House of Commons

Thursday 28th June 2012 Commons Chamber

Thursday 28 June 2012

The House met at half-past Ten o’clock

Prayers

Thursday 28th June 2012 Commons Chamber

[Mr Speaker in the Chair]

Oral Answers to Questions

Thursday 28th June 2012 Commons Chamber

The Secretary of State was asked—

[Mr Clive Betts (Sheffield South East) (Lab)]

1. What her policy is on the means-testing of concessionary bus travel for pensioners.

[The Parliamentary Under-Secretary of State for Transport (Norman Baker)]

I believe that you, Mr Speaker, and the Opposition Front-Bench team will know that my ministerial colleague, the hon. Member for Hemel Hempstead (Mike Penning), is unable to be here today as he is abroad at a piracy conference—or, hopefully, an anti-piracy conference.

We have no plans to introduce means-testing to assess eligibility for concessionary bus travel for older people. The right to free bus travel for both older and disabled people is enshrined in primary legislation. In the 2010 spending review, the Government said they will protect the statutory entitlement to concessionary bus travel.

[Mr Betts]

I am pleased the Minister has dropped the Deputy Prime Minister’s ridiculous idea—presumably because he can envisage situations in which a pensioner who qualifies for a pass, under a means test, gets on a bus and produces their pass, and everyone can see that they are poor enough to qualify. We would end up with better-off pensioners not getting a pass because they would be means-tested out, and the poorer pensioners not using a pass because they would be too embarrassed to do so.

[Norman Baker]

I thought the hon. Gentleman might have wanted to congratulate the Government on giving £25 million to South Yorkshire yesterday, or on proceeding with the Rotherham to Sheffield tram-train trial, about which he has been so keen, and which his Government did nothing to advance over so many years.

The Deputy Prime Minister raised no such idea, and I made our position clear to the hon. Gentleman in a letter of 2 April. He is well aware of the Government’s position.

[Maria Eagle (Garston and Halewood) (Lab)]

Before the election, the Prime Minister pledged to keep the free bus pass. We know the Deputy Prime Minister and his Lib Dem colleagues did not agree, and now we learn that the Work and Pensions Secretary wants it scrapped as well. Can pensioners be sure they will not face a means test in order to receive their bus pass, or is this going to be another U-turn the Chancellor has not told the Transport Secretary about?

[Norman Baker]

The hon. Lady clearly does not want to take yes for an answer. I do not know how many times we have to say from the Dispatch Box that the concessionary fares arrangements will not change over the lifetime of this Parliament: end of story.

[Maria Eagle]

After the shambles of the last week, I am not sure that pensioners will be reassured by that commitment. After all, the Transport Secretary began the week by ruling out a U-turn on fuel duty. The fact is that pensioners are being hit now by cuts to bus services, which Age UK and the National Pensioners Convention warn are leading to concessionary bus pass holders having no buses to get on. The Government were right to respond to our call to do something for motorists, but as the Department for Transport has now admitted to under-spending its budget by £500,000—the amount needed to restore bus funding—is it not time to show a similar commitment to public transport and restore the bus cuts?

[Norman Baker]

If I may say so, Mr Speaker, that question strays a long way from the tabled question about concessionary bus passes, and if I were the hon. Lady I would not have asked it, because the latest figures, out this week, show that bus passenger journeys in England increased by 0.6% between 2010-11 and 2011-12. They also show that bus fares outside London fell by 4% in real terms between March 2009 and March 2011. I think that, on this occasion, the Eagle has crash-landed.

[Angie Bray (Ealing Central and Acton) (Con)]

2. What recent assessment she has made of airport capacity in the south-east; and if she will make a statement.

[The Secretary of State for Transport (Justine Greening)]

It will be quite a job to follow the Minister’s last remark.

UK Aviation Forecasts 2011 provides an assessment of how demand for air travel in the UK is expected to change in the future. We will shortly launch a call for evidence to look at how we can tackle that challenge of emerging demand. Let us be clear, however: the coalition agreement stands. This Government cancelled the last Government’s plans for a third runway, and we will be sticking to that.

[Angie Bray]

I thank the Secretary of State for that answer, and I know my constituents will be grateful, too. Does she also agree that talk about expanding Heathrow so it becomes a competitive international hub is wildly misplaced? A third runway would fill up almost at once—and where would a fourth runway go, unless we were to look at possibly knocking down parts of Hounslow and Staines, which I am sure would be entirely unacceptable?

[Justine Greening]

My hon. Friend raises some of the very difficult issues we have already run up against with Heathrow as a hub airport. She also points out that these discussions and decisions matter massively to residents on the ground, and she is right that the question is not just about a third runway at Heathrow—about which we have been very clear—because expanding that airport further would pose significant challenges to local communities, which should be taken extremely seriously.

[Graham Stringer (Blackley and Broughton) (Lab)]

Airport capacity in the south-east has been studied in great detail for the last 50 years, and there is no further information to be found. Is not the reason we are not getting a third runway the deal done between the Prime Minister and Boris Johnson to try to secure votes in west London, as a result of which the entire economy of the United Kingdom is suffering? I believe the Prime Minister wants to do a U-turn on this, and that he will do a U-turn.

[Justine Greening]

I am not sure whether that was actually a question, Mr Speaker, but what I do know is that we need to approach this discussion with maturity and from a long-term perspective. Given how much this decision affects many people, not just in the industry, but on the ground, it is not good enough to have a headline-driven, pub-style debate. What I have called for now is a much longer-term debate to get some answers that are not just right in the next 10 to 15 years, but will be right for the next 50 or 60 years. I very much welcome the fact that companies such as BA and people such as Willie Walsh are now starting to step up to the plate and join that debate. I look forward to their response and those of many others to the call for evidence over the coming months.

[Dr Julian Huppert (Cambridge) (LD)]

Will the Secretary of State confirm that the Government will stand by the whole of the coalition agreement in this area? Will she confirm that they will stand by the cancellation of the third runway at Heathrow, as she has said, will refuse additional runways at Gatwick and Stansted, and will rule out mixed mode at Heathrow?

[Justine Greening]

I think I have been very clear: the coalition agreement, in its entirety, stands. That is the position.

[Fiona Mactaggart (Slough) (Lab)]

I represent a constituency where the people on the ground are affected directly by Heathrow, and welcome the jobs and prosperity that the airport brings them. Will the Secretary of State improve access to Heathrow by investing in improved rail access to it from the west as soon as possible? It is a shovel-ready project—will she deliver it?

[Justine Greening]

I know that the hon. Lady has been very passionate about that project. Indeed, a number of weeks ago I was at a reception on it organised by her and my hon. Friend the Member for Reading East (Mr Wilson). We are looking at it very closely. I have to say that a Westminster Hall debate on rail-air transport links in the south-east took place earlier this week and not one Labour MP turned up to it.

[Steve Rotheram (Liverpool, Walton) (Lab)]

3. What recent assessment she has made of the level of funding for road maintenance.

[The Parliamentary Under-Secretary of State for Transport (Norman Baker)]

The Department is providing £3 billion over four years to 2014-15 to local highway authorities in England for roads for which they are responsible. We also provided £200 million in March 2011 to repair damage caused by the 2010 winter. The Highways Agency is responsible for operating, maintaining and improving the strategic road network in England, and this financial year its maintenance budget is £755 million, excluding costs associated with private finance initiative projects.

[Steve Rotheram]

We know that the coalition’s manoeuvre of choice is the U-turn, so can the Transport Secretary or the Minister continue in that vein by reversing the Department’s decision to cut investment in Britain’s road network by £3.5 billion?

[Norman Baker]

Again, I thought that the hon. Gentleman might have welcomed the £20 million that the Department gave to Merseyside yesterday for investment in local transport projects. I thought he might also have welcomed the fact that in cash terms the Department is providing more for road maintenance over this four-year period than his Government did over the previous four years.

[Miss Anne McIntosh (Thirsk and Malton) (Con)]

May I welcome my hon. Friend’s announcement? North Yorkshire has the second longest rural road network, after Lincolnshire, and the most extreme winter conditions. How can we ensure that we get a fair slice of the extra money that has been announced?

[Norman Baker]

I am happy to say that North Yorkshire also qualified for funding from the Department yesterday to help the Harrogate and Knaresborough sustainable transport package. We continue to fund road maintenance through the standard arrangements from the Department, as I indicated a moment ago.

[Kelvin Hopkins (Luton North) (Lab)]

The requirement for large expenditure on road maintenance arises overwhelmingly from the heavy axle weights of lorries, so is it not sensible to look at schemes for transferring vast volumes of road freight on to rail? Will the Government look seriously at schemes for transporting lorry trailers and lorries on trains throughout Britain?

[Norman Baker]

I entirely sympathise with that question. We are taking steps to improve the amount of freight that can be transported by rail. The rail Minister, my right hon. Friend the Member for Chipping Barnet (Mrs Villiers), is busy activating that. We have improved the gauge from Southampton and the rail line from Felixstowe, and we hope to make further improvements. Of course our high-speed rail plans will free up space on the existing north-south routes.

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

4. What representations she has received on plans to increase the level of ethanol in automotive fuel.

[The Parliamentary Under-Secretary of State for Transport (Norman Baker)]

We have received representations on ethanol from a range of individuals and organisations. Ethanol can currently be blended in petrol up to 5%. I understand an industry standard for a blend of up to 10% is being developed. The Department has asked the Low Carbon Vehicle Partnership to work with consumer groups, vehicle manufacturers and fuel suppliers to plan its introduction to ensure that appropriate safeguards are in place and consumers have clear information.

[Mr Knight]

Is the Minister aware that the Government are absolutely right not to increase the level of ethanol above 5% until we have a better evidence base for its sustainability? Is he also aware—I declare an interest at this point—that there is evidence that ethanol levels above 5% play havoc with older vehicles’ fuel systems, including those of classic and historic vehicles? If we have to go above 5%, will he ensure that the pumps are properly labelled?

[Norman Baker]

I entirely sympathise with my right hon. Friend, who makes an important point. I expect that there is a possibility that the European Commission will review the matter before January 2014, when the requirement for petrol stations to supply a 5% blend officially ends. The UK Government also have a power to require a 5% blend to be supplied beyond that point. In any case, I would expect industry to ensure that a protection grade of E5 will continue beyond that point and I entirely agree with my right hon. Friend’s point about labelling.

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

5. What recent progress she has made on transport infrastructure projects announced in the autumn statement.

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

10. What recent progress she has made on transport infrastructure projects announced in the autumn statement.

[The Secretary of State for Transport (Justine Greening)]

The Government are not just fixing the disgraceful legacy of debt left to us by the Labour party but are also building for our country’s success in future—and that means investing in transport. At the autumn statement we announced £2.5 billion more in transport investment, building on the £30 billion set out in the spending review. An update on the progress made on the priority infrastructure investments identified in the 2011 national infrastructure plan was published alongside the Budget in March.

[Mr Bain]

The debt plan is not going very well, because borrowing has gone up £3.9 billion this year above what it was at the equivalent stage last year. Construction output fell in April by 13% and long-term unemployment is soaring, yet many of the infrastructure plans set out by the Chancellor do not begin until later in this Parliament. Will the Secretary of State tell us what representations she has made to the Chancellor to bring forward infrastructure spending into this financial year and whether she has had any more success with that than she had with her representations on fuel duty?

[Justine Greening]

I do not think this Government need to take any lectures about debt levels from the Labour party. The only problem Labour has with our debt levels is that they are not high enough. Labour Members want more debt to get us out of this debt problem, not less; no wonder they are sitting on the Opposition Benches rather than the Government Benches.

We are absolutely bringing forward transport projects. In fact, in the time that I have been in this role we have announced 42 major road schemes, many of which were sat on the stocks ready to go but had never been approved by Labour. We are getting on with them and bringing forward a number of projects, and we are cracking on with that right now.

[Chi Onwurah]

In his autumn statement, the Chancellor announced that he would bring forward investment in the Tyne and Wear Metro—investment that was originally secured by the previous Labour Government. What he did not say was that that was an accounting sleight of hand that will not lead to one extra metre of track being refurbished or one extra job this year. Now that the Chancellor is for turning, will the Secretary of State listen to Opposition Members and bring forward real plans for infrastructure investment in the north-east to get the economy moving?

[Justine Greening]

The hon. Lady raises an important point about the Metro. We are getting on with that project. As she knows, any transport project, once it gets agreement, needs to follow a number of steps before it is in a position to go ahead. We are pulling forward our investment in the Metro and I hope that the hon. Lady, as someone who represents Newcastle, will greatly welcome that.

[Iain Stewart (Milton Keynes South) (Con)]

Will my right hon. Friend congratulate the east-west rail consortium and the local authorities that have contributed funds that mean that the Bletchley to Oxford and Aylesbury line is in great shape?

[Justine Greening]

I will. It is part of the unprecedented investment that is now going into our Victorian railway network. I believe that the scheme has the potential to make a huge difference, which is why we gave it the green light to go to the next step. I am delighted to see private investment going in alongside public investment and the involvement of local stakeholders and I think that the project will make a huge difference.

[Tim Farron (Westmorland and Lonsdale) (LD)]

Among the projects announced in the autumn statement were the electrification of northern rail links. The Secretary of State will be aware that two of the UK’s most picturesque and economically important lines are the Lakes line to Windermere and the Furness line, which run through my constituency. Neither of them are electrified and both run the risk of losing their direct connection to Manchester airport. Will she meet a small, cross-party delegation to make sure we can fix these challenges?

[Justine Greening]

I would be absolutely delighted to. The hon. Gentleman is right to point out that we are getting on with electrification in a way the previous Government never did. We have already announced several hundred miles of electrification. That is one of the key things I am looking at as we finalise the high-level output specification package, which I will announce shortly. I would be very happy to meet him and his delegation to look at what that means locally and how we can make sure that we can improve his local transport system too.

[Mrs Louise Ellman (Liverpool, Riverside) (Lab/Co-op)]

It is very important that the electrification schemes go ahead according to plan, but does the Secretary of State agree that the northern hub must be funded in full to bring the £4 billion-plus investment and improvement in services across the whole of the north?

[Justine Greening]

There is no doubt that the people supporting the northern hub have made a powerful case. In the past two weeks I have been in Leeds, Manchester and Sheffield and all of them have reiterated to me why this project matters so much. Like the rest of the Government I have to cut my cloth to be able to afford what we are announcing, but we have already taken some important steps on this project. I will be setting out the next steps across the railway network in the HLOS—high level output specification—statement and I have no doubt the hon. Lady will take an interest in what I have to say.

[Mr James Gray (North Wiltshire) (Con)]

People throughout the west country have warmly welcomed the electrification of the Great Western railway line through Chippenham and Bath. They also look forward to the redoubling of the Kemble to Swindon line. Will the Secretary of State look at whether it would be useful to have interchange between that line and the historic Swindon to Cricklade line?

[Justine Greening]

I would be delighted to look at that. I know my hon. Friend has raised this issue before. We are determined to improve connectivity. Looking far longer term, High Speed 2 will do that for many parts of the country and I am determined to make sure that his part of the country continues to get more investment in addition to the Great Western line investment that is already going in and the new intercity express programme trains that will also give him more capacity.

[John Woodcock (Barrow and Furness) (Lab/Co-op)]

But the Secretary of State and the Chancellor need to recognise that announcing something is one thing, but actually doing something about it is completely different. The breakdown of the autumn statement total suggests that only 17% was due to be made in the last financial year. In this year, with the country back in recession, only a further 5% of the total is due to be spent. Regardless of the issues with the level of influence the right hon. Lady has with the Chancellor, can she really tell the House that she thinks this is having sufficient impact?

[Justine Greening]

This Government and our decisions are having a major impact. I do not need to take any lectures or lessons from the Labour party, which had a failed aviation strategy, no rail strategy at all and made absolutely no investment on the roads compared with what we are putting in. Frankly, the brass neck of it is unbelievable. We are getting on with building our country for the future in a way that the previous Government never did. We are investing more and we will do more. I look forward to hearing him congratulate us when we do.

[Mr Speaker]

I hear the Secretary of State’s message but we have a lot of questions to get through.

[Mrs Sharon Hodgson (Washington and Sunderland West) (Lab)]

6. What steps her Department is taking to improve cycling safety.

[The Parliamentary Under-Secretary of State for Transport (Norman Baker)]

Last year I set up the cycling stakeholder forum, which comprises representatives from cycling groups, motoring organisations and local authorities. A sub-group has been established to look specifically at safety issues. Good progress is being made on coming up with ideas and actions to improve cycle safety. Earlier this week I announced a £15 million fund to improve safety for cyclists outside London by tackling dangerous junctions. This is in addition to the £15 million fund awarded to Transport for London in March for the same purpose.

[Mrs Hodgson]

Figures from his Department and independent analysis have shown that more cyclists are killed in collisions with heavy goods vehicles than any other kind of vehicle. Will the Secretary of State therefore stop the trial of longer HGVs that her Department has enacted and give serious consideration to the proposals from the cycling stakeholder forum for a proper plan to improve cyclist safety and to increase cycle use?

[Norman Baker]

I have already referred to the cycling stakeholder forum, which met yesterday and which I attended. We are looking at safety issues very seriously, as the hon. Lady would expect. I do not think it is a question of how long lorries are. The particular issue with HGVs is about lorries turning left and catching cyclists on the inside. That is one reason why I have now given permission for all local authorities across the country to install Trixi mirrors to pick up those manoeuvres. It is also why the Under-Secretary of State for Transport, my hon. Friend the Member for Hemel Hempstead (Mike Penning), is looking at issues relating to the information available to the driver in the cab.

[Mr Dominic Raab (Esher and Walton) (Con)]

7. What steps she is taking to invest in road infrastructure.

[The Secretary of State for Transport (Justine Greening)]

The 2010 spending review committed investment of £2.3 billion for major road improvements over the next four years. We also committed to investment of £614 million towards local road projects. The 2011 autumn statement provided a further £1 billion investment for strategic roads.

[Mr Raab]

I thank the Secretary of State for that answer. Surrey pays more revenue to the Exchequer than any part of the country outside London, but it has the third-worst roads and, taking traffic volumes into account, gets the second-lowest funding of all counties for highways maintenance. What steps is she taking to repair and maintain Surrey’s roads so that the county can continue to generate high revenue for Britain?

[Justine Greening]

I agree that is important. Actually, the latest statistics published by the Department suggest that Surrey road conditions are slightly higher than average. Of the 117 local authorities where we allocate highway maintenance funding, Surrey falls into the top 15 and we are providing £61 million. In addition, my hon. Friend will know that we are focused on important schemes; we are providing £24 million towards the Walton bridge scheme that is now under construction. We are willing to put in that investment, and it will make a big difference on the ground.

[Derek Twigg (Halton) (Lab)]

Roads are a very important part of any sustainable transport structure. Unfortunately, the Secretary of State turned down Halton’s bid for a sustainable transport fund, and I am in correspondence with the Under-Secretary of State for Transport, the hon. Member for Lewes (Norman Baker), on the issue. Can the Secretary of State confirm whether any other area has been asked to rework and resubmit its bid? If so, can she tell me why it has, but not Halton?

[Justine Greening]

We had a rigorous process for looking at all the bids; they were considered by a panel of experts that we appointed. Some of the bids were modified in the light of the reaction of the independent panel, and we took our investment decisions on that basis.

