House of Commons

Wednesday 7th December 2011 Commons Chamber

Wednesday 7 December 2011

The House met at half-past Eleven o’clock

Prayers

Wednesday 7th December 2011 Commons Chamber

[Mr Speaker in the Chair]

Oral Answers to Questions

Wednesday 7th December 2011 Commons Chamber

The Secretary of State was asked—

[Bob Russell (Colchester) (LD)]

1. What progress his Department has made on the proposals for an airport on St Helena.

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

A contract has now been signed for the design, construction and operation of the new airport in St Helena. We expect it to open towards the end of 2015, in time for the 200th anniversary of Napoleon’s exile to the island.

[Bob Russell]

I thank my right hon. Friend for that excellent news. I also thank my hon. Friend the Member for Milton Keynes North (Mark Lancaster), whose visit to the island helped to pave the way. Does the Secretary of State agree that the islanders will rejoice at this decision by the coalition Government, which contrasts with the failure of the last Labour Government who, at the last moment, cancelled the contract?

[Mr Mitchell]

My hon. Friend is right to say that this is the right decision. It underlines our commitment to the overseas territories—they are British. He is also right to tease the Opposition about the fact that they dilly-dallied over this decision for nearly 13 years.

[Meg Munn (Sheffield, Heeley) (Lab/Co-op)]

I welcome the decision to go ahead with the airport, which I argued for long and hard, as the Secretary of State is aware. What does the decision to go ahead with the airport, which will ensure that the people of St Helena can stand on their own two feet, mean for the ship and for the continuing contact that is needed with the island? Will that be able to continue until 2015 and will extra repairs be needed?

[Mr Mitchell]

I acknowledge that the hon. Lady played a strenuous and forceful part in the decision today. She argued strongly for the airport when she was in government. The ship will be able to continue until the airport is largely able to take over its necessary role. She is right to underline the importance of this decision in getting the island off aid and off the British taxpayers’ books, and looking after itself.

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

2. What assessment he has made of the development needs of the Republic of Moldova.

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

The Department for International Development’s bilateral programme in Moldova came to a planned end in March 2011. Moldova has made progress in reducing poverty since it gained independence in 1991. It benefits from significant support from the international community. DFID continues to monitor development progress in Moldova through UK representation on the European neighbourhood programme management committee.

[Alun Michael]

On a visit to Moldova a while ago, we had the opportunity to go to Transnistria and to see the courage of the women working with non-governmental organisations to combat the scourge of people trafficking, which has implications for us and for the whole of Europe. What can the Minister tell us about the approach of the British Government, and will he do more to help those non-governmental organisations?

[Mr O’Brien]

I pay tribute to the right hon. Gentleman’s continued interest and support through the all-party parliamentary group for Moldova. Although there are now formal talks to seek to resolve the protracted Transnistrian conflict, he is right to draw the House’s attention to the continuing concern about trafficked women. He will know that across Government there is a series of initiatives focusing not only on identifying and supporting such women, but on stopping the sources of those who peddle this heinous practice.

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

Will the Minister commend the work of the Westminster Foundation for Democracy in Moldova, both on a party-to-party basis and in parliamentary strengthening, particularly in the run-up to the presidential election on 16 December? Is not good governance the fastest way to tackle poverty?

[Mr O’Brien]

My hon. Friend is right to demonstrate, through the work of the Westminster Foundation for Democracy in Moldova, how important good governance is in alleviating poverty and in creating the conditions that all countries need to have the greatest possible opportunity for wealth creation and security. Of course, we all look forward to the Moldovan Parliament being able to elect a President soon, which will allow the Parliament to focus on the reform agenda that is necessary to bring Moldova closer to the EU. I am happy to pay tribute to the work of the WFD.

[Julie Hilling (Bolton West) (Lab)]

3. What recent assessment he has made of the work of the global fund on HIV/AIDS, tuberculosis and malaria in developing countries.

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

The multilateral aid review assessed the global fund as providing very good value for money, but also concluded that it could do more to maximise its potential and impact in developing countries. We are working closely with it to ensure that that happens.

[Julie Hilling]

In view of the current concern about the global fund, will the Secretary of State clarify the UK’s current and future financial commitment to the organisation?

[Mr Mitchell]

We have made it clear that we are willing, subject to the improvements that we have set out, to spend up to £1 billion by 2015. We are currently spending about £128 million a year on achieving very specific results under the global fund, and I am considering whether additional funding would be warranted. I shall make that decision on the basis of value for money for the British taxpayer.

[Oliver Heald (North East Hertfordshire) (Con)]

Many of the 2,000 a day who die of malaria are children. Will the Secretary of State and his Department take a particular interest and show particular determination in tackling childhood mortality, particularly in developing countries? Will he extend that to rotavirus and the other conditions that kill so many children?

[Mr Mitchell]

My hon. Friend is absolutely right. It is a scandal that 25,000 children will die today, needlessly, of diseases that we have the power to prevent. Tackling child mortality is absolutely at the heart of the policies being pursued by the Government.

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

Will the global fund actively target the countries where the HIV problem is prevalent and worsening?

[Mr Mitchell]

My answer is yes. We will be working in the most difficult countries. The aim of the review currently being undertaken under the chairmanship of an excellent British official, Simon Bland of the global fund, is to ensure that over the next four years we save 10 million lives and prevent something like 180 million new AIDS, malaria and TB infections.

[Andrew George (St Ives) (LD)]

Given that more than two thirds of TB and malaria programmes and more than half of all antiretroviral drugs are delivered through the global fund, what does the Secretary of State say about the crisis in the talks on that programme and its cancellation until 2014? What interim measures can be put in place?

[Mr Mitchell]

It is true that the 11th round has been converted into a new funding approach, but we will sign grants between now and 2013 of something like $10 billion, so long as we can ensure that our priorities of securing lower prices and good value for money, focusing on the poorest and most vulnerable and considering the longer-term sustainability of programmes, are met.

[Tony Cunningham (Workington) (Lab)]

Given that the global fund contributes half of spending on HIV/AIDS, 80% of spending on malaria and 75% of spending on TB, what steps has the Secretary of State taken to ensure that all international donors play their part? Does he see any possibility that the global fund will start distributing resources before 2014?

[Mr Mitchell]

The hon. Gentleman is exactly right to focus on the importance of getting others to meet the commitments that Britain is meeting. I can tell him that I spend a lot of my time ensuring that that happens. We will disburse something like $10 billion before 2014 and, as I have said, we are looking to secure funding after that date so that these programmes continue and are sustainable.

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

4. What steps his Department is taking to support developing countries to deal with tax evasion.

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

The Department for International Development and Her Majesty’s Revenue and Customs support developing country tax authorities in a range of reform and capacity-building projects to help them to collect the tax that they are owed. We particularly wish to promote developing countries’ participation in international exchange of tax information, which is a powerful weapon against tax evasion.

[Diana Johnson]

Developing countries lose more money through tax dodgers than they receive in aid. Will the Minister explain exactly what was said at the G20 summit to get the issue moved up the agenda?

[Mr O’Brien]

The hon. Lady is absolutely right to say it is vital that we address uncollected tax, particularly in certain countries that have been identified. We are encouraging international partners to join in that, and our own Treasury has been very much in the lead. The G20 has agreed to the multilateral convention on mutual assistance in tax matters, and that is what it is now focusing on in trying to get an exchange of tax information, which will help us to support countries in collecting the tax that they are owed.

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

5. What recent assessment he has made of the priorities for development in Bangladesh.

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

British development in Bangladesh promotes resilience to national disasters, gets girls into school, tackles maternal mortality and helps the Government to raise their own revenue through support for fair and transparent taxation. I plan to visit Bangladesh shortly to ensure that British taxpayers’ money is well spent.

[Eric Ollerenshaw]

Having seen some of that work that the Secretary of State’s Department is doing in Bangladesh, may I first congratulate him on it? More specifically, what help does he think his Department could provide, perhaps alongside other Departments, to ease the political logjam that seems to bedevil Bangladeshi society from top to bottom?

[Mr Mitchell]

My hon. Friend has seen for himself why the issue he raises is so important. A key part of our work is helping ordinary people to hold their political leaders to account, which we do through strengthening accountability and the Government’s ability to raise taxes, and through strengthening local media. I have recently given a significant accountability grant to the BBC World Service Trust to do just that.

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

Climate change is having a serious impact on food security and production in Bangladesh—the production of rice and wheat is forecast to fall by around a third by 2050. What additional resources or funding will be made available to help some of the poorest in the world, given the effect of climate change on their food production?

[Mr Mitchell]

The hon. Gentleman is entirely accurate about the effects of climate change on very vulnerable people in Bangladesh, where only a fairly small rise in the water level could wipe out hundreds of thousands of homes. We are directly involved in protecting 15 million vulnerable people from those effects of climate change, and we will continue—through, for example, the development of scuba rice, which grows in very difficult circumstances—to target malnutrition.

[Toby Perkins (Chesterfield) (Lab)]

6. What steps he plans to take to assess the value for money of aid expenditure on climate change projects.

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

Value for money is a process, not a one-off event. The value for money of climate change projects is assessed during design and appraisal, during implementation and, for a sample of completed projects, through evaluation.

[Toby Perkins]

It is vital at this time that we get absolute value for every penny we spend, but the Minister will be aware that 70% of CO₂ emissions come from developed countries, whereas the World Bank estimates that 80% of the damage will be suffered by the developing world. After the Durban climate change conference, what steps will be taken to ensure that new and additional clauses are not dropped from climate change financing?

[Mr O’Brien]

The hon. Gentleman is absolutely right to imply that the effects of climate change have a continually damaging effect on the poorest people of the world. Therefore, we hope that the discussions that have taken place in Durban will produce the success and the architecture that are required. However, there have been some announcements, particularly as part of Fast Start, to help people from developing countries around the world to adapt to the effects of climate change. That will be through the UN adaptation fund or the least-developed countries fund, and will be particularly for climate resilience programmes in both Ethiopia and Kenya. There is therefore a significant focus on the poorest.

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

With the Durban climate change conference coming to a close this week, will the Minister tell the House what impact he and his Department have had on shaping Britain’s negotiating position, and whether the Government will live up to the commitment to help to fund the additional $100 billion needed for climate finance for developing countries?

[Mr O’Brien]

I thank the hon. Lady for drawing attention to that key aspect, but in focusing totally on results and achieving the genuinely transformational climate change effects that we want, this Government have absolutely stood by our promise to meet the requirements to fulfil the international climate fund— the responsibility is split between the Department for International Development, the Department of Energy and Climate Change, and the Department for Environment, Food and Rural Affairs. There has been a series of announcements. We are now two thirds of the way through the Fast Start commitment, so the answer is yes, our commitments are in place.

[Nadine Dorries (Mid Bedfordshire) (Con)]

7. What estimate his Department has made of the number of people living in poverty in Equatorial Guinea.

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

Although Equatorial Guinea has one of the highest per capita incomes in Africa, nearly 70% of the population live in deep poverty. Most of that per capita income goes to the President and his family and cronies.

[Nadine Dorries]

I declare an interest. My visit to Equatorial Guinea in the summer was paid for by the Equatorial Guinea Government.

The Secretary of State is quite right to say that one family control the wealth of Equatorial Guinea and are amassing an unimaginably vast fortune from drilling rights and oil revenue. Will he use his good offices to press upon the Obiang family the fact that the wealth of a nation belongs to its people, and that they should be using that money to alleviate poverty, particularly among children in Equatorial Guinea?

[Mr Mitchell]

My hon. Friend makes a very good point. She has been there and so is in a good position to speak out about what she has seen. I should say to her that we do not have any bilateral links with Equatorial Guinea, but she is right: it is a disgrace that its high level of oil wealth is stolen for the corrupt and personal use of an unaccountable and self-serving elite.

[Martin Horwood (Cheltenham) (LD)]

The Secretary of State rightly draws attention to the risk of corruption in Equatorial Guinea. Is it not the kind of country that could benefit from the legislation that is currently being proposed at European level to make extractive companies publish what they pay in developing countries along the lines of the Dodd-Frank Act in the United States?

[Mr Mitchell]

My hon. Friend makes a very good point, although he, like me, will be sceptical about our ability to persuade a country to do that. We have, however, raised the issue of Equatorial Guinea’s abusive human rights with the Human Rights Council in Geneva, in particular the lack of an independent judiciary, the use of torture and the death penalty and the constraints on the media.

[Mr Laurence Robertson (Tewkesbury) (Con)]

8. What recent assessment he has made of the humanitarian situation in the horn of Africa; and if he will make a statement.

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

In spite of significant British-led support, the position in the horn of Africa remains extremely difficult. The coming of the rains has brought some improvement, not least because of British-funded vaccination programmes for more than 916,000 children. I am gravely concerned by recent reports that al-Shabab has ordered 16 humanitarian organisations to cease operations in Somalia.

[Mr Robertson]

I thank the Secretary of State for that response. Does he agree that quite often the conflict, particularly in countries such as Somalia, is the root of the problem, and what can he do to remedy that?

[Mr Mitchell]

My hon. Friend rightly points to the fact that the Government are focusing on countries that are mired in fragility and conflict. It is one of the reasons why the Prime Minister has decided that Britain should host a conference on Somalia to try to ensure that we tackle the causes of state failure as well as the symptoms of it.

[Mr David Crausby (Bolton North East) (Lab)]

Is the Secretary of State satisfied that the Kenyan invasion of Somalia will not hinder the distribution of aid?

[Mr Mitchell]

It is clear that there are a large number of difficulties, including the disposition of forces in Somalia, which hinders the distribution of aid. The biggest hindrance of all is the work of al-Shabab, which has kicked out 16 aid agencies. We are now very reliant on the International Committee of the Red Cross and two British non-governmental organisations, Save the Children and Oxfam, for getting relief through to an enormous number of very malnourished children who are in danger of dying as a result of this famine.

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

9. What recent assessment he has made of the humanitarian situation in refugee camps in Sri Lanka.

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

About 7,500 displaced people remain in camps in Sri Lanka, out of about 300,000 at the end of the conflict in 2009. British humanitarian aid for displaced people in Sri Lanka ended in March 2011, except for demining work which will continue until 2013.

[Tom Brake]

I thank the Minister for his response. May I ask him to intervene on behalf of the refugees who are still left in the Menik Farm refugee camp to ensure that they are allowed to return to their homes rather than to a 600-acre plot of newly cleared jungle?

[Mr O’Brien]

I greatly appreciate the importance of that issue. The work being done through the conflict prevention pool to help to bring peace in Sri Lanka includes assisting with police reforms and strengthening Sri Lanka’s diasporic communities—some of which are in my hon. Friend’s constituency—to drive economic development and reconciliation to help former combatants to integrate back into their communities, which are precisely the things that my right hon. Friend is looking for. We also supported the EU position over the removal of what is called the GSP-plus as a means to press the Sri Lankan Government to meet their human rights obligations.

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

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

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

I attended last week’s high-level forum on aid effectiveness in Busan. The United Kingdom was instrumental in securing an international agreement that, for the first time, includes new providers of development co-operation such as China and Brazil. I have also recently visited Burma for talks with the Government and with Aung San Suu Kyi. It appears that the political tectonic plates in Burma are shifting.

[Tom Greatrex]

The Secretary of State will I am sure be aware that 2013 is the bicentenary of the birth of David Livingstone, from Blantyre in my constituency. Will he undertake to work with the Scotland Office and other Departments of the UK Government to ensure that they contribute to the celebrations and commemoration of the work of David Livingstone in 2013?

[Mr Mitchell]

The hon. Gentleman raises the important issue of development in Malawi, which is challenged by the failure of the Government there to recognise the importance of taking the necessary steps to support very vulnerable people. The Scottish Government are doing a good job of supporting what is happening in Malawi. We are now working in an environment where Britain no longer gives the Government there direct budget support, but ensures that our support gets through by other mechanisms.

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

T6. Given the Department’s focus on giving aid to countries that are considered fragile, will my right hon. Friend update the House on the current estimates for fraud and corruption losses this year, and confirm that resources are being reallocated to tackle those, so that aid gets to those most in need?

[Mr Mitchell]

My hon. Friend makes the most important point: the Department for International Development has zero tolerance of corruption. The independent watchdog reported last week that although there was no evidence of corruption in this year’s programme, it was necessary to take new measures when we work in very difficult areas. I have instructed the civil service to implement all the independent watchdog’s recommendations, lock, stock and barrel. [Interruption.]

[Mr Speaker]

Order. The House really must come to order. The Secretary of State is having some difficulty being heard, and that should not be the case.

[Mr Ivan Lewis (Bury South) (Lab)]

Last week the Chancellor announced that, partially as a result of the Government’s failed economic plan, DFID will have over £1 billion less to spend than previously planned. The Secretary of State has rightly focused on transparency and predictability of funding. In that spirit, will he make it clear which budgets that £1 billion will be taken from? In that context, will he reassure the House that he continues to enjoy the support of his party in pressing ahead with legislation to enshrine the 0.7% target in law?

[Mr Mitchell]

Even for a Labour spokesman, the hon. Gentleman has a neck the length of a giraffe’s. Let me make it clear to him that the Chancellor of the Exchequer took action last week to ensure that we did not exceed the Government’s 0.7% promise. Personally, I am enormously proud to be a member of a Government who, in spite of the difficult economic circumstances that we face, have stuck by their commitments to the poorest of the world.

[Jesse Norman (Hereford and South Herefordshire) (Con)]

T7. My right hon. Friend will be aware of the excellent work done in Africa by Concern Universal, which is based in Hereford. Can he outline the measures taken to improve resilience against humanitarian disaster in Malawi?

[Mr Mitchell]

My hon. Friend again identifies the difficulties of operating in Malawi when Britain has stopped giving direct budget support. However, we are finding other mechanisms, particularly to address food security issues, and in the last 10 days we have approved additional funding for fertiliser to ensure that the next harvest has the best possible chance of succeeding.

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

T2. Although the famine in the horn of Africa is obviously the top priority there, future drought management is equally important. Will the Secretary of State tell us what aid his Department is giving to address this issue?

[Mr Mitchell]

The hon. Gentleman identifies the importance of having a wide set of measures to tackle famine and drought. We have given strong support to the Food and Agriculture Organisation to support livestock, and we are actively looking at ways to ensure that the crops do not fail next year. All the measures that we take are designed to boost resilience. It is an interesting fact that, as a result of the changes made in Ethiopia, the prevalence of malnutrition in that country has dropped by 50% in the last 10 years.

[Karl MᶜCartney (Lincoln) (Con)]

T9. In these times of austerity and hardship for so many of my constituents in Lincoln, how can my right hon. Friend justify his reported desire to legislate to force successive Governments to continue funding projects in 27 other countries, including India?

[Mr Mitchell]

My hon. Friend will be aware that the coalition Government looked at our bilateral programmes and reduced by 16 the number of countries in which we have country-to-country programmes precisely to ensure that we champion value for money. For example, on the first day we stopped aid to China and Russia. His constituents can be reassured that we are focusing on results and ensuring that every pound of taxpayers’ hard-earned money delivers 100p of results on the ground.

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

T3. Following the postponement of the election results in the Democratic Republic of the Congo, does the Secretary of State feel that the UK and the international community could have done more to ensure better oversight of those elections, and does he support the call for election results to be published polling district by polling district?

[Mr Mitchell]

We have had 89% of the votes counted. We are pressing the Electoral Commission to publish the results on a polling station by polling station basis so that any necessary appeals by those taking part can take place. Britain spent more than £30 million ensuring that registration and other things went ahead before the election. We must wait to see what the commission says about the credibility of these elections shortly. [Interruption.]

[Mr Speaker]

Order. Let us have a bit of order for the former Chairman of the International Development Select Committee, Mr Tony Baldry.

[Tony Baldry (Banbury) (Con)]

My right hon. Friend is the first UK Minister to have visited Burma for a very long time. Will he please take this opportunity to update the House on the outcome of that visit, particularly on his discussions with Aung San Suu Kyi?

[Mr Mitchell]

It does appear that the political tectonic plates are moving in Burma. The Government of Burma have made it clear that they are committed to releasing the political prisoners—in particular, Min Ko Naing, one of the leaders of the students of 1988—and also committed to the 48 by-elections proceeding. Aung San Suu Kyi and her party have said that they will stand in those elections. We await credible elections with fair and open results.

The Prime Minister was asked—

[Andrew Rosindell (Romford) (Con)]

Q1. If he will list his official engagements for Wednesday 7 December.

[The Prime Minister (Mr David Cameron)]

This morning I had meetings with ministerial colleagues and others, and in addition to my duties in this House, I shall have further such meetings later today.

[Andrew Rosindell]

The British people want to see two things from this week’s European summit: first, a resolute and uncompromising defence of Britain’s national interests; and, secondly, an end to the disastrous crisis of the euro—a currency that the Labour party still want us to join. Will the Prime Minister do Britain proud on Friday and show some bulldog spirit in Brussels?

[The Prime Minister]

I can guarantee to my hon. Friend that that is exactly what I will do. The British national interest means absolutely that we need to help resolve this crisis in the eurozone. It is freezing the British economy, just as it is freezing economies right across Europe. Resolving this crisis is about jobs, growth, business and investment right here in the UK. At the same time we must seek safeguards for Britain. That is the right thing to do. I can absolutely guarantee that as long as I am here there is absolutely no prospect of us joining the euro—something on which the Leader of the Opposition takes a different view.

[Edward Miliband (Doncaster North) (Lab)]

Six weeks ago the Prime Minister said that

“the idea of some limited treaty change in the future might give us”

the opportunity

“to repatriate powers back to Britain”.

At the European summit, what powers will he be arguing to repatriate?

[The Prime Minister]

As I explained, at the summit—[Interruption.] Let me explain—[Interruption.]

[Mr Speaker]

Order. We are all interested in hearing the answer. Let us hear it.

[The Prime Minister]

As I explained, we will have the key aim of helping to resolve the eurozone crisis, and we believe that means European eurozone countries coming together and doing more things together. If they choose to do that through a treaty at 27 in which we are involved, we will insist on some safeguards for Britain—and, yes, that means making sure we are stronger and better able to do things in the UK to protect our own national interests. Obviously, the more countries in the eurozone ask for, the more we will ask for in return, but we will judge that on the basis of what matters most to Britain.

[Edward Miliband]

The more the Prime Minister talked, the more confusing his position became, quite frankly. Let me remind him that on the eve of the biggest post-war rebellion against a Prime Minister on Europe, he was telling his Back Benchers that the opportunity of treaty change would mean in the future the repatriation of powers. That was his position six weeks ago. Today he writes a 1,000-word article in The Times, but there is not one mention of the phrase “repatriation of powers”. Why does the Prime Minister think it is in the national interest to tell his Back Benchers one thing to quell a rebellion on Europe, and to tell his European partners another thing?

[The Prime Minister]

I do not resile from a single word that I said in that debate. Let me tell the right hon. Gentleman what we want to do, specifically and particularly in the area of financial services, in which this country has a massive national interest. Let me remind him that it represents 10% of GDP, 3% of our trade surplus, and 7% of UK employment. I want to ensure that we have more power and control here in the UK to determine these matters, in complete contrast to the Labour Government, who gave away power after power. They gave up our power and they made us join the bail-out fund; we have had to get out of the bail-out fund. They gave up our rebate and received nothing in return; we managed to freeze the European budget. There is one party—one Government—that defends Britain’s interest, and another that always surrenders it.

[Edward Miliband]

I think the short answer is— [Interruption.]

[Mr Speaker]

Order. Let me say to the usual, predictable noisy tendency what I said to those on the other side a moment ago. People must be heard, and that is what will happen, however long it takes.

[Edward Miliband]

I think the short answer is that six weeks ago the Prime Minister was promising his Back Benchers a handbagging for Europe, but now he is reduced to hand wringing. That is the reality of this Prime Minister. The problem for Britain is that at the most important European summit for a generation, which matters hugely to families and businesses up and down the country, he is simply left on the sidelines. Is not the truth that we have a Prime Minister who is caught between his promises in opposition and the reality of government? That is why Britain is losing out in Europe.

[The Prime Minister]

I am afraid that even the best-scripted joke about handbags will not save the right hon. Gentleman’s leadership. He talks about being isolated. Let me explain to him where we would be if we adopted Labour’s policies. If we adopted your spending and your deficit policies, and if we were in the euro, I would not be going to Brussels to fight for Britain; I would be going to Brussels to get a bail-out. By implementing the proposals that it is advancing, Labour would put Britain in such a bad position that the tax changes would be written not by the shadow Chancellor, but by the German Chancellor.

[Mr Andrew Tyrie (Chichester) (Con)]

There is a wide spectrum of views on Europe throughout the House. [Interruption.] One can sense that even from the response to my remark. Will the Prime Minister take to the European Council the straightforward message that the one thing most likely to unite the House of Commons would be the perception of a calculated assault from Brussels—not even in its own interests—on the well-being of the UK financial services industry, and on the 1.3 million people in all our constituencies who work in it?

[The Prime Minister]

My hon. Friend is entirely right. Of course we want to see a greater rebalancing of our economy and more jobs in manufacturing, aerospace and technology; however, the economy that we inherited is very dependent on financial services. I think we should celebrate the fact that it is a world-class industry, not just for Britain but for Europe—but it is absolutely vital for us to safeguard it. We are currently seeing it under continued regulatory attack from Brussels. I think that there will be an opportunity, particularly if there is a treaty at 27, to ensure that there are some safeguards—not just for the industry, but to give us greater power and control in terms of regulation here in the House of Commons. I think that that is in the interests of the entire country, and it is something that I will be fighting for on Friday.

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

Q2. Does the Prime Minister agree that the recent escalation of industrial action in the public sector—which, incidentally, was not a “damp squib” in my part of the world—was a result of genuine anger about the sheer unfairness of Government action to deal with pension contributions, which is making people on low and middle incomes pay for the horrendous mistakes made at the top?

[The Prime Minister]

I am afraid that the hon. Lady is plain wrong, because the lowest-paid workers are not being asked to contribute more to their pensions. On fairness, let me make one point: under our offer, a primary school teacher earning £32,000 a year could receive a pension worth £20,000 a year, but private sector workers, who, let us remember, are the people putting their money into these pensions, would have to pay 38% of their salary—almost half—to get an equivalent pension. Of course there is an issue of fairness, and we must play fair by public sector workers, but we must also be fair to private sector workers, who are putting their money into these pensions.

[Steve Baker (Wycombe) (Con)]

Does my right hon. Friend agree that it is time for this country to lead Europe into the hope and potential of a new post-bureaucratic age?

[The Prime Minister]

I think that there are opportunities for Britain in Europe, and we should start from the premise that it is in Britain’s interest to be in the single market. We are a trading nation, so we need those markets open, and to be able to determine the rules of those markets. As Europe changes, of course there will be opportunities, but the first priority at the end of this week must be to ensure that the eurozone crisis, which is having such a bad effect on our economy, is resolved. At the same time, however, we should be very clear about the British national interest: safeguarding the single markets and the financial services, and looking out for the interests of UK plc.

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

Q3. Will the Prime Minister be having his usual Christmas bash with Rebekah Brooks and Jeremy Clarkson? If so, will they be talking about just how out of touch they all are with British public opinion?

[The Prime Minister]

I seem to remember that the annual sleepover was with the former Labour Prime Minister. I shall be having a quiet family Christmas.

[Mark Pritchard (The Wrekin) (Con)]

May I offer the Prime Minister my full support as he promises to stand up for the British national interest at the EU summit on Friday? Is it not the case, however, that Europe and the eurozone will be saved not by bail-out after bail-out of the eurozone but by making Europe more competitive, reducing its high unit costs and cutting regulation and red tape on business?

[The Prime Minister]

My hon. Friend is entirely right. I understand why leading members of the eurozone, such as the Germans, want tougher fiscal rules on budget deficits for eurozone members, but it is right to point out that the heart of the crisis was caused by current account deficits in some countries and large current account surpluses in others. Unless we solve the competitiveness problem at the heart of the euro crisis, the crisis will keep recurring. Our argument throughout has been that not only do we need tough rules on budget deficits and to see euro institutions, including the European Central Bank, acting in concert and acting strongly, but that we need to resolve the competitiveness problem at the heart of the single currency to deal with the crisis. I shall continue to make those points on Thursday and Friday.

[Edward Miliband]

Will the Prime Minister confirm that according to the Institute for Fiscal Studies, next year the poorest third of families will lose three times as much as the richest third, as a result of his economic policy?

[The Prime Minister]

No, the right hon. Gentleman’s figures are wrong. If we take all the things that the Government have done—that is the right way to measure this—we find that the top 10% will see losses nearly 10 times greater than the bottom 10% will. I believe that that is fair. One point that has not been properly understood, but which is important, is that the richest 10% in our country will experience the biggest reduction in income, not only in cash terms but proportionately. So we are being fair. It is incredibly difficult to deal with the debts and the deficit that he and his party left behind, but we are determined to do it fairly.

[Edward Miliband]

The Prime Minister is simply wrong again. The figures are there, and the poorest third are losing far more than the richest third. He used to say, “I’m not going to balance the budget on the backs of the poor.” [Hon. Members: “He’s not!”] No, that is right: he is not balancing the budget—there is £158 billion more of borrowing—but he is hitting the poor. To give him credit, though, there is one group for which he is easing the pain; this has not got the publicity that it deserves. He is delaying for one year the tax on private jets, at the same time as hitting the poorest families in this country. Will he confirm that a working mother earning £300 a week is seeing rising VAT, her tax credits cut, child benefit frozen and her maternity grant cut?

[The Prime Minister]

The right hon. Gentleman had 13 years in which to tax private jets—and now former Labour leaders are jetting around in them! In two years we will have taxed them. He quotes the Institute for Fiscal Studies. Let me remind him of what it said about Labour’s plans. It said that Labour’s policies would lead to

“even higher debt levels over this Parliament”—[Interruption.]

Labour Members do not like to hear their own policies being taken apart. [Interruption.] Calm down. [Interruption.]

[Mr Speaker]

Order. What I simply say to everybody is that I want to get down the Order Paper. If the Prime Minister wants to give a brief answer, let us hear it.

[The Prime Minister]

Let me just explain what the IFS said. It said that the right hon. Gentleman’s plans implied

“even higher debt levels over this Parliament than those we will in fact see.”

That is the truth of it. If we want the stimulus we are giving the economy through low interest rates, we have to stick to the plans we have set out. There is not a party in Europe, apart from the Moldovan communists, that backs his plans.

[Edward Miliband]

Now I have heard everything. The Prime Minister is talking about a stimulus, but he does not understand: he is cutting too far and too fast. That is why we have problems in our economy. Of course he does not want to tell us what the IFS says about his plans; he is the Prime Minister, after all. It says:

“New tax and benefit measures are, on average, a takeaway from lower-income families with children”.

The figures speak for themselves. His changes are hitting women twice as hard as men. Is not the truth that he is the first Prime Minister in modern times to say, “It’s the women and children first”?

[The Prime Minister]

The right hon. Gentleman’s soundbites get weaker and weaker as his leadership gets weaker and weaker; that is the truth of it. If we look at what we have done in lifting 1.1 million people out of tax, it is mostly women who benefit. If we look at the increase in the pension—£5.35 starting next April—that will benefit mostly women. If we consider the issue of public sector pensions, we are helping the lowest-paid in the public sector, and that will help women. Yes, we are giving the economy a stimulus by keeping our interest rates low. We have interest rates at 2%, while they are at 5% in Italy, 5% in Spain and 30% in Greece. If we followed his advice we would have interest rates rocketing, businesses going bust and more people out of work. That is what Labour offers, and that is why it will never be trusted on our economy again.

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

Small and medium-sized enterprises in my constituency are still having grave difficulty in accessing reasonable finance. A major contributory factor in that is lack of competition. Will the Government consider breaking up the nationalised banks to create more competition on the high street?

[The Prime Minister]

I do think we have opportunities to increase competition on the high street, and obviously, as we look to return the state banks to the private sector we will have further opportunities. We have already managed to take one important step forward by getting Northern Rock back out there lending to businesses and households, properly established in the north-east of England.

[Mr Speaker]

We now come to a closed question from Mr Jeremy Corbyn. He is not here. I call Mr John Baron.

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

Our history of repatriating powers from the European Union is not a happy one. May I therefore suggest a fundamental renegotiation of our relationship with the EU based on free trade, growth and competitiveness, which other countries enjoy, not on political union and dead-weight regulation? This EU summit is a defining moment—a once-in-a-lifetime opportunity. Will the Prime Minister seize the moment?

[The Prime Minister]

I am a little more optimistic than my hon. Friend. On the bail-out power that the last Government gave away, we are returning it to the United Kingdom via the European stability mechanism treaty, so we have returned a power. More recently, we have just won an exemption from all EU legislation to make sure that from January 2012 micro-enterprises will not face any new EU regulation at all.

In answer to the question of whether we will go in there and fight for British interests on Thursday and Friday—yes, absolutely we will. But let us be clear: there is the option of a treaty at 27, where we have the ability to say yes or no and as a result get a price for that, but there is also always the possibility that the eurozone members at 17 will go ahead and form a treaty of their own. Again, we have some leverage in that situation, because they need the use of EU institutions, but we should recognise exactly what our leverage is and make the most of it.

[Mr Pat McFadden (Wolverhampton South East) (Lab)]

Q5. Last year the Prime Minister’s manifesto promised to repatriate legal rights, criminal justice, and employment and social legislation. His article in The Times this morning is silent on all those issues, and the Justice Secretary has said that this agenda is not realistic anyway. Does the Prime Minister regret leading his party up the garden path and forcing himself into a choice between ditching his manifesto and potentially vetoing a treaty that may be essential to avoid huge damage to the UK economy?

[The Prime Minister]

What I regret is that the Labour party gave away so many powers. It is going to take a while to get some of them back, but we are making progress. When the right hon. Gentleman was in government there were repeated increases in the EU budget, whereas this year we have achieved an EU budget freeze. When he was in government he gave away the bail-out power and we had to pour billions of pounds into other countries. We have got that power back, and I believe that with strong negotiation, standing up for Britain, we can help to clear up the mess that Labour left us.

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

Over the past decade and a half there has been an explosion of personal debt levels in this country, yet we allow our young people to leave school without the proper skills to make informed decisions. Next week the all-party group on financial education for young people will report on where we feel this can fit into the curriculum. Will the Prime Minister read that report and meet a small group of MPs to discuss how we can ensure that young people are more financially literate in the future?

[The Prime Minister]

I shall be very happy to meet my hon. Friend, who knows a great deal about this, having been a supply teacher for many years in the constituency that he now represents.

[Andrew Percy]

I was a teacher.

[The Prime Minister]

He was a permanent teacher as well; excuse me. Financial education is important for our young people, and I look forward to seeing the report of his all-party group.

[Lilian Greenwood (Nottingham South) (Lab)]

Q6. The Prime Minister once said that he wanted to lead the most family-friendly Government ever, so is it not a disgrace that of nearly £19 billion of cuts that his Government have announced so far, more than £13 billion have fallen on women?

[The Prime Minister]

What I say to the hon. Lady is that it was this Government who introduced 15 hours of free nursery care for three and four-year-olds—something that the Labour party never managed to do in government —and despite the appalling mess that we were left, in this autumn statement we put in an extra £380 million to double the number of disadvantaged two-year-olds whose parents will get free nursery care. That is real progress and real help for families—something Labour never delivered.

[Ian Swales (Redcar) (LD)]

What would the Prime Minister say to a council such as Redcar and Cleveland borough council, which is considering rejecting Government funding for a council tax freeze next year, and instead charging my hard-pressed constituents 3.5% more?

[The Prime Minister]

I very much hope that all councils will take up the offer of a council tax freeze, because in this year of all years, when people face economic hardship, it is important that we help where we can. That is why we have cut the petrol tax. That is why we have allowed the council tax freeze to go ahead. So my advice to people in the hon. Gentleman’s constituency would be to support parties that back a council tax freeze.

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

Q7. Since the Education Act 1944, successive Governments have supported subsidised travel for students who live 3 miles or more from the faith school of their choice. Some local authorities are beginning to cut back on that financial support, and I do not think any Member in this House wants to see that happen. Can the Prime Minister encourage local authorities to embrace the spirit of the 1944 Act on this particular issue?

[The Prime Minister]

The hon. Gentleman asks a very important question. I support school choice—parents having the ability to choose between schools—and I also support faith schools. Indeed, I have chosen a faith school for my own children. So I will look very carefully at what he says and at what local authorities are doing, discuss it with the Education Secretary and see what we can do to enhance not only choice, but the faith-based education that many of our constituents choose.

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

Does the Prime Minister agree that in exchange for supporting the euro countries in dealing with their crisis, we should be seeking changes in the law of immigration, employment and fishing rights, in order to support our economy?

[The Prime Minister]

As I have said, if they choose a treaty at 27, that treaty requires our consent. We should therefore think of what are the things most in our national interests; I have talked about keeping the single market open and the importance of financial services. Clearly, the more that eurozone countries want to do in a treaty of 27, and the more changes they want to make, the greater ability we will have to ask for sensible things that make sense for Britain. I am very keen that we should exercise the leverage we have to do a good deal for Britain, and that is exactly what I will be doing in Brussels this Thursday and Friday.

[Mike Gapes (Ilford South) (Lab/Co-op)]

Q8. The Prime Minister promised:“I’ll cut the deficit, not the NHS”.Why are his Government closing the accident and emergency and maternity services at King George hospital, Ilford, cutting front-line NHS staff and borrowing £158 billion extra? Should he not have said, “I’ll cut the NHS, not the deficit”?

[The Prime Minister]

The hon. Gentleman is just wrong, because the deficit is coming down and NHS spending is going up throughout this Parliament. I note that his own party’s health spokesman says that it is “irresponsible” to increase spending on the NHS. We do not think it is irresponsible; we think it is the right thing to do. As the hon. Gentleman knows, the Health Secretary has set out the criteria for all local changes, including those in the hon. Gentleman’s constituency. There has to be proper public and patient engagement, sound clinical evidence, support from GP commissioners and proper support for patient choice.

[Andrea Leadsom (South Northamptonshire) (Con)]

The Prime Minister has taken a strong interest in the incredible work of the Oxford parent infant project in helping families that are struggling to form a strong attachment with their babies. Two months ago I started a new sister charity in Northamptonshire. Given the Prime Minister’s interest in strengthening families, will he commit to looking again at the incredible work that can be done in early intervention, which saves a fortune in the criminal and care services later on?

[The Prime Minister]

My hon. Friend is entirely right. I know about OXPIP and I am delighted that she is expanding the project into her own constituency. All the evidence shows that the more we can do to help children and their parents between the ages of nought and two—the key time at which so much disadvantage, which can have such a bad impact later on in life, can set in—the better. That is why her work, and that of Members across the House, in prioritising early intervention is so important for our country.

[Bill Esterson (Sefton Central) (Lab)]

Q9. The Prime Minister was asked by his constituent Phillip Hall, who runs his own construction company, to cut VAT on home repairs and improvements. Cutting VAT on home improvements has the support of more than 50 business organisations, including the Federation of Small Businesses. Will the Prime Minister support that cut in VAT, which would help jobs, growth and business?

[The Prime Minister]

The hon. Gentleman’s problem is that the Opposition have a huge list of extra spending and tax cuts that they want, but as we have heard again today in Question Time, they oppose every single spending reduction we are making and every single fundamental reform to get better value for money. One can only conclude that spending would go up, borrowing would rocket, interest rates would increase and the economy would be left in very dire straits.

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

Why is my right hon. Friend supporting a policy of fiscal unification for the eurozone states that, if it happens, will undoubtedly lead to the creation of a dangerously undemocratic single Government for those countries?

[The Prime Minister]

The point that I would make to my hon. Friend is that I do not want Britain to join the euro—I think Britain is better off outside the euro—but the countries that have chosen to join the euro have to make that system work. In order to do that, they need not just stronger fiscal rules, which is clear, but greater competitiveness. It is for them to decide how to go ahead and do those things. We should maintain Britain’s position outside the euro, and ensure that we safeguard our interests at the same time. That is exactly what I will be doing in Brussels.

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

Q10. Ten thousand service personnel will have heard of their real-terms cut in pay while serving on the front line in Afghanistan. What does the Prime Minister think that disgraceful cut will do for the morale of those who are risking their lives for us?

[The Prime Minister]

What we have done is double the operational allowance that people in Afghanistan receive. They are extremely brave people and we should be doing right by them; that is why we doubled that allowance. We have also increased the council tax disregard and made sure that the pupil premium is available not just to children on free school meals but to all service families’ children. We have put the military covenant into the law of our land and we will go on defending, promoting and protecting our brilliant armed services personnel and their families.

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

Q11. The Nun Wood wind farm application spans three local authorities, each of which independently assessed it against their local plans and rejected it. Subsequently a distant, unelected planning inspector overruled them and even moved his decision forward by three months so that it could be made the day before the Localism Bill got Royal Assent. The Prime Minister will understand my constituents’ anger. Will he look into what appears to be a blatant slap in the face for localism?

[The Prime Minister]

My hon. Friend makes an important point. As he knows, as a result of the changes we are making it will not be possible in future to overrule such decisions so as to meet a regional target, because we have now got rid of those regional targets. We are giving much more authority and many more decision-making powers to those local bodies. Our planning reforms will ensure that local people and their councils decide what people need, and how to meet that need.

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

Is the Prime Minister worried that the scandal of mis-selling in this country has just got a lot worse, given the previous broken guarantees to the public? He is now rejecting a vote on the latest European changes. He has mis-sold the issue to the public at large. Will he give a guarantee to the House that there will be an opportunity for the British people to deliver their verdict on the changes that are happening in Europe?

[The Prime Minister]

What this Government have given is something that no previous Government have done in this country. We have passed a law that means that if ever this Government, any future Government, or any future House of Commons, try to pass powers from Westminster to Brussels they will have to ask the British people in a referendum first. That means that there would have to have been a referendum on the Lisbon, Amsterdam and Nice treaties, and other treaties. People feel betrayed by what happened under the previous Government, but that cannot happen again.

[Fiona Bruce (Congleton) (Con)]

Q12. Small and medium-sized enterprises are the engine of the economy in my constituency and will play a very important part in our economic recovery. Will the Prime Minister acknowledge that a key factor in achieving growth, as well as in resolving the eurozone crisis, is to take action in Britain’s interests to tackle and reduce the huge regulatory burdens on small companies, so many of which come from Europe?

[The Prime Minister]

My hon. Friend makes an important point. We have to start here, in our own backyard as it were, and stop the gold-plating and over-regulation that has happened in the past. That is why we have the red tape challenge, with every rule being put up on the internet so that people can show how little we need to keep. That is why we have the one-in, one-out rule that applies to every Minister: no one can introduce a regulation without getting rid of a regulation. We have just achieved a major breakthrough in Europe: micro-businesses employing fewer than 10 people will not be subject to European regulation from 2012 onwards. That is a big breakthrough, and it is something that has not happened before in Europe. It shows that if we make the arguments for growth, jobs and enterprise, we can win them.

[Fiona O'Donnell (East Lothian) (Lab)]

Q13. The Prime Minister has today refused to accept that women and children will bear the brunt of his failed economic policy. No wonder he continues to turn women off. Will he accept the Treasury’s own figures showing that 100,000 more children will be living in poverty as a result of his policies?

[The Prime Minister]

How on earth does it advantage women and children to pile them up with debt after debt that they will then have to pay back? We have been standing here for 33 minutes and all we have heard from Opposition Members is proposals for tax reductions and spending increases, about reforms they would not go ahead with, and about scrapping the changes to public sector pensions. They would take those women and children whom we are concerned about, pile them high with debt and let them live under that burden for the rest of their days.

[Sir Peter Tapsell (Louth and Horncastle) (Con)]

May I hark back a month to 7 November, when, as is recorded at column 28 of that day’s Hansard, I put three suggestions to my right hon. Friend for containing the euro crisis, with which he appeared to agree? None of them, as he will have noticed, has been acted upon by the European Central Bank, so may I now express to him my belief that the alternative policy of a fiscal union will, as my hon. Friend the Member for New Forest East (Dr Lewis) has just said, pose a great threat to the liberty of Europe, because it would inevitably make Germany still more dominant? Can the Germans be persuaded to study the reason for the Boston tea party? “No taxation without representation” is the bastion of freedom.

[The Prime Minister]

As ever—[Interruption.]

[Mr Speaker]

Order. We have heard the question. We now want to hear the Prime Minister’s answer.

[The Prime Minister]

As ever, the Father of the House speaks with great knowledge, wisdom and foresight. The reason why he and I do not want to join the single currency is that we would not be prepared to put up with a supra-national power that would tell us what our debt, our deficit and everything else should be. That is why we do not want to join. If the countries of the eurozone want to make their system work, it is clear to me that fiscal rules are one thing that they may need, but that will not be enough without proper competitiveness, and—this is the third point that my right hon. Friend made—the full-hearted intervention and support of the institutions of the eurozone, including the European Central Bank. But it is a decision that those eurozone countries have to make themselves.

Point of Order

Wednesday 7th December 2011 Commons Chamber

12:36

[Mr Matthew Offord (Hendon) (Con)]

On a point of order, Mr Speaker. Members of the House are aware of their responsibilities in relation to the rules about not abusing their position in the House and about their personal and financial business interests. Therefore is it appropriate—

[Mr Speaker]

Order. The hon. Gentleman should resume his seat. I am grateful to him for what he has said so far, but an allegation of improper use of House resources, which I understand to be the kernel of his point, is not a matter for the Chair. I thank him for giving me notice of his proposed point of order, but I should tell him that any complaint about alleged misuse of such resources should be made to the Parliamentary Commissioner for Standards. Very simply, it is not a matter that should be raised on the Floor of the House. I hope that is helpful to the hon. Gentleman and to other right hon. and hon. Members.

If there are no more points of order, we come now to the ten-minute rule Bill. I call Mike Freer. May I appeal to right hon. and hon. Members who are leaving the Chamber to do so quickly and courteously, affording to the hon. Gentleman the same courtesy as they would wish to be extended to themselves in such circumstances?

Tax Refunds Regulation (Review)

Wednesday 7th December 2011 Commons Chamber

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

12:38

[Mike Freer (Finchley and Golders Green) (Con)]

I beg to move,

That leave be given to bring in a Bill to require the Chancellor of the Exchequer to commission a review of the timelines with which tax refunds owed to taxpayers by Her Majesty’s Revenue and Customs are made; as part of that review to consider the merits of making such refunds payable on the day they are calculated and applying interest and penalties to such refunds 30 days after they are payable; and for connected purposes.

I realise that I may be tempting fate, as I will be submitting my own tax return to HMRC within the next few weeks.

HMRC does pay interest, but the late payment rate is six times the unpaid refunds rate. Currently, with record lows in interest rates, the late payment rate is 3%, but the unpaid refunds rate is just 0.5%. When we look at penalties, the inequality is starker. Yes, there are a wide range of penalties applying to virtually every tax. For instance, if a taxpayer has not received a self-assessment notification, has not realised that they may need one and so does not ask for one, they may have to pay a penalty of up to 30% of additional tax due, even if they did not know the process they had to follow. A taxpayer, whether personal or business, who makes an inaccurate return through carelessness, not deliberate error, may also have to pay a penalty of up to 30% of the extra tax due. I am not aware of HMRC being penalised if it makes a mistake or its systems and processes contribute to late or unpaid refunds, yet that happens for the taxpayer.

The system is designed to push unpaid refunds into a suspense account. Errors can easily be made. For example, section 4 of the online form asks who will receive some or all of the overpayment. If a taxpayer does not provide bank details, rather than the Revenue simply issuing a cheque, the moneys are not issued and are held in a suspense account. The Revenue states that no repayment will be made automatically until the taxpayer contacts it. It could be argued that the taxpayer could and should provide accurate details and that the Revenue is right to withhold payment, but that would not prevent the Revenue from issuing a cheque. It simply chooses to withhold the money.

The key issue before us is the discrepancy between the penalties and interest rates levied by HMRC and the interest rates and lack of penalties levied on it. This is particularly relevant when the taxpayer has followed the rules but it has taken months for refunds to be paid. The Chartered Institute of Taxation has advised me that the catch-all reason for late payments is the security checks used to validate the identity of taxpayers, which appear to cause delays of up to several months. HMRC is right to combat fraud by undertaking such checks, but they are left to the very end of the refund process and are deliberately designed to delay the refund. Taxpayers and tax advisers often think that that is more to do with cash management by the Treasury than combating fraud.

Organisations assisting low-income groups have told me that delays in receiving expected refunds can cause disproportionate financial hardship for low-income taxpayers. Having coped with the delays in the onset of the process, when routine correspondence can take up to 12 weeks, the problem is then compounded in some cases by further delays of up to eight weeks for security checks to be made. For example, a pensioner I know of waited four months for a refund of just £70. That might not sound like a lot of money, but it is for a pensioner living on the basic state pension. The pensioner said, “We have always been prompt in settling our dues and expect the same in return.” The pensioner was living in the west midlands. The tax that was erroneously collected was paid to the Cardiff office, an apology for the mistake was received from the Portsmouth office and the cheque eventually arrived from the Glasgow office. No doubt the Revenue has reasons for handling different parts of the process in different parts of the UK, but a multi-part process handled in multiple offices cannot be conducive to efficiency.

