House of Lords
Young Children: Language Development
(13 years ago)
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Lord Quirk
To ask Her Majesty’s Government what steps they are taking to ensure that, by the age of seven, all children with retarded development of their language faculty have been identified and their problems addressed.
The Parliamentary Under-Secretary of State for Schools (Lord Hill of Oareford)
My Lords, the revised early years foundation stage framework will emphasise more strongly the importance of communication. We plan to introduce a check on children's progress at age two from September 2012. Revised assessment arrangements will identify more clearly how every child is developing in this important area at age five. There will be a new phonics test at age six. Together, the new arrangements will also promote better information sharing between reception class and year 1 teachers, and with parents.
Lord Quirk
My Lords, I am most grateful to the Minister for that encouraging reply. Does he agree with John Bercow that severe delay in language development is “far more prevalent” than the SLIs of his own recent inquiry—that is, the pathologies that demand professional therapy? Even with the very welcome news of the 2012 programme aimed at toddlers, many thousands will continue to be missed. Will improved Ofsted procedures ensure a primary school regime that is sensitive enough to spot the little boy whose unhappy silence is born not of incapacity but of being starved of normal linguistic stimulus from parent, sibling or carer?
Lord Hill of Oareford
My Lords, I agree with the point underlying the Question of the noble Lord, Lord Quirk, about the importance of this. Our combination of measures will include the point that he refers to about making sure that Ofsted inspectors get specific training in identifying the problem that he raises about linguistic development. The number of language therapists is going up as well, and I hope that with our range of measures we will make the kind of progress that he would like. Will we be able to catch every child always and give them the help that they want? That is a noble aspiration, but I cannot put my hand on my heart and say that we will, for obvious reasons.
Baroness McIntosh of Hudnall
My Lords, does the Minister agree that for many children the problem is, as the noble Lord, Lord Quirk, outlined, not that they have any native problem but that they live in a severely impoverished environment as far as language is concerned? Anticipating a Question further down the Order Paper, does he agree that it is necessary for the Government and local authorities to do everything possible to promote reading programmes for children, and particularly programmes that allow them to be read to, both in and out of school, which will go a very long way to make better that impoverishment?
Lord Hill of Oareford
My Lords, I agree entirely with the importance of reading and about the crucial role that parents play in that. It is not just a practical point; I cannot think of anything nicer than the bond between parent and child that comes through reading. I also agree that speaking to one's child is part of this as well. I agree with the importance of all those points.
Baroness Walmsley
My Lords, is the Minister aware of the research that shows that the part of the infant's brain that is responsible for speech and language development is the same part that is most affected by stress and violence when the baby is developing? What is the Government’s policy response to that research?
Lord Hill of Oareford
I am not aware of that research. I am sure my noble friend will be able to send it to me, and I will be very happy to look at it. The basic policy response of the Government on this is to improve the identification, first of all, and the assessment of these problems, to improve the support that we give to teachers and others working in early years settings, to work with voluntary organisations working with parents on this and to try to tackle it across a range of fronts.
Baroness Howarth of Breckland
Does the Minister agree that this Question is about disabled children, and that disabled children need this sort of linguistic help throughout their educational career, particularly when they come to adolescence and early-adult years? What provision is he ensuring for those colleges and special schools where these disabled young people continue to attempt to develop their skills? I declare an interest as the president of Livability, which has two colleges and a school.
Lord Hill of Oareford
In terms of the range of measures I have outlined in pre-school, school and later, we need to focus on this. I will, if I may, see if I can get some better particulars on the precise point raised by the noble Baroness and will follow up with her at a later date.
Lord Cormack
My Lords, in this age of technology, is my noble friend sufficiently satisfied that there is proper provision for books in primary schools and for children to be read to by those who truly understand them? In that context, would it be worth while piloting an initiative with local dramatic societies to encourage their members to adopt a school and to go into primary schools so that children can hear the language spoken and read as it should be?
Lord Hill of Oareford
I agree with my noble friend about the importance of books and reading. It is also the case that technology can play a crucial part in helping children to read, particularly some of those who have the greatest problems from a special educational needs point of view. I do not think it is an either/or choice, and I do not think my noble friend was suggesting that. I agree that getting children to have a love of language is vital, and I say that as the child of what in the old days was called a speech and drama teacher. I grew up with that, and I know the way that it can help.
Baroness Whitaker
One of the problems of children who have a language disability is the lack of integration, in relation to speech therapists, between the health and education services. What can the Minister do to make that better?
Lord Hill of Oareford
My Lords, one of the consequences of the approach we are developing through the SEN Green Paper is to address precisely the point that the noble Baroness raises: how to integrate health and education services better. As she will know, our ambition is to move to an integrated assessment and a single health and education plan over the next few years.
Lord Elystan-Morgan
Would the Minister consider looking at the statutory definition of children with special educational needs to see whether it is wide enough to cover the problem that my noble friend has raised in this Question? Will he also draw to the attention of courts exercising a family jurisdiction that failure to read at a reasonable age is in fact a substantial deprivation and could constitute significant harm within the meaning of the Children Act?
Lord Hill of Oareford
On the point about the definition, there is a well established definition that is fairly broadly drawn, but I will take the point up with my honourable friend the Minister for Children. If there is anything to report, I will come back to the noble Lord.
Kosovo and Serbia
(13 years ago)
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The Earl of Sandwich
To ask Her Majesty’s Government what progress there has been in the European Union’s negotiations with Kosovo and Serbia.
The Minister of State, Foreign and Commonwealth Office (Lord Howell of Guildford)
My Lords, the Government continue to support strongly the dialogue that the EU facilitates. This plays a key role in building practical co-operation between Kosovo and Serbia and in helping to normalise relations. This is crucial for both countries to move towards eventual EU membership as well as for stability in the region. To date, the dialogue has secured agreements on freedom of movement, custom stamps, mutual recognition of university diplomas, the sharing of land and civil registries and integrated border management. We urge both parties to implement fully the agreements reached and to work constructively towards achieving further progress.
The Earl of Sandwich
My Lords, I agree with the noble Lord. Kosovo has been a special concern of this country since NATO’s intervention only 12 years ago. However, the shadow of Serbia remains over the north, which has become a virtual no-go area. EULEX law officers are not able to go there; even NATO is restricted. What can the Government do to speed up the European Union dialogue and also to persuade those other member states—Spain, Cyprus and others—that they must recognise Kosovo? There is a conflict around the corner and Kosovo’s very future is at stake.
Lord Howell of Guildford
The noble Earl is absolutely right. This is not a smooth pathway and at every stage Serbia must be encouraged to participate in the dialogue over Kosovar independence in order to see its way into EU membership. As for the five countries of the EU which do not go along with the independence position—Cyprus, Greece, Romania, Slovakia and Spain—for reasons which one can certainly recognise, we and the rest of the EU engage with them. We seek their constructive involvement. We do not expect them to change their minds overnight, but they all support the broad aim of the EU representative, Robert Cooper, and his team in seeing a way forward for Kosovar independence and a Serbia that accepts that constructively, works toward it and paves its own way towards EU membership.
Lord Ashdown of Norton-sub-Hamdon
My Lords, would my noble friend agree that Serbia’s progress towards European Union membership, which we would all like to see, will be impeded if Belgrade cannot make it clear that it is opposed to the partition of Kosovo, as it must be also to any attempt by the fellow Serb, Milorad Dodik, to break up the territorial integrity of Bosnia and Herzegovina? Would he also agree that Pristina’s chances of getting the wider recognition that we all wish for, which the Minister has mentioned, will be impeded if it is not able to take more concrete steps to assure the rights of minorities in Kosovo, especially of the Serb population?
Lord Howell of Guildford
I am very glad that the noble Lord made it back from abroad to make those two very valid points. Of course, he is absolutely right that we must ensure that Serbia is not minded to retain the utterly destructive views of the partition of Kosovo, or indeed Bosnia—so yes, very much, to the first point that my noble friend makes. The Kosovar Government have made some progress in the protection of minorities but he is absolutely right that major challenges remain, notably with regard to Kosovo Serb communities in the north. We urge the Kosovar Government to do all they can to guarantee the rights, identity and culture of Kosovo’s minority communities and set out a comprehensive strategy for the north, where the difficulties are acute, as my noble friend knows, to cover areas such as health, education and employment. These are two areas where I totally accept what the noble Lord says.
Lord Liddle
My Lords, the Opposition thank the noble Earl for his timely question, and welcome the progress made in normalising relations. Will the Minister convey our congratulations to the distinguished British diplomat, Robert Cooper, on the role he is playing as EU mediator working to achieve integrated management of border crossings? Does the Minister agree with me that this demonstrates the value of the new External Action Service in strengthening the capabilities of the European Union? How does the recent progress affect the prospect of negotiations being opened for Serbia’s membership?
Lord Howell of Guildford
I hope the answer is that it will be positive. The noble Lord is right. Robert Cooper is an extremely able servant of the European Union and, indeed, citizen of this country. The role of the EAS is relevant, although I know that the noble Lord is the first to recognise that with a number of international organisations down there—the UN, the EAS, the ICO and so on—co-ordination is very important. I cannot give an estimate of the speed of progress. It will all come up at the European Council tomorrow. We may see some progress after that but I cannot predict it.
The Lord Bishop of Exeter
My Lords, with the EU’s attention currently and squarely focused on the financial crisis within its own borders, is there not a real danger that there will be less time and energy to understand or respond strategically to events in its most immediate neighbourhoods? Will the Minister give an indication as to how the eurozone crisis has impacted on the EU’s foreign policy and its ability to deploy soft power in an area such as the Balkans? Will he also tell the House whether, on the expiry of the mandates of the International Civilian Office in Kosovo and the EU Rule of Law Mission in Kosovo, EULEX, these mandates will be renewed?
Lord Howell of Guildford
Yes, I can tell the right reverend Prelate that the mandate for EULEX will be renewed. As to the broader question, clearly the minds of the leadership of the European Union are distracted by the eurozone problems but I do not see that they should impact necessarily on the expertise and determination being applied by the EU authorities in pursuing the dialogue and seeing that Serbia recognises the need to accept and accommodate the independence of Kosovo in its thinking, attitudes and policies so that it can go forward to membership of the EU.
Cycling: Accidents
(13 years ago)
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Lord Harrison
To ask Her Majesty’s Government how many accidents have been caused by cyclists riding on pavements and how many cyclists have been charged with riding on pavements in the past year.
Earl Attlee
My Lords, in 2010, there were 680 reported personal injury road accidents involving cyclists on the footway on GB roads. The Department for Transport does not hold data on who caused such accidents. In 2010, 342 defendants were proceeded against in a magistrates’ court for the offence of cycling on a footway. However, this offence is normally dealt with by a fixed penalty notice and we do not collect information centrally on the number issued.
Lord Harrison
My Lords, one evening recently my wife and I stepped out to go to our local Chinese restaurant in Chester to be met by a young man on a bicycle advancing at speed. When confronted and challenged, he told us with an entirely straight face that, as he had no lights on his bike, he was obliged to ride on the pavement. Will the Minister first strengthen the powers of the police and community support officers to intervene where these cases happen? Will he intervene to improve the primary education of our young people learning about the art of cycling? Finally, will he improve the road environment for cyclists who mistakenly believe that it is legitimate to ride on the pavement as a result of the number of deaths attributable to the problems of cycling on the roadway?
Earl Attlee
My Lords, I know that all noble Lords are very concerned about these issues and I come to the Dispatch Box with some trepidation on this Question. PCSOs, like constables in uniform, can issue fixed penalty notices in respect of an offence of riding a cycle on the footway contrary to Section 72 of the Highways Act 1835. I do not know about their powers regarding lights. Youngsters may be more susceptible to a word in their ear rather than a fixed penalty notice. Education is an extremely important part of the process.
Baroness Butler-Sloss
My Lords, speaking both as a driver and a pedestrian, what can be done to encourage cyclists not to cross the red lights and not to try to run down pedestrians on zebra crossings?
Earl Attlee
My Lords, I thought I would get a question about red lights. We are extremely concerned about cyclists failing to adhere to the law, but noble Lords will understand that this is an operational matter for the police, who can best judge where to devote their efforts.
Lord Bradshaw
Does the noble Earl agree that there is antipathy between all classes of road users? For example, bus drivers hate cyclists, pedestrians hate cyclists and motorists hate lorries. However, it is important that the classification of what PCSOs and local authority wardens are able to do is reviewed, and ensure that all chief constables and wardens have the powers, which I do not believe they do, to intervene not just in cycling on pavements but also in all sorts of moving traffic offences.
Earl Attlee
My Lords, the Question is essentially about cycling, and in respect of offences, I have already said that education is more important than enforcement, especially with youngsters. Frankly, it is not realistic to issue a fixed penalty notice to a 10 year-old.
Lord Young of Norwood Green
My Lords, as someone who cycles into the House every day, I cannot help feeling that I could paraphrase George Orwell by saying that this sounds like, “Four wheels good, two wheels bad”. I experience many irresponsible motorists on my journeys. There are motorists who think it is okay to overtake on a humpbacked bridge and those who think it is okay to go on the wrong side of a traffic island to overtake, not to mention the motorist who kindly almost ran me over on a roundabout earlier this week. Does the Minister agree that we should be encouraging more people to cycle, given that we want a low-carbon economy, and that we should also be encouraging responsible cycling and driving?
Earl Attlee
My Lords, I absolutely agree with every word the noble Lord has said. I encourage all noble Lords and motorists to regularly read the Highway Code because the contents do change.
Baroness Knight of Collingtree
My Lords, does my noble friend recall that it is not many months since I asked a Question with regard to the education of those who seek to ride bicycles, bearing in mind that every other road user has to pass some sort of test or know what he is doing on the roads? Since that is linked with my noble friend’s answer to the question before last, can he say whether he thinks it would be possible to do more about educating cyclists before they hit the road and a lot of pedestrians?
Earl Attlee
My Lords, my noble friend makes an important point. That is why we have supported the development of the National Standard for Cycling and the related Bikeability training scheme. We have made a firm commitment to support Bikeability for the lifetime of the current Parliament and we are providing £11 million this year to local authorities and school games organisations so that 275,000 10 to 11 year-olds can benefit from on-road level 2 cycling training.
Lord Sugar
My Lords, from my recollection, the noble Earl has spoken on this subject several times. He has talked about the impracticality of licensing cyclists, which I agree with. However, can he inform us whether it is mandatory for cyclists using the roads to carry some form of identification on them? In the United States of America, for example—my noble friend Lord Young and I are big cyclists—we are told to carry identification so that the police can take action against people who ride on pavements or jump the lights. If you do not have identification with you, they will confiscate your bike and it is up to you to get it back by paying a big fine.
Earl Attlee
My Lords, I can assure the House that we have no intention of requiring cyclists to carry identification.
Libraries: Access
Lord Collins of Highbury
To ask Her Majesty’s Government what steps they intend to take to improve access to libraries in the light of research by the National Literacy Trust published on 1 December about low levels of book ownership by children.
Baroness Rawlings
My Lords, library authorities deliver many successful programmes to encourage reading. More than 780,000 children took part in the Summer Reading Challenge this year. The Arts Council’s libraries development initiative, announced before the National Literary Trust’s research was published, will explore the challenge for libraries to make certain that their books and reading remain engaging, relevant and exciting.
Lord Collins of Highbury
I thank the Minister for that response. As I know only too well from my own upbringing, libraries are the only source of books for many children. Does the Minister believe that a significant number of library closures in an authority—as we have seen up and down the country, in both rural and urban areas—would breach the definition of,
“a comprehensive and efficient library service”,
in the Public Libraries and Museums Act 1964?
Baroness Rawlings
My Lords, I imagine that the noble Lord, Lord Collins, loves libraries and books as much as I do, as I understand that he was an assistant librarian in the 1970s. We are all naturally concerned if any library closes, but they are a matter for local authorities. As robust data about the library sector are only published annually, we do not know the exact figures. The DCMS supplements those data by monitoring proposals about changes to library services across England through information gathered from our correspondence and from media coverage and relevant bodies such as the Arts Council England. But we share the noble Lord’s concern.
Baroness Gardner of Parkes
My Lords, the Question refers to low levels of book ownership. Many children treasure their books and keep them always, but lots of families now recycle books and give them to charity shops. Would it not be very good to encourage them to do that, so that more people could buy those books at the very low cost that charity shops are willing to charge? Children would then enjoy reading more and have the sense of ownership that adds to the experience and is the one thing missing in a library.
Baroness Rawlings
My Lords, my noble friend has a very good point. Recycling books, especially the low-cost books that one can now get on Amazon, is a great help to public libraries. However, people do not go to public libraries just for books. Libraries offer a way of life, encouraging reading in every way and providing solace for some people who may not have it at home.
Lord Borrie
My Lords, the Minister mentioned that public libraries are a matter for local authorities—yes, indeed. However, as my noble friend who initiated this Question said, the public libraries Act requires local authorities to provide an effective and efficient service. Magistrates in the West Country have recently ruled that the cuts in certain counties there are illegal because of the Act to which I have just referred. Does the Minister accept that decision, or does she think that there should be an appeal against it to try to justify these most unfortunate cuts?
Baroness Rawlings
The noble Lord, Lord Borrie, brings up the cuts once again. Libraries are the domain of the local authority. If the Secretary of State sees that there is undue reason for closing a public library, he can intervene. There is a form of testing that he looks at—it is not a fit-and-proper test, but he has the opportunity to investigate.
Lord Alton of Liverpool
My Lords, as we come to commemorate next year the important Jubilee of Her Majesty the Queen, would it not be a suitable initiative for the Government, perhaps in partnership with private sponsors, also to commemorate next year’s bicentenary of Charles Dickens and this year’s 400th anniversary of the publication of the King James Bible by making presentations of those books to children in our secondary schools? That would be a way not only of marking the Jubilee year but of increasing the holding of books by children in our country today.
Baroness Rawlings
The noble Lord, Lord Alton, raises a very interesting question. It would be an extremely good idea, come the Jubilee, to have partnerships like that. The Government announced just this week that the possibility of extra philanthropic funding for schemes such as partnerships for the Jubilee is being looked into. Speaking of the Jubilee, I commend Her Royal Highness the Duchess of Cornwall for all the work that she does in this area to encourage young children to read.
Lord Tope
My Lords, building on the excellent work done by the Reading Agency through its Summer Reading Challenge, to which the Minister referred in her opening comments, will she tell us what work her department is doing with the Department for Education to encourage schools and local libraries to work in a joined-up way to tackle literacy issues?
Baroness Rawlings
My Lords, my noble friend Lord Tope asks a question that follows on very nicely from the first Question, answered by my noble friend Lord Hill. The Government are doing a great deal with the Summer Reading Challenge. Some 97 per cent of UK library authorities participate in the challenge, which encourages four to 11 year-olds to read six books over the long summer holiday. There are many similar projects; time is running out now, but I can write to my noble friend with the details.
Subterranean Development Bill [HL]
Merits of Statutory Instruments
The Chairman of Committees
That Baroness Eaton be appointed a member of the Select Committee in place of Lord Lucas.
Business of the House
(13 years ago)
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Lord Strathclyde
That Standing Order 40(1) (Arrangement of the Order Paper) be dispensed with on Tuesday 13 December and Monday 19 December to enable proceedings on the Health and Social Care Bill to take place before oral questions.
Lord Foulkes of Cumnock
My Lords, will the Leader of the House confirm that this Motion has been tabled after an agreement through the usual channels and that no such Motion would ever have been tabled without such agreement?
The Chancellor of the Duchy of Lancaster (Lord Strathclyde)
Yes, my Lords. I can actually go a bit further and say that relations in the usual channels between the Opposition and the Government are extremely cordial at the moment—and long may that continue, because that is the normal course of events. Certainly I cannot imagine the circumstances in which a Motion like this would be put down without the agreement of the usual channels.
UK Manufacturing Industry
Lord Haskel
That this House takes note of the development and retention of manufacturing industry in the United Kingdom.
Lord Haskel
My Lords, it is not true that we do not make anything any more. We are the seventh largest manufacturing nation, and in high technology manufacturing, we stand proudly among the major economies. In cars, aircraft, pharmaceuticals, chemicals, food and space we perform well. Manufacturing is 11 per cent of our economy, but 46 per cent of our exports.
How do I know that? In recent months, the Government have been making a conscious effort to talk up manufacturing—talk it up because we are told that manufacturing is going to play a major role in rebalancing our economy. It will be a rebalancing away from financial services, away from the south-east towards the rest of the country, away from spending towards saving and away from consuming towards creating. Manufacturing is to be central to this.
Now, at the same time, the Office for Budget Responsibility tells us of difficult times ahead and the OECD tells us that our economy is likely to contract. In the face of this, initiatives such as the “Make it in Great Britain” campaign, launched last month by the Government to celebrate the country’s world-class manufacturers, are inadequate and perhaps counterproductive. Yes, it celebrates manufacturing and makes us feel good about it, but it does not tell us that too much actual manufacturing has gone abroad and continues to go overseas. This is what we need to address. This is why, to fulfil these expectations, manufacturing not only has to develop but has to survive. This is what this debate is all about.
This is a huge topic and I shall only be able to touch on a small number of aspects, so I am most grateful to all noble Lords who are speaking in this debate so that we can hear about their special concerns, learn from their specialist knowledge, benefit from their long experience and hear their suggestions. I hope the Government are listening.
The first point I will make is that, if you are going to retain and develop our manufacturing sector, there needs to be a better understanding of what manufacturing actually is in 2011. It is not separate from services—successful manufacturers provide services. One of our finest companies, Rolls-Royce, makes aeroplanes. Did any noble Lords see that absorbing programme on BBC2 on Sunday evening, about how the engines are made? The point is that the airlines do not buy an engine, they buy so many thousand hours of flying time, and each engine is continuously monitored form Derby to ensure that it is working properly. It is given the service it needs by Rolls-Royce wherever the plane lands. Service and manufacturing go together.
This is why the scope of manufacturing is far wider than the Government seem to imagine. It includes things like software, branding, languages, ICT skills and advanced business processes. These are all parts of manufacturing, as well as the metals, materials, products and engineering. Manufacturing, too, has become part of the digital economy. We have a fine car industry, which exports something like 80 per cent of its production. Is the Minister aware that electronics now account for between 15 and 30 per cent of the production costs and that the industry tells us that this is only going to increase? This is the way that many of our manufacturers are developing. Many expect that in 10 years’ time, the digital economy will be equal in size to the physical economy. This kind of manufacturing can only be built on the firm foundation of an existing manufacturing sector. You need an industrial base to build it on, and unless we retain this industrial base, all the fine work done by our science and technology sectors will benefit others. This is why retaining manufacturing in these hard times is so crucial.
Moving us towards this high-value, knowledge-intensive manufacturing combined with service is the task of the Technology Strategy Board. The TSB helps manufacturers by doing the strategic work. It identifies those areas or platforms of economic growth where their businesses can thrive and it provides finance through competitions. This is especially valuable for smaller businesses—companies, perhaps in the supply chain, without the resources to do this work themselves. By bringing together all the aspects of a new technology or a business-growth platform, plus the money, it helps them gain the competitive advantage by speeding up the transfer of knowledge. I declare an interest as the honorary president of the Materials Knowledge Transfer Network. It brings together 4,500 members to embrace all the communities involved in metals, materials and composites, to take advantage of our advanced materials technology and engineering.
There are two other communities that we have been particularly anxious to embrace: science and design. On design, I make no apology for repeating what I said on 24 November in a debate in your Lordships' House on government procurement. Imaginative, sensible and innovative design is one of the foundations of a modern manufacturing economy. It is not an expensive add-on to make something look good. It drives fitness for purpose and raises the quality of use. As Vicky Pryce said in her report the other day, design converts something mundane into something desirable, like the iPhone. This is why I was amazed that during a 20-minute wind-up speech in that debate the Minister spoke of how the Government were going to use procurement to help British industry, but the word “design” was not mentioned once—and this in a House which regularly debates the creative industries. The Government really must get their act together on this.
The Government talk a lot about science and innovation and their importance for manufacturing and economic growth, and they are right to do so. New and better products and new and better ways of making and servicing them raise productivity and profitability. But the point about manufacturing innovation is that you get a double effect. If you make an innovative aeroplane, this enables and facilitates innovation in the airline industry. If you make an innovative piece of medical equipment, the nation's health benefits through medical innovation enabled by the new machine. It turns out that, if you measure the total innovation in the economy, because of this double effect, manufacturing accounts for 42 per cent of the total, even though it is only 11 per cent of the economy.
Where does this innovation come from? It comes from our science base. Fortunately, the Government accept this as part of the empirical evidence about the economic returns from science. Sadly, I do not think that the financial sector has bought this argument, except perhaps in the ICT sector, where time horizons can be shorter. It is due to short-term investment horizons that British manufacturers do not compare well with our competitor nations in research and development. As a result, we are no longer at the cutting edge of technologies where big projects are getting under way—in sustainable or nuclear energy, for instance. It is partly because of this that some of the foreign-owned, large manufacturing companies are becoming increasingly concerned about the health of their domestic suppliers. If they have to import components from abroad, the logical conclusion is that the final assembly can move offshore, too.
The recent financial crisis has thrown into sharp relief the financial management and corporate governance of our manufacturing companies. The absence of any serious policy to retain and develop our manufacturing companies has meant that they, too, are the victims of the same shareholder value philosophy which has pervaded much of British business for years. I congratulate the Government on getting John Kay to look into this—at long last.
The Government call on shareholders to be active in demanding a longer time horizon in business management—the call is for stewardship—but so many of our manufacturing companies are so-called “ownerless corporations”. The real problem is that the link between owners and boards is broken. That is what the Government should be trying to fix, not just excessive pay. That is a symptom, not the disease. Only an engaged and committed ownership will see through the development and retention of our manufacturing companies. The short-term focus of fund managers and their clients runs counter to this, but at least there is now talk of getting rid of quarterly reports. Manufacturing businesses require stewardship. They are not there for the quick buck.
There are several important issues on which I have not touched. Skills and training is perhaps the most important. Increasing the number of apprentices and training courses is of course welcome, but for manufacturing it is the quality and standard that is important. Most apprenticeships on offer are far from the three-year engineering course. Meanwhile, the Government are making life a lot more difficult for the 450 FE colleges where many manufacturers look for their recruits. It is not easy to match skills training with the rapid developments in manufacturing. The answer lies in starting early—at school, if possible. Yet which subjects are facing curriculum cuts? Why, design and technology are, of course.
Trade is important and, yes, the Government are right to encourage exports because those lift standards and enlarge markets, but the Government have to do a lot better. On 22 November, it was reported that the fund to encourage small and medium-sized enterprises to export had signed up just four companies since its launch eight months previously. Obviously, either something more is needed or the qualifications have to be changed. The encouragement that I would like to see coming loud and clear is that exporting is an investment, not a cost—especially exporting to the single market, where it has become easier since every member state now has a single point of contact telling exporters, in English, exactly how to do business in their country. It was your Lordships’ European Committee that helped fight for this. Incidentally, I have never seen this mentioned in any government guide to export. Has the Minister seen it? She will be impressed if she has a look.
Would that there were a single point of contact for British manufacturers dealing with the Government. Over the years, BIS has been constantly reshaped, rebranded and given different responsibilities. I think that its largest budget today is higher education. Manufacturing's big concern, energy, is in environment; employment is elsewhere. So is drawing the line between competition and free trade, which manufacturing needs, and economic warfare, which it does not need. The truth of the matter is that there is no coherent policy at government level for manufacturing. Some may think that nothing extra is needed other than to cut red tape, employment rights and taxes. Yet if you agree that government has a part to play in shaping the manufacturing sector and that government has a role in fulfilling the ambitions and expectations that we have for manufacturing, somehow all of these threads have to be drawn together.
They have to be drawn together because all these issues that I have tried to outline are crucial for the success of our manufacturing sector. The serious thinking has to be coherent if it is to be effective. On 29 November, in the Financial Times, a poll of manufacturers reported that most directors of companies participating in the survey cast doubt on the Government’s efforts to encourage a shift in investment and output towards manufacturing. I am sure they had their views confirmed yesterday, when they heard how the Prime Minister is going to the euro summit all fired up to defend the interests of the City. Would it be presumptuous to join the front page of this morning's Guardian and ask: what about the interests of manufacturing? I hope the Minister is going to tell us that the Government have a coherent and balanced policy, and a plan to use all the levers of active government to support, enable and empower manufacturing, from prime contractors down through the supply chains. I beg to move.
Baroness Garden of Frognal
If noble Lords will forgive me for just one moment, the timing for this debate is very tight. Back-Bench speeches should be no longer than six minutes, so when the “6” comes up noble Lords should please finish their contribution.
Lord Jenkin of Roding
My Lords, we are extremely grateful to the noble Lord, Lord Haskel, for giving us the opportunity to debate this subject. I am going to follow him on skills in a moment but, with regard to what the Ministers are saying, I can only imagine that he has not read the report of the all-party manufacturing group held last month, at which my noble friend Lord Green of Hurstpierpoint answered a great many of the points that he has made about small businesses and exports. The central point that he made was that of course the Government and UKTI have to do more, but there needs to be a change of attitude on the part of small companies.
I need no persuasion about the importance of manufacturing industry. Before I went into the House of Commons I spent 13 years in the chemical industry, and I have always felt that it is a great pity that there are not more Members of another place who have done the same sort of thing.