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

8. What progress she has made on her review of the use of brown tourist signs.

[The Parliamentary Under-Secretary of State for Transport (Norman Baker)]

The review of brown tourist signs is making good progress and we expect to publish our findings later this year. We are currently reviewing stakeholder comments on the existing requirements so that a package of options and a recommendation can be presented to Ministers.

[Julian Smith]

I am glad the Minister shares my passion for brown signs, but can he assure me that the Highways Agency will work much more closely with business before removing brown signs? The agency was reckless in removing the sign on the A1 upgrade in Masham. Would the Minister like to join me for a pint of Theakston’s or Black Sheep so that he can see the evidence for himself?

[Norman Baker]

My colleague, the Under-Secretary of State for Transport, the hon. Member for Hemel Hempstead (Mike Penning), might take that pint rather than me, although I am always happy to have a pint of Theakston’s—or anything else for that matter.

I agree that early involvement with business is helpful and desirable, and I congratulate my hon. Friend the Member for Skipton and Ripon on the work he has done on the issue. I know that my colleague, the hon. Member for Hemel Hempstead, wrote to him about it last week, and has challenged the Highways Agency to minimise the cost of the signs, including by engaging with local contractors and interest groups such as those my hon. Friend the Member for Skipton and Ripon refers to.

[Robert Halfon (Harlow) (Con)]

rose—

[Mr Speaker]

Order. We now come to question 8— [Interruption.]—or even 9.

[Robert Halfon (Harlow) (Con)]

9. What steps she is taking to support motorists and the haulage industry; and if she will make a statement.

[The Secretary of State for Transport (Justine Greening)]

I have taken a number of steps to reduce motorists’ costs. We are working with the Ministry of Justice to tackle the cost of insurance fraud, including fraudulent whiplash claims. We are working with the fuel industry to ensure the transparency of fuel costs and that wholesale price reductions are passed on. We have halved the tolls on the Humber bridge. We are working with the Motorists Forum on improving garage experiences for consumers, and as well as freezing fees for MOTs, driving tests and licensing, in the logistics growth review we supported £1 billion of further investment to improve the capacity and resilience of the strategic roads network.

[Mr Speaker]

We knew it would be worth waiting for.

[Robert Halfon]

Thousands of hard-pressed motorists, and me, are so excited that the Government cut fuel duty this week that I lost my train of thought as another Labour tax rise was cancelled.

I thank the Secretary of State for her outspoken support and for the pressure she has put on oil companies to bear their share of responsibility for the high price of petrol and diesel at the pumps. Will she carry on putting that pressure on oil companies to ease the pressures on motorists?

[Justine Greening]

I very much welcome those comments. The Government are working hard across the board, in both the Department for Transport and, of course, the Treasury, to make sure that we keep the cost of motoring as low as possible. In fact, the AA says that Tuesday’s delay to the fuel duty increase, today’s announcement, and my call for fuel price transparency have

“placed this government at the forefront of looking out for the interests of drivers, business and families.”

I really welcome that, and we will continue to work hard on behalf of motorists.

[Philip Davies (Shipley) (Con)]

11. If she will make an assessment of the level of congestion on roads in Shipley constituency.

[The Parliamentary Under-Secretary of State for Transport (Norman Baker)]

The Department for Transport purchases journey time data from the Trafficmaster satellite navigation fleet tracking and traffic information service, and provides it, free, to west Yorkshire’s local authorities. The data can be used to make assessments of road congestion in their areas. It is for the local highway authority—in this case, the city of Bradford metropolitan district council—to make any such assessment.

[Philip Davies]

Shipley constituency has some of the most congested roads not only in the Bradford district, but across west Yorkshire. Not least among those is the road between Baildon and Shipley. A Shipley eastern relief road would not only help local residents with that congestion but give a stimulus to economic growth across the Bradford district. What can the Minister do to ensure that that kind of scheme gets a share of the funding that his Department is giving out?

[Norman Baker]

My hon. Friend is assiduous in making the case for his constituents, and I understand why he puts the case for the road he mentioned. As part of the localism agenda, we consulted earlier this year on proposals to devolve funding for major local authority schemes for the period after 2015, so it will be for the new local transport body covering west Yorkshire to decide the priorities for available funding, and of course to involve the local enterprise partnership—Leeds city region LEP. That is the direction of travel that I recommend to my hon. Friend.

[Greg Mulholland (Leeds North West) (LD)]

The area north of Leeds and Bradford does indeed have some of the most congested roads in the country; that is a problem that is shared cross-constituency. When will we get a decision on the Leeds trolley bus scheme, which will help in that corridor?

[Norman Baker]

The Secretary of State and I are actively considering that matter at the moment. My hon. Friend the Member for Leeds North West (Greg Mulholland) will understand that we are talking about cutting-edge technology, as there is no such scheme already in this country, so we have to be very careful in our assessment of the proposal, but we hope to make a decision very shortly.

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

12. What steps her Department has taken to publicise the consultation on the combined Thameslink, Southern and Great Northern franchise.

[The Minister of State, Department for Transport (Mrs Theresa Villiers)]

The Thameslink consultation was published on 24 May 2012 on the Department’s website. On the same day, I wrote to the relevant MPs and a press notice was issued. On 13 June, Department for Transport officials wrote to MPs and local councils, further publicising the consultation document and details of the upcoming consultation events.

[Tom Brake]

I thank the Minister for her response. May I encourage her, the bidders, Network Rail, London TravelWatch and Passenger Focus to redouble their efforts to raise awareness of the franchise renewal process and, in particular, the implications for Sutton residents, who may find that the through-trains from which they have benefited for many years stop short of Blackfriars, cutting their access to north London and Crossrail?

[Mrs Villiers]

My right hon. Friend will appreciate that extensive advertising budgets are a thing of the past in the age of austerity, but we will do our very best to make sure that people are aware of the consultation. We are aware of his concerns about the Wimbledon loop; my hon. Friend the Member for Wimbledon (Stephen Hammond) barely gives me a moment’s rest on the issue. Network Rail has concerns about operational issues at Blackfriars, but those are not impossible to surmount. No final decisions have been made. We will consider all the representations on the Wimbledon loop and on all relevant matters in response to the consultation.

[Heidi Alexander (Lewisham East) (Lab)]

Page 28 of the Minister’s consultation document states that future Thameslink services may serve Sevenoaks as well as Dartford and Orpington. Will the rail Minister confirm that, if those services go ahead, they will include a stop at Lewisham, and will be in addition to, and not a replacement for, existing services that run from that station?

[Mrs Villiers]

As I have said, no final decisions have been made on what goes into the ultimate franchise; that is what the consultation is all about. I will make sure that the hon. Lady’s representations are properly considered when the consultation closes.

[Joseph Johnson (Orpington) (Con)]

Now that the consultation on rail decentralisation is drawing to a close, will the Minister or the Secretary of State devolve responsibility for south-eastern suburban rail services to city hall as a matter of urgency, so that it can drive up standards on the south-eastern suburban networks in exactly the same way as it did with London Overground?

[Mrs Villiers]

This is an important issue. We are interested in ways of devolving more decision making about our railways, so that it is closer to the local communities served, but we have to make sure that we take into account the interests of all users of relevant rail services, whether they are within or outside the London boundary. We will make an announcement in due course on the results of our consultation on the decentralisation of rail decisions.

[Mr Philip Hollobone (Kettering) (Con)]

13. What consideration she is giving to the reintroduction of double-decker trains on the rail network.

[The Minister of State, Department for Transport (Mrs Theresa Villiers)]

A report prepared by Network Rail in 2007 concluded that the introduction of double-decker trains on the current UK rail network would require extensive modification to structures and stations and was not economically viable.

Although such trains operate in a number of European countries, the larger loading gauge used in continental Europe allows the use of taller, wider trains than is possible in the UK.

[Mr Hollobone]

Other nations seem to make a success of having double-decker trains, and we used to have them on some suburban services in this country. I urge my right hon. Friend the Minister to ask Network Rail to think again, because lots of commuters on congested trains would want us to replicate the success of double-decker buses by having double-decker trains.

[Mrs Villiers]

I welcome my hon. Friend’s interest in this issue, and I have looked at it. The reality, however, is that double-decker trains that were run in the past by British Rail were claustrophobic, it took a long time for passengers to get on and off, and they deployed the sort of slam-door stock that we have tried to phase out. The shape of the UK rail network, the size of the bridges, the distance between rail tracks and the distance between the tracks and the platform mean that we cannot run the large double-decker trains that work in Europe. I am afraid that there are much more cost-effective ways to expand capacity, with longer trains and more frequent services, which is what the Government are doing.

[Mr Peter Bone (Wellingborough) (Con)]

14. What her policy is on the issuing of renewal notices for driving licences.

[The Secretary of State for Transport (Justine Greening)]

If the photograph on a driver’s licence needs to be renewed, the Driver and Vehicle Licensing Agency sends a renewal notice 56 days before the licence expires. If the licence needs to be renewed because the driver has reached the age of 70 or has a shorter-period licence due to a medical condition, the renewal notice goes out 90 days before the licence expires.

[Mr Bone]

Someone close to my heart had a driving licence that expired, and did not receive such a notice. Mrs Bone is following Transport questions closely, so would it not be helpful—there must be tens of thousands of people who are driving with expired licences—to include on the licence, in clear, large print, the expiry date?

[Justine Greening]

My hon. Friend makes a perfectly reasonable point. Holders of a photocard driving licence are required by law to renew the photograph on the licence every 10 years so that it remains a good likeness of the driver. I take his points on board—I absolutely do not want to see drivers caught out—and, as he is aware, we are looking more broadly at how we can make sure that our driving licence works well for motorists, not least investigating when we can begin to put the country’s flag on it for a change.

[John Pugh (Southport) (LD)]

T2. If she will make a statement on her departmental responsibilities. Is this topical question 2 or topical question 1, Mr Speaker?

[Mr Speaker]

It is still T2, but we are grateful to the hon. Gentleman. Mr Sheerman has withdrawn his question T1.

[The Secretary of State for Transport (Justine Greening)]

It has been a busy couple of months in the Department for Transport. We have announced our plans to work with petrol retailers to get a better deal for motorists at the pump. We have helped local authorities to unlock economic growth with our £266 million local sustainable transport fund announcement. We have set out the next steps for attracting greater investment in the strategic road network, issuing rail franchise consultations on the inter-city east coast and south-eastern franchises. With other Government Departments, we are working extremely hard to put in place the final planning and preparations to make sure that we host a fantastic Olympic and Paralympic games this summer.

[John Pugh]

I thank the Minister for the additional £20 million for Merseyside Transport. Without wishing to appear ungrateful, what is happening to the appalling rolling stock on the northern franchise, which is wholly unsuitable, particularly on the Southport-Manchester link?

[Justine Greening]

There is a significant piece of work under way to look at what we can do to improve rolling stock across the network, including looking at what additional new rolling stock we need, and how the existing rolling stock can cascade to improve services for others on the line. I have no doubt that my right hon. Friend the Minister of State, who is responsible for railways, is listening closely and will look into the issues that he has just raised.

[Jim Fitzpatrick (Poplar and Limehouse) (Lab)]

I understand that the road casualty figures for 2011 were published this morning and, sadly, show the first increase since 2003 in deaths and serious injuries. Road casualty reduction targets commanded cross-party support for nearly three decades and played a big part in sending a strong message from Government about how committed they were to reducing deaths and serious injuries on our roads. Those targets were scrapped by the Secretary of State’s predecessor. Is she prepared to revisit that decision? Many in the road safety sector felt that that was a mistake, and the figures this morning tend to suggest that bringing back targets would help in the battle to reduce deaths and serious injuries.

[Justine Greening]

I can assure the hon. Gentleman that as far as I am concerned, one accident is too many. The figures are disappointing. We are concerned to make sure we improve our road safety record. Many of the things that we are doing, including managed motorways, can help with that. I think he is wrong to draw too many conclusions from the latest figures, because we know that we had some exceptional weather in that period. That is one of the reasons why there was such a change, but I am happy to look at what we can continue to do to work with all sorts of stakeholders to improve road safety. It is an issue that this Government take incredibly seriously.

[Dr Julian Huppert (Cambridge) (LD)]

T3. The latest figures from Sustrans show a 40 million increase in the number of cycling trips in 2011 compared with 2010—a very welcome 18% rise. I and many others, including British Cycling, welcome the funding that has been provided by the Government, particularly most recently the £15 million that has been provided towards dangerous junctions around the country, a key feature of the safer cycling campaign in The Times. What steps is the Secretary of State taking to make sure that local authorities match this money to do even more work on more junctions, rather than ducking their responsibilities when the Government step up?

[The Parliamentary Under-Secretary of State for Transport (Norman Baker)]

I am grateful to my hon. Friend for this support for our measures, which include large sums of money allocated yesterday through the local sustainable transport fund, which will also benefit cycling. The sum of £50 million will be available to local authorities on a match-funding basis. We are encouraging them to contribute, and the more they contribute, the more likely it is that they will be successful in securing money from the Government for their dangerous junctions.

[Andrew Gwynne (Denton and Reddish) (Lab)]

T9. Following last week’s publication of the east coast franchise, does the Minister think passengers on the east coast should expect an eye-watering 8% above inflation fare increase, which my constituents travelling on the west coast main line will face in years ahead?

[The Minister of State, Department for Transport (Mrs Theresa Villiers)]

This Government are determined to get the cost of running the railways down. That is the way we deal with the concerns that passengers have about fares. If the Opposition think concerns about fares started in May 2010, they are living on another planet. We need reform to get the costs down so that we can respond to passengers, and it is time Labour started producing its own reform plans if it insists on rejecting ours.

[Andrea Leadsom (South Northamptonshire) (Con)]

T4. My right hon. Friend is aware that I have had constituents in tears in my advice surgeries who are blighted by the HS2 project and trapped in their homes, unable to sell them. Can she reassure my constituents that she is determined to make sure that no private home owner has to pay with the value of their home for the project? What update can she give us on the consultation to get a decent, fair compensation scheme in place?

[The Secretary of State for Transport (Justine Greening)]

I know that the High Speed 2 line is already causing uncertainty for many individuals, communities and businesses that will be affected along the route. We have introduced the exceptional hardship scheme. As my hon. Friend knows, I am about to have a meeting later today to talk to some of the key stakeholders, including herself, about their concerns. Having listened to many concerns and looked at the effectiveness of the exceptional hardship scheme, we are drawing up long-term proposals for compensation, and we will be consulting on those very shortly.

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

On that point, does the Secretary of State agree that one of the best ways of ending the uncertainty is to reach a quick decision? Will she confirm that the Government will introduce legislation on HS2 in the coming Parliament, and that she continues to have the full support of the Chancellor and the Prime Minister in taking forward HS2, which is so vital not just for England, but for Scotland?

[Justine Greening]

The short answer to the hon. Gentleman’s question is yes. We are planning to introduce the hybrid Bill. HS2 is vital for the long-term success of this country.

[Jo Swinson (East Dunbartonshire) (LD)]

T5. Following on from that question, given the Government’s vision for a truly national high-speed rail network extending to Scotland, I welcome my right hon. Friend’s meeting with the Scottish Transport Minister. Will she continue to work very closely with the Scottish Government on the project, not least to ensure that any short-term rail improvements, such as the Edinburgh-Glasgow electrification, can be done in a way that is compatible with future high-speed rail?

[Justine Greening]

I found my meeting with the Scottish Government extremely helpful, and I am keen to work with them on their plans for high-speed rail north of the border. Obviously, they will have to look at the rest of their investment plans in the meantime. That discussion is under way and we will pursue it over the coming months.

[Ian Austin (Dudley North) (Lab)]

If we are to make real improvements in cycling, we must ensure that it is considered properly as part of all decisions and policies on road use, so will the Minister consider the Cycle Stakeholder Forum’s proposal to add a mandatory risk assessment and consultation on cycling to every policy review that affects road users? That would have no cost implications but would make a real difference to transport policy and would show that the Government consider cycling a key part of transport policy.

[Norman Baker]

The Cycle Stakeholder Forum is producing some useful suggestions and doing some good work. The process that is under way means that all its suggestions will be properly assessed by the Department, and we will respond to those in detail later this year.

[Neil Carmichael (Stroud) (Con)]

T6. Following the very welcome news that we have ended Labour’s fuel duty, may I ask the Secretary of State whether she will continue to promote the use of alternative fuels in heavy haulage lorries, as practised by Downton and Howard Tenens in my constituency?

[Justine Greening]

We are very keen to do that. In fact, my hon. Friend might be aware that we have started the low-carbon truck demonstration trial, which now involves £10 million of funding for investigating how we can encourage haulage companies to operate in a lower carbon way. He mentioned the fuel duty impact. Actually, hauliers will be about £4,900 better off on average. The Labour party is interested in carping, but the reality is that we are delivering for people on the ground in a way that it never did.

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

The big society pervades every Government Department. What is the Secretary of State’s definition of the big society?

[Justine Greening]

It is people stepping up to the plate and seeing what they can do to help their local community. We are very good at doing that in times of crisis, particularly in places such as London, but I think that we should be doing it every day of the week. That is what it is about.

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

T7. Helicopter flights cause significant noise disturbance for people living under flight paths and they also benefit from reduced fuel taxes. Will the Minister look at schemes such as those adopted in Paris and Los Angeles to tackle helicopter noise and also look at the unfair tax advantage that helicopter operators have?

[Mrs Villiers]

My right hon. Friend will appreciate that fuel duty is a matter for the Chancellor. We do appreciate the irritation that helicopter noise can cause—anyone who works in this building gets irritated by them buzzing overhead so often—and will consider it as part of our consultation on a sustainable framework for UK aviation.

[Jonathan Edwards (Carmarthen East and Dinefwr) (PC)]

Like many Members, I eagerly await publication of the high-level output specification and the statement of funds next month. As matters stand, Wales would see electrification only of our rail network to Cardiff, compared with electrification of 40% of UK railways and the electrification of the Glasgow to London route in 1974. I invite the Department to make up for this historical injustice by including electrification of the valleys network, the north Wales coast line and the main line to Swansea?

[Justine Greening]

I can assure the hon. Gentleman that the Government are looking closely at what we can do to improve the railway system in Wales. He will have to wait for the HLOS statement itself, but I am absolutely determined to ensure that we see investment go to all parts of the country. It is a key part of what the Government want to do—rebalance the economy—and that absolutely includes Wales.

[Dr Sarah Wollaston (Totnes) (Con)]

T8. The Dutch now have two thirds of their minor rural road network covered by speed restrictions of 40 mph approximately, as they found those even more effective than 20 mph approximately zones in urban areas. Will the Minister please confirm that he will take this evidence into account when drafting the forthcoming guidance on setting speed limits and set out what other measures should be taken to protect rural cyclists?

[Norman Baker]

I am happy to confirm that the Department is giving local councils much more freedom in how they use the road network, including the classification of roads and the speed limits that are set. I hope that my hon. Friend will be aware of the extra freedom for 20 mph limits, in particular. Her point on 40 mph limits is well made and I will ensure that my fellow Transport Minister, my hon. Friend the Member for Hemel Hempstead (Mike Penning), is made aware of her comments when he returns.

The Minister for Women and Equalities was asked—

[Mr Speaker]

Gerry Sutcliffe? Not here.

[Gemma Doyle (West Dunbartonshire) (Lab/Co-op)]

2. What assessment she has made of the cumulative effect of welfare reform legislation on disabled people.

[Nia Griffith (Llanelli) (Lab)]

5. What assessment she has made of the cumulative effect of welfare reform legislation on disabled people.

[The Parliamentary Under-Secretary of State for Work and Pensions (Maria Miller)]

The Government consult fully with stakeholders on the impact of policy changes and produce robust equality impact assessments, as required by the Equality Act 2010 and its predecessor, the Equality Act 2006.

