to the very poorest children. I would have hoped that he would find it in himself to show the grace to applaud that achievement for our very poorest children. I would also have hoped that he would applaud the Chancellor for protecting front-line funding for Sure Start, 16-to-19 education and schools.

[Christopher Leslie (Nottingham East) (Lab/Co-op)]

The Secretary of State has been talking about protecting front-line spending in education. Can he confirm that that includes important services such as special educational needs provision and school transport, which are of great value to our constituents?

[Michael Gove]

I could not agree more. School transport is covered by the revenue support grant in almost all circumstances and has not been affected. With respect to special educational needs, we are ensuring that the commitment is there to fund the services that our most vulnerable children need.

What I would say to all hon. Gentlemen on the Labour Benches—[Interruption]—and hon. Ladies too—is that in their requests for more spending, however passionately constructed, they should remember one thing. Who were the Government until just a few weeks ago? Who was responsible for the financial situation that we inherited? Who was responsible for writing a letter to the Treasury saying, “There is no money”? None of us in this House wants to see front-line spending on our schools reduced, but none of us on the Government Benches would have wanted the public finances to be reduced to the state that we inherited after the election. As the right hon. Member for Birmingham, Hodge Hill (Mr Byrne) put it, in a rare moment of candour when he left the Treasury, there is no money left. In fact, as the markets are all too aware, there is less than no money left. We are currently spending £163 billion every year more than we take in taxes—

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

rose—

[Michael Gove]

And that is thanks to the financial mismanagement of the hon. Lady’s Government.

[Meg Hillier]

In the right hon. Gentleman’s desire to be sensible about money, which we would all want to see, will he think about the extended schools programme? What connections is he making with other Departments? That extension to school hours really helps working parents, and working parents help to tackle child poverty. That should be at the centre of his agenda, and I hope that it is.

[Michael Gove]

I pay tribute to the hon. Lady’s commitment to fighting child poverty, both in her role as a Minister and also, previously, as a member of the Greater London assembly. She will be aware that my Department is working with the Department for Work and Pensions and the Department for Communities and Local Government to carry forward the good work that is already in place as a result of the extension of hours, but it is critical to recognise that everything that is happening in and around our schools to support young people is taking place against a backdrop of dire economic news. That backdrop is one that she played a part in constructing when she was a member of the Government who left us with the desperate economic situation in which we find ourselves. Our debt is growing at a rate of more than £300,000 per minute. That money could have been spent on the front line—on our schools, on teachers and on teaching assistants—but it is not being spent in that way, thanks to the profligacy and inefficiency of the Labour Government.

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

The right hon. Gentleman might be having a bonfire of the bureaucracies, but will he acknowledge that many of them are not just bureaucracies and that they actually do an important job in education? We still need curriculum development capacity, for example, and we still need technology to be applied in our schools to advance good learning. There is a rumour sweeping through the corridors that he is about to announce the abolition of the General Teaching Council for England. Is that true? What would be the purpose of that?

[Michael Gove]

Lots of teachers are asking what the purpose of the GTCE is; they have been asking that question for years. I must ask the hon. Gentleman to reflect on where the resources should go. Should they go to quangos or to the front line? He listens to teachers, and I listen to teachers. They want resources on the front line, in the classroom, raising attainment; they do not want them spent on the bureaucratic bodies that have for too long siphoned money from where it needs to be spent.

Critically, I know that many hon. Members will want to ask why we are not honouring their commitment to spend £250 on the child trust fund. Let me take that question head on. When the Labour Government left office, they ensured that every single child was paying £23,000 of debt every year in order to deal with our deficit. Why is it progressive politics to saddle children with £23,000 of debt in order to give them a financial product worth just £250? That is not progressive politics; it is Maxwell economics. Instead of seeking to defend its financial mismanagement, the Labour party should apologise to the House and to the next generation for saddling them with a national debt so huge that it undermines our capacity to make progress.

[Stewart Hosie (Dundee East) (SNP)]

The Education Secretary is right about the level of debt that the Labour party left behind: £1 trillion of national debt is a huge amount. However, to use that as a justification for doing away with the child trust fund is wrong. The child trust fund is the only savings product I can think of with a 71% voluntary take-up rate and, given that savings ratios in this country were so low for so long and that the fund goes directly to help children when they leave school, it is a false economy to butcher the scheme, notwithstanding the chaos and mayhem that the Labour party left the economy in.

[Michael Gove]

The hon. Gentleman answers his own question: the Labour party did leave chaos and mayhem, and the tough decisions that it relentlessly avoided now have to be taken. By refusing to state exactly how it would deal with the public spending mess that it left behind, the Labour party is placing itself outside the European mainstream—[Interruption.] In every major European country, including Ireland, Italy, Germany and Spain, steps are being taken to deal with the deficit. The right hon. Member for Morley and Outwood was a noted Eurosceptic, when he was at the Financial Times and when he was at the Treasury. I note that he is now taking a similarly Eurosceptic position by refusing to join the European consensus that we need to deal with our sovereign debt crisis by bringing down public expenditure. The longer the Labour party is in denial, the longer it will consign itself to irrelevance and the longer it will stay in opposition.

[Mr David Blunkett (Sheffield, Brightside and Hillsborough) (Lab)]

I am grateful to the right hon. Gentleman for giving way, and I congratulate him. In suggesting that other countries are, to use his words, reducing their sovereign debt, is he not admitting—given that he is the Education Secretary and that he can therefore add up—that the previous Labour Government cannot have been responsible for those countries’ debts? Does he acknowledge that they took action in the same way as our Government did to protect us from a meltdown in the system?

[Michael Gove]

I am grateful to the right hon. Gentleman for making the point, as I was arguing, that other countries are taking action now—in this year, even as we speak—to deal with these problems. He stood on a platform, as did the right hon. Member for Morley and Outwood, saying that it would be “folly” to take action this year. That view—that action was required this year—was not put forward only by Conservative Members, as it was the view of the Governor of the Bank of England, who backed early action to deal with the deficit. He said that we needed to

“tackle excessive fiscal budget deficits”

and added:

“I am very pleased that there is a very clear and binding commitment to accelerate the reduction in the deficit over the lifetime of the Parliament and to introduce additional measures this fiscal year to demonstrate the importance of getting to grips with that before running the risk of an adverse market reaction.”

How wise were those words and how welcome is such robustness from the Governor of the Bank of England. Indeed, one newspaper columnist has argued:

“That is why Bank of England independence, once a controversial idea, is now accepted across all parties and by both sides of industry.”

The columnist in question is, of course, the right hon. Member for Morley and Outwood, writing in the Wakefield Express.

[Ed Balls]

It is a great column!

[Michael Gove]

It is a great column and a great newspaper—never was a truer word said. It is against the backdrop of the terrible fiscal position left us by the previous Government, in which the right hon. Gentleman played such a distinguished part, that we have to make our judgments in this Queen’s Speech.

Hard times require tough choices, and we have chosen to put health and education first, not just in terms of spending, but in terms of reform. Unlike the last Prime Minister, we recognise that investment in the front line has to be matched with trust in the front line. That is why, in both health and education, we will devolve responsibility down—away from Whitehall towards schools and hospitals. Power will be taken out of the hands of politicians and bureaucrats, and placed in the hands of teachers, nurses and doctors.

[Mr Graham Stuart (Beverley and Holderness) (Con)]

I am grateful to my right hon. Friend and congratulate him on his new post. The single most important way to raise standards in education is to attract, retain and motivate higher calibre people in teaching and school leadership. What steps will the new coalition Government take to make teaching more attractive and to ensure that we increase the motivation and support of teachers?

[Michael Gove]

My hon. Friend served in a distinguished way on the Select Committee that deals with these matters, and I am sure that he will continue to serve in a distinguished way in the future. He will know that many of the Select Committee’s recommendations chimed with those that we made in opposition, but we need to learn from countries like Finland and Singapore that have succeeded in attracting an ever-more talented group of our graduates into teaching. In fairness to the Government, we have seen over the last 15 years an increase in the number of talented people coming into teaching. We have among the most talented cohort that any of us can remember, but we need to build on it and ensure that organisations outside the reach of Government such as Teach First are given the opportunity to expand; the Government must support them. Unlike the last Government, who refused to fund their expansion to the north-east of England, we will support that expansion while ensuring that the current graduate teacher programme, which is too bureaucratic and puts barriers in the way of those who want to enter teaching, is expanded by turning it into a Teach Now programme. I see from the nods coming from the former Chairman of the Select Committee that he appreciates that there is room for consensus and for constructive work in this area, which unites everyone who is serious about raising teacher quality. [Interruption.]

As well as mentioning the support we enjoy from the hon. Member for Huddersfield (Mr Sheerman), I should say that it is across the piece of public sector reform that our belief in trusting professionals and attracting more talented people into the front line guides our hand. That is why the Health Secretary has said deliberately that our reforms to the health service will be led in future by clinicians and not by bureaucrats. He has called a halt to the reorganisation of health services promoted by his predecessor, so that we can ensure that every change is driven by professional wisdom and not by bureaucratic convenience. That should mean that in communities across the country, the maternity and A and E services that are cherished by our constituents are protected, because clinicians put their needs first. It is also why my right hon. Friend has ensured that in place of the more than 100 targets insisted on by Ministers in the past, we will have a health care system driven by results, not by processes, by clinical evidence, not political whim, and by patient choice, not top-down diktat.

[Bob Russell]

In the spirit of an holistic approach to education and health, may I ask the Secretary of State to look at early-day motion 25, entitled “Fitness of Children”, before the end of the debate, and may I ask whoever sums up the debate to reflect on it? It clearly states that children who walk or cycle to school are fitter than those who are driven in a car or school bus, but everything that the Secretary of State is proposing is literally driving children out of their communities into cars and buses to travel to schools at the other side of town.

[Michael Gove]

I thank my hon. Friend for another constructive contribution. It is true that as I listened to it, the words “On your bike” passed through my head, but I have to say that I agree with him. It is because I believe in community schools and want them to survive that I believe we should work together to ensure that they are saved from the pressure—whatever it is and from whoever it may come—that may lead communities to be robbed of the schools that they love. One of the aspects of the reform programme that we are proposing, which I hope will commend itself to him and to many of my hon. Friends, is our determination to ensure that small schools, urban or rural, can survive where there is strong parental support for them.

The vision that we have for our education and health reforms is driven by the shared values of this partnership Government. We believe in devolving power to the lowest possible level. We believe that the function of the state is to promote equity, not uniformity; to enable, and not to conscript. We also believe that the power of the state should be deployed vigorously to help the vulnerable and the voiceless, those who lack resources and connections, and those who are poor materially and excluded socially.

However, we also believe that those most in need will never be helped to achieve all that they can unless we harness the full power of civil society, the initiative of creative individuals, the imagination of social entrepreneurs, and the idealism of millions of public sector workers. That means reducing bureaucracy, getting rid of misguided political intervention, respecting professional autonomy, and working in genuine partnership with local communities. It is that genuinely liberal, and liberating, vision that unites every Member on this side of the House and gives our reform programme its radical energy, not least in education.

We have—we have been bequeathed—one of the most stratified and segregated school systems in the developed world. The gap in exam performance between private schools and state schools grew under the last Government. That was a reverse for social justice, and an affront against social mobility. In the last year for which we have figures, just 45 of 80,000 young people eligible for free school meals made it to Oxbridge. More students went to Oxbridge from the school attended by the Leader of the Opposition, St Paul’s, than from the entire population of poor boys and girls on benefit.

I know that the consciences of Opposition Members who are motivated by idealism will have been pricked by those figures. No one contemplating that record can be in any doubt that reform is urgent. That is why we are pressing ahead with the sort of changes that will drive improvement across the whole of the state school system. We are cutting spending on the back office to prioritise spending on the front line.

As was pointed out by the hon. Member for Coventry South (Mr Cunningham)—who, sadly, is no longer in the Chamber—we have already saved millions of pounds by taking steps to abolish BECTA and the QCDA—two bureaucratic organisations with their own chairmen, their own chief executives, their own boards, their own communications teams, their own strategies and their own stakeholder groups—so we can ensure that money goes to the classroom. Today I can announce—as the hon. Member for Huddersfield anticipated—that we will take steps to abolish a third quango, the General Teaching Council for England.

The GTCE takes more than £36 from every teacher every year, and many of them have told me that it gives them almost nothing in return. I have listened to representations from teacher organisations—including teaching unions such as the NASUWT—which would prefer that money to be spent in the classroom, and I have been persuaded by them, the professionals. The GTCE does not improve classroom practice, does not help professionals to develop, and does not help children to learn. In short, it does not earn its keep, so it must go.

To those who argue that we need a body to help police the profession, let me say that this Government want to trust professionals, not busybody and patronise them; but when professionals dishonour the vocation of teaching, action needs to be taken. When the GTCE was recently asked to rule on a BNP teacher who had posted poisonous filth on an extremist website, it concluded that his description of immigrants as animals was not racist, and that therefore he could not be struck off. I think that that judgment was quite wrong and that we need new proposals to ensure that extremism has no place in our classrooms, and I also believe that the bodies that have failed to protect us in the past cannot be the answer in the future.

[Mr Blunkett]

There may well be an argument about the role of the GTCE, especially in respect of the example the right hon. Gentleman has just given, but does he agree that it does not behove him as the new Education Secretary to abolish the GTCE on financial grounds, given that the sum of £36 per teacher to which he referred will not be taxed on teachers and therefore will not be money that can be made available to the front line as he stated just a few minutes ago? Is this not the kind of nonsense that got us into having the pledge that £2.5 billion would be saved by doing away with biometric passports, when it turns out that the correct figure is £86 million over four years?

[Michael Gove]

I have great respect for the right hon. Gentleman, but I must point out to him that £36.50 per teacher goes to fund the GTCE, and much of that money actually comes from the Department itself, although some comes from teachers as well. I believe that the money the Department currently spends supporting the GTCE should instead be spent on supporting the front line, because I believe that overall we need to ensure that money that is currently spent on resources such as bodies, institutions, protocols and frameworks that do not raise the quality of teaching and do not improve the experience of children in the classroom should be shifted so that it is spent in the right direction.

[Ed Balls]

Just for the record, can the right hon. Gentleman tell us how much he will save for the public purse by abolishing the GTCE?

[Michael Gove]

I have asked officials to calculate exactly how much we will save. [Interruption.] Well, we will bring forward legislation, but there is a sum of £36.50 for every teacher, which will save us hundreds of thousands of pounds. [Interruption.] Does the right hon. Gentleman believe that the GTCE is the right organisation to keep in place? Does he believe that this money is better spent on the GTCE than in any other area? Does he believe that the hundreds of thousands of pounds that I think we should have spent on the front line should continue to be spent on that body?

[Mr Sheerman]

I rise to try to educate the right hon. Gentleman. As he is very well versed in educational matters, he must know that what he is telling the House is a fiction. The fact of the matter is that he will not be saving £36.50 for every teacher. Many teachers pay the £36.50 themselves.

[Michael Gove]

Some do, but many do not. It is precisely because the Department pays the fees for so many teachers—it pays £33 of the £36.50—that I have asked officials to work out how much we can save. If, instead of simply carrying on objecting to saving this money, the right hon. Member for Morley and Outwood wants to tell me how he would spend it, or whether he would keep the GTCE going, I would be delighted to hear from him.

[Ed Balls]

I remind the right hon. Gentleman that it is he who is now the Secretary of State, not I, and therefore he is the person who has to take the decisions and is responsible. It is not proper government for him to come to the House to make an announcement and for it to turn out that he has not even seen the advice on which the announcement has been made, and then for him airily to say, “Well, I think the figure is hundreds of thousands of pounds.” The right way to do it is to get the information first, then make the decisions, and then report them to the House; that is a better way of doing things.

[Michael Gove]

I am grateful to the right hon. Gentleman for his kind advice, but the one thing he has not done in his question—or statement, even—is point out whether he agrees with the policy. If he will tell me whether he agrees with it, I will be interested to hear his views. We do know, however, that money will be saved, and that introducing this change in respect of this organisation is in the interests of teachers and of making sure that money that is otherwise spent on bureaucratic bodies can be spent on the front line. [Interruption.] I have had the opportunity to read the advice, and I know that this is the right thing to do. [Interruption.] I would be interested in advice from the right hon. Gentleman about whether or not he thinks—

[Mr Speaker]

Order. I am very sorry to interrupt the flow of the eloquence of the Secretary of State, but may I just say, particularly as we are discussing education, that we all believe in the importance of role models, and I am already finding that the behaviour of some senior Members is starting to be imitated by new Members? That is very undesirable, and I know it is not a precedent that the hon. Member for Huddersfield (Mr Sheerman) would wish to establish.

[Michael Gove]

As I am sure the Secretary of State, the right hon. Member for Morley and Outwood, knows—[Interruption.] Forgive me, I should, of course, have said the shadow Secretary of State. How sweet those memories are. As the right hon. Gentleman the shadow Secretary of State knows, the Department provides about £16 million every year to reimburse teachers for the cost of that membership. I believe that that £16 million is better spent on the front line. If he believes that the money is better spent on the GTCE, perhaps he will say so in his forthcoming remarks.

As well as getting rid of that bureaucracy, we will reform other bureaucracies. We will reform Ofsted, the schools inspectorate, so that instead of inspecting schools on the current 29 tick-box criteria, it will examine just four: the quality of teaching; the quality of leadership; pupil achievement and attainment; and pupil discipline and safety. We also want to free outstanding schools from inspection, so that more time and resources can be devoted to helping others to improve. The absurd practice of “limiting judgments”, whereby great schools can be ranked as “poor” because of clerical errors, will end, and inspections will be driven by an in-depth look at teaching and learning, rather than by the current endless paper chase, which deprives classes of teacher time.

[Lindsay Roy (Glenrothes) (Lab)]

I congratulate the Secretary of State on his appointment to a very challenging Cabinet post—it is becoming more challenging by the minute. Does he accept that a key factor in improving attainment and achievement is the quality of learning and teaching? Why would any graduate be able to opt out of a teaching qualification, given that, in my experience, some of the most gifted academics are not the most gifted pedagogues? Is this not a dilution that could have a negative impact on standards and quality?

[Michael Gove]

That was a beautifully read question from the hon. Gentleman. As we know, he is a former headmaster of some distinction—indeed, he was headmaster of the school that the former Prime Minister attended—so I shall listen to what he has to say. It is crucial to ensure that we have high standards of teaching and learning. As I pointed out in a reply to my hon. Friend the Member for Beverley and Holderness (Mr Stuart), we are taking steps to ensure that we improve the quality of both recruitment and teacher training—that is central to our reform programme. That is why we will expand Teach First, institute a new programme called Teach Now and invest in continuous professional development to ensure that those who are currently in the classroom—they are doing a fantastic job—have the opportunity to enhance their skills and accept new responsibilities.

It is because we want to attract more talented people into the classroom that we will also remove the biggest barrier to people entering or staying in the teaching profession; we will focus relentlessly on improving school discipline. We will change the law on detentions so that teachers will no longer have to give parents 24 hours’ notice before disciplining badly behaved pupils. We will change the law on the use of force and enhance teachers’ search powers so that they will be able to prevent disruptive pupils from bringing items into school that are designed to disrupt learning. We will change the law to enhance teacher protection by giving teachers anonymity when they face potentially malicious allegations, and we will insist that allegations are either investigated within a tight time period or dropped. We will also change the law to ensure that heads have the powers that they need on exclusions, and we will ensure that there is improved provision for excluded pupils to get their lives back on track.

I hope that the hon. Member for Glenrothes (Lindsay Roy), and others who believe in protecting teachers and ensuring that we have good standards of discipline and behaviour, can support all those measures. I take it from his headshake that we have his enthusiastic assent. In addition to improving discipline, we will strengthen our exam system. We want to have fewer and better exams. We want to reverse the trend towards modularisation, reduce the role of coursework in certain subjects and ask universities to help us to design new and stretching A-levels that can compete with the best exams in the world.

Just as we plan to learn from the rest of the world in order to improve our exam system, so we will learn from the rest of the world in order to improve our school system. In America, President Barack Obama is pressing ahead with radical school reform on the model that we believe in. He is attracting more great people into teaching, demanding greater accountability for parents and welcoming new providers into state education. He has insisted on having more great charter schools—the American equivalent of our academies—to drive up attainment, especially among the poorest. He, along with other reformers, such as the Democrat Education Secretary Arne Duncan, the Democrat in charge of New York’s schools, Joel Klein, and the Democrat in charge of Washington DC’s schools, Michelle Rhee, wants more schools like the inspirational Knowledge is Power Programme—KIPP—schools, which are raising attainment in ghetto areas. Such schools are founded by teachers and funded by public money, but they are free from Government bureaucracy. They operate in neighbourhoods where, in the past, most children did not even make it to the end of high school. Now, thanks to these KIPP schools, a majority of these young people are going on to elite universities. These schools have a relentless focus on traditional subjects and a culture of no excuses, tough discipline and personalised pastoral care. The schools have enthusiastic staff, who are in charge of their own destiny and work hard to help every child to succeed. Such schools are amazing engines of social mobility, which is why we need more like them in this country.

That is, in turn, why we need to expand and accelerate the academies programme and why we are reforming state education to help groups of teachers, charities, philanthropists and community groups to set up new schools. It is also why I have been determined to give professionals more scope to drive improvement by inviting all schools to consider applying for academy freedoms. We have invited outstanding schools to lead the way.

I believe that heads and teachers, not politicians or bureaucrats, know best how to run schools, which is why I am passionate about extending freedom. Since I issued my invitation last week, I have been overwhelmed by the response. In less than one week, more than 1,100 schools have applied for academy freedoms, more than half of which are outstanding—626 outstanding schools, including more than 250 outstanding primaries. More than half the outstanding secondary schools in the country have applied, and more than 50 special schools have expressed an interest. That is a vote of confidence in greater professional autonomy from those driving improvement in our schools—inspirational head teachers.

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

Does the Secretary of State acknowledge that it is dangerous, and certainly misleading, to use terms such as “outstanding” to describe schools when the evidence and research show overwhelmingly that the single most important determinant in success and attainment is the deprivation levels among parents of the children in a school?

[Michael Gove]

I take my hon. Friend’s point that deprivation matters, which is why we have secured a partnership agreement guaranteeing that deprived pupils receive more for their education. I believe in the pupil premium and the progressive alteration to education spending. However, deprivation does not automatically mean destiny. As has been pointed out, there can be outstanding schools with challenging intakes, and what marks them out is the quality of their leadership, which is why it is so inspiring and encouraging that so many great head teachers, including of schools in some of the most challenging circumstances, have endorsed our proposals.

[Bob Russell]

Does the Secretary of State consider that the rush for freedom, as he would describe it, is perhaps more a vote of no confidence in local education authorities, which are predominantly Conservative—for example, Essex county council, which totally ignores the views of my constituents?

[Michael Gove]

Once again, my hon. Friend makes the sort of constructive contribution that I know will make our encounters over the next few years things to cherish. I say to him that it is across the board, whether under Conservative, Liberal Democrat or Labour-led local authorities, that schools want to embrace freedom. Many of them want to do so, not because they resent or are critical of local authorities, but because they relish the additional autonomy and freedom to disapply parts of the national curriculum, and because they want to work in partnership with existing schools. I want to encourage that sort of partnership, between our two parties and between academies and local authority schools. That is why I have requested that every outstanding school that acquires academy status takes with it an underperforming school on its journey, so that the process of collaboration, with the best head teachers driving improvement, continues, and so that schools can use academy freedom and head teachers can use additional powers to ensure that every child benefits.

In addition to asking that of outstanding schools, we will ensure that the academies programme delivers faster and deeper improvements in deprived and disadvantaged areas. Many more of our weakest schools will be placed in the hands of organisations such as ARK, the Harris Foundation and other academy sponsors best placed to drive improvement. We will also ensure that parents have more information about all schools, so that pressure grows on schools that are coasting to improve, and work in partnership with local government, from Essex to Cumbria, empowering strong local authorities to continue to drive improvement. Most importantly, as I have pointed out, we will target resources on the poorest. Our pupil premium will mean taking money from outside the schools budget to ensure that those teaching the children most in need get the resources to deliver smaller class sizes, more one-to-one or small group tuition, longer school days and more extracurricular activities.

[Lindsay Roy]

Apart from outstanding schools, special needs schools and some failing schools, what are the criteria for acceptance to the academy programme?

[Michael Gove]

Schools must demonstrate that the acquisition of the freedoms will help drive attainment for children in that area, and that it will also work for other schools.

This is a comprehensive plan to ensure that our state education system is the best in the world, and it is informed by what is happening across the world. Sadly, in the past 10 years, we have fallen behind other countries: we have slipped from fourth to 14th in the world for the quality of our children’s science; from seventh to 17th for the quality of their literacy; and from eighth to 24th for the quality of their maths. We cannot go on like this. While other countries accelerated their reform programmes in the past three years, we went into reverse. In the past three years, the outgoing Government added thousands of pages to the bureaucratic burden faced by schools. They robbed academies of vital freedoms and tried to abolish traditional subjects such as history and geography in the primary curriculum. They created an inspection regime that stifled innovation, failed to take proper action against extremism in the classroom and prevented teachers from searching for disruptive mobile devices and hardcore pornography on so-called human rights grounds.

The previous Government did make progress in certain areas. The former Secretary of State published his own cook book, “Real Meals”— two, in fact—which was distributed to every school in the land. In the words of the Speaker, when opening the debate on the Queen’s Speech, I have “obtained a copy” for the better understanding of the House. Right hon. and hon. Members may wish to read it during our deliberations this afternoon to get a better understanding of just what he was doing for much of his time in office. Certainly, time spent familiarising oneself with his recipes will not be wasted. I am sure that many of us will be captivated by the eye-watering sight of his mighty muffins in full colour on these pages. I have to say that the shadow Secretary of State certainly has a beautiful set of buns. May I congratulate him for striking a blow against elitism with his cook book? For the first time in history, a socialist Government’s response to poor achievement was, “Let them eat cake.”

[Mr Kevin Barron (Rother Valley) (Lab)]

I welcome the right hon. Gentleman to the Dispatch Box. He will know that the last Conservative Government stopped nutrition in school meals. Is it not true that that cook book and many other things that have happened in the past 10 years have put it back in for the benefit of children?

[Michael Gove]

I am delighted that the right hon. Gentleman believes that the first responsibility of the Secretary of State for Education is producing mighty muffin recipes. I take a different view. I do not want to take anything away from the right hon. Member for Morley and Outwood’s achievements in the kitchen.

[Sammy Wilson (East Antrim) (DUP)]

I support the outline that the right hon. Gentleman has given for freedoms for schools, but how will he ensure that there is not too great a burden on schools when he wants to find out how they spend their money, how they are governed, whether they have raised standards, how they select pupils and a whole list of other things? How will he ensure that that does not lead to a lot of interference by his Department requiring information from schools that seek freedom?

[Michael Gove]

I have a great deal of sympathy with the hon. Gentleman. I know, of course, that there is a separate Minister who is responsible for education in the Province that he so ably represents. Earlier in my speech, I mentioned briefly—and I am happy to expand on this in a private meeting—that we will reduce the bureaucratic burden on schools by asking Ofsted to focus on teaching, learning and three other areas. In many of the areas in which it currently acts as a bureaucratic, box-ticking, information-collecting body, the requirements on it will be scaled back.

Returning to the right hon. Member for Morley and Outwood, I do not want to take anything away from his achievements, because the most stinging criticisms of his record have not been made by me but have come from his own side. The shadow Foreign Secretary has complained again and again in the past few weeks that in the past few years Labour “lost focus on education”. He has also complained that Labour lost the mantle of reform and therefore forfeited its claims to be progressive. In the spirit of cross-party co-operation, I have to say that I agree with David. The Department did lose focus, reform did go backwards and progress did stall. The radical energy that infused the Labour Government’s programme in 2005, which was embodied in the White Paper of that year, was lost and in its place came the Brownite politics of dividing lines, partisan positioning and misplaced aggression. We are determined to put that to one side and push forward a programme of radical reform.

What do we want to do? Let me quote:

“We need to make it easier for every school to acquire the drive and essential freedoms of Academies, and we need to so in a practical way that allows their rapid development to be driven by parents and local communities, not just by the centre…We want every school to be able quickly and easily to become a self-governing independent…school”.

Who said that? [Interruption.] Not me, but as the former Minister for Schools, the hon. Member for Gedling (Vernon Coaker) has just said—10 out of 10—it was the former right hon. Member for Sedgefield, who is sadly no longer in this place, Tony Blair. He said:

“In our schools…the system will finally be opened up to real parent power.”

He argued that all schools would be able to have academy-style freedoms and should be able to take on external partners. He said that no one should be able to veto parents from starting new schools, or veto new providers coming in, simply on the basis that there were local surplus places. He promised a relentless focus on failing schools and that Ofsted would continue to measure performance, albeit with a lighter touch. He said that schools should be accountable not to Government, but to parents, with the creativity and enterprise of teachers and school leaders set free. Those promises were made in 2005 but, sadly, they were never honoured, because of the opposition to the White Paper and the legislation that was led from the Back Benches by the right hon. Member for Morley and Outwood and his allies.

Presciently, the former Prime Minister anticipated the criticisms that he would face, and which were mounted by the right hon. Gentleman. He said:

“The reforms will naturally come under sustained attack…Parts of the left will say we are privatising public services and giving too much to the middle class.”

He added that

“both criticisms are wrong and simply a version of the old ‘levelling down’ mentality”

that kept Labour in opposition for so long. As long as the Labour party continues to stand in the way of reform, it will condemn itself to continued Opposition.

Labour Members have a choice: will they continue to be a party of no, of the status quo, of carping, nostalgic, backward-looking criticism, always resisting innovation in the name of vested interests instead of pressing for change in the interests of the poor? Or will they join us in a forging ahead, after five wasted years, with a resumption of radical reform? Will they join us in giving professionals more power, the poor more resources, and every child a better chance?

I commend this Gracious Speech to the House.

17:21

[Ed Balls (Morley and Outwood) (Lab/Co-op)]

I congratulate the right hon. Member for Surrey Heath (Michael Gove) on his new role as Secretary of State for Education. It is a huge honour and a great privilege, but also a great responsibility.

I know that driving up education standards is a goal that we all share. The words “children” and “families” no longer appear in the name of his Department, but I hope that the Secretary of State and his Front-Bench team will commit themselves to giving every child the best start in life, and to breaking down all the barriers to the progress, safety and well-being of all children in our country. I can tell the House that, when the Secretary of State gets it right—when he acts to open up opportunities for more children and drive up standards for all—he will have our full support.

We did not agree on everything over the past three years—and neither does it seem that I will get his nomination in my party’s leadership election—but we always had an open and honest relationship. I am sure that the whole House will join me in wishing him all the best in his new role.

I thank the Secretary of State for the generous remarks that he made about me, at least at the beginning of his speech. On behalf of all Ministers at the former DCSF in the last three years, I pay tribute to all those with whom we worked so closely to implement our children’s plan. I think that the right hon. Gentleman will find that the civil servants in his Department are the very best in Whitehall, and that his permanent secretary is second to none. He will also find that our country’s social workers, and those working for local authorities and in the voluntary sector, as well as those in the children’s and family services, are distinguished by their dedication and professionalism. He will discover too that, in our head teachers, teachers, teaching assistants and support staff, our country has the best generation of educators that it has ever had.

While I was worried by the new-found enthusiasm of the right hon. Member for Yeovil (Mr Laws) for cutting the youth jobs fund, and for immediate and rather drastic cuts to local government spending this year, over the last three years he was a dedicated and wise spokesperson for the Liberal Democrats in opposition. I am sure that the whole House will join the Secretary of State in wishing him well, and I expect that we will see him back on the Front Bench at some point.

Indeed, the children and teachers of our country have rather more to thank the right hon. Member for Yeovil for than they probably realise. For the past two years in opposition, the new Education Secretary was unable to pledge to match our education spending for 2010-11, let alone for future years. We all know why: the former shadow Chancellor would not support him in making that pledge.

In this debate, we will hear from my right hon. Friend the Member for Leigh (Andy Burnham), the shadow Health Secretary, who achieved great things in protecting our vital national health service for the future. He will set out why he fears that the reforms proposed by the Government in this Queen’s Speech will be a backward step for the NHS. The NHS and international development were protected by the then shadow Chancellor from spending cuts this year. In his speech, the Secretary of State tried to divert attention from the threat in future years to the schools and children’s budgets by pointing to our economic record.

For the record, first, it was our Government who made the Bank of England independent in the face of opposition from the Conservatives, and took the tough decisions to get our national debt down lower than that of France, Germany, Japan and America before the financial crisis. Secondly, it was our Government who led the worldwide effort to stop a global financial collapse turning recession into depression, again in the face of bitter and wrong-headed opposition from the Conservatives. While the right hon. Gentleman may now pray in aid the loyal support of the Governor of the Bank of England and the German Finance Ministry in advocating immediate and deflationary spending cuts to reduce the deficit faster this year, he and his Chancellor are out of step with worldwide opinion and are running grave risks with the recovery, jobs and our vital public services.

For the past two years, the right hon. Gentleman was unable to match our schools spending this year. Then came the intervention of the right hon. Member for Yeovil who, in the days after the general election, stepped in and saved the day by securing ring-fencing for 2010-11 for the schools budget. Let me give the Secretary of State some gentle advice based on experience. It is rather dangerous to rely on the Chief Secretary to the Treasury to fight his public spending battles for him. Moreover, with the right hon. Member for Yeovil now out of the Treasury, let me say to the Secretary of State—this may come as some surprise, although I mean it sincerely—that I stand ready. If he needs a little help with how to win arguments with the Treasury in the next couple of years, I am here to help.

In office, the Labour party achieved, as I think the right hon. Gentleman generously acknowledged, some good things in education over the past decade. We doubled spending per pupil, we had 42,000 more teachers and the biggest school building programme since the Victorian era, and we went from one in two schools not making the grade in 1997 to just one in 12. We had more young people staying on in school, college or an apprenticeship or going to university than at any time in our history. That is a record of which Labour can be very proud indeed.

However, in the tough current financial climate in which we need to get the deficit down steadily, I agreed last December with the Treasury that there would be rising spending above inflation for schools, Sure Start and 16-to-19 education not just for one year, but for three years to 2013 because I was determined to fight my corner for the future of the children and young people of our country. I can assure the Secretary of State, now that the roles are reversed and he, not me, is doing the negotiating, that if there is anything I can do to help him secure the best deal for children, schools and families, not just this year but in the next three years, I will play my part, although it is his responsibility.

From what we heard today, no assurances at all for 2012 and 2013 have been communicated to the right hon. Gentleman by the Chancellor of the Exchequer. Nor does he seem to have received any assurance that the pupil premium, his free schools and his new academies will be met with additional funding from outside his departmental budget. I hope he has some assurances from the Chancellor. If I were in his place, I would make sure I had them in writing.

[Michael Gove]

I know that the right hon. Gentleman may have been otherwise engaged during Prime Minister’s questions, but the Prime Minister pointed out that funding for the pupil premium would come from outside the education budget.

[Ed Balls]

But I asked whether the funding for schools, Sure Start and 16-to-19 education would be guaranteed to match our rising spending above inflation in 2010-11, 2011-12 and 2012-13. What we discovered from the right hon. Gentleman was that he does not have those assurances for the next two years—this year maybe, thanks to the right hon. Member for Yeovil, but for the next two years he said we would have to wait and see.

I shall come to the issue of funding. Given that the Secretary of State spoke for 50 minutes and rather a lot of hon. Members want to make their maiden speeches, I will be briefer, but I will take a couple of interventions and try to resist promising a meeting with the former Schools Minister.

[Bob Russell]

The shadow Secretary of State mentioned all the good things that new Labour had done for children, but does he agree that after 13 years of a new Labour Government, levels of child poverty in this country were among the worst in Europe, worse even than those to be found in Latvia, Lithuania and Estonia?

[Ed Balls]

I am happy to get into robust debates and look forward to seeing the hon. Gentleman defend his coalition, but between 1979 and 1997 the party that he is now propping up in government saw child poverty double. From 1997, we had one of the fastest falls in child poverty of any country in the developed world because we prioritised money going to tax credits, which the Conservative party is now putting into question, and his party as well. We will wait and see what the record shows when his party has had a chance to make a few decisions, but I am a bit of a sceptic about what it will do for child poverty.

Let me come back to money, because, as I said, without the promise of extra and rising resources, not just this year but next year and the year after, I do not see, on the basis of my experience, how it is possible for the new Government to fund free schools and more academies without cutting deep into the budgets of existing schools to pay for it. Even with the settlement that I negotiated, which had within it £1 billion of efficiency savings passed to the front line, it was tough for us to be sure that we would protect front-line staff, and that was before the new schools, the new academies and the thousands of extra places that the Secretary of State wants to finance, and even before the pupil premium, which I understood was to be paid for by abolishing the child trust fund, but that has now been used to cut the deficit, so that is one source of money that has been taken away from the right hon. Gentleman.

My first question therefore is where will the money come from? We have already seen parents, teachers and head teachers throughout the country planning for long-awaited new school buildings. I have lost count in the last two weeks of the number of Members, not just from my side of the House, asking what will happen to the Building Schools for the Future programme and the months of work, the thousands of pounds spent and the raised expectations in 700-plus schools that thought they were getting their new school and now find that it is at risk. We had no reassurance today from the right hon. Gentleman or in Prime Minister’s questions from the Prime Minister about the future of those new school building plans. All we have heard so far from the Secretary of State is a promise of £670 million of cuts from his Department this year to help reduce the deficit in 2010-11. Even then, he provided almost no details.

When I set out efficiency savings in March, I specified the £300 million I had found and said that I needed to find more. So far there has been no statement to the House and no details have been set out. There are hints of cuts to school transport through the local government line and to one-to-one tuition, but there is no detail at all. This is not good enough. The right hon. Gentleman is in government. It is he who must answer the questions now when he is making these big policy announcements. In passing, we would also like to know—we will ask this at Question Time next Monday—how the £1.2 billion of in-year cuts to local government services this year will impact upon vital children’s services such as child social work, libraries and looked-after children.

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

Does my right hon. Friend agree that the Building Schools for the Future programme is vital not only for the welfare of the future skills and education of our children, but for the construction industry, whose welfare is vital for sustaining the employment, the tax levels and the corporation tax necessary to pay off our public debt?

[Ed Balls]

Yes. Back in February, we thought that it was one of the shadow Schools Minister’s flights of fancy. We never realised that he was serious when it was suggested that, despite schools being almost at the point of signing the forms, when the work had been done and the contractors pretty much hired, at the last minute all would be put on hold. That dashes expectations for children and it takes away contracts and jobs. All we heard from the Secretary of State was that it was important that we built new free schools somewhere else. It is no satisfaction to know that there will be a new school down the road for some parents, if another school, which was planned to be rebuilt, is suddenly put on hold. That is a reality for 700-plus schools all round the country.

[Michael Gove]

The right hon. Gentleman painted a devastating and damning picture of people who had been expecting capital funding but were denied it. That is exactly what happened under his Government, when the Learning and Skills Council left colleges unbuilt and denied principals cash. Precisely the picture that he paints, and which he says is bleak, was delivered under his Government.

[Ed Balls]

And the right hon. Gentleman is not the only one who can abolish quangos, but I have to say to him that back in 1997 no money was being spent on further education. There is £2 billion-plus being spent on further education capital projects now, so we are not going to take any lectures from the Conservatives on new school buildings or new further education colleges. Under their previous Governments, such schools and colleges were starved of resources.

Then we hear that, along with the free schools and the new academies, they are going to fund the new pupil premium. However, people will ask, “Where is the money going to come from?” I have seen some of the past advice, and I know how difficult it is to find the money to pay for such measures, so if I had to make an estimate I would say that an additional £1 billion a year is going to be needed if the pupil premium is to have any meaning.

Where will the cuts fall to pay for the pupil premium? Will the right hon. Gentleman scrap the extension of free school meals? Will he scale back one-to-one tuition and the Every Child a Reader programme? Will he cut education maintenance allowances? Will he cut the budgets for disabled children, for children in care, for youth services, for school sport and for school music? Will he scale back the 15-hour offer for three and four-year-olds? Will he abolish free nursery care for two-year-olds?

Where is the money going to come from? I do not expect answers today, but we will need answers soon. The difference between the right hon. Gentleman in opposition and now in government, as we found earlier, is that there is nowhere for him to hide. He will have to answer those questions and my advice is to him is, “Read the advice before you start making statements in the House,” because if he does not he will find that he gets into trouble very quickly indeed. Indeed, he can no longer rely on the right hon. Member for Yeovil being in the Treasury to bail him out on spending issues.

The right hon. Member for Yeovil might have ridden to the rescue to support the Secretary of State on protecting schools spending, but on other aspects of Conservative education policy he was withering: he called the right hon. Gentleman’s free schools policy a “nonsense”; he said that having a strict national curriculum for some schools while letting others opt out was “dotty”; and we all recall his views on the elitist policy whereby only people with a 2:2 or above would be allowed to go into teacher training. The new Schools Minister, the hon. Member for Bognor Regis and Littlehampton (Mr Gibb), seemed to go even further down the elitist road in recent weeks. He said:

“I would rather have a…graduate from Oxbridge with no PGCE teaching than a…graduate from one of the rubbish universities with a PGCE.”

We need to know whether that is a statement of Government policy. If so, which are those “rubbish” universities? We need to see a list.

I agree with the Minister for Universities and Science, the hon. Member for Havant (Mr Willetts)—I hope the Secretary of State does, too—that we can be proud of our university sector in all its diversity. My advice to the Education Secretary is, disown the Schools Minister—it probably will not be the last time that he has to do so during this Parliament—and join me in saying that we welcome as teachers excellent graduates from all our universities.

Whatever university the Secretary of State attended, however, he is a very intelligent man, and I know that he will be delighted, as always, to show us all once again just how very, very clever he is. For that reason, I have prepared for him another Queen’s Speech quiz. I know how much he enjoyed the last one, but given the Schools Minister’s presence why do we not play “University Challenge”?

Here is their starter for 10—no conferring on the Front Bench. Who this weekend said:

“The free schools are generally attended by children of better educated and wealthy families making things even more difficult for children attending ordinary schools in poor areas”?

Gove, Lady Margaret Hall? It was Mr Ostberg, Mr Bertil Ostberg, as the right hon. Gentleman should know, the Swedish Education Minister.

Let us try again. I have an easier one this time. Here is their starter for 10—definitely no conferring at all this time. Who in April described the new Conservative-Liberal Government’s proposed free schools policy as a “shambles” and went on to say:

“Unless you give local authorities that power to plan and unless you actually make sure that there is money available…it’s just a gimmick”?

I am going to have to hurry them. Yes, Teather, St John’s, Cambridge. It was in fact the hon. Member for Brent Central (Sarah Teather), the new Minister for Children and Families. In recent months, the Education Secretary’s new Front-Bench colleague has made some notable speeches—notable in retrospect, at least. Back in March, she told the Liberal Democrat spring conference:

“The Tories don’t know what they are talking about. They have no idea how the other 90% live. Scratch the surface and the old Tory party is alive and well.”

[Interruption.] There is more. She also told her party conference last September that the Tories’

“only motivation is that they think it’s their turn. They don’t really think they can make things better. All they believe is that they have a right to rule.”

Of course, they are ruling only because the hon. Lady and her Liberal Democrat colleagues put them into power. I only wish I was attending the ministerial team meetings to see the sparks fly. There is a serious point here. As we now know, on education policy this Government are divided from the start. It is not only the new Minister who needs to be persuaded that this new-schools policy is not an uncosted shambles, to use her word.

It will be no surprise to the Secretary of State that we Labour Members have very serious reservations about his lurch in education and academies policy. It is reported that he has written to 2,600 outstanding schools, inviting them to become what he calls academies. They are told that they will get extra funds—funds that are currently being spent on special needs, school food, transport and shared facilities such as music lessons, libraries or sports facilities. At no point in his proposal does the Secretary of State explain the impact that that may have on other local schools.

Where our academy policy gave extra resources and flexibility to the lowest-performing schools, the new Secretary of State proposes to give extra money to his favoured schools by taking money away from the rest. Where our academies went ahead with the agreement of parents as well as of local authorities, the new Secretary of State is proposing in legislation to abolish any obligation on schools to consult anyone at all before they become academies—no one will be consulted, including parents and local authorities.

We brought in external sponsors such as universities to raise aspirations, but we were clear that profit-making companies were not welcome to sponsor academies. However, the right hon. Gentleman is abolishing the requirement to have sponsors at all and encouraging private companies to tout around the country to parents, offering their services for profit to provide education. Our academies were non-selective schools in the poorest communities, but his new academies will be disproportionately in more affluent areas and he will allow selective schools, for the first time, to become academies too. Where we used accredited schools groups to encourage school-to-school collaboration to raise standards, he is allowing schools to opt out and go it alone.

The policy is not an extension or even a radical reshaping; it is a complete perversion of the academies programme that the right hon. Gentleman inherited and that my noble Friend Lord Adonis and I drove through in government. It is not a progressive policy for education in the 21st century, but a return to the old grant-maintained school system of the 1990s. It will not break the link between poverty and deprivation, but entrench that unfairness even further, with extra resources and support going not to those who need it most, but to those who are already ahead. My very real fear is that that will lead to not only chaos and confusion, but deep unfairness and a return to a two-tier education policy as the Secretary of State clears local authorities out of the way and then encourages a chaotic free market in school places.

I am not the only one who is concerned. Let me quote the chair of the Local Government Association, Margaret Eaton. I am sorry; I should have said the new Conservative peer Baroness Eaton, who said:

“Safeguards will be needed to ensure a two-tier education system is not allowed to develop”.

Those are very wise words, and such concerns are widespread in local government and across the school system. Will schools that do not become academies pay financially for those that do? Will the admissions code apply to new academies and be properly enforced? Will academies co-operate, as now, on behaviour policy, or will the Secretary of State allow high-performing schools to exclude pupils as a first resort, without any role for local authorities, Ofsted or children’s trusts? Will he step in if things go wrong in what will be a massively centralised education system and how can he reassure us that disadvantaged children will not lose disproportionately from the resources for wider children’s services that will be transferred from local authorities to high-performing opt-out schools, as they take the money away with them? Those are the questions to which we will want answers. We will return to these issues in much greater detail in the coming weeks as he tries to rush his Bill on to the statute book.

I want to make clear to the House what sort of Opposition we will be on education and children’s services. There are cuts that have to be made, and we will support them, as I did before the election in outlining cuts to a range of non-departmental bodies. When the right hon. Gentleman gets it right, we will support him. When he is genuinely supported by teachers and parents, we will support him too. On some of the very difficult issues that will pass across his desk—some of the most sensitive issues that the Government have to deal with on a daily basis, as I know—he will have our understanding and our support. However, I have to say to him that every school building that this Government cancel, this Opposition will fight against tooth and nail; every programme vital to ensuring that every child succeeds, this Opposition will defend; and every individual child’s future that this Government put in jeopardy through their programme of immediate cuts, whether directly by abolishing the child trust fund or indirectly by attacking local government funding, this Opposition will oppose. That is because we believe that every child matters, not just every other child. The right hon. Gentleman may have changed his Department’s name, but we will not let him duck his responsibilities.

[Several hon. Members]

rose—

[Mr Deputy Speaker (Sir Alan Haselhurst)]

Order. I remind the House that Mr Speaker has placed an eight-minute limit on Back-Bench speeches, which operates from now on. Any hon. Member who can speak within that figure will be doing a great favour to many others who are on the list.

17:46

[Mr Stephen Dorrell (Charnwood) (Con)]

I listened with interest to the speech by the right hon. Member for Morley and Outwood (Ed Balls). His case appears to be that the previous Government did no wrong and, in particular, that their economic policy represented global leadership and error-free judgments. If that is the basis on which he seeks the leadership of his party, I can only say that I wish him well.

I warmly congratulate my right hon. Friend the Member for Surrey Heath (Michael Gove), the new Secretary of State, on his appointment and on the way in which he spoke of the things that we have in common within the parties supporting the coalition Government and of the programme that the coalition Government have set before Parliament and the country, particularly on the reform of public services. There is obviously no doubt about the principal domestic challenge that faces the coalition: the fact that the deficit that we inherited from the previous Government is unsustainable and must be reduced. That is a matter not simply of accountancy but of creating the stability that is necessary to allow the process of wealth creation to be reignited and, particularly for the purposes of this debate, to provide the stability that is necessary if we are to secure our common objective of delivering high-quality public services. That is the core challenge facing the new Government.

A second challenge of equal importance to the country and to this House is the securing of our common objectives for the delivery of public services. That is a major opportunity for the coalition, because it represents a failure of our predecessors to deliver our constituents’ objectives in health and education. It is also an opportunity for the coalition, as my right hon. Friend made clear in his speech, because within the coalition we share a commitment to a more localised and less bureaucratic approach that accords significantly greater respect to the professional people who work in those services.

I want in particular to talk about how those ideas are applied to the national health service. Let me begin with a brief piece of history. June 1990, exactly 20 years ago, was the month in which the purchaser-provider split was first legislated and brought into action in the health service. At that time, the introduction of accountability to purchasers was seen as an important means of driving accountability and quality into the health service, eliminating unaccountable practice variation and improving value for money.

The Select Committee on Health in the previous Parliament conducted an audit and progress review of where we had got to in achieving the objectives that were originally set out for the purchaser-provider process, which is now called commissioning. That report makes depressing reading. In today’s health service, commissioning is seen as over-bureaucratic and as too much of a box-ticking process. The power still lies with the provider, and worst of all, the process is seen as excessively expensive and certainly not delivering the objectives that were originally set out for it 20 years ago. The Select Committee report poses the question whether we should therefore give up on the principle of commissioning and, by implication, although it does not say this, go back to a tradition of central planning. I hope that that is an entirely rhetorical question, and I am pleased to say that I believe my right hon. Friend the new Secretary of State for Health thinks so.

To give up on the principle of commissioning would be to give up on the requirement to set priorities and make resources follow those priorities, and on the principle of accountability. In short, it would be to give up on the ideals on which the health service was originally founded. I am pleased that the Queen’s Speech makes it clear that the coalition and both parties within it are committed to following through the logic of empowered commissioning and to making the idea work and be successful.

I offer my right hon. Friend four thoughts on how to deliver that objective, all of which are in the coalition agreement. The first way is through greater local engagement, including with general practitioners, and the involvement of elected members in primary care trusts. That is needed so that local communities understand what is being done on their behalf. Secondly, we need greater engagement by the professions so that commissioning in the health service is not something that is done to professional people by managers but something that engages the professionals themselves in securing the objectives that we as lay people, and even more importantly the professionals themselves, have for the health service.

The third objective is that commissioning needs to be outcome-focused, so that we justify what we do in the health service through improved outcomes experienced by patients. Fourthly, there is an idea that the previous Government canvassed on but never followed through. We need to look for opportunities to bring external support into the commissioning process rather than imagine that we have the capacity in the NHS on an entirely home-grown basis. We need to bring in outside expertise from both within this country and overseas.

There is no party divide in the House about the principles on which the health service was founded. The Labour Government increased the resources available to the health service on an unprecedented scale, but they never followed through in a sustained way with the discipline required to deliver value for money and high-quality health care in return for those resources. That opportunity is open to the coalition—to maintain the resources available to the health service, as it is committed to do, but to add the commitment to deliver the results that, both as taxpayers and as patients, our constituents want the service to deliver.

17:54

Mr Kevin Barron (Rother Valley) (Lab): I start by saying that I intervened on the Secretary of State for Education when he mocked a school book that encouraged children to eat more nutritionally. I admired the Conservative party when it was in Opposition for wanting to reduce health inequalities in this country, but I say to Government Members today that when considering issues such as childhood obesity, if we do not encourage children to eat more nutritionally—no matter whether that is done at school, at home or anywhere else—we will never get anywhere near to reducing health inequalities. We should not mock such ideas, we should support them.

I wish to mention two health issues that the Secretary of State for Education raised, one of which was that of trusting clinicians. In the previous Parliament, I chaired the Select Committee on Health—indeed, I have been involved in public health issues in Parliament for most of my years as an MP—and I have to say that, occasionally, some parts of the national health service and some clinicians give the distinct impression that they would not have wanted any of the changes made since 1948. We therefore need to be careful about that matter.

I am not saying that we should not take clinicians along with us when dealing with the issue. The noble Lord Darzi did so in his next stage review. He engaged thousands of clinicians to ensure that improvements were made. However, there were still people on the ground opposed to such things as the seven-days-a-week, twelve-hours-a-day opening of primary health care centres so that people could see a GP. We should learn lessons from the recent past about the attitudes of some professional bodies.

The Secretary of State mentioned health targets. If any of my constituents go to their local district general hospital because they want a new knee or hip, the wait is measured in weeks—perhaps 18 weeks, or a lot less in South Yorkshire at the moment depending on where they go. Not long ago, the wait was 18 months or more and the consultant in the hospital concerned—the same surgeon who would have done the operation on the NHS—would say to patients, “If you want to have a new knee, I can do it next week at a private hospital in Sheffield if you’ve got £3,500 lying around that you want to get rid of, or you can wait 18 months or two years with a poor quality of life because of the pain.” Targets have been set to help all our constituents with their health needs, and we should ensure that if they are removed it is not to the detriment of the massive improvements that have been made in health care over the past 10 years.

Right up until the general election, the Conservative party was considering putting in place what was effectively private insurance cover for social care. The Health Committee published a report on adult social care and particularly care for the elderly. The idea expressed by the Conservatives only a few months ago was that people in my constituency who retired could find £8,000—or £16,000 for a couple—to pay into a scheme so that they would have their care needs met in future years, which is an unbelievable concept. The Health Committee did not exactly praise the previous Government, as my right hon. Friend the Member for Leigh (Andy Burnham) will remember. However, in the report on adult social care, we said that there needed to be a consensus about the way forward and how the system should be paid for so that it was fairer than the current system. I am pleased that the new coalition has said that it wants to set up a commission to achieve that, but it should not wait longer to deal with the matter than it has to. Let us get the matter sorted out in this Parliament and get some fairness into the system as soon as practicable, when the commission has met and reported. Without consensus across the House, the unfairness and inequity in social care in this country will carry on for ever and a day.

The National Institute for Health and Clinical Excellence has today made a recommendation on the minimum pricing of alcohol. I believe that the recommendation stands up well, and indeed, the Health Committee felt in most part that minimum pricing was the best way to deal with the alcohol problem. The recommendation has been made by an independent institution that has examined the effect that such a policy would have on alcohol consumption. It disagrees with what the alcohol industry has been saying in and around this place for many years—that minimum pricing will not stop binge drinking. I ask people, and especially Ministers, to read the NICE report. I am convinced, as were most members of the Health Committee in the previous Parliament, that the minimum pricing of a unit of alcohol is crucial if we are to take control of alcohol consumption in this country. There are other means of doing so, and people have argued that for some time.

The previous Government introduced regulations in April to stop the practice of students being invited into nightclubs where, for £10, they could drink all night. The Channel 4 News website says today:

“At Dukes nightclub in Essex, the owner Lou Manzi told Channel 4 News that they had stopped all you can drink for £15 and were now offering 15 drinks vouchers for £15, which they believed complied with the new rules.”

People will always try to get round any new rules, but the market cannot get round price. It worked to reduce consumption of cigarettes, and we have a far healthier population as a result. This Government will need income at some stage, and a minimum price for a unit of alcohol is the way forward if we are to stop alcohol abuse. More than 1.3 million children suffer because of alcohol abuse, and we cannot carry on thinking that education will make any difference. We have tried that, but we have failed. We have failed the nation, especially those children, and action needs to be taken by this Government to ensure that we price alcohol sensibly to bring some common sense back to consumption.

18:01

[Mark Lancaster (Milton Keynes North) (Con)]

It is a pleasure to be able to contribute to this debate. I am certainly seeing the benefits of the election, as I think that this is the first time that I have been called to speak before 9 pm in the five years that I have been here. It is also a pleasure to follow the right hon. Member for Rother Valley (Mr Barron), who was an excellent Chair of the Health Committee in the last Parliament. I regard him as a friend and he did a sterling job.

I wish to thank my right hon. Friend the Secretary of State for Health for coming to visit Milton Keynes hospital yesterday. I said during my election campaign that I would make health my priority and, in the past two years, we have had some particular problems in Milton Keynes at the maternity unit. It was very reassuring to have my right hon. Friend visit yesterday and to see that the hospital, which is desperately trying to do the right things to put matters right, will have the full support of the Department of Health in trying to deliver the positive change that we all want to see.

I shall address three issues—the funding formula, targets and waste. NHS funds are allocated to primary care trusts on the basis of a complex weighted capitation formula. The allocation is based mainly on the number and age distribution of a PCT’s population and then adjusted for a large variety of other factors, including the type of population; deprivation; mortality rates; and, controversially, the difference between previous allocation and formula results.

The formula leads to a marked difference in per capita allocation by PCT across the country. For example, in the current year the PCT with the lowest funding was Leicestershire with £1,330 per head, and the highest was Liverpool with £2,140 per head. This year, Milton Keynes PCT received £1,410 per head, the 12th lowest in the country. In other words, if Milton Keynes, with a crude population of approximately 240,000, had received average national capitation, it would have an extra £51 million more than the £349 million it actually received, and had it been funded at the average rate of a northern PCT, it would have received £74 million pounds more. Just to underline this point at a regional level, South Central strategic health authority received £5.8 billion for its 4.1 million people. Had it received a typical northern per capita allocation, it would have received an extra £1.2 billion.

Given those numbers, perhaps it is not surprising that the NHS in the south of England struggles to make ends meet.

[Caroline Flint (Don Valley) (Lab)]

What are deprivation levels like in the hon. Gentleman’s constituency? How much longer do people in his constituency live compared with men in Doncaster, Liverpool, Newcastle and other northern areas? We recognise that there are health inequalities and we have to fund the necessary measures to ensure equality in living as long as possible.

[Mark Lancaster]

The right hon. Lady makes a valid point. The whole point is that we have the health formula to take those factors into account, but despite that the last Government artificially adjusted the funding to upgrade certain PCTs. If she listens to my speech, she will understand what I am trying to say.

Northern SHAs have surpluses approximately three times the size of South Central. Yorkshire and Humberside enjoys a surplus of £49 per head. However, putting the inequality of this to one side, it means that the weaknesses of the current NHS structures are likely to appear first in the south rather than in the north of England. But given that the allocation formula attempts to fund broadly according to need, why have the funding formula at all if we are going to ignore it? The answer, in part, appears to lie in an extract from the Health Committee’s report, “Health Inequalities”, published in March 2009. Paragraph 96 says that

“not all areas currently receive what they should receive according to the resource allocation formula. This is because historically many areas have received less funding than they need, but rather than taking away large amounts of funding from some over-funded areas to compensate more needy areas, the Government has adopted a more gradual approach to shifting resources over a number of years, meaning that some PCTs are still receiving funding below their ‘target’ amounts.”

The development of the weighted capitation formula is continuously overseen by the independent Advisory Committee on Resource Allocation, or ACRA. Given the inequalities in funding that currently exist, I would like to suggest some minor changes of my own. First, the allocation formula should adequately address the costs of providing health care to the elderly, especially in areas with high life expectancy. Secondly, the allocation formula should adequately reflect the fact that the majority of an individual’s lifetime costs of health care are incurred in the last two years of life, whatever the age of death, and—crucially—regardless of the local level of deprivation. Finally, the key area in which the formula could be improved—I make no apologies for the fact that as a very diverse community Milton Keynes would benefit from this change—is by basing allocations on individuals’ health, rather than the blunt tool of populations being aggregated at the PCT level. However, I accept that the principal problem with that is getting sufficient data.

Process targets sometimes yield perverse incentives when coupled with the inappropriately named “payments by results” scheme, which actually seems to reward activity rather than results. I shall give just two brief examples. The first is the four-hour waiting time in accident and emergency. Say that after three hours 55 minutes a patient is waiting for a blood test result. The hospital will take them in as an in-patient—perhaps only for 10 minutes until the result arrives—so that it does not miss the target. That means that rather than being charged £70 for out-patient treatment, the PCT will be charged £700 for in-patient treatment. Is that really the best use of scarce financial resources?

Hospitals have no incentive to discharge people from out-patients as they are paid for activity. Indeed, in Milton Keynes, less than half of first out-patient appointments are the result of GP referrals. For example, lots of patients attending accident and emergency or the assessment unit will be given a hospital-initiated out-patient appointment rather than being discharged back to their GP. If a hospital can see a patient several times, generating a bill on each occasion, where is the incentive to organise care so that everything can be done at one visit if it can then only bill for that care once? I support limited targets, providing that they are based on clinical need and are not process driven—and do not lead, like the examples that I have just given, to scarce financial resources being squandered.

It is widely recognised that the NHS, in common with health care systems in every developed country, wastes possibly 20% or more of its resources on overuse, misuse and underuse of health care. Many feel that the current configuration of hospitals and community services in England does not readily allow clinicians to offer the highest quality of care at lowest unit costs.

There is an argument that the rigid demarcation between primary and secondary services and the role of the district general hospital needs to be allowed to evolve to meet the needs of the 21st century. That is particularly true where administrative boundaries and top-down planning have stifled local developments. For example, the Milton Keynes and south midlands growth area has a rapidly growing population. The growth area straddles three strategic health authorities and government regions. It has a population of nearly 2 million, but is served by several small hospitals close together, each of which is struggling both financially and to provide the quality and range of services that the population needs and expects. The challenge in and around Milton Keynes is to allow local communities and hospitals to think beyond and across artificial bureaucratic boundaries to find new ways of improving value for money and quality of care.

Taken together, if health services were held to account for the outcomes that they produce, rather than the numbers of patients treated, the services of the future, and particularly hospitals, might need to look very different from those of today. However, if we allow changes to be led by clinicians in consultation with the public—a bottom-up approach rather than the top-down approach advocated by the last Government—we can be confident that, most importantly, the services will be of a higher quality. I believe that the measures outlined in the Gracious Speech are a step in the right direction, and that we can achieve those aims.

In the final 20 seconds left to me, I simply want to wish all those about to give their maiden speeches the best of luck.

18:11

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

It is a great pleasure to speak about a matter of vital importance to my constituents young and old. A focus on education matters a great deal in Hackney, where we have a multinational community and education is highly prized. Hackney is a poor borough in many ways, but it is also aspirant, and there is no lack of poverty in the desire to get educated and improve one’s life. Education and skills training more widely, which I would like to touch on, are important to my constituents. They also help to tackle poverty and social exclusion.

Hackney’s record is a good one. We have four brand-new city academies, with a further city academy on the way, and we have seen massive improvements to other secondary and primary schools. Hackney’s record on educational attainment at 16 has massively improved. The results improved from 30% of pupils achieving five GCSEs at grades A* to C in 1997 to 70% doing so in 2009. In particular, we should thank Mossbourne city academy and its head teacher, Sir Michael Wilshaw, for last year having 83% of students achieving five GCSEs at A* to C, which is well above the national average, and this in a borough that in the past would not have been a byword for good education. There is still more to do, of course. Bridge, Petchey and City academies in Hackney, which are yet to have GCSE years, are all working to emulate the Mossbourne example. It would also be interesting to discuss with Ministers the establishment of a 14-to-18 academy in Hackney community college.

There is more to do. Around 48% of 16-year-olds still leave school without five GCSEs at A* to C. It is not the only measure of success, but it is an important one in any attempt to get young people into work and further education. We also need further improvement in our primary schools. Some good work has been done in the 12 new Sure Start centres in the constituency, which are of huge benefit to parents and under-fives across all social backgrounds. I am concerned at the suggestion that this Government plan to segregate support for the under-fives and focus only on those in greatest need. One of the strengths of Sure Start in Hackney is its comprehensive nature. I have a one-year-old, as well as other children, and I know that all parents, whatever their backgrounds, need the support.

Hackney’s approach has been pivotal to how things have worked. We have an elected mayor and a council in Hackney, which have taken a can-do approach to what the Government have to offer. Hackney’s focus across the board has been on practical results that change lives. We are not bound up in ideology; we want to ensure that what we do makes a difference. Mayor Pipe should be congratulated on his work, as should others on their work. We have taken what the Government have offered and made it work for Hackney, tailoring it to Hackney’s needs and interests. Whatever the Government propose, we will continue to put Hackney children first in our schools system.

I am concerned about the free school proposal—I would love to talk more about it, but I do not have much time. How will it fit in with proper planning in local authorities? Is it not a distraction? Is not the proposal a policy for the few and not the many?

I want to touch briefly on extended schools. Schools in Hackney are leading the way in that respect, with provision usually provided from 8 am to 6 pm, and in secondary schools for far longer, with breakfast clubs, after-school clubs and, often, ESOL-type teaching—the teaching of English for speakers of other languages—for adults, as well as wider adult education. Such initiatives help to tackle poverty and social exclusion where it really matters: in the family, helping those parents to help their children get better educated. In many communities, the young children coming to school at both primary and secondary levels often go home to a household not only where no English is spoken—it is fine for them to have that mother tongue—but where the parents themselves are not very literate in their mother tongue. Addressing that is an important aspect of what primary schools in Hackney provide.

At the secondary level, we want to give young people the opportunities provided by extended schools well into the evening and before school. Those clubs are supported not only by schools, but by organisations such as the excellent Magic Breakfast, which provides young children with breakfast in schools. It was discovered that in Hackney, as well as in other boroughs, many young people turn up to school without food in their stomachs because of their chaotic family backgrounds. That meant that they were achieving less well. Thanks to Magic Breakfast and others, we have seen attainment increase.

