House of Commons

Tuesday 7th September 2010 Commons Chamber

Tuesday 7 September 2010

The House met at half-past Two o’clock

Prayers

Tuesday 7th September 2010 Commons Chamber

[Mr Speaker in the Chair]

Oral Answers to Questions

Tuesday 7th September 2010 Commons Chamber

The Secretary of State was asked—

[Neil Carmichael (Stroud) (Con)]

1. What steps he is taking to work with clinicians and patient groups in the design of the cancer drugs fund.

[The Secretary of State for Health (Mr Andrew Lansley)]

We are committed to ensuring that the cancer drugs fund, which is to be introduced in April next year, will enable NHS patients to have greater access to new cancer drugs. We will soon consult the public and clinicians on our plans for this. From 1 October this year, as an interim measure, regional panels led by expert clinicians will respond to requests to fund cancer drugs that have not been funded locally.

[Neil Carmichael]

I am delighted with the answer from the Secretary of State. Some people are concerned about the possibility of a postcode lottery. Has the Department thought about that, and what actions does it plan to avoid the fund being subject to that?

[Mr Lansley]

I am grateful to my hon. Friend. Many people are concerned about their experience of a postcode lottery and access to new cancer drugs. Indeed, there is not just a postcode lottery but an international lottery, with patients in this country not getting access through the NHS to new cancer drugs while patients in other countries do get access to those drugs in the same clinical circumstances. That is why we will not only establish the cancer drugs fund next year, but, this year, we have found £50 million by making savings on management and marketing costs to enable new cancer drugs to be made available, at a regional level across England, where they are not funded locally.

[Valerie Vaz (Walsall South) (Lab)]

Has the Secretary of State had any discussions with the National Institute for Health and Clinical Excellence about the fund, and is it cash-limited?

[Mr Lansley]

Yes, I did have discussions with NICE. The interim measure this year is indeed cash-limited—£50 million is available between October and the end of March.

[Anne Marie Morris (Newton Abbot) (Con)]

Will the Secretary of State consider seriously the situation with regard to Avastin—a drug that particularly relates to bowel cancer? I have a constituent who is dying of that complaint, and their primary care trust has refused treatment under current NICE guidance. NICE is currently reviewing the situation. I would be grateful if the Secretary of State will say that he will support positive findings.

[Mr Lansley]

My colleagues and I are very well aware of the issues relating to Avastin, and I am grateful to my hon. Friend for her question. In terms of the interim measure that starts on 1 October, patients should go through all the normal procedures of seeking treatment through their hospital with the consent of their PCT. However, if that fails, a regional panel of expert clinicians will be able to look at their circumstances, with a special fund to enable patients to have access to cancer drugs which previously they would not have received.

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

Of course we support efforts to ensure that those with rarer cancers get access to the drugs that they need, but there are serious concerns about the cancer drugs fund. Professor Alan Maynard says that

“this will run a coach and horses through the work done by NICE”.

The Lancet has called the fund a product of political opportunism and intellectual incoherence leading to the potential for a postcode lottery between strategic health authorities. Where does this leave NICE—an organisation that the Secretary of State said that he wants to strengthen?

[Mr Lansley]

It in no way undermines the role of NICE, which continues to play a very important role in giving advice to the NHS on the relative clinical effectiveness and cost-effectiveness of drugs. However, there are many circumstances at the moment whereby patients are not getting access to medicines. NICE, through its thresholds, is setting limitations on access to new cancer medicines. The hon. Lady should know, because the research was commissioned under her Government, that we need to look at international variations in drug use across health economies. Her Government did not publish that information; we have published it. It demonstrates that in this country we have relatively poor access to new cancer medicines, often before the point at which NICE has undertaken a full cost-effectiveness appraisal. We are going to ensure that patients in this country do not lose out as a consequence of those delays.

[David Tredinnick (Bosworth) (Con)]

When considering the drugs fund, will the Secretary of State bear it in mind that many patients who have had chemotherapy find relief from using herbal medicine and acupuncture? When will he come forward with proposals to interface with next year’s European directive so that herbal and acupuncture practitioners can conform to the law?

[Mr Speaker]

I know that the Secretary of State’s response will relate to the cancer drugs fund.

[Mr Lansley]

The answer to my hon. Friend’s question is soon.

[Mr Speaker]

We are grateful.

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

2. What account he took of arrangements for the provision of mental health services in developing his proposals for GP commissioning.

[The Minister of State, Department of Health (Mr Paul Burstow)]

GPs play a crucial role in co-ordinating patient care and committing NHS resources through daily clinical decisions. Our new model of commissioning builds on the regular contact that GPs have with patients and their understanding of patients’ wider health care needs. Our proposals will create an effective dialogue across all health and social care, with professionals putting in place the conditions for a more integrated and personalised approach to both physical and mental health.

[Emma Reynolds]

I thank the Minister for his answer. According to a recent survey by the leading mental health charity Rethink, 58% of GPs questioned said that they did not feel they had the level of expertise required to commission mental health services. Given that, what specific measures will the Government take to ensure that GPs have the skills and expertise needed to commission those highly specialised services?

[Mr Burstow]

I do not accept that that is the case, and from the consultation and engagement that the Department and I have already had with GPs and others, it is quite clear that there is huge enthusiasm for the reforms that we propose in the White Paper and a real desire both to see patients put at the heart of the NHS and for GPs to have real control over commissioning again, to ensure that services really meet patients’ needs. When it comes to specialist commissioning, we have said in the White Paper that there will be opportunities for charities, other providers and local authorities to access support to harness those skills.

[Mr Stewart Jackson (Peterborough) (Con)]

Parnwell, in the east of Peterborough, which has specific health needs, faces the loss of its current single general practitioner upon his retirement at the end of October. Can the Minister confirm that there is no necessity to remove single practitioner GP facilities, and that they can be incorporated into the new GP commissioning system as we go forward?

[Mr Burstow]

I am very happy to give that confirmation.

[Barbara Keeley (Worsley and Eccles South) (Lab)]

It is of great concern that medical charities such as Rethink tell us that most GPs that they have surveyed feel that they lack the expertise needed to commission mental health services, and also that campaigning groups such as the Muscular Dystrophy Campaign feel that GPs have too little knowledge of muscle wasting conditions to commission services for their patients. Given Government plans to hand commissioning over to GPs, to abolish primary care trusts and, according to the White Paper, to reduce the role of the Department of Health in training, can the Minister say more to the House about how the considerable shortfall in expertise in commissioning services will be tackled over the next year or two?

[Mr Burstow]

It is perhaps worth noting that the Select Committee on Health, when there was a Labour majority on it before the election, back in March, identified significant weaknesses in PCT commissioning. In particular, it identified the lack of clinical input. Our White Paper puts that clinical input back into commissioning. When one considers that one in four of all consultations involve mental health problems and that 90% of all mental health care is delivered in primary care settings, one sees that putting the GP right at the centre is critical to better outcomes.

[Dr John Pugh (Southport) (LD)]

On the subject of consultation, what consultations have taken place with the mental health charities, either prior or subsequent to the proposals?

[Mr Burstow]

In July, I and the Secretary of State had a successful and long engagement with all the mental health charities, and we are continuing to have a dialogue with them.

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

3. What estimate he has made of the number of redundancies which would result from the abolition of strategic health authorities and primary care trusts?

[The Secretary of State for Health (Mr Andrew Lansley)]

Our White Paper set out proposals for greater devolution to clinical leadership in the NHS and an enhanced role for local authorities in setting health strategies and improving public health. That means that we will abolish primary care trusts and strategic health authorities. General practice-led consortiums will make decisions about their requirements for management support, as will the new NHS commissioning board and local authorities. However, the requirement to cut management costs and protect the front line will mean reduced numbers of administrative posts. The extent of that will depend on local plans, and we will publish an impact assessment in due course.

[Mr Cunningham]

The coalition agreement stated that PCTs would be a strong voice for the public. How will the Government achieve that if they are going to abolish them?

[Mr Lansley]

We set out clearly in the White Paper how we will increase accountability to the public, including by establishing Health Watch. Before the election, the hon. Gentleman’s party’s Government demolished the patient representative voice in community health councils and patients’ forums and created nothing effective in its place. Health Watch will be an effective voice for patients, and democratic accountability through local authorities will be far stronger because Health Watch will enable NHS services, public health services and social care to be joined together through co-ordination in a local authority’s health and well-being partnership.

[Mark Pawsey (Rugby) (Con)]

On the question of redundancies, the hon. Member for Coventry South (Mr Cunningham) and I represent adjacent constituencies covered by the same NHS trust, in which there is currently a review of urgent care provision at the hospital of St Cross in my constituency. Candidates for the Labour leadership recently visited the area, and one spoke to the Rugby Advertiser about his concern that the review was an example of the

“economic masochism being unveiled across the country by the Tories who continue to show no compassion for the vulnerable.”

Does the Secretary of State share my outrage at the choice of language by the likely Leader of the Opposition, and will he confirm that since this Government have committed themselves to real-terms increases in NHS funding, any reforms considered for Rugby will have nothing to do with the amount of funding for the local NHS?

[Mr Lansley]

I am grateful to my hon. Friend. We visited St Cross hospital together, so he knows the importance that we both attach to the service that is provided there for his constituents locally, but that happens in the context of the resources that we provide to enable the NHS to do its job. The Government have made an historic commitment to increase resources for the NHS in real terms each year, notwithstanding the appalling financial circumstances that we inherited from the Labour party.

The policy of the right hon. Member for Leigh (Andy Burnham) is to cut the NHS budget. Under those circumstances and under the policies of the Labour party, the number of redundancies in the NHS would proliferate.

[Andy Burnham (Leigh) (Lab)]

The right hon. Gentleman is planning the biggest reorganisation in the history of the NHS, and yet he is unable to give basic information on it, such as how many people may lose their jobs, to my hon. Friend the Member for Coventry South (Mr Cunningham). Tens of thousands of people who work for primary care trusts and strategic health authorities are at risk of losing their jobs, so it is no wonder that after a just a few short weeks in his job, the Secretary of State has brought morale in the NHS to rock bottom.

In his letter to the NHS, the NHS chief executive says that £1.7 billion should be set aside to pay for the Secretary of State’s reorganisation. Others have said that the cost of his reform could be up to £3 billion. At a time when the NHS needs every penny to maintain standards of patient care, it is scandalous for money to be diverted in that way. He may be ignoring the human cost, but can he tell the House today his latest estimate from the Department of how much his ideological reorganisation will cost?

[Mr Lansley]

I do wish the right hon. Gentleman would at least remember what he was responsible for before the election. He said that the NHS in this financial year should set aside 2%—£1.7 billion—for the cost of reorganisation. I have not changed that figure by one penny. However, I have taken his policies, which led to a proliferation in management costs—an 80% increase in the cost of management consultants in the NHS in two years and a doubling of management costs in PCTs and SHAs in eight years—and reversed them. We are cutting management costs in the NHS this year by more than £220 million and by up to £1 billion over four years. I make no apology for that, because if we are to protect front-line services and improve health outcomes, that is exactly what we need to do.

[Andy Burnham]

rose—

[Mr Speaker]

Order. The remainder of this exchange—on both sides— needs to be shorter.

[Andy Burnham]

Let us first get some facts straight. I asked PCTs to set aside money to invest in patient care, changing patient pathways and better services. I did not say that a Labour Government would cut the NHS budget; I said that we would maintain it in real terms, not increase it, as the Secretary of State proposes. The effect of his increase will mean severe cuts to councils, which need to provide care support to older people to get people out of hospital.

However, the Secretary of State would not today tell us what his proposals would cost. Is it not the case that the plans were not in the Conservative or Liberal Democrat manifestos, and that there is no democratic mandate for the break-up of the NHS? Given that there is now a chorus of protest at his plans, will he step back, listen to patients and staff and consult on those reforms before taking them forward further?

[Mr Lansley]

I and my colleagues are engaging right across the country with patients, the public, local authorities, PCTs and general practitioners, and we are meeting enthusiasm for our proposals. Why? Because we are focusing on delivering improving outcomes for patients, and doing so in the context of an historic commitment by this coalition Government to increase resources for the NHS in real terms each year. The right hon. Gentleman’s policy would be to cut the NHS budget.

[Andy Burnham]

The Secretary of State thinks he can behave any way he likes with the NHS, the most beloved institution in this country, but we will not let him—we will give him a fight every inch of the way. The latest example of his high-handed and arrogant behaviour came on the eve of a bank holiday weekend, when he casually let slip that NHS Direct would be scrapped. NHS Direct is a valued service that receives 27,000 calls every day and saves millions of pounds for the NHS, and that has more than 3,000 staff working for it. Will he today apologise for making that statement in such an outrageous manner? Will he listen to the 14,000 people who signed a petition to save NHS Direct, and going forward, stop acting in such a cavalier manner with our NHS?

[Mr Speaker]

Order. A question should be a question—it should not really be three questions.

[Mr Lansley]

Once again, the right hon. Gentleman should remember what he did before the election. A press release from his Department on 18 December 2009, when he was Secretary of State, said that he would establish a new 111 national number for non-emergency health care, and that this could become the single number to access non-emergency care services, including NHS Direct. I did not announce anything: I simply said that we were going to get on with that—he never did.

[Mr Peter Bone (Wellingborough) (Con)]

4. What plans he has for the future of the national capitation formula.

[The Minister of State, Department of Health (Mr Simon Burns)]

Revenue allocations post 2010-11 will be set following the spending review. From 2013-14, the NHS Commissioning Board will allocate the majority of NHS resources to GP consortiums on the basis of seeking to secure equivalent access to NHS services relative to the burden of disease and disability. Public health resources will be separately allocated to reflect relative population health need and to seek to reduce health inequalities.

[Mr Bone]

Under the Labour Government, Northamptonshire was the worst funded primary care trust in the country. That was because the Government never met the national capitation formula in full, denying Wellingborough a hospital, for instance. Will the Minister’s new proposals be fairer and encourage my constituents in the belief that they will get a better deal?

[Mr Burns]

I am grateful to my hon. Friend for that question, because he is right—under the Labour Government, Northamptonshire Teaching PCT was underfunded and is currently receiving 1.4% below its target allocation. That is why my right hon. Friend the Secretary of State and I are seeking, under the vision outlined in the White Paper, to free the NHS from day-to-day political interference so that the allocation of resources will be the responsibility of the NHS Commissioning Board which can seek to address the problems highlighted by my hon. Friend.

[Mr David Hanson (Delyn) (Lab)]

5. What recent discussions he has had with the Welsh Assembly Government on the effects of proposed changes to health services in England on patients living in Wales who use those services.

[The Parliamentary Under-Secretary of State for Health (Anne Milton)]

Since the election, there have been informal, but no formal, discussions between my right hon. Friend the Secretary of State for Health and the Welsh Assembly Government. However, I understand that a meeting is planned for later this year. Clearly, there have been discussions between officials about the impact of the White Paper and the changes.

[Mr Hanson]

May I respectfully suggest that someone in the Government gets on and talks to the Welsh Assembly Government? A third of my constituents, who live in Wales, use the Countess of Chester hospital in England, and they use hospitals in Manchester, including the Christie and the Clatterbridge for cancer services, as well as the Robert Jones and Agnes Hunt hospital in Shropshire for orthopaedic services. They are as appalled as I am by the changes being proposed by the Conservatives to destroy the NHS. Get on and talk to someone please.

[Anne Milton]

May I thank the right hon. Gentleman for his question and assure him that officials have got on with it and do it constantly? It is important that we ensure that any changes are synchronised across the two areas, and I know that he will continue to raise cross-border issues. I can reassure him that we have already got on with it and he need not remind us to do so.

[David T. C. Davies (Monmouth) (Con)]

Given that patients in Wales, served by the Welsh Assembly, have to wait far longer for routine operations and ambulance responses, is it not the case that the only problem that the Department will face is that the people of Wales will be galvanised by the excellent policies of this Government into suggesting that the Welsh Assembly Government ditch their failed health policies and copy those of the coalition Government?

[Anne Milton]

I thank my hon. Friend for that wonderful advertisement for the changes that we are bringing in. I agree with him and I am sure that the people of Wales will see the changes that we are bringing in and contact the right hon. Member for Delyn (Mr Hanson) to urge him to ensure that the changes are also introduced in Wales.

[Hywel Williams (Arfon) (PC)]

Fourteen thousand people from Wales are registered with GPs in England, and 19,000 people from England are registered with GPs in Wales. Will the Under-Secretary ensure that the changes that she brings in do not lead to any dangers to the services provided for both sets of people travelling across the border, and that adequate financial recompense is made as well?

[Anne Milton]

It is extremely important that people receive similar and safe passage and continuity of care across the borders, and we will continue to have conversations, both at ministerial level and between officials, to ensure that any hitches that arise are smoothed out as soon as possible.

[Caroline Flint (Don Valley) (Lab)]

7. How many GPs in Doncaster have expressed an interest in establishing GP consortiums.

[The Minister of State, Department of Health (Mr Simon Burns)]

The Yorkshire and Humber strategic health authority has informed me that two existing practice-based commissioning consortiums are currently working on behalf of all Doncaster’s 45 GP practices. GPs in Doncaster are enthusiastic about the agenda and, in partnership with Doncaster primary care trust, have established a transition team meeting to oversee the process.

[Caroline Flint]

Yes, there is something called the “Doncaster commissioning consortium” in Doncaster, which provides clinical leadership to Doncaster PCT when it comes to commissioning. From what I understand from the Government’s proposals, as a result of these changes the Doncaster commissioning consortium, made up of the majority of GPs, will have to employ people, either from the PCT or other sectors, to do the budget and management of commissioning. Is this restructuring not just a rebranding to make the Government look as if they are being innovative in health care when in fact they are pouring money down the drain and conducting a restructuring that we just do not need?

[Mr Burns]

May I recommend that the right hon. Lady, who from her past ministerial career is familiar with health issues, study not only the White Paper that we have published, but the documents, particularly on commissioning, that flowed from that, because I am afraid that her interpretation of the situation is wrong? This is a great change from the PCT system, because it will basically ensure that commissioning will no longer be remote but be carried out by GPs at the forefront of dealing with patients’ needs and care, who know best how to ensure that patients get the finest and best health care possible.

[Dr Daniel Poulter (Central Suffolk and North Ipswich) (Con)]

8. What plans he has to assist GP commissioning in rural areas.

[The Parliamentary Under-Secretary of State for Health (Anne Milton)]

Our proposals in the White Paper will enable general practices to structure commissioning to reflect the character of the area they serve. Practices in rural areas, such as Cumbria and Cambridgeshire for instance, are exploring commissioning models. To support GP consortiums, we will create a statutory NHS commissioning board.

[Dr Poulter]

The Minister will be aware that many women make the choice to have a home birth and delivery, but unfortunately, in many rural areas, maternity services have historically been under-resourced. What steps does the Minister envisage better to support home delivery in rural areas, and to support GPs in their commissioning of these services in the future?

[Anne Milton]

I congratulate my hon. Friend on taking up the chairmanship of the all-party group on maternity. I know that his work with it will be very valuable, particularly in the light of his previous experience in the health service. Contrary to what Labour Members believe, this is an important opportunity to put general practices—in all their shapes and forms within all the professions—at the very heart of shaping services. As he said, home births and choice in maternity services are crucial for women.

[Ann Coffey (Stockport) (Lab)]

I have concerns about the effect of the Secretary of State’s proposals for GP commissioning on services in rural areas and urban areas such as mine. Greater Manchester PCT provided strategic leadership in the recent reconfiguration of children’s services, which was very contentious. Can the Minister clarify how that strategic leadership will be provided in the future reconfiguration of cancer, maternity and ambulance services in Greater Manchester, as GP commissioning will be focused on local health needs and national commissioning on national specialities?

[Anne Milton]

The hon. Lady made the point that urban and rural areas have very different needs. What is vital are the people on the front line, making decisions and offering the leadership and vision to shape those services. I do not think that she will find many people lining up to save PCTs, whose commissioning has not always been as successful as she would like to believe.

[Dr Thérèse Coffey (Suffolk Coastal) (Con)]

I should like to suggest to the Minister that it might help GPs who are commissioning in rural areas if the formula for capitation were to include the information that their patients live in sparsely populated areas, as well as information about their age, especially in constituencies such as mine and that of my hon. Friend the Member for Central Suffolk and North Ipswich (Dr Poulter).

[Anne Milton]

My hon. Friend is right to raise the issue of the distances covered in rural areas. I believe that only ambulance trusts currently have the opportunity to reflect that. This is why it is so important that local commissioners will shape the services for their patients. It is they, not the pen-pushers in the PCT, who know best what is right for their patients.

[Keith Vaz (Leicester East) (Lab)]

9. What steps his Department is taking to inform young people about diabetes prevention.

[The Minister of State, Department of Health (Mr Paul Burstow)]

I thank the right hon. Gentleman for his question, and for his tireless campaigning to raise awareness of diabetes. We know that being physically active and maintaining a healthy weight can reduce an individual’s risk of developing type 2 diabetes and cardiovascular disease. Our approach is to support families and young people to eat healthily and be physically active.

[Keith Vaz]

I thank the Minister for his comments. I declare an interest as one who has type 2 diabetes. As he knows, we spend £1 million an hour treating diabetes-related illnesses, and more and more people are now being diagnosed at a much younger age. What steps are the Government taking to alert parents and young people to the perils of diabetes?

[Mr Burstow]

The right hon. Gentleman is absolutely right to draw our attention to the rising rate of diabetes in our country. When it comes to diabetes in children, we have to bear in mind that the diagnosis for type 1 diabetes—which affects about 23,000 children in this country—is a genetically predisposed condition that cannot easily be prevented. We need to do more about type 2 diabetes, however, by tackling the obesity problems in this country. We need to deliver physical and healthy eating programmes through schools and other partners, and those things are much better done in the context of the local authorities, which will now have a new responsibility for public health that the last Government never gave them.

[Mr Adrian Sanders (Torbay) (LD)]

Information and education are also important for people with the condition of diabetes, to help them to get the maximum benefit from their prescribed course of treatment. May I urge the Minister to make an assessment of the improvements to health that education and information can contribute?

[Mr Burstow]

My hon. Friend makes a good point about the value of information in empowering patients, and about the value of education. That is why we want to do more with NHS information prescriptions, which is an important tool, and to ensure that the care planning process that delivers tailored care plans also includes structured education. There is no doubt that providing education really does make a difference to the outcomes for people with diabetes.

[Jim Shannon (Strangford) (DUP)]

I thank the Minister for his response to the question. I also wish to declare an interest as a type 2 diabetic. The junk food culture of the moment is a serious problem, so what steps is the Minister taking to address that in his effort to reduce the number of people being diagnosed as diabetic over the next year?

[Mr Burstow]

The best way of responding to the hon. Gentleman’s very appropriate question is to say that we are taking a four-pronged approach to diabetes. First, we need to tackle the causes of the condition through a renewed impetus on public health. We shall announce more of our plans in our White Paper later this autumn. Secondly, we need earlier identification and diagnosis so that we can help people to manage their condition at an earlier stage so that it does not progress. Thirdly, we need effective management and self-directed care. Finally, we need world-class research so that we can better understand the condition and deliver better treatments.

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

10. What steps he is taking to ensure the adequacy of resources allocated to hospital accident and emergency departments.

[The Minister of State, Department of Health (Mr Simon Burns)]

It is the responsibility of local NHS commissioners to plan and arrange adequate A and E health services according to the needs of their local populations. Attendances at hospital A and E departments are reimbursed through mandatory national tariffs.

[Mr Sheerman]

Is the Minister aware that my constituents in Huddersfield are very pleased with the improvements to their A and E services over recent years? They put that down to fewer people going to A and E because they have NHS Direct to take the pressure off A and E, and to the guarantee of being seen within four hours, and having the right to complain pretty vigorously—as we do in Huddersfield—if that does not happen. Are not the measures that the Government are introducing simply going to make A and E impossible again?

[Mr Burns]

May I reassure the hon. Gentleman’s constituents that they will be just as pleased with the responses that they receive from a 111 line, where professional advice and help will be given to people who need to contact it about their health needs? May I also reassure his constituents on the question of four-hour targets? The target that was introduced caused distortions; it was a political target. We are relying on clinical decisions and activity to ensure that people are seen as quickly and relevantly as possible.

[Mr Stephen Dorrell (Charnwood) (Con)]

Does my hon. Friend agree that in addition to the proper funding of A and E departments, it is also important to take steps to manage the demand on those departments? In particular in urban areas, that means that commissioners should accept the responsibility to look for improvements in the delivery of primary care so that patients have more easy access to less urgent care in the primary care context, thus reducing the demand on A and E departments.

[Mr Burns]

My right hon. Friend is absolutely right. It is, of course, not only a question of correctly identifying those people who should use A and E; the other assistance given through the health service is also important. We need a first-class and relevant out-of-hours service as well.

[Hugh Bayley (York Central) (Lab)]

11. What recent assessment his Department has made of the clinical effectiveness of facet joint injections; and if he will make a statement.

[The Parliamentary Under-Secretary of State for Health (Anne Milton)]

Recommendations on facet joint injections were made by the National Institute for Health and Clinical Excellence in its 2009 clinical guidelines on low back pain. NICE did not find sufficient research evidence that strongly supported the effectiveness of facet joint injections and recommended that more research should be done. I understand that the National Institute for Health Research is looking at whether it will commission further research.

[Hugh Bayley]

Access to these injections is restricted in North Yorkshire and York PCT, although it is widely available on the NHS in other areas. The consultant in charge of York’s pain clinic believes that the PCT is not following the most recent NICE guidelines. What are the Government doing to reduce this kind of postcode lottery? Will the Minister contact the PCT and arrange for it to meet me and the consultant to discuss how these guidelines ought to be applied in North Yorkshire and York?

[Anne Milton]

I thank the hon. Gentleman for his remarks and point out that it is precisely because of the situation that he describes that we are bringing in some of our reforms. It is important that decisions about treatment and care are made by clinicians—GPs and a large number of other people, including some voluntary and charitable organisations—and that they are clinically led, evidence-based and also include patient choice.

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

12. What recent discussions he has had on the effectiveness of the National Institute for Health and Clinical Excellence’s procedures to review the cost-effectiveness of drugs; and if he will make a statement.

[The Minister of State, Department of Health (Mr Simon Burns)]

Ministers discuss NICE’s work from time to time as part of routine business. We attach great importance to the work NICE does in giving advice to commissioners and clinicians on the relative clinical and cost-effectiveness of treatments. The right hon. Gentleman will know that we also propose reforms that will better reflect the value of new drugs in the relevant prices paid by the NHS.

[Mr Kennedy]

In thanking the Minister for that helpful reply, I note that my question rather overlaps with the pertinent question just asked by the hon. Member for York Central (Hugh Bayley). Can the Minister give us any indication of where the Government, at this stage of their Administration, are on the proposed cancer drugs fund, particularly with reference to the drugs used for kidney cancer treatment, which NICE is still evaluating? Can these drugs be issued under the interim cancer drugs fund, not least given the terrible delays some patients face with the local PCTs, when by the time things are resolved it is sometimes, sadly, too late?

[Mr Burns]

May I reassure the right hon. Gentleman that we will shortly consult on the cancer drugs fund. On the question of Afinitor, in which I know he has a particular interest, I appreciate that there has been some concern expressed by families and patients about the issuing of the interim guidance. I would like to emphasise that the guidance is only interim, that the appraisal is ongoing and that we await the final guidance from NICE. I hope that he will be reassured that, since the publication of the draft guidance, the manufacturer of Afinitor has proposed a revised patient access scheme for the drug, which is now being considered as part of the NICE appraisal. In the light of that, we will have to await the announcement of the final decision.

[Mr John Baron (Basildon and Billericay) (Con)]

13. What recent representations he has received on the proposed one-year cancer survival measure.

[The Minister of State, Department of Health (Mr Paul Burstow)]

I have received many helpful representations on the proposed one-year survival measure, including his own when I met him along with a number of leading cancer charities in July. We have launched a full public consultation to shape the first ever outcomes framework for the NHS, and I urge all interested parties to contribute. The consultation document has put forward a range of possible outcome measures, including a one-year cancer survival rate that could be included in the framework. A full response to the consultation will be provided when it closes on 11 October.

[Mr Baron]

The one-year cancer survival measure is welcome, because it will encourage earlier diagnosis. As the Minister will know, however, under-treatment of the elderly in the NHS remains a pressing problem, which was highlighted in a recent report on cancer inequalities by the all-party parliamentary group on cancer. Can he assure us that the over-75s will not be excluded from the one-year or the five-year cancer survival measures once they are constructed?

[Mr Burstow]

The hon. Gentleman makes an important point. It is essential for us to ensure that the NHS delivers treatments that are both based on evidence and age-appropriate, which means ensuring that older people receive treatments that will enable them to survive cancers. His representations will need to be taken fully into account as we consider the results of the consultation on the outcomes framework.

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

Has the Minister seen today’s report from Cancer Research UK? It suggests that many primary care trusts and hospitals focus on drug therapy, and that radiotherapy—particularly targeted and image-guided radiotherapy—is often not given enough priority. Can the Minister assure us that, when considering cancer drugs expenditure, he will give equal priority to radiotherapy treatment?

[Mr Burstow]

The hon. Gentleman’s question is also relevant to surgery, but Cancer Research UK was right to produce this snapshot of the lamentable record of the last Government on access to radiotherapy. Spending on the NHS has now reached European levels, but we have not seen an equivalent achievement in terms of outcomes. That is why the present Government have been consulting on outcomes, and why we have asked Mike Richards, clinical director for cancer services, to examine these very issues in his review of the cancer reform strategy.

[Gordon Birtwistle (Burnley) (LD)]

14. What steps his Department takes to ensure that local NHS trusts observe its guidelines on reconfigurations involving transfer of facilities from one hospital to another.

[The Secretary of State for Health (Mr Andrew Lansley)]

Commissioners should ensure that current and future reconfigurations demonstrate evidence of compliance with the four criteria that I announced in May. That should be a rigorous process, involving GPs and other local clinicians, local authorities, patients and the public, as set out in guidance. For current schemes, the local assessment should be concluded by 31 October this year.

[Gordon Birtwistle]

Is my right hon. Friend aware that East Lancashire Hospitals NHS Trust is breaching his guidelines by transferring a children’s ward from Burnley to Blackburn without the approval of local GPs and the local council or the support of the local population? Will he please intervene?

[Mr Lansley]

My hon. Friend and I have had a conversation in Burnley about emergency and children’s services at Burnley hospital. I was not aware of the position that he has just described, but I will ensure that any reconfigurations that have taken place in the past and are still being reviewed, or that are currently being proposed or acted on, comply with the criteria that I set out in May, and I will write to him.

[Anna Soubry (Broxtowe) (Con)]

15. What mechanisms are in place to assess the effectiveness of assertive outreach teams in providing support for people with severe mental illness; and if he will make a statement.

[The Minister of State, Department of Health (Mr Paul Burstow)]

The Department of Health has issued guidance on the key components of an effective assertive outreach team. It is for each local trust to put in place robust quality assurance arrangements to ensure that it delivers the high-quality and effective service that the public expect. That is further underpinned by the work of the Care Quality Commission.

[Anna Soubry]

I am grateful to the Minister for his response. One of my constituents, William Barnard, who was profoundly mentally ill, went on to kill his grandfather as a result of the poor system that was operating in relation to his care. What progress has been made in ensuring that other teams do not suffer from the same failings in their systems?

[Mr Burstow]

The hon. Lady and I debated this issue in the Chamber back in July. One of the most concerning aspects of the case of William Barnard was a singular failure to listen to the concerns expressed by family members and carers on the part of those who could have taken the necessary action to improve matters. I continue to take a close interest in the investigations being undertaken by the local NHS. We want to ensure that when lessons can be learned nationally, they are reflected in the Government’s forthcoming mental health policies.

[Miss Anne Begg (Aberdeen South) (Lab)]

Have the Minister or others in his Department had any discussions with the Department for Work and Pensions, because in the coming months a large number of people with mental health problems will be called in for interview to be reassessed from incapacity benefit on to employment and support allowance? This is already causing a great deal of anxiety among my constituents because Aberdeen is one of the trial areas. I wonder whether any of the mental health professionals have been informed and are ready for the influx that might result from that change in policy.

[Mr Burstow]

There are several parts to that question. First, we have already made commitments to invest in talking therapies, which are improving hugely the quality of lives of many people with mental health conditions. Secondly, I and departmental officials have had meetings with colleagues in the DWP, and I will have further meetings shortly, particularly to discuss the DWP input into a cross-Government mental health strategy.

[Andrea Leadsom (South Northamptonshire) (Con)]

16. What recent representations he has received on requirements for doctors to record the primary cause of death on a death certificate.

[The Parliamentary Under-Secretary of State for Health (Anne Milton)]

I am not aware of any such representations. Doctors are required under the Births and Deaths Registration Act 1953 to complete the medical certificate of cause of death “to the best” of their “knowledge and belief”. They receive information on this as part of their medical training. The Office for National Statistics produces reference material from time to time, including a video and training pack to assist doctors in completing the medical certificate on cause of death.

[Andrea Leadsom]

I thank the Minister for that answer. We have in my constituency of South Northamptonshire the Progressive Supranuclear Palsy Association headquarters. That is a neuro-degenerative disease with some similarities to motor neurone disease, although the big difference is that I doubt that many Members will have heard of it before now. Many people suffer from it, however, yet it is often not recorded on the death certificate. It is always fatal, giving a life expectancy of about two years. Might the Minister be prepared to review the situation and give some consideration to requiring doctors to put the primary cause of death on the death certificate so that we can properly assess the magnitude of this awful degenerative disease?

[Anne Milton]

I thank my hon. Friend for raising this issue. As a result of inquiries from the Progressive Supranuclear Palsy Association and others, the ONS is carrying out a special exercise to attempt to identify the true number of deaths involving PSP. However, it is extremely difficult to diagnose. I should just point out that medical examiners, when appointed, will be confirming the cause of death in all cases not investigated by the coroner. I think that that will make a difference to the information recorded on death certificates.

[Caroline Flint (Don Valley) (Lab)]

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

[The Secretary of State for Health (Mr Andrew Lansley)]

My responsibility is to lead the national health service in delivering improved heath outcomes in England, to lead a public health service that improves the health of the nation and reduces health inequalities, and to lead the reform of adult social care that supports and protects vulnerable people.

[Caroline Flint]

In recent years more research and evidence has demonstrated that the trans fats present in our food are a major heath hazard. That is how the National Institute for Health and Clinical Excellence has described them, and the World Health Organisation has described them as toxic, but many people do not even know they are in our foods because they are not listed on the front of our food packaging. Is the Secretary of State prepared to consider banning trans fats in our food, as is happening in other countries around the world, or at the very least consider making sure they are labelled on the products we buy so that we can make an informed choice?

[Mr Lansley]

The right hon. Lady will know that we have made progress in this country in reducing the amount of trans fats in foods. My personal view is that we should seek to eliminate them, rather than have them in foods and have them labelled. It is important that we have front-of-pack food labelling that identifies the extent to which there are saturated fats, and I am looking forward to making greater progress in getting a more consistent front-of-pack food labelling than we have achieved in the past.

[Tony Baldry (Banbury) (Con)]

T2. GPs and GP practice managers in my constituency are keen to get on with GP commissioning because they see that that can lead to better outcomes for local people but, unsurprisingly, they have a number of detailed questions as to how GP commissioning will work. Who will best answer those questions, and when will that happen?

[Mr Lansley]

My ministerial colleagues, and many other leadership colleagues across the NHS, are engaged in meeting staff and potential commissioners, and existing commissioners and patients and public across the country. I had a meeting of that kind in Hampshire just last week, which illustrated precisely the point my hon. Friend makes: people came from general practices across Hampshire, and they fully endorse the principle of this change and they just want to get on with it. They did not want to wait for the full transition, and they now wanted to go through some of the detailed questions. We issued a consultation document following the White Paper, which was focused on general practice commissioning. I urge my hon. Friend’s constituents and others to respond to that before 11 October, which will enable us then to proceed to set out the full details of how general practice-led commissioning will work.

[Mary Creagh (Wakefield) (Lab)]

The Secretary of State had a difficult summer, with his plans to scrap free milk for the under-fives being attacked across the spectrum and eventually vetoed by the Prime Minister, but he met the new chair of Unilever, Amanda Sourry, on 21 July. On the following day, Ms Sourry wrote him a letter, some of which is blanked out. She wrote that

“with a clear signal from you, I would be happy to engage with retailers and manufacturers to find resolution on front-of-pack labelling”.

The Department has tried to black out that sentence, perhaps because it shows an unhealthy closeness between the Secretary of State and Unilever. Does the Secretary of State have an opinion on how food should be labelled, and, if so, will he tell the House what it is? Will he tell the House what other areas of food policy he plans to subcontract out to multinational food giants?

[Mr Lansley]

I hardly know where to begin due to the absurdity of some of the assertions in that question. How does the hon. Lady imagine that we are going to make progress on front-of-pack food labelling, on which her Government never made sufficient progress—there is no consistency on front-of-pack food labelling? This Government and this Parliament have no unilateral power to mandate what front-of-pack food labelling should look like and we have to achieve consensus in Europe and consensus in this country. We must do that with the manufacturers, the retailers, the charities and the health experts. That is precisely why our public health commission, when we were in opposition, brought together all those people around a table for the first time. I intend to create a realistic and effective partnership to deliver improving public health in this country, where her Government failed.

[Mr Philip Hollobone (Kettering) (Con)]

T5. Kettering general is a wonderful hospital but recently its paperwork has got out of control. Some 30 occasional chaplaincy visitors from the local Catholic Church, many of whom are retired, have recently had to complete Criminal Records Bureau checks, employer references and an intrusive personal health questionnaire. Does the Minister agree that if we are to create the big society that the Prime Minister would like us to create, such bureaucracy must be minimised?

[The Minister of State, Department of Health (Mr Simon Burns)]

I have considerable sympathy with the problems that my hon. Friend’s constituents had. Although they are necessary, I would like to think that vital checks could happen through a process that is easy to manage for those who have to go through them. My view is that hospitals must ensure that checks on volunteers are proportionate and do not discourage good and well-meaning people from becoming involved in local care. I hope that my hon. Friend is reassured by the fact that my right hon. Friend the Home Secretary announced on 15 June that the CRB regime would be scaled back to common-sense levels. The Government will announce the terms of reference of the review shortly.

[Keith Vaz (Leicester East) (Lab)]

T3. Some 1,800 patients in the Belgrave area of my constituency have been left without their local surgery because it has closed. Will the Minister assure me that despite the scrapping of the primary care trust, the new Belgrave health centre will be built? If he cannot tell me now, it would be very helpful if he could write to me.

[Mr Lansley]

I am grateful to the right hon. Gentleman, but in the absence of notice of that question, I fear that I shall have to tell him that I shall certainly look into that and write to him.

