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Oral Answers to Questions
(13 years ago)
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Alec Shelbrooke (Elmet and Rothwell) (Con)
1. What assessment he has made of the potential effects of planned changes to Government procurement on UK businesses bidding for contracts.
Mark Pawsey (Rugby) (Con)
6. What assessment he has made of the potential effects of planned changes to Government procurement on UK businesses bidding for contracts.
Mr Mark Spencer (Sherwood) (Con)
7. What assessment he has made of the potential effects of planned changes to Government procurement on UK businesses bidding for contracts.
The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
On 21 November, I announced a package of measures to transform how the Government buy. We want to save money for the taxpayer and for suppliers and to make it easier for small and medium-sized enterprises and voluntary organisations to bid successfully. That is why we have announced a pipeline of £50 billion-worth of future business opportunities. We will make it 40% quicker to do business with Government and we will, in future, engage proactively with current and future suppliers to discuss upcoming procurement opportunities.
Alec Shelbrooke
Will my right hon. Friend describe to the SMEs in my constituency of Elmet and Rothwell where they should go if they have any problems or issues with Government procurement?
Mr Maude
If there are problems not only in how central Government procure but across the wider public sector, I hope that my hon. Friend’s constituents will make contact with my Department through the helpline that we have set up specifically for the purpose. If they highlight how procurements are being done that entrench the old, inefficient and anti-enterprise way of doing things, we can then intervene proactively, as we have done on a number of occasions, to make improvements.
Mark Pawsey
It is the small businesses that often have the greatest difficulty in accessing Government contracts, and that is because of a regulation from the European Union. Will the Minister tell us what steps he is taking to reform EU regulations to make it easier to secure contracts with Government both at a national and local level?
Mr Maude
The first thing that we are doing is trying to ensure that the way in which we implement the European directives is sensible and not overly bureaucratic and legalistic, which it usually is at the moment. The European Commission is introducing proposals to streamline and simplify the procurement directives, which we welcome. I was talking to Commissioner Barnier in Brussels two or three weeks ago, and he was very open to that happening.
Mr Spencer
Fresh Opportunities is a company in my constituency that supplies water drinkers to jobcentres. Sadly, though, it lost the contract. That was not because it was inefficient or too expensive but because it could not deliver a service on a large enough scale. What can the Minister do to enable SMEs, which cannot operate on a national scale, to be able to deal with Government bodies?
Mr Maude
We have two objectives here. We want to buy as efficiently as we can, which, in many cases, means using the scale of Government to aggregate volume and drive down prices. In many areas of procurement of commodities, goods and services, we are able to get the price advantages of aggregation but, none the less, involve SMEs much more in the process. We have a commitment and an aspiration to increase the value of SME business to 25% of the total.
Ms Margaret Ritchie (South Down) (SDLP)
The Minister will be aware that public procurement guidelines in Northern Ireland are set by EU directives and UK regulations. Will the Minister, therefore, give a commitment to work alongside the Northern Ireland Executive and not to turn his back on Europe in negotiations to tackle the issues of over-complexity, cost and red tape, as those are issues that are affecting local business?
Mr Maude
As I said, we are actively engaged with the European Commission in supporting the good work that it is undertaking to streamline procurement processes, but we need to ensure—and I hope that the hon. Lady will do this—that the Administration in Northern Ireland do not overimplement the directives because we are finding that central Government and the wider public sector in Great Britain tend to do that.
Mr Mark Williams (Ceredigion) (LD)
Notwithstanding what the Minister said about the economies of scale, the Federation of Small Businesses has reported an increased tendency for public sector contracts to be aggregated into much larger ones, thereby penalising smaller businesses. What has the Minister got to say to those small businesses?
Mr Maude
There is a whole range of procurement opportunities that are particularly suitable for smaller businesses. Even when we aggregate, that does not exclude small businesses. For example, we have just let the contracts for travel for the whole of Government and one of the successful two bidders is a very small business, which, as a result of winning that contract, will become a much bigger one.
Mr Bernard Jenkin (Harwich and North Essex) (Con)
Can my right hon. Friend include in that assessment the ability of charities and small organisations, mutuals and so on to bid for public sector contracts as providers of public services? May I commend the report that the Select Committee on Public Administration has published today on the big society, which recommends that the Government extend the eligibility for the VAT refund scheme, which currently applies to public sector bodies, to charities that deliver public services under contract with a public sector organisation?
Mr Maude
I shall ensure that my right hon. Friend the Chancellor takes note of my hon. Friend’s suggestion. We want to make it easier for small voluntary organisations and mutuals to bid successfully. One thing that we aim to do is to get contracts chunked up into smaller lots. We have much bigger contracts, generally, than France or Germany would have in equivalent circumstances, which tends to militate and be biased against the interests of smaller businesses and voluntary and charitable organisations.
Jonathan Ashworth (Leicester South) (Lab)
3. What assessment his Department has made of the role of the big society initiative in tackling social exclusion.
The Minister of State, Cabinet Office (Mr Oliver Letwin)
The big society is all about building social capital, which is key to solving social exclusion. There are four places where most of us build the relationships that sustain us: in the family, in school, in our communities and at work. We are taking action to build social capital in all of those through a focus on the 120,000 most troubled families, through competition and raising standards in schools, through community organisers and the community first initiative in communities and through the Work programme, the rehabilitation revolution and the drug and alcohol recovery programme.
Jonathan Ashworth
I thank the Minister for that answer and I know that he is sincere in wanting to see civic society flourish, as am I. In Leicester, many organisations who work with vulnerable people at risk of social exclusion, such as the Shama women’s centre or those at the Saffron Lane resource centre, increasingly find that their grants and pots of money are being cut. Does the Minister think he will be able to create the big society on the cheap?
Mr Letwin
As I said the previous time the hon. Gentleman asked such a question, he is extraordinarily assiduous in this area. I have done some further research on where he has been recently and the Saffron Lane centre that he describes is, I am glad to say, one area where the community organisers to which I referred will be located. While I am at it, it is clear that the hon. Gentleman drags the Government with him every time he goes anywhere. He also visited the Eyres Monsell centre and that is now receiving a £50,000 grant from the community grants system. We can be said to be delivering not on the cheap but on the expensive in the hon. Gentleman’s constituency.
Jon Trickett (Hemsworth) (Lab)
This year, 40,000 households were made homeless. As we approach Christmas and with today’s rise in unemployment, Shelter estimates that every two minutes someone else faces losing their home. Now we hear that Government cuts to the big society have resulted in homeless charities facing 25% reductions in their funding. Will the Minister at least immediately agree to restore the social exclusion taskforce, which the Government shamelessly abolished when they entered the Cabinet Office, so that in the future the homeless and others who suffer from social exclusion will at least have a voice when he and his colleagues make such hard-hearted decisions?
Mr Letwin
I am sorry that the hon. Gentleman misunderstands the changes in the machinery of government that have taken place under this Government. It is perfectly true that the social exclusion taskforce has been abolished, and the reason for that is that we have set up instead a fully fledged first-rank Cabinet committee on social justice—
Mr Letwin
It is not in the least secret, as the hon. Gentleman mutters from a sedentary position, in the sense that it will produce a social justice strategy that he will be able to read along with the rest of the House. I think he will find that we are putting absolutely at the centre of our activities the fostering of the big society in order to help, among other things, those who are homeless. That is also one of the reasons why we recently issued our housing strategy, which does more than the hon. Gentleman and his colleagues did in many years to try to improve housing in this country.
Jim McGovern (Dundee West) (Lab)
4. Whether his Department has considered altering its guidance on the disposal of official Government documents.
Jim McGovern
According to Cabinet Office guidance, what would be the recourse if a civil servant in the Minister’s Department breached the Data Protection Act?
Mr Maude
I can provide a detailed answer to the hon. Gentleman if he requires. If he is concerned about classified Government documents going amiss, I suggest he raises the matter with his right hon. Friend the shadow Health Secretary, who in 2009 had to apologise for leaving a briefcase full of classified Government documents on a train.
Richard Fuller (Bedford) (Con)
5. What recent progress he has made in establishing Big Society Capital.
The Parliamentary Secretary, Cabinet Office (Mr Nick Hurd)
Big Society Capital is all about trying to make it easier for social entrepreneurs to access capital. We think that we are making good progress, moving swiftly through the Financial Services Authority authorisation and EU state-aid approval processes, and we are confident that Big Society Capital will be open for business by spring. In the meantime, the interim investment committee, which made its first investment in July, will announce its next investment shortly.
Richard Fuller
I thank the Minister for his answer. My focus is on the voluntary organisations whose budgets are always tight, so will he advise me on how he can enhance their capacity to take advantage of the opportunities afforded by Big Society Capital?
Mr Hurd
My hon. Friend knows from his lengthy experience in the area that we have fantastic social entrepreneurs in this country, and we want to make it easier for them to access capital, but, as he points out, some of them need more help to become more investment-ready. That is exactly why we have set up a £10 million investment and contract readiness fund—to provide grants for organisations that want to attract investment but know they need more help to become more investment-ready.
Mr Gareth Thomas (Harrow West) (Lab/Co-op)
Among the Public Administration Committee’s many criticisms in its report today, it rightly highlights that Ministers cannot expect the big society bank to provide the solution to the funding crisis that their cuts are causing for hundreds of charities. Given that the report goes on effectively to accuse Ministers of being out of touch and not providing effective leadership to tackle the problems that charities face, would not now be the perfect time for yet another one of the Prime Minister’s big society re-launches?
Mr Hurd
I am not going to take any lectures on leadership and Big Society Capital from the Opposition, because they talked for 10 years about setting it up but did not actually do it. We are doing it because we want to make it easier for social entrepreneurs to access capital. It is on track, and we are very proud of it.
Ian Murray (Edinburgh South) (Lab)
8. What steps he is taking to encourage employee mutuals to develop and run central Government services.
The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
As we set out in the “Open Public Services” White Paper, we are committed to an ambitious programme of mutualisation, allowing staff to break free of bureaucracy and to spin out from the public sector. To support that, we have put in place the mutuals support programme, the mentoring of mutuals by groups such as John Lewis, the mutuals task force chaired by Professor Le Grand and the mutuals information service, and we are increasing the “right to provide” scheme.
Ian Murray
The Minister for the Cabinet Office expects there to be an extra 1 million workers in organisations taking over the running of public services by 2015. Will he update the House on how many he expects to be doing so by the end of this financial year?
Mr Maude
I have certainly not set a target of 1 million, but it is perfectly feasible that 1 million public sector workers will choose to take themselves out of the public sector in order to deliver in employee-led organisations the services that they currently provide. The number is growing, and, although we cannot make it happen, we are going to make it a great deal easier and to support all those groups. The benefits are huge in terms of productivity. Staff absence falls, staff turnover falls and customer satisfaction rises very dramatically, so I hope that we have the hon. Gentleman’s enthusiastic support for this programme of mutualisation.
Craig Whittaker (Calder Valley) (Con)
9. How small and medium-sized enterprises in Calder Valley constituency can bid for central Government information and communications technology and facilities management contracts.
The Minister of State, Cabinet Office (Mr Oliver Letwin)
It is absolutely vital that small and medium-sized enterprises should be able to bid for ICT and other contracts, and that is why the Minister for the Cabinet Office said a moment or two ago that we have set an ambition for 25% of contracts to go to SMEs. We have also simplified the contracting process, making it easier for SMEs to find out what the Government seek to purchase, and I recommend that the enterprises in my hon. Friend’s constituency look at the Contracts Finder website, which I have been on myself, It is an absolutely admirable one-stop shop for finding out about Government contracts.
Craig Whittaker
I thank the Minister for that reply. I am not a cynical kind of guy, but I wonder whether he can give the House some examples of how the Government are helping SMEs by awarding them contracts.
Mr Letwin
Yes, I can, and I refer again to something that my right hon. Friend was saying. Recently, the Government’s very large domestic travel contract was let—the domestic side alone amounts to £1.1 billion a year of travel—and one might have expected it to go to a very large firm, but, because of the way in which my right hon. Friend structured it, it went to Redfern Travel, a company with 33 employees. It is a small or, at any rate and by anyone’s definition, only a medium-scale enterprise, and it was able to win the contract. The managing director said:
“The award of this contract…clearly demonstrates that…any SME can not only bid for major Government contracts, but also meet the challenging requirements”,
so I think that that is a very good test case.
Mr Speaker
Order. It is normally a great pleasure to hear from the hon. Lady, but the Wirral is a little distance away from Calder Valley, to which this question exclusively relates. We will save her up for another occasion.
Mr Philip Hollobone (Kettering) (Con)
10. What progress he has made in reaching agreement with trade unions on the Government’s proposed reforms to public sector pensions.
The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
We have engaged in intensive and frequent discussions with the trade unions. At their request, talks are continuing at scheme level in the four public sector pension schemes that are currently being discussed, and we continue to make progress, I believe, in all four. We are determined that public sector pensions will remain among the very best available, but in order to make them sustainable and affordable for the long term, reform is urgently needed.
Mr Hollobone
Under the Government’s offer, a teacher earning £32,000 a year could anticipate a pension of £20,000 a year, whereas a private sector worker earning the same salary would have to devote some 38% of his or her wages in order to get a pension of the same size. Given the terms of the Government’s offer, should the trade unions not now call off any threat of further industrial action?
Mr Maude
I simply pray in aid what Lord Hutton, the former Labour Pensions Secretary, said yesterday, when he referred to public sector trade unions “holding a gun” to the taxpayer’s head. He said that the offer was generous and that it was hard
“to envisage a better offer being made.”
I hope that we can now move quickly to resolve the final, outstanding issues, so that we can move on without further disruption to people’s lives.
Mr Ben Bradshaw (Exeter) (Lab)
Given that the Minister’s Department is currently the worst in Whitehall for meeting the Government’s business plan targets—targets for which he is responsible—having missed 38 at the last count, would his time not be better spent sorting out his own Department, rather than picking fights with public sector unions?
Mr Maude
The short answer is that we want to get these public sector pension issues resolved quickly. I would be quite interested to know whether the right hon. Gentleman shares our belief—and that of Lord Hutton, his former colleague—that we are talking about a generous offer that the trade unions should accept, and that they should stop “holding a gun” to the taxpayer’s head. Does he agree with that?
John McDonnell (Hayes and Harlington) (Lab)
The Minister earlier announced that if he had not secured agreement by Christmas, he would impose a pensions settlement or scheme on the unions. Is that still his intention, and if it is, will he make a statement to the House next week?
Mr Maude
We very much hope that it will not be necessary for the Government to move to the stage of imposition. Our intention is that we should reach agreement. It is necessary that we reach agreement by the end of the year, because there is a lot of work to do to put the new schemes in place as early as possible, so that people know what their future holds and we can implement the new schemes; so yes, we will be making further announcements to the House before it rises.
Julie Hilling (Bolton West) (Lab)
11. What steps he is taking to support the voluntary sector.
The Parliamentary Secretary, Cabinet Office (Mr Nick Hurd)
We are supporting the sector through this difficult time by cutting red tape, investing in transition funds for infrastructure and front-line organisations, creating significant new opportunities for the sector to deliver public services, and supporting new initiatives to encourage giving and social investment.
Julie Hilling
The Roots project in Westhoughton in my constituency has been praised by the Government as a beacon of the big society, but Liz Douglas, the founder, has had no wages for six months. Words are no good. When will the Minister take action to support the voluntary and community sector?
Mr Hurd
The hon. Lady knows that we have taken a great deal of action, not least by putting in place a £107 million transition fund to help the most vulnerable organisations. If she is talking about cuts being made locally by Bolton council, she will know that the reduction in its spending this year was only 7%. The questions that she has to ask Bolton council are: “Why were you so badly prepared for this situation?” and: “Why did you block a proposal from Conservative councillors to create a fund to support local voluntary organisations?”
Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab)
T1. If he will make a statement on his departmental responsibilities.
The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
My responsibilities are for the public sector Efficiency and Reform Group, civil service issues, industrial relations strategy across the public sector, Government transparency, civil contingencies, civil society and cyber-security.
Tom Blenkinsop
Lists for 2010 failed to mention that the Prime Minister met Rupert Murdoch in June 2010. This was amended to ensure transparency only recently. Why?
Miss Anne McIntosh (Thirsk and Malton) (Con)
T2. Mindful of the fact that we have not had flooding for a number of months and mindful of the forecasted storm weather, can the Minister for the Cabinet Office assure us that flood rehearsals are taking place between all the relevant emergency services on a regular basis?
Mr Maude
I can certainly confirm that. Meetings are taking place between the relevant Departments—one took place earlier this morning—to ensure that capabilities are in place in advance of any possible flooding, with urgent consideration given to ensuring that the public receive the right advice. I am glad to say that the forecast is looking a little better than it was.
Mr Speaker
Order. There are far too many noisy private conversations taking place in the Chamber. The House must come to order.
Michael Dugher (Barnsley East) (Lab)
According to figures published by the Cabinet Office last week, the Deputy Prime Minister has appointed four more special advisers at a cost to the taxpayer of at least £190,000. At a time when the average family is set to lose £320 a year as a result of tax credit changes and at a time when almost everyone is asking what exactly is the point of the Deputy Prime Minister, does the Minister think that this is a good use of public money?
The Minister of State, Cabinet Office (Mr Oliver Letwin)
I would have thought that the hon. Gentleman would realise that it is extremely important in a coalition that the Deputy Prime Minister as well as the Prime Minister should have adequate research support. It is extraordinarily difficult for Government Members to take comments of that kind seriously, given the previous Government’s record on employing special advisers.
Simon Hart (Carmarthen West and South Pembrokeshire) (Con)
T5. Can the Minister confirm how many civil servants went on strike in the recent action?
Mr Speaker
Order. I know that the House wants to hear the right hon. Gentleman’s answer.
Mr Maude
I sense that the House is waiting on the edge of its seat for my answer. On 30 November, 146,256 civil servants went on strike, which represents about 30% of the civil service work force. I would like to express my appreciation to the 70% of civil servants who came to work that day as normal.
Karl Turner (Kingston upon Hull East) (Lab)
T4. The Minister is refusing to negotiate with the unions over pension contribution increases, the retirement age, cost ceiling, indexation and other issues. Is that not typical of this Government, proving that they enter into negotiations with no intention whatever of coming to an amicable agreement? Are not the Government spoiling for a scrap with the trade unions?
Mr Maude
Far from spoiling for a scrap with the trade unions, we are engaged in very intensive discussions with them. Even in the week during which the strike took place—a completely unnecessary strike, which the Labour party refused to condemn, massively inconveniencing many people and damaging the economy—a number of meetings took place with the trade unions to try to secure agreement on the much needed reforms. Let me remind the hon. Gentleman that Lord Hutton, the former Labour Pensions Secretary, has said that this is a generous offer and that the unions should stop “holding a gun” to the taxpayer’s head.
Harriett Baldwin (West Worcestershire) (Con)
T6. Malvern has a cluster of firms—small, medium and large—with expertise in cyber-security. I invite the Minister down to Malvern to meet them.
Diana Johnson (Kingston upon Hull North) (Lab)
T8. Does the Minister have any regrets about the way in which he has conducted negotiations with the public sector trade unions by using megaphone diplomacy through the media and not providing information in a timely way?
Mr Maude
No, I have no regrets at all. We have engaged in very intensive discussions over a long period with the unions and the leadership of the TUC over the individual schemes. If the hon. Lady thinks we are not negotiating, she should talk to the TUC about the intensiveness of the negotiations. Perhaps she would like to remind her friends in the unions of what Lord Hutton, the former Labour Pensions Secretary, said only yesterday about the Government’s offer. [Interruption.]
Simon Hughes (Bermondsey and Old Southwark) (LD)
T7. What contribution are Departments making to greater energy efficiency and reducing carbon emissions following the successful Durban summit?
Mr Maude
In the first year following the forming of the coalition Government, we cut carbon emissions by more than the 10% target that we had set ourselves. We have also committed ourselves to ensuring that carbon emissions from Government buildings—Government property—fall by no less than 25% during the current Parliament, and I am confident that we will fulfil that commitment.
Chris Ruane (Vale of Clwyd) (Lab)
The Electoral Commission announced today that there are not 3 million but 6 million missing, unregistered voters. Does the Minister agree that the equalisation of seats should be postponed, or suspended, until a full investigation has been conducted to establish where those 6 million people are?
Graham Evans (Weaver Vale) (Con)
T9. The national citizens service is an excellent initiative to help young people to develop the skills and attitudes that they need in order to become responsible citizens. Can the Minister tell me what local branches of the service will be available to them in my constituency?
The Parliamentary Secretary, Cabinet Office (Mr Nick Hurd)
I will write to all Members shortly to tell them which providers of the service are operating in their local authority areas, but I can confirm that providers will be working in Cheshire East and in Cheshire West and Chester next year. I strongly encourage all Members to become involved with this programme, which provides a fantastic opportunity for young people.
Richard Fuller (Bedford) (Con)
Q1. If he will list his official engagements for Wednesday 14 December.
The Prime Minister (Mr David Cameron)
I am sure that the whole House will wish to join me in paying tribute to Sapper Elijah Bond of 35 Engineer Regiment, who died in Queen Elizabeth hospital, Birmingham last Thursday as a result of wounds that he had sustained in Afghanistan. He was a dedicated and highly professional soldier, and at this tragic time we should send our condolences to his loved ones, his friends and his colleagues.
This morning I had meetings with ministerial colleagues and others. In addition to my duties in the House, I shall have further such meetings later today.
Richard Fuller
Let me associate myself and, I am sure, all other Members with the Prime Minister’s words about Sapper Elijah Bond.
The people of Bedford and Kempston will be disappointed that this week’s report on the financial crisis in the Royal Bank of Scotland contained no provision for the criminal prosecution of executives, directors, regulators and Ministers for their failures. Can the Prime Minister assure me that, unlike the last Government, his Ministers will reinforce financial regulations, and will not undermine them as the shadow Chancellor did when he was in office?
The Prime Minister
My hon. Friend is right, and as he will know, we are considering specific extra measures. We are considering sanctions in relation to what was done by people on the board of RBS. However, the report was not just damning about the board of RBS; it was damning about the politicians who were responsible for regulating RBS. And it did not just name politicians who are no longer serving: it also named the shadow Chancellor.
Edward Miliband (Doncaster North) (Lab)
I join the Prime Minister in paying tribute to Sapper Elijah Bond of 35 Engineer Regiment. He bravely gave his life in trying to improve the lives of others, and all our thoughts are with his family and friends. As we approach Christmas, our thoughts are also with all our troops who are serving so bravely in Afghanistan and elsewhere. Many will be spending Christmas away from their families and friends to ensure a peaceful Christmas for us, and we owe them a huge debt of gratitude.
In this, the last Prime Minister’s Question Time of the year, let me remind the Prime Minister of what he had to say in his new year message of 2011. He said:
“Uppermost in my mind as we enter the New Year is jobs.”
In the light of today’s unemployment figures, can he explain what has gone wrong?
The Prime Minister
First, let me join the right hon. Gentleman in his fitting and right tribute to our forces at Christmas time—those who are serving in Afghanistan, but also those who are serving in other parts of the world. One of the things that strikes you most in this job is that they are the best of the best. They are brave, they are courageous, they are dedicated, and their families, too, give up a huge amount. I join the right hon. Gentleman in saying that.
Let me say about the unemployment figures that any increase in unemployment is bad news and a tragedy for those involved, and that is why we will do everything we can to help people back into work. That is why we have the Work programme, which will help 2.5 million people; that is why we have the massive increase in apprenticeships that will help 400,000 people this year; and that is why we will give particular help to young people through the youth contract and through the work experience places. We will do all we can to help people back into work.
Edward Miliband
But the figures show that the Prime Minister’s economic strategy is failing. The Chancellor said at the time of the spending review last year:
“private sector job creation will far outweigh the reduction in public sector employment.”—[Official Report, 29 November 2010; Vol. 536, c. 531.]
Will the Prime Minister confirm that over the last three months, for every job being created in the private sector 13 are being lost in the public sector?
The Prime Minister
Let me give the right hon. Gentleman the figures. Since the election, in the private sector there have been 581,000 extra jobs. In the public sector, he is right that we have lost 336,000 jobs, so we need private sector employment to grow even faster. But let me make this point to him, because I think this is important: whoever was in government right now would have to be making reductions in public spending. The only way you can keep people in work in the public sector while doing that is to cut welfare—something we are doing and he opposes—or to freeze public sector pay—something we are doing and he opposes—or to reform public sector pensions—something we are doing and he opposes. So it is all very well standing there and complaining about the rise in unemployment, but if we do not take those steps, we would lose more jobs in the public sector.
Edward Miliband
I think the whole House will have heard that the Prime Minister cannot deny that the central economic claim that he made—that the private sector would fill the gap left by the public sector—has not been met. He has broken his promise, and today’s figures also confirm that youth unemployment not only remains over 1 million; it is still rising, and long-term youth unemployment has gone up by 93% since he made his new year pledge on jobs. Is not the reality that he is betraying a whole generation of young people?
The Prime Minister
We will not take lectures from a party that put up youth unemployment by 40%. That is the case—even the right hon. Gentleman’s brother admitted the other day that youth unemployment was not a problem invented by this Government; it has been going up since 2004. But let me explain what we are doing to help young people get a job. Through the youth contract we are providing 160,000 new jobs with private sector subsidies. With the 250,000 work experience places, half those people are actually getting jobs and getting off benefit within two months. That is 20 times more effective than the future jobs fund.
But the absolute key to all this is getting our economy moving. We need private sector jobs. It is this Government who have got interest rates down to 2%—that is why we have the prospects of growth—whereas the right hon. Gentleman’s plans are for more spending, more borrowing and more debt: more of the mess that we started with.
Edward Miliband
The truth is that the Prime Minister’s promises to young people for next year are as worthless as the promises he made in 2011. Let us turn from his broken promise on jobs to his broken promise on the coalition. And Mr Speaker, let me say that it is good to see the Deputy Prime Minister back in the House. This is what the Prime Minister said—[Interruption.] Calm down. This is what he said in his new year’s message for 2011—and I will place a copy in the Library of the House, just so that everyone can see it:
“Coalition politics is not always straightforward…But I believe we are bringing in a”
whole
“new style of government.”
[Hon. Members: “More! More!”] There is more:
“A more collegiate approach.”
I am bound to ask, what has gone wrong?
The Prime Minister
I will answer. No one in this House is going to be surprised that Conservatives and Liberal Democrats do not always agree about Europe, but let me reassure the right hon. Gentleman. He should not believe everything he reads in the papers. It’s not that bad—it’s not like we’re brothers or anything! [Hon. Members: “More! More!”] He certainly walked into that one.
Edward Miliband
I think our sympathy is with the Deputy Prime Minister. His partner goes on a business trip and he is left waiting by the phone, but he hears nothing until a rambling phone call at 4 am confessing to a terrible mistake.
How is the Prime Minister going to pick up the pieces of the bad deal he delivered for Britain? The Council came to conclusions on Friday morning, but the treaty will not be signed until March. In the cold light of day, with other countries—[Interruption.]
Mr Speaker
Order. Some very, very foolish person shouted out “Stop”. The person who did that will stop, because people in this place must be heard. If there is a Member here who does not think so, I invite that Member to leave the Chamber.
Edward Miliband
In the cold light of day, with other countries spending the weeks and months ahead trying to see whether they can get a better deal for themselves, would not the sensible thing for the Prime Minister to do be to re-enter the negotiations and try to get a better deal for Britain?
The Prime Minister
First, I make no apologies for standing up for Britain. In the past two days we have read a lot about my opinions and we have read a lot about the Deputy Prime Minister’s opinions; the one thing we do not know is what the right hon. Gentleman would have done. While he was here on Monday his aides were running around the Press Gallery briefing that he would not have signed up to the treaty. Well, here is another try: what’s your answer?
Mr Speaker
I have no answer on this matter whatsoever—[Interruption.] Order. I am glad the Minister of State, Department of Health, the right hon. Member for Chelmsford (Mr Burns), has returned from his travels. We wish him a merry Christmas, but in his case it should be a quiet one.
Edward Miliband
There was a better deal for Britain that the Prime Minister should have got, and that is what the Deputy Prime Minister himself says. Here is the truth: last week the Prime Minister made a catastrophic mistake, and this week we discover that unemployment is at its highest level for 17 years. This Prime Minister thinks he is born to rule. The truth is that he is just not very good at it.
The Prime Minister
Even the soundbite was recycled from a previous Prime Minister’s Question Time. On Wednesday the answer was no. Today—I think—the answer is maybe. This Leader of the Labour party makes weakness and indecision an art form; that is the fact.
The right hon. Gentleman gave me my end-of-year report; let me give him his. He told us at the start of the year, in his new year’s message, that the fightback started in Scotland. Well, that went well, didn’t it? He told us that he would have credible plans to cut the deficit, but we still have not seen them. He said that he would stand up to vested interests, yet he backed the biggest strike for years. We all know that he has achieved one thing, though. He has completely united his party. Every single one of them has asked Santa for the same thing: a new leader for Christmas.
Mr Speaker
Order. I am sure Government Back Benchers want to hear their own colleague, Mr Martin Vickers.
Martin Vickers (Cleethorpes) (Con)
Thank you, Mr Speaker. Yesterday’s announcement about local television was good news for my constituency, where Channel 7, the sole survivor from the original batch, is based. Does the Prime Minister agree that local broadcasting strengthens local communities and advances the big society? If he is in north Lincolnshire in the near future, will he find time to pay Channel 7 a visit?
The Prime Minister
I would be delighted to do that. I do not have any immediate plans to visit north Lincolnshire, but I do support local television. I also think that north Lincolnshire had some very good news with the Siemens plant going into Hull. That is excellent news for the whole region.
Mr David Blunkett (Sheffield, Brightside and Hillsborough) (Lab)
Q2. In the early new year the Government intend to announce a wholesale revision of the national curriculum. May I put it to the Prime Minister that it would be perverse—in fact it would be absurd—to require those coming from abroad to settle in Britain to learn about our democracy and to take citizenship courses while withdrawing the teaching of citizenship and democracy to our own children in our schools?
The Prime Minister
I listen very carefully to what the right hon. Gentleman says, because I agree with some of the proposals about citizenship that he put forward when he was Home Secretary. Many Members will have been to the citizenship ceremonies that he was responsible for, which have been a good addition to our country and our democracy. On behalf of the whole House, I pay tribute to him for that. We will look very carefully at what he says about the curriculum, but the key aim has to be to making sure that we teach the basics properly and well, and that we test on those basics, because if someone cannot read and write properly, no lessons in citizenship will mean anything at all.
Justin Tomlinson (North Swindon) (Con)
Ninety-one per cent. of people who get into financial difficulty believe they would have avoided doing so had they been better informed. Therefore, ahead of tomorrow’s debate on financial education, will the Prime Minister support our calls for compulsory financial education for young people?
The Prime Minister
This very much links with the previous question. I strongly support teaching young children about the importance of financial education, but the point of having a proper review of the curriculum is to make sure that we know what is absolutely essential and core and what can be included as extra lessons.
Yvonne Fovargue (Makerfield) (Lab)
Q3. Unemployment is going up and living standards are being squeezed. Many more people are being forced into the hands of the payday lenders and fee-charging debt management companies. Will the Prime Minister act to protect ordinary people who are being preyed on and ripped off?
The Prime Minister
The hon. Lady speaks with great experience, because she worked for Citizens Advice before coming to the House. She stands up for Citizens Advice and is right to do so. All of us know what a brilliant job it does in our constituencies. She will know that the previous Government wrestled with the issue of how best to regulate doorstep lenders and other lenders, and the danger of driving people into the hands of loan sharks if we got rid of the regulated sector. I am very happy to discuss this further with interested colleagues. It is a very difficult subject to get right, but the Government are working at it.
Simon Wright (Norwich South) (LD)
Does the Prime Minister share my concern about the impact of pocket-money priced alcohol on the state of our nation’s health and antisocial behaviour in our town centres, as well as about the damage it does to our community pubs?
The Prime Minister
The hon. Gentleman makes an extremely important point. There is no doubt in my mind that very low-cost alcohol is part of the problem in our town centres. One of the answers that the Government have already come up with is to ban the deeply discounted selling of alcohol, but we need to look at the broader question of low-cost alcohol. I have noted very carefully the letter in the papers this morning from a whole set of people with great expertise on this, and we are looking carefully at the issue.
Mrs Jenny Chapman (Darlington) (Lab)
Q4. This morning we learned that the Teesside airport is up for sale and it seems that, as unemployment is sky-rocketing in the north-east, our planes may be grounded. Is not the loss of infrastructure and jobs in the north-east further evidence that this Government’s economic plan is a catastrophic failure?
The Prime Minister
The key thing about the future of Durham Tees Valley airport, which is a vital airport, is not necessarily who owns it but whether it is being invested in and expanded. Is it working well? That is the key question, and that is the question that I know my right hon. Friend the Transport Secretary is looking at carefully.
Sheryll Murray (South East Cornwall) (Con)
Q5. Has the Prime Minister seen the OECD and National Institute of Economic and Social Research findings this week, which show that soaring immigration was caused not by the prospect of prosperity but by the open-door policies of the previous Government—and will he prevent that from happening again?
The Prime Minister
My hon. Friend is absolutely right. The report said specifically that
“the increase in net immigration to the UK was not driven primarily by the economic performance of the UK or other countries.”
Instead, the report points to immigration policy. The fact is that the previous Government quadrupled immigration and let an extra 2.2 million people into the country. The answer is to deal with the bogus colleges, and we are doing that; to put a limit on economic migration from outside the EU, and we are doing that; and to have proper border controls and a border police command, and we are doing that as well.
John Robertson (Glasgow North West) (Lab)
Q6. The autumn statement saw 400,000 Scottish children lose more than £40 million as a result of changes in the tax system. In my constituency that meant that £600,000 was taken from children. Why is the Prime Minister taking money out of children’s pockets, while allowing it to remain in the pockets of bankers?
The Prime Minister
I am afraid the hon. Gentleman is just plain wrong: the child tax credit is going up by £135. He talks about the bankers, but it is this Government who have put in place a bank levy that will raise more every year than Labour’s one-off bonus tax raised in one year.
Julian Sturdy (York Outer) (Con)
Q7. As a York MP, I am extremely proud of our city’s vibrant tourism sector. Does my right hon. Friend agree that tourism plays a key role in our local economies? Will he ensure that northern tourist attractions in particular are promoted in the run-up to the Olympic games?
The Prime Minister
My hon. Friend makes an important point. Millions of people will be coming to this country for the Olympic games. We need to encourage them not just to go to the Olympic games, but to visit other parts of the country and to return to Britain for a subsequent visit. We will be running all sorts of promotions and schemes to encourage that. If we could encourage people more generally to visit other places as well as London—York has many great tourist attractions and things of historical importance to see—we would drive a huge amount of jobs and growth in our regions.
Rushanara Ali (Bethnal Green and Bow) (Lab)
On 16 December Bangladesh will mark its 40th anniversary as an independent nation, following a war that cost 3 million lives. I want to pay tribute to the contribution made by this Parliament in supporting the people in their fight for liberty and self-determination. As Bangladesh is the country that is the second most vulnerable to climate change, with an estimated 15 million to 20 million people likely to be affected in the coming decades, does the Prime Minister agree that it is now more important than ever to support developing countries against the devastating effects of climate change?
The Prime Minister
I absolutely agree with the hon. Lady. The whole House should recognise what she has done in raising the issue at this time, as Bangladesh approaches this important anniversary. Britain can be proud of the fact that we have very good relations with Bangladesh, and our aid programme in Bangladesh is now of the leading ones from anywhere in the world into that country. We are spending specific money on helping the Bangladeshis with climate change, meeting all the promises that we made. I have met the Prime Minister of Bangladesh. One of the issues that we do have to raise, though, is that there are human rights issues in Bangladesh, and we should not be scared of raising them with the authorities in the proper way.
Mr Philip Hollobone (Kettering) (Con)
Q8. An EU-wide agreement on prisoner transfers comes into force this month, which will enable the UK to repatriate to jails in their own country any EU nationals imprisoned here. Given that some 13% of our prison population is made up of foreign nationals, will the Prime Minister ensure that our EU partners stick to these new rules and take their criminals back?
The Prime Minister
If my hon. Friend, with his strong views, is asking a question about a successful EU scheme, it really must be Christmas, so his question is very welcome. He is absolutely right: 13% of our prison spaces are taken up by foreign nationals. That is hugely expensive, and the EU-wide agreement gives us a great opportunity to return people to their national prisons and save money at the same time.
Mr Bob Ainsworth (Coventry North East) (Lab)
Is freezing the pay of young privates and corporals while they are fighting in Afghanistan, without reference to the Armed Forces Pay Review Body, a breach of the military covenant?
The Prime Minister
It is this Government who doubled the operational allowance, which is the best way to get money to the privates and the corporals in Afghanistan who are doing such a good job. The operational allowance, being a flat cash sum, is of disproportionate benefit to relatively low-paid people in the armed forces, whereas obviously a percentage increase would mean more money for the generals, the colonels and the brigadiers, rather than for the people on the front line. Looking at the operational allowance is crucial, but this Government have not just done that. We have extended the pupil premium to forces children, we have increased the council tax rebates for those who are serving, and for the first time we have written the military covenant into the law of our land.
Chris Kelly (Dudley South) (Con)
Q9. I commend my right hon. Friend for protecting our national interest by exercising the veto last Friday. The people of Dudley South thank him for it. The deal that he vetoed commits eurozone members to restricting structural deficits to below 0.5% of GDP. Did the Prime Minister appreciate that this is 16 times the UK structural deficit left by Labour?
The Prime Minister
My hon. Friend makes a good point, which is perhaps why the leader of the Labour party is struggling so much to tell us what his view is on the proposed treaty. On one hand he wants to join the euro, if he is Prime Minister for long enough, and on the other hand he wants to sign a treaty—[Interruption.] That is rubbish? He does not want to be Prime Minister for long enough! He wants to join the euro, he wants a deal with very tough budget deficit limits, and he wants to increase spending, borrowing and debt. He tells us that he has a five-point plan, and I can sum it up in five words: “Let us bankrupt Britain again.”
Thomas Docherty (Dunfermline and West Fife) (Lab)
Q10. Perhaps the Prime Minister could tell us why the Deputy Prime Minister did not support his position on Europe on Monday, and why not one single Liberal Democrat MP voted with the Prime Minister last night.
The Prime Minister
Last night there was something of a parliamentary rarity: a motion tabled by an opposition party praising the Prime Minister. I am very grateful to colleagues in the Democratic Unionist party. I suspect that many people concluded that Labour simply would not get its act together and did not think that it was worth voting, and as a result we won very easily.
Richard Drax (South Dorset) (Con)
I am sure that the whole House will join me in thanking a remarkable man who has served this country and this place with courage and distinction for nearly 50 years. Eddie McKay, who is in the Gallery right now, has been a Doorkeeper here for 23 years and retires on Tuesday. Before coming to this place he served with distinction with the Scots Guards, leaving after 23 years of service as a senior warrant officer. In the Household Division, you are not promoted to drill sergeant unless you are exceptional. He saw action on Tumbledown mountain during the Falklands war in 1982. His company, G company, 2nd Battalion Scots Guards, led that successful and audacious night assault. May I ask the Prime Minister, on behalf of us all, to wish Drill Sergeant Eddie McKay a happy retirement and a happy Christmas?
The Prime Minister
I thank my hon. Friend for raising this issue and, on behalf of the whole House, very much thank Eddie for his incredible service. I think that in this House we sometimes take for granted the people who work so hard to keep it working and keep it going, and I sometimes wonder what they think of all the antics we get up to in this House. We are incredibly grateful that he, after the incredible service he gave our nation, came here and worked so hard for so many years. We are all in his debt, and send him good wishes for his retirement.
Mr Kevin Barron (Rother Valley) (Lab)
Q11. Youth unemployment figures published this morning show that in the last quarter, 22% of 16 to 24-year-old economically active citizens are unemployed—an increase of 1.2% on the previous quarter. The Prime Minister ranted earlier in Question Time about what the Government are doing about youth unemployment in this country. Can he tell us why it is increasing?
The Prime Minister
Every increase in youth unemployment is unacceptable—[Interruption.] I will tell the House exactly what is happening. The number of 16 to 18-year-old young people not in employment, education or training is actually going down, but the problem, as the hon. Gentleman rightly says, is that 18 to 24-year-olds are finding the job market extremely difficult. [Hon. Members: “Why?”] The reason why unemployment is going up is that we are losing jobs in the public sector and not growing them fast enough in the private sector, so we need to do everything we can to get our economy moving. The absolute key to that is keeping our interest rates low. We now have interest rates down to 2%. If we followed his party’s policy of extra spending, extra borrowing and extra debt, interest rates would go up, more businesses would go under and we would not get our economy moving.
George Eustice (Camborne and Redruth) (Con)
Q12. Many Members will have encountered examples of banks using the threat of receivership to extract new charges and higher interest rates from their business customers. Does the Prime Minister agree that it is wrong for banks to use what is effectively an extortionate bargaining position in this way, and will he agree to meet me to discuss some of the proposals I have outlined to limit the power of receivers and require banks to obtain a possession order before selling up small businesses?
The Prime Minister
I am very happy to meet my hon. Friend about this issue. It is vital that we not only get our banks lending properly, and lending to small businesses, but ensure that they behave in an ethical and proper way as they do so. We are addressing the first issue—the quantity of lending—through the national loan guarantee scheme and the other credit-easing measures that the Chancellor set out in the autumn statement, but we also need to ensure that the practices that the banks follow are fair, and seen to be fair. They have an interest in making sure that small businesses are in good health, and they need to follow those sorts of procedures to ensure that that happens.
Mr Russell Brown (Dumfries and Galloway) (Lab)
Q13. Youth unemployment in Dumfries and Galloway has risen by 65% over the past 12 months, and with the British Retail Consortium indicating that almost one in three jobs there are filled by under-25s, does the Prime Minister recognise that the predicted squeeze on the retail sector will only increase the chances of youth unemployment increasing across the entire country?
The Prime Minister
The thing that would put the biggest squeeze on the retail sector is interest rates going up. Just one percentage point increase in interest rates would see the typical family lose £1,000 a year through extra mortgage payments. Everybody knows we are in a difficult economic situation and we have to take difficult decisions, as there is effectively a freeze across the eurozone, but the most important thing is to keep those interest rates low, so that people have money in their pockets and we can see some good retail recovery.
David Rutley (Macclesfield) (Con)
Q14. East Cheshire hospice and many other hospices across the country run Christmas tree collection services that help many families to recycle their Christmas trees in an environmentally sensitive way. Will the Prime Minister join me in this festive season in supporting the great work that such charities do in collecting trees to raise hundreds of thousands of pounds for the important work of our hospices?
The Prime Minister
I certainly join my hon. Friend, at this time of year, particularly, in praising the amazing work that hospices do. Many hospices do not receive a huge amount of Government funding, and they have to be very ingenious about how they raise money from people up and down the country. Collecting and recycling Christmas trees so that we do not just leave them outside the house but do this thing properly is an excellent idea. I am sure that the whole House will want to join me in praising the work that hospices do, particularly at Christmas time.
John Cryer (Leyton and Wanstead) (Lab)
Q15. For the past 18 months the Prime Minister has been promising legislation to create a register of lobbyists, but nothing has happened so far. Will he give us a publication date for a consultation paper leading to legislation—or could he take on my ten-minute rule Bill, which is already published? I am a generous sort of bloke, so he can have it now and get it on to the statute book.
The Prime Minister
I am a generous sort of bloke too, so I can tell the hon. Gentleman that the lobbying proposals will be published within the next month—so this Government will have moved faster in 18 months than the previous Government did in 13 years.
Mr Adrian Sanders (Torbay) (LD)
The Prime Minister will have seen the news this morning of the study on the excess deaths of people with diabetes—unnecessary deaths, if the condition is treated correctly. The national service framework for diabetes comes to an end in 2013. Will the Prime Minister look at NSFs as a way of meeting the challenges in the health service and the health service budget, and helping people with diabetes?
The Prime Minister
I am very happy to look at the national service frameworks, as the hon. Gentleman suggests. The key issue with diabetes is that we need to raise the profile of the condition, because many people have it and do not know they have it—but also to look at the public health issues, because the explosion in diabetes is partly due to bad diet and obesity in childhood. We need to address those issues; otherwise we are always going to be dealing with the disease rather than trying to prevent it.
Mr Speaker
I am in a generous mood too, and it is always a delight to listen to my colleagues, so we will have a little more.
Mrs Anne McGuire (Stirling) (Lab)
Earlier this week in the other place, the coalition Government voted down, by a majority of two, a proposal to protect the benefits of disabled children. Is reducing benefits for disabled children by over £1,300 a year something that reflects the Prime Minister’s often repeated mantra that we are all in this together?
The Prime Minister
First of all, we are not cutting benefits for disabled children. Actually, we are uprating all those benefits by 5.2%, so people will see an increase in the benefits that they receive next year.
Mr Brian Binley (Northampton South) (Con)
The Prime Minister will be aware that capacity levels on the west coast main line are intolerable and getting worse. Does he share the concerns of rail users that delays to High Speed 2 will only make their journeys more unpleasant? Will he provide the assurance that they seek about the future that he promised them?
The Prime Minister
I am grateful to my hon. Friend for raising that question. Clearly the country has a choice. Because the west coast main line is as congested as it is, we need to replace it with either a traditional line or a high-speed line. It is well known that the Government’s view is that a high-speed line is the right answer. That is why the consultation has been conducted. Not only will it be good for people who use the west coast main line; it will be a successful regional policy that will link up our great cities, shrink the size of our country and ensure that all parts of the country can enjoy economic prosperity and growth.
Mr Speaker
I appeal to right hon. and hon. Members who are leaving the Chamber to do so quickly and quietly so that we can all listen attentively to the Secretary of State for Environment, Food and Rural Affairs—preferably facing the House or the Chair.
Park End Community Centre (Middlesbrough)
Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab)
The petition states:
The Petition of residents of Park End, Middlesbrough,
Declares that the Petitioners are concerned about the prospective closure of Park End Community Centre, which recently received £102,000 in lottery grant funding for a multi-games court, a skate park and a garden; that the Petitioners believe that this is a much-treasured community facility used regularly by residents of all ages and that the Petitioners are concerned that the closure of the centre will also have a negative impact on staff and users of the nearby Park End Medical Centre.
The Petitioners therefore request that the House of Commons urges the Government to ask Middlesbrough Council to ensure that funding for Park End Community Centre remains in place and that the centre remains open.
And the Petitioners remain, etc.
[P000989]
BAE Systems (Humber Region)
Diana Johnson (Kingston upon Hull North) (Lab)
I rise to present a petition of 4,385 constituents and others from the Humber area against the proposed loss of 899 skilled private sector jobs at BAE Systems in Brough. While Members will be enjoying the Christmas break, Boxing day will see BAE Systems complete a consultation process on the loss of strategically vital defence jobs in a region badly hit by unemployment and a shortage of decent jobs, as we saw again in today’s jobless figures. Over 100 of the workers met the Prime Minister and the Leader of the Opposition today. We hope that this leads to an outcome that will save as many of the jobs as possible.
The petition states:
The Petition of residents of Humberside,
Declares that the Petitioners support workers at BAE Systems in Brough in their fight to save Humber jobs.
The Petitioners therefore request that the House of Commons urges the Government to support the defence industry by investing in modern manufacturing and regeneration around the Humber and to preserve skilled jobs and apprenticeships in the Humberside area.
And the Petitioners remain, etc.
[P000990]
Hinkley Point
Tessa Munt (Wells) (LD)
I rise to present the petition of the Stop Hinkley campaign. Those who live in the area around Hinkley, particularly in Somerset, would like the Government to look at alternatives to Hinkley Point.
The petition states:
The Petition of supporters of the Stop Hinkley campaign,
Declares that the Petitioners strongly oppose the plan by EdF (Electricite de France) to construct a new nuclear power station at Hinkley Point in Somerset and declares that as an alternative, the Petitioners believe that a Government-backed programme of energy saving and clean renewable energy would combat climate change and avoid the risks of catastrophic accidents and dangers to health resulting from the storage of highly radioactive waste at Hinkley for 160 years.
The Petitioners therefore request that the House of Commons urges the Government to commit to an energy policy based on energy saving and clean renewable energy, in which new nuclear power stations play no part.
And the petitioners remain, etc.
[P000991]
Bovine TB
(13 years ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Secretary of State for Environment, Food and Rural Affairs (Mrs Caroline Spelman)
Today I am setting out the next stage in the bovine tuberculosis eradication programme for England.
Bovine TB continues to be a major problem in England. In 2010, nearly 25,000 cattle were slaughtered in England and the cost to the taxpayer is set to top £1 billion over the next 10 years. The problem is particularly bad in the west and south-west of England, where 23% of cattle farms were unable to move stock off their premises at some point in 2010 due to their being affected by the disease, causing much distress and hardship.
As I explained in my statement in July, cattle measures, including routine testing and surveillance, pre-movement testing, movement restrictions, and the removal and slaughter of infected animals, remain the foundation of our TB eradication programme. We have already strengthened cattle controls and will continue to do so. The Government are working in partnership with the farming industry and the veterinary profession to further promote good biosecurity and to provide advice and support to farmers. We also intend to invest a further £20 million over the next five years to develop effective cattle and oral badger vaccines as quickly as possible.
We know that to tackle this disease we need to look at each and every transmission route, and that includes transmission from badgers to cattle. Ultimately, we want to be able to vaccinate cattle and badgers, but there are practical difficulties with the injectable badger vaccine, which is currently the only available option. Badgers have to be trapped and caged in order to administer it. As I told the House in July, we are working hard to develop a cattle vaccine and an oral badger vaccine, but usable and approved vaccines are still years away and we cannot say with any certainty when they will be ready. In the meantime, we cannot just do nothing.
This terrible disease is getting worse and we have to deal with the devastating impact it has on farmers and rural communities. It is difficult to quantify or put a monetary value on that, but a report by the Farm Crisis Network describes the feelings of panic, stress and emotional devastation for farming families as they repeatedly have to send their cows to be slaughtered.
I think that we would all agree that we need to stop the disease spreading further, bring it under control and ultimately eradicate it. Evidence tells us that unless we tackle the disease in badgers, we will never eradicate it in cattle. No country in the world that has TB in its wildlife has been able to eradicate it in cattle without addressing it in the wildlife population. In July, I set out revised proposals for controlling the disease in the badger population. In order to reduce TB in cattle in the worst affected areas we proposed to allow a controlled reduction carried out by groups of farmers and landowners, as part of a science-led and carefully managed policy of badger control. The policy would be piloted in two areas in the first year.
Following the responses to the consultation that we launched in July on draft guidance to Natural England, the policy has been further refined. I am now in a position to announce that we will go ahead with a pilot of the policy in two areas next year, to confirm our assumptions about the effectiveness, humaneness and safety of controlled shooting. An independent panel of experts will oversee and evaluate the pilots and report back to the Government, and we will then decide whether the policy should be rolled out more widely.
This has not been an easy decision to make, and it is not one that I have taken lightly. I have personally considered all the options and evidence, and at present there is no satisfactory alternative. Today, I am publishing a detailed policy document, copies of which will be available in the Vote Office after the statement. We need to strike a balance between taking the actions needed to control and eradicate the disease, maintaining a viable cattle industry and using our resources in the most effective and efficient way possible.
Badger control licences will be issued by Natural England under the Protection of Badgers Act 1992, to enable groups of farmers and landowners in the worst-affected areas to reduce badger populations at their own expense. Guidance to Natural England sets out strict criteria that applicants for a licence will have to meet to ensure that the pilots are carried out safely, effectively and humanely.
Scientists agree that if culling is conducted in line with the strict criteria identified through the randomised badger culling trial, we can expect it to reduce TB in cattle over a 150 sq km area, plus a 2 km surrounding ring, by an average of 16% over nine years relative to a similar unculled area.
Licences granted by Natural England will be subject to strict conditions based on evidence from the randomised badger culling trial, which are designed to ensure that the result is an overall decrease in the disease in the areas where culling takes place. Applications for licences will be considered only for an area of at least 150 sq km over a minimum of four years, and with the pilots to be conducted by trained and proficient operators. Groups of farmers will have to take reasonable measures to identify barriers and buffers at the edge of culling areas such as rivers, coastlines and motorways, or areas where there are no cattle or where vaccination of badgers occurs, to minimise the perturbation effect in places where disturbing the badger population could cause an increase in TB in cattle in the surrounding area.
The Department has assessed the known and estimated effects of badger culling and vaccination, and its veterinary and scientific advice is that culling in high TB incidence areas, carried out in line with the licence criteria, will reduce the number of infected badgers, and thus the weight of TB infection in badger populations in the treatment area, more quickly than vaccination. It will therefore have a greater and more immediate beneficial impact on the spread of TB to cattle and the incidence of infection in cattle.
Nevertheless, we still see a useful role for vaccination, particularly in the future, and I have listened carefully to the views of groups that would like to help develop a vaccination programme. To support and encourage vaccination, DEFRA will make available up to £250,000 in each of the next three years to help meet the costs of badger vaccination in accordance with a badger control plan, with priority given to areas where culling is licensed. We will also support staff or volunteers of voluntary sector organisations wishing to train to carry out vaccination.
I look to the farming industry to show that it takes its responsibility very seriously and that it is committed to delivering the programme effectively, safely and humanely. That will be carefully monitored in the pilots, and on an ongoing basis if the policy is rolled out more widely.
To select the pilot areas, I will invite the farming industry to bring forward a shortlist of areas, from which DEFRA will select two. Those two areas will then be invited to apply for a culling licence. Natural England will assess the applications against the licence criteria and decide whether to grant them a licence.
After the conclusion of the six-week pilots, from what we observe and learn, and taking into account the evaluation by the independent panel, we will take a decision on whether to roll out the policy more widely. Following the pilots, if we decide to proceed with a wider roll-out, a maximum of 10 licences will be granted to start each year.
Ensuring public safety is a key concern. In finalising the policy, we have worked closely with the Home Office and the Association of Chief Police Officers to scope out the role of the police in supporting those licensed operations.
I know that there is great strength of feeling on the issue, but I also know that we need to take action now before the TB situation deteriorates even further. We need to tackle TB from all angles, using all the available tools. I am acutely aware that many people oppose badger culling and I wish that there was a current satisfactory alternative. However, we cannot escape the fact that the evidence supports the case for a controlled reduction of the badger population in the areas worst affected by bovine TB. The impact of that terrible disease shows us that we need to act now. We cannot keep delaying.
In making the decision, I have considered all the evidence and have listened to the full range of views. Having listened to all sides of the debate, I believe that this is the right approach.
Mary Creagh (Wakefield) (Lab)
We recognise that bovine TB is a devastating disease—that is why the Labour Government spent £50 million on randomised badger culling trials. Any decision on a badger cull must answer four key questions. Is it science-led? Is it cost effective? Is it humane? Crucially, will it work?
The independent scientific group on cattle TB, which reported on Labour’s trial culls, stated:
“After careful consideration of all the RBCT and other data presented in this report… we conclude that badger culling cannot meaningfully contribute to the future control of cattle TB in Britain.”
The Secretary of State quotes scientists who told the Government that TB in cattle will be cut by 16% over nine years if the cull is carried out by trapping and then shooting the animals. However, her culls will not be carried out in that way. They will depend on farmers hiring people to free-shoot badgers at night—a method that has never been scientifically assessed as a way of controlling bovine TB.
Perturbation occurred in the first three years of Labour’s trial culls when badgers were humanely captured. What scientific advice has the Secretary of State sought or received on the likelihood of free shooting increasing the perturbation effect, which will reduce that 16% net figure still further?
Is the cull cost-effective? The right hon. Lady’s statement was curiously silent on the costs to farmers, yet DEFRA estimates that it will cost farmers £1.4 million per cull area. Farmers will need to prove they have the funds to complete the cull in the event that one pulls out or sells up. How will she access those funds in the event of a default? Who will access those funds, and on what basis? How will the money be held—in an escrow account or in joint names? How will liability be shared between farmers?
What guarantees can the Secretary of State offer taxpayers that the costs of completing a four-year cull will not fall on them in the event of those indemnities disappearing or becoming the subject of protracted legal wrangling? How many staff will the right hon. Lady need to issue those cull licences? What is the cost to the taxpayer of hiring those extra staff at Natural England, a body that has shed nearly 500 staff since her disastrous settlement in the comprehensive spending review?
We know that the Home Secretary has warned the Secretary of State against proceeding with the cull. Will she confirm that the culls will not start until the Olympic games are over? Will she confirm today that trained firearms police will be needed to police any public protests against the culls?
In the Secretary of State’s 2010 consultation, she estimated the costs to the police at £200,000, yet today’s report has revised those costs up to £2 million per cull area. If 10 cull areas are licensed every year, that is a compound cost of £20 million a year to the police. Will she confirm that DEFRA will meet those costs in full? If so, from which budget, given that the Department has had a 30% cut? How will local police forces access those funds?
In written answers to me, the right hon. Lady estimates that the cull will save the taxpayer £2.9 million in each cull area over 10 years. With 10 cull areas set to go ahead from 2013, that is a saving of £2.9 million a year, which is just 3% of the £85 million cost of testing and compensation to farmers. Will she therefore confirm that the costs of bovine TB will continue to be borne by the taxpayer?
The third question the Secretary of State must answer is this: is her cull humane? In 2010, 48 people were prosecuted for offences against badgers and 29 were found guilty. The police wildlife crime unit is concerned that illegal badger persecution will be carried out under the pretext of culling. Who will monitor cull licences and how will the conditions of the licence be monitored? She mentioned a six-week cull period, but how can she ensure that farmers will not go beyond that?
Between 60,000 and 120,000 badgers will be killed over a four-year period depending on the number and size of cull areas, yet in the Secretary of State’s statement, she curiously failed to mention the new national badger count announced this week, which will cost £871,000. Surely she should have commissioned that survey before announcing her pilot culls. How can we measure the impact of a cull on the badger population when we have no scientific baseline? What measures is she taking to prevent the extinction of badger populations in cull areas, and how will she ensure we remain in compliance of our international obligations under the Bern convention?
Finally, will it work? The scientific group warned that
“several culling approaches may make matters worse”.
Is not the Secretary of State in danger of sleepwalking into a disaster by licensing badger culls, the method of which is unproven and untested, and which could make things worse? The Government have constructed the ultimate game theory test for farmers in TB-hit areas: join in the cull or face increased TB in the herd from badger perturbation. How will the views of farmers and landowners in areas affected by perturbation be collected and considered? What happens to farmers who do not wish a cull to proceed on their land? How will the Secretary of State ensure the health and safety of the people carrying out the cull and disposing of infected carcases, the police firearms officers policing the cull and the protesters who will undoubtedly turn up at cull sites?
Today’s announcement is bad news for wildlife, bad news for farmers and bad news for the taxpayer. The cull will not be cost-effective or humane and it will not work. In “Yes, Minister”, Jim Hacker said: “Something must be done. This is something. Therefore we must do it.” Today the Secretary of State has turned her back on the scientific advice. Page 11 of her own document states:
“It is a matter of judgement, not science, whether the farming industry can deliver an effective, coordinated and sustained cull.”
I hope she has got everything crossed.
Mrs Spelman
The hon. Lady asked a lot of questions so I will answer them as quickly as I can. First, I should point out that this is a science-led approach to the pilots and that when in office the previous Labour Government spent £50 million on trials. The science is important and this Government have responded to what was learned from those trials. We learned that culling could be more effective if the boundaries of the control area were firm ones, to reduce the perturbation effect. In addition, the ground she cited—she said that the cost would be prohibitive—overlooks that fact that the farmers have agreed to pay. I encourage the shadow Secretary of State to look at the long tail from that trial. Five and a half years after the analysis, the trial continues to provide a benefit in reduced TB incidence in those areas.
The method to which the hon. Lady referred—controlled shooting—is commonly used to control other wildlife populations, such as deer, foxes and rabbits. We therefore have reasonable confidence in our assumption that the method will be both effective and humane in relation to badgers, but, to be absolutely clear, those who undertake the culling will be required to have deer-stalking level 1 proficiency or equivalent, and they will be required to undertake an additional course to ensure that they understand badger physiognomy.
On cost-effectiveness, in the end, it is up to farmers to choose whether or not to be part of a controlled reduction of badgers in their area, but the Government make a requirement that groups of farmers form a limited company that puts aside in a bank account the four-year cost of the culling programme plus a 25% contingency, which deals with the hon. Lady’s point about the contingency cost.
Natural England’s existing staff will contribute to the programme. The overall cost to the Government of £6.22 million over 10 years must be seen in comparison with the overall cost of the unchecked progress of the disease, which will be £1 billion a year or more to the taxpayer over the next 10 years. The costs need to be seen in the context of the overall burden on the taxpayer.
I have had helpful and constructive conversations with the Association of Chief Police Officers, but it is up to the police to deal with the precise operational details of ensuring public safety throughout the pilot process. We should not simply extrapolate an estimated cost from the pilots, as, I am afraid, the hon. Lady just did. Part of the point of the pilots is to establish more precisely what the exact cost will be. I have agreed with the Home Office to share those policing costs in so far as additional and reasonable costs are incurred.
On humaneness, we can be assured that Natural England will monitor the cull licences very carefully. If any farmers should be so minded to exceed the six-week period, they would obviously lose their licence. I do not believe, therefore, that that will happen.
It is important to remember that the species is protected but not endangered. The last time the population was surveyed—in the 1990s—there were between 250,000 and 300,000 badgers in Great Britain. Of course, the previous Labour Government had ample opportunity to launch a survey if they had wanted to, but this Government have seen fit to do so. That is important in ascertaining the population in the controlled areas. We have satisfied ourselves that the Bern convention would not be breached by the policy that I have proposed.
Finally, I agree with the hon. Lady on this point. She said that a matter of judgment and not the science alone drives this decision. If the previous Government had exercised their judgment and acted when they had the chance, the disease, and the cost of dealing with it, would not have escalated to the point it has reached today.
Miss Anne McIntosh (Thirsk and Malton) (Con)
Farmers and wildlife conservation groups will welcome the statement. The badger population must be controlled. Any constituency that produces so many cattle, including mine, lives in fear of one rogue animal entering the chain.
Will the Secretary of State address what the position will be when we have a vaccine in place, given that the meat of vaccinated cattle will not be allowed into the food chain? We have the time to address that. Will she bear in mind the conclusions of the Select Committee on Environment, Food and Rural Affairs report adopted in the previous Parliament, by which current members of the Committee stand?
Mrs Spelman
My hon. Friend is singularly well qualified with her experience in the European Parliament to know how difficult it is to get the law changed there. It is currently illegal to vaccinate cattle and to sell or export that meat. We would have to get the 26 other member states to agree to a change in the law. We must accept that that would take many years.
Mr Ben Bradshaw (Exeter) (Lab)
Will the Secretary of State be clear with the House about what level of mortality she expects shooting to achieve, because the very clear advice that we received over many years as Ministers was that shooting would not achieve a level of mortality high enough to make any difference to the disease at all? She is allowing only a very short six-week period for the pilots, which cannot be credible.
Mrs Spelman
The science determines the level of mortality that must be achieved for the controlled reduction to be effective, and a 70% reduction in the badger population is what the RBCT trial showed had to be achieved. One key point of the six-week pilot is to confirm our assumption that controlled shooting will achieve that level of reduction in the badger population.
Andrew George (St Ives) (LD)
My right hon. Friend is absolutely right to say that this is a devastating disease. We must hope that this policy will help and not make the situation worse. In the implementation of the culling policy, how will she ensure that there is a proper and rigorous estimate of the badger population and also that there is a proper count of those badgers that are culled within the area and not outside it?
Mrs Spelman
I commiserate with my hon. Friend because his part of the country has been the most badly affected by this terrible disease. Natural England will carry out a survey of the badger population before any culling takes place and will also check that the percentage of badgers culled fits the criteria set out in the pilot.
Paul Flynn (Newport West) (Lab)
Should not the clarion call go out from this House today to all the right-thinking, compassionate people in this country to frustrate this cruel and unnecessary slaughter of animals? Is it not right that this has been founded on greed and bad science by the nasty party?
Mrs Spelman
I hope that an hon. Member is not calling on the public to break the law; that would be very unwise.
Sarah Newton (Truro and Falmouth) (Con)
The compassionate people in my constituency will very much welcome the great thought, care, attention and bravery of the Secretary of State and her team in tackling this issue. I particularly welcome the investment by the Government in the voluntary trials for vaccination. Perhaps the Secretary of State could give us a bit more information about them, because, ultimately, those trials are what we all want to see.
Mrs Spelman
As I have said, this is a difficult decision and it is not one that I have found easy to make. Having spoken and listened to all the stakeholders involved, I understand that the cost of training someone to take part in the vaccination programme is significant, so I hope that with the money that I have announced today, we will be able at least to halve the cost of that training.
Caroline Lucas (Brighton, Pavilion) (Green)
Rather than pursuing this cruel and counter-productive cull, what consideration did the Secretary of State give to reducing the trend towards increasing intensive dairy farming? Around 80% of bovine TB transmission is thought to be caused cattle to cattle and that happens far more easily in crowded conditions.
Mrs Spelman
I am sorry to say that the hon. Lady is misguided in thinking that there is a link between the intensification of dairy farming and the incidence of TB in cattle. There is no evidence of that.
Mr James Gray (North Wiltshire) (Con)
Farmers across North Wiltshire, many of whom have been devastated by TB and have lost their herd some two or three times, will very much welcome the Secretary of State’s announcement today and will hope to be a part of the first 10, or even first two, trials. However, is she not concerned about the talk from Opposition Members about the security surrounding the cull? Is there not a risk that people will be enjoined by them and others to break the law in a way that was suggested by the hon. Member for Newport West (Paul Flynn)? Will she take steps to ensure that the precise location of the cull is not in the public domain so that such actions can be avoided?
Mrs Spelman
I have had very careful conversations with the Home Secretary and with the Association of Chief Police Officers regarding security. Like members of the public, people who are licensed to undertake a cull have every right to expect their safety to be protected. Careful analysis has been undertaken by the police and I respect their expertise and thank them for their assistance.
Kerry McCarthy (Bristol East) (Lab)
Let me follow on from the question of the hon. Member for Brighton, Pavilion (Caroline Lucas). There is nothing in this statement about dealing with the problem of cattle-to-cattle transmission. All the evidence shows that that is a significant factor in spreading bovine TB. What does the Secretary of State plan to do about that? It seems that the only solution on offer is shooting badgers.
Mrs Spelman
I refer the hon. Lady to the statement that I made in July, setting out the other important elements of the bovine TB package, of which controlled reduction of the badger population is just one part. We have strengthened measures on controlling the movement of cattle and expanded the areas for the testing of cattle. I know that that was very much wanted by the industry. As a west midlands MP, my farmers came to me and said that they would prefer to be part of the annual testing because they want to know more frequently whether their cattle are clear. In my July statement, all those strict measures were cited.
Dr Sarah Wollaston (Totnes) (Con)
The year after Labour came to power, fewer than 600 cattle were slaughtered in Devon. This year, we are well on course for more than 6,000 to be slaughtered. Bovine TB is spreading remorselessly across the UK and many areas of the country will no longer be disease free unless we take action, so I welcome the Secretary of State’s statement today. However, does she not share the concerns of farmers in my constituency who feel that they could be targeted by violent activists? Will she assure them that those who carry out this very difficult task will have their anonymity protected?
Mrs Spelman
The whole House respects my hon. Friend’s medical expertise, and she is right to point out that the disease has spread—it has spread from the south-west to the midlands. That fact demonstrates that doing nothing is not an option. As for her important point about personal information, I can assure her that, in the interests of personal security, personal information will be kept confidential.
Ian Paisley (North Antrim) (DUP)
I should declare that I am a member of the British Veterinary Association, which I know will welcome the right decision at the right time under the right circumstances following the right evidence to get the right conclusions. I welcome the Secretary of State’s statement and the fact that her Department has stuck to its guns on this issue. It is important that we reach a solution. I welcome the conclusion of the report that the reduction of the incidence of TB in cattle will be achieved if we follow this licensing procedure. I hope that the Secretary of State will ring the Ministers in the devolved regions and encourage them to follow these actions. We need to put in place a scheme such as this in Northern Ireland.
Mrs Spelman
I assure the hon. Gentleman that we are in close contact with other devolved Ministers. We should of course remember that Scotland is TB-free and would like to remain so. I hope that our policy will give it some comfort in that matter. I have taken the veterinary advice very seriously. It is the vets who point out that no programme of eradicating TB anywhere in the world has been successful without tackling the reservoir infection in the wildlife.
Sheryll Murray (South East Cornwall) (Con)
I know that farmers in South East Cornwall will welcome this news. Alpaca farmers will welcome it, too. Is the Secretary of State aware that bovine TB has been affecting alpaca herds as well as cattle herds?
Mrs Spelman
Sadly, there is no satisfactory test for TB in camelids, which includes alpacas, and that is a source of considerable concern. We will continue to work on that. Alpacas are included in our programme of trying to manage and control this disease.
Sheila Gilmore (Edinburgh East) (Lab)
No one is suggesting that bovine TB is not a problem. However, why does the Secretary of State believe that what she proposes will work given the scientific conclusions of a 10-year pilot by the previous Government?
Mrs Spelman
When a programme of badger control was part of the original randomised badger culling trial, the science showed a clear reduction within the controlled area, and an impact on the edge of the area. We have proposed to build on that science base and grant licences to areas with more firmly controlled boundaries to reduce the perturbation effect. It is indisputable that the original trial saw, on average, a 16% reduction in the incidence of TB in cattle herds.
Dan Rogerson (North Cornwall) (LD)
The Secretary of State has quite rightly set out the sad decision that has had to be taken on this issue. She has also made it clear that the decision is based on the scientific evidence that was provided by the trials. Ongoing monitoring has shown there to be a lasting effect and that perturbation is only temporary. None the less, there will be those who, understandably, will have an emotional response to this issue. They may be inflamed by people in this House and elsewhere who are somewhat removed from the problem. Will she undertake to carry out as much publicity as she can and to work with organisations such as the British Veterinary Association to make the case for those who have an instinctive response and have not had the opportunity to consider the issues?
Mrs Spelman
The hon. Gentleman makes an important point. I understand that this issue excites strong emotions, but for those who feel strongly about it I point to the Farm Crisis Network report, which shows the devastating emotional cost to the farmers who lose their cattle. It is probably right at this point to pay tribute to the work done by Adam Henson and “Countryfile” to make members of the public more aware of the cost to farmers of the slaughter of their animals as well as of the impact on wildlife.
Hywel Williams (Arfon) (PC)
The Secretary of State will know that the previous Welsh Government had intended a cull but the current Welsh Government appear to have had a change of mind. Has she discussed the reasons behind that change of mind with the Welsh Government? Furthermore, will she discuss the contents of her statement with the Welsh Government, given the substantial trade in cattle between England and Wales?
Mrs Spelman
Yes, I can give that assurance to the hon. Gentleman. The Minister of State is in regular contact with the Agriculture Minister. We meet regularly at Agriculture and Fisheries Council meetings that I invite the devolved Ministers to attend and at which we have ample opportunity regularly to share our approach to the control of TB. I shall have that opportunity at the Agriculture and Fisheries Council tomorrow.
Neil Parish (Tiverton and Honiton) (Con)
May I welcome the Secretary of State’s statement, which is absolutely right for the farmers in my constituency whose cattle have suffered from this disease for many years? You have made the right decisions. If you tackle the disease in the wildlife, you stop it reinfecting the cattle every year, which is what has been happening for years. I thank you very much for acting on that. The only way they tackled the disease in New Zealand and Australia was by tackling it in wildlife.
Mr Speaker
I am most grateful for the hon. Gentleman’s gratitude, but I think he will intend me to redirect it to the Secretary of State.
Mrs Spelman
My hon. Friend makes a very important point. In New Zealand, the incidence of the disease in possums had to be tackled; in Australia, it had to be tackled among wild buffalo; and in Ireland, it was tackled in the badger population. No part of the world has successfully tackled TB in its cattle population without addressing the reservoir of disease in wildlife.
Nic Dakin (Scunthorpe) (Lab)
The wildlife trusts have said that the scientific evidence does not support the culling of badgers and could even make matters worse by disturbing the remaining badgers, spreading the disease further. How will the Secretary of State ensure that these short six-week pilots get the evidence base to demonstrate whether the wildlife trusts are right or wrong in their suppositions?
Mrs Spelman
I really must nail this point about the science. The science shows that if the badger population is reduced by 70%, TB incidence is reduced by 16%. That is what the original trial shows and we cannot get away from those facts. The judgment is whether the proposed method of controlled shooting will achieve that and that is the point of piloting it.
John Glen (Salisbury) (Con)
The farmers of south Wiltshire and around Salisbury will warmly welcome today’s announcements. Will the Secretary of State confirm that these new provisions will be kept under review to ensure that they are successful in tackling this terrible disease? If they are seen to be successful, will moves be made to extend them as soon as possible so that everyone can have the benefit of the trials?
Mrs Spelman
As I made clear, the two trials that will take place next year—probably at the start of the autumn—will cover a six-week period, after which we would expect the evaluation of those trials to take approximately another four weeks. The evaluation will be undertaken by an independent panel, the composition of which will be announced in the new year. Of course, we will keep that under very close review, as we will all the parts of our package of proposals to eradicate TB.
Thomas Docherty (Dunfermline and West Fife) (Lab)
May I press the Secretary of State to say a little more about these trial areas of 150 sq km? Will all the landowners within that trial area have to sign up? If they do not, will the shooters be allowed to go on to their property to shoot?
Mrs Spelman
What is required for the pilots is access to 70% of the land, in line with the evidence from the randomised badger culling trial. We need access to 70% of the land. There is no element of compulsion on all landowners in the area, but 70% is needed as part of the limited liability company that a group of farmers would set up.
Roger Williams (Brecon and Radnorshire) (LD)
I draw Members’ attention to my entry in the Register of Members’ Financial Interests. Today—this very day—cattle will be taken from the farm for which I have responsibility to be shot, because they were found to be reactors last week. I welcome the Secretary of State’s courageous announcement following the incisive scientific analysis by David King, but will she also insist that farmers play their part in maximising biosecurity and following all the regulations on testing and movement, too, so that we can maximise the effect of the announcement?
Mrs Spelman
I commiserate with the hon. Gentleman on the loss of those cattle. The front page of the Farm Crisis Network’s report brings home to anyone who has not experienced that what it feels like. One farmer said:
“I feel there is a constant dark cloud of uncertainty over me, causing stress, anxiety and fear.”
I am sure that the hon. Gentleman identifies with him. I assure him that all aspects of the bovine TB package, including strengthening biosecurity measures, will be available. It is a full toolkit to tackle this terrible disease.
Glyn Davies (Montgomeryshire) (Con)
The impact of bovine TB is as devastating to farmers, cattle and wildlife in Wales as it is in England, but the control of the disease in Wales is devolved to the Welsh Government. Will my right hon. Friend reassure me that all the evidence, experience and information available to her will be shared with the Welsh Government so that the issue can be dealt with in Wales, too?
Mrs Spelman
I can give that assurance. Of course, we will share with devolved Ministers all the evidence and experience from the two pilots as well as from the wider package.
Bob Blackman (Harrow East) (Con)
Will my right hon. Friend confirm that there will be a requirement, particularly in the pilots, for a strict count of the number of badgers culled, that there will be a requirement for those badgers to be tested to substantiate that they are suffering from TB and that in the long term, there will be a requirement that those areas that are going through vaccination will not also have culling at the same time?
Mrs Spelman
I can give my hon. Friend that assurance. Very strict requirements have been set out, and tomorrow I will publish the guidance to Natural England and he might wish to read that to see precisely how this will be controlled and how we will test the infection of badgers. On the point about coterminous vaccination and controlled reduction, it is important to remember that this is a package and the option we have chosen to pursue combines controlled reduction of the badger population with vaccination. Some parts of the area might not be suitable for one method of controlled reduction and boundaries might be secured by a programme of vaccination, too.
Guto Bebb (Aberconwy) (Con)
May I, too, congratulate my right hon. Friend on her statement, which I welcome? In view of our bitter experience in Wales with proposed trials, however, how confident is she that these proposals will not be subject to a legal challenge?
Mrs Spelman
Far from it: I think we can be reasonably confident that they will be subject to a legal challenge and that is one reason why we have taken the utmost care. We have taken our time and we have taken a precautionary approach, and every step of the way we have tried to ensure that we have a copper-bottomed reasoned analysis that is the basis of our judgment that we should proceed with this policy.
Tessa Munt (Wells) (LD)
I am aware that more than 1,200 badgers have been vaccinated over the past 18 months in Gloucestershire in trials under separate projects from the Food and Environment Research Agency and the Gloucestershire wildlife trust to assess the practical use of a vaccine. I am pleased that the new vaccine plans have been announced today and they at least explain that we are trying different solutions to sort out this problem, which is a huge one in Somerset. When will the Secretary of State be in a position to assess the effectiveness and costs involved in that project in Gloucestershire and how will that inform the planned vaccination projects that are to come over the next three years?
Mrs Spelman
It will take some time—many years—before we can finally assess the effectiveness of the vaccination trial in Gloucestershire, but I went and saw it for myself and, as much as anything, it was about the practicalities of trapping and caging the badgers prior to injecting with the only vaccine that is available. There are considerable practical difficulties with the procedure, but today I have tried to make available a fund to help those voluntary groups that want to participate in the vaccination programme.
George Eustice (Camborne and Redruth) (Con)
I welcome the Secretary of State’s proportionate and measured approach to this very contentious issue, and it will be respected by farmers in the west country, many of whom have suffered tragic losses from their herd. I welcome also the long-term commitment to developing a vaccine, but does my right hon. Friend agree that one of the problems with the current vaccine is that it will only inoculate healthy badgers against future infection and cannot cure badgers that already have the disease?
Mrs Spelman
My hon. Friend, who is very knowledgeable, has hit on the problem that the vaccine is effective only in badgers that are clear of the disease. That is one reason why vaccination takes so much longer than the method of controlled reduction by controlled shooting, but I reiterate that the Government have committed £20 million to the ongoing quest to find an oral vaccine for badgers. It has been effective in treating other diseases such as rabies, and if only we could find one, we would all, I am sure, be delighted.
Royal Assent
Mr Speaker
I have to notify the House, in accordance with the Royal Assent Act 1967, that Her Majesty has signified her Royal Assent to the following Acts:
London Olympic Games and Paralympic Games (Amendment) Act 2011
Terrorism Prevention and Investigation Measures Act 2011
Public Bodies Act 2011
Charities Act 2011.
Victims of Crime (Code of Practice)
Priti Patel (Witham) (Con)
I beg to move,
That leave be given to bring in a Bill to make provision for a code of practice to be observed by all those working in the criminal justice system setting out the rights of victims of crime and their families; and for connected purposes.
It is a privilege to address the House on a matter of profound importance to the functioning of our criminal justice system, and I am delighted that so many Members have expressed their support for this endeavour.
The Bill sets out to provide more rights and support to the victims of crime and to their families. We all know, from meeting victims of crime in our constituencies, the horrific, appalling and devastating effect that criminals have on their lives, but all too often victims and their families feel let down, unrepresented and abandoned as they are processed through the criminal justice system.
Two sets of figures highlight how scandalous and inconsistent the treatment of victims can be. The 2010-11 British crime survey shows that only 39% of victims were confident that the criminal justice system is effective, compared with 44% among non-victims, and that 56% of victims are confident that the criminal justice system is fair, compared with 63% of non-victims. In other words, once a victim goes through the criminal justice system and has experienced its workings, they believe it to be less effective and less fair, compared with the expectations of non-victims.
The treatment of victims is of even more concern when compared with the treatment of defendants and offenders. Surveys show that only about one third of people believe that the criminal justice system
“meets the needs of victims”.
By contrast, twice as many—80%—believe that the system
“respects the rights of and treats fairly people accused of committing a crime.”
That is no doubt why the former victims commissioner, Louise Casey, whose work I pay tribute to, has said that
“there is a need, if not to take away rights from offenders, to at least give consideration to ‘balancing up’ the system towards some basic needs of victims. Convicted or accused people are afforded a strong position in terms of definite ‘rights’ from the criminal justice system, whereas victims are afforded vague codes and unenforceable charters with no real route of complaint.”
The existing procedures for victims have failed and proved to be inadequate, and the victims commissioner called for a new victims law, which would include the rights for victims and their families to make statements to influence sentencing, to receive information about their case and to be given suitable support. Before Louise Casey left her post, she also called for more support and rights for the families of murder victims. It is deeply worrying that 51% of families bereaved in such circumstances have found the criminal justice system to be the most difficult issue to deal with, and that is why she called for them to receive greater rights to information, greater practical and emotional support and better treatment in the courtroom. She rightly called also for delays in releasing bodies to be overcome, so that loved ones might be buried within 28 days. Measures to introduce those recommendations and others are included in my Bill, as it strengthens the rights of victims and enshrines those rights in law.
In the time I have left, I should like to draw the House’s attention to some other issues that need addressing and are dealt with in my Bill. First, victims’ rights must be enforceable with an efficient and effective mechanism in place for them to seek and secure redress when their rights have not been respected. Offenders and defendants have a range of legal avenues available to them when they feel mistreated in the criminal justice system, including going all the way to the European Court of Human Rights, but the striking absence of a corresponding system for victims is unjust, and my Bill reverses that.
Secondly, as part of making victims the central focus of the criminal justice system, my Bill ensures that they have a genuine say over whether an offender is charged, and when a sentence is passed down once a guilty verdict is secured. Too often, victims are excluded from that process, an appalling example of which was when the police and courts let off an offender responsible for committing some 600 crimes in Essex. Instead of being put in a prison cell, he went into the community to reoffend. Needless to say, victims throughout the county were angered by the judgment and by the fact that they were excluded from the decision-making process and did not get their day in court to press for a more relevant and appropriate sentence. Under my Bill, that would not happen again.
Thirdly, as part of giving more rights to the families of homicide victims, my Bill compels authorities to offer more support to the families of British nationals murdered abroad. In recent months, two horrendous cases have come to my attention, in which constituents have suffered because of the murder overseas of those nearest and dearest to them. Not only have they had a terrible time dealing with the tragic loss, but they have had to encounter a range of practical obstacles, such as translation costs, travel arrangements and an unfamiliarity with foreign legal systems. Currently, only 13% of those families feel as though the British authorities treat them as victims, and there is a wide disparity in the support services available to them. I pay tribute to the outstanding work undertaken by the organisation Support After Murder and Manslaughter Abroad in assisting relatives faced with that tragic set of circumstances, and to its efforts to develop a memorandum of understanding with the authorities in this country. But a firm set of commitments, which my Bill provides for, is needed so that full assistance can be afforded and provided to them.
Finally, my Bill gives victims greater protection from criminals not only when the criminal is out in the community, but when they are in prison. In one shocking case in my constituency, a convicted murderer has been able from jail to torment the family of the deceased, through media articles both authorised by the Ministry of Justice and unauthorised. That cannot be right, and my Bill empowers victims in such circumstances to prevent hurtful statements by their convicted tormentors.
Those are important issues for victims in all our constituencies, and I hope that right hon. and hon. Members throughout the House will show their support by granting me leave to bring in this Bill.
Question put and agreed to.
Ordered,
That Priti Patel, Mr Philip Hollobone, Charlie Elphicke, Mr David Amess, Mr Graham Brady, Mr Andrew Turner, Mark Pritchard, Mr Graham Allen, Bob Russell, Nick de Bois, Stuart Andrew, Mark Durkan and Elizabeth Truss present the Bill.
Priti Patel accordingly presented the Bill.
Bill read the First time; to be read a Second time on Friday 27 January 2012 and to be printed (Bill 263).
Business of the House
(13 years ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
14:20 - The House having divided: - Ayes: 266 / Noes: 187 - Question accordingly agreed to.
The Parliamentary Secretary, Office of the Leader of the House of Commons (Mr David Heath)
I beg to move,
That—
1. Standing Order No. 80A (Carry-over of bills) shall be amended as follows—
(a) in line 7, after the word ‘motion’, insert the words ‘(other than a motion relating to a bill brought in upon a ways and means resolution)’, and
(b) in line 23, at end, insert the words ‘(other than a bill brought in upon a ways and means resolution)’; and
2. the following new Standing Order be made—
‘(1) The Speaker shall put any question necessary to dispose of proceedings on a carry-over motion of which a Minister of the Crown has given notice under Standing Order No. 80A (Carry-over of bills) relating to a bill brought in upon a ways and means resolution—
(a) forthwith if the motion is made on any day before the bill is read a second time, or on the day the bill is read a second time; or
(b) not more than one and a half hours after the commencement of proceedings on the motion if the motion is made at any other time.
(2) The following paragraphs of this order shall apply to any bill ordered to be carried over to the next Session of Parliament in pursuance of a carry-over motion to which paragraph (1) applies.
(3) If proceedings in committee on the bill are begun but not completed before the end of the first Session, the chair shall report the bill to the House as so far amended and the bill and any evidence received by the committee shall be ordered to lie upon the Table.
(4) In any other case, proceedings on the bill shall be suspended at the conclusion of the Session in which the bill was first introduced.
(5) In the next Session of Parliament, a Minister of the Crown may, after notice, present a bill in the same terms as the bill reported to the House under paragraph (3) of this order or as it stood when proceedings were suspended under paragraph (4) of this order; the bill shall be read the first time without question put and shall be ordered to be printed; and paragraphs (6) to (13) shall apply to the bill.
(6) In respect of all proceedings on the bill, any resolution which the bill was brought in upon in the first Session shall be treated as if it were such a resolution of the House in the next Session and any reference in any resolution upon which the bill was brought in to a Bill or Act of the present Session shall be treated in the next Session as a reference to a Bill or Act of that Session.
(7) In respect of all proceedings on the bill, the bill shall be treated as a bill brought in upon ways and means resolutions.
(8) If the bill was read a second time in the first Session, it shall be read a second time without question put.
(9) If the bill was not set down for consideration at any time in the first Session, any committal order in respect of the bill shall apply to proceedings on the Bill in the next Session (subject to paragraphs (10) and (11)).
(10) If the bill was reported from a public bill committee under paragraph (3), it shall stand committed to a public bill committee in respect of those clauses and schedules which were committed to a public bill committee in the first Session and not ordered to stand part of the bill in that Session.
(11) If the bill was reported from a committee of the whole House under paragraph (3), it shall stand committed to a committee of the whole House in respect of those clauses and schedules which were committed to a committee of the whole House in the first Session and not ordered to stand part of the bill in that Session.
(12) If the bill was read a second time in the first Session and was not set down for consideration at any time in that Session, any order of the House giving leave for a committee on the bill to sit twice on the first day on which it meets in the first Session shall apply to the first day on which the committee meets in the next Session.
(13) If the bill was set down for consideration at any time in the first Session, the bill shall be set down as an order of the day for (as the case may be) consideration, further consideration or third reading.
(14) Notices of amendments, new clauses and new schedules given in respect of parts of the bill not disposed of in the first Session shall be reprinted as notices in respect of the bill as presented and proceeded with under paragraph (5).’.
Mr Speaker
With this we will consider the following:
Motion 3—Third Reading (Bills Brought in upon a Ways and Means Resolution)—
That Standing Order No. 77 (Third reading) be amended by adding at the end—
‘(2) The third reading of a bill brought in upon a ways and means resolution may be taken at the same sitting of the House as its consideration on report.’.
Motion 4—Sessionality (Supply)—
That, notwithstanding the practice of the House as to the legislative authorisation of (a) appropriation of expenditure and (b) maximum numbers for defence services, legislative authorisation of appropriation of Votes on Account and maximum numbers for defence services may take place on a day not later than 5 August in the Session following that in which the founding resolutions for the forthcoming financial year were agreed to by the House.
Motion 5—Consideration of Estimates—
That—
(1) Standing Order No. 54 (Consideration of estimates) shall apply for the remainder of this Session as if, for the word ‘Three’ in line 1, there were substituted the word ‘Five’;
(2) Standing Order No. 54 (Consideration of estimates) shall be amended in accordance with paragraphs (3) to (7) of this order;
(3) in line 1, leave out ‘before 5 August,’;
(4) in line 13, at end, insert ‘Provided that the foregoing provisions of this paragraph shall not apply on any day on which time has been allocated pursuant to paragraph (2)(b) of Standing Order No. 24 (Emergency debates).’;
(5) leave out lines 25 to 34 and insert—
‘Provided that on days on which time has been allocated pursuant to paragraph (2)(b) of Standing Order No. 24 (Emergency debates) or the Chairman of Ways and Means has set down opposed private business under paragraph (5) of Standing Order No. 20 (Time for taking private business), proceedings under this sub-paragraph shall not be entered upon until the business in question has been disposed of and may then be proceeded with for three hours, notwithstanding the provisions of Standing Order No. 9 (Sittings of the House).’;
(6) in line 38, leave out ‘hour prescribed under paragraph (5)’ and insert ‘day and hour prescribed under paragraph (6)’;
(7) in line 40, leave out paragraph (5) and add—
‘(5) Any estimates on which questions have been deferred to another day in accordance with the provisions of paragraphs (4) and (6) of this order, together with any questions so deferred, and all other estimates appointed for consideration on any previous day or half day allotted under this order shall be set down for consideration on the day to which the questions have been deferred.
(6) On the day to which the provisions of paragraph (2) or (4) of Standing Order No. 55 (Questions on voting of estimates, &c.) apply which falls after or on any day or half-day allotted under this order, the Speaker shall, at the time prescribed in paragraph (1) of that order, put, successively, any questions deferred under paragraph (4) of this order on any previous day or half day allotted under this order, any questions deferred under paragraph (4) of this order on the day and any questions necessary to dispose of proceedings on all other estimates appointed for consideration on any day or half day allotted under this order.’;
(8) Standing Order No. 15 (Exempted business) shall be amended, in line 41, by leaving out ‘(5)’ and inserting ‘(6)’; and
(9) Standing Order No. 41A (Deferred divisions) shall be amended, in line 23, by leaving out ‘(5)’ and inserting ‘(6)’.
Motion 6—Questions on Voting of Estimates, &c.—
That Standing Order No. 55 (Questions on voting of estimates, &c.) shall—
(1) apply for the remainder of this Session with the following amendments—
(a) in line 1, leave out ‘paragraphs (2), (3) or (4)’ and insert ‘paragraph (2) or (4)’;
(b) in line 2, leave out ‘the Speaker shall at the moment of interruption’ and insert ‘, at the moment of interruption or as soon thereafter as proceedings under the proviso to paragraph (3)(b) of Standing Order No. 54 (Consideration of estimates) have been disposed of, the Speaker shall (after putting any questions required to be put under paragraph (6) of Standing Order No. 54)’;
(c) in line 9, leave out ‘6 February’ and insert ‘18 March’;
(d) in line 14, at end, insert—
‘(c) votes relating to numbers for defence services;
(d) excess votes, provided that the Committee of Public Accounts has reported that it sees no objection to the amounts and modifications to limits on appropriations in aid necessary being authorised by excess vote.’;
(e) in line 15, leave out paragraph (3); and
(f) in line 33, leave out ‘paragraphs (2), (3) or (4)’ and insert ‘paragraph (2) or (4)’.
(2) be amended with effect from the start of next Session as follows—
(a) in line 1, leave out ‘paragraphs (2), (3) or (4)’ and insert ‘paragraph (2) or (4)’;
(b) in line 2, leave out ‘the Speaker shall at the moment of interruption’ and insert ‘, at the moment of interruption or as soon thereafter as proceedings under the proviso to paragraph (3)(b) of Standing Order No. 54 (Consideration of estimates) have been disposed of, the Speaker shall (after putting any questions required to be put under paragraph (6) of Standing Order No. 54)’;
(c) in line 6, leave out the words ‘and limits on appropriations in aid,’;
(d) in line 9, leave out ‘6 February’ and insert ‘18 March’;
(e) in line 14, at end, insert—
‘(c) votes relating to numbers for defence services;
(d) excess votes, provided that the Committee of Public Accounts has reported that it sees no objection to the amounts necessary being authorised by excess vote.’;
(f) in line 15, leave out paragraph (3);
(g) in line 29, leave out ‘, and limits on appropriations in aid,’; and
(h) in line 33, leave out ‘paragraphs (2), (3) or (4)’ and insert ‘paragraph (2) or (4)’.
