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Dr Julian Lewis (New Forest East) (Con)
1. What assessment he has made of the potential effects on UK interests of the creation of an economic government of the Eurozone.
The Chancellor of the Exchequer (Mr George Osborne)
We have had positive gross domestic product numbers this morning, but the biggest single boost to the British economy this autumn would be a lasting resolution of the euro crisis. Such a resolution requires, among many other things, greater fiscal integration within the eurozone as it follows the remorseless logic of monetary union. We have made it clear that Britain will not be part of that fiscal integration, and that issues affecting Britain, such as the single market and financial services regulation, must continue to be decided at EU level.
Dr Lewis
If the Liberal Democrats had had their way, we would have joined the euro with disastrous consequences. Now, the liberal Conservatives are advising us to support fiscal union in the eurozone, which will lead to economic union and a single government. How does my right hon. Friend really feel about a policy undermining the system of democratic states in Europe that gave the continent peace for more than half a century?
Mr Osborne
Those who were against Britain joining the euro, including my hon. Friend and me, were against it partly because we felt that it would lead to greater fiscal integration. That was one of the arguments for keeping Britain out. There is a remorseless logic driving monetary union towards greater fiscal integration, but it is in Britain’s overwhelming economic national interest to have stability in the eurozone, so I think that that fiscal integration is part of what is required. Of course, we have to ensure that Britain’s interests are protected, that we are not part of that fiscal integration, and that issues such as the single market and financial regulation are conducted at the level of the 27.
Mr Wayne David (Caerphilly) (Lab)
The Chancellor talks a great deal about fiscal integration in the eurozone, but will he tell us precisely what he means by fiscal integration?
Mr Osborne
We shall see the 17 members of the euro attempting to co-ordinate their budget policies better, and more mutual surveillance, with sanctions, for those who do not do what has been agreed. I have to say that the confusion, if there is any, is in Labour’s policy, because it is now holding open the prospect of membership of the euro, which would be the ultimate fiscal and monetary integration.
Mr Andrew Tyrie (Chichester) (Con)
Does the Chancellor agree that it is wholly unacceptable that the rest of Europe should be held to ransom by Greece? What would be the consequences for the UK and the eurozone of a no vote in a Greek referendum?
Mr Osborne
There is no doubt that the decision by the Greek Prime Minister has added to the instability and uncertainty in the eurozone. We can see that today. We are trying to create stability and certainty in the eurozone. Ultimately, it is up to the Greek people and the Greek political system to decide how they make their decisions, but I believe that it is extremely important for the eurozone to implement the package that it agreed last week. I said at the time that that was crucial, as did everyone else involved. We need to get on with it, sooner rather than later.
Kevin Brennan (Cardiff West) (Lab)
Is not the truth that the Chancellor cannot urge any real action in the eurozone because he is stuck with a failed plan that has resulted in our economy bumping along the bottom? It will take more than him wearing a high-visibility jacket on the rolling news to put that right.
Mr Osborne
As I was saying, this morning we had the news that our GDP is growing by 0.5%—[Hon. Members: “Ooh!”] Well, GDP fell by about 6% when Labour was in office and when the right hon. Member for Morley and Outwood (Ed Balls) was advising the last Prime Minister. If we look at growth in France or Germany, the most recent figures show that it was either negative or growing at about 0.1%. The instability in the eurozone and the uncertainty in the world are having an effect on all western economies at the moment, and we have to sort that out, but that is not an excuse for Britain not to deal with its problems, which were created by that lot sitting over there.
Mr John Redwood (Wokingham) (Con)
Will my right hon. Friend ensure, if he is not using our veto against more fiscal integration, that Britain gets something out of the deal? Do we not need the right to opt out of any past or future EU measure that could damage jobs and prosperity at home?
Mr Osborne
We have already extracted a price for the European Stability Mechanism treaty that the eurozone wants to put forward by getting ourselves out of the EU bail-out mechanism to which the last Government had committed us. We are working to keep the increase in the EU budget to a real freeze. In other words, we have, I think, proved in office that we can extract important concessions and in the case of the EU bail-out fund we have actually taken a power back to Britain. That will be the approach we take to future discussions and negotiations—putting Britain’s national interest first.
Chris Leslie (Nottingham East) (Lab/Co-op)
Why did the Chancellor’s statement last Thursday about economic governance in the eurozone fail to mention the most important missing ingredient—a strategy for jobs and growth? Was it an accident or was it deliberate? He has been telling us all summer that Britain is a safe haven, yet growth is weak, unemployment is rising and construction and manufacturing are both contracting. What kind of safe haven is that?
Mr Osborne
First, may I congratulate the hon. Gentleman on keeping his job in the clear-out of the Labour Treasury Front-Bench team—although on the basis of that question, I am not sure why he did? The whole purpose of our negotiations in Europe and the whole purpose of what we are doing at home is to stabilise the British economy and set it on a path of growth and jobs. We inherited a situation where unemployment had rocketed under the Labour Government and we had the deepest recession of any country in the world, apart from Japan. We are rescuing that situation, and it is reflected in the very low interest rates paid in this country in comparison with all those other countries.
Chris Williamson (Derby North) (Lab)
2. What assessment he has made of the effects of the 2011 Budget on long-term unemployment.
Mr Kevin Barron (Rother Valley) (Lab)
12. What assessment he has made of the effects on unemployment of the outcome of the comprehensive spending review.
The Chief Secretary to the Treasury (Danny Alexander)
The independent Office for Budget Responsibility published its forecast for unemployment in March. Unemployment is a serious problem for the UK, with about 1 million people continuously on out-of-work benefits for more than a decade. This Government have introduced a number of reforms to the welfare system, including the Work programme—the biggest single payment-by-results employment programme this country has ever seen, which is expected to help 2.4 million claimants over the next seven years.
Chris Williamson
The Chief Secretary should stop being so complacent about long-term unemployment. The truth is that this Government are spending more to keep people on the dole and they are losing income from tax revenues that would otherwise be paid on income tax and VAT. Is it not time that the Government adopted a plan for jobs and growth to get the economy moving again? The right hon. Gentleman could do worse than adopt Labour’s five-point plan for economic growth and avoid the spectre of stagflation for years to come.
Danny Alexander
I am not sure that Labour’s five-point plan would help the British economy, given that it involves spending an extra £20-odd billion, putting at risk the fiscal credibility that is so important to maintaining employment in this country. Nor do I think the hon. Gentleman should be so critical of the Work programme, which after all is designed to tackle the legacy of 1 million people who have been out of work for more than 10 years—a legacy for which his party is responsible.
Mr Barron
Is it not true that the increase in unemployment caused by the comprehensive spending review is a heavy burden both for the individuals and the families concerned and for the economy? What does the Minister say to the fact that the Government have had to borrow £46 billion more this year than they were planning to borrow?
Danny Alexander
The right hon. Gentleman is absolutely right that unemployment is a heavy burden for any individual or any family. We inherited from Labour the largest budget deficit this country has ever seen. It was incumbent on this coalition Government when we came into office to take the action necessary, otherwise we would have found ourselves in a position that many other European countries face, which would have been a great deal worse for the very people the right hon. Gentleman claims to be concerned about.
Karen Bradley (Staffordshire Moorlands) (Con)
One of the key weapons in tackling youth unemployment is the use of apprenticeships, so will my right hon. Friend join me in welcoming the news that in Staffordshire Moorlands the number of apprentices has gone up from 480 in 2009-10 to 760 last year—an increase of 60%?
Danny Alexander
I certainly join the hon. Lady in welcoming that. It will provide significant new opportunities for young people in her constituency. Of course it is part of the increase of 250,000 apprenticeships that this Government have put in place.
Simon Hughes (Bermondsey and Old Southwark) (LD)
After this morning’s encouraging news, does my right hon. Friend accept that one way of maximising employment is to give people the right to have flexible employment if that is what they wish? Given that the coalition agreement pledged to give people the right to request flexible employment, can he report on progress in implementing that commitment?
Danny Alexander
My right hon. Friend is correct, and it is a great shame that Labour Members sneer at the economic growth that has been reported today. As my right hon. Friend says, flexible employment is an important part of that growth. We set out plans in our coalition agreement, and we have announced proposals to implement them by the end of the current Parliament.
Rachel Reeves (Leeds West) (Lab)
I must say that I find the Chief Secretary’s answers incredibly complacent. Given that unemployment is at a 17-year high and long-term youth unemployment has risen by more than 60% since the start of the year, we all know what impact the Chancellor’s policies have had on unemployment. Instead of being complacent, will the Government support calls for them to repeat the bankers’ bonus tax in order to create 100,000 extra youth jobs and to introduce a national insurance holiday for small businesses taking on new workers? That is what Labour has proposed in its five-point plan. We need policies that will get the economy moving again and reduce unemployment, thus reducing the deficit. When will the Government act?
Danny Alexander
The hon. Lady’s position would have more credibility if she recognised the fact that youth unemployment rose during Labour’s time in office, as did long-term unemployment. As for her proposal for a bonus tax, that was written off by the last Chancellor of the Exchequer, who said that it could not work. She should listen to her own colleagues first.
Stuart Andrew (Pudsey) (Con)
3. What steps he is taking to reduce tax avoidance and evasion.
The Chancellor of the Exchequer (Mr George Osborne)
We have made it clear that tax evasion is both illegal and immoral, and that this Government will not tolerate it. We are increasing the number of staff at Her Majesty’s Revenue and Customs who are dedicated to tackling tax evasion and tax avoidance to 2,500. We also aim to increase the amount of tax collected by £7 billion, and, unlike the last Government, we have concluded a treaty with Switzerland to get back the money that individuals should have paid here in the United Kingdom.
Stuart Andrew
I have been contacted by a fair number of constituents who have expressed concern about tax avoidance. I welcome many of the measures that the Government have introduced to tackle this unfairness. Is the scope of the recent tax avoidance agreement between our Government and the Swiss likely to include cases in which tax is not paid by individuals who are tax-exiled in Switzerland, such as the widely reported case of Mr Andrew Rosenfeld?
Mr Osborne
Actually, you just have. You made him your general election strategist. However, I will not comment on the tax affairs of individuals, although I suspect that many will over the coming years.
David Miliband (South Shields) (Lab)
The Chancellor will remember, in his first Budget, fixing a target for debt
“to place our fiscal credibility beyond doubt”. —[Official Report, 22 June 2010; Vol. 512, c. 167.]
That target was for debt to be reduced by the end of the Parliament, but, according to figures from the Office for Budget Responsibility, it depends on economic growth of 2.8%. How far below 2.8% must growth fall for the Chancellor’s fiscal mandate and his fiscal credibility to be shot to pieces?
Mr Speaker
Order. The question refers to a reduction in tax avoidance and evasion.
Mr Osborne
Tackling tax evasion and avoidance—to which the question refers—will help us to reduce both the deficit and the debt. We have the fiscal mandate and the debt target. That has been independently verified by the Office for Budget Responsibility—which is in marked contrast to the situation when the right hon. Gentleman was in the Cabinet—and on 29 November it will provide its update.
Mr Gary Streeter (South West Devon) (Con)
Although we are all in favour of dealing with tax avoidance and evasion, are not some of the heavy-handed tactics used by HMRC to collect tax, including the imposition of late-payment penalties under the Labour Government, helping to stifle some growth in small and medium-sized businesses? Will the Chancellor examine the position to ensure that HMRC is being fair?
Mr Osborne
Of course we always want HMRC to approach things in a proportionate manner, and it certainly handles large companies and their tax bills better than it did several years ago. However, we must collect the tax that is owed. That is a very important principle at any time, and it is particularly important at a time when we are all having to make difficult decisions in our attempts to reduce the budget deficit. We will not tolerate tax evasion, and we do apply penalties to people who do not pay their tax on time.
Owen Smith (Pontypridd) (Lab)
The Chancellor is talking a good game, and yesterday the Exchequer Secretary announced the establishment of an “affluent unit” to tackle tax avoidance. For the sake of clarity, I should add that that is not a pet name for the Tory Front Bench, but a department in HMRC. However, the £900 million is not new money. It is not additional, and nor are the 200 staff. Is not the reality that the Government are more interested in offering tax breaks to the wealthiest than in tackling tax avoidance?
Mr Osborne
This is the Government who have introduced additional charges for long-staying non-doms; Labour had 13 years in which to do that, but they did not. This is the Government who have concluded a tax treaty with Switzerland; the previous Government had an opportunity to do that—[Interruption.] Well, this is what a Europe Minister in the last Government said:
“Swiss…deal offered to HMG…more than decade ago but GB turned it down thus losing billions in revenue”.
They had 13 years to deal with tax avoidance and evasion. We are dealing with it now, while they must account for their new general election strategist.
Fiona Mactaggart (Slough) (Lab)
4. What assessment he has made of the effects of the 2011 Budget on unemployment amongst women.
The Economic Secretary to the Treasury (Miss Chloe Smith)
The Office for Budget Responsibility published its unemployment forecasts in March 2011, taking full account of announcements at Budget 2011, but it does not publish forecasts by gender. The Government are committed to tackling unemployment and helping support women into work. The hon. Lady will be aware that female employment has remained broadly steady since the start of 2008. Employment among women aged 25 to 64 is up more than 100,000 since the start of 2008, and has risen by 15,000 in the last three months.
Fiona Mactaggart
But with both women’s unemployment and the retail prices index at a higher level than at any time since the Chancellor left university—which was probably when the hon. Lady left primary school— [Interruption.] I do not—[Interruption.]
Fiona Mactaggart
I was welcoming a young woman to the Front Bench, and I am glad to see young people representing people in this Parliament, but I do think it is shocking that we currently have the highest level of unemployment in more than 20 years—
Mr Speaker
Order. I just say to the hon. Lady that what I want is a question with a question mark.
Fiona Mactaggart
Is it not time that this Government delivered for women on employment, and may I suggest that support for women entrepreneurs and delivering promises that they made before the election for 3,000 more midwives and 4,000 extra—
Miss Smith
I have a number of things to say to the hon. Lady, none of which would include any personal questions, of course.
I can assure the hon. Lady that the Government are reducing the deficit fairly, and I would point out in particular that we are taking 1.1 million of the lowest-paid workers out of tax entirely, and the majority of them are women. She will welcome that as much as I do. Furthermore, she should know that unemployment rose to its level of 30% under her party’s Government.[Official Report, 3 November 2011, Vol. 534, c. 6MC.]
Claire Perry (Devizes) (Con)
Does my hon. Friend also agree that one of the most important steps this Government have taken is to exempt from the pay freeze the lowest-paid workers in the public sector, 80% of whom are women?
Miss Smith
I certainly do welcome that, and it is important to combine that with taking women out of income tax, as I have already mentioned.
Cathy Jamieson (Kilmarnock and Loudoun) (Lab/Co-op)
May I genuinely welcome the hon. Lady to her new post? I have no doubt that we will have many exchanges across the Chamber, and I hope we will focus on policy.
Back in May, the Minister claimed that the Government’s approach to the economy was working because there were 14 fewer unemployed claimants in her constituency. What is she saying now that women’s unemployment in the UK has risen to its highest rate since 1988, and, more importantly, what is she going to do about it?
Miss Smith
I will tell the hon. Lady what I am certainly going to do about it, which is join the rest of this Government in working on welfare reform, tax reform, child care reform and many other measures that will take women’s unemployment down from its record level, where her Government left it.
Damian Hinds (East Hampshire) (Con)
5. What recent estimate he has made of the size of the structural deficit.
The Chancellor of the Exchequer (Mr George Osborne)
The estimate is that the structural deficit for this year will be 5.3% of GDP, which is down from the record 8.9% in the last year of the previous Government, with it having been the highest in the G7 before the crisis. Of course, these estimates are now provided independently by the Office for Budget Responsibility, rather than being fiddled by the close advisers of the Chancellor and the Prime Minister, as used to happen.
Damian Hinds
Other countries face fierce criticism for their tardiness in addressing not only their immediate deficit, but their growing medium and long-term liabilities. How is progress in that regard for the British Government?
Mr Osborne
We are bringing the deficit down from the record levels that we inherited, which has in part provided stability in the financial markets for sterling and our interest rates. That has been absolutely crucial, as we can see in the very high interest rates faced by not just Greece and Portugal, but now even by countries such as Italy and France, which face significantly higher interest rates than we do. That is of course a huge boost to the British economy.
Graeme Morrice (Livingston) (Lab)
Does the Chancellor think that rising unemployment and growth of just 0.5% in 12 months will make it easier or harder to get the deficit down?
Mr Osborne
This morning’s GDP numbers are a positive step, but of course the British economy has a difficult road to travel from the very high debts—the record debts—that we inherited. That is made more difficult by the international situation, as people can plainly see today, but we are determined to make that journey to the growth and prosperity that this country was so lacking under the previous Government.
Mark Garnier (Wyre Forest) (Con)
6. What recent discussions he has had on social impact bonds.
The Chief Secretary to the Treasury (Danny Alexander)
Important work is going on within both the social investment sector and government to develop and test social impact bond models, and we meet regularly with colleagues to discuss the progress that the Government are making in growing the social investment market, including through social impact bonds.
Mark Garnier
My right hon. Friend will be well aware of the exciting potential that social impact bonds have, not only in offering financial support for the third sector, but in securing genuine savings for the Government. Will he or one of his Ministers meet me and representatives from the Social Finance investment bank to explore ways in which the Treasury can help to maximise the potential of this nascent financial instrument?
Danny Alexander
The hon. Gentleman is absolutely right about the enormous potential of this sector, and I congratulate him on his work and the close interest he has taken in this subject. The Exchequer Secretary to the Treasury would be very happy to meet both him and representatives of the Social Finance investment bank.
Jesse Norman (Hereford and South Herefordshire) (Con)
7. What recent estimate he has made of the level of central Government debt.
Mr Robert Buckland (South Swindon) (Con)
11. What recent estimate he has made of the level of central Government debt.
The Exchequer Secretary to the Treasury (Mr David Gauke)
The Office for National Statistics publishes central Government debt figures monthly. The latest figures released on 21 October gave central Government gross debt as £1.2 trillion or 77.6% of GDP in September. The Government use public sector net debt for their fiscal targets. That figure is also published by the ONS, and it was £966 billion or 62.6% of GDP last month.
Jesse Norman
I thank my hon. Friend for that response. This country continues to bear a huge burden of private finance initiative debt. The Government have made important progress in improving the cost and operation of PFI over the past 18 months. Does he share my view, and that of many of my colleagues, that more can be done to secure a fair deal on PFI, while securing investment in our infrastructure?
Mr Speaker
It would help if the Chair could actually hear the question being asked.
Mr Gauke
My hon. Friend has campaigned tirelessly on this matter. As he knows, the Government have improved the assurance and approval arrangements for PFI, and the transparency. We are seeking to obtain £1.5 billion of savings on existing stock of PFI contracts, and we will of course continue to work hard to improve the situation.
Mr Buckland
With gilt yields at their lowest for 60 years, does this situation not show that the international markets have huge faith in the UK’s debt reduction strategy?
Kelvin Hopkins (Luton North) (Lab)
In 1945, Britain had higher Government debt than now and the Government of that time did not impose cuts but ran a full-employment economy and there was rapid growth. Is it not time that the Government took a leaf out of Labour’s book in relation to running the economy?
Mr Gauke
May I just make the point about the 1945 Government that they were running surpluses from 1948 onwards? If memory serves, the debt in 1945 was 232% of GDP and by 1951 it was 178% of GDP, so they brought debt down. That is not a bad thing to do and this Government want to do it, whereas the Labour party wants to put debt up.
Sammy Wilson (East Antrim) (DUP)
Given the increase in debt caused by the lower growth rates and the impact that that is likely to have on the Government’s deficit reduction plan, what impact does the Minister believe that will have on the United Kingdom’s credit rating? Does he believe that steps need to be taken to inject growth into the economy?
Mr Gauke
It is worth pointing out what Standard & Poor said recently when it confirmed our triple A credit rating. It said that if we abandoned our fiscal plans—if we borrowed more—that credit rating would be at risk. The best way of keeping our triple A rating is by sticking to the plan.
Andrew George (St Ives) (LD)
8. What plans he has to bring forward fiscal measures to support green growth.
The Economic Secretary to the Treasury (Miss Chloe Smith)
The Government are committed to supporting green growth, as is demonstrated by the green investment bank, which was allocated £3 billion in the spending review, by the carbon price floor, which is designed to drive investment in low-carbon power generation, and by the green deal, which supports households and businesses in increasing their energy efficiency at no up-front cost.
Andrew George
May I, too, extend a very warm welcome to my hon. Friend the Economic Secretary?
In the Budget, the Chancellor pledged to consider incentives to encourage take-up of the green deal. One idea is to have a stamp duty particularly for the least energy-efficient homes. How does my hon. Friend intend to advance those incentives and is she prepared to meet me and industry representatives to find a way forward with the Chancellor’s incentives?
Miss Smith
May I take this opportunity to thank my hon. Friend and others for their kind words regarding my role?
As I have mentioned, the green deal is a key part of supporting such green growth and the Government are taking a range of actions to help people to gain control of their household energy bills. I certainly note my hon. Friend’s suggestion and I am happy to meet him to discuss options within public finance constraints.
Mr Pat McFadden (Wolverhampton South East) (Lab)
May I also welcome the new Minister to her post? She will be aware of the importance to the UK economy of energy-intensive industries such as the steel, chemicals and ceramics industries. German competitors in such industries are benefiting from rebates worth more than €5 billion a year; will she consult the Chancellor and make sure that the pre-Budget report includes a special package of measures for those industries so that rising energy costs do not simply result in jobs being exported abroad?
Miss Smith
I know that my right hon. Friend the Chancellor is looking into exactly this and we shall be reporting back on it.
Rosie Cooper (West Lancashire) (Lab)
9. How many firms have participated in the national insurance holiday for new businesses.
The Exchequer Secretary to the Treasury (Mr David Gauke)
As of 25 October 2011, Her Majesty’s Revenue and Customs had received 8,761 successful applications for the national insurance contributions holiday. A breakdown of information by constituency on the amounts claimed and jobs supported for the first year of the scheme will be published shortly in a factsheet in the House of Commons Library.
Rosie Cooper
Could the Minister tell the House how much of the £1 billion allocated for the national insurance holiday has actually been given to businesses?
Mr Gauke
As I say, we will be updating the House with all those details shortly, but there are 1,600 or so businesses in the north-west region that are benefiting from it. I visited one of them not far from her constituency a few weeks ago which was very appreciative of the scheme. Where the scheme is available, I encourage hon. Members to highlight it to their constituents.
Julian Smith
May I urge the Minister to reconsider auto-enrolling new businesses on to the scheme, so that rather than their having to apply for it they are placed on it automatically?
Mr Gauke
We looked at auto-enrolment but one of the difficulties was the fact that it would have been years before we could have put it fully in place and we wanted to move quickly to have the scheme in operation. It is important that we highlight the scheme and make sure that publicity is available and that businesses are aware of it. The businesses that I have met that have taken up the scheme are very appreciative of it and it helps them in those difficult first few months.
Nick Smith (Blaenau Gwent) (Lab)
10. What assessment he has made of the level of economic growth in (a) the UK and (b) other EU members states in the last 12 months.
The Financial Secretary to the Treasury (Mr Mark Hoban)
Eurostat publishes GDP growth data on all EU member states. These data show the UK economy growing in the most recent three quarters. The IMF’s latest forecast shows the UK economy growing this year, and growing faster than the economies of France, Germany and Italy next year.
Nick Smith
The Times says today that the Government’s plans for growth are “piecemeal” and their implementation “patchy”. Given that long-term youth unemployment is up by 60%, do we not need a proper programme for jobs?
Charlie Elphicke (Dover) (Con)
May I welcome today’s excellent economic growth figures, which are well ahead of forecasts at 0.5%? Our growth is just as high as US growth this year, without the massive fiscal stimulus. Is that not right?
Stephen Timms (East Ham) (Lab)
When we embarked on the economic course that the Government have set, Ministers told us that because they were tackling the deficit aggressively, there would be a surge of private sector confidence—and, therefore, investment and jobs. Many people agreed with them. Now that we know that expectation was mistaken, surely there must be a change of course.
Mr Hoban
Every reputable international organisation that talks about what is happening in the UK economy now recognises that the Government need to stick to the course, rather than throwing away the valuable credibility that we have gained as a consequence of tackling the mess left behind by the previous Government.
Andrea Leadsom (South Northamptonshire) (Con)
Does my hon. Friend agree that having our own currency is one of the keys to turning round our economy? Does he share my astonishment that the Labour party does not rule out joining the single currency?
Mr Hoban
It is remarkable, is it not, that when the Leader of the Opposition was asked whether a Labour Government would join the euro, his answer was:
“It depends how long I’m prime minister for.”
This Government have closed down the euro preparations that the Labour party set up, and that is why I think that we have taken the right decision to stay out of the euro and tackle our debt and deficit problems. That is why we have low interest rates, which help strengthen the recovery in this country.
Mrs Linda Riordan (Halifax) (Lab/Co-op)
13. What fiscal measures he is implementing to address youth unemployment.
The Exchequer Secretary to the Treasury (Mr David Gauke)
The 2011 Budget announced a £200 million package of support, including 100,000 work experience opportunities for young people, skills training, guaranteed interviews and progression into apprenticeships. This is in addition to the £7.6 billion that we are investing in education and training for 16 to 19-year-olds this year and the £1.4 billion that we are investing in apprenticeships. Young people will also benefit from priority access to the Work programme, which started in June.
Mrs Riordan
What my constituents want is action rather than words, especially on youth unemployment, which stands at nearly 10% in Halifax. When will the Government take real measures to get young people into work and contributing to the economy and society in a positive way?
Mr Gauke
As I said in my answer, we are introducing more apprenticeships, and young people will have priority in the Work programme. The hon. Lady highlights youth unemployment in Halifax. The last estimate showed that it increased by 0.6% from June 2010 to March 2011—but I also have to point out that from 2004 to 2010, youth unemployment increased by 8.5% in Halifax.
Matthew Hancock (West Suffolk) (Con)
Does the Minister share my concern that even during the boom years youth unemployment rose? Will he join me in commending the work placement scheme in Haverhill in my constituency? The work programme and the new flexibility at the jobcentre means that young people can be put into work placements, and more than half of those put in placements end up getting a permanent job.
John Howell (Henley) (Con)
14. What recent representations he has received from the IMF and the OECD on UK economic policy.
The Financial Secretary to the Treasury (Mr Mark Hoban)
The International Monetary Fund and the OECD regularly hold frank bilateral discussions with each member country. When Christine Lagarde, the managing director of the IMF, visited London in September, she stated:
“In the United Kingdom strong fiscal consolidation is essential to restore debt sustainability, given the UK’s very high structural budget deficit and large financial sector relative to GDP.”
Angel Gurria, secretary-general of the OECD, said yesterday of the UK:
“You were successful. You cleared the markets. The package was credible…The markets never discuss the quality of the rating of the UK.”
That is a consequence of the actions this Government have taken to tackle the mess left behind by the previous Government.
John Howell
I thank the Minister for that reply, but what advice has he been given on the consequences of our failing to pay our IMF subscription?
Mr Speaker
Order. The Minister has said enough, and he has said it about another party’s policy. We need to move on.
Geraint Davies (Swansea West) (Lab/Co-op)
Is it not accepted now by the international community that the announcement by the Chancellor a year ago that he would cut half a million public sector jobs led directly to a reduction in consumer demand, and that it has reduced private sector investment and growth and led to an increase in deficit predictions?
Mr Hoban
The hon. Gentleman should recognise that the action that this Government have taken has earned the endorsement of the IMF and the OECD. That is why we have the low interest rates the economy needs. The Opposition talk about a plan B, but that would actually increase the budget deficit and the interest rates that this country would have to pay.
Laura Sandys (South Thanet) (Con)
15. What fiscal measures he is taking to encourage job creation in the private sector.
The Economic Secretary to the Treasury (Miss Chloe Smith)
In Budget 2011 the Government put in place a wide range of measures to support job creation, including supporting business growth by aiming to create the most competitive tax system in the G20, and helping to ensure that it always pays to work, by increasing the personal allowance.
Laura Sandys
I would like to add my welcome to my hon. Friend at the Dispatch Box.
Having run two small businesses, I understand the pressures that small businesses in South Thanet face. How much less will we tax small businesses in the coming years as a result of our tax cuts and the national insurance freeze?
Miss Smith
My understanding is that, compared with the plans of the previous Government, businesses will pay £3 billion less in employer national insurance contributions and more than £1 billion less in corporation tax, as a result of changes announced in Budget 2010.
Alison McGovern (Wirral South) (Lab)
Small businesses have been frequent attenders at my regular Friday surgeries, and they tell me that business is hard. Now that the hon. Lady’s party’s Chancellor has presided over the slowest economic recovery since the first world war, will she explain to small businesses in Wirral how they are supposed to get out of this mess?
Miss Smith
This has been one of the deepest recessions on record, and it is no wonder that times are very hard for people. The hon. Lady must take note of the fact that overall, more than two jobs have been created in the private sector for every one lost in the public sector, which is very clear progress on what her Government left behind.
Lorely Burt (Solihull) (LD)
I know that VAT is a somewhat sensitive subject in this place, but has the Minister made an analysis of the costs and benefits and the jobs that would be created by reducing VAT on building refurbishment materials?
Miss Smith
It is indeed a very good question. I am, sadly, aware that many costs are associated with such a policy, but I would be very happy to discuss such things with the hon. Lady.
Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab)
16. What recent discussions he has had with the Secretary of State for Business, Innovation and Skills on funding for the regional growth fund.
The Chief Secretary to the Treasury (Danny Alexander)
I regularly discuss the regional growth fund with the Secretary of State for Business, Innovation and Skills. Yesterday we announced the outcome of round two of the fund. In total we expect the regional growth fund to support more than 325,000 jobs in the private sector over the next three years.
Tom Blenkinsop
Teesside has not yet received any of its promised RGF funding. The Minister of State, Department for Business, Innovation and Skills, the hon. Member for Hertford and Stortford (Mr Prisk) says that is down to due diligence, which takes an average of between four and six weeks. No one doubts the need for due diligence, but how much is the Chancellor charging businesses that receive RGF funding for seven months of due diligence limbo?
Danny Alexander
The hon. Gentleman will be aware that well over half the projects that were given funding in round 1 are under way, mostly with the private sector funding to start with; the public sector funding will come in later. But I should have thought he would want to welcome the fact that two specific round 2 bids were successful in Middlesbrough in the round that we announced yesterday.
Oliver Colvile (Plymouth, Sutton and Devonport) (Con)
17. What recent assessment he has made of the potential effect on household spending of an increase in interest rates.
The Economic Secretary to the Treasury (Miss Chloe Smith)
The Bank of England is responsible for monetary policy, as my hon. Friend knows, and setting the bank rate to meet its inflation target. Action by this Government in the comprehensive spending review and the Budget put the public finances on a sustainable footing and has supported low and stable interest rates. The higher interest rates seen in other countries highlight the risks when financial markets lose confidence in a Government.
Oliver Colvile
Home owners clearly benefit from having low interest rates, but inflation damages savers and consumers. Will my hon. Friend explain how the Government’s inflation target is set, and the criteria used to review it?
Miss Smith
I shall, by reference to correspondence, that my hon. Friend will be well able to delve into, between the Chancellor and the Governor of the Bank of England, but I note at this point that the Government believe that low and stable medium-term inflation is a prerequisite for economic growth, and that is what drives our policy.
Tony Lloyd (Manchester Central) (Lab)
T1. If he will make a statement on his departmental responsibilities.
The Chancellor of the Exchequer (Mr George Osborne)
The core purpose of the Treasury is to ensure the stability of the economy, promote growth and employment, reform banking and manage the public finances so that Britain lives within her means.
Tony Lloyd
Will one of the Treasury Ministers confirm that public sector workers who work part-time earning less than £15,000 will still pay the 3% income tax? Is this fair, and should not the Government negotiate in good faith, and not simply try to ram this through?
Mr Osborne
The Chief Secretary will shortly set out the full details of our pension offer to the public sector. When people see it, they will see that it is fair to the public sector—people in the public sector will get a much more generous pension than is available in almost any part of the private sector—but it is also fair to the taxpayers. It is, of course, based on the work of John Hutton, a former Labour Pensions Secretary.
Jake Berry (Rossendale and Darwen) (Con)
T3. Labour-controlled Blackburn with Darwen council has abandoned pensioners and schoolchildren in my constituency because of a £10,000 bus cut, but it can still find £94,500 to fund trade union officials. Does my right hon. Friend think it is right that the taxpayer picks up the tab for trade union officials?
Mr Osborne
In central Government we have announced that we are reducing the facility time, as it is called, in the civil service because we do not think it is fair that taxpayers should be paying for so many full-time trade union officials. Obviously, it is up to Blackburn with Darwen council to decide how it spends its council tax payers’ money, but from what my hon. Friend is telling me, it does not look as if the council is spending it particularly well.
Ed Balls (Morley and Outwood) (Lab/Co-op)
Today’s figures have shown that the British economy has grown over the past 12 months, since the Chancellor’s spending review, by just 0.5%, and Treasury officials have apparently admitted to the BBC this afternoon that the economy is now set to worsen. The IMF says that if the British economy continues to undershoot, the Chancellor should change course to boost growth and jobs. How much longer does the country have to wait before the Chancellor will finally listen?
Mr Osborne
I welcome the right hon. Gentleman back from America. We missed him in our debates last week—even though, by some coincidence, the tone of the debate markedly improved. We have been keeping an eye on what he was saying while he was in America. This is what he told American television: “What the world needs are balanced plans on deficit reduction, and you can’t duck that.” In America he has to say that so that he is not laughed out of the TV studio. Here he not only ducks deficit reduction; he runs away from it. We are clearing up the mess that he left when he was running Britain’s economic policy for 13 years.
Ed Balls
I am afraid people watching this will think that was a deeply complacent answer. Today’s figures mean that the Chancellor’s figures for growth will be downgraded. They will undershoot the OECD and the IMF growth forecast as well. He tried to blame the eurozone, but the fact is that our recovery was choked off a year ago. Families watching this programme and struggling with their bills, businesses on the edge and young people losing their jobs will all think the Chancellor is completely out of touch. Why does he not understand that if we are to get the deficit down, the country needs a plan for growth and jobs, and it needs it now? How much longer will we have to put up with this prevarication before it is too late, and the Chancellor finally acts?
Mr Osborne
The GDP numbers showed this morning that the British economy is growing, and that is positive news. But of course we have a difficult journey to take, from the deepest recession of our lifetimes and the biggest banking crisis in British history, which the right hon. Gentleman presided over when the Labour party was in government—and it is made more difficult by what is happening elsewhere in the world. [Interruption.] Of course that is the case, which is why the growth figures in the British economy are similar to the growth figures in the American economy, or the French economy, or the German economy.
Mr Osborne
The right hon. Gentleman shakes his head, but in 2011 the British economy has grown at exactly the same rate as the United States economy. It has taken a completely different course from the one that he suggested as shadow Chancellor and yet it has the same growth, which shows that what we are doing is bringing stability to the British economy. Frankly, for him to get up every week and say that we need a deficit reduction plan, but not to give us any details, shows how hopelessly out of touch he is.
Dr Julian Lewis (New Forest East) (Con)
T4. If the Greeks can have a referendum on Europe, why can’t we?
Mr Osborne
What the Greek Prime Minister has apparently offered the Greek people is a referendum on difficult decisions required to get the budget deficit down. That is what he is talking about. We talked about these things in advance of a general election. Two parties here talked about those difficult decisions. We got elected, we are in government and we are now doing it, and we are recovering from the deep mess that the Labour party left us in.
Mr David Crausby (Bolton North East) (Lab)
T2. Will the Chancellor intervene to prevent directors’ pay from increasing by another 49% this year? Or if he is not willing to intervene, will he at least explain to those suffering cuts in pay and the loss of their jobs, just how we are all in this together?
Mr Osborne
I have made it very clear, and the Prime Minister has made it very clear, that at all levels of society people have to be mindful of the current economic situation, and that includes highly paid directors and people working for the financial services. Bonuses are significantly lower than they were under the Government whom the hon. Gentleman supported, and we are also introducing measures to encourage transparency in pay, and to give shareholders greater control over executive pay as well.
Mr Douglas Carswell (Clacton) (Con)
T5. Is my right hon. Friend aware of the TaxPayers Alliance’s excellent report published last week on abolishing national insurance and merging national insurance with income tax? Does he believe that the merger of national insurance and income tax would be a good way to simplify tax in the way that he promised, and will he make it happen?
The Exchequer Secretary to the Treasury (Mr David Gauke)
My hon. Friend will be aware that the Government are looking into merging the operation of national insurance contributions and income tax. We are actively looking at ways in which we can make the tax system more transparent and simpler to understand, and we will be saying more on that subject shortly.
Luciana Berger (Liverpool, Wavertree) (Lab/Co-op)
T8. What does the Chancellor say to the Federation of Small Businesses, which describes his policies as too timid, and out of touch with the sluggishness of the UK’s economy?
Mr Osborne
The FSB, like many other business organisations, has supported what we have done to try to get the deficit down—and of course it also welcomes the fact that not only did we reverse the increase that the Labour Government planned in the small companies rate, but we have also been able to reduce the small companies rate and freeze business rates for another year.
Stephen Lloyd (Eastbourne) (LD)
T6. Does the Minister agree that new plans for the Government to lend directly to small businesses and start-ups through credit easing will be beneficial to the economy and will create more jobs? Will the Minister also give me examples of how that will be put into practice?
The Chief Secretary to the Treasury (Danny Alexander)
I do agree with my hon. Friend. We will set out more details of our credit easing plan in the autumn statement later this month, but it is a mark of the Government that we are prepared to think differently and intelligently about how we can use such mechanisms precisely to get small businesses going in this country.
Andrew Gwynne (Denton and Reddish) (Lab)
T9. Youth unemployment now stands at a shocking 34% in Tameside and 23% in Stockport. Is not the right thing to do to listen to Labour’s five-point jobs plan, get the bank bonus tax reinstated and invest in 100,000 jobs for young people?
Mr Osborne
In his pitch for a job, the hon. Gentleman failed to mention that youth unemployment rose by more than 40% under the Labour Government. There is complete amnesia about the fact that 16 months ago they left this country with high unemployment, a high budget deficit, the deepest recession this country has seen in the last 100 years, and the biggest banking crisis in our history.
Alun Cairns (Vale of Glamorgan) (Con)
T7. Some of the most needy children in the Vale of Glamorgan and across the UK will benefit from today onwards from the Government’s junior ISA. That presents an opportunity to return to a culture of savings among families. What plans have the Government to develop that further?
Mr Osborne
We have indeed announced today the launch of the junior ISA, which will enable many millions of parents to save for their children up to £3,600 a year tax free. It should help more than 6 million children who will be eligible for it immediately and many more as they are born and grow up. It is all about trying to foster a savings culture after the age of irresponsibility and the culture of debt that we saw over the past decade.
Stephen Pound (Ealing North) (Lab)
T10. I can assure the Chancellor of the Exchequer that I am not looking for a job—unlike many of my constituents. He talked earlier about fiscal integration. Does he agree that the possibility of a differential rate of corporation tax within the United Kingdom contains severe dangers?
Mr Osborne
As the hon. Gentleman well knows, we are consulting on the possibility of introducing a different corporation tax rate in Northern Ireland, reflecting the fact that the Irish Republic has a much lower corporation tax rate. The consultation is ongoing, and we are of course in discussions with the Northern Ireland Executive. We are clear that Northern Ireland would have to bear the cost of that in forgone revenues, and an important part of the discussions will be working out what exactly those forgone revenues would be.
Jo Swinson (East Dunbartonshire) (LD)
I am concerned by reports that the Government are considering breaking with the 20-year convention of uprating pensions and benefits by the September inflation figure, now that the CPI has come in at 5.2%. Does the Chancellor recognise that it would be unfair to change the rules of the game suddenly, hurting vulnerable pensioners and disabled people in the process?
Mr Osborne
We are absolutely committed to the triple lock that we introduced on pensions so that they rise by CPI, earnings or 2.5%, whichever is greater. That is one of the really significant achievements of this Government, which two parties came together to create, and I think that it is something we can be very proud of.
Mr David Winnick (Walsall North) (Lab)
May I tell the Chancellor that what is happening in the economy reminds me very much of the havoc and destruction caused by the Thatcher Government in the 1980s, with mass unemployment and poverty? Is it not perfectly understandable why many people are protesting against the sheer injustice, including those who are protesting, and rightly so, outside St Paul’s?
Mr Osborne
Again, there is absolutely no recognition that the Government the hon. Gentleman supported presided over the second deepest recession in the entire world. What is the Opposition’s explanation for that? Why was Britain so badly affected? Why was the British economy so unbalanced? Why had the gap between the rich and the poor grown? Why had manufacturing halved as a share of GDP? They have absolutely no answers on Labour’s record in office.
Mark Menzies (Fylde) (Con)
Will the Chancellor, or the Economic Secretary to the Treasury, expand on the advantages that the Warton local enterprise zone in my constituency will bring to businesses, particularly from tax breaks and improved planning rules?
Mr Osborne
I am very pleased that we were able to announce that additional enterprise zone for my hon. Friend’s constituents, which reflects the fact that the cut in the US defence budget had an impact on BAE Systems. I am glad that we were able to move quickly to create an enterprise zone, not only in the north-west but in east Yorkshire, to take into account the impact of that decision.
Mr Andrew Love (Edmonton) (Lab/Co-op)
If the Government’s overriding priority is to eliminate the deficit by the end of this Parliament, why is the Chancellor having to borrow an additional £46 billion during that period?
Mr Osborne
We inherited the highest—[Interruption.] The Opposition do not want to hear this. We inherited the highest budget deficit in Britain’s peacetime history. That budget deficit is now coming down, and that has contributed to financial stability in this country, in marked contrast with what we see on our television screens around Europe.
Mr William Cash (Stone) (Con)
Will my right hon. Friend pass on the message to the Deputy Prime Minister, with his accusations that Conservatives who advocate repatriation and renegotiation are committing economic suicide, that we are facing not only a disastrous two-tier Europe, but now also a two-tier Government?
Mr Osborne
Of course I do not agree with my hon. Friend on this occasion. The coalition Government have been able to get Britain out of the European Union bail-out that we found ourselves in when we came to office. We have been able to keep the budget increases down—again, in marked contrast with what we found on coming into office. We must now have some serious negotiations to make sure that Britain’s interests are protected in Europe, as the remorseless logic of monetary union—I am sure that he accepts this—leads to greater fiscal integration among eurozone countries. That is the reality of the situation facing us, and I think Britain under this Government will be able to negotiate well in our national interest.
Steve McCabe (Birmingham, Selly Oak) (Lab)
If the Chancellor cannot bring himself to extend the national insurance holiday to small and micro-businesses because the shadow Chancellor suggested it, will that be easier now that the CBI is also recommending it?
Mr Osborne
The CBI has been absolutely staunch in its defence of our deficit reduction plan, and says that it is crucial for business confidence. If the shadow Chancellor wants to make proposals to increase spending and borrowing, which he is perfectly entitled to do, why does he not also make proposals to cut Government spending and to get the budget deficit down? He talks about providing a medium-term deficit reduction plan, but we have not heard one single line item of it.
Stephen Williams (Bristol West) (LD)
Whatever one thinks of the tactics of those who are camping outside St Paul’s and in the middle of my constituency, one issue that they are raising that resonates with the British public is the feeling that people are not paying their fair share of tax. Will my right hon. Friend update us on what progress we are making across the House, particularly on lifetime loans—disguised remuneration?
Mr Osborne
My hon. Friend raises a good point. At a time like this, people want to make sure that everyone pays their fair share of tax. We have taken action on the situation in Switzerland and on long-stay non-doms, but he raises a third point about disguised remuneration. That is a way in which people, often in financial services, get away with a much lower rate of tax. Guess who in the House voted against that action? The Labour party.
Mr Speaker
Order. As usual, this event is heavily oversubscribed. I am sorry to disappoint colleagues, but we must now move on.
Gangs and Youth Violence
(12 years, 6 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Secretary of State for the Home Department (Mrs Theresa May)
With permission, Mr Speaker, I would like to make a statement on the cross-Government report into ending gang and youth violence. Following the shocking scenes of disorder over the summer, the Prime Minister asked me to lead a review, alongside my right hon. Friend the Secretary of State for Work and Pensions, of gangs and youth violence. Today’s report is not the end of that process. It is merely the start of a comprehensive, long-term programme of work to tackle the violence that blights too many of our towns and cities.
We have visited front-line projects; we have analysed youth violence and street gangs; we have met local authority chief executives, senior police officers, voluntary organisations and former gang members; and we have hosted an international conference of experts. Using this research, we have identified what can be done by Government and other agencies to stop the violence and to turn around the lives of those involved. Today’s report is an important first analysis of the problem, and of the interventions that work. It provides a platform for the intensive support we will provide to the most affected areas.
If we are honest with ourselves, we need to accept that not enough was done over the years to deal with a problem we all knew existed and we knew was not being addressed. But the riots brought home to the whole country how serious a problem gang and youth violence has become. The statistics show that one in five of those arrested in connection with the riots in London were known gang members. Similar figures were recorded by West Yorkshire police, and Nottinghamshire had only a slightly lower proportion. Most other police forces identified fewer than 10% of all those arrested as known gang members, so gangs were not the sole cause of the riots, but they were a factor. The fact that so many young people who are not involved in gangs were still willing to carry out such serious acts of criminality merely reinforces the urgent need for action.
Gang members and young people engaged in violence do not appear out of the blue. Analysis of their life stories shows certain common factors: parental neglect early in life, often linked to drug addiction or alcohol abuse and violence in the home; a history of poor discipline at school, truancy and exclusion; early brushes with the law for more minor offences; and exposure to older gang members, often based around their local estate. Those factors come up time and again, and during the review we heard powerful real-life examples. Our analysis also showed that gang membership itself can be an important driver of criminality and violence. In London, for example, almost 50% of shootings and 22% of serious violence are committed by known gang members.
Our considered and evidence-based approach is designed to deal with each and every aspect of gang culture and youth violence. It will be based on five areas: prevention, pathways out, punishment, partnership working and providing support.
Preventing young people from becoming involved in gangs and youth violence means starting at the beginning. Research shows that early intervention is the most cost-effective way of reducing violence later in life, so we are recruiting 4,200 extra health visitors and doubling the capacity of family nurse partnership schemes, to help 13,000 young mothers. We are providing £18 million to identify and support domestic violence victims and their children, who are at particular risk of turning to violence in adulthood.
In schools, the pathway for young people into crime is all too clear: from low-level absence, to persistent absence and truancy, to low literacy and poor attainment. That is why our education reforms are focused on: early intervention in the foundation years; taking a rigorous approach to eliminating illiteracy; improving behaviour and discipline; and ensuring that every young person is taught in a way that inspires them and prepares them for the world of work.
If prevention fails and young people are drawn into gangs and youth violence, we need to ensure that we provide viable pathways out. Moments of crisis in a young person’s life, such as arrest, exclusion from school or attending an accident and emergency department offer vital opportunities to intervene, so we will work with A and E departments and children’s social care providers to help young people who may be affected by gang violence.
For those who are arrested, we will expand schemes to help young offenders with mental health and substance misuse problems, and we will look to provide ways out of gangs for those who have been convicted and served their time. We will therefore improve education provision in young offenders institutions and ensure that all young people who leave prison and claim jobseeker’s allowance are referred immediately to the Work programme.
We will also establish a new ending gangs and youth violence team of community activists, NHS experts and police officers. It will offer intensive support to gang-affected areas to help them understand their problem and develop their own solutions, which could include rolling out schemes to re-house gang members who want to exit the gang lifestyle and mediation schemes to prevent retaliatory violence.
Our review found some excellent police work to identify and manage the highest-risk gang members through a combination of targeted surveillance, enforcement and arrest for any offence, however minor, and positive offers of training, employment and drugs treatment for those who want a different life. However, those not prepared to break away from violence will face harsher and tougher punishments. That is why we will consult on making a new offence of possession of an illegal firearm with intent to supply, and on whether the penalty for illegal firearm importation should be increased. We are also consulting on whether the police need additional curfew powers. It is why we are extending the new gang injunctions to 14 to 17-year-olds, for example, to stop gang members entering rival territory, prevent them from being in public with dangerous dogs and require them to undertake positive activities; and it is why we are strengthening our laws on weapons possession so that anyone, including offenders aged 16 or 17, convicted of using a knife to threaten and endanger others will now face a mandatory custodial sentence. Any adult who commits a second very serious violent or sexual crime will now face a mandatory life sentence.
This is not, however, solely a police and criminal justice programme. All the agencies that young people deal with, from teachers to health service workers and social services, need to develop better systems for identifying high-risk individuals, sharing information and working together. Simply throwing more money at the problem is not the answer. We need a more intelligent approach.
We know, for example, that there are families on whom multiple Government agencies spend hundreds of thousands of pounds each year, yet their problems persist. That is why Louise Casey is today starting her work as the head of a new troubled families team to drive forward our commitment to turn around the lives of 120,000 troubled families. We will also deliver our commitment that all hospital A and E departments should share anonymised data on violent assaults with the police and other agencies. Sharing information and taking a multi-agency approach might not sound very exciting, but they work.
Finally, to support local areas, we will target Home Office funds on those places where the most serious gang and youth violence problems exist. We will therefore provide £10 million in funding next year to support up to 30 local areas and invest at least £1.2 million of new resources over the next three years to improve services for young victims of sexual violence in our major urban areas, with a new focus on the girls and young women caught up in gang-related rape and abuse.
For too long, communities have lived in fear of gangs. Many young lives have been ruined; many young lives have been lost. The summer showed that it is time for society to take a stand. It is time for a long-term programme, with intervention at each stage of vulnerable people’s lives; it is time for a locally led approach, with agencies working together and sharing information; and it is time for tough enforcement to be backed up by work to address the root causes of gang and youth violence. That is what our programme will deliver and I commend this statement to the House.
Yvette Cooper (Normanton, Pontefract and Castleford) (Lab)
I thank the Home Secretary for early sight of her statement and the Government report.
The Opposition agree with the Government’s aim of tackling gang culture. The Home Secretary is right to point to the devastating impact on the victims of gang violence and intimidation and to be concerned about the damage that gangs do to those who get sucked into them, sometimes even in the search for protection. The violence is horrifying; the long-term scars for young people and society are severe. She is right that gangs played a part in the riots, but also that they have played a part in problems such as knife crime that affect some of our major cities.
The Home Secretary also recognises that the overwhelming majority of young people do not get involved in gangs. Indeed, youth crime fell over the course of the previous Parliament as fewer young people were drawn into criminal activity, but we want youth crime to fall further, not to go back up. That is why action on the pernicious effect of gang culture is so important.
I therefore agree strongly with the Home Secretary that effective action requires prevention, early intervention, working in partnerships, tough action and crackdowns on persistent gang activity, and punishment. Effective action needs to involve the NHS, schools and councils as well as the police. We also need action on domestic violence and to consider the impact on women and girls. She should also consider increasing the focus on housing and on the victims of gangs.
I welcome the Home Secretary’s work to build on Labour’s approach in government, including the family intervention projects and implementing the extension of gang injunctions to 14-year-olds, for which the previous Labour Government legislated before the last election.
I agree with the Home Secretary that we need to go further. I, too, am impressed by some of the work that police and local councils are doing in some areas to target gang members by offering them a way out, but rightly getting tough on them if they will not take it, but I am deeply concerned that the reality of the Government’s policy does not live up to the rhetoric. For a start, there is still complete confusion about sentencing policies. Last week, the Home Office told the papers that there would be longer sentences for gang members; yesterday, the Home Secretary told them that there would not be. Her plans on powers are also confused. She will know that many police forces and councils find that ASBOs are one of the most useful tools in disrupting gang activity, yet her policy still is to abolish them and replace them with weaker injunctions, so she is making it harder and not easier for the police to crack down.
We welcome the emphasis on early intervention in the report, but that sits badly with the 20% cuts to Sure Start and well over 20% cuts to the youth service. We welcome the learning of lessons from successful work in places such as Strathclyde, but here is the real problem: the work in Strathclyde alone required an additional £5 million, but she has announced only £10 million for the country as a whole, and the Home Office has already said that that funding is not new. At the same time, she is halving the local community safety budgets, which councils and the police use for gang prevention work right now—£44 million of cuts over the next two years alone, on top of the cuts to community safety funding in the emergency Budget.
Before the election, Haringey, where the riots started, received £2.2 million for community safety, including the action it was taking, with the police, to target gangs. By next year, that figure will be £200,000—a 90% cut in one borough alone. In Liverpool, the youth offending service, which works with gangs and young offenders, is facing more than £2 million of cuts—an overall reduction in its budget of 34%. All that comes on top of 16,000 police officer cuts, nearly 6,000 of which are in the forces that face the biggest problems with gangs.
The Government are cutting too far, too fast, hitting not only the criminal justice system, but our economy, which risks costing us more. Higher unemployment and higher crime will cost us more. Ministers are right to be concerned about gangs and youth crime and to want action, but what does this really add up to on the streets of Lambeth or Liverpool or for the young people of Birmingham or Brent? Given that the Government are pushing up youth unemployment to nearly 1 million, cutting 16,000 police officers, ending ASBOs, slashing youth services and cutting crime prevention, can the Home Secretary put her hand on her heart and tell the House that during this Parliament the youth crime rate will fall, as it did in previous Parliaments?
We agree with much of what the Home Secretary said today, but when we look at the reality behind the rhetoric—the reality behind her words—we see the truth, which is that the Government are still making it harder, not easier, for the police and communities to tackle gang violence and cut crime.
Mrs May
We have heard a typical response from the right hon. Lady. I shall start with the statements where she agreed with what we were doing, with the need to do more to draw young people out of gangs and reduce youth violence and with the point that this is not just about the police, but about how the NHS, schools and a variety of other agencies need to be involved. As I said in my statement, that is the basis of this first truly cross-Government report. She mentioned good projects by the police. There are a number of very good projects out there in parts of the Metropolitan police, Greater Manchester, the west midlands, Merseyside and, of course, Strathclyde. Those projects are already starting to make a difference.
Sadly, however, having said that she agreed with a lot of what I said, the right hon. Lady then, as she did in August when we were talking about the riots, chose to be party political. I am sorry that she chose to do that, but I shall address her various points. She said that we should not scrap ASBOs, but what good have ASBOs done, given that, as she said, gang culture has been getting worse? We are getting rid of ASBOs and replacing them with measures that will actually deliver for local communities, deter antisocial behaviour and put communities back in charge. She mentioned funding for Sure Start. That funding is provided through the early intervention grant, but, crucially, we are ensuring that Sure Start is focused on the very families it was set up to help in the first place—the very families that most need our help and support.
The right hon. Lady talked about police cuts. She never misses a chance to demonstrate her fiscal irresponsibility, and I knew that today would not be any different. She attacked cuts in police spending, but she did not say that it was the stated policy of her party to cut police spending. On her comments about police numbers, let me tell the House what she said about gangs and police numbers in August:
“Boots on the streets are not enough to sustain safe communities”.—[Official Report, 11 August 2011; Vol. 531, c. 1151.]
I wonder why she has changed her mind.
The right hon. Lady also talked about other spending cuts. Let me tell her what Jacqui Smith, the former Labour Home Secretary, said just this morning:
“You need to be much better at measuring the impact of the money we spend as well as simply spending it.”
I suggest that the right hon. Lady take a lesson from her. The shadow Home Secretary seems to think that gang problems have been caused by this Government and did not exist under the previous Government, but let me remind her what she said in August:
“I agree that more needs to be done about gang culture, which has been getting worse.”—[Official Report, 11 August 2011; Vol. 531, c. 1151.]
Yes: getting worse under the Labour Government. Just this morning, Jacqui Smith said that Labour “hadn’t done well enough” in tackling gang violence”. She has been straight about her record; it is a shame that the shadow Home Secretary cannot bring herself to be straight too.
Robert Halfon (Harlow) (Con)
I very much welcome my right hon. Friend’s statement. Does she agree that the best way of getting young people off the conveyor belt to crime is to target early years and ensure that young people have access to education and community projects such as the Prince’s Trust and the college in my constituency, and organisations such as Catch22? Given that the previous Home Secretary has said that in the past money was not always spent as it should have been, does my right hon. Friend agree that spending money on projects such as those that I have described is the right way forward?
Mrs May
My hon. Friend is absolutely right that early years intervention is key, and it is part of the work to prevent young people from getting involved in gangs in the first place. Early intervention might be needed at a very early age indeed, with toddlers, to ensure that they do not go down that road. That is why it is so important to ensure that money is spent in the right way, on projects that will make a difference and really work.
Keith Vaz (Leicester East) (Lab)
I welcome the Home Secretary’s proposals and the appointment of Louise Casey to head the new unit. The right hon. Lady will have noted the evidence of Bill Bratton, one of the guests at her international conference and round table, who said:
“You can’t arrest your way out”
of gang problems. Early intervention has been a theme of the right hon. Member for Chingford and Woodford Green (Mr Duncan Smith) and my hon. Friend the Member for Nottingham North (Mr Allen) for a number of years. What worries me is who will co-ordinate the various initiatives. A number of Departments are involved and monitoring will be crucial, so will it be her, as Home Secretary, or another Department?
Mrs May
I thank the right hon. Gentleman. I pay tribute to Louise Casey for the work that I know she will do and to my right hon. Friend the Secretary of State for Communities and Local Government, who has appointed her to the troubled families unit, as part of his Department’s work. Let me also record our thanks to Bill Bratton, whom the right hon. Gentleman mentioned. He came over and visited a number of projects in the UK, participating in our round table and international forum on gang and youth violence. Crucially, he also gave hope from the projects that he had seen that it is possible for the UK to turn the problem around. The right hon. Gentleman is right to focus on monitoring, and, as I said, this is the start of the process. The inter-ministerial group that I chaired alongside my right hon. Friend the Secretary of State for Work and Pensions will continue and will oversee the work currently being undertaken.
Nick de Bois (Enfield North) (Con)
The Home Secretary will be aware of the problems with gangs and knife crime that my constituency faces. My constituents will warmly welcome her announcement, but does she envisage a role for volunteer organisations, which already do a lot of work, in delivering the strategy on the front line?
Mrs May
Yes, I can absolutely reassure my hon. Friend that I see a significant role for voluntary organisations. The Secretary of State for Work and Pensions and I attended a round table set up by the Centre for Social Justice, at which we met people from a number of voluntary groups, including some ex-gang members who are doing excellent work. Indeed, it is often voluntary groups that can make a difference to young people involved in gang membership, or to those about to get involved, and that can turn them around.
Hazel Blears (Salford and Eccles) (Lab)
The Home Secretary might be interested to know that at 5 o’clock this morning 24 people across Salford and Manchester were arrested in connection with incidents during the disturbances in the summer. Much of the evidence was gathered using CCTV and DNA, a message that I am sure the right hon. Lady will take away. The family intervention projects will be essential to ensuring that our young people do not follow that path. Will she assure me that some funds from the Home Office and the family intervention projects will be targeted on Salford, to ensure that we keep our young people away from these problems in future?
Mrs May
I was aware of the work being done by Greater Manchester police, who have been doing excellent work following the riots, as have a number of other forces across the country. It is absolutely the case that, among the variety of amounts of money that are going to be made available for various aspects of this scheme, some will be focused on the Greater Manchester area. We will identify 30 areas for which £10 million from the Home Office will be available next year, and we are working with the Association of Chief Police Officers, which is mapping the gangs at the moment, to identify those areas. We have already identified Greater Manchester as one of the three areas—alongside the west midlands and London—into which specific Home Office funding is going in for the guns, gangs and knives project.
Tom Brake (Carshalton and Wallington) (LD)
I welcome the analysis that underlines the fact that parental neglect, violence at home, truancy and exclusion are factors that can lead to gang membership. I also welcome the five areas on which the Government are focusing, especially pathways out. On that point, what support can the Government provide for suitable role models and mentors who can steer young people away from gangs and towards a more positive future?
Mrs May
My right hon. Friend makes an interesting point. One aspect of the way in which we intend to operate involves ensuring that people are able to identify at local level what will work in their area. In looking at various projects, I have seen that the people who are the most effective in persuading others to leave gangs are often former gang members. They have been through it, they know that a different life is possible, and they can give others the benefit of their personal experience. I have seen that happening in a number of areas, and I believe that a number of local areas will want to follow up on that aspect.
Glenda Jackson (Hampstead and Kilburn) (Lab)
My constituency is served by two boroughs: Brent and Camden. In both, the funding for the safer communities and youth offending teams has been slashed. In Brent, it has been slashed by almost 18%, and in Camden by more than 27%. I agree with the Home Secretary that we can tackle gangs only through a multi-agency approach, but every other agency to which she referred in her statement is suffering from similar cuts, so how can that intensive support to which she referred be delivered?
Mrs May
One of the points that the hon. Lady is missing is that, sadly, over the years, significant sums have been spent on projects that are not as effective as they should be. There are families out there on whom hundreds of thousands of pounds are being spent by various Government agencies, often not working together, and this is not effective. The problems still persist. The work that has been done in Waltham Forest, however, shows that if we bring together agencies such as the police, the local authority and others to tackle gang violence, yes, we spend money on those individuals, but we end up saving money by turning their lives around. Often, the effective intervention is not the expensive intervention.
Paul Maynard (Blackpool North and Cleveleys) (Con)
I welcome the Home Secretary’s statement, but a short prison sentence of two months for youths convicted of knife crime does not offer the opportunity for complete rehabilitation. Does she agree, however, that it might offer a vital opportunity to diagnose previously hidden conditions such as communication delay, which could be a key factor in people entering pathways to crime?
Mrs May
I commend my hon. Friend’s work on this issue. I know that he takes it very seriously, and that he has looked into the impact of communication delay on young people. In relation to sentencing, it is important to send a clear message about the importance that we attach to doing something to reduce and stop knife crime. We also need to look at the interventions that take place when young people are undertaking custodial sentences, to ensure that we can rehabilitate them and take the opportunity to turn their lives around.
Sir Gerald Kaufman (Manchester, Gorton) (Lab)
Youth unemployment in my constituency is higher than it has ever been, and this is directly caused by Government cuts—[Interruption.] It is directly caused by Government cuts. Educational opportunities have been blighted by the abolition of education maintenance allowance, and a youth club in my constituency is in jeopardy because of Government cuts. What option is the Home Secretary going to provide for young people in my constituency apart from the streets? Will she provide direct funding for organisations such as Reclaim and Trinity House in my constituency, which combat the effects that this Government have created?
Mrs May
As I have said, specific funding will be available, which will be targeted at projects in those areas of the highest violence and those areas with the most significant problems. We are working with the Association of Chief Police Officers to identify those areas. I also say to the right hon. Gentleman that he really should not try to rewrite history: youth unemployment was going up for six years under the last Labour Government.
Paul Uppal (Wolverhampton South West) (Con)
To view this issue from a purely financial perspective is prosaic. From my experience, one reason why many young people join gangs is that they are seeking a surrogate or substitute family. This is particularly the case among young men who are often looking for a positive male role model. I welcome my right hon. Friend’s initial response on role models. Will she elaborate on how positive male role models could play a role in this issue?
Mrs May
My hon. Friend has identified a very important issue. As I said earlier, it is absolutely the case that, sadly, all the Opposition only ever want to talk about is the amount of money being spent rather than about how it is being spent and how we can act intelligently to make a real difference. Ensuring that there are positive role models—particularly male role models—available to young people in these gangs is an important part of that. My hon. Friend is also right that, sadly, for too many young people involved in these gangs, the gang effectively substitutes for a family. When I met a former gang member, I was struck when he told me that when he was out in the streets with the gang, his mother was lying at home dead-drunk.
Dr William McCrea (South Antrim) (DUP)
The Home Secretary states that agencies must work together to focus on the early intervention in the foundation years. What responsibility does she feel the family has in that area of intervention and how do we harness family and parental responsibility?
Mrs May
The hon. Gentleman has made an important point. In helping a young person either to come out of gang membership or to prevent him from getting involved in the first place, it is often important to look not just at that individual but at the whole family. As I indicated in my answer to my hon. Friend the Member for Wolverhampton South West (Paul Uppal), the problems sometimes lie in the family, and it is that family background that is a significant cause of what is happening to the young person. Work that is being done—for example, early intervention work by health visitors, family nurse partnerships and so forth—is important in providing essential support within a family.
Mr Mark Spencer (Sherwood) (Con)
I wonder whether the Home Secretary would recognise that there is a significant role for local authorities and housing associations in taking firm action against families that commit criminal activity or antisocial behaviour. Moving those families on by evicting them not only gives the community around them a respite but gives the family a chance for a fresh start somewhere else.
Mrs May
That is absolutely right. In fact, moving families on can help in two ways. One is where the family are creating particular problems on an estate or in an area, and the housing association or local council can take action that can relieve the rest of the community. Another is in circumstances where in order to get a potential gang member away from the area in which the gang is involved it is necessary to move that gang member and the family. There can be a positive move as well as a negative one, so to speak.
Jeremy Corbyn (Islington North) (Lab)
Everybody abhors gang violence and the cultures that go with it, but does the Home Secretary recognise that some young people are attracted by a perverse sense of glamour towards gangs as an escape from overcrowded housing or as an escape from the lack of job opportunities or youth facilities? Because they cannot develop themselves in those ways, they see a gang as something worth looking at. Should we not instead invest in jobs, housing and communities as much as in all the other palliative measures that the Home Secretary has suggested?
Mrs May
A great many young people live in difficult circumstances but do not turn to gangs. Of course it is important for us to look at gang membership and youth violence in the round rather than arresting our way out of the problem, because it is not possible for us to arrest our way out of it. As I said earlier, young people coming out of prison who claim jobseeker’s allowance will go straight on to the Work programme. We must make a real effort to deal with problems such as unemployment, and to help those young people to find a different route through life.
Patrick Mercer (Newark) (Con)
I am sure that the Home Secretary was as impressed as I was by the work of Nottinghamshire constabulary, many of whose central Nottingham stations came under sustained and potentially lethal attack by petrol bombers during August. I accept that prevention is better than cure, and I note the Home Secretary’s strictures about knives and firearms, but what is being done, and what will she do, about the carrying and preparation of petrol bombs?
Mrs May
My hon. Friend has raised an important issue. We have not addressed it in the review, but I shall be happy to consider it. I pay tribute to the work done by Nottinghamshire police in defending both people and premises. As he says, they came under significant and sustained attack during what was a very difficult time.
Fiona Mactaggart (Slough) (Lab)
It is the judgment of Slough’s local police commander, Richard Humphrey, that the reason there was not more serious violence in the town that I represent, despite the risks posed by such factors as gang membership, was the contribution of Aik Saath and other youth organisations. What help is the Home Secretary offering youth organisations that can prevent problems of this kind?
Mr Rob Wilson (Reading East) (Con)
I welcomed the statement, although I am not sure whether it was necessary for all five of the areas that my right hon. Friend mentioned to begin with a P. As she knows, many gangs carry knives. What preventive measures are being taken to prevent young people from carrying knives in the first place?
Mrs May
The Home Office was very pleased when Brooke Kinsella did an important piece of work for us last year, which resulted in a report that was published earlier this year. It concerned projects around the country that involve working with young people to deter them from carrying knives. The Ben Kinsella fund, which is being administered through the Prince’s Trust, has received funds from the Home Office to support such projects. Meanwhile, the Department for Education will be considering what materials can be made available to schools to help them get the message across to young people about the problems and dangers of knives.
Pete Wishart (Perth and North Perthshire) (SNP)
Has the Home Secretary taken a good, close look at the efforts of Strathclyde police to tackle gang violence? Does she believe that they have been successful? Unlike her Government, the Government of the Scottish National party have increased the number of police on the streets of Scotland by 1,000. Will she also take a look at today’s proposal by the Scottish Government to introduce minimum alcohol prices, which will deal with the alcohol problems that fuel so much youth violence?
Mrs May
I am aware of the alcohol-related problems in Scotland that have led the Scottish Government to introduce their minimum pricing policy. I have spoken to Strathclyde police, and my right hon. Friend the Secretary of State for Work and Pensions has also done so on a number of occasions. When representatives including Karyn McCluskey made a presentation to our inter-ministerial group, they made it very clear that although effective policing was necessary, it was not just a question of policing, but also a question of working with others. When I was in the area I was able to talk to some former gang members, and also to a gang member who is trying to leave the gang. They too made it clear that while policing is part of the process, it is not the only element. Working with other agencies is what really makes the difference.
Gareth Johnson (Dartford) (Con)
Does the Home Secretary agree that tackling gang behaviour in prisons is vital if we are to tackle such behaviour, including violence, when those people are eventually released on to the streets?
Mrs May
Yes, and one of the things we will be doing is looking at the support that is available for young people in young offenders institutions. The Metropolitan police are already doing work at Feltham to ensure both that there is no gang violence in the institution and that gang members are helped and given the support they need to leave the gangs.
John Cryer (Leyton and Wanstead) (Lab)
I was pleased to hear the Home Secretary mention the London borough of Waltham Forest. It has a pioneering anti-gang strategy that has used resources properly, as I am sure will be confirmed by the right hon. Member for Chingford and Woodford Green (Mr Duncan Smith). However—the right hon. Lady can probably guess what’s coming next—many of the budgets that feed into that strategy are facing the squeeze. The Home Secretary talks about resources that she hopes will be available in the future, but we must have access to them fairly quickly. How might that be done in the near future?
Mrs May
Sources of funding are available, such as the innovation fund, for which authorities can bid, and which will have a specific role in making funding available for gang-related projects. The chief executive of Waltham Forest and local Metropolitan police representatives came to speak to the inter-ministerial group, and they made the point that the amount of money they were spending effectively on families was often lower than the amount that Government collectively might have been spending on them in the past. There is therefore a significant reduction in the amount of money that needs to be spent to deal with this issue.
Richard Graham (Gloucester) (Con)
The Home Secretary is right to highlight the benefits of partnership-working. Last week, I visited the newly formed Quedgeley youth centre, which replaces the local authority’s former Echoes youth club. It has been created by an innovative partnership led by local Conservative councillors and financed by Prospect Training Services, other businesses and the Quedgeley Community Trust. Early indications are that the new youth centre is proving even more popular with the young, and that it will be very successful. Will my right hon. Friend join me in congratulating all those involved in this local initiative, which shows the benefit of partnership-working, at zero cost to the taxpayer?
Mrs May
I am very happy to welcome the opening of the Quedgeley centre, and I am sure from what my hon. Friend has said that it will do excellent work locally in helping young people and providing the support they need. He also makes the valid and interesting point that dealing with these issues is not all about Government spending money—sadly, a message that Opposition Members seem to have failed to understand.
Clive Efford (Eltham) (Lab)
The Government have cut 60% from community safety budgets, including £10 million from London alone. Will the right hon. Lady clarify the position in respect of the £10 million she has announced today? Is it the same £10 million she announced back in February for early intervention? If it is, will she undertake to write to Members to explain what has been cut today as a result of her announcement?
Mrs May
I can confirm that we were making a further £10 million available next year for the early intervention fund. We will be ensuring that that money is specifically spent on projects related to gang and youth violence projects. [Hon. Members: “Ah.”] Well, Opposition Members say “Ah,” but—[Interruption.] I have never been able to imitate the hon. Member for Rhondda (Chris Bryant), so I shall not attempt to do so. I simply make the point I made earlier to my hon. Friend the Member for Bedford (Richard Fuller): we are talking about a new approach, and about working across the whole of government—[Interruption.] Opposition Members are making the mistake of thinking that the only thing that matters is the amount of money that is available to spend, when what matters is how we spend it—a lesson that, sadly, the Opposition failed to learn during 13 years in Government. That is why they wasted so much taxpayers’ money and we are now paying the price.
Bob Stewart (Beckenham) (Con)
When I watched the police videos of what happened in Beckenham and Bromley, I was aghast to see families arriving in cars and then getting out and going on organised looting trips, and those family members were not the usual suspects. Is there anything we can do to stop this opportunist thievery?
Mrs May
My hon. Friend makes the point that we did see some opportunist criminal activity during the riots, but I remind him that just under three quarters of the people involved in the riots who have been identified so far had a previous criminal record of some sort and that 25% had 10 or more criminal offences on their record. So what we saw was sheer criminality on our streets.
Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)
Crime in my borough of Hackney is at its lowest for 12 years and Hackney’s integrated gangs intervention unit has seen a drop in gang violence of 59% in the 18 months that it has existed. I hope that the Home Secretary will place in the Library the details of where the £10 million will be allocated and that she will seriously examine the issue of gang injunctions. My local police and the integrated gangs intervention unit say that there are real challenges in getting gang injunctions to stick. They and I plead with the Home Secretary to re-examine antisocial behaviour orders and keep them until she is sure that gang injunctions work. Will she tell the House how many gang injunctions have been issued to date?
Mrs May
The hon. Lady raised a number of issues. The amount of money made available to Hackney from the early intervention grant allocation in the current financial year was, of course, about £20 million. We will be identifying the areas that the Home Office funding will be going to. As I said in response to the right hon. Member for Salford and Eccles (Hazel Blears), we have also already put money into Greater Manchester, the west midlands and London—the three areas where most knife crimes are committed—in looking to work with projects to tackle those knife crimes. So that funding has been available.
Only a small number of adult gang injunctions have been introduced so far. As the hon. Lady will know, the injunctions were introduced only earlier this year, but their use is increasing. I am aware that there were some issues in the early days in relation to their implementation, but we are getting through those teething problems and the gang injunctions have been used in areas where they have been effective.
Kris Hopkins (Keighley) (Con)
I welcome the Home Secretary’s statement. Yesterday, two gang members from my constituency were found guilty and sentenced, one to an indefinite term for firing a double-barrelled shotgun in a drive-by shooting. Does she agree that violent criminals must be given the most serious sentences to stop them bringing fear and destruction to our towns, and that this Government will relentlessly pursue these individuals?
Mr Speaker
Order. In seeking to accommodate more colleagues, notwithstanding the pressures of time, I do appeal now for extreme brevity in questions and answers alike.
Heidi Alexander (Lewisham East) (Lab)
The Home Secretary has said that she has reallocated £10 million-worth of early intervention money to focus on gangs and serious youth violence. However, her Government will spend five times that sum on the elections for police and crime commissioners. I say to the Home Secretary: why not take that £50 million and put it instead into the local projects that are already saving lives and of which she has already spoken so highly?
Mrs May
The hon. Lady seems to have failed to notice that this Act has actually passed and the police and crime commissioners will be introduced. They will be carrying out a very important task—that of being a directly elected local voice for local communities to determine policing in their area.
Bob Blackman (Harrow East) (Con)
I welcome today’s statement and commend the work of the Met police in combating gang cultures across London. That work is very expensive. It is also time-consuming and takes many years to come to fruition, and once the police do it and break the gang, a vacuum is created into which another gang can move. What actions can be taken to prevent new gangs from being formed where an old gang has been eliminated?
Mrs May
This is why we are absolutely clear that this is merely the start of a process and that what we are doing is putting in place sustainable, long-term work. It is necessary not just to bring certain individuals out of gang membership, but, sadly, to ensure that we prevent other young people from becoming part of new gangs that would replace those existing gangs. That is why preventing people from getting into gang membership in the first place is a key element of what we want to do.
Tony Lloyd (Manchester Central) (Lab)
The Home Secretary will know that the success in Greater Manchester in reducing gun crime has been through this type of multi-agency working, so what she describes is the application of common sense. However, resources do matter because many of the agencies involved are under financial pressure. Will she introduce an independent element of monitoring to ensure that we can see that the issue of money will not stop the effectiveness of these programmes?
Mrs May
I commend the work of Greater Manchester police, which has done excellent work in its Excalibur project. As the hon. Gentleman says, cross-agency working has made a very real difference to what it has been doing. I come back to the point that has been raised by many Opposition Members about funding and money. The issue is about how we spend the money that is available and about making sure that it is targeted on the right people and on interventions that are going to be effective. Over the years, Governments have spent so much money on dysfunctional families and on individuals who are gang members, but often to no effect. We must change that.
Graham Evans (Weaver Vale) (Con)
Does the Home Secretary agree with the comments of Jacqui Smith this morning that Labour had not done well enough on tackling gang crime?
Mrs May
I am grateful to my hon. Friend for reminding us what the former Home Secretary said this morning. Her comments are in stark contrast to those from Opposition Front Benchers today, showing real recognition that there was more to be done and that Labour did not have all the answers, as well as, I am sure, supporting the work we are doing.
Ann Coffey (Stockport) (Lab)
The response of local safeguarding children boards to the recent investigation by the Child Exploitation and Online Protection Centre into the extent of child sexual exploitation has been very disappointing. Will the Home Secretary ensure that directors of social services who have a statutory responsibility for child protection respond to any request for evidence regarding children who are vulnerable to gang-related violence in the preparation of her cross-departmental report?
Mrs May
The hon. Lady raises a very important point. The issue of child sexual exploitation is also being looked at by the Children’s Commissioner, who has undertaken research in this area. It is right that we should get the right response when an individual has been identified as being vulnerable and I shall certainly draw the hon. Lady’s comments to the attention of my right hon. Friend the Secretary of State for Communities and Local Government.
Gavin Barwell (Croydon Central) (Con)
I warmly welcome my right hon. Friend’s comprehensive statement. Communities such as mine will welcome her honesty in accepting that Governments of both persuasions have not done enough to tackle this problem in the past. May I press her on one point? Is it not the case that the police and Government agencies on their own are not going to solve this problem and that working with the communities who are affected and getting them to turn against gang members within their community is a key element?
Mrs May
My hon. Friend makes a very important point. This is an area in which the Government do not have all the answers and cannot achieve the necessary results by working on their own. As I indicated in response to an earlier question, what is often going to be most effective at helping young people to come out of gang membership or at preventing them from getting into a gang in the first place is groups in the voluntary sector and operations such as Kickz through which the Premier League and the Football Foundation are working to provide alternative activities for young men on a Friday or Saturday night.
Sheila Gilmore (Edinburgh East) (Lab)
The Home Secretary has praised the Strathclyde project greatly. That project cost about £5 million over two years, so how can £10 million being spread over 30 areas get anywhere near the success of the Strathclyde project?
Mrs May
I have commented favourably on the Strathclyde project but it is not the only project that is working across the UK. The Matrix project in Merseyside, the Excalibur project in Greater Manchester, and the work of the Met in certain parts of London have also been effective, and in Birmingham, the West Midlands police are also doing very good work in this area. I come back to a point that I have made on a number of occasions in response to questions from Opposition Members—this is about ensuring that money is spent in a way that will be effective. Sadly, in nearly an hour of questions, no Opposition Member has sought fit to recognise that the cuts in spending taking place across the public sector are because of the financial deficit left by the previous Government.
James Morris (Halesowen and Rowley Regis) (Con)
May I welcome the cross-government approach to solving this problem? Does the Home Secretary agree that the most important thing in relation to resources is that they are genuinely devolved to the local areas and communities that are best placed to tackle difficult underlying problems?
Mrs May
We are taking a different approach. It is important to recognise that there is no one-size-fits-all model that can be imposed on every local area. Local areas will need to come to an understanding of what is going to work in their particular communities. That is why it is important that responsibility is devolved and that funding is available at the local level. It is also why the ending gang and youth violence team that we will be setting up will be available at a local level to work with the agencies to ensure that they are getting the answers that are going to work.
Joan Ruddock (Lewisham, Deptford) (Lab)
I can assure the Home Secretary that money spent by Lewisham council and the police has been very effective, but since the right hon. Lady has been in power cuts to the community safety and youth offending team budgets have been of the order of 20% and the number of victims of knife crime has risen by almost 40%. Does she honestly believe that those two things are not connected?
Jake Berry (Rossendale and Darwen) (Con)
I have seen personally the wraparound support provided by voluntary mentoring in my constituency, especially by the Lighthouse Foundation supported by the Methodist Church. Will my right hon. Friend update the House on what role voluntary mentoring can and will play in tackling gang violence and family breakdown?
Mrs May
Voluntary mentoring of individuals can have an incredibly important role to play in tackling both gang membership and youth violence. There are many projects out there in which voluntary and charitable groups provide necessary support to families that helps them to bring up their children in a way that prevents them from going down the route of gang violence. I commend the project that my hon. Friend mentions. I am sure that it is doing excellent work in his constituency, as it does elsewhere in the country.
Richard Burden (Birmingham, Northfield) (Lab)
The Home Secretary has on several occasions emphasised the importance of partnership working between the statutory agencies and the voluntary sector, not only to divert young people from joining gangs—I hope that we do not see all young people as a potential problem—but to bring out the talents that they have inside them. Even if the right hon. Lady does not like what Opposition Members are saying about resources, does she accept that youth workers and voluntary groups are also saying that the resources are not enough? What assurances can she give them, if not us, that she is listening to them?
Mrs May
Of course the vast majority of young people are not involved in gang membership and violence. We should recognise that all too often the only stories that people read about young people are bad stories, not good ones. The House should perhaps do more to recognise that the vast majority of young people do not get involved in this sort of activity.
I have seen across the country that what makes a difference is how you spend the money that is available, targeting those who are most in need, and targeting money effectively. Sadly, over the years money has been spent that has not led to a change. We want to change young people’s lives.
Catherine McKinnell (Newcastle upon Tyne North) (Lab)
We did not witness riots in Newcastle over the summer thanks in large part to significant investment and partnership work supporting engagement with young people in the city. Does the Home Secretary share any concern that cutting 544 police officers, 185 community support officers and 60% of community safety funding has the potential to undermine that good work?
Steve McCabe (Birmingham, Selly Oak) (Lab)
The Met has said that gang association is one of the most difficult things to prove evidentially. How will the Home Secretary be confident that those who benefit from all the incentives that she is offering people to give up gang membership are genuinely gang members and not just the dispossessed who have had all other avenues closed down and have to claim to be gang members to get some help?
Mrs May
As I said, we are working with ACPO in particular to map incidence of gangs and gang memberships. Obviously at local level that will rely on information that is available to the police and other agencies. We are focusing not just on gang membership but on gang and youth violence. So in some areas work will be undertaken on a broader remit than simply looking at gang members.
Kate Green (Stretford and Urmston) (Lab)
The Home Secretary has rightly emphasised the importance of community leadership in tackling and addressing gang violence. She will of course be aware that there is a risk that the community can become alienated if public agencies get the relationship wrong. How will she ensure that the good will of communities, which is so essential to the success of her proposals, is secured and monitored?
Huw Irranca-Davies (Ogmore) (Lab)
The point has been rightly made already that, on their own, police boots on the ground are not the solution to gang and youth violence; there has to be a much more joined-up approach. Does the Home Secretary share any of the concern about the loss of something like 1,900 police from the Metropolitan area? Will it have no impact whatever on the strategy that she has outlined today?
Mrs May
As I have said in the House on many occasions about the cuts in police spending that are taking place, we know from evidence from Her Majesty’s inspectorate of constabulary and from other factors that it is possible to make cuts in police spending while maintaining front-line services.
Ms Karen Buck (Westminster North) (Lab)
The single most important thing that we can do is to create sustained trusting relationships between young people at risk of gang violence and responsible adults, whether volunteers in voluntary youth organisations or workers in statutory youth organisations. May I make a plea to the Home Secretary that we break with recent tradition and do not just make interventions that last 12, 20 or 30 weeks, which disrupt those relationships and often cause more damage than they prevent, but make sure that the interventions are there for years—for the duration? That is the way in which we shall disrupt the dysfunctional relationships of the street, and sometimes in families, that have led to the crisis.
Points of Order
(12 years, 6 months ago)
Commons ChamberRead Full debate Read Hansard Text
Paul Goggins (Wythenshawe and Sale East) (Lab)
On a point of order, Mr Speaker. I seek your advice about the reduction in the time that will now be available for debate on the first group of amendments to the Legal Aid, Sentencing and Punishment of Offenders Bill. When we voted on the programme motion yesterday, we did not know that there was to be an important statement from the Home Secretary about gangs and youth violence. The consequence of the statement is that a wholly inadequate two and a quarter hours for debate will now be little more than one hour, barely time for the Front-Bench spokespeople to exchange views. Could you give us advice, Mr Speaker? These are controversial amendments, which deal with the sentencing of the most dangerous people in our community, yet they have been introduced not at 5 minutes to midnight but at 1 minute to midnight, with no debate on Second Reading or in Committee. Is there any way that we can reclaim that time, Mr Speaker, and will you make it clear to Ministers that you will not put up with this abuse of the parliamentary process?
Mr Speaker
I am grateful to the right hon. Gentleman for giving me advance notice of his point of order. I fully understand the frustration expressed about the short time now available for discussing the first group of new clauses on longer sentences. The right hon. Gentleman will know that on the one hand it is in effect up to Ministers when to make statements to the House and that on the other hand I am bound by the terms of the programme motion agreed yesterday by the House. I can only advise him to make his point to the Procedure Committee whose Chairman is lurking, doubtless with intent, at the back of the Chamber, and has now progressed into the main body of the Kirk, for which we are grateful. Others will no doubt also have heard the right hon. Gentleman’s point.
Because this is an immensely serious matter, I would in addition appeal for extreme brevity from the Front Benches—a brevity that we did not witness yesterday—in the debates today, and from Back-Bench colleagues, so that matters of great importance to those outside the House can be properly considered.
Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)
On a point of order, Mr Speaker. Since August I have been in contact with the Home Office about the timing of today’s statement and talking about a cross-party meeting. Last Wednesday I asked the Prime Minister when the gangs report would be published and he said, “When it’s ready.” Yesterday I got an answer to a named-day question which said it would be published soon, yet on Sunday night on The Guardian website it was announced that it would be presented to the House today, and in today’s papers the detail was revealed. I ask your views on this and wonder whether it may be time for the House to throw in the towel and look first to The Guardian website for information about what the Government are doing, rather than expect the courtesy of the House being informed first.
Mr Speaker
I reiterate what I have said before, which is that Ministers should make key statements to the House first. I would never advise any Member to throw in the towel, as the hon. Lady puts it. There is significant evidence of important statements starting to be made first in the House. Ministers know that when that does not happen, there is a strong possibility of an urgent question application being granted. That did not use to happen; it now happens on a substantial scale, but I think it would be fair to say that achieving progress in these matters is not a matter of an isolated act, but rather of a continuous process. The point of order demonstrates that this is very much work in progress. We have no reason to be complacent. That point is addressed not least, as it has to be, to those on the Treasury Bench.
Education and Training (Young People with Autism)
(12 years, 6 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Mr Lee Scott (Ilford North) (Con)
I beg to move,
That leave be given to bring in a Bill to require the Secretary of State to make provision for the education and training of young people with autism and Asperger’s syndrome; to ensure that work opportunities are provided for those young people; and for connected purposes.
One of the biggest worries for parents who have children with autism, Asperger’s or any other special needs is what will happen when they are no longer here. Will the young person, when they become an adult, be able to look after themselves? Will they have gainful employment? I pay tribute both to my own Government and to the previous Government for the work that has been done to try to make headway on employment for young people suffering with autism, Asperger’s and any other special needs.
According to the National Autistic Society,
“There are more than 350,000 working age adults with autism in the UK. NAS research has found that, whilst many people with autism want to work, just 15% of adults with autism are in full-time paid employment and 9% are in part-time employment.”
Research shows that 79% of people with autism on incapacity benefit want to work, but need some support to get into work and retain employment. One in three people with autism is without any financial support from employment or through the benefits system, with many reliant on their families for such support. In a study carried out by Research Autism in 2008 for NAS Prospects London on the experiences of employing people with autism, seven in 10 employers questioned had had a very positive experience of employing people with autism, Asperger’s or other related conditions, and said that they would recommend it to others.
BBC Radio York contacted me this morning about the parent of a young son with autism. The parent filled out an application form for a job and filled out another for the son. The application form requested that a box be ticked if the applicant had a disability: the form indicating no disability got the applicant an interview, whereas the applicant whose form indicated there was a disability did not. Whatever the employment climate is, and however difficult things are, people with autism are not getting a fair chance.
I want to praise an organisation called Kisharon, which runs a printers and a bicycle repair shop staffed solely by young people with autism, Asperger’s or other special needs. Together with a group called Interface, which is one of my local groups serving young people with autism, Asperger’s or any special needs, and the London borough of Redbridge, with private backing—I am sure the Treasury will be pleased to hear that, as there will be no financial impact on the Treasury—they are looking at how we take matters forward.
I have had meetings with leading companies where we plan to run a pilot scheme that will allow them to employ young people and for the young people to have training through local authorities so that they can achieve what they deserve—the best possible future. Obviously, I am not a professional and could not decide who would be suitable for what role.
I came into contact with one young man who found it difficult to interact in the workplace. An employer took this young man on, although there were difficulties. There were days when perhaps the young man took offence or had a problem with things that others may not have, but that firm took that into account and worked with that young man and he has now been there for some three years and is a valued employee. For obvious reasons, I do not intend naming him.
I also want to consider how this scheme can be rolled out. At the outset, these young people need to be assessed. We need to know what skills they have. We know only too well that many young people with autism or Asperger’s syndrome are brilliant with computers and IT, but may not have great communication skills in the workplace. There is no reason why they cannot work from a satellite centre or from home.
The scheme must be overseen, because people have to be put forward as mentors in companies to work with young people and make sure that it works out. I hope to work with my Government and with charities such as the National Autistic Society, Kisharon, Interface and many others to take this forward and to run a pilot to get young people into employment and achieving as much as possible.
I return to the point about where such people might live. Many parents are concerned about what will happen to their child when they are no longer around. I have visited many small houses where four or five young people live with a housekeeper but look after themselves and go out to employment and to courses. That is the way forward for people in this group. We then need to analyse the programme’s outcomes over the years. I know from my conversations with the National Autistic Society and others that they want to see it rolled out throughout the country, so that the young man in York can find employment just as easily as the young man living in Ilford North or Redbridge.
Lord Freud has taken this matter forward in the other place and is meeting businesses, and I look forward to working with him on this. If we do not take this forward and get involved in helping, we will truly be letting down some of the most vulnerable people in our society. We all have concerns about youth unemployment. We heard them during the statement on gang crime and we have heard them in various debates, but I do not believe that anyone is happy with the present situation. I know that my Government want to take action on this. Words from me are not enough and I sincerely hope that I will receive the backing of every Member in the House today and can then return in a year’s time and say that this is working for the young people who have autism, Asperger’s and other special needs. I hope that I will be able to work with everyone in the House to achieve it and show that it is a success.
Question put and agreed to.
Ordered,
That Mr Lee Scott, Jon Cruddas, Dr Sarah Wollaston, Mike Gapes, Mr Brian Binley, John Cryer, Simon Kirby, Mr John Leech, Robert Halfon, Paul Maynard, Dr Julian Huppert and Mr. Robert Buckland present the Bill.
Mr Lee Scott accordingly presented the Bill.
Bill read the First time; to be read a Second time on Friday 20 January 2012, and to be printed (Bill 242).
Mr Speaker
Before we come to the main business of the day—the Legal Aid, Sentencing and Punishment of Offenders Bill—we have a point of order.
Karl Turner (Kingston upon Hull East) (Lab)
On a point of order, Mr Speaker. May I have some guidance on whether it is appropriate for the Under-Secretary of State for Justice, the hon. Member for Huntingdon (Mr Djanogly), to speak for the Government on this part of the Bill, given the media interest from The Daily Telegraph and The Guardian in his business interests in the insurance industry? I know that the Government have had a problem with this because they took part of his responsibilities from him on 17 October.
Mr Speaker
The short answer to the hon. Gentleman is that it is for Members to take responsibility for their own interests and, as necessary, if they think it appropriate, seek advice from the Registrar, and there is of course an obligation upon Ministers, of which the Minister will be well aware, to comply with the ministerial code, but beyond that no special comment needs to be made on the matter. It is perfectly proper for the Government to decide which Minister should take the proceedings on the Floor of the House.
The Parliamentary Under-Secretary of State for Justice (Mr Jonathan Djanogly)
Further to that point of order, Mr Speaker. Given that my financial interests have today once again been regurgitated by the hon. Member for Kingston upon Hull East (Karl Turner), and given that they formed the subject of a complaint by his colleague the hon. Member for Bassetlaw (John Mann), I think it is wrong of him, almost to the point of being misleading, not to mention that the Cabinet Secretary found, and informed his hon. Friend of the fact, that I had declared my relevant interests, had not acted in conflict of interest and had acted in the public interest. Will the hon. Gentleman now acknowledge that?
Mr Speaker
The Minister has put the position, including new evidence, very clearly on the record. However, points of order cannot be the occasion for a debate, which would be wrong. The Minister has clarified the position, Members will have heard it—
Mr Speaker
Order. The Chair of the Select Committee, the hon. Member for Beverley and Holderness (Mr Stuart), has important responsibilities in the House. I do not want him at this early hour to get overexcited; that usually happens later in the day, not yet. Let us proceed in a seemly manner with the help of the Chair of the Select Committee.
Legal Aid, Sentencing and Punishment of Offenders Bill
(12 years, 6 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
18:00 - The House divided: - Ayes: 311 / Noes: 235 - Question accordingly agreed to.
19:32 - The House divided: - Ayes: 208 / Noes: 302 - Question accordingly negatived.
22:00 - The House divided: - Ayes: 23 / Noes: 300 - Question accordingly negatived.
The Lord Chancellor and Secretary of State for Justice (Mr Kenneth Clarke)
I beg to move, That the clause be read a Second time.
Mr Speaker
With this it will be convenient to discuss the following:
Government new clause 31—Life sentence for second listed offence.
Government new clause 32—New extended sentences.
Government new clause 33—New extended sentences: release on licence etc.
Government new clause 34—Power to change test for release on licence of certain prisoners.
New clause 3—Determination of minimum term in relation to mandatory life sentence—
‘In Schedule 21 of the Criminal Justice Act 2003—
“(a) Substitute paragraph 5(2)(g) with—
“(g) a murder that is racially or religiously aggravated or aggravated by sexual orientation or disability,”
(b) Substitute paragraph 5A(10)(b) with—
“(b) the fact that the victim was at greater risk of harm because of age or disability,”.’.
Government new schedule 4—‘Life sentence for second listed offence etc: new Schedule 15B to Criminal Justice Act 2003 Offences listed for the purposes of sections 224A, 226A and 246A.
Government new schedule 5—‘Life sentence for second listed offence: consequential and transitory provision.
Government new schedule 6—‘New extended sentences: consequential and transitory provision.
Government new schedule 7—‘Release of new extended sentence prisoners: consequential provision.
Mr Clarke
The new clauses and schedules relate to the abolition of sentences of imprisonment for public protection, known as IPP sentences. They were introduced in the Criminal Justice Act 2003 and have been in operation since 2005. Since their introduction, there have been numerous problems with them. The Government’s policy is that they must be replaced, and we have brought forward proposals to do so. My proposals to replace them with tough determinate sentences have inevitably aroused criticism from both the right and the left—the story of my life, as I complained yesterday. We are replacing a regime that did not work as it was intended to with one that gives the public the fullest possible protection from serious, violent and sexual crime.
The sentences in their present form are unclear, inconsistent and have been used far more than was ever intended or contemplated by either the Government or Parliament when the sentence was first created. The right hon. Member for Sheffield, Brightside and Hillsborough (Mr Blunkett), who is in his place, was very much involved in their introduction. I have no idea exactly what his view is now, but I am sure that he never imagined that thousands of people would be detained in prison indefinitely under these sentences. The debates at the time contemplated only a few hundred people.
Mr David Blunkett (Sheffield, Brightside and Hillsborough) (Lab)
I shall be extremely brief, given the time. It would be helpful, following the Secretary of State’s meeting with me and my right hon. Friend the Member for Wythenshawe and Sale East (Paul Goggins), if he assured the House that reconsideration of the detail will take place in the House of Lords. There is no difference between those of us who accept that the original intention has not been followed through and those who think that the changes that my right hon. Friend the Member for Blackburn (Mr Straw) introduced have not fully bitten as intended, but the propositions before us this afternoon do not meet the specific need that was identified back in the early 2000s by my right hon. Friend the Member for Blackburn, and which I carried into being.
Mr Deputy Speaker (Mr Lindsay Hoyle)
Order. The right hon. Gentleman knows that he should make a short intervention, not a speech at this stage.
Mr Deputy Speaker
Order. I remind the right hon. Gentleman that he may have finished, but he should not take so long in future.
Mr Clarke
I am grateful to the right hon. Gentleman, and I will remember the need for extreme brevity. I am grateful for the discussion with the right hon. Members for Sheffield, Brightside and Hillsborough and for Wythenshawe and Sale East (Paul Goggins), and I will follow up the account by the right hon. Member for Wythenshawe and Sale East of the experience in Northern Ireland. We all acknowledge that where we are is not where anyone intended us to be. That is why we are addressing how to deal with serious and violent offenders.
I am sure that the words of the right hon. Member for Sheffield, Brightside and Hillsborough will be noted in the House of Lords. He speaks here with great authority. We will reflect on what is said by those who say that of course we have not got it quite right.
Mr Clarke
Normally I would give way, and if we had a full day of debate, I would have expected to give way to Members on both sides of the Chamber—[Interruption.] It is not my fault. Let me first finish explaining the general case. I will then try to give way as generously as I can. It would be quite possible to take so many interventions that they filled the remaining time, but I have no intention of doing so.
I remind the House that in June the Prime Minister announced that the Government intended to replace IPP sentences. He and I had agreed on that. We had originally proposed in our Green Paper greatly to restrict the number by raising the threshold above which IPP sentences were given. The sentencing parts of the Bill were received extremely well in public consultation because those who responded were largely those involved in the criminal justice system, but we received many representations saying that IPP sentences should abolished completely, which is why we have moved on.
Mr Clarke
I said that I would give way when I had finished my general points, and I will do so in a few moments.
I was referring not just to my opinion and that of the right hon. Member for Sheffield, Brightside and Hillsborough. I shall remind the House of some of the people who have said similar things. Louise Casey, the Commissioner for Victims and Witnesses, whose appointment to deal with problem families has been welcomed, said that she was pleased there would be a review of indeterminate sentences as they
“often leave victims in a horrible situation of not knowing when a criminal may be released from prison”.