[Gemma Doyle]

I am sure the Minister will be aware of Scope’s recently published report, which labels the Government’s impact assessments as wholly inappropriate when applied to one reform at a time. Does she accept that, unless the impact of welfare reform is considered cumulatively, the human cost of her Government’s austerity measures will be completely overlooked?

[Maria Miller]

I understand the hon. Lady’s point, but she knows that neither the Institute for Fiscal Studies nor the Treasury have a methodology to assess such impacts in the way she describes, but I remind her that we have impact assessments and equality assessments for every policy in order to ensure that all the changes that we make benefit the people whom we are trying to support.

[Nia Griffith]

The Government’s Welfare Reform Act 2012 will force families to make children with disabilities share a bedroom with their siblings, regardless of the difficulties and disruption that that may cause. Will the Minister prevail upon colleagues in the Department for Work and Pensions to look again at the issue before the 2012 Act is fully implemented, to show some compassion and to let disabled children have a bedroom of their own, where necessary, instead of wasting Government money pursuing a case in the Supreme Court on the issue?

[Maria Miller]

The hon. Lady is right to make sure that we have the right provision to support families in our communities, particularly those with disabled people, and that is why we have made sure that local budgets and funding are available to local authorities so that they can make such discretionary payments. Every family situation is different, and we need to take those differences into account.

[George Hollingbery (Meon Valley) (Con)]

Can my hon. Friend tell the House whether a care component will be built into universal credit, whether it will be subject to work conditionality, whether carer’s allowance will be assessed within universal credit, and whether households in receipt of disability living allowance and personal independence payment will be subject to the benefits cap?

[Maria Miller]

My hon. Friend got a lot of detail into that question, and he will know that we have looked at the issue very carefully. Disability living allowance will not be included in the benefit cap, and importantly we intend to raise the equivalent in universal credit of employment and support allowance from £32.25 today to about £77 in future, ensuring that it includes more support for those who cannot go to work.

[Jo Swinson (East Dunbartonshire) (LD)]

9. When disabled people are wrongly found fit for work, it causes a great deal of distress, and of course it is costly to have unnecessary appeals. So the falling rate of successful work capability assessment appeals is welcome and shows some improvement, but three out of 10 being wrongly found fit for work is still too high a figure. What more can the Government do to improve the process, particularly in terms of applying sanctions to Atos when it gets an assessment wrong, so that we can get more decisions right first time?

[Maria Miller]

My hon. Friend is absolutely right to want to drive through more good decision making in that process, and we are doing so across the board by working with Atos to make sure that it adheres to the contracts we have with it, and through the changes that we are making as a result of the Harrington reports, but importantly mandatory reconsideration, which begins in April 2013 for all decisions on benefits, will ensure that more decisions are right first time.

[Kate Green (Stretford and Urmston) (Lab)]

The Government say that their welfare reforms are intended to enable more disabled people to get into work, but a case has been raised with us about a young man who is a wheelchair user, had been desperate to work, found a job but had to turn it down because he would have needed to move and could not find affordable adapted housing. Why are the Government delaying the reasonable adjustment provisions that would help such people to work?

[Maria Miller]

The hon. Lady will know that we have a broad range of support available for people such as the gentleman she refers to through the access to work scheme, for which we are increasing funding by about £15 million over the spending review period, and through local housing payments, such as the one I referred to in a previous answer, in order to ensure that local authorities have the flexibility to support such individuals, so that they can get into work and stay in work.

[Jessica Lee (Erewash) (Con)]

Will my hon. Friend commend the work of disabled people’s user-led organisations, particularly the Outlook centre in Long Eaton in my constituency, which I visited last week? The parent of a service user told me that they were doing a passport renewal form for their daughter and were not happy about having to complete the children’s section of the form for her because, although she is 40 years old, she has learning difficulties. They felt that this was inappropriate. Will my hon. Friend kindly look into the matter?

[Maria Miller]

We can of course look into the detail of the point that my hon. Friend raises. She is absolutely right also to highlight the very valuable work of user-led organisations such as the Outlook centre, which can provide bespoke support for families who are dealing with benefit claims or other issues to do with their loved ones’ lives. That is why we have launched a significant programme to try to expand and support more user-led organisations up and down the country in doing similar work in all our communities.

[Andrew Selous (South West Bedfordshire) (Con)]

3. How many people have continued to work as a result of the abolition of the default retirement age.

[The Minister of State, Department for Work and Pensions (Steve Webb)]

The Government’s impact assessment estimates that after one year about 6,000 people will have continued in work as a result of removing the DRA—in other words, between 4% and 7% of employees aged 65 or over.

[Andrew Selous]

Does my hon. Friend agree that older workers enable knowledge and skills to be transferred from one generation to the next, and that putting a “best before” date on workers was unacceptable discrimination that this Government have justly got rid of?

[Steve Webb]

My hon. Friend is right. One of the lasting legacies of this coalition will be that, after years of its being talked about, we finally abolished age discrimination in the workplace. To give him an example, research has found that McDonald’s restaurants that employ people over 60 have, on average, far higher customer satisfaction than those that do not.

[Fiona Mactaggart (Slough) (Lab)]

Is the Minister aware that the experiences of men and women who work beyond retirement age are very different? Nearly two thirds of those who work beyond retirement age are women, and of those most—nearly two thirds—work in lower-skilled jobs, whereas, in contrast, the smaller group of men are working in higher-skilled jobs. What is he going to do about dealing with the poverty of women in old age?

[Steve Webb]

The hon. Lady is right. Successive Governments have failed to deliver an adequate pension to women. That is why we are reforming the state pension, as the Prime Minister confirmed on Monday, to deliver a pension that is simple, decent and, in particular, treats women fairly for the first time.

[Jackie Doyle-Price (Thurrock) (Con)]

6. What steps she has taken to ensure that the criminalisation of forced marriage does not discourage victims from bringing complaints forward.

[The Secretary of State for the Home Department and Minister for Women and Equalities (Mrs Theresa May)]

Forced marriage is a hidden problem, and criminalising this abhorrent act will give victims the option of seeking the toughest form of justice. To ensure that victims and others are not discouraged from coming forward, civil remedies will remain available to them. We are also providing a package of support to ensure that victims know what help is available, and we are better equipping practitioners to deal with cases of forced marriage more effectively.

[Jackie Doyle-Price]

I thank my right hon. Friend for her answer. However, victims will clearly be intimidated in reporting family members who are committing these crimes. What more can be done to encourage other family members and potential witnesses to report the crimes, and what more can she do to raise awareness that this practice will not be tolerated?

[Mrs May]

My hon. Friend raises an extremely important point. We have retained the twin-track approach of the criminalised route or the civil remedy route precisely because of a concern about those who may not want to report people because of the criminalisation aspect. Raising awareness is incredibly important. That is why we are putting in place a support package, working with practitioners to help them to identify the signs that somebody might be about to be taken away for a forced marriage. We are also going to run a summer awareness campaign aimed at young people so that they understand the signs as regards not only something that might happen to themselves but what is happening to their friends, and are more willing to come forward.

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

7. What assessment she has made of the potential effect of recent labour market trends on black and minority ethnic communities.

[The Minister for Equalities (Lynne Featherstone)]

Tackling unemployment is a priority for this Government. Our approach is to support people according to their individual needs and circumstances rather than segregate them according to ethnicity. That is why we have introduced personalised support through the Work programme, the youth contract, and the Get Britain Working measures. The significantly increased flexibility that we have given to providers and Jobcentre Plus means that interventions can be tailored to address an individual’s specific needs.

[Thomas Docherty]

Given, however, that 44.4% of economically active 16 to 24-year-old black people are without work, compared with just 20% of white people, is not this policy not working?

[Lynne Featherstone]

The hon. Gentleman raises the issue of the number of young black men who are out of work. However, the recent press coverage gave inaccurate figures. Figures from the Office for National Statistics show that less than a third of black men aged 18 to 24 are unemployed. The Government recognise that that figure is still too high, which is why we have introduced tailored and personalised support to help people get back into the labour market.

[Claire Perry (Devizes) (Con)]

The whole House recognises the difficulty of getting certain groups of people into work. Does the Minister agree that payment by results is the way to ensure that the right level of resources is targeted at those who are hardest to help?

[Lynne Featherstone]

My hon. Friend highlights exactly the right point. Work programme providers are encouraged by payment by results, which means that when a young black man comes in, the providers will not get paid unless they remove the barriers that are prohibiting him from getting work, whether through education, training, skills or whatever else.

[Yvette Cooper (Normanton, Pontefract and Castleford) (Lab)]

Is not the fact that young black men are still being hit hardest of all by the Government’s economic failure? Should not the Equalities Minister commit to publishing a full audit of what is happening to young men from different BME backgrounds and the impact that that is having? The latest figures show that unemployment among young white men has gone up by three percentage points since the election, and among young black men by 14 percentage points. There is currently no targeted support for young black men in getting apprenticeships, and the Work programme clearly is not working. Faced with this growing crisis, will Ministers now take serious action to provide the support for jobs and opportunities that young people from all backgrounds need, and consider a bankers’ bonus tax so that they can do so?

[Lynne Featherstone]

The Work programme introduces the conditions that will get young black men into work. That is something that never happened under the Labour Government. The number of people from ethnic minorities who are in work is up by 179,000 compared with 2010. Moreover, on the issue of BME apprenticeships, which the right hon. Lady raised, 2010-11 saw the highest ever percentage of BME apprentices start their training. The labour market trend for the number of people starting apprenticeships has gone up significantly in recent years, from 167,000 in 2003 to 457,200 in 2010-11. We are doing what Labour failed to do.

[Jim McGovern (Dundee West) (Lab)]

8. What recent discussions she has had with her ministerial colleagues on unemployment levels in black and minority ethnic communities.

[Lynne Featherstone]

I refer the hon. Gentleman to the reply that I gave some moments ago.

[Jim McGovern]

Following on from what has been said, black and ethnic minority people seem to figure higher in the unemployment figures in Scotland. Has any of the Ministers present discussed this matter with any Minister in the Scottish Government?

[Lynne Featherstone]

We work closely with the Scottish Government on this issue. As I said, I refer the hon. Gentleman to the answer that I have given. We have put in place a Work programme that will deliver results; Labour never did.

Business of the House

Thursday 28th June 2012 Commons Chamber

11:33

[Ms Angela Eagle (Wallasey) (Lab)]

Will the Leader of the House please give us the business for next week?

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

The business for next week will be:

Monday 2 July—Motion to approve Ways and Means resolutions relating to the Finance Bill, followed by remaining stages of the Finance Bill (day 1).

Tuesday 3 July—Conclusion of remaining stages of the Finance Bill (day 2).

Wednesday 4 July—Estimates day (1st allotted day). There will be a debate on the work of the UK Border Agency, followed by a debate on UK-Turkey relations and Turkey’s regional role.



Further details will be given in the Official Report.



[The details are as follows: There will be a debate on: UK-Turkey relations and Turkey’s regional role: 12th report from the Foreign Affairs Committee of Session 2010-12, HC 1567, and the Government response thereto, CM 8370.]

At 7 pm the House will be asked to agree all outstanding estimates, followed by a motion to approve a statutory instrument relating to terrorism.

Thursday 5 July—Proceedings on the Supply and Appropriation (Main Estimates) Bill, followed by debate on a motion relating to VAT on air ambulance fuel payments, followed by debate on a motion relating to the public administration Select Committee’s recommendation for the Prime Minister’s adviser on Ministers’ interests to be empowered to instigate his own investigations.

Friday 6 July—Private Members’ Bills.

The provisional business for the week commencing 9 July will include:

Monday 9 July—Second Reading of the House of Lords Reform Bill (day 1).

Tuesday 10 July—Conclusion of Second Reading of the House of Lords Reform Bill (day 2).

Wednesday 11 July—Debate on a motion relating to the sitting hours of the House of Commons. The subject for that debate has been nominated by the Backbench Business Committee. Following that, the Chairman of Ways and Means is expected to name opposed private business for consideration.

Thursday 12 July—Motion relating to the reform of the Court of Justice of the European Union, followed by a motion on a European document relating to the EU draft budget, followed by a motion on a European document relating to EU human rights strategy.

Friday 13 July—Private Members’ Bills.

I should also like to inform the House that the business in Westminster Hall for 5 July will be a debate on PIP breast implants and regulation of cosmetic interventions, followed by a debate on adoption.

[Ms Eagle]

The right hon. Gentleman has announced for next week a debate on a Backbench Business Committee motion on giving the adviser on the ministerial code the power to initiate an investigation rather than waiting for the Prime Minister to ask for it, which this Prime Minister has been remarkably reluctant to do. Will the Government accept the decision of the House on this matter?

The revelations that Barclays bank engaged in “widespread” market manipulation to maximise its profits are truly shocking. There are suggestions that other banks were also involved in rigging the LIBOR and EURIBOR rates. I know the Chancellor will make a statement after business questions, but does the Leader of the House agree that such behaviour is “morally repugnant”?

Yesterday, the Deputy Prime Minister published the House of Lords Reform Bill. The Opposition welcome this legislation. I have always voted for an elected second Chamber and look forward to doing so again, this time with Conservative Back Benchers joining us in the Division Lobby. When the Labour Government took through legislation to remove hereditary peers—a simple six-clause Bill—there were nine days of debate. Why are the Government planning to offer little more debate on the House of Lords Reform Bill, which is a much bigger and more complex piece of legislation? The Leader of the House is fond of saying that the House is not a legislative factory. The Queen’s Speech was short of Bills; time is not a problem. Will he undertake to arrange future Government business to ensure that Members have sufficient time to scrutinise that important Bill?

I can understand Conservative MPs finding the Liberal Democrat differentiation strategy increasingly infuriating—perhaps that explains why the Prime Minister and the Education Secretary have jumped on the same bandwagon —but if the Liberal Democrats differentiate themselves from the coalition and the Conservatives do the same, where does that leave the Government? Perhaps the Education Secretary, who wants to micro-manage schools, could pose this as an exam question: if two parties come together and then differentiate themselves, what does that leave? Based on the last few weeks, the answer is a complete shambles. Will the Leader of the House arrange in future business for Liberal Democrat and Conservative Ministers to share the speaking time to give both parties ample opportunity to differentiate themselves?

We have known for months that the Chancellor is out of touch with the country, but we did not realise until recently the extent to which he is out of touch with his own ministerial colleagues. The Transport Secretary has spent weeks telling everyone that the increase in fuel duty announced in the Budget is going ahead, and on Tuesday morning on the airwaves she was absolutely clear that it would not be postponed. Later that day at 12.30 pm, Conservative Whips sent a briefing to all Tory MPs saying that freezing fuel duty would be

“hypocrisy of the worst kind”.

Two hours later, the Chancellor popped up at the Dispatch Box to announce that he will, after all, freeze fuel duty. Having humiliated the Transport Secretary, the Chancellor then forced the Economic Secretary to make her now celebrated “Newsnight” appearance to explain the latest Budget U-turn, on the grounds—to quote her words—that

“there isn’t much in the world that is certain”.

Given the disarray and panic in the Treasury bunker, the Leader of the House might struggle to give an exact figure, but how many Budget U-turns have we had to date? I wonder whether the Chancellor could write the next Budget in pencil so that we can rub it all out again when he changes his mind. The Leader of the House has announced two days of debate on the Finance Bill next week. Will he now put his reputation on the line, here and now, and tell us categorically that there will be no more U-turns on this bungling Budget? Perhaps he should just give up and vote for our amendments next week.

The Government have made the wrong choice on the economy—a double-dip recession made in Downing street, borrowing up, tax receipts down, living standards down, no plan for growth. The Government’s economic policy is running out of road. The U-turn that the Chancellor needs to make is on his failed economic strategy.

[Sir George Young]

On the point about the debate on the adviser to the Prime Minister, the hon. Lady is now asking us to do what her Government consistently refused to do, which was to allow the Prime Minister’s adviser to initiate inquiries. She will have to listen to the response given by my ministerial colleague in the debate that I have just announced, which was selected by the Backbench Business Committee.

On the Barclays debacle, as the hon. Lady knows, my right hon. Friend the Chancellor will make a statement, but it strikes me as a failure of the light-touch regime introduced by a previous Minister.

So far as the House of Lords is concerned, the Opposition seem to be in a total muddle. They say that they support the Bill but that they will oppose the programme motion, before they even know what it contains. I ask the hon. Lady, who I know supports reform, to listen to what her leader said in his first conference speech in 2010:

“This generation has a chance—and a huge responsibility—to change our politics. We must seize it and meet the challenge… we need to finally elect the House of Lords after talking about it for…a hundred years.”

That is what he said in 2010, yet yesterday the shadow Leader of the House of Lords said that

“it is not a priority”.—[Official Report, House of Lords, 27 June 2012; Vol. 738, c. 237.]

The only thing that is consistent is the sheer opportunism of the Labour party on this subject.

On the usual knockabout about the coalition from the hon. Lady, I would simply say that two parties are now working together in government more harmoniously than one party did in government for 13 years.

Finally, on fuel, I admire the cool performance of the Economic Secretary in the face of some very aggressive interviewing by Jeremy Paxman. The Opposition accuse the Government of a U-turn, but let us consider their position. First, they introduced a fuel duty escalator—[Interruption.] Secondly, they asked us not to go ahead with their tax rise. Thirdly, when we do not, they complain. The alphabet does not contain a letter describing that manoeuvre.

[Dr Sarah Wollaston (Totnes) (Con)]

Will my right hon. Friend please provide a debate on setting up an inquiry into the very serious allegations made against one of my predecessors, Raymond Mawby? These serious allegations, amounting to treason, need to be fully and fairly investigated, because he is not here to defend himself. It is in no one’s interest to have trial by media.

[Sir George Young]

I admire what my hon. Friend has just done in defending one of her predecessors—a man with whom I served in the House from 1974 to 1983. As she said, so far only one side of the story has been put into the public domain, and it is imperative that the other side also be put forward, in the interests of the friends and family of Ray Mawby. I would like to make the appropriate inquiries to see how we might get the full story into the public domain, so that we can find out exactly what happened to him in the years to which she referred.

[Ian Mearns (Gateshead) (Lab)]

I convey to the House the apologies of my hon. Friend the Member for North East Derbyshire (Natascha Engel), Chair of the Backbench Business Committee, who cannot be with us today owing to unavoidable personal business.

We are grateful for the time allocated to us by the Leader of the House and business managers, but it is still difficult managing demand. Having said that, we were grateful for the opportunity to suggest to him that the debate on the House’s sitting hours be on 11 July. However, we are still struggling with demand for the time allocated. Will he please reconsider the amount of time allocated to the Backbench Business Committee?

[Sir George Young]

I am grateful to the hon. Gentleman and to the Backbench Business Committee for collaborating with the usual channels in enabling the House to have a proper debate about sitting hours in the relatively near future. I take to heart what he has said about both the quantity of time and the predictability. We are committed to providing at least 27 days in the Chamber for the Backbench Business Committee, and I will use my best endeavours to give the hon. Gentleman adequate notice of time and do what I can to find more time, if possible, between now and the end of the Session, when I would expect, in any event, to have the usual pre-recess Adjournment debate.