Mr Heath
For the convenience of the House, it may be helpful if I say that it is not my intention later to move motion 7. There are two reasons for that: first, there is a deficiency in the printed version of the motion on the Order Paper; also, not moving it will allow further discussions with the Chair of the Liaison Committee and others on the consequences of the changes that we are proposing.
Sir Alan Beith (Berwick-upon-Tweed) (LD)
I welcome my hon. Friend’s willingness to use this unexpected interlude to ensure that, at the end of the day, Select Committees can be confident that they will have the opportunity to debate and report on the abolition of public bodies before such matters come to the Floor of the House or a Delegated Legislation Committee.
Mr Heath
I am grateful to my right hon. Friend, with whom I have been in correspondence on these matters. I am keen to ensure that we have a system that fits the needs of the House in dealing with such important issues.
The first motion and the other four motions that we are debating with it arise from three considerations. First, they arise from the need to adapt the House’s procedures to spring-to-spring Sessions. Secondly, they arise from the alignment project, which was initiated by the last Administration and has been taken forward by this Government. Thirdly, it is proposed to take this opportunity to undertake some minor tidying-up of the relevant Standing Orders. Some of the changes before the House are quite technical, not to say rather long. The House will be pleased to know that I do not intend to go through them individually; rather, I shall explain their purposes. The provisions are explained in detail in an explanatory memorandum that has been placed in the Vote Office.
On 13 September last year, my right hon. Friend the Leader of the House announced the Government’s intention to move the usual date of Prorogation and state opening from November to the spring, to create a fixed-term Parliament of five equal, 12-month Sessions. That decision has some consequences for financial business. The first motion before us today would adapt the House’s existing procedures for carry-over to enable the Finance Bill to be carried over from one Session to the next. The House has already passed legislation, in last year’s Finance Bill, to ensure that resolutions under the Provisional Collection of Taxes Act 1968 have continued legal effect from one Session to the next. The motion makes matching provision in the House’s procedures. My right hon. Friend consulted the Procedure Committee on the proposal in February. The Chair replied on 9 March indicating that the Committee was content with the proposal.
Mr Greg Knight (East Yorkshire) (Con)
May I say on behalf of the Procedure Committee that we are grateful that we were consulted on this matter? Is the Deputy Leader of the House aware that we concluded that if the Government wish to continue to have the Budget statement in March—I can understand why they would—then carry-over seems the simplest way of proceeding? We concluded, with cross-party agreement, that this would not lead to any loss of scrutiny.
Mr Heath
I am most grateful to my right hon. Friend on several levels: first, for the work that he and his Committee do on such matters; and secondly, for the nature of his response to the proposal that we are discussing. It is important that a Committee of the House has been able to consider whether any loss of scrutiny would be involved; it is also important for the House to ensure that no such loss would be involved. He and his colleagues have concluded just that, and I am pleased that they were able to do so on an all-party basis.
The first motion modifies the general provisions for carry-over in existing Standing Orders in two main ways. First, it allows carry-over without separate debate before Second Reading. The House will have already debated the substance of the provisions in question during the Budget debate, and there may be cases where Prorogation falls before Second Reading. Secondly, the motion ensures that both the specific character of Bills brought in on Ways and Means resolutions and the practices of the House in considering such Bills are reflected in Standing Orders.
The second motion falls into the category of a tidying-up measure. Because it is seen as the practice of the House that there should be an interval between each stage of the Finance Bill, the House is asked to agree a motion for each such Bill, allowing Third Reading to take place on the same day as Report. Such motions to vary the so-called practice of the House have now been tabled for 100 years, since the chancellorship of David Lloyd George. The House has not failed to pass such a motion since 1972, and has not debated Third Reading on a day subsequent to Report since 1991. Even for the House, I submit that 100 years of settled practice is enough to overturn the presumption that the practice is otherwise.
Mr Heath
I think we may have reached a settled view by this stage. The second motion therefore changes Standing Orders to allow Third Reading to follow Report on the same day without a separate motion in each case.
The remaining motions relate to Supply, which some would say is one of the more obscure aspects of the House’s procedure. Indeed, Supply might be thought to be the House’s equivalent of the Schleswig-Holstein question. I am glad to say that there are at least a few more people who understand the business of Supply, and I believe they are alive and of sound mind—allegedly. I understand that among their number is Sir Stephen Laws, first parliamentary counsel—there is no question but that he is of sound mind—who is about to retire, and for whose services to successive Governments and, indirectly, to this House the Government are very grateful. The changes to be made are not easy to follow, and are explained in detail in the explanatory memorandum, so I will endeavour to describe what lies behind them.
The first factor is the move to spring-to-spring Sessions. The current practice of the House requires that once Supply has been provisionally authorised, an Appropriation Act following on from that provisional authorisation needs to be passed in the same Session. At present, the first stages of authorisation of the votes on account and the limits on numbers for defence services take place in early spring, with final authorisation incorporated in the Appropriation Act, passed in June or July. The retention of that timing makes sense but, given the move to spring-to-spring Sessions, it will involve final authorisation being given in the following Session. The third motion enables this common-sense practice to continue. We are also making provision for five estimates days during the current, extended Session, following discussion with the Liaison Committee. Indeed, this responds to a request from the Liaison Committee.
The second factor is the alignment project, which was an initiative of the last Administration, but which is bearing fruit in the new Parliament. The project’s aim is to achieve better alignment between Budgets, estimates and accounts, and to simplify and streamline the Government’s financial reporting documents, thereby improving Parliament’s ability to scrutinise planning and actual public expenditure. Select Committees were closely involved at various stages in the development of the proposals, which were endorsed by the House in the last Parliament through the passage of part 5 of what became the Constitutional Reform and Governance Act 2010 and, in the present Parliament, through the resolution approving the proposals for the project that was passed following a debate on 5 July 2010. During that debate, the hon. Member for Harrow West (Mr Thomas), speaking for the Opposition, welcomed
“this further opportunity to confirm support for the sensible changes that the last Government created under the alignment project”.—[Official Report, 5 July 2010; Vol. 513, c. 93.]
The changes are being implemented with effect from the estimates for the financial year 2011-12. As a result of the changes already endorsed by the House, the estimates documents requiring formal authorisation are to be published only during two periods each year—between January and February, and between April and May.
Implementation of the project means that there will be two rather than three estimates events during a normal-length Session. There will be no winter supplementary estimates and no December estimates day or votes on outstanding estimates at that time. The motions before us reflect the move to two estimates windows each Session, when estimates day debates will take place and outstanding estimates will be voted on.
As a result of these changes, there will be two estimates days close together, usually in the early spring. The fourth motion thus provides that votable motions on such days will be deferred until the House votes on all outstanding estimates, usually at the end of the second such day. This builds upon the existing practice whereby votes are deferred on estimates days until the moment of interruption.
I hope that that is sufficient to explain the thinking behind these proposals, and I commend the motions to the House.
Chris Leslie (Nottingham East) (Lab/Co-op)
I am grateful to the Deputy Leader of the House for explaining the rationale for these motions, He did so with a certain degree of nonchalance, suggesting that they are quite technical. I am quite keen—I know many hon. Members are eager to speak in the debate—to keep an open mind and I am absolutely ready to be persuaded, but I have a number of concerns about the motions, especially about the first one, which deals with carry-over. It is true that the proposed changes are a downstream consequence of the shift to a fixed-term Parliament, with Sessions divided equally and running from May to May. As ever with this Government, however, we are left wondering whether they have properly thought through the consequences.
There are good reasons for the sessional divisions of the parliamentary calendar from year to year. Let us not be under any illusions: today’s proposals would massively expand carry-over provisions for legislation, potentially ending the convention whereby Bills should normally be introduced, considered and completed within the year in which Her Majesty outlines the Government’s plans in the Queen’s Speech. Carrying over a Bill should happen in special and infrequent circumstances. The previous Government introduced carry-over procedures to accommodate complex and technical legislation, largely where there was a cross-party consensus on the need for reform or where the addition of pre-legislative scrutiny or wider-ranging provisions necessitated a longer time frame for the Bill’s passage. Carry-over has been an exception rather than a rule. The House needs to recognise that, if the proposals proceed, standard legislation such as Finance Bills will routinely span the historical firewall that is in place to protect sessional business spilling over from one year to the next. Back-Bench Members will notice that carry-over is not possible for Back Bench-initiated legislation.
Ways and Means legislation has a set of histories that go back a long time. The motion would take carry-over provisions into quite different and possibly uncharted terrain. Finance Bills are particularly important legislation: they provide, of course, the means by which the public are taxed, businesses are forced to part with their money and resources are taken from consumers and workers to pay for the collective public services such as the defence of our country. This country was at the forefront of democratic innovation through which sovereignty passed from the monarchs to the people represented in this House of Commons. We should therefore reflect seriously on the rationale for the protections and safeguards that have accrued over the centuries to defend the rights of those being taxed. It is, after all, only the House of Commons that considers money Bills. Because these changes to the law do not gain scrutiny in the other place, we should be sure that we proceed with extra care in this place.
The Crown attends Parliament at the beginning of each Session and makes a specific request of Members of the House of Commons that
“estimates for the public services will be laid before you”.
This is the beginning of an age-old process built around the sessionality of supply, guaranteeing time for consideration of votes on account and ensuring that there is no taxation without representation. It might well be that the Government do not consider this cycle of proposal, consideration and approval important enough to retain the sessional disciplines. If so, I would have thought that they would have the courtesy to ensure proper and adequate consideration of the impact of these changes.
I am not sure that enough thought has been given to the consequences. There are some serious constitutional issues at stake. What on earth is the point of going forward with a sessional divide from year to year if the Crown is free to bunch together legislation across the years? The powers of Back Benchers are also an important issue. What powers do ordinary Members have over the timetabling of business if Ministers are not under pressure to conclude their business at the end of a Session and can merely table a motion and slip a whole Finance Bill forward? The hon. Member for North East Hertfordshire (Oliver Heald), who I believe was shadow Leader of the House at the time, said that
“the lack of pressure could encourage even more sloppiness in the drafting, programming and timetabling of legislation.”—[Official Report, 26 October 2004; Vol. 425, c. 1325.]
This pressure is useful to Parliament, to the House of Commons and to Back Benchers—a pressure that can be used to force Governments to accede to amendments and to ensure that they go forward before the end of a Session is reached. Ministers are keen not to lose their Bills. We need to consider these issues carefully. I can, of course, see the logic of the Minister’s arguments; I am simply saying that I am not sure that we have given enough proper and deep consideration to some of the issues.
Sessional disciplines matter. The Treasury, as we know, has already provided some evidence of poor drafting and a number of deficiencies have been seen in its proposals. The new powers to elongate consideration of the Bill to suit the Treasury’s timetable rather than that of Parliament could well lead to a lackadaisical, slapdash approach to what should be an efficient focus on the clear conduct of business. Parliament should, after all, have a realistic and measured work load before it and a legislative programme designed to ensure that each Bill receives fair and equal scrutiny.
Chris Leslie
This is indeed a conundrum. We are misaligning the calendar of the House of Commons with the fiscal year. We have managed to cope historically, but I do not have an answer. I would have liked deeper consideration of the proposals in a form that could be properly debated, rather than to find ourselves confronted with these motions on the Order Paper. I genuinely understand the Government’s problems. I do not wish to be obstructive, but I think it important to take some time to review what are, after all, arrangements that have been in place for many hundreds of years.
Mr Peter Bone (Wellingborough) (Con)
The shadow Minister is making a powerful speech. Is not one of the dangers—we hear it often—that the Government want to do something on the surface for very good reasons, but at the same time what happens strengthens the Executive and reduces the power of Parliament?
Chris Leslie
The hon. Gentleman has hit on an important point. If we have a too relaxed approach to the parliamentary calendar, we could see a repeat of the situation whereby this House of Commons is especially busy for a couple of months, but is then twiddling its thumbs for several months longer—perhaps when the Government are struggling to get their business through the other place.
The right hon. Member for East Yorkshire (Mr Knight) asked the right question: how should we proceed from here? I understand the arguments in favour of some of the proposed changes, but I wish that the Government had devoted more time and care to discussing the issues through the usual channels and allowing the problems that had been raised to be considered properly and thoughtfully.
It would be useful if the Minister answered some questions, because I remain to be persuaded. For instance, why should not consideration of a Finance Bill start a month or so later? I am not suggesting that that is necessarily the solution; I am merely speculating on what the consequences might be. We could still have a Budget in March, but proceedings on the Finance Bill proper could start immediately after the Queen’s Speech in May, at the beginning of the new Session. That might be preferable to a Committee stage taking place for a couple of weeks immediately after the March Budget, followed by an elongated break and then a return to the Committee stage about halfway through the clauses that had previously been under consideration. There is, of course, virtue in avoiding a disruptive period of down time in the middle of a Committee stage. I should like to know whether the Government and, indeed, the Procedure Committee have thought about that.
Will the Minister elaborate on the proposals in motion 2 on carry-over of Ways and Means legislation? He has not chosen simply to amend Standing Order No. 80A to remove the reference to Ways and Means. Instead, an attempt seems to have been made to copy and paste carry-over provisions in respect of other Bills into a new Standing Order relating specifically to Ways and Means and money Bills. As far as I can see, however, various elements have not been transposed: for example, Standing Order No. 80A(3), which provides for no more than one Bill to be subject to a carry-over motion, and (4), which prevents a carry-over motion to apply to a Bill carried over from a previous Session. There seems to be nothing technically in place to prevent a Finance Bill that has been carried over from one Session from being carried over again to another. I accept that such a development may be very unlikely, but I do not understand why it was not covered in the copy-and-paste exercise. It could be described as the Schleswig-Holstein question squared, and I should be grateful if the Minister could seek some inspiration in order to clarify the point.
I have heard the Minister argue about the move to the automatic Third Reading of Finance Bills on the same day as Report each year. He says that that it has been happening for 100 years—which, according to my hon. Friend the Member for Hartlepool (Mr Wright), may mean that it is too early to tell whether it is working. Even if it is normal practice, the Government have at least had the courtesy to table a motion seeking the House’s permission, rather than assuming that Third Reading shall always take place on the same day as Report. However, I feel that the practice may erode the purpose of Third Readings as a distinct stage in the passage of legislation. It may be entirely pragmatic, but although I am willing to be persuaded otherwise, I do not think that consequences of some of these changes have been properly thought through.
Can the Minister explain the rationale for the omission of the backstop date applying to the three days allotted to the consideration of estimates? I understand that he is changing the date from 5 August following line-of-sight discussions after the passage of the Fixed-term Parliaments Act 2011—that makes sense—but why not simply shift the date forward to February or March rather than omitting it altogether?
The Minister also said that he proposed to put back the “roll-up” day for the modification of estimates by only five or six weeks—to, I believe, 18 March—which strikes me as a fairly arbitrary choice. He also touched on the fact that we would lose one of those modification days, as the number would be reduced from three to two. It is a small point, but, again, I wonder whether it should have been considered in more detail.
I have total respect for the Procedure Committee and its Chairman, who engaged in informal discussions with the Leader of the House about the proposals and did not object to them, but—with the greatest respect—I wish that the proposals had been subjected to more adequate scrutiny, and to some form of challenge or review. There have been no public hearings or discussions, and no report has been provided to enable parliamentarians to digest and consider the proposals.
I believe that the changes require serious consideration, because they could have profound and unintended constitutional consequences. I have not yet been convinced by the Minister that we need to rush them through before the Christmas recess, although I shall wait to hear what he has to say. He has, in a statesmanlike way, withdrawn motion 7, and I wonder whether it would be wise for him also to seek to withdraw the carry-over proposals. Perhaps he could ask the Procedure Committee to consider the issues relating to those proposals in more detail, because, as yet, I am not fully persuaded that it would be responsible to support them.
Mr Greg Knight (East Yorkshire) (Con)
The hon. Member for Nottingham East (Chris Leslie) referred to what he described as a “queue” of Members waiting to speak, and went on to express his concerns about the proposals. I think he is seeing shadows on the wall in both respects. It seems to me that if the Government were to abuse the process that they are asking us to approve—having put the matter to the Procedure Committee on the basis on which they have put it to the House today—Members in all parts of the House would seek to hold them to account. The Government have made clear that these are changes of process to accommodate occasions on which the House does not prorogue at the normal time, and I therefore think that the hon. Gentleman’s concerns are misplaced.
The Leader of the House initially wrote to the Procedure Committee on 8 February this year asking whether the Committee was content for the Government to develop proposals to set aside the principle of sessionality in respect of supply procedure, and to provide for the carry-over of Finance Bills from one session to the next. The Committee subsequently engaged in a detailed discussion about a number of issues relating to the proposed procedure, following which we decided that we were content with it and with the Government’s reasons for proposing it..
If the House prorogues in April or May, as the Government propose, proceedings on supply will be interrupted. At present the supply cycle begins with the provisional authorisation of expenditure in November, with legislative authorisation being given in the summer. The Votes on Account are presented in November, and the House is asked to approve 45% of Government spending to cover the period between the beginning of the next financial year in April and the passing of the Appropriation Act in the summer. The principle of sessionality meant that expenditure approved in the Votes on Account had to be appropriated before prorogation.
The problem could, of course, be overcome by means of an Appropriation Act passed in the spring, as happens before a general election, but that was not considered to be an ideal solution. It would mean that the main estimate each year would contain details of only 55% of Government expenditure, the remaining 45% having already been appropriated after the Votes on Account. A further disadvantage of that approach would be that the Votes on Account contain less detail than the main estimates, and 45% of the total of public expenditure would therefore be appropriated on the basis of less detailed spending plans. It might be considered unfortunate if, at the same time as the beginning of the alignment project, a separate change meant that the main estimate only ever included 55% of the expenditure for which parliamentary approval was needed. The Government instead propose that the resolutions on which the Appropriation Act is founded should not fall at the end of a Session but should be time-limited. The Procedure Committee, on a cross-party basis, thought this was quite a reasonable way to proceed.
With a Budget in March or April, the Finance Bill, brought in on resolutions following the Budget, will not have completed its passage before the House prorogues in April or May and will have to be carried over to the new Session. It is also necessary for the Provisional Collection of Taxes Act 1968 to be amended, because under it, the Budget resolutions cease to have effect when the House prorogues.
The Finance Bill could be introduced in the new Session rather than being carried over, but would therefore not be published until May. Although a draft Finance Bill could be published following the Budget, with the Finance Bill itself being introduced in the new Session, the Government of the day would not thereby have the flexibility to introduce some proceedings on the Bill, such as Second Reading, before the House prorogued. The Procedure Committee therefore concluded that the Government’s proposals for the carry-over of the Finance Bill would not affect the opportunities available to Members to scrutinise the Bill and vote on its provisions, and there would be no impact on the length of the Committee stage, for example.
Given that the Government wish to make the Budget statement in March, it seemed to us—again, there was cross-party agreement—that the carry-over of the Finance Bill is probably the simplest solution to the problem of the House proroguing in the spring, and one that does not interfere with Members’ ability to scrutinise the Bill.
We therefore concluded that these proposals were modest and reasonable, and I hope the House will reach the same conclusion.
Thomas Docherty (Dunfermline and West Fife) (Lab)
I am grateful to be called in this—[Interruption.]
Mr Deputy Speaker
Order. I can assure those waiting to speak that the hon. Gentleman did give notice that he would be speaking, so if we can just hold our water. I will be coming to Sir Alan next.
Thomas Docherty
Thank you, Mr Deputy Speaker; I hope to keep my remarks relatively brief.
This short debate is obviously a consequence of the Fixed-term Parliaments Act 2011, which was recently passed, and is an example of why, rather than hastily charging through such legislation and fixing it in this piecemeal way after the event, it might have been more appropriate to work through all the consequences of that change. I hope the Deputy Leader of the House will reflect on what happens when proper pre-legislative scrutiny of such a major Act does not take place.
I have the greatest respect for the Chairman of the Procedure Committee, the right hon. Member for East Yorkshire (Mr Knight). I have the privilege of serving under his leadership—I joined the Committee in the summer—and he has been an excellent Chairman. I do not at all doubt the sincerity of his words today and his genuine conviction that due diligence has been shown on this important, if slightly technical issue, but I hope he will not mind if I show some dissent in that regard. When I asked the Clerk of our Committee on Monday whether it was possible to get copies of the transcript of the informal private hearing that the right hon. Gentleman convened in the spring, the Clerk made it clear that although I, as a member of the Committee, could see it, other Members of the House could not. With the greatest respect to the Chairman, that is an unsatisfactory basis on which to change the Standing Orders of this House. If not all Members of this House are able to read the deliberations of the august Procedure Committee, how can our colleagues simply take our word for it?
I do not object in principle to what the Government are suggesting. Like many Government initiatives, it appears on the surface to be a reasonable suggestion. However, as we have discovered repeatedly over the past 18 months.
Mr David Hamilton (Midlothian) (Lab)
Why does my hon. Friend think that the document has not been put into print, so that the rest of us can see it?
Thomas Docherty
I am always tempted to see the worst in this Government, but on this occasion I think it is probably a genuine oversight. They did not think things through and realise that, if the Procedure Committee simply had an informal session on this issue, it would not be able to share the wisdom of its thoughts. The Deputy Leader of the House shakes his head; perhaps there was some Machiavellian motive that he wishes to outline to the Committee. I was giving him the benefit of the doubt, but apparently it was a deliberate attempt not to have to reveal something.
Thomas Docherty
I can assure the Deputy Leader of the House that the Chairman of the Procedure Committee would not respond favourably to such a suggestion, such is his independence of thought. However, why have the Government made it clear to my hon. Friend the Member for Nottingham East (Chris Leslie) that they do not believe it appropriate to pause slightly, so that the Committee can carry out a public, transparent and short inquiry in the new year? Perhaps the Deputy Leader of the House’s diary is so busy in the new year that he cannot do that.
The Government seem to be assuming that we will prorogue in the spring, and I look to the Treasury Bench for some clarity on that. My understanding is that all their Bills are currently jammed up in the House of Lords and there is absolutely no sign of their making any substantive progress on clearing the backlog. That is why, with the greatest of respect, we are having a series of Opposition debates and one-line Whips—because the Government have no business in the House of Commons.
Mr Knight
I remind the hon. Gentleman and ask him to reflect on the fact that not one single member of the Procedure Committee, including the Labour members, asked for any sessions on this issue to be held in public. I say to him seriously that if, having put to the House that this is a technical alteration to accommodate the Government’s wish to change when the House prorogues, the Government were to use this as a lever or mechanism to reduce the House’s scrutiny of its business, there would be one hell of a row which many Government Members as well as Opposition Members would join, saying that the Government had misled the House and would have to retract what they were doing. The hon. Gentleman’s fears do not therefore amount to very much, because the Committee has proceeded with this measure on the basis on which it was introduced to the House today: that it is a technical change. If it became something else, there would be one hell of a—
Mr Deputy Speaker (Mr Lindsay Hoyle)
Order. Come on—this is a speech! You have already made one; we do not need a second speech, Mr Knight, do we?
Thomas Docherty
I am grateful to the right hon. Gentleman for his comments. I have to tell him that the consequences of having an informal hearing were not in my view explained, and the Liaison Committee might wish to look at this issue in future.
I am conscious that the right hon. Member for Berwick-upon-Tweed (Sir Alan Beith) wants to speak, so I will sit down.
Sir Alan Beith (Berwick-upon-Tweed) (LD)
I am slightly surprised at the sudden growth of opposition to this motion among Labour Members. I wonder whether there is any other aspect of today’s timetabling, or other matters, that may have entered into consideration, but I could be wrong about that.
I want to welcome the action the Government are taking, but before doing so let me say that the hon. Member for Nottingham East (Chris Leslie) made what is in principle an important point: sessional discipline is significant in the way in which the House operates. It brings pressure to bear in circumstances where, otherwise, Government majorities tend to prevail; it causes them to stop and think as a degree of blockage occurs in the Lords at that stage of a Session.
We are talking about Bills—Finance Bills—founded on a Ways and Means resolution for a limited, specific and entirely explainable purpose related to the whole financial timetable of both the House and the Government. I was bemused by the idea of what state a Government trying to carry over a Finance Bill through three Sessions could possibly be in, other than the one envisaged by some Opposition Members in dealing with our current financial circumstances. This is not the debate to go into that, however.
I will deal first with the increase from three to five in the number of estimates days for this Session, which is a long Session. That is welcome, but I must put on the record the Liaison Committee’s request that there be five estimates days in normal Sessions, and our desire that that request be properly considered when we resume Sessions of the normal duration. There has been some Government resistance to that request—wait until we have at least seen more of the impact of the Backbench Business Committee. We have already seen the beneficial impact of that Committee, though, and I see no conflict there at all. Indeed, the Liaison Committee and the Backbench Business Committee are developing good ways of working together to ensure we maximise use of House time as Members want it to be used.
Mr James Gray (North Wiltshire) (Con)
Will the right hon. Gentleman give way?
Sir Alan Beith
I have a choice. I will give way first to the hon. Member for North Wiltshire (Mr Gray), then to his hon. Friend.
Sir Alan Beith
I am an avid and long-standing supporter of the principle of a House business committee. I think you would rule me out of order, Mr Deputy Speaker, were I to stray too far into that subject, but let me say that that is indeed a matter that could be so resolved were that committee in existence. For the moment, however, we must look to the Leader of the House to do such things for us.
Mr Syms
It has always seemed strange to me that on estimates days we have before us vast tomes showing where the Government have switched money from one Department or one heading to another, but we tend to debate leisure centres or swimming or something else—nothing to do with money. If this House is serious about money, surely we ought to look at the estimates rather than debate some odd other subject?
Sir Alan Beith
Absolutely so, and I have been advocating that for some time.
That brings me to my next point, which is about ensuring that Select Committees, which are the proper place to look at some of the substance of the estimates decisions and the movements of money from one thing to another, have appropriate time to consider such matters—as much time as possible, so that they can conduct meaningful scrutiny. Our discussions with the Treasury and the Leader of the House about that are reflected in the motions, but we will watch carefully to make sure that Select Committees are not expected within ridiculous periods—a few days—to produce considered views on the serious substance of estimates.
To sum up, the two major points that the Liaison Committee will certainly be considering and that we want the Government to consider are that due regard is given to the Committee’s previous recommendation of five estimates days per Session, and that Select Committees have time to consider estimates properly and so assist the House in doing what many right hon. and hon. Members have long felt should be done when we deal with estimates.
Mr Heath
With the leave of the House, Mr Deputy Speaker, I shall respond to the debate. I am most grateful to the right hon. and hon. Members who have contributed to this brief debate. I am particularly grateful to my right hon. Friend the Member for Berwick-upon-Tweed (Sir Alan Beith) for his comments. He is right to say that there are wider questions and more far-reaching changes to the way the House scrutinises spending plans which we need to discuss at some point, but I think that those wider reforms would be best debated in the context of proposals from the Liaison Committee, rather than from Government. It may well be that there are better ways of organising our business. The hon. Member for North Wiltshire (Mr Gray), who is not in his place—
Mr Heath
I beg the hon. Gentleman’s pardon; he is not sitting where I expected to find him. He made an important point about the advent in due course of a House business committee. We are looking at that, as we said we would, but even under existing arrangements it is open to any Select Committee, through the Backbench Business Committee, to seek time on the Floor of the House to debate a motion relating to departmental spending plans. The great advantage of that method is that the time constraints and procedural limitations arising from estimates procedure are absent.
The hon. Member for Poole (Mr Syms) asked why, during estimates day debates, we talk about Select Committee reports on matters that are either at some distance from or fairly peripheral to the essential element, which is scrutiny of Government accounts. Although that is a good question, it is one for another day, as it does not fall within the narrow confines of the motion.
I am grateful to the Chair of the Procedure Committee, the right hon. Member for East Yorkshire (Mr Knight), for his assistance. The idea that this is somehow a rushed process, when we put the proposals before that Committee for its consideration back in February and it is now, let me remind the House, December, or that we did not think of these things in advance, when we passed the proposals for consideration before the announcement of the change to the sessional timetable, is something of a nonsense. These are matters on which we needed the advice of the House; we have received that advice through the Procedure Committee, and that is why the motion has been brought before the House.
Mr Heath
I of course have no idea what goes on in the usual channels, but I hope that the hon. Gentleman agrees with me that it is far more important that a Select Committee of this House has had the opportunity to comment on proposals that affect the scrutiny of Government business by the House. Not only was the Procedure Committee consulted, but it agreed unanimously that the change would assist scrutiny by the House and would in no way diminish the opportunities for Members to have their say on Government business.
Chris Leslie
We have indeed heard that the Procedure Committee looked at the proposals, but it did so in private, informal session and there was no sharing of many of the proposals with other hon. Members until the business appeared on the Order Paper a few days ago, I think. Will the Deputy Leader of the House confirm the day on which it appeared? I saw it only recently and no one approached me to discuss it. To dismiss as nonsense the concern we have expressed about haste is a little overblown.
Mr Heath
I think the hon. Gentleman is making a valiant effort to bring some substance to his objections to the proposals, but he is not succeeding. At various times he accused me of being nonchalant. I hope that I am not nonchalant. Simply that something is technical does not imply nonchalance. Flying a jet liner is a technical business, but one should certainly not be nonchalant about doing so. As I said, we have thought through the consequences.
The hon. Gentleman said that we are massively increasing carry-over, but we are not. We are specifically and precisely dealing with the consequences for Finance Bills of the change to sessional periods. He said—at least, I think I heard him say—that having longer to scrutinise a Finance Bill made it more difficult to scrutinise it effectively. I am not sure that that is always the position of Her Majesty’s Opposition.
To deal specifically with his questions, the hon. Gentleman asked why should not the Finance Bill start in the new Session. The answer is: for the very obvious reason that if it did, the time available to the House to debate and scrutinise the Bill would be reduced. That cannot be right. He asked whether paragraphs (3) and (4) of Standing Order No. 80A apply to Finance Bills. Had he read the explanatory memorandum, he would have seen stated therein that those paragraphs will apply to Finance Bills.
The hon. Gentleman asked whether the provisions of paragraphs (12) to (14) of Standing Order No. 80A apply. Yes, the Standing Order will prevent a Finance Bill from being carried over more than once, as is stated in the explanatory memorandum. However, I have to say that if we had a Government whose Finance Bill was carried over between three Sessions, they would no longer be a Government, because they would not be a functioning Government. They would be a dead Government if they were unable to get their Finance Bill through in three Sessions of Parliament. I think we can safely assume that those circumstances will not apply.
On supply, the hon. Gentleman asked why the cut-off of 5 August under Standing Order No. 54 is being removed without being replaced. The timetable requirements for estimates procedures do continue and are set out in Standing Order No. 55. He asked why the first cut-off for supply is changing from a date in February to a date in March. That change does not affect the spring deadline. The February date was the cut-off for the winter supplementary estimates, which will no longer be published.
Despite the hon. Gentleman’s valiant efforts to try to find a cause on which he could unite his party against these very modest and sensible proposals, he has failed to establish any case for doing so. I commend the orders to the House and I hope that the House will be able to agree them without opposition.
Question put.
The House proceeded to a Division.
Mr Deputy Speaker (Mr Lindsay Hoyle)
I ask the Serjeant at Arms to investigate the delay in the Aye Lobby.
Opposition Day
Unemployment
(13 years ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
17:35 - The House divided: - Ayes: 233 / Noes: 307 - Question accordingly negatived.
Mr Liam Byrne (Birmingham, Hodge Hill) (Lab)
I beg to move,
That this House believes that the Government’s policies of cutting spending and raising taxes too far and too fast have resulted in the UK economy flat-lining for 12 months, well before the recent eurozone crisis; notes that unemployment has reached a 17-year high and over-50s unemployment has risen sharply; further notes that slower growth and higher unemployment makes it harder to get the deficit down and that the Office for Budget Responsibility forecasts a further rise in unemployment to 8.7 per cent., a rise in the benefits bill of £29 billion, and an increase in projected borrowing of £158 billion; agrees with the IMF’s warning that ‘consolidating too quickly will hurt the recovery and worsen job prospects’ and that the Government should ‘have a heightened readiness to respond, particularly if it looks like the economy is headed for a prolonged period of weak growth and high unemployment’; and, in light of the Office for Budget Responsibility forecasts published on 29 November 2011, calls on the Government to reconsider its refusal to adopt the Opposition’s five point plan for jobs which includes creating 100,000 jobs for young people and building 25,000 affordable homes using funds raised from a tax on bank bonuses, bringing forward long-term investment projects, temporarily reversing the January 2011 VAT rise, a one-year cut in VAT to 5 per cent. on home improvements, and a one-year national insurance tax break for every small firm which takes on extra workers.
It is a shame that the Secretary of State for Work and Pensions has chosen not to be present for the third Opposition day debate on unemployment and living standards. We rely, I hope, on the Minister for unemployment to relay back the nature of today’s debate and discussion.
The House meets to debate the motion after more grim news on jobs this morning. Grim news on jobs this month has followed grim news on the Budget last month. Once again we have seen this morning how the Chancellor’s decision to clobber the recovery is clobbering families all over our country. Once again we have heard of families losing their jobs because of this Government’s decision to cut too far and too fast, and once again we see the consequences of this Government’s decision to stand easy while millions of people in our country are now standing idle.
Not even the Minister for unemployment could spin his way through the statistics published this morning—unemployment up by 128,000, employment down, vacancies down and the public sector now losing jobs 13 times faster than the private sector is creating them. We do not have to look very far for the root cause of this unalloyed misery for families 11 days before Christmas. The Chancellor laid it out for us just a fortnight ago. Last year he was boasting about delivering cuts that were £40 billion greater than the cuts planned by Labour. Last year he was boasting about how Britain had suddenly become a safe haven. Last year he was so pleased with himself that he said this country was out of the danger zone. How hollow those words ring today.
The autumn statement laid bare the catastrophic failure of the Chancellor’s policy—growth flat lining for a year, borrowing up £37 billion higher than the plan drawn up by my right hon. Friend the Member for Edinburgh South West (Mr Darling), welfare up by £29 billion, and debt up an extraordinary £158 billion higher than forecast, which is £6,500 more for every house in this country. Borrowing, welfare bills and national debt are all higher, but growth is nowhere to be seen.
David T. C. Davies (Monmouth) (Con)
The right hon. Gentleman appears to be criticising the Government for borrowing more money. How much more money would he have borrowed, had he been in government?
Mr Byrne
If the hon. Gentleman had been listening carefully, he would have heard me answer that question. The plan that my right hon. Friend the Member for Edinburgh South West and I set out entailed borrowing that was £37 billion lower than that outlined by the Chancellor in his autumn statement a couple of weeks ago. That is of grave concern to the number of people who are now out of work, especially young people in the hon. Gentleman’s constituency, where long-term youth unemployment has gone up by 128% this year, which must surely concern him.
The Minister of State, Department for Work and Pensions (Chris Grayling)
Will the right hon. Gentleman give way?
Mr Byrne
I will in a moment.
Amid these difficulties, people in this country expect the Minister for work to do something about it, and I think that I speak for many Members of the House when I say that most right-thinking people in this country believe that the Government should be doing more to get people back to work.
During Work and Pensions questions a month ago I pressed the Secretary of State to tell us what exactly he is doing to get Britain back to work. A vast constellation of initiatives was set out, including work clubs, work experience, apprenticeship offers, sector-based work academies, the innovation fund, the European social fund, the skills offer, the access to apprenticeships programme, Work Together, the Work programme, Work Choice and mandatory work activity. Listening to that list, I became slightly puzzled. With such sweat being worked up at the Department for unemployment, surely we could expect the country’s unemployed to be positively flowing back into jobs. Members can imagine my surprise when I saw the Office for Budget Responsibility’s forecast that, amid that blizzard of initiatives, unemployment is forecast to go up. How can that be?
We asked the Secretary of State to tell us just how many jobs have been created by this glorious expenditure of energy at his Department. This is what we were told in a written answer in Hansard. On Work Choice, no statistics will be available until spring 2012. On mandatory work activity, no statistics will be available until February 2012. On work clubs,
“the data requested are… not available.”
On work experience, a link was provided to a website that says nothing about jobs actually created. On apprenticeship offers, we were told:
“Information on the number of people placed in work through apprenticeship offers… is not available.”
On sector-based work academies, we were told that
“there is no national requirement for districts to record and report job outcomes achieved.”
On the skills offer, “information… is not available.” On Work Together,
“the data requested are not available.”
On the innovation fund,
“no young people have been placed into work at this point.”—[Official Report, 21 November 2011; Vol. 536, c. 122W.]
Here we are, with unemployment going through the roof and the OBR telling us that unemployment is forecast to rise again next year, but despite the multiplicity of schemes laid out by the Secretary of State, who cannot be bothered even to come along to the debate, he cannot tell us how many people are going into work as a result of the spending his Department has in place, with the exception of one programme. The one initiative—it is buried in his answer in Hansard—run by his Department that he can claim is actually creating jobs is the programme financed by the European Union. He said:
“European Social Fund support has achieved 75,671 job outcomes from July 2008 to October 2011.”—[Official Report, 21 November 2011; Vol. 536, c. 122W.]
No doubt that is why he is urging his right hon. Friend the Prime Minister to get the hell out of the EU.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
Are not leadership, boldness and imagination missing from that catalogue? With 1 million young people unemployed, surely we need something that captures the imagination—for instance, by using young unemployed graduates to train other people in the community and in the environment. We need imagination now.
Mr Byrne
My hon. Friend is absolutely right, and he has been a long-standing champion of the need to get young people into work and, crucially, equip them with the skills to succeed in the workplace, but I am afraid that we have a deficit of that from the Government. It is an embarrassment for the Minister that he is unable to tell the House how many people his schemes are getting into work. The Secretary of State appears to have so much confidence in the schemes that he cannot be bothered to turn up this afternoon. However, I want to make a more substantive point about the Minister’s flagship scheme.
Mr Byrne
I will in a moment, but first I want to make one point about the Work programme.
The Work programme is a new scheme that builds on the flexible new deal. We have said that if it works and delivers value for money we will keep it in place, but the Minister must accept that worries about the programme are growing. [Interruption.] I am delighted that the Secretary of State has been able to join us to hear this important point. The Minister for unemployment has repeatedly told the House that he cannot produce statistics on how well the Work programme is doing, and I completely understand his caution. I think that he is the only Minister who has been formally warned by the chairman of the UK Statistics Authority, who last year said that the Minister’s use of figures was
“likely to damage public trust in official statistics”.
No doubt he has repented for that sin and is seeking redemption, and I understand that he apologised and is certain not to repeat the offence. If the Work programme was working, surely the Department’s statistics would show that more and more people were flowing off benefits and into work. That is a simple test we can apply, but the problem is that the figures do not show that.
Ms Gisela Stuart (Birmingham, Edgbaston) (Lab)
On that basis, how does my right hon. Friend, as a fellow Birmingham MP, react to the fact that in the past year, between November 2010 and November 2011, the number of young people in Birmingham claiming jobseeker’s allowance increased by 19%, which is the worst figure for all core cities in the country?
Mr Byrne
That is an extremely serious problem for Birmingham, and my hon. Friend is absolutely right to draw the House’s attention to it, but there is a more widespread problem if the rate of people flowing off benefits into work is not rising. Research by the House of Commons Library for my office, which we are publishing this afternoon, shows that fewer people are flowing from benefits into work than at any point since 1998. That fall coincides with the Government’s decision last year to cancel the flexible new deal and the future jobs fund. Since January, when the future jobs fund ended, the percentage of people flowing off benefits and into work has fallen by a fifth. Between May and August last year, when the new scheme was being worked up, 86,000 fewer people came off benefits and into work than the year before. Surely Government Members would accept that that is simply not good enough.
Oliver Heald (North East Hertfordshire) (Con)
Does the right hon. Gentleman not accept that the future jobs fund was not about providing long-term jobs, but about short-term work placements of six months in the public sector? What is the point of that? If he wants to talk about solid outcomes for the future, he should not be talking about the future jobs fund, because within weeks the people involved were out of work again.
Mr Byrne
Let me say as diplomatically as I can to the hon. Gentleman that since the future jobs fund closed long-term youth unemployment in his constituency has gone up by 43%. He must accept that the future jobs fund was helping to keep young people in work. We know, as Ministers accept, that keeping young people close to the labour market, close to jobs and close to the habits of work is a good thing.
Oliver Heald
We all agree that keeping young people close to the labour market is important, and the advantage of what the Government are proposing is that it is in the private sector, where the jobs will come, where those opportunities are being given. Does the right hon. Gentleman not accept that in all the years when Labour was in government the number of people not in education, employment or training stood at a very high level and barely moved, despite all the growth?
Mr Byrne
Let me repeat that when Labour was elected in 1997, youth unemployment was about 14%. It came down to about 12% before the recession and then, yes, of course it went up during the recession, as all unemployment did. But rather than sit there doing nothing, as this Government have over the past year and a half, we chose to act. That is why youth unemployment was coming down before the election and why, since this Government were elected, it has gone up to record highs and has done so again this morning. That is surely not a record of which the hon. Gentleman can be proud.
Mrs Main
If the right hon. Gentleman wishes young people to be near the labour market, does he regret presiding over the lowest number of social housing units ever developed under a prosperous Government? That means that young people cannot have social housing at an affordable level and are therefore unable to access jobs in areas where there are high house values.
John Cryer (Leyton and Wanstead) (Lab)
Will my right hon. Friend confirm that 65,000 jobs have been lost in the construction sector alone, and that that is because of the slump in building across the board?
Mr Byrne
That is absolutely right. The construction sector has taken an absolute hammering since this Government took office, not least because of their foolhardy decision to get rid of infrastructure projects and building projects such as Building Schools for the Future that would have equipped many of our young people with the facilities needed to deliver a world-class education in the years to come.
Chris Grayling
Will the shadow Minister be extremely careful about the information that he lays before the House? Last month, in our previous debate on this subject, I told him that Department for Work and Pensions statisticians had made a comparison between youth unemployment lasting for more than six months as of now and two years ago, and that on a like-for-like measure there has been virtually no change. He keeps insisting that there has been a substantial increase, but the civil service statisticians say that that is not correct. Will he please stop making that assertion to this House?
Mr Byrne
I know that, like me, hon. Members will have read last year’s letter to the right hon. Gentleman from Sir Michael Scholar. The letter was very assertive about the way the right hon. Gentleman had used statistics before. I am happy to lay the letter before the House for those who have not seen it. I am also happy to show the Minister figures produced by the House of Commons Library, which show that since January long-term youth unemployment has risen by over 90%. That is a badge of shame for this Government, and the Minister should be doing more to get our young people back to work.
Susan Elan Jones (Clwyd South) (Lab)
Does my right hon. Friend share my view that the Government seem to be stuck in an ideological Tardis in their view of the public-private divide in the economy? A case in point is what they have done to the solar panel industry. We have seen massive job losses in the private sector because of a loss of private and public sector contracts. It is amazing that the Government cannot seem to get hold of this concept.
Mr Byrne
My hon. Friend is absolutely right. We were promised that this was going to be the greenest Government ever, but a wide group of green and conservation organisations now say that the Government are comprehensively failing to meet that commitment. We all know that one of the key growth sectors for the future has to be low-carbon industries. The Government should therefore be doing more to get people into work in these sectors, not least by providing some regulatory certainty about the future.
Let me finish my point about the collapse in the rate of people flowing off benefits and into work. There is a very basic test. The Minister’s plan is not working unless it is getting more people off benefits and into work, unless the unemployment bill is coming down, and unless it is really making a difference—and right now, he is failing on every single count.
Steve Rotheram (Liverpool, Walton) (Lab)
Does my right hon. Friend agree that the 227 additional people who have joined the dole queue in Liverpool, Walton may be seen by the Conservatives as just collateral damage from their failed economic policy, but for each of those individuals, although they are a statistic to the Government, theirs is a personal tragedy? Does he agree that they are still the same old Tories who believe that unemployment is a price worth paying?
Mr Byrne
Many will draw exactly that conclusion, not least because when they see a Secretary of State who is unable to come to this House and set out how many jobs his various initiatives are creating, they must conclude that he simply cannot be bothered to find out.
I want to spell out how two particular groups are being pretty badly hit by this Government’s policies. The human cost of the Government’s failure to get people back to work, to which my hon. Friend the Member for Liverpool, Walton (Steve Rotheram) alluded, will be on everybody’s minds this afternoon. When families get together this Christmas, there will be plenty of anxious talk about the year ahead. This House has debated many times before the dangers of creating a lost generation, and today that news got even worse. Youth unemployment is up by 54,000. As my right hon. Friend the Leader of the Opposition said earlier today, long-term youth unemployment is up this year by 93%. Two hundred and seventy of us now represent constituencies where long-term youth unemployment has risen by over 100%. That is simply not good enough.
Jim Sheridan (Paisley and Renfrewshire North) (Lab)
As someone who spent three years unemployed due to the activities of the Economic League, I well understand the indignity that unemployment brings. One of the things that kept me sane during that period was the ability to go along to the jobcentre and speak to people who could help me to get back into work. This Government are now closing the jobcentres.
Mr Byrne
The Minister says that this is nonsense. I am afraid that he will be giving the House the illusion that he is not taking the figures that we saw this morning seriously enough. He went on the media this morning and said that today’s figures, which show youth unemployment rising to the highest level this country has ever seen, represented a stabilisation in the labour market. When youth unemployment is going up, overall unemployment is going up, and women’s unemployment is going up, that is not stabilisation—it is a tragedy for the people those figures represent, and he should be doing more to get them back into work.
Geraint Davies (Swansea West) (Lab/Co-op)
Does my right hon. Friend agree that it was a massive strategic error for the Government to announce over a year ago that they were going to get rid of half a million public sector jobs? Public servants spent less because they thought they were going to lose their jobs. Together with two years of a 1% pay freeze, which will reduce real incomes by 17%, and the attempt to dress up a 3% change in income tax as a pension contribution, that has massively deflated the amount of consumption in the economy and given rise to flat lining growth.
Mr Byrne
My hon. Friend makes an extremely good point. The recovery has been clobbered, and as a result the welfare bill is now going through the roof. That is a bill that the rest of us are going to have to pay.
We now have, since we last met, a youth contract on the table. That is a recognition that it was a mistake to get rid of the future jobs fund and to leave instead, for two years, no active programme for getting young people back into work. That was a grave error. The shame is that this contract was paid for by a botched deal between the Deputy Prime Minister and the Chancellor; I do not think that the Secretary of State was even in the room. He should remember that if you are not in the room, it is quite hard to influence the decision. What emerged from the quartet, as I think it is quaintly called, was a shabby settlement that took money off hard-pressed parents with children to pay for this Government’s failure to get young people back to work. In the past, the Secretary of State has talked a lot about the marriage penalty, and there are sympathisers with his argument on both sides of the House. However, he too must now recognise that he is presiding over the biggest parents’ penalty that we have ever seen introduced into the benefits system, with twice the amount of money being taken off children and families than will be taken off the bankers over the course of this Parliament. Surely Government Members cannot be proud of that.
I want to ask a couple of questions about the youth contract to which I hope the Minister will be able to respond. First, will he admit that 53,000 work subsidies this coming year is far too few for the task that we have in hand? That equates to only one opportunity for every 20 young people now unemployed. Secondly, in 2009—this is perhaps of interest to the hon. Member for North East Hertfordshire (Oliver Heald)—Labour introduced a form of work subsidy, but the take-up was not great and the Conservative party attacked it remorselessly. What has accounted for the sudden change of heart over work subsidies? Thirdly, and perhaps most importantly given the Minister’s concern about statistics, when will we find out how many people the youth contract is getting back into work? Will it be Work programme providers who operate the schemes? If so, why do so many of them appear to be completely in the dark about the scheme and its introduction? If the contract proves not to work in short order, will the Government consider reintroducing Labour’s future jobs fund, which was such a success?
Ann McKechin (Glasgow North) (Lab)
I share my right hon. Friend’s concern about the fact that we still have no details regarding the youth contract. I asked the Minister last week how much of the programme would be spent in Scotland and he could provide me with no information whatever. No one in Scotland, including Work programme providers, private employers and those in the public sector, has any idea what they have to plan with or to work with. That is simply hopeless when so many people are out of work.
Mr Byrne
That was indeed a very disappointing answer to my hon. Friend, particularly considering today’s rise in unemployment in Scotland.
I want to highlight one other group of workers who have been particularly badly hit. The over-50s are now losing jobs at a faster pace. The number of people in that group in Britain who have been unemployed for more than a year has risen by about 25% this year. Such workers often fear that they will not get back into work again and that they will be thrown on to some kind of silver scrap heap. The picture of the country that emerged this morning is terrible: long-term unemployment among the over-50s is up by 21% and in seven regions—Wales, the north-east, the east midlands, London, the north-west, the south-west and the west midlands—it is even higher. More than 50 Members of this House now represent constituencies where the rise in long-term unemployment among the over-50s is more than 50%. That is surely unacceptable and it surely demands a response from the Government.
Mr David Winnick (Walsall North) (Lab)
Will my right hon. Friend bear it in mind that that situation is very much like what happened in the 1980s? People in their late 40s, let alone those in their 50s, were made redundant when there were two major recessions. Many of them were never to work again. That is the humiliation that was heaped on our fellow citizens. Although the Government and Tory Members do not seem to be much concerned—only five Tory MPs are present, leaving aside the Parliamentary Private Secretary—the tragedy is that there is now a repeat of what occurred at that time.
Mr Byrne
My hon. Friend is right to remind us of what happened in the 1980s. Of course, that was the decade when the number of those left to languish on incapacity benefit went through the roof.
Our motion calls on the Government to change course. We call on the Government to learn from today’s figures, to remember our young people, and to listen to the worries of the over-50s. We want them to change course and give us a real plan for getting people back to work and for creating growth. We think that there is another way and that the Government need to listen, and fast.
This is perhaps the last debate that I will lead for the Opposition this year. I want to conclude by looking ahead to an important anniversary next year—the 70th anniversary of the Beveridge report. I think that it is appropriate to mark the achievement of that very different kind of alliance; an alliance that genuinely acted in the national interest. The report was commissioned by a Labour Minister, written by a Liberal and welcomed by a nation. The Beveridge report provided the foundation for the welfare state created by the Attlee Administration. It was a welfare state that freed people from fear and it was created on the proceeds of full employment. I believe that the goal of full employment should once again be our aim. I hope that next year we can celebrate the achievement of that progressive alliance by rededicating ourselves to the idea that politics can make a difference, that politics can author the policies that get this country back to work once again, and that politics once again can offer this country freedom from fear.
I commend the motion to the House.
The Minister of State, Department for Work and Pensions (Chris Grayling)
I rise to take part in episode two of the debate that we began a month ago.
Let me start by saying, once again, that this Government regard unemployment among people of all ages as bad, although youth unemployment is a particular concern. All unemployment is bad and it will remain a priority for this Government to deal with the issue, to help those who are unemployed back into work, and to create an environment in which businesses are able to grow, develop and create jobs. We will do everything that we can to tackle this genuine blight, which causes concern for Members on both sides of this House. It is a problem that we must tackle.
I must also say, however, that I have seldom in this House heard such a load of complete nonsense as I have just heard from the shadow Secretary of State. He used statistics that bear no relation to the truth and he made an argument based on achievements of the previous Government that bear no relation to reality. We need to remember that it was the Labour Government who brought us youth unemployment of nearly 1 million, unemployment of 2.5 million, a deep recession, the biggest peacetime financial deficit in our history, and a Chief Secretary to the Treasury who was best known not for his taste in cappuccino or the memos that he sent to his staff, but for the note that he left behind, saying that “there’s no money left”.
Mr Byrne
The whole House is enjoying the Minister’s frivolity with such a serious issue. Will he just remind us how much extra the Chancellor proposes to borrow over and above the plans that he set out before the House last year? Is it a figure not unadjacent to £158 billion more than he forecast?
Chris Grayling
Had we followed the economic strategy of the right hon. Gentleman when he was at the Treasury and of his former boss, the former Prime Minister, not only would we be in the same kind of financial predicament today that some of our European partners are in, but we would have unemployment that is much higher today than it is.
Sheila Gilmore (Edinburgh East) (Lab)
The report issued by the Office for Budget Responsibility at the time of the autumn statement made it clear that the boom was greater and the recession sharper and deeper than had previously been thought. It also stated that the recovery in 2009 was stronger than had previously been thought, and that it was brought to an abrupt halt in the second half of 2010. Perhaps the Minister would like to reflect on what happened in 2010 to change things.
Chris Grayling
What the hon. Lady has missed is that the OBR said at the time of the autumn statement that the structural deficit—not the cyclical deficit—that we inherited from the previous Government was much worse than it had previously believed. That means that the economic legacy that we inherited was much worse than we had previously believed. It is therefore a much bigger task to overcome that and to get the economy growing again, to get jobs being created again and to get Britain moving.
Mr Sheerman
I know that the Minister cares about this issue and that we are going to have point scoring. However, a million young people and their many millions of parents and friends are waiting for something to happen. Point scoring will not help them. The shadow Secretary of State finished by remembering the 70th anniversary of the Beveridge report. He was offering an olive branch. In that spirit, why can the Government not say, “Let’s all get around a table and find something together that helps the young unemployed people in this country.”?
Chris Grayling
The hon. Gentleman will learn, if he listens to my speech, that we are already doing things. We have delivered a package of support that will make a significant difference to the lives of the unemployed.
We keep hearing about a mythical two-year gap in provision. I remind the Opposition that the programmes that we inherited from them finished only three months ago. Today’s unemployment figures cover part of the period when the previous Government’s programmes were continuing.
Let me take up the points that the right hon. Member for Birmingham, Hodge Hill (Mr Byrne) made about this morning’s unemployment figures. He questioned why I had said this morning that the labour market had showed some signs of stabilisation. Let me explain why. It is because over the past month, employment has risen by 38,000 and unemployment has risen by 16,000, a number that is considerably exceeded by the change in activity levels. The youth unemployment figure, excluding full-time students, has remained static, and the jobseeker’s allowance claimant count has risen by 3,000, whereas the total number of people who have moved off incapacity benefit and income support as a result of our welfare reforms is 10,000. Those are one month’s figures and certainly do not reflect a long-term change, but they are at least a sign of some stabilisation in the labour market. I think he would and should welcome that.
Kate Green (Stretford and Urmston) (Lab)
I want to return to the Minister’s point about the previous programmes having only just come to a conclusion. He surely accepts that they were running down. If someone started on a future jobs fund programme at the very end of its life, that individual would inevitably be in work for a further six months. However, that does not mean that there was not a substantial gap between the announcement of the closure of some programmes and the Government finally getting around to opening up a new programme, the youth contract, which we understand will not actually come into effect until next April.
Chris Grayling
That is simply not correct. We managed a transition strategy that kept existing programmes going until the first part of this autumn, precisely to ensure that there was not a gap in provision between what we inherited and what we were putting in place.
Oliver Heald
Does my right hon. Friend share my consternation that Opposition Front Benchers are saying that they would reintroduce the future jobs fund, given that it was an entirely public sector operation providing work placements but no permanent jobs for the future? Surely it is much better to go with the private sector option, as the Government are talking about. That is a way of providing jobs for the future.
Chris Grayling
I absolutely agree, and that is central to what we are trying to achieve. The measures that we are putting in place, which I will set out for the House in a moment, are designed to ensure that we help young people, indeed people of all ages, to move into roles in the private sector, where there is a long-term, sustained opportunity for them to build careers.
Ian Austin (Dudley North) (Lab)
Is it or is it not the case that Jaguar-Land Rover in the west midlands provided placements for young people through the future jobs fund?
Chris Grayling
The hon. Gentleman will know that in order for a private sector organisation to participate in the future jobs fund, it had to set up a special purpose vehicle to work around European Union state aid rules. The result was that virtually all placements under the future jobs fund were in the public and community sector. In putting in place additional programmes, providing apprenticeships and providing a subsidy through the youth contract, we are focusing support on roles in the private sector.
Ms Gisela Stuart
I will focus not on the over-50s, because I would have to declare an interest, but on 18 to 24-year-olds. In Birmingham, 15,600 of them are claiming jobseeker’s allowance. If the Minister is so focused on private sector job creation, will he give me one example of how he is encouraging the private sector in Birmingham to get jobs for that lost generation, rather than providing a programme of aid?
Chris Grayling
I will set out in a moment how our work experience scheme, for example, is succeeding in helping young people to move into work in the private sector.
Mr Robert Syms (Poole) (Con)
Youth unemployment started rising in 2004 and peaked at nearly 1 million in 2009. Will my right hon. Friend set out the facts about that in an honest and straightforward manner? The problems did not start in 2010.
Chris Grayling
My hon. Friend makes an important point. From listening to the Opposition, one would believe that the problem had simply emerged in the past few months. One would not believe that unemployment among young people was almost 1 million when Labour left office. Indeed, the total number of young people not in education or employment passed 1 million during the last recession, but we do not hear about that from Labour.
Mr Byrne
The Minister can try to evade the truth as much as he likes, but he cannot duck the basic fact that youth unemployment was about 14% when Labour took office. Before the recession it came down to 12%. It did go up during the recession, but it was coming down before the election. Since the election, it has gone through the roof to a record high. He simply cannot duck that truth. Why does he not get on and do something about it?
Chris Grayling
I will explain what we are planning to do, but we should remember that youth unemployment was at almost 950,000 when Labour left office, which was higher than when it took office. We are not going take lessons from Labour and its record on youth unemployment.
I wish to set out the approach that we have put in place to try to support the unemployed.
Chris Grayling
No, I am going to make some progress now.
The first priority has to be to help get business moving and growing again. That involves having a stable financial environment in which businesses are confident that this country is not going to find itself in the economic predicament that some other nations are facing. We therefore remain determined to address the deficit challenge, bring our public finances under control and send a message to the world that Britain understands the challenges that we face and is trying to do something about them. That is why we saw such a good response in the bond markets this morning to this country’s attempts to sell its bonds, and why other countries are facing difficulties. I believe that if we had not taken those measures, businesses would not be investing in this country or considering employing people here. I believe that unemployment would be higher than it is today.
We also have to take measures that, within the confines of the financial constraints upon us, do everything possible to encourage and support business. That is why my right hon. Friend the Chancellor set out in his autumn statement two weeks ago a variety of measures designed to do just that. They include investment in infrastructure; an expansion of the regional growth fund; increased capital allowances in enterprise zones; and measures to underpin bank lending to small businesses, so that they can access the finance that they need to grow. Those are essential parts of ensuring that in exceptionally difficult times, businesses at least have the best foundations that we can possibly give them to enable them to grow.
Chris Grayling
The right hon. Gentleman and other Members can read the OBR forecasts, which state that at the end of a difficult economic period unemployment will start to fall again. I remind him that we are dealing with international circumstances that the Governor of the Bank of England described as being among the most difficult in modern times, if not the most difficult.
Of course, alongside the measures that we need to take to support and encourage business growth, we need high-quality support for the unemployed to ensure that we can get them back into work as quickly as possible.
Fiona O'Donnell (East Lothian) (Lab)
The Minister has been on his feet for what feels quite a long time, and he has attacked the public sector and talked about how he will support the private sector but not once mentioned the third sector. That shows the Government’s real attitude to that sector’s role in supporting people into employment, which was what made the future jobs fund work.
Chris Grayling
If the hon. Lady will allow me, I will finish explaining what we are doing. Last night, we published figures showing that 20% of referrals taking place through the Work programme are being handled by the voluntary sector, so it is playing an extremely important part in our work. It is also helping us to deliver a number of other programmes, and it is an integral part of supporting both the short and long-term unemployed.
There are a number of elements to the package that we have put in place. The first is support for the shorter-term unemployed, with a particular focus on the young, through our work experience programme and sector-based work academies. The right hon. Member for Birmingham, Hodge Hill would know, had he read the figures that we published, that the first statistics, for the period up until August, showed that more than 50% of the young people going through our work experience programme moved off benefits quickly afterwards. Indeed, we know that many of those young people are staying in employment with the employers who gave them their work experience place. The scheme is a great success, and we are doubling its size as part of the youth contract.
I should like to put it on record that I am very grateful to all the employers up and down the country, large and small, that are offering young people work experience and helping to break the vicious circle whereby people cannot get a job unless they have experience, but they cannot get experience unless they have a job. The scheme is cost-effective, costing one twentieth of what was spent on the future jobs fund for a broadly similar outcome. It is a great initiative, and I pay tribute to all the Jobcentre Plus staff who are working on it.
Mr Byrne
I am grateful to the Minister, who is characteristically generous in giving way. I assume that he refers to the statistics that were published on the Department’s website about work experience, which showed that between January and August 2011, 16,360 claimants started a “get Britain working” work experience placement. That is in the written answer that he gave me. Of those 16,000, how many have got jobs?
Chris Grayling
We know that just over 50% of those people were off benefits within a total of 12 weeks from day one of their placement. It is an eight-week placement, so the answer is, in effect, within a month of the end of the work experience period. That is the first set of figures. The right hon. Gentleman said, “No more figures till February”, and he is right. He cannot berate me for misuse of national statistics—he and I can argue about that offline sometime—and at the same time demand that I misuse them to give him more evidence now. We will publish the figures for the programme at the appropriate moment, but I am confident that they will continue to show the real difference that it is making to young people.
Brandon Lewis (Great Yarmouth) (Con)
Does the Minister agree that the best thing is the Government’s bringing everything together to ensure not just that private sector businesses grow to employ people, but that we put good, solid training, work experience and apprenticeships in place so that people can not only get into work but have sustainable long-term employment, unlike through some of the fad projects of the past?
Chris Grayling
I agree. The second part of the support that we are providing to young people—and, indeed, to older workers, for whom apprenticeships are also available—is a substantial increase in the number of apprenticeships. More than 100,000 new apprenticeships have been announced since the general election—the total across the Parliament will take apprenticeship provision far beyond where it has been previously. We believe that an apprenticeship that combines training and a real job for many young people is a better vehicle for delivering a long-term career option for them than simply putting them into a temporary six-month work experience placement at significant cost to the taxpayer, as we experienced with the future jobs fund. I accept that we do not agree on that: Labour Members believe that their approach was better. However, we believe that sustained employment in the private sector with an apprenticeship for a substantial proportion of young people is the best option. I am delighted that my hon. Friend the Minister for Further Education, Skills and Lifelong Learning, who is responsible for that, has put in so much effort and won so many extra resources for apprenticeships.
Lilian Greenwood (Nottingham South) (Lab)
I heard what the Minister said about the programmes that he has put in place, but how can he claim that they are successful when there has been an increase in long-term youth unemployment of 88.6% and in long-term unemployment for people over 50 of 59% in my constituency in the past six months?
Chris Grayling
I make the same point to the hon. Lady that I made to the shadow Minister: I wish they would stop producing figures that are not statistically valid. The previous Government had something called the training allowance. Somebody who had been out of work for 12 months and entered the new deal programmes went for a short time on to a training allowance. That meant that their JSA claim was moved back to day one. As a result, the previous Government claimed to have abolished youth unemployment. We have stopped doing that—we do not hide the unemployed. We accept the scale of the problem and try to tackle it properly. The civil service statisticians in the Department for Work and Pensions carried out a like-for-like comparison, which shows that there is virtually no difference in youth unemployment for more than six months between today and two years ago. Opposition figures are therefore simply not accurate.
The third element of the support is through the Work programme, which began at the start of July. It has been going for five months and is the most ambitious welfare-to-work programme that the country has seen. The first signs from providers are encouraging. We will not have official statistics till next year, but there are many examples of people who have been out of work for a long time getting into work. It is a payment-by-results scheme, so providers have every incentive to use the right approach to working with people in a personalised way to deliver the right support to them individually and to match them to the right job; otherwise they will not stay there. Given that the full payment is not made until a conventional jobseeker has been in work for 18 months, there is a real incentive to ensure that it is about not just placing someone in a short-term job but building a long-term career for them.
Gordon Banks (Ochil and South Perthshire) (Lab)
The Minister wants accurate figures, so let me tell him that 130 people in my constituency in highly skilled engineering jobs are losing their jobs today because of cuts in public sector spending. It is a private sector business. Does the Minister not understand that cuts in the public sector impact on the private sector? Here in my hand is the proof to show that.
Chris Grayling
I regret every single redundancy in any sector in any part of this country. It is a terrible blow for the people concerned. I do not know about the case, but if the hon. Gentleman wants to talk to me afterwards, I will ensure that Jobcentre Plus support from a rapid response team is available to his constituents. I regret any such situation. However, we are having to get to grips with the challenges of the public sector because of the mess we were left. If we did not do that, unemployment would be higher, not lower. I stress that we will do everything we can to help the hon. Gentleman’s constituents and those elsewhere who are in a similar position. Any unemployment is too high, and we will do all we can to help tackle it.
Let me briefly consider the youth contract because questions have been asked about it. It was announced shortly after our debate a month ago and I think that it will enhance the programmes that we are already delivering. It builds on the programmes that are already in place and will involve doubling the work experience programme so that we should be able to guarantee every single young person who has been out of work for three months a work experience place. Through the Work programme, it provides a subsidy to employers to take on a young person who has been unemployed for a longer time. The CBI proposed it to us, but it is more generous than the programme that the CBI requested. The shadow Minister made the point about the previous Government’s scheme in 2009, but the difference is that we are delivering something to a template that leading business groups requested. They say that it will make a real difference to the likelihood of an employer taking on a young person. I hope and believe that will make a genuine difference.
Jim Shannon (Strangford) (DUP)
One of they key factors throughout the United Kingdom that perhaps the Minister has not mentioned yet is small and medium businesses. In Northern Ireland, 90% of those in employment are employed through small and medium businesses. What help does the Minister intend to give small and medium businesses to create jobs and thereby address youth unemployment?
Chris Grayling
I agree that small and medium-sized enterprises are crucial. I hope that the subsidy that is paid to employers through the youth contract will be attractive to large and small employers. We are clear that the role that small businesses play is important. Opposition Members raised issues about unemployment among the older generation and I believe that our new enterprise allowance, which is proving successful in the areas where it has been operating so far and is now available throughout the country, will provide a real route for people who want to build their own SME in future.
Mr Deputy Speaker, do not listen to what you hear from the Opposition about the Government doing nothing about unemployment. We have a comprehensive range of support, which I believe can make a real difference to the unemployed. We face huge economic challenges and some of the most difficult economic circumstances that any Government have faced. However, unemployment is and will remain a priority for the Government. We will do everything that we can to tackle it.
Mr Deputy Speaker (Mr Lindsay Hoyle)
Order. I remind hon. Members that I am imposing a six-minute limit due to the number who wish to speak.
Albert Owen (Ynys Môn) (Lab)
It is a pleasure to follow the Minister. The statistics I will use are from the Office for National Statistics, but my experience is as a manager of a centre for unemployed people before I came into the House. I saw at first hand the failure of economic policy. That is what unemployment is: a failure of an economic system. It is not “a price worth paying” as a previous Chancellor of the Exchequer said.
In the 1990s, I ran a centre that helped young people to get back to work. We gave them life experiences and choices. Whether in the public sector, the private sector or the voluntary sector, those experiences were valuable tools and gave skills to young people. It is a shame that Government Members rubbish schemes involving the voluntary and public sectors, because people need help to get those necessary skills; they do not need Government Members to attack the public sector.
Oliver Heald
Does the hon. Gentleman not accept that it is something of a deception to put a young person in a job for six months with the idea that it will lead to something at a time when the public sector is being cut? Surely it is better to give that young person a private sector job opportunity or work experience that has some prospect of leading somewhere.
Albert Owen
I will tell the hon. Gentleman what a deception is: it is the Government saying that they will introduce a scheme next April when youth unemployment is going through the roof this month and last month.
Albert Owen
Of course it is! The hon. Gentleman really needs to look at the ONS statistics. In every corner of the UK, youth unemployment is going up. Young people are facing unemployment because of the Government’s record.
John Glen (Salisbury) (Con)
Why is it a deception if the Government set out a well thought through policy that they are ready to deliver in three or four months’ time? That is not a deception but a well organised policy. It is ludicrous to trade such cheap remarks about people’s jobs and futures.
Albert Owen
I shall tell the hon. Gentleman my background in a moment—I certainly know what unemployment is like and have worked with unemployed people—but month on month, people are losing their jobs. Saying that there is hope in future of a scheme—he says it is well thought out, but nobody has seen it implemented—is a disgrace when the Government are doing away with schemes that were working and helping people. I met people who went on those schemes. They had the opportunity in a major global recession to gain work experience and skills. That is what the Government should be doing; they should not be talking about some generous scheme of the future that we do not know about.
The Government’s record is one of increasing unemployment, which compares with the Government of the 1980s and 1990s. The centre for the unemployed where I worked was established in the 1930s, and was re-established in the 1980s because of mass unemployment and mass depopulation. People left my area to look for jobs in the 1980s and ’90s as they did in the 1930s. The county of Anglesey, which I represent, was the only county in Wales that had a declining population in two consecutive censuses, because people went looking for work. Yes, they got on their bikes, but it harmed our community. Unemployment is not a statistic to bandy around in the Chamber; it involves real lives and real people. It affects individuals, families and communities. I have seen communities scarred by mass unemployment, which is why I am passionate about standing up here today to say that this Government’s policies are not working. We need to work together to find policies that work. When the Government scrap policies that have been successful in my community, I will stand up and say so—that is the reality of the situation not only in my constituency but in many parts of the country.
In 1992, unemployment in my constituency stood at 3,912—nearly 4,000. By October 2002 it was down to 1,516, and by October 2007 it was down to 1,093, because schemes that targeted the hardcore unemployed to help them back to work were introduced.
I remember that there was no plan to help in the 1980s. In 1992, the Chancellor of the Exchequer said that unemployment was “a price worth paying”—it was an economic tool. The Minister shakes his head, but those were the Chancellor’s words, and he cannot contradict that because they are on the record. The Chancellor said that there were shoots of growth, but people were losing their jobs and livelihoods, and communities were being destroyed.
The buzzwords of the ’80s and ’90s were “downsizing” and “redundancy”. We needed a scheme, and when the Labour Government came to power in 1997, we introduced the new deal for the unemployed. A levy from the excess profits of utility companies was used and targeted to help young people. Between 1999 and 2004, it was hugely successful. I think it should have continued, but after 2004 the scheme was targeted at other sections of society that needed help. With hindsight, perhaps we should have continued to concentrate on young people.
Youth unemployment has gone up in the past 12 months, whatever statistics we use. Young people are losing their jobs or are not able to enter the employment market. My daughter’s peers, who are in their 20s, have taken extra university courses because they cannot get jobs. They are coming out highly qualified and cannot get jobs. That is the reality of the situation today. It is incumbent on us all, whichever party we represent, to get the number down. Although bandying statistics does not help, we must, none the less, use the records of different Governments to paint a picture. The record of this Government is to do away with schemes that were successful and to say, “We’ll replace them with something in the future.” The reality is that unemployment is going up.
Albert Owen
I am afraid that I do not have much time; I have already taken two interventions.
In the 1980s and 1990s, there was a period of stagnation in my constituency. The gross value added, or the gross domestic product, was among the worst in the United Kingdom. The historical scar is there and people are finding it difficult. Between 1997 and 2007, the number of jobs increased by some 7,000 and many skills were brought back to the area through various schemes. There was a partnership between Government, the public sector, the private sector and the voluntary sector, all working together to help people. That is the way forward.
I accept that unemployment went up in 2007, but it started to come down in 2010, which is important. When this Government took office, growth was increasing and unemployment was coming down. The trend has now been reversed and we are back to what it was like in the 1980s, and once again we are facing mass unemployment. Some 2.64 million people are unemployed, which is a disgrace for any Government. This Government should apologise for the fact that their policies are not working.
The Welsh Assembly Government are introducing additional projects to help the unemployed. Austerity alone will not create jobs; it is getting people skilled up and giving them the necessary experience, growing the economy, and bringing down unemployment that will increase the GDP and the GVA of every part of the United Kingdom. Wales has been hammered by unemployment. We need to move forward. Today is a bad day for unemployment and a bad day for this Government’s record.
David T. C. Davies (Monmouth) (Con)
The right hon. Member for Birmingham, Hodge Hill (Mr Byrne) and many of his colleagues have basically said that the Government should change course. I listened to them with great interest but did not hear any of them say what their course should be. I heard plenty of criticisms of the Government, but there has been no mention by the right hon. Gentleman of a coherent economic policy.
David T. C. Davies
I have heard about this tax on bankers’ bonuses, which has already been spent in myriad different ways. In any case, the Government have already introduced taxes on banks, which are bringing in far more money. I point out to the right hon. Gentleman—I am sure he knows this, given what his last job was—that the financial services industry in this country is contributing about 10% of all the money that we have, or somewhere in the region of £50 billion. At this moment in time, we cannot do anything too much that will damage that.
Let me explain to the House what I think the Opposition party’s economic policy was. Up until October and the Chancellor’s statement, the economic policy of Labour Members was to borrow even more money than we are being forced to borrow at the moment. Since October, everything has changed and suddenly their policy is to borrow less money. Amazingly enough, they are not only going to borrow less money, but spend more money. The Opposition are going to borrow less money but somehow there will be no cuts in Government expenditure and no freezes on pensions and everyone will have a job. It is a totally incoherent economic policy, but completely consistent with what we have come to expect from Labour.
Albert Owen
The hon. Gentleman says that we did not outline our plans. If he reads the motion, he will find them there, and he should be speaking to the motion. He said two things that were incorrect. He said that we would be spending more than the Government. In the autumn statement, this Government said that they would spend more than Labour. One tool of employment is taxation. Does he agree that reducing VAT temporarily during the previous recession helped employment and consumers? Would he support something of that nature now?
David T. C. Davies
The hon. Gentleman ought to know that I will always support any kind of tax cut if it is affordable and I welcome his conversion to that idea. I recall him talking about what happened when Labour got in, but he forgot one or two important facts. He forgot to tell us that when Labour got in in 1997, the national debt was some £350 billion. By 2007, before the economic crash, the national debt had risen to £650 billion. Yes, the Labour Government had been paying off the national debt for two years but when the election started to loom, all of a sudden off went the spending taps and they were spending at a rate of £30 billion or so on average more than they were earning. That meant that by 2007 they already had a problem, yet they let the spending rip and we ended up with a national debt of £1 trillion and a deficit of £160 billion. Their response was to say up until October that we should borrow even more money—now, they suggest we borrow even less.
What the hon. Ladies and Gentlemen on the Opposition Benches do not understand is that it is very easy to create a little employment in the short-term by borrowing money that one does not actually have, but the problem is that that will always lead to greater unemployment in the longer term because at some point—they do not realise this—that money must be paid back. In the meantime, the interest on it, which is about £30 billion a year at the moment, has to be paid. The only way that money can be paid back is by raising taxes, which destroys jobs, or cutting public spending. That is a basic economic fact that Labour Governments throughout history have failed to comprehend.
Of course, there are more things that this Government can do. We have taken the brave decision as a coalition to get rid of the deficit as quickly as we can. It might take until 2017—[Interruption.] Yes, I accept it is not going to be an easy task, given what we have inherited. It will take a number of years, but we will stay the course and do it, and we will do more, besides.
We must consider immigration. It cannot possibly be right that 250,000 people are coming into this country at a time of recession if we have to find them all jobs, too. My wife is one of them and my sister-in-law, who is from Asia, is another. I am not in any way against those who come here; I welcome the fact that people have come here and are making a contribution, but we must consider whether that is sustainable in the long term.
We must also consider the attitude of some British people—that has to be said. Neither of my sister-in-laws had problems coming over here from Asia and eastern Europe and getting jobs, but there is unfortunately a small minority of younger British people who would prefer to stay on the dole than go out and get a job. It is a harsh fact but it needs saying and it is something that this Government will actively tackle.
We need to look at the attitudes and training of those who come out of our schools, ensuring that they can add up and have basic English and social skills, as it is often people’s attitude that gets them a job. We must consider what our universities are teaching people, because it is no good if everybody comes out with a degree in media studies. There will always be some jobs for some people in the media, but not for all those who want them.
I have spoken to a number of people working in companies that are contributing a lot to this country—gas and oil companies and so on—and they say that they have had to go abroad to find people because there are not enough with the necessary practical skills in this country. By that I mean people who do not mind getting their hands a bit dirty. I spent four or five years getting my hands a bit dirty, as did many people on the Opposition Benches. I have no problem with that whatsoever. Unfortunately, some young people in this country at the moment do.
Grahame M. Morris (Easington) (Lab)
I am grateful to the hon. Gentleman for giving way, but may I urge him to focus on the issue of joblessness rather than worklessness? I think that was an offensive remark, although I am sure that he made it unintentionally. We have Office for National Statistics data giving the numbers of vacancies and the numbers of people who are unemployed, particularly young people. In neighbouring constituencies, such as Hartlepool, which is just to the south of me—
David T. C. Davies
I take the hon. Gentleman’s point. I am focusing on the fact that there are jobs out there for some people and that there are some people who will not take jobs. I accept that there are not enough jobs and we would all like to see more.
One thing the Government can do—I think they are considering this—is look at the red tape imposed on small businesses. When I ran a small family business, I was reticent to take people on because if we took on a contract to move goods from A to B that lasted for nine or 12 months and took on some extra drivers to do that, we were stuck if we suddenly lost the contract because we found it very difficult to get rid of people. We ought to look at lifting the red tape so that companies can take a risk by taking somebody on. If that does not work out, sadly, they might have to let them go but a lot of companies would hang on to people if they could. It is not the public sector out there—things are a lot harsher. The hon. Member for Stretford and Urmston (Kate Green) is laughing, but I wonder whether she has ever tried to run a small business. We are also, I am glad to say, looking at the green taxes that have been levied on the big industries, because there is absolutely no point in hitting big manufacturing companies with carbon and environmental taxes if they are simply going to relocate to the other side of the world and make their goods over there, taking jobs with them and probably creating even more carbon as they ship back whatever it was they were making.
I have only 45 seconds left, but I must mention the right hon. Member for Birmingham, Hodge Hill, who was going to give way to me, but failed to do so, when he mentioned Clement Attlee. We all supported the grandiose schemes of—not Clement Attlee, sorry, Bevin, who was supported by Winston Churchill at the time, the Conservative leader—[Hon. Members: “Beveridge!”] Beveridge, sorry. Not Bevin, no, I accept that.
The right hon. Gentleman will know, however, that Beveridge’s plans were built on the back of a war loan from the United States, which had to be paid off for decades afterwards; that Callaghan’s Government ended in failure; that Wilson had to devalue the pound; and that his own, previous, Government were responsible for the biggest boom and bust in financial history—
Mr Kevin Barron (Rother Valley) (Lab)
May I give the hon. Member for Monmouth (David T. C. Davies) a little history of how the economy is affected from time to time in the United Kingdom, as it has been for centuries and will carry on being, because unforeseen things come along and rock economies, as we experienced in 2008-09 under the previous Labour Government? That should not cloud the issues before us in the motion that my Front Benchers have tabled and I support, because the figure of 2.638 million unemployed people in this country represents a massive amount of human suffering, costs the economy and will go on doing so for generations if it is not tackled. The hon. Gentleman asked whether people are leaving school with the right language, literature and other skills to go into the workplace, but, having been a Member for 28 years, I have listened to such debates, and at certain points we decided to tackle the major issues that needed to be tackled in order to ease the problems that mass unemployment has caused.
Today’s rise in unemployment is our biggest since July 1994. The regional breakdown for Yorkshire and Humberside shows that employment—not unemployment—has fallen by 70,000 over the last quarter; that unemployment has increased by 9,000 on the previous quarter; that it stands at 253,000; and that the number of people claiming jobseeker’s allowance has increased by 500 on the previous month. That tells me and most people that there is something seriously wrong with the path that the Government are taking to turn the economy around, and that a large amount of money will have to be paid from the public purse to keep the figures as they are.
Youth unemployment went up by 54,000 in the three months to October and now stands at more than 1 million, the highest level since comparable records began in 1992. I brought the matter up at Prime Minister’s Question Time today, noting that more than 22% of 16 to 24-year-olds who could be economically active are unemployed, an increase of 1.2% on the previous quarter. That has major implications for the British economy and, certainly, for young people.
Long-term youth unemployment has gone up to 141,200, the highest level since July 1997, and by 68,000 alone since January, a rise of 93%.
Chris Evans (Islwyn) (Lab/Co-op)
Government Members are obsessed with immigration, when there is youth unemployment and young people are leaving school without the skills to fill the jobs that are going to come up. In future we will have to bring more people to this country to fill those jobs for which we do not have the skills.
Madam Deputy Speaker (Dawn Primarolo)
Order. Lots of Members are doing this: when they make an intervention or speak they have to face the Chair, not turn their back to it. So, if everybody could remember that, it would be very handy.
Mr Barron
Long-term youth unemployment has increased. In Yorkshire and Humberside, it increased from 7,160 in January 2011 to 13,895 in November 2011. That is an increase of 94% in long-term youth unemployment. In my constituency it has increased by 68.8%, while in the two neighbouring constituencies in the Rotherham borough it has increased by 125% and 80% respectively. We are talking about the life chances of young people in our constituencies being taken away from them. I have not seen such increases in youth unemployment since the 1980s, when my constituency and neighbouring constituencies suffered from the Government’s run-down of the coal industry, which not only put thousands of people on the dole, but struck off the life chances of people in education trying to get into work, as one of the major employers for young men in my constituency was systematically closed down. The consequences of that have run on not just for a few years, but for generations.
The Minister of State, Department for Work and Pensions (Steve Webb)
I do not doubt either the right hon. Gentleman’s sincerity or the fact that he believes the figures that he has been given, but let me tell him that they are simply misleading. What used to happen is that after a young person on jobseeker’s allowance had gone on a scheme, the clock would start ticking as though it were day one, which meant that they had disappeared from the long-term youth unemployment figures. The right hon. Gentleman is comparing figures that exclude those young people with those that include them, so the rise that he describes has not happened in the way that he believes.
Mr Barron
The idea that we should come here and dance around about whether all the figures are accurate, when there are 2.6 million unemployed people in this country, is not sensible. [Interruption.] I do not know: I am not a Minister, and I do not study the briefs that the Minister studies. What I do, and what I have done for over 28 years, is represent a constituency that is largely poor, with far too much deprivation in all sorts of areas, whether in terms of ill health, high unemployment or anything else. I saw that change in my lifetime, over a decade, which affected the lifestyles of many people in my constituency. I see from today’s statistics and what has been happening over the past 12 months that things are returning to how they were decades ago. It is wrong and it is unfair, and I am not going to come to this place and listen to a debate about “the national economy” this or “the national economy” that. We need to look at the crucial issues of how to help the young generation.
Mr Byrne
My right hon. Friend is making a characteristically powerful speech. The truth is that the House of Commons Library is clear: in January 2011, long-term youth unemployment in his constituency was 160, but it is now 270, a rise of more than 68%. Under anybody’s definition that rise is unacceptable, and the Government should be doing more to bring it down.
Mr Barron
I agree entirely with my right hon. Friend.
If anybody wants to know the consequences of youth unemployment—not just now, but in the future—they could do worse than look at the article headed “Future costs of youth unemployment” on the BBC business news website, which refers to an academic paper by Paul Gregg and Lindsey Macmillan that sets out in great detail what happens to people who suffer from youth unemployment. It affects them for the rest of their lives, not only in terms of their jobs, but in terms of their incomes and everything else. It is not acceptable for us to sit in this House today and watch youth unemployment increasing to its current levels, which will disadvantage generations of people and their children, as well as the taxpayer, who will have to pay for it. I will not rehearse how much it will cost, but there will be a cost to the taxpayer—the cost to the individuals concerned will probably be far higher—that we should guard against.
I want to finish on this point. The Government’s ideology was about coming in and saying, “We get rid of the public sector”—I have seen the damage of that—“and we bring in the private sector.” However, for every 13 jobs lost in the public sector in the last quarter, only one has been created in the private sector. It is not good enough. The plan is not working. It is about time this Government tried to protect everybody in this nation.
Jenny Willott (Cardiff Central) (LD)
Of course it is right that we are debating this important issue today. Everybody knows that unemployment is a serious problem across the country. We seem, however, to have had the same Opposition day debate over and over again. The same people have been in the Chamber repeatedly over the last few months, and every debate follows the same pattern. Labour never accepts responsibility for the economic mess in which we find ourselves and no new ideas on how to tackle the problem are offered; the same old failed ideas are repeated in every debate.
Jenny Willott
No, I will not. There will be plenty of opportunities for others to speak later. I hope that by not giving way, as many Back Benchers as possible will have the opportunity to contribute.
The Government are trying to rebalance the economy left to us by Labour. Labour relied on the public sector for far too long to make up for declining growth elsewhere, and it did not support the private sector in the good times. Some areas have stratospheric levels of public sector employment. In Merthyr Tydfil, for example, more than 40% of people—more than four in 10—are employed in the public sector. That is clearly not sustainable across the country as a whole. We must work to increase employment in other sectors—the private sector has already been mentioned and other Members have mentioned the voluntary or third sector—to reduce our reliance on the public sector and ensure that we have a much better balanced economy that is better able to absorb shocks from the global economy and future recessions.
There is some evidence that we are starting to see progress. I would take issue with the figures of the right hon. Member for Rother Valley (Mr Barron). My understanding is that public sector employment fell last year by 276,000, but that employment in the private sector increased by 262,000—a difference of only 14,000 jobs. Almost all the jobs lost in the public sector have been replaced by an increase in jobs in the private sector.
Jenny Willott
I am not going to give way.
There are problems in the eurozone, problems with bank lending and so forth, which have a serious impact on job creation in the private sector, but we can say that we are starting to see some progress, and the Government are trying to encourage even more progress. The Minister of State, Department for Work and Pensions, the right hon. Member for Epsom and Ewell (Chris Grayling), who is responsible for employment, announced in the autumn statement measures to stimulate growth. Rather than try to borrow their way out of a debt crisis, the Government are being more pragmatic and sensible. I welcome some innovative ideas for raising money—working with pension funds, for example, to unlock £20 billion of investment. That is better than the Government simply borrowing more and more money, which has been shown not to work.
I share the concerns of some Labour and Government Members about the level of youth unemployment. I know that this is a concern across the House. Under Labour, youth unemployment rose nearly 75% between 2001 and 2010, so it was a serious problem before this Government came to power. There has been an increase, however, in the number of young people who are unemployed, and I know that Ministers, too, are deeply concerned about that. I am glad that the Government are investing in trying to tackle it. We need to recognise that it is going to be tough for young people in the near future, and we need to do more to make them as employable as possible so that when jobs are created and become available, they can take them up.
We know from past experience, and from the experience of unemployed people today, that people who are seeking work and spending all their time going to the job centre and applying for jobs can find the experience hugely demoralising, and it can lead to depression and mental health problems. For decades, that has been a problem for people facing unemployment. We need to make it easier for younger and older people facing unemployment to volunteer in order to build their skills, to learn what they enjoy doing, to get useful information for their CVs, to get good references and to help keep them closer to the job market.
Jobcentre Plus and the Work programme providers could work with the local voluntary sector and others in many areas to identify more opportunities for those on jobseeker’s allowance to volunteer. There are already many opportunities across the third sector, which we have heard about in various debates on this theme. There are other ways in which unemployed people of whatever age can volunteer and build up their skills. For example, it is possible to become a magistrate at 21. That is a good way in which people can gain experience in an area about which they would not necessarily know anything otherwise, while also learning skills that they can transfer to employment. Charity shops are always looking for volunteers, who will have the opportunity to gain retail experience that they too can transfer to employment. The retail sector in my constituency still has a significant number of vacancies, and it is one of the sectors that are most willing to take on those who are furthest from the jobs market.
There are plenty of ways in which we can help people to develop the habit of working by getting up at the same time each day, finding out what they enjoy, learning people skills, and acquiring new skills that they can take into work when jobs are created. Some may be inspired to set up their own businesses—older people who have experience and skills that they can take into entrepreneurship, and young people who are brimming with ideas.
I accept that the unemployment figures are an individual tragedy for all the people affected, and I am sure that we all feel the same, but relying on the ability to borrow more money will not help us to find a way out of this situation. We need to see investment, and to see the Government putting their money where their mouth is.
Alex Cunningham (Stockton North) (Lab)
The dire news presented by the latest unemployment figures should cause members of the Government to hang their heads in shame, but there are not many present to do that today. The Government have promised much, but instead of delivering on their promises, they have proceeded to devastate the lives of ordinary hard-working people—people such as nurses, engineers, chemical process workers, local authority employees, shop assistants and even members of our armed forces, some of whom return from action on behalf of our country to learn that their jobs are either gone or under threat.
We were promised a private sector jobs revolution, but, as the Prime Minister had to admit today when challenged by my right hon. Friend the Leader of the Opposition, he has failed to deliver on that promise. His failure is proving expensive, not just for the millions who are unemployed, but for our country. Instead of investing billions in infrastructure, house building, new hospitals and other job creation schemes, the Tory Government are throwing that money away on escalating unemployment benefit bills which, sadly, are likely to increase even more in the future.
Gordon Banks
Is not one of the problems the fact that the Government seem to view the public and private sectors as two separate entities, although one cannot survive while the other is being cut to death?
Alex Cunningham
I agree. My hon. Friend provided an illustration of that earlier when he mentioned the job losses that have been announced in a company in his constituency. For some time the Tories said that we did not have a plan for jobs. They may have systematically dismantled our investment programmes for job creation, but it is not too late for them to adopt our five-point plan for jobs and growth.
Like others who have spoken, I shall concentrate on the subject of young people. The acceleration in the number of young unemployed people will help this Tory-led Government to go down in history as the Government who could not care less about our country’s most important asset.
Jim Shannon
It has been suggested that businesses should be given an incentive to employ people aged between 16 and 24, in the form of a £1,500 tax relief which would cover national insurance contributions for a year. Does the hon. Gentleman believe that such initiatives are capable of providing employment for unemployed people?
Alex Cunningham
I welcome all schemes that will encourage employers to take on workers and, in particular, increase the number of young people in employment.
In 1997, my Stockton borough inherited from the Tories an unemployment rate of 14.9% among young people, while the national rate was 8.1%. Hard work by the Labour Government more than halved the Stockton rate to 6.7%, but since then the Tories and their Liberal Democrat allies have allowed it to soar almost to its previous level. It is now 12.9%, which, although it may not seem a huge number, represents 2,300 young lives.
In my constituency, I see countless young people wandering the streets of Billingham, Norton and Stockton, and I worry about their future. I see them peering into shop windows, knowing that all they can do is look. They certainly cannot buy, as they see no positive prospects. They know that there is no longer any support that would enable them to go to college, and that even if they had qualifications, possibly even degrees, their prospects would be extremely low in an economy that is stagnant at home and across the country.
Cathy Jamieson (Kilmarnock and Loudoun) (Lab/Co-op)
Will my hon. Friend endorse the work done by Glasgow city council? It has launched a scheme aimed specifically at young graduates, and is using some of its pension fund to give them an opportunity to gain employment.
Alex Cunningham
I have always been a great admirer of Glasgow City council and I am certainly not going to disagree with my hon. Friend there, but it saddens me that for so many young people, the first taste of adult life will not be starting their first job and getting on the career ladder, but waiting in the dole queue and competing for the tiny number of vacancies available, while being lectured by the Tory-led Government that there are jobs out there for them if only they look hard enough. However, in my constituency there are 10 people fighting for every job vacancy. There are 2,335 jobseeker’s allowance claimants aged between 18 and 24—an increase of 18% on the previous year.
Earlier this year, the employment Minister singled out the north-east as his “top priority” in safeguarding and protecting jobs. However, the money received from the regional growth fund—believed to be the cure for all our economic woes—is but a fraction of what has been invested in recent years through the regional development agency. I am grateful for the money we did get in my constituency from the regional growth fund, and I was pleased to visit one of its recipients, Darchem Engineering, last week. It is a fine example of the great British manufacturer we need to encourage, and the Government cash will help to attract new investment to the north-east. However, while that one example is a positive one, the amount of cash available through the fund is extremely limited in my area, and many other companies with strong plans for growing their businesses and increasing the number of jobs found that the Government cash chest was slammed shut in their faces.
In my constituency alone, 166 young people aged between 18 and 24 took up employment and after 26 weeks, 162 of them—98%—were sustained in employment as a result of using part of Stockton’s allocation of the working neighbourhoods fund, thanks to our future jobs fund. Add to that the fact that those successful young people undertook 628 pieces of individual training and achieved 80 NVQs at levels 2 and 3, and we can celebrate an excellent achievement.
