Westminster Hall

Wednesday 8th February 2012 Westminster Hall

Wednesday 8 February 2012

[Mr Andrew Turner in the Chair]

British Exports

Wednesday 8th February 2012 Westminster Hall

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

09:30

[David Rutley (Macclesfield) (Con)]

Good morning, Mr Turner. It is an honour and a pleasure to serve under your chairmanship. It is also an honour to have secured today’s debate. I am grateful to Mr Speaker for selecting the subject, because I think it will provide an important opportunity for hon. Members to discuss matters that are critical to our economy and growth agenda. I take the opportunity to congratulate the Under-Secretary of State for Business, Innovation and Skills, the hon. Member for North Norfolk (Norman Lamb), on his recent promotion. It is good to see him here, and we look forward to hearing from him and the shadow Minister. I want to express my gratitude to colleagues and friends for turning up at the debate today. There is huge enthusiasm and energy for the subject, and I am sure there will be some stimulating contributions.

I declare an interest up front. I am a member of the all-party group on China, and I will explain why that is relevant. In December, I was fortunate to go to China for the first time on the all-party group’s visit to Beijing, Shanghai and Chengdu. It would have been difficult not to be impressed by the incredible growth in that country. I was told that 45 airports had been built in the past five years. The subway system in Shanghai, which is bigger than London’s entire tube network, was built in 15 years. In the UK, we would just about have got round to having a conversation about the possibility in that time. There has been real growth. We also went to Chengdu, which I confess I had never heard of before the trip. It is a small, second-tier town with a population of a cool 14 million and staggering growth of 63% over the past three years.

Capitalism is very much alive in China, as is growth to boot. During the week of my visit my world view changed completely, and I came back with enthusiasm for the subject of this debate. That underlines the fact that now is the time for UK plc to go east—just as China is taking forward its “go west” strategy—to try to unlock the opportunities in the vast interior as it becomes exposed to wider economic development.

In terms of context, Britain has a rich history in international trade. It has often been led by daring entrepreneurs looking for new markets, but during the last half of the 20th century, British traders somehow lost their enthusiasm, their sense of adventure and their pioneering spirit for searching out new opportunities. The irony is that that was at a time when the world economy was becoming more of a global economy. Successive Governments and businesses started to look for safe options in Europe and north America, and that must change.

As far back as 1961, parliamentarians were expressing concern about those trends. In a debate, the Earl of Bessborough said—this may sound familiar to hon. Members:

“We live on an island, and the concept of exporting does not come easily to the people as a whole; nor does the man in the street recognise that we live or die by our international trade. To overcome this it has seemed to many of us that there must be support for a national crusade to excite the spirit, to revivify and stimulate every facet—I repeat, every facet—of the export drive.”—[Official Report, House of Lords, 22 March 1961; Vol. 229, c. 1155.]

They don’t make ’em like that any more. I love the word “revivify,” but unfortunately all that sounds a bit too familiar.

Not so long ago, we could boast a truly diverse international trade base. In 1910, our exports to India and China took up 11% of our traded goods. Today, that is 4%. Our challenge is to drive up much-needed exports, and to rediscover Britain’s trading talent.

[Mike Weatherley (Hove) (Con)]

I am sorry to intervene so early. I speak as someone who owned a manufacturing company that won two Queen’s Awards for Export in the 1990s, and which exported to 49 countries around the world. Does my hon. Friend agree that part of the problem for small and medium-sized enterprises is the equity gap between what the banks will lend—usually up to £100,000—and what venture capitalists will lend—over £5 million? The in-between gap is the problem.

[David Rutley]

My hon. Friend is right. There is an equity gap, and I will talk about SMEs, which are the main thrust of my speech. From his experience, he knows more about the problem than I do, and I welcome his intervention.

There are some encouraging signs. We have seen a steady fall in our trade deficit from 4% of gross domestic product in 2007 to about 1% in early 2011, and that is beginning to help to rebalance the economy towards international trade. A recent article in The Economist reported that there are also signs of success in the motor industry. It was estimated that in 2011 the UK manufactured 1.5 million vehicles, and we exported three quarters of those. That is an important statistic, and I understand that Tata is considering expansion of its Land Rover factory at Halewood, and that Nissan will be looking to increase its production and capacity in Sunderland. It also exports to many countries around the world.

There is export success not only with motor vehicles and automobiles, but with life sciences. AstraZeneca manufactures many leading-edge pharmaceuticals, and we are seeing real success in Macclesfield where its major manufacturing plant accounts for 2.2% of the UK’s exports, which is a huge contribution. The Government’s life sciences strategy was announced in December, and sets out an approach by which we can obtain extra focus on the sector. One aim in the strategy is to create new partnerships in translational medicines and biopharmaceuticals between the UK and China so that those partnerships can enhance trade, investment, and research and development that will help us to have greater export success in that area.

Many hon. Members here can talk about, and will probably want to boast about, the export success of companies in their constituencies, but before they do, I want to take the opportunity to do the same. When I was preparing for this debate and when I spoke to more businesses in the Macclesfield area in north-east Cheshire, it became clear that there are some real export success stories. Plastic Card Services manufactures an innovative, biodegradable credit card, and is seeing huge success in Scandinavian markets. Its exports to foreign countries have risen from nothing to 25% in just a year. Over the past 10 years, Ukash, which is a provider of online payment services and has received the Queen’s Award for Enterprise for international trade, has increased its trade to 50 countries. It has a completely different international focus from many of the SMEs that, as a parliamentarian, I work with in Macclesfield.

Although there are success stories, it is important to come back to the challenge that has been alluded to. It is to improve our export performance across the piece, but particularly among SMEs, which is where the challenge is most marked. A short look at the statistics shows that in the UK, only one in five—25%—of SMEs export and are involved in international trade, compared with the European average, which is 25%, and in Germany it is above 30%. We must make a step change. As I said, the problem has existed for a while, but the size of the prize is huge. If we increased the penetration of exports by our SMEs up to the European average, we would wipe out the trade deficit in one fell swoop.

[Chris White (Warwick and Leamington) (Con)]

I congratulate my hon. Friend on securing the debate. He referred to China. Does he agree that with the weakness of the eurozone market at the moment, UK Trade and Investment should try to focus more resources on emerging markets, such as south America and south-east Asia, so that our businesses, particularly manufacturers, have greater access to the fast-growing markets of the world?

[David Rutley]

My hon. Friend makes an important point. The good news is that UKTI has in recent months started to focus more efforts on emerging markets. I cannot speak about South America, but I know that more resource in terms of headcount is being pushed into markets in China and India, which I will mention later. It is good to see the Government responding to that good point.

[David Simpson (Upper Bann) (DUP)]

I congratulate the hon. Gentleman on securing the debate. In a recent statement, the Secretary of State for Business, Innovation and Skills said:

“Securing…long-term economic growth is the Government’s highest priority. Helping entrepreneurs export to new markets and get access to the finance they need are critical to making this a reality.”

Considering the Asian market is estimated to be worth about $42 trillion by 2030, does the hon. Gentleman agree that it is essential that small businesses get access to finance and that confidence is recreated in those small companies?

[David Rutley]

I thank the hon. Gentleman for that intervention. He raises a vital point—access to finance has come up again as a key dimension. The sad fact is, and I will mention this again later, that too many companies do not even want to export and are not aware of the opportunities, so there is a more fundamental problem. Hon. Members on both sides of the House have debated this problem for some time, but now is the time to get on and do something about it. We will talk about that and I am sure that the Minister will welcome further contributions from hon. Members.

How can we raise awareness and ambition, and the confidence that the hon. Member for Upper Bann (David Simpson) mentioned, to reap the rewards in eastern markets or, for that matter, South America? The Government and the business community—it is not just about the Government—can help SMEs to achieve their aims through three areas of focus: education, financing, which we have talked a bit about already, and, most importantly, access to new markets and customers.

On education, it is vital to get SMEs in touch with the best know-how on exports, and that will be one of the most important ways to help them to gain the confidence to want to export. UKTI has an important role to play, and its “passport to export” service gives a free capability assessment to businesses, which can help them to work out how they can be better prepared for the export work they want. However, I return to the point that only 20% of SMEs—one in five—are aware of the available services. It is a huge job just to make people aware that information is available.

One of the most important things that needs to happen is a lot more business-to-business mentoring to pass on experience from one company to another. I am pleased that the CBI’s pathfinder projects, which focus on mid-sized companies, are helping companies to build greater networks and opportunities. UKTI is building an export portal with Yell.com to connect first-time exporters with businesses that have experience in the area. I know, as I am sure other hon. Members do, that lots of local businesses want to pass on their experience to other businesses.

On Monday, I wrote an incredibly well-read article in The Daily Telegraph, which I am sure all Members have read several times over.

[Mr Iain Wright (Hartlepool) (Lab)]

Absolutely.

[David Rutley]

Thank you.

I have had great feedback from at least one constituent, but it was a good response and it is the quality, not the quantity that counts. A gentleman from Fibrevision, which creates dynamic measurement tools for textile yarns across many countries, particularly developing countries, got in touch with me to say that he would be retiring soon and wanted to spend time passing on his experience to others in the community, and I am going to tap into that. With Lord Green’s work, there are lots of opportunities now to hold export seminars in our constituencies, and I hope that many Members here will participate in such events. It is important to welcome the energy that Lord Green has brought to the task. He is doing a fantastic job as Minister for Trade and Investment, and has given a lot of focus to his task. He has been travelling tirelessly across the country to raise the profile of this work, and he deserves our support.

Transferring knowledge and educating people will go only so far; without the finance to back it, it will be much more difficult for British business to see the success that we want them to have. Let me cite a different example to show what they are up against—or perhaps where we could start heading. In 2010, Germany’s export credit agency supported SMEs in the German market by facilitating €23.7 billion in exports. In the same year, only a small proportion of the £2.9 billion of business that UK Export Finance underwrote went to SMEs. Furthermore, the CBI survey shows that SMEs and other businesses are simply not aware of the available finance. To address the situation, UK Export Finance will now send trade finance experts into UKTI’s regional facilities and the regional network to bring the expertise closer to business, which is good to see. No doubt, the Minister will want to respond to the concerns raised by hon. Members about finance, but it comes back to awareness and building confidence. It is not only about money being available.

It is good to see that the Government are also building bridges to bring the east to Britain. The Chancellor of the Exchequer’s recent announcement of greater co-operation between financial centres in London and Hong Kong will help the City to become a hub for the Chinese renminbi currency market. It will also give SMEs an advantage over the competition, because they will be able to forge stronger links with the new market on their doorstep and get a step closer to customers in China.

In filling the gap in export finance, we should look not only at what is happening with the Government, but at what the banks should do, because it is clear that they, along with professional advisers, have a vital role in encouraging confidence and building momentum in exports and international trade. A poll of small manufacturing businesses found that 51%—just over half—believed that banks were not helping to support their export ambitions. We see that lack of confidence in other areas, but no doubt confidence in banks on this issue needs to be improved. As the Federation for Small Business has highlighted, banks need to promote better, more tailored products to help SMEs in their export ambitions.

I also welcome the Government’s allocation of £45 million to promote exports in other markets. As I said earlier, it is important to get front-line staff working in the new export markets, because what has to happen after education and finance, is that we must roll out the red carpet for our SMEs—make them feel welcome in such markets and to have worthwhile trade visits, particularly in their first forays into foreign markets. Although large companies are well equipped to take on this task, it is pretty clear that smaller businesses lack the know-how, contacts and network to see success in these endeavours, and we must support them.

For too long, UKTI and other Government bodies have spent too much time doing desk-based research, instead of getting out, knocking on doors, finding opportunities and bringing packaged solutions to big infrastructure problems or other projects in those markets. It is great to see the Government working in that area.

[Lorely Burt (Solihull) (LD)]

I feel like I am in an exports master class, so I am enjoying everything that the hon. Gentleman says. I agree with him about the need for UKTI to get out from behind their desks and knock on some doors, but does he agree that the balance of UKTI’s recent work has been very much towards bringing in inward investment, perhaps at the expense of exporting and encouraging outward investment?

[David Rutley]

I thank the hon. Lady for her intervention. She makes a very important point. Of course we need inward investment. We have seen success in that area and we need to continue to see success, but now, the focus needs to be on exports and driving success in that area. I know that she has made important contributions in debates on the subject.

On my visit to China, it was good to see people realising the importance of exports. We met the British consuls from Shanghai and from Chongqing. They are getting out and starting to knock on doors. There has been too much focus on research and, for that matter, paid-for research. I am much more interested—I think that others would agree with me—in knocking on doors. Any of us who have been involved with business know that it is about building relationships. People do business with people, not with pieces of paper.

[Julian Smith (Skipton and Ripon) (Con)]

Does my hon. Friend agree that, to achieve his goal, UKTI needs an injection of private sector talent into the organisation? That would enable it to meet some of the targets that he has set.

[David Rutley]

I thank my hon. Friend for his intervention. That point is vital. It is true for many areas of Government interaction with businesses, but it is particularly true for the area that we are discussing today. There is a huge and staggering opportunity. I think that it has been calculated as being worth $43 trillion. Whatever the number is, it is pretty big. We have to redouble our efforts in that respect. We are certainly putting the headcount on the ground. There are 50 more people in China and 30 more in India, but my hon. Friend makes a good point about the balance of expertise there. Perhaps the Minister will also reply to that, because many of us who have had experience in the business world would suggest that it is time to get people with that experience involved.

Understanding the local cultures is also important. I have not spent a huge amount of time in China, but there are many Chinese-speaking individuals in the UK with business experience. My hon. Friend the Member for Bedford (Richard Fuller), for example, has spent a lot of time in Asia. That is the type of experience that we need to bring to bear to help us in this export drive.

[Laura Sandys (South Thanet) (Con)]

I congratulate my hon. Friend on obtaining the debate. There is something that I do not think we understand and that certainly Government have never used to maximum effect. There are 220 languages spoken by British people in this country. We constantly talk about the language issue, but we have people who may be the first, second or third generation from certain parts of the world and we do not use them effectively as the right cultural interface, the right linguistic interface or, more importantly, as the people who are respected by business people in those countries, as opposed to the people who do not speak those languages being sent out as heads of trade missions.

[David Rutley]

That is a vital point. I met a friend of mine who is a Chinese speaker and has an MBA. I do not think that she really understood the power that she has at the moment in helping to foster export opportunities and to build relationships. My hon. Friend makes an excellent point. I have to say that, as I think about this issue more and more, I increasingly wonder why our children are learning French at school. [Interruption.] This is not meant to be an opportunity to bash—[Interruption.] I think that the debate should be called to order, Mr Turner.

[David Mowat (Warrington South) (Con)]

I can assure my hon. Friend that I have read his article in The Daily Telegraph, as has at least one of my constituents, so that is half a dozen of us in Cheshire. The question that interests me and that I would like to ask him is this. We talk about France and Italy. Both France and Italy export more per head worldwide and to the BRIC countries—Brazil, Russia, India and China—than we do, and they are doing that at a time when our exchange rate has depreciated by about one quarter and the Italian exchange rate has apparently been pegged to the euro and therefore is too high. Is there not an opportunity—the Minister might also wish to respond to this—for us to think as a country about what the Italians do in this regard that we do not?

[David Rutley]

It is an important point that we should learn from our international competitors and look at their success. We have been too complacent. We think that historical ties should automatically bring business to us. Well, I think that we are waking up to the fact that that is not the case any more—as we see—and we should not rely on those historical links. I think that we are too lazy. I can just about speak English and have a conversational understanding of Danish. As I was about to explain when I was so rudely interrupted by my hon. Friends, it is vital that more of our children learn Chinese at school. That has to happen.

I shall finish my speech shortly so that many of the hon. Members present can speak, because I know that they are enthusiastic to do so. We also need big businesses to want to include SMEs in their trade delegations. This is not only about what Government can do. Big businesses have to wake up and bring their supply chain in when they go on trade delegations to China or India. Helping to increase the international attitude of SMEs is vital.

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

Before the hon. Gentleman finishes, I want to draw his attention and that of other hon. Members to a specific issue. He has not mentioned the UK’s largest manufacturing sector—food and non-alcoholic drinks. It should be put on the record that, during the past six years, exports have grown year on year, that, in 2011, the figure for those exports hit £11 billion and that many SMEs are involved in that sector.

[David Rutley]

I thank the hon. Gentleman for bringing that to our attention. It is an important area. I can say with confidence that if my hon. Friend the Member for Penrith and The Border (Rory Stewart) is called to speak, he will be raising awareness of it as well, but I thank the hon. Gentleman for calling attention to it in the debate.

I know that there are huge and major trade initiatives that the Minister and Lord Green will be involved with in the year ahead and that will take up a huge amount of ministerial time. I am thinking of the India-EU trade summit, Russia’s World Trade Organisation accession and the Doha development agenda. All those things are very important. I trust that, in dealing with those issues, Ministers and officials will continue to focus on, and will give just as much focus to, the needs of SMEs. As today’s interventions show, that is a huge priority.

I believe that, in the end, Britain’s SMEs must go east, so that selling in Chengdu and Chennai is just as natural as selling in Cheshire. However, that cultural change will not happen overnight. The Government and the private sector must continue to build on the foundations that have been laid, so that SMEs make the full contribution that we believe they can make to our country’s growth agenda.

[Several hon. Members]

rose—

[Mr Andrew Turner (in the Chair)]

As far as I can see, there will be six speakers in 43 minutes. I call Nick de Bois.

09:57

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

It is a pleasure to speak under your chairmanship, Mr Turner. I congratulate my hon. Friend the Member for Macclesfield (David Rutley) on securing this vital debate. I also congratulate and welcome to his post the Minister. He may be interested to know that yesterday, by coincidence, I received an e-mail out of the blue from a very old girlfriend who happens to live in his constituency. Having finally realised after 18 months that I was an MP, her first words were, “We have the lovely Norman Lamb.”

I am conscious of the time and the need for other hon. Members to speak, so I shall just highlight a few points. The recent euro debate focused on the fact—many people thought that this was a reason to tread very cautiously with Europe—that more than 40% of our trade is with the eurozone. My argument is that that trade is something to be respected, nurtured, looked after and, of course, developed if possible, but the reality is that no one would try to run a business with an over-dependence on one business partner for 40% of their trade. Therefore, it is vital that we look elsewhere.

I noted the comments of my hon. Friend the Member for Macclesfield about history. I do believe that we have relied on history, but I feel that we have failed to capitalise on a number of unique opportunities that reach far outside the eurozone and not just to the east. There are many countries that are growth economies where Britain is uniquely positioned to capitalise on its relationships, whether through historical links, the extensive diaspora that we have in this country from those countries or current strategic and political links. We need an analysis of where those factors merge with prevailing growth economies and economies that are deemed to grow in the future. We should take a snapshot of how we are doing and then realise the potential of what we can do.

Let me share one or two examples based on information from the Library. Britain is one of the few EU states arguing for active support for Turkey’s membership of the EU. However, the fact remains that the UK’s share of overall exports to Turkey is 1.2%, compared with Italy at 2.4%, France at 1.6% and Spain at 1.9%. If we start to analyse where we have links that go beyond just trade, we can capitalise on that for the benefit of trade. In a Commonwealth country such as India, it is surprising to note that we are being outperformed by the USA—that is perhaps not so surprising—and Argentina, with Germany and France close behind, according to House of Commons statistics.

I have more examples, but the trend I am trying to highlight is that we are now forced to look outside Europe. There is a wealth of opportunity not just in the east, but in the countries that fall within the criteria that I have mentioned. For example, on a recent trip as part of a delegation to Kuwait, I was intrigued to find out that more than 95% of the population is employed in the public sector. The country is about to embark on a large nationalisation programme—[Interruption.] Sorry, a privatisation programme—I stand corrected by the look on the face of the hon. Member for Hartlepool (Mr Wright), who clearly welcomed my mis-statement. However, the UK has unique experience and expertise. Kuwait is embarking on major power plant construction and massive infrastructure development, and our recent links with it should set us apart from many other countries, given that it wants to do business with us, shares a history with us and is open to our companies knocking on its door. That is a place we can look to go to.