I want to know that the Government are still committed to extended schools, because they are vital to working parents. If we want child poverty to be tackled and attainment increased, we need to see that input in the family—those role models in place and that income coming in—which is something that any Secretary of State for Education needs to see in the round, and as something that goes hand in hand with welfare support. It is all very well asking people to go back to work, but without the child care in place, that is challenging, and in Hackney that matters a great deal.

In the time remaining I want to talk about skills and training. I do not have the time to go into all the figures, but Hackney has one of the highest unemployment rates in London. However, we are fortunate to have a good further and adult education sector, in the form of Hackney community college, BSix and the sixth forms emerging in new schools for 18-year-olds. In particular, Hackney community college, organisations such as Working Links and Lifeline, and the jobcentre provide support to workless adults, focusing on the skills and education that they need to get off the dole and into work, supporting themselves and their families.

With 34% of Hackney households speaking English as a second language and 16% of adults in Hackney having no qualifications, which is above the London average, we need to ensure that this issue is tackled. Significantly, however, the figure for adults with no qualifications has gone down, from 25% to 16% in just three years, thanks to work by the community college and others. Significantly—this is directly linked to the work of Hackney community college, which should be congratulated—the number of young people not in education or training is down, from more than 12% to 6.4%, again in three years. That is evidence to back the argument that the college should be supported in being allowed to become a city academy in media and health, within the environs of the wider adult education that it provides.

Hackney community college is soon to receive an Ofsted report, which I do not doubt will be good. Because of its excellent reputation and work, the college deserves to have the freedom to decide how the money that it receives from the Government is spent, because what works in Surrey Heath might not work in Hackney. We need that flexibility between Government budgets to allow local priority setting, in order to ensure that ESOL, basic skills, work with 16 to 18-year-olds, as well as those who are 19-plus, Train to Gain and apprenticeships are judged by their results, rather than by the name attached to the money that is given to them. If the Government are serious about giving freedom to education providers, I hope that they will consider giving freedom to further education colleges to make their own choices about what works locally and be judged by the results, rather than the tick-box approach based on where the money comes from. I hope that the Government will consider meeting me and the principal of Hackney community college, Ian Ashman, to discuss that freedom, as well as setting up a city academy within the environs of the community college.

18:18

[Robert Halfon (Harlow) (Con)]

Given that it has taken me 10 years and three elections to reach this place, I feel a real privilege and a sense of service in giving my maiden speech. Although I am the first Halfon to serve as a Member of Parliament, I am not the first to have a role in British politics. I understand that my ancestor Isaac Halfon, who was an expert on divorce legalities, was called on by King Henry VIII to discover the status of Judaic law regarding the King’s proposed divorce from Catherine of Aragon. Fortunately for me, I am told that he gave the right answer. I am reminded of the quotation of the civil war poet, Robert Herrick, who said:

“Know when to speake; for many times it brings

Danger to give the best advice to kings.”

I hope I will remember that as I begin my career in this Chamber.

Harlow is a unique place, and a varied constituency. In less than 10 minutes, one can travel from new town to leafy village. It is thought that one of the first slaves to be buried in England, who was known as Hester, was laid to rest in 1767 in St Mary’s church at Little Parndon. I am glad to say that the MPs who lived in west Essex at the time were contemporaries of William Wilberforce, and that they fought alongside him for the abolition of slavery.

Harlow has a long tradition of helping the most vulnerable, and of being a thriving community and a place where social justice is at the forefront of the minds of its political representatives. Winston Churchill represented Harlow between 1924 and 1945, when it came under the Epping constituency. In 1923, in a speech in Victoria Hall in Old Harlow, he urged the restoration of the penny post and of pensions for widows with children. Similarly, although I had many policy differences with my predecessor, Bill Rammell, there was never any doubt about his absolute passion for Harlow, or about his determination to improve the lives of those most in need.

Harlow new town was built primarily to provide decent homes and living space for those living in poor quality housing in east London. It has many beautiful places, most notably Parndon Mill, which is perhaps the most romantic spot in Essex. The town park, Harlow common, the green wedges and our picturesque villages of Hastingwood, Matching Tye, Roydon, Nazeing and Sheering are a testament to the green nature of my constituency, and I will always fight hard to preserve this.

Like so many residents of Harlow, I am delighted that the Government have said no to an extra runway at Stansted, with all the environmental damage that that would have wrought. Nevertheless, despite our many beautiful areas and original architecture, parts of Harlow are creaking with age. There is a great feeling of optimism about the regeneration of the town, however, thanks to the work of Harlow Renaissance, local councillors and the former MP. Some regeneration has already been completed, including a new leisure zone, which is soon to be opened, and the revamped water gardens. Anglia Ruskin university—which my partner, Vanda, attends as a mature student—is due to open a campus in Harlow next year. The regeneration will strengthen Harlow’s rightful place in the pantheon of great new towns.

For the regeneration of Harlow to succeed, however, there are certain things that the town desperately needs. One of the most important is an extra bypass to the M11. Inexplicably, Harlow was built with just one entrance, with most of the industrial quarter being at the opposite end. As a result, traffic in Harlow has reached gridlock, with large lorries trundling along from one end of the town to another. If Harlow is to have a viable future, a bypass is not a luxury but a necessity.

I mentioned a moment ago that one of the best tributes to my constituency is its strong community. I am a community Conservative, so I will always act to support and strengthen community organisations, even when financial resources are not readily available. To me, communities are the bedrock of our stability and are fundamental to our well-being, but there remain significant problems that we have to confront, rather than sweep under the carpet. One in eight adults in Harlow have literacy problems, and one in five have difficulties with numeracy. There is also a skills deficit. In Essex, nearly 4,000 young people are not in employment, education or training, and Harlow is one of the worst-affected towns.

I have come to the conclusion that education and skills are the real answer to these problems, but we must also transform the nature of vocational training and apprenticeships in our country. If we give young people the necessary skills and training, we give them opportunities and jobs for the future. Expanding and improving apprenticeships is not just about economic efficiency based on pure utilitarianism; it involves the profoundly Conservative ideas of helping people to help themselves, of a work ethic, of opportunity and, most importantly, of social justice.

I have seen for myself the power of apprenticeships to transform lives. I have seen John Tennison, the managing director of Smiths aircraft industries in Harlow, who started as an apprentice there more than 30 years ago. I have seen the construction training partnership, which helps youngsters supported by youth offending teams to train in building, electrical work and plumbing, and gives them the chance to succeed. I have seen Harlow college, and was delighted to visit the Essex apprentices scheme there with my right hon. Friend the Member for Chingford and Woodford Green (Mr Duncan Smith). It is no accident that our college is climbing so high up the league tables, with its aim to be one of the best in England.

Our policy of creating 100,000 extra apprenticeships every year is something to be proud of, but we must do more, particularly in regard to reducing red tape and regulation and giving better incentives to businesses. Above all, we need a root-and-branch cultural change in our country. Winning an apprenticeship should be as highly regarded as getting to Cambridge university—or any university, for that matter. Apprenticeships should be held in the same regard as higher education by secondary school teachers, yet all the evidence shows that the opposite is the case. The apprenticeship organisation Edge says that two thirds of teachers regard their knowledge of apprenticeships as poor, and that just one in four teachers believe that apprenticeships are a good alternative to A-levels. As an MP, I intend to play my part in changing the way we regard apprentices.

I began my speech with the story of a monarch, and I hope that you will forgive me for ending it with another. Queen Elizabeth I was a great fan of Harlow, having visited it on a number of occasions. It is well known that her chief adviser, Lord Burleigh, suffered from the most tremendous gout. He expressed his concern about his service to his Queen, to which the monarch replied:

“My Lord, we make use of you, not for your bad legs, but for your good head.”

Mr Deputy Speaker, I have good news for you and this Chamber. I do not suffer from gout, but I do have the heart and stomach to fight hard in this House for Harlow and for our country.

18:27

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

I congratulate the hon. Member for Harlow (Robert Halfon) on an excellent maiden speech. We look forward to his future contributions. I should also like to echo his tribute to his predecessor, Bill Rammell, who was popular on both sides of the House.

Today I am making my second maiden speech—the first was 13 years ago—and I am doing so in the hope that I shall not have to deliver a third at any point in the future. My predecessor, Bob Wareing, entered the House in 1983. Bob was one of the first MPs to propose private Members’ legislation to tackle discrimination against disabled people. I know he was respected on both sides of the House as a decent, courteous parliamentarian who believed passionately in the causes for which he spoke up. In his maiden speech in 1983, he spoke out against the threatened closure of Croxteth comprehensive school. The school was saved in the 1980s but, sadly, it is due to close next month, despite massive local opposition. I will work with local parents, with Liverpool city council and with the Government to explore options to restore a mixed, non-faith school for 11-year-olds in Croxteth and Norris Green.

Almost 1,000 years ago, West Derby featured in the Domesday Book. Today’s parliamentary constituency includes Dovecot, Tuebrook, Croxteth, Norris Green, Knotty Ash and West Derby itself. Perhaps my most famous constituent resides in Knotty Ash. He is the comedian Ken Dodd who is now 82 years old and still going strong—[Interruption.] I shall make no comment on his politics. West Derby village has the only free-standing post-mediaeval courthouse in the country. It was built in 1586 and restored in 2005.

Crime and policing are key challenges in the communities that I represent. The appalling murder of young Rhys Jones in 2007 shocked the entire country and united the people of Liverpool not only in revulsion but in a determination that no more young lives should be lost. Rhys’s parents have shown great dignity and courage throughout their terrible ordeal.

West Derby has a vibrant community and voluntary sector, in which the “big society” is already a reality. The sector involves groups such as Kinship Carers, which supports grandparents with caring responsibilities; Chrysalis, which provides a voice for families living with the horror of domestic violence; and the Communiversity, which provides jobs, training and apprenticeships for hundreds of local people. Then there are active citizens, such as Lee and Stephen Dunne, whose son Gary was murdered in Spain—they had to fight to have his body returned home and are now setting up a charity in his name to tackle the scourge of knife crime.

Perhaps the best known facility in the constituency is the truly wonderful Alder Hey hospital, which was founded in 1914. It was originally conceived as a workhouse for infirm paupers. Today it is an excellent hospital, caring for 250,000 children every year. Its plans for redevelopment will create the first ever children’s health park in the UK—replacing buildings, most of which are 100 years old, with some having been built to the design of Florence Nightingale. The plan is for a hospital set in a park that will be the most environmentally sustainable hospital in the country. I know that the new Secretary of State for Health visited Alder Hey earlier this year and was very impressed by what he saw. I hope he will be able to take the opportunity when he closes today’s debate to reaffirm the Government’s support for Alder Hey, so that the children’s health park can open in time for the Alder Hey centenary in October 2014. I also urge the Secretary of State to give the go-ahead for the Royal Liverpool hospital scheme, which is so vital for the future health of the people of Liverpool.

I want to focus on education in the time remaining. Last week, at the beginning of the debate on the Loyal Address, the Prime Minister characterised Labour’s approach to public services as simply a combination of extra spending and Whitehall diktat. Well, yes, we did increase spending, and we make no apology for having done so. The fruits of our investment can be seen in all our constituencies—in the children’s centres, in the new and refurbished schools, in better paid teachers and in a new work force of teaching assistants in our schools—but it was never just about money. It was about innovation and improvement in our schools, and the sharing of best practice across the system. It was about the literacy strategy, Teach First, the National College for Leadership of Schools and Children’s Services, school federations, academies and trust schools. All these reforms were designed to improve the quality of education, and most notable of all was Sure Start—perhaps the most significant innovation in social policy in this country in the past half century.

Those are real achievements of which Labour Members can be proud, but we also need an honest debate about where we made mistakes during our period in government. We did allow the target culture in public services to go too far. Many professionals felt that their voices were not being heard by the Government, and we sometimes focused too much on structures and not enough on content. On that point, I fear that the new Government might well be in danger of making exactly the same mistake. At the heart of good public services are good relationships. The best schools combine effective leadership at all levels with an absolute focus on the quality of learning and teaching.

As we consider the Government’s school reforms in more detail, I suggest three tests against which we should judge them: will they support improved teaching and learning; will they encourage better leadership at all levels; and will they promote fairness both in admissions and in school funding? I welcome increased flexibility and freedoms for schools, but we should support co-operation between schools and a continued role for local authorities to guarantee fairness at the local level.

I want to finish by talking about Building Schools for the Future because BSF is about promoting both fairness and excellence in education; it is not just about new buildings. A deliberate choice was made by the Labour Government to focus first on the poorest parts of the country. I am proud that Cardinal Heenan, Broughton Hall and West Derby schools in my constituency are currently being rebuilt—£67 million being well spent, but there are five more schools waiting to find out whether the Government will decide to go ahead. I urge the Government to go ahead with these important programmes. I want an 11-year-old in my Liverpool constituency to have the same opportunities that a child going to a top private school can take for granted. That was the vision behind Building Schools for the Future. If we are serious in this House about social justice, it is a vision that we should reaffirm today.

18:35

[Duncan Hames (Chippenham) (LD)]

Thank you, Mr. Deputy Speaker, for giving me the opportunity to make my maiden speech so early in this Parliament. I congratulate the hon. Members for Harlow (Robert Halfon) and for Liverpool, West Derby (Stephen Twigg) on their thoughtful and compassionate speeches. They are indeed a hard act to follow.

One of my predecessors as Member of Parliament for Chippenham, albeit almost 200 years ago, was Sir Robert Peel. His maiden speech was to second the reply to the King’s Speech and it was described by the then Speaker as

“the best first speech since that of William Pitt”.

It lasted 40 minutes and Members will be pleased to hear that I cannot hope to emulate him—in that respect, at least.

Although Chippenham first returned Members in 1295, it is one of this Parliament’s new constituencies, formed from parts of North Wiltshire, Devizes and Westbury, all of which were represented by Conservatives. My hon. Friends will therefore find me in the unfamiliar position of saying kind words about not one, but four, Conservative MPs—I could certainly use the practice! I say four because Sir Richard Needham was the most recent Member to represent a constituency going by the name of Chippenham. Sir Richard was the longest-serving British Government Northern Ireland Minister and also a successful Minister of Trade. He continues to work in business and I had the pleasure of meeting him on the very day that the election was called, as I visited a company in my constituency of which he is chairman. The significance of the visit was not lost on the local and regional media, who reported it widely, and I am grateful to him for his enthusiastic welcome.

Sir Richard was succeeded by my honourable neighbour, the current hon. Member for North Wiltshire (Mr Gray). We were both involved in the campaign to save Chippenham hospital, which, like the minor injuries unit that closed in Melksham, had been frustrated by a lack of support from Wiltshire county council when it really mattered. My honourable neighbour secured an Adjournment debate on the issue on 18 March 2008. I came to the Gallery that evening to lend my support and to see him put the then Minister on the spot. Now that we sit on the same side of this House, I look forward to finding common cause with him more often.

Members will know that my honourable neighbour, the hon. Member for South West Wiltshire (Dr Murrison), formerly Westbury, is a doctor. He served for 18 years as a medical officer in the Royal Navy, leaving as a surgeon commander and continues to serve as an officer in the Royal Naval Reserve. This saw him recalled in 2003 to serve in Iraq, and he has used that experience to speak eloquently about defence matters while in opposition. He reminds us of the professionalism of our armed forces, both regular and reservist.

Finally, the Devizes constituency has also contributed to the Chippenham seat. My predecessor there was Michael Ancram, who served three constituencies during his time in this House, as well as serving his party as chairman and deputy leader. I commend his last speech in this place, which was during the debate on the Budget statement. He was concerned that this generation’s legacy to the next would be worse than financial debt, which can, after all, be repaid, as we risk leaving as our legacy a permanently damaged environment. He quoted a native American saying, which has long been a favourite of mine:

“We do not inherit the earth from our ancestors; we borrow it from our children.”

He urged this new Government to recognise and address the coming environmental challenges, the greatest of which is surely man-made climate change. Accepting this mission—one that has also been put to me by the Bradford-on-Avon climate friends— will be a focus of my activities throughout this Parliament.

Chippenham has not been represented by a Liberal since Alfred Bonwick more than 80 years ago. I am also the first Liberal Democrat Member to serve in this House for Wiltshire. Chippenham has experienced substantial growth in recent years, so I am pleased that the coalition Government have resolved to scrap the housing targets in the regional spatial strategy, which would otherwise have seen Chippenham grow by about a quarter over the next 15 years, threatening open land near to Birds Marsh woods and along Chippenham’s flood plains.

Although not included in its name, my beautiful and diverse constituency also includes the towns of Melksham, Corsham and Bradford-on-Avon, as well as villages such as Holt where I live, Hilperton, Winsley, and the National Trust village of Lacock—and, indeed, the southern tip of the Cotswold area of outstanding natural beauty at Limpley Stoke. In fact, my constituency will be familiar to fans of costume drama, as Lacock has starred in adaptations of “Pride and Prejudice” and “Emma” among others, and is better known to many as Cranford.

The railways have long been vital to the constituency’s economic development, yet Melksham, which is the county’s fifth largest town, has only two trains a day in each direction. Some Members may pass through Corsham, after Brunel’s impressive box tunnel, when travelling by rail to Parliament. The town certainly sees many trains each day, but none of them stops there for the people of Corsham to use. Through my work here, I will continue to campaign for the improved rail services that my constituents so badly need.

I hope to open a constituency office in Chippenham town centre, which, if successful, will make a modest contribution to the town’s services. However, I shall not be able to match Joseph Neeld, who paid for a new town hall to be built on the high street. It still bears his name, although—or perhaps because—his energies were so focused on the town that, in the 24 years that he spent as Member of Parliament for Chippenham, he did not speak once in Parliament. It seems clear already that I have not managed to show such self-restraint.

As a Wiltshire school governor for the past eight years, I was particularly keen to make my first speech during a debate on education. Great teachers, excellent schools and a world-class university all helped to give me the confidence, financial security and independence to embark on the journey that has brought me here today.

Despite my father’s best efforts, both my parents attended secondary moderns, and, in his case, a technical college. I recall my mother telling me while I studied for GCSEs that she had left school by the time she was that age. Nevertheless, as loving parents, they well understood the difference that embracing learning could make to the opportunities that lay ahead for all of us, and I was the first in my family to go to university—something that we could only afford with the help of a grant.

I was very fortunate. As my right hon. Friend the Deputy Prime Minister pointed out repeatedly during the recent election, family wealth still makes a massive difference to the educational outcomes achieved by children today. I agree with Nick. There are some excellent schools serving communities in less well-off areas, but it simply is not good enough for so many families to find that accessing a good education for their children is dependent on their faith, on paying fees, or on being able to afford a home in an expensive catchment area. Every school should be a good school.

The pupil premium that our Government will now introduce is a crucial lever for directing funds into schools serving families who cannot buy their way to a more successful school elsewhere, so that we can be sure that all children receive the support and attention that they need. I believe that this Government will become known for their ambitious school reforms, the measure of success for which will be that a great education is within reach of every child, whatever their background and whatever their family’s means.

Whether in education, the economy or the environment, looking ahead with a concern for the next generation will, I hope, be the hallmark of my contribution to this place—a contribution to which I will devote the very best of my ability.

18:43

[Gavin Shuker (Luton South) (Lab/Co-op)]

Mr. Deputy Speaker, I thank you for calling me in this important debate on the Gracious Speech, and congratulate the hon. Member for Chippenham (Duncan Hames) on his maiden speech. I am sure you agree that every maiden speech makes the last constituency flit away as we hear of the honours and excitement of the new constituency.

It is an honour and a privilege to speak in this Chamber. Indeed, it is something that very few people in each generation are able to experience. A year ago, I did not anticipate that this would be part of my life—certainly not at such a young age—but the voters of Luton South have bestowed on me this position of service, and I will for ever owe them a debt of thanks.

To me, Luton South is not just a seat; it is my home. I was born in the town, receiving the schooling that saw me into Girton college, Cambridge. I was fortunate enough to receive a bursary to study there, and my student fees were covered by the public purse. Those investments in me are, I hope, being repaid in my desire to serve our society. I worked for a local church, and I joined the Labour party. I have always been inspired by the people who choose to serve a place, to commit themselves to it, and to see it change in terms of individual lives and on a regional level. That is the model that I have sought to replicate.

Luton South is a wonderful constituency, and I can honestly say that I would not want to represent any other seat. As well as containing Luton airport, two mainline railway stations, a carnival arts centre, Luton Hoo, the General Motors plant in which my father worked, Stockwood park, many improving schools, and the villages of Caddington, Hyde and Slip End, Luton South is home to a rich and diverse range of communities. Indeed, it has been remarked to me that should it choose to declare itself an independent state, we should have all that we need. Now that my hon. Friend the Member for Luton North (Kelvin Hopkins) and I are the only two Opposition MPs in the east of England, perhaps that is not such a bad idea.

I love our town, and it fills me with enormous pride that her residents chose one of their own to represent us in Parliament. In her maiden speech, my predecessor Margaret Moran spoke about a pupil of Dallow primary school. In 1997, that pupil was in a class of 37, facing educational challenges that few would recognise today. Our Labour Government faced up to the reality of that time, and moved to act and invest in education.

Margaret Moran served the people of Luton South for 13 years in a position that carries its own unique pressures, and she deserves recognition as someone who, as part of that significant intake of 1997 Labour Members, transformed fundamentally the terms of debate not just in relation to politics, but in relation to education in particular. The legacy of those Members can be seen in the educational achievement of every child who no longer has to sit in an overwhelmed class or a crumbling building. The House has lost many from that landslide year, and we owe them a debt of gratitude.

I have always believed that education cannot simply be reduced to the economic transaction of knowledge and skills in return for time and money. Education is about the investment that we make in each of our young people. Education is about the kind of society that we seek to create. I should like to think that my own comprehensive education provided me not just with knowledge but with values—the values of a mixed society, and of a shared experience beyond income, race or religion.

While the debate of the coming years will inevitably focus on greater diversity of provision, we must ensure that the vast majority who receive a comprehensive education are not left behind. Education remains the most effective and, indeed, the most intuitive route to ensuring social mobility. We recognise it in developing countries all over the world as the silver bullet—the means of tackling both poverty and inequality—and we should recognise it here as well.

The excellent university of Bedfordshire also has its home in Luton South. In the coming Parliament, we will examine the issue of student funding in greater detail; and here the economic argument continues to hold sway. It is often true that graduates earn more, but it may not automatically be true that as a result they should pay more, at the cost of student fees which, despite all the safeguards, can still deter those from disadvantaged backgrounds. When we educate someone, be it as a teacher, a doctor or even, dare I say, a social science graduate, we all benefit. That must be an important part of this debate.

Finally, let me speak in the context of the times in which we find ourselves. It has become fashionable to say that markets must have morals, but it is also worth articulating that there are limits to markets altogether. In natural monopolies such as rail, in the provision of education, where they can serve to ration provision, and in other areas in which co-operative ideals best express their form, we are forced to examine the prevailing orthodoxies and expose their weaknesses.

My Christian faith confirms in me the conviction that we are fundamentally designed to operate in co-operation and not merely in competition; that not just some but all have inherent worth and value; that tackling inequality is not merely a political concern, but a moral one; and, also, that there is more to life than politics. I am young, but I am not naive. I am sure that I will humbly need to reacquaint myself with those convictions in the years ahead.

18:49

[Dr Sarah Wollaston (Totnes) (Con)]

Thank you, Mr. Deputy Speaker, for letting me catch your eye when so many hon. Members wish to do the same.

I thank the hon. Members for Chippenham (Duncan Hames) and for Luton South (Gavin Shuker) for their passionate speeches about education. I come to the House with little political experience, but as a doctor and teacher selected through an open primary, the first in the country to give every voter in a constituency the chance to select their candidate. I would also like to thank my predecessor, Anthony Steen. He served this House for an extraordinary 36 years. He is not the sort to retire, and I wish him well in his continuing fight against the evils of human trafficking.

I am very fortunate to represent one of the most spectacular and diverse constituencies in this country. The Totnes constituency stretches from the hill farms of Dartmoor to the most stunning of west country coastlines, which supports a diverse tourist and fishing industry. Many people may not realise this, but more fish are landed at Brixham than at any other port in England—and I hope all Members will join me in recognising the adverse effect of the common fisheries policy on our fishing industry.

[Mr Peter Bone (Wellingborough) (Con)]

Hear, hear; very well said.

[Dr Wollaston]

Thank you.

We are also home to “Transition Town Totnes”, which is the home of the transition towns movement. As such, it recognises not only the problem of climate change, but problem of the peak oil; it is planning ahead for a time when we no longer have abundant or cheap fossil fuels.

In the South Hams, we also have some of the most spectacular countryside, but I have to inform Members that that countryside is in crisis. We are fast losing our sustainability as more and more dairy farms in particular go out of business because of the problems of bovine tuberculosis. Devon is, in fact, at the very heart of the bovine TB epidemic. As a doctor, I have to tell Members that we cannot treat infected badgers by vaccination. Vaccination can only hope to prevent the disease in unaffected individuals. I have been teaching junior doctors evidence-based medicine for 11 years, and I can say that one of the problems we face is that the randomised badger culling trial has for years wrongly been used to justify a policy of inaction. Unless we do something about bovine TB, more and more of our farmers will go out of business. We need to recognise the effect on them and their families, and the very real distress bovine TB causes them.

The main reason why I came to this House is because I feel passionately about our NHS and the patients it treats. I welcome the proposals in the Gracious Speech to get rid of top-down bureaucracy in the NHS and to hand power back to clinicians on the front line.

In my constituency, we have four community hospitals, and I would like to pay tribute to their staff, and also their volunteers, for the work that they do. I hope that giving patients a louder voice in our NHS will prove to be the best protection for community hospitals, because people, particularly those in rural constituencies, really value them. I hope Members will support me in this endeavour.

There is another issue I wish to highlight, which affects not only my constituents, but those of all Members. After the tragedy of the Paddington rail disaster in which 31 people lost their lives, we rightly held a public inquiry and that led to the setting up of the Rail Safety and Standards Board, and after 3,000 terrible deaths in the USA, we joined a “Global War on Terror”, so what should we say should happen after 15,000 to 20,000 deaths every year in this country as a result of alcohol? I pay tribute to the right hon. Member for Rother Valley (Mr Barron), who has chaired the Select Committee on Health. It has recommended minimum-price alcohol as the best way forward. That may not be popular—in fact, in suggesting that we cull diseased badgers and raise the price of alcohol, it is clear that I am going for the popular vote! However, unless we do something about this, our constituents will continue to suffer. Let us look at the statistics: 1.3 million children in this country are directly affected by alcohol, and alcohol is a factor in half of all homicides. Members also need only consider the number of constituents they see in their surgeries who are victims of domestic violence. Alcohol continues to be the number one date-rape drug in this country, too. I ask all Members to look at the evidence, so we can have evidence-based politics.

The evidence is out there, and it is very clear. If we want to do something about the death toll—15,000 to 20,000 people a year in this country—we have to do something about price and availability. This is not about the nanny state; lives are at stake, and I ask the House to look again at the evidence, not only from the National Institute for Health and Clinical Excellence report issued today, but from its own Select Committee. I commend minimum-price alcohol to the House.

There is no such thing as cheap alcohol; we are all paying a very heavy price.

18:55

[Emma Reynolds (Wolverhampton North East) (Lab)]

I congratulate the hon. Member for Totnes (Dr Wollaston) on making such an excellent maiden speech, and I also congratulate all the other new Members who have made their maiden speeches today. I thank you, too, Mr. Deputy Speaker, for giving me this opportunity to make my maiden speech as the new Member for Wolverhampton North East. It is a privilege and an honour to represent my home town in Parliament.

My predecessor, Ken Purchase, is a giant of a man. Apart from being tall and broad, his booming voice was the envy of many in this House, and many on the Government Benches will remember him well. Ken’s lifetime of public service extends over some 40 years: he served for more than 20 years as a local councillor and for 18 years as a Labour MP. His commitment to the constituency was exemplary, in particular his fight for greater equality and fairness. As a tireless campaigner for improved social housing, he touched the lives of thousands of his constituents.

I would also like to pay tribute to the powerful women who have preceded me in Wolverhampton: the journalist and activist, Renée Short, who represented the constituency for more than two decades until her retirement in 1987; and Jennie Lee, who in her second stint in the House of Commons straight after the war, represented the constituency of Cannock, which then stretched south to cover Wednesfield and which now forms a large part of my constituency. Jennie was a firebrand socialist and a passionate defender of the poorest in society. She blazed a trail that many other women would follow—and I, too, hope to follow that trail. Always outspoken on issues that mattered to her, in her maiden speech in 1929 she defied the convention of avoiding controversy and launched a stinging attack on the Government. Never one to pull her punches, she described their Budget as

“a mixture of cant, corruption and incompetence.”—[Official Report, 25 April 1929; Vol. 227, c. 1117.]

Years later, she was appointed Arts Minister by Harold Wilson and her lasting legacy was the establishment of the Open university, securing a revolution in education. That was a huge achievement, as relevant and important today as it was back then. Jennie’s belief in expanding educational opportunities is one that I share and am passionate about.

Wolverhampton has a long and rich history. While Jennie Lee was the youngest parliamentarian of her time—in fact, she was too young to vote—the Liberal Member, Charles Villiers, was the longest serving MP in parliamentary history; and while Villiers opposed the corn laws in the 19th century, Sir Geoffrey Mander was one of the first MPs to take a strong stand against appeasement a century later.

Wolverhampton has been first in many other areas, too, and I am proud of its achievements. In 1866, Queen Victoria made her first public appearance after her husband’s death when she unveiled a statue of Prince Albert in the centre of Wolverhampton to honour his memory. Still standing today, the statue is a busy meeting point and affectionately referred to locally as “the man on the horse”.

Not far from there is our fantastic football stadium, the Molineux, which is home to our great football team, Wolverhampton Wanderers. Wolves were the first English team to play in the Soviet Union and were hailed by the press at the time as “the unofficial world champions” after one of their most famous victories, against Budapest. This year, as a proud Wolves fan I am happy to be able to say that we are still in the premier league at the end of a tough season.

Wolverhampton also boasts the headquarters of the UK’s most successful regional newspaper, the Express & Star, which has a circulation of more than 130,000 a night, six nights a week. Never shy of embracing new technology, the Express & Star blazed a trail when it was the first daily newspaper to publish colour photographs.

Since its foundation in 985, Wolverhampton has always been a place of trade and commerce, starting as a market town famous for its mediaeval wool trade and developing into the beating heart of the industrial revolution. Household names such as Sunbeam cars, Chubb locks, Boulton Paul aircraft and Norton motorbikes were famous worldwide and symbolised British manufacturing at its very best. Manufacturing continues to play a crucial role in the city’s economy; it is more important to Wolverhampton North East than to the west midlands region as a whole, with 18% of its work force employed in manufacturing jobs compared with the regional average of 13%. Leading aerospace companies, such as Goodrich, HS Marston and Moog, as well as companies such as Goodyear, Carillion and Banks’s brewery, are all major local employers.

Of course, our service sector has also developed strongly and the largest private employer is the headquarters of Birmingham Midshires. However, the recent recession has demonstrated clearly the dangers of relying too heavily on financial services. The UK remains the sixth largest manufacturing nation in the world, and we need to build on our expertise and take full advantage of the low-carbon revolution to secure a strong and sustainable economy in the wake of the global financial crisis.

We must look to the future as well as learn from the past, and I am optimistic about Wolverhampton’s future. During my election campaign, I promised to champion local jobs and industry, and I am already working with local businesses and Advantage West Midlands to ensure that projects such as the new i54 business park are a success. On that point, I am deeply concerned about the new Government’s planned cuts to regional development agencies, including Advantage West Midlands, which brings a return of more than £7 to the regional economy for every pound spent. This Government’s plans to cut its budget dramatically will put local businesses and jobs at risk, and I urge the Government to think again.

Public services are central to a strong economy and a strong society. I am proud of the previous Labour Government’s achievements in health and education. New Cross hospital is at the heart of my constituency, and the previous Government’s investment has resulted in a massive increase in the number of front-line staff, lower waiting times and a state-of-the-art heart and lung centre. Educational standards have also risen, and the university of Wolverhampton is the sixth largest in the country and has a proud record of tackling social exclusion.

My journey to stand here today as the newly elected MP for Wolverhampton North East has been a very personal one. I grew up in Wolverhampton and memories of my formative years lie in our great city. It has long been my home and it has given me the opportunities that I have taken. I now hope to give something back to the good people of Wolverhampton, who are our city’s biggest asset. They are friendly, hard-working and fair-minded, and I promise to fight their corner to the very best of my abilities in Parliament, championing local industry and speaking up for greater equality and fairness.

19:03

[Charlotte Leslie (Bristol North West) (Con)]

Thank you, Mr Deputy Speaker, for allowing me to make my maiden speech. I shall keep it short, given that there are so many maidens-in-waiting. I cannot let this opportunity pass without congratulating all the new Members, including my new hon. Friend the Member for Chippenham (Duncan Hames), who is just leaving the Chamber, and my hon. Friend the Member for Totnes (Dr Wollaston). My father works in the NHS, so I am delighted that we have her kind of expertise on these Benches, because it is of great benefit to the whole House.

I stand here as a newcomer to the House who is slightly intimidated by the formalities—I beg your indulgence, Mr Deputy Speaker, should I mess up any of these formalities while making this speech—and sometimes the Chamber can seem a very long way from the streets of my constituency, where I have spent the past three years campaigning. My predecessors in Bristol North West have campaigned to ensure that this place is not a distant Chamber, removed from places such as the streets of Bristol North West, but is a Chamber that serves the people of Bristol North West and, indeed, of the entire country. On that note, I should like to pay tribute to my direct predecessor, Dr Doug Naysmith, who will be known to many hon. Members and who brought a tremendous amount of expertise, wisdom and integrity to the House. I am not following formalities when I say that he will be a very hard act to follow.

I should like to focus the majority of my remarks on education, which is the subject of today’s debate. Bristol North West is a fantastic and incredibly diverse constituency. It contains areas ranging from the fantastically successful Bristol port, which is undergoing expansion, to the rolling downs in Stoke Bishop. That diversity also means that Bristol North West is a tale of two cities, whereby extreme poverty and deprivation exist side by side with some of the richest wards in the country. Nowhere is that inequality seen more starkly than in education, because in my constituency some of the best-performing schools in the country can be found just hundreds of metres away from some of the most challenged schools in the country, and I am privileged to be able to address the Chamber today on education and to discuss some of the measures in the Gracious Speech.

Breaking down the terrible and invisible barriers that divide the haves from the have-nots will not be easy, but I am delighted that one thing on which the coalition rests is the pupil premium. Quite a long time ago, back in 2005, I was lucky enough to work with my hon. Friend the Member for Grantham and Stamford (Nick Boles) and James O’Shaughnessy on the pupil premium, and little did we know then that it would be a raft for such a friendly and successful coalition. The financial incentive directed to those most in need is just the beginning of eradicating the educational inequality that exists in my community and it will help schools such as Henbury school, Orchard school and the Oasis academy Brightstowe.

However, we all know that it is not only money and direct investment that can make a difference to tackling inequality—and thank goodness, because there is not a lot of it around. Human resources are also massively important. I am therefore incredibly excited about and welcome the measures contained in the Gracious Speech to expand organisations such as Teach First. I tugged the elbows of those in Teach First a couple of years ago, begging them to come to Bristol. They did not say no, but they did not say yes. Given the legislation that we will be considering, I hope that they will be able to come to Bristol North West, as Teach First will make a tangible difference to the lives of the children there. Such measures, which often start out merely as ideas in a report that are then taken to this place, can sometimes seem dislocated from those whom they are supposed to serve. The world outside this Chamber can seem very distant when one has been sitting down inside it for five hours, but it is there. I very much look forward to seeing these ideas make a tangible difference.

I shall cite one example in that regard. St Ursula’s school is a private school in my constituency, but it wants to open its doors to take state pupils. It exists in an area of burning parental need and desire for a new school. Parents have asked for this new school, but all along the line the authority has said no—the computer has said no. I shall be delighted if the legislation set out in the Gracious Speech means that parents who want a new school find that the computer can say yes and that the authority can help them to realise their ambitions for their children, giving children from all backgrounds access to new, good schools—to schools that only the well-off can afford at the moment.

In conclusion, I thank you, Mr Deputy Speaker, for indulging me. It has been an honour to address this debate on the single most effective way of closing that gap between the haves and the have-nots, which remains so stark in my constituency. I am talking about education, and I look forward to working within this Chamber, with my honourable colleagues and friends, to ensure that Bristol North West is a tale not of two cities, but of one city. I want it to be a place of opportunity for all, and that is also what I want this country to become.

19:08

[Hywel Williams (Arfon) (PC)]

I congratulate the hon. Members for Wolverhampton North East (Emma Reynolds) and for Bristol North West (Charlotte Leslie) on their maiden speeches, both of which promised much for the future. I well remember my own maiden speech. It was supposed to have been non-controversial, so I chose the entirely non-controversial subject of holiday homes in Wales!

In this new Parliament, Plaid Cymru and Scottish National party Members will be vigorous participants in the business of the House. I am glad to say that the new Green MP, the hon. Member for Brighton, Pavilion (Caroline Lucas), has joined us on this Bench, because she, too, has much to contribute. I would have been glad to hear contributions from our erstwhile colleagues, the former independent Members Dai Davies and Richard Taylor, both of whom worked very hard, and I pay tribute to their work while in the Chamber. Richard Taylor is a consultant physician, and I remember him saying in his maiden speech, “Since I joined the NHS, there have been 28 reorganisations. I rather liked the 19th.” That is a cautionary word for the Government and their aim of reorganising the health service in England.

Much education and health legislation is not directly relevant to Wales. However, there is a great deal to be said about education and health in Wales, not least the First Minister’s incomprehensible decision last week to sabotage Welsh medium education in Cardiff West. No doubt the Welsh electorate will make their view clear on that next spring—but I shall not stray into devolved matters in this speech. Health is largely a devolved matter, although some important matters are not. Early in my career here, I tackled the then Secretary of State for Health, Alan Milburn, over nurses’ pay. His erroneous response was, “It is an abiding joy to me that I have no responsibility for things Welsh.” He was actually wrong, and I hope that this Government and their Ministers are better informed and will show at least a modicum of better grace in dealing with all matters Welsh.

The question from Wales is, what is the significance of the Queen’s Speech for education and health? The Academies Bill will apply to England only. I was interested to hear the Secretary of State refer repeatedly to “this country”, whereas, of course, he should have referred to “England”. He should be aware that there are other parts of the United Kingdom that will not go down the route of academies or any of the other measures for education in England that he has outlined. The education and children’s Bill and the health Bill will have some provisions that apply to Wales, but it is not particularly clear which ones.

The main effect in Wales of the Queen’s Speech will of course come from cuts. We know already that the Government are postponing looking at the Barnett formula, even though successive independent reports have shown clearly that Wales is underfunded. The last report, the Holtham report, showed that Wales is already underfunded to the tune of £400 million. Added to that are the cuts already announced for Wales as part of the first £6 billion tranche and the much bigger cuts that we are facing in the future. Clearly, public services in Wales are in great danger. That is even more pressing because the easy—or easier—efficiency savings available in some parts of England are not necessarily applicable in Wales. The Prime Minister mentioned this morning savings from development agencies, but that opportunity has gone in Wales. It is particularly galling, I am sorry to say, that we are facing these cuts, given that the Liberal Democrats campaigned in Wales very much on the prospectus of raising public spending. Now we have not only cuts but no changes to the Barnett formula, in the foreseeable future at least.

We also have cuts in the numbers of additional university places. Again, the number for Wales is unclear, although one might speculate that it might be 500. This is particularly difficult given that universities in Wales are clearly underfunded as well. A study of cross-border education by the Welsh Affairs Committee, of which I was a member in the last Parliament, showed that universities in Wales were underfunded to the tune of £60 million per annum, and that university research in Wales was underfunded to the tune of about £40 million. Both sums of money, of course, would go far in filling the funding gap. Successive Labour Secretaries of State claimed that the Barnett formula has served Wales well, but it does not apply to research moneys. If it did, we would get not 2% but 5.6% of research money, which would make a huge difference.

I will not take up much more of the Chamber’s time, because many people are waiting to make their maiden speeches. I will add, however, that the One Wales Government—the red-green Government—in Cardiff are committed to social justice, sustainability and inclusivity, and firmly reject NHS privatisation and the market models in the health service. That might come as a surprise to some hon. Members who do not know the ins and outs of Welsh politics, but that is how it stands at the moment. That refers back to my earlier point about this country being the UK and not just England. The Welsh Assembly Government are also responsible for the Wales-wide practical curriculum, including a foundation, play-based phase for four to seven-year-olds. Were I in charge of taking lessons from Sweden, I would look at the universal child care available there, which I saw a couple of years ago on a visit with the all-party Sweden group, rather than at some of the other lessons that the Government are taking. We also have in Wales the Welsh baccalaureate and are developing 14-to-19 education in general. In this respect, I hope that Wales will be protected from the coalition’s wilder enthusiasms in respect of health and education, and I genuinely regret that that choice is not open to people in England.

19:16

[Gavin Barwell (Croydon Central) (Con)]

I am grateful for this opportunity to deliver my maiden speech as the new Member of Parliament for Croydon Central. I congratulate the hon. Member for Arfon (Hywel Williams) on his contribution and, in particular, my hon. Friend the Member for Bristol North West (Charlotte Leslie), who has just left the Chamber, on her maiden speech. I know how hard she has worked to get to this place.

It is traditional to start a maiden speech by paying tribute to one’s predecessor, and despite the fact that he was an opponent in the recent election, I have absolutely no hesitation in doing so. Andrew Pelling was elected to the House in 2005 as a Conservative, but for the last two and a half years sat as an independent Member. During his time here, he experienced a number of difficulties in his personal life, but despite them he was regarded in the constituency as an excellent local MP. In addition to his service in the House, he served the people of Croydon and the Conservative party as a local councillor for more than 20 years, and as a member of the Greater London assembly for eight years. He was one of the people who encouraged me to get involved in local politics, and I wish him well in whatever he chooses to do in the future. I hope that his contribution to public life is not at an end.

It is a great honour to represent Croydon. It has been my home since I was a few months old, and it is where my wife and I have chosen to bring up our children. There is no getting away from the fact that Croydon has an image problem—a reputation for rather unwelcoming 1960s architecture, and for crime and antisocial behaviour. The town centre is certainly in need of regeneration, which our Conservative council and its excellent chief executive, Jon Rouse—a former chief executive of the Commission for Architecture and the Built Environment—have ambitious plans to deliver as the economy emerges from recession. It is also true that crime is my constituents’ No. 1 concern, although it is lower than in many other London boroughs, and the town centre, in particular, is safer than it was a few years ago thanks to the efforts of our local police, led by Borough Commander Adrian Roberts.

Those two problems aside, Croydon has much going for it. Historically, it was a market town in Surrey, situated in a valley between the Crystal Palace escarpment and the north downs, just north of a gap in the downs and therefore on the natural route from London to the south coast. The Archbishop of Canterbury had his summer residence in the town, and some of the original buildings survive and today form part of Old Palace school. The arrival of the railways—first the Surrey iron railway between Croydon and Wandsworth in 1803, then connections to London in 1839 and Brighton in 1841—led to a 23-fold increase in Croydon’s population between 1801 and 1901, and as Croydon grew north, London grew south, and by the outbreak of the great war it had become part of the London metropolitan area.

Further change came after the second world war. The Croydon Corporation Act 1956, coupled with Government incentives for office relocation out of central London, led to almost 500,000 square metres of office space being built or given permission in just seven years—much of it in multi-storey blocks—plus an underpass and a flyover, which transformed the town from a market town into a mini Manhattan. Today, Croydon is a city in all but name, a major commercial and retail centre, and the largest metropolitan area in western Europe without city status. However, it is also part of London, the world’s greatest city. It has excellent transport links, including a 24-hour rail service to central London, Gatwick airport and the south coast. Croydon tramlink is London’s only tramline, and the East London line extension to West Croydon, which opened just over a week ago, has finally put Croydon on the tube map. As a result, Croydon residents can be in central London in just over 15 minutes, while living on the edge of the beautiful countryside of the north downs and not having to pay through the nose for housing.

Croydon’s greatest asset is undoubtedly its people, many of whom have come from all over the world to make it their home. They set up new businesses, work in our public services, contribute to the town’s thriving voluntary sector and enrich its culture, making it a vibrant, cosmopolitan place to live. The real Croydon is a mix of ancient and modern, city and countryside, long established and newly arrived. Like many suburbs, Croydon is not without its problems, but it is a great place to live.

I am grateful to have had the opportunity to make my maiden speech in this debate for three reasons. First, as a parent of three young boys, who I expect are watching at the moment, and as the chairman of governors at a local secondary school, education is an issue in which I have a personal interest. Secondly, it is also a key issue in my constituency, particularly in relation to secondary school standards, which I shall come to in a moment. Most importantly, if we want to lift people out of poverty and to increase social mobility in our country, then education, and not the ever more complicated tax and benefit system favoured by the previous Government, is surely the key to doing so, as the hon. Member for Luton South (Gavin Shuker) recognised. Of course it is important that young people leave school, college or university with the qualifications they need to get a job, but education is about much more than exam results. It is about inspiring children, raising their aspirations and giving them the confidence that if they work hard, they can fulfil their dreams.

Given the time available, there is just one more issue that I wish to raise—standards in secondary schools. My constituency is lucky to have some excellent state faith schools—Coloma Convent, a Roman Catholic school for girls, and Archbishop Tenison’s, a co-educational Church of England school, both of which deliver excellent results on limited budgets thanks to outstanding leadership by Maureen Martin and Richard Parrish respectively. We also have some excellent independent secondary schools—the Islamic Al-Khair school, as well as the Trinity and Old Palace schools, which are part of the foundation established more than 400 years ago by Archbishop Whitgift, about which I should declare an interest as a governor.

Until recently, parents who were not practising Christians and who did not wish or were not able to go independent had either to accept places at schools where standards were not high enough or send their children miles away to Bromley, Surrey or Sutton. Thankfully, a couple of years ago, our Conservative council took action to address the problem, replacing low-performing schools with new academies and putting in place plans to expand popular schools. Some of those plans are dependent on Building Schools for the Future funding, and I was therefore grateful to hear the Secretary of State’s positive comments in that regard earlier in the debate.

Unfortunately, not all councils are as progressive as mine. Too many turn a blind eye to low performance, rather than taking the tough decisions needed to turn things around. That is why it is so welcome that the coalition proposes to remove the monopoly of local councils and to allow parents, teachers, charities and local communities to set up new schools. Each year, thousands of parents are told that the inn is full. They are told that there are no places at any of the schools where they want to send their children and that they have either to send them to a school they did not choose or educate them at home. The policy that my right hon. Friend the Secretary of State has championed with such passion will provide another option to those parents, and the knowledge that a new school could open if enough local parents are dissatisfied will put pressure on low-performing schools across the country to raise their game.

The right hon. Member for Morley and Outwood (Ed Balls) is concerned that the proposals in the Queen’s Speech will create a two-tier system, but the reality is surely that the current system of catchment areas coupled with the local authority monopoly of supply allows well-off parents to move into the catchment areas of good schools and leaves the less well-off with little or no choice. It demonstrably does not ensure that everybody gets an equal education. The previous Government believed that a top-down approach was the best way to drive up standards. I believe that a bottom-up approach, based on parent and pupil choice, is far more likely to be successful. That is what my constituents want, and I look forward to supporting the measures when they come before the House.

19:24

[Roberta Blackman-Woods (City of Durham) (Lab)]

Let me begin by congratulating the hon. Member for Croydon Central (Gavin Barwell) on his maiden speech, which was extremely informative. It outlined not only the needs of his constituents, but the attractions of his constituency.

There are a great many measures in the Queen’s Speech that I am very concerned about, that I disagree with and that I think will be unhelpful to my constituents. There are also a few measures that I think will be unhelpful for our democracy, the most obvious of which is the proposal requiring the approval of 55% of the House for its Dissolution. I also think that a number of the measures proposed will undermine local democracy as it is embodied in our local councils. I am talking not only about the effect that drastic cuts will have on services, but about the proposals to remove most of our schools from the local authority family.

I have a number of concerns about the proposals on education, including those covered by the Department for Business, Innovation and Skills, that I want to outline, the first of which relates to the further withdrawal of funding from our universities. Like many others in the House, I believe that universities are the powerhouse of our future economy. They provide young people and others with the necessary skills to compete in the global jobs market now and into the future. The withdrawal of 10,000 places and the cutting of a further £200 million from the higher education budget is to be wholly deplored. I suspect that those who will lose out on a place this autumn will not be those from the most affluent backgrounds, but those who were hoping to benefit from Labour’s widening participation strategy and perhaps to be the first person in their family to go to university. What will happen to those young people if they do not gain a place at university? Are the Government going to offer them a job or alternative training, or will they simply throw them into unemployment?

That brings me to the cuts in the future jobs fund. We think that about 40,000 to 80,000 young people could be affected by the cuts in funding. It is interesting that both parties in the coalition thought that programme was a very good one before the election—and, indeed, it was. When Labour left office, there were around 40% fewer young people signing on than during the recession under the Tories in the 1990s. Labour Members will be taking a very careful look at how this issue plays out in the areas of the country that we represent that are most disadvantaged. In particular, we will look at how it feeds into youth unemployment.

The third issue that I want to address is that of academies. Like all Members of the House, I think, education in my constituency was transformed under the last Labour Government, with attainment levels improving from the low 30s, in percentage terms, in relation to those gaining five GCSEs. That figure was about 31% in the early 1990s, whereas currently the figure is higher than 80% for a number of schools in my constituency. That did not happen by accident: it happened because of the investment that Labour put in. But we are still waiting for our first academy. We have an excellent proposal, and a scheme that was approved by the last Labour Government is under way. It brings together a very interesting partnership between the excellence of Durham university, our local chamber of commerce and the local authority. I am seeking reassurance from the Secretary of State and his Ministers tonight that that excellent scheme will go ahead.

The House might be interested to hear that those new buildings, which are planned for 2013, were opposed by my Liberal Democrat opposition in the election. She told us in a focus leaflet—not the most reliable source of evidence, I know—that she was leading the opposition to the academy on ideological grounds. Those ideological grounds were, apparently, that she deplores—and thinks her party’s policy is against—any schools being brought out of the local authority family. I should therefore like to hear from the Government how they have managed to reconcile the huge differences between both parts of the coalition on academies and whether they used the services of Relate to bring them together.

I hope that those new buildings go ahead. Labour saw that investment as essential to improving opportunities for our young people, so I am very concerned about a policy that seeks to make all schools into academies without necessarily adding to their facilities or introducing new facilities. We all know that simply removing schools from the local authority will not necessarily lead to innovation or the driving up of standards that is necessary.

The fourth issue that I want to talk about is the free schools policy. At the moment, we probably have more questions about it than answers, and I am going to add a few questions of my own this evening. If there is a rush for free schools, how will the Government ensure that all areas benefit equally? If resources are directed to them, what will happen to existing schools, particularly in areas where there are falling rolls? If additional money is put into free schools, will it be taken away from others?

When the coalition parties talk about the pupil premium, they do not say much about the money already directed to disadvantaged schools through targeted grants. Again, I wonder whether those grants will be continued with the pupil premium. If the Government are going to withdraw them, they should make that very clear.

The last issue that I want to raise is that of free school meals. My hon. Friends the Members for Kingston upon Hull North (Diana R. Johnson) and for Washington and Sunderland West (Mrs Hodgson) and I, together with the public services trade unions, drove forward the campaign for free school meals. I am extremely fortunate to have a pilot scheme in my constituency. It is showing enormous benefits in improving the understanding among our very young people of the importance of eating well, and it is also helping them with their studies by enabling them to concentrate more. I would really like to hear from the Government this evening that they are going to continue and expand these excellent pilots, which are doing so much to tackle educational disadvantage and child poverty.

19:31

[Bob Russell (Colchester) (LD)]

I have been here throughout the debate and there have been some excellent maiden speeches. I congratulate all those who have spoken so far, and there will be more to come. I also thank those who paid tribute to their predecessors. That is appreciated as well.

I will be voting for the Queen’s Speech, warts and all, because I think that a Government must have a programme to take forward. However, I give notice that, when some of those warts come back, I shall need some convincing if I am to vote for them.

In Essex, there is an attraction about getting shot of Essex county council. It is not so much that it has a dead hand on education: as far as Colchester is concerned, it has a warped hand. The council has failed to listen to the people of my constituency even though, in a consultation exercise, in excess of 96% of them said no to the secondary school reorganisation.

If we can persuade the sixth-form college and the Colchester institute to come together with all the local secondary schools in a co-operative—or whatever name we want to give it—my hope is that we can build on what the coalition is putting forward and get shot of Essex county council. As the previous Government well knew, the council is a disaster as an education authority. Indeed, hon. Members who were in the last Parliament will know that I raised the shortcomings of the Essex education authority time and time again.

The coalition needs to look at a policy paper put to the Liberal Democrat spring conference of March 2009. It stated:

“the Academies model is unfair in relation to freedoms granted and unsustainable given the way it is centrally run from Westminster.

Liberal Democrats would replace the Academies programme with a new devolved model of Sponsor Managed Schools in which…All schools, including existing Academies (which would become Sponsor Managed Schools) would be under the strategic oversight of local authorities and not Ministers in Whitehall.”

Nothing that I have heard or seen in the succeeding year and a bit since has altered my view on that. A letter appeared in last Friday’s Liberal Democrat News from Helen Flynn of Skipton and Ripon, and I should like to put it on the record. It said:

“Though much has been achieved in terms of shoehorning in Lib Dem policy in many areas of the Coalition Agreement the Queen’s Speech shows how we have dropped the ball on education—massively.

It defies belief that as the party supposedly set apart for its stance on localism in education we have allowed in massive expansion of the Academies Programme, which is at once centralised as opposed to local in its accountability framework, and is divisive as opposed to inclusive in terms of its admission arrangements.”

I will delay more comment until the Second Reading of the Academies Bill. We look forward to that with great interest, but I return to the fact that Essex county council has failed the secondary school system in Colchester. I was greatly encouraged by the Secretary of State—and I shall be reading Hansard closely tomorrow—because I think that there is a glimmer of hope in what he said.

It was confirmed only this week that Colchester is the fastest growing borough in the country, yet Essex county council has plans to shut two secondary schools there when all the figures show that they should be retained, and that a new school will be required elsewhere. That is nonsense: shutting schools while expanding others to provide for up to as many as 2,000 pupils is not localism and does not make sense.

I hope that Colchester schools will come together and that we can save Thomas Lord Audley school in Berechurch and Alderman Blaxill school at Shrub End. In one of my interventions in the speech by the Secretary of State, I drew attention to early-day motion 25 in my name, which relates to the fitness of children. Linked with that is early-day motion 24 on learning outside the classroom, and Ministers may also want to look at early-day motion 65, which raises questions about the results achieved by academy schools.

Lastly, this debate is about education and health. I therefore urge the Secretary of State for Health to draw together health and education in an holistic approach, and bring education about first aid into the school curriculum. All the evidence shows that that would save the NHS tens of millions of pounds a year by reducing the numbers of people going to hospital accident and emergency departments. Lives would be saved in the precious two or three minutes after an incident happens, for example when someone falls down the stairs or is involved in a road crash.

To conclude, although I will be voting for the Queen’s Speech, I have set out my serious reservations about school academies and free schools.

19:37

[Mr Chuka Umunna (Streatham) (Lab)]

Thank you, Mr. Deputy Speaker, for calling me to give my maiden speech today. I congratulate my fellow south Londoner, the hon. Member for Croydon Central (Gavin Barwell), and others on their fine maiden speeches. It is a pleasure to be able to make mine in the same debate this evening.

I am deeply humbled to stand here as only the second Labour Member of Parliament for Streatham. Six individuals have represented the constituency since its creation in 1918. I am incredibly proud to succeed my very good friend the right hon. Keith Hill, who in 1992 became the first Labour Member to represent the constituency. Returning Members will know that Keith served in the last Labour Government, from 1997 until 2007, in a variety of roles. Most notably, he was Under-Secretary of State for Transport, as well as being Minister for London and Minister for Housing and Planning. He was also Parliamentary Private Secretary to the then Prime Minister, the right hon. Tony Blair, until the latter left office.

Keith is a larger-than-life person. He was, and is still, very respected in this House, and is remembered with great affection on all sides. He made a big contribution to this place and, above all, did so with great humour. In a tribute to Keith earlier this year, Mr Blair told how, at 11.57 am every Wednesday, just before Prime Minister’s Questions, Keith would arrive to take him to the Chamber, greeting him with the words, “Prime Minister, a grateful nation awaits your presence.” This never failed to bring a smile to Mr Blair’s face.

In May 2007, Keith announced that he would retire at the general election that we have just had because he thought that, at the age of 66, it was time to pass the baton on to a new generation. Notwithstanding Keith’s age—I do not think age should be a barrier—Keith always went about his work with a certain youthful vigour right up until retirement, and it will come as no surprise to those who know him well for me to tell the House that he is, at this very moment, surfing the waves in Cornwall in a wet suit.

I helped Keith with his constituency surgeries for half a decade and saw for myself what a fine Member for the constituency he was. He has been a great source of support to me, for which I am so grateful. I am conscious that I have very big shoes to fill, but I have every intention of living up to his very high standard.

From the bottom of my heart, I thank the good people of my constituency for electing me to succeed Keith as their Member of Parliament. I am the first Member for Streatham who was born and bred in the constituency, and it is such a privilege to represent them. The constituency is officially the centre of my universe. For the benefit of those who have yet to hop on the No. 159 bus just outside on Whitehall to go to Streatham, it is a constituency situated in south-west London and covers Streatham and parts of Balham, Brixton, Clapham and Tulse Hill in the London borough of Lambeth. The A23, which runs directly through the middle of the constituency taking in Brixton hill and Streatham high road, contains the longest piece of continuous high street in Europe.

The constituency is hugely diverse in many ways. With my own mixed English, Irish and Nigerian heritage, I am in many ways typical of the constituency, which is a very multicultural area. More than 35% of the population is, like me, from an ethnic minority, and there is also a big socio-economic mix, with the north of the constituency being quite inner-city in nature, and the south being more suburban. Like much of London, next to pockets of great wealth can be found areas of great deprivation.

Huge strides were made under the last Government in reducing deprivation in my constituency, be it through Sure Start—we have nine children’s centres—or through the numerous tax credit innovations that have helped keep people above the poverty line in my area. However, the big outstanding gap between the rich and the poor is there for all to see. This is something that I am determined to work to reduce during my time in the House.

Although there are outstanding problems, there is a terrific sense of community in the constituency. It is not broken in the way that some have described our country as being. “Broken” is a word which I think has been too loosely bandied about to describe our society. The word is often attached in television news reports to images of young people in inner-city areas like mine. That is reinforced by a tabloid media that at times presents young people as nothing but trouble. It is utterly deplorable to demonise our young people in this way.

Take the latest school exam results in our borough. Across Lambeth we saw success last year. Dunraven school in the middle of the constituency has a sixth-form centre that opened in 2003 to address the lack of A-level places. Last year, 70 per cent. of its A-level students got A to C grades. Likewise, the percentage of Lambeth pupils obtaining five or more A* to C GCSE grades soared to 71 per cent., which is well above the national average. These are not the results of a broken society.

There are planned building developments at three of the five secondary schools in my constituency that have not reached the financial close stage of development. We know that we do not see such results unless we invest in our schools. Those developments in my constituency are Building Schools for the Future projects. I hope that the Secretary of State for Education will at some point clarify the Government’s intentions in that regard. The hon. Member for Croydon Central referred to positive comments about BSF. I did not hear them myself, and I want to know what is going to happen about that.

We all understand the need to address the public sector deficit, but that cannot be at the expense of those to whom we are looking to grow our economy in the near future. Ensuring a return to economic growth is surely a key element in ensuring the recovery. The economic recession that we have just lived through was triggered by the global credit crunch that led to the collapse of several major financial institutions. The root causes of the global downturn are complex and varied, but a culture of excess and of recklessness in the banking sector undoubtedly played a role.

At the beginning of my legal career, I worked for just over three and a half years as a corporate employment lawyer in the City of London, and I acted for a number of institutions in the financial services sector on a variety of international transactions. I know from my time working in the City that it makes a big and important contribution to our economy, but a casino culture was allowed to develop there. In all parts of the House, it is acknowledged that the financial services sector needs to be better regulated. To say that things got out of hand is an understatement, so I welcome the continued prominence that the new Government are giving to reform of the financial services sector, and I intend to take a particular interest in how we reform it.

We must never again allow a situation to develop where the hard-working people whom we are elected to represent are left to pick up the tab for a financial crisis that was not of their making, jeopardising continued investment in our schools, hospitals and other public services that we are debating today. It is they whom we are elected to serve and I, for one, will never forget that.

19:45

[Paul Maynard (Blackpool North and Cleveleys) (Con)]

It is a very great pleasure to be here today. It has been quite a couple of weeks for the town of Blackpool. Not only did it elect me as a Member of Parliament, but we now have the delight of playing in the premiership next season, not just against Wolverhampton Wanderers, about whom we heard earlier, but against many other teams that I am sure we all support. I was thinking of buying a tangerine tie, which is our club colour, but I thought that that might push the politics of coalition that bit too far, as I do not own such a thing.

It was with great pleasure that in my acceptance speech on election night I paid tribute to Joan Humble. It was no problem for me at all and I am delighted to do so again. She was always courteous, unfailingly polite and gracious. I note that she is remembered with affection in all parts of the House. She was an excellent member of the Work and Pensions Committee. More important in my view was the work that she did with the all-party group on non-combat deaths in the military, particularly in the aftermath of the Deepcut inquiry. Her work on that group demonstrates to me what can be achieved as a Back Bencher. It is a useful lesson to all of us newer Members that we do not need to hanker after ministerial office to achieve in the House.

Joan was, of course, the Member for Blackpool, North and Fleetwood. There are people out there, beyond the Chamber, who take great interest in the nomenclature that attaches to constituencies. Cleveleys is a debutante in having a constituency named after it. It is an interesting town, partly because it does not really exist. There is another group of anoraks out there who know all about postcodes; they are obsessed with postal towns. Cleveleys is part of what is called Thornton Cleveleys. No one is quite sure where Thornton stops and Cleveleys starts or where the two merge.

Cleveleys has a distinct identity. It is attractive to day-trippers from across the north-west and beyond, as far south as Stoke, but it faces a number of challenges. I shall highlight one today that affects education and health: long-term care for the elderly and long-term medical conditions. At the time of the last census the Blackpool, North and Fleetwood constituency had the highest number of people living in a household where somebody had a long-term medical condition—some 42 per cent.

So I urge those on my Front Bench to bear in mind that what matters in health care is not just what occurs in an acute hospital. It is not just about what can be measured and put on a website as an indicator. It is about things such as quality, and perhaps most importantly—a word that I never hear often enough in political discourse—dignity. We cannot measure a patient’s dignity, but we know when they have lost it. Once again, I urge my Front-Bench team to put dignity at the heart of all they do in health care.

I pay tribute to Cleveleys first because I would hate it to feel overshadowed by its big brother to the south, Blackpool. I am sure all hon. Members know Blackpool. Many of them will have propped up the bar in the Imperial hotel in my constituency at many a conference. Everybody loves Blackpool, but I wonder whether they know much about the real Blackpool, the Blackpool behind the headlines. There are some extremely deprived parts of my constituency, and there are some real public health issues that we have to deal with as a Government. It is of great satisfaction to me that, as a party, the Conservatives started almost seven years ago working on improving public health policy. I pay tribute to the work that the Secretary of State has done in delivering an excellent public health document while in opposition. I hope we can build on that.

The other key issue that affects Blackpool, or the part that I represent, is educational aspiration. Sadly, we have some fairly underperforming schools that still have national challenge status. It is not easy running an education system in Blackpool. Deprivation does not make for easy pupils, and the staff in Blackpool do a tremendous job. Yes, results are slowly beginning to improve, but there is a poverty of aspiration within the town. Too many generations have not felt that education had any purpose for them; that there was any point in investing time in their studies so that they could build lives for themselves.

I feel passionately as a new Member that I want to introduce or try to reintroduce that culture of aspiration, because educational aspiration matters to me personally. As far as we can tell, I am the first Member of Parliament to be elected who attended a special school, and I particularly ask those on the Front Bench to pay special attention to needs of special schools, because they do matter. Had I not gone to that special school for the first few years of my education, I would not have been able to transfer to mainstream education. Without the speech therapy that I got at primary school, I might not have been able to stand here today and make a speech, so special needs education does matter.

Once again, as far as we can tell, I am also the first Member of Parliament to be elected who has cerebral palsy. I do not claim that that marks me out as anything special at all. I have never let it define my politics. Those who know me know that my interests are wide-ranging and far-reaching, and I will not let it define what I do in this Chamber—certainly not. I do not see myself as a role model for anyone. I have too many frailties, weaknesses and imperfections for that. I am but a weak and humble man after all.

None the less, I hope that I can be a role model to the many people out there who might feel that they want to play a role in public life, but may not quite have the confidence to do so. I know from experience that one needs a bit of courage, yes; a bit of self-deprecation, yes; and the humility to accept that sadly, yes, the bar is still that bit higher for some of us. I found that during my campaign, when my cerebral palsy was used against me by some. It surprised and shocked me, but on 29 April I picked up The Economist and read in an article about Arnold Schwarzenegger’s budget crisis in California that people with cerebral palsy and epilepsy—the combination I have—had “mental disabilities”. If a publication as august as The Economist cannot get it right, it shows that there is an awful lot of work to do.

Just last week, we celebrated the 40th anniversary of Lord Morris’s Chronically Sick and Disabled Persons Act 1970, which introduced the basic concept of rights for disabled people, an Act without which I would not be here in the public sphere today, and I pay tribute to that. But it is abundantly clear to me that no matter how much we legislate, no matter how many laws we pass, we cannot legislate for what occurs in people’s minds. I hope, by my presence in the House over the coming years, not so much by what I say but by the very fact of being here, that I can challenge some of the misconceptions, prejudices, fears and suspicions that go with my conditions.

