House of Commons

Tuesday 26th October 2010 Commons Chamber

Tuesday 26 October 2010

The House met at half-past Two o’clock

Prayers

Tuesday 26th October 2010 Commons Chamber

[Mr Speaker in the Chair]

Oral Answers to Questions

Tuesday 26th October 2010 Commons Chamber

The Deputy Prime Minister was asked—

[Gareth Johnson (Dartford) (Con)]

1. What recent representations he has received on his proposals to create fewer and more equally sized constituencies.

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

5. What recent representations he has received on his proposals to create fewer and more equally sized constituencies.

[The Deputy Prime Minister (Mr Nick Clegg)]

A range of views have been expressed to me, in correspondence and discussion, on the Government’s proposals to create fewer and more equally sized constituencies. In addition, the Parliamentary Voting System and Constituencies Bill had five days of debate on the Floor of the House for its Committee stage.

[Gareth Johnson]

Does the Deputy Prime Minister agree that it is vital to have constituencies in which all votes carry equal weight, in order to restore public trust in our democratic process?

[The Deputy Prime Minister]

I strongly agree with my hon. Friend. It is one of the founding principles of any democracy that votes should be valued in the same way, wherever they are cast. Over the years, all sorts of anomalies have developed, such that different people’s votes are simply not worth the same in elections to this place. That surely cannot be right, and it is worth reminding those Opposition Members who object to the rationale that it was one of the founding tenets of the Chartists—one of the predecessor movements to the Labour party—that all votes should be of equal value.

[Andrew Bridgen]

Does the Deputy Prime Minister agree that, for Members of this place to have an effective relationship with local authorities, it is important that emphasis should be placed on keeping parliamentary constituencies as coterminous as possible after the boundary review?

[The Deputy Prime Minister]

I certainly agree that, where possible, if not in all cases, the building blocks for the boundary review should follow ward boundaries. It would be foolish to reinvent the wheel in that respect. That is why we are proceeding on the basis that ward boundaries will indeed continue to serve as the building blocks for the boundary reviews.

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

In order to force through the gerrymandering of Parliament before the next general election, which the Deputy Prime Minister is trying to do, will he be able to get those 50 friends from among his Tory and Liberal colleagues packed into the House of Lords by next week or the week after? When is he planning to make that announcement?

[The Deputy Prime Minister]

As the hon. Gentleman knows, we will be publishing a Bill early in the new year, which we are drafting at the moment on a cross-party basis, to reform the other place. In the meantime, in keeping with traditions that were also pursued by his Government, appointments will be made as a proportion of and in line with the results of the general election.

[Chris Bryant (Rhondda) (Lab)]

It is estimated that 200,000 people will be forced out of major metropolitan areas as a result of the Government’s niggardly proposals on welfare reform, which will turn London into Paris, with the poor consigned to the outer ring. That is the equivalent of three parliamentary constituencies, according to the Deputy Prime Minister’s desiccated calculating machine of a Bill. Would it not be iniquitous if, on top of being socially engineered and sociologically cleansed out of London, the poor were also disfranchised by his Bill? How does he propose to make electoral provision for those displaced people?

[The Deputy Prime Minister]

We all indulge in a bit of hyperbole, but I have to say to the hon. Gentleman quite seriously that to refer to “cleansing” will be deeply offensive to people who have witnessed ethnic cleansing in other parts of the world. It is an outrageous way of describing—

[Chris Bryant]

That is what you are doing.

[The Deputy Prime Minister]

No, I will tell him exactly what we are doing—

[Chris Bryant]

That is what you are doing.

[The Deputy Prime Minister]

No. We are saying that it is perfectly reasonable for the Government to say that they will not hand out more in housing benefit than those who go out to work, pay their taxes and play by the rules would pay when looking for housing themselves. We are simply suggesting that there should be a cap for family homes with four bedrooms of £400 a week. That is £21,000 a year. Does the hon. Gentleman really think it is wrong that the state should not subsidise people to the tune of more than £21,000, when people cannot afford to live privately in those areas? I do not think so.

[Henry Smith (Crawley) (Con)]

2. What progress he has made on developing proposals for a wholly or mainly elected second Chamber.

[The Parliamentary Secretary, Cabinet Office (Mr Mark Harper)]

My right hon. Friend the Deputy Prime Minister announced to this House in June that he would chair a cross-party Committee that would set out the Government’s proposals which they will bring forward in a draft Bill early next year. We hope that a Joint Committee of both Houses will be able to scrutinise it in due course.

[Henry Smith]

I am grateful to my hon. Friend for that answer. Does he agree that only those elected to a revised second Chamber should be able to vote on the passage of legislation?

[Mr Harper]

I very much agree with my hon. Friend. The Government have made it very clear that we think those who make our laws should be elected. Thinking back to the previous question, it is worth saying that of the peers created since this Government came to office, more of them are Labour than represent the coalition parties.

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

Will the Minister explain why he is proceeding with a cross-party, consensual approach to reforming the House of Lords, as is right and proper, yet rushing through other major changes to parliamentary democracy and the way in which we run this country without such usual cross-party consensus and support?

[Mr Harper]

I certainly do not agree with the right hon. Gentleman that we are rushing things through. We have had five days of debate on the Floor of the House and we have another two days on Report next week. Labour Members—albeit not the right hon. Gentleman—voted against our programme motion, which gave the House more time. I simply do not agree with him on this. We have set out our proposals and we hope that this House and the other place will agree with them in due course.

[Duncan Hames (Chippenham) (LD)]

The country has been waiting 100 years to elect the Lords. Once the Minister’s plans become law, how long will it take to achieve the Government’s intended proportion of elected Members in the upper Chamber?

[Mr Harper]

My hon. Friend puts his finger on an issue that the cross-party Committee is taking seriously and on which I am sure the Joint Committee will have a view: the length of, and procedure for, the transitional period. It is not an easy process. I look forward to the debate once we have published our draft Bill.

[Sadiq Khan (Tooting) (Lab)]

We support the Minister’s plans to make constitutional and political reform the Government’s centrepiece, as long as it is for the right reasons and is effective. Will he confirm that, at the same time as rushing through legislation to remove 50 elected Members from this House—all the evidence suggests that most of them will be Labour MPs—this Government are rushing through plans to appoint 50 more unelected peers to the other place, most of whom will be Conservative and Liberal Democrat? Can the hon. Gentleman understand why most observers think that this is partisan and political manoeuvring?

[Mr Harper]

I welcome the right hon. Gentleman to his position, as this is the first time that we have crossed swords at the Dispatch Box at Deputy Prime Minister’s questions.

On House of Lords reform, as I said in my previous answer, the Government will create some new peers in due course—the Prime Minister has made that clear—in the same way that the previous Government did. Since the election, 29 Labour peers have been created, in the resignation honours list of the right hon. Member for Kirkcaldy and Cowdenbeath (Mr Brown), but only 27 coalition peers. The Government have no plans to pack the upper House; the Government do not have a majority in the other place; we will take our legislation through there by arguing the merits of the case and hoping to persuade a majority.

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

Given that most people would react with horror at the prospect of doubling the number of elected MPs, why does my hon. Friend think so many on both sides of the House are fanatically in favour of turning the upper House into a carbon copy of this Chamber, which might either rubber-stamp or oppose its findings, while excluding the experts who do such a good job in revising our legislation?

[Mr Harper]

I know my hon. Friend’s views on this subject, but he is simply not right. One issue that the cross-party Committee is thinking about very carefully is exactly how to ensure that the reformed second Chamber is not a carbon copy of this place—that would clearly not be sensible. Although we think that Members should be elected, we will look at a range of ways of ensuring that the House of Lords can do its job properly as a revising Chamber, without duplicating the role of this House, which will remain the primary House of Parliament.

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

3. If he will bring forward proposals to lower to 16 years the voting age in elections and referendums.

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

6. What the Government's policy is on extending the electoral franchise to 16 and 17-year-olds.

[The Deputy Prime Minister]

The Government have no current plans to lower the voting age to 16, but we will of course keep the issue under review.

[Natascha Engel]

My question was one of definition. In what way is a vote at 16 in a referendum different from a vote at 16 in a general election? If there is no difference, why did the Liberal Democrats, who support votes at 16, whip and vote against lowering the voting age in the referendum on parliamentary voting reform?

[The Deputy Prime Minister]

You are right that there are different views in this Government, as there were—

[Mr Speaker]

Order. May I say to the Deputy Prime Minister that I am not claiming to be right?

[The Deputy Prime Minister]

The hon. Lady is right that there are differences of view in this Government, as there were in the previous Government, about the merits or not of moving to votes at 16. On the issue of whether such a move should apply only to the referendum and not to other votes, the feeling, not unreasonably, was that the matter needs to be looked at in the round. If we are to take a decision in this House, it should be taken on the principle, across all elections and votes, and not just the referendum.

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

A recent Demos report established that, in the past decade, 16 and 17-year-olds contributed £500 million in tax to the UK Exchequer, that 4,500 of them serve in the British armed forces, and that they are now capable of being company directors. Given that, what possible reason is there for excluding them from voting in referendums or elections?

[The Deputy Prime Minister]

I happen to be a supporter of votes at 16 but we are open about the fact that there are differences of view in this Government. That is why the matter is not included in our coalition agreement. The previous Labour Government also had no consensus on the matter, and I assume that that is why the hon. Gentleman’s party never brought such a proposal forward when it was in government.

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

Given that in the past three general elections it is likely that less than a third of 18 to 25-year-olds bothered to turn out to vote, and given that more of that age group vote for contestants in “The X Factor” than for candidates in general elections or likely referendums, will the Government turn their face against the ridiculous proposal to reduce the voting age to 16, until such time as slightly older people have shown a greater commitment to British democracy?

[The Deputy Prime Minister]

Whether people are entitled to vote should not in principle depend on whether they exercise that right. One can accept the principle that people should be entitled to vote at certain ages, without making that entitlement contingent on their exercising it.

[Philip Davies (Shipley) (Con)]

Does the Deputy Prime Minister agree that there is something slightly irrational about those who, in the previous Parliament, thought that we should increase the age at which people are allowed to smoke from 16 to 18, but who now think that 16-year-olds have the right level of responsibility for the voting age to be reduced from 18 to 16?

[The Deputy Prime Minister]

I certainly agree—[Interruption.]

[Mr Speaker]

Order. I want to hear the answers from the Deputy Prime Minister.

[The Deputy Prime Minister]

I was not going to turn to the sensitive issue, at least in my household, of smoking. However, I agree with the hon. Gentleman that on this issue, as on so many others, the Labour party seems wholly inconsistent. It was silent—[Interruption.] They were silent on votes at 16 when in government, and now they are arch campaigners for a change that they never delivered when they had the chance to do so. [Interruption.]

[Mr Speaker]

Order. Opposition Back Benchers must calm down. I am very worried about you, Mr Gwynne. You just calm down. You have a fit of the giggles, but you will overcome it, do not worry.

[Andrew Stephenson (Pendle) (Con)]

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

[The Deputy Prime Minister]

As Deputy Prime Minister, I support the Prime Minister on the full range of Government policy and initiatives, and within Government I take direct responsibility for this Government’s programme of political and constitutional reform.

[Andrew Stephenson]

Although I welcome the coalition’s commitment to introduce individual voter registration, many Members across the House remain concerned about on-demand postal and proxy votes, which we still feel are too open to abuse. Will my right hon. Friend undertake to look at the possibility of reintroducing restrictions to those entitled to register for postal votes?

[The Deputy Prime Minister]

I certainly agree with my hon. Friend that any incidence of fraud in our elections, particularly postal vote fraud—there seems, at least, unacceptable evidence that that has been happening around the country—needs to be dealt with. How we do that is quite complex, and the kind of controls we put in place are still under consideration. We will consider our options and take measures forward as soon as we can.

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

As Deputy Prime Minister, the right hon. Gentleman takes and shares ministerial responsibility for the Government’s spending decisions. Will he confirm that as a result of those spending decisions as many as 500,000 jobs will go in the private sector, in addition to the 490,000 that will be lost in the public sector?

[The Deputy Prime Minister]

I will confirm that all the statistics on possible job losses are derived from the independent Office for Budget Responsibility, which has said that at the end of the spending round there may be 490,000 fewer posts in the public sector. That is still 200,000 more than the number of people who were employed in the sector when the right hon. Member for Kirkcaldy and Cowdenbeath (Mr Brown) and Tony Blair took power in 1997. Separately, the Office for Budget Responsibility has predicted that more than 2 million jobs will be created in the private sector.

[Ms Harman]

Surely the Deputy Prime Minister must recognise that, even before the cuts resulting from his spending decisions bite, it is hard for unemployed people when five of them are chasing every job vacancy. Why, then, are his Government planning to punish unemployed people who have been searching for a job for more than a year by cutting their housing benefit by 10%? That is a deeply unfair policy. Will the Deputy Prime Minister review it?

[The Deputy Prime Minister]

What we will seek to do in the coming months and years is increase the incentives to work. That is the centrepiece of our Government policies. That is why we have raised the income tax personal allowance, exempting nearly 900,000 people on low pay from income tax; that is why, over time, we will introduce a universal credit; and that is why we will implement the reform of our welfare system which, although much talked about in previous years, has never been put into practice.

[Jeremy Lefroy (Stafford) (Con)]

T3. As chairman of the all-party parliamentary group on malaria and neglected tropical diseases, I welcome my right hon. Friend’s announcement during his recent visit to the United Nations that United Kingdom funds for malaria would increase to £500 million a year by 2014. Given that the Government rightly concentrate on outcomes rather than inputs, what outcomes does my right hon. Friend expect to result from the more than tripling of malaria funds by that date?

[The Deputy Prime Minister]

Like the hon. Gentleman, I think that it is witness to this country’s commitment to the poor in other parts of the world that, even in difficult times when we are having to make difficult savings elsewhere in public spending, we are honouring our commitment to the developing world to allocate 0.7% of national wealth to development aid from 2013.

The specific answer to the hon. Gentleman’s question is that the increase in spending to £500 million per year by 2014 will reduce the number of malaria deaths by at least 50% by 2015 in at least 10 high-burden countries.

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

T2. Will the Deputy Prime Minister now answer the question asked by my right hon. and learned Friend the Member for Camberwell and Peckham (Ms Harman)? He is about to cut the housing benefits of some of the poorest households in Britain by 10%. Why will he not reconsider, given that we are experiencing some of the most trying economic circumstances of the past 30 years?

[The Deputy Prime Minister]

As I said earlier, what we are trying to do in respect of housing, as in respect of all other areas of public spending in the welfare system, is increase the incentives to work. Something has gone seriously wrong with a housing benefit system that has more than doubled in recent years, from £10 billion to £21 billion, and has locked many people into long-term dependency. It has not created incentives to work, or incentives for house builders to build more affordable homes. We plan to increase capital investment in house building, reform housing benefit, and build up to 400,000 affordable homes over the coming decade.

[Stephen Mosley (City of Chester) (Con)]

T5. Given that several major public sector trade unions are threatening public action over some of the announcements in last week’s comprehensive spending review, and given continued attempts by unions to block some of the reforms that the coalition Government are trying to introduce, does my right hon. Friend agree that it is time to reduce the trade unions’ irresponsible influence on British party politics, and to draw up proposals to reform trade union funding of political parties?

[The Deputy Prime Minister]

I imagine that the hon. Gentleman’s views would be particularly unpopular with the new leader of the Labour party, who secured his position only because of the block and duplicate votes of trade union members.

I hope that, in the coming weeks and months, we will not pitch the country into confrontation between the Government and the trade unions. I believe that—this, incidentally, has applied to local authorities up and down the country under the control of different political parties—there is a means by which we can work co-operatively with trade unions to make the savings that we need to make as a nation, and reduce to the bare minimum the number of job losses that might be incurred in the process.

[Ian Mearns (Gateshead) (Lab)]

T4. The Deputy Prime Minister need not be concerned that I am going to ask him for a meeting at the end of this question, as I am still waiting for a meeting that he agreed to hold with me during an answer at Prime Minister’s questions on 21 July—and, frankly, I am not holding my breath.In my constituency of Gateshead one of the greatest factors in continuing health inequalities and shorter life expectancy among some of the poorest communities is the prevalence of smoking. Does the Deputy Prime Minister at all regret promoting smoking by saying it would be his greatest single luxury if he were stranded on a desert island?

[The Deputy Prime Minister]

First, let me apologise if the hon. Gentleman had been waiting for a meeting; I am keen to ensure that one is fixed as soon as possible.

I was not in any way seeking to promote smoking. It is a very bad habit, and I would never advocate it to anybody else.

[Harriett Baldwin (West Worcestershire) (Con)]

T8. The coalition programme for government calls for a commission to be established to look into the West Lothian question. Please will the Deputy Prime Minister update the House on the establishment of that commission?

[The Deputy Prime Minister]

My hon. Friend the Parliamentary Secretary, Cabinet Office, who has responsibility for constitutional affairs, will lead on that and he will announce our intention to set up a commission on the long-standing knotty problem of the West Lothian question by the end of the year.

[Mrs Linda Riordan (Halifax) (Lab/Co-op)]

T6. What support are local authorities such as Calderdale in my constituency being given to ensure that as many people as possible are on the electoral register?

[The Deputy Prime Minister]

The principal innovation we are seeking to introduce is to allow electoral registration officers to compare their databases of who is and is not on the register with other publicly available databases. We are piloting that in a number of areas, and we hope it will enable officers to see who is not on the electoral register but is on other databases so that they can then, possibly literally, go and knock on their door and say, “You’re on one database but not the other; have you thought of getting on to the electoral register?” I know there has been a lot of polemic around this issue, but I hope we will be able to work on a cross-party basis. Many Members will know from their own areas of the best innovations in getting people on to the register. I am actively looking at ways in which we can create a cross-party forum where we can compare best practice to get more and still more people on to the register.

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

T9. Does my right hon. Friend agree that having an open and frank discussion about the British voting system as part of the alternative vote referendum is an excellent way to help re-establish faith and trust in British politics?

[The Deputy Prime Minister]

I certainly hope so. It will be the first nationwide referendum we have had since the early 1970s, and we should be open about the fact that, including in this Government, we do not agree on the best outcome. However, we all agree that it should be for the people to choose. That is why I urge those Members who are dragging their feet somewhat in allowing the proposed legislation to pass its various stages in this House and the other place to realise that we should try not only to subject it to the necessary scrutiny, but above all allow the people outside this House to have their say and so help restore some public trust in what we do.

[John Robertson (Glasgow North West) (Lab)]

T7. We have heard what the right hon. Gentleman has to say about the local housing allowance and how it affects people, but what has he got to say to the 49,000 people who will be made homeless thanks to what he is about to do? Will he say sorry?

[The Deputy Prime Minister]

By allowing rents for new tenants, but not existing tenants, to be set closer to market rates—and by the way, rents for existing—[Interruption.] Rents for existing tenants went up by about 15% under the Labour Government. We are saying that we need to give registered social landlords an incentive to build new affordable homes—the building of which was at lamentably low levels under the previous Government—while all the time, of course, compensating those tenants through the housing benefit system. As I said earlier, we also think it is right for the Government to say that there needs to be some kind of limit for those people who are on housing benefit, and it seems fair for that limit to be set roughly at the level at which people who are going out to work would be looking for rented property in the private sector.

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

T10. The Deputy Prime Minister will be aware of Labour’s catastrophic defeat in Tower Hamlets last week at the hands of the Ken Livingstone-backed independent candidate, but will he examine the issue of electoral fraud, because serious allegations of it were made at the local elections in May and again last week? Some 18 postal votes came from one four-bedroom house and eight postal votes came from a maisonette above a shop, and more than 5,000 new names were added to the roll just before the deadline. Will—

[Mr Speaker]

Order. I say to the hon. Gentleman that that is quite enough and we need an answer.

[The Deputy Prime Minister]

Where there are incidents and allegations of serious electoral fraud they need to be reported to the police. These are very serious matters; these are potentially criminal offences, and they need to be investigated by the police. So if there is evidence, it needs to be passed to the police as soon as possible.

[Anas Sarwar (Glasgow Central) (Lab)]

During the election campaign, the Deputy Prime Minister said:

“We will resist, vote against, campaign against, any lifting of that cap”

on tuition fees. Will he take this opportunity to apologise to the hundreds of thousands of students and families whom he has betrayed since becoming a Tory?

[The Deputy Prime Minister]

Of course I regret—who would not regret?—making a promise and signing a pledge, as happened in this case, that we have now found that we are unable to keep. Of course I wish that the proposal for a graduate tax put forward now by the hon. Gentleman’s leader, which comes from a party that introduced tuition fees having previously said that it would not do so, would work and that it was an alternative that we could implement. We looked at it very carefully—it has also been proposed by the National Union of Students—but it is not workable and it is not fair. What we will be doing shortly, when we come forward with our response to the Browne report, is install new measures that will ensure that the way in which students go to university is fairer and less punitive on those who are disadvantaged than the system that we inherited from the Labour party.

[Jo Swinson (East Dunbartonshire) (LD)]

An important part of political reform is changing the way we do politics—for example, to make it more accessible to under-represented groups such as parents of young children. It is surely ridiculous that in this House one can take a sword into the Lobby but not a newborn child. Will the Deputy Prime Minister ensure that the recommendations on that and other issues in the Speaker’s Conference report are acted on, and acted on swiftly?

[The Deputy Prime Minister]

I certainly agree that we should be acting on the—broadly speaking—excellent recommendations from the Speaker’s Conference. As for my hon. Friend’s proposal of allowing babies and young children into the Chamber or the Lobby, I cannot readily see a Government position or an amendment to the coalition agreement on that; it will be a matter for the House. However, I certainly agree—I say this with some feeling, as a father of three young children—that it is very difficult for mothers and fathers to combine having young children with life in politics, not least because of the idiosyncratic way in which we organise ourselves in this House. We need to provide all the support we can to allow parents to be good parents, but good MPs as well.

The Attorney-General was asked—

[Grahame M. Morris (Easington) (Lab)]

1. What his policy is on prosecution of victims of human trafficking who are suspected of having committed a criminal offence.

[The Attorney-General (Mr Dominic Grieve)]

The policy of the Crown Prosecution Service is to consider the extent to which the suspects who might be victims of trafficking were compelled to undertake the unlawful activity alleged. That is compatible with our common law defence of duress. Where there is clear evidence of duress, the case should be discontinued on evidential grounds. Where it is not clear whether the suspect was acting under duress, consideration will be given to whether the suspect was in a coerced situation. In such circumstances, there will be a strong public interest to stop the prosecution.

[Grahame M. Morris]

Will the Attorney-General explain the coalition Government’s strategy to contain the growing criminal and completely abhorrent practice of human trafficking, particularly with regard to the trafficking of prostitutes and press reports that human traffickers aim to exploit opportunities presented by the 2012 Olympic games and the large number of people coming to London for them?

[The Attorney-General]

The Crown Prosecution Service works closely with the police and other related organisations to try to improve its ability to prosecute human trafficking cases. It has, for example, only very recently sent a senior prosecutor to Vietnam to discuss the issue of child trafficking into this country from that country. In addition, we are adherent to the EU directive on trafficking, which we ratified and implemented. It provided that all member states should, in accordance with the basic principles of its legal system, provide for the possibility, as I have just said, of not imposing penalties on victims for their involvement in unlawful activities. One of the reasons for that is to facilitate their coming forward so that a prosecution of the traffickers can take place.

[Mr Peter Bone (Wellingborough) (Con)]

How does the Attorney-General square that statement with the fact that the Court of Appeal recently released three young women from prison who had been trafficked into this country and forced into prostitution but were prosecuted by the CPS against the advice of the police and the POPPY project?

[The Attorney-General]

It is difficult for me to comment on an individual case, although if my hon. Friend wishes to draw the particular circumstances to my attention I am more than happy to write to him about it. As I said a moment ago, the policy of the CPS and the principles it follows under the code of Crown prosecutors put the public interest at the forefront of a prosecution. Where the public interest is thought not to require a prosecution, no prosecution will be brought.

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

2. When he next plans to review the Crown Prosecution Service’s violence against women strategy.

[The Solicitor-General (Mr Edward Garnier)]

The Crown Prosecution Service’s violence against women strategy was published in June 2008. The assessment of the benefits of the strategy on prosecutions for violence against women will be published in the autumn of 2011. Annual reports are also published.

[Roberta Blackman-Woods]

I thank the Solicitor-General for that response. I am sure that he will be aware that Durham CPS piloted the use of specialist services such as domestic violence courts and multi-agency risk assessment conferences to determine appropriate interventions in domestic violence cases. What reassurance can he give the House that those specialist services that have been so successful will continue?

[The Solicitor-General]

May I thank the hon. Lady for visiting her CPS office on 1 October? Her visit was most welcome and I hope that other Members of Parliament will take the same opportunity to visit their local CPS. I can give her the assurance that she seeks. The CPS, my right hon. and learned Friend the Attorney-General and I take the aspect of the criminal law that she has just addressed extremely seriously and we will ensure that both the CPS and the wider criminal justice system bear down on reducing the number of offences against women.

[Rehman Chishti (Gillingham and Rainham) (Con)]

According to CPS data, between 2008 and 2009 12% of cases were unsuccessful in the category “violence against women” due to victim-related issues. What are we doing to address that?

[The Solicitor-General]

To be fair to the previous Government, they introduced the slogan and policy of “no witness, no justice”. One of the most important things that we can do is to ensure that victims of domestic violence are encouraged, protected, persuaded and assisted in taking their evidence to court so that the criminal justice system can deal with those who mete out violence towards them. There is no excuse for violent people attacking others and there is particularly no excuse for the criminal justice system to ignore women within the domestic scene who are beaten up by others.

[Catherine McKinnell (Newcastle upon Tyne North) (Lab)]

As the shadow Solicitor-General, I look forward to working with the Law Officers, particularly in supporting the CPS in its hugely important role of ensuring an independent operation, in advising the police and in ensuring that perpetrators of crime are brought to justice. However, in light of the comments made by the Director of Public Prosecutions over the weekend to the effect that budget cuts to the CPS

“pose the biggest challenge in its history”

and earlier comments from the president of the Law Society:

“The ultimate losers from these plans for the CPS to slash its budget are the vulnerable clients in need of help dealing with housing, mental health and domestic violence”,

what steps will the Law Officers take to ensure that the CPS has sufficient resources to continue to secure prosecutions for domestic violence and to ensure that cuts are not just a risky gamble with delivering justice for vulnerable groups?

[The Solicitor-General]

I congratulate the hon. Lady on her appointment as shadow Solicitor-General. There are many people who think that the Law Officers themselves are pretty shadowy, but I—

[Chris Bryant (Rhondda) (Lab)]

Shabby or shadowy?

[The Solicitor-General]

I would never accuse the hon. Gentleman of being shabby. His dress code is always immaculate.

[Chris Bryant]

You have lost your train of thought now.

[The Solicitor-General]

I think that the train of my thought is concentrating on the shadow Solicitor-General.

[Mr Speaker]

Order. The train of my thought is that I would like to make some progress down the Order Paper because other Members are waiting to ask questions. We will hear the Solicitor-General’s answer pronto.

[The Solicitor-General]

I assure the hon. Member for Newcastle upon Tyne North (Catherine McKinnell) that the Government and the Law Officers’ Department are extremely concerned to ensure that the issues about which she has just addressed the House are properly catered for within the criminal justice system and by the Law Officers.

[Alun Michael (Cardiff South and Penarth) (Lab/Co-op)]

3. What assessment he has made of the progress of the National Fraud Strategic Authority in reducing the level of fraud and online crime.

[The Attorney-General]

By working in partnership across the public and private sectors, the National Fraud Strategic Authority has contributed towards improving our understanding of the scale and nature of the fraud challenge, as well as making a significant contribution to improving our response to that challenge. It has produced the most comprehensive estimate yet of the annual cost of fraud to the United Kingdom at £30.5 billion, a significant part of which is against the public sector. It has launched Action Fraud, the national fraud reporting centre, which has provided advice and guidance to more than 100,000 people since April, many of whom have been victims of online crime. As part of the comprehensive spending review, the Government have provided ring-fenced funding for the NFSA to continue its work.

[Alun Michael]

I am grateful to the Attorney-General for that encouraging reply. Within the figures that he has mentioned, internet-related fraud ranges from very large institutional losses to large numbers of low-level attacks. Does he agree that it is important to keep up the pressure on both those fronts, so that ordinary people can be confident about being safe online?

[The Attorney-General]

I entirely agree with the right hon. Gentleman. I know that he chairs the e-crime reduction partnership, which was itself established by EURIM, and I welcome the fact that he has taken an interest in the subject. I assure him that the NFA will welcome his input and that of others on how it should take its work, which we value, forward. As I have mentioned, it has identified a global figure for the level of fraud, but it has also broken it down. Public sector fraud, for example, is estimated at some £17 billion, while identity fraud is estimated at some £2.7 billion.

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

If Google and Hotmail are deemed to be less secure, what recommendation can the Government make to advise ordinary people who use those accounts to make them more secure and more aware of the potential for fraud?

[The Attorney-General]

First, the NFSA can supply information on how people can protect themselves against fraud, and it regularly does so. Secondly, as my hon. Friend will know, the Government have announced an extra £650 million for cyber-security, which will be used to look at how hacking, getting into people’s internet accounts and acquiring people’s identities can be properly countered.

[Gareth Johnson (Dartford) (Con)]

4. What representations he has received on his recent report on unduly lenient sentences; and if he will make a statement.

[Andrew Bingham (High Peak) (Con)]

5. What representations he has received on his recent report on unduly lenient sentences; and if he will make a statement.

[The Solicitor-General]

In July this year, my right hon. and learned Friend the Attorney-General and I released information on unduly lenient sentences in cases for 2009, the latest year for which figures are available. The figures show that of 311 sentences considered by the Law Officers, 108 were referred and heard by the Court of Appeal, of which 71 sentences were increased by the Court. The decision whether to refer cases often generates a good deal of media or public interest, but no representations were received by the Attorney-General’s office as a direct consequence of the publication of that information.

[Gareth Johnson]

Does my hon. and learned Friend agree that nothing undermines victims of crime more than unduly lenient sentences? Unfortunately, not all unduly lenient sentences can be appealed against. Will he therefore consider increasing the number of offences where such sentences can be appealed against?

[The Solicitor-General]

As my hon. Friend realises, the statutory scheme comes under the Criminal Justice Act 1988, which provides us with the rubric that we must follow. We are limited by that statute, but if he thinks that particular crimes or sentences need to be looked at so that that law can be adjusted, I advise him to write to the Ministry of Justice.

[Andrew Bingham]

The unduly lenient sentences scheme covers some but not all offences. In helping me to explain the situation to my constituents in High Peak, will my hon. and learned Friend explain why the scheme is limited to certain offences?

[The Solicitor-General]

The short answer is because that is what the statute says. It is confusing that there is a limitation on sentences that we can ask the Court of Appeal to consider. Cases that are triable on indictment only and cases that are triable either way are listed in the Statutory Instrument that followed the main statute. I am happy to have a discussion later with my hon. Friend to see whether we can help his constituents understand that rather complicated area of law.

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

The details that emerged during the recent trial of Bolton, Griffin and Marshall in Manchester were truly appalling, but their case could not be referred to the Court of Appeal because they were convicted only of lesser offences. May I encourage the Solicitor-General and the Attorney-General to consider carefully the merits of extending the list of eligible offences to include a wider range of violent offences?

[The Solicitor-General]

My right hon. and learned Friend and I are always happy to consider suggestions of that nature, but the legislation would have to be amended by the Secretary of State for Justice and his team. Another point to bear in mind is that members of the public often contact us outside the 28-day limit and we cannot consider sentences, even if they are, in theory, reparable, if they are brought to our attention after 28 days.

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

Is the Solicitor-General concerned about the plans of the Ministry of Justice to reduce prison numbers and does he think it will result in more claims regarding unduly lenient sentences being presented to his Department?

[The Solicitor-General]

Not necessarily.

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

6. What discussions he has had with the Crown Prosecution Service on steps to increase the proportion of prosecutions for offences of human trafficking which result in conviction.

[The Attorney-General]

I have had no recent discussions with the CPS regarding the effectiveness of prosecution policy in human trafficking cases, but the CPS has comprehensive guidance for prosecutors to ensure that decisions in human trafficking cases are taken in line with the principles in the code for Crown prosecutors, taking account of the particular factors that are relevant in such cases. However, if my hon. Friend has specific concerns, I invite him to write to me. I have regular meetings with the DPP during which we discuss a range of issues and this topic can and will be included when necessary.

[Andrew Selous]

Will my right hon. and learned Friend get together the CPS, the police and the judiciary to see what we can do to increase the lamentably low number of convictions that we are currently securing for human trafficking?

[The Attorney-General]

I certainly share my hon. Friend’s desire to see the number of prosecutions increase. Of course, the CPS is ultimately a referral organisation—it takes the cases that are offered to it. There is some comfort in the latest figures: there is an indication that in the first six months of this year since April there were 17 prosecutions for trafficking under the Asylum and Immigration (Treatment of Claimants, etc.) Act 2004, compared with only 19 in the previous 12-month period, and similar figures can be found for prosecutions under the Sexual Offences Act 2003. However, I will bear the matter in mind. There is already a lot of close working between the CPS, the Association of Chief Police Officers and the Gangmasters Licensing Authority. Of course, these matters are also discussed when necessary with the judiciary.

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

Does the Attorney-General recognise that in cases in which victims of trafficking are afforded better protection, such as safe accommodation, they are more willing to come to court as witnesses? If he recognises that, will he work with his colleagues across Government to make sure that victims of trafficking are encouraged to come forward as witnesses and therefore increase the prosecution rate?

[The Attorney-General]

As I hope I indicated in my answer to the first question, those are precisely the sort of criteria put forward to encourage people to come forward without fearing that they will suffer consequences in doing so. For those reasons, I assure the hon. Lady that this is a priority issue. As human trafficking is regarded as a very serious offence, every effort will be made to encourage victims to come forward.

The hon. Member for Banbury, representing the Church Commissioners, was asked—

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

1. What recent representations the Church Commissioners have received on the criteria for the appointment of bishops in the Church of England; and if he will make a statement.

[The Second Church Estates Commissioner (Tony Baldry)]

The canons require that anyone to be considered and consecrated as a bishop at present has to be male and over 30.

[Natascha Engel]

I thank the hon. Gentleman for that answer. The Archbishop of Canterbury has recently written a newspaper article saying that it is okay to be a gay bishop as long as one is celibate. Where does the Church of England stand on people in civil partnerships? If they are celibate, are they okay to be bishops too?

[Tony Baldry]

There is no Church of England rule that prevents a celibate person in a civil partnership from being considered for appointment as a bishop. The issue is whether someone in that position could act as a focus for unity in a diocese. That would have to be considered by those responsible for making any episcopal appointment.

[Richard Graham (Gloucester) (Con)]

2. What recent discussions the Church Commissioners have had with the Chancellor of the Exchequer on the effects on church incomes of the gift aid scheme.

[Tony Baldry]

The Churches, and I suspect all charities, are extremely grateful for gift aid. However, the administrative complexity, and particularly the need to keep paper gift aid declarations on file, causes great difficulty.

[Richard Graham]

I thank my hon. Friend for that reply. Churchgoers all over my constituency of Gloucester, both of the Church of England, which spends more than £1 billion a year maintaining a community presence across the city and all over our country, and of other Churches would welcome the introduction of a gift aid “light” scheme, meaning light in administrative burden for smaller charities. Does my hon. Friend agree that it would be a good idea, and would Her Majesty’s Treasury support it?

[Tony Baldry]

My hon. Friend makes an extremely good point. The plans being developed in Gloucester are extremely good ideas and we should like to encourage Her Majesty’s Revenue and Customs to move to a more streamlined system with an option for an online filing and accounting system. That would save time and money, not just for the Churches and charities but for HMRC.

[Mr David Ruffley (Bury St Edmunds) (Con)]

Last year, gift aid that went to St Edmundsbury cathedral was 25% lower than the aid it received from the listed places of worship grant scheme. I am delighted that the Government have extended that scheme from March 2011, but could my hon. Friend tell me what steps will be taken to publicise that scheme much more widely, so that more of our English church heritage can be preserved?

[Tony Baldry]

It is extremely good news that Ministers in the Department for Culture, Media and Sport have extended the scheme; that is very welcome. I think the hundreds of thousands of volunteers who raise money for the repair and refurbishment of churches up and down the country are very conscious of the VAT scheme on listed buildings and churches. My hon. Friend can rest assured that every diocese will be making sure that it is publicised in every parish.

[Jim Shannon (Strangford) (DUP)]

The hon. Gentleman has acknowledged the importance of the gift aid scheme. Last week the Exchequer Secretary to the Treasury, in a reply to a question in this Chamber, indicated that some £4.5 million comes off the gift aid scheme. What discussions has the hon. Gentleman had with the Churches to ensure that the gift aid scheme can be increased, to ensure that they can then use that money for the work that they do?

[Tony Baldry]

The difficulty with the gift aid scheme at the present moment is that churches and parishes have to maintain enormous numbers of paper records, just in case there is any spot check from HMRC. It involves thousands of volunteer hours just to do so, and it would be perfectly possible to do it as effectively online, much more simply. That would be in everyone’s interests, not least those of HMRC. The Church and, I am sure, other charities will continue to pursue that with ministerial colleagues in the Treasury and with the Treasury itself.

[Fiona Bruce (Congleton) (Con)]

3. What account the Church Commissioners take of ethical criteria when making investments.

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

7. What account the Church Commissioners take of ethical criteria when making investments.

[Tony Baldry]

The Church Commissioners are committed to managing our assets in a way that reflects the Church’s teaching and values and take advice on ethical investment policies from the Church’s ethical investment advisory group.

[Fiona Bruce]

How do the Church Commissioners use their substantial wealth to encourage responsible corporate practice?

[Tony Baldry]

My hon. Friend is right to raise this issue. The Church Commissioners seek positively to encourage responsible corporate practice by the businesses in which we invest. We are signatories to the United Nations principles for responsible investment. We vote our shares in line with the importance we attach to good corporate governance. We continuously discuss environmental, social and governance issues with our investment managers, and if ever we should have a concern about corporate practice in a company in which we invest, we engage with that company to seek to influence its corporate behaviour at board level.

[Mr Jim Cunningham]

What is the Church Commissioners’ attitude to arms deals, particularly the shady arms trade? What would be the commissioners’ attitude to that in terms of investment?

[Tony Baldry]

I can assure the hon. Gentleman that we would not invest in companies that we thought were shady. For example, we disinvested from Vedanta Resources plc recently because of its treatment of tribal communities in India. There are a number of US companies that we have made a conscious decision not to invest in because of their involvement in cluster munitions systems. Wherever possible, if we think that someone is behaving in a shady way, we would hope to influence through engagement, and engagement as a potential investor takes the Church Commissioners into discussion with the boards of some of the world’s biggest companies.

[Robert Halfon (Harlow) (Con)]

Does my hon. Friend agree that, when the Church is considering the use of its property investments, it has a charitable duty of care to the voluntary groups that may depend on the use of those properties?

[Tony Baldry]

Yes, of course, and I think that the Church will need to work out ways in which we can use Church property much more actively to engage with voluntary and community groups, as part of the big society initiative, which the Church has always supported and continues to support.

[Hugh Bayley (York Central) (Lab)]

4. What assessment the Public Accounts Commission has made of the adequacy of the National Audit Office’s resources to audit whether UK aid to other countries is spent in accordance with the Government’s development policies.

[Austin Mitchell (Great Grimsby) (Lab)]

I hope that this is not too much like a Tweedledum and Tweedledee show, but I have been asked to reply to my hon. Friend’s question on behalf of the Commission. The answer is, of course, that is it up to the Comptroller and Auditor General, acting and deciding independently, to determine the amount of resources that he needs to carry out audits. I can tell my hon. Friend, however, that the resources devoted by the Comptroller and Auditor General to audit the work of the Department for International Development is proportionate to its budget allocations and that, since January 2009, either audit contractors employed by the National Audit Office or audit office staff have visited DFID operations in half the Department’s 22 priority areas.

[Mr Speaker]

That was enormously helpful.

[Hugh Bayley]

I have never been so close to power and information in my life!