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

As this week has seen the visit to London of the renowned American economist, Dr Arthur Laffer, may we please have a debate on the optimum level of taxation so that we have the opportunity to restate both the moral case and the economic case for lower taxation?

[Sir George Young]

I am grateful to my hon. Friend. We have two days on the Finance Bill, including a debate on Third Reading, when that might be possible. I would welcome such a debate. The Prime Minister said yesterday—at this Dispatch Box, I think—that he believed in flatter, fairer taxes, which is why we have taken 2 million people out of tax altogether, reduced corporation tax and now have a lower top rate of tax to make Britain competitive with the rest of the world. I look forward to hearing my hon. Friend’s contributions on Third Reading of the Finance Bill on Tuesday.

[Mr Andy Slaughter (Hammersmith) (Lab)]

Could we have a debate about health service reorganisation and cuts, including plans to close four of the nine accident and emergency departments in west London, where the local NHS says that without closure they will

“literally run out of money”?

The right hon. Gentleman will know these hospitals very well, as hospitals such as Hammersmith, Charing Cross, Central Mid and Ealing served his former constituents, and they are much needed by the people they serve.

[Sir George Young]

As the hon. Gentleman knows, I had an interest in the area he now represents. We are putting more resources into the NHS than were planned by the Labour party, but I will share the hon. Gentleman’s concerns with my right hon. Friend the Secretary of State for Health and ask him to write to the hon. Gentleman about the proposed rationalisation to which he refers.

[Sir Tony Baldry (Banbury) (Con)]

As co-chairman of the all-party group on carers, I ask my right hon. Friend to give an undertaking that, if the White Paper on social care is not published and a statement made on it next week, we will have both that White Paper and a statement before the rise of the House for the summer recess—not least to give right hon. and hon. Members the opportunity to study it during that recess? It would be good to see the White Paper, as I understand that it might include some enhanced rights and remedies for carers.

[Sir George Young]

I am grateful to my hon. Friend and take this belated opportunity to congratulate him personally on his knighthood. It is indeed our intention to publish in the very near future the White Paper and the progress report on the reform of funding. We plan to implement the recommendations of the Law Commission. I applaud my hon. Friend’s interest, and that of the group he co-chairs. We are determined to do more for carers and to drive up carers’ rights. I very much hope that when the White Paper is produced, he will be reassured by some of its proposals. As I said, we plan to bring it forward very shortly.

[Mr Nicholas Brown (Newcastle upon Tyne East) (Lab)]

The Leader of the House has announced the Second Reading of the coalition’s House of Lords Reform Bill, which gets two days’ debate. At the end of Tuesday’s debate, after the question that the Bill be read a Second time has been put, is it the Government’s intention immediately to hold the vote on any programme motion?

[Sir George Young]

Yes, that would be our proposition—a proposition that we have adhered to for all the legislation we have produced so far. Discussions continue through the usual channels about the content of the programme motion. I very much hope that the Opposition will enter into sensible and constructive discussions so that we can make good progress on this important piece of legislation.

[Duncan Hames (Chippenham) (LD)]

What representations has the Leader of the House received from Back Benchers, or indeed from the official Opposition, on the number of days in the programme for the House of Lords Reform Bill? Just how many days are they seeking?

[Sir George Young]

The particular usual channel that would handle those negotiations would be my right hon. Friend the Patronage Secretary, the right hon. Member for Derbyshire Dales (Mr McLoughlin). However, I note that in an exchange during yesterday’s debate on the Electoral Registration and Administration Bill, the Opposition were asked how many days they wanted for the Committee stage, and all that they said was “plenty”. As I have said, I hope very much that that they will enter into serious discussions so that this important legislation can complete its progress through the House in an agreed and structured way.

[Chris Bryant (Rhondda) (Lab)]

I know that amnesia is now afflicting so many members of the Cabinet that it is amazing that they manage to recognise one another when they meet, but the Leader of the House said earlier that the fuel escalator had been introduced by a Labour Government. It was not; it was introduced in 1993 by the Conservatives.

My question, however, is about the statutory instrument which is to be debated next Wednesday, and which deals with terrorism. So far the Home Office is refusing to tell us what it is about, and it has not been published. How can we possibly scrutinise a statutory instrument on a key matter next Wednesday if we are not even told what it is about?

[Sir George Young]

The motion will be on the Order Paper in good time for the debate on Wednesday.

[Dr Andrew Murrison (South West Wiltshire) (Con)]

May we have a debate on the exposure of UK business men to personal hazard in Serbia as a result of article 359 of the Serbian criminal code, which was condemned by a resolution of the European Parliament on 29 March and which has resulted in the incarceration without trial of my constituent Mr Nicholas Djivanovic since 28 March last year? Given Mr Djivanovic’s case, the advice must be that investors considering Serbia should proceed with extreme caution, if at all.

[Sir George Young]

I understand my hon. Friend’s concern, and I very much hope that the consular service is giving his constituent all the support that it can. I cannot promise an early debate, but this strikes me as an appropriate subject for an Adjournment debate, or indeed, if we have one, a debate on the pre-recess Adjournment. In the meantime, I will raise my hon. Friend’s constituency case with the appropriate Minister at the Foreign and Commonwealth Office.

[Mr Dave Watts (St Helens North) (Lab)]

It is now eight months since the Department of Health announced that it would provide more money for the seven private finance initiative hospitals. Eight months on, those trusts still do not know how much money they will receive. May we have an urgent statement from the Department on when the money will be allocated?

[Sir George Young]

Rather than waiting for a statement from my right hon. Friend the Secretary of State for Health, I will write to him today and ask whether he can correspond with the hon. Gentleman and answer his question about when the resources to which he has referred will be made available.

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

Yesterday the Associate Parliamentary Manufacturing Group held a meeting to prepare a submission for the Heseltine review, which gives the Government an opportunity to look strategically at how it can support our country’s competitiveness. Given the importance of the review, I believe that it is also important for Members to have their say. Will the Leader of the House be able to commit himself to arranging a debate on the review in Government time and giving Members an opportunity to make clear their views on how we can increase our competitiveness?

[Sir George Young]

The Enterprise and Regulatory Reform Bill is currently going through its stages, and it may be possible to debate the issue raised by my hon. Friend when it returns to the Floor of the House.

My hon. Friend is right: the Chancellor and the Business Secretary have asked Lord Heseltine to undertake an independent review of how spending Departments and other relevant public sector bodies interact with the private sector, and then to assess their capacity to develop pro-growth policies. The review will include a benchmarking exercise comparing how we do with how other countries do, and Lord Heseltine is engaging comprehensively with all interested groups. He has said that he will publish his report in October, and it may be appropriate to hold a debate thereafter, possibly in Back-Bench business time.

[Sir Gerald Kaufman (Manchester, Gorton) (Lab)]

Has the right hon. Gentleman seen early-day motion 274, which stands in my name?

[That this House pays tribute to Emily Rawlins, of Manchester, who has triumphed over her learning disability to become a member of the Great Britain Athletics Learning Disability Team, representing our country in Croatia, Italy, France and Sweden, and winning silver and bronze medals in the hammer; further pays tribute to her volunteering work about coping with bullying, following having been bullied herself for most of her school life, and volunteering in addition as a sports coach and at a charity shop; and hails her as a marvellous example of how courage and determination can prevail in adverse circumstances.]

Will the right hon. Gentleman join me in paying tribute to my constituent Emily Rawlins, a young woman who has overcome a learning disability and bullying to become a member of the Great Britain athletics learning disability team, and who has won silver and gold medals when representing our country in European countries? Will he do his best to ensure that this young lady, who volunteers against bullying and does a lot of other volunteering but is looking for full-time work, does not have her access to jobseeker’s allowance reduced because of the marvellous public work that she does?

[Sir George Young]

rose—

[Mr Speaker]

I assume that the right hon. Member for Manchester, Gorton (Sir Gerald Kaufman) was seeking either a statement or possibly even a full debate on that important matter.

[Sir George Young]

I will raise with the Secretary of State for Work and Pensions the interaction of entitlement to jobseeker’s allowance with the activity to which the right hon. Gentleman has referred. I have indeed seen early-day motion 274, and I join the right hon. Gentleman in congratulating Emily, who is, I believe, a member of Sale Harriers and who provides a great example of the ability to triumph over disability and bullying. I think that the British team won 11 medals in Sweden, which bodes very well for the imminent Paralympics.

[Philip Davies (Shipley) (Con)]

May we have a debate on who the Government thinks should be in our prisons? Although nearly 4,000 burglars and 4,500 violent offenders with 15 or more previous convictions were not sent to prison last year, the Government’s view is that there are still far too many criminals in prison. Perhaps the Government could explain why they have agreed to allow Charles Taylor, the former Liberian President, to serve his 50-year prison sentence in this country. Surely, if we cannot afford to have British criminals sent to prison, we cannot afford to send former Liberian Presidents to prison in this country either.

[Sir George Young]

My view is that some people who are not in prison should be and some people who are in prison should not be, but the issue of whether someone is given a prison sentence is primarily one for the courts rather than Parliament. We recently passed a sentencing Bill which raised the thresholds for some minimum sentences, and I am sure that that was welcomed by my hon. Friend. As for the specific case to which he referred, I will raise it with my right hon. and learned Friend the Lord Chancellor.

[Mr Denis MacShane (Rotherham) (Lab)]

Like many other people, I welcomed the appeal by my right hon. Friend the shadow Chancellor for a cut in fuel duty when he was interviewed on the “Today” programme. A few hours later, the Chancellor accepted it. That is, I think, what we mean by bipartisanship. May we now have a debate on the need to cut air passenger duty? It will cost a family in Rotherham £320 to go on holiday this summer, whereas it will cost a family in France, for example, just £38. Following the U-turn on fuel duty, may we have a U-turn on air passenger duty?

[Sir George Young]

I am not sure whether the right hon. Gentleman was present for Transport questions, but they would have provided him with an ideal opportunity to raise the issue. [Interruption.] If he is proposing a reduction in a particular form of taxation, perhaps he would like to suggest where the money might come from.

[Mr Speaker]

Order. The right hon. Member for Rotherham (Mr MacShane) has been chuntering from a sedentary position that he did not make that point at Transport questions because he was not called by me, but he was called this time, and I know that he is deeply grateful.

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

May we have a debate on spinal muscular atrophy, which is the number one genetic killer of infants and small children? I am sure that the Leader of the House will join me in congratulating 24 of my constituents who are cycling from Le Mans to Olney to raise funds for my three-year-old constituent Maya Czerminska to buy the special equipment that she needs. May I simply ask the Government to redouble their efforts to tackle this appalling disease?

[Sir George Young]

I applaud the fundraising initiative of my hon. Friend’s constituent. The National Screening Committee is currently scoping out a review for screening for spinal muscular atrophy, and once the review has been completed, it will be put on the NSC’s website for consultation. I know that the NSC would welcome an input from my hon. Friend, and, indeed, from those who are raising funds for this worthwhile cause.

[Kate Hoey (Vauxhall) (Lab)]

May we have a debate on the way in which we treat the staff of the House, particularly the very loyal staff on the switchboard, many of whom are my constituents and many of whom have been here for more than 20 years? They have been told that they will have to move to Southampton next May because Capita has taken over the running of the service. Can we really not look at the way in which we treat our own staff?

[Sir George Young]

The hon. Lady is right to draw the House’s attention to the debt that we owe to all those who work for the House and provide such a high-quality service, often in challenging circumstances. I understand that the contract for the switchboard operation has been awarded to Capita as part of the initiative of the House of Commons Commission to reduce costs. The hon. Lady’s concern is not primarily a matter for the Government, but it is a matter for the Commission, so I will raise it with the Commission and see whether there is a role for us to play in minimising the dislocation of her constituents.

[Mike Crockart (Edinburgh West) (LD)]

Will my right hon. Friend arrange for a debate on the functioning of Her Majesty’s Revenue and Customs, especially in relation to the extra funds made available to it to deal with tax avoidance and tax evasion? It appears to me that it is the media that are finding high-profile tax avoiders, while HMRC is chasing one of my constituents for small overpayments of tax credits from more than 10 years ago. I am sure that is not what the extra resources were intended for.

[Sir George Young]

I am sure my hon. Friend will take up with vigour the case of his constituent who is being pursued for tax credits. We all know from our own casework that quite often tax credits are overpaid through no fault of the constituent, and then some time later HMRC asks for the money back and it is not there.

On my hon. Friend’s first point, the Government have given £900 million in extra resources to HMRC specifically to bring in more tax, and we estimate that that will bring in an extra £7 billion of revenue.

[Kelvin Hopkins (Luton North) (Lab)]

This weekend is likely to see the beginning of the end of the euro. While euro-obsessives wring their hands in anguish at the thought, some of us believe that re-establishing national currencies will be beneficial in both economic and democratic terms, yet we have not had a serious debate about life after the euro. Will the Leader of the House make time for such a debate?

[Sir George Young]

My right hon. Friend the Prime Minister has a good record on keeping the House in the picture after European Council meetings. I have to say that I do not think it would be in the interests of this country for the euro currency to come to an end, as the uncertainty and instability would be gravely damaging to British interests and British employment. However, if my right hon. Friend the Prime Minister reports on the weekend conference, there may be an opportunity for the hon. Gentleman to pursue this matter with him.

[Charlie Elphicke (Dover) (Con)]

May we have a debate on the operation of the parliamentary information technology system, so I can understand why we have a wi-fi system that we have to log into about every five seconds, my constituents can have a better understanding of the alleged overspending on iPad rental, and everyone can understand who is responsible for the operation of this system?

[Sir George Young]

Again, that is more a matter for the Commission than the Government, but speaking from memory, I think there are plans to roll out access to wi-fi within the Palace of Westminster. At the moment it does not reach the Leader’s office. I hope that—[Laughter.] I hope that, as the reach of wi-fi spreads through the Palace of Westminster and the signal strength is improved, my hon. Friend will not be inconvenienced in the way that he clearly is at present.

[Helen Goodman (Bishop Auckland) (Lab)]

On Monday, I raised the case of a constituent who has had cancer. She has been told by her doctor that she is not fit enough to go back to work, but she is being denied benefit. The Minister in question refused to meet me and said it was now policy for Ministers not to look at individual cases. I am sure the Leader of the House agrees that we must be able to represent our constituents in exceptional cases. Please will he look into this matter for me?

[Sir George Young]

I assume the hon. Lady is referring to Department for Work and Pensions Ministers?

[Helen Goodman]

indicated assent.

[Sir George Young]

I will certainly pursue this matter. As far as I know, Ministers are accessible to other Members who want to raise cases. On the particular case the hon. Lady raises, I am sure the constituent is appealing against the decision to deny benefit, but I will raise this specific concern with my right hon. Friend the Secretary of State for Work and Pensions and see whether a meeting might be arranged.

[Kris Hopkins (Keighley) (Con)]

Wednesday 4 July is “Independents day”, a campaign day supporting and promoting the independent retail sector, spearheaded in my community by the Keighley Town Centre Association. Can we have a statement on what the Government have already done to support this important sector of our economy, and what they plan to do in the future?

[Sir George Young]

I welcome this important initiative, supported by Keighley, and I pay tribute to independent shops, which are often a lifeline in areas that have not been reached by the multiples. I cannot promise an early debate, but this might be an appropriate subject for an Adjournment debate or one of the longer Westminster Hall debates.

[Huw Irranca-Davies (Ogmore) (Lab)]

Can we urgently have a statement on the medicine supply chain problems facing patients, front-line pharmacists and dispensing doctors? After 18 months of freedom of information requests, we now know that four out of five health boards, health trusts and prescribing bodies in England and Wales are experiencing difficulties in accessing drugs for conditions including diabetes, cancer and coronary care. In our country there is a public service obligation to provide electricity to every household. We should consider putting in place a patient service obligation to make sure UK patients have access to the drugs they need.

[Sir George Young]

The hon. Gentleman raises a serious issue. There has been some discontinuity in the supply chain of certain medicines—in some cases companies can get a better deal if they sell pharmaceuticals overseas. My understanding was that there was a back-up service to ensure that shortages were avoided, but I will pursue this important matter with my right hon. Friend the Secretary of State for Health.

[Mr Edward Timpson (Crewe and Nantwich) (Con)]

Dairy farmers in Crewe and Nantwich and elsewhere are rightly concerned about how much power the supermarket buyers have over them. Will my right hon. Friend find time for a debate on the establishment of the groceries code adjudicator, which my local farmers broadly welcome, and in particular the sanctions available to the adjudicator to make sure the supermarkets adhere to the code, thus protecting our vital dairy industry?

[Sir George Young]

As my hon. Friend will know, in the Queen’s Speech we committed ourselves to introducing the Groceries Code Adjudicator Bill. That Bill has now been introduced and is making its way through the other place. I hope it will come before this House before too long. The adjudicator will have strong powers to hold retailers to account if they have broken the code. He will be able to name and shame retailers and, if the Secretary of State agrees that it is necessary, to impose financial penalties.

[Ms Gisela Stuart (Birmingham, Edgbaston) (Lab)]

May we have a statement or debate on the Government’s proposed changes to secondary education and the reintroduction of O-levels? This week, there was a leak to the Daily Mail and we had an Opposition day debate in which we heard a lot about aspirations but very few details. Schools in Birmingham and elsewhere have a right to know precisely what the Government are planning to do.

[Sir George Young]

We had a good debate on O-levels on Tuesday, and if the hon. Lady looks at Hansard she will see that the resolution agreed by the House refers to the forthcoming consultation on the secondary school qualifications and curriculum framework. The point at which to have another debate would be once that consultation document is in the public domain. I would simply add that we inherited a situation in which far too many children were leaving primary school unable to write, read and add up properly. That was wholly unsustainable, and we have proposals to put it right.

[Mark Menzies (Fylde) (Con)]

Many Members recognise the excellent work nurses do. However, a constituent of mine who has spent more than 40 years as a nurse and nurse trainer has raised concerns about some of the basic personal care aspects of nursing training. May we have a debate on nursing training, therefore, and on how we can ensure that we have an excellent standard of nursing throughout the country?

[Sir George Young]

I agree with my hon. Friend that it is important to drive up the standards of nursing, and I believe that there has been a move to make nursing more of a graduate profession. I cannot promise an early debate on this subject, but again it might be a suitable subject for a debate on the Adjournment or in Westminster Hall. We are committed to driving up the standard of nursing training, so that nurses can provide an even higher quality service to patients.

[Kevin Brennan (Cardiff West) (Lab)]

May we have a debate on endangered species, having read this week the very sad news of the death of Lonesome George, the last giant tortoise of his kind on the Galapagos islands? Does the Leader of the House see any parallel between the plight of Lonesome George and that of the endangered Chancellor, with his tendency to hide in his shell at the first sign of trouble?

[Sir George Young]

A moment ago, the Chancellor of the Exchequer was at my side. I am sure he will return—and he will certainly get support from me for his forthcoming statement. I should just say to the hon. Gentleman, however, that things are not going too well for his party. I see that Tony Blair took control of the Evening Standard yesterday, and when asked whether he wanted to become Prime Minister, he said, “Yes, sure.” I am not sure whether that is the vote of confidence in the current leadership that Labour was hoping for, or whether the reserves are lining up on the touchline.

[Robert Halfon (Harlow) (Con)]

Can we have a debate on topsy-turvy welfarism? The Sun has revealed that taxpayers are to be squeezed by the EU for tens of millions in winter fuel cash to send to pensioners who have not lived in the UK for decades. Surely it is wrong to tax pensioners and working people in my constituency to send what could be up to £90 million in benefits abroad to warm countries and tax havens across Europe.