19:53

[Cathy Jamieson (Kilmarnock and Loudoun) (Lab/Co-op)]

I am grateful to be given the opportunity to make my maiden speech in the House in such an important debate. I start by paying tribute to the excellent contribution from the hon. Member for Blackpool North and Cleveleys (Paul Maynard). I think that we would all agree that his maiden speech will be read time and again, and I hope that people will take account of it. It was very eloquent and I am sure that we will all have much to learn from his experiences in future.

As I make my maiden speech, I am conscious of and very humbled by the great privilege that has been bestowed on me by the people of Kilmarnock and Loudon electing me as their Member of Parliament. As people may be aware, I also serve in the Scottish Parliament, and those who know me from that place may have warned Mr Speaker and Mr Deputy Speaker that I need little encouragement to wax lyrical about my home town of Kilmarnock, not least because it is the home of Scotland’s oldest professional football team. My family roots are there as well as in the nearby mining community of Auchinleck, and my adopted home is in Mauchline, which was also home to Rabbie Burns. I will not have time today to extol the virtues of every town and village in my constituency, but I trust that I will, given Mr Speaker’s good grace, have the opportunity in future to talk at length about issues that matter to the people in my constituency, particularly when we come to debate jobs and the economy and how to revitalise our former coalfield communities and our former industrial towns, which is highly pertinent given the impending loss of jobs at the Kilmarnock Johnnie Walker plant.

Kilmarnock has an enviable history of representation. I am delighted to be the first woman to take my seat to represent Kilmarnock, if not the first woman elected to serve. At the general election in 1945, Clarice Shaw won the parliamentary election with a majority of just over 7,000 to become the first woman Labour Member of Parliament in Ayrshire. Unfortunately and tragically, she was struck down by a serious illness shortly afterwards, which stopped her ever attending the House of Commons, although she continued faithfully to deal with her parliamentary work until she was forced to resign in September 1946. I am grateful to a resident historian at the Kilmarnock Standard, Mr Frank Beattie—whose mother was one of my primary school teachers—for researching Clarice’s background and for a fascinating account of her journey. Clarice was a socialist and a co-operator, and I intend to bring those values and principles to the House on behalf of my constituents, and perhaps take up some of the issues that my predecessor was not able to take forward.

It is also an honour to represent the constituency of Kilmarnock and Loudon as a Labour and Co-operative Member, partly because that area is home to what is now generally recognised as the first consumer co-operative in Scotland, and—dare I say it—perhaps in the UK, if the Rochdale Pioneers will forgive me. The Fenwick Weavers Society began in the village of Fenwick in 1761—meeting at a place, incidentally, that is now known as the Parliament Wall. In 1769, the society expanded to become a consumer co-operative, initially designed to foster high standards in the craft of weaving, although activities later further expanded to include collective purchasing of bulk food items and books.

The need for the co-operative movement and those co-operative principles to be represented in this place has perhaps never been more important, particularly in light of the turmoil that our financial services sector has recently faced. Perhaps the near collapse of a system to which we have been intrinsically bound may be the crucible of a new beginning. Surely the time has come for co-operation to come to the fore again, and the idea of people owning and running their own democratically accountable banks has once again come of age.

Co-operation also brings new opportunities in education and health. Mutually owned and run care co-operatives are already providing more responsive services, and the principles of co-operation are taking root in many of our schools. I hope that the new Government will take account of those values and principles as they move forward rather than simply trying to rely on private sector solutions that have failed in the past.

Other notable representatives in Kilmarnock and Loudon include Willie Ross, who has legendary status, certainly in Scotland and probably also in the House. Although I hope to match his commitment, I doubt whether I will ever be able to match his skills of oratory. Similarly, the Member who followed him, Mr Willie McKelvey—much loved in Kilmarnock—was well known in the House not just for his wit but for his love of greyhounds. He was succeeded by the retiring Member for Kilmarnock and Loudon, Des Browne. Des will be a hard act to follow. He served this House in a number of important posts, in his own distinct and inimitable style. I pay tribute to his work on behalf of all my constituents and wish him well in his future political career in another place.

Let me say a few words on the subject of today’s debate. Having had the privilege of serving as a Minister for Education and Young People in Scotland, I hope to make meaningful contributions not only today but in future in relation to those matters. Education in Scotland is a devolved matter, but what happens in this House is important, particularly in terms of decisions on budgets, because what happens here has an impact on what is taken forward in the Scottish budget.

Like my hon. Friend the Member for Luton South (Gavin Shuker) who spoke earlier, I am very fortunate to have been one of the first pupils to go through the comprehensive education system when it was introduced, and I am pleased that the current constitutional settlement recognises the opportunity for us to do things differently in different parts of the UK. However, those solutions must be based on the underlying principle that every child is given the best possible start in life, with added support for those who, like myself, come from a low-income background, and for those whose life chances make things very difficult.

I want to conclude on a particular note, with a plea to the Government to reconsider their position on child trust funds and, specifically, the proposal to end the payment of such funds to looked-after children—some of the most vulnerable and needy children, for whom we all have responsibility. Those funds for looked-after children give youngsters who have been brought up in the care system the opportunity to move forward and go with some financial backing into further or higher education or the world of employment. Surely it is not too much to ask that any Government consider it important to look after those young people as we move forward.

I am grateful to have had the opportunity to speak to the House today. I hope that the Government will address those issues, and I look forward to being able to play a meaningful role in, and make a meaningful contribution to, our debates in future.

20:01

[Neil Carmichael (Stroud) (Con)]

Thank you very much indeed for inviting me to speak, Mr Deputy Speaker. I have been very impressed with the numerous debates to which I have listened, and the one thing that I have learned about the House is that one does have to be patient from time to time. I completely agree with the hon. Member for Kilmarnock and Loudoun (Cathy Jamieson) about the power of the speech of my hon. Friend the Member for Blackpool North and Cleveleys (Paul Maynard). It was outstanding, and it will be one of those that everybody remembers—and quite right, too. It was also so right that he emphasised the need for special education. That is of pivotal importance, and he should be appreciated for that.

I want to talk about two of my predecessors. The first is Lord John Russell, who was twice Prime Minister and once MP for Stroud, between 1835 and 1841. I do so because I want to emphasise the good neighbourliness that exists with our coalition partners—Lord John Russell being a Whig, a Liberal. That is a good sign that we will co-operate well, especially because he piloted the 1832 Reform Act through the House, and as the Deputy Prime Minister said recently, this Government will be as dramatic in shaping our constitution as the Government of that period were. That represents a signal change.

The next predecessor whom I want to mention is, of course, the one who preceded me, David Drew. He was an outstandingly good constituency MP. He served his constituents with total devotion, and there was never a stone left unturned in order to ensure that they were looked after. His will be a hard act for me to follow, but I intend to do just that. He was a very good constituency MP, and I therefore pay tribute to him. Incidentally, I wish him well in his new role as chairman of Forest Green Rovers, our local football team, which is based in Nailsworth. He has a job to do there, and I am sure that he will tackle it with vigour.

All constituencies are beautiful, but none is as beautiful as Stroud. I can prove that by reference to a king who was on his way back from the failed siege of Gloucester. That, of course, was King Charles I, who stopped off along the Painswick valley and was so impressed by it that he remarked that it was “paradise”. That name has stuck to the community in Painswick ever since. Stroud contains another four magnificently beautiful valleys, which all comprise really interesting communities and some fantastic reputations—for writing, with Laurie Lee, for example; for textiles, with the mills; and so on. We also have the vale, which is about the same size as the valleys put together. It is equally beautiful and impressive, but very different in terms of appearance.

Stroud has a number of other features which it is well worth telling the House about. One is its reputation for engineering and manufacturing. The businesses are usually small, but they are all really exciting and think about high added-value and new technology products. If we manage to support manufacturing and engineering, as we so desperately need to do, that is where Stroud and the whole country will find its economic growth once again.

Stroud is beautiful, as I have said, and we rejoice in the fact that we have got rid of the regional spatial planning system, because it is good to know that we will not be carpeting over green fields to the absolute outrage and fury of our residents. We need to build houses and more social housing, but that will come from proper local community activities, decided by local people. That is very exciting, and we already have a very strong movement through community land trusts.

I should mention agriculture. I am a farmer myself, and it is an important part of the constituency. We have big and small dairy farms, all of which are vulnerable to TB and struggling with the price of milk and so forth, so the House can expect that I shall be a steadfast supporter of agriculture.

Stroud has a good tradition for renewable energy and some exciting ideas about its promotion. Hydro is one good example, and we will see more of that as the Government unfold their policies to encourage renewable energy. That is good news for Stroud, and renewable energy is one of its characteristics.

I want to talk about education, and I have only two minutes and 46 seconds in which to do so. The Gracious Speech contains some important measures that will benefit Stroud and, indeed, this country. One is the move to academies, but the key thing to remember is that our task is to ensure that all schools are good schools. The issue is not just about the best schools; it is more important to talk about the schools that are having problems and failing, because we have to ensure that everybody can fulfil their lives. There is nothing more heartbreaking than discovering that people cannot do things simply because they have not had a decent education. That must, of course, be the fundamental point about our interest in education.

It is also critical to emphasise the importance of school leadership and management. I have had some experience of dealing with such issues as a governor of a school. I am still a governor of Stroud college, in which I must clearly declare an interest. Leadership and management in schools is critical because the most important thing about schools is the people who are in them—the people who do the teaching, who do the work, who deal with the pupils and who ensure that the pupils are given the best chance. We must never forget that.

Further education is an important subject. Sometimes it is the Cinderella of education, but I want to emphasise how important I think it is. Effectively, it is the facility that can overcome the problem of people who thrive not in schools but in vocations and in the further education environment, so it is absolutely right that the further education sector be helped as much as possible. Reducing the amount of bureaucracy and regulations is clearly one thing that must happen, but we must also tackle the question of funding. That is complicated, but we need to ensure that FE colleges know where the money is coming from. Governance of colleges and schools is important. Governors must recognise and take on their responsibilities, because if we are to have academies we must have capable governors and a governance system that works and ensures that schools are checked.

The House can be sure that I shall represent Stroud’s constituents as vigorously as David Drew did, and I shall also ensure that it is properly and powerfully represented in this House in terms of policy, holding the Government to account and ensuring that the people of Stroud thrive.

20:09

[Luciana Berger (Liverpool, Wavertree) (Lab/Co-op)]

I congratulate the hon. Member for Stroud (Neil Carmichael) and all those who made their fascinating maiden speeches that we have heard in this debate. It has been a real education. I thank you, Mr Deputy Speaker, for allowing me the opportunity to make my maiden speech in this debate. In his book “In Place of Fear”, Nye Bevan wrote of the frustration caused to new MPs who provocatively deliver the concerns of their constituents in their maiden speeches and are met simply by a polite response from the next speaker, according to parliamentary convention:

“After remaining in his seat a little longer, the new Member crawls out of the House with feelings of deep relief at having got it over with, mingled with a paralysing sense of frustration. The stone he thought he had thrown turned out to be a sponge.”

Notwithstanding parliamentary tradition, I shall endeavour to make my points provocatively, and to receive equally strong, uncompromising answers from Members opposite in due course.

I succeed the right hon. Jane Kennedy, an inspirational lady who served our nation and the people of Liverpool, Wavertree—formerly the constituency of Liverpool, Broadgreen—for nearly 20 years. She worked tirelessly for her constituents and was also a Minister in no fewer than six Departments. Her time as security Minister in Northern Ireland was precious to her. Jane was incredibly proud that it was the Labour Government who made such strides against the scourge of youth unemployment. When Jane was Minister for Work, there was virtually no youth unemployment, and serving as Health Minister, Jane was also so proud of the improvements made to our NHS under the previous Labour Government, particularly as they affected older constituents.

Jane did what so many could not or would not. I was struck by the number of people I met on Wavertree’s doorsteps who admired her greatly for the courageous actions that she took, particularly for her stance against the militant tendency. A brave woman, she will always remain an inspiration—never afraid to roll up her sleeves and get stuck in, even at the highest levels of Government. Jane did a sterling job for her constituents, for the Labour Government and in this House. As my friend and mentor, I hope to do her proud.

I have the privilege of representing the warm and kind people of Liverpool, Wavertree. It is a remarkably mixed constituency—culturally and historically rich, and ethnically diverse. It is a mixture of suburbia and metropolis, and a place where the old meets the new. We have our fair share of notable residents and landmarks from across the business, academic, musical, religious and political worlds. Wavertree is the birthplace of Meccano, Littlewoods pools and catalogue shopping. It is also home to the oldest Hindu community in the UK outside London.

Perhaps our most famous residents were John Lennon and George Harrison; Penny lane sits on the border of the constituency. Some lesser known people also deserve mention for the contribution they have made, not only to local life but also nationally. Dr Fred Freeman was a Wavertree businessman who owned a large department store in the constituency; he was also the philanthropist who pioneered tax-effective giving in the UK. James Newlands, a resident of Edge Hill, became the first borough engineer for Liverpool in 1847 and paved the way for municipal engineering as the world knows it today, creating the world’s first integrated sewerage system. The significance of that development cannot be overrated. During his years in office, Newlands succeeded in doubling the average life expectancy from 19 to 38.

Politically, the constituency has seen a whole spectrum of political representation. The new hon. Member for Suffolk Coastal (Dr Coffey) went to school in the constituency, as did Edwina Currie. Lord Alton was once its Member of Parliament and Derek Hatton lived in Childwall. Although Wavertree has been home to notable political representatives from across the political divide, it is the rich Labour witness within the constituency that has made such an impact. Stewart Headlam, one of the pioneers and publicists of Christian socialism, was born in Wavertree, and fiery campaigner “Battling Bessie” Braddock attended a Socialist Sunday school in Marmaduke street in the constituency. I intend to keep the rich socialist tradition alive.

We will be celebrating two notable anniversaries in Wavertree this year. In 1836 the world’s oldest passenger station, described by some historians as the start of the modern world, opened in Edge Hill, and this September marks the 180th anniversary of the opening of the Liverpool to Manchester railway line, which started at Edge Hill station. That was the first time anyone in the world could travel between two cities by rail. This celebration will be taking place at Metal, a creative hub that sits in the station today. We are also marking the 100-year anniversary of the Wavertree garden suburb, a development that was part of a national movement to improve urban living conditions, which gave tenants a stake in the place where they lived.

I requested the opportunity to make my maiden speech during the education and health debate because knowledge and well-being are so important to my constituents. I urge the right hon. Member for South Cambridgeshire (Mr Lansley) to honour the guarantee that he made in March to rebuild the Royal Liverpool hospital. The scheme is so important, not only to sustain the provision of high-quality health care for all the people of Liverpool, including many in my constituency, but also because it will be the catalyst for sustaining growth in the economic renaissance of Liverpool, with the creation of a globally excellent, biomedical science campus.

Similarly, as highlighted by my hon. Friend the Member for Liverpool, West Derby (Stephen Twigg), Alder Hey—the largest national children’s hospital in Europe, which treats young people from more than 85% of the UK’s PCTs—must see its accommodation upgraded. Alder Hey has put forward the most affordable hospital scheme in the country to replace its Florence Nightingale design from 100 years ago, so it can provide paediatric treatment in 21st-century facilities.

As a Labour and Co-operative MP, I am delighted that there have been real strides to expand mutualism in our public services. Mutualism ensures the promotion of democratic accountability—giving users, staff and other stakeholders a real say in how our public services are run. So far, the biggest expansion of mutuality has taken place in the NHS, with the formation of 129 NHS foundation trusts, which are accountable to a widely defined membership of more than 1.5 million. Similarly, in social care 178 user-led organisations have been created, and they both design and deliver high-quality services.

I move on to education. Incredible investment has been made into my constituency, where we have made great strides in education. Before the right hon. Member for Surrey Heath (Michael Gove) starts redirecting money from the education budget to create new free schools, I urge him to come and see how education is working in Liverpool. I urge him to invest in those schools, such as St Hilda’s in Picton and Archbishop Blanch School in Wavertree, that already have a vibrant community ethos and active governing bodies, and are already achieving above national-average grades at GCSE.

Nearly 90 years ago, my great-uncle, Manny Shinwell, newly elected as the Member for Linlithgowshire, made his maiden speech to this House. It feels almost eerie now to echo the words that he said then, that

“in opposition we would bring every kind of pressure—constitutional pressure, I may say—to bear on the”

Coalition

“Government in order to compel the Government to implement the pledges they gave”.—[Official Report, 23 November 1922; Vol. 159, c. 119.]

[Mr Deputy Speaker (Hugh Bayley)]

Order. That was a wonderful maiden speech, but I am afraid that the clock stops for no one in this place. I call David Ward.

20:17

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

I praise the hon. Member for Liverpool, Wavertree (Luciana Berger) and all those who have made their maiden speeches for their eloquence and endurance. It is customary during a maiden speech to speak in complimentary and glowing terms—indeed, frivolous terms in some cases—about the relevant constituency. However, I hope people do not mind if, as a Bradford councillor, I pass on that and leave it until another occasion.

I love my constituency, I really do, but it does have its problems. I fought it five times over a period of 20 years and I never considered for even one second trying to be an MP anywhere else. I am proud to be an MP, but even prouder to be MP for Bradford East.

I shall get one thing out of the way. I did not know Terry Rooney, my predecessor, too well, although I fought him five times. I do know, however, that he was a colleague of many here and gave 20 years’ service to the House. He put in many years’ work on the Work and Pensions Committee and chaired it. I pay tribute to him.

I have extensive yet limited experience of education; I shall try to explain what I mean by that. The extensive experience includes working for Leeds Metropolitan university for nearly 25 years. I cannot say that I regret having failed to come here sooner, because that would have meant my missing out on my wonderful memories of working with thousands of bright, funny, infuriating, creative and inspiring young people.

For the past five years, I have been seconded to Bradford City football club. I went there to help it to create a community department to engage with the predominantly Pakistani-Bangladeshi community that surrounds the club in Manningham. It is now host to a positive lifestyle centre, which has run programmes for more than 11,000 school children in the past five years. There is the football in the community scheme, which works with 130 of Bradford’s schools. I am probably most proud of all to be associated with my hero, Andy Sykes, who joined the British National party, understood how he had made an error, was going to leave, went undercover and was featured in the BBC documentary “The Secret Agent”. Andy was that man, and he now works with Dale Althorp carrying out some really tough work across the country with some really tough young people with extreme racist views.

For 26 years, I was a councillor in a ward in Bradford, where I was a group spokesperson for education. For four years, I held the education portfolio at a very difficult time, with a privatised education service, an Ofsted inspection that was one of the worst in the whole country, a move from a three to a two-tier education system, and the closure of all special schools and the reopening of new schools with co-located mainstream schools. For nearly 30 years, I have also been a school governor in special, primary and secondary schools, and I am still a governor at two schools in Bradford.

Bradford has one of the fastest growing populations in the country, and one of the youngest. Believe it or not, one in four of the population in Bradford East is under the age of 25. That is scary, because many of those young people are failing quite badly educationally. There is a view—we have heard it tonight—that if one can only improve the educational outcomes of children in deprived communities, that will somehow break the cycle of deprivation. Well, that is not my experience. It is not by raising educational outcomes that we reduce deprivation—it is by reducing deprivation that we raise educational outcomes. This is why I intervened earlier. We need to look at all the possible determinants of educational attainment, including gender, ethnicity, religion, and school structure—we have been through them all: community, foundation, grant maintained, academies, city technology and private. Nothing, but nothing, compares with deprivation as the overwhelming determinant of a pupil’s academic success and later, sadly, their prospects for employment, mental health, physical health and life expectancy. In education, class really does matter.

Yes, schools can be improved—I have been there—by better leadership, management, governance, teaching, learning, and freedoms from central Government. However, all head teachers and governors know that the most effective way of improving attainment is to change the intake of a school. I get very angry when I hear people glibly talking about good, bad or failing schools. I was chair of governors at a school branded as a failure—part of the national challenge—because of its attainment levels. At the same time, it was the first secondary school in Bradford to be categorised by Ofsted as outstanding—madness. Schools in the more affluent parts of Bradford district are deemed to be good, but only because of their A to C grade attainment. They are left standing, in terms of contextual value added, by many inner-city schools that are looked down on.

The Queen’s Speech—certainly, the agreement—contains many education proposals that I welcome. The slimmed-down national curriculum and flexibility in terms and conditions are necessary if the pupil premium is to work. I am not sure why these freedoms cannot just be made available to all schools, and why that has to be the preserve of academies. The most important freedom is not from overpowering local authorities, which can be controlled—perhaps unlike Essex. That view is out of date. The most important freedom is from the strangulating control of local education and authorities and schools by central Government.

The pupil premium, which is conspicuous by its absence in the Queen’s Speech, offers the real prospect of redressing the disadvantage faced by young people from deprived backgrounds. There is already deprivation funding, but it is a pittance. By and large, the amount of money that a school gets is based on the number of pupils in the school. That cannot be right, because going into an Ilkley primary school on a Monday morning is not the same as going into a school in BD3, the area that I represent.

I said that my experience of education is extensive but limited. It is extensive because of what I have done, but limited because of where it has been—in Bradford. I acknowledge that. However, it is that understanding of Bradford that I was sent here to voice. In a place such as Bradford, proposals for more faith schools and academies and the rights of parents to set up their own schools threaten social cohesion, strategic planning of school places, co-ordination of admissions and collaborative partnerships. I worry about that.

For many years, my wife has worked in a service providing support for Travellers, Gypsies, Roma, asylum seekers and refugees. My personal test of new academies and free schools will be based not on their standing in a league table showing key stage 2 and 4 results, but on the extent to which they provide a helping hand for the clients my wife represents. We will wait and see.

20:26

[Lisa Nandy (Wigan) (Lab)]

Thank you, Mr Deputy Speaker, for giving me the opportunity to address the House for the first time. It is a great pleasure to follow the very many hon. Members who have also done so and have spoken so passionately about their constituencies. I will listen with interest over the next few days as many more Members do the same.

Our duty to our constituents is one that we share in all parts of the House, and this debate could not be more relevant to my constituents in Wigan. Even with the much-needed investment over the past 13 years, people in Wigan still get sick earlier and die younger, and too many of their children leave school without good jobs to go to or without the qualifications they need for the jobs that there are. Those facts are a scar on the conscience of this House, and we must not rest until social justice is a reality in Wigan and across the country.

I know that that is a view that I share with my predecessor, Neil Turner. Neil drew on several decades of experience in, and service to, local government when he arrived in the House 11 years ago after the tragic death of his predecessor, Roger Stott. In his leading role in SIGOMA—the special interest group of municipal authorities—which is the campaigning network for local authorities, Neil fought hard for better public services, particularly housing, which was one of his passions. He was proud to be a Parliamentary Private Secretary to a number of Ministers, including my right hon. Friend the Member for Wentworth and Dearne (John Healey), who has done such important work in this field. Neil was also a leading light in another of his passions—the all-party rugby league group—and I think it is fair to say that he has taught me literally everything I know about rugby league.

However, it is for his tireless work in redressing inequality in health funding that I think Neil will really be remembered. He fought for, and got, recognition that places such as Wigan were chronically and unfairly underfunded. The results of this change in Wigan have been visible and striking. To suggest that his work has saved lives is not an overstatement: it could not be more important to the people I now represent. It is this perseverance that marks Neil out both as a politician and as a person. It is rooted in a generosity and a kindness from which I have also benefited. His refusal to give up when he was told, firmly, “No”, was a beacon of hope to a people who frankly deserved better, and an example that I am determined to follow.

Neil and I are both part of a long line of Labour representatives of Wigan that stretches all the way back to 1918. Many hon. Members will know much of Wigan’s history. It is a town that has endured great hardship, but at great cost. From the great depression to the extreme poverty and deprivation that George Orwell railed against in “The Road to Wigan Pier,” Wigan has achieved extraordinary things, too often against the odds.

The scars that still run deepest in my constituency are those that were formed by the decimation of the town’s historic mining and industrial base in the 1980s. It was in that divisive and heated decade that my politics were forged. I grew up in the north-west believing that the Government not only did not speak up for people like me, but actively opposed us. My challenge to the new Government is not to repeat that bitter experience.

I address that challenge to both sides of the House. In Wigan, there is pride in what we have achieved, but that is mixed with frustration at what we have not, and fear for the future. I believe we can and must do more. For the past five years, I have worked at the Children’s Society with some remarkable children caught up in that situation. It has been devastating to see them living with the consequences of decades of under-investment, and growing up in poverty with inadequate housing. However, it has been equally devastating to work with their classmates, who fled persecution abroad to seek safety in the UK, but who often have been blamed for the problems faced by their peers. We owe it to those children not to play politics with their lives and to challenge the politics of fear and hatred, rather than pander to it.

I believe there is reason to hope for better. I am privileged to come from a family that spans a wide political spectrum from liberalism to Marxism, which gives me the belief that things can be better, that assumptions can be challenged and that those things can be achieved without delay, however difficult the times. Wigan has bucked the national trend through the efforts of its excellent council and many hard-working community groups. We have kept youth unemployment low and attracted new investment, such as from the Tote and Keep Britain Tidy. We have retained important employers, such as Heinz, and have world-class rugby league and football teams, which crucially support a strong network of community sports clubs.

Perhaps more importantly, through testing times Wigan has always fought against the politics of hate with the politics of hope. The story of Wigan is the story of a community that has refused to be characterised by poverty, despair or fear throughout its history. No group could better embody that than Wigan and Leigh United Against Racism, whose thriving and energetic presence I am proud to be associated with.

It is with that sense of energy and ambition that I approach this Parliament. I am ambitious for positive new solutions where they are so badly needed, but I am also ambitious for respect for those policies that have served us so well. We must continue to invest in social housing, including council housing, and we must strive for a level playing field in education if we want a society in which the choices we make are more important than what we are born into. Decent workplace rights and strong trade unions will always be the most fundamentally effective way to tackle fear about immigration. If we are serious about showing people that we are on their side, we should back the living wage and the minimum income guarantee. We must lift people up, not drive others down.

We face a clear choice in this Parliament: a fairer, more equal society or a return to the inequality and despair of the 1980s. My promise to this House is to work tirelessly, fairly and constructively to achieve the former, but my promise to the people of Wigan is to fight every inch of the way if they face the latter. There is a generation of children and young people in my constituency who are expecting us to succeed, and there are older generations who have worked tirelessly for just that. We must do the same in this House, because we cannot afford to fail.

20:32

Heather Wheeler (South Derbyshire) (Con): I stand to make my maiden speech, which is a daunting task not least because my seat has been represented by such colourful MPs in the past. This is the seat that was looked after by George Brown and Edwina Currie. The lady has been mentioned twice tonight—what a night for her. My immediate predecessor, Mark Todd, was a diligent constituency MP—indeed, having had Brown and Currie, such a quiet and thoughtful man looking after us for 13 years was definitely a time of respite and calm from the spotlight that the earlier incumbents drew to the area. I wish him well with his new job as chairman of Derby City primary care trust.

South Derbyshire is a great place to live, work and visit. We are a semi-rural constituency made up of 84,000 acres and 98,000 people, so the idea of a 100,000-person constituency in two years’ time is perfect. We are the fifth fastest growing district in the country and at the centre of the constituency is our largest employer, Toyota. I particularly wanted to speak in today’s debate on the Gracious Speech because education and the provision of schools and apprenticeships are crucial to the future success of my residents. I have already had a request for the Minister to visit to discuss the setting up of a new free school by parents who run Dame Catherine Harpur school in Ticknall. We also desperately need a new secondary school near Melbourne and that initiative will help with that too. I have held meetings with other colleagues who are in the House tonight who have also met with the unions at Rolls-Royce. We have been working on some innovative ideas for apprenticeships that I hope we will be able to take further. One glaring omission from the services that we have in South Derbyshire is a college. All our residents have to travel for full-time further education, and there is an opportunity for us to do better for my residents.

South Derbyshire has a great history. Indeed, it is the resting place of the Mercian Kings, was invaded by Vikings and has a diverse economy, with a split of 27% based on manufacturing and 27% on tourism. We have a strong heritage, from market gardening to coal mining and clay pots. We have the largest inland marina, and our canals are a major attraction in the area.

I am even more proud that we are at the heart of the national forest, with Rosliston forestry centre receiving thousands of visitors every year. South Derbyshire is always reinventing itself and being host to new ideas. Right now, a new golf academy is being built, which will have apprenticeships for the next generation to learn to excel. At one end of Swadlincote is a dry ski centre and at the other a golf course. When people visit, they are not bored.

My aims for the future are to build on the great reputation that we have for hard workers. We are at the heart of the country and our inward investment plans will lead to even more companies from Japan, China, Sweden and all over basing themselves in South Derbyshire. That will happen because we intend to get the future education of our children right, and I intend to play my part in working with Ministers to make that happen. I am proud to represent the area in which I live, and I look forward to encouraging the Minister to visit us shortly.

20:36

[Paul Blomfield (Sheffield Central) (Lab)]

I congratulate the hon. Member for South Derbyshire (Heather Wheeler) on her speech. It is a wonderful part of the country to visit, as I do regularly from Sheffield. I also share the hon. Lady’s passion for manufacturing.

It is an extraordinary privilege for new Members to address the House for the first time. For me, Sheffield Central is an extraordinary constituency to represent. Significantly redrawn in the last boundary review, stretching from Hillsborough Corner to Manor Top, from Kelham Island to Carterknowle, it is the heart of Sheffield. It is also a special privilege to represent the city that is my home, although my son would be the first to point out that I do not really count as a Sheffielder because, unlike him, I was not born and bred there. He would say that I am an incomer because I first moved to the city at the age of nine.

Hugely diverse, Sheffield Central includes both Victorian Broomhill, which was once described by John Betjeman as the “prettiest suburb in England” and the Park Hill flats, which opened in 1961 to international acclaim, as an innovative replacement by the Labour council of the time for tenements and back-to-back slum housing. Now the largest grade 2 listed building in the UK, Park Hill is currently being refurbished in a major regeneration project, combining social housing, owner occupation, and business units. I hope that the project will be supported by this Government as strongly as it was by the last.

Among the neighbouring constituencies is Sheffield, Hallam, which is of course represented by the Deputy Prime Minister. A consistent message in his election literature, of which I saw a great deal, was “If you don't want the Conservatives, vote Liberal Democrat here”. I wonder whether he is now reflecting on that message, because I can assure him that many Sheffield voters are doing so.

The constituency was previously represented by Richard Caborn, and I pay a deep and genuine tribute to his work here over 27 years. In considering my maiden speech today, I looked up Richard’s from 1983. Having not spoken in the House until November of that year, he referred to an article in The Sunday Times, which had described him as a “tight-lipped Member of Parliament”. Now I have heard Richard described as many things, but those who knew him in this House and in Sheffield would never call him “'tight-lipped”. He is someone who has always been quick to share his views, and to do so robustly. But he is someone who has the special talent of provoking argument, respect and affection at the same time and he is recognised across Sheffield as a relentless champion of the city he loves.

Richard’s roots are in the steel industry. One of the things that he was proudest of was his role over the past three years in helping to secure an £80 million loan for Sheffield Forgemasters, which is facilitating an investment of £140 million to enable the purchase of a major new forging press, the largest in the world outside Japan and Korea. I am deeply concerned that the new Government are reviewing that loan. Speaking in Yorkshire last week, the Prime Minister said that he wanted to encourage manufacturing, particularly outside the south-east and particularly in high-tech engineering and low-carbon technology industries. If that statement is to have any meaning, the Government need to act quickly to end the uncertainty and confirm the loan facility for Sheffield Forgemasters.

Future jobs and prosperity in Sheffield will be built not only on the skills of our traditional industries, but on the research and innovation of our two universities. Both are located in my constituency. I have spent most of my working life in one—the university of Sheffield—and several years as a governor in the other, Sheffield Hallam university. They play a key role in supporting economic development in the region. Sheffield Hallam university has worked with local companies in pioneering product development. The university of Sheffield has used its research collaboration to apply specialist engineering expertise to real-world manufacturing problems, most notably in the Advanced Manufacturing Research Centre, established in partnership with Boeing.

Both universities are leaders in their sectors, and they make Sheffield an increasingly popular destination for students. Together, their students account for 10% of the city’s population, and the direct economic benefit is more than £1 billion. I therefore speak for many people in Sheffield when I express concern that the new Government have chosen to target universities in the first wave of cuts. Reducing funding and university places will damage economic development and crush the hopes of thousands of young people. Funding the nation’s universities must be a priority for this Parliament. When we consider the Browne review, we should ensure that it considers all the options and does not limit itself to a debate about the level of tuition fees.

The city of Sheffield is constantly seeking new opportunities. As chair of the city trust for 11 years, I had responsibility for many of our sports and cultural facilities, and I have seen the economic benefits of the international events that we have hosted. I am proud that we were recognised as the UK’s first city of sport and, with our thriving cultural industries sector, that we have been shortlisted as a candidate to be the UK city of culture in 2013.

We also have a great radical tradition in Sheffield. We were the first major city in the country to elect a Labour council, replacing—perhaps presciently—a Liberal-Conservative coalition. That early Labour administration did away with slum housing, through a radical programme of house building, tackled childhood disease and led the way with innovative environmental policies. That tradition continues today. We are the UK’s first “City of Sanctuary”, having welcomed refugees from throughout the world—people who have added to the rich range of cultures that form the constituency of Sheffield Central.

As I said in opening my remarks, it is an extraordinary privilege to take my seat in this House. There is a special responsibility on all of us who do so at this time to rebuild trust and confidence in democratic politics. I am pleased to commit myself to that task and to thank the people of Sheffield Central for giving me that opportunity.

20:44

[Christopher Pincher (Tamworth) (Con)]

First, let me pay tribute to the hon. Member for Sheffield Central (Paul Blomfield) for his wry and measured contribution.

I remember reading many years ago that an august former Member of this House once said that one’s maiden speech was the easiest speech that one would ever have to make in the House of Commons. Standing here now, I suspect that I speak for a few people who were in the same position earlier this evening when I say that that former hon. Member had a very singular interpretation of the word “easy”; because although this is a tremendous honour, it is also terrifically intimidating. I can therefore tell the House that nobody is looking forward to the end of my speech more than I am.

I shall say a few words first about Tamworth and then about my predecessors. Tamworth is an ancient town whose history stretches back to when England was formed. It was founded in 874 by King Offa, who built the dyke to keep out the Welsh. Sadly, his defences did not extend to keeping out the Danes, who came and burned the town down a few years later. The townsfolk were not daunted, however. They picked themselves up, got themselves together and rebuilt their town. That did not commend itself to the Danes, who promptly returned and burned it down again. It says something about the resilience of the people of Tamworth that they did not give up. They built their town again, this time with the help of the Normans, who built a castle to protect it. The castle is still standing, and the Danes never returned. Ever since that time, through the reign of Edward II, when the town received its charter, and the reign of Elizabeth I, when it got another, to the age of Peel, when Tamworth played host to the launch of the Conservative party with the Tamworth manifesto, the town has been at the heart of England. It has been part of our national history and identity.

Sadly, not enough people know about Tamworth’s history. When I tell people that I come from there, they say, “Ah, yes. The Snowdome!” or “Ah, yes. The Tamworth Two! The escapee pigs that caused such a furore during the BSE scandal eight years ago.” They do not mention Peel or the Tamworth manifesto. So I hope that when the Secretary of State for Education introduces his education proposals, he will ensure that history is set first and foremost in the teaching of young people, so that they can learn much more about Tamworth and the Tamworth manifesto, and a little less about the Tamworth Two.

Let me now say a few words about the issue at hand. Education is an extremely important subject in Tamworth. We have suffered for many years as one of the poorest-funded local education authorities in the country. That sets children in Tamworth apart; they start at a disadvantage. We need to even up the opportunities for young people there, which is why I welcome my right hon. Friend’s invitation to head teachers to apply for academy status, and his proposal to lift the burden of bureaucracy off the backs of teachers and to give them more power. Only if we give head teachers more power and more money to spend on their schools as they see fit, and only if we give teachers the time and the space to teach, which is what they want to do, will we drive up educational standards and improve the morale of the teaching profession.

But it is not just a question of improving education; it is also a question of providing job opportunities. The Government need to get the burden of bureaucracy off the backs of businesses, so that they can grow, prosper and create new jobs. In that way, the children who are now leaving school in Tamworth can be employed and build their own prosperity. I hope that, when the Government introduce their great repeal Bill, the Secretary of State for Education will use all his artistry and eloquence to prevail upon his right hon. Friend the Deputy Prime Minister to focus not only on civil liberties but on the promotion and preservation of business liberty. I want to see a bonfire of red tape, so that businesses in my constituency—such as Forensic Pathways and Alcon—can grow and prosper, and employ and reward more people. Personal prosperity is the best guarantee of liberty, and I hope that the Government will take that on board.

I should like to say a few words about my predecessors. Tamworth is an old constituency, and it has had a long line of great—sometimes rather colourful—Members of Parliament. In the 18th century, our Member, Sir Thomas Guy, built our almshouses before going to London to build his hospital. Peel, whom I have already mentioned, was a great Member for Tamworth. He founded the police force, reformed our penal laws and emancipated the Catholics. He also repealed the corn laws, thus enshrining free trade as a fundamental principle of the Conservative party. He was a great statesman who represented Tamworth. Incidentally, he also had the county boundary of Staffordshire moved so that his house fell within his constituency. Now I do not suppose that the modern Boundary Commission would be quite so accommodating to any such request I might make, which I suspect is the price we pay for progress.

More recently, as some Members might remember, we had Sir David Lightbown—a Member much loved in his constituency, but much feared in the passageways of this Palace. My hon. Friend the Member for Mid Worcestershire (Peter Luff) reminded me that that was true, to his own cost, some years ago, when Sir David, a Whip of some considerable stature, picked him up by the lapels to remind him which Division Lobby he was meant to be going into that night.

My immediate predecessor was Brian Jenkins, who held the seat for 14 years, in which time he worked hard to put his constituents first and foremost. During the six years I have been a candidate in Tamworth, I have never heard a bad word said about Brian Jenkins, who I think genuinely demonstrates that an MP does not have to sit on the Treasury Bench or be a great orator or firebrand like the hon. Member for Bolsover (Mr Skinner) in order to be a good parliamentarian. Brian Jenkins served his constituents conscientiously and quietly for 14 years. If I can work as hard for them as he did, I will reckon myself a good parliamentarian.

It is a great honour to stand in this spot where Peel must have stood close by. I said at my count just a month ago that it was the honour of my life to be sent here by the people of Tamworth, and so it is. I feel that honour acutely tonight, and I hope that, however many speeches I make, however long I am here, however many brickbats get thrown up from this or that side, I will acutely remember that honour.

20:52

[Valerie Vaz (Walsall South) (Lab)]

I congratulate all the new Members who have made their first speeches, as well as thank the old Members who have stayed in their places to listen to us. I am grateful to you, Mr Deputy Speaker, for allowing me to make my first speech in the House. I would like to place on record my thanks to those in the offices of the House who set up the induction day, which made our life as new Members much easier and helped us to settle in.

Members will have noticed that I share the same surname as my right hon. Friend the Member for Leicester East (Keith Vaz). There has already been some confusion, as some Members think I am his daughter, while others think I am his wife. Thankfully, no one has suggested yet that I look like his mother, but that may be to come. For the record, I am his sister, and I have had congratulations and commiserations in equal numbers for that. It was our parents, Merlyn and Tony—sadly, both now deceased—who taught us about public service and that when much is given, much is expected. After my father died, my mother brought up three teenagers single-handedly. All three of us became lawyers, but that was not her fault. She found time when she was a pensioner to become a councillor and set up the first senior citizens committee, highlighting that important and growing group of citizens. Her initiative to give Christmas hampers to senior citizens was legendary.

There is an invisible thread that links me standing here today with Emily Davison—the suffragists and the suffragettes, but particularly Emily Davison—because she hid in a cupboard below the west cloisters, so that her address in the 1911 census would be the House of Commons. A former right hon. Member, Tony Benn, placed a plaque there so that we can remember her. It is because of her actions that I am able to give my address as the House of Commons.

Following custom and practice, I want to pay tribute to my predecessor, Bruce George. He was a Member of Parliament for 36 years. He was a member of the Select Committee on Defence and then its Chairman, but his heart and soul always remained in Walsall; he cared about Walsall and its people above all else.

In his first speech, Bruce referred to part of his constituency that was represented by the late John Stonehouse. Members will recall what was said about him—that he was the only Postmaster General to sew his own mailbags. Curiously, he stood in Twickenham, as I did in my first attempt in a parliamentary election in 1987. I also have a link to the right hon. Member for Twickenham (Vince Cable), as we both have family who come from Goa, India—mine by birth and his from his first marriage.

A previous Member of Parliament for Walsall South, Sir Henry D’Avigdor-Goldsmid, referred to Walsall in his first speech as a town of a hundred trades. Many have gone, particularly the steel industry, but I am pleased to say on this coronation day that our Gracious Sovereign’s handbags are still made in a factory in Chuckery.

Walsall is also a place that has seen the fruits of regeneration. Massive investment by the previous Government made possible the completion of the Manor hospital, and I pay tribute to my hon. Friend the Member for Walsall North (Mr Winnick) for the huge part that he played in ensuring that funds were secured. There has also been regeneration in the town centre, and there is new housing. There is a refurbished Walsall college, and a new Tesco site that will create nearly 3,000 jobs.

The creative arts are celebrated in the New Art Gallery Walsall, an iconic building which I urge Members to visit. At the gallery there is a new generation of poets: Helen Calcutt, who, with her father David Calcutt, a renowned writer and poet, performed her poem celebrating regeneration, entitled “Where there was nothing”. She referred to another iconic part of Walsall’s skyscape,

“to the thought of light’s near breaking, over the bell tower, over St Matthews Spire.”

That continues the literary tradition of Walsall, for it is in Caldmore—pronounced “carma”; they do things differently in Walsall—that Jerome K. Jerome was born. Members will recall the first line of “Three Men in a Boat”:

“There were four of us”.

That seems so relevant to this coalition Government.

Walsall South is a constituency of contrasts. There is a farm at Pheasey Park Farm, and, at the other end, the vibrant, close community of Palfrey and Pleck. However, there are inequalities. When it comes to one of the key performance indicators at GCSE grades A to C, there is a contrast between one end of the constituency and the other. In Paddock, an affluent ward, the rate is 100%, whereas in Darlaston it is 41%. That is why it is important that Joseph Leckie school, which was in line for repairs and upgrading from the Building Schools for the Future fund, is not overlooked in any future decision.

I do not think that education can be measured as a unit or in fiscal terms. I would like the Wellington College well-being course to be taught in every school, because it is a design for life. Education is continuous. From birth, there is Sure Start. I am pleased that the Government have no plans to dismantle it, especially as there are 17 schemes in Walsall, and in Palfrey good work is done with both fathers and mothers. However, it concerns me that the 5,000 child trust funds that were started in Walsall South will end. The funds are a gift from the state to children, and, in my view, teach them fiscal responsibility, because they can track their investment as they grow up.

I ask the Government to rethink the future jobs fund. My right hon. Friend the Member for Normanton, Pontefract and Castleford (Yvette Cooper) and I saw its work at first hand. Young people who would have been on the dole were taught skills. There was no Government interference, but money was given directly to local organisations which taught skills to match the available jobs. When I asked what the young people received at the end, I was told that they received a CV and a reference—along with, I am sure, lashings of self-esteem.

Many of my constituents are very distressed by the events that have taken place in international waters near Gaza. I am pleased that the Foreign Secretary and the shadow Foreign Secretary have made strong statements, and I support them, but the blockade must be lifted. Aid and construction materials should be allowed under the supervision of the EU and the UN. Anyone who attended the BBC Proms, where the East West Divan Orchestra played—the initiative of Daniel Barenboim and the late Edward Said—will see hope for the future. When people meet, they do not fear each other. The children of Israel and Palestine should hear music, laughter and their parents’ voices, not gunfire and the mourning of lost lives.

Let me end by saying that there is a strong feeling among Members to whom I have spoken, new and old, that we will do good work together in the House, and go some way towards restoring trust in Parliament. I pledge that to the House, and to the people of Walsall South.

20:59

[Simon Wright (Norwich South) (LD)]

Thank you, Mr Deputy Speaker, for giving me this opportunity to make my maiden speech. I am pleased to follow the maiden speeches of the hon. Members for Walsall South (Valerie Vaz) and for Stroud (Neil Carmichael) and of many other Members who have spoken today with great pride in their constituencies and also a good sense of humour. I was pleased to learn of the farming background of the hon. Member for Stroud. As someone who grew up on a Norfolk farm, I am aware of some of the significant challenges facing agriculture, and it is good that someone with direct expertise in that area has been elected to this House.

I would like to start by paying tribute to Charles Clarke, the previous Member for Norwich South. Charles brought immense intellectual rigour to debates on policy, both locally and nationally. He worked very hard for his constituents, and while he was serving outside the Cabinet he also built a reputation as someone with real independence of mind, and with great confidence in speaking up when he felt his party was wrong.

Norwich has a tradition of rebellious tendencies. In 1381, it was a focus of the peasants’ revolt; the city gates were forced open and the castle taken by the rebels. Within 200 years, my city experienced another great rebellion: Robert Kett led a three-week uprising against the enclosure of common land. His army seized the city, and defeated a Government army in battle. In 1793, Norwich’s Bell hotel was the meeting place of a secret group hoping to spread French revolutionary ideals.

As I am probably not giving too much reassurance to my party’s Whips about the value of having a representative from Norwich in their ranks, I shall move on to talk about some other issues that affect my constituency. It truly is a great honour and privilege to represent Norwich South. Norwich is a great city in which to live and work. Economically, politically and culturally, it is a very important capital within Norfolk and East Anglia, and we aspire to be, and do, so much more.

However, like the rest of Britain, Norwich faces its own challenges. Top of the list is the need to develop the infrastructure supporting Norwich’s economy. One of the major issues is the need to improve the Norwich to London rail service, which has suffered from under-investment for many decades. As part of the Greater Anglia rail franchise, I want to see a genuine commitment to 90-minute journeys between Norwich and London, more reliable services, newer trains and improvements to capacity. Although new high-speed rail is, of course, to be welcomed, we must not distract attention from such routes, where investment is so desperately needed.

I also want to see the soonest possible completion of the dualling of the A11, a key road link connecting Norwich to London. Following a Government inquiry into this matter earlier this year, we are all now awaiting the inspector’s report. It has been estimated that for every pound required to complete the dualling, the local economy would benefit by £5. It is a very strong and necessary investment, which would give Norwich and Norfolk a much needed boost. The state of the public finances means that there is real pressure on budgets supporting such infrastructure development, but it is vital that those parts of the county that have not had a fair deal in recent years do not lose out now.

Norwich is seeking to become the UK’s first capital of culture, in 2013. My city has a fantastic cultural heritage. I am enthusiastically backing Norwich’s bid, and I urge other Members to join me in doing so by signing up to my early-day motion. This would mean so much to the city of Norwich and the wider region, not only in terms of cultural growth, but through the economic and tourism boost a successful bid would provide. I fear that I probably will not have the backing of the hon. Member for Sheffield Central (Paul Blomfield), however.

My city’s culture and heritage includes a wealth of pubs and churches. Norwich was once famous for having a church for every week of the year, and a pub for every day, with the highest number of watering holes per square mile in the UK. It is also thought that Norwich’s churches were so popular in part due to activities that resulted from the popularity of its pubs.

Norwich is also known for its world-class research in the field of climate change. As a low-lying county with a soft coastline, Norfolk is in many ways at the forefront of climate change in the UK. Many of the UK’s leading climate change experts are based at research institutions in Norwich, including the university of East Anglia and the Norwich research park. This Parliament will prove to be of vital importance to the future of our planet, and the expertise in my constituency can play a vital role.

Another area I am passionate about is education. As a former secondary school teacher, I am committed to seeing that schools get the best deal possible. I am delighted that front-line school funding will be protected, and that the new pupil premium will provide greater support for children from disadvantaged backgrounds.

Norwich is a university city, and my constituency contains the university of East Anglia. Like university students throughout England, its current and potential students are nervous about taking on the level of debt now required to study their chosen degree courses. I am one of an increasing number of MPs who has the misfortune of having a substantial debt to pay off. I passionately believe in the case for free higher education and, until the country can afford to deliver on that, I hope that we can at least work to address the issue of student debt. We also need to widen participation in higher education and increase the number of young people entering it from less well-off backgrounds. Education and aspiration are key to improving social mobility.

Building a better Norwich, or building a better Britain, does not come about simply by dropping Government legislation from a great height and hoping that it will bear fruit. It comes about through working the ground to enable it to bear fruit and working with the people whom it affects in order to harvest their ideas and experiences as to what works and what could be made to work. I am a local representative as well as a parliamentarian, so I know that we must connect the legislative process with our communities. As the Member of Parliament for Norwich South, I will spend the next five years and, I hope, many more thereafter, working with individuals, community groups, the police and council representatives—with everyone who has a stake in the future well-being of my city—to bring about the very best for Norwich. I look forward to working over the years ahead to raise, through Parliament, the concerns and issues expressed by my constituents in Norwich and to working with colleagues from all parties to deliver on the proposals outlined in this debate to the benefit of my community.

21:06

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

Thank you, Mr Deputy Speaker, for allowing me the opportunity to make my maiden speech. I hope to have learned from my experience in local government when making this speech, in that it does not matter what someone says as long as they are brief, because then people will like them. I congratulate everyone who has made their maiden speech this evening, because we have heard wonderful contributions demonstrating real passion for the home territories of hon. Members, and I hope that my speech can do the same.

I wish to start by paying tribute to my predecessor as the MP for Walthamstow, because I know that I have a hard act to follow. In E17, we have a fine tradition of MPs who have embodied the best of my party and the best of our politics, not only in London but nationally. Just like another previous incumbent, Clem Attlee, our MP Neil Gerrard fought tirelessly for the ideals that brought him into political life with independence and with honour. I am reliably told that he is a man who was a Whip’s delight, taking up the causes that others often shied away from. He was a tireless advocate for a better and more humane approach to asylum and immigration, for the need to support action on HIV and AIDS, and for prison reform. He has also been a powerful voice for my home of Walthamstow, and I have been honoured to work with him.

Neil and I have campaigned together for many years on local issues that matter to the future of our area and to the community in which we live. We have called on London & Quadrant Housing Trust not to leave our iconic local dog track derelict for six years and instead to name its price so that we can bring it back into use. We have called on the Universal Church of the Kingdom of God not to leave the beautiful EMD cinema derelict and instead to work with the McGuffin Film and Television Society and local residents so that we can have cinema in Walthamstow. We have fought for more investment in our local Whipps Cross hospital and for local school places. We have stood up for human rights in Sri Lanka, Kashmir and Palestine. The Whips may be horrified to learn that Neil has been an inspiration to me, and I promise in this Chamber to follow his good work for the people of Walthamstow.

I know from my work with the people in Walthamstow that we are not a community short on ambition. We put our money where our mouth is, organising and mobilising for a better future for our families, wherever in the world they may be. Whether we are talking about the Senior Citizens Asian group, our local Somali, Anatolian and Tamil communities, the mum and dads in our Sure Start centres in Lloyd Park, Sybourn or Church Hill, our local toy library, or the many local youth projects with which I am proud to work, including the Active Change Foundation, Pak Cultural Society, the X7eaven Dance Group, the Woodcraft Folk or even the Scouts, Walthamstow is full of people with ideas and dreams about what they want to do and with the passion and commitment to each other to work together to achieve it.

Indeed, I contend that because Walthamstow has always been full of people like that, our area has played a key and yet too often unacknowledged part in shaping the lives of everyone in this Chamber. I want to try to change that this evening. Hon. Members may not be aware that Walthamstow and the Lea valley were the original base of British aviation and motoring. Our area also has a proud history in the creative industries, which ranges from its being part of the original British film industry and having Turner prize winners as residents, to holding on to William Morris and even the grime music scene. We lay claim to helping put a man on the moon, to England football team greats, through David Beckham, to even the kinder Conservatives, through Disraeli, and to the best of British rock, through Ian Drury and the Rolling Stones. I am proud to share with Keith Richards’ grandmother the honour of having served as mayor of Waltham Forest.

Yet for all that we have contributed to this country, we in Walthamstow know that we still live in a world in which too often it is where someone lives, rather than what they are, that defines whether they have the opportunity to realise their potential. I am so proud to represent Walthamstow, and therefore so determined that that situation must change. I know that it is worth our while. If we can unlock the talent of Walthamstow’s residents, Britain will benefit even more than it has done already from the creativity of previous generations. That is why I wanted to speak in today’s debate and why I want to draw the Government’s attention to how their education plans will hinder, not help, young people in places such as Walthamstow.

Following on from what the Secretary of State said, I want to prick the Government’s conscience: if they can find the money for marriage, they can find the money for the programmes that actually work for our families. Political leadership is about the ability to think long term. I urge the new Administration to rethink their proposals for child trust funds, and instead to recognise the investment in the future that this scheme represents. For the 8,000 young people in Walthamstow who have one, they offer the kind of opportunity that too many in previous generations have been denied. They are a launch pad for a leap into further and higher education; the start of funding for a down payment on a house; or money to help pay for training or start a business. Do not listen to me; listen to the 30% of poorer families topping up their child trust funds as we speak.

The same could be said of the future jobs fund. For many young people in Walthamstow this has been a lifeline, getting them into employment and on to the first steps of their career ladder. They are not the young people who have the networks and connections that mean that success is assured, but they have grabbed with both hands the start that this scheme offers. I also urge Ministers: if they say they care about social mobility, they should rethink their planned cuts for universities. I can attest that it is in places such as Walthamstow that those kinds of policies, over the past 13 years, have transformed the life chances of young people.

When the previous Government started to increase the number of places available in higher education, Walthamstow’s children took the opportunity it represented. In the past 13 years, the numbers of young people from my constituency going to university have rocketed by 87%, and the evidence shows that they are the children from poorer backgrounds. Our young people in Walthamstow do not lack ability. We have the top-performing economics department in the country, at Sir George Monoux college, and we have pupils who have benefited from the Building Schools for the Future fund, in schools such as Walthamstow School for Girls and Frederick Bremer school, and we are concerned about what will happen if we hang the axe over projects such as the one for Willowfield school in Walthamstow, because we see the difference that such investment makes.

I urge the Government to ensure that they will guarantee the Building Schools for the Future funds that have already been committed. Above all, this programme shows that these things happen not by accident, but by design. The Labour party understands that when we invest in the future of every young person in Britain, wherever they live, we all benefit. That is why I give notice to those on the Government Benches: on behalf of the people of Walthamstow and their families, I intend to fight for every place, every opportunity and every chance that my community wants and deserves; to challenge the Government’s proposals that will mean a bleaker, not a brighter, future for them; to use my place in the House to be a voice for those who will be forgotten by the Government’s proposals; and to argue that there is not simply opposition to the Government, but an alternative. The potential that we have in Walthamstow to contribute to the future prosperity of this country demands nothing less.

21:13

[Gordon Henderson (Sittingbourne and Sheppey) (Con)]

Mr Deputy Speaker, thank you for letting me make my maiden speech this evening. I congratulate all the other hon. Members who have made their first speeches today, particularly my hon. Friend the Member for Blackpool North and Cleveleys (Paul Maynard), whose speech was quite inspirational.

I feel honoured and privileged to have been sent by the people of Sittingbourne and Sheppey to represent them here in Parliament. They have placed on my shoulders a great responsibility, and it is a responsibility that I take very seriously. I know my immediate predecessor, Derek Wyatt, felt the same way, and I would like to pay tribute to him for his dedicated service to our community over the past 13 years. Of course, like many other political opponents, we locked horns on a number of occasions, and the 2005 general election was a real ding-dong battle that ended with me winning by 118 votes —or so I thought. Understandably, Derek asked for a recount, and hon. Members can imagine my disappointment, and his relief, when the result changed to a 79-vote victory for him. Part of me was disappointed when Derek decided not to seek re-election this time because I wanted to beat him fair and square without the need for recounts, but another part of me was pretty relieved, because he was well liked and well respected in my constituency and if he had been the Labour opponent, it would have been far more difficult for me to convert that 79-vote deficit into what was eventually a majority of 12,383.

Life moves on. I am now the MP for Sittingbourne and Sheppey, and standing in this Chamber today is the culmination of a lifelong dream. I come from a humble background. I grew up on a council estate, went to state schools and, like many of my generation, left school at 16. For boys from the Fort Luton secondary modern school in Chatham, there were few employment options. It was pretty well expected that we would become apprentices in the dock yard, go to work in the oil refinery on the Isle of Grain or join the armed forces. Going to university was something that we could only dream about—particularly someone like me who failed the 11-plus.

Despite having had a less than classic education, my generation of working-class children was taught to love our country, honour its traditions, obey its laws and respect its institutions, particularly Parliament, which is the very heart of our democracy. I have been concerned by the way in which respect for Parliament has diminished in recent years and I am determined to play my part in helping to restore its somewhat battered reputation. I will do my best to uphold the best traditions of Parliament and I will never knowingly bring it into disrepute. That is my pledge to the House and to the people of Sittingbourne and Sheppey.

I want to be a true parliamentarian, holding the Executive to account and representing without fear or favour those who sent me here. Those people—my constituents—are special people, and Sittingbourne and Sheppey is a special constituency that I am very lucky to represent. For those who do not know, it is situated on the north Kent coast and is one of the most unique and diverse constituencies in the country. I know that we all say that, but in my case it is true. We have a port that has the deepest water outside of Rotterdam and we have one of the few steelworks in the south of England. We have three prisons, which is pretty unique in itself. We have a seaside community and a rural, farming community with both livestock and fruit farmers. Some 40% of our population lives on an island, which is also unusual in England. We have 24 town and parish councils and three large, unparished urban areas.

Each of those communities has uniquely different problems and concerns, and I will be dedicating myself to highlighting some of those concerns in the coming months and years. Today, I would like to start by addressing an issue that is relevant to the Academies Bill. Two years ago, one of the secondary schools in my constituency, Westlands school, received an outstanding Ofsted report. So good was the report that the head and his senior staff were seconded to help to improve standards in a number of other schools in Kent. More recently, Westlands decided to form a federation with a struggling local primary school so that it could help that school to drive up standards. I am sure that hon. Members on both sides of the House would agree that that this is just the kind of initiative that we should welcome. But the staff and governors at Westlands are even more ambitious than that. To make their school even better, they are keen to become an academy. They have already made inquiries about obtaining academy status, but have been told that their bid would not succeed because they are in a federation with a school that was deemed to have been struggling. It seems that a key test for approving academy status is that the applicant school is “outstanding”.

I have no problem with that criterion, except that it effectively prevents federated schools from gaining academy status unless both schools are “outstanding”. That seems a particularly perverse rule when one considers that one of the objects of the Academies Bill is to give schools

“the freedoms and flexibility they need to continue to drive up standards”.

I very much hope, when the new Academies Bill is drafted, that that rule can be amended to make an exception for outstanding schools like Westlands which, for the best of intentions, have linked up with a less successful school. That would make a great deal of sense if we are genuine about driving up standards in all our schools.

In conclusion, let me explain briefly what motivates me. One of our regional newspapers published recently a short biography of all the new Kent MPs. Each piece finished with what might be a dream job for that MP. The jobs ranged from Sports Minister through to Prime Minister. My dream job was listed as being the Member of Parliament for Sittingbourne and Sheppey. That pretty well sums me up, because being able to represent a community that I love here in Parliament is actually what motivates me.

21:21

[Owen Smith (Pontypridd) (Lab)]

Thank you very much, Mr. Deputy Speaker, for calling me to make my maiden speech this evening. I would like to congratulate the hon. Member for Sittingbourne and Sheppey (Gordon Henderson) warmly on his maiden speech. I share his passion and conviction in wanting to represent my constituents. He is right to say that doing that is a very great honour for all of us, and it is one that I hope to carry out to the best of my ability.

I should also like to congratulate all the other new Members who have made their maiden speeches today. I have listened to most of them—it has been a long day—and I think that many of them spoke with great conviction. They have been extremely accomplished, and I congratulate them on opening their accounts.

My predecessor as the Member for Pontypridd was of course Dr Kim Howells. Kim first entered the House in a by-election in 1989, and he served with what can only be called great flair and passion for over 21 years. His broad experience and interests—his hinterland, so to speak—allowed him to serve with great distinction in a wide range of Departments. At the Department for Trade and Industry and the Department for Culture, Media and Sport, and as Minister for Higher Education, he spoke fluently and fearlessly to Members and media alike—so fearlessly on occasion, in fact, that many of us who know him well were deeply worried when we learned that he was going to be announced as the new Minister for the Middle East. However, Kim of course carried off that portfolio, like all of the others, with great panache, charm and purpose, as he did his role as Chairman of the Intelligence and Security Committee when he returned to these Back Benches. I know that he will be greatly missed in this House and in my constituency, his former constituency. I wish him well, and I am sure that many others in the House will join me in doing so.

For my own part, I intend to carry on Kim’s tradition of speaking without fear or favour on behalf of the constituents of Pontypridd, addressing the issues that matter to them and serving them by articulating their concerns both in and outside this great Chamber. I will do so with passion, and a conviction that I think comes easiest to those of us in this House who are lucky enough to represent the towns that made them. As a man of Pontypridd once naively hopeful of achieving the highest accolade his town might bestow on him—playing for the first XV at Sardis road, of course—I have no qualms in stating that standing here today is almost as proud a moment as it would have been to pull on the black and white jersey of Ponty.

I am sure that hon. Friends from neighbouring constituencies will forgive me for saying that Pontypridd is an iconic valleys seat. From the town of Pontypridd, bisected as it is by that most Welsh of waterways, the Taff, whose once coal-black eddies mix now with the Rhondda in the great park of Ynysyngharad, through to the former mining towns and villages of Beddau, Tynant and Tonyrefail in the north, to the farmland turned commuter communities of Pontyclun, Miskin and Efail Isaf in the south, it is modern south Wales in microcosm. Its past is also a near-perfect reflection of south Wales history. Ponty grew from village to market town, then county town, on the profits from coal. The rush for black gold in the 19th and early 20th century forged great architecture, culture, character and a frontier town attitude that would have been recognised in Abilene or Dodge City in the same era.

That period left us with our famous bridge, once the widest single span crossing in the world, and another by Brunel; a train station built to accommodate the great caravans of coal trucks, also at one point the longest in the world; boxing champions like Freddie Welsh, singers from the bass baritone of Geraint Evans to the Treforest tenor of Tom Jones, and rugby stars by the dozen—Glyn Davies, Russell Robins, Neil Jenkins, Martin Williams, Gethin Jenkins; the list is endless.

Pontypridd’s present, too, mirrors post-industrial Wales: greener, cleaner, healthier and wealthier now, thanks to Labour investment. There is a new hospital, four new schools, a massive increase in quality housing and home ownership, and now a £40 million learning campus soon to be opened in Nantgarw, just one current testament to our ambition, the aspiration of our people and our faith in them.

However, questions remain about the future of Pontypridd. Though the last decade has seen my constituency, and others like it, start to close the gap in health, wealth and opportunity between them and more affluent parts of Britain, the distance is still unacceptably wide. It can be closed, in part, with effort and aspiration, but it requires sustained investment too, and although we live in much straitened economic times, principles of social justice and economic equity dictate that, whichever Government are in power, we must recognise the need to shrink that gap further.

That is why I chose to make my maiden speech during this important debate on health and education, because although a devolved Wales may be insulated, in part, from the policies currently proposed by the Tory coalition, other actions already undertaken will have a long-term impact on the ability of my constituents to improve their health and educational achievement. In particular, I refer to the so-called efficiency savings that the Government are achieving through abolishing the future jobs fund and axing the baby bonds, policies that were proving popular and effective in my constituency.

As a Welsh MP in a British Parliament, I make no apology for addressing the substance of the Government’s proposed education Bill, which appears to subvert entirely the original intention of the academy system, transferring freedoms that were accorded as a specific stimulus to schools in challenging circumstances and with diverse intakes, and affording them instead to already successful schools, allowing them to float free from democratic and local control.

As for the notion of free schools modelled on their Swedish equivalents or US charter schools, I urge those on the Government Front Bench to examine the evidence anew. Already today we have heard that state education authorities in Sweden have decidedly mixed views about the track records and the segregating impact of the free schools there. From America, there is already a growing body of evidence that leading educationists such as Diane Ravitch are railing against them. She described them recently as a “free market construct” designed by

“right wing think-tanks for the purpose of destroying public education and the teachers’ unions”.

In that one phrase the true agenda of the new right-wing coalition Government shines through, and it is a vision that I and others on the Opposition Benches will oppose with vigour and conviction.

I have had a lot of advice since arriving here as a new MP, all of it well meaning and most of it entirely contradictory—speak early and make a name for yourself, or bide your time for a decade or two; frequent the Tea Room with regularity, or shun it like the plague; never show weakness to the Whips, and never cross them either. I would like to thank all the honourable and venerable Members for these pearls of wisdom. However, I believe the best advice I have taken was not delivered first hand, but in the pages of a newspaper by the former deputy leader of the Labour party, Roy Hattersley.

Lord Hattersley stated that

“it is belief that sustains MPs through the unavoidable days of doubt and disappointment.”

I am not sure about the next bit, as he went on:

“The pay is … moderate. The conditions, though improved, are still inadequate. The status is equivalent to that enjoyed by snake-oil salesmen. Without clear convictions, life at Westminster is a boring waste of time. With them, it is a great and glorious adventure.”