How can we do that? The Government have a role to play, as do parliamentarians. What does business actually want from Government? Essentially, businesses faced with the prospect of exporting immediately face a number of barriers, and I experienced them myself. Those barriers will deter even many of the most hardened and determined individuals from reaching into export markets. Although I support the comments of UKTI, we need to be candid and to recognise, as the CBI said in “Winning overseas” in November 2011, that businesses see UKTI as having the Marmite effect: for some, it has been absolutely marvellous, but for many others it has not fulfilled its role or managed to match businesses’ needs with the services provided by the Government. However, that is something that we can improve and build on, and I refer Members to the CBI’s document, which I found extremely constructive and helpful.

From the Government, we are now seeing a commitment to leading trade delegations and opening doors in regions that have been ignored, and the Gulf countries are a good example. However, we cannot do these things through just one visit; we have to maintain a consistent, permanent and ongoing relationship, and I welcome Lord Green’s work, as it is a major start. With all due respect, however, there is a wealth of talent across the Lords and the Commons that should be put to use in helping consistently to develop regions at a lower level. That should be done in a way that carries with it the respect and authority not only of the individual’s heritage, but of the country that is opening its doors to them, as it sees them conscientiously rebuilding relationships.

Let us be candid: when we get to these other countries, we will need to break down the barriers to exports. We as politicians can reduce some of those barriers, such as customs and complicated legislation, in ways others cannot; we can fight our corner and support British companies. We also need to bring in contacts. I would be proud to say that I am a salesman for Britain and that I am opening doors by using the levers at our disposal, as that will allow us to have influence and to bring delegations along, whether from prime contractors or from SMEs riding on the back of prime contractors. We can show companies what they can achieve and give them the contacts.

However, more needs to be done. I welcome Lord Green’s initiative, and our job, in our country and in our constituencies, is to start emphasising the opportunities to export, while explaining how we can offer practical help. I do not want to be the same business man I was 20 years ago. When I first started, I wanted to export to Switzerland, although I will not bore Members with the details. I rang the embassy for advice, and the first thing I was told was, “The markets here are very good for ball bearings.” That still sticks with me as the most useless piece of information that I received, because I could have found it out during my geography O-level all those long years ago. I want to feel that the Government can put in place people who have worked in business and who can actually help businesses to reach out, break down barriers, make contacts and sell. That, crudely, is what it comes down to, and that is how we can help.

I hope the Minister will take on board the fact that the Government are setting the right direction and starting to break down doors, but let us do that consistently and permanently. Relationships are not born out of one visit, but out of a commitment to a region over a period of time. We need patience, and we need to use it to help businesses to meet the cultural and business demands of a variety of regions and to take on markets where we are being beaten, when we should actually be streets ahead.

10:06

[Laura Sandys (South Thanet) (Con)]

I thank my hon. Friend the Member for Macclesfield (David Rutley) for securing this extremely important and prescient debate. In many ways, we will have a challenging time over the next 10 years generating growth domestically in the UK and across the eurozone. Our international trade and inward investment—the responsibility of UKTI—will be crucial in ensuring that we keep ahead of the game and deliver growth for the UK.

My experience is pretty varied. In many ways, I was a very small exporter. I have worked for the Peruvian Government and the Georgian Government, and I had an office in Istanbul. I also did quite a lot of work in Africa and central Asia. I have therefore seen a lot of these issues from the UK, the intrepid traveller and the travelling salesman perspective, arriving in a country and not necessarily knowing who the key players were or how to make things happen.

If we are to support the system, there are probably three big challenges that need to be met by the Government, as well as by large exporters, as my hon. Friend the Member for Enfield North (Nick de Bois) rightly said. One is getting more SMEs to think about exporting. The initiative developed by Lord Green and my hon. Friend the Member for Stourbridge (Margot James), which sees us, as constituency MPs, generating interest in exports, is crucial.

There is, however, something interesting about how we look at exporting, particularly in relation to SMEs. Everybody I speak to says they are going to do an export mission and to take people out to country X, Y or Z. Very few people say that the most important thing for an SME is not going abroad, but having the first sale abroad or the first inquiry from somebody who is quite interested in their product. The internet is a big platform for that. I spoke to UKTI on Monday, and I was a little concerned that it was not looking at helping SMEs to translate one or two of their webpages into two or three different languages. That is very simple; people do not need to get on a plane or to do market testing. SMEs could also put their price list into euros and include export duties for three or four different markets that might be useful for their product. We can do a lot without getting the SMEs to take that leap of faith—to jump on that plane or pay UKTI to organise an event.

The other issue with it, which people, and particularly Government, do not understand about small businesses, is that time is money. If I have to spend three or four days in a market where I do not know anybody and I do not know whether it will be successful and I have three or four customers back in the UK or in Ireland, where will I put my focus? Let us start helping these smaller companies market-test. The internet is a good way. There are brochures and there are different ways of us doing this, but let us not always think that we have to send people out for those initial stages.

[Julian Sturdy (York Outer) (Con)]

My hon. Friend is making a powerful point, but we do have to send people out to these developing countries at certain times. If we are going to capitalise on the BRIC countries and some of the other developing markets that people have talked about, must we not improve our aviation links? If we do not, there is a danger that we will lose out to central Europe on this.

[Laura Sandys]

My hon. Friend has a good point. Of course one has to encourage people to go abroad. One also has to encourage them to understand how these countries work in terms of culture and not just language. Experience in these countries is crucial. My hon. Friend’s point about aviation is well made and has been made particularly in relation to China, where we do not have those links and where we have to go to Europe to access some of those growing markets.

The second point I want to make is about the cultural side. I cannot emphasise it enough: there are 220 languages already spoken in this country. People already have these links. In this country, there are small and medium-sized companies that are run by people who have cousins, relatives, uncles and aunts who have equivalent companies in the countries of their origin. We are not using that. We are trying to expend a lot of money teaching a lot of fantastically able Foreign Office officials lots of different languages, but we already have the languages in this country and we have the business communications. Having been in small business myself, I know that small businesses have a similar language around the world. I would possibly find it easier to talk to a small business in China than a scientist in England. We understand each other; we have the same rhythm. Please, let us use the assets that we have.

The third point, which in many ways has been covered by my hon. Friend the Member for Enfield North, but which is also crucial, is: are we incentivising large exporters to bring their supply chain with them? That is not just on trips, but as part of the overall offering. In many ways, it is a little bit of a waste of our resources when we have big trade missions and we take Rolls-Royce and BAE Systems and all these fantastic companies. They can afford the air fare. They already have operations based in these countries. If they led a trade mission that had their full supply chain and their full level of SMEs and medium-sized manufacturers, I can see why we would be doing it. We have, however, to start focusing on delivering, as the Germans do, in that middle market of entrepreneurs, giving them the confidence, ensuring that we are out there making the business contacts and securing the confidence that those SMEs need, because they are our best advert for recruiting new SMEs.

I welcome what the Government are doing. There is a new emphasis and a new impetus, but let us use the assets that we have and let us get out there and sell and know that selling is a grubby, but very important and worthy business. Sometimes Governments do not necessarily enjoy getting involved at that sharp end.

10:14

[Mr Robert Syms (Poole) (Con)]

First, I welcome the Minister to his post. We look forward to what he has to say later. I congratulate my hon. Friend the Member for Macclesfield (David Rutley) on securing an important debate. We do not talk about these issues enough in this House. It is vital to the future of our country that we get out and sell both manufactured goods and the services that we produce, because that is the only way that we will remain a first-class economy.

Poole, although it is a place with sandy beaches and is pleasant to live in, has a lot of industrial estates and a lot of small companies that are successful. It has a large number of people employed in manufacturing. When I go around, all the companies that are involved in exports seem to be very busy. If the trade figures have not turned yet, I am sure that at some point they will. All the evidence that I see on the ground is that the devaluation and the rebalancing is taking place and will eventually show results.

One of my biggest companies is Sunseeker, which employs nearly 2,000 people. It exports nearly all the yachts that it produces. There are not many people in this country who can afford a £20 million, £30 million or £40 million yacht. It is a great exporter. We have companies such as Siemens, which, although it came in for some criticism recently on the rail contract, is a great British company. It may be German-owned, but it has been in this country for a century and in terms of exports and investment is important to the UK. Siemens in Poole exports to China, the United States and all the way around the world. It produces a lot of the technology for the congestion zone and a lot of signalling technology and it is cutting edge. There is a whole array of businesses.

I want to pick up on a few concerns. There is an equity gap. There are some small successful companies that want to grow and they face a dilemma: they either have to sell, or, if they do not sell and remain owned by their existing directors, they cannot raise the equity or the loans from banks to be able to expand. I have come across a number of companies in Poole that say that they could double or treble their turnover—a lot of it by export—but they cannot raise sufficient funds from the banks. That is the main area where they are being held back. It is not that they cannot sell the products; it is that they cannot raise the capital. That is a big issue.

[Jeremy Lefroy (Stafford) (Con)]

I welcome this debate. Does my hon. Friend agree that the business growth fund—not the regional growth fund—set up by the banks precisely to put equity into such businesses should look at companies that are slightly smaller than the current benchmark? There are plenty of businesses employing 30 or 40 people which could double their employment and vastly increase turnover if they had access to that particular fund, where the limit is currently set a little high.

[Mr Syms]

My hon. Friend makes a good point. We still need to zero in on the small growing companies to see how we can help them with equity and loans.

The other thing is the supply chain. When one hears of a big export order that requires offset, that often means British suppliers down the line losing the ability to supply a big export order. What frustrates many small companies in my constituency is trying to get on the tender list of Rolls-Royce and British Aerospace. I went to see one company that was convinced it had the best product at the best price, but it could not get Rolls-Royce to buy its product. Rolls-Royce bought a German product and that same company beat the German company to supply the Germans with the same product. That was supplying the air tanker project in Germany. It was that frustration. We need a speed-dating process, so that small companies can marry up with British Aerospace and Rolls-Royce, which have been tremendously successful, to see whether we can supply some of these big companies, which are used to getting their supplies from all over the world when there are people in Poole, Macclesfield and, no doubt, Penrith who could produce the goods. There could be a degree of import substitution, simply because we marry up British skills and British companies. That needs to be considered.

The other area I want to touch on, which affects a lot of companies in Poole, where we have communications and quite a lot of military stuff, is the licensing regime for exports. I get a lot of moans from British companies when they have to go through the export licensing process. The difficulty is that it goes into Whitehall and weeks go by. It is difficult when someone is trying to promise the person they are supplying a delivery date for a product and they do not know what is going on. I think that the Government need to go back and look at this. Of course we must have proper safeguards and licences for some of the equipment that we export, but at the moment I am not sure that the system is helping those exporters.

Northey Technologies, a local company in Poole, was supplying the Chinese nuclear programme and had two export orders approved, but the third, for an identical product that they were selling, was held up for three or four months while the Government decided what assurances they needed. I repeat that the third order was identical to the first two, which were approved. Eventually, the Chinese went elsewhere.

The other day I visited AB engineering, another great local company in Poole, which produces robots for defusing bombs—one of two companies in the UK producing those. Of course, because of our experience in Northern Ireland we produce some good robots for doing that. That company exports all the way around the world. I said to the managing director, “You’ve asked me to visit your company. I’m impressed with what you do. Do you have a message for me to take back to the Government?” He said, “Yes, it’s the export licence regime. It’s frustrating. We find it difficult. We can’t find out what’s going on and there are occasions when sometimes we lose exports.”

My main message for the Minister is this: being new to his post, will he please go back and have a look at this area and see whether we can make it a little more efficient? Perhaps we could, at least, have a card system so that people can know when they will get a decision. The most frustrating thing is when people have an order for a good product but find that the Government are not getting on with the process of licensing it when it should be properly licensed. Anecdotally, people think that, since the Arab spring, the Foreign Office has got a lot more involved in exports, which has made things a lot worse.

We have some great British companies and some enterprising people. Going around the world, people will find some Scotsman on top of a mountain trying to sell British products. The reality is, though, that if we could do what we do well a little bit better, we could get better outcomes.

[Several hon. Members]

rose—

[Mr Andrew Turner (in the Chair)]

There is six minutes for each speaker if Lorely Burt takes over.

10:22

[Lorely Burt (Solihull) (LD)]

I will adhere to that, Mr Turner.

I congratulate the hon. Member for Macclesfield (David Rutley) on securing this important debate and my hon. Friend the Minister on his elevation; I am sure that he will make a brilliant Minister.

I think that the need for growth is driving every hon. Member in this Chamber. Growth is the engine that will get us out of the financial difficulties that we were left in when we came into coalition government. I attended a Federation of Small Businesses dinner last night at which our Chancellor was speaking. He talked about the importance of exports and the key role of small businesses in driving exports. Small businesses have a pivotal role to play in leading the recovery, because they are flexible and responsive to changing circumstances and to opportunities which can arise even in difficult times.

I am proud of this coalition Government’s approach to international trade. I am told that no Minister is allowed out of the country without a trade brief in his or her briefcase. It is important to recognise the value of emerging markets, not just our traditional European trading partners: in parts of Europe there are a lot of opportunities, but in other parts it is not so good. Colleagues have mentioned China, India and Brazil, which are important areas that we need to exploit.

UKTI provides a wide range of help and services to business. A number of colleagues have mentioned small business help and the need for more of it. On export credit guarantees, I would much prefer to see the help going to small companies rather than to some of our larger companies—perhaps those that are selling quite a number of arms at the moment. For example, why not extend the supplier credit finance facility to small businesses—the guarantee to a bank for a loan for sums larger than £25,000?

We could do more. The hon. Member for Macclesfield has already mentioned that we do not punch at our weight in respect of exports, compared with other European countries. There are things that we can do. Consider UKTI, for example. The hon. Gentleman talked about getting people out from behind their desks and knocking on the doors of local businesses. I berated the regional development agencies for being far too insular and expecting small business to come to them. The whole emphasis must change. We must be far more outward looking and inclusive.

I was particularly impressed by the hon. Member for South Thanet (Laura Sandys) talking about the internet. It is so obvious, but we do not often talk about that as a mechanism for encouraging and enabling exports, particularly for small businesses.

The hon. Member for Poole (Mr Syms) mentioned speed dating. Why not have business-to-business mentoring? I mean speed dating in the strictly business sense, of course. Perhaps I am just compounding my error. I will change the subject quickly. We can do a lot of things. Our local enterprise partnerships can help as well, as can the chambers of commerce.

Manufacturing is playing and will continue to play a key role in exports and in attracting inward investment, because we have all the tools and abilities in this country. The coalition Government are seeking to rebalance the economy. The west midlands, which is my area, is excellent at high-end, advanced manufacturing. Sadly, manufacturing shrank under the previous Labour Government from 20% to 12% of our gross domestic product. That is shameful.

We have major export opportunities. The hon. Member for Macclesfield mentioned Jaguar Land Rover. Automotive is our No. 1 manufacturing export. Jaguar Land Rover has already expanded its Solihull plant and the i54 plant and it is taking on 1,000 people. There are a great number of things that we can do. We have aerospace, chemicals, agri-food and energy, so it is up to us to have a multifaceted approach to ensure that all of us—Members of Parliament and every facet of Government, as well as employers’ bodies—work together to increase that emphasis and ensure that small businesses, particularly, get their fair share of the pie.

10:28

[Richard Harrington (Watford) (Con)]

I had hoped to be called earlier, Mr Turner, by currying favour with you on the basis that I was at college with you some 35 years ago, but I was disappointed. However, I am delighted to be called now.

I congratulate my hon. Friend the Member for Macclesfield (David Rutley) on securing this interesting debate. I shall keep my comments to two points, because we are short of time.

On the export market generally, on the face of it, our performance is not as bad as it appears. For example, our exports as a percentage of GDP, if invisibles are included, are much the same as France’s and Germany’s. The 2010 figures, according to the Library, show us at 29% of GDP, Italy at 27% and France at 25%. However, those figures are just the surface, beneath which we have a culture in this country, developed over many years, which means that many young people do not even consider going into business, let alone the export sector. There have been other debates, both here and in other parts of the Palace of Westminster, about that culture, and I believe that part of the problem is cultural.

I am sure that if I were to go to the equivalent of a Watfordian sixth form in Germany and ask, “Who wants either to go into their family business or to start up a business?” the number of young people answering, “It’s business for me,” particularly with exports in mind, would be significantly higher than in Britain. Very few of our contemporaries at Oxford, Mr Turner, went into business, and I am sure that very few people nowadays even think about that. At university, people are pushed towards professions and careers such as ours—to which I am a recent recruit, in later life—which, good or bad, certainly do not benefit the economy or assist growth in the rest of the country in the same way as being in a business, particularly an export-led one, does. The issue is very much a cultural one.

One learns to take things as one finds them, and in my travels, both in my constituency and abroad, I have found UKTI to be of almost no help whatsoever to prospective exporters. I will give just one example, because time is limited. A few weeks ago I was asked to go to Mainz, a town in Germany that is twinned with Watford—obviously Watford in many ways is far superior to Mainz, or to anywhere else in the world, but for some reason it is twinned with it. I spoke there at an inward investment conference about investment in Hertfordshire. I was very embarrassed that the UKTI rep in Mainz—which is obviously not in the middle of Africa—did not even speak German. I found that absolutely appalling. When I questioned Lord Green, for example, at a recent Conservative China group breakfast, he could not even say what exports we make to China.

Whatever the Government say, there is no real hardcore business culture in this country as far as exports are concerned. Yes, everyone tries—politicians, the previous Government, this Government. The Foreign Secretary makes speeches saying that we are going to turn the Foreign Office into an organisation that supports business. It is nonsense. On recent visits to five African countries with the International Development Committee, I asked the ambassadors who the main importers into those countries from Britain were, and they did not know. Our ambassador to Burundi, which is a small country with a very small population, said that there was almost no British trade there, and so I had to tell him that one of my constituents, who is also a friend, exported products there. The culture exists in the minds of politicians and some other people, but the reality is very different. People do very well in business in this country without even considering exports. Exporting is not part of the culture. I accept the points that Members have made about the credit and equity gaps, and about financing. That is all well and good, but there is no burning desire to export. The view is it is very difficult, and hard to make money out of—it is just not in our psyche.

There are exceptions. My good friend and fellow Watfordian, Dr Rami Ranger, has a business called Sun Mark Ltd, which exports to 160 countries. Despite all the talk of our lack of efforts in the BRIC countries—Brazil, Russia, India and China—he has recently exported his Bullet energy drink to such countries as Venezuela, Honduras, Belize and Surinam. He is the Burundi man, the Rwanda man—he exports to 160 countries. He has not even heard of UKTI. He does not need to go to seminars held by Lord Green, or anything like that, because he is someone of Indian origin who thinks internationally and is used to driving for business and exports, despite the obstacles put in his way by the 50% tax, national insurance and everything else. He is loyal to this country. He could locate his company anywhere in the world but he has it in Britain, and we need a lot more of that kind of thing.

Our international development efforts are very commendable, and are supported by both sides of the House, but because of tied aid, which used to be something whereby arms were sold from countries that gave aid, there is a fear on the part of the Department for International Development of getting British companies involved in its activities, when there are perfectly benign contracts all over the world for cars, agricultural products and so on—so many worthy things. I am sure that it is against European law to show favouritism to British companies, and it would not be the right thing to do, but there is no mechanism whereby our companies are informed, encouraged and invited to tender. Why do we buy 100 Toyota Land Cruisers in Africa, without even pushing British companies to bid?

Everywhere we go with the International Development Committee—other members of the Committee are here today—we see so much money being spent. I am not saying that we should have favouritism, but there is no real feeling that this is British taxpayers’ money, and we have to try to help British companies, providing the objective is right, that money is not spent where it should not be, and that it is not more expensive. These things have to link together, and that is what I ask the Minister to consider—it is what the Government should be doing. We are proud of our international development efforts, but they should be linked to trade in the nicest possible way.

10:35

[Rory Stewart (Penrith and The Border) (Con)]

I thank my hon. Friend the Member for Macclesfield (David Rutley) for securing this debate.

I want to touch briefly, in a very short time, on the ramping criticism of UKTI and the British Government. The point is, of course, that the situation of British exports is extremely complex. Germany is doing well not because the German diplomatic service is far better than the British one. In fact, the German diplomatic service is in many ways not half as well supported or prestigious within the German administrative system as the British one is. Nevertheless, there are some small things I believe we could do to improve our exports. We do not have a silver bullet. No consul-general in Istanbul will alone be able to double UK trade and investment with Turkey by 2015, but it is important to understand what we can and cannot do with this funny network of embassies.