How can we focus the Revenue on improving its customer service? In my experience of dealing with the public sector, if we grab them by the budgets, minds will follow. If the Revenue had to pay real rates of interest and penalties, it might be motivated to streamline its processes and issue refunds promptly. It fulfils an important role. The taxes it collects fund our essential services, and I have no issue with that. Being rigorous in collecting overdue tax is fair, but it seems oblivious to the scale and impact of tardy refunds.

My hon. Friend the Exchequer Secretary to the Treasury confirmed in a written answer to my hon. Friend the Member for Sevenoaks (Michael Fallon) that the Revenue does not hold information on the average length of time taken to process a repayment. It is simply not important enough to it. In my business experience, what gets measured gets done.

The Treasury Committee agrees. In its report in July, it commented on HMRC service standards, and one of its recommendations was that the HMRC work closely with professional bodies, charities and businesses to develop a series of performance indicators that credibly reflect customers’ end-to-end experience of dealing with the Revenue. Those indicators should be regularly published. If the interest paid on late payments and the penalties on those were published, I suspect that we would see a shift in the relationship between the HMRC and the taxpayer.

The issue of fairness is paramount in this Bill. Taxpayers should be entitled to the same level of interest and penalties on late refunds as the Revenue expects to levy on late payments. In this place, we often say that we govern only with the consent of the people. We have allowed the relationship between the Revenue and the taxpayer to deteriorate to that of master and slave. It is time to rebalance that relationship.

Question put and agreed to.

Ordered,

That Mike Freer, Mr Matthew Offord, Andrew Percy, Justin Tomlinson, Priti Patel, Andrew Bingham, Jesse Norman, Jane Ellison and Simon Hart present the Bill.

Mike Freer accordingly presented the Bill.

Bill read the First time; to be read a Second time on Friday 30 March 2012, and to be printed (Bill 259).

Appointment of the Chair of the National Audit Office

Wednesday 7th December 2011 Commons Chamber

Agreement of the Chair of the Committee of Public Accounts signified.

12:46

[The Prime Minister (Mr David Cameron)]

I beg to move,

That an humble Address be presented to Her Majesty, praying that Her Majesty will appoint Professor Sir Andrew Likierman to the Office of Chair of the National Audit Office.

This is the first time that a Prime Minister has moved a motion to appoint the chair of the National Audit Office, and it is a direct result of the legislation that we have brought forward to implement the Public Accounts Commission’s recommendations on strengthening the governance of the National Audit Office, including through new board arrangements and an independent chair.

At a time when we are getting to grips with a record budget deficit, and when families and businesses up and down the country are working hard to make ends meet, it is more important than ever that we get the best possible value for money in public service delivery. That is why, for example, this Government have delivered £3.7 billion of savings in just 10 months—enough to pay the salaries of 200,000 junior nurses or 150,000 secondary school teachers.

The National Audit Office has a vital role to play in holding the Government to account and in ensuring that we achieve the greatest possible value for money. The proposed chair is Professor Sir Andrew Likierman, currently the NAO’s acting chairman. He was appointed following an open competition by my predecessor the right hon. Member for Kirkcaldy and Cowdenbeath (Mr Brown) and the former Chair of the Committee of Public Accounts, my hon. Friend the Member for Gainsborough (Mr Leigh). The intention was that Professor Likierman should become the chair of the new NAO in due course, and he has indicated his willingness to continue in the role for a further three years.

Professor Likierman is a distinguished public servant with extensive knowledge and experience of business and public service. Since taking up the acting chair role, he has established the NAO’s board as an effective governance body, providing support and independent challenge to the NAO’s decision-making process. He has also provided counsel and advice to the Comptroller and Auditor General at a time of change for both the NAO and the central Government bodies that it audits.

I believe it is desirable for Professor Likierman to be appointed under the new legislation in order to provide continuity as the NAO formally adopts its new governance arrangements, and I have no hesitation in commending this motion to the House.

12:49

[Margaret Hodge (Barking) (Lab)]

I am pleased briefly to take part in the debate and to confirm the appointment of Andrew Likierman as chair of the National Audit Office.

In my role as Chair of the Committee of Public Accounts, may I take this opportunity to endorse what the Prime Minister has said about the suitability of Sir Andrew? Although it was my predecessor, the hon. Member for Gainsborough (Mr Leigh), who was involved in the appointment of Sir Andrew as acting chairman of the NAO, it is clear that in any field of open competition Sir Andrew’s qualifications are outstanding. He brings with him a wide breadth and depth of experience in financial reporting, Government finance and issues of governance. His distinguished career has encompassed both the public and private sectors in an academic and a professional capacity. He is a past managing director of the Treasury and head of the Government Accountancy Service. He has advised the Treasury Committee and is currently dean of the London Business School. His suitability for this role is unquestionable.

As the Prime Minister said, Sir Andrew has already played an important role at the NAO. He has been instrumental in establishing the new governance arrangements and providing the leadership to form an effective board during a time of organisational change. He has already contributed to enhancing the credibility, reputation and influence of the National Audit Office in supporting both Government and Parliament to secure better value for money, particularly in the current fiscal environment. I have no doubt that Sir Andrew has had a great and positive impact since he was first appointed in 2009 and that he will continue to do so in future. I wish him well.

12:51

[Mr Edward Leigh (Gainsborough) (Con)]

I support the motion moved by the Prime Minister. I remember that his predecessor was a bit cross about having to come to this rather quiet little affair, with all his other very heavy responsibilities, especially as he had already appointed the previous Comptroller and Auditor General as an acting Comptroller and Auditor General.

It is worth emphasising that the reason it is important that the Prime Minister is here is that this is the one job—in fact, there are two jobs, the Comptroller and Auditor General and the chair of the National Audit Office—that is not in the sole gift of the Prime Minister. At least there is one job he does not appoint; I am sure that he is prepared to concede this one. It is very important that he is not in sole control and that he appoints the heads of both these bodies—the chairman of the NAO and the CAG—with the Chairman of the Public Accounts Committee. By definition, my right hon. Friend is a member of the Government—that is obvious—and, by changing the rules of this House to create a unique rule, we have ensured that the Chairman of the Public Accounts Committee is always a member of the Opposition. The two people who run the National Audit Office are therefore appointed on a genuinely all-party basis. That is essential.

Of course, I welcome this sealing of the appointment of Sir Andrew. I could hardly say anything else, as I appointed him in the first place. He is a superbly well qualified person for this job. The reason we created the new role of chairman of the board—I worked with Alan Williams, the former Father of the House, to whom, once again, I pay tribute for his many long years of service to this House—was that previously the Comptroller and Auditor General was, in effect, a dictator. He had sole control of the organisation; there was no board, and none of his judgments should be questioned. It is quite right that when the CAG looks at the accounts of Government— when he is holding the Government to account—he should be completely independent and act on his own, and nobody must be able to gainsay him. He must be able to look into every filing cabinet, summon every civil servant, and expose every scandal. However, in terms of running a modern organisation like the National Audit Office, it was right that we should modernise, move with the times, and create a proper board that could oversee the organisation as opposed to the policy, and that is what we did with the appointment of Sir Andrew. He is a good candidate and I welcome his appointment.

12:53

[Mr Richard Bacon (South Norfolk) (Con)]

I, too, rise to support the motion. Sir Andrew Likierman is a highly suitable candidate.

I must say that at first, I had doubts—not about Sir Andrew, but about the office of chairman of the National Audit Office and the suitability of having a board. I was concerned about maintaining the independence of the Comptroller and Auditor General and making sure that his independence was no way impinged on by any further statutory inhibitions of any kind. I am now satisfied, especially as Sir Andrew has served as the shadow chairman for the past 18 months to two years, that that will not happen and, moreover, that the arrangements between the National Audit Office and its chairman, and in relation to the statutory functions of the Comptroller and Auditor General, which must not be impeded, have been satisfactorily worked out.

Those functions include access, if required, to every filing cabinet. May I say to the Prime Minister that that includes, if required, access to Cabinet papers? That is not—because the Comptroller and Auditor General, as we all know, is statutorily prohibited from looking at policy questions—in order to question policy, but to see that the right judgments were arrived at in obtaining value for money. In the light of the recent discussions that have been held on this subject in relation to the Ministry of Defence, I am pleased that the system worked as it should and that, as in the past, the National Audit Office ultimately had access to Cabinet papers. This was not exceptional—the NAO has done it before—and the system worked as it should. That shows that the judgments that the National Audit Office reached, having had access to Cabinet papers, were the right ones. Because of that, and because of Andrew Likierman’s suitability, I am very happy to support the motion.

12:55

[The Economic Secretary to the Treasury (Miss Chloe Smith)]

It is an honour to support the Prime Minister and the right hon. Member for Barking (Margaret Hodge) on the motion to appoint Professor Sir Andrew Likierman as chair of the new National Audit Office. I should like to echo the tributes of other Members, including my hon. Friends the Members for Gainsborough (Mr Leigh) and for South Norfolk (Mr Bacon), regarding the fine contribution that Professor Likierman has already made as shadow chairman of the National Audit Office and his qualifications for the role.

Since becoming shadow chairman, Sir Andrew has done tremendous work to establish the shadow board as an effective and authoritative governance body. This has set the basis for the future as the NAO takes on its full responsibilities. As the House is aware, the new governance arrangements for the NAO were enacted following a report by the Public Accounts Commission in the previous Parliament. That report recommended that the NAO, led by the Comptroller and Auditor General, should remain the Government’s auditor, independent of Government and answerable directly to Parliament through the commission. The commission also recommended that the NAO should be a corporate body, with existence separate from, but providing resources and support to, the Comptroller and Auditor General.

The new NAO will have a board with a majority of non-executives, including an independent non-executive chair, who will be a Crown appointment, appointed by the Crown in the same way as the Comptroller and Auditor General. The Comptroller and Auditor General will have a fixed 10-year term—previously it was unlimited—and remuneration of the CAG will be agreed by the Prime Minister and the Chair of the Committee of Public Accounts, rather than being linked to permanent secretaries’ remuneration. The report also recommended that the NAO’s audit reports continue to be laid in Parliament, and that the Committee of Public Accounts should continue to hold scrutiny hearings on some of them.

The report’s recommendations were accepted by the previous Government, and provision was included in the Constitutional Reform and Governance Bill, which received cross-party support in the Commons. As the House will be aware, those clauses were lost in the other place during the wash-up stage before the general election, but this year the Government included the provisions in the Budget Responsibility and National Audit Act 2011. The governance reforms envisaged in the provisions strengthen the independence and accountability of the Comptroller and Auditor General in holding the Government to account.

These reforms are entirely in line with the coalition Government’s commitment to transparency and accountability in the public finances, including by implementing whole of Government accounts. As the right hon. Member for Barking noted, effective independent oversight of the efficiency of Government spending is especially important when public resources are under pressure, and these reforms are intended to ensure that the Comptroller and Auditor General and the NAO can fulfil that role.

I support the motion and Sir Andrew Likierman’s appointment as the first independent chairman of the new National Audit Office.

Question put and agreed to.

Independent Parliamentary Standards Authority

Wednesday 7th December 2011 Commons Chamber

12:58

[The Leader of the House of Commons (Sir George Young)]

I beg to move,

That Ms Angela Eagle be appointed to the Speaker’s Committee for the Independent Parliamentary Standards Authority in place of Hilary Benn, until the end of the present Parliament, in pursuance of Schedule 3 to the Parliamentary Standards Act 2009, as amended.

The Speaker’s Committee for IPSA is a statutory Committee set up under the Parliamentary Standards Act 2009, and its role and membership is determined by that statute. It has two key responsibilities: to consider the candidates proposed by the Speaker following fair and open competition for the posts of chair and members of IPSA, and to approve IPSA’s annual estimate of resources. The Speaker’s Committee’s current membership includes you, Mr Speaker, the Chair of the Standards and Privileges Committee, and me, by virtue of our offices. Its membership also includes five Members of Parliament appointed by the House and three lay members appointed by the House in January 2011.

The motion was tabled at the request of the Opposition. It will remove the right hon. Member for Leeds Central (Hilary Benn) from the Committee and add the shadow Leader of the House in his place. This is a matter for the Labour party and the Government are happy to facilitate it. As a member of SCIPSA, I would like to thank the right hon. Gentleman for his work on the Committee, including in some lively meetings under your chairmanship, Mr Speaker. I look forward to welcoming the hon. Member for Wallasey (Ms Eagle), should the House agree to the motion, to the Committee. I know that she will add great value to our proceedings.

I commend the motion to the House.

Question put and agreed to.

Common European Sales Law

Wednesday 7th December 2011 Commons Chamber

13:00

[The Parliamentary Under-Secretary of State for Justice (Mr Crispin Blunt)]

I beg to move,

That this House considers that the Draft Regulation of the European Parliament and of the Council to introduce a Common European Sales Law (European Union Document No. 15429/11 and Addenda 1 and 2) does not comply with the principle of subsidiarity, for the reasons set out in Chapter 5 of the Forty-Seventh Report of the European Scrutiny Committee (HC 428-xlii); and, in accordance with Article 6 of Protocol (No. 2) of the Treaty on the Functioning of the European Union on the application of principles of subsidiarity and proportionality, instructs the Clerk of the House to forward this reasoned opinion to the Presidents of the European Institutions.

I will start by making some general contextual comments. I am pleased that this debate has been called because the proposed common European sales law is important both politically and legally. I know that it is of interest to Parliament and the public.

This debate makes use of article 6 of protocol 2 to the Lisbon treaty, the subsidiarity protocol, which enables national Parliaments to put forward a reasoned opinion challenging a proposal by the European Commission on the grounds that they do not consider that it complies with the principle of subsidiarity. I believe that this is the fourth time that this House has considered such a motion. The first three related to financial services and this is the first in the area of justice. I note with interest that a debate on the same proposal was held in the German Bundestag last week, where it was accepted unanimously that the proposal for the common European sales law was contrary to the principle of subsidiarity. I am sure that fellow member states and their Parliaments will listen with interest to what is discussed and concluded here today.

I should make it clear at the outset that the drafting of a reasoned opinion is a matter for Parliament, not for the Government. The European Union treaties have given the role of the supervision of subsidiarity to national Parliaments. It is therefore Parliament’s task to decide whether to present such an opinion to the European Union institutions. I should also say that the Government are considering a report by the Procedure Committee relating to the handling of reasoned opinions such as this. I hope that the House will understand if I do not speculate on what the outcome of those considerations will be.

Subsidiarity is a word that we hear much about when dealing with European legislative proposals. It may assist the House if I say a few words about it. The concept is defined in article 5 of the treaty on European Union:

“in areas which do not fall within its exclusive competence, the Union shall act only if and in so far as the objectives of the proposed action cannot be sufficiently achieved by the Member States, either at central level or at regional and local level, but can rather, by reason of the scale or effects of the proposed action, be better achieved at Union level.”

It follows that subsidiarity is a specific legal and political concept. In simple terms, it means that decisions should be taken as closely as possible to the citizens whom they affect, and that the European Union should act only when outcomes can be better achieved at European Union level. Subsidiarity is different from the principle of proportionality, under which any action taken by the European Union should not exceed what is necessary to achieve the stated objectives.

Successive Governments have supported the principle of subsidiarity. I am told that the United Kingdom pushed for it to be strengthened in the Lisbon treaty. The treaty includes a requirement that all legislative proposals should include a statement making it possible to appraise their compliance with the principles of subsidiarity and proportionality. It also introduced the power for national Parliaments to transmit reasoned opinions relating to subsidiarity, such as that which we are debating today. The European institutions—the Commission, the Council and the European Parliament—are obliged to take account of all such opinions.

Moreover, if one third of the national parliamentary chambers throughout the European Union submit such opinions, the Commission must review its proposal. I do not think that any proposal has yet been objected to by a third of the national parliamentary chambers. If that did happen, it would represent a powerful political signal, which the Commission would do well to heed. It cannot be denied that one third is a high threshold. To achieve it will require a great deal of co-ordination between national Parliaments. As I have said, this is a matter for Parliament and not for the Government. I can only encourage the European Scrutiny Committee and other interested parties in Parliament, both in this House and the other place, to make the best use of their contacts with other national Parliaments in this regard.

[Stephen Phillips (Sleaford and North Hykeham) (Con)]

Will the Minister give way?

[Mr Blunt]

I would like to give my hon. and learned Friend the chance to make his substantive comments in the course of the debate and I will then reply. However, if it is a question on the point that I was making, I will of course give way.

[Stephen Phillips]

I am extremely grateful to the Minister for giving way. Will he indicate for the House how many Parliaments, apart from the Westminster Parliament, have asked for a reasoned opinion to date?

[Mr Blunt]

My hon. and learned Friend was unhappily absent at the beginning of my remarks, when I reported to the House that the Bundestag gave a unanimous opinion last week that this proposal was contrary to the principle of subsidiarity. I am not aware of any other parliamentary chambers that have undertaken to do so. To illustrate the difficulty of achieving the level of one third of chambers taking a view and reporting a reasoned opinion, the Bundesrat has not taken a view. Therefore, of the two German Chambers, only one, the Bundestag, has taken a view. Only half of the German Chambers have taken a view, whereas the hurdle that has to be achieved is a third of national parliamentary chambers. My hon. and learned Friend will understand that it is quite a hurdle in those circumstances. Of course, it is a matter for the other place whether it takes a view on this matter.

You will be aware, Mr Speaker, from reading the Government’s explanatory memorandum on this proposal that, provided that it is demonstrated that the difference in national contract laws is a genuine obstacle to cross-border trade, the Government’s view is that the subsidiarity test is likely to be met. The Government do, however, share the European Scrutiny Committee’s concerns about the necessity for this proposal in the first place. We question whether an optional common European sales law or one with such a wide scope is the right way to address this issue. These matters will form part of the consultation that the Government plan to hold. I shall therefore listen to Members’ views with great interest.

I will now turn to the substance of the proposed regulation. This proposal has a long history. The European Commission and the European Council have been engaged in the general issue of contract law for a decade or so. I believe that the European Parliament’s involvement stretches back even further. The European Union contract law project lay dormant for some time, but gained momentum again in July 2010 with the publication of a Commission green paper on options for progress towards an EU contract law for business and consumers.

The green paper set out various options for reform, including to continue with the development of a legislators’ toolbox. That would provide a common frame of reference, drawing together the most common concepts and terms used in contract law, which would be the commonly agreed basis to be used by the authors of future European Union laws relating to contract law. The aim of that would be to reduce or remove the current differences and the difficulties that they cause. The green paper invited views on seven options, from a specific directive or a regulation providing an optional European Union-level regime, right through to a mandatory black letter European code of contract law. The conclusion of the Commission green paper’s analysis, and of views received on a feasibility study published by the expert group in May, have culminated in the proposed regulation for a common European sales law.

More recently, the Commission’s proposal was published on 11 October. It contains a set of uniform contract law rules that parties to a contract could choose to govern their contract. The use of such rules would be optional, but that optional law would form part of the national law of each member state and could be used as an alternative to what is currently offered under national law. That alternative regime would be available for cross-border business-to-consumer and business-to-business contracts when at least one party was a small or medium-sized enterprise.

Although the Government intend to consult widely on the detailed policy implications of the proposed regulation, our initial assessment indicates that it would be neither simple nor easy to use. Although it is designed to be free-standing, it remains unclear what relationship it would have with other Union laws such as the Rome I regulation. It also seems that a range of matters that could affect the legal relationship between the parties have not been addressed in the proposed regulation. That has the potential to undermine the aim of removing the need for businesses to incur transaction costs on legal advice on another country’s law.

The scope of the proposal could prove difficult, with its wide application to business-to-business and business-to-consumer contracts whether they are concluded at a distance, away from business premises or on the premises. The Government are not sure whether such an all- encompassing regulation is the correct way to address the different problems that traders and consumers may experience. In addition, current arrangements already provide that any state’s law can be chosen as the law of contract. In that sense, a trader could already choose which law to apply to his or her contract, and in most cases that is likely to be their own. The anticipated net value of the regulation remains to be tested and quantified against the costs of introducing a new law.

The Government are also concerned about the treaty base used in bringing the regulation forward. The proposed legal basis is article 114 of the treaty on the functioning of the European Union. That basis is normally used for harmonising laws in order to further the establishment of the internal market. The Government have doubts about the appropriateness of that, particularly as most other optional instruments that operate in parallel to domestic law are brought forward on other legal bases.

The Government have been working closely with interested parties through the process leading to the proposed regulation. Indications so far are that opinion is divided. Some interested parties see an optional contract law for cross-border sales as a potentially useful tool for aiding the internal market, but others see such a new law as risky, over-complex and unnecessary.

The Government intend shortly to consult United Kingdom interests on the proposed regulation. The views received will be used to develop and inform the Government’s position on the likely impacts of such a regulation, as well as on any benefits or disadvantages that are likely to occur for the various sectors that it could affect. We will not form a concluded view on our approach to the proposal until after the consultation has been concluded and there has been proper time to analyse the results. For today, I am of course grateful for the chance offered by the debate to hear the specific concerns that Members may have.

13:13

[Mr William Cash (Stone) (Con)]

I am grateful to the Minister for his comments. As he knows, the European Scrutiny Committee’s conclusion is that the proposal does not respect the principle of subsidiarity. I heard what he said about the difference between the two chambers in Germany. We know that the Bundestag takes the same view as us, and the fact that the Bundesrat does not fails to alter the fact that there is a powerful reason for us to pursue the points that led to the reasoned opinion that we are submitting.

Many organisations have been consulted or have offered evidence on the matter, and their evidence is very powerful from a practical point of view. I have in mind the evidence of Which?, Consumer Focus, the Federation of Small Businesses and the Law Society. It would be invidious to go through each of the objections and arguments that they have made, but in general there are questions about whether there is clear evidence that the regulation is needed and about legal uncertainty, cost and potential confusion.

There is no doubt that throughout the whole business community, there is grave concern about the range and extent of such a provision. In a nutshell, the question whether there is compliance with the principle of subsidiarity is essentially one of practicality as much as of constitutional propriety. The whole object of subsidiarity is to determine whether a matter is better handled at national level than under the aegis of the European legal framework. It remains to be seen whether other national Parliaments enable us to reach the threshold necessary for the matter to be returned to the Commission, but all the evidence that we have received demonstrates that the UK should adopt the reasoned opinion and send it to the presidents of the Commission, the Council of the European Union and the European Parliament before 12 December.

All the arguments are set out in the papers that are in the Vote Office. As I said, I do not think it is necessary or desirable to take the House through every jot and tittle of them—they are so powerful that I really do not think there is any need for me to do so. I would, however, say that it is axiomatic that an optional sales law common to all member states is something that can be better achieved at EU level than at national level. However, that is to assume that the proposed common sales law is necessary and will produce clearer benefits by reason of its scale and effect than action by member states. Based on the evidence to which I have referred, the European Scrutiny Committee doubts whether either requirement has been met.

In addition, the Committee finds that the Commission has again failed to prepare a detailed assessment, in accordance with article 5 of protocol 2 to the Lisbon treaty. That is a very important point. It makes it exceedingly difficult for national Parliaments to determine whether there has been compliance with the principles of subsidiarity within the eight-week period. We were greatly assisted in this case by the submissions that we received from the organisations in the UK to which I have referred. Where their concerns overlapped, we found that there was a convergence of views. That was particularly instructive and helpful to the Committee, and we are grateful for that. In fact, I would go further and say that I wish more business organisations would make submissions more frequently on many such matters that come before my Committee. It is one thing for us to form a judgment, but it is also extremely important to know that it is based on firm practical considerations.

The Commission’s failure to provide a detailed statement amounts, in our view, to an infringement of the essential procedural requirements laid down in protocol 2. We therefore recommend that the House adopt a reasoned opinion to be sent to the Presidents of the Commission, the Council and the European Parliament before the deadline of 12 December. We retain the draft regulation under scrutiny pending a further update on the negotiations, and we are particularly interested to hear the outcome of the discussions on the appropriate legal base. As far as we are concerned, the communication itself can be cleared from scrutiny.

I therefore submit that the draft reasoned opinion of the House should be adhered to and submitted accordingly, and that we should do all in our power to get as much support as possible from other member states, because of the serious breaches of the procedural arrangements and because of the breach of the subsidiarity principle. I look to the Government to do that.

13:20

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

I rise briefly to highlight some concerns with the proposals. The perspective of Which? and Consumer Focus is that the different contract laws do not stop consumers or businesses from cross-border trading to any significant degree. It is not clear that the proposal would lead to an expansion of such trade, and it could lead to greater complexity and therefore increase business transaction costs.

There is no legal certainty that the measure would be applied uniformly across the EU. It therefore has the potential to create legal uncertainty and confusion for customers, and it would not provide them with choice, because they would continue to be limited to accepting the contract offered to them by the supplier.

There are grave reservations in relation to the potential for the measure to lead to back-door harmonisation of contract law. I am sure that if my right hon. Friend the Member for Bermondsey and Old Southwark (Simon Hughes) had been in a position to stay for the whole debate, he too would have made those points.

I understand the Government’s perspective of subsidiarity, but the measure is an optional change, not an imposed one. Can subsidiarity in all cases overrule something that is optional and not mandated? The Minister rightly said that the regulation would not be simple to use and that complexity is involved, but have the Government assessed whether the proposal is more complex than the current legislation? Do they recognise that the Federation of Small Businesses says that small businesses need to be able to afford to compete in different markets in the EU?

The proposal raises many more questions than it resolves, and therefore a detailed and extensive consultation is required.

[Mr Cash]

I rise simply to say that the City of London corporation has also provided a method of objection and to add it to the other representative organisations I mentioned.

[Mr Speaker]

Order. There is some confusion here. I think the hon. Gentleman either thought or hoped he was intervening on the right hon. Member for Carshalton and Wallington (Tom Brake), but the latter is signalling that he has concluded his remarks. I am sure that that fact will be of close and abiding interest to the hon. Member for Stone (Mr Cash), knowing what a great interest he takes in the observations of other hon. Members.

13:23

[Stephen Phillips (Sleaford and North Hykeham) (Con)]

I rise to make a short contribution to the debate, and to make some of the points that were made to my hon. Friend the Member for Stone (Mr Cash) and others on the European Scrutiny Committee by the City remembrancer of the City of London, who has provided us with a briefing that contains a number of salient observations on the measure, which are important for the House to consider in deciding whether the motion should carry.

The first and most worrying of those observations—I attribute these views not at all to the City of London or the City remembrancer; these are my words—is that there is considerable concern that the measure is the thin end of a uniform contract wedge that is being deployed by the Commission in an attempt to undermine the universality of English contract law, which is used in transactions not only between businesses within the EU but across the world, where, alongside New York law, it is the predominant way in which international trade is regulated. I should like to hear more from the Minister on that.

Were there any doubt that the Commission has in mind that the proposed regulation is the thin end of a uniform contractual wedge, it would be removed by article 15, which makes clear that the Commission would be obliged to review the measure after five years,

“taking account of…the need to extend the scope in relation to business-to-business contracts, market and technological developments in respect of digital content and future developments of the Union acquis.”

Given that the Justice Commissioner has already indicated that he plans to announce consideration of a European common insurance law next year, there ought to be grave concern on both sides of the House that the measure is the first step in an attempt to impose upon this country a uniform European contract law. I suspect that many hon. Members would be extremely concerned about that.

The second concern to which it is worth drawing the House’s attention is the speed with which the draft regulation was drawn up. It was drawn up in a very short period of some 11 months by a so-called expert group which, I must tell the House, consisted predominantly of academics. It consisted for the most part not of those who actually practise law or indeed of those who would have the option to use this contract law were it to be introduced. In those circumstances, if the proposals were to go ahead, there would, in my respectful view, need to be a much greater consideration of what practitioners have to say on the subject of contract law and the draft regulation, and a much greater consideration of what business wants.

Those are two initial concerns about the regulation, but there are others. Essentially, the regulation would establish an optional contract law that would lie alongside national contract law, but that could cause conflict between almost identical contractual situations as they apply between those who are negotiating within the EU, and possibly even between those within member states. The position would essentially be that someone who selects the option of the EU contract law might gain greater rights than someone who does not do so—the latter, through the application of conflict of laws rules, would have the contract containing his rights and obligations subjected to some wholly different system of law. That must be a grave concern, because it could result—naturally—in different decisions being taken by national courts in relation to precisely the same facts, depending on which law applies. That might be acceptable when the laws that apply are of different nations, which would be selected pursuant to established conflict of laws rules, but it cannot, in my judgment, be acceptable when the laws in question are on the one hand common law, as in this country, and on the other hand an optional community contract law, both of which none the less hold sway in the same jurisdiction. That is therefore a very great reason why the measure is not in the interests of the City of London, or of this or any other European country.

Establishing a new contract law—even one that has been written by a group of academics—is, moreover, destined to lead to much greater litigation, uncertainty, increased costs, and increased transactional costs, because there will be no established body of law and no binding juridical opinion by reference to which those who are obliged to be consulted on difficult legal problems arising out of contracts can form settled views as to the correct answer in respect of their clients’ rights, entitlements and obligations.

Growing that body of law—it could grow only in this country, where we have a system of precedents—could take several decades. If small and medium-sized enterprises, and perhaps even larger businesses, adopted the optional contract law, their rights and obligations would necessarily be unclear during that time. That is not only most unsatisfactory from the perspective of those who seek to do business in international markets, but wholly unsatisfactory from the perspective of the development of the law.

[Mr Cash]

On the question of legal base, does my hon. and learned Friend recall that originally the Secretary of State for Justice took the view that he had doubts over whether article 114 was appropriate? There was then the question of whether article 352 might not be more appropriate. Unfortunately, because of the enactment of the European Union Act 2011, primary legislation had to be passed before the Government could give their consent to the adoption of the proposal on article 352. Therefore, there is a serious question over whether there has been complete compliance not only with the principle of subsidiarity but with the legal base.

[Mr Speaker]

The principle of subsidiarity is important, but there is also a very important principle of interventions, and that is brevity.

[Stephen Phillips]

I am extremely grateful to my hon. Friend for his intervention, brief or not. I will not fall into his elephant trap of discussing what precisely is necessary under the European Union Act 2011, but I will say that I agree with him. It is right that there is no justifiable legal base under article 114, not least because the European Court of Justice has itself made it clear that that article cannot be used for the harmonisation of laws within the European Union.

I was on the point of saying that there is a real problem with running in parallel two systems of contract law, particularly where that might lead to different results and where one has not been the subject of extensive judicial consideration. In such a case, it is inevitable that there would be differences of opinion among those who are called on to provide advice on the rights, obligations and entitlements of parties to contracts, and they are the ones who are subject to this new system of optional contract law were it to be in place. For those reasons, it must be entirely right that we should not seek to accommodate the Commission’s proposals to have in place two parallel systems of contract law in this country. That would be detrimental to the interests of the United Kingdom and consumers and businesses all over the European Union. For those reasons, I urge the Minister to make those points as strongly as he can to his colleagues in Europe, and I make those points, albeit through you, Mr Deputy Speaker, to the other national Parliaments who really need to require the Commission to justify its proposals.

13:29

[Robert Flello (Stoke-on-Trent South) (Lab)]

This is not a new matter. In European Committee B, which met on 24 May, the Under-Secretary of State for Justice, the hon. Member for Huntingdon (Mr Djanogly) noted that European contract law had been more than 10 years in its formation. Indeed the Minister has referred to that again today. Despite the length of that period, the actual draft law has been put together in some haste.

In the Committee, I raised a number of concerns and expressed the view that the Commission had not come up with any reliable evidence for its proposals; that many other barriers to trade need to be addressed as more of a priority than this issue; and that adopting another set of contract rules was unnecessary and possibly harmful.

The Committee was supportive of the toolbox approach, but not more. According to the Hansard report of that Committee, I said that I was concerned that the exercise on the Commission’s part, namely the green paper and the whole thrust of things, seemed to be a way of trying to push through option 4 instead of doing what it should be doing, which was putting together the toolbox. I therefore urged the Under-Secretary of State to go back to the Commission and make representations in the strongest terms to get things back on track and promote the toolbox and not the draft contract law. What has changed since May? Sadly, I think nothing positive has changed and so the Opposition agree that a reasoned opinion should be sent to the presidents of the European institutions, in effect, to reject the draft regulation.

The draft European sales law has caused a great deal of concern for many individuals and organisations and little support appears forthcoming from any quarter. Let me be gently mischievous here and suggest that other than the Lord Chancellor—whose generally Europhile stance accords with that of his party—I am not aware of any quarter where this particular proposal has received any positive comments at all.

The aim of the proposed regulation seems laudable enough. It is to reduce what the EU perceives as barriers to cross-border trade and thereby improve the ability of traders to exploit the common market and help consumers gain access to products across member states. That is all very laudable in theory, but let me explore that aim.

The evidence base from the European Union seems flimsy to say the least. Evidence from UK representative organisations shows just how weak the EU research appears to be. The survey of the Federation of Small Businesses demonstrated that just 18% of its members thought that a European Union sales law would make their life easier, but that seems to me to be a very low figure given the aims of the regulation.

The consumer organisation Which? opposes the regulation, saying that the proposed law would not contain a satisfactory level of consumer protection, that there would be a risk to consumer protection both cross-border and domestically, and that there would not be a resultant increase in cross-border trade to benefit consumers.

That view is supported by various Eurobarometer and Flash Eurobarometer surveys that show fairly comprehensively that the problem is not the absence of a common EU sales contract. Consumer Focus does not support the Commission’s proposals because of insufficient evidence of need, legal uncertainty and cost. We know, therefore, that there is no proven case for bringing in this regulation.

Let me now turn to the issue that has vexed many commentators and is the basis of the reasoned opinion—subsidiarity. Subsidiarity is crucial, and I will not repeat the Minister’s explanation of this term, which was very good. As I have said, the evidence from the Commission is poor, and that lack of evidence in itself breaches the requirements of article 5 of protocol 2 of the treaty on the functioning of the European Union. As well as breaching the procedural requirements, the proposed regulation breaches the principle of subsidiarity. We are clearly on unsound foundations when looking at this proposed regulation and we all know what happens, especially in a European context, when things are built on insufficient foundations.

I hope that other Parliaments take a similar view and that they hear the views expressed today. Will the Minister assure the House that the Government will actively seek to persuade other European Union member Parliaments that they too should approach this matter in a similar way?

I could explore the issues around legal complexity and legal uncertainty. I could elaborate on the impact on domestic contract law where cross-border trading puts domestic traders at a competitive disadvantage. I could raise the damage that may arise to consumer rights from bringing in this proposed EU sales law, which would actually set back the improvements that we have seen. However, given that the House seems to be unanimous in wishing to see this draft regulation sent back to the European institutions with the reasoned opinion opposing it, I am content to draw my remarks to a conclusion.

In closing, may I commend those who have served on European Committee B and urge the Government to apply pressure at a European level—perhaps with the support of others in Europe—to ensure that we do not have to consider poorly evidenced proposals again? On that basis, let me say I do not wish to delay the House any further or object to this motion.

13:38

[The Parliamentary Under-Secretary of State for Justice (Mr Crispin Blunt)]

With the leave of the House, Mr Deputy Speaker, let me reply to the points raised in the course of this debate. I have taken careful note of all the points raised and they will of course further guide our work as we consult on this proposal in the next phase. As the House is aware we will have a proper public consultation on the proposed regulation in the new year. I know, however, that our general approach to this dossier has to date been supported by the scrutiny Committees in both Houses.

Let me pick up the particular points that have been made this afternoon. I commend my hon. Friend the Member for Stone (Mr Cash) and his Committee for the work that they have done on this instrument. I particularly welcome his contribution to the debate today. He drew attention to the contributions that have already been made by Consumer Focus, the Federation of Small Businesses and the Law Society. I want to answer the Opposition spokesman’s characterisation of the position—he said that absolutely no one out there thinks there is any merit in this measure apart from the Lord Chancellor—which is wrong on both counts. However, I will return to that and correct him.

My hon. Friend the Member for Stone made a substantive point in an intervention on my hon. and learned Friend the Member for Sleaford and North Hykeham (Stephen Phillips), who confirmed that he was entirely right to say that if article 352 were used, the European Union Act 2011 would require an Act of Parliament before a Minister could agree to it. The legal base is therefore important, and I have made clear the Government’s views, including our doubts about whether article 114 applies, which is an entirely open question.

My right hon. Friend the Member for Carshalton and Wallington (Tom Brake) asked whether the Government had assessed whether the new law would be more complex than that which currently exists, whether businesses could choose to opt into the process and whether that would leave them in a better position. There is a concern that having two alternative regimes could lead to confusion. It might also be too complex for many consumer transactions. The existing common law emphasises certainty—a point made by my hon. and learned Friend the Member for Sleaford and North Hykeham—but the law proposed in this case does not appear to have that emphasis. Again, this is an area where we need detailed legal analysis, which is ongoing. We will consider the views of interested parties, many of whom have significant expertise in this area.

That is an appropriate note on which to turn to my hon. and learned Friend. He drew on the remarks of the remembrancer of the City of London, who has suggested that the proposed measure might be the thin end of a wedge intended to introduce European contract law, thereby undermining the universality of English contract law. It is important to draw attention today—when Her Majesty is opening the Rolls building, a new and impressive commercial court—to the extremely extensive service that the legal profession in London provides to the entire world of commerce. That point ought to be given importance in our consideration of this matter.

As to whether this measure is the thin end of the contract wedge, I should point out that the scope of the draft regulation has been narrowed since the initial discussions began some years ago. The proposal that we are discussing covers the sale of goods and does not extend more widely into contract law. We would have to address any such proposals carefully, and will watch extremely closely if any proposals are made to widen the scope. Each will be considered on its merits. I can also reassure the hon. Member for Stoke-on-Trent South (Robert Flello), who spoke for the Opposition, that my right hon. and learned Friend the Lord Chancellor and I—and, indeed, the whole of Her Majesty’s Government—see no need for a general system of European contract law.

The tenor of the argument produced by my hon. and learned Friend the Member for Sleaford and North Hykeham was extremely clear, as was the expertise that he used to make it. He made a powerful point about the potential for increased transactional costs, not least because lawyers would face considerable difficulties in giving clear advice to small and medium-sized enterprises. He very properly pointed out to the House that if the measure were introduced, the cost of growing case law in this area to provide the necessary certainty would lead to a process that might take decades. The businesses using this form of law would bear the costs, as they would find out—either to their cost or otherwise—through the legal process of testing its bounds.

Finally, let me repeat, so as to make it perfectly clear, that the hon. Member for Stoke-on-Trent South wholly misrepresented the views of the Lord Chancellor. [Interruption.] I am grateful to hear the hon. Gentleman’s sedentary reassurances on that point, but it would be a service to the House if in future he did not seek to misrepresent positions that he plainly does not appreciate or understand. He then said that absolutely nobody was in any way positive about this measure. He was wrong about that as well.

[Robert Flello]

I am sure that the Minister normally follows every word I say very closely, but sadly he must have been distracted when I said that there was very little support outside. I did not say that there was no support, because the Federation of Small Businesses has said that it supports the measure. However, I reiterate the point that only 18% of people think that it would make a difference.

[Mr Blunt]

I am grateful for that intervention, because I had misheard the hon. Gentleman and would not want to mischaracterise his arguments. He makes the point that I was coming to, which is that the Federation of Small Businesses says in its submission that it sees an argument in principle for the measure, a point that was reflected in what my hon. Friend the Member for Stone said. In a sense, it is axiomatic that, at the European level, there would be a case for such a measure. The FSB has made it clear that its support for a common European sales law is dependent on its being clear and simple for small and medium-sized enterprises to use, without placing unreasonable burdens on business. We will look closely at those details in the consultation.

I can assure right hon. and hon. Members that any development in the Government’s position on the dossier will be made on the basis of good evidence of need and a robust analysis of the impacts. The Government will pay particular consideration to whether the proposed regulation is a proportionate response to the problems envisaged by the Commission, whether that response complies with subsidiarity and whether the treaty base is appropriate for the measures proposed. We will work with all those most affected by the change, engaging with business and consumer groups in particular. I hope and expect that we will incorporate contributions from Governments in other member states and from the European Parliament.

Let me answer the point made by the hon. Member for Stoke-on-Trent South, who suggested that Her Majesty’s Government should go around trying to encourage Parliaments in other member states to take an interest. We do not think it proper for Her Majesty’s Government to do that. Indeed, he will have heard the suggestion in my opening remarks to the effect that parliamentary groups and authorities should take up the challenge that he has thrown down to them. Given the law of unintended consequences, I fear that if the Government tried to do that, it might be less convincing than fellow parliamentarians trying to act on other national Parliaments, which might be rather more effective.

[Henry Smith (Crawley) (Con)]

It is indeed important that our Parliament should liaise with EU Parliaments on that point. Last week I had the pleasure of meeting some Danish parliamentarians—my counterparts on their equivalent to the European Scrutiny Committee—who are also opposed to this European measure. It is important that those representations are made through you, Mr Deputy Speaker, to other European Assemblies.

[Mr Blunt]

I think you have just had a request for action, Mr Deputy Speaker, from my hon. Friend the Member for Crawley (Henry Smith). I commend the work done by members of the European Scrutiny Committee, who have done a particularly good job here. We are going to work with Members here and in the other place and, of course, with the European Scrutiny Committee in taking forward work in this area.

Question put and agreed to.

Resolved,

That this House considers that the Draft Regulation of the European Parliament and of the Council to introduce a Common European Sales Law (European Union Document No. 15429/11 and Addenda 1 and 2) does not comply with the principle of subsidiarity, for the reasons set out in Chapter 5 of the Forty-Seventh Report of the European Scrutiny Committee (HC 428-xlii); and, in accordance with Article 6 of Protocol (No. 2) of the Treaty on the Functioning of the European Union on the application of principles of subsidiarity and proportionality, instructs the Clerk of the House to forward this reasoned opinion to the Presidents of the European Institutions.

London Local Authorities Bill [Lords]

Wednesday 7th December 2011 Commons Chamber

Consideration of Bill, as amended

Clause 3

Powers exercisable by police civilians and accredited persons

13:50

[Mr Christopher Chope (Christchurch) (Con)]

I beg to move amendment 5.

[Mr Deputy Speaker (Mr Nigel Evans)]

With this it will be convenient to discuss amendments 6, 8, 7, 9 to 14, 21 and 35 to 39.

[Mr Chope]

This Bill has been before the House for four years. Earlier this year, it went through an Opposed Bill Committee and as a result of the diligent work of its Chairman, my hon. Friend the Member for Great Yarmouth (Brandon Lewis), and its members, including my hon. Friend the Member for Chatham and Aylesford (Tracey Crouch) and the hon. Members for Scunthorpe (Nic Dakin) and for Gateshead (Ian Mearns), some of the clauses that were a cause of concern on Second Reading were removed. Many of those clauses were the subject of petitions.

Sadly, however—this is no criticism of the Opposed Bill Committee—sufficient consideration was not given to the clauses that were unopposed in the sense that they were not the subject of petitions. It is incumbent on us as legislators to assure ourselves that we are satisfied with the contents of these private Bills and that those contents are consistent with the principles that we apply to our law in general. What the Bill tries to do—this is why it is a private Bill—is to create a separate legal regime among the 33 London authorities or in certain circumstances just within the City of Westminster. As I say, it is incumbent on us to pay careful attention to the detail. That applies particularly to the powers relating to penalty charges, enforcement and recovery of costs—the powers that are dealt with in this group of amendments.

Amendment 5 to clause 3 would insert after “payable” in line 14 of page 3

“by the person being served”.

The fact that that phrase is omitted from the Bill exemplifies what I would describe as the sloppy, haphazard drafting, which often happens with private Bills. I think that when a private Bill has been before Parliament for four years, it should have been tidied up. Clause 3(1) reads at the moment:

“Where a designation order under section 38 of the Police Reform Act 2002 applies paragraph 1 of Schedule 4 to that Act…to any person, that person shall have the power of a borough council to serve a penalty charge notice…where he has reason to believe that a penalty charge is payable to the borough council”.

It does not say that he has to believe that the penalty charge notice is payable by the person on whom the notice is being served. It seems to me that that is pretty basic material, and that we should not have people going around serving penalty charge notices on people they do not believe to be the persons to whom the penalty charge applies.

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

Is it really the case that the Bill as drafted means that these officers could go around willy-nilly serving charges on people who had nothing to do with the penalty committed? Is my hon. Friend not absolutely right to say that this shows the shoddy drafting of the legislation?

[Mr Chope]

My hon. Friend is absolutely right to say that that would be the consequence and that it indicates the shoddy drafting. One has to ask why the provision is so broad brush. That is why I tabled amendment 5. It is only a small amendment; it does not address all that I think is wrong with clause 3, but it would at least remove part of the wide ambit and prevent people who have not been the subject of penalty charges from being served with penalty charge notices. One might ask whether it really matters if penalty notices are served on people who should not be served with them. It does if we also look at clause 4. If the person being served with a penalty charge notice to which he should not be subject, as he has been wrongly accused of having liability for it, is asked to give his name and address and refuses to do so, he then becomes under clause 4 a criminal and is liable to a summary fine on strict liability of up to £1,000.

[Mr Greg Knight (East Yorkshire) (Con)]

I hope my hon. Friend will forgive me for saying this, but could it not be argued that his amendment, too, is guilty of sloppy drafting? What would happen if his amendment were accepted and the responsibility belonged to a body corporate? Surely it would mean that the person serving the notice could not hand it to a director, but would have to post it or deliver it to the company’s registered office. That is what would happen if my hon. Friend’s amendment were accepted.

[Mr Chope]

If a body corporate were liable for the penalty charge, it could be served on its director. My right hon. Friend, who will have looked assiduously at the Bill, will know that there are references in clause 20 to the liability of directors for offences committed by a body corporate. I am not sure, therefore, that my amendment would be out of order in that sense. I think it would improve the Bill, given that the issue of corporate liability is covered by clause 20. Although I say it myself, I believe that amendment 5 will bring about a modest improvement in the drafting.

Amendment 6 is the second in the group; it would leave out subsection (2) of clause 3. That subsection talks about giving these powers, to which I have already referred, not just to the police or police community support officers, but to an “accredited person”. It proposes to make these significant powers available to anybody who is an accredited person. My amendment would leave out the provision to enable those accredited people to have the powers given to PCSOs.

Amendment 7 would likewise leave out subsection (3), which is consequential, as it states:

“An accreditation may only specify that subsection (2) applies to an accredited person”

and so forth. That will be taken out, so that clause 3 would not apply to accredited persons.

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

Can my hon. Friend explain who accredits those persons? How do they become accredited?

14:00

[Mr Chope]

That is a very good question, but it is probable that only the promoters of the Bill can answer it definitively. It seems to be a rather murky area. I do not think that we should build up a bureaucracy in this country in which a lot of officials are going around with powers to ask people for their names and addresses and to ensure, if they refuse to give them, that they are subject to criminal penalties including fines of up to £1,000, when it is not known who those officials are. There will be plenty of opportunities for bluff and bluster. Who will do the accrediting, how will those who do the accrediting be made accountable, and who will know who they are? I trust that my hon. Friend the Member for Finchley and Golders Green (Mike Freer), will be able to respond to those and other questions, because I understand that there is a fair amount of support among the Bill’s supporters for an extension of the powers to accredited people.

I think that the answer to my hon. Friend’s specific question can be found in the schedule to the Police Reform Act 2002 that contains definitions relating to accredited persons. However, I must admit that the interaction between those definitions and what is in the Bill is not exactly as plain as a pikestaff to me.

[Mr Knight]

I am grateful to my hon. Friend for giving way to me again. He is being very generous.

We all know that a police officer who is involved in the issuing of a fixed penalty ticket will have been trained in the rules of evidence, and will know that the starting point should be a presumption of innocence. What assurances does the Bill give us that an accredited person will have been given similar training in our law? Does it contain any provision to prevent a local authority from putting an accredited person on a pay scale enabling that person to receive a bonus based on the number of tickets that he or she issues? In other words, might the accredited person have a vested interest in giving out tickets willy-nilly, even when no offence has been committed?

[Mr Chope]

My right hon. Friend has made a powerful point. There is evidence that local authorities have given just such financial incentives to their officials, based on the number of people to whom they can issue tickets for offences, or alleged offences. The Bill would give those same officials an additional power to issue penalty notices.

One of the weakest parts of the “accredited person” concept, which does not apply under the present law, is that someone who declined to give his name and address to an accredited person would be guilty prima facie of an offence, but the accredited person himself would have no power of arrest. What would he do then? Would he just wait there? If he were a police community support officer, he would be able to ask the person to wait for up to half an hour for a police officer to arrive, and the police officer could exercise his own power to arrest the person concerned for not having given his name and address. However, no such power extends to accredited persons. This provision would not work in practice, and I do not think that it has been thought through by the promoters.