She welcomed the proposal that tougher determinate sentences will be sought instead. Tim Godwin—as we all know, he was acting Metropolitan Police Commissioner until recently, and is now deputy commissioner and the criminal justice lead for the Association of Chief Police Officers—said he welcomed the review of IPP sentences and its focus on robust alternatives that will ensure the public is protected from the most serious offenders, as it is a source of frustration for victims and their families as to what a sentence actually means.
I cannot resist adding that the shadow Justice Secretary has suddenly taken up an extraordinarily far right position on this issue at the last moment. I have looked up what position he took, or at least what position Liberty took when he was its chairman in 2002, when indeterminate sentences were first introduced. At that time Liberty, under his chairmanship, denounced IPP sentences as
“a convoluted sleight of hand”
which aids neither accessibility of law for transparency in the sentencing process. His successors at Liberty have not changed their mind. I said yesterday that tomorrow he would press an amendment that has mandatory sentences for 12-year-olds. Old Fabians must be spinning in their graves as the former chairman of the Fabian Society takes up a totally opportunist position.
What is wrong is that indeterminate sentences are unfair between prisoner and prisoner. The Parole Board has been given the task of trying to see whether a prisoner could prove that he is no longer a risk to the public. It is almost impossible for the prisoner to prove that, so it is something of a lottery and hardly any are released. We therefore face an impossible problem.
As I have said, IPP sentences are piling up, and they have been handed down at a rate of more than 800 a year even after the changes made in 2008. At the moment, more than 6,500 offenders are serving those sentences, of whom more than 3,000 have finished what the public regard as their sentence—the tariff for what they have done. If we do not do anything about it, the number of IPP sentences will pile up to 8,000 or 9,000 by 2015—10% of the entire prison population. Sometimes, their co-accused who committed the same crime and were given a determinate sentence were released long ago. That is unjust to the people in question and completely inconsistent with the policy of punishment, reform and rehabilitation, which has widespread support. Only Opposition Front Benchers are still in favour of a punishment that leaves a rather randomly selected group to languish indefinitely in prison, for their lifetime if necessary.
Derek Twigg
Has the Secretary of State been listening to police officers such as the one in my constituency who has written to me to say that IPP sentences are working? He gives the case of an individual who set fire to a house, causing danger to others, who clearly presented a serious risk to the public. That police officer states:
“IPPs are a very useful tool for the Courts and I respectfully suggest that they should be retained and any issues with how they are implemented be looked at instead.”
That is a police officer serving on the front line.
Mr Clarke
I do not claim rank for Mr Godwin, but I quoted what he has said on behalf of ACPO. Of course there are always dissenting views—I have never presented any proposal on anything that has had 100% approval—but the overwhelming majority of responses from those involved in the criminal justice system suggested that IPP sentences should be repealed. Those are not people who wish to be soft on crime, but they believe that IPP sentences have not worked as intended, as we have already heard in today’s exchanges, and need to be replaced. To reassure policemen, such as the one that the hon. Gentleman mentions, that a tough new regime will give them protection, I will spell out elements of the new regime.
Philip Davies (Shipley) (Con)
Is not the fact of the matter that indeterminate sentences have a very low reoffending rate, and that most members of the public rather like the idea that people are not released from prison until it is safe? What will my right hon. and learned Friend do to ensure that people who are released go through all the necessary treatment and programmes to address their offending behaviour before they are released?
Mr Clarke
My hon. Friend’s last point is perfectly fair, and I am about to make some points that should reassure the great bulk of the public. Of course we must have in place a very effective method of dealing with all those who commit the worst sexual and violent offences. No one is suggesting that we do not need an effective regime for that.
For the very serious offenders, the ones who are among the worst of the likely inhabitants of Her Majesty’s prisons, there will be a new mandatory life sentence. That will apply in cases in which the offender has committed, on two consecutive occasions, two very serious sexual or violent offences, when each of which has been serious enough to merit a determinate sentence of 10 years or more.
I was criticised from the left in another place, and probably will be here, for introducing a new mandatory life sentence. We have only one at the moment, which is for murder, and everybody accepts it. As I have said, however, the new mandatory sentence is mainly intended to reassure those who, like my hon. Friend, are worried that the worst offenders might occasionally get out. We are talking about very serious offenders, most of whom would get a life sentence anyway if they had committed two offences meriting determinate sentences of 10 years or more. I do not think that many such people would avoid a life sentence, but as hon. Members can see, a life sentence in the new clause is subject to a caveat—the offender will receive a mandatory sentence unless their circumstances or the circumstances of the offence
“make it unjust to do so”.
Mr Jack Straw (Blackburn) (Lab)
Will the right hon. and learned Gentleman explain the practical difference between an offender who is given an IPP for, say, a minimum tariff of five years, who will then be released by the Parole Board on proof of meeting certain conditions, and someone who is given a discretionary life sentence with a tariff of five years who is released by the Parole Board on exactly the same conditions? What is the difference?
Mr Clarke
Well, there are differences in the regime, the sentence planning and so on, but not very many. I will go back to the point about the regime that we want to introduce for people with extended determinate sentences, but the right hon. Gentleman makes my point. What is wrong with saying that the courts should use the ordinary life sentence? They will use a life sentence when they judge that a case is so serious, and when future risk is so high, that it is the only proper sentence.
For other offenders, we are introducing a new extended determinate sentence. The offender will receive a custodial sentence plus a further long extended period of licence set by the court. Those will be quite long determinate sentences, and the offenders who receive them will serve at least two thirds of them. In serious cases, offenders must apply to the Parole Board for release, and the board may keep them inside until the end of the determinate sentence.
Mr Clarke
I shall just finish explaining this point and then answer questions.
The new sentence can be given for any sexual or violent offence, provided that the court thinks the offender presents a risk of causing serious harm through reoffending, and that the offence meets the four-year seriousness threshold that is currently in place for IPP sentences and extended sentences for public protection. The new sentence can also be given when the offender does not reach the four-year threshold, but has previously been convicted of an offence listed in proposed schedule 15B. I will cut out further detailed explanation, but that means that any offender who would previously have received an IPP will be eligible for the new sentence if he has not received either the mandatory life or the tougher, discretionary life sentence.
Sir Alan Beith (Berwick-upon-Tweed) (LD)
I very much agree with what my right hon. and learned Friend is trying to do, but he is writing what is the likely practice of the court into the statute book. He mentioned the Parole Board and new clause 34, which causes me concern. He appears to be giving to himself and the Executive the power to direct a court when dealing with existing IPP prisoners, because the Parole Board is regarded in law as a court, and he will give directions to it under new clause 34.
Mr Clarke
I shall come to the Parole Board before I conclude my remarks, but we are not taking away its power: nobody who previously had an IPP will be released, even at the two-thirds point, unless they have first satisfied the board.
The most obvious difference between life sentences, which will now be used more widely, and IPP sentences is that, in the case of life imprisonment, licences are for life and subject always to recall, whereas IPP sentences are not. However, as I said, criminals who complete an extended determinate sentence must then serve extended licence periods, during which time they will be closely monitored and returned to prison if necessary. The courts have the power to give up to an extra five years of licence for violent offenders and eight years for sexual offenders on top of their prison licence.
There are further protections. Some people believe—the Labour Front Bench team certainly affect to believe—that we are exposing people to risk by making this much overdue change. We are also introducing—not in the legislation, but I undertake to introduce them—compulsory intervention plans for dangerous offenders while they are in prison, so that they are supported to change their ways and not commit more crimes when they are eventually released. By the end of sentence, offenders should therefore have undergone interventions—made in a more certain and organised way than at present—to address their offending behaviour.
There is rightly concern that those currently serving IPP sentences should be supported in progressing through their sentences and achieving release on licence. However, we will be using our best efforts to improve the progression of these prisoners through sentence, including with improvements to assessment, sentence planning and delivery, and parole review processes. We continue to monitor outcomes to ensure further improvements in this area.
There are yet further protections available to the court. We do not believe that our proposed changes put the public at risk or weaken our risk-management regime. Most sexual or violent offenders sentenced to 12 months or more in custody will fall under the multi-agency public protection arrangements framework, which means that the relevant authorities will work together to co-ordinate assessments of risk and risk-management plans for the offender once they have been released on licence. Robust risk-management systems are now in place for a range of offenders. Court orders are also available to manage the risk of serious sexual and violent offenders who appear to present a risk at the end of their sentence. Violent offender orders and sex offending prevention orders place restrictions on these offenders, and if they breach those orders, they can be sent back to prison.
In the sentencing Green Paper, we raise the question of whether the Parole Board’s test for release in these cases is the right one, because only a tiny number of people ever emerge from prison at the moment—the rate is less than 5% a year—and we are acquiring people who are still in prison years after they finished the tariff that the judge imposed on them. This is a question that we will explore further. The amendments give the Secretary of State a power to change the release test used by the Parole Board, which is set in statute for IPP prisoners and for prisoners serving the new extended sentence. The power will be subject to the affirmative procedure. We will consult carefully and see what happens to the Parole Board and the courts once we have made the present form of sentence extinct for former prisoners.
The trouble now is that someone who has finished his tariff has to stay in prison unless he can persuade the Parole Board that it is safe to let him out. [Interruption.] That is it; that can be difficult, sitting in a prison cell, although we are going to produce some management plans. On the other hand, if we are keeping someone in beyond their tariff, it is certainly arguable that we should have some positive reason for fearing that there is a risk that he is going to offend when he leaves. We have to reflect—we will consult on this—on whether we have been giving the Parole Board an almost impossible task. It is no good pretending that it can come to a scientifically certain conclusion in each case. None of us would like to say, if we met a range of prisoners, which were now reformed and which would offend again. The Parole Board gets it wrong now: some of those it releases offend again, while some of those in prison are never going to offend again, if we can actually get them out. We will consult on whether the current release tests for IPP sentences and the new extended indeterminate sentence ensure effective public protection while allowing everyone to be satisfied—as far as they can ever be satisfied in this world—that the offenders can now be safely managed in the community.
Mr Straw
Some 40% of discretionary and mandatory lifers are post-tariff. They have to prove that it is safe to release them. Can the Secretary of State please explain what the difference is in substance between someone on a life sentence who has to satisfy the Parole Board that it is safe to release them and someone on an IPP?
Mr Clarke
It is not. What I think the right hon. Gentleman is saying—I will listen to him in a moment—is that he proposes to defend what is left of the last Government’s proposals, the author of which acknowledged quite early in my speech that they plainly needed to be changed. If I get the chance, I will listen to what the right hon. Member for Blackburn (Mr Straw) is trying to argue, but he seems to be reassuring us that life sentences fulfil that requirement for the very worst people—that they are looked at carefully before being let out again—and those people will be on licence for life: once they start going in for aberrant behaviour, they can be recalled to prison and punished once more.
Apart from the very outlying people on the right and the left, I hope that I have satisfied everybody. It is high time that we reformed indeterminate sentences. Personally, I am amazed that they have survived judicial review and challenge in the courts thus far, but if something was not done, they would not survive very much further, which would lead to unfortunate consequences if a court suddenly started ordering us to release such prisoners and decided that they were being held unlawfully. I have recently described them as a “stain on the system”. I said that at a private meeting in the House of Lords—although it soon found its way into the press—but it is my opinion. What we are putting in place is protection for the public: far more rational, certain, determinate sentences, which is much more in line with how we think the British system should behave.
I will, of course, be followed in this debate by the right hon. Member for Tooting (Sadiq Khan). I have already expressed my amazement at his position, and I have found some other quotations from him in my time. I cannot understand how he can match up to his present position. For example, when we both started in July last year, his leader—the current Leader of the Opposition—said:
“I don’t think we should try to out-right the right on crime,”
and said that I was
“opening up an opportunity for us to redefine part of the debate about criminal justice.”
Only a few weeks ago, addressing the Howard League, the right hon. Member for Tooting said—in a lecture that I thought put him in a very convoluted position between his conscience and where he is at present—that
“our big challenge is to communicate that punishment and reform can and should go hand-in-hand…To deliver this calls for an honest debate”.
The right hon. Gentleman, the shadow Justice Secretary, is a radical lawyer from south London—he is more radical than I am—and he is trying to “out-right” me in what is an absurd and hopeless case. What we are putting in place is an altogether rational and sensible system.
Sadiq Khan
I thank the Justice Secretary.
“Public safety remains our primary concern and indeterminate sentences will always be appropriate for the most serious crimes”—
not my words, although I agree with them entirely, but those of this Government’s Green Paper, “Breaking the Cycle”, which was published in December 2010. How things have changed in just 11 months: instead of what was said then, at the last minute—and after interference from No. 10 Downing street—there was suddenly no mention of indeterminate sentences when the Bill was published in June, more than four months ago. At the last possible moment—at one minute to midnight—we are presented with new clauses that propose the total abolition of indeterminate sentences.
Mr Kenneth Clarke
The right hon. Gentleman seems to be using his time to complain about not having enough time. Before he develops any conspiracy theories, may I make my position clear? I have spoken out against indeterminate sentences in the House before. The Green Paper proposed to restrict them, and I explained why. The announcement in June was made after the most careful discussion with the Prime Minister. We both agreed it, and the idea that I have been forced into accepting the abolition of indeterminate sentences is complete nonsense. The consultation process encouraged me to believe that serious people in the justice system were prepared to go for total abolition, and I leapt at the opportunity, as should the right hon. Gentleman, as a former chairman of Justice and of the Fabian Society. I cannot imagine where he thinks he is taking the labour movement to.
Sadiq Khan
We now know that, when this Government review policy, it means that they abolish it. This is the same Justice Secretary who signed off the Green Paper last December.
Not for the first time, the Government will have to leave it to colleagues from all parties and none in the other place to perform the scrutiny that this Bill deserves. The Justice Secretary is presenting us today with a blueprint that will risk more crime, more victims, and more serious and dangerous offenders being out on the streets. It is as simple as that, and he knows it. No amount of smoke and mirrors can disguise the fact that, by abolishing indeterminate sentences, he is risking the safety of communities in each and every constituency.
“Many dangerous criminals will be released, including repeat offenders, regardless of the risk they pose to the public.”
Those are not my words, but those of the right hon. Member for Arundel and South Downs (Nick Herbert), now the Minister for Policing and Criminal Justice, back in 2008, when he was commenting on the changes to indeterminate sentences that we made when we were in government. We made changes to them, but this Government are now proposing to abolish them altogether. What happened to the party that believed in law and order?
I spent a few minutes this morning finding recent cases in which judges had given an indeterminate sentence to a convicted offender to protect the public. I will not give the names of the offenders or the victims, as I do not want to cause the victims further distress. A South Wales police press release from September this year bears the heading “Indeterminate prison sentence for convicted rapist”.
It goes on:
“A Cynon Valley man described as a ‘dangerous individual’ has been given an indeterminate sentence for the rape of two women and wounding of another…D, who the judge described as a dangerous individual, will not be considered for parole for six years. D’s victims have released the following…statement: ‘Our lives will never be the same after the trauma D has put us through. We were physically, mentally, financially and emotionally abused and controlled by him. We are satisfied with the court’s decision to give him an indeterminate sentence and relieved that no-one else will suffer like we have.’”
In this October’s online version of the Birmingham Mail was the headline, “Teenager jailed for stab attacks on father and son in West Heath”. The article stated:
“A teenager has been given an indeterminate sentence for stabbing a father and son while they tried to protect a ‘petrified’ youngster who sought refuge in their Birmingham home…Judge William Davis QC said: ‘You stabbed both the householder and his son causing both of them significant injury. It is a very serious offence because two people were attacked on their own door step and one of them left perilously close to death.’ The judge said he believed J to be a ‘dangerous young man’. After sentencing”,
the victim said,
“I am extremely pleased the judge recognised the seriousness of the offence. It shows the public that carrying knives will not be accepted in society today.”
This month’s North-West Evening Mail contained the headline, “Caustic soda brute loses appeal against sentence”, and continued:
“A ‘dangerous and manipulative’ thug, who scarred a teenager for life by pouring caustic soda on her face, has been told by top judges he deserved his indefinite jail term…On Thursday G challenged his indefinite jail terms, with his lawyers also arguing the minimum five years he was ordered to serve before applying for parole was ‘excessive’. But his appeal was thrown out by judges sitting at London’s Criminal Appeal Court, who described G as a ‘very dangerous man’ who should not be released from prison until the Parole Board considers it safe to do so…Sentencing him, the crown court judge said he was a ‘controlling, manipulative, emotionless and uncaring man’ who was a danger to women…The appeal judge”,
Mr Justice Spencer,
“said: ‘The judge was quite correct to conclude that the appellant should not be released until the Parole Board deems it safe for him to be released.’”
Mr Kenneth Clarke
Can the right hon. Gentleman think of any good reason why, given the remarks he has provided about the sentences, that the perpetrators would not have been given a life sentence? Normally, people like that would get a life sentence. Since there have been IPP sentences, some people have got them, but in the cases the right hon. Gentleman describes, judges will go back to the normal practice of giving a life sentence.
Sadiq Khan
They will not. The right hon. and learned Gentleman’s proposals require there to have been a first offence, and the schedule provides for sentences of 10 or more years. The person found guilty will have to have come back for a second offence and be found guilty of an offence that also requires a sentence of 10 or more years. In all these cases—the right hon. and learned Gentleman knows this—the Government will have taken away from the judge who has heard all the evidence and knows the facts of the case the power to give the IPP sentence.
Mr Clarke
There is no qualification for a life sentence. People can be sent down for a life sentence for their first offence if it is serious enough and demonstrates the danger posed to the public. We are not introducing any qualifications at all to the power to give life imprisonment.
Sadiq Khan
I could not have demolished the arguments better than the right hon. and learned Gentleman just has. He makes the exact point for me. Under the proposals we are presented with today, our judges will be stripped of the power to prevent the most serious criminals from being released and going on to be a danger to society. We can imagine a scenario—and an horrific one at that—of someone committing a serious and violent assault being caught, charged and found guilty. Under the Government’s new proposals, I accept that they might receive an extended determinate sentence and be eligible for release after two thirds of their sentence, should the Parole Board be satisfied. However, even if the Parole Board were not satisfied after two thirds of the sentence had elapsed, there would be nothing to prevent release at the end of the full sentence handed down by the judge. Dangerous individuals would be released at the end of their extended determinate sentence irrespective of whether they posed a risk to the public. Under the new proposals, judges will be able to do absolutely nothing about that. They will be powerless to deprive the offender further of his liberty in order to keep the public safe. I should be happy for the Justice Secretary to intervene on that point, but he apparently does not wish to do so.
Mr Clarke
The right hon. Gentleman clearly did not understand my question. He gave some dreadful descriptions of dreadful cases, featuring what—when the full circumstances are known—are clearly some of the worst examples of violence and sexual offences that could be found. The point is, however, that such people will receive life sentences, because such sentences are available to the court, and they will not be released until someone is satisfied that they are no longer as great a risk as they were. They will be subject to licence for the rest of their lives, and it will be possible to recall them if they start behaving in any sort of threatening way. The life sentence fills the gap that the right hon. Gentleman claims I am creating. We are not changing the position at all.
Sadiq Khan
I realise that the Justice Secretary has not practised law recently, but if a judge could deliver a life sentence for such offences now, he or she would do so. It is because judges have the power under the IPP sentence to deliver indeterminate sentences to protect the public that they deliver those sentences. I am afraid that the Justice Secretary is not right.
A critical weapon will be absent from a judge’s arsenal, preventing that judge from handing down the most appropriate sentence. The judge will simply not be able to sentence the offender with the condition that only when the authorities are satisfied that he is not a risk to society will he be released. I know that that will free up prison places and save the Government money, but taking risks with public safety is plain wrong, which is why we will oppose new clause 30.
Public safety will also be compromised by the proposed “two strikes and you’re out” sentences. That is a great media soundbite and a sure-fire way of making the Government seem tougher than they really are, and it is precisely the kind of thinking that lies behind the inclusion of the words “punishment of offenders” in the Bill, but policies relating to public safety cannot be determined by a public relations strategy.
We do not have to scratch very far beneath the surface to see that the Government’s plans are riddled with problems. Not only are they a rehash of failed Conservative policy from the 1990s, but they introduce a worrying amount of risk—risk that will undermine public safety. Through their “two strikes” policy, the Government absolve themselves totally of any responsibility to identify the serious, violent offenders who are most likely to reoffend. That should be done at the time when the first sentence is handed down for the commission of a heinous crime. It was for the purposes of precisely this scenario that the previous Government created indeterminate sentences, but this Government are making no effort to protect the public from those who are most likely to commit further serious and violent crime following their release. They will address the problem only once the offender has committed a second crime.
Mr Graham Stuart (Beverley and Holderness) (Con)
The right hon. Gentleman has cited cases, and appalling cases at that, in which he feels that an indeterminate sentence is appropriate. Can he give any examples of cases in which he thinks that an indeterminate sentence has not led to justice—in which people have been locked up for many years, perhaps longer than they should have been?
Sadiq Khan
I shall come to the challenges posed by IPP sentencing. I accept that criticisms could be made about cases of people who should perhaps have been released and have not been. The hon. Gentleman has made a fair point. However, I do not think that the Government should risk the possibility that their policy will create countless additional victims, pain and misery that could be prevented if they took seriously their responsibility to keep the public safe. It should also be noted that the threshold for the handing down of a mandatory life sentence for the second offence is higher than that required for an indeterminate sentence. As a result, there is a risk that some of the most dangerous and serious criminals will not even be covered by the “two strikes” proposals. All that points to the need for some kind of indeterminate sentence that judges could use only in the most serious circumstances.
The 2008 reforms helped to deal with some of the problems that were inherent in the Criminal Justice Act 2003, and I pay tribute, as did the Justice Secretary, to the work of my right hon. Friend the Member for Blackburn (Mr Straw) for the work that he did at that time. If the Government think that further reform is required, they can take many positive lessons from Northern Ireland’s successful introduction of indeterminate custodial sentences. I know that the Justice Secretary has corresponded with Northern Ireland colleagues, and has had discussions with my right hon. Friends the Members for Wythenshawe and Sale East (Paul Goggins) and for Sheffield, Brightside and Hillsborough (Mr Blunkett) on this very matter. He has said nothing, however, about why he believes the Northern Ireland experience does not contain lessons for England and Wales; instead, he simply dismissed that possibility out of hand.
Philip Davies
Unlike the Front Benchers, I will try to keep my speech brief so as to allow other Members to contribute.
The Government are making a serious mistake by getting rid of indeterminate sentences, and I believe the decision will come back to bite them on the bottom. The vast majority of people serving indeterminate sentences have committed crimes such as manslaughter, other homicide and attempted homicide, other violence against the person, rape, other sexual offences, robbery and arson. Why on earth would we want a Government who think it is perfectly acceptable to let those people out of prison before they are deemed safe to be released out among the public?
Philip Davies
The shadow Secretary of State has hit the nail on the head. The Secretary of State started off in his post by saying that the most important thing for him was reducing reoffending. Well, we are talking about the crown jewel in the criminal justice system for dealing with reoffending. [Interruption.] I know that the Liberal Democrats do not believe that—they are soft on crime so I would not expect them to accept it. By the end of last year, 206 people who had served indeterminate sentences had been released from prison and 30% of them had committed more than 15 previous offences. Many of these people were not just dangerous offenders, but persistent offenders. How many of those 206 had committed another offence by the end of last year? The answer is just 11, or about 5%. The Secretary of State would give his right arm for reoffending rates of that order across the criminal justice system, so why on earth does someone who is supposedly committed to reducing the reoffending rate want to scrap the best-performing part of the criminal justice system on reoffending? This beggars belief. It comes back to the point that his real motive is not about reducing reoffending or protecting the public; it is about reducing the prison population. That is the only thing that he has ever been interested in, and this measure is all the proof we ever needed that that is his only motivation. It is absolutely appalling that a Government supposedly dominated by the Conservative party—the party of law and order—could be letting dangerous offenders out of prison before they are deemed safe to be released.
I wish to give a couple of examples of the people we are talking about from my local area of Bradford. Toffozul Ali was a convicted killer who was locked up indefinitely for a sudden and sustained knife attack in Bradford. Ali shook hands with his victim, Darren Jones, before stabbing him from behind, causing wounds to his arm, chest and knee. Ali already had a conviction for manslaughter for stabbing an Asian man to death when he was only 16, and he was branded a public danger and sentenced to an IPP. This Government seem to think it is fine that he can be released from prison before he is deemed safe to be released from prison—it is an absolute disgrace. Martin Ellerton was locked up indefinitely for stabbing his father to death, and he confessed to a six-year crime spree involving more than 630 offences of burglary and theft. These are the types of people we are talking about. The Secretary of State seems more concerned with their rights than with those of the people in places such as Shipley, who want to be protected from these people.
Stephen Ayre was a convicted killer who abducted and raped a 10-year-old boy in my constituency when he was unnecessarily released from prison. The father of that boy has gone through the trauma of that to call publicly for the Secretary of State to rethink his proposals on indeterminate sentences, saying:
“I would not wish what we’ve been through on anyone. The system failed my son six years ago. But Ken Clarke’s changes will only make things worse.”
I guarantee that people will be released from prison who otherwise would not have been and I guarantee that those people will go on to commit serious offences. What will the people who voted for this measure think about that, given that they will have created unnecessary victims of crime?
Sadiq Khan
Does the hon. Gentleman realise that the new proposals mean that it is possible for somebody to receive an extended determinate sentence, to go on no courses or programmes, to sit in their cell for the duration of the sentence and still be released at the end of their determinate sentence?
Philip Davies
I have a lot of sympathy with what the shadow Secretary of State says. The point is that, at the moment, these people are released only when they are deemed safe to be released. Under a determinate sentence—irrespective of whether or not people are safe to be released, whether or not they have gone through the programmes they need to go through to address their offending behaviour and whether or not they have behaved well in prison—they will be released back out to the public. That is an absolute disgrace, as is debating this issue in just 73 minutes, with 30 minutes for speeches by Back Benchers. I will give up at that point to make room for other people, but the Secretary of State should be ashamed of himself as this will measure create further unnecessary victims of crime.
Kate Green (Stretford and Urmston) (Lab)
I apologise for diverting the House to a rather different part of the debate, but my new clause 3, which I am pleased has support from Members across the House, is extremely important to a group of victims and their families—those for whom disability has been the motivation for murder or other violent crimes against disabled people. My new clause would apply the same minimum tariff in cases of murder in which disability has been a motivating factor as currently applies in similar cases with a sexual, racial or religious motivation. It would also shift the application of the aggravating feature of disability from being a matter of the victim being seen as vulnerable to a matter of the victim being at greater risk of harm, thereby firmly placing the obligation on the perpetrator.
Paul Maynard (Blackpool North and Cleveleys) (Con)
I am delighted to support this new clause. Does the hon. Lady agree that although this might seem like an obtuse issue to hon. Members in the Chamber it is attracting great attention outside within the disabled community? Does she also agree that there will be utter incomprehension if we fail to make progress on this issue, which should be a simple matter of human dignity and equality?
Kate Green
The hon. Gentleman is absolutely right and he has raised this issue in the House and with the Lord Chancellor before. Many disability organisations and the families of victims of such crimes have contacted him and me to express their very deep concerns. I am particularly indebted to the Disability Hate Crime network, to Katherine Quarmby, an independent journalist, and to the Royal Association for Disability Rights. I am also especially indebted to Christine Oliver, the sister of Keith Philpott, who was a learning disabled victim of murder, for taking the time to talk to me about her family’s experience in relation to my bringing the new clause before the House.
Mr Kenneth Clarke
I am sorry to intervene but, for the benefit of the debate on the other subject, may I assure the hon. Lady on behalf of the Government that we agree with her and my hon. Friend the Member for Blackpool North and Cleveleys (Paul Maynard)? I am advised that the new clause is defective in its drafting—I can tell her why—and I can assure her that we will table amendments in the other House to give effect to what she is asking for. We also propose to cover the transgender issue. I think that will help us to get on with the debate.
Kate Green
I am extremely grateful to the Lord Chancellor, as will be the many disabled people and their families who have been in contact with me. I am delighted that a Government amendment will be brought forward in the other place and I shall not detain the House further.
Sir Alan Beith
The hon. Member for Stretford and Urmston (Kate Green) must be delighted that so brief and concise a speech has produced so immediate, thorough and satisfactory a response. I welcome what the Government are doing about this.
I want to be brief so I shall resist the temptation to go into the extraordinary intellectual journey that the right hon. Member for Tooting (Sadiq Khan) seems to have undertaken. I shall also resist the temptation to go into the habit of the previous Government of releasing people from prison at any moment when the jails seemed to be rather full without any reference to sentence planning or, for that matter, to the annual criminal justice Bill to which new clauses were always added on Report as far as I can recall—a practice I rather deplore because, as in this case, it denies us the opportunity to give new clauses proper scrutiny. I want to make it quite clear that the continuance of what I regard as a blot on the system—the use of indeterminate sentences—is something that I do not support. I therefore welcome the Lord Chancellor’s action to remove such sentences from our system, and I believe that view is widely shared in the criminal justice system.
People are concerned about the possibility of serious criminals re-entering society and committing other very serious offences, but how can they conclude that the best thing to do with such people is to put them in prison without our having any idea how long they might stay there? Surely, it is better to have a much clearer idea that they will be in prison for a long time and that if they are ever released, it will be under licence for life. I do not see why it should be preferable for the public to be told, “Well, we’ve put the chap in prison, but we’re not really sure when he’ll come out and a board that you know very little about will decide whether it’s safe.” I think most members of the public would be quite suspicious of that and would rather hear that there was a clear and long sentence. I am suspicious of mandatory sentences, but as a means of giving reassurance on how the courts might be expected to behave in the sort of cases we are discussing, the mandatory sentence we are discussing can be justified, especially as it is very carefully worded with appropriate provision for justice.
However, all this is only part of the story. None of it is any use unless we have proper sentence planning and proper offender management. Proper sentence planning is virtually impossible under the indeterminate sentences for public protection system, especially for those on shorter terms. People have not been completing the courses that they need to have completed to satisfy the Parole Board that they could be released. That system is untenable. We need effective sentence planning—and more determinate sentences are a better way of achieving that. We need proper offender management for offenders who are eventually going to leave prison. The Justice Committee has regularly stressed that the concept of offender management needs to include proper control. It should not be a system in which people are handed from one agency to another without a continuous process of supervision.
The trouble with the procedure in the new clause is that we do not have the opportunity to probe the details by tabling a probing amendment. I asked the Lord Chancellor earlier about new clause 34. I think that it is well intentioned in that it is an attempt to deal with existing indeterminate public protection prisoners, but I am bound to question it because it gives to the Executive the power to direct the Parole Board on what should be done with an individual. That is a direction to a court—there have been court cases that have ruled that the Parole Board must be regarded as a court. So it is an odd way of proceeding and one that we might have amended in Committee had we been able to consider the measure. If there is an opportunity, I hope that I can hear a little more about why the measure has been introduced as a new clause tonight.
Mr Straw
I endorse the remarks of my right hon. Friend the Member for Tooting (Sadiq Khan) and the hon. Member for Shipley (Philip Davies). The hon. Member for Shipley, addressing the Lord Chancellor and his hon. Friends, said that the measure would lead to a number of dangerous offenders coming out of prison before it was correct to let them out. That, of course, is one of the key drivers of this policy. It is not about prison reform. The whole purpose of the measures put before the House last December was to cut the prison population by 6,500. The Lord Chancellor then ran into huge difficulties because he could not get his own side, our side or the judges to accept the 50% tariff for an early guilty plea and many other changes. I do not know the number exactly, but I do know that The Times quoted a Ministry of Justice spokesperson last Friday as saying that the changes would lead to a cut in the prison population of 2,500.
The Secretary of State seemed to want to have it both ways. He damned the concept of the indeterminate sentence for public protection and suggested that it was a stain on the system. He also tried to reassure the House and the public by saying, “Don’t worry, we are going to do exactly the same thing, but it is going to be called a mandatory life sentence.”
Mr Kenneth Clarke
May I correct the right hon. Gentleman? The impact statement will show the Bill as amended. Other things being equal, with no changes in the crime level—which depends far more on how long a recession we have, the levels of youth unemployment, how successful we are in dealing with drugs and how far we get with prison reform—the Bill will reduce the prison population by 2,300. The measure we are now debating will have no effect on the prison population in the period to 2015. The reduction in the prison population is achieved by measures already discussed and approved in the Public Bill Committee.
Mr Straw
It would have been helpful to have the impact statement before the House today rather than tomorrow. If the right hon. and learned Gentleman is saying—picking up the point made by the hon. Member for Shipley—that no prisoner who cannot be released until he has proved that he is not a danger to the public will not be released in the future, what on earth are these convoluted changes for?
The original design of the legislation in 2003 was unsatisfactory because it led in some cases to tariffs that were ludicrously short—in one case, 27 days. That was never the intention of my right hon. Friend the Member for Sheffield, Brightside and Hillsborough (Mr Blunkett) and it was causing a major problem. I, with the approval of the House, sought to change the law. It is worth Government Members remembering, as my right hon. Friend the Member for Tooting pointed out, that we got no assistance whatever from the Conservative Opposition at the time. Their complaint was that we were going soft by introducing this change. It was absolutely extraordinary. I do not remember the right hon. and learned Member for Rushcliffe (Mr Clarke), now the Lord Chancellor, standing up either in the House or outside suggesting that there was an alternative. We made that change and, interestingly and wholly contrary to what was said, it has led to a stabilisation of the numbers on indeterminate public protection sentences. According to the Lord Chancellor’s statistical bulletin, in the most recent year the number of such sentences rose by only 3% over the previous year and the number of those receiving IPP sentences was 958 for the year ending March 2011, compared to one short of 1,000 for the year ending March 2010. The changes that were introduced are working.
Yes, it is right that we should look in more detail at the Northern Ireland experience to see what other changes can be made, but it is entirely wrong for the Secretary of State to try to set up a new system that will lead either to the release of dangerous people who are serious and persistent offenders, thousands of whom are in prison for violent offences and sexual offences—in the main—or make no difference at all.
Mr Geoffrey Cox (Torridge and West Devon) (Con)
Will the right hon. Gentleman give way?
Mr Straw
If the hon. and learned Gentleman will excuse me, I will not.
The Lord Chancellor has been anxious to please the whole prison reform lobby—people who, bluntly, do not speak for the public, and rarely speak for the victims either in my experience, but even they will not be satisfied. Meanwhile, the public and innocent victims will be put at risk.
Mr Deputy Speaker (Mr Lindsay Hoyle)
Order. May we have brevity? We want to hear as many speakers as possible.
Guy Opperman (Hexham) (Con)
I declare an interest as a former barrister and a former criminal prosecutor, who has worked on several murder trials.
I assure my hon. Friend the Member for Shipley (Philip Davies) that I am not soft on crime, but I support the Government in their reform of this untenable, shocking and wrong system. With great respect to the right hon. Member for Blackburn (Mr Straw), he should hang his head in shame for being party to the Criminal Justice Act 2003 and the Criminal Justice and Immigration Act 2008, both of which were useless pieces of legislation that introduced something that the Prison Reform Trust, the Institute for Criminal Policy Research, the Nuffield Foundation and the criminal justice joint inspectorate described as
“one of the least carefully planned and implemented pieces of legislation in the history of British sentencing.”
The flip-flops of the shadow Justice Secretary would put a kangaroo to shame. It is entirely right to reform a system that was underfunded, worked poorly and is manifestly wrong in the circumstances of a 21st-century country. I will speak only briefly but I remind the right hon. Member for Blackburn of the comments in the House of Lords on the 2003 and 2008 Acts, when the Lords addressed IPPs in the cases of the Crown v. James and the Crown v. Lee. In a decision that effectively lambasted the then Secretary of State, Lord Hope of Craighead said:
“There is no doubt that the Secretary of State failed deplorably in the public law duty…He failed to provide the systems and resources that prisoners serving those sentences needed to demonstrate to the Parole Board by the time of the expiry of their tariff periods…that it was no longer necessary for the protection of the public that they should remain in detention.”
I could go on to quote from the judgments of Lord Carswell and Lord Brown of Eaton-under-Heywood, but I shall pause there.
I have made it clear that I am not soft on crime, as others have suggested. The debate has sadly been too short, but the new clause should certainly be supported by the House.
Paul Goggins (Wythenshawe and Sale East) (Lab)
I share the concerns expressed by hon. and right hon. Members on both sides of the House, but I am grateful to the Lord Chancellor for the meeting he and his ministerial colleague held with my right hon. Friend the Member for Sheffield, Brightside and Hillsborough (Mr Blunkett) and I. I am also grateful for the Lord Chancellor’s assurance earlier that he would still be thinking hard about the provisions as they go from this place to the House of Lords.
I want again to assert briefly that the Northern Ireland experience was instructive, and if the Lord Chancellor was prepared to reflect on it, it would strengthen the flawed prospectus he has given us. The experience in Northern Ireland was based on a tragic case involving Trevor Hamilton, who murdered Attracta Harron when she was on her way home from mass in December 2003. My right hon. Friend the Member for Delyn (Mr Hanson) remembers the case well because he dealt with the issues too. Hamilton had been released at the halfway point of a seven-year sentence for rape, indecent assault and threats to kill. The public were outraged that such a dangerous individual could be released with no control whatever by the public authorities.
The framework in Northern Ireland is based on two key principles. The first is absolute judicial discretion, with no presumptions about previous offences, such as there were in the 2003 Act—so complete judicial discretion. Secondly, judges have to go through a very clear process. Does the offence justify a life sentence? If it does, that is what the offender gets. If it does not, the judge must consider an extended sentence, which can give some degree of control over the release date, but the offender must eventually be released at the end of the extended custodial period. If that is not sufficient for public protection, only then can the judge give an indeterminate sentence.
The result is instructive. The Northern Ireland Justice Minister, David Ford, has sent us a report, for which I commend him—the report should be put in the Library. There has been no significant change in the number of life sentence prisoners. There have been 68 extended sentences and eight indeterminate sentences in three and a half years. That system is in control and it offers the public protection.
There are real risks with what the Lord Chancellor is proposing. If he is right and judges suddenly start to impose more life sentences, he will simply have replaced one problem with what he described as the original problem. He will have replaced indeterminate sentences with life sentences, which will bring all the issues relating to resources and parole that he faces currently. The most serious thing is that under his proposals all dangerous offenders not given a life sentence will have a definite date for release, which is a risk too far for this or any Government to take. It will leave a gap, bridged in Northern Ireland by the indeterminate sentence not as a first or a second option but as a complementary third option.
I am glad that the Lord Chancellor is listening. I hope he heeds that lesson and that when he takes his legislation to the other place he will make further amendments.
Mr Elfyn Llwyd (Dwyfor Meirionnydd) (PC)
I am in favour of the Government’s decision to scrap IPP sentences in this instance. Liberty, among others, has said that IPPs could be a back-door measure to introduce life sentences for a huge range of offences. They were intended to be given only sparingly but of course they have been used far more frequently than expected. In March 2011, there were 6,550 IPP prisoners, half of whom served 240 days beyond their tariff, at a cost to the Exchequer of about £68 million. That is quite apart from the whole question of whether they were being held unlawfully, which worries many of us.
As it stands, the IPP regime has been a costly mistake. Furthermore, the indefinite legal limbo created by IPP sentences has in many instances undermined rehabilitation, leaving prisoners and their families uncertain when, if ever, release will be granted. Like the Lord Chancellor, I wonder why those sentences have not been challenged in the courts. I have campaigned on the matter for a long time. In February, I introduced a ten-minute rule Bill seeking the abolition of IPP sentences, so I am pleased about the Government’s decision.
New clause 32 would mean that prisoners serving an extended sentence of at least four years in custody, who have a prior conviction for one in a list of serious offences, will be required to serve two thirds of their sentence, instead of being considered for release at the halfway point. I argued for such a provision when I introduced my Bill, so I am pleased that it has been introduced. However, like the right hon. Member for Berwick-upon-Tweed (Sir Alan Beith), I have concerns about new clause 34. I have grave concerns about interference in individual parole decisions. That proposal must be looked at in the other place. We do not have time to debate it properly today and I am sure that many Members, whatever their views, would have appreciated a sensible timetable.
Mr Kenneth Clarke
I shall correspond with the right hon. Gentleman and the right hon. Member for Berwick-upon-Tweed (Sir Alan Beith). The new clause was tabled at my request so that we can contemplate changing the test for release by statutory instrument. I shall explore whether it gives rise to the problems described. I certainly have no intention at the moment of intervening in individual cases and making judgments about IPP prisoners.
Mr Llwyd
That is certainly reassuring, but had we had a decent amount of time to discuss the proposals we could have probed them earlier. There is also some confusion about new clause 33, which will no doubt be picked up in the other place.
I know that I have done nothing for my street credibility, and even less for the Lord Chancellor’s, but I believe that the IPP system has been brought into disrepute. It is only right that we do away with it, and to that extent I agree with what the Government seek to do.
Mr Robert Buckland (South Swindon) (Con)
I shall be brief. I support the Government’s amendments. We need a system that does not try to predict risk, but sentences according to the seriousness of the offence. The right hon. Member for Wythenshawe and Sale East (Paul Goggins) made some very interesting points that deserve consideration, but now is the time for change. The current system is not sustainable. We are not dealing with the risk that these people pose and a system of determinate long sentences would be a far better service to the victims of crime, who are too often left in the dark about what happens in cases—
The Parliamentary Under-Secretary of State for Justice (Mr Jonathan Djanogly)
I beg to move, That the clause be read a Second time.
Mr Deputy Speaker (Mr Lindsay Hoyle)
With this it will be convenient to discuss the following: Amendment (a), after first ‘paid’ in (1)(a), insert
‘will be paid, has made an agreement to be paid,’.
Amendment (b), after ‘pays’ in (1)(b), insert
‘will pay, has made an agreement to pay’.
Amendment (c), after first ‘paid’ in (2)(b), insert
‘will be paid, has made an agreement to be paid,’.
Amendment (e), at end of (4)(b), insert—
‘(2A) A breach of the provisions of this section shall be an offence, punishable on summary conviction by a fine not exceeding the statutory maximum or on indictment for a term of imprisonment not exceeding two years, or a fine, or both.’.
Government new clause 19—Effect of the rules against referral fees—
‘(1) The relevant regulator must ensure that it has appropriate arrangements for monitoring and enforcing the restrictions imposed on regulated persons by section [Rules against referral fees].
(2) A regulator may make rules for the purposes of subsection (1).
(3) The rules may in particular provide for the relevant regulator to exercise in relation to anything done in breach of that section any powers (subject to subsections (5) and (6)) that the regulator would have in relation to anything done by the regulated person in breach of another restriction.
(4) Where the relevant regulator is the Financial Services Authority, section [Regulation by the FSA] applies instead of subsections (1) to (3) (and (7) to (9)).
(5) A breach of section [Rules against referral fees]—
(a) does not make a person guilty of an offence, and
(b) does not give rise to a right of action for breach of statutory duty.
(6) A breach of section [Rules against referral fees] does not make anything void or unenforceable, but a contract to make or pay for a referral or arrangement in breach of that section is unenforceable.
(7) Subsection (8) applies in a case where—
(a) a referral of prescribed legal business has been made by or to a regulated person, or
(b) a regulated person has made an arrangement as mentioned in section [Rules against referral fees](2)(a),
and it appears to the regulator that a payment made to or by the regulated person may be a payment for the referral or for making the arrangement (a “referral fee”).
(8) Rules under subsection (2) may provide for the payment to be treated as a referral fee unless the regulated person shows that the payment was made—
(a) as consideration for the provision of services, or
(b) for another reason,
and not as a referral fee.
(9) For the purposes of provision made by virtue of subsection (8) a payment that would otherwise be regarded as consideration for the provision of services of any description may be treated as a referral fee if it exceeds the amount specified in relation to services of that description in regulations made by the Lord Chancellor.’.
Amendment (a) to new clause 19, leave out subsection 5.
Amendment (b), leave out from ‘services’ in (8)(a) to end of paragraph (b) and insert
‘but only where the consideration was proportionate and reasonable in the circumstances.’.
Government new clause 20—Regulation by the FSA.
Government new clause 21—Regulators and regulated persons.
Government new clause 22—Referral fees: regulations.
Government amendment 139.
Mr Djanogly
New clauses 18 to 22 seek to prohibit the payment and receipt of referral fees in personal injury cases by regulated persons, namely solicitors, barristers, claim management companies and insurers.
I pay tribute at the outset to the work of the right hon. Member for Blackburn (Mr Straw) in pursuing the case for a ban on referral fees. I know that there are some differences between us about the detail of how we should implement the ban—we will come to his amendments in due course—but those differences of detail should not obscure our agreement in principle on tackling this important issue. I acknowledge his efforts in this regard.
I must also mention the consistent campaign by the right hon. Member for Berwick-upon-Tweed (Sir Alan Beith) as Chair of the Justice Committee, who has also been a very keen supporter of the ban. I note that last week his Committee formally welcomed our commitment to the ban, which will be implemented by these clauses. I should also acknowledge the work of the Transport Committee, chaired by the hon. Member for Liverpool, Riverside (Mrs Ellman), before whom I was privileged to appear last month.
My right hon. and learned Friend the Secretary of State for Justice announced the Government’s intention to ban the payment and receipt of referral fees in personal injury cases by way of a written ministerial statement to the House on 9 September 2011.
I strongly believe that the current arrangements under which lawyers and others are able to pay and receive fees for referring work have led to both higher costs and the growth of an industry that pursues claimants for profit. By introducing the new clause, the Government are taking decisive and much needed action to remove these incentives.
Right hon. and hon. Members will be aware that Lord Justice Jackson recommended that referral fees should be banned as part of his comprehensive package of recommendations to make the costs of the civil litigation more proportionate and this recommendation was echoed by Lord Young in his report “Common Sense Common Safety”. The Bill already includes provisions to implement the other key elements of those recommendations. The referral fees ban under our new clause will complement the wider Jackson reform already in the Bill by further reducing the costs of personal injury litigation and deterring frivolous or unnecessary claims from being pursued in the courts.
The new clause creates a regulatory offence for any breach of the prohibition. It will be for the appropriate regulators, for example the Law Society, the Financial Services Authority or the claims management regulator, to enforce the prohibition. The regulators will also be responsible for taking appropriate action against regulated persons for any breaches. We have thought carefully about how to ensure that all the main players, including insurers, are captured by the ban, which is why there is a separate clause, new clause 20, giving the Treasury powers to make regulations allowing the FSA to enforce the ban under its existing regulatory powers.
There have been calls from some people, but not most people, for the payment and receipt of referral fees to be made a criminal offence. Not least among those who have called for that is the right hon. Member for Blackburn, who has tabled amendment (e) to that effect. We considered the matter carefully but believe that creating a criminal offence would be a very blunt instrument in this case. One would have to prove beyond reasonable doubt that consideration had changed hands for the referral of a potential claimant, but the grounds for determining whether something was or was not a referral fee could be blurred. It would be very difficult to convict in many cases on the basis of the complexity of those arrangements. That is why we consider a regulatory offence to be more appropriate, whereby the principle of what is happening can be looked at by the regulator and a view can be taken.
I am conscious that a criminal offence would impose additional costs on the police and the courts in investigating and enforcing a ban. I believe that a regulatory prohibition covering all the main players in the sector, including lawyers, claims management companies and insurers, is the most appropriate and effective response to the issue. I am confident that the industry regulators are best placed to investigate and enforce the regulatory ban.
Sir Alan Beith
As my hon. Friend has indicated, I strongly support the action he is taking, but is it not the case that in many of those circumstances a criminal offence may well have been committed by way of a breach of the Data Protection Act 1998? The problem then is that custodial sentences are not available for someone who is doing that on a large scale and making a great deal of money by releasing personal information and committing a criminal offence.
Mr Djanogly
My right hon. Friend makes a good point. It is not one that is covered by the Bill, but it is something that the Government are looking into, and I hope that there will be further developments on that in due course.
Mr Straw
I thank the Minister for the generous compliment he paid me, for which I am most grateful. There are plenty of situations relating to financial institutions in the widest sense when conduct might be the subject of a regulatory breach enforced by the regulators, but in more severe cases it could also be a criminal offence. It is a matter of belt and braces. Frankly, I do not understand why he is suggesting that those are alternatives when one complements the other.
Mr Djanogly
The reason is that criminalisation would be too blunt an instrument. If we take the example of the straight payment of a fee for a referral, I can see how straight criminalisation would work, but we should appreciate that when that was last banned in 2004 it was a weak provision through which a coach and horses could be driven. What if an insurance company provides insurance to a solicitor in payment for referrals, rather than a straight fee? What if a trade union gives its cheap work to a firm of solicitors in consideration for the solicitors getting its better work? What if a claims management company provides a variety of services to a solicitor in payment for a referral? The point I am making is that the circumstances could be very varied and complex and the straight criminal option would not be appropriate. It would be the principle that counts and it would have to be a regulator that looks to the principle.
We are primarily concerned with removing incentives under the current system with regard to personal injury claims, which is why we are banning referral fees in that area. However, the Lord Chancellor may in future extend by regulation the prohibition on referral fees to other types of claim and legal services and other providers of legal services should the need arise and if the case is made for such an extension.
Kate Green
Is the Minister not concerned that that might introduce an element of uncertainty? Although I note what he says about the possibility of extending the provisions to other structures in future, is he not aware that alternative business structures will now be set up by large companies to get around the provisions? How will he address that?
Mr Djanogly
Alternative business structures will be set up by the Solicitors Regulation Authority, probably before or just after the end of this year, so the hon. Lady makes an important point. At that stage, claims management companies will be able to purchase solicitors, and vice versa, which means that it would indeed be possible, as we discussed in the Transport Committee, for a claims management company to own a solicitor and effectively act as the advertising arm of a firm of solicitors. However, the important difference is that the claims management companies will then be regulated by the SRA, which will give consumers a significant amount of comfort.
Referral fees are one of the symptoms of the compensation culture in this country. The Government are determined to put an end to them while at the same time addressing the underlying cause of recoverability of no win, no fee success fees.
Mr Andy Slaughter (Hammersmith) (Lab)
Following what my right hon. Friend the shadow Secretary of State for Justice said earlier this afternoon, I rise to discuss proposals that have not been given due scrutiny in Parliament. We are all aware that the Government were bounced into taking action on referral fees only by the sustained campaigning by my right hon. Friend the Member for Blackburn (Mr Straw). In their haste to cover up their inaction and disregard of the abuses of the insurance industry, they have failed to consult on their proposals, which are incompetent, ineffective and will lead to problems further down the line. Indeed, it was reported this week that a judicial review has already been launched citing that lack of consultation.
Referral fees are paid by one party to another in exchange for what are essentially sale leads. They are analogous to brokers’ fees, commission for salespeople, marketing agreements or, in the most basic sense, advertising, because each of these represents part of the cost of sales. Every non-monopolistic industry has a cost of sales. Let me take the example of the insurance industry, an industry with which the Minister has more than a passing familiarity. Admiral is the UK’s leading specialist motor insurance company. Last year it received net insurance premium revenue of £288 million, but its total net revenue was £639 million, part of which was made with referral fees. It spent £151 million on the acquisition of insurance contracts and other marketing costs, including brokers’ costs, paying insurance websites and expensive advertising. Those costs drive up premium costs and the desire to make profit also drives up premium prices—Admiral made £283 million in profit last year on its net revenue of £639 million. That is how it works in the insurance industry.
It works in a similar way when law firms pay independent brokers, some of which are known as claims management companies, another area with which the Minister has more than a passing familiarity. They will pay referral fees in order to get leads for their practice. The lawyers often do this because, frankly, they are not very good at sales, marketing or advertising. However, the problems arise in the behaviour that that encourages. Although there are reputable and decent claims management companies out there that bring together those who want help with those who can provide it, there are also many claims farmers, often based overseas, that abuse the system, send unsolicited spam to people’s e-mail accounts and mobile phones and abuse their data.
It is right to deal with people who act in such a way, but the claims management regulator, which until a few weeks ago was the Minister, but which I understand is now the Secretary of State, has proven singularly unable to do so. An internal review of claims management regulation from the Ministry of Justice, dated 25 October 2011—just last week—states:
“It is evident that many of the more objectionable practices of Claims Management Companies such as cold calling in person, unauthorised marketing in hospitals and using exaggerated marketing claims have been reined in as a result of action taken under CMR.”
Nothing could make clearer what delusions have set in with claims management regulated by the Minister, because we all know from personal experience that the opposite is true and that such abuse is still out there at large and, if anything, is increasing. Our constituents are harassed by claims farmers, and their objectionable messages, but the Department that he has mismanaged for the past year and a half believes it is doing an excellent job. That is why we must take corrective action.
Mr Kevan Jones (North Durham) (Lab)
I note what my hon. Friend is saying about the claims regulatory authority, but my experience at the tail end of the miners compensation scheme was that it was effective in driving out of the industry some of the more unscrupulous claims management companies, which were often just front companies that wound up as soon as they had passed the claims on. I caution my hon. Friend not to be too harsh on it.
Mr Slaughter
I am grateful for my hon. Friend’s intervention. I am sure that some companies have been driven out of business, but the everyday experience of hon. Members, and certainly of our constituents, is that the industry is not properly regulated, which is why corrective action must be taken. However, the proposals in the Government’s new clauses are, I fear, insufficient. They are riddled with inconsistencies and loopholes, which is another symptom of the haste with which they were prepared.
I will deal with the point that the Minister dealt with. New clause 19(8) states that a payment is
“to be treated as a referral fee unless”
it can be shown
“that the payment was made…as consideration for the provision of services, or…for another reason”.
The Minister’s impact assessment explains what that means. Claims management companies may adapt their business models so that they are not reliant on referral fees paid by lawyers, or they may move into alternative types of business such as marketing or advertising. That is staggering to those of us who recognise that it is precisely that marketing and advertising, whether on daytime TV adverts or via spam messages, that lead to perceptions of a compensation culture.
What is the point of the new clauses? The truth is that they are an afterthought to a package of changes in the Bill, some of which we will debate tomorrow, that have far more bite but a different purpose. The changes to conditional fee agreements mean that losing defendants—wrongdoers—and their insurers will benefit at the expense of winning claimants—victims—and that is the real objective of the Government’s legislation. Tomorrow, we will seek to overturn those provisions.
As Bob and Sally Dowler have told us; as the lawyers that brought Trafigura to justice have told us; as victims of asbestosis, who have been fighting insurers that simply do not want to pay out to hard-working and long-suffering people; as those who have been unfairly dismissed or subject to harassment in the workplace have told us; and as Christopher Jeffries, who was persecuted by the media last Christmas, as he wrote in The Guardian this very day, has told us, the changes are unacceptable. The Government’s proposed changes, which they had thought about and on which they had taken instructions from the insurance industry, are in the Bill, but very little thought has gone into the new clauses before us today, and none would have gone into them had it not been for my right hon. Friend the Member for Blackburn.
In summary, we believe that there is merit in a ban on referral fees as part of a package to stop the abuses that I have talked about. That is why I tabled amendments not just to clamp down on those fees, but to make the payment and solicitation of referral fees in road traffic accident personal injury cases a criminal offence. My right hon. Friend has tabled amendments to new clause 18, and I hope that he will press them to a vote. If he does so, I hope that hon. Members on both sides of the House will join him in the Lobby if the Government still refuse to accept the criminalisation of referral fees.
We sought to make unsolicited text messages and phone calls regarding personal injuries a criminal offence. We would have strengthened the rules against the sale of personal data. We would have restricted whiplash claims by placing a lower limit on the speed at which a vehicle must be travelling before damages may be paid. We would have outlawed third-party capture, another dirty secret of the insurance industry. I freely acknowledge that we plagiarised some of that from my right hon. Friend’s private Member’s Bill.
If the Government had had the courage of the conviction in the Minister’s speeches earlier in the year, we would have got to the heart of the perception of a compensation culture. In doing so, we would have done what the Government are now failing to do. The new clause alone will have little effect. We believe that it deserves further scrutiny, and we hope that amendments in another place will toughen it up, if that does not happen tonight. We also hope that amendments to make these practices criminal offences will be accepted. We therefore have no intention of voting against the new clauses; we simply regard them as not going far enough.
The Minister’s incompetence in getting to grips with claims farmers who engage in unscrupulous practices and his Department’s failure even to recognise the scale of their failure to regulate effectively have got us here. These are symptoms not of a litigation culture, as he would have us believe, and of the rhetoric that goes along with the cuts in legal aid to the poorest, as well the neutering of no win, no fee agreements which will affect almost everyone except the super-rich and will prevent access to justice, but of regulatory incompetence by the Minister’s Department. Indeed, he has now surrendered responsibility for that regulation.
I commend my right hon. Friend’s amendments to the House. We accept the new clauses as far as they go, but it is about time the Government stopped using their rhetoric as a mask for preventing victims from obtaining justice and used it to ensure that the abuses that we all put up with day to day from fraudulent and criminal practices are stamped out.
Tom Brake (Carshalton and Wallington) (LD)
I shall be brief. I welcome the Government’s action to address referral fees. There is no doubt that consumers have paid a significant price. I hope that we can clamp down heavily on other things, such as unsolicited text messages and spam, which we have all experienced, through other measures such as those on data protection.
I would like the Minister to deal with just one point. The industry has been pressing for these changes, and consumers in particular want to understand what guarantees, if any, they will have that when the changes have taken effect they will see a difference in the prices they pay for services.
Mr Straw
As a preliminary, I wish to draw the House’s attention to the fact that against my name on the amendments relating to referral fees there is an R, which indicates that I have a declarable interest. It arises from three engagements that I undertook for fees on matters relating to referral fees and the motor insurance industry generally. They were on 28 September, 12 October, and earlier today. In respect of the first two, I have made a declaration to the Registrar of Members’ Financial Interests, who told me that because I have not yet received payment, the time for these is not yet running. The declaration for my engagement this morning will be made tomorrow.
I tabled amendments to new clauses 18 and 19 and, as my hon. Friend the Member for Hammersmith (Mr Slaughter) indicated, in the absence of a sudden Pauline conversion from the Government Front Bench between now and when the question is put, I shall press amendment (e) to new clause 18 to a vote.
According to the AA, over the year to March 2011, there has been a 40% increase in motor insurance premiums. In many areas of the country, mine included, although it is by no means the worst, the increase has been even higher. As a number of colleagues of all parties have pointed out, that has very severe social consequences.
May I say that I am extremely grateful for the wide support that my Motor Insurance Regulation Bill has had throughout the Chamber? Motor insurance is the only insurance affecting an individual that is compulsory, and in certain areas and for certain categories, particularly younger drivers, premiums are now so high as to place motor insurance out of reach altogether. A driving licence is often a necessary qualification for taking a job. In any case, people in areas that are not blessed with a high level of public transport, which means most places outside inner urban areas, need a motor vehicle to go about their business. The increase in premiums, and the fact that they are much higher in some areas than others, is leading to some people not being able to work or move around.
The increase is also unquestionably leading to an increase in criminality, both through people going around uninsured and, increasingly, through people deciding to borrow a friend’s address with a lower-premium postcode. People also fail to disclose relevant information about themselves, to enable them to become insured. It cannot serve any public purpose that we have ended up with such a dysfunctional system.
I readily concede that that has happened because of a nexus of factors going back a number of years. The operation of the conditional fee system was introduced in the Access to Justice Act 1999 for good a reason: it was thought that it would improve access to justice. To some extent that has certainly been true, but as we all know, it has had the unintended consequence of generally —I am not talking the Trafigura case or one or two others—creating an imbalance in the equality of arms between parties on either side of a legal action. It has gratuitously encouraged the so-called compensation culture.
That, in turn, has been compounded by the costs of the road traffic accident electronic portal being too high. In a recent statement, the Minister said that the figure that was introduced when I was Secretary of State had been agreed in the Civil Justice Council. It was agreed to by both sides, which was why I did not interfere with it. I believe there is now widespread agreement that the current fee, of at least £1,200 for claims under £10,000, is at least twice as high as it should be. It is leading to lawyers advertising as two firms at the end of my street in Blackburn do: they have great banners across their windows saying, “Bring your claim in here, we’ll pay you up to £650 in cash for it.” They can do that and still make a profit out of the £1,200, because the actual costs of running the portal are about £100.
Claims for whiplash, which I have described as an invention of the human imagination, undiagnosable except by dodgy doctors employed by claims management companies, have got completely out of control. The level of whiplash claims is not related to the level of accidents or physical injuries. Accidents are reducing, as is the possibility of being injured in an accident, because cars and road engineering are much safer. It is related principally to the density of claims management companies operating in a particular area. The evidence of that is incontrovertible.
I concede to my hon. Friend the Member for North Durham (Mr Jones) that the regulators have acted properly on claims management companies in some ways, but the regulatory system established under the Compensation Act 2006, during our Administration, has not had sufficient resources to control the trebling in the number of claims management companies that has taken place in recent years.
Another change that took place was in the 2004 solicitors conduct rules, which allowed solicitors to pay referral fees that were previously banned. I will come back to that point when we deal with the enforcement of a ban on referral fees.
Sir Alan Beith
I very much welcome all the effort that the right hon. Gentleman has put into this matter. I hope that in talking about referral fees, he will recognise that although he has devoted a lot of his effort to motor insurance, the same problems affect the cost to consumers in numerous other areas, such as employment law, conveyancing and divorce—all areas in which quite large sums change hands.
Mr Straw
I absolutely agree. I began this journey because of constituents’ concerns about motor insurance, and my private Member’s Bill specifically concentrates on that, but I accept entirely what the right hon. Gentleman has been saying for such a long time and what his Justice Committee said in the report that it published two weeks ago—that the ban on referral fees must be extended beyond personal injury cases.
Jonathan Evans (Cardiff North) (Con)
I am anxious for the right hon. Gentleman to reflect on his point about the change in the solicitors rules in 2004. It is important that the House considers the fact that up until that time, referral fees were banned by the Law Society. It was the intervention of the Office of Fair Trading that resulted in the Law Society changing that rule and recommending the creation of a marketplace, which he has rightly described as later becoming a full-scale scam.
Mr Straw
I said earlier today outside the House that I believe the reason why the OFT has decided rather late in the day to hold an investigation into market conditions in the motor insurance industry is that it is deeply embarrassed by the position that it took in 2004. In no sense could it be said that referral fees encourage fair trading. They are essentially a fraud on the consumer. Lord Justice Jackson, in his magisterial report, completely demolished the OFT’s case in favour of referral fees.
The other body that should examine its processes is the Legal Services Board. I accept readily the reason why the Secretary of State felt obliged to wait for its consideration of referral fees, but its consumer panel released the most extraordinary report stating that referral fees worked in the public interest. If we examine the basis of its research, we find that a third of the people whom it surveyed had received compensation for things like whiplash.
On any objective consumer evidence, and there is plenty of it, it is perfectly plain that the public collectively do not like what they are learning about how the wider insurance industry operates. They reckon they are being defrauded, and that is absolutely true. In motor insurance, for example, a conservative estimate is that at least £2 billion of the total premium income of £9 billion is additional costs caused by the merry-go-round of referral fees.
Mr Kevan Jones
My right hon. Friend is correct that in 2004, referral fees were put on a legal footing. However, many years before that it was quite clear that referral fees were being paid in various guises. My hon. Friend the Member for Bassetlaw (John Mann) and I raised the scandal that was going on in the miners’ compensation scheme. When we were arguing for that practice to be banned, the Government of the time did not do a great deal about it.
Mr Straw
The Government should have done, and as I have sometimes said in respect of that period, my alibi is that I was abroad. I am the last to suggest that the problem has been created by the current Government. I accept that although the Labour Government did many wonderful things, the consequence of a number of things, some of which we introduced and some of which, such as the OFT report, were forced on us, has been the creation of a dysfunctional system.
Mr Jones
The fact that this has become an issue for middle England is quite ironic, but I am angry that when my hon. Friend the Member for Bassetlaw and I raised it in respect of poor mining communities, people did not think it was a great priority. Does my right hon. Friend agree that it is ironic that if we had tackled the problem at that time, the scandals in the motor industry that he has outlined would have been put to bed years ago?
Mr Straw
That might be so—it is good to know that my constituency is representative of middle England.
Similarly unacceptable practices take place in motor repairs. In bottom-line referrals, accident management companies require repairers to give them a discount of up to 25%. The repairers then increase their prices to take account of that bottom-line referral fee. Royal and Sun Alliance outrageously practised a type of subrogation whereby it set up an internal subsidiary, which contracted repairers for, say, £1,000 for a repair, and then added 25%, which was charged to the main company—RSA Ltd—which then charged the at-fault insurer. Product mandating is another unacceptable practice. Deals are struck with, for example, paint manufacturers, and repair companies are required to use specific brands of paint. That has led to a 67% increase in the cost of paint since 2003.
We must act on all those matters, and I hope the Minister will say briefly what will happen on the RTA portal if he gets the chance. I know that he has indicated that he hopes to take action, but is he sympathetic to what I suggest in respect of whiplash and many other matters?
I come now to the issue between the Minister and me. I welcome new clause 18, and I am grateful to the Secretary of State and the Minister for introducing it. However, for my hon. Friend the Member for North Durham (Mr Jones), the right hon. Member for Berwick-upon-Tweed (Sir Alan Beith) and I, there are two issues. First, in my judgment, the breadth of the ban must go wider than personal injury claims. It could be excluded in one or two discrete areas, but in the generality of cases, as the right hon. Gentleman said—he has a great deal of experience—abuse also happens elsewhere.
Secondly, on the question of whether there should be a criminal offence, I noted what the hon. Member for Cardiff North (Jonathan Evans) and my hon. Friend the Member for North Durham said about what happened before 2004, and in a sense, they have made my point. My understanding is that the prohibition on solicitors charging referral fees was in the solicitors conduct rules and that it was not a criminal offence. Those rules changed; it was not that a criminal offence was abolished. I am glad that the Secretary of State proposes to make greater use of the regulatory authorities, and I would not for a moment suggest that that is unnecessary, because it is very necessary. However—this is where, with respect, I found his argument least convincing—there are many other areas of regulation, including, for example, of financial institutions, when conduct that is in clear breach of regulations leads to both a fine or penalty by civil regulatory authorities and a criminal offence. That is particularly true given the vicarious liability requirements imposed by section 7 and others of the Bribery Act 2011.
I applaud what the Secretary of State is doing as far as it goes, but for the life of me, I simply do not understand why, given that he recognises the inadequacy of the 2004 regulatory system and many other things, he does not back that with the criminal law.
Stephen Phillips (Sleaford and North Hykeham) (Con)
I refer the House to my entry in the Register of Members’ Financial Interests.
Given the right hon. Gentleman’s wide experience, can he detect any pattern in relation to those matters where an action by a regulated body constitutes something that could lead both to regulatory action by the regulator and to criminal sanction under the statutes? If so, it would be interesting to know which side of the line the new clause and the matters to which it refers lie.
Mr Straw
The hon. and learned Gentlemen may have noticed that I need to research that point, but I have in the back of my mind a number of cases where breaches of regulations are dealt with both by the regulator and in criminal proceedings. He is experienced in the law and will know that plenty of criminal offences are also civil wrongs of some kind in common law or by regulations.
Sir Alan Beith
The right hon. Gentleman has an arguable case on the merits of a back-up criminal offence, but will he concede that the system proposed by the Government can be made to work, because it combines the regulatory framework with the criminal offence behind it, particularly if there is a custodial sentence? The data protection offence, which lies behind the Government’s proposal, is already a criminal offence.
Mr Straw
Christopher Graham, the distinguished Information Commissioner, made the point that one reason why the penalty for breach of section 55 of the Data Protection Act needs to be increased—as it is by sections 77 and 78 of the Criminal Justice and Immigration Act 2008 to a maximum of two years imprisonment or an unlimited fine—is to send a message to people in those industries that they could end up in prison if they go in for an egregious breach. Of course, other breaches of data protection rules could mean that an organisation loses its licence, but in extremis, we need criminal proceedings for a criminal offence.
My view is that the same must apply in respect of breaches of the law banning referral fees. My amendment (e) would produce exactly the same penalty—it is entirely proportionate—as applies under sections 77 and 78 of the 2008 Act, which I hope the Government bring into force quickly given that they are already on the statute book. With that, and because I know that many others wish to speak, I thank Members on both sides of the House for the support that they have given to my campaign, and commend the amendment to the House.
Damian Hinds (East Hampshire) (Con)
It is a great pleasure to follow the right hon. Member for Blackburn (Mr Straw), who put his case so comprehensively and convincingly.
I should like to speak briefly in support of the Government’s position and to ask a question of clarification. Clearly, referral fees and how they work have contributed enormously to the insurance costs of people in Blackburn, East Hampshire, middle England—wherever that is—and everywhere else, and change is needed. We had a strange mini-debate in the Public Bill Committee evidence-taking session on whether there was a compensation culture in this country. Some Opposition Members suggested that there was not and cited the noble Lord Young of Graffham in defence of their case, which is rather a tricky one to argue. Anyone who has received those annoying automated phone calls and text messages, or who has even a glancing familiarity with daytime television, can say that it is intuitive and self-evident that there is a compensation culture.
I understand that one of the original reasons for introducing referral fees was to allow an online market to develop—it was said that that would be a good thing because it might increase competition and access to justice. I shall come back to the online market element in a moment, but the claim that referral fees improve access to justice is at best grossly exaggerated. It might well be that approaching a solicitor with such a case was foreboding 20 years ago, but it is not now, following the development of no win, no fee cases and so on.
It is difficult to say exactly how big the claims management company sector is, but it might be of the order of £0.5 billion, which is enormous. There is nothing wrong with making money, but from a public policy perspective, we must draw a distinction between activities that add value to the individual and those that just take a share of the value chain and ultimately push up costs for everybody else. That is combined with the natural distaste that we have for selling people’s cases as some kind of commodity. The hon. Member for Stretford and Urmston (Kate Green) referred to the ability of industry players to shape-shift. I think that the new clause would effectively prohibit subcontracting, but not, of course, mergers and acquisitions, which would simply create a new form.
Mrs Louise Ellman (Liverpool, Riverside) (Lab/Co-op)
I welcome tonight’s discussion about action on referral fees. In March, the Transport Committee produced a report in which we investigated the reasons for the 40% increase in premiums for private motor insurance. We identified referral fees as one of the reasons. The others included cold calling, inflated bills, high accident rates among young people, fraud and uninsured driving. However, I seek clarification on two areas from the Minister, although some of these points have been raised in earlier contributions.
The first issue is the scope of the Government’s proposals. The Committee’s report referred to the merry-go-round of referral fees and identified not only solicitors, but credit hire firms, vehicle repairers, medical experts and management accident firms. I am not clear from the Minister’s explanation of the new clause whether all, or some, of these organisations will be included in the proposals. If we are looking at referral fees as a reason for the greatly increased costs of motor insurance premiums, it is not good enough to look only at solicitors; we have to look at all these other areas as well.
The second area relates to how companies would be prevented from finding ways of avoiding the new legislation. When the Committee conducted its first inquiry on this issue, we received evidence that if referral fees were banned claims management companies would buy solicitors’ practices and, under the plans for alternative business structures, it could be normal for non-legally qualified individuals to do so. On the face of it, it seems that there would be an easy way of avoiding the legislation. I have not heard anything in detail about how that would be addressed. The Minister is correct that he was asked that question when he came before the Committee two weeks ago, but we received no clear explanation of how the issue would be addressed.
Those are the points that I wished to raise tonight. I know that I shall have other opportunities to look more broadly at the rising costs of motor insurance, but tonight, in this debate on action to be taken over referral fees, I ask for further explanation about how the Government’s proposals will deal with those two important points.
Bob Blackman (Harrow East) (Con)
I, fortunately, have not been the victim of a car crash or accident at work, although, judging from the volume of texts, e-mail messages and voice calls to my mobile and home phone one might believe that I was confined to a hospital bed or wheelchair. This is one of the aspects that have to be combated in legislation. I therefore support what the Government are doing in trying to prevent this type of activity, although I would like clarification from the Minister on three issues.
My hon. Friend the Member for East Hampshire (Damian Hinds) alluded to the first matter: the definition of “referral fee” and the potential for people to get around it. That is rather important, particularly given that it has been suggested that we make it a criminal offence. While the definition lacks clarity, it will be difficult to make it a criminal offence.
The second important issue is fairness for the individual. If a victim of an accident—for example, someone who has suffered a spinal injury—goes along to their high street solicitor for advice and help, the firm might decide to give that help and advice and start the case, but somewhere along the line it might determine that it does not have the expertise necessary and refer it to an expert solicitor who deals with nothing but such claims. How will the first solicitor be recompensed for their work, if they cannot claim a referral fee? I would like clarification on that point, because, quite clearly, that would require a great deal of professional work for which the solicitor might not receive any recompense. That needs to be clarified.
Mr Straw
Surely, the firm would get paid for the costs it had incurred. Indeed, it would not pass on the file until its costs had been paid. Does the hon. Gentleman accept that a further defect of referral fees is that they might skew the judgment of the first solicitor advising the client on the best firm to go to? The solicitor might make a decision on the basis not of which is the best firm, but of which is likely to pay the biggest referral fee.
Bob Blackman
The other problem is that if solicitors did not believe that they would get paid for the work, they might hang on to the case and take it to conclusion, despite not being an expert. That presents a huge risk to the individual, who possibly has a case.
Mr Slaughter
I agree entirely with my right hon. Friend the Member for Blackburn (Mr Straw). To put it slightly differently, the hon. Gentleman is quite right that firms might want to hang on to work even after it goes beyond their expertise, so an inducement to pass it on might work. I am not saying that in favour of referral fees, but it does happen, and we have to be aware of it.
He is absolutely right about the definition of referral fees. When the Minister announced, rather hastily, in response to my right hon. Friend, that the Government were banning them, he admitted that he could not define “referral fee”. The hon. Gentleman is absolutely right, therefore, that a number of problems still need to be resolved, but those are questions that he should be putting to his Front Bench team. He should be asking why they have not sorted out these matters, including on his point about text messages.
Bob Blackman
As I said, I hope to get clarity at the conclusion of the debate, because this is clearly a problem. I would like these illicit text messages and such like to be criminalised, because they are clearly an abuse of the law. Indeed, as my right hon. Friend the Member for Berwick-upon-Tweed (Sir Alan Beith) said, they should be criminalised already under the Data Protection Act, because they constitute an abuse of personal data.
I seek clarity on a third issue: the effect on claims management companies of banning referral fees. I sought advice from Accident Advice Helpline, which is based in my constituency. It informs me that only one in six of its 36,000 cases last year were referred to solicitors, with the rest being screened out. Of those, 70% led to a settlement, with 15% dropped owing to “no involvement”. I could go through all the details of the data, but the reality is that Accident Advice Helpline screens the cases, which costs money. If Accident Advice Helpline does not do that, other solicitors will have to do it, at a cost to themselves. I would therefore like some clarity on what the effect will be and how it is proposed that those companies will be funded so that they do not fall foul of the regulations.
Kate Green
I, too, am keen to ask the Minister some questions, similar to those put by the hon. Member for Harrow East (Bob Blackman).
I completely share other hon. Members’ concerns about securing much better protection for the consumer, but given that the amendments have been introduced rather hastily I hope that the Minister will assure us that there will be a level playing field for different business types and, in particular, that access to independent legal advice from independent solicitors will be protected for claimants.
I therefore seek a fuller explanation from the Minister of how it is intended that referral fees will be defined. Specifically, to what extent does he see marketing activity by solicitors and others as covered—or not covered—by the provisions? For example, as has already been suggested, if a high street solicitor takes on some work, but realises that he or she does not have the expertise to pursue the case and therefore refers it to another solicitor and arranges some form of fee sharing, how is it intended that this should be treated under the provisions? Some solicitors have grouped together to pool their marketing budgets. Is the intention of the Minister’s amendments to outlaw pooled marketing completely or to cover it in regulation? It would be useful to have some clarification on that.
I welcome what the Minister said in answer to my earlier intervention about alternative business structures, but I am curious to know what his assessment is of the possibility that more and more large claims management companies will seek to handle all such business in-house and will stop using the services of other legal firms or legal experts. Has he made any assessment of the possibility of the provision of such services being concentrated in a way that reduces consumer choice and independent advice, and will he say what steps he might take to address that?
Mr Kevan Jones
I welcome the banning of referral fees, and I congratulate the Minister and the Government on doing it. The scandal is that, frankly, it should have been done years ago. My hon. Friend the Member for Bassetlaw (John Mann) and I campaigned hard to expose the scandal surrounding the miners compensation scheme, which created a feeding frenzy not just for solicitors but for claims management companies. As I have said before—and to answer the hon. Member for Harrow East (Bob Blackman)—I frankly do not care if they all go bust, because they are not needed in this process. If people need legal advice, they go to a solicitor. Claims management companies have acted like parasites on the access to justice model that we have had in this country for many years.
I find it ironic that my right hon. Friend the Member for Blackburn (Mr Straw) said that I was referring to Blackburn as a middle-England constituency, because I was not. The fact of the matter is that my hon. Friend the Member for Bassetlaw and I, along with one or two other Members, argued hard about the scandal surrounding the miners compensation scheme. One of the key points was referral fees and the amount of money received not only by solicitors but by unscrupulous trade unions and unscrupulous claims handling companies. The issue was regulated in 2004, with referral fees being made legal. However, in the case of the miners compensation scheme it was quite obvious that referral fees were being paid and that the Law Society was turning a blind eye—I always refer to the Law Society as the best trade union in the world, because it does such a good job of protecting its self-interest.
Sir Alan Beith
Like the hon. Member for North Durham (Mr Jones), I had coal mines in my constituency. There were three working mines there, and I saw evidence of the scandal that he described. It was absolutely dreadful in many ways. Today, I want to ask for clarification of the Government’s intentions in two areas. One relates to the broadening of this issue beyond personal injury. New clause 18 provides for the Lord Chancellor to make regulations specifying wider ranges of legal businesses. I hope that there is a clear intention on the Government’s part, probably involving consultation, to move on to all the sectors in which referral fees have the potential to distort or damage competition or to undermine the position of the consumer. I would like a clear indication that the Government are going to examine a number of other areas.
Secondly, the Minister was very helpful earlier on the question of custodial sentences for breaches of the Data Protection Act, and I hope that that means that the Government have moved on from their position of saying, “We’ll have to wait until the end of the Leveson inquiry.” That represented a complete misunderstanding of the situation. The question of custodial sentences for data protection offences is not primarily about the issues that have been raised in the Leveson inquiry about the media; it is about the everyday circumstances of our constituents whose personal information is abused by the organisations that hold it. That matter ought not to have to wait until the completion of an inquiry into a wider range of issues. I hope that the Minister’s earlier helpfulness will be repeated in implementing a measure on which the House has already decided—namely, that there should be a custodial penalty in such cases.
Mr Djanogly
We have had a good, far-ranging debate this afternoon. Given that another important debate needs to be completed by 8 o’clock, I am sorry to say that I shall have to make my way quickly through the points that have been raised. I am pleased to hear at least a grudging agreement in principle with our ban on referral fees from the hon. Member for Hammersmith (Mr Slaughter). I thank my right hon. Friend the Member for Carshalton and Wallington (Tom Brake) and all the other right hon. and hon. Members for their support for our desire to implement the ban. I am pleased that the debate today has been about how that should be done, not about whether it should be done.
The hon. Member for Hammersmith asked why we had not consulted on banning referral fees, and I can tell him that Lord Justice Jackson made 109 recommendations, and it would not have been practical to consult on them all at once. It also made good sense to await the outcome of the Legal Services Board’s work in this area. Many respondents to our consultation on implementing Lord Justice Jackson’s recommendations included their views on referral fees. Those views, along with the work undertaken by the LSB and the Transport Committee, have been carefully considered. The hon. Gentleman clearly raised some serious issues relating to the regulation of claims management companies, but they were not directly relevant to the Bill. I must point out that, in the past year, the Ministry of Justice has cancelled 349 authorisations of CMCs, whereas in the last year of the Labour Government, it cancelled only 35.
The hon. Member for North Durham (Mr Jones) asked a number of important questions. If he does not mind, I will write to him about those issues. I can say, however, that under the Compensation Act 2006, it is an offence to provide regulated claims management services unless authorised or exempt. The hon. Gentleman will not be surprised to learn that the exemption applies to trade unions, and that is part of the problem that he rightly highlighted. I was present at the debate that he held on that subject several years ago.
The hon. Member for Hammersmith covered several other matters, but he essentially spoke to tomorrow’s debate, and we will deal with those issues then. My right hon. Friend the Member for Carshalton and Wallington asked about some important aspects relating to the consumer. The Chairman of the Transport Select Committee, the hon. Member for Liverpool, Riverside (Mrs Ellman), rightly mentioned that share premiums had risen by 40% in the last year alone. This is of course a matter of concern, and we have discussed it with the Association of British Insurers. It has said that if the proposals are effected with the other changes to recoverability of success fees in after-the-event insurance, it would hope to see a fall in insurance premiums. I certainly hope that that is a credible position.
As I said at the outset, there is broad support across the House for a ban on referral fees, although there is some disagreement on how best to implement the ban. The right hon. Member for Blackburn (Mr Straw) spoke to his amendments with typical passion, but I would like to set out briefly why the Government cannot support them. Amendments (a) to (c) to new clause 18 seek to capture within the prohibition all arrangements to pay or receive referral fees, even when a payment has not yet been made. These amendments might have been tabled in support of his amendment to make the payment and receipt of referral fees a criminal offence. However, I am concerned that capturing an agreement to pay referral fees when payment might not have occurred would be very difficult to enforce. A solicitor’s accounts, for example, might well show that a particular payment had been made that could, on the face of it, be a referral fee. However, it is unlikely that agreements, which in some cases might be no more than verbal agreements, could be so readily identified without time-consuming investigation. In any event, we do not think that it is necessary to provide for this eventuality, first because such agreements would be unenforceable under subsection (6) of new clause 19 and, secondly, because whatever might be agreed, the payment of the referral fee would still be prohibited. So, in practice, it is unlikely that a party would enter into an agreement to pay a referral fee when payment would be a breach of the prohibition and the agreement would not be enforceable.
I have already dealt, in moving the new clause, with the arguments against amendment (e), which seeks to create a new criminal offence. I should just reiterate that the Government are fully committed to ensuring that the ban will work effectively.
Mr Straw
When I made my point about the banning of referral fees being backed by the criminal law, the Lord Chancellor did not say that he agreed with me, but he did say, on 13 September:
“We are now considering the way in which to put this into practice, but it is likely to be in the form recommended”—[Official Report, 13 September 2011; Vol. 532, c. 879.]
—that is, a criminal prohibition as well as a regulatory one. He appeared to have an open mind about that, so what has changed since then?
Mr Djanogly
I have just confirmed with my right hon. Friend the Lord Chancellor that, in the next sentence of that quote, he said that he had not committed to creating a criminal offence.
I can assure the right hon. Member for Blackburn that we have thought long and hard about how to achieve this, and I am aware of the concerns raised in the Justice Committee’s recent report on referral fees and the theft of personal data. The Committee’s Chairman made the point again today that the penalties for breaching section 55 of the Data Protection Act were not sufficient. The Government are keeping the question of whether to introduce custodial penalties for section 55 offences under review, and we will respond to the Justice Committee’s report in due course. However, the issue of how to deal with people such as rogue motor garage workers or nurses who are breaking the law by breaching the Data Protection Act is separate from that of how to introduce a new ban on regulated bodies to prevent them from paying referral fees, which they are currently permitted to do. I strongly believe that our ban, which will stop lawyers, claims management companies and insurance companies from paying and receiving referral fees, will remove the incentives for selling personal data from the whole system. That is because there will be no one for the rogue garage, for instance, to sell the data to, as all the people in the system who can make any profit out of handling claims will be prevented from paying referral fees. My hon. Friend the Member for East Hampshire (Damian Hinds) well set out the complexity involved in this instance.
1. Regulator | 2. Regulated person |
|---|---|
the Financial Services Authority | an authorised person (within the meaning of the Financial Services and Markets Act 2000) of a description specified in regulations made by the Treasury |
the Claims Management Regulator | a person authorised by the Regulator under section 5(1)(a) of the Compensation Act 2006 to provide regulated claims management services |
the General Council of the Bar | a person authorised by the Council to carry on a reserved legal activity within the meaning of the Legal Services Act 2007 |
the Law Society | a person authorised by the Society to carry on a reserved legal activity within the meaning of the Legal Services Act 2007 |
a regulatory body specified for the purposes of this subsection in regulations made by the Lord Chancellor | a person of a description specified in the regulations in relation to the body |
1. Regulator | 2. Regulated person |
|---|---|
the Financial Services Authority | an authorised person (within the meaning of the Financial Services and Markets Act 2000) of a description specified in regulations made by the Treasury |
the Claims Management Regulator | a person who is authorised by the Regulator under section 5(1)(a) of the Compensation Act 2006 to provide regulated claims management services and is of a description specified in regulations made by the Lord Chancellor |
an approved regulator for the purposes of Part 3 of the Legal Services Act 2007 (approved legal activities); | a person who is authorised by the regulator to carry on a reserved legal activity and is of a description specified in regulations made by the Lord Chancellor |
a licensing authority for the purposes of Part 5 of that Act (alternative business structures) | a person who is licensed by the authority to carry on a reserved legal activity and is of a description specified in regulations made by the Lord Chancellor’.—(Mr Dunne.) |
The Parliamentary Under-Secretary of State for Justice (Mr Crispin Blunt)
I beg to move, That the clause be read a Second time.
Mr Speaker
With this it will be convenient to discuss the following:
Government new clause 24—Power to increase certain other fines on conviction by magistrates’ court.
Government new clause 25—Power to amend standard scale of fines for summary offences.
Mr Blunt
The new clauses are designed to remove the upper limits on the fines that can currently be imposed in magistrates courts. Raising the upper limits on fines gives sentencers greater flexibility to identify the most effective punishment appropriate to the offences and offenders before them, particularly when combined with other disposals such as suspended sentences when offenders are close to the custodial threshold.
The Government believe that financial penalties, as long as they are set at the right level, can be just as effective as community payback or curfews in punishing offenders and deterring them from further offending. Fines hit offenders where it hurts: in their pockets. They also have the advantage of not affecting opportunities for employment or having an impact on family responsibilities, and hence can prevent further acceleration into a criminal lifestyle. Moreover, they do not impose a further burden on the already hard-pressed taxpayer or on society as a whole. Not only are fines punitive; they provide reparation for society, and serve as part of offenders’ restoration to all of us.
That is why courts already have flexibility to impose fines in cases that have passed the community sentence threshold. It is entirely right for them to be able to consider the circumstances of the offences and of the offenders before them, and, having weighed up the various purposes of sentencing, to decide that a fine will provide an appropriate level of punishment and deterrence without needing to consider a community order. Courts already have wide discretion to make use of fines in appropriate cases, and the Government want to support and encourage that.
We particularly wish to ensure that magistrates, who issue the vast majority of fines, have the powers that they need to set fines at levels that are proportionate to the most serious offences that come before them for trial. These clauses therefore make two key changes to the way that fines operate in the magistrates courts. The first is to replace all upper limits of £5,000 or more for fines available on summary conviction. At the moment, where an offence is triable on summary conviction only, magistrates do not have the option of committing the case to the Crown court for sentence and are constrained in their ability to fine by the statutory maximum fines. For the most serious offences tried by magistrates, that is generally £5,000, although for certain offences where the financial gain from offending is substantial—for example, in some environmental offences—the maximum fine can be as high as £50,000.
For less serious offences, we believe that it is right to retain the differentials between the punishments. However, we wish to give Government and Parliament more flexibility to amend these maxima as the need arises.
Mr Blunt
If my hon. Friend will forgive me, I need to conclude my remarks and allow the Opposition to respond.
The second change these clauses propose is to give the Secretary of State a power to increase the current maximum fine amounts for levels 1 to 4 on the standard scale of fines for summary offences. These amounts are currently £200, £500, £1,000 and £2,500. The new power would be to increase these so as to keep them in the same ratio to one another as at present. There is already a similar power to change them in line with changes in the value of money, so the new power would be an extension of that. We intend to consult on the right level at which to set these new maxima.
That should form part of a wider review of sentences served in the community, so I want to use this debate to notify the House that we are entering a review process, which we intend will in due course lead to a formal public consultation on community sentences. For too long, community sentences have failed to punish offenders properly for their actions, and the Government are committed to changing that. We are already taking action, including through this Bill, to strengthen community orders, but we want to go much further and deliver a step change in the way sentences operate. They must, of course, address the problems that have caused the offending behaviour in the first place—the drug abuse, the alcoholism, the mental health problems—but they must also punish properly and send a clear message to society that wrongdoing will not be tolerated. We want to see a clear punitive element in every sentence handed out by the courts.
We will consult on further reforms to ensure that community sentences effectively punish and rehabilitate offenders. That should include consulting on what constitutes effective delivery of the principles of sentencing, punishment and rehabilitation, as I have mentioned, but also on protection of the public, restoration and how the whole package can produce the most effective deterrent to crime. A part of this consultation will be on the new maxima at levels 1 to 4 in the magistrates courts.
The Government want offenders to be in no doubt that the courts have the powers they need to punish their crimes. Once the victim’s compensation has been addressed—and if an offence presents no wider issues of reparation or public protection—if a court believes that a fine would be the best way of punishing an offender and deterring future offending, then we want to ensure that there are no barriers to courts setting the fine at the appropriate level.
To sum up, these new clauses would remove the £5,000 cap on fines that magistrates can impose, so that they are able to use their discretion and set fines that are proportionate to the offences before them. That will also improve the efficiency of the court system, by removing the need for magistrates to send cases to the Crown court when they feel the current maximum fine is not a severe enough punishment for the offenders before them. For offences with caps set at less than £5,000, we propose to retain the current structure of differential maxima, with a power to increase them as necessary.
I urge Members to support the measures.
Mr Slaughter
I thank the Minister for his clear account of the effects of these proposals, but I wonder why they are being introduced at this stage. He may wish to explain that. They are not controversial. We do not intend to oppose them as we think their measures are sensible, and we are glad that the Government are, for once, in favour of judicial discretion. They made certain concessions in Committee, one of which was not withdrawing magistrates’ powers to impose longer custodial sentences. We believe the magistrates system serves this country extremely well—this year marks its 650th anniversary. However, although these are sensible changes to current magistrates powers, we are concerned about the fact that, once again, they are part of a package of new measures.
I will not take up any more of the House’s time as we shall shortly come on to discuss two very important and significant new provisions in the criminal law, of which we have had very little notice as they have been introduced at a very late stage. I therefore simply ask again why we have had to wait until Report stage for the measures currently under discussion to be introduced. We do not oppose the proposals, however, as we consider them to be sensible and uncontentious.
Sir Alan Beith
How nice it is to hear the hon. Member for Hammersmith (Mr Slaughter) in conciliatory mood. The Minister has made a perfectly good case for increasing the level of fines available in magistrates courts. He gave several reasons for doing so, and I would add to them the giving of further encouragement to magistrates to deal with cases themselves wherever that is possible, rather than referring them upwards to the Crown court. This is part of a general increased empowerment of magistrates to deal with cases.
The Minister has mentioned the wider issue of community penalties and non-custodial sentences, and the review and consultation that will address them. I hope that proves to be a fruitful process. There is a danger that he is giving two signals at once, however. He is hoping to give the necessary signal to the public that many offenders consider community sentences to be more demanding and rigorous, and much less congenial, than very short terms of imprisonment. Some offenders who have appeared before the Justice Committee have said they committed further offences because it was easier to spend the time in prison than to continue with a community sentence. The Government must also give a signal to the judiciary that it should make the maximum use of the available range of penalties, on the basis of what is most likely to reduce reoffending. If a rigorous, well-supervised and policed community sentence is more likely to reduce reoffending, the judiciary should be encouraged to choose that option. I hope people do not find the signals too confusing, that we end up with a well-supported system of community penalties, and that people have confidence that for many offenders such penalties reduce reoffending more effectively than prison does.
Gareth Johnson
Although I support the Government’s proposals, it would make sense to remove the upper limit on financial penalties imposed by magistrates courts. The proposals do not relate to levels of compensation, so if magistrates are asked to sentence for, say, a theft of £5,000-worth of goods, they will still have to refer the matter to the Crown court for sentence if they do not have the power to award more than £5,000 compensation. I therefore wonder whether the Government would be willing to look at the levels of compensation in the future, to see if there is any scope for lifting the upper limit of compensation awards that magistrates courts can impose.
Mr Blunt
I am grateful to have this brief opportunity to respond to the points raised. Let me see if I can do justice to the grudging support of the hon. Member for Hammersmith (Mr Slaughter). I am certainly profoundly grateful that we found him in a positive mood, and the fact that he welcomes these measures gives the answer to his questions. They are appropriate measures; that is why they are being welcomed across the House.
My right hon. Friend the Member for Berwick-upon-Tweed (Sir Alan Beith) is absolutely right that many defendants consider a proper combination of community sentences to be much more onerous than custody—and I want to increase the opportunities for that to be seen as much more onerous than custody. My hon. Friend the Member for Shipley (Philip Davies) is not present, but I remember him citing an example from the Daily Mail about a judge who threw the book at an offender because he thought he could not send him to prison: he gave the offender a combination of community sentences that were much more onerous than the custody would have been.
We want to get to a place where we can get a better balance on sentencing, to make sure that we actually punish people in the most appropriate way and give sentences greater flexibility. That is what this measure will do. I will write to my hon. Friend the Member for Dartford (Gareth Johnson), who made an entirely proper point. I want to make it absolutely clear that compensation comes first—
Mr Deputy Speaker (Mr Nigel Evans)
Before we embark on the next debate, may I draw attention to Mr Speaker’s request, made earlier this afternoon, for brevity from the Front Benchers and Back Benchers in these debates so that all the important matters before the House for decision today can be properly considered?
New Clause 27
Reasonable force for the purposes of self-defence etc
‘(1) Section 76 of the Criminal Justice and Immigration Act 2008 (reasonable force for the purposes of self-defence etc) is amended as follows.
(2) In subsection (2) after paragraph (a) omit “and” and insert—
“(aa) the common law defence of defence of property; and”.
(3) After subsection (6) insert—
“(6A) In deciding the question mentioned in subsection (3), a possibility that D could have retreated is to be considered (so far as relevant) as a factor to be taken into account, rather than as giving rise to a duty to retreat.”
(4) In subsection (8) for “Subsection (7) is” substitute “Subsections (6A) and (7) are”.
(5) In subsection (10)(a) after sub-paragraph (i) omit “or” and insert—
(ia) the purpose of defence of property under the common law, or”.’.—(Mr Blunt.)
Brought up, and read the First time.
Mr Deputy Speaker
With this it will be convenient to discuss Government amendments 136 and 141.
Mr Blunt
I shall certainly be following Mr Speaker’s direction, and I hope that we will dispose of this matter in as short an order as we disposed of removing the limit on magistrates’ fines.
The question of how far one can go to defend oneself crops up again and again in the letters Members of Parliament receive from their constituents, and of course it is always a controversial issue in the press and the media. It usually arises because a hard-working, law-abiding home owner or shopkeeper has been forced to defend themselves against an intruder and has ended up being arrested for it. Being confronted by an assailant in one’s home, on the street or anywhere else can be a terrifying prospect. It is essential that the law in this area is clear, so that people who use reasonable force to defend themselves or to protect their properties can be confident that the law is on their side.
There will always be occasions when the police need to make an arrest to enable a prompt and effective investigation, especially if they turn up at an address and somebody is dead. We are working with the Home Office on new guidance for the police to ensure that arrests are made only where necessary, but these provisions should give people greater certainty that the law itself is on their side and they will not be prosecuted or convicted if they have only used reasonable force.
Mr Llwyd
Will the Minister advise the House how the provisions change the common law doctrine and principle of a person being able to protect his or her property using force and the doctrine of self-defence, where reasonable force is used to defend oneself? I asked the Lord Chancellor that yesterday and he told me to wait until today for the answer—I am all ears.
Mr Blunt
The right hon. Gentleman should listen out for the next passage of my remarks, as I hope it will give him and the rest of the House satisfaction.
On the specific provisions, the new clause is not designed to sweep away the fundamental premise that somebody can use reasonable force in self-defence. In my view, that aspect of the law is entirely sensible. Allowing somebody to use unreasonable or disproportionate force would be very dangerous indeed, as it would effectively sanction vigilantism or violent retribution. Instead our proposals are designed to clarify what “reasonable” force means in practice. The new clause will amend section 76 of the Criminal Justice and Immigration Act 2008 to make it clear that a person can use reasonable force to defend property in addition to defending themselves, other people or preventing crime, and that they are under no duty to retreat from an offender when acting for a legitimate purpose, although if they had a chance to retreat, the court may still consider it when deciding whether the force used was reasonable in the circumstances. We did not consult on these measures because of the limited nature of the amendments, but that should not detract from their importance in reassuring householders and small shopkeepers who use reasonable force to defend themselves and their properties that the law is on their side.
Karl Turner (Kingston upon Hull East) (Lab)
Does the Minister not accept that the law works perfectly well as it is? Some years ago, I defended someone who had chopped off someone’s ear with a samurai sword and the jury acquitted him, saying that he had used reasonable force in the circumstances.
Mr Blunt
I cannot comment on that individual case—[Interruption.] The shadow Justice Secretary tempts me down that road, but I will resist. The much clearer message that will be sent if the House chooses to accept the Government’s proposals will mean that the position should be crystal clear to householders and shopkeepers on the force that they are entitled to use. That is the purpose of these provisions. We are seeking to reassure the public, and this all sits as part of our desire to have a society that can exercise its rights and properly defend those rights, and that does not feel that people have to pass by on the other side, particularly when their lives and property are at risk.
Mr Llwyd
May I suggest to the Minister that legislating is not all about giving out signals and that it is about making law? I have no axe to grind personally with the Minister, who is a perfectly decent man and who engaged with us in Committee on many matters, above and beyond his brief. However, he may have wished to circulate a photocopy of the Crown Prosecution Service guidance on self-defence and the prevention of crime. Any fool can read and understand it, as it says simply, under the heading of “Reasonable Force”:
“A person may use such force as is reasonable in the circumstances for the purposes of: self-defence; or defence of another; or defence of property”.