We first must understand that the business of trade, at least regarding the embassies, is very long term. Britain’s calamitous failure in Brazil is not about a lack of short-term energy from individual British Governments, but about decades of lack of focus. The reason that countries even such as the Netherlands are well ahead of us in their trade with Brazil, and why Germany, France and Italy are doing better than us, goes all the way back to French investment in and support for the first universities in Brazil and German investment in its first industrial plants in the early 20th century. We have already heard about Italian success in Turkey, and that considerable success—Italy is a long way ahead of Britain in trade with Turkey—has been built up over decades, since the first Fiat investments in the 1960s, and it means that there are now 18 flights a day from Milan into Turkey, and an enormous range of small and medium-sized Italian businesses on the ground in a way that our businesses are not. If Britain is now to be serious about that kind of thing, we need to do three things. We need to look at unexpected countries, look at unexpected products, and change the culture of UKTI.

Regarding unexpected countries, a focus on BRIC countries might turn out to be a bit misguided in the long run, and in a sense we have missed the boat, I am afraid, with countries such as Brazil. However, one reason that we cannot become so centred on insulting the Foreign Office and demanding privatisation and a commercial focus is that often our diplomatic missions turn out, in the long run, to be very useful.

Take, for example, Mongolia. There was huge pressure 15 years ago to close our embassy in Mongolia, with people saying, “Why do we bother having an ambassador there? Who cares about Mongolia?” and then the country turned out to have an extraordinary range of assets—natural resources—which are about to make it the country with perhaps the largest gross domestic product per capita in that entire area of Asia. Our diplomatic network, therefore, is partly an investment in low-probability, high-impact events, exactly such as that one. The investment is, as some people have pointed out, less than our investment in the winter fuel allowance, and it pays off again and again through such unexpected opportunities. The same, if I were to be bold, could be extended to a whole series of peculiar countries. The Falkland Islands, if they continue to discover 500 million barrels of oil in the northern reaches, seem set to become a sort of Dubai with penguins.

Those are extraordinary opportunities for us, and we might take them even further. It is not just about second-tier countries such as Indonesia; we should even be looking at countries such as Pakistan. We tend to see Pakistan simply as a failed state, but it is a potential market, within the next generation, of 300 million people with an extraordinary focus on IT. Of course, we also have 1.5 million British people of Pakistani origin who can help us trade there.

Places such as Cumbria show us the astonishing range of unexpected products that we have. Innovia in Wigton, with 1,000 employees, exports 90% of its products. We have Steadmans, designing glittering gold roofs for the Bahrain air show. We have people making forges in Alston winning Queen’s export awards and people selling used photocopiers to China. We sell gluten-free food products into the Balkans.

Let me finish with sheep. The agricultural export market is massively untapped, and that is exactly where an embassy can be useful. The reason that our sheep are not in Saudi Arabia is not that New Zealand is outcompeting us but that we have been denied health certificates throughout the middle eastern market. It is an enormous market. The Arab appetite for sheep is almost unstoppable. Britain is just beginning to go into surplus. Our sheep industry employs 130,000 people. Agricultural exports should be a good example.

The key to all those opportunities in unexpected products and markets is the energy and culture in UKTI, in order to give people the drive and leadership to want to explore those opportunities. We in Britain should look back not at our Victorian past but at our Elizabethan past, when a buccaneering, trading, earring-wearing rogue state took its goods all the way around the world.

10:41

[Mr Iain Wright (Hartlepool) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Turner. This debate is important, and I congratulate the hon. Member for Macclesfield (David Rutley). I have a lot of affection for Macclesfield. My big hero is Ian Curtis of the band Joy Division, who lived, died and is buried in Macclesfield. I also congratulate the Minister on his new position. I wish him well in his role. Given the turnover of Liberal Democrat Ministers, I am confident that he will be Secretary of State by Christmas.

Today’s debate has shown that there are huge opportunities for British export, but that we do not tap into our full potential. The world’s economy is expected to double in size by 2050. Much of this debate has focused on BRIC countries. There is some scope to expand our opportunities into BRIC countries, especially as China moves from an export-led production and manufacturing model towards internal domestic consumption, but I think that the second tier—the N11 or next 11 countries such as Indonesia, Turkey, South Korea, Nigeria and Vietnam—are exactly where we need to focus. I agree with the hon. Member for Penrith and The Border (Rory Stewart) that we have often missed the boat. We need to be at the forefront of trade with N11 countries.

The UK has world-class sectors. Our automotive sector, which has been mentioned, contributes about £40 billion of turnover, and 80% of its production is exported. The oil and gas sector, which is strong in my area, exports about £32 billion of goods, services and project management skills. Just this morning, I was at a breakfast meeting with ADS. The UK aerospace, defence and security sector exports about 70% of its output, or about £23 billion of products. The quality, reliability and innovation of those products are seen throughout the world, and we should be proud of them.

However, this is not just about traditional manufacturing sectors. The UK video games and interactive entertainment sector is worth £3 billion to the national economy at the moment, and global demand is expected to rise by about 10% year on year. We lead the world in that sector. “Batman: Arkham City”, produced by Rocksteady Studios in north London, sold 2 million copies in its first week of release. No CD or record—not even by Joy Division—has ever achieved that. We should be exploiting it as much as possible.

We have much to be proud of, but we cannot be complacent in this modern, competitive world. We cannot say that our exports have performed to their full potential in the post-war era. Given the intense competition of this arms race—I do not think that that is too strong a term, considering the issue’s importance and intensity—Britain needs to compete with optimum efficiency.

I agree with the CBI when it says:

“We are not alone in seeking growth through exports—other advanced economies are facing similar constraints and are looking to boost their export performance. We cannot spend another decade simply playing catch-up: we need to be bigger and bolder in our ambitions.”

The CBI concludes:

“We are not being ambitious enough with our choice of markets and our decline in goods exports is unsustainable if we want to lead an export-orientated economic recovery.”

It has been mentioned that the UK is far too dependent on traditional, slow-growing economies. Some two-thirds of all UK exports go to the US and the EU, but in the next decade, those markets will probably not grow at all. There has been much talk of balancing the economy. I hope that the House would agree that it is necessary to rebalance trade policy towards new and emerging companies.

I stress that exports and trade policy do not operate in a domestic or an international vacuum. We cannot consider exports and trade performance in isolation from the rest of Government policy. I urge the Government to implement an active, co-ordinated industrial strategy. I fear that we are a long way from that at the moment, but everything that the Government do must be considered in terms of its impact on our trade performance.

The Government’s economic policy is having an effect on business confidence and growth. The business confidence index published this week shows that confidence in negative territory. By all accounts, we are back in official recession. Turnover is depressed, there are no export growth areas and exports are not bouncing to take up the slack left by subdued domestic demand. I hope that the Government will address that.

[David Mowat]

The shadow Minister is discussing the present lack of industrial policy. In the decade between 2000 and 2010, we went from being the fifth biggest exporter in the world to being the 13th, way behind countries such as Italy. In his judgment, why did that happen?

[Mr Wright]

That is a consequence of the world growing in different ways and a symptom of the long-term decline in our export performance. As I said, we need to make a concerted effort to do something about it. Many of the invisibles kept up well during that decade and levels stayed similar. However, the thrust of my argument is that we need to raise our game.

Every Minister—not just Business Ministers—and every aspect of Whitehall should be charged with promoting British exports, but all too often, policies are not joined up. The immigration cap indicates that Britain does not want to act as a beacon for the world’s best and brightest, and there is a perception among foreign businesses that it will act as a brake on export growth.

Aviation policy was mentioned. A recent report suggests that a lack of direct flights from the UK to emerging markets might be costing our economy £1.2 billion a year in lost trade. Firms naturally trade where there are good and co-ordinated transport links. In my area of the north-east, the Emirates service between Newcastle and Dubai has tripled trade between the two areas in the four years since it started. The hon. Member for Macclesfield mentioned Chengdu. There are no direct flights from the UK to Chengdu, but there should be. British Airways does not run a service from the UK to Seoul in South Korea, although I admit that other carriers do. The Government should work closely with airlines to address that.

I turn to last week’s disappointing announcement that the Indian Government might place an order for fighter jets with French manufacturer Dassault, rather than with Eurofighter Typhoon, in which the British BAE Systems plays a huge part. The Prime Minister paid a lot of political capital with regard to that. The Opposition do not want to do anything to compromise the deal. We will support the Government in ensuring that Britain can be successful, and we think that there is still considerable scope to succeed, but I hope that lessons are being learned within the Government. Frankly, as has been touched on in this debate, the Prime Minister jetting off for a one-off PR stunt is no substitute for deep and meaningful Government-to-Government relations.

The French are particularly adept at this, and President Sarkozy’s courting over many months of Prime Minister Singh seems to have reaped rewards. Will the Minister outline the steps that are being taken to ensure that the Eurofighter stays in the game? On a wider point, what will the Government do differently to ensure more meaningful and therefore more successful contact to secure trade for Britain?

On UK Trade & Investment, I do not want to focus on cuts, but the context is important. UKTI’s budget over the next four years has been cut by 17%. In contrast, Ubifrance’s budget saw an increase of 14.2% in 2011, while that of Germany Trade & Invest increased by 10%. The Minister, fresh with his red box, will no doubt spout the lines that tough choices need to be made and that austerity is required to clean up the mess that we left behind, but does he really believe that reductions to this country’s foreign trade organisation, at a time of acute global competitiveness and when our main competitors are increasing their budgets, are sensible and will not hurt Britain’s export drive?

In the time remaining to me, I want to touch briefly on one of the key barriers to trade, particularly for small and medium-sized enterprises, namely access to finance. Will the Minister update us on progress made on the actions outlined in the plan for growth, which was published almost a year ago? How many SMEs have been helped as part of the UKTI’s passport to export initiative? How many firms have taken advantage of the export enterprise finance guarantee? The plan for growth produced three new products designed to mitigate the risks for exporters and potential exporters. How many have taken that up?

Britain has a long history of trade across the globe over many centuries. I liked what the hon. Member for Penrith and The Border (Rory Stewart) said about the need to look not to our Victorian past, but to think further back to our buccaneering in Elizabethan times. We need to address the intense competition. I would hate to see our successors in 50 years’ time lamenting the failed and missed opportunities of the first half of the 21st century in relation to the expanding global economy. The Minister is fresh in office and could make his mark by ensuring a competitive and co-ordinated policy across the Government and with business, so that we can sell British goods and services across the world, thereby creating jobs and wealth for this country.

10:52

[The Parliamentary Under-Secretary of State for Business, Innovation and Skills (Norman Lamb)]

I thank hon. Members for their kind good wishes, including the encouraging words from my own constituent—it was a relief to hear them—quoted by the hon. Member for Enfield North (Nick de Bois). I congratulate the hon. Member for Macclesfield (David Rutley) on securing this important debate. He made some incredibly important points and focused in particular on the role of small and medium-sized enterprises. It is critical to address how we can get more SMEs exporting, and I will return to that point in a moment.

We have heard about a large number of success stories and we need to go out and argue the case for what is already happening among many companies in our constituencies. Many Members have also highlighted barriers that need to be challenged and tackled. The hon. Member for Watford (Richard Harrington) focused on cultural barriers. We have to encourage our youngsters to think about becoming entrepreneurs and exporters. That needs to be seen as a good thing to do. The hon. Member for Penrith and The Border (Rory Stewart) is correct that long-term investments need to be made to win new markets. We have strong cultural links with many countries. As the hon. Member for South Thanet (Laura Sandys) has said, 220 languages are spoken in this country and they link people to their countries of origin. We need to exploit those links to our advantage, and I think that they are there to be taken.

This debate is timely—tomorrow is the first anniversary of the trade and investment for growth White Paper. Published early in the Government’s tenure, the White Paper made clear the importance of rebalancing our economy. Growth over the past decade was based too much on debt and consumption, and we need to refocus on export. If we are to rebuild our economy, exports are critical, and I think that there is agreement throughout the House on that. My hon. Friend the Member for Solihull (Lorely Burt) made the essential point that the need to rebalance our economy, build sustainable growth and create jobs through international trade and investment must be a priority for us all.

We are a trading nation with a rich heritage to which many hon. Members have referred. We have looked outwards, but in recent years there has been a sense of complacency about our role in the world—it is almost as though we have had a sense of entitlement. We need to challenge that, be hungry and show the buccaneering spirit that has been mentioned. We need to position ourselves to take advantage of the new opportunities for growth, particularly in respect of the non-traditional trading partners. We need to work with renewed energy to ensure that all parts of our economy are working together to get the message across that Britain is open for business. The global economy is highly dynamic and very competitive. We need to be more energetic to win new business.

In response to the points that have been made, I want to focus on three key issues. First, how can we get more companies, especially SMEs, to export? Secondly, I want to outline some of what the Government are doing to help ease the flow of export credit to exporters. Finally, I want to say something about what the Government are doing to help more British companies into the fast-growing markets of the east and the south.

Many hon. Members have focused on the first priority. A vital part of increasing exports is to get more companies exporting. My colleague the Minister for Trade and Investment, Lord Green of Hurstpierpoint, has set out an ambitious programme for increasing the number of SMEs that export. As I think the hon. Member for Macclesfield has mentioned, only 20% to 23% currently export, compared with the European average of about 25%, and the figure is higher in Germany. We need to get an extra 100,000 SMEs exporting over the next four years to reach the European average. That is a bold, ambitious, but achievable goal, and one on which we must focus.

Achieving that increase in the number of exporters is not something that the Government, through UK Trade & Investment and UK Export Finance, can do alone. Last November, at the IMAX at Waterloo, the Prime Minister launched the national export challenge. This major partnering event brought together all those organisations and trusted advisers that can reach out to companies with messages about trade and exports.

The banks face a big challenge. They have the contacts with businesses, but a recent poll showed that many small manufacturers do not feel that they are getting the support that they need from their banks. Banks and other organisations need to reach into the business community that provides a direct route to the decision makers who really matter—the directors and managers who live day by day with decisions about how to maintain and build their competitiveness.

Lord Green is also overseeing changes to UKTI, about which there have been many comments. The changes are bringing in private sector expertise, which has been mentioned, to strengthen UKTI’s leadership, and outsourcing services to private sector deliverers. That, coupled with an extra £45 million secured by UKTI in the autumn statement, has set it on a course to double the number of companies that it helps from 25,000 to 50,000. Lord Green has also overseen the launch of new packages of export credit finance from UK Export Finance that now meet the specific financing needs of SMEs.

Companies that start to export show increases in productivity. They are exposed to new ideas and better use of resources. Their competitiveness and business sustainability also improve. UKTI and UK Export Finance can help those companies with advice and support, but the Government recognise that other partners and intermediaries have a crucial role to play.

Following on from November’s launch of the national export challenge, UKTI and UK Export Finance have held a series of seminars around the English regions. The most recent was in Yorkshire and Humberside on Monday this week. I encourage all Members—this point has been made; there is an enormous amount of expertise in and experience of business in the House—to get involved in such events and encourage businesses in their communities to think about the export opportunities that are available.

As Lord Green has said on many occasions, to reverse the decline in the UK’s trade balance is a marathon, not a sprint. We now have in place the ground work on which to build, including the active engagement of UKTI and UK Export Finance with support networks, and the targeted support of SMEs at trade fairs and on missions overseas.

[Mr Andrew Turner (in the Chair)]

Order. It is time for the next debate.

Broadcasting of Court Proceedings

Wednesday 8th February 2012 Westminster Hall

11:00

[Mr John Whittingdale (Maldon) (Con)]

I am pleased to have the opportunity to hold a short debate on the subject of the broadcasting of court proceedings. I should perhaps make it clear at the start that I am not a lawyer. I have appeared in court, but only in the jury box—never as counsel and not yet in the dock.

However, during the past few months, both in my capacity as Chair of the Select Committee on Culture, Media and Sport and as Chair of the Joint Committee on Privacy and Injunctions, I have had dealings with many lawyers. In respect of the Joint Committee on Privacy and Injunctions, I read the report of the committee on super-injunctions recently prepared by the Master of the Rolls. I want to quote the opening section, in which the Master of the Rolls states:

“It has been a fundamental principle of the common law since its origins that justice is conducted, and judgments are given, in public.”

He then goes on to quote the Lord Chief Justice, who said only last year:

“Justice must be done between the parties. The public must be able to enter any court to see that justice is being done in that court, by a tribunal conscientiously doing its best to do justice according to law…In reality very few citizens can scrutinise the judicial process: that scrutiny is performed by the media, whether newspapers or television, acting on behalf of the body of citizens. Without the commitment of an independent media the operation of the principle of open justice would be irremediably diminished.”

I could almost end there, but I want to go on to say a bit about the background to the matter.

The ban on television cameras stems from a section of the Criminal Justice Act 1925, which I understand was passed to prevent the distraction caused by exploding flash bulbs of cameras in court. Of course, at that time television had not even been invented. Since then, there has been a long debate about whether our courts should be opened up to allow greater access to the media.

The debate about television cameras has been going on for more than 20 years. In 1989, Jonathan Caplan on behalf of the Bar Council produced a report that came out broadly in favour of allowing television, subject to certain very strict controls. Nothing then happened until 2004 when, after discussions between the Department for Constitutional Affairs and the broadcasters, it was agreed that a pilot scheme would be allowed to operate for a few weeks in the Lord Chief Justice’s court and then in the Master of the Rolls’s court.

That pilot scheme was never broadcast, but it demonstrated that the televising of court proceedings could be done without causing great distraction or disruption, or creating the dangers that people had spoken about. The broadcasting of proceedings could be done very discreetly and, most importantly, it could be completely controlled by the judge. During the pilot scheme, on a couple of occasions the judge pressed the button he had to shut off broadcasting. A large number of people have seen the results of that pilot and, as far as I am aware, it is generally regarded as a success. The pilot scheme did not lead to any great concerns being expressed and most people felt that it was a step forward both in allowing people to see the workings of the court and increasing understanding of the judicial procedure.

Although the pilot scheme was generally deemed to have been successful, nothing then happened. However, there have been one or two developments outside the English and Welsh court system. For instance, the Scottish courts have allowed very controlled broadcasting, but because anybody can object, it has not been used very much. When the Supreme Court was established, it allowed some televising of its judgments. Despite the fact that those are largely fairly detailed legalistic debates, I understand that the streamed feed from the Supreme Court made available by Sky has had a lot of viewers. Indeed, there have been around 50,000 this year, with 14,000 recently watching the ruling on the Assange case.

There have been other judicial procedures during which television cameras have been allowed, such as the Chilcot inquiry, the Hutton inquiry and, of course, most recently the inquiry carried out by Lord Justice Leveson. Given the fact that I am involved in considering similar material, I have been watching the proceedings of Lord Justice Leveson’s inquiry with great attention. Those proceedings have been carried in considerable part on both the Sky News channel and the BBC News channel. There are also plenty of examples in other countries. In fact, Britain is one of very few countries left that does not allow any televising of its judicial proceedings. Most comparable countries in the developed world allow broadcasting; indeed, even China and Russia allow broadcasting of their court proceedings.

So if the arguments are so strong, why has it not happened? There have been objections. A long-standing objection is that broadcasting proceedings might lead to grandstanding and that people will play to the cameras and want to become celebrities in their own right. I was not a Member when television cameras were introduced in the House of Commons, but I was active in politics and I remember precisely the same arguments being made then about what would happen with MPs’ behaviour and that they would similarly perform to the cameras. In large part, that has not occurred. Indeed, I think most people regard the broadcasting of Parliament as having been a great success.

There have also been objections that somehow the media might distort coverage, presenting a slanted view, and that there will be a loss of objectivity. Of course, any televising of court proceedings would be subject to the same restrictions on court reporting that exist at the moment for other forms of media—for example, not revealing the identity of jurors or of potential rape victims. Those rules would apply equally to television cameras as they do to newspapers. One has to say that in general—not just in terms of the coverage of judicial proceedings—television has a better record than newspapers for impartiality and objectivity because it is governed by strict rules requiring it to be impartial and objective.