[Sir George Young]

My hon. Friend is absolutely right about this. My right hon. Friend the Secretary of State for Work and Pensions has said that we will challenge these ridiculous rules and make sure that winter fuel payments go to those in this country. It is ludicrous that we should have to pay for more pensioners living in warmer countries than this one.

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

Following the excellent debate we had in Westminster Hall on women bishops in the Church of England, after recent events in the House of Bishops and with concern across the House of Commons about the good standing of the Church of England, is it not about time that we had a debate on the Floor of the House about women bishops?

[Sir George Young]

If the hon. Lady is in her place this time next week, there will be Church Commissioners questions. The Second Church Estates Commissioner is in his place and has now had advance warning of the question, so he will come up with a scintillating reply in a week’s time.

[Gavin Barwell (Croydon Central) (Con)]

As a member of the Joint Committee that examined the draft Bill, may I welcome the dates for the Second Reading of the House of Lords Reform Bill and the fact that the Government listened to the Committee’s recommendations to protect the primacy of this place? Can the Leader of the House tell us when he will publish the programme motion? Does he share my view that it is, sadly, all too typical of Opposition Front Benchers to say they will oppose something they have not seen and which is necessary to enact the reform they claim to want?

[Sir George Young]

The programme motion will be tabled in good time for the debate. My hon. Friend is absolutely right that it is absurd for Labour Members to say that they are going to oppose the programme motion before they have even seen it.

[Nick Smith (Blaenau Gwent) (Lab)]

Earlier this week, Defence Ministers talked up their budgetary competence. Today, the National Audit Office says that £6 billion has been wasted on redundant kit—this includes storing parts for spy planes that no longer fly. Can we have a debate on improving financial management in the Ministry of Defence?

[Sir George Young]

The MOD will of course consider the NAO’s detailed conclusions and recommendations, and will make a full response in due course. The priority at the moment is to make sure that those in Afghanistan have the kit they need, but we are addressing these issues, which have built up over some time. In respect of the NAO report, we are pleased that the NAO recognises that these changes are already making a difference. We are changing the way in which we buy, store and dispose of equipment, and we are investing in IT systems in order to make progress in this area.

[Christopher Pincher (Tamworth) (Con)]

By 2013, all secondary schools and many primary schools in Tamworth will have converted to academy status, under several providers. Those schools are even now discussing with the borough council how they can develop an overarching schooling strategy for the town. So may we have a debate on education and local government to discuss how county local authorities can devolve further responsibilities and powers to schools and to district councils?

[Sir George Young]

I welcome the progress being made in my hon. Friend’s constituency. The schools that he has just mentioned are joining the more than 1,600 new academies that have been created since we came into office in May 2010, driving up standards and performance. I would welcome a debate along the lines that he suggested about the relationship between schools and local authorities, in which I could hear his thoughts about how we can do more to empower teachers and parents. I cannot promise such a debate in the very near future, but there may be an opportunity for one when we have the consultation paper to which I have just referred.

[Mrs Louise Ellman (Liverpool, Riverside) (Lab/Co-op)]

The Immigration Minister’s recent statement reflects growing concerns that Government policies are stopping able overseas students from coming to the UK. Can we have a debate on that important issue?

[Sir George Young]

I would welcome such a debate. I have seen no evidence that our recently introduced controls are keeping out of the country able students who want to go to our best universities. I have to say that the system of immigration control that we inherited was shambolic, and we have had to take firm steps to bring it under control. We have seen no evidence that our approach is having the effect to which the hon. Lady refers.

[Paul Uppal (Wolverhampton South West) (Con)]

Following on from my question last week, could my right hon. Friend find time for a debate about the use of parliamentary language in this place? A specific theme of such a debate would be the public perception of parliamentary procedure. Does he agree that this would be a debate in which hon. Members from both sides of the House would actively participate?

[Sir George Young]

Further to our exchange last week, Mr Speaker, you and I have exchanged letters, and we are both more than happy to place that correspondence in the Library of the House for the convenience of right hon. and hon. Members. I also understand that the Procedure Committee has asked for a memorandum from the Clerk on this very subject, and I hope that in due course that might also be put in the public domain. I repeat what I said to my hon. Friend last week: when we engage in debate in this House, we ought to observe your injunctions to use temperate language, Mr Speaker, and have regard to what the public watching us think if we use language that is over the top.

[Graham Stringer (Blackley and Broughton) (Lab)]

The Government have kept this House starved of business over the past 12 months, leaving us less than fully employed in this Chamber. That makes it more difficult than normal to justify the return of the Commons in September, but I understand there are also special circumstances this year, as bringing the House back when the carpets and floors on the principal level will have been lifted will incur extra costs, and health and safety risks because of the asbestos discovered. Will the Leader of the House inform us what the extra costs and the health and safety implications are?

[Sir George Young]

The Government believe, and indeed the House believes, that it is wrong that the Government should not be held to account from the middle to end of July until October, as was the practice in the previous Parliament. We believe that it is right that the House should sit in September, so that the Government can be held to account. Figures are in the public domain—I think from last year—showing the extra cost of sitting in September. My view is that it is very difficult to put a price on democracy, that it is right that we should be held to account throughout the year and that we can manage the maintenance of the House within the budget that is available.

[Bob Blackman (Harrow East) (Con)]

Earlier this week, the Prime Minister made an excellent speech about the future strategy for benefits. The key issue that he made clear was that work will always pay but that benefits would be available for those who cannot work. Incredibly, the Labour party opposes a benefit cap and set up, when in government, a huge and complicated system of benefits. May we therefore have a debate on the future strategy for benefits, so that we can pin down, once and for all, where the Labour party stands? [Hon. Members: “Hear, hear.”]

[Sir George Young]

I am very grateful to my hon. Friend. He will have heard my hon. Friends’ reaction to his proposal for a debate, and he may wish to ask the Backbench Business Committee for one. I applaud the speech that the Prime Minister made on Monday. The indications from one of the polls—I think I saw it in today’s paper—is that that speech struck a chord with the vast majority of the population. We have already made progress with universal credit, with housing benefit reform and reforms in respect of disability, but it is right to ask questions as to where we go next. I think that there is an appetite out there for further changes in the direction in which we have already embarked.

[Pat Glass (North West Durham) (Lab)]

The further education loans regulations that are due for implementation on 1 September are to be laid before Parliament on the day before the recess begins, which is, coincidentally, the same day on which most FE colleges in this country close for the summer. That means that parliamentarians will not have time to scrutinise the regulations properly and, probably more importantly, that it will be almost impossible for FE colleges to put in place their operations for 1 September to make this work. May we have an urgent statement on this matter?

[Sir George Young]

I understand the hon. Lady’s concern. She is asking for the regulations to be made available at an earlier date than the one currently planned, and I will certainly make inquiries to see whether that might be possible.

[Andrew Jones (Harrogate and Knaresborough) (Con)]

Youth unemployment in my constituency has fallen for the fourth successive month, and it is down by almost a quarter since the beginning of the year. Ensuring that people leave school with the skills that employers need is crucial to continuing that trend, so can we have a debate on the link between education, skills and employment?

[Sir George Young]

I am delighted to hear the good news in my hon. Friend’s constituency. In the last quarter, youth unemployment in the country as a whole was down by 29,000. I am convinced that the Work programme has a role to play, as do work experience and investment in apprenticeships. He is right to say that the higher the qualifications of those leaving school, the more likely they are to find a job in competitive markets. The thrust of our education policy is indeed to drive up those standards to improve the employability of those leaving school and college.

[Andrew Bridgen (North West Leicestershire) (Con)]

Can we have a debate on the definition of poverty? The current measure of poverty as an income of less than 60% of the national median wage means that if anyone increases their income, even the lowest paid worker in the country, they are judged to have pushed someone else into poverty. Perhaps even more perversely, if everyone in the country was to have an income of zero, we would be judged to have eradicated poverty altogether. That flawed measure highlights the failings of the previous Government, with their concentration on income transfer rather than on addressing the root causes of poverty, namely low aspirations and worklessness.

[Sir George Young]

I am grateful to my hon. Friend for his question and it is right that we should, if possible, move away from a purely mathematical calculation of poverty that aims to move a group of people from just below a level to just above a level. We should try to define poverty in more general terms and then deal with the causes of poverty. Speaking from memory, I think my right hon. Friend the Secretary of State for Work and Pensions is proposing to change how poverty is measured in exactly the direction my hon. Friend proposes.

[Greg Mulholland (Leeds North West) (LD)]

Can we be assured that we will get an oral statement to the House from the Secretary of State for Health next Wednesday, when the Safe and Sustainable review into children’s heart surgery is published? Recent documents suggest that, even now, proper account is not being taken of the independent figures that clearly suggest that certain units will not achieve the 400 units necessary, whereas Leeds will. With that lack of confidence in the process, we need a clear statement from a Minister.

[Sir George Young]

I understand my hon. Friend’s concern and, as I understand it, a report or review is to be published next Wednesday. I cannot promise my hon. Friend that my right hon. Friend the Secretary of State will make an oral statement on that day, but I am sure that he will want to respond to the review in the most appropriate way.

LIBOR (FSA Investigation)

Thursday 28th June 2012 Commons Chamber

12:21

[The Chancellor of the Exchequer (Mr George Osborne)]

I would like to update the House on the Financial Services Authority’s investigation into the manipulation of the setting of the LIBOR and EURIBOR interest rates and the Government’s response. The London interbank offered rate, or LIBOR, and the Euro interbank offered rate, or EURIBOR, are the benchmark reference rates that are fundamental to the workings of the UK, European and international financial markets, including markets in interest rate derivatives contracts. Those contracts might sound exotic but they are the bread and butter of our financial system and are used by businesses and public authorities every day, and they affect the mortgage payments and loan rates of millions of families and hundreds of thousands of firms, large and small.

LIBOR and EURIBOR are by far the most prevalent benchmark reference rates used in euro, US dollar and sterling interest rate derivatives contracts. The outstanding interest rate contracts alone are estimated to be worth $554 trillion. Yesterday, the FSA published notice that Barclays had on numerous occasions acted inappropriately and breached principles 2, 3 and 5 of the FSA’s principles for businesses. As a result, the FSA has imposed a financial penalty of £59.5 million on Barclays. In other words, the FSA reports that this bank, on numerous occasions, did not conduct its business with due skill, care and diligence, that this bank did not take reasonable care to organise its affairs responsibly and effectively, with adequate risk management systems, and that this bank did not observe proper standards of market conduct. As the FSA puts it:

“Barclays’ misconduct…created the risk that the integrity of LIBOR and EURIBOR would be called into question and that confidence in or the stability of the UK financial system would be threatened.”

Barclays are not alone in this. The FSA is continuing to investigate the conduct of a number of other banks in relation to LIBOR, to commit significant resources to its investigations into potential attempts to manipulate LIBOR and to work with its counterparts overseas and with other authorities in the UK.

The investigations concern a number of institutions based both in the UK and overseas, but it is already clear that the FSA’s investigation demonstrates systemic failures at the heart of the financial system at the time. I want to thank Adair Turner and the team at the FSA for a very thorough piece of work, but it prompts three vital questions. First, how were such failures allowed to continue undetected and unchecked, particularly in the two years before the financial crisis, which is when the FSA is clear that the most serious breaches occurred, for which the only motive was greed? Secondly, what changes are needed to our regulatory system in the future to prevent such abuse from occurring again and to make sure that the authorities have every power they need to hold those responsible fully to account? Thirdly, what further investigations are required into the activities at Barclays, what sanctions are available and what questions must the chief executive answer?

First, the FSA report is a shocking indictment of the culture at banks such as Barclays in the run up to the financial crisis. The e-mail exchanges between derivative traders and the LIBOR submitters read like an epitaph to an age of irresponsibility. Through 2005, 2006, and early 2007 we see evidence of systematic greed at the expense of financial integrity and stability. They knew what they were doing:

“Keep it a secret”,

one trader told another in February 2007,

“If you breathe a word of this I’m not telling you anything else”.

Yet no one at Barclays prevents them, no one in the tripartite regulatory system knows anything about it and the Government of the day are literally clueless about what is going on.

The FSA is clear that the most serious breaches of its principles for businesses occurred in the years leading up to the financial crisis. Once the crisis is under way, Barclays’ concern switches from the greed of traders to concern from the management about the reputational risk to the firm. To be fair, Barclays itself raised concerns about LIBOR with the FSA in late 2007 and in 2008. Yes, the financial system was experiencing a severe stress and markets were frozen, but it is clear that Barclays—and potentially other banks—were still in flagrant breach of their duty to observe proper standards of market conduct and give citizens and businesses in this country and elsewhere proper transparent information about the true price of money.

Britain’s tripartite system of regulation failed us in war and in peace and the country has paid a very heavy price for that. That brings me to the second question of how we prevent this from happening again. The Government are getting rid of the whole tripartite system. The Financial Services Bill now before Parliament will create a new and far tougher regulatory system. A new Financial Conduct Authority will focus razor-like on market abuse and protecting consumers. We have been reviewing with the FSA and the Bank of England the operation of the LIBOR regime, which was not regulated under the previous Government’s Financial Services and Markets Act 2000. The market is already changing and the role of LIBOR is changing with it. As part of our review into LIBOR and the strength of the financial regulatory—[Interruption.] May I just say to the Opposition that I think a little more silence would do, and perhaps an apology for the mess that this Government are trying to clean up? [Interruption.]

[Mr Speaker]

Order. Rather more silence is needed on both sides; the Chancellor is quite justified in making his point. I gently remind the junior Whip on the Treasury Bench that although his oratorical talents might be deployed in the future—we look forward to that with eager anticipation and beads of sweat on our brows—for now his role is to fetch and carry notes and to nod in the appropriate places. Silence is required.

[Mr Osborne]

Mr Speaker, my hon. Friend the Member for Chelsea and Fulham (Greg Hands) does far more than that and he is very good at it.

Let me get back to the serious matter in hand. As part of our review into LIBOR and the strength of the financial regulatory architecture, we will examine if there are any gaps in the criminal regime inherited by this Government and we will take the necessary steps to address them. I cannot comment today on possible criminal investigations into individuals involved in this activity. The authorities are exploring every avenue open to them but, shockingly, the scope of the FSA’s criminal powers, granted by the previous Government, does not extend to being able to impose criminal sanctions for manipulation of LIBOR. As part of our review into LIBOR and the strength of the financial regulatory architecture, we are examining whether strengthening the criminal sanctions regime for market abuse and market manipulation is warranted, and if so, we will provide for these powers quickly.

Next week, the Government will be publishing a consultation in response to the report on the failure of RBS and will consider the possibility of criminal sanctions for directors of failed banks when there is proven criminal negligence. Under the previous Government’s regime, fines paid to the FSA are used to reduce the annual levy other financial institutions are asked to pay. I am far from convinced that in all cases that is the best use of the money and we are considering amendments to the Financial Services Bill that ensure that fines of this nature go to help the tax-paying public, not the financial industry.

I have also asked my officials to investigate urgently whether that legislation could be applied to the fine imposed on Barclays bank. It is clear that what happened in Barclays, and potentially in other banks, was completely unacceptable and was symptomatic of a financial system that elevated greed above all other concerns and brought our economy to its knees.

That brings me to my final point. As I have said, a number of individuals are under formal investigation by the FSA, and that number is expected to increase as the investigations continue. The Serious Fraud Office is aware of the matters under investigation and there are ongoing discussions between the FSA and the Serious Fraud Office about the evidence as it develops. The chief executive of Barclays has some very serious questions to answer today. What did he know and when did he know it? Who in Barclays’ management was involved and who therefore should pay the price? It is quite right that the Treasury Committee has asked him to appear urgently to account for himself and his bank, and I congratulate the Chair of the Committee on doing that. We all want to hear his answers. The story of irresponsibility is not over yet.

Our financial services should be a source of economic strength and national pride for this country, but failures in our banks and financial system have cost the country billions and put thousands out of work. Those responsible should be held responsible. We want our financial services to support the creation of jobs and prosperity for millions. This Government are sweeping away the regulatory system that failed. We will protect taxpayers, punish wrongdoing and put right the wrongs of an age of irresponsibility.

12:31

[Rachel Reeves (Leeds West) (Lab)]

I start by thanking the Chancellor for advance notice of his statement, which was handed to me at 12.19 pm—two minutes before he delivered it. [Hon. Members: “Where’s Balls?”] As my right hon. Friend the shadow Chancellor is addressing the Local Government Association’s annual conference in Birmingham, I am responding for the Opposition.

Nine months ago, the Leader of the Opposition talked about “irresponsible, predatory capitalism”, of which this is one of the worst cases yet. The public had been assured that the banks had cleaned up their act. Ordinary borrowers and savers were told they could trust the banks again, but these unfolding revelations shine a new light on shocking practices in one of Britain’s most important banks. What should have been an impartial process of reporting independent interest rate statistics became an exercise in cooking the books, cheating the system and fixing the market.

Financial stability and the effective regulation of our banking and wider financial services industry are vital for stability, for consumers to save and for businesses to invest. Getting the balance of regulation right is an important task for the Government, especially when hundreds of thousands of jobs depend on the industry and when all of us and small businesses in all our constituencies rely so much on the financial services sector.

There are three areas in which I have questions for the Chancellor, the first of which is dealing with the people who are responsible. Are those responsible in the banks being held—[Interruption.]

[Mr Speaker]

Order. This is an extremely serious matter which warrants serious consideration. Let it be absolutely clear to hon. Members on both sides of the House that if they want to shout out, they will not be called to ask a question on the statement. They should not shout, but if they think they are going to shout and then be called to ask a question, I am afraid they are rather deluded.

[Rachel Reeves]

Thank you, Mr Speaker. I could not agree more with you about the importance of this issue.

On dealing with those who are responsible, are those responsible in the banks being held accountable, or will this whole thing just return to business as usual? Are criminal investigations progressing, and which law authorities will be leading the conspiracy and fraud cases that might arise? Has the Chancellor reflected on the consequences for competition and has he considered involving the Office of Fair Trading, the Serious Fraud Office or the City of London police? We need to know who knew what and when, and criminal prosecutions should and must follow against anyone who might have broken the law.

Millions of home owners with variable rate mortgages, small businesses with floating loans and consumers who depend on affordable credit could have lost money because of what amounts to a price-fixing scandal. What support will be available for individuals and small businesses who have potentially lost out because of the market fixing and who contact the Financial Ombudsman Service or the bank directly? Is the FSA also investigating the role of the bank’s auditors in tracking and reporting the manipulation of the figures between the rate submitters and the traders involved? What is happening to ensure that other banks that have manipulated markets in a similar way are brought to justice?

Secondly, what is being done to prevent anything like this from happening again? We raised our concerns with Treasury Ministers about the regulation of LIBOR recently. On 6 March, during a debate on the Financial Services Bill about the set of unregulated financial activities that the Chancellor evidently felt should remain unregulated, the shadow Financial Secretary, my hon. Friend the Member for Nottingham East (Chris Leslie), asked the Financial Secretary directly about the

“billions of pounds of trades that are subject to the LIBOR rating”––[Official Report, Financial Services Public Bill Committee, 6 March 2012; c. 359.]—

and why that might need to be regulated. When asked whether he had a view—any view at all—about ending self-regulation, the Financial Secretary to the Treasury had a one word answer: “No.”