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

T6. The Minister of State wrote to me on 25 August to say that all future service changes must be led by clinicians and patients. How can it be that, although all the clinicians and patients oppose the downgrading and possible closure of the Ryedale ward of Malton hospital, that can proceed? Will he please use his good offices to block any such change?

[Mr Burns]

I am very grateful to my hon. Friend and would like to tell her that I have been informed by NHS Yorkshire and the Humber that NHS North Yorkshire and York has proposed incrementally to alter the balance between resources in the community and the in-patient areas by slowly reducing the number of beds open for admission and slowly transferring staff into the community. We understand that that forms part of the PCT’s ongoing strategic plan for Malton. However, given my hon. Friend’s concerns, I would be more than happy to meet her to discuss the issue further.

[Gloria De Piero (Ashfield) (Lab)]

T4. When the Government say that the NHS budget will be ring-fenced, people might assume that whatever cash a hospital gets in this financial year will be matched next financial year. So could the Health Secretary explain why the King’s Mill hospital in my constituency has been told to expect its budget to treat patients next year to fall by 8.2% or £14.9 million?

[Mr Lansley]

The answer to the hon. Lady’s question is probably because that is what the Labour Government’s spending intentions implied. All over the country primary care trusts are telling their hospitals that they can expect a zero increase in tariff and a reduction in activity, and hence a reduction in budget. I am making it clear that we are intending an historic commitment by this coalition Government to increase the resources for the NHS in real terms. That does not mean an increase in real terms for every part of the NHS all the time. It does mean, however, that resources will be realised through efficiency savings and that increase to enable us to improve the service we provide through the NHS and to meet rising demand.

[Mr John Baron (Basildon and Billericay) (Con)]

T8. Is any flexibility available to allow the interim cancer drug fund to review earlier and more speedily adverse National Institute for Health and Clinical Excellence decisions—because in certain cases, as we know with Avastin for late-stage bowel cancer, a few months, or even a few weeks, can make a big difference to patients.

[Mr Lansley]

My hon. Friend will be aware that we have proceeded as rapidly as we possibly can in finding savings this year, so that from 1 October the regional panels of expert clinicians can look at individual cases. It is not a matter of their reviewing NICE decisions; it is a matter of their looking at individual cases that cannot be funded under existing guidance or local decisions, but being able to apply clinical criteria to individual cases using an additional fund.

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

T7. Wolverhampton is the 28th most deprived local authority area in the country, resulting in major health inequalities. Can the Secretary of State reassure me that in future funding allocations, levels of deprivation will be taken into account?

[Mr Lansley]

Yes and more than that. I could make it clear that in the future, we will be moving—not for next year necessarily, but in years beyond, as we will make clear in the public health White Paper—to an explicit allocation of public health resources taking account of relative health outcomes and health inequalities, and those funds will be used to deliver improving public health. At the moment the formula to the NHS may take account of relative deprivation as measured by, for example, access to income support, but the money does not get spent on reducing those health inequalities and on an effective public health strategy. That is why we shall be very clear about separate, ring-fenced, public health resources used, together with local authorities, to deliver an effective public health strategy locally.

[Andrew Selous (South West Bedfordshire) (Con)]

Leighton Buzzard is one of the larger towns in the country not to have a community hospital. What reassurance can my hon. Friend give me that the wishes of local GPs will be respected in deciding what services the proposed community hospital will have?

[Mr Burns]

I think I am in the fortunate position of being able to give my hon. Friend considerable reassurance. NHS Bedfordshire has the full support of local GPs, and they continue to develop a business case for the primary health care facility in Leighton Buzzard. They will go to full public consultation on the proposals. The centre is planned to open in 2012 and would be funded by NHS Bedfordshire.

[John Mann (Bassetlaw) (Lab)]

Some 36,000 of my constituents, who voted by ballot, and every single GP in both local authorities, all believe that Bassetlaw accident and emergency department should remain a full 24-hour service. Can the Secretary of State conceive of any reason why that might not be the case during this Parliament?

[Mr Lansley]

The hon. Gentleman will be reassured to recognise that one of the commitments of the coalition Government in our programme was to stop the forced closure of accident and emergency departments. I am sure he will take comfort from the commitment of this Government, and from our commitment to increasing resources for the NHS in real terms each year, to enable the services that his constituents and others’ require to continue to be provided and improved.

[Jo Swinson (East Dunbartonshire) (LD)]

Information in a parliamentary answer given on 19 July showed that the cost to the NHS of emergency admissions in cases of anaphylaxis has risen by 45% in four years. Will the Minister look at how allergy support services could be enhanced in primary care to reverse the rising trend in emergency cases and in doing so save money and, crucially, lives?

[Mr Lansley]

Yes I will gladly do that. I have had the privilege and pleasure of visiting the specialist allergy service at my local hospital, Addenbrooke’s, one of a small number across the country. I think it was the House of Lords Select Committee that produced an excellent report on allergy services, and I hope that this is one of those areas where clinical relationships between GPs and hospital specialists will enable both community and specialist services to be improved to meet this need.

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

Given that 50% of health inequalities are created by tobacco use, will the Secretary of State give us an assurance that the targeted smoking cessation programmes in the national health service will survive?

[Mr Lansley]

We are going to improve the effectiveness of our public health services. As the right hon. Gentleman will know from past debates, I entirely recognise the extreme importance of reducing tobacco use. After the introduction of legislation on smoking in public places, there was a reduction in prevalence, but at the moment there is no continuing further reduction, especially among manual workers and young people; we need to achieve that reduction, and we will continue to look at measures to do that. We will say more about the issue in our public health White Paper.

[Mr Steve Brine (Winchester) (Con)]

Many of my constituents, and indeed many practitioners, have grave concerns about the pending closure of Winchester ambulance station. Will the Minister assure the House that no changes to static ambulance bases will take place until local consortiums, when they are formed, are happy that a suitable alternative is in place?

[Mr Burns]

I am extremely pleased to be able to give my hon. Friend some reassurance. South Central strategic health authority has informed me that the service to the people of Winchester will not be affected, as there will be static provision for Winchester; ambulances will be deployed via a control centre in Otterbourne, 2 miles from Winchester. Those changes are set to take place in December, and the existing station will not be closed until there is new provision.

[Mr David Lammy (Tottenham) (Lab)]

A decision has been taken in the past few days, without any consultation at all, to transfer the out-of-hours service for 950,000 north Londoners from the GP-run co-operative to a private provider. Will the Secretary of State intervene to ensure that local people and GPs make that determination?

[Mr Lansley]

I am aware of the matter. The right hon. Gentleman will be perfectly well aware of my view: we want to involve general practitioners much more in commissioning out-of-hours services. I will undertake to look at what is proposed by the primary care trusts in north London and see whether it is consistent with the development that we are looking for in the White Paper.

[Mrs Helen Grant (Maidstone and The Weald) (Con)]

If local GPs fail to support reconfiguration plans en masse—if, say, 97% fail to do so—what would be the Secretary of State’s response?

[Mr Lansley]

As I said in response to a previous question, one of the four criteria that I set out on 21 May was that reconfigurations must have the support of local general practitioners as the future commissioners of services. To that extent, a reconfiguration that did not have the support of local general practices would not be able to meet that test.

[Ian Paisley (North Antrim) (DUP)]

What discussions, if any, has the Secretary of State had with the Minister for Health, Social Services and Public Safety in Northern Ireland about making Avastin and other specialist cancer drugs available on the same terms and conditions under which they are available to people who suffer from cancer here on the mainland? Will those drugs be made available in Northern Ireland under the same terms and conditions?

[Mr Lansley]

I have had very helpful and productive conversations with the Health Minister in Northern Ireland, but I have to say that they did not include that particular subject. Of course, decisions on the availability of medicines in Northern Ireland are a devolved matter, but I should be perfectly happy to take account of those issues when we next talk.

[Dr Sarah Wollaston (Totnes) (Con)]

One year on from the implementation of the European working time directive, there is evidence that patient care is suffering. Handovers have been inadequate in some cases, and junior doctors’ training time has been reduced. Will my right hon. Friend reassure me that he will take action to allow some acute specialities to opt out of the European working time directive?

[Mr Lansley]

Yes. I am very clear that, together with my right hon. Friend the Secretary of State for Business, Innovation and Skills, we need to take the European working time directive back to the European Union. We need to discuss it again. We need to go to the European Union with the intention of maintaining the opt-out and of giving ourselves, not least in the health context, the flexibility that we lack, so that junior doctors, in particular, have the capacity to undertake the training that they need. It is not that we want to go back to the past, when there were excessive hours—100-hour weeks and so on—but we want junior doctors to be confident that they will get the training that they require in the period allocated for training.

Audit Commission

Tuesday 7th September 2010 Commons Chamber

15:34

[Mr Clive Betts (Sheffield South East) (Lab)]

(Urgent Question): To ask the Secretary of State for Communities and Local Government if he will make a statement on his intention to abolish the Audit Commission.

[The Secretary of State for Communities and Local Government (Mr Eric Pickles)]

On 13 August, I announced plans to disband the Audit Commission and to refocus audit on helping local people to hold councils and local public bodies to account for local spending decisions. Those changes will pass power down to people, replace bureaucratic accountability with democratic accountability and save the taxpayer £50 million a year.

Earlier that day, I spoke to the commission’s chairman, Michael O’Higgins, informing him of my decision. I also informed him that I intended to invite Lord Adebowale of Thornes and Bharat Shah to serve a second term as members of the commission. As we have announced today, I am pleased to confirm that they have agreed to continue to serve, with Bharat Shah as deputy chairman. As I have also announced today, further commissioners will be recruited to the board through open competition to bring in new private sector expertise, as the commission focuses on the changes that I have announced.

These changes mean that the commission’s responsibilities for overseeing and delivering local audits stop. Its research activities will end. Its in-house audit practice will be moved to the private sector, and we will consider a range of options for doing that. Councils will be free to appoint their own independent external auditors from a more competitive and open market. There will be new audit arrangements for local health bodies. All local audits will be regulated within a statutory framework, overseen by the National Audit Office and the profession.

With the ending of the inspection regime of comprehensive area assessment, many of the Audit Commission’s functions have disappeared. While its corporate centre may have lost its way, the well-respected in-house audit practice has consistently done a good job, and it is to protect the future and to increase competition in auditing that we seek to put it into the private sector. The Government are happy to see a mutual set up by existing staff. My intention is that those arrangements will be in place from 2012-13, which involves introducing legislation this Session.

We will now work closely with local government, the health sector, the commission, the accounting profession and other partners to complete the detailed design of the new arrangements, and to take forward, in the most effective way, the transfer of the commission’s in-house audit practice to the private sector.

[Mr Betts]

I thank the Secretary of State for his response, but I am not sure that I am any clearer about the precise reasons for his decision. First, may I ask why it was necessary to announce this decision in the middle of the recess, rather than coming to the House and making a statement? There did not seem to be any particular time imperative. Will he place in the Library of the House all the detailed papers that he must have gone through showing how he came to his decision? Presumably it was not a rushed one, or a knee-jerk reaction.

As for the annual audit function, does the Secretary of State believe that the private sector has the capacity to carry it out at the same cost as the district audit service? If business is transferred to the private sector, will there be a return to the public purse? Value-for-money studies are not, as he tried to make out, some attempt to dictate to local authorities, but an important way of making comparisons between authorities, which are useful to the authorities and to the electorate in holding them to account. Who will undertake those studies in future? Finally, if the Secretary of State really believes in localism, why did he not consult local councils and the Local Government Association before announcing his decision?

[Mr Pickles]

I am grateful for the hon. Gentleman’s questions and, indeed, I look forward eagerly to meeting him and his Committee next Monday to go through this in a more discursive way.

Of course I think there is plenty of capacity to deal with this. After all, the Audit Commission is the fifth-largest accounting practice in the country. The hon. Gentleman will readily understand that the Audit Commission was thinking along identical lines, and had already begun to engage in discussions with some of the larger practices regarding a potential sale, long before I talked to the chairman.

Do I think that going to private practice will operate at the same level of audit fees as currently? The answer is no. I expect it to be a lot cheaper. After all, audit fees have doubled in the past 13 years. With regard to the value-for-money practices and services, in the past the Audit Commission performed a very useful function. When it started out, it was virtually alone in doing that, but now there are many organisations providing those services, not least the National Audit Office. We should not be duplicating such reports.

[Mr Edward Leigh (Gainsborough) (Con)]

I welcome the announcement. One of the problems with the Audit Commission, as opposed to the National Audit Office, is that it did not have a dedicated Committee in this place to which it could report—namely, the Public Accounts Committee. Presumably, this will now change. Can my right hon. Friend reassure me that with regard to local government and other matters covered by the Audit Commission, such as what goes on in hospital wards, the value-for-money work can now be taken up by the National Audit Office through the Public Accounts Committee and reported to the House?

[Mr Pickles]

The short answer is yes, and I thank my hon. Friend for that contribution. The House should celebrate the rigour that the National Audit Office has brought to the study of value for money, the work that it has done to offer good practice, and its accountability to the House. What the coalition Government have done will increase accountability to the House.

[Margaret Hodge (Barking) (Lab)]

I share with others the concern that the Minister felt he could make such an extremely important announcement in the middle of recess, without making it to the House. I understand that he wishes the National Audit Office to have a new role, but does he understand that the National Audit Office is not a Department of Government but is accountable to Parliament, and that it is staffed not by civil servants but by officers of the Crown? In that context, is he aware that he cannot instruct the National Audit Office to play any particular role in this instance? Will he undertake to have proper consultations—I do not think my Committee has even had a letter from him—both with the Public Accounts Commission and with my Committee before he makes any other proposals, to ensure that these proposals are workable and bring to proper public account the massive expenditure and many programmes from local government?

[Mr Pickles]

I am sure it was a slip of the tongue by the right hon. Lady when she said that she had received no communication from me. She was one of the first people to whom I wrote—

[Margaret Hodge]

I have not had a letter.

[Mr Pickles]

I am amazed at that. I will send the right hon. Lady a copy. I assure her that I was at great pains to write to her, and I spoke to her principal officer to ensure that she would be briefed on the matter, so I am very surprised at that and will seek to speak to her immediately after this urgent question.

I apologise to the hon. Member for Sheffield South East (Mr Betts) for not dealing with why the announcement had to be made during recess. The simple truth is that we needed to appoint a number of commissioners. Had I appointed a commissioner on a short-term basis, it would have been obvious what was happening and that would have led to all kinds of speculation. I appointed just a sufficient number of commissioners at the end of August to ensure that the commission would remain quorate and that we would have an opportunity of appointing some commissioners with experience of transferring such a valuable asset to the private sector.

[Margot James (Stourbridge) (Con)]

As the Secretary of State knows, the Audit Commission appointed ConnectPR to lobby parliamentary candidates, MPs and Ministers in the last Parliament. What is his Department doing to end the scandal of Government agencies that are supposed to be independent using public money to lobby other arms of Government in that way?

[Mr Pickles]

I share my hon. Friend’s concerns about that. At a time when money and resources are short, it is clearly inappropriate for public bodies to use public money to lobby other public bodies. Indeed, my Department has issued instructions to all our bodies, including arm’s length bodies, to cancel all existing contracts with lobbyists, and we will shortly issue guidance to public bodies on the use of lobbyists.

[Mr John Denham (Southampton, Itchen) (Lab)]

Over the past 15 years, is it not true that the efficiency and effectiveness of local government improved significantly? By 2008, four out of five top-tier councils were rated in the top two performance categories. Councils were making £5.5 billion of efficiency savings in the current spending period, and the Commonwealth Fund recently judged the national health service to be the most efficient health care system among industrialised countries.

Is it not the case that the independent Audit Commission played a significant role in achieving those improvements? Why was the decision to abolish the commission taken in secrecy? It was not in the coalition agreement or in the published work plan of the right hon. Gentleman’s Department. Why did it have to be rushed out without consultation? Will the Secretary of State apologise for briefing that the commission was spending money on trips to the races, when he knew that it hired a meeting room on a non-race day? Why did he hide behind tabloid headlines that he knew were wrong?

When the noble Lord Heseltine set up the Audit Commission, he said that

“because local authorities appoint their own auditors, audit is not seen to be obviously independent of local government.”—[Official Report, 18 January 1982; Vol. 16, c. 53.]

Was not the noble Lord right? Are not the Government recreating between local councils and auditors the cosy, incestuous relationships that also failed Enron and, more recently, the banking system?

The Audit Commission was increasingly looking at whether local services as a whole were working together to provide quality and cost-effective services, and letting the public compare the value for money that taxpayers receive from area to area. Is it not true that the Secretary of State stopped that work because he wants to see unjustified variations in service quality and an unfair postcode lottery?

The Conservatives said at the election that the independent Audit Commission would judge whether changes to local government finance were fair. Has not the right hon. Gentleman now abolished that body so that he can make changes without any effective scrutiny?

The Audit Commission was not perfect. I too blocked the appointment of an unduly highly paid chief executive, but is the Secretary of State not destroying one of the tools for challenge and improvement? It was the Audit Commission to which I could turn to investigate the boomerang bosses who walk out with big pay-offs and go into new jobs. It was the Audit Commission that advised first me and then him on the action to be taken with Doncaster city council. The House might share my fears that this move will end up costing local taxpayers far more than it will save.

[Mr Pickles]

The right hon. Gentleman seems to have changed his tune slightly, because at the time of the announcement he said:

“I…warned the Audit Commission against excessive wage increases and their fate seemed to be sealed when they ignored this”.

The right hon. Gentleman refers to the use of Newmarket race course. I am not concerned that the Audit Commission spent £40,000 on pot plants, £8,000 on a conference at that race course or £4,600 on bagels. Nor am I worried that it spent £6,000 to celebrate its 25th anniversary at the Reform club, £3,000 on fine dining at Shepherd’s or £170,000 on role-playing and training for its staff. The commission might have made a number of mistakes and errors of judgment, but this measure is about saving the audit function.

The Audit Commission itself recognised that it was working on identical sets of proposals, because it recognised that the future of audit was in the private sector. John Seddon, a visiting professor at Cardiff university business school, recently described the commission as

“an instrument of the regime…The regime has fostered compliance rather than innovation, and compliance with wrong-headed ideas to boot.”

It was once a great organisation, and it did make a change to local government. However, local government has changed itself and it is time to move on. No doubt the right hon. Gentleman will spend some considerable time living on past glories, but the Audit Commission cannot do that. It is time to pass the baton to the National Audit Office for the supervision of the process, and it is massively important to ensure that audit remains rigorous.

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

I hold no brief for the present regime, but will the Secretary of State explain the mechanism under the new arrangements whereby local communities will be able to tell on an annual basis whether their council is good value for money? If an individual or company wants to bring a particular query to the attention of auditors and get a quick reply, will they be able to do that, so that there is relevance both politically and economically?

[Mr Pickles]

The hon. Gentleman has a long and distinguished record of supporting localism. What we are doing passes the power to local people. We will ensure that a rigorous auditor is appointed and that there is rotation of auditors so that no cosy relations are built up. Auditors will have a responsibility for public probity and if a member of the public is unhappy about how their council is operating and has reason to believe that what it is doing is financially inappropriate, they will be able to report that directly. In addition to that, we will ensure that the ombudsman’s powers are increased and made legally binding.

[Barry Gardiner (Brent North) (Lab)]

The Secretary of State has said that he expects the costs to the public purse to go down as a result of abolition. Will he undertake to publish each year the actual costs of the arrangements with the private sector? Will he also ensure that there is a method whereby constituents can see comparability across the audits conducted for each area?

[Mr Pickles]

I am delighted to tell the hon. Gentleman that I can do better than that. We will ensure that all local authorities—and, indeed, my Department—will publish every single item of expenditure over and above £500. Members of the public will have a very clear idea where their money is being spent. That is not in any way meant to replace the auditing function. The cost of the auditing function will be made available to the public. There will be no hiding place for the Government; £50 million a year—at a Conservative estimate, if you’ll pardon the pun—will be saved for the public.

[Brandon Lewis (Great Yarmouth) (Con)]

I welcome this decision and, like councillors across the country, I suspect, I am looking forward to one of the benefits. We are all here to represent residents, and councils are there to serve them. Am I right in thinking that one of the key benefits for residents, thanks to this measure, is that councils will be able to move forward and make decisions based on what their residents want and need, rather than just ticking a box for the Audit Commission, which leads to unpopular decisions such as fortnightly waste collections?

[Mr Pickles]

My hon. Friend makes a valid point about fortnightly waste collections. He is not alone in this; he will be delighted to know that he is in the company of the former Mayor of London, Ken Livingstone, who has welcomed the abolition of the Audit Commission. He said:

“This is one Tory cut I support”.

I am sure that we are all with him on that—although it is, of course, a coalition cut, not a Tory cut.

My hon. Friend has mentioned a prime example of the Audit Commission being keen to please the Government rather than perform its functions. When the Government were clear that they wanted fortnightly collections, it went out of its way to push local authorities in that direction. My hon. Friend is right: this measure means more power to local people.

[Fiona Mactaggart (Slough) (Lab)]

After the implementation of this decision, what will happen to the rigorous but usually free audit support that the Audit Commission gives to small parish councils?

[Mr Pickles]

Given that 30% of all audit functions in public bodies are now in the private sector, I suspect that it will make no difference.

[Bob Blackman (Harrow East) (Con)]

I am very pleased to hear the Secretary of State’s announcement. I am also pleased to hear that these contracts will be rotated. However, one of the things we will all want to see is vigour in the process and expertise built up. What regulation or guidance will be issued on the length of contracts to ensure not only that a cosy arrangement does not grow up between auditors, but that expertise can be built up to speed up the process and reduce costs?

[Mr Pickles]

My hon. Friend is quite right to wish to ensure that there is a rigorous regime. He is also right to warn about the consequences of auditors remaining within a particular local authority for too long; it is always important to have a fresh eye. We will be looking to the National Audit Office and the professions to build up a very rigorous regime that will last and will pass the test of time.

[Jon Trickett (Hemsworth) (Lab)]

The guarantee of probity is one of the central functions of the audit, and achieving that requires independence. One remembers very clearly the role of the Audit Commission in the political corruption at Westminster council, which revealed millions of pounds effectively being taken away from the public—the ratepayers—there.

May I draw to the House’s attention the remarkable coincidence that the day on which this announcement was made—13 August—was the same day that Sir Philip Green was appointed the Government’s efficiency tsar? Was there any connection between the two announcements? Can the Secretary of State give the House an assurance that Sir Philip Green, given his tax arrangements, will play no role whatsoever in guaranteeing probity in public expenditure?

[Mr Pickles]

I have known the hon. Gentleman for a long time, so I am genuinely sorry to do this to him, but may I politely remind him that the auditor in Westminster was a private sector auditor working for KPMG? It was not a district auditor—it was somebody in the private sector.

With regard to any outside organisations dealing with these matters, we are looking to the National Audit Office and the professions.

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

May I congratulate my right hon. Friend on doing this and on the speed with which he is carrying it out? I think it will be welcome right across the public sector. Does he agree that the problem with the Audit Commission has been one of function, structure and, I am afraid, on occasion, questionable leadership? Will he distinguish that from the excellent audit function that many who work at the coal face in the commission carry out and will presumably continue to carry out under different managerial structures?

[Mr Pickles]

I am very glad to make that distinction. There was an element within a part of the Audit Commission that was about press releases, sucking up to Government and being part of the latest fad. That never percolated to the audit function, which has always upheld a very high standard. While we will pursue all options, I certainly hope that the workers within the Audit Commission get the opportunity to be able to set up a co-operative. We are keen to see that it is not the bosses of the Audit Commission who benefit from this but the workers.

[Sir Peter Soulsby (Leicester South) (Lab)]

May I remind the Secretary of State that the auditor for Westminster was appointed and supported by the Audit Commission? What assurance can he give us that the rigour that was shown by that auditor will be repeated in future when auditors are appointed and chosen by local authorities themselves, inevitably leading to cosy relationships?

[Mr Pickles]

I note that the hon. Gentleman has conceded the point, although a little reluctantly and perhaps not with the greatest grace, that the auditor was a private sector auditor. That clearly demonstrates that the private sector can be trusted as auditors. The majority of those dealing with industry are private sector auditors, and that is the best guarantee of probity. We will ensure that the National Audit Office and the professions oversee this. There is a distinction, and it is this: we trust local authorities; Labour Members clearly do not.

[James Morris (Halesowen and Rowley Regis) (Con)]

Does the Secretary of State agree that under the previous Government, the Audit Commission became increasingly an agent of central control? The decision that he has rightly made sends a very important signal that this coalition Government have confidence in local government and in driving through a decentralisation agenda. That is why I welcome his decision—it is the beginning of a decentralisation path that I wholly support.

[Mr Pickles]

I am most grateful to my hon. Friend for his support, and he is quite right. That is one reason why I believe the Audit Commission, despite all its defects, recognised that the time had come to acknowledge that the fifth-largest auditing function in the country would be better, safer and regulated more safely in the private sector.

Pakistan Floods

Tuesday 7th September 2010 Commons Chamber

16:01

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

With permission, Mr Speaker, I would like to make a statement about the floods in Pakistan. I am sure that Members of all parties will wish to express their profound sadness at the terrible suffering and devastation that the catastrophe has caused. Our thoughts are with all those families, both in Pakistan and here, whose lives have been touched by this terrible natural disaster.

It is now nearly a month since the devastating floods hit Pakistan, and it is almost impossible to describe the magnitude of what has happened. Ten years’ equivalent of rainfall fell in one week, and subsequently a wall of water has travelled 1,200 miles down the country. Some 12.5 million people are in need of immediate assistance and 1.2 million homes have been damaged or destroyed. More than 1 million head of livestock have been lost and 3.5 million hectares of standing crops damaged or lost. The estimated cost to Pakistan’s economy this year alone is $4 billion.

Britain will continue to do everything we can to help. I am particularly concerned about the potential for a secondary humanitarian public health crisis due to the slow draining of waters from Sindh province and parts of Punjab, the lack of access to clean water and sanitation facilities, and inadequate health facilities to treat the outbreak of water-borne disease. I have discussed all those concerns on a number of occasions with the United Nations Secretary-General, and he has assured me that the UN, working with partners on the ground, will do all it can to respond to the threat.

I am pleased to be able to say that the UK has been at the forefront of the international community’s response to the disaster and was the first major country to come to Pakistan’s support in significant scale in its hour of need. The Department for International Development has sent 3,500 all-weather tents to provide shelter for up to 10,000 people. More plane loads of aid quickly followed, providing tents, shelter kits, water containers and blankets to help many thousands more affected by the floods. We have drawn upon all resources available to the Government. The Royal Air Force has flown in five plane loads of relief, and I am sure that the whole House will join me in paying tribute to the contribution of our armed forces in this crisis.

Our assistance to date includes help for 500,000 malnourished children and pregnant or breastfeeding women through the provision of high-energy food supplements, treatment for severely malnourished children and the training of health workers. We are providing safe drinking water, sanitation and hygiene for 800,000 people, and have prioritised clean water and health interventions in Punjab and Sindh. Our support is helping to provide hygiene kits for more than 500,000 people and is being channelled through Save the Children, Concern and Oxfam. We are also providing shelter for up to 40,000 households through the Pakistan Red Crescent movement and working closely with Islamic Relief.

In addition, I am pleased to announce the overnight arrival in Karachi, in Pakistan, of the first of three new flights delivering DFID relief goods. It will bring much needed water purification units, pumps and water tanks to assist those in desperate need of clean drinking water. The other two flights will carry a range of items, including water carriers and shelter kits. We are also starting emergency production lines in two factories in Pakistan to produce hygiene kits and water containers that will help stop the spread of water-borne diseases in southern Pakistan, and are helping to set up an emergency field operation and co-ordination base camp near Sukkur to provide a base for relief workers in the middle of the worst flood-affected area.

My Department has also brought forward a bridge rehabilitation programme as part of the recovery effort. The first 10 bridges left Tilbury docks last week and will arrive in Karachi later this month. That assistance will help to open access routes and reduce the pressure on much-needed air assets.

Soon after the flooding started, I travelled to Pakistan with my noble Friend Baroness Warsi to see for myself the devastation. I visited the town of Pir Sabaq in Khyber Pakhtunkhwa province and saw the 12 foot-high watermarks on the remaining walls of the houses. It is not easy to imagine the terror and panic that must have affected particularly older, less mobile people and children as the mountain of water swept through the town. I know that the Deputy Prime Minister’s visit to Pakistan last week made a similarly deep impression on him. During our visits, the Deputy Prime Minister and I discussed the situation with President Zardari and Prime Minister Gilani, as well as with representatives of UN agencies, non-governmental organisations and donors.

Following my visit to Pakistan, I went immediately to attend the UN General Assembly special session on the Pakistan floods, to support the UN Secretary-General’s appeal. The initial response of the international community was woefully inadequate. I used that meeting to encourage other nations to contribute more and announced the doubling of the UK’s contribution to the relief effort to £64 million. We have consistently worked to co-ordinate the effort of the donor community and on the ground with Pakistan’s National Disaster Management Authority, under the experienced leadership of General Nadeem. The Pakistan authorities, the Pakistan Red Crescent Society and local and international agencies, including many brilliant British non-governmental organisations, have worked tirelessly throughout. We will continue to work closely with all partners to ensure that the response is as effective as it can be.

I should like to assure the House that my Department has throughout been committed to transparency and achieving value for money. We have not simply signed a cheque and handed it over. Our contributions to this humanitarian crisis have been based on detailed and rigorous assessments of needs on the ground. We are working night and day to ensure that every penny spent achieves a meaningful output that alleviates the suffering of the victims of this disaster. We have recently put a floods monitor on DFID’s website to enable everyone to see where and how British aid is being spent to help those affected by the floods in Pakistan. All the UK’s humanitarian assistance is provided through impartial agencies or through goods in kind.

I should also like to express my profound gratitude and respect for the unstinting hard work and skill shown by all British Government officials—both in DFID and from across Whitehall—throughout this emergency.

In addition to the UK taxpayer’s contribution, the British people have once again demonstrated their compassion and generosity. I am sure all hon. Members will wish to join me in commending the magnificent response from the British public, who have committed more than £47 million to the Disasters Emergency Committee appeal. We continue to urge people to give, and to give generously, to that appeal.

Our commitment is not just for the current emergency relief phase but also for the long haul. We will remain at Pakistan’s side to help people to rebuild their lives and livelihoods. We will also support the longer-term reconstruction needs, such as schools, health clinics and other essential infrastructure, which are being considered as part of the bilateral aid review of our development programme.

Although the floods have been a terrible tragedy, their aftermath offers a genuine opportunity for Pakistan. It is an opportunity for the international community to come together and provide exceptional support to Pakistan in its hour of need, but equally, the situation offers an unprecedented opportunity for the Government of Pakistan to drive forward a radical economic reform agenda that could make a real difference to the future of the country.

The UK and Pakistan are bound together by bonds of history and family, which underline our support for Pakistan in good times and in bad. The Pakistani diaspora living in Britain ensures that our two countries remain closely linked. This bond will remain strong over the coming months and years, as we work together to help Pakistan to recover from this unprecedented catastrophe.

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

May I thank the Secretary of State for his statement and for the early sight of it? I join him in expressing my deep sympathy for and solidarity with the people of Pakistan in the wake of this terrible flooding. The thoughts of all us are undoubtedly with all those families in Pakistan and their relatives here in the United Kingdom who have been affected by these unprecedented events.

May I, on behalf of the Opposition, also join the right hon. Gentleman in paying tribute to the work of the officials in the Department for International Development, as well, of course, to our armed forces, especially the Royal Air Force, and many other officials across Whitehall, in responding so effectively to this emergency? There is also common ground across this Chamber in paying tribute once again to the incredible generosity of the British people. As the Secretary of State mentioned, the DEC appeal has now raised upwards of £47 million and many outstanding British charities are contributing to the relief effort.

It is nevertheless incumbent on me to ask a number of questions. First, the Secretary of State and the Deputy Prime Minister were right to criticise the response of the international community to this disaster as “woefully inadequate” and far too slow. Will he therefore give us more detail on which specific donors and international organisations he and the Deputy Prime Minister have spoken with over the past few weeks to encourage them to make more generous contributions? Will he also tell us what meetings have taken place at the EU level, and what meetings in particular he has had with Commissioner Georgieva?

Secondly, I thank the Secretary of State for providing us with a detailed list of what the Government aim to fund in the relief effort. He has indicated that he decided to bring forward some projects, including bridge building. That strikes me as a sensible approach, but could he clarify how much of the funding announced comes from sums already earmarked for Pakistan in the DFID budget, and how much of it is new and additional financing?

Thirdly, I join the Secretary of State in expressing concern about the secondary health crisis now emerging. According to the most recent reports, more than 200,000 cases of acute diarrhoea, 260,000 cases of skin disease and more than 200,000 cases of acute respiratory infection have already been reported. Does he believe that the health situation is under control? What further steps will he be taking to help to improve access to clean water and sanitation?

I wish to conclude by raising two final issues. As many in the House will know, there has been a series of concerning revelations over the summer about the Government’s policies on international development. However, I do not think it appropriate to raise those in the context of today’s statement, and I hope that the Secretary of State will do us the courtesy of coming to the House again soon to clarify his position on those matters. Nevertheless, there are two particular matters on which I seek further clarification today, relating specifically to this disaster.

First, as the poor initial response by donors showed, there is a clear need for greater pooled and co-ordinated funding able to be easily and quickly disbursed in disasters such as this—one of the main reasons why we championed the expansion of the UN central emergency response fund. Can the Secretary of State therefore tell us what role CERF has played in responding to this disaster, whether adequate funds were available, and whether or not he intends to increase Britain’s contributions to the fund in future?

Secondly, it is clear that there is a need for continued reform of the global humanitarian system, including the UN, to increase its efficiency and effectiveness in responding to disasters such as the Pakistan floods. Can the Secretary of State therefore tell us whether or not he intends to continue the drive of the previous Government in pushing for global humanitarian reform and investing in a reformed international system, what lessons he believes need to be learned from this particular crisis, and what discussions he plans with the new UN Secretary-General?

The Secretary of State was of course right to point out the common bonds of history, culture and family that unite the UK and Pakistan. We must continue to be resolute in our support for the poor and vulnerable in Pakistan, particularly at this troubling time. Be assured, Mr Speaker, that the Government will have our support on this side of the House in their continued efforts to do so.

[Mr Mitchell]

I thank the right hon. Gentleman for his welcome for the statement and I will try to answer his questions.

First, may I thank him for his comments about the hard work of officials across Whitehall and the brilliant work that is being done by British charities throughout the flooded area? He asked me about the meetings that have taken place. Off the top of my head, I cannot speak for all the meetings that the Deputy Prime Minister has had, but I can tell the right hon. Gentleman that I had a raft of meetings when I was in Pakistan and New York, as well as having numerous phone calls since I got back. I talked to the Finance Minister and the Prime Minister in Pakistan, to all the leading non-governmental organisations, and to the head of the Office for the Co-ordination of Humanitarian Affairs in Islamabad, who has responsibility on the ground for the cluster system. I also had bilateral meetings with Canada, Norway, the United Arab Emirates, Japan, Australia, and with the World Bank, the International Monetary Fund and the European Union while I was in Pakistan. In New York, I had meetings with the UN Secretary-General and John Holmes, and I lobbied hard with the UAE Minister for Foreign Affairs. I also spoke to my opposite number in the United States, Raj Shah, the Pakistani Foreign Minister, the Swedish Development Minister, the Irish Development Minister and Lord Malloch-Brown. I hope, therefore, that the right hon. Gentleman feels that the British Government have used this opportunity to lobby hard and to get across the points on which he and I are agreed.

The right hon. Gentleman asked how much of the funding is new money and how much is coming from existing programmes. I cannot tell him that at the moment. Obviously, we first ensured that we found the money required, and in due course we will see what budget line it will come from.

The right hon. Gentleman next asked whether I am satisfied with the preparations made to tackle the secondary health crisis. He will be aware that the water is draining from Sindh extremely slowly because it is built on clay, and it might be many months before that drainage takes place. He is right to identify water-borne diseases and the dangers from them spreading rapidly through the vulnerable community, particularly among children and older people. All I can say is that we are on the case. I have spoken personally to the Secretary-General about that specific point, and all the money announced by the Deputy Prime Minister when he was in Pakistan last week will go directly to confronting that issue, which the right hon. Gentleman rightly raised.

Finally, the right hon. Gentleman mentioned leaks. I have seen these leaks, and I think that he will understand, having held this office, that there is probably less to them than meets the eye. However, he made two specific points. On the central emergency response fund—this proves my point—when his predecessor, the right hon. Member for Leeds Central (Hilary Benn), announced the setting up of CERF, we gave it strong support in opposition. I pressed in New York for additional amounts from that fund to be made available, and as part of our review, we will certainly see whether we can build on the substantial benefits accrued from that decision.

The right hon. Member for Paisley and Renfrewshire South (Mr Alexander) made another point about the lessons to be learned from this disaster. I am sure that there will be lessons—although obviously at the moment we are focused on confronting the emergency phase of this disaster—and I hope very much that they will be picked up and learned by the emergency humanitarian review that we have set up and is being chaired by Lord Ashdown.

[Malcolm Bruce (Gordon) (LD)]

I welcome the Secretary of State’s statement and agree with him that the UK’s response, from his Department, across Whitehall and the private sector, and from private citizens, has been a leadership to the world, and also cements the relationship between the United Kingdom and Pakistan, which is very close and important. In the reconstruction effort, will he ensure that there is co-ordination between the World Bank, the United Nations, the IMF and the European Commission so that reconstruction is done to a standard that will ensure that, even if floods like this never happen again, future floods will not result in the same scale of devastation, because the standards will be higher and able to withstand the pressures? Finally, Pakistan has suffered from earthquakes and these devastating floods, and is tackling a very difficult insurgency. In those circumstances, would it not be appropriate for Pakistan to be promoted probably to the top of our bilateral aid list?

[Mr Mitchell]

On the last point raised by the Chairman of the International Development Committee, I said before these floods hit Pakistan that I thought it likely that, as a result of the bilateral aid review, Pakistan, within a comparatively short period, would become Britain’s most significant bilateral aid programme—so I underline the point that he made in his third question.

On his first point, I thank him for what he said about British leadership. It is encouraging to note that there has been a significant increase in support for the Secretary-General’s appeal fund. On his second point, about the reconstruction effort, he is clearly right that there needs to be strong co-ordination between all those taking part, and I hope that it will be provided by the pledging conference, which undoubtedly will take place before too long, and which I hope will take place in Islamabad.

[Stephen Timms (East Ham) (Lab)]

The Secretary of State will know that concern has been expressed about the effectiveness of Pakistan Government agencies in responding to the terrible crisis that has engulfed that country, perhaps with the exception of the Pakistan army. However, he has rightly drawn attention to the contribution of NGOs—he mentioned Save the Children, Oxfam and Islamic Relief. What is his judgment of the right balance for the deployment of his Department’s funding to, on the one hand, agencies of the Pakistan Government and, on the other hand, the NGOs that he has mentioned and others?