I shall illustrate a recent case where the televising of proceedings certainly had a beneficial effect for me. I had read a great many fairly lurid accounts, particularly in the tabloids, of the Amanda Knox case and the murder in Italy. Many people felt such reports were not entirely objective and, indeed, that they suggested very strongly that Amanda Knox was guilty. I happened to be away at the time of the appeal hearing in the Italian courts, which was carried in large part on Sky News, and I watched much of the proceedings, including the broadcast of Amanda Knox appearing in the witness box. At the end of the proceedings, I had considerably more doubt about the case. Therefore, when the court delivered its verdict that she should be released and was not guilty, it came as less of a surprise than it would have done to those people who had only read about the case in the tabloid press. That is an area where broadcasting can increase understanding and serve justice well.

It is easy to think of cases that will obviously be attractive to the broadcasters. Such cases will not only be sensational, lurid murder trials, although I have no doubt that some of those will be broadcast. I shall give three recent examples where there would have been real merit in having broadcast coverage. The first—this is a painful subject for all of us in this place—is that of the recent trials of MPs for abuse of their expenses. There was a huge public interest in people who were paid from the public purse, and it was very important that it was shown that nobody should be above the law. If those trials had been broadcast, they would have received a lot of interest and coverage.

Secondly, there were the riots, and the cases involving those who were convicted of rioting last summer. Again, there was a very big public interest. There was, perhaps, a lack of understanding about some of the sentencing policy. If people had had the opportunity to see the judge deliver a sentence and explain why he had reached that decision, that would also have increased understanding.

Thirdly and most recently, there was the Stephen Lawrence case. The fact that justice was finally done received huge coverage in the newspapers. It would have been even more powerful if the case had been broadcast and people had had the opportunity to see justice finally being done.

I was therefore extremely pleased to hear the announcement by the Lord Chancellor last September that the Government intend to move towards allowing the televising of court proceedings. Of course, there should be a step-by-step approach.

[Mr Andrew Smith (Oxford East) (Lab)]

I congratulate the hon. Gentleman on securing this important debate. I agree with the thrust of his argument. It is important that justice is not only done, but, as he says, seen to be done.

On the step-by-step approach, does he agree with the points made by the Master of the Rolls in his speech to the Judicial Studies Board on 16 March 2011? He asked,

“from a public interest perspective might there not be an argument now for its hearings”—

that is, the Supreme Court—

“and some hearings of the Court of Appeal, being televised on some equivalent of the Parliament Channel, or via the BBC iPlayer.”

Broadcasting court proceedings could start there. We could then see how that goes, and extend it later.

[Mr Whittingdale]

I agree entirely with the right hon. Gentleman. The pilot scheme started in the Court of Appeal. In their review of the pilot scheme, the broadcasters said that they would have liked it to have gone further, and that it should have been allowed to cover Crown court proceedings, and perhaps to have shown witnesses as well as the counsel and judge. That needs to be done in a step-by-step way. There are genuine concerns and to allay them, we need to proceed gradually. I hope that in due course we will have much greater access, but let us start, as the right hon. Gentleman and the Master of the Rolls say, with the Court of Appeal. That would be a major step forward and is, I think, what the Government hope to do.

The obstacle is the requirement for primary legislation. There is no doubt that it will take time for the rules to be worked out, and secondary legislation will probably be needed to set out in detail how this will work. However, none of that can begin to happen until there is primary legislation. The broadcasters—in a letter that was sent this week by the head of BBC news, the chief executive of ITN and the head of Sky news: a joint letter from all three of the main news broadcasters in this country—have stated that they are very keen for the process to get under way, but that primary legislation would be required in the Queen’s Speech. My request and plea to the Minister this morning is not just to confirm the Government’s intention to move gradually and carefully down this road, but to do so at the first opportunity—the Queen’s Speech.

In conclusion, this is a reform whose time has not just come, but is long overdue. I hope the Minister agrees and is able to provide us with more details this morning.

11:13

[The Parliamentary Under-Secretary of State for Justice (Mr Jonathan Djanogly)]

I congratulate my hon. Friend the Member for Maldon (Mr Whittingdale), who is the Chair of the Culture, Media and Sport Committee, on securing this timely debate. In an impressive and knowledgeable speech, he presented a view that is fairly close to that of the Government.

Open justice is a long-standing and fundamental principle of our legal system. Justice must be done as much as it must be seen to be done if it is to command public confidence. As my hon. Friend set out, the Master of the Rolls said last year:

“Public scrutiny of the courts is an essential means by which we ensure that judges do justice according to law, and thereby secure public confidence”.

Very few people have direct experience of court proceedings. In principle, our courts are open to all members of the public who wish to attend, but in practice very few people have the time or opportunity to observe what happens in our courts in person. For many, the criminal justice system is still seen as opaque, remote and difficult to understand. We need to make it a reality that our courts are open and accessible to as many people as are interested in seeing them work.

Media coverage is often the prime source for public understanding of the criminal justice system, and many people base their views of the courts on their portrayal on television or film. Those dramatised accounts inevitably do not give an entirely accurate portrayal of what happens in a court case. The Government and the judiciary are committed to improving the public’s understanding of the criminal justice system through increasing transparency. The more informed people are about the justice system, the more confidence they will have in it.

Our evidence shows that a key element of confidence in the criminal justice system is how fair the public believe it is. People want information that has not been spun about what happens to criminals and why. The majority of respondents to the Department for Constitutional Affairs consultation on broadcasting in courts in 2004 believed that broadcasting could increase understanding of court processes and make courts more accessible. That is why the Government believe that removing the current ban on filming in courts will improve public understanding of the justice system.

The Lord Chancellor and Secretary of State for Justice announced last year that the Government plan to allow judgments and sentencing decisions in cases before the Court of Appeal, in both the criminal and civil divisions, to be broadcast. We intend to introduce legislation to give effect to those reforms as soon as parliamentary time allows, although I cannot, as I am sure my hon. Friend the Member for Maldon appreciates, pre-empt the Queen’s Speech. We are working very closely with the judiciary to take that work forward.

My hon. Friend made a case for the eventual full recording of all trials. That is not being reviewed at the moment, although I appreciate that he understands that a step-by-step approach, which was how he put it, will be required. Over a longer period, we expect to extend broadcasting of sentencing remarks to the Crown court, given a reasonable time after the introduction of broadcasting in the Court of Appeal.

All hon. Members will remember the media furore over the O. J. Simpson trial in the United States of America, and, more recently, the trial of Michael Jackson’s doctor. My hon. Friend mentioned selected excerpts from the Knox case. The Government and the judiciary will not permit our courts to become show trials for media entertainment. We therefore have no current plans to allow the broadcasting of trials from the Crown courts, other than sentencing remarks.

Currently, the Criminal Justice Act 1925 prohibits anyone taking, or attempting to take, a photograph in any court except the Supreme Court. Furthermore, the Contempt of Court Act 1981 prohibits the use of a tape recorder, or other device, to record the audio of the court proceedings. Primary legislation, as my hon. Friend made clear, will be required to amend that legislation, and any proposals the Government bring forward will be subject to proper parliamentary scrutiny and debate.

With certain limited exceptions, most courts are open to the public, and journalists are allowed to be present in court and report what they see and hear, subject to reporting restrictions. At the end of last year, the Lord Chief Justice published new guidance for journalists wishing to use live text-based communications, including Twitter from mobile phones, in courtrooms during the conduct of a court case. Journalists and legal commentators no longer need to apply to use text-based devices to communicate from a court during a case, although the presiding judge always retains full discretion to prohibit such communications in the interests of justice.

Broadcasting of court proceedings is not without precedent in this country, as my hon. Friend made clear. We already allow broadcasting of live footage of the UK Supreme Court, and many people watched Julian Assange’s appeal to the Supreme Court last week. All hearings in the Supreme Court can be viewed online from anywhere around the world through the live stream on Sky’s website. Figures from the first three months of broadcasting from last summer show that that stream was seen 139,000 times, proving there is a public appetite for watching court proceedings. Limited televised excerpts from inquiries—my hon. Friend mentioned the Hutton and Leveson inquiries—have been broadcast, and have engaged the public as they have progressed.

We must remember, however, that the courts deal with very serious matters that can affect the liberty, livelihood and reputation of the parties involved. It will be vital that proper safeguards are introduced to ensure that the parties are treated fairly, and that their rights are respected. Our paramount concern in opening up our courts to broadcasting must remain the proper administration of justice.

We are very clear that television must not give offenders opportunities for theatrical public display. Offenders will not be allowed to be filmed, and we are clear that the judge will have the right to stop filming in the event of any demonstration or disruption in the courtroom. We will also not allow victims, witnesses or jurors to be filmed. Victims and witnesses will be protected, and we will not introduce any measures that would make their court experience even more difficult or make them even more reluctant to give evidence. We are seeking the views of victims’ groups on our proposals, and potential safeguards to ensure that the identities and rights of victims, witnesses and jurors are protected.

[Mr Whittingdale]

I accept, of course, that this will be a step-by-step process, but I hope that the Minister will not close his mind completely to the suggestion that eventually witnesses should be allowed to be televised. I know that it is not the same, but I chair televised hearings, one or two of which have achieved quite large audiences. I know that appearing before a Select Committee may be intimidating, but I do not think that it makes a great deal of difference if it is broadcast. The fact that witnesses are appearing in a parliamentary forum may be intimidating, as it might be in a court, but the cameras are very discreet, and people are largely unaware of them.

[Mr Djanogly]

Such an inquiry may be similar to a criminal trial, but often it is not. The circumstances and sensitivities may be different, as may the outcome.

Existing reporting restrictions on cases will continue to apply to broadcasting, and in all cases the judge will have the final say on whether proceedings should be broadcast. We are considering how to ensure that any use of the footage is appropriate to the dignity of the courts as part of the legislative framework. This will not happen overnight. The 2004 pilot of filming in the Court of Appeal, which was not for broadcast, demonstrated that it is possible for cameras to be allowed into courts without disrupting the administration of justice. However, before any plans can be agreed, we must take into account the views of a wide range of interests, and we will have discussions with the judiciary and others to ensure that we have considered the complex legal, practical and technical issues.

Allowing the broadcasting of judgments and sentencing remarks is one of a number of measures intended to open up the court process to the public, including to those who do not have the occasion or opportunity to attend court in person. The Government are committed to providing the public with information on the operation of public services in their area, and the justice system is no exception. We are taking significant steps to open up the courts to the public, and to get as much information as possible about their performance at local level into the public domain.

On 24 November last year, we published anonymised, individual-level sentencing data by court so that the public can see what sentences are being handed down in their local courts, and can compare different courts on a wide range of measures, such as timeliness. At the beginning of this year, on 12 January, we published performance data for individual courts that enable local communities to find out how their local court is performing on a range of measures. The data include, among other measures, information on case timeliness in criminal, civil and family courts, and the proportion of cracked and ineffective trials at the Crown court. That represents a significant step forward in keeping the public informed about how the courts are operating in their area. In May, we will go a step further and provide justice outcome information on police.uk. That will enable the public to see what happens after a crime is reported—police actions followed by justice outcomes—and will reinforce the link between crimes being committed and justice being delivered.

In addition to the new data we have published on court performance, the Government have taken other steps to provide the public with information on how the criminal justice system works. For example, our release on court-level sentencing data in October 2010 was made available in a user-friendly format on the “Making sense of criminal justice” microsite, and was significantly more popular than normal statistical releases. Crucially, the data were released alongside the award-winning “You be the Judge” tool, which aims to promote public understanding of the sentencing process. The Government believe that providing adequate contextual information to increase public understanding of the criminal justice system is key to making data meaningful to the public, and we plan to provide such information with every transparency-data release.

I believe that the crime and justice sector is at the vanguard of transparency across Whitehall, and good progress has been made to date. However, we are committed to making the justice system more transparent, and I am confident that we will continue to make good progress in this area. The Government believe that television has a key role to play in increasing public confidence, and that is why we plan to introduce broadcasting from courts. However, although it is important for justice to be seen to be done, it is more important that justice is done. The administration of justice remains our primary aim, and our proposals to permit broadcasting from courts will not be allowed to affect that in any way.

11:25

Sitting suspended.

Rural Schools

Wednesday 8th February 2012 Westminster Hall

[Mr Mike Weir in the Chair]

14:30

[Mr Jamie Reed (Copeland) (Lab)]

Today is not the first time that we in this House have discussed the future of small rural schools and I do not believe that it will be the last. I have to make it clear—this view will be shared by colleagues—that I am not interested in listening to any redundant polemic. Instead, I want to illustrate the plight of small rural schools, particularly the crisis facing Captain Shaw’s Church of England school in the village of Bootle in my constituency, and suggest some potential policy solutions for small rural schools, which I hope that the Government will be minded to support. The Minister will state that such decisions are for local education authorities and he would be right in part to identify that accountability, but I hope that pressure can and will be brought to bear by him and his Department, not only on this policy area, but on Cumbria county council with regard to its treatment thus far of Captain Shaw’s school and the community of Bootle.

My constituency of Copeland is the English constituency most remote from Westminster. Whether by plane, train or car, it is a minimum journey of six hours from Whitehaven, the constituency’s largest town, to Westminster. As the Minister knows, Copeland sits within Cumbria, the second largest county in the country, with a population just below 500,000 people, 50% of whom live in rural communities. This poses unique policy challenges in every area, from health to economic development, and many of those require unique local solutions, which a Government of any colour are required to get behind. However, none of that removes the Government’s obligations to the people of Cumbria and, in this instance, the people of Bootle.

I am delighted to hear that the Minister was in Cumbria this week. I hope it is not the last time that we see him there.

Bootle is an outstanding community. Situated within the Lake District national park, it is a truly beautiful place. The village—I use that word despite some residents telling me that it was essentially given town status by Edward III with the granting of a market charter in 1348—is an incredibly beautiful place that was described by the renowned writer and social campaigner, Doreen Wallace, in her landmark book, “English Lakeland”. She stated:

“To see Bootle is to love it.”

She was right, but Bootle has seen huge change in recent decades. Its employment base has been threatened and it has faced the same challenges faced by other rural areas throughout the country, but these have been amplified given the unique nature of Cumbria and Copeland.

Right now, Captain Shaw’s school is the centre of Bootle: it is its beating heart, its focal point and, in many ways, its pride. If Captain Shaw’s school is taken away from Bootle, the consequences will be profound. Not only will the village suffer a huge blow in terms of status and civic pride, but the message given to the pupils at that school will be one that is frankly cruel, even brutal. The message is, “We don’t back you, we don’t believe in you, we don’t share your aspirations, we don’t understand your ambitions; you are on your own.” I cannot accept that, the people of Bootle cannot accept that and the children should not be subjected to the psychological impact of that.

The reality is—I will touch on this issue again later—that we see the ambitions, aspirations, qualities and hopes of our communities in our schools. I have visited Captain Shaw’s on a number of occasions. It is a unique school: the smallest school in the country’s second largest county, in the furthermost English constituency from Westminster. It currently has a roll of 16 pupils from 4 to 11 years old. Every time I have visited the school I have been impressed by it. There is a genuine warmth and passion about the school and the pupils demonstrate a tremendous sense of pride and belonging. The building that they occupy is more than 180 years old, yet it is in very good repair inside and out. It has excellent ICT facilities. It is modern on the inside and has a good play area outside.

The school, as I have mentioned, mirrors the community. It is doing more than simply getting by. It is handsome, notable and unique. It is supported by an indomitable community spirit and is proud of its past and ready to take on the challenges of the modern world. I could wax lyrical about the school for a long time, but the independent Ofsted evaluation puts it even better than I ever could.

In the latest Ofsted report, Captain Shaw’s school is rated as a good school. In fact, the inspector noted that,

“this is a good school which has an excellent ethos of care, guidance and support. It is a highly valued member of its local community, with which there are excellent links benefiting pupils. On leaving Captain Shaw’s, pupils are confident, independent and self-assured young people. They possess excellent social skills which contribute to their outstanding behaviour and positive attitudes to others”.

The report is glowing in other areas too, rating the school as outstanding in the effectiveness of its care, guidance and support for pupils, but it is in lead inspector, David Byrne’s, letter to pupils and parents after his inspection that the true nature of Captain Shaw’s school and its place within the Bootle community is revealed. He wrote:

“Your school is quite special. It is very much at the heart of your village and local area and makes a vital contribution to the lives of many, not just those learning or working in the school.”

I really could not put it any better than that.

Despite the school’s small roll, it is viable. Development plans are already under way, supported by the national park, to develop Bootle sympathetically with new housing, including some affordable housing, which would make the school even more viable. In addition, the pupil-teacher ratio at the school is very good indeed, at a level that many people around the country would choose to pay for in an independent school. I do not hold independent schools in higher or worse esteem than our other schools, but it is perverse that anyone would seek to remove from a community such as Bootle the kind of provision that would be valued, privately paid for and even envied in other parts of the country. This really is the worst kind of policy-making myopia. With that in mind, it is entirely relevant to mention that the decision to close Captain Shaw’s school has been taken by a county council that is headquartered 62 miles and a one and a half hour drive away from the community in question.

Before issuing its closure notice, Cumbria county council undertook a consultation on what it called

“proposed changes”.

I have a tremendous amount of respect for Julia Morrison, Cumbria county council’s director of children’s services, who has begun to make a real difference in Cumbria since her recent arrival, but I think I speak for everyone in Bootle when I state that nobody believed that this consultation was ever going to result in anything other than the closure of Captain Shaw’s.

I speak as a former press officer for Cumbria local education authority. There have been a number of attempts to close Captain Shaw’s over the years, none of which has ever been successful because the case for closure—I have seen this from the inside—could never be made.

My first request to the Minister is as follows. The Government have a presumption against the closure of rural schools and have stated that they want to protect them. I share that ambition. Captain Shaw’s is strong and viable and I call upon the Minister to put this policy into effect and intervene in this instance. Even in its closure consultation, Cumbria county council recognised that the number of pupils at Captain Shaw’s is likely to rise and euphemistically acknowledges that

“village life would clearly not be enhanced by its closure”.

Small rural schools can be outstanding. The outstanding St Bridget’s school in Parton, also in my constituency, is proof of that, as are many others. I pay tribute to the work done at St Bridget’s and, in fact, to everything that that school does, not just for its pupils and their parents and some pupils’ carers, but for the village of Parton as well. Once again, the case is made that schools like this are the key to the success of the communities that they are based in.

In one of its final reports, the Commission for Rural Communities published “Small school: Big Communities —Village schools and extended services”, which I commend to hon. Members, including the Minister. The report focuses upon extended provision as a key policy solution with which to help sustain rural schools. It is right to do so. It also mentions that extended services help to break the link between poverty and poor educational outcomes.

The report states that rural poverty is often hidden. I should like to dwell upon that for a moment, because despite its obvious beauty and despite some obvious individual affluence, Bootle is not a rich village. Poverty exists in parts of Bootle and is magnified by its rurality and peripherality.

I am sick and tired of redundant notions of rurality running riot across the House, in all political parties. In the mind’s eye, some in the House see rural areas as occupied by corpulent farmers chewing blades of grass and leaning on gates and, moreover, as simply a playground for those who have wealth and who have left urban areas to gentrify the countryside with large homes and Range Rovers. They never see the young farmer struggling to stay afloat and they rarely consider what it means for people who have no access to public transport and, as a result, to the schools, hospitals and other services that their taxes pay for as much as anyone else’s. They never see the struggling villages that are fighting every day to stay alive, which have never known affluence, and the pensioners, parents and children who occupy this forgotten country.

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

In that context, does the hon. Gentleman share my concern that some of the public debate about planning policy has suggested that people in rural areas do not want to see any building or development at all, whereas actually having some houses that local people can afford—usually to rent—so that we have children in the schools is very important to them?

[Mr Reed]

I share the right hon. Gentleman’s concern. All too often, people—especially those who live in or adjacent to national parks—are treated almost as living museum exhibits. That policy attitude has to change and to change fundamentally.

That viewpoint, to which the right hon. Gentleman alluded, must change. As the economic squeeze worsens, as the public sector and the state retreat further and as areas of market failure become ever more prominent, all of us need to pay urgent attention to the plight of ordinary people in that forgotten England, because they need our help and they have little or no interest in the colour of our rosettes. That is why village schools are so important. They can act as the lynchpin for extended services in a community, through the provision of other public services such as general practice, citizens advice, tourist information or even banking. By doing that, they give us the best possible chance of reaching all the people I have mentioned and more, but particularly those most at risk of social exclusion.