The Chancellor made a conscious decision to exclude LIBOR from the Financial Services Bill in its current form, even when he must have known that a massive FSA investigation into precisely that matter was under way. The reputation of the City of London and our financial services sector is at stake. Instead of Ministers’ saying that the Treasury has no view, surely we need swift action to prevent the market abuse? Will the Chancellor urgently revisit his decision not to regulate LIBOR arrangements and instead amend the Financial Services Bill, which is still before Parliament?

Thirdly, a much wider issue is the culture in the City of London. As Bob Diamond said only last year, culture is about

“how people behave when no one is watching,”

but people in his organisation thought they could do anything they liked, just to make a fast buck. They thought they would never be held to account and that they were effectively above the law. We cannot allow Britain to become a place where the privileged and the powerful act according to their own set of moral standards. That is why we are calling for the strongest punishment for those who have broken trust and broken the law, tough regulation to prevent such practices in future and a culture change in our banking industry. We must get our economy working for the majority, not just a few at the top. The Government must act.

[Mr Osborne]

The whole House will be both surprised and disappointed that the shadow Chancellor is not here to account for himself today. He was certainly there every single day while these abuses were taking place, as the City Minister responsible for regulating Barclays and other banks. The hon. Lady says that the Government should do this and that. We are doing all those things; the question is why did the Labour Government not do those things when all this was actually happening?

Let me answer the hon. Lady’s specific questions. She asks whether the individuals responsible will be held to account. Absolutely, and the authorities are carrying out investigations into individuals. She asks whether people who have broken the criminal law will be held to account. That is absolutely what the authorities are looking at but as I have said, the FSA’s criminal powers granted by the previous Government do not extend to criminal sanctions for manipulation of LIBOR. [Interruption.] The hon. Member for Nottingham East (Chris Leslie) asks, “Why is it unregulated?” It is because he did not regulate it—that is why. We are introducing a major Financial Services Bill, which has been through the House of Commons and is going through the House of Lords, to deal with the abuses that happened under the previous Government.

Secondly, the hon. Lady talked about the regulation of LIBOR. Of course the Government have been reviewing LIBOR while awaiting the publication of this report, which we knew was coming. As I have said, we have considered it carefully and we are looking at criminal sanctions for market manipulation. The hon. Lady did not ask about this, but it is an important point so I shall repeat that we are looking at what can happen to the fines levied on companies under the Act passed by the previous Government. Those fines are used simply to reduce the levy that is paid to the FSA by the rest of the financial sector, so the money paid by Barclays would just go to reduce the levy paid by other banks to the FSA. We are considering changing that, looking at whether that is appropriate in all cases and, specifically, whether the fine that Barclays will pay can go to the general taxpayer, who has suffered so much as a result of the failures of the financial system.

Finally, the hon. Lady talked about a culture change in the City and in banking. I completely agree. That is why the Government have introduced very tough new rules on remuneration and the clawback of remuneration, which is what will happen in this case. It is why we asked John Vickers to look at the whole structure of our banking industry, and the Business Secretary and I are implementing reforms that will ring-fence our retail banks to protect them better. It is why we have before Parliament as I speak the Financial Services Bill, which will sweep away the financial regulatory system that failed this country so badly. The Labour party’s trouble is that it is led by the cheerleaders for the age of irresponsibility, but they have yet to say sorry for it.

[Several hon. Members]

rose—

[Mr Speaker]

Order. A very large number of hon. and right hon. Members are seeking to catch my eye, but I remind the House that there is significantly subscribed business to follow, under the auspices of the Backbench Business Committee; therefore, I must appeal for short questions and short answers.

[Mr Andrew Tyrie (Chichester) (Con)]

What is now left of trust between Parliament and the banks? Barclays and probably other banks were profiting by lying and rigging the markets at a crucial time in the last crisis, when the Government had a right to expect that they would supply the then Chancellor with reliable information on the basis of which to conduct policy. The Treasury Committee will now investigate properly. Under the current legislation, as the Chancellor has pointed out, the Financial Services Authority has no power to bring a criminal prosecution in relation to not only LIBOR, but derivatives. Will the Chancellor undertake now to amend the Financial Services Bill to include derivatives and LIBOR in the legislation before Parliament?

[Mr Osborne]

I completely agree with the sentiments that my hon. Friend has expressed. I congratulate him and his Committee on acting swiftly to ask Mr Diamond to come and account for himself. As I said in my statement, we are looking at strengthening the criminal sanctions regime in general for market abuse and market manipulation, not just of LIBOR but in other parts of the market; and next week, as planned, the consultation on potential sanctions for directors of failed banks will be published. Sadly, the Government have been in this situation before with the FSA’s report into the failure of Royal Bank of Scotland, when the authority reported to us that it did not have the powers it would have liked to hold to account those responsible for the failure.

[Mr Alistair Darling (Edinburgh South West) (Lab)]

I am sure that, in his quieter moments, the Chancellor will reflect on the fact that we are kidding ourselves if we think that the UK was the only country where this sort of thing was going on. The American authorities are just as concerned as our authorities. The situation is symptomatic of a culture that prevailed for much of the last decade, when, frankly, anything was allowed to go.

Does the Chancellor accept two things? First, LIBOR now has to have some degree of independent supervision. It cannot be a work of fiction. It is so important, especially at times of financial crisis—in 2008, we were concerned about the financial health of Barclays and other banks—to know exactly what it is costing them to borrow. Secondly, although the FSA may not have criminal powers, I am pretty sure it does have powers to take out of banks and put off the road the people who are responsible for doing this, the people who tolerated it, and those gained from it and condoned it. If that is not done, we have no chance whatsoever to move on in what remains a very important industry for this country.

[Mr Osborne]

The former Chancellor is of course right: there was poor financial regulation in American markets too, and part of the investigation has been conducted jointly with the American authorities—but LIBOR was set in London, which is why it is called LIBOR.

The right hon. Gentleman raised two points. The regulation and supervision of LIBOR is precisely what we are investigating, although we have to make sure that we are not regulating the LIBOR market as it existed three years ago. That market today is somewhat different and changing quite a lot, so we have to get the regulation right for 2012, not for 2006-07. His second point was on the individuals concerned and the FSA’s powers. I have spoken to Adair Turner and I am absolutely clear that the FSA is pursuing cases against individuals, but it is a prosecuting authority and it would not be appropriate for me to comment about those individuals and ongoing cases.

[Mr David Ruffley (Bury St Edmunds) (Con)]

Can the Chancellor indicate how widespread the investigation is? How many other British banks are under investigation for market manipulation?

[Mr Osborne]

HSBC and RBS are two of the banks under investigation, but international banks such as UBS and Citigroup are under investigation too, partly for activities conducted in this country.

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

The Chancellor referred to the costs and penalties that the general public have suffered. Is there any estimate of how much per head ordinary people in this country have suffered from the activities of a group of corrupt banksters?

[Mr Osborne]

First, I hope the hon. Gentleman does not mind me saying on behalf of the whole House that we very much welcome him to his place. He has the deepest sympathy of the whole House for the tragedy in his family. It is good to see him back here.

There is no estimate of the cost to individuals or consumers, and it would be very difficult to construct one. We are talking about the daily rate set, in the case of these abuses, over a three or four-year period, and it was used to set mortgage rates, loan rates and all sorts of other things. Sometimes the rate was manipulated to be too low and sometimes it was manipulated to be too high compared with the true market price. We do not have an estimate, but it is clear that, as the FSA says, the manipulation contributed to the risk to the entire financial system, which then, in effect, collapsed, not because of that, but as part of the culture we have been talking about, and the country has paid many billions for that.

[Andrew Selous (South West Bedfordshire) (Con)]

I agree with what the Chancellor said about the failure of the previous regulatory regime, but as far as the senior management of the banks are concerned, does he agree that ignorance is absolutely no defence? They should have known what was going on.

[Mr Osborne]

I completely agree. One of the things that has shocked the entire country in the aftermath of the financial crisis is how little people appeared to know about what was going on in their banks. That is why it is very important that Mr Diamond accounts for himself and his management and explains what they knew and when they knew it.

[Sir Stuart Bell (Middlesbrough) (Lab)]

May I build on the question put by my right hon. Friend the former Chancellor of the Exchequer about the independence of LIBOR? The Chancellor has not referred to the British Bankers Association, which was involved in 1984 in putting the rate together. Is it appropriate to talk again to the association to see if we can get a true, independent LIBOR?

[Mr Osborne]

The BBA is concerned about what has happened and has already instituted a review into the operation of LIBOR. I should like to hear its thoughts on that, but we need to look at the regulation of the rate and its independence. LIBOR is a very important rate that is used to set mortgage and loan rates for pretty much everyone in the country, so we want to make sure that what happened never happens again.

[Claire Perry (Devizes) (Con)]

When I heard about the situation, it made me think that “light touch” should be substituted with “clueless”. I am extremely concerned about the damage to Britain’s international reputation as a world-leading financial centre. Has the Chancellor had any conversations with his international counterparts to keep them apprised of the investigation, and does he think this is happening in other markets?

[Mr Osborne]

The fact of the investigation was something I discussed with Finance Ministers and representatives of other Governments, but I have not spoken with any of them since the FSA report was published yesterday because the issues immediately before us are about Britain and a British bank. As I indicated in my response to my hon. Friend the Member for Bury St Edmunds (Mr Ruffley), however, a number of international banks were potentially involved, such as UBS and Citigroup, which are not British banks and are in part regulated by overseas authorities. The whole FSA investigation is part of a joint international effort with the US Department of Justice and the Securities and Exchange Commission.

[Mr Dennis Skinner (Bolsover) (Lab)]

If we are going to study the culture of the banking system and the changes that have taken place over the years, would it not be fair to start from the fact that the late ’80s, with the big bang in the City, is when the culture of the banks changed dramatically? If we are going to lay blame, let’s get the history books right.

There is another scandal with the banks. Now that the Chancellor is in the mood to tame them, what about looking at the question that blind and disabled people are contributing more to reduce the Government’s deficit than all the banks put together? Sort that out as well. As for saying somebody is absent, the Chancellor ought to be explaining why he did not turn up at the BBC and face the music with Paxman.

[Mr Osborne]

It is one thing not to appear on the BBC’s “Newsnight”, and another not to be in the House of Commons to answer to the public and to Parliament for one’s own mistakes during the years of irresponsibility. That is the question the shadow Chancellor will no doubt have to answer today. As for history lessons, let me say this to the hon. Member for Bolsover (Mr Skinner): he has never once got up and apologised for the mistakes of the Government he consistently supported over 13 years. It is no good blaming what happened in the 1980s; we are talking about what happened in 2005, 2006, and 2007, when he and his cronies were in charge.

[Mr Desmond Swayne (New Forest West) (Con)]

When I left banking 16 years ago, we were a dull profession, but capable of giving solid advice. When did it go so horribly wrong? When did bankers start treating their customers as punters to be exploited or devoured? Can my right hon. Friend assure the House that his reforms will restore the status quo ante?

[Mr Osborne]

I think the answer to my hon. Friends question is: when he left the industry.

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

The Chancellor concentrated heavily on regulation in his statement. He was less keen to tell the House that throughout the period in question, he and his colleagues were calling for less regulation, not more. Does not the responsibility for wrongdoing really lie with those who did wrong—in this case, the traders in Barclays, and very possibly other banks, who participated in a rotten culture, far removed from the job that we want banks to do, which is supporting savers, home owners and businesses? If it really does come down to regulation, why will the Chancellor not accede to the request made by Opposition Front Benchers and now the Chair of the Treasury Committee to include LIBOR in the Bill that is going through Parliament?

[Mr Osborne]

First of all, when in opposition, we actually objected to the creation of the FSA, the tripartite system of regulation, and taking the Bank of England out of supervision. We voted against that. By the way, I remember—I was the shadow Chancellor at the time—the previous Prime Minister endlessly berating us for voting against that particular piece of legislation.

When it comes to responsibility, of course those involved should be held responsible. I have made that absolutely clear, and that is what the FSA is doing. However, I point out that the Government at the time should be held responsible for the culture that they presided over. As I say, we will take the steps necessary to prevent this happening again, and we are looking at the regulation of the LIBOR market to get it right.

[Several hon. Members]

rose—

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. A lot of Members want to speak and I want to get everybody in, but we need brevity in both questions and answers.

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

This ruling surely confirms that the financial markets, as many of us suspected, have been neither free nor fair, but rather a sewer of systemically amoral dishonesty. Is not the case for separation of retail banking from merchant banking now so overwhelming as to be unanswerable?

[Mr Osborne]

I agree with my hon. Friend that we should separate retail banking from investment banking, but the best way to do that is through the ring-fence as proposed by John Vickers. We asked him and his distinguished commission to look at the structure of banks, and explicitly to consider the option that some had proposed of completely separating retail and investment banking. The commission considered and rejected that option, and instead proposed an approach that it thought would be stronger for financial stability, and particularly for the stability of retail banking. That is the ring-fence approach, for which we will now legislate.

[Stewart Hosie (Dundee East) (SNP)]

Notwithstanding that Barclays has been hit with a very large fine, it is truly shocking that market manipulation of this sort is not a criminal offence, particularly as the FSA final notice tells us that the abuses went on for three and a half years. I echo the comment made by the Chair of the Treasury Committee and others: we should look again at legislating now, in the Financial Services Bill, particularly as regards the powers of the Financial Conduct Authority—the conduct-of-business authority that will be responsible for this matter—to make sure that it has the powers and the sanctions it needs to deal with this sort of problem.

[Mr Osborne]

I agree with the hon. Gentleman. Of course the Financial Services Bill is before Parliament and there is still some time to go before it completes its passage, so it is a readily available vehicle, but we want to make sure that we get this right, given what went so badly wrong with the previous attempt to regulate the financial services industry.

[Mark Garnier (Wyre Forest) (Con)]

While £60 million may sound like a great deal of money to the average man in the street, when it is compared with the size of Barclays’ balance sheet and the potential claims for compensation, does my right hon. Friend not agree that it is a relatively small amount of money? When he is looking at compensation for those who have lost out, will he take care to ensure that Barclays is liable for its own liabilities—that they will not necessarily be shared with other banks and that each bank takes care of its own liabilities?

[Mr Osborne]

Under the current regime, it is up to the FSA to consider whether there is loss, and it is up to individuals who feel that there has been loss to bring their case forward. As I say, the Government have not been able to come up with a round figure for the total impact on the financial services industry and the economy of what went on, and nor has the FSA. If individuals feel that they have been affected, there are channels available to them.

[Chris Bryant (Rhondda) (Lab)]

Is not the truth of the matter that all the political parties were so nervous about financial services business going abroad, because it is so international a business, that we were effectively in thrall to them? Would it not make perfect sense for Mr Diamond, when he appears before the Select Committee, to give evidence on oath?

[Mr Osborne]

It is entirely up to the Treasury Committee to decide how it wishes to conduct its business.

This Government are introducing far-reaching changes to our regulatory system and the structure of our banking system. It is far from clear that that receives the support of the shadow Chancellor. He has gone out of his way to point out what he thinks are the flaws in the Financial Services Bill, and he has gone out of his way at the Dispatch Box to defend the tripartite system that he designed. The hon. Member for Rhondda (Chris Bryant) talks about all-party consensus; let us have all-party consensus on clearing up the mess that the previous Government presided over.

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

First, I declare that before I joined the House, I worked for Barclays—[Laughter]—and before that, the FSA.

As the Chancellor may recall, I wrote to him on 7 February calling for a change in the way fines were treated, and for an amendment to paragraph 16 of schedule 1 to the Financial Services and Markets Act 2000, so I welcome his announcement that other banks will not profit from the wrongdoing of banks that have breached rules.

I turn to an issue that the former Chancellor, the right hon. Member for Edinburgh South West (Mr Darling), picked up: the ability to take enforcement action against senior managers, particularly at executive level. Lord Turner set out in his RBS report the difficulties of that, in terms of the evidential level required. Can the Chancellor update the House on when a response, in the form of a discussion paper from the Treasury, will be forthcoming? Will it be before the summer recess?

[Mr Osborne]

I am grateful to my hon. Friend for sharing his CV with the House. [Interruption.] At least he did not work for the shadow Chancellor. The answer to his question is that we are publishing the consultation next week.

[Helen Goodman (Bishop Auckland) (Lab)]

The Chancellor has very sensibly said that he will look at how fines are used, but his answer to my hon. Friend the Member for Ilford South (Mike Gapes) about calculating how much people have lost is somewhat disappointing. Can he not look into whether the fine money can be used to compensate people? Surely he is not expecting every individual to make their own case against a large institution such as Barclays bank?

[Mr Osborne]

I am happy to take away, because it has been raised by several Members, the issue of the total impact on the economy and on individuals. I would point out to the hon. Lady that that might be extremely difficult to work out, because the LIBOR rate was manipulated up as well as down. Sometimes the rate was too low for the true market price, and sometimes it was too high. It was manipulated by its derivative trading floor to suit the particular position that the bank had taken on that day, and that is why it is a difficult calculation to make. The FSA has made it clear, however, that that contributed to a risk to the country’s financial stability, and the cost of that is enormous.

[Matthew Hancock (West Suffolk) (Con)]

In January, I set out the case for criminal sanctions against irresponsible management at significant financial institutions, so I welcome the announcement that that will be taken forward. May I push the Chancellor to make those sanctions as firm as can be done responsibly to ensure that those who profit from deep irresponsibility do not face the threat of walking out of the door and spending more time with their money but instead have the full force of the law against them if they do things wrong?

[Mr Osborne]

My hon. Friend was prescient in making his case. He has pointed to something that concerns a number of people: the apparent ability of, for example, authorities in the United States to use criminal sanctions, while the authorities in the UK have not been granted those powers by Parliament. That is precisely what we are looking at.

[Mr Nicholas Brown (Newcastle upon Tyne East) (Lab)]

The Government’s new financial services regulatory architecture puts a lot of power and responsibility on the shoulders of the Governor of the Bank of England, but proposes no change to the relationship between the regulator and Parliament. May I ask the Chancellor to reflect again on the relationship of the House and the other place with the regulator, and how best we can establish a continuing—not adversarial—dialogue with the regulator so that problems, such as the one that he has shockingly reported to the House, can be explored and reflected on in a mature way, and not subjected to party political point scoring?

[Mr Osborne]

Of course, it is important that the regulator, including the Bank of England, is accountable to Parliament for its actions, and has to answer for its actions, while at the same time—and I think that there is cross-party support for this—we maintain the independence of the Monetary Policy Committee and the Governor in his role. The Financial Services Bill includes many new tools to increase accountability to Parliament and to the public. In the White Paper that accompanied publication of the Bill, we set out further changes that we are making in the House of Lords to increase that accountability.

[David Mowat (Warrington South) (Con)]

Had price fixing on that scale taken place in other industries, under competition law, a fine of multiples of turnover could have been levied. Will the Chancellor tell us whether there is any possibility of a further fine, because £60 million is not a great deal to Barclays?

[Mr Osborne]

The FSA, which is the appropriate authority, has concluded its work on assessing the fine that Barclays has to pay, but there is also the important question of what happens to the fine. I do not think that other financial institutions or banks benefit from the lower FSA levy as a result. We are therefore looking at precisely that in the Bill, specifically at whether the Barclays fine can go to the taxpayer, rather than to the financial services industry.