I turn to skills. My honourable friend John Hayes, the Minister for Skills and Training, is doing a splendid job in grappling with the situation that he inherited. In particular, he has recognised, as I am not sure our predecessors did, that if you are going to have more apprenticeships and skills councils, they must be employer-led. That is what is now happening. Those skills councils that have been employer-led have been very successful. I shall mention only two of them: Cogent, which deals with the skills and training for many of the STEM industries, and the National Skills Academy for Nuclear—I declare an interest as its honorary president. They are now wholly independent of public finance because they are now being financed by industry. That should be applauded. Yet one hears of so many problems regarding the lack of skills.
Another of my interests that I should declare is that I am honorary president of the Energy Industries Council. That is the trade association that represents more than 650 companies in the energy supply chains, including a large number of small and medium-sized enterprises. It holds trade shows around the world. Last month my noble friend Lord Howell of Guildford was pleased to visit a two-day trade fair that the EIC was running at Olympia, and only last week he did the same at a trade fair in Dubai. On both occasions he was hugely impressed by the quality and range of the manufactures that are available from the companies that were exhibiting on the stands, but on both occasions my noble friend heard the same complaint: that they cannot get the skills and the skilled people necessary to deliver the export orders that they are now getting from around the world.
I heard the same point at another meeting. A speaker on behalf of Centrica made exactly the same point: it cannot get the skilled labour. Yet, as we know and grieve, more than 1 million young people aged 18 to 26 are described as NEETs—not in education, employment or training. What are the barriers? Why can this not happen? Is it attitudes? Yes, that is certainly one of those barriers. Is it reluctance on the part of employers? Possibly. However, the biggest barrier—I heard this the other day from the vice-chancellor of the Open University, who was extremely persuasive—is a lack of proper information and careers advice to young people. Many of them do not know about the opportunities that are open to them to gain skills and so begin to qualify for jobs for life. What is my noble friend’s department doing to strengthen the provision of information to young people?
A major new project is emerging in Yorkshire—what will be the world’s biggest potash mine. It involves an investment of £3 billion and 1,000 new jobs, all of which will need to be skilled. What is the company doing? It is going into the schools and the further education colleges in order to persuade the students there of the importance of gaining skills so that, when the company starts to recruit people, they will be able to operate the equipment. Last night I heard a very interesting comment on this from the former chief executive of the Association for Science Education, who said:
“That would not have happened 10 years ago”.
There has been a significant change in attitude, but many more companies need to do that.
I end by offering a bouquet to my noble friend. The department’s Talent Retention Scheme, which was launched by my honourable friend Mark Prisk, is a scheme whereby skilled people who are losing their jobs can be picked up by other firms that are looking for people. Participation in the scheme is beginning to grow but I wish that more companies would subscribe to it. I hope that my noble friend will be able to confirm that.
Lord Bhattacharyya
My Lords, I thank my noble friend Lord Haskel, who is a great ally of British manufacturers, for securing this debate. I have had many private debates with him. I am sure that he is among the very few people in this House who understand manufacturing.
I also wish to declare my interests as set out in the register, and draw special attention to my role as the founding chairman of the Warwick Manufacturing Group. I come to this topic with a great deal of personal interest and experience, having worked with, and for, leading British and global manufacturers for some 45 years. In that time I have participated in many debates about the past decline and worrying future of British manufacturing. I have no desire to go over those debates again. After all, since the crash, manufacturers have provided the good news in Britain’s economy. We have had eight quarters of manufacturing GDP growth, business investment has increased for the past sixth months and while yesterday’s output figures were poor, a “maker’s recovery” continues in key sectors; for example, automotive. For the first time in decades, manufacturing is seen as key to Britain’s growth, not our biggest problem. If we are to solve the challenge of unemployment, we know that a jobless recovery through building warehouses to hold imports to be sold in supermarkets, all paid for on credit, is no solution and never has been. Do we want an economy based only on warehouses and office parks that I see littering our countryside, or a recovery which relies on taxing highly paid clerks in the City? No, we need to make the products that the world needs.
In that spirit, there is news in the Autumn Statement to applaud: increased infrastructure spend; business angels tax relief for small businesses; and credit easing to support British firms seeking finance, although the devil will be in the detail. This stimulus package—for that is what it is—is a step in the right direction, but it is only the first stage of a long-term change. The transformation that we need cannot be delivered at the flick of a switch or by issuing a press release from Whitehall. We need a better, broader capitalism, and that means developing better products for broader markets. This is a point that the leader of my party has made very powerfully. The global market is consumer driven. Consumers, especially British ones, care little where goods are made, only that they are fit for the intended purpose, and I do not blame them.
Government should support the development of globally competitive products in Britain in three bold ways. Procurement is the essential first step. Without a big market to aim for, a focus on new products will not appear profitable for many businesses because in global terms the UK market is small. The UK defence sector prospered because it could rely on a high-demand customer—the Government. Whatever the weaknesses of defence procurement, its great strength is that it procures new British products. We need to expand that insight to the NHS, housing, infrastructure and energy. Compare Hitachi in Newton Aycliffe with Bombardier in Derby. One is secure through procurement, the other is at risk in its absence.
Secondly, we have debated research impact many times in this Chamber. I welcome the progress that the Business Secretary and the Science Minister have made on life sciences and the NHS, but why does this apply to such a limited field? What is the point of a school of manufacturing, if it is not judged on impact? We must make impact the cornerstone of assessing all the applied sciences. We need to make applied research an essential tool for businesses, not a parade of expensive white elephants.
The third step to securing global scale is to attract overseas innovators, whether through asset purchase or partnership. We must attract companies that will invest in the UK and can increase exports. They know what growing markets need and how much they are prepared to pay. Overseas investment also focuses UK plants on being globally competitive. A plant owned by a Thai firm knows how it must change to compete with Thai factories. I am talking about steel.
Next, we should help British firms to develop new products. Too often, we talk a lot about selling but do not make much worth buying. We put our faith in trade delegations without worrying if the delegates have goods to sell. It is all right—the only thing they sell is the financial sector. Then they are worried. I know that in India, for example, all that trade delegations want to sell is the financial sector, but they will not get in to such markets because they are very highly regulated in most countries.
I am proud of our successes—from JCB to BAe and JLR—but we need many, many more. Today, it is hard for a manufacturing business to meet such product challenges. Why? I am often told it is because medium-term finance is hard to secure. That is why we need a real industrial bank. Why not use funds destined for banks through quantitative easing to establish a new ICFC? Success in expanding a firm needs a big high-volume market to aim at, quality products that compete in global markets, and finance to develop those products and processes. The same applies to procurement policy, support for R&D impact and inward investment, and providing the finance needed for expansion. Government can use the current crisis to mould policy for a generation if we have the long-term ambition. Ambition is essential. Caution is no virtue if Britain’s makers are to march. Think of post-war Germany, which built KfW and Fraunhofer from nothing.
Lord Lee of Trafford
My Lords, Paterson Zochonis—now PZ Cussons—went public in the 1950s. It was capitalised then at just over £1 million. Today, it is capitalised at £1.5 billion. Shareholders have not had to put in a penny of further capital. The company employs 9,000 people worldwide, particularly and substantially in Nigeria and Indonesia. PZ, together with Nichols in soft drinks manufacture and Halsteads in floor coverings, are probably the best three examples of manufacturing industry based in Manchester—the home city of the noble Lord, Lord Haskel, who I thank for introducing this debate.
What characterises these three companies is that they are all family controlled. They have been carefully stewarded through the generations. Had they not been family controlled, takeovers would almost certainly have taken place in all three cases. I had the privilege of being a non-executive director of two of these companies, and my family invests in all three. Yesterday, JCB, which has been referred to, announced that it was investing £31 million in designing and manufacturing the next generation of heavy-duty engines to give their products a,
“huge competitive edge across global markets”.
That is another example of an excellent family business. As the noble Lord, Lord Bhattacharyya, said, we just need many more. Contrast this with yesterday’s announcement from Cadbury, following the acrimonious takeover by Kraft, that there will be a couple of hundred further unfortunate redundancies.
We have global positions in aerospace, pharmaceuticals, and food and drink, but the ownership—the siting of headquarters and manufacturing plants—is complex and varies considerably. Take BAE Systems, for example, which we regard very much as a UK company, where probably 50 per cent of the ownership is in overseas hands. It employs more people in America than it does in this country. At present, we have a service-dominated economy but, as has been said, there is a close relationship between a successful manufacturing company and successful service companies. We undervalue manufacturing in this country both in the valuations of many quality quoted companies, making them vulnerable to overseas takeovers, and in the perception of manufacturing as a wealth creator and a career. We need, I suggest, to build bridges between manufacturing and the wider public in this country.
When I was Tourism Minister in the late 1980s, I instigated the first ever conference on what I termed industrial tourism, bringing together the English Tourist Board and the CBI. It was at Centrepoint. The whole idea was to encourage people to visit our manufacturing and for manufacturing plants to open themselves up. Today, many larger companies in ceramics and whisky encourage visitors, as do niche businesses such as Hardy’s in Alnwick, a fishing tackle manufacturer, and Derwent Pencils in Keswick, but we need more.
I shall make four points. First, it should be the norm, not the exception, to open manufacturing plants and processes to visitors—subject, obviously, to health and safety compliance. Secondly, apart from putting a higher tariff on physics and maths, we need a far closer liaison between manufacturing industry and schools. Thirdly, we need much more positive media coverage of manufacturing and the investment opportunities that exist in our quoted manufacturing companies to be brought into people's homes, to encourage potential investors to take their own decisions rather than invest through funds or similar. Fourthly, we should be putting successful manufacturers on a pedestal in this country. They are surely as important as those participating in the big society. What sort of lead do we give here in your Lordships' House? We have many bankers, barristers, brokers, academics, medics, people from the world of advertising and the media, local government, the diplomatic corps and the military, but how many out of 800 in your Lordships' House have real experience of substantial manufacturing industry and exporting? I am not talking about non-executives; I am talking about major executives who have really been involved in wealth creation.
In my final minute, I shall make a couple of quick points. First, there are substantial opportunities in the manufacturing chain to create manufacturing companies in this country. For example, Triumph Motorcycles brings in 90 per cent of its parts from abroad. More could be done to develop the manufacturing chain here. My noble friend and colleague Lord Alliance was telling me earlier that we are now beginning to see a slow reversal, with textile and clothing manufacture beginning to come back to this country. Secondly, the Sunday Times last week reported that of the 100 fastest growing companies 50 per cent were in service, 25 per cent were in retail and only seven that I could identify clearly were in manufacture, so there is a huge job to do.
Lord Bilimoria
My Lords, we had a debate on manufacturing almost exactly a year ago. Looking at the speech I made then, I felt that I could almost repeat it verbatim today. My point is that not a lot has happened and not much has changed in the past year with manufacturing. What has changed is that the economy has become more and more gloomy. The Government's predictions are completely up the spout, with us going into recession almost throughout this year, bumping along the bottom, with the risk of a double-dip recession. On top of that, we have had the domino effect of the subprime crisis, starting four years ago, now to the eurozone crisis, which in turn threatens to pull the whole world into depression.
What has happened to manufacturing all this time? The Government talk about a balanced economy, but what is the reality? In his autumn Statement last week, the Chancellor mentioned manufacturing only three times. What are the Government doing to incentivise manufacturing? It is a sector that in the early 1970s made up 30 per cent of GVA, employing 5 million people, but today makes up just 11 per cent of GVA and employs only half the number, 2.5 million people. I ask the Government bluntly: are they all talk? In fact, are they doing enough talking? Are the Government making manufacturing a priority? Can the Minister respond to this?
I thank the noble Lord, Lord Haskel, for initiating the debate at this time because just this week we have heard that British manufacturing is heading for a sharp slowdown as confidence, orders and output tumble. The EEF and BDO revised their forecasts for 2012 manufacturing growth from 2.2 per cent to 0.9 per cent. In October, the manufacturing sector shrank 0.7 per cent. Furthermore, if the Government were serious about manufacturing, we would be taking steps to incentivise the sector. At the moment, taxes are too high. The 50p tax rate is pushing away inward investment, with national insurance being increased, and employment laws are coming across from the EU with no talk about us repatriating our powers while the EU crisis is going on. It would seem that now is the ideal time to be having that discussion.
What has helped Britain over the years has been our open economy and our flexible labour force. But the more we get hampered by EU regulations, the less attractive we are to inward investors. Manufacturing is about not just home-grown manufacturing, but attracting manufacturing from outside. The Tatas invested in Jaguar Land Rover, a company that was in the doldrums, a company that no one wanted to buy. When the Tatas went to the Government for help, the noble Lord, Lord Mandelson, chose not to support them. They supported themselves and stood by their guns. Look at the company now: even in this environment it has made a £1 billion profit. Tata is an Indian company founded by a Zoroastrian family, my community of which I am proud to be a part. It is now one of the leading manufacturers in Britain.
What about India? India broke on to the world stage through IT, outsourcing and BPO, but it is actually a manufacturing nation, with manufacturing making up 25 per cent of its economy. India wants to increase that. We are going to be left behind. We have the cutting-edge capability which we have heard about. We have the support of the best creative industries, the best design, the best accountants, the best lawyers in the world; it is all there. The knock-on effect is that every two manufacturing jobs created lead to another seven jobs further down the supply chain.
I say to the noble Lord, Lord Lee, that I practise what I preach. As the founder and chairman of Cobra Beer, I always say with pride that, first and foremost, I am a manufacturer. We have a joint venture with Molson Coors, one of the largest brewers in the world, and produce our beer in Burton-on-Trent, the biggest brewery in Britain, where, I am proud to say, in the past year since the previous debate on manufacturing, we have won two Monde Selection medals in the world quality awards, taking our total tally to 55 gold medals in 10 years, most of them produced here in Britain.
We can do it. We are capable of world-class, world-beating manufacturing. The Government have just got to make it a priority. On exports, I am proud to say that in the past year Cobra’s exports, made in Britain, have increased 16 per cent year on year. We are outside the euro. We are in control of our own destiny. In India as a child, when I saw that a product was “Made in Britain”, it said “quality”. We are still capable of being the best of the best.
What about finance? Research shows that 70 per cent of SMEs cannot get finance. As reported through the CBI, a leading bank has been telling clients not to apply for the Government's Enterprise Finance Guarantee scheme, the replacement for the Small Firms Loan Guarantee scheme that helped my firm get off the ground, because the bank does not want to take the 25 per cent risk even though the Government are guaranteeing 75 per cent. The Government have got to make the banks support businesses.
On top of this, are the Government doing enough to create today’s 3i? When the Government backed the creation of the Industrial and Commercial Finance Corporation, which was to become 3i, in 1945, it did so much to nurture the entrepreneurial potential of Britain in bleak times. Can we not create similar large-scale organisation backed by the Government?
To conclude, we have to act now. The situation is getting desperate. Manufacturing means the creation of jobs and employment. It means generating taxes, which means paying for the public services from which we all benefit. I am sorry to say that my impression is that the Government's vision for manufacturing is a little blurred. It needs a target. We need 20/20 vision. Perhaps 20 per cent of GDP by 2020 is a bit ambitious, but the Government need to be focused, concentrating and confident with regard to manufacturing. I do not want to be standing here a year from now quoting from my speeches this year and last year. To quote the poet and Nobel laureate, Rabindranath Tagore, the 150th anniversary of whose birth we are celebrating this year:
“Where the mind is without fear and the head is held high …into the dreary desert sand of dead habit… into ever-widening thought and action… Into that heaven of freedom, my Father, let my country awake”.
Lord Cope of Berkeley
My Lords, it is very good that the noble Lord, Lord Haskel, has turned our attention away from the financial crisis and the eurozone, and given us the opportunity to talk about the real basics of the British economy. I agree entirely with him about the excellence of British manufacturing, and about the unsatisfactory nature of the economists’ definition of manufacturing.
When I was first a Member of Parliament, the Rolls-Royce factory in my constituency in Patchway employed 10,000 or 12,000 people. Now it employs a tiny fraction of that. A lot of the people employed were servicing the factory in one form or another. Now the catering is outsourced to an external caterer, which would count as a service industry, and all sorts of maintenance jobs which were done in-house before are now being put out. That affects the way the statistics look, in total. I am an accountant by profession, and we accountants do not always see things the same way as economists do. It frustrates me that the statistics get distorted in this way.
The other thing that has happened to this factory, and many others over the same period, is that whereas there were enormous workshops full of hundreds of men—nearly all were men—at lathes and milling machines, with supervisors and inspectors checking everything to make sure that very high-tech standards were being adhered to in the machining of the metal, there are now enormous machines, with one man sitting in a little glass box beside them, doing very little except gazing at a computer screen. This means, of course, that there are fewer people employed, even though they are producing more, and pouring out even more high-tech goods.
Despite all the immense challenges of the world today, I am full of optimism over the position of British manufacturing in the world. I agree with the noble Lord, Lord Haskel, that we have lost our capability as far as nuclear power is concerned. However, that is a 10-year story, and more attributable to the last Government than to anything that can be done at this stage. It was lost because of the attitude to nuclear power, which I never shared.
However, I am full of optimism. We remain an amazingly inventive people, full of entrepreneurs. We know that from history, but it remains true today. Businessmen, when asked what they want the Government to do, often say, “We want it to get out of our way”. That is a very understandable attitude, but there are some industries—and the aerospace industry is one which has already been referred to—where the Government are inevitably involved, with a role as a huge purchaser on both the civil and military sides. The UK aerospace industry is second only to that of America. It has a turnover of £23 billion, and good order books on both the civil and defence sides.
Of course, as the noble Lord, Lord Bhattacharyya, reminded us, the MoD has had some spectacular problems in its purchasing, but it is crucial that MoD purchasing is first class, not only for the Armed Forces but for the defence industries. The defence industries employ about 300,000 people. That is half as much again as the whole of the Armed Forces, so that area of the MoD’s responsibility is of great importance. The MoD’s R&D budget is about a quarter of the total spending on R&D in defence, but it is important, as is the support given later on. One could make similar remarks about the pharmaceutical industry, which has been mentioned, and about many other industries that I do not have time to cover.
It is one thing to make things and sell them, but intellectual property is of the greatest importance. I know that my noble friend has an important role to play in this. I noticed the very important article by Sir James Dyson in yesterday's Times about the difficulties his company has in China. Anything the Minister can say about that would help to update us. The single European patent is also being developed and will be important to all our industries.
Overall, I remain optimistic about British manufacturing industry. We should not talk it down, as occasionally happens. On the contrary, we should be proud of the achievements of very many sectors of manufacturing industry and of what the Government are doing through the Plan for Growth in all kinds of ways to encourage it.
Lord Sugar
My Lords, I am grateful to the noble Lord, Lord Haskel, for securing this debate on manufacturing. The noble Lord, Lord Lee, should be comforted by the fact that I am a manufacturer; I know that he is looking for manufacturers in the Chamber today.
I have spent the whole of my business life in the electronics industry. I started my first factory in 1971. It would be fair to say that in those days it was possible for someone to start up a small knife and fork factory and produce electronic consumer products. I am sure that the same can be said for many other commodities including clothing and textiles. In the building in Great Sutton Street, London EC1, where I occupied a floor, the upper floors were occupied by garment manufacturers. The irony is that in Great Sutton Street today the same buildings are occupied by the new-world media industry of web designers and social networking companies.
Some may argue that this is progress, but I argue that while these new-world industries employ some people, at the end of the day and near the end of the line people have to buy hard products. The buck must stop somewhere and there is a limit to where providing services can take us. I think that it is fair to say, with regret, that we have lost manufacturing industry for high-volume consumer products in this country, but fair also to say that design and intellectual property, mentioned by the noble Lord, Lord Cope, are also important and retained by British companies. A classic example is the Dyson company that the noble Lord referred to, which has been very successful in the vacuum cleaner business. The cleaners were produced in this country until manufacturing was taken abroad to a low labour cost territory. Of course, Sir James Dyson will point out that he employs a large number of people in the research laboratories at his headquarters.
Manufacturing of the famous brand Burberry was carried out in the UK but has long since migrated to the Far East. The irony is that prestigious brands such as Burberry are sought by the newly affluent population of China and in Japan. This brings me to my point: while I accept that low-cost commodity items can no longer be produced in the UK, high-quality merchandise can be. The demand in the lucrative export markets is very high for prestige brands where price is not necessarily the issue. The companies that I spoke of could still produce some of their flagship products in the UK and employ quite a few people and set the example of a British brand manufacturing at home, which would create employment and earn valuable export revenues.
The noble Baroness will be pleased to hear that I am not here to criticise the Government. However, I have a couple of suggestions; I am a bit of a detail man. The first is that some of the money in the recently announced £125 million advance manufacturing supply chain fund should be allocated to what I call incubator factories. So many empty premises and industrial estates throughout the country could be converted into specialist factories, where core infrastructure could be installed. This is applicable to various industries; be it electronics or textiles, it does not really matter. On the periphery of the main factory there could be small units where start-up businesses can do their stuff, design their products and utilise the core facilities, paying their way for the utilisation of the equipment and occupancy. Here they could sample their products and make small production runs.
My second idea is based on the lack of patriotism in this country, at the point of purchase. We need to educate the public to buy products that are produced or at least assembled in Britain. We need to change the mentality of the public so that when they go shopping they can help in their little way by purchasing products that are made or assembled in Britain. In the back of their minds should be the thought that, somewhere down the line, their purchasing decision is assisting employment. This new mentality needs to be instilled into the British household. For example, a logo should be produced that states: the product you are about to purchase is British.
The Government need to consider an initiative whereby—in association with, say, the federation of British industries—they come up with a certification scheme for manufacturers and producers of food, clothing, furniture or whatever. That certification should be accompanied by the aforementioned logo. The Government themselves should dip their hand into their pocket and promote this with some form of advertising. I am sure that some noble Lords will tell me that that might infringe all kinds of EU regulations, but I do not particularly care about that—I am sure that there are ways to deal with it. I remember that there was a time when “Made in Britain” was a very proud statement for manufacturers. It meant that the item was a quality product. I believe that we are still capable of producing quality products in this country.
Lord Dykes
My Lords, it is a great pleasure to follow the noble Lord, Lord Sugar. Although he will not remember it, I vividly remember that we first met about 13 years after he started his first factory in 1971. It was when I was visiting Dixons Group in the Edgware Road, which was on the edge of my constituency when I was the MP for Harrow East. Even then one admired someone who was a genuine manufacturer, as he has outlined today. I, too, thank the noble Lord, Lord Haskel, who has immense experience of this subject. He is the ideal person to open this debate. I shall be very brief, partly because the Chamber is dotted with some very interesting and impressive entrepreneurs; some have already spoken—the noble Lord, Lord Bilimoria, among them—and some will speak later.
We have a manufacturing history in Britain and the territories historically associated with Britain, so we see lots of ideas springing up and innovative suggestions being made. There is now a feeling that, at long last, it is time for everybody to give a boost to manufacturing in both the traditional sense and in new products that will be commensurate with the amazing electronic revolution. Many people say that we do not do enough of it, and I agree.
I declare an interest as a representative of the all-party group that supports the Food and Drink Federation. On Tuesday night, Dods hosted a meeting at the Institution of Mechanical Engineers, just across Parliament Square, of leading manufacturers in Britain. Some of these manufacturers were originally foreign-owned. Finmeccanica was originally an Italian company but is now one of the major defence equipment producers in this country as well. There was a panoply of very good examples of what can be done in this country. The combined food and drink sector is one of the most successful examples. Some of these companies are very small and manufacture both food and drink. Some are extremely successful and very well known. They are going from strength to strength and employ huge numbers of people.
I try not to do too many factory visits because it stops me being busy in the Chamber, which is the job of a full-time working Peer, which is my classification. However, I recently went to Coca-Cola’s wonderful and amazing factory in Edmonton. It was a great pleasure. It was immensely impressive to see the amazing electronic revolution that has taken place in its packaging and bottling plant. However, the sober truth is that that huge warehouse in Edmonton employs perhaps only four to seven or eight technicians and engineers who watch the computer screens and occasionally do repairs when an electronic machine goes wrong.
It is no wonder that there is youth unemployment on a massive scale. We cannot solve this problem other than by boosting manufacturing, which requires many people to perform many of the processes involved. We shall otherwise have to rely on retail, which is a huge people sector and excellent for creating business posts. However, the jobs created in this sector are not always skilled. I do not wish to criticise those in the retail sector who would consider themselves at least semi-skilled if not skilled, but many of the posts are not skilled. For the young unemployed, in particular, but also for other unemployed people, including older ones, stacking supermarket shelves is no substitute for finding a decent job in the new, innovative manufacturing sectors of the future.
I was a member of the Stock Exchange for many years. The large institutional firm of which I was a partner—a modern firm with a modern outlook—had a policy of always visiting factories. We did many factory visits every week. In those days, in the 1960s and 1970s, one vividly saw the decline of British industry. It was mainly the management attitudes that dismayed me—and not because I was a left-wing radical, far from it. I was much more of a traditionalist in those days and liked many of the traditional aspects of British industry, whatever sector it was. However, there was an attitude of condescension to the employees.
The idea that trade unions caused the difficulties in manufacturing is totally ludicrous. One saw that company directors were often the weakness. I vividly remember visiting BSA when it started to decline. When I went to British Leyland the visit started at 11 am; we had a visit of an hour and a half and then it was lots of gin and tonics and a huge boardroom lunch, which I think finished at 3.30 pm with one of the directors saying, “I’ve got to go and play golf now. If only the workers in this company would work harder, we’d solve our problems”. Six weeks earlier I had visited Volkswagen at Wolfsburg. The visit started at 7 am; we had black coffee and then a huge factory visit. Lunch was in the canteen with the employees. The directors and the employees sat together and ate together. I was an MP then, and when I came back I had a cup of tea in the House of Commons Tea Room with a very traditional Tory MP. I explained the difference and how shocked I was by it. The British motor industry was in decline then, and the fantastic German motor car industry was a good example of employee participation. The MP was a Tory old buffer—I will not say who it was to save his family embarrassment—and he said to me, “I think I prefer the British way of life”. That was the dismal lesson in those days.
There is no reason for that now, because British industry is very modern and egalitarian in its attitudes. We need more examples in manufacturing of the John Lewis philosophy, in which employees participate as equals. We need fewer glitzy, spivvy takeovers, which are the norm in Britain, as opposed to the long-term Mittelstand development that you see in Germany. I was at a party in Germany where somebody said that they were an engineer, and people crowded around. I heard someone at the Groucho Club say that they were an engineer, and people started walking away. They were really worried about being contaminated by meeting an engineer. Attitudes are hugely important, and that is the beginning of our innovation.
Lord Lyell
My Lords, I shall follow my noble friend Lord Dykes because everything I want to say is on an industry. I learnt about that industry, although it was nothing to do with my youth. It is the pharmaceutical industry, or what the Prime Minister chooses to call “life sciences”. I am probably unique in your Lordships' House in having not one O-level in science. Like my noble friend Lord Cope and, I understand, the noble Lord, Lord Haskel, I was trained as an accountant—a bean counter, though for the purposes of the pharmaceutical industry, I would call it a pill counter.
In 1977, I landed on the Benches opposite. The late Lord Belstead said to me, “You, lad, will cover the Patents Bill”. What did that involve? It involved pharmaceuticals. We call them drugs or, now, life sciences. This industry has been given a very heavy political boost this week by my right honourable friend the Prime Minister, who stressed that the United Kingdom should be a leading place for investment in this industry. However, investment is not the only side of things. The time, skills and disciplines required will take between 12 and 15 years—the scale of many of our careers in your Lordships’ House—to produce what they like to call a blockbuster, a successful product or drug. Chapter 3 of the strategy, the pamphlet that is available for O-level students like myself in the Printed Paper Office, has the excellent title of “Attracting, developing and rewarding talent” for everybody involved in this industry. I hope that we will be able to combine the scientific excellence and commercial rigour that are necessary overall in industry in the United Kingdom but particularly in pharmaceuticals and life sciences.
Secondly, I understand that there is now enormous assistance from all the records of the National Health Service throughout the United Kingdom. Indeed, in some of the pamphlets, I discovered that there are enormous records taken in my own area of Tayside of some aspects of health—I had better not go into which particular aspects; nothing to do with the liver or obesity, but we do not need to worry overmuch about that. There is certainly a huge amount of information available from National Health Service records, and I understand that using these records is going to be one of the priorities of the Government’s strategy: first, in discovering what ailments need to be cured and are a priority; secondly, to carry out trials directed towards the relevance of these problems and diseases.
Then one comes, of course, to the finance. The research and trials are fine but I am delighted to read in the pamphlet—I am afraid that I have perhaps been dozing like Rip Van Winkle with regard to some aspects of the tax thing, but I am sure that my noble friend Lord Cope will be delighted—that there is something splendid called “super-deduction relief”. I was not aware of that in my tax studies, but I understand that is going up from 200 per cent to 225 per cent. I see the noble Lord, Lord Bilimoria, beaming at that. Obviously there will be something in it for him, I hope, and others for whom he has spoken. It shows that the Government are taking this particularly seriously, to try to help all types of businesses, large and small, to get some financial assistance. It sounds quite a lot, that you are writing off twice your investment, but over a scale of 12 to 15 years, perhaps that is no small help.
My third point concerning the life sciences industry is that NICE is supporting both the compliance and the regulation. This is simply essential and obligatory for life sciences and medicine because one is taking care of not just finance, not just these wonderful motorcars that my noble friend Lord Dykes spoke about, but of people’s lives, well-being and health. I strongly support every aspect of NICE carrying out compliance and regulation in this industry. It is no small miracle that 20 per cent of Europe’s successful medical biotechnical companies are here in the United Kingdom. We are indeed world leaders in some aspects of this industry, as the table on page 11 of Investing in UK Health and Life Sciences shows.