[Mr Mitchell]

The right hon. Gentleman is right to focus on those points. It is fair to say that no Government in the world would have been able to handle a catastrophe of this scale, and there are many who believe that the Government of Pakistan have done rather better than might have been expected. Despite the experience from the earthquake gained by General Nadeem, who is in charge of the disaster authority on behalf of the Government, and whom I met during my visit, there has clearly been a struggle. However, the Government have done better than many people expected.

The right hon. Gentleman asked how British taxpayers’ money and the money so generously donated to the Disasters Emergency Committee by the British people is being allocated. None of it goes through the Government of Pakistan; it all goes through the United Nations or through the NGOs that he mentioned, which are doing such good work in very difficult circumstances.

[Mr James Clappison (Hertsmere) (Con)]

I join the welcome for the Secretary of State’s statement. There will be widespread public support for the international lead that this country has taken in responding to this immense disaster. Does it follow from what he just said to the right hon. Member for East Ham (Stephen Timms) that British aid is being administered through his Department and through NGOs and charities directly and promptly, so that the public can have confidence that the money being spent by the Department and the money that they are generously donating is getting through directly and promptly to those in need?

[Mr Mitchell]

My hon. Friend is absolutely right to say that the money that is going from the British taxpayer and from people’s generous donations to the Disasters Emergency Committee does not go through the Government of Pakistan. It goes through the UN cluster system, with which he will be familiar, and through the NGOs that have been mentioned. If he cares to visit the DFID website, he will see an easily accessible monitor that enables people to track where British aid is going and what it is buying.

[Anas Sarwar (Glasgow Central) (Lab)]

I join the Secretary of State’s tribute to the British people. Every time there is a disaster, they put out their hands in friendship and donate generously. They have done so again now, and we must pay tribute to them for that. I also agree with his comments about the woeful response of the international community, and I understand the answer that he gave to the shadow Secretary of State about the discussions that he has had. It is always easy to get a response and donations when people can see the sad scenes and the high waters on their television screens, but what will happen when the waters subside and the cameras are switched off? The communities and the people of Pakistan will not overcome this tragedy in a matter of days; it will take months, if not years. The message that we need to get across to the international community is that, yes, Pakistan needs its support now, but it will also need it in the months and years to come. On that last point, what work is DFID doing alongside the NGOs and other international organisations on the ground to ensure that there is a co-ordinated response through the Disasters Emergency Committee?

[Mr Mitchell]

The hon. Gentleman speaks eloquently about the needs that will continue for many years as a result of this crisis and of the development needs of Pakistan. Three phases are involved. The first is the emergency phase, which I hope can be brought to a conclusion as swiftly as possible. The second is the rehabilitation and rebuilding phase, which will involve the pledging conference, to which I referred, in order to co-ordinate the international effort. The third will involve the long-term development programme. We are currently reviewing Britain’s contribution to that through the bilateral aid review. There will need to be great co-ordination between all members of the donor community and the Government of Pakistan to ensure that the programme addresses the long-term needs of the country and offers hope to the people who are in a pretty desperate position today.

[Sajid Javid (Bromsgrove) (Con)]

I welcome my right hon. Friend’s statement and commend the swift action that he and his Department have taken. He will know, however, that the Pakistani state is unfortunately riddled with corruption on many different levels of bureaucracy and politics. Will he reassure us that his Department is taking whatever action it can to ensure that British taxpayers’ money is being spent wisely and used to provide relief and humanitarian aid?

[Mr Mitchell]

My hon. Friend is right to focus on the importance of bearing down on corruption, but I have made it clear that, in regard to all the emergency relief work that is being done through my Department on behalf of the British taxpayer, and through the Disasters Emergency Committee, none of the money goes through the Government of Pakistan.

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

Understandably, the emphasis at the moment is on the immediate assistance required, and tributes have rightly been paid to the magnificent response of the people of the United Kingdom in that regard. Towards the conclusion of his statement, the Secretary of State referred to the need to drive forward a radical economic reform agenda. How does he envisage that panning out over the next few months as the Government and people of Pakistan prepare for the future?

[Mr Mitchell]

The hon. Gentleman will be aware that discussions are ongoing between the IMF and the World Bank and the whole of the donor community. A number of plans, particularly for macro-economic reform in Pakistan, are already in train. The point I sought to make in my statement was that an unprecedentedly strong offer of support from the international community also merits an unprecedentedly strong focus by the Government of Pakistan on implementing the reforms that everyone is agreed need to be made, but which perhaps seem to be taking quite a long time to get through.

[Paul Uppal (Wolverhampton South West) (Con)]

I thank the Secretary of State for delivering this ministerial statement. I am glad to see that he is conscious of the developing problem in Sindh province and also, as he mentioned, in parts of Punjab. Does he share with me the general concern he highlighted about the lack of a proper response and the poor response from the international community? It is crucial in this politically sensitive area to address this issue because it affects hearts and minds. He may be aware of initial media reports showing that Taliban-inclined elements were helping with the very initial relief. If it were ever the case that people remember who their friends are in times of need, it applies now.

[Mr Mitchell]

I thank my hon. Friend for his contribution. On his first point, all the money announced in New York—the second tranche, which is the doubling of our funding—is now being spent in Sindh and Punjab, for reasons that a number of hon. Members on both sides of the House have underlined.

My hon. Friend is right to identify the poor response, although while I was in New York there was a big increase in support from Saudi Arabia, Canada and Australia, and a number of other countries have followed since. I very much hope that at the European Union meetings taking place in the next fortnight, there will be a strong focus on ensuring that all the countries that can come to the assistance of Pakistan in its hour of need do what they can to help.

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

In respect of flood risk management in the future, to what extent will the UK Government support sustained investment in the adaptation of Pakistan to climate change, therefore making the country’s infrastructure and communities more resilient to future flooding?

[Mr Mitchell]

The hon. Gentleman is absolutely right to talk about the importance of ensuring that there is effective investment in flood defences. It is something that the international community and the Government of Pakistan will want to look at in all three of the phases I described.

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

May I ask my right hon. Friend to focus a little more closely on the second point raised by my hon. Friend the Member for Wolverhampton South West (Paul Uppal)? Was the Secretary of State as appalled and disgusted as I was to hear of the threats being issued by the Pakistani Taliban to murder “infidel” aid workers who presume to try and help their fellow countrymen? I know that his emphasis must be on the relief of suffering at the moment, but when that issue has moved further forward, will he have conversations with Foreign Office Ministers on how best to make it clear to the Pakistani people in future what sort of atrocious attitude and immorality is rife among those who say that people who want to help the people of Pakistan ought to be murdered?

[Mr Mitchell]

My hon. Friend makes an eloquent contribution and I can assure him that we discuss on a regular basis these and every other matter related to the emergency in Pakistan with colleagues right across Whitehall. It seems to me that in confronting the specific issue he raised, it must be right to try to ensure that the international community and the Government of Pakistan get the relief as effectively as possible to the people who are earnestly waiting for it because they have been cut off from it. In a sense, that is the answer to his question about what the international community can do to combat the malign influences that he described.

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

In comparing the inadequate and belated response of the international community with the heartwarming and generous response of the British public, may I draw the right hon. Gentleman’s attention to the numerous fundraising activities that are taking place in my constituency? Many of my constituents have relatives in the afflicted area. Will he enable his Department to work closely with Manchester airport to ensure that goods sent as a result of those fundraising activities are conveyed from Manchester to Pakistan as soon as possible?

[Mr Mitchell]

I thank the right hon. Gentleman for the encouragement that he has rightly given to communities in and around his constituency. I will certainly refer his point about Manchester airport to my officials, who will write to him shortly with an answer.

The right hon. Gentleman is also right to pay tribute to the extraordinary generosity of the diaspora communities in raising funds. I am thinking particularly of Islamic Relief, which is doing incredible work, but it is not the only organisation involved. Last Friday I had a chance to spend time with the Pakistani diaspora community in Birmingham, where I experienced a thought process very similar to the right hon. Gentleman’s.

[Dan Byles (North Warwickshire) (Con)]

I echo the Secretary of State’s thanks to our overstretched armed forces for their assistance to people who have been devastated by the flood. Does he agree that their logistic capabilities represent a uniquely effective resource for conveying aid to where it is needed, quickly and flexibly, at such times of crisis? Will his Department be making a submission to the Ministry of Defence as part of the strategic defence review, urging it to preserve that capability?

[Mr Mitchell]

My hon. Friend is right to draw attention to the strong support that has been provided across Whitehall throughout the weeks of the emergency. I have already mentioned the work of the Royal Air Force and the assistance that has been given with the supply of bridges. MOD officials in Islamabad are working more than 18 hours a day with officials from the Foreign Office and from my Department. Moreover, NATO has offered to provide 300 hours of flying time in support of the United Nations and others involved in the relief effort, and I know that they are considering how and when to take up that offer.

[Joan Walley (Stoke-on-Trent North) (Lab)]

My constituents with families in Pakistan will welcome the statement; they will also welcome the web monitor enabling them to track progress. Given the scale of the emerging public health problems and the need to consider long-term reconstruction, will the Secretary of State tell us a little more about his discussions with the World Bank about debt cancellation?

[Mr Mitchell]

I thank the hon. Lady for her comments. I know that she is heavily engaged with the community in her constituency on these matters. As I have said, we are doing everything we can to support all who are involved in combating the public health crisis, especially in Sindh, where the problem of water-borne diseases is so dangerous and prevalent. As for public debt, it amounts to only about 3% of Pakistan’s budget, so it should be seen in context. However, all those issues will be considered during the ongoing discussions with the International Monetary Fund and the World Bank.

[Greg Mulholland (Leeds North West) (LD)]

Like other Members, I have received an incredible response from people in my constituency. I am sorry that I cannot attend this evening, with the lord mayor of Leeds, a late breakfast at the Makkah mosque, where there has been some wonderful activity.

May I take the point made by the hon. Member for Stoke-on-Trent North (Joan Walley) a little further and refer the Secretary of State to the ONE International Pakistan debt campaign? Surely, as happened in the case of Haiti, we should consider diverting some of Pakistan’s debt payments over the next couple of years to people who need the money so desperately now.

[Mr Mitchell]

I agree with the hon. Gentleman’s final point, and I know that the IMF and the World Bank will show great sensitivity in that regard. As I said in my previous answer, we are dealing with relatively small interest payments, but he is right to suggest that we should be sensitive about the matter at this time. I also refer him to my earlier remarks about the importance of macro-economic reform. That will undoubtedly be one of the issues dealt with in the discussions on that subject.

[Barry Gardiner (Brent North) (Lab)]

The Secretary of State spoke of the devastation caused when a wall of water travelled 1,200 miles down the country. A question that his officials will, of course, have considered is why it was able to do that, and no doubt the answer that they will have given the Secretary of State is that there was demand for wood from the forests to provide cooking fuel and enable construction to take place in Pakistan. Once the immediate need no longer exists and reconstruction is under way, will the Secretary of State consider the need for reconstruction of green infrastructure and the forests that would, in the past, have stopped that wall of water from travelling those 1,200 miles?

[Mr Mitchell]

I am grateful to the hon. Gentleman for both asking and answering his question. He is right to talk about the importance of developing green infrastructure as part of the recovery phase, and I can assure him that that will be considered, but the truth is that a flood of such a completely unprecedented scale would have swept away almost everything in its path.

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

I thank the Secretary of State for his statement. I also thank him on behalf of my constituents, many of whom have family in Pakistan, for the work his Department has done. While declaring an interest as a member of the Rotary club of Bury, may I ask the Secretary of State to join me in paying tribute to the work of Rotary International for the work it has done in helping to relieve the suffering of those in Pakistan who have been affected by the floods, particularly through the work of its ShelterBox scheme?

[Mr Mitchell]

I thank my hon. Friend for his comments, and he is of course right to say that the 1 million or so members of the Pakistani diaspora, many of whom have relations directly affected by the flooding, have been extremely concerned and worried. We have been able through a number of mechanisms to give both information and reassurance. I pay tribute to my noble Friend Baroness Warsi, who has been very heavily involved with all the diaspora community and who came with me to Pakistan. I also join my hon. Friend in paying tribute to the work of Rotary, which makes such a tremendous contribution in this and so many other areas of development.

[Rushanara Ali (Bethnal Green and Bow) (Lab)]

I welcome the Secretary of State’s statement. I remind the House that the community in my constituency has, with the rest of the British public, been working hard to raise money. A third of my constituents are of Bangladeshi origin and they are no strangers to floods causing such devastation as has happened in Pakistan.

I urge the Secretary of State to work with the EU countries to focus on what steps can be taken to tackle the long-term challenges of climate-related disasters. What additional funding, on top of what has already been committed and Government aid funding and emergency aid, is he committing to climate change adaptation?

[Mr Mitchell]

On that final point, the hon. Lady must wait for the outcome of the spending review, which will be announced on 20 October, but I assure her that the points she made so eloquently are being actively considered. This morning, I discussed with the Foreign Secretary the point she made about ensuring that we work closely with EU members to take forward our common endeavours. Her comment about closer EU co-ordination is very well made.

[Jeremy Lefroy (Stafford) (Con)]

I thank the Secretary of State for his statement and join him in thanking all those across the country who have given so generously. This weekend, Staffordshire county council will host a dinner involving members of the local community to raise funds for disaster relief.

The Secretary of State will be aware that there are great concerns about the effect of the floods on agricultural land. Will he keep under review the long-term effect on agriculture, particularly the effect on upcoming planting, and how the UK can assist in relieving the problems that Pakistan is likely to suffer?

[Mr Mitchell]

My hon. Friend is absolutely right about the devastation that has struck both livestock and crops, upon which people in Pakistan are absolutely reliant. I set out in my statement the scale and extent of that devastation. We are already providing funding for seeds for the forthcoming planting season and we will keep under close review the important aspect my hon. Friend highlights, which will directly affect the extent of food security in Pakistan in the forthcoming year.

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

I, too, welcome the Secretary of State’s statement, as will many of my constituents in Leyton and Wanstead. On the question of economic reform, in his discussions with the IMF and other international bodies, will he guard carefully against any suggestion of anything that resembles structural adjustment programmes? They might not be called that any more, but the fact is that elements in many international bodies are still keen on such programmes, which in the past have wrought the kind of devastation that we have seen in many countries, including environmental devastation.

[Mr Mitchell]

The hon. Gentleman makes a good point. After my discussions not only with the IMF but with the Minister of Finance, who is working so hard in Pakistan on these reforms, I can assure the hon. Gentleman that a measured approach is being taken on those matters.

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

The Secretary of State’s statement and answers show our solidarity with Pakistan and practical aid. Is he willing to add to what he has said by continuing to press both European and Commonwealth colleagues to increase their contributions, by exploring expressly with the IMF a two-year moratorium on the repayment of debt, and by seeing whether the good experience on Haiti, where a trust fund was established, might be repeated, to give reassurance internationally as well as nationally that money will continue to be spent well and in a way that is acceptable to the whole community?

[Mr Mitchell]

On the hon. Gentleman’s third point about a trust fund, that is a mechanism for which there might clearly be a significant role, but we must allow the pledging conference and the other discussions that are going on in the donor community to develop to see precisely what role it might play. He is right, in particular, to identify the Commonwealth. A number of fellow Commonwealth members came quite rapidly to the support of Pakistan, but it is important that all European countries and donor nations that have the significant ability to help do so at this time.

[Fiona Mactaggart (Slough) (Lab)]

Does the Secretary of State agree with me that the generosity that our constituents have shown puts to shame the laziness and inadequate support of other countries? In Slough over the past couple of weekends, I have been involved in bucket collections that have raised more than £3,000 in a small town. Will he ensure that as well as a short-term urgent response to the health crisis, he makes a more strategic long-term investment in improving Pakistan’s health infrastructure, which is grossly inadequate? That is illustrated, more than anything else in my view, by the fact that the maternal mortality rate is much worse in Pakistan than in many much poorer countries.

[Mr Mitchell]

The hon. Lady is absolutely right to draw attention to the maternal mortality figures in Pakistan. That is one of the reasons why, at the G8 summit earlier this year, the Prime Minister focused on millennium development goal 5 and maternal mortality—a strong priority for the United Kingdom. I hope that this is something that we will be able to take forward at the forthcoming MDG summit. On her other points, I pay tribute to the work that she is doing to support fundraising efforts in her constituency. I know that Members on both sides of the house are doing that, and we need to continue to do it.

[Andrew Stephenson (Pendle) (Con)]

I welcome the statement from my right hon. Friend. In my constituency, there has been huge support for the victims of the floods, and I pay tribute to the work of the Secretary of State and his Department. However, I have attended a number of fundraisers for the flood appeal where many people have expressed concerns about the effectiveness of the Pakistani authorities. I know that he has already provided the House with reassurances that the aid to deal with the immediate crisis is being delivered through non-governmental organisations, but what reassurances can he give us that similar scrutiny will be given to long-term infrastructure and reconstruction projects?

[Mr Mitchell]

My hon. Friend is right to talk about bearing down on corruption and ensuring that for every pound of hard-earned taxpayers’ money, as well as of hard-pressed donor money that is spent, we get 100p of value. That is a preoccupation in all the work we do in my Department, and it will continue to be so throughout all the phases of recovery that we have discussed today.

[Hugh Bayley (York Central) (Lab)]

I welcome the Secretary of State’s response. News reports from Pakistan in recent weeks seem to indicate a high level of support from the Pakistani people for the actions of the military, but a much lower level of support for the actions of the civilian Government. I do not want to be alarmist about the future of civilian rule in Pakistan, but will the Secretary of State give me an assurance that his Department will continue to make improvements in governance a very high priority indeed, and will make bolstering civilian government in Pakistan an important part of our aid programme over years to come?

[Mr Mitchell]

Yes.

[Dr William McCrea (South Antrim) (DUP)]

The people throughout the United Kingdom have raised an amazing £47 million, in addition to the money coming from Government. Can the Secretary of State assure me that there is proper co-ordination of where all that money is being directed, to ensure that those who need it most will be able to get that aid?

[Mr Mitchell]

I believe I can give the hon. Gentleman the assurance that he rightly seeks. All of the taxpayers’ money is allocated through my officials in Islamabad, after careful discussion of what results will be delivered by the spending of that British taxpayers’ money. Sometimes it takes a little longer to allocate the funds precisely, but we do so with the confidence that it will have the effect that those who have provided the money would rightly insist on seeing.

[Mark Durkan (Foyle) (SDLP)]

If the international community’s initial response was so woefully inadequate, can the Secretary of State tell us that he is now confident that it will be better geared in response to the secondary humanitarian public health crisis that he anticipates; and will others be there for the long-term reconstruction needs, in the way that he has underlined in the commitments that he has given today?

[Mr Mitchell]

The answer to the hon. Gentleman can only be that time will tell, but I am confident that we are all focused on trying to ensure that is indeed the case, and that focus will continue throughout not only the emergency phase but the subsequent two phases, which I have described.

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

Members across the House have rightly spoken of the work being done by people in their communities. I mention the work being done by the small non-governmental organisation, Edinburgh Direct Aid, which is headquartered in my constituency; it does various work in the areas concerned and is working on this issue as well.

On the question of a long-term response, the rather general information that the Secretary of State is able to give about the EU response—this is no criticism of him—makes me worried that the EU response is not building up as quickly as it should. When does he expect next to meet some of his EU colleagues to try to get not just a short-term response, but a longer-term response of the type that my hon. Friend the Member for Foyle (Mark Durkan) just mentioned?

[Mr Mitchell]

The hon. Gentleman is right to point to the inadequacy of the response from members of the European Union in the early days of the crisis. I think there was a significant improvement in the second week. I had a discussion this morning with the Foreign Secretary, who will attend a significant EU meeting within the next two weeks, where he will make precisely the points that inform the hon. Gentleman’s question.

[Mr Denis MacShane (Rotherham) (Lab)]

As in the past, the Department for International Development and its leadership have risen to the challenge of the crisis and have done our country proud, but I wonder whether the Secretary of State would consider involving more directly the Pakistani diaspora community leadership in our country, perhaps by organising a common trip to Pakistan of himself, the shadow DFID Secretary and the Chairman of the International Development Committee, to show how our Parliament, our Government and our community are now working with British citizens to help solve some of the terrible problems that their linked communities face in Pakistan.

[Mr Mitchell]

I thank the right hon. Gentleman for his generous remarks about my officials, which I will pass on to them, and to others in Whitehall. He is right to stress the importance of the very inclusive approach that we are taking in working with the diaspora communities and with all people who want to assist in tackling this dreadful crisis. The spirit of what he said is embodied in the decision by the Government of Pakistan to take up a proposal from the Opposition to set up a high-level committee to co-ordinate the Government response to the crisis, so I hope he feels that notice is being taken of the importance of everyone putting aside any differences and concentrating on helping in a disaster, which even today is still leaving millions of people without any form of support.

[Jim Shannon (Strangford) (DUP)]

I thank the Secretary of State for his very positive response. In my church on Sunday, as in many churches in my constituency and further afield—in fact, right across the United Kingdom—there was a collection for the people of Pakistan. It is therefore disturbing to be made aware that there is discrimination in some cases—more localised than systematic, I have to say—against people in the Christian community, who say that they are not receiving the relief aid that they should. In his statement, the right hon. Gentleman said that “every penny spent achieves a meaningful output that alleviates the suffering” of all the victims. Will he assure us today that the people in the Christian community in Pakistan, who have been discriminated against through no fault of their own and who are equally subject to the effects of the floods, will be looked after, and will receive the relief that we in the United Kingdom wish them to have?

[Mr Mitchell]

I have not heard the details of what the hon. Gentleman has said, but in view of his concerns, I will certainly look in detail at what he said, and I shall write to him to advise him of what I discover.

Point of Order

Tuesday 7th September 2010 Commons Chamber

16:51

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

On a point of order, Mr Speaker. You will recall granting an urgent question before the recess to, I think, the hon. Member for Islington South and Finsbury (Emily Thornberry) about the death of Ian Tomlinson, a bystander at the G20 riots who was struck by a policeman. The evidence of the pathologist concerned, Dr Patel, was irreconcilably different from that of other experts, and that was cited as the reason for no action being taken. Given that he was last week struck off the register by the General Medical Council, can you tell the House whether you have received any indication from a Law Officer or a Justice Minister that a further statement will be made about the terrible circumstances of the case, which has caused concern throughout the country and on both sides of the House?

[Mr Speaker]

I am grateful to the hon. Gentleman. The short answer is that I have received no such request at all. However, the great likelihood is that Ministers, including Law Officers, will have heard his point of order.

Freedom of Information (Amendment)

Tuesday 7th September 2010 Commons Chamber

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

16:52

[Tom Brake (Carshalton and Wallington) (LD)]

I beg to move,

That leave be given to bring in a Bill to amend the Freedom of Information Act 2000 to remove provisions permitting Ministers to overrule decisions of the Information Commissioner and Information Tribunal; to limit the time allowed for public authorities to respond to requests involving consideration of the public interest; to amend the definition of public authorities; and for connected purposes.

The day when Members of this House backed the Freedom of Information (Amendment) Bill put forward by the right hon. David Maclean, the then Member for Penrith and The Border, will rightly go down in history as one of the most embarrassing days of the previous Parliament. The arguments deployed in favour of that Bill were spurious and specious and collapsed after the most cursory scrutiny. In an article in The Daily Telegraph headlined “House of Knaves”, the Bill was described as “an abysmal decision”, with MPs

“Acting in a way uncomfortably reminiscent of Communist officials in East Germany”.

A Daily Mail headline at the time was no more flattering. It said “MPs’ freedom of information cover-up is a dark day for democracy”. The Sun was characteristically blunt, saying “MPs back ‘squalid’ secrecy bill”. Members of this House—not only those who were whipped into voting for the Bill, but those who failed to anticipate the skulduggery and subterfuge that the Front-Bench teams were willing to contrive, and who were therefore attending to important constituency business on that Friday—have had ample opportunity to consider the damage caused by that capricious and self-serving vote.

It is timely to revisit the issue in the week in which our former Prime Minister, Tony Blair, chose to denounce the Freedom of Information Act as a “blunder”. I would be more inclined to agree with his assertion in 1996 that

“information is power, and any government’s attitude about sharing information with the people actually says a great deal about how it views power itself and how it views the relationship between itself and the people who elected it.”

It was with that view in mind that I sought to introduce the Freedom of Information (Amendment) (No. 2) Bill in 2007, so that I might demonstrate to our constituents that Members were committed not only to protecting FOI legislation but to reinforcing it. In the spirit of the coalition’s pledge both to extend the scope of the Freedom of Information Act and to provide greater transparency, I have introduced today’s Freedom of Information (Amendment) Bill, which will strengthen FOI powers in four key areas. I make no apologies for the sense of déjà vu that some Members may have. The Bill is, broadly speaking, identical to my 2007 Bill, because the weaknesses of the FOI Act remain, with one exception, as academies will now be covered by the Act.

The four key areas that I seek to address are the removal of the ministerial veto; an extension of the time limit within which proceedings can be brought for the offence of deliberately altering a record to prevent the disclosure of information; a limit on the time allowed for public authorities to respond to requests involving consideration of the public interest; and an extension of the range of bodies covered by FOI legislation.

In 2007, I noted that the ministerial veto had never been exercised. Furthermore, I entertained the idea that Members might consider that that was a reason for maintaining it, because Ministers had shown considerable self-restraint in not exercising it.

That argument is now sadly redundant. In the intervening period, the ministerial veto has been used twice by the right hon. Member for Blackburn (Mr Straw), in his then role as Justice Secretary, in the first instance, to block the release of minutes of Cabinet meetings in the run-up to the Iraq war, because releasing the papers would do “serious damage” to Cabinet government and outweigh public interest needs. In the second instance, it was used to block the disclosure of minutes of the Cabinet Sub-Committee on Devolution to Scotland, Wales and the Regions from 1998.

The exercise of the ministerial veto introduces a veil of secrecy and affords an opportunity for arguments in favour of the public interest to be dismissed out of hand. Furthermore, its deployment sets a dangerous precedent and paints a worrying picture of a disdainful relationship between Government and the electorate.

Similarly, it may appear that there is no need to extend the period during which proceedings can be brought for the offence of deliberately altering a record to prevent disclosure of information under section 77 of the FOI Act—that is a new proposal. There do not appear to have been any prosecutions for the offence.

In the wake, however, of the climatic research unit e-mail controversy—or “Climategate”, as it is known to the tabloid media—the Information Commissioner’s Office found evidence that the CRU tried to avoid disclosure by deleting information. In a letter from the ICO to the CRU, the deputy commissioner confirmed the fact that

“elements of a section 77 offence may have been found here, but cannot be acted on because of the elapsed time”,

and said that that was “a very serious matter.”

In its subsequent report, the Select Committee on Science and Technology recommended that the six-month time limit between offence and prosecution for breaches of section 77 of the Freedom of Information Act be reviewed. The amendment proposed by my Bill would allow a prosecution to be brought within six months of sufficient evidence of the offence coming to the prosecutor’s knowledge, rather than within six months of the offence being committed. However, a prosecution could not be brought more than three years after an offence had been committed.

I would now like to move on to the subject of time limits within which public authorities must respond to public interest FOI requests. In 2009, 1,551 requests to central Government Departments and other monitored bodies were subject to an extension beyond the 20-working-days period, so that the issue of whether information should be disclosed on public interest grounds could be considered. That is allowed, as public authorities can use whatever additional time is “reasonable in the circumstances” to consider the Act’s public interest test. Figures from a Ministry of Justice publication, “Freedom of Information Act 2000: 2009 Annual Statistics on implementation in central government” show that of those extensions, in 155 cases, the extension was between 21 and 30 days; in 129 cases, it was between 31 and 40 days; and in 276 cases, it was over 40 days, but how far over is not known. If the Bill is introduced, all those requests, totalling more than 500, would receive a response in fewer than 40 days. Departments such as the Home Office, which set a record in 2007—I do not know whether that is still the case—of 18 months for tardiness in answering an FOI request would no longer be able to use delaying tactics to postpone the release of embarrassing information.

Finally, the Bill proposes an extension to the definition of public authorities to include publicly owned companies, publicly funded “not for dividend” companies, and private contractors delivering high-value public sector contracts. At present, a company that is wholly owned by a public authority is subject to the FOI Act in its own right under section 6(1) of the Act. However, where a company is jointly owned by two or more public authorities, it is not subject to the Act. Equally, where a public authority owns 99% of the shares and someone else owns only 1%, the company is not covered. The proposed amendment would bring within the scope of the Act any company where at least 51% of the shares were owned by one or more public authorities. Not-for-dividend companies such as Network Rail, which are not covered by FOI although the Government are the sole shareholder, would have their secrets revealed if the Bill were to become law.

The argument about private contractors doing public work for public authorities is less clear. The Secretary of State has the power to designate private contractors under the Act, but has never done so. The Bill would include only a very small number of very large private contractors working for a public authority—organisations such as Capita or Serco, for instance—which had contracts of a value exceeding £1 million and covering a period of more than 12 months. Clearly, such organisations are in effect quasi-public authorities delivering public services and they must not be allowed to avoid the scrutiny provided by FOI legislation. They must be covered by FOI rules too.

I have set out today in this Bill four simple measures that demonstrate the Government’s commitment to extending FOI and demonstrate that the decision taken three years ago to support the FOI (Amendment) Bill was an aberration. This Bill will strengthen FOI legislation, not emasculate it. I urge Members to support the Bill.

17:01

[Mr Denis MacShane (Rotherham) (Lab)]

I congratulate the hon. Member for Carshalton and Wallington (Tom Brake) on a vigorous speech. I found little in it with which I would disagree, but I think his Bill should be taken much further forward. My only slight worry was the way in which he so enthusiastically prayed in aid at the beginning of his speech quotes from The Sun and the Daily Mail. I gently say to him, even if he is now sitting on the Government Benches, that if he lies down with those papers, he may end up getting very flea-bitten indeed.

However, the hon. Gentleman is right to bring to the House concerns about the Freedom of Information Act, and he is right to quote the former Prime Minister, Tony Blair. I have his book, which says:

“Freedom of Information. Three harmless words. I look at those words as I write them, and feel like shaking my head till it drops off my shoulders. You idiot. You naïve, foolish, irresponsible nincompoop”—

and that is only on freedom of information. I find it rather touching and a healthy thing that we have a former Prime Minister prepared so to describe himself. I have searched in vain in the memoirs of Baroness Thatcher or Sir John Major for any similar recognition that they now have the slightest scintilla of doubt about something that they did.

I suggest gently to the House that the Freedom of Information Act, which became fully operational in 2005—some five years ago—was meant to lead to better government and better journalism. It has been an article of my faith since I first joined the National Union of Journalists about 40 years ago; in the 1970s, it was loony lefties like me who argued for freedom of information. Bit by bit we won the argument. We could not persuade the then Labour Government, we could not persuade the 1979-1997 Government, but we did persuade Tony Blair, and we now have freedom of information on the statute book.

I ask the question again: have we better government as a result? In May, the British people gently suggested that they were not quite so sure that their Government were a paragon of virtue who should be re-elected. If any right hon. or hon. Member in the House is prepared to aver that we now have much better journalism and newspapers as a result of freedom of information, I kindly ask them to put up their hand. Quite.

Freedom of information has coincided—I am not saying that it is cause and effect—with poorer government, and I very much hope that the hon. Gentleman gets his turn with a company car, because then he will find out what I am talking about. In large areas of government, the written discussion and advice that are now on offer to the Ministers who have to make decisions are weaker, because the deciders—the policy makers—are looking over their shoulders and saying, “Will one tiny section of what I am writing appear on the front page of the Daily Mail, The Sun, The Daily Telegraph or any other paper?” As a result, they hedge their bets.

I started to see that happening during my time as a Minister in the Foreign Office, when it was a privilege to receive, frankly, some of the most brutal assessments of what was happening in the world from very, very able foreign service officers. As the dawn of freedom of information approached, however, those assessments became softer and more careful, because, although there are provisions for not revealing policy and the rest of it, they were not sure whether some of what they might write might, in some other context, be made available for the delectation of our journalists.

I do not have a solution to the issue. Freedom of information is still my article of faith, but we may have imported the model in America, where there is a clear separation between the legislature and the Executive and, on the whole, newspapers are more sensitive about facts, to our system, where the Executive and the legislature are fused and a great number of requests—not all, because many diligent journalists use FOI very effectively—are made purely to seek out sensationalist tittle-tattle. I look at the disgraceful story about the Foreign Secretary last week, in which some of those blog rats, those blog boys, used freedom of information only and exclusively to try to peddle innuendo, smear and rumour. I do not know the answer, but I do believe that we need a serious review of the Act. We need to have a discussion, because the employer of the UK Information Commissioner is, according to Wikipedia, the

“Parliament of the United Kingdom”.

But is he in any way accountable to us? Does he make formal reports to us? Is there a Committee to which I might put questions about what he does? The answer is no, and we as a House need to look into that.

I would go further than the hon. Member for Carshalton and Wallington. He is a radical and a liberal, but he is in this wretched coalition, so suddenly we can see his liberalism being slowly vitiated as he becomes more and more conservative. We saw that process yesterday, when there was absolutely no intervention from senior Liberal Democrats on the Andy Coulson affair. It was left to the hon. Member for Torbay (Mr Sanders) to raise the issues.

I would like to see the Freedom of Information Act extended to all those organisations and companies that have any formal status within the public realm. We have referred to the fourth estate, and it is time for freedom of information laws to extend fully to all our media organisations. They have far more power than many public agencies, local councils and the rest, which are covered by FOI legislation. What our media organisations and the oligarchs—often from overseas—who own them decide to do has a huge impact on our public life, and any company that is in receipt of taxpayers’ money should also be covered by FOI. [Interruption.] I am glad to see the hon. Member for Carshalton and Wallington, from a sedentary position, giving me some gentle support; I hope that we can secure some cross-party agreement on the matter and, perhaps, even consider temporarily re-forming the old alliance.

We also need to look at the UK Information Commissioner. That distinguished gentleman spent the early part of his life serving as a Liberal Democrat councillor, and he has twice stood as a Liberal Democrat candidate for Parliament. I wonder whether the Information Commissioner should be so connected, in such a direct political way, with one of the parties now in government.

We also need to discuss the exact gap between freedom of information and the freedom to have a private life, although I do not want to repeat my remarks about last week’s appalling slurs against the Foreign Secretary. We now have the extraordinary example, well known to the House, of our own Independent Parliamentary Standards Authority, which has been leaking details about right hon. and hon. Members to the press. When the sensationalist press have applied to it under freedom of information, the authority has given details of secret notes kept about MPs.

Perhaps Ministers are all good gentlemen who never use swear words, blow their tops or get cross; I certainly know that the Minister for the Cabinet Office, who is sitting opposite me, has never, ever used naval language in his life and is a paragon of niceness to his subordinates when he is feeling upset. Frankly, however, if his subordinates kept secret notes about him that were released every other week under FOI, there would be the most wondrous headlines to amuse us. IPSA did that. It did not stand up for a modicum of privacy and it allowed FOI information to be used against hon. Members.

My hon. Friend the Member for Glasgow South (Mr Harris) has asked IPSA for some information but it has refused to provide it, so he put in a freedom of information request, but IPSA has refused to comply with that. This public body is willing to put FOI information into the public domain to the detriment of right hon. and hon. Members, yet tries to shelter itself from and refuses to co-operate with FOI requests.

Those are some of the paradoxes. We need a debate and a review. The hon. Member for Carshalton and Wallington has done the House a great service. Now let us have a wider debate on the reform of how FOI works.

Question put (Standing Order No. 23) and agreed to.

Ordered,

That Tom Brake, Caroline Lucas, Dr Julian Huppert, Dan Rogerson, Tim Farron, Mike Crockart, Stephen Lloyd, Mr Richard Shepherd and Simon Hughes present the Bill.

Tom Brake accordingly presented the Bill.

Bill read the First time; to be read a Second time on Friday 12 November and to be printed (Bill 68).

Superannuation Bill

Tuesday 7th September 2010 Commons Chamber

[Relevant document: The oral evidence taken before the Public Administration Select Committee on 27 July (HC 397) on the Civil Service compensation scheme.]

Second Reading

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

I have to inform the House that Mr Speaker has selected the reasoned amendment in the name of the right hon. and learned Member for Camberwell and Peckham (Ms Harman).

17:13

[The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)]

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

In a statement to the House on 6 July, I made clear the Government’s intention to make the civil service compensation scheme affordable and I set out our intention to legislate to underpin the negotiations about achieving that. I start by stating my unqualified support for the British civil service; I firmly believe that our system of a permanent civil service is one of the jewels of our constitution.

The service’s values of political impartiality, recruitment and advancement on merit, and the public service ethos are as much to be cherished and nurtured today as they ever were. The service is admired throughout the world for the way in which it serves the elected Government of the day. A steady stream of visitors from other countries send their civil servants to find out how it is done here. It is a pleasure, on returning to government—after an 18-year sabbatical, in my case—to discover that those virtues and values remain intact.

In the latter part of the last Parliament, I was pleased to support the previous Government’s actions in introducing, rather belatedly, it has to be said, civil service legislation—only 154 years after it was promised in the Northcote-Trevelyan report, but better late than never. That was an important step in ensuring the continuance of an impartial civil service.

I am also delighted to find that the service continues to attract the best and the brightest, with the civil service fast stream recognised as one of the most prestigious graduate programmes in the country. So the Bill is emphatically not an attack on the civil service: it is a necessary measure to deliver fairness and affordability in the appallingly challenging fiscal circumstances in which the last Government left Britain.

It might be helpful to the House if I set out some of the history and background to how we have got to where we are today. The history of compensation in the civil service is a long one, with the first legislation covering it having been passed more than 150 years ago. The ability of the state to pay compensation to civil servants on the loss of office was created under the Superannuation Act 1859. That Act did not create a right to compensation, but it created a framework under which such payments could be made. The Superannuation Act 1965 consolidated the previous Acts and included provision for the early payment of pensions to those aged 50 or over who were asked to take early retirement in the interests of efficiency. The same Act repeated the provision of an earlier Act that spelled out that civil servants had no legal entitlement or legal right to the benefits referred to in the 1965 Act, which was itself supplemented by an administrative code that set out the payments that a civil servant could expect, making it crystal clear that there was no entitlement to such benefits.

In the late 1960s and early 1970s, the Fulton committee reviewed the position of civil servants. Alongside that committee, the joint superannuation committee of the national Whitley Council was set up to review the provisions of the 1965 Act. It reported in 1972, noting that improvements were needed to the superannuation scheme

“to restore to the Civil Service the position it had traditionally held as one of the leaders in pension practice.”

That view was reflected in the Superannuation Act 1972, which granted civil servants rights to their pensions. In 1987, the compensation scheme was amended to its current form.