Labour also introduced the education maintenance allowance, which subsidised poorer students through the sixth form, helping 650,000 16 to 19-year-olds from low-income families and tackling the long-standing problem of a high teenage drop-out rate from education, particularly among poorer students. However, both these effective programmes were recklessly cut by the Tory-led Government, who dismissed them as bureaucratic and wasteful despite their strong success in helping young people to reach their potential.
The £180 million bursary scheme the Tories replaced the EMA with has instead succeeded in giving 70p extra a week to 12,000 of the poorest students—while at the same time taking away £30 from many of their classmates whose finances are only marginally better. It is simply insulting that the Secretary of State for Education believes that this is concentrating resources
“on removing the barriers to learning faced by the poorest”.—[Official Report, 28 March 2011; Vol. 526, c. 52.]
I strongly urge the Government to reassess their priorities, given that they are currently bent on making access to education far more difficult and are cutting everything in sight—the very things that were helping young people. Such a blatant disregard for the future of young people really is shameful. We should be under no illusions about the damaging effect that unemployment among young people can have. Failing to harness the energy of the younger generations is eating away at the foundations of all our futures.
Work largely defines us and as a society, and we cannot afford to ignore the talent and potential of so many young people. Those one in five young people who cannot find work therefore often cannot leave home. They remain financially dependent on their parents and are trapped in a confidence-sapping cycle of application after application, rejection after rejection.
The current jobless figures are a wake-up call for the future for young people. Youth unemployment scars people for life, particularly if it is prolonged, and at today’s levels it will be costing the country millions of pounds a week. We must not let the scourge of unemployment leave a permanent mark on the hundreds of thousands of young people living through it today. We need to give those young people, and everyone else window-gazing in towns and cities across the country this Christmas, real hope for the future. They see very little of it now.
Oliver Heald (North East Hertfordshire) (Con)
Listening to the hon. Member for Stockton North (Alex Cunningham), one would have thought, “Oh, the Labour Government did a marvellous job. Then along came this coalition and they mucked it up.” One would never have thought it was the Labour Government who beggared this country, who borrowed and borrowed and borrowed again, who gave us the worst deficit in the G20, who doubled national debt, who sold our gold at a record low price—£23 billion down the drain—who took £5 billion a year out of our pension funds, and who gave back our EU rebate of £7 billion a year and got nothing in return. Then, there was the moment of salvation—the last general election. A moderate coalition Government came in and started to make the sort of decisions that needed to be made in the national interest—the sort of decisions Labour ducked. Now, though, we are told, “The consequences of those difficult decisions—they’re all your fault.” They certainly are not.
If we look at the Labour years, we see that, as always happens with Labour, unemployment went up—to 2.5 million by the time they left office. We see that youth unemployment rose by 270,000 under the Labour Government. Theirs was not a successful Government, but a Government who led Britain to the brink of bankruptcy. It is our Government—the coalition Government—who are rescuing this country. Of course it is not easy. It is right to say that every redundancy is a personal tragedy—of course it is. We must try to do all we can as a country to help people back into work, but my goodness, this Government cannot be blamed for the situation from which they are trying to rescue the country.
That Labour Government were also the Government who tried to hide from the realities. Take the vast number of people claiming incapacity benefit: it is this Government who are testing and ensuring that those who receive incapacity benefit are genuinely entitled to it, and that it is not being used to mask unemployment in areas where there is a particular labour market problem. Take Labour’s measures on long-term youth unemployment, where a training scheme was introduced after 12 months and the clock was started again, to mask what was happening in this country. Although 2.5 million extra jobs—half of them were part-time, of course—were created in the Labour years, they did not seriously affect unemployment, which was reduced by about 300,000. That is because the Labour Government were not really tackling the underlying problem of the 5 million people of working age who were not engaged in the labour market.
Fiona O'Donnell
Given that is now clear that the benefits bill will rise by £29 billion—higher than the Government predicted—does the hon. Gentleman think that the plan is working?
Oliver Heald
I think that this Government are making a serious, determined and honest effort to help people in very difficult times. The hon. Lady talks as though there is no eurozone crisis and the world is not experiencing the problems it is experiencing, but those problems are out there. This is a difficult time politically and economically, yet this Government are trying to help people.
Nia Griffith (Llanelli) (Lab)
Does the hon. Gentleman accept that, in fact, the increase in unemployment in the eurozone has been much slower than the increase here?
Oliver Heald
The hon. Lady should talk to young people in Spain, where youth unemployment is very high—as much as 30%, I am told. The same is true in Italy. The fact is that youth unemployment is a European problem that must be tackled in the eurozone and right across the continent.
The Government are concentrating on a Work programme that, after 12 months, gives people individualised help to look at what skills and assistance they need to get them back into work, and that, for the first time, gives the disabled a chance of getting the help they need. That is a good thing. That programme and the youth contract, with its job subsidies and extra incentive payments, are not signs of an uncaring Government.
Dame Anne Begg (Aberdeen South) (Lab)
Everything the hon. Gentleman describes counts for nothing if there are no jobs for those people to get. That is the problem that we face today: there are simply not enough jobs in the economy for everyone who is out of work to get into work.
Oliver Heald
The hon. Lady makes the very important point that we need growth in our economy, and that to achieve that we need a range of measures to stimulate growth. I agree, and that is what the Government announced in the autumn statement. She should not, however, treat the whole country as though it were the same. We have much lower unemployment in my constituency—indeed, it has fallen this month—and there is no doubt that jobs can be found, but that is not true everywhere. The picture is different in different parts of the country, but if one looks at the overall picture one can say, month on month, that we have more people in the work force than we had last month. We have seen an improvement in some parts of the country, such as the part I represent, so the picture is not hopeless. The Government have a difficult task and are tackling it seriously, but sometimes we should look a little more widely at the labour market and the trends within it. We are asking people to work to an older age and to take on jobs that they might not previously have done because they were on incapacity benefit or were otherwise out of the labour market. So, we are asking more people to try to find work against a background in which that is not easy, but I believe—certainly the research shows this—that it is possible for us to see our GDP rise and our people go into work. What the Government are doing is along the right lines.
Sir John Rose said in a speech about a year ago that in Britain we train people to be hairdressers when we need engineers and IT specialists. One of the good things about the Government’s apprenticeships and skills programme is that it is targeted on areas in which we have found it difficult to create skills and on areas that are hard to fill, so there is a better match between skills and vacancies. The number of vacancies runs at between 400,000 and 500,000 each month, about 40% of which are in areas with skills shortages or areas that are hard to fill. If we can better match the skills to the vacancies, that could help. Overall, I think the Government are on the right lines.
Dr Eilidh Whiteford (Banff and Buchan) (SNP)
Today’s employment statistics make extremely sobering reading. They spell out more clearly than any of our speeches today just how much our economy is struggling and how the recovery is faltering. We know from the Office for Budget Responsibility that the UK economy is already contracting in the final quarter of this year and we can predict with some confidence that there will be more turbulent times in 2012.
Fiona O'Donnell
Has the hon. Lady seen the latest statistics showing that Scotland had the second-worst unemployment in the UK in the last quarter? Does she think that her Government in Holyrood have any responsibility for those figures?
Dr Whiteford
I am certainly happy to look at that because the sharp increase in unemployment in Scotland is very concerning. However, over the past year as a whole, unemployment in Scotland has fallen and employment has risen. That compares very favourably with the record of the hon. Lady’s Administration. For most of the past few years, employment in Scotland has outperformed employment in the rest of the UK. That record contrasts sharply with the situation when Labour and the Liberal Democrats were in coalition in Scotland.
We have to look at the big picture and remember that when the Government set us down the path of austerity a year and a half ago, many of us warned that taking the feet out from under the public sector was not the way to boost employment and growth in the private sector. We said that the cuts went too far too quickly and it gives me no pleasure whatever to be proved right on that front. It is now abundantly clear that the medicine is not working and is not achieving the results we want. I accept that the Government have not been in control of some of the external circumstances, but nevertheless those risks were always apparent. The Government need to acknowledge that their plan is not working and that it is time for a change of direction.
What has been disappointing this afternoon is the very ideological and doctrinaire approach taken by Members on the Government Benches to their prescriptions. It would be helpful if we acknowledged the interdependence of the public and the private sectors. The bottom line is that the UK as a whole is losing public sector jobs faster than the private sector can create them. We all know that borrowing is still very difficult for small and medium-sized enterprises, which is a major source of potential growth. We know that business confidence is low, but in that circumstance it makes no sense at all to punish the public sector when the private sector just cannot keep up.
Paradoxically, that is the opposite of what has been happening in Scotland. One of the interesting things—
Dr Whiteford
Not at the moment, thank you.
It has been evident in Scotland over the past year that the growth of private sector employment has outweighed falls in public sector employment. We now have the highest share of private sector employment that we have had since the advent of devolution. [Interruption.] Although unemployment has fallen across the piece in the past year, it shows that the Scottish Government’s decision to boost investment in the public sector and in infrastructure as far as possible has been a way of offsetting the problems of investment that have been apparent in other parts of the UK—[Interruption.] If the hon. Member for East Kilbride, Strathaven and Lesmahagow (Mr McCann) wants to make an intervention, I am happy to accept it. If not, perhaps he could stop heckling.
If we are serious about tackling unemployment, we need to accept that the cuts introduced by the Government are biting very hard indeed across the whole UK, and that the announcements in the Chancellor’s autumn statement do not go far enough. Crucially, they will not address the immediate challenges of high levels of unemployment and a high benefits bill. I am not sure how we will pay for that in the current circumstances.
Dr Whiteford
I will not at the moment, thanks. Time is pressing.
In Scotland we are experiencing 32% real-terms cuts to the capital budgets and even after the announcements in the autumn statement, the Scottish capital budget will still be cut by £3 billion over the spending period. More importantly, 70% of the new consequentials announced in the autumn statement will not be available until the year after next. Waiting until 2013 will not deal with the problem that we need to tackle now. What we need is investment in infrastructure.
Much has already been said today about youth unemployment. For those of us who came of age in the 1980s there is a horrible sense of déjà vu. I was one of those who had to put up with the 1980s and see the problems at first hand. When I hear young people in my constituency bemoaning to me the prospects that they are now facing, I have great empathy. It was exactly the same in the 1980s, when we were all told that unemployment was a price worth paying, and a whole generation was relegated to the scrapheap. We are still living with the legacy of that and dealing with the social consequences of it. It was not just about economics. It was about our society and the prospects of a whole generation.
Across the UK we have seen diverse approaches to tackling youth unemployment. It is far too high everywhere, but, as we have heard today, there has been a range of approaches in the devolved Administrations. In Scotland there have been 25,000 apprenticeships, a significantly higher number than before. It even exceeds what the UK Government are doing. University and college places have been maintained. Efforts have been made to ensure that apprenticeships that fall through because companies have gone under as a result of the recession are continuing and those young people are getting back into work. The Opportunities for All initiative is making sure that every young person aged 16 to 19 will get a work or training opportunity.
I hope Ministers will take the opportunity to sit down with Finance Ministers across the devolved Administrations and look specifically at how we can tackle youth unemployment. There are different approaches and there are good ideas coming from different parts of the UK. It is such an urgent problem and such a challenge with such serious long-term consequences that I hope the Minister will take action. We were told in the 1980s that unemployment was a price worth paying. It was not a price worth paying. It is never a price worth paying. It must be the Government’s top priority.
Madam Deputy Speaker (Dawn Primarolo)
Order. There are still 12 hon. Members remaining to speak. The debate must end by 5.36 pm. I am therefore reducing the time limit from now to four minutes for all subsequent speakers. That will just about get everybody in, unless there are lots of interventions.
Mrs Anne Main (St Albans) (Con)
I shall take no interventions, given the need for brevity. I share the concerns of my hon. Friend the Member for North East Hertfordshire (Oliver Heald) that Labour Members seem to have collective amnesia about exactly how much they frittered away during the prosperous times for this nation and that they now claim that only they know how to fix it.
I am amazed that that flexible old chestnut, the bankers’ bonus, has been wheeled out yet again as a way of solving all the ills. This is from a party that did not tackle bankers’ bonuses in the good times, when there were plenty to tackle, and seems to have found them now as a cash cow that can be used many times—this is the sixth or seventh time the Opposition have proposed using that source of finance. They did not tackle bonuses then, yet they did abolish the 10% tax rate, which they seem to have forgotten about. Many women and low-paid workers were on that tax rate. Indeed, when I was knocking on doors during the 2010 election, many people told me that after that rate was removed it was hardly worth them working. There are still people caught in that trap, which the Opposition have collectively forgotten about.
The Labour party has also collectively forgotten that companies have been disadvantaged by the regulations it put in place. For example, Bombardier could not competitively tender because of the regulations that Labour put in print, which resulted in job losses. Unfortunately, it also presided over the lowest number of social house starts for decades. I read with interest that it now proposes building 25,000 affordable homes—again using the bankers’ bonuses—but with no new funding of the sort that my right hon. Friend the Minister for Housing and Local Government has rolled out. At least this Government are making new funding available, rather than relying on the ever-flexible bankers’ bonus.
Mrs Main
No, I shall not give way.
I am also amazed that the Labour party, while talking about wanting to attack bankers’ bonuses, was so lacking in its support for what our Prime Minister had to do last week, which was to defend London against being raided by the European Union. They do not seem to want to do that either. I can tell Opposition Members that many bankers and wealth generators in the City would otherwise have upped sticks and gone, and there would be no bonuses for them to use in this flexible way.
Labour Members are asking us today to believe their statistics—this from a party that spectacularly underestimated the number of people who would come to the UK through its failed immigration policy at only 5,000. If they looked back at the figures, they would see that they completely underestimated the number of people who chose to come to Britain to work, so I have little faith in the statistics they regularly wheel out. They left us with the highest number of workless households in Europe and only now are coming up with ideas on how to fix that. It bears no credibility. They propose spending bankers’ bonuses multiple times and have few other ideas on how to fix the failed and broken economy that we inherited. They left this Government the note stating that they had spent all the money, but they had in fact mortgaged it. They mortgaged the future of many young people in this country.
I have only a few seconds remaining. If the Government were not taking these tough choices, more and more young people would be looking forward to a fruitless future without hope of social housing or affordable housing, because, unlike this Government, the Opposition had no appetite when in government to tackle the problems, and now they carp from the sidelines and apparently come up with solutions to fix the problems they created.
Mr Denis MacShane (Rotherham) (Lab)
I am disappointed by the previous speech, because it repeated the yah-boo exchanges on what is, frankly, a generalised crisis that has touched us all. The notion that it is all the fault of either the previous Government, or of everything that has happened since May 2010, is simply not valid. In 2008, I wrote in The Daily Telegraph a letter to my right hon. Friend the Member for Kirkcaldy and Cowdenbeath (Mr Brown) stating that we should cut spending and taxes, and he ignored me, but the year before the right hon. Member for Tatton (Mr Osborne), then the shadow Chancellor, wrote in The Times that the model Britain should emulate was that of Ireland. I think that I was right, and I hope that Government Members think that the Chancellor was completely and utterly wrong.
In Rotherham we received news today that 597 more people are unemployed than there were this time last year, which is an increase of about 15%. This is profoundly serious, with families now facing a miserable Christmas.
I do not blame all those problems on this Government—it is absurd to do so. Around the world, we are facing a generalised crisis of the market economics—or, if one prefers, capitalist—model. There is Government debt but, as the remarkable graph put up on last night’s “Newsnight” by Miss Vicky Pryce, the distinguished economist, showed, there is far greater private debt. Everybody is going through the detoxification problem of getting out of debt, and we do not know how to handle it. Niall Ferguson—a distinguished conservative, right-wing historian—writes in Newsweek:
“In normal times it would be legitimate to worry about the consequences of money printing and outsize debts. But history”—
he is writing about how people handled the 1929 Wall street crash and the 1931 Credit-Anstalt crash; there was not one general crash but two—
“tells us these are anything but normal times.”
When Monsieur Hollande, the French Socialist candidate whom I wish to see elected President of France, says that we should be looking at spending more money and at job creation measures, he is shouted down, but I think he is right. Frankly, the Conservatives ought to be in their own little Euro-heaven. We have conservative Governments and conservative presidents of the Commission, the Council and the Parliament proposing fiscal austerity, balanced budgets, making the poor pay, and protecting bankers and the rich. I thought that that was classic liberal—in the Manchester sense of the word—Conservative policy. I do not know why the Conservatives are at odds with Europe, because Europe is doing exactly what they are trying to do with the policy that is having such disastrous consequences in this country.
We look to the BRICs—Brazil, Russia, India and China—but growth in them is slowing down. Today’s figures from the IMF show that Russia, South Africa and Brazil have 3% or 4% growth and China and India have below 10% growth. There is a generalised crisis of world market economics. The United States is in disarray. The United Kingdom is part of the problem as well. We are not the solution to the European crisis—we are intimately part of it. There is no growth, no demand, increasing unemployment and increasing debt.
I am not going to say that this is all the fault of decisions taken since May 2010. I wish we had a Chancellor of the Exchequer of the maturity of Nigel Lawson, Geoffrey Howe or Denis Healey; it is rather disappointing that we have a PPE graduate from Oxford who has just done a little bit of political research in his life. We are going to have to work these problems through internationally.
“No man is an island, entire of itself”,
as John Donne said; every man is a piece of the continent. We will have to find global and European solutions to this crisis or, believe me, we will all be sunk.
Mr Robert Syms (Poole) (Con)
I agree with the right hon. Member for Rotherham (Mr MacShane) that the world did not start in May 2010. There are 30 million people in the work force, and when they were educated, what they were educated in, and how they have skilled themselves throughout their lives makes a very big difference to their employment prospects today. Therefore, whoever the Government are, they are, to some extent, presiding over the legacy of previous Governments.
We all know that, as a country, there are some things we have done well and some things we have done badly. Being out of work is a tragedy for anybody, but over the past 10 or 20 years, this country has not done too badly in keeping unemployment levels below that of many countries in Europe. In Spain, for example, unemployment is at horrific levels. Where we have got it wrong is in having, for understandable reasons, a welfare system that has sometimes become a disincentive for people to take jobs. In the Government’s reform of the welfare system—I hope that it turns out on time and to plan—they are trying to take away the cliff edge from those who are out of work and perhaps not well skilled enough to get a high-paid job so that they can take a job because it is worth their while to do so. That is a very important part of the future of our nation. Over the past 18 months, we have still had people with skills coming in from abroad and taking jobs. Under the last Labour Government, about 2 million jobs were taken by people coming in from abroad. That meant that we have not been able to motivate our own people to take those jobs. Welfare reform must be part of that.
We must look at our education system and put a lot more effort into technical education. Since Beveridge and the Education Act 1944, this country has not done as well as many of those on the continent, particularly the Germans, in technical education, which was never properly developed. When I look at Germany, I am impressed by how well respected people are who have a good technical education and by how workers are trained to provide a highly skilled work force. The success of the German economy has a lot to do with that.
What the Government are doing about training and in trying to recreate the apprenticeships that fell into disrepair is very valuable. When I go around companies in Poole, including many successful companies, the managing directors are often not degree candidates, but people who started on the shop floor with an apprenticeship in engineering and have skilled themselves up throughout their lives. Unless we get back to having good technical education, I fear we will not produce a generation of decent managers and keep the standard of living that we want.
Welfare, training and education therefore need to be part of the picture. However, we need to have a stable economic environment for people to invest. We inherited a big deficit and it will take some years to sort things out. Things do not happen in a straight line. There will be good years and bad years, and good Budgets and bad Budgets. Clearly, this is one of the years when things are going a bit slower, and I suspect that over the next four or five years, there will be years when things go a bit better. I hope that, over that time, we can create enough jobs to take up the slack of the public sector and that we can provide people in this country with a decent living, but it is going to be hard.
Nobody in this Government underestimates the task. We have a coalition of two parties that agree that we need to sort the country out and to provide more opportunities. It is a moderate coalition of sensible people and I think that it will succeed in the end, but it may take all five years before people make a sensible judgment about whether we have succeeded.
Julie Hilling (Bolton West) (Lab)
I want to tell the House the story of Chris, a young man in my constituency. I know his story only because a friend of mine gave him a lift home last night.
Chris works at Currys in Bury. Because his boss would not let him leave five minutes early, he had a 40-minute wait for the bus. Usually, when he gets into Bolton he has to catch two more buses. The whole trip takes him two and a half hours each way. If it had not been for my friend last night, it would have taken him nearly three and a half hours to get home. It is not as though it is a great job. He has a contract for six hours, which he believes is so that his employer can get rid of him easier. However, as he says, any job is better than none. It is no wonder that Chris is desperate to keep his job. With more than six people fighting for every vacancy in Bolton West, he knows that he is lucky to have anything.
People in my constituency are scared: scared that they will lose their jobs, scared that they cannot afford to pay their bills and scared that they cannot see anything getting any better. The Prime Minister is proud to state that interest rates are at an historic low, but he forgets to tell everyone that he inherited low interest rates. The much more important measure of the health of our economy is growth. What do we have? We have no growth, borrowing up, ever-rising unemployment and cuts to the public services that we all rely on.
The figures today show that the Government’s policies, like so many people in Britain, are just not working. The economy is flatlining and ordinary people are paying the price. It is back to normal business for the Tories—the rich play and the poor pay. The Government want to blame everyone but themselves—it is our fault, it is the snow, it is the royal wedding, it is the euro. It is time that they took responsibility for their actions and time they accepted that their plans are ruining Britain and ruining the lives of people in my constituency.
It is not just young people who are suffering; long-term unemployment among the over-50s is up by 20%. Just at the time when people should be able to relax and enjoy their lives, and when they should be able to plan for retirement, they are thrown on to the scrap heap.
I have told the House before about the 10 years in the ’80s and ’90s when I worked with unemployed young people. That was the last time the Tories thought that unemployment was a price worth paying. I have told the stories of the young people who took their own lives; the young people who turned to drugs and alcohol; the young people who developed long-term mental health problems; and the young people who spent many years unemployed. It is the truth that when the economy eventually recovered, employers preferred to take on the 16-year-olds who were fresh out of school than the 26-year-olds who had spent most of the previous 10 years out of work with nothing to do and nothing to get up for. Those stories of 15 years ago are starting to repeat themselves. If the Government continue to follow their failed policies, we will have another generation with no jobs, no hope and no future.
The Government also ignore the health costs of unemployment. Unemployed people are twice as likely to have a psychological illness than those who are employed. Many studies in the ’80s and ’90s proved the links between serious diseases of major organs and unemployment. It is true that unemployment makes people ill.
The Government talk about making it easier to hire people, but in truth they mean making it easier to fire people. There are people in my constituency who are not only worried about their employers’ economic future but doubly worried that their terms and conditions could be changed on a whim and that they could be fired despite doing nothing wrong. How can they buy a house or make another major purchase that would get the economy working when they are fearful for their future?
I do not believe that Ministers get it. They do not understand the reality of people worrying about losing their job, or their fear of not being able to feed or clothe their children. It is not too late to change tack and, for the sake of our constituents, the Government should do so.
John Glen (Salisbury) (Con)
In my constituency, 997 people are unemployed, which represents 2.3% of those who are economically active. I recognise that that is a modest number compared with many constituencies, but it is an absolute tragedy for every single one of those individuals, particularly the 85 who have been unemployed for more than 12 months.
I agree with much of what the hon. Member for Bolton West (Julie Hilling) said about the tragedy of unemployment. It means a loss of self-esteem, poor mental health, losing the pattern and discipline of work and losing hope. Listening to the debate this afternoon, I have found it very difficult to take the charge that all Government Members believe that unemployment is a price worth paying. I do not, but I do believe that it is a very sad economic reality.
The question is how the Government should respond. Should they act as though they have all the solutions and can essentially buy a load of jobs to relieve the misery overnight? Would that be a sustainable solution for the affected individuals in six, nine or 12 months’ time? I do not think so.
Looking back to before the general election, I am certain that elements of the future jobs fund were worth while. However, when the Government are constructing a national scheme for getting people into work, there comes a point when they have to consider whether such a programme is the most cost-effective way of delivering sustainable skills and jobs that will lead people to full-time employment for many years.
John Glen
I will not, because I want to give colleagues an opportunity to speak.
I believe that two significant matters need to be examined: supply-side reform and macro-economic stability. Many Members have already spoken about the excellent apprenticeship schemes, the work experience programme and the reforms under the new youth contract, but we need to recognise that if small businesses, such as the many micro-businesses in my constituency, are to be confident enough to take on new people, they need to feel that the Government are on their side. They need to know that the Government understand that they do not need so much regulation. They do not need the 14 new regulations a day that they had under the last Government. They want to know that we will exempt micro-businesses from new business regulation and EU accounting rules. Such issues influence whether a small business man takes the leap and takes somebody on in these difficult times.
We also need macro-economic stability. Low interest rates are important, because they condition investment decisions and how people feel about their finances. They cannot spend money that they do not have in a way that is expensive and does not have a secure outcome. The Government will not have all the answers, but they are on the right trajectory to relieve the misery, and I wish them well.
Sheila Gilmore (Edinburgh East) (Lab)
There has been some dispute about whether the coalition Government are the greenest Administration, but they are definitely good at recycling. In particular, the Prime Minister has recycled figures about private sector jobs in the past year and a half. Today, he said that the Leader of the Opposition was recycling jokes, yet he recycles the figure of half a million private sector jobs. Initially, it was half a million in the Government’s first six months; then, it was half a million in the year since they came to power, and now it is half a million since the election. The problem is that it is exactly the same half a million jobs. Half were created in the first quarter of the financial year that started in 2010. What caused that—the actions of the Government? I think not. It was the stimulus provided by the previous Government, whom the coalition Government are so fond of rubbishing. They do that consistently. After that burst of jobs, almost nothing has happened. The promise that if we squeezed the public sector, the private sector would rise up, take the strain and create jobs is not being fulfilled. Until we and our constituents see signs of that, we will simply not believe the Government.
As well as job figures, the Government are recycling ideas. Part of their approach since the election has been to suggest that unemployment is somehow a problem of individuals—of their not being willing, skilled enough or having the financial incentive to work because the benefits system is so generous. I was fascinated to come across a quotation from Sir John Anderson, who was head of the then Prime Minister’s Secretariat in 1930. At a time when people were worried about unemployment, he said:
“Unemployment statistics give an exaggerated view of the magnitude of the problem”.
Why? Because
“a large number of people really abused the Unemployment Insurance Scheme”.
I do not think that many would say that unemployment in the 1930s was caused by people abusing an extremely low amount of benefit. It shows that nothing changes. The Conservative party has always said that at times of high employment. Increasingly, its coalition partners are also saying it. It was said in the 1930s and it was not true then; it is said now and it is still untrue.
That is not to say that training is not important, but it is not new, either. In Edinburgh, the city council considered employment in the first decade of this century. We had historically low unemployment at that stage, but a residual number of people were out of work, some for a long time. We considered training schemes and specialised job academies. For example, we had a health care academy and a social care academy, and we know that taking action is not always easy. The trouble with the Government is that they think they are at ground zero with many things. They imply that we did nothing and that they have sprung into life to make things better.
Yes, we need to train people properly, but training is not a job. The Work programme does not of itself create jobs. We must be absolutely clear about that.
Alec Shelbrooke (Elmet and Rothwell) (Con)
This debate is about unemployment and what can be done about it. However, the consideration of what unemployment means has been lost in some of our discussion. On Thursday, when travelling, we were delayed for an hour because someone had fallen in front of train in Alexandra Palace. I do not know whether it was a suicide attempt. At the weekend, we had the news in Leeds that a father had murdered his family and killed himself. Suicide is increasing and there must be a link with the economic situation. I hope that all hon. Members would deem that the personal disaster that it is.
I find it deeply offensive that Opposition Members mocked this afternoon every time Government Members said that we were trying to do something for the unemployed in this country. They are laughing at the unemployed. Do you know why you are laughing at the unemployed? Because the left has always used the unemployed as a political tool. If you keep people down, you try to use them as a tool. And what did you do in 13 years of government? You borrowed huge amounts of—
Madam Deputy Speaker (Dawn Primarolo)
Order. I understand the hon. Gentleman feels very strongly about this, but he is addressing me, the Chair. He will not use the word “you”; he will please refer to “hon. Members”.
Alec Shelbrooke
I apologise, Madam Deputy Speaker, but for 13 years, the Labour party bought jobs and did not lay a foundation for moving forward. It was left to this coalition Government—two of the major parties of this country coming together—to try to put in place the proper foundations.
The smiles of glee cannot be wiped off the faces of Opposition Front Benchers when there is bad economic news. That is reprehensible. Jobs cannot be bought by borrowing; economic stability that will last must be put in place. The difference between Government Members and Opposition Members is that we try to govern for the future of this country. Whether or not we are in power, we mean to ensure that we do what is right for this country. All the Labour party did was try to hang on to power, which is why we today face one of the biggest economic crises and the fastest growing level of unemployment in decades.
It is no good Opposition Members harking back to the ’80s and ’90s. We should not forget the very different circumstances, especially of the 1980s. The fact is that this Government have been dealt a terrible economic hand. I make the point again: it is not a Tory Government, as was said earlier, but a coalition Government of the two main parties of this country, which came together to sort this mess out. We have been mocked this afternoon. I have listened carefully and although the hon. Member for Bolton West (Julie Hilling) made a good speech, the most impassioned was by the right hon. Member for Rother Valley (Mr Barron)—he was the one who meant what he said. Other than that, unemployment has been used as a political football.
Grahame M. Morris
If the hon. Gentleman is advocating a particular course, he might give his opinion on this question: would he pay his 15-year mortgage off in five years if it meant sending his children to school hungry and without shoes?
Alec Shelbrooke
My response to that rather strange analogy is that if we were to follow the route taken by the Labour party, interest rates in this country would rise, hard-working families up and down the country would be paying another £1,000 a month on their mortgages and their children would go to school hungry, because of the folly of Labour’s policies.
We have only to look at events around Europe. A 40% cut in public sector wages was proposed in Greece, but Ireland cut public sector wages by 15% to get on top of things, and yet all the Opposition say is that we should spend more money and buy jobs. That does not lay the foundations to move this country forward.
Julian Sturdy (York Outer) (Con)
My hon. Friend is making a powerful point. As a fellow Yorkshire MP, does he agree that if we are to tackle unemployment in the north, we must tackle the north-south divide, which sadly widened under the previous Administration?
Alec Shelbrooke
I could not agree more with my hon. Friend. We could list example after example of when infrastructure spending was removed from the north of England and brought down to marginal seats in the south in what can only be described as an attempt to hang on to power, not operating in the best interests of this country.
A bit of humility from Opposition Members would not go amiss in this debate. Very few Opposition Members have this afternoon spoken about trying to tackle the problem. I go back to where I started: when someone becomes unemployed, it is a massive tragedy for that family. Where will they find the money to pay the bills? Where will they find the money for Christmas? It is no wonder that there is a rise in suicide rates. Opposition Members should not dare say that Government Members believe that that is a price worth paying. We do not. We believe that we need to put in place the strong foundations for an economy that will work in the long run, and that will work for generations beyond the one that has been terribly let down by the previous Labour Government.
Grahame M. Morris (Easington) (Lab)
I rise to support the motion in the name of my hon. and right hon. Friends on the Front Bench. We are aware of the national figures, so in the limited time that I have I will concentrate on the picture as it affects Easington and the north-east region.
As Opposition Members are aware, the north-east has suffered more than perhaps any other region. Unemployment currently stands at 11.7%. In both the public and private sectors, unemployment is rising unabated as a direct consequence of the Government’s policies.
As we already know, the public sector is losing jobs more than 13 times faster than the private sector can create them. We were promised a private sector-led recovery. We were told that the public sector jobs that have been lost in the north-east—we have lost more than 32,000 so far—would be replaced by a growing private sector. That clearly has not happened over the past 12 months.
The latest job figures show that the north-east has lost a larger proportion of jobs than anywhere else in the country. We have 6,000 fewer jobs in the construction sector compared with the same period last year. Clearly, Government policy has had a direct impact on the private sector. Cutting infrastructure projects and the Building Schools for the Future programme has hit construction jobs. The figures produced by the northern TUC show that the public sector is losing 2,000 jobs a month.
As my hon. Friend the Member for Stockton North (Alex Cunningham) mentioned, the Conservative Government of the 1980s and early 1990s bear a heavy responsibility for the worklessness that exists in areas such as mine. When the traditional industries were still operating—in my case it was coal mining—the numbers of people who were employed were high and the numbers on benefit were relatively low. It was not until the pits closed that we saw significant increases in unemployment and incapacity claims. As hon. Members have already said, there is a human cost to unemployment. After closing the pits in Easington and in the north-east, the Conservatives left villages, towns and entire communities without work.
Ian Lavery (Wansbeck) (Lab)
Does my hon. Friend agree that the unemployment statistics in Easington are very similar to those in Wansbeck? In my constituency, there is in excess of 30 people applying for each job vacancy and that is intolerable. The Prime Minister has kept one of his promises: before the election, he said that the north-east would be hit the first and hit the hardest.
Grahame M. Morris
Indeed. I share my hon. Friend’s concerns, and that has certainly been the case. We are facing a worsening of the north-south divide. It is also the case that the north-east has faced some of the worst increases in unemployment across the UK. The hon. Member for Salisbury (John Glen) said that there were 1,000 people out of work in his constituency. There is more than three times that number in my constituency. The number of 18 to 24-year-olds out of work in Easington has increased by 65%. For the over-50s, the figure is up 58%, which is just as concerning. The situation for those out of work in the north-east is much bleaker than in many other regions.
Unemployment and worklessness are not evenly spread across the country. Indeed, they are concentrated in particular pockets, largely the older industrial areas of the north-east, Merseyside, Scotland and Wales, and that makes unemployment far harder to deal with. I should like to commend the excellent work carried out by Professor Steve Fothergill and his colleagues at Sheffield Hallam university in identifying some possible solutions. I know that time is short, so I will bring my speech to a close.
There are real concerns about the Government’s intentions in relation to workfare. If jobs exist, why are they not being offered as real jobs with real wages? We need a plan from the Government for jobs and growth. Our Front-Bench team has a five-point plan to kick-start the economy, but the Government could go further. There are some helpful suggestions from the Institute for Public Policy Research for supporting employment, and I raised them with the Minister of State, Department for Work and Pensions, the hon. Member for Thornbury and Yate (Steve Webb), in a recent Adjournment debate. I would point out, however, that the Government’s promises on jobs and growth are as hollow as a chocolate Father Christmas.
Fiona O’Donnell (East Lothian) (Lab)
I want to begin by answering some of the accusations made by the hon. Member for Elmet and Rothwell (Alec Shelbrooke). I do not think that it is a price worth paying to see the failure of this Government just so that we can get any kind of political advantage. He should have withdrawn his remarks—Members were not laughing, we were saying that the Government’s plan is not working.
Jobs and employment are the biggest issue in my constituency and the latest figures now show that just under 2,000 people are claiming jobseeker’s allowance and chasing 191 vacancies in East Lothian. That means that if every Member sitting on the Government Benches went for a job, only one would stand a chance of getting one.
I also want to address the comments made by the hon. Member for Cardiff Central (Jenny Willott). She spoke about the voluntary sector and her contribution contained a lot of sense and value. I concede that Government Members care about unemployment. I have no doubt that when the Secretary of State for Work and Pensions went to Glasgow East and saw what poverty and deprivation did that he was genuinely moved, but I think there is a real gap when it comes to introducing policies and systems that help and support people in getting out of poverty and long-term unemployment. The Government talk about the voluntary sector playing a role when they are cutting the public sector, but the voluntary sector, which played such an important role in the future jobs fund, is now less able to respond to people’s needs.
The hon. Member for St Albans (Mrs Main) made the most unhelpful remark in the entire debate when she said that the Prime Minister went to Europe to stand up for London. I remind her—even the Prime Minister knew this—that there are financial services sector jobs across the United Kingdom, not only in London.
Fiona O’Donnell
I will give way, but I am going to try to be disciplined and not take the extra time.
Fiona O’Donnell
What I had really hoped for was a little humility. We have been preached to about humility, but the hon. Lady completely failed to recognise that there are financial services sector jobs in other parts of the country. My constituency is heavily dependent on the financial services sector in Edinburgh, and we will see what happens. The signs since this Government came into office have not been good.
The Government offer us the Work programme. I have been to visit the providers in my constituency. A woman opened up a spreadsheet and said she was not sure whether she was meant to show me it. It was, in effect, a profit and loss account showing at each quarter how many people the providers need to help into work to get a return on the payments from the Government. The most depressing thing was seeing the percentage they expected not to find their way in to work at the end of the two years.
My fear is that providers will not invest the resources in supporting that percentage, whom we could probably all identify when they walk in the door, when they are the very people who need more help and support to take them back into work. This is where the Government do not get it.
I remember during the 1997 general election knocking on a door and meeting a woman who was still in her pyjamas in the early afternoon and trying to convince her that she could get out, vote Labour and make a difference. She did not even have a reason to get dressed. When Government Members hear of a case like that, they think in terms of a drain on resources, and resentment and a grudging feeling come over them. They do not think about how to support someone like that and what it might mean for someone to have reached that low point in their life when they do not think that they have any contribution to make to society.
I am also particularly concerned about the increase of 55% in the number of young people in my constituency who have faced no prospect of finding work since this Government came into power. The future jobs fund gave them hope. Government Members keep yelling that it did not lead to real jobs, but the hon. Member for Cardiff Central, to give her credit again for bringing some reason into the debate, talked about the elements of the fund. She described eloquently how it helped young people to break the habit of not getting up in the morning, to gain self-esteem and to feel not only supported but understood.
We take no joy in the Government’s failure to address the needs of people who are seeking work, or to create the jobs that could lift them out of poverty. It is not a price worth paying for the political advantage that we are benefiting from.
Nia Griffith (Llanelli) (Lab)
The latest unemployment figures are absolutely shocking: 133,000 in Wales alone; and, in some areas such as the Rhondda, 20 people are chasing every single job vacancy. As we look around our constituencies, we see people losing their jobs because of the Government’s savage cuts to public services, and because private firms that thrived on public procurement are seeing their order books empty. We see people losing jobs in the private sector because consumer confidence is low and demand is down, and we just need to look at our high streets and town centres to see shops closing, including those of big household names and local businesses.
If any programme to get people back into work, such as the Work programme, is going to be successful, and if people are going to have a chance of getting a job, the Government need to get their act together and get a growth strategy—now, before it is too late; now, before any more firms go bust; now, before any more shops on our high streets close; and now, before any more families suffer the scourge of unemployment.
But we see nothing from the Government that will stimulate consumer confidence or demand. On the contrary, we have seen this shameless coalition Government hike VAT up to 20%, despite the fact that just before the election, in April 2010, the Conservatives and the Lib Dems vigorously denied any intention of increasing it. Now, they are ignoring Labour’s calls to cut it.
The Federation of Small Businesses has described the Government’s abysmal attempts at a growth strategy as
“too timid and out of touch with the reality of the UK’s sluggish economy.”
Indeed, back in July the British Chambers of Commerce said that the Government’s deficit reduction plan was
“already dampening demand and adding significantly to the pressures facing businesses and individuals.”
It called on the Government to strengthen their efforts to stimulate growth. Did the Government listen then? No. Are they listening now? No.
We have not seen the long-term strategies or the certainty that firms need in order to invest. Let us take the feed-in tariff fiasco. In my constituency alone, we are losing many jobs, because a new policy has been introduced in only six weeks, just like that, meaning that nobody has the confidence to put up the £10,000 to install solar panels on their roof. What other scheme do the Government have in mind whereby people put up £10,000 up-front to help to secure jobs in their local economy? I do not think they have one other idea.
In Wales we can show Members a better way—the one mentioned in the motion before us is being put into practice by the Welsh Government. The Labour Government in Wales are creating 4,000 jobs a year for young people in the private sector through the Jobs Growth Wales programme; helping to create jobs in the construction sector by continuing to build schools and houses; and helping businesses by making £55 million available in grants and loans to them. The problem, however, is that the Welsh Government are having to do this against the background of UK Treasury policies, which are making it very difficult for any business to flourish. We have a Chancellor who is determined to suck money out of our local economies, making it extremely difficult for local businesses to keep going.
We all know that people on the lowest and most modest incomes spend their money most rapidly in the local community, because they have to for their day-to-day needs, so let us look at a few examples of how the Government are squeezing hard-pressed families and sucking money out of our local economies. First, there is the VAT hike, which I have mentioned.
Secondly, there is the winter fuel allowance. Most pensioners, certainly in Wales and in many unemployment hot-spots across the UK, are not millionaires but need that £100, so they are transferring money that they would have spent in the local economy and putting it by to pay for their fuel. That money is leaving the local economy, with the economy in Wales alone losing some £31 million.
Thirdly, we have real cuts dressed up as freezes, such as those on public sector pay and on child benefit, and they are translating into money that people do not have to spend in the local economy. Fourthly, the 3% hike in pension contributions is taking £2.8 billion out of the economy; and fifthly, tax credits are being taken away from people who work less than 24 hours a week. But people just cannot, unfortunately, get those hours, and they are from some of the very poorest households. They are trying to work and to keep the family together, yet they are going to have even less money to spend and less money to stimulate the economy, so there are going to be even more job losses. The Government must do something now to put that right and get growth going.
Geraint Davies (Swansea West) (Lab/Co-op)
The last Labour Prime Minister will be remembered in the economic history books as the man who in 2008, alongside President Obama, averted a depression of a 1930s quantum by invoking a fiscal stimulus. The current Prime Minister may well be remembered as the Prime Minister who prematurely used his veto to stop Europe putting together a plan to promote economic stability and growth, and avert a crisis in the euro and a national sovereign debt crisis across Europe. We all know that we did not want the financial transaction tax, but that could have been vetoed at a later date.
We have a deficit, as we all know, two thirds of which was the responsibility of the international financial markets and the banks. The remaining third was due to the excess investment over earnings of the Labour Government. There should be no apology for that, because that investment was in lower VAT, the car scrappage scheme and so on, which stimulated growth on the back of what could have been the worst depression since the ’30s, and reduced the deficit forecasts by some £22 billion. With the change of Government there was a change of focus, from growth to cuts. Growth has now stopped. The immediate judgment of the new Chancellor was to announce 500,000 job cuts and, for instance, 7% cuts in local government for four years. That meant that everyone in local government thought they were bound to lose their jobs and therefore stopped spending. The reduction in consumption and spending has meant a depression in growth. Now the deficit forecasts are not going down, but going up. They went up to £46 billion, and now they are £158 billion.
As for business and inward investment, the Chinese are coming to Cardiff tomorrow. They are concerned about a country whose growth is flatlining, which has strikes and riots provoked by the Government parties’ policies, where crime is rising for the first time and waiting lists are going up—again, through cuts—and where the educational standards of those going to university are beginning to fall off. In other words, this dualist idea—that if we get rid of the public sector, the private sector will be all right—is completely fallacious. The Labour party has a five-point plan. For example, the VAT change would stimulate £46 million in the local economy in Swansea, helping to create new jobs, while lower national insurance rates would also be helpful in stimulating building businesses.
I should mention that the interest rates that we now enjoy are thanks to the Labour Government making the Bank of England independent. We remember the last time the Tories were in, when interest rates hovered between 10% and 15%, so I will take no lessons from the Conservatives about how the austerity plans and unemployment are the reason for low interest rates. In fact, since the summer, interbank borrowing rates—that is, wholesale rates—have increased by 1%, so small businesses are suffering.
Finally, there is a glimmer of hope for the future in Swansea and Wales, thanks to the standard and quality of research and development in both our universities, which are working with UK Trade & Investment to network into international markets. However, with an enterprise zone in Bristol, parked on the gateway to Wales, we are not helped, frankly, by the continuation of rising tolls on the Severn bridge, especially when we see them being cut on the Humber. That is basically leading to disinvestment in many investment projects, whether in St Athan or the Severn barrage. There is hope, but we need a refocus on growth, instead of an endless focus on cuts. Anyone who runs a business that is making a loss needs to focus on revenue, not just cutting everything. The Government need to think again and remember the success of the previous Labour Government.
Kate Green (Stretford and Urmston) (Lab)
Let me make a few brief points. There is a lot of emotion and pain about rising unemployment, for the many reasons that were eloquently expressed by many Members from across the Chamber, including, as the hon. Member for Elmet and Rothwell (Alec Shelbrooke) said, my hon. Friend the Member for Bolton West (Julie Hilling) and my right hon. Friend the Member for Rother Valley (Mr Barron). We make those emotional points strongly not because we want to re-fight the class wars of the 1980s and 1990s, but because we want to ensure that we learn to understand the impact of letting unemployment rise unchecked without properly and effectively intervening. I therefore hope that Government Members will not misinterpret me when I say that one of the things that we should learn about—in addition to what happens when whole generations are lost, along with the insult and disrespect that they feel—is what that leads to, in terms of alienation and the kind of behaviours it can drive. When we look at the lessons from the interim report of the official inquiry into the riots, I hope that we will take note of the rising sense of alienation among our young people and ensure that our employment policies specifically address it.
I want to ask a couple of questions about the Work programme. It cannot resolve the shortage of jobs, but it can prepare people to be better able to take the opportunities if and when they are made available. It is a matter of great regret to many Labour Members that there is so little transparency about how the Work programme is performing.
I hope that the introduction of the wage subsidy, which it seems might be related in some way to the operation of the Work programme, will not mean a double payment to Work programme providers or a double cost to the economy. I hope the Minister can reassure us on that. I hope, too, that he will say something about whether providers continue to see Work programme contracts as viable. Providers in my region are certainly expressing the concern to me that the lack of jobs means that it will not be possible for them to carry on without coming back to have further discussions with the Government about the payment structure and rewards built into the contracts. We need to know just how Ministers see the economic and financial viability of the Work programme in these very different economic circumstances from those in which the contracts were designed and let.
The Minister should acknowledge that the payment structure in the Work programme does not reward people only for getting someone a job and keeping them there for two years. There should be interim payments all the way through. When we look at the way in which people are moving into employment, I am particularly concerned that we do not move them just to short-term, stop-go, sporadic episodes of employment, whereby Work programme providers pick up some of the payment and redesign their model to make it sufficiently economically viable for them to keep the contract manageable, but do not deliver the sort of long-term sustainable jobs that I think we all want.
Finally, let me support the comments of my hon. Friend the Member for Llanelli (Nia Griffith). The Government have tools at their disposal not to make the situation worse. I ask them to look urgently at two aspects of tax credits. The first is about the operation of the rule that, as my hon. Friend said, requires couples to work a minimum of 24 hours. We know that employers are not able to offer more hours in the current economic climate, and that rule is going to drive people out of the workplace. I also ask Ministers to look once again at the operation of the child care element of working tax credit. Aviva has shown us that about 32,000 women are leaving the workplace because they cannot make work pay. That is a false economy, and I hope Ministers will—
Stephen Timms (East Ham) (Lab)
We have had an interesting and worthwhile debate.
In June last year, the Prime Minister told the House that cutting the deficit faster would revive private sector confidence. That was the basis for the whole plan: private sector investment and jobs would surge, and new private sector jobs would outweigh public sector job cuts. We now know that that plan has not worked. My hon. Friend the Member for Llanelli (Nia Griffith) and the hon. Member for Banff and Buchan (Dr Whiteford) were right to underline that the key assumption that confidence would surge has proved to be wrong. The new “Business Confidence Monitor” from the Institute of Chartered Accountants says:
“UK business confidence has collapsed…Confidence has declined across all sectors and all regions.”
My right hon. Friend the Member for Rotherham (Mr MacShane) was right to underline the seriousness of the crisis we face.
Nobody claims that the coalition strategy has worked to boost confidence. We will take different views about the reasons why it has not worked, but the fact that it has not worked is beyond dispute. Public sector job cuts now far exceed new private sector jobs—by 67,000 to 5,000 in the last quarter. My hon. Friend the Member for Edinburgh East (Sheila Gilmore) was right to draw attention to the fact that Conservative Members like to look further back, closer to the election, when there were still beneficial effects from the previous policies. Today, however, private sector job creation has completely stalled.
The Office for Budget Responsibility tells us that more than 700,000 public sector jobs will go; already, for the first time, more than a million young people are out of work. My hon. Friends the Members for Ynys Môn (Albert Owen), for Stockton North (Alex Cunningham) and for Easington (Grahame M. Morris) pointed out what that means in communities around the country.
What are the Government doing? Not long ago, the Minister of State, Department for Work and Pensions, the right hon. Member for Epsom and Ewell (Chris Grayling) told us that all this fuss about youth unemployment was a distraction.
Chris Grayling
May I ask the right hon. Gentleman, who is a decent man, to go and look at the original quotation? If he does so, he will find that I said that the actual figure for youth unemployment was 730,000. The 1 million figure is not a true reflection of the position, because it includes a large number of full-time students looking for part-time jobs. I do not count those as being unemployed.
Stephen Timms
The Minister should take that up with the Office for National Statistics.
Last month the Government finally recognised that they had to do something and announced the youth contract, but they have not made up their minds about the details. There appears to be some haggling with the Chancellor about how it will work, and it is clear that the Government’s providers have no idea how they are supposed to be delivering it from next April. A year after the Deputy Prime Minister said—so he tells us—that something needed to be done, there has still been no action.
Although we do not know the details, we can say one thing for sure: it was folly to scrap the future jobs programme and allow youth unemployment to rocket. As was recognised by my right hon. Friend the Member for Rother Valley (Mr Barron), my hon. Friends the Members for Bolton West (Julie Hilling) and for Stretford and Urmston (Kate Green), and, indeed, the hon. Member for Salisbury (John Glen), a generation of young people will bear the scars of that folly throughout their working lives because Ministers were asleep at the wheel. All along, we were assured that the solution would be in the Work programme—that it would solve all the problems—but the truth is that the programme was rushed and inadequately planned. As we pointed out at the time, there needed to be a plan for transition from the previous programmes to the new one, but there was no such plan.
So how has the Work programme fared? As my hon. Friend the Member for Stretford and Urmston pointed out, Ministers have gone to extraordinary lengths to block the publication of data about what it is achieving. I am told that officials have threatened Work programme providers that if they publish any figures, they will lose their contracts. I well understand the concern of the provider in the constituency of my hon. Friend the Member for East Lothian (Fiona O'Donnell) who said, “I should not show you this, because if I do I may lose the contract.”
Absurdly, the Minister of State claims that the purpose of the ban was to meet the requirements of the United Kingdom Statistics Authority. As we have been reminded, he has some form with the authority. However, its chairman wrote to me last week:
“The Statistics Authority has not been consulted on whether it would be appropriate for Work Programme providers to publish their own performance data.”
It was the Minister's decision to hush things up, not that of the United Kingdom Statistics Authority. As I told the Minister yesterday in Committee, the same organisations published their performance data in the flexible new deal, under the same United Kingdom Statistics Authority rules. They actually want to tell people what is going on and what is happening. The Minister must lift the ban.
According to the foreword to the White Paper “Open Public Services”, signed by the Prime Minister and Deputy Prime Minister in the days when they used to agree with each other,
“it is only by publishing data on how public services do their jobs that we can wrest power out of the hands of highly paid officials and give it back to the people.”
How true that is, but in this case the Minister is resolute: they shall not know.
As it happens, it is possible to glimpse how the programme has been going by looking at the number of people coming off benefit each month. It is no surprise that the number plummeted in May, when the flexible new deal ended. The fact that it continued to be low as the Work programme got going should also have been no surprise, because that always happens. If we compare the months after May with the same period last year, we see that poor Work programme performance resulted in an estimated 86,000 people who should have obtained work not obtaining it. That is probably a permanent unemployment rise. The damage will be with us for years.
Incidentally, to deliver that worse performance, the Government had to pay out millions. I have heard that they had to pay tens of millions in penalty charges for early termination of flexible new deal contracts. I wonder whether the Minister can tell us how many millions of pounds the Government had to pay to prevent those 86,000 people from obtaining jobs.
The Government told us that the Work programme would enlist an army of voluntary organisations to give specialist help. To begin with, we were told that 508 voluntary sector organisations would be involved. By August, the number had fallen to 423. I met a group of them last month—superb organisations such as St Mungo’s, with a great track record in helping homeless people into work. They had agreements with three different prime providers in London. How many people had been referred to them for help under the Work programme in the six months since it started? None—not a single person. Dyslexia Action has Work programme agreements in six different areas. How many referrals has it received in the six months since June? I checked with it yesterday. None; not a single person; nobody at all. These are good organisations. They tooled up and acted in good faith on what the Minister said. He led them up the garden path; he has not delivered. The Merlin standards that he said would safeguard them have proved completely worthless.
Others who have had referrals told us that relationships in the Work programme are terrible. Prime providers are not talking to sub-contractors; jobcentres are not talking to prime providers; and as was rightly said earlier, there are persistent rumours of serious financial problems ahead in the new year. Can the Minister who is winding up tell us what contingency plan he has for the eventuality of a Work programme provider failure? The Minister of State, Department for Work and Pensions, the right hon. Member for Epsom and Ewell has indicated that he is relaxed about that eventuality. What will the Department do if it occurs?
It is clear that we need a new approach. We have spoken about the alternative five-point plan, which my hon. Friend the Member for Swansea West (Geraint Davies) was right to underline. That, at last, would give us a chance, and it is a chance we desperately need.
The Minister of State, Department for Work and Pensions (Steve Webb)
It is important in the few minutes remaining to put on the record some of the facts about the current situation, because there is a danger that the tenor of what we have heard from the Labour party might talk down the British economy and lead to an unnecessary depressing of confidence at a time when we need realism, not talking down the hard-working people in our economy.
Let me give an example. One would hardly believe from today’s debate that since the general election, the number of people in work in this country has risen by a quarter of a million. In fact, the number of people in private sector jobs has risen by more than half a million.
Steve Webb
In a second. So when it is said that the private sector is not expanding, that is simply not right. People say that there are no jobs, but there are half a million additional private sector jobs. The hon. Lady made the point that that is looking over the whole period, so I will take her at her word. Let us look at the last month. In it, the number of people in work has risen by 38,000. Of course, we can all choose different time periods—Labour Members used the last quarter, for example—but my point is that selective use of statistics, such as that made by the right hon. Member for Birmingham, Hodge Hill (Mr Byrne), creates a highly misleading impression and talks down the British economy in a way that is in nobody’s interests.
Mr Byrne
The Minister is characteristically generous in giving way. Surely he cannot celebrate the fact that employment over the last quarter has fallen by some 63,000, and that 13 times more jobs are being lost in the public sector than jobs are being created in the private sector. He cannot tell the House today that everything is going well, surely.
Steve Webb
Of course, I did not say that everything is going well, but the right hon. Gentleman cannot deny that in the last month, an extra 38,000 jobs, net, have been created. We can choose different time periods. As my right hon. Friend the Minister of State said, the claimant count rose by 3,000 in the last month, but that is more than offset by the fact that people who were previously on incapacity benefit have been reassessed on to JSA, and lone parents have been required to look for work and moved on to JSA. In fact, without those policy changes, JSA numbers would have fallen in the last month. That is why my right hon. Friend was absolutely right to talk about signs of stabilisation in the job market.
As a number of Members on both sides of the House said—my hon. Friend the Member for Salisbury (John Glen), the right hon. Member for Rother Valley (Mr Barron) and others—every single person on the unemployment roll is a person too many, but if we overstate the doom and gloom, we talk down confidence in the economy, which is to the detriment of all our constituents.
Let me respond to the claim made by the right hon. Member for Rother Valley and others that long-term youth unemployment is up—and I quote—“93%”. Labour Front Benchers have clearly supplied all their Back Benchers with figures for their constituencies. The only problem is that all of them are wrong. Labour Members might be interested to learn that what used to happen is that under measures such as the new deal, people had to move off JSA after a certain period and were paid something else—a training allowance—or they got a temporary job; then, when they went back on to JSA, as so many did, the clock started again. Hey presto—a long-term unemployed person had been converted into a short-term unemployed person. They had not got a job; they had just been taken out of the figures. We have stopped doing that. As a result, if all the factors are taken into account—the people who were excluded from the statistics because they were on training allowances or in temporary jobs—the number of long-term claimants aged 18 to 24 is about the same now as it was in 2010.
To hear Labour Members, one would think that the numbers had doubled. The right hon. Gentleman was very angry about that, and had they doubled he would be right to be so, but they have not doubled—in fact, they are roughly the same.
Steve Webb
The right hon. Member for Rotherham (Mr MacShane) said that it was “absurd” to blame all the problems on this Government. That was gracious of him, although I take great offence at his attack on Oxford PPE graduates, but to hear Labour Members today, one would have thought there would have been no public sector job losses at all had they stayed in power. They were planning tens of billions of pounds of cuts. How many public sector jobs would have gone had they gone ahead with their tens of billions of pounds of cuts? They have no idea—no idea at all.
Several hon. Members mentioned interest rates. We were told that we inherited low interest rates, and the Bank of England base rate was indeed low. The question was what decisions did we, as a new Government, have to make to get the fiscal position under control. Because we took the difficult decisions early—pretty much every one of which has been opposed, item by item, in the course of this debate—the interest rates at which the British Government are borrowing have stayed low while other countries’ debt rates have soared. As a result, in this Parliament we have saved £22 billion in debt interest—money we can spend on services and on helping the unemployed which would not have been available had we listened to Labour.
Early in the debate, my hon. Friend the Member for Monmouth (David T. C. Davies) said that we need to tackle red tape. He is right, and we have the red tape challenge, which has already resulted in substantial deregulation in, for example, retail and hospitality, with much more to come. I am grateful to him for making that point.
My hon. Friend the Member for Cardiff Central (Jenny Willott) highlighted the fact that pension funds will now be asked to invest more in the long-term infrastructure of this country—and rightly so. It is shocking that, for so many years, the money in our pension funds was not invested in our long-term infrastructure. This coalition Government are taking action to tackle that.
The hon. Member for Stockton North (Alex Cunningham) referred to the regional growth fund money in his constituency, and I am grateful to him for acknowledging the good that it can do. He asked about incentives to take on the long-term unemployed and the young unemployed. The youth contract is being introduced so that when people take on 18 to 24-year-olds from the Work programme—so they are long-term unemployed—they will get an incentive worth £2,275. That is more than a year’s free national insurance, so it is a valuable incentive. Unlike point five of this fantastic five-point plan we have heard about, which would reward small firms that take on anybody—including someone they were going to take on anyway and who would have got a job—our incentive is targeted on the long-term unemployed. That is the crucial point. Only one person in this debate has mentioned cost-effectiveness—my hon. Friend the Member for Salisbury. The right hon. Member for East Ham (Stephen Timms) said that it was a scandal, or something, to have finished up the future jobs fund, but he should know that that fund was costing more than £6,500 per place, whereas our work experience programme costs a twentieth of that and delivers the same sort of outcomes. Cost-effectiveness simply is not on the Labour party’s radar.
In the few seconds available to me I shall not have the chance to go through all hon. Members’ contributions. My hon. Friend the Member for North East Hertfordshire (Oliver Heald) flagged up the record national debt that we were left and my hon. Friend the Member for St Albans (Mrs Main) talked about the collective amnesia of Labour Members and asked why they did not tackle bankers’ bonuses. Just before the election, they introduced a temporary bankers’ bonus tax—
Mr Alan Campbell (Tynemouth) (Lab)
claimed to move the closure (Standing Order No. 36).
Question put forthwith, That the Question be now put.
Question agreed to.
Main Question accordingly put.
Business without Debate
Delegated Legislation
Petitions
Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab)
The petition states:
The Petition of residents of Park End, Middlesbrough,
Declares that the Petitioners are concerned about the prospective closure of Park End Community Centre, which recently received £102,000 in lottery grant funding for a multi-games court, a skate park and a garden; that the Petitioners believe that this is a much-treasured community facility used regularly by residents of all ages and that the Petitioners are concerned that the closure of the centre will also have a negative impact on staff and users of the nearby Park End Medical Centre.
The Petitioners therefore request that the House of Commons urges the Government to ask Middlesbrough Council to ensure that funding for Park End Community Centre remains in place and that the centre remains open.
And the Petitioners remain, etc.
[P000989]
Diana Johnson (Kingston upon Hull North) (Lab)
I rise to present a petition of 4,385 constituents and others from the Humber area against the proposed loss of 899 skilled private sector jobs at BAE Systems in Brough. While Members will be enjoying the Christmas break, Boxing day will see BAE Systems complete a consultation process on the loss of strategically vital defence jobs in a region badly hit by unemployment and a shortage of decent jobs, as we saw again in today’s jobless figures. Over 100 of the workers met the Prime Minister and the Leader of the Opposition today. We hope that this leads to an outcome that will save as many of the jobs as possible.
The petition states:
The Petition of residents of Humberside,
Declares that the Petitioners support workers at BAE Systems in Brough in their fight to save Humber jobs.
The Petitioners therefore request that the House of Commons urges the Government to support the defence industry by investing in modern manufacturing and regeneration around the Humber and to preserve skilled jobs and apprenticeships in the Humberside area.
And the Petitioners remain, etc.
[P000990]
Tessa Munt (Wells) (LD)
I rise to present the petition of the Stop Hinkley campaign. Those who live in the area around Hinkley, particularly in Somerset, would like the Government to look at alternatives to Hinkley Point.
The petition states:
The Petition of supporters of the Stop Hinkley campaign,
Declares that the Petitioners strongly oppose the plan by EdF (Electricite de France) to construct a new nuclear power station at Hinkley Point in Somerset and declares that as an alternative, the Petitioners believe that a Government-backed programme of energy saving and clean renewable energy would combat climate change and avoid the risks of catastrophic accidents and dangers to health resulting from the storage of highly radioactive waste at Hinkley for 160 years.
The Petitioners therefore request that the House of Commons urges the Government to commit to an energy policy based on energy saving and clean renewable energy, in which new nuclear power stations play no part.
And the petitioners remain, etc.
[P000991]
Pedestrian Access (Railway Stations)
(13 years ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Paul Blomfield (Sheffield Central) (Lab)
I am pleased to have secured this debate. I admit that the subject might seem a little obscure to some Members, but the Minister will know that it is of great concern not only to people in my constituency but to all of Sheffield. I am delighted to be joined by my hon. Friend the Member for Penistone and Stocksbridge (Angela Smith) and my right hon. Friend the Member for Sheffield, Brightside and Hillsborough (Mr Blunkett). This issue has brought together an extraordinary coalition of local residents and local organisations who are united in their concern to maintain pedestrian access through our station.
I know that similar issues have arisen in other parts of the country. My hon. Friend the Member for Derby North (Chris Williamson) has shared with me his concerns from further down the midland main line. My hon. Friend the Member for York Central (Hugh Bayley), who cannot be here tonight, has shared with me the issues in his city. I know that the Minister of State, Department for Work and Pensions, the right hon. Member for Epsom and Ewell (Chris Grayling), has had problems of a similar nature at a station in his constituency.
This evening, I will explain the problem facing Sheffield and make three points. The first is that established pedestrian routes for non-rail users through railway stations should be respected and protected, not blocked by ticket barriers. Secondly, I will look at the relationship between publicly funded stations and station improvements and the franchise arrangements that have passed the management of our stations to private rail companies. Thirdly, I will challenge the one-size-fits-all approach to ticket barriers of the Department for Transport, and the implications for pedestrian access. I will draw extensively—but not too extensively—on the long-running campaign in my constituency and in the city to maintain access through our railway station. I will illustrate that railway stations are not just places where people get on trains, but can be so much more, as in the case of Sheffield.
In advance of tonight’s debate, in an experiment in participatory democracy, I invited comments from constituents through Facebook, Twitter and e-mail, and I was overwhelmed with responses. I should like to thank those who contacted me for their support, and although I apologise for being unable to use all their comments, I will draw heavily on their views tonight.
Sheffield has an open station without ticket barriers, and it is not simply a place to catch a train. It is connected to our Supertram network via a tram stop at the back of the station, and it is just one minute on foot from the main bus interchange. As my constituent, Roz Wollen, says, we have a
“joined up transport system of tram, bus and train, all linked.”
It is a model of an integrated transport hub and the only point in the city where all forms of transport come together, so the free movement of people around that hub is crucial.
The station is not just a transport hub. It sits at the bottom of one of Sheffield’s seven great valleys. On one side is the city centre and on the other are the communities of Park Hill, Norfolk Park and beyond. The railway line runs down the valley, dividing the two, and the station is the natural link between the city centre and those communities.
The bridge that runs through the heart of the station is the only pedestrian route that unites the city. As Angela Andrassy says:
“The bridge also symbolises for me the joining of our area of the city to the city centre.”
It runs from the main station concourse to the tram stop, then to the communities beyond and to key institutions such as Sheffield college and All Saints school. For residents coming the other way, it provides direct access to workplaces, shops, cinemas, theatres and Hallam university. The bridge and station, as Mark Doel says, are
“part of the civic landscape”.
That landscape has recently been enhanced by the wonderful new South Street park, built with public money, which I was delighted to open in September. Footpaths come down the hill through the park and converge on the station bridge, providing the main route to the city for the communities that I mentioned.
The bridge was redeveloped as a main pedestrian route in 2002, as part of the £50 million redevelopment of the station and the adjacent Sheaf square. That redevelopment created the modern, accessible and award-winning station that we have today and the major pedestrian gateway to the city centre. Funding came from both the public and private sectors, with the city council, the passenger transport executive, Network Rail and the European Union all contributing.
That redevelopment not only transformed the station to give train passengers a fantastic first impression of our city, but crucially opened the bridge to more than 1 million people a year, at a cost of £7.5 million, giving pedestrians a safe and secure route to and from the city centre. Frank Abel, a pensioner, told me:
“I use the bridge several times a week walking into town…At all times of the day and evening there are people going up and down the new steps.”
Gavin Bateman said:
“I use the footbridge through the station daily and my daughters use it on a regular basis. It is my contention that there is not an acceptable alternative”.
As Viv Ratcliffe, who is wheelchair-dependent, asked me to point out:
“The bridge was built to integrate all aspects of transportation including pedestrians.”
The station is not just a pedestrian gateway, a transport hub and a place to catch a train, it is increasingly a destination in its own right. In 2009 the Sheffield Tap opened at the station, and it has won awards. It is a pub that has quickly become a firm favourite not only of the Campaign for Real Ale but of travellers and non-travellers. Its arrival and subsequent success perfectly demonstrate that the station is increasingly a community hub and, in my view, a model station. As Gareth Slater points out,
“removing the bridge will damage the passing trade of the shops”
that have been developed in the station.
I echo the words of former Virgin Trains chief executive, Chris Green, and the president of the Town and Country Planning Association, Sir Peter Hall, who wrote in the introduction to their report for the Government in 2009 on how to improve our railway stations:
“Stations are deeply entwined with their local community and effectively act as the gateway to both town and railway. They leave passengers with their lasting impressions of both.”
Sheffield station’s success is, however, entirely predicated on its being an open station, with pedestrian access right through it. When East Midlands Trains took over the management of the station in 2007 under a new franchise from the Department for Transport and signalled its intention to install ticket barriers across the bridge to tackle fare evasion, there was considerable local anger.
Ticket barriers will block pedestrian access through the station and close the bridge to all but train passengers. Since 2007, the Department for Transport has put pressure on EMT to install barriers, but I am pleased to say that, so far, it has been unsuccessful, not least because of a tremendous campaign against barriers led by the campaign group Residents Against Station Closure—RASC. For more than four years, it has thoughtfully and thoroughly pursued the issue through lobbying, campaigning and regular creative demonstrations. Indeed, this Friday its festive protest will involve seven Santas with their reindeer—[Hon. Members: “Are they real?”] I am not sure whether they are live reindeer, but that is the theme. They will cross the bridge and give out chocolate coins to children, as a reminder that public money built the bridge.
I have worked with RASC for most of the past four years, long before being elected to this place. I pay tribute to its members for their energy, leadership and ability to mobilise extraordinary support across the city and the political spectrum. They do not stand alone. In an online poll conducted by Sheffield council in 2009, 94% of people said that they opposed ticket barriers. All political parties in Sheffield, along with local schools, pensioners, neighbourhood and transport groups have signed up to oppose the barriers. Indeed, earlier this afternoon, the Deputy Prime Minister sent me a note, apologising for missing this, the second most important debate of the week, but saying that he
“continues to urge the DfT to come to a practical solution with the train company and Sheffield City Council which will allow pedestrians to continue to be able to use the bridge.”
Institutions that are key to the city’s economic and social fabric support the campaign to keep the bridge open, including the chamber of commerce, Hallam university, Sheffield college and Sheffield International Venues. They know that breaking up the city’s transport infrastructure is bad for business, and makes Sheffield a less attractive place in which to work, study, live and invest.
Furthermore, the £150 million scheme, which is transforming the iconic and grade II* listed Park Hill flats—the largest listed structure in Europe—creating 874 new apartments and breathing new life into this part of the city, will be cut off from the city centre if access across the bridge is denied. It is madness, and the Park Hill developer, Urban Splash, understandably shares my strong opposition to barriers.
Local opposition has been exacerbated by the use of heavy-handed tactics to close the bridge on occasion. East Midland Trains has randomly shut the bridge to pedestrians, as it did one morning in May 2009, and it introduced human ticket barriers in February 2010. When, in September 2010, it was faced with angry residents who wanted to cross the bridge that it had closed without notice, it called in British Transport police, who handed out 45 cautions.
Underlining all that is the refusal of the Department for Transport and East Midlands Trains to acknowledge that Sheffield station is not just where you catch a train—it is a key part of the lives of the local people.
Angela Smith (Penistone and Stocksbridge) (Lab)
My hon. Friend is making a good case for keeping the bridge barrier free. Is it not the case that people from all over the city, who work at places such as Sheffield Hallam could recently expect to get off the tram at the stop called “Sheffield Hallam” to access their place of work?
Paul Blomfield
My hon. Friend makes an important point. In stressing the communities that I represent in Norfolk Park and Park Hill, I do not want to underestimate the impact of closing the bridge on the wider city. That is a crucial tram stop, which is widely used by people coming to work during the day, people studying at Hallam university, and those coming to the cinemas and theatres in the evening. That bridge is crucial for them.
Before the Minister makes the point, I recognise that there is a problem with revenue loss, although attempts to gain accurate information on the scale of the problem have met brick walls. The Minister quantified it in a letter to me, at £2.3 million, only today, but we need more analysis. Fare evasion must be tackled, but barriers are not the one-size-fits-all answer that the Department for Transport seems to believe.
The problem of revenue loss lies with local services—main line services have cracked it through effective ticket checks on trains—but it is not simply deliberate fare evasion. I regularly travel on local services and it is often a challenge to pay. For example, I can join the train at an unstaffed station where I cannot buy a ticket.
The train companies could make much better efforts to collect fares, and on the busy trains, at peak times, when it can be difficult for ticket collectors, they could deploy staff on the platform. They could also install ticket machines at unstaffed stations. They could do a number of things. Barriers are the easy solution for the Department for Transport and the train companies, which are guilty—if hon. Members will forgive the pun—of tunnel vision, because they are ignoring the wider interests of the city. The station and its bridge were rebuilt with public money, so why are the needs of the public not being put first? Our taxes paid for the station improvements, yet the Department for Transport wants to relegate the needs of the public behind those of the train companies.
That raises important questions on future franchising arrangements and what control communities have and should have over our stations. The current franchise expires in 2015, and it is vital that the new round of tendering, which will begin in the next couple of years, takes into account local views, so that the DFT and franchisees are not locked into an agreement that will damage our city.
This issue emerged under the previous Government, but let me reflect on how they dealt with it. The Transport Secretary at the time, Lord Adonis, listened to local people and challenged the policy of his officials, who appear to be the driving force behind the move to barriers. He listened, he came to Sheffield, he looked at the position, he attended a meeting of RASC and he responded to their concerns by announcing a clear and unequivocal commitment that there would be no barriers at Sheffield unless pedestrian access was maintained.
I want to know why the current Government will not honour that commitment and look forward to the Minister’s remarks.
Chris Williamson (Derby North) (Lab)
I have some experience of this problem in Derby. The station was gated, and although the authorities claim that pedestrian access has been maintained, it is complicated and difficult for pedestrians to gain access. Some need to obtain certification from the college on the other side of the railway line. That has caused local residents to object, so if my hon. Friend can prevent similar difficulties arising in Sheffield, I am four-square behind him, because I wish we did not have to contend with those problems in Derby.
Paul Blomfield
I am grateful to my hon. Friend for his intervention. I am aware of the situation in Derby. When EMT floated a similar proposal to tackle the problem in Sheffield, we drew heavily on the Derby experience in dismissing it as an impractical and unworkable solution.
That is one reason so many people are opposed to barriers. Indeed, when in opposition, the Minister wrote to a concerned rail expert on the matter. This is from his letter:
“Whilst barriers do work very well in some circumstances...it is by no means proven that revenue protection and passenger safety is achieved in others. For these reasons, I am opposed to the proposed new barriers at Sheffield and York railway stations.”
Will the Minister confirm that that is still his view and, if not, why has he changed his mind?
I look forward to the Minister’s response and his answers to these questions. Is he willing to travel to Sheffield and meet RASC to ensure that he properly considers the issues I have raised tonight?
Will the Minister provide a full breakdown of the revenue loss and explain exactly how it is calculated? What impact assessment has the Department conducted to evaluate the wider consequences for Sheffield, beyond the interests of the Department and the rail companies?
Why was there a reversal of the previous Labour Government’s commitment that there should be no barriers at Sheffield unless pedestrian access was maintained, and will the Minister tell the House who took that decision? Will he state whether it is the Department’s policy that every railway station should be gated? That seems to be the case from the incremental promotion of gating through franchise agreements, but if that is so, should that policy not be open to full debate?
Will the Minister say whether he now believes, as many in his Department do, that ticket barriers are the only solution to tackling fare evasion? Is it right that the DFT are making decisions from Whitehall about stations around the country without taking into account the local situation? Will he undertake to consult local communities before concluding the next franchise agreements for the management of local stations?
The words of my constituents tonight demonstrate that this is a disagreement not just between the Minister and me, but between the people of Sheffield and the micro-mismanagement of the DFT. The Department’s intransigence in pressing this deeply damaging proposal will have a huge impact on our city. I hope that tonight will take us one step closer to a resolution of this issue.
In conclusion, let me quote two of my constituents. Mark Doel says:
“This government says that it believes in devolving power to the local people. Well, the local people have spoken with one voice.”
Roger Donnison sums up Sheffield’s case perfectly:
“All of the recent investment in and around the station has been based on open access via the footbridge. Integration of the railway with the tram, and of Park Hill with the city centre will be lost without it.”
The Parliamentary Under-Secretary of State for Transport (Norman Baker)
I am pleased to respond to this debate and I congratulate the hon. Member for Sheffield Central (Paul Blomfield) on securing it and on putting forcefully the views of his constituents and others in Sheffield.
I fully recognise that there are local concerns regarding the access across the railway at Sheffield and I appreciate the points that the hon. Gentleman made about this long-running and sensitive issue. Let me assure him that I am fully aware of the issues and concerns that surround the proposed gating at Sheffield station. I have had representations not just from him but from other MPs in Sheffield, including the Deputy Prime Minister, who has made his views very plain on this matter as well. I want to be helpful and find a constructive way in which to resolve this matter, and I shall ask the hon. Gentleman for his help in that.
Let me deal with why we are where we are and answer some of the questions that have been raised. A key factor is the cost to the railway. There is another factor, which is access, but the loss of revenue is important. The hon. Gentleman refers to the letter that I sent to him. The costs of ticketless travel relating to Sheffield station is estimated at between 3% and 18%. The sum of £2.3 million a year was given to me by officials and was based on the minimum figure. If it were 18%, the amount would be £13.8 million a year. The hon. Gentleman will agree, as will all Members, that we simply cannot allow money to continue to haemorrhage from Sheffield in this way and that a solution needs to be found that captures the lost revenue as a matter of urgency. This is money that should be going to the railway to help improve services and, at the moment, it is being lost. It is also unfair that many people are paying for their tickets while others are able to travel apparently free of charge. That is not fair on the people who buy the tickets.
Normally with ticketless travel of this magnitude, train operating companies consider ticket-gating options. The magnitude of this issue at Sheffield was such, as the hon. Gentleman rightly and fairly said, that the previous Labour Government put an obligation on East Midlands Trains, when it won the franchise in 2009, to install gates at Sheffield. It should be clear, therefore, that this was an obligation on East Midlands Trains and was not something that it wanted to pursue itself.
Paul Blomfield
There was an obligation to install barriers or, if that proved unviable, to investigate other revenue protection measures. Will the Minister confirm that?
Norman Baker
Yes. My understanding was that the company was required to provide barriers, but I am looking to officials to see whether that is in fact the nuance of it. If there is any further information, I will give it to the hon. Gentleman before I finish my speech.
On ticket barriers—I want to talk about other aspects of the matter too, so the hon. Gentleman should not misinterpret what I say in the next few paragraphs—ticket gates are an efficient and proven method of significantly reducing ticketless travel and increasing rail revenue. That increased revenue has the effect of reducing the costs of the railways, as he will appreciate, for both taxpayers and rail passengers. As he will be aware, the cost of running the railways has increased by 60% in real terms since 1996-97. Sir Roy McNulty’s independent study estimates that UK rail costs are about 30% higher per passenger mile than those of our European competitors, so there is a big issue with general efficiency. Sir Roy McNulty’s study also goes on to state that the evidence suggests that
“the widespread introduction of gating at stations could reduce revenue lost through ticket evasion or the deliberate purchase of “wrong” tickets…The DfT data regarding rates of ticketless travel suggest it is about 12% in London compared with about 7% elsewhere.”
In addition, gated barriers at stations can bring a number of benefits to station users, rail passengers and the industry. Gates at stations are staffed when in use and therefore provide benefits to passengers in terms of safety and security through staff visibility. They also make it more difficult for non-ticket holders to access the railway, which potentially contributes to more enjoyable travel for fare-paying passengers.
The hon. Gentleman asked whether it was policy to require gating everywhere. I think it is a matter of horses for courses and each railway line and each station is different. It would not be sensible, for example, to install gating on very lightly used rural stations. That would be nonsensical in terms of the cost-benefit ratio. The Department and the train companies will estimate the likely consequence of not having a proper method to ensure ticketless travel is tackled—and I shall come to that in a moment—set against the cost of gating. He may be interested to know, for example, that I have recently required the installation of gating at Gatwick airport, a hole in the Southern network that has caused ticketless travel and been a magnet for those who wish to access the railway without paying.
Angela Smith
The point is, however, that as far as Sheffield is concerned, many of those found to be travelling without tickets boarded the trains at some of the rural stations to which the Minister has just referred. Clearly, as my hon. Friend the Member for Sheffield Central (Paul Blomfield) pointed out, the problem is that we have a scarcity of East Midlands Trains staff on the trains to ensure that people have paid for their tickets at stations further down the lines that serve Sheffield.
Norman Baker
Let me try to deal with the point about staff on trains. It is partly about franchise requirements—and, by the way, I am advised by officials that the barrier obligation is ongoing for East Midlands Trains, although alternatives would be considered if gating was not installed by a particular date, which I must say is an interesting franchise condition.
Members will appreciate that there is a significant cost to having staff on trains. Train companies employ revenue protection officers on a regular basis, but it is not possible—particularly on busy trains—to have any guarantee that the conductor, particularly when the train is busy and when there are frequent stops on the service, will be able to get through the train and check all the tickets. Indeed, the hon. Member for Sheffield Central said in his introduction that he is often unable to buy a ticket to travel on the train.
Chris Williamson
In view of his comments about the cost of train managers, will the Minister confirm that the plan to introduce more gates is part of a long-term Government plan to de-staff or run down the number of staff working on the railways? Is that behind his plans?
Norman Baker
I would not infer that at all. As I said a moment ago, if there are gates, staff are needed in case someone gets stuck in them. If the gates are unstaffed, they have to be left open. Gates are in fact a guarantee of staff on the station.
Angela Smith
The Minister mentions a problem with staff getting around to check all tickets on busy trains, but that underlines the fact that on the Penistone line, in particular, which runs into Sheffield station—it is a busy commuter route from Huddersfield and serves my constituents—we have a lack of capacity. So perhaps one answer is to have not just more staff on trains, but more trains.
Norman Baker
I entirely sympathise, but the hon. Lady makes a wider point, and I hope she notices that, notwithstanding our difficult economic situation and inheritance, we now have the biggest investment in railways since Victorian times, a commitment to improve rolling stock on several lines, an electrification programme that has extended way beyond what was originally anticipated and a tram-train pilot in Sheffield. There is a great deal of investment in transport, and any fair-minded person would look at the Government’s investment portfolio and conclude that, since May 2010, transport and, in particular, railways have done rather well.
The Chancellor’s growth statement included several roads that the hon. Lady may notice, but what was not picked up was that £1.4 billion extra is being allocated for rail, as against £1 billion for roads. So we are seeing massive investment in the railways, and that includes—[Interruption]—I wish she would not chunter in the background; I am trying to answer her questions—investment in rolling stock. There is a commitment to new rolling stock for the east coast main line and for the First Great Western line; new rolling stock is being introduced to the Thameslink programme; and we are continuing with our intention to bring in 2,700 new carriages.
I fully accept that we have a problem on the railways, in that more people than at any time since 1929 now travel by rail—if that is a problem—on a network that is between a half and two-thirds of the size it was in 1929. I call it a success in some ways, but it is called a problem in terms of its consequences. The public’s perception of their journey is also much more favourable than was the case even 10 or 15 years ago, and people now regard trains as safe, more punctual and more pleasant to use. That is a problem of success, so the inevitable consequence is that we have to follow people’s increased use of trains, which has largely been recession-resistant, and ensure that there are sufficient orders to pick up extra passengers.
One answer is to invest in high-speed rail, and, if the Secretary of State concludes when she makes her statement in due course that she wishes to pursue the Y-shape proposal, her decision will significantly benefit the Sheffield area, as well as everywhere else in the country. So I assure the hon. Member for Penistone and Stocksbridge (Angela Smith) that we are doing our best to ensure that there is real investment in carriages and infrastructure. That is quite a long answer to her point, but I hope it assures her that we take rail extremely seriously. Indeed, I would not be doing my job of lobbying within the Government if that were not the case, but I am happy to say that it is.
Let me return to the subject in hand. The welcome increase in the number of passengers using rail services in south Yorkshire—this point follows on from the one I have just made—has also brought problems that the Department is managing in conjunction with local stakeholders. For example, additional rail vehicles have been introduced to provide more capacity. Unmanned local stations are cheap to operate and improve access to rail services, but that does not make it any easier for on-train staff to collect and issue more tickets on board busy trains. Sheffield, as I have mentioned, has a particularly high level of ticketless travel.
Paul Blomfield
In my experience and, certainly, that of others, the problem is not just with busy trains, because companies could make more effort to collect revenue from trains on which it is perfectly easy for collectors to navigate the carriages. On busy trains, which are limited to certain peak times, it would also be possible to deploy ticket collectors on platforms at the station. Has there been a proper economic assessment of that idea, as a revenue-side way of dealing with the problem, in comparison with the capital side? My hon. Friend the Member for Derby North (Chris Williamson) made the point that it could be a win-win for us, because it would not only tackle fare evasion, but create more jobs.
Norman Baker
I am not going to stand here this evening and say that everything possible has been done by East Midlands Trains, or Midland Mainline before it—or, for that matter, any other train company—to minimise the amount of ticketless travel on its trains. Some companies do better than others. It may well be the case—I just do not know—that there is more scope for staff on trains to—
Norman Baker
With respect, I should not know what happens on every single train across the country, because we are now moving into an era in which we avoid micro-management of the trains. We are setting the high-level objectives; we are not seeking to micro-manage every train, let alone every passenger on the network. However, as a general principle, it is right that train companies should try to minimise ticketless travel by whatever means they can; indeed, it is in their interests to do so. As to whether a cost-benefit analysis has been carried out to see whether such measures are more effective, to be honest, I am not sure that one has been, although I will check that and write to the hon. Gentleman.
What I would say, however, is that the problem is a bit like when the police stop drivers speeding: when the police are there, they are effective, both at the time and for about a week afterwards, but then the average speed of the motor vehicles on those roads rises again. A gating solution is a permanent solution; a solution involving people, unless they are permanently there, is not a permanent solution and is less effective than gating. However, I will write to the hon. Gentleman about the point that he has raised.
Lilian Greenwood (Nottingham South) (Lab)
But the Minister has said that gates have to be staffed. In fact, my experience of East Midlands Trains—not in Sheffield, but in Nottingham—is that gates are regularly unstaffed, so they are doing nothing to prevent fare evasion.
Norman Baker
If a train company operates gates without regularly staffing them, that will lead to a loss of income, and it is responsible for dealing with that. However, travelling the network extensively as I do, I do not often come across gates that have been left open.
East Midlands Trains, along with Midland Mainline before it, has undertaken manual staffed barriers of ticket inspectors on selective days to ensure that all passengers passing through Sheffield station are in possession of a valid ticket—perhaps those were the instances to which the hon. Member for Sheffield Central referred in his introductory remarks. The increased revenue collected at the station on those days, both by the inspectors and through increased sales at the ticket office, indicates that between 3% and 18% of travel at Sheffield is ticketless—that is where the figure comes from. That means that at least £2.3 million is lost to the railway each year through ticketless travel in the area. I want to deal with that, but I also want to deal with the point that the hon. Gentleman raised—quite understandably—about the views of people in Sheffield and those who perhaps do not want to travel by train, but do want to use the bridge.
I hope that the hon. Gentleman is aware that the station bridge in Sheffield to which he referred is not a right of way. It may be an established route in a non-legal sense, but it is not an official right of way. In fact, he will know that the bridge is locked shut every night after the last train, presumably to prevent it from becoming a right of way. However, I know that for many people—including students, residents and visitors—it has become the most convenient thoroughfare for crossing the railway. I also accept the point about access to the tram stop. As I am keen to promote light rail and low-carbon forms of transport, that is a point that I take seriously. However, although the bridge is not a right of way, I understand that Sheffield council has promoted it as part of the “gold route” access strategy for its redevelopment of the Park Hill area on the east side of the city.
I agree with the hon. Gentleman that it is important to try to ensure that, through the installation of gates—if that is what occurs—the railway does not cut a community in two, and that the community is provided with a satisfactory and easy way of gaining access across the railway. We therefore looked at a number of options, including: the refurbishment of the existing public bridge to the south of the station; the refurbishment and extension of the station goods bridge; dividing the current station bridge to provide separate lanes for railway passengers and public access across the station, which is a solution that I was particularly keen on; building a new bridge at the north end of the station platforms; and building a new bridge crossing over the railway tunnels at the north end of the station. As the hon. Gentleman will be aware, in 2009 the Department for Transport commissioned Network Rail to undertake a feasibility study to look into those options. The report has previously been released to Sheffield city council and the South Yorkshire passenger transport executive. As he requested on 17 November, I have also sent him a copy of the report.
The report recommended that the options of extending the station goods bridge and of trying to split the existing station bridge be discarded, as they were both impracticable and excessively complicated. The report recommended further investigation of the remaining options. We have explored those options at some length, and both my right hon. Friend the Member for Runnymede and Weybridge (Mr Hammond), the then Transport Secretary, and I have visited Sheffield station separately to look at them for ourselves.
In answer to the point about Lord Adonis, I must say that he was a very competent Transport Secretary—and I never hesitate to say that.
Norman Baker
The hon. Gentleman says that Lord Adonis listened; well, we have listened. He went to Sheffield and I have gone to Sheffield. As far as the commitment to no barriers is concerned, there are no barriers there yet, and we are 19 months or thereabouts into this Government. We could have dealt with the matter on day one, but we did not because of the sensitivity of the issue and because we wanted to reach a satisfactory conclusion. I hope that the hon. Gentleman gets some reassurance from that.
Based on the Department’s discussions with Sheffield council over the last two years, a possible alternative to the station bridge has been identified in the form of the building of a new public bridge over the north end of the station platforms. I understand that, as part of its long-term city regeneration plans, Sheffield city council already envisages replacing the existing bridge to the south of the station and building a new bridge over the railway tunnels to the north of the station. The construction of a bridge to the north might address the requirements of both the railway and local stakeholders.
In addition, we are looking at a number of ways in which continued access across the railway for local users could be maintained by using the existing station bridge, while also capturing lost revenue. I stress that we have not yet reached a conclusion: we are looking at these matters in the round in order to find the best options for a solution. For example, East Midlands Trains has offered to provide “timed passes” to local residents and others, which would allow them to pass through any gates and continue to use the station bridge to cross the railway. Officials have been investigating the feasibility of gating at platform level and I have to say that there are serious objections to that as well, particularly in terms of practicality, as some accesses are very narrow and would not be wide enough for the gates, causing congestion. Staff would be required on every single platform, which is hugely expensive—probably more than the ticketless travel costs. Although this may appear to be an attractive option, I am afraid that it does not work. All these potential solutions are in addition to the existing alternative routes that bridge the railway in the proximity of Sheffield station. We have to deal, however, with the problem of ticketless travel.
I said that I wanted to be constructive—and I do—because this is a serious issue for people in Sheffield and a serious issue for the railway. I am keen to resolve the issue constructively and in a way that I hope addresses the interests of all involved. I want to make the hon. Member for Sheffield Central and other hon. Members an offer tonight. [Interruption.] I am not going to ask anyone to put their hands into their pockets; there is no need to worry. The Secretary of State and I are happy to have a round table meeting with all Sheffield MPs, representatives from the council and perhaps a representative from the campaign group. They can come down here—and I will look at the diary and see whether we can go up there—to look at the options openly and frankly in order to make progress. We have nothing to hide; we are happy to share the information to try to reach a satisfactory conclusion. The Secretary of State is keen to achieve that as well. We will both be involved.
The two objectives that we provisionally set are as follows. The first is that we must end, or significantly deal with, ticketless travel on the railway. The second is that we seek to meet the legitimate aspirations of people in Sheffield to be able to cross the railway without restriction. We want to achieve both those objectives. Provided people are signed up to achieving them, we should be able to make some progress. I hope that hon. Members will find that response helpful.
Paul Blomfield
I welcome the Minister’s offer, with those caveats. We share the desire to tackle ticketless travel and I welcome the Minister’s aspirations to address the concerns expressed by local residents and local organisations. The sort of meeting he describes, involving the local campaign group as he mentioned, would be a positive step forward. I thank him for that.
Norman Baker
I am grateful for the hon. Gentleman’s response. We will try to make progress. As the last Government recognised and as we now recognise, this is not an easy issue, but we are determined to make progress, and I believe that with good will on all sides we can do so. I will write to him and his colleagues in Sheffield shortly.
Question put and agreed to.
Westminster Hall
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Zoos (Regional Economic Development)
Westminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.
Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
This information is provided by Parallel Parliament and does not comprise part of the offical record
Andrew Rosindell (Romford) (Con)
Good morning, Mr Bone. As chairman of the all-party parliamentary group on zoos and aquariums, I am delighted to have the opportunity to discuss the economic growth potential of the magnificent zoological institutions and live wildlife sites in all regions throughout the United Kingdom and Ireland. That potential extends to aquariums and wildlife and safari parks, and is evolving rapidly, opening up to all forms of imaginative partnership, a fact that is not always self-evident to Government.
I therefore thank the Minister of State, Department for Business, Innovation and Skills, my hon. Friend the Member for Hertford and Stortford (Mr Prisk), for attending this important debate on the future beneficial role of the widespread community of zoological organisations and the important part that they play in society, especially for our economy and future growth. I will make one specific request to the Department for Business, Innovation and Skills at the culmination of my speech. My fundamental contention is that, especially given the current focus on economic growth and rebalancing our economy, UK zoos, in their relations with Government, have been categorised for too long exclusively within the brackets of tourism, leisure and the environment. I argue that such sites should extend beyond those brackets and into a more holistic economic development arena.
A recent outline economic impact study on the sector carried out for the British and Irish Association of Zoos and Aquariums—the national association that looks after the interests of zoos throughout the British Isles—using the most conservative formula available, showed an annual contribution of £645 million to our tax base and the stimulation of 11,000 lasting jobs. I will deal with the study in more detail shortly, but I strongly suggest that with proper encouragement, aquariums, zoos and similar wildlife sites can become even more dynamic engines to help our economy in many ways. They can boost local employment, drive long-term tourism growth, enhance a positive image of regional culture and leisure that encourages inward investment, champion environmental technology, assist in the internationalisation of our economy and the mindset of our population and promote and protect native wildlife and our overall UK tourism landscape, as well as providing the more exotic biodiversity with which zoos are traditionally associated. They can also act as community hubs and focuses, supporting volunteering, community activities, hobbies and special interest groups of all kinds.