I, seriously, am concerned that the National Audit Office does not spend enough time with auditors in the field in developing countries to check that our aid is used appropriately and on the outcome of that spending, and, indeed, to safeguard against fraud. I ask my hon. Friend to ask the Comptroller and Auditor General to prepare a report on how the British aid budget is audited. Given that the budget is rising, the Comptroller and Auditor General should perhaps put more resources into it, and will he let us know whether he considers that he has sufficient money to do the job?

[Austin Mitchell]

I can tell my hon. Friend that I have never been so close to such a large volume, which, being slightly deaf, is a great advantage. However, again, this is a matter for the Comptroller and Auditor General to decide independently. I will certainly undertake to convey my hon. Friend’s views to the Comptroller and Auditor General via the Audit Commission, to raise the matter with it and to ask for a greater allocation in this area.

[John Mann (Bassetlaw) (Lab)]

5. How many prosecutions for failing to complete the registration form for the electoral register there were in 2009.

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

The Electoral Commission informs me that, in March 2010, it published data based on returns from 351 electoral registration officers showing that, in Great Britain, a total of 67 prosecutions were initiated in relation to a failure to provide information in response to the 2009 annual canvass. The commission does not hold data on the outcomes of those prosecutions. No such prosecutions were initiated in Northern Ireland in the same year.

[John Mann]

Why is the Electoral Commission not pressing returning officers to use the law, or does the Electoral Commission regard itself as the arbiter of good and bad electoral law?

[Mr Streeter]

The primary responsibility to decide whether to prosecute lies with electoral registration officers, and the hon. Gentleman may want to discuss this issue with the EROs in his community. The Electoral Commission does, of course, issue guidance to EROs and monitors their performance, and it will continue to do so.

[Sarah Newton (Truro and Falmouth) (Con)]

6. What recent representations the Church Commissioners have made to the Chancellor of the Exchequer on VAT relief on the repair of church buildings after March 2011.

[The Second Church Estates Commissioner (Tony Baldry)]

I refer my hon. Friend to the answer that I gave a few moments ago to my hon. Friend the Member for Bury St Edmunds (Mr Ruffley).

[Sarah Newton]

I thank my hon. Friend for that answer, which will be very much appreciated in my constituency.

As one of Cornwall’s most visited landmarks, Truro cathedral inspires thousands of people each year with its architecture, music and faith. The cathedral’s future relies on a £4 million investment in a vision to restore and redevelop it. The savings in VAT will be significant. Will my hon. Friend join me in thanking volunteers up and down the country who, like those in my constituency, give their time and talent freely to fundraise for their places of worship?

[Tony Baldry]

My hon. Friend makes an extremely good point. For all the churches and cathedrals in this country, there are hundreds of thousands of volunteers giving hours and hours of voluntary time to maintain the fabric of our very important heritage to hand on to future generations. We should all be extremely grateful to them.

[Dr Julian Huppert (Cambridge) (LD)]

8. What training and support the Church of England provides to those who become partners of Church of England vicars after their ordination.

[Tony Baldry]

When undertaking parish ministry, a curate and their family are able to access support from a number of people, including their bishop and their director of curate training.

[Dr Huppert]

Is the hon. Gentleman aware that there is a massive asymmetry between the treatment of those who become partners pre-ordination and post-ordination? If the Church expects such partners to play an active role, it should try to ensure that those who join their partner post-ordination get at least equivalent training.

[Tony Baldry]

I think everyone recognises that being a vicar is not an easy job. Betjeman succinctly observed:

“When things go wrong it’s rather tame

To find we are ourselves to blame.

It gets the trouble over quicker

To go and blame things on the Vicar.”

Every clergyman deserves our full support for what they do in the community, and their spouses—whether pre-ordination or post-ordination—deserve our support, because they are often on the front line of helping parishioners in the community. I very much hope that if any clergy spouse does not feel that she is getting full support, she will get in touch with me and I will make jolly sure that her diocesan bishops and others ensure that she gets the support that she deserves.

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

9. What recent assessment the Electoral Commission has made of the effectiveness of mechanisms to increase voter registration of and turnout by UK citizens who are resident abroad.

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

The Electoral Commission runs campaigns to promote voter registration among British citizens living abroad. The Commission informs me that the campaign in the run-up to the 2010 general election resulted in more than 40,000 overseas voter registration forms being downloaded from its website. In its report on the 2010 general election, the Commission said that the election timetable leaves insufficient time for overseas voters to receive and return their postal votes, and recommended that the Government should undertake a thorough review of the timetable for UK general elections.

[Greg Hands]

May I remind my hon. Friend what happened in the Polish elections of November 2007? Poland set up a number of polling stations in this country for its citizens to participate in their elections. Could we consider doing the same at British embassies or consulates abroad? The impression that I had in Hammersmith was of thousands of Poles queuing up at Ravenscourt Park to vote. It is something that we could quite reasonably copy.

[Mr Streeter]

I am grateful to my hon. Friend for the suggestion. We have looked at using British embassies abroad as places where expats can go and vote. There did not seem to be a great deal of interest when the suggestion was put forward by the Electoral Commission, but given the persistence with which my hon. Friend puts his case, we will consider it again.

public accounts commission

Tuesday 26th October 2010 Commons Chamber

The Chairman of the Public Accounts Commission was asked—

Electoral commission committee

Tuesday 26th October 2010 Commons Chamber

The hon. Member for South West Devon, representing the Speaker’s Committee on the Electoral Commission, was asked—

church commissioners

Tuesday 26th October 2010 Commons Chamber

The hon. Member for Banbury, representing the Church Commissioners, was asked—

Electoral Commission committee

Tuesday 26th October 2010 Commons Chamber

The hon. Member for South West Devon, representing the Speaker’s Committee on the Electoral Commission, was asked—

Firefighters (Industrial Action)

Tuesday 26th October 2010 Commons Chamber

15:32

[Jim Fitzpatrick (Poplar and Limehouse) (Lab)]

(Urgent Question): To ask the Under-Secretary of State for Communities and Local Government, the hon. Member for Bromley and Chislehurst (Robert Neill) if he will make a statement on what the Government are doing to halt the dangerous situation in prospect in London of industrial action by firefighters over the bonfire period.

[The Parliamentary Under-Secretary of State for Communities and Local Government (Robert Neill)]

As the hon. Gentleman knows from his own long experience of the fire service, the management of industrial disputes in the fire and rescue service is a matter for the fire and rescue authority concerned. The London Fire and Emergency Planning Authority holds the statutory duty to have plans in place to deal with such disruption. London has met this requirement by putting in place a contingency arrangement through a contract with a company, AssetCo.

I am retaining a close interest in the situation and I am in regular contact with the interested parties. I have emphasised that this dispute should be settled through negotiation. I understand that discussions are continuing, and I urge all concerned to find a solution to this disruptive action.

It is not the role of Government to intervene in the details of these negotiations. However, I would like to put on record my alarm and distress at the intimidation and bullying on the picket lines against AssetCo staff. At any time, abuse and violence against any front-line public servant, be they ambulance staff, firefighters or police officers, is never justified. I am shocked that it would appear that some trade union militants are now attempting to intimidate those providing an emergency service.

I have also made it clear that I find the threat of industrial action over the bonfire night period disgraceful. It is made worse by the fact that in this most diverse of cities, it will also be Diwali. When Londoners will be trying to enjoy those events, I am sorry that it seems that the Fire Brigades Union will be working actively to maximise the risk to them. Not only is the safety of families being put at risk, but the union is crudely attempting to put pressure on community groups to cancel their firework celebrations. I really am sorry to have to say that such behaviour is reckless and cynical and does no credit to the fire service. The service has great traditions, and I am sorry that they have been let down in this manner. The public will not think it a responsible way of conducting industrial action in the 21st century. They will see it for what it is: old-fashioned militant muscle-flexing.

[Jim Fitzpatrick]

I thank the Minister for his response to my question and for the answer to my letter of 15 October, which arrived two hours ago by e-mail.

I agree that no one wants to see the strikes, but the House should remember that when such strikes take place, the firefighters’ loved ones are in as much danger as the rest of their community. No one takes these decisions lightly, and as the hon. Gentleman knows, I know, because I have been there.

What is Mayor Johnson doing to try to resolve the dispute? Can the Minister confirm that new shift patterns have been agreed in other parts of the country after negotiation by the Fire Brigades Union with chief fire officers and local councils, and can he tell us why he thinks London is different? Does he think that the use of dismissal notices is an appropriate way to conduct negotiations? And, will he seek to ensure that Mayor Johnson and ACAS get involved to defuse the situation?

The threat of strike action on 5 November, Guy Fawkes night and Diwali has caught everyone’s attention and been criticised by all, but the next strike is planned for Monday 1 November, in six days’ time. Can the Minister assure us that his senior advisers and officials will do all that they can to get the key players first into the same building, then into the same room, and will keep them there until an agreement is hammered out? The public want to see the situation sorted. They want to see a real effort by the Government, the Mayor, the fire authority and the union. They want a resolution, and they want to see fire crews on duty, protecting us as they always do, not on picket lines.

[Robert Neill]

As I said in my first response, the statutory duty to provide fire and rescue services and proper contingency arrangements lies with the fire and rescue authority, in this case the London Fire and Emergency Planning Authority, which is of course appointed by and answerable to the Mayor of London. The Mayor has issued a statement today in which he expresses his confidence that appropriate contingency arrangements are in place, and I trust him and the fire authority to deal with that.

I entirely agree with the hon. Gentleman that any dispute that reaches this stage is very regrettable. However, it is worth bearing in mind, first, that there have been changes to shift patterns elsewhere in the country; secondly, that there have been protracted negotiations over many years in relation to the London situation; thirdly, that although dismissal notices have been used, the fire authority intends to offer to re-employ all its staff on fresh contracts, so nobody need lose jobs or pay; and finally, and perhaps significantly, the fire authority chairman has pointed out how the employers’ side offered and suggested a meeting of the national negotiators on that very day, 5 November. Instead of accepting that offer, the union, I very much regret to say, chose to call a strike for that day.

[Chris Williamson (Derby North) (Lab)]

I thank the Minister for updating the House on the situation.

Any strike by the fire service is obviously a very serious matter and one that the public will understandably and justifiably be concerned about. We understand that concern, and our position is absolutely clear. Bonfire night is one of the busiest periods in the year for the fire service and will in all likelihood be even busier this year, as Diwali falls on the same date. Whatever the issues surrounding the proposed new shift patterns and contracts, a strike by the fire service on bonfire night would potentially put Londoners at risk. It is not supported by the public, and it does not have our support either. The public will rightly expect both sides in this dispute to do everything that they can to avoid an unnecessary strike. We urge both sides to sit down and talk to each other to reach an agreement as soon as possible.

Further to the question by my hon. Friend the Member for Poplar and Limehouse (Jim Fitzpatrick), may I tell the Minister that he has our support in seeking a resolution to this dispute as soon as possible? What discussions has he had with the London Fire and Emergency Planning Authority, the Fire Brigades Union and the Mayor of London to encourage all parties to come together to reach an agreement?

[Robert Neill]

I am grateful to the hon. Gentleman for his support and for those observations and I am sure that everyone will welcome the condemnation implicit in his statements of some of the behaviour that we saw. He is right to say that there is scope to decide when a strike takes place and choosing 5 November was especially inappropriate in the circumstances. I hope that his condemnation of that decision will extend to a condemnation of the intimidation of those people who sought to provide cover in London on Saturday.

I have made it clear from the beginning that I hope that this will be settled by negotiation because it is best dealt with at a local level. I do not believe that Ministers intervening in the detail of that negotiation would be appropriate, but we have made it clear that our officials are in contact with the parties. The chief fire and rescue adviser has kept me apprised of all the developments throughout the recent deterioration in the circumstances and will continue to do so. Of course, he continues to receive information from all the interested parties.

Things need not happen this way, and I take it from the hon. Gentleman’s words that the Opposition do not wish things to happen this way. I hope that we can say that both sides of the House conclude that this is not a mature way to deal with a dispute that involves a critical service. I hope that we can achieve a resolution and, above all, I hope that we will not see Londoners put at risk on an especially high-risk day. That would be a regrettable bit of brinkmanship, and that is why I have used the strong language that I have—it reflects the views of the public on the way in which they have been used in this matter.

[Bob Blackman (Harrow East) (Con)]

Voters in my constituency are looking forward to celebrating Diwali and Guy Fawkes night on 5 November. Does my hon. Friend agree that five years is long enough to negotiate shift roster patterns? Is it not time that we considered reviewing whether no-strike arrangements should be introduced for the fire service nationally?

[Robert Neill]

Having said to the hon. Member for Derby North (Chris Williamson) that I do not think that it is appropriate for the Government to be involved in the detailed negotiations, which are best dealt with between the employers and employees, I shall not respond any differently to my hon. Friend. However, I understand the point that he makes, and it is worth reminding people that this is not something that has happened out of the blue. There has been a long build-up to this and there is a sense of frustration. I do not think that the Government have any plans to change the overall framework of industrial relations, but I want to ensure that we encourage the parties concerned to reach a resolution. My priority is to ensure that appropriate contingency arrangements are in place to keep Londoners safe in the event of this happening—and I am sure that that is the case. We must also ensure that we review those contingency arrangements and keep them up to date across the country as a whole.

[Kate Hoey (Vauxhall) (Lab)]

Does the Minister agree—he is a fairly reasonable man—that it was reckless of the London fire commissioner to serve the notices to make people redundant? Does the Minister realise that this is not now about shift patterns? Most of the firemen and women whom I met on the picket lines when I went to talk to them in my constituency at the weekend are happy to discuss that issue, but they want the threat of redundancy—which has been brought in, but not for a very long time—to be withdrawn. Can the Minister intervene with the commission and the chairman of the LFEPA to get those threats withdrawn, to get round the table and to get this settled before next Monday?

[Robert Neill]

Two points arise from the hon. Lady’s question. First, it is scarcely appropriate, if we believe in trusting locally elected representatives, for Ministers to seek to micro-manage the negotiations. The people involved, at the London level, on both sides of the dispute are mature and experienced people, and I hope that they will be best placed to resolve it. Secondly, the issue of the dismissal notices sometimes arises in industrial relations disputes. It has not happened in the context of the fire brigade before, but as my hon. Friend the Member for Harrow East (Bob Blackman) observed, this situation did not arise suddenly, but at the end of a protracted five-year negotiation. I am not saying what tactics the parties should use, but the lengthy context has to be borne in mind.

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

As somebody who has in their constituency the London fire brigade headquarters, three fire stations and a fire training centre, and who has met both management and the unions in the past fortnight, may I ask that the message be passed on, first, that most fire officers are really keen that there be a resolution, because they do not want to go on strike, and secondly that on the shift patterns, there is not much objective distance between the management and the unions? It should be capable of resolution. I want to add my voice to those who say that there is a way forward by negotiation rather than this clearly unwanted industrial action, which would affect the whole city.

[Robert Neill]

I agree with my hon. Friend. It is perhaps significant that the management side adjusted its offer and was prepared to change, to some degree, the extent of the alteration of the hours to reflect earlier discussions. I hope that that will be the spirit in which the negotiations are taken forward.

[Mr David Lammy (Tottenham) (Lab)]

Over the weekend, there was a fire in Enfield in which a house burned to the ground, and there are serious suggestions that the stand-in fire officers who turned up pointed their hose in the wrong direction. Will the Minister say more about the contingency arrangements, and will he also say what his assessment is of fire services in London, given the 13% cut in the spending review?

[Robert Neill]

I have been acquainted with the reports on the Enfield incident. The chief fire and rescue adviser liaised with the commissioner on that matter. Sadly, I have also been acquainted with reports—in some cases, documented on camera—of the harassment that the crews endeavouring to provide cover had to suffer. They had to do a job under extremely difficult—frankly, unacceptably difficult—circumstances. We want to ensure the best possible standards of cover, and we condemn anyone who seeks to undermine the cover that people attempt to provide. I am satisfied that the London fire brigade—I know it well, as does the right hon. Gentleman—operates to the highest professional standards and will do its level best, despite the difficulties, to make arrangements available. Those arrangements are made via the contract with AssetCo, which is a company with considerable experience in the fire service field, and involve the provision of services using up-to-date fire brigade equipment and persons trained to use that equipment.

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

I know that the Minister shares my concern about reports from the BBC and elsewhere about engines being stopped by picket lines during last Saturday’s strike. Will he reassure us again that the Government will do all they can to support emergency crews who do want to work, and to stop any intimidation and harassment?

[Robert Neill]

My hon. Friend is absolutely right. It cannot be acceptable, whatever the situation or dispute, for fire engines attending to a call to be forced to pull over to the side of the road by people who have pursued them on motorbikes, in cars and sometimes in black taxi cabs, for their water tanks to be emptied to render them useless, and for equipment to be removed, and nor is it acceptable for threatening text messages to be sent to people trying to work. That is utterly unacceptable behaviour, and I am sure that every Member finds it revolting. Of course, the Government will do all they can. I know that the fire commissioner is liaising with the police commissioner. The police endeavour to give appropriate support, but of course, given the nature of things, their resources are stretched as well. I am confident, however, that the Metropolitan police will give all appropriate support to those who are working to carry out a statutory duty.

[Jeremy Corbyn (Islington North) (Lab)]

Does the Minister not understand the anger of firefighters—who have kept this city safe for so long, and whom we all rely on and applaud when they put fires out and make places safe—when they are sent dismissal notices and are told that they have to accept a new contract without any negotiation, and when we have a Mayor who refuses to meet them and a Minister who is apparently not even prepared to meet the Mayor to discuss a resolution? Can the Minister not use this opportunity today to send a message to the Mayor and the chair of the fire authority to meet the union now, and come to an agreement that does not involve the wholesale dismissal of loyal public sector workers who have kept this city safe for so long?

[Robert Neill]

The context of my response has already been set out. It is quite clear that the dismissal notices, which are not issued lightly, came only at the end of negotiations that have gone on for something like five years. I am not going to start lecturing the Mayor of London on how to conduct matters, particularly when the management side on the fire authority has suggested that there should be negotiations through the recognised national negotiating body on 5 November. I would have hoped that the union would take up that offer, but instead it chose to call a strike. Perhaps the best people to advise, therefore, are those in the union, who should be asked why they are not taking up the offer and getting round the table on 5 November, rather than walking out.

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

What additional resources can the Minister call on if the contingency arrangements fail?

[Robert Neill]

I do not think that there is any evidence to suggest that the contingency resources will fail. The important thing is to ensure that no impediment is put in the way of those operating the contingency resources, to ensure that they do just that. Under the Fire and Rescue Services Act 2004, the legal duty to ensure that those resources are in place rests with the fire authority, to which we offer advice and assistance in carrying out that duty. The London Fire and Emergency Planning Authority has chosen to meet those statutory requirements through the contract that it has. It has operated satisfactorily, despite the difficultly on Saturday, and I am sure that the authority is refining its operation in the event that it should be necessary on a future occasion.

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

Only a few months ago, I came to this House with the families of FBU members who had given their lives to save members of the public. The FBU does not take industrial action lightly, and it is taking it only because unacceptable statements have been made, such as statements about five years of negotiations. Negotiations started two months ago, and then unprecedentedly, as the Minister said, all FBU members in London were threatened with the sack if they did not sign up to new contracts. The situation now is that the Mayor refuses to intervene, while the leader of the authority—whom the Audit Commission has described as confrontational, and his colleagues describe as, at times, hysterical in his approach to the issues—is aggravating the situation. Therefore, I believe that it now behoves the Minister to intervene to save us from the dispute and to bring both sides together to ensure a negotiated settlement; otherwise lives will be put at risk not by the FBU, but by this Government and their representatives on the fire authority.

[Robert Neill]

Ultimately, I am afraid, the risk to life is caused by those who chose to strike on that particular date. I am afraid that I just cannot accept the hon. Gentleman’s proposition that what has happened comes outside that context. I do not believe that such decisions are taken lightly, but I have to say—and I say it again—that I regret that the FBU has made such a serious misjudgment on the timing and calling of the strike. I repeat: discussions have been going on for upwards of five years to try to resolve the matter—they have been on-off—and I am afraid that the hon. Gentleman is misinformed to say that what has happened has been suddenly plucked out of the air, in isolation.

I do not intend to lecture the statutorily responsible bodies, which are democratically elected and accountable, on how they carry out their job, particularly when they have made an offer to negotiate that has apparently been rejected on the very day that they could have been sitting round the table. The best thing that the hon. Gentleman could do is use his good offices and contacts in the union to persuade them to get back round the table on 5 November, and if not hopefully before that.

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

The Minister will know that I have championed the cause of firefighters in my constituency. As a member of the all-party fire safety and rescue group, I want to ask him about the cynical decision to hold a strike on bonfire night, when the number of incidents is sometimes double or triple what it usually is. Will he work with the Opposition to bring forward emergency legislation to stop the strike on bonfire night?

[Robert Neill]

With every respect to my hon. Friend, whose interest in the matter I acknowledge, I do not think that the introduction of emergency legislation will help to resolve a difficult scenario. We need to ensure that we make some serious progress. However, I want to take this opportunity to say that I stand second to none in my respect and admiration for the fire service and for the men and women who work it up. I have been involved with it, in the various forms of my public life, for the best part of 25 years, which is why I am so saddened that the leadership of the union has so badly misjudged the timing of this dispute and let down the brave men and women among its membership.

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

Is it not clear that the lamentable settlement that the Minister achieved in the spending review will result in cutbacks not just in London but across the rest of the country, and that that will lead to disagreements and disputes fanning out everywhere? For instance, is he happy about reports that the number of fire engine appliances in Nottinghamshire is to go down from36 to 30?

[Robert Neill]

The attempt by the hon. Gentleman to distract us from the immediate situation in London by making reference to the spending review does him little credit and is frankly unworthy of the seriousness of the situation. This dispute was in existence long before the spending review took place, and I hope that he will concentrate on resolving it. We can have debates about the spending review in more appropriate circumstances.

[Mr Stewart Jackson (Peterborough) (Con)]

I speak as a former member of the London Fire and Civil Defence Authority and as only the second graduate of the parliamentary firefighters scheme. I congratulate the Minister on his robust line, which better represents the public than the hard-left leadership of the Fire Brigades Union. Is it not a fact that the previous Labour Administration allowed the Fireguard resilience planning programme to fail? Will my hon. Friend give the House an undertaking that he will work with the Chief Fire Officers Association and other key stakeholders to ensure that resilience planning is in place, particularly in the run-up to the Olympics, so that we can be prepared for any further industrial action and other eventualities?

[Robert Neill]

I am grateful to my hon. Friend for his interest and expertise in these matters. He is right to say that Fireguard did not succeed; that leaves a limited number of options available to us. It is also fair to say that, since becoming a Minister, I have made it my business to keep in contact with all the principal players, including the Chief Fire Officers Association and the union, whose general secretary and assistant secretary I have met on a number of occasions. I want to put it on record that my door remains open to them as much as to anyone else.

The Audit Commission recently reported on resilience, and it is important that we should never be complacent about it. That applies right across the country. The chief fire and rescue adviser, together with officials in the Department, continue to keep in touch with the fire authorities to ensure that we review and maximise the resilience arrangements that are available to the fire and rescue authorities.

Transport (Investment)

Tuesday 26th October 2010 Commons Chamber

15:58

[The Secretary of State for Transport (Mr Philip Hammond)]

With your permission, Madam Deputy Speaker, I would like to make a statement on the Government’s investment plans for our transport networks. During the course of my remarks, hon. Members might find it helpful to refer to the documents that I placed in the Library of the House and the Vote Office a few minutes ago.

As my right hon. Friend the Chancellor explained last week, the decisions that we have taken to cut waste, end lower-priority programmes and reform the welfare system allow us to invest in Britain’s long-term economic growth and to prioritise transport infrastructure to support that growth. We have already announced a green light for Crossrail and for tube upgrades, plans for investment in low-carbon vehicles and recharging infrastructure, and work on a high-speed rail network. Work is continuing on the evaluation of additional investment in major rail projects, and I expect to be able to make an announcement to the House on that in the next few weeks.

Today, I can confirm a programme of investment in our crucial strategic road network, managed by the Highways Agency, and in our local transport networks. We will continue to invest in capital maintenance, spending £5.9 billion over the next four years on unglamorous but important works to maintain the integrity of the network, both strategic and local.

We have also allocated more than £180 million over the four-year period for high-value minor enhancements to the strategic road network. We are taking action to reduce the cost of proposed Highways Agency schemes by re-specifying, renegotiating with suppliers and improving governance and control. Thanks to those decisions, I can confirm that funds will be available for sustainable upgrades to the strategic network to tackle congestion hotspots, delivering network-wide benefits that provide very high returns on investment.

I can confirm today that the eight Highways Agency major schemes currently under way will be funded to completion and open to the public in the next two years. I can also announce today funding for 14 new projects, including the schemes announced by my right hon. Friend the Chancellor last week, to commence on site by April 2015. These are: the A11 Fiveways dualling; the M4 and M5 junction north of Bristol; the M6 between junctions 5 and 8 in Birmingham; the M62 between junctions 25 and 30 near Leeds; three schemes on the M1 between Derbyshire and Wakefield from junctions 28 to 31, 32 to 35A and 39 to 42; four schemes around Manchester from junctions 8 to 12 and from 12 to 15 on the M60; junctions 18 to 20 on the M62 and from Knutsford to Bowdon on the A556; improvement of the A23 between Handcross and Warninglid; the completion of the upgrading of the M25 with a managed motorway scheme for peak time hard-shoulder running between junctions 23 and 27 and between junctions 5 and 7. Those essential investments will cut congestion, improve journey times and, most importantly, support economic growth. Every pound we spend on these schemes will generate on average £6 of benefits.

I can also confirm that work will continue on developing a further set of Highways Agency schemes ready to start in the next spending review period if funds become available. A detailed list is included in the documents I referred to earlier. There is also one last group of four current Highways Agency schemes that will be reviewed to see if they still represent value for money and can be progressed for the next spending review period.

Important as strategic roads are to the national economy, many of the highest value-for-money proposals are those that address the needs of the local road and public transport infrastructure that supports the economies of our cities, towns and rural areas. That is why, last week, we announced our commitment to completing major local projects worth more than £600 million—including measures to improve access to Weymouth in time for the Olympics and acceleration of work on the Tees Valley bus network, and, I can confirm, the intention to invest up to £350 million to complete the upgrade of the Tyne and Wear metro.

We have also announced our intention to proceed with private finance initiative schemes to extend the Nottingham tram network and deliver sustained improvements in highways maintenance in Sheffield, Hounslow and the Isle of Wight. My Department will work urgently with the four local authorities concerned to ensure that we can deliver these schemes within the available funding.

My right hon. Friend the Chancellor also announced last week that we will invest more than £900 million over the next four years on new local authority major schemes: including a new bridge over the Mersey at Runcorn, partly funded by tolls; improving access to Leeds station; and extending the Midland Metro tram line from Snow Hill to New Street through Birmingham city centre.

I can confirm today that a further seven major local authority projects have also been given the green light, subject to planning and other approvals. They are: a new bus interchange and associated transport improvements in Mansfield; a new bypass, which will take traffic away from communities in Sefton; an integrated package of sustainable transport improvements in Ipswich; major improvements to the M5 at junction 29 east of Exeter, providing access to new housing and employment areas; a bypass to the north of Lancaster, improving connections between the port of Heysham and the M6; improvements on the A57 east of the M1 junction 31, near Todwick; and a new northern distributor road in Taunton to provide additional cross-town capacity and access to areas of brownfield land.

Those schemes, worth about £300 million in total, have been selected from a pool of projects with proven business cases. They are listed as supported schemes and shaded green in the list to which I referred earlier. Our duty, however, is to ensure that every pound that is spent is essential. Even with those priority schemes, I expect the local authority promoters to work with my Department to ensure that every opportunity for cost saving has been taken and every source of alternative contributions has been fully explored before funding is confirmed in January next year.

Although the House will welcome the decisions, Members on both sides of the House will want to know how we propose to handle the remaining schemes. The £600 million plus remaining for additional new projects, after the announcements already made, demonstrates the importance that we attach to local authority major schemes, but it will not be enough to fund all the schemes proposed by local authorities. In the list that I have placed in the Library, I have included all currently submitted schemes, including three that previously had conditional approval and that we will now seek to progress to full approval, showing how we propose to categorise each of them.

For 22 schemes, for which my Department has completed a value-for-money assessment in the past four years, we will invite best and final funding bids from the development pool—the schemes shaded amber in the list. Promoters will be challenged by my Department to consider the scope of the scheme, its cost, lower-cost alternatives and their ability to contribute more locally. Those who can make the best case are the most likely to receive funding, which will be confirmed by the end of 2011.

Further analysis will be carried out on another 34 schemes, for which the Department does not currently have an up-to-date assessment, to determine whether they can go forward to join the development pool and bid for a share of the £600 million plus of funds available. Those schemes are shaded blue on the list. A decision will be made by January 2011.

This competitive process will ensure that the greatest possible number of schemes, with the best value for money, will be able to proceed, facilitating economic growth and creating jobs across the country. Under regional funding allocations, regional and local bodies were encouraged by the previous Government to identify a large number of schemes for longer-term prioritisation. Many of those were in the early stages of development, with no business cases submitted to the Department for Transport before the cut-off that we announced on 10 June this year.

In the longer term, I want such decisions on local transport priorities to be taken out of Whitehall and placed in the hands of local people. My Department will work with the emerging local enterprise partnerships and local authorities to identify the best approach to local decision making on future transport priorities.

I have set out our decisions and what they mean for our strategic and local transport networks. The measures will help to deliver long-term, sustainable and affordable economic growth in this country. The difficult choices made by the Government have allowed us to invest in the future. I commend the statement to the House.

[Maria Eagle (Garston and Halewood) (Lab)]

May I begin by thanking the right hon. Gentleman for sending my office a copy of his statement in advance? Helpfully, he also placed a copy of the document to which he has been referring in the Vote Office. On my way in, I saw what looked like a bus queue there, because the document was late—a bit like some buses. None the less, it is better late than never. Members on both sides of the House will be grateful to have had sight, at least before he began his statement, of a copy of the document showing what has happened to the schemes.

This is the first time that the right hon. Gentleman and I have faced each other across the Dispatch Box, and I look forward to further such exchanges. We have at least one thing in common: he does not want to be in his current job because he would rather be the Chief Secretary to the Treasury, and I do not want to be in my job, because I would rather be in his job—in a Labour Government of course. We will see which one of us gets what we want first.

I welcome the confirmation of the projects that the Secretary of State listed in his statement. They were planned by the last Government, and I am pleased that he has recognised the need for that vital investment to be protected. Let me say at the outset that we have pledged to be a responsible Opposition, and that when I agree with the Secretary of State, I will support him and work with him. Transport is critical to our national interest, and investment in infrastructure is vital to our construction industry and the rebalancing of our economy from financial to real engineering. To the extent that we can find common ground, I certainly intend to ensure that we work together.

As a north-west Member of Parliament, I especially welcome the confirmation of much of the funding that the last Government agreed for the second Mersey crossing between Runcorn and Widnes and the electrification of rail lines between Lime Street, Manchester, Preston and Blackpool, which will mean more reliable, greener services with more capacity and reduced journey times. Those projects are vital to the regional economy, and it is absolutely right for them to proceed.

While Members on both sides of the House will welcome the commitments made today to a wide range of important transport infrastructure projects, the statement raises a number of questions. The main purpose of the schemes is to tackle congestion, yet at the same time the Secretary of State has announced hikes in rail fares that may well drive people on to the roads. Indeed, I believe that they will. Does the Secretary of State accept that lifting the cap on regulated rail fares and allowing them to rise to 3% above inflation from one year to the next will further squeeze hard-working people who commute? Many have already been hit by cuts, including cuts in child benefit, and they are about to face a increase in the VAT rate to 20%, an increase in employees’ national insurance contributions, and, if they are in the public sector, an increase of 3% in their pension contributions. Just how much more can commuters be expected to take?

Does the Secretary of State accept that, according to the assumptions on inflation by the Office for Budget Responsibility, the increase means that commuter fares will rise by 33.6% by 2015? That will simply drive people off the railways and back on to our already congested roads. His predecessor as spokesperson in opposition, the Minister of State, Department for Transport, the right hon. Member for Chipping Barnet (Mrs Villiers)—who is present—said that a 3% rise in fares would be enough to

“price people off the railways”.—[Official Report, 17 July 2007; Vol. 463, c. 149.]

What does he think that a 33.6% increase will do?

Why did the Secretary of State argue in an interview with The Times on Saturday that the fare rises would be 10% over four years? He said:

“If you are paying £1000 for your season ticket now, it could cost you £1100 at the end of the period”.

I know that, as he told The Times, the Secretary of State loves his Jaguar—I love Jaguars as well, especially as they are built in my constituency—but let me tell him that a season ticket from Weybridge to London costs £2,272 today, and that, as a result of these fare rises, it could cost £3,035 by 2015. Someone who aspires to be Chief Secretary to the Treasury should be able to tell that that increase is much more than 10%.

How many of the schemes that the Secretary of State has announced today will, under the revised plans, be completed later than was originally intended? What percentage of the cost of those schemes will now be covered by the current spending review, and how many will see their completion delayed until the next? What assessment has the Secretary of State made of the economic impact of the delays on jobs, growth and competitiveness? How many of the schemes have been approved on the basis of the original proposals that he inherited, and which of them have been scaled back? What are the implications of that for each scheme?

What consultation has been carried out with local government and local communities about any changes to the schemes? What percentage and amount have been moved from Government expenditure to PFI? Has the Secretary of State completed any assessment of the impact of the reduction in transport capital expenditure on our wider transport networks? What assessment has he made of the impact on our road network, and likely increases in congestion, of the significant increases in train fares and the cuts in local bus services that the comprehensive spending review set out? What assurance can he give us that these schemes will lead to high-quality manufacturing jobs in the United Kingdom, with contracts being secured by British industry?

Finally, does the Secretary of State agree that it was quite wrong of him to spin his comprehensive spending review settlement as a huge victory? Is not the reality that he over-spun his settlement? I have here an analysis by the Institute for Fiscal Studies of the impact of the CSR on Government Departments. Helpfully, it has listed Departments as winners and losers, and I am sorry to have to tell the Secretary of State that the IFS says he is a loser.

The impression given by the Secretary of State is that cuts in his budget have no impact on capital investment. However, on top of the 21% reduction in resource spending, there is to be an 11% cut in spending on capital. That is 11% less spent on vital infrastructure, so it is quite wrong for the right hon. Gentleman to suggest that he has somehow secured a great victory or that spending is not being cut. No doubt we will have many more exchanges across the Dispatch Box, not least when the right hon. Gentleman announces his rail investment proposals.

The Labour party aspires to have an integrated transport policy. Perhaps the right hon. Gentleman can in future have an integrated transport statement and tell us about all the investment on the same day.

[Mr Hammond]

I thank the hon. Lady for her comments and welcome her to the Dispatch Box. I welcome the tone of her initial remarks at least; I am sorry it degenerated a bit towards the end. I am also sorry to have to tell her that I cannot write as quickly as she can ask questions so I am not sure that I took them all down, but I will try to deal with some of the issues she raised.

On the departmental settlement, frankly I think it is a bit rich for the hon. Lady to say that an 11% reduction in transport capital expenditure is a disastrous settlement, because when her Government were in office they were planning a 50% cut in total public capital expenditure. In the comprehensive spending review, the Government had to take difficult decisions about what to prioritise. The Department for Transport faced the smallest reduction in capital expenditure of any Department and it now has the second largest capital budget in the Government. I would have thought that the hon. Lady would welcome that as a way of protecting transport infrastructure investment.

The hon. Lady asked about rail fares, and although today’s statement is not primarily about railways I am happy to deal with that issue. Of course I would have preferred not to raise the cap on regulated fare increases, but we faced a choice between going ahead with the investment in additional capacity to reduce overcrowding and improve the attractiveness of the railways to passengers or increasing fares, and I took the decision that the right long-term solution was to increase fares for a period of three years. But let me be clear: I agree with the hon. Lady that fares cannot increase indefinitely, and the medium-term solution to the challenge on our railways has to be getting the cost base down so that the railways are affordable for both passengers and the taxpayer, who supports the railways through subsidy.

The hon. Lady asked whether the schemes announced today would be completed later than originally planned. Most of these schemes did not have a specific timetable, but I can tell her this: over the next four years transport investment will be greater in cash terms than it was over the last four years, so we are not talking about some massive rescheduling of the programme.

The hon. Lady asked about consultation with local government. All the local authority schemes I mentioned today were, of course, proposed by local authority sponsors, and there is constant dialogue between local authorities and my Department. In line with Mr Speaker’s recommendations, we have made this statement first to the House of Commons, but local authorities will be informed during the course of today of what I have said about their schemes, and we will now engage in intensive dialogue with them as we take these proposals forward.

We believe that investment in highway infrastructure and local transport schemes is crucial to making the UK an attractive place for manufacturing investment, both indigenous and inward. As the hon. Lady knows, I cannot promise her that the jobs created directly by this investment will go to UK providers because the schemes will be subject to the European procurement directive rules and will have to be tendered in an open and transparent way, but I am sure that our announcements today will support the revival of the UK manufacturing base, which is critical to this country’s future.

[Anna Soubry (Broxtowe) (Con)]

While I welcome, after years of dithering by the last Administration, a decision on the extension of the tram network in Nottingham—one of the routes passes through my constituency—please will the Secretary of State look at Nottingham city council’s plans for a workplace parking levy? I also ask him to consider the effect of that levy on jobs in my constituency. Boots employs more than 7,500 people at the Beeston site. The workplace parking levy will threaten jobs throughout greater Nottingham.

[Mr Hammond]

I am grateful to my hon. Friend for her remarks. I know that the Nottingham tramway is not universally popular and that the workplace parking levy is even less so. However, if we are serious about a localism agenda, we will find that sometimes, perhaps often, the things that elected local authorities choose to do on behalf of local residents are not always in accordance with our own preferences and priorities. That is in the nature of localism, and I embrace it.

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

I welcome the positive parts of the statement, but there are major problems relating to the very important strategic schemes currently funded and identified through regional allocations. Does the Secretary of State agree with his statement to the Select Committee on Transport that structures wider than local economic partnerships would be necessary to examine such schemes in the future? Does he still maintain that this will bring more localism, given that we are told that future schemes of this nature will be funded partly through the regional growth fund and that decisions on that fund are to be taken entirely nationally?

[Mr Hammond]

I am glad that the hon. Lady has raised the issue of the regional growth fund. It is important to reiterate that that fund will be open to transport projects; they will be able to bid for funding from it. However, that is not in substitution for the very significant allocations that I have announced today—it is in addition. I hope that some of the smaller local authority schemes, in particular, may be worked up as bids to the regional growth fund.

The hon. Lady talks about local enterprise partnerships. As I said in my statement, my objective is to move to a system that more clearly allows local communities and local authorities to determine how the funding allocated to their area should be spent. The previous Government introduced the regional funding allocation system. The mechanisms through which that was intermediated are now to be abolished, along with the regional structure of government. What I said to the Select Committee and repeat today is that my Department will carefully examine the LEPs as they come into being. Of course they are a bottom-up structure, rather than a top-down one, so different LEPs will look different. We will need to see how they are organised and whether they are on a sufficiently strategic scale to be allocated transport funding individually or whether we might ask them to form strategic alliances with other LEPs as a basis for transport funding over relevant geographical areas.

[Several hon. Members]

rose—

[Madam Deputy Speaker (Dawn Primarolo)]

Order. May I just inform hon. Members that a large number of you want to get in, so by asking a short question to the Minister and receiving a short answer you will help each other enormously in ensuring that all the points are made? I call Martin Horwood.

[Martin Horwood (Cheltenham) (LD)]

Thank you, Madam Deputy Speaker. May I also thank the Secretary of State for the advance notice of his statement that was given to me? I welcome the overall investment that he has announced today, his commitment to local decision making and, specifically, the investment in road maintenance, rail, light rail, trams and locally integrated transport schemes. I am sure that those will be welcomed across the country. As a Gloucestershire Member— I am sure that he will have expected me to say this—I regret that the redoubling of the Swindon to Kemble line has not been included in any of the documents, despite being a highly economic and economically very important scheme. May I ask him whether or not that is precisely the kind of scheme that in future local communities will be able to express as a priority under the localism agenda that he has talked about, and whether or not he agrees with me—

[Madam Deputy Speaker]

Order. I say to the hon. Gentleman that I have only just advised the House that hon. Members could help each other by being brief. I would be grateful if the Minister would now answer.