I am immensely grateful to the noble Lord, Lord Haskel, for giving us the chance to discuss the excellence of British industry. I am proud to be a mere accountant, a counter of those pills—they used to be beans but we call them something else.
Baroness Donaghy
My Lords, how do we develop a bigger share of the manufacturing marketplace? I think we all know the solutions: a competitive banking system, for more flexible loans; a universal vocational education; a philosophy of long-term investment; and a system of government that is focused on strategic issues stretching beyond a four- or five-year term of office—not a lot, really.
Some noble Lords have talked about their manufacturing backgrounds. I worked on a production line in a pie factory in the Midlands, so I can say that I was a meat pie manufacturer. I was brought up to believe that Sir Frank Whittle was a hero—which of course he was. My father worked as an aero engineer for Armstrong Siddeley. I make the point about Sir Frank Whittle for two reasons. First, it is unfortunately comparatively rare for a child to be influenced in this way. I am a comparative newcomer to the world of Westminster and I wonder what the response of our political classes would be if their children announced that they were going into manufacturing. My guess would be that it would be the equivalent of your child coming home from holiday having married the hotel waiter. Culture change is needed from top to bottom, not least in the industries themselves, which must find ways to fire the imagination of the young.
The second reason for mentioning Sir Frank Whittle is to emphasise the importance of heroes—and heroines—a point made very clearly by the noble Lord, Lord Lee of Trafford. If we look at how Sir Frank Whittle was treated by the establishment of the day, we get some idea of the shortage of heroes, and it is a job we should be doing: the top 50 manufacturing heroes of the century, the top manufacturing hero of the year. I welcome the fact that the £1 million Queen Elizabeth Prize for Engineering, to be overseen by the Royal Academy of Engineering, has been created to elevate the status of engineering. It might help to create more heroes, but does it address the issue of teamwork, collaboration and partnership, which is a feature of much development work today? I have a concern about that.
Having talked about Sir Frank Whittle, it is important that we do not allow the debate to be just a stroll down memory lane. The excellent debate in the House of Commons last month covered the key areas of skills, financing and culture change, and the need for a clear strategy for the future. The right honourable Pat McFadden covered this very well when he said:
“I also believe that we make more than we think and more than we sometimes give ourselves credit for … we can challenge the culture of decline and loss. As a country, we should resolve to be the best place in the world for engineering”.—[Official Report, Commons, 24/11/11; cols. 521-22.]
There are some excellent examples of collaboration between companies and universities. I am a member of the University of Birmingham’s business advisory committee, along with the noble Lords, Lord Bilimoria and Lord Jones of Birmingham—yes, I do get a word in edgeways. The university produces an excellent yearbook on entrepreneurship and innovation, with a foreword by my noble friend Lord Bilimoria. I was privileged to attend the Lord Stafford Awards dinner last month, where close collaboration between industry and universities in the Midlands and eastern area was celebrated. I would like to pay tribute to Lord Stafford for his work in this area. Apart from the well established work at the universities of Birmingham and Warwick, there were other exciting developments, including between Siemens and the University of Lincoln, intended to encourage people into the engineering industry.
Part of the debate in the Commons was around creating a full-time Minister for Manufacturing. The Minister for Universities and Science, Mr David Willetts, indicated that the BIS Minister, Mr Prisk, was,
“for all practical purposes our Minister for manufacturing … He is the go-to Minister for manufacturing”.—[Official Report, Commons, 24/11/11; col. 539.]
There really needs to be more strategic political focus on manufacturing. It is covered by many government departments, and that in itself can be the kiss of death for progress. I conducted an inquiry into the underlying causes of construction fatal accidents and saw then how many government departments were involved. I recommended that there should be a full-time Minister to provide more political focus on the industry, and a resource to provide an overview of the various departmental activities. What I did not say in my report was that a turnover of eight Ministers, with an average stay of eight months, was not conducive to good governance.
That is, unfortunately, the Westminster way but it does not give confidence to industry. When I pointed that out to some civil servants, one said that he thought the construction industry was a bunch of whingers. I met 175 organisations and individuals, and I did not meet a single whinger. They were a group of practical, can-do people who achieve great things for our country and deserve our support.
When preparing for this debate, I was going to make a plea that Governments should try to kick the habit of making grand, intermittent announcements about funding. Unfortunately, this week we have had—guess what?—a grand announcement of a new £125 million fund,
“to boost UK advanced manufacturing supply chains”.
The inevitable press release talks about “a new initiative”. An initiative is of itself new but tautology is always the order of the day on these occasions. The problem with these one-off funds is that they are invariably time-limited and, therefore, cut out long-term planning. The politician’s reply is that it is pump-priming and has to be administered by a department, for which one could read, “project managed by a civil servant whose promotion depends on it”. The criteria for eligibility will be couched in such a way that most people will not apply and the fund will be inadequate.
The support for our manufacturing base really is a matter of life and death for our economy. I welcome the opportunity to speak in this debate and I thank the noble Lord, Lord Haskel, for that opportunity.
Baroness Randerson
My Lords, I make no apology today for drawing on the experience of Wales and its manufacturing. Wales was, of course, a great manufacturing nation. In the past 10 days, Wales has suffered two major blows to its manufacturing employees. First, there is the mothballing of the rolling mill at Llanwern steelworks owned by Tata with the loss of 150 jobs, although there is the hope that they might be brought back when the economy picks up. Secondly, 75 jobs were lost at Hawker Siddeley Switchgear at Blackwood where employees were manufacturing electrical components for trains. These are the latest examples of a steady but steep downward trend in the contribution of manufacturing in a part of the UK, which, as I have said, was a bastion of industry.
In 1990, Welsh industries employed 235,000 people from a population of 3 million. By 2008, this had fallen to 162,000 people, making up 14 per cent of Welsh employment. Estimates suggest that a further 30,000 jobs have been lost since, among them the jobs at Burberry referred to by the noble Lord, Lord Sugar. In 1997, manufacturing was responsible for 28 per cent of Welsh GVA, which had fallen to 18 per cent by 2006. The decline has been pretty well across the board—clothing, textiles, publishing and printing, metal manufacture and mechanical engineering. Above all, in the electrical engineering industry, 18,000 jobs were lost between 2000 and 2008. This was the sector in which Wales had been so successful in attracting inward investment in the 1980s and 1990s under the leadership of the Welsh Development Agency.
This is the crux of the problem. Industries used to be based where the raw materials and the sources of energy were; hence the development of the Welsh valleys, for example. The problem now is that industries are footloose. They go where they can get the best offer and the best skills. In the 1980s and 1990s, the Welsh Development Agency did a superb job attracting inward investment. But that was based on a low-pay model and no country in Europe can establish industry based on a low-pay model now, even if it were morally defensible in the current world. We have to sustain our manufacturing now on other bases.
Sadly, the WDA was abolished a few years ago and Wales no longer has a strong international image to attract inward investments. However, the key issue is that footloose industries now go where the skills are. We need to maintain a strong manufacturing base, of which we should not lose sight when we look at other aspects of the economy and perhaps see them growing and flourishing. There are particular reasons why we want to keep that strong base. First, the pay is relatively good—skilled jobs mean good pay. Secondly, there is a tendency in manufacturing to create, as a proportion, more full-time jobs, and hence better income for the household. The third reason is the export earnings that come from manufacturing. Finally, manufacturing creates other jobs in the supply chain in a way that some other aspects of the economy do not do.
In the 21st century, successful manufacturing regions are those which spot the opportunities, create the skilled workforce required and keep ahead of the game by nurturing technological development. It is a matter of great regret that, for example, Wales as a country is wonderfully placed geographically for the production of a variety of forms of renewable energy but it has failed to develop a manufacturing base for the production of the equipment required for renewable energy production. That is a lost opportunity which, unfortunately, will be difficult to catch up with because other countries are doing it so successfully.
Successful manufacturing economies of the future need a vibrant, innovative university research sector closely linked with local businesses. They need an army of appropriately trained apprentices. I congratulate the coalition Government on the emphasis that they put on the development of apprenticeships, which have increased from 280,000 in 2009 to 450,000 today, and that figure is rising. I also congratulate them on the emphasis that they have put on the STEM subjects at universities. It is highly important to encourage our universities to do the research and to link closely with businesses.
Finally, I thank the noble Lord, Lord Haskel, for introducing this debate. However, he is rather unfair to expect the coalition Government to have turned around the super-tanker of the economy, which in recent decades has been heading fast in the wrong direction. It will take years to turn around that super-tanker.
Lord Northbrook
My Lords, we are all grateful to the noble Lord, Lord Haskel, for introducing this important debate on the development and retention of manufacturing industry in the United Kingdom. Placing UK manufacturing in a global context, whether we like it or not, we cannot compete in the mass manufacturing market because of our wage structure compared to countries in Asia and Latin America, for instance, where labour costs are so much lower. The UK is competing with numerous locations for investment from internationally mobile manufacturing firms. Brazil, Russia, India and China have already moved up the value chain and offer incentives for multinational companies to establish operations in their countries at the risk of eroding our manufacturing base. The emergence of countries such as Colombia, Indonesia, Vietnam, Turkey and South Africa presents an increasingly crowded space in which the UK needs to manoeuvre to attract investment. However, there is no reason why the UK cannot have a niche role in manufacturing higher value added products.
Until very recently, figures for the manufacturing sector throughout the recession have offered signs of optimism in an otherwise bleak landscape. In the first quarter of 2011 the sector grew by more than 20 per cent in terms of output and orders. By September, the sector was still showing year-on-year growth of 2 per cent. We are still the seventh largest manufacturing country in the world and leaders in industries such as aerospace and pharmaceuticals, and we enjoy a comparative advantage in medium to high technology manufacturing. The vital industries that underpin those sectors such as packaging, or the contribution which food and drink, the largest manufacturing sector in the country, make by employing more than 400,000 people, should not be forgotten.
On Tuesday, several noble Lords and I attended a most interesting event sponsored by Dods which, with several large companies and institutes, has issued a publication entitled Manufacturing a Greater Britain. This publication sets out five policy recommendations which I will discuss in more detail. I have also blended in what the main manufacturers’ association, the EEF, has published recently as advice to the Government following the Autumn Statement.
The first recommendation in the document is that we need to improve the rigour of science, engineering, technology and maths teaching in our schools and colleges. This will help drive quality in the UK workforce. The second recommendation is that the Government can play a strategic role in supporting key industries with increased public sector investment in the research and development which will help innovate them. I think this recommendation has to be carefully thought through and targeted, particularly in these difficult economic times.
I welcome the Government’s announcement in October that they would finance a £170 million package to create the first technology and innovation centre in high-value manufacturing. I also welcome, as does the EEF, making additional tax allowances for R&D expenditure available for smaller companies and hope for further progress in the move to above-the-line relief for larger companies. Here I would ask the Minister for progress on these consultations. I can understand that sensible public sector procurement could give preference to UK products, taking into account the extra social security costs if redundancies occur as result of businesses laying off workers or failing altogether as the result of failing to get a contract.
The third recommendation is to review environmental legislation to ensure that energy costs remain competitive. The Chancellor’s announcement of a rebate from the carbon tax for energy-intensive industries is welcome and is also praised by the EEF. It is now necessary, in my view, for a broader cross-departmental review of environmental legislation. As part of this process, each unilaterally applied carbon policy in the UK should account for the likely detrimental effect of an implementation that results in investment being located abroad.
The fourth recommendation is more difficult to achieve in the short term. Manufacturing in this country has suffered a negative perception as being the poor relation compared with having a job in financial services or the professions. One possible silver lining to the recent economic and financial crises may be to persuade new job recruits to go into industry as a more secure place to work. More needs to be done in, for instance, television programming. We need programmes about engineering and manufacturing, especially from channels like the BBC, although I was glad to hear the noble Lord, Lord Haskel, mention a good programme last Sunday. Sadly, overall, its record in this area has been seriously lacking and positively hostile at times, and this needs to change.
Finally, more needs to be done to assist small and medium-sized enterprises, whether through giving them access to finance or export markets. The EEF is also vocal on this front. The UKTI is doing good work to help businesses locate overseas markets. It can do still more to help in this area and make it easier for them to access trade finance.
Lord O'Neill of Clackmannan
My Lords, I am happy to follow the contribution from the noble Lord, Lord Northbrook, and I will pick up on a couple of his themes. I also congratulate my noble friend Lord Haskel on securing today’s debate and for providing us with such a helpful introduction. It was a tour d’horizon of British industry in the round, and it was very useful. It is perhaps significant that this is the second Thursday in a row that we have dealt with industrial matters in the Chamber, and we have seen in excess of 20 contributors applying to speak on each occasion. I want to make a point here.
As a House, I do not think that we deal with this subject in the methodical way we ought to in terms of a Select Committee. I know that we have the Science and Technology Committee, and indeed I have served on it, and that there are a number of economic committees, but we do not have a committee that is devoted to enterprise and innovation, a topic that I believe is the subject of an annual report from the Council of Birmingham University, or certainly from the Midlands. I have already spoken to, as it were, the Labour bit of the usual channels, and when we consider future developments for Select Committees, this topic should be given an opportunity. I say that because, having served on the Science and Technology Committee, it tends at times to be a bit theoretical and has an understandably heavy agenda. The needs of enterprise, engineering and manufacturing could be dealt with more effectively by another such body looking at them.
At this point I should declare an interest in that I am a consultant to the Manufacturing Technologies Association which likes to think of itself, with some justification, as the provider of seedcorn for British engineering. It is the body that by and large provides most of the machine tools required by our engineering and industrial activities. This is done sometimes through imports and sometimes from the UK. The bulk of the association’s membership comprises companies that are relatively small, so the association is not skewed towards the big companies.
Perhaps I may raise a consideration touched on by the noble Lord, Lord Northbrook, the R&D tax credit. I think that there is a slightly different aspect to it. This is working very well for small and medium-sized enterprises because the point of application is also the point when annual accounts are produced. If you are making a profit, then you are able to benefit from the credit. It would be good to widen the scope of the credit to allow bigger enterprises to apply at different points in their profitability cycle, because we know that businesses do not make profits every year, much as that is to be desired. If we had a one-size-fits-all application system, it would probably mean that the credit could not be applied for when annual accounts are being produced, and that could impose a burden on some smaller companies. I make the point in the context not only of an additional burden on business, but also because at a time when we are talking about red tape challenges, this would introduce a bit of red tape that we could usefully avoid. I do not want to scupper what is a worthwhile attempt—in the past we have all argued for R&D tax credits and the like—but it would be unfortunate if a unified system made it more difficult for many of those who are benefiting from it quite considerably at the present time. That was the first point I wanted to make.
Secondly, I want to echo the sentiments which have been expressed in relation to the design and technology campaign. It seeks to try to sustain the design and technology component within the compulsory part of the 11 to 14 curriculum in schools. We talk in a pious way about encouraging young people to get into engineering. If you catch young people of 11 to 14 years of age and interest them in this subject, they will carry on with it. Indeed, one of the important successes of the new-style design and technology curriculum is that it is now one of the most popular non-compulsory subjects at GCSE level. Some caution should therefore be shown, particularly by advocates of the classics against everything else, because not everyone is going to spend their life in contemplative study, and at the moment far too few young people are moving towards productive activity in our manufacturing economy.
I do not wish to appear harping, carping or unduly critical, but we must be cautious about making changes to the tax credit system, worthwhile though they may be. We should also think twice about the possibility of removing the compulsory element of D&T from the school curriculum. It is designed to encourage youngsters to go into engineering, which so many of us consider to be a career and a profession that the country requires and which in itself is intensely satisfying for those involved.
Lord Giddens
My Lords, I, too, congratulate my noble friend Lord Haskel on initiating this debate in his usual polished and persuasive way. I spent most of my career in academic life, but I am an entrepreneur. I started a company; unfortunately, it did not make nearly as much money as those started by my noble friend Lord Sugar.
I shall talk about something which I think is interestingly counterintuitive in terms of what has been said so far in this debate. I want to comment briefly on the re-shoring debate in the United States. Re-shoring is the opposite of off-shoring. It is the drawing-back of manufacturing jobs into the US economy. So far as I know, it has been barely discussed in this country, but it has had very wide public discussion in the United States—in my view, quite rightly—and there is a lot of ongoing academic work about it there on which we could draw in the UK and in Europe. A good example is the work being done by the Boston Consulting Group, which produces a volume called, Made in America, Again. Several reasons are given as to why we might see an interesting reversal in the main trends that have dominated global manufacturing for the past 30 or so years, which I shall discuss briefly.
The first is the instability of global supply chains, something which companies and Governments are much more conscious of in the wake of a series of natural disasters around the world, including the earthquake and tsunami in Japan which severely disrupted supply chains—of course, the explosion at Fukushima plant played a part in that.
The second is the rising price of oil. It seems to me that unless there is a really serious global depression, which one could not write off, the price of oil will continue to rise. It is inevitable because of the technology needed to secure oil from the very difficult places which we now have to get it from.
The third—and this figures importantly in the American debate—is the increasing level of wages in China, especially in the manufacturing centres near to the coast from which most of the goods transported to other countries come. Those wages are rising—of course, the average wage in China is very different—whereas, at the same time in the United States, American real wages have been stagnant or declining. This has been by and large true of the other western industrial economies. When higher US productivity and lower cost of transportation are taken into account, the Boston Consulting Group argues that the cost advantage of making some core types of goods outside the United States becomes entirely marginal and that manufacturers who are thinking three or four years ahead should start to plan in a different way.
Moreover, there is a renewed debate in the United States about the true value of manufacture in an economy, which cannot be measured purely in immediate economic terms. You have to measure it in terms of the skills you lose, the difficulty of replacing those skills, the investment capacities that you lose and so forth. It is very important that we get this into our debate here.
The Boston Consulting Group has done detailed research on seven industrial sectors where it says that production could return to the US. It has also done research in detail on one firm, Otis, which has relocated back to the United States, to find out the reasons. That is appropriate, because Mr Otis invented the counterweight in the elevator in the 19th century. He made possible skyscrapers and thereby, you could say, the American way of life.
The re-shoring thesis has been widely criticised, but I think that the critics are short-sighted about it. You might react sceptically and think, “Oh, well, it’s wish-fulfilment”. But this is wrong, partly because, as a social scientist, I have always found a useful operating principle to be: if you want to think ahead, do not think of current trends but think of the opposite of those trends. That is because history marches dialectically and it could very well be happening here.
Critics say that if production moves from China it will simply go to poorer countries, but I do not think, in the light of all the work that has been done on re-shoring in the US, that this is the case. The reasons, briefly put, are: the shipping time; the shipping cost; cost and quantity control, which you lose when you export your production abroad; and, crucially, lost of patents. Intellectual property rights are so important in modern industry. If you locate your production in a country which does not respect those rights, you do not have the same control as you do in your own country.
In conclusion, according to the Boston Consulting Group, the value of manufacture which could come back to the US amounts to $1 trillion a year. I ask the Minister to comment on this and its relevance to our own debate about manufacturing.
Lord Selsdon
My Lords, I have the great pleasure of serving on the Information Committee with the noble Lord, Lord Haskel, who has always continued to demonstrate to me the theory that people such as me all reach the level of our incompetence but never he.
I always wanted to be in manufacturing. It went probably from my academic education, which was pretty weak. I would learn:
“Abstract nouns in –io call
Feminina one and all;
Masculine will only be
Things that you can touch or see”.
I wanted to be involved in making new things. When I first went into industry, I joined a company called Universal Asbestos, which was not the sort of company to join but it was going into plastics, and I was a young chap who might learn about polytetrafluorethylene, polyvinyl-formaldehyde—all of the “polys”—and how polymers were put together.
I became a rep for a while during my training period in the north-east of England, which was a pretty depressing area at that time. Nobody was interested in new products; they were interested only in getting the old products without having to pay for them in advance. In my plastics world, I was asked, because we were looking for new products, whether I would join a company that was doing industrial and economic research into consumer durables and things of this sort. This ultimately led me into the white goods market with an Italian group called Merloni.
We were looking to co-operate in England. I wrote to the noble Lord, Lord Sugar, as you would expect, because he was a very dynamic chap in those days, offering to help. He wrote a letter which I suppose would say, more or less, “Sugar off”. I am, however, grateful to him today because, last night, Sky Television rang up and asked whether I could be interviewed on manufacturing. Then, to my great relief, they told me at nine o’clock this morning that they had got the noble Lord, Lord Sugar—they had captured a good ‘un.
Manufacturing is quite an interesting subject, but I am not sure that the term is right, because we are looking to where we create added value. I start, because of my background in trade, by reminding ourselves that we have a balance of payments deficit on visibles of £100 billion. We may have a surplus on invisibles of £50 billion, but we have a major problem on deficit with trade, which is effectively the lifeblood of the nation.
Over time, we have failed to recognise the need not only to invest more in new product research but to find that particular moment when you get from the product design—that can be years away sometimes—to it being take up. When I was in the banking world for many years, I would be approached on odd things that other people would not finance. If someone rang up, my colleagues would say, “Oh, it’s another hare-brained scheme. Go and talk to Malcolm”. That would be hovercraft or things that never seemed to get off the ground. Let us take the hovercraft industry: it was a great technology which then steadily faded away. It became no good for transport, but it was good for things like surveillance out in the Arctic or over the tundra.
Surprisingly enough, it was in the white goods field that I became quite interested. We wanted to co-operate. We could not get any co-operation from Arnold Weinstock so we bought Hotpoint. Hotpoint was originally the hot point of the iron that gave you the greatest heat which meant that it was perfect. The next company that we went and bought was called Colston. Charles Colston played squash. He found that the rubber of a squash ball got so jolly hot that a special type of rubber was needed. He then worked out that if you put a rubber seal around a washing machine, which could heat the water hotter, you would have a better machine. The Colston was used by the middle classes for ever and a day. My mother kept one for 50 years.
In all of these areas, we then found that you looked for the greatest component part or cost of something. Usually, it was the bit that always went wrong such as when button pressing came in, and when buttons disappeared, you found that the wrong electronic signals were sent so you could not make the thing work.
When one looks at the world of consumer durables, what helps everybody, ultimately, is if you can get a conditional order. Having gone into the water industry—I followed the pipe connection right the way through—I ended up working in water and sewerage and doing big sewerage projects. My favourite project was one in India where we were going to use the latest technology. In the end, our pumping station used the Archimedes screw. Archimedes had used his screw to get water out of a ship in Alexandria harbour. Then I found that my heroes were not the modern engineers; they were Archimedes, Galileo, Newton and even Einstein; who all operated on the same level as the noble Lord, Lord Haskel, which is many levels above myself.
Yet in some areas we have made big advances. The noble Lord, Lord Bilimoria, who I respect greatly, mentioned 20:20 vision. He must not worry. Some of the most advanced people in the country are in the field of retinopathy. If he has any problems with 20:20 vision, please will he come and see me?
Lord Morris of Handsworth
My Lords, it is a privilege to add my name to all those thanking the noble Lord, Lord Haskel, for securing this timely and important debate.
As we see the balance of our economy weighted in favour of what we import against what we produce, there is no doubt that we need to rebalance our manufacturing priorities in favour of home production and exports. The reality is that we urgently need a new strategy for British manufacturing, in the absence of which we will end up taking in each other's washing and, sadly, we will have to do it using our Japanese washing machines.
It is my hope that in this debate we will not just concentrate on what has gone wrong, but we will seek to focus on some of the solutions, as the noble Lord, Lord Haskel, did in his introduction. But first let us talk about the problem. The scale to which the British manufacturing sector has shrunk in the past 30 years was highlighted in a recent Guardian article under the headline “Why doesn’t Britain make things any more?”. I do not quite subscribe to that. We do make things. The issue is that we need to make more things and make better things, and most of them should be things to serve other markets. The article asserts that in the past 30 years the UK manufacturing sector has shrunk by two-thirds—a factor described as the greatest deindustrialisation of any major nation, all done in the name of economic modernisation. Let us be clear. The impact of deindustrialisation on our manufacturing sector has swept through our country with the force of a hurricane.
Much has been written about it and our experience has been enhanced by the Industrial Revolution, but today it is the deindustrial revolution that carries the heavy social and economic burden. But what is the driving factor behind the flight from manufacturing? In the 1980s, we were told that in the future we would hire brains, not labour, and that the role of Governments was to get out of the way and let a thousand creative flowers bloom in the knowledge economy. Silicon Valley was the inspiration and Britain would become the e-commerce capital of the world. Sadly, the so-called economic modernisation has led to a large degree of industrial decay.
When the noble Baroness, Lady Thatcher, came to office as Prime Minister in May 1979, manufacturing accounted for almost 30 per cent of our national income and employed 6.8 million people. But when the previous Prime Minister left office in May 2010 it was down to just over 11 per cent of the economy and employed just 2.5 million people. While Britain's manufacturing household brand names disappeared, what a contrast it is that Germany and France have managed to retain their household names such as Renault, BMW, Bosch and many more.
The impact of deindustrialisation on the balance of our trade means that, last year, Britain actually bought £97 billion more in goods from abroad than we sold—the biggest shortfall since 1980. In the north-east, manufacturing jobs have nearly halved since 1979. Deindustrialisation attacks the base of our manufacturing sector and, by extension, the strength of our economy. For example, the majority of the 6,000 workers who lost their jobs when MG Rover closed in 2005 have by now found alternative employment. But a recent study shows they are on average earning nearly £6,000 less per annum. That is an economic negative to the UK economy. The danger is that a greater proportion of our citizens now earn their living from the state as an employer. That is no wonder when we give train contracts to German factories rather than to workers in Derby.
I pause here to assure the noble Lord, Lord Lee, that the contribution to British manufacturing is not exclusive to the boardroom. The Mini motor car would never have been built but for the designers at Hardy Spicer who designed the first constant velocity joint, enabling the Mini to be driven off the front wheels. I know because I was there for 18 years, but I visited the boardroom only when I had bad news.
I went to a reception recently to celebrate the rise and progress of Triumph Motorcycles in Leicester. As I stood there I thought, “If I get arrested on the way back to this House, the motorcycle that the police officer will be riding will be a BMW, and possibly also the car his colleagues are driving as well”.
Baroness Rawlings
My Lords, this is a timed debate and we are running out of time. Please will the noble Lord wind up his remarks?
Lord Morris of Handsworth
I will merely say that we must align our procurement policy with our manufacturing policy because manufacturing really does matter.
Lord Soley
I add my congratulations to my noble friend Lord Haskel. He is one of the few Members of this House who actually puts entries on the Lords of the Blog site about manufacturing. Some noble Lords who have been speaking today should do the same because entries always attract a lot of interest. I am delighted that my noble friend Lord Sugar is going to do one of the television broadcasts that has been organised by the press office of this House, because we need to get the message out about the importance of these debates. They are important in their own right but we should not just be talking to ourselves or to government Ministers, as important as that is. Getting the message out to a much wider base is important as well.
I want to focus on one factor, which is the immense importance of science and technology to the manufacturing process in the modern world economy. In his introduction, my noble friend Lord Haskel reminded us of something that we should keep reminding ourselves about. It is difficult to separate manufacturing from servicing. There is no artificial divide.
An example from my old constituency of Hammersmith is similar to the one given by the noble Lord, Lord Sugar, about what happened with small knife and fork manufacturing industry. When I was first elected there in the 1970s, you could go to the arches under the Shepherd’s Bush railway line, or down to Acton, and peep through the closed doors and find people all manufacturing heaven knows what. When the BBC expanded big time in Shepherd’s Bush, that began to go, and instead there was a growth in design, particularly electronic organisation and manipulation of information. Although we might all complain about the BBC television licence fee, in fact the BBC produces—it manufactures—films that are sold all over the world. We often talk about the impact that gives us in terms of culture, political influence and so on, but actually it is a manufacturing process. People are buying that product.
Somebody has already referred to the good example of the television programme about a week ago on the Rolls-Royce engine. There was an equally good one—the same series—on how we make space satellites. People forget that there are very few satellites orbiting this earth that do not have British products in them. There is a message to be made. There is this overlap.
I would like the Government to bear in mind, in their policies on this, the work done on science and technology that was built up very dramatically by the last Government. I hope and anticipate that this will be continued by the present Government, because we cannot have the advances we are looking for without it. The noble Lord, Lord Cope, seems to feel that the decline in nuclear energy was down to the last Government, but it was not. It was much more serious—an acute concern developed in the 1970s and 1980s about climate change and, very sadly, the green movement got carried away with what I regarded as an anti-science approach. All parties, including those overseas, became infected with the idea that climate change could only be combated by, in effect, a “back to nature” approach. The answer to climate change, which I regard as very serious—I wrote my first article on it back in the 1980s—is not “back to nature” but “forward to science and technology”. That is what will crack it at the end of the day; that is what enables us to deal with it.
Nanotechnology is of immense importance. This is something that this country is doing an awful lot on but an awful lot of people will not know what it is. It is the manipulation of matter at a sub-atomic level, and enables us to develop new products which are self-generated by the nanotechnology that underpins it. We are very good at that in biology, chemistry and so on. We have a lead on that very largely because of the National Health Service, which provides an enormous market for drugs and many other matters related to the advanced technologies. It is time we not only used that in our exports around the world—which we do—but recognised that many people look to the health service; which, for reasons that escape me, we keep reorganising, with some bizarre idea that yet another reorganisation will somehow answer these problems. Many people overseas look to not only the science—the biology and chemistry—underpinning what the National Health Services does for us but to its organisation. We could actually sell that service overseas.