A glance at any region’s blueprint for economic growth and environmental responsibility will reveal few desired outputs that cannot be delivered by the sufficiently imaginative development of a zoo. I am especially taken by the unexploited potential of our great zoological institutions to act as shop windows championing cutting-edge research carried out by the UK’s leading research universities. I am aware that moves are being made to partner zoos and aquarium sites with specific cutting-edge research programmes at neighbouring universities, and I am struck by the fact that the science and technology areas involved go far beyond the easily anticipated disciplines of zoology and biology.
The National Zoological Society of Wales, for instance, is developing ideas in partnership with the universities of Glyndwr and Bangor. The National Marine Aquarium is linked closely to Plymouth university in terms of marine science and regional economic growth acceleration. Edinburgh zoo, which has been in the news recently due to the arrival of the pandas, already has a successful alliance with Scottish universities, particularly St Andrews in respect of primatology. Twycross zoo in Leicestershire is exploring potential with Nottingham in a variety of areas, including veterinary science and animal health.
I foresee a compelling future in which zoos and similar wildlife sites are assisted in taking the excellence of our universities’ research and training and placing it firmly in the public arena, in the path both of those who initially pay for it and those who ultimately benefit from the shared affluence produced. The zoo sector’s traditional departmental relationship has been with the Department for Environment, Food and Rural Affairs, and has involved regulation on health and safety and animal welfare, as well as the zoo community’s role in conservation. That is a highly valued dialogue, and I am not suggesting that it be downgraded in any way. Equally, the work of the zoo community maps on to that of the Department for Culture, Media and Sport, in terms of tourism and cultural and heritage identities.
Tony Cunningham (Workington) (Lab)
Last summer, having spent all year based in London for most of the week, I decided to have a family holiday in London, in order to bring my family to London zoo. Does that not demonstrate the economic importance of organisations such as zoos?
Andrew Rosindell
I thank the hon. Gentleman for that intervention, which emphasises the point that I am making. Zoos are the heart of everything in our country. People love to go to zoos and see the animals. However, it is not just about tourism. These days, it is about a wide range of things. It is important to ensure that the public understand that zoos are about more than just animals; they are about conservation and tourism. This debate focuses particularly on how zoos help to strengthen our economy in certain regions of the country.
To return to the point that I was making, zoos involve more than one Department: the Department for Culture, Media and Sport, in terms of tourism and cultural and heritage identities; the Department for Education, in respect of education and the family dynamic; the Department for Communities and Local Government, in respect of zoos’ powerful role in promoting community values and as a hub for volunteering; the Department of Energy and Climate Change, in terms of their championship of environmentally sustainable buildings and the ultimate aim of a zero-carbon society; and the Department for International Development, as massively attended public sites connecting the UK electorate and taxpayers with the realities of populations in developing countries who live alongside and interact with the animal kingdom.
In championing this debate, it is my firm and overriding ambition that a practical dialogue should ensue between officials in the Department for Business, Innovation and Skills and the British and Irish Association of Zoos and Aquariums, or BIAZA, the zoo sector’s official representative body. The public goods presented by safari parks, zoos, aquariums and all wildlife institutions are almost too numerous, but in these difficult times, surely a wealth-creating agenda in the context of environmental responsibility should be our priority.
Nia Griffith (Llanelli) (Lab)
Does the hon. Gentleman know what is being done to market our zoos and wildlife parks? I speak particularly of those that are not so high-profile, such as Penclacwydd in my constituency, where the emphasis is on pond dipping. It has the most fantastic array of pond life and a wild bird collection. Such attractions do not, perhaps, have the same appeal as a large safari park. Does he feel that enough is being done to promote and market the whole range of wildlife parks?
Andrew Rosindell
I agree that not enough is being done. That is why I called this debate: to talk not about the welfare of animals, which is normally the topic of debate when zoos are mentioned, but about the promotion of zoos as part of our economic regeneration. I have never had the privilege of visiting the zoo in the hon. Lady’s constituency. Maybe I will visit it at a future date. I look forward to doing so.
In addition to strategic partnership with research universities, there is much further evidence that zoos and zoo projects are net generators of prosperity, with the potential to do a lot more. First, let me point briefly outside the zoo world to Cornwall’s Eden project. Based on the appeal of the living world and predicated on an environmental ethos, the site attracts large numbers of paying visitors. As a model, it is very close to our great zoological sites. Surely, no one could doubt that the Eden project has made a huge contribution to Cornwall’s overall economy and society in an organic place-making sense that embraces and extends far beyond tourism and leisure. Indeed, it is striking that of the millennium capital projects, the Eden project and BIAZA member, The Deep—a submarium—have been some of the greatest successes, demonstrating their self-sustainability and viability. Clearly, large numbers of the UK public are prepared to pay to visit sites where they can imaginatively re-engage with nature and the living world. In doing so, they also guarantee their very financial continuity in a virtuous economic circle.
Secondly, BIAZA’s initial economic impact analysis, which scopes the overall sector, reveals a current economic contribution to the UK of £645 million a year. That was calculated at the most modest level possible and is thrown into relief by the figure of $8.4 billion arrived at by the American Association of Zoos and Aquariums. The study’s results also unveil the far greater potential for such sites if they are given sufficient encouragement and focus. It also underlines that the 11,000 jobs generated, both directly and indirectly, are permanent or at least long lasting—not vulnerable to international outsourcing, as so many other sectors are today. Jobs in tourism are, after all, by definition rooted to a specific place.
Thirdly, I refer to the confidence of, and major investment from, the recent regional development agencies and the devolved Administrations in specific zoo sites and projects lying in their respective regions. One might mention zoos in Edinburgh, Bristol, Chester, Wales, Twycross and Paignton, the leading aquariums in Hull and Plymouth, and other sites in this context. It shows that in all such quarters, authorities have already accepted the economic development logic of zoo and aquarium sites.
Fourthly, such organisations support, improve and communicate a certain fundamental quality of life, a clear and positive sense of place and a celebration of locality. Their development helps to retain and attract knowledgeable, skilled graduates and high-earning professionals. Employers and inward investment will follow the people. Many leading zoos and wildlife sites are non-profit charities, and almost all are to some degree mission, rather than profit led, adopting a social enterprise ethos and reinvesting all or much of their annual surplus in wildlife conservation, education, science, the community and other public goods. Thus the prosperity generated by zoo activity largely tends to remain of local benefit, rather than be shipped off by multinational interests.
In addition to the traditional identity of such sites, they can also act as cultural organisations. The National Marine Aquarium in Plymouth is a key partner in cultural and social events such as the “blue mile” and a recently initiated international marine festival. The cultural role of wildlife venues also expresses itself in architecture and local community heritage based in native species and the much-loved landscapes of Britain. Capitalising on large numbers of visitors concentrated at a single venue, such sites can function as tourism hubs and dynamic promoters of the overall landscape, wildlife and heritage of the UK that extends to both domestic and foreign visitors. They are socially embracing institutions that in all sorts of ways provide a positive impact on a large audience.
Finally, such sites are financially stable organisations. They are not holding out a begging bowl for revenue, but offering attractive platforms for partnership and investment. Indeed, the zoo industry has seen strong, long-term growth for more than 20 years. The fundamental zoo proposition has withstood the challenge of changing fashion and competitive technology for 150 years. It is embedded in our British way of life; it is part of our British tradition and it is here to stay. Nobody claims that this relatively small sector of UK enterprise can perform at the massive economic level of, let us say, aerospace, biotech, manufacturing or other industrial powerhouses of the economy. Such an assertion is not plausible.
Mr Gregory Campbell (East Londonderry) (DUP)
I congratulate the hon. Gentleman on securing the debate. Before he elaborates on the niche that zoos and aquariums fit into, does he agree that the sector offers our children and young people—primary or post-primary—an opportunity to expand their horizons that the other sectors he outlined cannot offer in terms of scale and access throughout the year?
Andrew Rosindell
I agree entirely. Zoos provide a wonderful opportunity for young people to learn about wildlife and the animal kingdom, conservation and the environment. They are accessible and good value, given what a family gets from the cost of visiting a zoo or a site.
Tony Cunningham
We have spent a lot of time on zoos, but does the hon. Gentleman agree that people have exactly the same experience in aquariums? An aquarium in Maryport in my constituency specialises in fish from the Solway firth and is a huge educational attraction.
Andrew Rosindell
The hon. Gentleman makes a valid point. I have mentioned aquariums; BIAZA, of course, covers both zoos and aquariums. It promotes all wildlife sites, whether safari parks, zoos or aquariums, or any other institution that promotes the conservation of animals and education about the animal kingdom.
Niche activity can, in its own framework and at its own level, be encouraged to raise radically its economic and fiscal contribution to the UK. Surely, there is a subtler point: the zoo site may not be the largest employer or the chief economic driver within a given constituency or region, but it is often one of the most visible and certainly the best loved. The celebration and the development of a city’s aquarium, such as in Plymouth or Hull, or of a safari park—Knowsley for Merseyside, Woburn for Bedfordshire or Blair Drummond for Stirling and central Scotland—is subtly, but profoundly, linked to a generally enhanced sense of confidence, enterprise and aspiration, national and international attention, and resurgence for the surrounding socio-economic fabric as a whole. To quote a particular example, only two years ago, the citizens of Hampshire voted Marwell Wildlife
“that thing of which we are most proud”.
It was the foremost aspect of living in Hampshire that residents chose to celebrate.
In closing, I look to colleagues on both sides of the House to offer their perspectives and perhaps to refer to individual zoos or wildlife institutions in their constituencies. I request that the Minister and his officials now enter into dialogue with representatives of BIAZA to work towards a mutually agreed policy statement on the wealth-creating identity and unused potential of zoos across the UK and to discuss how Government can encourage and nurture their further potential for the greater good of our economy.
Mr Peter Bone (in the Chair)
Order. It might be useful for Members to know that I intend to start the wind-up speeches at 10.40 am. There is a great deal of interest in Mr Rosindell’s debate, so could Members keep their comments reasonably short? I call David Tredinnick.
David Tredinnick (Bosworth) (Con)
I am most grateful to you, Mr Bone, for allowing me to speak first after my hon. Friend the Member for Romford (Andrew Rosindell). The debate is well supported this morning, perhaps because of his efforts. He has already mentioned twice the famous Twycross zoo in my constituency. I would like to discuss the twin aspects of developing economic activity in respect of zoos: what they are doing at home and, in the case of Twycross, what they are doing abroad.
In my area, we feel strongly about my zoo. I claim Twycross as a zoo of my own because I have represented the area for many years and know the zoo’s founders and staff, whom I have tried to support for a long time. Twycross receives 400,000 visitors a year and has nearly 1,000 animals—500 mammals, 220 birds and 135 reptiles. It has the widest range of animals in captivity in the area, but they are not in cages. We also have the best laid out area, which consists of 40 acres where elephants, giraffes, lions and leopards can roam around outside.
If we are to develop economic activity in the zoo industry, we must ensure that there are open spaces and that zoos meet the modern requirements that people expect. They do not want to see all animals in cages. I congratulate Molly Badham, Nathalie Evans and Suzanne Boardman and her team on managing to take things forward, so that we have a new paradigm in zoos. We are talking about economic activity at home and what is happening abroad. If someone wants to have a successful business as a zoo, they need to be very forward thinking. I submit that that is exactly what Twycross has done. I shall cite three or four projects in which it has engaged that have increased visitor numbers and set a very fine example.
The first is the Borneo longhouse project, which is part of four projects where the public are immersed in animal activity. Rather than just looking through the window, the public are part of the experience. That first experience was opened by Liz Hurley in 2005. I was very lucky to be there and she did a fantastic job of drawing publicity to the zoo. The longhouse has not only simulated rain and steam, but simulated thunder and lightening. It is a very exciting place to be, and of course zoos must be exciting if we are to attract younger people and prevent zoos withering on the vine, like our public houses; that is a very sad thing. We must have exciting venues for people to visit. I can assure hon. Members that coming back through the bat cave is exciting because one can see the bats, although some people might not like bats that much.
The second very exciting development at Twycross that I would like to mention is the amazing snow leopard outdoor park, which is a massive outside cage that is about two cricket pitches long. Visitors in the extensive visitors’ centre, where people can buy a range of animal souvenirs, can see snow leopards out on the rocks. That has been a fantastic draw for people and the experience has been combined with what I was going to call corporate entertainment, but it is done in a slightly different way. People can book the venue to have lunch, dinner and receptions while watching the snow leopards and the birds in the wetland wader bird enclosure that is next door. That 40 acres is a dynamic, exciting, forward-looking area, where animals can roam and people can enjoy them and go around on a little train if they want to.
The project has brought great success to Twycross. In fairness, I should mention that it has received top British and Irish Association of Zoos and Aquariums awards this year for best educational project, significant advances in husbandry and welfare, best new zoo enclosure and best research project for entamoeba histolytica—I will send my notes to Hansard. That award was for maintaining animal welfare and dealing with that tricky bug.
There is greater economic activity at home at Twycross, but what is it doing abroad? Twycross takes the lead in conservation abroad. It does conservation in situ at home in terms of trying to protect endangered species, and it currently has 67 species of animal in the European endangered species programmes or European studbooks. That is significant because, in the past, zoos have been under attack by people who do not like animals in cages. As I have said, Twycross is a very open area. There is open access and it is forward looking. Also, if we do not have organisations such as Twycross zoo, we will not have some of those species.
We are all worried about endangered species, and I absolutely applaud what Twycross has done to protect specific endangered species abroad such as the gibbon that lives on the Vietnamese-Chinese border that was discovered by Fauna and Flora International scientists some years ago. Only 150 such gibbons remain in the wild, but Twycross has an outreach programme to support them. It has a gibbon conservation centre and a community-based range of patrols. That is an example of what Tywcross has done abroad.
Twycross is doing something else abroad. In areas where it is helping animals, it is encouraging and assisting local people to develop skills that will prevent deforestation, for example, by explaining the benefits of fuel-efficient stoves to reduce the amount of fuel wood collected from the forest. It is also helping local people to grow feed plantations to reduce the free grazing of livestock, which denudes the landscape and threatens the lives of the animals. In addition to the ecological research to which I have referred, it is also planting new tress to help supply sustainable firewood for the future.
I shall not speak for any longer because I do not want to be selfish and take up time. As I said, I am grateful to you, Mr Bone, for allowing me to speak first after my hon. Friend the Member for Romford. I will sum up by saying this. Some two-thirds of a billion pounds is annually put into our tax base by zoos across the UK and, at the last count, there were 11,000 lasting jobs in the sector, including those created by the 400,000 visitors at Twycross in Leicestershire. Some 28 million people a year—one third of our entire population—had some connection with zoos last year. Surely, that is enough for my hon. Friend the Minister to take this issue very seriously indeed.
Jim Shannon (Strangford) (DUP)
I congratulate the hon. Member for Romford (Andrew Rosindell) on bringing the matter to the House. I spoke to him yesterday about it and I am keen to contribute in support. The key issue is the regional economic development aspect that is included in the title of the debate. The zoo sector has created jobs. I should like to focus on two locations in my constituency, because they have experienced economic growth as a result of aquariums and wildfowl centres. The wording of the debate title is clearly the key to the matter, because economic development comes off the back of the jobs that are created. We have an opportunity to get ourselves out of these difficult times. I feel that the sector could be used to the betterment of my constituency.
Others may disagree, but I represent what I consider to be the most beautiful constituency in the United Kingdom, Strangford. I say that for a number of reasons—not only because I live there, but because every morning I wake up and look out over Strangford lough, which is recognised as an area of outstanding natural beauty and as a Ramsar site as well. People all over the world are aware of the area and, for that reason, I am pleased to be here to talk about it.
Ards borough council—wearing a hat that I had for some 26 years; I resigned from it only a year and a half ago—was part of the area’s economic development. The council and its development officer—along with the Northern Ireland Assembly and Down district council, which also has a part of Strangford lough is within its area—recognised the good news that there was an opportunity for economic development, which would create jobs and financial stability.
The hon. Member for Workington (Tony Cunningham) is not in his place, but Exploris in Portaferry is part of the group that he spoke about earlier. It is an aquarium in the south of my constituency that attracts approximately 200,000 visitors a year. My hon. Friend the Member for East Londonderry (Mr Campbell) mentioned educational advantages and the hon. Member for Romford responded to his question. Exploris focuses on education and is an attraction for schools, which keep coming back, and the format changes every couple of years to keep it new and fresh. The seals in Strangford lough have been the key to promoting the aquarium—they are the stars of Exploris. About three years ago there was an outbreak of seal flu. There was a concern that a lot of the seals would die, but the seal population is back and attracts many people to the area. Exploris can grow: private enterprise is keen to be involved and Government money will be spent. Arlene Foster, the Minister with responsibility for tourism policy in the Northern Ireland Assembly, is working with councils to bring further economic development and growth.
Our second jewel in the crown is Castle Espie. At least one hon. Member in the Chamber is aware of Castle Espie. The gentleman who was originally responsible for the Wildfowl and Wetlands Trust harvested, from a shooting point of view, wildfowl in Strangford lough and further afield—something that I have done, too. Although Castle Espie provides an opportunity to shoot geese and ducks, its wildlife centre also has a clear responsibility as a conservation area. People can visit the area and enjoy seeing ducks, geese and waders. Strangford lough is one of the areas in Europe and the United Kingdom that is visited by Brent geese. They come in large numbers, which continue to grow. Perhaps the Government will have to consider whether Brent geese stay on the protected list or become a quarry species, but that is for the future. More than 100,000 people visit Castle Espie every year. There has been substantial expenditure to attract new visitors, and to make the convention centre more attractive to people from outside the local area. For a nice exciting day, it is clearly a place to visit.
There is an economic benefit from tourism, and there is more to come. It is a growth industry on which we need to focus, and that is why I am pleased to speak in the debate. The two local councils have created 400 jobs off the back of tourism in our area. I believe that tourism can and will provide more. Castle Espie has been upgraded, and Exploris has seen substantial financial commitment. It is wonderful to have those two attractions, along with the Mount Stewart estate in the centre of the Ards peninsula. Mount Stewart is not a zoo, an aquarium or a wildlife centre, but another attraction. I encourage hon. Members, if they have not booked their holiday for next year, to do so now: Strangford lough and the Strangford constituency would be the place to come to, with Mount Stewart in the centre, Exploris down at the southern toe, Castle Espie on the other side and much, much more. They will not be disappointed. Jobs have come off the back of tourism, with potential for economic growth. We can do more.
Mr Nigel Dodds (Belfast North) (DUP)
As my hon. Friend is issuing invitations to visit Northern Ireland, may I urge people, and urge him to urge his constituents, to come up the road to Belfast? Not only are we investing £100 million in the new Titanic signature project for 2012—a massive investment in one of the world’s greatest tourist attractions—but Belfast zoo is one of the UK’s leading zoos. It will, for many years, continue to attract tens of thousands of visitors from across Northern Ireland. He is right to focus on the massive tourist boost of having a zoo in the region that we represent.
Jim Shannon
I thank my right hon. Friend for his intervention and fully support what he is talking about. In Northern Ireland, we are very fortunate to live in much more pleasant times. We have a democratic process that is moving forward, and we have partnership government. It may not be ideal in every sense, but it is certainly the way forward. We have an opportunity for growth, part of which is tourism, as he says.
I am very pleased to be here today to speak in this debate. I encourage hon. Members to consider their holiday destination for next year. I am sure that my right hon. Friend, my hon. Friend the Member for East Londonderry and I will be able to supply tea and biscuits. We are pleased to speak to this matter, and we thank the hon. Member for Romford for securing the debate.
Mike Crockart (Edinburgh West) (LD)
I welcome this debate and the opportunity to discuss the role that zoos play in our regional economies. I thank my hon. Friend the Member for Romford (Andrew Rosindell) for his work in securing the debate. In my maiden speech last year, I laid claim to represent more penguins than any other hon. Member. I am proud to able to add to that list, and I must, obviously, mention Scotland’s new arrivals. While I am not the only hon. Member here today to represent exotic species, I am very proud to be the only hon. Member with two giant pandas as constituents: Tian Tian and Yang Guang, or Sweetie and Sunshine. They arrived last week and I understand that they are settling well into their new home. I hope to be able to visit them in the coming weeks. I am pleased that Scottish Enterprise has wasted no time in commissioning a report to help to understand the pandas’ potential impact on tourism, and the economic impact at local and national level. I await its findings with great interest.
Today’s zoos are much more than entertainment; they are centres of conservation, education and research. Yes, zoos continue to draw huge numbers of tourists, and so add directly to a region’s economy through tourist revenues, supply-chain jobs and roles in the service industries. However, their ability to deliver wider and more dramatic results has been somewhat curtailed by a failure to recognise them as businesses, centres of innovation and hubs linking cutting-edge scientific research, education, technology and commercialism. I hope that today’s debate marks a step change in that respect. With our focus on growth and rebalancing the economy, it is essential to capitalise on all areas to drive future development and sustainability.
Edinburgh zoo, in my constituency, is home to more than 1,000 rare and endangered animals. It is also one of Europe’s leading research centres for conservation and education, working collectively with many other zoos and conservation agencies in co-ordinated programmes. The Royal Zoological Society of Scotland has also worked for recognition by the university of Edinburgh as an accredited research associate, and has signed a memorandum of understanding with seven major Scottish universities to ensure co-operation in research. As my hon. Friend the Member for Romford said, the UK’s zoological institutions are uniquely positioned to act as shop windows, championing the cutting-edge research being undertaken in our universities. He mentioned excellent examples in Wales, Plymouth and Edinburgh.
In Edinburgh, pairing with St Andrews is producing excellent output in primatology. The work is not just in biology, but is pushing boundaries and discoveries in chemistry, physics, engineering, maths, design and aesthetics. Interestingly, the Budongo trail, an excellent facility hosting the chimps, also has corporate rooms available for conferences, overlooking the chimp enclosure. It is perhaps arguable who is more bemused by what they see: the chimps or the conference participants. Such research work should not be shut away in our universities and research laboratories, but shared and celebrated with the public and visitors from overseas. It seems clear that, in that way, our zoos and similar institutions can and should act as a hub, translating primary research and scientific excellence into something of commercial and educational value. In Edinburgh, that education extends not only to school visits but to the excellent summer school run for 15 and 16-year-olds from throughout Scotland. Another example of local engagement is seen in this year’s 175th birthday celebrations for Bristol zoo, where sculptures of gorillas by local artists were placed on a mass public art trail for 10 weeks this summer.
As my hon. Friend said, zoos and aquariums contribute £645 million each year to the economy. A recent American report suggests that zoos have been doing better since 2008, as people increasingly look for affordable entertainment. With appropriate support and encouragement, however, such sites can become even more dynamic engines for regional growth and development, boosting local jobs, driving long-term tourism growth, championing environmental technology and enhancing regional leisure opportunities, thereby encouraging inward investment. The sector itself recognises that it has more to offer, if only its unique position were recognised by others, Government in particular. To quote Dr Miranda Stevenson, director of the British and Irish Association of Zoos and Aquariums:
“Zoos and aquariums have a great deal of potential which is not being exploited by the government. They are not only a significant tourist attraction, but are of great conservational, educational and economic value in terms of local economic development and wealth generation.”
She added that a recently produced BIAZA report was
“the first step towards establishing the value of zoos to the wider economic and social good.”
The mention of social good is interesting and I want to touch on that briefly.
In no other sector are visitors so equally spread across ethnic group, age, socio-economic background and level of education. The tradition of a family day out at the zoo blithely transcends social and economic barriers, and includes nearly every child at a formative point in their education. The BIAZA report showed that in 2010, 25 million people, more than a third of the UK population, visited one of its zoos or aquariums over the year; more than 1.2 million of them on an educational visit. That is not unique to the UK. A report on Australian zoos found that more Australians visited zoos each year than any other form of cultural entertainment, apart from watching films. Yet the chance to use zoos, safari parks and the like as a place to deliver key messages on education and opportunity is often overlooked. The UK is not alone in that respect. The same Australian report concludes that
“the contributions that governments make to the zoos sector is very low compared to the way in which society values zoos.”
I hope that today’s debate will mark the beginning of a new era for the UK’s zoos, recognising them as institutions that can help us to grow economies and address skills gaps. As such, I hope that the Department for Business, Innovation and Skills will open practical and frank discussions with BIAZA.
Andrew Selous (South West Bedfordshire) (Con)
I shall be as brief as possible, given that many other colleagues want to speak in this important and popular debate.
When people ask me where my constituency is, I often say that I am the Member for Whipsnade zoo, because it is easily the best known institution in my constituency. Although I represent three towns and 14 villages including many wonderful historic houses, thriving businesses, wonderful churches and so on, the best known part of my constituency is Whipsnade zoo, which has around 0.5 million visitors a year. In common with other Members, I cannot resist giving a little plug while I am on my feet, even though it is not the main focus of our debate.
Whipsnade is the United Kingdom’s largest zoo, with 600 acres and 2,500 animals—I must say that to my hon. Friend the Member for Bosworth (David Tredinnick). People can walk or drive around it, or take the safari bus or steam engine. A range of attractions include cheetah rock, the lions of the Serengeti—including reference to the Selous game reserve, the largest in the world—and the rhinos of Nepal, or someone can be in with the limas or in the chimpnasium. Daily shows include the “Sealion Splash”, where people who get too close are liable to get quite wet, but it is good fun, and the “Peckish Penguins”. So I can tell the hon. Member for Edinburgh West (Mike Crockart) that Bedfordshire, as well as Edinburgh, has penguins. In Bedfordshire we also have not only Whipsnade but, close by, Woburn, with its wonderful safari parks. Bedfordshire is certainly doing its bit for zoos and for tourism in our area.
The Minister will be interested to know that in spite of our difficult times, I am told by David Field, the excellent director of Whipsnade, that visits to the zoo are on the increase and that the number of visitors has been the highest in the past 37 years of the zoo being open. That is excellent news because zoos, as many Members have said this morning, are not only wonderful institutions, where we learn about conservation and protecting our wonderful threatened animals around the world, but thriving businesses. In the summer, Whipsnade can employ up to 300 people directly, and there are many other jobs associated with such a major tourist attraction.
As far as Whipsnade specifically is concerned, it could do even better and contribute more to our local and national economies if there were improved public transport. Unlike some other zoos, which are in the middle of towns, Whipsnade is quite isolated; it is in the beautiful Bedfordshire countryside, high up in the Chiltern hills outside Dunstable. If we had better bus links, perhaps even a direct bus from Luton station, we could get more visitors, contributing even more to the local economy. Forty thousand school children went round Whipsnade last year—a significant part of their education.
Nia Griffith
Does the hon. Gentleman agree that there is a gap between when visitors come as children and when they return to bring their own children or grandchildren? How does he suggest that we might deal with that gap in the middle—the teenage years, the early 20s and so on—when we do not seem to be drawing in the people we would like to be getting in?
Andrew Selous
One way would be an innovative membership scheme, with repeat visits at reduced prices, so that people go regularly to their local zoo. The hon. Lady is absolutely right; we do not want zoos to be places where people go once every couple of years, but places they visit regularly, without those huge gaps. Pricing schemes that are a little easier on the pocket could be one way of dealing with what she rightly suggests.
Some of the representatives of zoos who are attending the debate have put it to me that it is not as easy for zoos to apply for lottery grants or heritage funds as it is for other organisations such as museums. Perhaps the Minister will kindly agree to look at that. We realise that money is tight, but the thrust of the debate, excellently started by my hon. Friend the Member for Romford (Andrew Rosindell), is that zoos are looking for dialogue with the Government and the Minister’s Department. They are having a positive effect on inward investment, creating more jobs and helping to get the economic growth that we need. The Minister is committed to leaving no stone unturned to promote economic growth in this country, so I am sure that he will want to see the zoo and aquarium sector playing the fullest possible part in the important job that he is undertaking for us.
Oliver Colvile (Plymouth, Sutton and Devonport) (Con)
I too congratulate my hon. Friend the Member for Romford (Andrew Rosindell) on securing the debate.
I have always been interested in the subject, mainly because I remember as a child watching “Animal Magic” with Johnny Morris, who did those wonderful voices. I was also brought up on “The Lion and Albert”; Members might remember that on a family visit to the zoo Albert was eaten by the lion, because at Blackpool the waves were “fiddlin’ and small” and it was not at all a nice place to have ended up.
I am delighted to be able to contribute to the debate because, as the Member of Parliament for Plymouth, Sutton and Devonport, I host the national aquarium, which is the largest in the country. It plays a major part in the regional economy, as well as contributing to the national economy. Last year, it received around 264,000 visitors, of whom 30,000 were schoolchildren. It employs between 72 and 75 people, some of whom work part-time, who make a significant contribution to the local economy. It had a turnover of around £2.5 million, and received a grant of £500,000 from the regional development agency for capital activity.
I was a candidate in Plymouth for a very long time—more than 10 years—and during the 2001 general election, when the countryside was closed due to foot and mouth disease, the aquarium in Plymouth became a major attraction because people could not go out to the countryside. I have been told that if it is raining in the morning, the local community knows that it will be inundated with people visiting the aquarium because they will not go to the beaches or into the countryside.
The aquarium plays a significant role as a major tourist attraction but, more importantly, it works closely with Plymouth university, which is one of the principal marine science engineering universities in the country. It is helpful that it is part of a cluster of activity, which is why Plymouth is one of the principal global leaders in maritime research. The aquarium moulds its exhibits and education programmes, and drives conservation projects very well and in a big way. It is run as a business, not as an organisation that receives Government handouts, and it ensures that it uses natural resources and encourages its suppliers and customers to act ethically. It is part of an industry that attracts paying graduates from all round the world, so it is an international organisation.
Next year, we will commemorate the death of Captain Scott of the Antarctic. Many people will know that if he were still alive today he would be my constituent. I regularly come across people who tell me that their grandparents used to steal apples from his garden—they could not do that now, as it has been built on. Plymouth will receive an enormous amount of attention because of Captain Scott’s death, and I hope that the aquarium will recognise that.
Another place that will ensure that Captain Scott’s death is commemorated is the Natural History museum, which will run a major exhibition from January to October. Next year will see an increase in the number of people wanting to go to the aquarium in Plymouth because there will be enormous publicity. In the last few weeks, we have watched David Attenborough’s “Frozen Plant”, and that too will be a major boost for the aquarium.
Without further ado, I thank you, Mr Bone, for allowing me to speak, and I wish everyone the best of luck and a very happy Christmas.
Stephen Mosley (City of Chester) (Con)
I thank my hon. Friend the Member for Romford (Andrew Rosindell) for giving me the opportunity to speak on behalf of the 7,000 animals from 400 species that live in my constituency at Chester zoo. It is Britain’s most popular zoo, and generates 1.4 million visits a year. It is regularly rated one of the top 15 zoos in the world.
Since its establishment in 1934, Chester zoo and the North of England Zoological Society has always been a charity and a members’ organisation, and has always had a social enterprise ethos. Because of that, Chester zoo has for more than 75 years been a big society success story. Today, it generates some £13.5 million in visitor revenue, and employs some 300 core staff year round, and 160 seasonal staff during the summer. It is a high-quality employer that brings good, long-lasting jobs to our local economy.
Like many zoos—we heard about Twycross—Chester is a leader in conservation, both at home and abroad. In the UK, it is responsible for breeding many native species and reintroducing them back into the environment, including sand lizards, dormice and harvest mice. It is also a centre of international excellence for breeding programmes with other zoos to provide an insurance policy so that many endangered species have a large enough population to ensure genetic stability. We are looking forward to the opening within the next couple of weeks of a £250,000 giant otter breeding centre, which will include underwater viewing areas with tunnels allowing people to pop up among the giant otters. It will include a breeding programme for giant otters, which are an endangered species from south America.
Chester zoo is involved in more than 150 field projects in 50 countries. It directly runs 10 major field programmes throughout the world, involving elephants, black rhinos, jaguars, the realm of the red ape, and a Nigerian project. Through conservation and research grants from the North of England Zoological Society, it funds more than 60 field projects around the world word, including projects on cheetahs and komodo dragons.
Like many zoos throughout the world, much of the Chester zoo’s international work is based in the far east, south Asia and south America, which are some of the fastest growing economies in the world. We have brands and zoos that are doing good work in those countries, and we should use their good name and their facilities to ensure that we sell Britain and British companies to those fast-growing countries to enable and support our economic growth. We have heard about research and educational facilities offered by zoos, and Chester zoo does all that.
I turn to what Chester zoo wants to do in future. It has huge ambitions. For the past two years, it has been drawing up a £225 million natural vision project, which hopes to transform the zoo over 12 years into one of the world’s largest and greatest animal and visitor experiences. The idea is to develop a series of themed zones, and to expand the size of the zoo by one third to make it one of the largest in Europe. As part of that proposal, it is planning to safeguard some 500 jobs, and to create 660 new jobs in the zoo and the local economy. The total cost will be £225 million, with the first phase costing some £90 million.
Planning approval was granted in November last year, but there are difficulties because the zoo was promised £40 million from the Northwest Development Agency, and that money is no longer available. It is now looking for alternative sources, and trying to rearrange its plans to ensure that it can deliver as much as possible through its own resources. It is being successful in that. Over the next couple of years, it is hoping to use its own resources to open an islands exhibit, which will focus on Madagascar, Mauritius, Sumatra and other south-east Asian islands. It will feature an Indonesian show house, boat rides, and underwater viewing of animals. It will house Sumatran orang-utans, tigers, komodo dragons, fruit bats and crocodiles. Part of the proposal is to build a 150-bed themed hotel within one of the themed zones.
The zoo’s idea in developing the natural vision project is to ensure that visitors will not have just a one-day experience, but stay the night in Chester, go to restaurants, and spend money in the local economy. We have noted that the zoo attracts a huge number of visitors, but many of them are day visitors. They catch a train or drive to Chester, visit the zoo and then go home again. We want to try to ensure that people come and stay the night. If they spend several days in Chester, they can visit not only the zoo but the other attractions that Chester has to offer. They might also visit Liverpool or north Wales in the wider sub-region. Chester zoo sees itself as an engine for growth locally. With its large, high-profile projects planned for the future, it can deliver real economic benefits.
The North of England Zoological Society at Chester zoo has huge ambitions, which is down to the work of the zoo’s director general, Mark Pilgrim, and Barbara Smith, the managing director. If the Minister is interested in seeing the good work that zoos do in the local economy and the good work that is planned for the future, Chester and the zoo will be happy to welcome him.
Simon Hart (Carmarthen West and South Pembrokeshire) (Con)
I thank my hon. Friend the Member for Romford (Andrew Rosindell) for giving us an opportunity to talk about places and things that we are passionate about: economic activity in our areas, tourism, and, in my particular case, the subject of learning outside the classroom, which has been mentioned by other speakers.
I will mention two examples of progressive zoos as opposed to zoos in the more traditional sense in Carmarthen West and South Pembrokeshire. We have heard about the conservation and education benefits, so I will not repeat those points. My two examples are perfect illustrations of those. However, we have not touched on the areas of job creation and job sustainability. In the two examples that I will refer to, there are jobs in marketing, finance, IT, animal husbandry, catering and retail, and jobs in the wider community in the secondary industries that rely on our progressive zoos. It is not just about tending animals and teaching kids about the wider world. There is a vibrant, important and sustainable job market in and around progressive zoos, even in small pockets of west Wales such as those I am lucky enough to represent.
My two simple examples include Folly Farm, tucked away in the village of Begelly in west Wales. I remember it as a farm by the road in 1988 where someone could call in and watch the Williams family milking their cows. A few years later, we had 400,000 visitors going through that establishment. It is renowned throughout Wales and the rest of the UK, and it is known further afield as a centre of excellence as a progressive zoo. It is now Wales’s largest paid-for tourist attraction. It has 60 employees—160 when it is at full speed in the summer months—and it is not too far down the road from the other classic example, which is the Manor House wildlife park run by Anna Ryder Richardson and her family.
I used the Folly Farm example to highlight economic benefits; I will use Manor House to highlight educational benefits. One or two colleagues know of my interest in learning outside the classroom. My point, which I hope the Minister will take on board, is that there is increasing evidence that learning outside the classroom brings profound economic benefits further down the line. These establishments take kids of varying abilities from all sorts of backgrounds and enable them to learn things in a different set-up from the traditional classroom scenario. The effects of this on the children and their teachers are fantastic. Some children are not particularly brilliant at classroom activity, but find that when they are in the company of animals or experts and other visitors in the zoo, it brings something out in them that a traditional education has not been able to discover. It improves their knowledge of food sourcing and nature, and their physical fitness and self-confidence in many different ways, and it makes them more rounded individuals. It means that they are more likely to be economically productive when they grow up rather than a drain on the nation. We must not underestimate the value that zoos offer. I hope that the Minister will see that the benefits amount to more than what is on the tin when we read about the zoo in our local paper or on a website. The contribution that zoos can make through the education system, which has an economic benefit, must not be understated.
I will mention the three things that we would like. We want recognition, which I am sure is forthcoming, of the sustainable economic activity, both primary and secondary, that the establishments provide, especially in more isolated rural areas. We want recognition of the value of learning outside the classroom, not as an alternative to a traditional education or as an alternative entertainment to which children can be subjected, but as something that brings real long-term economic value locally and nationally. We also want it recognised that, for some strange reason, zoos do not seem to be attributed the same value as museums or sports and science centres when it comes to funding from either national or local government. Their contribution and potential are obvious at every level, so it is strange that, for some reason, zoos get a second-class deal when it comes to potential funding.
The debate has been very worth while. I suspect we will hear more. I hope that we do, because history has shown that zoos are an active and positive element of economic growth, which we refer to in so many other areas.
Mark Garnier (Wyre Forest) (Con)
I too congratulate my hon. Friend the Member for Romford (Andrew Rosindell) not only on securing the debate, but on his very hard work on the all-party group.
Like many hon. Members, I am keen to contribute because I have in my constituency not just a zoo and an aquarium but an entire safari park. I am delighted to see the director of wildlife, who has come to see this debate, in the visitors gallery. We have been hearing about zoos making a local impact, but I can confidently say that a whole safari park does a huge amount more. Having an institution and tourist attraction like the West Midland safari park is important, because it adds to a comprehensive mix of local tourist attractions. Alongside the safari park is the Severn Valley railway, one of the biggest heritage railways in Europe and also an important tourist draw. Between them, they complement a tourist day out that comprises a visit to the Wyre Forest and to towns such as Stourport-on-Severn and Bewdley with their amazing riverside characters.
The tourist offering is significant to the local economy. As we know, one of the fastest ways of drawing in economic activity is through the tourism industry. It is estimated that these local attractions, which form part of the west midlands key attractions group, bring in many millions of pounds of economic benefit locally and some 750,000 visitors to Wyre Forest every year. West Midland safari park is more than just a tourist attraction. As a seasonal employer, it provides 250 extra jobs for school leavers every year. It seems there are few people in Wyre Forest who have not worked at the safari park at some point to gain early job experience. Indeed, the current leader of Wyre Forest district council was a ride operator in the amusement park.
An organisation like the WMSP has a huge amount more to offer. The safari park makes a massive contribution to animal research in a number of ways, from allowing researchers access to study animal behaviour and collecting physiological measurements, to supplying them with biological samples and animal records. The park also collaborates in projects initiated by endangered species breeding programmes, and with other zoological parks, national and international conservation bodies and university staff. In a measure to help educational projects, the park spends six months of the year hosting students from local universities who collect data for MSc and BSc dissertations on focal topics chosen by the WMSP. The park also encourages applications from professional researchers and postgraduate students who are involved in projects that are in line with their research missions.
The safari park hosts many rare and endangered animals. However, it is the economic commitment that the safari park makes to the local economy that I am most in awe of. When the main house of the estate, Spring Grove house, burnt down a few years ago, the managers of the park received an insurance payout. They took that money and tripled it to create an incredibly impressive local venue that in itself draws much economic activity. The managers also created the single biggest seated venue in Worcestershire with a tented function facility that can seat more than 400 people.
Finally, but most impressively, there are plans to create a 250-bed conference venue that takes advantage of the “Out of Africa” theme that only a safari park can offer. This will be the biggest conference centre in Worcestershire and will add to the incredible array of offerings that Worcestershire can make. The economic impact of the WMSP is incredibly important. I visit it frequently with my young family. It is a truly wonderful experience. To my constituency, it is an important local economic driver. It is an opportunity for school leavers to get work experience and a centre of excellence for research.
In conclusion, I am reminded of a conversation that I had with a constituent. He used to live in Karen in the suburbs of Nairobi. He told me that, despite living in Kenya for 15 years, it was only when he moved to Kidderminster that he could have a sundowner gin and tonic in his garden and listen to the lions roaring in the distance.
Mr Gordon Marsden (Blackpool South) (Lab)
It is a delight to serve under your chairmanship Mr Bone, and I warmly congratulate the hon. Member for Romford (Andrew Rosindell), who has added to his well-justified reputation as a champion of animal welfare in the House by presenting a cogent and compelling case for the economic role of zoos and aquariums. His case has been echoed by the wide and extraordinarily positive range of contributions that have come not only from my colleagues in the Opposition, but from across the Chamber, and included a cameo appearance by my right hon. Friend the Member for Leigh (Andy Burnham). He reminded me of his previous involvement with the Department for Culture, Media and Sport, not least with Knowsley zoo. We heard about an array of places: the east midlands, Cumbria, Wales, Northern Ireland, Whipsnade, Plymouth, Chester, and West Midlands safari park—I beg the forgiveness of hon. Members if I have left any out.
Together with the obvious promotions and the pride that hon. Members have shown for zoos and aquariums in their constituencies has been an underlying economic theme. Again, I congratulate the hon. Member for Romford because he put his finger on many of the issues concerning the blueprint for economic growth. Zoos can be used for outreach into other disciplines and can forge links with universities or research and development bodies. Perhaps the Minister will pass that message to his hon. Friend the Minister for Further Education, Skills and Lifelong Learning, because research in STEM subjects—science, technology, engineering and maths—involves not only higher education but further education and will be a key area in the future.
The hon. Member for Romford mentioned all the Departments that are involved with zoos, and I warm to that theme. Before becoming a Front-Bench spokesman, I spent 13 years working with Members from all parties to promote the seaside and coastal towns, and the Government need to work across silos to encourage and support such places. We have the same issue with zoos, and I warmly support and endorse the hon. Gentleman’s comments about the practical dialogue that is needed between officials from the Department for Business, Innovation and Skills and zoo organisations. I am sure that the Minister will respond positively on that point.
The hon. Gentleman described the Eden project as one of the most successful of its kind, and he put his finger on the fact that zoos often provide a point of entry to much broader economic activity, not only for tourism but in terms of educational and environmental activity. Hon. Members may smile initially at that point, but it is a central role for BIS and other Departments, especially in the context of grants and their close involvement with the Department for Communities and Local Government.
All hon. Members in the debate have their own personal anecdotes and background. I am a native Mancunian, and my fondest memories of the late-lamented Belle Vue zoo are not so much about the animals—although I am sure that they made an impression—as about the walk-through concrete whale that was a central feature of the zoo. It stimulated me at a precocious age to set up a bring-and-buy stall outside my parents’ house in aid of the World Wildlife Fund. As a reward for my efforts, I received an enamel panda badge, which goes to show that then, just as now, pandas were an iconic symbol.
It is clear that zoos play a crucial role in the local economy. According to statistics from Visit England, in 2010, zoos made up a quarter of the top 20 fee-charging visitor attractions in the UK, with well over 6 million visitors. As hon. Members have noted, that was recognised by the regional development agencies, some of which played a key role in boosting tourism in the regions and promoting zoos as part of an overall tourism programme. Sadly, however, the Government’s hasty abolition of RDAs led to some funding not going through, as with Chester zoo, and perhaps more subtly, it removed some of the expertise and internal, informal architecture that brought together further education, higher education and entrepreneurs to seek investment for new projects. If zoos and aquariums cannot find other local mechanisms to replace that investment, they will miss out. James Ramsbotham of the North East chamber of commerce recently said that One North East had done a particularly good job of promoting the north-east as a tourist destination, and as I know from my experiences in Blackpool, tourism initiatives are a key spur for economic growth.
Other hon. Members have mentioned their local zoos, so I will mention Blackpool zoo. It has a proud lineage and used to be owned by the council, although since 2007 it has been operated by Parques Reunidos, one of the largest operators in Europe. It, too, has a weird and wonderful collection of attractions such as the giraffe heights, wallaby walkabout and the dinosaur safari—the dinosaurs are not living, of course, but the safari exists. It also has Maisie, who in 2010 became the first western lowlands gorilla—an endangered species—to be born in the zoo. Such zoos work as a point of entry to other attractions in the town such as Stanley park, an iconic park from the 1920s and 1930s that has undergone major renovation in recent years and is adjacent to the zoo. Visitors to Blackpool are brought from the seaside and into the country and to Fylde, and that shows how points of entry can be used.
The Library has risen to the occasion, as always, and provided a brief for the debate. It mentions Chester zoo, which is in the constituency of the hon. Member for City of Chester (Stephen Mosley), and cites an interesting quotation from Charlie Seward, the director of regeneration at Cheshire West and Chester council:
“There is a real push in the city… We are seen as not keeping pace with the competition…from big cities such as Manchester and Leeds. We need to be putting in our own investment.”
That is a good example of how second-tier towns and cities are demanding the ability to utilise initiatives such as zoos.
A spokesman from Paignton zoo stated that it had been able
“to access grants through the South West Regional Development Agency and from Europe. Crocodile Swamp was part-financed by the European Regional Development Fund.”
If the Government do not get a move on over the European regional development fund, they might find themselves in a crocodile swamp of their own—that is a discussion for the Minister and I to hold on another occasion.
We need new local mechanisms to take forward initiatives such as zoos. That is why the recent Centre for Cities report argued that local enterprise partnerships were at a crucial stage and that the Government need to act fast to make further resources available. A start has been made with the recent announcement on cities the other week. I have always thought of the Minister of State in the Department for Communities and Local Government, the right hon. Member for Tunbridge Wells (Greg Clark), not as “disgusted” but as endlessly positive and energetic. If he were an animal, fictional or otherwise, he would be Tigger. He bounced up and down and talked about the importance of cities, but in this context, second-tier towns and cities, the seaside and rural and suburban areas adjacent to our large regional cities are also important. That is why my hon. Friend the Member for Streatham (Mr Umunna) recently called on the Government to hold a full impact assessment into the replacement of RDA funding and those groups that might have been left out, such as zoos and aquariums. It is welcome that Visit England has been allocated £20 million under the second round of the regional growth fund, and in his official discussions I urge the Minister to highlight the role that zoos can play.
Where will we be in 10 or 15 years’ time? People will not be buying masses of plasma TVs for Aunt Agatha’s 80th birthday; they will be buying her a trip to the zoo or another experience. We are in a world where we will be buying experiences, and zoos are very well placed for economic activity in that area, so I ask the Minister to go out and be a friend to the warthog, the wallaby, the ring-tailed lemur and possibly even the slothful panda, although given the extent of its consumption, I am sure that it would not fit with the Chancellor of the Exchequer’s lean-and-mean economy today. Does the Minister realise that—to adapt the traditional Hollywood film adage—“There’s gold in them thar zoos.”?
The Minister of State, Department for Business, Innovation and Skills (Mr Mark Prisk)
I add my congratulations to my hon. Friend the Member for Romford (Andrew Rosindell) not only on securing the debate, but on setting out the broad issues, which a number of hon. Members have also highlighted. I am not sure about the animal analogy and I shall spare colleagues by not taking it further. Let me simply say that I have never been good with reptiles, which is why, thankfully, I do not have to spend too much time with the tabloids.
Let me refer to some of the excellent remarks made by hon. Members. My hon. Friend rightly highlighted the heritage of the institutions. Incidentally, given the time left to me, I will use the phrase “zoos and aquariums” as shorthand; hon. Members whose constituencies contain safari parks and other attractions should not feel left out. My hon. Friend raised economic and tourism issues, which I will come to, but he also highlighted something that other hon. Members mentioned, which is that the first practical contact children have with the natural world is often through the local zoo, safari park or aquarium. It is right to highlight that social role. All of us can respond to that point.
My hon. Friend the Member for Bosworth (David Tredinnick) spoke of the excellent work of Twycross zoo. I am familiar with Twycross; I have met the senior managers there. My hon. Friend highlighted, as several other hon. Members did, the international role that zoos and aquariums can play. I am talking not just about what we do in this country, but about reaching back to some of the countries from which the relevant species originated, so that we think about a sustainable future more holistically. That is an eminently sensible and good point.
The hon. Member for Strangford (Jim Shannon) referred to what are clearly the delights of his constituency and how those local natural attractions have created some 400 jobs as part of the broader tourism industry. If we take that together with a stay-over not in Belfast zoo but certainly nearby, I think we have our Easter trip sorted out, for which I am grateful to the hon. Gentleman.
The hon. Member for Edinburgh West (Mike Crockart) appears to have added pandas to his penguin constituents—it looks as though his next constituency surgery will be much more interesting. He made the important point that zoos are businesses. That is part of this debate. Whether they are profit-making or charitable and therefore social enterprises, I certainly recognise that they are enterprises—businesses. That relates to the point made by my hon. Friend the Member for Romford. The whole of Whitehall—my Department included—needs to recognise that and engage in a cross-Whitehall dialogue.
My hon. Friend the Member for South West Bedfordshire (Andrew Selous), who is, as he rightly pointed out, the hon. Member for Whipsnade zoo, among other things, made the point by saying that he identified with that zoo—that safari park. That goes to the heart of the way in which people regard their area. It is something that they take pride in. He made this very good point: the fact that visitor numbers are rising shows that the public clearly value these institutions in their communities.
My hon. Friend the Member for Plymouth, Sutton and Devonport (Oliver Colvile) referred to the excellent national aquarium. I shall come to that. He referred in particular to links between universities and zoos. That point was well made.
My hon. Friend the Member for City of Chester (Stephen Mosley) raised a question with regard to the plans for Chester zoo. I understand the challenges and the ambitions, which are super to hear about. They involve not just the current otter breeding centre, but also the 10 overseas centres. My remarks in a moment will focus on the regional growth fund, of which there are two further rounds. The management may want to have a look at that to enhance the planned private sector investment.
We heard a contribution from my hon. Friend the Member for Carmarthen West and South Pembrokeshire (Simon Hart). The point about outside learning is right. It is important to understand that this is not necessarily just about an academic subject; it is about the experience gained through the learning process. Clearly, my hon. Friend has two excellent examples in his constituency.
Last but by no means least, my hon. Friend the Member for Wyre Forest (Mark Garnier) raised the excellent work at the West Midland safari park. It does not relate just to the conservation of endangered species; there are wider research projects. He ended with the marvellous image of someone enjoying a stiff gin while the sun sets over Kidderminster—a very good way to focus on the issue.
In the five minutes left for the debate, I want to focus on the economic and social benefits and make a couple of points about tourism, and refer to the engagement with Government and industry and to the wider issues that zoos, aquariums and other institutions face. The report by the British and Irish Association of Zoos and Aquariums, which examines the economic issues, makes significant statements that the debate has touched on. For example, when we consider indirect and induced effects, we see that these institutions provide some £645 million in terms of value in our economy. They are significant visitor attractions; the spending by tourists on-site of some £246 million is enhanced by additional spending of some £198 million in the surrounding area. That goes back to points made by hon. Members on both sides of the Chamber about how an attraction can be a focal point for wider economic opportunity.
The question is how we can ensure that, as part of tourism, these institutions are able to benefit. In March, the Under-Secretary of State for Culture, Olympics, Media and Sport, my hon. Friend the Member for Weston-super-Mare (John Penrose), who is responsible for tourism and heritage, set out a clear policy for tourism. It is about ensuring that the visitor economy, which is worth some £52 billion to the economy as a whole, is enhanced. It is about recognising the role that can be played not just in urban areas but, as my hon. Friend the Member for Carmarthen West and South Pembrokeshire pointed out, in rural communities—a very important addition.
This is an area where there are real opportunities for growth, but we want to ensure that the sector is both more productive and more competitive. Our domestic tourism industry offers good growth potential because at the moment this country sees fewer staycations—in plain English, that means people wanting to holiday at home rather than go abroad. A lower proportion of our population holiday at home than go abroad. I was looking at the number of zoos and aquariums in the list of top paid-for attractions in England, and interestingly it appears that three of the top 10 English paid-for attractions are indeed zoos and aquariums. A couple have been mentioned today. The three attractions are Chester zoo of course, London zoo and Flamingo Land theme park and zoo. Together, they secured 3.5 million visitors last year. That is more than Stonehenge and—dare I say it?—more than the Houses of Parliament, so clearly we have something to learn in this institution from the zoo industry. I will sweep gently over whether the inhabitants here are more or less interesting than those in zoos and aquariums. I will not go into that area, because I know that you want to ensure that I do not stray too far, Mr Bone.
It is important that we consider the wider issues. That means that there is a case for considering, as requested by my hon. Friend the Member for Romford, how the industry and Government can work more closely together, beyond just tourism. I stress the opportunities that exist in relation to the national funding streams. Yes, the RDAs have gone, but we have an opportunity with the £2.4 billion RGF programme, which has two further rounds to come. Some of the plans for the institutions that we have heard about today could well be proposals for those funds. In that regard, I encourage in particular my hon. Friend the Member for City of Chester: it is something that can work.
The role of local enterprise partnerships will be fundamental. Also relevant are the growing places fund and the enterprise zones. We are discussing areas where the existing institutions and future ones can play a role. Ministerial colleagues in both the Department for Communities and Local Government and my Department will want to encourage that.
Several hon. Members mentioned skills and science. These institutions are pivotal in that context.
Mr Prisk
I am in the last minute of my speech, so I hope that my hon. Friend will bear with me; I must respond to this point. Science and skills are very important. Biology, zoology and veterinary science are crucial. As we heard from my hon. Friend the Member for Plymouth, Sutton and Devonport, the national marine aquarium is a classic example of what can be achieved. These are fine institutions. They deserve to be looked at and engaged with by the Government as a whole, across Whitehall—I include my Department. The roles that they can play in relation to tourism, science, skills and, of course, conservation mean that they continue to deserve the Government’s full support.
Mr Peter Bone (in the Chair)
I thank Members for their attendance and their self-restraint, which meant that nine Back-Bench Members have been able to speak in the debate.
Israel
(13 years ago)
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Guto Bebb (Aberconwy) (Con)
It is a pleasure to serve under your chairmanship, Mr Bone. I am pleased to be able to raise the issue of Government policy towards Israel in a quick, half-hour debate. Before I do, however, let me draw Members’ attention to my entry in the Register of Members’ Financial Interests, where I declare a trip I made to Israel about a year ago.
This is an important issue. The relationship between the UK and Israel has always been strong, and the UK has always been a constructive partner. At times, it has been willing to inform the Israeli Government of the need to move faster towards an accommodation with the Palestinians. At the same time, there has always been a relationship of respect and trust between the two Governments, and that has been clear not only in politics, but, very impressively, in business. The business relationship between the UK and Israel is extremely heartening, and it was most encouraging, on my visit to Israel in February, to see how the Israeli business community saw the UK as a good partner in terms of development.
It is interesting that despite the fact that the Israeli state has been extremely effective at developing the Hebrew language and culture—we in Wales have tried to follow it in reviving our own language and culture—the English language remains an important binding issue for the business community. Traditionally, Israel has perhaps looked towards the United States, but under our current ambassador, there is a developing business link between Israel and the UK. We therefore have a strong relationship with Israel, and we have been able to be a critical friend. That is a good position.
Sir Alan Beith (Berwick-upon-Tweed) (LD)
I am grateful to my hon. Friend for bringing forward this issue. Do some of those who, quite understandably, want to criticise particular Israeli Government policies not sometimes need reminding that there is no criticism they make that will not be heard in Israel’s vibrant democracy? It is much easier to work with a country that has as vibrant a democracy as Israel, even if we have criticisms of its policies.
Guto Bebb
I am grateful for that intervention from my right hon. Friend, who is a Liberal. When my colleagues and I were in Israel, one of the things we found quite amusing was that we, as MPs, occasionally complained about the fact that we had a coalition between two parties in Westminster. Obviously, Israeli politicians said they would be absolutely delighted if they could have a coalition between just two parties. Israel’s proportional representation system means that it has a vibrant political system, in which criticism of Government actions happens regularly.
Paul Flynn (Newport West) (Lab)
I was delighted to hear the hon. Gentleman refer, I believe, to a poem by Saunders Lewis, in which he urges Wales to follow the example of Israel, particularly in terms of reviving its language—it is a poem of great optimism. However, does he not agree that there is a world of difference between the Israel of Yitzhak Rabin and the Israel of Netanyahu?
Guto Bebb
I am grateful for that intervention, and I will come to that issue in due course, because I want to talk about the attitudes of the world press and of other Governments towards the current Israeli Prime Minister. I think his actions do not justify the way he is often attacked and portrayed badly in the media.
Let me turn, however, to our Government’s policy towards Israel. In a conflict situation, there is no doubt that the use of language is extremely important. In that respect, I am delighted to see the hon. Member for Newport West (Paul Flynn) here. When we discuss such issues, language is important. I can vouch for the fact that the hon. Gentleman and I have disagreed on numerous occasions, but I know for a fact that there is not a racist bone in his body. However, a few weeks ago, because of a possibly inappropriate use of language, he found himself in difficulties. The use of language is therefore important.
That is why I requested this debate. The Foreign Secretary recently made a statement on issues in the middle east and north Africa, in which he gave his usual robust explanation of the Government’s position. What that statement perhaps revealed, however, was an imbalance in the use of language. There was almost an implication that the lack of movement on the peace process was the fault of the Israeli Government, and the Israeli Government alone. When we have such debates, it is important that there is a degree of balance, but I think there was a lack of balance in the statement, given the expectation that any move would have to come from the Israeli Government.
It is worth quoting the Foreign Secretary’s words:
“For Israel, the only means of averting unilateral applications to the UN is a return to negotiations. A demonstration of political will and leadership is needed from both sides to break the current impasse”—
I welcome that comment, but the Foreign Secretary continues:
“This includes the Israeli Government being prepared to make a more decisive offer than any they have been willing to make in the past.”—[Official Report, 9 November 2011; Vol. 290, c. 535.]
That indicates a degree of criticism of the Israeli Government by the UK Government, and we have to ask whether that criticism is fair and balanced.
It is clear that peace will be achieved only through negotiation. We know that to be the case, and every Member in this debating Chamber would agree that peace will be achieved only if both parties come to the table and discuss how to create the two-state solution we all want and that we all know is the only way forward for peace in the region. However, it is important to state that if we are to have negotiations, both parties need to engage, and the problem with the statement was that it indicated that the process had stalled because of the lack of an offer from the Israeli Government. To an extent, that ignores history. Perhaps we should ignore history more in the middle east, but the truth is that we need to understand that the Israeli state has made numerous efforts over the past 10 or 12 years to make a clear and generous offer. As yet, there has not been a response from the Palestinians.
Mr Matthew Offord (Hendon) (Con)
My hon. Friend is making an eloquent speech. He is quite right to say that Israel has made many such offers. In 1979, for example, it made its offer to Egypt, and the agreement between the two countries has been very successful. In 1994, it made a similar offer to Jordan, which has also been very successful. In 2005, it made what many consider a huge sacrifice by removing itself from Gaza. History has shown that the Palestinian side did not accept that in the spirit the Israeli Government intended.
Guto Bebb
I am grateful for that intervention; indeed, I suspect I can now throw away two pages of my speech. The Camp David accords of 2000 were a major offer for peace by Israel. I think I am right in saying that if the offer had been accepted, something like 97% of the land in the west bank and Gaza would have been available to create a viable Palestinian state. Indeed, in that regard, the highlight of my visit to Israel and the west bank was my visit to Ramallah, which was not the third-world enclave I had been told to expect, but a vibrant city that was growing and clearly prospering. It was perhaps not growing to the extent it should have been, but it was growing by 10% per annum, and I am sure the Chancellor would be delighted to swap.
The point I raised about the Camp David accords is extremely important, because the offer of 97% of the land in return for peace stalled on Israel’s demand that the Palestinian Authority included in the agreement a statement that the agreement would end the conflict. When the British Government say that Israel has to make a generous offer, we in the UK must be very aware of its demand for an end to the conflict. After 30 years of waste and loss of life in Northern Ireland, we managed to bring all the parties, including the British Government, to the negotiating table, and a key element was the demand that the republican movement in the north of Ireland accepted that there was an end to the war. In terms of creating trust, it is imperative that both parties feel that the negotiation will finish the conflict, and that the option of going back to the conflict is not allowed.
The Camp David accords failed on Israel’s claim that the Palestinian Authority would have to agree that there was an end to conflict, and it is extremely disappointing that that did not happen. In addition, of course, the Israeli Government took the decision to move out of Gaza in 2005. Time and again we are told that the crisis and problems in the middle east—
Jim Shannon (Strangford) (DUP)
The hon. Gentleman mentioned the Northern Ireland situation. Clearly, there had to be an understanding from all parties on both sides of the community that violence does not work. Perhaps there was an understanding, after 30 years of campaign and conflict; perhaps people realised that the gun, the bullet and the bomb do not work. That is a key aspect of what is happening. Is there a realisation among the Palestinians—perhaps there is among the Israelis—that that should happen?
Mr James Clappison (Hertsmere) (Con)
The Palestinians have a just cause and the Palestinian Authority have responsible and respectable leadership, but is there not a large problem in the shape of Hamas, which my hon. Friend has mentioned? Would he welcome hearing from our right hon. Friend the Minister whether there has been any movement at all from Hamas on recognising the state of Israel, giving up terrorism and abiding by its international commitments?
Guto Bebb
That is, indeed, one of the questions I was going to put, but now that my hon. Friend has made the point I am sure that the Minister will respond to it.
The 2005 decision to pull out of Gaza was met not with a break in hostilities but, rather, with continued attacks on Israel from Gaza. The situation in Gaza is a crisis and is unacceptable, but it is also unacceptable that a state such as Israel faces attacks from land from which it has withdrawn. It is important to point out, when the issue of settlement is discussed, that the Israeli leadership expended significant political capital in pulling out of Gaza. The decision to uproot settlers from Gaza was right, but we should not underestimate the political capital that the Israeli Government lost in making it.
Mike Freer (Finchley and Golders Green) (Con)
I am grateful to my hon. Friend for obtaining this important debate. It is important that we have balanced debate on the peace talks. Does he agree that a strong Prime Minister goes into negotiations defending the national interest with clear red lines and that that is the secret to good negotiation? Asking one side to give up all its bargaining chips, such as settlements, in advance of negotiations, is clearly nonsense.
Guto Bebb
I tend to agree. I thought for a second, when I heard about a strong leader and red lines, that we were back in the Democratic Unionist party debate on Europe; so, yes, I agree entirely.
In addition to what happened in 2005, another offer was made in 2008, which would have resulted in 93% of the land mass of the west bank and Gaza being available for a viable Palestinian state, including a land link between them, which is critical. Again, that was rejected by the Palestinian Authority. I am not here to demonise the Palestinian Authority, but they must be partners for peace, and I have given three examples from the past decade when a partner for peace was not there.
Graham Evans (Weaver Vale) (Con)
I congratulate my hon. Friend on securing the debate. Does he agree that one of the key things for lasting peace is business, working together? If we could get the two states to work together in business, there is nothing that the Israelis would like more. Hamas and terrorists filled a vacuum in Gaza. However, I visited Ramallah and the new Palestinian city of Rawabi, and there is a fantastic opportunity for two peoples to come together—the next generation of Palestinians and Israelis, working together in peace and harmony through business and international development.
Guto Bebb
I agree entirely. That emerging city is indeed a testament to the development of the west bank. I agree that the prosperity and viability of the west bank is crucial to any move towards peace.
Prime Minister Netanyahu is subject to regular criticism, which ignores three important points. The first is that peace in the middle east has always come from the initiatives of the right in Israeli politics. That might not be something that some hon. Members in this Chamber would appreciate, but, in truth, the 1979 agreement with Egypt was the result of the efforts of Prime Minister Begin, and the 1994 agreement with Jordan that has been mentioned came from the leadership of the right. It is important to bear in mind that if the right in Israeli politics is moving towards peace, that offers the opportunity for a unified approach.
In the same way, comments about the Prime Minister of Israel ignore his words. Time and again he has made it clear that he is ready to negotiate anywhere, with anyone. I am not here to defend him; I am trying to offer some balance. In a speech in 2009, he said clearly:
“I appeal to the leaders of the Arab countries and say: Let us talk about peace. Let us make peace. I am willing to meet at any time, at any place”.
He followed those comments in 2011:
“Let’s meet here today in the United Nations. We have to stop negotiating about the negotiations. Let’s just get on with it. Let’s negotiate peace.”
Those are not the words, in my view, of a Prime Minister who is unwilling to talk about peace.
Andrew Percy (Brigg and Goole) (Con)
I congratulate my hon. Friend on securing the debate, because, like him, I was extremely concerned about the words of the Foreign Secretary, where the emphasis seemed to be very much on Israel. I want to add another quotation from Mr Netanyahu:
“Israel will not be the last state to welcome a Palestinian state into the United Nations. We will be the first.”
My hon. Friend is right to emphasise the point that Netanyahu is expending considerable political capital on the issue. Far from being the ogre and pariah that he is made out to be, he has committed himself time and again to peace and negotiations.
Guto Bebb
Again, the record, but, unfortunately, not necessarily the media in this country, would support that view.
More important than words are actions, and in 2009-10 there was a freeze on all settlement activity. For a right-wing politician in Israel that is a brave move. The 10-month freeze was met with nine months of no activity by the Palestinians—another missed opportunity.
Paul Flynn
We all condemn the incessant use of rockets by Hezbollah and Hamas, but is there not another danger, given what is happening in Tehran, with the explosions, assassination of scientists and cyber-attacks, that we are in a perilous situation that could lead to war? I believe that the hand of other countries can be seen in what is happening in Tehran, and that is likely to provoke it into a shooting war.
Guto Bebb
I am sure that all Members of the House agree that the situation in Iran is dangerous and are concerned about that regime having access to nuclear weapons. Again, negotiation would be a much better option than direct action, and I am sure all hon. Members would agree on that too.
The final point that I wanted to make about the Prime Minister of Israel is that in September 2011 he fully accepted the Quartet initiative, which was the basis on which negotiations could restart. Again the response of the Palestinian Authority has been to obstruct the process and provide the Quartet with evidence without consultation with Israel. The whole point of the Quartet initiative was to ensure that proposals would go forward in tandem with Israel and the Palestinians. That did not happen. Time and again Israel has made generous offers, which have been rejected. That is not to say that it should not continue to make generous offers. It is simply to say that the exhortations to Israel to make the next move ignore the reality of the past 10 years.
The context of the statement to the House was the near euphoria in this country about the changes in many parts of the Arab world, which have been welcomed on both sides of the House. We welcome changes and moves towards democracy in Egypt. There has been a brave effort in Syria to deal with a regime that has been, to say the least, unkind to its people. There is successful democracy in Tunisia, and we all welcome those changes. However, it is crucial to put them in the context of how they appear to someone living in an Israeli state where the borders suddenly look extremely vulnerable for perhaps the first time in 30 years. Israel’s land border with Egypt has been a solid part of its security for the past 30 years, but suddenly there is a question as to where it is going. Syria has never been a friend of Israel, and no one in the Chamber would claim that it was; however, the border between them has been stable for a generation. Discontent is clearly being shown in Jordan, and that border too has been a successful part of the peace process in Israel. Israel seems to be threatened by change on all sides. Finally, the malign influence of the Iranian regime is present in both southern Lebanon and the Gaza strip. That, again, is part of the context that was missing from the statement.
I have three or four questions, and I would appreciate it if the Minister could respond to them. First, why did the statement ignore the efforts made by Israel over the past 10 years? That is a reasonable question. Secondly, why did the statement almost fully argue that the expectation was that Israel should make the next move? Israel certainly has to make a move, but to say that the onus is entirely on Israel’s shoulders was questionable. Thirdly, why was no equal and corresponding demand made of the Palestinian Authority to show a degree of flexibility? Finally, why did the statement ignore the context? As I said, although we welcome the changes, we must acknowledge that they look threatening to a state of 7 million people surrounded by potentially hostile neighbours.
The Israeli Government have shown a willingness to engage. I believe that the only way forward is a two-state solution, which will happen only through negotiation. The British Government, with our experience in Northern Ireland, can contribute positively to that debate, but the debate needs a balanced approach and balanced language.
The Minister for Europe (Mr David Lidington)
First, I congratulate my hon. Friend the Member for Aberconwy (Guto Bebb) on securing this debate. The attendance of a large number of my right hon. and hon. Friends and hon. Members from other parties at this 30-minute debate indicates the importance that the House attaches to both the bilateral relationship between the United Kingdom and Israel and to the wider issues concerning the middle east peace process, to which my hon. Friend the Member for Aberconwy alluded in his opening speech.
I want to make it clear at the start that the Government see Israel as a key ally and friend of the UK. That does not mean that we agree on everything—we do not hesitate to express our disagreements with Israel where we feel that to be necessary, and successive Israeli Governments have done exactly the same with successive Governments here in London. We enjoy a close and productive relationship with the Israeli Government, and that very relationship allows us to have the candid discussions that are often necessary between friends.
As a number of hon. Members have said, the potential for collaboration between the United Kingdom and Israel is enormous. Our partnership in the high-tech industry could become one of the drivers of Britain’s economic growth. There is a long way to go before we get to that point—America still remains the first thought for an Israeli entrepreneur thinking about international co-operation—but we need to change that mindset, and we have taken some important steps this year towards that goal.
First, in October, during a visit to Israel, my right hon. Friend the Chancellor of the Exchequer launched a Britain-Israel high-tech hub. It is a new team, based in our embassy in Tel Aviv, tasked with promoting the high-tech partnership, with staff drawn entirely from the high-tech sector. Its job will be to help find partners for Israeli companies, bring the best of Israeli innovation to British companies and help our two economies to exploit each other’s potential.
Secondly, also in October, my right hon. Friend the Minister for Universities and Science went to Israel, too, with a high-powered delegation from our digital industries. We intend to continue the exchange of delegations from across the high-tech sector in the coming year.
Finally, regarding political initiatives, my right hon. Friend the Prime Minister and Israeli Prime Minister Netanyahu have agreed to launch a UK-Israel high-tech council. It will meet twice a year, once in the UK and once in Israel, to make sure that our strategy is right.
I could point to other examples of increased co-operation between our two countries. For example, in science and innovation, a major conference on regenerative medicine took place in November. Another example is education, where we are planning a campaign to ensure that the United Kingdom resumes its place as the destination of choice for Israeli students. A third example is cultural co-operation, where the work of the British Council and bilateral exchanges between Israel and the United Kingdom are helping to bring about a greater understanding of the culture of our two countries.
Paul Flynn
The political editor of The Daily Telegraph has alleged that a meeting that took place in February this year between the previous Defence Secretary, Adam Werritty and others was attended by Mossad. As the report that we have on the matter decided that that was a private meeting, is it not time that we looked at the policy followed by Mr Adam Werritty as possibly something that would lead to a conflict with Iran and had a legitimate report into the Adam Werritty-former Defence Secretary affair, because the only enforcer of the ministerial code is Philip Mawer—
Mr Peter Bone (in the Chair)
Order. I am afraid that that is far too long for an intervention.
Mr Lidington
I think that it was an ingenious attempt by the hon. Gentleman to import some completely irrelevant material into a debate about an important subject. There has been a full report by the Cabinet Secretary and numerous parliamentary questions from the hon. Gentleman and others. I do not propose to go beyond the responses provided in those documents this morning. I shall move on to the middle east peace process, which was the subject of a large part of the opening speech of my hon. Friend the Member for Aberconwy.
Mr Lidington
I have five minutes to speak, and I want to try to reply to what has been said. I hope that my hon. Friend will forgive me.
The events in the Arab world this year reinforce the urgent need to make progress on the middle east peace process. We are clear that a solution cannot be imposed from outside. We believe that both parties—I emphasise that—need to redouble their efforts to break the impasse and resume negotiations on a two-state solution to the Israeli-Palestinian conflict before the window to such a solution closes. Neither side can afford to let the opportunity for peace slip further from its grasp. A successful outcome will require good will and a willingness to compromise from both sides.
To respond to an intervention by, I think, my hon. Friend the Member for Hertsmere (Mr Clappison), if Hamas is to be regarded as a player in the peace process, it needs to show that it is genuine about making concrete progress towards accepting the Quartet conditions, which will form the basis of any enduring peaceful settlement.
We have been clear in our call for negotiations on a two-state solution without delay and without preconditions, based on the timetable set out in the Quartet statement of 23 September. In our view, the parameters for a Palestinian state are those affirmed by the European Union as a whole—borders based on 1967 lines, with equivalent land swaps; a just, fair and realistic solution for refugees; and agreement on Jerusalem as the future capital of both states.
It is clear from what I have said about land swaps that we expect—I think that both parties do—the final status of settlements to be addressed in negotiations. I believe that Israel’s announcement last month that it would accelerate the construction of a further 2,000 settlement housing units was wrong and deeply counter-productive. That was the eighth announcement of settlement expansion in six months, and there have been further such announcements since.
Settlements not only are illegal under international law and in direct contravention of Israel’s road map commitments, but more practically, represent an attempt to create facts on the ground, which will make a two-state solution, with Jerusalem as a shared capital, even harder to achieve. We have called on Israel to reverse its plans to accelerate settlement construction, and we are clear that we believe that all settlement activity, including in east Jerusalem, should cease immediately.
We were concerned by the Israeli Government’s decision to withhold tax revenues to the Palestinian Authority, which we believe was provocative and against Israel’s own interests, because it had direct implications for the Palestinian Authority’s ability to maintain effective security in the west bank. My right hon. Friend the Foreign Secretary made clear our view on 3 November, and we welcome the fact that Israel has subsequently released the funds. We urge the Israeli Government to maintain a predictable and regular transfer of such revenues.
I do not propose to go into detail about our approach to the Palestinian application to the United Nations; the Foreign Secretary has spoken about that before. There is no time to waste in making progress towards peace. Successful negotiations are the best way to give the Israeli people the long-term security that they yearn for and deserve, and the Palestinian people the state to which they are entitled. Doing nothing is not an option, and the Government remain committed to working with the Palestinians, the Israeli Government and other international partners to make progress towards a negotiated agreement. We will continue to develop our bilateral partnership with Israel, while not ceasing in our efforts to support both parties in finding a long-term and sustainable solution to the broader Israeli-Palestinian conflict, which has dragged on for too long.
Dyslexia
(13 years ago)
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Kelvin Hopkins (Luton North) (Lab)
It is a pleasure to serve under your chairmanship, Mr Weir, possibly for the first time. Forgive me if I am wrong.
This debate on dyslexia was initiated following a meeting of the all-party parliamentary group on dyslexia and specific learning difficulties, which raised three particular concerns: first, the changes to the examination access arrangements issued by the Joint Council for Qualifications; secondly, the Green Paper—I will not read out its title—of which we are aware; and thirdly, the continued need to include in initial teacher training the teaching of children with dyslexia.
I am pleased to lead the debate. Dyslexia is an important subject and is of concern to millions of our fellow citizens and constituents. Astonishingly, one in 10 of the population experiences dyslexia to some degree. The condition stays with people for life. Some people can accommodate it to an extent on occasions; others find that more difficult. Like colour blindness, it is a condition that is hidden and sometimes not even recognised. I am sure we all have friends, relatives and certainly many constituents who are dyslexic. The lives of millions of adults have been affected by dyslexia.
Even now, many people live with their dyslexia unrecognised, particularly those of my generation. I suspect I am the oldest person in the room. In my day, it was a strange word; nobody in my experience knew the word dyslexia. There were no doubt children in classes when I was at school who were constantly punished and treated rather cruelly sometimes because they could not spell or read. There was no understanding that they had an inherent difficulty or disability.
Dyslexia affects people across the ability range; it is not limited to people with learning difficulties. Many famous and celebrated people suffer from dyslexia, and it can affect people who are highly intelligent. I give as an example one of my relatives. He failed the 11-plus, essentially because he was dyslexic, yet he finished up studying physics at Imperial college later in life. He is clearly a man of considerable intelligence who could not pass the 11-plus because he was dyslexic. Our concern today is that teachers often lack the skills to identify and support dyslexic children, who need to be diagnosed and given extra support.
As a member of the all-party group, I was pleased when my right hon. Friend the Member for Morley and Outwood (Ed Balls), Secretary of State for Children, Schools and Families in the previous Parliament and now shadow Chancellor, commissioned a report on education and dyslexia, which became the Rose review. Rose recommended that initial teacher training should include dyslexia and special learning difficulties. However, currently there is no mandatory level of dyslexia training that must be provided in initial teacher training courses.
It is of great concern that little action has so far been taken to implement fully the recommendations of the Rose report. Indeed, the situation is worse, in that thousands of academically gifted teenagers with conditions such as dyslexia have lost the right to extra and other help in A-level and GCSE papers, under a crackdown by exam bodies introduced by the Joint Council for Qualifications.
Graham Stringer (Blackley and Broughton) (Lab)
Has my hon. Friend read the report of the Science and Technology Committee on literacy interventions from two years ago? If he has not, I will quickly read two quotes from it:
“The Rose report’s definition of dyslexia is exceedingly broad and says that dyslexia is a continuum with no clear cut-off points. The definition is so broad and blurred at the edges that it is difficult to see how it could be useful in any diagnostic sense.
The Government’s focus on dyslexia, from a policy perspective, was led by pressure from the dyslexia lobby rather than the evidence, which is clear that educational interventions are the same for all poor readers, whether they have been diagnosed with dyslexia or not.”
Will my hon. Friend take a look at that report? I am sure it would help him in his work on the Committee.
Kelvin Hopkins
I thank my hon. Friend for his helpful intervention. We are aware that there is an enormously broad spectrum, from slight spelling difficulties to almost an inability to read. At the same time, there is a definite difference between those who have a degree of dyslexia and those who just have difficulty learning to read, perhaps because they are educationally challenged. Clearly, we need rigorous teaching of reading. In a completely separate context, I am strongly in favour of more rigour in the way we teach young people to read and to learn mathematics and other subjects. I take note of what my hon. Friend said. No doubt the Minister and my hon. Friend the Member for Washington and Sunderland West (Mrs Hodgson) will also respond to his points.
The JCQ rules clearly discriminate in that the measurement scores they use affect some youngsters and not others; some are excluded from help and others get help, because of an arbitrary decision by the JCQ on what their needs are. Complaints have been made about that by parents and teachers across the country, including Helen Wright, president of the Girls’ Schools Association, who said that a number of sixth-formers, without being given extra time for exams or other help, would
“definitely fail, and unfairly so”.
There are those who will suffer from the application of the rules who would otherwise do better. I hope the Minister will respond and give further consideration to the question of the arbitrary cut-off point.
Many thousands of children across the whole ability range are not getting the help they need, and are not even being diagnosed, because of the lack of specific training for teachers. There are no doubt some who, even today, do not recognise dyslexia, thinking it is just about youngsters who are not very good at reading, and do not recognise it as a specific and identifiable problem for some people. The problems experienced by those youngsters are distressing for them but they are also damaging to the economy and society as a whole. Clearly if youngsters are becoming disillusioned with education because of their dyslexia difficulties they drop out of school, education or training or have difficulty with apprenticeships and so on. That is damaging not just to their lives but to the economy and society in general. Help for dyslexics to succeed in education at whatever level is a matter, therefore, for national concern and Government action. The Rose review should be implemented in full and the JCQ rules withdrawn.
Although I am not dyslexic, I have taken a particular interest in the phenomenon. I know that it is not easily overcome, but a variety of coping strategies can be enormously beneficial. The academically gifted can perhaps apply those more readily, but there are millions for whom it is more of a struggle. I was recently approached by a group of Labour councillors from Thanet, not because I am their Member of Parliament, but because I happen to be a Labour member of the all-party group on dyslexia. They gave me some interesting statistics from their area. They are concerned that youngsters from the most deprived areas of the constituency were not getting the help they needed and were falling further behind, exaggerating the educational gulf between their achievement levels and others, even those who might have dyslexia. They want the Rose recommendations implemented as a matter of urgency to address those problems.
The Rose review proposed among other things the training of 4,000 specialist teachers in dyslexia over a two-year period. That is quite a tall order, but that is what he recommended. If we are going to approach and attack the problem seriously, we need to follow that recommendation. Other recommendations were to boost early identification from year 1 and effective intervention for pupils with dyslexic difficulties, to make provision for dyslexia-awareness training for existing teachers, to put more special educational needs training into initial teacher training courses and to acknowledge the need for specialist teachers and one-to-one interventions for severely dyslexic pupils. The review also recommended that schools build a positive dialogue with parents and provide them with relevant information, and provide support for children with dyslexia on transfer to secondary school, and that there should be continuing helpline advice for parents and teachers.
Dyslexic children have just as much right as any other child to be educated by teachers who understand them and their condition. We have made enormous progress in recognising dyslexia since the dark days of my childhood, but we must now demand the necessary support and resources for our dyslexic children, and only the Government can provide them.
Mrs Sharon Hodgson (Washington and Sunderland West) (Lab)
It is a pleasure to serve under your chairmanship, Mr Weir. I fear that the vote in the House has caused disruption for many people who intended to be in this debate, but what we lack in quantity we will make up for between us in quality.
I thank my hon. Friend the Member for Luton North (Kelvin Hopkins) for securing this timely debate. As he said, I was at the meeting of the all-party group on dyslexia and specific learning difficulties at which he resolved to apply for this debate. His success in doing so gives us a great opportunity to take forward the discussion we were having in that meeting, along with the hon. Member for Bridgwater and West Somerset (Mr Liddell-Grainger), the noble Lords Addington and Clement-Jones and representatives from the main dyslexia organisations. We will continue that debate here today, and I hope we will receive responses from the Minister to some of our concerns.
I want to record my thanks to the Dyslexia-SpLD Trust, Dyslexia Action, the British Dyslexia Association and Patoss for not just the excellent briefings they provided in advance of the debate but for the work they do day in and day out to unlock the world of words for dyslexic people, particularly children and young adults. My hon. Friend the Member for Luton North gave an excellent speech, which drew on the many concerns that those organisations have raised with us about the current direction of travel in the education system—concerns shared by anyone with an interest in helping young people with special educational needs get the most from life.
My hon. Friend the Member for Blackley and Broughton (Graham Stringer) commented on the thinking that dyslexia, rather than being a disability, is to do with a very wide reading ability spectrum, along which most of society would fall. He knows that I disagree with him on that point. There is a huge amount of evidence that proves that dyslexia is a very real and significant disability, especially at the extreme end of the spectrum where it goes way beyond a problem with learning to read and affects memory and organisational ability.
Kelvin Hopkins
I am sure that we have all come across friends and relatives who have slight spelling disabilities, particularly with unusual names and foreign words. At that end of the spectrum, we are not talking about an inability to read. I am sure that my hon. Friend agrees that there is a difference between those of us who fairly quickly pick up names and foreign words and those who do not, and that is, I believe, the thin end of the dyslexia wedge.
Mrs Hodgson
I agree. My son is severely dyslexic, and it affects not just his spelling and writing capability. Dyslexics are often much slower in learning to speak, and when my son was younger the condition affected his speech. He was three before he first said a word that was understandable to others—I could understand his grunts and moans a bit earlier. He has very bad memory problems and organisational ability; dyslexia really does affect a large part of his life. My daughter has been a bad speller most of her life—she is 16 now and her spelling is getting a bit better—but in no way would I say that she has dyslexia as I know it. They do say, however, that the condition runs in families, so she might fall somewhere on the spectrum if she was ever tested.
Graham Stringer
I follow the people who do not take my hon. Friend’s view, such as Diane McGuiness and other academics who gave evidence to the Science and Technology Committee, but I was not trying to make the point that there is no complete scientific agreement that dyslexia exists. I was saying that having carefully considered the definition and how it was applied, the Committee came to the conclusion, which I will repeat, that the
“definition is so broad and blurred at the edges that it is difficult to see how it could be useful in any diagnostic sense.”
The Committee was concerned that because of the use of the term, people who had difficulties learning to read and who were not diagnosed were being discriminated against.
Mrs Hodgson
Obviously, I am not an expert in the diagnosis of dyslexia, but there are people who are, and when they do the various tests what comes out is something called a spiky chart. Where there is a huge disparity between performance in non-verbal reasoning and other tests of intelligence on the one hand and reading and writing ability on the other, it becomes very obvious that someone is dyslexic. If someone has not very good reading skills but equally does not have high levels of intelligence, they have a flatter profile. Perhaps at the lower edge of the spectrum, as my hon. Friend the Member for Luton North has said—this is getting into a very technical conversation—diagnosis might be difficult and there might be blurred edges, but as we progress along the spectrum I do not think that the edges are blurred. Again, however, I am not an expert.
Kelvin Hopkins
My hon. Friend touched on dyslexia being an inherited characteristic, and I am sure that we all know families in which a parent is dyslexic and one or more of their children is. Two male friends of mine who are graduates have three children each, and dyslexia has affected only one child in each family, with that child having a serious spelling disability. All six children went to university and graduated.
Mrs Hodgson
The chair of our all-party group, the hon. Member for Bridgwater and West Somerset, is dyslexic, and I believe that his two sons are also. Yes, it is a trait that runs in families, and that is recognised.
Most Members here today know of my personal interest in this issue, as a mother of a severely dyslexic son. My son was unfortunately not diagnosed or helped anywhere near soon enough. The Minister also knows very well most of the concerns that have been raised today, because we have already had debates on the matter and have been in correspondence recently. I thank her for her comprehensive response to my first letter, and I look forward to her response to my reply, which she might preview today.
I wrote that first letter because I had started to see how various changes in education policy could, when taken together, start to put children with certain special educational needs at a disadvantage, and I used dyslexia to illustrate my point because that was the SEN I had personal experience of and knew best—I could see how the changes would have affected my son if he had been coming up to the start of key stage 4 now. I have no doubt that the potential effect is not desired at all by the Minister or her officials, and that it is one of those unintended consequences that we sometimes do not see unless we are looking at something from the outside, or until the effect has begun to manifest itself in statistics.
There are a number of issues on which I will touch briefly. My hon. Friend has mentioned many of them already. It is best in most narratives to start at the beginning, and in this case the beginning is initial teacher training. Without teachers in our classrooms who can spot the signs of dyslexia and teach in a way that does not alienate dyslexic children, we will continue to fail those children. I know from bitter experience that many teachers have a woefully inadequate knowledge of dyslexia. It was not until my son was nine that he came across a teacher who could spot what I now understand were glaringly obvious signs, and even then, that was probably because her own son had dyslexia as well, as I later found out. Too many children in their early years of school life are going through the motions without being noticed and supported. Like other communication difficulties, that can manifest itself in significant problems further down the line such as rebellious behaviour, depression or, as we find in our prisons and young offender institutions, criminality, which often starts as youth disorder.
The answer, in one word, is training. I understand that a module on dyslexia that has the backing of the sector has been prepared and is ready for incorporation in initial teacher training, but the Minister also indicated in her letter to me that the Department has commissioned new materials on specific learning difficulties, which will be available online in the spring. Will those materials form a mandatory part of the initial teacher training course, and will she consider the sector’s calls to incorporate the existing module from 2005 as a minimum requirement? She might be aware that the British Dyslexia Association has an online petition calling for the 2005 module to be used for teacher training; I think the BDA is seeking 100,000 signatures.
Kelvin Hopkins
My hon. Friend mentioned people in prison and people with personal difficulties in life. I am sure that she, like me, has come across youngsters with behavioural problems at school that can be traced back to self-esteem problems due to difficulties with spelling, which in their case is dyslexia. That stress can be relieved early on by saying, “You have a condition that we can help you to cope with. It is not something you should be ashamed of or behave badly over; it is something that we can help with and that many other people experience.” If we can convey that to young people, we can probably avoid a lot of the problems in life that many of them suffer.
Mrs Hodgson
My hon. Friend makes a good point. Early identification is vital. The earlier we can identify all special educational needs, not just dyslexia, the better, but we find that speech, language and communication disorders such as dyslexia often have the biggest effect on children’s self-esteem, and can often lead to problems such as youth disorder further down the line. The number of people in prison with speech, language and communication difficulties and dyslexia is anywhere from 60% to 80%. The noble Lord Ramsbotham is knowledgeable about the issue and speaks about it a lot. Much of the problem could be failure to diagnose special educational needs in our schools. We must ensure that children with a label get the right label, whether it involves dyslexia, behavioural problems, autism or whatever, rather than “naughty”, “lazy” or “disruptive”.
Kelvin Hopkins
To refer to my childhood, which was a long time ago, teachers regularly used to beat us on the back of the hand with rulers in those days. I was not beaten, because I was not dyslexic and was good at sums, but lots of my classmates were, simply because they had those sorts of problem.
Mrs Hodgson
That is a world we never want to go back to. Thankfully, that does not happen in our classrooms now, but what happens is that codes of conduct are given out. I saw it with my own son. He did not write down enough work from the board, so he came home with various punishments. The code of conduct was writing out the school rules. I got off the train from London one evening and walked into the house at 11 o’clock to find him still at the kitchen table writing out his punishment, the school rules. The punishment was given because the teacher thought he had not done enough work.
My son was 14 and had started at a new secondary school when we moved. I insisted that all the teachers at least knew that he was dyslexic. I was not asking for special treatment, just that they knew he was severely dyslexic and was statemented. I was assured that they would all be told. As I walked in and saw the punishment, I thought, “Either this is a very evil teacher, or he doesn’t realise my son is severely dyslexic.” I wrote a note to the teacher saying, “This is as far as my son got. I am stopping this punishment now. He is not going to do any more of these punishments. They must be proportionate to his ability.” It was like a child who came last in a sprint being forced to run a marathon. That was the equivalent of the punishment that he had been given.
A note came back the next day: “Very sorry, Mrs Hodgson, we had no idea your child was dyslexic.” That was unbelievable on many levels. The school was supposed to have told all his teachers that he had dyslexia, and it was obvious to anybody who knows anything about the condition that my son is dyslexic. That had not been picked up in him—a child in a new school. What if he had not been diagnosed in a previous school? At any stage in a child’s journey through school, teachers should be able to diagnose such disorders.
I know that we have plenty of time, but I will go back to the substance of my speech. The latest issue to present itself is the phonics screening that will now be required during children’s first years at school. I was more than a little annoyed to see in a departmental press release over the weekend that the Minister’s colleague, the Minister of State, Department for Education, the hon. Member for Bognor Regis and Littlehampton (Mr Gibb), referred to the fact that one in 10 11-year-olds could read no better than a seven-year-old as evidence that his favoured phonics scheme is needed, without mentioning that one in 10 11-year-olds have dyslexia.
Strangely, the same press release did not mention that two thirds of teachers who took part in the pilot disagreed that the check accurately assessed the decoding ability of pupils with special educational needs. That is why there are so many concerns about complete reliance on phonics as both a measure of ability and a teaching method. It is also crucial that children who fail the phonics test, as a dyslexic child almost certainly will, are not made to feel as though they have failed—although the test can be good, from the point of view that it identifies them. Appropriate remedial action, including testing for dyslexia, should be taken in a timely manner.
That brings me to the Government’s plans for the future of SEN provision, and the ability of those who will be expected to deliver it to do so. The Minister knows that I welcomed the Green Paper as a means of opening debate on SEN provision, and that I look forward to seeing the results of the consultation, as I know we all do. However, the concern throughout the sector is that young people with non-medical problems such as dyslexia might not warrant support when school action and school action plus are abolished, as very few dyslexic children are currently statemented. I sincerely hope that that will not be the case. I will welcome any assurance that the Minister can give us.
We then come to how support will be provided if a dyslexic pupil is deemed to need it. Local authority budgets are being stretched to breaking point right now. The proliferation of the academies and free schools desired by the Secretary of State will mean that few funds will be held centrally with which to sustain shared support services. I know that I have asked the Minister this before, but I hope that she will guarantee today that support for dyslexic students will not get worse before it gets better due to the austerity programme being imposed on local authorities, and that when the new system is fully up and running, the money will be there to back it.