[Mr Hammond]

The Swindon to Kemble project, which my hon. Friend mentions, was uniquely the only Network Rail scheme brought forward under the regional funding allocation system. It had not submitted a business case to the Department before the cut-off date of 10 June, but it is the type of scheme that might be put forward in a future locally prioritised funding process. Alternatively, it might be submitted as a proposal for control period 5 in the Network Rail settlement from 2015.

[Clive Efford (Eltham) (Lab)]

Will the Secretary of State provide some clarification of the Prime Minister’s comments at the CBI yesterday—reported in today’s media—where he seemed to give a commitment to building the Thames gateway bridge, which, as the Secretary of State will be aware, was abandoned by Mayor Boris when he was first elected? That seems to suggest a lack of communication between City Hall and No. 10. People in south-east London are demanding that something be done about the daily congestion that builds up at the Blackwall tunnel. If the Secretary of State is in communication with the Mayor, will he consider that option since many local people are demanding that something be done about that daily nightmare?

[Mr Hammond]

I have not seen my right hon. Friend’s speech, but I suspect that he was referring to the statement made last week about the Dartford crossing, where we have made the tough decision to increase charges. We have also made a commitment that the crossing will not be sold, as the previous Government proposed, and that we will work up proposals for additional capacity crossing the Thames at or in the region of that area.

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

I welcome the upgrading of the Blackpool tramway and the many other infrastructure improvements in the north-west that will remove barriers to economic growth. Will the Secretary of State join me in congratulating the work of the Northern Way, which has provided such an excellent evidence base to help with the quality of transport policy making in the north? What role does he see the Northern Way playing as we go forward in ensuring that we have excellent quality data on which to judge policy?

[Mr Hammond]

I am grateful to my hon. Friend for that question. The Northern Way has produced some extremely valuable work that has informed a number of the decisions that have been taken and I look forward to its continuing to contribute to the debate.

[Mr Bob Ainsworth (Coventry North East) (Lab)]

May I tell the Secretary of State that the Coventry and Warwickshire travel-to-work area runs on a north-south axis and, despite the congested state of the roads and the existence of a railway, a fraction of 1% of the journeys take place by rail? That is why the Coventry to Nuneaton rail upgrade is so important. It seems that he has put us in the waiting room for the waiting room and that we have only until January, to save the scheme at all. I have no doubt that if the Coventry and Warwickshire local enterprise partnership was up and running, that would be the top priority for it, but will the Secretary of State advise us how on earth, when that LEP is not even in existence yet, we can impress on his Department the importance of this scheme and get it into a state for approval before January? I would like some advice.

[Mr Hammond]

To clarify, the scheme to which the right hon. Gentleman refers is one in the pool of projects submitted to the Department before the cut-off date that we announced in June, but it has not yet been appraised by the Department. The Department will now make a rapid assessment of the scheme—the right hon. Gentleman asserts that it is extremely high value for money, but I can tell him that the promoter of every single scheme that I have come across asserts that their scheme is high value for money. A number of these schemes will then be accelerated into the development pool so that we can do further work on them with the promoters during 2011 with a view to allocating funding at the end of 2011. I would say to the right hon. Gentleman, as I said to my hon. Friend the Member for Cheltenham (Martin Horwood), that if a rail scheme is not successful in this funding process, it will of course be possible for it to be put forward as a proposal for the next control period of Network Rail’s capital enhancement settlement.

[Andrew Percy (Brigg and Goole) (Con)]

For years, Yorkshire and the Humber has had some of the lowest per capita transport funding in the country, so I welcome the investment in Yorkshire and the Humber today and specifically the two schemes in the Humber area—the A63 Castle street and the A161—that are likely candidates for funding into the future. May I ask the Secretary of State whether he will take into account when making a final decision the massive investment that is going into the ports on both the north and south banks of the Humber? Will he also give us any further details of when a final decision will be taken on whether those schemes will be funded?

[Mr Hammond]

Transport funding in Yorkshire and the Humber is now about average, although I accept the comments that my hon. Friend has made about historical levels of funding. The two schemes to which he referred will not be funded during the current spending review period but they will continue to be worked on as schemes for funding in a future spending review period, as and when funding becomes available. The appraisal model that the Department uses will take account of the effects that he talks about and the external benefits that can be delivered.

[Mr Brian H. Donohoe (Central Ayrshire) (Lab)]

In reassessing the M54-M6 toll road, will the Secretary of State take into account travel times? Over the years, travel times between London and Scotland have seemed to be increasing. Will he take that factor into account?

[Mr Hammond]

Travel times and potential journey savings are one of the key factors that the current model takes into account. The M54-M6 toll link is in the group of schemes that will be reassessed, because the Department needs to reassure itself that the value-for-money case for the scheme still applies.

[Ben Gummer (Ipswich) (Con)]

I am delighted that funding for “Ipswich—Transport Fit for the 21st Century” is being brought forward, a decision on which the previous Administration dithered, and I thank the Secretary of State for having regard to my many letters to him on the matter. Will he describe in greater detail the hurdles over which the county council now needs to leap to achieve funding in January?

[Mr Hammond]

The Under-Secretary, my hon. Friend the Member for Lewes (Norman Baker), will be in Ipswich tomorrow to examine the scheme, when there will no doubt be an opportunity to discuss those issues with the promoters. Of course, the promoters will need to obtain any necessary planning and other statutory consents to allow schemes to go ahead. We will engage with the local authority promoters to ensure that any unnecessary cost has been squeezed out of the scheme and that every opportunity to secure supporting non-public-source funding has been explored and exhausted. By doing that, we will ensure that the total pool of schemes that we can support is as large as possible and that the economic benefits to the economy as a whole are as great as possible. We will undertake that work with the local authority promoters as a matter of urgency.

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

I thank the Secretary of State for receiving a delegation from Coventry on the Nuneaton to Coventry line, which is better known as the NUCKLE project. Further to the remarks made by my right hon. Friend the Member for Coventry North East (Mr Ainsworth), the scheme has been around for several years, and I appreciate the fact that it is still in the running. Even under the previous Government—we had a go at them—officials kept knocking the scheme back for a variety of reasons. Will the Secretary of State assure me that the scheme will get a fair wind this time round?

[Mr Hammond]

I assure the hon. Gentleman that all schemes will be objectively appraised and that I do not always take the word of my officials; I ask to see the underlying data and business case, and I shall continue to do so.

[Mr Don Foster (Bath) (LD)]

The Bath transportation package is now in the development grouping. Some aspects of the scheme are unacceptable to many people, including me, but I stress to the Secretary of State that modest Government support would deliver in Bath £2.5 billion of public investment, the largest brownfield development site outside London, 7,000 new jobs and 2,500 new homes. When he is judging what constitutes the best case for success, will he assure me that he will include the potential for economic growth?

[Mr Hammond]

Indeed I can. As I made clear in my statement, potential for economic growth is one of the key priorities in allocating funding. I am also aware that many schemes do not have 100% support for the currently proposed solution in the communities that they serve. Where there are ideas about how a scheme might be differently presented and how costs might be taken out in order to make a scheme more attractive and thus significantly more likely to secure funding, the Department will be interested to hear about them in the course of the process.

[Lilian Greenwood (Nottingham South) (Lab)]

The Secretary of State says that he wants to move to local decision making, but I can tell him that local people, local authorities, local MPs on both sides of the House and local businesses all want the A453 widening to go ahead, and we produced a dossier to him to explain why. Does he accept that his decision to shelve the scheme until at least 2015 will be a kick in the teeth for our regional economy, local businesses and the job creation we so clearly need?

[Mr Hammond]

Dear, dear! I must be going deaf, because I did not hear the hon. Lady mention the Nottingham tramway or the ring-road improvement. Far from being a kick in the teeth for Nottingham, this very carefully made decision prioritises the projects with the highest value for money. Whether she likes it or not, the ring road showed a much higher return per pound of taxpayers’ money—

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

Rubbish!

[Mr Hammond]

The hon. Gentleman says that, but it runs through his constituency; there is no pleasing some people. The ring road showed a much higher return per pound of taxpayers’ money spent than did the A453 scheme. However, the A453 scheme is in the development pool and we will continue to work on it. As the hon. Lady will know, the scheme has some powerful advocates who regularly make the case for it to me.

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

I applaud the criteria by which the Secretary of State has chosen to decide which projects should go ahead, but on the basis of sustainability, affordability, economic growth, cutting congestion and, I add, road safety, for what reason has the A1 Leeming to Barton project been cancelled? It was widely expected that it would go ahead to increase road safety, reduce road deaths and increase economic growth, and it is a major national road artery.

[Mr Hammond]

Decisions on the cancellation of Highways Agency schemes were made after very careful analysis of the business cases and a realistic appraisal of the likely envelope of funding not only in this spending review period but in the next one and the one beyond. It would be very easy to stand here and say that nothing is cancelled, but I do not want to encourage further spending on schemes that have no realistic prospect of going forward within the next 10 years, as that money could be spent on live schemes and getting work done rather than on people sitting in Highways Agency offices designing and redesigning schemes that will never happen. We have had to take some tough decisions, but I am quite confident that we have taken the right ones.

[Simon Danczuk (Rochdale) (Lab)]

Rochdale interchange, which is more commonly known, in Rochdale at least, as Rochdale bus station, is still in the amber list of schemes. The Secretary of State will be aware that it has cross-party support across Rochdale, but is he aware of its importance to the redevelopment of Rochdale town centre?

[Mr Hammond]

I am aware of the importance that the local authority and local people attach to the scheme. I am sure that in defining it as Rochdale interchange they were seeking to talk up its importance. Might I suggest that they call it Rochdale international interchange to raise its game a little further?

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

As the Secretary of State has already recognised that the A1 is a road of national strategic importance and as the design work to dual two of its worst sections has already been done, can that scheme be brought forward in one of the future spending rounds?

[Mr Hammond]

I am afraid that that scheme is some way off at the moment. At a point in the future that we will define in due course we will reopen the programme entry system so that new proposals can be made by local authorities or by the Highways Agency for future consideration, but I repeat that I do not want to have hundreds of schemes with thousands of civil servants working on them and no realistic prospect of getting on site.

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

The Sunderland strategic transport corridor, which includes the new bridge over the River Wear, will be crucial in bringing jobs to Sunderland and securing the economic regeneration of the region. What reassurance can the Secretary of State offer to the people of Sunderland that those important factors will be considered given that he accepts that the scheme offers value for money?

[Mr Hammond]

I can give the hon. Lady the assurance that the factors she mentions are indeed taken into account in the model. As I hope I made clear this afternoon, the whole aim of the Government in focusing on supporting infrastructure investment, and particularly transport investment, at a time when public expenditure is under extreme pressure, is to use transport infrastructure investment as a way of stimulating economic development and of coaxing it into areas that most need it. I recognise Sunderland’s claim, but as the hon. Lady will understand, this project is one of many in the development pool, so applicants will have to sharpen their pencil, think through their scheme and put their best proposal forward; then we will make a decision.

[Mr Mark Spencer (Sherwood) (Con)]

I congratulate the Secretary of State on his successful negotiations with the Treasury, and I welcome the fact that both Mansfield bus station and the Hucknall town centre improvement scheme are in the development pool. What criteria will the Secretary of State and his Department use to distinguish those schemes in the development pool that will move forward from those that will not?

[Mr Hammond]

The Department uses a set of criteria wider than simply measuring the benefit-cost ratios—monetisable benefits currently add up to exactly 50% of the weight in the multi-criteria analysis that we perform. We also look at wider network benefits, regional balance, the impact on economic development over a wide area, and landscape impacts and wider environmental benefits and disbenefits, so it is quite a wide-ranging scheme. Details are available on the Department for Transport website.

[Derek Twigg (Halton) (Lab)]

My question is on the funding of the Mersey Gateway between Runcorn and Widnes. It would be useful if the Secretary of State said whether he has determined the planning application, because the project depends on that as well, but my specific question is about the fact that he said in the statement that funding would be agreed in January. Does that mean that Halton borough council will be given funding to start work before 2015, and what savings is he looking for? A crucial element of this is tolls, which clearly must be at an acceptable level. We must remember that the current bridge is untolled and is a local road, so there is no scope for further income from tolls. There must be support from the Government through the funding arrangements.

[Mr Hammond]

I welcome the hon. Gentleman’s comments. I have followed the scheme with particularly close interest, because it is a very innovative proposal by a local authority. It is a very big scheme for a local authority to propose, and it proposes to toll an existing road—never an easy thing to do in terms of local public opinion, so I commend it for being prepared to take difficult decisions. But with all the schemes that we have said today we will support, it is only appropriate that we sit down with local authorities, go through the numbers, go through the specifications and see whether there is any more cost to be driven out. Some schemes are sitting in the Department’s books with an estimate of costs that was made in 2007. A lot has changed in the contracting market since then, and we want to ensure that right the way down the supply chain everyone is feeling the pressure that we are feeling as public spending is constrained—that we get the very best value for every pound of taxpayers’ money. We will work with the local authority to ensure that that is the case.

[Jackie Doyle-Price (Thurrock) (Con)]

The decision to postpone the work on junction 30 will be met with much dismay by my constituents in Thurrock, whose road network is very regularly clogged up by congestion caused by junction 30. It is also a major cause of disruption for users of the Dartford crossing. In view of that, does my right hon. Friend really think it fair to be considering increasing charges for the Dartford crossing?

[Mr Hammond]

Yes. My right hon. Friend is referring to junction 30 of the M25, a scheme that we cannot envisage being able to finance during the current spending review period but on which we will continue to do work with a view to development in future spending review periods. She will be aware of the interface with the proposals for the port development being progressed by Dubai Ports World, whereby funding contributions may be available to support some of the junction 30 improvement at some point in the future, depending on the progress of the port development. So the position with that project is slightly more complex.

[Mrs Jenny Chapman (Darlington) (Lab)]

I am pleased to hear Government Members, particularly the right hon. Member for Berwick-upon-Tweed (Sir Alan Beith) and the hon. Member for Thirsk and Malton (Miss McIntosh), arguing in favour of the upgrading of the A1 north of Leeming. It is a crucial link for economic development in the north-east, and my constituents can conclude only that the Government looked at the link and decided that the north-east just is not worth it.

[Mr Hammond]

The announcements made both today and last week by my right hon. Friend the Chancellor have contained significant investments in the north-east, but I have to tell the hon. Lady that we consider all these schemes objectively. From memory, I think that the A1 Leeming to Barton scheme had a benefit-cost ratio of less than two, and it is not a scheme that we can envisage being able to fund in the current circumstances during this spending review.

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

My constituents will warmly welcome the planned improvements to the M25 between junctions 23 and 27, which will play a significant part in our regeneration plans along the eastern corridor. Will my right hon. Friend also consider taking representations both from the local authority and me, as we are keen, with an eye to the future, to see the northern gateway access road, which will additionally provide greater infrastructure for our growing needs?

[Mr Hammond]

I hope that my office told my hon. Friend that I visited the M25, including junctions 23 to 27, this morning, and jolly wet, windy and congested it was, so I am sure that the scheme will be most welcome. I am not aware that we have received a funding bid for the northern gateway scheme. As I said earlier, speculative schemes that are not already in the system will now have to wait until we announce a further round of bidding, and then there will be an opportunity to bid for further schemes in future spending review periods.

[Mr Stephen Hepburn (Jarrow) (Lab)]

I am sure that the Secretary of State will understand my disappointment that the junction schemes on both sides of the Tyne tunnel have been shelved for the time being. Those junctions are important. The Tyne tunnel is in the process of being dualled, which will encourage substantially more traffic in the area, and the junctions are needed to keep the traffic flowing. Will he meet me and my hon. Friend the Member for North Tyneside (Mrs Glindon), whose constituency is also affected by the increase in traffic, so that we can discuss these issues?

[Mr Hammond]

I am happy to receive a representation from the hon. Gentleman. Of course, the promoting local authority must be the primary conduit for contact with the Department, but if he wants to meet me, I am happy to talk to him.

[Stephen Williams (Bristol West) (LD)]

I welcome the fact that value for money is being confirmed for the Bristol bus rapid transit scheme from Ashton Vale, which is in your constituency, Madam Deputy Speaker, to Bristol Temple Meads, which is in mine. However, following what the Secretary of State said earlier about localism, will he agree to look favourably on local authorities such as Bristol that wish to introduce a levy on workplace parking in the future, so that money raised locally can be matched with the limited resources that are now available nationally?

[Mr Hammond]

Where local authorities wish to impose workplace parking levies, they need the Secretary of State’s approval under current legislation. It is, of course, up to local authorities to promote such schemes if they feel that they are appropriate for their areas, but I have said recently that I would expect any further schemes proposed to me to demonstrate that they have properly and effectively consulted local businesses and addressed any proper concerns raised by local businesses during those consultations. So perhaps my hon. Friend can feed that back to Bristol city council.

[Rachel Reeves (Leeds West) (Lab)]

The Leeds rail growth package included a new railway station at Kirkstall Forge. Half of the money was to come from the private sector and would have facilitated private sector housing and business development, bringing hundreds of jobs and homes to one of the most deprived parts of the city. Why has the scheme, which the right hon. Gentleman says is good value for money, been sent back to the drawing board, with devastating prospects for jobs and homes in my constituency?

[Mr Hammond]

Dear, dear, it must be my ears again. I did not hear the hon. Lady mention the Leeds station southern access scheme, which has been approved—[Interruption] If I may say so to the hon. Lady, when one’s constituency is in a city, I think one will find that the effects of transport infrastructure improvement are a little wider than the narrow boundaries of a single constituency. Leeds station southern access scheme has been approved, and two further Leeds schemes, the Leeds rail growth package and the Leeds new generation transport scheme, have been included in the development pool, where we will work with the local authority to look at how we can ensure value for money and get the schemes into the best and most competitive form that they can be, after which we will make a decision on the allocation of the scarce capital that is available. I want to remind the hon. Lady one more time that the transport capital budget has been reduced by 11% for the next four years. The Government formed by her party before the last general election proposed to reduce capital spending by 50%.

[Julian Sturdy (York Outer) (Con)]

I thank the Secretary of State for the improvement that he has made to fairer transport funding for my region, Yorkshire and Humber. May I ask him about the time scales for best and final funding bids for the schemes in the development pool? Will he look closely at the Access York park and ride bid, which will be crucial to the local economy?

[Mr Hammond]

Access to York park and ride is included in that group of schemes. As I announced earlier, we intend to take decisions on which of those schemes will be funded by the end of 2011. We will work proactively with the local authorities sponsoring those schemes from now, and we will make decisions as we are able to do so, not necessarily in a single announcement at the end of 2011. It may be possible to announce some conclusions earlier than that.

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

To try to take the positives out of the statement, I welcome the go-ahead for Sheffield’s PFI highway maintenance scheme and the amber light for the additional vehicles for Supertram. I understand that the passenger transport executive has proposed that the scheme should go hand in hand with the tram-train trial, as there will be cost savings from purchasing the vehicles together. That scheme is not mentioned in the statement. It could utilise under-used rail lines, get vehicles into the heart of the city and act as a pilot for the rest of the country. Will that scheme go ahead as well?

[Mr Hammond]

I understand that my ministerial colleagues are aware of the scheme to which the hon. Gentleman refers and are actively looking at it, but it is the Supertram additional vehicles scheme that has been included in the development pool. If it is clear that there are synergies from linking this scheme to another scheme, it makes sense to examine that. I want to be pragmatic. If we can save money, I would certainly like to look at the opportunities to do so.

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

Although I am delighted to see that so many schemes have been approved for Devon, I know that my constituents and those in Totnes and Torbay will be disappointed that the Kingskerswell bypass is only in the pre-qualification pool, because the value for money is not clear. Will the Minister meet me and representatives of the other two constituencies and Devon county council to go through the criteria that the Treasury and the Department for Transport have set out, so that we can understand why value for money is not clear and make the right representations?

[Mr Hammond]

My hon. Friend might have slightly misunderstood the pre-qualification pool. It is not that the Kingskerswell bypass does not meet the value for money criteria; it is that the Department does not have an up-to-date appraisal of the scheme. It will therefore now carry out a rapid assessment in which value for money will be one of the primary considerations. There will be opportunities for her local authority to engage with officials in the Department—I am sure they are already engaged. I know that she has had discussions already with my the Under-Secretary, my hon. Friend the Member for Lewes (Norman Baker), and I am sure he would be happy to have further discussions with her.

[Alex Cunningham (Stockton North) (Lab)]

The cuts mean dark days ahead for the north-east, and they will be even darker now, with the decision to axe the Durham and Stockton street lighting PFI scheme, which would have made our streets lighter, brighter and safer. Why is the north-east and my constituency, which has already lost its new hospital and Building Schools for the Future programme, in the Government’s sights for yet another major cut?

[Mr Hammond]

We have confirmed the massive funding for the Nexus metro upgrade. The issue is not about cuts, but about investing where the best value for money can be delivered, and the Tees Valley bus scheme will be accelerated to provide additional and early support to the towns in the Tees valley. The PFI scheme to which the hon. Gentleman refers is simply no longer affordable. These PFI schemes, as he will know, are very expensive and would involve the Department committing for 30 years to a significant revenue stream, which it is just not sensible and prudent in the current environment.

[Stuart Andrew (Pudsey) (Con)]

I thank my right hon. Friend for the statement and, particularly, for his investment in the southern access to Leeds station, which will help to regenerate the southern part of the city. When he assesses the trolley bus system, will he look at the fact that, when it comes to an integrated transport system, Leeds has been led down the garden path for the past 20 years? I ask him to give significant consideration to that, because once people get into Leeds we need to get them around the city.

Secondly, I support some of the comments that the hon. Member for Leeds West (Rachel Reeves) made—perhaps not in the same way as I would have—with regard to the Kirkstall Forge and Apperley Bridge project, which would not only release significant amounts of private investment, but help to relieve significant congestion in some of the busiest parts of the city.

[Mr Hammond]

Both schemes to which my hon. Friend refers are in the development pool, and I urge him to urge his local authority to engage very seriously with that process, to sharpen the pencil, to think innovatively and to come back with a funding bid that puts those schemes in the vanguard and ensures that they are funded when we appraise the bids

[Bill Esterson (Sefton Central) (Lab)]

I welcome the news that the Thornton to Switch Island relief road will be funded, but will the Minister clarify what he means by revised funding bids from local authorities? Sefton council has already put almost £6 million towards the project and is “maxed” up to the limit, so to speak, so it is difficult to see how it could find further funds. However, in response to an earlier question the Minister said that money might be released from savings elsewhere. Could that money be used to reduce Sefton’s overall bill? Does he see it going up or down?

[Mr Hammond]

I can safely say that any local authority that comes back with a revised bid offering less local contribution is unlikely to be looked upon favourably. The Thornton to Switch Island link is a very high value scheme, delivering staggeringly high benefits for every unit of cost, but even so it is right that we sit down with the local authority and look at the cost estimates. As I said a few moments ago, some were done at a time when the contracting market for construction works was much firmer than it is now, and we must ensure that every opportunity to drive out cost and drive up value for the taxpayer has been taken. That is what the process will be. It will not take very long, because we expect to be able to undertake the work over the next couple of months and to confirm funding in January.

[Several hon. Members]

rose—

[Madam Deputy Speaker (Dawn Primarolo)]

Order. We have taken 30 Members’ contributions so far, and the statement is running rather longer than it should. I really would try to persuade Members to ask very short questions, because then we will get everybody in. I shall not call anybody who came in after the statement was given.

[Mr Marcus Jones (Nuneaton) (Con)]

I welcome the statement and the Government’s commitment to invest in our transport infrastructure. In doing so, I should like to be a little parochial, however, and mention the Coventry-Nuneaton rail upgrade, which will be extremely important in opening up further job opportunities for my constituents in Nuneaton, many of whom depend on Coventry for their employment. Is the Secretary of State willing to meet me to discuss that vital project, along with officials from Warwickshire county council?

[Mr Hammond]

That is the third representation that we have had on the Coventry-Nuneaton rail upgrade this afternoon. I would be very happy to meet my hon. Friend, and may I tempt him to include Opposition Members who have an interest in this? He and they are welcome to come along and talk about it.

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

Does the Minister understand the concern that he will cause in Luton and the surrounding areas by his shelving of the A5-M1 link road to the north of Luton, which is vital not only for improving transport but for solving our housing problems? Those housing problems will be even more acute in the coming years because of the coalition’s policies, which will force London residents out to places such as Luton.

[Mr Hammond]

The A5-M1 link road has not been shelved: it is a scheme on which we will do further development work. From memory, the issue involves the possibility of a significant developer contribution and the building of the road will open up significant amounts of developable land. We will need to do some further work to ensure that we extract the maximum possible developer contribution and that the public purse is not left to pick up a cost that should properly be borne by the private sector.

[Mr Mike Hancock (Portsmouth South) (LD)]

May I declare an interest as a member of Portsmouth city council? I thank the Secretary of State for his statement and commend to him the scheme for the Tipner interchange, which is in the pre-qualification pool. This scheme already has planning permission and is up and ready to go. It would generate thousands of jobs and create up to 2,500 homes. May I ask for the rapid transportation of that scheme from the qualification pool to the development pool in January, so that we can have a decision in the middle of next year?

[Mr Hammond]

If the fundamentals of the scheme justify its promotion to the development pool, it will be so promoted.

[Mrs Mary Glindon (North Tyneside) (Lab)]

I thank the Minister for agreeing to meet my hon. Friend the Member for Jarrow (Mr Hepburn) and me, and I welcome the upgrade of the Tyne and Wear metro, but people need jobs to travel to. The A19 corridor is crucial to the north-east’s economic development. Given the importance of the tunnel opening in 2011 and the two junctions on either side being improved, will the Minister increase the size of the meeting to include some business people and councillors who will also be able to make that case ably?

[Mr Hammond]

I am always happy to hear from the business lobby and the most convincing arguments often come from members of the business community. The hon. Lady makes the case that investment in transport infrastructure is good for economic development, job creation and inward investment. We know all that; the problem is that we have to prioritise the capital funding that we have available. The only fair way to do that is to look at the value for money that different schemes return for taxpayers’ funding and ensure that we prioritise them accordingly.

[Robert Halfon (Harlow) (Con)]

Harlow commuters will welcome the expansion of the M25 up to the M11, but the Minister will be aware of my Westminster Hall debate earlier this year in which I called for an extra M11 junction, which our town desperately needs. It would cost up to £25 million, and Essex county council is undertaking a £500,000 study of that project. What hope can he give my hard-pressed commuters that that scheme will be considered in the future?

[Mr Hammond]

I commend my hon. Friend for his tenacity. I know that he campaigned on this issue for many years before he arrived in this place, and he will no doubt continue to campaign on it for many years to come. The scheme is not currently on the list that I have published today and, as I have said to other hon. Members, it will be some time before we open the list to additional bids for future spending review periods. I do not want to encourage local authorities to spend significant sums of taxpayers’ money on schemes that I know we will not be able to fund in the foreseeable future.

[Phil Wilson (Sedgefield) (Lab)]

On “Question Time” last week, the Secretary of State raised expectations in the north-east on the Intercity Express programme and the potential for the building of a factory by Hitachi in Newton Aycliffe in my constituency. How long will we have to wait for a decision on that? It has raised expectations in the area, but will we get a response before Christmas?

[Mr Hammond]

I hope so. I said at the beginning of my statement, but perhaps I was being obtuse, that other major rail projects are under consideration, and I hope to be able to make an announcement to the House in the next few weeks. The Intercity Express programme is one of those under consideration. As the hon. Gentleman will know, it is an extremely complex package of projects, and the new bid that we have received from Agility Trains requires careful analysis at a technical, financial and legal level. That work is ongoing, and once we have completed it, I will be in a position to make an announcement.

[Dr Sarah Wollaston (Totnes) (Con)]

The Kingskerswell bypass in my constituency has been tantalisingly close to approval for half a century, which must be a record. I am grateful to the Secretary of State for agreeing to meet a delegation from Devon and Torbay councils, because the scheme is vital to regeneration for three constituencies. What further evidence should they bring to that meeting to press their case?

[Mr Hammond]

As I hope I have made clear, the process for the appraisal of projects is pretty rigorous, and will be based on the cost-benefit analysis and the external non-monetiseable effects of the scheme. If my hon. Friend looks on the Department for Transport’s website, she will find chapter and verse on how we do it. Of course I will always be happy to talk to hon. Members about their schemes, but I can assure her that the process for appraising schemes in the pre-qualification pool will be done rapidly and objectively, and the best schemes will move up into the development pool for consideration for funding next year.

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

Will the Secretary of State now publish the assessment to which he alluded earlier of the A453 in Nottinghamshire, which he suggested was on a lower value-for-money assessment? That is certainly not the feeling of Members on both sides of the Chamber. Although it might have the hallmarks of a country lane, it is a massive priority for businesses in the east midlands, and he is leaving them with the impression that he has no plans for jobs or growth.

[Mr Hammond]

I do not think that is the impression that businesses in Nottinghamshire will have been left with. I know the A453 very well, and I am well aware of the problems that occur in the area. The Under-Secretary of State for Transport, my hon. Friend the Member for Hemel Hempstead (Mike Penning), who has responsibility for roads, has already made a commitment to the House that we will in due course publish the business cases for both successful and unsuccessful schemes, so that Members can understand exactly how we have arrived at our conclusions.

[Several hon. Members]

rose—

[Madam Deputy Speaker]

Order. I will take the last five Members, because they have been waiting very patiently, but I ask them and the Secretary of State in reply please to be very brief.

[Eric Ollerenshaw (Lancaster and Fleetwood) (Con)]

I want quickly to congratulate the Secretary of State on how much he has achieved for transport in these straitened economic times. In particular, I welcome his commitment to the Heysham port to M6 link road, which I assure him has the full support of Lancashire county council and Lancaster district chamber of commerce. Will he assure me that his Department will be as proactive as possible to ensure that we see a completion date for this scheme, which has been on the table for the past 30 years?

[Mr Hammond]

Yes.

[Madam Deputy Speaker]

Thank you, Secretary of State. I call David Rutley.

[David Rutley (Macclesfield) (Con)]

What view has my right hon. Friend’s Department formed of the long-term prospects of the south-east Manchester multi-modal strategy, the A6 to Manchester airport relief road? Will he set out what steps he will be taking to review the relative merits of that scheme?

[Mr Hammond]

My ministerial colleagues are telling me—there are a lot of schemes to file in our minds—that this was going to be a private finance initiative scheme. However, PFI funding will no longer be available in the way it was, so if the scheme is to go forward, it will need to be resubmitted for conventional funding.

[David Mowat (Warrington South) (Con)]

Like Members on both sides of the House, I am delighted that the Secretary of State has found the money for the Mersey Gateway. However, the fact that it will be tolled—it has not been historically—will divert large amounts of traffic through inter alia my constituency. The level of traffic that will be diverted is sensitive to the toll set. Will he assure us that his Department will do what it can to ensure that the toll is not used to raise additional money over and above that needed to construct the bridge, and is not increased as part—

[Madam Deputy Speaker]

Order. Thank you very much. Will the Member please resume his seat? I think the Secretary of State got the gist of his question. It was not brief though.

[Mr Hammond]

I understand my hon. Friend’s concerns. This issue must of course primarily be a matter for the promoter of the scheme, which is Halton borough council. However, I am not sure that the local authority is totally unconstrained in setting a charge for the bridge, which will have to be related to the costs of delivering the scheme, so I will check that and write to my hon. Friend.

[Martin Vickers (Cleethorpes) (Con)]

It is disappointing that the two schemes affecting the port of Immingham will not proceed in the immediate future. Can the Secretary of State give me an assurance that if the south Humber gateway project, which was granted planning permission only two weeks ago, proceeds more quickly than anticipated, he will seriously consider bringing forward the A160 upgrade?

[Mr Hammond]

At least one of the schemes to which my hon. Friend refers is in the development pool. We will continue, as I hope he will, to work with his local authority to sharpen the bid and ensure that the scheme is viable for funding when we look at such matters in 2011.

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

One of the projects that is currently in the pre-qualification pool is the Camborne and Redruth transport package, which would unlock the potential for regeneration and create 6,000 new jobs. Can the Secretary of State give an assurance that those projects that have today been announced as being in the pre-qualification pool will not be disadvantaged by joining the development pool at a later date, should that happen?

[Mr Hammond]

Yes I can give my hon. Friend that assurance. The intention is to carry out the pre-qualification assessment over the next three months, with a view to some schemes moving from the pre-qualification pool to the development pool in January 2011. That will give them plenty of time to make their case for funding before the end of 2011, when the decisions are taken.

[Madam Deputy Speaker]

Thank you. That was 43 Members contributing, but it would have been easier if they had all been brief.

Points of Order

Tuesday 26th October 2010 Commons Chamber

17:11

[Clive Efford (Eltham) (Lab)]

On a point of order, Madam Deputy Speaker. I do not expect an answer to this point of order today, but I wonder whether you can seek clarification through Mr Speaker regarding the release of Government statements to the Liberal Democrats prior to their being made in the House. Members on the Liberal Democrat Benches have no higher status than Back Benchers on the Opposition Benches. The last time I looked, the hon. Member for Lewes (Norman Baker) was the transport spokesman for the Liberal Democrats, and he is now sitting on the Government Benches as the Under-Secretary of State for Transport. I would like to know whether what has happened is common practice. Has it happened before, exactly what can we expect in the future, and will Mr Speaker look into it?

[Madam Deputy Speaker (Dawn Primarolo)]

That is not really a point of order for me in the Chair. However, the hon. Gentleman has got his point on the record, and I understand that the Secretary of State wants to be helpful to him.

[The Secretary of State for Transport (Mr Philip Hammond)]

I, too, heard a reference to a copy of my statement having been received by one of my hon. Friends. I suspect that they were referring to the list, which was placed in the Vote Office a few moments before. As far as I am aware, no copies of the statement were distributed before I rose to speak.

[Madam Deputy Speaker]

Well, this is a matter that Mr Speaker can look at, and he can read the comments that have been made on the record. I do not know the answer at the present time, but I am grateful to the hon. Member for Eltham (Clive Efford) for bringing the matter to my attention.

I call Bob Ainsworth.

[Mr Bob Ainsworth (Coventry North East) (Lab)]

Further to that point of order, Madam Deputy Speaker. I would ask that the Speaker look into this—

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

Did you call me or my right hon. Friend, Madam Deputy Speaker?

[Madam Deputy Speaker]

I called Bob Ainsworth.

[Mr Ainsworth]

I would ask that the Speaker look into this matter. It became pretty apparent that Back Benchers were not being treated equally. There are, it seems, pretend, shadow Liberal Democrat Ministers in the House, but they should surely not be given privileges over other Back Benchers. I would have thought that it was a matter for the Speaker to see whether Members were being treated with some kind of fairness and equality.

[Madam Deputy Speaker]

I have given my answer in response to that point of order. The Secretary of State has been helpful by pointing out that, as far as he is concerned, what the right hon. Gentleman has described should not have happened, and there are no special arrangements. Mr Speaker will be able to look at the points that have been raised and decide whether this is a matter that he needs to address. I think that that is all that we can deal with at this point.

[Sir Gerald Kaufman]

On a point of order, Madam Deputy Speaker. I want to raise a matter that relates to the rights of hon. Members of this House. Thursday next week will be the 15th anniversary of the assassination of Yitzhak Rabin, the Prime Minister of Israel. I sought to table an early-day motion commemorating the event, and took it to the Table Office. Its heading was “Yitzhak Rabin, Assassinated Peacemaker”. That he was assassinated is incontrovertible, as his murderer is serving a prison sentence for killing him. That he was a peacemaker is incontrovertible as he was awarded the Nobel peace prize the year before he was assassinated. Yet the Table Office sought to get me to remove the words “Assassinated Peacemaker” from the title and, when I demurred, said that it would need to be discussed. I heard nothing further from the Table Office and, that being so, assumed that the early-day motion would be on the Order Paper today. It was not. When I inquired about it, I was told that nothing whatever had been done about it. I have studied “Erskine May”, and there is nothing whatever in it that gives the Table Office the power to amend or change the title of an early-day motion in that way. The rights of hon. Members are at stake, because if we cannot say what is true and incontrovertible in an early-day motion without it being liable to being amended, then where are we, Madam Deputy Speaker? I seek to be allowed to table my early-day motion, with its title, in the way that I drafted it.

[Madam Deputy Speaker]

I am grateful that the right hon. Gentleman has raised this point of order with me. I am not able to respond immediately, but I hope that he will agree that I can look into the matter—it might be a matter that Mr Speaker will want to consider directly—and that we come back to him as quickly as possible.

[Sir Gerald Kaufman]

Further to that point of order, Madam Deputy Speaker. I thank you for that, but when you say “as quickly as possible”, how quickly is that? The Table Office did not come back to me at all. The anniversary is next week, and the motion has already been delayed. It is not a matter of amour propre on my part that the House of Commons can commemorate the assassination of a great man.

[Madam Deputy Speaker]

I have given the right hon. Gentleman my word that I will look into the matter. I am currently on duty in the Chair, and will remain here for a little longer. As soon as I leave the Chair, I will start inquiring into the points that he has made and get back to him as quickly as I possibly can. Perhaps we can now move on, as we have a ten-minute rule Bill.

Parliament (Amendment)

Tuesday 26th October 2010 Commons Chamber

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

17:17

[Mr Christopher Chope (Christchurch) (Con)]

I beg to move,

That leave be given to bring in a Bill to make further provision to limit the size of the legislature by ensuring that the number of peers entitled to vote in the House of Lords does not exceed the number of parliamentary constituencies; to introduce a statutory limit on the number of Ministers, Whips and Parliamentary Private Secretaries in each House of Parliament; and to set a maximum proportion of Ministers, Whips and Parliamentary Private Secretaries in the total membership of each House of Parliament.

The Bill follows on from our debate in the House yesterday evening on the new clause that was so ably proposed by my hon. Friend the Member for Broxbourne (Mr Walker) during our deliberations on the Parliamentary Voting System and Constituencies Bill. I do not know whether you were able to follow it, Madam Deputy Speaker, but it was a vintage debate, in which my hon. Friend was supported by the Father of the House, my hon. Friend the Member for Louth and Horncastle (Sir Peter Tapsell), as well as my hon. Friends the Members for Richmond Park (Zac Goldsmith) and for Harwich and North Essex (Mr Jenkin) and many others.

My hon. Friend the Member for Broxbourne made the case for constraining the size of the Executive as a proportion of the membership of the House. For example, he said that if the number of MPs was reduced to 600, the maximum number of Ministers should be reduced from the present maximum of 95 to 87. He also said that that was hardly the most radical proposal. He and I both expected a lot more support from our own side in the Lobby, and I am sure that there would have been, had there been a free vote, or indeed anything other than a strong three-line Whip. I know that one of my hon. Friends who supported the new clause was seen being dragged away to the Whips Office to be dealt with. That is part of the background to this Bill.

In what is generally agreed to have been one of the lamest responses from the Front Bench in years, the Parliamentary Secretary, Office of the Leader of the House of Commons, the hon. Member for Somerton and Frome (Mr Heath), was reduced to expressing sympathy to my hon. Friend the Member for Broxbourne, while arguing a case for prematurity. Those of us who have been Members of this House for some time know that when all other arguments have failed, the argument of prematurity is the last desperate throw.

In yesterday’s debate, my hon. Friend the Member for Richmond Park quoted what the Prime Minister had said in February this year when he was the Leader of the Opposition:

“We’d want to reduce the power of the executive and increase the power of Parliament even if politics hadn’t fallen into disrepute.”

My hon. Friend argued that the Government should do what the present Prime Minister promised to do in advance of the general election. He also quoted the Deputy Prime Minister and other leading figures in the Government.

Why, then, is it premature to reduce the power of the Executive? The only reason it is premature is that the Executive say that it is premature. I think that reducing the power of the Executive is long overdue and that the arguments that applied before the general election apply even more strongly now. When presented with their own self-proclaimed path of virtue, however, the coalition Government have not merely said “Not yet”, but made things worse by increasing the size of the Executive.

When I was first elected in 1983, 81 Members of Parliament were Ministers, of whom 13 were Whips. Today, 95 MPs are Ministers, of whom 17 are Whips. Even under the last Labour Government, only 90 MPs were Ministers, of whom 15 were Whips. What has happened in this Parliament is that the new Government have increased the number of Ministers and the number of Whips.

[Chris Ruane (Vale of Clwyd) (Lab)]

Will the hon. Gentleman give way?