I have my beliefs and my convictions, and I intend to hang on to them. I intend my time in this place to be a “great and glorious adventure,” at the end of which I will have made real improvements to the lives of people in Pontypridd.

21:29

[Andy Burnham (Leigh) (Lab)]

What a great note on which to end. We are sure that will come to pass.

I begin by congratulating the Secretaries of State for Health and Education on their new positions. I also welcome back to the Department of Health the hon. Member for Chelmsford (Mr Burns), who left it in 1997. I trust that he finds the NHS in much better shape than he left it all those years ago. Whatever policy differences we may have, I do not think that any Opposition Member would doubt the conviction or the depth of knowledge with which both Secretaries of State speak in their new roles. The two Departments that they now lead have established impressive collaborative working in recent years, particularly on children’s health, on promoting children’s activity and on child safeguarding, and I hope that I can begin on a non-partisan note by encouraging them to build on that track record. My right hon. Friend the Member for Morley and Outwood (Ed Balls) and I rarely missed an opportunity to promote joint working between our two Departments, although we can probably both admit now that jumping on a rope swing was, in retrospect, a promotional step too far.

[Ed Balls]

I enjoyed it.

[Andy Burnham]

I beg to differ.

We heard from another former Secretary of State today, praising Labour’s investment in the NHS—the right hon. Member for Charnwood (Mr Dorrell). When the Education Secretary spoke, he really laid bare the difference between the two sides of the House. He boasted of the funding settlement that he had secured for this year, but under questioning from my right hon. Friend, he could not answer tell us about future years. Nor could he say whether it extended to 11-year-olds and beyond.

The big difference between us is that we on the Opposition Benches recognise that improving the health of the nation depends on investing in far more than the NHS. It involves investing properly in local government and in our schools to ensure that we have public services that are able and equipped to work together. The Government have made their commitment to increase health spending in every year of this Parliament at the expense of other crucial budgets on which the NHS depends. It is a judgment that has more to do with political positioning than with sound and good policy making, and they will come to regret it.

It is important for me, on behalf of all Opposition Members, to put something on the official record at the start of this Parliament. Labour has left the NHS in its strongest ever position. That is a fact, and no attempt by the Government to rewrite history will change that. The NHS is substantially rebuilt and renewed. It has an expanded, skilled and fairly rewarded work force, able to meet the expectations that today’s patients have. Waiting times are at an all-time low and infection rates are right down; consequently, patient satisfaction with the NHS is at an all-time high. That did not happen by chance. It happened because of decisions taken by Labour Members in the teeth of opposition from the new Secretary of State and Conservative Members. Because we took those tough decisions, we have left the NHS in that position. We shall be watching the Government’s decisions closely to ensure that the NHS continues to move forward in this period.

I have never doubted the right hon. Gentleman’s commitment to the NHS, but I am less sure about the people behind him and around him. Last August, a ComRes survey of prospective Tory parliamentary candidates found that an amazing 62% disagreed with their Front-Bench policy to increase NHS spending in real terms during the course of this Parliament. [Interruption.] I do not know whether the hon. Member for Totnes (Dr Wollaston) was one of the respondents to that survey, but it was an amazing statistic that so many people could not agree with the policy that Conservative Front-Bench Members were putting forward. We have not heard from them today, but I suspect that there are a few more members of the Daniel Hannan tendency on the Government Benches. I am sure that we will come to know and love them as the weeks and months go by.

With apologies to some of the older hands in the House, in the time remaining I would like to concentrate on some of the 23 maiden speeches today. All hon. Members spoke with great authenticity, and it is refreshing for Members who have been in the House for some time to hear such speeches made with real sincerity and passion, and before people learn the tricks and artifices of this place which we all know so well.

Let me mention some of those speeches. The hon. Member for Harlow (Robert Halfon) spoke of his ancestors advising Henry VIII on divorce, and the thought crossed my mind that the family’s skills might be of some use if the fabled married men’s allowance ever reaches the Floor of the House. We had a second maiden speech from my hon. Friend the new Member for Liverpool, West Derby (Stephen Twigg). I have just been out to check, and I can assure the House that the second was much better than the first—[Laughter]—but the first was quite good as well, actually. He made mention of the wonderful, international institution that is Alder Hey hospital, and all Members, not just north-west MPs, look forward to its successful rebuild in the coming years. It really is a true, national jewel in the crown, and we look forward to seeing that scheme make progress.

The hon. Member for Chippenham (Duncan Hames) praised the beauty of his constituency, and it is indeed a wonderful part of the world. My hon. Friend the Member for Luton South (Gavin Shuker) praised the huge change that took place in his constituency after Labour came to power and, particularly, the progress that the university of Bedfordshire has made. Perhaps others have said this to him since his wonderful victory, but I was musing on the idea that his victory speech was the shortest ever given at a count, with just the words: “That’s life.” I am sure that that was the speech. It did not need to be much more than that.

The hon. Member for Totnes is a very welcome addition to the House. We have lost a GP in Howard Stoate, whom Opposition Members will remember very fondly, but the hon. Lady brings back to the House the experience and voice of a general practitioner. She brings also some experience of wider public involvement in the political process, which is a good thing, too, and she spoke very knowledgeably about the real problem and threat that alcohol misuse poses to our society.

My hon. Friend the Member for Wolverhampton North East (Emma Reynolds) rightly praised Ken Purchase, who made a distinguished contribution over many years in this House, not least in securing the redevelopment of Wolverhampton’s New Cross hospital. My hon. Friend said that she hoped to follow in the proud tradition of women MPs who have come from the area, particularly Renée Short and Jennie Lee, and I am sure that she will keep up that fine tradition.

The hon. Member for Bristol North West (Charlotte Leslie) made a very fair-minded and good maiden speech, talking of the need to improve educational opportunities for all. She praised her predecessor, Doug Naysmith, who was also very warmly regarded by Opposition Members and, I am sure, by Members from all parts of the House for his crucial work on the Health Committee and on mental health.

The hon. Member for Croydon Central (Gavin Barwell) made a very strong maiden speech. “Croydon born and bred,” he said, and he talked about the town’s image problem. However, on that outing he has already done his bit to reverse that idea and is already an excellent ambassador for his home town.

My hon. Friend the Member for Streatham (Mr Umunna) gave a very insightful and measured speech. Again, born and bred in his constituency, he spoke knowledgeably of the casino culture in the City and of the gap between rich and poor. It is still too wide, and Opposition Members will renew our efforts to narrow that gap. He talked also of the former Member for Streatham surfing in Cornwall as we met here today, and I think we could all hear his trademark laugh echoing around the House as we imagined that scene.

We then had a very rare moment in the House: a most impressive and incredible maiden speech. The hon. Member for Blackpool North and Cleveleys (Paul Maynard) followed his leader in speaking without notes, and as he can see not all of us can manage to do that, even after nine years in the House. However, he gave a most confident speech, mentioning that he is the first former pupil of a special school to take a seat in the House and, indeed, the first Member with cerebral palsy. He made a huge contribution this evening and a huge impression, and nobody could fail to be moved by it. We all want to hope that people can fulfil their ambitions, whatever difficulties they face in life, and he will make a distinguished contribution in the years to come. His praise for Joan Humble was very well received by Opposition Members, and I do not know whether he makes any connection between Blackpool’s recent promotion to the premier league and his recent election as Member for the town, or indeed whether it is too early to make such a claim, but Everton look forward to picking up six points when the new season begins.

My hon. Friend the Member for Kilmarnock and Loudoun (Cathy Jamieson) spoke passionately about the importance of co-operative values and she was right to do so. In the age that we live in, the public are looking for organisations that embody something different and give the public something that they can trust. She made that important point well. My hon. Friend also mentioned Des Browne, whom we all remember well. He made a huge contribution to public life and will continue to do so in another place.

The hon. Member for Stroud (Neil Carmichael) praised David Drew; I believe that the hon. Gentleman comes from his constituency and is well known there. My hon. Friend the Member for Liverpool, Wavertree (Luciana Berger) made an important point, and I ask the Secretary of State for Health to consider it. She spoke of the important need to rebuild the Royal Liverpool hospital. The right hon. Gentleman will remember that I approved that decision not long before leaving the Department of Health. There can be no question but that the hospital redevelopment is essential for the city of Liverpool. It is not only the hospital trust that is involved; there is also a partnership between the university of Liverpool and the pharmaceutical industry. The hospital desperately needs to be replaced and I hope that the right hon. Gentleman will encourage the decision back out of the Treasury and allow it to proceed quickly. The scheme is much needed to improve the health service on Merseyside.

The hon. Member for Bradford East (Mr Ward) stressed the significant effect of deprivation on a whole host of factors, including life chances. We may feel that he is more in sympathy with us than with his new friends on the Conservative Benches. My neighbour and hon. Friend the Member for Wigan (Lisa Nandy) made an excellent speech praising my good friend Neil Turner. She mentioned the importance of rugby league in our borough and rightly said that our borough is only now recovering from the effects of the recession of the ’80s and ’90s. That is why it is so crucial that the Government should continue to help the North West Development Agency and others to develop the jobs of the future in boroughs such as Wigan. We will hold the Government to account for the decisions that they take on that.

The hon. Member for South Derbyshire (Heather Wheeler) spoke of the importance of Toyota to the Derbyshire area and I am sure that she was right to do so. My hon. Friend the Member for Sheffield Central (Paul Blomfield) paid tribute to another good friend, Richard Caborn, who will be remembered most as a very distinguished Minister for Sport. My hon. Friend also reminded the House of something that we may want to file away and come back to a few times before the next general election—how his neighbour, the right hon. Member for Sheffield, Hallam (Mr Clegg), now Deputy Prime Minister, was wandering around his constituency right until polling day warning people that they should vote Lib Dem if they did not want the Tories. We need to remind the right hon. Gentleman of that.

The hon. Member for Tamworth (Christopher Pincher) praised Brian Jenkins, who made a distinguished contribution to the House, and my hon. Friend the Member for Walsall South (Valerie Vaz) made a distinguished speech. Finally, she is in this House in her own right, and she is very welcome. She will make a huge contribution. The hon. Member for Norwich South (Simon Wright) paid tribute to Charles Clarke in a distinguished speech.

There was a spirited and passionate speech about Walthamstow from my hon. Friend the Member for Walthamstow (Stella Creasy). I do not know whether, as a former Health Secretary, I can admit to having been to the dog track there, but I have. It was a wonderful place and we need to ensure that she fulfils her ambitions for her constituency. She made a wonderful speech. The hon. Member for Sittingbourne and Sheppey (Gordon Henderson) spoke passionately about the fulfilment of his dream. Finally, I turn to my hon. Friend the Member for Pontypridd (Owen Smith). We could not give him the black and white of Ponty rugby football club, but we have given him the green Benches. We hope that they are good enough. His first speech shows that he will have a great career in this place.

In the time that I have left, I want to tell the Health Secretary that we will come back time and again in this Parliament to the commitments that he made during the general election campaign to remove NHS targets. That is the biggest difference between us. I am picking up whispers that, having spoken to the civil servants in the Department, he is having second thoughts and thinks that that is not such a good idea after all. That was the whisper in the trade press. However, this afternoon at the Dispatch Box, the Prime Minister said that the targets would be going. Let me tell the Health Secretary directly that if those targets are removed from the national health service, people everywhere who depend on a good service from the NHS will no longer be able to count on that. Those standards, which Labour introduced, have given us a national health service that provides a good standard of care to people right across the country. They are good standards to have in a national health service.

The Secretary of State needs to come clean at the Dispatch Box. Is he going to back up those standards, or does he have something else in mind? Is he going to keep the 18-week target, the two-week target for cancer, and the four-hour A and E target? He needs to give a direct answer. If he is not going to do that, he will leave lots of people without the peace of mind that they need and that tells them the NHS will be there for them when they need it. I can tell him that if he removes those standards in a time of financial pressure in the NHS, then as sure as night follows day, waiting lists and waiting times will begin to increase, and Labour Members will hold him and his colleagues responsible for that. We have given the warnings. We do not want to see the progress made in the NHS lost in the months and years ahead, and we will hold him to ensuring that commitments given will be honoured. He said that he will take the NHS forward, and we will ensure that that is indeed what he delivers.

If the Secretary of State makes those changes and leaves people without the peace of mind that they need from the NHS, and if the Education Secretary and the Business Secretary go ahead and take away people’s life chances by restricting access to university and the future jobs fund, it will not be a case of, “We’re all in this together”, but of leaving people who have least and are in a much deeper hole than the others without the security and peace of mind that they need from a strong NHS and, for young people looking for a job, the ladder to get up to a better life. We will hold this Cabinet to account for those decisions, and we will ensure that the excellent progress that we have made is not threatened or jeopardised by this Government.

21:46

[The Secretary of State for Health (Mr Andrew Lansley)]

It is a great privilege to be able to come to this Dispatch Box for the first time as Secretary of State for Health, after six and a half years as shadow Secretary of State. I thank the right hon. Member for Leigh (Andy Burnham) for his kind words about me and my team. I am very proud of the team that we have at the Department of Health. I was proud when the Prime Minister spoke of us in warm terms today, and we will fulfil the responsibilities that he has placed on us.

Let me say to the right hon. Gentleman, in return, that I thank him, on behalf of the NHS, for his commitment. From the days when he began as a Minister in the Department and then went, as it were, back to the shop floor, I think that nobody has doubted his personal commitment to improving standards in the NHS, nor, indeed, that of his outgoing ministerial team. He is on his own in the shadow health team—[Interruption.] Oh, I beg their pardons. However, he has lost his fellow Ministers. I will not go on at length, but I know that they were all committed to their jobs. I want especially to mention Ann Keen. As a nurse, she showed her personal commitment to the NHS and to nursing as a profession. My colleagues, including the Under-Secretary of State for Health, my hon. Friend the Member for Guildford (Anne Milton), and I will ensure that we continue the work of identifying how we can take nursing forward as a profession. That includes the work that she and the Minister of State, Department of Health, my hon. Friend the Member for Chelmsford (Mr Burns), have done in looking at nursing as a profession for the future.

As Secretary of State, it is my privilege to be able to represent those who work in the national health service. We have reason, all of us, to be grateful to them every day. People in Cumbria, especially today, have reason to be grateful to the north-west ambulance service, to local GPs, and to those who work in North Cumbria University Hospitals NHS Trust, particularly those at West Cumberland hospital, whom I have twice visited. I know the responsibility that they feel, even on a day-to-day basis, for providing hospital care—acute care—to patients across that part of Cumberland, which is at a great distance from other hospital locations. I know that people in Cumbria will be deeply grateful for the service that they have provided to look after them today.

It is a privilege for the shadow Secretary of State and I to respond to this debate, which has included 23 maiden speeches and, indeed, some fine speeches by Members who are not new. Before I respond to those speeches in detail, I want to say that it was very encouraging to hear the commitment to improving quality expressed on both sides of the House.

It was particularly encouraging to hear my right hon. Friend the Secretary of State for Education and other Members on these Benches demonstrate that what we need to achieve that quality is a change from a command-and-control, top-down system of running our schools, hospitals, health care and social care services to one that is built on standards of delivering quality. We need to understand that if we are really going to achieve that, we have to give parents greater choice and control over the education that their children receive. We have to give patients greater information, choice and control over the health care that they receive, and in all the public services that we are talking about, we must provide those who deliver them with a much greater sense of ownership.

It is all very well for the right hon. Member for Leigh to talk about what has been achieved in the NHS over recent years, and I have never been one to diminish what has been achieved. However, many who work in the service, notwithstanding the fact that they are better paid than they were and know that they have had an unprecedented increase in resources to deliver improvements, still feel demoralised and that they are not in control of the service that they provide. They cannot give the care that they want to give, and they know that they are not yet matching the standard of care that they could achieve given the opportunity to do so. It is our responsibility to make that happen and I do not doubt the commitment of Government Members to do so. I visited 62 constituencies during the general election campaign and, without exception, I met candidates who were committed to delivering improvements in health care, not least because in many cases they had personally campaigned for years to deliver improvements in health care services. That is why we will not let Labour’s debt crisis, which we have inherited, mean that we cut the NHS and make the sick pay.

When the right hon. Gentleman was Secretary of State, he commissioned McKinsey to go off and publish a report. It produced a report for him stating that on average, something like 10% of those employed by a provider of health care with 300 staff should be taken away, mostly clinical staff. That was the recommendation given this March to my predecessor as Secretary of State, but that is not the way we should go. We must move towards a change in priorities from a service that was increasing the number of managers three times as fast as the number of nurses to one that deploys clinical staff on the front line to deliver the care that patients need.

[Andy Burnham]

Just for the record, the report was not commissioned by me or by Ministers but by the former director of commissioning in the Department, who left before I arrived.

[Mr Lansley]

Let me put it like this: I inherited a Department in which the report had been produced but not published, so I published it. I published the report on London and will publish all the reports that were prepared before the election, such as the prescription charges review that the Secretary of State commissioned from Professor Ian Gilmore, which was not published before the general election. As far as I am concerned, we are committed to transparency and getting that information out.

I have immense respect for the right hon. Member for Rother Valley (Mr Barron). He and I do not agree about the specific issue of minimum unit pricing on alcohol, and he knows why—I do not believe we have seen the evidence of its benefit compared with cost, particularly for low-income households. However, my hon. Friend the Member for Totnes (Dr Wollaston) is absolutely right that we must do something about the matter. We must acknowledge the scale and severity of the problems resulting from alcohol misuse, and we must tackle supply, pricing and problem drinks. We must ensure that we enforce legislation properly, but we must also recognise that it is not just about restricting the availability of alcohol. We must change our relationship with alcohol as individuals and as a society, and we will address that issue.

My hon. Friend the Member for Milton Keynes North (Mark Lancaster) knows that I am committed to maternity services there and to helping them deliver the quality that his constituents expect. The hon. Member for Hackney South and Shoreditch (Meg Hillier) said that what works in Surrey Heath may not work in Hackney. Exactly—that is the point. When we devolve decision making inside the education and health services, as we intend to do, things happen differently in different places. That is precisely why those services should be empowered to respond in different ways in different places, and that is our intention.

There have been some fabulous maiden speeches today. I say to my hon. Friend the Member for Harlow (Robert Halfon) that I appreciate the 10 years that he has been fighting for the people of Harlow. He showed today his absolute commitment to maintaining exactly that support for the people whom he represents.

It is good to see the hon. Member for Liverpool, West Derby (Stephen Twigg) back, and to those of us who entered the House at the same time as him, it feels as though he had not gone away. I understand exactly what he says about Alder Hey, and the same is true of Broadgreen. I visited Alder Hey shortly before the election, and it tells us a lot when families are crammed together on a ward, but all they want to do is say how wonderful the care that they are receiving is. However, we have a responsibility to ensure that terrific care is provided in physical circumstances that reflect it. We cannot make announcements about the Royal Liverpool and Broadgreen, or about Monitor in relation in Alder Hey as a foundation trust, but I hope that we will be able to do so soon.

The hon. Member for Chippenham (Duncan Hames) and others talked about the importance of community hospitals. I hope that he will have heard the Prime Minister say this afternoon that they are supported and valued. That is absolutely the case, and I know Chippenham hospital from visiting it in the past. The hon. Member for Luton South (Gavin Shuker) said that there is more to life than politics. That is very wise, very true and very good advice for those in the Labour party at the moment. The hon. Member for Wolverhampton North East (Emma Reynolds) has obviously learnt her politics well, because she mentioned the Express & Star, which is very sensible. She also talked about New Cross hospital, which I have visited, as she will know.

We must provide the public with the information required to enable them to support the driving up of standards through the exercise of control and choice, but also sometimes just through holding people to account publicly for the quality of the service that they provide. New Cross is a great example: there has not been a case of MRSA there since June 2009. That is terrific. The former Secretary of State will say, “Haven’t we done well in reducing infections?” However, that is from a terribly high base. What will drive down infections is a constant focus on places that achieve the best results, and New Cross—as I know from personal experience—does extraordinarily well.

My hon. Friend the Member for Bristol North West (Charlotte Leslie) and others talked about the pupil premium and the health premium, how we can reduce health and education inequalities and how we can achieve a greater sense of equality in our society. Notwithstanding some of the correct arguments about the wider social determinants of health and education, if we tackle both as communities and as a society, we can do a great deal to reduce those underlying inequalities at the same time as we tackle economic inequality.

My hon. Friend the Member for Croydon Central (Gavin Barwell) and I go back a long way—20 years—and it was a delight to hear him talking about Croydon and, in particular, about leadership, because that is important. Many other hon. Members also talked about that issue, and rightly so. I heard no references to traffic lights from the hon. Member for Streatham (Mr Umunna), but I used to live in Balham and it was a delight to learn more about the area. I never knew that I was walking the longest high street in western Europe. The hon. Member for Liverpool, Wavertree (Luciana Berger) managed to tell us about the world’s first integrated sewer system and Meccano, so the debate this evening has been very educational.

I do not want to leave anybody out, and I was delighted to hear the hon. Member for Kilmarnock and Loudoun (Cathy Jamieson), who talked about mutualism and social enterprise, which are terrifically important. We will do more to give employers in public services ownership of the services that they provide. The hon. Member for Bradford East (Mr Ward) will know that examples such as Born in Bradford will be part of how we approach our public health strategies. Everyone seemed to mention academies this evening, but my hon. Friend the Member for South Derbyshire (Heather Wheeler) was the only one to mention a golf academy.

My hon. Friend the Member for Blackpool North and Cleveleys (Paul Maynard) made the important point that we must deliver improving long-term care that allies health and social care together. We will do that and we will reform adult social care—and we will not wait until 2015-16 as proposed. We will press on and examine how we can do that in a matter of months, not of years.

The hon. Members for Norwich South (Simon Wright) and for Walthamstow (Stella Creasy) gave us further visions of how they will achieve their objectives for their constituencies, as did my hon. Friend the Member for Sittingbourne and Sheppey (Gordon Henderson) and the hon. Member for Pontypridd (Owen Smith). They are robust advocates in speaking up for their constituencies and explaining their convictions.

In conclusion, I am committed, as is my right hon. Friend the Secretary of State for Education, to putting in place sustainable, stable reforms that achieve our vision of delivering health and educational outcomes that are as good as anywhere in the world, based on principles of equity, excellence and delivering greater efficiency in the services that we represent, but most of all based on empowerment of people.

22:00

The debate stood adjourned (Standing Order No. 9(3)).

Ordered, That the debate be resumed tomorrow.

Integrated Health Care

Wednesday 2nd June 2010 Commons Chamber

Motion made, and Question proposed, That this House do now adjourn.—(Miss Chloe Smith.)

22:00

[David Tredinnick (Bosworth) (Con)]

I count myself lucky to have secured this debate on the day that we have debated health matters in the Queen’s Speech, and to discuss integrated health care for the first time in this Parliament. I am fortunate to be—[Interruption.]

[Mr Speaker]

Order. I apologise for interrupting the hon. Gentleman. This has been a stimulating and, for many, a rewarding day, but if Members who are leaving the Chamber could please do so quickly and quietly, the House will benefit from the words of the hon. Gentleman.

[David Tredinnick]

I am flattered to have the Secretary of State for Health on the Front Bench, the shadow Secretary of State for Health on the Opposition Front Bench and, to my left, a former Secretary of State for Health, my right hon. Friend the Member for Charnwood (Mr Dorrell). It is perhaps pertinent that it was him—then the Member for Loughborough—who, as an Under-Secretary, first made it possible for GPs to refer patients to practitioners who were regarded as complementary and alternative, if they took clinical responsibility. That was the Conservative policy that he instituted way back in 1990.

This debate fits so well with my right hon. Friend the Secretary of State’s determination that, in the words of Queen’s Speech,

“The voice of patients and the role of doctors will be strengthened”.—[Official Report, 25 May 2010; Vol. 510, c. 31.]

This evening I would like principally to address three related issues: the situation regarding homeopathy and homeopathic hospitals; the regulation of herbal medicine and acupuncture; and the consideration of other available models, particularly in Australia and the United States.

Let me start by welcoming my hon. Friend the Under-Secretary to her place. In a sense, this was an integrated health care general election, because the arch-opponent of anything to do with non-orthodox medicine, the former Member for Oxford West and Abingdon, was defeated and the gentleman who stood against me on an anti-alternative medicine ticket lost his deposit. That was because people are increasingly in favour of having alternatives in the health service. Indeed, 50% of the population have at some stage tried one form of integrated health care or another—acupuncture, herbal medicine or homeopathy—or a back treatment.

The Secretary of State’s proposal for an independent national health service board to allocate resources, provide commissioning guidance and allow GPs to commission services on behalf of patients is the ideal vehicle to give guidance. The first point that I would like to make to my hon. Friend the Under-Secretary is that the new board, when instituted, should offer guidance, through the primary care trusts, on what is available in the health service and stress why integrated health care is so important, for which I would suggest there are three principal reasons. First, people often turn to the alternatives when mainstream medicine has not succeeded. Secondly, conditions often fall into what is known as the effectiveness gap—that is, a category that conventional treatment is unable to help. Thirdly, people might not have benefited from conventional treatments or they might have experienced adverse effects owing to drug reactions.

Another important point, which fits the new coalition Government’s proposal for cost-effectiveness, is that the alternative disciplines—herbal medicine, aromatherapy, homeopathy, osteopathy, chiropractic—are very cost-effective. They are often cheaper than other treatments and, if used in conjunction with mainstream medicine, can be very effective in reducing the effects of heart disease, asthma, back pain and stress, for example. An integrated approach will offer my hon. Friend the Minister and my right hon. Friend the Secretary of State new weapons in the armoury of health care.

In the past few years, there has been a concerted attack on the homeopathic hospitals in this country, which go back to the formation of the health service, and on homeopathic treatments generally, on the ground that the science is weak and does not demonstrate that they are effective. This has manifested itself in bogus Department of Health circulars, in the fact that the British Medical Association’s conferences have tabled motions on the subject, and in the Science and Technology Committee’s recent highly controversial report claiming that homeopathy was a placebo.

The effect of that has been to reduce the number of referrals from primary care trusts in London, particularly to the Royal London Homeopathic hospital. The hon. Member for Hampstead and Kilburn (Glenda Jackson) took up that matter. In other parts of the country, pressure has been put on training. I encourage my hon. Friend the Minister to make a statement tonight that the Government are supportive of the homeopathic discipline, as they said they were before the general election.

The problem with the report that the Science and Technology Committee produced was that it did not take evidence from primary care trusts or from the Society of Homeopaths, and it ignored completely the evidence from abroad, which shows a greatly increased use of homeopathic treatments. For example, in France, homeopathy is taught in seven medical schools and practised by 25,000 doctors. In India, it is part of the health service. There are 180 colleges teaching homeopathy there, and more than 300,000 practitioners. Whatever the merits of the scientific research, the fact is that there are 500 doctors in Britain who choose to use homeopathic treatments as part of their work. Whatever the science says—whether it is proven or not—those people believe that homeopathy works, and that is important.

The costs involved are absolutely minimal. The cost per year to the national health service of homeopathic medicines is £152,000, out of a budget of £11 billion. Over the three years from 2005 to 2008, the hospitals themselves cost the nation £12 million—£4 million a year. These are very small costs, and we really need to take that on board. We must also recognise that there are new approvals coming on stream. At Sao Paolo university in Brazil, homeopathic treatments have been found to be effective in treating depression, instead of Prozac, and the university of Texas has shown the positive effect of homeopathic treatments in killing cancer cells while maintaining good cells. There is a lot to look at there, and the message should be that doctors who wish to use these therapies should do so and should be free to refer. If we can get that simple message across, we will have performed a great service. I am of course speaking to my hon. Friend on the Front Bench.

The regulation of herbal medicine and acupuncture is a crucial area. The previous Government spent for ever debating the matter and calling various professors to look into it. They asked for more and more information, and the final recommendations, produced by Professor Pitillo and Lord Chan, were that these areas should be regulated by the Health Professions Council so that there could be an interface with European legislation next year. However, the recommendation of the outgoing Government was that these matters should be regulated by the Complementary and Natural Healthcare Council instead. I think that that would be a mistake; I believe that we should go for stricter regulation. All the other disciplines could join the 3,000 now registered on the CNHC register. That would be the way forward. Certainly, all the organisations in the field—including the Association of Traditional Chinese Medicine and the European herbal medicine and acupuncture societies—want statutory regulation.

Finally, I turn to deal with what is happening in the rest of the world. I have already referred to the fact that we should take note of the widespread and increasing use of homeopathy in France—I did not mention Germany —and India, while we should also look at what is happening in Australia, which has been a leader. In Australia, according to Government reports, 50% of the population are now using herbal or complementary medicines. There are a number of colleges where these disciplines can be studied and a Complementary Medicine Evaluation committee has been set up; the Australians also have a Therapeutic Goods Administration committee. Herbal medicines are considered by the TGA of Australia to be

“reasonably safe with less adverse reactions than conventional pharmaceutical treatment”—

this is the big hint that we should look seriously at these treatments—and Sydney university has established the herbal medicines research and education centre

“to promote high-quality scholarship and research excellence in herbal medicines through teaching, research and international linkages.”

In fairness to the former Secretary of State, the right hon. Member for Leigh (Andy Burnham), who has just left the Chamber, I should say that he introduced a number of surveys, through the National Institute for Health and Clinical Excellence, which was a welcome development. I think, however, that my hon. Friend the Minister could do more, and I hope that she will. The Australian institutions were given a lot of money. I am not suggesting that there is a lot of money around at the moment, but if Australia can provide $4 million to start up and get going its National Institute of Complementary Medicine, it is something that we should also consider doing.

The other country way ahead of us is the United States of America, which now has a National Centre for Complementary and Alternative Medicine, the federal Government’s lead agency for scientific research on complementary and alternative medicine. It is one of 27 institutes that make up the National Institute of Health in the US and it is statutorily regulated. The mission is to explore

“complementary and alternative healing practices in the context of rigorous science… train complementary and alternative medicine researchers and… disseminate authoritative information to the public and professionals.”

It conducts research using scientific methods and advanced technologies to study CAM. I believe that we should follow that model.

During my time in the House, I have had the honour to chair and be an officer of the parliamentary group for integrated and complementary healthcare and the old parliamentary group for alternative and complementary medicine. Over a period of more than 20 years, we have seen these disciplines come in from out of the cold to complement and augment the wonderful work of our national health service. With our very liberal approach to empowering doctors and to giving patients greater choices in what they want, we have a great opportunity to draw on the wonderful resources we now have vested in our homeopathic hospitals, which offer many other treatments besides homeopathy, and in our 20,000 to 30,000 practitioners out there in the field who can offer herbal medicine and acupuncture.

The Minister now has a great opportunity to grasp the nettle and complete the great work that was started when my right hon. Friend the Member for Charnwood—originally the Member for Loughborough—agreed that doctors taking clinical responsibility could refer to these practitioners. We need to move 20 years ahead, and complete this process with statutory regulation for herbalists and acupuncturists, proper referrals and an acceptance that our 500 homeopathic doctors can refer patients if they want to do so. If we do that, my hon. Friend the Minister will be well remembered in years to come.

22:14

[The Parliamentary Under-Secretary of State for Health (Anne Milton)]

I congratulate my hon. Friend the Member for Bosworth (David Tredinnick) on securing this Adjournment debate on complementary and alternative medicine and integrated health care—a subject that I know is close to his heart. His continued interest and continued efforts to raise the matter in this House, as well as his determination to keep the issue alive and uppermost in our minds, is legendary. He commented himself on his 20 years of campaigning on this issue. It is important to note that it is the efforts of individual Members—their continued efforts, sometimes against the odds—that keep these issues uppermost and alive in our minds.

My hon. Friend may be interested to know that although I trained as a nurse and worked in the NHS for 25 years in conventional medicine, my grandmother trained at the homeopathic hospital in London, and was herself a homeopathic nurse. Later, she became a Christian Scientist. I am therefore not without my own roots in alternative therapies. My hon. Friend may also be interested to know that my grandmother never, until her death at the age of 89, took any conventional medicine.

My hon. Friend raised the issue of homeopathic hospitals and his concern about them. I understand that there are five such hospitals in the United Kingdom, based in London, Bristol, Tunbridge Wells, Liverpool and Glasgow. However, the Tunbridge Wells homeopathic hospital stopped providing services in March 2009 owing to the primary care trust’s decision to end funding. All the hospitals have experienced a reduction in the number of referrals over the past three years, and it has been claimed that all of them are now in a precarious position as a result of such significant funding losses. That is a matter of concern, given that they have clearly offered valuable treatments to patients.

My hon. Friend said that a number of people turn to alternative therapies when they have either been failed by conventional medicine or have adverse responses to it. Although he referred to the current position, it may help if I make some more general points connected with our approach to health care.

Decisions about patient care are best made by clinicians. Local practitioners are best equipped to decide which therapies will ensure the best outcomes for individual cases, and are best placed to decide which services can cater for their areas’ health needs—in conjunction, of course, with patients themselves. The Government’s role in all that is to empower patients and professionals to take control of the funding and provision of health services in their areas, to encourage further research on new treatments and therapies, to support the local NHS by providing information on the clinical effectiveness and cost-effectiveness of various treatments, and, of course, to protect the public by ensuring that those treatments are safe. We do that through the National Institute for Health and Clinical Excellence, which is responsible for making recommendations on treatments to the NHS, and through the Medicines and Healthcare products Regulatory Agency, which is responsible for regulating the safety of medicines and treatments. The Government also encourage research on new medical treatments and technologies, primarily through the National Institute for Health Research. Research proposals are assessed in open competition, on the basis of scientific quality, and are subject to peer review.

My hon. Friend raised the issues of choice and cost-effectiveness. He observed that complementary and alternative medicines were often very cost-effective, and that the methods of treatment often involved limited invasiveness. It may be useful to deal with those two issues together, as they go to the heart of my hon. Friend’s concern: the fact that PCTs are not commissioning or fully using complementary and alternative medicines.

As I stated earlier, we believe that local practitioners are best placed to make decisions about individual care, and that GPs are often most in touch with the health needs of their local populations. That is why it is so important that this Government will seek to give GPs more power to commission services, and patients more power to choose health care providers. By bringing together groups of general practitioners and giving them direct control over the health budgets of their patients, we will push the decision-making process closer to patients—closer to the heart of the problem. GPs will have the power to choose how to spend resources in order to achieve the best health outcomes, and we will ensure that PCT boards include directly elected individuals who can speak for patients at board level so that local people have a voice when decisions are made about local health provision.

Giving GPs more responsibility and more control over how NHS resources are used in their areas, and giving patients the power to choose any provider that meets NHS standards, will result in a health service that is not only more flexible, which is what my hon. Friend wants, but more responsive to patient need. As he will be aware, the decision to commit NHS resources cannot be taken lightly, especially during a period when the NHS as a whole must find considerable efficiency savings. Commissioners must be sure they are funding treatments that will result in the best health outcomes. That is what we all want. They must be sure of the safety, clinical and cost effectiveness, and availability and evidence in support of any therapy, and they must be sure that there are suitable practitioners in their area to deliver it.

The issue of regulation was raised, and it is a thorny one. When I was a shadow Health Minister, I met on numerous occasions psychologists, psychotherapists and counsellors who were very concerned about the regulation of their professions. Across the professions allied to health care, there are those who are keen on regulation and those who feel regulation would be wrong and would be unable to deal with the intricacies of their work. There is no doubt that vulnerable people are often preyed upon by unskilled and unscrupulous practitioners, and I think that professions wanting to achieve the highest standards will welcome proper regulation. The issue for Government is always whether statutory regulation is the most appropriate way of dealing with that risk, or if a lighter-touch approach would be more appropriate. That is why, as I understand it, last year the Department of Health, along with devolved Departments, consulted on the regulation of practitioners of acupuncture, herbal medicine and traditional Chinese medicine. As my hon. Friend will be aware, the consultation closed in November, and more than 6,000 responses were received. The high response rate is a testament to the strength of feeling about public access to complementary and alternative medicines; I am sure I am not alone in having received a huge number of letters on the subject.

The consultation examined in detail the options for regulation, including alternatives to statutory regulation. Once the Government have considered the consultation responses, we will make clear the next steps in the regulatory process. In acknowledgment of my hon. Friend’s keen interest in the matter, I am very happy to keep in touch with him about it. In the meantime, the Complementary and Natural Healthcare Council provides for voluntary registration for practitioners from nine complementary therapy disciplines. I appreciate that my hon. Friend feels that that is not sufficient, but that is in place for the moment while we consider the consultation that has taken place and make a decision on what the next steps should be.

I note my hon. Friend’s comments on the Lords Science and Technology Committee report on homeopathy, and I am aware that it caused quite a lot of concern. It was published on 22 February, and we are still considering it and will formally respond in due course. He raised considerable concerns about the report, and highlighted the low cost of many alternative therapies and the important contributions they make. He also made reference to experiences from around the world—he mentioned Australia in particular, and also the USA—and he made an important point about the open-mindedness of some countries to alternative therapies.

In considering outcomes, patient-reported outcome measures must be an important factor. As my hon. Friend rightly said—and as I mentioned—individuals’ own experiences are very important, and if we want to achieve the best outcomes, one step we must take is to ask the patient whether they actually got better.

In conclusion, I wish to thank my hon. Friend for his contribution to the debate and to suggest that perhaps the picture is not as bleak as he fears—I noted a certain weariness in his voice; he feels that he has raised this issue on so many occasions and it has fallen on deaf ears.

[David Tredinnick]

As I have been in this position before, I was nervous that the Minister might sit down before I had the chance to make a final intervention. I wish to make one plea to her. I listened carefully to what she said in the past five minutes and I wish to suggest to her that it would be enormously helpful if the Department were to issue a circular to primary care trusts saying that it is not against these therapies and it is up to doctors to decide whether or not they can be used, that it has no bias against them and that it is leaving it to the clinicians to decide whether or not they wish referrals to be made to PCTs and on to hospitals. A great fog surrounds this issue. Nothing may come out of tonight’s debate apart from the fact that we have discussed the matter, but it would be very helpful if she could consider issuing a direction saying, “It’s over to you. We are not objecting to this.”

[Anne Milton]

I thank my hon. Friend for that intervention. As the new Minister in this post, I am hesitant to commit to things that I feel might be above my pay grade.

[Mr Stephen Dorrell (Charnwood) (Con)]

Quite right.

[Anne Milton]

I think that I am quite right about that, because that sort of thing is, in general, a career-limiting move. I think that what my hon. Friend the Member for Bosworth is saying, what his concern is and why he feels that the picture is rather bleak is that he has encountered minds that are closed to alternative therapies. That will not be solved by the Government issuing directives, because a number of issues need to be considered, one of which is the training of doctors and those in other professions allied to health care. Our move towards GPs having more power and control, and towards their having the ability to commission services, will, in itself, loosen the ties on how they think about where the best treatment will be found.

I am sure that my hon. Friend will be pleased that acupuncture is used widely in pain clinics and even in some maternity services, and that the Department of Health continues to fund research into new treatments, through the National Institute for Health Research, and to award funding for studies into the efficacy and value of complementary and alternative medicines. The National Institute for Health and Clinical Excellence has already published guidance that refers to complementary therapies—for example, those relating to lower back pain, multiple sclerosis, antenatal and palliative care. Our approach to all treatments, be they complementary, alternative or mainstream, is the same. Treatments must be supported by robust evidence, and they must meet safety, quality, clinical and cost-effectiveness criteria. If they are then called for by clinicians on the ground, they should be, can be and will be used in the NHS.

Question put and agreed to.

22:28

House adjourned.

Written Ministerial Statements

Wednesday 2nd June 2010 Written Statements

Wednesday 2 June 2010

EU Competitiveness Council

Wednesday 2nd June 2010 Written Statements

[The Parliamentary Under-Secretary of State for Business, Innovation and Skills (Mr Edward Davey)]

The EU Competitiveness Council took place in Brussels on 25 and 26 May 2010. The Secretary of State for Business, Innovation and Skills, my right hon. Friend the Member for Twickenham (Vince Cable) represented the UK on EU internal market and industry issues on 25 May and the Minister for Universities and Science, my hon. Friend the Member for Havant (Mr Willetts) represented the UK on EU research issues on 26 May. Andy Lebrecht, the UK’s deputy permanent representative to the EU represented the UK when a Minister was not in attendance. A summary of those discussions follows.

The main Internal Market/Industry Council items discussed on 25 May were harmonisation of the marketing of construction products, energy-efficient vehicles, future revision of the trade mark system in the EU, the services directive, EU consumer rights, and the Mario Monti report on the EU single market.

The Council reached political agreement with UK support on a common position for a regulation on the marketing of construction products. Council conclusions were agreed on an EU strategy for clean and energy-efficient vehicles. In discussion the UK supported the strategy but stressed the need for a technology-neutral approach, which was also supported by several other member states.

The Council approved conclusions on the future of the trade mark system in Europe and the Commission confirmed their commitment to the harmonisation of EU trade marks systems and the enforcement of intellectual property rights. The Commission and the Spanish EU presidency gave an update on the implementation of the services directive, stressing the added value that full implementation would bring to the EU.

There was a ministerial lunchtime discussion on the recent Mario Monti report on the future strategy for the EU single market. The Council also debated the proposed EU consumer rights directive which seeks to harmonise consumer law to make cross-border trade easier. The UK stressed the importance of full harmonisation where this would be beneficial, while allowing member states to determine the right level of consumer protection and consumer rights.

The any other business items discussed covered a draft regulation on textile labelling, the Commission’s EU digital agenda document, the latest EU consumer markets scoreboard and a legal framework for gambling and betting in the EU. There were also Commission reports on a recent European shipbuilding conference and on an informal EU Ministers meeting on tourism.

The main Research Council items discussed on 26 May were the Commission’s Europe 2020 strategy, ITER (the International Thermonuclear Experimental Reactor), the Global Monitoring for the Environment and Security (GMES) European earth observation programme, the Baltic sea research and development programme (BONUS) and the European research area.

On Europe 2020, the proposed EU-wide 3% GDP target for investment in research and development was debated by Ministers. The UK stressed the importance of research and innovation and said it was considering its national target. A number of member states said they wished to keep their national targets under review.

The Council discussed the status and long-term funding of ITER. The UK and a number of other member states recognised the scientific importance of ITER but stressed the need for careful negotiation on funding to avoid placing undue cost burdens on member states.

The Council also agreed conclusions on innovation which will contribute to the Commission’s research and innovation plan. The presidency gave an update on progress on reaching agreements with the European Parliament on GMES and on BONUS. The Council also agreed conclusions on the European research area on the formation of a new more strategic committee.

The any other business items discussed covered updates on the Citizens agenda of Science and Innovation, the European Institute of Technology, European Co-operation in Science and Technology (COST) and the Strategic Forum for International Scientific and Technical Co-operation.

Local Government (Doncaster)

Wednesday 2nd June 2010 Written Statements

[The Secretary of State for Communities and Local Government (Mr Eric Pickles)]

I am announcing today a package of intensive measures that I am proposing to put in place to turn around Doncaster metropolitan borough council after 15 years of poor governance and dysfunctional politics.

Following a corporate governance inspection of the council, the Audit Commission published their report on 19 April 2010 which concluded that the council is not properly run, is failing, and lacks the capacity to improve. The commission recommended statutory intervention by the Secretary of State.

The then Government accepted the report, announced that Government would intervene, and sought representations from the authority and its partners by 25 May on the form that intervention might take. It also established an emergency advisory board to provide, if urgent decisions were needed, leadership and clear support to the council’s acting chief executive.

I have considered carefully the Audit Commission’s report and recommendations, together with the representations received from the council, including the mayor, and its partners about the form of any intervention.

I am satisfied that there is a strong case for intervention at Doncaster metropolitan borough council, and I have issued today to that authority a draft of a direction that I intend to make under section 15 of the Local Government Act 1999 specifying the form of intervention to be put in place at Doncaster, together with a draft explanatory memorandum.

The intervention package that I am proposing has been developed working with the Local Government Association and others in local government. It consists of my giving directions on three matters: first, the appointment of a head of paid service who will provide officer leadership and recommend appointment of statutory officers; secondly, the appointment of three commissioners who will be responsible for other officer appointments and any other matter referred to them; and thirdly, the council’s co-operation with an intervention and recovery board comprising the commissioners and other experts to provide external support and challenge.

The authority now has until the 23 June to make any representations it wishes on the draft direction. Having regard to any representations I receive, I intend to take a final decision on the form of intervention by the end of June.

Copies of the draft direction and explanatory memorandum have been placed in the Library of the House.

Employment, Social Policy, Health and Consumer Affairs Council

Wednesday 2nd June 2010 Written Statements

[The Parliamentary Under-Secretary of State for Health (Anne Milton)]

The Employment, Social Policy, Health and Consumer Affairs Council will meet on 7 and 8 June. The Health and Consumer Affairs part of the Council will be taken on 8 June.



Items on the main agenda are: patients’ rights in cross-border health care; provision of food information to consumers; health inequalities; and national initiatives on salt.

The presidency is likely to ask Ministers for political agreement on the directive on the application of patients’ rights in cross-border health care. They also propose to adopt Council conclusions on both the reduction of health inequalities and the reduction of salt in food. The United Kingdom supports the adoption of these two proposals. A policy debate is expected on a regulation on the provision of food information.

Under any other business, information will be provided from the presidency on the two aspects of the pharmaceutical package—proposals to reduce the threat from counterfeit medicines and strengthening of community pharmacovigilance. In addition, we expect the presidency to provide information in preparation for the conference of the parties to the framework convention on tobacco control to be held later this year.

Justice and Home Affairs pre-Council Statement

Wednesday 2nd June 2010 Written Statements

[The Parliamentary Under-Secretary of State for the Home Department (James Brokenshire)]

The Justice and Home Affairs Council is due to be held on 3 and 4 June in Luxembourg. the Secretary of State for Justice, my right hon. and learned Friend the Member for Rushcliffe (Mr Clarke) and I intend to attend on behalf of the United Kingdom. As the provisional agenda stands, the following items will be discussed:

Council conclusions on the Stockholm programme action plan are on the A points list for agreement without discussion, unless any member state intervenes. The conclusions emphasise that the Stockholm programme sets the agenda, note that there are inconsistencies between the action plan and the programme and urge the Commission to bring forward only those actions that are in full conformity with the programme.

Her Majesty’s Government do not support every aspect of the Stockholm programme action plan and while we will support the Council conclusions I will make it clear that this does not imply our backing for the entirety of the Stockholm programme, in particular the idea of a European public prosecutor and a common asylum policy. The UK will consider whether or not to opt in to new legislative proposals resulting from the Stockholm programme on a case-by-case basis.

The Council, beginning in Mixed Committee with Norway, Iceland, Lichtenstein and Switzerland—commonly referred to as the Schengen States—will hear a state-of-play report from the Commission on the second generation Schengen Information System (SIS II). The Commission will also present a comprehensive global schedule and budget for the entry into operation of SIS II.

The Council will be asked to adopt conclusions encouraging member states to make more extensive use of automated border control systems at their external borders. The UK will not participate in these automated systems, or the EU passport regulation on which the automated systems will be based, as they build on elements of the Schengen acquis in which we do not participate.

The Council will receive an update on the progress of the visa liberalisation road maps for the western Balkan countries agreed by the EU in 2009. The UK does not participate in EU common visa policy, as it builds on an area of the Schengen acquis in which the UK does not participate.

After Mixed Committee, the presidency will present the first main assessment description report for internal debate (MADRID) report on internal security in the EU. The report is a combination of threat assessments from Europol, Eurojust and Frontex against which the Council will be invited to debate and consider priorities for future action. The Council will not however be asked to approve the report.

Next there will be a discussion on the most recent report from the counter-terrorism co-ordinator (CTC), Gilles de Kerchove, on the implementation of the EU strategy and action plan to combat terrorism. The report examines the nature of the threat, transportation security—especially in the field of land transport—monitoring of terrorist travel, and the connecting of internal and external security. The UK supports efforts made by the EU CTC to continue to drive forward EU action and co-operation on counter terrorism.

The Council will then be asked to accept the draft text and sign off the EU-US counter-terrorism declaration, the declaration is intended to provide a durable framework for EU-US counter terrorism co-operation. The UK supports the declaration.

Over lunch Interior Ministers will discuss the seat of the IT agency. The UK has not yet taken a view on which member state’s application to support.

The presidency will update Ministers on progress on the “European Pact to Combat International Drug Trafficking”, which is designed to enhance operational co-operation of EU countries in the fight against drug trafficking. The pact focuses on three broad areas of activity: disrupting cocaine routes; disrupting heroin routes; and tackling the money flows. The UK supports the pact and looks forward to its implementation.

The Council will receive an update on the progress of negotiations with the US on the agreement between the European Union and the United States of America on the terrorist finance tracking programme (TFTP). The Council agreed in May a negotiating mandate for the Commission to undertake negotiations with the US.

The presidency will update Ministers on the EU-Russia JHA Permanent Partnership Council meeting of 25 and 26 May, which was held in Kazan at which possible EU-Russia visa liberalisation and migration dialogue were discussed.

The Commission will ask the Council to adopt conclusions on unaccompanied minors, outlining proposals for handling the large numbers of unaccompanied children who enter the EU annually.

The Council will debate the follow-up to the EU pact on immigration and asylum, in advance of the first annual debate on this issue scheduled to take place at the June European Council. The Council will also adopt conclusions on the Commission’s first annual progress report on the implementation of the migration pact, which summarise activity since implementation of the pact and make recommendations for priorities in the coming year.

Under AOB, Malta has requested that the Council discuss a LIBE—European Parliament Civil Liberties Committee—study entitled “What system of burden-sharing between member states for the reception of asylum seekers?”. The Council will also be updated on the progress of negotiations on the EU readmission agreement with Turkey and any further action required by individual member states to continue momentum on negotiations. The Czech Republic has asked the Commission to update the Council on their negotiations with Canada to lift the current visa requirement on Czech citizens.

On the second day of the Council, there will be a state-of-play report on the proposed directive on interpretation and translation in criminal proceedings. This is the first measure of the criminal procedural rights road map, and it aims to improve access to interpretation and translation for defendants. The presidency hopes to inform the Council about the first reading agreement with the European Parliament, which is expected to vote to approve the instrument, as amended, during the week commencing 14 June.

The Spanish presidency will be looking to agree on a general approach for a directive on the European protection order. This is a proposal by the Spanish presidency that aims to provide continuous protection to vulnerable people as they move from one member state to another

The presidency will seek to reach a general approach on the Commission proposal for a directive on combating human trafficking as the basis for the next stage of negotiations with the European Parliament. The text is broadly similar to the text of the proposal for a framework decision on which the Council reached political agreement last November. The Government are broadly content with this approach, although we have not yet decided whether to opt in and the proposal remains subject to parliamentary scrutiny.

The presidency will seek political agreement on a proposal to authorise enhanced co-operation in the area of the law applicable to divorce and legal separation—also known as Rome III. This will be the first time that enhanced co-operation has ever been used. The presidency will be seeking also to reach agreement on key elements of the draft regulation implementing enhanced co-operation in this area. The Committees will be aware that the UK did not opt in to the original Rome III proposal in 2006. The Government do not intend the UK to participate in the enhanced co-operation.

There is also due to be agreement to high-level political guidelines for future work on the proposed regulation on succession and wills. As the UK has not opted in to this proposal it will not participate in any vote on these guidelines.

The Council will look to confirm the adoption of a negotiating mandate for discussions with the Council of Europe on the EU accession to the European convention of human rights. The aim of the accession is to close the gap in judicial protection of fundamental rights in the EU by ensuring that the EU institutions, as well as the member states when implementing EU law, will clearly be subject to the convention. The UK supports the EU’s accession to the ECHR.

Ministers will be presented also with a state-of-play report on e-Justice work and asked to endorse an updated road map setting out a timetable for future projects.

Under any other business, at the request of the Austrians, there will be an item on the academy for the fight against corruption. This was discussed recently at the CATS meeting for senior officials. This is likely to be a presentation by Austria outlining progress on the academy which is based near Vienna and is due to be operational in 2011. The academy aims to be a centre of excellence in anti-corruption education, research and professional training, and will be the first of its type in the world.

Machinery of Government: Departmental Organisation

Wednesday 2nd June 2010 Written Statements

[The Prime Minister (Mr David Cameron)]

I am today outlining machinery of government changes affecting a number of existing Departments of State.

These changes are a result of the formation of the coalition Government and will help implement the programme for Government. Further adjustments may be made and announced in due course.

The Cabinet Office

As previously announced the Deputy Prime Minister has been given special responsibility for political and constitutional reform. To bring this into effect responsibility for the following will transfer from the Secretary of State for Justice to the Deputy Prime Minister:

Introducing fixed-term Parliaments

Legislating to hold a referendum on the alternative vote system for the House of Commons and to create fewer and more equal sized constituencies

Supporting people with disabilities to become MPs

Introducing a power for people to recall their MP

Developing proposals for a wholly or mainly elected second Chamber

Speeding up implementation of individual voter registration

Considering the “West Lothian question”

Introducing a statutory register of lobbyists

Reforming party funding

Supporting all postal primaries

The Deputy Prime Minister will also have policy responsibility for the Electoral Commission, Boundary Commission and Independent Parliamentary Standards Authority.

The Office of the Third Sector will become the Office for Civil Society and support the Minister for Civil Society who is based in the Cabinet Office.

The Government Equalities Office

The Government Equalities Office, which is responsible for the implementation of the Equality Act 2010, as well as the Government’s overall strategy on equality issues, will report to the Home Secretary, who is also the Minister for Women and Equalities.

The Olympics

Ministerial responsibility for the Olympic and Paralympic games was previously held by the Minister for the Olympics in the Cabinet Office. The Secretary of State for Culture, Olympics, Media and Sport will now be responsible.

Education

The Secretary of State for Education has replaced the Secretary of State for Children, Schools and Families, and the Department for Children, Schools and Families is renamed the Department for Education.

House of Lords

Wednesday 2nd June 2010 Lords Chamber

Wednesday, 2 June 2010.

15:00

Prayers—read by the Lord Bishop of Wakefield.

Several noble Lords took the oath or affirmed.

Health: Contaminated Blood Products

Wednesday 2nd June 2010 Lords Chamber

Question

15:14

Tabled by

[Lord Morris of Manchester]

To ask Her Majesty’s Government what is their response to the implications for the Department of Health and haemophilia patients infected by contaminated NHS blood products of the High Court judgment in March v Secretary of State for Health; and what action they will be taking.

[Lord Morris of Manchester]

My Lords, I beg leave to ask the Question standing in my name on the Order Paper and, in doing so, declare a non-pecuniary interest as president of the Haemophilia Society.

[The Parliamentary Under-Secretary of State, Department of Health (Earl Howe)]

My Lords, we have decided not to seek leave to appeal the judgment, and we shall be writing shortly to let the court know of our decision. We are considering our response to the judgment and will announce our decision in due course. In the mean time, ex-gratia payments will continue to be paid at current levels to those affected.

[Lord Morris of Manchester]

My Lords, I am grateful to the noble Earl and congratulate him on his well merited ministerial post, which I know he will grace with all his customary integrity. Is he aware that 1,982 haemophilia patients have now died from being infected with HIV and hepatitis C by contaminated NHS blood products in this worst ever treatment disaster? Given the High Court’s landmark judgment, the wide all-party acclaim for the Archer inquiry’s findings and David Cameron’s strongly positive response to the Haemophilia Society’s pre-election call for urgent new help for the afflicted and bereaved, can the Minister confirm that there will be no delay now in ensuring a just settlement for this cruelly stricken and arguably most needful minority in Britain today?

[Earl Howe]

My Lords, perhaps I may begin by thanking the noble Lord for his kind words. I am sure he knows how seriously I take these matters. I hope he can take as read my wish to see that those whose health is suffering as a result of this tragedy are properly looked after by the NHS. I know that the noble Lord will understand that we are looking at the court judgment. It is early days yet, but we are considering very carefully what the court has said and I cannot be of more help to him at this stage than I already have been in my earlier Answer. I stand ready to talk to him, either inside or outside this Chamber, on these important matters.

[Lord Archer of Sandwell]

My Lords, I endorse my noble friend’s congratulations to the noble Earl. Do the Government accept that the scale of payments to victims in Ireland was not a response to criticisms from an official inquiry, as the scale had been decided and implemented long before either official inquiry reported? Furthermore, is it now accepted that to argue that there has been no similar criticism from an official inquiry in this country is, to say the least, disingenuous, as successive Governments have failed to appoint one?

[Earl Howe]

My Lords, obviously, I cannot speak on statements made by Ministers of the former Administration. However, I can confirm to the noble and learned Lord that the compensation scheme in the Republic of Ireland was set up in the light of evidence of mistakes made by the Irish Blood Transfusion Service Board. That has been confirmed to us by officials in the Republic of Ireland’s Department of Health and Children. It is important to understand that the events that gave rise to the people in Ireland becoming infected through contaminated blood transfusions were quite dissimilar to the sequence of events that occurred here. There were specific circumstances in Ireland, and quite different circumstances in the UK.

[Baroness Campbell of Surbiton]

My Lords, I declare an interest as the widow of a haemophiliac who died from contaminated blood products 16 years ago. Is the Minister aware that many of the widows, widowers and children of people who were infected and died received very little compensation—in fact, many do not receive a penny in support from the state? Does he not agree that it would have been wiser to spend the Department of Health’s money used to fight the High Court case on supporting those bereaved families, many of whom have lost their breadwinner?

[Earl Howe]

My Lords, I am well aware of the noble Baroness’s personal interest in this matter and feel deeply for her. She is of course correct that the Skipton Fund was not designed to support bereaved relatives. It was designed to alleviate the suffering of those infected with hepatitis C. Sympathetic as I am towards those who have lost their loved ones in this tragedy, that fund does have a specific purpose and it would require a major review to alter that purpose. However, I note her concern on this matter.

[Lord Alderdice]

My Lords, I share in the congratulations and good wishes to the noble Earl, who has served this House so well on health issues, and offer my congratulations to the noble Lord, Lord Morris of Manchester, and the noble and learned Lord, Lord Archer of Sandwell, on their tenacious pursuit of this issue. Does the noble Earl agree that the High Court judgment shows a confusion of thinking on the part of the Department of Health not only in regard to this matter but on the whole question of dealing with adverse health events? Does he accept, as the Scottish Executive have done, as the Chief Medical Officer did in 2003 and the National Audit Office did in its report in 2004, that much more money would be available in compensation if it were not being spent on legal fees and court cases, and that the introduction of a no-fault compensation scheme could achieve that?

[Earl Howe]

My Lords, I share the noble Lord’s antipathy to taxpayers’ money being shelled out in legal fees, but what has happened has happened. In the current constrained financial climate, every department of Government will look very carefully at its legal activity.

[Baroness Thornton]

My Lords, I join my noble friend in welcoming the noble Earl to his new position and wish him all the very best. Not so long ago, during the passage of my noble friend’s Bill last November, the noble Lord, Lord Thomas of Gresford, and the noble Baroness, Lady Barker, were very keen on a full compensation package for those affected by contaminated blood products. Has this commitment been translated into the coalition Government’s policy? If so, how and in what timescale?

[Earl Howe]

My Lords, I thank the noble Baroness for her kind remarks. We are in a coalition Government. Not every pledge in either the Conservative or the Liberal Democrat manifesto can be honoured. That is the nature of coalitions. In fact, the specific Liberal Democrat proposal which she referred to was not included in the programme for government which we published.

Korean Peninsula: “Cheonan”

Wednesday 2nd June 2010 Lords Chamber

Question

15:22

Tabled by

[Lord Alton of Liverpool]

To ask Her Majesty’s Government what assessment they have made of the situation on the Korean peninsula; and what consideration they have given to placing the sinking of the “Cheonan” before the United Nations Security Council.

[Lord Alton of Liverpool]

My Lords, I beg leave to ask the Question standing in my name on the Order Paper and, in so doing, I declare a non-pecuniary interest as chairman of the All-Party Group on North Korea.

[The Minister of State, Foreign and Commonwealth Office (Lord Howell of Guildford)]

My Lords, we are concerned about the situation on the Korean peninsula following the sinking of the “Cheonan” vessel. The Government are in no doubt that North Korea was responsible for this callous and unacceptable act. The Prime Minister has expressed his sympathy to President Lee for the loss of life. We urge North Korea to acknowledge responsibility and to avoid escalating tensions further. We understand that South Korea will request that the UN Security Council looks at this issue next week and we are working with South Korea and other international partners to ensure the strongest possible response with a UN Security Council consensus.

[Lord Alton of Liverpool]

My Lords, on this, his first appearance at Question Time as the Minister dealing with international and foreign affairs, and in the light of the huge contribution that he made during his time in opposition, I am sure that the whole House will want to welcome the noble Lord to his onerous duties and responsibilities.

When this matter comes before the Security Council next week, will we be pressing for a commission of inquiry or a referral to the International Criminal Court on these events, which led to the deaths of 46 people following the sinking of the “Cheonan”? Are we also engaging with the Government of China? That is crucial if we are to make progress on this matter.

[Lord Howell of Guildford]

I thank the noble Lord for his kind remarks. He is second to none in his expertise on North Korea and in his concern for human rights there. The problem with a commission is simply that China will not go along with it, so we would never get unity among the permanent five. Also, North Korea is not a signatory to the ICC. Although we want strong action, we want to try to keep the permanent five together and to get some kind of statement or resolution that will really have an effect and make an impact.

[Lord Hannay of Chiswick]

Have the Government had any indication of what the Chinese Prime Minister may have meant when he reportedly said in Seoul that the Chinese Government would not protect anyone responsible for this incident? Are we taking steps to bring home to the Chinese Government the proposition, with which I hope that the Minister would agree, that if they were to block an effective response in the Security Council, that would be a major contribution to insecurity in north-east Asia?

[Lord Howell of Guildford]

Yes, we are taking all the steps that we can to bring the Chinese along. We would obviously like their support, but there are difficulties. The statement from the Chinese leader that he would not protect those who did this raised hopes but, thereafter, the Chinese went rather ambiguous and are now not prepared to apportion blame. That is the problem and where we are now.

[Baroness Kinnock of Holyhead]

My Lords, I, too, add my welcome again to the noble Lord, Lord Howell, in his new role. I shall pursue the Minister on the ICC. The UN special rapporteur for North Korea has called for strong UN action. He said that a commission of inquiry should be set up on crimes against humanity in North Korea and he called for serious consideration of the need for an indictment of individual members of the regime. Does the Minister agree with that position? What action will the coalition Government take in pursuit of those objectives?

[Lord Howell of Guildford]

Yes, I agree. The Government would be concerned to see that any criminals, or those accused of war crimes internationally, were properly charged, where they can be reached by the jurisdiction of the ICC. There is a difficulty, given that Korea has not signed up to the ICC, which is why we feel that the commission of inquiry may be some way down the road, as it is a difficult thing to get started now.

[Lord Pannick]

Have the Government considered the possibility of expanding or encouraging the expansion of the jurisdiction of the ICC so that it would have a role in relation to conduct within a state that does not recognise the powers of the ICC?

[Lord Howell of Guildford]

We debated these matters closely in this House—I cannot remember whether the noble Lord was a Member at the time—and looked at that possibility. The Government have no plans to do so at present.

[Baroness Falkner of Margravine]

My Lords, does the Minister accept that China’s position of so-called impartiality on this question is unsustainable, because it cannot use that approach to other countries in which it also takes an interest, such as Iran? Are we pressing on China, in this case, the need for it to be clear at the UN Security Council next week about where it stands, given that the United States has offered to share with it its assessment of intelligence information, in addition to the independent commission’s report?

[Lord Howell of Guildford]

My noble friend is absolutely right that, if we can persuade the Chinese that their troublesome and awkward neighbour could be just as damaging to them as to the rest of us, we will be making progress. We are talking to them at a number of levels and we may make progress. However, at the moment, the Chinese are reluctant to pin blame. That is the problem.

[Lord Bates]

I, too, welcome my noble friend to his duties, to which he brings enormous expertise. As well as ensuring that there is a suitably robust international response to the specific instance that we are talking about, will he ensure that some progress is made on the lingering injustice of the artificial division of the Korean peninsula along the 38th parallel? Will he ensure that the pledge that was made in Cairo nearly seven years ago to try to bring about an independent, demilitarised, democratic and free united Korean people is also progressed as a way of reducing tension?

[Lord Howell of Guildford]

That would, in theory, be the ideal. It is basically up to the nation states involved: North Korea and South Korea. In practice, there are, to put it mildly, a few difficulties.

[Lord Grenfell]

My Lords, I join those who have expressed words of welcome to the noble Lord, Lord Howell, on his return to the government Front Bench. He is my old roommate from Cambridge and I think that I was almost in short trousers when he first went into government. I am delighted to see him back.

Do Her Majesty’s Government have any plans to try once again to persuade the United States to recognise the International Criminal Court? It would be helpful if the United States could overcome its shyness on this, because it would carry a great deal of weight in dealing with rogue states such as North Korea.

[Lord Howell of Guildford]

I thank the noble Lord—indeed, my noble friend, as he is—for his compliment, if it was a compliment. We must keep trying. The United States has deep-rooted objections, as we discovered when we debated this matter in the House some years ago. It is nervous that its troops and personnel around the world might be unfairly attacked and charged. However, we must keep at it and I agree with the noble Lord that this is a good way to go.

Immigration: Detention of Children

Wednesday 2nd June 2010 Lords Chamber

Question

15:29

Asked by

[Lord Kirkwood of Kirkhope]

To ask Her Majesty’s Government when they will end the detention of children for immigration purposes.

[The Minister of State, Home Office (Baroness Neville-Jones)]

My Lords, the Government are committed to ending the detention of children for immigration purposes. My honourable friend the Minister of State for Immigration is heading a review on the way forward, which aims to protect the welfare of children while ensuring the removal of those who have no right to be in the UK. He will set out the way forward as soon as possible: certainly in the coming weeks. Currently, I might add, there is one family with two children in immigration detention.