The previous Administration concluded that the current scheme was both unsustainable and indefensible. In the summer of 2008, with support from all parts of the House, Ministers embarked on lengthy negotiations to reform the compensation scheme. The right hon. Member for Dulwich and West Norwood (Tessa Jowell) was one of those Ministers. I think it is fair to say that those negotiations were very long drawn out and protracted. I pay tribute to the efforts of successive Ministers in trying to achieve an agreed outcome; they really did go the extra mile to try to achieve consensus. Arguably, they went too far, because the new scheme that was finally agreed in February this year was still out of kilter with most of the rest of the public sector and would have been unrecognisable, frankly, to anyone in the private sector.

The compromises that created what I still regard as a hard-to-defend scheme were made with the expectation that all six civil service trade unions present at the negotiations would agree it. That appeared to have been achieved, but sadly when the agreement was referred back to the leadership of the Public and Commercial Services Union—the biggest and most numerous union, representing very largely lower-paid civil servants—the rug was pulled from under the feet of the lead PCS negotiator and the agreement was rescinded. So after 18 months of tortuous negotiations, with perhaps an excess of flexibility on the part of the then Government, consensual reform of the scheme seemed as far away as ever. Ministers then took the view, correctly, that PCS’s last-minute volte-face could not be allowed to stand in the way of much-needed reform. Therefore, with the agreement of five out of the six unions, the right hon. Member for Dulwich and West Norwood laid the necessary order to give effect to the reformed scheme.

I have at all times made clear our view that the February scheme did not go far enough. Had it come into effect, however, when the coalition Government took office in May this year, a pressing case would have been made to let it remain in force. Sadly, that option simply did not exist. PCS unilaterally, and without the support of the other five trade unions, sought and obtained judicial review and obtained an order that quashed the February scheme. The option of allowing the scheme agreed and negotiated by the last Government was removed from the table by PCS’s unilateral action.

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

Whatever the rights and wrongs of seeking judicial review, I am sure the Minister will accept that PCS represents some of the poorest-paid workers in the civil service. His scheme, rather than being fair, will be a lot less generous to them. Why is he introducing a scheme that gives the poorest-paid junior jobcentre official only as much protection as a head of Department in the civil service, when on 6 July he promised protection for the poorest- paid?

[Mr Maude]

I will come on to precisely that point, because the hon. Gentleman puts his finger on a real concern that I have. I will deal with it in detail later, if I may, because how to protect effectively the position of the lowest-paid in the civil service is a really important issue that will concern everyone in the House.

It is now more than 20 years since the last serious reform of the compensation scheme and more than two years since the current reform process began, with an unchanged set of arrangements still in place. Frankly, that position cannot be allowed to continue. The current scheme is unaffordable and unsustainable. It allows for payments of up to three times annual salary or, for older workers, enhancements to pension and lump sum payments costing more than five times salary. For some, those enhancements can total as much as six and two thirds times annual salary. That compares with a maximum of 30 weeks’ pay under the statutory redundancy scheme, with a weekly cap on the salary allowable of £380, giving a total of about £11,000.

The level of payments under the current scheme would be excessive even if we were not facing such a difficult financial situation. The last Government left the country with, in the immortal words of their last Chief Secretary to the Treasury, “no money left”. The Government are having to borrow a pound out of every four just to keep pensions paid and schools and hospitals functioning.

[Dr John Pugh (Southport) (LD)]

The Minister has mentioned that the scheme was last revised in 1972, but did not that revision leave all previously accrued rights in place? Is he not doing something different now?

[Mr Maude]

The extent to which rights are accrued is an issue to consider. We are talking not strictly about redundancy but about compensation for loss of office under a statutory scheme, and the relevant rights are those in force at the time when redundancy or loss of office happens. If the statutory redundancy scheme changes, the terms that govern the entitlement are those in place at the time when the redundancy happens. I understand my hon. Friend’s point, but I do not believe it applies in this case. I shall deal with that matter a little more in due course.

Our view is that to maintain the current scheme would be unfair as between taxpayers and civil servants and as between workers in the civil service and those in the private sector or the wider public sector. It is unfair also to less well-paid civil servants, which is related to exactly the point that the hon. Member for Birmingham, Selly Oak (Steve McCabe) made, with which I shall deal.

The effect of the current scheme is that it is prohibitively expensive to make redundant civil servants who are highly paid and long-serving. The result is therefore that when money has to be saved by reducing head count, the burden currently falls disproportionately on the lower-paid, more of whom lose their jobs than is necessary or desirable. My view is that lower-paid civil servants suffer disproportionately and are more likely to lose their jobs under the current scheme than would be the case under the arrangements that we are seeking to negotiate. In addition to the very simple cap incorporated in the Bill, we are seeking in parallel to negotiate different arrangements with significantly enhanced protection for lower-paid civil servants.

[Steve McCabe]

Let me say that I want to assume that the Minister’s long-term intentions are exactly as he says, but is it not a fact that under the Bill he will penalise, to an extraordinary degree, the poorest paid people in the civil service? That is the effect of the measure that he is asking us to vote for today.

[Mr Maude]

No. The effect of the legislation will be identical on all civil servants. Under the Bill, the cap would apply uniformly to civil servants. I shall come in a moment to the negotiations that are going on in parallel, because that will deal exactly with the hon. Gentleman’s point.

[John Hemming (Birmingham, Yardley) (LD)]

Obviously we do not want to make civil servants redundant. Does the Bill not make it less likely that lower-paid civil servants will lose their jobs, so in 10 years’ time they will still be employed within the civil service?

[Mr Maude]

My hon. Friend is exactly right and puts his finger on an important point. Because it is so disproportionately expensive under the current scheme to make redundant long-serving and high-paid civil servants, instead of one civil servant who earns 10 times the average—there are some—losing their job, 10 or more lower-paid civil servants might lose their jobs to save the same amount of money. We are seeking to address exactly that issue.

[Mr Alan Reid (Argyll and Bute) (LD)]

I, too, was pleased to hear the Minister say that the Government want a scheme that will be better for the lower-paid, but the Bill does not differentiate the lower and higher paid. Will the Government seek to amend it to allow better compensation for the lower-paid?

[Mr Maude]

It is not my intention to propose amendments of that nature, because in our view such arrangements are difficult to engineer—this is tricky stuff—and are not amenable to incorporation in primary legislation. Such matters should be negotiated. It is precisely for that reason that we are engaged in a parallel process of negotiation with the Council of Civil Service Unions, which I shall talk a little about in a moment, because we are seeking to achieve two things.

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

It is interesting to hear the Minister talking about parallel negotiations with the unions. Will he help me by explaining what negotiations, discussions or consultations there were with any of the civil service trade unions before the publication of the Bill?

[Mr Maude]

Negotiations were carried out by the previous Government over the 18 months before the order was laid, which, as I understand it, exhaustively explored all the options. I met the Council of Civil Service Unions before the election and immediately after. I have had several meetings with the council—at least two, I think—since, and I am proposing to meet the chairman later this week. There is a continual process of discussion and dialogue, which I regard as very important. I do not want the measure to be unilaterally imposed; I want a genuine consensual arrangement, whereby all six civil service unions agree to a new, sustainable and long-term scheme.

[Richard Graham (Gloucester) (Con)]

As my right hon. Friend knows, I am a former civil servant. I am very conscious of the large numbers of low-paid civil servants in this country. He and other hon. Members will know that on average, the UK civil servant receives no more than £24,000 a year, so there are issues of fairness. I give him my full support in taking forward in his negotiations with the various trade unions every possibility of increasing the statutory minimum available for low-paid civil servants. That will fulfil exactly one of the major tasks for the Bill: greater fairness in the system.

[Mr Maude]

I can reassure my hon. Friend that that is exactly our aim. It is one of the great myths—I have sometimes heard this expounded even in this august House—that all civil servants are highly paid. That is simply not the case. As he says, the average pay of the civil servant is, I believe, around £23,000, and half of civil servants are paid £21,000 or less. In the pecking order, as it were, of the different sectors, average pay is highest in the wider public sector, private sector pay is next, and civil service pay is the lowest. So my concern for lower-paid civil servants is real and genuine, and it is based on a proper understanding of the concerns that exist.

[Mr David Hamilton (Midlothian) (Lab)]

Is it not the case that many of the low-paid workers have accepted those low wages because of the conditions of employment, which included a pension scheme and superannuation scheme that meant something? To take that away from them takes away the very essence of why they are there.

[Mr Maude]

I hear what the hon. Gentleman says, and the fact is that in any employment the terms that apply are those that apply when an event happens. People get sick pay when they are sick; they get redundancy pay when they are made redundant. The statutory redundancy scheme, which has the force of law—as indeed this scheme does, as it is a statutory compensation scheme for loss of office—and the compensation to which people are entitled when they lose their office is that which is in force at the time. That is the view that the previous Government took, robustly, having considered—I presume—all the issues as carefully as we have done. So there is a strong view on both sides of the House that this scheme is unsustainable and unaffordable. Even in good circumstances it would be unaffordable, but in today’s tragically difficult financial position—with the budget deficit that we inherited so out of control and high—it would be indefensible to allow it to remain unreformed, as a matter of fairness.

[Stewart Hosie (Dundee East) (SNP)]

I was pleased when, a few moments ago, the Minister suggested that he did not want to impose this change unilaterally. Of course, that ties in with Mr Justice Sales’s comments that that might not be possible without agreement anyway. How confident is the Minister that agreement will be reached, perhaps before this legislation completes its passage?

[Mr Maude]

All I can say is that it would be rash to make predictions. I can express the hope and aspiration that agreement will be reached. I stand ready to meet the Council of Civil Service Unions at any time, and my officials are engaged in genuine and sustained negotiations and discussions with the unions, which are continuing on an almost daily basis. I have to say that I was discouraged this morning when Mark Serwotka, the general secretary of PCS—a man for whom I have considerable respect—said, when asked whether he would challenge the result in the courts again, that he would do so. That does not bode well for a consensual outcome, and the fact is that five of the six unions had agreed the previous scheme, but the rug was pulled by one union, to the disbenefit of everyone concerned.

I have made it clear that I do not see this Bill as the last word. It remains our desire to reform the scheme by negotiated agreement, so there have been significant and continuing discussions. There are two key goals in the negotiations. The first is to deliver additional protection for lower-paid civil servants, and that has to be done by negotiation—

[Mr Michael McCann (East Kilbride, Strathaven and Lesmahagow) (Lab)]

The Minister has said several times that he aims to protect the lower-paid, but I do not follow his argument. Under the current arrangements, someone who is earning £20,000 a year with 20 years’ service in the civil service would receive £60,000 in compensation. Under the February 2010 deal, proposed by the Labour Government, that individual would have received £58,000 in compensation. Under the present proposals, that civil servant would receive £20,000 compensation. Conversely, someone who is higher paid—for example, £40,000 a year—would receive £120,000 compensation under the current arrangements, given that three years is the maximum payment. Under the February 2010 deal, that amount would have been £60,000 because that was the cap, and under the present proposals it would be £40,000. Can the Minister please explain how the lower-paid will be protected?

[Mr Maude]

rose—

[Mr Deputy Speaker]

Order. Before the Minister replies, may I point out that interventions should be short, with quick questions?

[Mr Maude]

The answer to the hon. Gentleman is, as I have said several times already, that this Bill is not the last word and that the additional protection for lower-paid workers has to be done by agreement. I do not want to be in a position where we design as if in some laboratory a complicated scheme to try to give protection for the lower paid, because the right way to do it is by proper negotiations and discussions with the unions—and that is exactly what is going on at the moment. As I said, that is the principal aim of the—

[Several hon. Members]

rose—

[Mr Maude]

I am besieged by suitors, but I will give way to my hon. Friend the Member for Ceredigion (Mr Williams).

[Mr Mark Williams (Ceredigion) (LD)]

I am grateful to the Minister for giving way. I respect the sincerity with which he puts his case, and I also accept that the rightful place for the detailed discussions will be the negotiations with the unions. However, I think what the hon. Member for East Kilbride, Strathaven and Lesmahagow (Mr McCann) is looking for—and I am, too—is a little more detail on, and justification for, those words that the Minister uttered about protecting lower-paid workers. The anxiety out there is real, and the Minister needs to address that a bit more, if he can.

[Mr Maude]

I am reluctant to start conducting those negotiations in public. It would be regarded by the unions, which I think are engaged in good faith in these discussions—certainly, all the indications are that they are engaged in good faith in these private discussions in order to achieve an agreed outcome—as bad faith were we to start to explore them here. All I would say at this stage is that we completely and genuinely understand the need for additional protection for lower-paid workers, of whom there are many in the civil service, and we will seek to achieve that.

[John Hemming]

Does the Minister agree that the difficulty is that the Government need to act and cannot allow one of six trade unions simply to veto all changes, and that if the Government are therefore to put something through, they need negotiating room to offer something better in the negotiations? Obviously, this Bill will not be as good as a final deal that could be agreed with the trade unions.

[Mr Maude]

That is completely right. My hon. Friend puts his finger precisely on the point. Our view is that one union cannot be allowed to prevent necessary reform of a scheme that is unsustainable and unaffordable—and, of course, that is precisely the view taken by the last Government. The order laid by the right hon. Member for Dulwich and West Norwood, which came into effect, I think, in April this year—before it was rapidly quashed by the judicial review sought by the Public and Commercial Services Union—was made on the basis that one union could not be allowed to hold up the necessary process of reform. However, I stress again that we seek genuinely to negotiate additional protection for the lower paid.

[Mr Bernard Jenkin (Harwich and North Essex) (Con)]

I have been listening to these exchanges closely, but will the Minister tell me whether I have understood him correctly? Is he saying that, whatever special measures may be made for the lower paid, which he is not prepared to discuss now for the reasons he outlined, he has no intention of trying to impose them through legislation, and that they will be negotiated come what may, but that this legislation might become necessary in order to provide the framework for such a settlement? Is that correct?

[Mr Maude]

Indeed. I will say more about the relationship between the negotiations and the Bill in a little while. The aim would be to have a whole new negotiated scheme that would make this Bill redundant. Sadly, however, the experience of the last Government shows that it is impossible to place absolute reliance on the ability to achieve total consensus on that. Proper additional protection for the lower paid is a central part of our aim in the negotiations. I will say briefly as well that the other side of that coin should be a cap on payments for the highest paid. Again, it seems to us that basic fairness requires that.

Our second goal in the negotiations is to negotiate a higher cap for voluntary redundancy schemes. It is the essence of most redundancy schemes that there should be scope for voluntary redundancy terms to be more generous than those for compulsory redundancy. However, I would like to make it clear, if it needs to be made clear, that no one wants redundancies at all, but if they are unavoidable, which sadly I believe they will be—they were under the last Government, and in the current fiscal environment, they are even more likely—it will surely be much better to be able to offer more generous voluntary redundancy terms. That is simply impossible under the current scheme, because of its unaffordably generous terms.

We have made some progress in the talks, but they have not yet delivered an approach that is agreeable to all the unions involved and to the Government. If we can secure agreement with the civil service unions to introduce a comprehensive new scheme, we will implement that package rapidly. Until we reach that point, however, we would be failing in our duty to the tax-paying public—and to lower-paid workers outside the civil service who daily confront much less generous terms—if we were to allow the excesses of the current scheme to continue unchecked.

That is why we have introduced a Bill to limit the size of compensation payments. It has only two clauses, which cap the amounts payable under the current scheme. The first creates caps on the level of payment possible. Staff who depart on voluntary terms will receive payments calculated under the current terms, but limited to a maximum of 15 months’ pay. For those leaving on being formally dismissed—effectively, compulsory redundancy—the limit will be 12 months’ pay. Where the civil service compensation scheme terms provide for early retirement instead of or in addition to a severance payment, the total value of the package will be subjected to the same cap of 12 or 15 months’ pay. In these cases, if the actuarially assessed cost of the total package exceeds the appropriate cap, the Bill provides that those individuals will instead receive 12 months’ salary—or 15 months’ salary in the case of voluntary departures—and no change to their pension entitlement.

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

Could the Minister please explain the rationale for proposing these particular terms, which are so much worse than those that were almost agreed before?

[Mr Maude]

My hon. Friend says that those terms were “almost agreed”, but that was far from being the case. In fact, one of the trade unions refused to agree to them, sought judicial review and had the agreement quashed. Given that one of the unions had refused to contemplate agreeing to the relatively modest—if we are honest—changes to the current scheme, it would be unrealistic to assume that we could then go back and say, “Oh, PCS, please feel completely differently, and please execute a rapid volte face from your position of a few months ago.” I take the view that the previous Government took, which is that the situation is not sustainable, and that one union cannot be allowed to stand in the way of necessary reform. That is why we have introduced the Bill, and why we are engaged in a concurrent process of negotiation, through which we genuinely want to achieve a long-term, sustainable settlement.

[Mark Durkan (Foyle) (SDLP)]

The Minister has stressed that five unions—not the PCS—had agreed to the arrangements in February. How many of the unions are in agreement with the framework that will be imposed by the Bill?

[Mr Maude]

Just to be clear, we are seeking to negotiate a new scheme, which would effectively make the terms in the Bill redundant. I make no bones about this: the Bill is a bit of a blunt instrument. It does not seek to create an entire, comprehensive new scheme. It simply imposes a cap on the amounts payable under the current scheme, so that it will be possible for the scheme to operate in a way that is fair to the taxpayer and to workers in other sectors outside the civil service. This is a complex process, and no one should be surprised that there is not instant agreement on a comprehensive new scheme. We are seeking to negotiate all the terms, but particularly those relating to additional protection for lower-paid workers and to a cap on what can be paid to the highest-paid workers.

[Lindsay Roy (Glenrothes) (Lab)]

Can the Minister explain the rationale behind giving preferential treatment to those who seek voluntary redundancy, as opposed to those who are forced to take a compulsory redundancy package?

[Mr Maude]

Almost by definition, if a compulsory scheme offered less work and better terms, no one would take up voluntary redundancy. Voluntary redundancy is better because it can be negotiated and a scheme can be fashioned to meet the precise circumstances of the employing organisation and the work force. It can be designed to be as sensitive as it can be to the particular needs of the situation. Obviously, if a compulsory scheme were more generous than a voluntary one, no one would ever take voluntary redundancy. It is of the essence of any redundancy scheme that voluntary terms should be capable of being more generous. That is why we framed the provision in this way and why part of what we are seeking to achieve in the negotiated comprehensive new scheme is to enable employers in the civil service to configure voluntary redundancy schemes that are more generous than the compulsory scheme.

[Mr McCann]

Will the right hon. Gentleman give way?

[Mr Maude]

I will, but then I will have to make some progress.

[Mr McCann]

I am grateful. Will the Minister confirm that if the negotiations with the civil service unions fail, he will impose the terms that are part of this Bill?

[Mr Maude]

If this Bill progresses through the House, achieves Royal Assent and goes on to the statute book, it will come into effect, so the cap will apply as of the day of commencement. As I said, I hope that we achieve something frankly more grown up, more sustainable and more long term by having an agreed long-term comprehensive settlement. If both Houses of Parliament agree that the Bill should be passed, however, it will come into effect.

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

The Minister is generous in giving way. On numerous occasions, he has mentioned the issue of lower-paid civil servants. There is a great deal of anxiety out there about it and many of us have received representations in respect of it. How does he define “lower paid”? What is his definition of a lower-paid civil servant when it comes to these parallel negotiations?

[Mr Maude]

Well, that is one of the issues that is being negotiated. It can be defined in all sorts of different ways. It can be defined in terms of a proportion of the median salary or it can be defined by an absolute number, which would subsequently need to be updated from time to time. That is precisely one of the issues that is the subject of negotiations, and I hope we can make progress on it.

[Several hon. Members]

rose—

[Mr Maude]

I really have to make some progress and draw to a conclusion because Members of all parties wish to participate in the debate.

I emphasise that if the Bill comes into effect, it will affect only those staff issued with a notice of dismissal or in respect of whom a departure date was agreed after the legislation came into effect. Any civil servant already issued with a redundancy notice or who receives one before the Bill passes into law will not be affected by the restrictions it introduces. The first clause provides definitions to clarify who is covered by the compulsory cap and who is covered by the cap on voluntary departures. The second clause provides for the Bill’s effects to be time-limited. I stress again that we have no desire to see this legislation continue any longer than is absolutely necessary. The inclusion of a sunset provision prevents the legislation from continuing ever onwards. Instead, if we wish to renew it, the Government will be obliged to return to the House to seek approval by an affirmative resolution.

Alongside the provision for prolonging the effects of clause 1, there is also the option to bring forward the termination date. As I have already said, my intention is absolutely to resolve the issue by discussion and negotiation rather than by legislation, and I look forward to making the order that will repeal section 1 of the Act. It was disappointing, as I said earlier this morning, to hear Mark Serwotka, the general secretary of the PCS, pledge to return to the law courts to try to thwart further reform. That bodes ill for the chances of an agreed settlement, but we will strive—we will genuinely strive—to achieve that agreement. It is essential to deliver additional protection, which, I stress, is especially directed at members of Mr Serwotka’s own union. For the sake of his own members, as well as in the national interest and the interest of the taxpayer, I urge him to engage in the negotiations as wholeheartedly as the other five civil service trade unions.

I earnestly hope that a successful negotiation will render the Bill a dead letter before it even hits the statute book. That is my aim, and I will do all that I can to deliver it. In the meantime, however, the Bill is indispensable, and I commend it to the House.

17:50

[Tessa Jowell (Dulwich and West Norwood) (Lab)]

I beg to move an amendment, to leave out from “That” to the end of the Question and add:

“this House, whilst affirming its belief that civil service compensation should be reformed, declines to give a Second Reading to the Superannuation Bill because it provides inadequate protection for some of the lowest paid and longest serving public sector workers; believes that the reform proposals of February 2010 were fair, reasonable and non-age discriminatory, offering protection for the lowest paid workers whilst making substantial savings; and is strongly of the opinion that the publication of such a Bill should have been preceded by a full process of pre-legislative scrutiny of a draft Bill and in full consultation with Civil Service employees.”

I hope that the Minister has studied the amendment closely, because Labour Members believe that it holds the answers he seeks.

At the end of the last parliamentary session, the day before the Bill was published, the Minister declared that when it came to reform of civil service compensation, he wanted to negotiate an arrangement that had fairness built into it. Obviously we welcome that ambition, but we argue that as the negotiations have progressed and the detail of the Bill has become clear, he has failed to live up to his commitment.

The Minister says that he wants a fair settlement, but he has proposed reforms that are harsh, and harshest of all for some of the longest-serving, often low-paid, civil servants. The Minister says that he wants a negotiated settlement, but he has thrown out the progress made by the last Government through just such negotiations, and instead seeks to impose a short-term solution which lacks the legitimacy that comes from open and honest dialogue with the trade unions representing the people who will be affected by the reforms.

I welcome the Minister’s generous remarks, which were sincerely meant, about our nation’s public servants. I join him in recognising the important role that they play in our national life. However, I also argue that they deserve better than the proposals in the Bill. Public servants are too often represented as dead-weight on the taxpayer, as if they were somehow the cause of the deficit.

[Mr Maude]

No, we entirely blame you.

[Tessa Jowell]

That is also misguided, and we can have a further debate about it.

In fact, it is public servants who make our borders safe, help unemployed people back to work, run our courts and prisons, collect our taxes, and support our armed forces both at home and abroad, in Iraq and Afghanistan. With professionalism and integrity, they make the process of government work. The representations that I suspect we have all received in our constituency surgeries seek to make that point. It is being made by the people who provide those services, many of whom are members of the PCS but feel that their motives and their importance are being misrepresented.

[Mr Maude]

Let me make it absolutely clear that we do not blame public servants at all for the disgraceful budget deficit that the coalition Government inherited. Like Tony Blair, we blame the last Prime Minister, who as Chancellor and then as Prime Minister presided over an incontinent approach to the public finances.

[Tessa Jowell]

And let me make it absolutely clear that the Minister has grossly misrepresented the words of the former Prime Minister. Let me also remind him that the deficit arose because of a global financial crisis, and that it was our Government—led by the last Labour Prime Minister—who steered our economy at that stage, who, indeed, provided leadership for the world, and who drew our economy back from the brink of disaster. Let us have no more trivial point-scoring on that subject. I hope that during this debate we shall be able to move on from some of the crass misrepresentation of our country’s public servants and once more recognise the importance of their work, both public and private.

[Richard Graham]

As the right hon. Lady knows, a number of Members on this side of the House, as former civil servants, have already said how important they believe the civil service to be. The amendment, however, focuses on fairness and affordability. Does the right hon. Lady agree that affordability is critical in the current economic climate, and will she tell the House what approach she intends to take? As for fairness, does she agree that the outline given by my right hon. Friend the Minister of his negotiations with the trade unions represents exactly the sort of fair approach that we should be seeking?

[Tessa Jowell]

I intend to test the Minister’s commitment to fairness—with respect, I think that he asked more questions than he answered—and, if the hon. Member for Gloucester (Richard Graham) will contain his impatience, I shall respond to both his tests in relation to the fairness and the affordability of our alternative.

The Minister has made it clear that the civil service compensation scheme is in need of reform, and we agree. The cost of the scheme needs to be reduced. We fully recognise that, in the present climate, it provides over-generous and disproportionate benefits for some very highly paid people. I believe we are all agreed on the need for reform, which is why in February we set out changes to end what would be regarded by the wider public, and by any measure, as over-generous settlements.

The February 2010 scheme would have saved £500 million over the next three years. That was part of our Government’s plan to reduce the deficit. Yes, reform is needed, but it must be the right reform, delivered in the right way. It must be fair and workable, and in particular—here I echo the Minister’s words—it must provide protection for the lowest-paid. It must also be underpinned by open and honest dialogue with the civil service unions representing those who are likely to be affected.

[Martin Horwood (Cheltenham) (LD)]

The right hon. Lady keeps presenting the last Government as the Government who pursued a path of negotiation and what she has just described as open dialogue. In February this year, however, she too pursued the route of compulsion. Does she now regret the precedent that that set?

[Tessa Jowell]

There is all the difference in the world between a settlement that recognises reasonably the proper expectation of the lowest-paid, and the proposals in the Bill. That is the difference that the hon. Gentleman needs to understand.

[John Hemming]

Will the right hon. Lady give way?

[Tessa Jowell]

I am going to make a bit of progress.

In the current environment in which many civil servants are understandably concerned about their jobs, it is even more important for any reform package to be achieved in full consultation and, wherever possible, agreement with the work force. As a result of the Equality Act 2010, which formed such an important part of the last Government’s legislative programme, the Bill is subject to an equality impact assessment, which I took the time to study.

Against the commitments to full consultation and transparent negotiation, we might look at some of the evidence in the equality impact assessment. It asks:

“Does this policy affect the experiences of staff? How? What are their concerns?”

For staff, the following answer is given:

“Exit terms are set out in Civil Service Compensation Scheme, to be capped at levels set out in the Bill.”

That is a perfectly fair statement of fact. The impact assessment then asks whether the policy affects the experiences of staff networks and associations. The answer given is: “As above”—for staff—but also:

“(no consultation due to urgent need for affordable provisions).”

The answer for trade unions is the same:

“As above (but no consultation due to urgent need for affordable provisions).”

When the equality impact assessment looks at the impact on voluntary organisations, the conclusion is that that is “N/A”—not applicable. The impact on race is also deemed not applicable, as are the impacts on faith, disability rights, gender, sexual orientation and age. The impact assessment also asks:

“What were the main findings of the engagement exercise and what weight should they carry?”

That, too, is said to be not applicable.

“Does this policy have the potential to cause unlawful direct or indirect discrimination? Does this policy have the potential to exclude certain groups of people from obtaining services, or limit their participation in any aspect of public life?”

That is not applicable as well.

“How does the policy promote equality of opportunity?”

That is not applicable also. I could go on.

That is not by any stretch of the imagination a proper assessment of the impact of the proposals on the work force, taking account of the obligations that sit on the coalition Government to recognise equality of opportunity.

[Mr Jenkin]

I am interested in what the right hon. Lady is saying, but I think it is incumbent on her to explain to the House why she thinks the Bill might be discriminatory in some way, rather than just advert to a negative and say that that is not good enough. Does she honestly believe that the measures could be discriminatory in some way? If she could explain that to the House, it would be very helpful.

[Tessa Jowell]

The hon. Gentleman asks a fair question, but it is his responsibility to test that. However, because compared with the existing situation these proposals in effect levy the greatest penalty on the longest-serving, and almost inevitably the oldest, civil servants, there is at least a prima facie case for considering whether they are age discriminatory. I draw no conclusions, but I say to the House that I consider that the equality impact assessment has not taken full account of the impact of the proposed measures across the work force. The Opposition consider the terms put forward to be both unfair and punitive.

[John Hemming]

The right hon. Lady often uses the word “unfair”. I assume that she employs her own staff in her parliamentary office and that they are subject to the statutory scheme, with a maximum of 30 weeks’ pay. How does she argue that that, which was set by Parliament, is fair compared with the scheme the Government proposed in February this year?

[Tessa Jowell]

For the very simple reason that, in order to meet the terms of the judicial review, the proposals in the Bill are removing entitlements, expectations and accrued rights from staff who have a reasonable expectation of receiving them. That is why they are unfair.

[John Hemming]

Will the right hon. Lady give way?

[Tessa Jowell]

No, I am going to make progress because many Members wish to speak in the debate.

We argue that no adequate protection is offered to the lowest-paid, with a junior official in a job centre receiving no more protection than a permanent secretary of a Government Department. In introducing the Bill, the Government have insufficiently consulted their employees. The scant information in the equality statement makes that very clear.

[Alison McGovern (Wirral South) (Lab)]

Does my right hon. Friend agree that the fear, which I have come across in my constituency, about these changes is exacerbated by what seems to be scant consultation? Having more consultation would be helpful in dealing with the worry and fear that I have picked up on in Wirral.

[Tessa Jowell]

My hon. Friend makes an important point based on extensive discussions in her constituency with civil servants likely to be affected. She is absolutely right in identifying that fear, but that does not mean that change is not necessary, nor that members of the Council of Civil Service Unions are not reasonable people who are prepared to negotiate in the spirit that they recognise is necessary.

[Richard Graham]

Will the right hon. Lady give way?

[Tessa Jowell]

No, I am going to make some progress—and I think that the hon. Gentleman has already made an intervention.

The very fact that the Bill is designed to expire within 12 months makes its own case for its unworkability as a long-term solution. Instead the Bill is being deliberately used to force the trade unions into compliance. As such it should be seen as a very unusual use of parliamentary procedure to ask Parliament to pass legislation that—as the Minister has made clear—it is hoped will not be implemented.

The Deputy Prime Minister has stated—presumably on behalf of the Government—that fairness will be at the heart of everything the Government do. However, as with so much that the coalition does, the terms put forward under the Bill do not meet the first basic test: they are not fair because some of our longest-serving, and often lowest-paid, civil servants receive no protection under the proposals.

[Mr David Hamilton]

Did the Minister not give it away when he made the point in his opening remarks that it is more expensive to get rid of those at the top of the tree, and therefore there would be an encouragement to get rid of those at the bottom of the tree? Will not low-paid civil servants be really concerned by the attitude now being taken?

[Tessa Jowell]

I think that those at the higher earnings end and those at the lower earnings end are equally entitled to be apprehensive about the proposals.

[Mr Maude]

Let me make it absolutely clear that the point I was making is that, under the current scheme, lower-paid people are more likely to lose their jobs because it is so prohibitively expensive to make higher-paid, longer-serving senior officials redundant. As a result, more lower-paid civil servants get made redundant. The reform is therefore necessary for this reason alone: to protect the jobs of lower-paid workers.

[Tessa Jowell]

Well, let us see how that commitment plays out in practice. I entirely agree with the right hon. Gentleman that the people who work in job centres and at our borders often doing relatively low-paid jobs are the people who make those services happen at all, and I think there would be a marked degree of cross-party agreement about ensuring fairness and protection for such employees. We on the Opposition Benches, however, feel considerable scepticism about whether the proposals will deliver that.

Let me illustrate that and pick up on the point made by my hon. Friend the Member for Midlothian (Mr Hamilton). A member of staff earning less than £20,000 made compulsorily redundant after more than 20 years’ service would see their redundancy package more than halved under the provisions of the Bill; and staff covered by the civil service compensation scheme would receive substantially less in redundancy terms than comparable public sector employees, despite being among the lowest-paid public servants. The proposed cap is half that often seen in local government, education and the NHS.

On the question of protection for the lowest-paid, let me repeat the words used by the Minister in the House in July—he was right about this:

“Contrary to general belief, large numbers of civil servants are not very well paid—half of them earn £21,000 a year or less—and we want there to be extra protection for them.”—[Official Report, 14 July 2010; Vol. 513, c. 931-32.]

So say all of us, but the fact is that the Bill gives no confidence to those lower-paid employees.

[Matthew Hancock (West Suffolk) (Con)]

The right hon. Lady made the comparison between civil service and other public sector redundancy packages. Can she also make a comparison between civil service and private sector mandatory redundancy packages?

[Tessa Jowell]

I am surprised that the hon. Gentleman feels it necessary to ask that question. If employers in the private sector use the basic statutory scheme, it is considerably less generous than even the proposals in the Bill. In a way, that is not the point, because the value that we attach to public servants, to the importance of the jobs that they do and to the commitment to invest in security to prevent turnover and to compensate for what are often lower levels of pay is one of the reasons that such provisions have traditionally tended to be more generous. It is worth reminding the hon. Gentleman—the Minister took us through the history—that the scheme was created by a Conservative Government and amended by a Conservative Government and that attempts at reform were made under a Labour Government. Now, under the coalition Government, we have what amounts to a hollowed out version of the original scheme.

[Richard Graham]

Will the right hon. Lady give way?

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

Will the right hon. Lady give way?

[Tessa Jowell]

No, I am going to make some progress so that Back-Bench Members can get in.

We expect the Government to take seriously the need for proper dialogue and negotiation in circumstances where the individual impact of the changes is so substantial. It is fair to reflect disappointment among the trade unions that the Bill makes no attempt to put in place a long-term solution to the big challenge of the reform of civil service compensation and, as such, no solution is possible given the Government’s failure to engage constructively with their employees and their representatives. That is implicit in the Bill’s final provisions, which are designed to ensure that it is sunsetted, or expires within 12 months, can be repealed at any time and can only be extended for a further six months through recourse to secondary legislation.

The Bill to which the House is being asked to give a Second Reading tonight does not even represent the Government’s settled position. The Minister tells us that his ambition is now a negotiated, sustainable and practical long-term solution, but that ambition merely serves to remind us that the Bill fails to provide such a sustainable solution or one that has been subject to proper dialogue with those affected.

There are questions that the coalition Government and the right hon. Gentleman must answer. The Opposition have made absolutely clear the anticipated level of savings—figures in which there can be confidence—that would have been produced by the February reform package, so I ask the right hon. Gentleman what savings the Government expect to make from the proposals in the Bill. Why do we not have a complete and workable scheme in front of the House as part of the Bill for which a Second Reading is sought? Why are we spending parliamentary time on legislation that simply seeks to provide the right hon. Gentleman with a negotiating tool to use with the civil service unions?

There is, of course, an alternative. It is fair and it is workable. As shown in our reasoned amendment, the February 2010 scheme should form the basis for the reform that we all agree is needed. As the right hon. Gentleman has made clear, it emerged from an eight-month consultation between the Government and civil service staff and would provide a fair resolution to the issue. Now, although five trade unions have agreed and continue to support the proposal, all six have expressed their support for the use of the principles underpinning the scheme as a basis for moving forward. That is an invitation and an offer to the right hon. Gentleman. Such an approach would meet the tests that we have set out for reform and save at least £500 million over the next three years.

Our challenge to the Minister is to put back on the table the February 2010 proposals, which are fair to the lowest-paid, will contribute £500 million to reducing the deficit and will reform the existing scheme. The right hon. Gentleman has already conceded in exchanges with my right hon. Friend the Member for Wythenshawe and Sale East (Paul Goggins) that, had all the unions agreed to this, there would have been—as he put it—a pressing case for acceptance. We therefore ask that he accepts the case now and supports the reasoned amendment. I call on the House to reject the Bill.

18:17

[Alun Cairns (Vale of Glamorgan) (Con)]

Like every Member of this House, I have received significant communications and representations from individuals and from the unions on this matter. Many of us will have significant numbers of public sector employees in our constituencies. I would say that Wales as a whole has a disproportionate dependence on public sector employees—quite obviously, including employees of the civil service—and the Vale of Glamorgan is no different.

It is quite sad for all those individuals and for the House that we are in this position today. The financial state of the nation has led us to this position. The unrealistic position taken by the unions has driven the Minister to introduce such a Bill, sadly without complete settlement with the unions. I was encouraged by some of the statements that he made about the negotiations and I shall come back to them a little later.

It is difficult to believe some of the payments that are made under the current system. In 2007-08, the Department of Health, in 76 individual cases, paid severance compensation of more than £7.8 million—an average of more than £102,000 per employee. I wonder how many of those who were made redundant or who took voluntary redundancy were then re-employed by the Department of Health as consultants, which would obviously have increased the costs to the public purse. In the Department for Environment, Food and Rural Affairs, there are two examples: in one, compensation in excess of £500,000 was paid and, in the other, compensation in excess of £1 million was paid. That position clearly cannot continue and is wholly unreasonable not only to those in the civil service who are paid at lower levels but to the taxpayer who must ultimately foot the bill.

When I discussed those levels of payments with some of the constituents who got in touch with me expressing concern about their own interests, they showed equal disdain towards the levels of compensation that are paid, and they would recognise the absolute need for reform. Such levels of severance paid at the higher level simply cannot continue. It is a burden on the taxpayer and, as has been highlighted, is prohibitive to the reform of the public sector when the taxpayer really needs every efficiency measure to be driven through. Not only is it prohibitive in terms of the level of payments and the high cost of making many of these individuals redundant, but it is prohibitive and damning for people at the lower levels who will have to be made redundant when those at the higher levels cannot be laid off because it would be unaffordable, even when many of their roles have become redundant as a result of the evolution of the Department or because of new technology. The Bill goes further than the previous proposals, but as the financial situation of the country is much worse than was previously stated, the bill must be affordable, and that imperative has obviously influenced my right hon. Friend the Minister in introducing the Bill in such a form.

I do have concerns about the effect on civil servants at lower levels of the pay bands, and we need to recognise their interests. I was encouraged by my right hon. Friend, who highlighted his concerns and the need for negotiations. I would look to the trade unions, particularly the PCS Union, to see that statement in a positive light and negotiate, in the interests of those at the lower levels, a settlement that is in the interests of the whole of the civil service and, obviously, of the taxpayer.