[Jacob Rees-Mogg]

I am grateful to my hon. Friend for giving way again. Perhaps he could answer two questions. First, will the accredited people have to wear a uniform of any kind? I wondered whether they might wear bowler hats, for instance, so that it would be clear that they were from the council—proper, thoroughgoing bureaucrats. Secondly, would an accredited person who used his bowler hat to detain someone whose name he wanted be potentially guilty of false arrest?

[Mr Chope]

The answer to my hon. Friend’s second question is yes. As for what uniform would be appropriate, I think that there is much to be said for requiring the accredited people to wear bowler hats, because they could be easily identified. People would know when an accredited person was approaching, and would be able to scarper. There is a lot of common sense in that suggestion from my hon. Friend. A better solution, however, would be not allowing the Bill to extend the power to accredited persons in the first place.

Amendment 8 mirrors amendment 5, again proposing the insertion after the word “payable” the words

“by the person being served”.

I do not think that I need go into it further.

[Philip Davies (Shipley) (Con)]

Why not?

[Mr Chope]

I am grateful to my hon. Friend for his sedentary intervention, because it has given me an opportunity to welcome him to the Chamber. Unusually for him, he has been a bit late in arriving. I am afraid that he will have to look at the Official Report to find out what I said in support of amendment 5.

Amendment 9 proposes that clause 4 should be left out completely. Clause 4 relates to the power to require names and addresses. This goes to the heart of the whole issue of civil liberties. Increasingly in this country, we are seeing a departure from the principle that people cannot be required to give their details to anyone who comes up to them and says, “I require your name and address.”

In preparation for the debate, I looked at a website called freeBEAGLES, which provides “legal advice for activists” and includes some helpful advice on when people are and are not required to give their details. For instance, it states:

“Other than under road traffic and anti-social behaviour legislation, you do not commit an offence in English law by refusing to give your name and address to the police.”

The Bill refers not to the police but to accredited people and police civilians. The advice continues:

“However there are certain situations where the police may arrest you if they cannot establish your name and address”

—Members should note that it is the police who can do the arresting—

“and if you are arrested and charged with an offence you will be unlikely to be granted bail unless they can establish these details.”

It adds that the general principle

“is that you never have to give your name and address to the police prior to arrest”

unless

“the police reasonably suspect you of a non-arrestable offence, and require your name and address for the service of a summons …where you are the driver of a vehicle…where the police say they suspect you of ‘anti-social behaviour’”.

[Philip Davies]

Will my hon. Friend explain how this will work in practice? If someone who is asked for his name and address by a representative from the council makes up a name and address, what mechanism will the council have to check the information and establish whether it was genuine?

[Mr Chope]

At present, a council officer has no more power than any other individual. Let me cite a constituency case. Someone with a shopping trolley ran into and damaged a car belonging to one of my constituents in Christchurch. My constituent saw that the trolley had dented the car, but the person who had been pushing it then got into her own car and drove away. My constituent tried to identify the person by asking the Driver and Vehicle Licensing Agency for details of the registered keeper of the vehicle. The DVLA could not give her the details, however, because no criminal offence had been committed. It might have been accidental criminal damage, but it was a civil matter and therefore the DVLA could not release the details that would have enabled her to bring a civil action against the individual.

That is similar to the situation before us: if somebody commits a civil offence but their identity cannot be ascertained or they were not photographed, hard luck! Nothing can be done about it. Obviously if the person is driving a vehicle, specific laws apply requiring them to give their name and address to the police. [Interruption.] My hon. Friend the Member for Shipley (Philip Davies) looks a bit perplexed and disappointed, but if he analyses the matter, I am sure that he would agree that it would be wrong to allow people to make accusations and then immediately, on the back of those accusations, require people to give their names and addresses, and to back that up with criminal sanctions for failure to give either a name and address or an accurate name and address.

[Philip Davies]

I absolutely agree with my hon. Friend—I take his point and I support his amendment—but there is one thing that I still do not understand. The clause that he wants to delete states that someone

“commits an offence if…he gives a false or inaccurate name or address”,

and would be liable to conviction and a fine. If his amendment is not accepted and someone gives a false name and address, how on earth would they be found out in order for a fine to be imposed?

[Mr Chope]

My hon. Friend makes a good point that the sponsor of the Bill may wish to address later.

[Jacob Rees-Mogg]

I am sorry to keep on interrupting my hon. Friend, but his speech is so compelling and raises so many fascinating aspects of each clause. If councils can find out people’s names and addresses, would they need a gigantic and expensive national database of names and addresses? If so, who would pay for it—Westminster city council or Her Majesty’s Government?

[Mr Chope]

I hope neither, but my hon. Friend is right that as sure as night follows day, what follows from this sort of power is the establishment of databases. That is very sinister.

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

I sympathise extensively with what my hon. Friend says about the civil liberties issues, but on this specific matter I suspect that the official concerned would have computer access to the electoral register and could therefore make at least a cursory check, although that might not necessarily resolve the matter. Is his concern—it is a relatively valid one, and I would be interested to hear what the promoters think—that were clause 4 to be deleted, law-abiding citizens would find themselves subject to the penalties under clause 3, while less law-abiding citizens would get away scot-free? In other words, there would be a strong disincentive for those willing to play by the rules, while others would find a way of avoiding the consequences. Although I accept his civil liberties argument, surely there is a concern that many pedlars of no fixed abode, or of an abode many miles away, could get away with such things more easily than others.

[Mr Chope]

My hon. Friend almost answered his own point in his preamble, when he said that this was a civil liberties issue. I think that he and I agree. If there is a civil liberties issue, on the whole our instinct is to come down on the side of maintaining the civil liberty rather than giving an arbitrary power to an official to intervene—a power that might be subject to abuse or result in oppression, and which would certainly undermine the long-standing principle in this country that people are not required to give their name and address to any Tom, Dick and Harry whom they happen to meet in the street.

[Jacob Rees-Mogg]

Following on from the point made by my hon. Friend the Member for Cities of London and Westminster (Mark Field), will my hon. Friend explain how somebody of no fixed abode could give a false address? If someone does not have an address, they cannot give either a right one or a wrong one. Would they be penalised simply for being of no fixed abode?

14:15

[Mr Chope]

Again, my hon. Friend is spot on. I am not sure whether the promoters have thought about that. It seems that if someone gave their name but could not give an address—because they did not have one—they would automatically be guilty of failing to supply a name and address, if there were not the defence of reasonable excuse, so they could be penalised merely for being itinerant or vagrant. This is another example of the law of unintended consequences that so often applies to private Bills that have not been thought through properly.

[Philip Davies]

I suspect that my hon. Friend the Member for Cities of London and Westminster (Mark Field) is right: the officials would probably use the electoral register to check the names and addresses that people give. Would my hon. Friend agree, though, that there are a multitude of reasons why somebody’s name might not yet be on the electoral register at a particular address, so that does not mean that they have given a false name and address? The register may not yet have been updated. Would it not be worrying if local officials were handing out fixed penalty notices or fines on the basis of who is on the electoral register?

[Mr Chope]

I agree with my hon. Friend, but this opens up a much larger debate that we will not go into now—the whole question of the electoral register and the proposed changes to it. The Government are thinking of effectively making filling in the registration form voluntary. The powers in the Bill, coupled with people’s freedom to decide whether to put their name on the electoral register, could result in a significant reduction in the number of people choosing to do so.

[Mr Nuttall]

My hon. Friend is making a compelling speech, but could he deal with a point that we have not yet touched upon? What about cases in which a visitor to this country from abroad, who may have no knowledge of our procedures, gives a foreign address that cannot be checked against the electoral register?

[Mr Chope]

My hon. Friend cites another good example. Again, the conscientious law-abiding citizen could find himself penalised, while an irresponsible person from overseas might get away scot-free. That will create increasing resentment. There is already enough resentment in this country against some foreigners, and we do not want to do anything that will increase that resentment.

[Philip Davies]

If a constituent of mine, confident that they did not have to give their name and address to a local council official in Shipley, came down to London and was asked by a council official to give their name and address, they would reasonably expect the same rules to apply in London. Would it not be perverse were they found to be breaking the law because of some rather officious rule introduced in London that did not apply in any other part of the country?

[Mr Chope]

My hon. Friend is on to a really important point: if we are to change the balance between officialdom and civil liberties, it should be done nationally rather than on an ad hoc, case-by-case basis, which could lead to laws in London being different from those in Shipley—different, indeed, from those anywhere else outside London.

It should be for Home Office Ministers to come forward with these proposals, if they think it reasonable to extend such powers to councils in the way suggested in the Bill, but they manifestly have not done so; there have been extensions, but nothing in this area, despite the fact that the Bill was printed back in 2007. The Government have not chosen to extend these powers to police community support officer and others, or to extend officials’ ability to require names and addresses nationally. Implicit in that is that the Government would not support such an extension of restrictions on civil liberties. If they do not support such restrictions on civil liberties nationally, why should they support them in London?

[Mr Knight]

Is the following statement an accurate précis of the situation: my hon. Friend’s amendments are an attempt to thwart the promoters of the Bill who are seeking to decriminalise a number of offences and to replace them with a far more draconian council-operated system?

[Mr Chope]

Yes. Over time, offences have been decriminalised, and when I was a Transport Minister I supported the decriminalising of offences, but I never had in mind that that would be coupled with extending the powers of the police to deal with people such as those who do not give their name and address, and there are not as strong safeguards in respect of officials as there are for police officers.

The income or yield from decriminalised offences goes straight into the coffers of the local authorities, and local authorities cannot expect to have it both ways. They cannot expect both to receive all that money and to have the powers of the police given to their officials. My right hon. Friend therefore highlights a key issue.

We must remember that over time the Cities of London and Westminster and the London local authorities have salami-sliced the powers and rights of individual citizens in favour of bureaucratic local government. If this Bill is passed unamended, it will be argued that that trend should be extended, yet this Bill will not have been subjected to the same degree of parliamentary scrutiny as a public Bill.

[Mr Knight]

Is there any popular support for this measure? A number of colleagues representing London constituencies are present, but not a single Opposition Back Bencher is in the Chamber. It does not seem to me that there is popular demand for this measure. I can understand why money-grubbing council officers might want this matter to proceed, but do the public?

[Mr Chope]

My right hon. Friend makes a good point. It certainly appears that the public’s representatives are not keen on this matter. Although I have not checked the No. 10 website to see whether there is an online petition with hundreds or thousands of signatures in support of this Bill, I suspect not, and I think we would have been told about it if there was. The Bill’s passage through this House has not yet concluded, however, so it is still open to somebody to start an online petition in support of it, and against today’s amendments.

[Mark Field]

I have some sympathy with the view that certain parts of the country should not have an entirely different regime, and I share many of my hon. Friend’s concerns about council or local authority officers having these powers—although I am a big supporter of the two London local authorities in my constituency. However, I do not think he can legitimately argue that there has not been an opportunity to scrutinise this Bill properly, as it has had far more scrutiny than any Public Bill would normally receive, not least over the past four years as it has slowly made its way through the House and the other place.

Does my hon. Friend also recognise that there are differences between London and, for instance, the leafy parts of Christchurch that he represents in sunny Dorset? There is a huge mass of humanity in London, particularly in the centre of the metropolis, and that gives rise to at least the idea that there should be a slightly different regime for some public order and health and safety matters compared with those for the wide acres of much of the rest of England. If we believe in localism, as I hope many of us do, there is a place for having somewhat different regimes of bylaws, and I suspect they would be understood by many people who visit central London even from faraway places such as Shipley, Bury North or East Yorkshire.

[Mr Chope]

My hon. Friend is doing a great job in defending his local authorities, and I hope that as a result he will in due course be granted the freedom of his boroughs, if that has not already happened. I accept what he says about localism and about London, especially parts of central London, being different in character from other parts of the country, but I do not believe that we should have one regime of civil liberties in London and another elsewhere. If that were the case, we could, for instance, introduce much more draconian laws for people causing trouble or holding demonstrations in London. Nobody has yet suggested we should have a different criminal law according to where an offence takes place, yet that is what we are building up to under this decriminalised regime of law. It will result in alternative sets of laws applying to London as opposed to the rest of the country.

I argued that point when we were discussing various Bills concerning pedlars. Pedlars travelling across the country want the certainty of knowing what the law is; they do not want different laws in different parts of the country. That argument applies even more strongly in the context of whether someone has the right to ask for our name and address and whether we will be subject to a criminal penalty if we refuse to give that information.

Clauses 3 and 4 address important matters of principle, and amendment 10 seeks to alter clause 4 as follows:

“leave out ‘a community support officer or an accredited person’ and insert ‘or a community support officer’.”

Amendments 11, 12 and 13 address the same theme, and seek to remove from clause 4 powers relating to accredited persons and to confine them to police community support officers. The reasoning behind that is the same as the reasoning I articulated in respect of the amendments to clause 3.

[Mr Knight]

As ignorance of the law is not a defence, if these amendments are not accepted by the Bill’s promoters, is there not a case for requiring details of this different regime to be included in every tourist guide to London?

[Mr Chope]

I do not want to advertise, but I agree that readers of tourist guides such as those produced by Lonely Planet and Rough Guides might find it useful to know about such penalty regimes. I am sure that if this legislation is put on to the statute book in its current form the editors of those books will want to ensure they are up to date in respect of the fact that there are fewer civil liberties in London than in other parts of the country, as visitors may wish to steer clear of London in order to enjoy the full range of English freedoms outside London. Those are important points.

[Philip Davies]

In respect of this group of amendments, instead of simply restricting the provision so it applies to community support officers and not the accredited persons of the county, would it not be better to delete it entirely, because if it applied solely to community support officers, councils would be for ever tying up their time by ringing them up to ask them to come and carry out these functions, when the public want community support officers to be a visible police presence on the ground deterring proper crime?

[Mr Chope]

I agree, which is why I have tabled amendment 9 seeking to leave out clause 4 entirely. I have provided an alternative solution so that if we cannot leave out the whole of clause 4 we can at least leave out the part of it relating to accredited persons. Fortunately, both amendments have been selected for debate by the Chairman of Ways and Means, so it is up to the House to decide whether it prefers the entire removal of clause 4 or a modified version of it deleting the reference to the accredited persons.

[Philip Davies]

Has my hon. Friend any idea how often these provisions would be enforced, if his amendments were not accepted? How many times would local authorities expect to be demanding somebody’s name and address? It would be nice to know how much time our PCSOs would be expected to give to pursue this line of inquiry on behalf of local authorities.

14:30

[Mr Chope]

Again, that is a very important point. On a Bill such as this, we do not need to have any cost-benefit analysis or any financial memorandum setting out what the costs are going to be, but I imagine that the Bill’s promoters are discussing the matter with their local authorities and that elected representatives in London are conscious of that fact.

On the quantity issue, I know that I speak on behalf of lots of members of the Government—the leader of the other place and others—who have spoken out strongly against Westminster city council’s proposed extension of restrictions on street parking on Sundays. If that goes ahead, we can expect that it will result in many more fixed penalty notices as people are caught unawares, and that in due course will result in more of these notices being served in the way described in clauses 3 and 4, whether or not by accredited people or community support officers. It is likely that there will be an increase in the bureaucracy and the activity of unelected officials, and a consequent diminution in the civil liberties of the ordinary citizens.

[Mr Nuttall]

On amendment 10, is there not a danger that there would be an expectation, in these straitened times, of these accredited persons covering their salaries by issuing penalty notices?

[Mr Chope]

That is an important point, because most borough councils are saying that they are short of funds and will want to ensure that these accredited people at least cover their costs. In order to do that, these authorities may well give these people incentives to ensure that they get sufficient income for their activity in any tour of duty. So that is another serious problem. As far as I am aware, we have never had a system in this country where police officers are incentivised for the number of arrests they make, but it seems that people are being incentivised for the number of civil offences they can detect.

[Mark Field]

Although I very much understand the concern raised by my hon. Friend the Member for Bury North (Mr Nuttall) on incentivisation, I should put the following point on the record: Westminster city council has often been accused of incentive schemes for its parking attendants, but it is the case, and has been expressly so over past four years at least, that there is no such incentive scheme. In other words, traffic wardens do not have any sort of quota or incentive to issue tickets, and one very much hopes that a similar regime would apply to offences under this Bill.

[Mr Chope]

Amendment 14 is, again, a consequential amendment relating to the need to remove references to an “accredited person”. Amendment 21 deals with a different part of the Bill, but again no explanation is given as to why it is thought necessary to include the change being made in the Bill. The explanatory notes state:

“Clause 8 amends the City of Westminster Act 1996 which provides Westminster City Council with enhanced enforcement powers in relation to unlicensed sex establishments. The first amendment is a minor typographical amendment and the second amends section 8 of the 1996 Act, which relates to the service of notices. Under section 8, if notices under the Act are to be served by post, then they have to be served by registered post or the recorded delivery service. The amendments would enable notices to be served by ordinary post.”

Surely it is important that the notices should be served by registered post or recorded delivery, because that means there is a tracking service and Westminster city council will know whether or not the notices have been properly served. The idea is that the notices should be sent by what is described in the explanatory notes as “ordinary post”, but that is becoming very much below par for many people, as it is increasingly unreliable. Are we really saying that delivering a letter with someone’s name on it to a block of flats is going to count as proper service in respect of the enforcement powers in clause 8? Nowhere is it explained why it would be fair, reasonable or equitable to change the long-established way of sending out such notices, which is by recorded delivery or registered post. Apart from anything else, some of us are keen to encourage Royal Mail and give it income, and this proposal would deprive it of income that it is currently able to obtain from such notices being sent by recorded delivery or registered post. The case for this change is just not made, so my amendment 21 would remove subsections (3) and (4) from clause 8.

[Philip Davies]

May I tap into my hon. Friend’s legal expertise, because his amendment could well be very helpful to Westminster city council? What would happen if something was sent out by ordinary post and the intended recipient simply said that they did not receive it, whether or not that was the case? Would that nullify the provisions detailed in that letter? Perhaps he knows whether or not that would make a difference.

[Mr Chope]

Again, I do not purport to be an expert on this Bill, and my hon. Friend the Member for Finchley and Golders Green may wish to respond on that matter when winding up this debate. The explanatory notes are totally silent on this issue and to obtain the right answer one would need to have a greater knowledge than I have of the enforcement powers in relation to unlicensed sex establishments in the City of Westminster.

I have almost got to the end of this group, but I shall now deal with amendments 35 to 39 to clauses 18 and 20. I find clause 18 to be particularly offensive, because it creates a new criminal offence, stating:

“Any person who intentionally obstructs any authorised officer acting in the exercise of his powers under this Act shall be guilty of an offence and liable on summary conviction to a fine not exceeding level 3 on the standard scale.”

In other words, they would be subject to a fine of up to £1,000. There used to be an offence on the statute book of obstructing a police officer in the execution of his duty, and there probably still is. In the days when I used to practise a bit in the criminal courts as a barrister, what one might describe as an “over-enthusiastic” or “over-zealous” police officer might often throw in a couple of charges of obstruction in the execution of duty to press a point home against a hapless defendant. If that was happening with the police, how much more dangerous is it for civil liberties for the authorised officer to be able to say, “You’ve obstructed me, so I will make sure you get a £1,000 fine”? The decision about what the obstruction would be and so on would be left to the officer, and I think that goes far too far.

[Jacob Rees-Mogg]

Adding up all these fines, there seems to be £1,000 under clause 18 and another £1,000 under clause 4. Does my hon. Friend think that these councils are very hard up?

[Mr Chope]

That might be the situation. They seem just to have gone for level 3 fines, which are a maximum of £1,000, but there is no explanation for choosing that penalty, so I cannot answer my hon. Friend’s point, I am afraid.

The provision on the obstruction of authorised officers goes far too far, giving rise to the creation of an inappropriate criminal penalty.

[Philip Davies]

The clause actually refers to somebody who

“intentionally obstructs any authorised officer”.

Has my hon. Friend any idea what constitutes an intentional obstruction and what might be termed an unintentional obstruction?

[Mr Chope]

Exactly. To go back to the example given by my hon. Friend the Member for North East Somerset (Jacob Rees-Mogg), somebody who sees the authorised officer with a bowler hat and heads off in the opposite direction might be regarded as intentionally obstructing the officer. Who knows? If we are going to create new offences, it is important that they should be very tightly drawn so that they can be clearly understood. The offence in the Bill is wide and vague and therefore oppressive, and that is why I find it particularly offensive.

I was amazed to see the wide terms in which clause 20 has been drafted. Without taking up too much of the House’s time, it is worth spelling out exactly what it says. It states:

“Where an offence under this Act committed by a body corporate is proved to have been committed with the consent”,

we can understand that,

“or connivance of, or to be attributable to any neglect on the part of, a director”,

again, we can understand the reference to a director,

“manager, secretary or other similar officer of the body corporate or any person who was purporting to act in any such capacity, he, as well as the body corporate, shall be guilty of the offence.”

Subsection (2) states:

“Where the affairs of the body corporate are managed by its members, subsection (1) above shall apply to the acts and defaults of a member in connection with his functions of management as if he were a director of the body corporate.”

If the clause was the result of a competition among law students to see who could draft the most unreasonably wide new criminal sanctions against corporate bodies, the person who drafted this would probably get a capital alpha. It is drawn so widely and so unreasonably that, I would submit, it cannot have been analysed properly. I cannot believe that the promoters of the Bill really want the clause to be in the condition it is in at the moment.

[Philip Davies]

I totally agree with my hon. Friend. It is not only unreasonable but totally and utterly ridiculous. Can he offer any suggestion at all as to why the Bill and the clause specifically pick on secretaries? I can imagine that if someone was particularly illiberal, as the people promoting the Bill appear to be, they might want to pick on directors and managers—I can see why they would be the obvious target for people who wanted to go down this illiberal route—but can my hon. Friend think of any reason whatsoever why anybody would reasonably want to attack secretaries in particular?

[Mr Chope]

I can think of all sorts of reasons, but I do not necessarily want to share them with the House in response to my hon. Friend’s intervention. I would not say, as my hon. Friend did, that it would be reasonable to include a manager. A director of a company or organisation has a particular responsibility and although it might be over the top to extend the provision to them, I thought the best thing to do was to try to limit the corporate liability to a director who committed an offence directly.

14:45

[Mr Nuttall]

Does my hon. Friend agree that it might have been better if the clause, rather than using the word “secretary”, had referred to “company secretary”, which is definable in law?

[Mr Chope]

That would have been an improvement, but I hope that my hon. Friend will think it better to support my amendment, which effectively removes any references to managers, secretaries, other officers or any person purporting to act in such a capacity.

I have introduced as briefly as I could some of the reasoning behind my amendments, which have been grouped together. I would like to tell hon. Members who have been following this debate—the hon. Member for Derby North (Chris Williamson) has been sitting patiently on the Opposition Front Bench and will, I hope, participate—that at about 1 o’clock, when it looked as though this business would start at nearer 4 o’clock rather than 10 minutes to 2, I received a phone call from the counsel acting on behalf of the promoters of the Bill. I needed to sit down at this point, because I was told that some of my amendments would be acceptable to the promoters.

In anticipation of the response that my hon. Friend the Member for Finchley and Golders Green will make to this debate, perhaps I can explain to the House my understanding—and he can correct me if I am wrong—of the amendments that the promoters will be willing to accept in this group. I understand they include amendment 5, which inserts

“by the person being served”

into clause 3 in line 13 of page 3, and its mirror, amendment 8, which inserts the same words into that clause in line 20. They also include amendments 10, 11 and 12, which deal with leaving out the references to accredited persons from clause 4 and remove references to the powers of accredited persons to require a name and address and to instigate a criminal penalty when that name and address is not supplied, as well as amendment 14, which is consequential on the removal of the references to accredited persons. I am also told—I think I am correct—that the promoters are willing to accept my amendment 35, which would leave out clause 18 on the obstruction of an authorised officer. I understand that amendments 36 to 39, which would introduce my amendments to clause 20, thereby limiting the liability to a director or directors, would also be acceptable to the promoters.

We will have to see what happens, and of course the procedural way of dealing with matters will be in your hands, Mr Deputy Speaker, but if that large number of amendments is acceptable to the promoters, I hope the amendments will be able to go through on the nod in due course. There is a lot more meat to this group of amendments than just those that have been accepted by the promoters, but it would be churlish of me not to thank my hon. Friend the Member for Finchley and Golders Green for at least agreeing to those amendments. Of course, none of the amendments could have been discussed if we had not blocked this Bill and required its consideration in the House on Report. Whatever happens, if the promoters accept the amendments, the Bill will be better than it would have been without them.

[Mike Freer (Finchley and Golders Green) (Con)]

I have greatly enjoyed this perambulation around local government, with bowler-hatted civil servants prodding miscreants with their money-grabbing umbrellas, but that picture bears no relation to the local government that I know. My hon. Friend the Member for Christchurch (Mr Chope) and I have sparred on this Bill in the past—I still have the scars—but I appreciate the vigour and genuine honesty of his approach to scrutiny and to his amendments.

The Bill would not simply allow any local authority employee to prowl the streets of their borough looking for fines. Certainly, the concept that they would be able to collect £1,000 a go as they went about their business is fanciful. I understand that fixed penalty notices would have a set price and would be collected by the borough. The £1,000 fines to which Members have referred would be applied only by magistrates at their discretion and not by local authorities. I shall come back to whether my hon. Friend's amendments remain acceptable.

The Bill has been scrutinised by the Opposed Bill Committee and I am grateful to its members for their work. My hon. Friends the Members for Shipley (Philip Davies) and for Christchurch have made some valid points about civil liberties, but what about the civil liberties of the silent majority who are tired of the antisocial behaviour of a small number of individuals and corporate bodies? It is the silent majority—the council tax payers—who are having to pick up the bill for clearing up enviro-crime. This low-level antisocial behaviour plagues many parts of the country, including the parts of London we are discussing.

I know that my hon. Friend the Member for Shipley takes a great interest in combating antisocial behaviour. Indeed, he has gone on record as supporting Mayor Giuliani’s zero-tolerance approach to antisocial behaviour and the broken window syndrome. I believe there has been a local problem in his constituency with youths ripping out flower beds and generally causing litter, about which he has called for police intervention.

[Philip Davies]

My hon. Friend is absolutely right—I do take a zero-tolerance approach to antisocial behaviour and to crimes being committed—but as he has said, I have urged the police to take action. I have not called for the local authority to have wide-ranging powers to tackle this issue. I think that is where he and I part company.

[Mike Freer]

I am grateful for my hon. Friend’s intervention and I guessed that was where we would part company. I wish him luck in getting the police to deal with flower beds being turned over, litter outside fast-food establishments and litter being thrown out of cars, because I simply cannot get my local borough command to take those issues seriously. We could argue for a whole afternoon about whether these are serious crimes and whether the police ought to deal with them, but that is a different issue. The current problem is that the police in London, certainly—I cannot comment on the borough command in Shipley—will not prioritise dealing with litter and enviro-crime. Therefore, we must either leave the issue to fester or allow authorised officers of the local authority to deal with it.

On accreditation, the idea is not that every employee of a council will have the power to go out and start levying fixed penalty notices or taking people to the magistrates court to be fined. We are talking about civil enforcement officers who are already accredited and have significant training on how to prove that an offence has been committed. Councils also have environmental health officers who are highly trained and accredited on how to follow the rules of law and how to provide evidence should a case have to go to court. The notion that the town hall cat will be wandering around the borough levying fines is fanciful. We are talking about seriously trained officials who have been taught how to comply with the law and how to make sure that if there is a prosecution, evidence can be provided.

There are already a number of police civilians—not just police community support officers but accredited civilians—who have the authority to issue notices. We have talked about whether London should be exempt and be a special case, but it is often the starting point for national legislation. It is not unusual for London to set the tone and for other parts of the country follow suit, but it is not only London that does that. I do not know whether many Members are acquainted with Brunel university, but apparently its security officers can issue fixed penalty notices. This is not just about widening scope because London has asked for it—a significant number of authorised civilians can already issue such notices. What we are saying is that London has some specific problems and that specific powers are needed for accredited, trained individuals.

I have covered the point about £1,000 fines being targeted willy-nilly, which simply is not true. That would be the remit of the magistrates court. Let me make a point about the powers of authorised officers. They would be able to take action only where they believed that someone was committing a criminal offence, so the powers would not be used in respect of people going about their lawful business. Hon. Members have talked about conscientious, law-abiding citizens, but conscientious, law-abiding citizens would not be stopped and asked for their name and address and would not face the risk of prosecution. Only those believed to be committing an offence would be caught by the rules in the Bill.

The issue of people giving false names and addresses has been raised. Clearly, with matters such as littering from cars, accredited officers would have access to the registration number, which could be cross-checked with the Driver and Vehicle Licensing Agency. Many of the enviro-crimes that we see in London boroughs involve repeat offenders, particularly corporates—the large retailers that cause litter on the high street—or other organisations that cause problems on our high streets. Much dumping in our residential streets also involves repeat offenders and there may be a corporate address that officers can go back to if they believe or find out that they have been given a false name and address by the person they have stopped. Clearly, if a false name and address is given by someone of no fixed abode, that person cannot be prosecuted. That is a common problem with the current law that police officers face.

[Philip Davies]

I am slightly puzzled about the corporate causes of litter. Is my hon. Friend insinuating that if somebody walks into a McDonald’s, buys a Big Mac, fries and a Coke, leaves McDonald’s and drops litter on the floor, the responsibility for the litter lies with McDonald’s? Surely the only person with whom the responsibility lies is the person who dropped the litter, and the company cannot be held accountable for what its customers do.

15:00

[Mike Freer]

That is the very point. There are two issues. McDonald’s is a fine organisation based in my constituency. It takes a great deal of trouble to ensure through litter patrols that its customers do not create a nuisance, but if an organisation—say, Finchley Fried Chicken—decided to pour fat over the pavement, which sounds fanciful but has been known to be true, the officer can deal with that corporate body. However, if a person who has bought a take-away from Finchley Fried Chicken then chooses to drive down my street, which they do—I declare a passionate interest in the subject, as my street is often littered with take-away cartons—it is the person throwing the litter from the vehicle who would be stopped and served a notice. My hon. Friend is quite right: there are two issues. The corporates that are guilty of misdemeanours, such as dumping fat, will be dealt with as a corporate body, but if someone is caught throwing litter from a car, it is the litterer who would be caught.

I know that these measures sound draconian, and they often are in black and white. Some Members may have a dim view of council officials. As a former leader of the London borough of Barnet, I can tell them that my officers took great care to ensure that the powers vested in them were used very sparingly and only where the offence was commensurate with the action that they proposed to take.

My hon. Friend the Member for Christchurch was correct that the promoters of the Bill suggested that we could compromise on the amendments. However, my hon. Friend has not been able to compromise on some of them. We will therefore continue to sponsor the Bill unamended, apart from the three amendments suggested by the promoters.

[Jacob Rees-Mogg]

I support the amendments tabled by my hon. Friend the Member for Christchurch (Mr Chope). He has made a noble effort to turn a pig’s ear into a silk purse. One can see a vision of all the mulberry trees in China, with all the silkworms on them working busily away to provide enough silk to produce a purse, but I fear that even these fine worms have failed in their effort. Even though I support the amendments before us, the Bill remains broadly a pig’s ear. Let me go through it point by point, one by one, as quickly as I can so that others may speak on these important subjects.

Amendment 5 deals with clause 3 on “Powers exercisable by police civilians and accredited persons”. How worrying it is, how concerning that legislation should be drafted in such a way that the penalties might be issued to somebody other than the person by whom the penalty ought to be paid. You, Mr Deputy Speaker, of all people, as innocent, as pure as the driven snow, could find some accredited person coming along, catching you by the scruff of the neck—an outrage in itself—and saying, “This penalty is for you,” when you had nothing to do with it, you knew nothing of it, you were, as I said, not guilty and as pure as the driven snow.

With the amendment tabled by my hon. Friend the Member for Christchurch things begin to be tided up a bit. We put in the words

“by the person being served”.

That seems right and proper and sensible, even though the clause itself is not particularly attractive.

Now let us come on to these accredited persons. My hon. Friend the Member for Finchley and Golders Green (Mike Freer) made them sound like very nice approachable chappies who are all doing a good day’s work and fine stuff. I am sure that that is true of many of them, but do we not have in our mind—have we not always had in our mind—that vision of the officious traffic warden who comes round, the jobsworth who is out to get you, who stands there, shaking the parking meter, waiting for the seconds to tick past so that a £70 fine, going up to £140 if you do not pay it quickly, whacks upon your head? Is that the type of accredited person we wish to see going around?

Does that not most fundamentally, and as a point of the greatest principle, undermine the role of constable? We have had in this country, since the founding of the Metropolitan police by Sir Robert Peel, a system of constables who have a warrant from the Crown, are trained, are authorised and are in a position to exercise fine judgments. They are regulated in a different way from others. They have different terms and conditions of service. They cannot go on strike, for example. We noticed this only last week, when we saw that the police, that fine body of men and women, were doing their duty while others were on strike.

Do we not downgrade the police when we have these accredited persons who suddenly can wander around and issue penalties—accredited by the council, we know not how; the type of accreditation given to them, we know not what, but we do know that it is not a constable with the full majesty of the law and the warrant of the Crown behind him or her? Once we start doing it in London, as my hon. Friend the Member for Christchurch and Golders Green, or rather, for Finchley and Golders Green—I know that my hon. Friend the Member for Christchurch has territorial ambitions, but probably they do not go that far—said, what happens in London may spread out to the rest of the country.

Let us be absolutely clear. In North East Somerset we do not want this. We want the proper office of constable to be upheld. People in Nempnett Thrubwell do not want somebody appointed by the council to come round and dig them in the ribs when they accidentally drop a little bit of mud off their wellington boots or something like that, and are then accused of dropping litter. We must object. My hon. Friend is right to have objected to the principle of the accredited person because of the way in which it downgrades the role of the constable—a great and noble role.

I saw the chief constable of Avon and Somerset police earlier today. This man, a chief constable, recently plunged into a river to rescue a driver who had had an accident, because that is the level of service and of commitment that we get from a constable. It is fundamentally different from that of an accredited person.

I have further concerns about these accredited personages. How do we know who is and who is not an accredited person? I said that they should wear a bowler hat, though it occurred to me subsequently that there might be a few wigs going spare because I believe the Supreme Court has given them up. Certain people in the House of Commons have given up wearing wigs too, so perhaps there are a few wigs that could go round to these accredited persons so that we would know who they were as they went about their duties—fine full-bottomed wigs in 18th-century fashion. But perhaps in the 21st century we should be more modern and it should be the bowler hat, which is perhaps a better symbol nowadays of authority than the full-bottomed wig.

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

Hear, hear.

[Jacob Rees-Mogg]

I am grateful for support from Opposition Members.

What we currently have—Westminster city council did this with its parking attendants—are some desperately scruffy tatterdemalions who wander around as accredited persons. They are parking meter attendants and they look as though they have been dragged through a hedge backwards. Their uniforms are anoraky things, not the sort of thing that an officer of the Crown would ever be seen wearing—the sort of thing that could be worn by anybody. Who knows who may come up to us and say, “I am an accredited person. You are fined £10. Cash only. Thank you very much.”

As we go about our lawful business, are we to be shocked and appalled by the attempts to extort money from us that come from accredited persons who are accredited only by themselves, because they have no fixed uniform, no set outfit, no clarity of purpose in what they are doing? I am very much with my hon. Friend in getting rid of all the references to accredited personages under section 47 of the Police Reform Act 2002 and any form of accrediting of these personages until we settle exactly who they are and whether they should be officers of the Crown and constables.

Let us move on to clause 4. I am so pleased that the Opposition Benches are almost entirely empty, with only two notable and most honourable exceptions, as we discuss the abolition of clause 4. I know it is a matter of great sensitivity to Opposition Members for historic reasons, but they may have been a bit confused today. This is not the famous clause IV; this is another one. It relates to the power to require a name and address.

I know that sometimes I bore the House with historical examples, but on this occasion I thought that I would go back to Odysseus. In order to escape from Polyphemus the Cyclops, Odysseus, when asked his name, replied “Nobody” and he got away. Do hon. Members think that there should have been an accredited person sitting by the Cyclops to tell Odysseus, “Look here, that won’t do at all. You’re fined £1,000 for saying your name is Nobody”?

[Chris Ruane]

He would have eaten him.

[Jacob Rees-Mogg]

Indeed, that is what he was trying to do. He wanted him for his dinner. It seems to me that sometimes local councils wish to take their dinner off our plates through the fines they want to levy. Odysseus would have been caught out by that and prevented from escaping with his men, so there are circumstances in which one must be able not to give one’s name and address because doing so might not be in one’s best interests. Of course, Odysseus, in his hubris, called out his real name as he left. The Cyclops, who was blinded by then, screamed out, and his father, Poseidon, heard it and made Odysseus’s trip home that much harder. When a person’s name gets out into the public presses, things can become very difficult for them. I maintain the ancient right of Greeks, among others, not to give their name and address when asked.

I will appeal to another source of history: P.G. Wodehouse. Many Members will remember that Bertie Wooster, when arrested for pinching a policeman’s helmet on boat race night—I think wines had been taken—gave a false name when arrested. I cannot remember what name he gave, but I think he said that he lived in Acacia avenue. It might be a good address to give if you are ever caught doing things you should not do. There was no additional fine for giving a false name and Bertie Wooster paid the fine handed down at the magistrates court in London—five guineas, which was a lot of money in those days—but got away with giving a false name. There is a great tradition, from Odysseus to Bertie Wooster, of being allowed to hide one’s name from people who do not necessarily have the full authority to request it.

There are serious points within this as well. One may think that it is all frivolity and ancient history, but it is not. It is all about our ancient civil liberties. Until an individual has been shown to have done something that is wrong enough to be arrested, the state has no right to know who they are. As I go about my lawful business, the state does not have the right to stop me and ask me to prove my identity or address. Only if I have committed a crime can the state intervene.

We come to the question of why this should be done by people other than police officers. The argument is always one of necessity or triviality, meaning that the crime is so unimportant that the police will not want to be bothered with it. If the police do not want to be bothered with it, and if it is not worth the time of the magistrates court to deal with it, is it really worth punishing someone for it in the first place? That is where the clause that my hon. Friend the Member for Christchurch proposes removing is so fundamentally wrong. It takes something that is trivial, gives a power to someone who is not an officer of the Crown and then promotes it to a high offence for which one can be fined £1,000. It is entirely disproportional to the initial activity that has led to the official being involved with the otherwise law-abiding subject.

I think that the point my hon. Friend the Member for Shipley (Philip Davies) made is profoundly important, although I was a little worried about the impression he gave that everyone who came down from Shipley was likely to commit an offence when they arrived in central London—perhaps the excitement of the bright lights gets to them. I can assure the House that when people from North East Somerset come to London they are as law abiding here as they are in North East Somerset, which I am glad to say has one of the lowest rates of crime in the whole United Kingdom. It is unfair, unreasonable and unjust to have different rules governing what one is supposed to say to unnamed, unknown, unspecified and unclear public officials here, in Shipley, in North East Somerset, in Scotland or in Northern Ireland. We need a clear law so that people understand whether they are in danger of committing a crime and know what their rights, liberties and entitlements are.

Some can argue, “Well, London’s busy”, but we all know that. If it is busy, it has more police. Rather shockingly, there are more police in London than there are in Avon and Somerset. One would have thought that we should have more police to keep crime even lower, but there is a general adjustment for the reality that London has serious problems that are different from those across the rest of the country. It has the level of expenditure that ensures that it can deal with these issues without having special laws and situations.

15:15

At this point I will diverge from my hon. Friend the Member for Christchurch, because I think that, other than his amendment that proposes to get rid of clause 4 altogether, his other consequential amendments are unsatisfactory. They still leave the right of a police community support officer to ask for a name and address, which I would not be in favour of. If this consideration comes to a vote, I will certainly vote against any amendment other than the complete removal of the clause.

Let me move on to the Royal Mail and the Postage Act. This is a rather embarrassing bit of the Bill, because it refers to sex establishments, and we do not like talking about those in polite society, but on this occasion it is necessary to do so. It seems to me that there is a wonderful naivety in the Bill and a suggestion that the Royal Mail is as good as it was in the days of Trollope, when a letter could be posted before lunch, would arrive in the early afternoon and that one could then reply and correspondence goes backwards and forwards perfectly. Sadly, that is not how it is anymore.

I happen to live on a street in London that has a relatively frequent name and so receive quite a lot of post for a branch of the Hong Kong and Shanghai Banking Corporation, which is on a street of the same name south of the river. Occasionally I receive coins in the mail which people wish to deposit in their bank accounts. As I am sure you realise, Mr Deputy Speaker, I hastily pass these on to a branch of the Hong Kong and Shanghai Banking Corporation so that they can be credited to the right person’s account. I use the example to remind hon. Members of the difficulties of relying on the ordinary post. The first-class post might or might not get there the next day, and the second-class post will get there before Christmas, so long as it is posted in the new year. The Bill does not even establish that it should be the first-class post. That means that the people running these dodgy establishments—I must confess that I have little sympathy for them—will be deprived of a right of justice, which I think is a mistake.

The important thing about our ancient liberties and about justice is that we should apply it to people we slightly disapprove of and think are a little beneath the salt just as much as we do to those we think are good, honest fellows. I think that that should apply to those who run sex clubs. They are just as entitled to receive a summons, notification or a missive from the council in way that means we can be certain it has arrived, by registered post, as someone involved in more salubrious activities. I must confess that it is a shame that the Post Office is not in the state it was in the days of her late Majesty Queen Victoria, but there we are—O tempora, o mores, as I am sure I have said in the House before and will no doubt at some future date say again, possibly on a Friday morning.

I was glad to hear that there was a thought that clause 18 might be withdrawn, but it seems to have been put back again, so I think that I am still entitled to speak in favour of the amendment that would abolish the clause that has been taken out and put back in again—it sounds a little like a soft-shoe shuffle or some such dance.

[Mike Freer]

Having reflected on the kind offer made by my hon. Friend the Member for Christchurch (Mr Chope), we are now happy to accept amendments 5, 8, 10 to 12, 14 and 35 to 39. I hope that that is of help to my hon. Friend.

[Jacob Rees-Mogg]

That is extremely helpful. Indeed, it is both encouraging and worrying: it is encouraging in one sense, because it shows the generosity—the parliamentary spirit—of my hon. Friend, and that is extraordinarily welcome, but it is slightly worrying, given the inconsistency of the Bill. Should we really be negotiating with a group of councils—after we have been debating some of the amendments for little more than an hour—what they will and will not accept? I am not sure that the dignity of Parliament—the House of Commons, this honourable House—is properly and justly reflected by bandying about amendments in that way, so I had better, just in case clause 18 changes again, which would concern me, say a few words about it and the obstruction of an authorised officer.

[Mr Chope]

I am not in any way churlish about the generosity of my hon. Friend the Member for Finchley and Golders Green (Mike Freer) in accepting so many of my amendments. It is right for us to put on the record that he is in charge of the Bill and of taking it through this place; it is nothing to do with officials. He makes the decisions, and the decision that he has made is an excellent one.

[Jacob Rees-Mogg]

Quite right. How could I fail to agree? I hope that, when my hon. Friend the Member for Finchley and Golders Green comes to the decision of withdrawing the whole Bill, we will welcome that decision even more. But just—just—in case it comes back at some later stage, let us look at it briefly and in passing, because we come back to the same problem of the authorised officer not being a constable.

Who is this authorised officer? What is an obstruction? What is an intentional obstruction? What if you, Mr Deputy Speaker, fall over in front of him and he trips over you? Is that an obstruction, or do you have to be more aggressive? What happens if you see him coming but he is not in his uniform—you may not know it is him—and you scarper? Is that an obstruction of him in his duties because you are not there and, therefore, he cannot catch you, whereas if you were there he could catch you? That seems to me, arguably, an obstruction, even an intentional one, because you had to run away to be away from the person who was trying to catch you—because if you had not decided to run away, you would still be there, and then he would have caught you. So if you follow the logic of what I am saying, Mr Deputy Speaker—and if you do follow it, you are doing jolly well—you will see that the clause really ought to be removed and should never have been in the Bill in the first place.

Again, the fines really do seem excessive, and I go back to the point that I was making about the traffic wardens in the city of Westminster, who were put in uniforms that any civilised fellow would have been ashamed to be seen dead in. They were the most scruffy things that really did make the wardens look as if they were vagrants, and I should have thought that most people would scarper if they saw somebody like that coming after them, particularly if they were bringing out a book of fines. One would think, “I’m getting out of his way pretty sharpish, because I don’t know really who he is and I don’t know why he’s got his fines book out, because I don’t think I have done anything wrong.” If we are going to authorise those sorts of people, many of us might obstruct them and say, “Who the Dickens do you think you are?” or words to that effect.

That gives me the opportunity to answer the valid point, made by my hon. Friend the Member for Finchley and Golders Green, that if one is innocent one has nothing to fear. If only it worked like that. Those of us who have contested parking tickets over the years—when we have done absolutely nothing wrong but the machine has broken or the person coming round has misread his own figures and all that stuff—have found that when we appeal we get off. It happens to those of us who are innocent again and again. I was even stopped under one of those ludicrous terrorist Acts that the previous Government passed—going about my lawful business.

[Chris Ruane]

You look like one!

[Jacob Rees-Mogg]

The hon. Gentleman suggests that I look like one. If I look like one, there is not a lot of hope for the rest of you, I have to say.

Therefore, this idea that those of us who are innocent have absolutely nothing to fear at all and can go about our business safely, because it will not be us, is the wrong line to take. It is crucial to defend the liberties of those we dislike and disapprove of, as well as of those we like and approve of, and that is the essence of my objection to much of the Bill but, in particular, to clause 18.

[Mr Chope]

What my hon. Friend says is reinforced by the fact that almost everybody who goes to a parking tribunal and appeals is successful, but very many people do not realise that they have such a right of appeal and, therefore, pay reluctantly and, probably, when they should not.

[Jacob Rees-Mogg]

My hon. Friend is, as always, absolutely spot on, and I should advise anybody in the Chamber today or listening outside to appeal if they get a parking ticket, because it is often wrong and unfair and being issued just as a money-grabbing exercise. Westminster city council is now conducting such an exercise by extending parking charges to midnight, and that is a pretty awful thing to be doing—[Interruption]—but not, Mr Deputy Speaker, as I see you, panther-like, waiting to pounce on an irrelevant comment, part of the amendments under discussion.

So I turn to clause 20, the last measure related to the amendments under consideration, and agree again with my hon. Friend the Member for Christchurch that it is drawn far too widely. It has to be the people at the top who are responsible, but the clause refers to

“a manager, secretary or other similar officer of the body corporate”,

so I am a little worried that the cleaning lady is going to be nicked by some bod coming round in unrecognisable garb, whom we do not really know, saying, “We’ll have a few quid off you.” The measure is going to be a swindler’s charter if it goes through, because people will pretend that they are these authorised officers and sneak up on us and try to get money out of us for doing something that we should not, saying, “Well, it does catch you because you are an ‘other similar officer’. I am an ‘authorised officer’, you’re an ‘other similar officer’ and, therefore, we’ll take a fine off you.”

To conclude my relatively brief remarks—though it would be possible to go on and on about this Bill, so many are its flaws and faults, so good are the amendments proposed by my hon. Friend and so wise was he to bring them forward to try, as I said at the very beginning, to make a silk purse out a sow’s ear—I am afraid to say, after all is said and done, that it is still the meat of pigs.

[Philip Davies]

It is always a trial to follow my hon. Friend the Member for North East Somerset (Jacob Rees-Mogg), because, as I am sure we all agree, we could happily sit here all afternoon and listen to him, so wise is his counsel and so entertaining is his delivery. I am afraid that I cannot match it, but I, too, congratulate my hon. Friend the Member for Christchurch (Mr Chope) on tabling the amendments, and because today appears to have been a red letter day for him. Such was the speed at which our hon. Friend the Member for Finchley and Golders Green (Mike Freer) rattled through the amendments which have now been accepted, that I struggled to keep up with them all, so my comments will be based on my understanding of the current situation, and I am sure that my hon. Friend will correct me if I am wrong at any point.

I certainly support the thrust of what my hon. Friend the Member for North East Somerset said about the amendments, and particularly about the position of accredited persons. My hon. Friend the Member for Finchley and Golders Green made the point that such council officials and officers are reasonable people who will use the powers only when necessary and sparingly, that they would not be used willy-nilly, and that that was his experience of council officials.

My hon. Friend talked to me about my experience of my local police when investigating what might be considered petty or minor crime, and my experience of the police in Shipley is, as it happens, very good—but he must not only have had good experiences of council officials and officers, but also have come across the rather petty council officer who is a stickler for something and does not use any discretion or common sense.

I am sure that we have all come across those people. My hon. Friend the Member for North East Somerset referred to traffic wardens who wait for the clock to tick down before they put their £70 ticket on a vehicle, and there are also those who measure up to see whether one inch of a car is parked on a double yellow line, even though the vast bulk of the car is well within the parking space. I am sure that we have all had experiences of these things.