Lastly, I want to mention aerospace. Again, I say to the noble Lord, Lord Cope, that if he wants to avoid the problems that affected nuclear energy, watch out for the Government’s blindness on our hub airport policy. If you want the second largest, most advanced, aerospace industry, you have to have a system of supply underpinning it. If we just carry on with the assumption that we do not need to worry about the underpinning work that is done by having hub airports and so on, it will see the same fate as the rail industry. We invented railways and the Industrial Revolution, but let it slide by not keeping up with the science and technology. Science and technology will drive things forward. That is the message of the Industrial Revolution and we ought to bear it in mind when we are talking about manufacturing and science.
Lord Young of Norwood Green
My Lords, I, too, congratulate my noble friend Lord Haskel on what I can only describe as a panoramic contribution on a vitally important issue. He reminded us about the scope of manufacturing and how it links with services and the importance of design. I, too, watched with breathless admiration that recent programme on the making of a jet engine, which was a stunning advertisement for British engineering at its finest. We also had an interesting foretaster debate on cycling earlier, and just down the road from where I live is the Brompton Bicycle factory—another outstanding British success story—which exports all over the world. It produces a high-quality product, which I use every day.
I have thrown most of my intended contribution away because there have been so many fascinating contributions from around the Floor of the House, but an area that has not been covered is the importance of creating hubs—Formula 1 is a good example of this—where a number of manufacturers gather together. I cite that only because it seems to me that it has not been mentioned today, although the noble Baroness, Lady Randerson, made a point about the importance of supply chains. I would welcome comment from the Minister on what steps the Government are taking to encourage the creation of hubs. There is another example in the east of London, in the Old Street area, where we have another potential silicon valley. Hubs require good infrastructure, and these days high-speed broadband is perhaps at the heart of infrastructure. The Government are doing something in that area, but not, I believe, enough.
It will not surprise the noble Baroness that I want to focus on the question of skills. I was very interested in the contribution of the noble Lord, Lord Jenkin, when he talked about the lack of skills. There are some problems in this area and I would not want to deny that, but there is a sort of puzzle as well. For example, British Telecom advertises for 300 apprenticeships and gets 25,000 applications, so I do not think that it has much trouble in filling those.
Clearly, education is a key point, and it is profoundly important to ensure that we create enthusiasm in schools and colleges for design and technology. This raises a question mark about this Government’s concentration on the EBacc, the English baccalaureate, which seems to focus on the classics. There is a real danger, if we are not careful, not that we will be pointing schools and colleges in the wrong direction, but that it will not be inclusive enough. We know it is important to encourage people early on to have an enthusiasm for the importance of manufacturing and the excitement of design. I think the noble Lord, Lord Jenkin, talked about schools and companies and the interrelationships between them. He is absolutely right. Every school in this country should have a relationship with the local business community, and it does not particularly matter which way round it happens.
Career advice is another really important area. Unfortunately, as someone who was a member of the last Government, I cannot ignore the fact that we focused so much on the question of getting 50 per cent into university, which seemed to create the view that a vocational choice was a second-class choice—it certainly is not.
Obviously, I cannot resist the question of apprenticeships, because that is part of the skills equation. I was reading the briefing pack on this debate supplied by the House of Lords Library—again, a really good document—which talks about the barriers to innovation, growth and internationalisation. There is a paragraph in there that I would welcome the Minister giving some thought to. It says:
“For example, firms may under-invest in important skills if they are unable to fully appropriate the benefits of their investment in training because some of the benefits spill over to other firms. The dynamic nature of modern manufacturing may also make it difficult for employers as well as employees to accurately predict the skills sets that could be required in the future”.
That is a bit of a coded paragraph. I had an example of this when speaking recently to one of the sector skills councils. What it is actually saying is that when Nissan, for example, trained its apprentices, it was only to find that at the end of that training period they were poached by another firm offering them a higher wage. Well, other firms would do—they did not have to pay for the training. It is a serious point.
Although I appreciate the importance that this Government give to apprenticeships, we still have to crack the problem that only somewhere between 4 per cent and 8 per cent of British firms have apprentices and only one-third of FTSE 100 companies have them. I have said time and again to the coalition Government that they really need to get companies to lead by example. One way in which to do that is with procurement contracts. The Government keep shying away from that, and I do not understand why because it will not cost them anything and it is not illegal. We managed to do it, and I invite the Government once again to consider that. The Government need to create a climate where it is the norm for all companies to have apprenticeships. They ought to encourage the bigger companies to ensure that their supply chains take on apprentices. We did that with Rolls-Royce, Jaguar and Land Rover. They should encourage the use of group training associations. I have rehearsed these arguments on a number of occasions before, but they are a key part of this question of getting the right skills as part of the manufacturing equation.
So many good points have been made that I have very little time to cover them. My noble friend Lord Bhattacharyya talked about the importance of procurement decisions. We have heard references to Bombardier, the defence sector and the importance of new British products—as my noble friend said, not just the life sciences but all the applied sciences.
As my noble friend Lord Haskell said, there is also the importance of encouraging not just short-term investment but longer-term investment. We heard of a number of examples of family-owned firms that seem to understand the importance of that. The noble Lord, Lord Lee, made reference to that.
My noble friend Lord Sugar talked about high-quality manufacturing. I reflected on that and thought of one example of a British success story that might not have come automatically to mind, although it would to the Minister—that is, Mulberry handbags. They are British made, a British product and a British design, and I am sure that she can manage one on her ministerial salary. It is an important example of a British high-quality success story, and the importance of things being made in Britain that my noble friend addressed.
Another area to which the noble Lord, Lord Dykes, referred was the importance of food and drink manufacturing. That is a huge area. Then there is farming. Agriculture itself is another important area, and we should do anything that we can to encourage not only production but the processing of the products that farmers produce.
My noble friend Lady Donaghy made a particularly insightful contribution and again talked about the importance of having hero engineers. I absolutely agree with her, and I think that the QE prize is an interesting and important development.
I sum up what the Minister may have to say in her difficult task of responding to this debate. First, there is what the Government are going to do in encouraging the creation of more hubs. Secondly, there is the question of apprenticeships and procurement.
Once again, I thank my noble friend Lord Haskel, for creating this opportunity.
The Parliamentary Under-Secretary of State, Department for Business, Innovation and Skills (Baroness Wilcox)
My Lords, I thank the noble Lord, Lord Haskel, for securing this debate on a very important subject and I pay tribute to the work that he has done as an advocate for the textiles industry. I reflect, too, that he was a Trade and Industry Minister in the previous Government, so he knows where all the bodies are buried. He also knows how difficult it is for me to stand up here and be able to respond to this debate as positively as I can in these difficult times. I reflect on what the noble Baroness, Lady Randerson, pointed out. We are trying to turn this super-tanker around into the right direction, and it all takes time—more time than we would really like.
The noble Lord, Lord Young, always speaks at the end and I very rarely get a chance to answer his questions, so I thought for once that I would just say that it is always a pleasure to listen to him because he really knows this subject and knows particularly about apprenticeships. I will answer on apprenticeships and procurement a little later, when I answer the noble Lord, Lord Bhattacharyya, if the noble Lord will accept that. I may not get to the noble Lord, Lord O’Neill, to say thank you for finding candidates for the “red tape challenge”. I was interested to hear his comments on the Select Committees. The usual channels would do all that, but it is good to hear it. As for the noble Lord, Lord Giddens, and reshoring, I have an answer for him later. We are not likely to do this, but I am interested to hear it.
As we know, the UK is recovering from the biggest financial crisis for generations and faces an intensifying sovereign debt crisis in the euro area. That has further damaged global confidence, which does not help us. In the Budget in 2010, we set out the Government’s plan to reduce the deficit and rebuild the economy. The actions taken have, at least so far, helped to restore stability and consolidated the UK’s AAA credit rating, which is a very precious thing to have and keeps this country attractive to investors. In common with other industrialised countries, the share of manufacturing in the United Kingdom has fallen. There are structural factors which have led to this decline, such as technological change, a shift in demand for services, and tough competition from low-wage countries, especially in high volume, labour intensive products. The Government cannot control these forces, but we can help to ensure that the UK is in the best possible shape to compete in global manufacturing markets by upskilling and encouraging new investment.
Contrary to popular belief, the UK is still one of the world’s biggest manufacturers. We actually make more from manufacturing than we do from financial services, which some people might find quite comforting at this stage. Manufacturing contributes disproportionately to overall levels of productivity as well as generating over half the UK’s exports of goods and is responsible for much of the business R&D in this country. I welcome the contributions from my noble friend Lord Northbrook and the noble Lord, Lord O’Neill, on the R&D tax credit.
British companies, both large and small, are building global reputations in sectors such as pharmaceuticals, the automotive industries, chemicals, aerospace, off-shore oil and gas supply industries, among others. There are big new industrial investments taking place, even in these difficult times. Two weeks ago Toyota announced a £100 million investment at its factory near Derby. At the same time Airbus has announced 200 extra engineering jobs at Feltham, and Nestlé has announced a £110 million investment at its Tutbury plant, with 300 extra jobs. It all goes to help. We recognise that the external economic position is very difficult but we are determined to promote recovery and rebalancing.
I will try to answer as many questions as I can as I go through, so that noble Lords do not all have to wait for the letter to come. In the Plan for Growth published alongside the Budget in March, we set out a range of actions to support the manufacturing sector, including measures to improve technology commercialisation, boost access to a skilled workforce and promote the image of the sector. The noble Lord, Lord Haskel, spoke of a coherent strategy for manufacturing, and this strategy has been developed through consultation with industry. We are working with the sector to implement the actions set out in that strategy.
In answer to the questions from the noble Lord, Lord Bhattacharyya, on procurement, we recognise that there is a need to manage the procurement and investment processes in the public sector so that we can sustain a competitive supply base. The next phase of the growth review has been looking at how the Government can support businesses and ensure that when they compete for work, they are doing it on an equal footing with their competitors. My right honourable friend in another place, the Minister for the Cabinet Office, announced a series of measures at the strategic suppliers’ summit on 21 November, including a more strategic approach to the way we buy public goods, works and services. Building on the good progress in implementing these actions, further measures, as I have said, were announced in the Autumn Statement last week. The £40 billion credit-easing scheme will underwrite bank loans to small businesses. Alongside our £20 billion guarantee scheme to lower the cost of loans, this should help those SMEs struggling to get finance on reasonable terms.
Although I am sorry that the noble Lord, Lord Bilimoria, feels that we have not moved at all since last year, I might say that I was thrilled to hear poetry quoted in this place. Usually, when I go to the European Union I sit there and listen to everybody else quoting poetry, thinking, “This never, ever happens here”, but today it did, so there we are and I thank him for that. In answer to the noble Lords, Lord Bhattacharyya and Lord Bilimoria, regarding access to finance and banking, under the Project Merlin agreement Barclays, Royal Bank of Scotland, Lloyds, HSBC and Santander have promised to lend £190 billion to businesses in 2011, including £76 billion for SMEs. During the first nine months of 2011, the Merlin banks have achieved total gross new lending of £157.66 billion, including £56 billion to SMEs. They expect to deliver their 2011 commitments, and we will of course keep a close watch on lending in the fourth quarter to ensure that the banks really meet those targets.
There will be a £1 billion increase in the regional growth fund to help regional rebalancing. We are also investing £5 billion in new transport and broadband infrastructure, streamlining public procurement, developing a new approach to supporting local supply chains, and introducing measures worth around £250 million to help our energy intensive industries to reduce their energy bills. I can reassure my noble friend Lord Northbrook that we carefully consider all environmental and energy regulations from the European Union. Our energy intensive industry package, announced in the Autumn Statement, is evidence of this and I encourage him to read it.
Only this week, the Secretary of State announced the advanced manufacturing supply chain initiative. Up to £125 million will be used to improve the global competitiveness of the UK’s advanced manufacturing supply chains by supporting innovative projects where the UK is well placed to take a global lead. The fund will be run on a competitive basis by the Technology Strategy Board. Expressions of interest will be invited this month and formal applications in the new year. It will be flexible in the type of support offered to successful proposals. We welcome the proposal from the noble Lord, Lord Sugar, for incubator units. The £1 billion increase in the regional growth fund offers potential opportunities for that type of support. To plug the gap between pure research and commercialisation, we are investing £200 million in a network of elite technology and innovation centres, to be known as TICs. The high-value manufacturing TIC will receive more than £140 million over a six-year period and is now open for business. We are also capitalising the green investment bank with £3 billion from next year.
The noble Lord, Lord Haskel, asked about design. Support for innovation and technology commercialisation is a crucial part of our strategy to support UK manufacturing, and design is an integral part of commercialisation, making products desirable for end users by improving performance and recyclability at the end of the product’s life. Design impacts on the product’s whole life cycle and is crucial. We are looking at more and more ways of being able to work with design.
My noble friends Lord Selsdon and Lord Northbrook are right that the United Kingdom needs to up its game on exporting, including manufacturing. Currently, only one in five companies exports; we will try very hard to increase this to one in four. That is why we have launched the national export challenge, a series of initiatives to help SMEs to take the first steps to break into new markets.
In response to my noble friend Lord Cope on intellectual property, today we are hosting the first UK-China intellectual property symposium in London. Furthermore, we have appointed our very first IP attaché to the UK embassy in Beijing, who will take up that post next week. This is the start of a new high-level dialogue with China on IP working with relevant agencies. My noble friend also touched on the European Union patent, of which we have been a strong advocate. After forty-one and a half years it looks as though, with our lead, we will actually get a single patent for the European Community. Our worry there is the way that the court is formed to deal with that single patent across the whole of the community. I have just come back from Brussels, where we have been discussing that excitedly.
We have put apprenticeships at the heart of our strategy to ensure manufacturing businesses benefit from a more highly skilled workforce. My noble friend Lord Jenkin of Roding spoke encouragingly of the work of John Hayes on skills and the employer-led skills council; for that, we are very grateful. He also talked about the talent retention scheme in which Mark Prisk is involved. I will pass those comments back to them, as any encouragement is welcome.
We have seen a record year in terms of numbers of people both starting and completing their apprenticeships. The noble Lord, Lord Haskel, mentioned the quality of apprenticeships. The £75 million package announced in March is for advanced-level and higher apprenticeships and includes a £25 million fund to support 10,000 advanced and higher apprenticeship schemes. Last week we announced the £18.7 million from the higher apprenticeship fund, which will support the development of 19,000 new higher apprenticeships in a range of sectors, including advanced engineering. At an apprenticeship summit last month, we announced measures including an incentive to encourage small firms to take on their first apprentice. The Government will offer employers with up to 50 employees a payment of £1,500 to take on up to 20,000 apprentices aged 16 to 24. That does not actually read right; I do not think it means that people who employ 50 employees will be allowed to take on 20,000 apprentices, so perhaps I read that wrong.
I agree with my noble friend Lord Lee that it is vital for the future that our young people need to have careers in manufacturing made more attractive to them. The noble Baroness, Lady Donaghy, and my noble friend both spoke about heroes. I would like to take that idea away, if I may, to Mark Prisk because I think he would like to work on that. The Government are working with industry to highlight to young people exciting careers in manufacturing through the See Inside Manufacturing programme. More than 35 companies and organisations from the automotive sector were involved in the pilot phase in June and October, involving open days for teachers, careers advisers, and young people. We plan to roll out a SIM in another manufacturing sector next year.
The noble Lord, Lord Haskel, might like to know that we at BIS have been holding regular displays in our foyer to showcase British design. I wanted to mention that because it has been very exciting. The building is very boring, and it is lovely to have filled up that great big glass space with something that looks interesting. This may be a small thing, but we have also taken people who work in the reception area out from behind reception and got them standing and walking around in the reception area to talk to people who are a bit bewildered about where they are and do not quite know where they are going, and to interest them in the displays. That seems to have gone down quite well, so I am pleased with that.
In my own role with oversight of intellectual property, I am engaging with the design sector and well understand its contribution to the UK economy. The “Make it in Great Britain” campaign, launched on 5 November, is another strand of our action to raise the profile of manufacturing, so the noble Lord, Lord Sugar, is right to encourage us to promote “Made in Great Britain”. As part of the campaign, BIS will work with United Kingdom industry to stage a high-profile interactive exhibition of cutting-edge UK manufacturing at the Science Museum next summer to coincide with the London Olympic and Paralympic Games.
We are working hard to encourage and support British manufacturers and to create an environment where they are free to thrive and compete in a global marketplace. Government action is already resulting in new industrial investment as a direct result of our commitment to introduce the patent box. GSK has stated that it will invest in the UK, including a proposed biopharmaceutical manufacturing plant costing £350 million to £500 million and creating 400 to 500 new jobs. I look forward to attending a second manufacturing summit in February next year in Bristol to give the Government and industry another opportunity to discuss what has been achieved and what more can be done.
I am confident that we can once again put world-class manufacturing at the heart of our economy. The process always seems too slow. To have to stand here and face the noble Lord, Lord Bilimoria, saying that we have done very little since the last time we had this debate is a bit discouraging for me. I hope that, now that he has listened to some of the answers that I have given, the next time we have a debate on industry and have representation from all sides of the House, for which I have been extremely grateful today, he might be able to get up and say, “Doing better”.
Lord Haskel
My Lords, I thank all noble Lords and the Minister for their ideas, their thoughtful insights, their suggestions and their plain warm feelings towards manufacturing. That is a big contrast. When I first came into this House many years ago, manufacturing was looked on as a bit of a nuisance, something that had to be got out of the way. At least today it is looked upon as something that needs active encouragement and support. We have entered a race that we have to win, not a race to the bottom but a race to the top. A lot of the ideas we have heard today will help us get there.
We have heard some wonderful ideas about skills, apprenticeships, procurement and the importance of patient money. We have not had a lot of discussion about the way that our businesses should be run. Patient money and stewardship are a very important part of a successful manufacturing business.
We have spoken about putting manufacturing on a pedestal and making it a priority. That is absolutely right. We have been told about the single European patent, the suggestion about “Shop British” and the attitude to work. We have been told that we have a strength in our NHS records and life sciences. I like the idea of manufacturing heroes and a Minister for Manufacturing. Perhaps we ought to know more about what Mark Prisk is meant to be doing about that. We heard about reshoring in the USA, an idea that is beginning to take hold. We heard about the added value from manufacturing and how it will help with the balance of payments. We heard about the importance of getting the message out and about the importance of science and of hubs and clusters. We have even had a mention of farming.
The Minister told us all about the Government’s financial schemes. I hope that they are working; some are but some are obviously not. We have to get our firms to export. I was glad to hear that the department has become more visitor-friendly. I congratulate the Minister on that.
Once again, I thank all noble Lords who have spoken. Our debate has covered a lot of points. I hope that it will encourage and prioritise help for manufacturing. I beg to move.
Health: Neurological Conditions
(13 years ago)
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Lord Dubs
My Lords, I welcome this opportunity to initiate a debate on neurological conditions. I declare an interest at the outset because a member of my family has had MS for about 10 or 12 years, so I have some fairly close and direct experience of what the condition means.
To start with, I shall say a little about disability in general, although it will be about elements of disability that affect people with neurological conditions, and then I shall talk about neurological conditions themselves. Disability affects many people with neurological conditions. One of the main things that people discover is how costly it is to have a disability. There are all sorts of routines in life that most of us carry out very easily but that simply cost more for a person who is handicapped and cannot get about so easily. I am concerned that the Government’s welfare reform agenda properly supports all people with MS to live a full independent life, particularly with the move from disability living allowance to the personal independence payment, but I am not trying to repeat the substance of legislation that is currently going through.
People with disabilities, particularly those in wheelchairs, will often realise that being disabled is very costly. Aids and adaptations can be expensive, and some of the firms supplying them adopt pretty aggressive selling practices even though some of the people they are dealing with are vulnerable. I shall give your Lordships an example. I was talking to a person with MS who said that she wanted an adaptation for her home—I think it was a hoist of sorts. The company came to her home and wanted £2,000. She said that she could not possibly afford that. They phoned repeatedly, and gradually the price went down to £600. There is something very curious when a person with a disability can be hassled in this way over an essential adaptation, when clearly the mark-up must have been enormous if the firm was willing to sell at the lower price.
We see many areas of life where high technology comes in, yet in the disability world modern technological materials are pretty expensive. A lightweight wheelchair of the sort that one pushes is usually so frail that one cannot push it very far, whereas more robust wheelchairs are heavy and hard for people to lift into a car boot. I wish that the technological world would just get stuck into this area; a lot of people would benefit.
I turn to some specific neurological conditions. Every person is different and there is no set pattern for people with these conditions. The conditions are usually progressive, so the patients’ needs must be met in differing ways. What neurological conditions have in common is that they are—I hate this word; I am looking for a better one—unfashionable. They do not have a high enough profile compared with other conditions like breast cancer or HIV/AIDS. I congratulate the organisations backing those; they have had high-profile success. Because people with MS and other neurological conditions have a low profile, though, public awareness is not really there. That means that the conditions inevitably attract less attention from decision-makers and command fewer resources.
I shall give an example from local government. Many people with neurological conditions, and other disabled people, have difficulty gaining access to public buildings. I know that conversions of old buildings can be costly, but in the mean time this can affect people’s basic rights. I appreciate that this is mostly a local authority matter, but I thought that I would just flag it up in passing.
On a national scale, there is currently no national strategy for neurology. This means that there is no proper leadership from the top. That has resulted in some of the very effective neurological charities struggling to make their voices heard in order to get a good service for people with such conditions, regardless of where they live. We have, or had, a National Service Framework for Long-term Conditions. However, when this was introduced the implementation and monitoring were rather poor, which resulted in a lack of understanding of what its real effect has been. The framework was introduced in 2005 but many concerns remain, such as variation in service provision, poor co-ordination of care, poor-quality care and poor information. The framework identified key areas of concern, including diagnosis, access to treatments, information for patients and quality of care and service, and aimed to improve them by 2015. However, I understand that the framework is now no longer the policy of this Government, who intend to have a general long-term conditions strategy. However, frankly, with no leadership, there is real concern that neurology will once again be an unheard voice. There must also be a concern that this will result in a deterioration of care for people with neurological conditions.
I turn briefly to commissioning. I do not want to repeat arguments and debates in which the Minister has taken part on the Health and Social Care Bill, but I want to address commissioning because it affects neurology in a very important way. Certainly, the Minister will have had representations from the Neurological Alliance, as I have had, which represents 40 brain and spinal charities, representing some 8 million people with neurological conditions. The problem concerns how the commissioning of services for people with MS and other neurological conditions will take place under the new CCGs. There is a sense that there is a strategic gap between CCGs and the national Commissioning Board. CCGs, as at present devised, will cover relatively small populations and it will be difficult for them to be cost-effective in commissioning services for less common conditions. I have mentioned that there is a large number of people with neurological illnesses but for each condition there are often, mercifully, not so many sufferers, so the services will involve specialised support for a relatively small number of patients. The national Commissioning Board, which might have an oversight, will be too far removed from the localities. I hope that something can be done to ensure that the CCGs, perhaps working collaboratively with oversight, can make up for the lack of a strategic health authority, which did the job pretty well. I also think that there should be an advisory group within the NHS Commissioning Board on the subject of neurological conditions.
I understand that the National Audit Office is to report shortly on the provision of services for progressive neurological conditions. I will not speculate about what it may contain but it may be very helpful in the scheme of things. When a person is told that they have MS, it is a very traumatic experience for the individual. Often they are simply told to go home and that little can be done. A person with MS—not someone in my family—said:
“I mentioned the lack of support services when people are first diagnosed with MS. This was based solely on my experience where the neurologist told me there was nothing they could do for me but advise me to avoid hot baths and red meat. I was given no leaflets or other information and no support telephone numbers”.
That is pretty serious. The situation may have improved recently but many GPs are not that aware of this condition and it is hard to get information and advice.
The Minister will be aware that one of the key difficulties is the lack of MS nurses or neurological nurses. I wish to quote patients’ comments in this regard. One says:
“My MS Nurse is amazing!! She is great and helps with anything, if it weren't for her I do not know what would be happening to me”.
Another one states:
“My local MS nurse has been an absolute godsend, I could not imagine coping without her”.
That is fine, but many persons with MS do have to cope without an MS nurse. Frankly, if somebody with MS were to move their home and asked my advice, I would advise them not to move until they had checked the availability of MS nurses in the area to which they are going. In other words, they should not go to an area where there is no MS nursing support; it is just too difficult for these people and their life will be much easier if they move somewhere else. That is a real example of a postcode lottery.
I appreciate that some MS nurses are provided by a local authority but I understand that the majority are employed by acute trusts. What will happen under the new commissioning arrangements—assuming that the Bill goes through in its present form—to ensure that the number of MS nurses does not fall under the new scheme of things? I am not sure whether in present financial circumstances it is better to have neurological nurses or more specific MS nurses, plus specific nurses for other neurological conditions. However, the need for some element of specialism is very clear. MS nurses provide support for the whole range of a person’s needs; in fact, they provide a holistic approach to the condition and, of course, they refer individuals to where they can get appropriate further help. Therefore, it is important that there are enough neurologists for patients to be referred to. Some MS nurses have told me that they provide advice to patients but, if there is no neurologist to whom they can refer the patients, that is pretty difficult. Therefore, there is a real need for MS nurses. They do refer patients for physiotherapy. I am told that of all the things to help people with MS, physiotherapy actually does help. I speak from experience in my family. However, existing resources for physiotherapy are limited and many patients with MS do not have access to physiotherapy at all.
There are quite a lot of disease-modifying drugs that manage the symptoms. There have been many discussions about the cost of these, in which NICE has been engaged. However, the majority of MS patients apparently have very little of this sort of treatment. A well known drug is Tysabri, which has been recommended by NICE. It has a positive NICE appraisal. Some other drugs are made available; I think that beta interferon is one of them. I appreciate that they are costly but there needs to be a more systematic approach to the sort of drugs that should be made available for people with MS, and an assessment of their efficacy for the condition. One neurologist is alleged to have said—I did not hear him say this—that 90 per cent of his patients take cannabis. He feels that he cannot criticise that. It may not be therapeutic but, if it makes the patient feel better, one has to be very careful before one gets too critical of that. I suppose that in the long term the main hope is stem cells. Their use to treat this condition is a long way off but I hope that the Government will put maximum effort into encouraging stem cell research because that represents more hope for patients than anything else.
We have a rather disappointing record as regards comparisons with European countries. In a study conducted in 2009 on access to treatments, Britain was ranked 25th out of 27 countries. Another study in 2010 assessed provision for specific conditions, including MS, and the United Kingdom ranked 13th out of 14. International comparisons matter although it is difficult to establish whether they are evenly based.
I wish to mention a couple of other neurological conditions. One is trigeminal neuralgia—I hope that I have pronounced that correctly—5 per cent of people with MS also have TN. It is frequently misdiagnosed. This is understandable as only about 7,000 people are alleged to have the condition. However, it causes incredible pain and even after surgery the pain may return within a few years.
A couple of days ago I was talking to a specialist in epilepsy. He was very concerned that there should be quick and efficient diagnosis of children. If they can be diagnosed quickly when they are young, their lives can be saved or their quality of life can be improved. At present, 1,000 people a year die of epilepsy—40 per cent of these deaths are avoidable—and 59 per cent of childhood deaths are potentially avoidable. Again, improved access to specialist clinicians, nurses and surgery is the key.
I wish to ask the Minister a few more specific questions in my remaining time. How will he ensure that people with long-term neurological conditions will be supported in order to improve their quality of life, including access to treatment and care? There is an urgent need to have someone accountable for neurology services. Does the Minister agree that appointing a national lead for neurology within his department would help to ensure improvements so that we can catch up with our European counterparts? It has recently been made public that the Government will be developing a long-term conditions strategy. Will the Minister elaborate on that and give us some idea when it might be published? Given the experience of the National Service Framework for Long-term Neurological Conditions and the lack of impact that it ultimately had, what will the Minister do to ensure that neurology is not once again ignored and underrepresented? Finally, does the Minister recognise the need for a neurology strategy as a separate entity from the planned long-term conditions strategy?
If this debate raises awareness of the issue and raises the profile of people suffering from these conditions, it will have achieved something. If the Minister can give me a positive answer to these questions, it will have achieved a great deal more.
Baroness Gardner of Parkes
My Lords, I should declare my interest because a member of my family has multiple sclerosis.
My speech is to be a bread and butter one. As I am an Australian speaker, your Lordships will appreciate that my comments will be upside down, the butter first and then the bread. The butter is the special part: the noble Lord, Lord Walton of Detchant, who is such an expert on neurological matters, has authorised me to place on record part of the contribution that he would have made, but regrettably he is not able to take part in this debate.
This is what the noble Lord has asked me to say. This Government should be congratulated on their recent Statement on support for translation research—that is, translating results of basic scientific research into practical patient care. For example, discoveries in molecular biology and genomic medicine are beginning to identify treatment for some rare but serious neurological diseases such as muscular dystrophy. Many other inherited diseases are likely to benefit. There is a problem. The drugs discovered in this research will be very expensive and commercial benefits will be limited because the number of patients is not large. The Government will have to take note, as indeed they are doing, of the so-called orphan drugs. It is also important to note there have been massive developments in neuro-rehabilitation in diseases such as multiple sclerosis, Parkinson’s, epilepsy and Alzheimer’s. All can have their effect increasingly modified, to the patient's benefit, by drugs and physical as well as psychological interventions; and in this respect it is crucial that the Government should support the roles of specialised nurses, physiotherapists, occupational therapists and other healthcare professionals.