[Mr Chope]

As I understand it, I am not able to give way during a ten-minute rule Bill. I am supposed to have 10 minutes, but I keep looking at the clock wondering how many minutes have expired—[Interruption.] Five minutes—

[Madam Deputy Speaker]

Order. The hon. Gentleman’s 10 minutes will be up at 5.27 pm.

[Mr Chope]

I am grateful, Madam Deputy Speaker. I am sure that a number of Members will not be able to reach that moment soon enough. [Hon. Members: “Hear, hear.”]

Let us be clear: Ministers come with a high price tag. Lord Turnbull told the Public Administration Select Committee earlier this year that the average cost of a Minister was £500,000 a year. That is not his salary, but the costs of the private secretary, the office and all the rest that goes with it. Despite being committed to making savage cuts in public expenditure, however, the Government are in denial of the increased costs that the Government have incurred by increasing the number of Ministers.

On 18 October, I asked the Minister for the Cabinet Office if he would

“estimate the annual cost to the public purse of the change in the number of Ministers and Whips drawn from the House of Commons since the dissolution of the previous Parliament.”—[Official Report, 18 October 2010; Vol. 516, c. 516W.]

I expected an answer along the lines of, “We reckon there are five extra Ministers, as a result of which, with each costing about £500,000, it works out at about £2.5 million”. In fact—this is on the record—my right hon. Friend did not answer the question at all. He avoided it completely and talked about how Ministers had taken a pay cut. That was not the question I put to him. I use that as evidence that even at the centre of this Government—in the Cabinet Office itself—they do not want to face up to the consequences of their own actions.

Another part of my Bill deals with the number of peers in the House of Lords: currently, there are 777. Since the general election, 56 new appointments have been made, and another 50 are proposed to be recruited imminently, with further additions proposed to comply with the coalition’s commitment to have the same proportion of Conservative and Liberal Democrat peers in the House of Lords as the proportion who voted for those parties in the general election. According to the maths that I have done on the back of an envelope, to get a proportion of 59% of the 777, an extra 186 peers would have to be appointed, bringing the total to 963. If there was no reduction in the number of Labour Members, to produce 59% of the higher figure of 963 we would have to produce the best part of another 100 peers. In the short term, therefore, it seems to be coalition Government policy to increase the number of Members of the House of Lords by no fewer than 250, which is absolute lunacy. Meanwhile, contrary to all the representations made by various Committees of the House, the number of Parliamentary Private Secretaries is 32 and rising. Over the years, many people have suggested that there should be no more than one PPS per Department, but the Government have ignored all that.

The Bill is a framework Bill. Similar Bills have been put before the House previously, and I go forward confident in the knowledge that my right hon. Friend the Member for Chingford and Woodford Green (Mr Duncan Smith), the hon. Member for Taunton Deane (Mr Browne) and Mr Speaker himself have argued a similar case to that which I advance today. I have 12 supporters for the Bill, and following last night’s debate I could have accommodated more, but the rules of the House prevent me from having more than 12. I am grateful to all my hon. Friends who have offered to support my Bill but who cannot be included in the 12 —the Bill will have many more supporters in due course.

Question put and agreed to.

Ordered,

That Mr Christopher Chope, Mr Graham Brady, Mr Richard Shepherd, Mrs Eleanor Laing, Mr Mark Field, Mr Andrew Turner, Mr Robert Syms, Martin Vickers, Mr Philip Hollobone, Graham Stringer, Tristram Hunt and Mr Charles Walker present the Bill.

Mr Christopher Chope accordingly presented the Bill.

Bill read the First time; to be read a Second time on Friday 4 March and to be printed (Bill 97).

Savings Accounts and Health in Pregnancy Grant Bill

Tuesday 26th October 2010 Commons Chamber

Second Reading

17:28

[The Financial Secretary to the Treasury (Mr Mark Hoban)]

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

The Bill does three things: it ends eligibility for child trust funds for children born from January 2011 onwards; it repeals the Saving Gateway Accounts Act 2009, following our decision not to introduce the saving gateway scheme; and it abolishes the health in pregnancy grant, again from January 2011. I will explain the detail of the measures shortly, but first I want to explain the rationale behind them, because they all have the same aim of helping to reduce Britain’s budget deficit.

As my right hon. Friend the Chancellor of the Exchequer set out clearly last week, the Government have inherited an exceptional fiscal challenge. Last year, we had the largest peacetime deficit in our history, and we were borrowing £1 in every £4 that we spent. We are now spending £120 million a day just to pay interest on our debt. As the Governor of the Bank of England said last month, that position is “clearly unsustainable”. Taking urgent action to tackle the budget deficit is clearly unavoidable.

[Sandra Osborne (Ayr, Carrick and Cumnock) (Lab)]

Can the Minister tell me why this coalition Government are so determined to pick on children?

[Mr Hoban]

In September 2009 Carl Emmerson, acting director of the Institute for Fiscal Studies, said:

“Abolishing the Child Trust Fund would make newborns worse off in eighteen years time. But spending cuts in other areas might leave them worse off.”

That is the challenge that the coalition Government face. This is the question that the hon. Lady should be asking: why did her right hon. and hon. Friends leave the country in such a mess that the present Government are required to take these measures?

Without healthy public finances, we cannot have sustainable growth in our economy. The consequence of failing to act now would be higher interest rates, business failures, rising unemployment and even, potentially, the end of the recovery. So we set out a clear plan, in the Budget statement in June and in the comprehensive spending review statement last week, to tackle the deficit. Last Wednesday the Chancellor set out more than £80 billion of spending reductions to help to deliver the Government’s fiscal consolidation plan, which will reduce borrowing by £11 billion per year by 2014-15. The International Monetary Fund has said that our plan

“greatly reduces the risk of a costly loss of confidence in fiscal sustainability and will help rebalance the economy.”

The Bill is part of that plan.

I realise that the changes made by the Bill will disappoint some Members and others outside the House. Indeed, when we were in opposition, the Conservative party supported the introduction of the policies that have been removed, although at the time we raised some questions about their effectiveness.

[Alison McGovern (Wirral South) (Lab)]

The Minister has talked about what happened in the past and about the actions of the last Labour Government. Will he tell us whether his party supported the recapitalisation of the banks that protected our financial services system, which led to the deficit?

[Mr Hoban]

Yes, we did support the recapitalisation of the banks, but I am not sure where the hon. Lady’s point is leading. The deficit is a consequence of the huge growth in spending under the last Government, and their failure to ensure that the fiscal position was sustainable.

This year, the child trust fund would have cost more than half a billion pounds, and that money would have been locked in for up to 18 years instead of supporting people now. That is a luxury that we simply cannot afford, given the fiscal challenge that we face. We also could not afford to introduce a new scheme like the saving gateway, which would have cost £300 million over the next five years, just as we started to tackle that challenge. Nor can we afford to continue to spend £150 million every year on giving cash payments to all pregnant women, whatever they spend the money on and whatever their incomes.

[Mr Andrew Love (Edmonton) (Lab/Co-op)]

Would not the Minister’s position have more credibility if he proposed ways in which he could encourage families to save? Such proposals were included in the Bills that he is about to abolish.

[Mr Hoban]

If the hon. Gentleman cares to stick around for a few minutes, he will learn something about what we are going to do for families in that regard. I believe that this Government will do more than the last Government in terms of long-term benefit to encourage families to save.

Taken together, the changes that we are making to child trust funds, the decision not to introduce the saving gateway, and the abolition of the health in pregnancy grant will save us £370 million in the current financial year, about £700 million next year, and about £800 million in each year from then on.

[Mr Love]

According to an excellent research brief provided by the House of Commons, the Government will save £450 million in future years in relation to the saving gateway. However, the Minister has just admitted that it has not been introduced. How is it possible to save £450 million on a scheme that has not been introduced?

[Mr Hoban]

Spending on that scheme was included in the spending score card by the last Government. We are not spending the money; therefore we are saving it.

If we had not found the savings where we have found them, we would have had to find them through other spending cuts, through tax rises or through higher borrowing, and that would have kept the deficit higher for longer. Those who oppose the Bill must tell us what they would cut instead.

Having explained the context of the Bill, I shall now describe its measures in more detail starting with the most straightforward element, which is clause 2. It repeals the Saving Gateway Accounts Act 2009. As Members may be aware, the saving gateway would have been a cash saving scheme for people on lower incomes based on matching—there would have been a Government contribution for each pound saved. The scheme was due to be introduced in July 2010; that is when the previous Government booked the spending from. I believe that people in Britain, including those on lower incomes, need to save more, and there was evidence from the saving gateway pilots that matching was a popular and easily understood incentive to save, but when we looked at the proposal ahead of the Budget, it was clear that this would have been exactly the wrong time to introduce a new scheme that would have cost us up to £115 million a year.

[Mr Jamie Reed (Copeland) (Lab)]

I was grateful for the support the hon. Gentleman’s party gave when in opposition to the then Labour Government’s efforts to reduce child poverty. What assessment has his Department made of the effect of the withdrawal of these grants and schemes on child poverty in this country, not just in general but by region and constituency?

[Mr Hoban]

There was clearly a choice. We could have continued with these schemes and cut spending elsewhere, but we decided that it was better to take action now to tackle the deficit than to put that decision off, as the hon. Gentleman’s party would do, and therefore have to make deeper cuts in the future. I think the steps we are taking are the right course of action to tackle the deficit.

Although the previous Government had agreed with RBS and Lloyds Banking Group that they would introduce saving gateway schemes, none of the other big high street banks were planning to do so, and although the Post Office was going to offer the accounts, that was only because the previous Government had agreed to pay it to enable it to do so. Also, while a number of credit unions were signed up, not a single building society signed up to provide the saving gateway account. Therefore, although I appreciate the engagement of those who had planned to offer saving gateway accounts, I was concerned that not everyone in the eligible population would have had an accessible provider. For these reasons, we announced at the Budget that the saving gateway would not be introduced. We therefore stopped the Saving Gateway Accounts Act from coming into force, and this Bill repeals it altogether. Although we may want to come back to this idea at some point in the future, we have no plans to do so at present so it would be wrong to leave this legislation on the statute book.

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

The Minister alluded to the fact that credit unions were particularly interested in supporting this initiative, and he will be aware that credit unions are particularly likely to be located in communities with high concentrations of disadvantage and poverty. Therefore, although he says the scheme’s reach was not complete, does he accept that in fact it was potentially rather well targeted?

[Mr Hoban]

That assumes that there is a credit union in every deprived community, but in some such communities a credit union may not be accessible, and the Post Office would have stepped in only if a Government subsidy were provided, so I do not believe there was going to be a complete network of saving gateway account providers to ensure that every eligible person in this country would have been able to access an account.

Clause 3 addresses the health in pregnancy grant. It is a one-off cash payment of £190 to pregnant women. The previous Government said it was being introduced in recognition of the importance of a healthy diet during pregnancy. However, the National Childbirth Trust said that

“the evidence indicates that, if dietary intervention is to have an impact on birth weight and outcomes for the baby in later life, it should be started as early as possible.”

Given that the grant is not paid until the third trimester, it is not clear how effective it is, and although—

[Several hon. Members]

rose—

[Mr Hoban]

Let me make some progress. Although the previous Government said the grant was intended to support the general health and well-being of women in the later stages of pregnancy, there is no requirement to use the grant for better health and well-being. Women can spend the money on whatever they want, and the grant also goes to pregnant women regardless of their income and their need for it.

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

It seems to me that that money was also for meeting the additional costs of having a baby. It was very much linked with women receiving advice from health practitioners too; there was a link between our making sure that women were getting the very best advice and their being able to access the money.

[Mr Hoban]

Well, other schemes are available to help women ensure that their diet is healthy. May I tell the hon. Lady what others have said about this one? Zoe Williams, writing in The Guardian in April 2009, said that this is

“a universal grant to mothers who may or may not need it, and may or may not spend it on vegetables that may or may not positively influence the health of their unborn children.”

[Interruption.] I am simply quoting from The Guardian—I did not realise just how much outrage that would cause in the House. Paul Waugh, writing in the London Evening Standard in June 2010, said:

“The Health in Pregnancy Grant is frequently not even spent on healthy food.”

[Interruption.]

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. Look, I understand that this is an important matter and it concerns everyone in the Chamber, but it is no good everyone trying to chunter at once. The Minister has been very generous in giving way so far and I am sure he will be generous in the future. One at a time please, rather than chuntering from across the Benches.

[Mr Hoban]

Mr Waugh continues:

“It is spent on absolutely anything the mother wants. A lot of middle class mums simply bung it towards a fancy new Bugaboo pram.”

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

Does the Minister know how much folic acid costs?

[Mr Hoban]

Clearly, if this grant was targeted at enabling women to buy folic acid, the argument would be different, but no strings are attached to this grant; money can be used in any way that people want.

[Mrs Sharon Hodgson (Washington and Sunderland West) (Lab)]

The Minister says that this grant has not always been spent on what it was intended for and instead has been spent on things such as buggies—they are equally important. Would it not have been advisable then to have targeted it, by using, for example, income-related benefits, so that it went to people who really needed it and was spent on what it was intended for?

[Mr Hoban]

Of course the hon. Lady should really address that to her colleagues who were Treasury Ministers when the grant was introduced, as they could have chosen to target it more closely. Other grants that are available are targeted at women in the early stages of pregnancy and the Sure Start maternity grant is in place.

[Mr Mark Field (Cities of London and Westminster) (Con)]

I accept the honourable way in which a number of Labour Members have stood up and are concerned, but does this not show that once we give any benefits they are taken for granted by whoever ends up receiving them? Does the Minister recognise, and will he confirm, that the Bill deals with only a small number of the grants that could be looked at by the Treasury? We have to get this deficit down and his opening comments have made a perfectly valid point. Will he confirm that he might well have examined a considerable number of other grants in this Bill, but it deals with only a small number?

[Mr Hoban]

My hon. Friend makes an important point. The Government have had to go through this challenging spending process with care, examining both spending and welfare decisions. We have had to take decisions that are not straightforward, not easy and not ones that we would have wanted to take, but we have had to do so because of the financial problem that we inherited from our predecessors.

Let me give another example of targeted support that is available, because the hon. Member for Washington and Sunderland West (Mrs Hodgson) talked about means-tested grants. I am sure that she will be aware of the Healthy Start scheme, which is a statutory scheme providing a nutritional safety net and encouragement for breastfeeding and healthy eating to more than 500,000 pregnant women and to children under the age of four in low-income and disadvantaged families across the UK. The scheme is tied carefully because, unlike the health in pregnancy grant, it provides vouchers for people to put towards the cost of milk, fresh fruit and vegetables, and infant formula milk at 30,000 retail outlets. So measures are in place to support the groups that she is most concerned about, and it is right that that is so. The health in pregnancy grant is unfocused and untargeted.

[Liz Kendall (Leicester West) (Lab)]

The Healthy Start scheme is a good, targeted one, but will the Minister admit that the Government are also restricting the Sure Start maternity grant, abolishing the baby element of the tax credit and not going ahead with the toddler tax credit? Pregnancy and the first year of life is vital for a child’s development; if we can give children the best start in life, it saves us all in the long run. So will he reconsider his abolition of these schemes?

[Mr Hoban]

Perhaps the hon. Lady would tell us what she would cut instead. It is very easy for the Opposition, who did not come forward with a plan to tackle the deficit before the last election. Now, every time a cut is proposed they oppose it. As was very clear from the leaked document in The Times today, they recognise themselves that their economic plan has no substance.

[Pete Wishart (Perth and North Perthshire) (SNP)]

There is no doubt whatsoever that the Labour party left the country’s finances in an appalling state, but why is the Conservative-led coalition taking it out on children and pregnant women?

[Mr Hoban]

If the hon. Gentleman looks at some of the analysis that was set out at the time of the Budget and last week’s spending review, he will see that we are taking action in both to ensure that child poverty does not deteriorate under this Government. For example, there are increases in child tax credits to families on particularly low incomes to deal with the issue of child poverty.

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

Does the Minister not agree that the clue as to the purpose of the health in pregnancy grant lies in its title? It was supposed to promote health in pregnancy. Does he agree that there is no evidential base to suggest that in the seventh week of pregnancy onwards it was providing that improvement in health?

[Mr Hoban]

My hon. Friend makes an important point. I would say that the challenge is as follows. Other schemes are in place to help families on low incomes to deal with some of the issues around childbirth. I have talked about the vouchers that are available to help with nutrition and we have the Sure Start maternity grant, too, which is designed to help low to middle-income working families and out-of-work families to cover the one-off costs associated with having a new baby. There are measures out there, but, yes, they are restricted. The Sure Start maternity grant will apply to the first child—it is a grant of up to £500—but, of course, the problem is that the previous Government left us with a huge debt that we need to tackle and to pay back. If we put off these decisions, as the hon. Friends of the hon. Member for Leicester West (Liz Kendall) would want us to, it would be the poor who would pay the most. It would be those children who would be saddled with the debt that the previous Government left hanging around their necks.

[Mr Mark Field]

I have a two-and-a-half-year-old son, so I have had the benefit of some of these universal benefits. I must say that in these straitened economic times it makes sense for things to be targeted in a much more effective way. That is all that we are trying to do, and it is regrettable to see the way in which the Minister is being harangued by Opposition Members. We should be targeting these benefits; they should not be universal. This is entirely the right way forward.

[Mr Hoban]

My hon. Friend makes an important point. We need to look very carefully at where money is spent and ensure that it is spent wisely in pursuit of improving the life chances of children and young people. That is why, for example, our right hon. Friend the Deputy Prime Minister announced recently that we will extend to all disadvantaged two-year-olds 15 hours of free nursery care. That is a very targeted way of helping children from the most disadvantaged backgrounds to achieve their life chances. We have seen the pupil premium introduced, with £2.5 billion a year to help children from disadvantaged families. The coalition Government have set out plenty of measures that are focused on helping the most vulnerable in society. That is what we need to do in the light of this financial crisis: to target measures on those who need them the most, rather than simply opposing every cut for the sake of it, as the Opposition are trying to do.

[Sheila Gilmore (Edinburgh East) (Lab)]

Does the Minister not agree that the logic of his position is that universal benefits should not exist? In that event, why are women and children being targeted for the loss of these universal benefits? Why not pensioners, who might not use their winter fuel allowance to pay their fuel bill? They might use it for something wholly inappropriate, such as buying a new pair of shoes or a piece of clothing. Why are women and children being targeted in this way?

[Mr Hoban]

The Labour party is clearly looking for more substance for its economic plan, and perhaps the hon. Lady’s idea of tackling the winter fuel payment is something that the shadow Chancellor will embrace. I look forward to hearing whether those on the Opposition Front Bench will decide to adopt her idea or dissociate themselves from it.

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

The Minister is turning to support for the most disadvantaged. If there is one area that should unite all parts of this House, it is the welfare of looked-after children, most of whom arrive in care with nothing and leave care with nothing. If there is any group that needs to build up an asset base, it is children in care, yet the Minister is taking away at a stroke the possibility of building up an asset base by getting rid of the child trust fund. How can he, as a Minister, possibly justify his Government’s claim that they are protecting the most vulnerable, when he is robbing children in care?

[Mr Hoban]

I am turning to child trust funds, and I take on board the right hon. Gentleman’s point. As one of the consequences of our decision to scrap the child trust fund, we are using some of the money that we have saved to provide respite care for disabled children. We have thought carefully about the issues, and, frankly, the decisions are not easy to take. Our decision to scrap the child trust fund is important. It will enable us to deliver the pupil premium and the £2.5 billion package, which was recently announced, to support children from disadvantaged backgrounds. The right hon. Gentleman should look at the issue in the round rather than cherry-picking particular policy areas.

[Toby Perkins (Chesterfield) (Lab)]

Will the Minister give way?

[Mr Hoban]

No; I will continue. I have given way quite a lot, and I want to make some progress. This is an important Bill, which is why I want to ensure that I have given Opposition Members the opportunity to intervene, but I want to continue setting out the case for why we need to take these measures to tackle the problem that the previous Government left behind.

We announced in May that Government payments to child trust funds would be cut in two stages—they will be reduced first and then stopped altogether. In July, we made regulations to take the first step. For those born from August this year, payments at birth were reduced from £250 to £50, or from £500 to £100 for children in lower-income families or children in care. Government payments at the age of seven also stopped completely from August. The regulations will end the additional payments made to disabled children from 2011-12 onwards, although, as I have said, we will recycle the money that we have saved on those payments to provide additional respite breaks.

Those regulations could not end eligibility for child trust funds altogether, because that process requires primary legislation. This Bill completes the process by ending eligibility for child trust funds for all children born from January 2011 onwards, which means that the remaining Government payments will stop altogether.

[Sandra Osborne]

Will the Minister give way on that point?

[Mr Hoban]

No; I want to make some more progress.

I realise that many people, including some hon. Members, will find these changes disappointing. As I have explained, however, the child trust fund is simply unaffordable given the deficit that we face and the need to focus our resources on supporting people now.

Although we need to reduce spending on the child trust fund, we remain committed to encouraging people to save. I want to see a saving system that is based on our principles of freedom, fairness and responsibility, as well as being affordable and effective.

[Mr Christopher Chope (Christchurch) (Con)]

I am with my hon. Friend 100% on the principle that he has just enunciated. Will he clarify the issue of encouraging people to save for their further and higher education? If they do so, they will apparently be penalised under the coalition Government’s proposals if they pay their fees upfront having done the right thing and saved for their education. Is that correct? If so, how is it consistent with what he has just said about our commitment to encouraging a savings culture?

[Mr Hoban]

My hon. Friend has made an interesting point. We want to encourage more young people to save and to give them some assets at the age of 18. I will look into his point and write to him.

As I have said, the saving gateway and the child trust fund are not affordable given the budget deficit that we inherited, so we are taking a different approach to encouraging saving that builds on the latest research on how to influence people’s behaviour.

The coalition agreement announced the roll-out of a free, impartial national financial advice service paid for by the financial services industry. The service will be fully rolled out by spring next year, providing information and advice on money matters and helping people to understand their options.

[Mrs Hodgson]

Will the Minister give way?

[Mr Hoban]

I will continue.

In the Budget, we announced that an annual financial health check will also be available from next spring as a component of the national financial advice service, offering everyone the chance regularly to review their financial situation and encouraging them to take action including through saving. Both the national financial advice service and the annual financial health check will help people to make the right decisions. We can also do that by making sure that the right products are available, including for families to save for their children.

To make sure that parents have a clear, simple and accessible option to save for their children, we will introduce a new, tax-free children’s savings account after the end of child trust fund eligibility. That account will not have any Government contributions, but it will allow families to build up some savings for their children.

[Mr Love]

Will the Minister give way on that point?

[Mr Hoban]

If the hon. Gentleman allows me to finish, I may well answer his question.

We are working on the details of the accounts with the industry and other stakeholders, and we will set out more detail in the months ahead. We are clear that, as with child trust funds, those accounts will belong to the child; that they will be locked in until the child reaches adulthood; that they will allow investment in both cash or stocks and shares; that they will be able to receive contributions from family, friends and others up to an annual limit; and that all returns will be free of income tax and capital gains tax.

[Mr Love]

The Minister has forgotten to mention that both the child trust fund and the saving gateway were specifically targeted at lower-income groups, many of whom—perhaps most of whom—do not pay tax. All the evidence suggests that in order to incentivise people, you have to either provide them with an asset or match their savings pound for pound.

[Mr Hoban]

As I have set out, the previous Government left us with no choice but to axe those schemes, because we had to save £80 billion in public spending to get spending back on track and keep the deficit under control and interest rates as low as possible for as long as possible. That was the Government’s priority.

[Toby Perkins]

Will the Minister give way?

[Mr Hoban]

I will not, because I want to continue making progress.

We want to provide people with a clear and simple way of saving for their children, while saving the £500 million a year that we currently spend on child trust funds.

The savings from the child trust fund, the saving gateway and the health in pregnancy grant will allow us to prioritise the limited resources that we have. As the Chancellor set out last week, we have chosen our priorities as we tackle the deficit that we inherited. We are delivering on our commitment that health spending will increase in real terms in each year of this Parliament. We are prioritising long-term growth, creating the conditions for a private sector-led recovery. We are also radically reforming public services to build the big society where everyone plays their part.

[Paul Goggins]

Will the Minister give way?

[Mr Hoban]

I am sorry, but I need to make progress.

We are prioritising fairness and social mobility, providing sustained routes out of poverty for the poorest. While encouraging some of the poorest to build up savings can be seen as meeting those goals, in the tight fiscal position that we have inherited, it is better to invest more in education and health, which will have a greater immediate impact than building up assets.

[Mrs Hodgson]

The Minister has mentioned education. The Government are introducing larger fees, so young people will leave university with up to £40,000 of debt. A small nest egg from the Government in the form of the child trust fund would have incentivised families to save to pay for that debt. Will he explain how those two concepts go hand in hand and where the fairness is?

[Mr Hoban]

The hon. Lady should have taken the opportunity to ask her colleagues that when they introduced tuition fees and the child trust fund in the previous Parliament. The situation is not new, and I am sure that she has discussed the matter with her colleagues.

[Paul Goggins]

rose—

[Mr Hoban]

As we tackle the deficit, one of our priorities is to transform the prospects of the poorest children.

[Paul Goggins]

Will the Minister give way?

[Mr Hoban]

I will not. The Opposition spokesman, the right hon. Member for Delyn (Mr Hanson), wants to speak in the debate and needs to be free from this place at 6.30 pm, so I will continue my speech.

[Paul Goggins]

rose—

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. Mr Goggins, you are going to have to sit down. The Minister is not giving way. I know that you are trying to catch his attention, but you cannot stand up for five minutes waving your hands. You have got to get used to being back on the Back Benches.

[Mr Hoban]

I was not sure whether he was waving or drowning, Mr Deputy Speaker.

As we tackle the deficit, one of our priorities is to transform the prospects of the poorest children, who need it the most, through the schools pupil premium which will be worth £2.5 billion by—

[Paul Goggins]

On a point of order, Mr Deputy Speaker. Is it in order for the Minister consistently to refuse to take an intervention from someone who has already pursued a specific issue and wishes, in the light of something that the Minister has said since, to take up that issue with him in a constructive manner?

[Mr Deputy Speaker]

That is not a point of order. I understand your frustration but the Minister, in fairness, has been generous to many colleagues. Unfortunately, you have been very unlucky in not catching his eye, but I am sure that, if he were generous, he just might spot you standing once more.

[Mr Hoban]

As I was saying—[Hon. Members: “Shame!”] Members on both sides of the House want to speak in the debate, Mr Deputy Speaker. I have been generous in giving way and I want to continue with my remarks.

Through the schools pupil premium, which will be worth £2.5 billion by 2014-15, as well as by extending the provision of 15 hours a week of early-years education and care to all disadvantaged two-year-olds from 2012-13, and by maintaining funding for Sure Start in cash terms, we will provide real opportunities for disadvantaged children to move out of poverty for the long-term. We will also use some of the savings from withdrawing child benefit from families with a higher-rate taxpayer to fund significant above-indexation increases in the child tax credit, thereby ensuring that the spending review will have no measurable impact on child poverty in the next two years.

Some people say that stopping Government payments to child trust funds is not fair to children, but there would be nothing fair about leaving the next generation with unsustainable debts that would mean higher taxes and poorer public services. We can fund our priorities at the same time as reducing the deficit only if we find savings elsewhere and this Bill will contribute to that. As I have said, it will end eligibility for child trust funds, repeal legislation on the saving gateway and abolish the health in pregnancy grant.

These were not easy choices to make, but they were the right choices. We simply cannot afford the luxury of spending half a billion pounds a year on the child trust fund when that money is not available to people for 18 years. We simply cannot afford to introduce a new scheme like the saving gateway as we start to tackle the most challenging fiscal position for decades and we simply cannot afford to keep spending £150 million a year on the untargeted, unfocused health in pregnancy grant. The tough choices that we have made on those policies will save £370 million this year, about £700 million next year and about £800 million each year from then on. That means £800 million less in spending cuts, tax rises or borrowing, as we would have had to find that money from somewhere else.

This is a timely debate as it comes on the day that a leaked Labour document acknowledges the lack of substance in Labour’s economic plans. If the Opposition oppose the Bill tonight, they will have to explain how they would plug the gap. If they do not, that will be further proof that their plans lack substance. We have made our choices and they have to make theirs. The Bill puts those choices into action and I commend it to the House.

17:59

[Mr David Hanson (Delyn) (Lab)]

If the Minister did not know the strength of feeling on the Labour Benches about this Bill before, he does now. It will hit children, women and families unfairly, it will hit the poorest in our society the hardest and it will undo the positive steps that the previous Labour Government took to tackle inequality. I say to him, on behalf of my right hon. and hon. Friends, that it is a bad Bill and that we will oppose it this evening in the Lobby. As the Minister has said, it removes eligibility for child trust funds, abandons the saving gateway and abolishes the health in pregnancy grant, each of which was a progressive measure of the previous Labour Government and was welcomed by groups that tackle inequality. Each of those measures is being jettisoned by the Conservatives and Liberal Democrats not as a matter of deficit reduction but as a matter of dogma. As my right hon. and hon. Friends have said in interventions, there has been no impact assessment. Not content with taking a gamble in the spending review on our jobs and growth, the Government have made choices that are unfair and that will hit the poorest in society the hardest.

Clause 1 concerns child trust funds, which were introduced by the Labour Government for three main reasons: to promote saving, to encourage financial education and to ensure that in future all young people would have a financial asset at the age of 18. The CTF scheme is having a positive effect. Between April 2008 and April 2009, a massive 823,504 CTF vouchers were issued—70,000 a month. More than 74% of those accounts were opened by parents and more than £2 billion is now held in those funds. At the end of this year, there will be 6 million child trust fund accounts for which the Minister will abolish contributions for the future.

[Mark Tami (Alyn and Deeside) (Lab)]

Does my right hon. Friend agree that it is clear that Government Members are ashamed of this terrible Bill as there is hardly anyone on the Government Benches to link themselves with it?

[Mr Hanson]

I give credit to the Minister for defending the indefensible, and I look forward in particular to hearing Liberal Democrat Members and others defend the removal of these grants, trust funds and the saving gateway, all of which help the poorest in our society.

[Martin Horwood (Cheltenham) (LD)]

Does the right hon. Gentleman accept that child trust funds were never designed to help children because they are paid to 18-year-olds and that when funds are scarce it is better to target them at children who are in education through something like the pupil premium? If his party was so concerned about people having an asset at the age of 18, why did it introduce tuition and top-up fees?

[Mr Hanson]

I shall not take lessons from the Liberal Democrats on tuition fees given the outcome that they have got in that regard. The hon. Gentleman needs to recognise that the trust funds are an investment to tackle inequality among people at the age of 18 and to give poor people in society a chance at the age of 18. Not every will have a trust fund at the age of 18: some of the Cabinet’s will, but not everyone’s. He should recognise that poor people need that help and support at the age of 18.

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

Does my right hon. Friend agree that the comments of the hon. Member for Cheltenham (Martin Horwood)s are a bit rich given the Liberal Democrats’ current position on tuition fees after they campaigned against them for years? The Government claim to be very interested in eliminating child poverty, but how will what has been announced tonight do that? It is sheer hypocrisy.

[Mr Hanson]

My hon. Friend is correct in the sense that there are ways in which we can tackle child poverty, such as by ensuring that people have an equal opportunity at the age of 18 to make progress in their lives through jobs, training and university. One way in which we were doing that was through the child trust fund.

[Sandra Osborne]

Does my right hon. Friend agree that if the measures were due to financial constraints, the Conservatives would have kept the CTF mechanism in place, given its success, and perhaps cut the contributions with a view to reinstating them when times were better rather than abolishing the funds altogether?

[Mr Hanson]

I shall come to that point later. The Government have chosen to take a sledgehammer to the funds and not even to consider other options such as that mentioned by my hon. Friend.

[Toby Perkins]

My right hon. Friend is touching on the choices that the Government have made. The number of attacks that they have made on children, families and women is revealing. They seem willing to give money to married couples who do not have children but they are taking money from families with children. Anyone who has been married and had kids knows that it is not getting married that costs money but having kids. When my son was four months old I thought that he was robbing my wallet because I had no money left. Does not the Government’s approach show how out of touch they are with the real lives of families and children?

[Mr Hanson]

I agree. The Government are not in touch with the difficulties of raising a child or of meeting the costs when children reach the age of 18.

The child trust fund is worth £500 to each child over their lifetime, but it is worth £1,000 to the poorest children. The Minister will know that the previous Labour Government also introduced a disability living allowance payment on top of £100 or £200 for those entitled to DLA. That measure was introduced to take into account the significant extra challenges that disabled people face at that important time in their lives. When that measure passed through Parliament earlier this year, under the previous Labour Government, the Conservative party did not oppose that addition. Indeed, the present Financial Secretary said that

“we recognise that additional support is required for children with disabilities, and we have no objections to this statutory instrument.”—[Official Report, Eighth Delegated Legislation Committee, 10 February 2010; c. 4.]

The Liberal Democrats’ spokesperson at the time said they were happy to support the regulations. Quite simply, the Government say one thing in opposition and another in government.

As young people reach 18, the financial challenges—not least those imposed on them by the current Government—will be more difficult. If individuals do not come from a wealthy background, the prospect of stumping up extra money for tuition fees is an eye-watering one. Not everyone will have a trust fund of their own to manage those resources. The children’s trust fund would have provided young people with an extremely welcome lump sum, would have helped people with education and training from the age of 18, and would have helped people to save who had never saved before to supplement their future income.

[Martin Horwood]

I may not necessarily be supporting the tuition fee proposal of my hon. Friend the Financial Secretary to the Treasury, but at least he is increasing maintenance grants for the poorest students, which the Labour Government did not manage to do.

[Mr Hanson]

May I just say three words to the hon. Gentleman: education maintenance allowance? I look forward to him voting to abolish that and to raise tuition fees—both of which he pledged not to do at the general election.

With child trust funds we are trying to help poorer people and those on lower incomes to save for their children’s future. Before the child trust fund, only 18% of children had regular long-term savings made for them. The child trust fund industry average is now 31%. Among families on incomes just above welfare dependency, 30% of the child trust fund accounts now have money saved into them every month. Families in the lowest income bracket are now saving a higher proportion of their household income for their children than those in affluent groups. Do not take it from me, Mr Deputy Speaker: parenting groups, charities, think-tanks and academics have all put their names to motions and supporting letters that say the decision to abolish the child trust fund, along with the saving gateway, is short term and misguided.

So today, as the Government prepare to take the child trust fund from our children, we need to know what they intend to replace it with. The Minister has said that there will be no substitute and no compensation for the scheme where there is a Government contribution to encourage that saving. I welcome the fact that he wants to consider a future scheme to maintain the infrastructure. We know that the annual cost of running the child trust fund was about £5 million last year. I hope the Minister will confirm and look, in the winding-up speech at least, at how we keep that infrastructure in place to ensure that parents can make voluntary contributions.

[Mrs Hodgson]

Does my right hon. Friend agree that the difference between the numbers of Members present on each side of the House is interesting? As the Minister said, Governments have to make choices; indeed, I think the Chancellor said that only last week when he announced the comprehensive spending review. Some of those choices are more difficult than others and some are more shameful than others. Perhaps there is only one Lib Dem Member in the Chamber and so few Conservative Members because this is a rather shameful thing that they are doing, and a lot of them cannot face up to what is being done.

[Mr Hanson]

We shall see. I welcome my hon. Friend’s contribution. When we debated the child trust fund and the reduction in funding in Committee in July, and when we had a vote on the Floor of the House, Liberal Democrat Members flooded into the Lobby to support that measure; Conservative Members flooded into the Lobby to take money away from newly born children from August of this year. That is a disgraceful position, and the strength of feeling that the Minister will face today from my right hon. and hon. Friends shows that Labour Members, who introduced the saving gateway, the child trust fund and the health in pregnancy grant, are proud to have done that and proud to defend them in the Chamber today.

[Pete Wishart]

The right hon. Gentleman is absolutely right that the coalition Conservative Government are doing some appalling things to women and children, but perhaps he could talk about what the Labour party did. Was not the Labour party going to halve child poverty? What actually happened to child poverty in the last few years of the Labour Government? Did it not go up?

[Mr Hanson]

I will say just this to the hon. Gentleman: record levels of the minimum wage, record support on Sure Start, record investment in education and tackling child poverty across the board. The Labour Government have a proud record of tackling inequality and trying those issues. [Interruption.] The Financial Secretary says, “Records of deficit”. I recognise, as does my right hon. Friend the shadow Chancellor of the Exchequer, that we need to tackle the deficit, and that is where the choice is today. The choice for the Financial Secretary is to cut deeper—[Interruption.] If he stops chuntering for a moment from the Front Bench and listens, he will hear me say that choices have been made to cut the deficit much more slowly than the hon. Gentleman was doing, over a longer period. There are other issues that could be looked at. The Government’s banking levy is worth a proposed £2.4 billion. If the Labour Government had been in office, that would have been £3.5 billion. There is £1.1 billion extra already from that funding. The hon. Gentleman knows there are differences of approach, and the Labour Government would have taken a different approach to the deficit, and would have been able to save those resources in a much better way.

[Owen Smith (Pontypridd) (Lab)]

Does my right hon. Friend agree that another example of the fundamental difference between what we would have done in office—indeed, what we did in office—and what this Government are doing today is the disgraceful sop we have heard from the Minister, replacing the child trust fund with a tax-free account, which as we all know will do absolutely nothing substantive to encourage saving among low-earning families, as the trust fund was doing? That is the real business we are debating today, and I, for one, think it is a mistake and a disgrace.

[Mr Hanson]

One of the great benefits of the child trust fund was that it encouraged people on lower incomes to save, it gave a kick-start to their savings accounts and it helped them to get into the habit of saving. The change that the Minister has made will mean that those people who can save will save, and those who are not used to saving, do not have the resources to save or are not part of that savings culture, will not save. That will impact, in due course, on the inequalities of people in their 18th year.

[Paul Goggins]

rose—

[Mr Hanson]

Before I give way to my right hon. Friend, let me say that one of the most disgraceful things will be the fact that the Government are taking child trust fund contributions from children who have no parents, who are in care, who need the support of the state to reach their 18th birthday—who will need that kick-start in due course. I am sure that is the point that my right hon. Friend was going to make.

[Paul Goggins]

I am very grateful indeed to my right hon. Friend for giving way. [Hon. Members: “Hear, hear.”] He has been very generous, as was the Minister until, for some unknown reason, he declined to take interventions towards the end of his speech. My right hon. Friend may remember that in an intervention I raised the issue of looked-after children. After that, the Minister announced, although he did not go into too much detail, the new tax-free savings account for children. Does my right hon. Friend think it would help if we knew how looked-after children might be able to benefit from the new scheme that the Minister just announced?

[Mr Hanson]

Perhaps the Minister can tell us that in his winding-up speech, because clearly, looked-after children, children in care, would have had a contribution to the child trust fund, which would have helped them, on leaving care at the age of 18, to start a life without parental support. That is an important contribution that this Government have taken away from looked-after children.

[Paul Goggins]

To be constructive: there may be opportunities for local authorities, for charitable trusts, for other people in the community, to contribute to funds set up in the name and for the benefit of looked-after children. Will they be able to benefit from this new tax-free savings account? I do not know, because the Minister would not take my intervention and answer the question.

[Mr Hanson]

I hope I can assure my right hon. Friend that as we have eight sittings in Committee, I will table amendments on some of those issues. Indeed, I can even offer him a chance to serve, should he so wish, on the Public Bill Committee in due course.

[Toby Perkins]

Teenage pregnancy levels are high in some of our most deprived communities, and the child trust fund at least offered 18-year-olds who were about to have children the chance to take a different track or to receive some support. Does my right hon. Friend agree that the Bill will take away a key tool in the battle against child poverty?

[Mr Hanson]

It will indeed take away a key tool in helping to deal with inequality and poverty at the age of 18. The child trust fund encourages saving, particularly among people from the poorest parts of our communities.

[Kate Green]

Is not the Minister proposing tax breaks for savers’ children, benefiting families who pay tax—the better-off—and widening inequalities, because non-taxpayers will get no benefit at all?

[Mr Hanson]

My hon. Friend is exactly right, and from her background outside the House as well as inside it, she will know how important that contribution is, but let me move on to the Saving Gateway Accounts Bill, which was introduced in 2009 by the Labour Government, again to encourage people on low incomes to save for their future.