It is completely unacceptable to give that kind of person additional powers to go about and terrorise what we would largely call law-abiding members of the public. In my hon. Friend’s part of the world there may well be very reasonable people who use their powers very sparingly. However, the rules would apply not only to the council officials whom he has in mind, and not only to the council officials in place at the moment, all of whom may be very reasonable people, but to council officials in future—and who knows what kind of people we may have running some of our local authorities in future? We should not be giving people all these powers just because the people we know at the moment seem to be okay. We have to bear in mind how they may be used, or abused, in future.

15:30

Amendment 9, which is one of the few amendments that my hon. Friend the Member for Finchley and Golders Green is not accepting, is about the power to require names and addresses. That is a completely unacceptable aspect of the Bill. He said that that power would be exercised only where council officials believed that an offence was being committed. I have a problem with that, because the definition of when somebody believes that an offence is being committed is fairly loose. In a situation where there was no real reason for anybody to think that an offence was being committed, but one of these officials merely stated that they did believe that an offence was being committed, would that be good enough for them then to exercise the power granted in the Bill? Where is the check on whether they were right in believing that an offence had been, or was about to be, committed? By allowing them to use these powers in such circumstances we are, in effect, allowing them to use them whenever and wherever they like. That is totally unacceptable.

I come back to the point that I made briefly in an earlier intervention. Lots of my constituents come down from Shipley to London. They may not come down very often, perhaps only every now and then, but they know that they do not have to give their name and address to a council official when it is requested of them. If a council officer from Bradford city council demands to know their name and address, my constituents know that they do not have to tell him, and they can tell him to go forth and multiply. When my constituents come down to London on their day trip, or for a week’s holiday, or to visit the theatre, or whatever it may be, and a council official in Westminster says to them, “You must give me your name and address,” they would be perfectly reasonably entitled to expect to be able to say to him, “Go forth and multiply. I know I can tell my council official in Bradford to go forth and multiply, so there’s no reason why I shouldn’t be able to tell a Westminster city council official the same thing.”

It is totally intolerable, unacceptable and unjust that my constituents in that situation would be committing an offence and liable to pay a fine. How are they supposed to know? Many of my constituents are avid watchers of the Parliament Channel; they want to know what is going on and like to be very well informed about the political debate. However, are we really expecting them to be fully aware, having looked it up before they came down on their trip to London, of the powers of Westminster city council officials, on the off-chance that they may have been given a power that council officials in Bradford have not been given?

It is complete nonsense to think that that could be acceptable in this country. This is not just a matter of minor interest; we are talking about our fundamental individual freedoms, and surely those apply equally right across the United Kingdom. I am a believer in localism, but surely we cannot farm out our fundamental freedoms to the principle of localism and allow every local authority to decide how illiberal it wants to be in its area. That is unacceptable. It is for this House to stand up against that kind of assault on our individual freedoms.

I am disappointed that my hon. Friend the Member for Finchley and Golders Green said that he would not accept amendment 9, which would delete clause 4. Unlike my hon. Friend the Member for Christchurch, I am not an expert in parliamentary procedure, so I do not know whether we can put any of the amendments to a vote. However, as the promoter is now prepared to accept amendment 5, the lead amendment, I hope that my hon. Friend the Member for Christchurch will say that he wishes to press amendment 9 to a Division, because we are talking about a fundamental freedom.

I hope that you, Madam Deputy Speaker, will be minded to allow a Division on that amendment if it is in order, because it is the most important amendment in the group. This is something that everybody in this House should be concerned about, because it could affect all our constituents. This might be the London Local Authorities Bill, but as so many of our constituents come down to London, it could affect any of our constituents.

[Mr Chope]

I hope that we will have the opportunity to test the opinion of the House on amendment 9, because most of the debate has centred on the powers under clause 4 to require names and addresses, and the penalties associated with the refusal to provide them. My hon. Friend is addressing the same issue, which is one of the most fundamental civil liberties issues in the Bill.

[Philip Davies]

I am grateful to my hon. Friend. I said earlier that this would be a red letter day for him, as so many of his amendments are being accepted. I am beginning to think that it is a red letter day for me too, because I appear to have persuaded him that amendment 9 is the most important amendment to put to a Division. I fear that I must now rely on you, Madam Deputy Speaker, to complete my red letter day, which would be a rarity for me in this House.

I think that I am right in saying that the sponsor is minded to accept amendments 35 to 39, the final amendments that my hon. Friend the Member for Christchurch has tabled to the Bill. In case I have got that wrong, I want to touch on clause 18 and amendment 35, which relates to it. The clause talks about

“Any person who intentionally obstructs any authorised officer”.

[Mike Freer]

I am happy to reconfirm that I have accepted amendments 35 to 39.

[Philip Davies]

I am grateful to my hon. Friend for clearing that up, because I had a great deal of concern about what constituted an intentional obstruction of an authorised officer and what constituted an unintentional obstruction. As he has made it clear that he will accept amendment 35, which will delete clause 18, I do not propose to waste the House’s time by going through it.

I will mention amendment 21, because it appears that my hon. Friend the Member for Finchley and Golders Green has not accepted it. It relates to clause 8 and the issue of postage. Given that he has been so generous in accepting the amendments tabled by my hon. Friend the Member for Christchurch, I am surprised that my hon. Friend the Member for Finchley and Golders Green has not accepted amendment 21. I will give it a whirl and try to persuade him that he should accept that amendment as well. It seems not only to be harmless, but to be in the best interests of the local authorities.

Clause 8 attempts to strike out the requirement that the council send its enforcement notices

“in a prepaid registered letter, or by the recorded delivery service”,

and to substitute for it a requirement to send them “by post”. Amendment 21 would strike out that change and ensure that local authorities had to send notices by prepaid registered letter or the recorded delivery service. It is perfectly reasonable that councils should do that, for a number of reasons. These are important matters, as I am sure my hon. Friend the Member for Finchley and Golders Green will accept. That is why the Bill tries to address them. If they are such important matters, surely the local authority should have to reflect that importance by sending notices out by recorded delivery or registered post.

I wonder how many of these infringements my hon. Friend the Member for Finchley and Golders Green expects to occur, given that clause 8 relates to the City of Westminster Act 1996, which makes provision about the closure of unlawful sex establishments.

[Mike Freer]

I cannot give my hon. Friend a particular number, but I can try to help him on the issue of postage. My recollection is that county court judgments, council tax arrears notices or bailiff action, penalty charge notices and speeding tickets are not issued by registered post. They are all issued through the Royal Mail. If it is good enough for the police or the courts, surely it is good enough for councils.

[Philip Davies]

I am grateful to my hon. Friend, who makes a fair point, but of course the big difference between the cases that he mentions and this one is that there is quite a large volume of those notices to go out in the post, so there is a substantial cost saving to the taxpayer in having them sent out by post rather than registered post or recorded delivery.

That brings me back to my question about how many notices my hon. Friend expects to be sent out under the provisions of the 1996 Act about the closure of unlawful sex establishments. I cannot for the life of me believe that the local authority will send out hundreds of thousands of them in any given year. Surely we are talking about a handful at the most—maybe, on the generous side, 15 or 20. I cannot imagine it could possibly be any more than that. So what cost saving would there be? It seems to me that the local authority might save itself £50 or £60 if the change were made, and I suspect that that is a very generous estimate. I am all for local authorities saving money, but surely there are far bigger fish to fry in that context.

I believe that the change would not save the local authority money but end up costing it more. When somebody is sent something simply through the post rather than by registered post or recorded delivery, we do not know whether it has been delivered. When something is sent by registered post or recorded delivery we do know that, because it can be traced back through the Royal Mail. Nobody can deny that they have received the letter. If it is sent out by ordinary post, who is to know whether it has been received by the intended recipient? It may well have been, but it may not.

If the intended recipient claimed, rightly or wrongly, that they had not received it, and the council intended to pursue an enforcement notice on the back of the letter that they sent out, where would the local authority stand? Would it be able to pursue an enforcement notice if the recipient said, “Well, you may have sent it by post, but I never received it, and you’ve got no evidence at all to say that I did”? Might that be contested in the courts? Might a magistrates court or district judge say, “Well, it’s not beyond the realms of possibility that this person did not receive the letter, so we’re not allowing this enforcement notice to go ahead until we can be sure that they’ve received the official documentation from the local authority”? To risk going down that road to save a maximum of £50 or £60 a year, or whatever, seems to me unbelievably ridiculous. I suspect that the change would cost local authorities more in the long run. As my hon. Friend has been so generous in accepting other amendments, I really do not see why he is not prepared to accept one that seems so very small.

[Mr Chope]

My hon. Friend is making a powerful case against clause 8(3) and (4). Does he accept that one problem with the proposed change is that it could well result in a lot of injustice? People could find that they faced the closure of an establishment alleged by the council to be an unlawful sex establishment, although they had not received the notice because it had been sent by ordinary post.

15:45

[Philip Davies]

I was describing people who would simply pretend that they had not received the notice because there would be no trace of it, but my hon. Friend is right that there would be another group—those who genuinely did not receive the notice. What happens in that situation? Does the local authority simply send people to close down an establishment even though the proprietor has no knowledge that that is about to happen? Could that happen when the proprietor has lots of customers inside their establishment, which would cause a great deal of embarrassment for them and damage any legitimate businesses they might have?

That is a totally unsatisfactory state of affairs. If someone is having their business closed by the local authority and if their establishment is deemed to be unlawful, surely the least they can expect is a guarantee that they will receive the notice that makes that clear. Surely it is this House’s responsibility to defend people’s freedoms in this country, and to ensure that local authorities have taken every reasonable step to ensure that somebody knows about an enforcement that is about to take place.

We should not allow there to be doubt as to whether someone has or has not received a notice. I am sure that Royal Mail does a fantastic job, but even it would not guarantee that every letter reaches its intended recipient. I ask my hon. Friend the Member for Finchley and Golders Green to think again on amendment 21 and also to think of the upside and downside for local authorities of defying it. I hope that he will reflect on that and decide, in the spirit of consensus that he has adopted, to accept it.

I congratulate my hon. Friend the Member for Christchurch on his diligence and hard work. Such things are very important to people. We see from the lack of numbers in the Chamber that other hon. Members have probably not even bothered to look at the provisions in the Bill, whereas he has gone through them with a fine-tooth comb and found where our individual freedoms are being put at risk by unnecessary local council bureaucracy and officialdom—and sometimes even worse.

I commend my hon. Friend the Member for Christchurch for tabling the amendments, and I am delighted that my hon. Friend the Member for Finchley and Golders Green has accepted them. I do not know whether he has done so tactically to oil the wheels of the Bill or whether he has been persuaded by the case made by my hon. Friend the Member for Christchurch. I suspect the latter. My hon. Friend the Member for Finchley and Golders Green is a reasonable man who listens to the arguments, and I genuinely believe that he has been persuaded by my hon. Friend the Member for Christchurch.

I hope my hon. Friend the Member for Finchley and Golders Green has been persuaded of the merits of amendment 21 and that he will reflect on it while there is still time. I suspect that he will not change his mind on amendment 9, which is why I hope that my hon. Friend the Member for Christchurch will find a way to press it to a Division, and that you, Madam Deputy Speaker, will find a way to accept that. I can assure my hon. Friend that if that happens I will support him in the Division Lobby, because I want to support and defend the fundamental freedoms of people in this country, not least those of people from my constituency who visit London.

[Chris Williamson (Derby North) (Lab)]

I very much concur with the contribution made by the hon. Member for Finchley and Golders Green (Mike Freer). Far from there being a lack of support for the Bill from London Members, I remind hon. Members that on Second Reading, there was considerable representation on both sides of the Chamber and hon. Members spoke with enthusiasm for the provisions. It is very unfair for hon. Members today to suggest that the lack of Members in the Chamber justifies their stance.

[Mr Chope]

The hon. Gentleman will know that since the Bill was debated on Second Reading, the Opposed Bill Committee has deleted quite a lot of its contents. Given, as he says, that the Bill was supported so enthusiastically on Second Reading, is it not possible that the reason why so few people are interested now is that so much of it has been deleted?

[Chris Williamson]

I suspect that that might be part of the explanation. I regret that some of the clauses were removed in Committee, particularly the ones relating to food hygiene—the scores on the door proposals—and to houses in multiple occupation. Having said that, the Bill is still worthy of support from this House. If these measures are subject to a Division, I urge hon. Members to do the right thing and support the Bill.

The hon. Members for Christchurch (Mr Chope), for North East Somerset (Jacob Rees-Mogg) and for Shipley (Philip Davies) have subjected us to a range of fairly spurious and absurd criticisms of the Bill. They have enjoyed poking fun at local authorities, which is an indication of their lack of support for local government and what local authorities do in our communities. The Opposition take the view that local authorities are very much a force for good. They are a form of government that is close to the people whom they serve. Elected members at a local level—local councillors—do an excellent job in representing and standing up for their constituents. This Bill has the support of all 33 local councils across London of every political persuasion, so it has cross-party support. It gives local authorities in London the ability to stand up for their communities and the residents who elect them.

[Philip Davies]

The hon. Gentleman seems to be advocating a curious line of argument. Is he really suggesting that in order to demonstrate our support for local authorities, we have, by definition, to agree to give them the same powers that police officers have? To suggest that that is the only way to support them is surely absurd.

[Chris Williamson]

It is not absurd. It is the hon. Gentleman who has been making a number of absurd criticisms. The point is that this Bill has cross-party support; all 33 London councils support the powers that this Bill would give to them to stand up for their communities. There are very real problems that this Bill will help to address.

The hon. Gentleman talked about freedom. It seems to me that he wants to stand up for the freedom of an individual to act in an antisocial way. What about the silent majority of decent, law-abiding citizens whose neighbourhoods are often blighted by the activities of a small minority? If this Bill is passed, it will give local authorities, where it is appropriate and necessary, an ability to address those concerns of local residents. At the moment, local authorities are in many ways powerless to deal with the problems that confront them. It is important that this House gives local authorities the tools that they need to do their job.

Let us be clear about this. One hon. Member—I cannot remember whether it was the hon. Member for Christchurch, the hon. Member for North East Somerset or the hon. Member for Shipley—talked about the austere times in which we live. I accept that that is true and that local authorities are being subject to unjustified cuts. The problem is that if these measures are not agreed today and local authorities are not given these new powers, the cost of dealing with the consequences of the sorts of activities that we have been talking about will be that much higher. I cannot believe that the Government Members who oppose the Bill think it a good idea that we should deny local authorities the ability to address more effectively problems that not only blight neighbourhoods and the lives of ordinary people, but cost council tax payers in those local authority areas considerable sums. Surely it is far better to give local authorities the powers to deal with those problems and put in place the deterrent measures provided for in the Bill, which might help to stamp out problems that are a cause of considerable concern.

[Mr Chope]

Does the hon. Gentleman not accept that on issues as fundamental as civil liberties we should have national laws rather than local laws? Is it not incumbent on this House to speak not only on behalf of the residents of London, but on behalf of the people who come to London—the visitors, the people who work in London and those with other interests in London? Is it not our responsibility to look at the big picture, rather than the sectional interest?

[Chris Williamson]

If I may say so, the hon. Gentleman seems to be overstating the civil liberties argument. In my view, this is not an illiberal Bill in any way, shape or form, nor does it impinge on the civil liberties of decent, law-abiding citizens. Surely he can see that it is sensible and proportionate to give local authorities the tools they need to address the genuine concerns of large numbers of their constituents about what are significant problems. Surely he can see that if we do not give local authorities the tools to do that job, the whole political process is brought into disrepute. When constituents approach their Member of Parliament or their councillors to ask for assistance in finding a resolution to the sorts of issues that this Bill would deal with, and find that they are unable to assist them, people lose faith in the political process. Surely that is a more important issue than some spurious argument about civil liberties.

[Philip Davies]

I am amazed that the hon. Gentleman thinks that civil liberties are a spurious issue, although that gives an insight into what the Labour party believes in these days. How does he expect his constituents in Derby to know that although they do not have to give their names and addresses to a council official in Derby, they do have to give them to a council official in London? Is he going to go around personally communicating that message to every one of his constituents, or are they expected to know by some remote control device?

[Chris Williamson]

The hon. Gentleman is putting words into my mouth. I did not say that civil liberties were a “spurious issue”. My point is that he and his hon. Friends are using the civil liberties argument in a spurious way.

As for my constituents coming down to London, if the hon. Gentleman reads the relevant clause in the Bill, he will see that it deals with the anxiety—if it is a genuine anxiety—that he has expressed. The Bill is clear that a designated individual from the council would have to demonstrate their authorisation to seek the information that they were requesting, so that issue is dealt with. However, the vast majority of people coming from Derby to visit our great capital would have no difficulty with council officers as a result of the Bill. This Bill is about ensuring that local authorities can stand up for the silent majority—in other words, the vast majority—of those living in London, who want local authorities to be able to respond effectively to local residents’ concerns about a range of issues that the Bill would go some way towards addressing.

[Mr Chope]

To dwell a moment more on the issue of Derby, is the hon. Gentleman content that under the Bill a council officer or accredited person from London could go to one of his Derby constituents and serve a fixed penalty notice on him that had resulted from a parking offence in London, whereas a similar official from Derby council could not go to the same resident to serve a fixed penalty notice in relation to an offence committed in Derby?

16:00

[Chris Williamson]

I do not have a major problem with that. I think that the circumstances of London are, to be fair, unique. It is a more populated—I will not say overpopulated—and busy city with unique problems and unique issues. That means that different measures and powers might be more appropriate in London than they might be, say, in Derby. As I say, I have no difficulty at all with that, and for the reasons I have outlined, I support the hon. Member for Finchley and Golders Green. The Opposition are quite content with the Bill’s provisions.

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

I rise to speak very briefly. First, I declare an interest in that my wife works for a London local authority. Secondly, I support the Bill. It is entirely appropriate for Parliament to support giving greater powers to local authorities where necessary. We should not be scared of there being a patchwork quilt of different powers at different levels in different places. I am sure that we and our constituents can cope with that. The portrayal by some Members of people who work in local authorities as being either little dictators or scruffy bureaucrats is extremely unfair. I am sure that some of those Members must be hoping that their constituents, many of whom work for local authorities, will not read Hansard too closely; if they do, they will see the views of their MPs contained therein.

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

I am grateful that I have been given the opportunity to sit through this almost unique debate. I hope to participate fairly briefly, as Members still wish to consider other aspects of the Bill in the time available.

It is fair to say that this is an unusual type of Bill and this is probably an even rarer stage of debate on it. I am grateful to all Members who have participated and hope they will forgive me if I do not follow them down all the highways and byways through which the debate has ranged. I shall say a few words factually about the Government’s stance and position on the Bill as we now find it, and I shall cover a little of the history.

I believe this Bill started out before the last general election. It is, of course, a private Bill, so a different set of procedures apply. It has been changed a great deal in the course of its passage. It is worth remembering that it is more than a year since the Bill was last debated in this House and there have been some significant changes. Because it is an unusual form of legislation, it is right that the appropriate level of scrutiny is given to it. I appreciate the spirit in which Members of all parties have approached the debate.

The changes take on board to some extent the concerns raised by the Government at an earlier stage. I hope hon. Members will recollect—I looked back and checked—that my concerns focused in particular on measures that potentially placed undue burdens on businesses, business owners and entrepreneurs or that otherwise did not sit comfortably with Government policies.

In fairness, the principal elements that concerned the Government on Second Reading have been removed, and I thank the Bill’s supporters for their flexibility and willingness to compromise. As is normal in the case of such Bills, all the Departments that might be affected have been consulted, and no concern has been expressed about direct conflict with Government policy. As far as can be ascertained, it has historically been the convention for Governments to take a neutral position on private Bills, and that is what the Government intend to do in this instance. The Bill has been scrutinised by the House, and it is therefore appropriate for the Government to defer to the conclusions that Members reach on the basis of what we have heard so far, and of what we may yet hear before the day is out.

[Mr Chope]

It seems that the Government are now saying that they are taking a neutral position. However, on Second Reading they expressed something other than neutrality: they expressed opposition to certain provisions. Can I tease out from my hon. Friend a little more about how the Government decide when they will be neutral, when they will be opposed, and when they will support a private Bill?

[Robert Neill]

Because there is comparatively little of what could almost be described as jurisprudence in this regard, we must depend to some extent on precedent, while also applying a measure of practicality on a case-by-case basis.

Given that background, I do not think it appropriate to elaborate further at this stage.

[Mr Chope]

We have had an excellent debate. I thank all who have participated, including those who have made telling interventions. The right hon. Member for Carshalton and Wallington (Tom Brake) was not present for much of the debate, but I am grateful to him for his participation, although he did not go into much detail. I am also grateful to my hon. Friend the Member for Finchley and Golders Green (Mike Freer) for listening to the arguments and, as a result, giving notice that, on behalf of the promoters, he will accept a fair number of my amendments.

I thank my hon. Friends the Members for North East Somerset (Jacob Rees-Mogg) and for Shipley (Philip Davies) for supporting the amendments, thereby contributing significantly to the decision of my hon. Friend the Member for Finchley and Golders Green to accept so many of them. They go some way towards improving some of the clauses in the Bill, but, as was pointed out by my hon. Friend the Member for North East Somerset, they do not do anything other than ameliorate the Bill. They do not address some of the most fundamental issues.

My hon. Friend the Member for North East Somerset spoke for some time about clause 4, which contains the power to require names and addresses. He cited a number of historical precedents. I thought the Homeric example was the most telling, but the reference to P. G. Wodehouse was also very pertinent. However, underlying his argument, which he made in his inimitable and witty style, were some serious issues that touched on the reason why we have not had revolutions in the United Kingdom for centuries. We have always accepted the primary importance of allowing citizens their liberties, and we take away those liberties only if there is a strong case for so doing. Recently, however, there has been a gradual erosion of the right to which he referred—the right of a person not to tell anybody their name, address and identity unless they have committed, or are thought to be committing, a criminal offence, and even then only if that information is demanded by a police constable.

That right was jealously guarded when the House considered the legislation relating to police community support officers. The House realised that PCSOs might need to ask the identity of individuals who they thought were committing criminal offences. Even then, however, the House did not allow PCSOs to have the power of arrest. Instead, it said that PCSOs could ask someone who refused to give their name and address or whom they suspected of giving an inaccurate name and address to stay behind for up to half an hour, during which time a police constable could come along and effect the necessary arrest.

Clause 4 would significantly extend that power to borough councils and police community support officers, although as a result of the amendments that my hon. Friend the Member for Finchley and Golders Green has accepted, clause 4 will no longer apply to accredited persons. Obviously we are grateful for that, but we think that the power in clause 4 to require names and address, coupled with the power effectively to criminalise a person and subject them to a maximum £1,000 fine for refusing to supply that information, is wrong in principle.

It is all the more wrong that the law should apply in one part of the country and not across the country as a whole. The House should deal with issues of civil liberties on a national basis, rather than on a piecemeal basis. Nobody has made the case for why borough councils or PCSOs in London should have greater powers to obtain names and addresses and to impose penalties if they are not supplied than powers elsewhere in the country. At the heart of the provision, therefore, is a problem. It is a misuse of a private Bill to extend powers at the expense of ordinary citizens in London, especially if the same is not being done elsewhere in the country.

The hon. Member for Derby North (Chris Williamson) and the right hon. Member for Carshalton and Wallington said, quite reasonably, that the Bill was supported by the 33 London boroughs, but that is not an end in itself. If this was simply a matter of byelaws, those London boroughs could implement them; but here we are introducing public law and criminal restrictions in London and not elsewhere in the country. It is incumbent upon the House to consider the matter not only from the point of view of a resident of a London borough, but in a national context and from the point of view of people who work in London, visitors and others.

[Philip Davies]

Is that not the crux of the matter? It is no surprise that local authorities are in favour of the provisions. If the House is to provide for hugely extended powers, it is perfectly likely that the bodies getting those increased powers will be in favour of them. Is it not the House’s duty to prevent such bodies from having undue extra powers at the expense of individuals in our constituencies?

[Mr Chope]

My hon. Friend is right, and he made a powerful speech asking why people in Shipley should be dealt with differently from people in London, and why people from Shipley who happen to be visiting London should find they are subject to a different set of laws from those that would apply if they were in their own constituency. We realise that the laws will be different if we visit a foreign country, but we do not expect that to be the case between different parts of England—such as for people from Shipley, Christchurch or even Derby—let alone the rest of the United Kingdom.

16:00

There is a fundamental issue of principle here, and I am disappointed that my hon. Friend the Minister says the Government are neutral on this matter. How can the Government be neutral on an issue of civil liberties that affects the entire country? How can they say, “We are totally relaxed about whether there is an erosion of civil liberties in London but not elsewhere”? It seems to me that the Government ought to have a view on that.

My hon. Friend the Minister says that the jurisprudence is unclear. I impress on him the fact that he, as the Minister, is able to establish precedent from the Dispatch Box. Perhaps he will seize that opportunity, if not on this set of amendments then on subsequent amendments, and thereby set a precedent and establish the future jurisprudence on when the Government are neutral, when they are opposed and when they are in favour of a particular provision of a private Bill.

I must not be too critical of the Minister, however, as he could have expressed the view that he was supportive of the promoters of the Bill in this regard. I must take some solace from the fact that he and the Government are neutral. The message that that sends to Members is that, as private Bill business should be, this is very much a matter of private conscience. It is nothing to do with the Whips. Each Member must make up their own mind as to whether they think it is reasonable that we should extend to London the power to require names and addresses subject to a penalty for failure to give that information as proposed in clause 4, or whether we should say that if we are going to extend that power to local authorities in the future it should be extended across the entire country after a proper debate.

This has been an excellent debate and I thank all those who have participated. The promoters of the Bill have indicated a willingness to accept a number of the amendments, and I seek to have them incorporated into the Bill, if that is the will of the House, but I also wish to test the opinion of the House on amendment 9.

Amendment 5 agreed to.

Amendment 8 made.—(Mr Chope.)

Clause 4

Power to require name and address

Amendment proposed: 9, leave out clause 4—[Mr Chope.]

Question put, That the amendment be made.

16:18

Division 409

Ayes: 57

---

Conservative: 47
Democratic Unionist Party: 6
Liberal Democrat: 2
Plaid Cymru: 1

Noes: 145

---

Labour: 98
Conservative: 26
Liberal Democrat: 17
Plaid Cymru: 1
Independent: 1
Alliance: 1

[Madam Deputy Speaker (Dawn Primarolo)]

With the leave of the House—[Interruption.] I know it is exciting, Mr Percy, being a Teller, but perhaps if Members took their seats it would make the business easier. With the leave of the House we will take amendments 10 to 12 and 14 together.

Amendments made: 10 to 12 and 14.—(Mr Chope.)

Clause 5

Street litter control notices

[Mr Chope]

I beg to move amendment 15.

[Madam Deputy Speaker (Dawn Primarolo)]

With this it will be convenient to consider amendments 16 to 20, 3 and 4.

[Mr Chope]

It is a great pleasure to speak to this group of amendments. The lead amendment would remove clause 5 from the Bill and I tabled it because the clause extends significantly the provisions of the Environmental Protection Act 1990 in relation to street litter. It offends against the principle that we were discussing on the previous group of amendments by making this extension apply merely in Greater London, rather than across the country as a whole. It is implicit in the fact that this is being brought forward in a private Bill that the Government would not support such an extension across the whole country. My argument is that in a unitary state we should have the same laws on street litter control in London as apply in the rest of the country.

The effect of clause 5 is summarised on page 2 of the explanatory memorandum to the Bill, which states:

“Street litter control notices are notices served under section 93 of the Environmental Protection Act 1990. They can be served by the principal litter authority (in London, the borough council) imposing requirements on occupiers of premises with a view to the prevention of accumulations of litter or refuse in and around any street or open land adjacent to any street. Under section 94 of the 1990 Act, the Secretary of State is given power to prescribe the descriptions of commercial or retail premises in respect of which a street litter control notice may be issued, amongst other things.”

The 1990 Act deals with commercial or retail premises. It gives the power to the Secretary of State to prescribe the descriptions of commercial or retail premises—in other words, to limit the application so that it extends not to all commercial or retail premises, but only to some of them. The effect of clause 5 would be to extend the type of premises that the Secretary of State can prescribe under section 94 so that it includes all premises in Greater London, except for what are described as dwellings, which most of us would call houses. This will bring into the scope of the street litter control notice procedures public buildings and other buildings that are not commercial or retail premises.

This sweeping power was brought in to deal with the problem that many of us experience with premises occupied by takeaway food shops. For example, people go into the takeaway food shop, collect their food in a container, then think it best to deposit their container on the public highway or on the pavement after they have consumed its contents, and sometimes before they have consumed all of its contents. That causes a nuisance.

Similarly, where there are retail banking premises with cash tills, people often ask for a receipt, take their money, and as soon as the receipt is issued, they throw it on to the ground. That is the sort of litter nuisance which the existing provisions of the Environmental Protection Act are designed to address.

What has obviously come to the notice of the officers of Westminster city council and other councils in London is that people sometimes hang around in the porches of offices smoking, because they are not allowed to smoke inside the offices. It is said that as a result of that, enormously increased powers are needed under the provisions of clause 5 in order to extend to every single building in London, other than a dwelling, the ability of the council to impose a litter requirement on the occupiers of those premises. That could involve them having to regularly sweep or maintain areas well beyond their own premises, in effect duplicating the role of the public street sweeper.

It seems that this, like so much in the Bill, is a sweeping provision to deal with what is, according to any view, a relatively small issue. If people stand outside a building to smoke and deposit their litter on the street, they are already guilty of an offence that can be enforced, but if the litter falls on private land it is the responsibility of the owner of the land to clear up the detritus and debris. Sensibly, containers are often provided outside buildings so that people can stub out their cigarettes and throw away their fag packets. I am not a smoker, but I know that that is what happens in the designated smoking area on Speaker’s Green, where people working on the premises can put their smoking litter in a receptacle.

Considering the pretext set out in the Bill’s preamble, one wonders why this enormously wide power is being taken. If this is a problem in London, it is obviously not unique to the city and applies in every town and city across the land. Many people think that the councils have a hidden agenda to transfer responsibility for cleaning public highways to adjacent landowners. For example, almost every office on Victoria street could have a litter control notice issued to it, the consequence of which would be that their owners would have collective responsibility for cleaning the pavement along the entire length of the street. That would be true of almost every street in central London, which on the whole are occupied by commercial premises and Government buildings, rather than residential accommodation.

There is a concern that this provision is a sledgehammer to crack a nut. It is far too extensive. Indeed, one of the petitions initially put forward against the Bill noted the objections of the society of theatre managers, which could see that it was effectively another stealth tax on their activities. People leaving the theatre might drop their tickets or cigarette butts, but that is not the fault of the theatre. If those people drop their litter, surely it should be the responsibility of the local authority to collect it as part of its normal street sweeping exercises.

A large number of people are very concerned about Westminster city council’s plans to raise vast sums of additional income by extending on-street parking restrictions until midnight on weekdays and introducing them for the first time on Sundays. The council’s income will increase significantly, yet this provision in the Bill allows the council the opportunity to absolve itself of responsibility for keeping the streets clean and to pass the cost of doing so on to office owners. There is a complete difference between a takeaway food shop, which makes its profits out of giving customers food in packages that they can take out of the shop and dispose of, and an office or public building, where people congregate outside the front door to have a discussion over a cigarette.

16:45

That is the background to clause 5. It is one of the Bill’s provisions that was not really discussed in the opposed Bill Committee, and that is why it is worth discussing it in the House this afternoon. We need to take into account its genuine motives, because the current explanation does not add up. It is implausible and it shows that there is a secret agenda to transfer the responsibility for and cost of street sweeping from local authorities to the adjacent occupiers of premises such as public buildings and offices.

If my hon. Friend the Member for Finchley and Golders Green were to make a compelling case, explaining exactly why those wide-ranging additional powers are needed, the House would take that into account, and amendment 15 gives him the opportunity to do just that.

That brings me to clause 6, and to amendment 16, which would leave the clause out of the Bill. Clause 6 removes the prohibition on turnstiles in public lavatories in London, stating:

“Section 1 of the Public Lavatories (Turnstiles) Act 1963…shall not apply in respect of a public lavatory or public sanitary convenience controlled or managed by a borough council.”

In that context, it is relevant to note that the Bill was presented to the House in November 2007, but that it was not until the following spring that the then Government, of whom you, Madam Deputy Speaker, were a distinguished ministerial member, issued a paper on public conveniences. The paper was introduced by Baroness Andrews and entitled, “Improving Public Access to Better Quality Toilets: A Strategic Guide”. I do not know, Madam Deputy Speaker, whether it ever had your approval as a Treasury Minister, but it extended to many pages and refers to the turnstile provision under discussion. As though that were not enough, the Select Committee on Communities and Local Government then carried out an inquiry into the issue.

That reminds me of when I was a trainee barrister and we had occasion to go down to the Old Bailey and watch some cross-examination. Learned counsel said to the witness, “And what happened next in the lavatory?” and the witness said, “Well, what happened in the toilet was this,” and so it went on, with the witness insisting that the right expression was “toilet” and learned counsel insisting that it was “lavatory”. Anyway, under the erstwhile Deputy Prime Minister, who was in charge at the time I think, the paper was very much about improving public access to better quality “toilets” rather than “lavatories”.

Be that as it may, the Select Committee looked into the issue and concluded that the problem was one of too many turnstiles in public lavatories on private land, citing the difficulties one sees at some railway stations, where people try to get through the turnstile with their luggage, trolley or pushchair and cannot do so. The Committee therefore suggested that a similar prohibition on turnstiles should be extended to private premises, but the Bill before us goes in completely the opposite direction and removes the prohibition on turnstiles in public lavatories on council-owned premises.

If we have to finish these proceedings shortly, I hope that my hon. Friends will have a chance to look in greater detail at the abundant material on the issue, and that when they look at it they will be persuaded—

16:50

Three hours having elapsed since the start of proceedings on the Bill, the business was interrupted (Order, 1 December).

Bill to be further considered on Tuesday 13 December.

Animal Experimentation

Wednesday 7th December 2011 Commons Chamber

Motion made, and Question proposed, That this House do now adjourn.—(Greg Hands.)

16:50

[Mr David Amess (Southend West) (Con)]

Throughout my time in Parliament I have consistently campaigned on animal welfare issues. I do not believe that I have been unreasonable, extreme or silly about those issues, but I have endeavoured to ensure that animals’ interests have been represented in this Chamber. By virtue of a ten-minute rule Bill, together with Lord Houghton of Sowerby and the then Minister, Douglas Hogg, I was fortunate to secure on the statue book the Protection against Cruel Tethering Act 1988. There are many other animal welfare measures regarding pet shops, exotic and endangered species, puppy farming and the like which I have tried to encourage through legislation. In 1986 I served on the Committee that considered the Animals (Scientific Procedures) Bill.

In 1876 Parliament passed the first legislation in any country in the world to control live experiments that might cause pain. The Cruelty to Animals Act 1876 was a response to some horrifying reports about the practice of surgical procedures on live animals without anaesthesia. That Act stood the test of time well, but the 1986 legislation brought it up to date. I well remember the then Minister, David Mellor, doing battle with the former Member of Parliament Harry Cohen. It was a very interesting exchange of views, but I am glad that the measure that ultimately reached the statute book was well appreciated.

The European Union has adopted a new directive on animal testing—Directive 2010/63. I point out to the Minister that the Home Office will be amending the Animals (Scientific Procedures) Act 1986 to comply with the directive. A number of colleagues have already contacted me to say that they are very concerned about this matter. It is true that there will be a public consultation, and I understand that the Home Office is currently analysing responses and putting together a draft proposal that will be sent to Parliament next year. However, my colleagues and I are very concerned about the European directive, simply because we in this country pride ourselves on the way in which we treat animals, and we need to be convinced that all countries in the European Union have the same high standards as we do.

Our country is allegedly a nation of animal lovers. Sadly, words and actions do not always match up. I consider the measure of a civilisation to be how animals are treated. I pay tribute to the many organisations and groups that battle to stop cruelty to animals, helping to generate support and awareness about various issues. As regards the particular matter that I wish to raise with the Minister, I am indebted to Kathy Archibald and Louise Owen, who, among others, have briefed me so well. Indeed, they are probably on the line now, hoping that I can make changes to the speech and get in yet another piece of lobbying.

Writing in Nature Reviews Drug Discovery, David Horrobin answered the question:

“Does the use of animal models of disease take us any closer to understanding human disease?”

His response echoes the concerns that I wish to raise in the House tonight:

“With rare exceptions, the answer to this is likely to be negative.”

The process before clinical drugs come to be tested on a human being should be well understood, but I am not sure that it is. Anyone who hopes to get a new drug on to the market must first put it through a series of tests on various animals. It is that reliance on animals as a final safety screen before products go to clinical trials that concerns me, for that “safety screen” is no such thing. Animal models are not a reliable indicator of how a human being will react to a drug.

My hon. Friend the Member for Stourbridge (Margot James), who has just taken her place, will be glad to hear that I have already raised the European directive that she is concerned about, and that the Minister nodded. I am therefore optimistic that Home Office officials will be working on the advice right now.

The safety of medicines is an issue of increasing concern. Every year, 1 million Britons are hospitalised by prescription medicines. That costs the NHS up to £2 billion a year. The Safety of Medicines Bill, which I introduced earlier this year, is intended to safeguard against this growing problem. I believe that the Bill has widespread support—but then I would say that. However, it has been misrepresented, although not intentionally I am sure, and it has certainly been misunderstood. Although my opposition to cruelty to animals is well documented, it is important to make it absolutely clear that the Bill does not call for animal tests to be replaced per se. It is about determining the best means to ensure the safety of medicines and to protect patients against adverse drug reactions.

It could be argued that the use of animals is ethically and morally wrong. Many people would argue that strongly. However, in this debate the criticism of the use of animals focuses not on the suffering of the animal, which can be quite shocking, but on the fact that animal models are not accurate indicators of human responses. That in turn creates risks for volunteers, patients and sufferers during and after human clinical trials. I believe that there is ample evidence to support the argument that animal models do not function properly in their role.

[Jim Shannon (Strangford) (DUP)]

I do not often disagree with the hon. Gentleman or question him. However, there are many examples of medicines that have been perfected by their use on animals and have saved lives. How will he ensure that that continues to happen, given what he has been setting out? My concern is that there is some goodness in this practice. Let us not lose that.

[Mr Amess]

The hon. Gentleman and I do not disagree on many things, and it would be a shame if we fell out on this issue. I hope to prove by the end of my contribution that there would certainly not be the adverse impact that he fears.

[Chris Williamson (Derby North) (Lab)]

I congratulate the hon. Gentleman on bringing this issue before the House, and I very much support him. I am sure that he is going to come on to this point, but my response to the hon. Member for Strangford (Jim Shannon) would be that in an infamous case, thalidomide was proven safe for use on animals, but we all saw the tragic consequences of that. There has been a lot of publicity about that, but there are many other examples that have not had the same level of publicity. As the hon. Member for Southend West (Mr Amess) pointed out—before the hon. Member for Strangford came into the Chamber, I think—1 million people a year are hospitalised as a result of taking prescription medication. We must consider that problem, and I hope that the Minister will listen to the contribution of the hon. Member for Southend West this evening.

[Mr Amess]

I welcome the support of the hon. Gentleman, whose maiden speech I was privileged to follow. I am going to mention two or three cases that enforce what he says.

There is ample evidence to support the fact that animal models do not function in their role. That is a very important matter for the Home Office to consider. In my time here many Ministers have held the relevant responsibility, and of course those advising Ministers are also very important. I do not expect the Minister to give me a firm yea or nay during the debate, but I hope she will write to me about the points that I make.

Experiments on animals cannot predict the mechanisms of the disease in question, risk factors or potential adverse reactions. According to the US Food and Drug Administration, the world’s largest drug regulator—I hate to keep using America as the example, but it seems to have the latest data—92% of potential new drugs fail in human trials. We cannot just dismiss that, because it is huge number, but no publicity is given to it. The drugs fail either because they do not work on, or are not safe for, humans. I will come later to one famous and disastrous incident. After appearing safe and effective in animal tests, those drugs fail completely.

Communities of senior scientists are very much aware of the dangers of using animals as human indicators. The Safer Medicines Trust, the patient safety charity of senior scientists, including Sir Ian Wilmut, the renowned “father” of Dolly the sheep, has expressed its concern. It is clearly not opposed to animal experimentation per se, but it is concerned for patients and for science in general. Indeed, it has sent open letters to the Prime Minister and the Secretary of State for Health stating that the current system for ensuring the safety of medicines before clinical trials is inadequate and results in harm to volunteers and patients.

These are difficult times, and I know that people are paid to volunteer for trials, but there have been a number of well-documented disastrous consequences. The danger to human beings from the use of animal testing is clear. Even in pre-clinical stages, lives have been lost because the results have misled scientists.

I wonder how many people realise that penicillin stayed on the shelf for more than a decade because the results in the rabbits on which Fleming tested it led him to believe that it would be ineffective in humans. That was quite the wrong outcome—and we can think of the number of lives that could have been saved all those years ago.

Lives are threatened in the human clinical stages of trials. In March 2006 six young men took part in a clinical trial at Northwick Park hospital and were nearly killed by a drug that had been tested on monkeys and shown to be safe, even at 500 times the dose that the men were given. That is not a trivial matter, and I can remember clearly when it happened. Again, I do not expect the Minister to respond now, but I hope that after she has taken advice she will be able to discuss what happened in that trial.

Clearly, the results from the monkeys created a false sense of security, yet the risk carries over even when drugs pass to market. Any number of hon. Members will have had constituents lobby them on the painkiller Vioxx, which was eventually withdrawn in 2004 after the biggest drug disaster in history—it killed more than 100,000 people worldwide in its five years on the market. Clinical trials of Vioxx revealed up to a fivefold increase in the risk of a serious reaction such as heart attack, heart failure or stroke, but tests on animals indicated that it was safe, and in some instances that it was protective to the heart, which supported the manufacturer’s decision to market the drug. I am currently dealing with two or three constituents whose loved ones were affected by the drug, and who are trying to get compensation, which, as hon. Members know, is quite a tough battle. One hundred thousand people were affected worldwide.

Why should animals be indicators of human response? Animals and humans are evolved complex systems and as such should be expected to demonstrate different responses to drugs and disease.

[Margot James (Stourbridge) (Con)]

A number of drugs registered for humans are effective in animals. Dogs in older age respond very well to Prozac if they are a bit down, and a hypertension drug for humans has proved effective in restoring the vitality of apes in zoos in Britain.

[Mr Amess]

I apologise to my hon. Friend in case I was going too far on one side; my argument needs to be balanced.

Mutations that cause genetic disease in humans are the norm in some animals. Johnson et al found in 2001 that out of 39 anti-cancer drugs tested on xenograft mice, only one mimicked the response in humans. I say to the hon. Member for Strangford (Jim Shannon) that that cannot be much to rely on.

[Jim Shannon]

We need balance in the debate because we are getting one side of the argument but not the other, which is that drugs have been successful in saving lives. I am not taking away for one second from those who have died as a result of inappropriate drugs but, with respect, we need that balance, but we are not getting it.

[Mr Amess]

Frankly, one life lost is too many, but we could have a big argument—

[Jim Shannon]

One life saved is worth it.

[Mr Amess]

Yes, I agree with the hon. Gentleman that it is a question of balance, but I hope to prove that animal experimentation is completely unnecessary and that we can achieve the same results through different methods.

There is a variation of response within humans—African Americans are more susceptible to lung cancer than Caucasians—so how can we expect animals to be reliable models?

Using animals as human indicators is also expensive, for it can keep cures off the market, hence the large cost of modern drugs to consumers and the health service generally. In the words of Robert Weinberg, from the Massachusetts Institute of Technology, the use of pre-clinical tests results in

“hundreds of millions of dollars…being wasted every year by drug companies using these [animal] models”,

according to Leaf 2004.

Other areas of valuable research that might help in understanding the impact of drugs in human beings suffer as a result of animal testing. Despite animal models forming a very minor part of research, they receive a large proportion of funding. Society does not need new research methods; it simply needs to fund the ones that we already have. The important point is that it is possible to test these clinical drugs on humans, so that we can have a better indication of how they will react pre and post-clinical trials.

Society needs to make a fundamental change from animal-based research to human-based research. If it is humans whom we are trying to help, then scientists must study disease and drug reactions in humans. New technologies, outlined by the Safer Medicines Trust, are based on monitoring human responses to new drugs in a variety of ways. Those range from combinations of tissues in “body-on-a-chip” devices to safe volunteer studies such as micro-dosing, where tiny amounts of a new drug are administered to human volunteers. Scientists, in turn, evaluate what the drug does to the body and what the body does to the drug. Micro-dosing in particular has shown to be highly predictive of results in the clinic. Astoundingly, these tests are already commercially available from a number of UK companies, and offer a much safer and less risky alternative to using animals in clinical trials.

More than 150 colleagues have signed a motion calling on the Government—it is Christmas and this is not too much to ask—to initiate a small, cheap comparative study to demonstrate whether these new technologies are indeed superior. Sadly, the Government are resisting such a study and insist that human biology-based tests are not better able to predict adverse drug reactions than animal tests, despite scientific evidence to the contrary.

[Roger Williams (Brecon and Radnorshire) (LD)]

The hon. Gentleman makes a compelling argument. Indeed, no one doubts his sincerity. However, if these human-based tests were more effective and cheaper than the animal tests, why are the commercially sensitive companies not taking that route? Why do they persist with animal testing?

[Mr Amess]

I am not going to fall out with a tough farmer, because the hon. Gentleman and I have perhaps slightly different views about animals generally. I understand his point, but he will be pleasantly surprised to find that there are many companies that now want to go for this different option. I have taken a lot of advice on it and we just need a little more encouragement from the Home Office and its advisers.

The attitude at the moment—I do not wish to be unkind to the Home Office—typifies the herd mentality that we are facing; a mentality that aims to promote quantity of opinion and that goes against the pioneering mentality of many breakthrough scientists. The comparison with human biology-based methods has attracted high-level support among scientists. Some 83% of GPs who were surveyed were in favour. Many colleagues have supported the early-day motion and I have received strong support for the Safety of Medicines Bill. All the scientists at the conferences of the Safer Medicines Trust in the House of Lords and the Royal Society were also in favour of my Bill.

The British Union for the Abolition of Vivisection is concerned that Britain is not one of the countries, such as Austria and Belgium, that has urged the European Commission to stand firm on an animal ban for cosmetics without exceptions, as was provisionally agreed by the European Union for 2013. That is not acceptable. Although I welcome the Government’s commitment to trying to encourage a reduction in animal experiments, there has so far been a lack of new initiatives to reverse what the evidence shows is a rising trend. I know that the Minister has received more than 20 proposals from the BUAV for policy changes. I very much hope that she will respond to those 20 points in correspondence.

Let me conclude with these thoughts. I am talking about negligible expenditure on a comparative study. The amount is quite small relatively, and—I say this to the hon. Member for Brecon and Radnorshire (Roger Williams)—pharmaceutical companies will willingly fund such a study, which would therefore not impose a cost on the public purse. Such a study could save the billions of pounds that are currently wasted on animal testing by reducing ADRs and boosting pharmaceutical company efficiency. Critically, the sheer scale of ADRs and the fact that they are increasing at twice the rate of prescriptions means that we have an ethical imperative to take action to address what is a serious public health problem, with reported deaths up by 155%, according to The Independent. The key question is this, and I hope that the Minister can answer it—if she cannot, I would appreciate it if she wrote to me: on what basis do the Government refute the evidence that a number of human biology-based tests have predicted ADRs that animal tests failed to predict?

As we move towards Christmas celebrations, we are drawn to the image of the nativity, with the infant baby Jesus and his parents surrounded by animals. The image and the link could not be clearer. I trust that the Government will reflect on what I have said today and ensure that the proposals in the Safety of Medicines Bill, which I introduced earlier this year through the ten-minute rule procedure, can be enshrined in legislation, as the final gift, after gold, frankincense and myrrh, to both kingdoms represented by the nativity.

17:17

[The Parliamentary Under-Secretary of State for the Home Department (Lynne Featherstone)]

I am grateful to my hon. Friend the Member for Southend West (Mr Amess) for securing this important debate. He has a long and honourable track record in campaigning on these issues. I am also grateful to others who have contributed to this debate, albeit through interventions.

Before I deal with the detailed points that my hon. Friend raised, I would like to assure him that I share his concern for the welfare of animals. Indeed, I take the responsibilities in my portfolio in that regard extremely seriously. As the Home Office Minister responsible for the regulation of animal experiments, I am in no doubt that we should license the use of animals only where it is essential and where there is no alternative. That is also Government policy. The Government recognise that the regulation of animal experiments is of significant public interest. In fact, I am sure that Members across the House receive many letters on the issue. We are therefore strongly committed to ensuring the best possible standards of animal welfare and protection for animals that are used for scientific purposes.