Now for the basic bread—my remarks. Neurological conditions are common in the UK. The majority of them are long term, which inevitably puts anyone diagnosed with such a condition in regular contact with the National Health Service and social services.
My eldest daughter has had MS for over 30 years and she is supported by a wide range of services available at present. Sarah has attended more than 60 outpatient clinics at the National Hospital for Neurology and Neurosurgery in Queen Square in those 30 years. However, she is conscious that, expert as her consultant is, she sees his team only every six months. It is help with the day-to-day living that people with long-term neurological conditions need. By making telephone contact with her MS nurse, she is able to access help from the allied health professionals within the hospital and within the community.
Sarah receives community neuro-physiotherapy for a short six-week burst every few years. This is to help her to maintain her daily exercise routine and to learn new exercises to tackle new symptoms as they arrive. Occupational therapists help those with disabilities to learn how to adapt to their own specific everyday life. The occupational therapist helps Sarah with gadgets and key life skills to make everyday living easier. The podiatrist has made specially fitting insoles and toe props for her shoes so that she can continue to move around to the best of her ability to some degree. The dietician has tailored her eating patterns to assist with her energy levels. Sarah is always clear about the benefits of the support she receives. She says that their intervention has always made just managing all right into managing better.
The specialist nurse has an essential role to play too. I have always emphasised the value of specialist nurses in any field and never more so than in neurological conditions. Sarah is a patron of the MS Trust. There are real fears that specialist nurse posts are not being filled when they become vacant. The MS Trust, which provides specialist education and training for MS nurses and other professionals working with MS, keeps a log of all MS nurses in post and is extremely concerned that their numbers are reducing. There are not enough MS nurses in post to cover the 100,000 people with this condition. I would speculate that the same could be said for other specialist nurses across the NHS. Just this week, Macmillan and the Skin Association have told me of the loss of specialist nurse posts dealing with those conditions. Specialist nurses may cost more to train but they repay the NHS in huge benefits to patients and save the NHS money in the long term.
It is not just the NHS that helps people with long-term neurological conditions. Social services in local authorities provide adaptations, carers and help around the home so that the individual can continue to live within their community. The present pressures on local authority budgets are causing concern that they may result in cutbacks to services and, if so, this could have a very adverse effect on the lives of those dependent on those services.
The Department for Work and Pensions through Jobcentre Plus has a range of benefits that individuals can apply for. Many of these are under review as part of recent reforms. Disabled people are naturally concerned about the outcome of the Welfare Reform Bill and the detail is still awaited.
My daughter received help with travel costs, via Access to Work, from 1998 to 2007. This paid for a taxi to take her to and from work each day because she was unable to use any form of public transport at that time. Now that buses have been fitted with ramps, she can access these in her wheelchair scooter but she is still unable to sit for hours on buses, and distances travelled are therefore limited. However, she almost personally won that battle last year when London Buses decided that it could not allow buses to take electric buggies any more. She took up the issue with Transport for London and a decision has now been made on the exact weight of buggy that can be allowed on a bus without danger of breaking the ramp. The system seems to be working happily again. It was important to establish that before the Olympics and the Paralympics, when many people will be using that form of transport.
The Access to Work grant allowed her to stay in work, earning a wage and paying the requisite taxes, for a good 10 years longer than she would have been able to work without that support. The grant was a small amount compared to what she paid in tax and national insurance. It makes sense for the Government to ensure that this grant continues to be widely available.
If you are a person with a long-term neurological condition, it is vital that you have every opportunity to remain as well as you can. That will allow you to play your part in society. At the Neurological Alliance’s annual parliamentary reception a few years ago, the main speaker was Tom Isaacs, who has Parkinson’s. He was talking about long-term neurological conditions in general, and said that society and the NHS do not encourage people with long-term neurological conditions to become informed and to learn as much as possible about their condition. There are real worries that the services these people need to maintain their quality of life to the best of their ability may be lost in the changes.
I read that the Russians are developing a way of reproducing the myelin sheath, which is destroyed by multiple sclerosis. All such developments are a long way off, but a lot of research is being done. One thing we must accept is the indomitable spirit of people with these conditions, their unbelievably positive thinking and optimism. That is something we accept.
I also want to pay tribute to the number of voluntary organisations and charities that give their support to people with neurological conditions. There are too many to mention here and I would hate to miss any from the list, but their provision of information leaflets, practical advice, comfort in distress, and concerted efforts to make the conditions more widely known and understood is outstanding. We must also not forget the families and friends who help to care for individuals.
I congratulate the noble Lord, Lord Dubs, on bringing this subject to us, and this debate has been a good opportunity to place all these matters on record. I know that we have a caring Minister in the noble Earl, Lord Howe, and I am glad that he has found the time to be here for this debate, in spite of all the pressure he is under with his responsibility for the new health legislation.
Baroness Pitkeathley
My Lords, as I follow the noble Baroness, Lady Gardner, perhaps I may say that I have met her daughter, very much admired her indomitable spirit and am not surprised that she won her campaign with the buses. I thank my noble friend Lord Dubs for giving the House the opportunity to debate this important issue. Your Lordships will not be surprised to know that I want to concentrate mostly on the problems raised by families and friends who care for people with neurological conditions, and principally those who are looking after someone with conditions such as dementia and Alzheimer's.
First, let me say a word about the particular problems for carers of those with neurological conditions. Many of them are fluctuating conditions. MS is a case in point, as my noble friend and the noble Baroness have reminded us, so that the need for support is not constant. It is not easy, therefore, to have a once-for-all assessment which provides you with ongoing support. Sometimes, your needs are much greater than at other times, and that is often very difficult to feed into the assessment process. Carers nearly always have a problem identifying themselves as carers anyway—particularly as people with needs for help which are separate from but intricately linked to those of the person suffering from the condition.
People say: “I am not a carer. I am a wife, a husband, a daughter, a son”. Time and again, we come across the fact that once you have identified yourself as a carer, you can access services and people who can help you, but unless you make that connection, you cannot get yourself into the system. I will never forget a carer who some years ago gave me a wonderful analogy of that. She said, “I feel as though somewhere there is a great mushroom of information and help. If I could find my way to the stem, I would find my way up and into the mushroom, but I do not even know where the stem begins”. That is an interesting picture that we might keep in our minds. Those problems are especially acute for people with fluctuating neurological conditions.
I turn to a condition which, sadly, rarely fluctuates but is progressive and terminal and is the cause of huge stress for carers—perhaps, because of the very nature of the condition, it is sometimes more distressing for the carer than for the sufferer. I refer of course to dementia. Currently, 600,000 carers are looking after somebody with dementia and the number of sufferers, as your Lordships will know, is estimated to rise to at least 1 million by 2025. One in three people over 65 has some form of dementia, and a quarter of hospital beds are occupied by sufferers, so it is a huge problem of our time. It is associated with increased longevity—a cause for celebration, as we often say—but undoubtedly also a cause of stress for caring families.
The stress manifests itself in three different areas, all of which need support. First, there is the financial situation. Although many carers for people with dementia are themselves elderly spouses, there are still many who have given up paid work to undertake the task, resulting in substantial loss not only to their current but their future potential income in the form of much reduced pensions. The costs associated with caring, such as the need for increased heating—a particular problem at present with the rising cost of fuel—special foods, special transport, and so on are all a cause for concern. I make special mention of an often ignored problem: that of dealing with incontinence. Not only is it incredibly distressing to deal with, it also costs more. We are constantly hearing reports of how the rise in VAT has hit families who care, because they are having to spend more on a range of VAT-rated products such as cleaning materials, detergents, bandages and, in particular, continence pads and bedclothes. Families frequently raise the magnified impact of high energy costs, as they have to have the washing machine on every day to wash bedsheets and clothes as a result of incontinence.
The income of those families—those carers and sufferers—must be protected. I know that noble Lords who have been speaking on the Welfare Reform Bill—I am glad to say that some of them are speaking here today—have been really banging that drum. The House owes them a great debt of gratitude for all the work they have done thus far on the Welfare Reform Bill, which comes to us on Report next week. I know that the disability population owes them a great debt of gratitude.
Carers’ physical health is often also affected by caring. Sixty per cent of carers report a back injury of some kind. Although the noble Lord talked about the technology—hoists, and so on—time and again you hear families say, “They did not supply the hoist”; “It was the wrong kind when it came”; “I could not work it because they had not taken notice of the fact that my wrists are weak”; and so on. They are often affected by lack of sleep, as dementia sufferers often turn night into day and have to be watched constantly. Respite provision is increasingly hard to come by, carers report, as local authorities cut their budgets and as the voluntary sector, which often provides the best form of respite, is struggling to maintain services. Commissioners, who are always frightened about what carers will ask for if they ask them what are their respite care needs, should be reassured, because every piece of research shows that carers habitually ask for less than anyone thinks that they will want. You offer them a fortnight off and they say, “No, I do not want a fortnight off. What I want is one night's sleep once a fortnight or once a month”. That is not too much to ask considering that that is how we will keep the carers going for, often, many years.
Perhaps the most difficult problem that carers in this situation face is the emotional consequences of dealing with a loved one whose personality has changed, who may no longer recognise them and who may be aggressive—even violent—where once they were placid. Often, the potential providers of support focus entirely on the patient; they do not even notice the stress on the carer. Many a time, you will meet a carer who says, “The time the GP turned to me and said ‘How are you?’ was the most amazing moment, because I realised that someone else had noticed”. That is where carers’ support groups can be of tremendous help. They can meet other people in a similar situation and admit feelings that are hard to admit, such as the fact that you are violently angry with the person you are caring for.
I reiterate what has been the theme of your Lordships’ scrutiny of the Health and Social Care Bill. It is no use simply making changes to the NHS unless you include social care provision. It is not enough to increase inspection regimes or to talk endlessly about extra regulation. We have to change the culture surrounding the provision of social care. We had to change it at the Department of Health. I commend the work of David Behan, Paul Burstow and the Minister here on that. It is to be hoped that the forthcoming White Paper on social care emphasises that it is as important as healthcare. We have to change the culture in service provision, so that we regard services for people with dementia as ranking in importance with what we give to lifesaving surgery and medicine. It is not as glamorous, heaven knows, but those in the situation I have outlined regard it as of just as great importance.
We also have to change the culture of those who work in the service. I acknowledge the skills and dedication of many employees in this most difficult of areas, but too many employees’ values are not what we could wish. I was talking to a care provider recently who told me that they were turning the interview procedures for those who wanted to become care assistants on their head, so that they start by testing their values, not their skills and experience. We could do more to ensure that others do the same and reject those who do not meet the values test. Of course, as long as care workers are so poorly paid, it is difficult to increase the status of this work, but it should surely not be beyond the wit of those who work in the field to promote the fact that caring for those most vulnerable people carries with it more satisfaction than stacking shelves in the supermarket.
Caring for those with dementia is not a problem which will easily be solved, but as it is not going to go away, we must all take more responsibility for ensuring that we do it as well as possible. With one in three of the older population having some form of it, it will happen to every one of us or to someone we love in the foreseeable future.
Finally, without reiterating the long debate we had yesterday about the future of social care, and with apologies to the Minister for banging on endlessly about this subject, I feel that the long-term solution to the problems that we are looking at today is a partnership approach to the funding provision of care as set out in the Dilnot report. It seems to me that we owe that to the families who continue to care, who do it willingly and with love but rarely with enough support.
Baroness Thomas of Winchester
My Lords, I, too, am extremely grateful to the noble Lord, Lord Dubs, for introducing the debate and for allowing us to widen it a bit into, for example, the costs of being disabled.
The term “neurological conditions” covers a huge number of conditions, as has already been said. From motor neurone disease to autism, there are hundreds and hundreds. In the family of neuromuscular disorders, of which I know a little, there are also a huge number of conditions, even though they are considered rare or very rare diseases, with a cohort of only about 70,000 people altogether. I shall return to these particular conditions in a moment.
The noble Lord, Lord Dubs, resisted the temptation to rerun some of the debates in Committee on the Welfare Reform Bill about the personal independence payment, which is the replacement for disability living allowance from 2013. However, I shall give into temptation just a little bit, which I hope will be acceptable. Having to save 20 per cent of current expenditure could mean that some people with quite serious, but, say, fluctuating neurological conditions such as MS, which we have heard quite a bit about this afternoon, might not qualify for the award of PIP in the future—I declare an interest in that I receive DLA. This is why it is so important to get the PIP assessment criteria right before it is rolled out.
I am particularly tempted to say something about the Government's intention to take the aids, adaptations and appliances that disabled people use into account when assessing someone's eligibility for PIP, which could mean that the more determined a disabled person is to get out and about, the more they are penalised. We do not want a situation to develop whereby those who use, say, manual wheelchairs will not qualify because they do not get enough points on assessment, but those who use electric wheelchairs do. They may both need as much extra heating in their homes, or help with accessible transport such as taxis. Many of these people will have neurological conditions such as MS or Parkinson's disease. We need real clarification about how the use of aids, adaptations and appliances will be used to assess people who apply for PIP.
I will not say any more about the ramifications of the Welfare Reform Bill at this point, and will instead concentrate on the report just out, put together by my own consultant, Professor Michael Hanna of University College London Hospital’s NHS trust. His report analysed 266 unplanned hospital admissions for 200 patients with a neuromuscular disease across eight NHS trusts. The key finding of the data analysed was that 37 to 41 per cent of all emergency admissions could have been avoided, thus saving the NHS up to £31 million a year.
Neuromuscular conditions are progressive, so it is essential for patients to receive ongoing input from a co-ordinated multidisciplinary team of specialist health professionals to manage changing symptoms, to reduce complications and to provide expert advice on equipment and treatments. Many patients are still unable to access the right medical equipment and specialist physiotherapy, which can keep muscles supple and reduce the risk of falls.
At present, there are just 31 expert care advisers to support the 70,000 people with neuromuscular disease. This is half the number recommended by the Walton report in 2009, which criticised the NHS care of people with the various forms of muscular dystrophy as inadequate. However, the number of expert care advisers has more than doubled since 2008, following campaigning for these key roles by the Muscular Dystrophy Campaign. Having a neuromuscular care adviser in post can actually save the NHS money by, for example, allowing them to take on administrative tasks otherwise done by a consultant or GP, signposting patients to local services and liaising with other service providers. Dr Majumdar, paediatric neuromuscular consultant at Frenchay Hospital in Bristol, estimated that the neuromuscular care adviser there saved over 80 hours of consultant time per Duchenne muscular dystrophy patient over the lifetime of the condition.
The experience of the MDC with neuromuscular care advisers is mirrored by the experience of other groups. We have already heard how important the MS nurses are. The MS Society says that such nurses are a vital source of support, from managing relapses to giving advice on drug treatments, and, as with neuromuscular care advisers, acting as a gateway to other specialist services. As the noble Baroness, Lady Gardner of Parkes, said, 40 MS nurse posts are currently under threat in England, but the MS Society points to the savings that the NHS will make if there are enough such specialist nurses. Specifically, these nurses promote self-management and often prevent long hospital stays.
The same is true about Parkinson's disease nurses. They are an invaluable local source of expert knowledge and can help those who are newly diagnosed come to terms with the diagnosis. They can offer guidance on managing medication and make appropriate referrals on to other professionals, such as speech and language therapists and physiotherapists. Similarly, epilepsy nurses have the same sort of role and provide a source of expert knowledge and guidance. These specialist nurses and care advisers, as we have already heard, are the great unsung heroes of the National Health Service and their roles must be recognised for the tremendous support that they provide.
Turning back to Professor Hanna's report, I should say that, obviously, not all emergency admissions can be prevented. For example, although my condition is a muscular rather than a neurological condition, I myself had an emergency admission to St. Thomas's Hospital when I fell while trying to get into a taxi outside the Peers' Entrance four years ago. I am not sure that anything would have prevented my fall except for me to have been thinking more about what I was doing. However, the report's findings were broader, and showed that many emergency admissions could have been prevented with better planning. The four main factors that Professor Hanna identified in preventing emergency hospital admissions for those with a neuromuscular disease were: a delay in access to neuromuscular services; a lack of ongoing surveillance of the condition; the lack of an emergency plan; and the provision of appropriate equipment.
These findings backed up a report produced by the Muscular Dystrophy Campaign earlier this year, Invest to Save: Improving services and reducing costs. Tracey’s case is cited as a good example of a lack of planning. Her son has Duchenne, one of the most severe neuromuscular conditions. Despite being admitted to hospital with pneumonia, he was not assessed to be able to start treatment at home. With such treatment, his hospital admission could have been prevented. She said:
“My son’s first chest infection was pneumonia; in hindsight other professionals should have known he needed to start night time ventilation. Even after antibiotics and a 10-day stay in hospital, my son did not have assessments to determine his home ventilation needs. We should have been given instructions on chest physiotherapy and we should have had antibiotics at home to start treatment early. The hospital took several days to diagnose his chest infection believing it was a heart condition”.
Another shocking story about the same condition, but making a different point, illustrates why health professionals must find out about any emergency plan a patient has. Phillippa Farrant is from Eastbourne and has a 20 year-old son, Daniel, with Duchenne muscular dystrophy. He is seen at the Lane Fox unit at Guy’s and St Thomas’s Hospital in London. Speaking about Dan’s experience at the local hospital, Phillippa said:
“Dan goes in and out of hospital quite often and has received some good care but other times it has been horrifying. Boys with Duchenne … are prone to chest infections, partly because they become unable to cough and clear their lungs. This August, when I took Dan into the hospital with a chest infection they said it was just pain caused by him coughing a lot—a ridiculous idea as he has been physically unable to cough for years. I told them they were wrong and asked them to call the specialist but they refused. Delays in treatment like this are really dangerous for boys like my son. I am furious they played with his life in this way”.
I fear that the refusal or reluctance of healthcare professionals to co-operate in this way across different hospital trusts is all too common, and must change if patients’ lives are not to be put at risk.
I shall end with some positive news. Thanks to the MDC, a national neuromuscular work plan has been undertaken by the specialised commissioning groups across England since April of this year. They presented the results of the work they have done so far towards the national plan at a workshop in Cambridge this week. So we move slowly forward, but there are many challenges ahead in the complex and varied field of neurological conditions. It is vital that, in the new NHS landscape being created, no one is left behind.
Baroness Hollins
My Lords, I am grateful for briefings from the Spinal Injuries Association, and from my daughter, who has tetraplegia, and to the Motor Neurone Disease Association. I am also glad to participate in this debate, which allows for deeper thought about the needs of people with neurological conditions than is possible in the lengthy debates around the Health and Social Care Bill, and indeed the Welfare Reform Bill.
I have learned, and am still learning, about the disabling barriers that people with different impairments encounter, both as a doctor working with disabled people over the last 30 years, and also as the mother of two adult disabled children. I am convinced that policy will not be effective if the social model is not fully embraced as part of the foundational principles underlying legislation. But some needs are medical, and require highly specialist expertise. I would like to draw attention to the fact that medical research into neurological conditions is grossly underfunded.
It would also be remiss of me not to mention the importance of attending to the emotional and mental health needs of patients with neurological conditions. I am thinking here particularly of newly spinal cord-injured patients. It is not just the obvious psychological adjustment to a new impairment, and all the learning required to keep well and to reintegrate into society. We should remember that many people acquire spinal cord injuries during a failed suicide attempt and there may be an underlying mental illness which also requires active treatment. It is the partnership between medical and social agencies working with the disabled person that will best meet that person’s needs, and the needs of their family, while recognising each person’s right to respect for their private and family life, as provided by Article 8 of the European Convention on Human Rights.
In 2009, the NHS published an updated National Framework for NHS Continuing Healthcare and NHS-funded Nursing Care, for use in England with revised eligibility criteria. In paragraph 79 of the framework, explicit mention is made of the Coughlan ruling under which a person with a high-level spinal cord injury or similar health need is entitled to continuing healthcare funded by the NHS. The purpose of the continuing healthcare assessment is to establish whether an individual’s care needs are primarily health related or social in nature. This is done by measuring the totality of their care needs according to their nature, intensity, complexity and/or unpredictability, and gives rise to the concept of a primary health need. These assessments are done at the time of initial diagnosis, they are reviewed regularly and there may be a reassessment when a person’s needs have changed.
For many people, securing continuing healthcare funding is fundamental to enhancing their prospects in rehabilitation and their prompt discharge, and thereafter in the community in reducing the likelihood of complications requiring hospital readmission. However, outcomes for individuals seeking continuing healthcare are very uneven and unpredictable across the country—a classic postcode lottery.
A primary cause for concern is the lack of quality clinical input into these assessments from professional practitioners with experience of spinal cord injury and of the patient in question. Often, no opinion is even sought when assessing patients in the community. A detailed and insightful clinical assessment from a spinal cord injuries centre consultant carries significant weight, but is all too often a key missing component. In the community, in particular, the patient is frequently left to persuade sceptical assessors, and when declared ineligible, to battle the bureaucracy of the primary care trust alone.
Unfortunately, there are an increasing number of appeals by people with tetraplegia who are being found ineligible for continuing healthcare funding, although those who appeal are often later found eligible. For people with some neurological conditions the award of continuing healthcare funding will be welcomed, but for others it will not. Consider someone with spinal muscular atrophy, which is a degenerative condition. For much of that person’s life, any support needs will be considered primarily social in nature and, appropriately, funded by the local authority. Increasingly, people are receiving direct payments to employ their own personal assistants. However. when a person’s condition leads to them needing more intensive support, such as being on a ventilator or needing a personal assistant 24 hours a day, some social services departments are asking the local PCT to pick up the funding under CHC rules.
Some people, including some with spinal cord injury, do not want to move on to continuing healthcare funding when their condition deteriorates because they will no longer be allowed to employ their own staff—personal health budgets allowing this are not yet available. The Secretary of State has announced that personal health budgets will be rolled out in 2014 subject to the evaluation of the pilots, and I think that will be welcomed.
There has been quite a lot of talk also about the need for a change in the law to allow people to take their support package with them if they move area, and indeed my noble friend Lady Campbell, who sadly cannot be here for the debate today, has had the first reading of a Private Member’s Bill to introduce a right to portability of support. However, I suggest that portability is not just a matter of geographic portability but should also apply to a change in the funder from social services to health, and vice versa.
Case law—and here I mean the Coughlan criteria—clearly indicates that if you have tetraplegia, you should be eligible for continuing healthcare funding. But many PCTs have been resisting their responsibilities and refusing to honour the Coughlan criteria. Some PCTs, such as Norfolk, have apparently sought to introduce a blanket requirement that anybody receiving complex medical care and considered to be at high risk will no longer receive continuing healthcare in their own home and will have to move into nursing home care, because it is thought to be cheaper.
Rehabilitating people with spinal cord injury in the community requires a positive and active engagement with friends, family and the wider community. It requires an integrated, collaborative, and joined-up approach by the NHS and the local authority, in which recovery is understood as being as much about removing social barriers as about medical treatments. It may require, for example, disabled facilities grants to adapt living accommodation, and the installation of environmental controls. It requires financial support to pay for the extra costs of living as a disabled person.
One of the biggest worries for someone with a spinal cord injury is the risk of pressure ulcers, and the absence of ulcers is usually down to good care. It does not require health professionals to deliver this care, but it does require specially trained personal assistants working under the direction of the spinal cord-injured person. The cost of treating pressure ulcers to the NHS and to the individual is very high.
Prevention must be the priority, but that requires that people with spinal cord injury are well trained and can train specialist PAs to support them. If they go into hospital for medical treatment, it is critically important that their personal assistants continue to support them in hospital, working alongside the clinical team whose job is to attend to the reason for the clinical admission. However, some people with spinal cord injury find that their personal assistants are not allowed to accompany them to hospital and so leave hospital in a worse condition. I would like an assurance from the Minister that the Government support the continuing involvement of personal assistants in the personal care of someone with a spinal cord injury who is in an NHS hospital.
The most obvious addition to a person's daily life is a wheelchair. We have already heard something about wheelchairs. An adequate, well fitting wheelchair is of critical importance in enabling somebody with spinal cord injury, motor neurone disease or another neurological condition to participate in their local community. The current wheelchair service is too slow to respond to the needs of someone with, for example, motor neurone disease. Some people wait as long as two years after the need for a chair has been agreed. Half of those with motor neurone disease die within 14 months of diagnosis. I have heard that some people do not receive a wheelchair in their lifetime because of the unresponsive nature of the wheelchair service. I know that the Motor Neurone Disease Association would like to become a provider of wheelchair services to get round this problem. I hope that the Minister will endorse that aspiration and that it will not be disadvantaged in competition with larger commercial providers.
Another issue of real concern is the lack of palliative care provision for people with motor neurone disease. This is entirely unacceptable. If there is any condition for which excellent palliative care is required, it is motor neurone disease. In Southampton, for example, there is no palliative care provision for people with motor neurone disease. The association is calling for widespread availability. Can the Minister confirm that palliative care services for people with motor neurone disease will be included in the pilot work associated with the current review of palliative care?
For all these conditions there are concerns about how services will be commissioned in future. Will the Government issue guidance on when services should be commissioned jointly for these complex but relatively rare conditions? I am talking about commissioning both at the acute stage and in the longer term for people with complex neurological conditions. The NHS Commissioning Board and clinical commissioning groups will of course need to recognise the difference in commissioning for people with spinal cord injury—normally a fairly static long-term condition, with the prospect of somebody in their 20s living to 70—and for people with a deteriorating condition such as spinal muscular atrophy. What is not clear in discussions on the Health and Social Care Bill is where responsibility for commissioning continuing healthcare will lie in the future. The Minister's response to this question would also be welcome. Certainly, risk sharing between several clinical commissioning groups will be needed to make locally funded continuing healthcare a viable prospect.
With respect to spinal cord injury, does the Minister agree that specialist treatment in spinal injury centres leads to the best chance of recovery and rehabilitation in both the medical and social meanings of the words; that the decline in the number of people with spinal cord injury being admitted to spinal injury centres is to be deplored; that people with spinal cord injury should be treated in such centres both acutely and over their lives, as they need to be readmitted for complications from their spinal cord injury to be managed and treated; and that the National Spinal Cord Injury Strategy Board, which is to be nationally commissioned in future, should also be involved in ensuring that continuing healthcare is appropriately commissioned?
Baroness Gale
My Lords, I congratulate my noble friend Lord Dubs on securing this really important debate today. Many noble Lords will be familiar with the condition of Parkinson's disease, for which there is no known cure. When one is diagnosed with Parkinson's, one has it for the rest of one's life and has to adjust to one's new life. That is why research needs to continue and must not be the victim of cuts. It was reported in the national press at the weekend that academics claimed in a study that they feared that the cuts would prevent or cut back on research into Parkinson's and other diseases. I hope that that will not happen, otherwise further delays will be inevitable in finding a cure for Parkinson's and other neurological conditions.
People with Parkinson's need a range of health and social care support, which will change as the condition progresses. I will highlight a few of these areas today. The APPG on Parkinson's, which I chair, carried out an inquiry in 2009 and later published its findings in a document entitled Please Mind the Gap: Parkinson's Disease Services Today. The report highlighted disparities across the UK in access to support by people with Parkinson's. Two years on, gaps still exist and I am concerned that the current upheaval in the NHS in England, combined with the financial pressures, could exacerbate the situation.
The charity Parkinson's UK runs an audit each year in collaboration with the Healthcare Quality Improvement Partnership to see whether NICE guidelines for Parkinson's disease are being adhered to. The results are reported in the quality account of each trust and are an excellent way to see if evidence-based standards of quality care are met across the country. The audit has revealed gaps, but the tool provides a way for primary care trusts to measure the areas for improvement. Currently the HQIP is conducting a consultation on which audits will be incorporated into the quality accounts for 2012. If audits such as that for Parkinson's are not included, it will be a backwards step in promoting quality. Clinical audit is one of the most effective ways to measure where standards are being met and to look for service improvements. There is a risk that trusts will only prioritise those they are required to complete and that others will not take place. The National Audit Office has recently conducted an audit to see if services for progressive neurological conditions represent good value for money. The findings are expected to be released soon and will provide an assessment of the support for people with neurological conditions.
Several noble Lords mentioned the value of specialist nurses. I will mention Parkinson’s nurses. Parkinson's UK has invested more than £12 million to pump-prime specialist Parkinson's nursing posts across the UK, demonstrating its commitment to improving standards of care within the NHS. However, 20 per cent of PCTs still have limited or no coverage. Losing community-based Parkinson's nurses could cost the NHS up to £19.5 million in increased admissions and demands on consultant time. Losing hospital-based Parkinson's nurses could cost the NHS up to £15.6 million in longer times spent in hospital. Employing an extra 60 Parkinson’s nurses would provide adequate access across the UK and could save £7.1 million.
Clinical commissioning groups need support and guidance to commission good-quality Parkinson's services that are cost-effective. This support needs to come from networks and clinical senates that understand Parkinson's and can advise clinical commissioning groups about what is needed. Will the Minister give a commitment to support clinical commissioning groups by ensuring that there are neurology networks across England and neurology specialists on clinical senates?
Continuing care is a vital package of care that is arranged and funded by the NHS and is free of charge to the person receiving the care. The decision on eligibility rests not on the condition but on whether the need for care is primarily owing to health needs. My concern is that, in these austere times, decisions could be influenced by financial concerns rather than solely by clinical criteria. It seems that there is an increase in cases being assessed as social care needs, rather than as healthcare needs. Of course, one of these is free for the person with Parkinson's and the other can be highly expensive. A national support tool exists to help score someone's health needs, but it is not sophisticated enough for a condition such as Parkinson's or for the side effects of Parkinson's medication. There is also a lack of awareness of Parkinson's among some assessors. People with Parkinson's and their families report inadequate periods of time for the assessment, resulting in a false impression of the person. Judgments can be made on nursing home or hospital notes that do not adequately reflect the person's symptoms and fluctuations. Will the Minister agree to conduct a review of this tool so that it does not disadvantage people with progressive and fluctuating neurological conditions?