It goes on to describe a further two matters. Providing a copy of that would have done, rather than using legislative time.
Mr Blunt
I am very grateful—[Interruption.] I am not embarrassed in the least. This measure forms part of the coalition agreement. We are delivering on that, sending a clear message and putting the law beyond doubt. Having things buried away in guidance to prosecutors, given that reassurance is needed for home owners and shopkeepers, is a distinctly sub-optimal way of proceeding on an issue such as this. When viewed in conjunction with the Home Secretary’s plans to strengthen the code of arrest for the police, we hope that these measures will help to fulfil the commitments in the coalition agreement on this issue. We must take together the instructions to Crown prosecutors, the legislation that I hope will go on to the statute book as a result of these Government measures and that code of arrest for the police, and I can therefore happily commend these proposals to the House.
Sadiq Khan
First, may I say, for the avoidance of doubt, that Labour Members do not intend to oppose new clause 27 or the consequential amendments, even though it is simply a rehash of an existing law and this valuable parliamentary time could have been used to discuss contentious issues that have caused real concern for many of our constituents? It was the previous Government, through section 76 of the Criminal Justice and Immigration Act 2008, who placed the common law of self-defence into statute.
Since that time, there have been a number of calls, especially from those on the right, to “tighten” the laws on self-defence because they think that is good politics. Back in February 2010, the Prime Minister argued that the law needed further tightening to benefit the home owner against the burglar. Indeed, the Conservative party manifesto said that it would
“give householders greater legal protection if they have to defend themselves against intruders in their homes.”
The Conservatives have floated on a number of occasions the issue of reasonable force and changing the law to allow anything other than actions that are grossly disproportionate. Back in December 2009, the shadow Home Secretary, now Minister of State, Department for Work and Pensions, the right hon. Member for Epsom and Ewell (Chris Grayling) committed a future Conservative Home Secretary to changing the law so that convictions against householders would happen only in cases where the actions involved were “grossly disproportionate.” But despite all the spin, that change has not materialised. The new clause will not allow home owners to use grossly disproportionate force or disproportionate force. It will not even strengthen the law. That is because expert opinion and evidence on the issue of self-defence for home owners is pretty unanimous.
It is widely accepted by those at the coal face that the law on self-defence works pretty well and it is unclear in many quarters why the law would need strengthening. The Director of Public Prosecutions, Keir Starmer QC, has said:
“There are many cases, some involving death, where no prosecutions are brought. We would only ever bring a prosecution where we thought that the degree of force was unreasonable in such a way that the jury would realistically convict. So these are very rare cases and history tells us that the current test works very well.”
That approach is further reinforced by what has happened in recent months. That is why the Minister, whom we all like, is embarrassed by having to move the new clause and why his right hon. and learned Friend the Justice Secretary, whom we all love, has disappeared from the Chamber. Recent cases involving home owners such as Vincent Cooke in Cheshire, Peter Flanagan in Salford and Cecil Coley in Old Trafford, in which intruders were killed, have demonstrated that when reasonable force is deemed to have been used, the Crown Prosecution Service has not brought any charges, so the current law works. I see that a note is desperately being passed to the Minister—it is probably a sick note from the Justice Secretary.
Paul Mendelle QC, a previous chairman of the Criminal Bar Association, said:
“The law should always encourage people to be reasonable, not unreasonable; to be proportionate, not disproportionate.”
He went on to add that the current law worked perfectly well and was well understood by juries. Just yesterday he argued in The Guardian that the two areas of change proposed by the Government are nothing of the sort. By amending section 76 of the 2008 Act so that there is no duty to retreat before force they are restating the current law. I think it is called rearranging the furniture: things might look different, but nothing of substance will have changed.
Sadiq Khan
I am glad that the hon. and learned Gentleman welcomed the Labour Government’s section 76, but it is because we have already done that that there is no point in doing it again. I appreciate that he would like to seek the glory for doing so, but we have already done it. There is no need to reinvent the wheel.
Sadiq Khan
With the greatest respect to the hon. and learned Gentleman, he is wrong.
Far from requiring retreat, the current law allows that even the first blow can still be reasonable force in self-defence. It is unclear what including the defence of property in the 2008 Act will add to the law as it does not differ from existing interpretations. The right hon. Member for Dwyfor Meirionnydd (Mr Llwyd), who speaks for Plaid Cymru, has given examples from the CPS guidance written in plain English. Perhaps he is suggesting that we should publish the CPS guidance and deliver it to every household in England and Wales, but I think that would be a waste of time. The Minister seems to believe that voters—home owners—will read the Bill to seek clarification of the law.
Using legislation as a public relations stunt is no way to run a Government, especially when measures are introduced at the eleventh hour. Not only have the clauses on self-defence not been subjected to scrutiny or consultation, but it is not clear how much they will add to legislation on self-defence. The Government’s own impact assessment confirms that there will be no impact on the MOJ, so what we have today is not the Conservatives’ manifesto pledge—that is another broken promise, by the way—or a strengthening of the law, as it has been spun as being, but a simple restatement of the policy on self-defence, which had already been restated excellently back in 2008. For those reasons, we will not oppose the measures.
Mr Llwyd
It is often said in parliamentary circles that amendments, especially those moved by Opposition Members, are otiose, although I venture to suggest that few people outside this Chamber use that word, let alone know what it means: namely, that something is pointless. I start on the basis that this is pointless and I shall develop my argument point by point, if I am allowed to do so.
Sadiq Khan
Does the right hon. Gentleman mean the Justice Secretary or this new clause?
Mr Llwyd
No, like the right hon. Gentleman, I have the highest regard for the right hon. and learned Gentleman and I presume that this evening he is exercising his own right to self-defence by not being here. He has withdrawn from the Chamber and the possibility of being dealt a few blows that could actually hurt him. I say that not in a rude or pejorative fashion but in a semi-jocular way.
Yesterday, I asked the right hon. and learned Gentleman to answer the very question I also asked the Minister: what would be the exact difference in the law after this measure was introduced? Answer came there none from the right hon. and learned Gentleman, except, “Hang on until tomorrow and all will be revealed.” In the past few minutes, the Minister has revealed all and, blow me, I am underwhelmed! I listened intently but reason or logic came there none and changes less still, so I am still none the wiser. “Could it be,” I ask myself, “that the Government are speaking to an audience outside the Chamber?” Surely not; surely, they are not actually addressing an audience outside the Chamber such as the tabloid groups. No, never, that could not be right—I have dismissed that idea.
Currently, a householder may use reasonable force to defend him or herself or another, or in the prevention of crime, which includes defending a person’s property. The new clause therefore does nothing. The use of force in self-defence is governed by common law and the use of force in the prevention of crime is governed by section 3 of the Criminal Law Act 1967. In both cases, the test to be applied is whether the force used was necessary and, if so, whether the degree of force used was reasonable in all the circumstances.
Whether the force used can be considered reasonable is decided according to the circumstances and the danger that the householder perceived him or herself to be in. The beauty of that law is the fact that it is so open, because circumstances change and one looks at the circumstances of each case. We have heard about someone having his ear sliced off and I can tell hon. Members about a case I defended in which, in a public house in north Wales, two families who were not very friendly met up. One was a family of poachers and the other of gamekeepers. Three members of one family jumped on top of one member of the other family in the toilets and the only way in which the lad, who was by himself, felt he could defend himself was by squeezing one of the others’ testicles in the most awful way. It left some permanent damage by the way, so it was not altogether a laughing matter—certainly not for the man involved. Anyway, the question for the court was whether the force used there and then was reasonable in all the circumstances and the court said, yes. So every case is decided on its merits; that is the beauty of the law of self-defence.
I deduce therefore that the only possible justification for the change is to provide some form of clarification and/or, possibly, that somebody is addressing somebody outside. Section 76 of the Criminal Justice Act 2003 clarifies the operation of the common law and section 3 defences as listed in the 1967 Act. The 2003 Act did not change the current test that allows the use of reasonable force and neither, I suspect, will new clause 27.
Nor, indeed, can the Government argue that the law surrounding reasonable force is badly understood by the judiciary—professional or lay. The existing position with regard to property is set out clearly in layman’s terms in the CPS guidance “Self-defence and the prevention of crime”. It says:
“Reasonable force. A person may use such force as is reasonable in the circumstances for the purposes of: self-defence; or defence of another; or defence of property; or prevention of crime; or lawful arrest.
In assessing the reasonableness of the force used, prosecutors should ask two questions:
was the use of force necessary in the circumstances, i.e. Was there a need for any force at all? and
was the force used reasonable in the circumstances?”
The existing law works well and is well understood; 99% of the time it is well applied in courts and I do not know of any great tide of concern that the law needs further clarification.
Mr Cox
Of course I agree with almost every word that the right hon. Gentleman is saying, but does he not agree that if the Government first enact section 76 of the Criminal Justice and Immigration Act 2008 they might as well make it complete by including the defence of property? If they are going to bother with section 76 at all, they should make it complete and include the defence of property.
Mr Llwyd
I hear what the hon. and learned Gentleman says, and I suppose that that is right, but I come back to my earlier point that the whole process is otiose. I understand what he is saying, and he has logic on his side. We talk about logic, but parliamentary time is short. Yesterday we had to leave out consideration of a raft of important matters relating to social welfare and social justice. None of them was discussed. Yet we have time this evening to talk about something that is unnecessary. So although I respectfully disagree with the hon. and learned Gentleman, he has logic on his side. However, the new clause is not the right vehicle for clarification of the law.
Quite why the measure is being introduced now is rather baffling. I can only presume that it is to please the tabloids and that this Government, like the last, want to convince voters that they are not soft on crime. Those on the right of the Justice Secretary’s party have made clear their aspirations to amend the law on reasonable force for some time now. As far back as 2009, the then shadow Home Secretary, the right hon. Member for Epsom and Ewell (Chris Grayling), said that any future Conservative Government would push for prosecutions, and convictions, only where courts judged that the action taken had been “grossly disproportionate”. That would have stood the law on its head. A huge amount of jurisprudence would have emanated from that decision. No doubt the hon. and learned Member for Torridge and West Devon (Mr Cox) and I would have profited from it, but it would have been a bad step in my view. The Conservative party wound back somewhat after that was said.
I am glad that such an extraordinary change to the law has not occurred, at least not yet. As Michael Wolkind QC, who represented Tony Martin, who was found guilty of murder and wounding with intent under the existing law, has said, allowing householders to use force that is not “grossly disproportionate” would amount to “state-sponsored revenge”.
Indeed, an outsider looking in might be forgiven for suspecting that hundreds of people were being prosecuted every year under the current law. But an informal trawl by the CPS suggested that between 1990 and 2005 there were only 11 prosecutions of people who had used force against intruders in houses, commercial premises or private land. So that is what we are dealing with and it leads one to question why we are talking about it tonight.
As the chair of the Bar Council Paul Mendelle QC said—it has been mentioned by the right hon. Member for Tooting (Sadiq Khan), but it will stand repetition—
“The law should always encourage people to be reasonable, not unreasonable; to be proportionate, not disproportionate.”
Paul Mendelle also commented in the same article written in The Times that the present law worked well and was well understood by juries. Again, I ask why we are doing this.
Changes to the law should not be brought about to produce good sound bites. The common law of self-defence already makes it perfectly clear that a householder is able to use reasonable force against an intruder in defence of himself or herself or his or her property. Amending the existing law for no gain in matters of substance will serve only to increase vigilantism and is not a good use of parliamentary time. It could lead to people using excessive force because they think they might be above the law—“An Englishman’s home is his castle” and all that kind of thing. I do not know. It might give out all the wrong signs, not the signs that Ministers on the Treasury Bench hope and suspect they are giving out.
I believe that the new clause has more to do with internal party politics than with policy. We are using valuable parliamentary time to play this out. The amendment is otiose and serves only to play to the drum beat of the tabloid press. I have a lot of time for the Justice Secretary, who is a man of great integrity, but I fear that in introducing the new clause he is dancing to the tune of the tabloids.
Mr Blunt
I will turn to the remarks of the right hon. Member for Dwyfor Meirionnydd (Mr Llwyd) towards the end of my speech, but first let me say how grateful I am to the right hon. Member for Tooting (Sadiq Khan) for his kind personal remarks. I was marginally upset that I did not leap the amorous threshold that my right hon. and learned Friend the Justice Secretary did, but I am grateful for the limited extent of his affection compared to that for my right hon. and learned Friend.
I was amazed at the chutzpah of the right hon. Member for Tooting in lecturing the Government about a public relations stunt and spin. It took me a moment to pick my jaw back up off the Bench as I listened to him. There is a clear answer to the right hon. Gentleman. He properly stood up for the legal system as it now sits. As my hon. and learned Friend the Member for Torridge and West Devon (Mr Cox) said, it is an inconsistent message if we have changed section 76 of the Criminal Justice Act but have not applied it to property, so let us make the position absolutely clear to everyone that not only in the code for crown prosecutors and in the common law but in statute law, as passed by the House, property is included. That is a clear reason for making this change.
The right hon. Gentleman said that presumably the change was for an audience outside the Chamber. Yes, it is. It is all very well for sophisticates such as us, who understand the word “otiose”—used by the right hon. Member for Dwyfor Meirionnydd (Mr Llwyd)—but the issue goes right to people’s hearts. They feel that they are entitled to defend their home or their shop, and we owe it to them to make it crystal clear that we absolutely support them in defending themselves, their families and their property. The proposals make that absolutely clear. We need to understand that when something is so central to how everybody feels about their home, shop or place of business we must send a clear signal from this place about whose side we are on.
Sadiq Khan
I am sorry to interrupt the Minister’s flow, but I have a simple question. Once the law is on the statute book, will a home owner have more rights, fewer rights or the same rights as they have now?
Mr Blunt
The home owner will have much greater reassurance about exercising their rights. [Interruption.] It is all for well for the lawyers on the Opposition Benches to cackle and say that the provision will not make any strict legal difference; it makes a profound difference in the reassurance that people will feel about operating in defence of their property and their life, which is why I am happy to commend the new clause to the House.
Question put and agreed to.
Clause read a Second time and added to the Bill.
New Clause 26
Offence of squatting in a residential building
‘(1) A person commits an offence if—
(a) the person is in a residential building as a trespasser having entered it as a trespasser,
(b) the person knows or ought to know that he or she is a trespasser, and
(c) the person is living in the building or intends to live there for any period.
(2) The offence is not committed by a person holding over after the end of a lease or licence (even if the person leaves and re-enters the building).
(3) For the purposes of this section—
(a) “building” includes any structure or part of a structure (including a temporary or moveable structure), and
(b) a building is “residential” if it is designed or adapted, before the time of entry, for use as a place to live.
(4) For the purposes of this section the fact that a person derives title from a trespasser, or has the permission of a trespasser, does not prevent the person from being a trespasser.
(5) A person convicted of an offence under this section is liable on summary conviction to imprisonment for a term not exceeding 51 weeks or a fine not exceeding level 5 on the standard scale (or both).
(6) In relation to an offence committed before the commencement of section 281(5) of the Criminal Justice Act 2003, the reference in subsection (5) to 51 weeks is to be read as a reference to 6 months.
(7) For the purposes of subsection (1)(a) it is irrelevant whether the person entered the building as a trespasser before or after the commencement of this section.’.—(Mr Blunt.)
Brought up, and read the First time.
Mr Deputy Speaker (Mr Nigel Evans)
With this it will be convenient to discuss the following:
Amendment (a) to new clause 26, line 7, at end insert—
‘(2A) The offence is not committed where the building has been empty for six months or more and where there are no significant steps being taken to refurbish, let or sell the building at the time of the trespass.’.
Amendment (c) to new clause 26, line 22 leave out subsection (7) and insert—
‘(7) For the purposes of subsection (1)(a) no offence is committed if the person initially entered the building as a trespasser before the commencement of this section.’.
Government amendment 140
Mr Blunt
The Government are very concerned about the harm that squatters can cause. Residential and non-residential property owners have contacted Ministers repeatedly about the appalling impact that squatting can have on their homes and businesses. These are not media scare stories; they are very real and stressful events for victims whose properties have been occupied.
It is not just a question of the cost, length of time and incredible hassle involved in evicting squatters. Properties can be left in a terrible state after the squatters have been evicted and owners may face hefty cleaning and repair bills. While the property owner is literally left picking up the pieces, the squatters have gone on their merry way. They might even be squatting in somebody else’s property.
The current law already offers some protection to both non-residential and residential property owners. Squatters may be guilty, in certain circumstances, of offences such as criminal damage and burglary. There is also an offence under section 7 of the Criminal Law Act 1977 that protects certain residential property owners. It applies when a trespasser fails to leave residential premises on being required to do so by or on behalf of a “displaced residential occupier” or a “protected intending occupier.” This means that people who have effectively been made homeless by squatters can ask the trespasser to leave, and if the trespasser refuses to leave, they can report an offence to the police.
We do not think the existing legal framework goes far enough to tackle the problems I have just described. The offence under section 7 of the 1977 Act does not protect non-residential property owners or many residential property owners, including landlords, local authorities and second home owners, who cannot be classified as displaced residential occupiers or protected intending occupiers. Following the conclusion of a recent public consultation exercise, we have decided that decisive action is needed now to criminalise squatting in residential buildings. We want to reassure owners and lawful occupiers of residential property that the law will protect them should trespassers occupy their properties. We want to send a clear message to would-be squatters that it is simply not acceptable to occupy someone else’s home.
Tracey Crouch (Chatham and Aylesford) (Con)
I am sure the Minister will recall that a year ago tomorrow he met my constituent Steve Cross, a commercial property manager. The Government are clearly concerned about the impact of squatting in commercial property, so it is surprising that the new clause, which I entirely support, does not include greater protections for commercial properties. Will the Minister reassure my constituent that the Government have not forgotten the devastating impact of squatting on commercial property managers, and that they will continue to look at ways of strengthening the law to provide greater protection against squatters in commercial properties?
Mr Blunt
I am grateful to my hon. Friend for her intervention and for bringing her constituent to see me. I absolutely give her that reassurance, and I will do so in terms during my prepared remarks, which I hope will show her that I have not forgotten that the consultation identified the fact that 50% of the harm caused by squatters was to the owners of commercial premises. Although we are not proposing to criminalise such squatting with these measures, it is certainly not forgotten.
We recognise that this is a controversial area of policy. Many homelessness charities, for instance, are likely to continue to say that the new offence will criminalise homeless and vulnerable people who squat in run-down residential properties, but one of the reasons that the properties remain in that state is that the owners cannot get in to renovate them because the squatters are present. Consultation responses indicated that squats can be unhygienic and dangerous places to live and are no place for genuinely vulnerable people. That is why we will ensure that reforms in this area are handled sensitively, in conjunction with wider Government initiatives to tackle the root causes of homelessness. We are also working to provide affordable homes and to bring more empty homes back into use.
Jeremy Corbyn (Islington North) (Lab)
The Minister will, like me, have read the documents presented by Crisis, which indicate that 40% of homeless people have been squatters at some time, and that because they are often single people, they have great difficulty in getting local authority or housing association accommodation, and there are 700,000 empty properties in the country. What are homeless people supposed to do?
Mr Blunt
I will deal with the amendments tabled by the hon. Member for Hayes and Harlington (John McDonnell), who has quite properly raised concerns in this area, and I will go into some detail to give the hon. Member for Islington North (Jeremy Corbyn) a proper answer to his question.
As my hon. Friend the Member for Chatham and Aylesford (Tracey Crouch) said, there are others who will say that any new offence should extend to squatting in commercial premises. As I said to her, I remain concerned about squatting in those properties and will work with other Departments and the enforcement authorities to see whether action against existing offences such as criminal damage and burglary could be enforced more effectively in those cases.
The Metropolitan police acknowledged, in response to our consultation, that a lack of training and practical knowledge regarding the law on squatting may be a barrier to effective enforcement. My officials will work with the Home Office and the wider police service to address these issues and fill any gaps in current police practice. We will keep the situation under review in relation to non-residential property and are not ruling out further action in the future if it is needed.
Jim Shannon (Strangford) (DUP)
Will the legislation provide for co-operation or contact with services—electricity, water and so on—to those houses as a method whereby people can be taken out of those houses to ensure that the squatting does not continue? Will that be covered by the legislation?
Mr Blunt
That is not strictly within the terms of what is proposed here. The effect would be to criminalise those who are squatting in residential premises and to create a new offence. As a first step we intend to limit the new offence to squatting in residential buildings. We consider that this option strikes the best balance. It will protect those who are likely to suffer most from squatting—those whose homes are taken over by squatters.
I shall turn now to the amendments tabled by the hon. Member for Hayes and Harlington. I know that he is a supporter of the campaign group Squatters Action for Secure Homes, and I also know that he agrees with the arguments put forward by homelessness charities, such as Crisis, that criminalising squatting will impact on homeless people who squat. I fully understand why he tabled the amendments, but I will take this opportunity to explain why I do not agree with them.
On amendment (a), many squatters claim that they do not cause any harm to anybody because they look for empty properties to occupy. In the responses to our recent consultation exercise, that point was made by squatters and squatters groups, but respondents who made that argument were missing one rather important point: the houses are not theirs to occupy. There are many reasons why a house might be left empty for more than six months without any steps being taken to refurbish, let or sell the building. For example, somebody might decide to do charitable work in another country for a year, or they might visit their second home during the summer months only. It is the owner’s prerogative to leave the house empty in those circumstances. To say that property owners or occupiers should not be protected by the criminal law in these circumstances would be unjust and it would considerably weaken our proposed new offence.
Consultation responses highlighted a concern about the number of properties that are left empty on a long-term basis. They argued that such properties can crumble into disrepair and might be seen as a blight on the local neighbourhood. But permitting squatters to occupy derelict, crumbling, unsafe houses cannot be the answer. We are doing a number of things to encourage absent owners to make better use of their properties.
We want to increase the number of empty homes that are brought back into use as a sustainable way of increasing the overall supply of housing, and to reduce the perception of neglect that can blight neighbourhoods. Reducing the number of empty homes will also help to reduce the incidence of squatting. That is why we have announced £100 million of capital funding within the affordable homes programme to tackle problematic empty homes—that is properties that are likely to remain empty without extra direct financial assistance from the Government. This programme will deliver at least 3,300 affordable homes by March 2015, as well as engaging local communities in dealing with empty homes in their area.
Amendment (c) is designed to exempt squatters from the offence if they occupy residential buildings before the date of commencement. Let me be clear that we have no plans to punish people retrospectively. If they have squatted in the past but are no longer squatting when the offence comes into force, the offence will not apply. However, we would be creating a significant loophole if we exempted squatters who initially entered the building as a trespasser in the run-up to commencement even though after commencement of the offence they remain in the building as a trespasser, they know or ought to know that they are a trespasser and that they are living there or intend to live there. Such an occupation would be no less painful for the property owners concerned.
I appreciate that the hon. Gentleman and others are concerned that the new offence might penalise vulnerable, homeless people who squat in run-down residential properties. One of the reasons they remain in this state is, as I said, because the owners cannot get in to renovate them. It would be much better for us to introduce an offence that is capable of protecting law-abiding property owners and occupiers on the one hand, while working with other Government Departments, local authorities, the police and homelessness charities to continue to address the root causes of homelessness and to mitigate any impacts the new offence might have on the levels of rough sleeping.
We are prioritising spending on homelessness prevention, investing £400 million over the next four years, with the homelessness grant being maintained at the 2010-11 level. For the first time, we have also brought together eight Departments through the ministerial working group on homelessness to tackle the complex causes of homelessness. The group published its first report “Vision to end rough sleeping” in July 2011, which sets out joint commitments to tackle homelessness and to ensure that nobody has to spend more than one night out on our streets—“No Second Night Out”. This includes actions to prevent homelessness for those people without a stable home who may be at risk of rough sleeping. For those reasons, I invite the hon. Gentleman to withdraw his amendments.
Caroline Lucas (Brighton, Pavilion) (Green)
It feels as though we are in a different world when the Minister describes these as measures to tackle homelessness and when one considers everything that the Government have been doing with their housing benefit cuts and with their cuts in shared room rate, which organisations say will cause thousands more people to become homeless. Is he not cognisant of those arguments being put forward very forcefully by those charities?
Mr Blunt
I absolutely support the measures being brought forward by my colleagues at the Department for Communities and Local Government. The Minister for Housing and Local Government is absolutely right. One cannot but be impressed by his huge determination in chairing the ministerial group to address this issue. It is the other side of the equation, and I hope that it addresses the amendments and answers the question from the hon. Member for Islington North.
The hon. Member for Strangford (Jim Shannon) asked about linking up with the utility providers. It is already an offence under the Theft Act 1968 to use electricity without authority and the maximum penalty for that is five years’ imprisonment.
I hope that the House will welcome this move to protect home owners and lawful occupiers of residential property from squatters.
Mr Slaughter
It is pleasure to have the Under-Secretary of State for Justice, the hon. Member for Reigate (Mr Blunt), at the Government Dispatch Box this evening. It is a shame that the Lord Chancellor is not here, but of course he was also absent when the provision was announced by the Prime Minister at the famous press conference on 21 June, when most of today’s business first saw the light of day, including the clause we have just debated. At times it appears that there is a parallel Bill: the agenda that the Government wish to present to the media, or which the media dictate to the Government.
Sadly, the consequence for the House is that we do not have the opportunity to scrutinise the legislation properly. I do not know whether that is because the Government have no confidence in or commitment to their own legislation and are simply going through the motions, as we saw a little while ago, but the process of formulating the policy has been absurdly rushed, even by their standards. It is wholly inappropriate to introduce major changes to criminal law on Report. For that reason, among others, I suspect that the provisions will have a rather more torrid time in the other place than they will have here tonight.
Squatters are a nightmare for homeowners and tenants alike. The Criminal Law Act 1977, which the Minister mentioned, makes it a criminal offence for any person not to leave premises when required to do so by “a displaced residential occupier” or “protected intending occupier” of the premises. Furthermore, parts 55(1) and 55(3) of the Civil Procedure Rules allow owners to evict someone from a residence they do not occupy. An interim possession order, backed up by powers in section 76 of the Criminal Justice and Public Order Act 1994, mean that a criminal offence is committed if an individual does not leave within 24 hours of such an expedited order being granted.
As the Minister confirmed in his opening remarks, new clause 26 seeks to deal with squatting in vacant properties for which there is no imminent plan for residency. The clause, as drafted, applies only to residential properties and will not apply where there has been a previous landlord and tenant relationship between the occupier and the owner. Those are not the cases that typically attract the media’s attention. For example, the case of Dr Cockerell and his wife, who was pregnant at the time, was widely reported this September, in the Evening Standard and other newspapers. In that case the police wrongly said that the case was a civil issue and not one for them. As I understand the facts as reported, Dr Cockerell and his wife would have been protected intending occupiers and the police should have intervened. I fear that their failure to do so is not atypical. I remarked in Committee that if we had a pound for every time the police said that something was a civil matter when someone goes to them, we would probably be able to build affordable housing in the country, unlike what the Government are doing. I worry that the Government are trying to introduce new legislation without implementing the legislation that already exists, which is clearly the case in the examples I have given so far.
Jeremy Corbyn
My hon. Friend is old enough to recall the lengthy consultation that took place before the 1977 Act was introduced. It specifically distinguished between an occupied property and a property that had been left empty for a very long time. The issue at the time, particularly in London, was that vast numbers of empty properties were being squatted. That law was a product of consultation. There has been no consultation on this—[Interruption.] Well, there has been very limited consultation, but certainly not in the House, about criminalising people who are actually extremely desperate for all the reasons pointed out by my friend the hon. Member for Brighton, Pavilion (Caroline Lucas).
Mr Slaughter
I think I was doing my politics A-level at the time, so I might have studied the Act as part of that. My hon. Friend makes an important point about housing need that the Minister, to be fair to him, also addressed, and I will move on to that in a moment. I will not say what grade I got in my politics A-level—[Interruption.] Let us just say that it probably would not impress the Education Secretary.
We share the anger of people whose properties are damaged or vandalised by squatters. That is always wrong, and it is right to decry such behaviour. It is also right to say that there are, for want of a better term, lifestyle squatters—people who are part of the something-for-nothing society. We disagree with that, and we support the criminalisation of their activities. However, many squatters are homeless, and often have severe mental health or addiction problems.
It may be a sign of the Government’s topsy-turvy logic that in one part of the Bill, which we support, they seek to divert those with mental health and drug problems from the criminal justice system, but this part may criminalise those very people. At the same time, we are seeing some of the most swingeing benefit cuts in history. Housing benefit has been mentioned. In constituencies like mine, thousands of families will be forced to move because of the cuts in housing benefit, or may lose their properties. Incompetence by the Department for Work and Pensions and its private sector agents, such as Atos Healthcare, is causing a rise in poverty and homelessness. We are seeing a massive increase in appeals on welfare benefits, and 170 extra staff have been hired by first-tier tribunals to deal with those appeals, many of which are successful. That is one reason why we oppose the Government’s proposals on social welfare legal aid.
I wish that yesterday we had had the luxury that we have today—a timetabled programme with knives to grandstand some of the Government’s proposals. The House is thinly attended and the debate is frankly low key, whereas yesterday the Government engaged in talking out important measures on which many hon. Members wanted to speak. I noted what the Secretary of State, or it may have been the Under-Secretary of State for Justice, the hon. Member for Huntingdon (Mr Djanogly), said about our debates tomorrow. I hope that we will have the debates that we want tomorrow, including those on part 2, and that Government Whips will not employ their tawdry tactics again.
Some 40% of homeless people have squatted, as my hon. Friend the Member for Islington North (Jeremy Corbyn) said, and 6% of homeless people are squatting at any one time. There is a significant prevalence of mental health problems, learning difficulties and substance addiction in those who are homeless.
This afternoon, I opened a new project for homeless people in my constituency. Very experienced people from organisations for the homeless—they were not trying to be party political in any way—asked me a question that I could not answer. They said that the Work and Pensions Secretary talks about an underclass, or a feral class as the Justice Secretary also said, and says that the Government want to take action to help problem families and to relieve poverty at the bottom of society, so why do they wish to take measures that could criminalise those same people?
The Government are clearly being tough on squatting, and we have no objection to that, but they are being incredibly weak, contrary to what the Minister said, on the causes of squatting. In fact, their impact assessment gives a hint of who the people are who often end up squatting. It says:
“Local authorities and homelessness…charities may face increased pressure on their services if more squatters are arrested/convicted and/or deterred from squatting. Local authorities may be required to provide alternative accommodation for these individuals and could also face costs related to increases in rough sleeping in their areas. An increase in demand for charities’ services (food/shelter etc.) may negatively impact current charity service users…There may also be a cost to society if this option is perceived to”
be
“unfair and/or leads to increases in rough sleeping.”
The pièce de résistance is:
“It has not been possible to quantify these costs.”
The Government accept that there will be pressure on services, but say that they cannot quantify the cost. Why? They do not know how many people squat. I believe—the Minister will no doubt correct me if I am wrong—that the civil servants have used figures from squatters’ organisations to estimate how many squatters there may be. The Government’s estimate is that there are between 340 and 4,200 criminal squatting cases across England and Wales, and that the Crown Prosecution Service will charge between 850 and 10,600 offenders.
The Government accept in their response to the consultation that
“as with any criminal offence there would be an operational discretion as to whether a person should be charged with an offence.”
I think that goes without saying, but they say it in particular with respect to hikers who take refuge in a house to take shelter from the elements. [Interruption.] I am glad that the Government Whip, the hon. Member for Lichfield (Michael Fabricant), is interested, and I will say a bit more about that. It is a problem that the Government see as a possible unintended consequence of the new legislation. They state:
“The Government accepts that hikers who occupy a residential building in these circumstances might be committing an offence as a result of its proposals. In practice, however, it seems unlikely that the property owner would make a complaint”,
so that is all right. They continue:
“Even if a complaint were made, as with any criminal offence there would be an operational discretion as to whether a person should be charged with an offence. The Government considered creating a ‘reasonable excuse’ defence to allow for this type of situation, but was concerned that such a defence would be open to abuse and might render the new offence toothless.”
I have seen some pretty shoddily justified legislation in my time, but that really is an “on the one hand, on the other hand” explanation.
I hope that at the very least the Minister will tell us whether his intention is to apply the discretion that he wishes to see applied to hikers, an important category of citizen, to those who occupy empty properties out of desperation—the people the Government’s own impact assessment states would now have to resort to sleeping rough. They could include people with mental health or addiction problems whom it may be more appropriate to treat than to detain in jail. I have heard the Minister make that argument in another context in Committee. I note that this farrago and confusion would not have happened had the appropriate parliamentary process been followed.
It is common practice in a Second Reading debate—this increasingly feels like Second Reading, when we see measures for the first time and pass general comments on them—for a proposal that has some merit but needs refinement to be allowed through. That is what we intend to do today. We support the idea that there may be categories of squatters who need to be criminalised, although we say that the current criminal law is not being properly used in that respect.
I hope that the Minister will not think that our decision to allow matters to proceed is an unthinking endorsement of his position. Those who think squatting an acceptable lifestyle choice should be under no illusion about the fact that we disagree, and we support the criminalisation of what is, frankly, arrogant behaviour. For that reason, we believe it is right to allow the matter to be scrutinised in another place. However, there remain issues to consider and more thought and deliberation to be done before the new clause reaches the statute book.
I hope that the Government will at the very least consider the issues that I have raised today, and those that other hon. Members will no doubt raise, and keep them in mind when they feel the endorphin rush of a few cheap tabloid headlines again. I hope that they will think seriously about all the implications of the new clause and come up with something a little clearer, better defined and less vague.
The Minister will no doubt say that I am giving less than wholehearted support. Not true. We support the Government’s intention, but we believe that because they have once again rushed matters towards the statute book, they have not given them proper and clear consideration thus far. Once again, they leave it to another place to do that.
Mike Weatherley (Hove) (Con)
Today is a good day for the law-abiding citizens of this country and a bad day for those wanting something for nothing. Since my election nearly 18 months ago, I have been campaigning to criminalise squatting, including in an excellent Westminster Hall debate with the Minister about a year ago. I congratulate the Government on tabling the new clause.
I wish to dispel once and for all the myth that squatters and homeless people are one and the same. My Hove and Portslade area contains both wealth and deprivation. It is a Mecca for every character imaginable, and that is what makes it such a wonderfully diverse place to live. Homelessness is an issue, and we have a fantastic support network of local charities, including Emmaus, Brighton Housing Trust, the YMCA and Off the Fence, which looks after a great number of vulnerable people through Project Antifreeze—indeed, I will visit Off the Fence again this Friday. It is our duty to look after homeless people. I fully support all the excellent work being done and the Government’s commitment to do even more.
John McDonnell (Hayes and Harlington) (Lab)
I want to follow on from the previous debate and the discussion of the method of making legislation. Making new laws, especially ones that can put people in prison for up to a year, is an extremely serious matter, so judgment cannot be undertaken or driven by anecdote, prejudice or media headlines.
There are questions that have to be considered for wise judgment. What is the problem to be addressed? Is it real? What is the scale of the problem? Is there an existing law, and if so, is it defective in a way that renders it ineffective? If we are to make legislation of this sort, what are the consequences of creating a new crime for the people seeking a remedy in this way and for those who will be brought into the criminal justice system? What are the consequences and implications for the resources, operations and standing of the law enforcement agencies and our communities overall? Finally, during my years in the House, I have learned another key question: will it cause more problems than it seeks to cure?
Is there a significant problem with squatting in residential properties? To be frank, the evidence produced by the Government so far has not demonstrated this. There have been some highly publicised cases in the media and statements by MPs and Ministers, but no hard evidence. The Government’s consultation paper acknowledged the lack of statistical evidence. For instance, the equality impact assessment states that
“there is no consensus on the true extent of squatting, or the proportion of squatting that is in residential buildings.”
Based on a number of assumptions—I agree with my hon. Friend the Member for Hammersmith (Mr Slaughter) that many of them were supplied by squatters themselves or housing campaigning associations—the Government estimate that there might be between 200 and 2,100 criminal squatting cases in residential properties across England and Wales. That is a tenfold range, demonstrating the inexact nature of the Government’s evidence.
In the response to the Government’s consultation, only seven victims of squatting in residential properties came forward. The lack of evidence has led the Law Society to object to changes in the law that are not evidence-based and the Magistrates Association to express its reluctance to see new laws created without proper analysis. This is the first time that I have been in alliance with the bench.
Is the current law defective? Even if only a small number of people are affected, it is right that we sympathise with them and ensure that action is taken to protect them. If the law is defective or lacking, there should be a remedy, but most legal authorities that commented during the consultation felt that the existing law was sufficient. As has been said, under existing law, it is already a criminal offence for a squatter to refuse to leave someone’s home or a home that they are about to move into.
Mike Weatherley
Would the hon. Gentleman not agree that the squatters should not be there to start with?
John McDonnell
I shall move on to that; I understand the hon. Gentleman’s point.
Under section 7 of the Criminal Law Act 1977, it is already an offence for any person on a residential premises not to leave
on being required to do so by or on behalf of…a displaced residential occupier…or…protected intending occupier”.
According to the response to the consultation, the Metropolitan police said that
“the law was broadly in the right place and that the existing array of offences allowed them to tackle the worst cases of squatting (e.g. where squatters cause the rightful homeowner to be displaced).”
The Law Society and the Criminal Bar Association confirmed the same view. The Law Society stated:
“The consultation paper acknowledges that there are no reliable data on the nature and extent of squatting. In the absence of any such evidence, we have no reason to believe that the existing law does not deal adequately with squatting.”
It went on to describe the operation of section 7 and confirmed that no evidence had been produced to demonstrate that it did not work adequately when properly used. Those concerns were confirmed by the Criminal Bar Association.
The Law Society reported that section 7
“is not often used, as squatting happens infrequently, but where it is our members”—
that is, the lawyers concerned—
“report that it is extremely effective.”
These are the responses to the Government’s own consultation.
Everyone in the House has to support evidence-based policy making. From all the evidence and information to hand, including from the Government’s own consultation and impact assessment, we must conclude that there is no evidence of a problem on any significant scale, that there is conjecture that it exists and that in the judgment of practitioners—not just the advocates, but the law enforcers—the existing law is sufficient.
Tracey Crouch
Does the hon. Gentleman not consider that one of the flaws with the current legislation is section 6 of the 1977 Act, which allows squatters to claim rights to a property, thereby making it difficult for owners to get rid of them?
John McDonnell
I cannot accept that when section 7 enables people to request squatters to leave. If they do not, they are committing a criminal offence, and the law should be enforced by the police under existing legislation.
John McDonnell
The point made by most people in the consultation, including the police, is that if elements of section 7 need tidying up, there should be a proper discussion about that. However, to criminalise an entire group in society is to over-react to a problem that is relatively minor, although I do not wish to underestimate the problem that appears to be caused to some home or property owners.
Jeremy Corbyn
Will my hon. Friend inform the House exactly when new clause 26 was published and how long people have had to comment on it, including those from the Law Society and elsewhere?
John McDonnell
I will come to that, because we need to learn lessons across the House about the appropriateness of how we have legislated in recent years. I have sat in this place and seen bad law produced as a result of rushing things—it happened under the last Government and it is happening under this one—and a lack of judgment about how much consideration each piece of legislation needs.
John McDonnell
I will, but I would like to press on, because others want to speak.
Kelvin Hopkins
Is there not a hint of short-term populism in what the Government are doing? Does my hon. Friend think that even the Government might come to regret it if they press their case?
John McDonnell
I went through 13 years of new Labour, so commenting on short-term populism might not be the most appropriate thing. I would not say: “A plague on all your houses!”, but let us all learn a few lessons.
Andrew George (St Ives) (LD)
Just so we are clear about the hon. Gentleman’s position, does he agree that it is unacceptable for anyone to be made homeless as a result of the kind of actions that we are talking about? Does he also agree, as a consequence, that passing new clause 26 in its current form would place an additional burden on the legal aid budget?
John McDonnell
I wholeheartedly agree.
Let me press on, because others want to speak. Clearly there are a small number of cases, which we have already identified, that have caused genuine concern. The problem appears to be not with the existing law, but with its operation, as the consultation has made clear. Annington Holdings plc, a property holder of considerable size, said:
“In Annington’s experience enforcement is the crux of the problem; our past experiences have shown that delays arise in removing squatters from properties due to limitations on police resources.”
If the current problem is with police resources, the question—which has been raised by the High Court enforcement officers, the Criminal Bar Association and the Law Society—is whether the police would have the resources to enforce the law if a new offence is created, when they appear to be unable to enforce it against the existing offences. The Met has acknowledged that and is seeking to address it, as my hon. Friend the Member for Hammersmith and the Minister have said. The Metropolitan Police Service said in its statement that there was a lack of training and practical knowledge on the law on squatting, particularly section 7 of the 1977 Act, which may be a barrier to effective enforcement, and that it was conducting further training to address the issue.
By criminalising squatting, the new clause certainly does not appear to be needed, but it will have consequences if introduced, some of them unintended. The new law will have consequences for those who will be brought into the criminal justice system for the first time, and it is worth repeating who those people are likely to be. The housing charity Crisis commissioned research into squatting from the centre for regional, economic and social research at Sheffield Hallam university, which was published only a month ago, in September. It found that, by and large, squatters were homeless people. The House of Commons Library note sets out for Members that
“squatting is a common response to homelessness”,
and that
“most homeless people who squat try other avenues to resolve their housing problems before squatting”
Kate Hoey (Vauxhall) (Lab)
I entirely support what my hon. Friend is saying. Does he agree that this will be particularly bad law because it is going to be retrospective? It will apply to people who are squatting at the moment, and who thought that they were doing so legally. The House should not be pushing through this legislation in this ridiculous way, without scrutiny.
John McDonnell
I believe that it will damage a large number people’s lives, some of whom are squatting at the moment for no other reason than that they are homeless. They will be criminalised by this retrospective legislation, which is something that I thought Members of all political parties across the House had rejected.
What will be the effect of the new law on squatters’ lives? We know that many, although not all, vulnerable people live chaotic lives. They will be fined up to £5,000 or face up to a year in prison. Not many will have the resources to pay the fine, so prison will be a reality for a significant number of them. I have heard no estimate from the Government of the extent to which this will swell prison numbers. I fear that people will be drawn into a cycle of squatting and going to prison. One third of people coming out of prison have no home to go to, so they will get back into the squatting cycle.
I hope that the House will not pass the new clause into law, but if it is determined to do so, I have tabled amendments to ameliorate its impact. Amendment (a) would provide that squatting remains a civil matter in all residential buildings that had been left empty long term and were not being brought back into use. This would ensure that residential buildings that had been lived in recently or that were being brought back into use would be covered by the criminal law. That includes the question of refurbishment that was raised earlier.
I have looked at the statistics cycle over the past five years and found that, on average, between 650,000 and 700,000 residential properties stood empty during that time. Most are private properties, and 300,000 have been empty for more than six months. When there are 40,000 homeless families, 4,000 people sleeping rough in the capital, and 1.7 million households on waiting lists, desperate for decent accommodation, it is immoral that private owners should be allowed to let their properties stand empty for so long. My amendment could force those irresponsible owners to bring their properties back into use. More importantly, it would mean that desperate people who need a roof over their heads would not be criminalised for resorting to occupying a property that was being wasted by its owner.
It is not for me to criticise the Speaker, of course, but I regret that my amendment (b) was not selected. I had hoped to try to persuade the House to protect the most vulnerable people in our society from being dragged into the courts, but I am sure that there were good reasons for not selecting it, and perhaps it will be debated in another place.
My amendment (c) would address the fact that the present wording of the new clause criminalises those who are currently squatting in a residential building. It is one of the principles of good government that retrospective legislation is unjust. I should like to quote from article 11, subsection 2, of the universal declaration of human rights:
“No one shall be held guilty of any penal offence on account of any act or omission which did not constitute a penal offence, under national or international law, at the time it was committed.”
There is a basic injustice about retrospective legislation, and I hope that the House will accept that and address it at some stage in this Bill’s consideration.
Finally, there is a mounting housing crisis. I criticised the last Government as much as this one for their failure to address the supply of decent housing. We have got the return of appalling housing conditions in my constituency—overcrowding, high rents and the return of Rachmanite landlords. People are desperate and will resort at times to any means to put a decent roof over their and their family’s heads. Squatting is sometimes the only way. People should not be criminalised for wanting a decent home.
The new clause is being rushed through Parliament. The Secretary of State launched in July a consultation on a range of proposals to criminalise squatting. The consultation ended in October. More than 2,000 responses were received, 90% of them opposed to the Government’s proposals. Clearly, there has been no serious consideration of the consultation responses because the clause was brought forward only three weeks after the consultation closed. This is rushed legislation, and rushed legislation, as I have said, is generally poor or bad legislation. The consultation, if it had been properly taken into account, made it clear that the current laws were sufficient to deal with any abuse. Professionals, police and others have told us so. My fear is that we now risk putting people on the streets and possibly into prison because our society has failed to provide them with a decent home. If this clause goes through tonight, I believe that many will regret it.
I give notice that I wish to press amendment (a) to a vote.
Mr Deputy Speaker (Mr Nigel Evans)
Order. As Members can see, a considerable number still wish to participate in the debate. As we want to listen to the Minister and the knife falls at 10 o’clock, I call for brevity and short speeches.
Mike Freer (Finchley and Golders Green) (Con)
I commend the Minister for listening to our concerns and introducing these proposals. I also pay tribute to my hon. Friends the Members for Hove (Mike Weatherley) and for Bury North (Mr Nuttall), as we have been pressing the Government for action for some time. I am grateful to the Minister for his courtesy on this issue.
Labour Members commented that they did not see a need for this Bill, as they thought that there was some parallel Bill. I have to say, having listened to some Labour Members, that they seem to be living in a parallel universe. If there is not a squatting issue, why is it that three houses in my constituency were squatted in one week?
My concern is about the residential squatters and the homes they squat, which are often not derelict or abandoned properties. Those properties can be dealt with. Councils such as my own London borough of Barnet routinely issue improvement notices. If landlords do not bring the properties up to standard or back into use, they use the threat of a compulsory purchase order to bring the landlords back into line. On every occasion I have seen that used, the property has been refurbished and brought back into use. There are methods of dealing with abandoned and derelict properties without giving a charter for squatters.
The issue of residential squatters is not just one about mansions or large houses lying empty for year after year. The houses to which I refer in my constituency have been refurbished between purchase and occupation. These are houses that are going through probate or whose owners are on extended holidays. When the owners come home, they find their property occupied by somebody else, who is not necessarily homeless. As we have seen in the papers recently, it is often organised gangs that occupy family properties that are clearly occupied, clearly in use and clearly not abandoned.
I listened to what Labour Members said about squatting already being a criminal offence and the police having powers to deal with it. If so, why is it on every occasion in my constituency that the police have stood by and said, “Sorry, guv, but it is nothing to do with us; it is a civil matter”? The current law is defective; the current law needs clarifying; and these proposals do that.
I was intrigued to hear the argument that homelessness is some excuse for squatting. Is it okay for people to say, “I don’t have a house, so I’ll have yours. Thank you very much.”? I am not sure whether that is what Labour Members are genuinely saying.
We heard the argument that pennilessness is an argument for squatting. Is it also an argument for mugging? If I am penniless and go out and mug somebody, is that all right? Is that what Labour Members are really saying?
I have read the amendments, and I understand the problems of those who have been in shelters for the homeless or domestic violence refuges or have received mental health support. However, I also know that many people in need of mental health support squat not because they are not being given that support, but in order to evade the very support they need. If we can deal with squatting, those with mental health problems will have a better chance of benefiting from the intervention that they both need and deserve.
Hard-pressed taxpayers and home owners who have worked hard, have bought their houses and pay their mortgages are demanding change and protection. I support the new clause because it will provide the very necessary protections that those people require.
Mr Deputy Speaker (Mr Nigel Evans)
I thank the hon. Gentleman for his brevity.
Jeremy Corbyn
Like other speakers, I shall be as brief as possible, because a good many Members clearly want to say something about this issue. I commend the amendments tabled by my hon. Friend the Member for Hayes and Harlington (John McDonnell), the way in which he presented them, and the background information he provided.
New clause 26 first saw the light of day only a few days ago. This is effectively a Second Reading debate, but it provides the only chance that the House will have to discuss a major change in legislation that will result in criminalisation. I predict that in years to come, Government and, indeed, Opposition Members will complain that a person has been criminalised because they were homeless—that a person who occupied someone else’s house was put in prison for a year, which would cost the rest of the community about £50,000.
This country has a long and chequered history when it comes to squatting. It goes back to the Forcible Entry Act 1381, which became law during the Black Death. The issue has arisen time and again during periods of great stress: it arose at the end of the Napoleonic wars, at the end of the first world war and at the end of the second world war, when there was widespread squatting because of a terrible shortage of housing.
The Criminal Law Act 1977, which I mentioned in an intervention earlier, was introduced after a great deal of consultation by the then Labour Government. There was a fair amount of opposition to the legislation, which distinguished specifically between the act of taking someone’s house when that person was occupying it and the act of occupying a property that was being kept empty. The property might be empty as a result of the inefficiency of a local authority or housing association—or, in some cases, a charitable landlord—but more often it would be kept empty deliberately while a property speculator waited for its value to rise before seeking to possess it and sell it to someone else; and, at the same time, a large number of people were homeless on our streets.
Crisis and other charities have produced interesting statistics and arguments. It has been claimed that 40% of homeless people in the country have squatted at some point, and that because the housing crisis means that there will be more people on the housing waiting lists and more without access to houses, there is likely to be more squatting.
Let me tell the hon. Member for Finchley and Golders Green (Mike Freer) that it is very easy to stand up in the House and say that no one should ever occupy any empty property, but it is another matter for someone who is homeless, has applied for local authority housing but is deemed not to be vulnerable as a single person, and is therefore not eligible to be nominated for a council or housing authority property. Those who try to rent a property in the private sector anywhere in London will find that renting a one-bedroom flat costs a minimum of £150 to £200 a week, renting a two-bedroom flat costs £250, and renting a house costs between £400 and £500. When the very same Government who are lecturing someone about occupying a property that has been deliberately left vacant are preventing that person from obtaining housing benefit to pay such rents, what can the person do? It is all very well for us to lecture, but what can that person actually do?
I believe that the existing law can deal with most of the concerns that have been expressed. There are some cases in which people have behaved disgracefully and driven others out of their homes when they should not have done so, but the 1977 Act is designed to deal with such cases. They can be dealt with through selective, specific and well-thought-out legislation, rather than through the approach that is being adopted in the House this evening.
We shall press amendment (a), tabled by my hon. Friend the Member for Hayes and Harlington, to a Division. It covers only residential property that “has been empty for six months or more”. Parliament has a responsibility to recognise that there are 700,000 empty properties across the country and a very large number of people who are either homeless and sleeping on the street, sofa-surfing before they run out of friends entirely, sleeping in cars, or just trying to get somebody to put them up for a night before they move on. I assume all Members have met such people in their advice surgeries. What do we say to them? Do we say, “It’s your problem; you go and solve it,” or are we a society that tries to help everyone and make sure everyone gets somewhere to live and has a secure roof over their head?
Tom Brake
Squatting clearly has a devastating impact on private owners, and it can also have a devastating impact on councils. When I was a councillor in Hackney back in the late ’80s, it was eventually discovered that many council properties were squatted, and that in many cases council employees had sold the keys to the squatters. We clearly need to tackle squatting, therefore. I would have welcomed a fuller debate on the matter, however, and I now want to raise a few points that would, perhaps, have been more pertinently raised in Committee, if that stage had taken place.
The first aspect of new clause 26 on which I seek clarification is proposed new subsection (3)(b), which states that
“a building is ‘residential’ if it is designed or adapted, before the time of entry, for use as a place to live.”
Could a commercial building be so “designed” or “adapted”, and what would be required for that to be achieved? Would simply placing a bed in a commercial premises be enough for it to be “designed” or “adapted” as “a place to live”?
The second point on which I seek clarification relates to proposed new subsection (4) on the “permission of a trespasser”. If a person has not been informed by someone who is a trespasser that they are in a building that they are squatting, and that person then squats in that property, would they be guilty of the offence of trespass? I hope the Minister can provide some clarity on that point.
At the risk of the Opposition accusing me of trying to have my cake and eat it, I will say that the hon. Member for Hayes and Harlington (John McDonnell) has raised some interesting points in amendment (a). Setting a bar of six months would not be appropriate, however, because there are many circumstances in which people might legitimately choose to leave a property empty—for example, if they are abroad for a year. However, I am sure that every Member of Parliament here tonight probably has one, two, three or possibly more properties in their constituency that have been empty year after year—possibly for decades. I know for a fact that residents living on either side of such properties may prefer to have someone in them so that the property is not allowed to fall down, be taken over by foxes, have trees growing in the front room and so on. I accept that the difficulty lies in trying to distinguish between those cases and cases where a squatter takes advantage of a property. The amendment raises an interesting point and I hope that the Minister will be able to respond to it.
Nadine Dorries (Mid Bedfordshire) (Con)
Is the right hon. Gentleman truly saying that neighbours on either side of a property would prefer to have squatters in it than to have foxes in it or trees growing in it? Is that actually what he is saying?
Tom Brake
I think that the hon. Lady may, if she examines her constituency cases, find some examples where people are frustrated at the length of time—it could be years—that a property next to theirs has been empty and has been allowed to fall into disrepair, with all the environmental and other dangers associated with that.
Simon Hughes (Bermondsey and Old Southwark) (LD)
I just want to try to disabuse the hon. Lady of a simplistic view about this. The council had determined to knock down a block over the other side of the river—the Pullens estate in my constituency, which is a fantastic old estate—but it was squatted, as were some estates in Surrey Docks. Had that not happened, these places would have been demolished. They were squatted, they were kept, they have been refurbished, and they are now properly let and in use. So this is not nearly as simplistic as it has been made out to be, and often people would rather a property was occupied than sitting empty.
Tom Brake
I thank my right hon. Friend for his intervention, which provides its own explanation.
The final point that I wish to make is about the retrospective nature of the provision as, again, it is an area that the Government need to examine carefully. As we have not had an in-depth debate here tonight, I suspect that it may well be a point that is examined much more closely when the matter is raised in the other place.
Kate Hoey
I, too, wish to congratulate my hon. Friend the Member for Hayes and Harlington (John McDonnell) on the way in which he spoke, because this issue too often becomes one of exaggeration, where inaccurate things are said on both sides. He gave a very reasoned outline of why this coalition Government are rather silly in proposing this measure at this time and in this way. I, too, have been in this place a long time and I have seen legislation go through as a knee-jerk response to something that has happened. Very often people later regret very much that such legislation went through.
It is quite wrong that something that has been introduced so recently, and where a substantial number of people in a consultation—90% of them—were opposed to it, is being put through in this way. As everyone else has said, this is, in reality, a Second Reading debate. No scrutiny will be provided in the House of Commons on the detail, so all these questions are being raised by different people about different aspects of it and we will not get a full answer. We are abrogating our duty and our responsibilities as Members of Parliament if we allow this measure to go through and hope that it will be dealt with in the other place. I am disappointed that Labour’s Front-Bench team is not taking a more robust view on this measure. There is always a danger for politicians in that regard, because they may worry about what the headline will say, but sometimes the headline is totally inaccurate and sometimes it has been devised because of the inaccuracies, the half-truths and the mistruths that have been put around over a period of time. Even at this stage, I hope that the Labour Front-Bench team will consider amendment (a) seriously.
I believe that the retrospective nature of the measure is quite wrong. I also believe that there is squatting and squatting. The public see the difference in the kind of squatting that we have all condemned, whereby people take over someone’s house because they are away on holiday. However, there is already a law to prevent that from happening and those Members of Parliament who say that that has not been observed in their area should talk to the police because it means that the police are not enforcing the law.
The kind of squatting that I support is the kind that the right hon. Member for Bermondsey and Old Southwark (Simon Hughes) mentioned, when large blocks of flats and houses that have deliberately been emptied early by a local authority or a private developer sit empty for months or years waiting either for some work to be done or to be knocked down. I see absolutely no reason why people who have come to London as the capital city of their country to try to get work and to live but who have nowhere to live and no chance of getting a local authority flat or of affording a private sector property should not live in those empty properties. Most of those squatters would be perfectly willing to sign something saying that they will move out as soon as work is to start. Instead, we see such places being left empty for years.
I am very sad indeed that we are seeing this knee-jerk response and that the Government are trying to introduce this measure so quickly. They will live to regret it and I hope that even tonight, at this late stage, Members who have come along thinking that there was no debate to be had and that this was a matter of, “Let’s just get this through”, will think very carefully and will at the very least support the amendment of my hon. Friend the Member for Hayes and Harlington.
Mr David Nuttall (Bury North) (Con)
I rise to support new clause 26 and I start by paying tribute to my hon. Friends the Members for Hove (Mike Weatherley) and for Finchley and Golders Green (Mike Freer) who, along with myself, have moved this matter up the agenda. I am grateful that the Minister has listened and that we now have some clarification over this area of law.
I have practised as a solicitor and I can tell the House that, regardless of the 1977 Act, this area of law is completely unclear. It is unclear to the police, to lawyers and to home owners and it certainly is not working. Millions of home owners will be grateful that the new clause is, I hope, going to reach the statute book. There could be nothing worse for someone returning from a holiday than to find that their home has been occupied by squatters. Insult is then added to injury if they are told by their lawyer that they need to embark on a long and complicated civil law procedure, and a costly procedure at that.
I note the point that has been made by Opposition Members about there being doubt about the exact numbers of properties that are occupied by squatters, but the fact remains that if a home owner returns to their property to find it occupied by squatters, it is 100% occupied by squatters and the overall statistics are, frankly, irrelevant.
Let me make one further point about the amendment on which I understand we are to divide. It provides that an offence would not be committed
“where the building has been empty for six months or more”.
One point that has already been touched on is of real concern to many people. When a family member dies and leaves a property empty the personal representatives might have to wait many months—often longer than six months—before they can obtain a grant of letters of administration. There are many instances of properties being occupied by squatters in that time and, for that reason if no other, I hope that the House will reject the amendment. The new clause is a great step forward. It is often said that an Englishman’s home is his castle and I hope that this will help to reinforce that.
Caroline Lucas
I share the concerns that have been expressed by many Opposition Members about the Government’s proposals further to criminalise squatting. I want to highlight just a few of them. My first concern is the justification for the proposals. Squatting can have devastating impacts, and I want proper redress and protection for anyone who returns from a two-week holiday to find their house squatted, or for someone trying to sell their house who leaves it empty only to find squatters have moved in. But the law already stands to protect people in those instances. The major problem in dealing with cases of squatting is not the law itself but the enforcement of the law, including the time it can take for the courts to issue an interim protection order, for example.
In theory, there is no reason why such an order cannot be issued far more swiftly. In practice, I accept that things can take far too long, often compounded by what appears to be a lack of understanding of the law by many police, who are the first port of call for home owners. That is unacceptable and it needs to be addressed, but those delays in implementing the law often result in cases being highlighted in the media, wrongly creating the impression that home owners are not protected in any way from squatting.
The law clearly states when a criminal act has taken place. For example, section 7 of the Criminal Law Act 1977 makes it clear that squatters asked to leave by home occupiers are committing a criminal offence if they fail to do so.
Mike Weatherley
The hon. Lady is under a misapprehension. The person who comes back from holiday and finds their home squatted has no legal redress other than to ask the squatters to leave. The squatters are already in that property; they should not be there while the owners are on holiday.
Caroline Lucas
The legal redress is to ask them to leave. If the squatters refuse to leave, they are committing a criminal offence. That is the point.
In September 160 housing lawyers wrote an open letter accusing Ministers and politicians of distorting public debate by making inaccurate statements about the law on squatting. I claim that that is exactly what is going on in the House tonight.
Even the Metropolitan police and the Association of Chief Police Officers believe that the current squatting law is sufficient and that a new one would be a waste of police resources that could impact negatively on community relations. We need to see instead efforts increased to enforce the current law properly and swiftly, including better training for police officers.
As many Opposition Members have said, many homeless people are pushed into squatting and do not do so out of choice. The appalling and often dangerous conditions in many squats are hardly attractive. Research by Crisis shows that 40% of single homeless people escape the horrors of rough sleeping by squatting, mostly in disused properties. These are the people who are most likely to be affected by the proposed new law, and who will be unnecessarily criminalised.
Often homeless people will suffer from multiple diagnoses, with a combination of mental ill health, substance abuse and other problems. The challenge is to ensure that practical measures are put in place so that people with the most complex multiple needs can be supported more effectively and squatting avoided in the first place.
Joan Ruddock
(Lewisham and Deptford): In my surgeries now for the first time I am seeing people who are not in the categories that the hon. Lady has just described. I am seeing people in work who are losing their accommodation; they cannot keep going in the private sector on the wages that they earn. Those people are becoming homeless without any access to other provision, and some of them will turn to squatting, and I can well understand why.
Caroline Lucas
That is exactly the point I was about to come on to. In my surgeries in Brighton, Pavilion we are seeing levels of homelessness rising. People are coming to me in exactly the situation that the right hon. Lady describes. According to figures from the Department of Work and Pensions, 840 people in Brighton and Hove risk losing their homes as a result of the proposed changes to the shared accommodation rate of housing benefit, making this area of Brighton one of the worst affected in the whole country. So Government efforts must focus much more on tackling the root cause of the problem, not on penalising vulnerable homeless people, including those living in buildings that have been empty for long periods and are not about to be brought back into use.
Part of the solution is investment in affordable housing and so, too, are measures to bring empty properties back into use as soon as possible. Brighton and Hove city council was named 2011 practitioner of the year by the Empty Homes Network for bringing 154 properties back into use over the past 12 months alone. The council’s amazing success is down to the hard work it has put into identifying empty private properties and its commitment to working with the owners of those properties where possible.
Insufficient work is still being done about empty properties nationally. The Under-Secretary of State for Communities and Local Government, the hon. Member for Hazel Grove (Andrew Stunell), admitted in response to my oral question that only 46 empty home management orders had been issued in the full five years since they were brought in. That and other steps to tackle the lack of affordable housing in my constituency and elsewhere must be given far more priority than playing political football with the roofs over people’s heads.
As many other Members have pointed out, the way the proposal has been brought to the House is completely unacceptable. To say that it was rushed is no exaggeration. This is not proper scrutiny; laws made in this way can only end in problems. The Government’s consultation on squatting closed only three weeks ago and I am sure I am not the only person who suspects that the 2,217 responses have not yet been fully analysed, especially as I understand that more than 96% of them expressed real concern about the impact of criminalising squatting. What is more, the option we are asked to consider today was not even included in the consultation.
In conclusion, there is no denying that some high-profile cases raise serious concerns about the need to enforce better existing laws on squatting, but criminalising vulnerable homeless people is inhumane, undemocratic and, crucially, unnecessary.
Mr Speaker
Order. Before I call the next speaker, I point out that I think the House would expect the Minister to have five minutes to respond to the debate.
Mr David Ward (Bradford East) (LD)
Thank you, Mr Speaker, for the four minutes.
A lot has been said. We have heard about parallel universes; indeed, we come here from different parts of the nation to offer different views. We have heard that the Englishman’s home is his castle. It is awful for people when their home is broken into; it feels desecrated and dirty. Where have the intruders been and what have they been up to? It is an awful feeling and we understand it, but when I heard some of the comments from Government Members I thought about my perspective—my universe.
When we talk about squatters, people think in terms of their own home, but that is a far cry from my experience of squatters. I am talking about people in places where there is no electricity, gas or water. There is no toilet and in some cases there is not even a roof. The properties are cold, damp, dark and very dangerous, with rats, stench and disease. They are also very violent places.
What about the squatters? We are not talking about hippy communes, with bean bags, beer and loud music, or about scroungers who ought to pull their socks up and get a job or go back home. We are talking about people without friends or families, and possibly without futures. In my experience, no one squats if an alternative is available.
That may not be the experience of other people, but it is mine. Debate on the provisions on legal aid and social welfare was shamefully evaded last night, but so many people in squats have suffered as a result of the failure of our system. In many cases, the state has put them into that position, whether the health service or the council; 78% of squatters have been turned away by their local authority. The failure may relate to employment support, or people may have just been downright unlucky.
Where on earth is the value in adding a criminal record to the problems those people face? The proposals are irresponsible. They are costly. At a time when we are being asked to do so many things that are unpleasant and unpopular, but possibly necessary for the deficit reduction plan, these proposals would simply add to the costs that we will all have to face, if not in our communities then in Armley prison. It does not make sense. The proposals do not add up.
The two universes could be brought together through amendment (a), which is a compromise that would improve the enforcement of existing legislation, with the back-up of the six-months provision. I shall support it.
Mr Blunt
It is pleasure to follow the hon. Member for Bradford East (Mr Ward), with the undoubted candour that he brought to his remarks. However, I profoundly disagree with him. It is a basic premise that if one takes someone else’s home, one has stolen from them one of the most important things for any of us. I am afraid we are going to part company on that principle, and as he will have heard in my opening remarks, the issue of homelessness has to be addressed in that strategy.
I thank the official Opposition for their support, presented with his usual enthusiasm by the hon. Member for Hammersmith (Mr Slaughter). There was a moment when the charming side of the hon. Gentleman almost escaped—his rather touching revelation about his aptitude for politics when assessed by an external examiner at A-level. For that at least, I am grateful. However, to challenge us about talking business out, when he made a three-hour speech on the first group in Committee, would have come better from someone else.
The hon. Gentleman made an accusation that there was no clarity. There is absolute clarity in what we are doing. To try and escape into the issue of when a bothy is not a bothy, which will not be entirely clear to hikers, was the refuge of the desperate. When people are hiking they are clear where bothies are, and if they are not, they should not be undertaking the hike.
The hon. Gentleman asked about the benefits of the measure and the impact assessment. The impact assessment is clear. It has to identify benefits and potential risks. The benefits section of the impact assessment makes it clear that there could be significant benefits for residential property owners in the form of reduced legal costs in particular. Perhaps that puts into context the lobby by the legal profession. The impact assessment also suggests that if the offence acts as a deterrent, the instances of squatting may decrease.
I am grateful to my hon. Friend the Member for Hove (Mike Weatherley) for his excellent speech and the impressive campaign that he has waged on the issue. He made the point that we owe a duty to the homeless, a view shared by all on the Government Benches. His pertinent challenge to find any case where squatters have improved a property by virtue of their occupation was extremely telling.
In my opening remarks I tried to answer the terms of the amendment tabled by the hon. Member for Hayes and Harlington (John McDonnell), who asked us not to legislate on the basis of anecdote or prejudice. I say to him and to the hon. Member for Vauxhall (Kate Hoey) that the issue is hardly a surprise. It has been around for a very long time. The Prime Minister announced the consultation back in June. We have consulted for 12 weeks, and what we have tabled is a limited proposal. Those on the Opposition Front Bench feel able to support it because it is limited to residential properties.
As I said, we will keep the other areas under review, particularly commercial property. We recognise that that will be more controversial. That is why the proposals are limited to subjects on which we believe there is widespread agreement. In the words of the hon. Member for Hammersmith, those on the Front Bench support criminalisation as it represents arrogant behaviour on the part of squatters, who think they can just take someone else’s property.
The hon. Member for Hayes and Harlington said that only seven victims of squatting responded to the consultation, but a number of local authorities responded and a number of law firms responded on behalf of several of their clients who had been victims of squatting. My hon. Friend the Member for Bury North (Mr Nuttall) made the same point and I am delighted to find myself in absolute agreement with him. Four landlords associations representing a very large membership responded to the consultation and they all shared a desire to strengthen the law.
My hon. Friend the Member for Finchley and Golders Green (Mike Freer) made a powerful case. He made the basic point that what we are addressing here is something that is fundamentally wrong. It is wrong to steal someone else’s home and that is what the new clause will address—
Business without Debate
(12 years, 6 months ago)
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Sittings of the House
(12 years, 6 months ago)
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Mr Speaker
Order. Before I call the hon. Member for Bristol East (Kerry McCarthy), I appeal to Members leaving the Chamber to do so quickly and quietly, affording the same courtesy to her that they would wish to be extended to them in similar circumstances.
World Vegan Day
(12 years, 6 months ago)
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Kerry McCarthy (Bristol East) (Lab)
I start by expressing my sympathy for the Minister tonight. It can never be much fun doing the late night Adjournment debate, and I am fairly sure that this is not an issue dear to his heart.
This is the first time that world vegan day has been marked in Parliament. The chefs have also done a sterling job, with vegan dishes in the main restaurants on the parliamentary estate every day this week. Earlier today, the Vegan Society event was swamped by MPs and staff lured there by the promise of free vegan cupcakes. The cakes came courtesy of the award-winning Ms Cupcake, who has just won contracts to supply her cakes to the Olympics and Paralympics, not because her cakes are vegan but because they are delicious.
As a vegan of nearly 20 years’ standing, I am very fortunate to represent a seat in Bristol, because it not only plays host to the largest vegan fayre in Europe each year but has some great restaurants and shops catering for vegans, such as Cafe Kino, Cafe Maitreya, Wild Oats, Better Foods and the Sweetmart. I am pleased to be joined tonight by my vegan comrades, my hon. Friends the Members for Derby North (Chris Williamson) and for Kilmarnock and Loudoun (Cathy Jamieson). We are apparently the largest vegan caucus in the world.
In response to a survey by the Department for Environment, Food and Rural Affairs in 2007 on public behaviour and attitudes towards the environment, about 2% of respondents said that they were vegan. The number of converts is growing. The former fast-food lover Bill Clinton has adopted a vegan diet for health reasons, saying that previously he had been playing Russian roulette with his health, and last week both Ozzy Osbourne—the man who used to bite the heads off bats—and Russell Brand announced that they had decided to become vegan after watching the film “Forks Over Knives”. Other celebrity vegans include Joaquin Phoenix, Alicia Silverstone, Ellen DeGeneres, Carl Lewis, Woody Harrelson, Bryan Adams, Chrissie Hynde, Alanis Morissette, Benjamin Zephaniah and even Mike Tyson—so when people say to me, “You don’t look like a vegan”, I am not quite sure what they mean.
A vegan diet means not eating meat, fish, dairy, eggs or products derived from them. Ethical vegans also avoid wearing leather, wool and silk, and buying or using products that are tested on animals or contain animal products. I think that it is a personal choice how far people want to take it, and some vegans are much stricter than others, which is fine.
Among the many prejudices against vegans is the belief that they are always preaching to others and trying to convert them. I do not think that is true; we are incredibly tolerant. We are always polite when others ask, “Don’t you ever get tempted by a bacon sandwich?”—as the Whip did to me only a moment ago—and we always pretend that we have never heard anyone tell the “Spock from Star Trek vegan/Vulcan” joke before, even though we hear it practically every day. In fact, most vegans I know are rather coy about explaining why they are vegan, mostly because the question tends to be asked when we are sitting a dinner table full of meat eaters, and it seems rather impolite to answer. However, seeing as we are not at a dinner party now, here is the ethical case, the health case and the environmental case for being vegan.
If people are vegetarians for ethical reasons—because they believe that killing and eating animals is wrong—they really ought to be vegan, too. The average human eats more than 11,000 animals in his or her lifetime, but millions of calves and chicks are also killed every year as “waste products” of milk and egg production. I confess that, for me, it took a long time for the penny to drop that cows are not constant milk-producing machines. Just like every other animal, including human females, cows produce milk only to nurse their young. The dairy industry means artificially forcing loads more milk out of cows—10 to 20 times more than they need to feed their calves, with their huge udders causing painful mastitis and lameness—and taking their calves away early, or, in the case of male dairy calves, which are useless to the dairy industry, either shooting them at birth or exporting them live to the rest of the EU for the veal trade. The average lifespan of a dairy cow is six years, compared with a natural lifespan of 20 to 25 years. Some 100,000 male calves a year are deemed a surplus by-product on Britain’s dairy farms because they cannot give birth or produce milk. An undercover investigation by the Bristol-based vegetarian campaign Viva! showed a calf taken from its mother and shot in the head at Halewood Gate dairy farm near Bristol, which supplies milk for Cadbury—something that was reported in The Sun of all places.
Hens are forced to lay 20 times as many eggs as is natural for them. Male chicks are useless to the egg industry. Millions of day-old chicks are killed, with many thrown alive into mincers—known as “homogenisers”. This also happens in free-range and organic systems, despite their claims to be cruelty-free. I have previously raised with the Minister my concern that, having made progress in areas such as banning battery cages, this country is now moving to embrace industrial-scale intensive farming, with the Nocton dairy mega-farm, housing thousands of cows in something that resembles a multi-storey car park, and the huge pig farm planned in Foston, Derbyshire, with more than 20,000 pigs and piglets. I know the Minister’s views on that well, so I will touch on it only in passing.
Chris Williamson (Derby North) (Lab)
Does my hon. Friend agree that the case for eating less meat or becoming vegan is reinforced by the fact that major companies are buying up vast tracts of land in developing nations to grow grain for animals, displacing subsistence farmers from their land? When 2 billion people on this planet are going hungry every night, would it not be better to use the food that we produce more efficiently by feeding it directly to human beings, rather than to animals, which is an inefficient way of using land?
Kerry McCarthy
I agree entirely with my hon. Friend, and I will come to the environmental and food security case for being vegan in a moment.
Simon Hart (Carmarthen West and South Pembrokeshire) (Con)
Can the hon. Lady point to any peer-reviewed science to support her allegation about the UK livestock industry, rather than giving us the mantra of the animal rights or vegan movement? If she can do that, her argument might carry a bit more weight.
Kerry McCarthy
I am about to cite some scientific research on the health case, and I also have some very authoritative sources for the environmental case. The ethical case is about people’s personal opinions on whether it is ethical to treat animals in such a way or to eat them. It is not science-led; it is led by people’s morals.
Simon Hart
So is the hon. Lady saying that the assertions she has made about agricultural practices are a personal opinion, as opposed to there being any evidence to support them?
Kerry McCarthy
I am not quite sure which practices the hon. Gentleman is referring to. If he is talking about the average lifespan of a dairy cow, that is something that I have researched and it is in the public domain. I know that DEFRA is looking to get the average lifespan of a dairy cow up to eight years, but six years was the average cited in the research that I looked at, while the figure for cows suffering from mastitis is 33%. I could go on—although I do not have the footnotes before me—but it is all in the public domain and well researched.
It can be quite difficult to nail down the facts and figures on the health benefits of a vegan diet, particularly when organisations such as meat marketing boards and milk marketing boards spend millions on counter-promotions. As I have mentioned, the recently released film “Forks Over Knives” puts the case that switching to a wholefoods-based vegan diet can prevent and even reverse serious illnesses. The film gives an overview of the 20-year China-Cornell-Oxford project, which found that a number of diseases, including coronary disease, diabetes and cancer, can be linked to the western diet of processed and animal-based foods. It is certainly true that the traditionally very low rates of breast cancer among Japanese women are increasing as they adopt western diets with a higher consumption of animal fats. In Japan, affluent women who eat meat daily have an 8.5 times higher risk of breast cancer than poorer women who rarely or never eat meat.
Jim Shannon (Strangford) (DUP)
How would the hon. Lady respond to the statement by my GP and many others that we need a balanced diet, and that a balanced diet should include meat?
Kerry McCarthy
I will come to that in a moment. The World Cancer Research Fund carried out an authoritative study which found that people should avoid processed meat altogether, and eat red meat in moderate amounts only. That is the most authoritative study that I have come across. Cancer Research UK is co-funding a massive study called EPIC—the European Prospective Investigation into Cancer and Nutrition—which has found that people who ate two daily 80-gram portions of red or processed meat increased their risk of developing bowel cancer by a third, compared with those who ate just 20 grams a day. The same study found that people eating more than 100 grams of meat a day had over three times the risk of getting stomach cancer.
As I mentioned, the World Cancer Research Fund reviewed 263 research papers and concluded in May this year that there was convincing evidence that red and processed meat increased the risk of bowel cancer. When those findings emerged, the National Beef Association and the National Sheep Association, in conjunction with the National Farmers Union, issued statements accusing the fund of misleading the public. The fund retaliated by accusing the British meat industry of potentially defamatory and deliberately misleading statements, and repeated its message that it was best to avoid processed meat and to eat red meat only in moderation. It stated:
“The fact is that our report is the most comprehensive and authoritative review of the evidence that has ever been published and it found convincing evidence that red and processed meat both increase the risk of bowel cancer”.
As I have mentioned, there has been a significant rise in the number of people who are becoming vegan—[Interruption.]
Cathy Jamieson (Kilmarnock and Loudoun) (Lab/Co-op)
Just before my hon. Friend moves off her point about balanced diets, will she tell us—perhaps for the benefit of those on the Conservative Benches who seem to be heckling about what is or is not a case for veganism—whether she agrees that it is entirely possible to have a healthy, balanced diet without eating any animal products whatever?
Kerry McCarthy
That is true. As I said, I have been a vegan for nearly 20 years. My hon. Friend the Member for Kilmarnock and Loudoun has been one for 15 years, and my hon. Friend the Member for Derby North has been one since time immemorial—well, since the 1970s, anyway. I think that we are all testament to the fact that people can survive perfectly well on a vegan diet—[Interruption.] My hon. Friend the Member for Kilmarnock and Loudoun referred to the heckling. It is strange to have heckling in an Adjournment debate, and I think it is perhaps testament to the strength of our argument that people feel they have to mock what we are saying rather than joining in the debate.
I deal now with the environmental case for switching to a vegan diet. The 2006 report by the UN Food and Agriculture Organisation, “Livestock’s Long Shadow”, stated that the livestock industry was responsible for 18% of global greenhouse gas emissions. That is more than the transport sector, including aviation, which produces 13.5%, yet there is a huge public debate about aviation and virtually no debate about livestock. I secured a debate on this issue in Westminster Hall in 2009, and my hon. Friend the Member for Stoke-on-Trent South (Robert Flello) subsequently made a valiant attempt to put the Sustainable Livestock Bill through the House, only for it to be blocked by the Government. I hope that the Minister will have time tonight to update the House on the progress of some of the promises that he made when he responded to a speech by my hon. Friend almost a year ago today.
Meat consumption is an incredibly inefficient way to feed the planet. It takes 8 kg of grain to produce 1 kg of beef. It takes 100 times as much water to produce 1 kg of beef as it does to grow 1 kg of vegetables. It takes almost 120 calories of fossil fuel energy to produce 1 calorie of beef, compared with 2.2 calories to produce a single calorie of plant protein. It takes almost 21 square metres of land to produce 1 kg of beef, compared with 0.3 square metres to produce 1 kg of vegetables.
We hear a lot about biofuels and deforestation, but whereas in 2009 about 100 million tonnes of crops were being diverted to create biofuels, around 760 million tonnes were being used to feed animals. As Raj Patel wrote in his excellent book “Stuffed and Starved”:
“The amount of grains fed to US livestock would be enough to feed 840 million people on a plant-based diet. The number of food-insecure people in the world in 2006 was, incidentally, 854 million”.
I am conscious that I have not mentioned fish at all during this debate. I would refer the House to the extremely powerful documentary “The End of the Line”, and also to the series “Fish Fight” by Hugh Fearnley-Whittingstall, which highlights some of the issues to do with the sustainability of our fish stocks and the impact of over-fishing on our marine environment.
I conclude with some questions for the Minister. It was disappointing that at the climate change talks in Copenhagen, the environmental impact of the livestock sector was given little prominence. What steps are the Government taking to ensure that this issue has a higher priority on the agenda at Rio next year? Will it also be on the agenda at the climate change talks in Durban next month?
What discussions has the Minister had, or will he commit to having, on these issues with our EU counterparts, particularly in the context of reform of the common agricultural policy? According to Compassion in World Farming, at least 80% of the EU’s animals are factory farmed. What vision does the Minister have for the future of farming across the EU in terms of animal welfare standards, environmental impact and sustainability?
In respect of development policy and global food security, what consideration has been given to the health and environmental factors I have mentioned in terms of feeding the world’s growing population? Is this something that is ever discussed between DEFRA and the Department for International Development? What assessment have the Government made of the health benefits of a diet low in meat and dairy consumption? What guidance is given in the public sector—in schools, hospitals and prisons, for example—on the availability of vegan food with a view to meeting the needs of those who have chosen a vegan diet, and with a view to the health benefits?
What further progress can be made on food labelling so that vegans know whether the products they purchase are ethical or not? Can the Minister also confirm that when the EU directive on animal experimentation is transposed into UK law, it will not mean a lowering of standards? And finally, there is concern that the proposed network of marine protected areas to be established under the Marine and Coastal Access Act 2009 next year will not adequately protect wildlife and that some of our most important marine wildlife sites could even be missed off altogether. Can the Minister provide reassurance on this point and perhaps tell us more about what he or his Department is doing to tackle over-fishing?
I appreciate that I have at times strayed somewhat outside the Minister’s brief, but I hope he can give clarity on at least some of the issues I have raised. I thank him for his patience in listening to me.
The Minister of State, Department for Environment, Food and Rural Affairs (Mr James Paice)
May I genuinely congratulate the hon. Member for Bristol East (Kerry McCarthy) on taking the opportunity to raise the issue of vegans on world vegan day and to elaborate on her thoughts and the views that she and her colleagues hold? She rightly identified at the outset that she and I will not agree on some of these issues, but I respect the intensity of her views, which she and I have exchanged several times over the Dispatch Box.
May I say, however, that I do not think hon. Lady helps her cause by some of the quite wide exaggerations she made in her speech? To talk about an intensive dairy farmer as being akin to a multi-storey car park is, frankly, ludicrous. There is no suggestion—
Mr Paice
The hon. Lady is saying something from a sedentary position—I will need to get this on the record, Mr Speaker—about cows on top of each other. There is no such question. The proposal at Nocton, which is now dead as a proposal anyway, did not involve a multi-storey facility. It does not do the cause any good to exaggerate like that.
I hope I can answer some of her questions. As she said, some of them have strayed a little from my brief. I think many of the answers are in the Foresight report, which was the Government’s chief scientific adviser published in January this year. That is all about the future of food and farming. It looks not just at the UK, but at the global demand and supply for food over the next 30 or 40 years up to 2050. We are having this debate on the day after the 7 billionth person was born on this planet; it is quite right to think about the security of our food supply across the globe.
There is no doubt that, as the Foresight report made clear, the current food system is consuming the world’s natural resources at an unsustainable rate. I agree with the hon. Lady about that. At this rate we will continue to degrade our environment, compromise the world’s capacity to produce food in the future, and contribute to climate change and further destruction of our biodiversity.
The status quo is not an option, which is why we in DEFRA have put the importance of sustainable food and farming at the forefront of what we are doing. It is the first priority of our business plan. It underpins everything. We are looking at the food chain in its entirety, with the aim of helping to secure an environmentally sustainable and healthy supply of food and creating the conditions for the agri-food sector to succeed. The Foresight report—this is relevant to one of the hon. Lady’s questions—highlighted the significance of dietary changes to the sustainability of our food supply, given that, as the hon. Lady rightly said, some foods require more resources for their production than others. We all need to play our part.
The most important people in all this are consumers. As the hon. Lady suggested, they can best be helped to make the choices that they want to make when they are receiving consistent messages about what constitutes a sustainable balanced diet, and, indeed, what the products that they are purchasing contain. By providing a robust evidence base, we can work closely with a wide range of partners to try to ensure that they are given that information.
The issue of diet is complex. Across the world, cultural, social and religious factors influence the make-up of what we eat. The Government do not believe that we should undermine those influences. We see value in encouraging people to think carefully about the environmental impact of the food they eat. Groups such as the Vegan Society provide information for consumers and help to increase their knowledge. However, we also need to recognise that a vegan diet is not for everyone.
I must tell the hon. Lady that I was a bit confused about whether she was advocating veganism, was concerned about animal welfare, or was simply recommending a balanced diet involving a lower proportion of processed meat—with which recommendation, incidentally, I would entirely agree. We know that there are recommendations suggesting that people should not eat too much processed meat. However, that is a long stretch from the more extreme position of a vegan, which, as the hon. Lady said, means eating absolutely no products of animal origin. There is a great difference between the two positions. The Government recommend a balanced diet. We are not going to tell people what or what not to eat; we want people to be given information that will enable them to make informed choices.
The hon. Lady raised the issue of food labelling. As she knows, we are committed to improving it: that has been one of our prominent policies both in opposition and in government. As she also knows, there is currently no definition in law of the term “vegan”, and labelling products as vegan is entirely voluntary. However, if such labelling is used, consumers are protected by the law, because it is illegal to mislead them through false or misleading labelling. A new European Union regulation on the provision of food information to consumers will be published in the next few months, and will then enter into force in all member states. It covers the rules for general food and nutrition labelling, and requires the European Commission to draft a set of measures governing use of the terms “vegetarian” and “vegan”. I hope that that reassures that the hon. Lady that the issue is being, and will continue to be, addressed.
The Government’s promotion of advice on a balanced diet applies to vegetarians and vegans as well as to those who eat much more livestock products. A well-planned diet based on anything can be healthy as long as it contains the right balance of foods. The main issue that we face is, of course, obesity, which is a leading cause of serious diseases such as type 2 diabetes, heart disease and cancer. It also costs the national health service £5 billion a year. The Government’s recently published document “Healthy lives, healthy people: a call to action on obesity in England” sets out how obesity will be tackled in the new public health and NHS systems, and the role that partners can play. Obesity is a serious problem, and it is the responsibility of individuals to change their behaviour to benefit their health. Most of us are eating or drinking more than we need to, and we are not active enough. Being overweight or obese is a consequence of eating more calories than we need.
Chris Williamson
The Minister says that diet and avoiding obesity are the responsibility of individuals. Does he not accept that companies such as McDonald’s ruthlessly and specifically target young children in order to force on them a diet that is wholly unhealthy and contributes considerably to the obesity crisis that the nation is currently experiencing?
Mr Paice
No, I do not accept that. The hon. Member for Bristol East reeled off a list of vegan organisations, businesses and retailers in Bristol. They all have a right to advertise their wares as long as they are selling something that is lawful. I do not believe that it is for Government to tell them they should not do so.
What matters is that we encourage people to reduce the amount of calories they consume, in whatever form. As part of the Government’s ongoing Change4Life campaign, we are encouraging people to make the key simple changes: eat more fruit and vegetables; cut down on fatty foods, particularly unsaturated fats; reduce calorie consumption; and, of course, be more active.
Kerry McCarthy
This section of the Minister’s speech sounds like filler to avoid talking about the issues I have raised. He said that it is important that people get the right balance in their diet. What do the Government regard as the right balance for eating red meat and processed meats in a diet?
Mr Paice
I cannot tell the hon. Lady that precisely. Such matters are the responsibilities of the Health Education Authority and the Department of Health. As she rightly said in her earlier comments, they are not part of my remit. There is a wealth of information, however, about balanced diets and recommended proportions and amounts, and 70 grams a day of meat is established as being a good figure.
The hon. Lady does me a disservice by suggesting I was not going to answer her questions, as I will do so. However, the points I am making now are important, and they are relevant to the question of balanced diets.
Returning to the Foresight report, which I mentioned earlier, it is clear that we need to achieve a sustainable food supply and to use the whole range of measures available to us. The hon. Lady made a point about the consumption of grain to produce meat. I have to say to her that two thirds of the world’s farming area is grass, and the only way to turn grass into food is to feed it through livestock. If we were to remove all that livestock from the system, the world would be a lot shorter of food. That is a simple fact, so what else is the hon. Lady going to do? She looks askance, but she should understand that large parts of the world will not grow grain as the terrain or climate is wrong, or the soil is too thin. Therefore, grass is the only option if that land is to produce food.
The hon. Lady also referred to the figure of 8 kg to produce 1 kg of beef. On the face of it, that is correct, but only if all the cattle are fed is grain. However, as I have just implied, a large proportion of the beef—and the sheepmeat—in this world is produced from grass. Many of the livestock never see a grain of cereal in their diet. That is the reality. Yes, there are beef feedlots in America where the cattle are fed only on grain, and in that context the figures the hon. Lady cites are right. However, to use them as if they apply to the whole industry across the world is entirely misleading. In fact, the bigger consumers of grain are pigs and poultry because they eat nothing else. They can be fed only on grain and soya bean.
On the subject of soya, the hon. Lady talked about the increasing desecration of the rain forest to produce arable crops, but the main such crop is soya bean, which is what most people who do not eat meat eat. How can one have a haggis made of soya? [Interruption.] As my right hon. Friend the Member for Orkney and Shetland (Mr Carmichael) points out, it is possible to find vegetarian haggis. However, the point is that soya is the staple diet of people who do not eat meat.
Mr Paice
No, I am not going to give way, as I do not have much time left.
I go back to my starting point of the Foresight report. The Department for Environment, Food and Rural Affairs has signed up to a five-point action plan to take it forward, and that is very important. I shall now deal with the hon. Lady’s questions, and she will appreciate that I have had them for only a few minutes, although we did speak briefly before the debate. She asked about the climate change talks in Copenhagen and, to the best of my knowledge, the issue she mentioned is not on the agenda at the moment. She asked about our European counterparts and the common agricultural policy, and the answer is that we have not discussed veganism. I am not sure precisely what she wants us to talk to them about, but it is very early days in the reform of the CAP. At the moment, there is no unanimity on the Commission’s proposals for CAP reform.
The hon. Lady alleges that 80% of the European Union’s animals are factory farmed. I suppose that that depends on the definition of “factory farming”, but I find it difficult to believe. I have spoken about development policy and global food security; that is all covered in the Foresight report. She asked about the assessment we have made of the health benefits of a diet low in meat and dairy consumption, and, again, I have addressed the point. It is a matter of balance. It is not a question of doing without those things; it is question of keeping the intake to a sensible level. The figures are available from the various Government bodies. I have addressed the issue of food labelling; it is going to be resolved.
As for the hon. Lady’s question about the EU directive on animal experimentation, I am afraid that I do not know the answer. It is a matter for the Home Office and I cannot answer that. On the establishment of the proposed network of marine protected areas, the Under-Secretary of State for Environment, Food and Rural Affairs, my hon. Friend the Member for Newbury (Richard Benyon), is working very hard on this, along with Natural England. To the best of my knowledge, they will be making sure that wildlife is protected. But that is a long way from the implication that we should not be eating fish, which I thought was her approach.
I hope that I have answered the hon. Lady’s main principles. As I said at the outset, we are not going to agree entirely on this issue, but she has raised it and the House has heard what she has to say.
Question put and agreed to.
Westminster Hall
(12 years, 6 months ago)
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UK Relations: Libya
(12 years, 6 months ago)
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Daniel Kawczynski (Shrewsbury and Atcham) (Con)
Thank you for calling me to speak in the debate, Mr Gray. Some time ago, the late Robin Cook—a man of considerable intellect and experience—spoke about an ethical foreign policy. This new drive, which would shape Britain’s engagement with countries around the world, would be based on our ability to engage in a more ethical way in the modern era, thus protecting our image and branding throughout the international community. Was that a naive objective? As I say, it was formulated and proposed by somebody with considerable experience, and it was certainly a commendable aspiration.
However, following the disastrous engagement in Iraq, and the illegal war that the Labour party pursued there, Mr Blair had a problem with his party and the country. He therefore sought out somebody who would enable him to show the world that although he was making war by force, he could also make peace through international diplomacy. Who better to choose than an isolated figure, ridiculed in the Arab League, with no friends? Mr Blair chose Colonel Gaddafi, who was so bereft of friends that he could be enticed into the little deal—the little charade or rapprochement—that Mr Blair pursued with him.
We were told at the time that as a quid pro quo for this rapprochement, the weapons of mass destruction that Colonel Gaddafi had amassed would be handed over and sent for evaluation and, ultimately, dismantling somewhere in North Carolina in the United States of America. I do not know about you, Mr Gray, but I do not know what those weapons of mass destruction consisted of, how many there were, or what their quality and calibre was. For all I know, Gaddafi may have had just a pea-shooter; his total inability to defend himself in the recent war certainly shows a rather chaotic approach to military strategy.
I did not want rapprochement with Gaddafi, purely because I knew from many friends in Libya, and from having visited the country, of the appalling human rights abuses that this tyrant perpetrated against his people over decades. I hope Members will agree that that does not fit in with the ethical foreign policy espoused with such fanfare by the previous Labour Government.
I have a gripe with not just the Labour Government, but the Scottish National party Government in Scotland. When they were about to release the convicted bomber al-Megrahi, I pleaded with Alex Salmond and the Scottish Justice Secretary not to do so. I also pleaded with the former Labour Prime Minister, the right hon. Member for Kirkcaldy and Cowdenbeath (Mr Brown), on the Floor of the House to intervene with the Scottish Government to prevent the bomber being released. Of course, he told me, “This is nothing to do with us. This is a purely Scottish matter.” Despite the fact that releasing al-Megrahi could have had huge ramifications for the United Kingdom’s foreign policy, the previous Labour Government said, “It’s nothing to do with us.” I am absolutely convinced that our current Prime Minister would not have acted in such a way.
Glyn Davies (Montgomeryshire) (Con)
Does my hon. Friend regret that the Scottish Government have not apologised for what happened, given that although their action was taken on the assumption that the man had less than six months to live, he is, as far as I know, still alive?
Daniel Kawczynski
Yes, I totally concur with my hon. Friend. Indeed, I think that we were told that he had less than three months, not six months, to live, but he is still alive somewhere in Tripoli, two years on.
So passionately did I feel about the release of al-Megrahi that I even travelled to Qatar for an international conference. In front of a totally Arab audience in debates in Doha, I and others won the debate on a motion saying that the house deplored the release of the Lockerbie bomber. A young girl from the United Arab Emirates told me, “On the one hand, you expect us to join you in your war against international terrorism, but on the other hand, you are releasing a convicted bomber who was involved in the worst terrorist atrocity committed on UK soil since the second world war.” That was a very salient, pertinent point, and it certainly stuck in my mind.
Robert Halfon (Harlow) (Con)
I thank my hon. Friend for securing this important debate. Does he agree that the release of al-Megrahi marked the low point in the previous Government’s appeasement of Gaddafi? Does he also agree that they were hiding behind the fig leaf of devolution, given all the revelations that there have been about the surrounding commercial deals between them and Libya at the time?
Daniel Kawczynski
I totally concur with my hon. Friend. The United Kingdom’s reputation was greatly damaged at the time. As I suggested, other Arab League leaders were so contemptuous of this bizarre, tyrannical clown that they told me and others, “If the United Kingdom cannot grapple effectively with Gaddafi, who can they effectively engage with and have a meaningful relationship with?”.
I stopped the previous Labour Foreign Secretary, the right hon. Member for South Shields (David Miliband)—the man who aspired to lead the Labour party—in the Members’ Lobby to ask him about PC Yvonne Fletcher. The Foreign Office had ignored her relatives for years—letter after letter had gone ignored—so to get him finally to meet them, I had to write an open letter on Conservative Home demanding that he did so. Before I did that, however, I stopped him in the Members’ Lobby and asked him to raise these issues and to assist me in fighting for PC Yvonne Fletcher and the victims of the IRA, who had suffered because of Gaddafi’s funding of it. To quote him verbatim, he said, “Don’t rock the boat now, Kawczynski. We’re in very delicate negotiations with Colonel Gaddafi—rapprochement. We don’t want you rocking the boat.” He basically told me to shut up and not to try to stir things up. That is why I believe his judgment was wrong, and why I commend the Labour party on not electing him as leader; I do not think that he is fit to be the leader of the Labour party, given his action then.
I hope that the shadow Minister will agree that this was not Labour’s best moment or its finest hour. How would the Libyan people view us now, if all they had to go on was the incredible rapprochement between Mr Blair and Colonel Gaddafi, and all the pictures of them smiling together in the tent where they met? I contrast that with the superb leadership that our current Prime Minister has shown in helping to secure UN resolution 1973 in order to ensure that NATO’s intervention to protect the citizens of Libya was legal.
I remember going back to my apartment after a late-night vote in February, and watching Colonel Gaddafi on Sky News promising that he would hunt the rebels down city by city, street by street and wardrobe by wardrobe—that was the expression he used. He promised the world that a bloodbath would ensue on the streets of Benghazi and Tobruk if he were given an unfettered opportunity to pursue that. That night I texted the Prime Minister’s Parliamentary Private Secretary three or four times, pleading with him to take the message to the Prime Minister that we must intervene to help those courageous people in Libya, fighting for their freedom against a brutal tyrant. I thank the Prime Minister for taking the decision to support the people, and I rejoice in, and thank God for, the fact that not a single member of British service personnel lost their life. If we contrast that with previous military operations, we see that it is something for which we should all be extremely grateful.
Our interaction with Libya reminds me of something that the Prime Minister said at the Conservative party conference:
“It’s not the size of the dog in the fight—it’s the size of the fight in the dog”.
That encapsulates how, despite the extraordinary problems that this country has—the huge economic deficit that the Labour party so kindly bequeathed us—we can still intervene around the world and help people who are worse off than us, and protect them when they struggle for the freedom that we have enjoyed for such a long time.
Among the things that I have done as a Member of Parliament in the past six years, one of the most pertinent to this debate and the most solemn has been to stand in the British war cemetery in Tripoli. It has beautiful green grass, immaculately cut, and beautiful headstones, immaculately washed. It contrasts with the surrounding district, which is rather shabby and dusty. I stood for hours looking at the headstones of our young service personnel who died so tragically, liberating Tripoli during the second world war. It is deeply striking that so many of them were so young: 22 or 23—some as young as 20. They all died in January 1942 in the liberation of Tripoli, and there is row after row of headstones. I hope that those sacrifices during the second world war, and what we have done, today show the people of Libya that they can trust and depend on us. I pay tribute to a dear friend of mine from my constituency—Mr Ted Sharp, who was a desert rat. I have spent many hours listening to his stories of how there were no food supplies at one stage; some of the desert rats were like skeletons. They went through terrible suffering to free Libya.
The manner in which Colonel Gaddafi died rather shocked me, but I did not shed many tears for his passing. The way in which he was killed shows how despised he was by the Libyan people, but I was disappointed that he was not captured and put on trial. It would have given me great satisfaction to see him atone for the brutality he meted out to his own people for so long.