Current legislation provides a high level of protection for animals that are used, as I am sure my hon. Friend knows. Work cannot be licensed if it could be carried out without using animals, and the procedures must cause the minimum possible suffering to the smallest number of animals of the lowest sensitivity. I believe that this approach reflects closely what the public want and expect. In addition, the Government have made two specific and important commitments in respect of animal experimentation. The coalition agreement commits us to work to reduce the use of animals in scientific research and to end the testing of household products on animals. The commitment to work to reduce the use of animals is being delivered through a science-led programme led by the National Centre for the Replacement, Refinement and Reduction of Animals in Research, and the commitment to end the testing of household products on animals will be implemented using our licensing powers under the Animals (Scientific Procedures) Act 1986.

[Roger Williams]

I, too, am greatly concerned about animal welfare and the Minister will know that I have asked a number a questions on the issue. I recently visited Cardiff university to see how the animals kept for scientific experimentation were looked after. The key thing for me was that the relevant science departments were open to inspections at any time—night or day—as a particular inspector could ask to visit at any time. I thought that that provided a real safeguard for animal welfare.

[Lynne Featherstone]

I thank my hon. Friend for that intervention. He is indeed a frequent writer of questions to me on this issue. One of the key factors in holding standards so high is that the inspectorate can come in, at any time and in any place.

I shall touch briefly on European directive. The directive strengthens the protection of animals used in scientific procedures and harmonises regulation across the 27 states of the EU. We have very high standards in this country, and the ask is that we maintain them. I cannot give a specific commitment on specific issues until I have received and considered advice following the large response to the consultation exercise.

[Margot James]

I wonder whether the Minister is absolutely certain on the point about the EU directive. It is widely reported that that directive will remove the responsibility of scientists to review all other possible methods of research prior to testing on animals. Publications, including The Economist, have widely reported that; it may be erroneous, but I wanted to raise it.

[Lynne Featherstone]

I thank my hon. Friend and I can assure her that it is erroneous—and I hope those at The Economist are listening to this debate. We must be factual and ensure that we talk only in realities about this sensitive and important issue.

[Nic Dakin (Scunthorpe) (Lab)]

I very much welcome the Minister’s comments about the high standards of animal welfare that the UK Government uphold. I take it from what she says that in carrying out the transposition of the EU directive to this country, every effort will be made to maintain our high standards.

[Lynne Featherstone]

The European directive provides an opportunity to reduce some of the bureaucracy, but when it comes to animal welfare, I am looking closely at anything that might suggest any reduction in standards.

[Paul Flynn (Newport West) (Lab)]

Other forms of animal abuse involve small numbers—hundreds or thousands—of animals, but in comparison animal experiments involve them in their millions. Will the Minister tell me how many animals are subjected to experiments now and what she hopes the numbers will be in 2015?

[Lynne Featherstone]

I will have to write to the hon. Gentleman on the absolute numbers. I am not sure whether he means every animal in every experiment. What I am looking at in respect of the coalition commitment is whether we can use absolute numbers, how we should count genetically modified animals that receive no other harm, and what impact would be made if this country’s scientific community were to attract more investment. I am looking for something substantive, so that we can know exactly where we are with animal usage in experiments and so that I can deliver the coalition commitment in real terms.

Let me deal with some of the specific issues raised by my hon. Friend the Member for Southend West. He asked about thalidomide. At that time, there was much less animal testing, and thalidomide was tested only on rats. The toxic effects, however, are seen in rabbits. That tragedy led to the current system of testing, which is more robust.

[Paul Flynn]

If the Minister looks at the research findings, she will find that thalidomide was tested on rabbits, and tested on pregnant rabbits. Only when it was tested again on a particular strain of rabbit did the deformities appear. That is an example of a major failure of animal testing.

[Lynne Featherstone]

I accept that it was a major failure, as was the testing of Vioxx, notably in the case of the six gentlemen who went for trials. However, I am sure that if I asked my officials to find examples of test results that have been beneficial to mankind and saved many lives, we would see the other side of the coin. I do not think absolute policy should ever be based on specific and exceptional incidents, but we all work constantly to improve the situation.

Vioxx was licensed for clinical use on the basis of a battery of tests, including non-animal tests, animal tests and clinical trials. The problems were extremely rare, and came to light only when tens of thousands of patients were prescribed the medication. However, it is now alleged that the manufacturer, Merck, suppressed some safety-relating findings. I do not know whether that is the case, but if it is, there may be no substance in the belief that animal test data were misleading.

Let me now deal with the key issues raised by my hon. Friend the Member for Southend West about the usefulness of animal models as a means of investigating human disease. I have some sympathy with his arguments, to the limited extent that I think we should look critically at the animal models that are used and replace them with new or better models and technologies as and when they are developed. I believe that that is what happens in practice, but if there is complacency, I will do—indeed, I am already doing—my level best to challenge it, and so, I believe, will the National Centre for the Replacement, Refinement and Reduction of Animals in Research. I have visited laboratories and met representatives of the centre, and I think there is a general consensus that good science results from the best research, whether it involves animal models or human trials. We want good science, because there is no point in coming up with results that do not lead people to want to do their work in this country and obtain the best results.

[Paul Flynn]

Will the Minister give way?

[Lynne Featherstone]

I fear that the hon. Gentleman is more of an expert than I am.

[Paul Flynn]

The Minister has been very generous in giving way.

In the case of Vioxx and Seroxat, both of which have had major adverse side-effects, the problem seems to lie with the regulatory body. The Medicines and Healthcare products Regulatory Agency is funded entirely by the pharmaceutical industry. Until we have some independent control, the suspicion will always be there that the one who pays the piper calls the tune for commercial gain.

[Lynne Featherstone]

The hon. Gentleman has raised an interesting point, but my hon. Friend’s main point seemed to be that the human trials of Vioxx revealed an issue of which no one took any notice.

I think that my hon. Friend went a bit too far in suggesting—if I heard him aright—that animal models could not, or perhaps could only rarely, be used effectively to find treatments for human diseases. I believe that they have contributed hugely to the development of drugs that have saved lives.

[Jim Shannon]

What is sought by Members, and by many outside the House, is an assurance that any potential or suggested changes, or improvements, made by the Minister would not affect experimentation on animals to provide new medication that could save lives. It is clear that the medicines that have been perfected through such experimentation have saved not just hundreds of thousands but millions of lives. Can the Minister assure us that it will continue?

[Lynne Featherstone]

I can assure all Members in all parts of the House that the Government want the development of those medicines to continue, as long as a responsible and careful attitude is adopted to the animals that are used in the quest for better medicines. Those who conduct such experiments must adhere to the stringent standards to which I have referred, and search further and harder for alternative technologies. When I visited University College hospital recently, I saw some of the machinery that it is using instead of animals. The advances that have been made, have almost been made or will be made in the near future are amazing, and I am sure that any institution, whether a university, a scientific research establishment or a commercial venture, will want to provide the best conditions for their animals in order to get the best results.

[Chris Williamson]

On that basis, will the Minister assure us that we can look forward in the next few years to a significant reduction in the use of animals in experimentation, given that alternative methods are now available and more are coming on stream?

[Lynne Featherstone]

My intention and job is to push as hard and as far as I possibly can. In that, I have to be advised by the scientific community, my advisers, the Animal Procedures Committee and other groups, and I often meet animal rights and welfare groups to ensure that I get the balance right. I cannot give a definitive number, but the intention is to secure a reduction, as promised in the coalition agreement, in the use of animals. The NC3Rs is doing some amazing work and incentivising scientists to be innovative and to come up with good things that people will want to use. I have not brought the brochure with me but it was incredibly impressive on some of the changes that it is delivering. However, we can only go at a pace that can be gone at because, as the hon. Member for Strangford (Jim Shannon) said, I would not wish to inhibit genuine advances in what we can do to preserve human life.

Although there are differences between animals and humans, there are also many similarities, and it is these similarities that scientists seek out when choosing and developing animal models. In most cases, because body systems in other mammals tend to work in similar ways to those in humans, animal tests can predict how the human body will react to a new drug. Otherwise, they would not be used. It would be useless.

On the safety of medicines, which goes to the heart of this debate, animal studies are considered to be an indispensable component in the assessment of the safety and efficacy of a new medicinal product. Without animal testing, it is highly likely that a large number of potentially dangerous medicinal products would have to be tested in healthy volunteers and patients in clinical trials. That would be quite unacceptable. I shall mention micro-dosing in a moment.

For a medicinal product to be granted a licence, European and international legislation requires that the toxicity profile of a new drug be defined. In part, that entails the use of animal studies. Nevertheless, I accept the point made by my hon. Friend the Member for Southend West that the earlier a potential new drug can be safely tested in humans the better. Companies are pursuing this through methods such as micro-dosing, but that approach does not replace animal tests entirely.

On the use of new technologies and non-animal tests, I can assure my hon. Friend that, contrary to his fears, the testing of medicines has evolved and that new scientific methods, including those using human tissues, are being used and do have a place in safer medicine testing.

Today’s approach to drug development has evolved on a rational and scientific basis over more than 30 years and involves an integrated programme of computer-based work, in vitro studies, animal testing and clinical trials. I can report from my own observations on a recent visit to one of our leading universities that modern researchers use a variety of in vitro and computer-based methods alongside animal methods.

My hon. Friend mentioned adverse drug reactions. This is a far more complex matter than it at first appears. Like other Members, I have personal experience of this, as I am allergic to some common drugs that most people can take without difficulty. I attribute that not to an inherent fault in the drugs, which seem to work perfectly well for millions of other people, but rather to a quirk in the way my body reacts to them. I am allergic to certain antibiotics.

More generally, I think it is going too far to suggest that the occurrence of adverse drug reactions can be attributed to flaws in safety testing using animals. It has been estimated that 76% of adverse drug reactions are what are known as type A reactions, in which the medication has a predictable, but exaggerated, effect. Of the remaining, unexpected type B reactions, most are the result of allergies, such as mine, or individual susceptibilities that are difficult to predict in any trial.

On the attrition rate in the development of new drugs, new drugs are first tested in batteries of computer-based and in vitro tests. Refinements of these tests, including by using human tissues, are making them increasingly predictive. Many compounds are rejected as a result of findings from these tests before they are even tested in animals. It is true that at the next stage, as a result of adverse findings from animal studies a large number of drug candidates never progress to being tested in humans. However, as I have already mentioned, companies hope that this attrition rate will be reduced by using human material.

Finally, on the value of animal research, it is at present the case that without the judicious use of animal studies we would have no modern drugs, and we should acknowledge that the national health service would be unable to function effectively were it not for the availability of medicines and treatments that have been developed, or validated, through research using animals.

As I have explained, the Government are committed to minimising animal testing and to encouraging the development of other non-animal methods in place of animal testing where possible. The National Centre for the Replacement, Refinement and Reduction of Animals in Research brings together stakeholders in academia, industry, Government and animal welfare organisations to facilitate the exchange of information and ideas and the translation of research findings into practice that will benefit both animals and science. We will continue to give the work of the national centre our wholehearted support.

My hon. Friend the Member for Southend West asked the key question at the end of his speech: on what basis do the Government refute the evidence that a number of human biology tests predicted adverse drug reactions that animal tests failed to predict? The Government do not doubt the value of human biology tests in the testing of the safety of medicines, but it is important to recognise that all medicines have the potential for unwanted effects. There is not one in vitro test, or one series of in vitro tests, specifically for adverse drug reactions. It must be recognised that even extensive clinical trials in humans do not always predict the adverse drug reactions seen later when drugs are in widespread use.

If I have omitted to answer any of my hon. Friend’s questions, I will write to him. I thank him and all Members who have participated. This has been a valuable and thought-provoking debate, and I am grateful to my hon. Friend for securing it.

Question put and agreed to.

17:38

House adjourned.

Westminster Hall

Wednesday 7th December 2011 Westminster Hall

Wednesday 7 December 2011

[Albert Owen in the Chair]

Sudan and South Sudan

Wednesday 7th December 2011 Westminster Hall

Motion made, and Question proposed, That the sitting be now adjourned.—(Jeremy Wright.)

09:30

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

It is a pleasure to serve under your chairmanship again, Mr Owen. I declare an interest as the new chair of the all-party group on Sudan and South Sudan, and I pay tribute to the work of my predecessor, my noble Friend Baroness Kinnock, for her commitment to alleviating poverty and hunger throughout the region.

This is a particularly timely debate, as it is nearly six months since South Sudan became the newest member of the international community. It is a new state with good natural resources, particularly in agriculture, but with genuine challenges as one of the least developed countries in the world. Chronic food insecurity in Sudan and South Sudan has been exacerbated by delayed rains in South Kordofan, the conflicts in that state and in Abyei and Blue Nile, and rising commodity prices linked to global factors and border restrictions and closures.

Conflict has meant that hundreds of thousands of people, those who were displaced and those who were not, have missed the planting season and remain unable to access their livelihoods. As of 4 September, some 4 million people in Sudan and as many as 3 million in South Sudan were at risk of food insecurity according to the UN’s Food and Agriculture Organisation, which is of particular concern because the Sudanese economy depends on agriculture for almost a third of its output.

There have been significant recent developments across the two nations. Negotiations resumed between Sudan and South Sudan on 21 November in Addis Ababa, on several issues outstanding since the secession of South Sudan and expiration of the mandate of the comprehensive peace agreement in July. The negotiations focused on the sharing of oil revenues and on debt, trade, citizenship and border demarcation. But violence continues across Blue Nile and South Kordofan states in Sudan, with new waves of conflict-displaced people heading into South Sudan. The Sudanese armed forces state that they have captured key rebel holdings in Taruje, South Kordofan, which rebel Sudan People’s Liberation Movement North forces deny. Médecins Sans Frontières states that new waves of refugees are reported to be fleeing the Blue Nile region for South Sudan, as the Government army have intensified air raids on the rebel SPLMN. That follows reports by the Satellite Sentinel Project of aerial bombardments of civilian areas between 11 and 27 November by the Sudanese armed forces in Blue Nile state. Thirteen thousand refugees have been reported thus far. Tens of thousands of southerners in the north attempting to return to South Sudan are left in limbo, unable to return home or reintegrate into life. They have sold their homes and possessions and are stuck in temporary camps with limited access to basic amenities.

Unresolved issues between Sudan and South Sudan continue to give rise to considerable tension, as the Government of Sudan continue to halt the south’s oil exports until a transit fee is arranged. Sudan is also confiscating 23% of the south’s oil entitlement as payment owed since independence. It is significant that China has sent senior official Liu Guijin to mediate between the two states. Catherine Ashton, the European Union’s High Representative of the Union for Foreign Affairs and Security Policy, has expressed deep concern about the fighting in Blue Nile state and South Kordofan. The EU made €40 million available for humanitarian action in Sudan and South Sudan throughout September, part of which was set aside for South Kordofan. As I mentioned earlier, in late November, the EU welcomed the resumption of crucial negotiations in Addis Ababa between Sudan and South Sudan under the auspices of the African Union high level implementation panel, led by Thabo Mbeki. It urged both parties to make every effort to resolve outstanding issues, including those related to oil, transitional financial arrangements, borders and Abyei, and to reach a negotiated settlement.

The EU has announced that it would provide funds for new early recovery projects in areas of Darfur where the security situation is stable and to where displaced people have voluntarily decided to return, with priority being given to health, education, food security and securing livelihoods. On 11 November, the EU Commissioner for Development, Andris Piebalgs, announced that the European Commission had pledged €200 million to South Sudan to address key sectors such as health, education, rule of law and infrastructural development, particularly in connection with the construction of feeder roads. But the EU has not been able to disburse the €294 million pledged to Sudan in 2008 for between then and 2013, as Sudan chose not to ratify the revised Cotonou agreement because it included clauses about co-operation with the International Criminal Court.

There are ongoing conflicts in Abyei, South Kordofan, Blue Nile state, and Darfur. In Abyei there are still flows of people crossing the Banton bridge from Agok and going to areas north of the Bahr al-Arab, or Kiir river. Some 60 people cross daily and fewer return. The UK’s Special Representative for Sudan, Michael Ryder, stated in Juba on 1 December that the deployment of UN troops from Ethiopia in the Abyei region has led to improvement in the stability of the area. He indicated that civilians are now able to return to their homes and that the remaining controversy is about the formation of the Abyei administrative council. The Government of Sudan have indicated that they will fully withdraw their troops once the council make-up has been agreed.

In South Kordofan, international non-governmental organisations estimate that 300,000 people have been displaced since the summer. A camp for refugees from South Kordofan in Yida, South Sudan, was bombed by the Sudanese armed forces on 10 November, an act that has met with international condemnation. The United Nations High Commissioner for Refugees now plans to facilitate the voluntary relocation of some Sudanese refugees from the Yida site to safer locations further south. Heavy shelling has been reported though, and the UNHCR reports that 80,000 people have now fled conflict in South Kordofan and Blue Nile state. Some 36,000 Sudanese refugees are estimated to be in Ethiopia, in three refugee camps—Sherkole, Tongo and Fugnido—as well as at Adimazin transit centre. Foreign aid workers and journalists are still prohibited from accessing the area to verify information and provide much needed humanitarian aid.

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

I congratulate the hon. Gentleman on securing this debate. He is turning now to international access and the lack thereof, particularly by journalists. He is eloquently outlining the problems, but does he agree that one of the big issues from now on will be the information to the west and the developed world about what exactly is happening in Sudan and South Sudan, so that we can more appropriately and better deploy the resources to help the people there?

[Mr Bain]

The hon. Gentleman makes a very interesting and accurate point. It is interesting that more than 35,000 refugees have been displaced from Blue Nile state into Ethiopia, but up to 13,000 new refugees are fleeing Blue Nile into South Sudan as the Sudanese armed forces’ air raids on rebel forces are reported to have intensified on 2 December. Information about what is happening on the ground will be critical to resolving the disputes.

[Jim Shannon (Strangford) (DUP)]

Is the hon. Gentleman aware that some 700,000 southerners of Sudan have not had their nationality recognised? They are in a grey area—limbo-land. Does he feel that the Government should be doing more to address that issue, so that people know where they belong? Is it north, is it south—where are they?

[Mr Bain]

That is the issue to which I referred a few moments ago. I thank the hon. Gentleman for raising it once more. Clearly, the Government should use their influence to speak with Catherine Ashton and UN agencies to ensure that the issue is resolved in negotiations between the two states as urgently as possible.

To return to dislocation, a further 8,000 refugees are thought to be on the move towards South Sudan from Blue Nile state. Some are reported to have walked for more than a week to reach safety in Doro village in South Sudan, 40 km from the border between the two states. Satellite images captured in November indicated that war planes had attacked villages directly. Between 10,000 and 15,000 refugees are estimated to have fled to the border areas of Upper Nile state after infighting in Blue Nile state, according to UNHCR information.

The UN has reported new cases of displacement in both North Darfur and West Darfur as a result of continued offensives between the Government and rebels. Population movements have also been recorded in South Darfur due to ongoing military operations. Groups displaced before July continue to lack proper access to water, food, health care and sanitation, and humanitarian relief access to the area is also lacking. I hope that the Minister will address several issues in his closing remarks. Will the Government make representations at EU level so that all parties unite in calling for the two states to ensure the welfare of civilians by refraining from the use of explosive weapons in populated areas, agreeing an immediate ceasefire and allowing unimpeded humanitarian access? Will the Government engage in diplomatic efforts and encourage actors with leverage over both parties to seek a political solution to the crisis, including by completing post-comprehensive peace agreement negotiations with support from international or regional arbiters, and ensure that the promised popular consultations in South Kordofan and Blue Nile take place as part of broader efforts to include the concerns and priorities of civilians in peace negotiations?

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

I congratulate my hon. Friend on securing this debate. His point about encouraging all those with influence on both countries to exercise it to bring about peace is crucial. What role does he think the Arab nations in particular have to play in providing influence on the Sudan Government? I know that the Sudan Government were congratulated by the new Libyan Government on the support that they gave Libya. Maybe that influence could now be reciprocated to encourage progress in Sudan.

[Mr Bain]

My hon. Friend raises an interesting point. Where the Arab League and other actors in the Arab world can exercise positive influence, we should welcome that.

It is essential to support the efforts of the UN emergency relief co-ordinator to secure full and unimpeded humanitarian access. Will the Government encourage the EU to seek an end to any support for non-governmental armed groups operating on either side of the border, and support the establishment of a demilitarised zone monitored by the UN along the border?

The international community has been engaged fully in development issues since the signing of the comprehensive peace agreement in 2005, but one in eight children die before their fifth birthday, the maternal mortality rate is one of the highest in the world and more than half the population lives below the poverty line. More than 220,000 people were displaced by conflict last year, and more than 100,000 were affected by floods. Already this year, fighting in the disputed border areas, clashes between the Sudan People’s Liberation Army and militia groups, disputes over land and cattle and attacks by the Lord’s Resistance Army have forced nearly 300,000 people from their homes.

The 38 aid agencies working in South Sudan have made several recommendations: strengthen the capacity to deal with humanitarian crises; prioritise food security; strengthen the role of civic society; work with the Government of South Sudan to enhance social protection; encourage the development of smallholder agriculture as a means to improve women’s economic participation; address the land issue for returnees, internally displaced persons and vulnerable groups; and provide technical support for the Sudan-South Sudan border co-operation policy. The Sudan unit within the Foreign and Commonwealth Office has indicated that £150 million will be allocated for Sudan each year, with £90 million going to the Republic of South Sudan. To what priorities will that spending be devoted?

The people of Sudan also suffer the plight of HIV/AIDS. An estimated 40,000 people in South Sudan are living with HIV, about 14,000 of whom are eligible for treatment. Of those, only about 3,500 are receiving the medication that they need to return to health and prevent further infections. Between now and 2014, at least 11,000 people living with HIV/AIDS in South Sudan who need antiretroviral treatment will not have access to it, and might die unless additional funding is found. I commend the work of Alliance South Sudan, which currently supports 92 community-based organisations across 23 counties in eight of South Sudan’s 10 states, on its efforts to build capacity for an integrated HIV response.

The Global Fund to Fight AIDS, Tuberculosis and Malaria was founded in 2002 in response to the devastating impact of those three diseases. It is the largest international financier of action against AIDS, TB and malaria and accounts for 80% of funding for TB, three quarters of malaria programmes worldwide, and half the global AIDS response. It is currently chaired by the United Kingdom. To date, it has disbursed more than $20 billion in 150 countries, saving an estimated 6.5 million lives. It was rated as a high-performing institution providing very good value for money in the multilateral aid review carried out last year by the Department for International Development.

At the board meeting two weeks ago in Accra, however, it became apparent that, for the first time in the fund’s history, its supporter countries lack available funds to sustain the next round of funding. The decision was taken to cancel round 11, delaying any expansion in programming until 2014 at the earliest. That means that the fund will not be able to put more people on vital TB treatment or provide additional bed nets to prevent the spread of malaria. It will also lead to rapidly growing waiting lists for life-saving HIV medicine over the next two and a half years.

The replenishment conference in October 2010 raised just $11.7 billion to cover programming between 2011 and 2013, rather than the $13 billion required to maintain programming and modest expansion, or the $20 billion needed to scale up towards universal access. In addition, donor countries have not paid the amounts pledged on time or in full. South Sudan is among those countries where the delay could have a devastating effect. South Sudan was depending on the fund’s round 11 disbursement to fill a significant funding gap within its health response. Although it has a fully costed national AIDS plan, the plan has a funding gap of 80%.

The UK pledged £384 million in October 2010, in line with the existing £l billion pledge to the fund between 2008 and 2015 made by the previous Government. The Government are paying in full and on time, and have advanced some payments to help ease the fund’s cash flow issues. The UK has also pledged a significant increase in its contribution dependent on implementation of reforms, following the multilateral aid review’s rating of the fund as very good value for money, but nine months after the intention to increase funding was announced, it has not been confirmed.

Will the Minister agree to liaise with DFID to discover whether we can expect an announcement before the fund’s mid-term replenishment, due by mid-2012? Will the Government consider making allocations from DFID’s budget to deal with important issues such as prevention, care and support and work with children affected by AIDS in South Sudan? Will the UK use its influence to encourage other contributor states, such as Belgium, Denmark, the Netherlands and the United States, to follow through the commitments to tackle HIV/AIDS—US Secretary of State Hillary Clinton made that commitment in her speech on world AIDS day last week—by offering more financial support to the global fund? Could such action involve the hosting of a special donor conference next year?

The challenges to alleviate poverty and suffering across the two nations are severe. In July, Save the Children reported that South Sudan has the world’s worst maternal mortality rate, that a fifth of all its children suffer from acute malnutrition, and that only 10% of children complete primary school. A hundred midwives and fewer than 500 doctors cover a population of 8.3 million people. This represents the biggest development challenge in the world, and our response to facilitating an end to the internal conflict that has scarred the region for too long is a test of leadership for the international community.

09:51

[Martin Horwood (Cheltenham) (LD)]

It is a pleasure to serve under your chairmanship, Mr Owen. I congratulate the hon. Member for Glasgow North East (Mr Bain) on securing this timely debate, which is a reminder, if one were needed, that the securing of comprehensive peace agreements and the achievement of independence do not in themselves deliver peace and security or the welfare of the people involved. The situation in Sudan and South Sudan is, if anything, more worrying today than it was only a few months ago.

The hon. Gentleman rightly referred to the interaction between armed conflict—some of it state sponsored—and the creation of refugee situations, which are making the development picture and the welfare, health and security of the people even worse. He referred specifically to the attack on 10 November, when it was reported that there was a bombing raid on a refugee camp in South Sudan, apparently carried out by north Sudanese forces.

On that same day, a US satellite monitoring group also reported that the north was building up and upgrading its air bases and air resources in what could be perceived as the precursor to an even wider aerial bombing campaign. Those are worrying signs, especially when put in the context of the truly appalling record of the Bashir regime in north Sudan. Mr Bashir has repeatedly stated that there is no room for cultural or ethnic diversity in the Sudanese state, and has predicted the fall of South Sudan as a failed state.

Clearly, it is possible that Mr Bashir is himself trying to make that prediction come true and make it self-fulfilling. His record clearly indicates support for terrorist organisations and a closeness to Iran; Sudan is Iran’s only Arab ally. A staggering number of deaths have been caused by the conflicts to date. It is possible that some 2 million people have died in Sudan during this present conflict—possibly as many as 300,000 in Darfur alone.

The International Criminal Court has warrants out for Mr Bashir’s arrest, not only for war crimes but for crimes against humanity and, since July, for genocide; a further two ICC arrest warrants are still outstanding. The list of outstanding issues between South Sudan and the north is lengthy and worrying. It covers citizenship, the border, debt, oil revenues, security and the status of arms. Sudan has still not implemented key parts of the comprehensive peace agreement. Critically, an independent national human rights commission has still not been established, and there are serious unresolved issues in the provinces of South Kordofan and Blue Nile.

The hon. Gentleman rightly outlined many of the effects of this kind of uncertainty and conflict, the attitude of the Sudanese Government in the north and the way in which they interact with the situation. I will not repeat some of the appalling statistics that he cited. The question is: what do we think can be done about this and what can the Government do?

I know that the Minister has himself visited the region, as has the Secretary of State for International Development, which is welcome, and we have raised both the implementation of the comprehensive peace agreement and the issues of human rights with the Foreign Minister, Ali Karti, only in the past month. The situation, however, needs to progress and that does not seem to be happening at the moment. Simply making representations to the Sudanese Government does not seem to be having a great effect.

I think that we have other levers at our disposal. It is right that the focus of the Government’s international development assistance programme for Sudan and South Sudan should be concentrated on the south, where the development indicators are truly appalling. The worst statistic that I have seen comes from the Christian charity World Vision, which states that a 15-year-old girl in South Sudan

“has a higher chance of dying in childbirth than completing school”.

It also notes that

“One out of every seven women who become pregnant will probably die from pregnancy-related causes”,

and that

“While the under-five mortality rate has decreased, one out of every seven children will die before their fifth birthday (135 per 1,000 live births)”.

Nevertheless, some 35% of what I think is the £140 million a year committed to Sudan and South Sudan—some £50 million per annum—is committed to the north. Does the Minister have an assessment of how well that spending is going? Is it being targeted at measures that will help reduce conflict? The non-governmental organisation Saferworld has highlighted the need to control small arms in the north. Can our development assistance facilitate projects such as the Regional Centre on Small Arms, which will try to reduce the potential for conflict in small areas, at least in a small way?

It has been suggested that the role of the Arab League, which is now a very interesting organisation, might be stepped up. I think that, for many years, many people in this country and in the west wrote it off as a talking shop, but it has pursued a much more active policy over Libya and now over Syria. The potential for the Arab League to play a much more proactive role in trying to avert further conflict in Sudan and to put pressure on the Bashir regime is important.

There are other interesting forces in the region. I was at a symposium yesterday that involved members of the Muslim Brotherhood organisations and parties in the emerging democracies of Libya, Tunisia and Egypt. The Egyptian Muslim Brotherhood is, of course, located close to Sudan. Those parties are trying to prove their democratic credentials and to reassure potential western allies that, if they play a part in government in what we hope will be new democracies, they will respect human rights, have due respect for the rights of minorities and observe the democratic process.

If those parties are seeking connections with the British Government and positive and reassuring relationships with us, perhaps one of the tasks that we could set them, in a friendly way, would be to seek whatever influence they can over the regime and the Islamist movements in Sudan, and to point out that political Islam does not have to be synonymous with repression, the denial of human rights and a determination to exclude the rights of minorities.

There are other factors. The debt issue is important, because Mr Bashir would like to have access to support from everyone—from the International Monetary Fund, to the World Bank, to the African Development Bank. That seems to give us some international leverage. Has the Minister had any conversations with any of those multilateral institutions to see whether there are ways in which they can exert some influence on the Government in the north? War and conflict have been described as “development in reverse”, which I think is accurate. If funds are to be invested in these countries with a view to growth and to debt being written off, it is important that it is done in a context that means it is likely to succeed. The current context seems to provide exactly the reverse of that.

I will not speak for much longer because I am sure that other hon. Members want to contribute. Beyond the usual representations, expressions of regret and concern, and the commitment to facilitate a comprehensive peace agreement—although those are all welcome—I would like to hear from the Minister whether we will start to use other levers more imaginatively to try to resolve some of what is happening in Sudan and South Sudan. At the moment, the situation seems to be spiralling into an ever deeper conflict, which I am afraid seems to suit the purposes of the regime in the north. That may be a very bad omen indeed for the prospects of having a free, independent and prosperous South Sudan.

10:00

[Jim Shannon (Strangford) (DUP)]

I congratulate the hon. Member for Glasgow North East (Mr Bain) on bringing this matter to Westminster Hall for debate. The debates that we have are not always on local matters. We need to be aware of the influence that we have as a country in other parts of the world. People in our constituencies have friends and relatives in that part of the world, and therefore we have an interest in the subject.

I will make a few quick comments because it is important that we register concern about some of the issues. I am pleased to be called to speak. I am not sure whether many other hon. Members will contribute after me but, none the less, this is an important debate. I have a particular interest in Sudan because some of my constituents are missionaries in the country and I have received feedback from them on what they do out there.

When South Sudan was proclaimed and recognised as a state, it was very clear that the people who voted for it wanted that. I shall make a couple of comments in relation to South Sudan. By and large, a significant proportion of the people who live there are Christians. The country is rich in oil and its land is arable. It is productive for food production, which is good. However, China holds the oil leases and, as such, it controls what happens with the economy. All the oil in southern Sudan has to go north to get out to China, which is where two thirds of the oil goes. What discussions are the Government having with the Chinese about that? What influence can they put on them to relax the controls from north Sudan on those in the south?

It is of some concern that South Sudan is one of the least developed countries in the world. Are the Government sending people out to help train those Sudanese, so that they can do more for themselves, rather than their being dependent on grant aid from other countries?

South Sudan is a state recognised across the world, so although the following issue is perhaps not entirely relevant, it should perhaps be considered. The Olympic games are coming in 2012. Has any consideration been given to that? I know that there are issues surrounding health, food and all the important daily things that we take for granted, but have there been discussions with South Sudan about the Olympic games? Is it sending any representatives over? It is a new, virgin country. Is there any possibility that it will have representation in the London games next year? If it did have representation, that would be good. It is sometimes good for people to have some outside interest to look to and for people in Sudan to be able to say who their representative is. What is happening on that?

There are some 1 million Christians in Sudan—north and south—and I am sure that the Government are well aware that there has been persecution against some of them. Have the Government made any representations to the authorities, both north and south, on that? If they have, what feedback did they receive? Many of those 1 million Christians feel threatened by militant Muslim groups.

The hon. Member for Cheltenham (Martin Horwood), who spoke before me, mentioned human rights. I would like the Government to give me, and ultimately the people whom I represent and who have asked me to comment on the matter, some assurance that the human rights of Christians are being assured. What pressure has been put on Governments in the north and south of the country to ensure that such attacks stop? There is a bigger threat in the north than in the south.

In conclusion, I am ever mindful that China holds the oil leases and I have some concern that, whenever it comes to solving the problems, it is China that the area looks to. Is the influence of the west—the United Kingdom, Europe and the United States—being eroded by the greater elevation of China and the influence that it has in Africa? The United Kingdom and Great Britain has had traditional and historical influence in Sudan for many years and I want the Minister to assure me that that has not been eroded. I hope that he will take those matters on board.

10:05

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

I shall make a few observations and ask a few questions, to which I hope the Minister can respond.

It is obviously important for the EU to do what it can to put pressure on the various parties involved and on the Government of Sudan in particular. It is also vital for UN initiatives to be supported and to continue—as, indeed, they are—in parts of the countries concerned. Ultimately, as I said in my intervention and as the hon. Member for Cheltenham (Martin Horwood) also mentioned, neighbouring countries and Arab and African organisations will play a crucial role in securing a long-term change in terms of stability, peace, democracy and human rights.

Will the Minister say what steps are being taken to encourage the type of action, from the Arab League and our Arab neighbours, that the hon. Gentleman outlined? Also, what is the Minister’s perspective on the role that the African Union can play in not only the short term, but the long term?

Ultimately, the solutions to these problems will require not only peacekeeping—perhaps military intervention—but development co-operation among African countries themselves. That is the crucial way in which such conflicts can be resolved on a long-term basis. I would be interested in hearing what the Minister considers the role of the British Government can be in encouraging initiatives and co-operation at an African level to bring about the type of pressure and support that the situation in these countries so desperately requires.

10:07

[Mr John Spellar (Warley) (Lab)]

I congratulate my hon. Friend the Member for Glasgow North East (Mr Bain)—he has been congratulated before during the debate—on introducing this immensely important subject. As has been rightly said, the debate is very timely given the flashpoints of conflict, some of which are internal and some of which are external. Indeed, as I shall refer to later, there are also great concerns about the interruption of oil flow, which has an enormous effect on the economies, the budgetary position and, indeed, the solvency of both countries.

It is also important—this has come out substantially during the debate—to recognise that we must not simply focus on what these events mean for the countries concerned, for the ruling groups in those countries and, indeed, for those who are the participants in armed conflict. We need to highlight—I will refer to this later, but it has been mentioned several times during the debate—the impact that all this has had on the living standards and the opportunities for life of many of the people, particularly in South Sudan but, wider than that, in parts of Sudan itself.

During the conflict, which has rightly been referred to as one of the longest running conflicts, huge loss of life and devastation has been suffered by communities. It is absolutely right that tribute should be paid to a number of non-governmental organisations, several of which have been mentioned today—some are Church-based, but some are more secular, such as Saferworld. They have monitored the situation and ensured that the often unreported agony and misery of the people of South Sudan—not the sort of issue normally likely to be carried by television cameras, or where CNN is always likely to turn up—has been kept on the world agenda and has been the focus of international attention. That is important. The amount of oil is not hugely significant in terms of world oil supplies, and South Sudan is not an intrinsically strategic area, but it has some importance. It is not irrelevant because, as in so many areas of the world, there is a capacity for instability to spill across borders. We have already seen that to an extent in both this region and in the great lakes region. Conflicts continue in the border areas between Sudan and South Sudan.

According to reports, South Sudan is also witnessing the unwelcome attentions of the Lord’s Resistance Army. The LRA and other organisations have an impact on the Democratic Republic of the Congo and the wider region. In those areas, the outside world, including China, has significant mineral interests. China is involved in Sudan, quite properly, to obtain access to oil. We have to ensure that there is an equal bargain for the people of South Sudan and Sudan. We need to ensure that, given the huge importance of oil revenues to the budgets of both countries, there is an equitable distribution—I realise that that is not easy to calculate—to ensure a win-win situation. That will involve responsible behaviour by production and transportation companies, and by the final client.

It is undoubtedly true, however, that in spite of those revenues, the impact on society has been minimal. Hon. Members have mentioned the appalling figures on maternal mortality and infant mortality per capita income. Approximately 45% of people in Khartoum have access to water. In South Sudan, very few people have access to anything like clean water. We know the impact that that has on health, let alone on the ability to run any sort of modern society. My hon. Friend highlighted the huge impact of AIDS, which is not just confined to South Sudan, but to much of that area of central Africa. Efforts have been made, but it is an ongoing problem. Any breakdown in the provision of support and aid—indeed, any breakdown of society—can only hasten the spread of that disease and prevent the necessary relief, alleviation and medication.

We need to move on from the problems, which have been outlined in debates over a number of years, to the solutions. That requires us to look beyond the simple differences between Sudan and South Sudan. Not only is external reconciliation required between the two states—there is a number of issues still running between them—but some internal reconciliation. One problem is that for years Sudan fostered tribal divisions in the border areas and in South Sudan to undermine the independence movement in South Sudan. That is not unprecedented. British Governments often operated a policy of divide and rule, as did many other countries. However, its legacy might roll on for many years. We ought to be particularly concerned if division is ongoing, if various tribes are being armed and if ordinary criminal issues, such as cattle rustling, escalate into tribal inter-ethnic warfare. The whole cycle of violence and disruption could continue and ultimately affect the oil fields, which will be the basis of the two countries’ income.

Where is the light in all of this? My hon. Friend the Member for Edinburgh North and Leith (Mark Lazarowicz) highlighted the positive role being played by the African Union in hosting talks. In Somalia, the African Union is playing a more proactive role than it has in the past. It recognises that such instability can very easily spill over into other countries. In Somalia, problems have not been contained within its borders. We are only too well aware, for example, of the problems of piracy affecting international trade. Indeed, there was an announcement from the Under-Secretary of State for Transport, the hon. Member for Hemel Hempstead (Mike Penning), only this week regarding the UK response. The Kenyan Government are having to take action because of the disruption and enormous impact that banditry and piracy are having on the Kenyan economy. Many of its resorts are close to Somalia and the cruise-liner business uses the port of Mombasa. In the first half of 2010, approximately 60 cruise liners stopped at Mombasa; this year only one. That has a substantial impact on the local economy.

The idea, therefore, that such problems can just be contained in one area, and are only a problem for the unfortunate residents of that area, is no longer sustainable. The encouraging thing is that that is recognised as being no longer sustainable. That is why we see a more proactive position from the African Union. The Arab League was also mentioned. It has looked at countries in its region and the difficulties that can flow on. It has not taken the position that it should stand away from such difficulties and that such problems are problems only for the countries concerned. That is encouraging, and I hope there will be some interaction between the African Union and the Arab League. I hope that the Minister will comment on that.

The hon. Member for Strangford (Jim Shannon) mentioned the religious differences between South Sudan and Sudan. We know about the involvement of al-Qaeda in Sudan and how it was offered safe haven for a considerable period of time. Religious extremism is an additional concern to the mixture of various tribal and ethnic differences.

I have mentioned oil a number of times, because it is so significant: approximately 98% of the revenue of South Sudan. Arguably, oil was the driver for conflict in the past, with the desire of Sudan to keep control of South Sudan and the oil fields, the desire of the South Sudanese to have a greater share, and the vexed question of the transport of oil. It still has potential of course, with arguments about the price at which Sudan should be getting oil from South Sudan or the price of transiting oil through the pipeline, with Sudan wanting to charge what is estimated to be 15 or 20 times as much as transport on other pipelines in Africa, for example.

[Ian Paisley (North Antrim) (DUP)]

Does the right hon. Gentleman agree that one of the greatest investments that the western nations could make in new South Sudan would be in helping it to have a pipeline of its own, so that it could determine its own prices, rather than having to rely on Sudan, or to help it go through Kenya and find a way out in that direction?

[Mr Spellar]

As I used to say in ministerial times, I require notice of that question. However, if one already has a facility, which is a sunk cost, the most desirable outcome is to have a properly negotiated agreement to use that facility. One has to look at the distances, at which areas a pipeline would be running through and their safety and at the time scale involved, because constructing a new pipeline would be taken as an unfriendly act by Sudan. That might exacerbate tensions and could lead, for example, to cutting off the existing pipeline and therefore to no revenue at all—a potentially catastrophic situation for South Sudan. It is always worth examining alternatives—they might be viable—but they are not a real alternative to ensuring through whatever mechanisms, whether the UN, the African Union or the Arab League, that a modus vivendi is obtained between Sudan and South Sudan to ensure that oil, rather than a cause of contention, is a shared benefit.

[Martin Horwood]

Is the right hon. Gentleman concerned by the emergence of the so-called South Sudan Liberation Army in the relatively oil-rich states of Warrap and Unity, which the rebels are aiming to liberate—as they describe it—from the Government in Juba? They are advising civilians to evacuate towns and move to villages. Does that look like a deliberate campaign of destabilisation aimed at the oil revenues of the south?

[Mr Spellar]

I do not know what assessment has been made of the origins of that movement or who may or may not be supporting it, but it is absolutely clear that a continuation of the instability and fighting in those areas will not only disrupt the oilfields and revenue but, as we have seen so dramatically in South Sudan, southern Sudan and Darfur, completely disrupt all normal life, including agriculture, because of displaced populations. All that makes the area unviable and brings huge misery to the populations who, essentially, have to live in refugee camps, dependent on aid, and that is not a sustainable future.

A viable agreement between Sudan and South Sudan is therefore crucial. Sudan has a sizeable external debt—let us not argue about how it was acquired—which it has to service and South Sudan is totally dependent on oil for revenue, so both countries, for the viability of their Governments and their states, require a share of the oil revenue and a regular flow. It is argued that the interruptions to oil production have already led to sizeable reductions, with estimates of about a quarter, but I am not sure of the exact figure. Unless agreement is reached, those ongoing problems will continue; it is in both their interest to undertake an agreement. I referred to external and internal reconciliation, and no conflict between the two states is not alone in being hugely important. We have had worrying reports of attacks, although there are arguments that some are in response to guerrilla movements and attacks, but the facts need to be ascertained, and considerable international and regional pressure on the participants to lower the tension is needed.

One problem in so many areas of conflict once a peace agreement is signed, however, is the large number of people whose whole life had been bound up with military operations. I am pleased to see several colleagues from Northern Ireland in the Chamber, and a key factor is to create conditions of normalisation, in which arguments are settled in a normal fashion and become the norm or established practice. Year on year, people then gradually move away from their old way of life. Simply preventing people from shooting each other becomes important in establishing the norms of society; otherwise, the trouble could continue—a lot of it based on tribal differences running from generation to generation. However, tribal differences previously settled with traditional weapons are now settled with AK47s, causing huge devastation and the mass migration of populations, which become dependent populations. That is why it is so important for a real effort, using the experience from work in other areas of conflict, gradually to reintegrate groups who have been involved in guerrilla movements or in over-extended armies back into the population and for them to assume civilian roles. Again, that is why the reconstruction of agriculture, which my hon. Friend the Member for Glasgow North East mentioned, is so important, to provide alternative occupations and a security environment.

One of the difficulties on which I hope the Minister can comment is to do with those who did not participate in the violence or become involved in the various guerrilla movements and armed gangs if they are seeing all the benefits go to the people who were involved. That is not an unfamiliar story in many parts of the world. Getting the balance right is enormously difficult, but also enormously important and significant. So any programme must be community-based, as well as involving the participants, important though they are.

Another feature of the development of agriculture is, as has been mentioned, the appalling transport infrastructure. In many parts of the developing world, one of the key constraints on developing agriculture is access to market—the ability, when the harvest comes in, to get large quantities of produce to market and not to have it rot in the fields or during transport to market. We are all very much aware of the state of the infrastructure in South Sudan, and a significant priority in improving living standards and creating opportunities for people is the development of transport.

What is key and what I hope the Minister will report on in his contribution is that the effort has to be sustained. If the area descends once again into feuding civil war, I recognise the danger that the interest and, indeed, patience of the public in the wider world will start to run out. That is a key message that the Foreign Office must convey to the countries in the region in the best possible way—not threateningly, but in a matter-of-fact way—so that the people of South Sudan who have suffered so much for so long have some decent opportunities not only for themselves but for their children.

10:30

[The Parliamentary Under-Secretary of State for Foreign and Commonwealth Affairs (Mr Henry Bellingham)]

This has been a fascinating and well informed debate, and I congratulate the hon. Member for Glasgow North East (Mr Bain) on securing it. I praise him for his well informed and compelling speech, and pay tribute to him for his work. I also congratulate him on his election to the chair of the all-party group on Sudan and South Sudan, and I look forward to working with him in that capacity.

The House will know that I follow the situation in Sudan and South Sudan very closely. I was fortunate to visit Sudan in July, and was the first UK Minister to do so after secession of South Sudan. While I was there, I met a number of Cabinet Ministers, and impressed on them the UK’s continued commitment to Sudan. I made clear our hopes that they could work with their southern neighbours and international partners for a peaceful and prosperous future. Similarly, my right hon. Friend the Foreign Secretary was in Juba for its day of independence on 9 July. When addressing the people of the newest country in the world, he was sincere when he stated that the UK would stand by the people of South Sudan as they sought a future of stability, prosperity and lasting peace, particularly peace with its most immediate neighbours.

We should not downplay—the hon. Member for Glasgow North East made this point—the achievement of South Sudan’s peaceful secession on 9 July, which was the result of leadership in both countries, or the important role of the international community. Since then, we have seen positive developments in some areas of both countries. South Sudan has taken its place on the international stage, and has joined major international organisations such as the UN, the African Union and UNESCO. The signing ceremony of its accession to UNESCO was held recently at the Foreign Office. South Sudan has also applied to join the Commonwealth, a move which the Government strongly support. The application process will be an important means of ensuring that South Sudan entrenches our shared values of democracy and human rights. Commonwealth countries, including several of South Sudan’s neighbours, can provide important assistance in those areas.

Sudan has also shown some welcome signs of becoming a more constructive voice in regional issues—for example, in its support of the new Government in Libya, and the leading role it has played in the Arab League’s recent action against the Syrian regime. I will come to the Arab League in a moment. However, it is extremely unfortunate that there have been some worrying developments that lead us to believe the elusive goal of peace is still far from the reach of the Sudanese people.

The hon. Member for Glasgow North East and other hon. Members mentioned the states of South Kordofan and Blue Nile. Conflict continues in those states in Sudan, causing a humanitarian emergency. Neither national nor international organisations are being granted access to provide support to civilians affected by the conflict. We are supporting the efforts of the UN to negotiate access, and I hope that the visit of my noble Friend, Baroness Amos, UN Under-Secretary General for Humanitarian Affairs, later this month will lead to some progress.

We are very worried about reports of new offensives in the past few days around Jau and Talodi in South Kordofan. That escalation and spread of the conflict are putting civilians—those who remain in South Kordofan and the estimated 16,000 who have been displaced to Yida in Unity state—in even greater danger. We continue to make it clear to the Government of Sudan, the Sudan People’s Liberation Movement North, and the Government of South Sudan that there cannot be a military solution to the conflict in South Kordofan and Blue Nile. We condemn indiscriminate aerial bombardment by the Sudanese armed forces, and we are calling on those who are fighting to cease hostilities immediately, to allow unfettered humanitarian access to all populations, and to engage in inclusive political dialogue that addresses the root causes of conflict. We urge the Governments in Khartoum and Juba to respect each other’s problems, and to refrain from unilateral action and inflammatory statements.

Some hon. Members referred to nationality and southerners in the north. We are worried about the lack of progress in resolving nationality issues, which threatens to leave stateless thousands of southerners who have been resident in the north for many years. We are urging both Governments to extend the deadline, and to put in place administrative arrangements to address the problem.

There is a significant humanitarian issue for returnees to the south who are awaiting transport, and my hon. Friend the Under-Secretary of State for International Development recently visited the way station at Kosti to draw attention to the plight of thousands of returnees who have been waiting months to take barges south. We are working with the UN to ensure that their needs are addressed, and we are urging both Governments to assume responsibility for the returnees.

It is also worrying that there has been conflict across the international boundary between the two states, and the recent cross-border bombings by the Sudanese air force at Yida and Quffa are particularly worrying. I issued a statement at the time—on 10 November—condemning any action that puts civilian lives at risk. We are calling on all parties to exercise restraint, and to cease actions that provoke conflict within each other’s territory. It is totally unacceptable for either Government to provide support to proxy armed groups that contribute to conflict in their neighbour’s territory. There are worrying signs that both sides are doing just that.