Budgetary considerations mean that there is little incentive for the NHS to tell people about their rights to continuing care, nor has the NHS any incentive to make timely decisions once someone has applied for NHS continuing care. If a person's case is rejected, the appeals and tribunal processes can be lengthy at a time when a person may be at their most vulnerable. There are cases that have been in the system for over three years.
Many people with Parkinson's face having their continuing care funding withdrawn in the later stages of their illness. The reason given is often that their decline is now predictable or that they have stabilised despite the severity of their situation. It seems to me that this is a total contradiction to the families involved, who are bearing witness to a distressing and progressive loss of function in their loved ones. Reports suggest that PCTs are instigating reviews not because of a change in health needs but because of budgetary constraints. Funding is then withdrawn following reassessment. The reason given is that presenting health needs are deemed to have stabilised despite the severity of the condition or that their decline has become predictable. This is despite the decision support tool for NHS continuing healthcare noting that well managed needs are still needs. The King's Fund and the Alzheimer's Society have recently reported a similar pattern of decisions in respect of people with dementia. Will the Minister agree to consider this difficult matter of continuing care and to make it clear to all concerned that people with an advanced degenerative health condition should not have their continuing care or nursing care contribution packages withdrawn on the basis that their decline in health is predictable or that the condition has stabilised? At the same time, will he clarify who will undertake eligibility assessments and appeals for continuing care under the new system and consider how it will ensure that decisions are person-centred and made independent of budgetary constraints?
I think a theme has been developing over the course of noble Lords’ contributions today. I know that people are fearful and worried in today’s climate. I hope that the Minister can give some assurances on this. People with progressive neurological diseases have enough worries about their illnesses. They need reassurance that they will be able to get, for example, the support of the specialist nurses they need. This makes good economic sense, and I hope the Minister will consider this and can reassure people with these conditions that we can alleviate at least some of their worries.
Lord Monks
My Lords, I am pleased that my noble friend Lord Dubs initiated this debate, and I congratulate him on focusing the attention of the House on this family of illnesses, which too often can be relegated slightly in the list of priorities. Like many other noble Lords, I have a direct connection. My 35 year-old son has MS. I do not have to labour the impact of that unpredictable illness on people in their prime. It damages and can then shut down different parts of the body as it tightens its hold on the vital organs of life.
It is invidious to compare one serious illness with another, but the neurological illnesses mentioned by my noble friend Lord Dubs and other noble Lords in this debate attack dignity and self-confidence and must be among the worst in the list of illnesses. As yet, there are no cures and, in truth, there is not much early prospect of them. There is a most depressing outlook for the 100,000 or so people with MS in the UK and for the many others with other neurological illnesses. Sometimes the only medical advice available is, in effect, “Grin and bear it”.
My concern today is to lend my support to those who seek for greater priority to be given to these diseases. As we know from a short exchange in the House recently on a Question by the noble Lord, Lord Walton of Detchant, the National Institute for Clinical Excellence seems in no particular hurry to revise its list of approved treatments. I understand its problems in matching limited resources to a wide range of demands, but I want the House to send a message that while perhaps these illnesses tend to lack the massive, fashionable and effective supporters that a few other grave illnesses have managed to muster—and good luck to them—there should be no treating MS and other neurological illnesses as lower-priority also-rans when it comes to the allocation of resources. As I understand it, at the moment, NICE is thinking of 2013-14 for its next major review of MS treatments. That feels a long way off for sufferers, and it is frustrating for them to be denied access to drugs which might help improve their condition on grounds of cost. For example, NICE has just issued a second provisional no for a drug, the first pill licensed for relapsing remitting MS. This was done on grounds of cost. I understand that the decision has been taken in the face of strong support for the drug from the MS medical community and from many sufferers and organisations. NICE has recognised that the drug is clinically effective and highly innovative. It is available in some other European countries, including Germany, Italy, Sweden, Switzerland, Norway, Greece and Denmark. The House will know that some of these countries are less well placed economically than we are.
As the noble Lord, Lord Dubs, said, the recent report for the Department of Health by Sir Mike Richards scored the UK 13th out of 14 regarding patient access to existing and new forms of treatment for MS. This is plainly not good enough. I am long enough in the tooth not to believe all the hype and publicity of the pharmaceutical companies for their latest wonder drugs, but 13th out of 14 cannot be good enough for a country with as many MS sufferers as we have. Nor is it good enough, as a recent Work Foundation report showed, that in the UK 44 per cent of people with MS retire early due to their condition; this is higher than the European average of 35 per cent. Of course, in time this increases the costs to the welfare state by the resulting additional demands on the employment and support allowance system.
I ask the Government and NICE to recognise fully the terrible nature of this family of illnesses and—please—to give them the priority that they need and their sufferers deserve.
Baroness Masham of Ilton
My Lords, I thank the noble Lord, Lord Dubs, for having secured this very important debate.
In 2007, the Department of Health issued a national framework for NHS continuing healthcare to try to improve the consistency of approach taken by local NHS bodies by providing a common framework for decision-making and the resolution of disputes. The national framework explains that the services provided as part of that package should be tailored to meet the specific health and social care needs of the individual and should be seen in the wider context of best practice and service development for each client group. Eligibility for NHS continuing healthcare is not based on having a specific medical condition and places no limits on the settings in which the package of support can be offered or on the type of service delivery. Why has this not proved to be effective?
I was pleased to read yesterday in the Times about the pledge to enhance quality of life for people with long-term conditions and a drive to ensure that people have a positive experience when using the health service. Has the 60-step plan been put out to allay fears about the Health and Social Care Bill, which is leading to so many changes and insecurities? Some people feel that localism could mean a postcode lottery. Many people with long-term neurological conditions depend on the correct drugs for their needs. There are only a few treatments for people with MS, so they should be sure of having access to them. The correct epilepsy drugs are also vital.
Care for patients with long-term neurological conditions has traditionally been based in district general hospitals or out-patient clinics of regional neuroscience centres. It is generally consultant-delivered, with, more recently, specialist nurse input. Specialist nurses make all the difference. They teach patients and carers and they are the consultant’s right hand. They link primary and secondary care. A shortage of specialists and a lack of multidisciplinary working have resulted in patchy support for these patients; for example, Epilepsy Action reported that in England in 2008, 50 per cent of trusts did not have a consultant with special expertise or interest in epilepsy and 60 per cent of trusts had no epilepsy nurse.
The Sentinel audit of epilepsy deaths noted that a number of those who died had not seen a neurologist in the preceding year despite still having seizures. Parkinson’s UK showed that despite NICE guidance, 15 per cent of patients have never been seen in hospital by a specialist; 30 per cent diagnosed within the last year have never seen a PD nurse; the majority have not received multidisciplinary team assessment or treatment; and a third of patients admitted to hospital did not feel that the staff knew anything about Parkinson’s disease. Patients with neurological conditions need the correct medication, which needs monitoring. They need to be under a specialist for changes in their condition and to be kept as well as possible. The effectiveness of their drugs needs to be recorded.
Most patients with straightforward stable neurological disorders do not need continuing care at a hospital. However, they need the reassurance that they are being cared for within a network of care that encourages shared best practice, good communication and easy access to the service when and where necessary. With so much change, now is the time for patient involvement and a strong patient voice. If conditions such as strokes can be prevented, so much the better. It would be interesting to hear from the Minister how much better the outcomes have been since the introduction of statins.
I have a few personal experiences in the neurological field. I have a niece who has epilepsy. When she lived in London and was looked after by one of the London hospitals, she had numerous seizures. One day during a seizure when she had collapsed on the pavement, someone picked up her handbag and took it to a police station, leaving her to find that the bag had gone when she came to. After that, we gave her an identification bracelet. Whenever she had a check-up, she was seen by a different junior doctor. There was no continuity of care. On one occasion, she had a seizure in my car. But I am pleased to say that she is now happily married with a young boy and is looked after by a specialist unit.
My sister-in-law’s brother-in-law developed motor neurone disease. I agree with the MND Association. Because of the rapid progression and wide range of symptoms, people with MND have complex and demanding care and support requirements. They need what they need straightaway. Currently, there is no national guidance for MND. The MND Association is calling for NICE to produce a clinical guideline and quality standard for MND. David was a strong man who deteriorated very fast and is now dead.
I am someone with a spinal injury. Damage to the spinal cord leaves a person, if the lesion is complete, without feeling or movement from that area down. The treatment can cover neurology with such complications as autonomic dysreflexia, which involves blood pressure; urology, because the bladder and bowels are paralysed; and orthopaedics. So many complications can arise—such as serious pressure sores, mentioned by my noble friend—that treatment in a spinal unit with staff specially trained in spinal injury is essential.
When I left hospital and lived in Yorkshire, I found that without a voluntary association to support people with spinal injuries and to educate the public, there was a big gap. With some others, we founded the Spinal Injuries Association. We support members with information and advice. We have purpose-built headquarters and, now, a library and a helpline. We have peer support for newly paralysed people. We are involved in a training scheme for helpers with Stoke Mandeville spinal unit and Buckingham University. We could not do this without our valuable fundraisers.
Many neurological conditions need voluntary organisations to help members and to speak out on their behalf. That is essential. There is ongoing need for research into these varied and complicated conditions. There is also a need for new and effective medication. I should like to add my plea to the Minister to look into the wheelchair service for all who need it, including disabled children. This needs urgent rehabilitation.
Lord Macdonald of Tradeston
My Lords, I declare an interest as patron of the Dystonia Society. Dystonia is a neurological condition that causes involuntary and sometimes very painful muscle spasms as a result of incorrect signals from the brain. These muscle spasms can force affected parts of the body into abnormal movements or postures. There are thought to be over 70,000 people in the UK who have some form of dystonia, of whom 8,000 are children. It is a cruel condition in that the earlier it starts, the more it spreads. Dystonia that appears in childhood often starts in an arm or a leg. The limb twists and contorts, and the condition then spreads to other areas, perhaps affecting the other arm or leg, the torso, and sometimes the whole body. It can cause severe difficulties with standing, walking and even sitting. Dystonias that appear in adulthood usually affect only one or two parts of the body. The most common types affect the neck or the eye. Neck dystonia usually forces the head and neck to one side, which can be extremely painful, while eye dystonia forces the eyelids shut, sometimes causing functional blindness. Other parts of the body that can be affected include the hands, voice, mouth and tongue. Dystonia can have a devastating impact. The pain and disability caused by muscle spasms and the unpredictability of the symptoms take a heavy toll on an individual’s quality of life.
Dystonia is unusual in that it is not degenerative, but it is also not curable, so people with dystonia often have to live with its disabling symptoms for 40 to 50 years or more. It is therefore essential that they receive treatment that effectively mitigates their symptoms. This can make the difference between a lifetime of disability, relying on others for care and benefits, or a life of economic independence, actively contributing to society. The most common treatment for dystonia is injections of botulinum toxin, which temporarily paralyse the spasming muscle. Where botulinum toxin and other treatments do not work, the treatment of last resort is deep brain stimulation. An electrode is implanted in the brain and connected by an internal cable to a battery implanted in the chest. The electrode sends a pulse that blocks the incorrect signals in the brain, stopping the involuntary spasms.
Support for people with dystonia is provided by the Dystonia Society, a UK charity which aims to ensure that everyone living with dystonia has access to the support and treatment they need in order to enjoy the best possible quality of life. The society also provides information to those who need it, and advocacy where patients are not receiving the treatment they require. It also provides networks and events to enable isolated patients to share experiences and be given encouragement. The Dystonia Society also works with clinicians and commissioners to improve practice in treating dystonia and to raise awareness of this too little known condition. I draw the attention of the Minister to the sad fact that currently there are a number of shortcomings in the provision of treatment for dystonia.
First, because of a worrying lack of awareness among medical professionals, diagnosis takes far too long, at an average of two and a half years for those who do get diagnosed. The Lancet has estimated that at least a third of cases are undiagnosed. Of course, a GP may see only a few cases of dystonia over a career and cannot be expected to recognise every condition; but far too often, symptoms that clearly indicate a likely neurological problem are dismissed as psychological. There is therefore an urgent need to ensure that GPs are given more effective guidance on investigating symptoms where they are not sure of the diagnosis.
Secondly, there are problems with the provision of funding for the treatment of last resort, deep brain stimulation, in some parts of the country. For a small minority of patients in the UK, around 50 a year, other treatments are ineffective, so they require deep brain stimulation as the final option; otherwise they have no alternative to a life of severe disability, which also results in extra costs for the NHS and society in paying for hospital stays, carers and welfare. Some regional specialised commissioning groups have recognised the importance of deep brain stimulation for this small group of patients who are most desperately in need of treatment. In 2010, the East of England and the South West Specialised Commissioning Groups conducted reviews and, on the basis of the evidence, approved funding. Conversely, in the east Midlands, a blanket decision has been taken not to fund deep brain stimulation for dystonia, a dismaying decision which I hope can be reconsidered, since it ignores the overwhelming clinical support for this treatment and fails to recognise its considerable value in reducing costs to the NHS and society. The Dystonia Society is concerned that deep brain stimulation could be under threat as specialised commissioning moves under the auspices of the NHS Commissioning Board. The danger is that access will level down rather than up—for instance, extending the policy of the east Midlands rather than adopting that of the south-west or east of England, where treatment is routinely funded.
There is also a problem with the funding of botulinum toxin in some areas for the rarer types of dystonia such as voice and hand dystonia, despite this treatment being recommended as good practice by the European Federation of Neurological Societies. As these conditions are rare, it is not judged economically viable to obtain Medicines and Health Care products Regulatory Agency licensing despite the treatments being shown to be effective. It seems most unjust that people are being denied treatment simply because their condition is not widespread—the red tape here could surely be cut. In addition, the provision of important additional support, such as pain management and speech therapy, is very variable across the UK.
The main fear is that the number of cases where effective treatment is not provided will rise. As cost pressures increase, hidden cost savings may be made through an extension of the period between botulinum toxin injections. As the benefits of botulinum toxin wear off in around 12 weeks, it is essential that treatment is repeated promptly at clinically appropriate intervals. Dystonia is a lifetime condition, and if those affected are to remain active contributors to society, it is essential that their symptoms are continuously managed. If injections are de1ayed, they may experience a cycle where they have two or three months of being effective and then one or two months of disability as they await the next injection, which is surely an unacceptable compromise. Clearly it would be very difficult for someone to hold down a job or look after children in such a scenario.
I thank my noble friend Lord Dubs for initiating this important debate and for giving me this opportunity to draw to the attention of the Minister and his department the under-recognised needs of the 70,000 people who suffer with the disabling and painful neurological condition of dystonia.
Lord MacKenzie of Culkein
My Lords, I, too, thank my noble friend Lord Dubs for securing this important and timely debate. It is important because there is a need for the difficulties encountered in getting high-quality care and support for persons with neurological conditions to be highlighted as much as possible; it is timely because of the present consideration in this House of the Health and Social Care Bill.
I want, if I may, to concentrate in the time available on motor neurone disease. When I practised as a nurse, I never came across this ghastly, fatal and rapidly progressing illness. Most general practitioners will perhaps see one or two cases in a working lifetime, and that is at least part of the problem when it comes to commissioning services. While there are some 5,000 people living with motor neurone disease in the United Kingdom at any one time, the condition is not common enough to appear on the radar in the face of the much more common conditions which we hear about all the time, such as stroke, cancer and cardiac conditions.
We had 60 new targets and outcomes announced yesterday, designed to assess quality of care. I have not yet had the opportunity to look at these indicators in detail, so I wonder whether there is one for long-term conditions. Will the Minister tell the House whether any of these indicators refer to the quality of care for someone living with motor neurone disease or other long-term conditions, and how such an indicator will assist in holding the NHS Commissioning Board to account? I note that the Secretary of State said that the department and Ministers would not interfere in how these quality outcomes were dealt with locally. Well, I wish that they would. I wish that something could be done more forcefully, better to ensure proper care and outcomes for patients with long-term conditions.
We dealt with this issue at the Committee stage of the Bill. It is the view of Ministers that the proposed framework provides for the potential for a change in the culture of the National Health Service in its approach to commissioning for long-term conditions. However, there is nothing in the Bill to ensure that cultural change. There are many promises and aspirations about the future, but they are peppered with words like “could do”, “may do” and “as they see fit”—not “will do” or “must do”.
The average survival for a person with MND is something like 14 months after diagnosis. As we know, it is rapidly progressing condition and has high need. I am advised by the Motor Neurone Disease Association that there can be as many as 18 different health and social care professionals providing care at any one time. I can provide testament to that. When my friend lived with and later died from this disease, he had very many professionals and carers involved in providing care, which was better in his case than many receive, but they still struggled to cope with the rapid deterioration and progression of the disease.
As well as high need, there is high cost with motor neurone disease. It is estimated that quality care can cost as much as £200,000 per annum. However, poor care can lead to crises and to unplanned hospital admissions, and costs can easily double. There is also some evidence, as I understand it, to the effect that the incidence of admissions to A&E of persons with MND is increasing. That is a worrying trend which should not be happening and is indicative of the patchy nature of care and financial pressures on social services in different parts of the country. The noble Baroness, Lady Finlay of Llandaff, told us last Wednesday about the lack of end-of-life care in Southampton; and the noble Baroness, Lady Hollins, has reiterated that this afternoon. It is not a case of poor care but a case of denial of access to end-of-life care.
I find it difficult to understand how present-day commissioners can sleep at night when few or no steps are taken to enable people with motor neurone disease to have the best quality of life and dignity in death. Dying badly is not something that should happen to anyone. Having seen the pressures on a family where care was reasonably good, I cannot for the life of me imagine how awful it must be where that care is denied. I fear that the funding pressures now facing the health and social services may mean that we see more Southamptons.
We need good practice to be built on. We need that good practice to be embedded in pathways and systems and we need it to be made sustainable rather than to rely on the individual clinical champions. Let us keep the patient out of hospital by avoiding crises and treatment that is not appropriate. Let us provide the support and the necessary adaptations to enable people with motor neurone disease to live at home with their families. That is good for the patient and it is cost effective.
As the noble Baroness, Lady Hollins, reminded us, the Government have recently announced palliative care pilots as part of their work on the palliative care funding review. I agree that it would make much sense for people with motor neurone disease to be included in the pilots, which should enable a tariff to be developed for these complex and demanding needs. Can the Minister say whether palliative care services for people with MND will be included? I hope he will confirm that.
I have mentioned services that can help people with motor neurone disease to live at home. When my friend was living with this disease, and despite the best efforts, none of the adaptations made to his home or equipment provided could keep pace with the disease progression. The noble Baroness, Lady Masham of Ilton, put it very well. These needs have to be met straightaway. In my friend’s case a particular example was wheelchairs. Quite early on, when he still had some mobility, it was decided that an electric wheelchair would be provided, but one did not appear until he had lost the use of his hands and could not use it. Had it been delivered on time he could have had some months of relative freedom. It is a story that I have heard all too often.
The noble Baroness, Lady Hollins, has also reminded us that the Motor Neurone Disease Association—to which I pay the greatest tribute for the work it does in supporting people affected by MND—has told us that many people have difficulty accessing wheelchairs appropriate to their needs and that, shockingly, as many as 500 people at any one time are waiting for wheelchairs, some for two years. That is totally unacceptable in a modern society. How many of us would like a relative or friend confined to their house—or, worse still, to an upstairs bedroom—for months? Yet that is not hyperbole; it is the reality for all too many.
This brings me back to the Health and Social Care Bill. As we know, the Motor Neurone Disease Association has developed a good partnership model with wheelchair services in pilot areas to ensure that people with MND have access to a wheelchair that is appropriate to their needs. The association would obviously like national expansion of this effective model for assessment and provision so that the present inequality of provision can be dealt with.
As the noble Baroness, Lady Hollins, said, the Health and Social Care Bill provides an opportunity, with the concept of “any qualified provider”, for the Motor Neurone Disease Association to expand its excellent work in providing a fast and efficient service. However, as we have heard in past debates, it is concerned that small third-sector organisations might be disadvantaged in the bidding process. Can the Minister confirm that small third-sector organisations, which are extremely important and valued in the provision of care, will not be disadvantaged against the larger organisations, which have all of the firepower when it comes to applying for “any qualified provider” status?
I hope that this debate today will contribute to the growing awareness of the need for joined-up care for people with long-term conditions. The Health and Social Care Bill fails, in my view, to provide for the integration of care between health and social services which, as my noble friend Lady Pitkeathley emphasised so well this afternoon, is really needed.
I fear for the transition stage. I think that I have seen something like 19 reorganisations of the health service, in one form or another, since I commenced nurse training in 1958. They have all caused disruption, and quite a few have caused disarray. I think that the Motor Neurone Disease Association is right when it expresses the view that some people will be diagnosed, experience the entire course of their illness and die before the NHS and social services get anything like back on an even keel. It is essential that high quality services are available throughout this time of transition. I share that hope and I look forward to what the Minister is going to say in response to this debate.
Baroness Thornton
My Lords, it is an honour to be replying from our Front Bench to the debate initiated by my noble and long-standing friend Lord Dubs. As ever, it has been an excellent debate, revealing the depth of knowledge residing in your Lordships’ House.
Neurological disorders are very common. They account for 10 per cent of all GP consultations and around 10 per cent of acute admissions to hospital, excluding stroke, and amount to a disability for about one in 50 people. They range from migraine to motor neurone disease. I was very struck by a fact in the extremely helpful June 2011 report about neurological disorders, compiled and written by the Royal College of Physicians. It said that, unlike stroke, acute neurology services are rarely provided by neurologists in hospitals when people are admitted with acute conditions, which the Royal College of Physicians believes has adverse outcomes for patients. How many neurological consultants are there and how many do the Government estimate are needed? If the noble Earl agrees that there is a gap between those two numbers, what do the Government intend to do about it?
The report makes three proposals, which are worth quoting here. First, it says that local services should be expanded and improved, with a shift in emphasis from scheduled to emergency care. Secondly, it says that there should be better organised care for patients with long-term neurological conditions, managed in part through an enhanced role for specialist nurses and general practitioners with specialist knowledge in neurology. Thirdly, it says that there should be better local planning of services with increased clinical involvement within a commissioner-provider forum, creating a neurological network to improve clinical and financial outcomes. How will those proposals be delivered under the new architecture proposed for the National Health Service in the Health and Social Care Bill, and how will specialist nurses be trained, retained and encouraged under this new architecture? Will it be done through CCGs, the National Health Service Commissioning Board, or where?
I turn to some specific conditions. I am very grateful for the briefings that we have received from a range of organisations, which shows the strength of the Neurological Alliance. I commend it for the work that it has done. On epilepsy, the provision of services is actually rather poor, and I think that other speakers may have suggested that that is the case with other conditions. People seem to agree that provision is rather poor, and yet it seems that action is slow in coming. My noble friend Lord Dubs put his finger on this—it is a bit of a Cinderella area in the National Health Service. There are several things that the Government could do. The priority of the new national framework for the NHS to tackle avoidable mortality is to be welcomed, but how will the Government commit to explicit inclusion of epilepsy mortality in the outcomes framework? I will refer to epilepsy mortality again in a moment. Will the Minister consider providing a specified neurology lead in each commissioning group? Without that, the Epilepsy Society believes that it will remain a Cinderella service.
On avoidable mortality in epilepsy, the figures bear some exposure. In England and Wales about 22,807 years of life are lost each year through epilepsy. That number of years lost is larger than the years lost by people with asthma. The average number of years of life lost per person is over 30 years. In England and Wales, 11 per cent of all epilepsy-related deaths are in children and young people under the age of 25. The Epilepsy Society believes that these deaths are avoidable.
I happen to know that the Minister shares many of the concerns in this area, because immediately before he was elevated to his present position he was the chair of the All-Party Parliamentary Group on Epilepsy. He addressed a conference in January last year before the general election, which was jointly organised by the Department of Health and the Joint Epilepsy Council. My honourable friend Ann Keen, who was then the Minister, was won over by the case made by these charities. The conference was specifically aimed at NHS commissioners of epilepsy services, and at the end it is reported that the noble Earl who is now the Minister told the commissioners to go away and make a difference. I hope the noble Earl will forgive me if I use his words to urge him to do the same.
I turn to muscular dystrophy, and related neuromuscular conditions, which comprises a group of about 60 different conditions affecting children and adults and can be genetic or acquired. The House has discussed those conditions before, partly as a result of the work of the noble Baroness, Lady Thomas. Recent data suggest that many patients with neuromuscular conditions are being admitted to hospital for emergency treatment but that 37 per cent to 42 per cent of these admissions could have been prevented if the patients had access to the right specialist support. I also received briefing by Professor Mike Hanna. I do not intend to report the case histories that the noble Baroness recounted to the House, but I think that they raise some very important issues, as they illustrate the importance, particularly going back to the Royal College of Physicians’ report, of neurological expertise being available in district general hospitals. That has to be a priority.
Turning to multiple sclerosis, which has also featured in this debate, the Multiple Sclerosis Society has produced an excellent brief about neurological conditions in general and, indeed, about people with MS. As the noble Baroness, Lady Gardner, mentioned, those people with MS rely on a multidisciplinary team of MS nurses, physiotherapists, occupational therapists, psychologists and others to maximise their independence and quality of life. The MS Society legitimately raises some very serious questions about what is proposed in the Health and Social Care Bill. What will happen to commissioning at local level by clinical commissioning groups? It is concerned that many of these groups will cover a relatively small population area, which means that it will not be cost effective to commission services for less common conditions such as MS. The society submitted a response to the Future Forum. The Future Forum itself said that the Bill did not satisfactorily address the concerns that are raised by what is called low-volume commissioning.
Motor neurone disease absolutely amplifies the problems that occur with low-volume commissioning. My understanding is that to commission effectively for a condition such as motor neurone disease, you need a population group of between 2 million and 4 million because it is such a rare disease. This is a point that I have put to the Minister before, but I really fail to see how the architecture being proposed in the Health and Social Care Bill and the way that things are being structured will be able to deliver that effectively. Like the noble Baroness, Lady Hollins, and my noble friend Lord MacKenzie, I fear for the transition as much as I am concerned about the outcomes. It is also unclear as yet what impact the National Health Service reforms will have on MS post nurses. One of the themes that the noble Earl needs to address, which has run throughout this debate, is the importance of specialist nurses for those with neurological conditions.
My noble friend Lady Gale is a great champion for Parkinson's disease. As part of the NHS workforce projects briefing that we received from the Library, page 13 was very interesting. That page shows the complex web of care that is necessary for somebody with Parkinson’s disease, or indeed any of the neurological conditions. The diagram shows that there are at least 20 different people with specialities who are involved in the care of somebody with a neurological condition. Those 20 go from ward hospital staff through voluntary groups to respite care staff, dietician, health visitor, school nurse, if the person is young, and physiotherapist. The person who can co-ordinate those 20 people is of course the specialist nurse who can work with that sufferer and their family.
I should like to return to a theme which I picked up particularly from the comments made by the noble Baroness, Lady Gardner, about integration. My noble friend Lord Dubs and other noble Lords also addressed this issue. Regarding integration and support for people with neurological conditions, we will be debating the Welfare Reform Bill next week in this Chamber but it is difficult to escape from the fact that current government proposals will have a serious impact on people suffering from conditions as complex and fluctuating as motor neurone disease or MS. For example, people receiving contributory employment and support allowance in the work-related activity group will have the payment of their benefit limited to 12 months. We know that many of the 40 per cent of people with MS in this category already face significant barriers to work and a large proportion will not qualify for income-related ESA, leaving them with no financial support. Will the new PIP, referred to by the noble Baroness, Lady Gardner, take proper account of fluctuating conditions? The current proposal not to carry over automatic entitlement to PIP will lead to costly and unnecessary reassessments for those with long-term degenerative conditions, and how much worse will that be in a case like that mentioned by my noble friend Lord MacKenzie—motor neurone disease, which can progress very rapidly?
The range and quality of the briefing that we have all received is testament to the seriousness of the challenges facing those with the many different kinds of neurological disorders mentioned today. I am afraid that the progress made, such as it is, may even now be faltering, stalled or in jeopardy, due to a combination of the reorganisation of the NHS; the loss of posts—for example, specialist nurses; the lack of clarity about who will be responsible for what, particularly during the transition; the cuts to local authority funding; the loss of strategic health authorities to commission the training of those specialising in these conditions; and, indeed, the funding problems of the voluntary organisations that provide support for those with neurological conditions.
I am not surprised that my noble friend Lord Dubs wanted to have this debate. It has been illuminating and important and has outlined a huge challenge for the Minister when he responds.
The Parliamentary Under-Secretary of State, Department of Health (Earl Howe)
My Lords, I thank the noble Lord, Lord Dubs, for tabling this Motion, which has provided for such a richly informative and valuable debate. I know that this subject is close to his heart, as it clearly is to all those who have spoken today. The noble Lord made the observation that neurological conditions have enjoyed an unfairly low public profile, and he is right.
As we have heard from the noble Baroness, Lady Thornton, neurological conditions affect a significant number of people—an estimated 8 million in England. They account for approximately 20 per cent of acute hospital admissions, and are the third most common reason for seeing a GP. We have also heard that, despite the existence of authoritative guidance in the shape of the NSF for long-term conditions and NICE guidance, services continue to fail many people living with a neurological condition.