The CRC report states:

“Small village schools are in close contact with families and have a track record of providing good outcomes for children. Based in isolated communities, small schools may hold the key to engaging the most disadvantaged families, but their numbers are decreasing.”

Ultimately, that is the crux of the issue. The closure of small rural schools such as Captain Shaw’s is perhaps not seen as a problem for those with private transport and steady employment, but delivers another significant contradiction with regard to the statutory responsibilities of the local education authorities and others in relation to child poverty.

The Child Poverty Act 2010 creates a duty for local authorities to reduce child poverty. As the CCR report points out:

“If poverty is to be tackled effectively, it must be a priority to identify and consult with those families who don’t know about or are prevented from accessing services.”

Village schools have a critical role to play in supporting individual families in need, or as a hub for activities that will promote learning, economic well-being and social cohesion. More than that, it is clear that the choice is becoming binary. Maintain small village schools such as Captain Shaw’s in rural areas and extend their provision of services, and we can tackle the problems of poverty, aspiration and lack of economic opportunities in those areas. Close the schools, and the evidence would seem to be clear that we cannot do any of that. Closure is effectively a choice to worsen the lives and life chances of the people in any community facing the loss of its school. As the report points out, that loss is “felt to be irreparable.”

I therefore make three specific requests of the Government today. First, to intervene in the process to close Captain Shaw’s school. Allowing the smallest school in the country’s most beautiful national park to close would destroy any credibility of the Government’s presumption against the closure of rural schools—it could scarcely be more symbolic. Secondly, to ensure that local education authorities and other responsible bodies in the case of academies or free schools, nationwide, are acting in a manner consistent with the statutory obligation to reduce child poverty laid out in the Child Poverty Act 2010. Thirdly, to bring forward as a matter of urgency a streamlined process whereby small rural schools can provide extended services, whether public, private or both, so as to secure the viability of those schools and to reach the most excluded people in our communities.

While I have the Minister’s attention, it is only right that I raise the issue of school investment more broadly in west Cumbria. I have written to the Secretary of State, and I hope that he or the Minister will be able to meet me as a matter of urgency. Some of west Cumbria’s secondary schools, which had been allocated more than £60 million by the previous Government as part of the Building Schools for the Future programme, are reaching crisis point with regard to their physical fabric and infrastructure. That affects standards, attainment levels, teaching and the aspirations and ambitions of their pupils. We urgently need major funding for the fabric of our schools, whether from a public or private source, or the consequences for education and my community as a whole will be dire.

[Mr Robin Walker (Worcester) (Con)]

The hon. Gentleman is making a passionate case. Does he agree that it is not only the capital funding that is important, but the ongoing revenue funding for schools? A fairer funding formula, which does not discriminate against rural areas, is vital to keeping small rural schools viable.

[Mr Reed]

The funding formula does need to be looked at and, given the inconsistent definition of rurality to which I alluded, we need to have a more sophisticated approach to the funding of pupil places, rather than the blanket, catch-all provision for rural areas and the blanket, catch-all provision for urban areas. The hon. Gentleman makes a very important point, which needs urgent attention. Whether it is as simple as introducing a one-size-fits-all approach for rural areas, I am not so certain—we would need to look at the evidential base.

I was about to conclude. We are an ambitious community, as I am sure the Minister is aware, with an incredibly prosperous future before us if we make the right decisions, but we require the reinstatement of the money that the Government took away. I hope that the Minister will meet me as a matter of urgency to explore how and when that can be done.

14:46

[Rory Stewart (Penrith and The Border) (Con)]

I thank the hon. Member for Copeland (Mr Reed) for securing the debate and for all his leadership on Cumbria. Central to the issue is rurality and sparse population, and if he represents the constituency in England furthest from London, I represent the constituency in England with the most sparse population. We have about 1,200 square miles and some 1.5 million sheep, but not many people.

The central issue to do with rural schools is simply an aspect of the central problem of rural communities. That problem is the relationship between population and area. Since 1997, we can see a consistent pattern throughout almost every area of rural life: a steady push and a clear, unstoppable trend towards the hollowing out of rural areas.

We have two hospitals in northern Cumbria serving 350,000 people. That is normally difficult for the Treasury to justify, and our Cumbrian hospitals have been in receipt of emergency funding from the Government every year for 19 years, bailing out that fundamental structural problem. Our ambulances in Cumbria find themselves drifting endlessly south, towards the population centres. In fact, every morning the ambulance sets off bravely from Brough, but because it is obliged to pick up the nearest possible case and that always tends to be further south, it is somewhere south of Blackpool by the time it has to turn around and go back up to Brough in the evening. The same extends to old people’s homes, post offices, pubs, farms and broadband—we have some of the slowest broadband in Britain—and to issues such as flood protection, which I discussed with the hon. Member for Copeland earlier.

Since 1997, therefore, we have seen a cataclysmic hollowing out of rural areas throughout the country. Nationally, there are now 2,200 fewer schools in Britain than in 1997, 550 fewer clinics and hospitals, 350 fewer police stations and, famously, almost 10,000 fewer pubs—mostly gone from rural areas. It is, therefore, something of a miracle that our rural areas survive at all, when so much of the structure in the modern world seems to be set against them. In the Pyrenees, one can walk through abandoned village after abandoned village, and the same is true in the central United States. It is a miracle that Governments have managed to fight the endless centralising power of the market that tends to drive people out.

[Julian Sturdy (York Outer) (Con)]

My hon. Friend is making some powerful arguments. Is not part of the problem—it certainly is in my region—that small rural communities are classified as unsustainable by their local authorities and local development plans, so they cannot expand and support local schools, post offices and so on? The problem is that communities in such areas want to expand, but are not allowed to, and the unsustainable tag becomes a self-fulfilling prophecy.

[Rory Stewart]

My hon. Friend makes a powerful point. The slogan of sustainability is used to cover up a whole series of crimes perpetuated against rural areas by local authorities. Local authorities imagine that there is an incredibly unfair structural system whereby rural areas are continually subsidised by more densely populated areas, and they demand to know why that should be. The reality, of course, is that rural areas are often in receipt of less funding than urban areas, despite higher costs. For example, education provision in Cumbria is £4,840 per pupil, compared with a national average of £5,140, despite the structural problems that the hon. Member for Copeland mentioned, and which I shall continue to discuss. Our communities put incredible energy into trying to keep those assets open, providing volunteer time and free land, but that is swept aside by the centralising tendency.

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

My hon. Friend seems to be talking about small schools receiving more than other schools in Cumbria, but the schools that receive much more are those in towns and cities. It is not a Cumbrian fix; it is a national fix.

[Rory Stewart]

I thank my hon. Friend for his intervention. Perhaps I was not clear enough. The national average of school funding is £5,140 per pupil. Cumbria is in receipt of £4,840, so the point is exactly the one that he makes. If sparsely populated rural areas such as Cumbria are compared with urban areas, we receive less.

[Neil Carmichael (Stroud) (Con)]

My hon. Friend is making an excellent point, and I endorse it by pointing out that we have exactly the same problem in Gloucestershire, where there is the same funding difference between rural and urban areas. Gloucestershire is launching a campaign to put that right, and rightly so.

[Rory Stewart]

I thank my hon. Friend. The point about Gloucestershire is key. There are many reasons why things tend to get bigger, and why small shops give way to supermarkets, small dental practices give way to bigger dental practices, and small schools give way to larger schools. That is partly because of the regulations that we impose on such institutions, and partly because of pupils expectations and the variety of teaching that they can receive. That is difficult to deliver in small schools. When I look out of my window in Cumbria, I see a school in Bampton that had run continuously since 1613, but has had to close because it was considered to be unsustainable. It is an odd world where something that was affordable 400 years ago is no longer affordable when we are spending so much more per capita on our government.

The problem is size, and we have extremes. Samuel King school in Alston has only 161 pupils, making it the smallest high school in Britain. Why should it remain open? It remains open because it is more than 20 miles from Penrith, across a pass that is closed for many days during the winter. One simply cannot get to Alston, which is the highest market town in the Pennines. A school is necessary there, because students would otherwise not be able to get to school at all. Kirkby Stephen has the smallest high school in the country. It has 406 students, but only 70 are in the high school. Its catchment area covers 400 square miles of countryside, and whatever some fantasist would like to do in the name of rationality, that school provides an essential service.

Such schools face difficulties, because the lack of affordable housing, and the limited demographics mean that it is difficult for them to increase their numbers. Kirkby Stephen school breaks even with about 410 students. It makes money with 415 students, and if the number drops below 400, it loses an enormous amount of money, but it has little control over that because its catchment area is so limited in terms of population, although its size is large.

Almost every one of our outstanding schools in Cumbria—those that I mentioned are predominantly rated as outstanding by Ofsted, and are eagerly signing up for the Government’s academy programme—have continual financial problems. They have generally had to be bailed out by the county council year after year, and are in an uncomfortable position. When they become independent as academy schools, the funding they take on is the base level that they received from the county council, and does not include the emergency bail-outs that they received year after year, so they find themselves running up increasing deficits. That is so in Alston, and in Kirkby Stephen, where the debt is approaching £500,000—the £140,000 a year that it used to receive from the county council was discontinued at exactly the time it embarked on its, hopefully positive, future as an academy school.

I want to make two requests of the Minister. One is that we address seriously the issue of the rural funding formula. We should not allow that to be seen as a selfish attempt by sparsely populated areas, such as Cumbria, to steal money from more deserving people. It is consistent with our general attitude towards rural areas, and our general desire that rural areas should not be seen as places that we want to be hollowed out in relation to health care, transport or education. It is a fundamental commitment of our civilisation to rural areas.

My second request, which is smaller and technical, is that I would like the Minister to provide someone from the Department for Education to work with the boards of governors, particularly at Kirkby Stephen and Alston, on their budgets. They have launched themselves to academy status, and they have great governing bodies with great head teachers, but they could do with a lot of help to understand the budget. They are in a difficult situation because they hear one thing from the county council, and another with their new academy status. They need someone to compare their per capita funding with that of other schools around the country, and to provide technical advice on what would be reasonable reductions. That would be of enormous assistance to our schools.

On those two notes, and with acknowledgement to the hon. Member for Copeland, I thank you, Mr Weir, for calling me.

14:57

[Dr Thérèse Coffey (Suffolk Coastal) (Con)]

It is a great pleasure to serve under your chairmanship, Mr Weir. I congratulate the hon. Member for Copeland (Mr Reed) on securing this debate on the future of rural schools.

I represent a constituency in Suffolk, and when I moved to the constituency, I was impressed to discover how many small rural schools were able to survive. In my patch, I have seven schools with a roll of fewer than 50, and the smallest has about 20 pupils. A further six have a roll of fewer than 100. I have been impressed by the head teachers’ leadership in doing what they can to ensure that they keep the schools going in the communities. As the hon. Gentleman said, it is not a question of the rich rural message. People in urban places are often surprised at how many of our small rural schools have upwards of 40% of pupils receiving free school meals, which reflects the fact that poverty is spread throughout the country and not concentrated in urban areas.

Suffolk has managed to survive. I believe that it was the county council’s policy to try to keep as many schools as possible open. That is different in one of our neighbouring counties, where a deliberate attempt was made to close as many schools as possible and to consolidate primary schools. An interesting way that schools have got around that is by starting to share head teachers. I point to Peasenhall and Middleton schools, which have 56 children between them and share a head teacher, and that seems to work.

I grew up in Liverpool and went to a classic primary school, which had 30 or 60 kids a year and was all one school. When I lived in Hampshire and was a school governor in a rural area, I was introduced to the concept of mixed-age classes—combinations. I then went to schools, such as Peasenhall, where key stage 1 pupils were together and all the key stage 2 pupils were together. Trying to differentiate pupils—admittedly a small number —across a wide range of abilities and progress creates challenging teaching conditions.

I am sure that it is a great pleasure to step out of school and, instead of the hard concrete that I remember playing netball and other things on, have a view of beautiful fields and playing fields. That natural environment is impressive, and perhaps I did not share that experience where I grew up in Liverpool.

There are also financial aspects. We heard the eloquent contribution from my hon. Friend the Member for Penrith and The Border (Rory Stewart). Funnily enough, I have a village called Brampton in my constituency as well, which also has a very small primary school that suffers similar challenges to those that he mentioned. We get even less money than Cumbria does; the county of Suffolk gets £4,676.

I hope that the Minister recognises the challenges of sparse population, which include the costs of school transport. Shipping children around is expensive, and towns or cities in particular do not have those costs. I remember getting the bus to school and it was fine because there were buses every 10 minutes or so, but those of us with rural constituencies know that that just does not happen in those areas, and nor would I expect it to. I am not suggesting that someone who lives in the country should have the same public transport service as someone who lives in the middle of the city, but the additional cost pressures are a challenge for rural schools.

It would interesting to hear the Minister’s understanding of the progress on educational challenges for rural schools. People are hugely surprised to hear that somewhere such as Suffolk is pretty low down in its progress towards GCSE targets. That is not unique to my county, but is also true in other rural counties. I hope that the Minister and his officials are working on something to ensure that children across the country get the same support.

As my hon. Friend the Member for Worcester (Mr Walker) eloquently pointed out, there definitely seems to be a bias towards urban schools, which is perhaps tradition given the more conventional aspects of social deprivation and the indices. He pointed out to me that there are ongoing revenue challenges, because children with additional languages are not being identified quickly enough. More people are coming from eastern Europe with their children and settling in parts of rural and agricultural England, and that is not recognised. Some of the indicators are a few years old, so the revenue is not keeping up quickly enough.

I do not intend to detain the House for much longer. Plenty of right hon. and hon. Members want to stand up to ensure that rural schools get a fair share of the funding, but I encourage them, especially the hon. Member for Copeland, to encourage parents in their areas to find out whether a free school is possible. [Interruption.] Perhaps his nodding indicates that that has already happened. It has certainly happened in Suffolk. West Suffolk is going through a schools organisation review, which I fully support—I support the move towards a two-tier model, because it has been statistically shown that children can make more progress that way—but understandably, significant communities would have their schools removed, and we all know that when a school is lost, an element of vitality is lost as well.

As my right hon. Friend the Member for Berwick-upon-Tweed (Sir Alan Beith) said, a lot of countryside villages want more building because they want more families. They want a viable community, not to lose a school and see children transported 15 miles. A child transported to school has one minute to get on the bus, which significantly limits their opportunities for after-school activities. There is something to be said about hearing a positive message from the Minister, who I am sure, in his constituency in West Sussex, is constantly asked to ensure that the countryside is not forgotten.

15:06

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

I am glad to have the opportunity to take part in the debate that the hon. Member for Copeland (Mr Reed) so helpfully introduced. I must tell him that my constituency is even further from London than his and at least as sparsely populated as that of my hon. Friend the Member for Milton Keynes South (Iain Stewart). It is therefore an area with a lot of very small schools, and I have several with fewer than 12 pupils.

[Mr Reed]

I want to clarify that point. The right hon. Gentleman is, of course, geographically much further from London than I am, but I think that he can get here an awful lot quicker than I can.

[Sir Alan Beith]

I commend the east coast train service in that respect.

As I said, quite a number of schools in my area have fewer than 12 pupils. There is a unique school on Holy island that much of the time is combined with a school in Lowick on the mainland, but when the tide is over, the children are educated in a little village school on the island itself. That arrangement must continue or they would not be able to go to school without boarding at the age of five—of course, they board later in their educational career.

When a previous Conservative Government were in power and there was grant-maintained status, the county council threatened one school with closure. It went grant maintained and saved itself, and is still there to this day. It made a rather shrewd move. That was an exception to the pattern, and I will explain how school closures come about.

In my constituency, we have lost 10 rural schools in 10 years. Villages such as Kirknewton, Millfield, Chatton and Eglingham have lost their schools. Two schools are threatened at Cornhill and Brampton, and in both cases there are very small numbers of children at each school—just three or four. In the past, we lost schools in the Cheviot hills that served the communities of shepherds at places such as Windyhaugh and Southern Knowe.

The current policy of the county council is certainly not to bring about school closure, even though, like other authorities mentioned today, it gets much less per pupil than some urban communities, despite the high costs of educating pupils in a much larger number of schools scattered over many communities and the high costs of transport for children in rural areas, to which my hon. Friend the Member for Suffolk Coastal (Dr Coffey) referred. Closures in rural Northumberland have invariably happened because the governors have concluded that a school is no longer viable. That view is not always shared by the local community, which sometimes disagrees with the governors and would like to see a school retained.

In all cases, closure is to be regretted because of the impact on the community. The school is a meeting place. Some places where schools have closed have managed to retain them as community meeting places, but the loss of children from the village during the day is serious. They no longer put on the events they used to in the villages where the schools were situated—dramatic activities, re-enactments and so on, and music at church and chapel events. Many people prefer to see children in the village, morning and afternoon, going to and from school. The village becomes very quiet when there are no longer children going to and from school or voices from the playing fields at break time. That takes something out of a village.

The problem, in Northumberland at any rate, is not some bureaucratic and draconian policy of getting rid of schools, but a shortage of children and young families. Young families cannot afford to live in many of our villages; with low local wages and the price of houses, property is well beyond their reach. Houses are attractive to people coming to retire and those who want second homes and so are beyond the reach of local people.

Of course, many rural council houses have also been sold over the years. We therefore need to replace housing stock for young families in our villages. I repeat the point that I made in my earlier intervention: we must not let a sudden panic about planning policy lead people to the conclusion that no development can take place in rural areas. We need communities to have a life in the future, and that means having affordable housing for young families in villages, as well as workshops and other places where trades and activities can continue. It also means ensuring that we have other housing in villages, because we want communities to be mixed. Newcomers often bring life to a village and are often among the most active supporters of local institutions. We need to sustain our villages.

There are always a few children left—those of farmers and farm workers—but life becomes that much more difficult for them when there are no other children in the village, and the village is almost devoid of young families.

[Stephen Gilbert (St Austell and Newquay) (LD)]

I entirely share my right hon. Friend’s analysis that we cannot allow our rural communities to become fossilised and our villages to stop moving forward in time. Does he agree that the Localism Act 2011 and the community right to build represent an avenue that some villages will enjoy exploring as they grow? The register of assets of community value is another important provision that local communities can use in safeguarding some of the services, in addition to schools, that hon. Members have talked about.

[Sir Alan Beith]

Those measures, which the Government have introduced, are very welcome. People in the villages in my constituency are actively pursuing all those angles to ensure that local services continue to be provided. They have put a lot of effort into improving village halls, turning former schools into village halls and putting together schemes to help remaining schools, to work closely with them and to use community assets jointly with them. An awful can be done, but there need to be people to do it and young families to participate.

Let me give one salutary warning. The school in one village in my constituency closed many years ago. Later, there was some housing development. As a result, a busload of children now go from the village to another one five miles away because there is no school. Circumstances change, and we should think more often, when the situation allows, about reopening schools or even opening new schools in village communities that show real growth. That will be the exception, not the norm, but there are cases where such measures are appropriate. However, we need to try to sustain villages, so that our schools can continue.

Even in an area such as Northumberland, where no policy is being pursued directly to the detriment of village schools—that has been the case for some years—village schools are under serious threat. The threat comes from the decline of villages and the way in which the average age in villages is increasing year by year because of a shortage of young families. Safeguarding our village schools is therefore not just important, but part of a wider policy towards rural communities, and it will require great effort in years to come.

The Minister would be surprised—he can see what is coming—if I did not finish by referring to the high school that serves a large rural area of my constituency. Children go to the Duchess high school, in Alnwick, from villages from many miles around. I simply remind him that we are all waiting with bated breath for the school capital programme announcement. We are determined that the school—it is on a split site and in an appalling physical state, but it is a good school—can benefit from that programme as soon as possible.

15:13

[Neil Carmichael (Stroud) (Con)]

I did not come to the debate expecting to make a contribution, and I am grateful to you, Mr Turner, for allowing me to do so. I want quickly to refer to several points, which sprang to my mind while I was listening to the debate.

The first is that the Government are consulting on school funding, and that is absolutely right. It is important that rural school supporters, of which I am one, make absolutely sure to get across the point that these schools should be able to spend their budget with few prescriptions. We also need to sort out the argument over equality between rural and urban schools and, indeed, in rural areas. That is a fundamental issue, and the Government are rightly alive and alert to it.