[Lord Kirkwood of Kirkhope]

My Lords, I am grateful to the Minister for that reply, and I welcome her to her new high ministerial office and wish her well for the future. When does she expect to be able to end child detention for immigration purposes? Does she not agree that it would be a signal success for the new Government if there could be an early announcement that ended the practice? Is there any chance of her being able to do that sensibly before the House rises for the Summer Recess?

[Baroness Neville-Jones]

My Lords, I thank the noble Lord very much for his kind words. I certainly agree that we want to progress this as rapidly as possible. I cannot unfortunately give him a deadline today, but I hope that my honourable friend in the other House will have more details really quite shortly. At the moment, we are working with various charities and NGOs that will help us to find solutions so that we can come forward with something that is not just process but that incorporates a solution. We will do that as rapidly as we can. The noble Lord is quite right that we need to end this as soon as possible.

[Lord Dubs]

My Lords, many of us who have argued for years that children should not be detained under immigration powers will welcome what the Government appear to want to do. Will the Minister confirm, however, that ending the detention of children must mean that families—parents as well as the children—will no longer be detained? If it does not, this will involve separating children from their families, which would be a retrograde step.

[Baroness Neville-Jones]

We certainly aim not to separate families from children or children from families. The noble Lord is quite right, and I think the House would agree, that this is not an ideal form of detention. I cannot say categorically how we will work it out, but the aim is certainly to keep families together.

[Lord Ramsbotham]

My Lords, I welcome the Minister to her position. While I welcome the statement about ending the detention of children, will the review consider the position of another group of children who are held in detention? I refer to the hundreds of independent juvenile asylum seekers who are currently being held in social services care around the country. There is a real need to look at the consistency of their treatment and conditions because those differ widely in different parts of the country.

[Baroness Neville-Jones]

The noble Lord makes a very important point. I am aware that children who are not in immigration detention and who are unaccompanied are indeed with local authorities. I will take back his point about the inconsistency of treatment and report back to the House.

[Baroness Finlay of Llandaff]

My Lords, I, too, congratulate the noble Baroness. Is consideration being given in the review to the bereavement needs of children, given that many children who come here as asylum seekers, or indeed for other immigration purposes, have often undergone traumatic bereavements? The incidence of severe bereavement reactions among these children is particularly high, and lack of attention to that in the processes to which they are subjected may make their experiences worse.

[Baroness Neville-Jones]

The noble Baroness makes an important point. All I can say at the present stage is that in the guidelines that we agree consideration should be given to cases of this kind in which an individual problem needs extra help.

[Lord Avebury]

My Lords—

[Noble Lords]

It is the turn of the Bishops.

[The Lord Bishop of Liverpool]

My Lords, will the Minister confirm that this is the only category of children who can be detained indefinitely without the oversight of the courts and without ever having committed a crime?

[Baroness Neville-Jones]

That is the formal case. However, in current circumstances, the average time for which children are being detained is only about 11 days. We are trying to bring that figure down. I pay tribute to the previous Government who did great work in bringing the timescale of these detentions down. I entirely agree that it is a problem. We are trying to make the system as humane as possible.

[Lord Avebury]

My Lords, perhaps I may ask my noble friend about the consultations which on 12 May Mr Damian Green said had already started. Stakeholders, such as the Children’s Society, do not seem to be aware of that. Is it the intention to complete the consultation in six weeks, as we have heard? Will that be in time for them to incorporate any necessary amendments to the Secretary of State’s powers to look after these children under alternative arrangements in the Borders, Citizenship and Immigration Act which will come before your Lordships?

[Baroness Neville-Jones]

My Lords, I will look into that point. I cannot give the noble Lord a definitive answer. All I can say is that we intend to proceed with this really fast. This review will not take very long. I hope that that timescale can be met.

[Lord West of Spithead]

My Lords, I, too, congratulate the Minister on her new post. I was delighted to hear her say how well the previous Government had done, which I never thought that I would hear. This shows the complexity of this entire subject. Having been beaten around the Floor of this House again and again by my friends, particularly those who were Liberal Democrats in the past, people are realising how extremely difficult it is. When I looked at this in the past, the difficulty was that one might apply sanctions and restrictions on people that were even worse than having people in detention for a short period. Will the Minister confirm that we will not do that in trying to ensure that we get these sometimes quite cute people who use children as a way of getting around our laws and that we will ensure that we do not put the children in a worse circumstance?

[Baroness Neville-Jones]

My Lords, I thank the noble Lord for his kind words. The object of the exercise clearly is to alleviate the situation of children and not to make it worse. I take the point that he is making and we will look at it in our discussion of the arrangements with the stakeholders to whom we are talking.

Synthetic Biology

Wednesday 2nd June 2010 Lords Chamber

Question

15:37

Asked By

[Lord Haskel]

To ask Her Majesty’s Government whether they intend to review the regulation of synthetic biology in view of the recent creation of a synthetic organism.

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Freud)]

My Lords, the Government are confident that the majority of synthetic biology, including the recent work published in Science, is covered by existing regulations that govern work with genetically modified organisms in the UK. In the future, there is a possibility that some synthetic biology involving the creation of artificial cells could fall outside the scope of the current regulations. An amendment to the regulations is being considered to ensure that artificial cells will also be covered.

[Lord Haskel]

I congratulate the Minister on his appointment. This is his first time at the Dispatch Box answering a Question and I wish him every success. Although the Minister’s particular responsibility is welfare reform, his department deals with health and safety. As he is answering this Question, should we conclude that the Government think that synthetic biology is a risky and dangerous topic or does the Minister agree with me that there are a lot of possible benefits?

[Lord Freud]

My Lords, I thank the noble Lord for that slightly back-handed compliment. I confess that synthetic biology is not perhaps the central part of my expertise. However, I am pretty confident that the rules and regulations governing this area, which is very important for the future, are robustly under control.

[Lord Walton of Detchant]

My Lords, the achievement by Dr Craig Venter, who has synthesised a chromosome and inserted it into a cell that is subsequently capable of replication, is clearly an important scientific development. It is so important that the implications of this discovery for the future are very substantial. Bearing in mind the regulations already in existence—to which the Minister referred—would it not be wise even at this stage to invite the Medical Research Council, the Royal Society and the Academy of Medical Sciences to comment on the implications of this discovery for human and animal biology?

[Lord Freud]

My Lords, a process will start in September to look at the regulatory controls around this area. During that period, there will be a full consultation leading to changes to the regulations in order to reinforce protections, particularly around artificial cells. If all goes to plan, these should be ready by next April.

[Lord Patel]

My Lords, does the Minister agree that this is not an artificial cell in the true sense because a cytoplasm of the cell came from an organism itself? That aside, systematic biology offers great potential for developments of all kinds. First, what is at stake here is to make sure that this technology is not patented. If it is, it will give a monopoly to a lot of other systematic biology technologies. Secondly, President Obama has already set up a bioethics advisory committee to advise him on the implications of this research. Does the Minister agree that it would be a good idea to do this in our country? Thirdly, if noble Lords attend or take part in next week’s debate on genomic medicine, they might learn even more.

[Lord Freud]

My Lords, I look forward to attending that debate. As the noble Lord has pointed out, the experiment by Professor Craig Venter consisted essentially of taking the DNA from one bacterium, mycoplasma mycoides, modifying it and then putting it inside another bacterium, mycoplasma capricolum. Technically, that is not the creation of an artificial cell, but that is prospectively the next invention that could come along. That is why we need to make sure that the regulations will cover it.

I can inform the noble Lord that Craig Venter’s experiment is being patented, although observations in the scientific press indicate that that does not represent a risk of him subsequently seizing control of the whole of synthetic biology.

[Lord Mawhinney]

My Lords, I also congratulate the noble Lord on his visit to the Dispatch Box for the first time as a Minister. As a former parliamentary member of the Medical Research Council, whatever the technicalities here, can I encourage the Minister to think carefully about the proposal that the Government should consult distinguished medical, academic and, perhaps, spiritual people about the potential development of this technology at this stage rather than, as has been the case too often in the past, leaving such consultations until it is too late?

[Lord Freud]

My Lords, I thank the noble Lord for his kind words. This is an important development and the UK takes a leading role in the area. We have several research establishments right at the forefront of this development, but I would take back from him the question of whether we should look at this brave new world—if you like—earlier rather than later. At the moment these are very early days in the development of this science.

[Lord Alderdice]

My Lords, in welcoming the Minister to his position, as I do, the noble Lord, Lord Haskel, expressed some surprise that his area of responsibility was relevant. However, it may be of interest to note that the United States Congress responded immediately to this development and that it was the Energy and Commerce Committee which undertook the hearing because genome synthesis is likely to be helpful in the creation of new forms of biofuel energy. Given that, would the Minister find it helpful if your Lordships’ House were to respond in the same way by bringing together not only medical and academic research, but also the ethical and scientific wisdom that is available in this House? Indeed, I wonder if one of the committees of the House would be prepared to undertake an investigation of the kind that has been referred to. Does he think, on behalf of Her Majesty’s Government, that that would be a helpful intervention by this House?

[Lord Freud]

My Lords, formally, BIS is the relevant authority in terms of supporting this new industry, not the DWP, which is in control of the safety aspects. However, that is an interesting proposal and we shall think about it.

Commissioner for Standards

Wednesday 2nd June 2010 Lords Chamber

Motion to Approve

15:45

Moved By

[The Chairman of Committees]

That this House do approve the appointment of Paul Kernaghan CBE QPM as House of Lords Commissioner for Standards for an initial period of three years.

[The Chairman of Committees (Lord Brabazon of Tara)]

My Lords, as I announced in a Written Statement last Tuesday, a board which was convened to recommend a candidate for the post of Commissioner for Standards for the House of Lords selected Paul Kernaghan, a former Chief Constable of Hampshire. As noble Lords will recall, the creation of this post was agreed by the House on 30 November last year. I therefore beg to move that the House do appoint Mr Paul Kernaghan as Commissioner for Standards for the House of Lords.

Motion agreed.

Deputy Chairmen of Committees

Wednesday 2nd June 2010 Lords Chamber

Administration and Works

House Committee

Liaison

Privileges and Conduct

Membership Motions

15:46

Moved By

[The Chairman of Committees]

Deputy Chairmen of Committees

That, as proposed by the Committee of Selection, the following members be appointed as the panel of members to act as Deputy Chairmen of Committees for this session:

B Anelay of St Johns, L Bassam of Brighton, L Brougham and Vaux, L Colwyn, L Faulkner of Worcester, B Fookes, L Geddes, B Gibson of Market Rasen, B Gould of Potternewton, B Harris of Richmond, L Haskel, B Hooper, B McIntosh of Hudnall, C Mar, B Morris of Bolton, L Paul, B Pitkeathley, V Simon, V Ullswater.

Administration and Works

That a Select Committee be appointed to consider administrative services, accommodation and works, including works relating to security, within the strategic framework and financial limits approved by the House Committee;

That, as proposed by the Committee of Selection, the following members together with the Chairman of Committees be appointed to the Committee:

B Anelay of St Johns, L Bassam of Brighton, L Brougham and Vaux, L Cameron of Dillington, L Campbell-Savours, B D’Souza, Bp Exeter, B Harris of Richmond, B McIntosh of Hudnall, L Mancroft, L Rowe-Beddoe, L Shutt of Greetland;

That the Committee have power to send for persons, papers and records;

That the Committee have leave to report from time to time.

House Committee

That a Select Committee be appointed to set the policy framework for the administration of the House and to provide non-executive guidance to the Management Board; to approve the House’s strategic, business and financial plans; to agree the annual Estimates and Supplementary Estimates; to supervise the arrangements relating to Members’ expenses; and to approve the House of Lords Annual Report;

That, as proposed by the Committee of Selection, the following members be appointed to the Committee:

L Addington, L Baker of Dorking, L Brabazon of Tara, L Bradley, L Craig of Radley, B D’Souza, B Hayman (Chairman), B Hollis of Heigham, L McNally, B Royall of Blaisdon, L Strathclyde, L Wakeham;

That the Committee have power to send for persons, papers and records;

That the Committee have leave to report from time to time;

That the Reports of the Committee shall be printed, regardless of any adjournment of the House.

Liaison

That a Select Committee be appointed to advise the House on the resources required for select committee work and to allocate resources between select committees; to review the select committee work of the House; to consider requests for ad hoc committees and report to the House with recommendations; to ensure effective co-ordination between the two Houses; and to consider the availability of members to serve on committees;

That, as proposed by the Committee of Selection, the following members together with the Chairman of Committees be appointed to the Committee:

L Addington, B Corston, B D’Souza, L Fellowes, L McNally, B Perry of Southwark, B Royall of Blaisdon, L Strathclyde, V Ullswater;

That the Committee have power to send for persons, papers and records;

That the Committee have power to appoint specialist advisers;

That the Committee have leave to report from time to time.

Privileges and Conduct

That a Committee for Privileges and Conduct be appointed and that, as proposed by the Committee of Selection, the following members together with the Chairman of Committees be appointed to the Committee:

B Anelay of St Johns, L Bassam of Brighton, L Brooke of Sutton Mandeville, B D’Souza, L Eames, L Graham of Edmonton, L Howe of Aberavon, L Irvine of Lairg , L Mackay of Clashfern, L McNally, B Manningham-Buller, B Royall of Blaisdon, L Scott of Foscote, L Shutt of Greetland, L Strathclyde;

That the Committee have power to appoint sub-committees and that the sub-committees have power to appoint their own Chairmen;

That the Committee have power to co-opt any member to serve on a sub-committee;

That the Committee have power to send for persons, papers and records;

That in any claim of peerage, the Committee shall sit with three holders of high judicial office, who shall have the same speaking and voting rights as members of the Committee.

Motions agreed.

Gaza Flotilla

Wednesday 2nd June 2010 Lords Chamber

Statement

15:46

[The Minister of State, Foreign and Commonwealth Office (Lord Howell of Guildford)]

My Lords, with permission, I shall now repeat a Statement made in another place by my right honourable friend the Foreign Secretary. The Statement is as follows.

“With permission, Mr Speaker, I will report to the House on the events surrounding the interception of boats in the Free Gaza flotilla, the immediate action the Government have taken and our planned next steps.

In the early hours of 31 May the Israeli defence forces intercepted six of the eight boats sailing in the Free Gaza flotilla. The incident led to injury and death for a number of passengers, mainly on the vessel the “Mavi Marmara”. We await details of all the casualties and fatalities but it is clear that many will be Turkish citizens. The Prime Minister and I have spoken to the Turkish Prime Minister and Foreign Minister to offer our condolences. The six intercepted vessels were brought to shore in the Israeli port of Ashdod. Two of the boats had been delayed by mechanical difficulties and remain at sea. We believe they are en route to Gaza.

I can inform the House that it appears that a total of 37 British nationals were involved in Sunday’s events, including 11 dual nationals. We have so far received access to 28 of these individuals, one of whom was deported yesterday. We understand that four more British nationals agreed to be deported this morning and that the remaining British nationals are likely to be transferred to the airport soon. We have expressed our disappointment to the Israeli Government about the levels of preparedness on their part and the fact that we have not yet been given full information about British nationals detained and access to them. We are urgently pressing the Israelis to resolve the situation within hours.

There is real, understandable and justified anger at the events which have unfolded. The position of the Government is as follows. Our clear advice to British nationals is not to travel to Gaza. However we have made it clear in public and to the Israeli Government that we deeply deplore the loss of life and look to Israel to do everything possible to avoid a repeat of this unacceptable situation. The UN Security Council and the European Union have rightly condemned the violence which resulted in the loss of these lives. We have demanded urgent information about and access to all UK nationals involved. Their welfare is our top priority at this time, along with support to their families, who are understandably very worried. We are seriously concerned about the seizure of British nationals in international waters and this aspect of the Israeli operation must form a key part of the investigation into events.

The Prime Minister has spoken to the Israeli Prime Minister, I have spoken to the Israeli Foreign Minister and the Parliamentary Under-Secretary of State, my honourable Friend the Member for North East Bedfordshire, has been in close contact with the Israeli ambassador in London. The embassy in Tel Aviv has been in constant contact with the Israeli authorities. I am grateful to those honourable and right honourable Members who have already been in contact with the Foreign and Commonwealth Office in relation to their constituents and their families and have provided information. We recognise the intense concern for those involved and the need to keep Members updated.

Israel has told us that it wants to move as quickly as possible to deport those people from the flotilla currently held in Israel. If they agree, they will be deported very quickly. Those who remain unwilling to leave will be allowed to stay for 72 hours in detention, which is the time limit allowed for them to appeal against deportation. My understanding is that after that they will be deported. It is our understanding that the Israelis have also begun to transfer to Jordan detainees from countries that are not represented in Israel. We understand that those individuals who were allegedly involved in violence against Israeli servicemen during the boarding will have their cases examined in line with Israeli legal advice. We do not currently believe there are any British nationals in this last category, though I hope the House will appreciate that the situation is fluid.

Our partners in the international community are working, as are we, to facilitate the swift release of those detained. Turkey is sending six planes to Tel Aviv’s Ben Gurion Airport to fly out its nationals. The Turkish authorities have indicated that detainees of other countries may join these flights. We are exploring whether this is feasible for British nationals.

The UK has played its full part in the European Union and United Nations in agreeing on the need for a full, credible, impartial and independent investigation into the events. Our goal is a process which ensures full accountability for the events that occurred and commands the confidence of the international community, including via international participation. Further discussions are taking place in other international fora, including at NATO and in the UN Human Rights Council. We will take the same principled stand across all our diplomatic efforts and stress to the Israeli Government the need for them to act with restraint and in line with their international obligations given that their actions appear to have gone beyond what was warranted or proportionate. We need to know whether more could have been done to minimise the risks or to reduce the number of deaths and injuries.

The events aboard the flotilla were very serious and have captured the world’s attention. However, they should not be viewed in isolation. They arise from the unacceptable and unsustainable situation in Gaza, which is a cause of public concern here in the UK and around the world. It has long been the view of the British Government that restrictions on Gaza should be lifted. That view was confirmed in United Nations Security Council Resolution 1860, which called for sustained delivery of humanitarian aid and which called on states to alleviate the humanitarian and economic situation. That this has not happened is a tragedy. It is essential not only that there is unfettered access to meet the humanitarian needs of the Gazan people but also that the reconstruction of homes, livelihoods and trade be permitted to take place. The Palestinian economy, whether in Gaza or the West Bank, is an essential part of a viable Palestinian state that I hope will one day live alongside Israel in peace and security.

As the once-productive private sector has been decimated and ordinary Gazans have lost their jobs and incomes, it is tunnel entrepreneurs and their Hamas backers who have benefited. Hamas now has near-total control of the economy. Other groups, even more radical and violent, are finding a place amid the misery and frustration felt by a generation of young Gazans. In this context, current Israeli restrictions are counterproductive for Israel’s long-term security.

We will therefore continue to press the Israeli Government to lift the closure of Gaza. We will plan early discussions with Israel as well as our other international partners about what more can be done to ensure an unfettered flow of aid while ensuring that it reaches those who need it and is not abused. I discussed this with Secretary Clinton last night and we will take forward urgently discussions on this subject.

The House should not forget the role played by Hamas in this conflict. It continues to pursue an ideology of violence and directly to undermine prospects for peace in the region. Violence has continued in recent days, with rocket fire from militants in Gaza and Israeli military incursions and air strikes in response. We call on Hamas to take immediate and concrete steps towards the quartet principles, to unconditionally release Gilad Shalit, who has been held in captivity for four years, and end its interference with the operations of NGOs and UN agencies in Gaza.

It is today more clear than ever that the only long-term and sustainable solution to the conflict which produced these tragic events is a two-state solution that achieves a viable and sovereign Palestinian state living alongside a secure Israel, with her right to live in peace and security recognised by all her neighbours. The proximity talks that are currently under way are more important than ever. These events should not undermine these talks but instead underline just how important they are, and the Government will make it an urgent priority to give British diplomatic support to buttress that process.

The Government will continue to keep the House informed of developments”.

My Lords, that concludes the Statement.

15:55

[Baroness Kinnock of Holyhead]

My Lords, first, I thank the noble Lord for repeating the Statement. My thoughts, like those of the whole House, are with the families of those killed or injured aboard the “Mavi Marmara”. I shall attempt to keep my remarks brief to maximise the time available to hear the views from the Back Benches and to give Back-Benchers time to express their views on this tragic and deeply vexed issue.

Will the Minister give assurances that every effort is and will be made to ensure that there is safe passage to freedom for all those detained by the Israeli authorities? The UK, as the Minister has said, is in a strong position as a member of the United Nations Security Council and the European Union. I therefore seek assurance from him that the Government will continue to press for the lifting of the blockade on the people of Gaza, which is the only way in which to provide a long-term solution and meet the pressing humanitarian needs of the people. Does the Minister agree that, in line with the United Nations Security Council Resolution 1860, all access for all humanitarian and reconstruction aid should be allowed? I very much welcome the comments on this issue from the Minister, but we want to hear that that resolution will be taken into account in its entirety in the deliberations of the United Nations.

Will the Minister confirm that there is full support from the Government for the EU’s call for a full investigation? Does he agree that such an investigation can be full and credible only if it is independent and international? That is an extremely important point. We should not be fobbed off by the notion that, if it is conducted by the Israeli authorities, we can be assured of that independence and international input into the report.

Today the Irish-registered MV “Rachel Corrie” is sailing towards Gaza. On board is a former United Nations deputy security secretary-general and a Nobel laureate, Mairead Corrigan. The Irish Foreign Minister, Michael Martin, has demanded that the vessel should reach its destination unimpeded. Will the Government give active support to the call made by the Irish Foreign Minister?

All violations of international law should be dealt with thoroughly and speedily. It remains the case that laying siege to a whole population is untenable, callous and tragic, and that should be addressed by Israel and the international community. Storming a ship carrying aid is proof, if proof is needed, of the need to end the blockade. All efforts now must focus on building that peace and security which that troubled region so needs.

15:58

[Lord Howell of Guildford]

I thank the noble Baroness for her acute and expert questions. I hope that I have got them all down and that I will be able to answer all of them efficiently and effectively. Every effort will be made to obtain access to, and get the release of, all those who are detained. As the Foreign Secretary said earlier in his Statement, we think that there are no British nationals among those who have been detained or questioned under Israeli law, but the situation is fluid and I stand open to be corrected if events prove otherwise.

As the Foreign Secretary said in his Statement, we are pressing for a lifting of the blockade. This must be right; if it had not been for the blockade, we would not be facing the ugly situation that has developed. Resolution 1860 requires that all humanitarian aid should be passed into Gaza and allowed to move freely.

Of course we must respect Israel’s complete right to look after its own security and to do what it can to ensure that bombs and dangerous weapons are not also being filtered into Gaza that are then used against Israel—that is a perfectly natural and understandable stance—but that has to be consistent with allowing all other supplies, including humanitarian supplies, to get into Gaza and lift the blockade on all the normal accoutrements of daily life that the Gazan people so desperately need, including all conceivable medical supplies and food. We think that that is a wrong stance by Israel, and we urge the Israelis to change it and to abide by Resolution 1860.

We support the view of the European Union, which has not only issued condolences and taken a strong position but has called, as the noble Baroness rightly says, for an investigation that should be independent and international. We think that that is the right way to go. The United Nations Security Council has also called for an independent and impartial investigation. This must be so; obviously, if it were not of that character and quality, it would not carry any weight at all and would not be worth the effort or the paper that it was written on.

The noble Baroness asked me whether we should somehow give a fair wind to the Irish vessels that are proceeding in the direction of Gaza. Actually, we do not think that the attempt to bust the blockade by sailing towards Gaza with ships loaded in various ways is the right answer. The answer is to lift the blockade, for the Israelis to check, justifiably, that armaments are not going to be pushed into Gaza and for matters to be handled in a much more civilised way than they have been in the past week. So we think that sailing into Gaza is not the best way to try to bust the blockade, but at the same time we believe that if the Israelis interfere further with shipping, as they may well do, they should go about it in ways that are more proportionate and less obviously heavy-handed than the miserable affair in which they have become involved in the past few days.

16:02

[Lord Wright of Richmond]

My Lords, I hope that I will be allowed to add to the earlier compliments to the Minister for his position on the Front Bench and, without being impertinent, to express the hope that he enjoys his relationship with Her Majesty’s Diplomatic Service as much as I enjoyed the privilege of being a member of it for 36 years.

Does the Minister agree that one of the tragedies of this recent incident is not just that it has created further, possibly fatal, damage to the reputation and international credibility of Mr Netanyahu’s Government, but that it must have further reduced such chances that there were of moving towards a settlement between his Government and the Palestinians?

If, as we must all hope, there is now a realistic chance of lifting Israel’s inhuman and unacceptable blockade of Gaza, I hope that the Minister will be able to reassure those of us who have long argued for contacts with the elected authorities in Gaza that the coalition is now prepared to open talks with those authorities, if only to be able to help facilitate the introduction of necessary and vital supplies to alleviate the suffering and unemployment of the people of Gaza. Of course we should not ignore the role of Hamas in launching attacks against Israel but does the Minister agree that, in almost every case, offers of a ceasefire from Hamas have been broken on the Israeli side?

I hope that the Minister can also reassure the House that the Government will continue to press for an end to the illegal colonisation of the West Bank and the eviction of Palestinians from their homes in east Jerusalem.

[Lord Howell of Guildford]

I am extremely grateful to the noble Lord for his kind remarks. I am sure I will enjoy working with the diplomats, though I may not agree with every nuance of diplomacy. I see my job as not only to represent the Foreign and Commonwealth Office in your Lordships’ House, but to represent your Lordships’ views in the Foreign and Commonwealth Office. We have to get to the truth of what happened. It is still obscure as to how this came about, although there are some very ugly realities that we have all seen on television. I would not be quite as gloomy as the noble Lord about the future; it could be that this ugly event has jarred people into a new realism. Mahmoud Abbas has already said he believes that we should press ahead with the proximity talks. I think that is right.

The noble Lord went on to talk about whether the coalition Government should talk to Hamas about such detailed practical matters as the release of personnel. Officials have had to talk to Hamas but the Government do not believe that we should talk to Hamas until it is prepared to take concrete steps some degree in the direction of the quartet’s proposals. So far, it has shown that it is not prepared to take those concrete steps. When it does, the situation could change. Until that is so, that is the position of the coalition. I hope that answers the specific questions of the noble Lord. I agree with his broader proposition that the day must come when there is a Palestinian state, many of the present trends are reversed and these two nations can live side by side in security and peace.

[Baroness Falkner of Margravine]

My Lords—

[Lord Janner of Braunstone]

My Lords—

[Baroness Anelay of St Johns]

My Lords, I think the House wants to hear from the noble Lord.

[Lord Janner of Braunstone]

I thank the noble Baroness for that. I join in expressing deep sorrow at the awful sadness that this event has created on all sides. It is very tragic. The question now is: how do we get a peace programme that helps ordinary people and isolates extremists? I suggest that our Government should join the quartet and host a conference in London with the Israelis to discuss the easing of restrictions on goods to be allowed into Gaza. I trust the noble Lord will agree with me that neither Israel nor the international community should engage with Hamas in any way until it renounces violence and accepts Israel’s right to exist.

[Lord Howell of Guildford]

I understand the noble Lord’s expertise and the way he fights for what he believes to be the right causes in this difficult and tragic area. However, I have already made clear at the Dispatch Box the Government’s views about talks with Hamas. I do not have anything to add to that.

[Baroness Falkner of Margravine]

My Lords, I thank my noble friend the Minister for his comprehensive Statement, which sets out the Government’s position in some detail. I particularly welcome page 5, which refers to the blockade, rather than retaining the focus on the specific issue of this flotilla. That is very welcome. Is it the Government’s opinion that the legal status of the blockade is defensible in international law? It seems to me that blockades can take place only in emergencies; four years is rather a long time for a state of emergency to continue.

Picking up the point made by the noble Baroness, Lady Kinnock, on the “Rachel Corrie”, I heard what the Minister said about not necessarily providing safe passage. However, in calling for an international and credible investigation, will Her Majesty’s Government also be prepared to press that the investigation should look into the allegations of sabotage against the “Rachel Corrie” and its sister ships? It would be very serious if the Israeli Government were acting on several different fronts to undermine the passage of humanitarian aid.

[Lord Howell of Guildford]

I am grateful to my noble friend for those questions. On the legal status, United Nations Resolution 1860 is pretty clear that the blockade should be lifted. I do not want to tread into the niceties of international law beyond that but, given that the United Nations and the international community have said what they have, Israel must be getting very near illegality in maintaining such a vicious blockade, which clearly has such bad effects in humanitarian terms. We believe that it should be lifted. We cannot see that it is doing Israel any good and it is not doing the situation any good, so it should go. As to the sabotage of ships that my noble friend mentions, the trouble is that many issues and questions are flying round. For example, were these ships sabotaged? Did two of them have to stop in Cyprus? Why were there 400 or 500 so-called activists on a ship if it was meant to be carrying humanitarian materials? Perhaps it would have been better to carry those materials than so many bodies. All sorts of issues are not straight at the moment and need to be looked at in the investigation, but that certainly is one of them.

[Lord Campbell-Savours]

Do the Government rule out punishment of the state of Israel in all circumstances in the event that it is found guilty on these matters?

[Lord Howell of Guildford]

That is one step down the line. The first thing is to find out what happened, who is guilty and whether we are looking at a botched operation by the Israeli elite corps, as most people in Israel are admitting, or whether we are looking at crimes that require punishment. That lies far down the line, so I do not think that this is a time for ruling in or ruling out.

[Lord Pannick]

The Minister said that there must be an international inquiry. Does he accept that there is every reason for confidence that an inquiry conducted by an Israeli judge—should the Israeli Government proceed along that route—would be independent and thorough, given the well deserved reputation of the Israeli judiciary for independence and protecting the human rights of all those whose interests have been considered by the Israeli courts? Is the Minister aware that the criticisms of these unhappy events from outside Israel are loudly echoed within Israel by many politicians and by large sections of the press and the public? Has he seen the editorial and other articles in yesterday’s well respected Haaretz newspaper, the flavour of which is given by its headlines, “The price of flawed policy”, “A failure any way you slice it” and “Bibi the schlimazel”—that is, a person who stumbles from one calamity to another?

[Lord Howell of Guildford]

I am very grateful to the noble Lord, who is a considerable authority in this area. He is absolutely right about the Israeli judiciary and the quality of judges. What he says will have to be determined when it comes to the investigation. I have read extracts from editorials in Israeli newspapers. The noble Lord is right to say that many wise and highly intelligent Israelis are questioning whether the present policy—not only in relation to this matter but generally—is the right one for the security of Israel. I believe that the security of Israel is vital and should be pursued by somewhat wiser and more subtle policies than those being followed at present.

[Lord Clinton-Davis]

I acknowledge that this act should never have occurred, but does the Minister agree that a state of war frequently leads to a horrendous and unlawful situation and that this is no exception? Does he also agree that humanitarian supplies should be conveyed to the people of Gaza at this time? However, is it not equally important, as the noble Lord said, that the illegitimate and provocative behaviour of Hamas in Gaza should cease? In no way can it contribute to a peaceful solution to this issue.

[Lord Howell of Guildford]

My Lords, of course I agree with both those wise propositions. The rocketry must cease and that would begin to open the way to better things. Obviously, as the noble Lord says, war leads to the most terrifying, terrible and horrific situations and violence. We all recognise that. The sooner we can bring peace, instead of this horrific situation, the better.

[The Lord Bishop of Ripon and Leeds]

My Lords, will the Minister comment on the role—actual and potential—of Egypt in finding a solution to the immediate and longer-term issues? Egypt shares a border with Gaza. Have the Government been in touch with the Egyptian Government? What fruitful ways forward do they see in that relationship?

[Lord Howell of Guildford]

I shall have to check on whether we have been in touch with the Egyptian Government. Obviously, the Egyptians are very much part of this story. They have very recently removed their part of the blockade on Gaza. More generally, we are hoping for a more positive and active role in this whole area by Egypt, which is an enormous country, than we have seen in the recent past. This may be because the Egyptians face certain internal problems, but a more active role by Egypt and the regional partners generally in this whole affair would be very welcome indeed.

[Lord Cope of Berkeley]

My Lords—

[Lord Elystan-Morgan]

My Lords—

[Lord Grocott]

My Lords—

[Baroness Anelay of St Johns]

My Lords, perhaps I may assist the House. I do not think that we have yet heard from a Conservative speaker. I know that my noble friend Lord Cope of Berkeley has been trying to intervene.

[Lord Cope of Berkeley]

My Lords, in his Statement, my noble friend spoke of the possibility that some of those aboard this ship may be charged with offences against the Israelis who boarded it. What right would Israeli courts have to try anyone for offences apparently committed in international waters on a Turkish ship? What on earth would be the jurisdiction of the Israeli courts over any such offence?

[Lord Howell of Guildford]

That raises the broader question as to whether the operation in international waters was legal and covered by the provisions of war or whether it will turn out to have been illegal. Obviously, the Israeli authorities consider that those individuals who they believe took violent action against the people parachuted on to the deck of the “Mavi Marmara” are people who attacked their soldiers and should be charged. That is the view of the Israelis and, although we may think that other issues should be resolved first, the Israeli authorities clearly wish to examine whether these people who attacked their soldiers should be charged.

[Lord Elystan-Morgan]

My Lords, while the whole House would deplore the frightening loss of life, both in relation to the Gaza flotilla and in relation to tunnellers killed over the past few weeks on the Egypt-Gaza border when seeking to break through to Gaza, is it not the case that both sovereign states of Israel and Egypt are, as a matter of general precept, within the bounds of international law in seeking to prevent the supply to Hamas of material of a military, or potential military, nature? Having said that, one appreciates that such actions have to be proportionate and reasonable when policing such a privilege.

[Lord Howell of Guildford]

I am sure that the noble Lord is right but, as my right honourable friend pointed out in his Statement, it is precisely the completeness of the blockade in blockading not merely weapons but all other supplies that has given birth to the tunnel arrangements and the kind of black-marketing and control of trade that have poisoned the whole Gaza scene. If the blockade were lifted, the case for the tunnels would disappear.

[Lord Grocott]

My Lords, I welcome the Government’s clarity and robustness, first, in saying that the inquiry must be seen to be absolutely independent and rigorous and, secondly, in saying that the blockade must be lifted. The Minister said—I am not sure how precisely he intended that the word should be interpreted—that the blockade must be ended by “civilised” means. We all agree with the word “civilised”, but it does not demonstrate the urgency that is needed in the lifting of the blockade, as we remember the unremitting and continuing suffering of innocent people in Gaza, who as recently as 18 months ago lost 400 of their children in a war. The international community must address the lifting of the blockade as a matter of urgency.

[Lord Howell of Guildford]

I agree with that and hope that nothing that I said earlier contradicts that view. Israel must urgently find and adopt a better way of limiting any arms and bombs going into Gaza, while at the same time providing for the needs of the people of Gaza, which are desperate and urgent. It is also urgent that the Hamas rocketeers stop firing rockets into Israel. I used the word “civilised” to indicate that, if both sides move away from this violent brutality, we will get urgent progress.

[Lord Phillips of Sudbury]

My Lords, the Minister referred to the rockets fired from Gaza into Sderot and other places. I urge him to listen to the point made by the noble Lord, Lord Pannick, and to the quarter or third of the population of Israel who view Israel’s strategy and policy, in particular the colonisation of the West Bank, as being totally self-defeating for its long-term security, totally abhorrent in terms of human rights and totally against international law. I was in Gaza in January, for the third time in eight years. Some debates that one listens to in this Chamber—I mean no disrespect to any noble Lord—seem to be based on a misunderstanding of the abjectness of the condition of not only the Gazans but also the people in the West Bank and of the ritual, systemic humiliation and violence to which they are subject. It is all very well talking about a few home-made rockets—and I do not defend them—but there is an occupying army in the West Bank and there was a pulverisation of Gaza a year ago, in which 1,400 people were killed as against 13. I urge the Government to get real about these issues and not to pretend that there is parity between one side and the other.

[Lord Howell of Guildford]

I think that my noble friend’s views are very widely shared. I listened carefully to the noble Lord, Lord Pannick, who rightly said that there are a large number of people within Israel, as well as among those who look on and admire Israel from around the world and believe that it has every right to exist as a nation in security, who feel that its present policies are certainly not achieving that aim.

Arrangement of Business

Wednesday 2nd June 2010 Lords Chamber

Announcement

16:22

[Baroness Anelay of St Johns]

My Lords, 55 noble Lords have signed up to speak in today’s debate. If Back-Bench contributions are kept to five minutes, the House should be able to rise at around our normal target time of 10 pm.

Queen's Speech

Wednesday 2nd June 2010 Lords Chamber

Debate (4th Day)

16:23

Moved on Tuesday 25 May by Earl Ferrers

That an humble Address be presented to Her Majesty as follows:

“Most Gracious Sovereign—We, Your Majesty’s most dutiful and loyal subjects, the Lords Spiritual and Temporal in Parliament assembled, beg leave to thank Your Majesty for the most gracious Speech which Your Majesty has addressed to both Houses of Parliament”.

[Baroness Wilcox]

My Lords, it is a great privilege to open this debate on Her Majesty’s gracious Speech. I thank my noble friend Lord Henley, who will be winding up today. He is no stranger to being a Minister, and I am extremely grateful for his experience.

Our discussion will cover business and economic affairs, the environment, energy, agriculture and transport. These issues are essential to securing Britain's economic recovery and global success in the future, and the gracious Speech supports the Government’s ambitious agenda decisively to tackle Britain’s deficit, to address the fundamental causes of the financial crisis, to build a sustainable private sector recovery that is balanced across all regions and industries, to promote resource sufficiency and the protection of our environment, and, finally, to secure the right mix of public and private sector investment to modernise Britain’s infrastructure.

The Government’s most immediate task must be to reduce Britain’s record deficit. According to the IMF and the European Commission, this year it is set to be the largest in the G7 and the European Union. The Government are borrowing £1 of every £4 they spend, which is a drag on our people’s ambitions and efforts to foster growth.

The Government must take action now. With the support of the Bank of England and based on analysis from the Treasury, we have identified and committed to cut more than £6 billion of wasteful spending across the public sector. Focused on protecting the vulnerable and maintaining the quality of our front-line services, these measures will increase efficiency and value for money, and enable government to reinvest part of these savings in Britain’s long-term growth.

Wider reform is also needed to boost credibility and trust in the UK’s fiscal framework and financial regulatory system. With its statutory responsibilities enshrined in the budget responsibility Bill, the new Office for Budget Responsibility will make an independent assessment of Britain’s public finances and economy, putting us at the forefront of international best practice.

The Government’s budget forecasts over the past decade have underestimated borrowing compared with independent forecasts. On average, in that same period, their forecasts for economic growth have also been out by £13 billion. An independent Office for Budget Responsibility will ensure that policy is developed based on a more accurate picture of Britain’s public finances and prospects. Its first findings will inform the emergency Budget on Tuesday 22 June and future fiscal events.

Out of the millions of words written about this financial crisis, its causes are clear: reckless lending, excessive borrowing and poor financial regulation. Breeding confusion over the roles and responsibilities of its authorities, the current tripartite system—the Bank of England, the Financial Services Authority and the Treasury—has failed to do its job. We need to learn from these mistakes.

The Government believe that the Bank of England, with its clear remit for monetary policy, is best placed to strengthen the link between financial stability and macroeconomic policy and, as a result, monitor and manage risks and imbalances in our economy. The financial reform Bill will give the Bank of England the control to do just that.

The Government are also developing measures to establish a more stable and effective banking system and ensure that profitable businesses, especially small and medium-sized enterprises, can access the credit they require to succeed. Ultimately, it is these businesses that will generate the growth and innovation that we need but, to do that effectively, government must promote, not stifle, their enterprise. Our Government are committed to developing a new model for the British economy—one that is balanced across all regions and sectors, supports sustainable growth and enterprise, works with rather than against the natural environment, and enables us to seize market share in leading global industries such as low-carbon.

That demands that we set out a clear vision of how Britain needs to earn its living in the future and deliver the open, competitive business environment, skilled, flexible workforce and cutting-edge infrastructure needed to make it happen. To do that, the Government are working to free small and medium-sized businesses from unnecessary regulation, cutting through the burden of red tape that holds them back, and making it easier for entrepreneurs to start a new business.

We are reforming our tax system so that it is simpler, fairer and more competitive. As part of this work, the national insurance contribution Bill will bring forward necessary changes to safeguard jobs and support the economy. We also want to increase the potential for SMEs to sell their high-tech products and services around the world and to win public sector contracts. We will also make it easier for small businesses to do business with government by making opportunities easier to find and by simplifying and streamlining the procurement process.

We shall also work with our universities and colleges to strengthen their links with industry and ensure our people have the skills they need for the jobs these companies create. In addition, we will remove barriers to flexible working, helping businesses to recruit and retain talent and enabling individuals to balance work demands with their family responsibilities. In the coming months, we will consult fully with business and families to identify the best way to introduce this change.

Finally, to thrive, every modern business needs access to cost-effective and reliable energy, transport and communication networks.

In each of those areas, new technologies and the demand for sustainable solutions present us with significant challenges and opportunities. In energy and environment, we need to tackle climate change; use our natural resources more effectively; secure low-carbon energy supplies; and cut our carbon emissions. In the long term, economic growth depends on the raw materials provided by our environment and it is crucial that we gain a better understanding of their value and how we can best manage them in the decades to come. The Government will, therefore, introduce a natural environment paper, the first since 1990, setting out a new, more integrated strategy to the management of our natural environment, including action to protect wildlife and increase biodiversity. The Prime Minister has said he wants this Government to be the greenest ever, both in terms of action at home and internationally. If we succeed, the potential prize for Britain’s people and businesses is thousands of new green jobs and a lucrative share of the growing market for environmentally sustainable technologies, goods and services.

To ensure the finance is available to help us make the most of that opportunity, the Government are creating a green investment bank and will develop new green financial products and a range of wider measures. The energy security and green economy Bill is a key part of that programme, providing the right legislative framework to deliver a successful low-carbon future for Britain. To do so, it will help to increase energy efficiency in our country by enabling a pay-as-you-save approach. Our green deal will enable householders to benefit from efficiency measures and repay the cost of this work over time through energy bill savings, rather than having to spend large sums of money upfront.

As well as reducing carbon emissions and household energy costs, this green deal will support a green recovery. It will drive the creation of more green jobs, alongside clear quality standards and help green industries and expertise in this country to grow. Subject to detail and any necessary legislation, further measures may include energy market reform to secure our energy supplies and shift to low-carbon sources—that is in addition to our work with Ofgem to develop a security guarantee for our energy supplies; the introduction of an emissions performance standard to regulate the emissions from coal-fired power stations; a requirement for energy companies to provide more information on energy bills, empowering customers to make the right green energy choices for them, including information on the cheapest tariff available and useful comparisons of energy usage; and, finally, a framework for the development of a smart grid to revolutionise the management of supply and demand for electricity in Britain’s low-carbon future.

Some have queried why there was nothing in the gracious Speech on nuclear power. Quite simply, there is no need for a new Bill in order to bring forward new nuclear. The Government are committed to allowing the construction of new nuclear power stations provided they receive no public subsidy and, through the Office for Nuclear Development, we will continue to drive forward the actions needed to remove unnecessary obstacles to the deployment of nuclear power. This includes the completion of the draft nuclear national policy statement to be tabled in Parliament.

Also central to our low-carbon future is the creation of a modern, sustainable transport system for Britain. We have already made it clear that we do not support the construction of a third runway at Heathrow, or any plans for new runways at Stansted and Gatwick. We want to make Heathrow better not bigger, and to boost the performance of our airports for the people who use them.

Improving the framework for airport economic regulation is vital to this. And we will reform existing arrangements for setting price caps at airports to establish a more flexible framework focused around passengers. In addition, we are committed to establishing a high-speed rail network. Our vision is for a truly national network linking our major cities and including links to Heathrow and potentially other airports. In this way, high-speed rail could provide an attractive alternative for journeys which might otherwise be served by short-haul aviation.

In due course, we propose to seek powers to deliver the first phase of that network through a hybrid Bill later in this Parliament. But substantial work is needed ahead of this, and we will continue to develop our proposals. This includes carrying out a full and open public consultation with those who may be affected by any high-speed line.

Every day, new technologies are revolutionising how businesses connect with their customers and people communicate. Unsurprisingly, this has had a radical impact on the business of the Royal Mail. The postal services Bill will seek to tackle the fundamental and long-standing problems facing this organisation in a modern communications environment. It will aim to enable the Royal Mail to benefit from private sector disciplines and capital, including possible opportunities for employee ownership, ensure the continued provision of a universal postal service and safeguard the future of the Post Office network.

Also, as other countries roll out next-generation high-speed broadband, the Government will be looking at ways to enable a strong, market-led approach to its deployment in this country, ensuring that people and communities in rural, as well as urban, areas can benefit from this technology and businesses across the country can compete. Just as any family or successful business knows, it is taking a big risk on its future with too much debt—Britain cannot build its recovery without urgent action to reduce the deficit, increase market confidence and restore balanced, sustainable growth to our economy. The gracious Speech sets out and supports our Government’s measures to make that happen and sends a strong message that Britain is open for business.

We will have the talent, the technology and the tolerance to take our country forward. We will remove the over-restrictive ties that presently bind us; protect the vulnerable; and revel in the freedom that our unwritten constitution has given us and that has allowed this exciting journey to new politics, which our people have faith in us to begin. I look forward to our debate on these important issues.

16:37

[Lord Myners]

My Lords, I begin by congratulating the noble Baroness, Lady Wilcox, on her appointment to government. This must be the first time in many decades—possibly ever—that part of the debate on the humble Address has been led by two people of Cornwall. I also compliment the noble Lord, Lord Henley, on his return to the government Benches.

This will be my last contribution from the Opposition Front Bench, as I move to the Back Benches to make room for colleagues more skilled in the art of politics and opposition. I should therefore like to use the occasion to express my appreciation to the noble Baroness, Lady Noakes, for the detailed focus she brought to shadowing me when I was in government. I should also like to record my thanks to the noble Lord, Lord Newby, who introduced great vision and wisdom to our debates. And of course I should like to register my most sincere gratitude to my noble friends for their patience and support over 18 months. Finally, like others, I look forward to welcoming Sir James Sassoon to the House and to the Benches opposite. His experience of the real world will be indispensible to his new colleagues.

I will focus my remarks today on matters relating to the economy, public finances and the financial sector, because everything else depends upon this. My colleague, my noble friend Lord Young of Norwood Green, will also speak to these subjects and other matters in his closing speech.

The Labour Party lost the general election. We need to reflect on the reasons for our failure and develop a set of coherent proposals which will appeal to the aspirations of the broader electorate. We should be proud of many of our achievements while in Government, but we need to recognise that jobs cannot be created by interminable meetings in the COBRA war room. Government needs to work with the grain of the private sector, creating a pro-enterprise context with the right incentives and rewards for success.

We now need to focus on the challenges and responsibilities of effective opposition. We will not oppose for the sake of it; nor should we oppose proposals from the Government which we would have made had we been re-elected. For instance, I do not see why we should take issue with the intention behind the Equitable Life Payments Scheme Bill or the Terrorist Asset-Freezing Bill, although we will of course scrutinise the detail.

We will be vigilant in our analysis of and response to government proposals which we judge to be unfair, damaging to essential public services or injurious to jobs and business. We are told that the Government's legislative programme will be based on the principles of freedom, fairness and responsibility. The Queen's Speech tells us nothing about how the new Government will resolve the inevitable tensions between those fine words. We will be testing the Government against those principles. The Queen’s Speech is where the “dignified” part of the constitution passes to the “efficient”. The Government have been clear that in their view, to cite the coalition document,

“The deficit reduction programme takes precedence over any of the other measures”.

The Opposition do not dissent from the view that there needs to be a clear path to sustainable government funding, including a significant reduction in the public sector deficit, but we question the timing and pace of the deficit reduction programme. The risks of moving too soon or too late are not symmetrical. Over-hasty action will push the economy back into recession and a ballooning rather than a contracting of the deficit. That was the view of the Liberal Democrats until three weeks ago.

The economy is showing signs of recovery from the global recession, supported by the previous Government’s stimulus package, but private sector consumption and investment are still too anaemic, in my judgment, to make up for a very sharp fiscal tightening. The output gap, or excess capacity, is already in excess of 5 per cent of GDP. Any contraction in aggregate demand will be reflected in increased unemployment, loss of people's homes and business failure.

It has been entirely right and proper in the circumstances that the Government continued to support economic activity through a targeted programme of expenditure designed to protect the most vulnerable and facilitate the return to growth. This should continue until the private sector demand and investment process recovers. Our action in that respect in 2008-09 achieved a considerable measure of success, particularly compared with the experience of Tory recessions in the 1980s and 1990s. The strategy that we followed was sensible and well within the Government’s financing capabilities. Real yields on gilts are below 1 per cent, and nominal yields are below 3.5 per cent. The ratio of gross debt to gross domestic product is below that of all our major competitors, and still below the long-term average for the UK. The average maturity of our debt is more than 14 years. The private sector is currently running a surplus that represents nearly nine-tenths of the fiscal deficit. We must not lose sight of the interaction between the private and public sectors in terms of deficits and surpluses.

Fiscal tightening will work only if it coincides with a robust private sector recovery. If that is not the case, the Government's action will drive the economy back into recession with an increasing public sector deficit. In such circumstances, dogma and intransigence will be pursued at very real cost to people's lives. Recovery cannot be taken for granted, particularly if the public and private sectors here and overseas are engaged in simultaneous and unco-ordinated balance sheet adjustments. It is incumbent on the new Government in this respect to follow the lead set by their predecessor in shaping and influencing international co-operation on economic management. The new Chancellor will have his first test this weekend at the G20 meeting. We look forward to receiving his report.

I referred earlier to the position that Liberal Democrats took during the election campaign on the need to eschew early or harsh spending cuts. Mr Nick Clegg, the Deputy Prime Minister, justified his change of position in supporting George Osborne's spending cuts, having opposed them during the election, by saying on the “Andrew Marr Show” on BBC1 on Sunday 23 May:

“I don’t think anybody could have anticipated quite how sharply the economic conditions in the Euro zone would have deteriorated, and the need to show that we are getting to grips with this”

the deficit—

“suddenly becomes much greater”.

I look forward to hearing the views of the noble Lords, Lord Desai and Lord Skidelsky, on this arrant nonsense. European economies—our principal export market—are weakening. Gilt yields have fallen, signalling a sense of heightened anxiety about growth and risk, as further evidenced by increased risk tendencies within the banking sector. Sterling is strengthening, yet our Deputy Prime Minister now believes that these circumstances justify the introduction of measures that will weaken demand and that are likely to be harsh and regressive in their impact on our economy and society.

The coalition Government need to spell out those parts of the economy that they have identified as the engines for growth in 2010-11. What will act as a catalyst for an improvement in the private sector? What will improve demand and investment when so many countries are in retrenchment? The Minister talked about a balanced economy. How do the Government intend to balance the economy? What do they intend to suppress in economic activity? What activities do the Government wish to see diminish in importance in our economy? It is certainly most odd that in these circumstances Mr Osborne should have chosen last week to give high priority to reducing business support schemes and that Mr Cable should have failed to make the case for business. Perhaps Mr Cable has concluded that he is powerless to challenge Mr Osborne.

The Minister referred to wasteful expenditure. We are all in favour of cutting waste, but cancelling 10,000 university places is not cutting waste; it is cutting our capacity for the future. Cancelling 40,000 jobs for young people under the Future Jobs Fund is not cutting waste; it is blighting prospects. Cutting child trust funds is hitting the poorest and has no impact on public expenditure, as the assets within those funds have to be retained within the banking system.

The noble Lord, Lord De Mauley, last week failed to provide any credible answers to questions from my noble friends Lord Eatwell and Lord Kinnock on the impact of the Government’s announcement on unemployment, business failures and the cost of breaking long-term contracts. The noble Lord said that today’s debate would afford ample opportunity for answers to those questions. I heard not a single answer from the Minister to those questions. It is my sincere hope that Ministers will provide answers in the closing speech or by letter to those participating in this debate. I have no doubt that the answers exist within the Treasury, although they were clearly not shared with the noble Lord, Lord De Mauley, ahead of last week’s debate. When I sat on the Benches opposite, I made real efforts in my closing speeches to answer questions raised in debate, and when I was unable to do so, I tried to answer them as fully as possible in correspondence with noble Lords who participated in the debate. If I was slow in replying, I could always rely on the noble Lord, Lord Marlesford, to chase me. I hope that Ministers participating in this debate will respect the House by following the same practice.

A core element in the Government’s legislative programme is the establishment of the Office for Budget Responsibility to provide confidence in the management of public finances. We must wait to see whether this is a triumph of spin over substance. The independence and credibility of the OBR is hardly helped by the suggestion that it will be able to provide independent and credible economic forecasts ahead of the Budget in three weeks’ time. The OBR’s wish to accommodate the Chancellor by agreeing to such a rushed piece of analysis does not auger well. I do not have concerns about or issues of principle with the OBR. It could possibly be a useful addition to transparency and accountability, although the IMF’s cool reaction to the proposal suggests that we should not raise our hopes. But I have questions of detail to which I seek answers. How will the OBR be staffed? Will it have its own independent forecasters, or will it rely on Treasury officials? What resources will be allocated to the OBR, and will they be determined by the Chancellor? What savings in Treasury costs will arrive with the establishment of the OBR? How much time will it have to review Budget proposals before it publishes its commentary on them on 22 June? Sir Alan Budd appears well qualified to chair the OBR, but he is a political appointee, made while the Tories were in opposition in 2009. Will OBR appointments be in accordance with best practice and in open competition, without ministerial or special adviser involvement? How much will Sir Alan and his colleagues be paid? Sir Alan has recently worked for a well-known hedge fund and speculator. Has he now terminated all links with this group, which is led by a well-known Tory donor, or is there an arrangement for him to return to the group on completing his appointment at the OBR? I ask the same question about Mr Geoffrey Dicks and Novus Capital. When did Sir Alan and Mr Dicks last advise their clients and associates on public finance issues? Have they had any contact with these firms since the election?

Critically, we will expect the legislation that establishes the OBR to make it clear that this body should be independent of the Treasury, fully accountable to Parliament, and transparent in its processes—including publishing minutes, as we did in respect of the Council for Financial Stability. The key word in the OBR’s title is “responsibility”. Let there be no doubt that the Chancellor must continue to take responsibility for tax and spending decisions. He cannot evade them or use the OBR, or Mr Danny Alexander, as a human shield. Sir Alan will need to be careful not to be drawn into politics.

The OBR has little time to prepare its economic forecast and review the proposals that the Chancellor will announce to the other place on 22 June. It is clear that we will see draconian cuts in expenditure that will include the front-line provision of critical services. Taxes, particularly VAT, will also rise. Tax bands will be frozen and benefits cancelled or reduced. Anticipation of these cuts is already sapping consumer confidence, and businesses are placing new investment on hold until they see how bad things are going to be.

We can, however, take some encouragement from the moderating influence of the Liberal Democrats, who are deeply embedded behind lines in the coalition, as already evidenced in the cancellation of plans for raising the threshold for inheritance tax and in the proposed changes to capital gains taxes to bring them closer to the income tax rates. We congratulate the Liberal Democrats on their influence on the Conservative Party in this respect. Raising tax thresholds and the capital gains tax rate is a well argued Liberal Democrat priority, although I note for the House that in previous Budgets we judged it important when in government to encourage capital investment and business creation through low rates of taxation on capital gains. I look forward to hearing the Government’s explanation of their thinking behind increasing capital gains tax rates. The Liberal Democrats made great play in their election pitch about closing tax loopholes and frustrating tax avoidance, particularly in the banking sector. Will Ministers confirm that this is a high-priority action for the new Government and let the House know the actions that they are taking?

Let me now spend a moment on the banking sector. I sense that the European banking sector is moving towards a very difficult space, with heightened risk manifesting itself in wider credit spreads and a reluctance to do business with an increasing number of professional counterparties. This is similar to, although not as extreme as, the conditions that prevailed in 2008. This new Government must now exercise great care if we are to avoid a further banking crisis. The Government have proposed establishing an independent commission to investigate the complex issues of separating retail and investment banking. I wonder whether Ministers can cite a single example of this factor having a bearing on the failure of any UK banking institution, and I look forward to the answer from the noble Lord, Lord Henley, to that question.

From my experience, the failures of RBS and others were down to poor credit judgment, poor management and poor governance. Universal banking was not a causative factor. Yet the establishment of this commission is causing the banking sector considerable alarm, as is Ministers’ talk of the Government forcing banks to lend regardless of their commercial judgments of risk. The uncertainty that is being created is leading banks to review their lending commitments until the Government are clear about their intentions. This contraction of credit is another force that pushes the economy back towards recession. Will Ministers tell us when we can expect a comprehensive statement on this commission, and their policy thinking behind obliging banks to lend?

It is unfortunate that the uncertainty created by the new commission must now mean that the Government are not in a position to realise the full value of the investment taxpayers have made in Lloyds Banking Group and RBS. The taxpayer currently has a substantial gain from the aggregate interventions made by the Treasury and the Bank of England in 2008-09—something well in excess of £10 billion of gain as a consequence of well structured programmes of intervention and support. UK Financial Investments had well developed plans to work towards sales, which I imagine must now be postponed while this review is carried out, with the risk that the opportunity for gain will pass.

Finally in respect of banking, the new Government have talked of robust action on bonuses. Can Ministers explain what they have in mind and how their thinking in this area and their proposed actions differ from the actions of the previous Government? Are they considering the introduction of a special tax or a higher rate of corporation tax for those banks, or some direct involvement in decisions about remuneration? If they are going to do this for the banks, will they do it for insurance companies, hedge funds and others who compete with the banks? There is complete uncertainty here because of the lack of clarity about the Government’s intention. The time has passed for the Government to be vague about this. We need clear statements if uncertainty is to be addressed.

The Government are also proposing changes to the structure of banking supervision. Their thinking here is confused and the wisdom of making wholesale changes to the regulatory architecture must be very questionable at a time when the world’s banking system is showing loss of confidence. The Government talk about bringing forward proposals to give the Bank of England control of macro-prudential regulation and oversight of micro-prudential regulation. When can we expect to see these proposals? Do they accord with the wishes and recommendations of the Bank of England? Does the Bank of England have the capability to perform these new roles or will people need to be recruited—possibly, ironically, from the FSA? When does oversight move to control? When does micro morph to macro?

In respect of macro-prudential regulation, will the Bank of England seek to influence market values of homes, property and businesses? Will it have powers to ration lending? How would those powers operate given the global nature of banking and financial markets? Will this macro-prudential regulation be co-ordinated with the work of the OBR? On these subjects, the Government are absolutely silent. How will the Bank manage the potential conflicts between its role in determining the price and availability of money, and its new responsibility for micro-regulation, where these two may move it in opposite directions? There is no clarity on these issues in the Government’s thinking at all. We look to the noble Lord, Lord Henley, to provide that clarity. I mentioned governance earlier. I hope that the new Government will continue to promote the cause of good governance and stewardship, and ensure that the UK continues to lead in this important area.

I have little time to comment on other matters in the Queen’s Speech, but I would express my general support for the intention to give all employees the right to request flexible working hours and the promotion of equal pay—two policies where the influence of the Liberal Democrats is again very clear. The same could be said for the enthusiasm with which the Government are proposing to focus on legislation to take action on climate change.

The Liberal Democrats endow the Government with a more caring complexion than would have been the case if the Conservatives had governed alone. The new Government are coming together impressively at ministerial level but the debate on the humble Address has already exposed Back-Bench tensions that will need to be managed.

For our part the Queen’s Speech contains a number of measures which we will wish to support, subject to detail. But there are other areas where thinking is simply flaky or reckless—areas where the interests of economic prosperity and stability are subserviated to dogma, blindness to risk and the hazards of foolish action. The Government can expect us to be unstinting in our opposition to such measures.

16:58

[Lord Bilimoria]

My Lords, I congratulate the Minister on her appointment. We have all witnessed the hard work that she has put in in this area. I also congratulate the noble Lord, Lord Henley.

Today, we have a huge public sector debt and a huge deficit. Working-age employment is at its lowest level since 1996 and we have over 5 million out-of-work benefit claimants. We are one of the most highly taxed economies in the world and Europe is on the brink of disaster. The previous Government blamed our crisis on the global situation and now the current Government are blaming the previous one for everything. Surely we have had enough of the blame game.

Being out of the euro has saved the British economy from being added to the list of the PIGS countries. For the euro to be truly effective, I believe that you need political, emotional and economic alignment. In reality, countries set their own fiscal measures, there is no emotional commitment and, as we know, there is no economic alignment—just look at Germany and Greece. Thanks to being out of the euro, we have not been straitjacketed by the euro interest and exchange rates. I am all for keeping a mutually beneficial relationship with Europe as a trading partnership.

On the subject of trading partners, I am absolutely delighted that the enhancement of the UK’s partnership with India was mentioned by Her Majesty in the gracious Speech. I agree with Larry Summers, who said that,

“the dramatic modernisation of the Asian economies ranks alongside the Renaissance and the Industrial Revolution as one of the most important developments in economic history”.

I am proud to be president of the UK India Business Council, supported by UKTI. India’s economy has grown by over 6.5 per cent while we have been in recession. British business, in particular our SMEs, could be doing so much more.

The coalition Government’s move to reverse the national insurance increase is welcome; according to the FSB, it will help to protect 57,000 jobs. On the other hand, the 50p top tax rate, the non-dom levy and the proposed capital gains tax increases not only send out all the wrong signals to the world but also hinder our ability to create a balanced economy. Many studies suggest that an increase in capital gains tax does not actually increase tax receipts; it is quite the reverse. For example, during the last century in the United States, virtually every time taxes were lowered, whether on employment, savings, investment or risk taking, tax revenues went up, not down. A small country such as Britain can flourish only if it is able to create a highly skilled, highly creative, innovative, open and value-added economy, and this can be achieved only by the Government creating the right economic environment that attracts both inward investment and the best brains. Creating a competitive tax structure is essential to enable this. As Winston Churchill famously said,

“for a nation to try and tax itself into prosperity is like a man standing in a bucket and trying to lift himself up by the handle”.

The introduction of the Office for Budget Responsibility is a positive move, as is the plan to increase the Bank of England’s regulatory power. In my opinion, the FSA was asleep on the job and definitely not up to the job. I am convinced that, if the Bank of England had been in charge, much of the suffering in our financial sector and the economy over the past three years would have been prevented.

The welfare reform Bill is also welcome. We have a benefits trap in this country. Today, the difference between welfare support and a 40-hour week on minimum wage is just £37—hardly enough to inspire people in difficult times to seek jobs. As I have said before, in 1997 government spending accounted for 40 per cent of GDP, similar to the level in the United States. Last year the figure rose to 52 per cent of GDP. That is just not sustainable. We have a public sector that is not delivering; it is overpaid and full of jobs for life and gold-plated pensions. Setting a target for reducing public sector spending to 40 per cent of GDP is essential and would, in effect, wipe out our deficit.

This is not just about making cuts; it is about making the right cuts. Ring-fencing services for votes has led to an incredible sense of imbalance. On the one hand, the Department for Work and Pensions has a £135 billion budget, yet we skimp on national security and our Armed Forces while our brave troops are making the ultimate sacrifice for us.

I am delighted that the Minister has talked about supporting SMEs. There is talk of a £500 million loan guarantee scheme, but that is a drop in the ocean when compared with the £1 trillion of quantitative easing for the financial sector. Again, this is about priorities. Britain’s higher education sector punches above its weight and is the best of the best in the world, in spite of 13 OECD countries outspending the UK as a proportion of GDP. It is important that cuts in the area are completely avoided. Education is our future and the key to our competitiveness.

I believe that this Government can snatch victory from the jaws of defeat if they recognise that it is the private sector that creates the jobs that pay the taxes that pay for the public sector and that thus pay the people who genuinely need our help. We must never forget, as the Minister said, that by stifling business we kill the goose that lays the golden egg.

This was a game-changing election and I am very hopeful about this new coalition. However, our economy could either be “Con-Dem-ed” or “Con-Liberated”. For the economy, although things look incredibly bleak at this moment, now is the time to seize the opportunity—to go down the route not of the politics of envy but of the politics of aspiration. Now is the time to unleash the spirit of enterprise and achievement for which this great country has been famous for centuries and centuries.

17:05

[The Lord Bishop of Wakefield]

My Lords, on behalf of these Benches, I, too, congratulate the noble Baroness, Lady Wilcox, on her new role.

As all the analysts remind us, food stands at the top of the hierarchy of human needs, so some self-sufficiency in food production should be a priority for us. There is much to welcome, both in the gracious Speech and in the programme for government, on the subject of agriculture and food supply. The decentralisation and localism Bill picks up the heralded emphases on subsidiarity, removal of overregulation and a movement towards big society. Encouragingly, this retains some bias towards poorer regions and a real attempt to avoid the worst effects of the cuts in West Yorkshire, where I am based, and in similar post-industrial areas, where there are areas of related urban and rural poverty. Agriculture, indeed, in our part of the world can often be a subsidiary career standing alongside teaching, industry or commercial business within the same family. Moreover, the Bill will go some way, I hope, towards redressing the recent decline of local services in rural communities.

Only once have I found myself performing the role of a flying picket. It was unfortunately ill timed very early one January morning outside a dairy in Leeds where, in temperatures of minus 10 degrees, we protested about the absurdly low prices being offered by supermarkets to dairy farms for their milk. I am therefore happy to see in the programme for government the proposal to bring forward a Bill to introduce an ombudsman to enforce the grocery supply code of practice and to curb abuses by the supermarkets. I have been told time and again by local farmers of an almost piratical abuse of power—for example, premiums are demanded of smaller suppliers if supermarket chains are to market their products. Although it was not in the gracious Speech, I hope that this Bill will be a clear and urgent priority for government.