In research and when chatting to constituents, it was highlighted to me that at the Department for Work and Pensions, someone who is at the maximum of the lowest pay band—band B—earns between £15,000 and £18,000. To put that in perspective, a fraud officer—an individual who we expect and hope would save some money for the taxpayer over the coming years—is a band C. That demonstrates how much responsibility can reside at the lower levels of some civil service pay bands. Currently, if made compulsorily redundant, such an officer would receive three times their salary if they were older than 42 and had more than 20 years’ service. Before the court judgment, the intention was to provide such officers with the equivalent of two years’ service, and now it is to provide one year’s salary in compensation.

I am encouraged by my right hon. Friend’s statements to the effect that he is interested in negotiating at this level. I recognise the difficulties in sharing some of those concerns with the House, because it is obviously not the place to negotiate with Ministers, but I ask him, in the summing-up, to go as far as he can in sharing the objectives that he would like to achieve in the interests of people at the lower levels of the salary and responsibility grades.

I would advise the right hon. Member for Dulwich and West Norwood (Tessa Jowell), who was asked a question about the average for private sector redundancy pay, that it is in the region of £9,000, which we should recognise is less than is being offered, and in the affordability debate we need to recognise the generosity of that.

Interestingly, the 2009 civil service statistics show that 36% of civil servants earn less than £20,000 and 58% less than £25,000. Clearly, there is a need for some sort of protection at the lower levels. The Government have taken positive steps—when they formulated their policy on the pay freeze, they protected those at the bottom end of the scale, and I think that principle should carry through to this Bill and to the negotiations that my right hon. Friend is undertaking.

[Mark Durkan]

The hon. Member will recall that, when the Minister was asked to say at what level he thought people were low paid, he said he could not say. It would not be for him to say—it would be almost impertinent to suggest that outside the negotiations—but the hon. Member has rightly recalled that the coalition Government had no problem deciding that £21,000 was the threshold at which people should be protected from the pay freeze.

[Alun Cairns]

I have no doubt that that would be part of the negotiations, but I wholly accept the point that my right hon. Friend has made that one does not start negotiations at the point where one expects to finish, bearing in mind the actions that the PCS Union and some of the other unions involved have taken to date. However, the point about the £21,000 threshold that the hon. Gentleman highlighted demonstrates the compassion and support shown by the Government, and I have absolutely no doubt that that compassion and support can and will be shown towards civil servants in the negotiations that are led by my right hon. Friend.

[Jonathan Edwards (Carmarthen East and Dinefwr) (PC)]

Considering that there are ongoing negotiations, does not the hon. Gentleman agree that the Government are using the Bill effectively as a battering stick to coerce the unions during those negotiations?

[Alun Cairns]

I am grateful to the hon. Gentleman for the question, but I think the Government have been left in an extremely difficult situation—a sad situation, as I highlighted—from the outset. We have such a large deficit. A decision is needed on this question, particularly given the reforms and cuts that are likely to follow the comprehensive spending review, so I look positively at the action that my right hon. Friend is taking to resolve that position to bring certainty to those people whom I have rightly sought to champion.

18:26

[John McDonnell (Hayes and Harlington) (Lab)]

I chair the PCS parliamentary group. It is a cross-party group that was formed a number of years ago, and several Members of Parliament on both sides of the Chamber tonight are members of it. I think it has been helpful for Members of Parliament to gain a knowledge, through the union, of what the union’s members undertake, how they effect their work and the role that they play.

PCS represents the largest number of civil servants, and certainly the largest number affected by the compensation scheme, and I want to add my name to the compliments that have been paid today, across the Chamber, with regard to civil servants and the role that they play. It is an admirable tradition, serving Governments of all political colours, with commitment and dedication that is second to none across the globe. It is slightly ironic that we praise them now, and yet, by the looks of it, in a month’s time we are going to lay off and make redundant the largest number of civil servants ever in our history, as a consequence of the comprehensive spending review. Anyway, we are all committed to the existence of a civil service that implements the policies of a directly elected Government.

There are certain measures that Governments introduce that can be described as land mine Bills. Judging by the type of the legislation or their subject matter, they might appear relatively innocuous at first, but they are political land mines that can permanently damage and taint an Administration. I think the art of good governance is to identify—perhaps from bitter experience—the potential disasters, those land mines, and avoid them. This Bill is a political land mine. It is potentially extremely potent and it is an explosive issue. I think it is potentially disastrous for this Government and I think, coming at it as an ex-bureaucrat myself, that it will undermine their ability to implement their overall programme. Why? Well, many Members have commented that they have discussed with constituents and civil servants and they have received representations, so many Members will share the feeling that I have. I think morale is being affected by this legislation and the way in which it is being handled. I think morale at the moment in the civil service is at an all-time low as a result.

The Government have been democratically elected and have the right to implement their policy programme, but every manager, whether in the public or the private sector, needs not only resources and clear objectives but a committed, dedicated and motivated staff. The imposition of the Bill is undermining that morale, that commitment, that dedication, that we so need among the work force.

There is a depth of feeling about the unfair way in which people are being treated in the civil service. I have met many PCS members, including many who are my constituents, and there is resentment of the Government’s political action on this issue. The most common response that I—and, I am sure, other Members—have met is the simple statement, “We didn’t cause this economic crisis, but we’re having to pay for it with our jobs and with cuts in our conditions of service, and this is the latest round of those cuts.” There is a real, palpable sense of grievance, particularly as the bankers who did cause the crisis are not just back in position, but have, in some cases, been appointed to higher positions. Some have even been appointed to ministerial positions in recent weeks. Bankers are coming back for their obscene bonuses and obscene pay. There does not seem to be any equity or equivalence of suffering. There is a feeling among civil servants that we are not all in this together.

[Sajid Javid (Bromsgrove) (Con)]

The hon. Gentleman will know that the budget deficit that this Government inherited from the previous Government is £155 billion, but even the structural deficit, which was there before the economic crisis commenced, was £128 billion. The country was already living way beyond its means. That is why his Government tried to make changes to the scheme, and it is a reason why we need to do so. It is no good trying to blame the problem on a particular profession. If he is going to pick a profession to blame it on, he should pick the political class represented in the previous Government.

[John McDonnell]

The hon. Gentleman came to the House at the last election, so he may not know that I was probably not the most vociferous supporter of the economic policies of the previous Government. I was a critic, and if he looks at the alternative Budgets that I provided annually—which this House rejected, but never mind—he will see that there would have been no deficit if I had implemented them. There would have been a redistribution of wealth and an increase in taxation, which would have enabled us to afford the public expenditure that our society requires.

I am not a Keynesian; I am a Marxist—[Laughter.] Well, it is interesting how true some of the predictions in “Das Kapital” are coming. Even if one takes a Keynesian position, the last thing one would do at this point in time is reduce aggregate demand and cut jobs, wages and conditions of service. It flies in the face of reality to lay off large numbers of civil servants, and then cut the income and compensation arrangements that they receive. Anyway, Mr Deputy Speaker would rule us out of order if we went into another economic diatribe.

[John Hemming]

The hon. Gentleman appears to be arguing, relatively coherently, for no change whatever to the terms and conditions of public servants. Is that what he is arguing, or is he arguing that some change is reasonable? If so, what change would be reasonable?

[John McDonnell]

I recognise that a range of negotiations need to take place. In the last set of negotiations with the previous Government, there were various issues to do with changes tackling age discrimination in particular. My view—we have to come on to the reality of the negotiations that will have to take place—is that we can create a climate of opinion in this House and elsewhere that will enable those negotiations to come to fruition, and that we should protect the lowest paid, in particular, as best we can. That has been the commonly voiced demand in the Chamber today.

[John Hemming]

Does the hon. Gentleman agree that the best way to protect the low paid is to protect them from redundancy?

[John McDonnell]

Yes, and that is why I have consistently put forward alternative economic policies and strategies.

Let me press on, if I may. This is a serious debate, and I am trying to get across the feelings expressed to me through the PCS parliamentary group. As I say, I have met PCS members, I have attended meetings of the executive, I have been on picket lines, and I have been at various meetings around the country. There is anger about the proposals in the Bill—I shall come on to that—but also about the way in which the issue has been handled by Ministers.

In interview after interview, and even in the Chamber today, Ministers and Government Members have focused, in their descriptions of the compensation scheme, on payments to the highest-paid civil servants; it has almost been a portrayal of “Yes Minister”-type permanent secretaries, retiring to their Whitehall clubs on large-scale pay-offs. There are some individual examples of that, and they have been quoted today, but PCS is one of the leading unions that has pointed out that issues around high pay within the civil service have undermined the equitable distribution of rewards in the public sector.

Time and again, including today, we have had repeated the example of some civil servants receiving up to six years’ wages as a redundancy settlement. Let us get this point on the record as best we can: if I may refer Members to the Library note, of 500,000 civil servants, only 4,400 are in the senior civil service. The maximum compensation for most is capped at three years’ pay under the compulsory scheme, and two years’ pay under the flexible, voluntary scheme. For a small number of people who joined the service before 1987 with reserved rights regarding severance payments, payments are higher.

Ministers were asked by the Public Accounts Committee and, I believe, in parliamentary questions on the Chamber Floor, for information on the number of individuals currently getting a package worth six years’ salary. We were told that the information was unavailable because it could be provided only—there is a sense of irony here—at disproportionate cost. The six-year allegation is consistently used, even today. I would welcome some facts on how many people we are talking about and what the costs are.

[Martin Horwood]

Perhaps I could be of assistance to the hon. Gentleman. One of my constituents, a civil servant, calculated that to qualify for that six-year maximum, one would have had to have joined the civil service just after one’s 17th birthday and have been made redundant just before one’s 50th. I suspect that we are talking about a very small number.

[John McDonnell]

Would it not have been useful, though, if we actually had the number so that we could have a properly informed debate, rather than allegation, counter-allegation and, almost, smear?

Ministers were also asked how much public expenditure the imposed scheme would save—my right hon. Friend the Member for Dulwich and West Norwood (Tessa Jowell) on the Front Bench raised the issue again today—but that information has not been forthcoming. The Secretary of State has said that the amount is impossible to calculate. I have been there; I have advised decision makers—and in the private sector it is exactly the same—and when one is entering a redundancy situation, one does a rough, or even a back-of-an-envelope, calculation of the numbers one is looking to lose, the amounts, the average rates of pay, the distribution of the rates of pay across the service, and therefore roughly what the cost would be. That is not too much to ask before we make a momentous decision on this legislation. In fact, the Public Accounts Committee raised the issue again in July, and the Minister refused to respond.

I deal now with the myth of the highly paid civil service. Some people have already mentioned the subject today, but it is important that we get the point on the record. Even though this has been denied today, it has been part of the Government’s strategy to promulgate the myth of a highly paid civil service.

[Kwasi Kwarteng (Spelthorne) (Con)]

I am unclear about the hon. Gentleman’s position on the status quo. Does he believe that the system is sustainable at current levels, given the economic climate?

[John McDonnell]

I believe that people who are made redundant should be properly compensated and, yes, I believe that the system put forward by the last Government was certainly affordable. I actually believe that the mechanism previous to that is still affordable. However, I accept that there was a need for reform. That is what the unions were negotiating on. It was not the PCS’s fault that the last scheme fell apart; the Government ruled that the process by which it was introduced was unlawful—it is as simple as that.

Let me return to the myth of a highly paid civil service that is promulgated, if not today, certainly elsewhere, including by the media. Yes, there are some highly paid civil servants, and we have dealt with that today. The unions themselves are at the forefront of highlighting the need to tackle high pay and bonuses. However, as had been said, the average civil service pay on which redundancy payments are based is £22,850 a year, compared with £24,970 in the private sector. There are 35,000 civil servants who earn less than £15,000 a year. Some 210,000 people—40% of the civil service—are paid £20,000; 350,000, less than £25,000. The bulk of our civil servants are on low or relatively modest pay.

The other tactic that is used—and it has been paraded again today by Ministers and Members in the debate—is a justification of the attack on the compensation scheme by divide and rule, playing public sector workers off against private sector workers. The Government have argued that many people in the private sector receive only statutory minimum redundancy payments or low-level additional scheme payments, but the reality is that most private sector workers are covered by some form of additional scheme, and are usually protected by its being written into their contract of employment. The fact that the level of many of those compensation payments is disgracefully low in some parts of the private sector is no justification whatsoever for undermining standards in the public sector. It is an argument for raising levels and standards in the private sector, even in these economic times.

The argument that when civil servants take on their job they weigh up the merits of going into the public or private sector has been made today. Wages in the public sector are lower, but the benefits are better, and usually more secure—that is the calculation that is made. If we compare civil service grades with jobs in the private sector, we can see that admin officers in the civil service earn 21% less than people in comparable jobs in the private sector.

[Sajid Javid]

I thank the hon. Gentleman for giving way to me again. The latest report by the Office for National Statistics in 2009 stated that the median weekly salary in the public sector was about £540 versus £470 in the private sector.

[John McDonnell]

I shall refer the hon. Gentleman to the figures, so we can base the debate on them. I repeat: average civil service pay is £22,850 a year compared with £24,970 in the private sector.

[Sajid Javid]

The hon. Gentleman might want to pick up the report from the House of Commons Library which contains the exact numbers: £539 a week in the public sector versus £465 in the private sector.

[John McDonnell]

I will not quote the figures again, but I refer the hon. Gentleman to the income data survey. I am happy to provide him with a PCS briefing that sets out the figures. [Interruption.] Well, the briefing is based on information independently issued by the income data survey.

In the executive grades, supervisors in the public sector—people with vocational qualifications—earn 18% less than supervisors in the private sector. The decision to go into the public sector, as I have said, is based on a judgment in the round about security, benefits, pensions and, yes, redundancy payments, which are described as accrued benefits that people earn over time. They are part of their wages. What is happening today is a Government unilaterally tearing up the contract that was entered into when many of these civil servants entered employment. I think that that will be open to challenge on the grounds of human rights compliance. Inevitably, members not just of the PCS but of other unions will wish to exercise their rights in law. What is happening is the worst of all worlds for civil servants.

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

Does the hon. Gentleman believe that it is fair or affordable in the current economic situation for anyone to be given six years’ pay as redundancy pay?

[John McDonnell]

Perhaps the hon. Gentleman was not listening. The period of six years has been used time and again to justify the measure. A tiny number of cases are involved, but we would like the exact number. If he can help us to extract that information from his own Ministers, that would be useful.

The vast bulk of civil servants who have been made redundant have been laid off on conditions of no more than three years’ pay, and the majority of them on considerably less. Under the terms of this measure, that will be reduced by two thirds. It is not about the tiny minority who receive six years’ pay, but about the vast majority who will lose up to two thirds of their payment.

[Matthew Hancock]

rose—

[John McDonnell]

I will press on, and give way to the hon. Gentleman shortly.

The position now is the worst of all worlds for civil servants, who are facing a double whammy. They enter a service in which they are paid less than the private sector, but at least they receive some benefits as a result of the security of pension and redundancy payments and so on, but their redundancy payments are to be cut while at the same time their pay is frozen or cut.

There is no protection in the Bill for the low-paid—we all agree about that. Members have appealed for details, but the ministerial response is that this is not the place to begin negotiations. The Bill begins negotiations, and it is a negotiating ploy. The Minister could at least set out the parameters or the options available to protect the low-paid. The argument goes that that will be negotiated with the unions in separate negotiations, but do Members of Parliament not have an additional responsibility to represent the interests of their constituents? When hon. Members vote on the Bill, they need security of information to protect their constituents’ interests. They need to know in more detail how their low-paid constituents will be protected as a result of the legislation. However no fragment of information has been given, nor have parameters been set by the ministerial words we have heard today.

When we deal with legislation of this sort, we need to consider the impact on people’s lives. The worst feature of the Bill is the Government’s almost brutal disregard of the human consequences. Tens of thousands of civil servants are likely to lose their job in the coming years. In the economic crisis, even if there is no double-dip recession, and we just rattle along the bottom for the next three years, most of those people will struggle to get back into work at all or find work offering similar wages. If we look at previous recessions, particularly for older workers, we can see that some of them never work again. We must recognise the devastating impact that that will have on individuals and families.

Most people in this country lack savings. Various reports by citizens advice bureaux show that even people in work lack savings beyond a month’s salary or wages. Most people have enough for only two months’ mortgage payments, so are close to default. Reducing redundancy payments in this way undermines people’s ability to survive the devastating impact of losing their job. It also undermines their ability to get back into work in many instances, because it is a costly exercise to travel around the country looking for work. The measure will introduce poverty and stress, and put pressure on people who have lost their job. The irony is that whatever savings are found will be significantly reduced by the benefits that we pay out. Many of the people we employ to administer unemployment benefits will receive those benefits themselves as a result of cuts in public expenditure.

Many of the PCS members I meet are desperate as a result of the anxieties engendered by the Bill, and they are becoming angry. When people perceive that an injustice has been done to them, they react. Boiling point has been reached as a result of the autocratic methods used by the Government to impose their way. They have introduced legislation before serious negotiations have taken place. It is like putting a cosh on the table before beginning a dialogue. The use of the money Bill device to prevent full parliamentary scrutiny is despicable. I have looked at “Erskine May”, and I urge other Members to do so. I cannot see how this can be defined as a money Bill. I hope the Speaker will rule against it after Third Reading. If it is passed as a money Bill, it will be implemented within a limited time scale, with no potential for amendment in the other Chamber.

The introduction of a sunset clause sends out a message that if the economic situation worsens, the Government will come back for more, and there will be further cuts in the scheme after that year. The Bill immediately soured the industrial relations climate under the new Government, and that does not apply just to the civil service. Across the public sector teachers, local government workers, health workers and those working in the emergency services are all on better terms than the terms introduced by the scheme in the Bill, so they see the legislation as the starting gun for an attack on their conditions and their redundancy payments.

Some have put a more sinister construction on the Government’s intentions. It is clear that the Government’s strategy is that the economic recession will be solved on the basis of cuts in the jobs, services, wages and conditions of employment of working people. For those of us who have been around a while, it smacks of the same old policies of the 1980s. In that period a Conservative Government decided that the unions had to be broken if the Government were to be able to force through harsher cuts. They took on the miners’ union, for which I worked at the time. It was an attempt to break a union as an example to others. The present Government appear to have identified the group of public sector unions as the modern day target. I am sure we will soon be hearing statements about enemies within and so on.

If that is the Government’s strategy, they are sorely mistaken. My sense is that the public servants who will be affected by such legislation will not take it lying down. Members have been lobbied already. They are aware of the growing anger, and there will be resistance. That will have public support, particularly as our communities begin to experience the impact of the cuts to their services and increasingly appreciate the scale of the damage that will be incurred by our society.

I appeal to the Government to pull back from this mistaken approach of imposition, which will lead to confrontation. I urge them to get back to the negotiating table and to agree a serious and sensible way forward. They should take the cosh of this legislative proposal off the table to allow proper negotiations. Ministers could sensibly withdraw the Bill tonight. Failing that, I urge Members to reject it because there is nothing in the Bill or in the words uttered by Ministers today that gives us the guarantee of the protection of our constituents that we require. The Bill will damage the civil service that we have all commended in today’s debate as an exemplar to the world.

I warn the Government that issues such as those raised by the Bill, which appear minor at first glance, become the combustible material that eventually brings down a Government. I urge Members to reject the Bill tonight.

[Several hon. Members]

rose—

[Mr Deputy Speaker (Mr Nigel Evans)]

Order. A considerable number of Members are trying to catch my eye, as the House can see. If speeches go much beyond eight minutes, we will not get everybody in, so I ask Members to focus and show discipline in order to help other Members to be able to deliver their speeches also.

18:53

[Dr John Pugh (Southport) (LD)]

I shall be fairly brief, as I have only one fundamental concern. Despite the persuasive skills of the Minister, I sensed in what he said the iron fist within the velvet glove.

I have concerns about the scheme which focus on the fundamental issue of a unilateral alteration of contract and how that stands in this place. I accept that the scheme as it stands is, as many hon. Members have said, generous. It is certainly superior to any available to other public sector workers, such as teachers, NHS staff or local government workers. It is expensive and everybody accepts that it needs an overhaul. I am aware that successive Governments, worried about affordability, have sought agreement on changes and got very close to agreement, which must give some hope for the future.

What I have difficulty with—it is a genuine difficulty, and perhaps the Minister can help me—is a unilateral variation of contract in any context, and not because it is ruled out, as it was in the courts, by the Superannuation Act 1972, which Parliament is, of course, free to amend, and which we are in the process of amending here. Let me briefly explain why. The scheme as I see it is referenced in civil service contracts of employment. Those contracts are freely entered into by the state and by the employees who work for the state. The scheme therefore features, though not in specific detail, as a term and condition of that contract.

When an employment contract is ignored or discarded by any other employer, there is normally a redress in law. Some unscrupulous employers view that as an occupational hazard, preferring to pay people off with meagre compensation than to honour contracts. That is a calculation, but it is not something that a Government should engage in. Such people belong to what I would call the brutalist school of management, and working for such people is a unhappy experience. The hon. Member for Hayes and Harlington (John McDonnell) mentioned how things could go in the civil service.

The state should, in theory, be a model employer, and legislates in this place on employment law for other employers. What we have here, apparently, is the courts telling the civil service that they cannot vary a contract unilaterally as a result of action by the previous Government, and this Government legislating to ensure that they can. However it is dressed up, that represents the naked—albeit legal—use of power to alter a contract unilaterally. Such managerial brutalism, as I call it, is likely to have long-term detrimental consequences, in terms of morale and the willingness of employees to engage satisfactorily in their employment.

Leaving aside the fact that this sets a poor example, there is a danger that it may also be poor politics. Good politics is based on ethics, and who wants to defend breaking contracts at one’s convenience? To be sure, keeping to them in this case costs money—Members have spoken about affordability—and more money than people ever thought it would. We do not argue in this place that because private finance initiative contracts cost much more than imagined, we should pass legislation to drop some of their clauses, but that strikes me as an exact parallel of what the Bill appears to do.

Keeping contracts is fundamental to any scheme of law. Even when football teams that are saddled with managers who drag them down into lower divisions finally come to sack them, they honour contracts that they have made with them, sometimes at huge cost: they keep the terms and conditions of their contract. We do not hire people to work on our premises or our houses and, when our bank balance declines and our fortunes get worse, insist on paying them less than agreed, unless we have some sort of justification. Only in the direst national emergency can a democratic Government sacrifice the principle of honouring contracts, and they should do so only when there is no alternative course of action.

I genuinely appreciate the Government’s dilemma. I wish to see the scheme reformed to become more affordable, at less public cost. We must all accept that since 1972 the scheme has grown and grown, and there might be a difference between reneging on the scheme and varying some detail of it, but that is a legal question above my pay grade. I do not seek to answer whether that difference exists, or to create difficulties for anyone. I simply want to know whether the Bill before us is in effect a unilateral variation—a rewrite of a contract. If it is, how in this case can we provide a wholly rational and ethical defence for it?

19:09

[Mr Michael McCann (East Kilbride, Strathaven and Lesmahagow) (Lab)]

May I declare an interest? In the Chamber tonight, I am representing thousands of civil servants who live and work in my constituency, home to Her Majesty’s Revenue and Customs, the Department for International Development and the Department for Work and Pensions. Many other constituents work in the Scottish Court Service, the Scottish Prison Service, the Forestry Commission and many other Departments, agencies and non-departmental public bodies throughout Scotland.

I have another interest to declare: I was a civil servant between 1982 and 1992; I became a full-time official with the Civil and Public Services Association, a predecessor of the Public and Commercial Services Union; and then I became a senior full-time official for the PCS. I know all the protagonists in this debate very well indeed, including the aforementioned Mr Serwotka.

The motto of the new coalition Government is, “We are all in this together,” and I should like to put that to the test by asking them to put their motto into actions rather than words, because, despite what was said amid the heady atmosphere of the Queen’s Speech debate, every Member recognises that we have to tackle the fiscal deficit. The difference—well, there may be more than one—between Opposition and Government Members is how we do so. The Opposition believe that there are other options, that the Government are going far too far, far too quickly and that the damage that occurs will create more problems for the economy.

The proposal before us is the first real acid test of the Government’s plans for deficit reduction, because we all know that the whole economy of the United Kingdom benefited from the economic bail-out. The private sector, the public sector and what people call the third sector all benefited, and in order to reduce the deficit every part of the economy must contribute. I shall argue strongly that that contribution must be proportionate and depend on how much people can afford. For example, the bankers, who perpetrated the biggest crime against our country’s economy, must pay the most in order to rebalance our books.

We know from the Budget that people will be asked to pay a 20% VAT rate, and that there will be what Opposition Members regard as a puny levy on the banks. We must also consider the proposal before us, and taking matters in the round I have reached the judgment that we are not all in this together, because we are asking those who can least afford it, those who are vulnerable and public sector workers to pay the largest price. That is the collective impact of the proposal. Despite what the Minister said, that is the message that the Government are sending out. I appreciate his point about the negotiations, but, having taken part in many negotiations over the years, I now recognise when I had the upper hand and when the employer did, so I recognise that in the current negotiations the employer—the Government—has very much the upper hand.

Ministers still have an opportunity to reach a common-sense resolution for the civil service compensation scheme, however. A lot of inaccurate information has been put out in the press, and there is a great deal of confusion about the difference between severance and early retirement. For example, on the BBC’s “Today” programme, I heard that some civil servants would receive six and two-thirds years’ payments after they had been made redundant. That clearly confused severance with retirement, because severance is simply based on length of service and salary, and the maximum payout under the current CSCS scheme is three years. In respect of retirement, the terms are for the over-50s, involving an enhancement, through added years, to their pensions.

The Labour Government’s comprehensive proposal to the civil service unions would have saved between £500 million and £650 million—not inconsiderable amounts of money, I hope Government Members will agree—and protected all the different bases in respect of early severance and early retirement.

[Harriett Baldwin (West Worcestershire) (Con)]

I want to clarify the hon. Gentleman’s point about severance, because the Library research paper states that early severance can cost “6 years’ pay” under the 1987 terms. Is that the case?

[Mr McCann]

The hon. Lady is absolutely correct, but earlier contributors made it clear that that refers to a very tiny proportion of the civil service staff; the vast majority are under the terms that I have given the House—[Interruption.] The hon. Member for West Suffolk (Matthew Hancock) shakes his head, but it is absolutely true that the vast majority will receive severance terms based on a maximum three years’ payout. [Interruption.] His colleagues nod in agreement, so he seems to be in the minority.

[Matthew Hancock]

The surprise that I express is due to the argument that, because not many people will receive enormous payouts, there is somehow not a problem. I also want to add a couple of facts to the debate. In the past three years at the Department of Health, the average payout has been more than £100,000 each year. The argument that large payouts amount to a couple of small examples contravenes the facts.

[Mr McCann]

I thank the hon. Gentleman very much for that intervention, but he is simply wrong. A minute number of individuals will attract substantial payments; the vast majority will receive a maximum three years’ payment under severance terms and, for early retirement, up to six and two thirds added years. The Minister nodded when I mentioned that the maximum is a six and two-thirds years’ enhancement.

The most important thing about the February 2010 proposals that the previous Labour Government put forward was that they would have protected the lowest-paid civil servants. The cap was two years’ salary, with a maximum payout of £60,000, but given that the average salary of a civil servant is £20,000—that figure has been bandied about a lot in the debate—Labour’s proposals would have protected those individuals. Under the Bill, they face a two-thirds cut, which is unreasonable and, with the greatest respect to Government Members, demonstrates that we are not all in this together. The Bill anticipates that, as a result of the comprehensive spending review, many thousands of civil servants will be made redundant in the months to come, and it effectively says, “While we give you the pain of making you redundant, we’ll also hammer you financially as you walk out the door.” That is unacceptable.

[Richard Graham]

Does the hon. Gentleman agree that his comments are focused on the Bill, rather than on the parallel aim of the negotiations with the trade unions? The fundamental aim of those talks, which is to increase the minimum statutory amount for the less well paid civil servants, is critical and fair. Does he support it?

[Mr McCann]

I understand the hon. Gentleman’s point, but may I make this point in return? If the February deal was unacceptable to one trade union in the negotiations, it strikes me as logical that that deal would have to be significantly improved in order to make it acceptable to the PCS. I do not get from the Minister any impression that there will be any significant move to improve that deal financially, which leads me to conclude that those negotiations might not be as fruitful as Government Members hope.

[Richard Graham]

Does the hon. Gentleman support the concept of making the proposal to the trade unions more attractive to the lower paid, even if it is less attractive to the better paid?

[Mr McCann]

One of my final points is that the February deal should be put back on the table. That is the simple fact of the matter. That deal represents the best opportunity to reach an agreement, as the shadow Minister, my right hon. Friend the Member for Dulwich and West Norwood (Tessa Jowell), said.

The Minister said that the Government have proposed a 15-month deal for those who volunteer for redundancy, and from a negotiating point of view I can understand why that might seem attractive, but it will not be attractive to the many low-paid civil servants who work in my constituency. They will see it as a pearl-handed revolver to the temple, implying that they can take 12 months’ pay if redundancy is compulsory, but 15 months’ pay if they go quietly. That is not fair to civil servants.

I gave an example when I intervened on the Minister. Let us take a 42-year-old civil servant with 20 years’ service—I have chosen that age because it is, almost, close to mine. Under the current, pre-February deal, which is in place because, owing to legal action, the legislation has not changed, that individual would receive £60,000. Under the February proposals that the Labour Government put forward, that individual would have received £58,000. Under this Bill, they would receive £20,000 in compulsory terms or £25,000 if they went voluntarily.

[Dr Thérèse Coffey (Suffolk Coastal) (Con)]

I respect the hon. Gentleman’s argument, but on a point of clarity, I should say that he talked about a 42-year-old who had worked for 28 years. That suggests that he or she would have started work at 14. I would have a bit more understanding if the hon. Gentleman used a more realistic example.

[Mr McCann]

The hon. Lady should forgive my accent; she probably did not catch it, but I said 20 years’ service. That should clear it up. My example was a 42-year-old civil servant who had worked for 20 years. Is that okay?

[Dr Coffey]

indicated assent.

[Mr McCann]

The numbers are okay. Forgive me; I was not trying to suggest that we introduced new legislation in Scotland under which people started work earlier. My point is that the lowest-paid are still paying the biggest price. That is unfair, and I hope that Government Members will take that on board.

A number of people have said in this debate that the private sector does not get the same treatment. I was a full-time negotiator for the Public and Commercial Services Union and its predecessors for many years, and let me tell the House what happened in the public sector. When times were good and we went into negotiations asking, Oliver-style, for more, we got the answer back that we had to set an example. We could not share in the country’s wealth because of that. When times were bad, the argument from the opposite side of the table changed—it became, “We can’t afford it.” That is why the civil service has been a battleground for a number of years.

Sadly, I am old enough to remember the 1980-81 pay disputes. In the late 1980s, Margaret Thatcher, the then Prime Minister, put new arrangements in place. Those were ripped up in September 1992 when we had to pull out of the disastrous exchange rate mechanism. In 1993, the Conservative Government imposed a 1.5% pay limit on the whole public sector to take account of their economic problems. I mention all that to demonstrate the link between Conservative Governments and cuts to the civil service and the fact that the civil service is always the easy scapegoat.

There is always a dilemma between the public and private sectors. We were trying to emulate in some way the private sector’s efficiency—there is an eternal debate about how we can make the public sector more efficient. The conundrum is this: the private sector can make a profit, but the public sector is about service and delivery. The public sector must always be efficient, but low salaries are the price that public servants are prepared to pay in return for better terms and conditions of service. That is the simple fact of the matter.

[Nick de Bois]

My hon. Friend the Member for West Suffolk (Matthew Hancock) highlighted the fact that there is little difference between weekly salaries in the private and public sectors. How does the hon. Gentleman equate that with his argument that a differential has been growing?

[Mr McCann]

The simple fact of the matter is that I can pluck any statistic out of the air that will disprove that. When I was a negotiator, I used the retail prices index, RPIX, the consumer prices index—whichever best backed up my claims on behalf of my members. That is the simple fact of the matter. I respect the fact that the figures come from the Library; I do not doubt them at all, but I could quote other figures that would support my argument, and mine are more accurate.

[Gregg McClymont (Cumbernauld, Kilsyth and Kirkintilloch East) (Lab)]

My understanding is that the Government’s figure was from 2009, with no other years being considered. I am sure that my hon. Friend will agree that 2009 was in the midst of the deepest recession since the 1930s. At that stage, the private sector had taken the real hit, which perhaps explains what a statistician would describe as an “outlier figure”. Most statisticians and statistics would suggest that there is a pay premium in the private sector; that has been established over 30 or 40 years. To cite figures from only 2009 is a little naughty.

[Mr McCann]

I shall defer to my hon. Friend’s greater knowledge of these matters and get back to the point that I was trying to make.

Public sector workers take poorer salaries in return for more reasonable terms and conditions. When things go pear-shaped, they expect reasonable protection. Things have gone pear-shaped without a shadow of a doubt; the problem is that the safety net that public sector workers thought was there is going to be withdrawn. Ministers can do the right thing, and I hope that they take heed of my arguments and those made by some other Members.

To demonstrate his desire for fairness, the Minister for the Cabinet Office said in a sitting of the Public Administration Committee:

“Our view was that had the scheme that was introduced by the last Government, which was diluted as the negotiations went on, I understand, in order to secure the agreement of all of the unions, including PCS, remained in place then there would have been a very pressing case made for us to retain that and work with that.”

The right hon. Gentleman should take that position away; he should drop the Bill and move back to the February 2010 proposals as a basis on which, hopefully, negotiations can be concluded.

What worries me is that in that same sitting, the Minister also said:

“the truth is that there are significant numbers of people within the Civil Service for whom through no fault of their own but simply because of the way life has moved on there is no job in reality but who are not made redundant because the terms are prohibitively expensive at the moment.”

With the greatest respect, that is arrant nonsense. I have visited Government Departments, agencies and non-departmental public bodies the length and breadth of the country, and I have never seen highly paid workers sitting around doing nothing. I do not believe that what the Minister said is accurate and I hope that he will withdraw the comment. He should know that 40% of civil servants earn £20,000 or less and four fifths earn less than £30,000. It is for the right hon. Gentleman to tell us in which Departments these people are sitting around doing nothing and earning money.

The trade union position is another stumbling block that we cannot hide from in this debate; it is important that that should be covered as well. The fact is that five of the six trade unions backed the February 2010 deal and that the Public and Commercial Services Union rejected it. To the Public Administration Committee, the PCS said that half of its 300,000 members—the higher-earning members—would lose out because of that deal. I fully understand the concerns, but then I look at the other trade unions involved in the negotiations—the FDA and Prospect, for example. The FDA represents the most senior civil servants in the United Kingdom and Prospect’s predecessor unions have represented professionals, managers and scientists, who are more highly paid. Both those trade unions accepted that they had to make some compromises in the negotiations under the last Labour Government. They probably reached the conclusion, before the words were said by Government Members, that “we are all in this together” and that the public sector also had to make a contribution to the rebalancing of the economy.

The PCS rejected the deal, took legal action and stopped it. However, they stopped it not only for their own members but for all the trade unions that are part of the Council of Civil Service Unions. Now, this Bill tells us that all bets are off. The Minister for the Cabinet Office states that had that deal been accepted, this Government would probably have honoured it. He then offers a significantly poorer deal, which is linked to future negotiations. The Minister may feel that there is an opportunity to save more money or to humiliate the PCS for what he might perceive to be its exceptionally foolish action.

[Gavin Williamson (South Staffordshire) (Con)]

With hindsight, does the hon. Gentleman think that the PCS should have accepted the offer in February?

[Mr McCann]

I always tend to go with the majority; that is the democratic thing to do. When five out of six trade unions accept a deal, that tells us something. I would have taken the view that the majority position should have won through.

[John McDonnell]

For the sake of accuracy on the record, I should point out that the vast majority of members affected are PCS members; the numbers from the other unions are relatively smaller. Actually, when balloted, 63% of PCS members affected voted against the proposal for the scheme and in favour of industrial action.

[Mr McCann]

My hon. Friend is correct that 70% of those covered by the negotiations were PCS members, but we should bear in mind that 150,000, or 50%, of them would have been protected by the Labour Government’s proposals. It is also dangerous to go down the line of citing figures from ballots because we then tend to look at how many people voted in them.

[John McDonnell]

Just to be accurate for the record, it was one of the highest ballot turnouts that any union has had. The turnout was excellent.

[Mr McCann]

With the greatest respect, I do not think that people should worry about numbers—we need to go to the meat of the debate, which is about protecting low-paid civil servants who would be disproportionately affected by the proposals.

The Minister may feel that the PCS has been foolish. He may feel that he wishes to take advantage of the PCS’s vulnerability at this time and punish it. I genuinely urge him not to do so, because we anticipate a hard time for civil servants, many of whom may be made redundant as a result of the comprehensive spending review, and it would be vindictive in the extreme to hit them with the double whammy of redundancy and then a poor redundancy payment to boot, and to strip them of the hard-won conditions of service that they had.

You will be delighted to hear, Mr Deputy Speaker, that I am now going to sum up. The February 2010 deal was a fair deal, in my view. It saved money, it protected the lowest-paid, and it covered the protection of civil servants’ redundancy payments and early retirement provision. We should not be attempting to punish members of the five trade unions who backed the February 2010 deal, nor should we punish PCS members, even if Ministers believe that the PCS strategy was somehow misplaced. To use the motto of Government Members, if we are all in this together, we should be fair to civil servants. We should put the February 2010 deal back on the table, legislate for those changes, and get the deal done. Then, we can ensure that all public servants who work in the civil service are protected properly.

[Several hon. Members]

rose—

[Mr Deputy Speaker (Mr Nigel Evans)]

Order. The hon. Member for East Kilbride, Strathaven and Lesmahagow said several times that we are all in this together. We are all in this debate together, and if everybody takes about 20 minutes, we will get fewer than 10 Members in, so please be focused. We have not introduced a time limit on this debate, but if it carries on like this, I will have no hesitation in doing so.

19:19

[Mr Bernard Jenkin (Harwich and North Essex) (Con)]

I am grateful for that comment, Mr Deputy Speaker, and I will truncate my remarks as best I can. Perhaps it is just an irony that the PCS is the single union that held up the agreement and a representative of the PCS held up the debate for 21 minutes after being implored to speak for only eight minutes. I reflect on that.

The Public Administration Committee, which I chair, recently took evidence from my right hon. Friend the Minister for the Cabinet Office and the principal civil service unions about the provisions of the Bill and the prospects for a negotiated settlement of the dispute about ongoing compensation for civil servants who are forced to leave their jobs or voluntarily accept redundancy. The hope then was that the parties would reach a negotiated settlement, but regrettably that settlement has not been reached.

It is appropriate at this stage to remind ourselves of why we are having this debate. We are here because there was no agreement. The agreement reached with the five other unions by the previous Government was challenged in the courts, and we finished up with the courts ruling that the compensation payable represents legally enforceable rights. That was never the intention of the original legislation, and that is why we have this Bill. We are not undoing previous legislation; we are undoing the work of the courts on previous legislation. In my view, it is about the culture of judicial review and judicial activism that we now live in. It is unfortunate but it is where we are.