I stressed the importance of non-interference to South Sudan’s Foreign Minister, Nhial Deng Nhial, when I met him on 24 September, and I repeated that message last week to a special envoy who had been sent to the UK by President Salva Kiir. I will make exactly the same point next week to the Sudanese presidential adviser, Dr Ghazi Salaheldin, when he visits London, and I will emphasise the critical necessity of allowing humanitarian needs to be addressed urgently.

As the hon. Member for Glasgow North East made clear, those latest events make it all the more important that both sides allow a border monitoring mission to deploy quickly. We will pursue a resolution at the UN Security Council in the next few weeks to ensure that UN peacekeepers can take on that important task in support of the two Governments. Some hon. Members, including the hon. Member for Cheltenham (Martin Horwood) and, in an intervention, the hon. Member for Strangford (Jim Shannon), as well as the hon. Member for Edinburgh North and Leith (Mark Lazarowicz), asked about how to engage the Arab League and the African Union. I agree that it is important to engage as many important regional organisations as possible. The region is engaged. Ethiopia supplied troops to go to Abyei. There will be an AU summit in January, and I hope that Sudan will be a key issue on its agenda. As the hon. Member for Glasgow North East said, and as the right hon. Member for Warley (Mr Spellar) emphasised, the regionalisation of the conflict could be very damaging to the entire area.

I want to speak about the unimplemented areas of the comprehensive peace agreement. It is incredibly important that decisions on oil, citizenship, border demarcation and Abyei are given urgent attention. We have been particularly concerned about the failure to reach agreement on an equitable sharing of oil revenue, and I am worried that the Sudan Government have recently raised the temperature by threatening to halt the trans-shipment of oil from South Sudan, as well as by making an unrealistic royalty demand for $32 a barrel, which is way over the going rate.

We welcome the constructive role being played by the AU’s high level implementation panel, which is mediating between the parties on these issues. Talks that it facilitated in Addis Ababa on 25 to 30 November reached no agreement, but some constructive proposals were placed on the table, including on the level at which compensation should be paid to Sudan for the loss of oil revenue. As the Foreign Secretary said yesterday in a joint statement with his Norwegian and US colleagues, it is vital that the two parties return to the table as soon as possible to find equitable solutions. Sorting out oil revenue is crucial to both countries’ economies and to both currencies.

A number of colleagues, including the hon. Member for North Antrim (Ian Paisley), referred to whether there could be a pipeline to South Sudan, which is a fair point. The proposal has been reported in the media on a number of occasions. Indeed, it has been suggested that a Japanese company could be contracted to build a pipeline to Kenya. We take the view that it does not make a huge amount of commercial sense, because peak production has already been reached and it would take a long time to build. The only sensible short-term way forward is to ensure that there is agreement between the two countries on this important issue. As I said, it is absolutely vital for both their economies.

I mentioned the importance of Abyei as one of the outstanding CPA issues. Obviously, we are concerned that neither the Sudanese armed forces nor the Sudan People’s Liberation Army has withdrawn fully from the Abyei area, despite the presence of the United Nations interim security force. We fully support UNISFA in its efforts to secure the Abyei area and to monitor the withdrawal of both parties’ troops. We are calling on the Governments of Sudan and South Sudan to co-operate fully with the mission so that it can deliver on its mandate.

Several hon. Members mentioned Darfur. There has been significant progress there, and I am pleased that the UK’s Special Representative for Sudan participated in a conference in Washington earlier this month, which saw discussions between the Liberation and Justice Movement, which has signed the agreement, and other groups that currently remain outside the peace process, about how they might be brought in.

The right hon. Member for Warley mentioned the LRA. I agree that one of the concerning developments recently has been the statement by a number of armed groups that they want to come together in a new umbrella organisation to work to overthrow the Government of Sudan. We want to see peaceful political change in Sudan. We are therefore greatly concerned about any talk of further incitement and use of violence.

Development assistance has been mentioned by several hon. Members. Despite the ongoing conflicts and the political difficulties that face both countries, it remains a priority for the UK to support the peoples of the two Sudans in building a more prosperous future. Our development programmes are based on the provision of substantial assistance to both countries. As well as humanitarian assistance, DFID’s support is focused on delivering basic services to those who need them most, and to building accountability of the Governments on both sides of the border.

As the hon. Member for Glasgow North East reminded us, we are providing £50 million a year to Sudan over the next four years. Alongside many other donors, we are contributing to its humanitarian needs. Indeed, the Under-Secretary of State for International Development recently announced additional support for the World Food Programme that will enable it to meet the humanitarian food needs of approximately 315,000 people who have been particularly affected by conflict in South Kordofan, Blue Nile and Abyei. DFID is also seeking to address longer-term development needs. Its programmes will improve education, ensure provision of clean water and sanitation, encourage better access to justice and support the demand for improved governance in Sudan.

We all know that the needs faced by South Sudan are absolutely huge. We are talking not about reconstruction, but the construction of a new country. There is virtually no infrastructure. I believe there are only 25 kilometres of tarmacked road, so the needs are huge. We will be providing £90 million a year for the next four years to help the people of South Sudan. We will be working closely with others, including the US, UN and EU, and our programmes will support accountable, inclusive and transparent government, economic growth and improved security and access to justice. In particular, the UK through DFID aims to help 240,000 children to get through primary school; enable 4 million people to receive life-saving health care and nutrition; help 1 million people get enough food to eat; provide more than 750,000 people with malaria prevention and treatment; and give more than 500,000 people access to clean water and sanitation.

The hon. Member for Glasgow North East mentioned the global fund, AIDS and the lack of support from other countries. I can assure him that, as far as the UK is concerned, we will be doing all we can to keep up the pressure on other donor countries. We have influence within the global fund, and I can assure him that we will be delivering on our commitment and working with other countries to ensure that they also deliver. I will certainly raise the specific ideas that he mentioned with the DFID Minister. We need to work in many other areas as well.

As the right hon. Member for Warley said, we must not forget about the silent majority of people who stayed outside the different militia and guerrilla forces. I agree entirely with what he said about agriculture. South Sudan has the most phenomenal potential to build its agricultural sector and put in place total food security. I was in South Sudan a year ago, and as I flew into Juba, I was struck by the incredibly verdant countryside on either side of the Nile, yet, after a mile or so, the ground became arid and rugged. Obviously, irrigation, modern farming techniques and irrigation are needed. Of course, there was irrigation in the past, before the conflict. The country was able to provide food for most of its people before the war started all those years ago. Food security is incredibly important, but we cannot have food security without infrastructure.

The hon. Member for Strangford mentioned the Olympics. We are in discussions with the Government of South Sudan to see how we can support their wish to participate in 2012. They have to join international sports federations and we are offering any help that we can. That matter has certainly been taken on board.

Several hon. Members raised the issue of debt. They will know that Sudan assumed responsibility for the entire £38 billion of international debt outstanding at the time of independence. Agreement was reached and based on an assumption that Sudan would be granted debt relief by the international community within two years of secession, failing which the two parties would have to renegotiate.

We have taken a leading role on the issue of debt relief for Sudan, including though the establishment of an international technical working group, to address the progress that will be required. I have raised debt relief with a number of key partners, including China. I can tell the hon. Member for Strangford that China is a key player, because it holds a great deal of that debt. We are committed to supporting Sudan in making progress towards debt relief. However, I agree with the hon. Member for Cheltenham. Sudan needs to understand the importance to its creditors of real and continued progress in resolving outstanding CPA issues and in ending the ongoing conflicts. He asked whether there is any other leverage that we can bring to bear. We do not have any arguments or disputes with the Sudanese people in the north. In our view, trade will create wealth and bring prosperity. We want to see the creation of jobs and cross-border trade between the two countries. Cross-border trade is one way to create wealth, but we will not see such trade if a war is going on.

I can tell the hon. Gentleman that there is leverage here. We are not going to advance trade at the expense of human rights; we have made that very clear. When I was in Sudan earlier this year, I went to Port Sudan in the east, where there has been a successful peace process. We made it clear that, where there has been a successful peace process, we will reinforce that with trade. Indeed, that is why we were pleased to see the Kuwait investment conference for eastern Sudan held last year. Where there is a successful peace process taking place in north Sudan, we will certainly do what we can to encourage UK companies to go there and invest. Obviously, there are obstacles as things stand at the moment with the different conflicts going on.

It has been an interesting and full debate with a huge amount of cross-party agreement. It has now been five months since the successful birth of South Sudan. As these new countries adjust to life as neighbours, we too have to adjust to dealing with two sovereign states. The CPA foresaw the possibility of two states co-existing peacefully and prosperously, maintaining the strong economic and personal ties that continue to bind people across the international boundary. For that to succeed, both countries must draw back from interfering in each other’s affairs, address the issues left unfinished from the CPA, and focus on resolving the conflicts within their own borders through inclusive governance and promoting economic and social development.

Our Government will continue to deliver, both in public and in private, tough messages about the work that both sides need to do. The urgency of such messages should be apparent at the heart of a region where the winds of the Arab spring are blowing, and it is vital that the international community, through the UN and regional organisations such as the African Union and the Arab League, does not reduce its efforts to resolve the outstanding problems of Sudan and South Sudan. We should also acknowledge the enormously positive work that is being done by many non-governmental organisations and civil society groups in addressing the needs of the Sudanese people—I highlight in particular the work of the Churches in Sudan and South Sudan and their humanitarian support and work for community reconciliation.

I thank the hon. Member for Glasgow North East for raising this issue and for giving me the chance to explain the Government’s position, and it is heartening that so many constructive, positive and imaginative suggestions have been made this morning. It is a crucial moment for Sudan and South Sudan; there is a lot to gain but, as the right hon. Member for Warley pointed out, a huge amount to lose. I hope that, with the focused attention of the international community, we can steer the path of those countries towards peace and prosperity for all their peoples. After decades of conflict and appalling, dreadful suffering, they deserve nothing less.

10:51

Sitting suspended.

Centenaries (UK and Ireland)

Wednesday 7th December 2011 Westminster Hall

11:00

[Naomi Long (Belfast East) (Alliance)]

The timing of this debate is in many ways very appropriate. Yesterday, 6 December, marked the 90th anniversary of the signing of the Anglo-Irish treaty, which led to the formation of the Irish Free State, as was, and ultimately to the partition of Ireland and the creation of Northern Ireland. It also led to the Irish civil war, which some sources believe may have claimed more lives than the original war of independence against Britain that preceded it.

In the context of this debate, it is worth noting that not only did the civil war leave Irish society divided and embittered in its immediate aftermath, but that the political divisions of that era remained the dominant cleavage in Irish politics for almost a century, reflected by the two main political parties, Fianna Fáil and Fine Gael—the direct descendants of the opposing sides in that war.

Arguably, the 2011 Irish general election, which took place against the backdrop of the serious financial and economic crisis, is the first in Ireland’s history that has departed significantly from civil war politics. That is evidenced by the clear switching of voters between those parties. We can therefore be in no doubt that history casts a long shadow forward. The events of the past shape us—shape our identity, shape our present and also shape our future, to the good or otherwise, and never more so than when those events are contentious.

We are rapidly approaching the start of a decade of centenaries of seminal events and significant milestones in the shared history of the UK and Ireland. The period in question commences with the signing of the Ulster covenant in 1912 and the Home Rule crisis; covers the period of the first world war, from 1914 to 1918, including the battle of the Somme in 1916 and the Easter rising in the same year; and culminates in the events to which I have referred regarding the partition of Ireland.

During the period of history that I am describing, in 1912, the Titanic was launched and, tragically, sank—an issue of huge importance to my constituency, in which she was built. The period also stood witness to the emergence of the Gaelic revival movement and to the rise of both the women’s suffrage movement and the labour movement, from which flowed universal male and limited women’s suffrage in 1918. The Dublin lockout, which lasted from August 1913 to January 1914, was probably the most serious industrial dispute in Irish history, reshaping entirely the relationship between worker and employer. Also during that era the Irish Citizen Army, the Ulster Volunteer Force and the Irish Volunteer Force were formed, the latter two being actively engaged in gunrunning activity.

I concede that the list that I have given is very long, but it is by no means exhaustive. I have focused entirely on centenaries, without reference to the fact that, in the same period, we will mark other significant anniversaries, including the 400th anniversary of the plantation of Ireland.

The period between 1912 and 1922 was one of considerable change and turmoil, which shaped not only Northern Ireland, but the relationships within and between these islands. Sadly, in much the same way as post-partition politics in the Republic has been defined by the civil war, the divisions evident during that period remain to a large extent the basis of divisions in modern Northern Irish society. Therefore the manner in which we publicly mark those historic events, which remain both sensitive and emotive, is hugely important to preserving the current stability and, more importantly, to the building of a peaceful, stable and shared future.

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

I congratulate the hon. Lady on securing the debate. She is referring to the manner in which and the sensitivity with which commemorations are held. Obviously, the timing of the centenaries of each of the events that she has outlined is fixed, but does she agree that in the divided society that we have in Northern Ireland, how and where those events are commemorated is very important—so that they can be celebrated, rather than causing divisions like those that occurred in the past?

[Naomi Long]

I agree entirely. Celebrating may not always be appropriate. It may be a case of marking or commemorating some of the events, which are still very emotive. That is an important point.

Handled well, the coming decade has the potential to allow us to explore our past together, aiding understanding through education and discussion, and helping us to learn from our past and to consider how we can create and shape stronger and better relationships and enhance community relations. By contrast, if handled poorly, it has the potential to be a highly charged and fractious period, marked by deepening antagonism and division in society, and playing to and reinforcing centuries-old divisions rather than focusing on future progress.

[Mark Durkan (Foyle) (SDLP)]

I congratulate the hon. Lady on securing this important debate. Although it will be impossible to achieve or express a received version of our history in relation to all these events, it is of course right that we should be responsible in dealing with the centenaries. However, particularly as the decade progresses, we will also be hitting significant 50th anniversaries, which might be much more contentious in the north. Surely that adds to the point about getting the treatment of the centenaries right, in a measured and responsible way.

[Naomi Long]

I agree entirely. The degree of maturity displayed over the coming 10 years will set the tone for the handling of events that are lived history for many of us who grew up in Northern Ireland during the troubles. That is an important point. People will of course have their own perspectives on the past and, indeed, differing aspirations for the future, and the free expression of that cultural diversity is a cornerstone of any normal liberal democracy. Different parts of the community will inevitably wish to place differing emphasis on selected events, and the right to do so should be respected.

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

I congratulate the hon. Lady on securing the debate. Does she agree that in relation to these largely, shall we say, contentious issues, there must not only be very good management? We must all seek to build consensus and to develop understanding so that we can celebrate our shared identity. We must build, in many ways, an active process of reconciliation.

[Naomi Long]

I agree. What the hon. Lady refers to is hugely important. I am about to come on to how we can go about doing that.

The desire to place context around the public marking of the centenaries is not about curtailing people’s expression of their perspectives and aspirations, which may differ. It is about ensuring that space and opportunity are created for discourse, interaction and debate in order that people have the opportunity to engage with aspects of our history with which they would not traditionally associate and to consider alternative perspectives on those events with which they most closely identify, so that no single narrative crowds out all other opinion.

It is therefore important that both Governments are involved in marking events throughout the period and not just those aspects of most relevance to their own jurisdiction. I hope that that approach will be reflected in the Minister’s response to the debate. I shall give just one example. During a recent visit to Belfast city hall, the Taoiseach specifically asked to see the original covenant table, which sits in the council chamber; and, in recognition that there is interest among people in the Republic of Ireland in marking the signing of the Ulster covenant, the Irish Government are supporting work by the Orange Order in the south to mark that event and to collate the history of those communities.

[David Simpson (Upper Bann) (DUP)]

Does the hon. Lady agree that although the anniversaries or centenaries in Northern Ireland—and, of course, the Republic of Ireland—are important to both sections of the community, it is important that this matter is not left to the devolved Administration and that our national Parliament should also get involved?

[Naomi Long]

I agree entirely. One reason why I sought this debate is my belief that both Governments need to be involved in structuring the commemorations, as both Governments were heavily involved in the original events.

The transformative power of respectful commemoration based on inclusion and cultural diversity is also reflected in the preparatory work by the Northern Ireland Community Relations Council and the Heritage Lottery Fund. In developing their guidance notes for funding bodies, called “Remembering The Future”, they have stated in relation to the forthcoming centenaries:

“How these and others are marked in public as opposed to private space will chart the progress this society is making on its journey out of conflict. These anniversaries need not be mutually exclusive; indeed, if the commemorations are handled sensitively, they will provide an opportunity to underline how much of our history is shared.”

It is that potential that I want to explore in the remainder of the time available to me.

Given the huge improvements in east-west relations during my lifetime—marked most notably by Her Majesty the Queen’s recent state visit to Ireland, hosted by former President Mary McAleese—the decade ahead is an important opportunity to build on that established good will and progress and to enhance further the relations between the UK and Ireland. In doing so, it can make a tangible contribution to cohesion, sharing and integration in Northern Ireland. The success of that historic royal visit also teaches us important lessons about how to maximise the benefit of these unique opportunities when they present themselves. Such events are not spontaneous, but require a mix of detailed planning, careful management, sensitive choreography and strong political leadership.

The same is true of the upcoming commemorations, so I am pleased that the Taoiseach, despite all the other challenges facing Ireland, is establishing a commemorations committee to oversee his Department’s work, and that an all-party Oireachtas consultation group on commemoration has been established, which is being chaired by Jimmy Deenihan TD, who is Minister for Arts, Heritage and the Gaeltacht. I trust that that will provide a good basis for close east-west and north-south engagement. Today gives us an opportunity to probe the preparations being made by the UK Government ahead of the commencement of the upcoming decade next year.

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

Does the hon. Lady agree that with everyone participating in the preparations for these centenaries, it is vital that no one tries to rewrite the history of the United Kingdom or Ireland?

[Naomi Long]

I agree. I assume that the hon. Gentleman has sneaked a little peek at my speech, because I am about to move on to historical rigour.

Working together, the British and Irish Governments, along with the Northern Ireland Assembly, local councils and other interested groups, all of which are planning for the upcoming period to varying degrees, can set the tone for how events are marked and ensure that certain principles apply. Those principles include placing events in an inclusive and shared framework and looking to the wider history and context of the time in these islands and across Europe, rather than allowing celebrations to fragment into a series of, at best, exclusive and, at worst, divisive, events marking each centenary.

That spirit of inclusion must be matched with historical rigour. While there is still no shared or agreed narrative about many of the events, and while many myths continue to endure, there is a set of agreed historical facts, which should be the starting point for exploring different perceptions and interpretations of history. It is also crucial that we consider not just individual events in isolation, but their consequences, if we are to develop a deeper understanding of the period and our interrelated history. Much good work has been done already, and the Minister will be able to set out in his response the work that the UK Government have done in preparation for the coming period.

Time does not permit me to reference all the ongoing work, but I want to flag up Belfast city council’s commemorations working group. This cross-party group has developed a plan that, rather than focusing on individual events, has framed a programme divided into three chronological periods. The first, entitled “Shared History, Differing Allegiances”, covers 1912 to 1914. The second, which covers 1914 to 1918, includes world war one, the Somme and the Easter rising. The third will cover the events surrounding the partition of Ireland. That thoughtful approach to the civic commemoration of those events is a good example of cross-party working, and other work can be based on it.

Clearly, many of these events are significant beyond Northern Ireland, having both a national and international context. They will therefore be marked not only in Northern Ireland, but throughout these islands. The co-ordination of approaches will therefore be crucial if we are to maximise the opportunity not only to build good relations, but to capitalise on the upcoming period’s heritage and cultural tourism potential.

Northern Ireland has a competitive advantage because of the international interest in Ireland and the UK generally, including in its varied culture and history. It also has a strong creative industries and arts sector, and that shared asset is well placed to develop inclusive, high-quality cultural engagement and products around these historic events.

More broadly, Northern Ireland’s attractiveness as a general tourism destination has been boosted significantly by the positive publicity generated by a number of international events—including, most recently, the MTV awards in Belfast. National Geographic Traveller has listed the city as one of the top places to visit in 2012. That accolade comes on the back of TripAdvisor listing Belfast as the best-value UK city break, Lonely Planet encouraging people to visit the city before the rest of the world does and the Financial Times listing it as one of the top 10 places in the world to hold a conference or major event.

The recommendation by National Geographic Traveller reflects the 2012 Titanic centenary. The story of the Titanic creates an almost unrivalled international draw for Belfast, and particularly for my constituency, where so much of the authentic physical heritage linked to the construction of the Titanic is located, and where the construction of the Titanic Signature project is also making rapid progress. The year 2013 will see Derry/Londonderry assume the mantle of UK city of culture, and Northern Ireland will host the World Police and Fire games, which will, again, add to the tourism opportunities for Northern Ireland.

Co-ordination of the commemoration activity throughout these islands, and close collaboration between tourist boards, the arts sector, business and civil society will be necessary to ensure that the cultural, heritage, tourism and related economic benefits of the coming period are maximised and that the tourism legacy created continues to contribute to economic growth beyond the immediate decade.

The coming decade therefore presents us with both a challenge and an opportunity. It will not be easy, and the issues that are raised cut to the core of current divisions, but it would send a very positive message and mark real political progress if a mature, agreed way forward on sensitive issues could be found in Northern Ireland and between the UK and Ireland.

These events present us with an opportunity to move beyond the divisive historical legacy of the period marked by these centenaries and to deliver a watershed transition to a new era of shared history, where the focus shifts increasingly towards healing divisions, building cohesion and addressing our joint economic challenges.

We can respectfully and sensitively mark our shared history but refuse to be held captive by it. That aspiration can be advanced. The UK and Irish Governments have a role to play in that process. The east-west dimension was crucial to the history of the period we are talking about, and it remains important to exploring and commemorating it successfully in the years ahead.

I am grateful to have had an opportunity to raise this matter in Westminster and for the participation of other Northern Ireland MPs in the debate. I look forward to the Minister of State’s response, as I know from my discussions with him and the Secretary of State that the Northern Ireland Office is keen to make progress with others on this decade of positive change.

11:09

[The Minister of State, Northern Ireland Office (Mr Hugo Swire)]

I thank the hon. Member for Belfast East (Naomi Long) for her opening speech and congratulate her on securing a debate on this important issue. It will not come as a great surprise that I agree with much of what she said and with the responsible and interesting contributions of all other Members.

We all have different interpretations of history. Too often in Northern Ireland, the celebration of the past has been a cause of division. Respectfully, I submit a challenge to all those with any influence. The biggest challenge with these anniversaries is to recognise the past in a manner that does not cause hurt and does not offend, but that seeks, at least in some small way, to bring people together.

We approach a decade that will witness many important anniversaries, including the centenaries of the Ulster covenant, the battle of the Somme, the Easter rising and the Government of Ireland Act 1920. Each of those events will evoke different images and represent different understandings of our past; that is the reality. However, this decade also affords us an opportunity to come together in a spirit of mutual respect. That is possible; we need look no further than Her Majesty the Queen’s ground-breaking visit to the Republic of Ireland in May. Many people thought that a bridge could not be built over the painful events of the past and the different interpretations of history, but they were wrong. The key is to learn from the past and, as Her Majesty put it,

“to bow to the past, but not be bound by it.”

For too long, we have concentrated on our differences as we have sought to acknowledge our history. Yet, if we look at the past, we can see strong evidence of a shared history. Sir Edward Carson, the first person to sign the Ulster covenant, was born in Dublin and educated at Trinity college. James Connolly, who took such a central part in the Easter rising, was born in Edinburgh and served in the British Army for seven years. Willie Redmond, whose brother John was an Irish nationalist leader, died fighting in the first world war at Messines, in Belgium, and I visited his grave there in June. All this shared history has often been kept quiet by those who seek to emphasise differences and divisions.

For our part, the Government feel that some form of recognition is important. My hon. Friend the Member for South West Wiltshire (Dr Murrison) was recently appointed as the Prime Minister’s special representative to co-ordinate events to mark the centenary of the first world war. Those events will, of course, have particular resonance in Northern Ireland and, indeed, in the Republic of Ireland, given that people from both traditions fought and died alongside one another in the face of a greater oppression.

One hundred years ago, this Parliament witnessed important events that were to shape the lives of future generations, and we are exploring options for marking them in some small way. That is being done in consultation with the Irish Government and all interested parties. To use Her Majesty’s words in Dublin, this will be done in a manner that emphasises the importance of forbearance and conciliation.

Although the UK and Irish Governments must play a significant role in ensuring that we approach this decade in a constructive and complementary manner, the greatest challenge will lie in ensuring that that approach is adopted in Northern Ireland. It is there that the Executive and the mainstream political parties must take the lead in ensuring that those who would seek to undermine the political process do not have the opportunity to do so. Those people oppose forbearance and conciliation and will try to use important anniversaries to further their own regressive agenda. They are the same people who in 2011 try to recreate the worst parts of our history. They do not want to commemorate loss and suffering; they want to create it. They do not want to recognise battles fought 100 years ago; they want to fight them all over again. Those people thrive on the suspicion and mistrust that can come from our different interpretations of history. They should not be allowed to hijack history to suit their own narrow and biased agendas.

As we approach important anniversaries, the greatest weapon we have against those people is tolerance and understanding: tolerance for different but equally valid perspectives on past events and understanding that celebration of those events may offend those with a different perspective. As I stated at the beginning of my speech, I respectfully submit that challenge to all those with influence. It needs real leadership, and we are not short of leadership and courage in Northern Ireland. We are where we are today thanks to the leadership and courage of many brave people. We cannot change history, but we can change how we deal with it and we can do all that we can to ensure that the commemoration or marking of significant events brings people closer together, rather than driving them further apart.

As we move towards a decade of anniversaries, we should think more of commemoration and less of celebration; more of recognition and less of triumphalism—

[Dr McCrea]

While we are in the midst of the Government’s preparation for the centenaries, is it not also correct that Northern Ireland should be a vital part of next year’s excellent celebrations for Her Majesty’s diamond jubilee?

[Mr Swire]

I imagine that Her Majesty would want to visit all parts of the United Kingdom in her jubilee year and equally that all parts of the United Kingdom would want to receive Her Majesty and recognise the extraordinary work that she has done on behalf of the nation throughout her rule. The hon. Gentleman will, as a musician, know how dangerous it is to interrupt someone who is reaching his peroration, so if he will forgive me, I shall step back a bit, to try to get back in the mood that I was in before he interrupted me.

As we move towards a decade of anniversaries, we should think more of commemoration and less of celebration; more of recognition and less of triumphalism; and more of mutual understanding and less of mutual mistrust. Our language should be temperate; our ambition should be to educate; and our objective should be to bring people together.

11:23

Sitting suspended.

Pension Plan Charges

Wednesday 7th December 2011 Westminster Hall

[Mr Roger Gale in the Chair]

14:29

[Brandon Lewis (Great Yarmouth) (Con)]

It is a pleasure to serve under your chairmanship this afternoon, Mr Gale. I declare an interest: I have a pension myself, and I draw Members’ attention to the Register of Members’ Financial Interests, as I have an interest in a company that has a pension scheme.

“Annual management charge”, “reduction in yield” and references to “bid/offer spread” are just a few of the descriptions that can be attached to our pension pots. When our annual pension statement arrives, do any of us study it in great detail, or do we just glance at it before scratching our heads and filing it away?

I imagine that most consumers feel confused when they see phrases such as “annual management charge”, “reduction in yield” and “bid/offer spread”. A natural reaction is to assume that pension companies and fund managers understand it all and know what is best for us. Many, however, feel that the information is important, but do not understand why that is so, or what it means, particularly, for their final pension pot. That is why the pensions industry and the financial media will carefully watch our deliberations today. Perhaps the complexity of the issue means that many people are unable to understand and see the purpose of it, or why it matters so much. That may well be an indication of why Members are present today.

It is right for there to be constant demands for transparency about pension fund investments, as the hon. Member for Dagenham and Rainham (Jon Cruddas) highlighted in an Adjournment debate last year, and transparency about pension charges should be no different. It is easy for us, as politicians, to exhort that everyone should save for retirement—they are easy words. We want people to do that to be able to provide for themselves when they are older. In Government, it is easy and clear, with our experts to advise us, to see why that matters and why money put away when we are young matters more as we get older. The biggest challenge for the Government and the pensions industry is to overcome consumers’ attitude towards pensions—only half of working adults between the ages of 20 and 64 are currently saving for retirement.

Although the biggest reason given by consumers for the lack of saving is their inability to afford the contributions required to build a pension pot, there are other interesting underlying problems. A quarter of respondents in a study by the National Association of Pension Funds stated that they did not trust the pensions industry. Other surveys indicate that 80% of people want greater transparency about how pensions operate and what they cost. Although research conducted by a pension provider, Aviva, suggests that only 2% of people cite charges as the single prohibitive factor preventing them from investing in a pension, the proportion rises to a worryingly staggering 20% for the under-24 age group.

Can we assume that the lack of transparency about pension charges, alongside a misunderstanding about the system of charges, is a fundamental problem holding back a wider retirement savings culture? If so, it is particularly pronounced among the lowest age groups and lowest earners. We need to target the transparency at the new generation of workers, whom we need to get saving as soon as they enter the workplace.

My position in today’s debate is not to focus or comment either way on the level of charges; it is for the companies that provide pensions and advice on pensions to argue why their charges are at a particular level when the charges of others are at another. The point of today’s debate is to highlight the need to be able to compare and understand charges and costs.

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

I congratulate the hon. Gentleman on securing the debate. Regarding the lack of transparency about charges, we sometimes see what I believe to be helpful information in the financial press. We should push companies to ensure that they provide information on the impact that those charges will have, year on year, on the final pension received by a payee.

The point that needs to be clarified is the effect that charges will have at the age a person retires—60, 65 or 68; it is not just about making sure that the charges are transparent. Surely, if the ongoing and year-on-year impact of those charges were transparent, there would be a huge impact on a person’s choice of company.

[Brandon Lewis]

The hon. Gentleman makes a good point, and I will touch on it later. I fully agree that one of the issues that people do not understand is that a figure that seems small now can have a huge impact on how a pension pays out later on—up to 25%, as I will touch on later. The hon. Gentleman is absolutely right. That is exactly the clarity and understanding that we need.

Provident Financial’s clients are low earners, who often borrow just £100 or less to get through to the end of the month. The company told me recently that the issue for many of them is not so much about whether they can save. They may be able to save only a small amount; I know that the Minister appreciates that, because we have had a conversation about it. In some cases, it could even be just a few pounds a week or month. However, all that money can add up to mean something later.

The hurdle that those customers find is psychological. The company said to me that people who are on the lowest incomes understand and learn how to manage their money and how to get their family through a week or a month. Within that, they will still do certain things—£1 or £2 a week on sweets for the children, or something like that. What they do not do is trust an unnamed and unknown big organisation with some of their money, because it is complicated and there is no face to it. That is why they use organisations such as Provident Financial rather than high street banks.

By dealing with the issue of transparency, we may well be able to break through that psychological barrier and get more people saving. If the industry is clearer and puts things across more simply, it will instil more confidence in the customers that it is looking to pick up. I will return to that with a clear example in a moment.

The system is complex. People’s underlying attitude is unsurprising, given that we have such a diverse and complex pensions industry, with a wide range of schemes and options alongside an array of different regulatory regimes. A wide range of items may be included in pension charges—and alas, with no clear industry standard at the moment, providers often differ on what is included. Just to name a few, any or all the following may be included: product management, communications, services, administration, regulatory requirements, some investment management and, possibly, the cost of providing advice. How can any consumer find an easy way to compare like with like when there is such a range of options and figures printed on a statement? It is simply not possible.

[Jim Shannon (Strangford) (DUP)]

I, too, congratulate the hon. Gentleman on bringing the matter to the House today. We need clarity about hidden charges—charges that people do not know are being made and which are removed from people’s funding regularly—and about sales commission. There are often hidden charges before someone can leave a scheme.

There is also excessive trading in respect of those who are trying to keep on top of the portfolio; there is a charge every time that happens, and customers do not know that. There are a lot of hidden charges that customers do not know about. Does the hon. Gentleman think that such charges should be made known to the pension holder, so that they are aware of the costs involved?

[Brandon Lewis]

It is absolutely right that as much as possible should be transparent—potentially, everything should be as transparent as possible. The hon. Gentleman is right. As I will come on to say, people do not necessarily understand that when they come out of certain schemes or change jobs, the potential cost to them can as much as double. The costs are effectively hidden, because they are not clear or transparent at the time of entry, let alone of exit. That is why we need regular transparency. I will touch on that further in a moment.

It does not seem possible to find an easy way of comparing like with like. Just last week, the Work and Pensions Committee was taking evidence on pensions and it became very clear from looking at different operations that there are major variations in style between companies. What highlighted the issue of transparency for me more than anything was the fact that one company said that the simplicity and transparency of its charges is its single biggest marketing advantage. If Members will bear with me, I will read a short quote from that session. Adrian Boulding of Legal & General, which I congratulate for having this kind of transparent operation, said to the Committee:

“We compete on price in the market place and we are able to do that because we have invested heavily in technology. If I look at pension schemes that we have sold this year, they have all been sold within a price range of 0.3% at the bottom to 0.8% at the top. 90% of them have been sold at 0.5% or less.”

Again, that is a range of figures that many people will struggle to understand. However, Mr Boulding went on to say:

“One of the particular features of our pitch to the market is that we charge just a single charge for the scheme, whereas some providers now want to charge £1.50 in addition to a fund management charge. NEST charges a contribution charged at 1.8% in addition to a fund management charge. Some insurance companies charge higher fund management charges when people leave the scheme. We charge a simple, straight fund management charge and it is the same for all members whether they are in the scheme or whether they have left, and there is only the one charge. We find that gives us an edge in the market place.”

It was interesting that a company specifically said that the simplicity of its charging—it only has a single charge—was its marketing edge.

What is included in the charge element of a pension fund varies, but the inconsistency in how charges are communicated is an additional complicating factor. In fact, the wide range of approaches is needlessly complicated. Some pensions are regulated by the Financial Services Authority and require an illustration of the effects of charges. Other pensions, mainly those that are trust-based, have no requirement for such disclosure. The stakeholder pensions were introduced in 2001 and I credit the previous Government for introducing something that provided some simplicity and clarity. Stakeholder pensions require disclosure of individual deductions.

The lack of comprehensive and consistent information prevents effective monitoring by the FSA, the pensions regulator, and, potentially, by the Department of Work and Pensions itself. We risk creating a regulatory black hole if we fail to create a clear communications framework. That is why there is also a need to specify which regulator covers which area and to define regulators’ powers to avoid market confusion over which regulator covers which issue—let alone confusion among consumers or among the employers that are implementing a scheme.

The approach taken by different pension providers and schemes also varies widely, as the National Association of Pension Funds has helpfully highlighted. Some providers quote an annual management charge as a percentage; others illustrate the effect in cash terms. Some present information in a personalised form, where charges are illustrated in a very varied way over different periods, whereas others provide information with a generic example. In some cases, the information is prominent, but in others it can be hard to find. In some cases, there are even charges for different parts of the process—for example, fund management prices can be shown separately.

We should compare the pensions sector with the banking sector, in which statements now clearly show what bank charges are on a weekly or monthly basis. The example of the banking sector is certainly one that the pensions sector should look at.

There is also financial jargon, which is unhelpful in any industry. If the range of charges and the communications about those charges are inconsistent, a pensions fog is created, and the impenetrable financial jargon that consumers must navigate has created a further consumer whiteout. In fact, I have used much of that jargon in my opening remarks today. I want to illustrate that point by giving two real-life examples, courtesy of the National Association of Pension Funds. They highlight how difficult it is for any consumer or business to understand what they are taking on with pensions. The first example is taken from a handbook provided to employees on a trust-based scheme. The handbook says:

“The manager’s charges differ according to the type of fund. The charges are made within the fund and are reflected in the price of fund units. With some funds, two unit prices are shown - the “bid” price, at which units are sold, and the “offer” price, at which units are bought; the difference - the “bid/offer spread” - reflects the manager’s dealing costs. The bid/offer spread on these funds vary.”

Then there is an impenetrable table listing six funds, showing for each one:

“a percentage annual charge on fund and a percentage bid/offer spread”.

Just looking around the Chamber now, I can see that Members are already somewhat glazing over with the difficulty of trying to understand what we ask ordinary people to understand in their daily lives.

[Richard Graham (Gloucester) (Con)]

I congratulate my hon. Friend on securing this debate on a really important topic and on building a strong case for transparency and clear communications. Does he think that the example that he has just given proves the point that Einstein used to make when he said, “If you can’t explain something to your grandmother, you probably don’t really understand it”?

[Brandon Lewis]

My hon. Friend has just summed things up with exactly the sort of clarity that we need in pensions charges, and I agree entirely with him.

Let me further enhance that point by giving another example, which is from a different type of scheme: a contract-based scheme. The quotation comes from a block of text headed “Additional expenses” that goes into a pension fund member’s handbook:

“Additional expenses such as trustees’, registrars’, auditors’ and regulators’ fees may be deducted from some investment-linked funds. In addition, where the [name of insurer] investment-linked fund links to a Fund of Funds (a fund that holds other underlying funds as its investments) the additional expenses may also include the cost of managing the underlying funds. Where these expenses arise within the fund they have been taken into account in the calculation of the unit price. Details of the Annual Management Charge and any Additional Expenses can be obtained from your [insurance company] Pension Pack.”

I assure Members that that is not an excerpt from a Monty Python sketch. It is, however, what people are having to deal with, and it is absolutely no wonder that consumers are confused and indeed suspicious of pensions when they are presented with information in such an opaque, complicated and almost incomprehensible fashion.

As I have already mentioned, many other financial products—such as mortgages and loans—now present information in a much clearer way, generally as a result of consumer pressure. I hope that similar consumer pressure will be brought to bear on the pensions industry.

It is rare for pension providers or schemes to show the actual cash amount of charges on an individual statement. Surely that would be the clearest way to provide vital information that the majority of people can understand. It is time to move away from a too long and too complicated explanation of charges towards greater clarity and understanding.

I have experience of being responsible for a company’s pension scheme. In that scheme, people had to contribute nothing themselves but they were given money by the company to enter the scheme. That money did not come from their salaries; it was money over and above their salaries. However, on far too many occasions, even educated people with degrees turned the scheme down. When we asked advisers why that happened, we heard on a number of occasions that it was because people simply do not trust the forms or the companies, and they do not want to get into filling in forms and giving things away. They do not understand that, as in the case of my former company’s pension scheme, it is about effectively trying to give them money; they still turn the money down. The system is so complicated that it puts people off, even people who are highly educated.

The problems that the system creates and the benefits of reforming it are what I will turn to next. The introduction of auto-enrolment next year will see between 10 million and 11 million extra employees being given access to a workplace pension. The Government’s aim is the provision of low-cost pension options for savers, yet consumers’ suspicion or wariness of pensions means that there is a risk of a high opt-out rate, which is something that we all obviously want to avoid. We must avoid exacerbating the problem because charges and their structure are difficult for people to understand.

Small businesses particularly face that problem. The complexity of schemes for businesses to choose from could risk disengagement by employers. At this point, I must congratulate the Federation of Small Businesses on considering establishing its own pension scheme. It understands that there is an onus on companies, particularly small and medium-sized enterprises, to do something. However, those SMEs are not only worried about the potential cost of auto-enrolment; in many cases, they see their staff as being part of a family. They care about their staff and want to provide the best for them, so they will want to ensure that they are making the best offer, the best investment and the best decision for their staff. They do not necessarily have the time to become involved with a range of pension providers but they know and trust the FSB, because they are members of it, so the idea that the FSB itself should have a brand of pension for SMEs to be part of makes a lot of sense.

For many businesses, independent financial advice will be unaffordable and, as I have just said, they will not have the time or expertise to cut through what can be a dense, even impenetrable, amount of financial information. Transparency can lead to better decision making on behalf of employees.

Much of our discussion today is about the information provided when someone joins a scheme, yet there is often scant information about what happens once they are involved in a scheme, as has already been touched on by Members. The lack of comprehensive information does nothing to reassure consumers, and it means that funds are under no pressure to demonstrate value for money and that much further down the line people can be in for a shock when they see where their pension stands, because of the charges. I agree with the sentiment expressed by Aviva, which said that focusing entirely on charges might be

“counterproductive and risks deterring a generation of new savers.”

In terms of what those charges are, I think that Aviva is right, and in terms of making sure that the charges are understandable, we still have an important job to do.

We need to see that charges provide value for money and flexibility, and to do that we need to see what the charges are in a way we can all understand. We need to see whether members can receive value for money if a charge is very low, because the very best pension fund operators might not see that as a viable option for their involvement. Although I want to see the lowest possible charges for consumers, to encourage as many of them as possible to invest and have the best return on their money, we also must ensure that they and their employers receive adequate and proper advice, otherwise it might be that only higher-end earners will get the advice they need and want—and, indeed, pay for. There needs to be an industry culture of charges reflecting the cost and value of the services provided, but providers must continue to find ways to offer better value for money, which means finding additional efficiencies, using new technologies as Legal & General has outlined, and improving processes.

I believe that providing clear financial information using a pounds and pence principle will exert sideways pressure on schemes to maximise value for money. Showing consumers and employers what the bottom line in charges is allows them more easily to compare schemes. With a whole range of products, whether it is high street banking and its charges or anything else we want to buy, we are generally able to go out into the marketplace and find an easy way to compare like with like, and decide if we want to invest in a more expensive or a lower-cost product. If we are looking for the latter, we can see the range of offers from various companies, understand them and make an informed decision about where to invest and what to purchase. With pensions, it is extremely difficult to find like-for-like offers, and when employers have a range of things to do, including running their businesses, this is one more thing that we must make simpler for them.

I have thus far focused on companies, and on information being given to companies that run schemes, but we must not forget the wide range of people out there who have personal pension schemes. There are people at the higher end who can pay advisers whom they trust to make the best decisions, but there are other consumers who have gone to the trouble of taking out their own pensions who are not necessarily at the highest end and able to pay high-value advisers. Nevertheless, they need good pensions, and they need to have faith in them and understand them. We need clarity and transparency so that end-users—consumers—can see what the cost of their pension is when they get their statement, not just when they first enter a scheme but potentially on an annual basis.

I want to turn to what the Government can do. What options are available to Ministers to create a new culture of charge transparency? I argue for a very light-touch approach from the Government. Their role in this transformation should be to guide, encourage and motivate the process, and resorting to regulation or further legislation must be a final option. The introduction of auto-enrolment will mean that the national employment savings trust will become the default option for many. Although we should welcome NEST’s role in pension provision, we must also remember that it is just another provider, and is neither designed nor suitable for everyone. I hope that its existence will assist in driving down charges across the sector, but its own charging structure is not a simple model and I am interested in the Minister’s view on how we can move that forward.

I hope that, even though NEST provides a low-cost option, Ministers will press for greater transparency across the sector, so that there will be benefits of transparency also for people for whom NEST is not the most suitable option. NEST will not necessarily attract higher earners or employees who require a larger choice of investment funds and greater contribution levels, but those people equally need greater charge clarity. NEST will not pick up many seasonal workers or low earners who fall below the threshold, many of whom could be women who work part-time due to child care issues, and we must do more to simplify and open up the system to give them an option to save, if only a few pounds each week. The system needs simplicity and clarity if it is to have a chance of encouraging a wider range of people to come into saving.

I am interested to hear from the Minister how he thinks the Government can encourage transparency, how he thinks charges can be set out clearly and in terms readily understood by savers, and whether he believes, as I do, that this approach should apply equally to contract-based and trust-based pensions, where there are currently no requirements for charges to be disclosed to savers. Will he also outline how his Department plans to provide guidance to consumers and employers ahead of the introduction of auto-enrolment? It is important that we take every opportunity to raise this issue and to clarify the matter.

Employers have a crucial role. They must be fully aware of the costs and charges associated with the workplace schemes for which they will effectively be responsible for their employees. In evidence to the Work and Pensions Committee last week, it was indicated that the code of practice, at least in the first period, will be aimed at giving clarity of evidence and information to employers, so that they can make decisions about the scheme for their staff, rather than directly to the end-user or consumer, and in the long term that will not be enough. We need the clarity and transparency to go right through to the end client. Legal & General has managed it, and we need to ensure that we get it across the sector. Will the Minister also comment on the suggestion by Which? that pensions should be benchmarked against NEST to assure value for money?

Several organisations, including Which?, have expressed concern about active member discounts, which are schemes that have a low charge for people who are actively contributing but in which the charge increases, often significantly, once someone moves job or goes on maternity or paternity leave. That issue was touched on in an intervention earlier. I have heard it expressed that this is more of an inactive member penalty, and should be seen as such. It is potentially one of the biggest issues facing pension costs, and it should be addressed. Again, it can particularly affect women who take a break from work due to child care issues, and low earners who can be out of work for periods of time.

I am particularly concerned about the increase in charges levied by some insurance companies for people who change jobs, and transparency can help to deal with that as well. Which? research has found that some companies have an annual management charge of between 0.5% and 0.7% for active members, but that once someone leaves a company the charge can double. Such high charges could have a big impact on the pension received by the consumer at the end of the scheme, with their pension potentially reduced by up to 25%.

Although I would like to see a commitment from the Government to clarify the governance and regulation of charges, I have mentioned the desirability of a light-touch approach from Government and the impetus for change must come from the industry. The National Association of Pension Funds has taken the lead in responding to the challenge to simplify the communication of charges. Earlier this autumn, it initiated an industry-wide discussion on the preparation of a voluntary code of practice on transparency of fees and charges, which resulted in the establishment of a working group to pursue that goal. I believe that only this morning the working group met to discuss how charges will be presented to employers in future, and I look forward to hearing about that discussion in greater detail.

That is exactly the responsible industry-led attitude that Minsters will be, and I am sure are, encouraging, and I hope that both Her Majesty’s Treasury and the Department for Work and Pensions are able to play an active role in the process. The heavy hand of further statutory regulation or additional legislation should be pursued only if this process fails or proves unsatisfactory. I hope that a new code of practice is agreed and adopted across the pensions sector by next spring, ahead of the introduction of auto-enrolment later in the year, but we must ensure that we are able to move gradually and, potentially, as quickly as possible to ensure that the clarity that is needed and that the industry is now working on developing can be provided not just to employers operating schemes but to end-users.

Although that step initiated by the industry and the NAPF is very good news, it is not the total solution. For that we need simplicity in the statements, to give clear figures to pension holders of the cost of their pensions on an ongoing basis, going right through to the end client and not just to the employer running a scheme. For consumers, employers and the pension industry itself it is vital that the Government clarify the existing regulation of charges and encourage that transparency. Failure to do so will risk a return to the mis-selling scandals of recent decades and a drain on the new auto-enrolment scheme as employees opt out of the scheme chosen on their behalf. Most importantly, it will risk a massive loss of consumer confidence, jeopardising the radical reform necessary to secure the future retirement of millions.

Across Departments and local government, we have found that the transparency agenda has had a cleansing action. Costs have been cut, people are more aware of what is going on and confidence can be rebuilt. It is the most cleansing initiative before us today, and Government have taken that on board. I argue that the pension industry should also take transparency on board as a way to clarify the issue to restore, rebuild and develop confidence in the pension industry, so that people will save more to provide for their future when they retire.

15:00

[Jenny Willott (Cardiff Central) (LD)]

I congratulate the hon. Member for Great Yarmouth (Brandon Lewis) on his comprehensive speech, which covered a wide range of issues. I think that we would all agree that transparency is generally a good thing, and he gave lots of good reasons why, including some apposite examples of the problems created by lack of transparency, which we have probably all experienced.

Following on from the points that the hon. Gentleman raised, I have a couple of issues to highlight. Transparency in itself is not necessarily enough. He mentioned the introduction of auto-enrolment and the fact that across the House, we all want more people to save and we want auto-enrolment to be a success. Part of that will involve transparency, ease of use and so on, but there are also financial implications. People’s take-home pay will be reduced at a time of difficult economic circumstances. We must overcome that and encourage people to understand that it is good to save for retirement. As he said, in some cases, free money is being offered to employees, yet they still do not take up the pension.

We need to overcome that significant hurdle in British society and get people to think more seriously about long-term saving. Part of that involves financial literacy and education. A lot of the problem is that people do not understand what they need to do, and as the hon. Gentleman said, they are bamboozled by a lot of the information that they receive. I am concerned that even with transparency about charges, which I support, people will still be confused if they do not understand what they are looking at. Many people do not understand compound interest or the compounding effect of charges; 0.8% sounds extremely small, but over the lifetime of a pension, it can be a significant amount of money. People simply do not understand what they are looking at. He is right that there might be many ways to present the information to make it more useful and practical in making a decision, but we must also ensure that people know what they are looking at and understand how it relates to the choices before them.