The programme for government happily mentions the huge potential of energy production from the waste products of anaerobic digestion. Like politicians, clergymen are not immune from being accused of purveying the dung of bulls, but on this occasion I am prepared to glory in it. Last month, when I was visiting Kellingley colliery, I spoke to representatives from the enormous Drax power station, who talked of co-operation with farmers, locally and further afield, in the production of biomass fuel to be used alongside coal. I am glad that Her Majesty’s Government recognise that the urban, industrial and rural are far more directly interdependent than is sometimes appreciated. I hope that this kind of process will be continued.

There remain crucial challenges to the rural and agricultural sector, not least from animal disease. One need only recall foot and mouth, bluetongue and BSE as relatively recent examples. The issue now of bovine tuberculosis remains critical and affects the financial viability of far too many farms. I hope that Her Majesty’s Government may be able to work with the Farm Crisis Network and other voluntary bodies, using the big society model once again—but, at the same time, providing the finance and incentives where these are needed—to rise to these challenges and to help to reduce the incidence of this disease.

Perhaps most crucial of all is the provision of an infrastructure that can encourage a proper self-esteem in the rural agricultural sector in these coming years. Many things, including disease, as I have just noted, and overregulation, have contrived to reduce self-esteem in this sector. Self-esteem is crucial to any individual or community if they are to move forward and prosper. Here, the gracious Speech offers much encouragement: high-speed broadband, reform of the Post Office locally, decreased regulation and dispensing with unnecessary quangos. However, I would plead for subtlety and care in taking forward reform. Post offices provide a vital lifeline for rural communities. Our churches can help in this by offering outreach services within our own buildings—I hope that we can be used further here. I trust, too, that we can make access easier to other facilities offered by post offices. For example, direct debit facilities with suitable support services can enable even the poorest in society to take advantage of the discounts available when paying utility bills.

The Book of Common Prayer—in a way, the Church of England’s title deed—includes prayers and thanksgivings for fair weather, for rain and for plenty. Quaint as the articulation may now seem, this reminds us of the crucial part played by food production and its wider role in human flourishing. The welfare of the agricultural sector and all those who work within it, alongside the care of our rural areas and populations, impinges indirectly but importantly on every one of us.

17:10

[Lord Lawson of Blaby]

My Lords, it is a great pleasure to follow the right reverend Prelate, who speaks with such authority about some of the problems of rural England. I also congratulate most warmly my noble friend Lady Wilcox on her maiden speech as a Minister. I cannot pretend that I agreed with every single word that she uttered, but she uttered them with enormous charm. Above all, I wish the new Government every success in the massive task before them and the resolve to stick to that task despite the deep unpopularity that inescapably lies ahead.

I warmly welcome the statement in large type at the end of the coalition’s agreed Our Programme for Government, which states:

“The deficit reduction programme takes precedence over any of the other measures in this agreement”.

Quite right. There must be no sacred cows and no sacred departments.

Meanwhile, I welcome the start that has been made in cutting public expenditure and reducing the public deficit, with an in-year cut of a little under 1 per cent of total public spending. This is, of course, only a minuscule fraction of what has to be done, but essentially it is an earnest of the Government’s intentions. The first Budget of my right honourable friend Mr George Osborne later this month will need both to get to grips with the immediate crisis and to set out, in convincing terms, the financial prospect and programme for the next five years. I wish him well.

I detect unease in some quarters about the promised increase in capital gains tax rates. In so far as I understand it, I fully endorse what the Government have in mind, which is perhaps not surprising, since I introduced a similar reform in my 1988 Budget. I do not have time to set it out now, but I refer noble Lords to cols. 1004-06 of the Official Report for 15 March of that year. That reform—it is not without interest that the Reagan Administration in the United States introduced much the same reform at much the same time for much the same reasons—worked very well and lasted successfully for more than a decade.

The previous Government’s foolish decision to undo that position, abolishing both indexation and the tapering relief, which was a rough and ready substitute for it, and replacing it with a capital gains tax rate of 18 per cent, has had three main consequences: it created a bonanza for short-term speculators; it led to a massive increase in tax avoidance and thus a serious and continuing loss of income tax revenue—the point is the income tax revenue, not the revenue from capital gains tax; and it greatly stimulated the buy-to-let boom, thus hugely inflating the housing market, which has been a major cause of the worst boom and bust that we have suffered since the war.

I welcome the fact that my right honourable friend the Prime Minister chose to make the economy the subject of his first major speech as Prime Minister. However, I have some questions about what he called “rebalancing our economy”, which he explained meant less dependence on banking and finance and a boost to manufacturing. Banking and finance are not only a major growth industry in the age of globalisation but one of the few major industries in which this country is a world leader. To have the objective of shrinking it would both amaze and delight our overseas competitors. Of course there need to be changes to reduce greatly systemic risk and I welcome the new Government’s decision to have an independent commission to look into how best to separate traditional retail and commercial banking on the one hand from high-risk investment banking on the other. As the Governor of the Bank of England, among others, has cogently argued, that badly needs to be done.

I have to observe that, far from assisting manufacturing, the Government, like their predecessor, appear to be hell-bent on clobbering it further by substantially increasing its energy costs in the name of an intellectually incoherent climate change policy. There is no time to elaborate on this today, but I commend to noble Lords the excellent and grim speech made by the eminent engineer Sir Alan Rudge to the Royal Academy of Engineering some six weeks ago. I hope that the Government will read it and ponder it. I add only that to impose this burden on British manufacturing industry unilaterally—for none of our competitors has the slightest intention of following suit—is not only suicidal but completely pointless, since even those most concerned about carbon emissions agree that it is only global emissions that matter. At the very least, I ask the Government to undertake to hold a fundamental review of UK climate and energy policy in the light of the outcome of the United Nations climate change conference to be held in Cancun in December.

17:15

[Lord Bhattacharyya]

My Lords, I offer my congratulations to the new Government, and to the noble Baroness, Lady Wilcox, on her appointment. I am lucky enough to have known her for some time, and I am sure that she will provide intelligence, experience and vision to her department.

Time is limited and the topic is huge, so I shall limit myself to a subject I know about—technology and manufacturing. From the minimum wage to the science budget, Britain is a better place today than it was 13 years ago. For all the rhetoric from the coalition, there is much that the new Government will not undo. I am pleased that thoughtful Ministers such as David Willetts accept that Britain has changed for the better. In that spirit, I welcome the measures in the gracious Speech to support industry and the Prime Minister's speech last Friday, in which he called for a rebalanced economy. I have long been a voice in the wilderness on that topic, and it is pleasant to have such support. The question is how we achieve balanced growth while reducing the deficit as the Government propose. If we improve our manufacturing exports by 10 per cent and cut manufacturing imports by 10 per cent by import substitution, this would contribute £50 billion each year to our balance of payments, which will ensure real growth.

An example is the steel industry. The vice-chairman of Tata Steel, which includes Corus, has said that in 1970 the UK consumed 25 million tonnes of steel; 95 per cent of this was produced at home. Today we consume only about 8 million tonnes, just half of which comes from the UK. Why? Because we have limited demand due to our industrial decline. Britain is the only European country to have had such a dramatic fall. We therefore need an integrated manufacturing policy that brings together all sources of funding, from banks to RDAs to research councils, in order to secure growth. Merely discussing industrial activism does not deliver business growth. I declare an interest: I am the director of the Warwick Manufacturing Group at the University of Warwick. Our funding is largely from the private sector from throughout the world and we contribute to the finances of the university, so I hope that the Business Secretary will not be too harsh on me.

As the coalition begins work, there seems to be some discussion of the role of “impact” in university research. It is true that in areas of blue-sky research and the humanities, impact can become a box-ticking exercise. In applied science and in technology, however, impact is precisely the right measure to judge research. Applied science is successful only if it is useful. For technologists, impact is not a way to secure value for money but a path to economic growth and productivity. The Engineering and Physical Sciences Research Council is already looking at impact, and it should be encouraged to do more.

I am no interventionist—there should be no return to a bailout culture—but we must not turn away good, profitable businesses looking to invest for the future. We have excellent manufacturers in Britain. Two years ago Jaguar Land Rover made a huge loss, but today it exports £6 billion-worth a year. The turnaround has been remarkable, but when the company was in trouble there was no one there to help. There are other excellent industries too: JCB, Rolls-Royce aero engines, British Aerospace and so on. We must not lose them.

As David Green, director of the think tank Civitas, has said, cutting industrial investment now, whichever way you want to cut it, would be like eating seed corn to get through the winter. I welcome the proposal for a green investment bank but a green economy will require contributions from every sector, from automotive to energy to healthcare.

I am a regular visitor to China and India, and industries in those countries are climbing the value chain at an alarming rate. We must help our industries compete and partner with these expanding sectors. Given the near double-digit growth of both China and India, we must move fast. Considering Britain’s historical decline in manufacturing, some, including our partners abroad, think that this cannot be done. Yet in my home region, Advantage West Midlands is helping firms build the skills and technology that will bring investment from the manufacturing giants of the new economies, while supporting productivity and innovation at home.

There appears to be a question mark over RDAs. Yes, they should look carefully for savings, but RDAs can make a vital contribution to future growth. The Government should retain RDAs that work well, because there is no substitute for them.

I come from Birmingham, where we have a long history of Liberal and Conservative coalitions, mergers and unions. I say to the Benches opposite that they will be best served by the radicalism of a Joseph Chamberlain, not the caution of a Neville. We need growth. We should focus on creating the jobs, technology and products that will increase revenues, reduce costs and attract investment. I look forward to the Government’s proposals on that.

17:23

[Lord Teverson]

My Lords, I also congratulate the noble Baroness, Lady Wilcox, on her appointment to the Government. When we were both sitting on the opposite side of the House, with the same portfolio, we agreed on many things, as indeed did much of the House. I look forward to that co-operation continuing, if with slightly different departmental interests. I am also delighted to be the third speaker from Cornwall on this debate.

One of the things that came through strongly in the initial coalition agreement when negotiations took place between the Conservatives and the Liberal Democrats was the detailed manifesto and list of points on energy and climate change issues, which are what I shall concentrate on today. That was extremely important as a joint agenda for this coalition Government. It was certainly reflected again in the formal coalition agreement that was published by the Government a week later and in the gracious Speech we heard last week.

I particularly welcome the energy security and green economy Bill. That includes at least three of the things that several of us from both sides of the House tried to achieve during the last couple of years of the last Government. First, there is a big move forward in energy savings. Again, I remind the House that just under half of carbon dioxide emissions are due to heating, and that we have in the Bill a large move forward to make sure that energy efficiency is much improved in domestic and business premises. That, with the green deal generally and the green investment bank, is a way of moving that agenda forward at last. It is good for improving fuel poverty, carbon emissions and energy security. I very much welcome it, although I look forward to seeing the details of what will be a large sum needed to convert our historic building stock into a much more energy-efficient estate. That will be quite a challenge in times of financial straitjackets and difficulty.

I also particularly like something that we debated during the last Energy Bill—that is, the emissions performance standards of power stations. At last we have bitten the bullet and we are there; we are going to bring that forward. It is an excellent advance and one that I look forward to debating and supporting in this House when the Bill comes through. Also in that area, we have the green bank and not just smart meters, which are already in the pipeline, but a smart grid. That is absolutely vital when we still rely so much in the renewable area on intermittent technologies. I hope that, under the Government’s programme, anaerobic digestion will come through. That is less intermittent and can help very much with heating.

Also important, though stressed less in the gracious Speech, was the mention of climate change and the conference in Mexico later this year. There are huge challenges in that area. We cannot forget that Copenhagen was—particularly for Europe, but also for the world in general—a failure. It was a deep failure to perform and find a way forward in this important area. The Government are right to emphasise that. I wait with interest to hear how we will tackle that, both as a nation and as Europe, to make sure that there is a positive result. Again, I welcome generally the indication that we will move forward as Europe to a 30 per cent offer if we can keep it on the table. That should be something that we strive for.

There are many other good things in the coalition programme, such as charging points for electric vehicles, no third runway for Heathrow and the high-speed rail network, which I am sure my noble friend Lord Bradshaw will talk about as well. What I hope most of all is that a tradition I came very much to welcome in the House during the term of the last Government—that of general consensus-building on climate change around the whole of the House—will continue over this parliamentary Session.

How do I sum up? The best words are those of the new Green MP, Caroline Lucas, who stated that the Queen’s Speech was, on the environment, “pretty half-hearted”. For the Green Party, that is praise indeed.

17:28

[Lord Oxburgh]

My Lords, I, too, welcome the noble Baroness and the noble Lord in their new roles on the government Front Bench.

Today, I will continue the energy theme and talk about electricity supply. Unfortunately, the financial crisis is not the only one facing this country. I believe that every informed observer recognises that we have a looming electricity shortage. Older generation plant is being withdrawn from service without a plan for timely replacement of capacity. The problem has been apparent for years. With every passing month the opportunity to make an orderly transition to a modern electricity supply system slips away. We are facing a crisis that is entirely of our own making. The situation has not been helped by 17 changes of energy Minister in the past 10 years. Energy policy requires both understanding and continuity. I declare an interest as a director of Falck Renewables and Blue-NG and as honorary president of the Carbon Capture and Storage Association.

The role of government is to steer a smooth transition from a fossil fuel economy to one that is economically and environmentally more sustainable. Electricity generation is the most complex part of energy policy. It is complex because different methods of generation have quite different characteristics and because electricity demand can vary by a factor of three. Furthermore, it is not clear whether in the long term electricity demand will increase or decrease. It will decrease because of energy-saving measures and greater efficiency but may increase through population increase and, indeed, through increasing electrification of the economy.

Overall, our priorities have to be pretty clear. We need security of fuel supply and electricity supply; environmental security in the form of minimal emissions of particulates and greenhouse gases; and all that at the lowest cost. The Government have to balance these priorities against each other, take a system-wide view of electricity generation and then provide a regulatory and financial framework which aligns the interests of energy companies with the long-term interests of the country. The framework needs to recognise that many of these companies are international and has to be sufficiently clear that it provides business with the confidence to make the 30 to 50-year capital commitment in the UK. Today confidence is lacking. Building this must be one of the highest government priorities.

Security of electricity supply requires a diversity of generation methods and energy sources. Within a decade there will be an increasing role for photovoltaics, tidal generation, biomass, biogas and other technologies. However, today the main ways that we have of generating electricity are wind, nuclear, coal and natural gas, and the near-term strategy will be based on these. But because their characteristics are so different they cannot sensibly be combined in any proportions that happen to be the outcome of short-term market forces or, indeed, the likes or dislikes of particular pressure groups.

In the absence of government steer, and with uncertainty about the future penalties for emitting CO₂, the market would, if left to its own devices, produce a system built entirely on gas. Gas plants are flexible, the least expensive, quick to build, and the gas price risk is carried by the consumer. However, this would not be in the country’s best interests.

Time precludes discussion of the complications of different generation mixes, but as an example, the proportion of wind in the mix has implications for the proportion of nuclear. Both are relatively inflexible and because most of the cost of both is paid at the time of construction there is no saving in not using either to the full when they are available. The proportion of wind also has a major bearing on other aspects of the system; for example, whether to build interconnectors with a view to exporting electricity when generation exceeds demand and importing it when we have a shortfall. Danish experience in this respect is not encouraging but there are obviously other ways of managing wind intermittency. I make these points only to emphasise that there is no single correct answer to the balancing conundrum; but there are numerous wrong ones. Action is urgent because lead times are long.

We have to consider the system as a whole and the interactions, both near-term and long-term, between its parts. That includes the electricity transmission grid, much of which will have to be replaced over the coming decade.

In conclusion, I re-emphasise that we have to consider the system as a whole. There are political decisions, technical decisions and business decisions to be made. I hope that the Government will consult rapidly and widely, and then act decisively. I wish them well.

17:35

[Baroness Byford]

My Lords, I am greatly privileged and highly delighted to rise to my feet on this side of the Chamber in the debate on the 14th gracious Speech since I entered this House. I am glad that the grouping has placed agriculture alongside business and economic affairs, headed now by my noble friend Lady Wilcox, who richly deserves this post and brings her great experience of the fishing industry to her portfolio. I extend my best wishes to her.

Air, food, water and warmth are the four essentials of human existence and are all endangered by human activity. The Register of Lords’ Interests records my connections with farming and I make no apology for speaking on that subject to an audience that is primarily concerned with other aspects of our economy. Farming is a business, and although it employs only 2 per cent of the workforce on farms, some 14 per cent are employed in the food sector. The right reverend Prelate the Bishop of Wakefield clearly laid down some of his concerns and reflected on the dependency of people who live in towns and in rural areas.

Land capable of producing food is shrinking worldwide. Our climate is changing and the world population is increasing. In the UK, we have ideal climatic conditions for producing food, and yet, since the previous Government came to power, there has been a dramatic fall in UK food production from 86 per cent self-sufficiency in indigenous foods, and 75 per cent in all foods, to 72.5 per cent and 59 per cent respectively by 2008. Our food trade balance deficit has increased from £6 billion to £17.4 billion.

Farming in England is highly productive and broadly based, but in some areas is unprofitable. The drive for cheap food has kept prices low, with manufacturers, processors and retailers competing for market share. Legislation and regulation also involve the prime producer in additional costs. There are many examples of the costs of legislation, but I shall give just one example.

The need to comply with regulations on nitrate vulnerable zones has involved the construction of very large, effectively double-skinned, slurry pits, the erection of fencing to stop livestock from accessing watercourses, the introduction of systems to prevent fertilisers reaching watercourses and training for staff on the new rules. I am not against sensible legislation, but we have a superabundance of it, much of which lacks proportion. I also wonder what happens in other countries.

This Government are committed to controlling the growth of the deficit and, thereafter, to reducing it. Included in this first step is a saving from Defra of £162 million. In March, Defra was fined a total of £15.6 million for failures in 2007-08 in the provision of payments by the Rural Payments Agency and in the running of the rural development scheme. I have no reason to believe that the RPA will not incur further penalties for 2010. The Minister acutely needs to look at this area. The overhaul of that agency is urgent and imperative. In a Written Answer on 17 March, the Defra Minister stated that,

“the National Audit Office calculated the average cost for administering a single payment scheme claim as £1,743”.—[Official Report, Commons, 17/3/10; col. 899W.]

That figure applied to English farmers. The Scottish equivalent was £300, and its farmers are paid on time and correctly.

Today’s debate incorporates the environment and energy, both of which are important to farmers. Climate change is already having a profound impact in some areas and there are tough decisions to be taken about whether agricultural land should be given over to flood relief or even abandoned to the sea. The Campaign for the Farmed Environment is progressing well, and I welcome the move on the natural environment paper. Farmers have been recompensed for looking after parts of the environment, and for a long time they have looked after it well; but biomass and anaerobic digestion will become important energy resources in future.

On rereading the gracious Speech, I was particularly pleased to reflect on the Government’s commitment immediately to address the deficit reduction; to a swift curtailment of bureaucracy; and to the rapid extension of high-speed broadband, which will so help rural areas. I welcome my noble friend Lord Henley, who will respond in this debate, to his post. He is well qualified for it and I know that he has a demanding task ahead. I congratulate him on his appointment and look forward to working with him.

17:40

[Lord Lyell of Markyate]

My Lords, I am glad to follow my noble friend Lady Byford, and warmly to congratulate my noble friends Lady Wilcox—both on her speech and on her appointment to the Government—and Lord Henley. I am extremely grateful that, for medical reasons, I am speaking much earlier in the debate than my economic knowledge justifies. I apologise for the fact that, for sensible reasons, I shall not be present for the wind-ups. I will speak on the prospects for improved financial regulation; briefly on the environment and renewable energy; and briefly on the challenges of reform of this House and the House of Commons.

I congratulate the new Government on the thoughtful wording of the gracious Speech on the credit crunch. It stated:

“Legislation will reform financial services regulation to learn from the financial crisis”.

There is much to learn, and I listened with great interest to the speech of the noble Lord, Lord Myners. I speak not as an economist but as someone with a background as a commercial lawyer. I express my debt to Gillian Tett of the Financial Times for her excellent account of the origins and development of the crisis in her book, Fool’s Gold.

Financial services regulation certainly needs reform, but I hope that this will concentrate on the big picture—on the fundamentals of banking and accountancy—and not become a box-ticking exercise. One of those fundamentals is that banks should hold adequate reserves in relation to their assets and their true risk exposure. Under the Basel Accord of 1988, the required figure was about 8 per cent. In Basel 2 in 2004, it was thought that this could be reduced if it was replaced by entities such as credit default swaps and collateralised debt obligations, and much more freedom was given to banks to judge how risky assets might be. The seeds of the problem already existed, and this did not work. As we know, the innovative notion that credit risk could be adequately managed if it were sufficiently widely sliced and spread around the market proved to have built a house of cards. Governments here, in Europe and in the United States must reach a new accord and decide what reserves should reasonably be required and what role if any is to be permitted for these innovations. There may be a role for credit default swaps, collateralised debt obligations and so on; but a jaundiced eye must be cast on the lack of transparency which pervaded this market for too many years.

The second fundamental improvement relates to accounting practice. It is not acceptable that debt for which a bank is ultimately responsible, or on which it relies in time of crisis, should be hidden off the balance sheet in SIVs—structured investment vehicles. Care must be taken to ensure that statutory accounts once again give a true and fair picture of the bank’s assets, indebtedness and vulnerability to risk as a whole. If SIVs are to be used at all, their existence and extent must be clearly shown on the bank’s balance sheet.

I do not wish to be simplistic and those are just two points—there are many others. The expressed desire of the Government, articulated in the gracious Speech, to learn from this massive financial crisis is a very wise starting point.

I shall say a quick word on the environment and renewable sources of energy. A new Government is a time to take stock. I am not opposed to wind farms but I listened with care to what the noble Lord, Lord Oxburgh, said. Are they likely to prove economic and to justify the level of investment and subsidy involved? I hope we will also give new impetus to nuclear power, and I was glad to hear that mentioned by the Minister. We already buy a substantial proportion of our electricity from French nuclear installations. The problems of waste exist but are far from insurmountable. Nuclear power will, in the words of the gracious Speech,

“promote low carbon energy production and … secure energy supplies”.

I shall say a brief sentence on the plans for the reform of Parliament. Whatever system emerges, the essential requirement is that it should attract to both Houses people of the right calibre who are ready, willing and able to do the work. They must be able to live reasonable lives with clear, straightforward rules on pay, taxes and expenses as similar as possible to those that apply to all other citizens.

This, I believe, is a time not only of great challenge but of genuine hope, and I feel privileged perhaps to be able to play a further part.

17:47

[Lord Haskel]

My Lords, I, too, congratulate noble Lords opposite. I wish them every success. I also welcome the fact that a new generation has taken over. This is particularly apparent to me because the people with the real power in this Government are the same age as my children. Of course, it is absolutely right that a new generation should take over but there is one thing that worries me. My children and their friends hardly seem to be able to organise themselves, never mind organise the country, so the more mature members of the Government—such as the noble Baroness, Lady Wilcox, who opened this debate with such skill—will have to practise both ministerial and other skills. Indeed, her magic is already working. Instead of fighting each other, the boys and their gangs are playing together. This calms everybody down—especially those who do not really want to play because they do not like the rules—so well done there.

Today’s debate is about business and economics, and I start with the politics of this. When we last had a Conservative Government—when I first came into your Lordships’ House—we were told that we had to choose between a strong economy and a fair society. The two were mutually exclusive. It was John Smith and new Labour that turned that argument on its head, and for 13 years we had a Government who believed in a strong economy and a fair society going hand in hand. Indeed, that is what brought me into politics, and that is why under Tony Blair and Gordon Brown this country has become more prosperous, better educated and a healthier, nicer, more tolerant and greener place to live. I say to my noble friend Lord Myners: yes, I am proud of that. However, what I want to know is: will this Government continue with this policy? Even in an age of austerity, it must be right.

Turning to banking, it is wrong to delay action in favour of a technical review. During the election campaign one thing that came over strongly was how angry people are at having to bail out the banks and the effect that that has had on the real economy. The election may have toned it down, but the anger is still there and it will come back with compound interest. Inevitably, that will lead to a sense of betrayal. Wholesale reform is required now, not reviews and tinkering with regulation.

The coalition agreement has quite a lot to say about regulation and red tape. All new Governments start with a promise to cut red tape and regulation, but this Government promise to cut it and introduce new regulation at the same time. On the page of the coalition agreement which promises cuts, we are told that the banking regulatory system will be entirely reformed and bonuses will be regulated. My noble friend Lord Myners spoke about that. We are told that regulators will have new powers to define and ban excessive interest rates on credit cards and other examples are scattered through the document, such as the right to request flexible working and equal pay. I hesitate to ask how all this will operate with the one-in one-out rule, especially when the public use their promised right to challenge regulations. In reality, you have to deal with market failure; that is what you want the citizen to tell you about. Of course, poor and outdated regulation needs to be cut, but the real threat to innovation and enterprise is the absence of competition through unregulated market failure. By concentrating on the populist and ignoring the important, the Government have got this the wrong way round.

Innovation and enterprise brings me to the business section of the coalition agreement, where there are indications of some of the ways in which the Government will help business, but on the overall context within which business operates the paper is silent. Will we continue to be a champion for open markets and, if so, how will we achieve this when we all agree that economic power is moving east? Although these new strong economies have joined the G20 to play by the existing rules, we know that their participation is about writing new rules. Unless those rules create a level playing field, our commitment to being an open market champion could make us very vulnerable. I think we should know what the Government's views are on world trade.

Perhaps the Government do not really care. In spite of their fine words, maybe the Government have no confidence in British business and industry. After all, on page 7 of the coalition agreement, they refer to it as “rubble”. We have many fine businesses in this country—my noble friend Lord Bhattacharyya listed some of them—and to refer to them as “rubble” is a disgrace. That is yet another example of this Government's apparent fondness for running down Britain. I am sure that many noble Lords opposite feel rather embarrassed about that. We all go into politics to make a difference and I hope that this coalition will make a difference, not just to the country, but for the country.

17:53

[Baroness Garden of Frognal]

My Lords, I too welcome the Minister to her new post and look forward to working with new-found professional friends in this legislative programme. The first priority in the Queen’s Speech is,

“to reduce the deficit and restore economic growth”.

In this wide-ranging debate, I shall focus on using the talents and skills of the whole workforce to best effect.

Under the previous Administration, apprenticeships increased from around 65,000 to 250,000, with a completion rate of more than 70 per cent. That has to be a very worthy achievement. We warmly welcome the announcement last week of investment in a further 50,000 apprenticeships, with £150 million diverted from Train to Gain. That will be particularly relevant for adult apprentices, where the demand has been the greatest. Many of those might be within the public sector and it will be a challenge to ensure that placements can be taken up in the face of cutbacks in public sector employees. It is essential to engage the next generation in meaningful training for work, to re-skill adults, to encourage aspiration and to reward achievement.

Craft, manufacturing and service industries all have the potential to increase their productivity even in times of hardship. As the Minister indicated, crucial to that growth will be small businesses which will benefit from the intention that:

“The cost of bureaucracy … will be reduced”—

a very welcome intention.

The stringent cuts ahead should not be allowed to reduce opportunities for creativity and enterprise. What more can be done? One question we could ask is: why is it that women, who demonstrate great initiative and enterprise in other countries, are only in the UK half as likely as men to start up their own businesses? To that end, we have long argued for improvements in careers information, advice and guidance. It is not too soon to set out to children at secondary—even primary—school the range and variety of practical jobs which call for vocational skills and to interest them in business. Career ambition and aspiration is not just for academic and professional walks of life. Students should be aware of the opportunities which speak to their individual talents and motivation, whether for economics or catering, astrophysics or car repair, philosophy or care—and none of these is, of course, mutually exclusive.

Recent research from the City & Guilds Centre for Skills Development drew two important lessons: first, that vocational education works best when delivered in partnership with the community, including local employers and parents; and secondly, that the programmes are most successful when both vocational and academic learning are well integrated. We shall have a golden opportunity next year to raise the profile of vocational achievement when London plays host to the WorldSkills Competition. It can be inspirational to witness the levels of skills from young people at such competitions, and a challenge to our workforce to rival the best in the world.

Practical skills have key parts to play in economic regeneration, but so, too, must we concentrate on the country’s poor record of financial literacy. We battled in the last Session to have personal, social, health and economic education made statutory in schools and just lost that valuable measure in the final hours of the previous Government.

Personal debt in this country has long exceeded £1 trillion, too much of it unsecured and unmanaged. We are paying the price of lack of corporate financial literacy in the banking crisis. Ensuring that young people start in life with the basic tools of financial management will pay short- and long-term dividends for individuals and for the nation.

The positioning of further and higher education within the Department for Business, Innovation and Skills is indicative of the economic impact of these sectors. However, this does not in any way detract from the invaluable academic, social and cultural aspects of our lives. Will the Minister, in response, give assurances that universities and further education colleges will be supported in maintaining the highest standards of teaching and learning; that their administrative burdens will be eased; and that funding will reflect the long-term contribution they make to individual well-being and the national economy? We look forward to lively and productive debates as we find new ways of working collaboratively in the coalition Government.

17:57

[Lord Monson]

My Lords, the gracious Speech emphasised the Government’s commitment to freedom, fairness and responsibility—an admirable set of objectives on which I congratulate the coalition. How do specific legislative proposals in the gracious Speech measure up to these criteria?

One of today’s themes is agriculture. The space allotted to agriculture in the Conservative manifesto was rather thin and insubstantial, as Alice Thomson pointed out in the Times shortly before the election. Many more words were devoted to conservation, biodiversity and so on than to the growing of food, the plight of the hill farmer and the like. However, right at the end a brief reference was made to the Hunting Act, saying, in essence, that it ought to be repealed because it has “proved unworkable”. Well, that is largely true, but it is scarcely the main reason for having it repealed. The main reason is that the Act flies in the face of the principles of freedom and fairness.

I have no interest to declare, as neither I nor any of my family hunts, but I know many people who do from a surprisingly wide occupational spectrum. They are understandably aggrieved that this part of our rural heritage has been outlawed because of a majority who were mainly guided by emotion rather than by a cool, objective examination of the evidence. Rest assured that I will certainly not try to go through all the arguments again, but the fact remains that the great majority of veterinary surgeons and other animal experts and no fewer than four former directors of the League Against Cruel Sports have come to the conclusion that hunting is the least cruel way of controlling the fox population and that, on balance, foxes have suffered more since the ban than before, to say nothing of the extra suffering to livestock arising from a larger fox population.

One accepts that freedom needs to be tempered with responsibility. The noble Baroness, Lady Golding, who sits on the Labour Benches, together with Mr Lembit Öpik, who until recently graced the Liberal Democrat Benches in the other place, as well as others, put an enormous amount of hard and constructive work into helping to form the Middle Way Group, which rightly seeks to discipline that small minority of hunts that condone abuses or show lack of consideration to third parties. That was not only wrong but disastrous for the image of hunting. The middle way is the British way and surely the route that we should follow.

Unfortunately, the Prime Minister, Mr Cameron, and everyone in this country who would like to see an end to the hunting ban are all too likely to be stymied by what is the complete reverse of fairness. Realistically, I see no problem from Northern Ireland. However, honourable Members representing Scottish constituencies are a different matter. The Scots, like the Northern Irish, have unfettered power to make their own laws for hunting on their own territory, but the English and Welsh are denied that right. Is that really fair? Surely it is not, as most of the electorate in Scotland and Northern Ireland would almost certainly agree. In the absence of long-overdue self-government for the English on purely domestic matters—that need not cost money, as there would be no need for hugely expensive Assembly buildings—one fears that repeal of the Hunting Act is unlikely in this Parliament unless all MPs representing Scottish and Northern Ireland constituencies were involuntarily to abstain in any Division on a hunting Bill, which I suspect is asking for the moon.

There are so many other Bad Laws, to use the name of an excellent book by Philip Johnston, that need repealing that it would take most of the night to list them, but let us hope that the coalition’s slogan—freedom, fairness and responsibility—is indeed a binding promise, not simply a vague aspiration to be discarded when convenient.

18:03

[The Lord Bishop of Ripon and Leeds]

My Lords, I first acknowledge the need so well expressed in the coalition document and the gracious Speech to reduce our national deficit and, alongside that, the moral dilemma faced by the Government in just how to do that. I want to explore that.

The most basic principle needs to be that those with the broadest shoulders should bear the heaviest burden. There is much more in the gracious Speech and its notes about cuts than there is about taxation, although there is a reference to fairer taxation, and I look forward to discovering just what that means. I hope that the Government will acknowledge that fiscal adjustments are also there to be used as a part of the economic proposals. Our taxes are not simply a way of purchasing public services; they are also the charge that we pay for the opportunities and security that go with a nation where social bonds are strong. Mutual responsibility must be recognised as the key to our social fabric. Those who have done best out of the boom years should be at the forefront of the desire for generosity in a more astringent economy.

Some of us are old enough to have been brought up on that oft repeated cartoon from an earlier period of austerity in which a row of men—I fear that they are all men—are on a ladder rising from a flood, with the rich man at the top, the middle-class man below him, then the worker and then the unemployed at the bottom, his head barely clear of the water. The rich man is saying, “Equality of sacrifice. That’s the spirit. Let’s all take one step down”. It is that sort of inequality dressed up as equality that we need to avoid in our society.

Does the Minister accept the thesis of Richard Wilkinson and Kate Pickett in The Spirit Level, which has been cited several times in this House, that it is disparity of wealth that is most deeply damaging to society? Material inequality is harmful not only to those who are poor but also to those who find themselves having to protect themselves from resentment and discord. The last thing that we want is a gated society.

The notes in the reports that accompany the gracious Speech speak of the importance of mutuals and co-operatives in delivering public sector service. I welcome that emphasis, but I look to hear more about how that principle of mutuality is to be exercised in the economic sphere. What encouragement will there be of mutuals, from building societies to credit unions, to take a much more prominent place in the financial sector? Will the Government consider mutualisation as a way forward for the Royal Mail, with its unique loyalty to the Crown, and therefore to the whole of our society? Will its commitment to serving the whole of the population be preserved and nurtured? That will be one test for the concept of a big society, ensuring that that is more than a fig leaf for getting volunteers to deliver the state’s welfare obligations.

Welfare is in danger of following asylum as a term of abuse rather than of mutual generosity. The Government need to affirm and to celebrate welfare. One of the most distinguished previous occupants of these Benches, William Temple, coined the phrase “welfare state” in order to distinguish it from the “power state”, where those with wealth and power exercised coercive control over the citizens. The need for welfare at the heart of the state is as dramatic now as it was 60 or 70 years ago.

Finally, I highlight the needs of the third sector—not much referred to so far in this debate—because the third sector provides so much to enhance our mutual responsibility. Work in Leeds to enhance the learning of English, to encourage integration and to support children is holding its breath. Money destined for that work now appears to be threatened as departments assess their priorities. It is important for the Minister to reaffirm today the Government’s support for local initiatives—both by local authorities and by the third sector—which do so much to create that mutual dependence on which we rely for a flourishing culture, whether in times of affluence or in times of austerity.

18:09

[Lord Jenkin of Roding]

My Lords, I hope that the right reverend Prelate will forgive me if I do not follow on from his speech. I would like to say a few words about the subject touched on earlier by my noble friend Lord Teverson and the noble Lord, Lord Oxburgh, and talk about energy.

Let me say at once that I very much welcome what my noble friend on the Front Bench said about the future of new nuclear build. She will be aware that some anxiety was voiced when the Secretary of State at DECC was appointed, having regard to his well publicised, long-standing opposition to the nuclear industry. However, having read the coalition programme and read his speech in another place last week, I am now wholly reassured that the policy will continue as it has in the past and that we will get the new nuclear programme that is essential to the security to which the noble Lord, Lord Oxburgh, referred. I say to the Benches opposite that the only sadness is that it has all come 10 years too late because they thought they were winding up the nuclear industry and only discovered a few years ago that that would not be possible.

I also welcome the coalition’s policy statement about the need for a floor under the carbon price. This is widely regarded as essential by the nuclear industry. It is a crucial provision because it makes it clear that there must be a major incentive for low-carbon generation and a difference between that and higher-carbon generators. I understand that it is a matter for the Treasury—I am mildly surprised, but I am told that that is the case—and that DECC Ministers are hopeful that something may be said about it in the emergency Budget. All I would say to my noble friends on the Front Bench is that it would be a welcome assurance that would help to counter the uncertainty that is the real enemy of investment in this field.

Another anxiety that has been expressed by the industry is about changes that my noble friends have announced for the planning system, in particular, the abolition of the Infrastructure Planning Commission. I find it very reassuring that the Government have made it clear that the IPC will be abolished as a decision-making quango, but that its staff and the people who have been recruited to the commission will make sure that the application and planning processes for major infrastructure projects will continue and will be part of the Planning Inspectorate, with the hugely important change that final decisions will be made not by an independent quango but by Ministers accountable to Parliament. I was in touch with the chairman of the IPC, Sir Michael Pitt, before the election, and I discussed these proposals in detail with him. I was greatly reassured when he said that he regarded them as entirely workable. I hope that Ministers in the Department for Communities and Local Government, who are in charge of the planning system, will do their best to see that planning timetables will be no longer, and possibly shorter, than those envisaged in the Planning Act 2008.

In the last couple of minutes, I shall mention climate change. There is time to do only one thing: to draw the attention of the Government to a very important new report, called The Hartwell Paper—because it was put together at a conference at Hartwell House—describing a new direction for climate policy after the crash of 2009. We have had the failure of Governments to reduce carbon emissions under the Kyoto process. We have had the failure, which has been referred to more than once in this debate, of the Copenhagen process. We are also faced with the rising tide of public scepticism about climate change. They all inevitably lead to the likely failure of the successors to Copenhagen. There is not time even to outline the case made in The Hartwell Paper. I hope that it will be given attention because the theory behind it is that if you make cutting carbon and climate change the central objective, requiring unpopular decisions to be taken by a range of people, you are bound to fail. I shall quote one of the authors of the paper:

“It is not possible to have a ‘climate policy’ that has emissions reduction as the all-encompassing and driving goal. We advocate inverting and fragmenting the conventional approach: accepting that taming climate change will only be achieved successfully as a benefit contingent upon other goals that are politically attractive and relentlessly pragmatic”.

Those are the conclusions of a long, carefully argued paper, but I have come to the conclusion that if we are to fight climate change and reduce emissions, we cannot, to coin a phrase, go on as we are.

18:15

[Lord O'Neill of Clackmannan]

My Lords, I follow the noble Lord who, in other circumstances, I would call a friend, but that word seems to be used rather loosely in this place at present, so I shall not go down that route. Suffice it to say that we have debated and in large measure agree on a number of matters, but I shall not go down entirely the same route as him this evening, although I offer my congratulations to the Minister in her absence. However, her speech from the Dispatch Box this evening was uncharacteristically platitudinous when compared with the elegance and rigorous authority that my noble friend Lord Myners brought to the subject in the round. I hope it was not a valedictory address. I also hope that he does not view sitting on the Back Benches in opposition with too much enthusiasm because, as someone who would be quite happy, in the right circumstances, if not to show him, at least to tell him of the scars I bear from 18 years in opposition, I know that it is a pleasure that is grossly exaggerated. One gets the feeling that at least some on the Benches opposite return to power in much the same way as the Bourbons, having learnt nothing and forgotten nothing. The prescriptions that we are hearing are very much the prescriptions of the 1970s, 1980s and 1990s, but the problems are of a totally different character.

Tonight, I shall focus on a couple of areas relating to energy. I should start by declaring an interest: I have a position in two fuel poverty charities—one in Scotland and one in England and Wales—and I am also chairman of the Nuclear Industry Association. I want to draw attention to the plight of people who spend more than 10 per cent of their disposable income on keeping their homes warm and their water hot. Their number has increased considerably in the past six or seven years. It has done so in spite of a strategy, supported in large measure by the Liberal Democrats, who might even be prepared to accept some blame for it as well as credit because the Government responded to legislation that they promoted. There are three main reasons for fuel poverty: the straitened circumstances of the household; the price of gas and electricity; and the poor condition of the house, which is usually attributable to a combination of the age of the property, its construction and its inadequate insulation.

While social security for the poorest and winter fuel payments for pensioners and the elderly have, in many instances, exceeded inflation and have therefore been something of a help, the speed at which we deal with the inadequacy of our housing stock will be the most fundamental challenge to fuel poverty. What are the Government’s intentions here? There is no great reference to this in the election manifestos of both members of the anti-Labour alliance. There is now a kind of nod in the direction of affordability, but I am concerned about the future of the Warm Front programme, which is important because it is a means of improving the housing stock and keeping in employment people whose skill base is not all that great, but who can be important to the viability of households and, indeed, in the case of the elderly, to their lives. The surge in deaths among the elderly in the winter months is attributable in large measure to inadequately heated homes. A lot of good work has been done there, and we want that momentum to be sustained.

I will touch briefly on nuclear power. Despite the convolutions in the original statement about what Liberals can and cannot do to support nuclear power, I am reasonably hopeful that a fair amount of the programme will be carried out consensually. I have misgivings about planning—the previous speech highlighted one or two concerns that some of us might have—but we will have to wait and see. Part of the trick to recreating the nuclear industry in the United Kingdom will be our ability to support the supply chain.

When the Minister sums up, will he indicate what will happen to the promised £75 million loan which the previous Government agreed with Sheffield Forgemasters so that it could expand its capability, and say whether that assistance to the British industrial supply chain—this is not a subsidy; it is a loan, and interest will be charged on it—will remain? It is very important, if we are to have a rebalanced economy and a surge in manufacturing in the years ahead, that we have the fundamentals to create the new industrial base which this country requires to build its reactors, to put in its power stations and to serve international demand.

This is not just import substitution; it is the meeting of a major international shortage and it is fundamental to the next phase in one aspect of our manufacturing industry. If we do not get answers from the Government on this, our worst fears will be realised. At the moment, we do not have much faith in this Government’s capacity to understand the problems of manufacturing and to take it forward. If they can assure us this evening, some of our anxieties will be allayed, at least in small part, and potential investors in the nuclear renaissance in Britain will be extremely encouraged and very hopeful. The Nuclear Industry Association, which I chair, will certainly be very happy, as will all its members.

18:22

[Lord Oakeshott of Seagrove Bay]

My Lords, that was a sparkling and penetrating speech. I am sure that if the noble Lord, Lord Myners, leaves a gap on the Front Bench, the noble Lord, Lord O’Neill, will be well able to fill it if he so wishes. I, too, congratulate the noble Baroness, Lady Wilcox, on her appointment. Having had the privilege of working closely over the past few years with my right honourable friends David Laws and Danny Alexander, I think that David is a tragic loss and I very much hope that we will see him back soon at the highest levels of government. Anyone who knows Danny knows that he will do an exceptionally good job in David’s place.

I declare an interest as a pension fund investment manager since 1976. I now specialise in commercial property, and Vince Cable has just appointed me as chairman of his business advisory group of experts to give him private, informal, and indeed unpaid, advice on business and economic policy.

I will talk today about tax and tax avoidance as the Liberal Democrat Treasury spokesman. Tax was at the very heart of the general election campaign. Our pledge to take anyone earning under £10,000 a year out of income tax struck a real chord with people of all political persuasions and none: combining, as it did, fairness with incentives to work for our fellow citizens trapped by cripplingly high rates of tax if they come off benefits into paid work. That is why that same pledge is now at the heart of our coalition’s Programme for Government. We also welcome the support of the noble Lord, Lord Myners, for the coalition policy on CGT. May I say to him that the coalition’s door is always open?

It is worth reminding ourselves what the Programme for Government says about tax:

“We will increase the personal allowance for income tax to help lower and middle income earners. We will announce in the first Budget a substantial increase in the personal allowance from April 2011”.

That will be funded partly by,

“revenues from increases in Capital Gains Tax for non-business assets as described below”.

We will prioritise increasing the personal allowance,

“over other tax cuts, including cuts to Inheritance Tax … We will seek ways of taxing non-business capital gains at rates similar or close to those applied to income, with generous exemptions for entrepreneurial business activities. We will make every effort to tackle tax avoidance, including detailed development of Liberal Democrat proposals”.

It is important that we remember all those words. A great deal of noise is coming from right-wing commentators, who are trying to chip away at this agreed programme of government, and indeed from Back-Bench Members of Parliament. I was both flattered and alarmed to be quoted by Mr David Davis in apparent support of his campaign against the coalition’s policy on CGT in a full-page article in the Daily Mail the other day, so I checked what I actually said. I was talking about the Tax Reform Commission of the noble Lord, Lord Forsyth, last year, and I am sorry that he is not in his place. I actually said:

“Raising the tax-free personal allowance, slashing fringe benefits and cutting business and personal tax rates by closing loopholes are all our priorities, too”.—[Official Report, 7/5/09; col. 677.]

That is what I said and what I say now, and it is the exact reverse of what Mr Davis implied.

Tax dodging in Britain is a deep-seated, pervasive, pernicious disease that infects our body politic and eats away at society. Of course, some of it has always gone on, and it is difficult to quantify, but I have been working pretty close to the heart of the City now for 34 years. I started at a time when tax rates were much higher than they are today, and I have no doubt at all that highly organised, aggressive, abusive tax avoidance, which used to be a marginal and rather spivvy operation that was frowned on by the main banks and institutions and shunned by top accountants and lawyers who were concerned about reputational risk, has now mushroomed out of all recognition.

Last month, a tax specialist at one of the big four accountancy firms, which by the way charge the British taxpayer hundreds of millions of pounds in fees for consultancy services, explained to me how they convert the hundreds of thousands, or indeed millions, that are earned every year by each of the partners in some of the main magic-circle law firms into so-called capital profits that are taxed at only 18 per cent. These same solicitors also charge the British Government and the British taxpayer millions of pounds for their advice. I do not know how these professionals, who pride themselves on their high ethical standards and high standards of corporate governance, look at themselves in the mirror in the morning. It is not just the private equity bosses who pay less tax than their cleaners.

Tax avoidance is obviously widespread in other areas. Last year, the Guardian exposed Barclays’ highly aggressive tax avoidance operations. Anyone who knows their way around the property market will tell you that precious few luxury houses or flats worth more than £10 million these days ever feature on Land Registry records with stamp duty having been paid. I am pleased to say that, with the support of many noble friends here, we have at least established that after 7 July no one can sit in this place who does not pay full British tax, but that just shows you what a battle this has been.

Taxing non-business capital gains at rates that are similar or close to those that apply to income tax will not just raise revenue to help low and middle-income earners; it is also essential in order to fight the tax-dodging cancer that is simply uncontrollable. There is a yawning gap between an 18 per cent capital gains tax rate and income tax rates of 40 or 50 per cent. As the noble Lord, Lord Lawson, said, CGT needs to be simple and straightforward, as it was under him in the 1980s. Taper relief, as Vince Cable has made clear, is an open invitation to avoidance. It is complicated and just does not work. I would like non-business capital gains to be indexed in line with the retail prices index so that you do not pay on gains over inflation, and to be included simply with income at whatever rate the individual pays. People of modest means would pay no tax on their annual exemption limit or 20 per cent above that, while those on an above-average income would pay a higher rate and pay more. Let us remember that the average income in this country is £24,000 a year. Only about 250,000 people have second homes, on which they have had substantial gains in recent years. Therefore, it is fair, right and essential that we stick to the whole coalition programme on capital gains tax and other things. I am sure that the Chancellor will do the right thing on 22 June.

18:30

[Lord Higgins]

My Lords, I congratulate my noble friend Lady Wilcox on her speech and on her appointment. I am sorry that she is not in her place. I assume that she has gone back to the department to make sure that Mr Vince Cable stays on the straight and narrow. We are relying on her to do that.

Looking back over the period of the Labour Government, one thing is absolutely clear; namely, that Mr Gordon Brown inherited the best economic situation ever inherited by a Chancellor of the Exchequer. As the former Prime Minister, he leaves behind the worst economic situation that we have probably ever faced. It is therefore crucial that we should proceed on cutting the deficit as soon as possible.

In that context, it is important to cut out wasteful expenditure. At a time when the Prime Minister is saying that we need to cut the size of the House of Commons to save cash, it seems to me that to move towards an elected and inevitably paid House of Lords is going in exactly the wrong direction. All that we would get in exchange would be a second-class House, which would not be as expert or as representative in terms of gender and race, and which would be whipped more and less able to defend the situation if the Government were to take excessive measures on human rights or whatever. I hope that we will avoid that increase in expenditure. It is not true, as Mr Clegg has said, that it would increase democracy. We already have 100 per cent democracy embodied in the House of Commons. Splitting it between the two Houses would reduce its effectiveness rather than increase it.

On taxation, I was very worried a few weeks ago when the IMF announced that the British indirect taxation system should be changed and that the zero rating on the most essential items for households should be eliminated and that they should be taxed. It is doubtful whether the IMF has any real expertise in this. Many years ago, I was involved in formulating the original VAT structure and had the difficult task of steering the whole legislation through the House of Commons. We spent an immense amount of time making sure that the structure of the tax was right. Over a period of two and a half years we published draft clauses, had pre-legislative consultation and had elaborate debates in the House of Commons. That produced the tax we now have. Whatever the Chancellor feels he has to do on the rate of VAT—when I was dealing with it it was at 10 per cent, but it may yet go to 20 per cent—he should not change the structure, which I believe is the best that we could have.

It is widely anticipated that capital gains tax will go up. If we are not to have a tax, because of inflationary gains, which is really a tax on wealth rather than a tax on a real capital gain, it is crucial that we should have either indexation or a tapering system, which existed under the previous arrangement before the Labour Government cut the rate. I am very worried that a number of people, particularly pensioners, may be taking mistaken decisions because they think that their gains will be taxed with no relief, and that then they will find out after the Budget that it was a mistake. I hope that the Treasury will indicate that there will be tapering or index relief so that people do not take mistaken decisions.

It would be very pleasant to have a long discussion on monetary policy, but I am running out of time. As I have said to the noble Lord, Lord Myners, on many occasions when our positions were reversed, it is crucial that we should have a clear policy on funding. It is extraordinary, but not generally understood, that the policy of quantitative easing has not led to any significant increase in the money supply. I am glad that I, as usual, have the assent of the noble Lord, Lord Myners. It would be very sad to lose him from the Front Bench. The Labour Government were immensely fortunate to have him as an expert during the banking crisis. Goodness knows what would have happened if he had not been there. We need a clear establishment of a situation where the funding policy is known. My very strong view is that the Debt Management Office should be returned to the Bank of England. We would then get a coherent attitude on monetary policy, which we have not had because the Debt Management Office has been frustrating the actions of the Bank of England on quantitative easing. If we do not have a steady growth in the money supply, we will not get the growth in the economy which is essential. Monetary policy has to be linked with the fiscal policy and the policy of cuts on expenditure and increases in taxation.

18:36

[Lord Whitty]

My Lords, this is a wide-ranging debate and I intend to say a few sentences about every area of it. First, I warmly welcome the noble Baroness to her position on the Front Bench. I am very gratified to see her there. Not only has she done the hard slog of opposition, but—I declare my interest as chair for at least a few more weeks of Consumer Focus—she was a distinguished consumer champion at the National Consumer Council. I am not entirely disinterested in saying this because I hope that she will ensure that her department, BIS, which has not always been that conscious of consumer issues, albeit that those issues are central to its remit, does not ignore the consumer dimension or the employee dimension. I also congratulate the noble Lord, Lord Henley, whose remit in Defra coincided with a little part of mine and that of the Lord Speaker before me. I think that the advice that we would give him is that nothing is quite as complicated as people tend to tell you that it is. I will leave it at that.

On the BIS part of the agenda, we have had references to financial regulation. Now that my noble friend Lord Myners is no longer influential in this area, I fear that we are not clear in which direction we are going. The banking industry and, above all, those who depend on banking services need to know what the future system of regulation will be. Will we abolish the FSA? Will we give a bigger role to the Bank of England? A commission is being set up to decide those things, but people want certainty. Above all, I hope that these issues are decided not on the basis of relatively arcane arguments about Glass-Steagall or whatever, but on the basis that we get a better service to business and to individuals from the banking system. We want more competition and more diversity, but not at the expense of less service and less choice to consumers.

There is a whole bit on regulation in the coalition agreement, in the manifestos and in earlier papers, particularly from the Conservative Party. Despite the fact that some of what the Government are arguing is sensible, the first thing that is picked out—the one-in, one-out process—is completely bonkers. The previous Government had a go at it. It cannot be worked in that way. There are other things in the programme on which the Government should focus. Looking at whole groups of regulation and the operation of a sunset clause for regulators would be much more effective than trying to have a first-in, first-out process. That is a bit of advice to those who believe in better regulation rather than less regulation.

On the Post Office, I was a bit surprised to see almost exactly the proposition of my noble friend Lord Mandelson, of which I was not entirely in favour, back on the agenda. I am not clear whether we are looking for capital for the Post Office or for a new organisation—presumably one of its competitors—to take over its management. Either way, we need certainty within the organisation. The employees need it, but above all customers, businesses and individuals need to know which way the Post Office is going. I am not at all convinced that the Bill that seems to be envisaged will do that.

On the environment and energy agenda, I have just two or three points to make. We need to pursue all aspects of the low-carbon agenda and, behind that, we need to reconvince the public that the fight against climate change is indeed one of the priorities of this Government and of society as a whole. There have been some rather unfortunate beginnings, but I hope that the Government can recover from them. The cut in help to business in terms of low-carbon investment is not a particularly helpful signal, nor is the dropping of part of the heat initiative. I am less confident than the noble Lord, Lord Jenkin, that dropping the Infrastructure Planning Commission will mean that nuclear power can play its proper part. I hope, therefore, that the concentrations on energy policy will be to provide not only for greener energy but also for a fairer cost of energy to consumers, whether they be businesses or individuals.

I welcome, I think, the commitment to the green deal, which will enable householders effectively to take out loans to improve the energy efficiency of their homes. However, that does not address seriously the position on fuel poverty to which my noble friend Lord O’Neill just referred. It will help a lot of middle-income groups and improve energy use among household consumers, but it will not tackle the problem of fuel poverty. We need a clear indication from the Government of where they intend to go on that front.

I am running out of time, so I will not go into detail on agriculture, which the noble Lord, Lord Henley, will no doubt be relieved to hear. On transport, the one thing that I want to do is to compliment the coalition on its decision not to go ahead with the third runway at Heathrow. That was a brave and important decision and I hope that the Government can follow through on the environmental agenda and on other decisions about the environment.

I was not going to mention this, but I shall, as the noble Lord, Lord Monson, who is no longer in his place, raised it. There is one apparently bad decision on the part of the Government. I do not believe that it is helpful to society or in the interests of rural areas to repeal the Hunting Act. I had some most unpleasant times in this House when I promoted the Bill. Straight repeal, which the Government seem inclined to allow via a Private Member’s Bill, is not a licensing system, is not a middle way and does not allow for local discretion; it is a straight repeal. That would be a regressive step by the Government and I hope that they do not give priority to it.

18:42

[Lord Low of Dalston]

My Lords, it is a pleasure to follow the noble Lord, Lord Whitty, and I, too, welcome the Ministers to their new positions. At the weekend I attended a lecture entitled, “Do we get the politics we deserve?”, which drew attention to the mixed emotions that the coalition has aroused. On the one hand we welcome the new politics of consensus and co-operation and of people working together for the benefit of the country. It would indeed be good if we could see a more bipartisan approach to the vexed question of social care and an end to the competitive auction on who can build and fill the most prisons. We breathe a sigh of relief at the prospect of stability and cheer on David Cameron as, like an auctioneer on speed, he knocks down the prized possessions of new Labour—going, going, gone. I welcome particularly the smack of firm government seen in the firing of the chairman and chief executive of the Student Loans Company.

Already, however, we can see the shine coming off as the Government begin to do the sort of things that Governments do: announcing measures to the media before Parliament; demonstrating the arrogance of power in a strident and partisan tone, so different from that of President Obama; tinkering top-down with the local government of Norwich and Exeter in a way that flies in the face of the proclaimed intention of pushing power downwards and outwards; and fixing the length of a Parliament in a manner that insulates itself against a loss of confidence. The answer to the last point is simple. Parliaments should be for five years unless the Government have first lost the confidence of the Commons. Lastly, the Government are threatening to swamp your Lordships’ House, which is already overloaded, with new creations in a manner that at one and the same time is unnecessary, runs counter to the Government’s longer-term aims and is antithetical to the spirit of the place. The Government have to be able to lose the argument. Will the coalition give rise, I wonder, to the canard, “Lloyd George knew my grandfather”? It will also be interesting to see whether Bills arrive here any better drafted and considered than before.

On the economy, the essentially parasitic nature of finance capitalism stands revealed for all to see. The noble Lord, Lord Skidelsky, spoke in this debate last year of the emergence of an insolent and largely footloose financial aristocracy or plutocracy as a direct result of the dominance of the financial services sector in our economy. I am amazed that this has not led to a greater crisis of legitimacy, for the shamelessness of the bankers far outstrips that of the expenses scandal. I suppose that the expenses scandal was a handy diversion. At all events, the crisis is still playing out. The markets coming after the banks is one thing—and it was a close-run thing—but we ought always to have been able to get over the meltdown in the financial sector when the banks had their Governments standing behind them. However, when the markets come after Governments, where do we go then? Have we now reached the bedrock on which the whole system rests?

We are certainly in a difficult position. Governments have had to raid their treasuries to an alarming extent. Even so, people question whether they have done enough and suggest that more might still be necessary. At this point, it is important to say that Gordon Brown has been unfairly criticised. The structural deficit was a manageable 2.6 per cent of GDP in the second quarter of 2008 when the recession struck and no one can seriously doubt that it was necessary to throw the kitchen sink at the problem at that point. Even so, the recovery is still fragile and the scale of renewed lending half-hearted. That being so, it seems to me a brave decision to take £6.25 billion out of the economy in 2010-11. I understand the need to reassure the markets, but I think that we should avoid turning reassurance into appeasement by buying into doomsday scenarios predicated on imminent bankruptcy and accept that a more measured approach not only is viable but may actually be less damaging. With the recovery still so tentative, at 0.3 per cent of GDP in the first quarter of 2010, taking 0.45 per cent of GDP out now runs the real risk of plunging us back into recession. It will certainly mean more job losses. David Blanchflower puts the figure at 140,000 and it should not be imagined that this can all be done just by freezing vacancies. Then there is the effect of the multiplier, which means that more jobs are lost because of reduced spending power. Recession costs much more to the economy in lost tax revenue and unemployment benefits than deficit reduction at a time of better economic growth.

It seems quite wrong that the ordinary citizen should be made to carry the can for bankers’ recklessness. With 55 speakers and still not half way there, I can give only the headlines, but perhaps I may mention five things that seem blindingly obvious even to a non-economist. First, there needs to be structural change. Retail and speculative banking should be separated. There is perhaps more to this than meets the eye, but the last Government were insufficiently robust on it. Secondly, we need a transaction tax. The sight of the bond markets opening in the middle of election night so that they could bet on the result was a barefaced example of the insolence to which the noble Lord, Lord Skidelsky, referred. Thirdly, those responsible for the deficit should pay proportionately more. Bankers’ bonuses, which amounted to £7 billion last year, should be subject to controls. Fourthly, contrary to what is frequently asserted, the UK has an internationally competitive tax regime. Taxation, particularly on high earnings, could afford to take more of the strain of deficit reduction. Finally, before general living standards are clobbered, it is imperative that big-ticket items should bear their fair share. I am glad that the defence review will include a wide-ranging review of Britain’s role as an international policeman—on Trident, I incline more to the Lib-Dem wing of the coalition—and it may be that economic necessity will succeed where penal policy has failed in reducing the demand for prison places.

If the coalition cannot adopt a balanced approach to getting us out of our present difficulties—recognising that we are all in this together—it risks undermining legitimacy and fuelling a widespread sense of injustice and even social unrest.

18:50

[Lord Moynihan]

My Lords, I warmly welcome the noble Baroness, Lady Wilcox, to her portfolio and congratulate both her and the ministerial team on the Front Bench today.

On the subjects of energy and environment raised by the Minister, I should like to address the specific question of the oil and gas business on the United Kingdom continental shelf, particularly in UKCS waters offshore, taking into account the recent Macondo oil well disaster and the loss of life in the Gulf of Mexico, and the previous disastrous Ixtoc 1 blow-out in 1979. In so doing I declare an interest: I have been a non-executive director of the Rowan group of companies based in Houston and today chair its HSE committee. Although we operate in the jack-up business, we are principally focused in natural gas, which is a very different market to the semi-submersible fleets used in ultra deep-water drilling such as BP’s Macondo oil well in the gulf.

It is clear that this is going to be an important issue for the Government and, in considering changes to our offshore oil and gas industry practice, I hope that in the light of the disaster we will all proceed with caution, consult widely and look to the industry as coalition partners when considering new measures for implementation on the UKCS, the vital objectives we should share for safe offshore working and the high priority to be given to environmental protection. The coupling of ultra deep-water oil drilling—in the case of the oil field operated by BP, 5,000 feet down in the Gulf of Mexico—with near-shore drilling projects would be unwise.

In this context, the US Government’s announcement of a moratorium on the approval of all new offshore oil and gas drilling permits failed to take into account some crucial issues which should be the subject of our attention in the North Sea—namely, that shallow-water drilling involves well developed and simpler processes for the extraction of energy resources. Notably, it has surface blow-out preventers. Jack-ups and shallow rigs in shallow water employ blow-out preventers above the surface of the water. These surface BOPs, which are so critical to safety offshore, are accessible for constant inspection, maintenance and repair and in emergencies can be controlled either remotely or by physical or manual manipulation. Access to their positioning above the water is very different from when the blow-out preventer is 5,000 feet down under water.

In the North Sea we focus extensively on clean natural gas. Shallow-water drilling sites predominantly involve clean natural gas resources with fewer environmental risks. The distinction between oil and gas in developing policy on this front is important. Also in the North Sea, wells in the shallow-water regions are drilled in predictable and mature reservoirs, and the reservoirs of greatest concern to us are the high-pressure wells. On the subject of lower pressure in the North Sea, a large percentage of the shallow-water rigs require positive external stimulation to produce the flow of oil and gas, significantly limiting risk or loss of control.

However, some key issues require consideration by the Government if we are consistently to ensure that our offshore drilling activities strive for improved safety levels. All safety cases now need to be reviewed, as should the legal and reporting processes to which they currently conform. These should cover both proactive and reactive issues in the context of safety, health and the environment and always be live documents and up to date. Detailed consideration could also be given to the design, capability and efficiency of the blow-out preventers I have mentioned. Their failure was the common denominator in both the BP well disaster and the Ixtoc 1 blow-out in 1979.

The time is now right for well control equipment and control systems to be further regulated. The HSE requirement in our country of a full inspection of all equipment every five years is too long—for example, Saudi Arabia has a three-year process—and well control training and certification should be regularly reviewed. An independent audit of the training programmes of the International Association of Drilling Contractors would also be welcome. Above all, absolute clarity in drilling operations as to who controls the well and who should shut it in is essential; the driller not the operator should always be responsible in this area.

Some of the measures I have proposed today would add additional costs to drilling companies, but these costs are surely worth investing in so that the oil and gas industry in the United Kingdom can work closely with government to ensure a safer, technically stronger and environmentally responsive energy sector both onshore and offshore.

In closing, I hope that BP’s chief executive, Tony Hayward, will not be sacrificed on the altar of American political expediency. He is a leader of exceptional quality and has reacted with authority, expertise and perseverance to an unprecedented disaster in ultra deep water. I wish both him and his colleagues well in resolving the technical and environmental challenges ahead.

18:56

[Lord Truscott]

My Lords, I, too, congratulate the Minister on her well deserved appointment. As Energy Minister in the former Department of Trade and Industry I had the privilege of working opposite the noble Baroness, Lady Wilcox, whose intelligence and tenacity I always admired.

Today I should like to address the issue of energy security, which was mentioned in the gracious Speech, and I look forward to seeing the proposed energy security and green economy Bill. I am pleased that it was included in the coalition Government’s programme for government, although I am still not clear how Ofgem is supposed to guarantee energy supplies—it would require a very long reach indeed—and I look forward to being enlightened when the debate is wound up. I refer noble Lords to my relevant interests as laid out in the register of interests.

As I documented in my recent Royal United Services Institute report on energy security, the European Union is becoming increasingly dependent on Russian supplies of gas as its mature fields in places such as the North Sea basin face decline and depletion. Short-term boosts such as the current gas price and potentially plentiful supplies of LNG or shale gas will not alter this basic fact although they may mitigate its impact.

Russia, as one of the world’s current three largest emitters of CO₂, behind the US and China, is part of the climate change problem and so must be part of its solution. However, despite the recent passage of the new energy saving and energy efficiency law, the Russian Federation is one of the most energy intensive economies on earth, projected to approach the US as the world’s top emitter by 2030.

There is an urgent need for EU member states to engage in coherent energy diplomacy. It is vital that the political and diplomatic status of energy security, which is closely related to climate, food and water security, is elevated to the top of the foreign policy and security agenda. Europe has woken up late to a new great game over energy. Playing out from central Asia to the Gulf of Guinea in capital cities and energy ministries, we are seeing producers pitted against consumers in a scramble to secure energy supplies.

“The rules of this game”,

suggests economist Joseph Stanislaw,

“are still being written, but its broad outlines are already clear. It is no longer confined to Central Asia—as was the original Great Game of the 19th century, pitting the British and Russian empires against each other”.