Let us have no illusions about why this is necessary from an economic viewpoint. We are facing the worst public expenditure crisis since the 1930s. It is inconceivable that compensation arrangements that were reached as part of voluntary arrangements between Government Departments and civil servants, and have become legally enforceable by accident, should be respected as though they were contracts entered into and signed in blood. I do not accept what the hon. Member for Southport (Dr Pugh) said about these arrangements. They were intended to be flexible and negotiable, and the Bill is attempting to restore that position, albeit now putting in place a statutory baseline that is harsh—let us have no illusions about that. It is sobering to reflect how harsh these arrangements are in comparison with the existing arrangements.

[Michael Connarty (Linlithgow and East Falkirk) (Lab)]

Will the hon. Gentleman give way?

[Mr Jenkin]

I hesitate to give way because we are very short of time, but I will do so briefly.

[Michael Connarty]

This is obviously a very brief Bill, and the hon. Gentleman will have read it; I have read it also. Could he tell me where it says that this is in any way negotiable and flexible?

[Mr Jenkin]

The hon. Gentleman misunderstood me. The Government have made it clear that they want a negotiated settlement, and that they are not prepared to talk about the terms of that settlement in this debate. Obviously, however, what we enact here provides a legally enforceable baseline that ultimately is not negotiable—the hon. Gentleman is quite right. The point is that the Government have made it absolutely clear that they want a negotiated settlement. With five of the six unions having negotiated in good faith, I hope that the PCS will also do so, whether or not the Bill passes on to the statute book and comes into force.

The need to reform the civil service compensation scheme is well understood. In fact, all the evidence that we received from the trade union representatives conceded that we need to deal with it as a matter of urgency in the current economic climate. This short Bill is simply a reflection of the accumulated mess that successive Governments and successive decisions in the courts have got us into. If there is one thing I regret, it is that there is not more understanding from the official Opposition of the mess that they were in on this same subject and that we cannot present more of a united front, but that is the prerogative of opposition and our democratic process, and I respect that.

I have two particular concerns about the Bill, and I would be grateful if the Minister could address them when he winds up. The first is technical and raises an important issue of principle. Clause 2 provides for early termination or an extension of the 12-month applicability of the legislation. Of course, sunset clauses are not unknown, and in many respects they are welcome provisions because they provide an opportunity to declutter the statute book. However, this Bill is unusual in providing what one might call a “sunrise” clause whereby, if desired, the legislation can be revived by an order under the affirmative resolution procedure in this House. The only similar provision was made in relation to section 13 of the Prevention of Terrorism Act 2005. I worry that the matters in this Bill are hardly in the same category, and that the ability of this House properly to control the law is being excessively compromised for nothing more than the managerial convenience of the Government. Can the Minister explain what the special circumstances are that justify such a provision in this case?

Secondly, I should like to focus on the possibility of a further legal challenge to the provisions of the Bill given the High Court’s decision to quash the earlier agreement. In his judgment, Mr Justice Sales took the view that compensation payments under the scheme should be taken to be accrued rights in the same way as pension entitlements. In his answers to me about the Bill’s compatibility with the European convention on human rights, the Minister for the Cabinet Office was, if I may say so, not entirely persuasive that he had addressed the legal point made by the unions and potentially to be made in a future action. The PCS argues that the Bill is unlawful because it offends against the principles of the ECHR, namely that the legitimate expectations about compensation rates that the current state scheme gives rise to, are legally possessions of which individuals cannot be deprived.

In the explanatory notes, the Government declare the Bill’s compatibility with the Human Rights Act 1998 because payments under the civil service compensation scheme cannot be considered to be a possession. In any case, they say, even if they were to be considered possessions, since the cap on compensation rates does not apply until a redundancy notice is issued or a voluntary departure is agreed—that is, after the Bill has come into force—it does not therefore amount to the deprivation of an existing possession. That is all very elegantly argued, and no doubt the Government have had the benefit of legal advice, but if the Bill is enacted and subsequently challenged in the courts, the consequences could be extremely significant. Even if the challenge were not successful, if it went to the European Court of Human Rights for a determination, the delay and dislocation would be considerable. How sure is the Minister that the rights generated by the legitimate expectation of civil servants about their terms and conditions with regard to redundancy payments will not be regarded as possessions?

I understand that there is case law in the ECHR suggesting that mere claims to possessions are capable of being interpreted as property rights when there is sufficient basis in national law, for example when there is settled case law in the domestic courts confirming that. Precisely that confirmation was provided in the case that was adjudicated in May. Is the Minister confident that, even if the accrued rights are considered possessions, the Government are justified in interfering with those rights in the wider public interest, and therefore lawfully able to do so? In short, is he satisfied that the unions will not have a claim against him for not exercising his discretion in a fair and proper manner in failing to recognise existing entitlements?

That is an important matter, not some arcane point. A legal challenge could run for a very long time in Strasbourg, perhaps for years, and if the Government lost having gone ahead with job reductions on the terms set out in the Bill, it would potentially saddle the public purse with a huge liability at some future date, to say nothing of the subsequent complications in trying to repay individuals long after the event. I point out that Governments of both parties have a long history of wishful thinking when it comes to such cases. I speculate that it appears that the easier course in the short term is often to risk defeat in the courts sometime in the distant future rather than to confront the legal realities and their implications immediately. That is not conducive to better governance and decision making, and if it continues to happen under this new Administration there will perhaps be a case for the Public Administration Committee to launch an inquiry into why the Government’s legal advice has so often proved deficient in such cases. I place the Government on notice about that.

Subject to those qualifications, I support the Bill and will vote for it. What Ministers do will be taken as a reflection of the regard in which the civil service is held, and that will have an effect on the morale of the public service at a time of great uncertainty and change, and therefore on this Government’s relationship with civil servants. Nobody listening to this debate can be under any illusion about the seriousness of the measures that we are discussing and the impact that they will have on people’s lives. I commend many of those who have spoken from both sides of the House for alerting us to those concerns.

19:32

[Jack Dromey (Birmingham, Erdington) (Lab)]

May I declare an interest? For 15 years I was chairman of the Ministry of Defence joint industrial Whitley council, which at its height covered 120,000 industrial civil servants. It was the only body in British industrial relations that survived the 18 years of a Conservative Government with a Minister in the chair, such was the emphasis on good industrial relations in a very sensitive Department. I know from my own experience that the armed forces value greatly the outstanding service given by defence civilians in the Army, Air Force and Navy. A colonel in charge of one of the biggest army bases in Europe once said to me, “Jack, we pay them poorly, but at least they can look forward to a decent pension and, if they lose their job, a good redundancy payment.” That historic assumption is now being torn up.

Who are the civil servants about whom we are talking? Reference has been made to those who work in customs, in the UK Border Agency, in the issuing of driving licences and in air traffic control, and I will give two additional examples. First, only two weeks ago I was in the Jobcentre Plus office in Erdington High street, which covers the area with the highest unemployment in Birmingham but is the highest performer. There were excellent young men and women there working with a passion to help the most underprivileged in a deprived community back into work. The other example is people I know very well from my own experience, the defence civilians at RAF St Athan who, right now, are working hard to support our troops in Afghanistan. They are typical of those who have historically worked in the Ministry of Defence—loyal, long-serving employees, many of them ex-service personnel.

There are 35,000 civil servants in the west midlands, and I want to dispel the myth that they are well paid and have gold-plated pensions and secure jobs. They are mostly low-paid people whose wages have fallen behind inflation. Their average pension is £4,200 a year, and 100,000 civil servants have lost their jobs. Can we have a debate based upon the facts, not the myths?

On the myth that civil servants are well paid, 40% earn less than £20,000 a year and 63% earn less than £25,000 a year. In the Department for Work and Pensions, the lowest-paid get but £13,000 a year. Yes, there was the IT director on £249,000 a year, and that was absolutely wrong, but can we stop using the exception to have a go at civil servants as a whole? On the myth that civil servants enjoy gold-plated pensions, I have already said that if we exclude the highest-paid, the average pension is £4,200 a year, and 100,000 retired civil servants have a pension of less than £2,000 a year. On the myth that they are in secure employment, 20,000 jobs have gone in HMRC, 30,000 in the DWP and 25,000 in the Ministry of Defence, and many more now face losing their jobs, particularly as we look towards the comprehensive spending review.

Reform the current arrangements? Yes. Negotiation to that end? Without hesitation. But it is fundamentally wrong, and a very dangerous precedent, for Government to impose unilaterally on any group of employees changes that are detrimental to their terms and conditions of employment. It is wrong to compare what is now on offer with what was on offer from the Labour Government. Somebody on the median salary of £22,500 a year who has been employed for 20 years and is made compulsorily redundant will suffer a cut of £37,500 in what they would otherwise have expected. That is a broken promise to people who had accrued rights on which they depended, which the Bill is taking away from them at a stroke.

It is wrong that there is no protection in the Bill for the lowest-paid. I heard the Minister’s Delphic statements earlier about his hope and expectation, but there is nothing to support them in the Bill. It is wrong and bizarre that somebody who is made compulsorily redundant will now receive less compensation. I know, from my years negotiating in the industrial civil service, about what used to be called public interest terms, which were associated precisely with compulsory redundancy. The Minister said earlier that he knew of no other such examples, but it is common in the private sector that there are enhanced terms for redundancy but yet further enhanced terms for compulsory redundancy.

It is also wrong that, without negotiation or pre-legislative scrutiny, the vehicle of a money Bill is being used in this way, and it is a dangerous precedent. If yesterday we saw a constitutional outrage—a gerrymander—today we see a contractual outrage, the unilateral dashing of the hopes and expectations of hundreds of thousands of civil servants.

I return in conclusion to RAF St Athan, because the workers there working day and night in support of our armed forces in Afghanistan are themselves facing redundancy. I know many of the individuals concerned, and they are trying to plan their future. Now, at a stroke, what they had hoped for will be taken from them in this Bill. They are not responsible for the misdeeds of bankers, and they resent the peddling of myths about civil servants, as they will resent, in the words that the Minister used today, the use of a “blunt instrument” against good men and women who have served this country well and deserve dignity and respect, but who are being treated with contempt.

19:39

[Harriett Baldwin (West Worcestershire) (Con)]

I wish to add to the comments of Members on both sides of the House my recognition of the work that our civil servants do throughout the country. I have spent my working life so far in the private sector. Until I read about this legislation and the background negotiations that brought us to this point, I had not realised that there were still jobs in this land in which people could expect at redundancy to receive a payment of several years’ pay. As we heard, in rare cases people can receive up to six years’ pay. Most of my constituents would be astonished to learn that some who are faced with redundancy—it is inevitably shocking and stressful—are cushioned by a payment of several years’ salary.

I thought I might share with the House some observations from the labour market in the private sector. Redundancy is always a very difficult decision for an employer to take. In my experience, most employers will try very hard to help employees to move within the organisation or reduce their hours. There are many examples in the current downturn of people accepting less work and remaining employed. We acknowledge that redundancy is very expensive, not only financially but in human terms, and that all good employers will go out of their way to try to avoid it. However, we can also see that in a flexible, modern and changing economy, redundancies will occur. Therefore, the provisions are significantly more generous than one would see in private sector employment today.

[Thomas Docherty (Dunfermline and West Fife) (Lab)]

I can think of many privatised companies, as I am sure many colleagues can—I am thinking of British Energy and others—that have generous, multi-year severance packages, so it is wrong to say that we find them nowhere in the private sector.

[Harriett Baldwin]

I thank the hon. Gentleman for his intervention. I have obviously been in completely the wrong line of work, given that I was unaware of such significant redundancy packages.

We all recognise that people are reluctant to make employees redundant, and that they would make every effort to move people to new jobs. However, the Minister made an important point when he said that when redundancies need to happen, people want to avoid the situation in which the most recently hired and lowest paid are let go because decision making is distorted by the packages that must be offered to more highly paid people who have been with a company for a long time.

We can also acknowledge that when redundancies are made in the civil service—I gather that in the three years from 2005, there were 16,500 redundancies, which cost the public purse about £1 billion at an average of about £60,000 per redundancy—the money must be found from the taxpayer. I differ from my colleagues who said that the decision to introduce the Bill was made because of the deficit. I submit that even if we did not have a deficit, the sums of money being paid out in redundancy would seem no less huge.

We have talked a lot about fairness in today’s debate. Is it fair that some of the taxes paid by an individual who finds work after being made redundant in the private sector—the average redundancy payment in the private sector is approximately £9,000—go to pay significant redundancy payments in the civil service? We all agree that something must be done, and as the right hon. Member for Dulwich and West Norwood (Tessa Jowell) said, the CSCS is simply not appropriate for a modern civil service.

It would be right to do something about the situation in good times, just as it is right to do something in tough times, but it would clearly be better, as everyone agrees, if the unions and the Government successfully negotiated a change. It would be more attractive if the redundancies that are being discussed were voluntary. It is often the case that managing a redundancy process that has a significantly more generous voluntary element makes the process much less painful for the work force. In addition, it would be better if we negotiated a change so that the public sector is more vigorous and stronger when new jobs are created. It is one of the counter-intuitive laws of economics that companies that have very generous severance terms tend to hire fewer people than companies that are more flexible. It is also counter-intuitive that the mobility of staff within organisations that have more flexible employment terms is improved. That can often help with morale and job satisfaction.

We have spoken today about protecting the lowest-paid, but perhaps we should talk less about protecting them and recognise that the more junior staff are often able to move up. In other words, instead of talking about protecting junior staff, let us talk about promoting and creating more opportunity for mobility for them within the organisation.

It is also been observed that similar counter-intuitive laws of economics apply to countries. Countries that have more flexible employment laws have much stronger periods of job creation when they move into economic recovery.

I agree with colleagues on both sides of the House that it is a shame that we have to discuss the Bill and that it would be much better if we came to a successfully negotiated conclusion. Let us hope that while the Bill goes through Parliament, the negotiations bring about a more reasonable scheme that is both affordable for the public purse and fair to the very many valuable public servants who are covered by the current scheme.

19:47

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

Like other hon. Members who have spoken in the debate, I have been contacted by a number of my constituents who work as civil servants. The people who contacted me are not serial complainers and campaigners who write to me or to other politicians about everything, but people who do valuable work in a number of different departments within the civil service and other bodies locally, and who are genuinely concerned about their futures. They do important work in places such as the Identity and Passport Service, the Housing Investment Division of the Scottish Government, the Criminal Injuries Compensation Authority, the Child Support Agency and Registers of Scotland. Although those jobs are not based in my constituency, they are based in the travel-to-work area. They are important for an area such as mine, which has seen a downturn in the manufacturing sector and is still reeling from the announcement that Diageo is pulling out of the Johnnie Walker plant.

I have come to the Chamber today to put on record my constituents’ concerns and, like others, to take the opportunity to praise dedicated public sector workers, including civil servants, who have given their lives and careers to work on our behalf. However, it is no good speaking such warm words in the Chamber if we do not take action to back them up. We heard the Minister in his opening statement take a softly, softly approach, saying, “We can sort this. It’ll be all right on the night,” but that does not match up with the measures in the Bill.

[Richard Graham]

Does the hon. Lady agree in retrospect that it was a tragedy that two years ago the PCS did not agree to the previous Government’s proposals?

[Cathy Jamieson]

We heard today that the people whom the Public and Commercial Services Union represents—the majority of people who work in the civil service—did not agree that the previous Government’s approach was the right one at that stage. Whether or not the hon. Gentleman agrees with the union, it had the right to go to court and did so, and secured a ruling in its favour. We must recognise and accept that. I was surprised to hear other hon. Members suggest that the ruling by the court was something that we should simply dismiss, and I would hope that that is not in fact what they are saying.

Given the need for brevity, I will focus on one particular point and that is the device that is being used to push this Bill through. I am very concerned that the Bill has been laid as a money Bill. I am a new Member and I stand to be corrected if I am wrong or if I have misunderstood what a money Bill has traditionally been used to do, but my understanding is that the Parliament Act 1911 defines a money Bill and charges the Speaker with certifying whether a Bill is a money Bill. Previously, money Bills have been used to protect revenue and to raise tax, but never before has a money Bill been used in a situation like this. I agree with my hon. Friend the Member for Hayes and Harlington (John McDonnell) who suggested that the use of a money Bill in these circumstances could be seen as an abuse of parliamentary procedure, and certainly many of the people who have spoken to me about this feel that is indeed the case. It is an abuse of that procedure to try to speed a Bill through Parliament without the proper scrutiny and, as the Minister has already accepted, to use a blunt instrument to try to force something on to the negotiating table.

If we look at the detail of the Bill, although it is very short we see that the degree to which it is unworkable in the long term is implicit in its provisions. The sunset clause, which means that the Bill will expire after 12 months, can be repealed at any time and can only be extended for a further period of six months by secondary legislation, and that is a real cause for concern. On the one hand, the Minister said that we have to negotiate but we cannot negotiate in public. However, at the same time, he is very publicly using this blunt instrument to try to force the unions into a particular position without providing any of the detail that Members on both sides of the House have sought today—

[Michael Connarty]

My hon. Friend is, as usual, shy about telling people that she is a former Minister in the Scottish Parliament and probably knows more about this than most Back Benchers. She also points out that the Bill has a sunset clause, but it is more like a sunrise clause. It is a blunt instrument fashioned to be picked up again and again when the Government do not have the capacity to negotiate and to be used to attack people in the public sector whenever they wish to do so. All that will be required is a statutory instrument off the Floor of the House, without anyone seeing what they are up to.

[Cathy Jamieson]

I am grateful for my hon. Friend’s complimentary remarks. In fact, I am a former Justice Minister. Far be it from me as a former Minister to suggest that people should be suspicious about very short pieces of primary legislation that give greater powers to secondary legislation that can then be picked up and laid without proper parliamentary scrutiny. Having had to work on legislation in another Parliament, I recognise that the concerns expressed by hon. Members are well made in this case.

The Bill puts the Speaker in a difficult and unfair position, because he has to decide whether it should be certified as a money Bill when in fact it is about industrial relations and people should be redoubling their efforts to put the previous deal back on the table and to ensure that all the trade unions are involved in the negotiation. Parliamentary procedures should not be abused in this way.

Given that brevity is required, I shall not seek to rehearse points that other hon. Members have made. However, when we are talking about the low-paid and given all the warm words that we heard earlier about the desire to protect the lowest grades in the civil service, I do not think it is good enough that Ministers cannot identify what “low paid” means in those terms and how many people will be affected. It is incumbent on the Minister who winds up the debate to give us more information on that point.

19:54

[John Thurso (Caithness, Sutherland and Easter Ross) (LD)]

The Minister will know that I wrote to the Minister for the Cabinet Office on 21 July to set out the reasons why I cannot support this Bill. I have to say that I have not changed my mind in the intervening weeks or during the course of this debate. However, notwithstanding the fact that I will not be supporting the Bill, I appreciated the way in which the Minister presented it and the moderation of his tone in some remarks. Given that we are short of time, I shall cut straight to the chase and set out the reasons why I cannot support the Bill. The debate about private and public is the wrong debate. It is not even comparing apples and pears: it is more like trying to compare bananas with Brazil nuts. There is no comparison. I have been in the private sector all my life. I have never had a pension or redundancy terms, and I have always managed to earn a considerable amount of money. I knew what I was getting into. When I signed on for this place, I knew that I would experience a severe reduction in my pay, but that I would get a pension and redundancy terms, although of course the latter are not now so good—[Laughter.] Hey, we will keep working on that.

The point is that people take into account what they will receive in certain situations when they take a job. There may not be a legal contract, but I believe that there is a moral contract between the state and its employees. To put it in human terms, I have people in my constituency who work in the Forestry Commission, for the Department for Work and Pensions—although sadly that office was closed by the last Government despite being one of the most productive and absence-free in the country—and for HM Revenue and Customs in an office scheduled for closure in 2013. The one thing that all those people have been able to count on is that when the Gershon axe fell, they had a cushion between them and penury. In particular, I think of one employee who said to me, “Well, I took out my mortgage based on the fact that if I lost my job I could pay off the mortgage. If this Bill goes through the way it is written, I will have to sell my house.” That is the human reality of this.

Many of the people who have gone into the public sector have considerable qualities, had a vocational desire to be in the public service and have forgone the ability to earn more money in the private sector. Part of their consideration for doing that was the terms and conditions available.

Companies are different because they have a top line, and that can be driven to make more profit and expand further. The last thing that any of us wants to see is an ever-expanding public service. We would like to control it and keep it as cost efficient as possible while delivering the service. It is therefore a wholly different model to driving a top line and delivering a profit. It is right that the famous six times salary provisions—I suspect that those are few in number—and those at the higher-paid end should be reformed, but I am concerned that in fact the low paid in my constituency will bear the brunt, as will those who are coming to the end of their career and have no chance or ability to find another job. I want a scheme that will genuinely offer some help and succour to those at the bottom end of the scale.

I have a final suggestion for the Minister. He probably will not reply to it, but he can take it away for the negotiations to come. If the Government want a cap of £50,000, fine, but they should keep the current terms. That is a progressive way to do it, because the people at the bottom would be very generously looked after and the people at the top would pay most. Let us try that for a change.

19:59

[Gregg McClymont (Cumbernauld, Kilsyth and Kirkintilloch East) (Lab)]

I think that there is agreement on both sides of the House that the scheme needs to be reformed on grounds of economy and fairness, but the questions are what constitutes fairness and how one gets there. My view is that the Bill is arbitrary and unfair, and therefore likely to increase further the suspicions with which low-paid civil servants view this Government. It is arbitrary because it is a coercive measure seeking to impose new terms and conditions on public servants, even as the Government claim to desire a negotiated settlement, and it is unfair because, as we have heard, it does nothing to address the reasonable expectations of the employees concerned, especially, I reiterate, the half of all civil servants who earn less than £21,000 a year.

The people we are talking about are decent people, many of whom do vital and complex work for modest rewards. In my constituency, Her Majesty’s Revenue and Customs is an especially large employer. Most people from Cumbernauld—myself included—have a friend who works, or has worked, in HMRC. Members of the House who are blessed enough to receive official correspondence from HMRC are likely to have done so from Cumbernauld, and the men and women who work there do so to ensure that taxes are paid, tax credits properly administered and the Government’s revenue maximised. Few can doubt the importance of this work, especially in times such as these.

The Minister insists that the Government are working on a package to protect the men and women who do such vital work, but I hope that they will understand that those men and women are not prepared to take that on trust. The Government’s good intentions do not to a policy amount. This is especially the case when a fairer package already exists—the one devised by the previous Labour Government and now accepted as a basis for negotiation by all six trade unions. Alas, the new Government are uninterested and intend to force through changes to the law that override their obligation to consult and reach agreement with civil service unions under the terms of the Superannuation Act 1972. In the long term, therefore, this Bill has implications for the legal right of all civil service unions to consultation and negotiated agreements. In the short term, it means the removal of protection for the low paid.

The Government’s failure to build on Labour’s work in this area will, I believe, have dangerous consequences. All parties are agreed that the times call for more efficient government, but, as has been mentioned, particularly from the Liberal Democrat Benches, efficiency is not just about laying off staff more cheaply; good training, organisation and management are essential if those workers are to do the important job of closing the tax gap—a tax gap that appears to cost us all up to £40 billion a year. My view is that addressing tax evasion and avoidance is the only true, fair way to deal with the deficit. If individuals and businesses paid what they owed, closing the tax gap would become simpler. Successive Governments, including Labour Governments, have failed to do so because they have not resourced enforcement appropriately. It will be so much more difficult to do so in the context of a demoralised, dispirited work force fearful about their jobs and the terms under which they could be made surplus to requirements—a point powerfully made by the hon. Member for Caithness, Sutherland and Easter Ross (John Thurso) and his colleague the hon. Member for Southport (Dr Pugh).

The Government claim that they are about getting more for less, but they have to recognise that this ambition is a complex and demanding one, and that it cannot be imposed arbitrarily from the centre. A Government genuinely interested in efficiency would look to promote bottom-up programmes and work force empowerment, and should not force through primary legislation that dramatically undermines job security. The legislation, I repeat, makes an arbitrary change without consultation or warning. This is slap-dash policy making—the Minister will not even offer an estimate of the potential savings. No wonder that civil servants in my constituency and elsewhere are sceptical and worried. This is not fair, it is not progressive, and it gives the lie to the claim that we are all in this together.

Ministers’ response to criticisms of their changes to the CSCS parallel the Government’s defence of the fairness of their policies more generally—“Do not judge us by what we have said and done. Judge us by what we might do in the future.” My constituents are not prepared to take the Government’s word for it. The gap between rhetoric and reality has already been observed in a number of areas in Government policy. This Bill will produce agonising uncertainty among modestly paid civil servants, will undermine their productivity in the service of the public, is damaging to industrial relations and exposes a divisive and confrontational attitude on the part of the Government. Most damagingly of all, however, it ignores progress made by the pervious Government.

I will finish on this point. My constituents are generally sceptical of the bona fides of the Government, so I ask the Minister and the Government to do something concrete to assuage their fears about their intentions in this area of policy.

20:07

[Gavin Williamson (South Staffordshire) (Con)]

Given that, in this Chamber, we often talk about cuts, you will be pleased to hear, Madam Deputy Speaker, that I have cut my speech substantially, in the interests of time.

It is interesting that so far in this debate there has been a general acceptance, on both sides of the Chamber, that change is needed in the civil service compensation scheme. That acceptance is welcome. I appreciate that both sides of the House cannot agree on how those changes should be made, but this Chamber and this nation are faced with some difficult and hard truths—we cannot afford the situation that the country finds itself in or the deficit that the Government have inherited. While I, like, I am sure, virtually every Government Member, want to see compromise and agreement between the Government and civil servants and civil service unions, we cannot wait for, or be held ransom by, one union that has decided that it does not wish to seek a compromise.

The simple truth is that there is a massive disparity between the private sector and the civil service when it comes to redundancy. Figures from the Chartered Institute of Personnel and Development estimate that, in autumn 2008, the average cost of a redundancy in the private sector was £8,981. Yet, according to comparative figures for 2005-08, 10,000 compulsory early severance packages were served on civil servants, costing an average of £42,000 each. All Members would accept that that is a substantive difference. Governments, like businesses, need flexibility in what they do and how they work, but the current scheme does not offer that flexibility. We can argue about three years, six years or two thirds, and we can talk about trying to achieve efficiency savings, but the simple reality is that we are facing a payback of between three and six years in order to realise the benefit of those efficiency savings. Unfortunately, that it is not going to be enough in the difficult times that we have inherited from the previous Labour Government.

I very much welcome the words spoken by my right hon. Friend the Minister at the Dispatch Box, along with his obviously heartfelt wish to seek compromise and reach agreement with the unions, for the benefit of everyone in this nation and of the civil servants who work so diligently for this Government. That should be welcomed on both sides of the House. I also hope that, with the passage of the Bill, the civil service unions will realise how important it is to reach that compromise swiftly, for the benefit of all.

20:11

[Ms Margaret Ritchie (South Down) (SDLP)]

Like other hon. Members, I have received representations from constituents, many of whom are civil servants. Very few would disagree that the civil service compensation scheme should be reformed; in fact, there are good, compelling arguments for public sector reform. However, we need to ensure that the compensation scheme affords protection for some of the lowest-paid and longest-serving public sector workers. Lower-paid staff should not be the victims of departmental cuts or of what is proposed in this Bill.

I represent a constituency in Northern Ireland whose economy is heavily dependent on the public sector. I am conscious that public sector reform is needed, that the economy needs to be rebalanced and that the private sector needs to grow and be stimulated, but there is still an urgent need to sustain jobs in the public sector and to make provision for new entrants into the civil service. Reform must always be tempered by the principles of social justice and fairness and by what is in the best interest of the public. We must not undermine the basis of the existing economy.

I speak as a former Minister in Northern Ireland who had responsibility for the benefits system for some three years. During that time, I had responsibility for some of the lowest-paid civil and public servants in Northern Ireland. Many of them were women, many worked part time and many were vulnerable. Why should such people be held responsible for the present situation? Why should they be the victims of this legislation? Why should they be susceptible to the loss of their jobs? We must also recognise that, although we are in the midst of an economic downturn and facing severe budgetary cuts, there is still a need to protect front-line services, and the vulnerable and disadvantaged. Many civil servants, particularly those in the lower grades, feel that their jobs are under threat. That is their perception, and I have heard nothing today from the Government Benches to assuage those fears.

Notwithstanding all these factors, it is important that Parliament defends the roles and rights of civil and public servants, particularly those in the lower-paid grades. The proposals in the Bill will slash redundancy compensation, especially for older and longer-serving staff. It is important that proper agreements should be reached with the civil service staff and that those agreements recognise the accrued statutory rights held by many of them. The agreements should also be fair to new entrants to the service. The Bill must not be used as a blunt bargaining tool to influence the negotiating process. Efforts must be made to protect staff and the delivery of front-line services, as well as to develop our economy at this difficult time.

I suppose, after this long Second Reading debate, that the best maxim would be that we should follow the road of proper negotiation, rather than that of unilateral imposition. I have learned over the past few weeks that some people believe that the coalition Government are less interested in listening to the views of those who represent the stakeholders. Perhaps that can be seen in their reactions and efforts in relation to the Bill. My hon. Friend the Member for Foyle (Mark Durkan) asked what agreements had been reached with the trade unions in preparing this Bill. Obviously, there has been little agreement.

The Government seem anxious to depart from negotiation, even though it has always been the standard bearer for industrial relations, and to move to imposition. In fact, the Minister for the Cabinet Office could not even provide the right hon. Member for Belfast North (Mr Dodds) with a definition of a lower-paid civil servant. My colleagues in the Social Democratic and Labour party and I are firmly of the opinion that the Bill should be withdrawn, as it is not in the best interests of junior and lower-paid civil servants.

20:16

[Matthew Hancock (West Suffolk) (Con)]

It is a great pleasure to speak in this debate under your speakership, Madam Deputy Speaker. I shall concentrate on the issue of fairness, which has come up again and again today. It is central to the Bill, and an extremely important factor. We are debating a sobering situation, and the Bill is a response in part to the enormous fiscal deficit that we need to tackle. It is clear that the negotiations and the Bill will have an impact on many thousands of civil servants who have worked extremely hard for the good of their country. Like many other Members, I pay tribute to the excellent work of the British civil service, and I echo the view of the Minister that it is the jewel in the crown of our constitution.

That is why it is so important that we consider the consequence for fairness as the negotiations go forward and the Bill goes through. That view has been reflected in speeches from both sides of the House today. I shall address the issue of fairness in three different ways. First, we must consider the fairness of these measures, given what else is going to have to happen if we are to tackle the deficit. Secondly, we must consider fairness across society and the economy. Thirdly, we must take into account fairness within the civil service in terms of working practices, and the consequences of the current system for some of those working practices.

The enormous fiscal deficit has overshadowed many of the debates in the Chamber since the election. We on the Government Benches argue that dealing with the deficit is a fair and progressive thing to do. In the short term, failure to do so would lead to higher mortgage rates and interest rates as well as create the risk of a catastrophic economic failure, which we do not want to do. It would also be unfair to burden our children and grandchildren with levels of debt that we had failed to deal with. It is therefore fair and progressive to deal with the deficit. It is important, when considering all the different aspects of that process, to think about the Bill in that context.

How can it be fair to defend a system, as Labour Members have done, in which payments of more than £500,000 have been made to certain individuals at a time when we are having to take other measures—as Labour Members would have had to do, were they still in office—to deal with the deficit? How can it be fair that the average redundancy package in some Departments has been more than £100,000 for the past three years? In an earlier intervention, I gave the example of the Department of Health, in which the average redundancy package last year was £122,000.

When this country is tackling its deficit, it is difficult to say that it is fair to make such enormous redundancy pay-offs. The argument has been put by Labour Members that there are only a few of them so it does not really matter. However, we as a country are going through a difficult process, and having extremely unfair examples of public spending like that only makes it even more difficult. We cannot argue that simply because there is not an enormous quantity of such payouts, they do not matter. They do matter and reforming the system is crucial, as the Opposition Front Benchers seem to recognise, but Labour Back Benchers too often do not.

[Michael Connarty]

I am amazed that the hon. Gentleman is still quoting the figure of £100,000 when one of his hon. Friends who spoke earlier provided him with the true average of £60,000. He ignores reality again and again. Some people get huge payouts, and some Labour Members have argued against them for the last 10 years but we could not convince our own Government to deal with these people. If the hon. Gentleman’s logic had been applied after the second world war, the huge deficit this country would have had to carry would have meant no rebuilding and our people living in poverty for the next 50 years. The hon. Gentleman may be lucid, but he is certainly wrong.

[Matthew Hancock]

The hon. Gentleman answers his own question when he says that the previous Government did nothing about the problem over the last 10 years. As for this new argument I am hearing expressed by Labour Members, that we had a large deficit in 1945—yes, we did, but we also had large cuts in 1945 and not least to the military because we had just won a war. There are no such easy reductions now because of the mess left by the Labour party—[Interruption.] I will take no lessons from what the hon. Gentleman shouts out from a sedentary position. At one point in the last three years, £8 billion was spent on redundancy payouts. I do not know whether the hon. Gentleman is willing to defend very high payouts, but we seem to be getting a reaction on the Labour side against any change to anything. It is a great pity that Labour Members do not engage in the process of trying to deal with the deficit as we Conservative Members do.

[Claire Perry (Devizes) (Con)]

I would like to focus on the average rather than the outliers, as that seems to elicit cries of outrage from the Opposition. It is an incontrovertible fact that if we look at the average redundancy payout and average compensation, we find that the average cost in the private sector in autumn 2008 was £8,981, while it was £17,926 in the public sector—almost twice as much. That demonstrates that we have reached a position where, on average, people are being paid twice as much to retire from the civil service as they are to retire from the private sector. There is nothing fair about that.

[Matthew Hancock]

It is always dangerous to give way to my hon. Friend, because she usually puts the point far more lucidly than one could oneself.

I was going to come on precisely to that point—my second point about fairness. Not only is it fair to deal with the deficit and, I think, unfair to give enormous payouts when we have to achieve other very difficult things, but fairness across the economy and across society is also important. The maximum payout in the mandatory private sector compensation scheme, for which this House legislated, is £11,400, yet the proposal is nowhere near that figure within the public sector.

It was interesting to note that when the shadow Minister, the right hon. Member for Dulwich and West Norwood (Tessa Jowell), responded to an intervention about whether it was fair to have a similar sort of payoff scheme in the private sector as in the public sector, she effectively said that she was not in favour of equality. I thought that Labour Members were in favour of equality, but obviously not when it does not suit.

[Tessa Jowell]

I am not quite sure what point the hon. Gentleman is trying to make. If the question is whether I agree the case for parity between the public and the private sector on these matters, the answer is that parity cannot be willed. We are not going to peg the public sector to the private sector other than in an indicative way. There are different incentive structures in the remuneration packages of people who work in the two sectors and they are in different ways reflected in aspects such as the compensation for redundancy that we are discussing this evening.

[Matthew Hancock]

I thank the right hon. Lady for her intervention. In some cases, it seems, one can talk about parity, and in other cases about equality. If one is favour of it, one might use one word, but if one is against it, use the other. The important point here is that we need to look at overall compensation packages and overall pay, including pensions and other terms and conditions of work.

That brings me back to the issue of fairness across the sectors. If we are to have a modern civil service and a modern flexible economy that work in the future, we also need to allow transfer between the two sectors. Bringing into line the working practices in the two is no bad thing; nor is bringing into line the redundancy payoffs as the Bill does—and, indeed, as the right hon. Lady’s former proposals did. The hon. Member for East Kilbride, Strathaven and Lesmahagow (Mr McCann) raised an interesting point when he argued that we should put the members of the unions ahead of the rest of our constituents. I think that the most important thing for a new MP to do is to represent all of their constituents, not just those who are members of a union.

My final point is about fairness in employment practices. I asked the House of Commons Library about the concept of priority posting pools, which are groups of civil servants who are given nothing to do, but cannot be let go because of the cost of the redundancy package. The Library determined that there were a total of 1,946 such civil servants. When people working for their country have completed their jobs and their projects, it cannot be fair to tell them, “We would like to pay you to do nothing. We cannot find anything useful for you to do. We do not think you would be any good at doing anything else, but we cannot afford to get rid of you, so we are going to carry on paying you.” As of January 2010, there were 1,946 such people in the civil service. I believe it is unfair to them not to have a flexible employment system so that we can have a grown-up and modern civil service working for the future.

Such is my argument. We are here to look at the fairness of this Bill as well as other aspects of it. If we want to spend public money fairly, rebalance our economy fairly and try to improve the fairness of working practices in civil service employment, we should support the Bill. The alternative is defending £500,000 payouts, an unbalanced economy and out-of-date working practices. I do not want to defend those things, so I will support the Bill this evening.

20:28

[Sheila Gilmore (Edinburgh East) (Lab)]

Notwithstanding the warm, or perhaps lukewarm, words from the Minister about our civil servants, I see the Bill as part of a concerted attack on the public sector and those who work in it. The war on the public sector is being waged by some parts of the media without contradiction from the Government, and, indeed, by large parts of the Government.

Creating a straw man or woman simply to knock it down is lazy politics, but that has been done this evening by speaker after speaker. It is a case of picking up an extreme example partly in order to divert public opinion from the reality. The aim is to win over public opinion—to make the public think, “Oh, that is dreadful! How can people receive payouts, or salaries like that? We must do something about it”, rather than see the reality.

We cannot get away from the economic argument. Earlier, one of my hon. Friends feared that, if he drifted on to the subject of the wider economy he might be accused of irrelevancy, but that subject is not irrelevant. We see a clear divide between the two sides of the House, not because Labour Members are not concerned about the deficit but because we have a different view of the economy, how it should be built, and how we should emerge from recessions. Members on the other side of the House obviously see the public sector as a drag on the economy and something that must be shrunk, and they tell us that lo and behold, the private sector will leap up to pick up the pieces.

[Richard Graham]

Does the hon. Lady accept that those of us on the Government Benches who have worked in the public sector find that very disappointing to hear?

[Sheila Gilmore]

Members on those Benches may find it disappointing to hear, but it is what many of my constituents who work in the public sector are hearing. They are witnessing a concerted attack on the sector and on public service. I am sure that many Members on the other side of the House genuinely believe that the public sector is pulling the economy down, but we do not believe it. We believe that we must not at this stage cut the public sector in such a way that the economy is put at risk, but that is what will happen if the Bill is passed.

Public sector cuts will increase unemployment, and my constituents are asking me where the other jobs are. Over the past few weeks redundancies have been announced by Standard Life, which is a big employer in my city, and by the Royal Bank of Scotland, which has also been a big employer there. My constituents are seeing such developments all around them. The construction industry has an administrative side, and people might otherwise have thought of working in that, but the sector has been decimated, and they know that there are no jobs.