Cash savings accounts were created for those on lower incomes, providing a financial incentive to save, with the Government matching, pound for pound, the money that people saved in the scheme. The scheme was proposed in 2001: 22,000 people have so far taken part in the pilots, and £15 million has been invested in savings through those pilots. The accounts have run for two years, and they have been a positive way for people to start to save, with help and support for those in our poorest communities.

The first pilot ran between 2002 and 2004, and 1,500 saving gateway accounts have been opened in Cambridge, Cumbria, east London, Manchester and Hull, in the part of the world of my right hon. Friend the Member for Kingston upon Hull West and Hessle (Alan Johnson). Additional pilots have been run recently in South Yorkshire. Those schemes have shown that we can generate new savers, new saving and, indeed, help people on poorer incomes to put aside money to meet some of the challenges that they face in their daily lives.

Hon. Members need not listen to me about the importance of those schemes; let me give them an authoritative voice on the Saving Gateway Accounts Bill:

“The Bill serves a valuable purpose in encouraging people, particularly those on low incomes, to save. People on higher incomes have an opportunity to smooth out fluctuations in income and expenses to which those on low incomes do not have access. If the Bill is successful in encouraging people to save, it will enable them to create a modest buffer against variations in income, such as the unexpected expense of being laid-off for a short period. It will give people a degree of financial security they have not had hitherto.”—[Official Report, 25 February 2009; Vol. 488, c. 323.]

Those are not my words, nor those of my right hon. and hon. Friends; they are the words of the Minister, who is now introducing proposals to end such schemes, although he supported the 2009 Bill—doing one thing in opposition and, yet again, another thing in government. At a time when potentially 500,000 people are being laid off because of the public sector cuts as part of the comprehensive spending review, the Government will take that support away from those who need it most.

In the absence of the saving gateway scheme, how does the Minister propose to promote the culture of saving among people on lower incomes? As my hon. Friend the Member for Stretford and Urmston (Kate Green) said, how do we ensure that saving is not the preserve of the rich and that it is done throughout society, so that people can help themselves and ensure that they save for the future in partnership with the state?

If we turn to the last part of the Bill, we see the full force of the coalition’s new politics turning itself on those who are pregnant. Any hon. Member who is a parent knows that raising a child is a uniquely rewarding experience, but we all need to recognise that it can be financially challenging in the run-up to a birth and that it can be difficult for young mothers and young families. Not only was the health in pregnancy grant introduced in recognition of the health benefits of covering some of the additional costs involved during pregnancy, but it was paid universally to all mothers to ensure that they could buy help and support during the last weeks of their pregnancies. Such support covered healthy eating, vitamins, medicines, books on healthy pregnancy or the cost of maternity clothes or folic acid, as mentioned by my hon. Friend the Member for Bolton South East (Yasmin Qureshi). Folic acid can help to reduce the risk of spina bifida, but 400 mg costs £9.99 at Boots. The health in pregnancy grant can be used for those costs and put towards getting help and support for health, and it is linked specifically to ensure that advice is given to mothers in pregnancy as part of the deal.

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

I am sure that hon. Members on both sides of the House agree it is important to target resources at the most vulnerable, but in dealing with pregnancy specifically, can the right hon. Gentleman point to any evidence that such help has improved the outcomes of deliveries, or births, or the health of ladies during their pregnancies?

[Mr Hanson]

If the hon. Gentleman cared to listen not just to me but to a range of groups that support pregnant mothers—from maternity groups to the Fawcett Society and others—he would find that there is a real input. He has a medical background, but if he is telling me that the grant does not matter to individuals who pay extra for healthy eating and minerals, who take medicines to reduce the risk of spina bifida and who need to buy maternity clothes and so on, I would like him to stand up and tell his constituents why that is so.

[Dr Poulter]

The right hon. Gentleman is making points about a grant that is given later in pregnancy and talking about minerals that are given earlier in pregnancy, so he needs to understand the issue a little better, but can he give any evidence of how the grant has improved the outcomes for mothers during pregnancy? Can he produce such evidence from any birthing group, any obstetric group or any midwifery group?

[Mr Hanson]

The hon. Gentlemen need not listen to me but should listen to the groups that are arguing for the retention of the grant. It is important not just for health but for costs of pregnancy, such as maternity dresses or equipment for the home, or covering time taken off work through ill health. Women on poor incomes need help and support to cover those important things, and this universal grant can help individuals to meet those needs at a time of great stress in the 25th week of pregnancy.

[Catherine McKinnell (Newcastle upon Tyne North) (Lab)]

I noticed that the Minister referred during his submission to a quotation from the National Childbirth Trust, which expressed its upset that the grant was not provided earlier in pregnancy. I also have a quote from the trust that might provide the evidence requested by the hon. Member for Central Suffolk and North Ipswich (Dr Poulter):

“At a time when families are trying to make ends meet, the Coalition Government has hit parents particularly hard. Cutting pregnancy and maternity grants, as well as child benefit and tax credits, will make it even more difficult for new parents or those wanting to start a family… the Government should stick to its commitment to making the UK more family friendly.”

[Mr Hanson]

My hon. Friend quotes the chief executive of the National Childbirth Trust, but she could have also quoted the Royal College of Midwives, which said that there is an opportunity for midwives to communicate health advice to women and their families, as the grant is dependent on engagement with health practitioners. Never mind the cost of maternity dresses and other clothes, minerals, healthy eating, advice or taking time off work, these are important grants.

The Bill shows that the Government are out of touch with the needs of the vast majority of the British people. A £190 maternity grant may not seem much to some Government Members, but for the shop worker getting by on the minimum wage, it is a significant amount of money. For a woman with an unemployed partner, it might make a difference to the future health of their child. For those people, the grant makes a difference. Like the child trust fund, the grant is about investing in our future and in our children’s health and in giving them a good start and ensuring that they have a break at the age of 18, to make their way in life with positive support.

[Kate Green]

Does my right hon. Friend agree that one of the things that is likely to happen if women are given a sum of money in the seventh month of pregnancy is that they will go out and spend it, thereby also helping to regenerate their local economies?

[Mr Hanson]

Indeed. That is a good point, but I would say in passing to my hon. Friend that, unless I missed something, the Minister seemed to indicate that he did not feel that women would spend the money on things that matter for their pregnancy. He seemed to take a “shoes and nail varnish” approach in relation to what the grant has done. Most women take a great interest in the development of their children—that is the most important thing in their pregnancies—and they will do things to ensure that their children have a great start in life, and the grant was an opportunity to help in that respect.

[Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab)]

Government Members are slightly confused on this matter. The Government keep saying that these draconian cuts for the poorest children are necessary to help the deficit and laud their own policy of giving two-year-olds 15 weeks’ free education, basing access to such a service on eligibility for free school meals. How many two-year-olds receive free school meals at the moment? If those two-year-olds do not have older siblings, what mechanism must be set up across Departments to work out which two-year-olds are eligible? What is the cost of such a mechanism? How much of the money recouped from the cuts that the Government propose will be wasted on a complicated mechanism to work that out?

[Mr Hanson]

My hon. Friend makes an important point. There was a thread running through the Labour Government’s intentions to ensure help and support for children, help and support for those on low incomes to save, and help and support for families to save for their children’s 18th birthday and beyond. [Interruption.] The Liberal Democrats are down by 50% already—down to one Member present.

[Martin Horwood]

In defence of my hon. Friend the Member for Bristol West (Stephen Williams), he is attending a Bill Committee.

[Mr Hanson]

The hon. Member for Bristol West (Stephen Williams) is a member of the Finance Bill Committee, as am I. I am in the Chamber defending our position on behalf of the Labour Opposition. The hon. Gentleman is in the Finance Bill Committee saying nothing about what is happening upstairs and supporting the Conservative party in Divisions upstairs. The hon. Member for Cheltenham (Martin Horwood) should reflect on those matters.

The changes proposed in the Bill, coupled with changes to direct tax, tax credits and benefits, will hit women harder than men. The spending review changes hit women twice as hard as men. The emergency Budget changes hit women three times as hard as men. Cuts in child care, tax credits, child benefit and other support will make it harder for women to work. More than £6 billion is now being cut in direct financial support for children—three times more than is being taken from banks.

I come back to the fact that the banking levy proposed by the Conservative Government, which was a Labour Government initiative, will raise £2.4 billion. My right hon. Friend the Member for Kingston upon Hull West and Hessle proposes a banking levy of £3.5 billion.

[Mr Hoban]

The banking levy was not an idea of the previous Government. The previous Chancellor of the Exchequer ruled out the banking levy that we have introduced.

[Mr Hanson]

No. If there is a banking levy in place, we will support a higher banking levy. Would the hon. Gentleman support a banking levy of £3.5 billion and scrap the abolition of pregnancy grants today? No, he would not.

[Mr Hoban]

Last week the banking levy that the shadow Chancellor proposed was to pay for infrastructure. This week it is to pay for the cost of child trust funds and the health in pregnancy grant. With the banking levy stretched so far, the right hon. Gentleman needs to control his spending commitments.

[Mr Hanson]

There is a range of measures that the Labour Government introduced and would have introduced in relation to deficit reduction. There is a range of measures that my right hon. and hon. Friends and I were elected to implement to reduce the deficit over a four-year period, including an additional banking levy and help and support for deficit reduction. [Interruption.] The Financial Secretary says that is not so. Whatever happened at the general election, we were elected on a policy to reduce the deficit over four and a half years. We would have done that. We would have implemented measures including a range of tax changes and help and support for public sector efficiencies of £15 billion. He is making a choice that puts women, children and the poorest in our society at the greatest disadvantage as a result of the changes. That is a disgrace. We should have looked at the situation differently.

[Mr Russell Brown (Dumfries and Galloway) (Lab)]

I hope my right hon. Friend will take the opportunity from the Opposition Front Bench to remind the Minister that it was our aim to raise an additional £19 billion through taxation, 60% of which would have come from the top 5% highest earners.

[Mr Hanson]

Indeed. As my hon. Friend knows, even now some of the Budget measures that make the Budget seem fairer than it is are measures that we supported in government and which the Conservative Government opposed when they were in opposition. I will not take lessons from the Conservative Minister on fairness towards pregnant women, children and those on poorer incomes, because the Labour Government, when in office, had a proud record of fighting on those issues.

In conclusion, the debate is about choices for the future. As my hon. Friends have pointed out, other choices could have been made. I am not saying that I would have supported them or agreed with them, but the Government could have considered a range of other choices. They could have suspended payments for a period of time for the child trust fund, the maternity grant or the saving gateway. They could have means-tested them, so that individuals with the highest income in society did not receive the maternity grant or the child trust fund.

The Government could have considered measures including a payment holiday. They could have considered phasing out the support over a longer period. They could have done all those things, but they have not. They have taken a sledgehammer to the child trust fund, the saving gateway and the health in pregnancy grant. It is not the deficit that is driving these measures; it is dogma on the part of the Conservative party.

The Government do not recognise the pressures of bringing up a child with limited financial means in the 21st century; they do not understand the difficulties faced by people trying to save on low incomes; and they do not understand the difficulties that mothers- to-be on low incomes face in the final weeks of their pregnancy. The Bill shows that the Government have made the wrong choices. It will deepen inequalities in our society, and I urge all right hon. and hon. Members to reject it.

18:35

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

It is a pleasure to follow the shadow Minister, the right hon. Member for Delyn (Mr Hanson), who was my first political foe when I was just 14 and he was leader of Vale Royal borough council. In the intervening 20 years, he has only got worse. That is a sad thing to have to say.

It is important that we remember why we are here today and what we are here to discuss. We are not here to discuss whether it is a good idea for families to save, or to encourage children to save. We are not here to discuss whether it is a good idea that pregnant women should enjoy good health during pregnancy. We are here to discuss whether the specific items of legislation introduced by the previous Government achieved their goals and warrant continuation.

The Labour Government had a fondness for introducing legislation willy-nilly, volume after volume of it. At no point did they ever feel a need to investigate whether their legislation achieved its goal. I have nothing against innovation in public policy. The work of think-tanks is important, and it is a disappointment to me that the former Prime Minister, the right hon. Member for Kirkcaldy and Cowdenbeath (Mr Brown), is not in his place today to defend his creation, as I know he felt such a passion for it at the time.

What we are here to do today is to decide whether specific items of legislation were effective—not whether they were popular, whether they made Labour Members feel good about themselves, or whether they excited think-tanks, interest groups, pressure groups or campaigners. The question is whether they achieved what they set out to achieve. We cannot have such a discussion without considering the wider economic issues. Every day we are spending £120 million just paying off the debt that we inherited from Labour. I could spend that money in my constituency alone 40 times over. I am sure every Member in the House could do so. We must place the debate in the wider economic context.

There are two important tests that we should apply to any legislation. I call them the Ronseal test and the rhododendron test. The Ronseal test, for those who watch commercial television, might be a bit obvious: does it do what it says on the tin? Any piece of legislation and its effectiveness must be assessed on whether it achieves its goal.

The rhododendron test might be a little more obscure. I often find when listening to those who represent the left in British politics that they identify totemic pieces of legislation that they consider vital and which become representative of a much wider public policy area. They go on to defend that legislation to the hilt, thereby ignoring every other aspect of public policy in that area that could make a difference, just as in a parkland, where rhododendron may look beautiful but it covers so much ground that it chokes off wider growth that might be beneficial.

If we apply those two tests to the child trust fund, for example, how do they stack up? Originally, the former Prime Minister called it the baby bond. It was meant to be a nest egg, a form of what was then in vogue—asset-based welfare. Unfortunately, the fund was not much of an asset by the time the child got to 18. The scheme certainly was not what the philosophers behind the idea of asset-based welfare had in mind. Others sought to define it as progressive universalism. We have a habit in this country of trying to adopt fancy-pants names for new ideas, philosophies and ways of looking at politics, and I am not entirely clear what progressive universalism actually means.

[Kate Green]

I shall be happy to explain to the hon. Gentleman what progressive universalism means in the context of the child trust fund. It means that all children receive something but the poorest receive more. In that way, we obtain the benefit of popular support for a policy that directs more money to those who need it most.

[Paul Maynard]

I thank the hon. Lady for what I presume she thought would be a helpful contribution for idiots like me. I shall read a useful quotation from the Child Poverty Action Group in 2005, which I believe the hon. Lady chaired at the time. It is a lengthy quotation on the group’s approach to the fund, but it bears repeating:

“Although the Child Trust Fund will benefit some lower income families, we are concerned that families who are at greatest risk of living in severe and persistent poverty are the least likely to be able to contribute to the CTF, so their children will derive little or no financial benefits when they turn 18.”

[Kate Green]

rose—

[Paul Maynard]

Forgive me, I shall not give way because I have not yet finished the quotation.

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

Give way!

[Paul Maynard]

If the hon. Gentleman will calm down and let me finish the quotation, I shall happily give way. Learn some manners, sir, please.

The CPAG continued:

“The very children who would benefit most from having savings and assets are likely to derive least financial advantage from the scheme.”

I shall now give way to the hon. Lady.

[Kate Green]

I am very grateful to the hon. Gentleman. It is true that the CPAG, of which I was chief executive at the time to which he refers, had some misgivings about the initial design of the child trust fund. Thanks to our lobbying, I like to think, the product was improved over time and the extra payments for low-income children were then introduced. Does the hon. Gentleman not agree that that was rather a good development in a policy that is certainly still ripe for improvement, as he rightly says, but not for abolition?

[Paul Maynard]

Let us rejoin the theme of progressive universalism, which the hon. Lady so kindly and patronisingly explained to me. If the fund is so universal, why in the first four years did 25% of people not apply for it? To me, that is not universal; that is rather partial.

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

Is the hon. Gentleman aware of the research by Elaine Kempson of the university of Bristol on the increased take-up of the child trust fund? Three out of every five parents now take it up automatically, and the state picks up the rest.

[Paul Maynard]

Three quarters of those accounts opened since 2005 have failed to receive additional deposits; 99% have not received the maximum funding available; and only 71% of eligible children have a child trust fund. I am not trying to argue, as Opposition Members seem to think, that the fund is a failure; I am trying to argue a more subtle point, that this piece of legislation—this policy innovation—has not achieved its goal.

[Catherine McKinnell]

Will the hon. Gentleman give way?

[Paul Maynard]

I shall give way on this one occasion.

[Catherine McKinnell]

The child trust fund has not been in existence long enough truly to reap the benefits that it would if it were kept on. In respect of deposits, the fact is that when parents have young children, their outgoings are extremely high, but if the child trust fund is in place in the future, when they have more expendable outgoings, they are able to invest more money in it. So, an awful lot of parents who might not invest when the child is a baby might do so in a few years’ time when the child has gone to school and they are not paying for child care and so on.

[Paul Maynard]

I thank the hon. Lady for those ifs and buts. We can all hope for what might happen at some point in the future.

The shadow Minister, the right hon. Member for Delyn, set out three reasons why Labour introduced the measure. It was about inculcating a savings culture, encouraging financial education and providing a nest egg. So, rather than assessing the measure against the legislation, let us try to assess it against what the shadow Minister said was important.

There is no evidence that the fund has encouraged a savings culture. Many organisations that promote financial education come to me time and again to ask, “Why didn’t the last Government do more to promote financial education, particularly at primary level?” In the average family, a piggy bank—

[Stella Creasy]

Will the hon. Gentleman give way?

[Paul Maynard]

Sorry, I am not going to give way any further. I have been very generous in giving way, but I am afraid that I am not a bus stop.

[Stella Creasy]

rose—

[Paul Maynard]

No, I am sorry, but I am not giving way to you, madam, so kindly take notice of that.

Having a piggy bank—[Interruption.] I am going to make the point that having a piggy bank in one’s bedroom is a much greater spur to saving and learning about the culture of savings than any attempt to lock away money until the age of 18.

The right hon. Member for Wythenshawe and Sale East (Paul Goggins), and the hon. Member for Kilmarnock and Loudoun (Cathy Jamieson) in her Westminster Hall debate, have raised the issue of looked-after children and how we deal with them. It is a very important issue, but the Opposition should hang their head in shame at the outcomes that looked-after children obtain after 13 years of Labour rule. The points that those Members made were an example of what I call the rhododendron test. By focusing on the tiny issue of whether such children should continue to receive child trust fund payments, they overlook the much wider public policy issues. There are many other ways in which we can and do help looked-after children.

[Diana R. Johnson]

What? By cutting the child trust fund?

[Paul Maynard]

Sorry, but if you are going to make interventions, madam, please stand up.

[Diana R. Johnson]

I should like to make two points. First, before the election in May, the Tories voted against introducing personal, social and health education—including economic and financial education—and making it a statutory subject in all schools. So, the Tory party should hang its head in shame. Secondly, on looked-after children, what are they doing as a Government—

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. The intervention has gone on for far too long. The hon. Gentleman is making his points, but he must return to the issue at hand.

[Paul Maynard]

Thank you for that advice, Mr Deputy Speaker.

There are other ways in which we can and do help looked-after children. In particular, for example, there is a high correlation between looked-after children and poverty. That stands to reason, particularly in terms of their geographical location, but the pupil premium, which we announced recently, will go a long way to helping those children who are in education to make it as far as university in the first place. Finally, on the child trust fund, I welcome the notion of a children’s ISA. I hope that I hear about it in a future announcement or Budget.

I should now like to apply my two tests to the health in pregnancy grant. It is what it says it is: it is about health in pregnancy. The former Prime Minister, when Chancellor, introduced the policy, saying that the Government had received “powerful representations” regarding the importance of good nutrition during the final stages of pregnancy. The grant was clearly designed to promote health in pregnancy, but, when the measure was going through its Delegated Legislation Committee, the then Health Minister, the right hon. Member for Exeter (Mr Bradshaw), accepted that the bulk of health improvements occur when changes in behaviour occur earlier in pregnancy. Waiting until the seventh month is rather like shutting the stable door after the horse has bolted; it certainly does not encourage a behavioural change.

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

By that very logic, would it not therefore make sense for the hon. Gentleman’s party to propose an earlier payment of the grant?

[Paul Maynard]

I could well ask why you did not think of that when you introduced the scheme in the first place. It is a bit late now—

[Mr Deputy Speaker]

Order. Everything has to come through the Chair. We have to work through the Chair and not be distracted as we have been.

[Paul Maynard]

Improvements in diet are important, but the waiting times for those applying for the health in pregnancy grant have been anything up to eight weeks, by which point the money that was supposed to transform their ability to access an improved diet is simply not appearing. It would be very easy to dismiss—

[Catherine McKinnell]

Will the hon. Gentleman give way?

[Paul Maynard]

No, I am not going to give way now—[Hon. Members: “Give way!”] No, I do not want to give way—[Interruption.]

[Mr Deputy Speaker]

Order. The hon. Gentleman has given way quite a lot, and if he does not wish to give way now, hon. Members must accept it.

[Paul Maynard]

It would be very easy to dismiss health in pregnancy grants, as some Opposition Members seem to think that we are doing. I am not doing that. My constituency has significant pockets of poverty, and if Conservative seats were ranked in order of deprivation, mine would be somewhere near the top. I spent a fascinating Friday a couple of weeks ago with our family nurse partnership, a pilot project that is working with young mothers-to-be in the most deprived quartile of the population in the most deprived areas of the constituency. They receive intensive support from the moment they become pregnant to beyond the birth. It is a fantastic project and it costs £3,000 per mother. The project also works with the father. It addresses issues such as self-esteem, improving literacy and numeracy, helping the father to get back into work and ensuring that the father feels part of the birth.

To my mind, the project achieves far more than a £190 health in pregnancy grant. One might argue that it is a significantly greater amount of money, but I would argue that it represents a different approach to policy making. The hon. Member for Nottingham North (Mr Allen) is looking at early intervention on behalf of the Government and he is a strong supporter of the family nurse partnership. I think that it makes a much greater difference to outcomes if we have evidence-based policy. My hon. Friend the Member for Central Suffolk and North Ipswich (Dr Poulter) was correct to pursue the Opposition about the lack of medical evidence for improvements in the health of pregnant women—

[Catherine McKinnell]

Will the hon. Gentleman give way?

[Paul Maynard]

No, and the quote that I heard from the hon. Lady did not pass the quality threshold for the British Medical Journal and nor was it ever likely to do so, coming as it did from a press release.

It is also worth bearing in mind that we give other targeted interventions for pregnant women that are designed to assist them. The Minister has referred already to the Sure Start payment and the healthy start payment, and the latter is specifically designed to support women who wish to improve their dietary health by purchasing fruit, vegetables, vitamins and other things that will assist them. Interventions must be properly targeted and not just handed out. It is all very well to oppose this measure, but not to do so by reference to generalities. These proposals have to be considered in the round, and those Opposition Members who may not like this proposal need to suggest what they would do instead and how they would seek to cut the deficit that they have left behind.

This Bill is the start of something new and radical. I am a great fan of Ronald Reagan, the former President of the United States—as we all should be. He always said that he lived on the sunrise side of the mountain and I always try to do so too. Although my glass is often half empty, when I consider things I try to take an optimistic view, and I consider this to be an important measure. It says that—unlike the previous Administration —no longer will we pass legislation year after year without bothering to ascertain whether it achieves its purpose. We will pass legislation based on the evidence of whether what has gone before has worked and whether it assists in meeting the wider challenges of public policy that we face—both economic and social. I urge the House to support this Bill, not just because it will assist us in reducing the deficit, but because it introduces the concept of evidence-based, high-quality public policy making, and that is sorely needed in this country today.

18:54

[Teresa Pearce (Erith and Thamesmead) (Lab)]

I am grateful for the opportunity to speak about clause 1 of this Bill today. In 2005, the child trust funds were launched in an attempt to build financial education and encourage habitual saving. The scheme was progressive in that it gave additional financial help to those who needed it most, with larger sums given to children from low-income families, children with no families—those in care—and disabled children.

The Government’s decision to introduce this Bill to phase out and then stop all Government payments to child trust funds is short-sighted and unfair. It is short-sighted because it scraps a popular scheme that encourages young people to save, without putting a replacement mechanism in its place. It is unfair because it is part of a package of measures contained in the comprehensive spending review that asks children and families—and children with no families—to play a bigger role in reducing the deficit than the banks and large corporations.

Ministers have failed to say what they would put in place of child trust funds to encourage families, and low-income families in particular, to save specifically for their children’s future. In answer to a written question on 20 October asking what the Department for Work and Pensions is doing to encourage saving among low-income families, the Minister of State, Department for Work and Pensions, the hon. Member for Thornbury and Yate (Steve Webb) cited a number of general initiatives to encourage adults to save for later life, but failed to mention any plans to encourage parents and children—and children without parents—to put money aside to help with the transition to adulthood.

At the moment, it seems inevitable that the winding down of child trust funds will reverse recent efforts to increase the financial literacy of young people in this country. Financial knowledge and education in this country are at a worryingly low level. The savings ratio, which measures what proportion of earnings people in Britain are putting aside as savings, recently fell to the lowest level in seven quarters. That is no doubt linked to the recession, with wage freezes reducing household income while the cost of living continues to rise. With more strain being placed on family budgets and people having to dip into their savings, families need more help, not less, to put money away for their children’s future.

Child trust funds have an important role to play in helping young people engage with financial institutions early in their lives and to develop saving as a habit. The funds also provide young people with a level of financial independence and therefore responsibility. It is particularly important for children from low-income families, where such a significant financial asset accessed at age 18 can help with social mobility. Studies show that young adults with a small amount of capital at the beginning of adulthood had a significant advantage 10 years later over those who did not.

Child trust funds are a good way of reaching families who otherwise may not save. Stopping the child trust fund scheme will only increase the chance that social mobility will remain static. Parents with financial knowledge and greater means will likely continue to put money aside for their children’s future and instil in their children the value of saving. The children of parents who lack these resources, or children with no parents, will fall behind. The Government say that child trust funds have not been successful, but as no recipient has yet reached the age of 18, I do not understand how that can be judged.

HMRC statistics show that 10,841 vouchers were issued in my constituency and more than 8,000 child trust funds were opened by parents or guardians, with the remaining ones opened by the Revenue on the child’s behalf. So the initial take-up rate has been positive. The most important point that needs to be made in this debate is that the Government are not proposing to stop Government payments to child trust funds in order to reallocate the money for children elsewhere. The funding is simply being cut, with the relatively modest cost of child trust funds—£320 million this financial year—going towards reducing the deficit. Thus, a valuable scheme to help young people is to be sacrificed in the name of short-term expediency.

The Financial Secretary to the Treasury says that the eradication of the deficit is the Government’s “top priority”. However, if this is the Government’s main priority, they would do better to look at the state of the UK tax system where the top five retail banks stand to cut around £19 billion from their tax bills in the future because of huge losses during the economic downturn, despite being saved by the UK Government through an £850 billion bail-out.

The tax payments that those banks are expected to contribute to the Government are nowhere near the expectations of most people in the UK. Banks are not being told to bear their fair share of the deficit burden that was run up because of their reckless behaviour. Instead, it is children and families, and children with no families who are being asked to bear the brunt of the cuts through the scrapping of schemes such as the child trust fund. The Chancellor used the word “fair” 24 times during his statement last Wednesday, but in reality his spending review takes more money away from children to help reduce the deficit than from the banks responsible for it.

On a personal note, as I stand here this evening, my youngest daughter is in hospital in Dartford, in labour with her first baby. She was born in 1979 under a Tory Government, and my granddaughter will be born in 2010, also under a Tory Government. The previous Tory Government came for my daughter’s school milk, but at least she was five when they took it from her. From my granddaughter, however, they are taking away the child trust fund when she has just been born, and the health in pregnancy provisions before she is even born. It seems that the priorities of the Tory party are always the same.

19:01

[Richard Graham (Gloucester) (Con)]

Before coming here I read a document from the Save Child Savings alliance, which hon. Members might have had a chance to look at. I thought it would be helpful to run through some of its points about why it is so important to maintain and retain child trust funds, and answer them one by one. Its first major point is that child trust funds are all about fostering a long-term savings culture. I am sure that everyone in the House, from whatever party, will agree that that is a major national goal. However, the point about a long-term savings culture is that every form of fund or saving, including pensions, is exactly that—savings. So we cannot look at CTFs in isolation. The SCS alliance’s second major point is that keeping CTFs will help to protect the savings culture in the UK. To that, we could add the CTFs’ original goal of spreading financial literacy.

The question at stake this evening, therefore, concerns two main points: first, how effective have CTFs been in delivering either their original goals or the aims suggested by the SCS alliance? Secondly, what choices and other alternatives are available to provide the best for our nation’s children? The results so far show that CTFs have, over their lifetime of just over five years, accumulated £2 billion of assets, which is a reasonable absolute figure on its own. However, £1.4 billion of that was provided by the Government, and only £600 million by the families and friends of those participating. As mentioned by my hon. Friend the Member for Blackpool North and Cleveleys (Paul Maynard), the take-up amounts to 70%, with 24% of open accounts having received no contribution from participating families or friends.

Many better forms of savings are available in the marketplace for achieving the same ends. In particular, I highlight the existing individual savings accounts, which came from the original personal equity plans of the 1980s. These provide significantly more investment options, have, by and large—although not altogether—delivered better performance and have much lower costs. They can be designated to children, which is important, and cost the taxpayer nothing.

[Owen Smith]

Is that not an unfair comparison, because the ISAs have been in place for much longer than the child trust funds? It is extremely early in the life of CTFs for one to conclude that they will not achieve what they might achieve, and what we would hope they would achieve. A good point was made earlier about the point at which families tend to invest in long-term savings for their children. We can safely assume that more would have been paid in by families and friends at later stages, as more expendable income became available.

[Richard Graham]

The hon. Gentleman is right that this is a short period of history over which to judge them, but the fact remains that the annual management costs for CTFs, at 1.5%, are significantly higher than most of us would need to pay for an alternative form of savings. That will not alter over time. In answer to the suggestion that, in time, parents, families and friends might put more into the accounts, there is nothing to prevent them from opening an ISA or, as the Minister suggested, a new denomination of children’s ISA—if one becomes available—in their child’s name. Although I think that half the point made by the hon. Member for Pontypridd (Owen Smith) is right, I do not think that the overall impact of CTFs would be positive.

[Catherine McKinnell]

The hon. Gentleman made a point about accessibility and the fact that 25% of child trust funds set up by the state are not taken up by the individuals. How does he suggest that that 25% of people benefiting from those savings funds will benefit from ISAs, given that they are unlikely to walk into a financial institution to arrange one for their children?

[Richard Graham]

I have a specific suggestion on that, which I will come to in a moment. Meanwhile, I am sure that the hon. Lady will have noted earlier the intervention from my distinguished colleague on the Work and Pensions Committee, the hon. Member for Stretford and Urmston (Kate Green), who in an earlier career pointed out that CTFs do not necessarily reach the most vulnerable families. Arguably that was a flaw in the concept at the beginning.

[Kate Green]

It is important to clarify this point. I did not say that they did not reach the poorest. I said that it was difficult for the poorest to participate in the savings element. However, as my hon. Friend the Member for Newcastle upon Tyne North (Catherine McKinnell) just pointed out, with an ISA product there would not be any element of asset building for the very poorest, because they would be unable to save for themselves.

[Richard Graham]

The only difference is that CTFs are funded by the Government, so we come to the argument about whether that funding can be used more effectively in the context of the goals. I was going to come on to that. I suggested that there are alternative forms of savings that are more effective than CTFs, have lower management fees and better performance, and come at no cost to the taxpayer.

I come to the next point made by the SCS alliance. It argues that CTFs have been

“one of the most successful government savings schemes ever”.

Members will agree that everything is relative. Clearly, CTFs did better than the previous Government’s attempt to create a savings scheme—the stakeholder scheme—which is a scheme that not even the right hon. Member for Delyn (Mr Hanson), in one of his more elaborate flights of fancy, could conceivably describe as having been an outstanding success. However, by comparison with the success of other savings schemes not run by the Government, CTFs have done only a relatively modest job.

The important thing is that, although Governments can, do and should create the structure for savings schemes, their track record in running them is not good. For example, do Members believe that we should be paying people to work for Her Majesty’s Revenue and Customs and spend their time advertising and promoting CTFs, or do we believe that they should be ensuring that benefits go to the right people and that we all pay the tax that we should pay? HMRC should not be in the advertising business.

[Catherine McKinnell]

rose—

[Richard Graham]

I have given way to the hon. Lady already, but I am happy to do so again

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. If hon. Members are going to give way, they should give way quickly. If not, the hon. Member trying to intervene must sit down.

[Catherine McKinnell]

On the hon. Gentleman’s point about HMRC officials spending their time promoting savings accounts to children and parents, the idea is to give a hand-up, rather than a handout. Rather than benefits being handed out to families, the idea is to encourage saving in a family and to make it accessible to families that would not otherwise easily access saving funds. That is a hand-up, rather than a handout, and I would have expected Government Members to support such a programme.

[Richard Graham]

The answer is that we all want to encourage hand-ups to everybody, through whatever means possible, but that brings us to the second point about the difficult decision that the Government have had to take in their proposals—and which we as individual Members have to take—which is: what are the alternatives? I will come to that in one second, but on the Government’s role in running saving schemes, one crucial lesson that I hope will be learnt from the stakeholder experience and, now, from CTFs is that the Government should operate such schemes at arm’s length. When it comes to the creation of the national employment savings trust—or NEST—by the Department for Work and Pensions, I very much hope that that lesson will be taken on board.

The question then is one of choice. What could we do for our children with the money that the Government have been spending on CTFs that would be more effective? My belief is that the best investment that any of us can make as parents for our children is an investment in education. Therefore, Members need to focus on several crucial changes that have been made in the education of our children. Those changes will cost the Government and the taxpayer significant amounts of money, but that is an investment on which I believe we will all see a significant return. First, the retention of Sure Start children’s centres, which were begun by Labour, is an important move by the Education Secretary. Secondly, there is an extension of the availability of free education to every three and four-year-old in the country. Thirdly and most significantly, there is the poor pupil premium, which will cost the Government some £7 billion over this Parliament and which comes on top of baseline funding for schools.

I really believe that the most important thing that any of us can invest in is education. This is not about money: I do not believe that there is any evidence that financial literacy in this country has improved as a result of CTFs, nor, in a sense, could it, because the children are not involved. Children benefit from financial literacy programmes that go into schools and talk about what type of mobile telephone package they should have and so on, not from being given a lump sum of money that goes into an account with which they have no involvement. From the choices available to the Government, the best way to spend the money was and should be in education. For that reason, I shall be supporting the Bill.

19:13

[Jim Shannon (Strangford) (DUP)]

It is a sorry day on which we are debating this Bill on the Floor of the House. It is a sorry day too, when we realise that the people whom the Bill will hurt are those whom we have always had concerns about. The hon. Member for Blackpool North and Cleveleys (Paul Maynard) said that he could not see the real benefits of the schemes. As the elected representative for Strangford, I can quite clearly see the benefits for the people who come to my office—the people I help, the people I see every day. The attacks and the changes for children and pregnant women are wrong. The policy and the strategy that the Government have put forward will unduly hurt those who can ill afford it, and who will feel the impact more than most. I understand the need for the coalition—indeed, the need for us all—to look at how we can best save moneys, but the question has to be asked: is this Bill the best way forward? Is the best way forward to deprive those who can least afford it, and who will feel the impact more than most?

I did some research on Strangford—with the help of the staff in this place, of course. The number of parents or guardians in my constituency who have taken advantage of child trust fund vouchers totalled just shy of 6,800, with some 5,000 being for accounts opened by the parents or guardians and just under 2,000 for accounts opened by HMRC. The figures for Northern Ireland are clear, and they send a message. Northern Ireland has taken advantage of the scheme, and the area that I represent is part of that. Some 123,000 vouchers were issued before April 2008. My constituency has the third highest take-up of vouchers by percentage. For me, and for where I work and live, that clearly shows that the child trust fund puts money into the pockets of those who will need it in the time to come. It also enables young children eventually—when they turn 18—to be presented with a tax-free fund. I believe that the child trust fund should and could have done that, if it had been given the opportunity.

[Mark Durkan (Foyle) (SDLP)]

The hon. Gentleman will recall, from his time in the Northern Ireland Assembly, the strong campaign that was fought there to ensure that credit unions in Northern Ireland could become providers of child trust funds. That campaign was fought in this House too, such was the demand to ensure that child trust funds were used in Northern Ireland and to improve direct take-up, with more choices being made by parents. That campaign was backed by all parties and all communities in Northern Ireland. That is how popular child trust funds were.

[Jim Shannon]

I thank the hon. Gentleman for his intervention. The credit unions facilitated that role for child trust funds, as other Members have mentioned. The scheme was extremely popular in the area that I represent and in Northern Ireland as a whole. The figures that have been released clearly show that.

Parents did channel moneys and savings through for their children, but with respect I feel that the coalition—our Government—has stopped a worthwhile scheme, which will hurt the pockets of those who need help most. The ripples of that will come through in the next few months.

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

The hon. Member for Blackpool North and Cleveleys (Paul Maynard), who spoke on behalf of the coalition a short time ago, suggested that the best way to encourage savings was to have a piggy bank in the bedroom. With the greatest respect, when we think about the amount of money that the parents of many of those children will have to pay and how much less they will have to spend on their children, we have to ask: where will they get that money to put into the piggy bank, and will that not increase the divide in our society and penalise its poorest members?

[Jim Shannon]

It has been mentioned by others that, for a great many in this House, there is an equality issue with this Bill. It will disadvantage those who can least afford it, and will give an advantage to those who perhaps do not need such schemes. We will eventually end up with inequality in our society. Northern Ireland was offering an example of how things could move forward, and the take-up of the child trust fund was an example of that.

The saving gateway account was a pilot scheme, and it never got as far as Northern Ireland—unfortunately. I was hoping that we could take advantage of the spin-offs for our constituents. There were certainly high expectations on the part of many, and that gave hope to a great many people. Again, the scheme was a savings account that involved the Government matching savers’ moneys, which encouraged people to be part of the process. Unfortunately, if the Bill receives its Second Reading, that scheme will also be knocked on the head, and that concerns me. I find it disconcerting that the saving gateway account should be banished to the dusty shelves somewhere, along with the opportunity that it could have given to those who need it most.

The health in pregnancy grant never was a good sum of money, but it did help those whom it was supposed to help. The hon. Member for Blackpool North and Cleveleys referred to the Ronseal test and the rhododendron test. The Ronseal test is whether something does what it says on the tin, and I have to say that the health in pregnancy grant did what it said on the tin. As a representative, I can honestly say that it did deliver.

[Sarah Newton (Truro and Falmouth) (Con)]

There is absolutely no doubt that women’s health during pregnancy is vital, but I really must take issue with the hon. Gentleman. The health in pregnancy grant was a universal benefit, so a mother of three children such as me could have received it and, in these extremely difficult financial times, we have to make difficult decisions to ensure that the available resources are targeted where they are most needed. The Government are really targeting support for families on lower incomes in a huge range of ways. Does the hon. Gentleman not agree that it is far better to target the limited resources at the families in the greatest need—

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order.

[Jim Shannon]

Thank you, Mr Deputy Speaker. I am sorry that the hon. Lady does not see this issue as clearly as I and many Members on the Opposition Benches see it. The grant did help people, because many of them came into my office and my advice centre, and I could see that they were benefiting from it. We have to target those people, but I do not believe that that will happen under the coalition’s proposals. Those who need help the most will be disadvantaged and will feel the pain from the changes more than anyone else. I understand that qualification for the grant was conditional on the involvement of a GP, a midwife, a welfare officer or a social worker.

[Dr McCrea]

Will my hon. Friend tease this out a little further? I am not sure what part of the coalition’s proposals targets the people the hon. Member for Truro and Falmouth (Sarah Newton) is talking about. The proposals deal with the removal of vital money, rather than with giving it to anyone.

[Jim Shannon]

I thank my hon. Friend for that intervention. We are clearly moving towards that, and if the Bill receives a Second Reading tonight, the opportunities will no longer be there for those who need them.

[Sarah Newton]

Will the hon. Gentleman give way?

[Jim Shannon]

As long as the intervention is shorter than the last one.

[Sarah Newton]

I would like to respond to the question from the hon. Member for South Antrim (Dr McCrea), because I can think of many clear ways of targeting people. We are absolutely committed to our investment in the national health service, to support for Sure Start centres and to the increased investment in district nursing through the Sure Start centres. As a result, a whole range of services will be available to pregnant mothers.