Robert Halfon
Does my hon. Friend agree that what happened to Gaddafi and the manner of his death make it all the more important that his family be put on trial, both in Libya and the International Court of Justice, to ensure that the rule of law is followed, and that those people atone properly for their crimes?
Bob Stewart (Beckenham) (Con)
At the point of capture, it is difficult to control forces that were not particularly under control in the first place; the testosterone is flowing. People probably just wanted to get rid of Gaddafi there and then. I do not blame those soldiers who killed Gaddafi. Like my hon. Friend, I regret it, but I understand exactly what was going on. They were in the height of battle, their testosterone was flowing, and they just went for it and killed him, because he was the tyrant.
Daniel Kawczynski
I agree. In fact, my understanding is that one of the people involved in his death was from Misrata, and his sister had been raped by Libyan soldiers loyal to Colonel Gaddafi, so I concur with my hon. Friend.
To return to the point made by my hon. Friend the Member for Harlow (Robert Halfon), I have tabled an early-day motion on the issue, calling on the Government of Niger to respect international law and acquiesce in ensuring that the relevant members of the Gaddafi clan—up to 30 loyalists are allegedly in Niger—are extradited to the International Court of Justice at The Hague. My first question to the Minister is this: what discussions is his Department having with the Government of Niger—and with the Governments of Mali and Algeria, where other Gaddafi loyalists are said to be seeking sanctuary? The most important of those loyalists is, of course, Saif al-Islam Gaddafi, who apparently is hovering somewhere around the Libya-Niger border. I hope that that man will not be killed. I would like him to be brought to justice in the Court at The Hague, and would like to hear what the Minister is doing to interact with the Government of Niger, and others, to achieve that.
Bob Stewart
I apologise for making a second intervention, but I have given evidence in five trials at The Hague, and the writ of the International Criminal Court runs only when a national jurisdiction has indicated that it has no intention of trying individuals who have committed war crimes in its territory. I should like the Gaddafi family and their supporters to go back to Libya. There will be a problem, because of the death penalty, but that is what I should like, because it is how the Court should work. A national jurisdiction tries those in question first, and if that does not work, they go to The Hague. I would prefer those people to go back to Tripoli.
Daniel Kawczynski
That is an interesting point, and the Minister will have to deal with the Government’s position on that. Do we want those people sent to The Hague, or should they go to Libya? I defer to the experience of my hon. Friend the Member for Beckenham (Bob Stewart) in those matters.
I am very supportive of the national transitional council, but I am deeply concerned—I feel passionate about it—that there has been no plebiscite. No referendum has been announced on the sort of constitution that the country will have. We have been told that there will be parliamentary elections in eight months’ time, and presidential elections in 18 months. I am extremely concerned that the NTC has already unilaterally decided to state that there will be presidential elections. I think that the last thing the Libyan people want is another Head of State who is a politician. They need to be consulted, so that they can decide what sort of constitution they want. I think that they want a unifying figure: someone who commands respect throughout the country, who is untainted by any previous association with the Gaddafi regime, and who can bring the whole country together in a unifying way. I am not embarrassed to put those issues forward; I do not flinch from doing so. Yes, it is a matter for the Libyan people, but our country has put our service personnel’s lives at risk, and we have a right to advise and caution the NTC in that regard.
Graham Stringer (Blackley and Broughton) (Lab)
I congratulate the hon. Gentleman on securing this important debate. He is making a fairly straightforward case about international justice and constitutional law, which I follow and by and large agree with. Is he concerned, as I am, about the stories coming out regarding atrocities committed by anti-Gaddafi forces?
Daniel Kawczynski
Yes. The hon. Gentleman makes a good point; there are allegations of atrocities on both sides. My hon. Friend the Member for Beckenham talked about testosterone and the desire to take revenge, and we have heard that serious human rights violations and massacres have taken place, such as the shooting of up to 50 Gaddafi loyalists with their hands tied behind their backs in Sirte. The hon. Member for Blackley and Broughton (Graham Stringer) raises an important point, and I would like to hear from the Minister what the Government’s attitude is to ensuring that people are brought to justice.
I believe that the unifying figure who is untainted by Gaddafi and who commands respect in Libya is Crown Prince Mohammed, the heir to the Libyan throne. I have had the great honour and privilege of meeting him; he has lived in London since Gaddafi exiled him and his father from Libya. Gaddafi burned their house down in front of them and then banished them, and they have lived in London ever since. Crown Prince Mohammed’s father subsequently died, but His Royal Highness continues to live in London. Having met him on numerous occasions, I consider him to be, if I may say so, a friend. He is a tremendous counsellor, and I respect him greatly. I have met many leaders around the world in the past six years, but few of them have impressed me as much as Crown Prince Mohammed.
A few weeks ago, I raised directly with the Prime Minister how important it is for him, or at least one of his aides, to meet Crown Prince Mohammed to seek his guidance and views. Foreign Office officials have met Crown Prince Mohammed, but to my knowledge no Foreign Office Minister has yet met him, which I am concerned about. I understand that the Foreign Office does not want to be seen to be manipulating the situation in Tripoli—of course it is for the Libyan people to make decisions—but a member of the el-Senussi family who has extraordinary respect in his own country is living in London; the least the Foreign Office can do is engage with him effectively and properly and find out from him what is happening on the streets of Libya.
The Foreign Office will of course be told a lot by the national transitional council about what the council wants the Foreign Office to know, but I am hearing from Libya—from town councils and the people on the streets of Tobruk, Benghazi and other cities—that many people are holding exhibitions about the history of Libya, which is something that they were deprived of under Gaddafi. Many people are holding exhibitions about the royal family, the late King Idris and Crown Prince Mohammed.
The Foreign Office must be careful. Having spent so much taxpayer money on pursuing the liberation of Libya, we want to ensure that the Libyan people are consulted, and that their will comes through. If they wish to have a constitutional monarchy, as I believe they do, that should be put to them in a referendum, so that they can decide of their own accord, rather than the unelected NTC unilaterally deciding that the Libyan people should have a politician as their Head of State in perpetuity.
Bob Stewart
I, too, have met Crown Prince Mohammed, although he is not as big a friend to me as he is to my hon. Friend. I know that Crown Prince Mohammed has had contact with the Foreign and Commonwealth Office, so it is fully aware of the situation. I subscribe totally to my hon. Friend’s contention that there should be a general election before a presidential one, and I, too, would like someone such as Crown Prince Mohammed to become Libya’s Head of State. However, it cannot be done just like that; the Libyan people have to ask for it. That is fair.
Daniel Kawczynski
I agree with my hon. Friend, but after 42 years of absolute and tyrannical despotism, it is not unreasonable to have a referendum or plebiscite. Let the people decide. Give them the options. We in this country had a ludicrous referendum on changing the voting system, which I was furious about, as chairman of the all-party group for the promotion of first past the post.
Mr James Gray (in the Chair)
Order. The hon. Gentleman is straying off the subject.
Daniel Kawczynski
Sorry, Mr Gray. I had to get that one in; I could not resist. If we can have referendums on trivia such as changing the voting system, the people of Libya should be given the once-in-a-lifetime opportunity to decide what constitution they want. I thank God that we have such a wonderful Head of State as Her Majesty. Some of the most stable countries in the world, such as Denmark, have monarchies. Interestingly, even in the Arab world, people have not rebelled or shown hostility to Governments in countries that have monarchies. I therefore think that monarchy is a stabilising factor.
I would like Niger to hand over Saif al-Islam and others associated with Gaddafi’s regime either to Libya, as my hon. Friend the Member for Beckenham suggested, or the Court in The Hague. I want Saif al-Islam to be captured alive, and I hope that the Government will give me their perspective on that. Do they, too, want him captured alive, so that he can account for some of the crimes committed?
I would like the Government to help the Libyan authorities to find all the money stolen—the billions that have been squirreled away in vaults and bank accounts all over the world, from Liechtenstein to the Cayman Islands. Given the expertise that we have in our country, we should offer the Libyan Government some assistance. London is the financial capital of the world, and we can play a part in helping the Libyan authorities to find all the frozen and other assets that have hitherto not been traced.
One of the most important aspects of the matter is compensation for IRA victims. Colonel Gaddafi provided the IRA with Semtex for many years. I was slightly concerned to read a report in The Sunday Times last week that a private law firm was already asking the NTC to hand over £450 million in compensation. I have two concerns about that. First, that is unduly hasty. Although I am desperate for the families of IRA victims to receive compensation, it might be slightly too hasty to start asking for £450 million in compensation when Libya is practically on its knees, with limited electricity, water and other supplies, even though I would support such a request in the future.
Secondly—I shall emphasise this time and again—I certainly do not want a private law firm to be responsible for bilateral negotiations with the Libyan Government on compensation for IRA victims. It is not for a private law firm to undertake that huge job. I want every single penny piece of that money, when it is handed over, to go to the victims of IRA atrocities. I do not want a private law firm to get £1 million, £2 million, £10 million or £15 million—according to the various reports—of that money. Every single penny piece has to go to the victims. I have raised that point with the Prime Minister in a private meeting, and I expect to hear from the Foreign Office that it will take responsibility for the negotiations to ensure that the private law firm does not make any profit out of the case. We, the state, sacrificed hundreds of millions of pounds and put the lives of our service personnel at risk to liberate Libya, and it is for us to ensure that compensation goes to the victims of IRA atrocities. We do not want some private law firm dishing out the money and making the profits.
Christmas eve will mark the 60th anniversary of the liberation of Libya. I would love to attend the celebrations, but obviously I must be with my family at that time. I am sure that the Libyans would greatly appreciate it if somebody from the Foreign Office went to Tripoli to celebrate their 60th anniversary of freedom.
Will the Minister tell us what will happen about the prosecution of the killer of PC Yvonne Fletcher? Are we happy for this matter to be brought to justice in a Libyan court, or do we want the killer to be extradited to the United Kingdom? In the past, I have said that British justice could not be attained in a Libyan court under Gaddafi’s jurisdiction. During the Gaddafi regime, Scotland Yard had been going back and forth between Tripoli and the UK, and when it was close to getting its man, Gaddafi, in yet another game of cat and mouse, stopped issuing visas. However, things have changed, so I would be interested to hear what our line on that is.
When the new Secretary of State for Defence went to Libya, he said to British companies, “Pack your bags and come here to reconstruct Libya.” I totally agree with him; there are huge opportunities for British firms to help with the reconstruction of Libya. Will the Minister tell us what UK Trade & Investment is doing on that? I had the pleasure of meeting Lord Green, the head of UKTI, in the House of Commons recently, and he told me about some of the changes that he wants to put in place to make his organisation more effective. I would like to know exactly what is happening on the ground.
Many consultants have come to see me and have said, “Look, we have been tasked with finding various companies to do x, y and z in Libya, but we cannot find British companies to do it. The only companies that are prepared to do anything are Danish, Austrian or German, and we are desperate to find a British company to carry out the work.” British companies are hesitant about going to Libya because of security issues and other such matters. I very much regret that. We are the ones who go in and liberate the country, and then everyone else goes in and gets all the business. The British are rather circumspect about such things, but we cannot afford to be. We should not be embarrassed to go out there with our companies for the mutually beneficial reason of reconstructing the country. We must stop this British sentimentality. We must not think, “Oh no, we must not sully our fingers with the business aspects of this.”
The Minister of State, Foreign and Commonwealth Office (Mr Jeremy Browne)
I would not normally interrupt a speech at this point, but I would like to reassure my hon. Friend on this niche specific issue. Lord Green went to Libya in late September, and there have been conferences here on investment opportunities in Libya. The UKTI staff are very much part of our team at the embassy in Tripoli. I hope that efforts are being made—efforts that my hon. Friend the Member for Shrewsbury and Atcham (Daniel Kawczynski) will support—because we are well aware of the opportunities, and wish to seize them in the proper way.
Daniel Kawczynski
I thank the Minister for that. I recently had a meeting with a lieutenant-colonel who had served in Basra. He told me that when he met Mr Blair, he said, “Okay, we brought peace to Basra, so where are all the suits?”. In other words, he wanted to know why Mr Blair had not brought in British companies to reconstruct Basra. Some of the huge problems that we have had in Iraq stem from the fact that we were too slow in bringing in British companies to reconstruct the country. However, we could not have just said, “Look, pack your bags and go to Iraq.” Many companies would have found that difficult, and we are now saying the same of Libya.
Jim Shannon (Strangford) (DUP)
In my constituency, there are a number of companies that are very keen to do business in the region. The trip that the Minister mentioned may have been an opportunity for them to do just that, but the incentive for British business to get involved is not fully pushed by Government. Does the hon. Gentleman feel that the Government should do more to encourage local companies, especially when so many are keen to do business?
Daniel Kawczynski
I agree with the hon. Gentleman. I have had meetings with leading industrialists, and with various Army officers who have served in Iraq and other parts of the world and who have experience of such matters. We have compiled a report, which we will send to the Prime Minister and the Minister, outlining some of the things that the Government have to put in place to ensure that there is confidence, and encouragement for British companies to go out there. The French are brilliant at that; they have a body called COFACE, which I visited in Paris many years ago. It is a nationwide organisation that insures, underpins and takes some of the risk out of French companies going abroad and investing in such projects. The Government should start up a similar insurance fund. We will put in £50 million, the Libyans will put in £50 million, and we will get another few hundred million from wealthy Arab countries. We will then pool the money, and it will act as an insurance policy for British companies that are reconstructing Libya.
I will send the report to the Minister, as well as to the Prime Minister, because we must get a grip on the issue. I could tell the Minister the names of hundreds of companies that I have met in the past six months that would like to work in Libya, but do not know how to go about it. They ask me about guarantees and about what kind of political support is in place.
Yesterday, I met the Labour peer, Baroness Symons, whom I respect greatly. She said that there had been good engagement with Libya previously. I hope that the Minister is aware that the Law Society has been in Libya to help with the rule of law and arbitration. The British Council has operated in Libya, advising on issues to do with women. Welsh universities have signed memorandums of understanding with the Libyan Education Minister to work and interact with Libyan universities. The Westminster Foundation for Democracy has been helping to develop democratic institutions and civil society. Crown Agents were also in the country, working on anti-corruption measures. Those wonderful institutions were already working in Libya under Gaddafi, and I pay tribute to the previous Labour Government for getting them into the country. However, I do not know how successful those institutions were under the brutal Gaddafi regime. Certainly, now that Libya is free, I hope that the Minister will do everything possible to help the Law Society, the British Council, Welsh universities, the Westminster Foundation for Democracy, Crown Agents and others to get to Libya to underpin all that work and to help start reconstructing the country.
The European Union had negotiations with the Gaddafi regime on various trade agreements, and I hope that those are speeded up as well. Apparently, Dominic Asquith has been a representative of Her Majesty’s Government in Libya, and I am keen to know what his views are.
Libya has been a passion for me all my life. When I was growing up in Poland under the communist regime, we had nothing. The regime was brutal and tyrannical, and everything was rationed. My late uncle and his family worked in Libya, and they used to send oranges from Tripoli to Warsaw. Receiving those oranges at kindergarten was like a miraculous experience. Children in Warsaw in 1978 did not know what oranges were; we had never seen these things. We peeled the oranges delicately, we ate them, we made marmalade out of the peel, we drew them and we talked about them. They were incredible to us. Of course, most days now I peel an orange and I do not think about it, but as a child in 1978 I thought, “What sort of paradise must this be for them to have these sorts of things?”. My interest in Libya has stemmed from that early childhood experience.
I love the Libyan people and I love Libya. I am so passionate about the country, and I am so grateful that the brutal tyrant has been deposed. I look forward to the people of the UK having a very strong friendship with the people of Libya for the rest of my lifetime.
Stephen Gilbert (St Austell and Newquay) (LD)
Thank you very much, Mr Gray, for calling me to speak. It is a pleasure to serve under your chairmanship this morning.
I congratulate my hon. Friend the Member for Shrewsbury and Atcham (Daniel Kawczynski) on securing this timely debate. In introducing it, he once again showed his expertise and personal experience, and we are indeed lucky to have him. He set out a compelling account of some of the legacy issues involved in the future of Libya, and he raised other important issues.
As we know, a week ago on 23 October the national transitional council of Libya celebrated the country’s new-found and hard-fought independence. That marked the end of the first chapter in a new story for Libya. Back in March, I welcomed UN Security Council resolutions 1970 and 1973, as well as NATO’s Operation Unified Protector. It was my view then, and it remains my view today, that we could not have stood by and watched the inevitable bloody reprisals of a despotic regime. We were right to take action, and we were right to do so with the clear backing of international law and indeed of neighbouring countries.
Like my hon. Friend, I commend our forces, who stood in harm’s way in the long tradition of our military’s fight against tyranny. However, the success that should be praised above all, as my hon. Friend so eloquently put it, belongs to the Libyan people who rose up, defied a dictator and seized control of their own destiny. They are doubly brave, because they have not only thrown off the shackles of the Gaddafi state but embarked on the long and arduous journey towards a free and democratic society of their own choosing.
As we have seen in other countries during the Arab spring, and indeed as we have seen throughout history, democracy is a long and hard journey, and it is not a quick or close destination. Like the people of every democracy, including the British people, the Libyans have much work to do, and we must help them whenever they ask for it. Securing the future of Libya must now be a priority for Her Majesty’s Government.
Since the end of the conflict, we have seen swift action by the Department for International Development to put in place a programme of humanitarian aid. That work builds on DFID’s success during the conflict in providing much needed aid on the ground in Libya—at the borders and inside the Libyan border—to help those who needed help most. DFID’s work has been seamless with the work of other organisations, such as the World Health Organisation, the International Organisation for Migration and the International Committee of the Red Cross. It is right that DFID continues to play a leading role in the stabilisation and reconstruction efforts in Libya.
As we know, the national transitional council itself has called for a continuing NATO military presence in the region. I, like many others in the House, welcomed the end of NATO military operations in Libya at midnight last night, but we must be prepared to offer assistance if the need for it arises. Consequently, I welcome the recent visit of the Chief of the Defence Staff to the Doha conference on Libya and the support that he offered to the national transitional council, in terms of assistance with specific capability requests for military support as Libya makes its transition to democracy.
With the end of military operations and the return to relative peace and normality, a new and exciting chapter in Libyan history is beginning. It is my view that Britain must build on the work that we have started with the Libyans—for example, we are already providing support for policing. I commend the work of the stabilisation unit to date, and I hope that the Minister will give assurances that it will be properly resourced in the future. We must continue to help to build the institutions of a civil society and to promote the rule of law.
It is vital that the relevant Departments of the UK Government involved in all areas of reconstruction, assistance, enterprise and business work together in a co-ordinated fashion to achieve the optimum results in the shortest possible time. Unco-ordinated efforts run the risk of duplicating work, wasting resources and hampering the emergence of a well-defined, strong and confident Libya.
We should also be working with other countries involved in the reconstruction of Libya, particularly our NATO partners. It would be nonsense if we succeeded in working together to protect the Libyan people in war but were unable to help them coherently in peace.
Bob Stewart
The most important matter that must be addressed by those in authority in Libya is ensuring the security and well-being of the Libyan people. Unless those aims are achieved and unless they remain a constant focus, we run the risk of other, less scrupulous people seizing power in Libya. Also, I totally accept the hon. Gentleman’s point that we could put British military teams into Libya to help to train the Libyan armed forces.
Stephen Gilbert
The hon. Gentleman has made my point far more eloquently than me. He has also pre-empted a point that I will come on to later, which is the deweaponisation of Libya.
Overall, we need to see clear direction on the relative importance of the bilateral support to Libyan efforts. At the moment, DFID is ramping up its efforts in Libya, while the Ministry of Defence is scaling down its efforts. If we are to remain engaged in an integrated way, all Departments need to be at the table, and we need clarity from the Government about our overall objectives. How active will we be, Minister? What is good enough in terms of the peace-building effort? And is our main focus going to be trade, governance, stability or all those issues?
An example of the current confusion is the potential divergence between the DFID-led public safety efforts, which my hon. Friend the Member for Shrewsbury and Atcham has mentioned, and the MOD’s interest in the security architecture. Unless Her Majesty’s Government know what they are trying to achieve collectively in Libya, it will be hard to determine where the various pieces of the jigsaw fit together.
It is important that we are realistic about what the UN and the EU can and cannot do, and what they will and will not do, in Libya. At present, far too many assumptions are being made in Whitehall that the UN will deliver everything that we want it to deliver in the time frames required. It will not do that, particularly within the security sector. Bilateral engagement with Libya by the UK and our NATO allies will be required, but with a view to bringing in the UN, where possible and as soon as possible.
In seeking to aid Libya in its transition, we must also be mindful of how our actions are seen. We should only seek to help Libyan people at their own behest. All our stabilisation efforts must be owned by the local communities. We must never impose, nor appear to be imposing, our systems, beliefs, culture or demands upon the Libyan people. If there is to be a successful transition in Libya to a strong democratic state, it must be a transition that the Libyans themselves have decided upon. Only then will it become entrenched and real.
Of paramount importance in post-war Libya is ensuring that the very weapons used to free the people do not remain in the country long enough to enslave them once again. When a country is awash with small arms, it is at risk of descending into sectarianism, vigilantism and terror. We are already helping the national transitional council in seeking the dangerous weapons that were stockpiled by Gaddafi, and DFID is already helping with demining projects, but we must go further and encourage a much wider demilitarisation of Libya and its people.
Economically, relations between the UK and the new Libya should now move towards development support and enterprise opportunity. In order to prosper fully, Libya will require serious investment and expertise. To that end, I welcome my hon. Friend’s suggestion that there should be an insurance scheme to protect British businesses as they venture into Libya to set up operations.
Daniel Kawczynski
I have visited the beautiful Roman ruins in Libya of Leptis Magna and Sabratha, which are the best Roman ruins to be found anywhere around the Mediterranean. Does my hon. Friend agree that there is also huge potential for British tourism in Libya to see not only those ruins but the beautiful Libyan coastline?
Stephen Gilbert
There are opportunities not only for British business in reconstruction, but for British tourism and for cultural exchanges between our universities and schools. I hope that the relationship between the UK and Libya will flourish on all levels. I am sure that, as we speak, many travel agencies are considering my hon. Friend’s suggestion.
I repeat my call for a co-ordinated UK and European economic response to the Arab spring. Whether in Libya or elsewhere in the region, it is vital that we deliver the benefits of economic pluralism to the people to sit alongside their new and hard-won political pluralism. The Libyan people have thrown off the yoke of repression and conformity, and we must now play our part in lifting them and others out of poverty. We must work to see a strong, confident and open Libya setting its own destiny, offering our help where necessary and when asked, and finally able to deliver security and prosperity to its people.
Robert Halfon (Harlow) (Con)
It is a pleasure to serve under your chairmanship, Mr Gray. I congratulate my hon. Friend the Member for Shrewsbury and Atcham (Daniel Kawczynski) on securing the debate. He displays incredible knowledge of the subject, and his book on Gaddafi is an important read. I thank him for setting up the British Mena—middle east and north Africa—Council for parliamentarians, which gives some balance to the debate. I also congratulate my hon. Friend the Member for St Austell and Newquay (Stephen Gilbert) on his thoughtful remarks.
Daniel Kawczynski
I am sorry to intervene so early in my hon. Friend’s speech, but he has kindly mentioned my book on Colonel Gaddafi, which I gave to the Prime Minister before the last election. Does he know that in the book I thank him for all his work on Anglo-Libyan relations, referring to him as a rising star in the Conservative party who will be in a future Conservative Government?
Robert Halfon
I thank my hon. Friend. Being British, I blush at such compliments. I do not want this to turn into a mutual love-in.
Yesterday marked the end of British military involvement in Libya, seven months after the no-fly zone was authorised, and I would argue that it was one of the most successful NATO operations in history. It proved, all the more importantly after the Iraq conflict, that intervention can work and that Britain can fight for peace and democracy. Although I was disappointed at the manner of Gaddafi’s death because it would have been better for him to be tried in the international courts, I wish that my grandfather, Renato Halfon, was alive now to have seen his demise.
In 1968, after some anti-Jewish pogroms, my grandfather was forced to leave Libya and, as an Italian Jew, he went to Rome. He had planned to return to Tripoli once the pogroms had subsided, but Gaddafi took power in 1969 and all the Jewish businesses and my grandfather’s home were taken. The same thing happened to the Jews and the Italians. Luckily, my grandfather had sent my father to England some years earlier. I love Britain—I was born here and would not live anywhere else—but I feel a deep concoction of Jewish and Italian from Libya, which has been awakened by recent events. I listened with considerable interest to the story that my hon. Friend the Member for Shrewsbury and Atcham told about being in Poland, particularly the part about the oranges, and about what motivated him to fight for freedom in Libya.
It has been good to have conversations with my father and his friends from Libya to try to understand what it was like in those days. My grandfather had a clothing business and sold clothes to the British, and he always said that they were the only people who paid on time. He loved this country more than anything; he thought that the streets were metaphorically paved with gold and that everyone in England was a gentleman. It is worth remembering that King Idris was installed as monarch of Libya in 1951 by the British, in the aftermath of the war, when Libya gained independence from Italy and the old colonial name Tripolitania disappeared.
Although my grandfather and many other people had contempt for Gaddafi, we must acknowledge that in the early days the colonel was not a monster. My father remembers him becoming a rapidly popular figure, who before the coup used to walk down the famous Italian street in Tripoli, Corso Vittorio Emanuele—I think it is now called Jadat Istiklal—shaking hands with passers-by, including my father, wearing a broad serene smile and speaking loudly. He was articulate and nurtured dreams of pan-Arabism, and because of King Idris’s benign weakness, he became known as the liberator. Astonishing as it might seem, he was seen as sympathetic to western interests, and so the Americans, who controlled the large Wheelus air base outside Tripoli, did nothing to stop the coup d’état against the king. No one imagined that Gaddafi would become the monster he did and impose a 42-year totalitarian regime. Now he has gone, everyone is asking, “What next? Will it be a repeat of Iraq in the aftermath of the overthrow of Saddam Hussein?”
It is worth emphasising that a yearning for freedom is deep in every human breast and should be nurtured and supported. The Libyan people deserve freedom just as much as we do in the west. For years, the realist school of foreign policy—I am sure that the Minister is not of that school—has argued that the middle east is not ready for democracy and that democracy cannot be dropped from a B-52 bomber, but actually it can. The NATO planes showed that by providing cover as the rebels advanced on Tripoli, although that is not the only way to do it. We must remember that liberty is a human right for everyone, whatever their background or race. Sometimes it requires military intervention, and sometimes it requires hearts and minds—so-called soft power. Our foreign policy should be directed at supporting groups of resistance to dictators, and at funding radio and TV stations and the internet, in the same way as the CIA did in the cold war to try to combat communism. Where is the middle east equivalent of Radio Free Europe?
What is not required is appeasement. Appeasement often works in the short term but never in the long. The previous Government, as well as some of our universities and businesses, lost their moral bearings when it came to dealing with the Libyan regime. I happened to support Tony Blair and the invasion of Iraq, yet the complete contrast between that and what his Government did with Libya was astonishing. While senior new Labour Government figures hobnobbed with Gaddafi and his family, academic institutions accepted millions of pounds in blood money from the regime, and companies rushed to Libya to sign commercial deals. The London School of Economics, in perhaps the most shameful episode in the university’s history, went cap in hand to Gaddafi and treated him like some kind of king from over the water. I am glad that one of the professors implicated in that disgusting scandal resigned today, according to reports in The Times.
The leader of the Labour party talks about predator and producer capitalism, and I do not think there has been a more horrific example of predator corporate capitalism than the commercial dealings between the previous Government and so-called big business and the Libya regime. I do not say that to make a party political point; I just cannot get my head around how the previous Government could do some good things in Iraq but behave so disgracefully when it came to Libya. The release of the Lockerbie murderer, al-Megrahi, marked the low point of that kind of appeasement by the establishment, and I would argue that the political establishment’s flirtation with Gaddafi was akin to the appeasement of Hitler before the second world war by British upper-class aristocrats.
In having the courage to support intervention and ignore the armchair generals who said we could not or should not get involved, the Prime Minister did much to correct Britain’s moral compass, but I urge the Minister and the Government to launch a serious inquiry into the previous Government’s relations with Gaddafi. We must learn from what went wrong, so that we never, ever, do such a thing again with such an evil regime.
Bob Stewart
It was not so much the armchair generals. The armchair generals were right that we had no land forces that we could have put in. We did what we were able to do, which was to use our Air Force, but we certainly could not put troops on the ground, so the armchair generals and the Government were right to say that we could not do so.
Robert Halfon
I bow to my hon. Friend’s incredible experience in these matters, but I was not arguing about what kind of intervention it was. In fact, Britain has shouldered too heavy a burden, and other NATO countries should have done more. However, many so-called armchair generals argued against any intervention per se.
Daniel Kawczynski
Many British businessmen coming back from Tripoli have alleged to me that they heard that Mr Blair personally benefited financially from various transactions with the Gaddafi regime—
Mr James Gray (in the Chair)
Order. The hon. Gentleman is stepping beyond the usual realms of courtesy in this place.
Robert Halfon
I have made my point about the previous Government’s appeasement of Gaddafi, which sets the context, but I understand what my hon. Friend has said.
Of course, getting rid of a tyrant does not mean that we have got rid of tyranny. The experience of much of Iraq shows that the first steps after dictatorship are incredibly important. NATO and western Governments must continue to nurture genuinely democratic forces in post-Gaddafi Libya and help to rebuild the country. Any prospect of extreme Islamists or al-Qaeda gaining ground must be ruthlessly crushed. However, the threat of Islamists should not be overstated. They are less prevalent in northern Africa than in the rest of the middle east. It may take a few years to achieve democracy, but that was also the case in Japan and Germany after the second world war.
I am vice-chairman of the all-party parliamentary group for the autonomous Kurdistan region in Iraq. That region sets a precedent for democracy. The Kurdish people suffered chemical genocide under Saddam Hussein and lived in terror under the Ba’athist regime. I have visited the region, and I have seen the democracy, the rule of law, the religious tolerance, the free press and the vigorous political opposition. It can be done, and the Libyan transitional national council must do the same.
The signs are encouraging. There are reports that the Libyan leader of the opposition invited the representative of Libyan Jews in the UK, Raphael Luzon, back to Tripoli to take part in the political process. Yesterday, I met Mr Luzon, who is a senior Jewish politician, in the House of Commons. He is known by the key people in the transitional council, who, he said yesterday, invited him back to work with the Government and perhaps stand for office, which is a very encouraging sign.
As we reopen our embassy in Tripoli, now is the time for the British Government to encourage the forces of liberalism in Libya. We should impress on the national transitional council interim Government that we stand with them against Islamic fundamentalists, and that we hope they will revive a good relationship with Christians, Jews and other minorities.
I also hope that the Foreign Office can help to obtain compensation for exiled Libyan Jews. Gaddafi’s law 57 of July 1970 gave the Libyan regime powers to seize the property of Jews who had fled after the pogroms of 1967 and before. Not a penny in compensation has been paid to dispossessed Libyan Jews or other victims of the Gaddafi family. As the country reconciles, I ask the Minister to consider compensating victims and the families of those who have been killed with some of the assets sequestered from Gaddafi. We now know that Colonel Gaddafi’s son lived in some splendour in a large house in north London—bizarrely, it is not far from where I spent a few years of my childhood.
During the past 60 years, Arab states have ethnically cleansed ancient Jewish communities, creating the largest population of refugees in the region—far larger than that of the Palestinians—and incurring property losses many times greater. My grandfather lost his material possessions when he was forced to leave Libya, but at least he could get away and rebuild his life here, unlike the Libyan people who have been oppressed for so long. We hope that their suffering is coming to an end. I commend what the Government have done, and I hope that they will work closely with the new Libyan leadership to help them develop democracy. I look forward to visiting Tripoli when it is more stable and retracing my dear grandfather’s and father’s footsteps.
Ian Lucas (Wrexham) (Lab)
It is a pleasure to serve under your chairmanship, Mr Gray. I congratulate the hon. Member for Shrewsbury and Atcham (Daniel Kawczynski) on securing this timely debate.
I have limited time. I start with Robin Cook, as did the hon. Member for Shrewsbury and Atcham. With respect to him, he misquoted Robin Cook, as people so often do. Robin Cook, for whom I have great admiration, said on Monday 12 May 1997:
“The Labour Government does not accept that political values can be left behind when we check in our passports to travel on diplomatic business. Our foreign policy must have an ethical dimension”.
As the debate has progressed, that matter has become even more relevant to today’s discussion. The debate has been more backward-looking than I expected, but it is helpful to consider some of the points made as we look forward to the future of Libya and progress in that country, which hon. Members from all parties welcome.
I am sorry that there has been a partisan element to this debate, because I know that the speakers, whom I respect, believe in an ethical dimension to foreign policy. They seem, however, to have short memories. Robin Cook established his reputation in the arms to Iraq debate in the 1990s. That debate involved a Conservative Government, and—
Mr James Gray (in the Chair)
Order. We are drifting a little wide of the topic. We should focus on UK relations with Libya.
Mr James Gray (in the Chair)
Order. My ruling is that we return to the question under debate, namely UK relations with Libya. Nothing else is in order.
Ian Lucas
I accept your ruling, Mr Gray, although Hansard will record our previous discussion of other matters.
We need a balanced approach when considering the history of different parties’ approach to foreign affairs. From the outset, the Leader of the Opposition made clear his support for the Prime Minister’s decision to support, quite rightly, the actions in Libya. When difficult interventions were happening in Libya, he supported the Prime Minister throughout. Of course, there were times when particular aspects of policy were not succeeding, when the Opposition held the Government to account, as is our role.
There is now a broader consensus across the House on the ethical dimension of foreign policy. It is unhelpful to misrepresent the previous Government’s position—
Mr James Gray (in the Chair)
Order. The hon. Gentleman must now return to the question under debate, or he will resume his seat. We are discussing UK relations with Libya, not the ethical foreign policy of the previous Labour Government, or indeed any Government. The question is UK relations with Libya and nothing else.
Ian Lucas
I am delighted that last week, the UN voted unanimously to end the no-fly zone, which has now been lifted. The new resolution is another important landmark towards Libya’s democratic future. The state has a historic opportunity to build on human rights and to ensure that freedoms are protected. We in the United Kingdom have a great tradition of working with developing democracies to try to establish democratic values, and I know that the Minister will support that.
Britain’s future involvement in Libya is important. The shadow Foreign Secretary, my right hon. Friend the Member for Paisley and Renfrewshire South (Mr Alexander), warned in September how a liberated country can quickly become a lawless and violent one. We have seen the end of armed conflict in Libya, and we are now seeing a steady transition to democratic government. The country must now embark on the delicate process of developing institutions. We know from our own history how difficult that is in the aftermath of civil war—Oliver Cromwell was not able to build enduring institutions in the UK. The problems that Libya now faces are serious, so we need to ensure—I think that the hon. Member for St Austell and Newquay (Stephen Gilbert) put this well—that the Libyan people are at the forefront of addressing them. It is important that we support their work in developing institutions.
Will the Minister make clear how he sees our role with Libya developing? Will the emphasis be on bilateral relations with Libya, or will we continue to work through NATO or the UN? What is the current format for the working relationship with the new Libyan Government, and how will that develop?
There is a great appetite in the House for developing relations with Libya. It is a matter for not only the Government, but Parliament as a whole. I am sure that there will be interest throughout Parliament in developing the nascent democracy in Libya. There is great interest in establishing working links, as well as economic links, with Libya. Companies in my constituency already export to Libya and have done so for a number of years, which, to pick up what the hon. Member for Shrewsbury and Atcham has said, is something that we need to develop. There is no shame in that. The Defence Secretary was right to say that there are business opportunities in Libya, and I am pleased to hear that Lord Green has already visited Libya and is assisting in the rebuilding of that country in a way that suggests that we can contribute as a nation. We have an opportunity in both the democratic and commercial spheres to assist with the development of Libya.
Jim Shannon
After the Kuwait war and the tremendous contribution made by British armed forces to that victory, a number of British companies in Kuwait felt that they would have an economic advantage, but it did not happen. Following other contributors to this debate, does the hon. Gentleman feel that more could be done to ensure that British companies benefit?
Ian Lucas
It is important that we grasp the opportunity to contribute commercially, which means creating jobs in our own constituencies. We, as parliamentarians, have a responsibility to be outward-looking on occasions such as this. Perhaps we should not focus purely on issues such as Europe, when big issues are happening around the world. We should look at the opportunities in Africa, China and beyond. It is important that, in these extraordinary times, we use the increasing communication with countries such as Libya for the benefit of our own constituents.
Bob Stewart
The business infrastructure in Libya is excellent, if we consider that it is in Africa. We should waste no opportunity to get in there again. I know that a number of companies are already there and that British companies have been kind of operating throughout the troubles over the past six months. I totally endorse what the hon. Gentleman has to say.
Ian Lucas
I am grateful for the hon. Gentleman’s contribution. There are opportunities in the commercial sphere. A number of organisations have been referred to, such as the British Council and the Westminster Foundation for Democracy, and I add the BBC World Service, which can make a positive contribution to building democracy in Libya. We have a huge opportunity.
I have not visited Libya, but it is extremely important and has massive potential. It is a neighbour of countries that are becoming increasingly important, such as Egypt. Will the Minister touch on how he sees those relationships within the new Mediterranean developing as we progress? We are in extraordinary times in north Africa and the middle east, because the changes are having profound effects on our relations and on the lives of and individual possibilities for the people of Libya.
We have long-established relationships with Libya, for many of the reasons that have been referred to in this debate. We should use those opportunities to assist the people of Libya, who must lead what happens. We must be prepared to stand ready to assist whenever we are asked. We have much to give.
The Minister of State, Foreign and Commonwealth Office (Mr Jeremy Browne)
Thank you, Mr Gray, for allowing me the opportunity to conclude the debate. It is an honour for me to serve for the first time under your chairmanship and to follow the hon. Member for Wrexham (Ian Lucas). I pay tribute to my hon. Friend the Member for Shrewsbury and Atcham (Daniel Kawczynski), not only for giving us the opportunity to discuss this important and topical issue, but for his ongoing interest in Libya. I apologise on behalf of the Under-Secretary of State for Foreign and Commonwealth Affairs, my hon. Friend the Member for North East Bedfordshire (Alistair Burt), who has specific responsibilities for north Africa and the middle east, and would, in normal circumstances, reply to this debate. He is, however, travelling, so I will respond as his colleague in the Foreign Office.
As has been made clear, events in Libya over recent months and days have offered the opportunity to change radically the United Kingdom’s relationship with Libya, to the benefit of both British and Libyan citizens. The end of the Gaddafi regime, the national transitional council’s declaration of liberation just over a week ago, and the end of the UN-mandated no-fly zone just yesterday mark the beginning of a new era in Libya’s history. After 42 years of brutal repression under Gaddafi, Libyans can now look forward to a brighter, more secure and prosperous future, and a new start in Libya’s relationship with the international community, including us in the United Kingdom.
In responding to the many points that have been made on the nature of the new relationship, I would like to focus on two aspects. The first is the role that the United Kingdom has played to date in helping bring this opportunity about. Secondly—the hon. Member for Wrexham made this point—I want to focus on our plans for future relations, as well as dwell on the recent past.
The Government are proud of the role that Britain has played in establishing and implementing the NATO mission to protect Libyan civilians. The international community, led by the United Kingdom, stepped in because it was necessary, legal and right to do so. We could not stand by and let Gaddafi commit atrocities against his own people in order to cling to power. We are likewise proud of the role that the United Kingdom has played in building international support for the new Libya, not least through the unanimous adoption of UN Security Council resolutions 2009 and 2016 in recent weeks.
Over recent months, at the request of the national transitional council, the United Kingdom has also offered advice on stabilisation and committed more than £20 million of assistance to support the NCT’s stabilisation plans. In April, we opened a mission in Benghazi, and were among the first diplomatic missions to re-establish ourselves in Tripoli after its liberation in August. Together with the French President, my right hon. Friend the Prime Minister was the first Head of Government to visit Libya after Tripoli’s fall. My right hon. Friend the Foreign Secretary accompanied him on that visit, and also made a separate visit last month, when he was able to announce the formal reopening of the British embassy and the appointment of Sir John Jenkins as the new British ambassador to Libya.
Although the Government are proud of that role, we have also been clear throughout that it has been a Libyan-led revolution. That is as true of post-conflict stabilisation as it was during the conflict. Now that liberation has been declared, Libya has an historic opportunity to create a peaceful, democratic and prosperous state, where human rights are protected and all its people benefit from its considerable natural resources. As the Foreign Secretary said last week, that would be a fitting tribute to those who sacrificed their lives for future generations. We welcome the clear and consistent messages from council leaders cautioning against disorder and, crucially, against reprisals, as mentioned during our discussions.
Establishing the new Libya will involve building infrastructure in every aspect of life, for example: political democracy and inclusion, the rule of law, security, migration, commerce and civil society. It is for the Libyan people to decide how to govern themselves. The UK will continue to stand shoulder to shoulder with the Libyan people in that process, as they form a transitional Government within 30 days of liberation and rebuild a free and democratic country.
In a moment, I will touch on our plans for helping Libya in how it goes about that process, but, first, I will address an issue that straddles both Libya’s past and future, an important element of our relations with the new Libya and something on which we have been working with the NTC over recent months: the crimes committed by the Gaddafi regime. That has been a particular focus of the comments of my hon. Friend the Member for Shrewsbury and Atcham not only in this debate, but over many months and years. Our relationship with Libya has been scarred over the decades by the horrific actions of the Gaddafi regime, including the killing of WPC Yvonne Fletcher outside the Libyan embassy in London in 1984, the bombing of Pan Am flight 103 over Lockerbie in 1988 and Gaddafi’s support of IRA terrorism in Northern Ireland and here on the UK mainland.
A new Libya offers the chance to revitalise the relationship between Britain and the new Libyan authorities. Part of that process must involve resolving those outstanding so-called legacy issues. As my right hon. Friends the Prime Minister and the Foreign Secretary have made clear both to the new Libyan authorities and the House, that is an important priority for our Government. The Foreign Secretary last raised those issues with Chairman al-Jalil of the national transitional council during his visit to Tripoli on 17 October, just a fortnight ago.
The Metropolitan police and Dumfries and Galloway police will return to Libya to conclude their investigations once an interim Government are in place. We will seek restitution and reconciliation for the victims of IRA violence. Chairman al-Jalil and Prime Minister Jibril have assured us on many occasions that they will work with us on those issues but, as they have pointed out—I am sure hon. Members will think that they have done so with valid reason—they need to form a Government and have functioning Ministries to be able to deliver their side of that commitment.
Mr Browne
The short answer is no. I have not had a clear indication, but I share the hon. Gentleman’s concern. If I can sum up the sentiment of the debate, I think we all feel uncomfortable about the manner of Gaddafi’s death, even if we do not lament his passing. I, and I am sure the whole House, hope that Libya’s future will be based on the rule of law, not reprisals. Although Colonel Gaddafi was the most high-profile Libyan, I hope that his death is not indicative of the state of justice and the construction of society in the new Libya that will unfold in the months and years ahead.
As well as resolving issues from Libya’s past, we will work closely with the new authorities on the issues critical to Libya’s future. Security is a key concern, even though the new authorities are making steady progress and police are returning to the streets. The national transitional council has planned for a proper police force and a national army that integrates many of the revolutionary forces. We are offering help in that process, including through the presence of a British policing adviser and with communications and logistics for the new police forces. We are helping the NTC to secure and disable man-portable air defence systems, and we are supporting mine clearance in Misrata, Benghazi and other affected areas. We will also offer technical advice to help with the destruction of remaining Libyan chemical weapons stocks under the auspices of the Organisation for the Prohibition of Chemical Weapons.
The Government are also working with the International Criminal Court in The Hague to pursue and bring to justice the remaining indictees, Saif al-Islam Gaddafi and Abdullah al-Senussi. We want to ensure that they are held accountable for violations of human rights and international humanitarian law, and for the attacks targeting the civilian population perpetrated by them. We are encouraging all Libya’s neighbours who are ICC state parties and have a legal obligation under the Rome statute to co-operate with the ICC, including on enforcing ICC arrest warrants should those individuals enter their territory. UN Security Council resolution 1970 urges all UN member states to support the ICC investigation and implement the arrest warrants. We are making that position very clear.
The UK has played a leading role throughout in responding to Libya’s humanitarian problems. We have provided support through the International Committee of the Red Cross and supplied surgical teams and medicines to treat up to 5,000 war-wounded patients. We have also brought 50 severely wounded Libyans to the UK and are providing treatment in the UK to another 50 Libyans who have suffered amputations during the conflict. UK medical experts are also working with Libyan medical staff and are training them in the care of those who have been brought to the UK, so that they can take that knowledge back to Libya and work with others who have suffered such terrible injuries in the fighting.
Women and young people have an important role to play in rebuilding Libya. We are engaging with women across different sections of Libyan society to determine how best to provide support. That includes looking at the issues that women face as a result of the conflict and how women can participate in developing a new Libya.
Bob Stewart
I shall make only one point. I suspect that the Minister will not mention the matter of Crown Prince Mohammed, but perhaps he could write to me and my hon. Friend the Member for Shrewsbury and Atcham (Daniel Kawczynski) about what exactly the Foreign and Commonwealth Office’s attitude is towards the Crown Prince, who seems a very decent man.
Mr Browne
I am grateful for that intervention. Let me make it clear: the British Government do not have a position on the ideal constitutional arrangement for the new Libya. That is a matter for the Libyan people to determine for themselves. There will be a referendum on the constitution of Libya. On the point made by my hon. Friend the Member for Shrewsbury and Atcham, there will be an opportunity for the Libyan people to express their support for the arrangement that is put before them.
Let me finish by talking about trade and commerce, which was raised by many contributors. Getting the economy running again in Libya is crucial to achieving political progress and stability. We are committed to helping the Libyan authorities build a strong and sustainable economy. Through UK Trade and Investment and our embassy in Tripoli, we are providing advice and assistance to British businesses, so that they are ready to compete for business opportunities now and in future, when the time is right for their business.
In late September, Lord Green, the Minister responsible for trade and investment visited Libya. He met senior leaders, who assured him that all legally obtained contracts would be honoured and new business welcomed. He discussed business prospects arising from the estimated $200 billion post-conflict reconstruction programme and, the day after his visit, Lord Green briefed more than 150 UK companies on how the Government planned to support their engagement in Libya. The Export Credits Guarantee Department has agreed to provide insurance cover for business deals up to a total of $250 million. That is an initial tranche of cover and it will be re-evaluated at regular intervals.
The Libyan people have now embarked on the transition to a pluralist and democratic society. Although we should not expect that that will always be a smooth path, the UK will continue to support Libya in that goal and in building a revitalised relationship between the United Kingdom and Libya that addresses past wrongs and lays the foundation for future progress. The NTC’s goals are ambitious, but already it has many times proved wrong those who underestimated it. We have confidence that it can continue to do so, and that a new bilateral relationship between Britain and Libya will bring greater benefits to the people of both our countries in future than at any point over the past four decades.
Regional Growth Fund
(12 years, 6 months ago)
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Mr James Gray (in the Chair)
We now come to a debate on UK relations with Libya. I beg your pardon; we do not. That was an extremely good debate on the UK’s relations with Libya, which I enjoyed very much. We now come to a debate on the effectiveness of the regional growth fund.
Angela Smith (Penistone and Stocksbridge) (Lab)
I am mightily relieved that the topic is not Libya, Mr Gray, because my notes do not refer to it in the least. I am pleased to have secured this debate on the regional growth fund. I want to start by putting the fund in the context of the economy as a whole. There is no doubt that the British economy is in trouble. We have a growth crisis. Year-on-year growth has all but vanished, with this morning’s Office for National Statistics growth forecast for quarter 3 at 0.5%, and with construction already in negative territory. Unemployment is at levels not seen since Margaret Thatcher was Prime Minister, and is rising at an alarming rate. Worse still, the young are paying the heaviest price, with youth unemployment at almost 1 million.
Worryingly, unemployment is rising at a much faster rate in the regions than in London or the south-east, as Government cuts bite more heavily into the regions. Already, the unemployment rate in Yorkshire and the Humber is almost twice that in the south-east, according to ONS figures. Inflation is running at more than twice the Bank of England’s target rate of 2.5%, while average incomes are rising at half that rate. That means, as the Governor of the Bank of England said recently, that families are experiencing the biggest squeeze on their incomes in living memory.
The Minister, in his response to the debate, will undoubtedly claim that our growth problem is due to the eurozone crisis. No. The blame must lie at the doors of No. 11 and No. 10 Downing street. Our economic growth has faltered thanks to a reckless slashing of investment by this out-of-touch Government. Yes, in 2008 the global economy did go through the worst financial crisis, and subsequently the deepest recession, since the 1930s, and yes, the British economy was badly affected by the irresponsibility of banks over-lending, but since the Government came to power, the UK economy has stagnated, as I have pointed out. Since last autumn, only earthquake-hit Japan has grown more slowly than the UK in the G7. There is no doubt that the Government’s policies are hurting, but they are certainly not working. Today, I want to spell out that it is not just that the Government are not doing enough to help our economy grow; what they are doing, they are doing badly.
The previous Government’s key tools for regional economic development were the nine regional development agencies covering the country. Those tools for investment enjoyed significant Government support both politically and financially, with a budget of approximately £2 billion a year. I think that in the last year of the Labour Government, the budget was £1.7 billion. The Conservatives made no secret of their desire to abolish the RDAs if they won the general election—they did not win it, but they are in power thanks to the Liberal Democrats—but they were very light on what they thought should replace them.
Mr Marcus Jones (Nuneaton) (Con)
The hon. Lady seems to be extolling the virtues of regional development agencies. Would she not acknowledge that in the west midlands private sector employment actually fell under the RDAs?
Angela Smith
This debate is not about the RDAs. The point that I will make, as the hon. Gentleman will see, relates to the level of investment made by RDAs, as compared to the regional growth fund. We now know what the Government’s alternative is—the regional growth fund. On the evidence to date, the fund represents chaos and confusion, with too little being awarded too late to make any significant contribution to promoting economic growth.
There are three aspects to the Government’s approach to regional investment. The first is local enterprise partnerships, which are unfunded apart from a small start-up fund, and have no clout. The second is enterprise zones, which are a tired blast from the past with a mixed track record when it comes to delivering jobs and growth. The third prong of the Government’s regional growth strategy is, of course, the regional growth fund, and yesterday the outcome of the second round of bids was announced.
Neil Carmichael (Stroud) (Con)
There are many other prongs, but the fourth prong that I would have mentioned is the enhanced role of local authorities—their powers of competence, and their capacity to deliver planning decisions that will build businesses.
Angela Smith
I thank the hon. Gentleman for his intervention, but it has already been established this morning that the Humber is actually going backwards because of the cuts to local authorities, so I do not think that that is quite true.
We were told yesterday, in a written parliamentary statement, that 119 bids had been awarded funding. That is just a quarter of the bids submitted. Clearly, there were far more losers than winners, with more than 370 bids rejected. Bids totalling more than £6 billion have been submitted in rounds 1 and 2 of the RGF. That says something about the scale of the unmet investment needs of business, and how little the Government are delivering to meet that need.
The RGF was announced on 29 June 2010, alongside the proposals for the LEPs. A Department for Business, Innovation and Skills press release described the RGF’s purpose as being
“to help areas and communities at risk of being particularly affected by public spending cuts”.
However, current guidance from the Department goes into a little more detail:
“The objective is to stimulate private sector investment by providing support for projects that offer significant potential for long term economic growth and the creation of additional sustainable private sector jobs.”
When announced, the original fund was £1 billion, but the 2010 spending review extended the total value to £1.4 billion over three years—from 2011 to 2014. To put those figures in perspective, as I mentioned earlier, the annual budget for the RDAs averaged £1.7 billion in their last few years of operation. The Government’s total spending on the RGF over a three-year period will be just £1.4 billion. One does not have to be Einstein to see that the RGF represents a two-thirds cut in regional investment, which is an indication of where the Government’s priorities lie and that they are certainly not supporting the regions. The Government use a lot of warm words, but deliver very little when it comes to economic investment. There is a really good northern phrase to describe a person who appears to have everything, but who in fact has nothing much to offer: “all fur coat and no knickers”. I have to say that that seems a rather good description of the Government’s approach to regional growth.
It will take more than warm words to persuade businesses up and down the country that the Government have what it takes to kick-start growth in the economy, which has flatlined since last autumn. It is obvious that there is much demand out there for regional investment; rounds 1 and 2 of the fund were over-subscribed many times over. In the first round of bidding, 478 bids were received, with a value of £2.78 billion. Only 50 bids were successful, and only five have received any money so far—hardly the success to which the Government lay claim. Given that so few bids from the first round have progressed to the point where they have fund money in the bank, how on earth can we expect the Government to deal effectively with the 119 announced yesterday?
On top of that, it is absolutely clear that the Government’s approach to regional investment is far too centralised. In an era of so-called localism, how can the Deputy Prime Minister, Lord Heseltine or the Secretary of State for Business, Innovation and Skills justify a bidding process that is governed and determined by Whitehall, particularly given that the investment framework that it replaced was regionally based and closely attuned to the strategic needs of the regions?
Laura Sandys (South Thanet) (Con)
I am very lucky, because east Kent received regional growth fund money yesterday. The structure of each of the funds is very different, depending on the local circumstances. Our regional growth fund is transferring to small businesses, and will be transferred to an organisation that will be totally locally focused, and accountable to the local businesses and the employment that we need to create. It is a tailored scheme that reflects the needs of each individual region and its specific employment profile.
Angela Smith
The fact that the decisions are made by Whitehall is not altered by anything that the hon. Lady has said. One member of the panel that assesses bids for the growth fund, Mr Moulton, is himself benefiting from the fund to the tune of £5.9 million, which is paid to a company called Redx Pharma, in which he is an investor with a stake of about 26%. Would the hon. Lady like to say anything about the fact that there is not much clarity or transparency in that process? That was not the case with the previous arrangements for distributing regeneration money.
Laura Sandys
Our fund in east Kent will be extremely transparent to the business community; it will be accountable to business by delivering jobs on the ground. It will not be something distant, based in Whitehall. In the south-east, the operation used to be based in Guildford; there was not very much on the ground in Margate and Ramsgate.
Angela Smith
A Government who trusted the voice of the northern regions, and their intimate knowledge of their manufacturing base, would never have cancelled the Forgemasters loan. [Interruption.] If the hon. Lady thinks that is funny, people in Sheffield and south Yorkshire do not. Yesterday we heard an acknowledgement that the Government got it wrong on Forgemasters, and they have awarded a consolation prize, but nothing takes away from the fact that the original purpose of the loan has passed, and an important strategic opportunity has passed us by, thanks to the spiteful attitude of a condemned Government hellbent on cancelling what they saw as a Labour loan.
Mr David Blunkett (Sheffield, Brightside and Hillsborough) (Lab)
I congratulate my hon. Friend on this timely debate, and on her work on Forgemasters last year. Is it not a serious issue that although a previous Government—including the Department for Business, Innovation and Skills and the Treasury—did up to two and a half years of due diligence on the proposed loan to Forgemasters, in the past two and a half months, no such due diligence has been done? Despite the warm welcome for the money announced yesterday for Forgemasters, the board has not even approved the detail of how the investment is to be made. Last year, the Deputy Prime Minister wrongly described the original decision as political, but we now have a most vivid example of such a decision, with the Deputy Prime Minister arriving at Forgemasters, seeking to make a political gesture out of public money.
Angela Smith
I completely agree with my right hon. Friend. The Deputy Prime Minister would have been better served yesterday had he acknowledged to the people of Sheffield that he got it wrong and they got it right. If he had shown some humility and apologised for the grave errors that his Government made more than a year ago, perhaps the political point that he was making would have carried a lot further.
One of the issues at the heart of the chaos and confusion surrounding the regional growth fund is the bureaucracy at the heart of the process. For instance, the rules for the fund state that payments will only be forthcoming on successful delivery of outputs. That means that private companies are being asked to invest up front, with the risk that, if they do not make the said outputs in two or three years, they will not receive the moneys promised. That means that the promise to Forgemasters is exactly that: only a promise. That, I am told, is not only putting off many smaller companies from applying, but is making the writing-up of contracts difficult for the successful companies due to the risks involved. In that context, the comments made to me yesterday by the Institute of Chartered Accountants are damning. The institute has been working with BIS officials to make the process simpler and more cost-effective, but it says:
“However, following discussions with our members, BIS officials and firms, we fear that a convoluted approach to the due diligence process for the RGF is resulting in delay, additional bureaucracy and cost for businesses and the government, and undermining the growth goals that the RGF money intends to achieve.”
Those are not my words, but those of the Institute of Chartered Accountants—a damning indictment of the Government’s approach to regional investment.
To make matters worse, the minimum bid for an application to the fund is £l million, with typical leverages of eight to nine being demanded. That means that the fund is out of reach to the average small or medium-sized enterprise—the sectors that the Government say they want to help the most. The Federation of Small Businesses said to me yesterday:
“From our point of view, the minimum amount for bids of £l million has always been far too large for the majority of small businesses. We did encourage collective bids to be made on behalf of SMEs, however this is not ideal.”
Derek Twigg (Halton) (Lab)
I praise my hon. Friend for her fantastic campaign on Sheffield Forgemasters, which has resulted in at least a partial climbdown. I gather from what she is saying that we now have a system in place that not only has a lot less money, but is more bureaucratic and more difficult for firms to access. She is right that that is causing a lot of consternation in the business world and among private firms, not least in the manufacturing industry.
Angela Smith
My hon. Friend is right. The growth figures today show that we are heading for a gross domestic product growth increase of 0.5% over the past year, which is a significant slow-down from the 2.6% registered in the last year of the Labour Government. It is appalling that the Government do not seem able to resolve issues to do with releasing investment to manufacturing and businesses up and down the country, and do not seem able to ensure that the funding flows quickly to the companies that need it in order to secure our economic future.
Jason McCartney (Colne Valley) (Con)
I thank the hon. Lady—my neighbour in West Yorkshire—for giving way, but I found your partisan language, your doom-mongering and your negativity quite shocking, which is a shame.
Mr James Gray (in the Chair)
Order. I will have no part of doom-mongering and such language.
Jason McCartney
One minute, the hon. Member for Penistone and Stocksbridge (Angela Smith) is happy that Forgemasters is getting a loan, and the next she is unhappy—she seems unhappy with both. May I confirm that she welcomes the regional growth fund as a scheme, but for the tinkering with the details and the learning as we go on with different bids? Does she join Government Members in welcoming the scheme and the way in which it invests in businesses, as it did in David Brown’s in my constituency?
Jason McCartney
That was a £2 million investment, which will secure 80 new jobs.
Angela Smith
I would welcome recognition by the Government that we need far more than what is on offer on the table. We need proper decentralisation of the decision-making processes, more transparency, and a more efficient way of delivering funds to companies. The chances of such funds delivering significant economic growth are about as good as the chances of Huddersfield football club getting a promotion to the championship next year.
Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab)
My hon. Friend is making a valid case. Opposition Members do welcome the regional growth fund, but I will welcome it even more when it actually arrives, as so far only eight businesses have received any funds. Our concerns are reiterated by the EEF, the manufacturers’ association, which is cited in The Northern Echo today. It wants to ensure that
“the funding promised flows through directly to the projects concerned as a matter of urgency.”
Is the current speed at which cash is going to businesses urgent or slow?
Angela Smith
My hon. Friend is right. It is not only slow; there is inertia at the heart of the Government’s approach to investment in our economy. That is all down to the Chancellor of the Exchequer, who said this morning, when asked by the BBC, that this is a difficult journey for the UK economy, but that we are determined to complete it, so that we have jobs and growth—only warm words, once again. He will not admit that he has got it wrong, or that he needs a plan B, and that is at the heart of the problem we are facing.
Fiona Bruce (Congleton) (Con)
The hon. Lady said that small and medium-sized enterprises will not benefit. Does she not agree that the supply chain benefits are enormous? Let me cite the successful bid of Pochin’s of Middlewich in my constituency for £4.1 million, announced yesterday. That will result in the creation of 3,600 new jobs, ultimately, and safeguard a further 200 in the region. Many of those jobs will be in SMEs.
Angela Smith
I am sure that hon. Members have come here today to congratulate the companies that were promised money in yesterday’s announcement. Any investment is welcome, but I remind the hon. Lady that the Government cancelled a significant investment in the nuclear industry supply chain 18 months ago. That is what the Forgemasters loan was about, and that is why the Government are seriously damaging the economy. We are talking about a major supply chain that would have ensured that the UK and its manufacturing base were at the forefront of the building of the next generation of nuclear power stations.
How businesses access the fund is a problem, as the Minister admitted in an article in The Times:
“There have also been problems where, given the financial uncertainty from June onwards, it has proven very slow to unlock that private capital.”
So where are we with the Government’s regional growth strategy? It is quite obvious that the Government’s thinking is muddled to say the least. They have dismantled the Labour Government’s regeneration framework and replaced it with a rickety framework, fed with inadequate resources spread very thinly. Worse still, this comes at a time when help is most required by many of the regions because of the Government’s desire to cut too far and too fast.
So what should we be doing to jump-start growth? Labour’s plan to repeat the bank bonus tax, and to use the funds to build 25,000 desperately needed homes and secure jobs for 100,000 young people, would help, as would bringing forward long-term infrastructure projects. We got a start on this yesterday, but we need more. For the medium term, I agree with the Leader of the Opposition when he says that we need to change the very nature of our economy. We need to go back to making things, to give manufacturing a much bigger role in our economy, and we need an economy that looks at the long-term, and not just to short-term profits.
Mr Marcus Jones
I thank the hon. Lady for giving way; she is being generous in taking interventions. She tells us how important manufacturing is to rebalance our economy, yet in 13 years of Labour Government, on her party’s watch, we lost 1.7 million manufacturing jobs.
Angela Smith
I think the hon. Gentleman overlooks the fact that the Labour Government were prepared to show what is called industrial activism. They worked hard for a long period to ensure that due diligence was in place, and that we invested in key sectors of our manufacturing economy. The hon. Gentleman’s comment is a bit rich, given that the production industries have gone into negative growth in the last quarter. Mining and quarrying took the productive part of the economy into negative growth in the last quarter, so I do not think that we need any comments from Government Members on manufacturing and support for manufacturing.
Phil Wilson (Sedgefield) (Lab)
I do not know whether my hon. Friend is aware of this, but the regional growth fund for north-east England will create some 8,500 jobs over three years. That is equivalent to the number of jobs lost in the north-east in the past three months.
Angela Smith
That is precisely the point. That underlines the fact that the Government are cutting too far and too fast. Their policies risk producing a double-dip recession.
Tom Blenkinsop
Another interesting statistic came out today: the purchasing managers index for manufacturing output slumped to 47.4%, below the 50% figure, which is an early indicator of a downturn in manufacturing. That is a scary statistic for us all to take on board.
Angela Smith
I completely agree with my hon. Friend. I repeat that we need an economy that looks at the long term, and not just short-term profits. We need to invest in innovation. We need a co-ordinated, well-funded regional growth strategy, not the disparate, unco-ordinated approach that represents too little, too late, from a Government who have fallen asleep at the wheel and lost their way as far as economic growth is concerned.
David Tredinnick (Bosworth) (Con)
I congratulate the hon. Member for Penistone and Stocksbridge (Angela Smith) on securing the debate. I have listened to her complaints about Government strategy, but I will not dwell on those, because I am sure that the Minister, who was making notes, will have a few things to say about that.
I want to address the issue of the regional growth fund and explain why it has been fundamentally important to my Leicestershire constituency, which sits on the boundary of the east and the west midlands. The Government’s decision yesterday to grant regional growth fund second round support to the MIRA technology park will make a huge difference not just in my constituency—my hon. Friend the Member for Nuneaton (Mr Jones) nods his head—but right across the midlands, because it will impact on some of the areas with the greatest problems.
The new MIRA technology park, which desperately needed regional growth fund status, was approved by Her Majesty’s Government in August. This new technology park will attract up to £300 million—perhaps more—in private investment. It is also likely to create and be responsible for up to 5,000 sustainable jobs. We can argue about the numbers—it depends on the catchment area—but it is a massive boost to industry in the heart of England. I represent the heart of England where the Fosse way crosses Watling street. We expect 200 jobs to be in place by 2013, largely based in a 43,000 square metre state-of-the art engineering centre, and a 155,000 square metre research and development facility, which will incorporate a new technology park.
Richard Burden (Birmingham, Northfield) (Lab)
I agree with the hon. Gentleman about the importance of MIRA. I congratulate it on being successful, with the promise of RGF money, as indeed Jaguar Land Rover was a little while ago. However, does he agree with my hon. Friend the Member for Penistone and Stocksbridge (Angela Smith), who said in opening the debate that the promise of money is not much use unless it is actually delivered in practice? The Government need to think about how they can deliver RGF money rather than just make promises.
David Tredinnick
I understand that the hon. Gentleman speaks on behalf of his motor manufacturing constituency. Obviously, there is demand for more regional growth fund support. Where we are now with the RGF is very helpful, and it is successful for reasons that I will develop.
Mr Marcus Jones
I am proud to have worked with my hon. Friend the Member for Bosworth (David Tredinnick) in promoting the MIRA enterprise zone and RGF bids. Does he agree that it shows the importance of cross-boundary working, with his constituency in the east midlands and my constituency just over the width of the A5 in the west midlands? The fact that the local enterprise partnership for Coventry and Warwickshire has strongly backed the MIRA development shows how the new system is starting to work and bear fruit.
David Tredinnick
I absolutely agree with my hon. Friend, who has worked tirelessly for this project. I sat with him in his council chamber—in his former chair, I think—in Nuneaton not long ago and considered these issues. We can talk about the boundaries—parish, borough, county and regional—in the areas that we represent, but the point is that the footprint of the MIRA park is enormous. It covers a very large area of the east and the west midlands—areas that desperately need help.
I will return to the subject of the debate, Mr Gray, before you call me to order. I would not want to fall foul of the Chair. There were many concerns earlier this year when MIRA did not succeed in round one of the RGF because the technology park really could not succeed without that support. We are talking about not an add-on, or bells and whistles on a machine, but part of the gearbox without which the project could not go ahead. There has been huge investment on this former bomber aerodrome site.
Mr Jones
I assure my hon. Friend that I will not take much more of his valuable time, but does he agree that in addition to the growth and jobs that the MIRA development will create, RGF funding will also change the physical complexion of the A5? It will therefore benefit not only the MIRA development, but the east and the west midlands, which rely heavily on the A5 corridor.
David Tredinnick
My hon. Friend is right. I do not want to detain the House for long as many colleagues wish to speak, but I shall refer him to correspondence that I have received from worried constituents and former councillors on transport issues such as not improving the roads, traffic flows that, when measured seem to be too great for the existing roads, and problems on the A444/A5 Red Gate junction, which he will know well. There are also other local issues such as Higham lane roundabout—all concerns about the national highway. With the second round of applications to the regional growth fund, we will solve those problems and all those roundabouts and junctions will be improved. Indeed, the roads must be improved because otherwise heavy vehicles cannot get in safely. As MIRA said, subsequent to the RGF2 bid submission, those improvements will go ahead.
MIRA technology park will receive £20 million from the regional growth fund. I spoke to MIRA’s chief executive yesterday and looked at other aspects of the scheme, and I understand from the Minister’s Department that one or two issues concerning the impact on traffic and traffic changes need to be resolved. I thought that the Department had already dealt with such matters, but I have received reassurances that such problems will not obstruct the bid. I hope that the Minister will address that concern in his response.
The huge knock-on effect of the bid will not be confined to businesses but will have a massive impact on education and apprenticeships. Another leap forward that the Government have made is to improve, invigorate and release more people into the apprenticeship structure. Astonishingly, the Labour Government never really cracked that issue over 13 years. They were always out of kilter; there were never enough plumbers or enough this or that. It was a command economy approach that did not work. We are now freeing up the economy and giving people more responsibility. [Interruption.] I love heckling, Mr Gray, and if we had the time, I could not get enough of it. Seriously, however, we are talking about important issues.
Last night representatives from further education colleges visited the House, including Marion Plant from North Warwickshire and Hinckley college. We talked about the importance of developments such as the new Hinckley campus and the studio school that will come on stream in September 2012 with design apprenticeship training, and courses in advanced engineering and health and social care. She told me that there had been 500 applications for nine places. The demand exists, and we are heading in the right direction.
Last Friday I was contacted by Radio Leicester which asked me to do an interview about the increase in the number of apprenticeships in my constituency. I have received one or two other requests in the past, and I accepted that one immediately. There has been a phenomenal increase in apprenticeships in my constituency, which embraces Hinckley and lies adjacent to Nuneaton.
In summary, for all the complaints made by the hon. Member for Penistone and Stocksbridge—and I am sure there will be many other complaints from Opposition Members—something is stirring in the heart of England. Under this Government, there are more apprenticeships, and we are allowing institutions such as North Warwickshire and Hinckley college more say about how they run their affairs. There is less top-down government. I have just come from the Health Committee. We will not go into that issue now, but the Government are trying to give more power to doctors, which I welcome. The Government are succeeding in what they are doing, and the regional growth fund is an important part of that. I congratulate the Minister and his colleagues.
Phil Wilson (Sedgefield) (Lab)
It is a pleasure to serve under your chairmanship today, Mr Gray, and I congratulate my hon. Friend the Member for Penistone and Stocksbridge (Angela Smith) on securing this debate.
I will be brief because other Members wish to speak and we obviously want to hear contributions from the Front-Bench spokesmen. First, I would like to congratulate those firms in my constituency that have received money from the regional growth fund—Kromek Ltd, Permoid Industries Ltd, Carlton & Co., Hydram Engineering Ltd and ThyssenKrupp Tallent Ltd. Those highly-skilled organisations will produce jobs in the future. As I pointed out, however, although the regional growth fund will create around 8,500 jobs in the north-east of England, that is about the same as the number of jobs that have been lost in the north-east over the past three months.
James Wharton (Stockton South) (Con)
The hon. Gentleman is right to mention estimates that suggest that the current round of regional growth fund funding for the north-east will create 8,500 direct jobs. In addition, however, there will be 17,000 indirect jobs. The previous round of funding, in which our region did exceptionally well, is estimated to have created a further 5,200 direct jobs, and 8,400 indirect jobs. The figures are higher than one might believe if we listened only to the comments made by Opposition Members.
Phil Wilson
Those jobs will come on stream over the next few years. North-east England now has the highest unemployment in the country, and we are grateful for everything that we receive from the regional growth fund. We should not forget, however, that the fund for regional development is only one third of what it was under the previous Government. The problem with the regional growth fund is that it does not provide a strategy for the regions. A company applies for a grant, and if they get it that is fine, but if they do not, they do not. The fund is led not from the regions but from Whitehall; it should be renamed the Whitehall growth fund.
I have one or two questions for the Minister to which I hope he will reply. They concern the delay experienced by companies in receiving the money for which they applied in the first round—hopefully, they will not have the same problems this time round. The issue seems to concern the need for due diligence. Under the previous Administration, except in complex cases, the regional development agencies would be responsible for due diligence and absorb the cost. I have asked the Library to look into the matter, but as I understand it, under the present regime, due diligence has to be secured and paid for by the applicant out of the grant. Is that a reason for the delay in companies receiving their funding? Why are we asking applicants to find someone to look into issues of due diligence, and why does money for that come out of the grant? Under the old system, that was not the case.
In conclusion, one of my concerns as a north-east MP is that although the Scottish Development Agency exists north of the border, there is no similar body in the north-east. People say that regional development agencies are a waste of money and so on, but I would defend One North East, which has been very good. If something ain’t broke, don’t fix it—it was a major mistake of the Government to abolish that RDA in the north-east, especially when one exists north of the border. In the south of England, the number of companies in distress or facing bankruptcy are in decline, while in the north-east, they have increased by 20%. There are concerns in the north about the strategy. The second round of applications to the regional growth fund has finished. What will happen between now and the next election as far as regional development and regional grants are concerned? It seems that there is no strategy on that. I am especially concerned about the issue of due diligence because that may explain why delays are occurring, and I hope that the Minister will respond on that issue.
Esther McVey (Wirral West) (Con)
I congratulate the hon. Member for Penistone and Stocksbridge (Angela Smith) on bringing this timely debate to Westminster Hall. However, having listened to what has gone on, I think that we need to put the debate in context, so here goes. We have to look at the time when the coalition Government took office. We had the biggest deficit ever in peacetime history. We were paying £120 million in interest per day. Labour did too little, too late, and left us with a busted flush. The UK economy has grown by 0.5% in the third quarter of 2011, according to the Office for National Statistics.
Tom Blenkinsop
If, as the hon. Lady says, the economy was in such a bad situation when the coalition Government came to power, why did the Chancellor of the Exchequer predicate the deficit reduction plan on 3% growth? To date in 2011, we have growth of less than 1%, which has led to extra borrowing of £46 billion plus.
Esther McVey
No, the hon. Gentleman will find that his party left the economy in so bad a situation that we not only had to say, “You will live within your means and spend what you have,” but we had to provide a growth structure so that we could rebalance the economy.
Esther McVey
Not yet. Let me proceed to put the debate in context. Hon. Members talked about the regional development agencies. I will talk favourably about the Northwest Development Agency because the staff there are superb. I have worked with many of them and have a lot of time for them. However, let me give the statistics. From 1990 to 1999, annual growth was 1.7% in the north-west and 2.3% in the south-east—a gap of 0.6%. Between 2000 and 2008, average growth was 1.5% in the north-west and 2.1% in the south-east. We kept that gap of 0.6%, despite spending £3.7 billion over a decade.
Esther McVey
No, I will not. Therefore, we now have to ask how we will spend money better, how we will live within our means and how we will rebalance the economy. I talk as someone who had her own business for the last 14 years. I have set businesses up and sold them. I also set up the biggest business network for women in the north-west, involving more than 9,000 business ladies. I therefore like to see myself not only as a business woman, but as a pragmatist who knows that we can spend only what we have. That is what the coalition Government were facing.
I hope that I have set the debate in context. The regional growth fund was set up to create a fairer and more balanced economy, in which we are not so dependent on a narrow range of economic sectors and in which new business and economic opportunities are evenly shared across the regions and across industries. That is what we set out to achieve.
Angela Smith
The regional development agency Yorkshire Forward played an instrumental role in developing the UK’s first technology and innovation centre. We did not call it that. It is the advanced manufacturing research centre in Sheffield. That is now being lauded as the perfect example of where this country needs to go on investment in new technologies and design. Will the hon. Lady at least acknowledge that the RDAs had a very good and effective role in pulling together strategic investments and strategic design and innovation?
Esther McVey
I thank the hon. Lady for that intervention. As I said, I did not deal with Yorkshire Forward; I worked with the Northwest Development Agency and I congratulate the staff, who were excellent. I am saying that, despite spending £3.7 billion, what was meant to be done—rebalancing the economy—never happened. We are therefore asking how we can best deliver the money, how we can focus it and how we can ensure that it achieves its purpose.
Fiona Bruce
I, too, worked with the regional development agency in the north-west. What is particularly striking about the regional growth fund is that applications are succeeding from areas that, under the previous Government, were largely ignored when it came to business support. For years, business people in my constituency of Congleton have commented on the fact that although neighbouring areas—Staffordshire, for example—could obtain support, Cheshire was almost a desert. Now, we are seeing a difference. The Government are saying that there are areas across the country that need business support; and wherever they are, they are receiving it.
Esther McVey
I thank my hon. Friend for that intervention.
The purpose of the regional growth fund was to stimulate growth, secure jobs and increase the number of jobs. There was a consultation with the public: what did they think it would be best for the regional growth fund to do? The replies came back that they wanted flexibility and no duplication of funds. It was thought best that at least for stage 1—things will change over the next couple of years—there should be minimum bid thresholds of £1 million. It was also felt that guidance should be published. The first round allocated £2.7 billion, creating and safeguarding jobs. It created 27,000 jobs and a further 100,000 jobs in associated supply chains.
I want to talk specifically about Merseyside. In round 1, Pilkington’s in St Helens, Ames Goldsmith UK, Echo and Stobart were successful. I got in touch with Richard Butcher, Stobart Group deputy chief executive, to ask him about the regional growth fund. He says that the regional growth fund has been
“an important factor in Stobart Group’s commitment to the Halton region and will ensure the continued investment from us that the area needs to maintain economic regeneration and growth. The investment from Stobart, Prologis and Halton Borough Council has transformed the area and created many important new jobs—the support from the Regional Growth Fund will further enhance that regeneration.”
Stobart Group has already invested £100 million to date in the development of its Mersey multi-modal gateway logistics site in Widnes, but this new private-public partnership saw the regional growth fund as an ideal opportunity to push on with the development of a further 100 acres, eventually creating more than 5,000 additional jobs and £170 million in gross value added. With the £9 million received in round 1, it is moving forward on opening up 1 million square feet of warehousing space served by rail and road.
That is a perfect example of how the RGF can bring public and private bodies together to stimulate investment and boost the economy. Stobart illustrates the private partnership success and collaboration that has emerged from the RGF. It successfully forged a business partnership between itself, a road haulage operator, infrastructure developers Prologis and Halton borough council. As we know, the sum is always bigger than its parts. That example proves the case most effectively.
I want to refer to other significant developments. The regional growth fund was set up to make key links between private-private partnerships and private-public partnerships, and we are seeing that, but this is the start of a brand-new way of thinking. It is a way of focusing money that we have not seen before, and we will learn as we go along, so instead of the negativity that we have heard today—
Esther McVey
No, not just yet; I will in a second. When we talk in Westminster Hall about the confidence that business needs—we all know that that cannot really be defined but is necessary—it helps for all parties to give confidence to business.
Mr Edward Timpson (Crewe and Nantwich) (Con)
My hon. Friend has touched on the importance of business confidence. I am sure that as a fellow north-west MP, she will be pleased to hear that Bentley Motors in my constituency, which has already invested £1 billion in its Crewe plant, has secured money not only in the first round but in the second round of the regional growth fund—a further £3 million to boost its research and development. The company has said that that will not only secure the current jobs, but create more jobs in the local area. For the south Cheshire area and Crewe in particular, that is vital to ensuring that business confidence remains and that businesses can continue to invest in future.
Esther McVey
That is indeed vital. When we talk in the House and our words are taken down in Hansard and when people look at it on the internet, people must not just hear doom and gloom, because in reality many positive things are happening and they are coming from private industry.
Esther McVey
I will give way first to the hon. Member for Birmingham, Northfield (Richard Burden).
Richard Burden
The hon. Lady has said that she hopes that the Government will learn as they go along about how to deliver the RGF more effectively. Why does she believe that there have been delays? I am sure that businesses in her area are complaining about that quite a lot. There have been many delays in delivering money already promised. Why does she think that is?
Esther McVey
Let me correct that. I do not think that the RGF will be delivered more effectively, but that it will change along the way, as small and medium-sized enterprises link together and put in bids for £1 million. Everybody knows—I was slightly startled by some Members’ comments about this—that due diligence must be done and that money must be targeted at the right people. That is what people in business do—full stop. These things take some time.
Esther McVey
I will carry on, because I have nearly finished.
Thirty-four companies and other organisations across the north-west made successful bids in round 2. My hon. Friend the Member for Crewe and Nantwich (Mr Timpson) mentioned Bentley, but there is also the university of Liverpool, Pirelli Tyres Ltd, Northwest Aerospace Alliance, Sefton council and Liverpool Vision—the list goes on and on. There are 34 companies and other organisations in total, and they have benefited from some of this £3.3 billion, which is safeguarding jobs, as well as creating 37,000 new jobs, with a further 164,000 jobs in related supply chains and local economies.
Specifically on Merseyside, there is GETRAG FORD Transmissions in Knowsley, which has won support to expand capacity for the production of transmissions at the Halewood plant. Another development I would raise with the Minister is groups of SMEs bidding for £1 million. Last week, I brought a group from the Wirral Invest Network to Westminster to speak to him about how that could best be done. So, yes, the regional growth fund has done a tremendous job so far, against all the odds, but I would like it to be stepped up to help SMEs.
Simon Danczuk (Rochdale) (Lab)
The points I wish to make relate very much to the process surrounding how the regional growth fund works. The hon. Member for Wirral West (Esther McVey) talked about the need to spend money better, but the regional growth fund is spending it badly. All the evidence suggests that improvements can be made, particularly to the process. It cannot be right that only five or six firms out of 45 successful bidders have received money from the first round.
At last week’s Business, Innovation and Skills questions, the Secretary of State said that such an outcome was acceptable and that it was all part of the process, but the truth is that it is not acceptable. The lifeblood of any business is cash flow, and slowness in making awards will jeopardise the economic growth that the fund is trying to achieve. There are therefore real concerns about how the process is working and about its slowness. At the rate we are going, not all the awards will have been made to the businesses concerned by the end of this Parliament.
It cannot be right that the Department has issued nearly 30 press releases about the regional growth fund but has managed to allocate only five or six awards since the fund was set up. It also cannot be right that successful businesses have to hire consultancy firms to carry out the due diligence that is expected, as my hon. Friend the Member for Sedgefield (Phil Wilson) said. Under the previous structure of regional development agencies, that due diligence would already have been done, which would have resulted in a much quicker process.
There are questions about transparency. We are unsure how decisions are made about successful and unsuccessful bids. It has been pointed out to me that LEPs, which were the creation of this Government, are not being fully involved in the decision-making process. For example, the LEP covering Sheffield was not aware that Sheffield Forgemasters was to receive the funding that it did. As has been said, there are also reports in today’s newspapers that one of the business men who sits on the fund’s advisory panel owns shares in one of the businesses that will benefit from the second round.
My final point relates to the £1.4 billion being made available over three years, which is just a third of what the previous Government put into regional development.
Oliver Colvile (Plymouth, Sutton and Devonport) (Con)
I hear what the hon. Gentleman says, and there are two issues. First, we have had a great deal of discussion about how money should be going into business in the north-east and the north-west, but the south-west is also important. Secondly, the country is incredibly short of money, and we should surely be using this money for catalyst work and to build our skills base.
Simon Danczuk
I would not disagree, but my point is that the regional growth fund is not working effectively, although it might look attractive. We may have a limited amount of money, but it needs to be spent well, wisely and effectively. The measure of the regional growth fund, particularly given the amount being made available, was whether it would create private sector jobs to replace the jobs lost in the public sector. All the indications are that that is not occurring; indeed, we know that for a fact because unemployment—particularly youth unemployment—is going up. As a mechanism and policy, therefore, the regional growth fund is failing.
Simon Danczuk
I am going to conclude.
In conclusion, awards are being made too slowly, there is too much bureaucracy, there is a lack of transparency and the amount available is inadequate.
Eric Ollerenshaw (Lancaster and Fleetwood) (Con)
It is nice to follow the hon. Member for Rochdale (Simon Danczuk). The regional growth fund must have got something right if there are majority of northern MPs here because the majority of the money has gone to the north, and that, in a sense, is where I want to start. First, however, I congratulate the hon. Member for Sheffield Stockbridge and Penistone (Angela Smith) on getting this debate and on the fight she has put up for her area.
I want to talk about the background of the north-south divide, which Opposition Members seem to forget. The division between the north and the south has been recognised by the Government and by Government Members from the north, but it is not clear whether the previous Government recognised it. In December 1999, former Prime Minister Tony Blair said the north-south divide was as myth and
“an over-simplistic explanation of the problems that regional economies face”.
One wonders where the problems did begin. To be fair, he told The Journal in Newcastle four months later that
“the North South divide exists, and I never said it doesn’t.”
Labour then set up regional development agencies in every region. Even at the time, some Labour Members criticised the fact that London had a regional development agency. At this point, I should declare an interest, having been a member of that RDA. I should tell the hon. Member for Stockbridge and Penistone that I never saw a great deal of transparency in the way that agency dealt with things, but perhaps that was because I was its minority Tory member.
I thought the point of RDAs was to deal with the north-south divide. However, my hon. Friend the Member for Wirral West (Esther McVey) has spoken about the relative decline of the north over the past 13 years. I want to give some figures to illustrate that. The latest figures I have for gross value added in the north—for what the north added to the national wealth—show that between 1995 and 2008, which is before the coalition Government took office, and with 100 being the average, the north-east saw a decline from 82.9 to 78.2, the north-west saw a decline from 90.2 to 86.4 and Yorkshire and the Humber saw a decline from 89 to 82.9.
If we go beneath that to the sub-region and look at my area, we see that Lancashire had a GVA of 88.7 in 1995, but that went down to 78.7 in the figures for 2008. That is a 10 point drop. What was the RDA doing if that was happening?
Tom Blenkinsop
What are the actual or nominal figures? What is this 82% of?
Eric Ollerenshaw
I am talking about a national average of 100 from 1995 to 2008. The hon. Gentleman’s area declined even further.
David Mowat
The point my hon. Friend is making extremely powerfully is that, in the last year of the previous Government, the north-south divide reached a peak for the previous three decades. That is extraordinary; it was brought about by the boom in the south-east and London, and it is a fact.
Eric Ollerenshaw
Let me move on.
I congratulate the Government on being among those who recognised that something needs to be done. Yes, the regional growth fund is not the biggest thing, and we want more to be done.
Eric Ollerenshaw
May I just continue a little further before I give way?
At the moment, however, we are learning as we are doing. I was here in May when some Members complained about the first round of bids. I suggested that it was following the old methods of the RDA in the north-west, and my hon. Friend the Member for Congleton (Fiona Bruce) has mentioned that, too. The areas prescribed were Greater Manchester and Merseyside—for obvious reasons, given European rules and all the rest of it; but there was a lack of actual support for good businesses in other areas, such as my own, which had the capacity to expand and take on more people. For example, Northern Tissue Group, with 150 employees—so it was not applying for the biggest grant—was denied a grant in the first round. I am pleased that in the second round it is still in discussions, and it looks as if it may well succeed.
Eric Ollerenshaw
I shall give way first to the hon. Lady, and then to the hon. Member for Middlesbrough South and East Cleveland (Tom Blenkinsop).
Angela Smith
My constituency is Penistone and Stocksbridge, with an “s” in it. It is being misquoted all over the place.
Angela Smith
Is the hon. Gentleman really saying that the Government can do more for less—for two thirds less? Is he really saying that they can deliver more growth and rebalancing of the economy on a fund that is only one third of the original sum on the table?
Eric Ollerenshaw
There are a couple of things to say. My hon. Friend the Member for Wirral West has explained the economic circumstances, and I do not need to go through that again. However, as my hon. Friend the Member for Nuneaton (Mr Jones) keeps pointing out, the bureaucratic cost of the regional development agencies was something like £300 million, before any money got to any business through any due diligence process. We got rid of that, and what I regard as the success in round 2 is the fact that the companies in question are way beyond the normal areas, in Burnley, Wigan and as far as Carlisle and Cumbria—and I hope that my own part of Lancaster is part of that. That is a recognition of where success lies, and what we have learned from the mistakes of the regional development agencies.
[ Mrs Linda Riordan in the Chair]
Tom Blenkinsop
The hon. Gentleman is very generous with his time, and although we disagree, he is obviously fighting hard for his local patch. The only point I will make is about the regional growth fund and its significance in the north-south divide. I will go back to the nominal figures for how much was put into the north-east, for example. More, nominally, was going into the north-east. If the regional growth fund is such a great regional pot of cash, why is it less than the money that the Government are spending on mutualising the Post Office?
Eric Ollerenshaw
Yet again, because of the circumstance that we were left with by the previous Government. It seems we must go on repeating those figures. I think everyone understands—and that the hon. Gentleman knows it. I was not going to go into this—other hon. Members have mentioned it—but it is not just the regional growth fund that is relevant. There is also the national insurance contribution holiday for new start-ups, and the Localism Bill. Many Government Members believe that the Bill will equip local authorities to do a great deal more for themselves, and get through the sub-regional bureaucracy, which we have abolished, and do something for their areas. They are far more in the picture as to what is successful.
James Wharton
Opposition Members seem to think that the only money is Government money. Is not it the case that, because of careful targeting, funding through the regional growth fund is leveraging almost six times its own value in private investment, which is delivering the growth and investment that we need in our regional economies?
Eric Ollerenshaw
My hon. Friend makes the point about what we hope to get from the measures far better than me. All that I wanted to say to Opposition Members was what we have learned from the regional development agencies’ mistakes, their excessive bureaucracy and, in their last years, their failure to deal straightforwardly with business as business deals with things. Instead—
Eric Ollerenshaw
I am sorry; I must finish. I have only got a couple of minutes. Perhaps the hon. Gentlemen can intervene on other hon. Members.
Opposition Members talked about instructions from Whitehall, but I think, as a member of an RDA board, we got new instructions every month from Whitehall about where the money should go and on what it should be spent. There was no real discussion with straightforward business about what it wanted to do. I hope that what is happening now is the beginning of that approach.
I want to finish with certain questions to Ministers, as other hon. Members have done. We see what we are doing as a beginning. There is a huge north-south divide, and the Government seem to be learning while they are doing; but we have questions about where we go from here with growth funds, and in continuing to deal with the north-south divide, which has got worse in the past 13 years.
Mrs Linda Riordan (in the Chair)
I will call the hon. Member for Plymouth, Sutton and Devonport (Oliver Colvile) next, but perhaps he will keep his comments short, because I intend to call the shadow Minister at 12.10.
Oliver Colvile (Plymouth, Sutton and Devonport) (Con)
Thank you for calling me, Mrs Riordan. I will be as brief and as quick as I can. I congratulate the hon. Member for Penistone and Stocksbridge (Angela Smith) on securing the debate, which has been interesting, not to say feisty.
I thank my hon. Friend the Minister for giving some grant to Princess Yachts, which does not appear on the list. It is a very big, important manufacturer of luxury boats in my constituency. To give some context, Plymouth is the largest conurbation west of Bristol, and 38% of people in work there are employed in the public sector. There is a desperate need to rebalance the economy. I am delighted that the application was made with cross-party support. My hon. Friend the Member for South West Devon (Mr Streeter), the hon. Member for Plymouth, Moor View (Alison Seabeck) and I were very supportive of the application, and we are delighted that it came forward. It is the second of the Plymouth applications to have been granted; the Western Morning News and Plymouth university gained some funding in the first round.
Plymouth has a fine reputation. It is a global centre for marine science and engineering, and the decision made by my hon. Friend the Minister to put moneys into a significant cluster of economic activity will pay significant dividends much further down the line. We need—most certainly in Plymouth, which is a low-skill and low-wage economy—to develop the business of understanding, so that we can compete with countries such as China and India.
The help to Princess Yachts has been a real fillip. There was a threat of the company—which is no longer British-owned, but owned by people in France—relocating. The owners were considering sites in eastern Europe, and had identified a place. We can now try to ensure something like 300 new jobs that might otherwise have gone abroad.
This has been a very useful debate, and I am grateful to the Minister for listening to the issues. However, I would argue that the south-west, which is never the sexiest of places economically, needs help. I encourage my hon. Friend to visit us, and see for himself some of the excellent work in the burgeoning private sector.
Mr Gordon Marsden (Blackpool South) (Lab)
It is a pleasure to serve under your chairmanship, Mrs Riordan, as it was to serve under that of Mr Gray. I warmly congratulate my hon. Friend the Member for Penistone and Stocksbridge (Angela Smith), not just on her timing, but on the excellence of the arguments that she put forward. Indeed, I welcome all the interventions and comments made by Labour Members, because we have been trying to address the issue in the round.
It is always important for hon. Members to speak up for their constituencies, as the hon. Member for Plymouth, Sutton and Devonport (Oliver Colvile) and others on both sides of the Chamber have done. However, the debate is about the overall effectiveness of the regional growth fund, and it is on its overall effectiveness, compared with previous funding streams, that it should be judged. It is relevant in that context to say a little about the comparison between the regional development agencies and the regional growth fund.
I am sorry that the Government do not like the repetition, but I repeat that it is a fact that the regional growth fund will have only a third of the money that the RDAs would have had over the same period. It is not surprising, therefore, that both rounds were massively over-subscribed. More than £6 billion-worth of bids were submitted for the two rounds, with only £1.4 billion up for grabs. As my hon. Friend the Member for Penistone and Stocksbridge pointed out, in the second round, three out of every four bids put forward were—I will be charitable—not able to receive funding under the RGF. The Government have now rather slyly confirmed that there will not be a third round. The Minister might want to comment further on that, because it was certainly indicated previously that there would be. We must realise that the bids that have not succeeded face 18 months without the prospect of support from the regional growth fund, in what is probably the grimmest economic climate for many years.
Having said that, I should be charitable to the Government. It is perhaps not surprising that the regional growth fund has been so slow to get off the ground, and that the funding has been so slow to be allocated. Ministers from a number of Departments have spent months suggesting that the regional growth fund could be the cure for all ills. They are on record in Hansard as suggesting that the fund could pay for housing pathfinder projects, the York railway museum, and even the “silicon city” proposal in east London. Those plans were all lauded by Ministers as worthy bidders for the fund. Ministers have obviously been taking inspiration from the parable of the loaves and the fish in the Bible, but I have not seen either the Minister or the Secretary of State walk on water recently.
On 12 April, the Government announced the 45 winning bids, but well over six months later, nearly 90% of first-round bidders still had not received their cash from the Government. Doubtless that was why, on “The Daily Politics” show a couple of weeks ago, Andrew Neil rather unkindly, in his crisp fashion, asked the Secretary of State for Environment, Food and Rural Affairs a question to which she did not have a good answer. He said that:
“your coalition government, citing bureaucratic snags, has conceded that the £1.4 billion Regional Growth Fund has so far disbursed £5.8 million, why is government so useless?”
James Wharton
Earlier in this informative debate, the right hon. Member for Sheffield, Brightside and Hillsborough (Mr Blunkett) said that two and a half years of due diligence were conducted on the Sheffield Forgemasters loan, yet no money was given at that point. It is important that due diligence is conducted when Government money is given out. Regional growth fund money is often tied up with private investment, which can come first to allow projects to go ahead. Does the hon. Member for Blackpool South (Mr Marsden) acknowledge that?
Mr Marsden
It is important that there is due diligence. I will come on to explain why that is, and why the Government do not seem to have done it well.
As I was saying, nearly 90% of first-round bidders had not received their money. It is not only the Opposition saying that. In yesterday’s “Today” programme, the chief executive of the North East chamber of commerce, James Ramsbotham, was asked whether the money will help. Referring to the second round, he said:
“It’s…difficult to say, because of…the first tranche of the RGF…not a penny has been paid”.
I assume that he was referring to the north-east. He also said that
“the businesses that it’s going to are…already doing incredibly well…I do believe that it’s worth investing in success…although there is clearly a lot of debate about whether there should be more investment in jobs and in infrastructure”.
He said that the delay was serious and needed to be addressed. When asked about whether the Government should have scrapped the regional development agencies, he said that One North East had worked rather well to promote the area for tourism and business, that nobody would be doing that now, and that it would be a loss.
That brings us on to a broader point about the way in which the Government got rid of the RDAs and the impact on the regional growth fund. One of our criticisms is that the process of filtering the bids has had little regional input. The RDAs had good expert advisers, who could have been used either directly in the regional growth fund bids or in local enterprise partnerships. However, because the process has been driven by two of the horses of the apocalypse, in the shape of the Chancellor of the Exchequer and the Secretary of State for Communities and Local Government, who wanted the mention of anything regional blotted out, those people have been lost. That is a great loss.
The Government have tried to hide behind excuses for the delays. Lord Heseltine stated last month that RGF money was never expected to come first, and that businesses would proceed with other sources of cash first. Yet the guidance on the RGF’s bidding criteria, as Opposition Members have already said, states that bidders would usually expect to receive the cash in line with other payments.
In the article in The Times that has already been referred to, the Minister made precisely that point. He talked about the problems that there had been with certain bidders not being able to draw down private sector funds, which was holding up the Government’s release of cash. The Government cannot have it both ways—they cannot on the one hand say that it is perfectly all right for the money to come at the end of the process, and on the other concede to The Times that the fact that the money has not been forthcoming is a serious part of the problem. That is part and parcel of the blurred and confusing way in which the Government have proceeded.
The Minister said in the article that due diligence should take about six weeks on average, but clearly that has not been the case; 40 bidders were still waiting six months later. Sometimes the Department for Business, Innovation and Skills seems to resemble the Spanish empire of Philip II, where the bureaucracy was so labyrinthine and took so long that a famous quote said, “If death came from Madrid, I would be immortal”. We all know what happened to the Spanish armada, and I hope that its fate will not befall the Minister, the Department or its officials. There is a serious point about how the Government have handled the process. I would like to hear from the Minister what will happen to the money that he says may not be distributed under due diligence.
It is also important to ask what input there is into the process within BIS. How many people are working on it? The Minister needs to answer the questions raised by the Opposition about external factors and costs, but I know from his answer to a question of mine on 8 September that only 11 full-time officials in the Department were working on the regional growth fund at that time. I leave Members to consider whether that is reasonable. Given that it has taken the Department a long time to deal with only five bids from round 1, how long do Members think it will take to deal with 119?
Although the scheme is called a regional growth fund, there appears to have been little or no regional input in the process, with decisions taken in Whitehall. Taking the panel as an example, we know who is on it, but 15 months after the process was launched, we still do not know clearly what the panel does and how it does it. It would be helpful if the Minister could explain precisely the link between the panel’s advice and the decisions made. That is extremely important, particularly in light of two articles in The Times and the Financial Times today. The FT article dealt with an issue that the Opposition have already raised—the interests of one of the members on the panel. The article in The Times drew some conclusions on how there seemed to be a relationship between the distribution of bids, political areas in the country, and companies that are significant backers of the Conservative party. That is for The Times to say; it is not for me to comment on. I prefer to take up what is said at the end of the article. The Minister has to listen to this. The article states that the process is getting a lukewarm welcome from the CBI and from the director general of the British Chambers of Commerce, who said:
“The speed at which this funding is delivered will be fundamental to the success of the Regional Growth Fund.”
The Government must move faster. The deputy director general of the CBI said:
“Despite its size, this fund does not have the capacity to plug the finance gap. The Government needs to look at other funding options to help these firms grow.”