We could all throw in such terrible examples. Members have spoken of low redundancy payments in the private sector, but we could cite the amount of money that Fred Goodwin received when his employment was terminated. Is it right for us to “equalise down”? We talk of equality, but why is it assumed that we should look to the least good employment conditions, and try to reduce the conditions of our public servants to that level? Some workers in the private sector do not receive sick pay. Where will it stop? Are we going to say, “That is a good idea—perhaps we should equalise downwards”? Such thinking constitutes a slippery slope, and in my view it is quite wrong. I am not surprised that my constituents are anxious.

Like some of my colleagues, I visited the local Jobcentre Plus during the summer break, and in many ways I found it an inspiring experience. It is a far cry from the old days when the staff sat behind glass barriers, frightened to come out, and people on the other side sat on chairs that were fastened to the ground—presumably in case they lifted them up and threw them—to arrange to sign on. A real effort has been made to do something that every party in the House considers important—to get people back to work—but how can that be done if the morale of the people who should be doing the job has been lowered?

I do not think that the Bill is the right way to deal with the situation. If we were serious about the outliers, the Bill would be about them. If the problem is people on very high payouts—we have heard about that from several Members today—why is the Bill not about that? If that is the problem, the Government should deal with it, rather than introducing a Bill which will hurt all civil servants including the low-paid, and which is being used as a bargaining tool to force people to agree to even worse terms than those proposed by the Government. What is clearly being said is, “If you do not agree to much worse terms than you have at present”—although perhaps slightly better terms than those in the Bill—“the terms in the Bill will be what you have.” That is really what the legislation is about.

20:33

[Martin Horwood (Cheltenham) (LD)]

I declare a strong constituency interest in the Bill. Like many other Members, I have my fair share of constituents who work in local offices of central Government Departments such as the Department for Work and Pensions and Her Majesty’s Revenue and Customs. For the moment, I also have constituents who do important work involving the environment and the countryside at Natural England and the Commission for Rural Communities. But, of course, most of those in Cheltenham who describe themselves inconspicuously as civil servants work at GCHQ. They form the largest part of what the Prime Minister has rightly described as

“the finest intelligence services in the world.”—[Official Report, 6 July 2010; Vol. 513, c. 175.]

GCHQ traces its roots directly to the wartime Government Code and Cypher School at Bletchley Park, which, as we now know, made a huge contribution to victory in the second world war. That contribution, however, remained largely unknown and unrecognised for decades because of the absolute discretion and loyalty of those anonymous civil servants—people like my own parents, who worked at Bletchley and, later, at GCHQ. When the history books are written 60 years from now, who knows what silent victories we will learn were being achieved as we spoke here today, and which will remain secret for decades to come because of that same brand of loyalty? I must say that, on the face of it, this Bill is a pretty poor reward for the loyalty of my constituents in GCHQ and of all the other civil servants in Cheltenham.

It has been suggested that, on average, public sector pay has caught up with private sector pay. I will not invite a repetition of the earlier altercation across the Chamber about which is higher, but neither of the sets of figures cited were based on directly comparable jobs and careers, and that is what really matters. A constituent who wrote to me put it very well:

“I’ve had a long career in the public sector and watched my university friends prosper in the private sector. They have had company cars, private health care and almost without exception greater earnings. In compensation I had more flexible working, a good pension (although not as good as friends in the insurance industry) and the knowledge that I wasn’t in a hire and fire culture. Yet now, all the benefits are under attack but I can never make up for all those years of lower pay.”

The mathematicians, linguists and IT experts at GCHQ are some of the finest minds in the country and had they chosen to work for Vodafone or Hewlett-Packard they would have undoubtedly earned more—perhaps much more—but they chose to serve us instead. As one of my friends who worked at GCHQ once wryly told me, “It does inhibit you a bit in job interviews when you’re asked to describe your work over the last few years and you have to say, ‘I’m not allowed to.’”

GCHQ may be a rather extreme example, but it is true that many civil service careers do not translate easily into private sector job opportunities, especially if they have been very long careers in the civil service. The key point has been made by the hon. Member for Hayes and Harlington (John McDonnell), my hon. Friend the Member for Caithness, Sutherland and Easter Ross (John Thurso) and others: our civil servants make life choices based on the promises we make to them. They make decisions about their homes, where they live, the schools their children attend, and above all they make career choices and financial decisions. They expect that if the day comes when it really matters we will keep our side of the bargain and repay their loyalty as promised. Well, that day has obviously come.

There is no question but that the Government are right to take drastic action to prevent further damage to our economy. I regret it deeply, but there is no question but that many civil and public servants will inevitably have to lose their jobs. The last Labour Government knew that too. The Cheltenham offices of Her Majesty’s Revenue and Customs, Natural England and the Commission for Rural Communities are all closing, with inevitable redundancies. As overall departmental cuts bite there will doubtless be more, although I truly hope that an organisation as vital to the national interest as GCHQ will be looked at with the most extreme care.

There is also no question but that the Government are right to look at the civil service compensation scheme, which may now be more—possibly much more—generous, especially to top earners, than we can afford. That was certainly the conclusion of the Labour Government when they too tried to curtail the scheme to control costs. As the hon. Member for West Suffolk (Matthew Hancock) said, it is true that, if we do not economise enough here, we will have to economise somewhere else.

For all those reasons I understand why Ministers had to look closely at the scheme. Labour tried and failed to curtail the scheme by compulsion, but, of course, this Bill does not simply repeat that attempt at compulsion. It reduces the limit on redundancy compensation to one year’s pay, which is even more drastic than Labour proposed. Incidentally, it is also more drastic than the terms that apply in other areas of public service such as the NHS or local government.

Another constituent wrote to me that as a civil servant she felt “victimised” by the new Government, and she was a Lib Dem supporter. If there is even a perception of that level of unexpected unfairness from our own supporters, we should hesitate before going ahead with this Bill. It is unexpected because these proposals were in neither coalition party manifesto. In the coalition programme for government there was a promise to reform the scheme and to bring it into line with the private sector. Reform can be very good. It could, for instance, have given civil servants some more of the security of the contractual guarantee of compensation enjoyed by many in the private sector, protecting them somewhat from the whims of Governments. The Bill, it seems to me, deviates radically from good practice and from the principles of the 1972 Act. It contains a compulsory and substantial reduction in the agreed rights of civil servants and, arguably, the legally accrued rights of civil servants to compensation, and will be enacted just when they may need them most and while negotiations are under way. I must agree with other hon. Members that using legislation as a negotiating tool is unworthy of this Government.

If it is intended that the negotiations should lead to a more generous settlement, especially for the lower-paid, which is what the Minister for the Cabinet Office suggested, and that we can therefore expect the repeal of clause 1 by Ministers in due course, that prompts the question of why it is needed in the Bill in the first place. Why not place a more generous cap, perhaps along the lines of the earlier proposals, in the Bill? Why do Ministers need a weapon that they have no intention of using?

My father could not tell me very much about his work at GCHQ, but he once shared with me the news that he had successfully concluded quite tough negotiations about terms and conditions with the GCHQ trade unions on behalf of GCHQ management. They bought him a drink afterwards and he, I hope, retained the respect and loyalty of his colleagues. I am not sure whether PCS will be buying Ministers drinks after all this is over, but as a Government we should, at the very least, aim to retain the loyalty and respect of our civil servants. In Cheltenham, our national security might depend on it.

Those GCHQ trade unions were subsequently banned by a less enlightened Government than this one—something that was mercifully reversed some years later. I am confident that such union bashing lies firmly in the past and that this Government are committed to policies that are transparently fair. I hope that Ministers will, on reflection, agree that this Bill in its current form does not pass that test. They will have guessed by now that I plan to vote against it tonight.

20:42

[Lindsay Roy (Glenrothes) (Lab)]

Thank you, Madam Deputy Speaker, for calling me to make a short contribution to this vital debate on civil service superannuation. My comments will be brief and they are intended as constructive reinforcement rather than unnecessary duplication, but it will be a test for Members to see whether they can distinguish the difference.

Let me say at the outset that few in the civil service in my community—and there are many of them—would deny that the civil service pension scheme needs reform. Given that position, there is all the more reason why the reform should focus on renegotiation rather than, as is patently obvious here, on a Government planning to proceed unilaterally with a devastating agenda. I appreciated the Minister’s comments about the virtues and values of the civil service, but the contents of the Bill do not match that unqualified support. Significantly, the Bill tells us much about the nature and culture of this Government who, at the same time as focusing on negotiation, are using a blunt stick to bulldoze through change. They are taking measures forward in legislation that, if enacted, would have a damaging effect on a cohort of modestly paid people who give outstanding service to our community. Indeed, I dispute the fact that they are not profit-making. They make profit, although not in financial terms, through the dividends and benefits that they give to our community, which are much appreciated.

Surely in the aftermath of the judicial review, the opportunity should have been taken to engage in a steep learning curve jointly through further negotiation. A bullish, insensitive and punitive approach destroys trust between Government and a loyal and dependable civil service work force who believe that they are being treated shabbily, to say the least. They believe that they are being marginalised and that they are bystanders in the whole process. It ill behoves a Government who claimed that they would be champions of fairness to act in such a draconian way, trying to push through an unacceptable change without proper scrutiny. The vast majority of civil servants are modestly paid, yet they play vital roles in our society, as we have heard. They keep our borders safe, support our armed services and help the unemployed.

In essence, the Bill does not strike a fair balance between the interests of taxpayers and the legitimate expectations of civil servants, many of whose livelihoods are being threatened. Governments do have to make hard decisions, but they must underpin those with the values of justice, fairness and respect. Those values seem sadly lacking in the approach that has been taken—or at least that is the perception, as the lowest paid appear to be being treated in a reckless and cavalier manner. Let us make no mistake: this Bill is potentially part of a slash-and-burn approach, a highly insensitive attack on modestly paid public servants who, in an economic downturn, are facing real challenges economically.

So where do I see us going? My focus would be on renegotiations that will succeed and make the Bill redundant. So I urge the Cabinet Office Minister to reaffirm his commitment to go that extra mile—to adopt the principles of the February scheme as an initial basis for discussion; to review his definition of reasonableness, particularly in protecting the lowest-paid; and to balance the needs of the taxpayer and the legitimate expectations of civil servants.

The civil servants of this country deserve to be treated with dignity—with fairness, justice and respect. The citizens of this country expect nothing less, and I hope that common sense will prevail in resolving this dispute, and that the Minister will be persuaded to reconsider his strategy and tactical approach in addressing this dispute, and withdraw the Bill.

20:46

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

We have heard many speeches about unfairness and the lack of comparability between the schemes in the public and the private sectors, yet those speeches were unnecessary because, as far as I am aware, absolutely no one—not even the hon. Marxist Member for Hayes and Harlington (John McDonnell)—disagrees that we need more comparability and that the scheme that we are discussing tonight is over-generous and unaffordable.

Quite a few speakers have prefaced their speeches with glowing compliments to members of the civil service but have shown little sensitivity to the position that they would find themselves in if the Bill were passed. There may be a very good argument for changing the terms and conditions, but many members of the unions will have made life decisions based on their existing contracts, and they would be facing pretty severe circumstances, which they could not have planned for in many cases.

I was a trade unionist for 30-odd years and it was a general principle to consult before changing terms and conditions of service; that is a basic rule in industrial relations. It was not good practice to change terms and conditions while consultation was taking place.

The whole of the Government’s strategy is built on a plan to rebalance the economy, and I support that strategy. The rebalancing includes a real determination to increase the nation’s economic capability by increasing the scale of private sector employment to soak up the increased unemployment that will inevitably follow from the reductions in public spending required as part of the plan to reduce the national deficit. As a matter of principle, is it right to add to the sense of uncertainty, and no doubt in many cases the fear of redundancy, currently felt by many public sector workers by seeking seriously and unilaterally to reduce their entitlements to redundancy payments? This is not an emergency measure—unless, of course, it is intended for that purpose.

I say to my friends on the coalition Benches that I believe we are actually entering into a pact, not with each other but with the British public, and that pact is one in which judgment on the coalition is still deferred. The pact has to do with the strategy that I just outlined for rebalancing the economy. The Chancellor said many months ago that the Budget would be “tough but fair”. The public know that it will be tough, but they are watching closely to see just how fair things will be.

Since the judicial review, all the unions have indicated a willingness to engage in further negotiations. That offer should be accepted with good will before we are asked to deliberate. What on earth are we doing getting involved in the nitty-gritty of discussions, consultations and deliberations on terms and conditions of service? That is not our role.

The Bill is important, not just because of the savings to the public purse, which we recognise are necessary, but because of the message that we are sending to those who work in the public sector, and to their representatives. People are committing an act of faith in thinking that we are working in the best interests of the national economy to put things right, but they are watching how we do that.

The degree to which the private sector can rise to the challenge of job creation is uncertain. The degree to which the public sector may be asked to contribute to balancing the nation’s books is less uncertain. Efficiencies can and must be found to minimise the impact of budget reductions on front-line services, but no amount of natural wastage and vacancy freezes will remove the need for some redundancies. What message are we sending out if we pass the Bill?

At this most difficult time in the public sector, just when we require the support and good will of the trade unions, we in the heart of Government seek to jab them with a stick—to show them what? That we are tough? In the case of the PCS, possibly it is to teach it a lesson for daring to take us to court. There seems to be resentment against the PCS for stopping Parliament doing something unlawful.

It is the responsibility of all of us who support the public sector to root out and remove inefficient and ineffective public expenditure, because by doing so we defend the sector from those who are ideologically opposed to it. I cannot defend over-generous and unaffordable terms and conditions of service in the public sector, and I have told people who have written to me on the subject that I cannot possibly support them on keeping the current scheme, but I believe that it is wrong, especially at present, when public sector jobs are expected to be lost, to use this House as a means of conducting negotiations with the unions.

I chased my Labour opponent for 20 years and stood against him five times before I managed to get into this House, and one of the slogans that we ran with towards the end of that time was “He never voted against his Government in the interests of his constituents”. Well, I am not about to make that mistake this early in my time as an MP.

20:54

[Chris Williamson (Derby North) (Lab)]

This is a mean-spirited, parsimonious Bill that borders on abuse of parliamentary procedures. We heard very plausible, warm words from the Minister for the Cabinet Office; it was almost as though he was in some way sympathetic to the civil servants who will feel the full brunt of this mean-spirited Bill, if it gets through its parliamentary stages. But make no mistake—and I am sure that the civil servants who are following our debate closely will not do so—the Minister for the Cabinet Office has cloaked his iron fist in a velvet glove.

The contributions from Conservative Members left me cold. It is clear that the Conservatives have not changed one iota—they are still the same old nasty Tory party, attacking the most vulnerable and lowest paid people in this country, just as they did in the 1980s and 1990s. We heard some rather sympathetic contributions from Liberal Democrat Members. One or two even said that they will join Labour Members in the Division Lobby. Let us hope that all Liberal Democrat Members have the courage of their convictions and join us in helping to defeat this terrible piece of legislation.

The Finance Bill introduced by the Con-Dem coalition is likely to lead to a double-dip recession. It received Royal Assent on 27 July, and inevitably it will lead to an increase in unemployment. It is against that background that the Superannuation Bill has been introduced, at a time when people are looking for work and finding it difficult to obtain employment. However, the Minister for the Cabinet Office and Conservative Members want to throw people on the dole, leaving them in a vulnerable situation by undermining the terms and conditions that have been built up over many years.

We heard one Member—it may even have been more than one—claim that the measure was fair in some way. The hon. Member for West Suffolk (Matthew Hancock), who regrettably is not in the Chamber, said that the Con-Dem coalition was all about fairness and was progressive as well. The Conservatives ought to look up the meaning of “fairness” and “progressive” in the Oxford English Dictionary, because the legislation that they have introduced is the very antithesis of fairness and of progressive politics. The Deputy Prime Minister himself said in the general election campaign that he wanted to “hardwire fairness into…society”. The Bill, however, is yet another example of how hollow his words really are.

The Bill is the direct opposite of fairness, and it does not strike a fair balance between taxpayers’ interests and civil servants’ legitimate expectations. It provides inadequate protection for some of the country’s lowest paid public sector workers. I wonder whether it is the thin end of the wedge. Many people in the public sector enjoy better severance packages than what is proposed in the Bill—in the national health service, in education, and in local government, the ceiling is two years—but time will tell whether they are next on the Con-Dem Government’s coalition hit list.

The Minister for the Cabinet Office told the House that he would introduce the Bill:

“I will bring legislation to the House as soon as parliamentary time allows in a Bill to limit the costs of future compensation payments for both compulsory and voluntary civil service exits.”

He went on to say that

“I hope that the Government’s invitation to the Council of Civil Service Unions will be received in the spirit it is offered and that they will engage speedily and constructively with a view to reaching an agreed, fair and sustainable long-term civil service compensation scheme.”—[Official Report, 6 July 2010; Vol. 513, c. 3WS.]

What a way to conduct negotiations—introducing legislation in the House, leaving the Parliamentary Secretary, Cabinet Office, the hon. Member for Ruislip, Northwood and Pinner (Mr Hurd), to wield the sword of Damocles over the heads of the civil service unions and people working in the civil service. It simply is not the right way to conduct negotiations.

The Minister for the Cabinet Office has said that he is concerned about low-paid workers, and he repeated that today. Where, however, in the Bill is there a proposal to help those workers? It is non-existent. If he was genuinely concerned about assisting low-paid workers, he would include a provision to deal with the very point to which he referred in July, and again tonight. Once again, words from the Ministers of the Con-Dem coalition are meaningless and utterly hollow.

The Con-Dem coalition seems to be abusing the negotiating protocols by manipulating parliamentary procedures to get its own way, and that will not do. That is not the way to conduct negotiations. It is a sad day for democracy in this country when we see such a Bill before us. The Minister acknowledged that it was an extremely blunt instrument. Then why bother enacting it? Why not take a more sophisticated approach in the 21st century to industrial relations?

To conclude, in the short time that I have, what I find so objectionable about the process is the attempt by the Con-Dem coalition to get the Bill defined as a money Bill to prevent proper scrutiny in the other place. My hon. Friends the Members for Kilmarnock and Loudoun (Cathy Jamieson), for Hayes and Harlington (John McDonnell) and for Birmingham, Erdington (Jack Dromey) have all made that point. The gerrymandering tendencies of the Con-Dem coalition that were so blatantly exposed in the Parliamentary Voting System and Constituencies Bill are permeating other areas of policy making.

The Bill has been drawn up without consulting the work force. The Minister admitted that. Although he tried to wriggle and say, “Of course I’ve had discussions but, you know, the previous Government had negotiations,” he was clearly nailed when that was put to him. There have been no negotiations. The Bill has not been subject to sufficient pre-legislative scrutiny, but that is not particularly surprising, given the experience of the past few months.

This is a bad Bill, which will lead to a bad law. That is why I will vote against it tonight and support the reasoned amendment moved by my right hon. Friend the Member for Dulwich and West Norwood (Tessa Jowell). I call on all Liberal Democrats to have the courage of their convictions and join Labour Members in the Lobby this evening.

21:02

[Jeremy Lefroy (Stafford) (Con)]

I shall be brief, as I have been instructed and as I wish to be. The Bill aims to do something that is necessary—to reform the civil service compensation scheme. I support the aim. It should have been done many years ago. The scheme is not affordable in its current format. But I have a problem with what I have heard in the debate about the Bill being some kind of negotiating tactic. We have been elected to the House as legislators, not as negotiators. It is for Government to negotiate and for Parliament to legislate. I would value the comments of colleagues on that.

The previous Government put a great deal of work into reforming the compensation scheme, which I acknowledge, but it would have been better had they started the process a lot earlier. The work that they put together with the unions was eventually frustrated. The history is known to us all, and I will not repeat it.

I support the statement made by my right hon. Friend the Minister for the Cabinet Office on 6 July—a date that I cannot forget as it was the date of my silver wedding anniversary—that a settlement was required which

“will need to be fair, and in particular to provide a higher level of protection for lower-paid workers.”—[Official Report, 6 July 2010; Vol. 513, c. 4WS.]

In saying that, the Minister was echoing the comments of the right hon. Member for Dulwich and West Norwood (Tessa Jowell), when she said last year that the changes proposed at the time were aimed at

“protecting the lowest paid civil servants”.

It is clear that there is agreement across parties that lower paid civil servants should receive protection. That is only right. I ask the Minister to consider how he can best reflect that through the Bill which we, as legislators, have before us. As it stands, civil servants on all salaries are treated in the same way, with no particular consideration being given to those on the lowest pay. I know that he will have given careful thought to how the sentiments of his words on 6 July can best be reflected. They are the same sentiments that informed the Chancellor’s action in the June Budget, when he protected the lowest paid workers from the general pay freeze, as was mentioned earlier.

I, like many colleagues from all parts of the House, want to underline the importance that I place on the work of those concerned. When we speak about people being made redundant in the public sector, we certainly do not want to send out the message that, somehow, it is their fault. If someone is in a job that is no longer necessary or even affordable, we should look at who created that job and why. Governments of all colours have been guilty of being far too quick to take on staff for a new scheme without thinking about the long-term future. People are not playthings to be shuffled around on a whim. That is not to say that I oppose flexibility; I welcome it. But flexibility cuts both ways.

My second point concerns civil servants who have been in the public service for many years. A constituent of mine, working for the Ministry of Defence, pointed out that under the Bill he will, with a reasonable length of service, be entitled to the same payout as colleagues who have worked two or three times as long. He had no self-interest in raising that point; he simply wanted to speak up for his colleagues. I am a great respecter of length of service. Dedication and loyalty, whether in the public service, a private company or, indeed, a relationship is almost always something that we should celebrate. I therefore ask the Minister to look at how that can best be reflected in the Bill.

I shall support the Bill, because I know from what the Minister said today that he understands the points that I have made, but I urge all who are involved in negotiating the new settlement to arrive as soon as possible at a sustainable, practical and affordable long-term scheme.

21:06

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

I too shall be brief, because I know that time is short, and one way in which I can be brief is by associating myself with the eloquent remarks of the hon. Member for Hayes and Harlington (John McDonnell), who is no longer in his place.

I am glad to have the opportunity to speak, as more constituents have written to me to express concern about changes to the civil service compensation scheme than have written to me about any other issue since I was elected in May, so I am very keen to ensure that they are properly represented here today. There is a palpable sense of anger and disillusionment among public servants, and a real feeling that they are being made to pay for an economic crisis that was not of their making.

My constituency in Brighton is home to a large number of civil servants. Under their current compensation scheme, they have accrued rights that will simply be scrapped—torn up and thrown away—by the Government’s proposals, despite the court ruling that a failure to recognise accrued rights is unlawful, and that any amendments to the civil service compensation scheme must be made on the basis of agreement by all the relevant unions.

Morale in the civil service is at an all-time low. One Brighton Pavilion resident who came to see me in my constituency a few weeks ago put it like this:

“Many civil servants will, like me, have planned their finances on the basis that their jobs were reasonably secure and that if they did become surplus to requirements they could rely on a particular level of compensation. I have not, for example, taken out any insurance against not being able to continue to pay my mortgage through loss of employment. The government’s plans for deficit reduction mean that civil service job security is now very questionable, whilst the Bill puts paid to the second part of my planning assumption. I feel unsettled and vulnerable at this unilateral change in what I had thought was the deal with my employer.”

From his words we get a clear sense of a bargain being broken, of a contract being unilaterally torn up and of people being treated as if they were expendable, which is particularly hurtful to many civil servants who have given many years of loyal service. His words also highlight the anxiety and uncertainty that permeates the civil service, particularly those who face a future in which they might not be able to work again.

As many have said in today’s debate, the lowest paid will suffer most, and there are many of them. The Minister for the Cabinet Office himself acknowledged that

“large numbers of civil servants are not very well paid—half of them earn £21,000 a year or less”.—[Official Report, 14 July 2010; Vol. 513, c. 932.]

Yet the scheme before us offers them no protection, and that is the key problem. Its proposals are fundamentally unfair and unjustifiable.

I should like to discuss the context of these changes, because the public sector already faces unprecedented uncertainty in the form of cuts and redundancies under the coalition’s policy of deepening and accelerating the previous Government’s cuts programme. Surely the very least that the public sector can expect is to be given a proper voice in negotiations and the chance to agree a fair settlement.

As with so many of the swingeing cuts on the table, there is a perception that the planned changes to the civil service compensation scheme are not just about saving money; they are also seen by many as an attack designed to weaken the public sector—the same public sector that, for now at any rate, is the backbone of our education system and health service. It also includes civil servants who keep up and running services such as Brighton county court family centre, the Brighton and Hove learning partnership and the city’s benefits service.

I end by pondering the irony of the fact that so many of the civil servants who will be adversely affected by the planned changes to the compensation scheme and to jobs, and by the service cuts, actually work for Her Majesty’s Revenue and Customs. Surely it would be much fairer to help reduce the national deficit by keeping those HMRC workers in their jobs and enabling them to collect and crack down on the £100 billion a year in unpaid and dodged taxes—tax evasion and tax avoidance. That would save public sector jobs and protect working conditions in the process.

In the meantime, it is clear tonight that many of us are not prepared to stand by and see the vast majority of the civil service pay disproportionately for the economic crisis. That is why I shall vote against the Bill.

21:11

[John Hemming (Birmingham, Yardley) (LD)]

I am 50 years old and have employed people for about half my life. My company was quite lucky relatively recently; we consulted with staff and were able to agree a deal under which there were no redundancies. However, I had to make redundancies in the early 2000s, and it is not a nice thing to go through, although obviously it is a lot worse to be made redundant.

We need to be aware that at the end of this process some people will lose their jobs. The challenge in politics is the national cake, and to some extent the political process can affect how that is divided. Our difficulty now is that we have to get a time machine and borrow from our children some slices that will be baked in future so that we can put them towards the national cake today. The real challenge is how we get, over a period of time, to the stage at which the amount of cake baked every year is the amount consumed every year.

How do we do that in a just manner? The Opposition have argued that our attempt unilaterally to challenge the contract with the civil service is unfair, whereas their attempt unilaterally to challenge the contract with the civil service was fair. They have argued with our proposals, but those are far more generous than the conditions for the staff of Members of Parliament, for instance. Those staff are all hard-working, but they are subject to the statutory redundancy scheme. Birmingham city council also operates the scheme. My wife works for British Waterways, a public body that also operates that scheme.

Basically, the Bill creates a negotiating position that means that the trade unions cannot veto any agreement. That is the normal situation for employers. Employers can present their staff with a new contract, and the staff have either to take it or leave it. That is what has happened in all the pay and grading reviews in local government across the country. Pretty well all local government employees have gone through the process of being presented with a new contract. What is happening now is that a new contract is being presented. We have said that we are aiming to protect the lower-paid. The most important thing to try to do is protect people against unnecessary redundancies. That is the critical thing.

If six years’ redundancy has to be paid to somebody, how can things be reorganised in a cost-effective manner? They cannot. Even paying three years’ redundancy creates a major problem because it costs more that year to make somebody redundant than to continue to employ them. That means that those not covered by the redundancy schemes are the ones to whom people go to find the savings. That does not seem fair.

[Chris Williamson]

The hon. Gentleman is arguing that we should indulge in a race to the bottom—it is about the lowest common denominator.

[John Hemming]

I do not think we should indulge in a race to the bottom. It needs to be recognised that this is the Government’s opening position. People who argue that we should propose the final solution here in Parliament are obviously no good at playing poker; one does not reveal one’s hand. We cannot expect the Minister to say, “We’ll settle for X.” The Government need to have a negotiating position, and the trade unions cannot be in a position whereby they can veto it—that would be absurd.

We need to think about our employees. I have always been concerned about the people whom I employ personally, and in the same way we should be concerned about those whom we employ collectively through UK plc. Options that may not cost the Government much money could be looked at to improve the situation. For example, constituents of mine who are civil servants have raised the issue of two civil servants living in the same household who are both under the threat of redundancy. I ask the Minister to consider whether it would be possible for one such civil servant to nominate the other, so that if one of them were made redundant the other would be protected against redundancy. Then at least the household would not lose both incomes, but only one. That would be an example of flexibility. It would not necessarily cost the Government any money, but it would protect people from the worst aspects of this process.

Similarly, in certain circumstances people might like to move towards a job share if the Government were willing to pay them a sum of money for that reorganisation, which might cost less than voluntary or compulsory redundancy. That would reduce the wages bill and the deficit without necessarily putting people in a very difficult personal position. We need to work with employees to try to minimise the effect on people.

[Mrs Mary Glindon (North Tyneside) (Lab)]

As a former PCS worker and someone who until April this year was earning £15,300—I worked in the Child Support Agency for 18 months—I find some of the things you are saying quite offensive. Every worker has a right to work—surely you do not make decisions about whether a husband or wife, or a partner in the household, has that right.

Furthermore, if the Bill is rejected tonight, proper consultation might be re-entered into. I took industrial action against our former Government. I voted for that action having been consulted by the union and following the procedure that the Government started with us in 2009. I e-mailed the then Minister and went through all that process. What you are saying is contradictory. You are saying that people should be consulted, but only after a decision has been made. Do you not think—

[Madam Deputy Speaker (Dawn Primarolo)]

Order. Address the Chair, and briefly, please.

[John Hemming]

I am suggesting that the Government could try to ensure that there are not two redundancies in the same household, whatever circumstances we are in. We all accept that redundancies are going to occur in the public sector, so why cannot we try to minimise the effect on households by ensuring that both partners need not be made redundant?

Similarly, there are opportunities whereby people can transfer to the private sector. Obviously the objective is to help people to find jobs in the private sector. A severance fee, equivalent to voluntary redundancy in some senses, paid when people find a job in the private sector could be a way of reducing costs to the public sector but doing so in a way that does not make public servants suffer. At the end of the day, we should be thinking about the effect on the public servants who work hard for this country. We need to recognise that and work in partnership with them.

There are all sorts of opportunities within my own company. I have had people take sabbaticals in the past. In certain circumstances the employer will say, “We can plan for that person to go away for a year and then come back.” It suits them to do that, it has reduced the cost to the public purse, and it is in the interests of the employee. Possibilities can be considered, in partnership with the work force, that improve the situation so that everybody wins.

As a consequence of the reduction in the national cake—gross domestic product or however one wishes to see it—we face a very difficult situation that has to be dealt with. The Labour party has proposed its own version of a unilateral contract change and we have a different version, but something needs to happen. I will support the Government tonight, because I agree with the exact proposals put forward in the Bill. We need a negotiating position so that the trade unions cannot veto any changes, and I have responded clearly to my constituents by saying that I do not think the trade unions should have a veto on contractual changes. The time has hit 20 minutes past, so I shall finish by saying that I shall support Second Reading.

21:20

[Katy Clark (North Ayrshire and Arran) (Lab)]

Thank you, Madam Deputy Speaker, for giving me the opportunity to make the last Back-Bench contribution to the debate. Some of the contributions that we have heard from the Government side of the House have been quite astonishing, and many of the civil servants who will be directly affected by what we are debating must have been amazed by some of the things that they have heard.

As always since the general election, coalition Members are trying to blame the economic policies of the previous Government for the economic crisis that the whole world has been in. I sometimes had different views from some of my Front-Bench colleagues about the economic strategies that I wanted the Labour Government to pursue, and in particular I would have liked them to intervene to regulate the banks earlier and deal with issues such as bankers’ bonuses and the financial sector. However, low-paid civil servants were not to blame for the economic downturn, nor indeed were the economic policies of the Labour Government.

We are here today debating not how to deal with the high pay of those in the banks, which have had huge public investment, or bankers’ bonuses or bank regulation, but issues associated with the estimated 600,000 public sector workers who will lose their jobs if the Government carry out the policy that they have outlined. Today we are talking about civil servants, but I believe that in a few weeks or months we will be back here talking about how the Government want to erode the terms and conditions of workers in other parts of the public sector as well. That is shameful, and it is particularly appalling that those on the lowest salaries in the public sector should have their terms and conditions eroded because of the difficult situation that we are in. It is also appalling economic policy, because in many parts of the country where civil servants and other public sector workers are going to lose their jobs, there are no other jobs available.

The Minister said that half of all civil servants affected by the scheme earned £21,000 or less, and the Government also seem to accept that the provisions in the Bill for those workers are not fair. They themselves say that they want to offer something better, although we have heard no detail today and have been asked simply to trust that the Minister will do what he can to get a better deal for those people.

We have to deal with the realities in the Bill as presented, and the reality is that the amount of money that many people get now if they are made compulsorily redundant or take voluntary redundancy in the public sector is not sufficient to take them through to the time when they can get another job. If the provisions in the Bill go through, they will lead to a lot of people living in poverty. People will lose their homes, as at least one Member described in outlining the circumstances of an individual civil servant, and they simply will not be able to cope. Those who will be in the most difficulties may well be those who would currently be entitled to three years’ compensation—older workers who have worked in the public sector for a very long time. In the world we live in, they will not be able to get another job. We all know the difficulties in which older workers find themselves when they seek alternative employment.

It may be that the current provisions are good for some individuals on the highest terms, conditions and pay, but if we compare jobs like for like, we will see that graduates who have worked hard for many years in the civil service probably would have received a better remuneration package had they worked in the private sector. At the same time, many of those on the lowest incomes, such as women cleaners and women who look after young children in nurseries, probably have a more attractive package in the public sector, because they earn more than the minimum wage, and have sick pay, pensions and protection provisions of the kind addressed in the Bill. Those are the people whom we should defend. We should not tell them that if they worked for the minimum wage for the worst private employer, they would have a worse deal than they have in the public sector. We should drive standards up, not use the current economic difficulties as an excuse to implement such policies. Some in the Conservative party who set the agenda wanted those policies irrespective of the economic conditions. I am therefore pleased to hear that some Liberal Democrat Members will take a stand on this matter. We are considering the Bill today only because many Conservative Members would impose such terms and conditions irrespective of the economic conditions.

The Bill will be fast-tracked through Parliament as a money Bill, which we should discuss, because it is just one of many measures that will erode the terms and conditions of some of the lowest paid in the public sector. In many of the communities that we represent, there will be devastation if the proposed cuts in public services happen. Facilities for which individuals and communities have fought for generations, including community centres and libraries, will close. There will be no alternative jobs for jobcentre workers who lose their jobs as a result of the Bill. I suspect that, if we do not pay for people to do jobs, it will cost the state a great deal more in benefits and other support that it must provide.

The Bill is wrong morally in that it effectively unilaterally changes contracts of employment, but it also bodes ill for the future. If that is how the Government intend to conduct industrial relations in the public sector, we have a very bumpy ride ahead. The comprehensive spending review is coming up, and civil servants know that many of their heads are on the block. They are distraught at the proposals. I hope that they go out after this debate and tell their representatives, particularly those on the Government Benches, how they feel about their policies. The Bill is not good for the public sector or the private sector, because it says that we need to take everybody down to the lowest standards and that it is okay to rip up contracts. People who have worked for an employer for 20 or 30 years may have done so on the understanding that they have a contractual entitlement to a particular package if they lose their job, but the Government believe that it is completely acceptable to come along, rip that up and say, “We’re going to give you a lot less.”

I hope the Government are defeated tonight. Even if they are not, they have a struggle ahead, and I hope that they are defeated when we debate the Bill again.

21:29

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

We have had a good and thorough debate, with some thoughtful and powerful contributions from Members on both sides of the House, including my hon. Friends the Members for Edinburgh East (Sheila Gilmore), for Glenrothes (Lindsay Roy), for Derby North (Chris Williamson) and for North Ayrshire and Arran (Katy Clark), as well as the hon. Member for Brighton, Pavilion (Caroline Lucas).

The difficulty that we face as we prepare to vote on this issue is that the words we have heard from the Dispatch Box are very different from those that are written in the Bill. On 14 July, the Minister for the Cabinet Office set out his approach to the reform of the civil service compensation scheme. He said:

“I want to engage with the unions quickly to develop a scheme that protects the lowest paid…we need to negotiate”.

When I pressed the Minister to take the previous Government’s reform package as the starting point for those negotiations, he accepted, as he did again at the Dispatch Box this afternoon, that had

“that scheme been in existence when the coalition Government came into office, a pressing case would have been made to leave it as it was and work on that basis.”—[Official Report, 14 July 2010; Vol. 513, c. 932.]

It was a good beginning, with an acknowledgement of the merits of the previous Government’s reform package, set out in February, and a clear undertaking to protect the lowest-paid.

Unfortunately, our hopes were dimmed when this draconian Bill was published just 24 hours later, with no prior consultation with staff or the trade unions. The Minister was open and transparent about the purpose of the Bill. He said that it is not the final word. Indeed, in a phrase echoed by my hon. Friend the Member for Birmingham, Erdington (Jack Dromey), the Minister described the Bill as a “blunt instrument”. It contains a sunset clause and powers to repeal at any stage. In no sense is it a reformed scheme: it simply places a cap on the existing unreformed scheme. It means, typically, that a civil servant earning £21,000 a year who is made compulsorily redundant and who would get £63,000 under the existing scheme—and would have got £60,000 under the February 2010 scheme—will get just £21,000. Someone earning £18,000 who would have got £54,000 under the existing scheme or the February 2010 scheme, will get just £18,000.

The truth, which has been freely acknowledged by Ministers, is that the Bill is a negotiating device to ensure drastic cuts in the civil service compensation scheme. But as legislators we have to ask what will happen if those negotiations do not succeed. The Chair of the Public Administration Committee, in a thoughtful speech, warned about the dangers that might lie ahead in terms of legal challenge and delay. It is good to know that he and his Committee will keep a watchful eye on this legislation and other matters.

My hon. Friend the Member for Hayes and Harlington (John McDonnell), who chairs the PCS parliamentary group, has described this Bill as a landmine Bill, and he set out his definition of that. Whether that is true or not, there are real dangers if this Bill passes through Parliament while parallel negotiations go on outside that remain uncertain and, if unsuccessful, could create real resentment among those whom they affect.

There is no argument from my party about the need for reform. Indeed, we engaged in considerable detail in those reforms before the election. The focus of our reform was the vast majority of civil servants who do vital work on the front line of our public services. They include those who work in jobcentres trying to reconnect unemployed people with work; those who work in our prisons dealing with difficult and dangerous offenders and ensuring that our communities are safe places to live; and those who deal with tax credit claimants, ensuring that families have at least a decent minimum income on which to live. Most of those people, as we have heard from many hon. Members, work for modest rewards. Indeed, the Minister has said on several occasions that half of all civil servants earn £21,000 a year or less.

I genuinely want to give the right hon. Gentleman the benefit of the doubt—that is my starting point. I want it to be true when he keeps repeating the claim he makes in the Chamber and the media that he wants to protect the lowest-paid, but at some point those words have to turn into action, and he has to put flesh on the bones. My real concern this afternoon is that his comments have raised expectations above anything that his Government are likely or willing to deliver.