Change is needed, and through the health reforms currently progressing through this House we want to ensure that we have health outcomes that are among the very best in the world. Effective commissioning is key to delivering high-quality services. Commissioning in the past has been too remote from the patients that it intends to serve. Commissioning decisions made by clinical commissioning groups will be underpinned by clinical insight and knowledge of local healthcare needs.
Our commissioning reforms also recognise the needs of patients for specialised services, with the NHS Commissioning Board commissioning such services in future. Additionally, with low-volume services that fall outside the scope of specialised services, there will be flexibility for commissioning groups to decide how to commission—for example, through collaboration or thorough a lead-commissioner arrangement. Commissioners will need high-quality commissioning support, much of which will come from the voluntary sector. At this point, I join the noble Baroness, Lady Thornton, in acknowledging the work of Neurological Commissioning Support, which is helping to ensure that the real experts—people living with neurological conditions—are at the heart of local decision-making.
Quality standards, developed by NICE, will also be at the heart of the system, providing authoritative statements of high-quality care. They will have real traction within the system, linking with tariffs that will see providers paid more for quality care. Quality standards covering epilepsy services for children and adults have already been referred to NICE for development, and quality standards covering a number of neurological conditions including MS, motor neurone disease and Parkinson’s disease featured in the recent engagement exercise run by the National Quality Board on the proposed areas that will initially make up the library.
The NHS outcomes framework will ensure that commissioners, providers and others are better able to identify those things that can drive up performance in the NHS by providing a focused set of national outcome goals and supporting indicators that patients, the public and Parliament will be able to use to judge the overall progress of the NHS. It will inform the Secretary of State’s mandate to the NHS Commissioning Board and, in turn, to the NHS commissioning framework.
Let me give a few examples of the relevant indicators. In domain 1—preventing people from dying prematurely—the overarching indicator is about mortality from causes considered amenable to healthcare. Epilepsy is one of the conditions where there is room for significant progress. Domain 2—enhancing quality of life for people with long-term conditions—addresses such issues as the proportion of people feeling supported to manage their condition, which is important for people with conditions such as CFS/ME, acquired brain injury, MS and motor neurone disease.
The aim of domain 3—helping people to recover from episodes of ill health or following injury—is to capture information on patients’ journeys through the system. Domain 4—positive experiences of healthcare—will look at such things as patients’ experiences of primary care. Domain 5—treating and caring for people in a safe environment and protecting them from avoidable harm—can, for instance, support better medicines management, which is crucial for people with Parkinson’s disease.
We must also have a much clearer split of responsibility—a sense of joined-up access across the care pathways to deliver a less fragmented and more person-centred approach to planning. Integrated service provision is central to our reform agenda to ensure more joined-up thinking and commissioning on these issues, and one might say that there was never a more relevant area for that than neurological conditions. This is being demonstrated very ably in Nottingham, with its community neurology service, which is providing access to a wide range of professionals—specialist nurses, social workers and allied health professionals—to provide effective support and rehabilitation.
Nursing and the role of specialist nurses has been a strong theme in this afternoon’s debate. The Government recognise the valuable contribution made by nurse specialists. However, it remains our view that local providers must have the freedom to determine their own workforce based on local clinical need. We must remember that commissioners will be commissioning for good outcomes. The commissioning groups, led by clinicians, will recognise that nurse specialists have an essential role in improving outcomes and experiences for patients. Again, Neurological Commissioning Support is already proving a powerful advocate for specialist nurses.
The noble Baroness, Lady Pitkeathley, stressed the role of social care. As she knows, we have set out a broad agenda for reform in social care. We want to see care that is personalised; offers people choice in how their care needs are met; supports carers; has a skilled workforce who provide care and support with compassion and imagination; and offers people the assurances they expect of high-quality care and protection against poor standards and abuse. We have been working with stakeholders to look at the fundamental issues for reform in social care, such as improving quality, developing and assuring the care market, integration with the NHS and wider services, and personalisation.
I turn to some of the questions that were posed in this debate. I suspect that there were rather too many for me to answer now. I will, of course, happily follow them up in writing. The noble Lord, Lord Dubs, set us thinking about how clinical advice will be infused into the NHS. He asked whether there would be a lead for neurological conditions in the department and a long-term conditions strategy. The NHS Commissioning Board will determine the clinical advice and leadership to support the five domains of the outcomes framework to which I referred. That, of course, includes long-term conditions. A long-term conditions strategy is in development. It is in its early stages but it will certainly seek to address a wide range of long-term conditions, including neurological conditions.
The noble Lord asked about a national strategy for neurology. We have approached the task of driving up quality from a different angle. NICE quality standards will be commissioned, and I have already mentioned some of them. The NHS Commissioning Board will be tasked with issuing commissioning guidance based on those standards. Local commissioning to meet the needs of the community will address the domains in the outcomes framework. Health and well-being boards will conduct joint strategic needs assessments and produce health and well-being strategies to make sure that the needs of patients are properly prioritised. Local healthwatch and HealthWatch England will be the patients’ watchdogs and the local and national voices speaking up for patients.
Commissioning by clinical commissioning groups does not mean that individual groups will have to commission every service. They can commission collaboratively, as I have mentioned, if that makes sense for them. Commissioners will be supported by clinical networks advising on single areas of care, and the new clinical senates in each area of the country will provide multiprofessional advice on local commissioning plans.
As regards having an advisory group for neurological conditions within the Commissioning Board, we understand that the board will put in place arrangements for clinical advice. One of the domains in the outcomes framework is concerned with the management of long-term conditions, and it would be natural for the board to reflect that in its structure. As regards a national clinical director for neurology, that will be a decision for the board, but it shares my desire for continuity and for ongoing improvements in the care and support of those living with these conditions.
The noble Baroness, Lady Gale, mentioned the value of clinical audits. I agree with her that they are of considerable value and my department regularly reviews the programme, within what we call HQIP. More than one noble Lord, including the noble Lord, Lord Dubs, and the noble Baroness, Lady Thornton, spoke about the number of neurologists, which is of course important in these complex and specialised areas. At the time of the last NHS workforce census in September 2010, there were 1,139 neurologists and 650 neurosurgeons employed in the NHS in England. To better understand the future demand for medical staff and to develop supply strategies to meet this demand, the Centre for Workforce Intelligence provides an assessment of medical supply and demand by specialty, region and care pathway. In August 2011, the centre published its second report on the medical workforce, which included a series of factsheets for each medical specialty, including neurology.
As we hope and expect from her, the noble Baroness, Lady Pitkeathley, rightly praised the role of carers. As I hope she knows, the Government are committed to supporting carers, who have a higher profile than ever before. We set out our priorities for action over four years, focusing on what will have the biggest impact on carers’ lives, in our document Recognised, Valued and Supported: Next Steps for the Carers Strategy, published just over a year ago. We are currently considering what more we can do for carers in the light of the recommendations made by the Dilnot commission on the funding of care and support, and by the Law Commission on the reform of adult social care. We will set out our full proposals for reform of adult social care in the White Paper in the spring.
As regards continued financial support for carers, we recognise the factors that the noble Baroness mentioned about rising costs of living. This again was a subject that we covered in our carers’ strategy last year. We reinforced some key messages in the NHS operating framework for next year. That reaffirms our commitment to supporting carers, including setting out specific requirements for PCT clusters to plan to support carers. The Government have set out further guidance to PCTs on funding carers’ breaks. The information available to carers is also important, as the noble Baroness emphasised, and the gateway for this is through primary care and the strategy. It is emphasised that primary care should support people who are carers or who fulfil that role, even if they do not identify themselves as such. On the Dilnot report, which we debated at some length, the noble Baroness knows that our engagement exercise to inform the future of social care has just ended. That has been extremely valuable. We will continue to work with leaders from the sector to develop policy proposals for the White Paper.
My noble friend Lady Gardner, the noble Lord, Lord Monks, and others spoke about multiple sclerosis and improving the quality of care for those patients. NICE routinely reviews its published guidance to take account of new evidence. Following consultation with stakeholders, NICE announced on 22 June that it plans to update its clinical guidelines. The review will consider new evidence identified in a number of areas which may change NICE’s current recommendations on the diagnosis and management of MS. I do not have a date, because NICE has not yet confirmed when it expects to issue the updated guidance.
The noble Lord, Lord Monks, asked about treatments. Although we strive to ensure that there is national guidance on the most commonly used medicines and treatments, there will always be instances where decisions have to be made locally. Under the NHS Constitution, patients have the right to expect local decisions on the funding of medicines and treatments to be made rationally, following proper consideration of the evidence. In the case of treatments which are not covered by NICE guidance, the local PCT has to decide whether to fund the treatment, based on an assessment of the available evidence and the patients' circumstances.
The noble Lord referred to Professor Richard's report on the extent and causes of international variations in drug usage. That was an extremely informative exercise. The report outlines a number of explanations for low uptake of certain medicines in this country. One was caution and/or scepticism among some neurologists about the benefits of treatment, including long-term effectiveness and concerns about side-effects, which we should not forget. There is also the fact that guidelines on the use of MS treatments are stricter in the UK than in some other countries—for example, the criteria in other countries for the use of disease-modifying therapies are lower. Those are very expensive treatments and we need to ensure that they are used only when they will achieve real clinical benefit. That is why we rely on NICE for its advice.
The noble Lord, Lord Dubs, mentioned Tysabri. That drug has received a positive recommendation from NICE; therefore, the NHS is required to fund treatment for patients whose clinicians consider they should receive that drug and are within the terms of NICE’s recommendation. If it does not fund it, the department expects the relevant strategic health authority to ensure that action is taken.
The noble Lord, Lord Monks, referred to a new drug called Fingolimod. I understand that NICE is currently appraising use of that drug in treatment of relapsing remitting MS and issued draft guidance on 5 August which does not recommend the drug's use. Since then, the manufacturer has proposed a patient access scheme for the drug, and we have agreed that that can be considered as part of NICE’s appraisal.
I have some lines here on stem cell treatments, which the noble Lord, Lord Dubs, mentioned, but I will write to him on that issue, in the interests of time. The noble Baroness, Lady Masham, and the noble Lord, Lord MacKenzie, referred to the especially distressing condition of motor neurone disease. A standard for motor neurone disease was part of the engagement consultation exercise run by the National Quality Board on the proposed areas that will make up the library of standards.
End-of-life care has featured in the debate—quite rightly. We recognise the need to ensure that the care that people receive at the end of life is compassionate, appropriate and supports the exercise of choice by care users. We confirmed our commitment to improving quality and choice in palliative and end-of-life care in the White Paper published in July last year.
We made a commitment in Liberating the NHS: Greater Choice and Control to move towards a national choice offer to support people’s preferences about how to have a good death. We have emphasised that access to good quality palliative care should not be confined to diseases such as cancer. The end-of-life strategy aims to improve care for all people approaching the end of life and includes people with advanced, progressive illness and the care given to them in all settings.
The noble Baroness, Lady Thornton, spoke about epilepsy. Here, the long-term conditions delivery support team developed a resource pack for the commissioners that brings together relevant documents and information from a variety of sources to support the development of epilepsy services. This includes information for commissioners on avoidable epilepsy-related death, which has been provided by Epilepsy Bereaved, the leading voluntary organisation in the UK working to prevent SUDEP. The NHS outcomes framework offers a number of opportunities for improvements at this area.
Spinal injury was a theme taken up by the noble Baronesses, Lady Hollins and Lady Masham. As they know, eight centres in England provide specialised care and treatment for patients with spinal cord injuries. I agree with the noble Baroness, Lady Hollins, that these centres have a key role, not only in acute care, but throughout the lives of paraplegic and tetraplegic patients.
There are no plans to establish any further specialised centres at this stage. It is currently the responsibility of regional commissioners and the individual centres to ensure that they are able to meet the needs of the populations that they serve.
I will need to write to noble Lords on continuing care, which is another subject that has arisen. I acknowledge that this is a source of concern, but the issue is quite complex. In the present system, eligibility for NHS continuing health care is determined based on individual assessment of need; it is not condition-based. There is a single national framework for determining eligibility but, as I say, this is a subject on which I shall write.
The noble Baronesses, Lady Hollins and Lady Masham, and the noble Lord, Lord MacKenzie of Culkein, spoke about the poor quality of wheelchair services. They are correct, which is why we believe that commissioners should be free to identify where choice and competition could have a role in improving services for patients. It is one of the services selected for Any Qualified Provider. I say to the noble Lord, Lord MacKenzie, that this is a good example of where third-sector organisations and social enterprises could make a real difference. We want to encourage that.
Time has moved against me, despite the fact that I have much more to say. I thank all noble Lords who have spoken. I undertake to follow up all the issues that I have not been able to cover; in particular, I am conscious that I have not addressed the pertinent issues raised by the noble Lord, Lord Macdonald, about dystonia but I shall do so in writing. With that, I thank all noble Lords for what has been a richly interesting and informative debate.
Lord Dubs
My Lords, I thank all noble Lords who have contributed to the debate. I was very impressed by the level of commitment, knowledge and professionalism that was shown by everybody who spoke. I have certainly learnt a lot, although I did a lot of homework before the debate began.
I thank the Minister for a very thoughtful reply; I am not saying that I agree with every word of it. I know that he has been extremely busy almost every day of the week, so I am particularly grateful that he found the time to give us his response to the thoughts that were put forward.
It would be wrong to go into things in detail, but I will pick up one issue: that of nursing. There were many important issues, but it seems to me that the common comment on nursing made by almost everybody was the important part that specialist nurses play in helping and supporting people with neurological conditions. Allied to that was the comment that nurses probably save the rest of the health service quite a lot of money. Perhaps I should not enter a new thought into the debate when I am just saying thank you to people, but I make a plea to the Minister to assess whether more nursing support would not actually be beneficial to the health service in financial terms as well as enormously helpful to the very vulnerable people on whose behalf we have been debating today.
Citizens Advice Bureaux
Lord Boateng
To ask Her Majesty’s Government what plans they have to secure the future of Citizens Advice Bureaux in the Big Society, in the light of the reductions in funding.
Lord Boateng
My Lords, I welcome the opportunity to initiate this short debate on the question of how Her Majesty’s Government plan to secure the future of the citizens advice bureaux in the big society, in the light of reductions in funding.
The quality and breadth of interest across parties in this subject, represented so late on a Thursday afternoon in this House, is indicative of the breadth of support and appreciation that the CAB movement has engendered through its activities across the country.
The Prime Minister has described CABs as “fantastic”. When asked, at the very outset of his introduction of the concept of the big society, how he would best exemplify it, the example he gave was of the citizens advice bureau movement. I believe that was an apposite example.
Let me declare my interest at the outset. I had my first job as a qualified solicitor working as a citizens advice bureau lawyer. I will in due course, no doubt, be in receipt of a modest pension from the Greater London citizens advice bureau movement, so I should declare that at the outset. What I learnt from my time as a CAB lawyer, and subsequently when seeking to serve my constituents in the other place, is that the CAB movement makes a real contribution to community cohesion, and access to rights and benefits. Importantly, it brings together voluntary activity in local communities, rural and urban, in ways that enhance the whole community through access to justice, knowledge and information. Importantly, it also saves the state a very great deal of money. That is why this debate, and the question raised with the Government, are of significance: because of the current crisis in funding that is affecting the CAB movement.
The scale of that crisis was indicated by the chief executive of Citizens Advice, Gillian Guy, to the Public Accounts Committee, when she gave evidence in the course of its inquiry. She said that it was not just an issue of local government funding, important though that was, because without local government funding there is not the core funding that allows CABs to do what they do in the local community. The cuts in local government funding, she revealed, generally average about 10 per cent. That, by itself, would be bad enough, except that those figures mask the considerable range in the impact of those cuts. Some bureaux will lose between 60 per cent to 100 per cent of their entire local government funding.
As Gillian Guy pointed out, other bureaux, where the local authority has recognised the very real contribution that local CABs make to the delivery of their services and have left their funding intact, will face a crisis because 25 per cent of some of their funding comes from the legal aid fund. As noble Lords well know, legislation currently going through this House and through the other place will effectively bring an end to that funding, so that bureaux will lose an additional £20 million of funding as a result.
Why am I, a former Chief Secretary to the Treasury, urging more public expenditure in this area? It reminds me of the pieces that appear from time to time in a certain sort of newspaper in which an alcoholic recommends temperance. I have not suddenly undergone a conversion to the joys of public spending, but the figures reveal the startling savings to the public purse that come from expenditure on advice. For example, every pound spent on housing advice potentially saves £2.34; every pound spent on debt advice could save £2.98; every pound spent on benefits advice potentially saves £8.80; and every pound spent on employment advice can save the state £7.13. CABs offer real value for money. That is why we should view the current crisis in the funding of the CAB movement as a matter that requires urgent attention from the Government.
One recognises that the Government have taken some steps, which are welcome, to bridge the funding gap. However, we should be clear about what the steps are. They all represent transitional funding. There is no offer of sustainable funding beyond the period covered by the transitional funding. I fear that the result will be a degree of uncertainty affecting the CAB movement that will make it impossible to plan for the future. People who provide real, important and significant services to local communities are now faced with redundancy. The Government have announced a review of government funding of advice, led by the Cabinet Office, and that is welcome. Of course, the CAB movement will contribute to that review, but the concern is that it should be a comprehensive piece of work that will look right across government for input. There is also concern that all those with an interest in advice provision should be engaged in the review; that we should look not for top-down models of funding advice centres—because all experience shows that they tend not to work—but for a means of funding that will allow local communities to set priorities, with funding mechanisms that are able to meet those priorities; and that any conclusions of the review should be fully funded. If they are not, I fear that the future of CABs will be bleak indeed.
I end by suggesting that we look at the communities we know best. My local CAB in Brent is faced with the reality of these cuts. What sort of clients will find themselves most affected? Brent CAB gave the example of a disabled mother who as a result of the advice that she was given on the warm home discount scheme is now able to obtain a £120 discount on her electricity Bill; and of a disabled elderly client who needed to replace her worn-out boiler and restore some warmth to her home. She was not aware of her rights or of how Carillion had failed her. As a result of the CAB she became aware of her rights and this winter she will live in a warm home.
CABs are about enabling communities. They are about enhancing lives. They do so in cost-effective ways. They involve highly skilled and qualified volunteers who require organisation and training, which costs £1,600 but produces a benefit to the community that is so much greater than that. All that requires core funding and access not just for generalist but for specialist advice, and it has to be funded.
I ask that the Government produce a joined-up approach to this, that the review be comprehensive and that we go to the Treasury to seek that that review’s outcomes are fully funded. Then we really will have a contribution made by CABs to a big society that is more than just a form of words.
Lord Newton of Braintree
My Lords, the noble Lord has confirmed the view I have always held that in every Chief Secretary there is a warm-hearted person trying to get out. It has come out this afternoon in a debate in which I judge the noble Lord has done the House a service, and I congratulate him on that.
I have never seen a speakers list that is a better list for the Whips’ Offices, particularly for the Conservative Whips’ Office, of the usual suspects—that is excluding the right reverend Prelate, of course—so there is some interest in this. I have a little history on this, so I can hardly avoid being a usual suspect. I go back a long way. In the early 1960s, as a rookie in the Conservative research department, I worked with the late Lord Barber to produce a pamphlet on consumer protection that drew attention to the parlous state of citizens advice bureaux and the desirability from the point of view of the Government of encouraging and fostering them. Happily, that has happened, and the movement has grown significantly in the intervening period.
Lord Phillips of Sudbury
Does my noble friend Lord Newton remember—I nearly said “the late lamented”—Mr Vaughan, who I seem to remember attempted, as a Conservative Minister, to make massive cuts in the CAB and lost the argument and his position as a result?
Lord Newton of Braintree
I have some recollection of that, but I do not want to go into other people’s grief on this occasion. However, I am pleased to take the intervention from my former constituent, my noble friend Lord Phillips of Sudbury.
I was involved with that pamphlet, and later, as a junior DHSS Minister, I remember a lot of contact with CABs. I used to go back to the department and say, “Why are our leaflets so much worse than theirs?”. Our explanatory leaflets were not good, but we got better at them. Of course, I had a lot of contact with local CABs in Braintree and Witham.
The noble Lord made one of the key points, which is that CABs were the big society in action before the phrase was ever invented. We need to bear that in mind in talking about CABs tonight. The fact is that if citizens advice bureaux did not exist, the Government would have to invent them against the background we have at the moment. In my judgment, at present that need is not diminishing but growing. I do not dispute the need for difficult decisions about public expenditure or the fact that they are going to cause pain to some degree for everybody because of the situation we are in, and I am not seeking to debate the priorities, although I have doubts in one or two areas. That is not today’s subject. The fact is that a lot of relatively poor, relatively vulnerable people will be and are being affected by these changes. They are affected by changes in the Welfare Reform Bill, the Localism Act and, not least, the Legal Aid, Sentencing and Punishment of Offenders Bill, which we are about to go into detail on.
I am not going to go on much longer, but I have one letter from the Cambridge CAB, which is a page and a half long. I will quote three or four sentences. Sentence one:
“We have already had to withdraw desperately needed specialist help to people with mental health problems because of the loss of County funding”.
Sentence two:
“As you know, many CABx are already in the situation where they cannot afford to keep going”.
The last two sentences:
“You have probably seen much evidence from Citizens Advice and individual CABx about our role as Legal Aid advisers. The proposed scrapping of most of the Legal Aid budget next year will result in the loss of most of our specialist debt, benefit and housing advisers”.
Those words would be echoed by a lot of others, including law centres such as the Mary Ward Legal Centre in Camden.
I ask my noble friend not to give us all the answers this afternoon, but to take account of the fact that there is real concern here, real need, and to respond in as constructive a way as possible.
Lord Thomas of Gresford
My Lords, I congratulate the noble Lord, Lord Boateng, on bringing forward this very important subject, which I am sure is going to be the subject of debates on the Legal Aid, Sentencing and Punishment of Offenders Bill that is shortly to be dissected in Committee.
The English and Welsh Civil and Social Justice Panel Survey: Wave 1, a report published this year by the Legal Services Commission and Ipsos MORI, under the auspices of the Ministry of Justice itself, starts with this arresting paragraph:
“We live in a ‘law-thick’ world, where the ability of people to make use of the law to protect their legal rights and hold others to their legal responsibilities underpins the rule of law, ensures social justice and helps address the problems of social exclusion”.
The key words in that passage are,
“the ability of people to make use of the law”.
The network of 394 independent advice centres manned by Citizens Advice has been critical in enabling the ordinary citizen to claim and protect the rights that have been granted to him by successive Governments in the name of social justice. Sixty-four per cent of its 28,000 staff are volunteers, the annual value of whose contribution to the work of the citizens advice bureaux—were they paid—has been estimated at £106 million.
I cannot match the hands-on experience of the CAB of the noble Lord, Lord Boateng, but when I was a young solicitor in north-east Wales, I would meet, day by day, people with a problem or a multitude of problems. The individual client would come into the office with a black cloud of worry around his or her head; he or she had no idea of what to do, where to go, or how to disperse that cloud. My very first task was to listen; then to put a shape upon that cloud to reduce it into concrete issues; to apply the law to those issues; and, finally, to advise in a way that the client could understand.
I recall later at the Bar taking one case involving a special hardship allowance and another involving war pensions to the Divisional Court to obtain a writs of certiorari, as judicial review was then called. It was all pro bono work. No fees were charged and it was not on legal aid, but it was excellent experience to appear against the noble and learned Lord, Lord Woolf, then the “Treasury Devil”. Modesty forbids me to say who won in those cases. No one could support a wife and family on pro bono work and it could be only an occasional adjunct to a personal injury and criminal practice.
For many years, lawyers in private practice have, to a very large extent, left welfare law in the areas of housing, debt and benefits to the CAB and to law centres and other voluntary agencies. The advice that is offered by the CAB is in two broad categories: generalist and specialist. Generalist advice does not need legal training, and deals with the provision of basic information, signposting, assistance with form-filling and the like. Of course, training is given by the CAB to its generalist advisers accordingly. But the specialist advisers, the paid staff, provide legal help and are mostly legally qualified. Because they do, the bureau where they are employed holds legal aid contracts from the Legal Services Commission, which provides an income of £28.4 million annually.
Under the Legal Aid, Sentencing and Punishment of Offenders Bill going through the House, the Ministry of Justice projects a reduction of legal help for welfare benefits advice of 100 per cent, debt advice of 74 per cent, housing advice of 40 per cent and employment advice of 78 per cent. Will that result in savings of government expenditure overall? I very much doubt it. Removing legal aid contracts from the citizens advice bureaux will leave such a large hole in their finances that they can survive only as generalist advisers relying on voluntary assistance. The specialists will be declared redundant, as the noble Lord, Lord Boateng, pointed out, at considerable cost and no doubt they will use their legal expertise in more profitable employment. Generalists will be forced to say to their clients, “You need specialist advice on that particular issue. It needs a lawyer to look at it”. But where will that advice be found? It will certainly not be at high street solicitors firms, nor in the law centres, which will be even more severely hit by this Bill.
The Ministry of Justice’s own research demonstrates that problems in these areas do not arise singly but in clusters, including the family cluster. I quote from the Wave 1 report, which states that,
“family problems (comprised of domestic violence, divorce and relationship breakdown problems) cluster together strongly … 39% of those who reported suffering from domestic violence in the 2010 survey also reported problems ancillary to relationship breakdown, and 9% reported a divorce. Likewise, 22% of those who reported problems ancillary to relationship breakdown also reported a divorce, and 19% suffer from domestic violence”.
All these things are interrelated and it is even more obvious when you come to the economic clusters. The report states:
“The 2010 survey also re-confirmed the existence of a second cluster incorporating problems linking to economic activity: consumer, money, debt, employment, welfare benefits, personal injury and neighbours problems”.
For example,
“23% of those who reported having employment problems also had consumer problems, 16% had money problems, 16% had debt problems, and 19% had problems with neighbours”.
It is all linked together.
The findings of that report relating to the respondents’ knowledge of their rights is also compelling. Only 22.6 per cent felt that they knew their legal rights when the problem started; 18.2 per cent said that they mostly understood; 20.3 per cent partly understood; and 35 per cent did not understand their rights at all. Those are statistics, and I am grateful to the noble Lord, Lord Boateng, for bringing an illustration of reality from his own area to those statistics.
What will be the result of the departure of specialists from the CAB? First, advice to the aggrieved client that he has no case will no longer be given, which means that the cases taken forward will be more numerous but less meritorious. Secondly, the informal settling of cases will disappear—that is, the telephone call between the citizens advice bureau adviser and the government agency to sort out mistakes and so on. Thirdly, the applicant’s case, if it goes to a tribunal, will not be in a presentable form. If the case is well-ordered and the necessary evidence has been gathered together, the tribunal can deal with an appellant in person. But if he turns up with that black cloud around him, it will be for the tribunal to spend hours sorting out that problem and not being able to come to the issue straight away in the way that it should happen.
With the cuts being proposed, the CAB will become the most vital of all the agencies that prevent social exclusion. So the question for the Minister is this: where is the funding for the specialist advisers of the CAB going to come from when those legal aid contracts disappear? I cannot believe it is the policy of the Government to make it so much more difficult for applicants to present their case that they give up, as the Wave 1 demonstrates so many of them do without help. That will be nothing to do with saving money and reducing the deficit; it will simply be a disgrace.
The Lord Bishop of Newcastle
My Lords, I too am grateful to the noble Lord for securing this debate today. The future of the CAB is a hugely important matter, and I want to begin by paying tribute to the enormous contribution the CAB makes to the well-being of our society. It provides a lifeline for over 2 million people a year, but the position is becoming desperate. As we have heard, some CABs have had more than 50 per cent of their funding withdrawn. They are cutting their opening hours, cutting services and making staff redundant. Some are facing closure and shutting down altogether. To make matters worse, the coming changes in the legal aid system mean that social welfare and housing cases will no longer be eligible for legal aid, so the funding crisis for the CAB is bound to get worse and worse. And all of that is happening as the number of people seeking help with debts, benefits and homelessness has doubled in some parts of the country.
There is a triple whammy going on: local authority cuts, the end of the Financial Inclusion Fund, and the cuts to legal aid. Inevitably, it is the poorest in our society who will suffer the most. People are already struggling with the impact of job losses—that is especially true in my part of the world, the north-east—reductions in public services, rising costs of living and increasing levels of debt. The CAB network has always prided itself on being there for the people who need its services the most, but it will no longer be able to be the lifeline that so many need, and more people will have nowhere to turn when they desperately need help with their own serious problems. The irony of it is, if irony is the word, that as a volunteer-based service, the CAB provides excellent value for money and—I argue as the noble Lord, Lord Boateng, did—saves public money in the long run. It is almost as if we are cutting off our nose to spite our face. When CABs are forced to reduce their services, they lose highly skilled and dedicated volunteers and staff. That is a tragic waste and surely a false economy.
My personal experience comes from the city of Newcastle and the county of Northumberland, and it is on the latter that I want to focus the rest of my remarks. Those noble Lords who know Northumberland will know that it is a wonderfully wild, beautiful and very sparsely populated place. There are few, if any, sources of free advice, and for many people the local CAB is not just the first port of call, it is the only place where they can get free, high-quality advice. In rural counties like Northumberland, specialist advice services are few and far between and, as budgets reduce, specialist advisers are finding it harder to travel out to rural outreach centres, some of which have been successfully placed in churches and local village community halls.