I move to the end of students’ time in school. The Minister will know that I have concerns about the key stage 4 curriculum and examinations. I will not labour the point about the E-bac, but needless to say, it has been installed as the gold standard set of qualifications, despite the fact that it will exclude almost all young people with dyslexia, as they are usually not taught foreign languages, whether modern or ancient, for obvious reasons. On assessment, Ofqual confirmed in a press release today that it is implementing the changes to GCSEs that the Government told it to make—scrapping modular examinations, which allow students to break up their learning into more manageable chunks and sit exams as they go along, when the subject is fresh in their minds. Instead, from next year students will be required to learn for two years—a bit like when we sat our O-levels—and commit all of that learning to paper in one go. That intensity will pose a challenge for many children with SEN, but especially dyslexics, given the memory problems I mentioned.
The support that young people with dyslexia need to be able even to sit their exams, let alone do well in them, is also under threat. The Minister will, I hope, have seen my latest letter to her in which I drew her attention to an article by Jack Grimston in The Sunday Times on 20 November. He reports the concerns that school teachers have over the changes that the Joint Council for Qualifications has made to eligibility for access arrangements in examinations, which my hon. Friend the Member for Luton North highlighted.
The changes will prevent bright pupils with dyslexia from getting extra time or a reader and a scribe in exams to mitigate their limited reading and writing abilities, which gives them a level playing field with their non-dyslexic peers. That will have a detrimental effect on the qualifications that they will be able to achieve. There are many bright pupils with dyslexia, as we have heard today, some of whom go on to doctorates in physics. They say that Einstein was dyslexic, and I could list many other examples.
In a timed exam, the most intelligent young person is only ever as good as their ability to read the questions set and transfer the answers from their minds to the paper, which is why the most severely dyslexic pupil is given a reader and a scribe. In making the changes, the JCQ is limiting what intelligent dyslexics can achieve, and from my conversations with the sector, it appears to have done so without any consultation. I urge the Minister to look into the matter and intervene where necessary to ensure that such young people are not held back by their disability.
Finally, I understand from today’s Ofqual announcement that once the exams have been sat, dyslexics will be at a disadvantage yet again during marking, because the proportion of marks for spelling, punctuation and grammar in certain subjects is being increased following interventions from the Secretary of State. Even if a dyslexic pupil gets a reader and a scribe, whose spelling is the examiner marking?
Kelvin Hopkins
I am sorry to intervene once again on my hon. Friend’s excellent speech. The points she raises suggest that dyslexic pupils should be identified and the fact that a pupil is dyslexic recorded on the examination paper, so that allowances are made. I heard only today of a young woman who is highly intelligent in conversation and can come top of her class in most things, but has difficulty with writing due to her dyslexia. Every time she is tested orally, she does brilliantly, but when she is tested in writing, she has more difficulty.
Mrs Hodgson
I hope that the Minister will take up those other concerns with the JCQ and that compensations can be made in marking. We do not ask for favourable treatment for dyslexics, but for their disability to be recognised and accommodations made, so that there is a level playing field.
I have not set out to make political points today because the debate has been well informed and constructive, and I know that supporting young people with dyslexia is important to Members on both sides of both Houses. I sincerely hope that the Minister will commit to returning with her officials to look at the specific concerns raised today, and that she will take any necessary steps to mitigate, or indeed undo, the impact of what are the, I hope, unintended consequences that the various reforms and changes may have on the education and life chances of the estimated 750,000 young people in our schools and colleges who have dyslexia.
Mr Mike Weir (in the Chair)
Order. Although we are into the winding-up speeches and it is rather unusual, if neither of the Front-Bench spokeswomen object, I will allow a contribution from Miss Mordaunt.
Penny Mordaunt (Portsmouth North) (Con)
Thank you, Mr Weir. I congratulate the hon. Member for Luton North (Kelvin Hopkins) on securing this important debate. I have a ten-minute rule Bill, which is barely alive, on special educational needs, with particular focus on dyslexia and pragmatic language disorders. I thank both Front-Bench spokeswomen for allowing me to say a few words. I apologise for being late; I have been in a Committee.
My Bill was motivated by the enormous amount of casework in my constituency. There are very sad cases of extremely large numbers of children who have low to medium educational needs that are not being met by the local authority. I was dealing with about 30 cases, including a young lad with a very mild disability; he has had no assessment yet, so no one really knows what his needs are. He is supposed to be taking his GCSE options next year, but he has never been to a secondary school because a suitable place is not on offer. People do not understand what his issues are and there is no funding for a travel grant, which might open up some options for him. There are large numbers of extreme cases.
My Bill suggests that, common to all the cases I am dealing with, a wider burden of proof for parents to be able to demonstrate that their child has SEN would be extremely helpful. The old statement route catered for people with medium to high need, but did not help to provide leverage for parents whose children had lesser needs. In one case, a young girl with a reading age four years below her age was not considered to be significantly falling behind. If parents have paid for, or got a charity to make, an independent assessment from a qualified assessor, that should be enough to require the local authority to take action.
Teacher training has been mentioned, but training for those in local education authorities is also important. Part of our frustration in getting cases resolved was due to people not understanding what CReSTeD—Council for the Registration of Schools Teaching Dyslexic Pupils—accreditation was, or what the different levels meant for a particular individual. We were not really dealing with educationalists, which was partly due to staffing problems at the local education authority, so I echo the comments of the hon. Member for Washington and Sunderland West (Mrs Hodgson). Training should be extended to the LEA.
The local education authority should already be required to publish what provision is available in its area, but many do not, yet such a requirement would help parents tremendously. When the LEA has decided that a need will be catered for under school action plus, it should send the parents a quality letter, not simply one that tells them that the need will be covered in school action plus, so they should not worry. They should get detailed information about what that will mean for their child week by week.
Kelvin Hopkins
I congratulate the hon. Lady on her ten-minute rule Bill. I hope that it moves to the next stage and influences Government. She said that she wanted detailed letters from the local authority, which not only say, “Your child is falling behind and has a problem”, but identify the problem. There is sometimes an overlap between dyslexia, dyspraxia, low academic ability and other conditions that can confuse the diagnosis, but the local education authority should be able to define dyslexia when it writes the letters.
Penny Mordaunt
The hon. Gentleman is absolutely right. Getting an assessment to start with is a battle for parents, and then they must have confidence in it and in the remedial action that should be taken. Many parents I have been dealing with have not had satisfaction on any of those fronts.
I would be grateful if the Minister could say more about the statutory responsibilities of the Department for Education and the discussions she may have had with the Department of Health. We need to strengthen the tools available to parents and other advocates for these children. My constituents certainly believe that they pay their taxes to ensure that the education system we provide gives every child the education they need to reach their full potential.
One of my final points relates to costs. Where we have not been able to get a school place for some of the children in my constituency, we have actually funded placements for them, and I should like to place on record my thanks to a number of London livery companies and local Rotarians for providing funds to allow that to happen. In just one year, the girl I mentioned at the start, who was four years behind her expected reading age, has caught up. She is a bright girl, and having been given the proper, full-time dyslexia teaching that she needed, she is now doing really well.
An argument that is often thrown back at us is that providing all the top-notch SEN provision that children need costs too much and that the state cannot possibly afford it, but that is a bit of a myth. The placement that we have funded for the child I mentioned cost less than the provision that the local authority would have had to put in place in the school that it chose for her. It is possible to do these things, and they will often save the state money not only initially, but, as has been mentioned, in the long term, given all the problems and issues that people have if they do not get the help that they need.
Mrs Hodgson
The hon. Lady is making some important points, and she makes a good point about spending money wisely. Research has been done—I do not have it in front of me, but that is not necessary to make my point—showing that an hour with a specialist dyslexia teacher is worth more than 50 hours with a well-meaning teaching assistant who is not able to give the specific support that a child needs. I might have the ratio wrong, but it is in that realm.
Penny Mordaunt
That is absolutely right.
To carry on using the example of the girl I mentioned—I have said this to the Minister before—the problem was not so much that the local authority could not be bothered to find her a suitable place as that the restrictions on how it could use its funding meant that it could not fund some of the obvious solutions. Will the Minister therefore say something about how she might reform the rules governing how local authorities and schools can spend particular pots of money, to ensure that we use that money in the best and most sensible way to meet people’s educational needs, whether they have dyslexia, a pragmatic language disorder or autism? We must ensure that we get every child who needs this provision the help that they need.
The Minister of State, Department for Education (Sarah Teather)
It is a pleasure to serve under your chairmanship again, Mr Weir. It is a Wednesday afternoon; I am here in a debate that you are chairing; and I am very pleased to see you.
I congratulate the hon. Member for Luton North (Kelvin Hopkins) on securing the debate. It was good to see other Members come into the Chamber, although a bit late, because I was anxious that we would not have so many Members contributing. This issue interests Members right across the House, and I am aware of the hon. Gentleman’s involvement in the all-party group, whose input and advice I have very much welcomed.
I listened with interest to the rather technical debate between the hon. Members for Washington and Sunderland West (Mrs Hodgson) and for Blackley and Broughton (Graham Stringer). None us is a qualified educational psychologist, and it has certainly been an awfully long time since I did any neurophysiology. The Government take their advice from the best and latest scientific advice available. The Rose report tried to get away from the debate about the exact nature and cause of the difficulties that people face—something that was often distracting for many students—and instead tried to focus on solving the individual child’s problems, whatever they might be, as they present in the classroom. With that in mind, I will not get involved in the detail of that debate, because it might be better if it took place somewhere else between expert educational psychologists. Instead, I will deal rather more with service provision.
Dyslexia affects a significant number of pupils. From the school census, we know that 78,000 pupils receive support for a specific learning difficulty, including dyslexia and dyspraxia. They receive that support through school action plus or a statement of SEN educational needs. About 11% of all pupils receive such support. Many others will be supported as part of a personalised approach to teaching in the classroom, as a number of hon. Members mentioned. That will perhaps involve additional help from teachers or teaching assistants.
Dyslexia primarily affects the skills involved in accurate and fluent word spelling and reading, and it can occur across the range of pupils’ intellectual abilities. We know from parents and pupils that they are often frustrated with the assumptions made about what they can achieve, and the Opposition spokesperson, the hon. Member for Washington and Sunderland West, referred to the case of her son. Sometimes that can lead to incredible frustration and a stymieing of aspiration in individual students.
For far too long, there has been a real attainment gap between students with dyslexia and their peers. The proportion of pupils with a specific learning difficulty gaining the expected qualifications has more than doubled since 2006, but the gap remains far too large. In 2010, fewer than one in six such pupils, or just under 15%, achieved five GCSEs at grades A* to C, including English and maths, compared with more than half of pupils as whole. The Government are determined to see that change and to improve overall outcomes for pupils with SEN or a disability. Support for pupils with SEN is provided within a statutory framework that has, unfortunately, remained largely unchanged for three decades.
One of the first things that I did when I became a Minister was to begin a review of special educational needs. In March this year, I published our Green Paper, “Support and aspiration: A new approach to special educational needs and disability”, which sets out plans fundamentally to reform the special educational needs system. It was a response to a set of core problems that undermined the achievement of too many children and young people, and those problems have been mentioned by a number of hon. Members, including the hon. Member for Portsmouth North (Penny Mordaunt). The problems include parents having to battle through a confusing and adversarial system to get the support their child needs; SEN statements not joining provision up, with education, health and care often ending up being provided disparately, and families having to go between the three different providers to negotiate their own package of support; children falling between the gaps in services or having to undergo multiple assessments; and paperwork and bureaucracy adding to delays, rather than providing the support that is needed.
Kelvin Hopkins
The Minister is talking about delays. A number of members of my family have been schoolteachers, and getting statements has often been an enormous difficulty. Sometimes, it has taken up to a year before a child who clearly needed to be statemented actually was statemented. The suspicion is that local authorities are trying to delay things to save money. I hope the Minister will take that into account.
Sarah Teather
One thing that we suggested in the Green Paper was speeding up the process, but this is also a question of trying to make clear what the thresholds should be, and I will say a little more about that later.
The other thing that informed the Government’s work on the Green Paper was Ofsted’s report, which showed that too many children are being over-identified as having SEN. In other words, the wrong children are often labelled as having SEN, and we need to ensure that we put in place the right support for children at the right time.
At the heart of the Government’s vision for the reforms is a desire to support better life outcomes for young people, to increase parents’ confidence in the system and to transfer powers to the front line and local communities, as we are trying to do across all areas of policy. To achieve those changes, we are introducing a new approach to identifying SEN to challenge the culture of low expectations. There will be a new, single early-years setting and school-based category of SEN.
I heard the concerns of the hon. Member for Washington and Sunderland West, who was worried that it might lead to some young people not getting the support they need, but I should stress that, of course, school action at the moment brings with it no extra funds. School action plus money is provided to schools on the basis of other proxy indicators, rather than the number of children actually in the relevant category in previous years, so it should make no difference to the resources that are allocated. However, it will make it easier for schools to decide how to deal with the young people that they focus on. Many of them say that the existing categories are somewhat bureaucratic. Ofsted has made the point that some children are labelled as having special education needs when really they are just falling behind. That is a rather different debate from the one about specific learning difficulties.
Mrs Hodgson
We are looking for reassurance that when the reason for children falling behind is an underlying special educational need, rather than there being no specific reason, they will still be identified by some marker. They might not need the education, health and care plan, and all that it brings, but the marker would have been school action or school action plus. Will there still be some mechanism to identify those children?
I suppose the reason for giving the relevant marker to children who fall behind might be to try to find out whether there is an underlying reason.
Sarah Teather
When Ofsted reported, a rather heated debate took place between teaching unions and Ofsted, and it shed a lot of heat but not light. Many accusations were thrown from both sides about motives. I do not think that teachers label a child as having special educational needs to get round league tables or for similar reasons. It is human nature, when a problem is seen, to label it. Unfortunately, that labelling was often not followed by action. It is all very well to label a child, but it is purposeless to do so if no action follows. The child then carries a label with them, irrespective of whether it is helpful, and does not get the support needed to enable them to progress. We are trying to get away from the focus on labelling, and instead to adopt an approach in which those concerned look at the child in front of them, and ask what they need. Some of that approach, to be fair, is about good teaching practice, which will deal with many needs.
Kelvin Hopkins
The hon. Lady is right about dealing with individual children. Boys need more pressure and rigour in school, when they are young, than girls do. Girls tend to be more conscientious and are now succeeding in education. In every field and at every level they now beat boys. I agree that we need to consider teaching quality as well, so that youngsters do not fall behind because they are more interested in playing on the computer, or doing something not to do with their studies. Rigour in education is right for all youngsters. However, we also need to take account of those with specific difficulties.
Sarah Teather
All sorts of young people fall behind. The fact that so many young people born in the summer are in the school action category is particularly good evidence that we do not at the moment necessarily label the right children. Other children who may have specific needs go through school without being identified. That is not good enough, because such children do not get the support they need.
The Green Paper made some radical proposals to change the system. As several Members, including the hon. Member for Portsmouth North, said, we have just finished a consultation and will respond to it in the new year. The rest of what I say now on the matter will pick up on what we have already said, rather than announcing what we will do. Hon. Members will have to wait a few weeks, until we have finished crunching through the detail of the consultation. We had an enormous number of responses from parents, charities and teachers. That is very helpful detail and we need to work through it.
As I said during my introduction, many pupils with dyslexia receive most of their support in the classroom through high-quality, personalised teaching. We know from the independent review led by Sir Jim Rose that the early identification of problems and the right teaching support are critical to helping dyslexic pupils achieve. Alongside the special educational needs reforms we are also working with schools to support teachers to identify and respond to pupils with dyslexia. Difficulty with phonics and the ability to identify and manipulate the sound of words is central to the challenges that dyslexic pupils face. It is also a critical element for all children learning to read.
We are introducing a new phonics screening check for children in year 1, which should pick up children struggling with early literacy because of dyslexia. I think that the hon. Member for Washington and Sunderland West slightly misunderstood some things about the statement at the weekend by my colleague the schools Minister. When he highlighted the fact that inadequate numbers of young people were passing the screening test at the relevant stage, he was trying to make the point that phonics, as a system for teaching reading, had not properly embedded in teaching at the earliest stages of schooling. He was not labelling half of children as failing. He was recognising how much further we need to go to embed the practice clearly in the way teachers teach the youngest children to read, from the beginning. We know that phonics is particularly helpful for identifying difficulties in children who have dyslexia.
Graham Stringer
The Minister has been speaking an enormous amount of sense, recognising that teaching children to read is one of the most important things that the state does. I think she has recognised that Jim Rose recommended in his report that systematic phonics should be at the heart of good Government strategy for teaching children to read. When the Select Committee on Science and Technology considered the scientific basis for the Government’s policy, we found from the written and oral evidence that there was still, in the wave 3 reading recovery programme, a continuing practice of word memorisation and the use of whole language theory. That does exactly the opposite of what the Minister has been saying about recognising phonics and the transferability of the sound and the letter. Has she had a look at what is happening in wave 3 reading recovery?
Sarah Teather
I certainly looked at the reading recovery programme, Every Child a Reader, most of which is based around phonics. There are some other, more flexible, practices. We must recognise that although the evidence suggests that systematic phonics is absolutely the most effective way to teach children to read, some children for various reasons will not respond to that system, and it is important to have some flexibility at the margins to pick up the children who have fallen through the net. However, almost all the programme is still based around systematic phonics.
Kelvin Hopkins
I agree with the Minister and my hon. Friend about phonics for those who do not have the disabilities in question. Two generations of teachers have almost been forbidden phonics in schools. Even in the past year I have come across a teacher working in London who was forbidden to make any reference to phonics in school. We still have a serious problem.
Sarah Teather
To support the teaching of systematic synthetic phonics we are making £3,000 of match funding available to all schools with key stage 1 pupils, for phonics materials and training. I hope that that sort of systematic, structured approach to teaching phonics will help, because we know that it supports pupils’ approach to learning to read, particularly for those who are dyslexic.
I want to make some wider comments about support for teachers and work force development, which goes to the heart of our programme on SEN. It begins with the new standards for qualified teacher status, which include a continued focus on meeting the needs of all children, including those with special educational needs or who are disabled. Similarly, as part of the national scholarship programme for teachers, we have a clear focus on supporting teachers to improve and extend their knowledge and expertise when working with pupils with special educational needs and disability, including specific impairments.
It is anticipated that around 50% of those scholarships will be available to support SEND. We have provided funding for up to 9,000 special educational needs co-ordinators to complete the mandatory higher level SENCO award by the end of 2011-12. The Teaching Schools network, which will allow schools to support each other and drive up the quality of teaching, will help to improve the quality of support for pupils with special educational needs or a disability. Of the first 121 designated schools, 113 have been judged as outstanding for the quality of learning and progress of pupils with special educational needs. The new Teaching Schools initiative has real potential to radically improve the quality of peer-to-peer mentoring and support for teachers in relation to SEN.
Penny Mordaunt
On support, one of the other problems that I encountered in Portsmouth was that, where a child had not got a school place and the parents were trying to do their best to teach them at home, they received no support, because if they admitted to the local authority that they were teaching the child at home, they were instantly crossed off the waiting list for a school place. I would be interested to know whether the Minister has any views about how such training and support could be extended to provide parents whose children are at home waiting for a school place with the support and help that they need to ensure that they are not missing out.
Sarah Teather
I cannot comment on a specific case, but perhaps if the hon. Lady drops me a note about the matter, I will have a look at it. In the Green Paper, we indicated that local authorities need to provide support to families who are home schooling a child. They are often doing so because they have been unable to get the support that they need in mainstream settings or perhaps because their local special school did not provide them with the support that they wanted.
I want to say something about Achievement for All because it goes to the heart of some of the issues that we have been discussing about the need for someone to look at the child in front of them and have high aspirations, rather than necessarily think about the labels. The Achievement for All programme has been running in around 450 schools for the past two years, and the evaluation has demonstrated some dramatic results. Under the programme, children made greater progress in English and mathematics than other children with SEND across the country, and they also often exceeded the progress of children without SEND, so there has been a really dramatic improvement.
The independent evaluation, which was carried out by the university of Manchester, demonstrated that pupil attendance significantly improved. That picks up some of the other points that we were discussing a moment ago about additional needs sometimes being confused with SEN. Often the issue is just about getting young people to attend school. For children taking part in the Achievement for All programme, there was an average increase in attendance of just over 10%. The evaluation also found significant improvements in behaviour, including less bullying, stronger relationships between schools and parents and a greater awareness and focus on SEND.
Some of the points that the hon. Member for Portsmouth North discussed in relation to her Bill—parental engagement and the need to communicate better with parents—go partly at the heart of this. One of the key facets of the Achievement for All programme is parental engagement and enabling teachers to feel confident about having a conversation with parents about the progress of their child. The Government are investing £14 million to roll out the programme across the country, so that more children can benefit. The programme is being delivered by a newly formed charity, Achievement for All 3As, chaired by Brian Lamb and supported by PricewaterhouseCoopers. Schools can now see for themselves the evidence that the programme works, and we want more schools to come forward and sign up.
The evaluation highlighted some important lessons in how to improve the outcomes for pupils with SEND. Perhaps most crucially, there needs to be strong leadership from the head teacher and senior leadership team, rather than simply relying on a SENCO to provide leadership within a school, although that is important. Achievement for All 3As is currently engaged with 41 local authorities and 598 schools. We hope and estimate that, overall, 1,000 schools will have signed up to the programme by April next year.
I want to turn to some of the specific concerns, particularly on the Joint Council for Qualifications guidance, expressed by hon. Members. I understand that there has been significant concern following recent coverage about apparent changes to the availability of reasonable adjustments for dyslexic pupils. It is, of course, absolutely vital for the fairness of an exam system that reasonable adjustments are made where needed. We have therefore been in touch with the JCQ about the changes, and it maintains that there has been no change to the circumstances in which a student is entitled to extra time for an exam. What has changed is the type of evidence that is acceptable to demonstrate that such extra time is needed.
The most recent edition of the relevant guidance confirms that a school or college must consider and maintain on record the evidence that the student has been assessed as having a below-average standardised score in an assessment of processing, reading or writing speed. I emphasise that the previous guidance similarly required evidence of low standardised scores using assessments of processing speed, reading or writing. I am afraid that we are picking up differences in practice, not differences in the guidance. Such difficulties have always been the basis on which extra time can be awarded to dyslexic pupils, and difficulties in phonological awareness—understanding and decoding the sounds of words and verbal processing—were two of the characteristics of dyslexia identified by Sir Jim Rose.
I understand that Dyslexia Action has written directly to the JCQ to set out its concerns. It is right that the JCQ and Ofqual, as the independent body overseeing the examinations system, should respond to those and determine whether any further clarification of the arrangements is required. I understand that they will be meeting with dyslexia charities and experts in the new year to explore those differences further. Ofqual has assured me that pupils already granted extra time will remain entitled to it on the basis of their existing assessment. I hope that hon. Members will be reassured on that point.
Mrs Hodgson
On a point of clarity about the difference between the old and the new criteria, is it the case that, under the old criteria, students had to have a low score and that now it has to be below average? I am not sure whether I heard the Minister correctly.
Sarah Teather
There is no change in the criteria; there is a change in the evidence that has to be provided. What we are picking up on is how schools interpreted the previous guidance, not necessarily the actual guidance that was being provided. That raises some issues about how schools were interpreting the guidance and the freedom that they thought that it gave them. In fact, the guidance is the same, but slightly more rigorous evidence is being asked for to demonstrate that schools have met the guidance, and they are being asked to hold that on record. The best thing is for Ofqual and the JCQ to meet dyslexia charities in the new year, as they will do, along with other experts in the area. They should make those points to the JCQ and Ofqual at that stage.
The hon. Lady spoke briefly about the changes to spelling, punctuation and grammar in some GCSEs that were announced this afternoon. Hon. Members may be aware that that was likely to happen and that we would be restoring marks for spelling, punctuation and grammar in some key subjects that have extended pieces of writing. During Ofqual’s consultation on the proposals, it heard concerns from dyslexia organisations about the potential impact on pupils with special educational needs, particularly dyslexia. I understand that it will be considering that as it decides how to roll out and implement the proposal.
However, during the consultation, there was also widespread support for ensuring accuracy within the qualifications. People expect those with high grades in GCSEs to be able to write accurately. The need to include an assessment of accuracy in spelling, punctuation and grammar is key to restoring confidence in GCSEs as rigorous and valued qualifications. Ofqual has set the level at 5% of total marks for the GCSE, so that the assessment of subject knowledge is not affected disproportionately. There will be the possibility of partial marks. It is not an all-or-nothing assessment and students will be able to achieve some or all of the marks depending on the extent of accuracy and how well they have conveyed meaning. In practice, there will be no blanket effect on the grades achieved by individuals, and the credibility of the exam and the grades achieved will be increased for all. Such changes, alongside some of the reforms to special educational needs provision, will give a real incentive to teach all pupils those core skills and prevent pupils with special educational needs from being sidelined or aspirations being lowered.
Kelvin Hopkins
I recently chaired a meeting of the all-party parliamentary group for social science and policy, at which we considered and had academic presentations on social mobility. A major factor in poor social mobility is the gulf in the use of language and education. Is the Minister saying that for the great mass of pupils, we will ensure that the standard at which they are able to use the language formally will be targeted and improved, or just that we will have a race to the top where the middle class will again have the advantage?
Sarah Teather
I agreed with the hon. Gentleman’s first point. The second point seemed to bear no resemblance to the first. To raise aspirations for all is a good thing. To say that it is possible to achieve, regardless of background, is really important. To believe in social mobility and have it at the heart of educational policy, we have to have high aspirations for every child.
Kelvin Hopkins
To clarify, if one just gives marks for punctuation, grammar and syntax, certain people from certain backgrounds will have an even greater advantage over people from other backgrounds. The gulf in our society will widen unless extra effort is put in to ensure that everyone has a rigorous education in these methods.
Sarah Teather
I really do not accept that point at all. It is simply not good enough to say that, because someone is from a certain background, they will not be able to learn how to spell or use language correctly. That is exactly at the heart of what we are trying to break. I have to say that, as an employer, I meet lots of graduates who do not have dyslexia who have not learnt how to use accurate punctuation and spelling. Unfortunately, it is a continuous frustration, and I sometimes wonder whether I am the best-paid proofreader in the country, given the amount of time I spend correcting grammar and punctuation in the documents that leave the Department—I probably should not say that in Hansard.
Kelvin Hopkins
I agree entirely. The Minister’s experience and mine are the same, but those who had the rigorous experience that I had at school have an advantage over those who did not, even though they might have been equal in ability in every other way. I appreciate that we are off the subject of dyslexia now. We are running out of time; but it is important to say that, if we are to have a society that is less divided, we must ensure that we provide education for those who do not have natural advantages.
Sarah Teather
If we are to have a society that is less divided, we must ensure that all children, regardless of their background, are given the same benefits of that sound education. Putting those marks, even 5%, back into qualifications will create an incentive to ensure that all children have that grounding. That is really important.
Mrs Hodgson
To return to the subject of dyslexia and the dispensation that will be given for children with dyslexia, the additional 5% can make the difference between an A and an A* for a very bright, dyslexic pupil.
Sarah Teather
Ofqual will consider and take into account the concerns of dyslexic charities when it decides on implementation. The issue of reasonable adjustments continues to remain.
I should like to conclude now. I thought that we would not have many speakers. In fact, I seem to have prattled on for so long—[Interruption.] Are there 17 minutes left? I thought that we finished at 3.45 pm. I have been racing to the end and thought that I only had two minutes. In fact, we have loads of time. I might still conclude anyway, or I will not have any voice left.
I am very grateful to hon. Members for their contributions. I hope that I have been able to allay some concerns. Dyslexia charities will no doubt make the points that they made to the hon. Members who came to this debate to Ofqual and JCQ in the new year, but I want to leave hon. Members with the assurance that we are absolutely committed to reforming the support for children with special educational needs and disability. We will say much more in the new year, in response to the consultation. I am grateful to all hon. Members for their constructive input on this matter.
Farepak
(13 years ago)
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Jessica Morden (Newport East) (Lab)
Although I am happy to have secured this debate, I am extremely unhappy that I felt compelled to apply for it. I had hoped that justice would have been done by now, and that Farepak customers and agents would have received at least some of their money back. However, five years from Farepak’s collapse, customers have not received a penny of the compensation due to them, and have not seen justice done. Those responsible have not been held to account. To add insult to injury, on the fifth anniversary of Farepak’s collapse, we have learned that not only has none of the £5.53 million compensation been paid, but the administrators, BDO, have admitted that the cost to date of winding up the company comes in at £8.2 million, which is far more than the compensation owed.
Tony Cunningham (Workington) (Lab)
Is it worth reminding people that the company knew when it took money from people that it was not able to provide the goods and services required, and that the people it defrauded could least afford to lose that money?
Jessica Morden
I thank my hon. Friend for his intervention. He makes an incredibly valid point. The people involved had modest incomes, and could least afford to lose that money. They ended up paying twice for Christmas, or borrowing money. The whole matter was a scandal, and we are still no clearer about when it will be resolved. Farepak victims were ripped off twice: once when the company collapsed, and secondly by an establishment that has not protected them.
The history of Farepak’s collapse is well documented, and has been the subject of debates in the House, often initiated by Anne Snelgrove, the former Member for Swindon South, whom I applaud for her unstinting work in standing up for Farepak customers and employees. As this is only a half-hour debate, I will not rehearse the history, except to say that Farepak went bust on 13 October 2006, and the result was that the Christmas savings of around 120,000 people, in total about £38 million, were apparently lost. The money seemed to have been siphoned off to help to combat the debts of the parent company, European Home Retail but as my hon. Friend said, Farepak continued to collect money even when it knew that it had problems.
My inspiration for the debate is my constituent Deborah Harvey, who was a Farepak agent. The word tenacious does not come anywhere near doing her justice. Deb was an agent in Alway in Newport, and encouraged eight friends to spread the cost of Christmas by saving with Farepak with her. Like many agents, she was not motivated by self-interest; she was driven by wanting to see justice for the friends who saved with her because they knew her. They are owed a total of £2,100, and if they ever recoup any money, they will probably receive just £315.
Katy Clark (North Ayrshire and Arran) (Lab)
My constituent, Jean McLardy, has given me a Farepak customer payment card that belonged to her mother, who has passed away. It looks identical to those of credit union savings schemes, and it is clear that the people who put money away every week thought it was in a savings club.
Jessica Morden
I thank my hon. Friend for her intervention. She made her incredibly valuable point very well. She has done sterling work on the Farepak issue over the years, and I commend her for that.
My Farepak savers in Alway will probably receive a total of about £315. I acknowledge the organisers of the unfairpak website who keep the campaign going and are a source of information for Farepak victims in a sometimes unclear process.
Where are we, five years on? Have the directors of Farepak been brought to book? No. The Government, through the Insolvency Service, have finally applied to the courts to disqualify Sir Clive Thompson and eight other directors associated with the collapse of Farepak. Does the Minister not believe that the length of time that the directors have had to appeal while still holding office is incredible when innocent victims wait and wait? Perhaps he will tell us how long the Government expect the case to last? As a Farepak agent told me the other day, if she had stolen something, she would have to pay for what she had done wrong, and it would not take five years.
Tony Cunningham
Let us be honest. If someone broke into a house and stole such an amount of money, they would find themselves in prison. They would be jailed, never mind paying compensation, or justice. They would find themselves in prison, and that is where they should be.
Jessica Morden
I thank my hon. Friend for his intervention, which was well made. Many victims have called for Sir Clive Thompson to have his knighthood removed if he loses the case, and perhaps the Minister will also address that point.
A survey posted on Twitter and the Farepak victims committee Facebook page reveals what Farepak victims think: 95% of the respondents thought that the liquidators had taken too long, and should have finished by now; 79% did not think that there are enough regulations to protect consumers from anything like the Farepak collapse happening again and 95% thought that all Christmas savings schemes should be tightly regulated. Many Farepak customers are upset about how the administrators, BDO, have handled the liquidation process. BDO struck an agreement with some of the ex-directors of Farepak to pay a total of £4 million in compensation, which is about 15p per pound owed. Not only are Farepak victims angry, as they should be, at receiving only 15p in the pound, they find it deeply unfair that as part of the deal the directors accept no liability for Farepak going bust. Will the Minister say whether that is common practice?
I am aware that some agents and customers received some money back in 2009 under a court order. That was a repayment to customers who had made payments as the company collapsed and which Farepak tried to put into trust accounts. Customers received some compensation from a response fund just after the company went bust, but as yet no customer has received any money via the administrators. BDO will argue that the reason is that it is still chasing, and that it is standard practice for administrators not to pay out any dividend until all avenues have been exhausted. However, as widely reported in the news last month, BDO has so far cost in excess of £8.2 million, which includes, for example, £50,000 for public relations work. That is an eye-watering sum, especially when BDO has managed to obtain only £5.5 million back for the victims. So far, the process hardly seems fair.
I understand that there is a possibility that ex-customers could receive less than 15p in the pound. If the administrators fail to recoup any more money from ongoing operations, they will take their costs from the moneys already recouped. I accept that the ongoing actions, if successful, could result in ex-customers receiving more money, but either way the administrators will accrue more and more costs, making customers even more resentful.
Susan Elan Jones (Clwyd South) (Lab)
I am grateful to my hon. Friend for securing this important debate. Does she agree that some of the practices that she describes are at best ethically questionable and, looking at them more strategically in terms of how victims have been affected, downright wrong?
Jessica Morden
I thank my hon. Friend for her intervention. I agree that the matter is downright wrong, and I hope that the Government will act.
I would like the Minister to say whether he believes that the insolvency process is fit for purpose in dealing with the aftermath of cases such as Farepak. Should there not be a limit on how much administrators can demand—perhaps a percentage of the total amount accrued? I have spoken to Farepak victims and agents, and the process is incomprehensible from the outside. Victims need to know what is going on, and why it is taking so long.
Mr Robert Buckland (South Swindon) (Con)
I am pleased that the hon. Lady secured this debate and that she raised the point about transparency, because there are real concerns about creditors’ representation, and precisely what is going on with BDO. There is a dearth of information, and it is not good enough to rely on civil proceedings as a cloak to prevent victims from being told what is going on.
Jessica Morden
The hon. Gentleman is exactly right. Although my constituent has been incredibly tenacious, from her point of view it has been very difficult to get any information out of the administrators, apart from messages posted on the website.
The average amount of time taken for a liquidation process to finish is about two and a half years, so we can completely understand the sheer anger, frustration and, frankly, scepticism of the ex-customers of Farepak over the administrator BDO and its motives. Could this ever happen again? Following the collapse of Farepak, the Christmas Prepayment Association was set up. On the face of it, the guidelines issued by the CPA seem to remedy many of the issues that arose. However, the association has a major flaw: it is self-regulating. Conceivably, a Christmas hamper company could be set up tomorrow and not be required to follow the CPA guidelines. This is surely not acceptable, given what has happened.
Mr Buckland
The hon. Lady has come to the fundamental point. Five years ago, a loophole was identified. Because of the nature of the business, unbeknown to all the clients and customers who took part in it, it is not in law a financial service. Why is that loophole still there five long years on?
Jessica Morden
I thank the hon. Gentleman for that intervention. He goes precisely to the crux of the issue: self-regulation is simply not acceptable. We need statutory guidance. We must compel companies to protect their customers’ money. Can the Minister assure us that the Government will do that? If not, can he explain the reasons why, especially as just today we have seen that banks are to be compelled to display prominent signs telling customers that their savings are protected up to £85,000. What should we do in this case?
Katy Clark
Does my hon. Friend agree that one of the problems highlighted is that the victims have been treated as unsecured creditors, so they are right at the bottom of the pile? The Office of Fair Trading report, which was published in December 2006 after Farepak collapsed, highlighted the problems with prepayments for funerals, holidays and mail order, but this case goes way beyond that. Has my hon. Friend had an opportunity to look at the scale of the problem?
Jessica Morden
My hon. Friend is exactly right. There are a whole range of prepayment schemes. She mentioned prepayment for funerals, which is a huge issue that I shall address later.
Farepak customers were on modest incomes, and in October 2006 their Christmas was destroyed. All their carefully saved money disappeared overnight. These are people who did the right thing. They planned how they were going to pay for Christmas, they worked hard all year round, they made their monthly payments and Christmas was going to be sorted. They are predominantly women managing household finances to provide for their families. They were doing what we ask people to do. When Farepak went bust, Christmas was ruined for many. They were on modest incomes and could not get money out of the bank to cover the loss.
The Government owe it to Farepak victims to do the right thing. Farepak is a special case and the Government should step in and help. We did it for Equitable Life victims; quite rightly, the Government are stepping in to the tune of £500 million for them this year. Farepak victims are owed around £38 million. In the same way as we did with the banks, we should send the right signal to savers on modest incomes that their money is safe in the event of bankruptcy.
Sir Alan Beith (Berwick-upon-Tweed) (LD)
I commend the hon. Lady for securing the debate. It is important that people are very careful about putting their money in schemes of this kind after the experience of Farepak. Before putting in their money, they should look for firm guarantees such as the banks must now have. Money is precious when it is from a hard-earned small income.
Jessica Morden
I thank the right hon. Gentleman for that intervention. Obviously, that is where the CPA and self-regulation come in. Many of the Farepak victims that I have spoken to saved with friends because they trusted them. We must address the whole issue in the industry.
Despite all that has happened to her and her friends, the priority of my constituent, Mrs Deborah Harvey, is to ensure that the situation never happens again. On behalf of her and many others, I say to the Minister that Farepak victims want justice, adequate compensation, enhanced regulation for all firms engaged in prepayment schemes, and key figures in Farepak to be held accountable for what they did. That is how we shall ensure that decent people doing the right thing never again lose out in that way.
The Minister for Further Education, Skills and Lifelong Learning (Mr John Hayes)
It is a great pleasure to be able to respond to this debate, Mr Weir, and I am grateful to the hon. Member for Newport East (Jessica Morden) for bringing the matter to our attention. It is a matter of profound concern to the people involved. I think I reflect the Government’s perspective in adding my view that this was completely unacceptable. Many vulnerable people were associated with it and it has taken far too long to sort out. The steps taken to try to resolve it were far slower than both the people detrimentally affected and any reasonable observer might have anticipated, so I am extremely sympathetic to the case that the hon. Lady has made and to the circumstances of the people who were so badly affected. It is understandable that questions of the kind that she has posed are raised when so many people are affected. The insolvency is particularly sad, coming around a savings scheme—a club, if you like—that was tied to Christmas, as we now approach Christmas some years later. This is a poignant subject, and the emotions evident in the contributions made so far reflect the character of the matter with which we are dealing.
Tony Cunningham
Does the Minister accept that what makes the situation even worse—it is bad enough that it is Christmas and so on—is that the agents who were taking the money week after week were taking it from friends? The responsibility and the guilt that they feel, because they have let down their friends, are enormous.
Mr Hayes
Yes, that is true. It is a good point. The hon. Gentleman made that point in an earlier intervention in a different form, and he is right. We think of the victims as the people whose money was contributed and lost, but the wider effect of the kind he described is also very sad, because people were acting in good faith, unaware of the likely consequences of the role that they played until it was too late to do anything about it. The hon. Gentleman is right to identify the communal effect that it had on communities that are often tight-knit and where trust matters. This is a poignant matter that understandably stimulates heartfelt sentiments. I will try to deal factually with the circumstances, but it is hard to do that in the context, about which we feel deeply.
The matter started before we came to office, but it is not a partisan matter. Governments need to express a view and take appropriate action. The case began under the previous Government and, of course, because it has not yet been satisfactorily drawn to a conclusion in terms of the money received by the people concerned, it continues under this Government. However, neither Government could have intervened in the conduct of a particular insolvency, as that remains subject, as hon. Members will know, to the overall supervision of the court. Nevertheless, I can give some background as to where the Government stand at the moment.
On the issue that was raised about the directors, concern was rightly expressed about their position and their living up to their responsibilities. They are the people who controlled the company. The investigation that took place was complex. As the hon. Member for Newport East mentioned, it resulted in an application by the Business Secretary, in the High Court of Justice on 26 January this year, for disqualification orders to be made against the directors. It was made in the public interest on the ground that the conduct of each director makes him or her unfit to be concerned in the management of a company. It is, of course, a legal application. None the less, the fact that we made it reflects the Government’s view that this is a matter of profound concern. The individuals must be held responsible. As a result, opportunities to serve in a similar or indeed any business capacity should be limited. To say more about that at this stage would probably be improper, but the message that I have broadcast makes clear my views and those of the Government.
Jessica Morden
Does the Minister have any idea how long the process will take, and will he address the issue of the knighthood if the person in question is found guilty?
Mr Hayes
That is a fair question, but since the matter is now part of a legal process it is difficult for me to give a definitive answer. It would not, however, be unreasonable for my hon. Friend the Member for Kingston and Surbiton (Mr Davey), who is the Minister responsible for such matters, to respond directly to the hon. Lady, and I will ask him to do just that. I am not the Minister responsible for this particular matter, although I am happy to act as a conduit to the person who is. On such occasions when I am standing in for a Minister, it is my habit to make it clear to them that they have a responsibility to hon. Members and to the Chamber. I am more than happy to pass on the fact that I would like my hon. Friend the Member for Kingston and Surbiton, in so far as he can, to answer that question.
Mr Buckland
In the spirit of that constructive approach, may I ask the Minister the question posited by the hon. Member for Workington (Tony Cunningham) about the criminal aspect of this case? Was a proper investigation ever carried out by the Serious Fraud Office or the Crown Prosecution Service into allegations of fraudulent trading? It certainly seems to me, and to many others, that that should have been looked into at the time. If it was not looked into, why was that?
Mr Hayes
I will try to deal in my remarks with some of the actions that were taken, and if I do not cover that point I will come back to my hon. Friend on the matter. I would like to make some progress to describe what actions have been taken, although I am mindful of that intervention and do not seek to avoid it. I will try to deal with it during my remarks, but if I cannot, I will subsequently reply to my hon. Friend directly.
Nick Smith
It is great that the Minister has shown such sympathy for the victims of this injustice. Such schemes take place up and down the valleys in south Wales, and many members of my family have participated in them in the past. I would like to press the Minister on the matter of alleged fraud. Will he let us know what he is going to say on the matter sooner rather than later, so that we can quiz him further? People are very angry.
Mr Hayes
When I have made some progress, if I have not satisfactorily covered that matter I give a commitment that either I or the Minister responsible will respond properly and as far as we can within the legal constraints that I have set out. I am aware of the hon. Members who have participated in this debate, and of those who have a particular interest in the area. I am not avoiding the issue; it is a fair question and I will ensure that it gets a fair answer from the Government. I am not in the business of avoiding difficult subjects, particularly ones such as this that unite the whole House in its view of what is and is not appropriate.
In the short time that we have available for this important debate, let me make some progress so that I can deal with some of the points raised. I want to set out the steps that we have taken to avoid such things happening in the future. As the hon. Member for Newport East said, the main companies in the hamper industry, through the Christmas Prepayment Association, introduced new safeguards for consumers’ money in the form of independently controlled, ring-fenced trust accounts. I know that the hon. Lady is doubtful about the self-regulation of the industry, but however imperfect, those safeguards represent significant progress for an industry that has, quite frankly, faced something of a shake-out following the Farepak affair. Relatively few businesses are now involved in that industry, and their coming together in the way that I have described represents significant progress.
There are various other Christmas saving accounts, such as clubs run by supermarkets, large retailers, local shops, social clubs, pubs and workplaces, and risks are always associated with any business of that kind. They are bigger and certainly more widespread than the principal companies that most of us know about. Local schemes exist throughout the country, and have done so throughout my lifetime if not considerably before. I remember my mother being part of a small, local Christmas saving club when I was a child, and it is hard to regulate every such arrangement. None the less, the Office of Fair Trading has produced a leaflet entitled “Save Xmas”—I am sorry it is not “Save Christmas”—which is a quick guide to paying for Christmas. The leaflet lists various schemes and indicates whether there is any protection should they go bust. It is important that people who put their money into such schemes know where they stand at the outset, because that has not always been the case in the past.
The Money Advice Service provides advice on its website about what protection is offered for various ways of saving money, and in addition, the Office of Fair Trading’s consumer codes approval scheme, which aims to safeguard consumer interests and raise standards in markets, lists the protection of prepayments as one of its criteria. The OFT has approved 10 codes so far, and we are currently consulting on how consumer codes will operate in future, in light of proposals for institutional reform for those bodies that are currently responsible for consumer and competition policy. Those measures should help savers to avoid losing prepaid moneys in future.
On the issue of insolvency, it is clearly a matter of regret that more money is not available for distribution, and I understand the concerns mentioned by the hon. Member for Newport East, and others, about the expenses incurred in dealing with liquidation—I think she described the figure as “eye watering,” and I do not disagree. Farepak is clearly no ordinary insolvency because it is so complex. It was complex from the start and involved an exceptionally large number of customers and agents—more than 116,000—and the identities of many of those were initially unknown. Considerable work was therefore involved in identifying creditors and substantiating their claims.
The creditors’ committee, which represents those who have lost money, has received regular detailed reports on the progress of the liquidation and approved the actions of the liquidators. I understand that the liquidators have undertaken various investigations in order to increase asset realisations, including action that resulted in £4 million being recovered from the directors of the company. I also understand that the liquidators are currently working to bring proceedings against third parties, with the intention of increasing the pot of money available to creditors. Given the nature of such an action, the liquidators say that it is not possible to determine when moneys will be paid to creditors. As a result of this debate, however, I will make further inquiries, and ask the Minister responsible to report back to hon. Members about the anticipated time scale, in so far as he reasonably can.
The liquidators point out that the work they have undertaken over the years has resulted in the possible amount payable to creditors increasing from 5p to 15p in the pound. I accept that 15p may not be perceived as sufficient, but as the hon. Lady knows, it has substantially increased from the original estimate. The liquidators have also stressed that the creditors’ committee can, at any time, instruct them to stop their activities and pay creditors from the funds already secured. They have also indicated that due to the sheer number of creditors, the process of paying a dividend will be very expensive. They therefore want to ensure that as far as possible, all money that can be recovered is received before a payment to creditors is made. The aim is to get the amount returned per pound to the highest possible level before we start the process of paying the creditors. Otherwise, we will add to the administrative costs associated with the process, and the balance between what that costs and the benefit people receive will be even further out of kilter.
I do, however, believe that the figure of £8.2 million, in contrast with the current dividend prospect of £5.5 million, causes considerable concern. I know that the hon. Lady shares my concern about the level of fees, and she will know that the Government have considered the issue and what should be done in the future. I hope that what I have said today will provide some assurance that I, and other Ministers, believe that we cannot leave the situation as it is in terms of how such matters are handled.
In April 2010 new provisions came into force for insolvencies commencing after that date, giving creditors additional powers to obtain information about the fees and expenses charged by insolvency practitioners. The percentage of creditors required to bring a challenge in court was reduced from 25% to 10%, and the issue of fees charged by insolvency practitioners was considered by the OFT in a report published in June 2010.
Earlier this year, my hon. Friend the Member for Kingston and Surbiton, the Minister with responsibility for issues of insolvency, issued a consultation on a set of proposed reforms to the regulation of insolvency practitioners, including how practitioners deal with complaints. Our aim is to ensure transparency and accountability and to improve confidence in the insolvency process.
This has been a useful discussion on an important subject. I have had little time to sum up the debate, but I take this issue seriously, just as the Government take seriously the whole business of dealing with insolvency. We will take steps to ensure that the process is fair, reasonable and timely, and I will ask my hon. Friend the Member for Kingston and Surbiton to come back to Members on any specific points that I have not had the chance to cover, and make the position clear.
Alcohol Taxation
(13 years ago)
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Dr Sarah Wollaston (Totnes) (Con)
I have watched many of my former patients die as a result of alcohol; there is nothing like witnessing the end of the journey to focus one’s attention on the need to prevent people from becoming harmful drinkers in the first place. We are witnessing an unprecedented rise in hospital admissions and deaths from alcohol-related liver disease. Alcohol is directly responsible for more than 6,500 deaths and more than 1 million hospital admissions a year. It is the single largest cause of mortality in young people, accounting for one in four deaths among 15 to 24-year-olds—far more than die as a result of knife crime. There are now 1.6 million dependent drinkers in England alone.
However, the point about alcohol is that it does not just affect the drinkers themselves; it has a devastating effect on their families, especially children, and on entire communities. There are 705,000 children living with a parent who is a dependent drinker. Parental alcohol abuse is a factor in half of child protection cases.
The full costs are hard to quantify, but the bill runs to at least £20 billion a year.
Mr Kevin Barron (Rother Valley) (Lab)
The hon. Lady will know that I chaired the Select Committee on Health in the previous Parliament. We conducted an inquiry into alcohol, and it was the first time in many decades that a Select Committee had done that. We took evidence that the cost to the NHS could be as high as £55 billion a year. The situation is similar to that with tobacco: in the end, no one really knows the cost of the use of these products.
Dr Wollaston
I thank the right hon. Gentleman for that intervention. He is absolutely right. The study to which he refers took into account the reduced quality of life years associated with alcohol, which are extremely difficult to quantify.
In three years’ time, the Government will be judged not just on the economy, but on other tangible markers, such as violent crime, the prison population, health inequalities—even markers such as teenage pregnancy. It is hard to think of a social marker that is not affected by alcohol.
However, there are other compelling reasons for taking action. At a time of squeezed police budgets and when the NHS needs to find efficiency savings of £20 billion, we should not be pouring that money down the drain because of the problems that this country has with alcohol. About half the offenders in some prisons are jailed for an offence in which alcohol played a significant role. The relationship between crime and alcohol is not linear, but the positive association between violent crime and alcohol is compelling. There is a wealth of evidence to link alcohol price increases and reduced rates of homicide, rape, robbery, assault, motor vehicle theft and domestic violence.
Brandon Lewis (Great Yarmouth) (Con)
I congratulate my hon. Friend on securing this important debate. In terms of alcohol price increases having the effect that she has just outlined, does she agree that one easy, fast and effective route that the Government could take to stop underpriced and low-priced alcohol being sold would be to go ahead with duty stamping on beer and wine to ensure that alcohol is sold at the right price and, equally, to save the Government up to £1 billion a year of revenue that is currently lost through the tax being avoided?
Dr Wollaston
That is one of the options. I would like to outline an alternative, but I certainly thank my hon. Friend for that intervention.
Numerous studies around the world have shown public health benefits as a result of price increases and taxation policies, so is it not time for some evidence-based politics? The trouble is that there is no single, simple solution. We know that there are other factors in addition to price: availability, our drinking culture and marketing. Those are all key factors, but today’s debate is about taxation, so I will focus entirely on price, not because the others do not matter, but because they are not within the remit of the Treasury.
It is worth pointing out that most health experts feel that changing pricing is the most effective way of achieving results. I draw the attention of my hon. Friend the Minister to the letter in today’s edition of The Daily Telegraph signed by 19 organisations. I know that the Treasury is aware of the costs to our economy of dependent drinkers and binge drinking, so I will not ask my hon. Friend to respond in detail on those points. As disposable incomes have fallen, so too has the overall consumption of alcohol, but that comes on the back of decades of steady increases. Alcohol remains about 44% more affordable than it was in 1980.
In 2010, a total of 48.4 billion units of alcohol were sold in the UK. Of those, 31.8 billion units—about two thirds; the great and increasing majority—were sold by the off-trade. The widening gap between the price of on-licence and off-licence alcohol is becoming far more significant and is fuelling the rise in home drinking. Harms are not going down as we might expect as a result of the small fall in overall consumption, because of the low-price deals that are still very widely available in supermarkets, garages and convenience stores pretty much around the clock.
Guy Opperman (Hexham) (Con)
I congratulate my hon. Friend on obtaining the debate. The north-east has one of the worst rates of liver disease: we have seen an increase of 400% since 2002. I accept entirely the point that she makes about robust regulation in terms of minimum pricing, but does she accept that the local supermarkets in our individual constituencies can make a specific difference on the pricing and availability of alcohol and the way in which it is presented to our constituents?
Dr Wollaston
I absolutely agree. Most of the alcohol-related carnage is caused by young binge drinkers and by heavy or dependent drinkers, so the issue is not only about the availability of alcohol in outlets throughout the country. The harm is not going down, because those groups are the ones that are most attracted by the low-price deals.
Andrew Griffiths (Burton) (Con)
I congratulate my hon. Friend on securing this important debate. I declare an interest as chairman of the all-party beer group. I agree with her about the need for the Government to take action. Does she agree with me on this point? Twenty years ago, the price in a supermarket and the price in a pub were much the same at about 75p a pint. Today, a pint costs £3.10, £3.20 or £3.30 in a pub, whereas in a supermarket it remains at about 70p or 80p. That has encouraged people to drink more and more at home and discouraged them from drinking in a safe, supervised environment such as the community pub that is at the heart of many of our towns and villages.
Dr Wollaston
I thank my hon. Friend: he makes an excellent point about the decline in rural pubs and why any action that the Minister takes has to take into account the impact on rural pubs and, of course, town pubs.
Jason McCartney (Colne Valley) (Con)
I congratulate my hon. Friend on securing the debate. I have to declare an interest. I worked behind the bar in one of my local pubs on a recent Friday evening, celebrating British beer week. I am also a member of the all-party beer group. I echo the comments made by my hon. Friend the Member for Burton (Andrew Griffiths). In a pub, we have a safe environment; we have a landlord who is licensed. That encourages responsible drinking. The pub I worked in—the Wills O’Nats in Meltham—was a family environment. Young people were there, drinking soft drinks until early in the evening. Does my hon. Friend agree that any taxation put in place by the Government should not just be about revenue streams, but should encourage responsible drinking in the community pub environment?
Dr Wollaston
I absolutely agree. The point is that in the UK harmful drinkers buy 15 times more alcohol than moderate drinkers, yet they pay 40% less per unit. Those are the groups that are most influenced by pricing. That is why I agree with my hon. Friends that the problem does not come from pubs.
I did have a prop for the debate. Last weekend, my researcher was able to access 2 litres of own-brand cider from Asda for £1.48, which worked out at just 18p a unit. With a four-pack of bitter for 68p, the price was just 17p a unit. I particularly objected to the labelling. It said, “Asda Smart Price”. I put it to hon. Members that there is nothing smart about charging 68p for four units of alcohol. That would send a woman well over the safe limit for a single day for just 68p.
Mike Wood (Batley and Spen) (Lab)
I, too, congratulate the hon. Lady on securing the debate. It is significant that Asda is the supermarket she cited, because it is seen as the one supermarket that has so far taken a lead in trying to get to the bottom of two-for-one offers and the like. If Asda is still behaving as badly as that, what can we expect from the others?
Dr Wollaston
Asda has acquired a veneer of respectability by signing up to the new responsibility deal, but I would ask whether it is killing its customers with such pricing. Asda has liked to boast of its responsible approach in removing low-price offers from its foyers, but I put it to Asda that those who conduct proxy sales on behalf of teenage binge drinkers have no trouble in locating the cider at the back of the store. It is the ultra-low pricing that is causing the carnage.
I recognise that the Government are trying to introduce a floor price for alcohol that will include duty and VAT. The trouble is that the policy will not go far enough to solve the problem, as it will still allow white cider to be sold at below 10p a unit. It will establish the principle of minimum pricing without the prospect of delivering any meaningful results. Will the Minister set out what responses she has received from public health experts on that point? All the public health advice that I have seen is entirely pessimistic. The Daily Telegraph pointed out today that the policy will catch only one in 4,000 of the drinks currently being sold and will do nothing to save lives.
Andrew Griffiths
Does my hon. Friend agree that it was this Government who introduced, for the first time, a ban on below-cost selling? That was an important line in the sand—the first time that a Government have said that selling booze too cheaply is a bad thing. The question now is how cheaply?
Does my hon. Friend share my concern that the current tax system seems to encourage people to drink ever stronger and stronger drinks? The tax system encourages the strength of wine to increase dramatically, and the drink of choice of young people is now vodka.
Dr Wollaston
I thank my hon. Friend for making that point. We need to show what minimum pricing means in practice if we set a reasonable price. If we set a minimum price of around 45p a unit, as the Scottish Government are planning to do, in a Bill introduced at the end of October, it would mean that a bottle of whisky containing 28 units could not be sold below £12.60, a bottle of wine containing 10 units could not cost less than £4.50, and a pint of beer with two units could not cost less than 90p. Such prices would not suck all the fun from a night out; in fact, they would not raise the price of alcohol in the on-trade at all.
Dr Wollaston
May I make a little progress? The case against a minimum price of between 45p and 50p a unit may hang on the loss of income to the Treasury. Alcohol duty raised £9.5 billion in 2010-11, which is equivalent to 1.7% of total Government revenue. There is a certain illogicality in the bands set by the European Union, so to a certain extent, as my hon. Friend the Member for Burton (Andrew Griffiths) said, there is great encouragement towards higher strength products.
The amount received by the Treasury is the same whether a product is sold in a pub or a supermarket. VAT is levied on top, but there are no specific data on where and on what products it is levied. Will the Minister set out estimates of the loss of income that would arise from the introduction of a minimum unit price of between 45p and 50p? Will she also set that against the benefits in estimated savings to the Home Office, the Department of Health and the Ministry of Justice that would result from a reduction in alcohol-related harms?
The Department of Health leads on alcohol policy. It has stated repeatedly that it does not wish to disadvantage moderate drinkers on a low income. However, it has failed to point out that harmful drinking disproportionately affects the poorest and most vulnerable in our society, and is a significant contributor to health inequality. A report on the Department’s behalf from September 2011, titled “Narrowing the health inequalities gap”, makes it quite clear that if it were not for alcohol-related deaths, and if we had had an effective policy, the objective to narrow the overall life expectancy gaps for the spearhead local authority areas—the most deprived areas in our country—
“would…certainly have been achieved for males; and would be well on the way to being achieved for females.”
The evidence is not just that low-income groups suffer the most health harms, but that they suffer the most harms as a result of violence in their communities.
If we look at the evidence from some shopping basket data published in a university of Sheffield study, we can see that for
“a 50p minimum price, a harmful drinker will spend on average an extra £163 per year whilst the equivalent spending increase for a moderate drinker is £12.”
In other words, the published data state that such a policy will not penalise low-income moderate drinkers.
The deprived spearhead communities have the most to gain from an effective alcohol policy. A minimum or floor price can be set that is not regressive and is affordable for anyone who is not drinking at hazardous levels. As one of my correspondents pointed out:
“If you can’t afford 50p per unit it is a good sign that you are drinking too much.”
The charge is often made that without an increase in duty the profits will go to the drinks industry and retailers, not the Treasury. I can understand that, but if we can introduce windfall taxes on energy companies, why not have windfall taxes on supermarkets that profit from windfall gains? With more than 31 billion units sold in the off-trade, why not even consider a health levy on unopened bottles, perhaps of between 5p and 10p a unit, targeting just the off-trade? That would be more than enough to allow for decent treatment programmes. Evidence shows that for every pound we invest in such programmes, we save £5 in wider benefits to the economy because of reduced harms.
Guy Opperman
Does my hon. Friend think that it would be a good idea to introduce an alcohol Act similar to that which exists in Scotland?
Dr Wollaston
I could not agree more.
Finally—I know that other Members would like to come in—there are those who argue that a minimum price is illegal under EU law. If so, why are the Scottish Government so confident that it is not? I draw the Minister’s attention to a reply given by Mr Dalli on behalf of the European Commission to a question put by an MEP on that point. The bones of the reply are that
“the Commission fully shares with the Honourable Member the conviction that there are strong public health reasons for the EU to tackle alcohol-related harm including minimum pricing measures.”
Will the Minister set out today whether there have been discussions with the Scottish Executive on the matter? Will she also comment on what steps the Treasury will take to tackle supermarkets’ plans to undermine Scotland’s decisive action to tackle the carnage caused by alcohol? Tesco recently e-mailed Scottish customers to reassure them that they will still be able to access cut-price deals after the Act is in force, as the products will be delivered from across the border. Will the Minister join me in condemning that e-mail from Tesco?
Yesterday, the Select Committee on Health returned from a visit to Carlisle, and it is clear that the city is expecting an increase in cross-border sales. It would prefer to see us use an evidence-based policy to protect the north-west, which has suffered from the devastating impact of alcohol. There have been many calls for effective minimum pricing and numerous models show the amount of lives and money saved, so I do not want to go over them in detail, other than to point out again that a 50p minimum price could save nearly 10,000 lives a year.
We have shown that Britain is prepared to stand our ground in the EU when it comes to the City of London. Now is the time to put the lives of our young people ahead of the theoretical risk of a legal challenge. A precedent exists in the loi Evin, which the French introduced to protect children from the effects of alcohol marketing in France. It has been challenged repeatedly by the industry in the EU’s courts, but it was upheld on the grounds of the health benefits. I fully agree with that.
Mr Barron
I agree with the hon. Lady regarding unit pricing, as did the Select Committee. One issue that caught my ear in her presentation is that of spirits. For 10 years, I have sat in Budget speeches in the House of Commons Chamber, when everyone cheered when the duty on spirits never went up. Then a £6 bottle of vodka became the choice for binge drinking. That is one of the lessons that the Treasury should learn.
Dr Wollaston
I could not agree more. Pricing plays, and has played, a role in the massive increase in the drinking of vodka, particularly by young women.
There are other ways of levelling the playing field, if the Treasury wants more income after minimum pricing. I know that the Minister is aware of the paper written by Dr Nick Sheron in which he argued that we could vary VAT between the on and off-trades to achieve minimum pricing, without damaging our pubs. I accept that the Treasury is convinced that that would be illegal under EU law. That is just another example of the completely illogical rules by which alcohol duty is set from across the channel, and is a prime example of the intrusive and frustrating way so much of our legislation is controlled by the EU.
I finish by asking the Minister not to commit to a floor price that will be meaningless. Will she assure the House that she will meet her Scottish counterparts to discuss why they are convinced that it is legal to introduce a realistic minimum price for alcohol? Can she assure me that the Government will look at the consistent and evidence-based advice from health experts on minimum pricing, and at least ensure that supermarkets south of the border do not undermine what is happening in Scotland? Can she also assure me that the Treasury recognises that alcohol is not an ordinary commodity, but a psychoactive, teratogenic carcinogen, which also happens to be addictive?
I finish with a story from one of my constituents, who spoke to me after trying to stop a drunken lout urinating on a semi-conscious vulnerable woman in the street. Is that the picture of Britain that we want to send to the rest of the world in our Olympic year? It really is the picture that other people are starting to have of Britain, and it is completely preventable. We just need bold action from the Government. Otherwise, we are abandoning another generation of young people. There is no such thing as a free lunch and equally no such thing as a cheap drink. We are all cross-subsidising cheap deals in supermarkets by paying extra for our groceries and other products. There is no such thing as a cheap drink: we are all paying a heavy price.
The Economic Secretary to the Treasury (Miss Chloe Smith)
I congratulate my hon. Friend the Member for Totnes (Dr Wollaston) on securing the debate. I recognise that, as a general practitioner, she can draw on direct experience on dealing with the adverse effects of alcohol on health. I also acknowledge her reference to the contribution in The Daily Telegraph today from other professionals in the field.
I can assure all hon. Members who have spoken—it is a pleasure to hear so many—that not only GPs have such concerns about the effect of alcohol on the welfare and well-being of society; that concern is shared by the Government. It is clear that alcohol abuse causes serious harm to health and leads to considerable costs to the NHS and that many towns and cities are affected by alcohol-related violence and crime, as my hon. Friend has said. Like her, of course I abhor behaviour such as that in the example on which she finished her speech.
For all those reasons, the coalition Government are committed to tackling problem drinking across a range of fronts. I shall set out a few points on which action has already been taken. I shall try to do so quickly, to get on to minimum unit pricing, as my hon. Friend has requested. I will begin by trying to tackle a couple of points made by other hon. Members. Irresponsible drinkers, rather than responsible drinkers in pubs and other places of safety, are the problem.
I shall try to tackle a couple of the specific questions. If I do not do get there in time, I hope that my hon. Friend will forgive me if I write to her on a couple of points. With regard to measures that the Government have already taken, I hope that they will demonstrate and reassure her that the Government are committed to an evidence-based approach. I specifically reassure her of that today. It is, of course, a subject on which data speak clearly. It is a complex subject that requires much analysis of evidence.
I shall start that process with what the Government have done. My hon. Friend will know that the Treasury published the review of alcohol taxation in November 2010, which among other things identified a problem with so-called super-strength lagers, about which others have spoken today. The Government confirmed in the 2011 Budget that action would be taken to discourage consumption of those drinks, introducing two new additional duties, which should help. There are also targeted approaches on other types of drink—for example, a minimum juice content for products that qualify as cider. I note my hon. Friend’s point about ciders.
Andrew Griffiths
The Minister has clearly got up to speed quickly on her brief. With regard to cider, does she agree that it seems completely incongruous that the 4% duty paid on a pint of beer is twice that paid on cider—2%—at exactly the same strength?
Miss Smith
I am aware of that specific point, and I am sure that my hon. Friend and his colleagues will be even more aware of that tonight at the all-party parliamentary beer group’s Christmas party, if I have that correct. If he will forgive me, I will focus on minimum unit pricing in this debate, to deal with points raised by my hon. Friend the Member for Totnes. I shall briefly note that she raised the wider impacts of alcohol. Of course, it is not just the duty system that is important. I direct her to the Police Reform and Social Responsibility Act 2011, which I hope will help with the late-night economy. To make an important point, I direct her to a forthcoming paper from the Department of Health, which, with the Home Office, is responsible for this area, that will consider the wider social and health impacts of alcohol. I have no doubt that she will look at that in some detail.
Guy Opperman
A simple question: when assessing taxation in the alcohol strategy document, working with the Department of Health, will there be a difference in the views on taxing supermarket sales compared with the pubs that we all cherish and that are so affected by this?
Miss Smith
If my hon. Friend will allow me to come to that, I shall attempt now briefly to answer a number of the questions asked. First, as my hon. Friend the Member for Totnes explained, the Scottish Government have recently introduced a Bill that seeks to bring in a 45p per unit minimum price. She asked why this Government believe that that would be incompatible with EU law, when the Scottish Government do not. If I may quote the specific point: we believe that it could be incompatible with article 34 of the treaty of the functioning of the European Union. I should be delighted to go into more detail on that if she required. That is the position.
I should like to deal with the important point made by my hon. Friend the Member for Hexham (Guy Opperman). No one wishes to hit pubs unnecessarily. I take the examples about the behaviour of supermarkets that have been given. Like hon. Members, I am wary of those. If an indirect tax were introduced, it would be difficult to distinguish between points of sale. I am happy to come back to hon. Members in more detail on why that is difficult, but it is not as straightforward as saying that we want to hit supermarkets and not pubs; it is about how to set up an indirect tax.
On that note, as hon. Members will have heard in other debates, it is difficult to find ways to vary VAT on similar products. Again, I am happy to come back with more detail on that if required. On price distortion and perhaps distasteful practices at the border, the UK Government will look into that closely. My hon. Friend the Member for Totnes asked whether we will discuss matters with the Scottish Government. We will be watching the situation extremely closely in the service of seeing what works and what we can assess among these complex policy and legal issues.
I will go briefly to a couple of other questions that my hon. Friend asked me: have we received representations from public health representatives on the duty plus VAT measure? I regard that measure as a starting point, as a first step. She rightly notes that it introduces a principle and a starting point. Treasury officials are very closely involved in discussing such matters with the Department of Health and, as I have already mentioned, the Home Office, which is also responsible in part for alcohol. I hope that reassures her.
We have mentioned supermarkets. I shall briefly turn to whether a windfall profit tax could be introduced as a method of trying to tackle some of the harms. First, this is about evidence. It is questionable whether windfall profits are likely to arise, and therefore whether there would be something to tax, as a viable approach. That question rests on carefully analysing the evidence, policy and legal issues and what is possible.
Finally, I hope that I have set out that the Government have taken some action and made some starting points. The Government are keen to hear evidence on the matter and will observe carefully what is going on in Scotland and elsewhere.
Question put and agreed to.
Written Ministerial Statements
Foreign Affairs Council (Pre-Council Statement)
The Parliamentary Under-Secretary of State for Business, Innovation and Skills (Mr Edward Davey)
The EU Foreign Affairs Council will take place in Geneva on 14 December 2011. The agenda will cover items relating to the eighth World Trade Organisation ministerial meeting to be held in Geneva, 15 to 17 December. I will represent the UK.
The substantive agenda items will be: the position to be taken on the accessions of Russia, Samoa and Montenegro to the World Trade Organisation and mandates for deep and comprehensive free trade agreements (DCFTAs) with the middle eastern and north African (MENA) countries.
The Government’s objective for the Council is to support the accessions of Russia and Samoa to the World Trade Organisation and the mandates for DCFTAs with the MENA countries.
Annual European Union Finances Statement
(13 years ago)
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The Financial Secretary to the Treasury (Mr Mark Hoban)
I am today laying before Parliament the annual European Union finances “Statement on the 2011 EU budget and measures to combat fraud and financial mismanagement” (Cm 8232). It is the 31st in the series.
The statement gives details of revenue and expenditure in the 2011 EU budget and covers recent developments in EU financial management and measures to counter fraud against the EU budget. It also includes updated details on the UK consolidated statement on the use of EU funds in the UK and changes related to the multi-financial framework.
Looking forward to future years’ budgets, and particularly in the current economic and financial climate, the Government remain determined to ensure better value for money in EU budget spending, to oppose unacceptable budget increases, and to push for improvements in EU financial management.
New Schools
(13 years ago)
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The Secretary of State for Education (Michael Gove)
I am committed to responding to calls from employers for an education system that develops the future work force with the skills they need. Business leaders say that equipping young people with employability skills—such as punctuality, good communication, reliability and teamworking—should be a top education priority for the Government.
Studio schools offer academic and vocational qualifications, but teach them in a practical and project-based way. Study is combined with paid work placements with local and national employers that are involved in the school.
I am pleased to confirm today that 12 new studio schools have been approved with a view to opening in September 2012:
Bradford International Food and Travel Studio School, Bradford |
Da Vinci Studio School of Science and Engineering, Hertfordshire |
Discovery Studio School, Stoke-on-Trent |
Fulham Enterprise Studio School, Hammersmith and Fulham |
Hull Studio School, Hull |
Hinckley Studio School, Leicestershire |
Hyndburn Studio School, Lancashire |
Bournemouth Learning and Achievement Foundation Studio School, Bournemouth |
Ockendon Studio School ,Thurrock |
Parkside Studio School, Hillingdon |
Tendring Studio School, Essex |
The Studio, Liverpool |
These schools respond directly to the demand of parents, communities and business.
I have approved the very strongest applications today. I fully expect some of the groups that are disappointed today to submit even stronger applications in the future and I encourage them to do so. Indeed, the application process to set up new free schools, university technical colleges and studio schools in 2013 and beyond has already been announced. I want particularly to urge groups to submit applications to set up new schools in areas of deprivation and basic need and where skills shortages are particularly evident.
UK Oil and Gas Regulatory Scheme (Review)
The Minister of State, Department of Energy and Climate Change (Charles Hendry)
My right hon. Friend the Secretary of State for Energy and Climate Change, in a statement to the House on 14 June 2010, indicated that a review of the regulatory regime for the offshore oil and gas sector would be undertaken. I am pleased today to have deposited in the House the report of that review conducted by a panel under the independent chairmanship of Geoffrey Maitland, Professor of Energy Engineering at Imperial College, London.
The impetus for this exercise was, of course, the disaster which befell the Deepwater Horizon rig during drilling operations in the gulf of Mexico in April 2010. The tragic loss of life and widespread pollution which arose as a consequence of the blow-out on that rig were a salutary reminder to industry and regulators alike of the need for the highest standards of safety and environmental control in this potentially hazardous industry. Inevitably the incident led to a number of both internal and independent investigations in the US which have shed a great deal of light on the causes of the disaster and given rise to recommendations designed to ensure that the risks of a repeat are minimised.
Given the infrequency with which such serious incidents occur in the offshore industry, it is important that we learn all available lessons from them. I am, therefore, grateful that Professor Maitland and his colleagues have examined the US evidence with obvious rigour and distilled from it such a constructive road map for driving ever higher standards in the UK.
I am pleased to note the report acknowledges as the starting point the strengths of the UK’s safety and environmental control regime and the high regard in which the authorities are held both domestically and by international observers. I trust that the industry itself will be reassured to note that the report also acknowledges the extent to which UK operators and industry bodies have mobilised themselves since Deepwater Horizon in an effort to raise those standards. The review has, however, identified a number of important areas, particularly around the assured implementation of regulatory requirements and the promulgation of best practice, where there appears scope for further improvement.
A great many of the insightful recommendations of the report are characterised by the theme of collaboration, whether that be between regulators, among operators or across those boundaries. In this respect, as one of the responses to the Deepwater Horizon incident, a new memorandum of understanding (MoU) has already been signed between DECC and the Health and Safety Executive (HSE). I have asked that the joint board, which has been established as a result, provides advice to myself and Department of Work and Pensions (DWP) Ministers on the recommendations which are relevant to the regulators. I have also asked my officials to work with HSE and, where relevant, Maritime and Coastguard Agency colleagues in considering with industry the broader recommendations with a view to identifying and embedding the improvements this report suggests are achievable.
I have requested that regulators work with industry to produce an agreed response and action plan by July next year.
Revenue Allocations 2012-13 (Primary Care Trusts)
(13 years ago)
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The Secretary of State for Health (Mr Andrew Lansley)
Today I am announcing revenue allocations to primary care trusts (PCTs) for 2012-13.
The PCT revenue allocations in 2012-13 will grow at 2.8%, which represents a real-terms increase, taking account of the Office for Budget Responsibility figure for the GDP deflator in 2012-13. This represents continued positive investment in front-line NHS services.
This means total investment in local NHS services in 2012-13 of £91.6 billion, an increase in excess of £2.5 billion in total allocations assigned in 2011-12. It puts the NHS in a strong position to deliver the Government’s national priorities set out in the 2012-13 operating framework published on 24 November.
To allow the NHS financial stability during a period of transition, the weighted capitation formula, normally used to determine PCTs fair shares of available resources, has not been applied to the allocations. For 2012-13, all PCTs will receive the same percentage uplift in their recurrent allocations.
This will be the last round of allocations made to PCTs as, subject to the passage of the Health and Social Care Bill, the NHS Commissioning Board would be responsible for the allocation of resources and pace of change policy to clinical commissioning groups (CCGs) from 2013-14.
In common with previous practice, I have today written to all hon. Members to inform them of the revenue allocations made to the PCTs covered by their constituencies.
Full details of all local allocations, including details of other, specific allocations (to support primary dental care, pharmaceutical services, general ophthalmic services and joint working between health and social care) have been placed in the Library. Copies are available to hon. Members from the Vote Office and to noble Lords from the Printed Paper Office. They can also be found at
www.dh.gov.uk/health/2011/12/pct-allocations.
Domestic Violence
(13 years ago)
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The Secretary of State for the Home Department (Mrs Theresa May)
I am launching today a consultation on the cross-Government definition of domestic violence. The consultation will run until 30 March 2012 and a consultation paper is available on the Home Office website. A copy of the consultation document will also be placed in the House Library.
The ambition of this Government is nothing short of ending violence against women and girls. As we set out in our strategic vision—“Call to End Violence Against Women and Girls”—prevention will be key to achieving that ambition. Effective prevention can only happen when it involves all agencies, working together to common goals and common understanding. That is why we are now consulting on a definition of domestic violence that all agencies and all parts of Government should use.
There are a number of aspects to the definition that this consultation considers. We are seeking views on whether the current cross-Government definition of domestic violence is working and should remain. We are also consulting on whether the definition of domestic violence should include younger victims below 18 years of age, including boys, and whether coercive control should also be reflected in the definition.
Employment Tribunals and the Employment Appeal Tribunal (Fees)
(13 years ago)
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The Parliamentary Under-Secretary of State for Justice (Mr Jonathan Djanogly)
I have today published a consultation paper on introducing fees in the employment tribunal and the Employment Appeal Tribunal. The introduction of fees to these bodies will relieve pressure on the taxpayer by transferring some of the cost burden from taxpayers to users. It will also encourage parties to think through whether they might settle their disputes earlier and faster by using other less adversarial methods of dispute resolution, such as ACAS conciliation, which will continue to be provided free to users.
At a time of economic difficulty, I also recognise that Her Majesty’s Courts and Tribunal Service provides a vital service to business, and must play its part in the Government’s determination to confront the structural barriers that create unnecessary delay or cost to business, or impede competitiveness, employer confidence and the creation of jobs.
These tribunals cost the taxpayer over £84 million per annum and currently no financial contribution is sought from users. The Government think it is right that those who cause the system to be used should contribute towards the cost, in the same way as users of other parts of the justice system contribute to the costs of providing the service. Therefore the principle of charging fees is not in question in this consultation.
The purpose of the consultation exercise is to seek views on two options for a fee charging structure in the employment tribunals and the fee structure proposed for the Employment Appeal Tribunal—all of which incorporate safeguards to protect access to the tribunal for those unable to afford fees.
The consultation closes on the 6 March 2012. For those of you who wish to respond the document is available online, at www.justice.gov.uk.
Carriage of Passengers and their Luggage by Sea
(13 years ago)
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The Parliamentary Under-Secretary of State for Transport (Mike Penning)
I wish to inform the House that the Government have opted in to the Council decision concerning the accession of the European Union to the protocol of 2002 to the Athens convention relating to the carriage of passengers and their luggage by sea, 1974, as regards articles 10 and 11 thereof. The UK notified its intention to the Council and to the Commission that it wishes to accept the measure soon after the Council decision was adopted at Transport Council on 12 December 2011.
The Council decision sets out the basis for the Union’s competence in respect of articles 10 and 11 of the 2002 protocol and authorises the Council to conclude the 2002 protocol on behalf of the EU. A separate Council decision relating to the other provisions of the 2002 protocol was adopted in parallel to this decision. The Union has exclusive competence as regards articles 10 and 11 of the 2002 protocol as it affects the jurisdiction and the recognition and enforcement of judgments in civil and commercial matters in the Union.
The UK has decided to opt in to this Council decision to ensure that it is in a position to ratify the 2002 protocol within the framework of the UN’s International Maritime Organisation, as soon as it is ready to do so. The UK must have opted in to the Council decision if the appropriate provisions on jurisdiction and the recognition and enforcement of judgments are to apply.
The UK strongly supports the entry into force of the 2002 protocol because it will significantly enhance the international regime of liability that exists for damage suffered as a result of the death of, or personal injury to, a passenger and the loss of or damage to luggage, by sea—established by the 1974 Athens convention. The 2002 protocol will require shipowners to maintain compulsory insurance up to approximately £250,000 per passenger per voyage to cover liability in respect of the death of and personal injury to passengers on board ships and significantly raise the limits of liability from approximately £46,000 to £400,000 per passenger on each distinct occasion. It will also introduce other mechanisms to assist passengers in obtaining compensation, based on well-accepted principles applied in existing liability and compensation regimes dealing with environmental pollution. These include replacing the fault-based liability system with a strict liability system for shipping-related incidents and introducing the right of direct action against the insurer.
The Union has already adopted EU Regulation 392/2009 on the liability of carriers of passengers by sea which incorporates the 2002 protocol into EU law and ensures the uniform application of the 2002 protocol in the EU from 31 December 2012. It is, however, important that the UK and other EU member states ratify, or accede to, the 2002 protocol to ensure that both instruments apply simultaneously within the EU as soon as possible. Such an approach will greatly simplify the application of Athens regime in the shipping industry.
A copy of this statement has been placed in the Libraries of both Houses.
Local Authority Major Transport Schemes
(13 years ago)
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The Secretary of State for Transport (Justine Greening)
Following the 2010 spending review the Government committed to a £1.5 billion programme of investment in major transport schemes promoted by local authorities, recognising the impact that such schemes can have on growth and the economy.
Our aim was to ensure that the programme of investment for the spending review period would be affordable, would promote growth and would achieve better value for money for the taxpayer. All local authority promoters with schemes already in the pipeline were challenged to improve their scheme design, reduce costs and secure a greater proportion of funding from local sources.
In February 2011 we confirmed funding for the first nine of these schemes and announced an expanded development pool of 45 schemes that would be considered in more detail.
The local authority promoters of the development pool schemes were invited to submit revised funding bids in September 2011. Funding for 20 of these schemes was confirmed on 29 November as part of the autumn statement.
I am today announcing funding for a further 21 schemes as follows. These represent a mix of road and public transport schemes across England.
A684 Bedale-Aiskew-Leeming Bar Bypass1 |
Bath Transportation Package |
Beverley Integrated Transport Plan |
Camborne-Pool-Redruth Transport Package |
Chester Road (Birmingham) |
Coventry-Nuneaton Rail Upgrade |
Croxley Rail Link (Watford) |
Darlaston (Walsall) |
Elmbridge Transport (Gloucester) |
Leeds Inner Relief Road Maintenance |
Loughborough Town Centre Transport Scheme |
Luton Town Centre Transport Scheme |
Morpeth Northern Bypass |
North Fringe to Hengrove BRT (Bristol) |
Norwich Northern Distributor Road (NNDR)2 |
Nottingham Ring Road |
Pennine Reach (East Lanes Rapid Transit) |
South Yorkshire Bus Rapid Transit Phase 1 (Sheffield/Rotherham) |
Sunderland Strategic Corridor |
Weston Package |
Worcester Transport Strategy. |
1The Department has offered North Yorkshire county council a lower level of funding than that applied for. The council has until the end of January 2012 to accept this offer. 2Subject to Norfolk county council agreeing to fund a package of sustainable transport measures in Norwich city centre. |
This is a major programme of investment. The schemes announced today will cost £854 million with a DFT contribution of up to £586 million in this spending review period and beyond. The total DFT contribution to all 41 schemes will be up to £972 million, compared to the £1.575 billion that was previously requested for these schemes prior to the spending review—a 38% reduction. This means that a far greater number of schemes can go ahead than would otherwise have been the case.
All the schemes announced will now be able to progress towards construction subject to securing any remaining necessary planning and statutory approvals and subject to confirmation of value for money where material changes to the scheme have been proposed.
We are not yet able to make decisions for a further four of the development pool schemes.
In two cases, we have not yet been provided with sufficient evidence to allow us to assess the schemes’ value for money. These are the Leeds new generation transport (Trolleybus) and South Essex rapid transit schemes. In these cases the promoters will have until 31 March 2012 to provide the necessary additional information, and we will make decisions within two months of receipt.
The Waverley link road proposed by Rotherham borough council is opposed in its current form by Sheffield city council, whose land is required for the proposed route. We recognise that there is a case for additional transport capacity in this area but the currently proposed scheme does not appear to be deliverable. We are inviting Rotherham to work with Sheffield and other stakeholders and to propose a resolution to the issue by 31 March 2012.
We recognise the critically important role that transport improvements could play in the regeneration of the Bexhill-Hastings area and the economic case underpinning the Bexhill-Hastings link road, though we are also aware of concerns regarding the proposed scheme, including its environmental impact.
Before we take a final decision on the scheme we want to be sure that it offers the best approach for regenerating the area and also to consider other transport options to achieve this, including local trunk roads such as the A21, A259 and local rail. We also want to consider whether further environmental mitigation measures could be deployed to address the impacts of the proposed Bexhill-Hastings scheme.
Over the next three months the Department will work alongside the scheme’s promoters and other local and regional partners to gather further evidence on the optimal solution for the area. We would intend to make a decision swiftly thereafter.
Details of each of the schemes and the funding offered by the Government are available on the DFT website and will be followed by a more detailed document setting out the details of our decision-making process, and information on our assessment of the schemes.
Grand Committee
Arrangement of Business
The Deputy Chairman of Committees (Baroness Fookes)
My Lords, before the first Motion is considered, I remind noble Lords that in respect of each of the items of business today, the Motion before the Committee will be that the Committee do consider the statutory instrument in question. The Motions to approve the instruments will subsequently be moved in the Chamber in the usual way. I also remind noble Lords that if there is a Division in the House, the Committee will immediately adjourn for 10 minutes.
Electricity and Gas (Carbon Emissions and Community Energy Saving) (Amendment) Order 2011
(13 years ago)
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Lord Marland
That the Grand Committee do report to the House that it has considered the Electricity and Gas (Carbon Emissions and Community Energy Saving) (Amendment) Order 2011.
Relevant document: 34th Report from the Joint Committee on Statutory Instruments.
The Parliamentary Under-Secretary of State, Department of Energy and Climate Change (Lord Marland)
My Lords, these are minor and technical amendments that I hope will not delay the Committee for too long, but which have the potential for a profound impact for all small energy suppliers, being pro-growth and pro-competition. The amendments are deregulatory in nature, cutting red tape for smaller companies to enable them to compete on a more equal footing with the large, established suppliers.
The order gives effect to the outcome of a public consultation process earlier this year, and makes changes to the carbon emissions reduction target, CERT, and the community energy saving programme, CESP. Its primary effect is to increase the threshold at which suppliers are obliged to participate in both schemes from 50,000 customers to 250,000 customers. It further ensures that obligated parties under CERT, as is already allowed under CESP, can trade completed qualifying activity to the end of the programme. This will provide suppliers with flexibility for longer in terms of the options they have to meet their binding obligations. I emphasise that increasing the threshold for CERT and CESP does not mean that customers of small suppliers will lose out. Customers of small suppliers can still benefit from CESP and CERT because suppliers are free to promote these schemes to any householder, not only those customers they supply.
I am sure we can all agree on the importance of increasing competition in the domestic retail market. Competition is key to keeping prices as low as possible for consumers. However, with six large, established suppliers currently supplying 99 per cent of all households, it is clear that we need to take action to reduce barriers to market entry and growth so that smaller companies can begin to challenge the dominance of these big players. This measure is one step to enabling just that.
Energy suppliers with fewer than 50,000 domestic energy customers are already exempt from participation in CERT and CESP. This was to help avoid creating a barrier to new entrant suppliers whereby they would need to commit significant investment to set up CERT and CESP environmental programmes while still at an early stage. We recognise that compliance with some of the Government’s environmental and social programmes places a disproportionate burden on small suppliers as it involves significant fixed costs for which suppliers are not compensated.
The current threshold disincentivises suppliers from growing beyond 50,000 customers. Increasing it to 250,000 will ensure that no small suppliers will be required to participate in the final year of CERT and CESP. This will help boost competition without imposing new costs on the larger suppliers, burdening those suppliers’ customers or reducing the effectiveness of the programmes. Boosting competition is essential to drive innovation, improve the service customers receive from their supplier, and to keep prices as low as possible. I commend this order to the Committee.
Baroness Parminter
My Lords, on our Benches we certainly support the measures in the order. I have three quick questions for the Minister.
It is important that the Government are seen to support a fair and workable distribution of conditions for suppliers participating in environmental and social schemes. In looking at the options, did the department consider a more tapered introduction, say with a small 50,000-strong block of customers rather than the cliff edge of 250,000? If it was considered, why was that approach not adopted? If it was not, might it be as the Government look at future schemes in the area?
My second question is: what estimates are there of the number of new suppliers that will enter the market as a result of this change in regulation? There is no guarantee that smaller suppliers will mean a reduction in the price of a householder’s bills, but we all know that we need to try to cut energy bills and end the dominance of the larger six.
In that regard—supplementary to it—I say that the Minister might find it hard to answer that question because, even if we change this regulation, that will not be the only barrier that prevents people coming into the market. Many of the other barriers, such as liquidity, are outside the Government’s control. Might the Minister take this opportunity to comment on what negotiations or discussions he has had with Ofgem about some of those other barriers to entry into the market, and about whether it intends to act on them in the near future?
Baroness Smith of Basildon
My Lords, I thank the noble Lord, Lord Marland, for his introduction. This change is relatively moderate, minor and technical but it is generally welcomed. The issues that I want to raise are similar to those raised by the noble Baroness, Lady Parminter. Although I welcome the change, I am not sure how much impact it will have, and I have given some indication to the noble Lord of the questions with which I shall probe him for explanation.
Raising the threshold of CERT and CESP from 50,000 to 250,000 customers will benefit smaller suppliers that have reached, are about to reach or are just over the threshold and would struggle to meet the obligations imposed on them, but how many energy suppliers will that affect? I assume that the department has made some assessment or estimate of how many energy suppliers have reached that level and will benefit from not having to fulfil the obligation under CERT or CESP at this time. Any information that the Minister has on the scale of the impact and an indication of the number of companies or customers would be welcome.
The noble Baroness, Lady Parminter, also raised the issue of the impact there could be on bills. Has any assessment been made of the smaller companies, having been relieved of the obligations, passing on the savings that they make to customers? If smaller companies no longer have those obligations, presumably that will assist them with their profit margin. Is it expected that the customer will receive some benefit? My understanding is that, in effect, the larger companies pick up the tab of the obligations not being undertaken in future by smaller companies. Is there any expectation of additional cost being passed on to the customer from the larger companies?
It may be more to do with my lack of computer skills than the DECC website, but I could not find the consultation there. The Minister rightly laughs at me, but I challenge him to find it. I was interested to see whether any responses to the consultation had not been satisfied by the order. The issue that has been raised already is tapering, but I am not sure about it because I could not access the consultation. Did the Government consider tapering the threshold for obligations? Even under the new proposed higher level, which we welcome, there is still an issue about there being an absolute limit at which substantial obligations come into force. Were there representations and responses from the smaller suppliers about a more gradual and graduated approach? If so, were they considered by the Government and what was their reason for rejecting any such taper?
The impact assessment commented on the costs. Is there any impact on carbon or is this measure carbon- neutral? Paragraph 3 of the Explanatory Memorandum, which is headed: “Matters of Special Interest to the Joint Committee on Statutory Instruments”, made the point that there was a delay in the Government announcing their intention to pursue this order change —that was announced in June—because they were considering wider possible changes to the CERT scheme. They are ongoing and are being pursued at the same time as the amendments presented here because they are under strict time constraints. If the Minister could expand on that and say anything about the changes that the Government are looking to introduce, that would be helpful.
Finally, I welcome the Minister’s comments about how essential it is to have market reform if we are to do anything to benefit consumers and assist them with energy prices. As he said, this is just one step. It is a small step but it is welcome. If he can reassure me as regards the points that I have raised, I would be grateful.
Lord Marland
My Lords, I am very grateful for what appears to be a very harmonious coalition of views from all parties, as always. I thank the two noble Baronesses for their comments, particularly the noble Baroness, Lady Smith of Basildon, who I gather has been suffering from a bad cold. However, she made it here today to keep baiting me, as she normally does. I hope that she is feeling well and recovers in time for Christmas.
Before I respond to the points that have been made, I wish to give noble Lords an overall feel of things. CERT and CESP end next year. We do not want to do anything too radical because we all know that we have the ECO coming next year, so we did not think that it was necessary to bring in a tapering scheme for example, but we are consulting on it for the ECO. I know that the noble Baroness, Lady Parminter, knew the answer to that question before she asked it, as, I believe, did the noble Baroness, Lady Smith. We are consulting on that. As I say, there is only a year left. The whole idea of this is to increase competition and not radically to change what is fundamentally a good policy. As the noble Baroness, Lady Smith, said, getting value for the consumer is at the forefront of all our parties’ minds.
Ofgem is about to publish its views on how we can get liquidity into the market. We welcome the fact that it is looking at that. Currently, seven suppliers in the market will benefit from this change. By increasing competition through increasing the threshold we want to encourage other suppliers into the market. I cannot tell noble Lords offhand how many will join this merry thing but others will be looking at it very closely. Seven suppliers is actually the same amount again as there are in the big six, so that is positive competition. The noble Baroness, Lady Smith, loves asking about our website because she knows that I have never seen it in my life. I am sure that it is very good. We consulted in December 2010 and announced our interim views in June 2011 and now we are bringing the measure into law. The noble Baroness wishes to intervene. She is going to ask me about the website again.
Baroness Smith of Basildon
I just wanted the Minister to clarify whether the consultation responses were on the website. Perhaps my efforts to find them on the website were completely hopeless.
Lord Marland
We know that the noble Baroness is not completely hopeless. I look to my officials for information. I am told that there was a summary of responses on the website. As noble Lords know, I am not an expert on that, but it is history now, is it not?
Lord Marland
I thank my noble friend for that very kind interjection. I think that the noble Lords, Lord Henley and Lord Hunt, are here for fun and games. We might stay and watch them later.