Those are exactly the points that the Opposition have made throughout the process. We believe in the principle that money that is meant for the regions should stay in the regions.
There are three key criteria regarding regional growth policy on which the Government should be judged: the conduct of the RGF and how adequate it is as a replacement for RDA funding; how adequate LEPs are to take over the RDA structures—I have already referred to the failings in the system—and mechanisms for releasing European funding to the regions. The Minister needs to address all those issues, particularly the role of investment in transport infrastructure.
The Minister and the Secretary of State preside over a fund into which they do not put any money—the money comes from the Department for Communities and Local Government, the Department for Environment, Food and Rural Affairs and the Department for Transport. That showed in the first few months, when, as I said, those Departments steamrollered the Department for Business, Innovation and Skills and pushed it out of the way. It is now trying to claw back the role, but too much time has been lost in that process, and too much time is still being lost because of the incompetence of the process of due diligence.
The Minister of State, Department for Business, Innovation and Skills (Mr Mark Prisk)
I congratulate the hon. Member for Penistone and Stocksbridge (Angela Smith) on securing this debate. She will not be surprised to hear that I accept neither her analysis nor her arguments. One of the points that has come from the many excellent contributions, to which I will respond if I can in my reply, is the issue of confidence. The official Opposition will want to raise issues because good scrutiny is part of Parliament, but they should remember that confidence is important for business. Labour needs to be careful not to talk down the economy. I absolutely agree with balanced scrutiny, but point-scoring does not help our constituents, and we should bear that in mind.
The Government believe that if we are to have a sustained recovery, we need a resilient economy—an economy that is balanced between public and private, and between industries. My hon. Friend the Member for Nuneaton (Mr Jones) made a good point when he mentioned the significant drop in employment in manufacturing during the 13 years of Labour Government.
We are also well aware that we need an economy that is balanced across the whole country, which is why we have set out a comprehensive approach to local growth to replace the old RDA system. My hon. Friend the Member for Lancaster and Fleetwood (Eric Ollerenshaw) was absolutely spot on: whatever individual cases may be made about specific projects, the sad reality is that after £16 billion and 10 years of an RDA system that was expressly established to close the gap between north and south, the gap got bigger. A responsible Government cannot ignore that simple fact.
Our strategy incorporates a range of elements, including the regional growth fund. It includes the local enterprise partnerships. The 38 in place cover 99% of the English economy. Local business and civic leaders set what they believe are the right priorities for their local area. We also have 24 enterprise zones, which will accelerate growth in key areas. In Yorkshire and Humber, the area of which the hon. Member for Penistone and Stocksbridge is a part, we see three specific enterprise zones—one in the Sheffield city region, one in the Leeds city region and one in the Hull and Humber area. With those programmes, we have ensured that where we are able to, given the difficult circumstances that we have inherited, we have put money into key infrastructure. For example, we have pressed on with the controversial high-speed rail investment, which is very important for the midlands and Birmingham and the whole north-east.
Mr Prisk
If the hon. Gentleman will allow me to get on to the regional growth fund, I will let him come in at that stage.
The regional growth fund complements our other growth policies. Worth up to £1.4 billion of public money, it has two crucial objectives: to unlock the private sector investment to enable key projects to proceed, and to support areas that are especially dependent on the public sector, to enable them to have more balanced and resilient economies in the future.
We have had two popular bidding rounds, and the results of the second were announced yesterday. I am sorry that the Labour party is upset that not everyone won. Well, that is life. The reality is that it is a competitive fund, and it seems peculiar that Labour does not understand that rather obvious principle.
Let us look at round 1, which was the subject of Labour’s criticisms. We invited bids up to 21 January this year. We received 464 bids, the total value of which would have been something like £2.78 billion. In April, we were able to confirm the 50 conditional allocations, totalling in the region of £450 million of public money. Importantly, that £450 million of taxpayers’ money was offered up in the knowledge that having looked at those schemes, we could lever in investment from the private sector of £2.5 billion—a balance of five to one. I am pleased to confirm to the Chamber that more than half of the successful projects that we identified in April are already under way. When complete, the schemes in round 1 are expected to create or safeguard 27,000 direct jobs, or a further 100,000 indirect jobs. There are very good quotes from General Motors about how it that is already under way with the Vivaro van project in Luton. We have also heard about Bridon in Tyneside and Bentley in the north-west. My hon. Friend the Member for Wirral West (Esther McVey) mentioned Stobart, and up in Teesside, the restart project is under way.
What worries me about this debate—Opposition Members seem or choose not to understand this—is that the whole point about the programme is that the regional growth fund is designed to unlock private sector investment and lever it into schemes, and as anyone who has been in business knows, that means that payments made by Government will often come in the latter stages of development.
Tom Blenkinsop
Labour Members fully understand that public-led investment attracts private-led investment. Will the Minister confirm how many RGF projects have European regional development fund match funding, and whether the Treasury is retaining those ERDF funds from the regions?
Mr Prisk
There is a very small proportion of funds related to ERDF in round 1, and even fewer in round 2. My point, which the Opposition do not want to accept, is that when the public sector seeks to invest money, it is doing so to unlock the private sector investment. If we do not get that private sector investment, there will be a problem. The Opposition seem to believe that everything that we do should be measured solely and entirely by how much Government spend. Have they not learned from 13 years that it is how we spend the money that is important?
Angela Smith
There is the other issue of the assets that belonged to the RDAs, which could be used to help unlock private sector investment. What will the Government do with those assets? Are we going to have a fire sale, or will we use those assets to invest in infrastructure and private sector growth?
Mr Prisk
It is self-evidently the latter, which is why we established the local stewardship model. It is why in July we offered Members of this House the opportunity to meet Ministers, and why we are repeating that exercise on Thursday. We are determined to ensure that the assets are used for the benefit of the local economy. I hope that the hon. Lady will come to that meeting so that she can understand that.
Richard Burden
The Minister has talked about confidence and about unlocking and levering in investment from the private sector. Does he not accept that the performance of the RGF is important in maintaining confidence? Let me give him an example. As far as Longbridge is concerned, it is difficult to get the confidence from the private sector to unlock investment when the Government are not clear about what is going on. We can only point for so long to the investment that the previous Labour Government made by way of a new college and a new innovation centre. The private sector wants to know whether this Government back the Longbridge project as well. It really needs answers pretty soon.
Mr Prisk
After the dithering by the Labour party over Longbridge and that site, the hon. Gentleman should be a little careful about what he says. We made the situation crystal clear to the owners, the local enterprise partnership and the city council. Those discussions are in hand, and I am confident that they will be concluded successfully.
Jason McCartney
I thank the Minister for coming to the royal armouries in Leeds just a few weeks ago to speak to the Leeds city region LEP. Some 600 energetic, enthusiastic and positive business leaders are really moving forward with this. I take on board his point about business confidence. Camira Fabrics, Thornton & Ross Pharmaceuticals, Newsholme Food Group and Equi-Trek horse boxes in my patch are all going out there and making it happen. Does the Minister not agree that the regional growth fund is just part of the package for growth? We also have the enterprise zones, the LEPs and 450,000 apprenticeships; that is up 50%. Yesterday, a young entrepreneur got in contact with me about the enterprise allowance. The regional growth fund is just part of our package, while the Opposition only have an unfunded cut in VAT.
Mr Prisk
I am grateful to the hon. Gentleman for that flattering remark. May I return to the issue of due diligence? The Opposition tell us that the situation is disgraceful and has been going on for months and months. The reality is that the average time for due diligence is three to six weeks. That contrasts sharply with the performance of the Labour party when in government. It established the automotive assistance programme. It took 15 months for that to deliver a single penny. Why will the Opposition not accept their own failings?
Take the trade credit insurance scheme, which was launched as a £5 billion package. Thousands of people were supposed to benefit from it. In the end, one company benefited, at a cost of £81,500. When the Opposition talk about due diligence, they need to be a little careful about how they make their arguments. In particular, they should be careful about the reference to allegations in newspapers concerning individuals. The hon. Member for Rochdale (Simon Danczuk) referred to allegations about one of the panel members, Mr Moulton. Let me make it clear that Mr Moulton took no part in decisions on any areas in which he had an interest, and that includes in the decision on Redx.
Let me turn to the second round. That round has improved in leverage on the first round. It is not £5 of private money to £1, but £6 to £1. When we look at the scheme as a whole, we will see that a third of a million jobs are being safeguarded, and £8.5 billion is being levered in from the private sector to help many of the jobs and businesses to which many hon. Members have referred. I hope that the Labour party can look, just for once, at the facts rather than engaging in cheap point-scoring. This is an important debate. We all want jobs to be created; I hope that Labour will share in that debate.
Alcohol (Under-18s)
(12 years, 6 months ago)
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Stephen Gilbert (St Austell and Newquay) (LD)
Thank you very much, Mrs Riordan, for calling me to speak. It is a pleasure to serve under your chairmanship for the first time in a Westminster Hall debate. I suspect that it is not what I am about to say that is causing colleagues to leave Westminster Hall so quickly.
At the outset, I declare an interest, in that the father of the Under-Secretary of State for the Home Department, the hon. Member for Old Bexley and Sidcup (James Brokenshire), who is the Minister responding to the debate, is a constituent of mine. I hope that that fact might sway the Minister when he makes his remarks.
This debate has been prompted by continuing concerns in Newquay, which is in my constituency, about under-age drinking, including its health impacts, its role in causing antisocial behaviour and the part that parents can play in providing children with alcohol for consumption in an unsupervised setting.
The Chamber will be aware that, like many other seaside towns and many of our city centres, Newquay has had its share of problems associated with binge drinking. The Chamber may be interested to know that 5,000 unaccompanied 16 and 17-year-olds arrive in Newquay every year during a four-week period, mostly to celebrate the end of their GCSEs. Sadly, this annual pilgrimage—some might call it a rite of passage—has become associated with drink-related antisocial behaviour.
The tragic deaths of 16-year-old Paddy Higgins and 18-year-old Andrew Curwell in 2009 served as a wake-up call to the local community in Newquay that action needed to be taken to protect children and young people when they visit Newquay to prevent similar accidents occurring in the future. Newquay has risen to that challenge. The formation of the Newquay Safe Partnership has seen organisations and individuals including Devon and Cornwall police, Cornwall county council, residents, local businesses and organisations representing pubs and clubs, the off-licence trade and providers of accommodation working together to tackle alcohol misuse and irresponsible behaviour.
Fiona Bruce (Congleton) (Con)
Does the hon. Gentleman agree that, as has been stated in a recent report by the think-tank Demos, parental involvement is vital? That report shows that, if income, education, ethnicity and gender are discounted, styles of parenting are very influential, and it also showed that a combination of discipline, affection and parental involvement ensure that 16-year-olds are less likely to engage in dangerous drinking.
Stephen Gilbert
The hon. Lady has pre-empted a point that I was going to make later, namely that in many cases parents underestimate their influence on their children. She is right to quote the Demos research.
Public services in Newquay have risen to the challenge of dealing with under-age drinking. We have seen the introduction of Challenge 25, with staff being given training to spot fake identity cards; there is a confidential phone number to report proxy buying, which is the buying of alcohol by adults for children; and a code of conduct has been introduced for bar crawls. The police have introduced a “follow you home” scheme, which sees the local Newquay force inform parents and local authorities in an individual’s home town about instances of antisocial behaviour that take place on holiday. There are also new minimum safety standards for local providers of accommodation, and there is concerted police action to seize alcohol in the streets and on public transport. Coast Safe, an alcohol awareness and seaside safety lesson package for teenagers, was launched yesterday. It was put together with the help of Newquay schoolchildren, and it is sponsored by St Austell Brewery. It aims to provide a resource for schools across the country to reduce loss of life and serious injury among young people by encouraging sensible drinking and responsible enjoyment in seaside towns.
The cost of crime in Newquay in 2008-09 was more than £9 million. The success of the Newquay Safe Partnership is that it has reduced that cost by more than £250,000. Nuisance behaviour is down by 22%; violence is down by 7%; and drug offences are down by 14%. I commend all the people who are involved in the Newquay Safe Partnership scheme.
Although most parents want to introduce their children to alcohol in a responsible and measured way, one contributory factor to the binge drinking and antisocial behaviour that we see in Newquay, and indeed in other seaside towns, and it is a factor that the police remain concerned about, is the way in which some parents send their children to Newquay with huge amounts of alcohol. I will give some examples of this parental behaviour supplied by Devon and Cornwall police, which put the issue into context and which may benefit the Chamber.
One Newquay guest house has reported that parents regularly turn up with their children and a car boot full of booze. When told by the management that that is unacceptable, parents seek to meet their children elsewhere in the town to pass the alcohol to them. In one case, 67 cans of Special Brew were seized from four children who were visiting Newquay for a weekend. Another guest house reported finding 350 items of alcohol in one room that had been let out to just six children who were visiting Newquay. A local caravan site seized more than 353 cans and bottles containing alcohol from 16-year-olds during a 10-day period, including 117 cans of Stella and 5 litres of vodka. On one day in July this year, police confiscated 443 cans and bottles containing alcohol from children arriving in Newquay on public transport. One 16-year-old girl arrived in the town for a four-day break with £300 in her wallet, and later that same day she was found incapacitated by alcohol and her parents were asked to come to Newquay to collect her. A youth mentoring scheme reports that 70% of young people have been given alcohol by their parents.
As I have said, the vast majority of parents want to introduce their children to alcohol in a responsible and supervised way, but it seems that some parents are not considering the impact of leaving their children unsupervised in an unfamiliar town with large amounts of alcohol. When police and other local authorities or local people, such as the managers of hotels or guest houses, try to reproach parents about their behaviour, they are often met with hostility. Police were told by the parents of one 16-year-old boy, who had 64 cans of Special Brew seized from him, that they were “spoiling his fun”.
In Newquay, as in other seaside towns, local public authorities effectively adopt young people when they are in the town.
Sarah Newton (Truro and Falmouth) (Con)
I congratulate my hon. Friend, who is making a fantastically positive speech about what has been happening in Newquay to tackle these very difficult problems. In case that people think that under-age drinking is a particular problem for Newquay, I want to back up my hon. Friend by saying that it is a problem all over the country and certainly in other seaside towns around Cornwall. It is important that we see this as a national issue and not just a problem in Newquay. It is also important that we learn from the fantastic work in Newquay.
Stephen Gilbert
My hon. Friend is exactly right that this is not a problem that is unique to Newquay. It is a problem that Newquay perhaps now has expertise in tackling, but I hope that the lessons that we have learned, the successes of schemes such as the Newquay Safe Partnership and the way in which we are now moving forward to tackle the parental supply of alcohol can be instructive to all parts of the country.
Dr Sarah Wollaston (Totnes) (Con)
Should we not address not only the issue of parents sending children away to places such as Newquay with alcohol but the supply of alcohol that is routinely provided in children’s own homes? Indeed, should we consider making it an offence for parents knowingly to supply other people’s children with alcohol at parties on their own premises, which we would otherwise call proxy buying?
Stephen Gilbert
My hon. Friend has opened a can of worms by raising the responsibilities that parents have to not only their own children but other people’s children in their homes. Parents often underestimate their influence over their children, whether it involves setting an example or supplying alcohol for parties. She has made an excellent point, and I hope that the Minister will respond to it when he winds up the debate.
We know from research by the Joseph Rowntree Foundation, which published a paper on this issue in June, that if a young person finds alcohol easy to obtain their chances of drinking excessively increase fourfold. Equally, if a young person sees their parents drunk, it doubles the chance that they themselves will get drunk. In that report, parents emerge as one of the crucial influences on teenage drinking. Shockingly, that research, which was based on a survey of 5,700 children, found that one in five children claim to have been drunk for the first time by the age of 14 and that half of all 16-year-olds report having been drunk.
Last weekend, further research from the schools health education unit showed that children as young as 12 say that they drink the equivalent of 19 glasses of wine per week. In that survey, 83,000 school pupils were questioned, and 4% of 12 and 13-year-olds said that they consume 28 or more units of alcohol a week, which is more than the maximum amount suggested in the adult weekly guidelines for alcohol. Clearly, it might not be possible or appropriate to use legislation to solve this widespread cultural problem, but we must ensure that legislation passed by this House does not create an opportunity for the problem to get worse. I welcome the steps that the Government are taking to crack down on people who sell alcohol to children, including the doubling to £20,000 of the fine for under-age alcohol sales and the extension of the period of closure that can be given as an alternative to prosecution when premises are found to have been involved in supplying alcohol to children.
I want the Minister to touch on a number of issues that continue to cause me and the police concern. The first is section 149 of the Licensing Act 2003, which prohibits the proxy purchase of alcohol by adults for children. The section has been successfully used in Newquay in a campaign supported by Crimestoppers, with a number of individuals being prosecuted when there was evidence that alcohol has been bought by an adult and supplied to a child. There is a clear problem, however, with parent dealers, who when questioned by the police often say that they did not buy the alcohol for their children—they just happened to have it and handed to them. Any well-prepared brief could drive a coach and horses through the attempted prosecution of a parent under that legislation.
Another legal avenue at our disposal are child neglect provisions, but they would apply only to under-16s, leaving a hole where the slightly older, but still vulnerable, 17 and 18-year-olds are. Will the Minister, therefore, undertake to review section 149, and look at tightening up rules on parental supply, perhaps stipulating that parents must be on hand to supervise the drinking of any alcohol that they supply to their children?
A second legislative hole is in the Confiscation of Alcohol (Young Persons) Act 1997, which provides the police with the power to confiscate but to make an arrest only if the request to hand over the alcohol is not complied with. Because of the significant pressure on local police forces, it is often not possible for them to make an arrest even if such action is desirable, and their power in that regard must be strengthened.
I firmly believe that we must look again at alcohol pricing, and I have raised the issue in the House. Even with the changes recently announced by the Government, supermarkets’ ability to sell alcohol at prices that are so much cheaper than in pubs and clubs causes genuine concern to many people.
Nick Smith (Blaenau Gwent) (Lab)
I thank the hon. Gentleman for initiating this important debate. He has painted a powerful picture of the effect of alcohol misuse in his constituency. Does he agree that we must have a minimum price of at least 50p, as recommended by the British Medical Association, if we are to make a difference?
Stephen Gilbert
I am not expert enough to say where the price should be set, but I agree that the Government need to take a concerted look at minimum alcohol pricing, because what has been done to date does not go far enough. I firmly agree that minimum pricing is the only real way forward. The hon. Gentleman’s point is backed up by a 2008 report by the university of Sheffield, which showed that minimum pricing is the best way to reduce alcohol harm, and the report forms the basis of a handbook being produced by the World Health Organisation on its approach to dealing with alcohol-related harm.
The Minister will be aware, as early-day motion 2264 makes clear, that of the 4,000 price promotions under way in February, only one would have been affected by the current Government policy to prevent the sale of alcohol at a cost below duty plus VAT. Will the Minister undertake to meet me and representatives of Devon and Cornwall police to discuss minimum alcohol pricing and the further steps that the Government can take? Will he also look, with colleagues in the Department for Culture, Media and Sport, at the ubiquity of alcohol in supermarkets? If a licensing regime and hours are felt appropriate for clubs and pubs, should they not also apply to supermarkets and other outlets? The Minister will be aware that the Association of Chief Police Officers is considering a national policing alcohol harm reduction strategy, which covers the role of parental control and supply. Will he engage with officers who face this problem across the country, and take concrete steps to help the police to keep children safe?
The problem of alcohol abuse requires a deep-seated cultural change. A single debate here today will not achieve that, but I hope that it will help to promote discussion about parents’ role in supplying children with alcohol for unsupervised consumption. As well as ensuring that the police have the necessary powers to combat under-age drinking, we need a greater emphasis on education. The charity Drinkaware has recently launched a “Your kids and alcohol” campaign, which emphasises the importance of parents talking to their children from an early age about drink, ideally in their pre-teens before the influence of peers increases. Drinkaware’s advice to parents is clear, “You have more influence than you think.” Most parents assume that they are the last people their children would turn to to talk about alcohol, but research shows that children between the ages of nine and 17 would go to their parents first. Parents need to talk to their children, and keep talking, before their friends do. Giving children the facts earlier ensures that they get accurate information with which to challenge what their friends tell them and make responsible choices.
We all enjoy a drink, but we must recognise the dangers that unsupervised drinking can present to children and the need for parents to help educate and protect them. I look forward to the Minister’s reply.
The Parliamentary Under-Secretary of State for the Home Department (James Brokenshire)
It is a pleasure to serve under your chairmanship, Mrs Riordan.
I congratulate my hon. Friend the Member for St Austell and Newquay (Stephen Gilbert) on securing this debate, and on his approach in advancing the case about parents’ responsibility in respect of their children. I also congratulate him on representing such a wonderful constituency. Many of my family members hail from the area around St Austell, and I have very happy memories of spending lots of time there during my childhood and thereafter. He is a very lucky Member of Parliament to represent such a fantastic area, with so many wonderful people, sights and places to visit.
I always encourage people to flock to the wonderful coastal resorts in Cornwall, such as Newquay, for their sheer beauty and wonderful landscape. However, I would not want their enjoyment to be interrupted or hindered by the wanton and yobbish behaviour of people who are there just to get drunk and cause mayhem in communities that have so much to offer. That behaviour must be challenged and addressed. I pay tribute to the work of the agencies in Newquay for the steps that they have taken and continue to take to ensure that the town is a very special place, the benefits of which can be enjoyed by both young and old. For many years, I have enjoyed the wonderful north Cornish coast, and I hope to continue to do so with my children.
I have heard what my hon. Friend has said and have first-hand experience of the context. He knows that I visited Newquay the summer before last, as Minister with responsibility for alcohol policy, and that I was lucky enough to spend an evening with some of the partners and agencies involved in the Newquay Safe Partnership, including Superintendent Julie Whitmarsh. I also visited the Central Inn to get a sense of the challenges and problems that the town had been experiencing. I pay tribute to what the local police, the local authority, the Newquay Safe Partnership and others have achieved in the face of the challenges involved in tackling alcohol-fuelled crime and disorder. I was shocked and disturbed by the accounts of some the worst excesses of irresponsible drinking by young people, and I was outraged to hear about the actions of irresponsible parents in, essentially, assisting that behaviour.
I have looked back at the press commentary that followed my visit to Newquay in July 2010, when I said to the Western Morning News:
“I was just astounded by this virtual mountain of alcohol that had been taken after being supplied by parents. I think it is utterly irresponsible. As a parent you have the ultimate responsibility towards your child, and thinking that they are going to be safe when they are loaded up with booze is unbelievable.”
That was my view then, and it is my view today. I endorse my hon. Friend’s approach in underlining this important issue.
I realise that the issue is complex. My hon. Friend and others have made some thoughtful and interesting points in the debate. They have scoped out the relevant challenges in this sphere for agencies and the Government, and they have underlined the responsibility that all parents have to their children. I shall try to respond to as many concerns as I can in the time allotted.
Along with other towns, Newquay faces particular problems every year. Hon. Members were right to say that those problems should not be regarded as specific to Newquay, and it would be wrong to characterise the town in that way. Alcohol misuse affects many communities—we see it in our town centres, in rural and seaside towns and in other leisure areas, too. The holiday season is particularly challenging for the west country and other coastal resorts, which have become a destination of choice for young people who want to celebrate the end of their exams or generally have a good time. Sadly, dangerous levels of binge drinking too often become synonymous with such celebrations. My hon. Friend has referred to the tragic cases of Andrew Curwell and Paddy Higgins, the teenagers who lost their lives two years ago as a consequence of alcohol misuse. Many other young people have suffered life-changing injuries or circumstances as a result of accidents.
In a broader, national context, more than 1 million hospital admissions are alcohol-related, which is twice the number of admissions in 2003. Statistics also suggest that more than 40% of violent crime is alcohol-related. With that in mind, I am not surprised by the latest statistics relating to Newquay, which show that seven out of 10 drunk youngsters in Newquay were supplied with alcohol by their parents. Like my hon. Friend, I saw some outrageous examples of parental irresponsibility during my visit to the town last summer, when parents were providing their children with excessive supplies of alcohol. In one incident, the police confiscated 370 bottles and cans from a small group of teenagers, including a bottle of 63% rum, which was believed to have been supplied by a parent. I was astounded by the virtual mountain of alcohol that I saw seized by police in Newquay and the stories that I was told about parents abusing the police simply for trying to protect their children from harm.
What can we do to tackle the problem and change such behaviour? To start, the Government take a tough stance on alcohol. We are clear that we will not tolerate the scale of alcohol-related harms that have been experienced over the past decade. That is why we passed the Police Reform and Social Responsibility Act 2011, which introduces a package of new measures to rebalance the Licensing Act 2003 in favour of local communities. It gives local community leaders greater tools and powers to shape the type of night-time economy that they and their communities want to see.
We also take under-age drinking very seriously indeed and have used powers under the new 2011 Act to send out a strong signal. We have doubled the maximum fine available to the courts when sentencing irresponsible businesses that persistently sell alcohol to under-18s. However, my hon. Friend will be quick to point out that we are talking about not children who buy alcohol illegally themselves, but our response to parents who are prepared to give their children large quantities of alcohol.
As my hon. Friend has said, the law already enables the police to charge an adult with the criminal offence of buying alcohol on behalf of a child who is aged under 18. That offence carries a maximum £5,000 fine. In addition, the police can issue a penalty notice for disorder for the offence. Those powers give them an option to impose a swift financial punishment to deal with misbehaviour and provide a practical deterrent to future reoffending. The law also allows for the punishment of parents who are wilfully negligent towards their children, although, as my hon. Friend has said, only in relation to those aged under 16.
The use of such powers may not be relevant or appropriate in all circumstances, and it will depend on the facts of the case and on whether there is a reasonable prospect of conviction based on the available evidence. However, those powers provide the police with an option in criminal law. It is for local police to decide their response to local crime priorities.
I hear clearly the points made by my hon. Friend about the practical application of the law and certain offences. We will continue to listen and be guided by the Association of Chief Police Officers in connection with law enforcement. He makes an important point about ensuring that the law is used effectively and robustly. However, we do not want to legislate unnecessarily or be overly prescriptive. This is a difficult problem that needs careful consideration.
Parents are well placed to introduce alcohol to their children sensibly. The answer lies in educating them and their children. That is why we endorse initiatives such as Coast Safe and why the new alcohol strategy, which I shall discuss shortly, will address advertising and so on, a concern which several hon. Members have raised. Newquay Safe Partnership has introduced innovative schemes to address the town’s problems and has worked in conjunction with Drinkaware. Some have said that the Government should go further in reflecting good local practice that works well, which was great to hear. The success of such schemes results from good partnership work such as in Newquay, which involves not only the police but trading standards, the local authority and some responsible businesses. Many hoteliers in Newquay closely co-operate with the police, and we should not lose sight of the strong partnership links that have helped to make a difference.
People argue that we should consider the raising the age limit for consuming alcohol to 21, for example, as it is in parts of the United States. We have not gone down that route, however, because many of the problems that we have alluded to relate to much younger children. It is important, therefore, to focus our attention differently, which is why the Government have not been attracted to that route.
My hon. Friend has highlighted particular sections of the 2003 Act. I will consider closely his comments on proxy purchasing to find out what advice or guidance can be provided and how to work proactively with the police in that context. I highlight the ongoing work with other Departments. The Government are working on an alcohol strategy, and Department of Health Ministers have been playing a leading role. The strategy will consider the culture of drinking in our society and how commercial alcohol advertising and social networking play a role in that culture.
The chief medical officer has published guidance for parents, health professionals and young people emphasising the importance of parents in shaping behaviour. I agree that schools have a clear responsibility to prevent drug and alcohol use as part of their wider pastoral role, which will be supported by the revised, simplified schools guidance that the Department for Education is working on.
I am conscious that time is defeating us. I thank my hon. Friend for securing the debate. The Government are conscious of the issue, and the new Department of Health-led strategy, which will emerge soon, will touch on a number of the themes that he has rightly brought to the attention of the House. This is work in progress and more remains to be done, but the Government are taking things forward.
Ukraine
(12 years, 6 months ago)
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Helen Goodman (Bishop Auckland) (Lab)
It is a pleasure to see you in the Chair this lunch time, Mrs Riordan. I am extremely grateful to Mr Speaker for agreeing to let me have this debate on our relations with Ukraine at what is obviously a crucial time for that country. The trial and subsequent jailing of Yulia Tymoshenko, who was the Prime Minister of Ukraine and one of the key leaders during the orange revolution, has put Ukraine back on the front pages, and, unfortunately, not for a happy reason. It is important that we have this opportunity to consider what is going on and to ask the Government how they intend to respond to the situation.
We need to be clear that Ukraine is not a far-away country about which we know little. What happens in Ukraine matters very much indeed. It is the largest country in Europe and has a population of 40 million people. It achieved independent national status in 1991, and in 2004, during the orange revolution, the people of Ukraine demonstrated their commitment to and desire for a fully open liberal democracy. We should support all those people who have been campaigning for political reform in Ukraine and demonstrate, at what is clearly a difficult time for them, that we are concerned about what is going on in their country.
Ukraine also has a strategic significance for us and the rest of Europe. It is on the crossroads between Europe, Russia and the Caucasus, and has become one of the major corridors for oil and gas from east to west. That role as a corridor for energy transmission has provoked the recent crisis, because Mrs Tymoshenko was prosecuted for exceeding her powers in signing the deal with the Russians. Many in Ukraine feel that it has severely disadvantaged them, because it agreed too high a price for the gas. The situation is surrounded by many claims of corruption in Ukraine. I do not believe that many people outside Ukraine see this as anything other than a ham-fisted attempt by the current Ukraine Government to settle political scores and to exclude Mrs Tymoshenko from the political scene. Neutral observers from Denmark who are expert in looking at judicial processes have also made some serious criticisms about the way in which the trial was undertaken.
I was fortunate to be able to visit Ukraine in the first week of October. I am a member of the all-party group on Ukraine and I apologise on behalf of its chair, the hon. Member for Maldon (Mr Whittingdale), who cannot attend the debate. I visited Ukraine after the trial, but just before the sentence was announced, and met a lot of people. During that week, I did not meet anyone who thought that the trial was legally valid or morally or politically justified. I met people who were critical of Mrs Tymoshenko’s period in office and who had opposed her politically, but those self-same people were, none the less, critical of the trial and what had gone on. My impression is that the Ukraine Government embarked on that course of action without fully understanding the implications for their reputation either at home or abroad.
I do not think that it would be right for us to become completely fixated with the trial of one person, but unfortunately it seems to be part of a pattern of developments that has led from an open situation to an illiberal one. Other politicians in Ukraine, on both a regional and national level, have been put on trial on charges that some people think are trumped up. The judiciary is appointed by the Executive, so there must be question marks about how independent it is. A survey of the content of the state-owned television channel found that 97% of its broadcasts were supportive of the Government, which is a completely unbalanced situation. Moreover, although the presidential election of 2010 was felt to have been run on a free and fair process, there were more question marks about the way in which recent local elections were run. There are important parliamentary elections to come in a year’s time, so we need to look at the overall political situation in Ukraine. The Tymoshenko trial and sentencing highlight the issues.
Ukraine faces a major strategic choice. Negotiations have been ongoing for an association agreement with the European Union, and the Ukraine Government have repeatedly said that they want to go ahead with it. On the other hand, however, for historical reasons they are pulled towards Russia. I think that some people in Ukraine think that, as an alternative to going along with the EU association agreement, it might be desirable to join the customs union, which Mr Putin is putting together, between Russia, Belarus and Kazakhstan. The Ukraine Government need to find a way forward that maintains good relations with all their neighbours.
We in this country have a long democratic tradition. Our democracy goes through positive phases and phases whereby we may be a little concerned about what is happening, but we know that it takes a long time to build a democratic society. It is partly about institutions, formal arrangements and the law, but it is also about practices, behaviour, common and shared understandings, and the give and take required for a well-functioning democracy. Ukrainians face trying to achieve that with two significant handicaps. The first is the role that some of the oligarchs seem to play in their democracy, and the second is the economic crisis that they face. I was shocked to learn that the Ukrainian economy is 30% smaller now than when the country achieved independence in 1991. Not only is the economy smaller, but there is far greater inequality in the country. It is not therefore surprising that some people are not entirely enamoured of the new politics. High unemployment has led to high levels of emigration. It is unclear, but perhaps 3 million or 4 million people have left Ukraine. They will, by and large, be people in their 20s and 30s. Such a situation has left behind a number of social problems, for example, abandoned children and old people not cared for. Ukrainians really do have a lot on their plate.
We should not be too sanctimonious about the matter because it was advisers from Britain, the European Union and America who rushed over to Ukraine and the other countries of the near east in the 1990s and enjoined on them a process of privatisation. In retrospect, that process was too far, too fast. Major industries were sold at knock-down prices into monopolistic markets. Therefore, the people who bought them were able to exploit market positions and make speedy fortunes. That is particularly problematic at the moment because people are sending their profits out of the country to Cyprus, which is an offshore tax haven. That has created a situation in which economic decisions are politicised and political decisions are subject to economic pressures. There are many reports of corruption in the country. Furthermore, at the moment, Ukraine is vulnerable to the crisis in the eurozone because obviously those countries are part of its major export markets.
Having tried to set out some of the context, I would like to ask the Minister what the Foreign and Commonwealth Office will do about the negotiations for the EU association agreement. Over the past month or so, Ministers have made several statements. I hope that the Minister will tell us that our message is that the trial and sentencing of Mrs Tymoshenko is unacceptable. Is it his intention to halt the negotiations? Is that the position the British Government want to take?
While we are making clear what we find unacceptable, I would also like to ask the Minister what we are doing to strengthen civil society. When I was in Ukraine, I was disappointed to discover that the technical assistance programme has been halved in the past 18 months and that no Minister has found time to visit Ukraine since the general election. I encourage the Minister or his colleagues to visit Ukraine. It is very beautiful, very fascinating and also extremely important.
We need to make it absolutely clear that we expect Ukraine to be a country that respects civil liberties, where the judiciary is independent and the media are free. As well as setting some standards, we also need to offer some support to the Ukrainians.
The Minister of State, Foreign and Commonwealth Office (Mr Jeremy Browne)
Thank you, Mrs Riordan, for giving me the opportunity to wind up this brief but important debate. I am also pleased to have my first chance to speak under your chairmanship.
I congratulate the hon. Member for Bishop Auckland (Helen Goodman) on securing the important debate at a time when there is deep concern in Europe about recent developments in Ukraine. More generally, there is a tendency for many hon. Members to use Westminster Hall to raise constituency issues, which is quite appropriate. However, it is nice to have wider debates that affect our national interest and broader values as a country, and for hon. Members to be able to come to Westminster Hall and discuss such topics.
To assess the implications of the conviction of former Prime Minister Tymoshenko, we need to look at the wider picture and broader erosion of democratic standards in Ukraine during the past 18 months. The hon. Lady said that she regretted that no Minister had recently been to Ukraine. The Minister for Europe would have responded to the debate if he had not been travelling. He is not in Ukraine—I cannot remember which country he is in at the moment—but he travels frequently. I am sure he would welcome the chance to visit Ukraine at the earliest opportunity.
We need to consider the erosion of democratic standards in Ukraine and to answer the following question: why does Ukraine and what happens there matter to us in the United Kingdom? A stable, prosperous and democratic Ukraine that is anchored to European and Euro-Atlantic institutions is in the United Kingdom’s national interest for several reasons.
As the hon. Lady said, first, Ukraine is of immense geo-strategic importance, as it borders four European Union member states and, of course, Russia. We must also consider the size of the Ukrainian market, coupled with its near double-digit gross domestic product growth potential. That might not be the same as having double-digit growth but, if political and other institutions were put on the necessary footing, there is clearly the prospect for Ukraine to become an increasingly economically prosperous country. Obviously, that would offer significant opportunities to UK exporters and investors, as well as being of more immediate benefit to the people of Ukraine. Ukraine is also making a significant contribution to safeguarding international security. For example, it is the only non-NATO partner that regularly contributes to NATO missions.
Finally, Ukraine is a major part of the European energy security jigsaw. It is an important transit route from the east to Europe, with 80% of Russian gas sold to EU customers transiting through Ukraine. Of course, that matter is the nub of the issue, but it is also hugely important to the Ukrainian economy and makes the country more widely important in terms of the energy requirements of countries elsewhere in Europe. Ukraine’s closer integration with the EU offers the surest way of ensuring that not only Ukraine’s long-term interests, but ours and those of our European partners are met. If developments in Ukraine are damaging its prospects for EU integration, it is a matter of concern for the UK and our EU partners, as well as being of more narrow and immediate concern to the people of Ukraine.
Ms Tymoshenko’s conviction and the ongoing cases against a number of her former Ministers and officials give rise to serious concerns about where Ukraine is heading. Those concerns are a symptom of broader problems in Ukraine. We also have worries about blurring divisions between the three branches of power—the judiciary, the legislature and the Executive—and about the erosion of media freedoms and a worsening of the business climate as corruption becomes more prevalent. There is an unhappy cocktail of transgressions of liberalism. It is not simply a matter of considering the trial in isolation or how politicians are treated by the courts. There is a wider issue about civic society and its ability to debate and consider issues through the media and elsewhere, and the overall atmosphere in which business is conducted.
In the case of Ms Tymoshenko, it is worth stressing that it is not for the UK to comment on the guilt or innocence of any individual in a court case. Our concerns, which are supported by the views of international experts, relate to processes and principles. In this case, we are specifically concerned about the political motives behind the prosecution without sound legal grounds of Opposition figures, and the way in which any trials are conducted.
The Danish Helsinki Committee for Human Rights, which has been following several trials including Ms Tymoshenko’s, recorded several serious violations of fundamental legal principles in direct contradiction of common European values. Such a damning conclusion by such an esteemed observer should give us pause for thought and concern. Moreover, as friends of the Ukrainian authorities and as advocates of their EU integration, we have an obligation to tell them when their actions are incompatible with their ambitions. It is regrettable that, so far, our clear and repeated expressions of concern appear to have fallen on deaf ears.
It is worth stressing that point: the Government wish Ukraine well. We wish to see the country develop, play a full part in Europe and have a positive relationship with the European Union on many different bases—culture, commerce, educational collaboration and politics. However, all that depends on Ukraine’s improving its basic civic processes. We are keen to make those points clear to Ukraine. We are frustrated that, given those points were made in a spirit of friendship and in wishing the best for Ukraine, we have not so far managed to make more progress in convincing many people in Ukraine that that is the best way forward for their country.
There can be no doubt about the UK’s position. Only a few weeks ago, on 12 October, my right hon. Friend the Prime Minister told the House that
“the treatment of Miss Tymoshenko…is absolutely disgraceful. The Ukrainians need to know that if they leave the situation as it is, it will severely affect their relationship not only with the UK, but with the European Union and NATO.”—[Official Report, 12 October 2011; Vol. 533, c. 329.]
Ukraine tells us that it wants to join the European Union one day. The UK continues to support that objective. We remain enthusiastic about further enlargement of the EU to the east, if the criteria are right and the circumstances are correct. However, that cannot happen until Ukraine shows that it adheres to the highest democratic standards, including respect for human rights, the rule of law and an independent, transparent and fair judicial process. The conviction of Ms Tymoshenko and the ongoing cases against other former members of the Government call into question Ukraine’s commitment to those values, and could pose a major obstacle to the signature and ratification of the association agreement, and the deep and comprehensive free trade agreement with the EU.
It is right to stress, not least because the EU has been the subject of some debate here in the UK in recent weeks, that those core values, to which member states are required to subscribe as a condition of membership of the EU, offer us and others a powerful lever for raising standards across the continent as a whole and persuading aspirant members of the desirability of advancing in a way that means that they meet the standards that we, in this country, often take for granted.
What exactly has to happen for us to be able to continue to support Ukraine’s integration with the EU? The UK, along with our EU partners, wants to see all Opposition leaders, who have been detained on the basis of flawed trials, freed and able to participate in the political process, including in next year’s parliamentary elections. Ukraine needs to show the political will to move towards joining the European club by embracing—not just in words, but deeds—the EU’s values. The challenge facing the Ukrainian authorities is therefore clear, and we very much want to make that explicit to them.
Arising from this debate and from our wider diplomacy, I hope that there will be no ambiguity about the position of not just the British Government, but the British Parliament and British society. In these debates, I am always struck by how much agreement there is and how much all of us in this House, who may have differences of opinion on domestic political issues and occasionally on international political issues, nevertheless share the core principles and values of democracy and civic society that are embodied in how we practise politics in this country, and are happily embodied in European Union. We wish to see them practised more widely still, including in other European countries that are not—or at least not yet, in some cases—in the European Union.
Some might ask why we should remain so open to Ukraine when we have imposed sanctions on Belarus, for example, for detaining Opposition leaders. The Government’s view is that Ukraine is in a very different category from Belarus. While we are bitterly disappointed by recent developments, Ukraine remains among the most democratic states in the Commonwealth of Independent States. Belarus, by contrast, is one of the most repressive countries not just in Europe, but in the world. We remain convinced that the association agreement and the deep and comprehensive free trade agreement represent the best opportunity to embed democracy in Ukraine, transform its economy and contribute to long-term stability and prosperity in Europe. It is the Government’s strategy to have that engagement—not to regard Ukraine as beyond the pale, but to demonstrate the criteria it needs to fulfil and the progress it needs to make to become a mainstream and successful European country.
We are making those points in concert with our EU partners. The Government’s main objective is to encourage Ukraine to take the steps necessary for European integration, and to speak frankly and critically when necessary while underlining that adhering to the core EU values of democracy, fundamental freedoms and the rule of law is a prerequisite for closer association. Let me emphasise the next point so that there is no mistake either here, or for anybody in Ukraine who chooses to read the transcript of this debate: as far as the UK is concerned, the core principles of democracy, fundamental freedoms and the rule of law are non-negotiable. They are not a point on which we can seek to reach a halfway house with Ukraine. The EU-Ukraine summit in December will be an important opportunity for the Government to make that position clear, and we intend to do so.
We firmly believe that we should proceed with the initialisation of the association agreement, indicating that negotiations have been concluded and locking in almost four years of hard work. However, we should make it clear that formal signature by the EU and member state Governments, followed by ratification by the European and member state Parliaments, will be jeopardised without a satisfactory resolution of politically motivated trials and convictions. I urge the Ukrainian authorities to reflect on that point.
Helen Goodman
Why should the association agreement be initialised? One way to proceed would be for us to say, “Well, this has happened; now we are going to put the brakes on”, rather than saying, “Well, we will sign this thing in a month’s time and then there is a whole year for Ukraine to make adjustments”. Why is the Minister not going down that route?
Mr Browne
My understanding is that the judgment being made is, given that four years has been spent in trying to bring to a head this body of work, it would make sense to consolidate it at this stage. However, that does not commit us, as a Government or as a country, to proceeding through to ratification either here in Parliament or at European level. There is no commitment with which we are then obliged to follow through, if that initialisation is completed.
This is not about backing Ukraine into a corner; it is about reiterating those core democratic EU values that Ukraine has adopted in part, and which underpin integration with the EU. That is the same process of integration that the Ukrainian authorities tell us is their strategic objective. President Yanukovych came to power promising to make Ukraine
“a modern and dynamic country”—
and he has consistently identified EU integration as his No.1 priority. The majority of his people support him in that ambition. The UK and our EU partners have explained to Ukraine what it needs to do to make integration with the EU a reality. The door remains open. We wish to make it clear to Ukraine that the door remains open and we will not slam it at this stage in proceedings, to answer the hon. Lady’s question further. It is for Ukraine to decide whether it wishes to commit to EU standards and cross the threshold. The Government hope that it will decide to do precisely that.
Cruise Ship Safety
(12 years, 6 months ago)
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Stephen Mosley (City of Chester) (Con)
In March this year, a constituent of mine, 24-year-old Rebecca Coriam, disappeared while working for a British employment agency on a Bahamian-registered, American-based, Disney cruise ship in international waters off the coast of Mexico. Rebecca was living her dream, working as a member of the youth staff on the cruise ship, Disney Wonder, which was cruising out of Los Angeles on a seven-day cruise along the Mexican coast. Rebecca was last seen shortly before dawn on 22 March. She failed to report to work at 9 am and the alarm was raised shortly afterwards. The crew initiated a search of the ship, and she was listed as missing at sea. While the Disney Wonder sailed on to her next destination, the Mexican coastguard searched the waters behind the ship and found nothing. The Disney Wonder is registered in the Bahamas and, under international maritime law, it is the responsibility of the Bahamas Maritime Authority to investigate Rebecca’s disappearance. Despite an ongoing investigation of more than seven months, Rebecca’s family are still awaiting news of what happened to their daughter.
The reason for calling the debate is the recognition that while international maritime law requires cruise ships to take every possible measure to provide safe passage, those measures are often ambiguous and are incorporated into UK and international law through a variety of legislation. When something goes wrong at sea, it is frequently impossible to establish responsibility and to ensure a thorough investigation. Victims are often left without protection, without support and with little prospect of securing justice.
Cruising is now one of Britain’s favourite holidays, with around one in nine package holidays being cruise vacations. The number of people cruising has doubled in the past 10 years, including around 1.62 million British people last year. Despite the global recession, the UK cruise industry expects to reach a total of 2 million passengers by 2014. Cruising also has the massively beneficial effect of bringing tourists to the UK. In 2010, a record 116 ships visited 47 UK ports from 53 different cruise lines, bringing 541,000 visitors to the UK. Those figures are more than double those recorded as recently as for 2003. Yet how many of those holidaymakers, passengers and crew realise that, if something goes wrong on their ship, they may be almost totally unprotected?
The first issue with incidents at sea is that national jurisdiction extends only so far beyond a nation’s border. Once a ship is more than 24 miles from any coastline, it is on the high seas, in international waters, and the law of that ship is then the law of the country whose flag it flies and responsibility for crimes on board the ship lies with the legal authority of that country. That in itself creates a number of problems, because, to avoid stringent safety rules and regulations and for tax purposes, many cruise companies register their ships in countries with little affiliation to the actual operation of their company. For example, nine of the largest cruise companies operating in the UK, which regularly carry hundreds of thousands of British citizens every year, have a total fleet of 93 cruise ships: 42 are registered in the Bahamas, 25 in Bermuda, 15 in Panama, four in Malta and one each in Cyprus, Italy, Ecuador and Liberia. As for the three remaining ships, when preparing for the debate, I could not track down in which country they were registered.
In Rebecca’s case, the Disney Wonder cruise ship was registered in the Bahamas. If I briefly describe the investigation that took place into Rebecca’s disappearance, it will become obvious why I have serious concerns about the protection of British citizens while at sea. One officer from the Bahamas Maritime Authority boarded the ship—one officer, three days after Rebecca’s disappearance, for a ship with a capacity of 2,700 passengers and 950 crew. Little formal questioning of the ship’s crew or passengers occurred, little effort was made to gather or secure evidence and little if any forensic investigation took place on board. After seven months, Rebecca’s family are still awaiting news of what happened to their daughter. How could we have allowed that to happen to a British citizen? We have the disappearance of a young Englishwoman, hired by an English corporation to sail on a cruise ship out of a US port, and yet not a single British or American police or forensic team went on board the cruise ship in the days following her disappearance.
Contrary to that pitiful investigation, however, the Foreign and Commonwealth Office website, under “Travel & living abroad” then “Cruise ship passengers”, states:
“Significant crimes against British nationals on any ship can in certain circumstances be reported to UK police and may be investigated even though they occurred outside the territory of the UK.
A crime may also be reported to the authorities in the port/country in which the ship was docked (or was headed) when the crime was committed with the result that local law enforcement agencies may also be involved in the investigation”,
yet only one officer from an authority that is internationally recognised as almost toothless investigated the disappearance of a British citizen. In my opinion, that is appalling.
I myself am an enthusiastic cruiser, and I do not intend to berate the British cruise industry. I like to think of myself as someone who pays attention to detail when taking my family abroad, and yet before I was approached by the Coriam family in March of this year, I had no idea, if anything happened to me or my family on board a cruise ship, that the UK authorities or even the authorities in the countries that we were visiting would be impotent to help me seek justice. The Minister must acknowledge that the risks associated with the practice of flagging ships in obscure countries, such as the Bahamas, Panama, Liberia or Ecuador, are unknown to the vast majority of those 1.6 million British citizens who cruise each year. Passengers must be made aware of the jurisdiction that they will be sailing under before they book a cruise holiday and of the potential downsides of sailing under a flag of convenience.
If people go on holiday to the Bahamas and something happens to them, they expect it to be investigated by the Bahamian police. If people were to fly from London to Hong Kong in an aircraft, they would quite rightly not expect the Bahamian police to investigate a crime that happened on board. For crimes in the air, because of the Tokyo convention of 1963, the country of landing has jurisdiction. Similarly, if people go on a cruise ship owned by a US company sailing off the coast of Mexico, they do not expect to be totally reliant on the Bahamian police. If airlines can sort out the problem of jurisdiction through the Tokyo convention, why cannot cruise ships? Rebecca’s case highlights the urgent need for greater clarity of jurisdiction if we are to sufficiently and swiftly seek justice on behalf of British citizens.
I want to make it clear that not only cases of missing people must be considered when discussing crimes at sea. Violence, theft and sexual assault also occur on cruise liners, and investigations are often as fruitless as in the cases of missing persons. There are no centrally collated records of crimes at sea. In fact, many cruise ships are not even required to keep their own logbook of incidents on board. It is not unsurprising that cruise ships and cruise companies do not publish the number of offences that occur on board, and only by trawling through international records and news reports and through contacts with victims and their families can campaign groups such as the International Cruise Victims association and Victim Support collate figures. International Cruise Victims states that at least 165 people have gone missing at sea since 1995, with at least 19 so far this year alone.
Sexual crime on board cruise ships is also a problem. Incidents of sexual assault and sexual victimisation are significantly more common on board cruise ships than on land. The south Florida newspaper, the Sun Sentinel, obtained copies of FBI reports of serious crimes on board cruise ships between December 2007 and October 2008. The sexual assault and sexual contact reports from just one ship, the Carnival Valor, which is registered in Panama, indicates the possible scale of the problem: 15 January 2008, female passenger victim; 21 January, female passenger victim; 6 March, female passenger victim; 21 March, 16-year-old female victim; 24 March, female crew victim; 8 June, female crew victim; 13 June, 16-year-old female victim; 9 September, female crew victim; 17 September, female passenger victim. Just one ship in less than one year reported nine sexual assaults and sexual contacts to the FBI.
Improving the prevention and investigation of crimes at sea needs a twofold approach, which includes tightening safety regulations governing cruise ships and clarifying international co-operation when investigating crimes. Last year in the United States, President Obama signed into law the Cruise Vessel Security and Safety Act 2010, which is designed to increase security, law enforcement and accountability on cruise ships in international waters and for ships that visit US ports. I urge the Minister to consider implementing a similar Act in the UK. Bringing together the variety of laws that currently govern cruise ships into one concise and comprehensive set of regulations would go some way to improving the safety of cruise ships. However, that is only the tip of the iceberg.
The Minister will doubtless tell us about the extremely high standards that pertain to ships flying the red ensign, and he will be totally right. However, by the end of this year there will be no cruise ships registered in the UK. The last three ships—the three Cunard Queens—have re-registered in Bermuda in the past few days. He will also tell us about the high standards imposed on ships registered in Crown dependencies, and he will be right about that, too. I am sure that he will also tell us about the high standards that the UK imposes on cruise ships that dock in the UK, about which he will also be right. However, the vast majority of British cruise passengers sail ships registered in different jurisdictions, which might be the Bahamas, Panama or Liberia. The majority of British cruises now sail from ports outside the UK, of which there were almost 1 million in the past year alone.
When it comes to crime against British subjects on ships registered with a flag of convenience from ports outside the UK, British nationals such as Rebecca can be almost alone and unprotected if they are the victim of crime. They may not even be aware of that until it is too late. It is vital that passengers be made aware of the jurisdiction they will be sailing under before they book a cruise holiday, and they must be made aware of the potential downsides of sailing under a flag of convenience.
It is also imperative for the UK authorities to take greater responsibility for investigating crimes against UK nationals that occur on the high seas. I urge the Minister to work with the Foreign and Commonwealth Office to co-ordinate with the International Maritime Organisation and with international law enforcement agencies such as Interpol to help synchronise a more coherent structure for criminal investigations in international waters and on ships flying flags of convenience.
More needs to be done to safeguard British citizens on cruise ships. I hope that the Minister and his Department will take on board these concerns and ensure that action is taken to do just that.
The Parliamentary Under-Secretary of State for Transport (Mike Penning)
It is a pleasure to serve for the first time under your chairmanship, Mrs Riordan. I congratulate my hon. Friend the Member for City of Chester (Stephen Mosley) on securing this debate. He will acknowledge that I have met Rebecca’s family, and I have made promises, which I will keep.
I pay tribute to Rebecca’s family. They have had a tragic loss, which has been exacerbated by not knowing what actually happened to her. However, that has not stopped them campaigning for justice for Rebecca and for other victims in not only cruise ships but the whole maritime fleet.
Cruising is a boom industry; it is popular. My hon. Friend mentioned the figures: 1.7 million Brits went on a cruise this year, and the figure is 20 million around the world. The vast majority of them have cruised in safety, although I accept my hon. Friend’s point. The figure of 1.7 million is due to rise to 2 million in the next three to four years. We must not be complacent. There are things that we as a nation have control over and things over which we have no control. Sadly, Cunard has recently announced that the three Queens have been re-flagged outside the UK. Weddings were a particular issue for cruise lines. I got married in an old-fashioned church, but these days people want to get married in myriad different places, including on cruise ships. Under British law, people cannot get married on a British ship, but I will amend the legislation as soon as I can so that people will be able to marry on board a ship. Weddings can be held in many different places in this country, but not on a British ship, which is ludicrous.
There is no doubt that the infraction proceedings and the mess I inherited from the previous Administration on differential pay has meant that we are having some ships flag away. That is very sad, and I have done everything possible to help, but the blame lies firmly with the National Union of Rail, Maritime and Transport Workers and the Nautilus union. They took the British Government to the European Commission for not implementing legislation. I hope that they have seen the error of their ways, because we are now seeing British jobs and British ships being flagged abroad.
I am sure that my hon. Friend will agree that crime takes place not only on cruise liners, but in merchant fleets around the world. One of the most serious crimes, rape, has taken place, and has clearly not been investigated properly. Cases of missing persons, as in the case of Rebecca, have also not been properly investigated. The simple truth is that the country in which the vessel was flagged is not capable of doing the sort of investigation that we and Rebecca’s family would like. As far as I can work out, it did hardly anything; it was very half-hearted. I am sure that Disney is conscious of its image, but it was more interested in getting the ship back to sea than in investigating the case of the missing member of their crew.
I pay tribute to Rebecca’s family and the dignity that they have shown. I made promises about what I could do immediately, which included writing to the Bahamian authorities and asking them to inform me exactly where the investigating was going. I also instructed the marine accident investigation branch to register the UK as a substantially interested body. I have instructed the branch to register a substantial interest in every case where there is a British citizen involved on any ship anywhere in the world. That is a significant move. It is not something that we had been planning on doing, but this particular case has opened our eyes as a country. We are using the skills of the marine accident investigation branch, which is world-renowned. If a British citizen happens to be on holiday on a cruise liner—not on a beach—they should get the protection that we would normally expect from a British Government.
We have also been supportive of the Cheshire police, to whom I pay tribute. They have taken on the mantel and been heavily involved, but they have been frustrated by the way the case has been handled. We and the Foreign Office will continue to support them in the ongoing investigations.
Last year, I attended a conference of red ensign Crown dependencies in Jersey—I am the Minister responsible for the red ensign not only in the UK but in other Crown dependencies. I stated that flag states have a detailed, moral and ethical responsibility towards those who travel on their flagged ships; I do not think that point has been highlighted in that way, and I shall continue to emphasise it. At the conference, a senior police officer made exactly the same point as that raised by Rebecca’s family and my hon. Friend. Who takes responsibility for an investigation into something that did not happen on a flagged ship? That is a difficult question, and we have had many meetings to look at where the responsibility lies.
My hon. Friend alluded to the Americans and, like me, President Obama is in an interesting position. Although I have a large number of flagged vessels, I do not have any cruise ships under me, and neither does President Obama. When we talk to the rest of the international community about how to join investigations together and be taken seriously, we must be careful not to preach to people about things for which we are not responsible in the same way. As I am sure my hon. Friend knows, the American flagged fleet is small and insignificant in world terms, which is unusual for such a huge nation. That is because many years ago, America flagged off many of its ships to Panama and the Marshall Islands for political reasons. We must not be hypocritical in telling countries what they should do when we do not have responsibility for cruise ships.
As I stated earlier, however, this issue goes beyond cruise liners. It is crucial that people feel safe on a ship, whether they are at work or travelling for leisure, and whether they are on a cruise liner or, speaking more loosely, a cargo freighter going round the coast on a regular basis. The issue is also crucial for women—I will be slightly sexist on this point—because historically women did not serve on ships in the way they do today. I have had the pleasure of presenting the cadet of the year award for the past two years—I have managed to survive that long in this job—and each time the merchant navy cadet of the year was a lady. That shows where the industry is going, and the skills and expertise that women can bring to it. At the same time, however, women need to be protected. Sadly, I have read about an instance of a female crew member who was raped. The incident was not investigated properly and was followed by a suicide. That did not happen in our territorial waters, but that is not the point. Such things do happen.
I promised Rebecca’s family that I would do everything I can to help, and that I would go to the top when looking at international responsibility. The International Maritime Organisation is based just across the river in a Department for Transport building—my colleagues will love my mentioning that—which is the only United Nations establishment in the United Kingdom. As promised, I wrote to the IMO’s outgoing secretary-general detailing not only Rebecca’s case but the other cases that we have heard about. I had a follow-up meeting with the secretary-general and his officials, together with the incoming secretary-general from Japan, who will take over in the new year. That meeting was very positive and unlike in previous attempts by the US, we appear to have started to pull a consensus together.
The IMO safety committee agreed guidelines previously at the 89th committee, and we will table a motion, to which I hope other member states will agree, asking the security council within the committee to look formally at the whole issue on an international basis. That will not, of course, take away from the responsibilities of individual member or flag states within their territorial waters, but it will start to implement a correct procedure for events that occur on what we commonly call the high seas. That is hugely important to Rebecca’s family and others who, in many ways, have had their lives destroyed by events on the sea.
The international community can no longer ignore its responsibility to ask, through the IMO, how we can better deal with such situations. Countries used as flags of convenience—for want of a better word—need to cope with the investigations that are necessary when certain events happen, as sadly we know they will. Some of the ships are like small towns; the largest has 7,000 guests and 2,000 crew members. That is bigger than many of the towns we represent; it is like two wards in my constituency, all on one ship. When there is such a cramming together, there will be good and bad people there, just as in any other society.
People go on holiday, just as I did as a young man when I went to Benidorm all those years ago. They want to have a good time, but others spoil it for them. That happens, and there are criminals in our society. If someone rapes, they are a criminal; if they are involved in crime on a ship, no matter where in the world, they are a criminal. It is therefore important to pull together and look at how to address the situation. The crux of my hon. Friend’s argument is that where we do not have responsibility for the ship and the flag nation is not capable of addressing its responsibilities, we must look at how the international community can pull together.
I passionately believe that we have some of the greatest police authorities in the world. The Association of Chief Police Officers has shared guidance on best practice, which is used extensively around the world. My hon. Friend will probably agree that we also need to name and shame some of those cruise operators that do not take their responsibilities—for want of a better word—as carefully as they should.
We must not, however, denigrate all ship companies. I have a cutting in front of me from the Evening Standard. It mentions a P&O-registered ship that had a man overboard the other night in the middle of the Atlantic ocean. A passenger saw what they thought was someone in the water and raised the alarm. The ship dispensed three lifeboats and many lifebuoys, made a complete U-turn and—miracle of miracles—the man was pulled out alive. I think that P&O should be praised, and particularly the captain of the ship involved, the Ventura. The ship obviously had a code of best practice and a set of skills in place so that it could respond to such an event.
I have also heard of instances where a ship has hit a trawler in the English channel and a fisherman has died. The ship knew it had hit someone, but carried on. Those are two extremes in an industry that is expanding not only because there are a greater number of cruise ships, but because of the sheer size of the ships to which our ports now have to adapt. The largest ship in the world, the Emma Maersk, can function with a crew of 13 or 14 people. How can they respond to certain situations?
We must also not take away from the responsibilities of the one person who I have not yet mentioned—the captain of the ship. The captain of a ship on the high seas is the sole person responsible for the ship. If the ship is flagged by any country, including the UK, that country also has responsibility, as does the international community.
We have fulfilled the promises I made to Rebecca’s family in my office a few weeks ago, but we will not be complacent in any shape or form. We will push on. There is an IMO conference in London later this month. There are some indications that, as I hope, our proposals will be supported, and we can show the rest of the world that, yet again, the UK is leading in safety on the high seas.
Question put and agreed to.
Written Ministerial Statements
(12 years, 6 months ago)
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Skills Funding Agency
(12 years, 6 months ago)
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The Minister for Further Education, Skills and Lifelong Learning (Mr John Hayes)
I would like to inform Parliament that the Government are today announcing a review of the status of the chief executive of skills funding and the Skills Funding Agency—the body which supports him in carrying out his statutory duties.
The review is consistent with the Cabinet Office public bodies review programme, and reflects the requirement placed on all Government Departments to undertake a regular review of their key delivery bodies, and the Government’s ongoing commitment to radically increase the transparency and accountability of all public services.
I will be writing today to the further education and skills sector and to key stakeholders more widely about the review; and can confirm that both the Skills Funding Agency and wider stakeholders will be fully engaged in the review process, while meeting the core principles set by Cabinet Office of ensuring that any wider consultation is proportionate and provides clear value for money.
It is vital that we have the right structures in place to tackle the very real challenges that lie ahead; and this review reflects the Government’s ongoing commitment to building on the strength of the further education system, while ensuring rigorous accountability structures are in place.
We will make a further announcement about the outcome of the review in due course.
Local Democracy
(12 years, 6 months ago)
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The Minister of State, Department for Communities and Local Government (Greg Clark)
The Government have today launched a consultation, “What can a mayor do for your city?” We are asking local communities to contribute their views on the powers that directly elected mayors should be able to exercise in the 12 largest English cities outside London.
The Government are committed to helping all of England’s cities thrive. Experience from London, and from other towns and cities in Europe and beyond, shows that directly elected mayors can provide strong and visible leadership, increase accountability for local decisions, enhance their city’s prestige and maximise the potential for local economic growth.
In the coalition agreement, the Government committed to creating directly elected mayors in the 12 largest English cities outside London, subject to confirmatory referendums and full scrutiny by elected councillors.
Leicester has already elected a city mayor. The Government are now planning referendums in 11 other cities—Birmingham, Bradford, Bristol, Coventry, Leeds, Liverpool, Manchester, Newcastle-upon-Tyne, Nottingham, Sheffield and Wakefield—to take place in May 2012. Where local people vote in favour, these cities will move to a directly elected mayor.
The Government start from the assumption that each of our cities is unique, facing challenges and opportunities shaped by its history and location. We think city mayors will be able to do their job best when their remit and powers properly match local circumstances.
Rather than simply seeking to impose a “one size fits all” approach, then, we think cities themselves should have a strong say over how mayors can help their city thrive. With this consultation, we are inviting contributions from the people who live and work in the 12 cities on which powers they believe a city mayor, where elected, should be able to exercise on their behalf.
This approach is in line with the Government’s commitment to localism, and to the ongoing success of England’s cities.
I am placing copies of the consultation document in the Library of the House. The Government are inviting responses by 3 January 2012.
Junior ISAs (Looked-after Children)
(12 years, 6 months ago)
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The Parliamentary Under-Secretary of State for Education (Tim Loughton)
In March of this year, the Chancellor of the Exchequer announced that the Government would provide support for the long-term savings of looked-after children through junior ISAs. Today, the day that junior ISAs first become available, I can announce that around 55,000 looked-after children across the UK will benefit from a new junior ISA in 2012, with an initial payment of £200 from the Government.
I am particularly grateful for the support of Barnardo’s and Action for Children, with whom we have worked closely to ensure we get the best scheme for as many vulnerable children as possible. The scheme will provide a junior ISA for every child looked-after for 12 months or more and who did not previously benefit from a child trust fund (CTF). This includes those born after the CTF scheme was stopped, as well as older children who were born before the CTF scheme was created.
I am also pleased that, as for previous support to looked-after children under CTFs, this new scheme will apply equally to looked-after children across the UK. I am grateful to the Cabinet Secretary for Education and Lifelong Learning in Scotland, the Deputy Minister for Children and Social Services in Wales and the Minister for Health, Social Services and Public Safety in Northern Ireland for their support for our work. Officials at the Department for Education will continue to work with officials in those administrations as we put the scheme into practice.
The Government want to ensure that looked-after children receive the best possible support and gain the same experience as any other young person. These savings will help them when they reach 18 and are facing difficult choices as they start out in the adult world. I am confident that, when combined with financial education, holding a real financial asset in a savings account will encourage these young people to learn about how to manage their money well.
These children are some of the most vulnerable in our society and we are committed to investing in them so they can thrive. I want these savings to be worth much more than £200 by the child’s 18th birthday and I hope individuals and organisations will also want to use these accounts to contribute and invest in the futures of these vulnerable children.
The Department for Education will shortly be launching a tender exercise to select the best partners to operate the scheme. Potential partners will need to demonstrate not just that they can make the right investment choices for looked-after children, but that they can raise additional funding from voluntary contributions. A key priority will be the ability to operate the scheme with low administrative costs. This will give generous individuals and organisations the opportunity to channel financial support directly to those who are most in need, helping looked-after children take the chances that may otherwise be denied them.
Universal Credit
(12 years, 6 months ago)
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The Secretary of State for Work and Pensions (Mr Iain Duncan Smith)
Today the Department for Work and Pensions announces its strategy for moving 12 million working-age benefit and credit recipients on to universal credit by 2017.
Universal credit is intended to provide a streamlined welfare system which makes the financial advantages of taking work or increasing hours clear to claimants. We recognise that the move from one welfare system to another needs to be carefully managed to ensure social outcomes are maximised and no one is left without support.
The transition from the old benefit system to universal credit will therefore take place in three phases over four years, ending in 2017 with around 7.7 million households receiving more support to find more work and be more self-sufficient.
Between October 2013 and April 2014, 500,000 new claimants will receive universal credit in place of jobseekers allowance, employment support allowance, housing benefit, working tax credit and child tax credit. At the same time a further 500,000 existing claimants (and their partners and dependants) will also move on to universal credit as and when their circumstances change significantly, such as when they find work or when a child is born.
From April 2014 the second phase will give priority to households who will benefit most from the transition, such as those working tax credit claimants who currently work a small number of hours a week but could work more hours with the support that universal credit brings. Overall 3.5 million existing claimants (and their partners and dependents) will be transferred on to universal credit during this second phase.
The last and final phase, which begins at the end of 2015 and runs through to the end of 2017, will see around 3 million households being transferred to universal credit by local authority boundary. This phase will have the flexibility to respond to the circumstances of particular local authorities as they change and will focus on safeguarding financial support, such as housing benefit payments, to claimants as the old benefit system winds down.
The Department for Work and Pensions will continue to work with HMRC and local authorities to settle on a precise timing schedule of the move to universal credit. Once agreed, the schedule will be kept under regular review.
Grand Committee
(12 years, 6 months ago)
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Arrangement of Business
(12 years, 6 months ago)
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The Deputy Chairman of Committees (Lord Geddes)
My Lords, according to the somewhat oversized electronic clock, it is now 3.30. With apologies to those who have been here for the previous eight days of the Grand Committee stage, I will read out the details of what is to happen with Divisions and voting. If there is a Division in the Chamber while we are sitting, this Committee will adjourn as soon as the Division Bells are rung and resume after 10 minutes. I remind your Lordships of the new procedures during Grand Committee on the Bill for Divisions. Members who have registered with the Clerk of the Parliaments may vote in their places in Grand Committee provided that they are present in the Grand Committee three minutes after the Question is put in the Chamber. Members who have not registered or who are not here at the three-minute mark will not be able to vote in their places. I also ask noble Lords to make sure that they speak up, but please do not touch the microphones because that upsets the system. Finally, perhaps I may add something that is not on my brief. Please will Members remember to turn off their mobile phones?
Welfare Reform Bill
(12 years, 6 months ago)
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“(4) Prescribed circumstances should include a claimant who is—
(a) a responsible carer for a youngest child aged 5 and 6, and(b) is undertaking further education and training up to and including level 3 until—(i) their youngest child reaches the age of 7, or(ii) their further education or training course ends.”
Baroness Lister of Burtersett
My Lords, I shall speak also to Amendment 71JA. These amendments have been tabled with the assistance of Gingerbread. The aim is to protect the opportunity for responsible carers to access further education and training up to and including level 3 when their children start school without facing the risk of sanctions. This means that responsible carers would be deemed to be fulfilling work search and availability requirements while studying until their youngest child reached the age of seven or the course ended. These amendments strike me as eminently reasonable, and indeed should be seen as totally consistent with the Government’s own anti-child poverty and social mobility strategy which emphasises the importance of education and training and the contribution they can make to ensuring that paid work represents a genuine path out of poverty.
The level to which a person is educated has a significant influence on how much they can earn and their ability to move up the earnings ladder. As Gingerbread points out, it is well established that holding a level 3 qualification can provide substantial economic value, particularly in relation to marginal wage returns. For example, only 25 per cent of people aged 25 to 29 holding a level 3 qualification are earning less than £7 per hour compared with 55 per cent of those with a level 1 qualification, and 37 per cent of those at level 2. Level 3 qualifications include access courses to HE as well as vocational courses. It makes long-term sense to enable lone parents in particular to improve their educational qualifications so as to maximise their labour market opportunities.
Until recently, lone parents on income support could complete a full-time further education course up to and including level 3 in preparation for entering the labour market or higher education. This meant that lone parents on income support had a two-year window of opportunity to access training with a fee remission when their children started school and before moving on to jobseeker’s allowance when their youngest child turned seven. As of September 2011, lone parents claiming income support are no longer eligible for fee remissions when accessing further education. Lone parents on income support will now have to self-fund as well as pay for any necessary childcare if they want to improve their chances of employment by undertaking training. Instead, fee remissions are available for individuals in receipt of JSA, but claimants will be required to continue actively seeking work while training, and if offered a job, be prepared to drop out of a training course or face a payment sanction. JSA work search and work availability requirements severely limit lone parents’ ability to train and gain skills that could help them find higher paid employment that is sustainable, and to make the most of opportunities to progress once working.
This modest amendment raises larger questions about some inconsistencies in government policy. On the one hand, as I have said, education and training are key elements in their child poverty and social mobility strategies. On the other hand, they are pursuing what in the jargon is called a “work first” rather than a “human capital development” approach to moving people from benefits into paid work. One of the risks of such an approach, identified by, for example, Dr Sharon Wright of the University of Stirling in a recent article, is that it can mean that large numbers of benefit recipients end up cycling or churning between unemployment and temporary low-paid jobs without advancement. Without the opportunity to train, lone parents face just such a future of low paid, insecure employment, cycling between in-work poverty and out-of-work benefits with little prospect of their financial or social circumstances improving. In our last session, we heard how they might then face in-work conditionality if they do not manage to improve their position to get themselves above the threshold which applies to them.
This amendment would go a small way to addressing the issue by ensuring that responsible parents, in particular lone parents, are better placed to advance in the jobs market and thereby lift themselves and their families out of poverty. I beg to move.
Baroness Meacher
My Lords, I support Amendment 51EA moved by the noble Baroness, Lady Lister. I was impressed when the Minister mentioned in an earlier debate that providers of support to claimants will be rewarded financially if their clients find a job and remain in it for two years. That claimants should achieve long-term employment is clearly the objective of the Minister and the Government. I have no doubt that it is a fine objective. Certainly it is supported by me and, I am sure, by other noble Lords around the table. However, this clause seems to run absolutely in the opposite direction. It encourages claimants with young children to rush into a low-paid and probably insecure job rather than taking the opportunity to train and prepare themselves for long-term work.
Will the Minister explain the rationale behind the lack of protection for carers responsible for very young children aged five or six while they complete a training course up to level 3? Does he see the apparent inconsistency between the aim of placing people in long-term employment, which we all support, and incentivising them to take low-paid work rather than educate and train themselves in order to better their future? I will be interested to hear what he says about that.
My second point is about the unreliability as an employee of a primary carer of children who are in the first two years of school. Having had four children, I have strong recollections of the childhood illnesses they pick up in the early years: for example, a cold, an infection or German measles. If you have four children, it is not one lot of German measles but four, one after the other. Employment? Forget it. This is a serious point. The strain of working when your young children are starting school and picking up all those bugs has to be experienced to be fully understood. In education and training, one can catch up when life settles down and the kids go back to school. I know because I did it. I did an economics degree when I had three children under seven.
We know that the Minister is under enormous pressure to deliver cuts through Parliament, but perhaps this issue is worth fighting for in terms of the Government's own admirable priorities of encouraging claimants to undertake training in order to improve their long-term employment prospects for the future.
Lord McKenzie of Luton
My Lords, I will speak briefly in support of the thrust of the amendment. It raises issues about the right age at which full conditionality should apply, and perhaps takes us back to debates we had on another Bill. Perhaps today is not the occasion to revisit them. However, I am not sure that we have debated thus far in the Bill the basic conditions for accessing universal credit. This is predicated on the fact that somebody is within the system and subject to full conditionality. This is what the amendment seeks to ameliorate. One basic condition for accessing universal credit is that somebody should not be receiving education. I presume that that is meant to cover broadly the same arrangements as exist under JSA. Perhaps the Minister will clarify that.
The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Freud)
My Lords, we recognise the value of further education and training. In England, the Department for Education is committed to fully funding education and training for all young people up to the age of 19. Everyone aged 19 and over is eligible for fully funded provision to achieve basic literacy and numeracy as a minimum to the equivalent of five GCSEs at grades A* to C. This is funded by the Department for Business, Innovation and Skills.
Higher education, as noble Lords will be well aware, is funded through a system of loans and grants intended to cover the cost not just of courses but of living expenses. Typically, the benefit system does not allow students in full-time education to claim benefits. That is in recognition that such individuals have access to other forms of financial support, either through the education system itself or because they are living at home with their parents. However, the existing system recognises that there are some circumstances where additional financial support is necessary. In particular, in income support, certain young people, for example, those who are estranged from their parents or lone parents with a child under seven, may be entitled to benefit while studying. Students who are themselves parents can also claim child tax credits.
Under universal credit, we are looking to maintain the status quo. I hope that that gives some reassurance to the noble Lord.
Baroness Hollis of Heigham
I am sorry to intervene so early, but unless I am badly out of date, there are two further circumstances in which you can continue to be on benefit while having education which have not been enumerated by the noble Lord. One of these is if you are a young person in FE and your FE contact hours are less than 16 hours a week and that is therefore thought not to impede your search for work, although your study time at home may be a multiple of that time. That is a key group, because most FE courses do not involve more than 16 hours a week of face-to-face contact, which therefore exempts quite a lot of the people my noble friend was talking about. The second exemption, as I recall, is that if you are more than halfway through a period of training—if it is an 18-week period of training and you have done at least nine sessions—you are allowed to continue even if you still receive JSA. Will the Minister confirm that those other two exemptions also apply to people on JSA or IS?
Lord Freud
Yes, my Lords, I am pleased to confirm that it is our intention to maintain those exemptions.
Baroness Hollis of Heigham
Forgive me. Would not the first of those neatly fit my noble friend's concerns?
Lord Freud
Yes, I am trying to drive to that point, if I am allowed to give the full picture. I was trying to do so formally so that it was on the record. I am trying to give a general level of reassurance. I am very sympathetic to the points that the noble Baronesses, Lady Lister and Lady Meacher, are making. I am not a “work first” devotee; I think that human capital is of value. In the work programme and the design of universal credit, we are trying to pull those two things, which have been very far apart in the system, back together. I understand the points being made and I am trying to describe how, in what is a difficult balancing act, we are trying to optimise the position.
Let me continue. As I was, I hope, reassuring noble Lords, we are aiming to maintain the status quo, and that includes carefully considering transitional protection for students currently entitled to claim income support as the age of the youngest child is brought down to five. Exceptions to the general rule will be set out in regulations in due course. Where a claimant is in full-time education and entitled to universal credit, they will fall into the group subject to no work-related requirements and, of course, not be required to search for or be available for work.
Beyond that group, we have made it clear that, in the absence of any other barriers, claimants with youngest children aged over five are expected to search for and be available for work. They can access any of the free training to which they may be eligible, but will need to fit that around compliance with the work-related requirements, so, typically, any training will be done part-time or through evening classes. I emphasise that they may be eligible for support with their childcare costs, because work and training are not mutually exclusive activities.
On the human capital point made by the noble Baroness, Lady Meacher, we are committed to improving skills at all levels. The new next steps service, the careers advice service and Jobcentre Plus are there to help people both in and out of work with their choices of jobs, careers and training. Funding for workplace training in England will be prioritised on small to medium-sized enterprises, to help employers with small workforces train lower-skilled staff.
Where training is required to address a skills gap that prevents an individual from entering work, work-related requirements will be adjusted or lifted as appropriate. This matches the current system in JSA, where claimants can be referred to qualifying full-time training to help them move into work, and are treated as having met work search and availability requirements. I hope that this makes our position clear, and on that basis I urge the noble Baroness to withdraw her amendment.
Baroness Meacher
May I interrupt the Minister for a second? He says that this will enable these people to get into work. Let us suppose that someone could take a job at a check-out in a Tesco store but was actually interested in trying to do better than that. Would that be acceptable or would they be expected to take the check-out job at Tesco? That is one of the issues.
Baroness Sherlock
I will focus on another point. Would the Minister mind answering the two points together? I am interested in trying to understand this. I have worked in the past with girls who got pregnant while they were in education, dropped out of school and were then eventually encouraged to get back to the stage where they could again get an education. The Minister has made clear his position on those who did not have basic literacy and those who might want to go to university or higher education. As I understood it from the amendment of my noble friend Lady Lister, we are talking about level 3: that is, A-levels or an international baccalaureate. I am not completely sure whether a young woman in that situation, who wanted to go back and get herself up to A-levels, would be allowed to do that or have to fit that around looking after children and a job as well.
Lord Boswell of Aynho
Further to that intervention, will the Minister also comment on the thought that occurs to me? It is that the test should be the value added from the education sought, at whatever level that happens to be.
Lord Freud
There is a lot of change going on in this area, as noble Lords will know. We are committed to picking up the recommendations of Professor Wolf, who wrote a stunningly important report—one of the best reports in this area that I have ever read. There are some principles in there about funding following the individual which have not been fully worked out. I am not discussing a static situation here. On the question of the check-out counter and fitting it around A-levels, as things currently stand the position is that the person would have to take the check-out job and fit the A-level around that. However—I hope that noble Lords can read between the lines—this situation has movement in it in the years to come, given what the Department for Education is determining to do around the Wolf report. I do not think that this is the last word on the matter but it is the last word as far as this Bill is concerned at this particular time.
Baroness Meacher
Would the Minister take this away and think about how to word the legislation here and at DWP in order to allow for flexibility in, one hopes, not too many years’ time in response to the education ministry?
Lord Freud
I will take that on board. This is a very important point. It is not one that I would cavalierly dismiss at all. How we raise human capital among people who have perhaps not had as good a start in life as we would want them to have is a central point. I will think about it and try to make sure that the way we design the structure will allow the flexibility to incorporate future developments. I am grateful for this particular amendment.
Baroness Hollis of Heigham
My Lords, I would like to add a further comment to the noble Lord’s open-mindedness on this, which is appreciated very much. A lot of research shows that work is the best form of training in the first 12 months or so at an entry point. If you roll forward, six or seven years down the line, those who have invested earlier in education at the expense of early access to work find they are able to float themselves off the bottom and get off universal credit. The key question is not whether the best education or training either follows or precedes work but over what time scale this is judged. All the research shows that, if you are patient enough and give it about six years, it is the amount of education you have had, rather than work-based training, that allows you to lift yourself off the benefit track.
Lord Freud
My Lords, we are getting into philosophy here. I accept the point and have always been uncomfortable with the “work first” philosophy. It worked in the short term, as the noble Baroness has said, but the evidence is that, in relative terms, we have a poor workforce because we have too many people with no skills and too few with intermediate skills by comparison with our main competitors. We have to think about the balance between “work first”—which does get people a job—and the risk that training is sometimes used as an excuse to do nothing. There is a difficult balance here. We have not got it right. We had a welfare-to-work system that got it completely wrong. We are trying to pull it together. I do not think that this is going to be a rapid process but everyone in this room knows that it is very important to get this right. It will take some years to get it right but we are beginning to travel in the right direction.
Baroness Lister of Burtersett
My Lords, I thank all the noble Lords who have spoken in support of this amendment and who have helped to push the Minister slightly further than he had intended to go when originally reading from his brief. I am pleased to know the Minister is not a “work first” devotee. I was going to say, “You could have fooled me”, but his response to the noble Baroness, Lady Meacher, has confirmed that is the case and I welcome the spirit in which the Minister has responded. Even I am beginning to pick up the ministerial nuances to understand that was a helpful response.
My noble friend Lady Hollis helpfully reminded the Committee of some of the exemptions that exist and it is helpful to have on record that those exemptions will continue. The noble Lord said that it is always possible to do training in the evening. If you are a lone mother, trying to bring up children, trying to do your job and support them in their education, and to keep them off the streets, is it realistic to think that you are also going to do training as well? It is asking too much of lone mothers when we already ask too much of them. We expect them to be responsible, in paid work, in education, keeping their kids off the street and so forth. I hope the noble Lord will come back at Report with some response to what the noble Baroness, Lady Meacher, suggested in terms of opening up the potential for the future in the flexibility of this clause.
The noble Baroness also raised a question about the context of government expenditure cuts. It is not clear that this is going to cost very much to extend beyond the exemptions that already exist for this group. It would be helpful to know what the cost would be of doing it now rather than at some future date. Perhaps the noble Lord could let the Committee know. I suspect it would not be very much at all. In the spirit of the human capital approach, I am not sure what the stumbling block is to doing it sooner rather than later. I beg leave to withdraw the amendment.
Lord McKenzie of Luton
“( ) With respect to claimants who have disabilities, the Secretary of State shall not impose any sanctions without first consulting a disability employment adviser.”
Lord McKenzie of Luton
My Lords, I beg to move Amendment 51FZB and speak to the other amendments in this group standing in my name and that of my noble friend Lady Hayter. I make it clear from the start that we accept the need for a sanctions regime to reinforce conditionality, but the issue, as ever, is the detail. These amendments cover four issues: the sanctions where a claimant is disabled; the amount of the sanction; the maximum length of a higher-level sanction; and targets. I wish to set this in context and seek to understand what is happening with regard to sanctions.
The Minister will be aware of earlier press reports which suggested that there had been a culture change in Jobcentre Plus, with a particular focus on tougher action on sanctions. Despite earlier denials by the Secretary of State, it was acknowledged by the DWP that instructions had been misinterpreted—a marvellous euphemism—and that there were no targets for staff to refer claimants for sanctions. A parliamentary Answer in May of this year elicited that from July to September 2010 there was a 42 per cent increase in the number of people sanctioned when compared with January to March 2010. Clearly, this is way in excess of any increase in the client caseload. Can the Minister please provide us with any more current data on what has happened since? If he cannot do that today, perhaps he will undertake to write to us. Will he give us an absolute assurance that targets for sanctions are not in operation, and that they will never feature in the world of the universal credit?
Moreover, what the earlier press report suggested, and, indeed, the DWP acknowledged, seemed to confirm that there may well be the prospect of creating a culture in which the emphasis on sanctions could prevail. So I ask, what is being done to ensure that this is not the case? Has the internal management reporting on sanctions changed in any way over this period? Although we should be cautious about interpreting press articles, a suggestion that vulnerable claimants could be tricked into falling foul of conditionality requirements, rather than supported in their work-related requirements, is at least cause for thought. I am aware that lots of training is undertaken in Jobcentre Plus but I am sure that the Minister will see the need to address these concerns. Perhaps he can summarise for us—I am sure that we have the data somewhere in the volumes of information that we have—the obligation on claimants to comply with conditionality requirements on an ongoing basis during the course of a sanction, whether it be higher, medium or lower level, and when such compliance mitigates the sanction. Is it only the lower level sanctions which can be terminated by re-engagement?
On the specifics of the amendment, the note circulated yesterday helpfully set out the answer to the question about the limit on sanctionable amounts. I thank the noble Lord for that. For claimants in receipt of the maximum amount, it will be fixed at the standard allowance amount. However, as set out in the note, for someone in receipt of income, that income has to be applied to support the housing and other elements before the standard allowance. The three-year sanction seems to be too long. It could mean that an individual is left only with their housing amount, and with housing benefit restrictions that might not meet even the rent level. That is not sustainable over a three-year period. The individual might have brought it on themselves, but how are they possibly to live? “Get a job” is not the answer if there are no jobs. With a one-year provision, as suggested in our amendment, we would be doubling the current JSA maximum in any event.
I acknowledge that our amendment requiring reference to a disability employment adviser before a disabled person is sanctioned might be more suited to Clause 27 than Clause 26 because the high-level sanctions are to apply only to those subjected to all work-related requirements. However, the points remain valid. If individuals are to have a big slice of their benefit removed for a period, it is important that they understand why; know what they have to do to comply with requirements; and be confident that the decision-makers understand the challenges they face continually or from time to time.
Finally, can the Minister confirm that the ability to sanction will not be contracted out to providers or to anyone else?
Lord Boswell of Aynho
I want to speak briefly to the amendments in the order in which the noble Lord, Lord McKenzie, raised them. First, I enter a note of reservation about Amendment 51FZB. I do so not out of a lack of concern for disable people but out of a concern not to red-line, identify them, or subject them to special treatment unless that is appropriate. We all understand that many jobseekers who are put on to the work search programmes may find life more difficult because they are disabled—that is not in question. The issue is whether the sanction, or the potential for one, in the event of misconduct—I refer to the high-level sanctions in Clause 26 rather than those in Clause 27—should ever be neglected. If a disabled participant on this programme were to reply to the department, “You can think again Charlie if you think I’m going to take that … job”, I am not sure that they should be treated differently from anyone in that position who happened not to have a disability.
On the other hand, if the disability were germane or material to explanations offered as to his inability to comply with the requirements in the section, it would be entirely unreasonable of the Minister or his decision-maker not to have regard to that. It might well be sensible to take the advice of a disability employment adviser, but I do not believe that we should create an artificial distinction about disabled people if the nature of their conduct is not related, or could be said not to be related, to their disability.
As regards Amendments 51ZC and 51FZD, I will rest on the Minister’s explanation for the periods he has chosen. As regards Amendment 51FB, I shall share with the Committee my view, expressed not for the first time, that I am not a particular fan of sanctions regimes. However, I am grateful to the noble Lord, Lord McKenzie, for admitting that there is a case for them and that they are necessary to support a conditionality regime, particularly where people are disinclined to undertake work, work experience or work preparation. We should not put too much by it and it will be interesting to hear the Minister’s response on how much this should be conditioned or targeted. At the back of my mind is the awful memory of the press reports in the first days of the Child Support Agency, alleging that the staff cheered when some delinquent absent parent had been identified. I am not sure that that is the right way to approach this issue; I believe that sanctions are better conducted more in sorrow than in anger, if I may put it that way.
I have one further question for the Minister. Before I ask it, though, perhaps I should say that, with respect to the noble Lord, Lord McKenzie, there might be a slight technical defect in the way that he has presented his Amendment 51FB; it bears on Clause 27 but it should bear also on Clause 26, unless there is some distinction in principle, and I shall comment on that. It would be helpful, for the benefit of those of us who have not been quite as assiduous as we should have been in attending the Committee, if the Minister could explain the difference between the two sanctions regimes in Clauses 26 and 27.
One further point is prompted by the fact that I know that, as I speak, our right honourable friend the Home Secretary is making a Statement and answering questions in another place on gangs and youth violence. We have recently had some press reports that there are to be further sanctions by way of withdrawing benefit from people who are behaving delinquently, whether by rioting or otherwise. I do not want to raise the question on that matter; I just seek this in clarification. I take it from my reading of these sanctions that these are specifically about the work programme and the conditionality thereon, and any such sanctions that the Government may decide upon would have to be delivered through another vehicle and either by additions to the Bill at some stage or by a separate piece of legislation. I would be grateful if the Minister could confirm that.
Essentially I am seeking clarification on some of the issues, expressing concern—as we feel our way through this Committee, which is our duty—about exactly how they would operate and a wish that we should at least not be unaware of any bigger and more major initiatives that may be coming down the track, although perhaps not on this particular set of clauses.
Baroness Thomas of Winchester
Is there a disability employment adviser in every Jobcentre Plus office? What training do disability employment advisers have? If the Minister does not know the answer now, which I am sure he does not—it is rather a detailed question—could he possibly write to me? A lot of us are concerned that disability employment advisers may not be quite as boned up as we think they should be on all sorts of conditions. I say that having been at a Jobcentre Plus office where I had to tell a disability employment adviser that the person in front of him had rheumatoid arthritis, when they were not an English speaker and they were describing their symptoms, and he had never heard of the condition. That rather shocked me, so I would be grateful for that information.
The Lord Bishop of Bath and Wells
My Lords, I enter the debate with a little trepidation. Like other Members of this Committee, I am sure, a number of letters have been sent to me and various cases put. I have had a particularly heart-rending one, running to several pages as so often these letters do, from someone who has fairly severe mental disabilities, according to the letter, and who has responsibilities at the same time, it seems, for a disabled mother. My understanding of the principle of conditionality at the moment in relation to unemployment benefit is that she could be penalised under this process. I would like some assurance that where severe disability is in place, as it were, we will be sure to safeguard the well-being of such people and that they should not be penalised in these circumstances.
Lord Freud
My Lords, currently when a single JSA claimant is sanctioned we stop payment of the entire benefit, which is usually around £67 a week. Under the universal credit, sanctions will reduce the award rather than stop payment. The amount of the reduction will be set with reference to the standard allowance.
Lord McKenzie of Luton
If the Minister will permit me, is that not simply because the housing component is added in as part of the universal credit? The sanction would not apply to housing benefit currently, it is the core standard amount which is equivalent to the JSA amount.
Lord Freud
Yes, the noble Lord has got it precisely right and I am grateful to him for summarising it for me. Where a claimant is in receipt of the maximum amount of universal credit, that universal credit will not be reduced below any amount included in their maximum amount for housing, children, disability and so forth. However, where a claimant is earning money and has other earnings over the disregard levels, the sanctionable amount will be a fixed amount not dependent on the level of the award. In circumstances where a claimant’s award is less than their maximum amount because of earnings, a sanction could reduce universal credit to less than the additional amounts for children and housing included in it. That, I hope, is obvious from the numerical examples I shared with noble Lords yesterday. Claimants’ other income will offset such reductions.
Fundamentally, the sanctions regime is designed to do what it does currently, albeit within the universal credit structure. We want to create a clearer and stronger system which provides clarity about the consequences of non-compliance and a more effective deterrent against repeated non-compliance. I can confirm to the noble Lord, Lord McKenzie, that the sanction regime and a sanction decision will not be contracted out. Clause 29, headed, “Delegation and contracting out”, does not include sanctions.
Clause 26 provides for higher-level sanctions of up to three years for claimants subject to all work-related requirements who fail to meet their most important requirements such as accepting a job offer. Failures sanctionable under Clause 26 clearly damage a claimant’s employment prospects and it is right that we have strong sanctions in place to deter such behaviour. Amendment 51FZD seeks to limit the duration of higher-level sanctions to one year. I can assure the Committee that we expect that three-year sanctions will apply only to a very small proportion of claimants who have repeatedly breached their most important requirements and where earlier sanctions have not worked to change behaviour.
Lord Boswell of Aynho
If there is repeat offending and therefore a series of sanctions is imposed, can that extend beyond the three-year period as one shades into another or is there a maximum term of three years?
Lord Freud
In the way it is structured, there is a maximum if you are on a particular level. It absorbs the other sanctions, if you like. As to why we have an escalating sanctions regime, the reason is very simple. The current sanctions regime is difficult for claimants to understand. It is important that there is a real escalation so that behaviour is changed. That is why we have created this structure, and why it is different. Also, as people see very evidently what the repercussions of not complying are, as they start to see the costs quite plainly, we do see a change in behaviour. That is why we expect only a small number of people actually to hit the higher level of sanctions.
Baroness Howe of Idlicote
I hope that the Minister will forgive me for interrupting. He has painted a very clear picture whereby only a handful of people are likely to be affected by this measure as they will learn the relevant lessons. However, will he make clear a route, as it were, to those administering the regulations or whatever, so that they do not push to impose higher sanctions too quickly and for a longer number of years?
Baroness Hollis of Heigham
May I add to that? I was going to wait until the Minister finished, but I wish to add two points which are germane to this discussion. First, the noble Lord is assuming—I absolutely understand why he would—that people respond rationally to sanctions. However, the group with whom he may well be dealing are those whose lives are feckless, chaotic and without much shape. In my experience, those people are semi-literate and probably do not understand what is going on when the sanction is imposed. It is just one of those things that happen to them in a passive way, which means that a high obligation is placed on staff, with the aid of easy-to-read literature and all the rest of it, to make very clear what is going on and what the nature of those sanctions are. My experience of people who have been sanctioned is that they do not know why they have been sanctioned.
Secondly—I was waiting to hear the noble Lord refer to this but he has not done so, so perhaps he will go on to do so, in which case I apologise for anticipating him—we have always had a hardship category in relation to sanctions. For example, if you have dependent children the level of sanctions is limited so that, because of your hardship, you are not sanctioned all the way. Disabled people and those with a mental health problem would in my view come into the category of vulnerable people entitled to a hardship adjustment so that their benefit is not completely wiped out. Again, this requires high levels of training and support from the very people who the noble Baroness, Lady Thomas, identified; namely, the disability employment advisers in Jobcentre Plus offices. Perhaps the noble Lord can reassure us on those two points. First, can he assume that people with such chaotic lives will understand the rationality of a sanctions system? Secondly, will the hardship regime apply to some of the people who were identified by previous contributors to this debate?
Lord Freud
My Lords, let me deal with the questions asked by the noble Baroness, Lady Hollis, straight away. Claimants who fail to meet their responsibilities will have an opportunity to explain why they have done so and show good reason before a decision to sanction is made. After a decision to reduce the claimant’s award amount is made and processed we expect that, as now, a letter will automatically be sent to claimants setting out their appeal rights and details of how to request information on why they have been sanctioned. We will also communicate the amount and duration of the award reduction and, in the case of lower-level failures, what the claimant can do to re-engage and bring the open-ended part of the sanction to an end. We will not sanction claimants with limited capability for work, or those who have learning difficulties or mental health conditions, without first making every effort to contact them, their carer or healthcare professional to ensure that they have fully understood the requirement placed on them and had no good reason for failing to meet it.
On hardship, we are addressing the hardship arrangements in a later group but we are looking to maintain a hardship regime which will act in a similar way, although we will probably make some adjustments to it. However, we can discuss that a little later. I should clarify the point about the overlapping of different sanctions. Where a claimant subject to one sanction receives another, both sanctions run concurrently with one reduction suppressed. This means that for the period in which two sanctions overlap, the second sanction has no impact, as I said earlier. Under universal credit, where a claimant subject to one sanction receives another, the period of the second sanction would be added to the total outstanding reduction period. A claimant’s award amounts would be reduced for the entire duration of both sanctions. This ensures that claimants will always face the full consequences of failing to meet their responsibilities. There will be a change from the current system to the universal credit system. I apologise if I slightly misled the Committee on that.
Amendment 51FZZA seeks to prevent the imposition of higher-level sanctions on disabled claimants until such time as a disability employment adviser has been consulted. First, I assure noble Lords that we recognise that high-level sanctions of up to three years are not appropriate for all failures. Disabled claimants with limited capability for work will not be subject to requirements that are sanctionable at the higher level. Clause 27 provides for appropriate sanctions for failures that should not be subject to high-level sanctions, such as failures to attend a work-focus interview or a training course.
Disability employment advisers play an important role. I will pick up on the point made by my noble friend Lady Thomas. I hope that my answer will get to the nub of her acute question. The role of disability employment advisers is to assist claimants with a disability or health condition who need extra support to gain or retain employment. It is decision-makers who will look at all the available evidence and consider whether a sanction should be imposed. It is right that we should retain the clarity of roles in the system. I will not talk about the training of disability employment advisers because it is not strictly relevant in this context. If the noble Baroness would like a letter describing it, I will write to her, but it is not the point here. What matters is the training of the decision-makers. They will receive in-depth training. This will include how to assess evidence and determine whether a claimant has demonstrated good reason. Where necessary, decision-makers may seek additional advice from specialists, including medical professionals, with the consent of claimants.
Lord Boswell of Aynho
As I read my noble friend, he is saying that if a decision-maker were considering the case of a person subject to a sanction, the representations made by that person about the problems they had in complying with their programme would automatically be taken into account, even if they were rejected on their merits by the decision-maker.
Lord Freud
I thank my noble friend for looking for clarity. There is a layer of protections here. We have a highly trained decision-maker with a specific job of making the decision. Also, the claimant can look for reconsideration within that office. Beyond that, they can look to reduce a sanction by going to an independent tribunal. There are layers of protection. The objective is that claimants who demonstrate good reason will not be sanctioned.
We will also maintain other protections. One is that we will continue to visit the homes of claimants with limited capability for work and a mental health condition or learning disability, to help us understand why they did not meet their requirement.
Baroness Howe of Idlicote
My Lords, I remain worried by the point that was raised about a basic understanding of what I call the coalface: in other words, when you are in a face-to-face situation. It is important to have some training and understanding, not least in the example that the Minister gave of a well known and common complaint. It worries me that this will be dealt with by experts at various levels of appeal rather than being sorted out much earlier in the process.
Lord Freud
My Lords, it is important that the coalface does not do the sanctioning. It is important that there are really well trained people doing this. This is a complicated area that needs to be got right. These are some of the most highly skilled people in Jobcentre Plus aiming to do that with all these supports.