The second dimension to the question about the future of rural schools is that some wish to expand. In my constituency, that is, to some extent, a pressure. The Government need to make it easier for schools to understand how they can expand and what mechanisms they might use to rise to the challenge of providing extra classrooms. The second issue, therefore, is letting existing schools expand.

The third point that we should discuss is the scope academies have in terms of primary schools and small schools. Giving schools additional independence and autonomy from local authorities addresses some of the issues that have arisen in the debate. It is critical that we send out the message to small rural schools that academy conversion is a way forward.

That leads to me to a point that struck me while I was listening to my hon. Friend the Member for Suffolk Coastal (Dr Coffey). She was talking about shared heads, and that is very much a direction of travel. Academies should be thinking very much about federalising structures, where appropriate, and about sharing facilities.

[Stephen Gilbert]

In my constituency, some very innovative academy chains are being created. That is allowing exactly the kind of economies that the hon. Gentleman is talking about, with a chief executive overlooking a number of primary schools. I therefore endorse his point.

[Neil Carmichael]

I thank the hon. Gentleman very much—I do like to be endorsed every now and again, and that was firm and fair.

Let me reiterate the point about free schools, which are obviously an alternative when a local authority is unwilling to countenance the continuation of schools. It is essential that local communities take hold of the powers and opportunities that the coalition Government have given them to voice what they want.

[Mr Reed]

The hon. Gentleman is making some interesting points, but one issue underlying a lot of the contributions that hon. Members have made is that school failures, for want of a better term, occur in areas of market failure. That is a fundamental problem, and we need to grasp it. It has been evident in England’s rural areas since the war, and it has been accelerating since then. These areas of market failure often have little, if any, real social capital. Are we really telling them, “You either have a free school or an academy, or we withdraw provision”? I do not think that we are, are we?

[Neil Carmichael]

I thank the hon. Gentleman for that interesting intervention—I do not think that it was an endorsement. I am challenging the old way of doing things, with local authorities providing schools and everything that was necessary. We have to take a step away from saying, “The local authority must do this, because it’s always been there, and that’s the way we like it.” We have to move towards a situation where we encourage communities to decide for themselves what they want and to move in the appropriate direction, seizing the opportunities and the tools that the coalition Government are providing. I am saying we should think of a different way of looking at this problem; we should not just go back to the local authority and say, “You must do this.” Instead, we have to go down the academy and the free schools route, if that is what communities want, because a sustainable community will be even more sustainable if it is in charge of its destiny. That is the point that I would make in response to the hon. Gentleman.

I am a great supporter of rural schools. They are absolutely important. They are a part of the rural fabric, make villages work, encourage farmers to be farmers and encourage local people to stay in local areas. However, we need to be more alert to changes that are already in train that will make it easier for many schools to prosper. We also need to address the fundamental and clearly most important question, which I raised initially, about the funding formula.

I support small rural schools. I have plenty in Gloucestershire and I want to see them thrive. The critical point that all of us must understand—I will end on this—is that all schools must strive to be really good schools. It is not good enough to say, “We have a rural school. Great.” Rural schools must provide first-class education. That must be the key test. That is what governs me and that is what I always think when I go around schools in my constituency of Stroud.

15:20

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

First, I congratulate my hon. Friend the Member for Copeland (Mr Reed) on securing today’s interesting and important debate and on making a powerful case. He told us about the proposal to close Captain Shaw’s school in Bootle in his constituency, which has 16 pupils. I think we would all agree that, in bringing the matters before the House today, he has represented his constituents with great passion. Such decisions can be made only at a local level, but it is right for my hon. Friend to seek to raise the profile of the issue by securing today’s debate. The points that he has raised here should be fully considered by the local authority before making any final decision.

We also had interesting contributions from a number of hon. Members today, including the hon. Members for Penrith and The Border (Rory Stewart) and for Suffolk Coastal (Dr Coffey), the right hon. Member for Berwick-upon-Tweed (Sir Alan Beith) and—in a rather impromptu manner, but no less interesting and important —the hon. Member for Stroud (Neil Carmichael).

Before I start, I should set out my own credentials and declare that I live in a distinctly urban area of Newcastle upon Tyne, and it takes me only three hours to arrive here by train. None the less, there is a strong case to be made here in today’s important debate about the issues that face rural communities, especially in relation to schools.

Contrary to the assertions made by the hon. Member for Penrith and The Border, Labour had, within a year of coming into government, introduced a presumption against closures of rural schools. The year in which the number of rural school closures was the highest was 1983, when 127 were closed. The rate of closures continued at about 30 a year until 1997. The measures taken by Labour reduced closures to an average of seven a year throughout the period we were in government. Furthermore, under the Education and Inspections Act 2006, the presumption against closure was strengthened by requiring that the closure of rural schools must take the effect on the community into account and look at alternatives.

[Mr Andrew Turner]

Will the hon. Lady tell me whether the closure of schools under the Labour Government could have been stopped at the national level?

[Catherine McKinnell]

Sorry. I did not quite understand the question.

[Mr Turner]

I am trying to ask whether under the previous Government, closure of schools could have been stopped, as it had been before 1997, by the Government.

[Catherine McKinnell]

That is a point to be debated. I think the hon. Gentleman was asking whether the Secretary of State could have intervened to stop the closure of state schools.

[Mr Turner]

indicated assent.

[Catherine McKinnell]

Not during that period, and not now.

[Rory Stewart]

I do not wish to debate statistics, but I am afraid that the idea that the average rate of school closures since 1997 is seven is a severe underestimation. I could name, off the top of my head, seven schools in my own constituency that were closed in the past five years.

[Catherine McKinnell]

No, but I agree that the hon. Gentleman has made a powerful case for the concerns in the area, regarding the decline that he feels he has witnessed in his area. I feel that all hon. Members today have made a powerful case for state intervention, particularly in such areas, and for serious consideration to be given to how the state can intervene in the market to try to ensure that rural areas do not suffer disproportionately, particularly in the cuts environment that we are facing at the moment. I would be interested to hear the Minister’s response to the concerns that have been raised today.

[Neil Carmichael]

I do not think I was making a case for state intervention. I was making a case for empowering our local communities to take charge of their own schools and to take hold of the opportunities given by the Academies Act 2010, autonomous schools and active, vibrant communities.

[Catherine McKinnell]

I thank the hon. Gentleman for his clarification. The overall impression that I got from hon. Members’ contributions today is that there clearly is a powerful case for concern about a purely market-led approach to education and the impact that that can have on rural communities.

[Mr Reed]

There is a world of difference between allowing communities to flourish and determine their own future, and throwing areas of market failure further to the forces and whims of the marketplace. Does my hon. Friend agree that we are all struggling with the following point? We are all debating different notions of rurality, and we are not considering some things that she will be aware of—as this is writ large in her own constituency—which are issues and notions of peripherality? They are the big issues that are driving the problem.

[Catherine McKinnell]

That is something we have witnessed not just in rural areas, but in urban areas. We need to ensure that taxpayers’ money and state support goes to all areas and all children—at the end of the day, they are what we are talking about today—that they benefit equally, and that that support is distributed equally across the country. We are debating that important wider issue.

Sometimes, when we consider all the factors, including the cost of additional school transport and the extreme case that was mentioned, in Alston in Penrith and The Border, it can make the case for closure of a small rural school more marginal. We were clear about the need to presume against closing rural schools when we were in government. In January 2008, the then Schools Minister, Jim Knight, now Lord Knight of Weymouth in another place, wrote to local education authorities. He said:

“Over the last 10 years, we have made it a statutory requirement for councils to presume that rural schools should stay open. There is not, and never has been, any policy for closing rural schools...We require councils to assess the full impact of closure on rural communities and allow every single parent to have their voice heard—and I am writing to local authorities to underline their legal duty to protect popular rural schools. This is not about funding. This is caused by falling birth rates coupled with families moving from rural to urban areas, which leaves some communities with falling numbers of pupils.”

He also said that local authorities should think creatively about their future planning and look at forming federations or consider collocating with other services to ensure that their buildings are viable.

Labour’s record was to reduce significantly the rate of rural school closures and to make it more difficult for failing ones to automatically lead to the seemingly easy option of closure.

One way of keeping rural schools open is to ensure that there are more opportunities for them to collaborate in an imaginative way. Despite the rhetoric that the Government sometimes spout, no school is an island. In the case of rural schools, that is particularly important—a point that has been highlighted by hon. Members today.

Under the previous Government, the Department for Children, Schools and Families undertook a research study in 2009 to look at case studies of formal collaborations between small rural primary schools in ways that could improve their services and viability. We saw examples of that occurring in sharing business managers and head teachers, creating patterns of executive leadership and sharing governance through federations and shared trusts. The study found a rich variety of informal collaborations but less awareness of formal collaborative models. It found that many of the 2,500 or so small primary schools in the country could benefit from more formal collaborations.

The main recommendations of the report include: producing better information and guidance of statutory models of collaboration; local authorities should develop strategic plans to promote formal collaborations; local authorities and Church of England dioceses should co-operate more closely; and local authorities should advocate formal collaborations more effectively through governing bodies and local communities.

One of the collaborations that was looked at involved shared trusts. In the unbalanced debate that there is at the moment because of the obsession with free schools and academies, not enough attention is being paid to the potential of trusts not only to keep open small rural schools, but to provide a coherent and integrated model of education in rural areas.

One of the most exciting developments is the spread of co-operative trusts. There are now more than 150 co-operative schools across the country. Particularly in areas such as Cornwall, there is real interest in that approach. Supporting co-operative models was a policy of the previous Labour Government and a commitment in “The Children’s Plan,” launched in 2007. By embedding what is essentially a social enterprise ethos in schools, co-operative schools can be based on values of collaboration and partnership, rather than the negative forms of competition between schools that the Government sometimes seem to advocate.

I shall put to the Minister questions that follow on from the points that I have raised and that respond to the points highlighted by other hon. Members. What are the Government doing to promote and encourage co-operative schools, particularly in rural areas? What are they doing to permit resources to promote the co-operative school model in the same way as they have earmarked funds for their pet project of free schools? How much money in total has the Minister allocated to the free schools policy? To what extent could that be diverted to other proposals? How much does it work out at per pupil? How many rural school closures could be prevented if money allocated to free schools in areas where there is a shortage of pupil places were diverted to small rural communities such as the one that my hon. Friend the Member for Copeland is so concerned about? Will the Minister retain the previous Government’s presumption against closing rural schools? Will he guarantee that the current Government will ensure that the rate of rural closures does not go up on his watch? I have concerns and, indeed, there are many concerns among Labour Members that an over-focus on peripheral projects means that the Government are in danger of forgetting about the real issues that face rural schools. I look forward to the Minister’s reply.

15:32

[The Minister of State, Department for Education (Mr Nick Gibb)]

It is a pleasure to speak under your chairmanship, Mr Weir. I congratulate the hon. Member for Copeland (Mr Reed) on securing this important debate. Cumbria in general and his constituency in particular are clearly among the most beautiful parts of the country. It was a pleasure to be in Cumbria this week, visiting schools—they were not in his constituency, but in a neighbouring one. There were times during this debate when I felt that there was an almost Mr Bounderby-esque competition to represent the constituency that was the furthest from London and the most sparsely populated. Of course, the hon. Member for Newcastle upon Tyne North (Catherine McKinnell) conceded that she would be in last place in such a competition.

The Government share the hon. Gentleman’s views on the importance of small rural schools. We recognise the contribution that they make, and that often they are at the heart of their communities. Rural schools play an important role in our education system. Of the 18,500 maintained schools, 5,400 are rural schools. As of this month, there is a total of 312 rural academies, including converters, and 1,294 urban academies.

Small schools are classified as state-funded primary schools with fewer than 100 pupils and state-funded secondary schools with fewer than 600 pupils. There are 57 small academies, of which eight are rural schools, and 2,800 maintained small schools, of which 2,300 are rural schools. Of those, 525 schools have fewer than 50 pupils on their roll, of which only 14 are not rural schools.

There are many high-performing rural schools that are popular with parents, and the Government want to see good and accessible schools in every community. However, as we have debated today, schools in rural areas face particular challenges, including smaller pupil numbers, budget and resource pressures, greater difficulty in recruiting head teachers and teaching staff, the technological challenges of ensuring adequate broadband, and less peer support from schools in neighbouring areas. All those pressures can lead, in the words of my hon. Friend the Member for Penrith and The Border (Rory Stewart), to the hollowing out of rural areas. He made a powerful speech in defence of rural areas.

However, although it is true that some rural schools are isolated, there are good examples of effective collaboration —something referred to by the hon. Member for Newcastle upon Tyne North—and a growing trend towards federation, as pointed out by my hon. Friend the Member for Suffolk Coastal (Dr Coffey). Some schools in her constituency share head teachers. That helps to preserve the focus of education within the locality, while allowing the operation of a larger management unit and offering some economies of scale.

There is also a growing trend for good and outstanding rural schools to convert to academy status. We encourage such applications, in line with the Government’s overarching ambition for all schools to become academies—that was referred to by my hon. Friend the Member for Stroud (Neil Carmichael)—so that more children can benefit from the improved standards and autonomy that academy status brings. To support that intention further, the new academy presumption in the Education Act 2011 requires local authorities first to seek proposals for an academy or free school where they consider that there is a need for a new school. The Government’s free schools policy supports rural school provision, as it can respond directly to local parental demand—that was also pointed out by my hon. Friend the Member for Stroud—and it adds diversity, innovation and commitment to the school system. Again, we encourage rural groups and parents to consider applying to establish a new free school where they think there is a need. There are already three small rural free schools, with a further 18 in the pipeline.

Home-to-school transport will invariably be part of any discussion about rural schools, as pointed out by my hon. Friend the Member for Suffolk Coastal. That will be the case particularly where a school is proposed for closure and the pupils will need transportation to a different school in a different village. We know how crucial transport is to rural communities. The Department for Transport has provided £10 million of extra funding for community transport in rural areas. Of course, local authorities need to consider transport costs when they consider the projected savings from closing a school.

I was struck by the point made by my right hon. Friend the Member for Berwick-upon-Tweed (Sir Alan Beith) about a rural school in his constituency. It was a village school that closed. Later, a new housing development was built, which required all the children from that housing development to get on a bus to a village several miles away, at considerable cost to the local authority.

[Mr Reed]

The Minister is making a very informed and intelligent series of comments, but how can we expect academies and free schools to flourish in the areas that we are talking about? The areas facing these difficulties and problems with school closures are typically areas where there is no social capital and where civic society has either withered or largely gone, yet we are expecting the people in those areas to take up the cudgels and run schools. There is a tension and a problem there. How do we get around that?

[Mr Gibb]

The hon. Gentleman makes a very good point, but there are very determined parents in all communities in all parts of the country. We have seen that. Many people have been surprised by quite how much demand there has been to set up free schools. The number of applications has been in the hundreds, and although there is a very rigorous vetting procedure that needs to be gone through before people can continue on to a business case, those applications have come from a wide variety of parts of the population—rich and poor, north and south and rural and urban—so if I was the hon. Gentleman, I would not be too pessimistic about who might come forward with such a suggestion. Also, some of the academy chains may wish to establish new free schools in areas where they perceive that there is an educational need, particularly in areas of deprivation, which can of course, as he and the hon. Member for Newcastle upon Tyne North point out, be rural as well as urban.

Local authorities are responsible for the maintained schools in their area and as such they can propose changes, including closures, to those schools. Where changes are proposed, the local authority must follow a statutory process that includes consultation of those likely to be affected by the proposals. The proposals are then decided on under local decision-making arrangements by the authority. The Government have repealed the so-called surplus places rule, which obliged local authorities to remove surplus places in their school estate above 25%. Of course, local authorities are still obliged to ensure value for money. When considering whether to approve proposals to close a school, local authorities must have regard to DFE guidance for decision makers. That includes the presumption against closure for rural primary schools. As the hon. Member for Newcastle upon Tyne North said, such arrangements were introduced by the previous Government, but in answer to her specific question, this Government continue to support such a presumption. Although it does not mean that rural schools will never close, it does ensure that a local authority’s case for closure must be strong. Of course if local authorities are under a regulatory duty to eliminate surplus places, that would—and did—act as a countervailing pressure to close schools. My right hon. Friend the Member for Berwick-upon-Tweed made an important point about how circumstances can change.

[Rory Stewart]

Will the Minister explain what is happening with this long-term trend? Contrary to the claims of the shadow Minister that an average of seven schools a year were closed during that 13-year period, the Department’s figures suggest that the number of schools nationally has fallen from 26,362 in 1997 to 24,605 in 2010. If all these safeguards and formulae are in place to prevent schools from being closed, why have nearly 2,000 gone?

[Mr Gibb]

I stand to be corrected, but I think that my hon. Friend is citing the figure for schools overall. There was a considerable number of school closures, and we were concerned in opposition about the number of Titan schools that were developing. The average size of a secondary school, and indeed of a primary school, increased during that period. Much of that was driven by the regulatory statutory requirement on local authorities actively to eliminate surplus places beyond 25%. That has now led to problems. The birth rate has risen and there is an increasing demand on primary school places, and we now have to rebuild, purchase or expand primary schools to cope with the rise in numbers.

There is a case for saying, “Why don’t we mothball classrooms, because in several years’ time we could see an increase in the birth rate?” However, that comes at a cost, which local authorities must take into account when they make such decisions. As far as rural schools are concerned, my understanding is that the introduction to that presumption did reduce the numbers of rural school closures from about 30 a year to an average of 11 in recent years. None the less, I stand to be challenged by my hon. Friend at any point.

[Rory Stewart]

rose—

[Mr Gibb]

Indeed, I stand to be challenged right now.

[Rory Stewart]

I am so sorry. I hesitate to quote, but the Conservatives’ own manifesto on rural areas based on freedom of information requests to local councils established that more than 400 rural schools were closed between 1997 and 2010.

[Mr Gibb]

I am rapidly trying to calculate 400 divided by 13. I will come back to my hon. Friend when I am sure that I have all the mathematics absolutely correct, that we are both defining rural schools on the same basis, and that we are not conflating rural and small. I will write to my hon. Friend because I want to know the answer to this question as well.

The protection for rural academies lies in their seven-year funding agreement with the Secretary of State, which requires his consent before it can be terminated.

Let me turn to the issue of school funding. The main funding issue faced by rural schools is that, as they are generally much smaller than schools in urban areas, they do not benefit from the same economies of scale. Our analysis shows that it is small primary schools in particular that need additional support to remain viable. The hon. Member for Copeland and my hon. Friend the Member for Penrith and The Border pointed out the discrepancy in funding that Cumbria receives—£4,828 per pupil compared with £5,082 on average nationally. That puts Cumbria 105th out of 151 local authorities. My hon. Friend the Member for Worcester (Mr Walker) has taken an active role, as part of the f40 group—the Campaign for Fairer Funding in Education—in trying to address these issues.

[Mr Robin Walker]

I thank the Minister for his kind words and for giving way. Given that the Government are preparing to respond to their consultation on the funding formula and that the previous Government recognised that the funding formula was in need of reform, would he agree to meet me and other MPs representing f40 constituencies to hear the concerns of the group ahead of the Government’s official response?

[Mr Gibb]

I would be delighted to meet my hon. Friend and other hon. Members who are part of the f40 group to discuss their concerns about the funding. We do want to address these disparities in our funding system. That is why proposals in the “Consultation on School Funding Reform: Proposals for a Fairer System,” which we undertook in 2011, looked at how small schools could be better protected, as well as at the underlying discrepancies and unfairness that are in the current system. We would like to address the disparities in the rural schools either through a sparsity weighting or, in the case of primary schools, through a lump sum figure. The lump sum suggested in the consultation—I emphasise that it is only a consultation at this stage—is £95,000.

We have published a summary of responses that we are considering and we will make a further announcement in the spring. We had better arrange this meeting with my hon. Friend and other hon. Members before that response; otherwise, the meeting might seem a little superfluous.

In the interim, for 2011-12 and 2012-13, we have set a cash floor of minus 2%, which means that, in practice, no local authority will see a drop in its dedicated schools grant allocation of more than 2% regardless of pupil numbers. That is to protect local authorities that have falling pupil numbers.