Does it reduce carbon? Obviously, that is not the intent of what we are doing here. The intent is to get competition into the market. It will not really change the carbon aspect of things, which is not central to the process. In consultation, we took evidence and more than 80 per cent of the people consulted were for these changes, so there was overwhelming approval. I hope that that deals with most of the questions that I have been asked. On that basis, I ask the Committee to support this order.
Elected Local Policing Bodies (Complaints and Misconduct) Regulations 2011
(13 years ago)
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Lord Henley
That the Grand Committee do report the House that it has considered the Elected Local Policing Bodies (Complaints and Misconduct) Regulations 2011.
Relevant document: 33rd Report from the Joint Committee on Statutory Instruments.
The Minister of State, Home Office (Lord Henley)
My Lords, in speaking to the Elected Local Policing Body (Complaints and Misconduct) Regulations 2011, I shall speak also to the Local Policing Bodies (Consequential Amendments) Regulations 2011. The first set of regulations make consequential amendments to various existing statutory instruments arising from the replacement of police authorities by PCCs and the Mayor’s Office for Policing and Crime, and from the fact that chief officers of police will employ police staff in the future. The second set of regulations sets out the way in which complaints against police and crime commissioners, the mayor’s office and their deputies will be handled.
I will come to the regulations in a moment but I want to start by setting the context and talking about PCCs more generally. The Committee will recall that the Government’s plans for police and crime commissioners are set out in the Police Reform and Social Responsibility Act 2011. There will be 41 elected PCCs in England and Wales who will take office on 22 November 2012. Ahead of that we expect to have a live PCC model up and running in London when the Mayor’s Office for Policing and Crime comes into effect in January.
There has been vigorous discussion and full scrutiny of our plan for PCCs. There has been a public consultation and, as the noble Lord will remember, a lengthy debate in Parliament. The Government listened to concerns. We strengthened the checks and balances on PCCs. We have taken every step to ensure that the British model of impartial policing, which we all prize, is preserved, and Parliament has now spoken.
I now turn to the secondary legislation that is needed to bring about these changes and the subject matter of this debate today; namely the 2011 consequential amendments regulations and the complaints and misconduct regulations. I will take them in turn, starting with the consequential amendments regulations. The regulations make consequential amendments to various existing statutory instruments arising from the replacement of police authorities by PCCs and the Mayor’s Office for Policing and Crime, and from the fact that chief officers of police will employ police staff in the future.
The Police Reform and Social Responsibility Act makes significant changes to the governance arrangements for policing in England and Wales, with the exception of the City of London police area. The Act abolishes the police authorities responsible for maintaining police forces outside London and replaces them with directly elected PCCs. The Act also abolishes the Metropolitan Police Authority and replaces it with the Mayor’s Office for Policing and Crime, an office held by the Mayor of London. In the City of London, the Common Council retains its role as the police authority, and the status of the commissioner of the City of London Police remains unchanged. The Act refers to PCCs, the Mayor’s Office for Policing and Crime and the Common Council collectively as “local policing bodies”.
The consequential regulations in question are not intended to change the substantive effect of the various instruments being amended, except for the purposes of reflecting the changes made by the Police Reform and Social Responsibility Act 2011. Specifically, the regulations will amend the Police and Criminal Evidence Act 1984 (Drug Testing of Persons in Police Detention) (Prescribed Persons) Regulations 2001 to ensure that members of police staff continue to be prescribed as persons permitted to take samples from suspects in police detention for the purposes of drug testing. The amendments to the Docking of Working Dogs’ Tails (England) Regulations 2007 allow members of police staff to continue to present police dogs for certification as working dogs for the purposes of the working dogs’ exemption to the prohibition on the docking of dogs’ tails. Finally, the changes to the Local Authorities (Alcohol Disorder Zones) Regulations 2008 allow for costs in relation to members of police staff designated as community support officers to continue to be included in charges levied in relation to alcohol disorder zones. The costs incurred in relation to the staff and police officers that are currently payable to the police authority will be payable to the local policing body.
Section 6(15) of the Animal Welfare Act 2006 requires the Secretary of State to have consulted those persons appearing to her to represent interests with which these regulations are concerned as she considers appropriate. As the amendments made to the Docking of Working Dogs’ Tails (England) Regulations 2007, to which that requirement relates, concern only police dogs, and the only amendments are for the purpose of replacing references to police authorities, the Secretary of State considered it appropriate to consult only the Association of Police Authorities and the Association of Chief Police Officers. These bodies had no comments to make on the instrument.
Sections 15 to 20 of the Violent Crime Reduction Act 2006, under which the Local Authorities (Alcohol Disorder Zones) Regulations 2008 were made, are repealed by Section 140 of the Police Reform and Social Responsibility Act 2011. However, the Government do not intend to bring Section 140 into force until later in 2012.
As the amendments made to existing instruments are limited, the Home Secretary has no intention to issue guidance or review the impact of these changes. The intention is that these regulations will come into force in January 2012 in the Metropolitan Police Service area of London and in the following November for the rest of the country.
I now turn to the Elected Local Policing Body (Complaints and Misconduct) Regulations. It is expected that PCCs and their deputies will uphold the highest standards of public office. However, in the event that there is a complaint or an allegation against one of them, it is important that this is handled effectively to ensure that public confidence in policing is maintained. The Police Reform and Social Responsibility Act 2011 therefore provides for regulations to set out the way in which complaints or conduct matters about elected local policing bodies will be handled. The Act requires the regulations to provide for allegations of criminal behaviour to be referred to the Independent Police Complaints Commission, and allegations of non-criminal behaviour to be resolved informally by police and crime panels.
The reason for requiring criminal allegations to be referred to the IPCC is that otherwise the office holder may be, or may be perceived to be, at an advantage in relation to the police investigation because of his or her responsibilities for holding their police force to account. The IPCC has extensive experience of handling sensitive, complex and high profile cases and will provide independent scrutiny of the handling and investigation of allegations of criminal behaviour in this context. The regulations set out that criminal allegations will have to be passed to the IPCC quickly and give the IPCC a call-in power—a power to require that allegations against the office holder are referred to it. The regulations also give the IPCC strong powers to investigate criminal allegations which are similar to those for investigating police forces, and require the IPCC to publish a report following its investigation.
Where a complaint is not serious enough to require investigation by or under the management of the IPCC, the regulations provide for it to be resolved informally by police and crime panels. The arrangements for PCP resolution of non-criminal allegations are intended to be light touch and locally determined, although it is intended that the Home Secretary will give some guidance in this area. Panels will be able to delegate the initial handling but not the resolution of complaints to the IPCC’s monitoring officer. We expect that the officer will wish to keep abreast of the handling of complaints through regular reports. The regulations allow non-criminal complaints against the mayor, as the Mayor’s Office for Policing and Crime, or the deputy mayor for policing and crime, if he or she is a member of the London Assembly, to be dealt with in the same way as complaints about the Mayor of London or the London Assembly. This is intended to avoid any potential confusion arising from the MOPC being subject to two different standards of procedures.
The regulations have been developed by the Home Office with some of the main delivery partners who will be affected by the proposals, as set out in the regulations. There has also been a public consultation process which received 31 responses. The Government have considered those responses very carefully and have made some important changes as a result. The main changes that we have made are designed to improve co-ordination of the handling of complaints at local level and to keep any bureaucracy associated with administering the system to an absolute minimum. The intention is that these regulations will come into force in January and will have effect from that date in the Metropolitan Police Service area. They will have effect from November 2012 in the rest of England and Wales when the first PCCs take office.
I said at the beginning that Parliament has now spoken in relation to the PCC model, and the Government’s focus is now on making this model a reality. The regulations before the Committee are an important part of the legislative jigsaw that will make this happen and I commend them to the House. I beg to move.
Lord Hunt of Kings Heath
My Lords, I am sure that we are all very grateful to the noble Lord, Lord Henley, for his explanation of the two statutory instruments that we are debating together this afternoon. As he rightly said, it is only a few weeks ago since we finished proceedings on the Government’s misguided proposals to establish elected police commissioners, but the Opposition will take a constructive approach to these regulations and the many others that are due to come to your Lordships’ House over the next few weeks and months.
As the noble Lord suggested, the regulations under consideration have been developed to a very tight timetable to enable London to transfer early from the current Metropolitan Police Authority to the new Mayor’s Office for Policing and Crime. The problem is that, because of the rush, we are not being allowed sufficient time or opportunity to explore the implications of the regulations for the rest of England and Wales before we deal with the issue in London. Can the noble Lord give me some idea of the timetable for all the other regulations that will be produced? There is some hint that there is a less than cohesive approach to doing this. For instance, while a shadow strategic policing requirement and protocol have been laid, the finance code has not—unless that has been done very recently. That makes it difficult to understand the balance of powers between the chief officer, the PCC and the panel because we do not have a complete picture.
Similarly the regulations on PCC complaints have been laid but the regulations on panels have not. Again, that makes it difficult to understand how the complaints process will work, for instance, in relation to the powers of the panel to suspend PCCs. It would be helpful if the noble Lord, either here or perhaps in correspondence, could set out the programme that the department is working to so that Parliament can consider the many statutory instruments that will have to be laid.
There are three matters missing from the regulations that I wish to put to the noble Lord. The first is the absence of any code of conduct or other means of defining what acceptable behaviour is and is not in non-criminal complaints that are subject to informal resolution. The second is the absence of any sanctions or similar powers for the panel in dealing with PCCs that misbehaved. The third is the absence of any provisions dealing with powers of the panel to suspend PCCs or the process that it should follow. I should be grateful if the noble Lord would comment on that.
I have, of course, discussed this with the Association of Police Authorities, which is worried about the lack of clarity with regard to both acceptable standards of behaviour and the panel’s power in relation to informal resolution. That might result in complainants believing that it is better to frame their complaints in criminal terms in order to ensure that they are dealt with satisfactorily. The example that has been given to me is rude behaviour by the PCC, and we have to reflect that this is a political officeholder. Rude behaviour is not unknown from such political office holders—not, of course, the noble Lord himself, who is always an example of chivalry, gentleness and kindness, but there are politicians who do not have the noble Lord’s high standards.
Taking the example of rude behaviour, the risk for the APA is that this might be framed as harassment, conflict of interest or fraud in order to ensure that it is dealt with by the IPCC, whose role is much clearer under these regulations, and that there is a proper resolution with meaningful sanctions, in contrast to it being dealt with under informal resolution. This is an important point on which the noble Lord might be able to reassure me. Clearly, however dubious I am about the elected police commissioners, one does not want a lot of complaints being made in an unscrupulous way, which would actually inhibit the police and crime commissioners in the course of their duty. I would certainly be worried if there was a temptation by complainants to, in a sense, upgrade their complaint in order for it to be dealt with by the IPCC because there is a lack of clarity about how the informal resolution process might work.
We then come to the issue of what, if anything, a panel can do under the informal resolution proposal to ensure that a PCC makes reparation for bad behaviour. If the panel has no powers in that respect, what happens when a police and crime commissioner rejects a means of reparation that the panel has suggested? What recourse does a complainant then have to ensure that the matter is resolved to his or her satisfaction? Again, I put it to the noble Lord that, if the complainant is dissatisfied, one of their options might be to have recourse to the media. The risk of that, I suppose, is that publicity will have an adverse impact on public trust in policing.
The noble Lord will be aware that one of my concerns about the whole notion of elected police commissioners is that it will reduce public confidence. Clearly we can argue about that, and I am very tempted to invite the noble Lord to have another debate about the principle, but I will not do that. However, Parliament having enacted the legislation, it is important that we work together to make it as effective as possible. I am concerned that, if the public do not have confidence in the informal resolution process, as I have said, either they will upgrade complaints in the future or the process will be discredited, and you may well find that the position of the PCC is also discredited. So I think that this is worth looking at.
Some other, rather more technical issues have been raised. Is there not a need for regulations to state explicitly that a force cannot be asked to undertake the investigation of a PCC if he or she is the PCC for that force or connected to that force through collaboration, agreement or close association? It is probably implicit in paragraph 19(3)(b) but would there be argument over how “impartially” should be interpreted?
I understand the logic of appointing the PCC’s chief executive as monitoring officer to the panel—covered in paragraph 7—to achieve national consistency, particularly in Wales where panels will not be part of local government and so will not have automatic access to monitoring officers in local authorities. Is there a risk of putting that chief executive in a difficult situation? Remember the concept of corporate sole means that the employer of the chief executive is the PCC himself or herself against whom a complaint is being made. Is there not a risk that the monitoring officer will not be able to effectively carry out that duty?
The panels will be asked to judge whether a complaint is serious or not. I assume that means that they will look to the monitoring officer for advice. Again, I point out to the noble Lord that there will be a delicate relationship between the role of the monitoring officer’s chief executive and the PCC who is their direct and only sole employer. It is rather different in corporate set-ups where the company secretary or board secretary would probably carry out that role. It is rather different if it is the chief executive. Might the Government be prepared to look at that, in terms of advice on how it might work in practice?
Paragraph 15(3)(a) raises some concerns. Complaints brought by employees to the PCC cannot be dealt with through these regulations where they concern a PCC’s conduct only towards his or her staff. I well understand that there needs to be provision within employment procedures for handling much of this through established grievance procedures but might there be a possibility that that will not address the situation where an employee is accusing, say, a PCC of a criminal complaint such as harassment? What, for instance, would happen in the case of alleged harassment?
What about joint complaints to the chief constable and deputy or assistant chief constable? With the chief constable becoming the appropriate authority for chief officer complaints, there is concern among chief authorities about the potential situation where a joint complaint has been made against the chief constable and someone in the chief officer team. This could result in a chief constable effectively investigating their own complaint. That might strike at public confidence. The question here is whether that should then give the PCC locus in relation to any less senior officer. I would be grateful for some clarification on that.
Are there enough checks and balances around the PCC’s ability to dismiss the chief officer? Of course, we have discussed this in our debate on the Bill. It is worth making the point that PCCs will have to take account of general law considerations when exercising their powers to dismiss a chief constable. It is not a matter for the regulations but it might be one for the guidance that I hope will be given to PCCs on this matter. Indeed, I would strongly advise the Minister’s department to look seriously at the advice and training or development to be given to PCCs on these matters. On that, I assume that there will be some development programmes for the newly elected PCCs. I would certainly put that proposal forward to be considered.
Turning to the fees regulations, these look straightforward. The opportunity to debate the issue of working dogs’ tails with the noble Lord, with his vast experience of such matters, and with his fellow Defra Ministers from past years would be invigorating, but I shall desist. However, I want to ask him about the financial code. A draft code has clearly been circulated round the usual bodies that comment on police matters. My understanding is that a final agreed version is not yet available, but that the work on the drafting has identified a number of challenges. The real issue here is the introduction of two corporates sole, the chief constable and the police and crime commissioner. The audit and all financial matters are unduly and unnecessarily complicated because of that structure. If there is any information that the noble Lord could give me, I would be grateful.
Baroness Hamwee
Like the noble Lord, Lord Hunt, I resist entering into a debate on working dogs’ tails, although it was the very point that I marked when I first read the regulations. I will not repeat questions that he asked that arise from concerns expressed by the Association of Police Authorities, save about a couple of matters, one of which is to ask about updated information on what I would describe as interlocking regulations; they may not formally interlock, but in practical terms they will.
The noble Lord, Lord Hunt, talked about politics being played with in complaints. It is not always the subject of a complaint who has played politics; quite often the complainant uses procedures to play politics.
It is not directly a subject of the statutory instruments, but closely related is the proposed funding of police and crime panels. I have heard concerns that the funding will be very low indeed, only enough for one member of staff and perhaps four meetings a year. These regulations are, one hopes, only a small part of the remit of the police and crime panels, which need to be funded—not extravagantly, but adequately and appropriately. The legislation gives them a wider remit than just complaints.
Thinking about that made me wonder whether that was why, in the consultation process, it was proposed that the police and crime panel should be able to delegate to the chief executive of the police and crime commissioner; the noble Lord, Lord Hunt, has already referred to that. I am a bit uneasy, not because of the point about impartiality or objectivity which the APA has raised, but because it seems to confuse the roles of the two entities.
Nor am I immediately convinced about using the local code of conduct in the case of the Mayor’s Office for Policing and Crime and the deputy if the deputy is an Assembly Member, because of their own role in creating that local code. That raises some quite interesting issues. We do not really know where we are with codes and local government yet. I asked one of my colleagues who is still a councillor, and he says that a lot of consultation is going on, but of course these are to be local decisions, even if local authorities adopt the same or a similar standard.
I also want to ask about Regulation 26(4) of the complaints and misconduct regulations; this is a detail, I know.
I was interested that the IPCC will be able to take a view as to whether what is a possible criminal offence is “appropriate”—that is the word—to be considered by the Director of Public Prosecutions. I am sorry that I gave the Minister so very little notice of this matter. As I have said to him, I only managed to look at these regulations at lunchtime. But it seems rather odd to put that power in the hands of the IPCC.
I am interested that the regulations modify Section 22 of the 2002 Act. They seem to do little more than substitute the dramatis personae. As now, the Secretary of State’s approval will be required for commission guidance but, as far as I can see, the power for the Secretary of State herself to issue guidance is new. It may be that the 2011 Act has allowed for this. I would just pause on regulations adding that right for the Secretary of State—not that you could ever stop a Secretary of State issuing guidance—but it might affect the status of the guidance. I do not know whether the Minister will be able to answer my question, which, in effect, is: is there a substantive change brought about in this by the regulations?
Lord Henley
My Lords, I am grateful to both noble Lords for making clear that they do not want me to go any further on working dogs’ tails and we will leave that for another day. Perhaps I may start by making a brief reference to my noble friend Lady Browning who, after all, took the Police Reform and Social Responsibility Act through Parliament. She completed that before she stood down, at which point I moved to the Home Office, and we are very grateful to her for all that she did. I think that the noble Lord, Lord Hunt, is mistaken in describing that Act, which is now on the statute book, as being misguided. As I have made clear, it is now a done deal and Parliament, as I have said, has spoken.
The noble Lord also complained about the rush that is taking place. I do not believe that there is a rush. Obviously, things are marginally tighter for London where things happen faster than in the rest of the country, but the rest of the country has until 22 November 2012. I am sure that it—and the Met—will cope. Certainly, we have had no expressions of concern from the Met about that.
The noble Lord also asked about training programmes and what we are going to do to get the PCCs into the right position for when they are set up, which is obviously of very great concern to my right honourable friend, Nick Herbert, the Minister with responsibility for policing and crime. He chairs a transition board, which includes all the key parties, including the chief executives of police authorities. I assure the noble Lord that everyone involved will be included. My right honourable friend has got the message and he is making sure that something effective will be set up and that we have an efficient transition.
The noble Lord was also worried about the number of further instruments that will be needed to set up these regulations. I referred to a jigsaw and this is just a part of it. Not all of what is coming through will be statutory instruments that will need to go through this House, although some will be. In order to get the detail right, it would probably be best if I wrote to the noble Lord to give him a timetable to assist him in this matter.
He also spoke about the absence of any code of conduct, which was also raised by my noble friend Lady Hamwee. I must make absolutely clear that these bodies will be subject, as elected bodies, to all the noble principles by which we abide. That was clearly set out in the protocol. It is also obvious that they will possibly wish to establish certain locally designed meaningful codes of conduct which they think are appropriate for them. Again, that deals with one of the concerns of my noble friend.
The noble Lord was worried about the absence of any sanctions for dealing with police and crime commissioners. What he must remember is that they are democratically elected bodies. Ultimately, that is the sanction. That is why we brought them in and why we think they will do a good job. They will conduct their business in public, so transparency will be a key tool in how the public view them. I think that this will be a great improvement on the system we have at the moment.
Lord Hunt of Kings Heath
I am grateful to the noble Lord and I fully understand the point. Indeed, I remember that when the standards board came in in relation to local government, I thought that some of its earlier judgments were actually inhibiting the democratic process. In no way would I want, if you like, to encourage a bureaucratic process that interferes with the relationship between the elected police and crime commissioner and the electorate. The problem I have is that if the public think the informal resolution process is not very effective, they will be tempted to over-egg the pudding and go for a complaint that will have to be considered by the IPCC. If that happens, I worry that many police and crime commissioners are going to be held back because they could get a plethora of complaints like that. It suggests that there is a need to get the balance right and that we must ensure that the informal process has at least some potential for dealing with these matters effectively in order to prevent a kind of upgrading of complaints.
Lord Henley
I am glad that the noble Lord used the word “balance” because obviously that is the thing we have to get right. We believe that we have got it right and it is important that we ensure that the processes are in place. There is transparency and the democratic process which I think will be sufficient. If I am wrong in that and if, as the noble Lord puts it, there is a plethora of complaints, we would have to think again. However, I do not believe that that will be the case.
Perhaps I may move on to some of the other queries of the noble Lord. Having listened to the Association of Police Authorities, he worried about rude behaviour on the part of police and crime commissioners themselves, something he said was not unknown among elected politicians. However, I suppose that I am only a partially elected politician and the noble Lord is an appointed politician. We both know that this can and does happen occasionally, but I hope that it does not happen too often. Moreover, I am grateful to the noble Lord for his kind remarks. The important point to remember is that if any rude behaviour went so far as to be illegal, it would be something that the IPCC would have to deal with. If not, it would be something that quite rightly would go back to the police and crime panel itself.
I turn now to some of the more detailed points made by the noble Lord in relation to conflict of interest. I have to make it clear that we would leave it to the IPCC itself to decide if it was appropriate for the home force or another force to deal with the issue. Again, the IPCC is the right body to deal with this. The noble Lord went on to ask whether a police and crime commissioner’s monitoring officer would have a conflict of interest if he was handling a complaint against the PCC. I do not think that there is necessarily a conflict of interest. The police and crime panel can choose to delegate the handling of complaints to the PCC’s monitoring officer, but it does not have to do so.
The monitoring officer will only be responsible for the initial handling of complaints, not for their resolution. In many ways the arrangement reflects current police authority practice, where police authority staff handle complaints against members of staff.
The noble Lord then asked a fairly detailed question about staff complaints under paragraph 15(3)(a), I believe. I refer him to paragraph 15(3)(b). It does not take a complaint by a member of the PCC staff outside the scope of the regulations, and it allows but does not require the PCC to set aside the regulations. The PCC could decide that it would be proper to continue to deal with the complaint—for example, of bullying by the PCC. So that is something that they would be able to deal with.
Then there was the important question from my noble friend Lady Hamwee as to whether the level of resources would be adequate; my noble friend was very worried that they would not be. I can give her an assurance that I believe that they will be both adequate and appropriate. Police and crime panels will be resourced to perform their vital scrutiny function in relation to the PCC—including work and relation complaints. They will also be able to delegate the initial handling of complaints to the PCC’s monitoring officer, which I hope will minimise the administrative burden involved. They will retain responsibility for the informal resolution of complaints but will be able to delegate that task, where necessary, to a single panellist and a subgroup of the panel or any other individual and return matters to the full panel only where required.
Lastly, the noble Lord asked about the financial code. I can give him an assurance that it is being drafted with partners. We are confident that we have worked through the issues and that it will be produced at an appropriate stage. I cannot give a precise date at this point, so I will just say soon, which seems to encompass a vast range of time on this occasion.
I appreciate that I probably will not have dealt with all the more detailed questions, and I am certainly more than happy to write to both my noble friend and the noble Lord in due course to pick up some of those points. I do not believe that these are highly controversial regulations, so at this stage I hope that noble Lords are satisfied.
Local Policing Bodies (Consequential Amendments) Regulations 2011
(13 years ago)
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Lord Henley
That the Grand Committee do report the House that it has considered the Local Policing Bodies (Consequential Amendments) Regulations 2011.
Relevant document: 34th Report from the Joint Committee on Statutory Instruments
The Minister of State, Home Office (Lord Henley)
My Lords, I have already spoken to these regulations. I beg to move.
Accession (Immigration and Worker Authorisation) (Amendment) Regulations 2011
(13 years ago)
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Lord Henley
That the Grand Committee do report the House that it has considered the Accession (Immigration and Worker Authorisation) (Amendment) Regulations 2011.
Relevant document: 35th Report from the Joint Committee on Statutory Instruments
The Minister of State, Home Office (Lord Henley)
My Lords, I beg to move that these Regulations be now considered by the Grand Committee.
This is a slightly different subject and I shall set it out in a degree of detail. The Government announced on 23 November that transitional restrictions currently applied in respect of Bulgarian and Romanian nationals’ access to the labour market will be extended to the end of 2013. These regulations achieve that by extending the transitional period during which the current regulations apply until the end of 2013. The amending regulations make no other changes to the current regulations.
The context of the Government’s decision is that the terms of the treaty governing the accession of Bulgaria and Romania to the European Union provide for the existing member states, if they choose, to regulate access to their labour markets by nationals from the Republic of Bulgaria or Romania. This is a permitted derogation from the EU’s free movement rules. Such restrictions may be applied for up to a maximum of seven years, but may only be maintained beyond five years where there is, to use the words in the treaty,
“serious disturbance of the labour market, or the threat thereof”.
As noble Lords will know, the Government are committed to reducing net migration to the United Kingdom. It is of course the case that after 2013, Bulgarian and Romanian nationals will be free to enter the United Kingdom for the purpose of work in the same way as any other EU nationals. The free movement of workers within the EU is a fundamental element of the internal market and it is one that brings benefits to the United Kingdom, not least as an exporter of workers to other member states.
On the other hand, the United Kingdom experienced a very significant influx of workers from the new member states that joined the EU in May 2004. It has been sensible, both in the light of that experience and the changed economic circumstances, to take a more gradualist approach to subsequent accessions. The Government are clear that they will apply transitional restrictions to nationals of countries joining the EU in the future. Similarly, for as long as it remains legally possible and proportionate for the United Kingdom to apply transitional restrictions on Bulgarian and Romanian workers, and there is a compelling labour market case for doing so, it will be prudent for those restrictions to be maintained.
The United Kingdom has applied restrictions on Bulgarian and Romanian nationals’ access to the labour market since those countries joined the EU on 1 January 2007. Whereas nationals of those countries joining the EU in May 2004 were simply required to register their employment under the worker registration scheme, Bulgarian and Romanian nationals have been subject to more substantive restrictions on permission to take employment in the United Kingdom. Their effect is to preserve the level of access to the United Kingdom’s labour market which Bulgarian and Romanian nationals enjoyed when they joined the EU. The standstill clause in the treaty means that we cannot impose controls that are more restrictive than those that were in place on 31 December 2006.
Under the current regulations, Bulgarian and Romanian nationals are required to obtain authorisation from the UK Border Agency before they take employment in the United Kingdom. This will normally require the employer to apply for a work permit in respect of the job in question and such a permit will normally only be issued in respect of skilled employment and where resident labour is unavailable to fill the vacancy. Bulgarian and Romanian workers are also able to obtain authorisation to take lower-skilled employment in the agricultural and food processing sectors under the quota-limited seasonal agricultural workers scheme and sectors based scheme. As the terms of the derogation require, the requirement to obtain work authorisation ceases once a Bulgarian or Romanian worker has completed 12 months’ authorised employment in the United Kingdom. The regulations also provide for the most highly skilled to be granted free access to the labour market from the outset.
The effect of the current restrictions is that a Bulgarian or Romanian national who intends to take employment in the United Kingdom will have a right to reside as a worker only if they are working in accordance with these restrictions. However, the restrictions do not and cannot interfere with the ability of a Bulgarian or Romanian national to exercise a right to reside in the UK on some other basis; for example, as a student or for the purpose of engaging in business. What they do ensure is that labour migration from Bulgaria and Romania reflects the UK’s economic needs by restricting employment authorisations to skilled work or employment in sectors where there are well established shortages of labour. Furthermore, the numbers given permission to work under these arrangements have not increased since the date of accession. Excluding participants in the seasonal agricultural workers scheme, the number of Bulgarian and Romanian nationals issued with accession worker cards in 2010 was 2,616, compared with 2,776 in 2008 and 2,097 in 2007.
As I have noted, the United Kingdom can only maintain its existing restrictions in circumstances of serious labour market disturbance. The Government have been concerned to ensure that the question of whether there is a labour market case for extending the restrictions is examined fully. The Minister for Immigration and Citizenship therefore asked the independent Migration Advisory Committee to consider whether there is a serious disturbance to the United Kingdom’s labour market and whether maintaining the restrictions would assist in addressing that disturbance. The committee’s findings, which it published on 4 November, were clear. On the question of whether the labour market is seriously disturbed, it examined the performance of the labour market against a number of indicators and concluded that it was performing poorly relative to the period prior to the last recession. On that basis, it is in a state of serious disturbance. It went on to conclude that an increase in the inflow of Bulgarian and Romanian nationals could have negative impacts on the labour market, particularly if it coincided with a change in the composition of that inflow, and that lifting the current restrictions would increase that risk. On the composition of the inflow, a particular risk would be that lifting the restrictions might increase the number of Bulgarian and Romanian nationals entering lower skilled occupations where migrants are more likely to substitute for, rather than complement, the resident labour force.
The committee acknowledged that the extent to which maintaining restrictions would assist in addressing such disturbance is subject to considerable uncertainty and it would not be sensible to attempt to put a numerical range around the likely inflow if restrictions were lifted. The Government would be equally cautious of attempting to do so. Nevertheless, the conclusion to be drawn from the committee’s findings is that a decision to maintain the restrictions would be both justifiable under the derogation in the treaty on accession and a proportionate response to current labour market disturbance. Accordingly, the Government have decided that the restrictions should be maintained.
I should add that Germany and the Netherlands have recently announced that they will maintain their restrictions. Spain has recently reimposed restrictions and will maintain them until at least the end of 2012. This is significant and not just because it means that the United Kingdom is not out of step with key EU partners on this issue. As the Migration Advisory Committee pointed out in its response, the risk of greater inflows would be highest if the United Kingdom lifted its transitional measures but other member states maintained theirs. The Government’s decision has avoided that outcome.
The Government believe that extending the current restriction to the end of 2013 is proportionate and the right response to current labour market conditions. I therefore commend the measure to the House.
Lord Hunt of Kings Heath
My Lords, I am sure that the Grand Committee is grateful to the noble Lord for his extensive introduction to these regulations. I was particularly interested in the advice that he read out from the Migration Advisory Committee. He will be aware that when the extension was agreed beyond January 2009, the committee reported in a similar vein at that time and said the impact of lifting the restrictions would be small but that the risks to the labour market were mainly on the downside. That led it to recommend a cautious approach. I assume that the committee is continuing that advice on the basis of that same philosophy.
I take the point the noble Lord made that it is difficult to attach facts and figures to this measure but does he accept the committee’s assessment of its impact? I would be interested to know whether he can put any figure at all on the likely impact of extending the measure by a further two years. He will know that the Merits Committee rather took the Government to task as regards the laying of the regulations and made the point that they have had rather a long time to consider the extension but, by leaving it to the last moment, it will have to be put in place. In a sense we are legitimising that through the current process. The Merits Committee would have preferred the policy to have been agreed somewhat earlier, which would have allowed the regulations to be laid before Parliament in draft and be subject to approval by resolution of each House. Will the noble Lord comment on that? What is his response to the Merits Committee?
Baroness Hamwee
My Lords, on the point about the timing of the measure, is the Minister satisfied that individuals and employers will not experience any practical problems as a result of that? I cannot quite get my head round what practical steps need to be taken. Is it the case that an application has to be made for a new accession work authorisation document and that there may be individuals—this goes to the question of the noble Lord, Lord Hunt, about numbers—who might have expected that they could continue to work for the same employer in this country beyond the end of this year but will, in effect, be given a matter of a very few working days to apply for the authorisation? Perhaps it is not as few days as from now until the end of December as the regulations were made—oh no, the regulations come into force on 30 December. I am getting very confused about the dates. I suppose that the warning was there for the employers but the regulations will not be made until the day before they need to be in formal terms, but there may be practical implications for individuals caught up with this. I hope that I have made myself at least moderately clear. The Minister is nodding, so I am glad about that.
In applying the tests, which the Minister has told the Grand Committee are about both the labour market and skills, will there be any changes from those that have been applied? My other question was about other EU member states. The Minister told us what some states are doing, so are we to understand that, in effect, the other member states are all maintaining their own status quo apart from Spain, which is reimposing restrictions, so that there is no other change across the European Union? The point has already been made that this cannot be looked at in isolation.
Lord Henley
My Lords, I am grateful to the noble Lord, Lord Hunt, for referring to the Migration Advisory Committee and its work, on which we are very dependent. He then asked me to speculate how many individuals might come in if we did not seek this further two-year derogation. I do not think that it would be helpful to try to do so. I offer as a little warning some advice to the noble Lord. He might remember that the Government, of which he was a member when Poland and other countries acceded to the European Union, did not seek any derogation on that occasion. It was suggested that the numbers coming here would be very small indeed. I forget the figure, but as we saw, the numbers coming in were exceeded by a matter of 10 or a hundredfold. That is why the noble Lord’s Government were very keen in 2006, with the further accession of Romania and Bulgaria, to make sure that we did have proper controls on the numbers coming in. We obtained that derogation, which other countries also obtained, for five years that could then be extended for a further two years. I shall not speculate on the numbers because, as the noble Lord will remember, it is very easy to get them wrong and to do so by a factor of—let us say, X, but a big factor.
The noble Lord then went on to complain about the timing and mentioned the Merits Committee. I appreciate that we received some criticism, and my noble friend Lady Hamwee also mentioned those problems. I can say that I think many people will have known that this was likely to happen as we had the ability to extend the five years by two years, as long as we did so by the end of this year. We issued this SI on 23 November, which, as my noble friend Lady Hamwee knows, does not come into effect until the end of the year. The Migration Advisory Committee published its report somewhat earlier in the month so we all knew that it was coming, and most employers knew that it was coming. My noble friend had some concerns about the difficulties that some employers may have but I can assure her that any individual who is working for an existing employer will not require fresh authorisation if he stays with that employer. Obviously, there will be a difference if he moves. There will be no changes to the criteria for granting authorisation at all.
The final point was about other member states. Obviously, it is very important to look at what other member states do because that will affect how many people come in. As the noble Lord will remember, when Poland and others were coming into the EU, other member states sought a derogation for a number of years. We did not and that is probably one of the reasons why a very large number came here. On this occasion things have happened differently, and as I mentioned in my opening remarks, Germany and the Netherlands are both seeking a derogation and Spain seeks to extend its derogation. Different things are happening in different countries of Europe, which is a matter for them to decide. We have made our decision based on the advice from the Migration Advisory Committee, which took into account what was happening in other countries in Europe. I shall write to my noble friend to give further details of what other countries are doing if she would like that. The important thing is that we took their actions into account in our decision.
House of Lords
Royal Assent
Justice: Pre-trial Publicity
(13 years ago)
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Baroness Quin
To ask Her Majesty’s Government whether they are considering legislation to strengthen measures against pre-trial publicity which may prejudice a fair trial or undermine the principle of the presumption of innocence.
The Minister of State, Ministry of Justice (Lord McNally)
My Lords, there are no current plans to legislate. The Government referred the subject to the Law Commission in the summer and we will study with interest its conclusions in due course.
Baroness Quin
My Lords, this Question was prompted by the case of Mr Jefferies in particular. He recently gave evidence to the Leveson inquiry and described how, although innocent of any crime, he was vilified in the press to such an extent that he was in fear of his life. Any of us as citizens could imagine ourselves being caught in such circumstances simply by being linked through coincidence or circumstance to a crime. Although I welcome the fact that the Attorney-General has shown himself willing to prosecute in such cases, will the Government none the less look at amending, for example, the Contempt of Court Act so that action can be taken at an earlier stage rather than when havoc has already been wrought on innocent victims’ lives?
Lord McNally
My Lords, I think that the response to the noble Baroness’s question reflects concern in all parts of the House about this matter. There are a number of problems with the operation of the contempt laws which are set out in detail in the Law Commission’s Eleventh Programme. Since 1981, when the Contempt of Court Act was enacted, the world of publishing has evolved considerably in terms of technology and the structure of the media, and the internet is now a significant influence in this area. That is why we have referred the matter to the Law Commission. In no sense should this be taken as our kicking it into the long grass or as the Attorney-General not appreciating the real public concern about these matters.
Lord Thomas of Gresford
My Lords, some in the press take a gamble with pre-trial publicity that the suspect will be charged and convicted, after which there will, of course, be no proceedings. In the McCann and Jefferies cases, they then became completely contrite and settled the claims without any question. Should they not lose a day’s edition as a result of circumstances as bad as that? Can we not have measures that will really bite on the press when it goes astray?
Lord McNally
My Lords, my noble friend’s idea is an interesting one. I understand—just a thought—that an editor has not been sent to prison for contempt since 1948. The Attorney-General, who has been alive to this matter, said in a lecture at City University on 1 December that, in his opinion, the press has been pushing at the boundaries and in a sense has subtly been seeking guidance on what is acceptable. I hope that the Attorney-General’s action has given it suitable guidance that we take this matter very seriously.
Lord Morris of Aberavon
My Lords, while I am confident that the Attorney-General will keep a watchful eye on this issue and commence proceedings, as he has indicated, where necessary—as I had to do two or three times—I also wonder whether standards have deteriorated. Have there been discussions—should there be discussions—with the press generally to try to avoid prejudice long before contempt proceedings have to be contemplated?
Lord McNally
My Lords, I agree with the noble and learned former Attorney-General. At the City University lecture to which I referred, the Attorney-General said that it appeared to him that,
“the press had lost any sense of internal constraint and felt able, indeed entitled, to print what they wished, shielded by the right of ‘freedom of expression’ without any of the concomitant responsibilities”.
We are indeed making it clear to newspapers that the law exists in this area. As he has already demonstrated, the Attorney-General is willing to follow the example of his predecessor and take action under that law.
Lord Cormack
My Lords, it is not only the press which is to blame here; the police made no secret of the fact that they had arrested Mr Jefferies on suspicion of murder. Should there not be a prohibition on the police announcing that sort of arrest until someone is actually charged with an offence?
Lord McNally
Again, that is very sensible. One of the things that has come out of recent revelations is a perhaps unhealthy linkage between the press and the police in high-profile cases. The police themselves should be very concerned to observe all proprieties when dealing with such serious matters.
Lord Pannick
Will the Minister bear in mind that the Contempt of Court Act 1981 liberalised the law precisely because the previous law restricted newspapers from publicising matters of public interest, in particular scandals such as the thalidomide affair?
Lord McNally
My Lords, we are aware of that, and we are very concerned to make sure that we get the balance right. However, where the press’s desire to sensationalise actually jeopardises a case, either by prejudicing the case against an innocent man or, almost as bad, so prejudicing a case that someone who is guilty has to be released, it cannot be in the interests of justice.
Lord Richard
My Lords, the noble Lord has told us what the Government intend to do and I think that they are wise to involve the Law Commission in this matter. However, he will know, as we all do, that Parliament’s record in implementing the Law Commission’s reports is not exactly very good—it is not a speedy process. Will the noble Lord note, certainly from the mood of the House this afternoon, that if the Law Commission reports on this, the feeling would be that it is not a report that can hang around for two, three or four years before Parliament looks at it? The matter will need some urgency once they have had a look at it.
Lord McNally
I thank the noble Lord for his comments. I am the Minister responsible for liaison with the Law Commission. One of the things I said to Mr Justice Munby, the retiring head of the Law Commission, is that during my stewardship I would hope that we could remedy some of the faults that he indicated and that, certainly on this point, we would approach any Law Commission report with a due sense of urgency.
Baroness O'Neill of Bengarve
Does the Minister agree that one of the problems is that the media have confused their right of freedom of expression, which in the European convention contains many legitimate restrictions, with the rights of self-expression which we may accord to individuals without damage to others?
Lord McNally
I agree, but also the law is very clear. I tend to agree with the Attorney-General that the media have been pushing the envelope of the law to an extreme. That is why he is taking action.
Armed Forces: Housing
(13 years ago)
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Lord Wallace of Saltaire
My Lords, the majority of service family accommodation is already of a very good standard. In the United Kingdom, some 96 per cent of homes—that is 46,000 out of 49,000 homes—are at the top two standards out of four standards for condition, with more due to be upgraded to the top standards in this financial year. The MoD continues to target funding on the most pressing accommodation issues.
Lord Dubs
My Lords, I understand what the Minister says, but does he not agree that to bring all housing for families of servicemen up to the right standard is going to take about 20 years and that this is not good enough when families will come back from Germany and when our troops in Afghanistan are entitled to believe that all their families are adequately housed?
Lord Wallace of Saltaire
My Lords, I do not agree with that. Under the previous Government’s programme, the target for 2020 was for all service families’ accommodation to be at standard 1 level. I think they were confident that they would hit that target. As the noble Lord knows, we have now had to put into the advance budget of the MoD a pause in major upgrades for three years from 2013, which may make the 2020 target hard to hit. Minor upgrades, however, will continue. The vast majority of service accommodation will continue to be of a very high level.
Baroness Sharples
Will my noble friend tell us whether Wellington barracks, which I have visited twice in recent years, has now been brought up to scratch?
Lord Wallace of Saltaire
My Lords, I do not have that information. I promise to write to the noble Baroness.
Lord Dannatt
My Lords, is it not a great disappointment that over the past few years when extra funds were found for service family accommodation there now has to be a pause and that expectations which were raised are now going to be lowered? I accept that there is not the money for all the things that we would like to do, but when our soldiers, sailors, marines and airmen are heavily committed, it is a great disappointment not to be able to refurbish their houses to the timescale previously promised. Would the Minister not agree?
Lord Wallace of Saltaire
My Lords, we are talking about around 1,000 houses. We very much hope that serious problems will not arise during this three-year pause. We are doing everything that we can to avoid that problem. As the noble Lord will know, one in eight service houses turns over every year, because there is a considerable churn in Army housing in particular. That requires a constant programme of minor refurbishment, which will of course continue.
Lord Palmer of Childs Hill
During the passage of the Armed Forces Bill, I raised the dire state of forces housing. I suggested that we look to fill the gap by the greater use of housing associations in garrison towns. I did not really get an answer, but the Minister did at that time say that the upgrades since May 2010 of service housing personnel was 900 units. Can the Minister—bearing in mind his previous response about 2013—give a number of the houses that will be upgraded by the end of 2012?
Lord Wallace of Saltaire
My Lords, I understand that there will be another 500 to 800 houses to be upgraded next year. I add that not all service families are living in service family accommodation; part of the intention of the new employment model currently under negotiation is that fewer service families will have to move as regularly as before. More will therefore be able to invest in their own homes. I was, indeed, asking some of the doorkeepers about their service accommodation and service life, and I was interested to hear how many of them had loans through the services to buy their own houses.
Lord Touhig
My Lords, no sensible person would move into a house that they had not first looked at, yet for many service families the first time they see the accommodation that they have been allocated is the day they move in. Does the Minister agree that this is not the right way in which to treat our servicemen and their families? If he does, what are the Government doing about it?
Lord Wallace of Saltaire
My Lords, as the noble Lord will know, part of the problem has been the sheer number of moves that service families have been making, particularly in the Army. With the return of our forces from Germany and the changes in the forces structures that we are implementing, we hope that there will be less frequent and fewer rapid moves, which would enable service families to be consulted a good deal more widely.
Baroness Finlay of Llandaff
Can the Minister tell us how many of the service family houses are fitted with carbon monoxide alarms, given the danger of carbon monoxide poisoning, particularly in poorly maintained buildings? We know that some of these buildings are poorly maintained. If the family move in and put the heating straight on, that may be the night when they get carbon monoxide poisoning.
Lord Wallace of Saltaire
That is a very good question, and I will of course have to write to the noble Baroness about that. I do not have the accurate, detailed information.
Lord Brooke of Sutton Mandeville
My Lords, may I remark to my noble friend that my noble friend Lady Sharples asked a question about the Wellington barracks when we were in opposition? It has clearly therefore appeared on the screen of the Ministry of Defence. If the first Duke of Wellington was alive today, I shudder to think what he would have said if it had disappeared from the screen during his lifetime.
Lord Wallace of Saltaire
I shudder to think what service accommodation was like when the Duke of Wellington was a general.
Lord West of Spithead
My Lords, in furtherance of what the Minister said about people owning their own accommodation, it became very clear to us at the MoD that the benefits of people having their own homes were huge. Are the Government now ensuring that there are mechanisms in place to make it easier for our people to own their own homes if they need to, rather than investing in married quarters, which can be awfully expensive in comparison?
Lord Wallace of Saltaire
My Lords, I visited Sandhurst the other week, and noted that one of the first things that they had done there was to build houses for some of the staff, which they could buy. It is very much part of what is intended under the new employment model that this will make it easier for service staff to buy their own houses.
Business: Ethical Values
Lord Haskel
To ask Her Majesty’s Government whether their plan for growth includes steps to encourage shared ethical values and long-term stewardship in United Kingdom businesses.
The Parliamentary Under-Secretary of State, Department for Business, Innovation and Skills (Baroness Wilcox)
My Lords, the Chancellor's Autumn Statement reinforced the Government's commitment to deficit reduction and fairness, to rebalancing the economy away from one built on debt towards long-term sustainable growth for the safety and happiness of our people.
Lord Haskel
My Lords, last month the financial services sector was in trouble for mis-selling insurance to pensioners. Yesterday, your Lordships debated the excessive charges for payday loans. These are but the latest in a long list of ethical and moral failings of an industry that the Prime Minister says must be protected at the expense of Britain’s wider industrial interests. In view of this, will the Minister now insist that the governance and management of these financial businesses be linked to the values of the rest of us—for instance, by adopting the City Values Forum?
Baroness Wilcox
I have had exchanges with the noble Lord on a couple of the issues that he has referred to today, so I know how fresh this is in his mind. The Prime Minister has spoken about a new understanding between business and government, with Governments committing to pro-enterprise and business-friendly practices. But more than anything, he believes that Britain’s most successful businesses are those that invest in their people, communities and environment.
Every Business Commits is a new initiative taking place under our Government, to see whether we can get businesses to make a significant impact by improving skills and jobs, supporting communities and small and medium-sized enterprises and improving the quality of life and well-being for our people.
The Lord Bishop of Oxford
My Lords, economic growth must be for some people an end in itself but for many others it is actually a means to an end: a larger end of human happiness, the quality of life and a fairer society. How does the Minister propose that the Government will try to co-ordinate an approach to economic growth, which is important, that also contributes to a richer, more holistic goal of human and social well-being?
Baroness Wilcox
Of course I agree with the right reverend Prelate the Bishop of Oxford that growth is not an intrinsic goal but a pursuit in order to achieve other ends. In November a year ago, the Prime Minister asked the Office for National Statistics to devise a new way of measuring well-being in Britain. His goal, he said, was to start measuring our progress as a country, not just by how our economy is growing but by how our lives were improving; not just by our standard of living but by our quality of life. The well-being factors that it identified were: jobs, health and well-being and the environment. They mirror closely our priorities under Every Business Commits, the new initiative which I hope that the right reverend Prelate will follow carefully and advise me, if he thinks necessary, along the way.
Lord Phillips of Sudbury
My Lords, given that highly complex, voluminous regulation is meat and drink to City lawyers and accountants—for example, some of our largest public companies pay a trivial amount of tax by avoidance schemes of the utmost artificiality—might the time not have come to consider in principle legislation rather more like our common law principles, which are more difficult to evade?
Baroness Wilcox
In response to my noble friend Lord Phillips of Sudbury, the Government agree that principles-based regulation will be an appropriate approach in many cases. There are existing examples of principles-based regulation in a variety of areas, as I am sure he well knows, such as the UK Corporate Governance Code, which contains broad principles against which listed companies are required to report. However, we will continue to monitor this and I will continue to talk to him about it.
Lord Young of Norwood Green
My Lords, does the Minister agree that the high executive pay which the public at large find so objectionable is only one symptom of the real illness, which is the broken relationship between shareholders and managers? How are the Government going to repair this so that the values of shareholders are reflected in the decisions of management, including perhaps having an employee representative on remuneration committees?
Baroness Wilcox
The independent Kay review will be looking at these things, which we have previously discussed and debated. I do not think any of us like to see the distance between remunerations growing wider and wider. There is no doubt that the Government are following this up.
Lord Sutherland of Houndwood
My Lords, David Hume argued that greed, which he defined as an avidity to acquire possessions, belongings, property and money, was a force destructive of modern society. Could he possibly be right and, if so, what shall we do about it?
Baroness Wilcox
Well, my Lords, greed was of course only one of the seven deadly sins. If I reflect on some of the others, I can see that they can be just as contagious and nasty. However, I shall reflect on the fact that one of my favourite poets, Kipling, wrote a wonderful poem called Norman and Saxon in which he describes how the people of this land will put up with pretty well anything at all, but they will not put up with the fear of unfair dealing. If we look for fair dealing in the relationship between the Government, their people and our business community, we should get somewhere.
Lord Tebbit
My Lords, does my noble friend not agree that the best way of asserting the rights of the owners of a business, as opposed to the hired help—men like “Fred the Shred”—would be if some of them were put on trial for falsifying the accounts of the businesses which they ran? They either knew or ought to have known that the accounts and the balance sheets that they brought forward were false.
Baroness Wilcox
We know that the shareholders hold the power in this country’s large corporations, and if they will, please, use it to call the people in those companies to account, we should see some movement. That is what we are encouraging.
National Institute for Health and Clinical Excellence
(13 years ago)
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Lord Naseby
To ask Her Majesty’s Government what, if any, changes there will be in the procedures of the National Institute for Health and Clinical Excellence as a result of the recent life sciences Statement.
The Parliamentary Under-Secretary of State, Department of Health (Earl Howe)
My Lords, the Government’s Statement on the life sciences set out a range of actions to support the adoption and diffusion of innovation in the NHS. This includes a commitment to establish, through the National Institute for Health and Clinical Excellence, an advice service to support medical technology companies in demonstrating the value of their products, and measures to improve NHS compliance with NICE guidance. It is for NICE to consider any changes to its procedures as a result.
Lord Naseby
Is my noble friend aware how welcome the Statement on life sciences was both to patients who suffer from chronic diseases and indeed to the pharmaceutical industry? However, that welcome is tempered by the statement that my noble friend has just made, because, quite frankly, NICE is and has been a dead hand on development for many medicines. I note that the current chairman has been in position for 12 years, and is scheduled to stay for another two, while the chief executive has been there for 12 years, and is scheduled for an unlimited term beyond that. Many charities have commented on NICE, and I will quote briefly from Sarcoma UK: “In the UK the delays caused by NICE can add years to introduction and mean patients die waiting”. Against that background, will my noble friend ensure that NICE has a new, younger and more modern management?
Earl Howe
My Lords, I need to put on record that I have every confidence in the senior leadership of NICE. The current chair and chief executive have overseen NICE’s development into an organisation of global repute that provides robust, independent guidance on a range of issues. Continuity of leadership can be a very good thing, and I believe that it is in this case, where the leadership is of the highest calibre. I would also say that significant improvements have been made to the timeliness of NICE appraisal guidance on new drugs. NICE is now able to issue draft or final guidance for a significant majority of the drugs that it appraises within six months of a drug being licensed. That is extremely good, considering the complexity of some of these assessments.
Lord Walton of Detchant
My Lords, does the Minister accept that the Statement by the Government last week on life sciences is one of the most welcome Statements relating to the life sciences that we have heard in this Chamber for many years? NICE has had a very proud record. It is required not only to assess the value and importance in medicine of drugs and new procedures but to consider their cost effectiveness. While there are certain situations in which it can rightly be criticised, it has made an immense contribution to the development of new procedures and the introduction of new drugs in the NHS. It is actually envied in other countries, not least in the United States, which wishes that it had a similar mechanism.
Earl Howe
My Lords, I fully agree with the noble Lord, who puts the case very well. That is why NICE will be at the heart of our work to improve quality in the NHS. We are re-establishing it, as the noble Lord knows, in the Health and Social Care Bill, extending its role to social care and embedding the role of NICE quality standards in statute. Of course, it will still be there to provide independent advice to support clinicians in the way that we know it has over the last few years.
Baroness Sharp of Guildford
My Lords, the White Paper talks about establishing a NICE implementation collaborative. Could the Minister explain to the House precisely what is meant by this?
Earl Howe
My Lords, the NICE implementation collaborative is a collaboration between NICE and representatives or stakeholder groups, including the chief pharmaceutical officer, the main industry bodies, the NHS Confederation, the Clinical Commissioning Coalition, the Royal Colleges and, if Parliament approves, the NHS Commissioning Board. The idea is that its members are going to work together to identify where support is needed and to identify solutions for the NHS through the development of implementation guidance—in other words, to improve the uptake of new and innovative technologies in the NHS.
Baroness Thornton
My Lords, the noble Lord, Lord Naseby, has never really liked NICE very much, so I am not surprised at his Question. A lot of the work of NICE is not about approving new medicines but about care pathways. I invite the noble Lord, Lord Naseby, to look at its last 10 press releases; they are all about how you treat COPD or HIV, the care pathways for people with mental illness and so on. Will the Minister confirm that NICE’s guidelines on care pathways will have the same effect under the new architecture as they have today?
Earl Howe
My Lords, our expectation is that the NHS will continue to use NICE clinical guidelines to inform local improvement activity. These guidelines are tremendously valued and very authoritative. The noble Baroness is quite right: they have the potential to make a big impact on the quality of care and to add value.
Baroness Masham of Ilton
My Lords, does the Minister agree that the Statement was very encouraging? Will it keep pharmaceuticals and more research here in the UK? That would be welcome.
Earl Howe
My Lords, part of the objective of the growth strategy is to break down some of the barriers that undoubtedly exist to pharmaceutical companies conducting clinical trials in this country. There have been unwelcome delays in the system and we are putting in place several measures to get rid of them, which in turn should encourage pharmaceutical companies to view the UK as the platform of choice for clinical research.
Financial Restrictions (Iran) Order 2011
(13 years ago)
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Lord Sassoon
That the order laid before the House on 21 November be approved.
Relevant document: 34th Report from the Joint Committee on Statutory Instruments, considered in Grand Committee on 12 December.
European Union Membership (Economic Implications) Bill [HL]
Lord Pearson of Rannoch
My Lords, I understand that no amendments have been set down to the Bill and that no noble Lord has indicated a wish to move a manuscript amendment or to speak in Committee. Unless any noble Lord objects, therefore, I beg to move.
Welfare Reform Bill
(13 years ago)
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17:09 - Division on Amendment 12 - Ayes: 258 / Noes: 190 - Amendment 12 agreed.
Lord Best
My Lords, I am speaking to Amendments 12, 14 and 49. I know that amendments to my amendments have been put down and I will say a few words about them. I understand—I hope this is the correct procedure—that my Amendment 14, as amended, is consequential on Amendment 12. It is Amendment 12 that I shall concentrate on now.
These amendments cover the new underoccupation penalty for council and housing association tenants, the so-called bedroom tax for those on housing benefit. I am very grateful to the noble Baroness, Lady Hollis of Heigham, for her support, and to the noble Lord, Lord Kirkwood of Kirkhope, and the right reverend Prelate the Bishop of Ripon and Leeds, for theirs. Since the noble Lord, Lord Newton of Braintree, asked for his name to be added to the list, although of course only four are allowed, I know the amendment has support across all of your Lordships’ Benches. The amendment also comes with the backing of an impressive list of concerned charities and voluntary bodies led by the National Housing Federation and Shelter, to which I am very grateful for their hard work.
The amendment seeks to prevent a change to the definition of underoccupation currently used by the Department for Communities and Local Government. The Bill paves the way for a much tougher test than at present, with a hefty underoccupation penalty—a cut to the housing benefit—for those whose accommodation fails the new test. Currently, as the Housing Minister Grant Shapps made clear in October, a household in council housing or a housing association home is deemed to be underoccupying only if it has two or more bedrooms above the basic bedroom standard. One spare room is permitted. Under the Department for Work and Pensions’ proposed new definition, one so-called spare room would not be allowed.
Under the fierce new test, a family would be counted as underoccupying if, for example, two teenage girls were not sharing the same room, or if an older couple, one of whom is below pension age, have a two-bedroom flat. All those deemed to be underoccupying will have to move and downsize to somewhere smaller. If they do not, even if there is simply nowhere smaller for them to move to, then they must pay the new penalty. Six hundred and seventy thousand households receiving housing benefit will be caught in this trap, rising to some 740,000 in the years ahead. If they do not move out, they will be charged an average of £13 per week, which will have to come out of their low earnings or their other benefits, which are meant to cover food, fuel, clothing, and specifically not housing. These are by definition very poor households, and the new tax will represent a significant reduction in their living standards.
This may sound a heartless measure, but the Government’s objectives are not dishonourable. The intentions are to reduce the high cost of housing benefit in respect of tenants who stay put, or to free up bedrooms for larger households where existing tenants are persuaded by the new penalty to downsize. I fear that neither of these perfectly understandable objectives will be achieved by this measure.
First, it seems improbable that this will raise tens of millions of pounds. Those deemed to be underoccupying who seek smaller homes as a consequence may well have to move into the private sector, where rents, and therefore housing benefit, will be much higher, costing the DWP an extra £50, £60 or more a week. Secondly, the savings for the DWP will often translate directly into costs imposed on councils and housing associations. These bodies will have to assume the role of tax collectors, extracting the average £13 per week penalty from each tenant who does not move, which will prove to be an administrative and financial nightmare. To see who should be sharing a room, a landlord will need to keep track of the age and gender of each child. They will need to measure the bedrooms to see whether they can fit in two beds. They will need to find out whether family members are living at home or have actually moved out. It will require an army of snoopers to see who must be deemed to have a spare room.
If tenants will not pay or cannot pay, the saving to the DWP simply becomes a cost to the council or the housing association in arrears and bad debts. Less money for social landlords means fewer improvements, fewer regeneration schemes, and fewer much-needed new homes. Since the underoccupancy issue is a much more significant one in the north, affecting 46 per cent of working-age tenants in the north-east, and 43 per cent in the north-west, this tax takes money out of local economies in places that most need it. In Bradford, for example, one of the big housing associations has calculated that if it cannot collect all the payments, and has to take the hit in lost rent, it will cost £2.7 million per annum, which it can ill afford. That excludes the heavy cost of evictions—pointless evictions, since so often there will be nowhere cheaper for the household to move to—wherever the landlord cannot keep tolerating rising arrears.
Lord McKenzie of Luton
My Lords, I will speak to Amendments 14ZZA and 49A, which are in this group and are amendments to Amendments 14 and 49. I start with an apology to noble Lords for tabling these amendments somewhat late. We thought, on reflection, that it was appropriate to import into the proposition of the noble Lord, Lord Best, the circumstances in which a local housing authority or registered provider of social housing is able to make a suitable alternative offer to somebody who is underoccupying social housing. I am pleased that the noble Lord felt able to signify his acceptance of that.
The presumption would be that such an offer would be taken up. In these circumstances a tenant could not rely on the spare bedroom to avoid an underoccupation charge—or tax, as it is more appropriately called. In that respect it would be consistent with Amendment 17A, tabled in my name and those of my noble friends Lady Hayter and Lady Hollis. However, the amendments would not disturb the basic proposition in the amendments of the noble Lord, Lord Best, so that where there is no suitable alternative offer the DCLG definition of underoccupation should be used, and the tax would not apply unless there was more than one spare bedroom. We support this.
Our amendment leaves the definition of what constitutes a suitable alternative offer to regulations—the same formulation we have used in Amendment 17A. It raises questions of how and by whom the determination is to be made, but these practical issues should not be insurmountable and may be dealt with in regulation. The definition would carry the implication that suitability should reflect the broad needs of the actual tenant in terms of size, location, extent of adaptation, proximity to transport and relevant support facilities. It should recognise that it would not, in all circumstances, have to be bedroom standard plus one, and would not carry any implications that RSLs or local housing authorities would have to manage their housing stock in any particular manner, although tackling underoccupation should clearly be a key part of the strategy.
No one doubts that underoccupation is a problem. We have a chronic shortage of housing stock and a huge demand for affordable housing. Yet the Government’s policy is the wrong way to go about tackling the problem, as it punishes people for housing choices over which they have little control rather than enabling the best fit between the available properties and the needs of households. We have heard that this measure will encourage tenants to make the same choices about their housing as those in the private sector or those who own their own home. Social tenants are, however, the group least likely to be underoccupying their property using the standard DCLG definition. Eleven per cent of social renters, or 429,000 households, have two or more spare bedrooms above the bedroom standard and approximately half of these are pensioners. In comparison, 47 per cent of owner-occupiers and 16 per cent of private renters have at least two bedrooms over the standard. Social tenants are, therefore, much more likely than other households to be living in a property which is considered to be the right size. It seems that the Government are intent on strengthening this disparity. Under the reinvigorated right-to-buy provisions, there is nothing to stop tenants who underoccupy from buying their property at the full, relevant discount.
These matters depend on whether an additional bedroom is fairly described as spare. This implies that it is surplus to requirements but, as we have heard from the noble Lord, Lord Best, for many it is not. The Housing Futures Network survey shows just some of the uses to which such an additional room might be put. These include a couple sleeping apart for medical purposes, storage of equipment—especially medical equipment—occasional use by overnight carers and many more which the noble Lord, Lord Best, instanced. We know that the vast majority of tenants do not recognise that they are underoccupying their homes at all. This is a reflection of space standards confirmed in the national figures on occupation. The DWP definition is out of kilter with what has become the norm for reasonable occupation in England. There also appears to be a huge administrative advantage in recognising the flexibility of the additional room. Without it, there is the risk of tenants having to constantly report changes of circumstances such as the son or daughter returning from university, somebody returning home because they have been made redundant and are struggling with their rent and the onset of an illness or infection with requires a couple to sleep apart. Are we really going to make these routinely reportable events?
The Government have also suggested that a further aim of the policy is to increase work incentives. Claimants who are underoccupying and who cannot move will be expected to find, on average, £13 a week to meet the shortfall in their rent. The DWP impact assessment suggests that they may do so by moving into employment or increasing their hours—even in the current circumstances, even with the current unemployment figures. Given that the whole aim of universal credit is to make work pay, it seems unclear why this additional work incentive is needed. Even if it does force some people to move into work, they are likely to be outnumbered by those who will move into debt.
In Committee, the Minister cited research by the Housing Futures Network, a coalition of four housing associations, which had interviewed 452 of their residents who would be affected by the underoccupation penalty. The survey found that 29 per cent of these would consider a move into work, but also found that 52 per cent would find it “very difficult” or “fairly difficult” to make up the shortfall in housing benefit. More than a third of those surveyed said that they were “very likely” or “quite likely” to move into arrears. The department’s own assessment notes the possibility of arrears, noting that the cost to social landlords of implementing this policy will include the cost to run schemes to enable affected tenants in the social rented sector to move home within the sector. The assessment also noted that the costs of action taken in relation to tenants failed to make up the shortfall between the rent and their housing benefit entitlement.
The third rationale given for the policy is the need to reduce expenditure on housing benefit. The equality impact assessment states:
“The overall cost of Housing Benefit needs to be controlled, and reduced in order to tackle the budget deficit. This measure is part of the effort to rein in Housing Benefit expenditure”.
However, the impact assessment is also clear that these savings will be made only if the first intention of the policy, to encourage people to occupy more suitably sized housing, actually fails. The impact assessment states:
“Estimates of Housing Benefit savings are based upon the current profile of tenants in the social rented sector, with little tenant mobility assumed. If a significant number of tenants wished to move, this would reduce direct savings and place extra demands on social landlords … If all existing social sector tenants wished to move to accommodation of an appropriate size, there would be a mismatch between available accommodation and the needs of tenants”.
How perverse can a policy be, when structuring it to fail is an excuse for hitting 670,000 poor households? In this situation, where there is simply not enough accommodation available to ensure that everyone has a home of what the DWP considers to be the right size, tenants will be left with no choice but to either take a hit to their incomes or move to the private rented sector, where the state will pick up the bill for the considerably higher rent that tenants are likely to face.
The people facing these choices are not likely to be able easily to absorb a £13-a-week hit on their income. The impact assessment shows that around 20 per cent of such families include a child under 16. The Housing Futures Network research found that more than 70 per cent of the households affected include someone with a disability or major health concern. The research also found that more than 40 per cent struggle to manage financially and more than two-thirds have an income of less than £150 a week, excluding benefits—meaning that they will have to spend around 10 per cent of their income to make up the rent shortfall.
The Minister has suggested that shortfalls might be met by discretionary housing payments, but there has been no indication that local authorities will be given extra resources to meet the cost. The impact assessment finds that the cost merely of administering these payments could reach £500,000. I ask the Minister: is there to be a top-up for this policy—a top-up to the pot that my noble friend Lady Lister in Committee called the “loaves and fishes” approach to funding?
The Government’s approach will therefore fail to deal with the problem of underoccupation while asking some of the poorest and most vulnerable people to pick up the tab for this failure. We would expect a more rational approach to the problem of underoccupation that encourages local authorities to prepare a strategy to address the issues of occupation and enables them to encourage people to move, but only where suitable alternative accommodation is available.
We know that good policy and the right incentives can enable a better fit between people’s housing needs and the available accommodation. Some people do want to downsize. The Housing Futures Network found that 12 per cent of those surveyed said that their current accommodation was slightly too large for them, but that they needed help and support to downsize. Shelter cites the successful example of the Oldham programme that offers financial incentives and support with moving arrangements, which has freed up 130 family-size homes in 16 months. If it were possible to roll out this programme nationwide, Shelter estimates that about 45,000 homes could be freed up. Shelter emphasises that, to achieve that, local political will is needed as well as sufficient local resource.
To summarise, Amendment 14, as amended by our amendment, and our Amendment 17A would imply that people had to take up suitable accommodation when it was offered. Amendment 17A would prevent the underoccupation tax applying at all where there was no such offer, and Amendment 14 would allow the reduction in housing support—the tax—to operate where there was more than one spare bedroom.
The Government's approach aims to tackle underoccupation, but will not do so, and will save money only at the expense of some of the poorest families in the country. Where there is a suitable offer of alternative accommodation, it may be reasonable to ask families to move, but to enable that to happen, we need to ensure that local authorities are working to address underoccupation rather than punishing those families for failure to do so. We support the amendment moved by the noble Lord, Lord Best, and, clearly, our Amendment 17A.
The Lord Bishop of Ripon and Leeds
My Lords, I have added my name in support of the amendment of the noble Lord, Lord Best, because of my concern, and that of those of us on this Bench, for the needs of children as we pursue the move towards universal credit. I am fully aware that that concern is felt on the government Front Bench as well.
This is an area where a small change to the Bill will bring about help for a significant number of children who are under the most pressure in social housing. What is proposed by the noble Lord in the amendment—whether or not it is itself amended—is a definition of underoccupancy in line with that of Communities and Local Government and which simply reflects the reality of family life. Under the definitions of the Bill, a family with an eight year-old boy and a nine year-old girl in separate bedrooms would be deemed to be underoccupied. That cannot make sense.
There is every reason to discourage genuine underoccupancy. When people think about underoccupancy, on the whole, they think of where a single person or a couple are left in a larger house, probably because their children have moved away. Surely that should not apply to a disabled child, for example, who needs care during the night and therefore needs a separate room. It should not apply to a room used for access visits by children following marital breakdown. It should certainly not apply to foster carers between placements. There is real concern that the Bill, if unamended, will discourage foster caring because the carers will not be able to retain rooms in which to place foster children if the need should arise.
We—or, at least, the Members on this Bench—are going to hear a good deal over the next fortnight or so about there being no room in the inn. The amendment will provide the flexibility so that families can live the sort of lives that most of us take for granted. I hope that we will be able to enable this to happen by the pursuit of this or a similar amendment.
Baroness Hollis of Heigham
My Lords, I declare an interest as chair of Broadland Housing Association. I am delighted to support this amended amendment. DCLG says that you are underoccupying if you have two or more spare bedrooms; DWP, in the Bill, if you have more than one spare bedroom—a very tight definition. If you then do not move to somewhere smaller, you will be fined by having your housing benefit cut by 15 per cent.
As my noble friend has said, this is not about finding homes for the 3 per cent of families who are overcrowded in this country. We could solve that tomorrow if we built bungalows or suitable flats for the pensioners who are queuing up for them—full stop. No, this is about cutting the housing benefit bill, by telling a third of our tenants in social housing, most of them disabled, that they have to find somewhere smaller to live. A middle-aged couple with health problems who therefore need that second bedroom will be entitled to only one bedroom. The family of four with two teenage daughters in a three-bedroomed home must move to a two-bedroomed home even though the girls will then have nowhere to do their homework. A disabled woman who sometimes has a carer staying overnight in her two-bedroomed flat must move to a one-bedroomed flat. A couple in their 50s, in a two-bedroomed house, who care for their grandchildren when their daughter with mental health problems cannot—in other words, they are occasional kinship carers—will have to move to a one-bedroomed flat, possibly some distance away, and the whole fragile family arrangement will collapse.
In theory, all the people in these examples are expected to move. The children are expected to change school one year before GCSEs, the middle-aged woman is expected to move away from her mother whom she is keeping out of residential care by her support, the disabled woman to move away from the friends who help her cope by doing her shopping and laundry. Six hundred and seventy thousand families—between 30 and 40 per cent of all tenants in social housing, two-thirds of them with a degree of disability—are supposed to go on the move if they can. Fine, if they can; but for most, even if they want to downsize, they cannot. Even though they may be pensioners who cannot heat their homes, they cannot downsize, and the DWP knows it. The smaller flats are simply not there to move to and all the fulminations of the tabloid press—that Ministers expect them to downsize when the same Ministers know that they cannot—are therefore cruelly irrelevant.
The National Housing Federation says that 180,000 households in two-bedroomed flats would have needed a one-bedroomed flat last year, but just 68,000 such flats—about a third of the number needed—became vacant. In future, the needs of pensioners who really want to move can never be met because, as the noble Lord, Lord Best, said, absolutely rightly, any smaller place that becomes available will have to be offered to much larger families who, however, do not want to move, rather than to the single pensioner who does. It is a cruel nonsense.
The department admits that, in its own words, there is a mismatch, and that the smaller properties that people are expected to move to do not exist. The department expects that 85 per cent of all of these tenants will stay put and take the cut in housing benefit because they have no alternative, as the impact assessment admits at the bottom of page 2. The Government are counting on people not moving, despite telling them that they should. So the Government’s savings are going to come not because people do what the Government tell them to do, but because people do not do what the Government tell them to do: they stay put, because they have no option, and then they are fined for doing so.
What do the Government suggest that they should do to cover the shortfall? They should find work. Well, of course, if they could they would, and we welcome the support given for finding work within the universal credit system. Alternatively, it is suggested that they could take a lodger; but with small children I do not think that that will happen. The other suggestion is that they use—actually, use up—their savings. As the noble Lord, Lord Freud, reminded us on Monday, the average savings are only £300. That will last for four or five months of shortfall. After that, what then? It will be debts, arrears and pass-the-parcel. To pay the council tax, because their council tax benefit is being cut by 20 per cent, they will raid their housing benefit. However, that now does not pay the rent, so to pay that, they will fall behind on their utility bills, which are also on the rise. Threatened with their gas and electricity being cut off in winter, they will cut back on food, until ultimately the whole Ponzi debt pyramid created by this clause of the Bill will collapse. They will then face food parcels and eviction.
However, as the eviction is not their fault, as the Minister agreed in Committee, they will not be intentionally homeless, so they will be put into highly expensive B&B at taxpayers’ expense with all its cost and all its misery, as, with a history of arrears, they will not be accepted by any private landlord. In time, they will be rehoused—quite probably, if my housing association is anything to go by, in a house that is still too large, because that is all we have—and the whole vicious spiral one year on will start all over again, taking disabled adults and children through a relentless cycle of cuts and evictions.
The alternative, of course, is that housing associations such as mine carry the arrears because we know the social and financial costs of eviction and the awful stress that it involves. Then what? Over time, the housing association goes into the red or, alternatively, we stop building and save the debt charges on erecting new homes, the money being spent instead on debts that come from cuts in housing benefit, thus guaranteeing that the shortage of social housing that is undermining the housing market continues for the next decade.
It is so unfair. Let us take JSA as an example. If people break the rules on job search, we cut their benefit to change their behaviour. However, if they observe the rules and, after a proper job search, cannot find a job given the unemployment figures, we do not cut their benefit because it is not their fault and they cannot change their behaviour. That is the social contract of social security. You sanction people when they break the rules and should change their behaviour; you do not sanction or fine them but support them when that is not possible. It is what we do with JSA. The DWP is, in this clause, breaking that social contract with these changes to housing benefit. In all my time in the social security field, I have never known that contract to be broken in this way.
Grant Shapps said that we should not bully people out of their homes. He is right. Yet in this Bill we are saying to people who have lived in their homes all their lives, done what was asked of them and behaved responsibly—two-thirds of them having some disability—that their benefit is being cut from underneath them through no fault of their own but just because we in Westminster are changing the rules. We tell them to downsize while knowing that they cannot do so, so we fine them instead for what is not their fault and for what they cannot change. It is morally wrong to punish people for something that is not their fault and to punish them when they are innocent. That is not decent, it is profoundly unfair, and we should not do it. If noble Lords agree, they will support the amendment today.
Lord Kirkwood of Kirkhope
My Lords, I speak as someone who supported Amendment 14, and I am very happy to agree to the composite that the noble Lord, Lord Best, has now accepted and put to the House. I think that it is one of the most significant amendments in the whole of the Report stage. I am now speaking to my own side of the House because I support this amendment very strongly. If the noble Lord, Lord Best, feels the need to press this to a Division, I shall support him, and I shall do so for a couple of reasons.
First, it is important to reassure people on my own side that this proposal would not interfere with universal credit, the introduction thereof or anything thereby, but it would mitigate some of what I call the Treasury claw-back—that is, the money that was required of the department to set up the universal credit system. I do not think that that is an easy thing for the department to do but, for me, it goes too far. It is claiming back too much money too quickly from too vulnerable a client cohort, and that is something that colleagues on this side of the House need to bear in mind.
At the risk of embarrassing the noble Lord, Lord Best, I point out that he has been active in housing for longer than any of us care to remember and is an acknowledged expert. The noble Baroness, Lady Hollis, and the right reverend Prelate are experts in their own fields. I have had some experience myself as a former chairman of the Social Security Select Committee in another place, and I am telling the House that today we are looking at a qualitatively different sort of cut.
Secondly—seen from the perspective of the summer of 2010, when this deal was done with the Treasury—it was not unreasonable to start looking for the green shoots of a recovering economy by 2013 to 2014. I am no economist but I think that there is no prospect whatever of that happening, as the Office for Budget Responsibility has recently confirmed. I think that we are facing dire prospects. If we are facing a 13 to 15 per cent cut in our national wealth then people like me will be able to accommodate that, but people at the bottom of the financial pile will not. Were the assessment of summer 2010 made today it could not, in all conscience, extend to the level of reducing household incomes in the social rented sector by £676 annually. That is not fair. This does not affect the implementation of universal credit; it is an attempt to claw back money for the Treasury.
Lord Wigley
My Lords, I rise to speak in support of Amendment 12, indeed Amendment 14 as it was, and other amendments. If some of these amendments are not passed, there will most certainly need to be exemptions built in somehow or other, as the noble Lord, Lord Kirkwood, said a moment ago, or a lot of vulnerable people are going to suffer. I am concerned about the impact of the Government’s proposals in relation to underoccupancy as they affect disabled people, including, particularly, those with learning disabilities. The Government will already be aware of concerns from the representations that have been made by Mencap —the noble Lord, Lord Rix, apologises that he cannot be here today. Numerous other organisations with an interest in this issue have also pressed the point that there is already a large shortage of suitably sized properties available to people who would under the new rules be deemed to be underoccupying their homes.
Furthermore, representations have also been made that there are around 100,000 properties that have been adapted specifically to suit the needs of the individuals living in them who would be affected by the new rules, meaning that should the occupiers have to move, new adaptations would have to be paid for, which seems a rather less than sensible outcome.
People with a learning disability regarded as underoccupying their home in the social rented sector will lose some of their housing benefit and have to make up the shortfall themselves. If they are unable to afford this, they will have no choice but to move to a different home. Very often, people with a learning disability will have established strong networks of friends locally, as well as family and support staff, and may not be in a position to adapt to the stress and anxiety of moving to a new home. The greater the distance from these networks, the greater the potential anxiety will be for them.
I am concerned that some disabled people will either face a reduction in their income or have no choice but to move home as a consequence of the Bill’s proposals. That is why I support the amendment.
Lord Newton of Braintree
My Lords, I apologise for once again coming in a bit late to the debate. On this occasion, I was at a meeting outside London and got badly held up by the demo currently taking place in Whitehall.
I should declare an indirect interest in that my wife, as I think most in the House know, is a cabinet member of Braintree District Council and has a strong interest in social housing matters. I nevertheless wish to speak because, had the right reverend Prelate the Bishop of Ripon and Leeds not pipped me at the post, my name would have been on this amendment. I strongly support it and agree particularly with the words that have been uttered by my noble friend Lord Kirkwood.
I am not in a position as a result of my lateness to repeat all the arguments of the noble Lord, Lord Best, because I have not heard them. I have no doubt that, had I heard them, I would have agreed with them, because I have discussed the matter with him on a number of occasions.
I simply want to bring a bit of information from the coalface, as opposed to the rarefied atmosphere of Whitehall policy discussions. I happen to have in my hand a note issued by Braintree District Council about the new rules on underoccupancy. It thinks that these have probably the most far-reaching policy impact of any of the changes in the Bill. It makes the point that it applies different, more generous rules than those that are nationally applied to tenants claiming housing benefit. It gives priority for a family to move when the oldest child is five years old or more, not 10, and it recognises that this policy of using the younger age of five will be wrecked by the Bill.
Similarly, it tries to rehouse people in advance of change, because of the delays that occur if they need a three-bedroom or four-bedroom house. I shall not quote the whole document, but it states that people are likely to wait for more than a year to move in the case of needing a four-bed property and a long time where they have children growing up. Let me quote just one sentence:
“We therefore felt that it was better that a family, for example, with a boy aged 8 and a girl aged 6 should move to a home with 3 bedrooms and not be allocated a 2 bed and have to move again shortly afterwards. We felt this was better for neighbourhoods, for children’s schooling and so on, as well as reducing the pressure on our allocations process”.
That makes complete social sense to me.
I say in passing, as another illustration of one of my concerns about government policy as a whole, that we have just passed a Localism Act purporting to give local authorities greater freedom to make this kind of choice, and we now seek to pass a Welfare Reform Act telling them that localism is neither here nor there—they will do what they are told by central government. Somebody might perhaps try to explain.
There are a number of other examples from the note that I could quote, but let me quote an additional note that should ring a bell at least on these Benches, about the rural effect. This was a subsequent note, which I happen to have in my hand, and it relates to a large village, which I shall not name, in the Braintree district. Greenfields—that is the housing association—gives details of what housing it has in this village and goes on to say:
“This is a good example of a location where potentially, people claiming benefit would be forced to leave if they could not afford the extra rent to stay in the family home. [The village] is interesting because it is a relatively big village with a high overall level of stock and yet the balance of homes makes this policy a real problem for people needing to downsize from a 3 bed to a 2 bed. Clearly, people in smaller villages”—
many rural—
“are likely to face even more acute problems if they need to downsize. Given that we come under pressure to give people a priority to stay in villages, the policy looks like it may achieve the opposite”.
The rural effects of this are not to be underestimated and my guess is that my noble friend’s colleagues in the Commons will face a barrage if and when this comes into effect. Indeed, I would venture to say that if this comes into effect less than two years before an election, with the impact that could be involved in some of the figures that have been discussed, it will not last five minutes when it starts.
Lord Stoneham of Droxford
My Lords, I declare an interest as chair of First Wessex Housing Association and Housing 21. I am pleased to speak in this debate initiated by the noble Lord, Lord Best. I think everyone in the House today understands the extreme pressure of the need to reduce the housing benefit budget and to tackle the issue of underoccupancy at a time of housing shortages. We should not forget that underoccupancy of social housing is nearly matched by 50 per cent overoccupancy.
In Committee, the Minister set an objective for the changes he was proposing. He said:
“Housing benefit … will become more balanced in a way that will restore fairness, encourage better use of our existing social housing stock and encourage more people into employment”.—[Official Report, 18/11/11; col. GC 71.]
The problem is that the market for social housing is not flexible; it is quite rigid. It is a fight to get a home and, in severe shortages, requirements and needs are not easily matched. We wish we had a situation where people could have a better choice, but it is simply not possible. What we have available in any locality is way short of need, and often what is available cannot specifically match need. On the issue of underoccupancy, we know that there will be something like 180,000 under retirement age who want to move but that the annual available housing for them is about one-third of this.
Housing requirements change through life. In a rigid market where people cannot easily match their requirements to supply, some flexibility is required. Otherwise, allocations will be even more difficult. The Minister’s objective—balance to restore fairness—will not be fair if an individual wants to move home and cannot. The person will have to find extra income and, in the current economic climate, as my noble friend Lord Kirkwood, said, it will be extremely dubious whether they will be able to find the significant extra income they need. Let us not forget that in this situation—my noble friend also referred to this—underoccupation is greater in the north, and so there is a regional dimension. Thirty pounds a week is a lot of money for people least able to afford it, and 150,000 households will have to find nearly twice that.
The Minister also said that one of the objectives is to provide balance to make better use of our existing stock, but the reality is that the existing rigidities will be distorted by this change. Available new housing stock will now have to be used to move people. The people who probably need the most encouragement to move are those who are retired—who are underoccupying—and we will not now have the facility to move them. They are the people whose household costs need to be reduced. Indeed, we improve the housing benefit bill by moving them. As the housing stock is re-let, we will be required under the Government’s housing benefit reforms to let some of these houses at affordable rents. So for those people who take on that stock, we will probably be paying out a higher proportion in housing benefit.
The Minister gave us, in his Committee speech, figures from the future network. Under the claimants benefit research, he said that of the 670,000, 25 per cent want to move; 50 per cent will not move; 29 per cent are looking for increased work and income—which is going to be difficult; 15 per cent say that they will take in a lodger, and 35 per cent are said to be likely to go into arrears. Those are pretty dramatic figures. He also said that over the next couple of years we will look at putting strategies in place to make sure that this does not happen. The problem is we only have 15 months in which to do this, not a couple of years, as the measure comes in in April 2013. That is madness.
We have already heard this referred to as a room tax. In fact, in Committee, somebody referred to the window tax. It was not in the time of Queen Anne, as the Minister mentioned; it was William and Mary—1696. I looked it up; two shillings per window. That is interesting; £11.20 in real money—it is not much different. I am assured also by the research that the phrase “daylight robbery” did not originate from that time. We can imagine, however, the political campaign—and the slogans—should this room tax come in on a single day. I do not fancy the Chancellor—I hope my colleagues will remember this—standing up in March 2013 to give his Budget speech when in April 2013 this change will be coming in. I bet you he will have to move politically at that time, even if he does not move now.
We have to expect that 25 per cent of people will move. How is this to be organised in 15 months? There are not enough houses being built to do this. Housing associations do not even know how many and who will be affected. There is a lack of information. What are the strategies? What must the Government do in this situation? What do they need to say today?
The first proposal is that of the noble Lord, Lord Best: allow an extra room for flexibility. It is probably the best proposal, but—as we will be told—this will take £300 million of the £500 million savings. It is not actually a great deal of money. I just ask the House to think what the Chancellor will be thinking in March 2013. It is not clear that the £300 million in savings will come through. I expect that a lot of children and other relatives will suddenly emerge in these houses. Re-lets, as I have already mentioned, would lead to higher housing benefit claims. There are also the costs of moving, plus the costs of discretionary housing grants, and so on. Retired people who we want to move into smaller accommodation—saving housing benefit and saving their household costs—will not be able to move.
The second proposal is to extend the transition so it coincides at a minimum with the anniversary of tenancies; that ideally, as the Minister has already said, we should spread this change over a couple of years so that people can adjust. If you are trying to take from the poorest people these sums of money, they need time to adjust. So do the housing associations and the housing providers. They need time to adjust to allow a better transition, to allow the adjustments in housing stock. We cannot expect everybody to simply change on day one in 15 months’ time.
The third option is to extend discretionary housing grants. We hear this on each occasion, but we are not sure how that is going to be administered.
I urge the Government to move on this issue, for sensible housing requirements, for fairness and for assuring that the poorest and the least resourced will not assume a significant burden at a very difficult time. Above all, the providers also need time and flexibility to adjust the housing supply to the new demands and the new needs.
Lord German
My Lords, I have two groups of people to whom I want to refer. My noble friend Lady Thomas referred to them in Committee, and I referred to one of them. What does the Minister anticipate doing for foster carers? We have already been told that we have a shortage of foster caring in this country, and foster carers need to keep a bedroom to be able to host and look after children in foster care. It is very important indeed—and I think that the Minister acknowledged this in his response in Committee—that something needs to be done to accommodate the needs of that group of people.
The second group of people are those who have had adaptations to their properties. Those adaptations probably cost the public purse quite substantial sums of money, so it does not make sense, for example, to require people to move from one property that has a stair lift to another where a stair lift has to be put in place. Can my noble friend tell us what he anticipates doing for both those groups?
The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Freud)
My Lords, I need to thank noble Lords to start with for a thoughtful and insightful debate.
The introduction of size criteria into the social rented sector from April 2013 is essential to reduce housing benefit expenditure, which without reform would reach £25 billion in cash terms by 2014-15. With savings from this measure estimated to be around £500 million per annum, it will play a key role in our efforts to control housing benefit expenditure and to tackle the budget deficit. In these difficult economic times, we cannot avoid having to make these choices. I assure noble Lords that these decisions have not been taken lightly.
In case there is any doubt, let me remind noble Lords that the size criteria measure will affect only working-age housing benefit claimants living in the social rented sector who are underoccupying their accommodation. For a family of four, with two adults and a teenage boy and girl, we are proposing that they will be entitled to housing benefit for a three-bedroom property with a living room, kitchen, bathroom and possibly even other rooms, such as an extra bathroom and study. This is the same as we allow for people living in the private rented sector. Those in a property that has more bedrooms than the size criteria allow will receive a percentage reduction in their eligible rent, meaning, on average, a shortfall of around £14 per week.
It is only fair that everyone plays their part, but we will, of course, ensure that we maintain safeguards for those in the most vulnerable circumstances. However, even with the reforms that we have started making to housing benefit, we are still expecting to spend nearly £23 billion on housing benefit this year. By the end of the spending review, we expect to achieve £2 billion in annual savings from the package of housing benefit reform. That is £2 billion off the £25 billion that I referred to. The Government believe that it is right that those living in oversized properties in the social rented sector contribute to those savings. Claimants in this sector make up over two-thirds of all housing benefit claimants, although most of the £2 billion in annual savings will still come from claimants living in private rented accommodation.
In England, approximately 420,000 households in the social rented sector underoccupy their accommodation by two bedrooms or more, while over a quarter of million households are overcrowded. What is more, 1.8 million households are currently on the housing waiting list in England. Over 700,000 of these households belong to reasonable preference groups, which means that they are treated as having a higher priority on the waiting list. This includes the homeless, people living in insanitary or overcrowded housing, and those needing to move because of a medical condition.
This measure is necessary to control spending. It is necessary because spending was allowed to spiral out of control under the previous Government, but we also believe that it will encourage greater mobility among households living in the social rented sector. It will help local authorities and other social housing providers to make the best use of their existing housing stock. It runs alongside and in support of measures introduced as part of the Localism Act, such as increased flexibility for local authorities to manage their housing waiting lists and the development of the national home swap scheme.
We have discussed this measure in detail and I have listened to and thought at length about the important issues that have been raised. We have various amendments to get through, but it might be helpful if I first set out what conclusions the Government have arrived at and what we intend to do. Noble Lords will understand that there is limited scope for manoeuvre within such a tight fiscal context, but I am pleased to announce today an additional £30 million that we will add to the discretionary housing payment budget from 2013-14, in support of the introduction of the size criteria into the social rented sector from April 2013. We believe that the amount made available is reasonable, based on what we know about the numbers likely to be affected by the measure. We think that £30 million could assist around 40,000 cases. It could help even more if local authorities choose to use DHPs to make up some, but not all, of a claimant's shortfall.
My noble friend Lord German asked what that funding is for. It is specifically aimed at two groups. The first group is disabled people who live in significantly adapted accommodation, and the funding is to enable them to remain in their existing homes. I hope that goes some way to satisfying the noble Lord, Lord Wigley, as well on that matter. The second group, which a number of noble Lords mentioned, is that of foster carers. We have carefully assessed the number of foster carers who will need to keep an extra room for when they are in between fostering, and we have an amount for them. I hope that goes some way to satisfying my noble friends Lord German and Lord Kirkwood on that matter, and indeed the right reverend Prelate the Bishop of Ripon and Leeds, who I hope feels that there is some room at the inn for this very vulnerable and important group.
The case for providing some mitigation for these two groups is clear, but we have decided that the way to do it is through the discretionary housing payment route rather than through specific amendments. We need rules in the benefit system that do not increase administrative complexity. We need to be able to make and deliver effective legislation not just within housing benefit but within universal credit. Such exemptions might, for example, include those who would otherwise have met the shortfall themselves, and might miss others who would have had a stronger case for additional support. I am convinced that a more localised, discretionary approach is the best way forward. It means that the limited resources that we have can be efficiently targeted at those who need them most. Of course we would like to do more, but there is simply no more money available.
Discretionary housing payments can be paid only where there is a linked claim to housing or council tax benefit. This is in effect, therefore, ring-fenced funding, although we cannot tell local authorities precisely who they should spend it on or how much they should spend. That is for local authorities to decide. However, we provide further guidance for local authorities through the DHP good practice guide. We have an illustrative draft of that, which I can share with noble Lords this evening, and we look forward to refining that with the input both of noble Lords and key stakeholders.
Lord McKenzie of Luton
Would the Minister clarify whether that £30 million is a one-off figure or an annual figure, and from when does it commence?
Lord Freud
I am pleased to clarify that that is an annual figure that starts in the year 2013-14, when the actual provision comes in.
Next, I would like to clarify the rates of reduction to be applied under this measure. In setting the percentage reduction rates, we have considered the sorts of rent differentials seen in the social rented sector alongside the question of affordability for the taxpayer. We intend to set the percentage reduction rates at 14 per cent for underoccupiers with one additional bedroom, and 25 per cent for underoccupiers with two or more additional bedrooms.
We think that the average cost to affected claimants, in terms of reduced housing benefit entitlement, will be around £14 a week in 2013-14. The majority of claimants affected—just over three-quarters of the total—are underoccupying their accommodation by just one bedroom. For this group, the average reduction will be around £12 a week. For those underoccupying by two or more bedrooms, the average reduction will be around £22 a week.
I would like to assure noble Lords that discussions within the coalition Government in designing this measure were thorough and productive, and these will continue through implementation. My officials are working closely with the Department for Communities and Local Government, the Department for Education, and the devolved Administrations.
It is worth picking up the issue, which my noble friends Lord German and Lord Stoneham raised, of whether we can make the transition easier. It is technically possible to stagger implementation arrangements, based on the anniversary of the claimant’s tenancy, but this move is not cost-neutral, and the planned savings will be reduced, albeit modestly.
I must be clear that, principally, I am more concerned about the ability to deliver the proposal because it might be very difficult to police and monitor. I am concerned that some landlords will offer new tenancy agreements to existing tenants, so that implementation of this change is delayed, and then the costs would spiral very substantially.
We are, however, determined to make maximum use of the time available between now and the measure coming into force to help prepare local authorities and social landlords for the changes, which in turn will benefit those who are affected. I am sorry if I rather loosely used the term “two years”, on which my noble friend picked me up.
Amendments 14 and 49, from the noble Lord, Lord Best, would exempt claimants from the measure where they underoccupy by just one bedroom. Amendment 12 would appear to tie Amendment 14 in with the housing costs calculation for universal credit.
There is a tension here between the bedroom standard, which is a widely used standard which views underoccupation as having two or more extra bedrooms, and the local housing allowance size criteria, which we propose to use for housing benefit purposes and which we already use for the private rented sector.
Our size criteria take a more generous view on the age at which someone is entitled to their own bedroom. Since the deregulation of rents in 1989, we have been using 16 as the adult threshold in size criteria for housing benefit purposes. The bedroom standard, on the other hand, sets the threshold at 21. Against these stricter criteria, however, the English Housing Survey and other similar surveys then consider the household to be underoccupying their accommodation only if they have more than one additional bedroom above the bedroom standard, a point the noble Lord, Lord Best, made. The size criteria that we propose to introduce into the social sector consider any number of spare bedrooms to be underoccupation. Neither approach is right or wrong. In some cases, the bedroom standard plus one will be more generous than the local housing allowance size criteria, in some they will work out the same and in a few cases the LHA size criteria would actually prove to be more generous.