The Russia-Ukraine gas supply spats of 2006 and 2009 were a belated wake-up call to European politicians to the importance of energy security. Nothing concentrates politician’s minds more than when the lights go out.

Europe’s main gas suppliers are Russia, Norway and Algeria. Together they supply 84 per cent of gas imports into the EU. Russia is the most important single supplier. Oil and gas now account for 61 per cent of Europe’s energy inputs. Left unchecked, projected rates of consumption would see energy dependency on non-European sources grow from 50 per cent in 2000 to 70 per cent by 2030. By 2030, 90 per cent of oil consumption would have to be met by imports; gas dependency would rise to 80 per cent, with projected imports from Russia expected to reach 60 per cent; and two-thirds of coal usage would be met from foreign sources. Russia has the largest proven gas reserves in the world and the second largest coal reserves, and it is the planet’s second biggest exporter of crude oil.

Having first launched talks in October 2000, the EU and Russia have repeatedly attempted to establish an energy dialogue that will cement long-term Russian access to European consumer markets and European security of supply. This dialogue has struggled to advance.

In 2006, oil and gas accounted for nearly 50 per cent of Russian federal budget revenues, more than 60 per cent of exports and 30 per cent of GDP. Unlike Moscow’s Commonwealth of Independent States’ customers, the EU pays world prices for its Russian supplies. These have provided Russia with the bulk of its foreign exchange earnings. Europe also provides an important source of foreign investment in Russia and is an important market for expanding Russian companies.

However, Russia’s refusal to ratify the energy charter treaty and the transit protocol, a set of international rules for investment and trade in the oil and gas sector, has undermined European confidence in Russian energy markets as a stable source of supply. This was compounded by the fallout from Russia’s pricing war with Ukraine, which led to supply disruptions for downstream EU member states.

The best hope for the EU is to try to enshrine the principles of the ECT and transit protocol in a new partnership and co-operation agreement, whose tortuous negotiations have already restarted following the conflict in Georgia. Fears that Russia will seriously diversify away from the EU to other markets, principally China, look largely misplaced. Given Russia’s reliance on European consumer markets, the ability of Moscow to use energy as a weapon is severely undermined.

Europe should continue to press for liberalism at home, but within a rubric structured on areas of mutual interest; that is, energy, trade and investment. It is in these areas that the EU will get Russia’s attention and have most scope for shaping a pro-Western outlook. In this context, the EU should continue to support early Russian membership of the WTO and, later, the OECD to encourage Moscow to play by the international rules of the game, embracing market principles, free trade and reciprocal investment and legal rights.

19:01

[Lord Marlesford]

My Lords, in 1966, Iain Macleod said of George Brown:

“There is a society for being nice about Mr Brown and I pay my dues like everyone else”.

Our Mr Brown’s fame, if not his name, will endure, as has that of another in whose mouth ambition turned to ashes: the flawed hero of the Scottish Play.

However, Mr Brown did have two achievements. For the first eight years of his chancellorship, he was a prudent steward of the sound economic situation which he inherited in 1997. That had resulted from the radical changes made by the Chancellors of my noble friend Lady Thatcher: the shift to indirect taxation of my noble and learned friend Lord Howe and the 40 per cent top tax rate of my noble friend Lord Lawson. Mr Brown kept public spending on a tight leash. He thus contributed to Mr Blair's second and third election triumphs. We should perhaps forgive him a lot for starting so well. Secondly, he constructed a series of plausible excuses for keeping Britain out of the euro. It is an historic bequest.

But, today, a new cloud hangs over the world economy. The fatal internal contradiction of the euro has raised the spectre of sovereign debt default within the EU. A single currency requires economic management, and economic management is about more than monetary policy. It is now clear that countries sharing a single currency must be subject to an overall fiscal policy and thus a dimension of political union. Setting targets under the 1997 stability and growth pact is not enough.

There is little point in seeking to fine those who are going bust. They must either perish or be bailed out. In the euro area, the second is the only real option. The earlier arrogance of France and Germany, when they said that they were too big and important to be subject to the rules and escaped a fine, has not helped today.

For the smaller and more reactive countries, membership of the euro has merely masked reality from their Governments, the European Commission and indeed the international financial community. They have no interest policy to bother about, no exchange rate indicators of economic performance and little worry with inflation. They can borrow and spend to keep unemployment at bay. In Spain and Ireland, a property boom provided a mirage of prosperity. Italy has a subterranean economy, largely managed by criminals and protected by corrupt politicians. We may end up with a bi-valve Europe: the euro area with integrated economic management and the rest of us with much more economic sovereignty.

What is the lesson in all this? Surely it is that whether you are a family, a small business, a big bank or a Government, ultimate survival depends on prudent housekeeping. How right Mr Brown was to use repeatedly the word “prudence”; how wrong he was to abandon it. The top priority is now to reduce both the budget deficit and the government debt. We here must all help with ideas. Let me put in my pennyworth.

Some quangos are completely out of control. They need to be cut back drastically. Many have become irresponsible pressure groups. They waste taxpayers’ money on madcap schemes and impose huge compliance costs on the private sector and other parts of the public sector. Natural England is an example. Many of us remember last year, when it imposed on the Highways Agency a cost of £600,000 to erect bridges for bats over a new bypass in Cornwall. Now it wants to introduce, at considerable cost to the taxpayer, sea eagles to Suffolk, where they have never been and are neither needed nor wanted by those who are trying to make a living from the land such as pig farmers—I declare my interest as a Suffolk farmer, but not a pig farmer.

The Civil Service needs tighter management. The economic outlook will ensure no shortage of good candidates for a tougher Civil Service. First, from now on, those hired should be pensionable at 65 rather than 60. Secondly, on fringe benefits, why, for example, should civil servants have an extra day of holiday after every bank holiday, known as privilege days?

Finally, I have a proposal to reduce unjustifiably high salaries paid to some in the public sector. Applications for posts where the pay level is expected to be above £100,000 should be submitted together with a sealed tender of salary wanted. Applicants would still state their case for getting the post and the selectors would draw up a final shortlist. At that stage, the sealed tenders of applicants would be opened and the selectors could take account of the salaries asked for by the candidates. I suggest that this could lead to some remarkable results.

Let us be clear. Wasteful public spending cannot keep an economy afloat. But it can sink it.

19:08

[Baroness Kennedy of The Shaws]

My Lords, I, too, extend my warmest congratulations to new Ministers and wish them well in their roles.

Like others, I express concern at the policies that the new coalition Government are embracing to deal with the dire economic situation which our country faces. The financial crisis was the work of people in the financial sector who acted in their own self-interest without fear of either legal or economic reprisal. The most dangerous activities could have been stopped: securitisation, sub-prime mortgages, triple B mortgage bonds, collateralised debt obligations and off-balance sheet accounting. Undoubtedly there were people who were blinded by the murky convoluted signs of it and just did not understand what was going on. The regulatory agencies proved toothless, also unable to fathom half of the machinations. People who sat on boards never queried the madness of it, too fearful perhaps about looking foolish but happy to pocket their remuneration. Men were chairing banks who had no experience of banking and thought that running a bank was no different from heading a PR firm—and who boasted, socially, that banking was “such fun”. Then there came the fall.

Some auditors need to account for their shameful failure to do any real accounting. Commercial lawyers also played disgraceful roles, pocketing fees for running their eyes over and signing off nefarious transactions. All these people were uninhibited by any moral scruples. People knew that the market was being rigged but were more interested in making money than in challenging the system. Why do I say with such confidence that they knew? Because one of the givens in life is that we all know that there is a reward-risk ratio, and the higher the rewards, the higher the risks. I recommend to this House a book called The Big Short: Inside the Doomsday Machine, by Michael Lewis, which carries a very good analysis of the cataclysmic period that we have just been through. The people who bore the risks were none of these masters of the universe I have just been speaking of. They were remunerated handsomely and demanded such handsome reward on the excuse of being risk takers. The people who bore the risks were ordinary members of the public, persuaded to take on mortgages far beyond their capacity to repay and now, as taxpayers, having to be responsible for the bailings out. They are the people being charged high interest rates and the people who are now not able to get bank loans to set up the small and medium-sized enterprises that are so loudly extolled.

Those who have suffered are inevitably those in the lower ranks of the banks. The financial sector ran wild under deregulation, bringing a crisis that is leading to remedies now in which the Government are invoking massive cuts which will fall on the shoulders of ordinary people. The call for debt reduction and massive cuts without first rebuilding the banking system carries the risk of taking us back into recession. We should be re-establishing strong growth and high employment. When people are employed, they buy things, and when people are buying things we are feeding our economy. When people become unemployed, they become a debt to the country, because we have to make sure that there are benefits at least to keep them out of some levels of poverty.

It is business as usual for the banking sector. The cuts and paying back of debts will inevitably fall disproportionately on the shoulders of ordinary people—those who work in hospitals, such as porters and nurses, as well as community centre workers, nursery school workers and so on. They are the people who will be confronted with unemployment and they will feel the greatest pain of swingeing cuts and reduction of services. My concern is that the new coalition Government will not be concerned enough about the whole issues of taxes and fairly sharing out responsibility for getting this country back into some sensible situation.

If we have learnt anything it is that capitalism and markets have to be properly regulated if we are to live in a decent, civilised society where the gap between rich and poor is not obscene. Markets are without morality and it is for government to inject the moral component into them. We should look at not just a decent minimum wage but a decent living wage for people. At the other end of the scale, we should be talking about the creation of a high pay commission. There was something wrong when in 1990 a review of salaries found that chief executives in companies were earning 55 times more than the average worker in those same companies. In just 10 years, by the year 2000, CEOs were earning 600 times more than the average workers in their companies. The Spirit Level, a book that has been invoked so often in this House, says that a country where the gap between rich and poor is high is inevitably a less happy place to live in.

What do we do about the banks? The Glass-Steagall Act was introduced in 1933 and was designed to control speculation, preventing commercial banks, which took the deposits of ordinary customers, from embarking on risky trading activities. We, too, should separate out high street retail banking from the risky casino banking activities of the investment banking sector. The large banks should also be broken up into smaller entities, as Nouriel Roubini, the economist, who foretold this crisis, is now recommending.

There are many things that this Government could be doing. The noble Lord, Lord Low, spoke of the way in which, if care is not taken, we are going to drive many more people into poverty and the divisions in our society will become greater. This new Government came into existence speaking of a “broken society”. It was not a view I shared; I happen to believe that Britain is a society rich in social capital. But the divisions will be great if we do not deal with this crisis in a humane way, where the pain is shared by all.

19:15

[Lord Bradshaw]

My Lords, I am going to speak about the bus and rail industries, in which I have no financial interest, although I have spent my whole professional career there. I want to talk about the financial problems facing the Government. First, I utter a word of caution about fares. The elasticity of demand in both transport industries is such that if you put up fares by 10 per cent you lose on average 13 per cent of the passengers, so you have less money in the till and fewer passengers—hardly a recipe for success.

Costs must be cut. I ask the Minister to say something about Network Rail, which is spending huge sums of taxpayers’ money and is inefficient, complacent and expensive. I believe that legislation is necessary to bring this organisation, which was created by the party opposite, under some sort of control. It is essential that it spends less money. Secondly, the train operating companies and rolling stock companies are quite ready to review straightaway the timetable and deployment of rolling stock, in the interests of greater efficiency and getting much more into the kitty.

It is necessary to delay the refranchising of three franchises—CTC, Greater Anglia and the East Coast. They are due to be refranchised soon, yet the Government have said, and we have supported the view of the Conservative Party, that we need a new franchising model, which will bring a lot more investment into the industry, because I cannot see that coming from the Government. I believe that the train operating companies and the rolling stock companies are quite capable of managing the fleet and the cascading of rolling stock within the fleet and might embark on a programme of life extension and refurbishment, which would create a lot of jobs in this country, rather than buying new trains from Japan, a process which the previous Government set up. They are unnecessary and unwanted and very expensive. We could make do with what we have, because it has a lot of life in it.

We should review the Thameslink and Crossrail service patterns. We need both, but do we need to run 12-coach trains through Thameslink at 24 trains an hour? That is a huge amount of capacity, and I am sure that it is too much; a rigorous appraisal needs to be made of the number of trains running and where they are going to. At the west end of Crossrail, people almost do not know what to do with the trains.

I welcome, of course, the work being done on high-speed trains. I believe that the electrification programme from the railways needs to be thoroughly reappraised. Although I live in the region of the Great Western and obviously speak in an audience of Cornishmen, I would say that say that electrifying the line west of Oxford is unnecessary, at least at the moment. We should concentrate our electrification on those lines where the cash flow is best, so that we buy the things that would give a return quickly, not spend money on things on which the return is problematic in future. We need to purge the rail division of the Department for Transport and almost forbid it to employ consultants. We should stop using the new approach to transport appraisal as a means of assessing transport schemes. It is inordinately expensive and complicated and, as an economist, I gave up reading the thing after page three. It gets so complicated that it is not an efficient guide as to where we should spend the money.

I agonised quite a lot over the question of buses. The concessionary fares scheme was never properly funded by the Labour Party and has been a constant source of trouble to both operators and local authorities. The age at which concession is available needs reviewing, and we might have to do the very unpopular thing of charging concessionaires 25 per cent of their fare in order to bring the system back into balance. Of course I would make exceptions for the disabled, the over-80s and various others, but the vast bulk of people would rather pay something towards the cost of their travel. A recent survey asked people how the scheme had affected their lives and one of the prime answers was, “We walk less”. I am sure that that was never in the minds of the people who designed the scheme.

Lastly, there is the issue of heavy lorries. Foreign lorries are using our roads and not paying, and we should do something about lorry-user charging to get more money in the kitty.

I hope that I have given the Minister a few ideas about how to save money in the areas that I know about. I am sure that other noble Lords could do the same.

19:21

[Lord Broers]

My Lords, I, too, take great pleasure in congratulating the noble Baroness, Lady Wilcox, and the noble Lord, Lord Henley, on their new appointments.

I shall speak to the first priority of the Government as set out in the second paragraph of the gracious Speech: the reduction of the deficit and the restoration of economic growth. As an engineer, I certainly do not have overall solutions to these immense problems, but I feel strongly that there are actions that we must take if there is to be any chance that we are to resolve them, and there are things that we should not do.

I shall start with one of the latter. We must not go on being afraid to face the magnitude of the problem, perhaps on the assumption that we will frighten people or be thought to be talking down the UK economy. The public and our partners and competitors overseas are not innumerate; the numbers are starkly clear for all to see. No matter how one tries to define “structural debt” as opposed to “cyclical debt”—the economists differ on this—our structural debt is several hundred billion pounds higher than would normally be accepted for a healthy economy. Before we can start to reduce the structural debt, the economy will have to recover so that the cyclical debt is contained and annual deficit eliminated. Even if we allow ourselves 10 years to recover, the annual sums of money needed to close the gap far exceed £100 billion, and may approach £200 billion. We have to get on with it—after all, the £6 billion that has caused so much anguish offsets only 14 days of borrowing.

Faced with these apparently insurmountable debts, what do we do? It is unlikely that we can find the sum needed in savings, no matter how savage the spending round, and only a limited amount can be raised by increasing taxes if the nation is not to revolt. We are going to have to get the economy growing again. I agree with the Prime Minister that there is no other course but to place much more emphasis on manufacturing. The question is: how do we do this? We could risk generating runaway inflation and further devalue the pound. After all, in 2008, on the previous Government’s watch, the pound was devalued by a staggering 25 per cent, much to the relief of industry, even if it demonstrated the weakness of our economy compared to others. Further devaluation might increase the competitiveness of industry and improve the balance of trade, but naturally it would make funding our deficit prohibitively expensive. Short of providing an unrealistically weak pound, we will have to find incentives that encourage investment in new ideas, and lower cost and more efficient funding for industry than is being provided by our banks. After all, banks that hugely reward their employees and at the same time aim to make large profits have to make all that money out of someone, and of course it is generally their customers.

To improve our industrial performance we must first develop a rational and competitively priced energy strategy, as mentioned by the noble Lords, Lord Lawson, Lord Oxburgh and Lord Jenkin. We must also make better use of our educational system and our science and engineering research base. Mike Lynch, one of our most successful entrepreneurs, recently said in the Times:

“If you look at the calibre of our students and the competitive advantage they bring, we should have a raft of internationally successful technology companies. Instead, there are only two software companies … in the FTSE 100—Autonomy”,

which is Mike’s company,

“and Sage. Our ambition should be to have … ten. Without technology companies the UK economy will be in massive trouble”.

A proposal that should help create high-technology companies has been made by Dr Hermann Hauser in his recent report to the former Secretary of State at the Department for Business, Innovation and Skills, The Current and Future Role of Technology and Innovation Centres in the UK. Dr Hauser proposes that the UK develops a translational infrastructure similar to that used in other countries that greatly benefits their economies by building bridges between universities and industry. At the moment our expertise in many subjects is scattered across the country in many small centres, few of which, if any, attain international levels of competitiveness in technology transfer. Hauser recommends that we concentrate our expertise in general areas such as stem cells and regenerative medicine, future internet technologies, plastic electronics, software, technologies addressing renewable energy and climate change, satellite communications, fuel cells, advanced manufacturing and composite materials. These should be concentrated into a handful of centres that are internationally competitive and attract the serious involvement of industry.

We have to do all that we can to encourage and support our manufacturing industry. After all, despite neglect, it still adds more than £l50 billion a year to the UK economy, accounts for half of exports and represents 13 per cent of gross domestic product. However, as Dick Olver, chairman of BAE Systems, has pointed out recently in the Financial Times, these statistics mask disturbing trends. Since 1970 the UK has suffered the sharpest decline in manufacturing as a proportion of employment of any advanced industrial economy. Olver goes on to say:

“Without action, that trend is likely to continue and, in a global environment, big companies will have fewer reasons to favour the UK when deciding where to invest”.

Other data produced by the ERA Foundation show that over the past decade our trade balance in finished manufactured goods has declined, at an average rate of 20 per cent a year, from a position of rough balance to a deficit of £55 billion. We need to reverse these trends if we are to recover our economy.

19:28

[The Lord Bishop of Liverpool]

My Lords, thanks to the Benches opposite, the United Kingdom has established its reputation on the world stage as a leading voice on climate change. It is the hope of many on these Benches that the new coalition Government will continue to show strong international leadership by what the United Kingdom says on the global stage as well as by the way it rebuilds a green economic recovery.

In the run-up to the election the Green Alliance’s report, The Last Parliament, made a powerful argument that now is the time for action. The report reminds us that over the next five years Parliament has the last opportunity to take action on the national and international stage and prevent runaway climate change. Failure to stabilise emissions in that timeframe will dramatically reduce our chances of keeping global warming below the predicted 2-degree rise in global temperature. The Government have declared that they want to be the greenest Government. This is not simply a desirable ambition; it is an essential requirement for a secure future.

I am interested to see how the Government’s plans will impact on the north-west of England. The region is the most renewable-energy-rich region in the United Kingdom, offering opportunities for its continued economic development, especially with the creation of green jobs and green economic growth, as well as contributing to the national economic recovery. We therefore welcome the plans for setting up the green investment bank. I hope there will be many branches in the north-west. However, it is with great concern that we learn of the intention to create local enterprise partnerships to replace the regional development agencies. The RDAs have a long track record and, especially in the north-west, have been an investor for—and not a cost to—central government. The NWDA’s investment in projects resulted in a net increase of wealth of £5.20 for every £1 invested. In 2009-10, the NWDA played a pivotal role in attracting more foreign investment to the region than any other outside the south-east, creating or safeguarding more than 14,000 jobs. The point of mentioning the RDA in a speech mainly about the environment is that the RDA is the key to developing a renewable energy strategy and green jobs in the regions as a major part of the development of the UK’s renewable energy strategy.

The UK faces challenging targets for carbon emissions. We cannot achieve these without the close integration of infrastructure planning, economic growth and energy generation. The proposed abolition of the regional spatial strategies seems to remove the mechanism to align infrastructure priorities with economic potential. We have a national requirement to develop a sustainable, reliable, renewable energy supply. The development of the national infrastructure must contribute to this. It is important that the Government replace the Infrastructure Planning Commission with a system that is not just, as they say, efficient and accountable, but that counts the carbon of new infrastructure planning. I have argued for this in previous debates and will continue to make the point that planning permission must take account of the carbon footprint; otherwise, it drives a coach and horses through any strategy for reducing our carbon emissions.

There is no mention of nuclear power in the gracious Speech. We must avoid falling into the trap of believing that nuclear is our primary and easiest energy solution. I share the concerns expressed about nuclear energy by the Secretary of State. I question the development of nuclear energy on the grounds of proportionality. The energy consumption of one generation burdens 100 generations with the problem of dealing with the waste. I urge the Government to strive for a rich energy mix, including the abundant—and as yet almost entirely untapped—renewable energy sources around our country. For example, up to 20 per cent of the electricity required by the United Kingdom could be provided by the waters and tides of our coast, predominantly on the west of the UK.

At home, the Government have an important role to provide the initiative for changes in lifestyle. I hope the government policies, such as establishing a full system of feed-in tariffs and encouraging home energy efficiency improvements, will encourage people to change their lifestyle. Without a change of lifestyle, the policies themselves will not deliver. The climate of political opinion on climate change has changed radically over the past five years. Through the new Government’s legislative programme, the momentum must be sustained if the climate of opinion and action is to change more quickly than the climate itself.

19:34

[Lord Reay]

My Lords, although they are not present, I pay tribute and express my thanks to the Ministers with whom I had to deal in the previous Government on energy, environmental and planning matters—the noble Lord, Lord Davies of Oldham, and, in particular, the noble Lord, Lord Hunt of Kings Heath. They were models of what Lords Ministers should be: immensely skilled in debate, extremely conscientious, and—possessing perfect manners—they ensured that the debates they led were always a pleasure for those who took part in them. I hope that we can produce Ministers worthy to tread in their footsteps; I am sure we will. Looking further ahead, I hope that we will never introduce a reform to this House that will make the achievement of their high parliamentary standards less likely.

I have no problem with being in a coalition. I once sat on the Liberal Benches. A coalition, of course, has differences of opinion within it. However, in one area, unanimity unfortunately reigns, with dangerous possible consequences. I refer to the policies on energy and climate change. Indeed, the coalition policies in that area differ little, if at all, from those of the previous Government. If anything, they aim to go further in the same direction. For example, the coalition’s programme promises support for an increase in the EU carbon emission reduction target from 20 per cent to 30 per cent over 1990 levels by 2020. Last week the European Commission pushed this proposal until, under pressure from France and Germany, it was forced to retreat, despite the support for the Commission from our own Secretary of State. The Commission was apparently attracted by the funds that it would be able to raise by selling additional carbon emission certificates. In other words, it was seen as a revenue-raising tax on industry. How can that possibly be sensible in the present circumstances?

The fact is that in our present economic predicament, the private sector, including our manufacturing industry, needs to be given every encouragement to restore growth to our economy. The whole point of being out of the eurozone is surely to be able to take advantage of our lower costs in world markets. No cost is more significant to industry in determining its international competitiveness than that of energy. How, then, can we afford an energy policy that promises extravagant additional costs for private customers and business alike, the effect of which can only be an increase in fuel poverty; the destruction or emigration of industry, with consequent further job losses; and the threat that the lights will go out as we persist in promoting inefficient means of producing electricity?

Governments are fond of claiming how many jobs they will create through their various schemes to promote green energy. They do not speak about the fear of the far greater number of jobs that will be lost in other sectors as a result of the increase in costs imposed on the rest of industry by the expense of the subsidies. Moreover, jobs in industrial sectors which depend for their very survival in all countries on government subsidies are exceedingly vulnerable, as we are beginning to see. Not surprisingly, across the developed world, those subsidies are now having to be reined in, with consequences that are entirely predictable. In this country, the Secretary of State says that there must be no subsidies for nuclear energy. Fair enough—that was also the policy of the previous Government. The eventual cost of decommissioning nuclear plants should be factored into the lifetime costs of power stations and paid for by energy companies. There should be a level playing field as far as possible, with industry choosing the most efficient technologies. However, in that case, why should wind power be subsidised? It has had plenty of time to reach maturity as a technology and prove that it can stand on its own feet, but it has failed to do so. The previous Government repeatedly had to raise the subsidies for offshore wind to have any hope of meeting their renewable energy targets, and did so again in April of this year. It is just the latest example of how Governments cannot resist picking not winners but losers.

The next example will very likely be solar power. Here we should be warned by what has happened in Germany. Germany, like this country, does not have a notably sunny climate. Nevertheless, thanks to feed-in tariffs, it has more solar power capacity than Spain. According to a study published last year by Ruhr University, which I have quoted before in this House, by the end of this year it is expected that more than €50 billion will have been spent on subsidising solar power in Germany, yet in 2008 solar power produced a paltry 0.6 per cent of Germany’s electricity. Sadly, however, we seem to be setting off down the same road. The coalition programme promises to introduce a full system of feed-in tariffs. However, the Prime Minister stunned everyone with the leadership he showed in establishing the coalition following the election result. In other respects also he has showed pragmatism and an ability to free himself from dogma. Let us hope that in the field of energy too he will eventually embrace reality and abandon childish dreams, and do so before disaster is brought down on this Government and this country.

19:40

[Lord Desai]

My Lords, I shall miss my noble friend Lord Myners and the noble Baroness, Lady Noakes, but I welcome the new team, whom I have known for a long time and shall have fun attacking.

Unlike many of my noble friends, I have always taken the view that the deficit has to be tackled and, along with 19 other economists, signed a letter to the Sunday Times to that effect. The noble Lord, Lord Skidelsky, then found an army of many more economists to demolish my case, but we shall see. The important point is that we should debate the timing of deficit reduction, not the need for it. Even on timing, the choice is not as wide as people think. We are in the midst of a recovery. Growth in the last quarter of last year and the first quarter of this year was fragile, but the figures have been revised upwards. We will most likely have a growth rate of around 1.5 per cent to 2 per cent this year. When the right honourable gentleman the Chancellor of the Exchequer announces his emergency Budget, it is important that he ensures that the path of deficit reduction is properly laid down without any confusion and that he makes it contingent on a certain growth trajectory. When the Office for Budget Responsibility checks the growth figures, I hope that it will follow the practice of the Bank of England and produce a range of likely growth figures, because we need to think about the uncertainty surrounding those figures and then look at the timescale of deficit reduction.

I produced a paper before the election with Peter Kenway of the New Policy Institute in which we calculated the rate at which the deficit would have to be reduced to bring down the share of spending from its present high figure of 44 per cent of GDP to, say, 40 per cent, which is what it was in 2002. The most important element in that calculation is that just keeping real current spending constant—zero growth—and relying on growth to bring in revenue may be a good and cautious strategy to begin with. If even that much is done, it will be good. What people historically call cuts in government spending in the UK are not actual cuts but occur when the growth of current spending is less than the growth of GDP. The growth of GDP will have to be watched carefully; at the minimum, to have constant real spending would be a good strategy.

The Liberal Democrat proposals for fair taxation are extremely muddled. The Liberal Democrats are good-hearted people but they have not really thought this through. In order to take about 2 million people earning between £6,500 and £10,000 out of taxation, they are giving another 20 million people more money than they are giving to the people whom they really want to help. People earning above £10,000 will get £700 guaranteed, while people at the lower end of the scale will get somewhere near £700 at most. If you help only the 2 million lower paid, that will cost £1.5 billion, but taking this course would add another £15 billion of cost for those who do not deserve the extra money. That is not fair; it is regressive and expensive. There is a simple way of achieving something better, which is not to raise the personal allowance but to give people who earn between £6,500 and £10,000 a tax rebate. In that way, only those people would get a tax rebate, not the rest. I suggest an even better measure—I have written about this and I hope that it will appear in print very soon—which would be to abolish the personal allowance altogether and convert it into a tax credit. Everybody would get a tax credit equivalent to the basic rate of taxation times the personal allowance, which is £1,300 in today’s figures. The advantage of that is that people who earn less than £6,500 who do not now pay tax would pay negative income tax and get a credit. In that way, you would help the really poor people through the taxation mechanism to a far greater extent than we are doing now.

It is a good idea to integrate income and capital gains in a single taxation framework. However, you should do that consistently. I suggest that the 20 per cent and 40 per cent rates be incorporated in the capital gains part of tax as well.

The noble Lord, Lord Higgins, decried the fact that the IMF has suggested that the zero rating of VAT be abolished. I proudly say that the IMF has at last seen the sense of what I was saying 17 years ago, for which I was sacked from the Labour Front Bench. That is not a bad lag for the IMF. I wish that the Government would catch up with the IMF and abolish zero VAT rating. If you are to cut the budget deficit and the debt, you have to choose carefully whether it is not better to increase taxation in certain respects rather than to cut spending. It is a fine balance but I have never understood the holy-cow nature of zero rating of VAT on children’s food, which contains far too much sugar and salt. Tax it and we will get a healthy population.

19:47

[Lord Skidelsky]

My Lords, I congratulate the Minister, the noble Baroness, Lady Wilcox, on her appointment to her important new responsibilities. I regret only having to turn my head to the left rather than the right to get the full flavour of the masterful performances of the noble Lord, Lord Myners, that I have come to expect and which, indeed, we got today.

In the Crimean War, it is said that Lord Raglan, a veteran of the Peninsular War, announced his plan of campaign to the assembled commanders by pointing to the map and saying, “We attack the French here”, at which point an aide whispered to him, “Sir, the French are our allies”. I trust that members of the coalition will not be afflicted by a similar cognitive dissonance.

The Government have already announced £6.2 billion of cuts, and further cost-cutting is promised in the emergency Budget of 25 June. Contrary to the noble Lord, Lord Desai, I believe that these will be real cuts if growth does not take place. That is why I would not make them until we have much firmer evidence of recovery than we have at the moment.

Why this stampede to austerity? The basic reason is a visceral, if vestigial, puritanism. We feel that more spending cannot be the answer to having spent too much already. Peter Oborne summed this up well in the Daily Mail. He said:

“Borrowing to save the economy is like trying to sober up a drunk by giving him a large whisky”.

The Chancellor said much the same some six weeks after the collapse of Lehman Brothers. He said:

“Even a modest dose of Keynesian spending”,

is,

“a cruise missile aimed at the heart of the recovery”.

That was in October 2008.

I have long argued that such propositions would be true if the economy was at full capacity. The boom is the time for belt-tightening. However, these propositions are not true for today. Everyone knows that output and employment are severely depressed. The OECD has calculated that the UK’s output gap is 5 per cent. Does the noble Lord, Lord Henley, agree or not agree with that estimate?

In my judgment, we are experiencing a good, old-fashioned Keynesian demand-led recession, which requires a good, old-fashioned Keynesian response. As Nobel laureate Paul Krugman writes:

“Both textbook economics and experience say that slashing spending when you’re still suffering from high unemployment is a really bad idea. Not only does it deepen the slump, but it does little to improve the budget outlook, because much of what governments save by spending less they lose as a weaker economy depresses tax receipts”.

By what mechanism do the Government believe that cutting the deficit will promote recovery? The usual argument is that it will restore business confidence. Surely the best way to do that and to reduce the deficit is to increase total spending from the low level to which it has fallen. The projected deficit has already shrunk from £176 billion to £156 billion without any change of policy. It will continue decreasing gradually as the economy recovers, unemployment shrinks and revenues grow.

The way in which the stampede for austerity has built up is frightening. I have yet to find a single solid reason for cutting the deficit now, especially in view of the disaster threatening to overwhelm the eurozone. People talk about the need to pay attention to the psychology of the markets. However, no one who has made any money on the market believes for a moment that financial markets are capable of judging risk accurately. As Warren Buffett said:

“A pack of lemmings looks like a group of rugged individualists compared with Wall Street when it gets a concept in its teeth”.

That is why politicians and public officials have a particular responsibility not to try to second-guess the financial markets by threatening disaster if certain policies are not followed. They do not know what the financial markets will think and, by playing up the risk of default or inflation, they can create a dangerous self-fulfilling prophesy—exactly the type of momentum that they do not want. If the markets believe what the Chancellor has been saying for the past year or so, they might make it impossible for him to eat his own words.

It is a tragedy that the very financial system that has recently been bailed out by the taxpayer is treated as the arbiter of fiscal policy—using the very deficits and debt that they have foisted on us as the pretext for savage fiscal cuts in recession. Regrettably, I do not agree with the noble Lord, Lord Lawson, that deficit reduction should take precedence over any other policies, but I agree with a famous predecessor of his, Winston Churchill, who, as Chancellor of the Exchequer, said:

“I would rather see finance less proud and industry more content”.

19:54

[Viscount Eccles]

My Lords, the noble Lord, Lord Skidelsky, has entertained us with much the same thesis on a number of occasions, but I wonder whether he does not exaggerate. He talks about the age of austerity; I suppose that he is referring to £6.25 billion of expenditure cuts, but the previous Government were, if I remember rightly, going to make £5 billion in efficiency savings. I suppose that economists would tell us that there is not really very much difference in outcome between cuts and efficiency. We will always live with economic uncertainty, but the question is: how capable are we of dealing with that uncertainty? All that we know for certain is that our economy is some 10 per cent smaller than it would have been if matters had proceeded smoothly, and that our structural deficit is unsustainably high. It may well be best if the pace of the deficit reduction was contingent on the pace of economic recovery. However, recovery first and debt management second is not a viable choice. It is always necessary for the two to proceed in tandem.

The Bank of England’s view of the near future re-emphasises the uncertainties. A 2 per cent central position between inflation and growth is so widespread between nil and 5 per cent that it amounts almost to a “don’t know”. In a period of such uncertainty, a mechanistic and one-solution analysis is of very limited use. The most favoured and oft-repeated parallel is the 1930s, because it is Keynes of 1936 who gets the star billing. I will not speculate upon how different his General Theory would be if written today. However, he would certainly take into account very differing circumstances—the most striking of which are the welfare state and the rise in per capita income which, in real terms and taking some account of lifestyle changes, is more than three times what it was in the 1930s. The economy of today is therefore radically different from that of the 1930s. Who, we might ask, is expecting Jarrow marches or some repeat of George Orwell’s The Road to Wigan Pier?

The underlying strength of today’s economy, its relative wealth and our welfare state mean that we can face up with flexibility to the judgments that need to be made as events take their course in a global economy. Our economy, even at a time of fragile growth, provides the room to take action and then to see how the unknown balance between economic recovery, indebtedness and inflation develops. We need to find out how much better we can do when the responsibility for finding solutions is shared between the centre and the many institutions which serve the people. We need to see how people react to changing circumstances. Many will solve their own problems.

The coalition is committed to fairness—equity between all members of our society—as we find our way back to economic and fiscal stability. I strongly support the test of fairness and carefully assessing public reaction. Despite the extraordinary mess which we are in and despite the absurdly centralised and bureaucratic mistrust of the people that we inherit, we will be agreeably surprised by the response to tough decisions and we will be able to promote fairness. I strongly support an increase in the personal allowance. It is right to replace the mechanistic, top-down and money-throwing recent past with freedom, fairness and responsibility.

19:59

[Lord Hunt of Chesterton]

My Lords, I, too, congratulate the coalition on its pragmatic pro-European and pro-nuclear policy. I am still waiting to see a European flag flying over our Parliament, as it does over others in Europe—although some Lib Dems believe in that. There were many good points in the speech of the noble Baroness, Lady Wilcox. It was a very green speech, and I look forward to seeing her influence in future.

I will comment on the points made in the Queen’s Speech about manmade climate change and economic recovery. Both are serious tasks, but there has been something missing in today's debate. I say to noble Lords that the huge government investments in the UK in the past 13 years have had a dramatic impact on the environments of the most depressed areas. That money was extremely well spent, and we should recognise that. I saw much of this in the recent election campaign in the West Midlands.

I declare my interests as a former professor of climate change, and the director of a small consulting company. As to the remarks of the noble Lord, Lord Marlesford—I am sorry that he is not in his place—I was a senior civil servant and I always flew economy class. Not all civil servants travel first class.

The rise in global temperatures during this century is a very serious matter. Several climate centres, including the Met Office, the Danish met office and the Chinese met office are predicting that the result at the end of the century will be nearer 4 degrees than the 2-degree target agreed at Copenhagen. It would be possible to keep to the last figure only if worldwide carbon emissions stopped growing. Because of the complexity of climate change science and policy—as the noble Lord, Lord Lawson, emphasised—we must have more open discussion. Scientific and engineering aspects must be considered. The Royal Society and others now advocate that.

Policies to deal with the situation must be international and realistic. However, they probably cannot be based on a Kyoto-style global agreement, as we saw at Copenhagen. One might compare the UK's ambitious plan to reduce emissions by 80 per cent by 2050 with China, which has stated in many public remarks that while its energy may be more efficient it will double emissions by 2050. Nevertheless, as the noble Baroness, Lady Wilcox, said, the UK must collaborate and trade with all countries of the world, particularly those which are rapidly industrialising. One way in which we can do that is through our development of nuclear power, and through R&D into future technology. I part company slightly with the interesting remarks of the right reverend Prelate the Bishop of Liverpool in believing that future nuclear technology will enable us to eliminate waste. An article in the New Scientist explains this.

As the EEC Commissioner for Climate Change recently commented when she came to London, carbon trading is now operating as an important aspect of making industry more efficient and stimulating energy emission reduction. In China, there are about five or six centres. There are others in the north-east states of America, and on its west coast. This may be one way in which we will find practical methods for reducing emissions. These should also be complemented by policies in the cities of the world. They are the areas where there is a maximum usage of energy, and policies have begun in London and around the world. We heard last night from the mayor of Mexico City, who was visiting London, about its remarkable policies, working with other cities. Policies to reduce carbon emissions can be similar to those for reducing air pollution, which is a major issue for people living in the cities of the world.

The Government should also, in the most cost-effective way, not only negotiate with other Governments and encourage cities, but work with United Nations specialised agencies, which are continuing. They were given leave to continue by the Copenhagen meeting. The World Meteorological Organisation is monitoring the climate. The Food and Agriculture Organisation is working on forestry. The International Maritime Organisation, the other side of the Thames, is working on reducing pollution from shipping. This is very cost effective, but gets little publicity in Parliament.

I will also comment on the work of the Department for Business, Innovation and Skills, which we have been discussing this afternoon. These three strands come together in government policies for research in industry, which the noble Lord, Lord Broers, emphasised. High-tech companies in the UK have made many comments about the importance of maintaining the taxation policies of the previous Labour Government, to provide tax relief for research in industry. Again I declare an interest as director of such a company. For example, a professor of chemistry at Cambridge explained how this had been essential for the establishment of several companies.

Another aspect of the previous taxation policy was to provide much better maternity benefits to companies through the taxation policy. This has enabled women to have much longer and more successful careers in high-tech companies. I am sure that the noble Baroness, Lady Wilcox, will approve. Finally, I again approved of other remarks that she made because they so departed from the policy of the Minister of her party in the 1990s. When I expressed the need to use government purchasing power to develop technology, a very senior Minister in the Major Government said that that was something that they did in France. I am glad that that is something that they now do in England: good luck to them.

20:05

[Lord Smith of Clifton]

My Lords, I thank my noble friend Lady Wilcox for introducing today's debate on the gracious Speech. She is the Minister dealing with business in this House, and I congratulate her on that and wish her well. Indeed, she and her portfolio are both highly relevant to the topic I will discuss today; namely, the role of women and their representation on the boards of major companies.

The previous Government ignored the issue, despite the strong efforts of Harriet Harman, who deserves much credit. When he was a Minister at the Treasury, the noble Lord, Lord Myners—I am sorry that he is not in his place—dismissed the idea of legislation in this area when I put it to him. I admired him greatly for most of his time as a Minister and said so; but where he fell down badly was in refusing point blank to look seriously at the paucity of women directors. In mitigation, he boasted that, when chairman of Marks and Spencer, he had the highest proportion of women board members of any large company. However, most of them were non-executive directors; and that record does not absolve him from the wrong judgment that he made in office.

The noble Lord is reported as intending to undergo theological training: not the usual form of hedge-betting that former financiers practise, but one that might start a trend. Who knows? The partners of Goldman Sachs may end up doing God's work after all. Theological training will give the noble Lord an opportunity for reflection, after which I hope he will be converted to the full and equal participation of women in the corporate governance of our major companies, and to the proposition that legislative provision should be made to ensure this.

It is a sign of progress, I hope, that in the course of the past few months, there has been some evidence of a growing awareness of the necessity of securing more women as directors. In March, the noble Lord, Lord Davies, then Minister for Trade and Investment, wrote to the chairmen of the FTSE 100 companies urging them to appoint more women directors. On 8 March, in answering a Question posed by the noble Baroness, Lady Howe of Idlicote, he agreed that,

“it is not acceptable that 25 per cent of the FTSE 100 companies do not have women on their boards”.—[Official Report, 8/3/10; col. 6.]

He added that the Financial Reporting Council would be instructed to ask companies the reasons for this lack, and to name and shame them.

It is quite disgraceful that women make up only 5.2 per cent of executive directors of the FTSE 100 companies. Though it was not mentioned specifically in the Queen's Speech, this initiative is being maintained by the new coalition Government. The Financial Reporting Council, under its new chair, the noble Baroness, Lady Hogg, is to review its code to require companies to have regard to diversity in their main board appointments. I wish her well in her new post, because she will have her work cut out.

Before the general election, it was reported in the Financial Times on 3 May that the Conservative equalities manifesto proposed that half the long-lists for directorships would have to be women; that directorships would have to be publicly advertised; and that any company with less than a third of women members would have to state in its annual report what steps it was taking to remedy the situation. These are much bolder commitments than those of the previous Government, and are to be welcomed as far as they go—which is still not far enough if the UK is to catch up with international best practice. Norway has been the outstanding pioneer in tackling this problem. It legislated to require companies to have women as 40 per cent of their directors by this year. In fact, the target was met in 2008. Spain has followed suit. France is going further in insisting that 50 per cent of company boards are composed of females by 2015. This is the kind of progress that is required; the imposition of quotas to be met by specific dates is the only way to remove the glass ceiling. Predictably enough, the Institute of Directors is already bleating about the proposed very modest changes to the FRC code. Ruth Sealy, deputy director of the International Centre for Women Leaders, has said:

“Nobody likes the idea of quotas, as it isn’t meritocratic. Yet meritocracy only works with a level playing field. It isn’t level in the UK”.

Male chauvinism is especially at work in the financial services sector. A recent survey of Oxford undergraduates revealed that women respondents regarded the City, and particularly the banks, as “unethical” and as having,

“poor promotion prospects for women”.

A month later, the Treasury Select Committee validated these opinions as reflecting current reality. The committee also cited evidence that the gender pay gap in the City was some 41 per cent compared with 21 per cent in the economy as a whole.

The question has been asked whether more women in senior positions would have prevented the current crisis. That cannot be easily answered, although there is some evidence that companies with the largest numbers of women directors in the United States are among the most prosperous. But women could hardly have done worse than the men who caused the crisis. However, that is not the point, which is that women should have the same opportunities to participate in senior corporate positions—it is hoped in ensuring success, but also in sharing the blame when failures occur.

I urge my right honourable friend Theresa May, the Home Secretary, who is also the Minister for Women, together with my honourable friend Lynne Featherstone, the Equalities Minister, to press hard for boardroom equality. They should ensure that the coalition Government, with their gross preponderance of men, follow the FRC code. The Queen’s Speech in 2011 should spell out how the Government intend to rectify the position and by when. I trust that the Minister, in winding up, will be able to reassure me on this point.

20:11

[The Duke of Montrose]

My Lords, Parliament now has a coalition, which, with any luck, will guide the policies of the United Kingdom for the next five years. As noble Lords will be aware, one critical event in this period will be the next revision of the common agricultural policy.

I declare my interests as a farmer and a livestock rearer. I should like to say how encouraged I was to hear the right reverend Prelate the Bishop of Wakefield raising some of the issues that affect the industry. In fact, as one of the Government’s purposes is, I believe, to encourage business and manufacturing outside the south-east of the United Kingdom, they could bear in mind that agriculture has a part to play.

Strange as it may seem, the founding principles of the CAP are, in my opinion, still valid. These were: to increase agricultural productivity by promoting technological progress and efficiency; to ensure a fair standard of living for the agricultural community; to stabilise markets; and to ensure availability of supplies. The new factor that we have woken up to is that the CAP must also protect and enhance the environment. This is being achieved by the transfer of financial support within the budget from what is known as Pillar 1 to Pillar 2. Part of the Government’s task will be to see that this is carried out equitably across all our partners in Europe.

Another factor is that, as negotiations under the World Trade Organisation progress, farming will become more and more exposed to international competition. It is vital that every effort is made to maximise progress and efficiency in order to maintain competitiveness wherever possible. Here at home, as we are faced with our own financial crisis and the Government have already identified proposals to cut £162 million from the Defra budget, that will be an immense challenge. Can the Minister give any indication of the key areas in which this is likely to be achieved?

Something which the whole industry would like to see, and on which my noble friend Lady Byford made some of her points, is a reduction in the cost of administering the single farm payment. It seems quite extraordinary that, by adopting a more sophisticated structure, the average cost of administering every payment in England was, as she said, £1,743, whereas I have been told that in Scotland the figure was £240. However, the Scots are certainly now having to address the structural shortfalls in their scheme and they will have to move to an area-based system, but unfortunately they are unable to make the necessary alterations until the review takes place in 2013. Their advantage is that they now have certified maps for all the major holdings and the costs are not likely to approach those experienced in England. What cost target do the Government expect to meet when they carry out the single farm payment this year?

An area of additional expense for both the Administration and for farmers is the newly introduced sheep electronic identification scheme, under which all sheep and goats born after 1 January will have to have two ear tags, one of which is electronic. This shows every sign of being as much of an administrative nightmare as the single farm payment has proved to be.

Your Lordships’ House has already heard of many of the aspects which appear to be unrealistic. They are already posing problems in Scotland where the Administration are looking for a system that could be considered practical. There is the worry that individual farmers with their own reading machines, some of which might be less than top-of-the-range technology, will be liable to create errors. Under the system that they introduced, once all the sheep are tagged, almost all registration of movement will be carried out by drafting the sheep through what are designated “critical control points”. These will almost all be livestock markets and slaughterhouses.

The markets, in particular, can have throughputs of anything from 1,000 to 10,000 sheep a day. Various systems have been under trial and even last week at my local market, with 2,000 sheep present, the operators were proudly trying to maintain that they had only a 10 per cent error rate with the young lambs. However, this means that there could be 200 lambs with buyers which are not showing up correctly on the records.

I ask the Minister to note the proposal currently going through the European Parliament, which contends that the only practical way forward is a three-year introductory period in which the regime is allowed to operate without any question of penalty. This would allow a realistic assessment of what requirements are practical and of the processes and technology capable of delivering what is required. Can we have some assurance that the Government will be prepared to pursue this argument when it comes to the Council of Ministers?

20:17

[Lord Selsdon]

My Lords, over the years that I have been in this House, I have found myself more and more confused by government. Government seem to try, in the interests of everyone, to do too much too often, and confusion reigns. I was brought up to believe that government could do only three things: tax, spend and legislate. I worked in the clearing bank sector, where, again, you did only three things: you took deposits, you made loans and you collected money.

The lifeblood of our country was effectively trade, and I apologise for having been brought up in the world of trade and having to say that I sat below the salt. However, when I look at the Annunciator, which lists the items covered by this debate, it seems that the word “trade” has almost disappeared from the agenda. I ask the Minister, when he comes to reply, whether he can recall who is responsible for trade these days.

I believe that if we look at the strength or weakness of our economy, the answer lies in trading ourselves out of the difficulty. These problems have happened historically, and perhaps I may quote a problem that occurred not so long ago when the monarch at the time set up a committee—not a quango or an ango—

“to take into their consideration, the true causes of the decay of trade and scarcity of coyne … and to consult the means for the removing of these inconveniencies”.

That was in 1621 after the Armada. Your Lordships will be aware that the Armada tapestries will soon be arriving for exhibition here and it will be very moving to see them. However, the theme will be the defence of the realm and the importance of trade.

If we are to trade, we must look at the situation today. Since the war, we have moved from an equal balance of payments—balancing in visibles or goods—to a deficit of £100 billion. We have moved from a currency that was relatively strong and stable to one which is almost the weakest in the world. To put it in simple terms, the kilometre now has the same value as the mile. When we have a balance of payments deficit on visibles, the depreciation of our currency means that we are a major importing nation, as we always have been. The cost of our imports has risen in direct proportion to the weakness of our currency and there seems no possibility of that currency strengthening. There were moments when there was a natural boom, such as when the retail trade purchased goods before Christmas when the currency was high and sold when the currency was lower. Vast expenditure took place when low-cost airlines brought foreigners here to do their Christmas shopping, instead of taking the British abroad on holiday.

Unless we have a stable currency and think of our future as a trading nation, we shall be lost. However, the United Kingdom is one of the few countries in the world which automatically has a worldwide role. That is not necessarily due to the Commonwealth but due to our history of being able to invest and to set up in whatever sector. We are good managers and we have the advantage of the English language. Take the shortage of food: it would be easy for the British agricultural sector, with the right support, to go into any country in Africa and to treble or to quadruple agricultural production. The Sudan was to be the bread basket of the Middle East and the Gezira scheme ran without problems for years. We need to consider those areas.

I have just written a Green Paper called Shipping it Green. I have raised this in your Lordships’ House before but, if we get together with the Commonwealth, we can control the largest sector of the world in many areas and in relation to the sea. Can the Minister tell me today who is President of the Board of Trade? What is the Board of Trade and what are the Minister's responsibilities? In the mean time, I see the noble Lord, Lord Myners, in his place. He might be able to answer my worrying question about the siphoning off of money into non-departmental public bodies, which are known as quangos. In my view, it has risen to somewhere around £50 billion to £60 billion a year. Can the Minister tell me the current budget for those bodies and by how much the Government propose to cut them?

20:21

[Lord Lea of Crondall]

My Lords, I should like to address my remarks to social cohesion in the developing government scenario. I was pleased to hear the analysis of the noble Lord, Lord Skidelsky. I put on record how indebted we are to him for the wonderful book he has written about John Maynard Keynes. Keynes is alive and well, thank you very much. There are lessons to be learnt from the 1930s, as the noble Lord has pointed out in that book, even though the world has changed substantially since then. I echo some of the remarks of my noble friend Lord Myners. I look forward to him being a thorn in the flesh of anyone in the Chamber from his new roving position on the Back Benches.

First, I ask the noble Lord, Lord Henley, whether he agrees that the disaster in the financial services industry has caused the explosive growth in the deficit. Unless we get that right, we shall not get anything right. Eighteen months ago, we were at an annualised rate of 2.5 per cent and now we are at 11.1 per cent. What has happened? There has not been a sudden pay increase for public sector workers. I hope we will not have a dialogue of the deaf. Mr Cameron said that he wanted consensus that we would all tick the same boxes: a fairer society, economic growth, an entrepreneurial spirit and so on. How can we have a mature dialogue unless we have answers to some germane questions? In the middle of all this, we have three or four totally separate black holes in the various analyses being put forward. I do not see why that is so.

The noble Lord, Lord Skidelsky, stopped short of making a point that I should like to make—I believe he would have made the point if he had wished to use this metaphor—that the doctrine of cuts relates to economic growth through the magical resurgence of animal spirits. We are not in the African jungle playing the tom-toms, so what are the animal spirits? Are they the same spirits which led to the disaster? Obviously, if you believe that, you will believe anything. I think that the gloves-on approach in this House in relation to the financial services industry, with some very notable exceptions—I do not want to embarrass my noble friend Lord Myners—suggests that we believe that the financial services industry is still untouchable because it is that part of the world economy which lays the golden eggs. Perhaps the noble Lord, Lord Henley, would kindly answer this question: is the financial services industry now laying golden eggs or is it laying landmines and hand grenades?

It is always the poor that get the blame. I am afraid we are heading in that direction now. The other day, even the Financial Times—my Bible in many circumstances, although not under the editor who is now director-general of the CBI—described many of the obscene salaries in the private sector, notably in the financial services sector, as salaries from another planet. But today's editor of the Financial Times ran a leading article last week on Britain preparing for battle with the unions. What about all the workers? Are they not part of Britain? What about the analysis before the battle? In 1961, Harold Macmillan, in a difficult economic time, had a private talk with George Woodcock, general secretary of the TUC, which led to the setting up of the National Economic Development Council.

At the moment, I do not think that social cohesion is viewed as important. On the contrary: people are moving away from each other at a terrifying rate. I say this in all seriousness to the Liberal Democrat part of the Government because this is a role which they can play and I wish them well in it. We should be looking at an analysis of industrial and economic players and not just at some sort of doctrinal presentation from politicians, worshipping at the altar of the bond markets. As Angela Merkel, hardly a radical socialist, said the other day, we really ought to work together, including in Europe, to ensure that that comes about.

The public sector is not always paid more than the private sector. If you want a top accountant or an economics expert from KPMG to come into Whitehall, you will have to pay them about 50 or 80 per cent extra, in brown envelopes. If we are not careful, we shall destroy morale in public services—in education and in health—which form part of the living standards of the people of this country, as was pointed out by my noble friend Lord Myners, the other day.

20:29

[Lord Greaves]

My Lords, I, too, wish the new Ministers the best of luck, which they will need, and success in their jobs. Indeed, I wish that for the whole coalition Government. Like everyone on all sides, during the past three weeks I have watched events—I have been on the periphery of them—and have been greatly astonished at what has happened. We now have a completely different political situation and we all must adapt to it.

As regards the environment, rural affairs and agriculture, I am disappointed that there is no Liberal Democrat ministerial involvement in Defra. That will make life a little more difficult for those of us interested in this area, but I am sure that we will find ways of getting round that and co-operating with Ministers who have been appointed in both Houses.

The Coalition: Our Programme for Government, which is an expanded version of the original agreement, contains a great deal of good sense. It contains some other stuff as well, but that is inevitable in a document of this nature. Many things that will be important in the next five years are not contained in the document. Inevitably, many areas could not be covered, because otherwise the document would have been like a telephone directory. Of course, there are also all those things that Harold Macmillan described as, “Events, dear boy, events”, which will turn into extremely important parts of the political scene and in two or three years’ time may dominate, but which we cannot forecast and therefore cannot improve. The idea that this is a blueprint in every detail for the next five years is evident nonsense; the politicians, including those at high levels in both parties of the coalition, who are going around saying that it is need to be a bit more realistic.

I want to concentrate on one or two omissions as regards farming. The noble Baroness, Lady Byford, and the noble Duke, the Duke of Montrose, touched on two that I want to mention particularly—the CAP and the Rural Payments Agency. On the common agricultural policy, the programme states:

“We also believe that much more needs to be done to support the farming industry, protect biodiversity and encourage sustainable food production”.

We could all write lengthy essays on the meaning of those words, but the important point is that much more needs to be done to support the farming industry. That is an important declaration of intent whose details will emerge.

I notice that the responsibilities of the Minister in Defra, the noble Lord, Lord Henley, will include sustainable development. I wish him the best of luck with that and I look forward to hearing him tell the House what it actually means. Whenever we have legislation that includes the expression “sustainable development”, we find it extremely difficult to get the Minister to tell us what it means. I therefore look forward to having those debates with him.

Basically, reform of the CAP is about two things: the size of farm support and what the balance of that support is spent on. The noble Duke referred to the famous Pillars 1 and 2, direct support to farmers and the rural development programme, including environmental work. There is a general consensus that there needs to be a movement from Pillar 1 to Pillar 2. However, it is interesting to note that the agreement hints at change in the balance of support from larger, more economically efficient farms in the lowlands towards hill farming and farming in the uplands. It is clear that farming in the uplands, vital as it is to the landscape, the local economy and the whole system of livestock farming, could not survive if left to itself within a free market. That would have disastrous effects. The Government are therefore to look at ways of providing extra support to hill farmers, in addition to the uplands entry-level environmental scheme, which will replace the current hill farm allowance. I say in parenthesis that it is vital that that transfer is a success.

As regards the Rural Payments Agency, as mentioned by the noble Baroness, Lady Byford, there is no mention in the coalition’s programme for government. The Rural Payments Agency administering the single payment scheme has a history of bureaucratic shambles. The latest is the delay in providing the new maps for many farms, which is causing great delay, distress and difficulty to many farmers. Several thousand were outstanding a few weeks ago and many more maps and missing data are disputed. It is true that the figures quoted for the cost per payment is much greater in England than in Scotland. I do not think that people would mind too much about that if the system were administered efficiently, but the combination of high bureaucratic costs and bureaucratic inefficiency is totally unacceptable. A large number of farmers in England will judge this Government by their success in sorting out the Rural Payments Agency. I say to the Minister that I believe that the Government have about six months to get this sorted out if they really want to keep the confidence of farmers in England.

20:36

[Lord Ryder of Wensum]

My Lords, I congratulate my noble friends on the Front Bench and pay full tribute to the skills of the noble Lord, Lord Myners, as a Minister over the past 18 months.

I expressed my disagreement in your Lordships’ House with the policy of the then Opposition of sharing the proceeds of growth when it was clear that, long before the collapse in the markets, Mr Brown’s public spending, underpinned by the so-called golden rule, was out of control. I urged the then Opposition to alter their line, alas without success. Later, in a debate last November, I sought to persuade your Lordships that a ramification of quantitative easing, and our exit from it, could be a resurgence of inflation. Today, CPI stands at 3.7 per cent and RPI at 5.3 per cent, nearly double the EU rate and the highest for 20 years. The UK has tripled its monetary base in a single year.

Alan Greenspan, the former Federal Reserve chairman, writing in the Financial Times a year ago, highlighted inflation as the real threat to Britain’s sustained recovery. He warned that the pending avalanche of government debt on to the global markets made inflation a special concern. Nearer home, at the same time, Spencer Dale, the Bank of England’s chief economist, warned about the dangers of injecting further liquidity for fear of igniting inflation. Let us hope that his boss, the governor, is no longer influenced by a Cambridge mentor of the 1960s and 1970s—the neo-Keynesian Lord Kahn—who preached that,

“the right aim of monetary policy is not to secure a stable price level”.

Kahn’s disciples still hover in the anterooms of influence and their drug of preference has always been excessive demand. An undimmed principle stands out to those of us active in the inflation battles of 30 and 40 years ago. Inflation cannot maintain high levels of employment in any but the shortest term. In the longer run, to keep up employment, larger doses of the drug are needed, accelerating inflation still further. The outcome is high unemployment, misery and potential social unrest.

No wonder that gold is strong as investors flee government-supplied currencies. Of sterling, the euro and the dollar, none, at the moment, inspires faith. The dollar may be the least weak, but a strong suspicion lurks in some quarters that even the US Administration will permit inflation to tackle part of their ballooning deficit.

Of course, an independent sterling provides us with more levers than the euro would, including the freedom to depreciate our currency, but it also enhances the risk of inflation being used to erode the value of public debt. Veterans from the 1970s battle against inflation and the then neo-Keynesian orthodoxy recognise the phrases “competitive sterling” and “stable inflation expectations” as no more than euphemisms for creeping inflation. We must not be seduced by the bogus charms of currency debasement designed to diminish sovereign debt. Nor must a feeble pound be used as a substitute for robust fiscal decisions and, if necessary, tighter monetary policy.

The OECD, in its economic outlook published last month, stated that the UK, almost alone, risked credibility on inflation. Of course, the OECD realised that inflation has exceeded the 2 per cent Bank of England target in no fewer than 24 of the past 30 months. The OECD predicted that interest rates could reach 3.5 per cent within 18 months due to the Bank’s failure to staunch inflation. That could result in a triple blow of higher taxes, higher spending cuts and rising interest rates. That is why we cannot be relaxed, let alone cavalier, about inflation.

It is certain that the Chancellor will implement changes on 22 June with inflationary implications. Manufacturers have reported rises in the cost of not just oil-related products but other materials, such as rubber and timber. Factory-gate inflation has just risen for the sixth month running.

The British are prone to inflation as a genetic disease. In effect, it is taxation without parliamentary approval. We must recover with sound money or we shall not recover at all. Unless the upward trend is checked, the Bank must act without delay.

20:42

[Lord Jones]

I thank the Minister for her exposition of coalition policy and wish her well in her department. It is good to follow the noble Lord, Lord Ryder. I recollect that he was the Government Chief Whip in another place—a veritable street fighter in the Maastricht debates. His considerations on whipping a coalition would be interesting were we to hear them.

Universities provided the backbone of the prosperity on which Britain was built. Today, they are laying the foundations of economic recovery not only in the United Kingdom but across Europe and the rest of the world. As a whole, the sector generates £59 billion per year for our country and its economy, making it bigger than either the pharmaceutical or the advertising sectors. More than 1,000 spin-out companies have been established across the United Kingdom from universities, employing more than 14,000 people. In addition, the universities bring in more than £5.8 billion in foreign currency from tuition fees and other activities. Surely British universities will be a major engine in the recovery machinery for Britain’s hoped-for economic resurgence.

There is a major threat hanging over our universities today. The sector faces huge financial problems. It is true that the universities have had a major increase in income during the past decade but, as the competition from overseas universities increases, so the shortcomings of our institutions become more apparent. Not only do equipment and buildings begin to show their age, but the best talent is often poached by institutions able to offer the latest equipment and facilities.

Too often, the university sector is dominated by a small number of institutions. That is particularly the case with research funding. I know that the apparent imbalance in research funding provided to institutions in Wales is the subject of an investigation by a supportive and successful Assembly Government.

Another area of concern is the sector’s inability fully to address the need for widening participation. Despite a decade or more of a programme to widen participation in the social backgrounds of the student population, today the scope remains remarkably similar to what it was in the mid-1990s. Some universities have embraced the widening participation agenda; others have paid lip service. Glyndwr University, of which I am honoured to hold the title of chancellor, has been leading the way in developing the economic agenda for Wales. The A55 expressway knowledge industries corridor project includes a number of exciting developments across north Wales, bringing the university even closer to private sector employers. It is the champion of widening participation, with one of the highest proportions of students from socially disadvantaged backgrounds of any university in the country. It has an excellent employability record for its graduates, and our students are doing exceptionally well.

The scale of achievements at that university is considerable. New industrial collaboration is being developed with some of the major employers—for example, with Airbus UK, with its 14,000-strong skilled workforce in north Wales. It is working in collaboration with University College London and local companies on a project to build the largest telescope in the world—a project that, if successful, could bring more than £200 million into the north Wales economy. That is an astounding university project and I wish it well. In all of this, the academic staff are supreme.

20:47

[Lord Griffiths of Fforestfach]

My Lords, it is a great pleasure to follow a fellow Welshman with such an intimate knowledge of the university sector, which I was in for the first 20 years of my career. I agree with almost everything he said. Before speaking on some issues relating to the economy and business, I, like most others today, congratulate my noble friend Lady Wilcox on her appointment as a Minister in the Department for Business, Innovation and Skills. She is exceptionally qualified for the job, having run her own family business, managed a significant multinational, been on the boards of various companies and chaired the National Consumer Council. On behalf of us all, I wish her well. I congratulate my noble friend Lord Henley, a former Minister, on his current appointment and on his courage in responding to such a wide variety of subjects in today’s debate. I do not envy him.

It is very easy to be depressed about the general economic situation. The UK fiscal position is, frankly, not good. One could say it is rather dire. The eurozone is in crisis, and the markets in the eurozone have been in crisis despite the €750 billion package that was meant to sort out everything. Global financial markets are jitterier than at any time since the aftermath of the financial crisis early last year. Despite this, there are some grounds for optimism. The world economy is growing at more than 4 per cent a year, and world trade has come back in the past 12 months by something like 10 per cent, after having dropped sharply in the recession. In the UK, the coalition Government are unambiguously committed to turning around the financial position, and the pace of the recovery in the UK at present, although fragile, is quite strong in comparison with last year and the projection for next year. Last year, GDP fell by 4.9 per cent; this year, independent forecasts put it at 1 to 2 per cent, and next year it is estimated to be between 2 and 3 per cent. We should take confidence from that.

The key to turning around our economy is sustaining the recovery. That means creating a low tax, enterprise economy that has incentives to save and to build up capital and in which government expenditure is under control. Like the noble Lord, Lord Desai, I think that economic growth is critical. It will lead to higher tax revenues and create more jobs. We have been here before. In the early 1980s and the early 1990s, painful decisions involving cuts in public spending were necessary, but we know that they produced long-term gains. After 1992, we had 16 years of uninterrupted economic growth quarter by quarter.

I believe we can return to that, but we face three challenges. The first is that in the emergency Budget later this month, the Government need to put forward some form of medium-term financial plan that lays out, for at least three years, targets for public spending, taxes, the deficit, public sector borrowing and money supply. They then need to stick to it. Drawing up such a plan is not difficult, and when the numbers are announced later this month they must show a significant reduction in the borrowing requirement as a percentage of GDP. There is no reason why this should lead to a double-dip recession. A medium-term programme that investors believe is credible will restore confidence in the foreign exchange and capital markets and encourage investment. The lower exchange rate—the pound has gone down by 25 per cent over two to three years—will help exports. If we fail in this, and if the Government fail in this, we could well find ourselves in the same position as certain eurozone countries.

Publishing a plan is not difficult, but sticking to it will be. At some stage, the Government’s resolve to balance the books will be tested. There could well be painful strikes, protests and marches, and even the possibility of social unrest, which was mentioned, cannot be ruled out. If we are to return to prosperity and stability, it must be faced. We must avoid the mistakes that Ted Heath made in the early 1970s.

The second challenge that we face relates to the banks. If the recovery is to gain momentum, the banks have to lend more off their own balance sheets and to raise more capital from the equity debt and credit markets for business. Without this, investment will falter and the recovery will be put at risk. At present, there is a lot of talk about new taxes on banks and new regulations on banks. We certainly need a different regulatory framework. I can see why the public are angry at the incompetence, greed and excessive risk taken by banks. Their anger—I say this as a banker—is not without substance. The problem, however, is that if politicians and regulators pursue populist policies that could be quite arbitrary, we might find that the banks, instead of helping the recession and helping growth, are a mortmain on it.