[Jim Shannon]

I thank the hon. Lady for her shorter intervention. I appreciate those opportunities for advancement, but the scheme we are discussing is targeted at a section of the community in which I can see its benefit. I have met many people who have been specifically targeted to receive the grant of £190. I dispute the view of those who think that many of the people who have received it should not have done so. That is certainly not my experience. Some coalition Members have referred to the grant as a gimmick, but I can tell them that it was not a gimmick to the people of Strangford whom I represent. It was something that they were able to use and take advantage of.

Household names such as the Royal College of Midwives have expressed disappointment at the decision to abolish the health in pregnancy grant, which, apart from providing pregnant women with much-needed financial support, provided an opportunity for midwives to communicate health advice to those women and their families. When such an astute body makes a statement like that, we need to take note. We cannot ignore it.

The National Childbirth Trust has also stated:

“At a time when families are trying to make ends meet, the Coalition Government has hit parents particularly hard.”

That is not Jim Shannon speaking; that is a quote from the NCT. Cutting pregnancy and maternity grants as well as cutting child benefits and tax credits will make things even more difficult for new parents and those wanting to start a family. I am very worried that parents and parents-to-be have been singled out unfairly. The coalition Government should stick to their commitment to making the UK more family friendly, but I believe that the Bill will change all that.

What will these measures mean for those who were destined to gain advantage for their health and their children’s health, and to stay out of the poverty trap? Some hon. Members have talked about the poverty trap today. The constituency that I represent has areas of deprivation, and I am sure that other Members are similarly disposed. I see my constituents regularly, and I have to tell the House that they will be disadvantaged by the proposals. I want to make it clear that I am here to represent them, and I hope that the Bill will be defeated. If it is, we will have done some good work here tonight.

I want the coalition Government to state exactly how they intend to stop even more people dropping into the poverty trap that I regularly see in my constituency. Will the Minister tell us what they are going to do to give hope to the people who will lose out as a result of the Bill? Are there any plans to fill that gap? Other Opposition Members have asked that question tonight. What is to be done to fill the gap, which has now widened? That question needs to be answered, and I am asking it on behalf of the people of Strangford and Northern Ireland whom I have the privilege of representing, and of the 123,000 people who took up the child trust fund and the 25,000 who benefited from the health in pregnancy grant. There are people out there who need that money and who benefit from it. I urge the coalition to think seriously about their proposals, because they will have a serious impact on the most vulnerable in society. That is something that I cannot support, and nor will I.

19:26

[George Freeman (Mid Norfolk) (Con)]

It is a pleasure to follow the hon. Member for Strangford (Jim Shannon). I am conscious of the number of Members who want to speak tonight, so I shall try to be brief. I want to make three key points. First, we need to draw breath and remind ourselves why we are having to take these measures. Secondly, I want to draw the House’s attention to some of what I believe to be the flawed thinking underlying the measures that we are withdrawing. Thirdly, I shall touch on the lack of support for them from a number of independent commentators whom one might have expected to be more vocal.

We heard a lot from Opposition Members earlier, accusing us in somewhat hysterical tones—it is nice that they have now calmed down a little—of unwarranted glee at cutting back from the most vulnerable in society. Those accusations almost reached the point of suggesting that that was what we had come into politics for, which is the most appalling and, frankly, shameful accusation, and one that they do not need to nod their heads at now.

It is worth reminding the House, and those listening in the Gallery, why the coalition is having to take these measures. It gives us no pleasure at all, but the truth is that we have inherited from Labour an historic crisis in our public finances. We have a debt of £700 billion, and debt interest would be set to rise to £67 billion a year if we had not set about tackling it, which these measures are part of. Our current debt interest payments are £120 million a day. Opposition Members need to bear all that in mind before they accuse the coalition of irresponsible measures. The irresponsibility is illustrated by the deficit that they bequeathed to us and to the future generations that we are all trying to help.

Without a plan to tackle the deficit, there would be a real risk that confidence in this country’s public finances would collapse, that international markets would lose confidence in our gilts, and that interest rates would start to rise. That would trigger the real catastrophe that we are trying to avoid. Everyone knows that we have to tackle the deficit. Surely no serious commentator, and no serious politician on the Opposition Benches, would suggest otherwise. It is simply disingenuous and mischievous to claim to be a serious party of government and then to scream foul when a responsible Government take the important measures to deal with the legacy that it has left us.

The flawed thinking behind some of the payments that the Bill covers can be seen as philosophical, economic and practical. First, as a number of speakers have highlighted, the measures do not target the poorest in society; they do not, in fact, do anything to tackle the really deep and challenging poverty traps into which many people fell through the complex layers of tax credits that the former Prime Minister insisted on imposing. They do nothing to undermine the dependency on the state, which all progressives in this House now seek to try to unravel. Anyone reading the work of Professor Giddens—new Labour’s philosopher-king—would understand that that is not an accident. In his seminal book—I commend it to Labour Members who have not read it—he sets about defining modern citizenship as a dependency on the state. It should be no surprise to us that the last Government took every opportunity they could to increase dependency on the state. Those of us in the coalition who want to release citizens from dependency would take issue with that philosophy.

Economically, there has been some flawed thinking. At a time when Labour Members were building up historic debt to £700 billion, some of my constituents might well have considered it something of a gimmick to set about giving back small amounts of money that the beneficiaries will not receive for 18 years in some form of apparent largesse when what people were really going to inherit was a historic deficit and all that went with it.

I defer to my hon. Friend the Member for Gloucester (Richard Graham) in respect of his earlier comments on the inefficiencies in management. I noticed in the Library briefing that management fees were running at £700 million, so it is odd to hear Labour Members defending putting money into the pockets of fund managers.

Finally, let me deal with the lack of support for these measures from independent commentators, whom we might have expected to be more vocal. When I went to the Library to find out what responses there had been to these cuts, I found two examples to which I would like to draw the House’s attention. Barnardo’s, commenting on the child poverty figures, said:

“We want to see child poverty reduced to 1.7 million by 2015—the missed 2010/11 target. The Government must now play catch-up. It can be done. Our Government has made the first step, by vowing to cut child tax credits to middle income families and the Child Trust Fund. To continue on the right foot all it has to do is invest that money saved in our country’s poorest children.”

The report of the Child Poverty Action Group—other Members have mentioned it—provides another example. Its briefing of 2005 pointed out that the child trust fund would not benefit children until they were 18, stating:

“Given ongoing problems with the administration of tax credits, and the much publicised inadequacies of the Social Fund, we believe it would be more appropriate and more effective to divert additional funds and administrative time and energies to improving elements of provision that are designed to support low income families rather than on a scheme which many commentators believe will disproportionately benefit higher income families.”

On the grounds of the nature of the deficit we have to deal with, the flawed thinking behind the policy and the lack of support for it, it seems to me that, far from being an hysterical over-reaction, these measures are perfectly reasonable and sensible, particularly in the light of the coalition’s commitment, set out in the Budget and the comprehensive spending review last week, to the retention of Sure Start, the introduction of the £7 billion pupil premium, the targeting of child benefit at the most needy families and tax credits. Some Members have already referred to them.

[Alison McGovern]

Will the hon. Gentleman give way?

[George Freeman]

I am just wrapping up.

Also important is the Institute for Fiscal Studies’ analysis, showing the Budget measures will not increase child poverty. Far from being irresponsible, I suggest to the House and to people more widely, that these are regrettable, but responsible, measures from a Government who take seriously their responsibilities to tackle the deficit left by the previous Government.

19:33

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

This is an incredibly serious debate and I would like to address what I believe are important points raised on both sides of the House. I shall deal with all three elements of the Bill—the health in pregnancy grant, the child trust fund and the saving gateway proposals—in the context of what I understand to be important drivers for this Government, such as reducing inequalities, improving social mobility and improving child outcomes. I shall also consider the extent to which the proposals meet the Government’s own fairness test.

I start with the proposal to abolish the health in pregnancy grant. There is considerable evidence to show the impact of poor maternal nutrition—during pregnancy and, importantly, prior to conception—on low birth weight, and the impact of that on a series of outcomes for child development down the line, including educational attainment and health outcomes. I certainly agree with the Conservative Members who said that a grant in the seventh month of pregnancy was not sufficiently early to achieve everything we would want to improve the well-being of pregnant women and their unborn children.

For women on low incomes, affording a healthy diet is a challenge. Indeed, women reliant on safety net benefits will, if they are under 25, have an income of £51.85 a week; and if they are over 25, £65.45 a week. Those amounts are sufficient to meet the minimum income standard determined by the Joseph Rowntree Foundation—£44 a week in order to afford a healthy diet. However, once we take into account other expenditure that has to be met out of those benefit payments—fuel, clothes, travel, personal items, insurance, utilities and so forth—it means in practice that women conceiving and bearing children on benefits could find themselves with as little as £10 a week to spend on food. Clearly, none of us could eat a healthy diet on that.

It is right, as Opposition Members have repeatedly pointed out, that despite its perhaps unfortunate name, the health in pregnancy grant has the potential to achieve much more than simply help with a healthy diet. It helps to meet a number of the costs associated with preparing for and coping with the arrival of a new baby. Obviously, parents across the income spectrum will be grateful for any help. Although I was rather pooh-poohed by the Minister when I suggested that such a grant is likely to be spent pretty readily so it will also help the economy, there is lots of evidence to show that if we give money to parents at a time when their costs rise, they will go out and spend it quickly—they need to; there are items that they must buy. This will make a modest contribution to our economic regeneration, although that was hardly the overriding reason for introducing the grant in the first place.

[Alison McGovern]

Does my hon. Friend agree that this is similar to other kinds of grant such as the winter fuel payment, which we award in cash terms to get people through what is an expensive time? It is most efficient not to cross-question what it is actually spent on, but these grants are important in recognising that people go through difficult and expensive times.

[Kate Green]

That is absolutely right on a number of fronts. First, as my hon. Friend says, this sort of grant is designed to help with specific expensive times in the course of people’s lives. It is important to recognise that specifying what it gets spent on is not necessary to ensure that it does good. In fact, there is a lot of evidence to show that if we give more money to parents, particularly to mothers, they will spend it on things that will help their kids.

I understand the concerns of Government Members about universal benefits, but this is a universal benefit. It goes to people who are financially better off as well as to those in greater need. As Opposition Members have repeatedly sought to explain, universal benefits are the most effective for reaching the poorest. They are the easiest to administer and the easiest to claim; there are no complicated cliff edges or recalculations. As such, I believe it is important to retain a range of universal benefits within the totality of support for families with children. I therefore think that the health in pregnancy grant has a useful role to play.

Even if we accept for a moment Government Members’ concerns that the benefit has been poorly targeted, that is hardly a case for scrapping it outright, especially when basic benefits are too low for the poorest women to be able to afford to eat healthily before their child is born. Surely, far from seeking to abolish the benefit, an ambitious Government who were keen to improve the outcomes of the poorest families and children would want to extend its scope or consider other ways of improving the adequacy of out-of-work benefits.

[George Freeman]

I am enjoying the hon. Lady’s speech and I acknowledge her expertise. In recommending the extension of the benefit, however, will she explain where she would get the money from?

[Kate Green]

There is work to be done to consider the balance of taxation versus spending cuts, as Labour Members have repeatedly pointed out. As for where the money is taken from, it is notable that the coalition Government, whether by accident or design—I suspect that it is more by accident, but I give them the benefit of the doubt—have taken more from women and children. An evening up of the way in which the spending axe fell might provide more scope.

Far from seeking to improve the financial position of some of the poorest in society—those who are reliant on safety-net benefits—some of the coalition’s measures will make matters worse: the changes to housing benefit; the VAT rise, which will reduce the spending power of the poorest; and the plans to link safety-net benefits to the consumer prices index, which will, over time, significantly reduce the value of those benefits to low-income families, and will therefore have an impact on the disposable incomes of the poorest women before conception, during pregnancy and after birth. I urge Government Members to think about how they would address that.

[Chris Williamson (Derby North) (Lab)]

Does my hon. Friend agree that the policies pursued by the Con-Dem coalition will lead at best to the economy growing slowly, and at worst to a double-dip recession, which will result in a much lower income tax take for the Exchequer? Our proposals to improve and support growth in the economy would generate the tax revenues that would enable us to fund schemes such as the health in pregnancy grant.

[Kate Green]

Absolutely. Although you will not want this evening’s debate to extend into the whole range of economic policy, Mr Deputy Speaker, clearly, a strategy for growth and increasing tax receipts will be vital to protect the poorest families.

[Sarah Newton]

I, too, appreciate the hon. Lady’s expertise, but I must point her to the growth in the UK economy, which I hope she is reading about in the newspapers. We should celebrate the fact that we have the second-fastest growth rate in the G20.

[Kate Green]

I very much welcome the growth in the UK economy in the third quarter of this year, but, with respect, it is early days for Government Members to take all the credit for that. I suspect that it was the fiscal stimulus put into the economy by the previous Chancellor of the Exchequer that underpinned the ability of businesses to continue to hire and of people to stay in work. All Labour Members genuinely hope that that long tail effect will continue, but we feel that it is at risk.

On the savings aspects of the Bill, I cannot understand the Government’s logic, given their stated ambitions to reduce inequality and to encourage a savings habit and, in the case of the Secretary of State for Work and Pensions, the strong focus on helping people to reduce and stay out of debt. The child trust fund and saving gateway have helped low-income savers to acquire a savings habit and have assisted their money management. As child poverty has fallen since 2005, the child poverty impact of the measures is beside the point, because they have not diverted money from successful strategies to tackle child poverty, but are in addition to those strategies. They were intended to take on board the evidence of the protective effect of having an asset, which is especially important in social mobility.

[Cathy Jamieson]

Does my hon. Friend agree it is vital that looked-after children have that asset built? Given that their parents are not in a position to do that, we have a responsibility, as corporate parents, to find another way, if the Government will not reinstate child trust funds.

[Kate Green]

I hope that Conservative Members and the Minister will hear that contribution in the spirit in which we all feel it. This country has a poor record on outcomes for looked-after children, who enter adult life singularly poorly provided for financially. The child trust fund was a small step towards beginning to rectify that. As my hon. Friend says—and I hope the Government heed this—if the child trust fund is no longer to be the mechanism through which looked-after children are given some sort of nest egg with which to embark on adult life, I hope that Ministers will look for another way to secure the financial futures of such children. It is not sufficient to say that we will improve education, health and Sure Start support, important though those are. Plenty of evidence shows the importance for young people, especially those from disadvantaged backgrounds—and looked-after young people most of all—of having a financial asset behind them.

The hon. Member for Gloucester (Richard Graham), who I am sorry is no longer in the Chamber, cited the briefing that some Members had received from the Save Child Savings alliance. I was struck by the numbers he shared with us: 4.5 million child trust fund accounts are open; £2 billion is under management; and £22 million a month is saved in those funds. That is a lot of money being saved and set aside for our children’s futures. I strongly urge the Government to take note of that success. The vast majority of families saving are on modest, medium or lower incomes, certainly of less than £50,000, and many of them on much less. The hon. Gentleman mentioned that, I think, 24% of families were not saving at all. He is right to draw attention to the position of those families, but I question what they will save with instead, if we remove the child trust fund. If the Government do not save on behalf of the poorest children, I very much doubt that a tax break, for families who probably do not pay tax anyway, will suddenly magic up savings for the poorest children. I ask the Government to address that point.

The child trust fund is well targeted for its purpose, which is to deliver an asset to young people as they start out on adult life. Better-off families can afford to support their children with university fees, renting their first flat, buying their first car, perhaps starting a business, having a gap year—all markers of social stability, and therefore at the heart of what the Government rightly want young people from low-income backgrounds to be able to participate in. I am genuinely at a loss to understand why a Government who repeatedly, and unjustly, lambast Labour’s record in relation to social mobility and inequality, should totally dismantle a savings vehicle that has the potential to reduce inequalities, and instead propose a savings vehicle that will widen those inequalities by benefiting only those who are better off.

I am just as puzzled by the Government’s attitude to the saving gateway. Pilots in different parts of the country have shown that, coupled with outreach and money advice, it helped to support a savings habit, provided low-income families with a cushion enabling them to cope with crises, allowed them to build up modest assets over time, and made possible additional savings that would not have been possible otherwise.

I am surprised—more than surprised; indeed, I am shocked—that a Government who are happy to extend tax breaks to savers and to maintain them on ISA savings, pension contributions and inheritance tax will not provide support to boost the savings of the poorest. I ask Ministers how that can possibly be fair.

[Alison McGovern]

I thank my hon. Friend for giving way again. She is making a comprehensive and excellent speech. Does she agree that what the financial services sector needs now are additional deposits, and that offering tax breaks to those who are already saving will not be half as effective as continuing programmes which, according to all the evidence, produced those additional deposits and improved the savings culture?

[Kate Green]

I think that the Government should be very wary about dismantling a scheme that has generated additional savings, for exactly the reason that my hon. Friend has given.

What concerns me most is the impact of the Bill on the Government’s commitment to reducing inequality. We already have a significantly unequal distribution of assets. Up to 20% of households have no assets at all. The highest-earning 10% hold half the assets, and two thirds of households have savings of less than £3,000. I accept that we are not handing on a proud record to the incoming Government, but I would have expected them to conduct a rigorous equality impact assessment of their own proposals as a result of their determination to do a little better than that.

The equality impact assessment that accompanies the Bill is thin in the extreme. It fails in any way to recognise the lower earning power in the labour market of women, disabled people and members of ethnic minorities: a lower earning power that translates into a lesser ability to set money aside in savings, and ultimately, therefore, into lower asset holding. Its analysis of the saving habits of members of ethnic minorities is scanty, although research from the Runnymede Trust would have informed the Government quite quickly that at least 60% of Asian and black British families have no savings at all. The fact that that is twice the number of white households in the same position should concern us greatly.

[Sarah Newton]

I am just as passionate about the inequalities in our country as Labour Members, and I am sure that I speak for all Conservative Members. Our drive to enter politics was prompted by a wish to end the vast inequalities that have arisen over the past decade. Does the hon. Lady agree that the best way to help people to help themselves in that regard is through education and employment?

[Kate Green]

It is not a case of either/or. We should be doing everything possible. We should be maximising families’ financial stability and security through education, employment and a redistribution of income and wealth.

One misconception should be properly analysed. It is absolutely not the case that inequality rose exponentially under Labour. In fact, it more or less flatlined. It rose a bit during the last couple of years of Labour government, but according to the Institute for Fiscal Studies—admittedly not the Government’s favourite think tank—without the measures taken by Labour between 1997 and 2010, given the trends experienced under the previous Conservative Government, it would have been very much worse.

The hon. Lady and other Members on the Government Benches are right to say that we are all anxious to reduce inequalities; what I do not understand is how on earth the Government think that proposals of this kind will do that. How on earth do they think that removing the saving gateway will address the gender inequality involved in the fact that women have 40% less in savings than men? How on earth do they think that removing the child trust fund and the saving gateway—benefits that provided extra money or extra access for people with disabilities—will deal with the inequality of disabled people?

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

The hon. Lady asks how on earth the Bill will reduce inequality. It will do so by removing universal benefits and replacing them with targeted benefits.

[Kate Green]

First, let me remind the hon. Gentleman of what I said earlier about the effectiveness of universal benefits in reaching the poorest. Secondly, even if we accept the hon. Gentleman’s contention on its own terms, it does not provide a case for abolishing those benefits. It may provide a case for retaining the existing structures and targeting them for a time. Obviously I do not want that to happen—I want us to maintain as much universal support as we can—but at the very least I ask Government Members why they want to rip the whole thing up and throw it out, rather than trying to target it more effectively.

[John Hemming]

rose—

[Kate Green]

I will not give way, because I am about to end my speech.

I urge the Government to reconsider their proposal to abolish these benefits. I ask them to examine ways in which they might be able to maintain structures that have been effective, and have the potential to continue to be effective, in supporting the poorest families in the immediate future and—this is also important—in the longer term. Unless they come up with credible alternatives to reduce and remove income and wealth inequalities, I will not support their proposals, and I will not support the Second Reading of the Bill.

[Several hon. Members]

rose—

[Mr Deputy Speaker (Mr Nigel Evans)]

Order. As hon. Members will have just observed, a number wish to speak in the debate. The winding-up speeches will begin at 9.40 pm. If everyone is to have an opportunity to speak—and I know that a number of Members have been present throughout the debate—I must ask those whom I call to exercise time restraint so that their colleagues can contribute as well.

19:56

[Jacob Rees-Mogg (North East Somerset) (Con)]

Thank you for calling me, Mr Deputy Speaker. I feel slightly guilty that you have had to do so three times in almost as many days. I assure you that I am not modelling myself on Psmith—with a silent “P”—and his haunting of John Bickersdyke, which you will remember from the book “Psmith in the City”. I am really not trying to do that, and I will be as brief as I can while discussing this important Bill.

Benjamin Disraeli famously said that the job of the Opposition was to oppose, and we have seen that today. Indeed, we have seen it all afternoon. We have seen rather specious opposition to the Bill. Whenever the subject of where the money is to come from arises, there is no answer. VAT should not go up to pay for our bills; benefits should not be cut to pay for our bills; so we must spend, and we must have no increase in taxation. What happens to the nation’s finances at that point? What happens to the national debt? What happens to the deficit? We go down the sorry road towards bankruptcy. That really is what Opposition Members have been arguing for. It is the “do nothing” school; the argument that, like Nero, we should fiddle while Rome burns.

[Chris Williamson]

Will the hon. Gentleman give way?

[Jacob Rees-Mogg]

I should be delighted.

[Chris Williamson]

Will the hon. Gentleman at least acknowledge that before the economic downturn, the debt ratio in this country was lower than the debt ratio that the Labour Government inherited in 1997? The fact is that it was the Labour Government who introduced measures to keep people in their homes and in employment, and to prevent the appalling circumstances to which ordinary working people were subject in the 1980s when the hon. Gentleman’s party cast people aside.

[Jacob Rees-Mogg]

The hon. Gentleman’s point is fundamentally flawed. In 1997, the socialist Government decided to stick to Conservative spending targets. That is the one sensible decision that they made. It is not surprising that they managed to reduce the public debt by doing what the Conservatives had said that they would do. As for the deficit that built up before the crisis hit, there was a structural deficit—probably equivalent to 7% or 8% of GDP—which had resulted from excessive and extravagant expenditure. That is the nub of what we are debating today. We need to examine these benefits, and establish whether they are right in principle.

I will declare an interest. My three children have been the fortunate beneficiaries of £250 each—£250 spent extraordinarily well, Members may think, beneficially and wisely, so that in 18 years’ time my children will have something to spend when they are a little older. Is this really a sensible use of taxpayers’ money? It is too small a sum to make a difference even with the benefits of compound interest, yet too large a sum for our public finances to stand when aggregated across the whole of the economy and the total number of children who will be born. It is a wrong benefit, which is rightly being abolished. To contradict the hon. Member for Stretford and Urmston (Kate Green), who spoke before me, it is also a benefit that cannot be spent for 18 years; it will be of no economic benefit until the child is 18.

[Kate Green]

I apologise if I have misled the hon. Gentleman, but what I said was that the health in pregnancy grant would be spent immediately. I absolutely accept that the child trust fund moneys are locked up until the child reaches the age of 18.

[Jacob Rees-Mogg]

I thank the hon. Lady for that useful clarification.

The health in pregnancy benefit is paid to ladies towards the end of their pregnancy so that they can eat properly. Again, my wife was entitled to it. I have in the past been mobbed up somewhat on nannies and issues relating to that subject, but the one type of nanny of which I most firmly disapprove is the nanny state. This patronising approach, saying to these ladies, “You ought to eat your greens and here’s some money so you can do so,” is not what government is about. The Government are here to allow people to lead their lives as freely as they possibly may, without interference from the state while also providing a safety net for those who fall on hard times, not to tell people how to lead their lives, at the expense of the taxpayer and the economy.

[Catherine McKinnell]

Does the hon. Gentleman agree that a “lady” of very low income who finds herself pregnant and expecting her baby in three months’ time will have increased expenditure relating to both the pregnancy and the upcoming birth?

[Jacob Rees-Mogg]

The hon. Lady makes a brilliant and inspired point with which I completely agree, and it is therefore wise to ensure that such benefits as there are are directed to the people who need them, not wasted on people who do not need them. [Interruption.] If the hon. Member for Nottingham East (Chris Leslie) wants to say something, I am more than happy to give way.

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

The Bill does not achieve what the hon. Gentleman wants, however. While I am on my feet, may I ask him whether he knows how many children in the United Kingdom are born with spina bifida each year, possibly as a result of a folic acid deficiency?

[Jacob Rees-Mogg]

The hon. Gentleman says the Bill does not say where the money is going to be spent, but that is an absurd point to make because the public finances are in such a weak condition that, at this moment, money needs to be saved. The first principle for the Government—their first ambition and intention—must be to get the finances of this country on to a stable footing so that they can then, with economic growth, ensure that the money is there to help people in the future.

[Sarah Newton]

I quite understand that the hon. Member for Nottingham East (Chris Leslie) might not know about this—his partner may never have had a child—but folic acid should be taken before and during pregnancy to avoid the dreadful condition he mentioned, and all the supplements are available on the NHS.

[Jacob Rees-Mogg]

My hon. Friend makes an extraordinarily good and important point. The payment of this £190 comes too late in the process to be of benefit to people whose children may be at risk of spina bifida.

[Chris Leslie]

I would be surprised if many mothers—I certainly include my wife in this, when we were having our daughter—were able to discover that folic acid is available on the NHS. A multivitamin and folic acid supplement costs about £10, I think. Do the hon. Gentleman and the hon. Lady really think it is absolutely essential that these women having children should potentially be deprived of help to pay for that folic acid supplement because of this deficit reduction strategy?

[Jacob Rees-Mogg]

As my hon. Friend the Member for Truro and Falmouth (Sarah Newton) wonderfully and accurately pointed out, the hon. Gentleman had got the wrong part of the pregnancy; we have to go back, not forward.

[Sarah Newton]

The whole issue of maternal health is incredibly important. The problem with this benefit is that how the mum is to spend the money is completely unspecified. There is absolutely no guarantee whatever that the money will be spent in the way that has been suggested. It is far better, therefore, that a mum is supported through comprehensive care in the NHS so that she is informed of the choices and provided with the resources to enable her and her baby to thrive.

[Jacob Rees-Mogg]

My hon. Friend is absolutely right and spot on. That is a most helpful intervention. There is no point in giving money late in the day to everybody—those who need it and those who do not need it alike—for an unspecified purpose when other ways of spending money may prove to be more useful.

[Kerry McCarthy (Bristol East) (Lab)]

The hon. Gentleman is saying that benefits should be targeted rather than universal and that they should be for a very specific purpose—that the state should dictate what the benefit money is spent on, which contradicts what he said earlier about the nanny state. Given his support for targeting benefits, how does he justify the Government’s continued support for the winter fuel allowance?

[Jacob Rees-Mogg]

The winter fuel allowance goes to the elderly, many of whom will have paid full national insurance contributions, and it is therefore in some sense a recompense for what they have paid in. I think that to look after the old in society is an important and virtuous thing to do. It is right to give that help so that people can be warm in their homes, but we are talking at present about £250 for children when they are born that will give them a pitiful amount a few years later. We are talking about £190 given to every woman who is going to have a baby for no necessary benefit to her because she may not need the money or it may be received too late for her to address some of the problems referred to earlier. Those two benefits are therefore unnecessary and wrong.

The third benefit is the Government’s matching of personal savings, and there is a misconception here. Saving from a deficit is a dis-saving to the economy because there are costs associated with allocating that saving. To put that more simply, if someone borrows money from one account to put into another account they will pay a higher rate of interest on their borrowings than they will receive on their savings so, net, the country is dis-saving by topping up savings accounts. Opposition Members are therefore wrong to say that this is an encouragement to saving.

We need to look at all that is being done in the broader context. We have this phenomenal deficit—our highest peacetime deficit—which the Government have, in a workmanlike and serious-minded way, decided to tackle. They have decided to bring the deficit down so that we may have the conditions for economic growth. The essence of good government and of a sensible Treasury policy is to ensure that there are the conditions where business can thrive, jobs can be created and money can cascade through the economy. That is what really lifts people out of—

[Chris Williamson]

Will the hon. Gentleman give way?

[Jacob Rees-Mogg]

Of course I will.

[Chris Williamson]

The hon. Gentleman referred to job creation. Will he therefore comment on the fact that almost 500,000 jobs will go in the public sector as a direct consequence of the comprehensive spending review, followed by a further 500,000 jobs at least to go in the private sector? How does the hon. Gentleman square that circle?

[Jacob Rees-Mogg]

I am not going to try to square circles, which I believe is not possible, but those figures are fundamentally contentious, and it is also worth bearing in mind that outside the private sector the country has no income. Every penny spent by the Government either has to be raised in taxation or borrowed.

[Chris Williamson]

Is the hon. Gentleman therefore contesting the figures of the Office for Budget Responsibility?

[Jacob Rees-Mogg]

The hon. Gentleman knows the figures are contentious because he cited the figure of how many jobs will go in the private sector, but he is ignoring the jobs that will be created. We find ourselves in the extraordinary situation that 700,000 public sector jobs were created by the last Government without the money to pay for it. We cannot run a system under which we employ people and pay them what are essentially tokens because we have no real money. Are we to follow California and pay servants of the state IOUs because there is no proper currency with which to pay them? Are we going to so debauch our currency and print even more of it that there are no funds with which to pay people? Are we going to destroy our gilt market so that the Government are unable to raise money? No, Her Majesty’s Government have been brave, courageous and right, and they have taken tough decisions. They have taken decisions mocked by Labour Members because they dared not do this; they talked quietly in secret rooms about how much they were going to cut. These cuts then get leaked in the newspapers because Labour Members dare not come boldly to this House to say what they want to do.

[Chris Williamson]

I beg your pardon, Mr Deputy Speaker, and that of the House for continuing to intervene on the hon. Gentleman, but I cannot allow him to get away with his remarks. I wonder whether he studied history at all when he went to school and university, and whether he would care to ponder on what happened in the 1930s in America, when its plans put people back into work, compared with what happened then in this country. The prospectus that is being followed by this Administration was similar to what was done in the 1930s and saw mass unemployment.

[Jacob Rees-Mogg]

I am grateful to the hon. Gentleman for his kind and helpful intervention, because I happen to have with me some economic data from the 1930s. I believe they will prove helpful because they are from the United Kingdom. It is a common error—if I may say so, it is a schoolboy error—to confuse the situation in the United Kingdom with that in the United States in that decade. In 1931, public spending in the United Kingdom was £1.174 billion, a figure that had been cut to £1.061 billion by 1934. Unemployment peaked in 1932 and gross domestic product grew from £4.399 billion in 1931 to £4.813 billion in 1934. So there was a percentage cut of nine-odd per cent. in public spending accompanied by a 9% rise in GDP, and unemployment peaked long before the cut in public spending was at its maximum point.

So in fact this Government are rightly following what the British Government did in the 1930s, and the key thing, which I will give credit to the Labour Government for, was coming off the gold standard. In 1931, having an active monetary policy meant that the economy could grow even while public spending was being cut. Her Majesty’s previous Government, the one that she dispensed with on 6 May or thereabouts, allowed the pound to fall so much and allowed the Bank of England to ease quantitatively—or print money, to put it in less jargonistic terms—that the increased money supply created the conditions where this Government can and must cut fiscally, and can have economic growth and falling unemployment. We are already seeing some of the fruits of that coming through in the figures announced today.

[Gregg McClymont]

I was listening closely to the hon. Gentleman’s comments. Given what he was saying, will he support a further round of quantitative easing if that is necessary to stimulate the economy, given the possibility of a prolonged—

[Mr Deputy Speaker (Mr Nigel Evans)]

Order. This is going rather wide of the mark and now may be an appropriate time to remind colleagues that we have the wind-ups at 9.40 pm. I would be grateful if Mr Rees-Mogg could show some restraint, as well as everybody else that follows.

[Jacob Rees-Mogg]

I would have finished by now, but I have taken a number of interventions, which it is a privilege to do. [Interruption.] It is a privilege, because the interventions are very interesting and they allow us to get to the nub of this difficult matter. Of course it is not popular to take something away. Of course it is easy to stand up raging about £190 being taken away from women who are about to be pushing prams. Of course the decision to take £250 away from their children is a hard one, but it is right, because the country cannot afford this. If the economy is to grow, we must have sound public finances. If that happens and if people can keep their own money, rather than have it taken from one pocket by the Government to be put into another pocket by another Department of the same Government, we can get economic growth and we can see what we saw in the 1980s, when the economy boomed, individuals got increasingly prosperous and Britain was back among the top world nations. That is what I want to see, that is what the Government are doing and that is why I am thrilled to be supporting the Bill.

20:10

[Simon Danczuk (Rochdale) (Lab)]

I wish to turn my attention to the child trust fund, in particular, and to start by quoting the Chancellor. In a speech made just 12 months ago to the Conservative party conference, he said:

“We should continue paying them to the poorest families who often have no savings, and encourage them to use them more”.

As we have heard tonight from Conservative Members, many of them believe that the benefits we are discussing tonight should not be universal and that we should target them much more closely. That has been a common theme throughout this evening’s debate.

Only the Liberal Democrats have never really been in favour of the child trust fund. They have continually proposed to scrap it, although they have not had the decency to turn up to this debate in number. So we have to ask ourselves what the situation really is. Who is the driving force in the coalition Government in terms of punishing the poor? Is it the Conservatives, who want to target their benefits more closely, as we have heard today, or is it the Liberal Democrats, who are happy and enthusiastic about increasing VAT, raising tuition fees and cutting the child trust fund?

The reality of the Chancellor’s logic in scrapping the child trust fund is that the most vulnerable will be hit hardest. I can tell colleagues that the child trust fund is neglected in terms of the attention it gets, as has been shown by Conservative Members during today’s debate. The fund is a very important tool to encourage saving, particularly for the less well-off. I know that from speaking to parents across my constituency, particularly mothers. It has continually encouraged them to start saving on behalf of their children and it has started them thinking about the future for their children. We cannot underestimate the importance of the child trust fund in that regard. Although I readily accept that what children will receive is between £500 and £1,000, which is never going to pull people out of poverty in a short time, there is absolutely no doubt that it has been a catalyst to get people to start saving. As has been said, it has also encouraged families and friends to start contributing to the savings of young children.

I have described the trust fund as one of the best hand-ups, rather than handouts. As has been said, the Save Child Savings alliance has described the child trust fund as

“the most successful saving scheme ever.”

There is irony in the Government cutting the child trust fund at this time, because one of the key reasons for its introduction was to encourage people to engage with financial institutions. People are suspicious of such institutions and, if ever there were a time when we needed to encourage them, it is certainly now. Yet, the Government are scrapping this initiative and the other initiatives dealt with in this Bill, which actually encourage that engagement.

The Government’s decision to scrap the child trust fund will, in effect, create a situation where—we heard about this just before I spoke—the elite in society will be continually pumping and stashing thousands of pounds into the personal, private child trust funds that many of the wealthy already have. That dichotomy will continue. What we will have in poorer communities—in parts of Rochdale—is poor families who will be unable to get that start in life for their children, with no £250 or £500 to kick-start their saving. Although the wealthy will continue to have their opportunities in life, the poorer and more vulnerable will not have those opportunities. Come 18, when the children from the wealthier families have the chance to have a good time at university and have a better opportunity to go off on a gap year, to buy a car or take driving lessons, which is all well and good, the reality for the poorer people and the more vulnerable, whom we often see in Rochdale, is that because of these cuts, which could have been avoided, they will not have those opportunities. They are being taken away from them by the Conservatives, ably assisted—especially in this instance—by the Liberal Democrats.

The contrast could not be more obvious. In many respects, the axing of the child trust fund defines the differences between the Labour Government and the coalition Government. The Labour Government were intent on providing a hand-up and not a handout, whereas the coalition Government are not prepared to provide either a hand-up or a handout.

[Harriett Baldwin (West Worcestershire) (Con)]

I am trying to follow the intellectual train of the hon. Gentleman’s very powerfully expressed argument. I noted that it had something to do with targeting and Liberal Democrats, but perhaps I am picking up the wrong sequence of words. He started with an eloquent argument in favour of universal benefits. Does that mean that he is in favour of continuing to give these grants to my hon. Friend the Member for North East Somerset (Jacob Rees-Mogg)?

[Simon Danczuk]

I will be quite clear about the position I take in that regard. Let me clarify my point: I was stating that many Conservatives have identified tonight that they do not believe in universal benefits and that they are prepared to have more targeted benefits. If that is the case, why did they not put that in the Bill? That is the reality. My point is that the only people in the coalition Government who want to scrap the benefits altogether are the Liberal Democrats, so is it the Liberal Democrats who are pushing the Conservatives more to the right, towards scrapping benefits completely?

This type of Bill, like the CSR, will confirm to the people of Rochdale that the coalition Government are not on the side of fairness, but are on the side of the wealthy.

20:23

[Alex Cunningham (Stockton North) (Lab)]

Despite what we have heard from those on the Government Benches tonight, it is still very clear that with today’s Bill, the coalition will deliver yet another blow to hard-working families and the most vulnerable.

The Prime Minister said he wanted this Government to be

“the most family friendly Government we’ve ever had in this country”.

So, I want to know why the coalition is again hitting hardest families with children. That is not my analysis or the analysis of my colleagues on the shadow Front Bench, but the conclusion of the Institute for Fiscal Studies. The Deputy Prime Minister spent last week attacking that much respected think-tank for daring to tell the truth about the coalition’s damaging cuts, describing its methods of measuring the fairness of the controversial spending review as

“distorted and a complete nonsense”—

but that is what is nonsense. The Deputy Prime Minister argued that the rich will pay the most as a result of the spending review and that anyone who argues otherwise is “frightening people”.

Perhaps I could refer the Deputy Prime Minister and other Ministers not to the latest IFS report but to the Christian Bible and the story of the widow’s mite. It will be familiar to many, and tells the story of a widow quietly giving her last mite to the temple while a rich man makes a great show of handing over a considerable sum, but a sum that is insignificant as part of his overall wealth. It seems that the poor in our country need to give their all and stay quiet, too.

Although the rich of this country might pay more both in terms of actual cash and as a percentage of their overall income than those on the lowest incomes, their pain will be negligible in comparison with that of a family in my constituency who might lose £10 or £20 a week, which could be the difference between feeding themselves properly and missing meals. I doubt that they will be quiet, like that widow, when they have nothing left and still have mouths to fill.

Hard-working families in my constituency do not need Labour MPs or the Institute for Fiscal Studies to frighten them; they can see for themselves the damage that the coalition Government are doing. They remember how Teesside suffered under the last Tory Government and they are frightened that the Government are cutting harder and faster than we have ever seen.

Others have highlighted these points. We have heard about the cuts to child benefit, cuts to housing benefit, the scrapping of the education maintenance allowance, and the cut to the child care element of working tax credit that equates to a loss of up to £1,560 per year for families who are already struggling with the burden of extortionate child care costs.

[Harriett Baldwin]

Does the hon. Gentleman agree with the helpful suggestion made by my hon. Friend the Member for North East Somerset (Jacob Rees-Mogg) about the fact that these grants have been going to people like him? He argued for a change in favour of more fiscal rectitude, which would mean that children growing up in the constituency of the hon. Member for Stockton North (Alex Cunningham) would not have such a burden of borrowing in the future.

[Alex Cunningham]

I think that the point that the hon. Member for North East Somerset (Jacob Rees-Mogg) made was that perhaps families such as his do not need that sort of income. If he wants to forgo it, that is all well and good, but there are hard-working families in my community that need that money.

Let us add to all that the impact of the 27% cuts on local authorities and the effect that will have on services, including initiatives such as breakfast clubs, and again we see the family under attack. In the north-east, we already know that family dependency on benefits will grow, with some 43,000 public and private sector jobs lost over the next few years. People will see few jobs for them to chase as unemployment undoubtedly soars.

Today, the Government attack again. I object to the scrapping of both the child trust fund and the saving gateway and I believe the Government are making a big mistake by getting rid of them.

[Gavin Williamson]

The hon. Gentleman strikes me as a very enlightened individual, and I am sure that he is very aware that every Government have to make difficult choices. If he were to keep these areas of expenditure going to fund the benefit, what areas of Government expenditure would he cut?

[Alex Cunningham]

Personally, I would raise taxes in order to ensure that we could maintain this provision, and the bankers are a good place for us to start.