On the point made by the noble Baroness, Lady Hollis, about the person who needs an overnight carer, I need to make it clear to the House that where someone needs an overnight carer we allow an additional bedroom for that non-resident carer, and we have done so from June this year.
Baroness Hollis of Heigham
My Lords, I said that she would “occasionally” need—in other words, the assumption is that she would not normally need an overnight carer but occasionally might. The Minister has not covered that.
Lord Freud
I suspect that we can look at the difference between “occasional” and “regular” in detail outside the House. Maybe we can exchange letters on the matter.
In Grand Committee, the noble Lord, Lord Best, spoke of the experience of owner-occupiers, explaining that 83.9 per cent would fail against our definition of underoccupation. I put it on record, however, that a similar proportion of working-age owner-occupiers, 86.7 per cent, are in work. We are not suggesting that households in the social rented sector should live differently. We all share the aspiration for a home in which our children can thrive, concentrate on their homework or leave to study or find work, but still have the option of returning home sometimes. To realise that, though, must the taxpayer be expected to pay in full for those extra rooms just because those people live in the social housing sector? The Government believe that it is reasonable to ask for a contribution toward the rent where there is, by definition, some degree of underoccupation. It is not a change to the allocation rules; it is a measure for housing benefit purposes only.
The research from the Housing Futures Network explores how those claimants affected by the measure might respond. As well as the 29 per cent who were likely to try to find work or increase their earnings, around 15 per cent thought that they would take in a lodger or ask another family member to move in. Another sizable group, perhaps 20 per cent to 25 per cent, thought that they were likely to seek help to pay the rent from someone within or outside the household—someone they know. Around 25 per cent thought that they were likely to downsize. There were also those, as some noble Lords have pointed out, who feared that they were likely to get into arrears; that figure was around 35 per cent. We will do our utmost between now and the measure coming into force to minimise that risk. This is what we are looking at as part of our work with the implementation group.
That said, we cannot ignore the financial position. I emphasised at the beginning of my response that the introduction of size criteria is fundamentally about savings. Without the inclusion of those who underoccupy by one bedroom, we would not achieve the £500 million savings expected from 2013.
The noble Lord, Lord Best, challenges our savings estimate. As I have set out in the evidence, though, a majority of people will pay the additional amount for the larger property. The cost of renting in the private rented sector may generally be higher but those who choose to move out of the cheaper social housing into private housing because they are underoccupying will by definition free up accommodation in social housing that can be offered to those on the housing waiting list or those living in expensive temporary accommodation. That argument from the noble Lord simply does not stand. If we excluded one-bedroom underoccupiers, we would lose around £300 million of the estimated savings. The fiscal case driving this measure forward must not be underestimated.
Lord Best
My Lords, I am deeply grateful to Members from all parts of the House for their support. I am grateful to the noble Lord, Lord McKenzie, for the refinement to my amendment, which I fully accept. I hope noble Lords who have spoken will allow me not to summarise the excellent points that they have made and go straight to a few words about the Minister’s very helpful remarks. I congratulate him on bringing an extra £30 million this evening to alleviate the problems created by this legislation. Perhaps I could just pick up on two key points that he made.
The first is the suggestion that the proposed new definition of underoccupancy would bring social housing into line with the private rented sector. Tenants in the private rented sector are unaffected by this measure. They operate within a quite different framework, whereby the maximum of the local housing allowance is calculated for them based on this tight definition of underoccupancy but with the opportunity for the tenant to use the cash—the benefit—for something smaller, perhaps in a better area, or larger, perhaps in a less popular neighbourhood. In any case, those in the much more expensive private rented sector are predominantly younger, single and childless households, more than half of which stay for less than two years, and a third for less than one year. Unlike those in social housing, they seldom comprise a family needing a long-term home in which to bring up their children.
Secondly, the concession that the Minister has brought to us this evening would allow discretionary housing payments to be made to people whose properties have been specially adapted for a disabled member of that household. The discretionary housing payments would also be available where a foster child is coming into the property. These are excellent exclusions, or opportunities, at any rate, for a discretionary payment to kick in. One could list a whole lot more. Indeed, as one gradually looks at this, one begins to do just that. Why not include people with other disabilities—perhaps a family where, as the noble Baroness, Lady Hollis, suggested, a carer comes to stay periodically to provide respite for a parent? Perhaps an exception could be made where an elderly person has a spouse aged only 60. As things stand, they would both have to move or pay up.
The Minister says that everyone must pay their part and, on average, £14 per week is the part that many households will have to pay as the penalty charge. Even if it is £12, or £22 at the other end, I suggest that these are serious sums of money for many people in very low-income households, if they stay put. The option of moving does not exist for a lot of them.
I think this is the moment at which I would like to test the opinion of the House.
Baroness Turner of Camden
“(3A) In the case of alleged under-occupancy regulations may provide—
(a) in the case of a disabled person, relocation shall not be required nor shall benefit be reduced, where adaptation has occurred and local services are provided, in order to deal with the disability;(b) in the case of a person capable of work-related activity, reduction of benefit or relocation shall not be proposed unless suitable employment is available within easy access of alternative accommodation.(3B) Relocations may only proceed on the basis of agreement with the claimants concerned.”
Baroness Turner of Camden
My Lords, I have had a very large number of letters on the whole issue of underoccupancy. The vast majority of tenants simply do not recognise that they are underoccupying. Eight out of 10 believe that the size of their home is just right, and that probably applies to a lot of us. Of course, some people would welcome the opportunity to move to somewhere smaller. If children have left home, a smaller place might be less trouble, provided, of course, that it is available. But this does not apply to everyone, particularly the elderly and the disabled.
Take the case of a woman who is disabled and has recently been widowed. She has lived in the same accommodation for more than 15 years. She is now alone and on benefits. She has neighbours who give her support. She is told that she is underoccupying and must either relocate or pay more. She cannot afford to pay more and dreads the thought of moving. She needs the support that she is getting in the community that she has lived in for so long. This is an actual case that has been reported to me. It seems to me that it would be wrong to insist on relocation in such a case. It might even be more expensive if the woman became ill and had to be hospitalised.
There is also, as is the case with many disabled people, the question of adaptation. Homes are often adapted in a gradual way as people get older, perhaps starting with a change in the bathroom with a shower in place of the bath, perhaps then installing a stair lift, and then adding to these adaptations as the debility gets works. This is one of the areas that the Government are giving serious attention to, as the Minister indicated in his response this afternoon. I am glad to note that. The presence of adaptations is one of the two areas in which the Government are apparently ready to make some concessions, and I welcome that.
Other instances in my amendment relate to job opportunities. The Government want as many people as possible currently on benefits to go to work. Some of them are capable of light work and many actually want to work. One should not pay too much attention to media stories about people being only too willing not to work. Many people want to work, because work is a social function anyway. However, if someone is forced to relocate, it may be to an area where jobs do not exist, or, if they do exist, they are a long distance from the relocated home. That may not be suitable for a person able only to do light work. There may also be additional travel costs.
The point of this amendment is to acknowledge that this is not an easy matter. We have noted that from some of the speeches made today. Compassion is required when dealing with people in this position. If the alternative is relocation, it should be by agreement. A home is extremely important to most of us. Homes, and the personal possessions they contain, represent lives. We have to be very careful about the way in which this situation is handled. If the Government proceed with their proposal unaltered, there are substantial risks that entire communities could be disrupted. Long-term tenants—45 per cent of the households have been tenants for 10 years—could be affected. People develop local connections and the disruption would be enormous.
If we do not handle this properly, human tragedies could come to pass. For that reason, I hope that there will be support for the suggestions made in my amendment. I should be grateful to learn from the Minister how exactly the Government intend to cope with the situation. I beg to move.
Baroness Wilkins
My Lords, the Joint Committee on Human Rights has just published its legislative scrutiny of the Welfare Reform Bill in its 21st report of the Session. I quote from its recommendations:
“The National Housing Federation estimates that about 108,000 tenants in social rented properties adapted specifically for their needs are likely to be affected by the introduction of the size criteria to restrict housing benefit. If such tenants were forced to move into properties unsuited to their needs this might risk breaching their Article 8 rights to respect for private or family life as well as being potentially discriminatory.
The Government has indicated that it is prepared to look at exemptions for individuals who are disabled, where their homes have been subject to extensive adaptations. However, this would not address the disruption to patterns of caring and support networks which can be vital”.
The JCHR concludes:
“We recommend allowing some additional discretion to exempt disabled people facing exceptional hardship from the under-occupation provisions”.
I hope that the Minister will not only agree to the amendment but also agree to the JCHR’s recommendations.
Baroness Thomas of Winchester
My Lords, I have a question for my noble friend about the disabled facilities grant, which I gather is rising to £180 million in the current fiscal year. However, as we know, this grant is not ring-fenced, although it is still a mandatory grant. I find that a slightly odd concept. I just want to make sure that this grant is quite separate from the discretionary housing payment. What redress will a citizen have if the local authority is being rather mean with the mandatory disabled facilities grant? I have not quite got my head round that matter. It may be entirely a matter for the local authority but I wonder whether my noble friend can help me regarding the disabled facilities grant in particular.
Lord Lester of Herne Hill
My Lords, as a member of the Joint Committee on Human Rights, I simply say how glad I am that the noble Baroness, Lady Wilkins, has drawn attention to that part of our report. I agree with her speech.
Lord McKenzie of Luton
My Lords, we have Amendment 14ZA in this group, which concerns foster carers seeking exemption from the underoccupancy penalties. We know—indeed, we heard a short while ago—that the Government are sympathetic. When we discussed this in Committee, the Minister told us that it was not possible both to disregard foster allowances as income and to include foster children in the assessment of housing need. However, the National Housing Federation has suggested that discussions between fostering organisations and DWP officials have not shed any light on why the trade-off would be inevitable and has suggested that it could be sorted out by legislation.
As we heard earlier, the Minister’s solution to supporting foster carers was the use of discretionary housing payments and the additional funds that have been made available, and it would be churlish not to welcome that. However, it is hard to see how this can adequately address the problem, given the many other calls on these payments that are likely to be made. Of course, these payments are discretionary, so there would be no certainty for those looking to foster a child that their housing benefit would be covered. It is suggested that the Minister cannot possibly see the inclusion of foster carers within the underoccupancy penalties as a cost-saving measure. As the LGA has put it, if these penalties apply, foster carers could be forced to give up this role at a time when there is a national shortage of 10,000 foster families across the UK. I urge the Minister to give due consideration to this matter, but in doing so I welcome the announcement that he made earlier.
My noble friend Lady Turner introduced amendments that covered three issues. The first was about adaptations to properties, which has been fully covered. My noble friend Lady Wilkins made the important point that this is not just about the physical adaptations to properties but about the support that people need in their community.
My noble friend also referred to someone in the work-related activity group being exempt unless there was suitable employment within easy access of alternative accommodation. We need to know that someone in the WRAG would not necessarily need to be in employment but to be working closer to the labour market. Nevertheless, my noble friend makes a valid point.
My noble friend’s third point was about claimants agreeing to any proposed relocation to alternative accommodation. In the debate on the last group of amendments, we debated a little the issue of suitable alternative accommodation for people, what “suitable” might mean and the complexity that might come with that. To the extent that it features in these arrangements, the opportunity for the claimant to be able to agree to what is reasonable is a fairly fundamental point as well, so I support my noble friend’s contention.
Lord Freud
My Lords, Amendment 13—and Amendment 48, which is a repeat of Amendment 13 but relates to Clause 68—tabled by the noble Baroness, Lady Turner, seeks to make a number of changes. I spoke earlier about how I propose to address the noble Baroness’s valid concerns about those living in adapted accommodation, and I hope that that has satisfied that particular position. On the related point raised by my noble friend Lady Thomas, the disabled facilities grants are quite separate from this; they are administered by local authorities to meet those costs. It is a separate pot, if you like, run by local authorities and not by the DWP.
Amendment 13 would create a new Section (3A). Proposed new paragraph (b) deals with the availability of work in an area and seeks to exempt claimants from the underoccupation measure by their not being relocated to an area where there is no suitable employment, or from a reduction if there is no suitable employment near their current home. We are not in the business of dictating to people where they can or cannot live and we have no intention of doing so. We expect that most people will choose to stay where they are and meet the shortfall. This was supported in the research from the housing futures network, which we have already discussed.
Let me put into perspective the numbers of people who are looking to increase their hours of work. We are talking about between two and four hours per week at the national minimum wage to meet these shortfalls. The amendment links an exemption to the availability of suitable employment, which would be hugely complicated to administer. We would need to define suitable employment and easy access, and in our view those are decisions for the tenants themselves to make, just as those people who live in the private rented sector or who are buying their own properties make such decisions. The labour market is constantly evolving. From a practical point of view, the exemption would be unworkable.
Proposed new paragraph (b), which would be inserted by Amendment 13, would appear to ensure that claimants are not forced to downsize against their will. The amendment would achieve that, but in practice it would go even further. It would enable claimants to block relocations by their landlord regardless of the circumstances. It is unusual for a social landlord to relocate a tenant without their consent, but they can do so in some circumstances, such as where they plan to redevelop the area. We do not intend to interfere in the relationship between landlord and tenant, and nothing in our legislation would force a tenant to move against their will.
On the size criteria measure, we are not seeking to force people to move, but we are asking people to consider the affordability of their accommodation where it is larger than they require, and I beg the noble Baroness, Lady Turner, to withdraw her amendment.
On Amendment 14ZA, which was tabled by the noble Lord, Lord McKenzie, I have set out our intention to increase the DHP budget with the specific aim of helping foster carers as well as disabled people in adapted accommodation. We very much value the work done by foster carers who care for and welcome children into their homes. That is why the benefit system already treats them more favourably by not taking those children, and, as a result, any fostering allowances, into account in their assessment. However, we recognise that there might be circumstances in which a reduction in the housing element of their benefit might act as a disincentive to fostering, and in such circumstances a local authority will have additional funds to award a DHP.
I should make the point here that local authorities will have a direct interest in applying those discretionary funds because they will make a saving by keeping the fostering market open. This is not one of the areas where one worries about discretionary funds being used in other ways; this is an incentive for the local authority. Just to reinforce that natural incentive, we are going to make sure that children’s services within local authorities will be made aware of the availability of DHPs and will input locally on their priorities. I know there are many concerns in this area, but I really think that we have closed the circle.
This amendment seems to go further and would not allow any deduction to the housing element, thereby prohibiting deductions for other income or non-dependant deductions. It also does not cover foster carers who are between placements and who therefore have no income from fostering allowances. The flexibility of DHPs will allow for such circumstances, if it is felt necessary.
The noble Baroness, Lady Wilkins, raised a point on the JCHR. We have just received that report and will be considering it very closely.
I consider that we are meeting the needs of this group through the increase to DHPs, and I therefore beg the noble Lord, Lord McKenzie, not to move his amendment.
Baroness Turner of Camden
I thank the Minister for that response. He seems to have made a number of concessions in response to me. He outlined some of the practicalities, which I understand. I intended the amendment to acknowledge that this is a very complex and difficult area. I was seeking to give a certain amount of guidance to the Government about the way in which it should be handled; otherwise a number of people are going to be very badly hurt, and there could be a few human tragedies on the way, which one would not like to have. I accept that the Minister has made a number of concessions this afternoon. This is a very complex area, so I would like to have the opportunity to study it again. It is unlikely that I will come back with this at Third Reading because we have been over the ground fairly comprehensively. In the mean time, I thank the Minister for the concessions that he has made and beg leave to withdraw the amendment.
Amendment 13 withdrawn.
Amendment 14
“(3A) In relation to a dwelling of which the landlord is a local housing authority or a registered provider of social housing, regulations under this section shall not permit the housing cost element of the universal credit to be less than the actual amount of the liability in a case where a household has no more than one spare bedroom.”
Lord McKenzie of Luton
The Deputy Speaker (Lord Geddes)
My Lords, since this is a manuscript amendment, it might be of assistance to the House if I read it.
“In Clause 11, line 3, after ‘provider of social housing’ insert ‘, and no suitable alternative accommodation (as defined in regulations to be made under this section, and provided by any such provider) is available’”.
Lord McKenzie of Luton
Lord McKenzie of Luton
My Lords, the amendment deals with mortgage interest relief. When we raised this issue in Committee, the Minister told us that it was actively under review. We have now had a chance to see the results of that review with the publication this month of a call for evidence on support with mortgage interest and we have some concerns about what it contains.
The main proposals outlined include placing a charge on the property of any long-term claimant of mortgage interest support, which, with an additional sum for interest and an administration fee, would be recouped on the sale of that property; paying the support directly to the claimant rather than to the lender as at present; introducing a zero-earnings rule for eligibility for mortgage interest support to prevent in-work claimants on universal credit from qualifying; and extending the current two-year restriction for JSA claimants on claiming support for mortgage interest to those previously entitled to some transitional protection.
The Government’s stated rationale for the changes is, once again, to encourage claimants into work. The document states:
“A core aim of Universal Credit is that working age claimants have strong incentives to take up work in order to maintain their choice of housing tenure”.
However, the proposals to place a charge on the property of MIS recipients at present apply only to those who are not expected to move back into work—those who, in the words of the call for evidence,
“need long-term help with their mortgages because they are disabled or have retired with outstanding mortgage liabilities”,
and whom, the document states, it is not fair for the taxpayer to support indefinitely. Perhaps the Minister in his response could outline the key rationale for these changes. Are they intended to ensure that anyone who wants to remain in their home must move into work? Or are they intended primarily as a cost-saving measure? What are the expected savings from the scheme to put a charge on the property, and how do these compare to the potential added expenditure on housing benefit if people decide that they would rather not pay this charge and move into the private rented sector?
On direct payments to lenders, we have had significant representations from landlords who are worried about the impact of direct payments to tenants of housing benefit—we discussed this in Committee on a number of occasions and will discuss it again shortly. The Council of Mortgage lenders seems similarly concerned about these proposals, with its director, Paul Smee, stating that,
“the principle of paying the benefit to claimants rather than lenders is dangerous in terms of potentially reducing its effectiveness in meeting its intended purpose”.
Could the Minister let us know what discussions he has so far had with lenders about these proposals?
The Minister will doubtless say that the proposals in this document are out for consultation—that is, they are just that: proposals—and that he will consider views on them. Perhaps he could therefore let us know the expected timetable for any changes to support with mortgage interest payments. It would be particularly useful to know when he intends to make decisions about eligibility for this support under universal credit, as the level of support provided will make a significant difference to whether work pays for home owners.
We look forward to further detail on these measures, but it would be extremely helpful if the Minister could take a moment to outline the principles behind them and the expected timescale for their introduction. I beg to move.
Lord Freud
My Lords, I thank the noble Lord for this opportunity to debate the way in which we will provide help with mortgage costs alongside, or as part of, universal credit. As I have said previously, housing support is critical to the success of universal credit. It will recognise that people need support across a range of different tenure types whether they live in the private rented sector or the social sector, or whether they are owner-occupiers.
Noble Lords will have seen the illustrative regulations on the universal credit housing element which set out our broad approach to support for housing costs. The regulations will indeed make provision for help towards mortgage interest payments.
I also mentioned in Committee that we would be consulting on possible future reforms of the support for mortgage interest rules. As the noble Lord pointed out, we published not a consultation but a call for evidence on 6 December which contained a number of ideas on simplifying the help provided towards mortgage interest payments for working age and pensioner home owners. One of the reasons that it is a call for evidence and not a consultation is that there are much less backing data in terms of impact assessments around a call for evidence than a consultation. Therefore the noble Lord will forgive me if I do not supply the answers to some of the questions he asked me. That is the difference in the process.
We intend to provide support for owner-occupiers, as the call for evidence makes clear, whether this sits inside or outside of universal credit and pension credit. The call for evidence seeks views to help inform the appropriate way forward in determining how financial support towards mortgage interest costs should be changed in both the shorter term and longer term. We are looking at a different model to deal with the longer-term costs of supporting home owners. Essentially, we are looking for a way in which we can keep people in their homes when it is long term, but not at an exorbitant, open-ended cost to the taxpayer. That is the point of exploring these issues: we want to make sure that it delivers fairness to taxpayers.
For support for mortgage interest, we intend to have a rule that provides that help with mortgage costs will stop once a claimant starts work, as is broadly the case now. We believe that the position of claimants with mortgages is different from that of tenants. Owner-occupier claimants have been in work—clearly lenders would not advance money for house purchase unless the borrower could service that debt through income from work. If owner-occupiers are to be able to service their mortgage debt in the future, then they need to return to full-time work and our proposals, or our evidence call, reflect this reality.
The call for evidence runs for 12 weeks until 27 February 2012 and we will of course consider carefully the responses, whether from the CML or anyone else—noble Lords are welcome to add their views, at which I shall look with great interest—and, based on those responses, we will then develop our detailed policy proposals. I can assure the House that we are continuing to provide help with mortgage interest costs. With that assurance, I hope the noble Lord will withdraw the amendment.
Lord McKenzie of Luton
I am grateful to the Minister for that reply. I certainly do not intend to press the amendment. As he explained, this is very much work in progress. Can he say a little more about the reactions to date—particularly from the Council of Mortgage Lenders—in respect of the direct payment issue.
Lord Freud
To be absolutely honest, I have talked to the CML about this matter but I have not had a direct conversation with it since we issued the call for evidence. One of the reasons we had that as one of the questions is specifically to get a considered view from it as to how that might work.
There are a number of issues. At the moment, we pay a fixed rate for everyone based on the average mortgage. The Council of Mortgage Lenders has said in the past that it prefers the actual amounts. So there are a lot of issues. It is administratively complex. I know I am telling the noble Lord things he already knows because he was in situ while some of this was being developed. There is a nest of complicated issues. We are trying to flesh this out in the next few months.
Lord McKenzie of Luton
I am grateful for that further clarification and beg leave to withdraw the amendment.
“(4A) Regulations shall provide for a relevant change in circumstances to include a change in the claimant’s actual rent.”
Baroness Hollis of Heigham
Amendment 15 is a simple, genuinely probing amendment to get further clarity on the draft regs, given that they have now been published. Currently, a claimant’s housing benefit entitlement is reviewed on the anniversary of the claim or when there has been a material change of circumstances. The normal review would be 1 April annually. At the moment, if the rent is raised by the landlord between these annual reviews, the tenant must report this to the local authority as a material change of circumstances. Usually, although not always, the housing benefit would be raised to cover it. Under the new system, if the claimant’s tenancy is renewed and the rent increases at any point after April, then even though the rent would still be within the local housing allowance or the housing benefit cap, the claimant’s housing benefit will not be adjusted until the following April. It means, in other words, that they could go for 11 months with not enough housing benefit to cover their rent, even though they are entitled to it, and even though they would have got the full year’s increase in HB had the rent increase occurred a month before. Because of the timing of the accidents—of the rent increases, in other words—a tenant and his family could face real shortfalls and potential hardships: rent arrears and possible homelessness, with the usual problems that would result.
This amendment would require an increase in rent to be considered a relevant change in circumstance, which would be a simple way to avoid any potential hardship. It would ensure that housing benefit would continue to be reviewed in the light of a rent rise, as has occurred in the past. I am hoping that the noble Lord can give us that assurance.
Although Amendment 16 is on a different topic, I have grouped the two amendments to avoid going on for too long. In Committee, I ran an amendment because I was worried about the increased deduction that would come from housing benefit if a middle-aged couple had their adult son—a non-dependant adult, in the jargon—living at home with them. We noted then that the couple could face all of their housing benefit being wiped out because a son over the age of 18, who is perhaps on modest earnings, would be expected to contribute up to £90 a week. No deductions, of course, are made if he is in full-time education or on JSA. If he is in a minimum wage job, his parents could face losing virtually all their housing benefit, as he is expected to pay for his parents’ rent himself, even though he is not the tenant and even though he has no security of tenure. We feared either that he would drop out of work for their mutual financial advantage or that his parents might propose that he leave home and find a small place of his own to save their housing benefit, while leaving his parents underoccupying and being fined with a cut in their HB in turn. Either way, the family is damaged. Obviously the most satisfactory option would be for him to live at home, make the best use of the housing space and contribute—though not unreasonably so—to their housing costs. But can he do so if that is the sensible choice?
I have some questions for the Minister. In future, will the son, as a non-dependant, be counted as part of the household when DWP works out the space that the family are entitled to have for their HB? I would love to think that the amendment we have just passed has made that question redundant—touch wood that it has. As a couple, in future, will his parents be deemed to be underoccupying by one bedroom because of their adult son? Hopefully—touch wood—that question may now be redundant. However, there is a problem of the interplay of underoccupation and adult non-dependant deductions which the family could face. The Minister recognised this when we talked about it in Committee. He said:
“We need to look at the treatment of non-dependants … Furthermore, we need to ensure that there is some sensible fit with the provisions for underoccupancy … We want a scheme that provides incentives for tenant and non-dependants to work and at the same time preserve incentives for households to stay together”.—[Official Report, 20/10/11; col. GC113.]
The Minister was absolutely right. Could he clarify what his intentions would be in that situation? I beg to move.
Lord McKenzie of Luton
My Lords, I shall be brief, because it is very rarely possible to add to something that my noble friend has said in moving an amendment. However, I will try in two respects.
Amendment 15 deals with a relevant change in circumstances. How would that feed through into changes of circumstances that may impact on transitional relief for universal credit? Would a change in rent level support be a change of circumstance that would have to be taken into account?
As for non-dependant deductions, under existing arrangements there are a range of circumstances whereby people who might be treated as non-dependants are not and where some non-dependants do not generate a deduction under the provisions. For example, in respect of the latter, no deduction is made in respect of any non-dependant who is staying with someone but whose normal home is elsewhere, who is receiving a training allowance in connection with youth training under specific provisions or is a full-time student during his or her period of study or is in hospital for more than 52 weeks. There are those sorts of exemptions. Is it planned that those will be carried forward into the new world of universal credit?
Lord Freud
My Lords, local housing allowance rates are set each year at the anniversary date of the claim. In many cases, they coincide with claimants’ annual rent increases, but as the noble Baroness, Lady Hollis, will recall, during the LHA pathfinder some landlords increased rents mid-year to take advantage of increasing LHA rates. That is why we will operate a common uprating date of 1 April.
I would like to consider this matter further. I do not believe that it is appropriate to provide regulations in the Bill, and we will have an opportunity to debate the regulations in this area. However, I can assure the noble Baroness that we will consider the implications of a common uprating date for this group of claimants as part of the continuing work on the treatment of change of circumstances in universal credit. I am not able to get to a conclusion on what we define as a change of circumstances. Again, it is an interconnected group of things. On the basis that I am working on it, I hope that the noble Baroness will agree to withdraw the amendment.
The next area is on non-dependants. We debated a similar amendment in Committee, and I remember blushing with pride when the noble Baroness said that I made an intelligent response. It is a rare accolade that I get from some members of the opposite Benches, but not all.
Lord Brooke of Sutton Mandeville
The noble Baroness was even more generous. She actually described it as a “very intelligent response”.
Lord Freud
I thought that I would be self-deprecating and leave the “very” out.
The noble Baroness asked me to keep the House briefed on the thinking here and return at Report. The best that I can do now is to say that we have not changed our views. There is a lot of active work, and I know that the noble Baroness, Lady Meacher, also took a great deal of interest in this issue. The universal credit will recognise the general principle that adults who live in the household of people getting help with their housing costs should expect to make a contribution towards those costs. Not to do so would, in effect, mean that taxpayers would subsidise non-dependants through the benefits system. I think that that is common ground around the House.
It is also common ground that a reformed welfare system must make work in comparison to dependency benefits pay and be seen to be paid, and the current treatment of non-dependants can work against employment incentives for both the claimant and non-dependant. As I said, there are various factors that we have to juggle between decisions on non-dependants—the “touch wood” factor, taking in a lodger, and so on. These factors mean that the issue of non-dependants is complex.
I accept that the amendment is a probing one, but it would not work. However, we are considering it in detail, and it is an important area. It really goes to the heart of the simplicity agenda that we have, and I hope that as we flesh out the detail noble Lords will have something to which the expression “very intelligent” remains applicable. On that basis, I ask the noble Baroness to withdraw her amendment.
Baroness Hollis of Heigham
I am happy to withdraw my amendment. I absolutely understand that this is a work in progress, but we now have the draft regulations, which we did not have in Committee, which is why we are trying to probe to see where this goes. The problem could be that, were it not for the earlier amendment being passed, a couple in a two-bedroom place with an adult son could be regarded as underoccupied if the adult son was not counted as eligible for the room, whereupon their housing benefit would be cut—but, because he was in the House, he would be expected to cover not just their housing benefit but the cut as well. It is that Catch-22 situation that I am seeking to avoid.
It is not straightforward, and I understand that. I am grateful for the Minister’s response. I look forward to an appropriate, acceptable and welcome solution to these dilemmas. I beg leave to withdraw the amendment.
“(4A) Regulations shall provide for—
(a) the frequency with which reviews of the relationship between increases in the rental market and the CPI will be conducted;(b) the circumstances in which increases in the rental market and CPI will be deemed to have diverged;(c) the circumstances in which there will be considered to be a critical lack of affordable housing;(d) the circumstances in which this will lead to a change in the method used to uprate the housing component of universal credit.”
Baroness Hollis of Heigham
I have a series of amendments on housing. This amendment calls for periodic reviews of the interconnection between CPI and rent levels. This is an issue that has concerned the whole House at different stages, including on the CSR Statement as well as in Committee.
We know now that the proposed deficit reduction programme, according to the Chief Secretary, will extend for a further two years at least beyond the general election. This amendment now takes on the added urgency that perhaps did not exist at the time when we discussed it in Committee. Local housing allowance, which I will call housing benefit, in the private rented sector is based on the 50th percentile of private rents, which should mean that half of all private rents are affordable on HB and half are not. It is a median. The HB, in other words, covers the average rent. We also know that the Government are reducing that 50th percentile to the 30th percentile, which means that 70 per cent of properties would be unaffordable but 30 per cent should still be so. We have argued that and resisted it, but the Government have insisted on their proposals. That is bad enough and will make it much harder to find a private rented home. But, in addition, HB to cover your rents up to the 30th percentile will rise only by CPI, not by the actual increase in private sector rents. Yet according to Savills rents are rising at the moment by more than 7 per cent a year, and CPI is only half of that—not this year but we expect it to be. Rents are rising on average at double the rate of CPI, mainly because of additional demand for private flats from young people for whom originally the flat would have been a transit tenure but who now stay there while they seek to save their deposit for a home of their own.
The Minister used to argue that capping HB would drive down rents. That is not happening, nor will it, because no longer do landlords have to let to HB tenants. Just as there are eight people after every job, there are eight tenants after most lets. HB tenants will get only what no one else will take: the substandard, the squalid and the downright unsafe. Any complaints and you are evicted after six months. Tenants will be forced into poorer and poorer accommodation. Worse, as I say, rents are rising at double the rate of CPI, so whereas now your HB may theoretically cover 30 per cent of available rents, in three years’ time it may cover only 20 per cent, and in five years only 15 per cent. In more expensive towns such as Winchester, it is estimated that there will be nothing available to rent for anyone on HB within the next few years.
This amendment is very simple. It requires that the Government's original policy intent—that HB in the private sector will allow the tenant the choice of the bottom 30 per cent of properties—continues to be respected and that the widening gap between the CPI uplift in HB and the actual rise in private rents does not invalidate the Government's intentions. In other words, this amendment simply asks the Government to ensure that they do what they say they want to do—no more, no less—and that we keep clear the policy intent, and that it is delivered.
In the past, the Minister has decorously brushed this aside by saying that it is outside the CSR period, but given the Chief Secretary's remarks, it is not any more. He also helpfully said in Committee on 20 October that,
“if local housing allowance rates are clearly out of step with rents, they can be reconsidered”.—[Official Report, 20/10/11; col. GC 146.].
It would be very helpful to know how this would be done, given the vagueness of the draft regulations. The Government should confirm whether reviewing the operating method will occur periodically or, if not, what will trigger it. This amendment seeks to get greater clarity in the regulations in order to protect the Government’s own policy intent: that 30 per cent or so of private lettings should be affordable and available to those on local housing allowance. I beg to move.
Baroness Meacher
My Lords, I support Amendment 17, to which I added my name. As always, the noble Baroness, Lady Hollis, has comprehensively covered the issues and I will therefore take only a few moments of your Lordships’ time to express my personal concerns about the issue.
The Government have a policy to reduce over time the percentage of GDP paid out in benefits to those on low incomes and those out of work. Perhaps the main mechanisms by which this will be achieved, though by no means the only ones, are the range of housing allowance controls to which the noble Baroness referred and the linking of housing allowance to the CPI, rather than to the rate of increase of rents themselves. The problem I have with the CPI link in particular, along with all the other controls, is that it is beyond the control of government how this plays out; hence the importance of these monitoring mechanisms that the noble Baroness has spelt out.
For example, if the euro collapses—it seems ever more likely that it may—and we have several years of recession or, indeed, deep depression with falling prices, do the Government have any idea how rents will respond in that situation? Because of the pressures of a growing population with more and more single-person households, as well as the limited stock of properties, particularly in London and the south-east, it is possible that rents may remain static, or even rise in the south-east, while other prices are falling. The Government assume that the downward pressure on housing allowances will ensure that in fact rents fall as well, but I am not at all confident about that. There is a huge private rented sector out there and as fewer young people can afford to buy, more and more of them will indeed move into that rented sector.
A very different scenario will be that once the years of fiscal tightening are over inflation could return with a vengeance, leaving a soaring gap between the RPI and the CPI—the prices claimants will have to pay in the shops on the one hand, and the CPI which will determine their housing allowance levels on the other. Of course, all these uncertainties will be there alongside a benefits cap, which may or may not be inflation-proof, and the need for many vulnerable people to adjust to a move from higher ESA to lower-level JSA. The Minister knows that I fear many vulnerable people will be included within that group, going down the slope towards the cheaper JSA. There is also the loss of disability benefits for children, the loss of tax credits and so forth, and the move to monthly payments if we cannot persuade the Minister that this will be the last thing that people are going to cope with. For all these reasons, I agree with the noble Baroness, Lady Hollis, that the House needs some assurance that there will be systematic and regular monitoring of the consequences of linking rents to CPI and on how the situation will be assessed and in what circumstances a change of policy would be regarded as appropriate.
I would also be grateful if the Minister could inform the House on a particular aspect of this issue. Shelter and the Chartered Institute of Housing estimate that the link between local housing allowances and the CPI will, by 2030, result in 60 per cent of local authority areas being unaffordable for LHA claimants. Undoubtedly, these will be the areas with jobs. Can the Minister say whether the Government accept this estimate and, if not, what the Government’s estimate is? Whether or not he accepts the estimate, has the DWP undertaken an impact assessment of the housing allowances/CPI link on employment in this country? What particular impact on employment will this have?
If households have no option but to move to areas with very few employment opportunities, how much higher will unemployment be year on year than would otherwise be the case and what will be the costs of that higher unemployment for the taxpayer? These sorts of issues need to be incorporated within the ongoing monitoring and assessments of the impact of these policies, year by year. Within the Minister's response to this amendment, I would be most grateful if he could include some reference to the employment impact.
Lord Freud
Noble Lords will be aware that we propose to limit increasing the local housing allowance in line with the CPI index from April 2013. The aim here is to ensure that we continue to exert downward pressure on rents while looking at rent levels in local markets. The limit will apply only in areas where local market rent increases, at the 30th percentile, exceed the annual rate of CPI inflation. We have said that we are committed to making savings from this measure up to 2014-15. If it then becomes apparent that local allowance rates and rents are out of step, they can be reconsidered.
To prepare for this change, the Minister for Pensions set out in the uprating Statement the arrangements for fixing rates. The first uprating will be in April 2013. We have taken this step to ensure that CPI rating can commence from April 2013, but that nobody will see their ongoing award fall at that point as a result of LHA rates being uprated. As the annual rates will be set well in advance, we will be able to provide clarity and certainty to claimants and landlords. We will continue to monitor the path of market rents until 2015 and the Secretary of State will be able to review the LHA rate, or uprate it by some other method, should the need arise.
As the noble Baroness, Lady Meacher, pointed out, the future is uncertain. Clearly, you can draw any scenario you like; the point is that we need to watch it and we will watch it very closely. In particular, we may need to increase LHA rates if growth in rents and the CPI are so out of sync that there is a critical lack of affordable housing. To pick up on the noble Baroness’s other point on extrapolating out to 2013, clearly we all recognise that over any kind of longer-term run rents tends to move with average earnings, not with average prices. Any extrapolation out that long will have a big gap, but we are not talking about that here. We are talking about a measure which is locked in for that two-year period at a time of great difficulty when we are trying to bear down on prices. Therefore, I do not think it is relevant for me to hypothesise about employment levels. That is not what is happening here.
On the point about data and monitoring and what Parliament can expect from us, we will provide to Parliament on an annual basis from late 2012 the relevant CPI data and the data on the 30th percentile of market rents. In addition, noble Lords should be aware that the Valuation Office Agency currently makes available quarterly data on market rents by local authority.
I should point to the major piece of independent external research that is already underway to evaluate the impact of the reforms to housing benefit announced at the June Budget and the spending review. Indeed, I need to thank the noble Lord, Lord Best, for the way that he shaped that research effort. The research will be comprehensive and will be presented to both Houses and the public alongside a ministerial Statement. The department is currently considering how this research could be extended—subject, of course, to funding—to allow it to look at the impacts of changes to local housing allowance uprating over a longer period.
I hope that I have reassured noble Lords that we are committed to monitoring and evaluating this change really thoroughly. On that basis, I urge the noble Baroness to withdraw her amendment.
Baroness Hollis of Heigham
I am grateful to the noble Baroness, Lady Meacher, for her support and her additional probing and questions. I am more than satisfied with the Minister’s reply, apart from one word. I wonder whether I could invite him to change that one word. He said that if the two tests, rent levels and CPI, are out of step, then they “can be reconsidered”. I want “will be reconsidered”. I invite the Minister to strengthen his position on that point. Everything else was lovely.
Lord Freud
On the basis that the noble Baroness is going to be incredibly helpful to me in all the consequent amendments in the Bill, I will change the word from “can” to “will”.
Baroness Hollis of Heigham
I am very grateful and with great pleasure withdraw the amendment, knowing that our policy intent and the Government’s policy intent will now be met. Thank you.
Lord McKenzie of Luton
“(4A) Regulations shall not permit any reduction of housing benefit or amounts included for accommodation in an award of universal credit in respect of under occupation, deemed or actual where—
(a) the landlord is local authority or registered provider of social housing, and(b) any such landlord is not able to offer suitable alternative accommodation which would not cause a person to under occupy.(4B) Regulations may make provision for determining when accommodation is suitable for the purposes of these provisions.”
Baroness Anelay of St Johns
My Lords, first, may I ask a question of the Opposition at this point? There has been no claim that this amendment is consequential, and it clearly is not consequential. I say so in a spirit of wishing to elucidate information and explanation from the Opposition, and it is not necessarily overtly hostile, because the Opposition are looking rather puzzled. The Opposition have not at any time said that this is consequential. It is the view of the Government, on advice, that something that refers to regulations is so clearly not consequential upon the earlier loss.
I wonder if the noble Lord could say, for the benefit of the House and before the Minister is able to take a decision, why he considers it to be consequential.
Lord McKenzie of Luton
My Lords, I do not believe I considered it to be consequential, but I believe that we debated it as part of that first group. We had a wide group, of which this was part. I was not anxious to revisit that debate. If the noble Baroness insists that we do, perhaps we could set aside another couple of hours to do that.
Baroness Anelay of St Johns
My Lords, I shall respond in the same helpful measure. I am grateful to the noble Lord. The Chair put this as moved formally; that was the improper thing. I hasten to add that I know that the Chair was not trying to be improper.
Of course, I have to put on record that this is a separate matter. If the Opposition wish to press this to a Division, that is their absolute right, and I recognise that. However, the Government cannot accept Amendment 17A because it is not consequential, and the Minister clearly has not accepted it. I hope that that is an explanation which is a little clearer than mud.
Baroness Hollis of Heigham
My Lords, I am sorry to press this, but I understood that when the noble Lord, Lord Best, moved his original amendment, he accepted the additional amendments in the group as amendments to his amendment. He did this to ensure that his original intent regarding the one spare bedroom was modified by the extent to which there was available accommodation. If there was not, his standard would apply, but if there was, we would expect the tenant in due course to move. That was the debate.
Baroness Anelay of St Johns
May I very rudely interrupt the noble Baroness, Lady Hollis? I am reminded, of course, by those who know the rules well, that if we are to debate this amendment—which we are, albeit very briefly—it is right that the noble Lord, Lord McKenzie, should move it. I will, of course, be able in procedural terms to reply to the noble Baroness, Lady Hollis, and explain the position. However, perhaps the noble Lord, Lord McKenzie, for the sake of the formalities, might quickly like to move the amendment, and then we can deal with the process.
Lord McKenzie of Luton
If it has not been moved already, then I beg to move.
Baroness Hollis of Heigham
My Lords, my case then stands, in other words. I had understood that when the noble Lord, Lord McKenzie, spoke immediately after the noble Lord, Lord Best, he moved the additional amendments, which the noble Lord, Lord Best, had previously indicated he would accept as part of the position.
Baroness Anelay of St Johns
My Lords, I know that this is becoming an aficionado’s debate, and obviously we have to make sure that we understand what is going on.
The noble Lord, Lord Best, made claims about what he considered to be consequential, and I know that he did so in good faith. However, it is not for the noble Lord, Lord Best, to tell the Government what the Government believe is consequential. As a matter of fact, Amendment 17A is not consequential. The noble Baroness, Lady Hollis, might find that I am about to be helpful, so she might wish to hesitate for just one moment. At least, the noble Lord, Lord Bassam of Brighton, the Opposition Chief Whip, might find that I am about to be a little more helpful.
Clearly this is not a consequential amendment. The noble Lord, Lord Best, may want to accept it as such, but it is not procedurally. The Government’s view, if I can make it clear, is that the amendment is not consequential. We do not accept it as being consequential, and will not do so when these matters are debated in another place.
However, the Government have also seen the result earlier on. It is not the Government’s intention to try to unpick some of the debate that occurred earlier. During that debate, at no time did the Minister accept that Amendment 17A was consequential. The position is clearly that when the matter was debated earlier on, other noble Lords felt that if the matter were put to a vote, they might wish to vote along the same basis, but that did not happen.
I am sure it will be to the confusion of noble Lords opposite, but the position, quite simply, is that the Government will not call against Amendment 17A when it is put. I hope that is helpful. The important thing is on the record; I make it clear that the Government will not accept this in another place. I hope the noble Lord, Lord Bassam, finds that useful.
Lord Bassam of Brighton
My Lords, I was waiting for those words, and that is why I had not made a procedural intervention. Having now heard what the noble Baroness has said, I will be content, for the orderly process of business, if the Government accept this. Of course, that is on the understanding that what happens in another place is what happens in another place. No doubt these things will be revisited upon us, as they usually are.
Baroness Anelay of St Johns
My Lords, for the avoidance of doubt, as I say, the Government do not accept the amendment. I will certainly ask my colleagues behind me—including the Minister, who must be wondering what on earth this is all about—that when the Question is put, no person on the coalition Benches calls against it.
Lord McKenzie of Luton
In which case, I think that all I need to do is to say, I beg to move.
“(6) Regulations shall provide that where the award for housing costs is restricted to the shared accommodation rate, this shall not apply for a period of 52 weeks for any claimant aged between 25 years and 35 years, who is not an existing claimant of housing benefit.”
Baroness Hollis of Heigham
I would like to continue the argument with the Chief Whip, but we will move on. Perhaps we will have this discussion outside on the difference between consequential, and the mover of an amendment accepting an amendment to the amendment. That is where the confusion may arise. The noble Lord, Lord Best, certainly did do so.
We discussed shared accommodation rent in Committee, and I have to say that one’s worries remain. At the moment, if you are under 25, you are eligible for Housing Benefit for a room in a shared house. If you are over 25, you are eligible for Housing Benefit for a one-bedroom flat. The Government are proposing that from next month, if you are aged up to 35 rather than 25, after 13 weeks you will get housing benefit only for a room in a shared house, a house in multiple occupation. Some 62,500 people will be affected, losing on average over £40 a week—in London, over £100 a week.
Baroness Meacher
My Lords, I support Amendment 19. I have particular concerns. I fully endorse the point made by the noble Baroness, Lady Hollis, that when people lose their job it is unacceptable for them immediately to face not only the shock of being unemployed and the dramatic fall in their incomes but the prospect of having to move their home. Psychologists always say that it is important to avoid changing more than one of our three mainstays of security in any one year: employment, our main relationship and our home. The risks of mental health problems rise significantly if we do so, as the noble Baroness illustrated very well.
There is therefore a strong case for allowing newly unemployed people time to adjust before they have to think of moving home. Of course the hope would be that they would find work within that year and never have to move at all. I want to raise again a particular problem that to some degree would be assisted by the amendment. I raised this issue in my most helpful meeting with the Minister but have reason to believe that his assurances would not work as he thinks they would. The issue is that of people with severe mental health problems who may be absolutely unable to move into shared accommodation, either because they themselves could not handle having someone else around or because the situation would be untenable if not downright dangerous for anyone else trying to live with them. The Minister assured me that discretionary housing payments should deal with this problem. Perhaps in theory this might be the case, but apparently in practice it does not in fact work. Does the Minister regard it as right for sick people to be penalised when for therapeutic reasons they cannot move into a living space with someone else?
I have a couple of examples to illustrate the point. A woman in her early 30s, living alone in private rented accommodation, receives ESA because of her mental health condition. She already has rent arrears as her housing benefit does not cover her rent. She applied for a discretionary housing payment but this has been refused. She has now been told that her housing benefit will be cut further, of course, in January 2012, when she is only entitled to the shared accommodation rate. She finds it difficult to cope with other people, and could not cope with a shared flat, even if she could find one. The adviser who is dealing with her fears that she could become homeless.
The other example is of a woman in her early thirties with HIV and related health difficulties, including depression. She is regarded as being unlikely to receive a discretionary housing payment until she is 35. I do not know why, but that is what I am told. She comes from a traumatic background, needs regular access to her many medications, and to the bathroom. She is not regarded as someone who could cope with shared accommodation: again, a likely homeless person.
If these claimants finish up on the streets, they will no doubt end up on one of our hospital wards at a cost of £261 per day, £95,000 per year to the taxpayer. I realise that this is a cost to the Department of Health, and not to the DWP, but I know the Minister is broad-minded on such matters and will not want to cause a massive increase in Department of Health costs. I am serious about it. There might be a saving to the DWP, but a much bigger cost in the Department of Health. However, the noble Baroness, Lady Hollis, does not accept at all that there would even be a cost saving in the DWP. There would therefore be a double whammy. We already see people moving automatically from benefits, to losing benefits, then on to the streets, and then into hospital. That is the way the system works, and this measure will simply make matters worse.
Apart from the inappropriateness of shared accommodation for some, though not at all every mentally ill person, there is also the practicality of finding such accommodation for this particular group. Someone with a mental health problem is going to be the last person many people want to share with. We know that the stigma involved is considerable. People are frightened, and they assume that people are dangerous when in fact they are not at all. But also, in reality, some people have difficult personal assumptions which would make them quite difficult to live with.
The result is that these people will not find shared accommodation readily, even if they could cope with it, and many absolutely could not. I know many people on our wards whom we could not discharge into shared accommodation. They would simply sit around on the wards, and it would be a problem.
I have focused on a particular claimant group, but an important one, in view of the numbers of these people. I hope the Minister will be sympathetic to the amendment, for all the reasons the noble Baroness, Lady Hollis, pointed out, but also because it would ameliorate the problem of this particular group of people with mental health problems who, with any luck, might over a year settle down rather further and then might be able to be accommodated within the system.
Baroness Lister of Burtersett
My Lords, I support the amendment tabled by my noble friend Lady Hollis of Heigham. She has painted a vivid and powerful picture of what this means for the people affected. I have sat through and participated in a couple of debates already about this, partly on the regulations, in Grand Committee. The more I have listened and read the evidence, the more uncomfortable I feel about us allowing this measure to go ahead.
When I was younger, I flat-shared. I answered the ads in Time Out, and it is a very different thing. I am sure that many noble Lords may have been in that position, and think there is nothing wrong in sharing accommodation. But doing it from choice is very different from being pushed into it. As my noble friend has spelt out, we are talking about less salubrious accommodation.
I am concerned about various groups who are particularly vulnerable here, as we have already heard. When the Social Security Advisory Committee considered this, it talked in particular about the way women will be affected. Women are not disproportionately affected as a group, but those who will be affected could be particularly adversely so.
There are two groups in particular. Pregnant single women, the advisory committee said, will be restricted to the shared accommodation rate until they give birth. They face one of three undesirable situations. They can move home twice, at a time when they may be financially, emotionally and physically ill-equipped to do so, into shared accommodation, and then back to self-contained accommodation when the baby is born; they can decide to move into shared accommodation and remain there after the birth of their child; or they can try to make up the shortfall in their rent.
Baroness Hayter of Kentish Town
My Lords, as my noble friend Lady Hollis made clear, this amendment addresses the cases of those who, not having been housing benefit claimants, become in need of this, perhaps through the loss of a job, a change in domestic circumstances, illness or some other unanticipated event. It is aimed at the potential impact on vulnerable young adults: single people between 25 and 35, who rent in the private sector and from January will only be eligible for the single room rate, losing about £40 a week. Crisis—which we all know, particularly at Christmas, of course—an organisation that knows a thing or two about homelessness, believes that most of the 50,000 or more people affected are likely to lose their homes.
The amendment does not say that these people would be excused the shared room rate up to the age of 35, but it gives them a window of a year in which to find a new home or a job, to get well, or in some way to change their circumstances so that they are no longer dependent on housing benefit. It would extend the current 13-week breathing space to 52.
This is not just a matter of the individuals concerned sorting out their lives but of allowing the market to respond to these new rules. Research by the University of York on the impact of extending the shared-room accommodation rate found that there is insufficient shared accommodation available at the moment. Indeed, this would risk making such accommodation even harder to find for those aged under 25 as the supply of relevant accommodation takes time to build up. Furthermore, the York study found that sharing can sometimes be difficult or even dangerous, as we have already heard, and can have a serious negative impact on the health and well-being of vulnerable people.
As we have already heard, there are exemptions to the shared accommodation policy, including those for severely disabled people, care leavers aged under 22, people who have spent more than three months in a homelessness hostel and received resettlement support and those aged over 25 who are considered a risk to others. It does not include those who might themselves be at risk. In Committee the Minister reminded us of the other exemptions, such as those for certain ex-offenders who pose a risk to the public and certain former residents of specialist homeless hostels, which might include those leaving a refuge following domestic violence.
However, we also heard in Committee of a number of situations in which shared accommodation not covered by those exemptions would pose a real problem for people. My noble friend Lady Sherlock raised the question of single pregnant women, who may find such circumstances particularly difficult. The noble Baroness, Lady Campbell of Surbiton, raised the issue of those with obsessive compulsive disorder, who may also find the prospect particularly difficult. My noble friend Lord McAvoy, who is not in his position at the moment and is, in his own words, not a social liberal, talked about the situation of those with a mental illness and how they might gradually be forced out of successively worse forms of shared accommodation.
Many of the people caught by this proposed new ruling will be fathers of young children soon after a split, when it is particularly crucial for their relationship with the children to be maintained. If it is not kept close in that first year of separation it is very hard to re-establish it later. That relationship depends not just on shared hamburgers in McDonald’s but on cooking, eating and even washing up together. For this, a place of one’s own, where young children can feel at home—not a house shared with strangers—will be crucial. The amendment relates to that first 12 months, within which we hope finances, jobs or better accommodation can be sorted out. If it is not sorted out in that 12 months, at least it will be much less threatening for those children visiting their now non-resident parent to get used to a different way of living.
The amendment does not reverse the intention of the policy, which the Minister told us was to ensure that claimants make similar choices to those not on benefits. The flaw in his argument is that the circumstances of many of those on benefits are not the same as those who can support themselves. The benefits system is designed exactly to protect people when their circumstances change. The amendment provides a little extra support of this kind. It would give people sufficient time either to address the circumstances—whether job loss, illness or a change in family arrangements—that meant they had to claim benefit, or, at a later time, to find the shared accommodation that best meets their needs. It is a thoughtful amendment, which the Opposition are happy to support.
Lord Freud
My Lords, Amendment 19 from the noble Baronesses, Lady Hollis and Lady Meacher, deals with a subject that we have debated at considerable length—the shared accommodation rate. In case there is any doubt, let me be clear: the shared accommodation rate is what we pay people to share accommodation, not to share rooms, as some people think. We do not expect people to share one room or a bedroom, but to share accommodation.
Baroness Hollis of Heigham
My Lords, I do not think anyone disputes that, but at the bottom end of the market it will be a room in a shared house, which means sharing a kitchen and bathroom, as we have discussed.
Lord Freud
My Lords, it is rather interesting to look at the actual rates. If you take two people, each with their own shared accommodation rate of housing benefit, that covers or exceeds the two-bedroom rate in 60 per cent of localities. We are not talking about a dramatic cut in much of the country. Indeed, if three or four people choose to share a house, taking their own shared accommodation rates, the amount of money that they get would cover the rate for three or four-bedroom properties in 90 per cent of localities. We are not talking about a hugely draconian cut in that context.
If we look at the amendment itself, it is not altogether obvious what rate of housing costs the noble Baronesses are proposing should be paid during the 52-week period of exemption. Since the amendment applies to new claims only, perhaps it seeks to ensure that new claimants have their full contractual rent met for the first 52 weeks, rather than being paid the local housing allowance. If it is the latter, we covered those points in Committee. We debated whether the current 13-week exemption from rent restrictions for claimants who could afford their rent when they first took on that commitment should be extended to 52 weeks.
I need to make clear that rent can be met in full for up to 13 weeks for those who could afford their rent when they first took on the tenancy and have not been in receipt of housing benefit in the past year. This means that those claimants who experience a short spell of unemployment are not forced to move, and it gives others time to consider their housing options. Around 40 per cent of JSA claimants aged between 25 and 49 have been claiming for less than three months, and around 60 per cent for less than six months. For completeness, I should add that there is a 12-month protection for people who have recently been bereaved.
As I said at the time, most claims for housing benefit are for short periods. The 13-week exemption protects a person’s ability to pay their rent during that time. Half of jobseeker’s allowance claimants aged between 18 and 24 have been claiming for less than 13 weeks and less than 5 per cent have been claiming for more than 52 weeks. We already know that more than a third of those who claim housing benefit choose shared accommodation. These are people who could be in either separate-bedroom accommodation or shared accommodation and choose the shared accommodation rate. Of the people who are not on HB, 40 per cent of 25 to 34 year-olds share. I am excluding students from this. This is not a form of housing that is unusual or imposed on people; it is an absolutely normal form of housing.
I accept that there is real concern about the impact of the shared accommodation rate and particularly about the availability of accommodation. I said in Committee that the market will not remain static and that I believe it will respond in time to the increased demand for this type of accommodation. The feedback that I had from officials following their recent meeting with a Methodist housing association suggests that this is already happening. The association is already converting some of its property into shared accommodation. I am also reassured by meetings that I have had with stakeholders that a number of support organisations are helping to match tenants to shared accommodation.
Baroness Hollis of Heigham
I thank noble Lords for taking part. There are very real concerns, not just for women who are going into an HMO where there may be people who appear to them threatening, but also for those who appear to be the threatening ones, for whom it is also difficult. Both sides find this unacceptable. I am also grateful to my noble friends Lady Lister and Lady Hayter who helped to spell this out.
To some extent, the Minister missed our point. None of us has any problem whatever with people who choose to share. It is fine when you choose to share with people you know or when you have gone through an ad in the local paper and gone in to see them. It is fine if it is a salubrious flat and together you can pool your resources. Some may be in work, some may not, but you can manage the rent. That is fine. That is not what we are arguing about. We are arguing about someone who has lost their job and is in a one-bedroom flat for which they are currently able to pay. After 13 weeks, their HB expires and they are only entitled to LHA at a shared room rent. They are forced, against their will, to move into accommodation with strangers at the very same time as we are expecting them and needing them—and they want—to prioritise their search for a job. It is simply silly to undermine their work ethic and their work efforts. Instead, we are diverting and deflecting them into the search for a home which is safe, salubrious and affordable. This is silly and stupid, which is not a charge I would normally address to the Minister, because he is neither of those things.
On cost, I put it to the Minister that it would be reasonable to assume that a woman who had lost her job as, say, a secretary in a firm that had closed would get back to work within six months if her housing position was unaffected. If her housing situation was affected and she had to go in search of new accommodation, possibly ending up in another area, it might take her 12 months. That is not an unreasonable supposition; six months if we accept my amendment, 12 months in the existing situation. The cost of the extra three months of HB is £1,300, based on the assumption of an extra £100 a week. If, however, she did not spend a further six months on benefit, because she got back into work within six months as opposed to a year, she would save the DWP £3,900. Subtract those two, and the additional savings to the DWP, by supporting this amendment, for that one individual person, is £2,500, and that is before you get money from taxes and national insurance. Multiply that by, say, 15,000 people out of the group of 62,000 and the Government would save an additional £40 million. That is where the savings lie.
You can challenge my behavioural assumptions—that you go back to work within six months if you do not have to find another home and that it takes you 12 months if you do—but, from what I know in my city about how long it takes people to find work as the situation worsens, I do not think they are unreasonable. If the assumption is right, and 15,000 of that client group come into that category, the Government will save an additional £40 million, not halve the savings as the Minister suggested. That is nonsense on any behavioural assumptions. He is assuming that what he is doing will make no difference to people’s propensity or ability to come back into work. That is simply untrue, particularly as the economic situation gets worse, and he must know it. He can make savings from the amendment if he chooses to work it through further.
My final point is about safety. A member of my family was in a room in such a situation. There was thumping at his door and he opened it. This person in my family—who is six feet tall and strong—faced, as he opened the door, somebody who was naked with a knife in his hand. Do not tell me it cannot happen, because I know it has and it does. I therefore suggest, on grounds of decency, safety and cost effectiveness, that the Minister consider this amendment further, even if he is not willing to do so today. I beg leave to withdraw the amendment.
“(6) Within one year of these regulations coming into force, an independent research review of their impact shall be laid before Parliament, and such a review to include the effects of such measures on the reduced incomes of social housing tenants and their families, the security of the rent roll of their social landlords, the depletion of tenants’ savings, levels of arrears, levels of eviction, any increased homelessness and use of temporary accommodation, the reduced prospects of pensioners for rehousing, and the likely availability of housing stock to meet the new underoccupancy standards, and related matters.”
Baroness Hollis of Heigham
My Lords, I will be very brief. The amendment indicates our very real concerns about the effect of all these cuts to housing benefit. We fear that if there is any reverse in our decision today on underoccupancy, housing associations will face mounting arrears, and spend more time and employ more staff chasing deficits in rent. As a result, there will be even less chance for those housing associations to build the new housing stock we badly need. I know the Minister thinks my fears are exaggerated. I hope he is right. The House has alleviated most of my concerns, but we cannot properly calculate the behavioural effect of all these changes on tenants. The Minister is evidence based—something we all welcome and respect—and he wants UC to work, as we do. I therefore hope that by the time the Bill has gone through its full passage in both Houses he will, if it is appropriate, find the resources to ensure that we have the research to undertake an independent review of its effects on tenants in social housing. Frankly, if we do not have that protection, I fear the worst. I beg to move.
Lord Best
I support the amendment. We already have up and running, thanks to the good work of the Minister, a really first-class piece of research looking at the impact of the housing benefit changes on families, poverty and a whole range of issues. I strongly congratulate him on taking that suggestion seriously and bringing forward a significant piece of research. It engaged a consortium of the top people at Oxford University, Sheffield Hallam University, Ipsos MORI polling and the IFS. I wondered whether that team might have its work somewhat extended to embrace the research suggested by the noble Baroness. It would not involve quite as much work because it would examine the 150,000 or so households that will now be affected by the underoccupancy arrangements. There is much important research to take place.
Lord Freud
My Lords, I acknowledge and commend the contributions of the noble Baroness and the noble Lord to the debate on policy. Both of them, particularly the noble Lord, Lord Best, played an important role setting up the independent research that the department has already commissioned around the local housing allowance. More recently, as noble Lords are aware, we have announced research looking at direct payments in the social rented sector. However, I must complain bitterly at the improvement to the negotiating position of the consortium that the noble Lord mentioned. When we carry out research, we always have open competition and no one is favoured. We choose the best researchers.
I place real value on independent research. We need robust evaluation on the impact of welfare reform on housing provision. I know that we are taking some steps in housing benefit reform where we need to monitor the risks. I know that there are risks, and we have all discussed them. That is why proper research, considered properly and taken very seriously, is right at the heart of the protections that we are looking at in this area.
I fully support the intention behind this powerful amendment. I want to go on record as saying that. I can tell noble Lords that the department is currently in the process of planning its research programme for 2012-13 onwards, subject, I have to add, to available funding—and I hope that noble Lords do not take that away from me in other ways. I intend to cover the size criteria and underoccupancy in housing benefit. We are considering separately how to evaluate universal credit. Noble Lords will be aware of the constant-piloting clause that we approved in Committee, which provides for a radically new way of looking at this important benefits system.
All research commissioned by the department is published. I am sure that noble Lords will accept that it is not necessary to provide for this research in the Bill. I know that this is a probing amendment and we will look to providing this research at the right time. With those reassurances, I hope that the amendment can be withdrawn.
Baroness Hollis of Heigham
I am grateful to the Minister and to our noble colleague—I was going to say our noble friend—the noble Lord, Lord Best. If I may say so, the Minister enhances an already high reputation by his openness to the information that will come from research. We should give him credit for that and I am very grateful. I beg leave to withdraw the amendment.
“Payment of housing costs
(1) This section applies to payments of the housing cost element of the universal credit.
(2) Payment of the housing costs element of the universal credit must be made to a person’s landlord where that person has requested or consented to such payment in agreement with their landlord.
(3) Regulations made by the Secretary of State may prescribe the circumstances in which subsection (2) does not apply.
(4) Regulations made by the Secretary of State shall prescribe the person who is to be treated as the landlord for the purposes of this section and shall make provision as to the discharge of liability consequent upon the making of any payments to the landlord.”
Lord Best
My Lords, the amendment relates to the payment of help with housing costs—at present in housing benefit and later as the housing cost element of universal credit. The Minister has announced that in future the payment for rent must go directly to the tenant, not, as is possible at present, to the landlord. The amendment preserves the current option for the tenant to choose that the rent should be paid straight to the landlord where the tenant thinks that that will help with their budgeting and housekeeping.
When I introduced a similar amendment in Committee, I pointed out that private landlords were already often very reluctant to take on tenants in receipt of housing benefit or local housing allowance. However, where the benefit is paid straight to the landlord, thereby minimising the chances of arrears, the reluctance of landlords can be much reduced. There is backing for the amendment from the private sector—the Residential Landlords Association, the British Property Federation and others. There is also backing from social landlords. This morning at the LGA, I addressed a conference on housing finance and was surprised at how strongly local authorities expressed their view that the direct payment of rent to tenants would lead to arrears and difficulties for councils in handling housing accounts. The amendment is also strongly supported by those who represent tenants—residents in the rented sector. Associations of residents in social Housing—TARAs—Shelter, Crisis and others are right behind the amendment, not least because surveys have shown that a high proportion of tenants would wish for their rent money to go to the landlord.
The Government have agreed that this choice will be available to those of pension age. This amendment would extend that possibility to make this kind of sensible choice available to all tenants. The housing associations organised a pilot of their own in which they experimented to see how things worked out when rent was paid directly to the tenant. They found that arrears increased from 3 per cent to 7 per cent. If that was applicable generally, the cost to the housing association sector would be some £320 million a year in additional arrears. Local authorities have a similar stock of social housing which would double the figure to some £640 million a year. Housing associations also discovered that their administrative costs were very much higher when the rent did not come straight to the landlord in the form of housing benefit or—in future—the housing element of universal credit. The extra costs on administration for that are estimated at £100 million.
If housing associations face those kinds of costs, the hazard is that lenders will not be so keen to lend to them. The Council of Mortgage Lenders is in favour of the amendment, as are the individual lenders, because they worry that housing associations will get into difficulties if they do not get the rent that they need. The Minister has set up some important pilot schemes to test ways of assisting tenants to handle the money provided for rent, and new arrangements for low-cost banking may be developed in the months and years ahead. However, the Minister undertook to look further at the option of giving more vulnerable tenants the right to choose to have their rent paid to the landlord. I know that he has been considering how a fast-track arrangement might be implemented to switch the payment of rent from tenant to landlord when arrears are mounting.
These changes would be useful but they do not address the fundamental problem. Surely the best approach is to continue to give tenants the right to choose to have their help with housing costs paid directly to their landlord, and not to give them the temptations which are bound to be placed in their path if sums, perhaps in the region of £500 or £700 a month, were paid to them, and possibly used to satisfy the requirements of loan sharks and less salubrious lenders and creditors, rather than paid to their landlord. Can we not preserve the existing right of tenants to choose to be assisted in their budgeting? I beg to move.
Baroness Howe of Idlicote
My Lords, having listened to that explanation from my noble friend Lord Best, I have been completely converted to this approach. I certainly appreciate that the Minister is trying to educate people better to take care of their own finances, but the choice already exists for the individual tenant to decide whether to pay for themselves or to opt in to a system which is, from what we have heard, more satisfactory and reassuring to the landlord—whether a local authority or whoever. As all of us in this House are beginning to get a little older and, sometimes, a little forgetful, perhaps that is a helpful thought for later, when we get even more forgetful about things such as paying our rent.
All I am saying is that this sounds the better way to do things. I am all for running courses to help people to cope better with their finances, but from the point of view of not wasting money, this is clearly a way forward.
Baroness Hollis of Heigham
My Lords, I would prefer housing benefit to be part of UC and to be paid to the tenant, because I think that that strengthens UC and makes it easier for one simple calculation to be made for the family. However, I support the amendment because, until the Government have rock-solid arrangements in place to ensure that the rent element in UC is immediately paid to the landlord, both tenant and landlord will, as the noble Lord, Lord Best, said, suffer.
Why would the tenant suffer? He may have to pay transaction costs. If it is looped through his bank account and there are any outstanding overdrafts, debts, or whatever, his UC, including the housing element, will be top-sliced. That is when there is no temptation to spend it on other things. I checked with my housing association. Even with direct debits from tenants in work, those direct debits go astray—deliberately or otherwise—and intensive work has to be done in housing management to reconstruct them again. Tenants can risk losing their home if rent payments are not made automatically to their landlord. For some tenants, that will be a real struggle. If tenants wish to have their rent paid directly to their landlord, but that choice is being denied them, they will suffer.
Why will the landlord suffer? Arrears will undoubtedly arise. I have doubled the amount in my housing association accounts because of potential arrears that I suspect will follow from this change, as have other housing associations. We will then also have to increase staff resources to try to collect those arrears. Private landlords, already reluctant to take DWP tenants, will certainly refuse. One reason for extending direct payments in the first place was to make it a more attractive option for landlords in the private sector, who have been notoriously reluctant since the 1950s to make accommodation available. They used to say, “No Irish, no blacks, no DSS, no dogs”. Versions of that scrutiny, that winnowing out, I fear regrettably still apply.
Ultimately, landlords may need to face evicting tenants. As many of those who cannot manage their money will be vulnerable, they may or may not be regarded as intentionally homeless. If they have children, they are a real problem for all parties, including social services.
Furthermore, housing associations, including mine, are seeking to raise money from private sources, from banks—even, we hope, from pension funds, which is under negotiation at the moment—for building programmes. Our asset is the security of our rent roll. If tenants instead have money paid to them which is not rock-solidly paid immediately to the housing association or the local authority, that rock-solid asset base will no longer be as valued. We estimate that the proposal will cost us something like 50 base points extra on all the loans we raise. We become a worse risk and, as a result, fewer homes will be built. An amendment putting the decision in the hands of not the DWP or landlords but in the hands of tenants is surely the right way forward.
Baroness Lister of Burtersett
My Lords, I shall speak briefly in support of the amendment moved by the noble Lord, Lord Best, from a slightly different perspective, and repeat what I said in Grand Committee. In Grand Committee, I congratulated the Government on their research, Perceptions on Welfare Reform and Universal Credit, which sounded out various stakeholders about what they thought about some of the reforms. One thing that came from that from people who will be affected was that although they welcomed the one-stop shop approach of universal credit—to the extent that it is a one-stop shop—there were real fears about putting all the eggs in one basket. If all the money goes together in one lump sum, if anything goes wrong, people are left insecure—high and dry. If some of the rent payment is going to the landlord, where the tenant wishes it, that is mitigated. That is why that choice should remain
Not expressed in this research but by a number of outside organisations is the worry about what happens to the money in the family. I know that the Minister argues that budgeting accounts will sort this out. I hope that they will, but I think that he knows that I am still slightly sceptical about the magical powers of the budgetary accounts. There are fears that the money may not be paid into the account of the person responsible for paying the rent and that they may not then have control over how the money is spent by their partner. That is a slightly different perspective from that of the noble Lord, Lord Best, who understandably and powerfully is relaying some of the concerns about housing providers, but we have to think about the extra burden that this might be placing on some families.
Lord Cormack
My Lords, the noble Lord, Lord Best, has made a powerful case. He made it very gently but forcefully. I was also struck by what the noble Baroness, Lady Howe of Idlicote, said. As one who held MPs’ surgeries for about 40 years and saw people come in who were often in considerable distress, I know that it is not just the feckless who get into financial trouble. Many decent people get into financial trouble. The ability to say that this money should go direct to the landlord could be of enormous help to someone who suddenly has a sick child and feels that they must spend the money on that child. If the money has gone to the landlord, the landlord is secure and the tenant is secure. That must surely be wholly desirable.
Those of us who have been constituency Members of Parliament know how difficult it is to persuade private landlords to consider tenants in this general category. We need an abundant supply of privately rented accommodation. Anything that may detract from that is to be regretted.
I admire my noble friend, because he is thoroughly the master of his brief and because his underlying aim, which is to create a more responsible society, is one to which we can, surely, all subscribe, but there are exceptions and times when it is right to give a choice.
Another point, which the noble Baroness, Lady Howe of Idlicote, made, struck a chord with me. There are many elderly people in receipt of benefit who get confused. I am not talking about people who suffer from dementia, but we all know—the noble Lord, Lord McAvoy, knows from his constituency experience—that elderly people sometimes get confused. They think, very genuinely, that they have paid something when they have not. It would be a great blessing to give those people that choice.
I would urge my noble friend the Minister to give very careful thought to this. I hope that the House will not divide on it tonight, but I hope that he will be able to give some thought perhaps even to putting down an appropriate amendment at Third Reading.
Baroness Hayter of Kentish Town
My Lords, dinner beckons. Nevertheless, there are seven good reasons for accepting this amendment.
First, it is cost free. The facility to pay rent directly to landlords is there for certain beneficiaries, so it would simply be a case of using this for others.
Secondly, it helps to give financial responsibility and decision-making to claimants, as it would allow them to choose to have the rent paid in this way.
Thirdly, it is what the rest of us do with our mortgages or rent: it goes straight out of our bank accounts, normally the day after payday—in my case, usually the same day—so that we cannot get our hands on it in the mean time. The difference is, of course, that many of these claimants do not have bank accounts, or a joint bank account if they are a couple, and therefore do not have the ability to make such arrangements for direct payments. Furthermore, if they have a basic bank account, such accounts cannot go into the red, and so if there is not money to pay the rent, it simply will not be paid, even with a direct debit mandate, leading to the build-up of arrears.
Fourthly, this amendment is strongly supported, as has been said, by housing associations and by local authorities. Both know that arrears will build up more quickly without this amendment. For housing associations, the interest on borrowing will increase as their assured-rent income will decrease. To give the example of one housing association, 85 per cent of Riverside tenants choose to have their rent paid directly, as many of its tenants do not have bank accounts, and many more fear the bank charges if they go overdrawn. This is an important way for low-income households to manage their finances. If this existing facility is withdrawn, pilot studies show that, as has already been mentioned, rent arrears are likely to rise sharply, putting tenancies at risk. In addition, funders have indicated that they are likely to regard lending to housing associations as higher risk and thus to increase the cost of funding. In the long term, it will mean that social housing providers will simply be able to do less. Income streams to local authorities will similarly be threatened if direct payments, which exist now without any problems, are ended. CoSLA, the association for local authorities in Scotland, estimates that this will cost about £50 million a year in Scotland alone.
Fifthly, many vulnerable families will be at risk. To quote again from CoSLA:
“COSLA is deeply concerned that Housing Benefit paid direct to claimants without sufficient safeguards will result in an increase of rent arrears and evictions, sending households spiralling into debt and facing homelessness”.
We know the families for which the risk of not paying the rent directly will be the greatest: those with debts, where the pressure to pay these off—whether to the gasman or to the loan shark—will be pressing; those with a family member with a drink, drug or gambling habit, where temptation to use the rent money will be high; and those with immediate demands, as the noble Lord, Lord Cormack, has said, for money to feed their children and yet who want to ensure that the roof over those children’s heads, albeit not today’s problem, is equally vital, so want to have that rent assured. While we know some vulnerable groups will have their rent paid directly, we can see no reason to wait until borderline cases get into problems, struggle and get into rent arrears, before we allow them to have the rent paid directly. Why risk that for no good reason?
Sixthly, it will make sure that we do not dissuade private landlords from coming into this sector.
Seventhly, the strongest argument: the noble Lord, Lord Best, who chairs the Local Government Association and has forgotten more about housing associations than most of us will ever learn, tells us it is the right thing to do. We concur.
Lord Freud
My Lords, my intention is to reassure the noble Lord, Lord Best, so that he withdraws his amendment. I start by trying to convince the noble Baroness, Lady Howe, and my noble friend Lord Cormack of the reason why we are doing this. It is not an arbitrary thing. We are not doing it because we want to annoy housing associations or local authorities. We are doing it for a very simple reason. If you are a tenant in social housing whose housing benefit goes straight through to the landlord and you take a job, all your arrangements for paying for your housing have to change. It is a major change in your arrangements and a real block on you taking the job. It is a major thing for you to organise, and you have to learn, when you take that first job and your housing benefit goes down within universal credit—because that is the change—that the money no longer goes through automatically to the landlord.
We have to break that link. It has to be the same arrangement whether you are working or not working. We deliberately excluded pension-age people from this because we are not expecting them to work. We do not need to worry about the people who find it difficult to work. It is working-age people who we want to go into work.
Baroness Meacher
I listen to the Minister’s passion—“We have to do this, we have to do this”—and I find myself thinking that that would be fine if we were in normal circumstances and the benefits were not changing but were pretty much going on as they always have, and people were not going to be facing major drops in their benefit levels or having to adjust to having to move because of all sorts of rules about underoccupancy or because of the tying of benefits to the consumer prices index and so on. There are so many ways in which people on benefits are going to be losing—that is the context—and this is not the time to be determined to bring all these people into line with people in work. Can we not wait until things are stable and then maybe introduce the rather nice idea of bringing these two groups together?
Lord Freud
The answer to that is very simple: the universal credit will, each year, inject an extra £4 billion into the pockets of the poorest people. That is what the universal credit does. It will start coming in in 2013-17, when hopefully the laws of the business cycle will still be working and we can expect an upturn at some stage. As we move into that situation, the concern will be what happens to the universal credit. This measure is for universal credit. It does not stand outside it.
Baroness Meacher
I apologise for interrupting again, but £4 billion is surely a tiny amount relative to the losses in projected benefits. This huge budget would normally go up very extensively each year, would it not? I do not have all the numbers in my head, but £4 billion in a tiny fraction of the actual real losses in benefit that people are going to face.
Lord Freud
Absolutely not; £4 billion is a very substantial figure. Over the course of this SR, we are looking at a loss of £18 billion spread over the four-year period. The noble Baroness can do the sums. The most important thing about universal credit is that the money goes into the pockets of the lowest two quintiles very efficiently. I contend that the noble Baroness’s argument is not a real argument.
Baroness Hayter of Kentish Town
My Lords, if I understand the Minister correctly, he is saying that this is all part of getting people off benefits and into work, which we absolutely support. However, this will also cover those people who are never going to work—those in the support group—as well as people with young children who are not in work for some time. Therefore, we are not talking only about people who are on the cusp; even those people will lose the right to have their rent paid directly.
Lord Freud
No, my Lords. We have made it absolutely clear that we expect those who are vulnerable to continue to have payments made directly to the landlord. Indeed, in the private rented sector, where this process has already been in place and has worked rather well, 80 per cent of people pay their landlord directly, and 20 per cent are regarded as vulnerable and have a payment made directly to the landlord. That is how it works there. At the moment in the social rented sector, 95 per cent have direct payments and 5 per cent pay the landlord themselves. Therefore, there is a real disparity there.
I want to provide some reassurance for noble Lords who think that this is a draconian measure. I need to explain to the noble Baroness, Lady Howe, and the noble Lord, Lord Cormack, that we are doing this for a real reason. It is not arbitrary; it is intended to make sure that there are no artificial barriers for people who would stay in the comfort zone of not working. We need to make it easier for them to make that transition, and that is one thing that we are doing. This will empower people and allow them to manage their finances.
I shall now come to the reassurance factors, which I hope will have noble Lords nodding happily on the Benches. I am determined that, while we introduce this system, the housing sector will remain financially stable. I talk regularly to banks and to rating agencies in particular about what we need to do to make that happen. I am absolutely convinced that we can have our welfare cake—the transformative cake—and financial stability for the housing sector. I shall do nothing that undermines the security of the housing sector in this area. I absolutely understand that this country needs more housing, and it would be madness for us to undermine that ambition.
I completely understand the two imperatives here. We are working closely with local authorities and housing associations in running half a dozen demonstration projects, which are designed to find out exactly how to make direct support payments for housing costs so that they work with universal credit. I have been incredibly pleased that the industry has shown real enthusiasm for taking part in these demonstration projects, with no fewer than 70 different groups looking to join in. During the selection process, we have been delighted at how much choice we have had, and we are finding out what is going to work to get the two things that we need. These demonstration projects will allow us to identify those who are likely to struggle financially. The projects are testing not whether we should introduce direct payments but how to support landlords and tenants ahead of the scheme being introduced. The important part is to get the safeguards operating properly. We need to see when people are not able to handle the system and switch payments to the landlords, and then find out how to recoup the money over the period when landlords do not have it so that their security of income is locked into the system. That is what we are trying to find out here.
The noble Lord, Lord Best, mentioned the London & Quadrant research, and we are aiming to apply that to the demonstration projects. It shows the importance of communications. Clearly, we want to improve the outcome and throw out the doubling of arrears.
Baroness Drake
I speak as someone who is rather preoccupied with financial inclusion. The Minister is describing a process, but if there is a product—a bank account—that works for low-income or unemployed people and the account is in debt, how does one know that the bank will pay the direct debit? Can he be confident that it will pay if there is a deficit in that account?
Lord Freud
That is exactly what we need to ensure and that is exactly what we are discussing with the banking groups. Specific banking support is exactly the issue that we need to get right.
Lord Cormack
My noble friend is trying to be helpful and I appreciate that very much. Is he saying that this amount of money that is earmarked for paying the rent will be used for paying the rent and for nothing else, and that, unless he is assured that he has the product that will deliver that, he will not move in this direction?
Lord Freud
I am saying that we are working really hard with the banks and the banking community to make sure that we have an escrow arrangement of that nature, and we are doing this at several levels. We can have a general agreement, which I shall discuss with the banks as a whole, to provide a generalised protection. However, I am quite interested in getting particular banking products that will provide a simple bank account and elaborating on what could be a new level of support for some of the poorest people in our community. We have a one-off chance with universal credit to ramp up support for the poorer people in our community, and we are putting a lot of energy into achieving that. I have talked about this before. It is one of the hidden gains that we can get out of the introduction of this new system. Rather than people living on drips of money from here and there, we can really start to help them, supporting them in managing their finances and getting true independence. This is a core part of what we are going to be doing with universal credit, and part of that relates to housing. Housing will be a major part of people’s total income stream. We are not doing this for fun or to annoy anyone; this is absolutely part of what we are trying to do with universal credit.
I need to deal with one other point—the issue of safeguards raised by the noble Baroness, Lady Lister. We are concerned about the safety and welfare of claimants and, where we have a concern, we need to put direct payments in place. There are vulnerable groups who are not able to manage the potential freedoms, and for them we will make sure that we go on with existing arrangements for direct payments.
We have commissioned a consortium led by Professor Paul Hickman—I am sorry, but this is a bit of an announcement late at night—from the Centre for Regional Economic and Social Research at Sheffield Hallam University to evaluate the effects of direct payments to claimants in the six demonstration project areas, which I shall announce soon. The other key team members are Dr Kesia Reeve, Peter Kemp of the Oxford Institute of Social Policy, and Stephen Finlay from Ipsos MORI, names that I know that the noble Lord, Lord Best, approves of. That will give us a cumulative understanding of the impacts of direct payments and inform the detail of delivery under universal credit.
Research published by the Joseph Rowntree Foundation in 2007, Paying Housing Benefit to Claimants, on both private and social tenants’ experiences of and their hypothetical attitude toward the management of their own housing benefit confirms that a significant proportion of social tenants have the potential to manage their own housing benefit payments. We will also have an advisory group for the demonstration projects and a wide range of local government, money advice, voluntary sector and other external stakeholders who will be invited to join that group.
We had a slight exchange about what “choice” means and we have been teasing each other about the imbalance of power when you have choice. It concerns us that while there is theoretical choice today, only 5 per cent of people take it. As it stands, tenant choice does not go far enough, which is why I am concerned about it. I hope that the noble Lord, Lord Best, will accept that we are making incredible efforts here to be transformative and not to undermine the housing sector, and on that basis will feel that there is enough going on for him to withdraw this amendment.
Lord Best
My Lords, I am very grateful to all of those who have joined this debate. I am sure that we all feel much reassured by the passion that the Minister brings to this subject and by the genuine efforts that he is making to see that the behavioural change that he wants is triggered and that the disadvantages of going down this route are mitigated. The excellent research that he is announcing tonight—and I thank him very much for it—might show that it is not possible for only 20 per cent of the tenants within the social sector to be regarded as vulnerable and to have their rent paid directly and that there is a rather larger number.
However, I think the Minister is keeping an open mind as to what proportion of the sector will get their rent paid directly, and I greatly welcome him saying how much he is concerned not to undermine the social housing sector, the production of new homes, the sector’s lending and the security of income within that sector. If those discussions with bankers fail and the products do not materialise, we must place our faith in the Minister and hope that he will recognise that the difficulties still exist and that rent direct to the landlord is going to be necessary for a larger proportion of people. On that basis, I am happy to withdraw my amendment.
National Well-being
(13 years ago)
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Baroness Tyler of Enfield
To ask Her Majesty’s Government what steps they are taking to promote and measure well-being and what role public policy should play in shaping national well-being.
Baroness Tyler of Enfield
My Lords, I would like to thank noble Lords who have found time in this very busy period to speak in this debate and I hope that it has not been too much to the detriment of their own well-being.
Why would I want to talk about well-being today and why do I think that it is important? We all know intuitively what well-being is but there is as yet no standard definition. There is general agreement from the growing body of social science research that a combination of physical, social, environmental and psychological factors influence well-being. Good mental and emotional health is a crucial element of well-being, but by no means the whole story. A good deal of work has already been undertaken to measure well-being and happiness at community and individual levels. This has demonstrated positive factors, such as good relationships, being employed and being financially secure, along with negative factors such as poor relationships, family bereavement, poor health and unemployment.
Back in 2008 the Government Office for Science’s Foresight report on mental capital and well-being referred to mental well-being as,
“a dynamic state, in which the individual is able to develop their potential, work productively and creatively, build strong and positive relationships with others, and contribute to their community. It is enhanced when an individual is able to fulfil their personal and social goals and achieve a sense of purpose in society”.
I think that sums it up very nicely.
Many thinkers, commentators and social scientists are giving the issue of well-being an increasing amount of attention and the idea has started to creep into the mainstream of public policy and political thinking. All three parties are starting to talk about well-being and quality of life, albeit in their own ways and using their own language. I would go so far as to say that it has prompted quite a deep philosophical debate about the central purpose of public policy and indeed government itself. I sense a greater recognition that economic growth is a means to an end rather than an end in itself and that good government is ultimately about improving the lives and well-being of our fellow citizens. But it is undoubtedly a very tough time to be having these sorts of ideas and of course sceptics are bound to view it as a distraction from our very pressing economic concerns.
In November 2010 the Prime Minister announced:
“From April next year we will start measuring our progress as a country not just by how our economy is growing, but by how our lives are improving, not just by our standard of living, but by our quality of life. We’ll continue to measure GDP as we’ve always done, but it is high time we admitted that, taken on its own, GDP is an incomplete way of measuring a country’s progress”.
He added—and I give him all due credit for doing this:
“To those who say that all this sounds like a distraction from the serious business of government, I would say that finding out what will really improve lives end acting on it is actually the serious business of government”.
The practical outcome is that the Office for National Statistics has been tasked with consulting on the development of new well-being measures that cover the quality of life of people in the UK, environmental and sustainability issues, as well the economic performance of the country.
Well-being clearly depends not just on the circumstances of people’s lives but on how they interpret and respond to those circumstances. Recent welcome policy initiatives, such as the promotion of emotional resilience among children in schools and the expansion of psychological therapies focus, on which I am sure we will hear more from the noble Lord, Lord Layard, all rightly recognise this. On the bright side, the very recent ONS statistics, which came out in December, found that around three-quarters of adults in the UK rated their own life satisfaction as seven or more out of 10. These findings also found that having a partner and being in good health were positively associated with life satisfaction. Some people considered these results surprisingly positive, given all the doom and gloom around, and it sparked the inevitable quips about the usefulness of what has been dubbed the “happiness index” from various quarters. Next year we will have much richer data when the ONS has the results from the full 200,000 households that are currently being surveyed.
I believe that a single national measure of well-being should help generate a national debate about what really matters to people. “If you treasure it, measure it” is a good adage. It will be relevant to government, of course, but also to employers, the media, the producers of consumer goods and many others involved in our national life. Others are calling for a wider set of indicators that local communities can use to measure their population’s well-being against other communities. Given the general thrust towards localism, this has much to commend it, and I would be very interested to hear from the Minister what he thinks on this.
There is much evidence, to which I have alluded, about what is important to well-being. It includes income, loss of income, unemployment, being able to do interesting and stretching work, the number of hours worked, commuting, consumption decisions, debt, being able to walk around the local neighbourhood, being able to participate in community activities, volunteering and trust in local institutions. It is a very long list. I do not have time to go through it in any detail here. Evidence shows a clear relationship between levels of well-being and inequality when different countries are compared. Well-being tends to be lower in countries with higher inequality of income and wealth. It is important to understand that. Equally, in terms of what drives well-being, evidence from surveys and research is quite consistent about what matters most in people’s lives. Individuals across nations and social classes put more value on non-monetary assets than on their financial situation. Indeed, quite often in surveys the biggest factors by far that influence people’s happiness are their family relationships and their relationship with their partner.
Turning to the workplace, Dame Carol Black’s review of the health of the working-age population in 2008 identified business as a key partner in promoting or otherwise adult health and well-being across Britain. According to that review, the annual economic costs of sickness absence and worklessness associated with ill health and well-being were over a staggering £100 billion, which is greater than the annual budget of the NHS.
Where does all this lead me? I would like to draw three conclusions. First, well-being should be a key political priority, as it encompasses the things that are most important for our society as a whole and to us as individuals. While prioritising well-being includes ensuring that we have a stable and thriving economy, it crucially also takes a much broader view of success than can be measured in just economic terms.
Secondly, we should warmly welcome the fact that the UK Government are now measuring people's subjective well-being in a substantial and meaningful way. I think it is important that we keep a cross-party consensus going on the importance of this. Thirdly, we need to move rapidly from measurement to action. Measurement on its own achieves very little, so it is essential that we reshape the processes of policy development, implementation and evaluation to take well-being into account as soon as we can. There are some encouraging signs here, with the Cabinet Secretary, Sir Gus O'Donnell, already ensuring that guidance for policy-makers is being updated so that well-being is taken into account. That includes the Treasury Green Book, which will be well known to some, and the setting up of the Social Impacts Task Force within government. Taken together, I very much hope that these measures will finally lead to that holy grail of truly joined-up policy-making in Whitehall. I know from many years’ experience in Whitehall how very difficult that is.
I welcome this focus on practical action. Nowhere is this more important than in family policy and the services available to support families and children, including help with parenting. We heard recently from the 2011 UNICEF child well-being report that British parents often feel stressed and lack the time or, indeed, the confidence to build a strong nurturing relationship with their children and family. Sometimes that gap is filled by a focus on material things and consumer goods. The message from children themselves was clear. Their well-being centred firmly on being able to spend time with a happy family whose interactions with them were consistent and secure, having good friends and having plenty of things to do outside the home.
That is why I think that personal, social and health education, focusing on the importance of relationships, is so critical and should form part of the core national curriculum and include a strong focus on emotional well-being. It is no co-incidence that schools that have pioneered this sort of approach, where well-being and building positive relationships run through the whole school ethos and curriculum and where counselling is available for those who need it, say that there is a clear link to improved academic performance. It is also why I would like to see counselling and other types of emotional support available in all schools in England, as it is currently in Wales and Northern Ireland.
I can think of no better way of concluding my opening remarks than to quote the oft-quoted words of Bobby Kennedy in a speech more than 40 years ago. I know noble Lords will have heard them before, but I will say them again. He said that GDP,
“does not allow for the health of our children, the quality of their education or the joy of their play ... It measures … neither our wisdom nor our learning, neither our compassion nor our devotion to our country, it measures everything in short, except that which makes life worthwhile”.
Baroness Sharp of Guildford
My Lords, I thank my noble friend Lady Tyler for raising a very interesting and important question. I attended the seminar held about six weeks ago in Portcullis House at which Sir Gus O’Donnell spoke about the work that the Office for National Statistics is doing on measuring well-being. I am interested in this topic because, as an economist, I have always been aware of the shortcomings of GDP measurement and of how much more there is to life than just the goods and services on which monetary value can be placed. Yet there is the difficulty of developing any proxy that tries to measure these other things in life. I remember the early days of cost-benefit analysis, when we had the Roskill report on the third London airport and the lengthy deliberation over what value one would place on a Norman church. The value that was put on it in the study was the value that the parochial church council had placed on it for insurance value, but the council admitted that that was the value that it felt it could afford to put on the church rather than any real valuation.
There are very real difficulties here, and there is the conundrum that many of us have pondered over for a very long time. I was an assistant lecturer at the LSE with the noble Lord, Lord Layard, in the 1960s when the Roskill report was being deliberated over. I remember even then, at the time when GDP was going forward on a fairly regular basis, there was the conundrum of why it was that if we were all getting so much richer, we were not feeling happier. This is a fundamental question that the noble Lord, Lord Layard, has been asking for some time.
I wanted to speak in this debate because I want to share with the House my experiences over the past six months when I have been leading an inquiry looking at the role of further education colleges within their communities. It fits into the scenario of the Government giving further education colleges greater flexibility over decisions about how they should spend their budgets. I was sponsored in this inquiry by the National Institute for Adult and Community Education, the AoC and the 157 Group of colleges. My remit was to look at the role that further education colleges do and can play within their communities and the added public value that their leadership can bring to those communities. It led me to do a lot of reading, a lot of visiting, a lot of talking and a lot of thinking about this subject.
My visits were perhaps disproportionately to very good colleges classed as outstanding by Ofsted. What hit me more than anything else was how brilliantly some of our colleges are reaching out to their communities and working with them in all kinds of different ways, not only in spreading the message of learning and skills but giving to those communities the self-confidence and the self-esteem that give them a much greater sense of community and, from that sense of community, a greater sense of well-being.