In response to the concerns raised by the noble Lord, Lord McKenzie, on Amendment 51FB, I want to make it absolutely clear that there are no benchmarks and no targets for sanctions referrals. Jobcentre Plus gathers a range of management information to support its work, as you would expect us to do. On the issue of numbers, over the last year, the number of sanctions and disentitlements rose by around 270,000 from approximately 490,000 in 2009-10 to around 760,000 in 2010-11. There are a complex range of reasons for this increase, including the introduction of new requirements, a slight increase in the average claim duration and a refreshed approach to monitoring compliance with requirements designed to maximise claimants’ chances of finding work. A particular reason is due to the 2010 rule change that led to a sanction rather than disentitlement for failing to attend an employment interview. The number of sanction referrals to decision-makers is a key piece of management information. It helps local mangers assess how consistently JSA conditionality and sanctions are being administered in their area. Managers may compare rates of referrals across different areas when analysing the data, but there is no benchmark and certainly no right or wrong level of referrals. The collection of management information also allows the department to monitor and evaluate the impact of sanctions. I urge the noble Lord, Lord McKenzie, to withdraw the amendments.
Baroness Lister of Burtersett
My Lords, my attention may have strayed, but did the Minister answer the question of the noble Lord, Lord Boswell, about the reports over the weekend that fines deducted from benefits are going up to £25, which seems to be a draconian response in the context of the riots in which we read about it? Is this something that can be done by regulation, or will it be an amendment to this piece of legislation? It is an issue about which some of us are very concerned.
Lord Freud
My Lords, the press reports were about the level of deductions to pay fines and whether the current limit was right for people who had committed a crime and been fined. Although this is breaking news, this is not an area I am confident we will consider in this particular Bill because it is about fines. It is not a matter today that we will need to consider.
Baroness Sherlock
My Lords, I want to ask the Minister two questions. The first is related to the questions asked by my noble friend Lady Lister and the noble Lord, Lord Boswell. I remind the Committee that I am a member of the Communities and Victims Panel looking at the impact of the riots, although my question is not specifically about the riots.
On the question of fines, what account can be taken of any fines the claimant may be committed to paying when making a decision to sanction the benefit. For example, it may be the intention to only sanction or remove the standard element but if the household is already committed to paying fines, inevitably that is going to be taken out of elements that are intended for children or housing, so the effect will be to eat into those. Could the Minister explain how that will be taken into account?
The second question returns to what I think I heard him saying in response to my noble friend Lord McKenzie in relation to the final amendment in this group. I believe that he said there would be no targets or benchmarks for sanctions. Could he reassure the Committee a little further? Are there any targets, performance indicators, measures or benchmarks that would have the effect of incentivising an increase in the number of sanctions? I would be happy to repeat that if it would be helpful.
Baroness Sherlock
I am not sure I can, frankly, but maybe Hansard can. I talk too quickly even for myself sometimes.
The Minister was kind enough to say in response to my noble friend that there were no targets that were designed to incentivise an increase in the number of sanctions. Are there any targets, performance indicators, measures or benchmarks—he will know the language better—that would have the effect of creating an incentive to increase the number of sanctions? The Minister probably knows what I am getting at; one does not have to be directly incentivised to sanction people. If, for example, there were pressure on the department to reduce either the number of people claiming certain benefits or the cost of the programme element of the budget and therefore the cost of those benefits, one way to achieve that might be sanctions. I am not suggesting that they would do so but inevitably, once there are measures, someone responds. There might be other ways of doing that. Could he answer that for us?
Lord Freud
I shall deal with the second point from the noble Baroness, Lady Sherlock, first. The point that noble Lords are concerned about is whether we are going to have any more private traffic-warden incentive systems—that is the issue. That is why noble Lords are concerned that we do not incentivise people to “clamp” claimants. I make an absolute assurance that we understand how unacceptable that is or would be, and we are determined that there will be no incentivisation in Jobcentre Plus to sanction. We have trained our advisers—the decision-makers, rather—to make these decisions in as neutral and considered a way as possible, in the interests of changing the behaviour of the individuals to make them do something that in the end will be of benefit to them. Getting them into a job is vital, and we are keeping the regime of conditionality. I make that assurance to noble Lords.
On the noble Baroness’s second question—or rather the first one, if I learn to count—we are able to vary the rate of recovery depending on personal circumstances so we would be able to take that into account and, conversely, courts would be able to take that into account.
Lord McKenzie of Luton
My Lords, I thank the Minister for his detailed response. I am comforted—indeed, I recognise some of the script—about the protections that are in the system to support disabled people, people with mental health problems and particularly those with fluctuating conditions; that has been a long-running theme in our debates over a number of years. I accept that the disability employment advisers are not necessarily the right people to do this, for so long as there is capacity in the system, it is part of the process.
I also accept what the Minister says about no targets or any other incentives to encourage sanctions, but we are entitled to a better explanation of what I understood the figures to be: last year the number of people sanctioned was 490,000, while now it is 760,000. Something is happening out there, is it not? The schedule that I have, which was a Parliamentary Answer that looked at the 40 per cent increase over that period—March 2010 to September 2010—is headed “Sanctions and Disallowance Decisions”, so the switch between sanctions and disallowance that the Minister prayed in aid does not seem to have affected that outcome. It is, in anyone’s language, quite a dramatic increase. We should remain very worried about that. I accept the point that my amendment in relation to people with disabilities was focused on Clause 26 but it is within Clause 27 that their work-related activity falls.
Could the Minister also take us through the various sanctions and say in respect of each what happens to conditionality while the sanction is being applied? Is there an ongoing obligation to comply? What is the sanction if you do not? In what circumstances can those sanctions be switched off—and which of them can be—by re-engagement and rejoining conditionality by individuals? Particularly for the longer sanctions, if there were no obligation to engage in conditionality over that period, what ramifications would that have for, for example, on the job programme? Could the Minister let us have his views on that?
I was going to raise the issue of the £25 additional possible deduction in relation to the next amendment on hardship payments and may revisit that. The Minister made reference to people’s rights of reconsideration and appeal. How would he judge the impact of the impending changes to legal aid cuts, where there will no support to go to an independent tribunal because legal aid for help in welfare benefits is being removed entirely? What compensating arrangements are proposed to address that quite vital withdrawal?
Lord Freud
First, one of the drivers of the increase in sanctions was the introduction and phased roll-out first of the jobseeker’s regime and then of flexible New Deal. In one way, we are looking at the history of some of the changes made by the last Government. Secondly, conditionality still applies through the sanctions regime.
Next, the noble Lord asked for a breakdown of the different sanctions regimes. That is rather complicated. I can send him a table of that, rather than going through it in great detail. The summary is that the lower-level sanctions switch off on compliance. Those are one-week to three-week sanctions—rather short by comparison with the higher-level sanctions. Those are essentially grouped around the more vulnerable people. They take those and when they start to comply the sanction comes off and there is a short period. I should remind your Lordships that the table I suggested is sitting there in front of the noble Lord. It is beautiful that he is so far ahead of me. I will not go through that in entire detail. I remember that it took a long time to assemble that table. I spent a lot of time on it.
On legal aid, the point is that one does not need legal issues to be debated here with all the paraphernalia of a legal case. These are practical, fact-finding tribunals where, in our view, one does not need that paraphernalia. It is not particularly helpful.
Lord McKenzie of Luton
Will the noble Lord accept that people in those circumstances may need advocacy, which is being withdrawn?
Lord Freud
My Lords, they may need advocacy but they can find supporters and bring them along. However, it is not a legal process; it is a fact-finding process.
Baroness Hollis of Heigham
Did the noble Lord say that for somebody who was sanctioned, for example by the removal of benefit for three years, conditionality will still apply while the sanction operates? How will it apply if there are no benefits left to sanction?
Lord Freud
We would still expect them to comply with the conditionality regime.
Baroness Hollis of Heigham
That might be the expectation, but how would they be sanctioned?
Lord Freud
This is an extraordinarily small group. In extremes, we would look to run to more sanctions on top. I described how sanctions would work concurrently. We are looking at a sanctions regime that will replace the current regime, which states that people are not entitled to JSA because they are not complying at all with their conditions. In some ways it is a rather lighter regime than the current one.
Baroness Hollis of Heigham
Perhaps I could suggest to the Minister that the most successful use of sanctions is when there is a very close connection between behaviour, the sanction and the ability to lift the sanction by changing behaviour. I urge him to think again about running sanctions for very long periods and still expecting conditionality to apply. Frankly, that is in the clouds. If you are going to change behaviour, you need sanctions that will get switched off if there is compliance for a certain period of time. That is the way to get changes in behaviour to stick, which is what we all want. If it seems that nothing you can do can make any difference for at least two years, nothing will happen.
Lord Freud
My Lords, we are talking about a sanction that, to put it bluntly, is there as a deterrent. We are not anticipating that more than a handful of people will move into that position. One can get overinvolved in what it means. The point of having a regime that builds up is to act as a very powerful deterrent.
Baroness Hollis of Heigham
Will the noble Lord not accept the principle that if you want to change behaviour, you want that behaviour to have some positive effect—namely, to switch off the sanction?
Lord Freud
Clearly, I am interested in behaviour change. However, I would hope that before we get into these regions we will have had the behaviour change. There will have to have been a very bad failure in circumstances where we impose a three-year sanction.
Baroness Sherlock
Perhaps I may try to understand this. I apologise if I have not grasped it until now. Let us assume that someone has refused to co-operate and perhaps has a drug problem that has not been identified until this point. Something happens, possibly even as a result of the shock of the sanction, and they get themselves into a position where they are enabled finally to begin the process of engaging and searching. At that point, will the adviser simply stop the sanction and put them back into compliance? Even at its simplest, if somebody has no income they cannot look for a job, unless it is next door.
Lord Freud
My Lords, we are moving now into the area of ill health. That is where decision-makers come in and look very hard at what is happening. This is aimed at the person who has not got a mental health problem or a chronic illness. We are looking at someone who simply refuses to become part of the regime.
Baroness Sherlock
This is the last time that I shall intervene; I shall stop. I want to come back to a point raised initially by the right reverend Prelate: one of the problems, as I know the Minister understands, is that in areas of mental health a lot of problems are not diagnosed and are not necessarily known to be such problems. They can present as behavioural problems but in fact these have underlying causes that may, complete rationally, be wholly unknown to decision-makers and the person themselves may not be willing to disclose them. I am not expecting decision-makers to be able to know that in advance; I am more interested in how the system can deal with that if at some point this information surfaces. It may be that I have simply misunderstood the explanation that the Minister has given. I would be grateful if he could clarify it for me.
Baroness Lister of Burtersett
Is my noble friend’s point not that it is at the point where someone has said they will engage with the regime that you are more likely to achieve that outcome if you then withdraw the sanction? You have achieved your end but there is still a sanction. I do not think that the Minister has addressed that point.
Lord Boswell of Aynho
I am sorry for the Minister being put under, I think, unreasonable sanctions or pressure himself, but I suggest that it might be unwise to get into a situation either where we were softies and were not prepared to take these things seriously or where, in circumstances where someone had been sanctioned, if they were to get into the frame of mind of saying, “There is nothing to be lost; I shall carry on because it’s going to happen to me anyway”. There ought to be at least an opportunity for at least a negotiation on a restart of compliance.
Lord Freud
I think that I can give good news and bad news. There are two issues here. The first is the person who had a disguised problem which then emerges. We have a solution to that: if it emerges that there was good reason, the decision-maker can reverse the position. The bad news is that we do not have a position where, once someone recants, they are forgiven instantly.
Lord McKenzie of Luton
I thank my noble friends for raising additional issues, following on from our earlier debate. My noble friend Lady Hollis seems to have posed a fundamental question which, with respect, the Minister has not fully dealt with. The question was posed to be helpful to the Government, not to try to undermine what they are seeking to achieve.
To the noble Lord, Lord Boswell, I say that no one is talking about being a “softie” in all this. We are upfront; we recognise that sanctions have a role to play in reinforcing conditionality.
The issue about a small group of people who might be sanctioned for three years, with the withdrawal of their benefit unaffected whatever they do in terms of recanting, puts them in a desperate situation. It means that they will be further away from the workplace. I do not know whether they can volunteer or would be involved in the work programme—these are issues that we can pick up in due course—but I urge the Minister to reconsider around this issue because there is something that could benefit the Government in what they are trying to achieve.
Having said that to the Minister and suggested that he might frame his diagram and put it alongside the Pensions Bill that he got last night, I beg leave to withdraw the amendment.
Lord McKenzie of Luton
Lord McKenzie of Luton
My Lords, this is a probing amendment in respect of hardship payments generally and issues around recoverability in particular. The draft regulations that have been provided to us indicate that hardship payments will be made where a universal credit payment has been sanctioned but where the award has been reduced below a certain level and the claimant can demonstrate that they are or will be in hardship as a consequence of the sanction. It is understood that the regulations will broadly replicate existing JSA regulations. Claimants will be required to continue to meet work-related requirements.
Under existing JSA arrangements, a person can qualify for hardship payments at the beginning of a period of a claim if a decision about eligibility is awaited. Will similar arrangements operate for universal credit? What happens where there is a couple claim but the couple splits up? Does the unrecovered amount attach to the claimant who was sanctioned? Further, when will recovery actually start?
I should have said that there is a key difference between the arrangements proposed for universal credit and the existing JSA regime in the plan to recover hardship payments from some claimants. The notes suggest that this will include everyone who is not in the “vulnerable” category. Is this still the intention? The Minister will be aware of the deep concern that this prospect has raised. It is planned that recovery will be based on existing legislation relating to the recovery of overpayments and payments on account. Will the Minister explain what these are? Using the model for recovery for those who have been overpaid for those who have been in receipt of just 60 per cent of the amount of the sanction reduction does not seem innately to fit well. Over what period or at what rate will the hardship payments be recovered? What if the recoveries themselves push claimants into hardship?
I shall repeat a question I put a moment ago. What happens where there is a couple-claim and the couple split up? Does the unrecovered amount attach to the claimant who was sanctioned? When will recoveries actually start—while the claimant is still in receipt of the hardship payment or after benefit is restored?
The Minister will recognise that to qualify for hardship payments, claimants have to be just that: in hardship, a few steps away from destitution. The Minister may well say that that would be of their own making, but we should not overlook the chaotic lives some people live, compounded for some by mental health and other fluctuating conditions. Too many claimants exist at the very margins of financial solvency, and recovering hardship payments could tip them over the edge.
I want to pick up on a point made by my noble friend Lady Sherlock a moment ago about the announcement of the increase in the amounts which can be recovered for fines to £25. What will be the relative claim in respect of these payments? Will the hardship payment recovery take precedence over these other amounts, and how will that be sorted out? Will the recovery of hardship payments reflect other deductions which are already being taken from benefits? I beg to move.
Lord Kirkwood of Kirkhope
My Lords, I am trying hard to say nothing from this end of the table because it is important to make progress. However, I too am very worried about the press reports that have coming since the summer. I said at the beginning of our first session in Committee that some of the language that was being used in relation to these issues and to benefit deductions was extremely worrying. It is getting more acute and more refined. I do not think the Minister can hide behind the defence that he tried to use, although it is absolutely accurate. Changes of this kind would come under the powers given to the courts because these things will be decided in court. But the latest BBC newswire I have seen on this issue described the Prime Minister, David Cameron, talking about benefit reductions for fines up to a maximum of £25 under universal credit. That came from a BBC report. If the Prime Minister has it in his heart and head that universal credit is going to be subject to what I calculate to be a 37 per cent reduction in the standard allowance, I do not think it is fair for this Committee, or indeed the House, to go through all these legislative proceedings, pass this Bill and give it Royal Assent, without some consideration of exactly what that means.
Now I have two complaints. First, as I said in the first day in Committee, a particular language is being used. The Prime Minister talked about the current maximum deduction of £5 as “much too soft”. Indeed, the Secretary of State is not absolved from some of these phrases which really target people on benefits. Of course, we are talking about people in the courts and who have committed crimes. We may even be talking about people who took part in riots—I am not sure about that. That has to be borne in mind and taken into consideration, but to remove up to 25 per cent of £67.50—the level that I understand is being set for the introduction of universal credit in 2013—is a massive reduction for anyone to contemplate. It will simply push people to the margins.
Secondly, what kind of benefits are we talking about? Are claimants to include state retirement pensioners who may find themselves in the courts? Are they contributory benefit claimants who may well have been paying in for all their lives to get that access? Under this new regime, are they likely to be subjected to a £25 benefit deduction? It is not sensible for the Committee or House to contemplate going into universal credit against the background of this being possible without serious consideration of what it is, in detail, that is in the mind of the Prime Minister or Secretary of State. I completely absolve the Minister of any of this stuff, but he must understand that it causes serious concern to people. I guess that this could be introduced by a change in regulations, late at night on a wet Thursday. Unless I get some pretty compelling, better evidence about the provenance of this idea, I will be there, wet on a Thursday, waiting for him. It is unimaginable that we should just pass these things willy-nilly because these benefit claimants riot and need 37 per cent of their entitlement reduced. It is unconscionable and we need a better explanation than the one we have at the moment.
Baroness Meacher
I rise very briefly to add my support to this. Many years ago, I wrote a book about the withdrawal of benefits after four weeks from people who had been in difficulty. The book clearly showed that 90 per cent of them or more went straight into more crime. This is just another obvious, simple situation where that is all that the Government will do. I know that the Minister will not wish that to happen. I plead for him to take this away and think about it.
Lord Freud
We are looking carefully at the system of hardship payments we want to put in place under universal credit. We want to ensure that there remains a financial safety net for claimants who have been sanctioned—that is what hardship payments are about. However, we want to avoid the existence of such a safety net undermining the deterrent effect of sanctions. It is clearly a rather delicate balancing act. I should make the point that, under universal credit, hardship is only available following a sanction, not at the start of a claim. It will no longer be necessary within the structure of universal credit. We are looking at a payment for people who have been sanctioned.
We are still considering how best to achieve this but believe that the ability to make some payments recoverable is one way of continuing to support those most in need while ensuring hardship payments are not seen as a simple replacement for sanctioned benefit. In other words, we want to make sure that sanctions continue to keep having an impact. We are still considering our approach to recovery that will ensure adequate safeguards are in place. This includes the arrangements in more complex situations of the kind the noble Lord, Lord McKenzie, pointed out, such as when a couple has separated. Regrettably, I can not give hard answers to his, as usual, specific and beautifully placed questions. Those are issues that we need to address and are addressing.
Baroness Hollis of Heigham
My Lords, could I press the Minister on this? I was struck by his version of what a hardship payment was for and his concern that it should not moderate the effect of sanctions. He thought this was a tightrope to walk. That is not my understanding of what hardship payments are about at all. What hardship payments are about, certainly when dealing with lone parents with children, is to ensure that the sanction does not fall on the innocent—children for example.
The Deputy Chairman of Committees (The Countess of Mar)
I am sorry to interrupt the noble Baroness. There is a Division in the House. I suggest that those who have not said they are unable to go downstairs return at 5.14 pm precisely.
The Deputy Chairman of Committees
My Lords, I think that the principals are here, so can we return to the Bill? Does the noble Baroness, Lady Hollis, wish to continue?
Lord Freud
At the risk of being a little repetitious, I will try to summarise. Obviously, hardship payments are there to ensure that claimants and their dependants are not left in hardship as a consequence of a sanction. We do not want the existence of those payments to make people feel that they can ignore their responsibilities. That is why we are looking at what reform we can make to the current system. We will continue to provide the safety net for claimants and their children.
Lord McKenzie of Luton
My Lords, I welcome the Minister's response. I think it indicates some going slow on the issue, and that is the right course of action. The Minister said that there had to be a financial safety net for individuals. I certainly agree with that. If the financial safety net is 60 per cent of the basic amount, just under £40, I suggest that there is really no room to pursue any repayments of the hardship payment. The noble Lord's assertion that they would not start until after the sanction period had ended is to be welcomed, but that rather reinforces the point made by the noble Lord, Lord Kirkwood. It is all very well for the Prime Minister out in Australia to make great pronouncements about docking £25 from people's benefits. That is another example—we see too much of it from some members of this Government; although I certainly do not include the noble Lord in this—of using those sort of issues to get headlines and to berate people on benefits. That is deeply unpalatable.
Lord Freud
I cannot let the Prime Minister go undefended. He was emphasising the fact that unless a financial penalty for a crime actually hurts the person and has the impact of a punishment, it is not doing its job. He is concerned that the very modest rate of £5 a week is hardly an impact. Although I glow with delight at the separation that the noble Lord is trying to put between me and notional hard statements, I must say that the Prime Minister is clearly right in this matter.
Lord McKenzie of Luton
The noble Lord is secure in his position but, to be honest, he is anyway, given all the good work that he has done on the universal credit. Five pounds may not seem very much, but if, because you have been sanctioned, you are down to 40 quid a week or less, £5 will be very difficult to find; £25 impossible. We ought to have this debate at a much more mature level. Having said that, I beg leave to withdraw the amendment.
Lord Kennedy of Southwark
Lord Kennedy of Southwark
My Lords, when I spoke at Second Reading, one point that I made was my deep concern that there could be considerable problems, considerable hardship caused to people if changes were made that were not thought through properly. Many noble Lords who spoke at Second Reading and who have spoken during Grand Committee have been clear about their support for the principle of universal credit, and I am one of them.
The noble Lord, Lord Freud, will be aware that I have asked a number of Written Questions on these matters. My amendments in this group are intended to ensure that there is some form of piloting of the proposals, so that we can assess their effect and make informed decisions having looked at the reality of what is happening on the ground.
I still have considerable concerns, but I was very pleased to see, first, the Minister himself opposing the question that Clause 30 stand part of the Bill and then the amendments he has tabled; Amendments 56A and 69A. It would be very sensible if we moved on to consider those and probed the Minister's proposals in this group. They are a welcome step in the right direction. I thank him for that and I am very pleased. They may need further refinement, and I am sure that we will have more to say about that in Grand Committee and at Report on the Floor of the House.
I leave it there with a view to quickly getting on to the Minister’s proposals. I am sure that that is what the Grand Committee wants. I beg to move.
Lord Freud
My Lords, we will ensure that the full universal credit system is extensively tested with claimants before the new benefit is introduced. However, this will not take the form of a pilot scheme as this would add extra costs and delays to the introduction of universal credit. It is vital that we are able continuously to test, improve and evolve the universal credit system after it is introduced. It is key element that we should have the flexibility to respond to change and ensure that the system does not stagnate while the world develops around it. The amendments I tabled will achieve this constant evolution.
The original wording of Clause 30 provided for piloting measures only to see if they would improve a claimant's chances of entering work, or of finding more or better-paid work. While this is a key objective, universal credit will also simplify the benefits system, improve work incentives and change behaviour. Amendments 56A and 69A will ensure that we are able to test approaches that cover these wider principles.
If we are to ensure that we have the flexibility to develop and continuously improve universal credit, we must ensure that piloting can also include the testing of changes to the structure, design and delivery of the benefit. The ability to run controlled pilots of tests—for example, of whether advances in technology could improve the structure or delivery of universal credit—will be a fundamental part of the evolution of the benefit and of its ability to remain responsive to claimants' needs.
I will add that the inspiration for this measure came from thinking about what happened to NHS hospitals when they were brought into state control in 1948. Their service levels were almost frozen. It is vital, with a big state system, constantly to move, change and evolve it. This is the mechanism to ensure that we have a responsive system. If we do not have this kind of power, we could find ourselves with a system that is perfectly in tune with what we require in 2011 but by 2030 is absolutely out of touch with what society needs.
I recognise that any pilot must be transparent and timely, which is why the clause includes a number of safeguards. For example, we have time-limited each future pilot scheme to three years. Through Amendment 69A we will ensure that any pilot regulations will be subject to the affirmative resolution procedure. I hope that noble Lords on all sides will support this enthusiastically, and I urge the noble Lord to withdraw his amendment.
Lord Boswell of Aynho
My Lords, I warmly support the arguments of the Minister. Might I have an assurance from him that as the past record of the department—no names, no pack drill: I suspect that it is a political sharing of honours, or dishonours—shows that it has sometimes anticipated the results of pilots by introducing substantive schemes before their conclusion, he will at least start with the working assumption that the pilot will come first, then the evidence, and the decision thereafter?
Baroness Hollis of Heigham
Like other noble Lords, I very much welcome this. The problem in the past has always been the length of time to get a learning loop into systems. By the time there has been a pilot and the evidence has been assessed and reported back, three years have passed—by which time, alas, usually incumbents have moved on and questions have changed. I am delighted that we will get pilots. Will the Minister give an undertaking that the results of the pilots will be published and made available to Members of both Houses as soon as is practicable? Sometimes they will not be supportive of positions that the Government wish to develop. However, at the core of research must be the integrity of publication.
Baroness Hayter of Kentish Town
My Lords, the Committee will know that my noble friend Lord McKenzie and I have added our names to this amendment, but we are delighted that it has been overtaken by the Minister’s own amendments. I am getting a bit of a record for doing this. Last night I commended the Government on their move on the Housing Ombudsman, and I am doing the same today. However, I have a couple of questions. Whether this is to be piloting or testing throws up exactly what I wanted to ask: what is the purpose of each of these pilots? Are they to test whether the principle of a particular part of the Bill is right—in other words, that the aim of each part of the Bill is being met—or are they simply to determine how best to implement each proposal?
We always welcome piloting and testing of whatever it may be, but the exact purpose of a pilot needs to be absolutely clear at the start, particularly for those who have to design and implement it, as well as for all the participants and evaluators. What is the pilot meant to achieve, and therefore how should it be monitored and evaluated? That is because whether it is simply to find the best way of making something happen or to see if the idea behind it is right is quite an important distinction.
We hope that the Government will be confident enough not to assume automatically that what they think will work, will work—whether to incentivise people or to simplify systems—and that they will use these pilots in order to test the assumptions underpinning particular proposals in the Bill. That means being confident enough to design the pilots accordingly to see whether the particular objectives behind the proposals in what will by then be the Act are being met. That is asking quite a lot of a Government. We are saying, “Are you confident enough and in a sense big enough to be able to call it a day if the end results of any particular pilot call for a big re-engineering?”. I believe that pilots of this sort will be worth their weight in gold to the Government in financial and administrative terms and to claimants, landlords, employers, carers and providers, all of whom are going to be affected by different parts of the legislation. The pilots can play a role in creating the sort of welfare system that is able to meet the demands made of it. We would ask the Government to be as adventurous as they can with these pilots by putting the difficult questions. Also, following up on what my noble friend Lady Hollis said, the results should be transparent.
Who is going to oversee the design and delivery of the pilots? Who will decide, under subsection (5)(b) of the proposed new clause, that pilots may be replaced or extended, and on what grounds? To whom will the evaluators report? That is more or less the same question as that posed by my noble friend Lady Hollis. How will Parliament be able to ensure that the lessons from such pilots are learnt?
Lord Freud
I thank noble Lords for their support. At this stage we are taking legislative powers in order to be able to do this. How it is done is something that we will actively develop. I will tell noble Lords what I think we should be doing without necessarily locking down that that is to be the process, because we have not developed it.
Universal credit is the most amazing social science laboratory that I suspect we have ever seen, and I wonder how many other people will see it. Under universal credit you can change different aspects of people’s support.
As such, it needs a unit built in which is constantly looking at how to improve it and optimise it or to adapt it to different circumstances. I anticipate, in answer to the question from the noble Baroness, Lady Hayter, that we would have a series of real questions. Many of the questions raised by noble Lords in the Committee—should we have a second earner disregard; should we have a lower taper; what happens when you move disregards up or down?—are real, basic questions. They are all being put in the form of amendments, but here, we can have a series of tests of different aspects, or tests in combination, to find out what really optimises the system. Clearly, it is impossible to get it absolutely right first time. No one would claim to do that, but this is an architecture which would allow us to optimise it.
The Deputy Chairman of Committees
My Lords, there is another Division in the House. The Committee will report back at 17:43 precisely.
The Deputy Chairman of Committees
My Lords, I think that all the important people are back.
Lord Freud
I think that I had completed everything I need to say about these piloting powers and ask the noble Lord to withdraw his amendment.
Lord Kennedy of Southwark
I thank the Minister for his response. As he says, it is important that we are able to respond to changed situations—that certainly is progress—but we still have some way to go. I agree with the comments made by my noble friends Lady Hollis and Lady Hayter, and by the noble Lord, Lord Boswell. The integrity and transparency of the process is paramount. As noble Lords have said, it is possible that what comes back will not support the aims or proposals of the Government. With that, I beg leave to withdraw the amendment.
Baroness Lister of Burtersett
I will just stay standing until my noble friend Lady Howe is here to move her amendment.
Baroness Hollis of Heigham
Perhaps we can ask the Deputy Chairman of Committees to inform the usual channels that it is not possible for us to get down to vote and back up again given the queues of people voting, as well as make oneself comfortable, in 10 minutes. I wonder whether we could ask, through the usual channels, whether 15 minutes might be more acceptable.
Amendment 52B
Baroness Howe of Idlicote
Baroness Howe of Idlicote
My Lords, I am delighted to have actually made it. With regard to the previous amendment and the proposal for pilots, it may well be that pilots are relevant here, too.
This amendment would introduce a specific earnings disregard within the universal credit to ensure that carers juggling work and care are not left worse off as a result of the new system of disregards. Approximately 250,000 carers currently in receipt of the carer premium to means-tested benefits such as income support, will be moved to universal credit. Under that, the earnings taper will be more generous than the withdrawal rate of existing benefits. Many claimants who are in work, including many carers able to juggle work and care, will be able to keep more of their benefits as they earn. However, this will depend on which earnings disregard they have access to and their level of earning.
Under existing plans, it appears that certain groups of carers would see the size of their earnings disregard in universal credit reduced, compared to their existing income support disregard. Currently, individuals in receipt of income support are eligible for a £20 a week earnings disregard, that is £1,040 a year, which allows them to earn £20 a week before their benefits start to be withdrawn. The Government have announced the following disregard groups for universal credit claimants, with approximate disregard levels: for a single person without children it is £700, about £13.50 a week; for a couple it is £1,920; for a lone parent £2,260 plus £520 for the first child and £260 for the second and third children; and for single disabled people or a couple where at least one person is disabled it is £2,080.
The Government have said that, taken together with the taper, this would leave couples, singles, lone parents and disabled people significantly better off in low-paying jobs. That is good as far as it goes. However, it does not apply to single carers, who currently have access to £20 income support through receipt of the carer premium, but who would be able to access only a basic single person disregard of about £13.50 a week under universal credit. Although £13.50 would be an improvement for unemployed single people being moved onto universal credit from jobseeker’s allowance, where they currently receive only £5 a week disregard, it would see the earnings disregard for single carers on income support drop from £20 a week, that is £1,040 a year, to £13.50 a week, or £700 a year.
Those carers who would see their disregard reduced would be those unable to access the higher disregards for couples, lone parents and those with children or covered by a disability disregard. Carers losing out would be those living on their own, who do not have children and who are caring for a disabled person who does not fall within their universal credit household. This latter group includes carers looking after a disabled or elderly friend or relative living elsewhere and carers looking after an adult disabled child, a parent or other elderly relative living with them but who is not considered to be within the same household for the purpose of universal credit.
The Government have estimated that around 20 per cent of households that receive means-tested benefits and include a carer would not have access to any of the higher disregards for couples, lone parents or households that include a disabled person. With approximately 250,000 carers on means-tested benefits, this would leave approximately 50,000 carers able to access only the lowest earnings disregard if they were able to juggle work and care.
I end with a case study to put this in perspective. Sheila is on income support and cares for her mother, who is 58, has early-onset dementia and receives disability living allowance. Sheila is single and has reduced her working hours as a librarian to just two hours a week. She currently earns £20 a week and, because of the existing £20 disregard, her benefits are unaffected. Under universal credit she would be eligible only for a single person's earnings disregard of £700 a year—around £13.50 a week. Sheila's earnings above £13.50 would be subject to the universal credit taper, which would mean that she would be £15.75 better off from her £20 earnings. She would be £4.25 a week—£221 a year—worse off than under the current system even though she would be earning the same amount.
I will not go on to outline the full impact because I have given an impression of what it would be. I look forward to hearing how this unfairness can be tackled. I beg to move.
Baroness Lister of Burtersett
My Lords, I am pleased to support the amendment moved by the noble Baroness, Lady Howe of Idlicote. I am glad that she was able to get to her place in time. I welcome the fact that a single person's disregard was included in the latest round of announcements about universal credit. I also welcome the more generous disregards being made available for most recipients.
I have banged on for many years about the importance of disregards. For me, this is one of the plus signs of universal credit. However, the interaction with housing costs and the complexities that will be created have qualified my enthusiasm for the new disregard regime. It sullies the supposed simplicity of universal credit. I came across some of my noble friends one evening last week wandering around in a state of utter confusion, trying to understand various calculations that we had been given on disregards. I should add that these noble friends are extremely expert.
Just how complex the calculations are was brought home to me by Sue Royston of Citizens Advice, who kindly e-mailed me to point out the implications for carers. I will read out what she said because if I try to paraphrase it I could get in a hopeless mess and get it all wrong. She wrote:
“The proposed levels of disregards have added a whole new area of complexity ... The new disregards have given single adults a disregard floor of £13.50. I have assumed in the calculations that CTB will pay council tax in full for those on JSA or ESA levels and that any excess earnings will be clawed back at a 65% taper as I would be very surprised if any Local Authorities were more generous than this. For the first £13.50 a single claimant will not be subject to a taper of UC but will be subject to a CTB taper so will gain 35% of their earnings. However, every £10 they earn beyond that will be subject to a taper of 35 per cent from universal credit and will then be subject to a further taper in council tax benefit, leaving them with a gain of £1.22 for every £10 they earn … a single carer who at the moment can simply earn £20 and keep all £20 as well as their benefits in full will now have to earn over £55 even to get a £10 gain if they pay council tax at £18. When someone is no longer subject to the combined taper will depend on the amount of council tax they are responsible for paying”.
She goes on to observe that:
“People will have to go through complex calculations to work out given extra costs of working, what level of hours they can afford to work and how much they will gain at different levels of income”.
I hope that I have not lost noble Lords in that, but if I have, it makes the point that this is extremely complicated. If we cannot understand it, how do we expect recipients and carers who are trying to juggle work and care to do so?
Juggling work and care is no easy matter. I have not had to do it myself, but anyone who has done so or with relatives who have knows that it is difficult and stressful. According to Ipsos MORI research commissioned by Carers UK and the DWP for Carers Rights Day 2009, about one in six carers had given up work or reduced their working hours in order to care. A major barrier is the availability of suitable replacement care. In a separate survey and research by Carers UK and the University of Leeds, over 40 per cent of carers who gave up work did so due to a lack of sufficiently reliable or flexible services. A similar percentage, 41 per cent of those surveyed, said that they would rather be in paid work, but that the services available do not make a job possible. I am not saying that a disregard will magically create these services, but it would certainly help to pay for the things needed to support the combining of paid work and care. We know the arguments around childcare, but we seem to forget them when we talk about other forms of care.
There is evidence about the stress and ill-health suffered by carers who do this juggling act, and of course we are talking about more women than men here. That is because while,
“women represent 58% of all carers, they make up 73% of carers on benefits. They are substantially less likely to be in work. One third of heavy-end male carers are in full-time work, but only 13% of heavy-end female carers are working full time”.
I, too, will end with a case study which I have been given by Carers UK, and I have a couple of questions.
“Cheryl is 45 and lives in Stoke on Trent—she has been her elderly father’s full time carer since her mother died in 2008. Spinal problems, a heart condition and arthritis mean her father needs full time care so he has come to live with Cheryl, her husband and their 5 year old son. Alongside providing childcare and supporting her father with everything including eating and personal care, Cheryl works for an hour on three evenings each week as an NHS cleaner, once her husband is home from work and can support her Dad and son. The only social care support she gets is six hours of respite care each Monday—time she uses to do food shopping and spend some time with her son who she hardly sees in the evenings. She wants to work more”—
clearly she has the same philosophy as the Government in that she believes in paid work—
“but has no one else to look after her Dad, can’t afford replacement childcare and would have to find a different or second job as her current employer is not able to give her more hours. Any work has to fit around her son’s school hours, school holidays, her husband’s working hours and his ability to provide childcare and her father frequent doctors, physio and hospital appointments during the day”.
That gives a flavour of how difficult life can be for carers. As I have said, a more generous disregard is not a magic wand, but it could ease that life and it is a way for the Government to say, “We recognise that the position of carers is different from that of other single adults”. It has been recognised in the past that there is a case for a higher disregard for carers.
Can the Minister explain why carers appear to be the only group whose earnings disregard will be reduced as they move on to universal credit? Not surprisingly, there is a feeling that that is discriminating against carers. Secondly, what assessment has been made of the impact on carers and particularly on their work incentives?
Baroness Hollis of Heigham
I would like to add to the questions that we will be showering the Minister with on this issue. We are dealing with the issues of caring and what recognition there is in the benefits system for that, of work conditionality—which, from what I have heard, worries me very much, so we will certainly be returning to that—and of disregard.
As the Minister will be more aware than all of us, at the moment if you do not care for one single person for more than 36 hours a week you do not get carer’s allowance. This could mean that you are caring for two people, each for 25 hours a week—his mum and your dad, for example—making 50 hours a week, but you are not entitled to carer’s allowance. At the moment, therefore, if you do not have a husband’s income to float you off it, you are probably on income support and you will indeed get the £20 disregard. As I understand it, and perhaps the Minister can confirm my worst fears, that person, who might be in their 50s and caring for 50 hours a week as a single person, would have full conditionality applied to them because they were not getting the carer’s allowance so they would be expected to work 30 hours plus, on top of the 50 hours’ care. On top of that, they would not get any earnings disregard. Will the Minister confirm that that scenario is possible?
Baroness Thomas of Winchester
My Lords, I shall speak to Amendment 52BD in this group, about disabled claimants. If the noble Baroness, Lady Lister, thought that her brief was complex, this is pretty complex too. At the moment, if a disabled person is in work they can claim the disability element of working tax credit if they fulfil two tests: a work disadvantage test and the benefit test. The work disadvantage test includes many criteria, but one of the most common ways to qualify is if you are unable to work full-time because of a health condition or impairment. You also have to fulfil the benefit test if you receive DLA or attendance allowance or you have been receiving sickness benefit for at least the previous six months.
There are other qualifying criteria that would take all afternoon to go through for both the work disadvantage test and the benefit test. An example of the work disadvantage test criteria is that you cannot extend your arm sufficiently to shake hands with another person without difficulty, which sounded rather French to me. Suffice to say that the criteria for qualifying for the disability element can be complex but probably covers a lot of disabled working people.
Under the universal credit, many disabled people will not receive extra help because the gateway to extra support is through the work capability assessment. So someone will not qualify for the disability disregard if they have been found fit for work. For disabled people who are already in work, a new test will be designed and we are hoping that that new test will have some lower criteria in it.
Some of the criteria for the work disadvantage test look similar to the criteria for the WCA, but it is unclear what the qualifying criteria will be for this test for disablement under the universal credit, as I have said. If everyone else is giving examples, I might give the example of someone who might benefit now from extra help but might not qualify in future. I am afraid I have not given her a name but she is a person with MS who can walk up to 100 metres but gets tired very quickly and is unable to cook a meal for herself. She may now qualify for DLA lower-rate care and might also receive the disability element of working tax credit, if she were able to work only part-time because of fatigue levels. This person probably will not qualify for the personal independence payment, although until we see the new criteria, which we were told would be available at the end of October, we cannot tell. This person probably will not qualify for any more help under the universal credit than a person who is not disabled.
Another of the worrying things about the loss of this extra help for many disabled people under universal credit is the passporting factor used by local authorities for travel passes, leisure passes and so on, so disabled people may lose out on a much wider scale than may at first seem apparent. I look forward to hearing what my noble friend has to tell us about that.
Baroness Meacher
My Lords, I support some of the concerns that have already been raised by other noble Lords. I am not clear about the logic of ending the provision for adding disregards if a claimant falls within two categories, both of which qualify for a disregard. As I have always understood disregards, the idea is that they compensate for the costs that a claimant faces, whether those costs arise from being a lone parent, being disabled or whatever. I am sure that the Minister has a rationale for the measure but it is difficult to think what it could be. Is he going to provide a disregard for the disability side, the lone parent side or some other side? Why provide it for this bit rather than that bit? Why not provide the disregard for both sets of additional costs? It would be interesting to hear his rationale for this measure.
Given that the Government want to make swingeing cuts to the welfare bill, I completely understand that two-earner households are not a priority from that perspective. However, going back to the Government’s commitment to having incentives to work, this is another example of a part of this legislation running completely counter to that aim. I know that the Minister will correct me if I am wrong, but as I understand it the second earner will have almost no incentive to work, particularly if they have children, as they will not have the earnings disregard but they will have to pay the 30 per cent or so costs of childcare. This will almost certainly be the case if they have children. Therefore, it would be helpful if the Minister agreed with me that this is a bit of a problem in terms of incentives to work or explained the rationale behind the measure.
Regarding people with mental health problems, I envisage—I think that the Minister agrees with this—that this group will lose overwhelmingly from the shift to the new system and the reassessments for ESA. Rafts of these people will come off ESA and on to JSA with the result that, even with a disability, they will not receive any disability support because they will be on JSA. Yet people with mental health problems can have additional costs in order to go to work that others might not have. For example, somebody with severe anxiety might have to have someone accompany them on their journey to and from work, although they may be able to sit there and do the job when they get there. However, if they get no financial support at all for their disability—I understand that that is what the system sets out—how will these people have an incentive to work? They will have to pay for this support out of their tiny pockets.
The other point about people with mental health problems is that many of them can manage only a limited number of hours of work and need to build up their hours slowly. I do not know how this will work. The structure of the universal benefit is very good in this regard and should make life easier for people—at least in theory, if the two computer systems of the DWP and HMRC manage to bond together as they are supposed to do. However, the loss of disability support will cause problems in terms of incentives to work.
Sue Royston of Citizens Advice also provided me with the facts that were read out by the noble Baroness, Lady Lister. I will certainly not repeat them but I would find it helpful if the Minister could confirm for me how the two tapers of the universal credit on the one hand and the council tax benefit on the other will work together. Perhaps he has already done that when I was not here, as I have not always been here due to other commitments. I still hope that he will ultimately find a way to bring council tax benefit within universal credit, as it is such an important issue.
I am sorry to be a bore and raise this again, but it would make such a difference for so many people. If not, it seems to me that claimants working a few hours and building their employment up slowly will be dogged by a terrible complexity and lack of clarity not that dissimilar to what they have suffered in the past. That would be a great pity.
Baroness Hayter of Kentish Town
My Lords, the explanation that I am most looking forward to from the Minister, having taught us the difference between soon and very soon and that spring comes between winter and summer, is where on earth is the end of October if not yesterday, on Halloween night. We await that answer.
Under universal credit, the support currently obtained by a tax credit will be obtained via disregards, hence their importance. The disregards will allow some groups to earn higher amounts before benefit starts to be withdrawn, thus household income will be held to similar levels as now via tax credits. However, as has been mentioned, at present there seems to be no mention of disability in such disregards. Amendment 52B would provide an additional disregard for one aspect—carers who are currently not set to receive any disregard. We support that amendment and I shall speak to Amendment 52DB, which stands in my name and that of my noble friend Lord McKenzie. It would include a disregard for a second earner, but we will cover that issue in Amendment 52C. It is also intended to ensure that there are earnings disregards for claimants who are disabled, lone parents or the second earner—often a woman. Further to the comments just made, as each disregard recognises the impact of the particular circumstance on the earning potential of the individual, and as such impacts are cumulative, it is proposed in the amendment that the disregards should also be cumulative, as each circumstance—whether being disabled or being a lone parent—makes earning that much harder to achieve and, perhaps, more costly, with extra travel times or other expenses.
At least initially, it is foreseen that under universal credit we will have a 65 per cent taper for earned income, so a disregard improves the incentives to move into work by not applying the taper for the amount earned for the first disregard. That means that the value of the disregard for the claimant is 65 per cent of the actual amount written on paper, if you like. Someone with a £40 disregard who earns £40 can keep all their universal credit and will thus be better off by £40. Without the disregard, they would keep only 35 per cent of the £40 and so be only £14 better off. The figure of £40 that we use as the disregard is actually worth £26 in hard cash, which is the only way that I can think about these things.
There is a little complication, of course. There will be a maximum disregard for each group. Those not receiving support for housing costs will receive the maximum disregard and those getting support for their housing costs will see the maximum level of their disregard reduced by one and a half times the amount of their housing support. I trust that noble Lords are all with me. Good. Most claimants in rented accommodation will receive the minimum disregard. We know that universal credit aims to,
“allow people in work to see clearly how much support they can get”.
I just hope that they are better at doing that than I am.
The 14 October briefing note referred to by my noble friend Lady Lister on disregards set out the new higher disregard levels to try to deal with the localisation of council tax benefit. It aims to ensure that income support for council tax is effectively disregarded. Whereas single people previously would not receive any disregard, they will now get the amount mentioned, £13.50, as a disregard. Similarly, the disregards for lone parents and couples have been increased. However, as has been mentioned, Citizens Advice points out two problems. The first, elaborated by my noble friend Baroness Lister, is that those earning more than the amount will still be subject to two earnings tapers until no longer eligible for help with council tax. What plans does the Minister have to deal with this two-taper issue caused by the localisation of council tax benefit? Secondly, although the level of disregard has been increased to reflect council tax changes for single parents and couples, no such addition has been given to disabled people. Perhaps the Minister could also explain in his answer why they have been overlooked.
Lord Freud
My Lords, we learn more every Sitting. We learn that the mother of the noble Baroness, Lady Hayter, is really a Conservative, and therefore that she is. We had the admission the other day from the noble Baroness, Lady Lister, that she actually was a Conservative. I can only say: “You are very welcome back any time; I would prefer you to come back very soon”.
I know that the noble Baroness was mathematically challenged over the past week. I can offer only my noble friend Lord German, whose ability to sort out the sums of Labour politicians is now famous; I am sure that he will help her sort everything out.
I have to be absolutely clear about the date when October happens. October happens when the Committee gets towards the PIP clauses. That is the definition. The fact that that has moved is due only to the extraordinary assiduity of Members of the Committee, for which I know that we are all grateful.
I should just deal with the council tax, which strayed into this. It is not possible to analyse how different tapers will work because we do not know how the council tax will work. We will find that out. One issue behind any restructuring is that we are determined that it will not undermine work incentives; in the universal credit, we are dealing with that by enlarging the disregards.
I must pay tribute to carers. I want to put on the record that they do a terrific job. We know that, and we have been very conscious of it as we develop the universal credit. Taking Amendment 52B first, we have looked at how we support carers. Rather than going through the complexity of the separate disregard route, we have provided an additional element that is included in the gross amount of the universal credit for carers. That is a change from carer’s allowance. This additional element will not be withdrawn when the claimant’s working hours pass a particular threshold, which is what happens now. Instead, the claimant’s award will reduce gradually as earnings increase due to the effect of the single earnings taper.
The structure of earnings disregards in universal credit is not the same as that in current out-of-work benefits. We do not propose to carry forward the weekly £20 disregard that applies to carers in income support currently. In practice, many carers will receive an earnings disregard that is higher than £20 because they are lone parents or members of couples or if they or their partner are disabled. All carers will have the earnings taper applied to earnings beyond the relevant disregard. These measures will significantly enhance work incentives for carers in the vast majority of circumstances. We have taken the decision to standardise the provision for single non-disabled people in universal credit so that all claimants in this group will have £700 of their annual earnings disregarded. Simplifying measures such as this are essential if universal credit is not to replicate the complications of the current system, which breeds confusion and error for both claimants and administrators.
Baroness Hollis of Heigham
My Lords, I am following the Minister with as much attention as I can muster on a very complex subject. We share and appreciate his remarks about carers, of course, but does he not recognise the difference between a single person who may, for example, be a young man going into the labour market with an earnings disregard on his universal credit and the situation of a carer who may be caring for 40 hours a week and therefore has limited opportunities for work? If she does not have a disregard, it will actually not be worth her working at all, but the level of her caring responsibilities, although they do not qualify her for CA, will mean that she is unable to meet the work conditions and earn a living. What would the Minister have her do?
Lord Freud
My Lords, I turn to the example raised by the noble Baroness, Lady Lister. With great skill she has found precisely an area of loss within a general position of substantial improvement. Let us take a single non-disabled carer. If they work between roughly two and five hours at the national minimum wage, they may have a marginally lower net income as a result of this structure. The maximum possible reduction in those circumstances is around £4.25 a week, which is in line with the noble Baroness’s example. But at only marginally higher earnings, work incentives increase significantly under universal credit. For example, at only eight hours a week, such carers would be over £5 a week better off, and at 12 hours a week they would gain nearly £15. So there is a stronger incentive to get back into work than the flat £20 flat disregard in income support.
I shall pick up the point made by the noble Baroness, Lady Hayter—
Baroness Hollis of Heigham
I still do not understand how she could be expected to add those hours of work to her hours of caring, even though the hours of caring do not qualify her for CA. Therefore you invoke not just four, six or eight hours, but full conditionality.
Lord Freud
You do not when there are caring responsibilities. We have discussed this. There is a responsive set of conditionalities for people who have other obligations. If you exclude people with very few hours—many will do those few hours for rather more than the minimum wage—they are actually much better off than under the current circumstances because we have done it through addition rather than as an extra disregard.
The noble Baroness, Lady Hayter, said that an estimated 50,000 carers will be worse off under the universal credit. That is not correct. That figure was an estimate of the number of single and non-disabled benefit claimants who are carers. Only those whose earnings fall within the very narrow band of two to five hours at the national minimum wage could experience a very slightly lower income under universal credit.
I turn to Amendment 52DB. The universal credit is designed to help improve work incentives to break cycles of worklessness. A couple will jointly benefit from a single earnings disregard set at the highest amount to which either person is entitled. In practice, this may mean that only the earnings of the first earner are disregarded. Given the financial constraints within which we are delivering universal credit, it is best to focus on the clear aim of reducing worklessness for the household as a whole rather than spreading the available resources among different earners in one household.
To revert back to an earlier amendment on piloting, this is clearly something that we can test. If that gets a better result, it can be changed when a Government have adequate money. This is not a matter of principle but of affordability. We estimate that if couples who were both in work were entitled to—
Baroness Meacher
Again, will there be flexibility within the legislation? As the Minister said, if the Government pilot this and find that the taxpayer is losing more money because fewer of these second earners go out to work, he will want to introduce a second disregard. Will there be the flexibility within the legislation to enable the Government to do that?
Lord Freud
Absolutely. We are discussing a framework piece of legislation that will allow us to bring in the regulations. I am sure that next year many of us will discuss the detail of this for many months. It is an introductory, not a locked-in proposition. I have tried to explain, and hope that I have explained, that this system is an architecture and it can roll and improve. We may find in many areas that a change will pay for itself in its own terms, both in what the benefit system costs and the benefit to the economy. We will be able to test those propositions. A lot of what I talk about when we lay out the structures is simply what is affordable within a very difficult financial environment where we have had to put a proposition that we can float and that works. I have made the point before that that is within a context where we are injecting £4 billion into the pockets of the poorest people. Every time someone says, “Do that” or “Do the next thing”, they are adding to that figure. We can either take something else away or provide that. That is where we have come out. Later on, when the financial situation is more suitable or we establish that changing something pays for itself in its own terms, we can make changes and improvements. I labour the point only because we can spend a lot of time arguing whether this is better than a disregard or addition. The answer is that none of us knows but I hope that in the medium term we will.
In the example, we estimate that if couples who are both in work were entitled to an additional disregard of £700 a year, the cost would be £240 million. If the disregard was £1,000 a year, the cost would be £350 million. This is real money. We took the decision that it would be better spent, for instance, on childcare, where we had to find an extra £300 million. In current out-of-work benefits, there are no additional disregards for second earners. Similarly, working tax credit makes no additional provision for second earners. It is true that members of a couple may qualify for the disability elements of working tax credit if both are working and disabled. Equally, when a disabled person is not in work, no disability element can be paid. Indeed, working tax credit may not be payable at all.
I turn to the proposal that lone parents, disabled people and second earners should receive the sum of two earnings disregards if their circumstances entitle them to each, rather than the higher of the two as we propose. Many people on low incomes will have substantially more support under universal credit because of the earnings disregards that we propose. The standard weekly disregard in current out-of-work benefits for these groups is only £20, after which benefit is withdrawn pound for pound. Some people on employment and support allowance may benefit from the permitted work rule with a disregard of up to £95 per week. However, this provision is available only for one year, after which the disregard returns to £20 for most claimants. Crucially, earnings disregards are not added together in current out-of-work benefits.
In working tax credits, various elements can be added together. However, that does not differ from the way elements in universal credit build up to a total award. The earnings disregards in universal credit are more generous than those in the current system for lone parents and disabled people, helping in particular those working a small number of hours. For instance, a disabled person working 12 hours a week at the national minimum wage will be more than £50 a week better off, and a lone parent will be more than £60 a week better off in work because of the disregards in universal credit. This will provide a stronger incentive to work than exists in the current system.
For most people claiming universal credit, the main financial incentive to work will be provided by the taper. Our proposals for a structure of disregards are intended to provide an additional incentive for those who need it most. If additional funding were available, we would need to consider the taper as well as the disregards. Adding together two or more disregards simply because the claimant falls into a number of categories would be inconsistent with the approach that we have adopted. If the earnings disregards worked in this way, we would not have the funding to set each at the level that we have. Universal credit must be delivered within the financial envelope we have available. I hope that this explanation will persuade the noble Baroness to withdraw her amendment.
Baroness Hayter of Kentish Town
My Lords, I will raise a couple of points—and not simply to defend my aunt. I said that she worked at the Conservative club. She was the barmaid and cleaner. The noble Lord is very lucky that she is no longer with us.
Lord Wigley
I have been mulling over this point. Is the noble Baroness sure that she is not inadvertently misleading the Committee? Surely there is no such thing as a Conservative club in Ystradgynlais.
Baroness Hayter of Kentish Town
Perhaps I may ask a couple more questions. I think that the Minister said that the figure I used of 50,000 was wrong because the only people who would lose out are those working between two and five hours at the national minimum wage. However, it is exactly those sorts of people who are carers and who will be doing quite small numbers of hours: the six-to-eight shift, if you like. Even though it is a small number of people, it would be interesting to know whether there was an impact assessment of the effect on carers and whether it showed how they would be affected.
I have two other points. One is about the figure of £4 billion, which gets used a lot. The disregards will not necessarily cost the Government money; if they are encouraging people into work, those people will quite quickly start paying tax and NI—not immediately but fairly quickly—and they will quickly pay for themselves. I realise that that will not happen at the moment as there is rather a lot of unemployment because of the Government’s policies, but we will not go there. Normally, though, the incentive is to get people into work, so that will soon begin to pay itself off.
Baroness Thomas of Winchester
May I interrupt the noble Baroness at this point? I would like to ask my noble friend about the new test that is going to be devised for those disabled people in work. I do not think that he answered that. I apologise for interrupting the noble Baroness, but before she withdraws the amendment I would like to know whether he has any news or wants to write to me afterwards.
Baroness Hayter of Kentish Town
My second point is that the question that was not asked is why there is no additional amount of disregard for disabled people to take account of the council tax issues. I presume that the noble Baroness, Lady Howe, will speak, but if those extra points could be referred to it would be helpful.
Baroness Howe of Idlicote
My Lords, this has been an interesting and extremely wide-ranging—
Lord Freud
I shall try to answer the questions. To pick up the point from the noble Baroness, Lady Hayter, there is not an impact assessment on carers, but if we are talking about an entire universe of 50,000 and then we have to narrow it down to this very small group who are working two to five hours at national minimum wage, we are talking about a very small number. Do not forget that there is an element of the system that people change behaviour to fit around. You can see the encouragement here, as I was showing noble Lords, to start earning a little more than the five hours. The reality is that this is a very small impact. There are winners and losers all the way through the universal credit because we are putting in a new system.
To pick up the question from my noble friend Lady Thomas, the tax credits will no longer exist once the universal credit is introduced. As we stated in the revised policy briefing note—she has spotted this with her eagle eye—we aim to have a single assessment as the gateway to limited capability for work elements and the earnings disregard for disabled people. This assessment will be based on the work capability assessment and we are considering that this process may need to be modified in the context of the universal credit. We will have a chance at a later stage of the Bill to discuss the WCA in a little more detail.
Baroness Hollis of Heigham
The Minister has been very full in his efforts to answer our questions. Could he have his staff prepare for us one of the very helpful briefing notes that we have had on the situation of carers in the various scenarios that have been outlined over the past few Committee days—carers who are one of a couple, single carers, carers who may be able to work a few hours, carers who are not on CA and are therefore exposed to work conditionality, and carers who are on CA? That is eight or 10 possible permutations, and that would be helpful. This is before we get to council tax benefit and its screwy effects on the whole system. It would be very helpful if the Minister did us a briefing paper as soon as was practicable on the situations that carers could find themselves in.
Lord Freud
I cannot absolutely commit to that, mainly because I have a department working at full tilt. However, I will look at whether that is the kind of work we can do without disturbing all the other demands on people’s time.
Baroness Hollis of Heigham
I am grateful to the noble Lord because it is an issue that is dear to their Lordships’ hearts.
Baroness Howe of Idlicote
My Lords, I have been fascinated by the wide range of issues and figures that we have had to digest. It is clear that we will have to wait for the information on PIP with increased enthusiasm. However, I suspect that we will have to wait a day or two yet. I thank everybody who has contributed to the debate—a considerable number did so—particularly my noble friend Lady Lister, who supported my specific point but raised a lot of other fascinating issues.
I am afraid that I failed to say at the beginning that I owe my briefing to Carers UK, which produced an amazing range of facts and figures. The number of women carers must not be overlooked. It constitutes a huge percentage. It is well and truly worth taking into account what the state would have to pay if it were the carer in all the instances that we have talked about. The present system costs comparatively little. We will have a lot to read in Hansard tomorrow, quite apart from studying the table that we have asked for. In the mean time, I beg leave to withdraw the amendment.
Baroness Donaghy
Baroness Donaghy
My Lords, the purpose of this amendment is to recognise the particular needs of the self-employed. It would ensure that the power to prescribe a minimum level of income applies only to those self-employed claimants who under-declare their earned income with a view to maximising their entitlement to universal credit.
While it is important to prevent abuse of the system, it is equally important not to discourage the genuine self-employed claimant with a potentially viable business in the early stages of development or one that is in financial difficulty. The White Paper acknowledges that,
“in starting up a business … it can take some time before it becomes profitable”.
It proposes that the minimum income floor should be applied only when a business has become “established”.
There is at present no indication of how that is to be interpreted or what guidelines or regulations will be issued, so I ask the Minister: when will this information become available?
As I said at Second Reading, there are some 4 million self-employed people in the UK, and that number is likely to grow as employment becomes more difficult. It represents an enormously varied group which faces a greater degree of risk than is faced by those in traditional employment. Profits are affected by any number of events such as the loss of a key customer, the sickness of the sole proprietor, a bad debt or accumulation of slow payers, or even by taking on a new employee. The measurement of self-employment income for universal credit purposes should follow generally accepted accountancy principles and aim at a true and fair view of a business’s profit. The welfare system needs to support businesses through such periods, not discourage them by imposing unrealistic levels of deemed income such as the minimum income floor.
My amendment recognises that real abuse should be directly targeted, but that if you impose a minimum income floor for each hour worked, that in itself will open the floodgates for abuse. This view is supported by the National Farmers’ Union, the Tenant Farmers Association and the Federation of Small Businesses, as well as by Community Link, Citizens Advice and the Child Poverty Action Group. There are those with disability or a medical condition that makes it difficult for them to take traditional employment. We have already heard from the noble Baronesses, Lady Grey-Thompson, Lady Thomas of Winchester and Lady Wilkins, about how difficult it is for the disabled to find employment. Being self-employed often allows the disabled to work at their own pace and according to a pattern that suits their circumstances.
I have another question. What steps are the Government taking to minimise the compliance burden on the self-employed? The current system requires only one set of accounts to be prepared, which is accepted for both tax and tax credits. This allows the individual to get on with running their business. If a different measure of self-employed income were to apply for universal credit, the burden would increase because individuals would have to assess profits for tax purposes according to one measure and income for universal credit purposes according to another, quite different, measure.
If income is to be based upon reported hours, the harder a self-employed person works to get their business on its feet, the more they could lose from their universal credit entitlement. Some might spend as much time seeking paid work as actually doing it, such as taxi drivers who may work 50 to 60 hours per week or more. It would be unfortunate if this measure were to deter genuine claimants from taking the risks inherent in self-employment when its purpose is to prevent a minority under-declaring their profits.
Perhaps I may give a real example sent by the Royal Agricultural Benevolent Institution. I hope that it is not one of those examples that the Minister will say is a unique and very special man. He is a single man aged 53 on a rented 160-acre farm, farming arable/field vegetables only. He has had a disastrous winter and lost the whole crop due to bad weather and flooding. Consequently, he has made a loss this year and is very distressed. As this would be calculated by HMRC to be nil earnings, he is currently eligible for a full working tax credit of £51.87 per week. Under the proposed changes in the universal credit, he will no longer be entitled to any help. The circumstances were beyond his control, and without the safety net of the tax credits he will be unable to get back on his feet and carry on farming. What will he do? Is this an example of someone where savings are to be made? Is he to face the humiliation of getting advice from Jobcentre Plus about diversifying or going to work for the farm next door?
There are already regulatory powers to counteract moves by claimants to under-declare their income for tax credit and benefit purposes. Under the income deprivation rules, a person is deemed still to have income of which they have divested themselves in order to maximise their claim to benefit or tax credit. Where the Government perceive this abuse, surely the right course is to enforce existing powers rather than invent new ones that will discourage genuine cases.
This brings me a group of individuals who in practically every sense of the word are employees but who are treated as self-employed because the alternative is no job at all. When I was a member of the Low Pay Commission, a situation where economic circumstances took away choice was called monopsony—which is not a word that is used very often. I have met home workers who were forced to accept self-employed status in order to earn money. If they asked questions, they would be replaced with one of the hundreds of women in the area who were confined to their homes for domestic or cultural reasons and were equally desperate for work.
In the construction industry up to 90 per cent of workers in London are self-employed, and yet they are told when to turn up for work and what to do when they are at work. HMRC is responsible for the construction industry tax scheme, the CIS, where contractors submit monthly returns detailing their subcontractors and certifying that none of them is in fact an employee. However, the questions asked of a contractor to establish whether any of their subcontractors are self-employed are remarkably similar to the criteria used for identifying direct employment. Successive Governments have tried to deal with the issue of bogus self-employment with little measurable success. In my report on the construction industry I wrote that:
“It may be that successive Governments see the various schemes they have adopted as a buttress against the huge informal economy in construction—a compromise so that at least some tax is collected”.
I raise these two examples of bogus self-employment—some home workers and some construction workers—to emphasise that the Government’s proposals could penalise the genuine self-employed and fail to tackle some of the gross abuses that happen now. These abuses could be alleviated by the proper enforcement of our tax laws by HMRC and of our employment laws by the Department for Business, Innovation and Skills in conjunction with the Department for Work and Pensions—with all the resources that that implies. It would also mean a level of interdepartmental co-operation in Whitehall that would make even the Minister with his acknowledged abilities blench in terror.
In conclusion, there is a clear distinction between profits on the one hand and drawings on the other, and welfare policy must reflect that distinction if in-work support is to succeed in promoting work through self-employment. The success of working tax credits in encouraging work, in particular self-employment, rests on a recognition, in alignment with the tax system, of the economic reality of how a business is doing, particularly with regard to investment in business equipment and trading losses. How is the Minister going to treat the self-employed, and does he think that my amendment would help to emphasise the real target rather than those struggling to survive in deeply difficult financial circumstances? I beg to move.
Lord Wigley
My Lords, I give enthusiastic support not only to the amendment but also to the direction in which the noble Baroness is taking the Committee. The need to ensure that disabled people do not feel that they are being debarred by the system from becoming self-employed is very important indeed. Possibly it has been a greater problem in the past and I hope that it will become even less of one with the changes we are getting. However, we need certain assurances if that is to be the case. I believe not only that this is in their own interests, given that self-employment can offer a flexibility which can be very useful, but also that they have a massive contribution to make. Given support, disabled people can also become the employers of other people. Therefore I hope that it will be possible to give the assurances that have been sought in the amendment in order to move things forward on this agenda.
Lord McKenzie of Luton
My Lords, I support the very powerful case that my noble friend Lady Donaghy made, and what the noble Lord, Lord Wigley, said. The case of self-employment is clearly very substantial. My noble friend Lady Donaghy spoke about two issues: how the self-employed should be treated, and the problems of those who are not technically self-employed but who are treated as such. I confirm that my noble friend wrote a very important and powerful report that she presented to the DWP. It gave the Minister at the time a lot of food for thought, from which he has not totally recovered.
I will press the Minister on a couple of points that my noble friend raised. What will the process be for self-employment? Will it be based on the accounting profits of the business or on the tax profits? The noble Lord will be aware that they do not necessarily amount to the same thing in the same time period: for example, because of depreciation allowances for plant and machinery. How will that work? For example, if a start-up records a loss in year 1, that will be a zero rather than a minus for universal credit purposes—but does the minus get carried forward to year 2 to reduce year 2 profits? Generally it would be for tax purposes, but will it for universal credit purposes?
The period of assessment that will be taken into account—the reporting process for self-employment—clearly is a significant issue. I am very unclear about the plans, and in particular whether they will specify tax profits or profits computed for tax purposes. Obviously over time the two ought to align, but they will not necessarily align in the same period. How they are treated for universal credit purposes will be of significance.
Lord Freud
My Lords, after spending four years writing the Lex column, I am absolutely aware that I cannot answer the question of the noble Lord, Lord McKenzie, off the top of my head. The definition of profits is a knotty and complicated issue that he is absolutely right to focus on. We need to get it right after detailed consideration. Of course it is a long-standing policy that people should be treated as having income or capital in cases of deliberate deprivation. This will continue under universal credit. However, we also think that it is right in principle to apply a minimum income floor to claimants who choose to be self-employed but whose earnings do not make them financially self-sufficient. Because universal credit is a benefit for people in and out of work, the issues around self-employment are different from the issues faced in the current system.
The Deputy Chairman of Committees (Viscount Ullswater)
My Lords, there is a Division in the House. The Committee will adjourn for 10 minutes.
Lord Freud
My Lords, because universal credit is a benefit for people in and out of work, the issues of self-employment are different from those faced under the current system. We need to have clear rules—in particular, on when conditionality requirements do or do not apply to people who are working for themselves and so have a degree of control over their hours and earnings.
Clearly, we need to avoid requirements that will add unnecessary burdens, especially for people who are starting out in business, but we cannot have a situation where people can be treated as being in full-time work for the conditionality purpose but, because they declare no earnings, receive as much benefit as if they were not working at all.
I appreciate that noble Lords have many questions about the detailed rules on the treatment of self-employment income. This is a complex area and we are still working through all the details. The experts in this field are in HMRC and we are working closely with them to develop our proposals. I can confirm that the level of assumed earnings will not be based on the number of hours that the claimant works. Instead, we would assume that a claimant’s earnings are at the level we would expect of claimants with similar circumstances in employed work. In response to the question by the noble Baroness, Lady Donaghy, and the observation of the noble Lord, Lord Wigley, this includes whether they are disabled. As part of our work with HMRC we are considering the assessment of self-employed earnings. It will be important to determine which rules from the current benefit and tax credit systems give the most appropriate framework for universal credit.
The rules on the treatment of self-employed claimants will be set out in regulations and the Bill provides expressly that the regulations on the minimum income floor will be subject to the affirmative procedure in the first instance. The House will have the opportunity to scrutinise the details in this area at a future date.
With regard to the noble Baroness’s amendment, the wider application of notional income capital rules rightly considers whether the claimant has manipulated their income in order to become eligible for universal credit. We believe that different issues arise in relation to self-employment and it would not be right to limit the scope to assume a minimum income in this way. I hope this explanation will allow the noble Baroness to withdraw the amendment.
Lord McKenzie of Luton
My Lords, I wonder if the Minister can help us further. In a situation where you have a start-up, where an individual sole trader is working all the hours there are to make a success of the business, doing all sorts of groundwork that often needs to be done, how is an assessment going to be made by the department that this is insufficient? What judgments are going to be made and how is that going to proceed?
Lord Freud
My Lords, the noble Lord makes a very important point and it is related to the point of the noble Baroness, Lady Donaghy. There are two areas where we will have to have specific rules. First, in the start-up phase, what are the rules for that and how long does one allow for it? Secondly, in the period when something goes badly wrong, when you have had a business going very well with profits and then you have a sudden collapse, what do you do about that period? That was the example that the noble Baroness, Lady Donaghy, raised. Those are two of the issues that we are looking at very closely and how to get that right.
One of the things we want to get out of this is the most business-friendly suite of support that we can put together. In this sense, working tax credit for the self-employed does become a support for entrepreneurial endeavour, tied with other support for new business such as the new enterprise allowance.
Lord McAvoy
My Lords, on the small businesses aspect—and I declare an interest as I am “lucky” to own a public house although I am a teetotaller and they are closing down all over the place in Scotland—
Lord McAvoy
Most are tight-fisted so do not think you will get a free drink. What information is needed, and where would you get the information, to make that sort of calculation and deliberation? The feeling among small businesses is that nobody listens.
Lord Freud
My Lords, I am looking forward to my invitation to the McAvoy public house. I hope that it is called “The Lord McAvoy” with a nice—
Lord Freud
And I hope that it has a nice picture of him. I look forward to going there.
Lord Freud
The basic way to get information from the self-employed is this: they will put in the information in the universal credit system, or an equivalent system, which will potentially match up later with the information that they provide either to the VAT authorities or to HMRC. There is a process of reporting.
To get back to the point, there is an opportunity to provide real support for entrepreneurial business, but as the noble Baroness, Lady Donaghy, so shrewdly said, we must not be an open cheque book for people who are not running genuine businesses. We need to get that right.
Baroness Hollis of Heigham
Something has been puzzling me. We are talking about self-employed as if it were a self-employed single person. What happens if you have a small family business—not quite the corner shop—where the income from that self-employed business in which the partner, say the wife, is doing some part-time book-keeping, answering the telephone, and so on and contributing to fairly low profits? How will you assess whether conditionality applies to her?
Lord Freud
My Lords, universal credit is particularly well suited to that situation because it is a household income. We will have rules on the two benefit recipients in a two-person household, so we should be able to adapt to that reasonably straightforwardly. Clearly there will be circumstances when one person is in paid employment and the other is self-employed, and we need to mix that. We are working on defining all those situations so that we can make universal credit work appropriately.
Lord Wigley
To follow that point through a little, I understood that the intention was not to take the circumstances when one was in paid employment, but when both might be employed or self-employed in their business and both getting their income. Presumably there would need to be some attention to those rules as well.
Lord Freud
My Lords, I am sorry. I probably broadened the point that should have remained narrow. When two people are working on one endeavour, because universal credit is a household payment, it can accommodate that without any distortion.
Lord McKenzie of Luton
I do not usually come to the Minister’s aid but if you have two people in business together, that would be a partnership and you would typically look at each person’s share of the profits and presumably aggregate those if they are part of the same household, not if they are in different households.
Lord Freud
My Lords, this is one area where a single earner disregard makes life rather easy. I hope that we will be congratulated on that structure.
Lord McKenzie of Luton
Can I just make one other point? It is wrong of us to press the Minister as I know that this is embryonic and a lot of work is going on. If the process is to be some early report in that has to be assessed against what is eventually a tax assessment or consistent with VAT accounts, that sort of presupposes that there has to be some look-back or process of adjustment—in a sense the tax credit-type arrangement, which is quite different from the real-time earnings for employed people. Does the noble Lord envisage that as part of the system?
Lord Freud
It is clear that we cannot use real-time information for the self-employed. It is another system. It will be much closer to the kind of reporting systems for tax credits in this area—and for that reason.
Lord Wigley
A disabled person might have feared going self-employed in the past because of the possibility of losing benefits and not being able to get them back at some future date. That would have been a psychological barrier. Could the Minister confirm—I am sure that he can and will be eager to—that that problem should be overcome by this system? It should be sympathetic to, and encouraging of, people becoming self-employed.
Lord Freud
Yes, the system is absolutely straightforward for a disabled person who goes into employment, where it is unequivocally much safer. There is a difference in self-employment in that, in cases of low earnings, we will look for an element of potential conditionality and a relationship with that person when they do not want to observe the minimum income floor. You have a choice: either have a minimum income floor and then there is not conditionality; or you come below it and there is a conditionality regime. That does not mean there is an instruction saying, “It is out to work. Stop what you are doing”. It absolutely does not mean that. It means that we know what people are doing and, after discussing it with them, can reach an assessment of what they should be doing. In many cases we will be absolutely happy for them to continue that regime. It offers us an opportunity to know what is really happening out there—I suspect in a way that we do not know now.
Baroness Donaghy
I am extremely grateful to the noble Lords who took part in this discussion—the noble Lord, Lord Wigley, and my noble friends Lord McKenzie, Lord McAvoy and Lady Hollis. I have learnt something today. I did not know that my noble friend Lord McAvoy owned a pub. I do not know if that makes him a licensee. I thought that I was the only licensee in the House of Lords. I was one for 16 years. We must obviously now compare notes.
I am also extremely grateful to the Minister. I take assurances from some of the things that he said. He accepted that the self-employed are different and that their situation is complex in relation to this subject. He is determined to produce clear rules—I have written that down: “clear rules”. I do not know if those rules will be as clear as those in Amendment 52B from the noble Baroness, Lady Howe, and my noble friend Lady Lister, which was just debated. Let us hope that they are really clear.
I take assurance from the Minister saying that we cannot use real-time information. I am aware that this is work in progress. I have some worries about the when. In my contribution I asked when this information was going to be available. I am pleased that we will have the opportunity to look at this in terms of the affirmative situation to which he referred. We will have another chance to look at the regulations. He acknowledged that specific rules will try to cope with things like the start dates and what happens when things go badly wrong. Again, I welcome the fact that he has tried to cover the entire patch.
I understand why he baulked at mentioning the issue of bogus self-employment. It is a big subject but I must come back to the comment that some of the real abuses are around the edges of the twilight zone of informal economy, bogus self-employment and people who abuse the system—sometimes all three. The sooner we can get some co-ordination in our systems, the better for everyone. I may come back to haunt the Minister about this whole area on another occasion but in the light of those positions, although still with some question marks, I beg leave to withdraw the amendment.
Lord De Mauley
I hope noble Lords would agree that this might be a convenient moment for the Committee to adjourn until 2 pm on Thursday.
House of Lords
Coroner Service
(12 years, 6 months ago)
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Baroness Miller of Chilthorne Domer
To ask Her Majesty’s Government what responses they have received on the draft charter for the coroner service from organisations that represent the bereaved, and whether they anticipate making any substantial changes before they publish the charter.
The Minister of State, Ministry of Justice (Lord McNally)
My Lords, the Government received 135 consultation responses, of which 16 were from organisations representing the bereaved. We are concurrently considering these responses, and we intend to publish our response to the consultation in December.
Baroness Miller of Chilthorne Domer
My Lords, the Minister will remember that the idea of the charter was that it would create a standard of service for bereaved people. He will be aware that the Government now propose a general charter for anyone coming into contact with the coroner service. What does he say to the likes of the father of Adrian Pullman, now himself dying of cancer, who has waited eight years for an inquest into why his five year-old only son was found dead in a swimming pool on a local authority care break? Does the Minister recall that in 2009, when we debated the Coroners and Justice Act, the coroner’s office involved said, “We have a lot of cases but this will be given a bit of priority because of the delay, but I cannot foresee it being heard before the end of the year”? It has still not been heard. Can the Minister say what in the Government’s revised proposals would mean that a bereaved father no longer had to wait eight years for an inquest?
Lord McNally
My Lords, let us be clear that in a system such as this delays are sometimes unavoidable; for example, because of ongoing criminal or other investigations or, in some cases, because of the family’s wishes. We want to ensure as efficient a system as possible. As part of that, we believe that the measures in the Coroners and Justice Act 2009 which we are implementing will help to reduce delays. We will also publish a wider range of statistics about the coroner system than we presently collect, drawing on our experience of service personnel inquests, where the quarterly publication of statistics has helped to eliminate delays throughout England and Wales.
Baroness Finlay of Llandaff
My Lords, how many complaints were received last year about the proceedings and delays in the coroners’ courts and how are they informing the revision of the charter, given that some coroners feel that the aspirations set in the charter are unrealistic in situations such as when a second post-mortem needs to be performed?
Lord McNally
I do not have those figures, but I will write to the noble Baroness. Everything we have done in studying this process is aimed at improving the efficiency of the system. I do not think that the simple removal from the reforms of the single post of chief coroner removes the fact that we are implementing the Coroners and Justice Act 2009. We have reviewed very thoroughly. We have consulted very thoroughly, as the noble Baroness knows very well, and we believe that our reforms will bring the improvements that the original Act sought to do.
Lord Bach
My Lords, just two years ago, the consensus in this House and in the other place was that the chief coroner was an essential part of a new coronial system. In spite of the views of this House, and of many outside, including the Royal British Legion, why are the Government still insistent on not appointing a chief coroner, who would be an important part of the reforms that Parliament agreed by consensus?
Lord McNally
A Government is allowed to look at an issue, examine widely, listen, consult, and then make a decision in the context of the financial circumstances it finds at the end. My right honourable friend the Lord Chancellor has decided that the immediate appointment of a chief coroner is not justified in the present circumstances. After listening to the various representations, we left the title of chief coroner in Schedule 5 to the Bill when it returned from the other place, and that will allow this House, the other place and the outside organisations to judge whether we are still able to carry through the bulk of the 2009 Act without the chief coroner. We believe we can, and by our deeds you can judge us.
Lord Thomas of Gresford
The charter will not be statutory so how will it be enforced?
Lord McNally
The Coroners and Justice Act 2009 provides for the Lord Chancellor to issue statutory guidance about the way in which the system operates, specifically in relation to bereaved families. We plan to revise the charter when we implement the coroner provisions in the Act and at that stage we will give the revised charter the status of statutory guidance.
The Lord Bishop of Bath and Wells
My Lords, in view of the Government’s declared objective of putting the bereaved at the heart of the inquest process, will the charter make provision for the special circumstances affecting communication with families whose loved ones have died in the custody of the state, and will it take into account the submissions made by the organisation INQUEST?
Lord McNally
Indeed, we have been in regular contact with INQUEST and those are exactly the kinds of issues for which we hope the new charter will enable the bereaved to have direct redress if problems arise. Let us be clear: as much as the previous Government, we want an efficient coroner service that allows bereaved people full information about a process which is always going to be stressful. It really is our full intention to try to make this system work along the main lines of the 2009 Act, but without a chief coroner.
Lord Rooker
Does the Minister accept that the Question asked by the noble Baroness was a first-class use of Question Time in bringing a long-standing individual grievance to the Floor of Parliament? Without knowing anything about the circumstances, would it not have been appropriate for the Minister at least to have said that he will go away and look into this?
Lord McNally
It may have been. I am not so sure that it is a proper use of Question Time to expect the Minister to know about an individual, personal case, which I fully understand for the individuals concerned must be extremely serious. One of the things that I do, as the noble Lord probably did as a Minister, is have a washing-up session after Question Time to see what needs to be followed up. However, I do not intend ever at this Dispatch Box to use personal cases either for attack or defence.
Baroness Farrington of Ribbleton
My Lords, will the Minister explain to the House how the Government determine priorities? We are talking here about a consensus across the other place and your Lordships’ House on the importance of this post. The issue has been raised by the noble Baroness, Lady Miller, on many occasions in this House. Yet, the Government pray in aid being careful with money while railroading through police and crime commissioners, who will cost millions and for whom there is no consensus outside. Where are the Government’s priorities when it comes to this sort of issue?
Lord McNally
I have already explained the process. I do not think that the noble Baroness, Lady Finlay, my noble friend Lady Miller or other noble Lords have said that the Government have not been available to discuss matters or to go through the process with them. Just as when the noble Baroness was a member of the previous Government, the Government are entitled to make a judgment on a matter and to put it to the House. This matter will return to this place and the House will then have to make a decision. It is simply not true that we have not listened. We have made substantial changes to the implementation of the Coroners and Justice Act, so much so that I believe that I can stand up the claim that we are implementing the bulk of the 2009 Act. But our judgment is that a chief coroner is not needed in post at this moment. We have left it in the Bill so that a judgment can be made at a later stage. But at this stage the Government’s judgment is that we should not go ahead with a chief coroner. At a later stage, when the Bill returns to the House, I will defend that position.
Health: Funding
(12 years, 6 months ago)
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Lord Roberts of Llandudno
To ask Her Majesty’s Government whether they will take action to ensure that there is no delay in funding medical treatment in hospitals in England for residents of Wales, Scotland and Northern Ireland.
The Parliamentary Under-Secretary of State, Department of Health (Earl Howe)
My Lords, in the future it will be the role of the NHS Commissioning Board to act as the steward of NHS resources in England, including managing the structure of payments for NHS services. During the transition to the new NHS structure, officials from the Department of Health are working with colleagues from the devolved Administrations to understand and resolve any issues which are arising as the result of the devolution of the responsibility for healthcare.
Lord Roberts of Llandudno
I thank the Minister for that reply. Will he give us an assurance that no person needing medical attention, wherever they are in the United Kingdom, shall be denied the very best attention possible, and that in order to facilitate that—and I have some indication that this is already happening—there should be immediate discussions between the devolved health administrations and here to make sure that neither funding nor procedure nor anything else will prevent the best treatment for patients wherever they are in this kingdom?
Earl Howe
I fully agree with my noble friend that the same principles should apply across the United Kingdom as regards access to NHS treatment and facilities. The majority of cross-border flows occur in relation to Welsh patients coming in to England, and I am not aware that there are particular problems there. The Department of Health and the Welsh Government have agreed a protocol for cross-border healthcare commissioning, to define commissioning and payment arrangements for those living along the border. I believe that that is working well.
Lord Wigley
My Lords, is the Minister aware that there are numerous cross-border issues between the north Wales area and the Liverpool and Manchester area, where many people get their services and treatments? Is he aware that the NHS policy changes currently being pursued in England are estimated to have a knock-on negative effect of no less than £11.5 million on the Betsi Cadwaladr health board, which serves the north Wales area? In those circumstances, is it not imperative that the health departments in Wales and England work together very closely indeed so that our health board can plan safe and sustainable services for all the people living in north Wales?
Earl Howe
Yes, I agree with the noble Lord. It is important that officials from both Wales and England have a dialogue to ensure that problems do not arise of the kind that the noble Lord refers to. Having said which, I repeat that the protocol that currently exists, and the funding that we in England give to the Welsh Government to compensate for differences in prices between either side of the border, serve to ensure that patients are treated promptly and as they should be.
Lord Jones
Does the Minister fully comprehend that the border between England and Wales is over 200 miles long; that the bulk of the population of Wales is in the east; and that historically there has always been access—for example, from north-east Wales—to the great hospitals of Christie in Manchester, Broadgreen in Liverpool and Alder Hey in Wirral? Does he fully comprehend the current anxiety? It is the wish of the mass of the population that they should have access to these hospitals—hospitals of access and excellence—and that Ministers in England should take a generous and understanding attitude to the wishes of a population who have always had access to the excellence of these great hospitals, of which the people of north-east Wales are very fond.
Earl Howe
My Lords, I appreciate everything that the noble Lord has said. He may like to know that the protocol to which I have referred states as follows:
“The patient’s safety and well-being must be paramount at all times. No treatment must be refused or delayed due to uncertainty or ambiguity as to which”—
local health board or PCT—
“is responsible for funding the healthcare provision”.
I think that that should give patients in Wales every reassurance.
Lord Elystan-Morgan
My Lords, does the Minister accept that there is one very specific matter in relation to transborder matters in Wales, and that is in relation to Powys? Despite strategic policy decisions of many years ago, Powys has never had a district general hospital, with the result that there is a very considerable flow from north-east Powys to hospitals in the Shrewsbury and Telford area. Will he give an undertaking that, whatever happens, that system will continue?
Baroness Randerson
The increased sensitivity to local needs which will be created by the reorganisation of the health service is to be welcomed, but in practice there will be more organisations involved which will need to co-operate. Does the Minister agree that this will need strong ministerial guidance for all affected organisations to follow if individual patients are not to suffer delays?
Lord Foulkes of Cumnock
Did I catch the Minister’s first answer right—did he say that it would be the new head of commissioning who would have this responsibility? Am I right in saying that this is the professor who was described by MPs as not having the experience necessary and not understanding the job of head of commissioning, and who was only approved by the committee in the House of Commons on the casting vote of the chairman? Is this the guy who is going to be responsible?
Earl Howe
My Lords, the chief executive-designate of the NHS Commissioning Board is Sir David Nicholson, who is currently chief executive of the NHS. He is not the gentleman to whom the noble Lord referred. He currently runs the NHS. Professor Malcolm Grant, to whom I think the noble Lord was referring, will be chairman of the NHS Commissioning Board Authority, in a non-executive capacity.
Baroness Thornton
My Lords, I think it is time that we brought Scotland, Wales and Northern Ireland into this Question, since they are actually part of the Question. So, on behalf of the rest of the UK, it is my understanding that essentially the same responsibilities and powers rest on the Secretary of State in England and the Ministers of Health in Scotland and in Wales. My question to the Minister is how do the Government intend to reconcile, manage and co-ordinate accountability to patients on cross-border concerns?
Earl Howe
My Lords, the accountability is currently, as the noble Baroness will know, fairly complicated. Patients who are resident in England are the responsibility of their local PCT and patients with a Welsh GP are the responsibility of the Welsh local health board. That leads to an anomaly where patients who are resident in England but who have a Welsh GP are the legal responsibility of two commissioners, while patients resident in Wales with an English GP are not the responsibility of any commissioner. The situation is much clearer in Scotland because patients resident in Scotland but registered with an English GP are the responsibility of Scotland, and that is very clear. None of that will change as a result of the Government’s reforms.
Legal System: Translation and Interpreting Services
(12 years, 6 months ago)
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Baroness Coussins
To ask Her Majesty’s Government what assessment they have made of the provision of translation and interpreting services for the legal system in the United Kingdom.
Baroness Coussins
My Lords, I beg leave to ask the Question standing in my name on the Order Paper, and I declare interests as chair of the All-Party Parliamentary Group on Modern Languages and honorary fellow of the Chartered Institute of Linguists.
The Minister of State, Ministry of Justice (Lord McNally)
My Lords, the Ministry of Justice has been looking at this matter for some time and has identified a number of issues that call for change. They include the limited number of linguists available for use, an inefficient and costly booking process, and concerns over the quality of service and complaint investigation. The ministry has therefore announced that it will be moving to a framework agreement with a single supplier. We anticipate that this will resolve current problems while saving the taxpayer at least £18 million a year on current spending.
Baroness Coussins
I thank the Minister for his reply, but would he be prepared to review the framework contract in the light of an independent study commissioned by the Association of Police and Court Interpreters, which predicts that the new arrangement is unsustainable and, far from saving £18 million a year, could end up costing £200 million a year? Secondly, is the Minister aware that more than half the existing number of qualified interpreters have refused to sign up with the new single supplier and take very substantial pay cuts, and that this situation could well result in the employment of less competent interpreters, to the detriment of witnesses, defendants and victims?
Lord McNally
No, we will not review the framework or the agreement that we have made. We have looked at the report—which, in any lobbying exercise, is quite legitimate—and examined the figures in it, but we do not believe that they stand up. We have always been clear that translation and interpretation services of the appropriate quality should be available, where they are required, for all those who come into contact with the justice system, while obtaining value for money for the public. Let us see how it settles. There are many threats and ideas that people are not going to sign up or that it will not work out. Obviously the noble Baroness is far more expert than me on this issue, but there is no doubt that the present system was not working, which is why the previous Administration initiated the inquiry, which has now culminated in this decision, as far back as 2009.
Lord Avebury
My Lords, in designing the new system, why was it decided to ignore existing professional qualifications and to sideline the National Register of Public Service Interpreters, with its established system of registration that requires not only an appropriate degree-level qualification but 400 hours of proven public service interpreting? Does my noble friend think that it is fair to make experienced and qualified interpreters and translators go through the hoops and pay for a new accreditation procedure that assumes that they have just come out of the sixth form?
Lord McNally
My Lords, we are not doing this for fun. We are doing it because the present accreditation system was not working and there was a lot wrong with it. That is why we set up a new register. There were faults in the old register in the quality of assessment and we believe that, starting as we are with a new system, a new register is the most effective way of guaranteeing quality.
Lord Kinnock
My Lords, no one is arguing for simple maintenance of the status quo. When over half of the qualified people in this profession have made it clear that they are unwilling to register with a new body under the new framework because it implies cuts of up to 70 per cent of their incomes, does the Minister not think that the Government are taking a huge risk by pursuing this course without further review and that it will result in loss of quality, compromise justice—which is worst of all—and could end up ultimately, as the professionals warn, costing much more and not reducing costs?
Lord McNally
The noble Lord has listed all the campaign slogans, as it were.
Lord McNally
The fact is that the old system was extraordinarily inefficient. Sometimes interpreters would get only one appointment in a week. Sometimes interpreters would not turn up, incurring costs to the court. Sometimes interpreters would subcontract to a totally unqualified interpreter. There were a lot of faults in the old system, which is why the previous Administration initiated the inquiry. Having looked at the outcome of that inquiry, we have adopted this new system, providing a new register with a single supplier. Let us see how it works. We have confidence that the system will work, that qualified interpreters will sign up to it and that they will get a volume of work that will give them a decent living.
Lord King of Bridgwater
Can my noble friend confirm, to reassure the British taxpayer, that when Mr Abramovich gives his evidence in Russian and this extensive trial stretches on in whatever language is chosen to conduct it, the cost will not fall on the British taxpayer?
Lord McNally
I will have to write to my noble friend. What I will say to him is that, if it is falling on the British taxpayer, I will put down an amendment to the LASPO Bill to prevent such an absurdity.
Health: Diabetes
(12 years, 6 months ago)
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Lord Collins of Highbury
To ask Her Majesty’s Government what plans they have to act on the nearly 50 per cent rise, since 2005, in the number of people diagnosed with diabetes in the United Kingdom.
The Parliamentary Under-Secretary of State, Department of Health (Earl Howe)
My Lords, the increasing prevalence of diabetes is one of the reasons we remain committed to the NHS health check programme. The programme has the potential to prevent over 4,000 people a year developing type 2 diabetes. We are also continuing to improve treatment and support for diabetes. Earlier this year, NICE published a diabetes quality standard, which provides an authoritative definition of good quality care for use by clinicians and commissioners.
Lord Collins of Highbury
I thank the Minister for his response. I agree that the biggest benefit of the NHS programme is the prevention of diabetes. However, despite its being in place for two years, very few people have heard of it or used it. Will the Minister explain what action he will take to ensure that the scheme is properly provided and promoted? Can he guarantee that such schemes will not be the first casualty of the proposed NHS reforms?
Earl Howe
My Lords, we are completely committed to the NHS health check programme, so I can reassure the noble Lord that we are clear that it has a major part to play. It is a very cost-effective way of both preventing and detecting early those who are at risk of diabetes or who may have recently contracted it. Health checks are part of the current operating framework. It is true that the figures for the first quarter of this year were a little disappointing, but PCTs are fully engaged in the process.
Lord McColl of Dulwich
My Lords, will the Minister acknowledge that the main cause of diabetes is the obesity epidemic, which is due to overeating? Could he suggest to the quango NICE that it withdraw its advice about having a balance between “calories in” and exercise, given that exercise has so little to do with the obesity epidemic? You have to run miles to take a pound of fat off.
Earl Howe
My Lords, my noble friend is to be congratulated on his campaign on this issue. Of course, I agree with him that if you are obese a reduction in “calories in” will make the most difference to regaining a healthy weight. He is absolutely right. If there is a respect in which NICE needs to amend its guidance, I am sure that it will be listening.
Baroness Pitkeathley
In view of the very well established connection between obesity and diabetes, and the associated resulting problems such as amputations, gangrene and so on, does the Minister consider that the Government’s policy on obesity is now adequate?
Earl Howe
My Lords, we are clear that obesity is a major problem—we have recently had a number of exchanges in this Chamber about it—and we are committed to promoting active lifestyles. Tackling obesity will support that, as will the health check. We are fully engaged in the Change4Life campaign, which raises awareness of the importance of maintaining a healthy weight and being physically active. The obesity challenge is not capable of being addressed or met by government alone; it is a matter for everybody—a matter for people taking responsibility for their own healthcare. Government and industry have a part to play in food formulation, as do the retail and catering trades. It is an effort across society that will beat obesity.
Baroness Masham of Ilton
My Lords, does the Minister agree that if people cut down on sugar and alcohol it would help? Would he agree that this is a worldwide problem?
Lord Rennard
My Lords, will the Minister undertake to look at the report published today by the Primary Care Diabetes Society on keeping people with diabetes out of hospital? Will he agree to look in particular at evidence suggesting that greater provision of insulin pumps or more use of bariatric surgery may be very cost effective to the NHS and, in the wider economic sense, a significant saving to the public purse rather than an expense?
Earl Howe
I shall certainly do so. In relation to insulin pumps, we know that more has to be done to increase the uptake, in line with NICE recommendations. The current operating framework highlights the need to do more to make these devices available. Bariatric surgery should be seen as a last resort, but in some cases it is the right option. It is not an easy option because surgery comes with risks, and anyone undergoing it needs to make significant lifestyle changes. But I am sure that my noble friend’s messages are well taken in the medical community.
Baroness Symons of Vernham Dean
My Lords, can the Minister tell us, given that there has been an extraordinary increase in the number of people suffering from diabetes in the past few years, how much of the increase is due to improved diagnosis of people who had diabetes and simply did not know that they had it?
Earl Howe
Certainly, we are picking up more cases of diabetes than we might have done in the past, but my advice is that approximately half the increase that we have seen is due to the changing age and ethnic group structure of the population and half due to higher levels of obesity.
Health and Social Care Act 2008 (Regulated Activities) (Amendment) Regulations 2011
(12 years, 6 months ago)
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Terrorism Prevention and Investigation Measures Bill
(12 years, 6 months ago)
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Baroness Hamwee
Baroness Hamwee
My Lords, I shall speak also to Amendments 55, 56, 59 and 63. I would add to that list if it gave noble Lords the opportunity to leave the Chamber before I get to the substantive part of my amendments. All of these amendments take us to the clauses in the Bill dealing with what are called enhanced terrorism prevention and investigation measures—that is, measures which the Secretary of State can introduce during a period between Parliaments when she,
“is satisfied, on the balance of probabilities”,
that individuals,
“have been, involved in terrorism-related activity”.
My amendments are particularly directed to the extent of those powers.
Clause 26(9) provides:
“A temporary enhanced TPIM order may make appropriate provision (including appropriate variations from the provision contained in the relevant provisions of this Act) in consequence of, or in connection with, the creation … of the enhanced TPIM power”.
As my noble friend the Minister is aware, my Amendment 54 is particularly directed to understanding what is meant by “appropriate provision”. What are the limits of appropriate provision in this context? Does it mean anything in this legislation? That does not seem logical to me because it is there anyway. Does it mean simply up to the boundaries of what is acceptable under the Human Rights Act? What does it mean? I appreciate that as well as the enhanced measure there is an enhanced standard of proof, “the balance of probabilities”, for introducing these provisions. I would have read this as a provision on how the measures would be applied—measures including residence, geographical area, association and communication—but the reference to variation from provisions,
“contained in the relevant provisions of this Act”,
makes me doubt that that can be the correct reading, so what is “appropriate provision” in this context?
On quite similar lines, Amendment 56 would amend Clause 26(11), which provides that,
“a temporary enhanced TPIM order includes … provision amending any enactment”.
That seems a very considerable power and I hope that the Minister can help your Lordships to understand what the Government have in mind. It is hard to think which measures are not in the Bill, apart from imprisonment in a conventional prison without trial or deportation which, while we are past the days of Botany Bay and cannot deport UK citizens, was something else that came to mind. I am pretty stuck as to what that subsection means.
Amendment 55 is not very elegant. It would, no doubt, have been easier if I had added some commas to it. However, it concerns what is elsewhere in the Bill relating,
“to standard TPIMs notices … orders”,
which are,
“the subject of standard TPIMs notices”,
and “measures”, which is the defined term meaning the measures that can be taken under a standard TPIMs notice. I want to be sure that the various procedures which apply to all of those apply to enhanced TPIMs. I think that is the case but I would like to have assurance on that.
Amendment 63, to which Amendment 59 is consequential, is about commencement and is of course a probing amendment. I am not suggesting postponing the arrangement—at any rate, not at this stage of the Bill—but asking the Minister whether he can give further information to the Committee about the timetable for dealing with the draft legislation for the separate enhanced TPIMs Bill. I know that he said at our last sitting that we will come to pre-legislative scrutiny of that in due course, essentially, although I do not recall which phrase he used. It would be more satisfactory to know what timetable we are working to, so that we all have a context for this Bill. I beg to move.
The Minister of State, Home Office (Lord Henley)
My Lords, I thank the noble Baroness, Lady Hamwee, for bringing forward these amendments, which are all essentially probing amendments. I commend her for so doing, as this is what the House does very well. I hope I can respond to and answer most of the points she has made in her four amendments—in fact, there are five, but they are in four batches.
If I start with Amendment 54, which is about the meaning of “appropriate”, I must first describe what subsection (9) does. It provides that a temporary enhanced TPIM order,
“may make appropriate provision (including appropriate variations from the provision contained in the relevant provisions of this Act) in consequence of, or in connection with, the creation, in accordance with this section, of the enhanced TPIM power”.
We believe that subsection (9) is essential to the clause. It allows the Secretary of State to make the consequent provisions to make sure that the enhanced TPIM regime functions properly, and it allows for equivalent provision to be made, to occur in paragraph 7 of Schedule 2 to the draft enhanced TPIM Bill.