The third challenge is this; it is very important that economic policy is underpinned by a sense of fairness and justice.

[Lord Lea of Crondall]

I am grateful to the noble Lord for giving way in his last minute. When he referred to the banks, I expected to hear an agenda of banking reform, but his statement seemed to be, “Watch it. Goldman Sachs can do no wrong”. Is that not a bit like the Conservative Party’s caricature 20 years ago of the TUC doing no wrong?

[Lord Griffiths of Fforestfach]

This is a complex subject, and we do not have time tonight to deal with it in detail. Clearly, we need a stronger regulatory structure with very clear rules on capital, liquidity, the structure of compensation and so on; about that I have no doubt. It would be wrong for politicians and regulators to respond to the public anger by piling so much regulation and tax on to the financial sector that it cannot play its role in the recovery.

I am way over my time, but my final point is that the sense of fairness and justice as we face difficult times will be very important. Our enterprise economy should never become a Darwinian jungle. So many things can be done by the coalition Government to present the policies fairly. We are in difficult times. We have been here before, we have taken difficult decisions in the past and pain has resulted in gain, and I have no doubt that we can do it again. I wish the coalition Government every possible success.

20:56

[The Earl of Glasgow]

My Lords, it is encouraging to learn from the gracious Speech that the Government are still committed to a high-speed rail network, although we all appreciate that the service is unlikely to be in operation before 2025. What is not clear, however, is the planned reach of this north-to-south high-speed line. It is sometimes reported that the Government plan to go no further than Manchester or Leeds, and sometimes in the first stage no further than Birmingham, but surely the real value of a high-speed rail service is to reduce the travelling time on long-distance journeys—by that, I mean distances of more than 200 miles.

From the outset, the line must be planned to go all the way to Scotland. The 20 minutes or so that will be saved on the 120-mile journey from London to Birmingham hardly justifies the huge capital expenditure. On the other hand, the two hours or more that will be cut from the journey time from London to Glasgow will make a huge difference. Perhaps more importantly for the future, it will greatly reduce the need for the large number of polluting internal flights that now go between England and Scotland, and may eventually make them redundant altogether.

We are told that the tipping point—a new buzzword for me—is approximately three hours. That means that on a journey that takes no more than three hours, the traveller is most likely to take the train. If a journey takes more than three hours by train, the traveller will choose to fly. That certainly matches my experience. If I could get to London from my home in Scotland in three hours, I would certainly take the train. Five hours is just too long, so I come here via Heathrow or London City Airport, thus contributing to our carbon emissions.

Surely the main purpose of high-speed rail in Britain is to cover the longer distances at a considerably increased speed. Improvements to the existing network should be able to satisfy the needs of the shorter-distance traveller. I therefore seek the Minister’s assurance that the Government are now planning a high-speed rail route all the way to Scotland and that this decision will not be left until after the Midlands or north of England route has been established. I would be grateful to know the Government’s policy on this.

Another reason for wanting assurance on this concerns the whole of the Scottish economy. A high-speed rail service to London and the continent that starts no further north than Manchester or Leeds will put Scotland at a considerable economic disadvantage in relation to the rest of the United Kingdom. The population of England will continue to grow, while the population of Scotland, so much further away from most of Britain’s financial and industrial centres, will continue to decline. It is quite reasonable to expect the Scottish Government to shoulder the financial burden of a line from Glasgow and Edinburgh to the border, but I would expect the Government to finance the line as far as Carlisle.

Clearly, no engineering work on any new high-speed rail network will start for a good few years. I hope that we do not have to wait until Crossrail has been fully completed before it can get started. But when the building starts, in a time when we all hope that the country will be in a much healthier financial position, the objective must be to build the complete line from the Scottish border to the Channel Tunnel, not just a part of it as a first stage.

Finally, I hope that the Government recognise something that many of us on all sides of the House have stressed for some time; namely, that Britain’s future transport policy must be based on the train—not just the high-speed rail link to Scotland but a greatly improved and expanded existing service. We cannot go on building more motorways, bypasses and dual carriageways. We cannot go on building more airports and runways, and those ghastly terminal buildings. We are meant to be a country which is concerned about the environment and committed to reducing carbon emissions. Apart from the train being the most environmentally friendly mode of transport for passengers and freight, it is potentially—I emphasise “potentially”, because it is not necessarily the case at the moment—the most civilised and stress-free form of travel.

The more roads we build, the more cars and trucks will materialise to fill them. If this Government could have the courage to resist the cries of anguish from the very vocal car lobby, they should seriously consider a four-year or five-year moratorium on road building. Clearly, essential road improvements and projects already started must be completed and road maintenance must continue. But the money saved on major roadworks could go to improving the efficiency, comfort, convenience and capacity of our railways.

The main objective should be to persuade some of those people who cannot move without their car to occasionally consider the train as an alternative and, within, say, 10 years or so to reduce road traffic by 10 per cent. If that were to be the case, it might not even be desirable to build any more roads. Of course, to achieve that aim, rail fares would have to be cheaper, which is an issue for a much longer debate. In the mean time, I should like to think that the Government are thinking something along those lines and I look forward to hearing more details about the coalition’s plans for transport.

21:02

[Lord Bates]

My Lords, it is a privilege to follow my noble friend. I was reminded that the paragraph in the gracious Speech that refers to high-speed rail links also mentions the increase in broadband speeds. As well as having that physical network and infrastructure to embrace and encourage enterprise in the economy through high-speed rail—which I fully endorse as someone who lives in a peripheral region in the north-east of England—increasingly, the second part, the commitment to and the going forward of the major broadband infrastructure, will be extremely welcome.

It is a privilege to take part in this debate on the gracious Speech. I, too, along with my noble friend Lord Griffiths, offer my congratulations to colleagues on the Front Bench—the noble Lord, Lord Henley, and the noble Baroness, Lady Wilcox. The noble Baroness gave an outstanding opening address. She displayed her instinct for business and enterprise, and an ability to cut through bureaucratic waffle with a knife—a fish knife at that. I want to use my time to focus on the needs of business, particularly as they pertain to the north-east of England. I should declare my interests, as listed in the register of interests, in two small- to medium-sized enterprises in that region.

The gracious Speech states that the “first priority” of this Government,

“is to reduce the deficit and restore economic growth”.

That is about as clear as we can get it. The task is to get the ruptured pipe of debt under control before it wreaks irreparable damage on the fabric of the British economy. Time is not on our side, but as Abraham Lincoln said, you cannot escape responsibility for tomorrow by evading it today. That is the lesson of history that the previous Government ignored and which it falls to this Government to tackle.

But it is not just about cutting costs, it is about increasing revenue and sales. Our sales force is the 2 million-plus businesses out there who are fighting for their very survival. We need to free them up to do what they do best: to create wealth and create jobs. Cutting corporate taxes will enable businesses to invest more of their own profits and in turn increase tax revenues to the Exchequer. Even more important, in my view, is the strong message of deregulation through the gracious Speech because that helps both sides of the balance sheet, the public and the private sectors. By reducing the burden of regulation, not only do we free up business to create more wealth, therefore yielding more tax revenue, but at the same time we reduce the requirement for armies of bureaucrats to police and interpret the rules, and allow more resources from the public sector to be directed towards protecting front-line services.

Finally, I want to say something about the north-east of England and local enterprise partnerships, which are referred to in the gracious Speech. Over the past couple of years there has been a healthy and vigorous debate in the north-east region about the future of our regional development agency, One North East. In the spirit of the coalition, consensus is beginning to emerge about the way forward, and I for one welcome that. On the one hand there was a debate about whether we should have multiple local enterprise partnerships, based on Teesside, the rural economy and Tyne and Wear. Consensus is emerging around the fact that we are the smallest of the English regions in terms of population and geography and therefore we need one voice for the north-east region. On the other hand, there is a recognition that the current organisation of the regional development agency is too large and unwieldy. In trying to manage everything, it is failing in many ways to do something significant. At the moment it manages everything from housing quotas, transport, highways, planning, cultural and even forestry strategies, thus falling foul of the contribution of the noble Lord, Lord Myners—whose contributions from the Front Bench I have always enjoyed and no doubt will continue to enjoy when he speaks from the Back Benches—when he said that jobs cannot be created by interminable meetings in committee rooms. He is absolutely right. Jobs are created by businesses that make and sell things, and they deserve a Government who are on their side, not on their back. The role of an enterprise partnership should be focused solely on the need to promote enterprise within a region and to sell the region internationally.

On Saturday, I had the privilege of attending the rollout of a huge, 2,500-tonne pipe-laying rig, the first of its type in the world, which was launched on Teesside by the engineering business founded by Dr Tony Trapp, a former academic at Newcastle University’s engineering department. He has built a company without any government help which has a turnover of £150 million and employs 500 people, and which spins out lots of other businesses around the north-east. The north-east of England is now a centre of excellence for seabed and offshore engineering, and that is particularly significant given the commitment to new sources of renewable energy such as offshore wind farms. That is happening not only in this country, but around the world.

As well as legislation and money, we need to recognise that there is a place for inspiration and leadership. The north-east is the only region in the country which exports more than it imports, and we have many strengths, but in the past we have put far too much faith in government to solve our problems, and far too little faith in ourselves. Tony Trapp told me that his motto for success in business was ABC: ambition to achieve; belief in our talent and ability to succeed: and the courage to face up to the inevitable challenges along the way. That has worked spectacularly well for him and I believe it works for the north-east too. I also believe that it is a good mantra for the coalition Government.

21:08

[Baroness McIntosh of Hudnall]

My Lords, I begin by joining in the congratulations that have been offered to the two new Ministers. I should like also to extend my own commiserations to the noble Lord, Lord Henley, in the task he faces in summing up this extraordinarily wide-ranging debate. I should also like to congratulate my noble friend Lord Myners, who gave us an absolutely barnstorming speech. His intention to retreat to the Back Benches has provoked what it would be fair to say are lamentations around the House, so I invite him to consider his contribution today as perhaps the first of many final appearances at the Dispatch Box.

I want to talk about a particular aspect of business but, before I do, I should like to say something about transport. As a supporter of the stop Stansted expansion campaign for some years, I welcome the withdrawal of BAA’s planning applications for additional runways at Heathrow and Stansted airports and the part that the new Government’s declaration of intent has played in provoking that long overdue decision. How much it was attributable to government action and how much to BAA losing the will to live in the face of very well organised and effectively marshalled economic and environmental arguments I could not say but, either way, I hope the Government will remain steadfast on the critical issue of airport expansion. When they come to review aviation policy, I hope they will not revive the crippling uncertainties that have blighted communities in Sipson and north Essex for nearly a decade. When the Minister comes to reply I hope he can reassure me on this point.

I turn now to business, albeit of a kind that does not often get mentioned in the same breath as the City and high finance, so I am taking this opportunity to discuss the creative industries where they belong—in company with other significant contributors to this country’s economic effort. Too often they are assumed to inhabit a different bit of the political universe. The term “creative industries” covers everything from the mega-commercial, mega-successful worlds of computer gaming, blockbuster publishing and multi-million dollar film franchises such as Harry Potter and James Bond, right down to tiny one or two-person enterprises making, for example, hand-crafted jewellery, designing fashion or creating i-phone applications. The result of this diversity is a mass of output and a body of talented people whose skills are in demand all over the world. The UK creative industries are a success, accounting for, according to DCMS figures published earlier this year, 6.2 per cent of gross value added in 2007; exporting £16.6 billion worth of services in the same year, which was 4.5 per cent of all goods and services exported; and in 2008 there were coming up to 2 million jobs in the sector, of which 1.1 million were in the creative industries themselves and a further 800,000 plus creative jobs were within other businesses.

By any standards these are significant figures generated by businesses which deserve our respect and support and not the lofty disdain manifested, for example, in a curiously sour piece in a recent edition of Prospect, which makes the fundamental error of assuming that, because we talk about the economic benefits of a strong creative and cultural sector, we elevate the importance of those benefits over the quality of what is created. That is simply wrong.

In a thoughtful speech last month, the new Secretary of State for Culture, Olympics, Media and Sport, Jeremy Hunt, said:

“For me, culture is not just about the value of our creative industries—not just about more than 3 million visits to UK cinemas each week, more than 40 million visits to our national museums and galleries each year, or more than 14 million visits to the theatre in London alone—it is what defines us as a civilised nation.

I agree with that sentiment from the bottom of my heart, but I also recognise the economic impact creative industries have had and can continue to have as long as they are not cut off at the knees by the insensitive application of harsh economic correctives or the loss of support for fledgling enterprise.

The noble Baroness, Lady Wilcox, emphasised the new Government’s belief that economic recovery in this country must be led by the private sector, particularly SMEs. Contrary to popular belief, most creative businesses are in the private sector and many are SMEs—for instance, in independent television production, the fashion industry or, indeed, computer gaming—but their market is globalised and highly competitive and they need to be encouraged in two significant ways, both of which require government to play a part. The first is that many of them depend on high skills levels, including in design, mathematics and computing. I refer your Lordships to the findings on this subject in a report published earlier this year by the House of Lords Select Committee on Communications looking into the film and television industries. Higher education has an important part to play in delivering these skills—and here I acknowledge the remarks of my noble friend Lord Jones—and severe cuts to that sector will have a negative impact on our creative industries. Secondly, the commercial viability of, for example, London theatre, which has an astonishing track record of success both here and overseas, depends significantly on talent and material nurtured in publicly funded organisations such as the National Theatre, the Chichester Festival Theatre and the Royal Court. The recent 4 per cent cut administered to the Arts Council, which was more than to other DCMS bodies, makes me wonder whether the Government have yet fully understood the symbiotic nature of public and private enterprise in the cultural sector.

However, I recognise that, at a time when the national watchword appears to be austerity, there can be no expectation of special treatment and I do not ask for it. What I do ask is that our creative industries, for which the UK is very widely admired, should not be treated less well than other sectors and that their particular needs and unique contribution should be properly respected.

21:15

[Lord Birt]

My Lords, I share the universal delight in the ascent of the noble Baroness, Lady Wilcox, who during the day seems to have risen almost to the status of sainthood. I only hope that her trademark cheery beam will be maintained in the white-water ride ahead.

I offer a new Government my best wishes and my great hope, given the enormous challenges that they face, that in the national interest they will succeed. There is much of the new Government’s inheritance of which we may all be proud: our social, creative and academic vitality as a nation; our tolerance; our ease with diversity; our renewed spirit of enterprise; and the improving performance of our public sector. However, 2010 will surely come to be seen as a year, alongside 1945 and 1979, when a new Government faced the aftermath of a cataclysm: in this instance, the most severe economic shock of our lifetimes.

The urgent task, as I think we almost all recognise, is the elimination over time of the deficit, our pressing need to return to a position where, across the economic cycle, we spend as a nation only what we earn and not what we can borrow. The politics of reducing that deficit will be severe and testing for the coalition. But it can be done; and it must be done. I have no doubt from my own experience of managing both in the public and the private sectors that the deficit can be eliminated with minimal material damage to critical public sector outcomes. Indeed, many private sector organisations, their very survival in question, have faced up to far bigger challenges and in shorter order. However, I do not minimise the particular challenges that the public sector will always present, not least the intensity of scrutiny and the readiness to protest of all the interests affected.

[Lord Lea of Crondall]

The noble Lord makes play of a very interesting point about the recession-related deficit—in other words, adjusted for the recession. Does he happen to know the current size of the recession-related deficit?

[Lord Birt]

Perhaps the noble Lord will allow me to move to the end of my remarks and hear my argument in full.

There will be, for there always are, some low hanging fruit for the Treasury to pocket. Government can, and no doubt will, cease doing some things that they do now, but the scalpel will prove a more useful tool than the axe. After a long and unprecedented period of increased public spending, conducting a detailed, painstaking analysis of how every part of the public sector can be more productive will be fruitful.

There will be overcapacity, poorly engineered processes and low utilisation, as well as opportunities for shared services, outsourcing and multiskilling. There will be places where labour costs at every level will be higher than in the market, where smarter procurement can bring benefits and where best practice is not universal. Moreover, no part of the public sector should be excluded from a concerted drive to promote improved productivity. There should be no sacred cows, as the noble Lord, Lord Lawson, said earlier. The Government will need a keen sense of what can be done quickly and what may take a little time. A four or five-year framework will be sensible, as the noble Lord, Lord Griffiths, observed. The new Government will discover that while Whitehall has been gradually acquiring in recent years many of the skills needed to oversee large institutions, projects and programmes, the financial skills necessary for the forensic examination of a vast cost base are not yet present in government and will need quickly to be assembled. The new Government will need to reach out into the market for some vital and not just financial skills, and it will need to invest in them if the deficit is to be cut with care. Sometimes you have to spend money to save money.

The other main challenge of the new Government is to restore the health and stability of the economy overall, about which many of your Lordships have spoken. An early and credible plan for cutting the deficit, accompanied by real political unity, will do much to put us back on the right road. But the main task here is to be certain that we have truly identified the causes of our difficulties, both at national and global level, and applied the right remedies. Here I have yet to be reassured. We are two years into the crisis, and still we hear an array of competing views on regulation from technical experts, and we have had world leaders—even in recent months—still bashing bankers rather than explaining how international institutions, nations, regulators, financial organisations, corporations and individuals could all have managed risk more prudently, averting reckless excess, and can manage risk more effectively in future. We appear far from unanimity.

There was an understandable general urge to grapple with how and why we embarked on the war in Iraq. It is not too late for a new Government to bring similar independent scrutiny to bear on the causes of, and the cures for, our current maladies, including the origins of our own structural deficit, which puts us closer to the bottom than the top of the league of virtue among comparable countries. Only on the foundation of a deep understanding and a cool appraisal of all our difficulties can a better future be built.

21:22

[Lord Brooke of Sutton Mandeville]

My Lords, I shall come to my noble friend Lady Wilcox in a moment. First, once upon a time, the noble Lord, Lord Birt, and I used to meet across a table to discuss the 1994 White Paper on the BBC, and it is a pleasure to be linked consecutively with him once again.

Most of your Lordships’ House will probably have heard before from others’ lips what I am going to say next, but if only one noble Lord present tonight had never heard it before, he or she would alone make it worth saying again. It relates to the levee given by King George V in the palace in 1931, 80 years ago, when the sovereign asked Mr Jimmy Thomas, a member of his Cabinet, whether the international financial situation was really quite as serious as Mr Snowden, the Chancellor of the Exchequer, kept telling him. Mr Thomas replied, “King, it’s that serious that if I were you I’d put the colonies in the wife’s name”. The message of the last Labour Chief Secretary, Mr Byrne, to his successor in the coalition, suggests that he might have given the same advice. Perhaps it is no coincidence that the Conservative gains in this election were the largest since those they achieved in the election of 1931. That is what the deficit does to you. The highest compliment that I can pay to my noble friend Lady Wilcox is that I have every confidence in her ability and that of my and her noble friends in the Treasury to sort it out without my direct help. Of course, we shall all very genuinely miss the noble Lord, Lord Myners, who was and is in all senses my former constituent.

That has taken the first of my minutes. My remaining four will be devoted to four brief points or comments. First, after the deficit, on which debt interest is now taking more per annum than is spent in the Budget on schools’ revenue expenditure, the challenge to the Government is unemployment, especially among the young—hence the references to growth.

It is a conventional commonplace that it is SMEs that now generate jobs. Once upon a time, almost 50 years ago, I joined a firm of 10 foreigners to open their business in this country. Fifty years later, that worldwide business is now the largest of its kind in the world still in private hands, so we must have done something right. But what I remember from that original period is Messrs Kaldor and Balogh, perhaps in the context of the SET, making me spend a weekend every month providing proof to the Inland Revenue that I needed to keep all our money in the business, which, as the man building the business, I knew perfectly well already. So my first plea to my noble friends on the Front Bench is that they reduce the burden of unnecessary tasks on entrepreneurs when they need their energy to justify and finance the creation of new jobs.

My second plea is similar. I was proud to serve on a Treasury team of four Ministers under my noble friend Lord Lawson, all of whom in due course reached the Cabinet, two of them reaching No. 11, one of them reaching No. 10, and who helped my noble friend to carry through the massive simplification in the tax system that he achieved. I do not place on the Labour Government the whole responsibility for dismantling that simplicity—though they must carry some, especially in dismantling changes that they had themselves created—but it is high time that we got that simplicity back, even if some of Labour’s complications will make it harder. Simplicity in taxation makes it likely that people will take investment decisions, and better ones, for business reasons rather than for tax ones.

My third plea supports the coalition’s desire to rebalance the economy. I agree with the noble Lord, Lord Bhattacharyya, on the abilities still inherent in British engineering, on which the noble Lord, Lord Broers, also spoke. Those firms that have survived have done so because they are world-class, which they owe substantially to their R&D investment in technology. I reiterate to the coalition as a whole the advice of my noble friend Lord Waldegrave of North Hill in yesterday’s Times to the new Chief Secretary, my right honourable friend Mr Alexander. My noble friend was a distinguished Chief Secretary, and the first for over 30 years to have run a large spending department before he became Chief Secretary. A critical part of his advice yesterday was to keep a secret reserve in his hip pocket for subjects, like science, that departmental heads might not champion. I acknowledge that I speak as a former departmental Minister at a time when the Chief Secretary took precisely the opposite view.

Finally, a quiet word: the coalition should not believe everything that it reads in the papers, especially if it causes depression. As the first Viscount Slim said in the war, “No news is ever as good or as bad as it first appears”. A noble Lord earlier in this debate referred to rural broadband. I live in Wiltshire, a county notorious for an atmospheric phenomenon called the Wiltshire banana. I live at the end of a lane two miles from the nearest shop. Two hundred yards from our house lives and works the highly respected automotive engineer who won the £25,000 prize given by the Mayor of London for a contemporary “Routemaster plus” design, but who relies on online engineering to design buses for Brazil and trucks for China. Until a year ago, half way—or 100 yards—between us lived another couple. They ran another successful service business reliant on high-speed broadband but could not afford to buy a first home in Britain so moved to France, partly because they could afford a first home there but also because, on technology, they believed the 18th-century English novelist who said, “They order these things better in France”. It turns out that they do not, and rural France’s broadband is much slower than Wiltshire’s, endangering the whole of that couple’s business and their decision to move. It is a crucial imperative for the coalition that it persuades our compatriots at all levels to believe in themselves. As I sit down, with sympathy, I encourage my noble friend Lord Henley to act on that advice at the end of this notable debate.

21:30

[The Earl of Caithness]

My Lords, I, too, congratulate my noble friends on their appointment as Ministers, particularly my noble friend Lord Henley on going back into the job. I served with him in government some time ago; to see him back on the Front Bench is a delight. He has a difficult job at Defra. I hope that he will pay attention to what the coalition wants and that there should be no gold-plating. Defra has been notorious for gold-plating some of the many regulations.

I know that another aspect will be drawn to my noble friend’s attention. It was highlighted by this House’s sub-committee on agriculture and the environment in discussing animal testing to try to get a level playing field across Europe. So often gold-plating is not necessary in the UK but Europe is not doing the same as us, which leads to added costs. My noble friend has a difficult challenge ahead with CAP reform. That has been talked about, but to try to undertake CAP reform in a period when one has to feed a growing world population will be an even harder job.

I shed absolutely no tears that we see the end of home information packs. I fought them tooth and nail all the way through the House. They were a complete waste of time and money by the Labour Government.

I notice that the coalition will,

“deliver an offshore electricity grid in order to support the development of a new generation of offshore wind power”.

It says nothing about wave and tidal power. Can my noble friend say anything about the proposals for wave and tidal power, particularly those that will affect us in the north of Scotland on the Pentland Firth? The right reverend Prelate the Bishop of Liverpool talked about renewables in the north-west of England, but the north of Scotland is also an area where the grid system is absolutely vital to development.

I watched with interest the relief on the faces of those in the Labour Party as it lost power, knowing full well that it had landed the new Government with what is called, in rugby terms, the hospital pass. Yet again, a Conservative Government must pick up a worse financial situation than they handed on to a Labour Government, and this one is particularly bad.

Our Government want to make the banking system better,

“to serve business, not the other way round”.

The words that are missing from that are “the individual”. I do not think that the banking system serves the individual. However, I was delighted to read that the Government,

“will establish an independent commission to investigate the complex issue of separating retail and investment banking in a sustainable way”.

Many of your Lordships will know that I have been banging this drum since, I think, 1997, when I made a speech on the issue from these Benches when the Conservative Government were still in power. In 2008 I introduced the Safety Deposit Current Accounts Bill, which—if it had been agreed—would have saved the banking sector from some of the financial problems that it came into.

I am a great believer in separating the retail and investment sides of banking, but it is not an easy solution. It is fraught with difficulties and I wonder whether this Government have the determination to do it. Separating retail from investment banking means that in the retail banking system the depositors should retain control over their money. At the moment, as your Lordships will be aware, if you deposit money at the bank, it no longer belongs to you; it belongs to the bank. You become an unsecured creditor. This is the result not of government legislation but of court cases in the 1800s—in 1811 and 1848. If we are going to reform the banking system, let us not tinker with it but look at what the real problem is. The real problem is how the banks work. There has been much criticism today of greedy bankers and the lack of regulation. That is true to an extent but the real problem is that the banking system itself is wrong. That is what needs to be reformed.

The ownership of deposits must return to the person who made the deposit rather than to the bank. That will also affect the money supply and inflation. By and large, it is the banks that create inflation. My noble friend Lord Ryder was absolutely right to drum that into us. It is something that we must avoid. Separating retail from investment banking and getting the banks to hold money for their depositors and not use that money for gambling purposes will reduce the money supply and go a long way towards stopping inflation. That is a courageous and bold step if the Government will take it. I hope that they will, but I fear that they will not.

21:35

[Lord Giddens]

My Lords, I think that I am number 47 in line to congratulate the noble Baroness, Lady Wilcox, on her excellent opening speech, to welcome the other new members of the government Front Bench and to congratulate my noble friend Lord Myners. I think that I am also about number 10 in line to offer comments on climate change and energy security. Since so many other noble Lords have spoken on this issue, I will keep my comments brief.

I generally endorse the policy outlined by the Government as described in the coalition programme document and noted in the noble Baroness’s speech. However, I should like to ask three or four questions or pose three or four problems. First, in the documentation that I have seen so far, the Copenhagen accord is not mentioned. What is the Government’s view of it as a potential way forward in international negotiations? The Government say:

“We will work towards an ambitious global climate deal”.

But how will they do that? What kind of climate deal do the Government have in mind?

Secondly, the Government are right to endorse feed-in tariffs and community-owned renewable energy schemes. However, it is impossible to see how one can have effective climate change and energy policy without a strongly interventionist state. The recent Ofgem report marks pretty much a volte-face in policy on the part of that organisation, recognising that a free-market approach to energy investment has major flaws. If the state has to play a fundamental role in climate change and energy policy, how will the Government reconcile that with their reservations about the state as outlined in other aspects of their policy programme?

Thirdly, the Government say, in my view quite rightly:

“We will introduce a floor price for carbon”.

But how will this be achieved and where will that floor price initially be set?

Fourthly and finally, as is well known, the Liberal Democrat partners to the coalition were originally bluntly opposed to investment in nuclear power. An agreement has been reached about such investment based on the premise that it can go ahead so long as no public investment or support is involved. EDF seems to agree that it can go ahead on that basis and invest in nuclear power stations. However, what will happen if that is not the case and public support is needed for an effective investment in nuclear power stations to go ahead?

21:40

[Lord Plumb]

My Lords, I join the other 47 speakers in offering my congratulations and good wishes to my noble friends Lady Wilcox and Lord Henley. She made a cracking opening in this debate and I do not think that any of us would envy my noble friend Lord Henley winding up this wide-ranging, but extremely important, debate. I also thank the noble Lord, Lord Myners, for his contribution on the economy and financial matters over the past year. It has been interesting to share some of the concerns with him.

Many farmers were encouraged by the statement in the Conservative Party manifesto promising to prioritise research and development, and to develop a long-term strategic agenda across the food chain that reflects the importance of raising production sustainably. It is worth quoting some interesting research carried out at Humboldt University of Berlin. It calculated that 35 million hectares of land outside Europe is needed, equivalent to twice the area of United Kingdom land that produces food, to meet the needs of a population of 9 billion people. It also claimed that the food needs of the world can be met only when the richer countries produce more, not less, as is often argued.

Sadly, as we have already heard, our starting point for growth is lower than it should be. We are importing some £32 billion worth of food, compared with exports of £13 billion. Those are the most recent figures, which will have changed with currency ratios. In addition, 40,000 cattle each year are slaughtered as a result of bovine TB, at a cost of some £100 million.

Regarding the Bills mentioned in the gracious Speech, it is essential that the proposed cuts of £162 million and budget savings do not harm competitiveness. I hope that the Minister will be in a position to tell your Lordships how Defra can reduce spending without hindering a forward-looking farming industry.

While food security should have priority, there will be three Bills of significance to which I shall refer—the energy security and green economy Bill, the decentralisation and localism Bill and the public bodies reform Bill. These are all important Bills. The encouraging signals to deliver greater levels of low-carbon energy generation will increase investor confidence in renewables, whereby farmers and growers can play a major role.

Revision of the feed-in tariff incentive for small and medium-sized anaerobic digestion plants is a key element, and planners must take note and act without delay on the contribution that they make when dealing with waste for the production of energy from waste products, including food, that currently pour into infill sites. Waste is power and could be the focus of energy policy. Energy from wind farms can be variable, but energy from waste is base-load power. Power from biofuels will continue to be commercially important for heavy vehicle transport in the foreseeable future.

On decentralisation and localism, the consequence of a commitment to abolish RDAs is something that a lot of people would say “Hear, hear” to. Creating local enterprise partnerships raises questions on the seven-year programme due to end in 2013. That programme is worth £3.9 billion and is part of the common agricultural policy. It should also be considered within the context of the future of the CAP, which we will debate in the future. The programme aims to support and promote sustainable farming, forestry and food sectors and brings wider benefit for the economy and the environment. I hope that the Minister can comment on these matters, but there is also concern as to whether returning decision powers for rural housing and planning to local councils will work. The question is: will the guidance to local authorities be robust or will localism prevail?

Public bodies and quangos are likely to be a target for financial cuts, which is understandable. However, it is important to target cuts that do not undermine food production. Farming is expected to operate like any other business where workers are protected by minimum wage legislation; so why maintain the Agricultural Wages Board? Cutting it would save some £500,000 per year; and I would include some of Defra’s quangos, such as the communications and policy departments.

Despite these problems, there are encouraging signs of an increased understanding of the connection between food and farming, which has led to a greater desire for fair trade both overseas and at home. Support systems for agriculture now rightly recognise the farmer as not only the essential food producer but also the custodian of our biodiverse countryside.

On Sunday 13 June, many people throughout the country will have the chance to visit farms. On Farm Sunday, farms will be open to visits by people who wish to see what happens on a farm and how food is produced, and also to learn about environmental policies.

In future, when we debate the developments that are needed and the CAP, we should embrace one word: “simplification”.

21:45

[Lord Rana]

My Lords, I, too, add my best wishes and congratulations to the ministerial team. They have a challenging job ahead.

Let us consider some causes of the economic crisis that we are all suffering. Over past decades there was a basic shift in the idea of wealth creation, which we now know was misguided. Individuals, financial institutions and Governments accepted a false idea that simply by adding inflated values to property we were creating real wealth. We came to believe that simply adding numbers—whether to derivatives on the financial markets, to property values or to the creation of service industries—was enough to create national wealth. People working in banks were led by sheer greed and lured by the attraction of earning huge bonuses for uncontrolled and unsafe lending.

We also encouraged uncontrolled consumerism, based on exploiting poor people in the developing world who were paid near starvation wages for producing goods for developed countries. We created an economic system based on inequality, injustice and exploitation. We tried—and failed disastrously—to build a modern economy based on financial services, property values and speculation. We now know that this model is not sustainable; it leads to boom and bust cycles.

I am not opposed to property as a means of creating wealth, but it is not enough to generate national wealth. We must shift our focus back to strengthening manufacturing as the primary generator of wealth and economic well-being. We need a more balanced approach to economic development that embraces manufacturing, service industries, banking, financial services, and IT and knowledge-based industries. The Government should focus on developing initiatives and incentives that will stimulate our manufacturing base.

We live in a global village where manufacturing skills are being transferred to developing nations at an alarmingly fast rate. We need to ponder how we can maintain a long-term wage differential when a worker in a developing country earns less than one-tenth of what is earned by his counterpart with a similar skill living in the UK. We continue to demand that workers in these nations provide us with the products that we need at ever cheaper prices. As a result, the gulf between the rich and the poor, and between nations, grows fast. People who toil to produce agricultural or industrial products, especially in the developing world, are not paid a fair wage.

We talk about global warming but we pay only lip service to addressing the problem, although we know that the real cause of global warming is uncontrolled consumerism, overconsumption and the sheer waste that people living in rich countries have got used to. Twenty per cent of the world’s population in the highest-income countries account for 86 per cent of total private consumption, while the poorest 20 per cent account for a minuscule 1.3 per cent; the richest fifth consume 45 per cent of all meat and fish, while the poorest fifth consume just 5 per cent. The United States, for instance, with about only 5 per cent of the world’s population, consumes 25 per cent of the world’s commercial energy and natural resources. The richest consume 58 per cent of total energy; the poorest fifth consume less than 4 per cent. Two billion people exist on less than $2 a day. Finite resources are being sucked from low-income countries with little benefit to them, further accelerating environmental degradation in those countries and removing the resources that the people there need to live on.

This situation is not sustainable. Society should be encouraged to be thrifty, with people eliminating wastefulness from their lifestyles and using only what is absolutely necessary for sustainable living. We should help to create a system whereby the 2 billion poor who receive less than a subsistence wage for their labour are paid a fair living wage. Multinational corporations that buy goods from suppliers in the developing world should press those suppliers to pay a fair wage to the workers whom they employ. By such actions, we will enable them to afford manufactured goods and have better food, better living conditions and better education for their children. By taking these measures, we will be increasing the global consumer base rather than asking the western consumer to spend more to regenerate the economy.

The economic downturn is a rude awakening for us. It should stir us to reassess our lifestyles in order to develop a society in which we respect nature and evolve a more caring and sharing world. We should partner developing countries to help them to grow out of the present recession. The future economic global planning strategy has to be to work together with the developing countries of Asia, Africa and South America to create a more balanced and sustainable economic order that will benefit all. We need a more balanced strategy—one underpinned by a fairer, more equitable, more measured approach, with equal opportunities for wealth generation and sustainable economic development.

21:53

[Lord James of Blackheath]

My Lords, by this hour of the evening I had confidently been expecting to rip up my speech on the grounds that everything that I had to say would have been said already. However, the only thing to which that applies is the congratulations to my noble friends Lady Wilcox and Lord Henley and, as that has been said so often, I hope that they will take it on the nod.

Unfortunately for your Lordships, my subject is going to be renewable energy, about which a great deal has already been heard, but it will come from a direction that no one has touched on at all so far. I should like an assurance from members of the previous Government that the undertakings given to this House in the last address on renewable energy before the election hold good and that the target of a 20 per cent reduction in carbon by 2020 is on course to be met. I have very serious doubts about it. I remind your Lordships that at that time we were told that between 8 and 9 percentage points of the target had been achieved from existing technology and that there was every expectation of the other 12 percentage points being reached between now and 2020. However, we were then told separately that, in order to achieve that, the Government had acquired control of five former estates from the Crown Estate and, in a report on the Crown Estate handing over the land, we were told by the Prime Minister, no less, that he was making available £75 billion for the completion of the wind farms to be placed on those estates.

Seventy-five billion pounds is a lot of money. It is nearly three times the amount that was originally estimated by the Select Committee, which suggested that wind could achieve the 2020 target had we started three years earlier. I would like to know where the £75 billion is today. I suspect that the previous Government have left this country in the position of one of those awful Twenty20 cricket matches with 70 runs to score off 10 balls, which is impossible. I do not think that we can get there by 2020, even with £75 billion. I hope that someone remembered to ask the outgoing Prime Minister, before he went back to Kirkcaldy, for the key to the safe holding the £75 billion. If we cannot spend it on the wind farms, can we please have it for reducing the national debt, as it would be very welcome indeed? Where is it?

If what I suspect is the case, what will we do about meeting the 2020 target? It matters financially. Apart from the need for a cheap source of sustainable energy, which is much more important at the moment than the issue of global warming—I confidently expect to die of hypothermia long before I am dead of carbon poisoning—is there an alternative fallback plan, which can be picked up by the new Government, for how to meet the 2020 target? If we do not meet it, Europe will crucify us with carbon penalty charges after 2020 and we shall have no defence against that if we do not hit the target. What will we do? There is a squeak of a chance of an alternative strategy. I hope that the new Government will make an urgent audit of the viability of the present 2020 programme and assess any alternative.

The previous Government ran a competition for clean coal among four possible contenders for a major government contract and each of them was ready to go with its final bid. My suggestion to the present Government would be to forget immediately the competition and to put all four of those contenders on to a contract, subject to the understanding that they must go for pre-combustion carbon extraction, not post-combustion, and that the contracts are paid on a commercially viable economic basis, with the eventual winner—the one producing the best result—having control of that project.

Some interesting and helpful data on this have come from Durham University and were provided to the ministerial advisory panel, the ACCAT. Had the Government started in 2009, which they clearly did not, they would have achieved 10 per cent of the entire 2020 target simply on pre-combustion coal cleaning. In the event, we are one year behind that. However, there is good news. Professor Gluyas of Durham University has undertaken an assessment—from my days leading survey work on the North Sea, I am not surprised about this—showing that there are 3 billion barrels of oil waiting to be extracted from the North Sea which are not included in any of the current reserves. Unfortunately, that is carbon-intensive, but if we follow the American example from Great Plains, North Dakota, it would be possible to take that technology, which is now ready to roll in Teesside, and to use the extraction of those 3 billion barrels, which would be a huge contribution, if cleaned, towards meeting the 2020 target. We could extract carbon on a clean-coal basis for three years to come, say, and then use the carbon extracted from that coal to wash through the high-carbon-intensive oil taken from the North Sea with the result that we would then have 3 billion clean barrels of oil, which would effectively close the gap in meeting our 2020 target. The technique has worked for 10 years in North Dakota—it is proven and it is good.

There are other things that we could do. We could easily devote more time and effort to the one renewable energy strategy where we are unarguably the world leader: seabed tidal work. Forget the waves—the waves do not work, but tidal does. We absolutely have to have a vigorous defence of the growing threats that Europe is bringing to our dominance of the Dogger Bank, which has the biggest concentration of tidal flows in the world. If we could find a way of linking it properly to the grid, it would be sufficient to provide the entire carbon-free energy needs of the United Kingdom. If the Government would give proper stimulation to a competition among universities and researchers as to how we could create the link between the grid and the tidal power, we would have a ready-made winner.

It is all doable, but not if we continue to believe that the old strategy left behind by the old Government is workable and will be delivered. It will not. We have to have a new strategy and it has to start now.

22:01

[Baroness Kingsmill]

My Lords, the hour is late and the debate has been long. I am the 52nd speaker, so I am not kidding myself that I shall say anything original. The debate has been an example of the House of Lords at its best. We may have a coalition Government—no one won the election—but it has been interesting to see tonight how much common ground there is between all three parties. That is a constructive approach. It is not to say, however, that we will not be a forceful and effective Opposition when we think it is appropriate.

I do not mind that lots of other speakers have congratulated the noble Baroness, Lady Wilcox. I want to add my congratulations. I have known her for a very long time. We spoke on similar platforms many times before either of us were Members of this place. I am delighted to see her where she deserves to be. I am grateful to her for her opening speech, even though I did not agree with everything she said.

I shall be brief because, as I said, I am the 52nd speaker. I have only four points to raise tonight. First, we have a very uncompetitive banking system, which might be the source of many of our problems. I say what the Americans have said; that if a bank is too big to fail, it is probably too big to exist. We need to sit and think about a review of the competitiveness of our banking system generally. We have the means to do that: we could ask the Competition Commission to do it. It is a good idea for the Government to consider that carefully at an early stage. It is interesting to note the recent significant increase in complaints from the public to the financial ombudsman. It is pretty obvious that the uncompetitive nature of our banking system means that it is not serving its customers appropriately.

The Government should also consider how they can lower the barriers to entry for new entrants to the banking system in order to make it more competitive. There are emerging banks, such as Virgin Money, and it would be sensible to create more competitiveness in the banking system by encouraging such banks to develop and grow. It would also be helpful if we expanded financial education for people generally so that they better understand some of the products and issues that they are getting themselves into when they engage with banks. Personally, I would like the banks to undertake an audit of all their products for customers to ascertain the fairness and reasonableness of their pricing.

My second point relates to small businesses. This is related to my point about banking. Since the beginning of the banking crisis, we have lost more than 30,000 small firms, and the drying up of bank credit is largely to blame. Despite the large sums of public money that have been poured into the banks, there are still many stories of profitable businesses with solid credit records being refused loans or offered them on such punitive terms as to be usurious. Good businesses are going to the wall unnecessarily as their cash reserves dwindle and the banks withhold vital credit. I do not want to appear to be attacking the City or banks. The City is and will remain a global centre of excellence not only in financial services, but in the law, accountancy, management consultancy and insurance. However, the banks must recognise the social and economic contract that they have struck in accepting bailout money. They need to fulfil their part in meeting their responsibilities to society and the wider economy. To paraphrase Luke 12:48, “From those to whom much is given, much is required”. It is important that we remember that.

Thirdly, we must look at issues relating to takeovers. I do not want to turn on protectionism or anything like that, but the furore around the takeover by Kraft of Cadbury’s drew everyone's attention to the fact that we do not give sufficient consideration in this country to takeovers by foreign corporations. It is all too easy for that to happen. We should also give some thought to who is entitled to vote in those circumstances because, as everyone is aware, there was a great piling-in of speculators after Cadbury became a target. We should reflect on and consider exactly how we should approach such takeovers.

Fourthly—I am grateful to the noble Lord, Lord Smith of Clifton, for raising the issue—we should consider the huge and offensive waste of female talent in business. As we look around the Chamber today, very few women are represented here as spokespeople for business. We need to address that. The issue of equal pay was mentioned in the Queen's Speech. I am very pleased that it was, because it is disgraceful that, about 40 years after the introduction of the Equal Pay Act, we still face a huge pay gap. I caution the Government. When they are thinking about public sector pay cuts, they must remember that there are a large number of women working in the public sector. They are the people who will suffer most from cuts in public sector expenditure and public sector pay. I hope that those points will be taken on board by those sitting opposite.

22:08

[Lord Newby]

My Lords, like all other noble Lords, I begin by congratulating the noble Baroness, Lady Wilcox, and the noble Lord, Lord Henley, on their new appointments and wish them every success. I have to say that I am extremely sorry that the noble Lord, Lord Myners, has decided to go to the Back Benches—a new experience for him. It has been a great pleasure taking part in debates with him over the past 18 months. Whether I have agreed or disagreed with him, his tremendous knowledge of the subject and willingness to engage genuinely in the issues will be sorely missed.

The noble Lord, Lord Myners, will recall that we supported the previous Government in their fiscal stimulus over the past 18 months, and he helpfully pointed out to the House that I argued against precipitate cuts in public expenditure now. I still believe that deep cuts in public expenditure this year would be a mistake, but the cuts that were announced last week could hardly be described as deep or severe. In some cases, such as abolishing child trust funds, the useless Connexions service and some of the RDAs—though not the northern ones, to reassure the right reverend Prelate—they were desirable in any event. Switching some expenditure into additional apprenticeships surely makes sense at this stage.

Given the crisis in Greece and elsewhere in Europe caused by excessive government borrowing, it would have been completely incredible for a new Government in the UK to come in without making any proposals about reductions in public expenditure. However, the £6 billion of cuts this year is a small fraction of the cuts that will be necessary over the course of this Parliament and a small fraction of the cuts that the previous Government foreshadowed in the Fiscal Responsibility Act. Nothing that we heard today from the noble Lord, Lord Myners, told us how the Labour Party would approach making those cuts to which they are legally committed. There was not a scintilla of a suggestion about how the first pound might be saved. The key questions for all of us is how the cuts, which we all agree will have to be made, can be made to protect the poor and the vulnerable and how we create the strong economy and fair society to which the noble Lord, Lord Haskel, referred.

This is difficult because the poor and the vulnerable are necessarily the principal consumers of many public expenditure programmes. The challenges and opportunities in this area were eloquently set out by the noble Lord, Lord Bichard, in his notable maiden speech last week. With his knowledge of government, he argued that many vulnerable people, households and communities received services that did not meet their needs, and that it was not simply a question of resources because often the services were more expensive than they needed to be. He suggested three ways of reducing costs, improving the efficiency of government services and, therefore, getting more for less: reducing silo thinking in Whitehall; improving the co-ordination between public local bodies; and better co-ordination of purchasing across the public sector. He argued that we should be shaping services around clients, not providers. Surely these must be the benchmarks against which we judge public expenditure cuts over the lifetime of this Parliament.

There are many measures in the Queen’s Speech that we welcome: the proposal on capital gains tax, the green investment bank and the Equitable Life Bill, which is a shameful legacy of the previous Government who steadfastly refused to deal with people who were suffering as a result of the Equitable Life scandal. We welcome the Hutton review of public sector pay and the proposals on mutuals and co-operatives. The economic challenge facing the country remains the greatest in our lifetime. This election result has given us the chance to play a major part in meeting this challenge. We intend to seize it with both hands.

22:13

[Lord Young of Norwood Green]

My Lords, I, too, rise, after some time, to congratulate the noble Baroness, Lady Wilcox, on her appointment and the noble Lord, Lord Henley, on his reappointment. I also congratulate the noble Baroness on her opening speech. I pay tribute to my noble friend Lord Myners for his valedictory speech from the Front Bench. I, like other noble Lords, lament his passing to the Back Benches.

There is no doubt that the country faces the serious challenge of reducing our deficit, and the country needs to know how the Government will do that. Will it be cut fairly without damaging front-line services or hurting the poorest families and—this vital point has been made again and again in a variety of ways—without putting the recovery or future growth at risk? These are the criteria that we will apply when judging the coalition Government’s plans.

On this basis, the recent announcement fails on four counts. On efficiency savings and cuts, cutting now before the recovery is secured risks having higher not lower borrowing. The removal of growth-supporting measures such as university places and RDA business support this year, when they are needed most, cuts away at the investment that will deliver the rebalanced growth that we will need in the years to come. Scrapping the child trust fund even for the poorest families and families with disabled children is a breach of the Conservative manifesto commitment and will make it harder for families to help their children to get a good financial start in life. The Conservatives have broken their promise that the entire £6 billion will be made up of efficiency savings rather than cuts to services and benefits.

The new Government inherit an economy in which the worst of the recession has ended and the recovery is under way, but that recovery cannot be taken for granted, as many contributors have said. The challenge now is to embed and to secure the recovery, not to put it at risk. Where the Government take steps to do that, we will support them, but taking money out of the economy now while the recovery is still fragile is a risk that we should not be taking. As Vince Cable in another place used to argue, damaging the economy now while the private sector was still weak would lead to higher not lower borrowing, to people out of work and to firms not paying tax, and would cost us all more. Does this coalition believe that unemployment is a price worth paying?

Before the election, the Conservatives explicitly stated that they would protect front-line services, but that promise is not being honoured in the light of recent announcements. In fact, the Government’s savings are not just in bureaucracy and back-office staff; they are real cuts to real services and will affect people. Children, even the poorest and the disabled, whom the Conservatives originally promised to protect from cuts, as I have said, will stop receiving child trust fund payments. Business support through regional development agencies is being cut. The rollout of the future jobs fund, which offers work experience or training to 18 to 24 year-olds who have been unemployed for more than six months, is being cancelled. The number of new university places, which the Labour Government announced for this year, is being cut by 10,000. That, again, goes against the Conservative manifesto promise of an extra 10,000 places.

Energy has been the subject of a lot of debate all through today. We welcome measures that we believe will help to lower emissions, increase energy efficiency and encourage growth in low-carbon energy, and which would have appeared in our own legislative programme. These include help for home energy efficiency that would be paid for by energy savings, additional funding for carbon capture and storage, a smart grid, feed-in tariffs and an expanded offshore grid. However, it is clear that the Government cannot offer a coherent and long-term agenda for creating a secure low-carbon energy mix and reducing our domestic emissions. Nor can they provide leadership on tackling climate change in the international arena. The Prime Minister has failed to demonstrate leadership on the low-carbon agenda, having tried and failed to turn the Conservative Party green. Many senior Conservative politicians and a majority of general election candidates, many of whom are now MPs, refused to back action on climate change and low-carbon energy, while across the country Conservative councils block the majority of wind-farm proposals.

The new Government still need to answer many questions about their energy and climate change agenda. How can they claim the credibility to deliver a new generation of nuclear power stations as long as the Secretary of State is an avowed opponent of nuclear power? How will they deliver on renewables and on action to reduce emissions while many Conservative MPs and councillors remain sceptical about climate change and the need for low-carbon energy? How will the targeting of industrial subsidies for cuts help our transition to a secure low-carbon economy? Surely scrapping the Infrastructure Planning Commission is likely to prove a charter for delay on vital infrastructure projects and for nimbyism.

As regards transport, the decision to scrap the third runway at Heathrow and an additional runway at Stansted will not reduce the number of flights or make a contribution to a greener environment. All it will do is hand the business advantage to Schiphol Airport in Amsterdam, Charles de Gaulle Airport in Paris and Madrid Airport. There will not be fewer flights. The business will be handed to our competitors.

I welcome some assurance on the future of Crossrail, which many people agree is a vital contribution to transport. We welcome the commitment to high-speed rail, but I return to my previous point on the scrapping of the Infrastructure Planning Commission. Will we be able to deliver Crossrail?

As to comments on Royal Mail and the injection of private sector capital, far be it from me to deny previous government policy on this. However, we still believe in a publicly owned Royal Mail. Before making a judgment, our view will be based on whether proposals will deliver reliable and high-quality postal services, which are underpinned by a strong universal service for households and businesses in Britain. Our vision is of a Royal Mail with a secure future and in good health, which provides customers with an excellent service and provides employers with rewarding employment. We want to protect the universal service. The British people rightly cherish the principle of letters collected and delivered anywhere in the UK, six days a week, for a single affordable price. Finally on this issue, as we know, the history of employment relations in Royal Mail has been fraught with difficulty. We have arrived at a situation where the modernisation programme has been agreed. Disturbing that situation needs careful thought.

Given the number of speakers, I will pick out only one or two points; nor would I want to deprive the noble Lord, Lord Henley, the sheer pleasure of answering the range of questions. The noble Baroness, Lady Wilcox, said that the cuts would improve efficiency and spoke about reckless borrowing. A number of comments were made about the extent of government investment. Perhaps we should remind ourselves that some of that investment will have a good return. The investment put into Lloyds and RBS would be capable of achieving a significant return for the Government should they wish to take that opportunity.

I welcome my noble friend Lord Bhattacharyya’s reference to the importance of the minimum wage and the extra money put into the science budget, as well as his analysis of the importance of manufacturing and the role of the RDA in the West Midlands. My noble friend Lord Haskel pointed out that Britain has become more prosperous and greener, and is a better place to live. He also pointed out the difficulty that the Government will have in their attempt to cut red tape and at the same time say that sometimes there is a need for more regulation. Surely we should go not for an approach which says that if we bring in one piece of regulation we will remove another, but for an approach which says that we are looking for better regulations.

I also welcome the appreciation expressed by the noble Baroness, Lady Garden, of the progress that was made on apprenticeships, and I welcome the Government’s initiative to increase them. However, I am concerned that that is going to remove money from Train to Gain. We should not forget that we need to address the skills deficit that exists in this country, and the fact that the Leitch report is still relevant. I utter a word of caution in that area.

The noble Lord, Lord Oakeshott, suggested that my noble friend Lord Myners supports the Government’s proposals on capital gains tax. I should also utter a word of caution on my noble friend’s behalf that that is not his position; I went to the horse’s mouth and he assures me that that is not what he said.

My noble friend Lord Whitty and I will have to disagree on one or two issues, such as on the question of Royal Mail and on a third runway at Heathrow. I take this opportunity to congratulate the noble Lord, Lord Low, on his balanced analysis of the way to deal with the deficit and the importance of the pace of any reduction. My noble friend Lady Kennedy made a strong plea for fairness when finding our way through the deficit problem, and that this should be dealt with through strong growth and high employment.

Given the number of economists we have in the Chamber, it is not surprising that there was some difference of opinion. I cannot help reflecting on the old cliché that if they were laid end to end, they still would not reach a conclusion. However, I must admit that I was captured by the analysis made by the noble Lord, Lord Skidelsky, of the way forward and the relevant point he made about cutting the deficit now: how will that actually promote the recovery? On that note, I shall leave it to the noble Lord, Lord Henley, to answer the questions.

22:27

[The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Henley)]

My Lords, it has been quite a long time since my noble friend Lady Wilcox opened the debate, since when we have heard from some 52 or 53 speakers. As the noble Baroness, Lady Kingsmill, said, we have seen the House of Lords possibly at its best and certainly at its widest in terms of the number of subjects we have covered. It is now my job to try to respond to the wide range of subjects before us, covering a whole array of different departments: the Treasury, transport, energy and climate change, business and my own department, Defra, which I shall get on to in due course.

I shall start by offering my commiserations to the noble Lord, Lord Myners, because he told us that this was his swansong on the Front Bench. As many other noble Lords have said, we will miss him and we look forward to seeing him on the Back Benches. I think it was his noble friend Lady McIntosh who suggested that possibly it was the first of many swansongs and that he was going to become the veritable Frank Sinatra of the Opposition Front Bench by making repeated final speeches. I look forward to those. I also offer my thanks to the noble Lord, Lord Whitty, who offered me some very useful advice from Defra, the department in which he has held office, as has the Lord Speaker and the noble Lord, Lord Rooker. The noble Lord made the simple point that nothing is quite as complicated as people tell him.

I shall start by saying a word or two about my own department. As my noble friend Lady Wilcox emphasised in her opening speech, it is the Prime Minister’s ambition that this Government should be the greenest Government ever. Reducing greenhouse gas emissions, care for the environment and understanding the value of our natural resources should inform all that we do, and it is the responsibility of Defra to ensure that this imperative is understood by government and all others. We are there to explain and promote the economic value of natural resources so that they are managed better and so that those who come after us do not face hardship and disaster through their growing scarcity. We work to ensure a thriving biodiversity and wildlife by preventing habitat loss and degradation; we act to prevent deforestation and to protect the marine environment; we help businesses and communities to adapt to the effects of a changing climate; and we help those sectors for which we are responsible to reduce their greenhouse gas emissions and to contribute to the fight against climate change.

However, Defra is not only concerned with the environment; it is also an economic department. In fact, our departmental remit shows that you cannot separate the two. Therefore perhaps our most important job is to show just how the economics and the environment are intertwined.

During the course of the debate I heard repeatedly from this or that noble Lord that they hoped the Minister would in due course comment on their own particular issue. However, that will simply not be possible. I jotted down a range of different subjects, some of which were raised repeatedly, and I hope I will be able to comment on some of the bigger issues. I think noble Lords will understand that I shall not be able to answer every question that was put to me but, as the noble Lord, Lord Myners, put it, I shall do my best to write to all noble Lords—as I did in my previous incarnation as a Minister and as I am sure all Ministers do—in due course when I have collated all the responses from the different departments. However, as I said, I shall try to deal with one or two of the concerns that have been raised today.

I shall start with the Office for Budget Responsibility because that is where the noble Lord, Lord Myners, started. He asked a number of detailed questions which he would not expect me to answer at this stage and which I shall deal with by correspondence. However, I can give him the assurance that it will be independent—that is important—and that independence will derive from it having complete control over the forecasts it will produce. I was grateful that the noble Lord, Lord Bilimoria, saw that that was a positive step. On the detailed questions, as I said, I shall write to the noble Lord.

Turning to the deficit, the subject most mentioned by noble Lords—indeed, so many noble Lords raised the subject that I cannot list all their names—there were varied views on what to do about it but everyone accepted that it had to be tackled. Even the noble Lord, Lord Myners, accepted that the deficit had to be tackled but felt, as did others—but by no means the majority—that it should not be tackled too quickly. I shall quote the views of the Governor of the Bank of England on this subject. He said:

“The bigger risk at present would be for a new Government not to put in place clear and credible measures to deal with the deficit”.

We are currently running one of the largest deficits in the world. That is simply not sustainable and the longer we delay action the greater the risk of a loss of market confidence, which would mean higher interest rates for all.

I will give way to the noble Lord, Lord Lea of Crondall, just this once, but it is his third intervention in the course of the debate.

[Lord Lea of Crondall]

It is an important question. Perhaps the Minister could write to me and put his reply in the Library. Is he talking about the complete deficit or about a recession-adjusted deficit? How has it suddenly become a recession-related deficit of 11.1 per cent when it was only 2.5 per cent 18 months ago?

[Lord Henley]

That is a question that the noble Lord will have to put to the previous Government, who saw it rise to that level. I shall of course write to him in due course and, as I always do, put a copy of the letter in the Library.

The longer that we delay action on the deficit, the greater is the risk of that loss of market confidence. As I said, that would mean higher interest rates for all, stifling recovery and making challenges ahead even harder.

[Lord Myners]

I am grateful to the Minister for allowing me to ask just one small question. It is clear that the size of the deficit will be a function of the expected rate of economic recovery and growth; the two interplay. I believe that the Minister said that the OBR would make independent forecasts. Will he confirm that it will make economic forecasts as opposed to auditing or commenting on Treasury forecasts?

[Lord Henley]

The forecasts of the OBR, as I made clear, will be independent. It is for it to make those independent forecasts. I was trying to stress its independence. I shall write to the noble Lord on that in greater detail, but its independence was his principal concern. He will have a chance to see the first of those forecasts quite soon, as I understand that the first of them will be out before the Budget. If I am wrong about that, I shall let him know in due course.

One should also refer to the OECD’s recent economic report, which argues that a more rapid fiscal consolidation would help the recovery by leaving room for interest rates to remain lower for longer. That will support spending by households and by business. The importance of taking action this year is underlined by recent events in the eurozone. Failure to take action would put that recovery at risk.

I turn to questions asked about tax. Noble Lords mentioned CGT, income tax and tax avoidance—that was the noble Lord, Lord Oakeshott. We heard confessions from the noble Lord, Lord Desai, about his having to resign from the pre-1997 opposition Front Bench for his views about that. As I remember it—the noble Lord will no doubt correct me—he had to resign from the opposition Front Bench more than once.

[Lord Desai]

I was sacked.

[Lord Henley]

I remind the House for its amusement that the second occasion on which the noble Lord was sacked, or it might have been the first, was the result of his having informed the House, or perhaps the world more generally, that his then leader—we shall not mention which leader it was—was no economist. That struck me as a statement of the obvious, but he was sacked nevertheless.

Many noble Lords have raised CGT, VAT, income tax and tax generally. The noble Lord, Lord Myners, pressed me to give an explanation of what was going on. I have to remind him, first, that I am not a Treasury Minister and, secondly, that I think he knows the date of the Budget. Neither the noble Lord nor any other noble Lord expects me to second-guess my right honourable friend. It is very tempting to do so, but it is one of those occasions where one has to say that it is beyond my pay grade. The noble Lord will have to wait three weeks until the Budget to hear answers on those matters.

I appreciate that time is moving on, so I shall say a little about policy on climate change, which was another subject that attracted a great many speakers. I was grateful for the support that came from many noble Lords, but I noticed the concern expressed by two sceptics—I think that that is the right word—on my own Benches, my noble friends Lord Lawson and Lord Reay. As the noble Lords, Lord Whitty and Lord Hunt of Chesterton, and my noble friend Lord Jenkin put it, there is a need to convince the public on this issue. It might be more than just the public that we have to convince; it might be some of my noble friends. Certainly, there are matters that we need to look at here, and a great number of matters on which I shall have to write to noble Lords in due course to deal with their concerns. For example, the noble Lord, Lord Whitty, raised the question of the Government’s commitment to the renewable heat initiative. That is something that we are committed to supporting, but we still need to consider the various options for promoting it most efficiently.

We will look at all the other renewables that noble Lords mentioned—and my noble friend Lord James referred to the possibility of tidal power on Dogger Bank. As my noble friend himself admitted, some pretty great technological challenges face us in an area such as that. I also give an assurance to my noble friend Lord Teverson that we will certainly push the EU to demonstrate leadership by tackling the levels of international climate change and supporting the increase in the EU emission reduction target to 30 per cent by 2020.

There were some fairly technical questions from my noble friend Lord Jenkin and the noble Lord, Lord Giddens, on the carbon floor price—questions that are slightly beyond my level at the moment. That is something for other departments, but I can give an assurance that we will introduce a carbon floor price because we recognise that the long-term certainty of the carbon price is one factor that affects investment decisions in low-carbon electricity generation. The exact timing of its introduction needs to be considered further but will need to fit the objective of increasing incentives for low-carbon generation. I note the concerns expressed by my noble friend Lord Jenkin on the speed of planning decisions.

I turn to the question of whether nuclear power needs subsidy, a point raised by the noble Lord, Lord Giddens. We believe that it does not need public subsidy and, on that basis, energy companies have already come forward with plans to build and stand up to 16 gigawatts of new nuclear energy. Certainly, we are keen on new nuclear energy, and I can give that assurance to the noble Lord, Lord O’Neill of Clackmannan. On his more detailed question about the funding for Sheffield Forgemasters, as he will be aware, the Treasury has asked all departments to look at all spending approvals since 1 January this year, which would include that project. Due diligence is required because of the budgetary position that this Government inherited from the Government of whom the noble Lord was such a supporter, to see whether those plans are affordable and consistent with government priorities. If they are consistent with that, they will go ahead—but that is all that I can assure him of at the moment.

I shall say a word or two about regional development agencies, which were raised by the noble Lord, Lord Bhattacharyya, and the right reverend Prelate the Bishop of Liverpool, who spoke about the regional development agency in my area and his area—the Northwest Regional Development Agency. My noble friend Lord Bates spoke of One North East, the RDA covering Newcastle. As my right honourable friend the Prime Minister stated last Friday, an early task of this Government will be to reform and refocus regional support and the RDAs. Therefore, we will be looking at all the RDAs. He stated that he will assign Ministers and senior MPs to some of our biggest cities with responsibility to work with local communities to help to drive forward economic development by ensuring that blockages in Whitehall are dealt with. We will certainly want to look at the RDAs—but I think that the RDAs in the north might be a special case.

With regard to electricity supply, the noble Lord, Lord Oxburgh, talked about a looming crisis. The noble Lord stressed that there had been, I believe, 17 Energy Ministers in the past 10 years. It seems, then, that while he rather politely put it as a looming crisis of our own making, it is possibly a crisis of the party opposite’s making if it was changing Ministers that often and not making the necessary decisions. We recognise that there is a need for a systemic approach to developing a framework that will both deliver energy security and meet our climate change objectives. We have proposed a set of interventions, including an emissions performance standard, that aim to deliver a secure, low-carbon, cost-effective and competitive energy sector. Our electricity market reform project will ensure that we deploy the right mechanisms in the right way at the right time.

A number of noble Lords talked about agriculture, principally in relation to problems that my noble friend Lady Byford raised about the Rural Payments Agency, which was also mentioned by the noble Lord, Lord Greaves, and others. I declare an interest as a recipient of funds from the RPA as a farmer. We are all aware of the problems within the agency, and the department will be seeing what it can do about dealing with them. We will also be looking at changes, as asked for by my noble friend the Duke of Montrose and others, in the common agricultural policy. I believe, and I think that everyone in this House would accept, that that means genuine reform of the policy. We will certainly push for that as and when we can.

Moving on to some of the issues raised about the Royal Mail and the postal services Bill by the noble Lord, Lord Whitty, we understand the concerns on all sides about the future of the Royal Mail and the real affection in which it is held. However, the Government are now looking at the detail of how to ensure that the Royal Mail can benefit from a degree of private sector capital and discipline and how it can modernise—possibly, as I think one of the right reverend Prelates suggested, in partnership with employees. We will announce details of our plans in due course, but I stress that we will seek to modernise the Royal Mail in conjunction with its employees.

I shall say a quick word about transport, the final department that was covered. We had a great many suggestions from the noble Lord, Lord Bradshaw, some more radical than others. I think that he suggested a purge of an entire division within the Department for Transport; I am not sure quite how brutal that purge would be, but no doubt he can let us know.

We also heard comments from my noble friend Lord Glasgow about high-speed rail being not purely a local English matter but a British matter. Like my noble friend, I have an interest in high-speed rail in that I live more than three and a half hours away from London under the current regime. I refer the noble Earl to the commitments that were made in the coalition document: this will be a truly British high-speed rail network. At this stage, one has to say that the timing is another matter. These things are very expensive but the commitment is there and it is a commitment to a high-speed railway that would be truly British, rather than taking us merely as far as Birmingham or Manchester.

I end by saying, again, that I will in due course write to all noble Lords. I hope that I can answer all the questions that have been put before me. As my noble friend Lady Wilcox said earlier today, any sensible family or business knows the dangers of too much debt. The debt is the first thing that we must concentrate on. We cannot recover without reducing it. That will be the Government’s first aim. I was grateful for the endorsement of the noble Lord, Lord Myners, for that. We must do that while adhering to the values, as my right honourable friend the Prime Minister said, of freedom, fairness and responsibility, and of knowing and respecting the value of our natural environment.

Debate adjourned until tomorrow.

House adjourned at 10.51 pm.