I would like to give three illustrations of the sorts of activities that I experienced. I visited a community hub in Bolton where the college worked alongside the local authority, using an old primary school in an area that was acknowledged to be disadvantaged. It had been going for some 20 years, and it provided the community with anything and everything from cookery classes and knitting groups through to adult literacy and numeracy. It also ran a youth group that had attached to it a boxing club and a cycle club. It served old and young alike. Graduates from the community hub had gone on to other college courses—access courses, A-levels and degrees in social work—and a lot of them had come back, stayed within the community and worked as community leaders and at the hub itself helping to bring others in. They were the activists and community leaders there; they instilled a sense of community and pride within the neighbourhood. It was this hub that organised street parties for the royal wedding. The cycle club had a sponsored ride from Land’s End to John O’Groats, raising money for a local charity. The boxing club was winning trophies all across the north-west, and they were extremely proud of it. The hub was very much the centre of the community, organising it and giving it a considerable sense of pride.
Another college that I visited did a great deal of youth work. It linked up with local youth clubs, the local police and youth offending teams. It provided for those young people facilities where they could meet, sports activities such as football and basketball, in addition to things like motorcycle maintenance classes. It brought in young people to use the college facilities so that they might get used to the idea of coming into college. Having seen the facilities and the classes that were being run, they might be induced to sign up for some of them. They turned from being NEETs—those not in employment, education or training—into being in training and very often going on to further qualifications. Again, it was an obvious linking up.
At another college, the principal discovered that the local PCT was having great difficulty in meeting its young people’s well-being and health targets. He said, “Well, why don’t you come and work from within the college?”. This was set up and the PCT within two weeks had hit the yearly targets which it had failed to meet for the previous two or three years. It now provides within the college a well-being centre for young people. It is a win-win situation, because the PCT has hit its targets; teenage pregnancies are noticeably down within the community; and college attendance rates are noticeably up. In addition to that, the nurse function within the college is now paid for by the PCT, which provides the staff for the well-being centre.
I found all this extremely encouraging. It seemed to me that there were three elements in this success. One was leadership, another was partnership, and the third was vision. The college leadership provided the catalyst for those partnerships to be formed, and the partnerships led to greater involvement in the community. Social energy is unleashed. As a result of this activity, I found myself reading over the summer the work of the Royal College of Arts on social productivity. It seemed to me that this activity displayed precisely what the college was describing. By involving people in these activities, you could unleash social activity which gave people the confidence and self-esteem which led to well-being. I coined the term—and this is the title that I gave to my report—“dynamic nucleus”: colleges could be like the centre of a Catherine wheel, as a catalyst, sparking off through partnership all kinds of other activities. These activities can add considerably to social well-being.
The Lord Bishop of Chester
My Lords, I think that the time permits me to speak briefly in the gap. I was not sure that I could be here in time for the debate, so I did not put my name down.
Well-being is a very fluid and flexible word, as we have heard. It is quite closely correlated with happiness. Surveys of people in employment in different professions show the clergy as among the happiest groups of workers in our country, which I do not believe has any correlation with GDP.
Certain things such as well-being or happiness arise best if you do not try to achieve them directly. Some things in life are a bit like the soap in the bath: if you try to grab hold of them, they slip out of the hand. It is a little like the character of love: you cannot force someone to love you, whoever they are. I cannot get one of my clergy by the scruff of the neck and say, “You will love me, won’t you?” They may well squeak back, “Yes, Bishop”, but I know that they will not really mean it. Love has to arise out of the truth, the reality and the richness of a relationship, but you cannot force it. Often in the long dynamics of a happy marriage, it is as the partners in a couple realise that they have to let the other person be who they are and not try to change them into what they would like them to be that the happiness in a marriage often develops better. In the average marriage, each partner tries to change the other one into what they would like them to be. This causes trouble for about 20 years; then they give up and are happy.
While the Government of course have a place and a role to play, part of the wisdom of government is to realise the limited place that it has. If I were to look to the future and to well-being, it would be to allow our children to be children. The surveys of the well-being and happiness of children in our society are a major worry. I correlate that partly with the fact that we start children at school so young compared with many other countries. We almost try to force children on life’s journey too soon. The same is true generally of the place for what I call the intermediate institutions between government and the individual. We tend to see an oscillation in our society between the power and reach of government and perfectly proper emphasis on the freedom and rights of the individual. Both are key aspects of the dynamics of society, but they very easily squeeze the intermediate social or human institutions, which are largely those which promote well-being and happiness. We have gone through a period of almost trying to grasp after well-being too much.
In our increasingly diverse society, key to promoting well-being is to recognise that diversity, to allow a genuine tolerance, even of things that we do not particularly like ourselves, and almost to get into the way of thinking, “That is the way in which a mature, diverse, pluriform democracy will have to work”. To some extent, that means the Government employing a self-denying ordinance.
Perhaps I may end by quoting a verse from the Bible—many on these Benches are very loath to do so in your Lordships' House. One of my favourite verses is simply:
“But seek ye first the kingdom of God … and all these things shall be added unto you”.
Happiness and well-being are in a sense the other things that are added unto us, but it is only if we divert our attention to truth, beauty and justice and all those other values that real well-being and happiness will emerge, as a by-product in one sense but as a real fruit of that perspective.
Lord Layard
My Lords, I congratulate the noble Baroness, Lady Tyler, on proposing and securing this debate. I strongly agreed with everything that she said.
I do not think that there is any issue more topical or more urgent than this. Even before the economic crisis began, people world wide were beginning to question whether economic growth really should be the key touchstone of the policies of their Governments. “Surely”, people were saying, “human well-being must be the ultimate goal”.
Among governmental organisations, the greatest credit goes to the OECD for being daring enough to highlight this issue in 2004 when it began the first of its great conferences on defining progress. When it comes to individual countries, Britain is seen world wide as being the country, other than Bhutan, which has done more to promote well-being as a government objective, to think about it and to move towards measuring it. It is fair to say that many people around the world are looking at Britain to see what lessons can be learnt from how we are handling these issues here.
Of course, this started under the previous Government. We had well-being divisions set up in many departments, including health, employment, education and environment, and in 2009 the Office for National Statistics began its work on how to measure our national well-being. That said, of all the political leaders in the advanced world, our present Prime Minister has been outstanding in championing the idea that well-being should be a central, if not the central, objective of government. He said it in 2006, when he first became leader of the Conservative Party and talked about general and national well-being, and he said it even more emphatically when the measurement exercise was launched last November. He was absolutely right—I am not sure whether the right reverend Prelate would agree—that if you ask what is the purpose of government, it is difficult to see any other purpose for government than to create the conditions in which people can lead happy lives. How they find happiness is a subtle matter, but the Government create many of the conditions in which people lead their lives and surely that should be the basic guiding principle. I agree with Thomas Jefferson, who said that the care of human life and happiness is the first legitimate objective of government. I challenge anyone to come up with any other legitimate objective of government.
Perhaps I may comment first on the issue of measurement and then on the policy implications of the well-being objective and the Government’s performance in that respect. As the noble Baroness said, if you do the wrong thing, you search for your keys where the light is rather than where they really are. You only do the right thing if you measure the right thing.
It used to be supposed that it was impossible to measure the quality of life as people experience it in themselves, but in the past 30 years there has been an explosion of research on happiness which has shown that it is as measurable as any other internal state. We measure people’s political attitudes and do not think that is highly controversial; we measure whether they are unemployed, which depends on their state of mind in the way that it is measured in our official statistics; and how to measure depression used to be a subject of controversy but it no longer is. I am quite sure that in due course we will have a settled way of measuring well-being.
We currently have a number of ways and it is absolutely clear that although none of them is perfect—no measurement of anything is perfect—the measurements we already have provide valuable and meaningful information. For example, how people reply to questions about their happiness is closely related to the objective measurements you can make of electrical activity in the relevant parts of the brain, as well as being well related to the observations made by relatives, friends and observers; and the answers that people give to these questions are explicable in terms of many of the factors such as those mentioned by the noble Baroness.
This is not the place to discuss the exact questions the ONS is trialling—I declare an interest in that I have been involved in advising it about what questions to ask—but the Office for National Statistics, under its able chief statistician, has approached this issue in a most professional way. It has been testing many alternative approaches suggested by different people in addition to the four main questions it is already asking on a routine basis. By next summer they will have been answered, over a 12-month period, by 200,000 people
It will be an important moment when those results are published because it will give us, for the first time, an account of the state of the nation in terms of what I maintain matters most—how people actually experience and evaluate their lives. I am not sure whether it would be too grand to say that this will be a moment of comparable importance to the Domesday Book, or the first census, or certainly the great Rowntree surveys of wealth and poverty. It will show us, for the first time, who in our population is in misery and who is not. Many of the results will open our eyes, as did the Domesday Book, the census and the Rowntree surveys. It will be a very important moment in how we view our country.
It is also very important that the Government have insisted that the sample is big enough to provide valid and reliable results for each local authority area. One can imagine the debates in each council when they get their results and look at the distribution—where it is good, where it is bad and how it compares with other areas. It will be a wake-up call and I would be astonished if it does not lead spontaneously to a revision of the priorities of local government and of course—it is happening already to some extent—of central government.
Once you have got the measurements the next question is: why are things like this; what can be done about it? Of course, explaining the distribution of well-being—what are the causes of misery and happiness—should be, when we take into account the indirect causes as well as the direct causes, the main task of social science. We should think about the top priorities in social science.
We already know a great deal about what are the really important factors and the noble Baroness has already said much of it. I would say that, first, comes health—and mental health above all—and next comes human relationships, family, work, community, and money also matters to everyone. However, there are two important qualifications to that on which I would like to spend a little time.
First, in a country as rich as ours, relative income matters to people more than absolute income, and as our country becomes absolutely richer we cannot all become relatively richer compared to other people in our community; if some go up, others have to go down. This helps to explain why, as the noble Baroness said, there has been no increase in measured happiness despite the huge increases in absolute income experienced over the past 60 years.
It follows from this that although we need to deal with our immediate problem of unemployment and unused human resources, we need growth in the sense that we need short-run growth to get back to a state of full employment. We should not confuse that with long-run growth, which is much less important. We are going to have to revise our priorities away from the presumption before that almost anything could be sacrificed for the sake of greater long-term growth towards one where we put more priority on human relationships relative to long-run growth. We have put excessive priority on long-run growth and we have allowed it to erode our relationships in the family, work and so on. We have allowed the banks to argue that we need a highly risky economic structure on the grounds that it might produce more and higher long-term growth and we should not continue to accept those kinds of arguments. They are probably not even true in terms of long-term growth, and they are certainly wrong in terms of our values. Economic stability is far more important than long-term growth. The other caveat about money is that an additional pound increases the happiness of a poor person more than a rich person. Roughly speaking, the value of money to a person is inversely proportional to their income.
Finally, let me say a word about how the current actions of the Government stack up against the well-being objective. The Government face many constraints. They have made many important initiatives to promote well-being; in particular I would like to mention the one that the noble Baroness referred to: their commitment to complete the national rollout of improved access to psychological therapy. But if we look at the big picture, it is difficult to claim that the Government have prioritised well-being. Across income groups, the incidence of the overall cuts—including the expenditure cuts as well as the tax benefit changes—is affecting the poor more than the rich. This is inconsistent with what I said about the value of money to different parties. Across types of activity, the cuts are affecting our systems of human support for the young, the old and the unemployed more than they are affecting our capacity to produce long-term growth.
In fact, the Government have recently been hinting that they want to switch expenditure from current expenditure, which provides support for the social sector, towards higher infrastructure spending. As a founder member of the movement called Action for Happiness, I constantly hear stories about the devastating effect of this in terms of human well-being.
Lord Layard
I have tried to present a balanced scorecard. When the Government talk about the importance of well-being, I think it is totally sincere. It is a concern shared by all parties, but when it comes to the Government’s performance in delivering well-being, I am afraid that there is room for improvement.
Lord Wallace of Saltaire
My Lords, I very much welcome this debate. I share with the few who have spoken my enthusiasm for the topic and my view of its importance. I therefore much regret the very small number of people speaking from all Benches. I can remember five years ago or more, in my own party’s federal policy committee, being told that to have a working party on well-being and happiness was a woolly liberal topic that would arouse the scorn of the media. I read a book on happiness by one of my LSE colleagues at the time, which many thought was a woolly liberal book, written by an economist who only dared to do so because he was about to retire. The quality-of-life paper which my party debated at its last September conference was excellent. It drew on much more research than I had until then known was available. It was probably the first serious political party document that took this debate on board. I am very sorry that the Labour Party is so absent here, because it is absolutely the sort of topic that it ought to be taking on board. It is part of what our colleague, the noble Lord, Lord Glasman, is talking about when he talks about Blue Labour; the importance of community; the importance of social networks; and the importance of the non-economic factors, which old Labour ignored so dreadfully when it was knocking down the old housing communities and putting up those great and soulless estates.
The noble Baroness, Lady Tyler, says that this issue is starting to creep into the mainstream of public policy, and we must all accept that the word “creep” is important here. It has some way to go. It is also of course at the heart of the yet loosely defined concept of “big society” in the Conservative Party. I wish there were more Conservatives also taking part in this debate. There is a large cross-party, all-party debate to be had on this subject. It is still, sadly, only beginning.
I am answering this debate because, as the Cabinet Office spokesman in the Lords, I am responsible for the Office of Civil Society and answer for the Office for National Statistics—although I stress, it is an independent body to which I am answerable, but have no influence over. I think that is a very important part of this debate, because if we are talking about getting more reliable measures—measures that everyone in the debate will trust and be able to argue over—we need something like an independent Office for National Statistics to be able to hold the ground on that. I very much welcome the work that it is doing and the encouragement that the Prime Minister is giving to that.
The Stiglitz report, one of the key documents on this—after the book on happiness by the noble Lord, Lord Layard, some years before—says in its executive summary:
“What we measure affects what we do … Choices between promoting GDP and protecting the environment may be false choices, once environmental degradation is appropriately included in our measurement of economic performance … if our metrics of performance are flawed, so too may be the inferences that we draw”.
The problem, as we all know, once one gets involved in this debate, is finding objective measures of well-being and of having to depend partly on subjective measures of well-being. The ONS is experimenting with different forms of subjective work. The international dimension of this—the OECD has already been mentioned—in the work of the Canadians, Australians and others, helps to feed in to a more informed debate. Sadly so far, on the whole, it is limited to the experts, think tanks and social science faculties, but I hope it will spill out into a national debate. As I say that, I can immediately see myself, or perhaps the noble Lord, Lord Layard, in front of Jeremy Paxman as he sneers, “Surely you don’t believe that well-being has any relevance”, let alone imagine what the Daily Mail will say about this. It is going to take a lot of time to build respect for a very important shift in the national debate. It starts from recognition that GDP as a measure of social progress is limited. It does not distinguish between economic activity associated with positive and negative social progress, such as the cost of long commutes, crime, divorce, dealing with natural disasters and so forth. It does not include those important functions performed in the household and voluntary sectors. What we are looking for is a means of measuring social capital and social added value as well as economic capital and economic added value.
I note also in the literature, which I have read with great interest over the last few days, that there is the question of how one measures the quality of life as well as the quantity that one consumes. The Stiglitz report was extremely valuable as a way station in this. I very much welcome the way in which our Prime Minister has taken up the debate, started under the last Government and a number of international organisations, and has done his best to take it forward. I thoroughly enjoyed his excellent speech last November, in which he said,
“it’s high time we admitted that, taken on its own, GDP is an incomplete way of measuring a country’s progress … all of life can’t be measured on a balance sheet”.
And he recognises that,
“a new measure won’t give the full story of our nation’s wellbeing, or our happiness or contentment or the rest of it … but it could give us a general picture of whether life is improving, and that does have a really practical purpose … it will open up a national debate about what really matters”.
He continues that,
“information will help government work out, with evidence, the best ways of trying to help to improve people’s wellbeing”.
That is what the Government are engaged in. That is what the coalition parties are entirely signed up to. We very much hope that the noble Lord, Lord Layard, will in time persuade the Labour Party to sign up to it as well—perhaps, even, to understand the purpose of what is now under way.
As has already been mentioned, the ONS is designing the best measures that it can and is undertaking a large-scale survey, the results of which will be published next July. I hope that will take us on to the next stage in a widening public debate. This will look at a range of areas, including social interaction, relationships, family, community, volunteering, the whole concept of fairness—relative incomes have been mentioned—and a sense of having control over one’s own life. That is a very important set of questions. These are factors that can clearly be influenced and shaped by public policy. To make a slightly partisan point, my dislike for socialism was nurtured by being a candidate in Manchester and working on those huge rebuilt council estates. I fought a constituency in 1974 where 98 per cent of the population lived in council accommodation, mostly flats. I had some real argument with the city planners, who thought that they knew best what was needed for the people who lived in those houses. It was a concept of passive citizenship, in which people had things done for them but had no control over their own lives. That is part of what we have to reverse, and part of what Labour in particular has to reverse, in some of the old Labour thinking that is still there.
We are making progress. Some of these data do not entirely relate to what government can do, but there are very wide implications for public policy across the board. The much greater importance that we need to give to the whole question of mental health is part of this. I thought that the public health White Paper took us one small step in the right direction in that. We all know that depression is the opposite of well-being, and looking at well-being takes us into that whole area.
I myself am very much struck by the importance of the built environment. It is the opposite of the central Manchester council estates in Saltaire, which is a wonderful community. We are forced to live next to each other, because it is all terraced housing. We have green space—there is a park. There is an institute at the centre of the village, and we all as a result know each other and interact with each other. It has a real sense of social capital. Even from just spending the weekends there, I know many more people in Saltaire than I do in my neighbourhood in London. I hope that I do not sound too much like Prince Charles in wanting to build that sort of community, but there are some real questions about the lack of wisdom of building those new estates on the edge of towns with two car spaces outside every house where you absolutely do not interact with your neighbours. You do not have a local high street or a community pub, and as a result you grow up without interacting with your neighbours. So neighbourhood, community and a sense of self-control are all part of this.
That takes us on to the localism agenda, which the coalition agenda is developing. We still have quite a long way to go. Being in control of your own lives also means having more self-government; it means encouraging active citizenship. Many of us also think that it means more urban parish councils and more local, local government. That is something that we have to work on to reverse the alienation of so much of our population from our current style of politics, with the passive observance of Prime Minister’s Question Time as a form of distant entertainment that in no sense involves you.
So this has very large implications for consumer culture and the extent to which marketing and advertising encourage people to substitute buying things for actually thinking what they really want. There is the question of how far government policy should attempt to alter the way in which marketing and advertising go. There is the whole question of social trust and social capital. So we have a very long way to go.
I welcome the little remnant of us who have taken on this debate, all calling for a wider national debate, which shifts the national debate on to a new ground. It is a huge challenge to the conventional wisdom and a challenge to all political parties. It is also a challenge to the economics profession, which I hope the noble Lord, Lord Layard, continues to push. I hope for further debate in this Chamber as part of the wider debate, and I suggest to the noble Lord, Lord Layard, that he persuades Labour Peers to give the subject a full Thursday afternoon debate, or as full as possible, because this is a challenge to us all.
Welfare Reform Bill
(13 years ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Baroness Meacher
“(d) the fact that the claimant is a severely disabled person and no one is in receipt of a carers allowance or a carers premium for looking after them.”
Baroness Meacher
My Lords, Amendment 21A seeks to provide for an addition within universal credit that is similar to the severe disability premium. The addition would be paid to those living alone, although it would not be restricted to that group. It would not be paid to a claimant with a carer who receives either the carer’s allowance or the carer’s premium. The point of the amendment is to provide for severely disabled people who do not have a carer, and for those who have a carer but who cannot qualify for carer’s allowance because, for example, the carer is a student or a child. To achieve this result on a cost-neutral basis would require the level of benefit for the support group to fall slightly. The amendment, however, would ensure a fairer outcome than the Bill achieves.
The severe disability premium, which the Bill abolishes, aims to meet the extra costs experienced by disabled people living alone and is currently worth £53.65 per week for a single person. It helps people who are on a low income, whether in or out of work, who have a severe level of disability and who have no one living with them who can help them. It is well recognised that people in this position face much higher costs than other disabled people with a comparable disability.
I recognise that the Government plan to abolish the severe disability premium, but that plan is not designed to save money. The Government will instead transfer the money to fund an enhancement of the support group benefits. I understand, having just had a brief conversation with the Minister, that the increase will be something in the order of £44. However, the loss of the SDP will also apply to people who live alone and who move into the support group after these changes occur, so this very disadvantaged group will in fact lose out—although by something in the order of £8 a week, as I understand it. The support group people will lose the £53.65 per week, minus the uplift to support group benefits in the order of £44.
The reason why the transfer of funds from the severe disability premium to the support group might not be fair and efficient is that the costs of disability do not correlate well with the level of impairment, which is what will determine whether a person qualifies for the support group. The recent Demos/Scope report, Counting the Cost, based on a survey of 845 disabled people, found little correlation between the costs of disability for an individual and their level of impairment. It is quite difficult for someone such as me, who is not disabled, to understand quite how that works in practice but maybe others in the Chamber can illuminate that for us.
The relevant point here is that the severe disability premium targets help where it is most needed—on the additional costs that people have to pay because of their disability. Because this amendment will ensure that the SDP-equivalent benefit is payable only to those who receive either the middle or the highest rate of the care component of DLA, only those with frequent care needs throughout the day will qualify. It should be said that these care needs have to be for personal care rather than for the more mundane sort of activities such as shopping or housework.
The groups who would benefit from this amendment include those who become eligible for the support group after the introduction of universal credit but who live on their own and do not have a carer. These groups will include new cancer sufferers, for example, and those with a new and severe impairment. Without this amendment that group will lose the £53.65, as I have said, although they will recoup a fair proportion of that through the higher support group payment. Another group that would benefit from the amendment are those who are entitled to the middle rate of the care component of DLA but who are in the work-related group, or perhaps even found fit for work.
Going to work costs money, of course, particularly for disabled people who might not be able to use public transport alone, for example. Under the current system, a severely visually impaired person living on their own and earning £100 a week will have a disposable income of £188 per week, after housing costs have been paid, plus their disability allowance. Under universal credit the same person will, as I understand it, be little better off than someone without an impairment. That must apply to those who do not actually make the support group assessment. If you are assessed as not having a sufficient impairment to justify the support group benefit, obviously you are in a very different situation.
Young carers will also benefit. Severe disability premium has played an essential role in supporting young carers. If a lone parent is severely disabled and their child acts as a carer, the child cannot claim carer’s allowance but the family can benefit from the extra financial help offered by the SDP payment. As I suggested at the beginning, this amendment is not designed to increase costs but rather to ensure that the money is not transferred from very needy groups to others whose impairments might be more severe but whose financial needs might be less. The issue is that these are different assessments, and come out with different results.
The Government strongly support the careful targeting of precious taxpayers’ money. This amendment seeks to support the Government’s objective, and to improve the fulfilment of that objective more effectively than the Bill currently does. I should say that this is a probing amendment, but I hope the Minister will understand the problem that I am raising and will consider a way forward. I beg to move.
Baroness Grey-Thompson
My Lords, I rise to support the amendment of the noble Baroness, Lady Meacher, and to look specifically at the removal of the severe disability premium and the effect that it will have on young carers who are looking after a lone parent who is disabled or two parents who are both disabled.
The severe disability premium is really important in supporting young carers. Children who are still in full-time education cannot claim carer’s allowance, but many play an invaluable role in supporting disabled parents. However, if there is no other adult in the household, and no one claiming carer’s allowance, the family can benefit from the extra financial help offered by the SDP.
The abolition of the SDP will cost families with a young carer up to £55.30 per week, which is £2,876 per year. This cost could be equivalent to 20 per cent of household income after housing costs. The Department for Work and Pensions estimates that around 25,000 lone parents are in receipt of severe disability premium. That is 25,000 families with a disabled adult, in receipt of the mid or high-rate care component of DLA, but with no adult either in the household or receiving carer’s allowance to look after them, and with children in the household.
Many of these children are likely to be doing a substantial amount of caring for the parent, but this measure could force them to have to take on additional caring and household responsibilities because the family just cannot afford to pay for help. This is likely to put additional pressures on their children to make up for this loss of additional care. This is happening at a time when support services for young carers are being cut back, according to a recent survey by Action for Children. The charity surveyed 23 of its young carer projects between May and June this year. Findings reveal that almost half of services questioned reported a rise in the number of children on waiting lists and had seen an increase in the needs of young carers.
The Children’s Society, which works with young carers, gave the following example of the pressure that some of these children face and why they should not be pushed into even tighter financial circumstances. Kelly’s mum, Jenny, became ill about 10 years ago when she was only eight years old. An aggressive illness hospitalised Jenny, and has since entirely paralysed her down one side. After staying with relatives for several months while her mum was in hospital, Kelly was able to move back in to live with her mum from the age of nine. Since then she has cared for her mum non-stop. She makes meals and does the washing and cleaning. She said early on that she could only make simple dinners such as scrambled eggs on toast, but she has learnt quickly, and she has had to. She does not do it alone; she has a rota of professional carers who come to help out day to day, but they cannot do everything, and they do not stay overnight.
About three years ago, the year before Kelly was due to sit her GCSEs, Jenny became extremely ill for a while. Kelly had to get up around four times a night to help her out. Naturally, she was exhausted, dragging herself to bed as soon as she got in from school. Jenny currently receives the severe disability premium, meaning that she and Kelly are just one of 25,000 families with a disabled single parent. They will presumably be covered by transitional protection, unless Jenny’s reassessment for ESA from IB is viewed as a change of circumstances. It would be useful if the Minister would be able to clarify that. However, families who find themselves in a similar position after the measure is brought in are likely to be left £55 a week worse off as a result of losing this premium.
Lord McKenzie of Luton
My Lords, we should be grateful to the noble Baronesses, Lady Meacher and Lady Grey-Thompson, for introducing this important issue on which we have all received representations. Quite a lot of numbers have been bandied around with particular reference to benefits, and I will be interested in the Minister’s response. As I understand it, in the current system the severe disability premium is paid to people, whether in or out of work, who receive at least middle-rate care, live on their own and do not have a carer. It is payable only as a means-tested benefit so it supports those with a severe disability who have a low income and face many extra costs as a result of living alone.
Alongside that is the disability element of the working tax credit, so under the present system someone who is entitled to DLA or has recently been receiving a long-term sickness benefit would be entitled to the disability element of working tax credit if they worked for at least 16 hours a week. That is where we start from. As we have heard, though, the proposed support for adults in the universal credit depends upon the gateway of the WCA. This is what will drive the new arrangements. The briefing that we have had says that only those with a level of impairment sufficient to be found not fit for work will receive any extra help. I am not totally clear whether in that context “not fit for work” means someone who would only be going to the support group or someone who was going to the WRAG as well. I think the Minister is shaking his head, or rather he is nodding to say that only those in the support group would receive that.
That creates the difficulties that have been spoken about. The changes would mean that someone who could self-propel a wheelchair 50 metres or was registered blind but could undertake a journey unaccompanied could be found fit for work or, presumably, for work-related activity. Of course no one would want to claim that such individuals could not be encouraged to work if they wanted to, but that does not mean that they do not face considerable disadvantage and cost compared with someone with no impairment. So if they are out of work but found fit for work they face the same conditionality as everyone else, but if they are in work, because the gateway for extra support within the universal credit is the WCA, someone who is found fit for work will receive no extra support in work. The juxtaposition of the present and the future is concerning.
I am sure that the Minister will have seen the briefing that we have had. It says that the following are some of the ways in which different groups will be affected. Those who are terminally ill or who develop a severe level of impairment and live on their own could be disadvantaged to a significant degree—by something like £50 a week. Someone who is entitled to a middle rate of the care component but found fit for work—for example, someone who is severely visually impaired—will in many cases be found fit for work. However, if they are living on their own and doing some work, they are likely to have considerable extra costs that are not met by the DLA or by PIP when it comes along. Currently, most would be entitled to at least the middle rate of the DLA care component and therefore the SDP.
Under the current system, a severely visually impaired person in the work-related activity group and living on their own earning £100 a week will be left with a disposable income of £188 a week plus their DLA, after housing costs are paid. Under the universal credit, the same person will be left with a disposable income of less than £100 a week plus whatever PIP is payable after housing costs. There are plenty of other examples and we have heard some of them today from the noble Baronesses. These sorts of disparities are quite disturbing. The Minister might say that these are quite specific and narrow examples of the full spectrum of people who are affected by this, but a serious issue has been raised here and we need to understand fully how people are being protected in comparison with the current system under the new world of the universal credit.
Lord Freud
My Lords, this amendment seeks to put an additional element into the amount of universal credit that is payable for those who are severely disabled and who have no one receiving either carer’s allowance or a carer’s premium for looking after them. In essence it seeks to recreate the current severe disability premium within universal credit. As such it would involve a significant increase in cost compared with the Government’s plans. That increase stands at £400 million, unless there were other readjustments. However, let us just take it at face value. At face value, it is unaffordable.
On Monday the House approved the Government’s plans to simplify the disability-related additions. Instead of the seven different components within the current system of benefits and tax credits for adults, and two further rates in child tax credits for disabled children, universal credit will just have two rates for both adults and children. By restructuring the rates in this way, we are not looking to make any savings. We are redistributing around £800 million of current spend without returning any savings at all to the Exchequer. The full amount will be reinvested by increasing the higher rate for more severely disabled people. In our policy briefing note we made it clear that there would be some phasing. I know that I owe the noble Lord, Lord McKenzie, a letter on that matter.
Once resources became fully available, we expected to be able to provide a higher rate, at around £77 a week. This is significantly higher than the current £32.35 payable as the support component within ESA: £44.65, to give the noble Baroness, Lady Meacher, the exact figure she was seeking. It will provide a much more meaningful amount to severely disabled people than the current patchwork of premiums, which gives some people more than others and makes it difficult for people to understand and obtain their full entitlement. I should make it clear that one of the features of the universal credit as a whole is that we are expecting a substantial amount of the gains to the poorer people to come from much better take-up. The simplicity of a system with automatic provision of everything that people are entitled to will mean that more people in this category are likely to be recipients and get what they deserve.
Baroness Meacher
It would be helpful if the Minister could explain whether there is any provision in the new system for child carers, where the mother might not be in the support group. You have to be very disabled, as I understand it, to be in the support group. Yet a mother might need her child to do an awful lot in the home: shopping and cooking and all the rest of it. Is there any provision for her?
Lord Freud
My Lords, I will come to that. What we are dealing with here is rather interesting, as we move from one system to the universal credit. We are dealing with the current system as it exists on paper, we are dealing with where we want to go in the universal credit, and then we are dealing with something in the middle, which is how things actually work on the ground. This is one of the areas in which things are working on the ground as they are not really meant to. It is simply not the role of the severe disability premium to provide money for young carers. Clearly young carers could be affected if they are providing support for a disabled parent who receives the severe disability premium. Under the current system, the youngster gets it because there is no adult in the house looking after them and they are not allowed to receive the carer’s premium. It is one of those things that has unintentionally fallen through the cracks. It was simply not intended as a support for young carers; it was designed to support severely disabled people who live alone.
Baroness Meacher
I thank the Minister very much for his response. Certainly, the idea was that this amendment should be cost-neutral and a redistribution between the support group benefits and this benefit. There will obviously be significant losers in this; child carers will certainly be among them. I do not envisage local authorities picking up the tab in the years ahead. There are very real concerns but, at this time of night, I must accept the Minister’s response and withdraw the amendment.
Baroness Turner of Camden
Baroness Turner of Camden
My Lords, this is a very short amendment which I came to as I leafed through the Bill before writing any amendments down. It is an attempt to amend and make clear what is meant by work-focused interview requirement. The Bill states:
“The Secretary of State may specify how, when and where a work-focused interview is to take place”.
We must bear in mind that we may be dealing with a number of people who are not terribly well or who are not very well clued up about what arrangements are necessary. There would, presumably, be some sort of sanction if the claimant did not turn up. I have therefore drafted an amendment which enables a claimant who cannot comply with the requirement to attend a work-focused interview to provide medical evidence to say that, on that occasion, they are not able to turn up. In that way, they would avoid any sort of sanction which might exist. I hope that this, or something like it, will be acceptable to the Minister. As we are dealing with people who are often not very well, I am trying to make it clear that there is no sanction if they simply cannot make it.
Baroness Drake
My Lords, I have Amendments 23A and 24A in this group. Amendment 23A requires the Government to have regard to the interests of the child when operating work conditionality and work availability requirements under universal credit. Work availability applies not only to those seeking work but can set requirements on those in work to increase their hours of work or to seek higher paid work. This conditionality has acquired greater significance because the Government will expect people with children aged five and upwards to be subject to full work requirements and are extending full work requirements to couples with children.
I do not seek to make a speech about what the needs of the child are and I do not seek to debate the detail of how work availability requirements will operate, though I have my opinions. What I do seek is to place a requirement on the Government to implement and operate work availability requirements with reference to the interests of the child of any carer subject to work conditionality. Universal credit imports a novel and extensive level of discretion over a sizeable section of the working-age population and powers to follow through with sanctions. However, a policy that is premised on the belief that parents and their attitude to benefit or responsibility are better if they work has to be balanced by the need to protect the interests of the child of the carer, subject to such conditionality.
It is not a question of whether we do or do not accept the Minister’s assurances; I am sure he gives them in good faith. But those assurances are not of themselves sufficient. If the Government want to take, for the Secretary of State, a powerful range of discretions necessary to apply work conditionality, which even the Minister admits is not fully defined or refined operationally, then Parliament should require the Secretary of State to exercise those discretions with reference to the needs of the child whose care will be impacted by the application of that discretion.
In response to concerns on this matter expressed in Committee, the Minister said:
“Jobcentre Plus does not dictate to parents the type of childcare or which provider they should use”.
He added:
“Advisers will continue to have an important role in both challenging and supporting parents who may have preconceived ideas about childcare”.
Furthermore, he said:
“Where the adviser considers that the parent has not taken reasonable steps to identify or access appropriate childcare they will refer the question to a decision-maker. The sanction will only be imposed if the claimant does not have a good reason”.—[Official Report, 26/10/11; col. GC 326-327.]
He had earlier said that,
“in due course we will provide more detailed guidance on how the system will operate in practice”.—[Official Report, 26/10/11; col. GC 296.]
That is a lot of guidance, a lot of discretion and a lot of work still to do, even though some reassurances are given. Currently, there is also a lack of clarity as to what would or would not be a good reason for a carer not to have access to childcare.
The amendment does not seek to answer those questions but seeks to insert in the Bill a requirement that the work availability requirements have to operate by reference to the interests of the child or any carer subject to them. Amendment 24A seeks to exempt family and friends, and kinship carers, from the conditionality requirements to seek work for a period of 12 months when they take on a child or children who cannot live with their parents because of parental death, drug or alcohol abuse, serious illness or imprisonment—most of whom would otherwise end up in local authority care. These carers are doing an enormous service, both to the vulnerable children and the state. Such carers often step in in extremely difficult circumstances, often at short notice, and voluntarily embrace responsibility to protect the child. Such children are covered by an order under one of the various provisions laid out in this amendment.
It is important to remind ourselves that we are talking of a population of some 200,000-plus highly vulnerable children who are being raised by grandparents, older siblings, other family members or friends. If just 5 per cent of the children currently in family or friends’ care were in independent foster care, this could add £500 million a year to the cost of providing for children in care. A number of provisions in the Bill could unintentionally disadvantage family and friends carers, and one certainly wants to avoid the risk of children needlessly being taken into care. These include not only the conditionality requirements I am referring to but other matters such as the benefit cap, to which I hope to return.
However, it is important to recognise that three in 10 family and friend carers give up work when a child moves in, and a similar number reduce their hours, often because they are told to do so by a social worker because of a trauma that the child has experienced that has led to them being taken into the family and kinship care. Many of the social workers feel that the carers have to do this in order to meet the child’s needs. Someone who adopts a child is entitled to adoption leave, but family and friends carers have no such entitlement to help them to settle a child—during what is often a very difficult period when they first arrive—and cope with the upheavals in their lives. They often have to take on these children without notice and often to avoid the children being taken into care.
In Committee, an amendment was tabled to give working-age family and friend carers exemption from conditionality requirements for one year after a child moves in. I recognise that I may not have the influencing powers of my noble friend Lady Hollis of Heigham, but it is very much welcome that in Committee the Minister made a very intelligent observation when he recognised the enormous contribution that family and friends carers make to society and children, and that it makes good sense to support them. I quote the noble Lord, who said:
“I am absolutely convinced that this is a key area and am currently looking closely at ensuring that this group is treated appropriately under the universal credit … However, we recognise that clarity of treatment and a clear legislative exemption could be of value”.—[Official Report, 26/10/11; col. 338.]
The Minister concluded:
“I am on the case”.—[Official Report, 26/10/11; col. 341.]
I am delighted by that. I hope that he is still on the case. I urge him to translate his warm words into action by supporting the amendment.
If the Minister is unwilling to accept the amendment, will he instead be willing to commit to introducing protection for kinship carers through regulations? I specifically ask him commit to include in regulations that there should be an exemption for conditionality requirements for family and friends carers for one year after taking on the care of a child who is not their own; and that family and friends carers who are required by the local authority to give up work or reduce their hours to look after such a child or children will be entitled to have their jobseeking requirements switched off or constrained for the duration of that requirement.
Lord McKenzie of Luton
My Lords, I speak initially to Amendment 26. The amendment takes us into the as-yet uncharted waters of in-work conditionality—waters into which my noble friend Lady Drake has at least dipped her toe.
The Bill introduces for the first time the requirement on claimants who already have a job to take action to secure more paid or better paid work. We understand the need, within a system that has no clear distinction between in-work and out-of-work benefits, to have some mechanism to ensure that people do not simply reduce their hours of work to take advantage of the more generous support for lower-hours jobs that universal credit provides, but there are a host of unanswered questions about how in-work conditionality will work. The amendment is intended to ensure that Parliament has an opportunity to review the arrangements once they have come into force.
We debated these questions at some length in Committee, and the Minister's response was basically, “We are thinking about this”, with some indication that he would not be in a huge hurry to introduce this element of the Bill. The most fundamental of those questions is: what exactly is taken to be work in the context of universal credit? When will the state judge that someone is doing enough to be free of the requirement to report on their activity to the jobcentre? Although we have some indication that single people with no caring responsibility or health issues will be expected to work for 35 hours a week, and couples in the same situation for 70 hours, we have no idea what flexibility will be given to those whose circumstances mean that that is not reasonable.
For example, what will happen if one partner of a couple decides to reduce their hours—perhaps to look after children? The way that the incentives are structured within universal credit may encourage many second earners to do just that. Will they then face a jobcentre penalty for not engaging in sufficient work?
It is also unclear exactly how the in-work conditionality provisions will impact on the employment relationship. How will it impact on the likelihood of employers offering somebody a part-time job if they know that the jobcentre will be encouraging them to leave their job for one with longer hours? We know that, despite today's employment figures, some unemployment was avoided at the start of the recession due to employers reducing people's working hours rather than making redundancies. Would they have been penalised for reducing hours in that way under the Bill? The in-work conditionality proposals will bring many more people into the orbit of Jobcentre Plus at a time when the agency is being asked to make challenging efficiency savings. Can the Minister outline what estimate he has made of the additional resource that will be needed to deliver conditionality for in-work claimants and whether he expects to be able to secure that?
In Committee we discussed the position of the work programme providers under these provisions. The Minister assured us that the fact that work programme providers must get somebody into work for 16 hours and keep them there for two years was not in conflict with the aim of this part of the Bill to ensure that somebody leaves a 16-hour job and goes into one that either pays more or has more hours of work each week. A review of this provision after a year will enable us to see whether the Minister’s confidence is justified.
Finally, we have had no equality impact assessment on this proposal. A review would enable us to assess its impact on different groups. As the proposal intends to assess whether somebody is fulfilling their in-work conditionality requirements by looking at how much they are earning rather than how many hours they are working, for those who earn more these requirements will obviously be easier to meet. I hardly need remind noble Lords of the substantial pay penalties faced by women, by people with disabilities and by certain ethnic groups. We will need to look carefully at whether people within these groups are significantly disadvantaged by these proposals.
This amendment in effect accepts the assurances that the Minister gave us in Committee that these matters are under consideration and simply asks him to report back to Parliament on how the proposals are operating in practice. I am sure that he will want to accept it, if only in order to be able to demonstrate that, as we all hope, this policy is achieving its intended aim of supporting people to move on in work.
I move on briefly to the contributions of my two colleagues. As well as talking about the very important issue of the focus on children being the driver of these provisions, the noble Baroness, Lady Drake, referred again to kinship carers. The amendment that she spoke to seeks to add kinship carers, carefully defined, and limited to the first year in which they are caring for a child, to the existing list of exemptions. When we debated this issue in Committee, my noble friend Lady Hayter said that she was able to rip up her speech given the willingness of the Minister to recognise this issue, suggesting that he was looking to address it. My noble friend, who has provided me with the text this evening, says that she is perfectly happy to rip up another one if the Minister can let us know the results of his deliberations and what these have been.
I will not repeat the powerful case made by my noble friend Lady Drake. As she emphasised, kinship carers can play a vitally important role, offering children in extremely vulnerable situations some family continuity and, in doing so, saving the state the considerable costs of taking a child into care—some £40,000 a year in independent foster care. The Who Cares? Trust has highlighted the difficult experiences of many children cared for by their parents, estimating that one-quarter will have lived with abuse, neglect and violence and one in four will have been deserted by their parents, often after drug and alcohol abuse. Sixteen per cent go to their grandparents after family breakdown, one in 10 after a parent’s illness—often mental illness—and one in 10 after the death of a parent.
Although the existing conditionality arrangements provide some protection to those caring for young children, with no conditionality until the child is one, and then work-focused interviews until the child is five, many of the children who move to live with kinship carers will be older than five, as older children—indeed, those over 12 years old—make up a higher proportion of those in kinship care than in the wider population. Despite not being babies, for obvious reasons they need pretty much full-time attention and care. They will be new family members when they arrive, yet, not being adopted, will have no equivalent recognition. They also usually arrive after some sort of trauma and are therefore likely to take time to settle down. The amendment my noble friend spoke to simply seeks to provide for those who take on the care of a related child a year in which they will not be asked to look for work. This will give those considering taking on this huge task some certainty about their income and security during this first year and a chance to focus on their care for the child. A year’s exemption from looking for work would give them time to manage the upheaval in their lives before starting to juggle work and care.
Our concern, expressed by my noble friend, is that, without this amendment, the Bill risks undermining families’ capacity to care for children and increases the likelihood of those arrangements breaking down. Unlike with formal adoption, there is no adjustment period for family carers, despite the needs of the children. Furthermore, carers often have to give up work as a condition of a placement. We are aware that, as my noble friend said, the Minister is sympathetic to this case and we look forward to hearing his response.
Finally, I should like to refer briefly to the contribution of my noble friend Lady Turner of Camden in relation to Amendment 23. As she explained, this amendment seeks to ensure that evidence from a health professional will be accepted as good reason for failing to attend a work-focused interview—a requirement that will, under the Bill, be placed primarily on lone parents with children aged between one and three. We hope that this will be a simple amendment to accept, as my noble friend has explained. In Committee, the Minister told us:
“We will not sanction claimants with limited capability for work, or those who have learning difficulties or mental health conditions, without first making every effort to contact them, their carer or healthcare professional to ensure that they have fully understood the requirement placed on them and had no good reason for failing to meet it”.—[Official Report, 1/11/11; col. GC 417.]
We hope that the Minister will be able to extend this to include those who provide their adviser with evidence that they have a health-related reason for failing to comply with the work-related requirement.
This amendment also enables us briefly to revisit the question that arose in Committee about the relationship between Jobcentre Plus advisers, Atos assessors and the healthcare professionals who deal with a claimant. It also enables us to ask the Minister again to clarify exactly what information is available to Jobcentre Plus and work programme advisers, who have to decide on the type of requirements to which the claimant should be subject. Will they have access to information about a claimant’s health and capability for work that has been uncovered during the assessment phase for employment and support allowance?
We want this whole scheme to work to help those who can be helped but not to waste advisers’ time, nor to bring the system into disrepute by demanding inappropriate behaviours of claimants where evidence of their health needs exists within the system. Therefore, we hope that the Government will feel able to accept my noble friend’s amendment.
Lord Freud
My Lords, this group of amendments contains a number of measures that align with our intentions, so we are apparently in agreement. Indeed, many are in line with current practice and we intend to carry them forward into universal credit. I shall take each of them in turn.
With regard to Amendment 23, we recognise that there may be medical reasons that prevent a claimant attending a work-focused interview. We do not need expressly to legislate for this to be recognised. If a claimant gives advance notice that he will be unable to make an appointment and has good reason for this, the interview can be rearranged. If a claimant fails to attend an interview, he will have a reasonable period of time to explain why. As part of that explanation, the claimant will be able to provide any relevant information, including any medical evidence. If the claimant has a good reason, then obviously no sanction will be imposed. This is essentially what happens already and it will continue.
I turn to Amendment 23A in the name of the noble Baroness, Lady Drake. I appreciate the sentiment behind the amendment and agree that it is important to balance the requirements placed on claimants with any childcare responsibilities they may have. Therefore, legislation will provide clear safeguards, ensuring that no claimant who is responsible for a child under five can be made to look for or take a job, and no claimant with a child under 13 will be required to look for a job that does not fit with their child’s school hours, including a reasonable allowance for travel time.
Advisers will have flexibility to tailor the requirements placed on claimants—including allowing limitations to the work that claimants must search and be available for—to take account of their circumstances and the needs of any children for whom they are responsible. Where the child is over 13, advisers will continue to have discretion to permit the claimant to limit their availability if the child’s needs make it necessary. We do not intend to make blanket rules for this age group in legislation, as the children’s maturity and need for parental supervision will vary widely. Therefore, although we agree with the spirit behind the amendment, we do not think it necessary.
On Amendment 25, we are now making provisions in the jobseeker’s allowance on domestic violence. The regulations giving effect to this policy will be subject to affirmative debate early next year as parliamentary time allows. The changes will take effect soon afterwards. The draft jobseeker’s regulations will provide that where a claimant has left the abuser because of violence or the threat of domestic violence, they will be treated as complying. This will be automatic whenever the claimant provides evidence of violence or the threat of violence and may be extended through existing domestic emergency provisions to up to 17 weeks, or to 24 weeks for claimants with childcare responsibilities. The amendment would allow an exemption from work-related requirements only while the threat continues. Our proposal recognises that claimants may need unconditional support for a period after the actual threat has receded.
Baroness Lister of Burtersett
We are very pleased to hear that. Can the noble Lord tell us what definition of domestic violence the Government have in mind? They are consulting at present on the question of domestic violence and I wonder what the implications are for this provision.
Lord Freud
I am going to have to write with a precise definition of domestic violence and the threat of domestic violence.
Turning to Amendment 26, we are all too well aware that in-work conditionality is a difficult and contentious area. In this debate and in Committee noble Lords raised a number of concerns and questions. I think that I have been open enough to admit that I do not have all of the answers to those questions right now, but I hope that I can provide some real reassurance by describing our planned approach. We are going to take some time to get this right, because it is a new area. I said in Committee that there may be a role for piloting and I can now be much clearer on that.
We have decided that when universal credit is launched we will not be imposing conditionality on claimants with income or earnings which would, broadly speaking, have taken them over the cut-off point for the current out-of-work benefits. So we are effectively continuing with the current system. Rather than a review, our approach will be to pilot the application of conditionality on claimants whose income is above this level. We will want to gather views on the sort of approaches that could be tested and I commit to publishing the details of these pilots. We will then reflect on the results of that process before adopting any national approach.
Finally, turning to Amendment 24A, I have listened very carefully to the feelings of noble Lords on this and again let me say that we are of one mind on this matter. Work is already under way, as I said in Committee, around how kinship carers should be treated for conditionality purposes. I agree that kinship carers who need a period of adjustment should be given time to return to a stable footing before being expected to meet work-related requirements and juggle conditionality with new caring responsibilities. Advisers will have discretion to lift temporarily the requirements on individual claimants where a child’s needs are such that the claimant must be able to provide full-time care. I repeat what I said in Committee. I recognise the potential for value and clarity in a legislative exemption from conditionality and we are carefully considering options for further provisions. The Bill provides scope for flexibility in this area and we have powers to make regulations as necessary. These things take time, but I can assure noble Lords that work is progressing. I am on this case. We are currently talking to the Department for Education—
Baroness Drake
I shall not miss any opportunity on this because I know that this important community will hang on the Minister’s every word—and I say that in the warmest sense. The Minister said that advisers would have the discretion to lift the conditionality and, at the same time, he repeated the reference to the value and clarity of legislation. If I may push him, is he saying that guidance and discretion around guidance are not of themselves sufficient to address this community?
Lord Freud
I think what I am saying is that you can take away the discretionary elements of support for this community, and that is already in the bag. I would like to add more to that, and that is what I mean when I say that there is value in legislative exemption. Then I move on to say that I am working on it. I am seeing some noble Lords who are familiar with government having a good giggle because they know exactly what is happening and they giggle with reality.
The way I have to express this—again, some noble Lords will recognise this better than others—is that doing more for this group may come at a cost, and we are operating in difficult financial times. I repeat that I have a real interest in this area, and when I am able to give firm answers, I will do so. This is a matter with which we will deal in regulations rather than in primary legislation. On that basis I urge the noble Baroness not to press her amendment.
Baroness Turner of Camden
My Lords, I thank the Minister for his response to my amendment on the requirement to attend work-focused interviews and for his promises. As for domestic violence, I did not get around to speaking to my amendment mainly because it was grouped with a number of other amendments and was not called. However, I am very obliged to the Minister for what he said about domestic violence. I beg leave to withdraw the amendment.
“(e) the claimant is receiving specified treatment for cancer, is recovering from that treatment or is likely to receive such treatment within 6 months”
Baroness Morgan of Drefelin
I shall speak also to Amendment 47. First, I want to declare an interest as chief executive of Breast Cancer Campaign. I am grateful to have the opportunity to speak to these amendments that aim to ensure that cancer patients awaiting, receiving or recovering from chemotherapy or radiotherapy will automatically qualify for the employment and support allowance support group without having to undergo an assessment. I have to admit to being disappointed that we have had to come to the point where it is necessary even to lay these amendments now. This is a debate that we should have had in Committee, but we were unable to do so because at the time the outcome of the Harrington review and the Government’s response to it were not known. That is why we are having what is probably a Committee stage debate now—although obviously within the correct procedure for Report.
While I am sure the Minister will be able to highlight technical flaws in the wording of the amendments, I hope that the discussion today on these amendments will focus on the intention behind them, which I believe is clear. I am sure that if there are technical flaws that need to be addressed, they can be looked at for Third Reading.
Over several months, we have heard a number of seemingly very reassuring statements from the Government in relation to employment and support allowance and supporting people with cancer. I note, for example, the response by Chris Grayling MP, the Minister for Employment, on 18 October to a Written Question, in which he said:
“Ministers have had a number of discussions with Macmillan Cancer Support since the spending review announcement, as we are determined that the benefits system should support people who are diagnosed with cancer in the most sensitive, fair and appropriate way. The Department has no interest in making it harder for those who cannot work to claim benefits and is committed to an ongoing process of review and improvement”.—[Official Report, Commons, 18/10/11; col. 930W.]
That was a very reassuring statement.
Unfortunately, the recent publication of the Harrington review and the Government’s response to it resulted in anxiety across the cancer community. I have listened to the views expressed by organisations such as Macmillan Cancer Support and others and am sorry to say that I am not reassured by the news that the Government are considering withdrawing automatic qualification for the support group of ESA to those on non-oral chemotherapy—commonly referred to as IV chemotherapy—instead of extending the exemption to cancer patients receiving oral chemotherapy. In effect, that is going in exactly the opposite direction of that pointed to by the Minister for Employment.
We know that Macmillan Cancer Support undertook an expert consultation on this matter for the Harrington review. It did an enormous amount of work and I pay tribute to it for it. There is no doubt that the recommendations produced by it through consultation with an expert group of clinicians have not been adopted. Macmillan has been very clear on this point. I have had a look at the government response and it seems that Macmillan is making a fair point.
The Minister will no doubt suggest, as he has done previously, that the Government’s response is not contrary to Macmillan’s conclusions. However, it is my understanding that while the clinicians consulted provided the charity with a range of views—Macmillan has been totally transparent about all the views that it has received—a clear consensus was reached by experts that certain groups of cancer patients undergoing treatment should qualify for the support group automatically. As was stated by the charity, this is because those patients are more likely than not to be debilitated by their treatment and should not be made to go through an assessment while undergoing this debilitating treatment.
While I am not suggesting that it was the intention of the Minister and his colleagues to add to the struggles and difficulties that cancer patients experience, I fear that what is currently being proposed would do just that. In the Sunday Times this week, the journalist Jenni Russell shared her experiences of chemotherapy very movingly and said:
“I read these proposals with incredulity. I have been seriously ill at times in my life … but I have never felt as appalling as I did on chemo … I had assumed I would overcome it with a bit of willpower. Instead I had vomiting, nausea, headaches, muscle weakness and an inability to tolerate bright lights. For the first four days in every fortnight’s treatment, I couldn’t eat, speak, read, listen to the radio or get out of bed. My white blood cell count sank so low that I needed injections to boost my bone marrow production. For the next six days I was too weak to want to walk upstairs. There was no fight left in my body; every cell was being affected and it seemed every cell was losing the will to live. Then for three days I would feel almost normal until the cycle began again”.
Jenni Russell then provided her view on how cancer patients might interpret what was being proposed by the Government in this Welfare Reform Bill. She said:
“What people in treatment are hearing is that they will be assumed to be guilty of skiving unless they can prove otherwise. Nothing could be more demoralising to the individuals who are already having to cope with being cut open, poisoned or burnt in the hope of saving their lives”.
These are very hard-hitting comments in the Sunday Times and very difficult to read. While there are hundreds of thousands of other people who do not have the opportunity to share their experiences in the House today, I feel sure that the views expressed by Jenni would be endorsed by many cancer patients around the country.
I noted the Minister’s comments on Monday—I was disappointed that I was not here for the Question—that part of the rationale for not allowing automatic qualification for benefit is that it is important for many cancer patients to stay in work. I do not disagree with that at all. However, it seems far fetched to suggest that qualifying for the support component would stop cancer patients who wish to continue working for as long as they can from doing so. I do not understand how that holds up.
The Minister may also argue that the automatic support group status encourages the wrong kind of behaviour in cancer patients. The Minister shakes his head; I am sure he will put me right in a moment in his very clear way. I would welcome hearing from him whether he really believes that cancer patients would decide to leave work just because they are automatically eligible for this benefit. What picture does that paint of the motivations behind cancer patients’ behaviour? It is my understanding that automatic entitlement to ESA support group status would not prevent patients who wish to remain in work for as long as they are able from continuing to do so. If the Minister has any evidence that the existing exemption for cancer patients on IV chemotherapy, for example, has been or is being abused by cancer patients who are clearly capable of working, it would be very useful to hear about it. The House would welcome that.
Nor will becoming eligible for the support component of the ESA while receiving chemotherapy lead to people spending a lifetime on benefits. I know the Government are very concerned about ensuring that we do not leave people to languish on benefits for a lifetime. I totally support that. We know that work is good for people. Even if that is what people wanted—which they do not—they are reassessed for eligibility for benefit after their treatment. This would mean that when they are no longer in need of the support on offer from the support group, it would be withdrawn. There were many personal examples given in Committee. When I was talking about PIP, I used the example of my niece who was in the process of being treated for Hodgkin’s lymphoma. She is in hospital having her second transplant at the moment. Throughout her 18 months of treatment she has been reassessed three times for ESA to check whether or not she should still be receiving it in the support group. So there is no danger of her going on indefinitely in the support group.
The amendments will ensure that the added burdens associated with seeking financial support during the most difficult of times are minimised as much as possible. This would help to remove the anxiety experienced when people have to wait for the results of a decision-maker. With 40 per cent of appeals currently successful, we should not forget that these decision-makers are clearly frequently making the wrong decisions. It is feasible that, without the guarantee of receiving the support component of the benefit, cancer patients who are in the middle of treatment could be forced to attend back-to-work interviews or even be found fit for work.
I remain hopeful that the Minister will respond to the growing concern on this issue, which has been even more apparent over the past week. I hope he will be able to say that all patients receiving, due to receive or recovering from chemotherapy will automatically qualify for the support element of ESA. It would also be useful if the Minister could explain at this stage what further documentation and processes cancer patients receiving IV chemotherapy will have to provide and undergo in future as this would be extremely helpful in informing the debate at this point.
I hope very much that the Minister can give me reassurances that it will not become more difficult for those who are currently automatically put into the support group because of their cancer treatment to claim ESA. I hope very much that the Minister will be able to give undertakings about the consultation process, which I believe is due to be taken forward just before Christmas—Christmas holiday time—and that the consultation period will seek the views of many on a range of options. It looks a little like the Harrington review has asked Macmillan to do some work for it, does not like what has come back, and is going to ask some different people to see whether it can find some more opinions that it does like. I am sure—absolutely sure—that this is not what the Minister is proposing at all.
I hope that if there is to be a consultation over Christmas it will be done in a fair, open, transparent and timely way that looks at more than just one option and talks to patients, charities and a range of experts too. I beg to move.
Baroness Hayter of Kentish Town
My Lords, like the noble Baroness, Lady Morgan, I think the fact that this amendment is necessary comes as a surprise. When we started discussions of the Bill, it seemed that the issue of whether recipients of debilitating cancer treatment in the form of oral chemotherapy should be automatically exempted from requirements to look for work was being dealt with in a sensible manner by discussions between the cancer charities, cancer specialists and the Government. It is extremely disappointing to find that these discussions appear to have broken down. Disappointing for us, but extremely worrying for the many cancer patients anxious about what support they will be able to claim and how they will qualify for it when their main focus is living through and coping with some pretty debilitating—as we have heard—albeit wonderful, lifesaving treatments. The Government’s response to the second Harrington review states that its new proposals to ask everyone experiencing cancer treatment to go through the work capability assessment process,
“would increase the number of individuals being treated for cancer going into the Support Group”.
It also states that:
“They would also reduce the number of face-to-face assessments for people being treated for cancer as most assessments could be done on a paper basis, based on evidence presented by a GP or treating healthcare professional”.
While we welcome the acceptance of medical evidence, this proposal still puts cancer patients undergoing treatment through the uncertainty and stress of not knowing whether they will qualify for essential financial support or whether they will be expected to prepare for work while undergoing their treatment. With the proposals to time limit employment and support allowance for those in the work-related activity group, these assessments take on an added importance, since for many people they will determine when the clock starts ticking to the point when they will lose this contributory support altogether.
We do not think that anybody should be written off because they have cancer. We certainly do not think that no one with cancer will ever be able to work again. A brief glance behind me in your Lordships’ House is great testimony. This is not, however, what automatic entry into the support group means. We know that those in the support group can volunteer for access to the work programme and the support there to help them get back into employment. We imagine that the vast majority of those who have overcome their cancer will want to do just that. But for the Government to suggest that those receiving chemotherapy need to be tested to see whether they are really ill enough to avoid a conditionality regime, which we will remind the House was intended to put pressure on people to return to work, suggests that the Government somehow view all cancer patients as potentially taking advantage of the state. We are sure that that is not the Minister’s view and therefore hope that he will be able to accept the amendment.
Lord Freud
My Lords, this is obviously a very sensitive issue, and I want to start by saying that we are determined that the benefit system should support in a sensitive, fair and appropriate way people who are diagnosed with cancer and coping with it. I shall try to go through the argumentation here in as simple a way as I can.
First, we know that cancer and cancer treatment affects individuals very differently. That was one thing that the Macmillan evidence demonstrated. It shows that some people can continue working straight through their treatment, are capable of doing so and want to do so. On that evidence, we believe that automatically putting everyone undergoing certain cancer treatments into the support group is not the right way forward. Clearly, there is the example that the noble Baroness raised, the one in the Sunday Times, of Jenni Murray, who had a bad reaction, and one can only sympathise with that. Everyone in this Chamber will have friends or relatives who have gone through this experience and had a bad reaction. It is always painful. We are all thinking exactly the same thing; we are all thinking of someone we know who has gone through hell on this process. But when you talk to the experts, you get examples of someone—let us take a man—who has had testicular cancer and has recovered well from curative surgery and is now being treated with radiotherapy without any significant side effects. On this ruling, he would be automatically placed in the support group. That is a kind of counter-example, which half of us should be so lucky to have.
Baroness Morgan of Drefelin
When we look at the Macmillan recommendations, we can see that they take into account that people respond in a range of ways. In the recommendations that the charity made to the Harrington review, they came up with a lot of detail, and I could read it all out. No—I will not read it all out, but I could.
The point that I want to make is that a consensus process was gone through at the request of a government review. We could all pick out little bits of that wide range of opinion that we do not want to promote, but that was not what the charity did. It published it all, which now allows the Government to pick bits out that suit the argument. But the overall conclusion by the experts and the consensus statement was that, for the majority of cancer patients going through specific cancer treatments—and it is not all chemotherapy; we are not talking about long-term oral chemotherapy here—it is more likely than not that they would experience debilitating effects.
Lord Freud
Let me go through the argument and I will pause just before I sit down to let the noble Baroness come back on the process. We asked Professor Harrington and Macmillan to review the current descriptors to provide evidence as to whether they could be improved, and we are committed to acting on the evidence that they put forward. The evidence provided by Macmillan showed clearly that there is no longer a basis for differentiating between certain types of cancer treatment in the way that current regulations do. The evidence showed that all types of chemotherapy, including oral chemotherapy and certain radiotherapy, can be debilitating but it also showed that there can be considerable individual variation in the impact of the treatment on each person, and that work can be very important for some individuals with cancer.
I think that there were 16 medical professionals—the oncologists—who were consulted in depth in this evidence. I shall quote just one as an example, who said,
“I am somewhat against the concept of including all chemotherapy”,
in the support group,
“as it will clearly be inappropriate for some patients, risks stigmatising these patients in the workplace and may delay useful reintroduction to the workplace”.
A number of the experts consulted by Macmillan, and indeed Macmillan itself, volunteered evidence of the importance of work to an individual’s rehabilitation and emotional well-being. Indeed, in a recent publication, Macmillan said:
“Many people who are working when they are diagnosed with cancer would prefer to remain in work, or return to their job, during or after treatment”.
From this evidence, it is clear that while many people will not be able to work, some can and do. For them, it is an important part of coping with their diagnosis and treatment.
We want the work capability assessment to effectively reflect this new evidence based on what Macmillan, supported by Professor Harrington, has found. How it would work is that each individual would be assessed on a paper basis. The evidence required might be a note from the claimant’s GP or consultant, and where a claimant is unable to provide information an Atos healthcare professional will contact their GP or consultant to gather the information and ensure that they are not unnecessarily sent on a face-to-face assessment.
We have had a request to look at this evidence more widely, so we are in the process of asking Macmillan whether we can make this document more widely available. At the moment, Macmillan is seeking permission to do that. I hope that that actual evidence becomes more widely available for consideration. We believe that our proposals meet the spirit and intent of Macmillan’s assessment. If that were to be the case and we were to go ahead with those proposals—if your Lordships will bear with me, I will describe the process before we were to go ahead—there would be an increase in the number of people in the support group. About 10 per cent would move from the WRAG group to the support group, while there would be a reduction in the number of face-to-face assessments that individuals suffering from cancer would undergo.
Let me provide another example of how this will better support people by citing a woman who is being treated via oral chemotherapy and who is profoundly fatigued due to the treatment. Her GP confirms her diagnosis and symptoms. Currently, she may be invited for a face-to-face assessment; under the new proposals, she could be placed in the support group on a paper basis.
We are disappointed that Macmillan seems to be unable to support these proposals, which we have based on the evidence that it spent so much energy in collecting, and because we had hoped to introduce the proposals in April 2012. However, since we do not seem to have Macmillan’s support at this particular moment, we will now seek a wider range of views through an informal consultation. As part of this we will seek the views of individuals affected by cancer, their families and carers, healthcare practitioners and cancer specialists, as well as representative groups and other lobby groups. We want to ensure that the benefits system treats individuals with cancer in the most sensitive way.
I recognise the points raised today. We want to get the balance right, which is why, as a result of the evidence presented by Macmillan, we will launch the consultation on these proposals this Friday. It will be informal; it will last 12 weeks, ending on 9 March, and it will follow the advice in the government Code of Practice on Consultation. We will be looking, as I said, for a wide range of evidence, and will consider all the issues, including automatic entitlement, as well as looking at previous experience of cancer assessment in the benefit system.
I hope that that will reassure noble Lords that there will be a proper process which will aim to come out with an answer which gets the general support of this particular community, and I hope that many of them would be a temporary part of that community. The noble Baroness is getting to her feet; I will hover.
Baroness Morgan of Drefelin
I think that the Companion says that the Minister is able to respond on Report, so it is very nice of him to hover, but he can have a rest.
Obviously the automatic entitlement is set out in regulations; I think the powers are in the 2007 Act. It would be really helpful to understand what this paper basis will look like. Will it be possible for us to see what those regulations might look like? I cannot remember whether they are affirmative or not. I guess they probably are, but if they are not, then maybe they should be.
Lord Freud
Rather than go into detail now I would like to wait for the proper consultation. The document is coming out in two days; it will lay out the issues, the proposals and the background, and there will be a full opportunity for us to gather all those views and pull them together. With that reassurance that there is a real process going on to get agreement and to take everyone’s views, I hope that the noble Baroness feels that she can withdraw her amendment.
Baroness Morgan of Drefelin
My Lords, it is very late and I have only a couple of thousand words to get through. More seriously, the Minister has given me quite a lot to think about. Obviously, as this is only the first time that we have had a proper discussion about this, I will have to look at Hansard very carefully, and think about whether I need to come back to it. However, I appreciate the time that the House has given to this issue at this late hour, and I beg leave to withdraw the amendment.
Lord McKenzie of Luton
Lord McKenzie of Luton
My Lords, I will be brief on Amendments 27, 30, 31 and 29, which deal with sanctions. However, given the hour, there is just one particular point I wish to pursue.
We have already had the assurances of the noble Lord and his colleagues that there will be no target set in respect of sanctions. That is clearly on the record in Committee. We might like one more go at it, but we need not spend any more time on that. In the other place we made the argument for reducing the maximum sanction from three years to one. Given where we are, I do not see merit in going over those arguments again; we will just have to differ on that.
The point that I wish to pursue is the opportunity for people to mitigate that longer-term sanction. My noble friend Lady Hollis touched upon this briefly in Committee. If someone is sanctioned for three years, your leverage to encourage them closer towards the labour market is very limited. Three years is a long period of time; people change and perhaps understand the consequences of what they have done. It seemed a reasonable proposition that they should have an opportunity of mitigating and reducing that three-year period. That is the point that we wanted to pursue in this amendment. I beg to move.
Baroness Hollis of Heigham
My Lords, I strongly support my noble friend on his last point. The whole point of sanctions is not just to punish but to change behaviour. If someone does so and therefore, having learnt their lesson, is willing to comply, they should get rewarded for that, so to speak, otherwise there is no incentive for them to change their behaviour. I hope that the Minister will hear my noble friend’s wise words, otherwise the sanctions regime will not work or stick—and, I suspect, will end up being judicially reviewable.
Baroness Meacher
My Lords, I shall speak extremely briefly to Amendment 28, which is in this group, but I would not wish the House to take the brevity of my remarks as an assessment of the importance that I attach to it. The amendment concerns thousands of people up and down the country with mental health problems, mental impairments and learning difficulties and would affect whether they are fairly treated or denied benefits unfairly because of misunderstandings and a failure to understand why those people have failed to comply with the conditionality requirements and then have their benefits removed or cut.
I emphasise that it is not sufficient, as I believe the Minister said in Committee, that if a matter is drawn to the attention of the officials, they will take that matter into account. Many of these people will not be aware that they need to make that clear; they will not even necessarily have the capacity to make it clear that their disability, handicap or learning difficulty prevented them satisfying the conditionality requirements. They may indeed be lying in bed, not opening their post, not answering the phone, not responding to requests to come for an interview and so on.
The Minister is very familiar with these issues, but I was concerned in Committee that he seemed simply to suggest that a person can point out that they have a problem. I would be interested to know whether he can assure the House that specific actions will be taken by officials to ensure that they have considered and checked whether a person has a mental health problem or a learning difficulty, and whether that has in fact affected their capacity to respond.
The other issue in the amendment has to do with reasonable adjustments. Of course there are people who cannot get to the office and attend an interview or assessment, such as people suffering with agoraphobia. Many others are also sufficiently unwell in a mental health way that they simply will not be able to perform as others might. Reasonable adjustments have to be made for those claimants if they are going to be fairly assessed and not sanctioned unreasonably. I will be very interested to know what the Minister has to say in response to these issues.
Baroness Turner of Camden
My Lords, I would like to speak very briefly to Amendment 36, which is in this group. This relates, again, to sanctions, and is an attempt to amend Clause 46, talking about high-level sanctions, which says that it is a failure sanctionable under this section if a claimant,
“through misconduct loses employment as an employed earner”.
Not all allegations of misconduct are accurate; sometimes the employee may claim that he is being discriminated against, or perhaps that he has blown the whistle on some unsafe practice and has not been guilty of misconduct. He therefore attempts to institute proceedings to try to demonstrate that the dismissal is unfair.
In such circumstances it seems that it is in line with employment rights if the employee is not sanctioned under this provision, because he has disputed whether or not his dismissal was fair, and has instituted appropriate proceedings. It is quite a simple amendment, designed to protect people’s employment rights, and I hope that the Minister will be prepared to look favourably upon it.
Lord Freud
My Lords, I will also try to be as brief as possible. We had a very good discussion on this area in Committee, and I can make clarifications which have been informed by some of that discussion. One of those clarifications is that we will limit the sanction amount to three years, so we will not have it compounding above that level.
The second relates to the parable of the prodigal son. From the argument of the noble Lord, Lord McKenzie, there has got to be a way back into the system. We are trying to change behaviour: where someone has come back and got a job for six months at his job goal level, we will take away his sanctions at that point. I thank noble Lords for the very informed debate that we had.
Baroness Hollis of Heigham
Did the noble Lord say that if the person got a job, after six months in the job the sanctions would be removed?
Baroness Hollis of Heigham
I do not think that is good enough. That means that coming back in and searching for the job—in other words, conforming to the sanctioning conditions—is not enough. He also has to be successful, which will depend on the lottery of what jobs are available, and so on. I would have thought that providing he is conforming to the work conditionality regime in searching for a job, that ought to be enough. You should not be able to punish him just because he lives in Merthyr Tydfil and the jobs are not there, whereas in central London they may be.
Lord Freud
My Lords, we thought about this matter very deeply and thought that it was very hard to genuinely measure compliance if there was not a hard result. We decided that the hard result was taking a job and holding that job for six months, and then we would take away the sanctions. That is where we are. It is a lot better than where we were.
Baroness Hollis of Heigham
But if that means that he was previously on JSA and HB as part of his universal credit, and he has now gone into low-paid work, so is getting a wage, then presumably if the sanctions still apply he would fail to get the housing element going into his universal credit, and he would not have enough to live on.
Lord Freud
No, my Lords, the sanction regime does not work like that. It takes away the equivalent amount of the JSA, so you keep getting your housing credit, but have this amount taken off, which will be a proportion of the total universal credit.
Baroness Lister of Burtersett
I am sorry to interrupt the Minister, but is he saying that the department is unable to measure compliance with work-seeking requirements? If that is the case, surely the whole basis of the sanction regime falls apart?
Lord Freud
I think I can safely say that we are not saying that. We are just saying that we want real proof of a change. The prodigal son must do more than turn up and warm his hands on the fire as the fatted calf is slaughtered. I am saying that he has to take a job and hold it for a minimum of six months.
Baroness Hollis of Heigham
Could the noble Lord perhaps move from the Old Testament to the New Testament?
Lord Freud
I thought it was the New Testament. It is definitely a New Testament matter. I am shocked that the noble Baroness—
Lord Freud
I am utterly shocked. Let me keep going; the hour is late and I am forgetting what I am talking about very quickly.
Turning to Amendment 28, we will impose reasonable requirements, taking into account the claimant’s particular circumstances, including any health condition or disability. Universal credit claimants with a health condition or disability that limits their capability for work will not be required to look for work. There are specific safeguards in this area. Decision-makers must consider any relevant matter raised by the claimant when considering whether there is good reason for a failure.
Baroness Meacher
That was the issue in Committee. Does it have to be raised by the claimant?
Lord Freud
When I say “by the claimant”, it can be done on behalf of the claimant by someone else. There is a clear duty on decision-makers to watch out for vulnerable people. The request I am making of the noble Baroness is this: if we begin to introduce specific legislative provisions around such matters of detail, we will end up with a whole mound—
Baroness Meacher
I thank the Minister for giving way. What I am looking for is an assurance that, in regulations, the Minister will guarantee that officials will ensure for themselves that this person could perfectly reasonably comply with conditions. That is all I am looking for—an assurance.
Lord Freud
Can I leave it like this, without giving a hard commitment right now, on my feet? When we get to the regulations on this, I will look very hard at exactly what the protection is. I cannot offer any more now but I am sure we will debate this in the months to come. My main point here is that overall duties, rather than lots of specific ones, are the way to go.
Let me turn now to Amendment 36, which proposes an exemption from the sanction for losing employment due to misconduct where the claimant disputes that the dismissal is fair and has instituted proceedings—in other words, is taking a case to an employment tribunal. First, I assure noble Lords that the decision-making process around sanctions for misconduct is rigorous and rounded. We are proposing nothing in this Bill that changes the current process. Decision-makers will take all relevant matters into account when determining whether a sanction should apply, including evidence about whether claimants have left employment through misconduct or been unfairly dismissed. If a tribunal finds that there has been no misconduct by the claimant, this will be very compelling evidence. Where a decision-maker decides that there has been no misconduct, a sanction will not be applied.
However, we do not consider that there can be a blanket rule which says that, where a claimant has instituted proceedings for unfair dismissal, sanctions cannot be applied in that case. One of the reasons for this is that we want to avoid creating a perverse incentive for claimants to make claims to employment tribunals, which would put a burden straight on to employers for no fundamental reason. Decision-makers must have the flexibility to look at each case on its facts and to assess the strength of the evidence. I trust noble Lords will agree that this flexible, case-by-case approach is the right one.
The final amendment, which the noble Lord touched on right at the beginning, and which seemed like a game of tiddlywinks between us, is on targets. He knows what I am going to say—his side likes targets, we do not like targets—so I will say it, as it just keeps the night going. We will continue to collect this information to support our work. We need to know how many sanctions are being imposed, but collecting information is not the same as using it to target. It helps us to assess the consistency of approach in this area and to monitor and evaluate the impact of those sanctions, so that is what we are collecting.
On the basis of that rather rapid, somewhat biblical, summary I would ask noble Lords to withdraw or not move these amendments.
Lord McKenzie of Luton
My Lords, I thank the Minister for his reply. I thought we were going to have a quicker canter through these issues, and we may wish to return to at least one of them at Third Reading. In relation to the mitigation issue, I am obviously grateful for the Minister’s consideration of that and recognition that there is an issue to address. However, like my noble friend, I am a bit dismayed that the route to dealing with it is the six months—
Baroness Anelay of St Johns
My Lords, I know that we are in a cordial mood and we have reached a magical moment as far as noble Lords and perhaps the staff, too, are concerned. As Government Chief Whip, I ought gently to remind the noble Lord, who was a Minister himself with distinction, that Third Reading rules are very carefully framed by this House and I know he would not wish to breach them. There are matters which may very properly be brought back at Third Reading. I know that he will consider whether any wish he expresses now to bring back at Third Reading will later be translated into action only within the rules.
Lord McKenzie of Luton
Indeed, my Lords. We aspire to do nothing but stay within the rules. We would not dream of treading outside of them.
It is disappointing, for the reason my noble friend gave, that if the idea is to get somebody to re-engage, it must surely be possible to evaluate prior to them actually getting into work. After they have been in work for six months, it may be that there is frankly not a lot to sanction in any event. It depends on the level of earnings and the impact of universal credit on that. I would urge the Minister to reflect and think again on this point. We have had our exchange on targets and I understand that the data are still going to be collected. I trust they are not going to be posted on office notice boards to act as an indirect incentive. I accept the Minister’s assurance on that.
The noble Baroness, Lady Meacher, made a very important point which has not, I think, been fully addressed. In summary, she is seeking a requirement for the department to be proactive with people before they are sanctioned, not just relying on them to respond, question and challenge.
My noble friend Lady Turner’s amendment raises an interesting point. If the decision maker is going to make an up-front judgment as to whether there has been misconduct by an individual who has left work or whose employment has been terminated, this might pre-empt the role of the tribunal itself, whose job it is to make that assessment.
I am not sure how that sits four-square but, given the hour, I would urge the Minister to reconsider the first item in relation to mitigation. I am sure we will all be happy if we can avoid Third Reading and a possible challenge from the noble Lords’ Chief Whip. I beg leave to withdraw the amendment.
Lord McKenzie of Luton
My Lords, we were happy to try and continue a bit further to reach the target amendment. My noble friends are nodding in agreement. Perhaps it is not too late.
Baroness Anelay of St Johns
My Lords, I know that it is unusual for the noble Lord to put such a matter. I certainly am content to accept that offer, but I do not wish in any way to make the House feel that it is being overworked. I am looking carefully at the opposition Front Bench and I see the noble Lord, Lord McAvoy, giving his consent. Perhaps I may check with my noble friend the Minister. We are all aware of the other side of the coin of that offer, to which I have no objection whatever. It is a perfectly normal way for an Opposition to behave and I certainly recognise it as such. It is a generous offer met in generous spirit. Perhaps we may continue.
Lord De Mauley
I beg leave to withdraw my Motion to adjourn further consideration on Report.
Motion withdrawn.
Schedule 1 : Universal credit: supplementary regulation-making powers
Amendment 32
Baroness Donaghy
Baroness Donaghy
My Lords, the amendment was in the first grouping on the first day of Report, when we were all bright-eyed and bushy-tailed. I asked for this to be degrouped, and I therefore accept my punishment with good grace.
I asked for the amendment to be degrouped because the issue of self-employed people is extremely important and deserves a slot on its own. The purpose of the amendment is to recognise the particular needs of the self-employed. It will ensure that the power to prescribe a minimum level of income applies only to those self-employed claimants if they under-declare their earned income with a view to maximising their entitlement to universal credit.
While it is important to prevent abuse of the system, it is equally important not to discourage the genuine self-employed claimant with a potentially viable business in the early stages of development or in financial difficulty. There are some 4 million self-employed people in the UK and that number is likely to grow as employment becomes more difficult. They are an enormously varied group who face a greater degree of risk than traditional employees. Profits are affected by any number of events—the loss of a key customer, the sickness of the sole proprietor, a bad debt, the accumulation of slow payers, or even taking on a new employee.
The measurement of self-employed income for universal credit purposes should follow generally accepted accountancy principles and aim at a true and fair view of a business’s profits. The welfare system needs to support business through such periods, not discourage them by imposing unrealistic levels of deemed income such as the minimum income floor. My amendment recognises that real abuse should be directly targeted. If you impose a minimum income floor for each hour worked, that in itself will open the floodgates for abuse. That view is supported by the National Farmers’ Union, the Tenant Farmers’ Association and the Federation of Small Businesses, as well as Community Link, Citizens Advice and the Child Poverty Action Group.
There are those with a disability or medical condition which makes it difficult for them to take traditional employment. Indeed, it is often difficult for the disabled to find employment. Being self-employed allows the disabled to work at their own pace and according to a pattern which suits their circumstances.
What steps are the Government taking to minimise the compliance burden on the self-employed? The current system requires only one set of accounts to be prepared, which is accepted for both tax and tax credits. That allows the individual to get on with running their business. If a different measure of self-employed income were to apply for universal credit, the burden would be increased by having to assess profits for tax purposes according to one measure; and income for universal credit purposes according to another, quite different measure. If income is to be based on reported hours, the harder a self-employed individual works to get their business on its feet, the more they could lose from their universal credit entitlement.
It would be unfortunate if the measure were to put off genuine claimants from taking the risks inherent in self-employment, when its purpose was to deter a minority from underdeclaring their profits. One real example, which I gave in Committee, was of an arable farmer whose crop was completely destroyed. I was going to give another detailed example of livestock farmers who could not move them if they were under BTB restrictions, but in view of the hour, I will not.
There are already regulatory powers to counteract moves by claimants to underdeclare their income for tax credit. For benefit purposes, under the income deprivation rules, a person is deemed still to have income of which they have divested themselves to maximise their claim to benefit or tax credit. Where the Government perceive that abuse, surely the right course is to enforce existing powers rather than to invent new ones which will discourage genuine cases.
This brings me to a group who are in practically every sense of the word employees, but where individuals are treated as self-employed because the alternative is no job at all. They are often referred to as bogus self-employed. The Government's difficulty in drawing up criteria to deal with the genuine self-employed may be alleviated by proper enforcement of the tax laws by HMRC and employment laws by the BIS department, with all the resources that that implies. It also means a greatly increased level of interdepartmental co-operation in Whitehall.
As I said earlier, self-employment entails a greater risk than traditional employment. The self-employed must often choose between taking drawings for themselves or reinvesting in the business to enable it to grow. Welfare policy must reflect those different needs if it is to succeed in promoting work through self-employment. The success of working tax credit in encouraging work and, in particular, self-employment, rests on its recognition, in alignment with the tax system, of the economic reality of how a business is doing—particularly with regard to investment in business equipment and trading losses. Will the Minister indicate what guidelines will be issued and when? I ask him to accept my amendment, which aims at the real target, rather than those struggling to survive in these deeply difficult times. I beg to move.
Lord McKenzie of Luton
My Lords, my noble friend Lady Donaghy has made a very strong case, and I look forward to the Minister's response. What she said warmed the cockles of my heart. She referred to generally accepted accounting principles—the true and fair view—and it took me back to another life, but she raises a real issue: rather than having artificial rules for assessing what people are deemed to earn, is it not better to try to capture the actual profits and to target resources on those who seek to abuse the position? That seems a very straightforward matter.
My noble friend raises once more, as she did in Committee, the matter of bogus self-employment. We all know that that is a continuing issue. I have always believed that it rests particularly with HMRC, together with BIS and other departments of government, to make progress on that. It is primarily HMRC that could begin to make a real difference. She wrote reports for the Government, as did the Minister, on the construction sector, and health and safety in particular. There is bogus self-employment in that sector, so she is an expert on that matter. We support the thrust of her amendment.
Lord Freud
My Lords, when we discussed a similar amendment to this in Grand Committee, I explained that we intend to retain the existing practice in the benefit system whereby claimants can be treated as having income or capital in cases of deliberate deprivation. However, we believe that different issues arise in relation to self-employment. We think that it is right in principle to apply a minimum income floor to claimants who choose to be self-employed but whose earnings do not make them financially self-sufficient. I confirmed in Committee that the floor will not be based on the hours claimants work. We assume that claimants’ earnings are at a level that we would expect from claimants with similar circumstances in employed work.
Claimants will not be forced to take reduced benefit payments by accepting the minimum income floor. Self-employed claimants will have the choice in universal credit. Some will choose to continue solely with their existing activity with the expectation of increasing their earnings. They will accept the minimum income floor. Those who do not will need to satisfy conditionality requirements. The conditionality regime will aim to guide the claimant towards the most appropriate form of gainful work. For some claimants, this would combine their self-employed activity with part-time employed work. In other situations, the regime may very well encourage the self-employed to keep going in their self-employed efforts. We will need to build a quite sophisticated regime to manage this.
This approach differs from tax credits, which allow claimants to receive maximum support so long as they declare that they are working a minimum number of hours. However, in 2009-10, for example, around 60,000 of the households claiming tax credits that received some or all of their earnings from self-employment declared earnings of under £2,500 a year—less than £50 a week. While this is legitimate under current rules, we believe that some intervention to guide claimants towards increasing their income is justified in return for state support.
Baroness Hollis of Heigham
Can the Minister explain what he expects here? The old enterprise allowance scheme, which was very effective, used to give people a top-up of £40 a week to start a business, and as far as I recall this ran for up to two years to give people a chance to establish a small business. How long will someone be allowed to have low earnings while they try to build up a business, and how quickly will guidance from young people in Jobcentre Plus, who frankly have never tried to start a business, steer them back into sanction and conditionality?
Lord Freud
I do not automatically think that we will use the example of young people in Jobcentre Plus to deal with some of the more complicated issues here. We acknowledge that the real issue is that we need to create an environment that encourages entrepreneurship. We need to balance the exact rules about the interrelationship between the new enterprise allowance and the time that we will allow. I do not have the exact figures yet, as we are still currently elaborating them. We are looking through all the details of employment earnings. Clearly, the HMRC is expert in this area and we are working closely with it to develop our proposals. I must say to the noble Lord who said that it was a straightforward matter that on that basis he can come and help us to do it.
We are aiming to get the reporting requirements aligned as closely as possible with the tax system. However, in our view, it is reasonable for claimants to provide clear information on their income in return for state support. We are looking at a number of rules within the current benefit and tax credit systems to see what the most appropriate approach is for universal credit. We will then prepare regulations that will set out clearly the way in which earnings from self-employment will be assessed. This House will have the opportunity to debate those regulations in due course, and I think that that will be a fascinating discussion.
In today’s debate we should focus on principles. We clearly need to avoid requirements that will add unnecessary burdens, especially for people who are starting out in business—the people whom we really want to encourage. However, we cannot have a situation where people can be treated as being in full-time work for conditionality purposes, but because they declare no earnings they receive as much benefit as though they were not working at all. That is taking it to the absolute extreme. I hope that this explains why the Government cannot support Amendment 32 and that the noble Baroness will feel able to withdraw it. I know that we will be discussing this area again.
Baroness Donaghy
I thank the Minister for that response, and I look forward to seeing the regulations. However, I still have a concern and refer again to my example of a farmer who cannot move his livestock and is therefore getting no income. He is having to work harder than ever but will not be able to get a part-time job.
Lord Freud
My Lords, I forgot to say something. There are two areas where we need to get really smart. One is the start-up period and the other is when a business hits a problem. The questions there are how long the process should be and what one allows. That is another area that we are actively looking at.
Baroness Donaghy
I am reassured by that. I certainly agree with the Minister that this is a very complex area and, as I said in moving the amendment, it involves a very varied set of problems. I look forward to seeing the regulations and beg leave to withdraw the amendment.
Baroness Hollins
“Criminal injuries compensation
For the purpose of this Part, a claimant in receipt of criminal injuries compensation, whether or not this is held in trust, will not have this amount included in the prescribed capital sum in section 3.”
Baroness Hollins
My Lords, in speaking to the two amendments in this group, I want to mention a personal interest in the issue that I shall be talking about, as some years ago a member of my family was affected by it.
As noble Lords know, the capital of a claimant is taken into account when assessing the level of benefit to be received. If the amount of capital is greater than a prescribed amount—I think it is currently £16,000—then the person’s benefits are adjusted accordingly. There are several exceptions to what is counted as capital and these include any funds held in trust. This is clearly outlined in the 2009 Housing Benefit/Council Tax Benefit Guidance Manual, which states that certain types of capital should be disregarded in full, including the value of any funds held in trust and the value of the right to receive any payment under that trust following payments made to the claimant as a result of a personal injury, such as vaccine damage payments or criminal injury compensation. The value of these funds is not taken into account when calculating the capital of the claimant. Therefore, any payment made into the trust as a result of a personal injury, such as criminal injuries compensation, will not count when the claimant’s benefits are considered.
These amendments seek to apply the principle that claimants who have received criminal injuries compensation should not lose benefits, regardless of the form in which it is received or kept. A year later, the 2010 Housing Benefit/Council Tax Benefit Guidance Manual states that officials should treat lump sum compensation payments as capital. Examples given include lump payments, such as those made by the Criminal Injuries Compensation Authority. However, the manual then reminds officials to disregard the value of any compensation payment for personal injury which is held in trust. I believe that criminal injury compensation payments should not be considered as capital at all when assessing the levels of benefit, regardless of whether this is a £1,000 payment for 12 weeks of blurred vision or the maximum of £500,000 which is paid out for injuries leading to indefinite loss of earnings. Recipients of larger sums are likely to put this into a trust, but recipients of smaller sums are not. They may intend to use it for a holiday—some recompense for the injury that they suffered. One of the purposes of criminal injury compensation is to give recipients the opportunity to improve their quality of life after their trauma.
These amendments would benefit some victims of crime, particularly people with mental health problems or learning difficulties. Not only are they more likely to be in receipt of benefits, they are also more susceptible to being victims of crime. The benefits that they receive are provided to cover essential costs, and any payments made as criminal injuries compensation are made in recognition of pain and suffering that the victim has gone through and perhaps for the purpose of making up any lost earnings.
The idea that the benefits that the person is receiving and the criminal injuries compensation provide for two distinct purposes is very important. It is for this reason that allowing one to influence the level of the other would be unfair. The Minister may consider that Clause 5 would have been a better place for these amendments. I hope that he will accept these amendments or undertake to bring them back at Third Reading in a more appropriate form. I hope he will reassure me that these simple amendments would be acceptable. I beg to move.
Baroness Hollis of Heigham
My Lords, I strongly support the amendment. I had the privilege many years ago of being responsible for vaccine damage payments within the department and always tried to make a distinction between payments that were in lieu of earnings, which tended to be of the incapacity benefit sort, and payments which were a lump sum. Sometimes there was a structured payment of capital over a period of time as compensation for suffering and injury as opposed to an earnings replacement. We always excluded that second element from coming within the debiting of benefit. That distinction has been well drawn by the noble Baroness, Lady Hollins.
I hope that the Minister can respect the ethics as well as the long history of making a distinction between getting an income replacement benefit—ESA, for example—and getting an element of compensation for damages, for suffering, for pain and so on. In my understanding that has always been protected and has not been debited against your rent. Otherwise it is not worth anything to you at all. That was never the intention of the law. I hope that the Minister can support the proposals of the noble Baroness, Lady Hollins.
Lord McKenzie of Luton
My Lords, the noble Baroness has brought an important point to our attention. I have only two questions for the Minister. Can he explain the extent to which the current rules are going to be translated and taken up in universal credit? The position at the moment is that the compensation recovery scheme does not apply to criminal injuries compensation. Can the Minister say whether that would continue under universal credit?
Lord Freud
My Lords, Amendments 32A and 34A seek to use primary legislation to exclude criminal injuries compensation from the capital test for universal credit. The existing benefit system does not have a specific disregard for criminal injuries compensation. However, such payments will usually fall under the rules governing personal injury payments where they relate to physical or psychological injuries suffered by the claimant. As indicated in the illustrative draft regulations on capital and income, shared with noble Lords in September, we intend to replicate these personal injury payment provisions in the universal credit regulations. I hope that that answers the question of the noble Lord, Lord McKenzie.
Personal injury payments are disregarded in the current benefit system for a period of 52 weeks from the date that they are paid. Even after that period, remaining capital will continue to be disregarded if it is placed in a trust, as the noble Baroness, Lady Hollins, indicated. This rule allows us to distinguish the personal injuries payment from other savings. If the payment is not separated by placing it into a trust, it becomes increasingly difficult to identify the source of the capital as time goes by. Ultimately, any capital test must consider the balance in a claimant’s account, and over time it becomes impossible to say whether it is from one source or another unless it is held in a different form. That is the reason for the way that this is structured.
The current arrangements are long-standing, and we are not aware of significant practical problems with their use. In any case, the details of capital disregards are a matter we will address in the universal credit regulations. If there are particular problems, we will have a further opportunity to consider them when drafting regulations, and I will bear in mind the points the noble Baroness has made.
In answer to the question asked by the noble Lord, Lord McKenzie, I agree that the compensation recovery scheme does not apply to criminal injuries compensation.
I hope I have made clear why the Government cannot support Amendments 32A and 34A. I hope the noble Baroness will withdraw her amendment.
Baroness Hollins
Given the lateness of the hour, I will withdraw my amendment. I will study very carefully what the Minister said to make sure that I understand it. I think what he is basically saying is that it should be possible to protect that capital for 52 weeks, and I understand the point, but it is a little bit more complicated than that. I beg leave to withdraw the amendment.
Lord De Mauley
My Lords, let me try again: I beg to move that further consideration on Report be now adjourned.
Consideration on Report adjourned.