I understand the local community’s passion for Captain Shaw’s school in the constituency of the hon. Member for Copeland. I can see why it is the “beating heart” of the community and why it is supported by an “indomitable community spirit.” As my right hon. Friend the Member for Berwick-upon-Tweed pointed out, people prefer to see village children attending their local school, being heard at playtime and being seen walking home instead of arriving home half an hour or an hour later on a school bus. I understand that the local authority in Cumbria has provided small school support through its funding formula and that the school has received a one-off schools in financial difficulty allocation to protect its budget concerns.

15:47

Sitting suspended for a Division in the House.

15:57

On resuming—

[Mr Gibb]

It is nice to be back after that short interlude to vote in the main Chamber. I see that we are now a little more sparsely populated than earlier, but I understand the pressures on hon. Members, and their commitments in the House.

I want to finish by commenting on the local authority and Captain Shaw’s school. It is concerned that the school has a capacity for 56 pupils but is now teaching only 16, which indicates issues about the popularity of the school. The local authority undertook a consultation on the proposed closure of Captain Shaw’s school and on Monday, after consideration by its scrutiny committee, it took the decision to go ahead and publish statutory proposals for the closure. Now a statutory process must be followed, and that will be decided by the local authority. As a voluntary school, Captain Shaw’s has a right of appeal to the independent schools adjudicator if it does not agree with the local authority’s decision.

The hon. Member for Copeland asked whether Ministers can intervene in the closure process. The Secretary of State cannot normally intervene in closure processes, but can do so under the general powers, where the local authority has not performed the statutory duty or has behaved unreasonably in that judicial review legal sense. I am happy to meet the hon. Gentleman to discuss this, general funding issues for schools in rural areas and the other matters that he referred to in his speech.

Finally, I can confirm that the Department for Education is very committed to and ambitious for rural communities and their schools. We recognise the importance of preserving access to a local school for rural communities, and that is why we will be contributing to the Government’s rural statement, recognising the importance of ensuring that rural communities thrive, benefit from and contribute to sustainable economic growth, and are able to identify and address local needs. As part of that, we are working to ensure that there is greater choice in rural areas, that standards are improved by increasing the number of academies and free schools, and that the number of rural school closures is kept to a minimum.

Haemophilia

Wednesday 8th February 2012 Westminster Hall

16:01

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

I am delighted to serve under you today, Mr Weir, and I am pleased to have secured this debate on an issue that I know is of interest to a number of Members from all parties. I pay tribute to the Minister present, the Under-Secretary of State for Health, the hon. Member for Guildford (Anne Milton), who has taken a keen interest in this area, and with whom I have had a number of meetings. I am a little disappointed that the debate is a short one and that I can give only the headline figures. There are many issues to raise, but I will try to concentrate on just a few.

I pay tribute to my constituent, Glenn Wilkinson, and to his family, who first came to see me in 2010 to tell me their story, and to raise the scandal of how he and thousands of others had received contaminated blood products as part of their treatment as haemophiliacs. There are two main parts to what I want to say today: the first is on the ongoing treatment for haemophiliacs, and the second is on the care, support and treatment offered to people who have contracted viruses such as HIV and hepatitis C through NHS treatment for haemophilia. I also want to pay tribute to the work, over many years, of the Haemophilia Society, and of campaign groups such as TaintedBlood and the Manor House Group, and also to the work of the Newcastle initiative, which was born out of a multidisciplinary workshop on haemophilia care held in the city in autumn 2010.

Turning first to treatment, I want to concentrate on the need to ensure that the care and treatment of people affected by bleeding disorders is addressed in the NHS reforms that are currently before Parliament. The haemophilia community has been the subject of what Lord Winston described in his evidence to the Archer inquiry as the

“worst treatment disaster in the history of the NHS”.

There has been much progress in haemophilia treatment over the past decade, but it is now under threat, as is much else, from the Health and Social Care Bill, and I will go on to explain why. Standards of care vary considerably around the country, and there is the risk that the new commissioning arrangements for specialist services will result in a levelling down, rather than up, in haemophilia care.

Haemophilia services are currently commissioned by 10 regional specialist commissioning groups, with funds pooled from their constituent primary care trusts. The Department of Health has also injected extra funding for haemophilia care, which rose to £88 million per annum between 2003 and 2006, to finance the provision to all patients of recombinant rather than plasma-derived clotting factors. That money remains important to the quality of care, but has more recently been absorbed into PCTs’ baseline budgets, and I seek reassurance from the Minister that the money will still be available for haemophilia care post the NHS reforms. I understand that from April 2013 specialist services will become the responsibility of the NHS Commissioning Board rather than of the 10 specialist commissioning groups. That could mean that best practice is spread across England, but equally, there is the danger that under financial pressure standards will be levelled down.

I also want to raise with the Minister the question of where responsibility for haemophilia policy will sit. Because of the contaminated blood scandal, the Department of Health has taken a leading role in the development of that policy, and it is unclear whether after the passage of the Health and Social Care Bill that role will be maintained, or all responsibility will pass to the NHS Commissioning Board. It would help if the Minister could set out her understanding of where that responsibility will sit. Also, will the twice-yearly liaison meetings between the Department and the Haemophilia Society continue? Those meetings were established in direct response to the Archer inquiry’s recommendation that a statutory committee be established to advise the Government on clinical, financial and other provisions for people with haemophilia. There is also a call for a new national policy statement on haemophilia care to replace health service guidance (93) 30, which is now nearly 20 years old and no longer reflects best practice. Can the Minister confirm that that will happen at this stage?

Does the Minister agree with the need to support the development of robust haemophilia networks to combine the best of local care with access to tertiary expertise 24 hours a day? For example, in a recent survey by the Haemophilia Society, only 15% of respondents were aware of having been offered a care plan. In both the report of that survey, entitled “Fit for the Future: Haemophilia Services in the New NHS”, and in the Newcastle initiative’s paper, “Learning from the past to inform the future”, it was found that standards of treatment and care were generally high, which is very encouraging, but that access to the provision of associated services, including dentistry, physiotherapy and psychological support, required significant improvement. The reports also concluded that patients must be given a comprehensive care plan, that they must be able to access home treatment, and that they must be involved in all decisions about all their treatment. Those goals are partially but not consistently met under the current system, and we would, of course, like to see consistency across the whole country.

All Governments have said that lessons about treatment have been learnt from the contaminated blood scandal and that there is a need to maintain the highest standards of care so to avoid any repetition of it.

[Jim Shannon (Strangford) (DUP)]

I congratulate the hon. Lady on bringing this matter to Westminster Hall. Is she concerned about the level of support given to haemophiliacs who have received blood contaminated with HIV or hepatitis C? Should an additional level of care and assistance be given to those who suffer through no fault of their own but because of the blood?

[Diana Johnson]

I will come on to deal with the financial support that is available to individuals who have had contaminated blood products and now have HIV or hepatitis C, because that is an important issue.

To finish this first section on the treatment of haemophilia, may I ask the Minister to confirm that there should be continued research, for example into sterilisation in areas with a high risk of variant Creutzfeldt-Jakob disease contamination, in order to support the need to ensure that a contaminated blood scandal never happens again?

The second part of my speech relates to contaminated blood. In recent months, along with many other Members of Parliament, I have been raising the issue of care and support offered to victims of the NHS contaminated blood scandal, as it has come to be known over the past 30 years. My constituent Glenn Wilkinson has campaigned tirelessly for proper support for those who have received contaminated blood products as part of treatment for haemophilia or via other medical treatments, such as blood transfusion in childbirth.

This week, Glenn and other campaigners established the contaminated blood campaign. The treatment of people who contracted hepatitis C from NHS-administered blood products has been particularly unfair, and many of those people have, unfortunately, died already. The campaign set up by Glenn is also fighting for an independent public inquiry on the same lines as the report in Ireland and the Scottish Penrose inquiry, which I believe is due to conclude shortly.

[Jason McCartney (Colne Valley) (Con)]

I congratulate the hon. Lady on securing this excellent and timely debate. I have worked closely with her on the all-party parliamentary group on haemophilia and contaminated blood. Her constituent was instrumental in setting up the new contaminated blood campaign. It would be good if the Minister could pledge to meet leaders of the new campaign to discuss some of the issues and move forward. I know that the Minister has met regularly with some victims of the contaminated blood scandal. This would be a good opportunity to pledge to meet those campaigners and to keep that good communication going.

[Diana Johnson]

I am grateful for that intervention. I pay tribute to the hon. Gentleman for his involvement in and hard work on behalf of the all-party group. He makes an excellent point in asking the Minister whether she will find time. I know that she has a busy diary, but she has made time in the past to meet victims and Members of Parliament. I hope that that will happen in future as well.

On compensation for those infected by contaminated blood products, the Macfarlane Trust was set up in 1988 for people infected with HIV. In 2004, the previous Labour Government established the Skipton fund. In 2010, the incoming Government undertook to review the support available to individuals. Some progress was made, but unfortunately, there are still problems with the system.

In particular, I am concerned about the fact that the Government have introduced a two-stage payment for hepatitis C, but the criteria for determining the second stage are still fraught with difficulties for many. As I understand it, only about 20% of those people with hepatitis C are eligible for assistance via the second stage payment. That must be looked at. My constituent Glenn has produced evidence that removing the artificial distinction between stages 1 and 2 could be achieved and would cost about £22 million, which I am led to believe could be reallocated from the under-spend of other available compensatory pockets of money.

Welfare reform is an issue for the group of people we are discussing. We have had a lot of discussion in the House of Commons about the impact of welfare reform on cancer patients, but there is a special case to be made for people with hepatitis C.

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

I join other hon. Members in congratulating my hon. Friend on obtaining the debate. She speaks powerfully for her constituents, as well as for my constituents, Fred Bates and Peter Mossman, who will be grateful.

The core theme of my hon. Friend’s powerful speech is trust. The trust of that community was shattered by their experience. This Minister is trying hard to restore that confidence, and her work is important, but is it not the case that the needs of our constituents with haemophilia who have been infected with hepatitis C and other infections should always come first now, not last, after the dreadful experience that they have had?

[Diana Johnson]

My right hon. Friend makes a powerful point about trust and the need for us all to work together to ensure that those people do not suffer further, and that they get the compensation and support they are clearly due.

I want to concentrate on hepatitis C sufferers for a minute. I believe that they will be unfairly penalised by the Government’s plans in the Welfare Reform Bill. In a debate in October 2010, I asked the Minister whether it would be possible for people with hepatitis C and HIV to be passported on to the new system. The Haemophilia Society has also asked about people with fluctuating medical conditions, such as bleeding disorders, particularly those with viral infections from contaminated blood products. People suffering from fluctuating medical conditions such as haemophilia, HIV and hepatitis C tend to have good days and bad days.

The Haemophilia Society recommends that the work capability assessment be suspended for people with fluctuating conditions until Professor Harrington has considered the representations of the Disability Benefits Consortium. Many people living with hepatitis C in particular have been placed in the work-related activity group of the new employment and support allowance, rather than in the support group, where benefits will continue indefinitely. That has two consequences: it means that sufferers will have to have annual assessments, and that, after 12 months, their benefits will become means-tested. That is effectively penalising people for prudent behaviour and hard work while they were well enough to be employed.

People diagnosed with hepatitis C know that they are unlikely to be able to continue working until normal retirement age. Furthermore, people must currently wait up to 11 months for a tribunal appeal. It is to be noted that appeals for hepatitis C sufferers have a particularly high success rate. Automatically moving contaminated blood product victims into the support group would save patients stress and the Government money.

[Jim Shannon]

I thank the hon. Lady for her graciousness in giving way. Many haemophiliacs have suffered from poverty and discrimination because of contaminated blood. Does she not feel for that reason that the Government must urgently address those still suffering from such maladies?

[Diana Johnson]

The hon. Gentleman makes that point powerfully. To quote from the report “Fit for the Future”, to which I referred earlier, an individual was asked what could be done to improve their quality of life and said:

“I think the most obvious thing to do would be to be spared the ordeal of having to do battle with the Government for financial security and not having to justify my right to sickness benefit”.

Let us keep working on compensation and related issues to improve life in the longer term for haemophiliacs and all innocent victims of contaminated blood products. In the shorter term, when considering NHS and welfare reforms, let us ensure those people’s lives do not get any worse.

16:18

[The Parliamentary Under-Secretary of State for Health (Anne Milton)]

It is a pleasure to serve under you, Mr Weir. I thank the hon. Member for Kingston upon Hull North (Diana Johnson) for securing the debate. I am grateful for the opportunity to discuss the issue. I also thank her particularly for her comments about the contact that we have had. I will continue to keep in contact with her and many other Members who continue to highlight the specific issues suffered by their constituents. I know that Glenn Wilkinson and others, some of them not still with us, have worked tirelessly on the issue.

I was interested to hear about the new campaign. Of course I will meet its representatives, as I continue to do. This is an opportunity to say that Whitehall can be distant from the rest of the population. As a Minister, I will, as all Ministers should, use the opportunity that Back-Bench and Opposition Members have given us to ensure that we stay in touch and do not become insulated from what is happening in people’s lives.

I wish that I could make up for what happened. It is a very long and sad saga. I can do only what I can do starting from here. I am also aware of the fact that it will never really be enough, because I cannot turn back the clock, but what matters is that we keep contact going.

The hon. Lady asked specifically about future commissioning arrangements and specialised services for haemophilia and other related bleeding disorders. As she has rightly said, those services are currently commissioned at a regional level by specialist commissioning groups. We are working with the NHS to produce a list of specialised services to go in a new set of regulations for the NHS Commissioning Board. At the moment, we are not able to produce a final list, but a list of services currently set out in the Specialised Services National Definitions Set—the titles that the Department of Health and others come up with are extraordinary—will form a basis for the Commissioning Board’s final list. I expect that we will be in a position to announce that list of services in the coming months, at which point it will be subject to consultation.

The hon. Lady is right to say that that will be an opportunity to share best practice. I get frustrated when I hear that some areas do things well, while others do not or do not adopt the same sort of best practice. The hon. Lady has voiced her concerns and fears that this could lead to services being levelled down, but I think there will be an opportunity—I was born an optimist—to share best practice. The financial arrangements for this particular group of people affected by contaminated blood will remain an issue for the Department of Health. What matters on services, however, is that we ensure that best practice is shared.

The hon. Lady mentioned care plans. As somebody who trained as a nurse and who worked in the NHS for 25 years, I get frustrated about this issue, because everybody should have a care plan and everybody should be involved in it. The plan should involve all the different agencies, including the local authority on housing and social services on social care. It could also involve the voluntary sector for people who are isolated. A number of agencies can improve the quality of life and ensure that people’s lives are fulfilling and meaningful.

Today, treatment for haemophilia is much improved. On the issue of blood safety, which the hon. Lady raised, some haemophilia patients still need to be treated with products that have been manufactured from human plasma, but those products are manufactured under very strict safeguards. Many haemophilia patients are now treated with synthetic products, and both types of product are extremely safe. Lessons have been learned. The shadow of what happened all those years ago continues to hang over us and everybody involved with the safety of blood products.

Synthetic and plasma-derived clotting factors are procured nationally by the Department, with commissioners and clinical and patient representatives involved from an early stage. That means that the NHS buys products that are not only cost-effective, but reflect what patients and doctors actually need. In turn, manufacturers and suppliers can better understand what matters to the people who use those products. At the end of the day, that is what should matter to us.

To further improve patient involvement, the Department of Health has brought the Haemophilia Alliance into discussions on all the issues that affect haemophilia patients. The alliance is made up of patients, clinicians and other professionals involved in haemophilia care, and I am grateful to those who give up their time to involve themselves in it so positively.

A decontamination research funding initiative worth about £2.4 million over four years was announced in 2011. It will address the decontamination of surgical instruments, improving the effectiveness of washer disinfectors and exploring contamination and novel technological approaches to the decontamination of endoscopy scopes. These products will also have wider applicability to human prion diseases, such as CJD, and other health-care-associated infections. Some issues are unresolved, because the proven and effective technologies needed to address them do not yet exist. There will continue to be money in research until we are absolutely sure that we have done all we can.

When people were infected with hepatitis C and HIV, it also had a significant effect on their families. We often forget that such issues have a massive ripple effect, not just on immediate family but on distant family. In January 2011 the Secretary of State announced that we would provide additional support, not just for haemophilia patients, but for anyone infected with HIV or hepatitis C by NHS blood transfusion. That support includes ensuring that the annual payment for those infected with HIV is linked to inflation; introducing a similar payment for those most seriously affected by hepatitis C; and increasing the value of the lump sum. The support will also make £300,000 available over three years for counselling services. I find it interesting to look at the uptake for such things, because it lets us know when we have hit the target. It is so important that I continue to get that feedback. The combination of fixed and discretionary payments provides flexibility to enable them to be tailored to meet individual personal needs.

I know that there is concern that insufficient support is available for people who have developed hepatitis C, particularly the Skipton Fund stage 1 recipients. The scientific and clinical advice that we received during the review that we conducted in autumn 2010 did not support regular annual payments to everyone infected with hepatitis C, many of whom go on to clear the virus. I was delighted to hear from one such person, who has campaigned actively. New treatments are available, improving the prognosis for some infected patients, but I know—I think the hon. Lady was at the same meeting as me recently—that concern remains about the cut-off.

I know that one of the constituents of the hon. Member for Kingston upon Hull North has worked out the potential cost of removing the distinction between stage 1 and stage 2, but the current system of payments for hepatitis C is itself based on expert clinical and scientific review, which continues to support the two-tier system. Evidence, however, evolves and it would be arrogant of a Minister to say, “That’s it for ever.” It is terribly important, as I hear about the experiences of the constituents of individual Members, that I continue to receive advice, so that what we do is relative to the current expertise.

I apologise to the hon. Lady for not responding to her e-mail about my meeting with the expert group, but I was delaying my response while departmental officials worked out the details of the meeting. I am pleased to say that I will write to the relevant patient groups, asking them to nominate two people—I think that seems about right—to represent them at the meeting. I think that will be important.

The hon. Lady is probably aware of the Caxton Foundation, which provides support tailored to the needs of those affected. All payments made by the foundation are for the trustees to decide. I have met the trustees and their feedback is important in enabling us to see how the support works. The charity’s objectives are laid out in its trust deed, and it is accountable to the Charity Commission. I do not have any powers to direct it, but it has to be kept under review.

[Paul Goggins]

On the Caxton Foundation, in future will the Minister take particular notice of the needs of carers? It is important that that fund is in a position to support carers as well as those directly affected.

[Anne Milton]

Yes. I thank the right hon. Gentleman for that point. The discretionary ability to distribute funds is important. He is absolutely right to raise the issue of carers, who are all too often forgotten.

The hon. Member for Kingston upon Hull North mentioned the capability assessment. She might want to initiate a similar debate on that issue. Health conditions are not automatically a barrier to work, but we recognise that they are for some people. Indeed, some people will never work and we must make sure that we support them. It would probably not be right—this is certainly not in my gift—to give automatic exemptions, but I urge the hon. Lady to raise the issue with the Secretary of State and the Minister responsible.

[Diana Johnson]

It would be powerful if the Minister made representations to a fellow Minister. Has she had the opportunity to do that with her colleagues in the Department for Work and Pensions?

[Anne Milton]

As the hon. Lady rightly states, in my ministerial role, my responsibility is the health and well-being of the population. I will always continue to make representations, which often taken place—although sometimes they do not happen in the public eye. Just a word about the Lord Penrose inquiry: we will give assistance, but we will not be commenting on that. I have had a few letters about that. I will comment at the end of the inquiry.

The issue of trust has been raised. I will finish by saying that I know a lot of trust was damaged and that that has flavoured many things since then for good but also for ill. That is an extremely difficult issue and I would not presume to say that I can ever get anyone’s trust back for what has happened and what successive previous Governments have done or failed to do. I hope that we will continue to work constructively with other hon. Members to ensure that this group of people get the help and support that they need.

Human Trafficking

Wednesday 8th February 2012 Westminster Hall

16:30

[Mr Peter Bone (Wellingborough) (Con)]

It is a great pleasure to serve under your chairmanship, Mr Weir. I must first thank the Speaker for granting a very important debate on the need for a national rapporteur on human trafficking.