In particular, I urge the right hon. Gentleman and his ministerial colleague, the Parliamentary Secretary, Cabinet Office, the hon. Member for Ruislip, Northwood and Pinner (Mr Hurd), to look again at the proposal that the previous Government agreed with five of the six trade unions, and which even now could provide a realistic, practical starting point for negotiation with all six of the unions—namely, that any civil servant on a salary of less than £20,000 a year who is made redundant would be entitled not to 12 months’ or 15 months’ salary, but to three years’ salary. Labour Members will be tabling an amendment to that effect in Committee, and I encourage the Minister to indicate this evening that he and his colleagues will, when that moment comes, show that they mean what they say when they talk about protecting the low-paid and support that amendment. At the very least, that would be a clear indication, in their discussions and negotiations with the trade unions, that they are acting in good faith and mean it when they say that they want to protect the lowest-paid.

My hon. Friend the Member for East Kilbride, Strathaven and Lesmahagow (Mr McCann) was among a number of Members on both sides of the House who reminded us that this debate and these proposals come before us in the context of deficit reduction, so it is important to remind the House, as my right hon. Friend the Member for Dulwich and West Norwood (Tessa Jowell) made clear, that our reform package would have saved £500 million over three years. The Government have pledged that, however tough life becomes as a result of the cuts that they introduce, fairness will be the watchword. How many times have we heard that from the Government Front-Bench team? But what is fair about the regressive provisions in the Bill that mean that maximum redundancy payments mirror exactly what an individual earns? If someone earns £100,000 a year, under the terms of the Bill their payment would be £100,000. If someone earns £50,000, the payment would be £50,000. And if someone earns £20,000, it would be £20,000, not the £60,000 promised in the reform package that we negotiated and set out in February.

What is fair about a set of negotiations carried out against the backdrop of a Bill that threatens severe cuts if the trade unions do not agree to a new scheme that dramatically reduces the provisions in the civil service compensation scheme? And what can be fair, as the hon. Member for Southport (Dr Pugh) asked pointedly, about unilaterally rewriting a contract with staff, either from a moral or even perhaps a legal standpoint?

[Mr Reid]

I agree with much of what the right hon. Gentleman is saying, but surely the Labour party believes in reforming the present system, so should it not be supporting the Bill on Second Reading, moving its amendment and then voting against it on Third Reading only if that amendment fails?

[Paul Goggins]

Absolutely not. Our starting point is, and the Government’s starting point should be, the February 2010 proposals agreed by the then Government with five of the six trade unions, not this miserable backstop provision in the Bill.

[Martin Horwood]

rose—

[Paul Goggins]

I will take one more intervention, but the Minister wants to wind up and we have to reflect the debate, which has been a good debate. However, I will happily give way.

[Martin Horwood]

Is the right hon. Gentleman seriously suggesting that the starting point for this process should be something that has already been declared illegal?

[Paul Goggins]

The reasons it was declared illegal relate to the standing of the original legislation—the Superannuation Act 1972—and there is nothing preventing the Minister for the Cabinet Office and his colleague the hon. Member for Ruislip, Northwood and Pinner from sitting down tomorrow with the six trade unions and taking our February 2010 proposals as the starting point for negotiations. I urge the right hon. Gentleman to do that—he is in his place now. I was just reminding the House that he accepted that had the proposals gone through before the election, there would have been a pressing case for leaving it well alone. We are where we are, but it is fair to suggest that that could be the starting point for negotiation.

I ask again: what is fair about sending a message to loyal, dedicated, hard-working staff that they would be better off if they decided to go voluntarily, rather than staying in the job that they are committed to and running the risk of being made redundant compulsorily, resulting in a 20% reduction in the payment that they would receive? My hon. Friend the Member for South Down (Ms Ritchie) asked what was fair about deep cuts in the conditions of staff who run the very services on which those with the least in our society depend, including jobcentre staff and those who deal with tax credit claims.

I shall turn now to what I regard as the misuse of a Bill in the pursuit of these draconian changes to the civil service compensation scheme. I particularly commend the pertinent comments made by my hon. Friend the Member for Kilmarnock and Loudoun (Cathy Jamieson), who has considerable experience as a Minister in Scotland. Mr Speaker, you will be pleased to know that I shall not comment on whether or not this should be a money Bill. I am sure that you will take advice on that and make your decision when the Bill finishes its proceedings in this place. I am sure that you will not need advice from me; you will get it from others.

Having heard the promise of so many reforms and changes, it was bizarre, so early in this Parliament, to hear Ministers openly saying that they hoped they would never need to use the Bill. How bizarre is that, so early in the Parliament? Government Bills should be about putting policy into legislation, not about providing negotiators with a backstop bargaining chip, especially when so much about the Bill remains unclear and uncertain. The 12-month and 15-month caps are entirely arbitrary; they have been plucked out of the air. No rational explanation has been given, and no evidence brought forward, to explain why those time periods have been chosen. The equality impact assessment does not even acknowledge the potential impact on older and longer-serving civil servants, who stand to lose huge sums of money and who might very well be those who find it the most difficult to find alternative employment.

Ministers cannot tell the House how much money would be saved as a result of the Bill, because they do not yet know how many civil servants will be made redundant as a result of their cuts. Perhaps the Minister could say a little more in his winding-up speech about the negotiations. I recognise the constraints involved, and I do not expect him to carry out negotiations across the Dispatch Box this evening, but even an indication about the mood of the negotiations would assist hon. Members. Are Ministers close to agreement? Does the Minister believe that the Bill will actually be needed? When are the next meetings scheduled to take place? Does he expect to be able to come back after the conference recess and tell us on Report that substantial progress has been made, and that we might not need the Bill after all? If he is not going to table amendments when the Bill goes into Committee—the Minister for the Cabinet Office indicated that it was not his intention to do so—will he heed the advice of the hon. Member for Vale of Glamorgan (Alun Cairns) that he should go as far as he can to indicate the kind of measures that he and his colleagues are considering?

My hon. Friend the Member for Hayes and Harlington is right: it is unacceptable to expect hon. Members to vote for a Bill that is so far-reaching in its impact without knowing the detail of the provisions that sit beside it. If the Minister cannot go a little further in providing that detail, I believe that any sensible Member will be forced to conclude that words about fairness are just that, and that the only way to vote tonight is in favour of the reasoned amendment and against the Bill.

21:44

[The Parliamentary Secretary, Cabinet Office (Mr Nick Hurd)]

This has been a serious debate. It has been very sober in tone, and that is entirely right because we all know that there is tremendous anxiety out there about job losses and potential changes to the compensation scheme. Many Members have received representations on this matter, and many came to the House today to express strong constituency interests. They included my hon. Friends the Members for Cheltenham (Martin Horwood), for Stafford (Jeremy Lefroy) and for Vale of Glamorgan (Alun Cairns), and they represented those interests very strongly.

What was striking as I listened to the debate was the consensus about the need for reform. That was not seriously questioned. The issue before us, then, is how, in seeking to reform the compensation scheme, we strike the right balance in treating fairly civil servants who lose their jobs or give them up voluntarily. As was stressed consistently throughout the debate, particularly by my hon. Friend the Member for Gloucester (Richard Graham), the issue is especially important to the large number of civil servants who are not well paid. How do we strike the right balance between being fair to them and discharging our responsibility to the taxpayer at a time when there is tremendous pressure on the Government to get public spending under control, as my hon. Friend the Member for South Staffordshire (Gavin Williamson) emphasised? My hon. Friend the Member for West Suffolk (Matthew Hancock) was entirely right to introduce the concept of fairness to future generations when talking about the need to get the deficit under control and tackle it with vigour.

As for the case for change, my right hon. Friend the Minister for the Cabinet Office made the Government’s starting position very clear. This legislation is not an attack on the civil service. Many Members have placed on the record their appreciation of the crucial work undertaken by civil and public servants every day and across all Government Departments, and no one recognises that more than a young, new Minister with no experience of Government who relies on civil servants and the dedication and support that they give.

We simply believe that the current arrangements for compensating civil servants are unaffordable and unsustainable. My hon. Friends the Members for West Worcestershire (Harriett Baldwin) and for Vale of Glamorgan were right to express the surprise that their constituents would feel on understanding that in this day and age public servants are eligible to receive payment of up to three times their annual salary or, for older workers, enhancements to pensions and lump sum payments costing more than five times their salaries. That seems disconnected from constituents’ experience of the real world, disconnected from statutory terms—a point well made by the hon. Member for Birmingham, Yardley (John Hemming)—and clearly out of kilter with terms in the private sector, as my hon. Friend the Member for Devizes (Claire Perry) argued.

The view of the coalition Government is that the status quo is unacceptable. As we made clear in the coalition programme, we want to bring this scheme more closely into line with that of the private sector. Critically, that view was shared by the previous Government, who tried to reform the scheme honestly, but ultimately without success. That view was apparently shared by five of the six unions involved in the negotiations, as they agreed to the package on offer. The case for change seems to have been accepted by the majority of speakers.

On affordability grounds alone, a responsible Government dealt the hand that we have been dealt on the public finances would have had to take action. As my hon. Friend the Member for West Worcestershire pointed out, there is also a risk of the current situation distorting decisions and creating unfairness. We do not want to take decisions on people’s future based on how easy or cheap it is to make them redundant. The effect of the current scheme is to make it particularly expensive to make the highest-paid public servants redundant. We do not want uncertainty to drag on, as it is bad for everyone and will breed only more insecurity. We want the uncertainty to end decisively.

As I said, I heard no serious arguments against reform. The debate on the Opposition side, honest as it was, was mostly about process and how the Government are going about this business. Strong reservations were made about the possible certification of the legislation as a money Bill, but that is clearly a matter and a judgment for you, Mr Speaker, at the end of the Bill’s passage.

My hon. Friend the Member for Harwich and North Essex (Mr Jenkin), the Chairman of the Public Administration Committee, raised concerns about the risk of a legal challenge to the Government’s approach and wanted comfort on the robustness of our legal advice. He will be aware that trade union members and some hon. Members have placed on record the risk of a legal challenge, so he will not expect me to go into the details of the legal advice. I can confirm, however, that it is robust.

The main argument from Labour Members was, “Why not go back to the deal that was almost struck? Why not amend the legislation so as to impose the terms agreed with the five unions earlier this year?” The truth is that the previously agreed terms were struck down by the courts and were not accepted by the Council of Civil Service Unions. Although those terms had much to recommend them, we would prefer not to see some aspects in the new scheme—for example, compulsory terms more generous than those on voluntary departure. Rather than embedding the scheme in primary legislation, we have sought to limit the costs of the current scheme while discussing the contents of a new scheme.

While I understand the concerns expressed by many Members about process, I believe that there is a danger of missing the central point. Reform is necessary—the status quo is not an option—and we want to achieve reform through negotiation. The Minister for the Cabinet Office has informed the House of his meetings with the Council of Civil Service Unions on 13 July, and of an imminent meeting. There are ongoing discussions almost daily, which he has described as genuine and sustained. We have sent a clear signal of flexibility on terms for voluntary redundancy, and have expressed a clear determination—this will be important to the House, given the concerns that have been expressed—to agree on terms that are fair to the lower paid. The model that we are exploring seeks to taper the protection given to the very lowest paid, but the limits and thresholds of such protection are clearly a matter for detailed negotiation, and should not be the subject of speculation in the House.

Why is the Bill necessary? It is necessary until we can reach an agreement with all the unions, because the current position enables them to veto any meaningful reform—a point grasped by the hon. Member for Birmingham, Yardley and many others—and they have demonstrated a willingness to use that power. Until we have secured agreement, we would be failing in our duty to the taxpayer if we retained the status quo and did not address the excesses.

The Bill does not itself introduce a new scheme, but merely limits the amounts that can be paid out under the terms of the current scheme. We have made it clear that those limited amounts represent the absolute minimum that the Government are prepared to offer staff. My hon. Friend the Member for Harwich and North Essex described that as an austere statutory base, but what was not mentioned was that the Bill makes it possible to adjust the amounts in one direction only, namely upwards. The Government seek to provide an example for other employees on good practice in relation to staff issues, and therefore have no desire to limit payments to the statutory minimum. The Bill caps the amounts to be received by staff departing on voluntary terms to payments calculated under the current terms, but limited to a maximum of 15 months’ pay. For those who are formally dismissed, the limit will be 12 months’ pay.

The Bill contains a sunset clause, and its effect can be brought to an early end if we are able to agree on a new scheme. We genuinely hope that that will happen. My hon. Friend the Member for Harwich and North Essex asked about the need for a sunrise clause as well as the sunset clause. I think it is impossible for us to be sure of every circumstance that could lead to a need to revive the Bill. The Government are therefore keen to maximise their negotiating flexibility. If we are unable to agree on a new scheme with the unions, the Minister for the Cabinet Office will have to renew the caps every six months by affirmative resolution.

The tone of the debate was extremely serious and consensual when it came to the need for reform, but I took exception to the suggestion by some Labour Members that the Government had no sensitivity in relation to the human consequences that might be forced on them. Labour Members chortle, but that suggestion is offensive to any Member on this side of the House. I do not think that anyone goes into politics to make other people redundant, except their direct political opponents. It is deeply offensive to ascribe the wrong motives to the Government. The coalition’s priority is to reach a long-term agreement on a new scheme with all the unions involved: an agreement that is fair to the civil service and fair to the taxpayer. The Bill is needed in case we are unable to reach such an agreement. It introduces caps so that we can limit the costs of the current scheme while we discuss the content of the new scheme.

[John McDonnell]

I do not intend to embark on any party-political knockabout during the last few minutes of the debate. A key issue raised was process, which is important because it can demonstrate fairness. One of the failures of the House in the past has been the way in which it has rushed through legislation. A lack of scrutiny, both here and in the other Chamber, undermines the potential for good legislation.

The Speaker will determine whether this is a money Bill, but the Government have designated it thus, and I should be grateful if the Minister would clarify the reason for that. Given the definition in “Erskine May” of a money Bill, I see no reason why a Superannuation Bill can be so designated. I think it would be useful to rehearse the arguments in front of the Speaker, so that a wise decision can be made.

[Mr Hurd]

I understand the argument. It is based on the fact that this is about money and public expenditure, but as the hon. Gentleman knows the main point is that my view is irrelevant because it is the judgment of the Speaker that counts and the Speaker will make his judgment before the Bill completes its passage through Parliament. It is ultimately a matter for the Speaker to decide.

[Matthew Hancock]

Whatever the result of the vote on the amendment, the Minister is right to say that the tone of the debate all day has been in favour of reform of some kind, so is he as surprised as I am that we have just heard from the Opposition Front Bench that they will vote against the whole Bill, which means they will be voting in favour of £500,000 payouts to some at a time of such economic difficulty?

[Mr Hurd]

My hon. Friend makes an important point about the lack of coherence in the Opposition’s position. They have set out clearly, and confirmed today, that they recognise the need for reform—and we have paid full tribute to the very honest effort they made when in government to reach an agreement. They recognise the reality of the situation, which is that effectively one union is holding the situation and the process hostage, and in all responsibility to the taxpayer we cannot let that continue. We have to break the deadlock, and that is the purpose of this Bill. It is needed in case we are unable to reach an agreement with the unions. It introduces caps so that we can limit the costs of the current scheme and we can go about the very serious business of reducing public expenditure while we discuss the contents of the new scheme. The critical point is that the Government’s aim is to reach an agreement that is sustainable through negotiation. Those negotiations are ongoing and vigorous, and they are being held in good faith.

[Mr Jenkin]

Will my hon. Friend take this opportunity to correct the Opposition on one other point, which is that it would not in fact be possible to return to the February settlement because that has, effectively, been nullified by the courts? Even if all the unions now agreed to the February settlement, that settlement has been kyboshed by the courts, and even if they had agreed to it at the time, had there been a challenge in the courts and it had been successful—and it would have been—that would have nullified the settlement. This Bill is therefore indispensible.

[Mr Hurd]

My hon. Friend makes an extremely good point and he states a fact that I have placed on the record before: that the previously agreed terms were struck down by the courts and were not accepted by the Council of Civil Service Unions. The deal failed, and there is no guarantee that it would succeed in future.

[Paul Goggins]

It is important to be clear about this. The ruling was not about the content of what was proposed by the previous Government and agreed by five of the unions; it was about the fact that the legislation did not allow the Government to compel the solution. It is important that Members are clear about that before they vote tonight.

[Mr Hurd]

And our intention is to negotiate an agreement. This Bill is not the endgame. It is an interim measure which we hope to repeal as soon as possible, and it is on that basis that I commend the Bill to the House.

Question put, That the amendment be made.

21:59

Division 54

Ayes: 240

---

Labour: 226
Democratic Unionist Party: 6
Social Democratic & Labour Party: 3
Scottish National Party: 3
Plaid Cymru: 2
Independent: 1
Green Party: 1

Noes: 329

---

Conservative: 282
Liberal Democrat: 47

Question put forthwith (Standing Order No. 62(2)), That the Bill be now read a Second time.

22:14

Division 55

Ayes: 326

---

Conservative: 284
Liberal Democrat: 42

Noes: 244

---

Labour: 225
Democratic Unionist Party: 6
Liberal Democrat: 4
Scottish National Party: 4
Social Democratic & Labour Party: 3
Plaid Cymru: 2
Independent: 1
Green Party: 1

Bill read a Second time.

Superannuation Bill (Programme)

Tuesday 7th September 2010 Commons Chamber

Motion made, and Question put forthwith, (Standing Order No. 83A(7)),

That the following provisions shall apply to the Superannuation Bill:

Committal

1. The Bill shall be committed to a Public Bill Committee.

Proceedings in Public Bill Committee

2. Proceedings in the Public Bill Committee shall (so far as not previously concluded) be brought to a conclusion on Thursday 16 September 2010.

3. The Public Bill Committee shall have leave to sit twice on the first day on which it meets.

Consideration and Third Reading

4. Proceedings on consideration shall (so far as not previously concluded) be brought to a conclusion three hours after the commencement of those proceedings.

5. Proceedings on Third Reading shall (so far as not previously concluded) be brought to a conclusion four hours after the commencement of proceedings on consideration.

6. Standing Order No. 83B (Programming committees) shall not apply to proceedings on consideration and Third Reading. —(Jeremy Wright.)

22:28

Division 56

Ayes: 307

---

Conservative: 277
Liberal Democrat: 40

Noes: 244

---

Labour: 220
Liberal Democrat: 7
Democratic Unionist Party: 6
Scottish National Party: 4
Social Democratic & Labour Party: 3
Conservative: 2
Plaid Cymru: 2
Independent: 1
Green Party: 1

Crayford Station (Access)

Tuesday 7th September 2010 Commons Chamber

Motion made, and Question proposed, That this House do now adjourn.—(Jeremy Wright.)

22:43

[Mr David Evennett (Bexleyheath and Crayford) (Con)]

I welcome the opportunity to raise my concerns and those of my constituents about the decision taken by Southeastern not to proceed with plans to create step-free access at Crayford station in my constituency.

Southeastern was presented with a simple, cost-effective scheme that could have been implemented quickly and would have made a real difference to commuters and others. Its decision not to proceed, motivated purely by money and fare revenue, will cause continued inconvenience to rail travellers with mobility problems, particularly the elderly and families with pushchairs. I am really disappointed that Southeastern is letting down so many vulnerable customers.

By way of background, I shall explain that Crayford station is one of four stations located in my constituency, the others being Bexleyheath, Barnehurst and Slade Green. There are eight others located around the borough that Bexley residents also use. Each of those stations is operated by Southeastern as part of the integrated Kent franchise.

Crayford is a zone 6 station used for about 1.3 million journeys every year, serving London Charing Cross and London Cannon Street. Although 40,000 fewer people used Crayford station last year due to the recession, many more people—some 300,000—are using the station than did so in 2003-04. That is partly due to new developments and investment in Crayford town, which has been transformed over the past 20 years. With new housing developments such as Braeburn Park and regeneration projects such as the retail park and the greyhound stadium, more people are living and working in the town. There are further developments under way, such as those at the back of Crayford town hall, the plans for the former Samas Roneo factory site in Maiden lane, and the new Crayford academy, which is currently under construction in Iron Mill lane. That will increase the number of people who live in the area and who have the opportunity to commute or travel from Crayford station, and it is great news for the town, which is a historic and distinct town that is growing and improving. As part of the London borough of Bexley, it is a desirable place to live and work.

To be fair, the station has been partially upgraded, but with a relatively small further improvement, it could transform the opportunities for, and the ability of, those with mobility difficulties to use public transport. The Minister will know that following a successful campaign to have step-free access installed at Barnehurst station, I was contacted by many of my constituents, particularly Mrs Barbara Gray, as well as by local councillors Melvin Seymour, Howard Marriner and Eileen Pallen, who like me are concerned about the lack of step-free access at Crayford station.

The London-bound platform at Crayford is step free, but the Kent-bound platform 2 is accessible only via a footbridge back to platform 1 over the railway line. With Crayford growing and attracting new firms and residents, the existing provisions are not satisfactory. At peak times, there is a vast queue to get over the bridge, which causes further problems, and means that those with mobility problems must wait still longer.

Crayford line commuters are therefore undoubtedly at a disadvantage when it comes to step-free access. Of the stations in and around Bexley that trains on that line call at, Crayford is not fully step free, nor is Bexley, which is the next station up, and nor is Albany Park. The first step-free station towards London is Sidcup. On the Bexleyheath line, however, Barnehurst, Bexleyheath and Welling stations are all step free, and only Falconwood is not. There is therefore a great disadvantage for vulnerable travellers on the Crayford line, many of whom are my constituents, although some are resident in the constituency of my hon. Friend the Member for Dartford (Gareth Johnson), who is indeed my long-time and good friend, and who I am pleased to see in the Chamber this evening.

[Gareth Johnson (Dartford) (Con)]

My hon. Friend feels particularly strongly about this issue and is a passionate supporter of transport links into Crayford, and I congratulate him on securing this debate. Does he agree that the priority for Southeastern must be to ensure that passengers are able properly to use the facilities at Crayford station, and that in particular, we need Southeastern to show respect to those passengers who have mobility difficulties?

[Mr Evennett]

My hon. Friend is absolutely right, and he has taken the opportunity tonight to make that point, as I have, and I hope the Minister will be sympathetic. Southeastern must address those issues for the benefit of those who are less mobile, so that they can use public transport, which we want.

Government funding is, I understand, available for step-free access. The Department for Transport website states:

“The Access for All Programme is part of the Railways for All Strategy, launched in 2006 to address the issues faced by disabled passengers using railway stations in Great Britain. Central to the Strategy is the ring-fencing of”

a certain amount of money

“until 2015, for provision of an obstacle free, accessible route to and between platforms at priority stations.”

As you would expect me to say, Mr Speaker, I think that Crayford is a priority station. I also understand that Access for All small schemes funding is available for smaller work programmes such as the one that I propose for Crayford. That is worth up to £250,000 a project, and is a contribution of 50% towards the total cost of the works.

[Mark Reckless (Rochester and Strood) (Con)]

On funding, our constituents who use the Southeastern trains service have particularly high expectations, and investment in the service is quite justified, because for reasons that I do not fully understand, Southeastern was singled out by the previous Government for RPI plus three rather than RPI plus one increases.

[Mr Evennett]

My hon. Friend makes a good point, on which I will elaborate later in my speech.

I contacted Southeastern about the issue of step-free access at Crayford in May 2009. I was told that Crayford was not included in its works programme for step-free access. Instead, I was offered a telephone number for constituents to call if they wanted help at the station or to get a taxi from the nearest fully accessible station. Helping commuters off the train with a ramp is obviously a good thing, but I do not know whether someone would actually carry a wheelchair over the footbridge to get it to the other side. That is a considerable number of steps, and certainly I have not had any experience of my constituents being offered that service. This means that rail users with mobility problems travelling in Kent would have to go to Dartford station to catch or get off a train. That is not always convenient as it is two miles away from Crayford station.

I was also concerned that I had not seen advertised the telephone number that Southeastern gave me for people with mobility problems to use. So I vigorously pursued the matter, met Mark Gibson of Southeastern at the station and highlighted the problem in person, so that he could see it first hand. I also showed him that there was already step-free access at the side of platform 2, because there was a footpath and a gate that had been used in the past. This gate had been locked to commuters for some time and, regrettably, the footpath had been allowed to deteriorate into a state of disrepair. In my opinion, unlocking the gate and resurfacing the footpath could solve the issue of step-free access quickly, effectively and cheaply. As we all know, money is tight these days and public expenditure tough, but very little money would be needed to open up that opportunity.

It came to light through subsequent correspondence in June and July 2009 with Bexley council that the land that this access point would be on was now owned by Sainsbury’s, whose store is near the station, and that the council was exploring options to achieve access over the land. I met a representative of Sainsbury’s later in the year, Ben Littman, who was very positive about the scheme. I was advised that the land over which access was necessary would be transferred to Bexley council’s ownership as part of an agreement relating to Sainsbury’s planning application to extend its store, subject to the necessary surveys and permission. I also learned from the council, not the train company, that £55,000 had been allocated to Southeastern from the national station improvement programme for the scheme, so at this stage—as the Minister will appreciate—things looked positive.

Southeastern had been provided with a simple, cost-effective proposal, supported by me, Sainsbury’s, constituents and local councillors; permission for access over the land required for the scheme; a gate already in place; the basis of a footpath; and funding from Network Rail to deliver step-free access. It should have been so simple. Unfortunately, I heard nothing further from Southeastern about the project for some time. What I discovered later was that due to its concerns about lost revenue, it had already decided not to proceed with the scheme. Despite having been allocated £55,000, it was concerned that it would have to spend money on automatic barriers and an Oyster reader system, which would have cost more than the £55,000 allocated, and employ an additional member of staff. But not to worry, it provided me with the same telephone number for constituents that it had given me more than a year before. I am appalled by the lack of concern for passengers that this attitude displays.

The justification offered by Southeastern for its decision not to proceed does not stand up to scrutiny, and that is why I am grateful for the opportunity to raise these issues in this Adjournment debate. I believe that the continued lack of step-free access at Crayford station, which Southeastern had the opportunity to rectify and failed to do so, is a disgrace of which it should be ashamed.

Southeastern claims that automated barriers are required in order to protect fare revenue. It has not provided any estimates as to how much this lost fare revenue is worth and alludes only to its studies. However, I pointed out that when it installed step-free access at Barnehurst station a couple of miles up the road on a different line, following my successful campaign, it did not put in automatic barriers. I also noted that an uncontrolled access gate to Crayford station’s platform 1 was routinely left open for people to walk in and out. So it was all right on one side, but not on the other side of the station, which I thought was very strange. It could not justify to me why the situations were different. I have learned that, since I have been commenting on this issue, it has now quite cynically stopped leaving open the uncontrolled access to platform 1—it has now been locked as well. That is very strange, is it not?

Fare revenue is obviously important to Southeastern, and it claims that the cost of installing automatic barriers would have been prohibitive. I asked how much it would cost over and above the £55,000 it has already been allocated, but I did not get a direct answer other than, “It would probably cost about £12,000”. It could not provide an accurate estimate of the cost of installing an automatic barrier with the appropriate cabling, although it thought it would be up to about £100,000. I do not believe the barrier is necessary. In my opinion, it is another red herring. Last year, the Southeastern parent group took over about £1.5 billion in rail revenues, and its operating profit is quite considerable as well. Given the public subsidy, the consistent growth in fare revenue—I note that passenger revenues rose considerably in 2008 and 2009—and the fact that it is making an operating profit in a difficult economic climate, I find it hard to believe that it could not find the small amount of money that would allow it to transform the opportunities for people with disabilities to travel on its trains.

Another reason Southeastern highlighted was that the barriers were necessary to prevent antisocial behaviour and vandalism at the station, but that did not apply in Barnehurst station, where it said that it did not matter at all. I think its reasoning is inconsistent and that it is holding a negative view of Crayford residents—one that I totally disagree with and think is an insult to the people of Crayford. That said, of course, communication is definitely not Southeastern’s strong point. I found out about the funding—or the lack of it—and its cancellation from Bexley council, not from Southeastern.

Why would Southeastern not tell me that it was cancelling the project, unless it was afraid of being held to account for its decision? I am advised that the money that Southeastern was given for step-free access is to be delivered to other stations, but it would not tell me which ones. Bromley has been mentioned as a possibility, but a quick look on the Access for All website shows that it was due to get money for that project anyway, so I am still at a loss to know what has happened to the money originally promised to Crayford. I also understand that Crayford was awarded £51,000 in 2007, under the Access for All small grant scheme, to provide level access from the road to the downside platform by resurfacing the disused station approach and installing lighting. So the money was there, but Southeastern chose not to use it, which again is disappointing.

I must mention as a sideline that Southeastern has shown a similarly poor attitude to helping vulnerable commuters at Slade Green station, which is also in my constituency. That is a different station with a different problem. It has step-free access to each platform, but because of the layout of the surrounding area, it is difficult to make the journey from one side of the platform via the road to the other platform. Earlier this year, I met the representatives of the Bexley association for disabled people, who are concerned about access for the disabled at this station. Some of the things there are also simple to resolve. There are no ramps on to the pavement from the set-down area, and there are steps from the bus stop to the set-down area meaning that those with mobility problems have a difficult problem as well. The footbridge is also a problem because it is sloped like a ramp, and it is quite difficult for disabled people to go up and down it.

Again, the response from Southeastern was not encouraging. I was given information that I already knew and was advised that there was an Access for All scheme, but again larger stations got priority. I got the same information about the telephone numbers, so I now have it printed indelibly in my memory. I appreciate that money is an issue for Southeastern, but I think that investment in passengers and the benefit of passengers should be its top priority.

I would like to briefly mention the comment by my hon. Friend the Member for Rochester and Strood (Mark Reckless) about how fares have gone up dramatically and how it was under the last Labour Government that Southeastern was given a derogation to increase fares considerably above the rate of inflation, which has meant that commuters from Crayford and Slade Green have paid considerably more for the same journey. Yet they have not been accommodated when it comes to step-free access or helping people with disabilities to use the station facilities. Now that we know the July rate of the retail prices index, I am naturally concerned as to what the rate increase will be in January for commuters travelling from my constituency. I want to put on record that the Labour Government’s allowing huge rises on top of inflation was totally unacceptable and unfair to people in my area.

As I have highlighted at some length, this is an important issue for me and for the people who live in Crayford. I cannot understand why we have been unable to get such a simple improvement, which would transform the opportunities for those with mobility problems. They should not have to have extra help, or travel to another station. They should be able to get on and off the trains at their own station, and to commute up to London or out into Kent as they wish. Step-free access would transform the situation, especially at a time when we are encouraging more people to use public transport. It is essential that we give people the opportunity to get on and off the platforms, so that they can use public transport. I urge Southeastern to look again at its decision. Others—the council, businesses and other organisations—are investing in the future of Crayford, and I believe that Southeastern should do the same. I very much hope that my hon. Friend the Minister will agree with me, and that he will use his considerable influence to help us to get step-free access for my constituents at Crayford station.

23:01

[The Parliamentary Under-Secretary of State for Transport (Norman Baker)]

I congratulate my hon. Friend the Member for Bexleyheath and Crayford (Mr Evennett) on securing this debate on this important issue for his constituents. I also welcome the supportive comments made by the hon. Members for Dartford (Gareth Johnson) and for Rochester and Strood (Mark Reckless). In response, I would like to set out the measures that the Government are putting in place to improve access to rail travel for people with reduced mobility. While I have this opportunity, I also want to explain the particular circumstances which, unfortunately, have so far prevented enhancement plans for Crayford from being achieved.

The provision of a modern, accessible public transport system in which disabled people have the same opportunities to travel as other members of society is key to improving the life chances of disabled people, promoting social inclusion and making it easier for older people to work or volunteer. We are fully aware that, without accessible transport, disabled people are limited in their ability to access work, to visit friends and family, to participate in leisure activities or to use essential services such as health care and education facilities. That is why successive Governments have taken strong action to ensure that public transport services are increasingly accessible to the large population of disabled people who live in Great Britain, and I believe that the UK’s record in this area speaks for itself. I might also add that these issues affect not only disabled people: when I first became a father, the need to carry the buggy brought home to me just how many steps there were in railway stations.

When the railways first arrived in Crayford in the 1860s, they symbolised the future of transport. They were fast, reasonably comfortable and cheap to use. Unfortunately, 19th century railways were not built with the needs of 21st century travellers in mind, and it is only in recent years that serious attention has been paid to making stations more accessible. As my hon. Friend mentioned, the previous Government published the Railways for All strategy in 2006, which set out what the rail industry as a whole was doing to improve access to rail services, particularly for disabled people.

The coalition Government understand the importance of rail stations to passengers’ overall journeys and place the highest value on promoting equality and fairness. We realise that accessible stations make a huge difference to people’s journey experience, and we remain committed to making further improvements. To date, 148 stations across England, Wales and Scotland have been targeted to receive main scheme funding for an accessible route to and between their platforms. I am pleased to report that the Access for All programme described in the strategy is rolling out across the network, with accessible routes already installed at 42 stations, which are now complete, and good progress being made on the programme nationally. By the end of the current financial year, we expect a total of 65 stations to have been completed.

The busiest stations have been prioritised, as improving these will benefit the largest number of people. The stations have been chosen on the basis of Office of Rail Regulation station usage statistics, weighted by the incidence of disability in the local area based on the 2001 census. As a result, the investment is being targeted at the busier stations in areas with a higher proportion of disabled people. A proportion of the stations were also selected to ensure a fair geographical spread across the country.

As my hon. Friend will know, however, Crayford station was not selected in the main scheme programme. However, since 2006, small schemes funding has also been made available, for which local authorities, train operating companies and other interested groups can bid, to make smaller scale or locally focused access improvements to stations. In total, the small schemes programme has provided almost £25 million of match funding towards investment of almost £100 million supporting improvements to meet local needs at more than 1,000 stations.

As my hon. Friend says, Crayford station already has a level access route to the upside platform. We believe, as he does, that a step-free route could be provided relatively easily to the downside platform as well by resurfacing and making good the disused station approach road. As he knows, in 2007 Southeastern successfully applied for £51,000 of departmental funding towards a project estimated at £102,000 to make this a reality. I am very sorry to say that in March 2008 Southeastern withdrew the application, citing land ownership issues, particularly the fact that the disused right of way belonged to J Sainsbury plc.

We understand, however—my hon. Friend touched on this in his introduction—that an agreement has been reached between Bexley council and Sainsbury’s to transfer the ownership of the land to the council and that this will be finalised shortly. This will remove Southeastern’s original reason for dropping the scheme and I am therefore disappointed that it is now citing the need to install revenue protection gates as the reason for not providing the required access.

I should add, of course, that the Government support gating as a means to protect revenue and increase security at stations, and the entrance to the London-bound platform at Crayford is already gated, but this should not be at the expense of providing access. The Department has recently commissioned research showing that providing level access to platforms can deliver increased journeys and therefore increased revenues for train operators, so I would like to encourage Southeastern seriously to look at this issue again and to give full consideration to the operational arrangements that would be required to enable access via gates to a new entrance on the other platform. Even if gates are not staffed, there are other examples, such as at Luton, of remote control of gates to entrances where passengers with tickets that cannot operate the gates place their ticket on a screen which is viewed by the operator before the gates are opened.

Small schemes funding was made available again later in 2008 for work taking place during the 2009-10 financial year. I have to report to the House that the Department received no further applications for work at Crayford. Following this debate, I will ask my officials to ensure that my comments as well as my hon. Friend’s are drawn to the attention of Southeastern’s managing director, Charles Horton.

I should make it clear that the Access for All programme is in addition to commitments made in franchises and other programmed major station improvements. It also builds on the raising of standards over recent years, including the requirement on train operating companies to take account of accessibility standards in the code of practice on train and station standards for disabled people. For example, the accessibility of booking facilities and the provision of assistance for disabled passengers have also significantly improved.

We have also recently updated the code of practice setting out the access standards for infrastructure work at stations to align it with new European standards, and these have complemented significant advances in rail vehicle accessibility over the past decade. In addition, we are working with the industry to update the way in which disabled people’s protection policies, which set out how the train operators will meet the needs of their disabled customers, are written.

There is no room for complacency, however. I do not think that anyone in this Chamber would underestimate the scale of the challenge or believe that the Railways for All strategy represents the end of our task. We recognise that progress in improving the accessibility of stations and stops must be accompanied by improvements to the accessibility of rail vehicles.

Under the Rail Vehicle Accessibility Regulations 1998—more commonly known as RVAR—introduced under the Disability Discrimination Act 1995, all new rail vehicles introduced since 31 December 1998 have had features making them significantly more accessible to disabled people, such as larger and easier access to priority seats for disabled passengers; the use of tonal contrast in liveries and finishes; a minimum number of spaces for wheelchair users; boarding devices to facilitate wheelchair access; provision of handrails and handholds; and provision of audible and visual passenger information. More than 6,200 accessible rail vehicles are already in service and all rail vehicles must be accessible by no later than 1 January 2020. Together with the code of practice, these provisions will deliver consistent access standards for vehicles and stations across the whole rail network for the first time.

My hon. Friend might say that there is not much point in making train vehicles accessible if the stations to access them are not accessible as well. That is also a point that I hope Southeastern might take on board. The 2020 “end date” dovetails with similar provisions for buses and coaches, ensuring the existence of an accessible transport chain and giving disabled people certainty that they will be able to access all public transport vehicles in future.

We should bear it in mind that, although they may not have been built to modern accessibility standards, many thousands of older rail vehicles have already been made more accessible by refurbishment. That includes fleets of older trains such as those serving my hon. Friend’s constituency, which, as he will know, have recently received accessibility improvements.

However, the need to improve access to the railway does not stop with stations and vehicles. On occasion, barriers such as a lack of confidence, poor travel information and the attitudes of staff may affect disabled people’s ability, confidence and desire to use public transport. That is why we have supported the production by the Association of Train Operating Companies of a staff disability awareness training DVD through the Access for All small schemes fund and its full access audits of every station in the country, which will allow a better focus in the targeting of future improvements.

As rail vehicles and stations are made accessible to disabled people, the facilities that they offer greatly benefit other passengers such as pregnant women, parents with pushchairs and those carrying heavy luggage. Indeed, all of us at one time or another in our lives will be grateful that those provisions have been put in place. A great deal has been achieved, but the railway industry is far from complacent, and will continue to work with the organisations representing disabled people—and, most important, with disabled people themselves—to improve services further. It is clearly regrettable that the access at Crayford station remains below modern acceptable standards, and I share my hon. Friend’s concern about that.

Services on rail are covered by the provisions of the Disability Discrimination Act 1995, which is soon to be replaced by the Equality Act 2010. It is the duty of Southeastern to make reasonable adjustments to the way it provides its services so that disabled customers do not find them impossible or unreasonably difficult to use. It might make physical adjustments, or it might make the service available by an alternative means such as the provision of an accessible taxi to the next level access station; but that is a much less satisfactory—

23:12

House adjourned without Question put (Standing Order No. 9(7)).