Inevitably perhaps, and increasingly, new technology is being considered in order to help improve access to advice. But the trouble is that while the provision of advice by e-mail or through online websites is sometimes a realistic solution, in many parts of Northumberland people cannot even get a mobile phone signal let alone access the internet, and some of the problems people are facing are far more complex than can be dealt with in a quick e-mail. The manager of the citizens advice bureau in Alnwick said this to me:
“The trouble is that assumptions are often made that deprivation does not exist in rural areas, but our experience says otherwise. Unemployment, low pay, part-time seasonal work, limited access to childcare, poor transport links, an ageing population and the low take-up of benefits are just some of the factors which contribute to rural deprivation here. But because the numbers affected are small and scattered, or because deprivation is hidden, it is harder for rural CABs to evidence the need for services to tackle these issues”.
What is true of Northumberland is equally true of many of the more deeply rural parts of our country.
In our present financial climate, it is vital that people continue to have access to debt and welfare advice. I look forward to hearing from the Minister not only how much the work of the CAB is valued by our Government but, much more importantly, how the present insecurity and uncertainty, which are so debilitating for everybody connected with the CAB, can be ended by government action and thereby how the future of the vital CAB services in our country can be secured.
Baroness Gardner of Parkes
I congratulate the noble Lord, Lord Boateng, on initiating this debate, which is very timely. I declare an interest in that my daughter is a representative councillor on the management committee of her area CAB. It is not a financial interest. I also quote a statement by Ed Davey, the Minister for Employment Relations, Consumer and Postal Affairs:
“The Citizens Advice service is a respected brand served by a network of volunteers whom people really trust. In many ways, they are one of the best examples of the Big Society in action”.
That surely indicates that the CAB means a lot to our Government.
I spoke earlier today to a friend who works on a voluntary basis as a solicitor—I was going to say “a young solicitor”, but she has been around longer than I realise, as we are all growing older. She devotes many hours a week to employment issues, which is her field. She said that a difficulty that comes up all the time is a lack of communication and that people often say to her, “You are the first person who has ever actually listened to what I have got to say”. She said that she has had cases where a Filipino woman would be working for a Nigerian man and there was really no issue in it at all; it was simply that they did not understand one another. Each had broken English, but the English had broken in different ways. Therefore, there was no common language between them. That reminds me of how important it is that the Government make knowledge of English language an important feature of life in this country, because it is terribly hard otherwise, unless you are an old lady or an old gentleman whose family looks after everything for you, to participate fully in life. To do that, you really have to have a working knowledge of English as it is spoken today. English is a living language and constantly changing; therefore it is very important that people know what it is about.
The level of professional help and courtesy in the CAB is very high. The Kensington and Chelsea Citizens Advice Bureau service was one of the first branches to open, in September 1939 at the outbreak of war. More than 97 per cent of people have heard of the CAB and 40 per cent have used it at some stage. The total can be counted in millions. At every level, the work represents cost savings to other service providers. That point is highly relevant. In our previous debate on the health service, it was pointed out how so many of the specialist nurses and services save the National Health Service money. I believe that the CAB, too, saves rather than costs money. We tend to look at these things in a slightly short-sighted way.
The two branches of the bureau in Kensington and Chelsea benefit from more than 330 hours a week of volunteer input. It is not easy to get people to give up time now. Even my friend who volunteers a large part of her week said that, as times get harder, it becomes increasingly difficult for her to give up professional time to be there, but we are lucky that she is still doing it.
The London School of Economics found for the Department of Health that face-to-face debt advice was a cost-effective intervention, not only in preventing anxiety and depression but with a return of £3.55 for every £1 invested. The statistics show that the greatest number of people presenting to the CAB now are coming with cases about welfare or debt. That reflects the worrying financial times that we are all facing. When we hear on the radio about people falling into the hands of loan sharks, that is cause for worry. Citizens Advice must prevent many of those disasters from happening by giving people better advice.
Certainly, unemployment is growing. My informant told me that the number of people coming for unemployment advice is rising to new levels. People who did not need help before need help now. It is widespread. Some 76 per cent of people trust Citizens Advice to provide free advice that is truly independent and impartial.
So many things could be said in favour of Citizens Advice, but I have one final point about prevention. The CAB solves many cases, but there is no estimate of the thousands of cases in which Citizens Advice has prevented the need for legal or other action. That is an uncosted value that should be taken into account. I do hope that the Government will take this message on board.
Lord Bach
My Lords, I congratulate my noble friend Lord Boateng on securing this important debate. As the noble Baroness, Lady Gardner, said, the debate is extremely timely for a number of reasons. We have had some excellent speeches which I know the Minister will have listened to with care.
For my own part, I cannot help feeling a little sorry for the Minister tonight. She has to answer this debate although her department has at least tried in some ways to assist the CAB at this difficult time, whereas the Ministry of Justice has, frankly, done the exact opposite. In their legal aid Bill proposals, the Government are planning, as we have heard, to legislate to stop CABs performing a crucial part of their work, namely to give early, specialist legal advice to those who need it. However, it is the Minister who will have to answer this debate on behalf of the Government.
The likely effects of the MoJ proposals are, first and most importantly, that people will not get the advice that they need and deserve. Secondly, some CABs will actually have to close down and others will be put under severe pressure. Thirdly, as the noble Lord, Lord Thomas of Gresford, said, up to 500 specialist staff who are currently employed will either have to find other jobs or be made redundant, with costs attached. What a crazy, nonsensical policy it must be if those are the likely effects of that part of the Bill coming into effect.
Some 20 years ago, it was in my honour to be chairman for a three-year period of a small local CAB, Lutterworth and District. Both then and right through the intervening years, one fact has remained constant—CABs are hugely popular. They are, as we have heard, both trusted and respected, and they are clearly needed by the British people. Any organisation that can give help in one year to more than 2 million people with more than 7 million problems, as was the case in 2010-11, is bound to be popular and respected. However, it is much more than that. It is a feeling that part of what makes it great to be British and us proud of our way of life is that we live in a society where there are efficient and successful institutions that provide help to people in dealing with the law of everyday life—with the law-thick world that the noble Lord, Lord Thomas of Gresford, talked about, dealing with the bureaucracy, delays and legal wrongs that exist in a complex modern society. There are other fine organisations too—law centres, advice centres, many charities, and voluntary and religious organisations as well—but in my view, none has a greater resonance with the British people than the CAB movement.
We all agree that our economic situation is such that savings have to be made. Legal aid must take its share too. However, to say that does not excuse us from looking at where those cuts or savings have to be made. We live at a time—as we have heard, not least from the right reverend Prelate—of falling living standards and the risk of more unemployment; a time, in short, when ordinary people are more greatly in debt and there is greater evidence of renting rather than home owning. Ordinary people more than ever need the help that CABs, along with other organisations, can deliver. People need early legal advice and access to justice more than ever. However, this is precisely the time when the Government have chosen to cut 10 per cent off the very low fees paid for the social welfare law cases which CABs do. They intend to make much greater cuts in the Bill going through this House at the moment. The proposals will mean that the legal aid income of CABs will be reduced from £28.4 million this year to something like £5.4 million once the proposals are in effect. That is a massive difference in the amount of money going to CABs and the number of cases that CABs can take on.
At the moment, 500 CAB special advisers deal each year with over 52,500 welfare benefit cases or problems, over 63,000 debt problems, nearly 16,000 housing problems and up to 3.3 million employment problems. With these massive cuts, they will hardly be able to touch anywhere near those figures. Even if all this was justified and had to be done—we argue that it is certainly immoral and an attack on access to justice—it would still be an absurd policy for the very reason that noble Lords have already stated: it is bound to cost much more than the savings which the MoJ might make. People who cannot get early help will of course find that, in some cases, their problems get worse. The noble Baroness, Lady Gardner, said that a moment ago. The state will have to come in at some stage—there will be re-housing, extra benefits and the state will have to pick up the pieces. We will all have to pick up the pieces. While the MoJ may save a few million quid, the rest of us will be spending much more.
It is good that there is a review, which my noble friend mentioned. However, I have to say that early reports of it are not encouraging and I ask the Minister if she will tell us a bit about it. As I understand it, the review is the modern equivalent of what used to be described as two men and a dog—in this case, two civil servants doing the review on their own. It has to finish by the end of January, which seems remarkably quick. I am delighted that they have been to Coventry Law Centre, which works very closely with the CAB in that great city. But is this a serious review that is really going to look at the future of this crucial part of our justice system?
The CABs would ask us to say that their clients, who are infinitely more important than anybody else, will be the most important people to suffer. But the Citizens Advice Bureaux themselves will suffer; they will have to make people redundant, including a lot of special advisers who will have to make up the 15 per cent shortfall that taking away legal aid from them will mean and who will no longer be viable.
If CABs fail or become half as useful as they are at present, we as a country fail too. What sort of country do you become if the poor and vulnerable—in fact, if any citizen—cannot get help for their legal problems? We are at great risk of allowing that to happen, as it were, quietly, so before we know where we are that is the kind of country we are.
Lord Phillips of Sudbury
I thank the noble Lord, Lord Boateng, for initiating this debate, and as others have said I commend those who have spoken and look forward to those who have still to speak. The noble Lord rightly said that we must have a joined-up review. I think that that is crucial. The noble Lord, Lord Newton, said: “If CABs didn’t exist, government would have to invent them”. That is a sentence that my noble friend of 20 years has taken straight out of my script.
My noble friend Lord Thomas stated a key statistic—that 35 per cent of those going to CABs are totally unaware and lacking in understanding of the legal problems surrounding them. The right reverend Prelate the Bishop of Newcastle talked, rightly, of rural poverty. The noble Baroness, Lady Gardner of Parkes, said that 98 per cent of the population have heard of CABs. Is there another institution in our entire society of which that is true?
Lord Phillips of Sudbury
Yes. Then the noble Lord, Lord Bach, himself came out with that striking statistic that civil legal aid will drop for the CABs from £28 million to £5 million if the cuts go ahead as planned.
I state my own interest in CABs, in that I was for two decades solicitor to what was the National Association of Citizens Advice Bureaux, and my firm still does a lot of work for it. I also acknowledge instantly to my noble friend the Minister that this must be a very difficult debate to respond to, because we are all on the one side and passionately so and will not be put off, and she has to answer this.
Of course, as a coalition Government we have had to do very unpopular things and all parts of public expenditure have been hit. The general message tonight is clear—that this is a false economy that we are engaged upon. It is manifestly clear to anybody who has had anything to do with the CAB movement that what it does is—as one noble Lord said—to prevent much greater problems downstream. We have had various statistics quoted as to how much is saved by £1 that is spent via the CAB. I heard a figure of £9 being saved downstream for every £1 saved upstream in equipping CAB advisers to help people with debt. What greater problem is going to confront us in the next two or three years than debt? None, I suggest. How parlous are the circumstances of people trammelled in debt? As the noble Baroness, Lady Gardner, said, they have loan sharks swimming all around them. I have to be honest that it is a mystery, even with the intense difficulties of running a budget in these times, as to why we are cutting the bone—this is not the flesh, it is the bone of citizens advice.
CABs are in a way a national legal service. They are the nearest thing that we have to the NHS. It is interesting to remember that the first legal aid Act in 1949 had a provision in it allowing for the establishment across the countries of advice centres. The reason why that was not implemented was that the CAB movement took wing after the Second World War and it was instantly clear that they would provide all over the country the sort of citizen help that could have been provided at vastly more expense, with vastly more bureaucracy by the state, under the 1949 Act.
I feel compelled to say that there is a sort of cynicism, wholly unintentional but none the less real, about this Parliament which legislates as if there is no tomorrow. I looked up a statistic before I came here—in 2007 and 2008, we legislated 28,773 pages of new statute law. That is an average for each year of 14,386 pages, and that is without the circulars and all the rest that comes in the wake. That affects citizens of all sorts and all conditions, and one of the interesting phenomena of the development of the CAB movement has been that it is no longer just for the poor and deeply disadvantaged. More and more of our fellow citizens have to resort to the CABs to get advice on increasingly complicated legal jungles—quite as complex, I may say, as the tax system.
The big society point that has been made by so many noble Lords needs emphasising. If the Government are serious about the big society, and they are, then there is no more powerful manifestation of it than the typical CAB. It is not just about the nearly 400 full-time CABs; there are 3,300 part-time CABs operating from doctors’ surgeries, libraries and town halls—you name it. Those 3,300 are all manned by volunteers who come from a complete slice of the local population. They are the most catholic voluntary organisation in every town in this land of ours. They offer an availability to people who would otherwise be afraid, for example, of going to a solicitor to get advice. The reason is that they do not have the fear of fees there, which I am afraid is all too present with solicitors, and there is no sort of cultural problem. People do not feel at a disadvantage crossing the threshold of a CAB because they know from friends and acquaintances that they will be treated in a friendly and informal way. I am not for a minute saying that they would not be treated the same in a solicitor’s office, but we are talking about perception.
We cannot exaggerate the importance of this trust. We have had a Localism Bill, for goodness’ sake, and this is the apogee of practical localism. Given the empathy between CABs and their local populations, they get to parts that no one else reaches. I maintain that we really cannot make some of the cuts now intended, because I believe that the reverberations of those cuts will be profound. We will face, and are already facing, social pressures and strains in the wake of the economic crisis, which I fear is going to get much worse. It is precisely at this time that we need to shore up those institutions which sustain, support and give solidarity among our fellow citizens, right across the board.
I appreciate that the Minister is under strict limits as to what she can say in winding up, let alone what she can concede. However, perhaps she can at least take back to the Government the fact that this small number of Peers, late on a Thursday, were unanimous in their belief—I am sure that I can speak for those to come—that the CAB movement is a pearl beyond price, especially at this time, and that to damage it is to act in a self-damaging and counterproductive way.
I will end with a quote from that great old 17th-century philosopher, Hobbes, because down the ages, as we all know, ring plangent pleas from the populace to help them out of the thickets of the law, from Utopia through the Levellers and down to our time, with Mr Justice Darling and his wonderful remark about the law being available like the Ritz. Hobbes said:
“The safety of the people requireth … that justice be equally administered to all degrees of people; that is, that … poor and obscure persons, may be righted of the injuries done them”.
Lord Shipley
My Lords, I, too, thank the noble Lord, Lord Boateng, for initiating this debate. As a councillor for many years I have held many hundreds of surgeries for local residents. People have come to discuss problems related to housing, often around rent levels or the conditions of their homes. Over the years I have dealt with countless issues around benefits, debt, tax, employment law and disability. Competent though I have been, like most councillors, at the broad generality of such inquiries, I am only too well aware of the number of times that I have said, “I think you ought to go and see the CAB”. I would give them the address and advise them to phone ahead to book an appointment and, on occasion, to be certain that the case was being properly made, I would accompany them to that meeting. Over the years I also managed to secure CAB advice sessions in local community centres, churches and council offices, making them accessible to more people because I knew that there was unmet local demand. Almost everyone has heard of the CAB but not everyone has known how to access it, which is why signposting by council, libraries, GP surgeries and voluntary agencies has been so important.
There seems to be a unity of view in your Lordships’ House, and I would like to suggest a way in which the Government might approach the provision of free legal and other advice. This would be by developing a policy towards CABs, law centres and other voluntary organisations such as Shelter from the perspective of the individual rather than just the provider. My point is that, given the funding cuts announced and anticipated, I do not know how vulnerable individuals are going to get the help they need, when they need it and where they need it. lf law centres close and income from legal aid work is substantially reduced to organisations currently in receipt of it, forcing further closures of CAB centres and other centres in the voluntary sector, what will happen to the individuals who lack the money and resources to do things for themselves? How does that drive our equalities agenda? What will MPs and councillors be able to say at their surgeries? To whom will they be able to refer those vulnerable people? Not everything will go, of course, but the agencies involved, all of them part of the big society, work together now with case referrals to make the best use of expertise so that not all agencies need to offer the same services.
I hope that a way forward can be found that is built up from the needs of vulnerable people and then mapped across a geographical locality to ensure that coverage is maintained, rather than just implementing standard budget cuts across the board and hoping that local authorities, themselves facing large cuts, will sort things out at a local level. They can help, but the situation requires the Government to think clearly about how to provide a reasonable and fair level of support across all parts of the country.
The heart of the issue is equal access to legal advice. Those who cannot afford to purchase it need to be protected by Governments, for that is their role. Governments are there to promote social justice and social inclusion. The citizen advice bureaux lie at the heart of equal access. I hope that Ministers will take note of this, act upon it and use the opportunity of the cross-government review of government funding advice to address the problem of top-down models of funding not working on the ground as well as they should.
Baroness Howe of Idlicote
My Lords, I apologise as I am afraid that, given the crowded schedule of activities in your Lordships' House, I had not realised that the deadline for putting down my name to speak in today’s debate was last night.
I want to say a few words in this important debate initiated by the noble Lord, Lord Boateng, because, like all other noble Lords who have spoken, I have been involved with, and am a huge admirer of, CABs—in my case probably for at least 40 years. I particularly admire the incredible range of expert help that they provide for our citizens throughout the UK, especially for the most disadvantaged sections of the community.
For the past two months, many of your Lordships have been locked away upstairs, struggling with the Committee stage of the Welfare Reform Bill. Given the many changes introduced by that Bill which will affect the poorest and most disabled members of the community, expert help of the kind that CABs provide so brilliantly will be needed even more than it is now in making the best possible case for their needy clients. Like other noble Lords, I urge the Government to develop plans which will ensure that CABs’ expertise remains available as it is so demonstrably cost effective.
I, too, realise that funds to continue the CABs’ excellent work do not all come from government. There will be cuts in local authority funding and in funding from other supporters of their work as a result of the disastrous economic situation that we all face. However, in view particularly of the Legal Aid, Sentencing and Punishment of Offenders Bill, and its proposals to end legal aid funding for most civil law procedures, the need for CABs’ relatively inexpensive, but expert and certainly value-for-money, help to be available to the poorest and most needy in our communities will be even more important than it is now. If we fail to do this, the long-term results are, alas, all too predictable, with long-term costs to government resources likely to grow at an alarming rate. I hope that when the noble Baroness replies, she will be able to reassure your Lordships that the Government put a high priority on ensuring that the amazingly productive CABs continue to be available for all those who need to draw on them.
Lord Young of Norwood Green
My Lords, I, too, thank my noble friend Lord Boateng for securing this debate at a very appropriate time given all the other relevant legislation that is going through the House. He gave us a comprehensive cost-benefit analysis of the impact of the Government’s proposals and rightly suggested that they ought to think again.
Given the unanimous view of noble Lords on this issue, I was tempted to make the shortest contribution ever and say, “Ditto”. However, I thought that that might be misunderstood and that I should provide an analysis as I am speaking on behalf of the Opposition Front Bench.
The noble Lord, Lord Newton, reminded us that the CABs existed before the term “big society” had been invented and that if they did not exist, they would have had to be invented. I have only one slight caveat as regards his contribution when he said that the impact of any reduction in this service would be felt by the relatively poor and vulnerable. However, I think we should delete “relatively” as I think that such a measure will have an impact on the poor and vulnerable, and on people with disabilities even more so.
Lord Young of Norwood Green
It is. I spoke in that way to create a certain effect—nothing more than that. I do not need to quote the Cambridge CAB briefing because the noble Lord has already done that. There is another quote that I shall come to later.
The noble Lord, Lord Thomas of Gresford, rightly reminded us of people’s ability to make use of the law as regards social justice. He is absolutely right. Sixty-four per cent of CAB staff are volunteers and the key issue expressed by nearly every speaker, and by the CAB itself, is the real concern about the impact if the funding for training is not around. Some of the bureaux are saying that there is already an impact and that they are losing staff and volunteers. That precious reservoir of experience built up over the years is a loss that will be hard to replace.
The right reverend Prelate the Bishop of Newcastle gave a graphic description of the impact on rural areas. That is an issue to which we do not pay enough attention. He was also right to draw to our attention the fact that while many people are quite comfortable with making a query by using a PC and the internet, or even perhaps a smart phone, they do not suit everyone—certainly not the most vulnerable. We cannot take for granted access to those forms of communication.
My noble friend Lord Bach rightly, as did a number of noble Lords, talked about the Ministry of Justice proposals, as a result of which some CABs, given the loss of funding, may even close. He pointed out that they were trusted and respected, and he also raised the issue of access to justice and the startling cut from £28 million to £5 million. The message we want to convey to the Minister is that these are false savings. That is the unfortunate thing about this matter. Another statistic is that some 65,000 cases taken up by CABs were funded by legal aid. There is likely to be a 75 per cent cut in the number of those cases.
The noble Lord, Lord Phillips, said that he was starting to feel sorry for the Minister. I reflected on that and thought: we are coming up to Christmas, and even Scrooge managed to see the light and repent. I do not address that to the Minister in particular, but the ghost of Christmas to come might be haunting her, or at least the Government collectively. There is still time. The noble Baroness, Lady Howe, rightly reminded us of the impact of the Welfare Reform Bill.
I return to the statements made by the chief executive of Citizens Advice, Gillian Guy. She said:
“Everyone who supports Citizens Advice—and we are pleased this includes David Cameron—should be deeply concerned by the news”,
of a 7 per cent drop in the total number of people that CABs were able to help. She continued:
“It’s now clear that cuts are beginning to disrupt our front line services across the country, just as people struggle to cope with the impact of job losses, reductions in public services and a massive jump in the cost of living. We want to be there for all who need us, but when bureaux have their funding slashed, there’s simply no alternative to cutting back the help we offer”.
Ms Guy warned that there will be much worse to come if planned changes to legal aid go ahead and funding for face-to-face specialist debt advice ends. She added:
“Our clients tell us that CAB advice is a lifeline when they face debt, benefits housing and employment worries. Unless sustainable funding is put in place for the future”—
I stress “sustainable”; there has been some additional funding, but it is temporary—
“more and more people will have nowhere to turn”.
She again stresses:
“Every £1 of legal aid spent on housing, debt, employment and benefits advice can save up to £8.80 in costs to the taxpayer further down the line, by nipping problems in the bud before they escalate out of control”.
She adds:
“When bureaux are forced to reduce services, they also lose highly skilled, dedicated volunteers or staff—a tragic waste and a false economy when you take into account the resources invested in creating a highly trained volunteer workforce able to provide a professional service to the public”.
She cites a couple of examples. The noble Lord, Lord Newton, has already mentioned the Cambridge CAB. Mansfield CAB, along with other bureaux in Nottinghamshire, has had a 60 per cent cut in funding from Nottinghamshire county council, rising to 74 per cent in 2012-13, leading to difficult decisions about how to make those savings with the least impact on the service to clients. The bureau estimates that at least 2,000 fewer local people will be able to get the in-depth advice they need as a result of the cuts to its funding. It has also had to make redundant the post-holder whose function was—this is a cruel irony—to recruit, train and support volunteers, meaning that it is currently having to turn away people who want to train as volunteer advisers. That seems not only a terrible false economy but something that flies in the face of reason and the big society concept.
I am conscious of the time. I trust that the Minister will respond to the cogent and vital points that have been made, and I look forward to her reply.
The Parliamentary Under-Secretary of State, Department for Business, Innovation and Skills (Baroness Wilcox)
My Lords, I thank the noble Lord, Lord Boateng, for securing this debate. As former chair of the National Consumer Council, where we did a lot of work for consumers, including disadvantaged consumers, chairman of the National Federation of Consumer Groups, which is the grass-roots organisation, and former president of the trading standards administration, the plight of consumers is very close to my heart. The need for more and more advice in these complex and worrying times has been evidenced here tonight.
The noble Lord, Lord Young, almost said just ditto, and so could I. He has to speak for the Opposition, and I must respond for my coalition Government and be practical and report to the House what I can. The big society is about putting more power into people's hands—a massive transfer of power from Whitehall to local communities. Voluntary, community and social enterprises are, we believe, central to that vision, because they act as a mechanism for people to come together to act on a given cause and provide a voice to individuals or groups who might not otherwise be heard. Sometimes those transitions are more difficult than we think they will be.
In response to my noble friend Lord Phillips of Sudbury, I say that our vision is for the sector to play an even more influential role in shaping a stronger sense of society and improving people's lives to give them a huge range of new opportunities to shape and provide innovative bottom-up services where expensive state provision has failed. We have already pledged £470 million over the current spending period to help the sector build capacity, including a £107 million transition fund, which has been referred to tonight, to support voluntary organisations that deliver public services.
In response to the noble Lord, Lord Boateng, and my noble friend Lord Newton on funding for CABs, I say that although the transition fund has ended, the Government are acutely aware that the voluntary sector still faces challenges to its funding streams at both the national and local level, especially those organisations involved in the provision of free advice services.
On 21 November, the Government announced that we had set aside £20 million to support the sector in the short term, as well as that we would be conducting a review to consider the longer-term environment of both funding and demand and how the Government can play a role in that. The review, which has already begun, will conclude early next year. That is all I can say about the review at this time.
To date more than 1,000 organisations have benefited from the funding we have provided, including 45 citizens advice bureaux.
To the noble Lord, Lord Thomas, in response to the question on legal aid and the transition fund, I say that the Government recognise the important role that not-for-profit organisations such as citizens advice bureaux do in delivering advice services at the local level. We are working with the sector, and across government, to ensure that the implementation of government reforms helps to improve the efficiency and effectiveness of advice services available to the public. The Government will be providing, as I said, additional funding of up to £20 million in this financial year to help achieve that.
Many people, including my noble friend Lord Newton—and in fact every speaker, I think—would say that the Citizens Advice service is already the big society in action: a respected brand, independent of Government, served by a network of volunteers, which people really trust. That is why my department has been consulting on ways in which Citizens Advice might play an even stronger role in providing consumer advocacy.
We are thinking of bringing together the powers and duties currently wielded by Consumer Focus, with its long-standing expertise and experience of helping people on the front line, to make an even bigger difference for consumers. The review, as we have said, concludes early next year, and especially after tonight I am mindful of the urgency and will reflect that back.
As a Government we are committed to ensuring that people have continued access to good-quality, free and independent advice in local communities, and that is why, as I have said before, on 21 November we announced the funding to the advice service fund. This will support the not-for-profit advice service providers to deliver essential services. This fund will focus on debt, welfare benefits, housing, and employment in the short term. A review to look at funding and the demand for advice services—
Lord Phillips of Sudbury
Could my noble friend tell the House who will administer that £20 million? Who will decide where it goes?
Baroness Wilcox
I will try to answer the questions as I go along, because, first, that means noble Lords do not have to wait for me to write the answer, and secondly I can try to fit them into what I am saying so that it has some kind of flow. But more than likely I will not get it right and will wish I had not started this way. I will try to continue. The noble Lord will get his advice.
The noble Lord, Lord Shipley, spoke about the policy to protect the vulnerable. The advice sector review is seeking the input of a wide range of advice sector stakeholders, including national and local advice organisations, representative bodies, funders and other organisations that have an influential role in this sector. Continual provision of services to vulnerable consumers will be at the centre of this review, and I hope that this reassures the noble Lord, Lord Shipley, that we are looking at it.
I am pleased that my department continues to support the national umbrella bodies that support the local bureaux, but the same cannot be said of local authorities. In a number of areas, the delivery of services by local bureaux has been seriously affected by local authority spending cuts, despite clear guidance from central government that voluntary organisations should not be seen as a soft target by them.
The current financial climate is such that all avenues must be explored in finding efficiencies and unlocking savings, and because of their experience, creativity and closeness to communities, voluntary groups can frequently deliver them.
Lord Boateng
Given the failure of many local authorities to take the advice and guidance from government, I wonder if the Minister would reflect, and perhaps come back to us, on the desirability of her department encouraging consideration within government of whether to impose a duty on local authorities to make provision for advice in their areas. Surely experience shows us that when local authorities do not take guidance from central government there is a requirement at least to consider imposing a statutory duty on them to do so.
Baroness Wilcox
As a result of the debate that the noble Lord called, I can take back what he suggested. I cannot respond at the moment, but a debate such as this allows things like that to be said, on which I will go back and reflect—as I will on everything that was said, including the question of the noble Lord, Lord Phillips, to which the answer is, “We will write to Lord Phillips”. So I cannot give him the answer now, for which I apologise.
The current financial climate is such that all avenues must be explored to find efficiencies and unlock savings. Because of their creativity and experience close to communities, voluntary groups can frequently do this. Local authorities should look to strengthen, not weaken, their ties with the voluntary sector. I am pleased that councils such as Reading, Hackney, Thurrock and Wolverhampton have recognised this. Certainly I will take back the comments that the noble Lord, Lord Boateng, has just made.
I felt that this debate was almost a forerunner for the Committee stage of the Legal Aid, Sentencing and Punishment of Offenders Bill. I also felt that I could not tell noble Lords very much more than what we are doing at the moment, which is almost all that I have done. It simply remains for me to recognise the excellent work carried out by Citizens Advice nationwide. In future, our goal is for Citizens Advice to be at the heart of providing consumer information, advice, education and advocacy. In the mean time, I am glad that my department's financial support for the central operations of the Citizens Advice network helps bureaux to go on being the mainstays of community life.
As I said, I will take away the speeches that emphasised the urgency of need, and in particular the speech of the right reverend Prelate the Bishop of Newcastle, who spoke so movingly of the need in rural areas. It is easy to forget when we spend so much time in central London that the area I come from—Cornwall—and the area he reflected on are large areas with small populations where it is very difficult to get advice.
I will take back the reflections of my noble friend Lady Gardner on the fact that language is sometimes a barrier, not an access, and that we must be careful to make sure that everything does not happen online. I hope that the results of the review that I reflected on will enable the Government better to reflect what we have heard tonight.