This specifies that the operation of Schedule 6 to the TPIM Bill, which relates to the retention of DNA, is modified in order to accommodate the ETPIM regime. In particular, it takes account of the fact that the same individual may, at a different time, be subject to both an enhanced TPIM notice and the standard TPIM notice. I hope that my noble friend will accept that.
Amendment 55 would insert a new clause after subsection (10). The provisions of Clauses 26 and 27 already ensure that the order will apply the provisions of the Bill to the enhanced TPIM regime to the extent that it is appropriate. This includes all the nuts and bolts of the TPIM regime; for example the role of the court, and the way in which the TPIM notices are varied or revoked. The provisions that are not applied to the order are those which are not yet relevant. For example, an enhanced TPIM notice may not be extended for a year under the order, as the order, unlike the enhanced TPIM Bill, only lasts for 90 days and cannot be renewed.
Amendment 56 would delete the provision allowing the Secretary of State to amend any enactment under the order-making power. The noble Baroness stated that the amendment was not quite as elegant as it ought to be. She may have raised a point that we will certainly consider. At this stage, we want to see whether that provision is necessary; we will come back to the noble Baroness, have discussions with her, and possibly bring forward an amendment on Report.
Amendments 59 and 63, which are to be taken together, relate to commencement. I think the noble Baroness was really asking not so much about commencement but rather consideration of the draft legislation of the enhanced Bill. Obviously, it must be for the usual channels to decide what is appropriate, which committees are available, and so on. However, I am sure that with discussions between the usual channels—between the Government, the Opposition and others—we will come to the right solution as to how the enhanced TPIM Bill should be considered by this House and another place, or perhaps both together, while bearing in mind the resources available to both Houses. Different noble Lords will have different views on this, to which we will listen in due course, as will the usual channels, as always. I hope those explanations are sufficient for the noble Baroness but if they are not we can discuss them further. However, with that, I hope that the noble Baroness will feel able to withdraw her amendment.
Baroness Hamwee
My Lords, I thank the Minister for all of that. With regard to his reply on my first amendment, I shall have to take his word for it. That is my failure of concentration, not his failure of explanation. It is certainly a reply that deserves to be read in Hansard as it was quite technical.
On Clauses 26 and 27 applying to the extent that is appropriate and what is not appropriate, the Minister seemed to give examples rather than a complete reply. I am sure that his brief includes examples for him to give, which is fair enough, but it would be helpful to understand the extent of the point. May I ask him to let me have a complete answer in writing after Committee stage? These clauses are quite difficult to follow. I think I said on the previous day in Committee that a flow chart would be helpful in some cases. Given the powers that the Secretary of State would be granted, it would be appropriate to have as extensive an understanding of what is meant as possible.
Lord Henley
My Lords, whether I can provide a flow chart is one thing but I certainly promise to write to my noble friend so that we can sort these things out between now and Report. At this stage I will just give a commitment to write to her but that commitment does not necessarily extend to providing a flow chart.
Baroness Hamwee
My Lords, I do not think I was asking for a flow chart but I share the Minister’s wish to get this sorted out before Report. These issues do not lend themselves terribly easily to debate across the Floor of the Chamber. As regards the enhanced Bill, I hear what the Minister has to say. I thought it was worth continuing to ask the question. I beg leave to withdraw the amendment.
Lord Hunt of Kings Heath
Lord Hunt of Kings Heath
My Lords, I shall also speak to my Amendment 61. The heart of the Opposition’s concern with the Bill is the worry that the Home Secretary’s powers to deal with these very difficult and potentially very damaging cases are being weakened. Nowhere is this more evident than the central issue of relocation without consent. Relocation powers have proved to be extremely useful in disrupting terrorist activity, as has been confirmed by the police on a number of occasions. Indeed, as we discussed on the first day in Committee, the Home Secretary herself argued in May of this year—just a few months ago—in the case of CD that he needed to be removed from Greater London to protect the public from a terrorist attack.
Ministers have claimed that we need not worry because they will put greater surveillance measures in place of the existing legislative provisions. I again remind the Minister that, in evidence to the Public Bill Committee in the other place, the senior representative of the Metropolitan Police said that to get the resources required so that there will be sufficient surveillance measures in place, to get people trained, and to get the right equipment would take more than a year. The point I put to the Minister is this: it is simply not credible that the security environment has changed so dramatically in the past three to five months that the powers needed then are not needed now.
With the Olympic year coming up, can the Minister honestly say that the powers are needed less in the coming months than they were needed by this Home Secretary, who has used those powers on five occasions? The Minister has argued that the public can be protected by a less intrusive and more targeted regime. He has talked about the need for this regime to be complemented by additional resources for the police and security services, allowing more surveillance, and it is acknowledged that it will take time for those measures to be put into place.
My amendment offers a very helpful way forward for the Government. I am suggesting that the new measures are not brought in until 1 January 2013. This will allow us to get through the Olympic year using current legislative provisions. I am also suggesting that Parliament has some reassurance from the terrorism co-ordinator that the additional resources have been provided and, overall, that there can be confidence that the new provisions of this Bill, if enacted, and the additional measures that will need to be brought in in relation to surveillance are fully in place. I think that that is a very good offer from the Opposition; it will allow the Government to reassure both the security services and the police and to ensure stability over the next 15 months. The Government will be able to implement the new measures from 1 January 2013. Surely it will be worth the Government pausing over the next year to get us through the Olympics and then move to the introduction of these provisions. I beg to move.
Baroness Hamwee
My Lords, the noble Lord, Lord Hunt, says that relocation has been very useful in disrupting terrorism activity. The problem I have is that I do not know and I do not know whether he knows. He may well believe that that is the case, but I am not sure that any of us really knows. That has been a difficulty throughout the debate on the Bill.
I have a couple of points on the drafting of Amendment 61. It seems to me that it slightly muddles accountability. Is it not for the Home Secretary to take the decision on the resources and to take responsibility for what resources are applied, rather than it being an arrangement with the terrorism co-ordinator who, I take it, is the co-ordinator within the Metropolitan Police? I am slightly concerned that the amendment dilutes the responsibility of the Secretary of State. The terrorism co-ordinator of course has a role in this. We have all heard senior police officers say that they will do what they can within the resources provided to them, and they are very cautious about saying that they have enough resources.
My second point is to ask whether it is possible to identify precisely the right resources and deploy them. That could well be something of a moving feast; the resources required will vary from time to time. I of course understand the concerns that lie behind the noble Lord’s amendment, but I am not sure whether it is a practical way of satisfying us all and, indeed, the public.
Lord Pannick
My Lords, I am assuming that the Government are satisfied that the available resources are sufficient to maintain security in this country. If that is not the case, it would be very troubling indeed.
Lord Henley
I thank the noble Lord, Lord Pannick, for that comment. Yes, we are satisfied and it would be very troubling if we were not. Perhaps I may also deal with the brief point made by my noble friend Lady Hamwee about the terrorism co-ordinator. I am assuming that by that term used in the amendment the noble Lord, Lord Hunt, means a senior national co-ordinator for counterterrorism, but I shall let him address that in due course.
I am grateful for the intervention of my noble friend Lady Hamwee. She emphasised, first, the point of the role of Home Secretary and, secondly, a point that the noble Lord, Lord Hunt, himself addressed—that we should look not just at the Bill on its own but at the Bill plus the additional resources that have been promised. That is the most important matter before the House at this stage. It is not just the Bill that we are talking about, but the whole package that the Government have put forward.
I thank the noble Lord for his clear explanation of the concerns that lie behind his amendments. I appreciate that he raised the subject of relocation and the case of CD, in which, on that occasion, my right honourable friend the Home Secretary used relocation. However, as I have said, we must look at the package; and it is because the package will be in operation that we believe that relocation will not be so necessary in the future. As the House will be aware, there has been considerable debate over the past few weeks, here and in another place, about the arrangement for the transition from control orders to the new system of TPIMs. These amendments are an attempt to return to the issues raised by amendments tabled in another place and debated at some length on Commons Report.
The Opposition have been consistent in expressing their concern that the police and the Security Service may not be ready for the commencement of the Bill when the time comes. These amendments, in common with those tabled in another place, are intended to provide reassurance on that point by delaying commencement of the Bill or by making it subject to agreement with the police on the readiness of the significant additional resources that we are providing. However, as my noble friend Lady Hamwee said, that must, in the end, be a matter for the Home Secretary.
I accept that such concerns, particularly in the run-up to the Olympic Games, are well intended and are born of a concern to deal with matters that relate to the safety of the public. However, I am happy to confirm that I do not believe that they are necessary. As I said in response to the noble Lord, Lord Pannick, the public will be protected by the Bill because we are satisfied that there are sufficient resources available, including in relation to the date on which the Bill comes into force. We believe that the Bill plus the robust package provide the appropriate measures to protect the public, and alongside it there will be considerably increased resources to strengthen covert investigative capacity. We have repeatedly made it clear that for obvious reasons we are not able to provide details of that additional funding or its deployment, and that remains clear. However, we have also been clear—and I am pleased to confirm this again—that we have been in discussion with the police and the Security Service for some months on this matter, and arrangements will be in place to manage effectively the transition from control orders to TPIMs.
I hope that those assurances are sufficient for the noble Lord. If they are not, we will obviously come back to this matter on Report. However, I hope he will accept that we obviously cannot go into detail on what the resources are, and he would not expect me to do so. However, what I have said should be sufficient to allay his fears and I hope that he will therefore be prepared to withdraw his amendment.
Lord Hunt of Kings Heath
My Lords, I am grateful to the Minister, although I am disappointed by his response. I just refer the noble Baroness, Lady Hamwee, to the evidence given by Deputy Assistant Commissioner Stuart Osborne to the Public Bill Committee when he was asked about the effectiveness or not of relocation orders. He said:
“The relocation issue has been very useful for us being able to monitor and enforce at the current time. Without that relocation, and depending on where people choose to live, that could be significantly more difficult”.—[Official Report, Commons, Terrorism Prevention and Investigation Measures Bill Committee, 21/6/11; col. 5.]
I agree with the noble Lord, Lord Henley, that it is a question of the Bill plus resources. He said that he is confident that, alongside the provisions of the Bill, sufficient resources are being made available to the police and security forces. Of course, I can only accept the assurance that the noble Lord has given but I simply wonder whether he is wise to move to a new system within a very short period of the Olympics coming to this country. I wonder whether there is not a case for the implementation of this measure being delayed until after the Olympics. That really is the intention behind my amendment, which is meant to be helpful, and I hope that the Government will give it further consideration between now and Report. I beg leave to withdraw the amendment.
Lord Rosser
“( ) This Act expires at the end of the period of one year beginning with the day on which it commences.
( ) The Secretary of State may, by order, revive the Act if a draft of such an order is laid before and approved by an affirmative resolution of both Houses of Parliament.
( ) An order made by the Minister under this section is to be made by statutory instrument.”
Lord Rosser
My Lords, the purpose of this amendment is to ensure that the Bill and the TPIMs that it sets up require annual renewal, as is the case with the present control order legislation. That legislation is clear in its temporary nature and it has a sunset clause, which requires an annual vote in Parliament to consider whether the powers are still required. The Bill before us makes no provision for a yearly sunset clause but provides for a five-year limit, not requiring a first vote until the end of 2016 or early 2017 if its operative provisions are to continue and not expire.
Both your Lordships’ Constitution Committee and the Joint Committee on Human Rights have queried this provision in the Bill. The Constitution Committee questioned whether it was constitutionally appropriate for the extraordinary executive powers involved in TPIMs to remain in being for a lengthy period of time. The Joint Committee on Human Rights said that it was disappointed by the Government’s reluctance to expose their proposed replacement regime for control orders to the rigours of formal and post-legislative scrutiny, which annual renewal would entail. The Joint Committee was of the view that the TPIMs regime was less severe than the control orders regime but still felt that TPIMs remain,
“an extraordinary departure from ordinary principles of criminal due process”.
The Joint Committee also noted that the UN special rapporteur on the protection of human rights and fundamental freedoms while countering terrorism, in a recent report to the UN Human Rights Council, had observed:
“Regular review and the use of sunset clauses are best practices helping to ensure that special powers relating to the countering of terrorism are effective and continue to be required, and to help avoid the ‘Normalisation’ or de facto permanent existence of extraordinary measures”.
The Joint Committee recommended that the Bill should also,
“require annual renewal and so ensure that there is an annual opportunity for Parliament to scrutinise and debate the continued necessity for such exceptional measures and the way in which they are working in practice”.
In a recent letter responding to your Lordships’ Constitution Committee, the Minister in the other place claimed that five-yearly rather than annual renewal would allow the system to operate in a stable and considered way and would allow proper and detailed consideration to take place on whether the legislation was still required. Annual renewal also allows for proper and detailed consideration, and rather more frequently than once every five years. As for the assertion that five-yearly renewal will allow the system to operate in a stable and considered way, that rather suggests that the Government see TPIMs as not far short of a permanent arrangement, despite the exceptional executive powers, including the profound impact they can have on the liberty of some individuals. That is a key reason why annual renewal is necessary—precisely to ensure that these are regarded as temporary and not permanent measures.
We agree with the Joint Committee on Human Rights. Annual renewal is required for the current control order regime because of the considerable and exceptional executive power that it confers, most of which remains in the current Bill in respect of TPIMs. In addition, we now have the draft enhanced terrorism prevention and investigation measures Bill, which could be brought into being at short notice and which provides further extraordinary executive powers.
This Bill, like the control orders legislation, covers difficult issues relating to the rule of law. It provides powers to act in cases where prosecution is not possible but where, nevertheless, security concerns about the activities of a small number of individuals are such that it is felt that executive action has to be taken, which considerably restricts liberty through control orders, or in future through TPIMs, when the Secretary of State reasonably believes that the individual is or has been involved in terrorism-related activity. Whatever one’s views on the need for control orders or TPIMs, these are considerable and exceptional measures, and for that reason alone it is surely only right and appropriate that Parliament should have the opportunity and the duty to decide each year whether or not the situation remains such that these measures and the associated powers should continue in being or, instead, be allowed to expire. It is surely not appropriate, in view of the profound impact on the liberty of individuals of these exceptional measures and powers—the Minister accepted on Second Reading that they were exceptional—that an important check by Parliament on the exercise of those executive powers, and the continuing necessity for them, should be almost eliminated by permitting Parliament that opportunity to decide whether the situation remains such that they should continue, or be allowed to expire, only once every five years. I beg to move.
Lord Lloyd of Berwick
My Lords, I support the amendment, but I do not hold out much hope that it will do any good. It was different six years ago when the Conservative Party, and Lord Kingsland in particular, were in favour of relaxing, rather than strengthening, the 2005 Bill. Despite that, we argued the toss on renewal every year for six years and achieved precisely nothing. Now the Official Opposition are in favour of strengthening the Bill, and I see no reason to suppose that the Government will themselves be of that view—I hope not. I, therefore, suspect that in debating this matter every year for the next five years we will largely be wasting our breath, though I support the amendment for its symbolic value.
Lord Pannick
My Lords, I, too, support the amendment. I am rather more optimistic that it will do a great deal of good. I agree with what has been said by the noble Lord, Lord Rosser, about the need for an annual review because of the exceptional nature of these powers, and because of the need for Parliament to have the opportunity to consider such matters annually. But there is a further factor. An annual review will surely impose an important discipline on the Government, and this is an area where we inevitably need to trust the Government. It will require Ministers periodically to consider the need for these measures, what they can say to justify them in parliamentary debates and whether or not these measures need an amendment. This is an important discipline, particularly in a context where the factual circumstances that are said to justify these exceptional measures are not going to remain static for as long as the next five years.
Baroness Kennedy of The Shaws
My Lords, I support the amendment. Unlike the noble and learned Lord, Lord Lloyd, I do not think it is pointless. We should always remind ourselves that emergency measures have a way of seeping into the legal system as a whole. We have learned that over time. Often, things that are introduced as emergency measures end up remaining on the statute book for far too long. The fact that we come together and annually review a matter—even if we do not manage to persuade the Government—does mean that the matter is before us, and we are still talking about something that is being used as an exception to the rule. I therefore urge those who are listening to see why this is important, and that we do have the annual review that we have always had in the past.
Lord Faulks
My Lords, these provisions followed a lengthy counterterrorism review and represent the views of the Government as to where the line should be drawn between the necessary powers, by way of TPIMs, and the liberty of the individual. This legislation has been through the other place and is going through your Lordships’ House in a thoroughly orthodox way, and the provisions are being carefully scrutinised. TPIMs contain a considerable number of safeguards, which have already been discussed in Committee, and they reflect a considered compromise between the various arguments. The Bill does not represent a response to the immediate crisis, as the 2005 position did, and has not gone through Parliament by way of accelerated procedures; it represents the result of lessons learnt.
The provisions can be repealed by an order-making power or in the way that any other legislation is repealed. It is tempting with extraordinary powers—and I readily concede that they are extraordinary powers—to suggest that they should be under more or less constant scrutiny. But where the Bill represents a considered response, five years is an appropriate time in which Parliament and the Government can consider this particular take on a particularly difficult situation. At that juncture, the Government and Parliament can think again. For the moment, as the noble and learned Lord, Lord Lloyd suggested, squabbling every year about this would not improve matters, and we should rest with the provisions as they are.
Baroness Hayman
My Lords, I cannot agree with the noble Lord, Lord Faulks, that an annual review would simply be squabbling about the provisions of this Bill. I am tempted to speak, despite my resolution not to speak on controversial issues for several months after leaving the Woolsack, because the issue of a sunset clause was one on which in 2005 I abandoned loyalty to my Government and put forward the amendments to have a sunset clause, which eventually transmuted into the annual review of the Prevention of Terrorism Act.
I would be saddened if these measures, which, as the noble Lord, Lord Faulks, said, are less draconian in some ways than control orders and represent a considered view, were considered the best that we can do. I am not certain about that, but we will have further debates on Report on some of those issues. I wonder whether that exonerates us from the responsibility of devoting what is not a great deal of time every year to looking at these extraordinary provisions in both Houses of Parliament. It seems to me to be a proper recognition of the retreat from some of the processes that we have held dear for centuries in this country in terms of the administration of the criminal justice system. I do not argue against the premise or fact that there is a need or problem that is not easily solved by the normal criminal justice system; I argue that, because of the extraordinary nature of these measures, it is incumbent on us as parliamentarians to keep them under review. I do not think that that is a dreadful burden.
However, I am delighted to see the opposition Front Bench such enthusiastic supporters of measures which I remember they were not quite so enthusiastic about when I proposed them six years ago.
Baroness Butler-Sloss
I strongly support the speech of the noble Baroness, Lady Hayman. It seems to be highly desirable, to put it at its very least, that, as problems change, there should be an annual review of the existing law dealing with terrorism. Like all previous speakers, I, too, support the amendment.
Lord Henley
My Lords, I am grateful to all noble Lords who have spoken in this debate. I have three brief points to make, which will take me a little time, about why we do not accept the amendment moved by the noble Lord, Lord Rosser. First, we believe that renewal every five years strikes the right balance—a word I have used on many occasions; secondly, I believe that annual renewal is unnecessary, and I shall return to that in more detail; and, thirdly, there are other means by which the Bill can be amended or repealed.
First, I thank my noble friend Lord Faulks for his comments reminding the House that the provisions that face us follow a very lengthy review of all our counterterrorism provisions by the Government, with the announcements earlier in the year and consideration of this Bill, in due course, in both Houses. This is very different from what happened with the 2005 Act. We believe that renewal every five years strikes the right balance and reflects the need to build in effective safeguards to ensure that the powers do not remain in force longer than necessary. It also reflects the competence of Parliament to apply intense scrutiny to legislation and to arrive at a position when it will not need to be reviewed annually. We are moving to a position where we hope that each Parliament will last five years, so each new Parliament will have the opportunity to debate this in the context of the situation at the time and take its own view. That is in line with the length of Parliaments, as I have said, provided by the Fixed-term Parliaments Act.
Secondly, I believe that annual review is unnecessary. I listened to the noble and learned Lord, Lord Lloyd, say that he was wasting his breath. He never wastes his breath in this House. I have been here for many years and I have listened to him with great devotion on many occasions. I do not always agree with him, but he is not wasting his breath. I appreciate that the noble Lord, Lord Pannick, is more optimistic and feels that an annual debate provides a better opportunity for these things, as do the noble Baroness, Lady Hayman, the noble and learned Baroness, Lady Butler-Sloss, and the noble Baroness, Lady Kennedy, a copy of whose book Just Law—however you pronounce it—sits in my room in the Home Office to this day, and I will always have it there to be reminded about how I should go about my duties. However, I have to say that I do not agree with her, or with others, on this occasion about whether annual renewal is necessary.
The important thing is to distinguish the process we are going through on this occasion from the process we went through following the 2005 Act. This Bill will be subjected to full parliamentary scrutiny with the usual timetable—we still have not completed it in this House—allowing for a settled position to be reached. In contrast, the 2005 legislation was, as the noble Lord will remember, rushed through with very little opportunity for debate. The noble Baroness, Lady Hayman, reminded the House of her role in that. We believe that that makes annual renewal an appropriate safeguard for the 2005 Act, but one that we do not think is necessary for this Act.
My third point is that there are also other means by which the Bill can be amended or replaced. The noble Lord, Lord Rosser, stressed that these powers seem to be permanent, but I ask him to look very carefully at Clause 21(2) which states that:
“The Secretary of State may, by order made by statutory instrument … repeal the Secretary of State’s TPIM powers”.
It is unusual to give the Secretary of State the power to repeal something, but that provision allows her, if she feels they are no longer necessary, at any stage to repeal and take away the powers that she has given herself. Again, I make this point in terms of how, if it becomes clear that the powers should be changed, the legislation can be amended by Parliament at any time in the usual way.
I appreciate that many noble Lords feel that an annual debate would be preferable to one every five years. It happens on other occasions. I think there is some financial Motion that we debate once a year under EU rules following some vote in this House, and I have noticed, and I think other noble Lords will have noticed, that the number of participants in that debate seems to decline each year as time goes past, so I wonder whether a debate every year is necessary, given the fact that this Bill has been given full coverage in both Houses.
I appreciate that others may feel differently but, at this stage, I think that what we are offering and have brought forward as a concession in another place—a debate once each Parliament—is appropriate and will be sufficient, given the other safeguards in the Bill. I hope therefore that the noble Lord, Lord Rosser, will feel that on this occasion he can withdraw his amendment.
Lord Rosser
My Lords, I thank the Minister for his response. I also thank all noble Lords who have taken part in this debate for the contributions they have made based, I have to say, on considerably more experience and knowledge of the issues involved than I can claim to possess. Perhaps I should also congratulate the noble Baroness, Lady Hayman, on her determination on this point with the previous Government.
There is no disagreement that this amendment raises a key issue of real significance. It is about parliamentary oversight of extraordinary and exceptional executive powers which directly affect to a considerable degree the freedom and liberty of a small number of individuals whom the Secretary of State reasonably believes are or have been involved in terrorist activity. That oversight, involving human rights and civil liberties, cannot be properly exercised if done only once every five years. In reality, the Bill would be amended or dropped in the intervening years only if it were the Government, not Parliament, that wanted to change the legislation. That is surely a fact of life.
Education Bill
(12 years, 6 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
17:04 - Division on Amendment 84A - Ayes: 174 / Noes: 234 - Amendment 84A disagreed.
17:32 - Division on Amendment 84B - Ayes: 184 / Noes: 218 - Amendment 84B disagreed.
19:04 - Division on Amendment 89ZZAA - Ayes: 140 / Noes: 175 - Amendment 89ZZAA disagreed.
Lord Hill of Oareford
“(11) In section 182 of EIA 2006 (parliamentary control of orders and regulations)—
(a) in subsection (2), after paragraph (a) insert—“(aa) regulations to which subsection (2A) applies,”;(b) after subsection (2) insert—“(2A) This subsection applies to regulations made under section 125(1A) (power to prescribe institutions exempt from inspection), apart from the first regulations to be made under that subsection.”;
(c) in subsection (3), after paragraph (a) insert—“(aa) regulations to which subsection (2A) applies,”.”
Lord Hill of Oareford
“ After section 16 insert—
“16A Publication of proposals
(1) The appropriate authority may not make an order under section 16(1) or (3) unless the authority has published a draft of the proposed order, or of an order in substantially the same form, by such time and in such manner as may be prescribed.
(2) A draft proposal or order in respect of an institution which is maintained by a local authority may not be published without the consent of the governing body and the local authority.
(3) In this section “the appropriate authority” means—
(a) in relation to a proposal or order in respect of an institution in England, the Secretary of State;(b) in relation to a proposal or order in respect of an institution in Wales, the Welsh Ministers.””
The Parliamentary Under-Secretary of State for Schools (Lord Hill of Oareford)
My Lords, I will speak to the government amendments in this group. As noble Lords may be aware, in October 2010 the Office for National Statistics announced its decision to reclassify FE colleges to the public sector for the purposes of the national accounts. This reclassification would impose heavy new administrative burdens on colleges, and could significantly affect their ability to make their own strategic and operational decisions.
If FE colleges were exposed to the full rigours of the government expenditure regime, they would lose the flexibility they currently have to phase expenditure between different financial years; they would need to work within a financial year that does not line up with their academic year; and it is likely that the very freedoms we are introducing to enable them to borrow without seeking permission would need to be taken away from them, and even tighter constraints introduced. These and other controls would all act as barriers to colleges growing, innovating and developing as we would wish them to do.
I am very grateful to my noble friend Lady Sharp for raising this important issue in Committee. Recent feedback from the ONS indicated that the powers held by the Secretary of State in two areas were indicative of public sector control. We have looked again at these areas to see whether changes could be made to secure private sector classification for colleges, something that I know successive Governments have wished to retain.
The first area is Secretary of State control over the instrument and articles of the governance of colleges. I am sure all noble Lords would agree that every college should have clear, transparent and robust governance arrangements. However, we believe that this can be achieved without Secretary of State control. The government amendments in this group remove the powers of the Secretary of State—or in the case of sixth form colleges, the YPLA—to alter college instrument and articles and place these powers with the college itself. For most colleges this change will make no difference, but it will enable colleges that want to develop and improve their governance in response to the needs of their students, employers and local community to do so. We have retained the essential elements that all instruments and articles must contain in new Schedule 4, which is set out in Amendment 84ZL.
The second area is the Secretary of State’s control over the closure of colleges, known as dissolution. Presently, only the Secretary of State can dissolve a college. The government amendments remove this power from the Secretary of State and give colleges control over their own dissolution. These amendments, and the regulations that will be laid in support of them, include a number of safeguards to ensure that any dissolution decision is taken only once all those affected—staff, students and the local community—have been consulted, and that the process is undertaken in a clear and transparent way, recognising that colleges are providers of an important public service.
Existing legislation provides the state with a legal mechanism to tackle, in extremis, failure in colleges, and this will be retained. In cases where there is evidence of significant mismanagement in colleges, the Secretary of State will be able to exercise his powers of intervention to direct the college to dissolve itself and transfer its property, rights and liabilities to another provider. This action will be taken only once all other steps have been taken to secure improvements, where it is necessary for the Government to intervene as a matter of last resort, to protect students.
I wrote today about government “correcting” Amendments 84ZBA and 84ZN, which correct the provision in Schedule 12 that repeals the duty on colleges to have regard to guidance on consultation with students and employers in England, while retaining this in Wales.
It may help if I inform noble Lords of discussions between the noble Baroness, Lady Jones of Whitchurch, and my honourable friend, the Minister for Further Education, Skills and Lifelong Learning, John Hayes MP, on her Amendment 84ZLA, which would retain requirements for staff and student governors. On behalf of my honourable friend, I thank the noble Baroness and the noble Lord, Lord Young of Norwood Green, for taking the time to meet us. I apologise to them for bringing these amendments forward at a later stage than we would have liked.
The Government have brought forward these changes to support our case for the private sector classification for colleges, in accordance with the policy of successive Governments. It was not our intention to encourage colleges to remove staff or student governors from college governance arrangements. I know that colleges greatly value the contribution that those governors make.
Having listened to the arguments that were put to him by the noble Baroness, Lady Jones of Whitchurch, my honourable friend Mr Hayes and I have spoken further. We have decided that the Government will return at Third Reading with their own amendment, which will give effect to what the noble Baroness’s amendment seeks to achieve. With that assurance, I hope that the noble Baroness will feel able to withdraw the amendment.
Baroness Jones of Whitchurch
My Lords, as the Minister has indicated, we have tabled Amendment 84ZLA in this group. Its aim was to reinstate the rights of students and staff to be represented on FE college governing bodies. As the Minister has described, last night we had a useful meeting on this issue with John Hayes. I think it was acknowledged at that meeting that the proposals had arrived rather late and that there had not been time to consult the stakeholders effectively on the implications of these changes.
I am therefore grateful that the Minister has agreed to reconsider this issue and to come back with a form of words that will reinstate the right to student and staff representation at Third Reading. On this basis, we are prepared to withdraw Amendment 84ZLA. We of course reserve the right to return to this issue at Third Reading should we feel that the new proposals are lacking in any way, but I am sure that that will not be the case. For the moment, I thank the Minister for the progress made on this issue.
In the mean time, we are still absorbing the wider implications of these governance changes. I should be grateful if the Minister could clarify whether one consequence, intended or otherwise, is that governors of FE colleges will be able to be paid in the future. If he does not have that information to hand, perhaps he could write to me.
Moving briefly to the issues covered by the noble Baroness, Lady Brinton, in Amendment 83, this issue was well aired in Grand Committee and very much supported by us at that time. As the noble Baroness, Lady Sharp, said during the earlier debate, colleges should be,
“a dynamic nucleus within their communities”.—[Official Report, 12/9/11: col. GC 141].
FE colleges have worked hard in the last decade to advance strong partnerships with local businesses, and have the inside track on local employment markets. Their links with local youth services are now more important than ever, as resources shrink.
The Association of Colleges has argued that while it highly prizes the work that local colleges achieve in their communities, this work will carry on whether or not there is a duty to do it. The Minister said something similar in Grand Committee. I would turn this argument on its head; if the work is so prized and so effective, should we not take the precaution of leaving it in the original legislation to ensure that it continues, rather than sending a signal that it is no longer a requirement on colleges, which might otherwise develop different priorities?
With these comments, I look forward to the Minister’s response to the debate.
Baroness Sharp of Guildford
My Lords, I have two amendments in this grouping, Amendments 83 and 84. They do indeed pick up the issue that we spoke about in Committee, which is the duty on the part of colleges to promote the well-being of the local area.
I thank the Minister for bringing forward this raft of amendments. As he knows, I am chairing a commission on behalf of NIACE, the AoC and the 157 Group, which is looking into the role of colleges in their communities. The issue of the reclassification by ONS cropped up in our deliberations on this commission. Our intention is to promote the role of colleges. As the noble Baroness says, we have used the term “dynamic nucleus within their communities”—they should be proactive in developing partnerships and in promoting well-being and community cohesion within their communities. Since that is the case, we are very anxious that they should not be inhibited from this by a statistical classification, and therefore we have been backing the moves made by the department here. I put down some rather naive amendments in Committee in order to pave the way for this, and I am delighted that we have—I hope—managed to come forward with a way that prevents this reclassification.
In relation to my own amendments, I have spoken at some length both with the AoC and with the department about this issue. As I have suggested, the report, which is going to be presented at the AoC conference later this month, will in fact suggest a wider role for colleges within the community, and I think there is a fair amount of good will towards the promotion of this role. In the light of that, I have decided that it would not be appropriate at this time to press my amendments. There is good will on all parts, and the assumption is that colleges will be promoting the well-being of their local area as part of what they will be doing. There is no question of that, but it does not necessarily need to be in the Bill, so, as I say, I shall not press my amendments today.
Lord Hill of Oareford
My Lords, I thank my noble friend Lady Sharp for raising the issue of promoting well-being, and take the opportunity to thank her formally for the work she is doing at the helm of the Government’s commission on the role of colleges in their communities. As she has just said, colleges contribute significantly to the social and economic well-being of their local areas, not only through the education, skills and employment that they provide but through their partnerships and relationships with other bodies in their local areas. I am grateful to her, and look forward to the report that she was talking about, which she is launching at the Association of Colleges conference later in the month.
I am grateful to the noble Baroness, Lady Jones of Whitchurch, for her remarks. On her specific question about remuneration, I understand that colleges need to apply, as now, for exceptional approval for the remuneration of governors for their services as members of the governing body. The change is that they would be treated in line with other charities, and would have to apply to the Charity Commission rather than to the Secretary of State. There is no general power in charity law for trustee boards to make remuneration payments, so permission would be granted only in exceptional circumstances, as the commission has a general expectation that charity assets should be used directly for the purposes of the charity.
The amendments that the Government have tabled, as I think has been recognised, have been made within the context of a changed landscape, in which government and the sector are working together. It has been the policy of successive Governments since the inception of FE corporations in 1992 that colleges should not have the financial and control requirements associated with public sector classification. Our amendments seek to strike the right balance between securing that classification while safeguarding students and public investment in the sector. With the assurance that I have given the noble Baroness, Lady Jones of Whitchurch, I hope noble Lords generally will feel that we have struck such a sensible balance.
Lord Hill of Oareford
“( ) In subsection (4)(c), for “27” substitute “27C or 33P”.”
Lord Hill of Oareford
“ In section 20 (constitution of further education corporation and conduct of further education institution), for subsection (2) substitute—
“(2) Instruments of government and articles of government of further education corporations in England—
(a) must comply with the requirements of Part 2 of Schedule 4, and(b) subject to that, may make such other provision as may be necessary or desirable.(2A) Instruments of government and articles of government of further education corporations in Wales—
(a) must comply with the requirements of Part 3 of Schedule 4, and(b) subject to that, may make any provision authorised to be made by that Part of that Schedule and such other provision as may be necessary or desirable.”For section 22 substitute—
“22 Subsequent instruments and articles: England
A further education corporation in England may modify or replace their instrument of government or articles of government.22ZA Subsequent instruments and articles: Wales
(1) Subject to subsections (2) and (3), the Welsh Ministers may—
(a) if a further education corporation in Wales submits a draft of an instrument of government to have effect in place of their existing instrument, by order make a new instrument of government in the terms of the draft or in such terms as they think fit, and(b) if such a corporation submits draft modifications of an instrument made under paragraph (a), by order modify the instrument in the terms of the draft or in such terms as they think fit.(2) The Welsh Ministers must not make a new instrument otherwise than in the terms of the draft, or modify the instrument otherwise than in the terms of the draft, unless they have consulted the corporation.
(3) If the institution conducted by a further education corporation mainly serves the population of England, or receives financial support from the Chief Executive of Skills Funding, the Welsh Ministers must consult the Chief Executive of Skills Funding before making an order under subsection (1).
(4) The Welsh Ministers may by order modify, replace or revoke any instrument of government or articles of government of any further education corporation in Wales.
(5) An order under subsection (4) may relate to all further education corporations in Wales, to any category of such corporations specified in the order or to any such corporation so specified.
(6) Before making an order under subsection (4), the Welsh Ministers must consult—
(a) the further education corporation or (as the case may be) each further education corporation to which the order relates, and(b) the Chief Executive of Skills Funding, if the institution conducted by the corporation or (as the case may be) any corporation to which the order relates mainly serves the population of England, or receives financial support from the Chief Executive of Skills Funding.(7) A further education corporation in Wales may, with the consent of the Welsh Ministers—
(a) make new articles of government in place of their existing articles, or(b) modify their existing articles.(8) The Welsh Ministers may by a direction under this section require further education corporations in Wales, any class of such corporations specified in the direction or any particular further education corporation so specified—
(a) to modify, replace or revoke their articles of government, or(b) to secure that any rules or bye-laws made in pursuance of their articles of government are modified, replaced or revoked,in any manner so specified.(9) Before giving a direction under this section, the Welsh Ministers must consult the further education corporation or (as the case may be) each further education corporation to which the direction applies.”
“ For section 27 substitute—
“27 Proposals for dissolution of further education corporations: England
(1) This section applies if a further education corporation in England propose that the corporation should be dissolved.
(2) The corporation must publish details of the proposal, and such other information as may be prescribed, in accordance with regulations.
(3) The corporation must consult on the proposal, and take account of the views of those consulted, in accordance with regulations.
27A Dissolution of further education corporations: England
(1) This section and section 27B apply if, after complying with section 27, a further education corporation in England resolve that the corporation should be dissolved on a specified date.
(2) “The dissolution date” means the date specified in a resolution under subsection (1).
(3) The corporation must notify the Secretary of State of the resolution and the dissolution date as soon as reasonably practicable.
(4) The corporation are dissolved on the dissolution date.
27B Dissolution of further education corporations: England: transfer of property, rights and liabilities
(1) At any time before the dissolution date, the corporation may transfer any of their property, rights or liabilities to such person or body, or a person or body of such description, as may be prescribed.
(2) The corporation may do so only with the consent of the person or body concerned.
(3) A transfer under subsection (1) has effect on the dissolution date.
(4) Subsection (5) applies if a person or body prescribed, or of a description prescribed, under subsection (1) is not a charity established for charitable purposes which are exclusively educational purposes.
(5) Any property transferred to the person or body must be transferred on trust to be used for charitable purposes which are exclusively educational purposes.
27C Dissolution of further education corporations: Wales
(1) Subject to the following provisions of this section, the Welsh Ministers may by order provide for—
(a) the dissolution of a further education corporation in Wales, and(b) the transfer to any person mentioned in subsection (2) or (3) of property, rights and liabilities of the corporation.(2) Such property, rights and liabilities may, with the consent of the person or body concerned, be transferred to—
(a) any person appearing to the Welsh Ministers to be wholly or mainly engaged in the provision of educational facilities or services of any description, or(b) any body corporate established for purposes which include the provision of such facilities or services.(3) Such property, rights and liabilities may be transferred to a higher education funding council.
(4) Where the recipient of a transfer under an order under this section is not a charity established for charitable purposes which are exclusively educational purposes, any property transferred must be transferred on trust to be used for charitable purposes which are exclusively charitable purposes.
(5) An order under this section may apply section 26 with such modifications as the Welsh Ministers consider necessary or desirable.
(6) Before making an order under this section in respect of a further education corporation, the Welsh Ministers must consult—
(a) the corporation, and(b) the Chief Executive of Skills Funding, if the institution conducted by the corporation mainly serves the population of England, or receives financial support from the Chief Executive of Skills Funding.””
“ For section 29 substitute—
“29 Government and conduct of designated institutions
(1) This section applies to a designated institution, other than—
(a) an institution conducted by a company, or(b) an institution conducted by an unincorporated association, if the order designating the institution provides for its exemption.(2) For each designated institution to which this section applies, there is to be—
(a) an instrument providing for the constitution of a governing body of the institution (to be known as the instrument of government), and(b) an instrument in accordance with which the institution is to be conducted (to be known as the articles of government).(3) In sections 29A to 29C—
“instrument” means an instrument of government or articles of government;
“regulatory instrument”, in relation to an institution, means—
(a) an instrument of government or articles of government, or(b) any other instrument relating to or regulating the institution. 29A First post-designation instruments and articles of designated institutions: England and Wales
(1) The first post-designation instrument and articles of government of a designated institution to which section 29 applies must each comply with subsection (3) and (if the institution is in Wales) subsection (6).
(2) The “first post-designation instrument and articles of government” of a designated institution are the first instrument of government and articles of government that the institution has after the designation takes effect.
(3) The instrument must meet one of the following requirements—
(a) the instrument was in force when the designation took effect and is approved for the purposes of this section by the appropriate authority;(b) the instrument—(i) is made in pursuance of a power under a regulatory instrument or (where there is no such power) by the governing body of the institution, and(ii) (in either case) is approved for the purposes of this section by the appropriate authority;(c) the instrument is made by the appropriate authority by order.(4) An instrument made by the governing body under subsection (3)(b) or the appropriate authority under subsection (3)(c) may replace wholly or in part an existing regulatory instrument.
(5) Before making an instrument under subsection (3)(c), the appropriate authority must, so far as it appears practicable to do so, consult—
(a) the governing body of the institution, and(b) where there is power under a regulatory instrument to make the instrument, and that power is exercisable by persons other than the governing body of the institution, the persons by whom the power is exercisable.(6) If the institution is in Wales, provision made by the instrument in relation to the appointment of members of the governing body must take into account the members who may be appointed by the Welsh Ministers under section 39 of the Learning and Skills Act 2000.
(7) In this section “the appropriate authority”—
(a) in relation to an institution in England, means the Secretary of State;(b) in relation to an institution in Wales, means the Welsh Ministers.29B Changes to instruments and articles: England
(1) This section applies to a designated institution in England which is an institution to which section 29 applies.
(2) The governing body of the institution may modify or replace its instrument of government and articles of government.
(3) The instrument of government and articles of government (as modified or replaced)—
(a) must comply with the requirements of Part 2 of Schedule 4, and(b) subject to that, may make such other provision as may be necessary or desirable.29C Changes to instruments and articles: Wales
(1) This section applies to a designated institution in Wales which is an institution to which section 29 applies.
(2) Subject to subsection (3), the governing body of the institution may modify, replace or revoke its instrument of government and articles of government if —
(a) the instrument falls within section 29A(3)(a),(b) the instrument was made by the governing body, or(c) the instrument was made in pursuance of a power under a regulatory instrument, where there is no other power to modify it. (3) An instrument approved under section 29A(3)(a) or (b) by the Welsh Ministers may not be modified, replaced or revoked without the consent of the Welsh Ministers.
(4) The Welsh Ministers may by order modify, replace or revoke the instrument of government or articles of government of the institution.
(5) Before making an order under subsection (4), the Welsh Ministers must, so far as it appears practicable to do so, consult—
(a) the governing body of the institution, and(b) where there is power under a regulatory instrument to make the instrument, and that power is exercisable by persons other than the governing body of the institution, the persons by whom the power is exercisable.””
“ In section 30 (special provision for certain institutions), in subsection (1) for “section 29” substitute “sections 29 to 29C”.”
“( ) in subsection (6)(e)(ii), for “27” substitute “27C or 33P”;”
Lord Hill of Oareford
“ In section 33I(2) (instrument and articles of government of sixth form college corporations)—
(a) in paragraph (a), after “requirements of” insert “Part 2 of”;(b) for paragraph (b) substitute—“(b) subject to that, may make such other provision as may be necessary or desirable.”
“ For section 33L substitute—
“33L Changes to instruments and articles
(1) A sixth form college corporation may modify or replace their instrument of government or articles of government.
(2) A sixth form college corporation to which section 33J applies may do the things mentioned in subsection (1) only with the consent of the trustees of the relevant sixth form college.”
For section 33N substitute—
“33N Proposals for dissolution of sixth form college corporations
(1) This section applies if a sixth form college corporation propose that the corporation should be dissolved.
(2) The corporation must publish details of the proposal, and such other information as may be prescribed, in accordance with regulations.
(3) The corporation must consult on the proposal, and take account of the views of those consulted, in accordance with regulations.
33O Dissolution of sixth form college corporations
(1) This section and section 33P apply if, after complying with section 33N, a sixth form college corporation resolve that the corporation should be dissolved on a specified date.
(2) “The dissolution date” means the date specified in a resolution under subsection (1).
(3) The corporation must notify the Secretary of State of the resolution and the dissolution date as soon as reasonably practicable.
(4) The corporation are dissolved on the dissolution date.
33P Dissolution of sixth form college corporations: transfer of property, rights and liabilities
(1) At any time before the dissolution date, the corporation may transfer any of their property, rights or liabilities to such person or body, or a person or body of such description, as may be prescribed, subject to subsection (4).
(2) The corporation may do so only with the consent of the person or body concerned.
(3) A transfer under subsection (1) has effect on the dissolution date.
(4) In the case of a sixth form college corporation to which section 33J applies, any property held by the corporation on trust for the purposes of the relevant sixth form college must be transferred to the trustees of the relevant sixth form college.
(5) Subsection (6) applies if a person or body prescribed, or of a description prescribed, under subsection (1) is not a charity established for charitable purposes which are exclusively educational purposes.
(6) Any property transferred to the person or body must be transferred on trust to be used for charitable purposes which are exclusively educational purposes.
(7) Subsection (6) does not apply to property transferred to the person or body by virtue of subsection (4).””
“17 Section 49A (guidance about consultation with students and employees), as it has effect in relation to England, is repealed.”
“ Section 51 (publication of proposals) is repealed.”
“( ) In subsection (7), after “include” insert “— (a)” and at the end insert—
“(b) a direction requiring a governing body to make a resolution under section 27A(1) for the body to be dissolved on a date specified in the direction.(7A) A governing body to which a direction such as is mentioned in subsection (7)(b) is given is to be taken for the purposes of section 27A(1) to have complied with section 27 before making the resolution required by the direction.””
“( ) In subsection (7), after “include” insert “— (a)” and at the end insert—
“(b) a direction requiring a governing body to make a resolution under section 33O(1) for the body to be dissolved on a date specified in the direction.(7A) A governing body to which a direction such as is mentioned in subsection (7)(b) is given is to be taken for the purposes of section 33O(1) to have complied with section 33N before making the resolution required by the direction.””
“ In section 88 (stamp duty)—
(a) for “27” substitute “27B, 27C”;(b) for “33N” substitute “33P”.In section 88A (stamp duty land tax)—
(a) for “27” substitute “27B, 27C”;(b) for “33N” substitute “33P”.”
“ (1) Section 89 (orders, regulations and directions) is amended as follows.
(2) In subsection (2)—
(a) for “22, 29(6) and (8)” substitute “22ZA(1) and (4), 29A(3)(c), 29C(4)”;(b) after “33A(5)(b)” insert “33J(2), 33K(1),”;(c) omit “or section 33L”.(3) In subsection (3), after “subsection (3A)” insert “or (3B)”.
(4) After subsection (3A) insert—
“(3B) An order falls within this subsection if—
(a) it is an order revoking (wholly or in part) an order under section 15 or 16 and is made by virtue of section 27A(4), or(b) it is an order revoking (wholly or in part) an order under section 33A, 33B or 33C and is made by virtue of section 33O(4).””
Lord Hill of Oareford
(a) after the definition of “further education” insert—““further education corporation in England” means a further education corporation established to conduct an institution in England;
“further education corporation in Wales” means a further education corporation established to conduct an institution in Wales;”;
(b) ”
(a) after the entry for “further education corporation” insert—
“further education corporation in England | section 90(1) |
further education corporation in Wales | section 90(1)” |
Lord Hill of Oareford
“ For Schedule 4 substitute—
“SCHEDULE 4Instruments and articles of governmentPart 1General1 In this Schedule—
“instrument” means an instrument of government or articles of government;“the institution” means—(a) in the case of a further education corporation, the institution which the corporation are established to conduct;(b) in the case of the governing body of a designated institution, the institution;(c) in the case of a sixth form college corporation, the relevant sixth form college.Part 2England2 This Part applies in relation to—
(a) a further education corporation in England;(b) the governing body of a designated institution in England;(c) a sixth form college corporation. 3 In this Part “the body” means—
(a) in the case of a further education corporation or a sixth form college corporation, the corporation;(b) in the case of a governing body, the governing body.4 An instrument must provide for—
(a) the number of members of the body,(b) the eligibility of persons for membership, and(c) the appointment of members.5 (1) An instrument must make provision about the procedures of the body and the institution.
(2) In particular, an instrument must specify how the body may resolve for its dissolution and the transfer of its property, rights and liabilities.
6 (1) An instrument must make provision for there to be—
(a) a chief executive of the institution, and(b) a clerk to the body.(2) An instrument must make provision about the respective responsibilities of the body, the chief executive and the clerk.
(3) The responsibilities of the body must include—
(a) in the case of a sixth form college corporation to which section 33J applies, the preservation and development of the educational character and mission of the institution and the oversight of its activities;(b) in the case of any other sixth form college corporation, a further education corporation or a governing body, the determination and periodic review of the educational character and mission of the institution and the oversight of its activities;(c) in any case, the effective and efficient use of resources, the solvency of the institution and the body and the safeguarding of their assets.7 An instrument must require the body to publish arrangements for obtaining the views of staff and students on the matters for which the body are responsible under paragraph 6(3)(a) or (b).
8 An instrument must permit the body to change their name with the approval of the Secretary of State.
9 An instrument must specify how the body may modify or replace the instrument of government and articles of government.
10 An instrument must prohibit the body from making changes to the instrument of government or articles of government that would result in the body ceasing to be a charity.
11 An instrument must provide for—
(a) a copy of the instrument to be given free of charge to every member of the body,(b) a copy of the instrument to be given free of charge, or at a charge not exceeding the cost of copying, to anyone else who requests it, and(c) a copy of it to be available for inspection at the institution on request, during normal office hours, to every member of staff of, and student at, the institution.12 An instrument must provide for the authentication of the application of the seal of the body.
Part 3Wales13 This Part applies in relation to further education corporations in Wales.
14 Provision made by an instrument in relation to the appointment of members of the corporation must take into account the members who may be appointed by the Welsh Ministers under section 39 of the Learning and Skills Act 2000.
15 (1) An instrument must provide for—
(a) the number of members of the corporation,(b) the eligibility of persons for membership, and(c) the appointment of members. (2) An instrument may provide for the nomination of any person for membership by another, including by a body nominated by the Welsh Ministers.
16 An instrument must provide for one or more officers to be chosen from among the members.
17 An instrument may—
(a) provide for the corporation to establish committees, and(b) permit such committees to include persons who are not members of the corporation.18 An instrument may provide for the delegation of functions of the corporation to—
(a) officers or committees, or(b) the principal of the institution.19 An instrument may provide for the corporation to pay allowances to its members.
20 An instrument must provide for the authentication of the seal of the corporation.
21 An instrument must require the corporation to—
(a) keep proper accounts and proper records in relation to the accounts, and(b) prepare in respect of each financial year of the corporation a statement of accounts.22 An instrument must—
(a) provide for the appointment of a principal of the institution, and(b) determine which functions exercisable in relation to the institution are to be exercised by the corporation, its officers or committees and which by the principal of the institution.23 An instrument must make provision about the procedures of the corporation and the institution.
24 An instrument must provide—
(a) for the appointment, promotion, suspension and dismissal of staff, and(b) for the admission, suspension and expulsion of students.25 An instrument may make provision authorising the corporation to make rules or bye-laws for the government and conduct of the institution, including in particular rules or bye-laws about the conduct of students, staff or both.””
Lord Hill of Oareford
“ (1) LSA 2000 is amended as follows.
(2) In section 110 (secondary education), in subsection (5), for “51(3A)” substitute “16A(2)”.
(3) In section 143 (further education sector: designated institutions), in subsection (6)(b), for “section 29” substitute “any of sections 29 to 29C”.”
“ In section 22 of the Further Education and Training Act 2007 (consultation of further education institutions), in the new section 49A to be inserted into FHEA 1992 in relation to Wales—
(a) in subsection (1)—(i) after “further education sector” insert “in Wales”;(ii) for “appropriate authority” substitute “Welsh Ministers”;(b) omit subsection (3).”
“Academies: school teachers’ qualifications
(1) EA 2002 is amended as follows.
(2) In section 133 (requirement to be qualified), in subsection (6) (schools to which this section applies), after paragraph (b) insert—
“(c) an Academy, including a free school,(d) a city technology college, or(e) a city college for the technology of the arts.”(3) At the end of subsection (6) of that Act insert—
“(7) Nothing in subsection (6) should prohibit a school’s ability to employ non-qualified individuals to provide educational support in relation to non-‘specified work’ in so far as it would positively contribute to pupils’ educational development”.
(4) Any individual employed under the terms of subparagraph (3) above shall be supervised in their work by a qualified teacher.”
Baroness Jones of Whitchurch
My Lords, Amendment 84A has a simple but fundamental aim—that is, to ensure that all teachers practising in the classroom have qualified teacher status. Until recently this was the case in all state schools but the Government have decided that this will not be a requirement for teachers in free schools. This was debated at length in Grand Committee and the need for teachers to be qualified, as I recall, had virtually unanimous support. For many noble Lords it was what I would colloquially describe as a no-brainer. During the debate the Minister said that the Government’s reasoning for this was,
“simply intended to allow the possibility of greater innovation at the edges of the maintained sector”.—[Official Report, 14/9/11; col. GC 227.]
He repeated this argument in a letter to me of 25 October. I do not think that many of us were convinced by this argument at the time. It was, with respect, completely lacking in evidence or justification.
The Minister then went on to argue in his letter that a skill in measuring the progress of each pupil and the delivery of good-quality subject materials were important elements of teacher training but that he,
“believes it is possible for a teacher to be proficient in them without having attained Qualified teacher Status”.
My simple challenge back to him is: how would he know? How would parents or even head teachers know if these people were truly up to scratch?
This issue goes to the heart of the professional standing of the teaching profession. Whereas most sensible participants in this debate—including the teachers—would argue that the challenge is to drive up standards in the classroom and increase professionalism, the Government seem to be pulling in the opposite direction.
In our earlier debate, a number of noble Lords contrasted the status of teachers with other professions. For example, we wondered whether allowing doctors in certain hospitals not to be qualified would enable “greater innovation”. We wondered what concerns colleagues would have about the standard of patient care in those circumstances and what would be the impact on successful treatment rates. Of course, you can make a similar analogy with other professions.
It is difficult to see why positive innovation is more likely to come about where people are not trained to the required standards in their profession. It is all too easy to see, in the case of unqualified teachers at free schools, how cohorts of children could be failed by teaching quality below the expected level of a qualified teacher.
Our amendment in part is about the Government showing to the teaching profession that they value and want to build on the professionalism in the sector. More than that, it is about ensuring standards in what we believe is one of the most important jobs that it is possible to have. It is in the interests of us all that the next generation is taught to a high standard by trained professionals, and it will do us all a disservice if it is not.
As I mentioned in Grand Committee, the reasoning for the Government’s position is unclear. I noted that the Secretary of State had said of free schools:
“We want the dynamism that characterises the best independent schools to help drive up standards in the state sector … In that spirit, we will not be setting requirements in relation to qualifications”.—[Official Report, Commons, 15/11/10; col. 623.]
I question the presumption that a highly performing independent school is the result of the fact that its teachers do not need to be qualified, although of course many already are. Surely the more significant factors are those such as selection processes and smaller class sizes.
If the Government are serious about building on the successes of the previous Government in raising standards of teaching; if the Prime Minister and the Deputy Prime Minister are serious when they say in the White Paper that is indeed called The Importance of Teaching,
“no education system can be better than the quality of its teachers”;
and if the Government seriously want to learn from international best practice, about which the OECD says:
“many of the high performing countries share a commitment to professionalised teaching”,
how can the Government at the same time say that in some of our schools teachers do not need to be qualified to teach? As the noble Lord, Lord Storey, argued in Grand Committee, it is almost Dickensian.
As colleagues rightly said in Committee, we are not saying that everyone who stands in front of a class should be qualified. I recognise that, for example, trainee teachers are and should be permitted to teach as part of their training. I accept the points made that people without teaching qualifications, such as teaching assistants, add real value to the classroom and make a difference to children’s lives. What is important and what our amendment aims to achieve is that the progression of each pupil should be overseen by someone with a teaching qualification.
It is a basic right of pupils to be taught by a qualified teacher. Parents expect it and the teaching profession seeks it. There is no research or evidence to show that pupils will benefit from this change. I hope noble Lords will feel able to support our amendment. I beg to move.
Baroness Massey of Darwen
My Lords, I am seriously concerned about the issue of having non-qualified teachers in a classroom. Qualifications for teaching are not just about being qualified to teach maths, science or languages; they are about having some knowledge of child development. It is crucial for teachers to learn about how children grow, how they learn to think and how they learn at different ages. It is different if a parent or grandparent goes into a classroom to hear children read or other such activities. Those people are under supervision and fit in with what the class is doing anyway. I would not like someone who was not qualified to be teaching chemistry or physics. It seems quite a dangerous thing to happen. I certainly would not allow into my house an electrician or a plumber who was not qualified. Why would we allow people who are not qualified to teach children? My young nephew recently trained to be a soccer coach for young people. He had to learn not only the skills of teaching soccer but various techniques of teaching as well as first aid. Having non-qualified people in classrooms could miss out all those extra things that teachers learn.
I have some questions for the Minister. How will these non-qualified teachers be recruited? Who will they be? Supposing that they were predominant in a school, what kind of education would those children receive? This is a very serious issue. I look forward to the Minister’s response.
Baroness Walmsley
My Lords, the noble Baroness, Lady Jones, used the analogy of unqualified doctors in a hospital. While we are not talking about life and death here, we are talking about life chances. I know that the Government have an enormous respect for teachers and a genuine intention to improve the professionalism of teachers right across the board, but I have some questions about how this particular freedom would work. For example, would there be a maximum percentage of people teaching children in a free school who did not have a teaching qualification? How would the number of people teaching in a free school without a qualification be monitored? Would there be continuous professional development to make up the gap identified by the noble Baroness, Lady Massey, when someone might be particularly good at IT or a particular modern language, which have been used as examples by the Government, but had not had that training in child development and classroom management—another very important thing taught in teacher training? How will the Government monitor this and make sure that the standard of what the children in schools receive is of the highest? That is what matters in the end. It does not matter so much what is written on a piece of paper as long as those children who walk through that school door get a good offer from the school.
I hope that my noble friend the Minister will answer all those questions. It has been said that this is envisaged to operate in the margins of maintained schools. That may be all very well, because plenty of different people who come in to contribute to children’s experience in schools do not have qualified teacher status. We all understand the importance of the direction of teachers and their overall experience in the school. I would not want them to be operating any more than in the margins of the teaching workforce in any particular school. I hope that my noble friend the Minister can answer those questions.
Baroness Perry of Southwark
I yield to no one in recognising the importance of the right kind of training for teachers and I have spent a great deal of my life in working on trying to get the training right. It is extremely important for the vast majority of teachers that they have been trained and that they understand the things that the noble Baroness mentioned, such as child development, and have an understanding of how children learn, and so on. But I also think it extremely important that we have some flexibility for the outstanding person who brings a particular gift, talent and knowledge. I remember a case some years ago, I think in the 1990s, of a professor of mathematics, an outstanding mathematician, who had taken fairly early retirement and decided that he would like to teach younger children, in a secondary school, to pass on his passion for mathematics to young people. He discovered that because the regulations said that he had not been trained as a teacher he could not do that. It is a mistake—a mistaken idea of what is needed in a school.
As my noble friend Lady Walmsley has said, I would want the overwhelming majority of teachers to have been trained, but it is important to have flexibility to bring in the right kind of person to fill a niche in a school, someone who can bring perhaps a very special talent and range of experience, which would be exactly what the school needed and would hugely contribute to children as they go through their schooling.
Lord Knight of Weymouth
My Lords, this is an important amendment and it is important for the Minister to respond to the questions that have been raised. When the Government were first formed, they made great store of talking up the importance of teaching. Indeed, the title of the first White Paper that the new department published was The Importance of Teaching. Just now, I looked up the discussion document on teacher training published in June this year, where the Secretary of State, Michael Gove, begins his foreword:
“If we want to have an education system that ranks with the best in the world, then we need to attract the best people and we need to give them outstanding training”.
Clearly, if we believe what the Secretary of State is saying on that aspect of the Government's policy, the Secretary of State understands the importance of trained, qualified teachers.
I listened carefully to what the noble Baroness, Lady Perry, said in preceding me and it is important to offer people the opportunity to come in with other expertise and knowledge. However, there are ways of doing that while still preserving the importance of qualified teachers. For example, it should be easier for people to become qualified and to train on the job in terms of pedagogy. What I would not want to see is this opening the door to a sort-of “Jamie's Dream School” approach. Just because you are brilliant in your field—you might even be a brilliant noble Lord—it does not mean that you are necessarily going to be a brilliant teacher. I think that those of us who watched any of the episodes of “Jamie's Dream School” will have been appalled at times by the inability of some of those people, brilliant in their subject, to relate to children and to teach them. It needs some training so, yes, we should allow some of those brilliant people to enter the teaching profession but we should also allow them an opportunity to train and gain pedagogical understanding as they do so, under the supervision of a qualified teacher. That is what this amendment offers.
I am concerned that as the free school policy develops, it is being informed by a belief on the part of some in the department that if it works in independent schools, it must work in free schools and in the maintained sector—because independent schools can have non-qualified teachers, it must be fine. We have heard the parallels with health, for example, and about whether it is fair to presume that if I bowl up to a hospital and it has let somebody practise, it will be all right and it does not really matter whether they are qualified. I do not like that idea. I would not trust someone to treat me as a medical practitioner unless they were qualified and I would not want to trust my children to a teacher unless that practitioner was qualified.
Many or most independent schools do a great job but they do that with a very narrow set of pupils. I know that if my friends in the Headmasters’ and Headmistresses’ Conference were listening, they would be shouting at me but it is fair to say that it is often the case that those pupils are from fairly narrow backgrounds and do not, by and large, have quite the same behavioural challenges or some of the obstacles that have to be overcome in the maintained sector. I would be looking for training to inculcate those sorts of skills in teachers.
This is a good amendment. It seeks to give some guarantees on quality. We have had debates during this Report stage on the weakening of admissions and on some schools being exempted from inspection by Ofsted. We seem consistently to be weakening some of the measures and guarantees of quality in order to pursue and make a success of this free school policy in terms of numbers and flexibility. If we are to go with the free-market approach to education, we need to hang on all the more tightly to guarantees of the quality of the workforce, the quality of the inspection and fair admissions. We have also talked about fair funding. In the end, I will always come back to this in debates on this Bill: I fear that unless we can give some guarantees about the workforce being qualified, we will lose quality in some of these free schools.
In the United States, some of the charter schools were set up with the best of intentions by parents who were dissatisfied with what was going on locally. They might think, “Well, I’m okay as I have done a bit of home education myself. I’ll rock up and teach—it’ll be fine”. They are very well intentioned, and it might be fine for their kids, but I am not persuaded that it is fine. The experience of so many charter schools in the United States is that it is not fine; so many of them have failed. There are some great ones, but many of them are not great. I do not want to take that risk in this country.
Lord Northbourne
My Lords, this suggests that teaching is not entirely about qualifications; it is also a gift of God. However, that was not what I intended to ask. I wanted to ask the mover of the amendment what is meant by “non-specified work.” I am concerned —so are the Government, and indeed we should all be concerned—about, for example, those who do not have a tendency to be very successful in academic qualifications and who need to get fulfilment in life from their work, or from other skills. Why should not someone be taught to use a lathe by someone who is brilliant at using a lathe, rather than by someone who has an academic education? Or perhaps I have got it wrong.
Lord Sutherland of Houndwood
My Lords, this is an amendment about professionalism, and I think everyone who has spoken supports the importance of professionalism. I commend the Government for what they have done in this area already, as well as the previous Government, as important things were done then.
However, I have reservations about a universal requirement for a particular kind of qualification. If we take the example of health, I would not mind being nursed by a nurse who was not a graduate, although actually these days, that does not seem to be on. I do not want to push that analogy at all, but to point up the remarks of the noble Baroness, Lady Perry: there may be exceptions. There may be individual cases that, if we were too rigorous, would be excluded. However, the question—which I believe has just been raised —is of proportionality, and whether it can become disproportionate in, for example, free schools.
There is a real danger there, and I have already expressed worries about inspection and exemption from inspection in these areas, which is why I think the questions raised by the noble Baroness, Lady Walmsley, are fundamental. I approve of the use of the word “normally” here, and I wish it was in more legislation, but “normally” must then be monitored. I hope there are clear answers to the questions that she has asked.
Lord Storey
My Lords, I have said before in this House that the most important thing for a student is the quality of the teacher—not the qualifications, necessarily, but the quality. There can be the best buildings, the best resources, but unless there is quality teaching, then that child will not be able to make the progress that they deserve. If you have poor teaching and a poor teacher, that child loses the year, and the year can never be repeated. It is lost for good.
Since I have come to this House, the one thing that has struck me in education debates is that in every speech and contribution I have heard, the child is at the centre. I have felt quite emotional, to be honest, about the care that has come to me from the comments that people have made. We had a debate on special educational needs, and I was absolutely stunned by the remarkable contributions from everybody in this House.
However, one thing said constantly in that debate was that it needs to be about training, and about understanding the child. You cannot just put anybody in and expect them to be able to teach, understand, and relate to the child. It has to be a whole package. That is not to say that everybody must be a qualified teacher. There are examples of people who have a natural gift for teaching but are not qualified. How do we make that system work? Well, we have a system presently that allows that to happen.
I speak from practical experience. At the tail end of the summer term, I had a situation in my school where a teacher left. Working in that classroom was a teaching assistant; an advanced, higher-level teaching assistant, who was—to use an expression—“stunning”. The pupils thought the world of him. Being a conscientious, thoughtful person, I checked with my local authority, which said, “Yes, as long as he has a higher-level qualification and you’re happy with him, he can take the class”, which he did for three weeks. He was fantastic. The children progressed. I have to say, I would rather have had him than—no, perhaps I should not say that. He progressed and did incredibly well. He was also supported by the school and other teachers, who were able to compensate for any areas in which he needed to develop. As a result of that, he has decided that he will not just be a higher-level teaching assistant; he will go on to be a teacher.
There are occasions when you can put people who do not have the formal qualifications in the classroom, and they can do a remarkable job. My noble friend Lady Benjamin constantly reminds me that pupils from the Caribbean often need a very different type of teacher, and that maybe the qualities that we currently have in our teaching profession are not always able to deal with those situations. That is dealt with, again, by encouraging teaching assistants who are working with teachers in the school environment.
When the Minister replies I hope he will deal with the questions that have been asked by my noble friend Lady Walmsley. I also hope he will reflect on how we might combine both desires.
I do not have a problem with free schools. I remember the first free school, which was Scotland Road Free School in Liverpool in the 1960s. What I have a problem with is saying that you can have non-qualified teachers in an educational establishment. If free schools are to be successful, they cannot be seen to be on the margins. Parents will soon think, “Oh, these are inferior places. They haven’t got any qualified support in those schools”. They will not send their children to them once the initial idea has started.
I will make one further point. There are whole areas of teaching that, in a complex society and a modern world, people who work with children need to know about—safeguarding, for example. Are we saying that these adults who will teach in free schools will not have any training in safeguarding, or in the problems of special educational needs? The list goes on. We need to be absolutely sure that we get this right.
Baroness Morris of Yardley
My Lords, I also support this amendment, on which there is a fair degree of unanimity across the Chamber. My position is approximately the same as that of the noble Lord, Lord Sutherland. We do not want schools where everybody has the same qualification. Over the past 10 to 15 years, we have very much moved to having different qualifications in schools. Clearly, what we want is for someone to be qualified to do the job that we are asking them to do, and for people to know what they are qualified to do and what their training is. We have never had that in the past. We have been a one-qualification profession. We ought to be more like medicine and move away from that, to having a number of different qualifications.
We have a record of getting this right. The movement of bursars into the maintained sector has been hugely successful, as have the teaching assistants and higher-level teaching assistants to which the noble Lord, Lord Storey, just referred. Therefore, we are on a journey of trying to get this right. The issue that faces us now is: where do we go next? I should have thought that where we go next is to look at the evidence of what has worked so far, the skills that are needed in the school and what training is needed. I absolutely accept that there will be some individuals who have experiences and a skill set that teachers and head teachers will want to use in schools. Some of them, as the noble Baroness, Lady Perry, said, will be absolutely excellent in their field. They may have a skill set that teaching would go alongside.
There is a fair degree of unanimity across the Chamber over our vision of what we want schools to be like. Therefore, the question is whether the legislation that the Government are putting forward will arrive at that end. I do not think that it will. I cannot see why this big debate about how we get a qualified workforce—whatever the qualification may be—is being squashed into free schools. I would have thought the debate was bigger than yet another freedom that we can give to free schools. The debate is about the qualifications we need for all our schools, whether they be maintained schools, community academies or free schools. The Minister must address in his reply what this has to do with free schools. It has to do with all schools. I am not sure why he has cornered and corralled this debate into free schools. It is bigger than that.
Lord Lucas
My Lords, the man that my noble friend Lady Perry was remembering was Tristram Jones-Parry—one of the finest headmasters Westminster School has ever had. When he retired he was not allowed to teach mathematics in a state school, although he had taught it at Westminster. This illustrates how fatuous the current situation is.
I am also worried about this amendment in terms of what the noble Lord, Lord Knight of Weymouth, was saying a few days ago on the way in which teaching will move as technology moves in. People outside teaching will become much more involved. There is a lot of demand from industry to get involved, say, in language teaching and make their staff available for language teaching. The situation is similar in technology. Certainly the teacher has a very strong role in supervising this, but some of the teaching will be done by people who are never going to be qualified; people who have no interest in becoming qualified and who are performing that function under the supervision of a qualified teacher.
My suggestion to my noble friend is that the best way to tackle the concerns that have been addressed around the House is to make sure that anybody who asks can see a full list of the qualifications of every member of staff in the school. In this way, whatever decisions are being made by the head will be made in public and will be decisions that he or she will have to justify. That seems to me the best way to combine safety with the sort of flexibility that will let some very good people teach, despite their lack of some particular qualification.
Baroness Warnock
My Lords, I support what the noble Lord, Lord Lucas, has just said. In the case of languages particularly, it would be losing an enormously fruitful possibility to forbid teachers of foreign languages to teach because they had no qualification. There are many people who come over to this country who would be very good teachers but have no qualification—a wife of somebody who is doing a professional job, for example—and they would be an extraordinarily good resource to be able to use. The question of supervision is, of course, enormously important. The other area where we would lose a great deal is that of music. A lot of professional musicians do not take a teaching qualification.
There are born teachers who love teaching and teach extremely well, but who do not want, or are too old to take, a teaching qualification. They should not be forbidden in our schools. We need lots of flexibility here. It is the attitude of the person to his or her pupils that is important, not a formal qualification. I strongly support what the noble Lord, Lord Lucas, has just said.
Baroness Benjamin
My Lords, many Afro-Caribbean families feel that their children are not being served well in schools. We all know that and it goes without saying. A lot of parents believe that the opportunity to have a free school is one advantage that will give their children an opportunity to have a fulfilled relationship in the classroom, as the noble Lord, Lord Knight, said. Having a teacher who is perhaps not fully trained is an opportunity to make sure that those young people who need just a bit of understanding and care can feel that the way that they are thinking and feeling is being embraced. Free schools have given them that opportunity, and if the teacher is not qualified—as we have heard from many noble Lords in the House—we will be doing a great service to those young people in our society who feel excluded in many ways.
Lord Hill of Oareford
My Lords, I agree with the noble Baroness, Lady Morris, that this has been an extremely good and interesting debate, and I am grateful to all noble Lords who have spoken from a range of different perspectives, and for some of the advice that I have received, which is helpful. At issue here is, in some way, a distinction between quality and qualification. There is complete agreement that we want the highest possible quality; the difference of opinion is whether the only way that the highest possible quality can be secured is through a specific qualification. I think I sum the mood up accurately by saying there is a feeling that quality is not defined only by one specific qualification.
It is certainly the case that improving overall teacher quality is very much at the heart of what the Government are trying to achieve through their education reforms. I agree with what all noble Lords and the noble Baroness, Lady Jones of Whitchurch, have said about the importance of teacher professionalism. Across the piece, the Government are introducing a range of reforms to try and raise the status of the profession. We are reforming initial teacher training, trying to ensure that we attract more top graduates, strengthening teachers’ powers and authority in the classroom, and streamlining performance management arrangements.
We think that qualified teacher status has an important part to play in the teaching profession. That is why, in March, we set up a review of teacher standards, led by Sally Coates, to make all teacher standards, including those that underpin QTS, clearer and more focused. The review recommended revised standards that will take effect from September 2012 and raise the bar for entry to the profession.
We certainly think that qualified teacher status has an important role in the system, but we think that it is possible to be an outstanding teacher without having QTS. A number of noble Lords spoke during our debate in Committee and again this afternoon about the value that individuals from a range of backgrounds, experience and expertise can bring to the classroom. It is true that under current arrangements such individuals can already bring their experience to bear in the classroom, but to a limited extent. Broadly speaking, they may only assist or support the work of a teacher with QTS and must be directed and supervised in doing so.
The core purpose of the free schools programme that lies at the heart of the issue is to make it easier for parents, teachers and others to set up new schools in response to demand from their local community for change in education provision in their area. That is the basis upon which free school proposers set out their educational vision. We want to give them the ability draw on as wide a pool of talent as possible to deliver that vision. If a free school believes that that means including among its staff a teacher who has a wealth of qualifications, experience and expertise, but who does not have QTS, we do not want to prohibit the free school from doing so.
My noble friend Lady Perry, the noble Lord, Lord Sutherland of Houndwood, the noble Baroness, Lady Warnock, and my noble friend Lady Benjamin all spoke persuasively about the need for some degree of flexibility. The kind of example that we have in mind would be that a free school might want to employ an experienced science teacher from the independent sector who has a strong track record of preparing pupils for top universities. That would be one example. We have a free school proposal from a group of independent schools that wants to set up a sixth-form college in Newham to try to get more children from disadvantaged backgrounds to go to top universities. My noble friend Lord Lucas mentioned another example in which the former head of Westminster School was caught by the rules. A free school might want to employ an engineer with a background in training and instruction to teach an engineering technical specialism.
Free schools know that recruiting high-quality teachers will make the biggest difference to the quality of education that they can provide for their pupils. Therefore, I believe that they will themselves want to ensure that the staff that they recruit have the right knowledge and skills, and that relates to the point that my noble friend Lord Storey made about how free schools will be accountable and what mechanisms will be in place to make sure that they want to employ the best possible teachers. As part of their application to the department to set up a free school, proposers have to set out how they will deliver the highest quality of teaching and leadership in their schools, and no school is allowed to proceed without robust plans for doing so.
Because they are new schools set up in response to parental demand, free schools are likely to have a particularly close relationship with parents, who, we believe, will hold them sharply to account for the quality of teaching. They will be subject to the same Ofsted inspection regime as all maintained schools. They will have a pre-registration inspection before they open and a full inspection by the end of their second year of being open.
My noble friend Lady Walmsley, with support from the noble Lord, Lord Sutherland of Houndwood, asked, importantly, how we would know what was going on. I would answer that, in part, by talking about the publication of results and parents holding to account, but it is also the case that staff employed in free schools who do not have QTS will be monitored through the school workforce census, which takes place once a year. The results of that will be published on the department’s website and we will all be able to see the extent to which this is happening or not happening.
Lord Knight of Weymouth
Beyond saying that there is quite a lot of flexibility in the proposal, can the Minister tell us whether the publication of the number of unqualified teachers in free schools would feature on the Ofsted risk assessment that we talked about last week? If there were a large number of unqualified teachers in a free school, that would mean that Ofsted would be keeping a closer eye on them.
Lord Hill of Oareford
I do not think that that would necessarily be the case. For that to be so, one would have to accept the premise that, for example, an extremely experienced science teacher with a long record of preparing children to go to university or someone with an engineering specialism was innately a greater risk to teaching standards than someone with QTS, and I do not believe that that is the case. However, we would have the data on the numbers. The early evidence from the first 24 free schools is that a minority are availing themselves of the freedom. We will see how that develops and, in response to the point raised by my noble friend Lady Walmsley, the information will all be out there in the public domain for people to see.
A particular concern was raised by my noble friend Lord Storey about safeguarding, and I hope that I can reassure him. Free schools will certainly need to have regard to the statutory guidance on safeguarding. The guidance says that all staff should undertake appropriate training. It also says that a senior member of the school’s management structure should have lead responsibility for dealing with child protection issues and liaising with other agencies where necessary. Free schools, like any other schools, have a statutory duty to undertake CRB checks on all members of staff. Free schools are required by their funding agreements to appoint a SENCO and a designated teacher with responsibility for children in care who hold QTS.
The Government do not think that giving additional flexibility to a small group of schools for a particular reason is a new idea. When the previous Government introduced academies, for example, they gave them a number of freedoms, such as the one to depart from the national curriculum. I do not think that in essence this issue is different. It is a permissive measure. There are accountability measures and I think that safeguards are in place. I therefore ask the noble Baroness to withdraw her amendment.
Baroness Jones of Whitchurch
My Lords, as other noble Lords have said, we have had a very good and wide debate on this issue. I ask noble Lords to read the wording of our amendment because it is not as stark as some people would have us believe and we have tried to craft the wording carefully. It is not saying that only qualified teachers can teach in the classroom. It says that people with all sorts of skills can come into the classroom—they can be inspiring leaders, or as the noble Lord, Lord Northbourne, said, they can be specialists in teaching children how to operate lathes. All those people have a role in the classroom, but the wording of our amendment is that they have to be supervised by a qualified teacher. We feel that that is vital because of the arguments that have been made around the Chamber this afternoon.
You can be the best specialist in the world at maths, science or whatever, but you need to have some teaching and education in child development, behavioural issues and the different ways that people learn, adapt and interact with each other and a whole range of SEN issues. I do not think that someone who has had a professional job outside teaching would necessarily understand or know about those issues. The issue, which is carefully spelt out in our amendment, is that those people should have a role but that they should be supervised by somebody with qualified teacher status.
At the moment the proposals are at the margin; we are talking only about free schools and it may apply to only a handful of teachers. What signal is that sending? As a number of noble Lords have said, if this is so wonderful—as the Minister said, let us access the greatest pool of talent—will the Government say, “Great, let us extend that beyond free schools”? That is a very dangerous road to go down because, as people have rehearsed round the Chamber this afternoon, the issue of professionalism and driving up standards should be at the heart of what we are doing. We should not be trying to undercut and undermine the profession by deprofessionalising it.
The core point that I put to the Minister, which he did not really answer, is: where is the evidence that unqualified teachers provide better education than qualified teachers? The Secretary of State has put great onus on this in a number of his speeches. He likes research and likes everything to be evidence based, but that strikes me as being a stab in the dark. There is no evidence that in the independent sector it is the fact that teachers are unqualified that drives up standards. I am not convinced from what the Minister has said that there will be sufficient monitoring. It is almost as if we are entering a wild experiment with no terms of reference, no end date and no assessment of whether the experiment has been successful. We are doing that at the expense of a generation of young people, whose education could potentially be damaged by this.
For all those reasons, the proposals are going in the wrong direction. Our amendment says that there should be a qualified teacher who oversees the work of what happens in the classroom. That is a perfectly reasonable thing to request and it is in all pupils’ interests. I am not convinced by the Minister’s argument this afternoon, and I beg leave to test the opinion of the House.
(2) The consultation must seek the views of such persons as the person carrying it out thinks appropriate, but must include the views of parents of registered pupils, registered pupils, school staff and the local authority.”
Baroness Jones of Whitchurch
My Lords, under existing legislation, before a maintained school can convert into an academy, its governing body must consult those it thinks appropriate on whether the school should convert into an academy. However, Clause 55 allows a school to convert into an academy with absolutely no consultation with the pupils, the parents of the pupils, staff, the local authority or other interested groups. Our amendment would require consultation before a school applies for an academy order and require that consultation to seek the views of four categories of stakeholders: parents, pupils, school staff and the local authority. We regard it as a matter of courtesy, democracy and common sense.
As we made clear in Grand Committee, we do not seek to set out in legislation a long list of everyone who should be consulted, but it is our view that any Secretary of State considering granting an academy order would need to be assured that the views of the four key groups were being taken into account, so any consultation should be required to include them. Indeed, the Minister said to my noble friend in Grand Committee:
“I agree with the noble Baroness, Lady Hughes, that it is quite difficult to foresee situations where it would not be appropriate to consult the kinds of people that she mentions”.—[Official Report, 14/9/11; col. GC 242.]
I wonder whether, on reflection, the Minister has come up with a possible situation in which it would not be appropriate to consult these four groups and, if not, whether he will concede that, in order for any Secretary of State to make a well informed decision, these groups should always be consulted.
I also agree with the concerns previously raised by the noble Baroness, Lady Walmsley, that under the new proposals one of the bodies allowed to carry out the consultation, apart from the school’s governing body, is the organisation with which the Secretary of State proposes to enter into an academy arrangement. As she rightly pointed out, this is no guarantee of an objective or neutral consultation. We therefore believe it is important to build in some additional checks and balances to ensure that a new academy is truly desired by the local community. By requiring the consultation to include the views of these four key stakeholder groups—pupils, parents, staff and the local authority—those applying for an academy order will need to demonstrate to the Secretary of State that there is local demand for the conversion, not just from the organisation with which the Secretary of State has proposed to enter into academy arrangements but from the wider stakeholder community. If this clause was allowed to go forward unamended, it would be yet another example of those stakeholder groups being denied a voice.
I recognise that, strictly speaking, the granting of an academy order enables a school to convert into an academy only at a future time; it does not automatically trigger conversion. By denying the chance for parents, pupils, professionals and the community to have a voice before the academy order is made, to a large degree it presents them with a fait accompli. Indeed, our amendment would ensure that the key stakeholders were consulted on a timely basis so as to be able to influence a decision whether or not to apply for an academy order. It would mean that the Secretary of State would need to take account of those views when deciding whether or not to grant that order.
I hope noble Lords will recognise the sense and the democratic underpinning of this amendment. I beg to move.
Lord Hill of Oareford
Perhaps I could say a couple of words now and obviously reply at greater length later. There are a couple of government amendments in this group.
Amendment 84C in my name is a technical amendment. It clarifies the Academies Act 2010 by removing any doubt about local authorities’ funding powers in relation to academies. Under Section 6(2) of the Academies Act, a local authority must cease to maintain a school once it converts to academy status. This is because academies are funded directly by the Secretary of State. However, in certain circumstances, local authorities might still want or need to assist academies: for example, where an academy is part of a private finance initiative contract held by the local authority. When a PFI school becomes an academy, it remains part of the PFI contract and as part of that contract the authority makes regular payments to the contractor in respect of that academy. It meets these payments from a combination of sources: funding from individual schools’ budgets, including a contribution from any PFI academies; revenue funding from the department; and funding from its own resources. When a PFI school becomes an academy, we ensure that the local authority is in a “no better and no worse” position in relation to the PFI contract than if it had remained a maintained school.
As I explained in my letter of 19 October to the noble Baroness, Lady Hughes of Stretford, a number of banks that finance PFI contracts have expressed concerns about whether local authorities have the legal power to make payments in relation to PFI academies. The Government believe that local authorities do currently have the power to assist academies financially or otherwise. However, we recognise the demand for this point to be put beyond doubt, which is what Amendment 84C seeks to do. The amendment clarifies local authorities’ existing powers in relation to academies; it does not place any new requirements or duties on local authorities. In order to provide clarity as early as possible, the amendment to Clause 78 provides for this new clause to come into force on Royal Assent.
Baroness Walmsley
My Lords, I apologise to my noble friend the Minister for standing up too soon.
I want to address the amendment in the name of the noble Baroness, Lady Jones of Whitchurch. Of course, this subject was discussed at very great length during the passage of the Academies Bill through your Lordships’ House. I agree with the noble Baroness that it is good practice, prior to making an application, for the proprietors of an academy to consult all the groups she has mentioned, and probably many others too. All those groups would have a justified complaint to the school if they were not consulted. The Act says that appropriate groups should be consulted, and there is no question that all those four groups are appropriate groups.
However, I would like to ask the noble Baroness what evidence she has that over the last 12 months, say, academies have not been carrying out that best practice and have not consulted those very relevant and appropriate groups prior to making the application. If we are going to make a change, we should have the evidence that there is the need for a change. Perhaps she can supply that evidence when she responds, because I do not think there is any.
Lord Hill of Oareford
My Lords, as my noble friend Lady Walmsley has said, we debated these issues at length and amended the consultation requirements during the passage of the Academies Act, which was just over a year ago. The fundamental question today, as it was a year ago, is how much detail about consultation we should prescribe in statute. When we discussed consultation during the passage of the Academies Act, the noble Lord, Lord Adonis, shared with this House his experience of consultation on the academies programme. He argued that just because the detail of a process is not set out in statute does not mean that it does not happen in a comprehensive manner.
Like the noble Lord, Lord Adonis, this Government do not believe that minimal legislation leads to minimal consultation, which was the point made by my noble friend Lady Walmsley. Also like him, and like schools and head teachers, we believe firmly in the importance and value of consultation. The department’s website contains advice on carrying out all stages of the academy conversion process, including consultation. A departmental official liaises with every converting school and among other things advises it on ways to ensure a fair and open consultation.
Ultimately, schools make the choice to convert and they are under a legal duty to carry out a reasonable consultation of appropriate persons. Given the variation in these circumstances, it is right that the school assesses, in carrying out its consultation duty, what is reasonable in its local community, rather than Ministers prescribing it from the centre. Once consultation is complete, it is the responsibility of the school to reflect on the responses and to decide whether to proceed with academy conversion. That will go ahead only with confirmation from the school to the department that it has carried out its legal duty to consult appropriate persons and that the school wishes to go ahead, having considered the consultation responses.
The noble Baroness raised two issues about whom to consult and when the consultation should take place. In relation to whom to consult, we think that schools can be trusted to assess who the appropriate persons are to consult according to the circumstances and that in those cases the appropriate parties, as my noble friend has just said, will include parents, pupils and staff. If we have concerns that consultation has not been adequate—for instance, if parents have not been consulted—these concerns will be raised and dealt with prior to the funding agreement being signed.
On the timing of the consultation, the noble Baroness pointed out that consultation should take place before a decision is made, and I agree. The consultation requirement in the Academies Act already reflects this principle. It requires that consultation should take place before a school is converted into an academy. As I think that the noble Baroness accepted, an application for an academy order is a procedural step and does not signify a decision that the school should become an academy. That does not take place until the funding agreement is signed, which may happen many months after the issuing of an academy order. With that in mind, both last year and still now, it seems right that the school can carry out its consultation and reflect on the responses to it right up until the point at which it decides to become an academy and signs the funding agreement.
We discussed consultation at length during the passage of the Academies Act but, as my noble friend Lady Walmsley has said, we have a key advantage now compared with when we last debated the issue a year ago. Our debate about the legal framework for consultation can now be informed by the experience of schools in implementing it. We have had around 1,100 academy conversions since the Academies Act was enacted. I would argue that for the noble Baroness, Lady Jones of Whitchurch, to ask the House to overturn the position it reached last year after a long debate, she would need to provide strong evidence that there is widespread disquiet about the consultation process. I do not think she has provided that evidence, and I think that that is because it does not exist. The department has had very few complaints from parents or other interested parties about the way that consultation has been carried out. This confirms my belief that the House got the issue right in the Academies Act 2010. I would therefore ask the noble Baroness, Lady Jones of Whitchurch, to withdraw her amendment.
Baroness Jones of Whitchurch
My Lords, I thank the noble Baroness and the Minister for their responses. Several issues are fundamental to this. The first is: how can we be assured that the Secretary of State is in the position to know that a full consultation has taken place? The guidance to which the Minister refers is fine, but we are seeking something that is more of a checklist setting out some of the fundamental rights for certain groups, rather than just the issuing of good practice and guidance. We feel that local democracy on this issue is important.
Our amendment engenders bringing the consultation forward to an earlier stage. We feel that that is right because the evidence appears to be that people feel that once there begins to be a head of steam around a debate about whether there should be a conversion, even if it has not formally been made, it is nevertheless more difficult for local people to put a brake on it or to raise disquiet, or for them to have a voice that is heard.
We do not believe that we have gone into too much detail. The Minister said that they do not want long lists. I said at the outset that we, equally, did not want a long list, but we did want to reassure some of the key stakeholders about their role in all this. As I say, this is very much about our belief in local democracy.
The noble Baroness asked what evidence there was. I would say that that is something for the department to respond to. I am not in a position to collect evidence. I can say, anecdotally, that I know of parents and local authorities who feel that there has not been sufficient consultation. I think that in part the onus is on the department to measure the level of complaints, and the Minister could perhaps respond at some level on this.
I do not think there is anything wrong with our amendment. I do not think that it is too detailed, that it expects too much of the legislation or that it spells out too much detail about what should be required. We have identified only four key stakeholders. This is, to us, a matter of principle. It would give enormous reassurance to people in the locality that their views will genuinely have a voice, and on that basis I beg leave to test the view of the House on this matter.
Lord Hill of Oareford
“Academy orders: local authority powers
In section 6 of AA 2010 (effect of Academy order), after subsection (2) insert—“(2A) Subsection (2) does not prohibit the local authority from providing financial or other assistance in respect of the Academy, including by—
(a) making payments in respect of some (but not all) of the expenses of maintaining the Academy,(b) providing premises, goods or services for the Academy, or(c) making premises, goods or services available to be used for the purposes of the Academy.””
Baroness Turner of Camden
“( ) In section 59(1) of SSFA 1998 (religious opinions etc. of staff), after paragraph (b) insert—
“(c) an Academy that is not religiously designated”.”
Baroness Turner of Camden
I shall speak also to the amendments in my name with which Amendment 85 is grouped.
I am attempting to follow up something which I began in Committee: I am endeavouring to protect the position of teachers in religiously designated schools from having religious views and requirements imposed upon them which they may not support. I am a secularist but I agree with the rights of both the religious and the non-religious. I accept that faith schools exist and are provided for in our legislation. My amendments do not alter that.
I commended the previous Government when they first introduced academies that they also provided for the appointment of what is known as reserve teachers, who could be expected to teach religious education and instruction and to abide by the religious ethos of the school. They were, however, limited in number to one fifth of the teaching staff. The other teachers did not have to comply with this and there was no requirement that the head teacher should be a reserve teacher. It did not seem to me that these requirements under the Bill would apply to other schools, such as foundation or voluntary schools of a religious character, and my amendments in Committee were intended to do that. I have since studied what the Minister said in reply. I have had the opportunity, for which I thank him, of meeting him and his officials and I have made available to him a legal opinion supplied by the secular association. As a result, I have dropped some of the amendments I introduced in Committee and have attempted to concentrate on what I think spells out the best way of complying with the advice I have received and the requirements of European law.
The first amendment seeks to give explicit statutory protection to teachers in community schools that become academies from being required to teach religious education. Many teachers with decades of experience do not wish to teach RE and there is no reason why they should lose the protection afforded to them by this section of the School Standards and Framework Act because of a change of the type of school.
The next amendment, which is in two parts, makes it clear that while preference may be given in connection with the appointment, remuneration or promotion of teachers at a voluntary aided school on the basis of religious belief, this is only to the extent of it being justified as an occupational requirement having regard to the school’s religious ethos. The second part provides that while termination or engagement of a teacher may have regard to compliance with the tenets of the religion involved, discrimination is nevertheless prohibited on grounds not allowed under our equality legislation, such as in relation to sexual orientation.
The third amendment will put into legislation the commitment that the Government have already given that academies which were originally voluntary controlled schools should go through a consultation process similar to that in the maintained sector before being allowed to gain staffing and governance arrangements similar to those in voluntary aided schools.
This may sound complicated because reference has to be made to legislation that already exists and the various schools concerned. However, basically it is quite straight forward. I want to ensure that teachers with no or perhaps different beliefs are not discriminated against as the Government and the previous Government provided quite specifically for faith schools to be able to discriminate in favour of teachers who share their religious outlook, but in line with specific arrangements and limitations on numbers, to which I have already referred. Otherwise, teachers will be recruited and employed on the basis of their ability to teach their particular non-religious subject and are no way discriminated against.
My impression when I met the Minister and his officials was that these views were not opposed by the Government. I hope therefore that my amendments can either be accepted—if the Minister accepts the ideas involved—or perhaps he could produce alternative wording. As I have already indicated, the advice I have received indicates that my wording is in line with our own equality law and European law.
Amendment 88 is grouped with my amendments and my noble friend will no doubt speak in favour of it. I fully support it. In the mean time, I beg to move.
Baroness Massey of Darwen
My Lords, I will speak to Amendment 88 in this group. I support my noble friend Lady Turner in her previous amendments. She has explained the issues very well and I know that she has had extensive consultation with the Minister on them. We have heard most, if not all, of her arguments before and I think that they are very powerful. I know that there is some sympathy for her arguments among various faith groups. While the issue is about religion, it is mainly, I think, about fairness and discrimination.
In Amendment 88, my chief concern is the fostering of segregation in schools on the basis of religion. The change proposed by the Education Bill will make voluntary-aided faith schools the most attractive option to religious groups seeking to set up schools because they will be the easiest to set up. This is especially so if the local authority is readily in favour of the school, in which case proposals would be extremely likely to succeed. It is hard to see how this change is justified in light of the drive towards free schools and the fact that free schools cannot religiously discriminate in admissions for more than 50 per cent of their intake. Surely this is a reflection that faith-based admissions criteria should be curbed, not increased. This will increase religious segregation in admissions, extend discrimination against staff of no religion and increase the number of schools teaching faith-based religious education. I believe, as does the noble Baroness, Lady Turner, that all schools should include and educate all pupils together so that they can learn from each other instead of being segregated on religious and other grounds.
The Lord Bishop of Oxford
My Lords, Amendment 85, proposed by the noble Baroness, Lady Turner, seeks to make it plain that religious criteria may not be used to employ staff in academies without religious designation or to make it obligatory to teach RE in such a school. That seems to me to be unexceptionable and I wonder why the amendment is needed. If it seeks to achieve a result that we would all agree with, it does not seem to me to be necessary. Like all independent schools, academies may use religious criteria in employment only when they are designated as a school of religious character or when a genuine occupational requirement, such as being a chaplain, is shown. Amendment 85 seems to me to be unnecessary at best and potentially confusing at worst.
In my view, Amendment 86 is more serious because it seeks to impose the genuine occupational requirement regime on to voluntary-aided schools, although strangely not on academies, as I read it. The occupational requirement is a substantially lesser power than that which currently pertains for VA schools and I believe that it is inadequate to protect these schools’ faith-based ethos. Noble Lords will appreciate that the faith-based ethos of the school is central to its character and to its performance, which are closely linked. It is particularly important that the leadership of the school is on board with the foundation of faith, because from the leadership flow the shape and character of the school and from that character flow the performance and the standards of the school. We might also note that the commitment to the religious character of the school is necessary in order to fulfil the terms of the trust, which lies behind the school operating on that particular land. That is basic trust law, so we need to keep in line with that.
I assure noble Lords that the governors’ powers of appointment are used with considerable flexibility, sensitivity and discretion. It is far from the case that all staff are from the relevant faith background. Schools want the best person—the best teacher—and the faith commitment of a teacher is only one of many criteria. Local factors are always relevant. I also think that the risks of discrimination are much exaggerated or overstated. I have been able to find hardly any evidence of discrimination in practice. Why would a teacher entirely opposed to the faith basis of a school want to teach in that school? The dual system ensures that, for teachers and other staff, there is always a choice of schools of a different character.
Amendment 86 also seeks to prevent religious reasons being used as a proxy for other kinds of discrimination. Sexual conduct is what the noble Baroness, Lady Turner, will have in mind. I am shocked at the very thought. Let me be absolutely clear: sexual orientation is not relevant and may not be taken into account in employment in a Church of England school. Sexual conduct can surely be taken into account in cases of alleged misconduct, and absolutely in the same way in relations between the opposite sex as the same sex. I therefore believe that Amendment 86 should be resisted.
Amendment 87 seeks to impose a consultation if Section 124AA is to be disapplied by the Secretary of State, thus enabling a VC converter academy to have the employment powers of a VA converter academy. We understand that the Secretary of State will require a consultation anyway as a matter of guidance or of regulation. That is surely fine. There would have to be a consultation if a voluntary-controlled school wanted to become a voluntary-aided school. However, I suggest that it would be better to leave that matter for guidance rather than for legislation, especially in the light of the requirement by the noble Baroness, Lady Turner, that the Secretary of State have regard—that strange phrase—to the consultation, because goodness knows what that will be seen to mean in later years. I believe that this amendment should also be resisted.
Lord Deben
My Lords, I believe that these amendments should be resisted because they are discriminatory. I was fortunate enough to be able to pay for my children’s education. I did so because I wanted my children to go to Catholic schools. I do not think that we should discriminate against poorer people who cannot make that choice. It is perfectly reasonable to choose that you do not want your child to go to a faith school, but to deny the right of people without the resources to choose a school in which the fundamentals are faith-based seems to me a retrograde action that is entirely unacceptable.
It is perfectly reasonable to have some categories of school in which this issue does not arise. These amendments seek to limit even more those categories that exist at the moment. I say to those who put them forward that there is a new kind of illiberalism, which is very determined to remove from parents what for many of us is the most important element in education: we want our children brought in the fear and love of our Lord. We should have that right whether we are rich or poor. After all, it is the church that started education in this country and it is the church that has upheld that education. It is a historic agreement between state and church that has enabled us to have a society in which secular people and religious people can live together in harmony. The increasing demand of those who want a society in which their particular—I have to say—arrogant determination that everybody shall be educated in their way is wholly contrary to the liberal society that we have created.
There used to be a very nasty phrase, “Scratch a liberal and you find a totalitarian”. I am afraid that this is increasingly true in our society. People who claim to be liberal are determined that their liberalism shall—
Baroness Whitaker
I am in some difficulty, because I cannot find where in this group of amendments the right to choose which school children go to is taken away, to use the noble Lord’s words, and where it is said that certain children have to be educated in their way rather than in the way the parents choose. Could he tell me which text he finds that in?
Lord Deben
I listened with very considerable care to how the amendments were introduced by the noble Baronesses. In both cases, the suggestion was that the kind of schools where teachers’ religious beliefs were taken into account, apart from the chaplain or the like, would be schools of which they disapproved because they felt that it was better for children to be educated in circumstances in which there was a wide range of teachers with a wide range of views. I am merely saying that I want a society in which parents can choose and do not have that dictated to them by those who think it would be better for them to have a particular kind of circumstance. I am pleading for that on the basis of discrimination. I do not wish to discriminate against the poor. I am pleading for it also on the basis of liberalism.
In a free society, people should have the choice to the widest possible degree. It is illiberal to say that a person’s belief that a faith-based school is in some way—I think that the word was used, but I will not use it myself; I shall just say “restrictive”, as it makes people unable to share in the rich variety of life. That is an unacceptable position in the sort of society that we have. Young people have a difficult enough time in any case in maintaining standards and values. They have a difficult enough time in any case upholding the faith in a society which is dedicated to its destruction, and parents and religious organisations, either Catholic or Anglican, wanting to make sure that they have the best possible opportunity, should be encouraged. These amendments make it more difficult and I therefore believe that they should not be supported.