It is not just transparency of charges that is important but transparency about the range of different products from which people can choose and how their individual characteristics should inform the choice that they make. For example, as the hon. Gentleman said, are they male or female? Are they likely to take maternity leave or a career break? Are they self-employed, which might cause their income to rise and fall? Do they have a shorter life expectancy, for any one of various reasons? All those things affect what products are most appropriate. More transparency and more information are needed, so that people can make well-informed decisions about the best products for them.

We must also ensure that people are aware of the risks associated with different products, including charges and investment risk. Investment risk is often not explained properly, so people are not really aware of what they are signing up to. I have a couple of different random pensions—very small pots—from previous employment, as probably a lot of people my age do. I am not saving in them any more, but I get an annual statement telling me that I have lost a huge amount of money over the past year because the stock market has gone down.

Such information will not encourage people to save unless it is put in context and they understand the bigger picture and their long-term goal. We must ensure that it is put in context and that people understand all the different elements. A lot of that will involve education in schools to give people much better financial literacy at a much earlier age. A whole generation of people are going into employment who do not really understand anything to do with pensions, savings, debt, credit cards and so on. We must do much better. A lot of good work is going on in schools, but we must ensure that that is done as well as improving transparency, so that people know what they are looking at when they get better information.

I would like more transparency about the investment side of pensions, as that might encourage people to save. Foreign pension funds have been investing heavily in UK infrastructure during the past couple of years, but so far UK pension funds have not done the same. Moves are afoot to encourage them to do so, but a number of UK pension funds invest in less ethical concerns such as extraction industries, weapons manufacture and so on. That has an impact on people’s choices about whether to save and which company to save with.

If we had transparency about where money was invested, fund managers would have to provide more information, so that people could see where their money was being invested and possibly move it around, thus making better use of their consumer power to encourage fund managers to invest where people want them to invest. That could encourage more people to save, particularly young people. I have many students in my constituency. For a lot of young people, ethical investment is a big issue. If they are to sacrifice some of their salary and tie it up for many decades to come, they want to know that that money will be used for good while it is invested by other companies. Better transparency would let people know where their money is, so that they can see what is being achieved with the investment of the money that they are saving. That would encourage more people to save as well.

We must be careful not to make the situation worse. One reason why annual statements are so complicated is that there is an awful lot of regulation about what information must be provided. When people get the annual statement for their private pension, stakeholder pension or whatever, they get a huge pile of bumf that goes with it, including lots of models showing how much they will get if they retire at 65 and what will happen if they carry on saving at this rate or if the market goes to this or that level. It is all useful information, designed to help people be better informed, but it switches many people off because there is too much detail. In theory, it is helpful, but actually, it can be counterproductive.

I agree completely with the hon. Member for Great Yarmouth that we must be careful about light-touch regulation. We must not be too prescriptive and must not just lay on more regulation, saying that more information must be provided, making the situation worse. We all want people to be able to see what they are investing in and to save more for the future. We need transparency to make that happen, but it should be done proportionately, assist people to see what they are investing in and encourage them to put money aside.

15:08

[David Mowat (Warrington South) (Con)]

I, too, congratulate my hon. Friend the Member for Great Yarmouth (Brandon Lewis) on leading the charge. During his remarks, he distinguished between the need for transparency and the absolute cost. I contend—I will talk a bit about the absolute cost—that there has been a market failure in the UK pensions industry over the past two decades. That market failure is having a significant impact on the private sector propensity to save. Fewer than half of people working in the private sector now contribute to a pension fund. Transparency and cost are symptoms of the market failure.

To give some numbers, the Financial Services Authority estimated this month that some 31% of private sector pension pots go to fees. That is not surprising, because fees are, roughly speaking, 1.5% to 2%. Most pension funds aim for retail prices index plus 3.5% to 4%, so 50% of the real return is budgeted to go in fees. When things are difficult, as they have been over the past couple of years, the reality is that the figures are much worse, and absolute returns fall.

The real issue is that the private pensions industry is massively subsidised, and it would be hard to find an industry in the UK that is subsidised to the same extent. The Government pays something in the order of £40 billion a year into the industry to keep it going in the way that it has come to expect.

As I said, we have a chronic market failure, which has a number of unpleasant consequences, and I want to explore a little how that market failure has arisen. Principally, it is an issue of complexity; we have complete asymmetry of information between pension fund users and the funds themselves, and my hon. Friend gave a number of the excellent examples.

The consequence is that a whole industry of financial advisers has grown up to act as an intermediary between these complex pension funds and the average employee or punter. The difficulty, of course, is that the commission structure that was put in place has seriously compromised financial advisers’ independence. I congratulate the previous Government on what they did on the retail distribution review, and I hope this Government will push forward quickly to introduce it, because it is one of the things that must happen.

This market failure has also been caused by barriers to entry, which are a classic reason for market failure. Funds can charge fees of 1.5%, 2% or more in some cases because new entrants are not coming into the market with the velocity that we would expect. That, too, is to do with the industry’s structure, and it is for the Government to encourage changes. When I was reflecting on the debate this morning, I looked at one platform and found 5,000 funds were available to me. They were provided by something like 45 different suppliers. The industry has not consolidated, because it has not been forced to and it is not subject to commercial pressure. The consequence is that fees have been too high, with all that that means for the private sector take-up of schemes.

At the heart of this issue is a lack of transparency. Transparency can mean different things at different times, but there is a lack of understanding and comparability. Let me mention a number of the different charges that I know of, although there may be many others. There are annual charges, entrance charges and exit charges. A new one, which a number of companies are using, relates to churn. The average pension fund—this is an extraordinary statistic—has a churn rate of 128%, which means that it turns over the equities that it invests in by 128% in one year. That generates charges and income, and all that goes with that. Warren Buffett advises people to spend 10 to 15 years in an equity, and it is not clear why pension funds are churning to the extent they are, unless that is to generate revenue for themselves.

There is the new platform charge, but I will not go into that, given the time. I have not even talked about the way the charge structure for annuities works or the degree to which annuity advice is independent. The new super-charge has also come in. Companies are trying to get this trailing charge through before the RDR comes in, which is why we need to push ahead with it. Advisers are signed up for a trailing fee for many years into the future on the basis that they continue to have some kind of contact with the punter, even though about 50% or 60% of them never see the punter again. It is very difficult to bring transparency into such a charging structure and to provide for comparability, but we must try.

What are the consequences of this market failure? We can look at that in three ways: the consequences for the industry, the punter and the Government. This morning, I looked at Hargreaves Lansdown, which has about 500 employees, and the mean salary for one of its directors is £1.5 million per annum—nice business if you can get it.

What does market failure mean for the consumer? We have talked a little about that. Over the past 15 years, the average consumer in a private sector pension fund has had a return of 4.2% per annum. Broadly speaking, that is a bit better than the yield in the FTSE—that is the sort of return that consumers have managed to achieve after charges.

The consequence is that there is a massive lack of confidence in the pension industry. I know a lot of people who know that they should invest for the future and that they should put money aside, although they are in their 40s or 50s, so it is possibly too late. They do not do so, however, because they mistrust the industry. The fact that there is tax relief and that a lot of this money is free is lost because there is such distrust towards the industry, and I am not sure that people are totally wrong to feel like that.

The recent report from Lord McFall said that the median pension pot for a private sector person in their 40s or 50s is £35,000, which translates, even if built up, into a pension of less than £2,000 a year. Those are the consequences for the punter of this market failure, which has been caused by the lack of transparency.

The consequences for the Government are also pretty serious. We are getting an under-pensioned populace, despite the fact the Government are subsidising the industry to the tune of £30 billion to £40 billion per annum. Superimposed on that is the honest attempt to fix the problem with pensioning through the auto-enrolment scheme. However, that will actually result in a further subsidy and a further inflow of funds to the industry. Unless, it comes at the same time as reform, we will continue to see the current market abuse.

What should the Government do? We have talked about the need for simplification. As I listened to my hon. Friend’s examples, I was reminded of the debate we had in the main Chamber about the energy companies and the need for transparency on energy tariffs. We heard that it was not possible properly to compare energy tariffs because they were so complex, so people did not know when and when not to switch. Frankly, the situation before us is analogous, but arguably more serious, because the amounts of money involved are much greater.

My hon. Friend gave us some sensible ideas about simplification, and the Government should think hard about them. There must be a way of doing things more simply. The Government might wish to look at the experience in other European countries, because there are better markets and rates are lower in many of them.

I have talked about the need for the RDR to go ahead at speed. I would like to ensure that that happens and that the review is not delayed, as it has occasionally been rumoured to be.

The Government should think hard about a cap for the pension funds that are permitted to be part of the NEST system. Under the stakeholder pension brought in by the previous Government, there was a cap of 1%, with a cap of 1.5% in the medium term, and that is probably justified. When an industry is not operating in a free market because it is as heavily subsidised, as this one is, it is reasonable for the Government to think in those terms. Indeed, this does not sound like a very free-market solution, but most of the people who join auto-enrolment will need a very simple tracker fund based on the FTSE, and there are all sorts of ways that could be achieved. There are several funds in Europe with charges of the order of 0.08% for a thing like that, and I think that the Government might want to think about different ways to achieve it.

I have not talked much about annuities, but the problem with respect to the market failure in annuities is that 75% of people who purchase them buy them from their pension provider. There may not be anything wrong with that, if it is the best deal, but the truth is that there is a huge difference between good and bad annuity rates. The Government should require pension advisers to ensure that at least three different quotations are given before a customer can take an annuity from the provider.

I want to touch briefly on one other final cause of the market failure. I am a trustee of the House of Commons pension fund. It is clear to me as a trustee that there is a tendency to be quite conservative about things. The only downside for a trustee, in relation to the possibility of being in breach of trust, is the potential for doing something risky. Most pension funds should buy assets—buy shares—themselves. They should not do that through funds and lose 2%, but there is no incentive for trustees to act in that way. In fact, all the incentives are for them to act in the opposite way. I used to work in the IT industry, where people used to say, “No one ever got fired for hiring IBM.” Trustees have a similar characteristic, and that is a contributory factor to the market failure that I have talked about, which is causing so much difficulty now.

The Government have a big issue to deal with—I shall not call it a scandal—to do with transparency and practices that it would be reasonable to call anti-competitive. The country is under-pensioned, which will cause severe problems in the next four decades. There is a need to look hard, as a matter of Government policy, at getting confidence and zeal back into the industry, so I wish the Minister well.

15:22

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

I congratulate the hon. Member for Great Yarmouth (Brandon Lewis) on calling the debate. There is no doubt that costs and charges are one of the biggest issues in pensions. I welcome the fact that the National Association of Pension Funds called an industry summit on 23 November, to discuss transparency. However, as the speeches of the hon. Members for Cardiff Central (Jenny Willott) and for Warrington South (David Mowat) suggested, it is not clear that transparency in itself will be sufficient to tackle excessive costs and charges. In the past month and a half, I have spoken to many stakeholders in the pension sector, and I am grateful to them for the time and effort that they have put into those meetings. I am also grateful to them for the candour with which they described the industry’s situation.

The hon. Member for Great Yarmouth rightly raised the question of complexity. The focus on transparency is important; but I want to pose two or three questions or observations about whether transparency will be sufficient. First—I think that this was touched on by the hon. Member for Warrington South—even with greater transparency, some pensions are inherently complex. We might even say that they are brain-numbing. There is a complexity to them that is not apparent in some other financial services. It is worth emphasising the extent of the challenge that the Minister, the Government and the country face with pensions. Some of the figures have been mentioned already, and without going into the specifics, I think that we can say pretty straightforwardly that many people—more than 40%—are not saving anything at all. Of the rest—those who are saving—many are not saving enough, related to which is something that was mentioned a moment ago by the hon. Member for Warrington South: annuities. Annuity rates are pretty eye-boggling. We know the reasons for that: the downward pressure on bond yields and gilt markets, in particular, and longevity. However, when those issues are taken together, it becomes clear that the country faces a huge challenge in the pensions sector.

We know from the findings of Lord McFall’s workplace retirement income commission that there is poor transparency about costs and charges. Worryingly, Lord McFall found:

“Disclosure around costs and charges remains inconsistent across schemes and providers. What is consistent, though, is the opacity of that disclosure.”

I can only endorse the report’s recommendation. Lord McFall suggests:

“All schemes should be required to disclose costs and charges in a way that is transparent for consumers and which shows the cash impact of charges on the pension pot. The industry should develop a code of good practice on this issue and the government should monitor this and consider taking regulatory action if standards are not improved.”

So far, so good. I have in my mind the market failure emphasised by the hon. Member for Warrington South. The issue arises whether, as we go on, market failure will be solved even by something as worth while as a code of conduct.

The hon. Member for Great Yarmouth also mentioned active member discounts, and transparency about them would be beneficial. As he said, those discounts can better be described as deferred member penalties. Given the reality of the modern British labour market, in which according to Department for Work and Pensions figures the average person has 11 different jobs during their working life, the size of penalties imposed on deferred members is a key piece of information. The proposed costs should be highlighted and made clear. The consumer organisation Which? tells me that past and deferred employees may face charges up to three times higher than those for active members. In its estimation, that could reduce the value of those pensions by up to 25%. I accept that there is an administrative cost to pensions to which deferred members no longer actively contribute, but it is far from clear to me that the costs should be as high as they can sometimes be—for example, a recurring charge of 1.5%.

Transparency is clearly important in the context of auto-enrolment, because fees and charges will be critical if auto-enrolment is to be a success. The Minister knows that I am disappointed at the delaying of the timetable for auto-enrolment for small businesses. I look forward to hearing, sooner rather than later, what is to happen to businesses of between 50 and 300 employees.

There is a simple, wider point to make about the national employment savings trust and auto-enrolment: many employers that are engaging with auto-enrolment will be new to pensions and need clear and straightforward information if they are to pick the best value pension for their staff. In that context, I back another recommendation of Lord McFall’s workplace retirement income commission; this point relates precisely to something that the hon. Member for Warrington South said. Charge caps should apply to all schemes that will be eligible for auto-enrolment. The Government must not wait on market failure to act. It is simply too important that auto-enrolment should succeed, because the country faces a huge range of pensions issues. We must ensure that auto-enrolment has every chance of succeeding, and a charge cap on all schemes is important in that respect.

Auto-enrolment is aimed at a low-earning work force who have, largely, not so far contributed to pensions. As other hon. Members have suggested, that is partly because of a lack of confidence in pension products altogether. If we permit confidence to be damaged, because auto-enrolment does not succeed, many people could opt out, which would jeopardise auto-enrolment. There was some consensus about that from the hon. Member for Cardiff Central and the hon. Member for Warrington South. Once that opt-out happens, it is difficult to put the genie back in the bottle.

Greater transparency is an ambition on which everyone seems to agree, but I do not share the view of the hon. Member for Great Yarmouth—I hope I am not misrepresenting it—that transparency will be enough to ensure a fit-for-purpose pensions industry. There is some consensus that a long-standing industry in which the market has not already required transparency of market providers is likely to have a structural problem. The absence of transparency in our pension costs and charges is likely to be a symptom of the problem, not its cause. First, we have inherent complexity, even with transparency. Secondly, we face a challenge in relation to the number of people who do not save and the even larger number who do not save enough. Thirdly, and more widely, returns on pension contributions are an issue.

The hon. Member for Cardiff Central has emphasised the importance of financial literacy. I have had many discussions with the industry and stakeholders, who emphasise that such literacy is beneficial. I cannot imagine that anyone is against greater financial literacy, but I reiterate that, even with financial literacy, pensions remain complex. It is worth conducting a thought experiment: what would an enlightened and informed British consumer and voter observe of the UK pensions world? I suggest that they would observe that there is a big difference in costs and outcomes between UK defined benefit schemes and defined contribution schemes, even where the sums paid in by employer and employee are comparable. Historically, that may have mattered less when DB schemes were in the ascendancy. It matters much more now that DC and, in particular, contract-based DC schemes are becoming such a significant part of provision.

If the enlightened and informed consumer—this point has already been touched on—were to look around the European Union as a single market, as it encourages us to do so, he or she might be surprised to find that annual charges could be as low as 0.04% a year for an occupational pension provided by ATP in Denmark. The enlightened and informed consumer-voter could hardly fail to be pretty unhappy if he or she were contributing to a UK contract-based DC scheme in the knowledge that they could make the same contributions as someone else but receive thousands of pounds less per year in income than someone in the Danish scheme. I am told by some people that there is no issue concerning charges in the UK, because many are less than 1% per annum. That may be true, but there is a big difference on a compound basis between an annual charge of 0.3% and one of, say, 0.7%. Our very best practice is therefore still much worse than the Danish best practice.

The structure of the UK pensions industry impedes it from responding effectively to consumer unhappiness, and that unhappiness has been powerfully articulated by other Members. However much it might wish to do so, the industry cannot respond, because of the structure. Scale is important in that regard. We need a scaling up of the pensions industry, but there are two major impediments to acquiring scale in DC provision. It is worth pointing out that the UK has a striking number of pension fund providers compared with Europe as a whole and that disaggregation is significant in terms of structural impediments. The first major impediment is that the law impedes the creation of super-trusts or collective DC schemes. The second, I am sometimes told, is that employers and employees might be reluctant to move to collective DC schemes.

Defined contribution is where the action is increasingly at. There is a consensus, I think, more or less across the board that DB schemes, while still of great importance to those who are enrolled in them, will be of less significance than DC schemes in future. The question is about how to make DC work better.

The Government can remove the first impediment in relation to the creation of super-trusts and the legal framework. The Minister has talked favourably in the past about re-examining the case for super-trusts and collective DC schemes. I strongly encourage him to do so.

On the second impediment, some tell me that employers want to retain pension schemes that are clearly linked to each of them alone and are not shared—that is, not collective DC. That is not the view of the National Association of Pension Funds, which has supported super-trusts, nor is it mine. I am sceptical of the view that, if a firm has opted for a contract-based DC scheme, it will be opposed to collective DC. After all, it will already have opted to move away from maintaining a fiduciary relationship. In any event, that is an argument not against making collective DC or super-trusts available, but for ensuring that there are other options.

It has been suggested that employees would not be in favour of collective DCs, because they prefer schemes where they obviously do not share risk. Again, I am sceptical. I suspect that, on average, the informed and enlightened consumer, if invited to choose between the stone-cold certainty of losing a large chunk of his or her pension pot—as is often the case at the moment—and only possibly running the risk of losing some of it, would tend to prefer the latter. The largest known revision from target income from a collective DC scheme, as far as I am aware, occurred in the Netherlands and was roughly 6%. That is a lot lower than some of the figures suggested for losses to pots purely for being DC.

In summary, I welcome moves by the industry to make charges and transparency clearer, which is a good thing that I do not think anyone would oppose. These moves must succeed; otherwise the Government will have to act, given the scale of the challenges facing our country as we all look at saving for our retirement. On those who wish to make offers under auto-enrolment, some minimum standards on costs and charges should be set now, because we cannot afford any failures. Overall, I think that the transparency issues are symptomatic of an industry that is currently constrained by legal impediments from responding to potential demand. Simply put, at present, British law does not permit the creation of collective DC schemes. We should deal with that underlying impediment.

We should all share a sense of urgency. The Minister is well aware of this—I do not need to tell him—but I reiterate that the scale of the challenges that we face in the pensions field is enormous. If we do not get it right, starting with auto-enrolment, followed by lowering costs and charges in the pensions field, the burden will ultimately fall on the state. To avoid that burden, the Government have to act, and act quickly.

15:38

[The Minister of State, Department for Work and Pensions (Steve Webb)]

There is a risk of an outbreak of violent agreement in this debate, but I will do my best to sow some dissent, if I can. I congratulate my hon. Friend the Member for Great Yarmouth (Brandon Lewis) on securing the debate. It is good to see a number of hon. Members present and happy to spend 90 minutes discussing transparency in pension fund charges. Although it may be thought of as a dry subject, it is, as we have heard from a number of contributors, fundamentally important to the pensions outcomes of so many of our constituents. I am, therefore, grateful not only to my hon. Friend for securing the debate, but to all hon. Members who have participated in thoughtful ways.

I was struck by my hon. Friend’s examples of baffling language. On the first pension I ever had, I remember having to choose whether I wanted it to be “with profits” or not. I thought, “Profits must be a good thing, so I’ll have one of them,” but I did not have a clue. I worked for the Institute for Fiscal Studies at the time, so I may have been thought to have a clue, but I had no idea what it was. In fact, I am still a little bit hazy about it, but I do not have it any more.

It is absolutely clear that. although people get information, it does not inform. As my hon. Friend the Member for Cardiff Central (Jenny Willott) said, although one can get a wodge of stuff that complies with all the necessary regulations, it might not actually communicate anything at all. I agree with her that financial literacy is an important part of the jigsaw. She may have been encouraged to hear the Prime Minister say at Prime Minister’s questions that he will look at the research the all-party group on financial education for young people is doing. There is clearly some momentum behind that campaign in the House, which I certainly welcome. However, I think she would be the first to admit that financial literacy is only part of the jigsaw.

One of the crucial things about pensions is that we need to make them work for people who do not engage. In other words, most people will find the subject boring or off-putting and we need to ensure that their interests are protected. A phrase in the behavioural economics and pensions lexicon is, “You can’t beat a good default.” That is significant in the context of auto-enrolment because, by the end of the process, we will take firms that are not interested and give them a legal duty to choose a pension. It will not be the employer’s pension; it will be the employee’s pension. Therefore, the firm may have a limited incentive. It may care about its workers, but there may be a limit to how far it wants to go.

As we have heard, there may be employers coming into auto-enrol that are less educated, less interested and less well informed. When we discussed these issues in the Committee that considered the Pensions Bill earlier this year, one hon. Member—I think it was the hon. Member for Islwyn (Chris Evans)—asked what happens when a man in a shiny suit turns up. For example, he might turn up at a small engineering firm in the west midlands that employs three people and that probably did not even know it had a legal duty to auto-enrol—we have done our best, but it may not have heard—and say, “You’ve got to do this thing. I can do a scheme. Here are the terms. Sign here.”

There might be a tendency for such a firm to go for that. The question then is: who is looking after the welfare of the employee, because the employee will almost certainly end up auto-enrolled into a default fund? We need to make sure that the employee, who may not be engaged with pensions either, is protected. Transparency is a part of that. Individuals must get the relevant material, so that they know what they are paying. However, the employer has chosen the scheme. Happily, we are still on the eve of auto-enrolment, so we need to make sure that, first and foremost, employers have transparency. When employers are establishing auto-enrolment schemes or choosing schemes that are already running, they will therefore know what they are choosing between in a simple and consistent way.

I very much welcome the work of the National Association of Pension Funds that has been cited by a number of hon. Members. I am delighted that it is bringing together industry players, such as the Association of British Insurers, many of whose members offer contract-based pensions. We are therefore getting a spread across the breadth of pension provision. If that group and that work can produce an effective industry code of practice on transparency on charges, so much the better. I entirely agree with my hon. Friend the Member for Great Yarmouth that, if the industry can sort its own house out—it has not done so yet and there is some recognition of that—it is far better than the Government trying to be over-prescriptive. We need to ensure that we can get to that point quickly. I am pretty sure that, if the ABI, the NAPF and others get their act together and sort it out, they can move a lot faster than the Government. If an industry code of practice is in place before auto-enrolment starts, that will be very positive.

A number of hon. Members referred to the important issues of active member discounts, deferred member charges and deferred member penalties. That is a good example of transparency, or the lack of it. Someone might have left a firm years ago and still have some money with it. As my hon. Friend said, they might receive a statement, but they probably do not understand it. It is not apparent what is happening on charges and it perhaps did not even occur to the person concerned that, now they have left the firm, the charges are higher than they were when they were with the firm. Again, transparency gets us only so far.

One of the things we as a Government need to do, particularly post auto-enrolment, is to look at the whole issue of transfers. As the hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East (Gregg McClymont)—I discovered the other day that that is the longest constituency name in Parliament—said, people might typically have 11 different jobs and acquire multiple small pots during their lifetime.

We could just do transparency. We could make sure that people know what pots they have got and what charges they are paying. However, a better strategy in my view—or certainly a better first step—would be to consolidate all those small pots, so that people are not left with stranded pots that they might never access at all because the firm has lost touch with them. We know that that happens because we hear from pension fund trustees who cannot find their members anymore. I do not know, Mr Gale, whether when you have moved house, you have told all your pension providers of your new address, but many people fail to do so. Therefore, many people end up with stranded pension pots because the providers have lost contact with them or because the pots are so small one could not buy an annuity with them and the charges for transferring them out are so large as to not make it worth while.

One can start to see how individuals who are just the sort of people who might be under-pensioned will get a bad deal. Therefore, transparency takes us so far, but much more action on transfers could take us a lot further. Hon. Members will be encouraged to know that, very shortly, I hope that we will be publishing a document setting out some options on how we might make transfers work. It is code-named “project big fat pot.” The idea is that we bring together all the small pension pots people have. In an auto-enrolment world, that really matters because we estimate that hundreds of thousands of small pots could be created every year. Such pots belong to people who are auto-enrolled, leave the firm and move on. We need to ensure that that process of accumulation of pots is as systematic and automatic as possible.

We will set out options. I say to the shadow spokesman that we are very much in listening mode on this and that, if he has insights and thoughts on our consultation, we will be pleased to hear what they are and to meet him to discuss them. One option is that the pot should follow the person. So if someone changes jobs, by default, the new firm says, “Right, we’ve auto-enrolled you. You have just come from another scheme. Unless you tell us not to, we will take the money into the new scheme, so you consolidate into the new scheme.” That is quite attractive but, on the other hand, such an approach raises issues around member protection if someone goes from “a good scheme” to a “not so good scheme.”

An alternative option would be that, by default, small pots go to a third-party aggregator—a third-party pot. That could be the NEST, another provider, a multiple set of providers or a super-trust. There is a variety of options. Again, that will mean someone does not end up with stranded pots and deferred member charges; they will just end up with a big fat pension pot, as far as they can.

That brings me to the point made by my hon. Friend the Member for Warrington South (David Mowat) about value for money. My rule of thumb on people buying annuities is that a third of people shop around and switch, a third of people shop around and stay with their provider, and a third of people do not shop around. If we can accumulate small pots into big ones, that will ensure people are getting better value for money and better annuity returns. However, he is absolutely right: transparency and information for people when they are making their annuity choices is vital and getting as close as we can to turning defaulting into shopping around has got to be the direction of travel.

The Association of British Insurers has taken some important steps in that direction recently. For example, if someone has saved with company A and, six months before they are due to draw their annuity, it contacts them, the ABI is making it a condition of membership of the ABI that the provider does not send the application form that is easy for someone to fill in and send back, meaning they end up with company A. Someone has to actively seek that out. That is a small step, but it is a step in the right direction.

We can do more and the Financial Secretary to the Treasury will be announcing further measures on that shortly. We need to ensure that people see what the charges are but, better yet, we need to try to ensure that people are not in a position where they face these charges. Instead, they should have the money somewhere they are connected to, rather than somewhere they left a long time ago. That would be an appropriate response.

There has been talk during the debate about NEST. It is encouraging that NEST has already driven up standards in the industry. In focusing on its target market, which includes people on lower incomes and people who have not been pensioned before, NEST has had to think very hard about language and communication. It has come up with a lexicon of phrases and the use of words such as “vesting” has been ruled out. That word cannot be used because nobody knows what it means. Unfortunately, the word “pension” is also a bit tricky as nobody knows what that means either. I think NEST calls a pension a retirement wage or something. I have a branding problem with my own job. I have asked the Prime Minister if I can be called the Minister for retirement solutions or something like that.

There is a serious issue surrounding the communication of pensions. NEST has led the field. Others are working with it and we, as a Department, have a working group on communications that involves a lot of the industry in trying to ensure that all of us are speaking human rather than pensions. That is vital in the context of auto-enrolment.

I do not know whether the shadow spokesman has had a chance to visit NEST yet, but we extend an invitation for him to do so. [Interruption.] Next week—there we go. My hon. Friends on the Select Committee visited and came back pretty impressed with what NEST is doing to drive up standards of communication, which is really important, and standards of transparency on charges, and to bring charges down.

I will say a word about the NEST charging structure in a second, but perhaps slightly contrary to what my hon. Friend the Member for Warrington South said, the evidence in the auto-enrolment space is that charges are coming down. He raised the issue of entrance to the market. We see growing competition—auto-enrolment is a big market; 10 million people will be auto-enrolled—new people coming in and charges coming down. For example, the B&CE organisation has branded itself as the “people’s pension”—I will not comment—with an annual management charge of 0.5%. NOW: Pensions, which is linked to the Danish providers, has a different structure at £1.50 a month, I believe, and a 0.3% charge. My hon. Friend the Member for Great Yarmouth mentioned the Federation of Small Businesses, which I believe is coming in with charges below 1%. There is NEST. We have heard about Legal & General, obviously an existing provider, but one that is working proactively in the market. I am encouraged that, in the early phases of auto-enrolment, I do not think that we have a problem with charges. I stress that—in the early phases I do not think that we have a problem. On the whole, we are dealing with the huge employers—the big supermarkets and some of the public sector. They have people spending time and effort shopping around. They can drive a hard bargain. They are engaged with pensions—I do not think that we have a problem there.

The challenge for Government is further down the track, as we get towards the medium and smaller firms that are clearly less profitable for the providers. We hope that many will go to NEST. When the pensions regulator writes to them a year out, we will flag up NEST. We will say that we have created NEST and that it is designed specifically with them in mind, and that they should have a look at it. There is a risk, however, that people will go to other providers and end up with high-cost providers. That is why we are looking at the issue of charge caps. In the debate, we heard two competing views on that: the call for charge caps, and the view that we should go for light-touch regulation and charge caps as a last resort. That is the dilemma we face.

It is only fair to say that charges are paying for something. In a transparent world, there may be a case for what looks like a high pension charge if people get something for it. I use the analogy that if all someone wants is vanilla then that is fine. We might say that vanilla ought to be cheap. If someone wants raspberry ripple, we might let them pay a little bit extra for it. We do not necessarily want to say that it is evil to charge more than a certain amount for a pension, but people should certainly know what it is they are paying and know what they get for it. For example, if someone is offering a sophisticated or niche investment, they should be able to charge for it, as long as we know what it is. The focus of our attention on charges is particularly on the area of default funds, because those will be the ones where people have made no active choice, where they have just been lumped in, and we need to ensure that people are protected.

[David Mowat]

I hear the Minister’s analogy of vanilla versus raspberry ripple. Raspberry ripple is analogous to actively managed funds. Remembering that those funds are heavily subsidised and paid for by a lot of Government money, is it his assessment that actively managed funds give value for money in the industry, and have demonstrated that they have been clearly better than tracker funds in the past decade or so?

[Steve Webb]

I suspect that the arguments over the merits of active management against passive trackers and so on are food for longer than a seven-minute debate, and are the source of much contention. The point that I am making is not so much that one or other is good or bad, but that we want individuals who make active choices. They can have a knickerbocker glory if they like. They ought to be able to choose as long as they know what they are getting, and can make an assessment on whether they are getting value for money. The worry we have is that, if people end up defaulted into something, they do not know what has been done to them, do not make any choices and potentially find that a big chunk of their money is going in charges. In such circumstances, the case for action is stronger.

That is not straightforward, however. What is a charge? My hon. Friend the Member for Great Yarmouth listed a whole raft of different things that can be mentioned in the course of setting out charges. Do we just cap an annual management charge? If so, what about transactions charges and sales charges? The danger is that, if we cap a bit of the charge, we squeeze the balloon and it just comes out somewhere else. It is easy to say, and I have said it, “Oh, we just cap charges.” Actually doing it and defining charges is less straightforward than one might imagine.

In the few minutes available to me—I believe that a Division in the House is imminent—I would like to pick up on the scale of the deferred member charges. For group personal pensions and stakeholder pensions, where one of those deferred member premiums is charged, our survey evidence from 2010 is that for active members we are typically talking about 0.6% as an AMC, but for deferred members an average of approximately 1%. These numbers vary a lot, but even that, as we have heard, cumulatively is a big chunk out of people’s pensions and something that we want to do something about.

To clarify the NEST charging structure, it has a contribution charge of 1.8% and an AMC of 0.3%. It is structured like that because NEST was started from scratch and so has to borrow money to start at business. It has to set up and be all in place before the first pound comes through the door some years later. The Government lent NEST that money on favourable terms because of its public service obligation. The 1.8% contribution charge reflects the Government loan. When that Government loan is paid off, the 1.8% charge will go. Having said that, it will be quite a number of years before it does: it is not permanent, but it is not short-term. It will be with us for some years, but that is why the structure is as it is. The 1.8% contribution charge and 0.3% AMC average out at approximately 0.5%. We are finding that the market is now coming down to about that level.

On charge caps, people sometimes say that, if there is a charge cap, the danger is that everybody goes up—the maximum becomes the minimum. I do not think that that will happen in this case, because we have NEST in the market. We are making sure that NEST is at a certain level, so charging could not be sustained at a much higher level. Therefore, I do not think that the argument against charge caps actually holds.

We heard a number of other points during the debate. My hon. Friend the Member for Warrington South referred to a £40 billion subsidy. That depends on how we look at it. Tax relief, fundamentally, is avoiding double taxation. If I earn some money, pay tax on it and then invest in a pension out of my post-tax income and am then taxed on my pension, that will be double taxation. We give tax relief on the pension contribution. Leaving aside the issue of higher rate relief, which is a different issue, someone who is on a standard rate of tax when they earn the money and a standard rate of tax when they draw the pension is being taxed once. I do not count that as a subsidy of the pension industry; I just count that as not double taxing people. There is a bit of an issue about higher rate relief, particularly when people retire on a standard rate, but I do not think we subsidise the pensions industry—that is not the way I would view it.

My hon. Friend raised an important point about comparability. We know that swapping energy tariffs, as he says, is a real challenge. As soon as someone has changed energy supplier, they can often jack the charges up. It is less straightforward at least with pension providers, because if someone signs on to a contract there are terms and conditions on whether they can subsequently be changed. It would be a good thing to get that transparency in place.

Drawing some of these threads together in this very important debate, I welcome the Select Committee’s inquiry, and the work it did recently in questioning witnesses. I welcome the lead that the NAPF is taking on this issue and the fact that it is bringing industry players together. A new industry code of practice would be an important step in the right direction. The Government may well have a role. We will certainly work closely with the NAPF and the industry to support that work. At the same time, we are looking at the role of charge caps and whether they have a part to play in auto-enrolment. We do not anticipate the issue of charges being a big problem in the short term. The scale of the market early on is a small number of big buyers who are relatively well informed and relatively well resourced, so we think that that will work well, but we are actively considering whether we need to go further. We all want to protect individuals and ensure that, of the money that goes into their pension, far more goes out in the form of pensions. That, I think, is a goal we all share.

Tibet

Wednesday 7th December 2011 Westminster Hall

15:59

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

Thank you, Mr Gale, and thank you to Mr Speaker for choosing this subject—in Tibetan, thuk-je-che: thank you.

At this time of year, we can probably have no debate more appropriate than one about Tibet, given that United Nations human rights day is commemorated this coming Saturday, 10 December. I am grateful for the opportunity to raise an issue that has often been a subject of debate in this House.

As I have declared in the Register of Members’ Financial Interests, two months ago, at the beginning of October, at the invitation of the Tibet Society and the Tibetan Government-in-exile, I went to Dharamsala in India with the hon. Members for Leeds North East (Fabian Hamilton), for Scunthorpe (Nic Dakin), for North Wiltshire (Mr Gray) and for Kilmarnock and Loudoun (Cathy Jamieson), all of whom I am happy to call my hon. Friends. The five of us spent four informative days together in Dharamsala, during which time we were privileged to meet His Holiness the Dalai Lama, other people in the Tibetan Government-in-exile and many others.

The reason why the debate is as appropriate as ever is that, sadly, in recent weeks there has been an outbreak of self-immolation—suicide—among nuns and monks in Tibet, and it has caught the attention of the world. This year, on 31 October, my hon. Friend the Member for Leeds North East tabled early-day motion 2327, expressing great sadness at the disturbing news of 10 incidents of self-immolation in eastern Tibet by young Tibetan monks, former monks and a nun. Since then there has been a further death. Those people, in monasteries mainly in Ngaba in Tibet, have been setting themselves alight as a protest against their inability to express their faith and their allegiance to His Holiness the Dalai Lama. They have drawn the sympathy of the world.

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

Will the right hon. Gentleman give way?

[Simon Hughes]

I will in a second. I am grateful to see the hon. Gentleman in the Chamber.

On 25 November, a letter in The Guardian from Dai Qingli of the Chinese embassy was headed “Tibetan deaths violate Buddhism”. The argument of the letter was that the deaths were a fatal violation of the spirit of peace and tolerance that defines Tibetan Buddhism. I am grateful that hon. Friends from a number of parties have joined me in replying to that letter in today’s Guardian:

“Dai Qingli’s letter…revealed not only a woeful lack of comprehension of the crisis in Tibet but also the Chinese Communist party’s failure to gain any measure of legitimacy among the Tibetan people after more than 60 years. Since February 2009, 11 Tibetan monks or former monks and two nuns in Tibet have set fire to themselves in a new and disturbing development driven by agonising oppression. It is a terrible indictment of China’s Tibet policy…Contrary to Dai Qingli’s claims, the Dalai Lama and other religious leaders in exile want these deaths to stop and Tibetans to be able to practise their religion and protect their cultural identity. Dai Qingli is wrong, too, on his paranoid assertions of a separatist agenda of the Dalai Lama; the exiled religious leader is urging the Chinese government to implement its own laws granting Tibetans a genuine autonomy within the People’s Republic of China. It is in the interests of the Chinese leadership to listen, instead of risking the further escalation of tensions, and to engage in dialogue with this most-respected and reasonable figure, the Dalai Lama.”

[Jonathan Edwards]

I congratulate the right hon. Gentleman on securing the debate and on his consistency in his work on this important issue. He referred to those serious incidents of self-immolation. Does he agree that it would be appropriate for the UK Government to make a statement outlining their position on recent events and on how they aim to pursue the matter with the Chinese Government?

[Simon Hughes]

I am grateful to the hon. Gentleman. He and his party have always been good on the issue, which has united people throughout the parties and the United Kingdom. I have had the privilege of meeting His Holiness three times in this country and the Tibetan peace garden, which he opened on a previous visit, is in my constituency—in the grounds of Geraldine Mary Harmsworth park over the river from Parliament.

I appreciate the presence of the Minister, the hon. Member for North West Norfolk (Mr Bellingham), and hope that he can give a positive response to the request made not only by the hon. Member for Carmarthen East and Dinefwr (Jonathan Edwards) but by all of us together.

I have not been to China, other than to Hong Kong when it was still under British rule, although I would very much like to go. I have therefore not been to Tibet, although all my life, since I was a little boy—I just about remember the uprising in Lhasa, the Chinese invasion and the flight of the Tibetan people from Tibet—the country has mattered to me and to many in the UK.

Not surprisingly, in 1959, the same year as the uprising, the Tibet Society was formed in this country to argue the case for the proud and historic nation of Tibet and its people and for their rights to be upheld. I pay tribute to the Tibet Society, which has done consistent and effective campaigning work, and to its president, my hon. Friend the Member for Lewes (Norman Baker). I also pay tribute to its chair, Ricky Hyde-Chambers, who is a constituent of mine, and to its chief executive, Philippa Carrick. With their staff, they are a really effective team. They supported us in our visit to Dharamsala this year and have done so at other times in the past.

I want to come to history and politics in a second. When we were in Dharamsala, we were privileged to meet the new Kalon Tripa. This year, for the first time, His Holiness the Dalai Lama announced that he would give up all political authority, while retaining spiritual authority. There was an election among Tibetans worldwide and, on 8 August, Dr Lobsang Sangay was elected as the new political leader. We had the privilege of welcoming him only recently, as part of his tour of Europe and the States; he had been living in the States, but is now back in Dharamsala.

An important issue for our country is to keep in constant dialogue with such elected representatives, who are enlightened and engaged in their international contacts. I salute them, together with His Holiness, for what they have done already. In a way, we are in the Chamber to pledge our commitment to go on and to work better with them.

I do not pretend to be a great historian of China or Tibet but, put simply, Tibet has a proud independent history. We can argue whether it was completely independent but it was perceived as effectively independent by the British, who have had a particular link over the years, especially in the previous century. It was only in 1959, after the Chinese invasion, that the people of Tibet turned their loyalty to the Dalai Lama, who had to flee the country. They have remained loyal to him.

All the evidence is that the overwhelming majority of the people, not only in what the Chinese call the autonomous republic of Tibet, but in greater Tibet, which goes beyond what the Chinese recognise, have an independence that is both ethnic and cultural, in language and in faith. It is one that they want to be able to exercise. The present view of the Dalai Lama, which he has held for many years, and of the Tibetan Government-in-exile, is not that they want total independence—they are not making that argument—but that they want to have the autonomy that already exists in other parts of China.

For example, Hong Kong and Macau have a certain autonomy, which was negotiated, and parts of mainland China have a certain autonomy. The Tibetan Government-in-exile are asking for that autonomy, as well as for the freedom not to be told how to live their lives, how to worship and who to worship, and how to go about their own cultural activities.

[Nic Dakin (Scunthorpe) (Lab)]

I am pleased to serve under your chairmanship, Mr Gale. I also declare my interests set out in the Register of Members’ Financial Interests.

The right hon. Member for Bermondsey and Old Southwark (Simon Hughes) is clearly outlining a difficult situation in Tibet. Does he agree that in all the representations from Lobsang Sangay and the Dalai Lama there is clarity about the desire for a peaceful settlement, and recognition that everything that can be done to cease the troubles in Tibet, particularly self-immolation, should happen peacefully? People are being urged to cease those terrible events in Tibet.

[Simon Hughes]

Not only—[Interruption.] I welcome my hon. Friend the Member for Kilmarnock and Loudoun, who was with us in October.

Not only is my hon. Friend the Member for Scunthorpe right about that, but the whole ethic of Tibetan Buddhism is peacefulness, non-aggression and non-violence. That is why it is such a terrible indictment of the Chinese regime that it will not allow those peaceful people to express themselves in their peaceful way. I have nothing against China and its people; I represent one of the largest Chinese communities in this country. That is not the issue. The issue is how the Chinese behave at home towards that different group of people in its territory.

Over the years, a number of colleagues have persistently raised the issues here, and I pay particular tribute to the Under-Secretary of State for Transport, my hon. Friend the Member for Lewes, who, when he was not a Minister, was able to raise these matters. He did so in March 1999, on the 40th anniversary of the 1959 uprising; on 28 June 2005, just ahead of the EU-China summit, which was under our presidency; and on 1 April 2008, when he opened by saying that he was angrier, sadder and less hopeful then than ever before.

That was before what was probably an understandable, but in the end rather unhelpful, clarification of policy by the then Foreign Secretary. It was not well received in Tibet. Whatever our politics and understanding of how we want to build and cement links with China, the fact is that the then Foreign Secretary said:

“Our ability to get our points across has sometimes been clouded by the position the UK took at the start of the 20th century on the status of Tibet, a position based on the geopolitics of the time. Our recognition of China’s ‘special position’ in Tibet developed from the outdated concept of suzerainty.”

He hugely disappointed people among the Tibetan community in exile and in Tibet when he then said on behalf of the then Government:

“We have made clear to the Chinese Government, and publicly, that we do not support Tibetan independence. Like every other EU member state, and the United States, we regard Tibet as part of the People’s Republic of China.”

The statement was, of course, more balanced, because it went on to say:

“Our interest is in the long-term stability, which can only be achieved through respect for human rights and greater autonomy for the Tibetans.”—[Official Report, 29 October 2008; Vol. 481, c. 30WS.]

I pay tribute to the fact that Ministers have gone on arguing that case under the Labour Government and the present Conservative-Liberal Democrat coalition Government. I also pay tribute to the Minister of State, my hon. Friend the Member for Taunton Deane (Mr Browne), and to the Minister on the Bench, as well as to the Foreign Secretary, who has been robust about human rights issues.

I want to take the Chamber to where we might go. Many hon. Members have persistently expressed their concern. A litany of colleagues on both sides have asked questions, including, from the Conservative party, my right hon. and learned Friend the Member for Kensington (Sir Malcolm Rifkind) and my hon. Friends the Members for Banbury (Tony Baldry), for Esher and Walton (Mr Raab), for Gillingham and Rainham (Rehman Chishti), for Oxford West and Abingdon (Nicola Blackwood), for Tewkesbury (Mr Robertson), for Ealing Central and Acton (Angie Bray) and for Witham (Priti Patel); from the Labour party, the hon. Members for Bassetlaw (John Mann), for Vauxhall (Kate Hoey), for Hampstead and Kilburn (Glenda Jackson), for Worsley and Eccles South (Barbara Keeley), for Islington North (Jeremy Corbyn)—he is in the Chamber—for Wolverhampton North East (Emma Reynolds), for Leeds North East, for Glasgow North East (Mr Bain) and for Scunthorpe, all of whom I am happy to call my hon. Friends; and from the Liberal Democrat party, my right hon. Friend the Member for Carshalton and Wallington (Tom Brake), my hon. Friend the Member for Cambridge (Dr Huppert) and my hon. Friend the Member for Cheltenham (Martin Horwood). There is a real desire in this place to try to make progress.

I want to end by making some suggestions to the Minister on ways in which we might be able to take on the debate and to influence the outcome. We must try to persuade the Chinese that it is in their interests to deal with the issue because it clouds and affects all the perceptions of China in the democratic world.

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

When we spoke to Tibetans in exile, we heard that they believed that if ordinary people in China had the information, many of them would take a different view of what should be happening. Does the right hon. Gentleman agree that the same applies to the Chinese community here? I wonder whether work should be done to engage with various key people in the Chinese community in the UK.

[Simon Hughes]

My hon. Friend is absolutely right. The Avaaz petition, which today has 665,260 signatures, says:

“People from all over the world call on you to: investigate and stop the Tibet crackdown”.

It says to our Prime Minister:

“A rising number of Tibetans are taking their lives through self immolation in a desperate cry to the world to stop the escalating Chinese crackdown. As shocked citizens, we call on you to urgently send an independent high-level mission to the area…to speak out against the ongoing repression. Only coordinated and swift diplomatic action can stop this crisis.”

I am sure that both at home and abroad people of Chinese origin share exactly that view. Sadly, many of them in China do not know what is being done in their name.

[Jeremy Corbyn (Islington North) (Lab)]

Will the right hon. Gentleman give way?

[Simon Hughes]

I will give way once more. I am conscious that the Minister needs time to respond.

[Jeremy Corbyn]

I apologise for only having just arrived. The right hon. Gentleman has taken this case up many times, and I congratulate him on that. Does he agree that it is deeply disturbing that a culture, language and whole way of life is being systematically destroyed in Tibet? The rest of the world is at last beginning to understand that, and that message must get through to the Chinese Government.

[Simon Hughes]

I agree, and I pay tribute to my hon. Friend, who is good at arguing such cases. That proud, historic nation has culturally contributed hugely to the world. It would be a tragedy if we did not manage in our lifetimes to give it the opportunity to do so again.

I have a shopping list, which degrades the matter, but I will put the items on the table. We could argue that there should be permission for the Red Cross or a similar organisation to be allowed regularly into Greater Tibet to ensure that there is independent monitoring of what is going on. We must argue that people must be allowed to teach the Tibetan language in schools in Tibet, and to speak it when they want to so that they can be brought up speaking their own language and understanding their own culture.

I hope that our Government will keep on raising the issue of the Panchen Lama, the Dalai Lama’s heir, who has been captured and has disappeared with his family. No one has owned up to his whereabouts, or to what is being done to secure his freedom and his ability to be where he wants to be with his family.

I hope that the Government will strongly take up the issue of self-immolation with the Chinese authorities, and make a robust statement of concern about that. I hope that they will argue that troops should be withdrawn from Kirti and the monasteries where such things are happening and that the Chinese Government should review their policies. I hope that our Government will raise concerns not just in general with the Chinese authorities, as they have been doing, but with the Chinese Ministry of Religious Affairs. I understand the diplomatic difficulties, but the Government should ensure that the lines of communication are open to the Tibetan Government-in-exile. Of course, Governments do not recognise Governments-in-exile, and our Government do not, but we need to ensure that we understand the democratically represented voices of the Tibetan people.

I want to make two other calls that are not to the Government. The faith leaders of the world should step in and engage themselves. The Christian communities in this country—the Anglicans, the Roman Catholics and the Free Churches—and the Hindus, the Sikhs, the Buddhists and the Muslims need to speak up for other people of faith who are not allowed to practise their faith.

Finally, I hope that the House can play another role. With two colleagues, I co-chair the all-party group on conflict issues, and I hope that we will soon engage with this issue and invite the Chinese Government’s representatives to come and talk here. The issue must be negotiated peacefully. I hope that that can be done, and done soon. There have been too many deaths and too many injuries, and there has been too much oppression. The Chinese must understand that it is in their interests to move on and to give greater autonomy to Tibet—and the sooner, the better.

16:19

Sitting suspended for a Division in the House.