[Kevin Brennan (Cardiff West) (Lab)]

Further to the words of my right hon. Friend the Member for Wolverhampton South East (Mr McFadden), may I gently remind the Chancellor that he told Andrew Marr two things on 4 December 2005, when asked what he would have done differently if he was Chancellor? One was about taxes and the other was that

“we need…a lower regulatory environment”.

Why is his hindsight so different from his foresight?

[Mr Osborne]

First, the Opposition voted against the creation of the tripartite regime. Secondly, I remember the joyous occasion, when I was shadow Chancellor, at Mansion House in 2007 of all years, when the former Prime Minister, the right hon. Member for Kirkcaldy and Cowdenbeath (Mr Brown), told us about the

“new golden age for the City”,

and the right hon. Member for Morley and Outwood (Ed Balls) praised the virtues of the light-touch regulatory regime of which he claimed sole authorship, although these days, funnily enough, he does not talk about that very much.

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

Does my right hon. Friend agree that, as the report by the Economic Affairs Committee showed, under Labour’s failed system, it was unclear who was in charge of regulating the banks? Is it fair to say that, sadly, Labour just dropped the ball on this one?

[Mr Osborne]

It is true that the tripartite regulatory system—and one of the three parts was the Government of the day—failed. That is self-evident, which is why we are making these changes. It is disappointing that they do not command the full support of the Opposition Front Bench, but perhaps the hon. Member for Nottingham East (Chris Leslie), on his 40th birthday, will reconsider his position now that he has reached a new age of maturity.

[Frank Dobson (Holborn and St Pancras) (Lab)]

Does the Chancellor of the Exchequer agree, in view of the fact that the already overpaid bankers have been revealed to have bolstered their bonuses by corruption and criminal conspiracy, that it is about time that the Government and, in particular, the news media gave far less credence to bankers and their apologists when they come out urging austerity on everyone else?

[Mr Osborne]

Of course, the credibility of the industry has quite rightly taken a hit because of what happened. However, we have a new pay regime so that we can claw back some of that money from the traders and bank chiefs involved, which is a good thing. Secondly—and we are all rightly concerned about what has happened, and we need to change it—we have to change the financial services industry from one that was part of the age of irresponsibility to an industry that employs many hundreds of thousands of people and which creates jobs and prosperity in this country. It is the largest private sector employer. Knowing the right hon. Gentleman’s constituency, it is almost certainly the largest private sector employer there. Yes, we have to hold those responsible to account, but we must also rebuild the industry, because it is absolutely vital to our economy.

[Sir Tony Baldry (Banbury) (Con)]

The City of London and its integrity are crucial to our country’s welfare. Does my right hon. Friend agree that this rather sorry, sad state of affairs is a wake-up call for every individual and institution in the City of London which, collectively, has to rediscover and reassert that sense of integrity?

[Mr Osborne]

I completely agree with my hon. Friend. As I said, this is an incredibly important industry for our future, despite the problems that the banking sector in particular has caused in our recent past. It is important that we do not taint the entire financial services industry with what went wrong. That industry includes insurance companies and all sorts of other businesses that were not involved, but the banks themselves, as the most prominent institutions in the industry, have a huge responsibility to change their culture and image with the rest of the country.

[Mark Durkan (Foyle) (SDLP)]

What we are looking at essentially is daily daylight robbery, with a culture that said, “Anything goes, but nobody knows”. In light of what we do know, would it not be a dereliction to introduce the Financial Services Bill without specifically addressing LIBOR and looking again at the data competence of the regulators? Without wishing to draw the Chancellor on what criminal charges might be brought, does he believe that the forfeiture committee should look at the cases of other bankers who may be implicated?

[Mr Osborne]

The part of the country that the hon. Gentleman represents has been affected perhaps more than any other by what went wrong in financial services. Northern Ireland has suffered enormously from the failure of banks in the UK and in the Republic, and it has paid perhaps a heavier price than anyone else, so he speaks with authority and passion on this. Let me make it absolutely clear: we are going to deal with the regulation of LIBOR, and we will choose the most appropriate vehicle. The Financial Services Bill has been introduced in the House, so it is a convenient vehicle but, as I said, let us introduce the right regulation and get this right after its having gone spectacularly wrong in the past. As for the forfeiture committee, it is completely independent of the politicians of the day, he will be glad to know. No doubt, its members will have heard what he said.

[Paul Uppal (Wolverhampton South West) (Con)]

Continuing the “Newsnight” theme, last night Lord Myners, when asked about the previous Government’s role, shrugged his shoulders and said that this was nothing to do with them. Does my right hon. Friend agree that although Opposition Members are anxious to distance themselves from banking involvement, the anything-goes culture was driven by light-touch regulation, and that if we are to make progress, those who sit on green benches or on trading desks must ultimately take responsibility for their involvement?

[Mr Osborne]

My hon. Friend makes a good point, which is that those responsible in government at the time have to apologise and account for their own role before they will be listened to when speaking about their plans for the future. At present they do not seem willing to do that.

[Derek Twigg (Halton) (Lab)]

I must check up on what Barclays says about customer care, following the debate today. In view of what the Chancellor told the House today, do he and the Governor of the Bank of England have full confidence in the senior management of Barclays?

[Mr Osborne]

What I have said is that the chief executive of Barclays has some very serious questions to answer about who knew what when, and who in the management knew that.

[Stephen Williams (Bristol West) (LD)]

All our constituents will be outraged but perhaps not surprised by yet another scandal rocking the foundations of part of a functioning liberal democracy. A fine on the bank is all very well; that just hits the shareholders. The directors of that company have, at the very least, failed in their fiduciary duties to those shareholders and may have done or sanctioned an awful lot worse. What sort of sanctions should be taken against directors who preside over such terrible practice?

[Mr Osborne]

The Government whom the hon. Gentleman and I both support have introduced clawback so that the bonuses that were given to executives, traders and others in the banks can be clawed back if necessary. That did not previously exist. We are looking specifically at the responsibilities of directors of failed banks. The consultation on that will be published next week as a result of the FSA inquiry into what went wrong at RBS, and as I say, we are responding to today’s report by looking at the regulation of LIBOR, at the criminal sanctions that are available for prosecution, and at what happens to the fine, so that it is the people of Bristol who benefit from the fine that is paid, rather than other banks in the City of London.

[Mr Andrew Love (Edmonton) (Lab/Co-op)]

This inquiry was started by the US authorities. The fines that have been imposed, which have been mentioned by many Members, were four times as large in the United States as they are in the United Kingdom. The US authorities also imposed stringent conditions on the operations of Barclays in this area. When will we get robust regulation in this country? When will the FSA send out e-mails entitled, “You’re nicked, big boy”?

[Mr Osborne]

It sounds like one of the e-mail exchanges that the traders were engaging in at the time, if one reads the report. The US authorities are rightly involved, because much of the manipulation happened with the US dollar market so it is perfectly understandable why they would want to be involved. I have raised this question. Perhaps it is an issue that the Select Committee would also want to consider—why in the US there seem to be more powers available to the authorities than in the UK, and what we can do in this House to make that change here so that the UK authorities have the full range of powers available to them.

[Mr David Burrowes (Enfield, Southgate) (Con)]

It is right that the focus of attention should not be just on the greedy bankers drinking Bollinger and the like, but on constituents—victims who have had their businesses and homes trashed as a result of this scandal. As they are the victims of gross irresponsibility, is it not time for some basic responsibility, with the chief executive of Barclays stepping down and the shadow Chancellor saying sorry?

[Mr Osborne]

As I say, the chief executive of Barclays needs to account for his actions, and the Treasury Committee provides the platform where he can do that, and as I said, the shadow Chancellor needs to account for his actions too.

[Gregg McClymont (Cumbernauld, Kilsyth and Kirkintilloch East) (Lab)]

Across the House there is agreement on the need for better regulation of investment banks, but does the Chancellor think regulation on its own, however well designed, will be enough to deal with the rotten culture at the heart of our investment banking, which this episode has revealed? Does it not need a change in leadership to change that culture fundamentally, going forward?

[Mr Osborne]

Where I would agree with the hon. Gentleman is that regulation cannot do everything and we need the right culture of management in the banks, but there is also a job for the regulators here. One of the purposes of the Financial Services Bill is to put the Bank of England in charge and allow the regulator to exercise more judgment. As I have said before in the House, the Royal Bank of Scotland ticked every single box when it came to its takeover of ABN AMRO, yet many people were asking at the end of 2007, “Is that a sensible transaction?” We need the regulators to be empowered to make judgment calls, not just to check whether every line of the regulation has been complied with.

[Clive Efford (Eltham) (Lab)]

I agree with everything that the Chancellor said in his statement, but following that, all he has done is try to heap responsibility on the Opposition Front-Bench team, rather than dealing with the bankers who are at the heart of the problem. We all know that lighter-touch regulation would have come in had he been Chancellor at the same time. That is not the point. The point is that people out there are angry. Those people are thieves and criminals, and they have made beggars of many of our constituents, who want to know what this Government are going to do about it. Can the Chancellor say whether the financial regulatory Bill before the House deals with all the issues that have been raised as a result of the report from the FSA yesterday? If not, what is he going to do about it?

[Mr Osborne]

I will tell the hon. Gentleman what this Government are doing. First, we are getting rid of the tripartite system that failed. Secondly, we are changing—[Interruption.] I will tell hon. Members what failed—the regulation of financial services. The hon. Gentleman’s constituents and mine and everyone else are paying a very heavy price for that, so we are changing the regulator, changing the structure of banks in order to have ring-fenced retail banks—

[Clive Efford]

No. The right hon. Gentleman is doing nothing. It is business as usual.

[Mr Osborne]

The hon. Gentleman voted for 13 years for a Government who failed this country. We are changing the regulation, changing the structure of banking—[Interruption.] and we are dealing with this latest abuse— [Interruption.]

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. We have heard the question. The hon. Gentleman should have the courtesy to listen to the answer, even if he does not like it. There is no need to get so excited—

[Clive Efford]

Plenty of people out there are excited.

[Mr Deputy Speaker]

Order. Is the hon. Gentleman questioning me?

[Clive Efford]

I apologise, Mr Deputy Speaker.

[Jeremy Lefroy (Stafford) (Con)]

The prices of many important international commodities are set in London, such as cocoa and robusta coffee, and tens of millions of smallholder farmers and poor people around the world depend on these. Is my right hon. Friend confident that the kind of problems that we have seen with LIBOR are not spreading to such markets, which are so important for people around the world?

[Mr Osborne]

Of course we should be vigilant in the supervision of all markets. Although there have been many complaints of the kind that my hon. Friend makes, every investigation here and, as far as I am aware, in other jurisdictions has not found the kind of market manipulation in those commodity markets as we see in LIBOR.

[Jonathan Edwards (Carmarthen East and Dinefwr) (PC)]

In Iceland bankers have been prosecuted, as well as those politicians who presided over the 2008 financial crash, including the then Prime Minister, on charges of gross negligence. What lessons has the Chancellor learned from Iceland on how to hold politicians and bankers to account for their actions?

[Mr Osborne]

The hon. Gentleman really is tempting me. As we do not see so much of the previous Prime Minister, perhaps we should send him off to Iceland, where I think he would be particularly welcome.

[Bob Blackman (Harrow East) (Con)]

It is clearly vital that we rebuild confidence in the banking system after this further scandal, but there are questions to ask about what compliance regime was going on in Barclays during the mid-2000s and in every other bank. Does my right hon. Friend agree that no matter what the regulations are, it is now vital that the banks come out with a clear, transparent and independent compliance regime to make sure that people who disobey the rules are caught very quickly?

[Mr Osborne]

My hon. Friend is right that the compliance regime is absolutely the first line of defence in the financial services industry. To be fair, Barclays did raise concerns about the LIBOR market operation in late 2007 and early 2008. I think that we can draw a distinction, as the FSA does, between what was going on in 2005-06 and early 2007 and what happened once the crisis hit. He is absolutely right that the compliance regime is vital, and if there are any banks listening to what has happened today that are not looking carefully at their compliance regimes and ensuring they are up to scratch, I think that they are being pretty foolish.

[Ben Gummer (Ipswich) (Con)]

The Chancellor will know that concerns about the setting of LIBOR go back some time. A paper circulated by New York university’s Stern business school in 2008 raised the issue of the manipulation of LIBOR. Indeed, in that year the panel changed the criteria for and composition of the setting of LIBOR because of concerns about the fairness of the rate. What investigation will he undertake about the concerns raised at the time, whether they were picked up by the FSA, whether the American authorities passed any concerns to the Treasury and the FSA and, if so, what was done about them?

[Mr Osborne]

My hon. Friend is right that concerns were raised in late 2007 and in 2008 once the markets had frozen and become very illiquid. Barclays raised its concerns with the FSA, which is why the report draws a distinction between the situation before the summer of 2007 and the situation after, because different things were going on. In 2007-08 Barclays, and potentially other banks, were concerned about their reputation and the high cost of funding they were being charged, so he is right to draw that distinction. The FSA began investigating the complaints in 2009, as set out in the report. He asks a good question on whether any evidence was passed to the authorities by international bodies or other Governments. That is not in the report, so I am happy to get back to him on whether there was anything specific.

Backbench Business

Thursday 28th June 2012 Commons Chamber

Green Economy

Thursday 28th June 2012 Commons Chamber

[Relevant documents: The Twelfth Report from the Environmental Audit Committee, Session 2010-12, A Green Economy, HC 1025; and The Sixth Report of the Committee, Budget 2011 and Environmental Taxes, HC 878, and the Government Response, HC 1527.]

13:21

[Laura Sandys (South Thanet) (Con)]

I beg to move,

That this House urges the Government to promote the right fiscal and regulatory framework to accelerate green growth as an intrinsic part of the UK’s economic recovery strategy.

I want to thank the Backbench Business Committee for providing time for this important debate at this moment in the economic cycle, when we are considering the draft Energy Bill, which will reform the electricity market, and different issues relating to the renewables obligation and other fiscal measures. I also thank the Economic Secretary to the Treasury for agreeing to respond to the debate and so many colleagues on both sides of the House for signing the motion.

Few terms in today’s industrial dictionary are as loose and ill defined as the word “green.” People talk about “the green economy” and “green jobs.” The word—I mean no disrespect to the hon. Member for Brighton, Pavilion (Caroline Lucas)—places a set of philosophical values around policies that, I believe, are not about debating sandal economies. I strongly believe that the measures the Government have put in place are aimed at increasing productivity, improving output, supporting greater competitiveness and building a resilient economy that is both lean and keen for the future.

In my constituency, I have seen at close hand the construction of a multi-billion pound wind farm. It is much more about heavy engineering than traditional green jobs. Those working at the cutting edge of new energy sources, vibration technology, surface engineering and friction reduction will deliver the so-called green revolution, but those individuals hold degrees in mechanical engineering, not sustainability. The green deal will implement energy efficiency measures in homes and offices throughout the country thanks to skills that are as wide ranging as construction innovation, research in plastics and synthetic materials and, of course, practical installation. From heavy engineering and the white coats in our university laboratories to those who fit cavity wall insulation, all these jobs and all these opportunities comprise part of that wide term, “the green economy.”

Today, the green economy is no sideshow; it represents a significant part of the UK economy, with more jobs than in information and communications technology, finance and insurance, and the motor trade. With low-carbon and environmental goods and services growing by 4.6% in 2009-10, it is a growth sector. However, we also need to talk about our industrial and energy policy in an international context. Why are South Korea, China and other Asian countries placing renewable energy and energy efficiency at the core of their industrial growth strategies? They are not overburdened with Green party candidates, and in some cases, such as China, they do not even need to secure votes. They are trying to build what is absolutely essential to this country: a strong, sustainable and resilient economy in which energy consumption and fossil fuel inputs are considered vulnerabilities, not assets.

[Kelvin Hopkins (Luton North) (Lab)]

I note in the papers that have been provided for the debate that the Foreign Secretary has apparently been strongly converted to green energy, but that some of his Cabinet colleagues have not. Will the hon. Lady make every effort to get more people on the Foreign Secretary’s side in these matters?

[Laura Sandys]

I do not think that the Foreign Secretary has needed much persuasion or that there is any lack of will or determination in the Government. As I will continue to iterate, it is absolutely crucial that the policies we have put in place are sustained consistently into the future to attract the significant investment we need in the energy sector and the green economy.

If we look internationally, we will see that the so-called tiger economies are combining economic policies, subsidies, industrial focus and energy efficiency solutions to build their stronger economies. It is that co-ordinated model that I propose to the Minister today. Globally, there will be a race for resources, including energy, water and food. Energy consumption will grow by 33% over the next 20 years, with 50% of that growth coming from China and India. Even the Governor of the Bank of England has acknowledged that we must be cautious about our exposure to fossil fuels and that they could be considered a risk to financial security. Any country that is serious about future economic competitiveness, not least this one, will ensure that it limits its reliance on fluctuating and politicised energy inputs. Energy security, domestic production and low-input process re-engineering are not, in my view, things that it would be nice to have; they are a total necessity.

In many ways that creates a challenge for politicians. We need to come clean with the public and the private sector. We cannot con them that energy prices will come down today, tomorrow or even any time soon. The increase in global consumption is so marked that even the great shale gas discoveries in the US will not have a long-term impact on global costs. From the domestic perspective, Ofgem has calculated that domestic energy prices will rise by 60% by 2016.

It is the Government who will need to take an important role in the development of a long-term, secure and resilient energy supply. Frankly, there are some of us in the Energy and Climate Change Committee who believe that, whatever energy solution we adopt in the next few years, the Government will have to stump up a lot more money than they thought to keep the lights on, but that is a debate for another day. We need to deliver a strong and sustainable energy sector that delivers as much value as possible to the energy consumer and jobs and economic growth at the same time. To do that, we must look at energies in similar terms, whether tax incentives on fossil fuels or subsidies for the renewables sector.

[Caroline Lucas (Brighton, Pavilion) (Green)]

Does the hon. Lady agree that the £3 billion earmarked in the Budget to support the fossil fuel industry—oil and gas drilling—undermines precisely the green agenda she is setting out?

[Laura Sandys]

It does not undermine that agenda. We need to understand where subsidies, incentives and tax reliefs are deployed throughout our energy sector. I look to a future with a mixed energy economy that utilises all the different energy resources, but we must be transparent about where those subsidies lie.

Oil and gas exploration, for example, has been hugely beneficial to this country, as no one can deny, and that is why we subsidise the sector. Oil taxation measures, oil allowances, petroleum revenue tax safeguards, the ring-fenced expenditure supplement, the field allowance and coal investment aid are all important parts of the energy industrial strategy. As John Browne, formerly of BP, has said:

“People forget the government supported the oil and gas supply chain in its early days: with generous tax incentives, training programmes, strategic infrastructure; and supportive regulation.”

The Government are still doing so today.

[Mr Peter Lilley (Hitchin and Harpenden) (Con)]

Will my hon. Friend draw breath and think again? On this suggestion that we have been subsidising oil and gas, we have very high taxes on petroleum products and an extra tax on petroleum production called the petroleum revenue tax, so where does she get this “subsidy” from?

[Laura Sandys]

The International Energy Agency states that the fossil fuel sector is currently subsidised by $480 billion.

[Mr Lilley]

In what form?

[Laura Sandys]

In all sorts of forms, from production right the way through to—

[Mr Lilley]

Rubbish!

[Laura Sandys]

Well, by 2020 the subsidy will amount to $660 billion.