Lord Avebury
My Lords, I have seldom heard a more hysterical and inaccurate speech than the one that we have just listened to from the noble Lord, Lord Deben, which is clearly based on a total misunderstanding of the amendments and of the motives of the people who tabled them. I do not think he can have heard what the noble Baroness, Lady Whitaker, said in her intervention—that Amendment 85 and the other two amendments have nothing whatever to do with the choices that parents make of the schools that their children will attend. I hope that he will think carefully about the remarks that he has made and, perhaps, hesitate on future occasions to leap in with the wild assertions that he made today.
Baroness Garden of Frognal
I apologise to my noble friend, but under the rules of Report noble Lords may speak only once in the course of each amendment.
Lord Avebury
I had no objection to the noble Lord intervening, if that is what he was doing.
Lord Deben
I merely say to my noble friend that the point that I was making is that parents may wish to choose a school in which the restrictions on the choice of teachers expected under these amendments are not ones that they would wish. It is perfectly reasonable for them to choose those schools.
Lord Avebury
No one is suggesting that there should be any restriction on the right of parents to choose whatever school they think is best for their children. The noble Lord’s remarks are based on a total misunderstanding of the amendment and what the noble Baroness, Lady Turner, said. But perhaps I may move on to the remarks of the right reverend Prelate the Bishop of Oxford, who I thought said that these amendments were fine but unnecessary. I am hoping that he is in support of the amendments proposed by the noble Baroness, Lady Turner, because surely there may be teachers who are not entirely opposed to the faith basis of a school who belong to other religions or none but have a particular aptitude for mathematics, say, or geography, and are therefore suitable for those subjects in the school, although it has a religious ethos. He said, rightly, that the schools would want to choose persons who were best capable of teaching the non-religious subjects and that they would not wish to discriminate in making choices when appointing those persons.
I am afraid that we have made no more progress on the issues covered by the noble Baroness on religious discrimination than we did on collective worship since Committee, although, with the noble Baroness, I was grateful to the Minister for writing to us and entering into a detailed discussion with us in the interval between Committee and Report. The Minister will remember that he was handed a dossier of legal opinions, which the noble Baroness, Lady Turner, mentioned, including one commissioned by the Equality and Human Rights Commission that challenged the compatibility of the Schools Standards and Framework Act 1998 with the European Union employment directive. The focus of these opinions was Section 60(5). Looking back at the passage of this subsection through this House in 1998, I see that the original wording of the equivalent part of the Bill, then Clause 58(4), was entirely benign and unobjectionable. It provided that in a voluntary aided school of a religious character, no teacher of subjects other than religion would receive any less remuneration or be deprived of, or disqualified for, any promotion or other advantage by reason of his religious opinions or of his attending religious worship.
The amendments to that clause, to which we are now objecting, turned the original words on their head by saying that preference may be given, in connection with the appointment, remuneration or promotion of teachers at a voluntary aided school which has a religious character, to persons whose religious opinions are in accordance with the tenets of the religion or religious denomination of the school. Those amendments were drafted following a delegation to the Home Secretary led by the then right reverend Prelate the Bishop of Ripon and Leeds, who acknowledged in the House that the amendments had been,
“prepared in consultation with the Churches”.—[Official Report, 4/6/98; col. 576.]
He understandably expressed his delight that the churches were “completely satisfied” with the amendments then inserted. No other amendments were made by any other noble Lord.
Those proposals were made by the Church of England and accepted by the Government at the same time as the employment directive was being drafted in Europe to combat precisely that sort of unfair discrimination. They are the basis of the formal complaint lodged by the National Secular Society earlier this year to the European Commission, which I understand is still under consideration. If Section 60(5) is left alone, they may yet be the subject of litigation by teachers who consider that they have been treated less favourably than others in terms of their appointment, remuneration or promotion to posts involving the teaching of history, English or mathematics, for example, because they do not subscribe to the particular religion or denomination which gives the school its religious character. I suppose that the same would apply not only to Christian but also to Muslim schools, where a teacher might be discriminated against in the same way because he belongs to the wrong brand of Islam.
The then Government compounded the offence of undermining the directive by insisting, at the 11th hour, as a condition of their acceptance of the directive, that previous legislation, including in particular the School Standards and Framework Act, should be regarded as being in effect exempt from the new directive. The Government were so desperate for unanimous agreement, as was required, that they were able to force the Council of Ministers to accept their demands.
The noble Baroness, Lady Turner, has, on the grounds of pragmatism, gone only a modest way today to reverse these discriminatory 1998 amendments. I therefore appeal to the Government to recognise that these privileges granted to religious bodies create, as do all privileges, victims—those who would otherwise not have been disadvantaged. The innocent and undeserving victims of Section 60(5), which the noble Baroness seeks to replace in her Amendment 86, are teachers—there may be thousands of them—who are not of the faith of the publicly funded school or academy where they teach or apply to teach subjects other than religious education.
Lord Touhig
My Lords, I have some concerns about these amendments, in particular Amendment 86 in the name of my noble friend Lady Turner of Camden and Amendment 88 in the name of my noble friend Lady Massey of Darwen. Amendment 86 would dilute the existing legislative protection which allows Catholic schools to give priority to Catholics when recruiting to any post, without the need to provide justification for doing so. That has been a long established practice and it is essential that such preference is given to ensure that the Catholic ethos, which is the whole basis of having a Catholic school, is allowed to continue and to be maintained and developed. I suggest to my noble friend that the proposed subsection (5A) in her Amendment 86 is unnecessary since schools with a religious character are already obliged to comply with the Equality Act 2010, which includes appropriate exemptions for such schools.
Amendment 88 in the name of my noble friend Lady Massey of Darwen relates to voluntary controlled schools only. There are no voluntary controlled schools in the Catholic sector but this amendment would affect Church of England voluntary controlled schools which convert to academy status. These schools, which currently admit only a certain proportion of children of faith, would be prevented from increasing that quota except in specific circumstances. My fear is that if my noble friend's amendment was incorporated into the Bill it would pave the way for imposing quotas on all schools of a religious character. I do not think that is reasonable, right or just. From the point of view of the Catholic sector, this would certainly limit the ability of Catholic parents to send their children to Catholic schools. For that reason, I could not support my noble friend’s amendment.
Baroness Garden of Frognal
My Lords, this debate allows us to return to the topic of faith schooling. As we have made clear in previous debates, the Government believe strongly in the role of faith schools in this country. As we have heard from my noble friend Lord Deben, faith schools existed before there was a state education system and have contributed a great deal to its development. As the right reverend Prelate the Bishop of Oxford set out, it is vital to faith schools that they are able to maintain their particular religious ethos and their ability to deliver the form of education which they have historically provided, and which parents want. We think the long-standing arrangements that provide for this are working well. The Government are therefore seeking to ensure that faith schools which seek academy status continue to have the freedoms they have previously enjoyed, subject to the same protections.
Turning first to the issue of faith staffing, I am aware that the noble Baroness, Lady Turner of Camden, and indeed my noble friend Lord Avebury continue to have concerns with aspects of Clause 60, which seeks to replicate the staffing regime in voluntary controlled schools on their conversion to academy status. We are grateful for the discussions which the noble Baroness had with my noble friend the Minister on these issues and hope that the detailed letter sent to her and to my noble friend Lord Avebury on 5 October provided some reassurance on this matter. My noble friend referred to that letter in the course of his comments. We agree with many of the sentiments expressed by noble Lords today. The issues are really therefore more technical ones, about how these sentiments can best be given effect in law.
Baroness Turner of Camden
I thank all the noble Lords who have contributed to a very interesting debate. Of course, a lot of it I did not agree with, including the strange argument produced by the noble Lord who said that I was seeking discrimination; the reverse is true, of course. I was hoping to get agreement from everyone that, while accepting that there are faith schools and that people have the choice to send their children to these schools if they wish to do so, we should ensure that people who do not necessarily participate in support for that faith are not discriminated against. I thought it was quite straightforward, and I am very glad that a number of people seem to agree with that view. I thank everybody who participated, particularly the noble Lord, Lord Avebury, who as usual produced his very strong arguments in favour of the position that I had taken up on the employment of teachers and so on.
I thank the noble Baroness very much for the assurances she has given me this afternoon. I am glad—and I had the impression when I met the Minister originally—that there was no opposition to what I was proposing, and that it was simply felt by me and other people that we wanted it in this Education Bill. Obviously, teachers will refer to the Education Bill as their basis, so to speak, so I thought it a good idea to have it all in the same Bill. In view of what the noble Baroness has said this afternoon, I simply thank her very much for the assurances that she has given, which will be on the record. I am very grateful for them. In those circumstances, I beg leave to withdraw the amendment.
Lord Hill of Oareford
“( ) The Secretary of State will make available the apprenticeship offer, and will ensure that progress is made to ensure the offer is available, to all qualified persons by 2015.”
Lord Young of Norwood Green
My Lords, I shall speak also to Amendments 89ZZAA, 89ZZAB and 89ZZB. Before I get into the nub of the argument, I wish to remedy an omission. In Committee we failed to acknowledge the appointment of the noble Baroness, Lady Verma, and congratulate her on it. Better late than never; please accept our profuse apologies. I did make an extensive case in Committee—and the noble Baroness, Lady Garden, told me in an interval that it was verging on being too extensive—so she will be relieved to know that I will not repeat all the arguments. However, I believe these amendments to contain some very important principles.
To give some background: the first amendment is on the entitlement, committing the Government to make available an apprenticeship for all qualified young people in the 16 to 19 group by 2015, and is against the background of youth unemployment reaching record levels of nearly a million. Even if we take away those in full-time education, it is still historically a very high figure.
As I said in another debate recently, it is interesting that when young offenders were asked what one thing would contribute to changing their behaviour and way of life, a job, or the promise of a job, was probably the most influential factor. Again, as I have said previously, I welcome the Government’s commitment to apprenticeships—I believe that to be genuine—but the current strategy is failing. Its delivery is mainly to adult apprenticeships—that is, those in the 25-plus age range. I do not denigrate that, in one respect, because it is a useful means of people re-skilling, but it does not address the very serious problem of youth unemployment.
If we look at the most recent statistics, we see a decline in the increase in apprenticeships from 17.5 per cent to 10 per cent for 16 to 18 year-olds, and from 34.3 per cent to 22 per cent for 19 to 24 year-olds. In the very area which I regard to be the most vital area of apprenticeships, we are seeing a significant slowing down. Again, I do not want to go over the whole economic case, but we believe that if the Government had adopted Labour’s five-point plan to create jobs and growth, which includes a tax on bank bonuses to fund 100,000 jobs for young people, that would make a significant improvement.
Is it possible to meet the entitlement? Clearly, we believed it was, as a Government: we put it in the previous Apprenticeships, Skills, Children and Learning Act, and we made the commitment to achieve it in 2013. We recognise the difficult employment situation, which is why we have extended the target to 2015. Is it possible to achieve it? I believe the answer has to be yes.
When I looked at the Government’s response to this question, I must admit that I found it to be very cautious—that is the kindest euphemism I could put to it. It says that the Government will make “reasonable efforts” to secure that employers participate in the provision of apprenticeship training for all persons. I should hope that they would. But “reasonable efforts” does not really convey that sense of urgency, commitment and determination that we need, and that the Government need, if they are to signal to young people out there that they are determined to do something about the appalling levels of unemployment; and determined to show to young people that if they are able to qualify for an apprenticeship, there will be one available to them.
Baroness Verma
My Lords, I should like to speak to the government amendments in this group, tabled in the name of my noble friend Lord Hill. These amendments are the outcome of a great deal of work and good will on the part of the noble Lord, Lord Layard, and his colleagues, my noble friends Lord Wakeham and Lord Willis and the noble Lord, Lord Sutherland. I am extremely grateful for their efforts and pass on the thanks of my honourable friend the Minister for Skills, who heartily welcomes the amendments.
The amendments go to the heart of what needs to happen to expand the apprenticeship programme and create more opportunities. Amendment 89ZZB places a new duty on the chief executive of skills funding to “make reasonable efforts” to secure employer involvement in apprenticeship training for a broad class of people made up of all the groups covered by the apprenticeship offer. It also specifies that the guidance that the Secretary of State can issue to the chief executive must include guidance on carrying out that duty. It strikes the right balance between aspiration and pragmatism and complements the new duty on the chief executive of skills funding to prioritise funding, making the Bill even better legislation. Therefore, I urge your Lordships to support these amendments. I will of course respond to the noble Lord’s questions and arguments if other noble Lords do not speak.
Baroness Wall of New Barnet
My Lords, I, too, have put my name to Amendment 89ZZA. I welcome the opportunity to extend the congratulations that my noble friend Lord Young extended to the noble Baroness. I am sure she will be an asset to the team.
I just want to add to more or less everything that my noble friend said in the context of apprenticeships. What surprises me is the semi-reluctant manner in which the Bill is worded. It does not reflect at all the ambitions that the Government talk about in the goals that they have set to achieve apprenticeships or, perhaps more importantly, the way employers constantly remind the Government of the importance of apprenticeships. I know that my noble friend Lord Young referred to employers who still feel that apprenticeships are a burden. However, there are hundreds of employers who see them as an advantage to their businesses and have a real commitment to them. They feel that the Government may be saying one thing but doing another. That is, to say the least, very unfortunate, since apprentices are the core of major businesses.
My own experience is in the engineering sector, as noble Lords will know. Outside that sector, apprentices are now becoming much more important to the hospitality sector and others. Therefore, it surprises me that mixed messages are going out, the result of which is very confusing. I welcome what the noble Baroness said in responding to my noble friend. However, stronger language could be used in the drafting of the Bill—words such as “encourage” rather than “take note of” or other such phrases that are used in the Bill. Anything that can strengthen the enthusiasm that is out there is important.
My noble friend made particular reference to and emphasised the young apprentices who are coming in. There are major issues around young people not being able to engage with apprenticeships, although there are lots of schemes. I am certainly involved in one—the SEMTA Sector Skills Council, through its academy—that encourages young people to come off the unemployment register and works with SMEs to place those young people in businesses. There is a quid pro quo relationship in how that might be funded to give those young individuals a start in life. All the stuff that we hear about—the disruption that is often attributed to young people, and to which they contribute—really can be helped by individuals having a purpose. One of the things that I have found, as I am sure other noble Lords have, is that when you talk to young people who are on apprenticeships, they are absolutely delighted. When they come through them, they are even more thrilled. This is not about attracting a certain type of young person; it is about opening it up to everybody, because it is an opportunity. It is also an ambition for a lot of people. The country, as well as employers, needs these people,
I want to make a couple of quick comments about the other amendments in this section and about the procurements issue in particular. My noble friend referred to our Government’s intentions on this. Employers say to me and to people I work with, “You never see the Government doing this, yet we are being encouraged to do it”. If you consider the relationship between the SMEs and prime businesses, you would consider those people to be part of the procurement process; they buy from them and prime companies demand that SMEs have apprentice-trained people inside their businesses to ensure the quality of the product that they are producing on their behalf. We need some matching up of words—I was going to say rhetoric, but that is probably too harsh, given the way the noble Baroness has come back to us—to ensure that we are talking the same language and, more importantly, that these people have that opportunity. It is the Government’s policy to increase apprentices. We should be knocking at an open door when we have this discussion, rather than feeling that we are challenging them. I am delighted to be part of tabling this amendment.
Lord Layard
My Lords, I warmly welcome the government amendments that have been proposed, and I think the same goes for the noble Lords, Lord Wakeham, Lord Willis and Lord Sutherland, with whom I tabled a related amendment in Committee. Our aim was very simple; it was to ensure that there was a clear route to skill via an apprenticeship for young people who did not want to go down the academic route and, for this to become a well understood reality, that the National Apprenticeship Service had a clear duty to make reasonable efforts to ensure that the provision was there for all who wanted to take advantage of it. That is what this amendment now proposes.
I would have preferred a stronger duty on the National Apprenticeship Service, like the noble Lords who spoke earlier. However, I believe that this government amendment is a major step forward, and I pay a warm tribute to John Hayes, the Minister in the other place who is responsible for this, for his passionate commitment to apprenticeships and his vision in proposing this new clause. It is a major improvement in the Bill and it will be a major improvement in our whole educational system for 16 to 19 year-olds, although an even better one would be that proposed by my noble friends.
Lord Willis of Knaresborough
I support particularly Amendment 89ZZB in the name of my noble friend Lord Hill. I echo the comments of the noble Lord, Lord Layard, who has done a remarkable job in seeing this all the way through Committee and Report, and I compliment the Minister, and indeed his friend in the other place, John Hayes, for the way in which they have listened to the arguments. To have had an education Bill that did not actually mention apprenticeships was a mistake. It is always good when a sinner repents and comes forward with a confession. This is a confession that is worth noting. The Minister will go home happy tonight in that knowledge.
The whole move back towards an apprenticeship service is something that the previous Government should rightly be proud of. It was supported on all sides of the House, but it was an initiative that was long overdue. The fact that this week we have seen such a dramatic rise in the number of apprenticeships, despite the fact that we have a severe downturn in the economy—I will not say recession—is something that again we should welcome very strongly indeed. Apprenticeships are very much here to stay. I am delighted to be going up to Newcastle on 22 November to open a new apprenticeship centre organised by Siemens, which is trying to work with other employers in the north-east. That is the next step.
Lord Elton
I am encouraged to rise briefly after what my noble friend has just said. Something has been worrying me since I was Minister for Education in Northern Ireland back in the 1980s: the difference in esteem granted to academic and non-academic choices of our children going to school. It was forced on me because we were the part of the United Kingdom that did not sign up to the end of the 11-plus, so there was a very stark contrast. My job was to try to get parity of esteem between the grammar schools and the secondary schools. I have noticed that vein going on through education after the end of the 11-plus: the great esteem given to an academic career, even after it was the only entry into a white collar job.
It seems to me that the introduction and the success of the apprenticeship scheme is the answer to the problem that I was looking for 30 years ago. If we can give children, and in particular their parents and their parents’ generation, the perception that it is as honourable and as rewarding to follow a practical career as an academic one, it will have a great effect on the way the young of the future see the choices before them. We will get a proper balance socially, academically and economically where it is needed. I am very glad to support my noble friend’s amendment.
Baroness Verma
My Lords, I want to respond to the amendments tabled by the noble Lord, Lord Young, and of course to respond to other noble Lords. I thank very much all noble Lords who have welcomed the government amendment. The previous Government, and the noble Lord himself, did a great deal to make the apprenticeship programme what it is today and gave us a strong foundation on which to develop our skills flagship even further. I would like to take this moment to reassure the noble Lord that the Government understand and share his concern for young people’s interests that lies behind his amendment. Indeed, our own amendment, discussed just now, underlines that point. However, the original offer to which the noble Lord refers would have meant that the chief executive of skills funding would have had to find jobs with employers for all the eligible young people who wanted an apprenticeship. While it is a noble aspiration, in reality the Government and their agencies simply cannot tell employers whom they should employ.
The redefined offer in the Bill constitutes a more robust deal for the same young people because we know that we can deliver it. It sets the right balance between the employer-led nature of the programme and the need for support from government that young people can rely on.
The noble Lord’s other amendments propose making apprenticeships a condition of government contracting and Investors in People status, as well as requiring the Government to publish numbers and targets for public sector apprenticeships. I understand why the noble Lord has tabled the amendments and that he wants to ensure that government do everything in their power to encourage employers to take on apprentices, but a great deal is already being done to achieve this. I know that my honourable friend the Minister for Skills met the noble Lord, Lord Young, in September to explain this and has written to update him since. The Government believe fundamentally in a voluntary rather than regulatory approach. However, I know that the Minister has also reiterated to the noble Lord his determination to explore every opportunity to do more, provided that we do not put extra burdens on smaller employers and risk any breaching of the law. I would actively encourage the noble Lord to continue those conversations with my honourable friend the Minister for Skills or with me. My door is always open.
The noble Lords, Lord Layard, Lord Willis and Lord Elton, spoke about clear vocational routes for young people. I absolutely agree. For far too long we have undermined the great skills that come through apprenticeships. We want to make sure that young people who have an aptitude towards these skills—usually a very good aptitude—get as much support as we can provide. That is why, from the £1.4 billion in funding that we have put in for 2011-12, £800 million has been directed towards 16 to 18 year-olds. We are absolutely committed to ensuring that we work with employers to give young people—who, as was mentioned, may not be able to go straight into an apprenticeship—access and a pathway to prepare them better. We would still see them as apprentices and ensure that within a maximum of six months they were ready to take on a fully fledged apprenticeship.
The noble Lord, Lord Young, talked about the support for SMEs, GTAs and ATAs. Two-thirds of apprenticeship opportunities are offered by SMEs, which is why we want to make sure that we are supporting the SME sector by simplifying the systems and reducing the barriers so that SMEs are able to offer greater opportunities for apprenticeships.
It has been a great success story. In fact, I was really pleased to hear noble Lords say that. There has been an increase in apprenticeships, which is of course what we want. We know that apprenticeships are a wonderful route into skilled employment. However, we must not see them as a panacea for unemployment. The scheme is there to train and fill a need that employers have. As the noble Lord knows, these apprenticeships are employer led; they are developed by employers because they are at the heart of knowing what they need. It would therefore be futile for us to impose upon employers restrictions and regulations that would bind them to artificial targets and barriers.
We offer incentives to employers to recruit 16 to 18 year-olds. We know that it is crucial that we help them into employment, and the noble Lord is absolutely right to say that too many of them are unable to access it. That is why the Department for Education is fully funding its apprenticeships, and that is why we are there to support them absolutely. However, we must not forget apprenticeships for those who are older because they also need to be able to respond to the needs of the global economy as it changes. More than 100,000 employers offer apprenticeships. That is not enough and we want more to happen, but they are in 160,000 locations; two-thirds are offered by SMEs, which form 99 per cent of all businesses; and large businesses have the capacity to offer apprenticeships in larger numbers.
There is much to be done, but we are doing and building on what has gone before. I hope that I have been able to satisfy the noble Lord because I really believe that he and the Government share the same wish: to ensure that our young people and older apprentices all get an opportunity to contribute fully to the life of this country and, in turn, to the global economy. The Government’s amendments will further enhance the deal that we offer young people by prioritising funding for their apprenticeship training. I hope the noble Lord will feel encouraged that we want young people to start their careers on a sound and positive basis through apprenticeships—as, indeed, the noble Lord said. We differ only in our view on the most effective way to achieve that, but I am pretty certain that the noble Lord will feel sufficiently reassured to withdraw and not press his amendments.
Lord Young of Norwood Green
My Lords, I thank the Minister for her response and thank all those noble Lords who have participated in a profoundly important debate. The noble Baroness said in her first contribution that the government amendment strikes the right balance between aspiration and pragmatism. For my money, there is too much on pragmatism and not enough on aspiration. I do not quarrel with the direction but believe that the aspiration has to be stronger, and I shall develop that point.
I rarely disagree with my noble friend Lord Layard, and I do not disagree with him on this matter because there is a large measure of agreement between us. Of course I welcome what the Government have done. I do not want to be the party pooper and say that the government amendment does not make any improvement —it does, but it is not enough. It ducks the issue in a couple of important areas.
My noble friend Lady Wall talked about the record of many good employers, and that has been echoed through this debate. There are some brilliant employers. As you go around the country, you can find some wonderful schemes, but there are not enough. That is the real problem. You can muck around however you like with the statistics, but you are then faced with looking at the number of companies that take part—between some 4 per cent and 8 per cent, overall—and that is not exactly a staggering example. When only a third of FTSE 100 companies take part, we have a long way to go. Those are not my figures; I obtained them from Library research.
My noble friend Lady Wall was right to say that we need to open up, and indeed we did open up, apprenticeships—
Baroness Verma
My Lords, perhaps I may reiterate to the noble Lord that we are in economic dire straits, but still we have seen an increase in apprenticeships. We are seeing a way forward with businesses by making sure that they are doing their bit in taking on apprentices. We are simplifying the system whereby employers can take on more apprentices. It is unfair of the noble Lord to say that we are not doing enough. Against the backdrop that we have, it is a very positive sign that employers are taking on apprentices. Of course there is more to do. We will carry on doing it. However, it is ungracious to say that employers are not taking on apprentices.
Lord Young of Norwood Green
I tried to be measured in my words and I do not think that I have been ungracious: I acknowledged the progress that has been made. I do not want to get too much into an argument about the current state of the economy, as we are going to disagree about how it is being handled. On the entitlement question, I changed the date from 2013 to 2015 as an acknowledgement of the difficulties. However, youth unemployment is in a crisis situation, and crisis situations call for crisis measures. That is the point that I am making and I am not going to resile from that. Therefore, I do not think that it is a question of me being ungracious. There is a real difference of approach and—
Lord Willis of Knaresborough
I was about to refer to the noble Lord as the honourable gentleman. He is an honourable gentleman. I do not think that anyone in the House would deny the passion and commitment that the noble Lord, Lord Young, has for this area of apprenticeships. That goes without saying. However, I have to ask him a key question. What strategy will he undertake to force—that is what he is talking about—employers to take on apprentices? What will he do?
Lord Young of Norwood Green
I was coming to the noble Lord’s contribution and I was going to address that very word. I do not believe that you can force employers other than in one area. If, as an employer, you bid for a government contract, you have to indicate how many apprentices you are going to take on. That is what we said to those who bid for the Olympic contract and it is what we said in relation to Crossrail. I do not see any problem with that. Why on earth cannot the Government accept that commitment? If you want to do something positive that demonstrates the Government’s commitment, that is it. If I have to use the word “force” in that circumstance, so be it, as I believe that that is an intrinsic part of it.
The noble Lord, Lord Elton, made a very valid point. If we made a mistake as a previous Government, it was that at one point we emphasised the academic side so heavily that that somehow created the impression that the vocational or apprenticeship route was second class. It is not a second-class route; indeed, it is not an either/or choice, because many young apprentices go on to take degree courses as well. I have dealt on previous occasions with the question of ensuring that we give proper credence to the value of apprenticeships— I am conscious of the time.
Once again, the noble Baroness, Lady Verma, talked about extra burdens on SMEs. Requiring people to take on apprentices does not impose a burden on them. It is the employers who do not take on apprentices who often live to regret it when they find themselves suffering from a skill shortage. I do not see apprenticeships as some kind of panacea for youth unemployment but I do see them as an essential prerequisite in helping to resolve the problem.
I welcome the fact that the Government have made some progress but in our view it is not enough; more could be done. I make it clear that I shall wish to test the opinion of the House on Amendment 89ZZAA, which refers to procurement contracts, but, for the moment, I beg leave to withdraw Amendment 89ZZA.
“( ) With the objective of achieving the apprenticeship offer for all qualified persons by 2015—
(a) the Secretary of State will ensure that all government contracts require a clear commitment to apprenticeships; and(b) the Secretary of State will ensure that all government departments report regularly on the number of apprentices they employ and how many they intend to employ.”
Lord Young of Norwood Green
My Lords, I wish to test the opinion of the House.
Lord Hill of Oareford
“Securing the provision of apprenticeship training
(1) Part 4 of ASCLA 2009 (the Chief Executive of Skills Funding) is amended as follows.
(2) In section 85 (encouragement of training provision etc for persons within section 83)—
(a) for subsection (1)(a) substitute— “(a) make reasonable efforts to secure that employers participate in the provision of apprenticeship training for all persons who are within section 83(1)(a) or (b) or section 83A(4), (5) or (6);”;(b) in subsection (1)(b), for “training within the Chief Executive’s remit” substitute “apprenticeship training”;(c) in subsection (2), after “provision of” insert “apprenticeship”;(d) in the heading, for “Encouragement of training provision etc for persons within section 83” substitute “Provision of apprenticeship training etc for persons within section 83 or 83A”.(3) In section 118 (guidance by Secretary of State), after subsection (1) insert—
“(1A) Guidance under this section must include guidance about the performance by the Chief Executive of the duty imposed by section 85(1)(a).””
Lord Hill of Oareford
Lord Hill of Oareford
“Direct payments: persons with special educational needs or subject to learning difficulty assessment
(1) In Chapter 2 of Part 9 of EA 1996 (ancillary functions of local authorities) after section 532 insert—
“Direct payments532A Persons with special educational needs or subject to learning difficulty assessment
(1) A local authority in England may make a payment (a “direct payment”) for the purpose of securing the provision of any goods and services mentioned in subsection (2) to a person (“the beneficiary”)—
(a) for whom the authority maintain a statement of special educational needs under section 324, or(b) who is subject to learning difficulty assessment by the authority.This power is subject to subsection (3).(2) The goods and services referred to in subsection (1) are—
(a) where the beneficiary is within subsection (1)(a), special educational provision specified in the statement of special educational needs;(b) where the beneficiary is within subsection (1)(b) and the authority have arranged for an assessment to be conducted under section 139A of the Learning and Skills Act 2000, provision identified in the assessment as required to meet the beneficiary’s educational and training needs;(c) transport or anything else that may be the subject of arrangements under section 508B(1), 508F(1) or 509AA(7)(b) that apply in relation to the beneficiary.(3) A direct payment may be made only in accordance with a pilot scheme made under section 532B.
532B Pilot schemes
(1) The Secretary of State may by order make pilot schemes in accordance with which direct payments may be made under section 532A.
(2) Subject to the following provisions of this section, a pilot scheme may include such provision as the Secretary of State thinks appropriate.
(3) A pilot scheme must include provision about—
(a) circumstances in which, and the descriptions of goods and services in respect of which, direct payments may (or may not) be made;(b) descriptions of persons to or in respect of whom direct payments may (or may not) be made;(c) conditions with which a local authority must comply before, after or at the time of making a direct payment;(d) conditions with which a person to or in respect of whom a direct payment is or may be made may be required by a local authority to comply before, after or at the time the payment is made;(e) the principles by reference to which the amount of a direct payment is to be calculated;(f) circumstances in which a local authority may or must stop making direct payments;(g) circumstances in which a local authority may or must require all or part of a direct payment to be repaid, by the person to whom the payment is made or otherwise;(h) the monitoring of the making of direct payments, of their use by the persons to whom they are made or of the goods and services they are used to secure;(i) the arrangements to be made by a local authority for providing persons to or in respect of whom direct payments are made with information, advice or support in connection with direct payments;(j) treating such support to any extent as goods or services in respect of which direct payments may be made.(4) The conditions referred to in subsection (3)(c)—
(a) must include a requirement to obtain the written consent of the person to whom a direct payment is to be made before making the payment;(b) may include a requirement to obtain the written consent of one or more other persons before making a direct payment.(5) The circumstances referred to in subsection (3)(f) in which a local authority must stop making direct payments must include where the consent required by virtue of subsection (4)(a), or any consent required by virtue of subsection (4)(b), is withdrawn.
(6) A pilot scheme must include provision for a sum required to be repaid to a local authority by virtue of the scheme to be recoverable as a debt due to the authority.
(7) A pilot scheme may provide for paid-for goods and services to be treated as goods and services provided or arranged by a local authority in pursuance of a statutory duty specified in the scheme.
(8) A pilot scheme may provide for paid-for goods and services to be treated in that way—
(a) to the extent set out in the scheme, and(b) subject to any conditions set out in the scheme.(9) The only statutory duties that may be specified are—
(a) section 324(5)(a)(i) (duty to arrange special educational provision specified in statement of special educational needs);(b) section 508B(1) (duty to make travel arrangements for eligible children);(c) section 508F(1) (duty to make arrangements for provision of transport etc for adult learners);(d) section 509AA(7)(b) (duty to make, and secure that effect is given to, arrangements for provision of transport etc for persons of sixth form age). (10) “Paid-for goods and services” are goods and services acquired by means of a direct payment.
532C Pilot schemes: local authorities and duration
(1) An order under section 532B(1) making a pilot scheme must specify—
(a) the local authorities in respect of which the scheme operates, and(b) the period for which the scheme has effect.(2) The period specified under subsection (1)(b) must not exceed two years, subject to subsection (3).
(3) An order under section 532B(1) may extend the period for which a pilot scheme has effect, subject to subsection (4).
(4) The period for which a pilot scheme has effect may not be extended so as to end after the end of the relevant four year period.
(5) “The relevant four year period” is the period of four years beginning with the day on which the Education Act 2011 is passed.”
(2) In section 568 of EA 1996 (orders)—
(a) in subsection (3), after “other than” insert “an order to which subsection (3A) applies or”;(b) after subsection (3) insert—“(3A) This subsection applies to an order under section 532B(1) (direct payments: pilot schemes), apart from the first order to be made under that subsection.
(3B) A statutory instrument which contains (alone or with other provision) an order to which subsection (3A) applies may not be made unless a draft of the instrument has been laid before, and approved by a resolution of, each House of Parliament.”
(3) The provisions inserted into EA 1996 by subsections (1) and (2) are repealed at the end of four years beginning with the day on which this Act is passed.”
Lord Hill of Oareford
I start by setting out the context for this new clause. Our SEN and disability Green Paper set out the biggest programme of reform in education, social care and health support for disabled children and those with special educational needs in the past 30 years. Our proposals respond to the frustrations that children, young people and their families have with the current system and seek to give parents more control over the support that their family receives.
We said in the Green Paper that we would give every child with a statement of SEN or a new education health and care plan, and their family, the option of a personal budget by 2014. The evidence shows that a personal budget can give families more flexibility and empower them to make decisions about the support they receive. Families that took part in the individual budget pilot, which began under the previous Government, said that they feel they have more choice and control over the support they receive and better access to and greater satisfaction with services. We want to give more families access to personal budgets because of the evidence of the benefits that can bring. One element of a personal budget can be a direct payment to a parent or carer to buy a service or piece of equipment for their child. In those individual budget pilots, nearly two-thirds of families opted to have a direct payment as part of their personal budget.
I am grateful to the noble Lords, Lord Rix, Lord Low and Lord Touhig, and a number of external organisations, including the Special Educational Consortium for the work that they have done with us since the original draft clause and scheme was circulated in September. Their contributions have helped us to improve our plans for the pilots and we look forward to continuing to work with them. I also thank them for the work they have done with us on improving the system for complaints about schools. I have said that we will not commence Clause 44 of the Bill until we are confident that the department systems are right, and I look forward to working with them on that.
This new clause and the associated scheme would allow local authorities in our Green Paper pathfinders and the individual budget pilots to test the use of direct payments in education for children with SEN. I should stress that we are only proposing a power to pilot the use of direct payments. We can see benefits for children and families but we need robust evidence from the pilots of what works and how to avoid potential problems. The new clause is broadly based on the legislation that allows the use of direct payments for health, including many of the safeguards that this House secured during the passage of that legislation. I apologise to the House for the lateness of the amendment to the new clause, laid by the Government yesterday, which makes the first order setting out the detail of how the pilot will operate subject to an affirmative resolution. That relates to concerns raised by the noble Lord, Lord Touhig, and the Delegated Powers and Regulatory Reform Committee which recommended that this is an appropriate level of parliamentary scrutiny. I accept that view and hope that we will be able to secure time for that debate as early as possible to allow maximum time for the pathfinders to test direct payments.
There are also a number of safeguards contained in the scheme which sets out how the pilots must operate to ensure that children, families, and local authorities taking part in the pilot are protected. First, the pilots will be entirely voluntary for children, young people and families. The local authority must obtain written consent before making a direct payment, and this consent can be withdrawn at any time, in which case the authority must make other arrangements to make the provision. The making of a direct payment does not waive, suspend or repeal any existing statutory duties. Linked to this point, I would like to make it clear that all of the work of the pathfinders will take place within the current statutory framework.
The pathfinders will be required through the scheme to provide appropriate and effective information, advice and support to prospective recipients of direct payments. We have learnt from individual budget pilots that where this is done well, personal budgets and direct payments can be accessible to families from all backgrounds. The local authority will be required to monitor and review the use of the direct payments, and this will be in addition to their existing statutory duty to conduct an annual review of statements.
The purpose of the pilot is to gather information about what works in practice, so it will be evaluated as a distinct element of the wider evaluation of the SEN Green Paper pathfinders. The evaluation will capture information about the impact and effectiveness of direct payments, including cost-effectiveness; the processes local authorities establish to agree, quantify and cost the services to be delivered by direct payment; and potential barriers to delivery. We will ensure that it captures information on age, impairment, and type of need, as well as take-up by different socioeconomic groups. The pathfinder authorities will benefit from the expertise of the pathfinder support team, and they will work closely with the evaluators to provide support and specialist advice, and will help share any emerging learning, including that coming from the evaluation.
I hope that noble Lords will agree with me that direct payments for educational provision have the potential to improve the quality and the choice of support available to children with SEN and their families. There are, however, important and sensitive issues to address and it is right that we should test how we can make this approach work. That is what these pilots will enable us to do, and that is what this clause sets out to achieve. I beg to move.
Amendment 89ZZDAA (to Amendment 89ZZD)
Lord Hill of Oareford
“(3A) A statutory instrument which contains (alone or with other provision) an order under section 532B(1) (direct payments: pilot schemes)”
Lord Touhig
My Lords, by introducing these new clauses into the Bill the Government will allow local councils to test the use of direct payments for meeting special educational needs. I certainly welcome and support the greater personalisation of educational provision for young people as does the noble Lord, Lord Low, and the noble Lord, Lord Rix, who I know had some very fruitful and useful meetings with the Minister and his officials. Both noble Lords wished to be here this evening, but are unavoidably unable to be with us; they have asked me to mention to the Minister how much they appreciate the courtesy and the assistance he and his officials have given.
Direct payments have played an important role in allowing disabled people to have choice and control over the services they receive. Nevertheless, there are some significant risks in the use of direct payments in education, particularly in schools. The Department for Education has been working closely with the Special Education Consortium to mitigate these risks, and I know that the Special Education Consortium has certainly welcomed that collaboration and consideration. The matters they are still concerned about include ensuring that the pilot schemes must be set up by an order by the Secretary of State. Establishing the details of the pilot scheme within the legislative framework is a necessary safeguard if these significant changes to the way education is delivered are to be properly scrutinised by Parliament.
The order which establishes the pilots was originally to be the subject of a negative resolution. The noble Lord, Lord Low, and I tabled amendments to ensure these important changes were properly debated through an affirmative resolution procedure. We have withdrawn these amendments because the government amendment means the pilot schemes will be subject to the affirmative resolution procedure as the Minister told us this evening. This is very welcome, and we are grateful to the Government, particularly as the initial amendment on direct payments in education was tabled at such a late stage, as the noble Lord has explained.
The noble Lord, Lord Low, and I also tabled further amendments concerning the details of the scheme. However, as the order will now be subject to the affirmative resolution procedure, we believe these concerns might be more usefully spelt out and discussed in detail during that debate. These too have been withdrawn. Nevertheless, we would still like to put on record some of the issues we hope will be addressed by the order.
We need to know how to measure the reaction of education providers to individuals holding direct payments for special educational provision. This may interact with school and college finances and employment policies, and will affect the ability of schools to plan for all children with special educational needs. Perhaps the Minister will say what steps will be taken to ensure that the viability of specialist SEN services is not threatened where direct payments are taking money out of the system. We also need to know how decisions about the amount of direct payments will be made, particularly if statements are poorly written—there are examples of that as I am sure we all know—and how parents can appeal those poorly written statements. Finally, we need to know whether there will be a thorough evaluation of direct payments in education in particular before Parliament is asked to renew the order in two years’ time.
The noble Lords, Lord Low and Lord Rix, and I welcome the Government’s new position, but we urge the Minister to make debating this order a priority in the parliamentary timetable so that these proposals, which are rightly being tested, can be given the fullest opportunity to show their worth. Great progress has been made, and I have been asked by my colleagues—who are not able to be with us this evening—to say to the Minister in particular how much they and I and especially the Special Education Consortium have appreciated the fact that he has genuinely worked with us to try to resolve our concerns. This seems to be a better way to make law.
Lord Lingfield
My Lords, I particularly welcome this new clause because one of the most important items in it allows a continuation of funding post-16 and 18 to the age of 25. Many parents are dismayed that their “special education offspring”—as one put it to me—fall off the end of a funding cliff when they reach early adulthood, and this pilot will help us see much more accurately how this can be done. I hope, however, with the noble Lord, Lord Touhig, that the Government will set out very clearly how these experiments are to be monitored, so that best practice may be observed and reported. It is also important for the Government to make clear to parents what they should do if they want to challenge the amount of payments, and contend that the health or social service elements are too little. My view is that the clauses are necessarily restrictive, in that as I understand it parents frequently agree part-funding with local authorities, but are not to be allowed to supplement the amount of the direct payment to purchase the provision set out in a beneficiary statement. Perhaps the Minister would look at this again. However, I welcome this step in the right direction—albeit it is a small, pilot step—to alleviate the great problems that there are in the special needs sector. I look forward eventually to seeing the careful evaluation when it is published.
Baroness Sharp of Guildford
My Lords, like other noble Lords, I very much welcome these pilots and I am very grateful to the Minister for having listened to the Special Educational Consortium and others who have been talking to him about this.
I have been asked by the Association of National Specialist Colleges to raise two issues which possibly have already been covered by the discussions that have been held, but as I have not been party to those discussions I would like to raise them and seek assurances from the Minister. First, in the original draft of the pilot scheme there was a suggestion that colleges could be asked to return an element of the funding to local authorities in order for them to make a direct payment to the students who were already attending the colleges. The Association of National Specialist Colleges felt that this was overly bureaucratic and was a somewhat artificial approach to the pilots. The suggestion does not appear now in the published information, but it would be helpful to know whether it has been dropped or whether it is likely to be retained in additional guidance as the pilots proceed.
The second issue was one of transport, which has always been a major issue for those with special educational needs because local authorities are supposed to provide the funding for such transport and very often they have been derelict in their duties. A direct payment allows for students to pay for transport. The Association of National Specialist Colleges has significant concerns about the lack of transport funding for young people with learning difficulties or disabilities to get to both specialist and mainstream colleges. Unless there is a transport budget available for local authorities to include within the direct payment, it was concerned that the ability of students to pay for transport, as well as other requirements, would be impaired. They wondered, therefore, whether there was any way of ensuring that the local authorities had included an allowance for transport in the direct payment before there was any expectation that the students would be paying for that transport. Perhaps the Minister could clarify those two points so that they are on the record.
Baroness Jones of Whitchurch
My Lords, like many noble Lords in the Chamber, we welcome the direct payments initiative. It is right that it should be piloted and closely scrutinised. We will play our part in that. I hope that the Minister is able to reassure us that the outcome of the pilots will be fully debated by your Lordships' House in due course. I suspect that we will find that, as with many initiatives, it is the detail that matters and how the new powers are interpreted by parents and local authorities alike. We need clear advice and updates on how the pilots are working in practice. The outcome has to be an improvement in the provision of SEN services in schools and the pilots will need to demonstrate that all SEN children, not just those of middle-class parents, have an improved quality of service.
Noble Lords have raised a number of important questions in the short debate, but there remain some concerns that I hope the Minister will be able to help me with. Like the noble Baroness, Lady Sharp, I say that these points may have been covered in the discussions, but forgive me if I am not up to speed on some of the discussions that have taken place. First, how can we be assured that the payments will be enough to cover identified need so that the parents will not be expected to make up the difference from their own budgets? Secondly, how will other families be assured that other budgets will not be cut to fund these payments, thereby adversely affecting other services provided by the local authorities? Thirdly, how will the special position of looked-after children be protected? For example, foster carers will potentially administer the payments but might be perceived to have a conflict of interest, as they are also employees of the local authority. Lastly, on the level of support and advocacy provided to parents, which the Minister touched on, can he reassure us that that will be independent of local authorities because undoubtedly parents will find the system new, potentially difficult and overwhelming in terms of the choice and the bureaucracy with which they are faced? Perhaps he could clarify the level of independence that would be available.
A separate, procedural point is that we find ourselves, once again, tonight making policy on important issues on the hoof. These issues would have benefited from a longer period of consultation, both within the House and outside. The legislation, as drafted, has been placed in completely the wrong part of the Bill; it is in Part 7, which deals with post-16 education and I do not suppose that the Minister is suggesting that these payments are restricted to post-16. The Government should do better than this and, if they do not, they cannot complain when humble Back-Benchers follow their example and try to misuse the structure of Bills to put bits of legislation in the wrong place.
Notwithstanding all that, we support the intent of the Government’s proposals and we look forward to the future scrutiny which, we trust, will occur in due course.
Lord Hill of Oareford
My Lords, I am grateful for the broad welcome from all sides of the House for what we are attempting to achieve with these pilots and for what we are trying to do to get a better system for the most vulnerable children in the country from all backgrounds. As a number of noble Lords have made clear in their questions, there are a number of important issues to get right and that is the point of the pilots. We shall work through some of the issues that have been raised as a result of the pilots.
The noble Lord, Lord Touhig, and the noble Baroness, Lady Jones of Whitchurch, raised the issue of evaluation. There will certainly need to be very careful evaluation. We would want to share that with noble Lords. I was very grateful for the remarks made by the noble Lord, Lord Touhig, about the way in which we have managed to work with him, others and the Special Educational Consortium and I want that to carry on. The first evaluation results will probably arrive next April and there will be another report next September, but we want this to be an open process. I am very happy to share the findings as we go along and to work on ensuring that everything works as we want it to. As I said before, I think we are all agreed on the direction in which we want to go but, of necessity, difficult questions arise, some of which have been posed, about funding. The only way to answer those questions is to work through them with an open mind, and not to prejudge the outcome but to try to come up with solutions to them.
My noble friend Lady Sharp asked a couple of questions, first, on behalf of Natspec, in relation to the element of funding to local authorities. During the pilots, a local authority and a college will need to agree before a direct payment can be made. We think it is right to do everything possible to give students greater control over the services that they receive, so we are testing direct payments through these pilots to ensure that we learn everything about how to make them work in practice.
On transport, the pilots of direct payments will not affect current local authority duties or budgets, including those for transport, so if a local authority were to agree a direct payment for transport with a student, it would need to agree what the payment was for and exactly how much it would cost. My noble friend Lord Lingfield asked about top-ups: will parents be required to top up? The noble Baroness, Lady Jones, was concerned about that too. In no circumstances should the amount of the direct payment be set at a level that would require someone to pay from their own resources in order to secure part or all of the provisions set out in the child’s statement of SEN or the young person's LDA. If an individual wishes to purchase support that is additional to that needed to meet the assessed needs, it would be open to them to do so.
That links in to the question put by the noble Lord, Lord Touhig, about what is in the statement, as the statement determines what is delivered, how much things cost and so on. We know that local authorities are currently required to specify the provisions necessary to meet the needs of a child in the statement, but we also know that the quality of statements and learning difficulty assessments varies significantly. We think that the process of establishing a direct payment should, by itself, help in this regard because in order to make a payment to a family, the local authority would have to quantify exactly what provision is required. Our experience with the individual budget pilot supports this view, and parents report the initial discussions to establish a budget as one of the significant benefits of the overall pilot. I think that will help address that concern. So far as the question about the independence of the support is concerned, I will follow it up and write to the noble Baroness with more particulars on it.
I am grateful to noble Lords for the support for this. I hope it will mark a significant step forward. We hope these pilots will work.
( ) for the period until the first repayment is made, not in excess of the average cost of borrowing borne by the Government in the preceding financial year.”
Lord Stevenson of Balmacara
My Lords, Clause 72 amends the powers given to the Secretary of State in the Teaching and Higher Education Act 1998 to make regulations setting interest rates for student loans. As the legislation currently stands, Section 22 of the 1998 Act effectively provides that the interest rates set must be no higher than the rate required to maintain the value of the loan in real terms. If no repayments are made, the size of the loan increases in cash terms but remains fixed in value terms. Clause 72 gives the Secretary of State wide and substantial powers to set interest rates, but its intention is to move the policy of the Government away from where it currently is, and from where its independent adviser, the noble Lord, Lord Browne of Madingley, recommended it should stay. It will move us from the position of a zero rate of real interest to one in which the real interest rate would be 3 per cent above RPI.
We had a bit of a stushie in Committee about who said what and when about how many graduates are not expected to repay their loans in the future, which is an important issue as it has consequences for the taxpayer. According to the letter I received subsequently from the Minister, I did not misquote senior members of the Government on this issue. However, she went on to explain that the department,
“currently estimate that around 40% of full-time students could have some of their debt written off”.
She goes on, however, that this,
“remains an uncertain estimate and if OBR projections of inflation and earnings growth change this autumn, then the figure could change again. In December last year the IFS”—
a widely respected think tank—
“estimated that the proportion could be around 50 per cent and we accept that the true figure could range from 40 per cent to 50 per cent”.
So there we have it. Whether it is 40 per cent or 50 per cent or somewhere in between—my fear is that it will be on the higher side—it is a very large sum of money indeed to carry within the national accounts.
There are still issues on which we have not had an answer. The Browne report recommended that the interest rate should be set at the rate that the Government themselves can borrow money. What therefore is the justification for the figure of 3 per cent? Why RPI was selected, not CPI? Is the 3 per cent above the RPI rate of interest Sharia compliant? What assessment has the department made of the 10 per cent drop in student applications for 2012, and does it think that the drop is linked in any way to the high fees being charged?
I have discussed this issue with the Minister since my original amendment was discussed in Committee, and I am grateful to her for giving me time to go over my concerns. However, I feel very strongly that using RPI instead of CPI is wrong, and taking powers to impose rates of up to 3 percentage points above the RPI is penalising our young people and their families. It will exacerbate social divisions, and it may deter young Muslim applicants. It will generate a high level of individual debt, which will have to be repaid over a period of, say, 25 or 30 years, and is set in the form of a contingent tax liability. A positive real rate of interest will impact in particular on mature students. It is likely to have an adverse impact on female graduates and on men in the bottom decile of earnings. It is setting students off on a lifelong debt habit, and approximately half the loans are going to be written off. I still do not really understand how a policy can be supported when it is basically a tontine of very crude proportions: half those affected by it get their loan commuted to a grant, which then becomes a deadweight charge on the PSBR, simply because they earn too little to trigger any repayments and because they happen to live longer than 30 years after the due repayment date.
However, I recognise the pressures on the system and the need to recoup some of the costs. So I offer a late Halloween deal to the Minister: why not have one rate of interest for the period when young people are studying and a different one when they are earning enough to begin repaying what they have borrowed? The change in rate from constant value to a real rate of interest could be tied to the point at which they begin repaying. This is what is set out in my amendment. I hope this version of trick or treat is an attractive proposal for the Government, and I would be grateful if, in the event they cannot accept it tonight, they take it seriously and agree to have further discussions with me about it before Third Reading. I beg to move.
Baroness Verma
My Lords, the amendment moved by the noble Lord, Lord Stevenson, seeks to place a statutory requirement in the Bill whereby the interest rate at which borrowers are charged while they are studying and until their first repayment is no more than the government rate of borrowing for the preceding financial year. I thank the noble Lord for raising this issue, and I hope that he will find my response helpful. I will not put it in the context of trick or treat.
The current system provides borrowers who go on to earn the highest incomes with an interest subsidy while they are studying. This amendment is unnecessary because high-earning graduates are well placed to contribute to the cost of their higher education, and it also makes it unprogressive. The new arrangements that we are proposing mean that, in practice, the only people who are affected by the decision to charge a real interest rate while studying are those high-earning borrowers who pay back their loans in full. Those who do not fully pay back their loans will see that part of their borrowing written off. What is more, charging a real rate of interest is part of a progressive package of reforms, and any proposal to change this rate of interest should be considered in the round.
The changes that the noble Lord is suggesting would have a significant cost and impact on the sustainability of the new student finance package. Our analysis shows that charging students the government rate for borrowing—currently, RPI plus 2.2 percentage points—means that we would have to find a further £100 million per year. If we were to reduce this further, as has been suggested, to an interest rate of RPI only, while studying, or if we were to extend this rate until the student makes their first repayment, it would mean the costs would be even greater. The Government are committed to the progressive nature of the repayment system and want to ensure that those who earn most and can afford it contribute most towards the cost of their education. I am sure that the noble Lord does not disagree with that.
The noble Lord spoke about women being affected disproportionately. We estimate that around 35 per cent of female graduates will repay less than those on the current system. This is in large part because since women are more likely to be lower earners, they are more likely than men to benefit from the features of the progressive repayment system, including the protection afforded by the higher repayment threshold.
We do not want to have a negative impact on disadvantaged groups, and that is why the Government are committed to ensuring that our universities remain open to everyone with the ability to succeed in higher education. Our equality impact analysis indicates that our student funding reforms will not have a negative impact on protected groups. With our new repayment terms, we estimate that around a quarter of graduates— those on the lowest incomes—will pay less than they do on the current system.
The noble Lord asked about Sharia-compliant loans. We are actively investigating the possibility of introducing an alternative finance system and are working with organisations such as the Federation of Student Islamic Societies and the National Union of Students. We are clear that we want a single student loan system that can meet the needs of the majority of students, where possible. We will seriously consider proposals to change the administration or presentation of the system in ways that can address the doubts that members of some faiths might have about accessing student finance. However, any proposals would need to ensure that the overall financial outcomes for government are the same and that all student loan borrowers are treated the same in accordance with existing legislation. It is important to get this right, and I know the noble Lord agrees with me that it may take a little longer, but the outcome must be absolutely right.
The noble Lord raised the RPI/CPI question. No single measure of inflation is appropriate for all purposes. It is important to view the package of reforms in the round. We need a student finance system that is progressive, sustainable and affordable for the taxpayer, and that is what we have delivered. A measure of inflation that brought in lower contributions from the highest earning graduates would require us to be less generous with the progressive elements of the system that protect our low earners.
The Government’s student finance package is progressive and sustainable. It rebalances investment in higher education so that there is less public subsidy and a greater contribution from those who benefit the most. This can only be right. Our proposals create a system that provides more generous support for students from lower-income households and protects low-earning graduates. We believe that this is a fair deal. For those reasons, I cannot accept this proposal but I am very happy to continue meeting the noble Lord to discuss his concerns further.
Lord Stevenson of Balmacara
My Lords, I thank the Minister very much for that and in particular for her closing remarks about continuing the discussions. I think it would be worth having a further round of that. I gather there is a date now in the diary and perhaps we can pick it up at that point.
I would like to make three small points, and one at the end. First, it was good to hear that the difference in the cost to the public sector of going from 2.2 per cent to 3 per cent was only £100 million a year. I say “only” in a casual, flippant way—of course it is a lot of money, I understand that, but it is not a lot if one has to balance the impact and the damage done because of the increase. I think that is worth bearing in mind. I am grateful to have that information and I will think about it.
Secondly, the Minister said that the proposed changes will not have an adverse impact on admissions, but I think I am right in saying that the reduction in admissions reported last week was highest among mature students and women. That is a worrying sign. It may not be reflected when the full admissions figures come in, but even at this early stage of admissions, which is primarily for medicine, veterinary science and Oxbridge, those reductions are worrying and we need to bear them in mind.
Thirdly, on the point of whether or not the loans as currently proposed are Sharia compliant, I am grateful to the Minister for saying what she did on that. This is something that we perhaps could do by correspondence because we share a common wish that this works out well and that there is not an artificial or even a real division between the systems of loan that are appropriate across the whole country.
Finally, although it is fantastic that both full-time and part-time students who go on to higher education will be able to do so free at the point at which they enter the system, there is a price to pay for that. Underneath all the rhetoric, the truth is that this is a progressive system only because out of it will come a very large number of people—perhaps 50 per cent of the cohort—who do not earn enough to go on to a statutory repayment basis. It is a sort of race to the bottom and a crude way of depressing wages, and that cannot be right. There must be a better way of getting this across. If the progressive nature of this is really a way of separating out those who are benefiting from higher education and get more than the average wage in the country from those who do not, the phrase that is being used—those who earn more should contribute the most—begins to sound more like a graduate tax than anything else. Having said that, I hear what has been said tonight and I beg leave to withdraw the amendment.
Baroness Brinton
“Repayment of loans for part-time students
No part-time student shall be required to repay their loan until—(a) they have completed their studies, or(b) four years and six months has passed since the start of their course, whichever occurs first.”
Baroness Brinton
I rise to speak to Amendment 89ZA in my name. I thank the Minister for her letter of 25 October, in which she reports that the Minister for Universities and Science has agreed to accept that the statutory repayment date for all those studying part-time will be the April that falls four years after the start of their course. This seemingly small decision will have a very large impact on part-time students across the country, and I am absolutely delighted with the news.
The Open University has said it will make a significant difference to many of its over 200,000 students, and Birkbeck College has written to me to say that this is also very important for its non-traditional students, who are often juggling their study with work, mortgages and family commitments. I am also concerned that we need to ensure that the budget for widening participation, which the Government have provided this year and is being distributed by HEFCE, continues because these non-traditional students must get the right support to enable them to access the university courses that they need. I hope that the Government will ensure that the current HEFCE widening participation grant will continue beyond 2012.
I also thank the Minister for arranging a meeting with the Minister for Universities and Science later this week. I wish to raise with him the points I covered in Grand Committee, which also relate to the issue of part-time students repaying their loans. First, I am hoping for confirmation that the arrangements for part-time higher education students on fee loan repayments will also apply to the other new group of students now able to access loans to cover fees—that is, adult students over 25 studying a level 3 qualification, including but not only access to HE. That would, after all, be only fair and equitable.
Secondly, in Grand Committee I mentioned a letter from the Minister for Universities and Science to million+ at the beginning of September regarding the proposed government fee caps for part-time students, which may well leave universities and part-time students with an inadvertent problem. The impact assessment for the Education Bill says:
“The Bill also proposes to give the Secretary of State the power to specify in regulations the maximum tuition fee that higher education institutions (HEIs) may charge part-time undergraduate students in a given year. The level of the cap will be set through regulations, and the Impact Assessment will be published at that stage.
The current proposals for the cap, taken in isolation, will have no significant costs and benefits that can be monetised. This is because our analysis suggests that part-time course tuition charges do not currently exceed the maximum amounts proposed for the cap. The upper fee amount will be £6,750. The lower fee amount will be £4,500”.
This means that for part-time students there are proposed fee caps of £6,750 and £4,500, which relate to 75 per cent of a £9,000 full-time fee and 75 per cent of a £6,000 full-time fee respectively. This proposal assumes that part-time students do not study at more than 75 per cent intensity and that universities would be seeking to raise part-time fees excessively if the cap was higher than that proposed by BIS. This fundamentally misunderstands how part-time students study. In practice there is inevitably a good deal of flexibility in relation to the intensity of study, which may vary according to circumstance, such as work, family commitments and the number of modules that students have been able to study in previous years.
Part-time and full-time study are both based on modules and credits rather than percentage intensity. There are 120 credits in an academic year and it would be much more helpful for students if universities were able to charge these part-time fees on a pro rata basis linked to credits undertaken and the full-time fee set by the university for the course in question, with an eligibility floor of 25 per cent intensity. This would provide more flexibility for students and would be no more costly overall in respect of fee loans, especially since part-time students will not be eligible for maintenance loans or grants.
Pro rata charging would also ensure that there was equity of funding between full-time and part-time modes as well as transparency of costing. The most transparent costing methodology is credit based, but this will not work if students and universities are limited in how they deliver their courses. As well as being difficult for universities to administer, this arbitrary cap of 75 per cent could well have many perverse consequences. These could include students on the same courses and studying at the same intensity being charged different prices as a result of studying at different intensities in previous years. It could mean that students end up paying less or more than 100 per cent of their degree cost.
I am quite sure that the Government never planned for this law of unintended consequences to prevail, and I am looking forward to discussing this with the Minister and the Minister for Universities and Science later this week. I hope that we will be able to have a letter on this complex issue before Third Reading.
To end on a high note, and to make it absolutely clear to the Labour Opposition, who seem to have taken delight in mischievously not noticing when the Government have given significant ground on issues, I thank the Government for changing the fee loan repayment arrangements for part-time students, so that now they match the arrangements for full-time students. Our universities will now have a clear message that part-time higher education will be free at the point of study for the vast majority of students. I beg to move.
Lord Stevenson of Balmacara
My Lords, I shall also speak to Amendment 89ZA in the names of the noble Baronesses, Lady Brinton and Lady Sharp of Guildford, and myself. We are of course delighted that the Government have accepted that the statutory payment due date for all those studying part-time will be the April which falls four years after the start of their course. A potential injustice has been avoided and the change represents a step towards breaking down the barriers to part-time study.
Once this Bill becomes law, the situation seems to be that part-time fees are set to go up from about £1,000 per annum, which is the latest DES figure, to £6,750. Part-time students will not be eligible for maintenance loans or grants as they are at present but such students will have to borrow to pay the much higher fees that are going to be charged. I worry about this radical change to the current position and whether the existing range of part-time students, who are mainly mature, female and people who say that they missed out the first time around, will continue to enrol on part-time courses.
I have some questions to leave with the Minister. Why are the Government regulating part-time fees when the existing system seems to be working? If a university is setting a fee which it thinks the market will bear and the Government are prepared to extend its voucher system to part-time students, why put in an inducement to raise that fee, which will be hard to resist, to £6,750? Why not try it for a year or two and, if necessary, regulate at that point if it is not working?
As has already been said, not all university part-time course structures fit neatly across four years and not all students wish to study at the same level of intensity each year. It must be to the student’s advantage to study at the pace that best suits their lifestyle and commitments. Universities have reacted to that by becoming more flexible in terms of evening and weekend study, and study outside the traditional academic year.
Given that, I have some sympathy with the case that has been made by million+ that it would be much more helpful for students if universities were able to charge part-time fees on a pro rata basis linked to the credits undertaken and the full-time fees set by the university for the course in question.
HEFCE currently provides £368 million to institutions to support them with the additional costs of attracting and retaining students from the most deprived areas and those in receipt of disabled student allowances. The early years allocation from this fund has led it to attract 20 per cent of its newest students from the 25 per cent most disadvantaged communities in the country, 12,000 current students with registered disabilities and 18,000 students who access higher education through targeted access, taster and opening programmes. When the Minister replies, perhaps she will reassure us that the earmarked funding of this nature will continue. I look forward to hearing the answer to these questions.
Baroness Verma
My Lords, first, I thank my noble friend and the noble Lord for their warm welcome to the Government’s response. The amendment in the names of my noble friends Lady Brinton and Lady Sharp, and the noble Lord, Lord Stevenson, seeks to extend the repayment due date. I also thank them for championing this point and apologise for the delay in arranging a meeting with my right honourable friend the Minister for Universities and Science and myself. As noble Lords know, I take pride in delivering on my commitments and I am sorry that there has been this delay.
My right honourable friend has listened carefully to the debate in this House. He has considered all the arguments and has asked his officials to have those further discussions. While we are not able to accept the amendment as it was laid, I am pleased to confirm that through secondary legislation we will set the repayment due date for part-time students as the April which falls four years after the start of their course or the April after a student leaves their course if that is sooner. A letter has been laid in the House Library to this effect, and I am pleased to note that this change has been resoundingly welcomed by the sector.
My noble friend Lady Brinton asked about widening participation. To ensure a fair deal for poorer students, we have announced a new £150 million national scholarship programme to support students from disadvantaged backgrounds. I will write to my noble friend on HEFCE’s widening participation funding. I also hope that she and the noble Lord will take the opportunity later this week to discuss this and all other issues raised by noble Lords today with my right honourable friend.
My noble friend and the noble Lord asked about regulation. My noble friend proposes a more rigid system of regulation than that put forward by the Government. We do not believe that there is evidence that such a system is needed. Our proposals establish a common framework within which higher education institutions have flexibility to set their own pricing. They need to be sensitive to the level of pricing that potential students will bear. Part-time students may simply not accept charging over and above the relevant proportion for their full-time equivalent. Our proposals protect students by ensuring that their loan will cover the full amount charged and by securing investment in widening participation and fair access. We will of course carefully monitor the new system and, if we need to, we will review and revisit it.
The noble Lord, Lord Stevenson, asked about the regulatory burden. This cap will enable higher education providers to set their own charges as they do now but up to a maximum amount specified in regulations. We do not believe that this will cause an unnecessary regulatory or administrative burden. Our proposals establish a common framework.
I look forward to further discussions with the noble Lord, Lord Stevenson, and my noble friends Lady Brinton and Lady Sharp. This week, my right honourable friend will speak to them and I hope that we will have some fruitful discussions. Therefore, I hope that my noble friend will withdraw her amendment.
Baroness Brinton
I thank the Minister for her response and the noble Lord, Lord Stevenson, for his contribution. There is much agreement about the principle of the repayment of fee loans for part-time students. The other issues raised are complex and they sit beneath the primary legislation. I am grateful for the meeting to be held later this week and I am pleased that the Minister thinks that we can have fruitful discussions.
The only point that I would make is that neither myself nor the noble Lord, Lord Stevenson, think that we are proposing a tighter regulation base. In fact, the present system will constrain universities and students because it is rigid and, as I said earlier, may provide a law of unintended consequences where some students may bizarrely end up paying more than the cost of their course because of this structure of breakdown. Those are the discussions that I hope we are aiming for.
As I said at the end of my speech when introducing this amendment, I want to end on a positive note. I thank the Minister and the Government for agreeing to the principle of this amendment. I look forward to the revised legislation coming through and I beg leave to withdraw the amendment.
Lord Hill of Oareford
Lord Hill of Oareford
My Lords, I end with a whimper and not a bang. As noble Lords will recall, we agreed four government amendments when we discussed school inspections last week. Those amendments to Clauses 39 and 41 mean that, with the exception of the first set of regulations made under the new powers inserted by these clauses, regulations will be subject to the affirmative procedure. I refer to the amendments that I introduced in response to the points raised by the noble Lord, Lord Hunt of Kings Heath.
The two amendments before us are consequential to those amendments and were unfortunately overlooked. Amendments 89ZC and 89ZD make minor drafting changes to Clause 78, “Commencement”, so that it refers to the right subsections, including those applying the affirmative procedure. This does not affect the commencement of the clause. I beg to move.
Baroness Jones of Whitchurch
My Lords, I was trying not to get drawn into ending on a whimper as well. I was not going to say anything, because there is nothing to be said, except to thank the noble Lord for his courtesy so far. I look forward to Third Reading in due course.
Lord Hill of Oareford
“( ) section (Academy orders: local authority powers);”
“( ) section (Direct payments: persons with special educational needs or subject to learning difficulty assessment);”
NHS Commissioning Board Authority (Establishment and Constitution) Order 2011
(12 years, 6 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Baroness Thornton
That a Humble Address be presented to Her Majesty praying that the order, laid before the House on 15 September, be annulled (SI 2011/2237).
Baroness Thornton
My Lords, in moving the Motion on the NHS Commissioning Board Authority (Establishment and Constitution) Order 2011, I will also speak to the NHS Commissioning Board Authority Regulations 2011.
These statutory instruments were laid before Parliament on 15 September, and the date when they expire is therefore 10 November. However, the NHS Commissioning Board Special Health Authority website says that it was,
“established on 31 October 2011”,
and plays,
“a key role in the Government’s vision to modernise the health service”.
Technically speaking, the NHS Commissioning Board has not jumped the gun by broadcasting its existence before the parliamentary process has been completed. However, given the whole way in which the change agenda for the NHS is progressing, there is an extent to which I feel our views may not count for very much at all, and may count for less as time goes on.
I would like the Minister to clarify whether there was a period of consultation before the order was laid, because I can find no evidence of it. I am aware that there was a statutory period of consultation with the staff unions during the summer under Section 28 of the National Health Service Act 2006. I am also aware that there was a consultation on the White Paper published last year. However, I am not aware that the decision to establish a shadow authority was taken or mentioned during that consultation.
The Explanatory Notes to the statutory instruments make play of the fact that the Future Forum said in its deliberations that the NHS Commissioning Board should be established as soon as possible. However, I do not regard the deliberations of the Future Forum as a substitute for a properly managed consultation involving all the bodies that have an interest in this matter. The Future Forum is a body with no official or statutory status or accountability to Parliament. Its members have not been appointed through the Nolan procedures and do not even need, for example, to register their interests. Praying them in aid of an order before Parliament is slightly odd.
The procedure for putting in motion important statutory instruments such as this should not be treated in a cavalier manner. Indeed, it is so important that there was an exchange of letters between the noble Lord, Lord Goodlad, the chair of the Merits of Statutory Instruments Committee, and the Leader of the House, the noble Lord, Lord Strathclyde, last summer when a matter of consultation was clarified. In answer to a question from the noble Lord, Lord Goodlad, about the consultation procedures, the Leader of the House said:
“The Government recognises the best practice established by the Code of Practice on Consultation and will continue to observe it wherever possible”.
I am concerned as to whether the code of practice was adhered to in this case, and if not, why not.
This order outlines how the proposed new commissioning architecture for the NHS might be delivered, so it is of huge importance. I would like some assurance from the Minister that, as we move forward with other orders pertaining to the Bill, proper consultations will take place.
Today, as the NHS Commissioning Board commences a period of shadow running before becoming fully operational, the emergent commissioning architecture has become far more complex. The paper developing the NHS Commissioning Board offers some insights as to what a very complex organisation is being developed. Between the NHS Commissioning Board at one end and the clinical commissioning groups at the other, the variety of commissioning support agencies is growing exponentially to include regional—I think I need to amend that to subnational—arms of the NHS Commissioning Board, PCT clusters, commissioning support units, clinical senates, special clinical networks, health and well-being boards and trustees of clinical commissioning groups. Public Health England, local health improvement boards, regulators such as Monitor and the Care Quality Commission, the National Institute for Health and Clinical Excellence, local GP councils, third sector suppliers, and individual practices that are enrolled as clinical commissioning group members can also be added to this list. Indeed, patients too are becoming commissioners, as they wield personal health budgets.
This is presumably the structure to be delivered by the shadow board. I do not object to being properly prepared for these huge changes—that is very wise. However, there are some very important questions to be considered about the statutory instruments before us today. Can the Minister confirm what the timetable is, subject to the passage of the Bill? My understanding is that October 2011 is the start date for the board in shadow form as a special health authority, although the word “shadow” appears nowhere that I could find on the website. Given that the board has already recruited its chair—a matter that I will return to in a moment—can the Minister tell the House how and when other board members will be recruited, and whether the Department of Health will be using the same company of head-hunters that recommended Professor Malcolm Grant? Can he confirm that another five board members will be appointed? I am asking because I am not clear from Regulation 6 of the NHS Commissioning Board Authority Regulations, on the suspension of non-officers, as to whether that includes the chairman. I can see that it deals with the situation of the suspension of the chairman, but I am unclear as to how the chairman might be suspended in the first place, and by whom.
If the shadow board is to run from October 2011 to October 2012, I gather that at that point it transmogrifies into an executive non-departmental public body responsible for planning for 2013-14. I ask the noble Earl: is that it then? Is that the status of the quango being created to run this part of the National Health Service? We know that strategic health authorities and PCTs will be disestablished in April 2013.
I have a series of questions arising from the timetable, and I am sure other noble Lords will have as well. I am going to limit myself to two main themes, accountability and cost, after which I will have a few questions about the appointment of Professor Malcolm Grant. What powers does the NHS Commissioning Board have at this point and what budget? How many people are employed by it at present, how many will be employed by it eventually and at what cost? We know that the board will be responsible for £100 billion of taxpayers’ money. When will they start disbursing that funding and what accountability measures will have been established before April 2013, or indeed before October next year? Am I right in thinking that from yesterday the board has been established as an independent statutory body with some accountability, such as the authorisation of clinical commissioning groups? If this is indeed the case, does the new board have control of the budgets that develop the clinical commissioning groups? How will it disperse that funding? Who will be responsible for the strategic health authorities and PCT boards and their continuing delivery of healthcare in their areas? Who will be responsible for the delivery of the Nicholson challenge while Sir David Nicholson is busy, presumably, with all of the above?
I turn now to the appointment of Professor Malcolm Grant, whom I know from my work with academic organisations in the past. I have the highest respect for his current position as the head of University College London, but I think he was put in an impossible position by the Department of Health. I have now read the transcript of his interview with the Health Select Committee, where he was approved only by the casting vote of the chairman. It seems clear to me that Professor Grant had been told that it was a rubber stamp exercise and that he did not expect to be cross-examined in the robust way in which the Health Select Committee proceeded to question him—a way that we all know and cherish, particularly when a Select Committee may suspect that it might be being taken for granted.
It is unfortunate that Professor Grant was unable to explain why or if he had a passion for the National Health Service. He said:
“I find it difficult to demonstrate because I am not a patient of the NHS”.
Will the Minister take this opportunity to clarify exactly what was meant by that remark? It has had negative media coverage because it has been interpreted as meaning that Professor Grant does not use the NHS at all. That is most unfortunate.
According to the record, Professor Grant instead pointed to his 37-year marriage to a central London practice GP as his experience of the NHS. I am married to a world expert on internet safety, but it has given me neither a passion for nor a particular knowledge of IT and the internet. Much as I support my husband in his work, I am not at all sure that it is good practice to use that in a job interview. However, it raises a separate question: did the department take legal advice about whether Professor Grant’s GP wife makes him a relevant person in terms of conflicts of interest? Given that GP primary care will be dealt with directly by the NHS Commissioning Board, which I understand is to have responsibility for GP contracts, will Professor Grant have to exclude himself from any discussions and decisions that might be to the advantage or disadvantage of GPs? What a curious state of affairs that would be. In fact, the whole episode is curiouser and curiouser.
I agreed with Professor Grant in his remarks to the Select Committee about the health Bill, which he thought was completely unintelligible. I suspect that the Minister may not. I look forward to the Minister’s remarks because I know that I will be wiser as a result. I beg to move.
Lord Warner
My Lords, I agree with everything my noble friend has said. In particular, I would like to know when the shadow becomes substance.
It is unfortunate that we are considering these statutory instruments before we have had a chance in Committee to discuss the clauses of the Bill relating to the NHS Commissioning Board. I shall try not to trespass on the ground that we will undoubtedly cover in the Bill, but there will inevitably be some overlap.
The board’s main role is to ensure a coherent and effective commissioning system as a proper counterbalance to the NHS’s historical dominance by provider interests. In considering these statutory instruments, it is important that we are clear that this is its main role. If it is to succeed in using commissioning to improve patient health outcomes, not only individually but across populations, it will be vital that the board is not sidetracked by being given other roles that Ministers cannot find other homes for. We will discuss these issues further, but can the Minister give some assurances today that we will not end up with a situation in which the board’s empire continues to grow and its membership may not be the most effective to deal with the range of circumstances and problems that it has to deal with? Can he give an idea of the scale of the board’s budget and staffing issues?
I always travel optimistically when I see a government department produce an impact statement and I always hope that there might be the odd number or two in it. However, in these statutory instruments, the numbers are conspicuous by their absence. I would therefore like to explore with the Minister what the scale of the board’s budget and staffing will be.
It is very difficult to judge whether the governance arrangements for the board in regulations such as these are satisfactory without knowing a lot more about the scale of the operations. Could the Minister give us more information about what he anticipates the budget of the board will be in its first year of operation? Again, we are less than certain precisely when that first year of operation will be, but for argument’s sake let us fix on either 2012-13 or 2013-14—I personally do not mind which. I would like to know what he thinks this body will be responsible for in cash terms and to have some idea of what he thinks its running costs will be. We will certainly be coming back to this issue as the Bill progresses in Committee, but it would be helpful to have some idea of the scale of this body’s operation before we can judge whether the provisions in the regulations on membership of the board and the way in which it is going to be run are adequate.
This request for numbers is not just a matter of idle curiosity on my part. It relates to the question of what is the most appropriate size for this board and its committee structure. From what we have learnt so far, the board seems likely to have responsibility for spending at least £80 billion a year. I have heard figures of up to 5,000 staff being bandied about as the possible number of people that the board will employ. With an annual expenditure of this size, my first question to the Minister is: is it right to be thinking about having a board with only five non-executive members? How does this compare with a FTSE 100 company with a similar turnover? With such a turnover each year, what is likely to be the scale and nature of the committee and sub-committee structure that the board requires? Is there a danger that, with only five non-executives, the board will end up with committees or sub-committees taking decisions on large sums of public money where board non-executives are in a significant minority in those decision-making committees? Certainly at first blush, the governance structure for the large sums of public money that this board will be disposing of looks potentially weak compared, for example, with a big local authority. Are the Government sticking with five non-executives or do they contemplate having a larger number of non-executives on this board?
Having made this comparison with local government, I will turn to the issue of the board and its committees meeting in public. As I understand the regulations, there is no requirement for the board or its committees to meet in public other than when the board presents its annual report. Given the sums of public money likely to be involved, this seems to me totally unsatisfactory. As someone who was a chief officer in a big local authority for six years, I thought it was good for my soul to have to argue my case in public. I think most members of elected local authorities accept that their way of having to account for large sums of public money is to talk about how it is going to be spent and to account for it in a public arena. I cannot see why this board should not be required, as a matter of course, to meet in public and conduct its discussions in a transparent way, except where perhaps personnel or commercial issues are involved. Can the Minister say why the regulations do not require this, when the Government themselves tend to make rather a song and dance about how they prefer there to be much more transparency in public bodies?
Finally, I turn to the issue of board competence and training. I was a little startled to learn of some of the answers provided to the Health Select Committee by the Government’s candidate to chair the board. Of course, there was a refreshing honesty, as my noble friend has said, about the way he described the Bill as “completely unintelligible”, and many Members of this House seem to agree with him, judging by the number of amendments that they have put down. However, more puzzling was his understanding of the board’s relationship with the Secretary of State under the terms of the mandate provisions in Clause 20 of the Bill. He seemed to believe that the Secretary of State would hand over the mandate for two or three years and then leave things to the board. Clause 20 makes it absolutely clear that the Secretary of State can issue a fresh mandate before the beginning of each financial year as well as modify it, particularly when there are exceptional circumstances. The Secretary of State also has extensive powers in Clause 17 to issue regulations that lay down standing rules on how the board conducts its affairs. Can the Minister tell us more about the arrangements for induction training of non-executives and their chair, so that there is no misunderstanding on the part of the non-executives about what the board can and cannot do?
I could go on because there were many other issues that were raised, but I will save those for Committee. In conclusion, I regard these regulations as looking somewhat feeble for a body operating on the scale that the Government seem to envisage and in such a complex environment. We will come back to some of these issues in Committee. In the mean time, I would welcome the Minister’s answers to my questions.
Baroness Barker
My Lords, reading these regulations, I was taken back to 2008, when the then Government set up the Care Quality Commission. We had a set of regulations that were not dissimilar to these to start the process of establishing that board. The CQC became operational on 1 April 2009; its chair was appointed on 15 April 2008 and spent a year in the process of setting up that body. Noble Lords who took part in the legislation around that discussion will remember that we had not begun the Committee stage when the chair was appointed, and there were in subsequent weeks major discussions about the role of the CQC board, its objectives and its composition, all of which were subsequently translated into legislation and regulations and which today carry through into the CQC.
Echoing some but not all the questions asked by the noble Baroness, Lady Thornton, and the noble Lord, Lord Warner, I too want to ask the Minister whether, as with the setting up of previous bodies, it is the intent that there should be an initial process when a basic structure for establishing the body takes place, and whether it will be added to and changed as the legislation governing the body goes through Parliament. I too want to know whether this board will be required to meet in public, if that is the outcome of the debates that your Lordships are due to have in the next few weeks on the legislation. Also, is it a de minimis position to have five members? That might well be changed in future. Like the noble Lord, Lord Warner, I want to understand the scale of the budget and staffing structure that this board has to oversee.
Can the Minister say more about conflicts of interest? In these regulations, we have a clear but standard definition of conflict of interest, which is about pecuniary interests of board members. This board is going to operate in relation not just to the Secretary of State but to clinical commissioning groups, which opens up the capacity for there to be different conflicts of interest other than direct pecuniary ones, which I imagine that the Government can foresee and would wish to prevent. Would it be reasonable for noble Lords to assume that as the legislation progresses matters like that will be decided and will be the subject of further regulation?
Finally, how long does the department believe the process of transition will take and who will be responsible for monitoring the cost of the establishment of what I take to be a shadow board, which, as I said, is not an unprecedented step for a Government to take in a matter such as this?
Lord Turnberg
My Lords, many of the points that I might have raised have been raised by my noble friends, but I still have some concerns and quite a lot of confusion as to what this body will do. Will it have budgetary responsibilities from day one and, if not, when will it start having some responsibilities for the huge amount of money at its disposal? What controls will be placed upon it? If it is going to meet in public only occasionally, who will hold it to account if things seem to be going wrong? What role will the Secretary of State play if it does not seem to be delivering what it should? It has an enormous set of responsibilities. Will it have sub-committees or will it be decided, among the five non-execs and others, how it will go about its business? I find the whole thing rather confusing at this stage. It would be nice to have some clarity and I hope that the noble Earl will be able to give it.
Lord Willis of Knaresborough
Perhaps I might say first to my noble friend that I support and appreciate the idea of bringing forward a special health authority to shadow the new Commissioning Board. That is right and proper but, like other noble Lords, I think the idea of doing that is a little confusing before we have had a chance to examine this proposal in Committee, and to test it against the large number of amendments which are coming in to tease out what role the Commissioning Board will ultimately perform and what its form and functions will be.
I do not want to add to the questions asked by my noble friend Lady Barker, the noble Baroness, Lady Thornton, and the noble Lord, Lord Warner, all of which I am sure the Minister will get to in his response, but I particularly want to raise one issue with my noble friend. It is the question of research; he will not be surprised that I have raised that. In another place, the Government conceded that research ought to be put into the Bill and that it will be a duty not only of the Secretary of State but of the Commissioning Board and commissioning groups to promote research. At the moment, research within the NHS is of course promoted by the Chief Medical Officer of health, who has responsibilities for the National Institute for Medical Research. To be fair, I think that Sally Davies carries that job out very well indeed. She has done a remarkable job since the Cooksey report and the setting-up of OSCHR with the identifying of resources within the NHS for research. We are starting to see the fruits of that work; indeed, during the passage of the health Bill I hope to be able to speed up the process of getting a special health authority for research and, ultimately, a new research authority.
However, will this shadow authority have a duty to commission research? In which case, will that budget be within the £80 billion to £100 billion identified by noble Lords? Will it in fact take over the duties currently held by the Chief Medical Officer, Sally Davies, or will she continue to retain them and report to the Commissioning Board? In short, where will NHS research reside and who will have authority for it in making the decisions within the new arrangements?
Baroness Finlay of Llandaff
My Lords, I too would like to ask a question in relation to conflict of interest. As the noble Baroness, Lady Barker, has said, it seems that conflict of interest is much more likely to be in the non-financial sphere than the financial sphere. Would members of the board be expected to declare it, perhaps particularly in relation to their own health and that of members of the family who may be affected by commissioning decisions? Also, who will the Commissioning Board be required to take advice from in its commissioning decisions and who will it be required to work with? Will education and training, just as with research, actually become a core duty of the Commissioning Board at the outset or will it come along later? I note that it is said that this is a transition process and that the Commissioning Board will ultimately have responsibility for primary medical services. However, I would be grateful if the Minister could explain at what point that transition will occur, whether it will be phased across the country gradually or happen all in one go, and what plans are being made for the potential risks that can occur with such a major transition of funding from the current system, with the whole of primary medical services being taken over by the Commissioning Board.
The Parliamentary Under-Secretary of State, Department of Health (Earl Howe)
My Lords, I welcome this, the second in a series of debates tabled by the noble Baroness, Lady Thornton, scrutinising various pieces of secondary legislation which together are intended to provide continuity and security to NHS staff, as well as maintaining the continuity and quality of NHS services, and delivering the £20 billion efficiency challenge.
This second debate provides an opportunity for me to set out the need for a proposed new preparatory body to ensure the most effective transition to a new system for commissioning NHS services. As noble Lords will know from our debates on the Health and Social Care Bill, a key part of the Government’s agenda is to turn the NHS into a more patient-centred organisation, with a clearer focus on improving patient outcomes, and designed around the needs of the local population.
The Government intend to create a more autonomous and accountable NHS, with greater clarity about the roles and responsibilities of different organisations for provision of commissioning. A stronger, more effective commissioning system is necessary to support the improvement in health outcomes that we all want to see. An autonomous but accountable NHS Commissioning Board is a key component in the realisation of this objective.
The NHS Commissioning Board will be rigorously held to account by Ministers and Parliament as a whole for delivering improved patient outcomes instead of top-down process targets. While it will be free from interference on a daily basis from Ministers, it will have clear duties set out in primary legislation, and will be held to account for objectives set by the Government through an annually refreshed mandate, giving it a clear long-term direction.
The board will allocate resources to clinical commissioning groups and support them to commission services on behalf of their populations, according to evidence-based quality standards. It will directly commission services in six areas: specialised services, primary care, specialised dental services, military health, prison health and some aspects of public health. It will develop a high-quality market for commissioning support, while minimising redundancy costs, living with reduced running costs and retaining the best of NHS talent. This means that the board will be at the centre of delivering improved, patient-centred services while cutting waste and bureaucracy.
It is essential that we get this right. With this in mind, the NHS Future Forum has recommended that,
“the NHS Commissioning Board should be established as soon as possible to ensure focused leadership for improving quality and safety as well as meeting the financial challenge during the transition”.
This shows that there is a recognised need to begin work now to ensure that the transition arrangements to the new system allow the NHS Commissioning Board to undertake its full responsibilities from the day it is established.
The NHS Commissioning Board Authority, as established in the statutory instruments that we are debating tonight—as well as the functions which were not laid before this House, but noble Lords may have seen earlier this week—is a preparatory vehicle, which will allow the organisation to recruit a leadership team; establish robust governance processes; develop an open and supportive ethos and culture; and begin to develop some of the key relationships with other organisations in the system. It will take on only limited functions, delegated by the Secretary of State for Health, with regard to the health system during the course of 2012.
The authority will ensure that the NHS Commissioning Board is able to function as intended as soon as it is established as an executive non-departmental public body, subject to the passage of the Bill. The authority will help the NHS to manage some of the challenges of the transition from the current system to the new one. Through establishing a body at arm’s length from the department, we can ensure robust accountability and governance arrangements.
There will be a letter from the Secretary of State setting a series of objectives that the special health authority will be expected to deliver. In addition, there will be a framework agreement defining the relationship between the Department of Health and the authority. This provides a level of transparency that would not have been present had this preparatory phase been handled wholly in-house. The authority will have an accounting officer who will be accountable to the department, and the Public Accounts Committee, giving Parliament and the Secretary of State for Health clear access to officers responsible for the major decision-making within the board.
Establishing an arm’s-length body also allows us to recruit a strong leadership team, who can provide strategic input and challenge. Wherever possible, we have drafted the establishment legislation for the special health authority to reflect the legislation that noble Lords have been scrutinising in this House. This has been done to build in continuity wherever possible, particularly around the balance of the board. Officials have sought and received the approval of the Appointments Commissioner to roll over the key non-executive director appointments to provide continuity of leadership as the body moves from being a preparatory one to an operational one, subject again to the passage of the Bill. The preparatory arrangements will ensure that the culture of national and local accountability is embedded in the board from an early stage, and does not see the centrally administered, top-down, performance-managed culture merely transferred into the board on the date of establishment, by transferring all staff and working practices on day one.
We have taken our administrative responsibilities extremely seriously during this process. We have been careful to balance appropriately the need for transparent and accountable preparatory arrangements, while ensuring that we still respect Parliament’s role in scrutinising the legislation for which these regulations prepare. Establishing a special health authority at this stage does not pre-empt the Bill’s progress through this House. It is intended as a short-term measure. The Secretary of State for Health can abolish the authority, subject to consultation with staff and parliamentary scrutiny. We are working to ensure that the costs of establishing the body are kept to a minimum, and the body will employ only staff whose roles are considered business-critical to its preparatory functions. The Government are committed to creating an NHS that is able to shape health services that are patient-centred and locally accountable. The NHS Commissioning Board Authority is a key step in this process.
I shall now address the specific questions raised by noble Lords in this debate. I was very grateful to my noble friend Lady Barker for reminding the House of the legislation passed under the previous Administration in relation to the establishment of the CQC. That is not an unreasonable comparator to the present situation. The orders before us do not pre-empt the outcome of the scrutiny of the Health and Social Care Bill. There are good reasons for establishing the authority now. They are, in sum, to ensure strong governance around the organisation’s preparations; to identify and induct a strong, independent board who could lead the NHS Commissioning Board, subject to the passage of the Bill; and to provide an important signal to the NHS about the future.
I say to my noble friend Lord Willis that this legislation is not subject to the successful passage of the Bill. It is a supporting measure, which could be reversed or amended as necessary, subject to consultations with affected staff. The functions of the authority, which are outlined in directions issued by the Government, could be updated as the Bill progresses.
The NHS Commissioning Board Authority was established as a special health authority yesterday. As I say, it will have a preparatory role and will be replaced by an executive non-departmental public body by October 2012, subject to the passage of the Bill. It is expected to be fully operational by 1 April 2013.
The noble Baroness, Lady Thornton, asked me about consultation on the setting up of the special health authority. Section 28 of the NHS Act 2006 is the basis for establishing special health authorities. The Act requires consultation with staff, which was carried out. It does not require consultation with others. As stated in the government response to the Future Forum report, the authority—the preparatory body, in other words—will continue operating until the provisions of the Bill relating to the establishment of the board are brought into force some time between July and October 2012. Only at this point will the full executive non-departmental public body be established with responsibility for establishing and authorising clinical commissioning groups. This would be followed in April 2013 by the executive non-departmental public body taking on its full suite of statutory responsibilities. The special health authority would therefore only have a preparatory role; it is currently envisaged that it will exist for a maximum of one year. The noble Baroness, Lady Thornton, asked a number of questions about the powers of the special health authority: how many would be employed; how many would be recruited and at what cost.
In order to prepare for the establishment of the board, we have established this authority with the purpose of developing the details around the processes and relationships required to carry out the board’s functions, developing the business model, and making such other practical arrangements that are necessary and appropriate for the effective running of the board on its establishment, including developing HR and governance models. I would simply say to the noble Baroness, Lady Finlay, and indeed my noble friend Lord Willis that that encapsulates the functions of the authority. The functions of the board are of course subject to the passage of the Bill and not dealt with in the orders that we are currently considering.
As regards staff, the publication of the NHS Commissioning Board People Transition Policy in July 2011 gave staff in relevant bodies, including PCTs, SHAs and arm’s-length bodies in the Department of Health, a description of how the NHS Commissioning Board would manage the transfer of functions and staff from other organisations. While further detailed work will need to be undertaken during the preparatory phase on the detail of transition, the People Transition Policy was able to set out how transfers will be managed and appointments will be made. The chair, as the noble Baroness mentioned, has been appointed—Professor Malcolm Grant. Other non-executive board members are recruited by the Appointments Commission; however, the department has used the intelligence gathered by the recruitment company to aid this process. The chair will lead the recruitment of other board members.
Recruitment to the NHS Commissioning Board is being managed in two phases. This phased appointment process will allow the senior leadership team to help take the NHS Commissioning Board forward, together with their support teams and some key transition and priority roles, while more of the work on the detailed structure is carried out. The immediate priorities for appointments as part of the first phase for recruitment are: first, the senior team and their support staff; secondly, the transition functions; thirdly, functions that have early deadlines; and, fourthly, transfers from organisations that may not be sustainable until October 2012.
The noble Lord, Lord Warner, asked about induction training of non-executives and the chair. An induction process has been developed for the chair by the authority transition team. It will also be adapted for the non-executive directors. The noble Lord also asked a series of questions about the budget of the board during its first year; what it will be responsible for in terms of that budget and about the number of non-executive directors.
The preparatory NHS Commissioning Board Authority has access to a transition budget of up to £6 million during the financial year 2011-12 to establish itself and to undertake consultation and analysis to design its future functions. This excludes staff costs and capital expenditure on estates and infrastructure—
Lord Warner
That was not the point of my question. It was what the board budget was going to be, so that we knew what this authority was preparing itself for. I am not frankly very fussed about the odd million or two going to this authority. I am more concerned about how it prepares itself for the transition to the board if it does not know what the expenditure and scale of the board’s operation is going to be.
Earl Howe
My Lords, I appreciate that and I was coming on to providing him with the answers to those questions. The impact assessment published alongside the Bill includes an analysis of the costs and benefits of establishing the NHS Commissioning Board. Preliminary estimates for the annual running costs of the board are in the region of £400 million. That budget will, of course, be partly dependent on the detail of secondary legislation that will be subject to parliamentary scrutiny.
The noble Lord expressed concern that we should not end up with a board that is too large and with the wrong membership for the remit placed upon it. We need here to distinguish between the role of the authority and that of the board. The authority has a clearly defined preparatory role. It is not responsible for commissioning in the NHS but rather for preparing for the establishment of the NHS Commissioning Board. The board will, when fully established, be responsible for the £80 billion commissioning budget.
As regards who will sit on the board when it is in its fully fledged form, the Health and Social Care Bill sets out details of the proposed membership of the board, including a chair and at least five non-executive directors, along with fewer executive directors than non-executive directors. The Secretary of State will appoint the chair and non-executive directors, and has identified Sir David Nicholson as the first chief executive designate. The board will appoint the executive members other than the first chief executive. As an autonomous body, the board will be free to appoint board members and, in turn, other staff below board level.
The noble Lord, Lord Warner, asked me to outline what the board will do with the money that it receives from the Government. The board will directly commission a wide range of services, including local primary care and the most specialised services in the country—meaning that the board will have direct responsibility for around £20 billion of commissioning spend. It will be accountable nationally: for the outcomes achieved by the NHS, which will be set out in the Government’s mandate to the NHS Commissioning Board; for contributing to improving broader public health outcomes; for how the NHS commissioning budget of around £80 billion is spent; and for maintaining financial control across the system.
As regards how the NHS Commissioning Board Authority will be held to account, the authority will operate in line with the establishment order, regulations and directions set by the Secretary of State. The Secretary of State will issue a letter as guidance under the directions setting out more specifically the priorities against which the special health authority board will be held to account. The Department of Health’s Permanent Secretary is its principal accounting officer. She will appoint the special health authority’s chief executive as its accounting officer. The principal accounting officer has responsibility to Parliament for overall expenditure in relation to the department and its arm’s-length bodies—thus making sure that an overall system of control is in place for ensuring proper stewardship of public funds and the issuing of grant in aid to the special health authority.
The noble Lord, Lord Warner, referred to the issue of the board meeting in public. The authority is not required to meet in public. The board is required to meet in public, subject to the passage of the Bill— I refer the noble Lord to paragraph 7 of Schedule 5. The authority is a preparatory body, and there is therefore a stronger case for the board rather than the authority to meet in public. The framework agreement between the department and the authority that we expect to be published in the coming weeks includes a commitment by the authority to carry out its activities transparently.
My noble friend Lord Willis asked whether the shadow authority will have a duty to commission research and whether it will take over the duties of the Chief Medical Officer. The authority, as I think I have made clear, will not commission research. The NHS research strategy policy will remain in the Department of Health until the board is established. The board, as my noble friend knows, will be under a duty to promote research.
The noble Lord, Lord Turnberg, asked further questions about the accountability of the board and the role of the Secretary of State, and whether there will be sub-committees. The executive officers of the authority and the board will account to their chair and the board. The Department of Health will hold the authority and the board to account. The Bill places the Secretary of State under a duty to keep the performance of the board under review—that is stated in Clause 49. The Secretary of State will set an annual mandate for the board, and the board is also accountable to Parliament in its annual report.
The noble Baroness, Lady Thornton, referred to the appointment of Professor Malcolm Grant as the chair of the authority. Professor Grant was selected as chair of the NHS Commissioning Board because he was the best candidate for the job. His experience as the head of an internationally respected organisation such as UCL means that he is highly qualified, and his appointment is backed by the Health Select Committee. I understand that when he remarked to the Health Select Committee that he was not an NHS patient, he was simply referring to the fact that he is not ill and is therefore not currently an NHS patient. I understand that he is registered with an NHS practice.
I think that I have covered all the questions that have been asked of me. I have certainly endeavoured to do so but if I have failed to answer any, I shall of course write to noble Lords.
Baroness Williams of Crosby
My Lords, perhaps I may just draw the Minister’s attention to the point raised by the noble Baroness, Lady Finlay, concerning pecuniary interests. In Regulation 13(4) of the NHS Commissioning Board Authority Regulations, there is an indication that the Secretary of State may be able to decide that somebody suffers from a disability because of his pecuniary interests. From that, can we assume that if any member of the authority has a pecuniary interest in a particular contract or a particular outcome, he or she will be expected to make their interest absolutely clear and to excuse themselves from the decision?
Baroness Thornton
My Lords, I thank the Minister for that very comprehensive answer to the debate. I also thank all noble Lords for their contributions to what I think was a very worthwhile discussion. I particularly thank my noble friends Lord Warner and Lord Turnberg. The questions put by my noble friend Lord Warner were, of course, as forensic as I would have expected. I did wonder about the lack of an impact assessment being attached to the order and regulations.
In response to the noble Baroness, Lady Barker, I did not object to the fact that the chair has been appointed in advance. Indeed, I completely took the point that it is happening at almost exactly the same stage in the passage of the Bill as occurred with the appointment of the chair of the CQC. However, my concern relates partly to the lack of consultation. We conducted a consultation at every single point of the CQC being set up. We carried out a statutory consultation right the way through the establishment of that body. The fact that the Government were not bound to have a consultation prior to the establishment of this authority is not an excuse for not doing so. This authority will lead to the establishment of a board which will spend £90 billion or £100 billion of taxpayers’ money. Therefore, it seems important to have a consultation at every point, partly because the more that people understand organisations, the more that helps to build support for them.
The noble Lord, Lord Willis, is quite right to raise the issue of research. These Benches certainly support that, if that is not the kiss of death.
The noble Baroness, Lady Finlay, raised a crucial point about conflicts of interest. I am not at all sure that the Minister answered my question about legal advice on the position of the wife of the new chairman of the authority being a GP but I am quite happy to let him write to me about that. On that basis, I beg leave to withdraw the Motion.
NHS Commissioning Board Authority Regulations 2011
Baroness Thornton
That a Humble Address be presented to Her Majesty praying that the regulations, laid before the House on 15 September, be annulled (SI 2011/2250).