16:29

On resuming—

[The Parliamentary Under-Secretary of State for Foreign and Commonwealth Affairs (Mr Henry Bellingham)]

On a point of order, Mr Gale, what time will this debate finish?

[Mr Roger Gale (in the Chair)]

At 4.45 pm.

[Mr Bellingham]

I congratulate my right hon. Friend the Member for Bermondsey and Old Southwark (Simon Hughes) on securing this important debate, and I pay tribute to him for a committed, well researched and well informed speech. I also thank the hon. Members for Scunthorpe (Nic Dakin), for Carmarthen East and Dinefwr (Jonathan Edwards), for Kilmarnock and Loudoun (Cathy Jamieson) and for Islington North (Jeremy Corbyn) for their contributions.

The Government are seriously concerned about recent reports of self-immolations among nuns in the Tibetan areas of Sichuan province. We have closely followed those reports and other developments in the region. Let me describe the situation as it stands today. We are aware of 11 confirmed instances of monks and nuns in the Tibetan areas of Sichuan province who have self-immolated since March, and we know that four of those people died. We are aware of reports of a number of other attempted self-immolations, including one within the Tibetan autonomous region on 1 December, although those have not yet been confirmed.

The incidents began with the self-immolation on 16 March of Phuntsok, a monk at the Kirti monastery in Aba county, Sichuan. His immolation sparked a number of demonstrations and protests in the area, which by 12 April had led to a stand-off at the Kirti monastery between locals and monks on the one hand and Chinese security forces on the other. That ended on 21 April, when about 300 monks were removed from the monastery by the security forces. Their location and legal status has not been confirmed by the Chinese Government. Six of the 10 subsequent immolations have been by monks, or former monks, linked to the Kirti monastery.

We understand that there continues to be a high security presence at the monastery, and that a significant number of its monks have been dispersed away from the monastery grounds. The other immolations have been by two nuns, one in Aba county and the other in Daofu county, and two monks, one in Daofu county and one in Ganzi county—all in Sichuan province.

The Dalai Lama has made several public statements about the immolations, which he has said are the result of human rights violations caused by discriminatory Chinese policies in the region. The Chinese Government, on the other hand, have stated that the immolations are “politically motivated”, and that the Tibetan community in exile should be held responsible.

I assure my right hon. Friend, and other hon. Members, that the Government have been following developments closely. In terms of making a strong statement, as recently as 29 November my right hon. Friend the Foreign Secretary said that we should urge the Chinese Government to work with local monasteries and communities to resolve the grievances that have led to these self-immolations.

Furthermore, during his visit to China in November, my hon. Friend the Member for Taunton Deane (Mr Browne), the Minister of State, raised his concern about the immolations with Fu Ying, the Chinese Vice Foreign Minister. He also wrote to the Chinese ambassador about the situation at the Kirti monastery, asking for information and calling for restraint. Officials have raised their concerns with the Chinese embassy in London and with the Ministry of Foreign Affairs in Beijing.

At the 17th session of the UN Human Rights Council in June this year, the EU issued a statement calling on the Chinese authorities to refrain from the use of force in dealing with the situation at the Kirti monastery, and to allow independent observers on to the site. British embassy officials have kept in frequent contact with the Foreign Affairs office in Sichuan and with local public security bureau offices, regarding access to those areas.

British diplomats were able to access neighbouring Tibetan areas in October, but we understand that access to the Kirti monastery remains severely limited. I assure my right hon. Friend that we will continue to urge the Chinese authorities to allow access to Tibetan areas for foreign diplomats and journalists, just as we will continue on a regular basis to raise the case of the Panchen Lama.

I wish to say something about the dialogue between China and the Dalai Lama. Let me be explicit: the UK regards Tibet as part of the People’s Republic of China and, as my right hon. Friend recognised, this Government’s position is consistent with and identical to that of the previous Government. All our international partners adopt a similar stance. Our interest, however, is in long-term stability for Tibet, and we believe that that is best achieved through respect for the universal principles of human rights, and genuine autonomy for Tibet within the framework of the Chinese constitution. We believe strongly that meaningful dialogue between the Dalai Lama’s representatives and the Chinese authorities is the best way to resolve those issues.

The last round of talks was held in January last year. No substantive progress has been made for several years. We appreciate that reaching a compromise is not easy and is likely to require sacrifices and risks on both sides. UK Ministers and officials have regularly encouraged both parties to engage in meaningful direct dialogue without preconditions. I certainly agree with the point made by my right hon. Friend the Member for Bermondsey and Old Southwark and other hon. Members that the people of Tibet are peaceful. They preach non-violence and they want dialogue above all else.

I should like to say a few words about the wider situation in Tibet. The Foreign and Commonwealth Office online human rights Command Paper, updated quarterly, provides regular updates on the situation in Tibet and makes it clear that we remain concerned about the rights and freedoms afforded to the Tibetan people.

I should like to begin this part of my speech by discussing political prisoners in Tibet. It goes without saying that the imprisonment of people for exercising their political, cultural and religious rights is completely unacceptable. The Government have lobbied the Chinese Government regarding a number of individuals, including Dhondup Wangchen, who was arrested in 2008 for filming a documentary recording the reactions of ordinary Tibetans to the Olympic games. We have serious concerns about the health and treatment of Dhondup in prison.

Those individuals also include the brothers Karma Samdrup and Rinchen Samdrup, imprisoned in 2009 and 2010. We have very serious concerns about the manner in which charges were brought against those men and about the reports that they have suffered serious mistreatment and torture while in detention. We are committed to supporting efforts to prevent torture around the world. We will continue to advocate the view that independent oversight of prisons is important to maintain prison standards and to prevent the mistreatment of prisoners.

Freedom of religion in Tibet is a particular concern. We believe very strongly that ordinary Tibetans must enjoy the right to live according to their traditions and customs. Political controls and restrictions should not be placed on normal religious practice. Monks, nuns and lay people should be completely free to manifest their beliefs without interference from the state.

We also believe that the languages of minority groups should be actively provided for, particularly in education and employment policy. China’s laws make it clear that its minority groups should have the freedom to use and develop their own spoken languages. However, given the lack of qualified teachers and appropriate teaching materials, access to education in the Tibetan language can be severely limited, particularly at secondary and tertiary levels. Those issues were a focus of the UK-China human rights dialogue earlier this year. My right hon. Friend referred to that dialogue, and we regard it as a very important part of our bilateral relationship.

Of course, we welcome the huge investments that the Chinese Government have made in Tibetan areas—they amount to many billions of dollars a year—but we hope that everything possible can be done to ensure that the economic development of Tibet benefits the native population. Education is part of that; so, too, is ensuring that rural communities benefit as much as urban ones. Consultation and dialogue with local groups is also vital.

Let me say a few words about Tibet’s environment. Tibet has a unique natural environment, which should be carefully protected. We hope that the Chinese Government will respect the knowledge and livelihood of local herdsmen and farmers within that protection, rather than trying to move them away from their ancestral homes. Those groups have managed the land for generations and have a real contribution to make in ensuring that development in Tibet is sustainable.

In addition to the actions that I have mentioned, Ministers have regularly raised with China at the highest political levels our concerns about aspects of the human rights situation in Tibet. We have raised individual cases of concern with the Chinese Government. We have pursued the discussions through our bilateral dialogue with China on human rights and through programmes funded through non-governmental organisations and research institutions. The last round of our human rights dialogue included, for example, an expert workshop on minority rights and languages—an area of particular relevance to Tibet. I make the commitment that, following this debate, the Government will write again to the Chinese authorities to express our concerns about the issues raised here and to urge a return to negotiations with the Dalai Lama’s envoys.

To sum up, the Government are actively engaged both on the issue of immolations in Tibet and on the broader issue of human rights there. The Foreign Secretary has recently said that

“human rights…are part of our national DNA”.

I thank my right hon. Friend the Member for Bermondsey and Old Southwark for raising this issue and giving me the chance to explain the Government’s position. I hope that he accepts that we are actively engaged and will continue to push for the respect of Tibetan human rights and the protection of the culture, natural environment and dignity of the people of Tibet. They deserve nothing less.

Trident

Wednesday 7th December 2011 Westminster Hall

16:44

[Jeremy Corbyn (Islington North) (Lab)]

I am pleased that you are chairing the debate, Mr Gale, and that we have secured it. I regret that it will be only 30 minutes long, but we will do our best. A number of hon. Members want to intervene during my contribution, and I will be happy to take all those interventions, including from the hon. Member for New Forest East (Dr Lewis), who possibly will not agree with one word of what I am about to say. If he can just contain his disagreement until he reaches an appropriate point of disagreeability, I will happily give way to him.

First, I should declare an interest in the debate. I am chair of the parliamentary CND group and vice-chair of the Campaign for Nuclear Disarmament at national level. I have to confess to having first joined CND at the age of 15, and I remain a member, so it is a very short membership that I have had.

The subject of the debate is the cost of the Trident nuclear missile and submarine replacement. This is an issue of parliamentary accountability, costs and, of course, the relationship between vast levels of defence expenditure and our foreign policy. Huge numbers of figures can be cited, and I will cite some. Main-gate consideration of the replacement of the whole system has been delayed until 2016. By that stage, £4 billion will have been spent on the concept and assessment phases of the replacement submarine and £500 million on ordering long-lead construction items. Plans have recently been announced for spending of £2 billion at the warhead facility at Atomic Weapons Establishment in Aldermaston. That coincides with the suggestion in the recently available redacted value for money review that a decision will be taken on the warhead much sooner than previously anticipated.

This debate is therefore designed to point out the amount of money being spent, but also to ask very serious questions about when Parliament will be effectively able to scrutinise what are massive levels of expenditure on a weapon of mass destruction.

[Dr Julian Huppert (Cambridge) (LD)]

I congratulate the hon. Gentleman on securing this much needed debate. He talked about the 2016 main gate. Will he welcome the fact that that has now been delayed until after the next election and that that gives his party an opportunity to take the same view that he and I share about whether it would be desirable to go ahead with the main gate at all? Perhaps even the Conservatives might join us in a triumvirate of sense.

[Jeremy Corbyn]

I would be happier if we killed off the whole project straight away—but I suspect that that might not happen.

I also draw to the House’s attention the fact that the Secretary of State for Defence has announced that he has no plans to publish the Trident alternatives review, which was commissioned to please the Liberal Democrats, who went into the last election promising not a like-for-like replacement of Trident, but something different. We do not know what that something different might be. The review will not be published, which is astonishing. I hope that, when the Minister replies to the debate, he can explain why that is the case.

[Tessa Munt (Wells) (LD)]

As a Liberal Democrat, I remain absolutely committed to my belief that this is a ludicrous waste of money. I am boiling with anger at the fact that, despite an alternatives review having been commissioned, it will not be published. There is no basis for not publishing it so that people can at least consider the alternatives, although my personal preference is as I have stated. Does the hon. Gentleman not agree?

[Jeremy Corbyn]

I thank the hon. Lady for her intervention and the hon. Member for Cambridge (Dr Huppert) for his. They are both very sincere and very honest on the whole issue.

[Tessa Munt]

rose—

[Jeremy Corbyn]

I understand that the hon. Lady is boiling with rage. I, too, am boiling with rage, so we will boil together.

[Tessa Munt]

I apologise for not having declared that I have membership of CND at Mid Somerset level and I am vice-chair of that organisation. I should have said that earlier.

[Jeremy Corbyn]

I know from long experience with CND that nothing to do with CND can be counted as a pecuniary interest. Absolutely no one has ever made any money out of being a CND member. There is nothing financial to be declared, so I set the hon. Lady’s mind at rest. I thank her for her support and membership of CND and for the sincere work that she has done for a long time to try to rid the world of nuclear weapons.

Estimates of the cost of designing and constructing the Trident submarine replacement programme have grown significantly this year, with the MOD publishing figures in the May parliamentary initial gate report that represent a doubling of those in December 2005. The estimated submarine replacement cost has increased from between £11 billion and £14 billion to £25 billion. In addition, the Ministry recently announced significant spending plans for new warhead facilities at Aldermaston, despite officially not planning a decision on replacing or refurbishing the warhead until the next Parliament. That is the question.

[The Parliamentary Under-Secretary of State for Defence (Peter Luff)]

indicated dissent.

[Jeremy Corbyn]

The Minister shakes his head. It is his head, and he is allowed to shake it, but I hope that when he replies, he will be able to explain why Parliament has not been consulted on spending £2 billion on the Atomic Weapons Establishment in Aldermaston. If my figures are wrong, I am sure that he will put them right—that is the whole point of a parliamentary debate and of parliamentary scrutiny.

As I have said, the new figures announced this year for spending on replacing Trident are going up. The submarine will cost around £4 billion before the construction decision. As I understand it, it will cost £900 million on the concept phase before initial gate, which is from 2007 to 2011; £3 billion on the assessment phase between initial gate and main gate; and £500 million on long-lead items for construction. That will put the cost of the submarine replacement programme prior to main gate somewhat higher than what was spent on the Nimrod programme, which was cancelled in October 2010 after £3.4 billion had been spent on it.

Quite simply, we are moving to an enormous expenditure before a parliamentary vote in, presumably, 2016 or whenever, when all of us might still be Members of Parliament—or when none of us are. There will be a new Parliament, and a different Parliament will make that decision. I could write the speech for the Minister or his successor now. It will say, “We do not want to do it, and we do not like it. It is not good, but we have already spent so much money that it would be a shame to waste it.”

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

Does the hon. Gentleman agree that the eye-watering figures that he is describing are of concern not only to some of the CND stalwarts in the Chamber today—myself included—but to those who care about the MOD’s equipment budget, given that all that will amount to around 30% of the budget over the 2020s?

[Jeremy Corbyn]

I am grateful to the hon. Lady for her point. Not only is she a CND stalwart, but she has great responsibility, for she is a member of the CND national council, as I am. I am pleased that she is a member as well. She is quite right—many in the defence community express horror at equipment shortages of all sorts, the privatisation of air and sea rescue, and all those kinds of things that are planned, while at the same time someone is going ahead and planning to spend and spend on replacing Trident, a massive vanity project; that is what it is. It does not seem to bear any relation to any foreign policy strategy or to British membership of the nuclear non-proliferation treaty, which requires clearly under article 6 that the five permanent members of the Security Council, which are also the five declared nuclear weapon states, take steps towards nuclear disarmament. Britain is not taking steps towards nuclear disarmament—it is reducing the number of warheads, but the capability is to be increased. Any Government, whether this one or a future one, could increase the number of warheads.

When the National Audit Office looked at the matter recently, in November this year, it cited problems with the Astute class submarines currently being built. They are now expected to cost £6.67 billion, a full £1.47 billion more than anticipated when the project was approved. Apparently, it is also running five years and one month late. Also, a report, “Looking into the Black Hole”, states that

“spending on the successor programme will rise sharply, probably reaching a peak of around 30% of the new equipment budget by 2021-22 or 2022-23”—

exactly the point made by the hon. Member for Brighton, Pavilion (Caroline Lucas)—

“when the first-of-class begins production. It is likely to remain close to this level until after the planned delivery of the first submarine in 2028.”

I want to turn to the issue of transparency—

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

Will the hon. Gentleman give way?

[Jeremy Corbyn]

There is no finer person to be transparent than the hon. Gentleman.

[Dr Julian Lewis]

I know that I am going to get one shot at this, and I thank the hon. Gentleman for his great courtesy. I would like to remind him that there was a parliamentary debate and a vote in, I think, the spring of 2007. It is not as if Parliament has not had one vote on the matter, and it will have another one. Does he agree that the cost overrun for the Astute class submarine was so great because of the gap that had been allowed to develop between the completion of the nuclear deterrent submarines of the Vanguard class and the initiation of the Astute class? By ensuring that the next generation of boats follow closely on from the Astute class, any such increase should be avoidable. There is precedent for that, because both Polaris and Trident came in on time and on budget.

[Jeremy Corbyn]

There is a precedent for this debate, which was the full debate that was held four years ago in 2007, in which a significant number of MPs from my party—100—voted against the replacement of Trident. Every other debate was initiated by Back Benchers, some of whom are present today. That is the function of Parliament, and I hope that, when the Minister replies, he will be able to assure me that there will be regular statements to update Parliament.

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

There was a debate in 2007, which arrived at a vote—that is true. However, is it not true that, in every debate that we have had, the figures on the speculative development have gone up rather than down?

[Jeremy Corbyn]

Indeed. One of the facts of life is that for anything to do with nuclear weapons, nuclear equipment, AWE Aldermaston or submarines, the price goes up and up, whatever else happens.

The Liberal Democrats have called for a Trident alternative review—that is fine. The Secretary of State announced that the review will take place, fulfilling the coalition agreement by

“assisting the Liberal Democrats to make the case for alternatives.”

However, on 21 November, he said that he had no plans to publish the review. He said:

“In looking at alternative systems and postures, the review draws upon highly classified technical, intelligence and policy information covering extremely sensitive national security issues. There are, therefore, no plans to publish either the report or the information it draws upon.”

Regarding providing information for MPs to scrutinise the Trident replacement programme, the Secretary of State stated that he

“intends to provide an annual update to Parliament; the first of these was produced for the Initial Gate announcement in May of this year. The precise format and timing of subsequent statements is yet to be decided.”—[Official Report, 21 November 2011; Vol. 536, c. 34W.]

Today, the Prime Minister made a written ministerial statement on defence issues, called, “Strategic Defence and Security Review: First Annual Report”. It states:

“In addition, to assist the Liberal Democrats make the case for alternatives to the Trident system, the Government initiated a study into the costs, feasibility and credibility of alternative nuclear deterrent systems and postures. Progress has also been made on implementing the new nuclear assurances policy and the reduction in our nuclear weapon stockpile to no more than 180 warheads, both commitments set out in the SDSR.”

I find it strange that the Secretary of State would say that we in Parliament are not equipped to know the basis on which an alternative is being looked at. We are not allowed to see the information, because apparently it is all classified. We therefore assume that the alternative is simply never going to see the light of day. Despite the valiant efforts of a number of Liberal Democrat MPs to get that, on the Floor of the House, it will be extremely difficult. The Minister must explain exactly why Parliament is not equipped to know why such vast levels of expenditure are going ahead, and why an alternative is not going to be published.

[Tessa Munt]

I am sure that the hon. Gentleman will agree that the Minister will have to explain that in that case—it would seem to me—the costs are not known, and it is neither feasible nor credible for us to have the particular scheme.

[Jeremy Corbyn]

Absolutely. If we do not know the cost, if we do not know what the alternatives are and if we do not know the foreign policy considerations surrounding the alternatives, we move into the era—once again—where the Ministry of Defence basically does what it likes and Parliament endorses it at some later stage. So we are moving—sleepwalking, actually—into a massive level of expenditure. Never mind whether people like or dislike, agree with or disagree with, nuclear weapons—is that really a sensible way for this country to go headlong into spending £100 billion?

[Eric Joyce (Falkirk) (Lab)]

Does my hon. Friend think that, when the Government committed themselves to a review, they must have known what the nature of the review was going to be, so they must also have known at the time that they were never going to make the review public?

[Jeremy Corbyn]

Presumably, there were discussions in the MOD about exactly what the terms of the review would be, who would contribute to it and what desk research would be done. The MOD must have also decided, “Well, we’re not going to publish it anyway, so it doesn’t really matter what’s in it.” If I were a Liberal Democrat MP—I am not one, I have no intention of being one and I do not think that I ever will be one, so I am talking about a purely hypothetical situation—I would be very angry about that because, having negotiated that review into the coalition agreement, the Liberal Democrats are now being told that they are not even allowed to know what is in it.

Before I give the Minister sufficient time to reply—I am sure that he will be happy to take even more interventions than I have—I have a few questions to put to him. If the current Government are re-elected in 2015, will they provide a parliamentary vote on the Trident main gate? When will the format and timing of the annual update statements be decided, and what is the reason for delaying an announcement on those statements? To their credit, the Government have produced quarterly statements on the situation in Afghanistan, and frequent statements on the situation in the middle east and north Africa. I welcome those statements; they show openness, which is good. Consequently, those of us who take those matters very seriously can question the Foreign Secretary and the Secretary of State for Defence on them regularly in Parliament, and we know when those opportunities are coming up. That is what Parliament is for and that is the right way of doing things. The expenditure on Trident is so massive, the decision on Trident is so huge and the implications of Trident are so enormous that we need something more than an annual statement about it to Parliament. We need at least a quarterly statement on Trident from the Secretary of State for Defence.

My two final questions to the Minister concern work at Aldermaston, because it seems to me that there is something very murky going on at Aldermaston—something very murky indeed. A huge amount of money is being spent there and, as I understand it, a lot of preparation is being made there for warhead production. So we need to know what the nature of the work is to inform decisions on design of a successor warhead—work that is currently under way—and how much money is due to be spent on those studies in the current comprehensive spending review period? Also, what are the costs of the nuclear weapon sustainability programme at Aldermaston, and will the Minister make those costs public?

I will conclude with this point—I have set out my position absolutely clearly. I believe that nuclear weapons are immoral and wrong, and we have huge obligations and huge opportunities through the nuclear non-proliferation treaty, not only to rid ourselves of nuclear weapons but to promote a nuclear weapons convention that would bring the non-declared nuclear weapons states—Israel, India, Pakistan and North Korea—into the discussions about ridding the world of nuclear weapons altogether. If we are serious about going down that road and achieving a nuclear-free world, we have to do something about it and set an example. It is a pretty strange example to deny Parliament the opportunity to discuss Trident in detail, so that it can know the expenditure involved, and to commit ourselves to this vast expenditure on a weapon of mass destruction that—if ever used—will indiscriminately kill millions of people on this planet. As I have said, nuclear weapons are immoral, wrong and dangerous, but we have a right to know the levels of expenditure on them. I hope that this debate is the start of many debates on this subject. Many of us who are committed on this subject will keep on raising it, so that we know the truth about the amount of money that this country is spending on weapons of mass destruction.

15:16

[The Parliamentary Under-Secretary of State for Defence (Peter Luff)]

Mr Gale, without wishing to trivialise this very important subject in any sense, I had intended to begin my remarks by a reference to that famous line of Captain Louis Renault about rounding up the usual suspects at the end of “Casablanca”, but the number of usual suspects seems to have expanded today to a rather larger number than I had expected. I had imagined that only the hon. Member for Islington North (Jeremy Corbyn) and my hon. Friend the Member for New Forest East (Dr Lewis) would be in Westminster Hall today, but I welcome the larger group of actors.

I am delighted to be in Westminster Hall once again to explain to the hon. Member for Islington North why we are right to proceed with our plans to maintain the security of our nation and why I think that he made a number of serious misinterpretations of the facts—let me put it that way—during his speech.

The Government have been clear that the safety and security of the UK is our first priority, and although we are facing difficult economic circumstances and a challenging inheritance from the previous Administration, our security must be seen as a long-term issue.

At the outset and on behalf of the whole House, I want to pay tribute to the professionalism of all those Royal Navy and civilian personnel who answer this country’s call to operate and support this vital national capability. Having visited HMS Vanguard at sea and HMS Vigilant in refit, I have met some of our dedicated service personnel who support Operation Relentless, which is the UK’s mission to maintain continuous at-sea deterrence. I was deeply impressed by their commitment and I am very grateful to them; I think that we should all be grateful to them. It is important that hon. Members remember that, even as we speak, those men are out there somewhere in the oceans providing Britain’s ultimate national security guarantee. They and their predecessors have maintained a 42-year unbroken chain of continuous at-sea deterrence, keeping all of us and our allies safe.

In many respects, we face a more dangerous situation now than we have done for several decades. There are substantial risks to our security from emerging nuclear weapons states. Consequently, although we are committed to the long-term goal of a world without nuclear weapons, as we all are in this place, we believe that we can best protect ourselves against those threats by the continued operation of a minimum, credible nuclear deterrent. [Interruption.] Others might find that funny, but I do not find it funny at all. Maintaining that deterrent is a very serious judgment that is shared by all three major parties in the House. It is important to remember that the alternative study, which I will return to later, which has been promised to the Liberal Democrats and which is proceeding, only considers the delivery platform and not the alternative to a minimum credible national deterrent programme. All three major parties are committed to such a programme.

The UK has a strong record on nuclear disarmament. We have continued to work with other nations to achieve our goal of a world without nuclear weapons. In addition to the well-documented commitments in the strategic defence and security review, I draw the attention of the hon. Member for Islington North to the statement in June that we have already begun to implement the reduction in warheads that are carried on our submarines. In addition, earlier this year, the permanent members of the UN Security Council met in Paris to take forward the action plan from the 2010 non-proliferation treaty review conference. We agreed to work together on a number of initiatives and Britain has taken the lead by agreeing to host a meeting in early 2012 to discuss the lessons that have been learned from our bilateral work with Norway on the verification of nuclear weapon dismantlement.

Having set out the Government’s fundamental policy, I want to address one further issue before I turn to the specific details of Trident’s costs. One theme that frequently emerges—it emerged again today in the hon. Gentleman’s speech—is the engagement with Parliament on the replacement of the nuclear deterrent. The hon. Gentleman’s colleagues in CND often accuse the Government of having a culture of secrecy with regard to the deterrent.

Clearly, there are aspects of the programme that are sensitive and that must remain classified for national security purposes. I will also discuss the Trident alternative study in that regard. The Government have received many requests, including from the hon. Gentleman in his speech, for information on the Trident alternatives study. The nature of that study, which is led by the Cabinet Office, requires highly classified information to be analysed. Indeed, only a small number of people in my Department and in the Cabinet Office can see that information. Therefore, Members will appreciate that we will not be able to publish the study itself, as doing so would be irresponsible and put national security at risk.

No decisions have yet been taken about what it might be possible to say without compromising national security, and as the report to the Prime Minister and the Deputy Prime Minister will not even be concluded until late 2012 or early 2013, it would be premature at this stage to commit to any specific course of action; for that reason, I will not be doing so today. I have no doubt that the public would understand that we want to take great care of those secrets, but we have nothing to hide except that which it is essential to hide for national security. Where we can, we have explained as clearly as possible what we are doing and why we are doing it, and I will do so yet again today for the hon. Gentleman’s benefit.

[Dr Julian Lewis]

Before my hon. Friend the Minister moves on to the question of costs, I want to make a point about the alternative study. In response to the hon. Member for Islington North (Jeremy Corbyn), who has secured this debate, it is presumably reasonable to assume that, at the very least, a list of those alternatives to Trident that were considered and dismissed, as well as a rough idea of the reasons why they were dismissed, will be published even if technical details cannot be released. Does the Minister accept that, when the hon. Gentleman talks about nuclear weapons killing millions of people if ever used, surely the response is that they are being used every day, because their use lies in the prevention of the use of similar weapons against this country and our interests?

[Peter Luff]

I note my hon. Friend’s powerful argument. I am sure that it will be borne in mind closer to the time, but at present I can make no commitment about what will happen at the end of 2012 or in early 2013, when the report is due to conclude.

I note that this is the third time that I have debated this issue in this place. We also covered the topic extensively during the strategic defence and security review debate last year. Since assuming Government, my Ministry of Defence ministerial colleagues and I have answered about 180 parliamentary questions on nuclear issues, not to mention a significant amount of public correspondence. In May this year, we published a comprehensive report on the initial gate decision for the successor submarine. We have recently repeated an earlier commitment to make an annual statement on progress to Parliament, and I think that that frequency strikes the right balance. We have published the costs of various aspects of the nuclear programme, such as the Atomic Weapons Establishment, on numerous occasions. Moreover, in May last year, we announced for the first time the overall size of our nuclear warhead stockpile, giving the deepest ever transparency of our nuclear capability. That is hardly a culture of secrecy or sleepwalking.

[Jeremy Corbyn]

I am not quite sure why the Minister is getting into such a bad mood about Parliament asking questions to the Ministry of Defence. That is what Parliament is for; it is why we are here. Will he give us an accurate estimate of how much will be spent on the whole programme, on the initial gate and on the Atomic Weapons Establishment at Aldermaston, before any decision is made in Parliament in 2016? Can he not revisit the idea of a quarterly statement on the vast expenditure that is going on?

[Peter Luff]

It is my intention to do that, but I am conscious of the time. I hope to be able to answer all the hon. Gentleman’s questions.

I should now like to turn to the specific costs of the current and future deterrent programmes. The simple fact is that being a responsible nuclear weapons state requires investment. Submarines and their ballistic missiles and nuclear warheads are extremely complex and require considerable skill and expertise to design, maintain and operate safely, and I make no apology whatsoever for taking seriously our responsibilities for the safe custody of these systems, nor for spending the money needed to do that. That is not to say that we have not closely scrutinised the costs of the programme. Indeed, Members will be aware that we announced last year as part of the SDSR a number of measures to do just that.

I should like to dwell briefly on the different elements of the nuclear deterrent programme. The White Paper highlighted three key areas: the platform, the infrastructure and the warhead. At 2006 prices—I emphasise that it was at 2006 prices—the Department estimated that the platform would cost between £11 billion and £14 billion, and each of the other two elements would cost between £2 billion and £3 billion. Separately, there are also the costs of maintaining and running the in-service deterrent—what we have at present—such as the facilities at the Atomic Weapons Establishment, which I will come to later.

If I may start with the platform—the boats—earlier this year “The Initial Gate Parliamentary Report” stated:

“assuming a four boat fleet, the replacement submarines will remain within the £11-14Bn estimate.”

We made it clear in the report and, indeed, in the White Paper itself that those values are at 2006-07 constant prices, and the report also indicated that, when we take into account inflation, the costs equate to £25 billion. Costs have simply not doubled, as reported on CND’s website; that is wrong. This misreporting of the true position is extremely misleading. Of the £25 billion, we expect to have spent £3.9 billion by main gate. That includes the costs of the concept and assessment phases, and the majority of that work is in the maturation of the design.

With regard to long-lead items, we have been clear that we have minimised spend as far as possible. Over the coming years, we will place orders for different specialist items, which take a number of years to be delivered, totalling some £500 million. That is just 2% of the total purchase cost. We plan to place the order for the specialist high-grade steel only in 2014, so that it is ready for manufacture and cutting in 2016 after the main investment, or main gate, decision. We will not procure any items for the fourth boat until 2016, when the build decision is made. Any accusation that, by purchasing those items, we will be locked into a particular strategy before main gate in 2016 is simply wrong. The simple fact is that these highly specialised components take time to be delivered. Identifying long-lead items is part of any well-run programme, and nothing that we are doing will prevent us from being able to make the right decision in 2016. I should like to explore that at more length, but I am conscious of the time.

With respect to infrastructure, the value-for-money review concluded that no significant investment was needed in the immediate future. To study the infrastructure requirements in detail, we will spend about £8 million over the next three years and will continue to look for opportunities to drive down running costs and the need for any new investment. Despite being at an early stage of the programme, we still expect to meet the White Paper estimate of between £2 billion and £3 billion.

On the third element, my attention was drawn recently to speculation that implied that we had already spent at least £2 billion on a new warhead. That is simply not true. We are investing at the Atomic Weapons Establishment to ensure that we sustain the capabilities that we need to maintain the current stockpile. It is true that that will give us the capability that we need to design and produce a new warhead if and when required, but that is not the purpose of the expenditure. We will take the appropriate decisions at the right time, and Members will recall the commitment in the SDSR not to take any decisions on a new warhead until the next Parliament. We expect a replacement warhead to meet the White Paper estimate of between £2 billion and £3 billion.

17:15

Sitting adjourned without Question put (Standing Order No. 10(11)).

Written Ministerial Statements

Wednesday 7th December 2011 Written Statements

Wednesday 7 December 2011

Asset Protection Agency

Wednesday 7th December 2011 Written Statements

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

The Asset Protection Agency (APA) has today published two legal agreements relating to the asset protection scheme (APS). Copies of the agreements have been deposited in the Libraries of both Houses.

The first of these agreements moves the main focus of asset management governance to the riskiest assets in the APS, to ensure that the level of APA oversight is commensurate with our current view of the risk associated with the APS. The second principally introduces revised rules for overdrafts that are outside the scope of the supplemental agreement relating to operational alignment outlined in the written ministerial statement laid on 14 July 2011, Official Report, column 35WS. This resolves an agreement to agree in the original accession agreement.

These agreements are in addition to the supplemental agreement on aligning the operation of the APS with RBS’s “business as usual” finance and risk management process, as outlined in the WMS on 14 July 2011. Details of other previous supplemental agreements are contained in the WMS laid on 15 February 2011, Official Report, column 72WS .

Central Office of Information

Wednesday 7th December 2011 Written Statements

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

I announced on 23 June 2011 that the Government’s changes to improve the effectiveness and efficiency of Government communication would include the closure of the Central Office of Information (COI). The Central Office of Information Trading Fund (Revocation) Order 2011, laid before the House of Commons today, provides for the COI trading fund to cease to exist on 30 December 2011. On the same day as the COI trading fund ceases to exist, the Prime Minister has agreed that the existing functions of COI should be transferred to the Cabinet Office and therefore that COI will cease to exist as a separate non-ministerial Department.

EU Foreign Affairs Council (Defence)

Wednesday 7th December 2011 Written Statements

[The Parliamentary Under-Secretary of State for Defence (Mr Gerald Howarth)]

The EU Foreign Affairs Council met in Defence Ministers formation on 30 November 2011 in Brussels. I represented the UK.

The agenda items covered were current operations, partnerships, the Athena mechanism review (the method for calculating common funding for military operations), and the European Defence Agency (EDA) budget.

Foreign Affairs Council (Defence)

The three current EU operations, Operation Atalanta (counter-piracy). Operation Althea (Bosnia and Herzegovina) and EU training mission Somalia (military training mission) were discussed in the Council. While expressing concern about the difficulty in meeting the commitments to which member states have agreed, I expressed the UK’s support for these ongoing operations and presented the UK’s offer to continue to command Operation Atalanta from the UK’s operational headquarters at Northwood.

EU/NATO partnerships were also discussed, re-emphasising the importance of close working relations while avoiding duplication.

There was no discussion at the Council on the Athena mechanism review (the method for calculating common funding for military operations) as nations had been unable previously to reach agreement. The noble Baroness Ashton proposed that further work should be carried out and the Council conclusions noted the ongoing work on the review with a view to an agreement by the end of 2011.

I made clear that, in the current economic climate, with most member states, including the UK, reducing their defence budgets, I could not agree to an increase in the budget of the EDA for 2012. The Council subsequently agreed to freeze the EDA budget for 2012 at the same level as 2011 (€30.5 million) in accordance with the recommendation of Baroness Ashton.

Defence and Foreign Secretaries’ Joint Dinner

In the Defence and Foreign Secretaries’ joint dinner, the EU’s performance in planning and conducting missions and operations was discussed with further discussions taking place at the Foreign Affairs Council on 1 December 2011. The outcome of these discussions is reported separately in the Foreign and Commonwealth Office’s written ministerial statement on the Foreign Affairs Council (FAC).

In the FAC, Council conclusions on common security and defence policy (CSDP), missions and operations, capability development and improving the EU’s performance in planning and conducting missions and operations were agreed. These can be found at:

http://www.consilium.europa.eu/uedocs/cms_data/docs/pressdata/EN/foraff/126504.pdf.

The European Defence Agency Steering Board

An EDA steering board at Defence Ministers level was held immediately before the Foreign Affairs Council (Defence). This meeting agreed the EDA work programme 2012, the EDA work plan for 2012-14, the annual defence data report, and the establishment of the helicopter training programme category B project which meets the UK’s requirement for EDA preparations to deliver real capability. I announced the UK’s intention to join the helicopter training programme project. There was a substantive discussion on pooling and sharing; in particular on the opportunities identified by the EDA and member states expressed their interest in engaging in specific projects and programmes.

NHS Outcomes Framework 2012-13

Wednesday 7th December 2011 Written Statements

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

The White Paper “Equity and Excellence: Liberating the NHS” (Cm 7881) outlined a vision of an NHS that achieves health outcomes that are among the best in the world. It explained that an NHS outcomes framework would be developed to provide national level accountability for the outcomes that the NHS delivers.

I have today published “The NHS Outcomes Framework 2012-13”. This refreshes the first NHS outcomes framework published for England in December 2010 and includes updated definitions for some of the indicators in the framework.

The framework has three main purposes, which remain the same in this updated version:

to provide a national level overview of how the NHS is performing against certain outcome measures;

to act as a mechanism for the Secretary of State to hold the NHS Commissioning Board to account for delivering improvements in outcomes, from April 2013; and

to act as a catalyst for driving improvement and a focus on outcomes throughout the NHS.

A copy of “The NHS Outcomes Framework 2012-13” has been placed in the Library. Copies are available to hon. Members from the Vote Office and to noble Lords from the Printed Paper Office.

High-Level Forum on Aid Effectiveness (Busan)

Wednesday 7th December 2011 Written Statements

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

1 would like to inform the House of the outcomes from the fourth high-level forum on aid effectiveness, which I attended in Busan, Republic of Korea on 29 November to 1 December 2011.

I am pleased to report that Britain’s three priority areas for Busan—results, transparency and fragile states—formed the core of the Busan outcome document, and that our goal of getting an agreement that the emerging economies could support was also met.

A major achievement of the forum was the establishment of a new global partnership for effective development co-operation, which for the first time includes emerging economies like China and Brazil as participants in a development partnership based on recognised common goals and shared principles. This followed significant work by the UK to ensure China joined the partnership, including discussions I held with Chinese Minister of Commerce Chen Deming in Beijing immediately ahead of Busan. The global partnership also includes civil society, Parliaments and the private sector, recognising the important role played by each in achieving development results.

The Busan outcome document: “Busan Partnership for Effective Development Co-operation” places the UK’s focus on results, transparency and fragility at the heart of the international development agenda. It includes agreement to a new shared principle to “Focus on Results”, aimed at ensuring our development efforts have a lasting impact on eradicating poverty, and reflecting UK-led work over the past 18 months to build international support for this agenda. There was also agreement to a new shared principle on transparency, and further success in this important area with the US, Canada and CDC all signing up to the UK-led international aid transparency initiative. This will significantly boost further the information available to citizens about aid, helping enable them to hold their Governments to account.

Another achievement in Busan was the launch of the “New Deal” for ways of working in fragile and conflict-affected countries, which are often furthest from reaching the millennium development goals (MDGs). The UK has played a key role in developing this “New Deal”, which includes five new peace-building and state-building goals aimed at making progress in areas where it is most urgently needed, including justice, security and jobs. I was pleased to announce in Busan that the UK will be partnering South Sudan and Afghanistan to implement the “New Deal”.

I am determined to ensure that the agreements reached there are followed up and that the new global partnership achieves the goals set out. As part of this we will be working with others to maintain the clear focus on results needed to improve the lives of millions of poor people around the world, and to ensure value for money for the UK taxpayer.

Strategic Defence and Security Review (First Annual Report)

Wednesday 7th December 2011 Written Statements

[The Prime Minister (Mr David Cameron)]

Along with the Deputy Prime Minister, and the other members of the National Security Council, I am pleased to provide the House with the following update on implementation of the 2010 strategic defence and security review. This review was undertaken at a time of immense challenge for UK defence and security: a severe mismatch between future defence plans and budgets inherited from the previous Government; the absence of any up-to-date strategy within the Ministry of Defence (MOD), due to the lack of a defence review for 12 years; a major global economic crisis that required action across the whole of Government to tackle the deficit; and armed forces engaged in a major campaign in Afghanistan. As the Government made it clear at the time, the challenges facing defence were too great to solve in a single review. But the SDSR took the first vital steps to transform UK defence and security to face the challenges of the 21st century.

Based on the conclusions of the new national security strategy, “A Strong Britain in an Age of Uncertainty”, the SDSR described the National Security Council’s chosen policy response: an adaptable defence and security posture able to respond flexibly to a wide range of potential crises while continuing to fulfil our standing commitments. This is an approach that depends upon integrated effort across Government, achieving greater effect by combining defence, development, diplomatic, intelligence and other capabilities. Events over the last year, especially the profound changes under way in north Africa, have underlined the wisdom of this approach: few predicted an Arab spring even six months before it occurred—powerfully illustrating the need for a highly adaptable posture The campaign in Libya showed it was right to keep balanced armed forces, right to retain a significant RAF fast-jet capability, right to focus on building practical co-operation with the UAE and Qatar, and right to be buying more drones, tanker aircraft, helicopters and intelligence gathering capability.

We undertook in the SDSR to report annually to Parliament on its implementation. Today the Deputy Prime Minister and I are placing copies of the first SDSR annual progress report in the Library of the House. The report describes the work that has been carried out in the last year. Key developments include agreement on a radical plan to transform the MOD, based on the conclusions of the review by Lord Levene; taking the very difficult further steps necessary to close the £38 billion shortfall in funding over the next 10 years; completion of a review into the future of the reserve forces; establishment of a transformative cyber-security programme; new measures to tackle both the terrorist and organised crime threats to the UK; and expanding and strengthening our network of influence in a fast changing world.

Decisions taken during the SDSR and the 2010 comprehensive spending review ensured that we will continue to meet the NATO target of spending at least 2% of GDP on defence over the spending review period: in 2014-15, the UK defence budget will be £33.5 billion. Further work was undertaken this year to address the longer-term financial position so that on 18 July the Government were able to set out plans to increase in real terms the investment in defence equipment by 1% per annum between 2015-16 and 2020-21. On the same day, the Government announced detailed plans to return the Army from Germany and £1.5 billion of additional investment in our reserve forces, expanding their size after years of decline, enhancing their role and adjusting the long-term balance between the regulars and reserves. Taken together with a range of further measures this has brought the defence programme broadly into balance with the resources available for the first time in many years and ensured that the Government can deliver the long-term vision for our armed forces: Future Force 2020.

These measures ensure that Britain retains the fourth largest military budget in the world and that we will invest around £150 billion in equipment for our armed forces over the next 10 years. By tackling the imbalance in the defence programme, the Government have been able to commit to a range of new equipment programmes for which funding had previously not been identified, including 14 new Chinook helicopters and refurbishment of the Army’s fleet of Warrior vehicles. In May this year, formal approval was granted to begin the assessment phase for the programme to replace the Vanguard-class submarines. In addition, to assist the Liberal Democrats make the case for alternatives to the Trident system, the Government initiated a study into the costs, feasibility and credibility of alternative nuclear deterrent systems and postures. Progress has also been made on implementing the new nuclear assurances policy and the reduction in our nuclear weapon stockpile to no more than 180 warheads, both commitments set out in the SDSR.

The past year has seen significant changes in the threat from international terrorism. Al Qaeda’s leadership is now weaker than at any time since 9/11. But al-Qaeda continues to pose a threat and groups affiliated to al-Qaeda in countries such as Yemen and Somalia have emerged as a threat in their own right. We are implementing a revised counter-terrorism strategy to tackle the terrorist threat to the UK and our interests overseas. In keeping with the approach in the SDSR, we are also working hard to tackle the underlying causes of instability in Yemen and Somalia.

The SDSR recognised the rapidly changing nature of opportunities and risks from cyberspace. Following the April launch of the UK’s £650 million national cyber-security programme, the new cyber-security strategy, published on 25 November, sets out the UK’s approach to cyber-security in four priority areas: securing opportunities for UK growth, including overhauling the UK’s approach to tackling cybercrime; strengthening and securing UK infrastructure and improving our ability to protect our national interests in cyberspace; helping shape an open, vibrant and safe cyberspace; and improving national cyber-security skills and capabilities. November’s London conference on cyberspace demonstrated the UK’s continued lead in international cyber-thinking and enabled us to build alliances with like-minded nations, the private sector and civil society.

The organised crime strategy, “Local to Global”, was published in July, setting out the Government’s response to organised crime, a key element being the creation of the National Crime Agency—a powerful new body of operational crime fighters that will make the UK a hostile environment for serious and organised criminality. The NCA will incorporate a border policing command which will provide a co-ordinated, multi-agency, cohesive approach to securing the border.

Tackling the root causes of instability and helping to resolve conflicts overseas are key national security tasks. We have put development at the heart of an integrated approach that supports the world’s most vulnerable people and protects Britain from external threats. The FCO, DFID and MOD launched the building stability overseas strategy on 19 July. The three Departments are now working with the rest of Government and with NGOs and international partners to implement the strategy. In other areas too, the SDSR committed us to focusing existing resources better in a more co-ordinated Government response. On natural hazards, the last year has seen the largest ever multi-agency exercise to test the UK’s response, as well as a review of arrangements for an influenza pandemic and vital steps to reduce the vulnerability of critical national infrastructure.

In a rapidly changing world, alliances and partnerships are more important than ever to the UK’s international influence and therefore our national security and prosperity. Internationally we rarely act alone. We are working more closely with established allies, including through the two ground-breaking defence treaties signed with France last year and our continuing close co-operation with the USA. We continue to deepen our defence co-operation with France and to explore the potential to open such co-operation to other nations willing to invest in developing and deploying modern military capabilities. The UK has led the debate on tougher action on piracy, commanding EU Operation Atalanta, the EU mission to counter piracy off the coast of Somalia. On 11 May, the Foreign Office also announced plans to expand its diplomatic network in India, China, Brazil, Turkey, Mexico and Indonesia, and re-open embassies in Côte D’Ivoire, El Salvador and Madagascar. We will use this strengthened diplomatic network to develop the partnerships the UK needs not only to ensure our security but also to promote British commercial interests—as we did through the UK business delegations that have accompanied ministerial visits to China, India, Brazil and Russia.

The acid test of any defence and security strategy is its ability to deal with a crisis. The UK’s prompt and flexible military, diplomatic and stabilisation activity in Libya confirmed the validity of many of the key conclusions of the SDSR. The outstanding performance of our armed forces and civilians demonstrated the UK’s continued ability to project power flexibly and to take a leading role in shaping international events. NATO again demonstrated its centrality. And the excellent political and military cooperation with France, other NATO partners and Gulf states demonstrated the vital importance of strengthening defence ties with existing allies and new partners in tackling defence and security.

Work continues across Government to implement the SDSR and we will provide a further annual update to Parliament in 2012.

EU Transport Council

Wednesday 7th December 2011 Written Statements

[The Secretary of State for Transport (Justine Greening)]

I will attend the second Transport Council of the Polish presidency which will take place in Brussels on 12 December.

The presidency will be seeking a political agreement on a proposal for a directive of the European Parliament and of the Council establishing a single European railway area (Recast). The European Parliament had its first reading of this proposal on 16 November. Many of the Parliament’s amendments differed significantly from the Council’s general approach text. Following discussion at the one Council working group meeting that took place following the first reading it is expected the presidency will seek a political agreement, which incorporates only those amendments that do not alter the general approach, and thus will be acceptable to the UK.

The Council will be asked to reach a partial general approach on a draft regulation amending Regulation 3821/85 on recording equipment in road transport and amending Regulation 561/2006. The UK supports elements of the proposal that aim to reduce burdens on business. I will want to resist provisions that might impose unnecessary burdens or additional costs on Government or industry, including the proposal to ban operators from installing and calibrating tachographs in their own vehicles. I will be seeking to minimise the risks of increases in costs and burdens via future decisions taken by the European Commission (“the Commission”) under a delegated or implementing act, by pressing for clearly specified constraints on the scope of proposed action.

The Council will be asked to reach a general approach on a proposal for a directive of the European Parliament and of the Council amending Directive 2008/106/EC of the European Parliament and of the Council on the minimum level of training of seafarers. Although we would question the merit of a European database of seafarer certification, we have negotiated important changes which would require the anonymisation of seafarer personal data to be a mandatory precondition of the obligation to transfer data. We have also negotiated changes to align the text more closely with the deadline for the implementation of the amendments to the international convention on standards of training, certification and watchkeeping for seafarers to avoid placing additional burdens on EU member states which would put our flags at a competitive disadvantage with other countries’ flags.

The Council will be asked to reach a general approach on a proposal for a regulation of the European Parliament and of the Council on the accelerated phasing-in of double-hull or equivalent design requirements for single-hull oil tankers (Recast). The UK is in favour of the general approach proposed for the draft recast of these regulations which brings European law in line with amendments agreed at the International Maritime Organization.

There will also be a progress report on a proposal for a regulation of the European Parliament and of the Council on Union guidelines for the development of the trans-European transport network. The UK recognises that the TEN-T network should be focused on projects that carry clear EU added value and should be supported by guidelines on projects seeking EU funding. We do not support standards and requirements being expanded to the wider TEN-T network on a mandatory basis. We believe that decisions on national projects to be prioritised for development and investment should remain with the member states and the transport operators concerned. Furthermore, the UK is keen to ensure that this proposal does not impose any additional financial or administrative burdens.

The main items under any other business include the Commission’s presentation on its proposal for an airport package, the implementation and exploitation of European satellite navigation systems and the connecting Europe facility. The Commission will also provide information on the European aviation safety management system and air cargo security action plan.

The Polish presidency will provide information on the ministerial conference on Eastern Partnership held in Krakow on 24-25 October 2011 and on the high-level conference on the implementation of the single European sky and its extension to third countries held in Warsaw on 28 November 2011.

The Danish delegation will also provide information on the work programme of their forthcoming presidency of the EU.