[Gavin Williamson]

Will the hon. Gentleman give way?

[Alex Cunningham]

No, I will not.

Both the child trust fund and the saving gateway were Labour initiatives, put in place by a party that understands the importance of fostering a culture of saving. Asset-based welfare can make a huge difference to the opportunities of the least well off in this country who often do not have access to the resources that many others are lucky enough to have, whether through inheritance or the generosity of family or because they recognise the importance of saving a little of their salary each and every month for a rainy day. The saving gateway aimed to encourage those from low-income households who do not save, for whatever reason, by promising the incentive of a Government contribution of 50p for every pound saved over the two-year life of the account. It had been trialled, and was due to be rolled out across the country in July.

We will not see the difference that the saving gateway would have made to thousands of low-income families at the relatively tiny cost to the Government of £100 million a year. The response to the trials was largely positive—one pilot saw the number of people saving rise from 16% to nearly 80%. In total, more than 22,000 people took part in two successful pilots, achieving more than £15 million in savings. Those people demonstrated that the scheme could generate both new savers and new saving, because individuals continued to save beyond the end of their gateway accounts.

Encouraging people to save promotes self-reliance and stability, allows long-term planning and provides security from sudden financial shocks. Saving just a few pounds a month makes a person feel in greater control of their life, and it can be transformative and provide a psychological boost. The difference that that can make to families and their quality of life should not be underestimated.

[Sarah Newton]

You are making a very powerful speech for us this evening, and I completely agree with you about the importance of savings and of encouraging a savings culture. However, I am rather disappointed by the glib response to my hon. Friend the Member for South Staffordshire (Gavin Williamson), who asked how Labour Members would pay for those benefits. Every time that question is raised, Labour Members say that we should tax the rich. What calculation has the hon. Gentleman made of the effect of increasing taxes to 70%, 80% or 90%? Is that where you would like to go? And what estimation—

[Mr Speaker]

Order. I gently say to the hon. Lady, first, that I am not going anywhere—the debate goes through the Chair—and, secondly, that interventions from now on must be short, because there is a lot of pressure on time and several hon. Members want to contribute.

[Alex Cunningham]

I have never had a problem with taxing the rich a little bit more. If that means a penny on income tax, I would be fine with it, although I do not know what encouragement I would get from my Front Benchers.

[Gavin Williamson]

Will the hon. Gentleman give way?

[Alex Cunningham]

No, I will not. We need to raise taxes and target the results at the poorest people.

I hoped that the saving gateway would squeeze some of the doorstep lenders out of low-income communities, which is an issue close to my heart. Those companies charge outrageous interest rates, and if people had some money saved for a rainy day, such monsters would see their customer base shrink.

I also want to speak out in defence of the child trust fund, which acts as an incentive to save by adding to a Government contribution of either £250 or £500 at birth depending on a family’s income. The child trust fund was well established, having been introduced for all children born since September 2002. At a cost of around £500 million a year, including additional contributions when a child reaches the age of seven, this universal yet progressive fund ensures that all children, regardless of their family income, have a pot of money that they can access at the age of 18.

According to the Save Child Savings alliance, some industry data suggest that the child trust fund has seen the number of people saving for their children’s futures almost treble. More than £2 billion is currently being held in child trust funds. That form of asset welfare opens doors to young adults, particularly those from low-income families. No young person has yet benefited from this fund—the first recipients are just eight years old today—but I would have hoped that when they can start accessing it in 10 years’ time, that money would go some way to improving social mobility, which is an issue that some hon. Members highlighted earlier.

A policy that spreads wealth to the asset poor should be backed by anyone who is dismayed by the lack of social mobility in the UK today. Yes, education plays a major role in tackling that problem, but so do assets, which is something that the Liberal Democrats have failed to address in recent years. The Deputy Prime Minister spent some of the summer discussing the Government’s programme for social mobility, but this measure goes against it. The child trust fund was one way in which the previous Labour Government hoped to tackle this issue, and scrapping it will be a step backwards.

At a time when the coalition proposes to increase university tuition fees, I would have thought it wise to defend child trust funds as one way in which young people could choose to shoulder at least a tiny bit of the burden of those costs. Even if they do not go to university, any funds available to 18-year-olds must give them a better start in life, which the better-off take entirely for granted. It may only help to fund their driving lessons, but that will give them the mobility and employability which would otherwise be denied.

Instead, having promised huge and unnecessary cuts over the next four years, the Government must cancel valuable programmes that are relatively inexpensive. Scrapping the child trust fund is a decision made with an eye on the short-term political goal of cutting the deficit, not the long-term responsible goal of encouraging families to save for their children’s future. The age group facing the most debt is 16 to 34-year-olds. Surely a responsible Government should be seriously considering measures to help the next generation of young people, particularly given that university fees are set to rise to eye-wateringly high levels.

The Government are intent on pressing ahead with these family cuts, but when will the Minister tell us how the plans to fund and retain the infrastructure of the fund, to enable contributions to be restarted when the economic position improves, will work? I am told by the Save Child Savings alliance that it would cost £2 million a year to do so—a very small fraction of the total overall cost. There is an alternative to these draconian cuts, despite what the coalition says. Labour would deal with the deficit by halving it over four years. Yes, there would still be cuts, but we could cut carefully and always with an eye on the human impact. I am not confident that I can say the same about the coalition.

[Several hon. Members]

rose—

[Mr Speaker]

There is no formal time limit on Back-Bench speeches in this debate, but it might help the House if I mention that no fewer than nine hon. Members—all, as it happens, on the Opposition side of the House—are seeking to catch my eye. The Front-Bench winding-up speeches will begin no later than 9.40 pm. I know that hon. Members can do the arithmetic for themselves and I am sure that they will want to help each other.

20:36

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

Let me start by addressing a point that the hon. Member for Mid Norfolk (George Freeman) made. He implied that there was no glee on the Government Benches last Wednesday at the comprehensive spending review announcement, but I was in the Chamber and I clearly remember the cheering and waving of Order Papers when those vicious cuts were announced.

[Ben Gummer (Ipswich) (Con)]

rose—

[Diana R. Johnson]

I am not going to give way.

I also take issue with the hon. Member for North East Somerset (Jacob Rees-Mogg), who reminded me very clearly why I am on the Opposition side of the Chamber and of my commitment to a modern, enabling welfare state that not only meets needs but opens opportunities to the poorest and extends people’s life chances and opportunities. Those were key objectives of the progressive politics behind the child trust funds, the saving gateway and the health in pregnancy grant. I want to tell hon. Members why, for my constituents, the decision of the Liberal Democrats and the Tories to scrap these three policies is short-sighted and fundamentally wrong.

I have heard Ministers and Government Members talk at length about the economic environment and about cuts being inevitable, but the cuts disproportionately affect children and families, and that is not fair. All the decisions that the Government side is making are choices of the coalition Government. The cuts are not inevitable: the Government are taking those decisions. They decide where to allocate funding and what their priorities are—and their priorities clearly are not women and children.

We have also heard a lot from Government Members about wanting to target benefits more, but that is not what the Bill is about. It is about the wholesale scrapping of three important policies. As an MP in Hull, I know only too well that people often struggle to provide for their families on a day-to-day basis. They often live week to week, juggling as best they can paying bills and meeting their commitments. In Hull, the average household income is just £21,623 compared with the English average of £35,544 and the Yorkshire and Humber average of £29,902. Since 1997, there has been a 5% increase in average household income, but it is still a low-income area. The opportunity provided by child trust funds of a savings vehicle for Hull children and a nest egg for young adults is something that many families have never been able to provide no matter how much they wished to do so.

A few years ago I held a child trust fund surgery at a children’s centre in my constituency—it is worth reminding Government Members that there is no ring-fenced funding for Sure Start, so we will wait to see whether those centres continue—and there was clearly a lack of financial literacy among many of the parents to whom I spoke. The child trust fund provided a real opportunity for families to think about finances and about having some capital set aside for their children when they reached the age of 18. Many families are able to save regularly for their children so that there is a capital asset that their children can use when they reach 18 to pay for driving lessons, buy a car or pay for higher education. Having assets and savings is something that more privileged people, such as the 20 millionaires in the Cabinet, take for granted, but in my constituency that is not the case. That is why the child trust fund was such a good idea: it was universally progressive—I am glad that we have been able to teach Government Members what that means—as poorer children received more.

Cutting the child trust fund and cutting the saving gateway are just two examples of how the coalition’s spending review attacks families, and attacks women and children from poorer backgrounds with special venom. They have already seen child benefit frozen and cuts to the child tax credit, and in the comprehensive spending review the education maintenance allowance is going, there are higher tuition fees for universities and now there will be tuition fees in further education colleges. The pupil premium, the Deputy Prime Minister’s fairness fig leaf, turns out not to be new money within the schools budget, and will do little to mitigate cuts in schools, including the switch of funds to free schools. There will also be cuts to local authority budgets, particularly in children’s services. We have heard lots of warm words on the coalition Benches about looked-after children, but looked-after children are paid for out of local authority budgets for children’s services, so let us see what the outcomes are for those looked-after children after the 30% cuts to local government finance.

To be fair, before the general election, as my hon. Friend the Member for Rochdale (Simon Danczuk) pointed out, the Lib Dems made it clear that they wanted to abandon and abolish the child trust fund. Even though the Conservatives had indicated that they wished to make the fund more targeted, the Bill would scrap the whole lot.

The coalition of those who now say that a child trust fund, or something very similar, should be reinstated includes the Daycare Trust, the Family and Parenting Institute, the National Childbirth Trust and think-tanks such as ResPublica, whose director Phillip Blond is often in the media as the red Tory mentor of the Conservatism of the right hon. Member for Witney (Mr Cameron). Abolishing the child trust fund will be a regressive measure, and will not promote social mobility and equality of opportunity—something that Conservative Members go on and on about. This measure will not deliver that for them. It will also be a backward move.

Many of those groups argue that we should promote a savings culture. It is ironic that when the Secretary of State for Business, Innovation and Skills, the right hon. Member for Twickenham (Vince Cable), was on the Opposition Benches he used to speak at length about the need to promote a savings culture in this country, and yet he is part of a Government doing exactly the opposite. That links in with the saving gateway policy—a scheme that was successfully piloted in Hull. It was designed to promote a savings habit among people on lower incomes, with the Government incentive that every pound saved by an individual would be matched, and to encourage people to engage with mainstream financial services. That latter point was very important, as loan sharks and doorstep lenders are a real problem in parts of Hull, and it is vital to promote the excellent work of credit unions, such as the Hull and East Yorkshire credit union, managed by John Smith in Hull. Individuals would be passported in to the saving gateway if they were in receipt of certain benefits and tax credits. All that has fallen by the wayside, and it is such a shame for constituents who could have benefited from that excellent scheme.

The health in pregnancy grant was a clear example of an enlightened potential spend-to-save policy, paid to expectant mothers from the 25th week of pregnancy on condition that they had received maternal health advice from a health professional, and paid for the first time from April 2009. I have always been concerned about health inequalities in Hull compared with other areas of this country, and we need to focus generally on maternal health and the early years of life. It has been very important to focus on good nutrition, for example. In July 2010, 86% of pregnant women and mothers of young children in my constituency were eligible for the healthy start programme, which is a targeted programme, compared with a Yorkshire and Humber average of 82%. In the light of that statistic, if the Government are willing to listen and think about targeting the health in pregnancy grant, it seems to me that a vast number of my constituents would be eligible.

I asked Ministers how many people in my constituency were receiving the health in pregnancy grant, but I was told that information was not available. It is ironic that a Government who are requiring councils to list all spending over £500 are not keeping that kind of information, which would help us in our decision making. The grant is also important in helping with the additional costs incurred by families when a new baby is on the way, and it is the link with the health advice that is so important. We heard the quote from the Royal College of Midwives, which was quite clear about the importance of that health advice.

The Government are making the wrong choices. There are alternatives. There are different ways to deal with the deficit. It is unfortunate that the Government will not listen and are taking an ideological view of where the cuts fall, and it is unfair that women, children and babies are being penalised.

20:45

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

I wish to speak in the debate tonight because of my deep concern that these proposals will ensure a bleaker future for many young people and their families in our country. In particular, I am deeply concerned that cutting the measures that promote savings and financial stability for many of the poorest families in our society saves comparatively little for the public purse but will have a massive long-term impact on social mobility. I want to make my remarks in three stages: first, my concern that we need to do more to help families to manage their finances and plan for the future, which measures such as the saving gateway and the child trust fund help support; secondly, the evidence that those products were achieving the aims that they set out to achieve; and, finally, the wider social consequences of failing to support action on social mobility.

Members may know of my concerns about affordable credit and the financial hardships of many of the families in my local community. My concern that the Government should act to support measures that will help to tackle the causes of debt and improve access to affordable credit are expressed in the ten-minute Bill that I will table in the House next week. I fear that the forthcoming cuts to public services, which have already impacted on the incomes of families in Walthamstow, will make such problems worse, given the high number of local residents who work in the public sector.

To give some flavour of the financial planning problems that families in areas such as mine are facing, I want to refer to a survey recently undertaken by the Children’s Mutual society on the impact of the credit crunch on family finances. It found that one in four families in this country claim their household income is not enough to pay their bills each month. Given many people’s fears about redundancy and the impact of the cuts that the Government plan to their livelihoods, it will not surprise many Opposition Members to learn that one in 10 families fear that the main breadwinner will be made redundant in the next six months. Three quarters of them have debts in the shape of credit cards, loans and overdrafts, and a quarter of them have borrowed money from their parents in the past year. Without intervention, those cycles of debt will continue and deepen as these cuts bite.

Helping parents to plan for the financial future of their families is about not just a stable economic platform in Britain, but the quality of life itself. Some 29% of British families admit that they are already arguing over their family’s finances. A third of parents are suffering from sleepless nights because they are worried about money.

There is therefore a deep irony that the Chancellor makes comparisons between household debt and national debt, and then scraps the measures that help to address the former in the name of addressing the latter. Thinking of the future when the present is so fragile is tough at the best of times for such families. Taking away the mechanisms by which the Government can help them indeed makes the worst of times, but that is exactly what the Government are doing in this Bill to families such as those in Walthamstow whom I represent.

Abolishing the child trust fund and the saving gateway will do nothing to secure the culture that the Chancellor said just 18 months ago he wished to see in this country in a speech to Reform about a nation that supports savers. He is not the only member of the Government who wanted to support a savings culture in the UK; even after the election, when we know that many pledges have been broken, the Financial Secretary to the Treasury argued that the Government

“is committed to curbing unsustainable lending and helping individuals manage their finances better”.

Those are laudable aims. They are aims that I share and that also motivate my ten-minute Bill, but that is why I find this legislation all the more heartbreaking: it stops in their track programmes that we know have a proven track record in improving savings for some of the poorest families in our nation, including many in my own constituency of Walthamstow.

[Sarah Newton]

I wonder what analysis the hon. Lady has done to demonstrate that the programmes help in the way she suggests, to enable people in low-income households to save for the future, because I understand that very few families have made any additional contribution to the child trust funds.

[Stella Creasy]

I am glad that the hon. Lady asks about an Opposition Member looking for evidence. If she listens to me, she will find that I can refer to many different research points that can bring out exactly that. It would be useful in these debates to move from the examples given to what the independent academic research tells us the child trust fund has done in increasing savings in this country. I direct her to the work being done by the university of Bristol on this matter in particular.

As an MP in Walthamstow, I cannot help but see the impact of the Government’s decision. The latest figures tell me that more than 10,000 families in Walthamstow have a child trust fund voucher—well above the national average for a constituency. Nationally, we know that 70,000 are issued each month, including the top-ups, at a cost of just £500 million to the taxpayer. It is a relatively small investment compared to some of the other mechanisms that we have, but we know that it is money well spent, because until they were stopped, child trust funds were the most successful Government savings scheme ever.

My hon. Friend the Member for Stretford and Urmston (Kate Green) admirably set out the evidence that we have. It is worth repeating because of the questions being asked by Members on the Government Benches. Two million people were contributing to 4.5 million open accounts, resulting in more than £2 billion in assets, with £22 million in regular contributions. Critically, those are from families on less than £50,000 a year. In London that is not a high target rate to meet.

To get the full sense of what abolishing the scheme will mean, it is worth looking at the sums involved. Thanks to the Revenue’s child trust fund calculator, I was able to do just that. It tells me that a child born on my birthday this year eligible for just that basic payment of £250 from the Government and whose family saves just £100 a year, which is not even a tenner a month, could get about £3,000 in 2028. If the family started saving £20 a month, the figure could rise to £8,000. At £4 a week, it would be nearly £10,000.

[Harriett Baldwin]

Will the hon. Lady give way?

[Stella Creasy]

With respect, I have given way once.

We do not need to wait until 2028 to see the impact that such funding will have on the choices that young people could make. We know that in 2020 the first generation of child trust funds will mature. That means there will be 18-year-olds with access to £3 billion of investment for our nation. That may not be the riches of Croesus that some on the Government Benches will be able to bequeath to their children, but for the families that I work with in Walthamstow those first funds maturing in 10 years will transform the choices that their children are able to make.

In the context of the other debates that we have had in the House recently—on tuition fees, home ownership and entrepreneurship—we all know the difference that that kind of money will make. Putting that £3,000, the lowest sum, into context, it is worth reflecting that evidence shows us that parents are spending on average £4,000 on financing their children through university. We know, too, that more than half of 25 to 34-year-olds still rely on their parents for financial help. With tuition fees set to rocket under the present Government, that debt, that dependency and that distress for the parents concerned are only set to rocket.

Countless research studies show us that low income families aspire to saving for the long term, and that they want a nest egg for their children. The child trust fund is helping to make that ambition a reality, with almost 30% of the children who get the child trust fund also getting the top-up endowment of £500, meaning that their nest egg will be even bigger.

[Bill Esterson (Sefton Central) (Lab)]

My hon. Friend makes a good case for the evidence for saving, particularly in low-income families. Is she aware of the House of Commons Library research that predicts a £4 million saving from the abolition of the three schemes, which compares rather unfavourably with the amount to be saved by the levy on the banks? Will she comment on that?

[Stella Creasy]

I thank my hon. Friend for that question. He precisely answers the point that many on the Government Benches wish to raise about where else money could be raised. There are ample other ways that we could raise money to reduce the deficit, such as the bankers levy.

[Harriett Baldwin]

Will the hon. Lady give way?

[Stella Creasy]

I shall make progress, as Mr Speaker has pointed out how many Members want to contribute.

I want to put on record my concern that children who will have the child trust fund removed—those 30% who are getting the extra payment—are kids from the families most likely to be hit by the cuts in public spending, as the housing benefit, tax credits, jobs and services that their parents rely on are also slashed by the Government. These are the kids of families who already struggle to make ends meet and for whom the scheme represents a lifeline of opportunity for their children in later life.

Members need not take my word for it. Let them look at the reports from the Treasury and the Institute for Fiscal Studies. They make it clear that the poorest will bear the brunt of the cuts. The Bill ensures that the burden will carry on to their children as well. This is not fantasy or wishful thinking, as some on the Government Benches may wish to claim. Since the scheme has been running, there has been clear evidence that it works in encouraging saving and supporting aspiration.

It is not fantasy to think that that money would be spent on the future of those young people. The research commissioned by the Treasury shows that families of all incomes see the money as the key to their kids getting on in life, whether it is used for higher education, setting up home or even having driving lessons. The research reflects the ample evidence and common-sense proposition that possession of even a small pot of money in early adulthood improves one’s life chances later on. It shows the strength of the economic argument for retaining the child trust fund, and that a savings culture can be ingrained in people from the early years of their lives. It shows also how counter-productive it is to cut the fund now, because the funding that would have been available to our economy in later years will also be absent from the choices that children are able to make.

The strength of the scheme, and what I want to concentrate my final remarks on, is the evidence that a small amount of capital at the beginning of life had a significant advantage for children 10 years on in life, even when accounting for employment, higher earnings and better health. At the heart of the scheme, and the reason why the previous Government introduced it, is a concern for social mobility, something that Government Members say that they too care about. If they do care about it, however, they will understand that assets are the key to social mobility.

Labour Members understand that if a child is born with a silver spoon in their mouth, it means not just nice baby clothes or a wonderful pram but the money, resources, confidence and networks that help to turn potential into reality. If a child does not have those assets, at every stage in their life their choices will be limited, and the decisions they make will be that much harder, whether they are about where to live or the lifestyle their family can afford, or whether they can even take the chance to go on to further and higher education. That is why Labour Members fought for the scheme and had planned to extend it if Labour won the election. It encourages not just savings, but aspiration.

We might look at our debates, and those that the UK Youth Parliament will have on Friday, about the right to vote and citizenship, but surely a truly progressive society is one in which we ensure that people have access to the capital endowment that gives them the same social power and responsibility of all their peers. I know that some Government Members agree. Only one day has been allotted to this debate, and attendance is low, but I hope that the country takes note of the fact that this Bill reflects the real impact of the Liberal Democrats on the coalition.

I urge those Government Members who consider themselves to be compassionate Conservatives to hold true to their own manifesto and to protect against this onslaught of Liberal callousness. The Conservatives’ manifesto at least pledged to protect the child trust fund for some children, so I urge them not to listen to the siren voices of the Liberal Democrats who, by abolishing the child trust fund, want to see the poorest families decimated.

The Liberals cannot even decide why they do not want the fund. Their claims run from “We can’t afford it,” to “It’s not the best way to secure asset-based mobility.” But as the former Chief Secretary to the Treasury said—

[The Economic Secretary to the Treasury (Justine Greening)]

“There’s no money left”.

[Stella Creasy]

I accept that the hon. Lady may be confused, but let me be clear that I am talking about the former Chief Secretary to the Treasury who claimed that the Government could not afford to continue with the child trust fund because it would burden future generations with a bigger debt. Some Opposition Members think that burdening future generations with no opportunity in life at all is not a price worth paying.

If we are to continue looking at what Chief Secretaries to the Treasury have said, we will find it worth considering what the current one said back in 2008, when he agreed that asset-based welfare was the true path to social mobility. He argued that there needed to be an alternative to the child trust fund, but tonight we have not heard about any measures to replace the asset that people would have had. We have heard nothing from Government Members; the silence has been deafening. Opposition Members have clearly explained why an ISA is not the same as a child trust fund.

My private Member’s Bill next week will call for a levy on financial institutions to help to support debt counselling and advice services. That is why I welcome the Financial Secretary’s remarks that the Government would back a consumer financial education body to begin that process of supporting financial advice services. However, it is no good on the one hand offering help and support for families who get themselves into debt, and on the other taking away the savings vehicles that keep such families going.

Given my proposal, I hope that the Minister will agree to meet me and other campaigners to discuss what more can be done to address the causes of poverty and ensure that families have access to affordable credit. Whether we are talking about the child trust fund, the health in pregnancy grant or the saving gateway account, I urge the Government to rethink the Bill and recognise that it is not in the long-term interests of families throughout Britain to support such measures.

A nation which ensures that every young person and their family has financial assets at key stages in their lifetimes is one in which potential stands a much greater chance of being realised. If the Bill is overturned and the scheme kept, a world of possibility will open up to many of our young constituents. I urge the House to reject the Bill and to sustain these vital instruments of social progress.

[Several hon. Members]

rose—

[Mr Speaker]

Order. We have just over 40 minutes, and I still have seven names on my list.

21:00

[Nic Dakin (Scunthorpe) (Lab)]

To take a gamble with your own money, especially if you are a millionaire, is a reasonable choice to make, but to take a gamble with other people’s money—or, worse still, other people’s livelihoods and futures—is reckless in the extreme. But that is what the Government are doing. It is not Labour MPs who are saying that, but respected commentators such as Andrew Rawnsley of The Observer. On Thursday, the Financial Times described the Government’s plan as “an audacious gamble”. With economics Nobel prize winners queuing up to say that the policy of this naive Tory-Liberal coalition Government will have us floundering on the rocks of high unemployment and economic stagnation, we are in very difficult times.

Paul Krugman, the 2008 Nobel prize winner, said:

“The best guess is that Britain 2011 will look like Britain 1931.”

It is hardly surprising therefore that the Chancellor of the Exchequer most evoked by the policies being pursued is Philip Snowden, whose policies plunged the country into recession in the 1930s. At least the hon. Member for North East Somerset (Jacob Rees-Mogg) was frank when he said that the Government are following the policies of the 1930s. The Bill is part of an overall picture that shows that this Government are targeting their cuts at families and children, making them pay more than the banks whose proclivities got us into these difficulties.

The Bill will remove child trust funds, abandon the saving gateway and abolish the health in pregnancy grant. The Institute for Fiscal Studies clearly demonstrated in its analysis that the Government’s plan will have a more severe impact on the lowest-income households. These proposals are further proof of this Government’s desire to penalise children and jeopardise the nation’s future.

The child trust fund is a savings account for children born in or after September 2002. The Bill will end new child trust funds—worth £1,000 in their lifetime for the poorest children—from January 2011. The poorest children who were due to receive a £500 top-up on their seventh birthday will now not do so. Child trust funds have not only given children, especially the poorest children, a financial start in life, but shown the state encouraging saving and investment by example. These are habits that we need to establish in as many people as possible. If such habits are formed and nurtured, they will help us to address many of the great challenges of our age.

The saving gateway was designed to build on the child trust fund by promoting a savings habit among those of working age on lower incomes by providing an incentive to save. There would be a Government contribution of 50p for each £1 saved. That would promote financial inclusion by encouraging those most at risk to get involved with mainstream financial services. More than 22,000 people took part in the two very successful pilots, achieving more than £15 million in savings. A letter from the Save Child Savings alliance to The Sunday Times said:

“For a government that claims to want to promote savings, the decision to abolish the Child Trust Fund along with the Savings Gateway is short-term and misguided.”

The investment in the UK’s savings culture is under threat from these measures. Supporting and creating a national environment in which people are encouraged to save for their future should be a fundamental goal of any responsible Government. However, with overall savings ratios close to their 2009 all-time low and, according to the Office for Budget Responsibility, set to fall to 5.5% by 2015, the UK under this Government is sleepwalking into a situation in which the culture that we are encouraging on savings is exactly the opposite of the one that we need. Whatever their politics, all hon. Members surely agree that the fostering of a long-term savings culture is something that the UK badly needs. The process of achieving that must start with the initiatives that this Bill seeks to remove.

Even if one accepts the repealing of those positive initiatives, there can surely be no financial or policy logic in scrapping the core infrastructure of the child trust fund scheme, given that it demonstrably works. It would surely be far more sensible to leave that infrastructure in place to support future schemes that might be introduced. When introducing the Bill this afternoon, the Minister said that future initiatives would be coming forward. I ask him and the Government to consider leaving this infrastructure in place, because it is proven to support initiatives and, as mentioned earlier, would enable the state to show its corporate parenthood, via child trust funds, at least for looked-after children.

The other casualty of the Bill, if Liberal Democrats and Conservative Members, who tell us they care about children, troop into the Lobby and vote for it, will be the health in pregnancy grant, which is a one-off, tax-free payment for mothers who are 25 weeks into their pregnancy. My hon. Friend the Member for Stretford and Urmston (Kate Green) gave a full and cogent explanation of why the grant is effective and makes a difference, and if we cannot invest to ensure that our babies and children get the best start possible in life, what on earth are we about? Belinda Phipps, chief executive of the National Childbirth Trust, whom my hon. Friend quoted, said recently:

“At a time when families are trying to make ends meet, the Coalition Government has hit parents particularly hard. Cutting pregnancy and maternity grants, as well as child benefit and tax credits, will make it even more difficult for new parents or those wanting to start a family.”

The Bill is part of a pattern of penalising families and children for the economic problems caused by the meltdown of the global economy. [Hon. Members: “It was caused by Labour.”] No, it was caused by the meltdown of the global economy. Conservative Members cannot rewrite history and pretend that there was no global financial crisis and that their party in opposition did not support every spending plan up to the end of 2008. It was only when the global meltdown came that they did not want to spend the money to save this country from recession. That is the sort of party we are up against.

Withdrawing the child trust fund, ending the saving gateway and abolishing the health in pregnancy grant is bad enough, but add to that reducing tax credits, the withdrawal of the future jobs fund, the destruction of the education maintenance allowance and the hike in tuition fees, not to mention the significant cuts in funding to schools and colleges currently camouflaged by the smoke and mirrors of Government chicanery, and this represents a devastating programme. The Government are making families with children pay more than double what the banks are to pay to bring down the deficit—hardly fair, Mr Speaker, hardly fair at all.

21:07

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

We have heard tonight two main arguments from Government Members. The first, which may be familiar to Members on both sides of the House, is that there is no alternative, but the absurdity of that position should be clear to everyone. Budgets are inherently political acts, and the notion that the Government have no choice is ridiculous. It is nonsense. The House of Commons came into being over the issue of supply. The modern House of Commons emerged because there were debates about how money should be appropriated. So let us nail that myth.

Listening to Government Members, we realise that this argument is only a front for their real argument. We have heard an attack on universal benefits that has been repeated throughout this debate, to which I have listened closely. These attacks have continued despite the fact what we have heard continually from my hon. Friend the Member for Stretford and Urmston (Kate Green), who has forgotten more about these issues than anyone on the Government Benches even knows.

I turn quickly to something that the hon. Member for North East Somerset (Jacob Rees-Mogg) mentioned. I am sorry to see that he is not in his place. He might be an historian—I personally will reserve judgment on that—but he certainly is not an expert on asset-based policies, because he suggested that the child trust fund and the saving gateway in particular are examples of nanny-state socialism. I have a message for those on the Government Benches: they are not examples of nanny-state socialism; they are examples of liberalism.

The child trust fund is a policy whose objective is to promote social mobility. It is a starting point—a symbol and a recognition of the fact that massive inequalities of wealth exist in our society, and that these inequalities exist in addition to the massive inequalities of income. The child trust fund is also a policy with a long history. Thomas Paine first proposed the idea of state-backed assets for all individuals reaching adulthood at the turn of the 19th century. No nanny-state socialist he. Thomas Paine suggested such payments because he understood that inherited wealth unfairly tipped the scales of life in favour of those who were born lucky, rather than those who worked hard—something that I am sure Members on both sides of the House agree with.

The child trust fund operates on that principle, by hopefully making it possible for young people from ordinary backgrounds to go out into the world in future with savings to their name. I say “in the future”, because nobody is suggesting that the child trust fund was a perfect policy or that it had achieved everything that we hoped it would achieve, but it has hardly bedded down and now it is being abolished. The child trust fund allows ordinary kids going out into the world to ask themselves a basic question that we have all asked ourselves, as we went forward in our lives: what do I want to do with my life?

As such, I am afraid to say that abolishing the child trust fund represents another nail in the coffin of a once great tradition of social liberalism. Social liberals used to recognise—indeed, social liberals still do—that in the absence of a fair distribution of income and wealth, real freedom is impossible for most individuals. “Assets for all” is an inspiring cry that we used to hear from those on the Liberal Benches. No longer do we hear it.

[Mr David Anderson (Blaydon) (Lab)]

“Limousines for all”!

[Gregg McClymont]

That may well be the case; I could not possibly comment.

I know that a number of people are waiting to speak, so I shall be brief. However, I want to reiterate the point that the child trust fund is about freedom and opportunity. It is not about nanny-state socialism; it is about trying to enable young men and women who are not from privileged backgrounds to go out into the world when they turn 18 and have a chance to make something of themselves. I would have thought that that was something that everyone, in all parts of this House, would support. And please, let us not hear again from those on the Government Benches that there is no alternative. The Government are spending, on behalf of us all, £697 billion this year. Abolishing the programmes that we are debating this evening will save around £4 billion. Are the Government really telling us that there is no alternative? I for one do not believe a word of it.

21:13

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

I know that time is short, so I intend to be quite brief, although I apologise in advance for not allowing any interventions, as a number of colleagues still wish to speak.

I endorse and echo the sentiments expressed by my right hon. and hon. Friends, who have explained in detail why the child trust fund and the health in pregnancy grant are important and why we need to retain them. I want to deal with the three reasons given by the Government for why they have brought forward this piece of legislation. The first reason is that they have to make these cuts and that the Bill is the only way to do so, because of financial difficulties. Paul Krugman, who was mentioned by my hon. Friend the Member for Scunthorpe (Nic Dakin), recently said that the Government’s cuts are ideologically driven, not driven by economic necessity. Therefore, economics has nothing to do with the reason for making the cuts in this Bill.

Secondly, we are told that the schemes are being cut because they are universal benefits, benefitting the rich and poor alike. However, if that is the argument, why should the Bill not be amended to say that such benefits should be means-tested, so that those who need them can keep them? That would make the Government’s case more logical. I suggest that the Government are using the argument about this being a universal benefit, even though they do not do so in regard to the winter fuel allowance—I want to put on record that I am not against the winter fuel allowance being universally available—because it is well known that people of pension age are the most likely to vote, while those who receive income support have the lowest tendency to vote. Perhaps there is an element of self-interest there. That would explain why the Government think it is fine to abolish one universal benefit, the child trust fund, but wrong to abolish the winter fuel allowance.

It has been said that the child trust fund has not led to an increase in the savings culture in our society, and that it was intended for children to use when they reached 18 and were grown up. We know that the savings culture has gone from our society over the past 20 or 30 years and that people are saving less and less. However, many people in their early 20s to mid-30s find that having children is an encouragement to save, and that is bringing saving back into our society. To suggest that the argument about the savings culture does not apply because a child does not benefit from the trust fund until they are 18 is also wrong.

The child trust fund continues to be among the most successful Government savings schemes ever. Two million people are now contributing to 4.5 million accounts, resulting in more than £2 billion of assets under management and attracting more than £22 million a month in regular contributions. As my hon. Friend the Member for Walthamstow (Stella Creasy) pointed out, the majority of this activity is undertaken by families with an income of less than £50,000. We have seen that the number of people saving has increased, and the Government should be thinking about how to make that very successful programme even better. We should be trying to find ways of extending and improving the system, not abolishing it.

I shall turn now to the health in pregnancy grant. If someone is well-off, so be it: becoming pregnant probably causes no inconvenience or difficulty for them. Having a child results in many extra expenditures, however, and the Government should surely be able to afford giving even a little extra money to those on very low incomes. They have told us that they have introduced a levy on bankers’ bonuses, but if this is all about finance, why can they not increase the levy just a little more? I am part of a group called the Robin Hood tax alliance, which contends that if we were to tax the bankers a bit more, we could easily get £45 billion. That would be more than enough to pay for the child trust fund and the health in pregnancy grant. The money is there in the system; it is just a question of whether there is any will on the part of the Government to use it in the right way.

The argument that we have to make these cuts just does not wash. This is really sad, and I am surprised at Members on the Government Benches. I thought that there were more compassionate Conservatives out there who would think that these benefits could be retained. If they really do not want to provide them on a universal basis, they could at least target them at people on lower incomes.

21:18

[Sheila Gilmore (Edinburgh East) (Lab)]

Early in the Minister’s introduction to the debate, one of the reasons he gave for not going ahead with the saving gateway account was that there had not been enough take-up by banks. He also argued that credit unions did not exist in every deprived community, and that they would therefore be unable to operate the saving gateway accounts adequately. I think that he was putting the cart before the horse. The saving gateway would have given the credit unions a huge boost and allowed them to develop.

The credit union in my constituency is fragile, because it serves an area in which people have difficulty saving. They might wish to borrow, however, and to do so through a credit union is much better than using some of the other methods on offer in the area. It is difficult for credit unions to balance their savings and their borrowings, even without taking into account their administration costs and all the other expenses that they incur, and they need to get volunteers to do the work. So, if we want the credit unions to grow, we need to assist them, and retaining the saving gateway account would have been one way of putting credit unions such as the one in my constituency on to a firmer footing.

If a credit union is not an example of “the big society”, I would like to know what is. I believe this illustrates a fundamental incoherence, which we can see in many of the policies presented by the coalition Government. They have a lot of the words and a lot of the language—in fact, I sometimes think that Government Members are stealing our language—but if we look at what is being done as opposed to what is being said, we see the truth. Here is an example of something that should be encouraged as part of the big society, which we are all supposed to be supporting, but some of its lifeblood is being cut off through this policy.

Another incoherence is seen in considering what types of benefits we should have. As I said before I was elected, we all need to discuss that—I am not suggesting that my party has no need of further discussions—and I shall carry on saying it. Do we want universal benefits or not? If we have them, yes, there are costs. Personally, I would have been happy to see child benefit made part of taxable income in a more coherent way. If we want universal benefits, yes, there are tax implications.

There are some strange inconsistencies around. I may have imagined it, but I thought I heard the Secretary of State for Business, Innovation and Skills extolling on the radio yesterday—several times throughout the day on the BBC—a policy that he claimed the Government would adopt over the next few years: providing pensions and giving the current rate of means-tested pension credit to everybody over pension age. I think that would be fantastic, especially if we could further reduce the dependence on means-testing. Many of my constituents, particularly those just over pension credit level, would feel that that was fair. There is a huge cost, however, which would have to be paid for. Is that really the policy of the coalition Government, or only that of one party trying to distract attention from the comprehensive spending review? Can it be the policy when we have heard today all sorts of arguments against universal benefits being made very strongly by Conservative Members? I found it quite offensive to hear some Conservative Members describe what they thought people might use their health in pregnancy grant for—it is not necessarily eased by other benefits. That is why I have referred to incoherence in the policy, which needs to be sorted out. It is right for us to expose it.

We have different views on how the economy works and on how to get out of the recession. We could go into all sorts of history lessons. The 1930s are often mentioned, but we have to go beyond 1931, 1932 and 1934. There is a strong economic argument for saying that we did not get out of the recession until re-armament started before the second world war. It can also be argued that the UK went through a double-dip recession in the mid to late-1930s. Economists disagree, of course, but none of us should take such an absolutist position as to suggest that we are simply right. We have a view; you have a view—[Interruption.] I am sorry, Mr Speaker, you do not have a view. The coalition Government have a view, but we should be prepared to listen to alternative points of view.

21:23

[Valerie Vaz (Walsall South) (Lab)]

It is always a pleasure to follow my hon. Friend the Member for Edinburgh East (Sheila Gilmore). Unsurprisingly, I shall speak against the Bill. As mentioned earlier, the Bill contains three main provisions: the abolition of the £190 health in pregnancy grant and the phasing out of the child trust fund and the saving gateway provisions.

The £190 pregnancy grant should be uncontroversial in its effect. It is a simple measure to ensure that, at this important time of their lives, women who face a huge physiological upheaval in their bodies as they nurture a new life, receive this additional money. They need it. We become deficient in many things—calcium and iron, to name but two—and this simple grant enables women to put back these vital foods to enable the proper growth of their unborn child and to ensure that they remain healthy when their baby is born. I have heard many Government Members, mostly men, say that we do not require decent food throughout the nine months, but in fact we do, because soon after that we have to feed growing children. The provision can be seen as an attack on women at their most vulnerable. As if that was not enough, the attack is on children as well.

By all accounts, the child trust fund has been a successful savings scheme, and I believe it will teach children to be fiscally responsible. The beauty of it is that every child, irrespective of the circumstances of their birth, has a trust fund. The facts are these: £2 billion is held in child trust fund accounts; 74% of parents have opened an account—sadly, in my constituency, the figure is down to 64%—and almost £470 million is paid in by grandparents. No one can touch that money except the beneficiaries, when they are 18. The money is there for them whatever their circumstances—whether they are looked-after children, the children of two-parent families, or the children of single parents—and no stigma is attached. It is not, as the Deputy Prime Minister said in 2009, a few hundred pounds in the hands of 18-year-olds; it is a solid account of savings over 18 years.

We want our children to grow up to be independent, fiscally aware and responsible. How much does the child trust fund cost? The answer is £524 million. In contrast, during four months in 2009, £2.3 billion was levied through the one-off tax on bankers’ bonuses. The new levy coming into effect will raise £2.5 billion. As the slogan goes, Mr Speaker, you do the maths.

Above all, the child trust fund fosters a savings culture in which children know that something has been put aside for them. In my view, that will make them better citizens. To paraphrase a slogan that is used, we can say to them, “This is what the state has done for you. What can you do for the state?”

My biggest concern is that the proposal was not put before the electorate, and the people did not have a say. Our children are our future. Let us give them a future, for the good of the country. I urge all hon. Members to vote against the Bill.