I am delighted to see that the excellent Minister for Immigration will be replying to the debate. He is well known for his commitment to fighting the evil of human trafficking and, along with the Prime Minister, he has the desire to put the United Kingdom at the forefront of that fight. Sometimes it is like pushing at an open door, and I am really grateful that he is here. I would also like to thank James Newhall, my special adviser on human trafficking, and Tatiana Jordan, who is working in my office as an intern. She did much of the research and drafted this speech.

At the beginning of any human trafficking debate, thanks must be given to Anthony Steen, the former Member for Totnes. If he had not raised the issue of human trafficking in the previous Parliament, we would not be where we are today. Anthony has helpfully made a number of suggestions that have been incorporated into this speech.

As chairman of the all-party group against human trafficking, I would like to say that there is one small area where the Government could move the cause forward, improve the fight against trafficking and, at the same time, save taxpayers’ money. One of the problems surrounding human trafficking is the lack of reliable information and data analysis permitting us to assess the scope of the problem in our country. The solution in the UK to that challenge is to establish an independent national rapporteur.

[Fiona Bruce (Congleton) (Con)]

I congratulate my hon. Friend on introducing the debate and on the excellent work he is doing as chairman of the all-party group against human trafficking. Does he agree that a positive example has been provided by the Dutch national rapporteur in this area, who since 2000 has made some 200 recommendations to the Dutch Government, many of which have led to improvements in Government policy in the field of human trafficking in that country?

[Mr Bone]

I am very glad that I gave way to my hon. Friend who is, of course, a very worthy colleague of mine on the all-party group. She is absolutely right about the Dutch rapporteur, about whom I will say a bit more later in my speech.

An e-petition on the subject reads as follows:

“Human trafficking is serious, international, organised crime. The money generated from it (an estimated $32 billion per annum worldwide) is only marginally less than from arms dealing and drug smuggling. Tackling it is a priority for all political parties and the current Government. Much effort is expended by NGOs, Police, Social Services and other key Government agencies, to tackle human trafficking in the UK and protect its victims. However currently there is no independent monitoring system to ensure that work is effective and coordinated. We call on the Government to establish an independent watchdog, in line with the recommendations of the CoE Convention on trafficking in human beings, to which the UK is a party, to monitor the performance of key agencies ensuring that victims’ needs and experience are central. The watchdog should report to Parliament on a regular basis to ensure transparency and accountability.”

Like many other e-petitions, once it reaches 100,000 signatures, the Backbench Business Committee can consider it for a debate. I am on the Backbench Business Committee, too.

I am pleased to be able to say to the Minister that that e-petition is well on the way to succeeding. This morning, I checked how many signatures there were and I am pleased to say that there were 116. That highlights the problem of the issue. Human trafficking is evil, wicked and underground. It is modern-day slavery, but so few people know about it. A national rapporteur would unite all our anti-trafficking efforts under one roof and guide us through the main challenges, making recommendations on measures that might be required on a policy level to protect victims’ rights and prosecute the traffickers.

As stated by our gutsy Home Secretary in “Human Trafficking: the Government’s Strategy”:

“The UK has a good record in tackling human trafficking...We need to do more to stop this horrific crime…By applying to opt in to the EU Directive on human trafficking, we have demonstrated our commitment to working with other countries in Europe to drive up standards across the continent in tackling trafficking.”

[David Simpson (Upper Bann) (DUP)]

I congratulate the hon. Gentleman on obtaining the debate. May I put on the record my appreciation and that of the people of Northern Ireland for his attendance at a conference last Friday night in Northern Ireland that brought a lot of groups together? We would like to put on the record our appreciation for his attendance and for his speaking at that debate. I am sure that he will agree that we need to do something drastically, whether through a rapporteur or whatever, because, as he has highlighted, there are 116 signatures and we have a long way to go to get 100,000.

[Mr Bone]

I say this deliberately: my hon. Friend is being very modest. He set up a conference on human trafficking in Portadown last Friday. Some 150 people were there. There were four main charities: Women’s Aid, A21, Stop the Traffick and the other important one I have just forgotten—[Interruption.] Against Child Trafficking. Senior police officers from Northern Ireland did a presentation and there was a short speech from me. We heard from Kate, who is a 21-year-old who rowed across the Atlantic with four other young women to raise awareness of human trafficking. Let us imagine what it must have been like rowing across the Atlantic, throwing up in the boat and all manner of other things. That shows the guts of those young people. I was delighted when my hon. Friend presented an award to her. He is a shining example of what Members can do in their constituencies. I have said to him—I genuinely mean this—that it was the best presentation I have seen. As usual, he is being unduly modest.

To return to the issue of having a rapporteur, the EU directive calls for the establishment of a national rapporteur or, as the Minister is probably going to remind me, an equivalent. I consider most of what the EU does to be wasteful, anti-democratic and not to be touched with a bargepole. However, in this case, the EU did not make the directive compulsory; it was something that member states could opt into. It was absolutely right for the Government to take their time to consider whether we should opt in. The all-party group urged the Government to opt into the directive, and then they decided to do so. That is exactly how we should consider EU directives. If it is in the interests of the country to opt in, we should do so. The crucial point is that, having opted into it, we have to implement it in full. If we accept that we must opt into the directive, then we must do so in full.

What we are doing? Maybe we should be looking at what gaps there are—that is probably better. There is currently no independent oversight of the human trafficking situation. A national rapporteur, or equivalent mechanism, must be independent from Government. If they are not independent, their work will not be considered authentic, as it will always be felt that the Government have somehow rigged the figures, and that whatever view is expressed will represent a spin on Government policy. No Government organisation will criticise its own Government.

What do we have at the moment? We have the Government’s interdepartmental ministerial group—something Jim Hacker might have thought up. It is considered to be the national rapporteur’s equivalent mechanism in the UK. This august body has only met twice in the past 18 months. However, the good news is that it has 20 Ministers on it—fantastic. All these Ministers getting together to discuss human trafficking—first class. There is only one slight problem. At the two meetings that have occurred, two thirds of the Ministers have given their apologies. I really do not think that we can claim that that is working in any way whatever.

The Minister for Immigration kindly wrote to me on 1 February, recognising the failure of the current system. He said:

“I will be reviewing the role and remit of the IDMG to ensure that it can effectively carry out the Rapporteur function in line with the requirements of the Directive.”

Well, I can solve the Minister’s problem. I can make his work load less. I can make his day happier. Instead of trying to bring together lots of disinterested Ministers and meeting once every nine months to be the equivalent of the national rapporteur, why not just have a national rapporteur?

The Netherlands, where a national rapporteur was established 10 years ago, has got a grip on the scale, variety and changing face of human trafficking, and can target their resources accordingly. The Dutch rapporteur is a former judge with a small professional team. She is independent from Government and her mandate and authority is recognised by every parliamentarian. Her annual report to Parliament includes information from various sources, such as the police, immigration service, border agency, social services, NGOs, churches and civil society.

Here is the latest Dutch rapporteur’s report, full of statistics, analysis and recommendations. It is debated in the Dutch Parliament. It is recognised by the Government, NGOs and media as the authentic guide to trafficking in the Netherlands. When I first met the Dutch rapporteur a few years ago, her office consisted of her and one researcher-secretary operating from a small office and costing next to nothing to run. Today, the Dutch Government have recognised the huge advantage of having a national rapporteur and have extended her remit twice. She now investigates not only human trafficking, but child pornography and sexual violence against children. The Dutch rapporteur fulfils the EU requirement and is cheap. More importantly, she has caused a step change in the Dutch fight against human trafficking.

How would a rapporteur help here? We have no idea of the scale of modern-day slavery in the UK. However, every so often, new information raises its head above the parapet. For example, it was in the news recently that at least 32 men, who were trafficked to six European countries, including Sweden, Norway and Belgium, to work on building sites, were duped, deceived, had their passports taken away and were not paid. Another example is from Bedfordshire. A group of Englishmen were abused by other Englishmen. The vulnerable victims, some of whom were starving, had been lured from soup kitchens, benefit offices and hostels with the promise of paid jobs and shelter.

[Anas Sarwar (Glasgow Central) (Lab)]

I congratulate the hon. Gentleman on securing the debate. Does he recognise the urgency of the situation, given that we have the Olympics this year and the Commonwealth games in Glasgow in two years’ time? During such international sporting events, there is an increase in organised crime and an increased risk of human trafficking. Therefore, we need a coherent strategy from the Government, working alongside the Scottish Government, to deal with the Olympics and the Commonwealth games in 2014.

[Mr Bone]

The hon. Gentleman is spot on when he says that this is organised crime. Where they see a big venue, they see money, and of course it is a danger. The Government are working to prevent that, but I still have my concerns about what might happen.

The latest example of human trafficking, which we discussed with my hon. Friend the Member for Upper Bann (David Simpson), was revealed last week. For the first time in Northern Ireland, there was a conviction for human trafficking. A legitimate restaurant owner from Hungary brought young girls from eastern Europe into Northern Ireland, with the promise of paid work in his restaurant. They arrived all very happy. They then had their passports and documents taken away, and were forced into a brothel. When I say a brothel, it is a house in a road where they were locked in a room for 24 hours a day. Some 70 women were trafficked. I use the word “women”, but I bet that some of them were actually technically children.

I am conscious that I am eating into the Minister’s time. I wanted to say a little about the UK Human Trafficking Centre, which has not worked as well as it should have done.

[Mr Mike Weir (in the Chair)]

Order. There is slightly more time because of the earlier Division. If the hon. Gentleman would like to continue for a minute, I will not stop him.

[Mr Bone]

Thank you, Mr Weir. Do not encourage me.

The UKHTC costs £1.6 million a year and employs 30 people. Support for victim care, which the Government have increased, costs nearly £2 million a year and services nearly 1,500 people. There seems to be a little discrepancy there. We could take a fraction of that £1.6 million— perhaps, at most, £250,000—and establish a national rapporteur. It would do all the things we want at the fraction of the cost. The Minister could then go back to the Chancellor and say, “By the way, Chancellor, here is £500,000 back that I have found.” I know his career prospects are good, but that would be an added incentive for the Prime Minister.

Three components are required for a national rapporteur to make an effective contribution to combating human trafficking, as opposed to simply writing reports that gather dust: independence from Government; unlimited and direct access to all relevant information, not just Government information; and annual reports that should be made public, with their recommendations debated in Parliament. It is important to keep in mind that, while a report by the national rapporteur on the status of human trafficking is designed to cover the scope of the problem and the changing trends as well as the appropriate responses, it should not lose sight of the ultimate goal: to end this vicious modern-day slavery.

The UK Government’s human trafficking strategy clearly states its main four objectives and how to achieve them. If established in the UK, a national rapporteur could gather and synchronise the information to assess the Government’s progress on its timely and efficient implementation, make recommendations on where more attention and action were needed, and ensure the adequacy and appropriateness of services provided to victims of trafficking.

Another point that was brought to my attention is that the Dutch Government discovered that having a national rapporteur actually helped them. When outside bodies said that the Dutch Government were not doing enough, they could point to the rapporteur’s report and say, “Yes, we are doing the job.”

In conclusion, not only am I being a good European today, and not only am I making the Minister’s life easier—[Interruption.] The hon. Member for Strangford (Jim Shannon) says that there is a first time for everything. Not only am I saving the taxpayer money, but I am arguing for a big step towards ending the evil of human trafficking.

[Michael Connarty (Linlithgow and East Falkirk) (Lab)]

rose—

[Mr Mike Weir (in the Chair)]

I cannot call the hon. Gentleman unless he has the permission of the initiator of the debate and the Minister. Does he have the permission of both?

[Michael Connarty]

A minute of their time.

[Mr Mike Weir (in the Chair)]

But has that been granted?

[The Minister for Immigration (Damian Green)]

indicated dissent.

[Mr Mike Weir (in the Chair)]

I am sorry; I cannot call the hon. Gentleman.

[Michael Connarty]

As vice-chair of the all-party parliamentary group on human trafficking, I find that quite appalling.

16:50

[The Minister for Immigration (Damian Green)]

I am happy to assure the hon. Member for Linlithgow and East Falkirk (Michael Connarty) that I will be generous in allowing interventions, even though I am restricted by time, because I appreciate his contribution and his long-standing interest in this subject.

I congratulate my hon. Friend the Member for Wellingborough (Mr Bone) on making a uniquely Europhile speech, on securing this debate and on his work for the all-party group. I am grateful for his kind remarks, although I am deeply worried when he says that lobbying me is like pushing at an open door. I make it clear to all non-governmental organisations that that should not be taken as precedent.

There is, rightly, a lot of interest in this issue. Everything that my hon. Friend said about its seriousness and the importance of having an effective anti-trafficking strategy is, of course, true. The one point where I would slightly disagree with him, apart from on the central argument—I will come on to why I disagree with him about that—is on the lack of public awareness. It has struck me, over the past few years, not least through the actions of the all-party group, NGOs and successive Ministers in both Governments, that there is consciousness throughout the country of the evil of trafficking and the fact that it is present not just in our inner cities and the sex industry, but in many small communities, including rural communities, and all parts of the United Kingdom, as we have heard. Indeed, it is everywhere. That consciousness has grown in recent years, which is good, because we will be much more effective in fighting trafficking if, out there, the general public knows about it.

In that context, it is fair for me to outline some progress that we have made since we published the human trafficking strategy in July last year, which focuses, as my hon. Friend said, on four key themes: improving victim identification and care; enhancing our ability to act early; smarter action at the border; and more co-ordination of our law enforcement efforts in the UK.

Officials have been working across the Government to build a more collective and collaborative response to fighting human trafficking, bringing in the Foreign and Commonwealth Office, the Department for International Development, the Department for Education and the Department of Health. Equally importantly—I take the point that there must be collaboration between the Government and extra-governmental bodies—this response is specifically supported by stakeholder groups on specific themes, attended by a range of NGOs. The current groups are focusing on five key areas within the strategy: raising public awareness; working with the private sector; working with child victims; tackling demand; and international engagement. Those groups have already instigated action to support the aims of the strategy. For example, they are considering how we can expand the awareness-raising initiative with airlines—something that I helped to launch with Virgin Airlines as part of the activities on the most recent national anti-slavery day.

We have already provided additional information to posts in other countries to raise awareness of trafficking and to support collaborative working with NGOs in those countries. Part of that work includes gathering information from posts, so that we have a better understanding of their challenges and issues to help inform how we might best support anti-trafficking efforts around the world. We recently agreed an awareness-raising campaign with a major supermarket in Lincolnshire to provide information to potential vulnerable workers in the agricultural sector.

Officials continue to review and refine the national referral mechanism to ensure that victims can be identified appropriately and to ensure that the picture on the extent of human trafficking within this country is clearer.

My hon. Friend was disapprobatory about the UK Human Trafficking Centre. Clearly, it can get better and is doing so, but improvements can always be made. That is what we are trying to do in respect of its intelligence function and organised crime group mapping, which will help inform the Government’s view of the priority areas to combat human trafficking.

[Michael Connarty]

I am reminded of the adage that a camel is a horse designed by a committee. On 18 January, the Minister said in his response to the Organisation for Security and Co-operation in Europe’s special representative and co-ordinator for combating traffic in human beings:

“Progress is monitored by a strategic board of cross-Departmental officials which meets on a six-weekly basis. This board reports to the biannual Inter-Departmental Ministerial Group…on human trafficking.”

That seems to be a larger number of people than is required to do a job, which, as the chair of the all-party group, the hon. Member for Wellingborough (Mr Bone), said, is done by a co-ordinator—a proper rapporteur with a single purpose, independent of the Government.

[Damian Green]

Let me move directly on to the central point made by my hon. Friend the Member for Wellingborough about whether we need a rapporteur added to our armoury. Obviously, this matter arises from the directive that we have now opted into. I am grateful to him for his support, not just for our opting in, but for the way that we did it—at the end of the process when had we ensured that it was appropriate and helpful to this country to do so.

We have given much thought to how we implement the directive. We are about to make changes to primary legislation, with amendments to the Protection of Freedoms Bill, to ensure that we are compliant with those parts of the directive to which our laws are not compliant at the moment, and we are making an initial assessment of where we may need to introduce secondary legislation. We are determined to ensure that everything is in place by April 2013, which is when we need to be completely compliant.

Article 19 allows the setting up of a national rapporteur or equivalent mechanism. I am unpersuaded by my hon. Friend’s example. He was mildly humorous about the inter-departmental ministerial group. I think that I am entitled, in return, to note that of the 27 nations in which he could have found examples of people being inspired to greater efforts on anti-trafficking by having a rapporteur, he adduced precisely one. I am disappointed on behalf of Finland, which is the only other country in the European Union that has a national rapporteur. I note that my hon. Friend did not come up with any great advantages from the Finnish system.

[Mr Bone]

On that important point, the Minister is right; of course there are two countries that do it, but the Prime Minister wants—I hope that the Minister would want to support the Prime Minister—to make the UK the leading country in the fight against human trafficking. With a rapporteur, we could take that lead.

[Damian Green]

I share the ambition to make the UK a leading beacon, showing people how we can effectively fight trafficking. So let me get to the point of why I think that a rapporteur would be a fifth wheel on the coach.

The interdepartmental ministerial group, which meets every six months, is effective with support from the UK Human Trafficking Centre, which is the central repository of data—my hon. Friend made that important point—and it can effectively perform the national rapporteur function, because apart from the ministerial meetings, officials from across Whitehall meet once every two months to support the ministerial group, to inform it and to provide an update.

I agree that the current structure is not perfect, and I intend to make some improvements, so that it can become more effective. First, I will consider my hon. Friend’s point about the frequency of the group’s meetings, so that it can maintain effective oversight across the Government of the work on combating human trafficking. Secondly, I will review the group’s membership to ensure that we have the right people in the room discussing the issues across the Government. I recently wrote to group members emphasising the importance of their regular attendance: I take the point that my hon. Friend made in that respect, as well. Thirdly, I will revise the terms of reference for the group to reflect the required functions of the rapporteur role, so that it can effectively assess trends and measure the actions taken to address them.

As part of the existing arrangements, the group receives information on human trafficking trends from the UK Human Trafficking Centre, which informs our approach. If particular issues are raised, the group will be able to commission further data from the HTC. To that end, my officials are working with the centre to establish consistent data requirements to support the group in carrying out that role. In line with the requirements set out in article 19, the group will publish an annual report on the assessment of trends in human trafficking, as well as on anti-trafficking activities, and will work with the NGOs to achieve that.

In recent debates, as well as in this one, questions have been asked about the independence of the ministerial group and about the requirements of the rapporteur role. To be clear, the directive does not stipulate that the national rapporteur or equivalent mechanism must be independent of the Government. Indeed, we already have in the UK a vast array of extremely effective organisations independent of the Government that produce assessments of human trafficking inside the country and internationally. We of course consider proposals and recommendations in each report, and we will strengthen our response accordingly. In carrying out the rapporteur function, the group’s report will not only consider trends but will take account of assessments and recommendations from other reports and of the Government’s progress in delivering their strategy.

To make those pledges concrete, I intend that the group will produce an initial report following the first anniversary of the publication of the strategy, after the Olympic games, to ensure that the progress made on the strategy and any learning or experiences gained from the games can be captured and inform our assessment of such work.

As the problems that might come about because of the Olympics have been brought up, let me say that of course we have a threat assessment of the Olympics, including the possibilities of trafficking. I am pleased to say that, at the moment, there is no evidence of extra trafficking activity as a result of the Olympic games, which would have been intuitively plausible because there has been evidence of trafficking at previous World cups, but they attract a different kind of audience from the Olympics. We are now over the construction phase—the venues are built—which is another time that people were worried about, and I think that the sort of people who attend the Olympics will provide less of an incentive. More to the point, so far the police detect no evidence of any large-scale increase in trafficking activity related to the games.

I thank my hon. Friend for his continuing concern with and commitment to the fight against human trafficking and others present in the Chamber today. The appropriate structures are in place and will get better, and they provide the right oversight in this area. It almost goes without saying, but I can assure hon. Members that the Government continue to recognise the importance of fighting such a terrible crime and ending the plight of far too many vulnerable adults and children. I will bend all my efforts to ensure that we are as effective as possible in continuing that fight.

Question put and agreed to.

17:03

Sitting adjourned.