21:27

[Catherine McKinnell (Newcastle upon Tyne North) (Lab)]

Over the past few days, weeks and months, there has been a lot of talk about “fairness”, which is an easy word to use. Who is the judge of what is fair? Whose standards of fairness are being applied? Many believe that the measure of a civilised society is how it treats its weakest members. If so, the Bill clearly fails the fairness test, because it lets down families and leaves our children to take the strain.

When the Prime Minister spoke about “mending our broken society”, he did not say that he would go around breaking it first.

“I want the next Government to be the most family friendly Government we’ve ever had in this country”.

It was a broken promise, one of many, with more to come. Then we have the Chancellor’s hollow promise of fairness:

“A fair Government make sure that those with the broadest shoulders bear the greatest burden.”—[Official Report, 20 October 2010; Vol. 516, c. 955.]

Today we see the Liberal Democrat and Conservative idea of fairness.

Anyone who has young children running around knows how expensive bringing up a family can be. As we are discussing the removal of a grant of £190 to encourage health in pregnancy, I want to talk about how expensive simply being pregnant can be. There seems to have been a lot of debate and misunderstanding about the value of the grant. My hon. Friend the Member for Walsall South (Valerie Vaz) made good points about the physical nourishment required by a pregnant woman, especially in the later stages of pregnancy. On a physical level, however, a pregnant woman needs clothes to go to work, shoes for her swollen feet, vitamin supplements—I craved fresh fruit salad. I know mothers who have suffered from chronic back pain and chronic pelvic pain. They have struggled to sleep because the later stages of pregnancy are so uncomfortable. All those conditions can be helped by customised cushions, back supports and other aids, none of which is available on the national health service, all of which must be purchased, and all of which I was fortunate enough to be able to purchase, although many on lower incomes would not be able to. The health in pregnancy grant was designed to ease the final stages of pregnancy, and to ensure that a child is not born to a broken mother.

All that arises before we consider the huge impact of the link between the health visitor, the midwife and the pregnant woman that is currently required for the grant to be obtained. The financial pressures during pregnancy are difficult for all women, but teenage mothers suffer a particular burden. The Institute of Education has found that they suffer a lifelong financial disadvantage, with a lifetime family income £12,000 lower—or an annual income 2% lower—than the family incomes of those who become pregnant in their mid-20s.

[Toby Perkins]

Will my hon. Friend give way?

[Catherine McKinnell]

Am I the last speaker?

[Mr Speaker]

Yes.

[Catherine McKinnell]

In that case, I will give way.

[Toby Perkins]

My hon. Friend is making a compelling case. Does she agree that, whatever we may have thought about the upper-class buffoons whom we may have considered to constitute the Conservative party, they always seemed to have a sense of gallantry? When they said “Women and children first”, it was supposed to be a good thing. Nowadays, however, when they say “Women and children first”, they mean that women and children should be in the front line, facing a battering from the cuts. It is women and children first who are losing the benefits, it is women and children first who are losing the payments, and, most of all, it is women and children first who are paying the costs for these upper-class buffoons.

[Catherine McKinnell]

My hon. Friend ably makes a point that I was about to make myself. Families are being asked to bear the brunt of the mistakes made by bankers. The Government plan to take £190 away from the pregnant mothers who need it most. I believe that that constitutes a shameful attack on the most vulnerable and needy in our society. The Government tell us that the banking levy would bring in £2.4 billion, but my hon. Friend the Member for Walsall South set out the economic case—the “you do the maths” case—very clearly.

[Richard Graham]

I promise that my intervention will be briefer than the last one.

How fair does the hon. Lady think it is that those with money in child trust funds pay £25 million a year in fees at the last Government’s prescribed rate of 1.5% a year, which reduces the amount of money in the funds?

[Catherine McKinnell]

rose—

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

Does my hon. Friend agree that one of the crucial reasons the child trust fund is so important is that if a parent can save the maximum amount, the £18,000 or so would probably pay for one year’s tuition fees under the Liberal Democrats’ new plans?

[Catherine McKinnell]

I am grateful for all these interventions, but we had a discussion earlier about the benefits of the child trust fund scheme as opposed to the establishment of a potential ISA scheme. We dealt at length with the arguments in favour of the current scheme, which is targeted at everyone, including the most vulnerable and disadvantaged. The ISA scheme would not necessarily achieve that. However, I fear that we are becoming lost in figures.

The point that I am trying to make concerns the real-life cost of the decision to remove the health in pregnancy grant, to freeze child benefit and to cut the child trust fund, tax credits and the Sure Start maternity grant. It is clear that, as a result of those and other cuts, low-income families will bear the greatest cost of many of the Government’s policies. The average household income in the north-east is £12,543 a year. According to a recent report by Citizens Advice, the combination of the Government’s proposed cuts could cause a low-income family with a new baby to lose up to £1,235 a year—10% of the average household income of someone in the north-east. Is it really fair that children should be paying this price, rather than bankers?

Because of the establishment of the child trust fund, both my young children have bank accounts, and that is the start of saving for their future. I know of lots of families who are saving through child trust funds, regularly topping them up with birthday and Christmas gifts. Many people have admitted to me that they would not have started saving without the impetus to set up the account. We have discussed at length the benefits of the trust fund in encouraging a savings culture in this country; I think Members on both sides of the House agree that that is a positive development.

Since the child trust funds were introduced in 2005 there has been steady growth in the opening of new accounts, from 3 million in 2007 to 4 million in 2009. The current number is about 5 million—that is 5 million families saving up for their children’s futures.

The child trust fund was a universal and progressive policy that recognised the importance of children. It allowed families to open an account, but it gave greater assistance to those on lower incomes through additional payments from the Government. Abolishing child trust funds will lead to the next generation paying for the mistakes of the City bankers and financiers who caused the global economic crisis.

I beg the Government seriously to review this decision, and to accept the analysis of the independent Institute for Fiscal Studies that the spending review is regressive and that families with children will lose out the most. I also ask the Minister to consider some of the suggestions that have come out of the debate—such as keeping the savings mechanism in place while, perhaps, reducing the amount being put in, or means-testing if necessary—in order to hold on to this credit saving system that has already been so heavily invested in.

The Government are taking a terrible risk—reversing so much work that has been done to remove so many of our children from poverty. The Government have chosen to pursue this policy, and in my view and that of all Labour Members it is the wrong choice for our future generations.

21:37

[Kerry McCarthy (Bristol East) (Lab)]

It is almost obligatory for a Minister or shadow Minister rising at the Dispatch Box to respond to a debate to say that we have had a fascinating discussion, but I can genuinely say that our debate has been very engaging with lots of issues discussed and clear differences expressed between Labour Members and those on the Opposition—or, rather, Government—Benches. If only they were still in opposition; then we would not be in this position of having to try to defend measures such as these against attack from them.

At least the hon. Member for Blackpool North and Cleveleys (Paul Maynard) was brave enough to speak in the debate, unlike many of his Conservative counterparts. I do not think a single Liberal Democrat spoke, and it was very disappointing to see the lack of interest from them.

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

It was a lack of support.

[Kerry McCarthy]

Yes, we have to wonder whether the absence of so many Members from the Government Benches was due to a lack of interest or the fact that some of them have serious reservations about what is being proposed today. It was particularly noticeable that very few women Members from the coalition parties attended or spoke in the debate. I hope that that shows some concern on their part.

The hon. Member for Blackpool North and Cleveleys suggested that children would be better served by a piggy bank in their bedroom than a child trust fund, which shows a shocking lack of understanding of the issues. The hon. Member for Gloucester (Richard Graham) showed a similar lack of understanding by saying that an individual savings account was a better form of saving at zero cost to the taxpayer than a child trust fund. I gather from his CV that he worked for Baring Asset Management; I suspect that a background of working for Barings is not the best qualification for advising other people on how to manage their assets.

My hon. Friend the Member for Erith and Thamesmead (Teresa Pearce) made an eloquent speech in defence of the child trust fund. I want to congratulate her on becoming a grandmother today—[Interruption.] Has it not arrived yet? Well, I hope mother and baby do very well when it does finally come along. [Interruption.] Yes, there should now be a pregnant pause in my speech, as the shadow Chancellor, my right hon. Friend the Member for Kingston upon Hull West and Hessle (Alan Johnson), says.

The hon. Member for Strangford (Jim Shannon) and his colleagues from Northern Ireland showed how important they thought the child trust fund was for the people of Northern Ireland. He mentioned that it is backed by the credit union movement, which is obviously well developed there, and that it has cross-party support. We very much valued his support on that point.

The hon. Member for Mid Norfolk (George Freeman) described the contributions of Labour Members as “hysterical”. I have to say that that word is often used by a certain type of man when women express strong views. I am sorry if this makes him uncomfortable, but Labour Members are not desiccated calculating machines and we care passionately about defending the measures that the Government are trying to abolish in this Bill. My hon. Friend the Member for Stretford and Urmston (Kate Green) gave, as always, an awe-inspiring speech. She has impeccable credentials on this point and demonstrated the eloquence that comes from truly knowing her subject and caring passionately about it.

My constituency neighbour—in all other senses he is probably from another planet from me—the hon. Member for North East Somerset (Jacob Rees-Mogg), talked about these measures involving “pitiful” amounts that are “too small” to make a difference. It may be that in the world that he inhabits these sums are pitiful, but I ask him to cross the constituency border and come to meet some of the people whom I deal with in Bristol East, because he would then learn some lessons about how much difference these small amounts of money can really make.

That was something that my hon. Friend the Member for Walthamstow (Stella Creasy) showed in a well researched speech full of statistics. She described just how investing small sums can create substantial assets for a child in its future.

[Ian Swales (Redcar) (LD)]

rose—

[Kerry McCarthy]

I am sorry, but I do not have time to give way because we are a bit under the cosh.

My hon. Friend the Member for Rochdale (Simon Danczuk) talked about how scrapping the child trust fund would heighten the contrast between the tax advantages for the wealthiest savers and the poorest and vulnerable slipping further and further behind. My hon. Friend the Member for Stockton North (Alex Cunningham) reminded the House of the old biblical tale of the widow’s mite and the comparison with the poor being made to contribute to deficit reduction at great sacrifice while the very richest in society will not feel the same pain.

My hon. Friend the Member for Kingston upon Hull North (Diana R. Johnson) talked about how the saving gateway had been piloted in Hull. That measure was not mentioned as much during today’s debate, but it is obviously important and it was praised by my hon. Friend the Member for Scunthorpe (Nic Dakin).

My hon. Friend the Member for Cumbernauld, Kilsyth and Kirkintilloch East (Gregg McClymont)—I think that I finally pronounced that right after several attempts—talked about how the child trust fund is about freedom and opportunity, and not about the nanny state. That is such an important point to make, because the fund is about creating the ability for young people to go out into the adult world with a little bit behind them that they can put to good use.

My hon. Friend the Member for Bolton South East (Yasmin Qureshi) rightly pointed out that those on the Government Benches have been using specious arguments against universalism all afternoon, yet they are not arguing that the health in pregnancy grant should be targeted, although that would be the logical conclusion of their argument. They are also not using the same argument to say that the winter fuel allowance, for example, should be targeted.

We heard a passionate defence of the health in pregnancy grant and the child trust fund from my hon. Friends the Members for Walsall South (Valerie Vaz), for Newcastle upon Tyne North (Catherine McKinnell) and for Edinburgh East (Sheila Gilmore). The latter described some of the language used or some of the suggestions made by those on the Benches opposite about what the health in pregnancy grant could be used for as quite offensive. The suggestion that ladies, as my neighbour, the hon. Member for North East Somerset, would say, cannot be trusted to spend the money wisely in a way that would benefit their health and their child is quite offensive.

[Jacob Rees-Mogg]

rose—

[Kerry McCarthy]

By way of light relief today—[Hon. Members: “Give way.”] I would love to.

[Jacob Rees-Mogg]

I thank the hon. Lady for giving way, because I want to clarify that I had not made the point that people did not spend their money wisely. It may have been made by somebody else, but I would not like people to be confused.

[Kerry McCarthy]

My reference to the hon. Gentleman related just to the fact that he used the term “ladies” quite frequently during the debate, which is actually charming in its own way.

Earlier today, after a heavy morning spent in the Finance Bill Committee, by way of light relief I watched a video that had been posted on the ConservativeHome website in January this year. It was one of those videos that the Conservative party was very fond of when it was on a mission to convince the British voters that it really had changed and was no longer the nasty party. It featured the then Leader of the Opposition, now the Prime Minister, of course, in his shirt sleeves talking with well-rehearsed spontaneity to an audience carefully chosen to seem like a random cross-section of the general public. He said that he wanted this Government

“to be the most family friendly Government we’ve ever had in this country and that is about everything we do to support families and it’s about supporting every sort of family.”

What have this Government, in collusion with their friends from the Liberal Democrat party, done to support families? For a start, what have they done to support children? The so-called emergency Budget and the spending review take away almost £7 billion from funds to support children, three times the amount the bank levy is estimated to raise. According to the Institute for Fiscal Studies, families with children will lose the most from what this Government plan to do by 2014-15. The poorest 10% of families will lose 7% of their income. The Government are freezing child benefit, cutting child care tax credits, restricting the Sure Start maternity grant to just the first child and, of course, axing the child trust fund and the health in pregnancy grant under the Bill that we have considered today.

What about when the children get a bit older? Education maintenance allowances are being abolished, school spending per pupil is being cut in real terms and the IFS has said that the pupil premium could widen funding inequalities. As the End Child Poverty campaign said after the comprehensive spending review, it was

“a dark day for any family struggling to stay out of poverty, or deep in it already and fearing things will get worse still.”

[Guy Opperman (Hexham) (Con)]

Will the hon. Lady give way?

[Kerry McCarthy]

I am afraid I do not have time.

What about the impact on women? Our research has shown—we have had to do our own research, because this Government seem to have abandoned any notion of doing real and meaningful equality impact assessments, and I pay tribute to my right hon. Friend the Member for Normanton, Pontefract and Castleford (Yvette Cooper) for her work on it—that the cuts hit women twice as hard as men, without considering the impact of cuts to public services. We know that 65% of public sector workers are women and that two thirds of the public sector redundancies arising from the spending review are expected to be women.

Of the £16 billion cuts in total, £11 billion comes from women. Some 72% of the emergency Budget cuts will be met from women’s income, and in the CSR cuts £5.7 billion will be taken from women compared with just £2.7 billion from men. A million more women claim housing benefit than men, 70% of tax credits are paid to mothers, 94% of child benefit is paid to mothers and 90% of lone parents are women. So much for being family friendly. So much for looking after every sort of family. So much for doing everything they can to support the family.

My hon. Friend the Member for Chesterfield (Toby Perkins) stole my line earlier when he talked about the Government believing in women and children being first when it came to cuts. The phrase “women and children first” comes from a mariners’ saying when a ship is doomed to sink, and what we are discussing today is just the tip of the iceberg.

The Bill might be tiny in terms of written content—it is just three pages and four clauses—but it does a huge amount of damage. It scraps the support that we have given to families to help them save through the saving gateway. It scraps the chance a child from a poor family had to enter adult life with a little pot of money to help them fulfil their dreams and ambitions, something that hon. Members on the Government Benches, with their multi-million pound trust funds, could never hope to understand. It snatches away money from pregnant women—money that was designed to help them have healthy, happy pregnancies and healthy, happy babies.

We on the Labour Benches will carry on fighting for those families and for children who were not born with a silver spoon in their mouth, and we will oppose the Bill tonight.

21:48

[The Economic Secretary to the Treasury (Justine Greening)]

As we have heard, this has been a vigorous debate and I am very grateful to all the Members who have contributed. The discussion has been wide-ranging and I want to start by addressing some of the wider arguments that have been made before moving on to some of the more detailed points about measures in the Bill. I shall try to cover all the speeches, although they were numerous.

My hon. Friend the Financial Secretary set out at the start of the debate the rationale behind the Bill and the role that it will play in our plan—a clear and credible plan—to reduce our budget deficit. Some Members have argued today that our plans move too fast, but our deficit is unprecedented and unsustainable so we must take action to tackle it. That action is supported across the world. Only today, Standard and Poor’s, the credit rating agency, stated that the coalition parties

“have shown a high degree of cohesion in putting the U.K.’s public finances onto what we view to be a more sustainable footing”.

It is simply untenable for Labour Members to spend yet another debate, yet another afternoon and yet more hours in refusenik mode arguing about what they do not like, while setting out no plans for what they would do instead.

We are spending £43 billion this year—£120 million a day—on the debt that the Government have inherited. The Labour party wants to airbrush that amount out of our financial worries, but that is simply not possible. Failing to act now would risk higher interest rates, higher mortgage rates, higher rates of business failure and higher unemployment. The Labour party knows all about higher unemployment, having again left unemployment higher when it left office than when it came in.

[Toby Perkins]

The Minister just said that higher employment is something that the Labour party knows all about. I do not know whether she is aware that unemployment was up near the 4 million mark under a Conservative Government. What does she consider to be a successful level of unemployment this time?

[Justine Greening]

The hon. Member for Edinburgh East (Sheila Gilmore) talked about judging Governments based on what they do. The previous Labour Government left unemployment around 400,000 higher when they left office than when they came in. I do not know what the hon. Member for Chesterfield (Toby Perkins) has to say to those people who were unemployed when the previous Government left office, but those people must be very pleased that the Labour Government are no longer in office taking bad decisions.

Today Labour Members have discussed fairness, but there is nothing fair about failing to tackle the deficit. They have discussed it being unfair to end eligibility for the child trust fund, but there is nothing fair about asking future generations to pay our debts, which is simply unacceptable. It was the ultimate irony to spend the afternoon listening to Labour Members discussing the value of saving, when the Labour Government left office with our savings ratio at an all-time low, as we have heard. A savings culture was nowhere to be seen in the Labour Government. If they had demonstrated a little bit more of that culture themselves, the rest of the country might have followed suit.

[Fiona Mactaggart]

On savings, the previous Conservative Government presided over five years of double-digit inflation and double-digit interest rates.

[Justine Greening]

I am sure that it suits Labour Members to talk about the past, but we want to talk about sorting out the future. The hon. Lady has mentioned interest rates, but surely she accepts that the biggest risk to interest rates is not tackling our fiscal deficit, and this Bill is part of our plan to do that. The former Chief Secretary to the Treasury, the right hon. Member for Birmingham, Hodge Hill (Mr Byrne), said, “There’s no money left.” For once, he was right.

The changes that we are making to child trust funds, the decision not to introduce the saving gateway and the abolition of the health in pregnancy grant will save us £370 million in this financial year, around £700 million next year and around £800 million each year from then on. That money can be used to reduce the deficit or to fund our country’s priorities today. We could not afford to spend £500 million of that money on the child trust fund, where it would have been locked up for 18 years. We want to help disadvantaged children now, which is when they need our help, and it was simply wrong to defer that help for 18 years.

We could not afford to introduce the saving gateway in July this year, at the point when we needed to start reducing the deficit, and we could not afford to continue spending £150 million on the health in pregnancy grant to every pregnant woman, whatever their income, whatever their need and however they wanted to spend it. Those policies were simply unaffordable given the fiscal challenge that we face, so we needed to take action.

I want to address some of the issues that hon. Members have raised, but let me first touch on child trust funds. A number of Opposition Members seem to be under the impression that people will no longer be able to pay into their children’s trust funds, but that is not correct: people will be able to continue saving on behalf of their children. As my hon. Friend the Financial Secretary said earlier, we will introduce a new account allowing parents a clear and simple option to save for their children, while saving more than half a billion pounds from child trust funds. In the same way, we will not continue to pay the untargeted, unfocused health in pregnancy grant, but we will continue the Healthy Start scheme, which is targeted at those who need it most and which ensures that people spend their vouchers on milk, fresh fruit, vegetables and vitamins.

Let me briefly cover some of the points that have been made. The hon. Member for Walthamstow (Stella Creasy) talked about the need to maintain policies to ensure that parents can still save on behalf of their children and pass an asset to them when they reach the age of 18. First, child trust funds that are already open will still be a vehicle that parents can use to save. Only today, my hon. Friend the Financial Secretary launched details of a new tax-free savings account for children. The hon. Lady mentioned the Children’s Mutual society, which very much welcomes the announcement that we have made today. It says:

“we absolutely welcome any product that promotes”

the idea of saving efficiently on behalf of children. I hope that she will welcome what it says about our plans. So we will continue to help parents and children to save and I simply do not accept the accusation that the new accounts will be of no use to people on lower incomes. The aim of the accounts is to provide people with a clear, simple way of saving for their children and we want to ensure that they will be accessible to people on lower incomes. The accounts will also allow savings to be locked up until children reach adulthood, so this is not about giving wealthy families a tax break.

The important issue of looked-after children has been raised. The details of any new tax-free account that is launched have yet to be agreed, and, as I said in the Westminster Hall debate last week, I am open to suggestions from hon. Members and others about how we can ensure that local authorities with parental responsibilities for looked-after children play their role in contributing in this area.

I congratulate the hon. Member for Erith and Thamesmead (Teresa Pearce) on her imminent grandchild and I assure her that a child born today will still be eligible for the child trust fund. Her daughter will have got the health in pregnancy grant and if this is her first child she will be eligible for something that has not been mentioned today—the Sure Start maternity grant.

I hope that I have dealt with the specific points that have been raised and I conclude by returning to the wider point of the Bill. If we had carried on with these policies, our plans for reducing the deficit would have meant finding £3 billion of extra spending cuts elsewhere. Instead, these actions, alongside other difficult decisions, enable us to protect critical areas such as health, spending on schools, tackling the welfare state that currently traps people in poverty, laying the foundations for growth in our economy and creating more of the jobs that will ultimately help us to get the economy back on track. I commend the Bill to the House.

Question put, That the Bill be now read a Second time.

21:59

Division 101

Ayes: 318

---

Conservative: 268
Liberal Democrat: 49

Noes: 224

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Labour: 210
Democratic Unionist Party: 5
Scottish National Party: 4
Independent: 2
Social Democratic & Labour Party: 1
Plaid Cymru: 1
Green Party: 1

Bill read a Second time.

Savings accounts and health in pregnancy grant bill (Programme)

Motion made, and Question put forthwith (Standing Order No. 83A(7)),

That the following provisions shall apply to the Savings Accounts and Health in Pregnancy Grant 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 11 November 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 one hour before the moment of interruption on the day on which those proceedings are commenced.

5. Proceedings on Third Reading shall (so far as not previously concluded) be brought to a conclusion at the moment of interruption on that day.

6. Standing Order No. 83B (Programming committees) shall not apply to proceedings on Consideration and Third Reading.

Other proceedings

7. Any other proceedings on the Bill (including any proceedings on consideration of Lords Amendments or on any further messages from the Lords) may be programmed.—(Mr Newmark.)

Question agreed to.

Business without Debate

Tuesday 26th October 2010 Commons Chamber

deferred divisions

Motion made, and Question put forthwith (Standing Order No. 41A(3)),

That, at this day’s sitting, Standing Order No. 41A (Deferred divisions) shall not apply to the Motion in the name of Justine Greening relating to Excise.—(Mr Newmark.)

Question agreed to.

delegated legislation

Motion made, and Question put forthwith (Standing Order No. 118(6)),

Excise

That the Alcoholic Liquor Duties (Definition of Cider) Order 2010 (S.I., 2010, No. 1914), dated 27 July 2010, a copy of which was laid before this House on 27 July, be approved.—(Mr Newmark.)

Question agreed to.

[Mr Speaker]

Just before I call Mr David Amess, can I please appeal plentifully and strenuously to right hon. and hon. Members who are leaving the Chamber to do so quickly and quietly, so that we can hear the hon. Gentleman?

Maternity Services

Tuesday 26th October 2010 Commons Chamber

Motion made, and Question proposed, That this House do now adjourn.—(Mr Newmark.)

22:14

[Mr David Amess (Southend West) (Con)]

When I applied for this Adjournment debate, I did not anticipate quite the level of interest that there appears to be from colleagues, because I did not want to talk about specific constituency matters; I wanted just to draw to the House’s attention to one or two general midwifery matters. So all I would say, Mr Speaker, is that I hope that colleagues will be fortunate enough to catch your eye.

There can be no more personal, emotional or exhilarating experience than watching a baby being successfully delivered. I had the privilege of watching each of my five children being brought into this world, and the sense of wonder and excitement is very personal and unique to everyone, but I am much more comfortable observing babies being born than having to deliver one. It is extraordinary how some members of the animal world seem to have babies so much more easily than human beings do.

However, the point that I really want to make is that from a woman’s perspective, there can be nothing more personal than the relationship that a lady having a baby has with the midwife. Indeed, when our five children were born, I represented Basildon, and so strong was our relationship with the midwife, a wonderful lady called Ladze, that she ended up being godmother to all our children.

Despite some improvements in the national health service’s maternity provision in recent years, much more must be done to ensure that women throughout the United Kingdom receive the best care possible. For those and many other reasons, I want the House tonight to consider how best we can value and support the work of our wonderful midwives.

Let me say immediately that Southend’s maternity services are absolutely splendid. Indeed, their quality was recognised in the Healthcare Commission’s report into maternity services in the UK, in which Southend University hospital was rated one of the very best in the country. Indeed, I have just heard that I have become a member of the Royal College of Midwives parliamentary panel. It is unpaid and voluntary, but I declare it as an interest. As I am sure that all colleagues will agree, midwives throughout the country provide an absolutely invaluable service.

Recently, when I was privileged enough to undertake voluntary service overseas in the Philippines in order to support Filipino nurses, I went to a village in Ifugao, and there at first hand I witnessed just how difficult it is for some ladies to deliver babies. Our services in the UK are somewhat better than those in the Philippines, bearing in mind the challenges that are faced there, but we could still do much better.

Relations between midwives and consultants must be strengthened, and I say to my hon. Friend the Minister that more training should be available to midwives. Although the previous Government claimed some success in introducing consultant midwives in 1999, by 2009 there were only 59 throughout the United Kingdom—just not enough.

Midwives throughout the country are anxious about the outcome of the review of their pensions. The NHS pension scheme hands billions of pounds over to the taxpayer. Indeed, more is paid into the fund than is paid out to pensioners. In the past five financial years, the scheme has handed over £11.3 billion in surplus to the taxpayer, thereby helping, not hurting, public funds.

I congratulate my hon. Friend Baroness Cumberlege on the work that she did when she was a Health Minister in 1993. The report that she produced, “Changing Childbirth”, is as relevant today as it was back then. Furthermore, the work of the Royal College of Midwives, under its very capable general secretary, Cathy Warwick, must be acknowledged. This organisation, which represents 95% of all practising midwives in the UK, does wonderful work that helps women and newborns across the country. The NCT has also given me an excellent briefing on this subject and I know that it supports the points that I wish to raise this evening.

There has been a decade-long baby boom, with 100,000 more babies born last year than in 2001. Rises in the number of midwives have gone some of the way towards catching up with this extra demand. Indeed, there has been an increase of 2,000 in the number of midwives in the last three years and more than 600 more places for student midwives than there were four years ago. However, those extra midwives have largely been swallowed up by the need to provide valuable one-to-one care in labour. This means post-natal care remains woefully inadequate. Extra demand has also come from growing complexity. Mothers are increasingly younger or older than before, and some mothers have serious weight problems. The conception rate for women aged 40 to 44 has doubled since 1991, while the teenage pregnancy rate in the UK remains the highest in western Europe. There have also been significant increases in multiple pregnancies and pregnancies to women with medical conditions that would previously have precluded childbirth. The caesarean section rate is also at a historically high level—just shy of one in every four births. More midwives would help to provide women with the level of antenatal care that would prepare them properly for labour and birth.

Currently we are almost 4,800 full-time equivalent midwives short, based on calculations using established midwifery work force planning tools. For too long, maternity services were not a priority within the NHS: spending on maternity care as a proportion of the NHS budget fell from more than 3% in 1997 to below 2% in 2006, and the share of the NHS work force made up of midwives fell throughout the Labour years. Indeed, while in 1997 there were more midwives in the NHS than there were managers, after 12 years of a Labour Government, by 2009 there were 18,000 more managers than there were midwives—a ridiculous situation. The contrast in what has happened to the two work force groups illustrates how focus may have slipped away from clinical care on to performance monitoring and the dreaded targets. It is the task of the new Government to ensure that midwives do not continue to be sidelined, that their work is valued and that focus returns to good quality patient care.

Aside from resources, however, is the question of policy. The recent White Paper promises that the Government will extend maternity choice but there are questions about how it will be achieved. Although the Labour Government often said the right things and made many promises in relation to choice, they failed to deliver. Progress in implementing choice for women throughout pregnancy, childbirth and the post-natal period was impeded by a lack of sustained investment in maternity services; insufficient recruitment of midwives; and a lack of prioritisation on the part of many commissioners and providers of maternity services. It is easy to assume that it saves money to consolidate, but I do not believe that in the medium to long term that is true.

The main issue with choice is location—the options being birth in a consultant-led unit in a hospital; birth in a midwife-led unit, which may or may not be on a hospital site; and birth at home. A midwife can handle more births in a year in a midwife-led unit or at home than in a hospital, so it is an issue of efficiency as well as choice. Capital investment to provide more midwife-led units is vital, but sadly the total number of such units has dropped significantly in the last two years.

The price of getting maternity care wrong is extremely high, as the cost of litigation shows, and in a time of austerity these are costs that the country simply cannot afford. Of the 100 biggest damages payouts made under the clinical negligence scheme for trusts, 79 derived from obstetric care, and of the total £3 billion paid out in damages under the CNST, almost £1.4 billion was down to claims deriving from obstetrics. Cutting corners in maternity care carries a heavy human and financial cost.

In conclusion, the Prime Minister has admitted that the profession is “stretched to breaking point”, “overworked” and “demoralised”. During the election, all three parties agreed that more midwives were needed to cope with the continuing shortfall. Rightly, the NHS was shielded from cuts in the comprehensive spending review, and this protection should mean that the Government can provide enough midwives to deliver the level of maternity care that women and newborns expect and thoroughly deserve.

[Several hon. Members]

rose—

[Mr Speaker]

Order. I understand that the Members seeking to catch my eye have the agreement of both the hon. Member for Southend West (Mr Amess) and the Minister.

22:26

[Caroline Dinenage (Gosport) (Con)]

I will be brief, Mr Speaker. I just wanted to reiterate what my hon. Friend the Member for Southend West (Mr Amess) said. My constituency has a midwife-led maternity unit, Blake ward, at Gosport war memorial hospital, but it has been shut down temporarily on the basis that there are not enough midwives to cover the area. They have all been put into the Queen Alexandra hospital in Portsmouth. I am concerned about that because Gosport is a peninsula serviced by the A32, which is an unbelievably difficult road at the best of times, and I am worried that babies will be born somewhere along the road or on a roundabout.

I desperately wanted to bring that to everyone’s attention, particularly the Minister’s. The ward has only been shut until January, but this follows an incident earlier in the year when the birthing pool was shut down. Now the ward has been shut down temporarily because of a baby boom caused by the snow earlier in the year. I sometimes feel that these are closures by stealth and that eventually the ward will be shut permanently. It is important that everyone understands the huge importance of these wards, particular the midwife-led maternity units, and especially in areas such as Gosport, which has high levels of social deprivation.

22:28

[Jason McCartney (Colne Valley) (Con)]

I congratulate my hon. Friend the Member for Southend West (Mr Amess) on securing this Adjournment debate. Maternity services are an emotional and controversial topic in my constituency, because Huddersfield royal infirmary consultant-led maternity services closed in August 2008. Mums now have to be transferred to Calderdale hospital if there are complications during birth. Many mums are opting for Halifax just to be safe. There is a new midwife-led unit at Huddersfield royal infirmary, but mums want specialist and emergency care available there too. In an emergency, the time it takes to travel to Halifax can be the difference between life and death for mother and baby. Many Departments of the coalition Government are championing localism, and rightly so. I therefore plead with the Minister to reconsider restoring full maternity care close to where mums need it most.

22:29

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

In a few months, if the current plans proceed, there will be no consultancy-led maternity service at Maidstone hospital in my constituency, which means that every year, 2,000 mothers will be put at greater risk, and lethal consequences could follow. Maidstone is the county town of Kent, and is a growth point area. There are many areas of multiple deprivation, and we have high rates of teenage pregnancy, so we need a full maternity service. Our community has spoken out loud and clear against the reconfiguration plan. Thousands have signed petitions saying no. Our borough and county councillors have said no. The business community has said no. As a local resident and mother of two, I have said no, and in a survey with a 77% response rate, 97% of our GPs also said no.

We are not people who are resistant to change. We are not asking for anything new; we do not want anything extra. We simply want to retain our existing services, and make safe and genuine choices for our people. Choice, we are told by the trust, will be available to Maidstone mothers for the first time, but the choice is between a midwifery-led birthing unit with six beds for the county town of Kent, serving 250,000 people, or travelling to Pembury, Medway, Ashford or Dartford. However, mums with complications will have no local choice, and neither will mums needing an epidural, mums needing a caesarean section or mums who just want to know that they will have the best expertise and equipment available to them when their baby decides to come. The trust says that patients will vote with their feet, but it does not tell people that, if they want to remain in Maidstone, they cannot do so.

I have with me a bundle of letters to the Secretary of State for Health signed by more than 100 GPs in the Maidstone area. They say that the new journey times, over bad rural roads, are unacceptable. They say that the extra risk and stress to mothers in labour is unacceptable. Those GPs also say—this is really worrying—that it is a near certainty that some babies born in Maidstone may die or suffer brain damage while en route to Pembury or elsewhere. They are our GPs: they know exactly what they are talking about. They have voted. They have put their names down and they are saying no. They are talking about our mothers, our children and our babies. The campaign has been going for about two and a half to three years while I have been involved. It is about community, choice and safety. The evidence against downgrading is powerful and profound. The reconfiguration plan is very wrong and dangerous, and it will lead to fatalities. I urge the Secretary of State to reject the reconfiguration plan when he considers the matter imminently.

22:32

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

I will come to the speeches by other hon. Members when I have dealt with—that sounds awful, —my hon. Friend the Member for Southend West (Mr Amess).

I am aware that my hon. Friend has maintained an active interest in this issue for many years, and I congratulate him on securing the debate. I should like to start by agreeing with him that there is nothing in the world more wonderful than a baby being born. I have given birth to four children, at four different hospitals. As is the case for many parents, having a baby was the most amazing thing that has ever happened to me. Getting elected to this House was a close second, but nothing compares to giving birth.

Maternity care is so much more than a new arrival in the family. Pregnancy is a vital time for health promotion, and a time when parents are receptive to information and advice, and motivated to do the best for their children. For some of the more hard-to-reach people in our communities, pregnancy is one of the first opportunities that health service professionals have to talk to them about bringing up children, as well as about their own health and well-being. The impact that midwives can have is significant. Midwives and our maternity services can help us to tackle issues such as nutrition, physical activity and health inequalities, which are some of the biggest public health issues that we face. Later this year, the Government will publish a public health White Paper setting out more detail, but there is no doubt that pregnancy and childbirth are golden opportunities.

The Government set out their long-term vision for the future of the NHS in the “Equity and excellence: Liberating the NHS” White Paper. We are committed to extending choice in maternity, to enable women and their families to make safe, informed choices throughout pregnancy and about childbirth. Maternity networks will help to make this a reality. They will extend choice by encouraging providers to work together to offer expectant mothers and their families a broader choice of maternity services and to facilitate a woman’s movement between the different maternity services that she might want or need. Networks will also need to work closely with health visitors to ensure the very best support for families at this vital early stage in their child’s life. The extra 4,200 new health visitors that we plan over the lifetime of this Parliament will complement the work of maternity services to improve support for all new families and help to ensure extra support for those who need it most. The White Paper consultation period closed earlier this month and we are now considering the responses from the various royal colleges, stakeholders and the public.

I should like to join my hon. Friend the Member for Southend West in commending the work of the Royal College of Midwives, of Cathy Warwick and of all those who have gone before us. He mentioned the noble Baroness Cumberlege’s work on the “Changing Childbirth” report. That document has stood the test of time, with its insight into what is needed during this special time for families. I should also like to join the praise for the National Childbirth Trust. I am proud to say that I was chairman of its Hackney and Islington branch many years ago, when my first child was born. I certainly know only too well the contribution that it makes to many families.

Women and families who are well informed about the maternity care options available to them are more likely to receive the care that meets their particular needs, to feel more satisfied with their care and to feel confident about the transition to parenthood. In recent years, maternity services have faced increased challenges, including a rising birth rate and an increase in complexity in pregnancies. Demographic changes in childbearing, such as more women giving birth at a later age, increased rates of heart disease and obesity, and more births to mothers born outside the UK have resulted in a greater number of higher-risk births. We welcomed the recent guidelines produced by the National Institute for Health and Clinical Excellence on pregnancy and complex social factors.

[Stephen Lloyd (Eastbourne) (LD)]

Will the Minister confirm that the organisations that she has mentioned, including the National Childbirth Trust, all emphasise, as my hon. Friends have done this evening, that a key part of pregnancy and maternity services is that they should be close to the mothers-to-be? I believe that that is a clear objective of the White Paper, as well as of many of the organisations and groups that have been mentioned. Will she confirm that that will be a thread running through the findings of the White Paper when they finally come before the House in the form of a Bill?

[Anne Milton]

Absolutely. Proximity to the people for whom we are trying to design services to meet their needs is vital.

I should like to mention the Marmott review, “Fair Society, Healthy Lives”, which highlighted the strong associations between the health of mothers and the health of their babies. It also pointed to equally strong associations between the health of mothers and their socio-economic circumstances. This means that pre-conception care and early intervention before birth are as important as support during and after the birth. We need women to access maternity care early and for that to continue, exactly along the lines that the hon. Member for Eastbourne (Stephen Lloyd) suggests.

Family nurse partnerships will be extended so that we can provide the highly targeted, highly specialised support through pregnancy and the first years of life that the most vulnerable young families need. Our vision is for all women to have choice and equity of service standards and quality of care, wherever in England they are receiving care. However, we know that, in practice, not all women are offered a choice. “No decision about me without me” is what this is all about. It is about giving people the opportunity and support to make the choices that will make a difference to them, their babies and their families. It is also about giving them the information they need to exercise control, and of course the confidence to use it. Not all families find that easy.

The new outcomes framework proposes five national outcome domains covering all treatment activity across effectiveness, patient experience and safety. A number of indicators for maternity and children were proposed, including maternal death, infant mortality and the unexpected or unplanned admission of term babies to neonatal care. The consultation period has now closed and we are considering the responses. I hope that that will deal with many of the issues that have been raised this evening.

Midwives and the maternity team use their skill and compassion to help parents-to-be along their journey—a vital journey—to parenthood. We will make sure that any changes in services are led by local clinicians, patients and service users. The NHS White Paper is all about giving control of health services to the clinical staff who deliver them. My hon. Friend the Member for Maidstone and The Weald (Mrs Grant) spoke passionately about that this evening.

Effective skill mix in the maternity work force will be important. The NHS is focusing increasingly on utilising the whole maternity team and helping to use innovation and new technology to drive up the quality of care and deliver value for money.

In the next few months, we will receive information about women’s experience of maternity services from surveys conducted by the National Perinatal Epidemiology Unit and the Care Quality Commission. These survey results will give us a clear and up-to-date picture of what women think about the maternity services they receive and what more needs to be done.

My hon. Friend the Member for Gosport (Caroline Dinenage) raised local concerns about the closure of the Blake. Although I am assured that it is due to open again in January next year, I know how very unsettling it is to have local services closed. It causes a loss of confidence among local people.

My hon. Friend the Member for Colne Valley (Jason McCartney) raised the closure of services in his area. I am sorry, but sadly we cannot always turn back the clock. I am delighted to hear that a new midwife-led unit has opened and I hope it will be possible to provide people with the services they need.

As I have already said, my hon. Friend the Member for Maidstone and The Weald also raised some constituency issues. Nobody but nobody could have done more or have campaigned harder on those issues. I know that the Secretary of State asked the strategic health authority to report to him at the end of September, and he now has that report. I am sure that my hon. Friend will agree that the Secretary of State must be allowed some time to consider the report’s content.

I thank my hon. Friend the Member for Southend West for calling this debate. He has raised a number of important points about maternity care and the provision of maternity services. Our White Paper gives us the chance to refocus the NHS on what is important to its users and staff, providing those services so that we achieve the results that are important to them—ensuring that all women and their families have access to the best possible care at this crucial time in their and their family’s lives.

Question put and agreed to.

22:42

House adjourned.