[Andrew George (St Ives) (LD)]

My hon. Friend will be aware that the noble Lord Stern, who produced a seminal work just a few years ago warning of the consequences of ignoring the impact of climate change, emphasised the way in which past Governments have given, and the current Government still give, tax breaks and other subsidies and support to the fossil fuel industry—to the disadvantage of renewable energy.

[Laura Sandys]

I thank the hon. Gentleman for his comment. I do not see the issue as a positive for one sector or another, but we must have transparency across all the energy sources that we as a country decide to—let us say—invest in or to support in any way.

[Ben Gummer (Ipswich) (Con)]

Without wanting to get tied up in the argument about subsidy, whether it existed or the lack of it, I note the certain truth that there was significant state investment in the oil and gas sector in the 1960s and ’70s, which was repaid only when the gas and oil started flowing. An analogy could be drawn now with the green technology industry, where we hope that such development might happen, too.

[Laura Sandys]

I thank my hon. Friend for his comments, and, exactly as he says, there was an emerging industry and significant Government support, which saw the opportunities that the sector could offer to our industrial policy and to energy security and resilience. On industrial policy, we also supported the car industry. In the ’80s we gave generous incentives to Nissan to attract it to the UK, and, when we look at our long-term, and now leading, role in the motor sector, we find that that has been a huge success.

So it is neither unusual nor wrong for government to incentivise energy investment or to support industrial development, and that is why I am pleased that this Government have put in place so many fiscal measures to do just that in relation to the new generation of energy sources and to investment in green technologies.

There are unfounded rumours that some in government have gone cool on the modern green agenda, but I know that not to be the case. I know that the Chancellor is committed to inward investment and to ensuring that companies such as Vestas reconsider their investment in north Kent.

I know that my hon. Friend who represents Sheerness—

[Gordon Henderson (Sittingbourne and Sheppey) (Con)]

Sittingbourne and Sheppey.

[Laura Sandys]

I know that my hon. Friend the Member Sittingbourne and Sheppey (Gordon Henderson), whose main port is Sheerness, is very keen to ensure that in the south-east we secure an important manufacturer of wind turbines.

I know that Treasury officials are totally committed, as they were to the oil and gas sector in the ’70s and ’80s, to attracting the new jobs and growth that are emerging from the fastest-growing business sector in the UK; and I am sure that all in government are focused on securing the £200 billion of funds to rebuild our energy sector in a highly competitive capital investment market, where policy certainty is fundamental to investment decision making.

All that the Government need to do to unlock those industrial opportunities is to sustain and reiterate their consistent and constant policies, with subsidies based only on proper evidence and with investment messages that resonate among the largest industrial companies in the world, such as Siemens and GE, and the large energy generators.

[Caroline Lucas]

I am grateful to the hon. Lady for giving way to me for a second time, but I cannot let pass what she has just said about the Government’s “consistent and constant” green energy policies, because they have been the exact opposite. Whether on solar or on wind, they have chopped and changed, and that is exactly why so many solar companies and wind companies are so furious—because they cannot plan for the future.

[Laura Sandys]

I totally disagree. On solar power and feed-in tariffs, in particular, we inherited a totally unsustainable policy and system, which needed to be addressed, and unfortunately we have spent the past couple of years recalibrating in order to ensure that we have in place sustainable, consistent and long-term policies that will provide investment certainty to such companies.

The UK is a great place to invest, and it has a strong vision for a modern, green and forward-looking economy. On the impact of our fiscal measures and support, we have a choice: to build that modern economy and compete with the forward-looking, future-proofing countries, such as South Korea, China and Japan; or to hold on to an outdated energy model that will not cost us any less but will leave us and our businesses stranded in the past.

[Several hon. Members]

rose—

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. I am going to have to introduce a time limit, but let us see how we go. If Members try not to use this much time, I shall start off the limit at eight minutes, but I may have to reduce it. How is that?

13:37

[Joan Walley (Stoke-on-Trent North) (Lab)]

I congratulate the hon. Member for South Thanet (Laura Sandys), who serves with distinction on the Select Committee on Energy and Climate Change, on bringing the debate to the Commons this afternoon, and I note that the Economic Secretary to the Treasury, the hon. Member for Norwich North (Miss Smith), is in her place, because if we really are going to make progress on this most important issue, we will do so only if the Treasury puts the whole issue at the core of its policy making.

It has always seemed to me perverse that we have a Green Book that is anything but green, so the time has come to ensure that the Treasury’s guidance on the national infrastructure programme, in particular, guarantees that every single policy is appraised and joined-up in taking further forward the agenda of securing more renewable energy and more energy efficiency.

I shall try very much to comply with the limit on speakers—

[Mr Deputy Speaker]

Order. The limit is eight minutes, and we will not go beyond that, so if we can please keep to it that will be much more helpful. I do not want to have to use a big stick, as I want to get everybody in.

[Joan Walley]

I, too, want everybody in the Chamber to get into the debate.

Let me bring to the attention of the House the two reports that the Environmental Audit Committee has produced, and which for the benefit of Members we have tagged on the Order Paper: the Committee’s twelfth report on “A Green Economy” and its sixth report on “Budget 2011 and Environmental Taxes”, which shows how we have examined the Treasury’s role in the matter.

We intended the two reports to be a starting point and an overarching basis on which the discussions that now need to take place throughout business, local government, the private sector and international development might be brought together, so that our policies—including what we do, and how we keep scrutinising what happens, in Parliament—can be tied to that agenda. We found that two years after making the commitment to increase the proportion of tax revenues accounted for by environmental taxes, the Government still have no strategy for achieving this commitment. In addition, they have not published their definition of an environmental tax. In our further follow-up inquiries, we will do what we can to obtain that definition and to scrutinise what is happening so that we get some real progress.

A further relevant aspect is the Rio+20 summit that took place last week. Its outcome was extremely disappointing given the lack of a highly ambitious outcome and follow-up action plan. However, all the different parties who were there, from business people, to legislators, to parliamentarians, to members of civil society were in absolute agreement that if the high-level leaders cannot come up with significant outcomes, everybody else has to raise their game. So it is with our Parliaments. I urge the Economic Secretary to demonstrate that she understands this issue by saying what she is doing through Treasury policy and in making sure in Cabinet meetings that there is a joined-up approach towards environmental taxes.

I want to raise issues relating to my own constituency, because we will not deal with this situation nationally or internationally unless we can deal with it locally as well. It is a matter of great concern to me that a large number of people in Stoke-on-Trent are living in fuel poverty. Indeed, of the 40,678 households in Stoke-on-Trent North, 10,120 are in fuel poverty, which is absolutely outrageous. It is a rate of 24.9%, which compares with the UK average of 18.6%—and even that is shocking. If ever there was a reason we should be getting support from the Treasury to address these environmental issues, it is that. We have a commitment to eliminate fuel poverty by 2016, and we will not achieve that unless we scale up everything that is done and look at how revenues can be reinvested so that whole communities see the importance of moving towards the renewables future that is so urgently needed.

I say this as someone who represents a constituency where the industrial revolution started because of our reliance on carbon.

[Ben Gummer]

Will the hon. Lady comment on the fact that the Labour Government spent almost £5 billion on trying to eradicate fuel poverty through various measures, with the consequence that fuel poverty went up in their 13 years in power?

[Joan Walley]

I am not going to get involved in any kind of partisan debate. Unless we can bring in measures that deal with fuel poverty in the short term and the long term, and get people’s commitment to work on this agenda instead of making political capital at the expense of everybody else, we will not deal with the problem.

In Stoke-on-Trent, we want to work with the coal authority to extract geothermal heat, which we see as one part of the solution in the context of all the other things that need to be done, to provide the jobs that are required, to provide training for people in the skills that will be needed for the new investment in renewables, and to see what we can do to bring about district heating schemes for city centre developments. We want to use the water that is underneath our city—albeit in what is, to date, an innovative way—to do what other countries, such as the Netherlands, have done to get the investment that is needed. We cannot do that without fiscal changes and incentives, and ways of getting innovation and new technology on board very quickly.

On fuel poverty, yes, we have had investment, but we have seen that piecemeal investments do not deal with the whole issue. That is why the previous Government invented the CERT—carbon emissions reduction target—scheme. If we deal with whole communities, often in areas of Victorian housing where there are huge issues with energy efficiency, it is possible to get the investment that is needed in one fell swoop. That is the kind of scaling up that is now so urgently needed.

We have aspirations to decarbonise our city. We have an untapped renewable resource, but at the same time we recognise the need for investment across a wide range of different industries and sectors. If this debate helps to take that agenda further forward, and if our Select Committees can examine and scrutinise every single action that the Treasury is taking to make these aspirations a reality, given the urgency of the need for greater energy efficiency, it will have been worth while.

13:45

[Mr Peter Lilley (Hitchin and Harpenden) (Con)]

I oppose the motion. I suspect that I will be the only person to do so. It is not because we cannot have green economy. We could—indeed, we once had a totally green economy. We relied on windmills to grind our flour, on watermills to saw our wood, on horsepower for transport, and on biomass—as burning wood is now called—for heat, but we abandoned those when we discovered that coal could fuel a steam engine, that oil could fuel the internal combustion engine, and that gas and nuclear could give us electricity. Since then, we have enjoyed huge increases in our material standard of living based very largely on comparatively cheap energy from fossil fuels.

The great Victorian economist, Jevons, pointed out nearly a century and a half ago why coal had ousted wind:

“The first great requisite of motive power is that it shall be wholly at our command, to be exerted when, and where, and in what degree we desire. The wind, for instance, as a direct motive power, is wholly inapplicable to a system of machine labour for during a calm season the whole business of the country would be thrown out of gear.”

Much the same can be said about the unreliability of solar and the discontinuity of tidal energy. My hon. Friends may want to return to a mediaeval economy that relies on unreliable, high-cost water, sunshine, wood and wind, but I do not. I am a conservative, not a reactionary. Of course, it may be that some time in the future new sources of energy will become available that are as reliable as, and cheaper than, fossil fuels—perhaps thorium reactors, nuclear fusion or cheaper battery storage, in conjunction with the intermittent renewables that we are developing at the moment. I will rejoice if those come about, but they are some way off.

[Dr Alan Whitehead (Southampton, Test) (Lab)]

Does the right hon. Gentleman accept that since the time of the quote he read out, we have had three further industrial revolutions, which makes his assumptions completely obsolete, and that we are in the middle of a further clean-tech and biotech industrial revolution that will make obsolete the previous assumptions on industrial revolutions? Has he taken that into account in his calculations?

[Mr Lilley]

I do not know which industrial revolutions the hon. Gentleman is referring to, but they certainly did not rely on our subsidising the use of more expensive energy to replace less expensive energy.

There are perfectly respectable, if not entirely convincing, arguments for saying that we have to replace cheap energy with expensive, less reliable energy to reduce carbon emissions, and that that is a price worth paying, to coin a phrase. However, the premise of this debate is that we can generate economic growth by introducing fiscal measures to subsidise and promote green energy. Let us be clear what that means: it means subsidising the replacement of comparatively cheap and reliable energy from fossil fuels with more expensive and intermittent energy from renewables.

[Andrea Leadsom (South Northamptonshire) (Con)]

Does my right hon. Friend agree that the debate should really be about whether we want to switch from higher-emitting to lower-emitting sources of energy, rather than having this complete confusion all the time about its being a question of carbon emissions or renewable energy? Renewable energy is very expensive, but there are plenty of sources of non-renewable energy that would be far less carbon-emitting.

[Mr Lilley]

My hon. Friend is quite right. We could halve our emissions by switching to gas from coal, but that does not please the greens.

[Andrew George]

Will the right hon. Gentleman give way?

[Mr Lilley]

I am sorry, but I have given way a couple of times.

To suggest that we can make ourselves richer by adopting more expensive energy is self-evidently ridiculous. Most of what has been cited as evidence of green growth involves creative accounting on a scale that would make Enron blush. First, there is the suggestion that a green sector has arisen, which allegedly employs 1 million people, produces goods and services worth £120 billion and, as the Deputy Prime Minister said the other day, contributes 8% to our GDP—although the House of Commons Library can find no source for that figure, other than the Deputy Prime Minister.

Those figures aroused my natural scepticism, so I tracked them down and found that they came from a Department for Business, Innovation and Skills report published earlier this year, entitled “Low Carbon Environmental Goods and Services (LCEGS)”. My scepticism was confirmed by the opening words, which explain:

“The definition of the LCEGS sector is the result of five year’s work”.

You bet it was! It carries on:

“The definition is broad”—

I can believe that—

“and includes activities that may appear under the overlapping headings of Enviro, Eco, Renewable, Sustainable, Clean Tech, Low Carbon or No Carbon (and any other we might have missed).”

That is not my comment, but theirs. It goes on:

“In the strictest sense it is not a ‘sector’ but a flexible construct or ‘umbrella’ term for capturing a range of activities spread across many existing sectors”.

What does the sector contain? A quarter of it or more has nothing to do with low-carbon activities at all, but relates to things such as sewage and water treatment, double glazing and controlling noise. Those are all excellent things, but they are not what we are talking about today and nothing to do with the low-carbon economy.

The biggest sector within the low-carbon sector looks promising: it is called “Alternative Fuel Vehicle” and employs 105,000 people, making it the biggest employment area in the low-carbon sector. I thought, “Terrific, we are employing 105,000 people making electric cars.” Sadly, however, we are not. I know one of the producers of electric vehicles and, alas, it is no longer producing them. It turns out that the name relates to mainstream and other vehicle fuels. We are not starting off some great manufacturing revolution through all this subsidy at all.

[Laura Sandys]

Will my right hon. Friend give way?

[Mr Lilley]

I will, because I intervened on my hon. Friend, even though it will use up my time.

[Laura Sandys]

The largest wind farm in the world is off the shore of my constituency, and 5,000 people are going through the port of Ramsgate on the construction side. The investment that has come in to the area has been significant—

[Mr Lilley]

That is fine, but my hon. Friend has read her speech. It is a question I was hoping for.

The growth of such sectors is either natural, in which case it is splendid, or it is the result of subsidies, in which case it is tosh. Subsidies can boost one sector at the expense of the rest of the economy, but we cannot make ourselves richer by providing subsidies. If a person moves a pound note from their left-hand pocket to their right-hand pocket, they are no richer. Subsidies can make us worse off, however. If we invest in offshore wind, which is twice as costly as conventional energy generation, we get half as much energy for a given sum of money. That makes us worse off, not better off.

[Joan Walley]

Will the right hon. Gentleman give way?

[Mr Lilley]

Only if the hon. Lady is going to prove that we make ourselves better off by producing half as much electricity for a given sum of money. She is not. If she gives up on that, I am glad.

The only way in which subsidies might conceivably generate an economic revolution is if we subsided the producers of goods and services that we could export;, but we are not allowed to do that under European rules. Instead, what we do is subsidise users, consumers and those who install generating capacity in this country. Unlike the Chinese and the Koreans, we are not allowed to subsidise those who manufacture wind farms or photovoltaic cells. We may want to, but we are not allowed to. The pretence that the subsidies that we are giving will promote infant industries is untrue.

[Andrew George]

Will the right hon. Gentleman give way?

[Mr Lilley]

No, I have given way lots of times, including when it has reduced my own time.

Let us give up on the belief that we will create a new industry. All we are doing is subsidising jobs in other countries, whose manufactured goods we import. It is quite clear from a look at the detailed figures in this bogus sector that we are not creating an infant industry.

I will now give way to the hon. Member for St Ives (Andrew George), who wished to intervene, because I have a couple of minutes to go.

[Andrew George]

I thank the right hon. Gentleman for giving way. He must address the fact that the low-carbon goods and services market, including the renewables sector that he is talking about, is worth £3.2 trillion a year, employs 28 million people and is growing at a rate of 4%. Either we turn our back on that as a market for the UK or we engage with it, in which case we have to have production capital here.

[Mr Lilley]

Exactly, but who is we? If we is the Government, the hon. Gentleman is proposing that the Government subsidise industries to go for that £3.2 trillion world industry. In fact, that is a bit of an exaggeration, but let us suppose that the figure is correct. The Government are not allowed to do what he wants because of European Union rules, which he supports. We cannot offer infant industries subsidies in this country, or indeed anywhere else in the European Union, although some of our partners may do so in concealed forms. We do not and cannot, so let us not pretend that we are doing so.

The subsidies that we deploy in this country go largely towards generating electricity by more expensive means than is necessary, which increases the cost base of our industry and makes it less competitive across the board. I hope that companies in this country will set up businesses in this sector, as in any other sector, to win exports across the world, but the Government are not allowed to support those companies, and let us not pretend that they are doing so when, in fact, they are subsidising imports.

13:56

[Dr Alan Whitehead (Southampton, Test) (Lab)]

It is a pleasure to follow someone who can be defined as the Don Quixote of this debate, both figuratively and literally tilting at windmills.

The answer to the speech we have just heard is that the green economy is about not just underwriting one form of energy out at sea, but putting the entire economy on a green footing in terms of resources, energy and demand, and including our homes and our vehicles. As the Government said a little while ago:

“A green economy is not a sub-set of the economy at large—our whole economy needs to be green. A green economy will maximise value and growth across the whole economy, while managing natural assets sustainably.”

That is what a green economy is about. Those are not my words, but the first paragraph of the Government document, “Enabling the Transition to a Green Economy”. There is precisely one paragraph in the document about what the fiscal incentives to move to that green economy might consist of, so this debate is timely. We must ask what fiscal incentives we should put in place to bring about those changes.

Our aim in the economic recovery should not be simply to return the UK economy to business as usual as it was before the crash; it should be consciously to use the opportunity provided by the need to reinvest and to re-engineer our economy to make decisive moves towards the green, sustainable, low-carbon economy that the first paragraph of that document suggests we should be aiming for. We need to be clear about what that entails in how we craft our fiscal policy.

The emergence of a green economy cannot be brought about just by changing the dials on a few economic levers; it is fundamentally asymmetric with what has gone before. Low-carbon sustainable energy, for example, does not have an investment or operational pattern that is anything like what we have been used to for the past 100 years. We cannot construct the next generation of low-carbon power plants and providers on the basis of what has gone before.

We can no longer rely on the assumption that we can generally predict what capacity will be needed and then work out how best to meet it. Future energy policy must be based on investing first in consciously reducing demand and then in decarbonising the remaining demand. In doing that, we have to move to a different paradigm of investment, because demand reduction is a process not an asset, and because low-carbon plants are capital intensive but mean on fuel. In other words, low-carbon plants take a lot of money to construct but, once constructed, use fuel that is either free or recovered from other processes. The model of low and basic construction costs and investment in sourcing, transporting and using fuel, and paying for it as we go, is no longer applicable.

We can no longer rely on the assumption that the purpose of investment in resourcing the economy lies in procuring material into the economy, using it and disposing of the consequences. A linear model of investment and expenditure no longer applies. We will need to move increasingly to a circular-resource economy, in which we do not throw things away—there will be nowhere to throw them. We still throw things away, however. Something like 520 million tonnes of material comes into our economy for domestic consumption, and 200 million tonnes leaves as waste. Only 20% of our material is sourced from secondary inputs.

The changes we need are about investing not just in the green economy, but in jobs. Contrary to what the right hon. Member for Hitchin and Harpenden (Mr Lilley) said, they are real jobs for the future. Moving our resource base to the 70% EU27 recycling target would create something like half a million jobs in the UK by the early 2020s.

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

I am listening carefully to what my hon. Friend says about jobs. If Hull becomes a wind turbine manufacturing site, 700 jobs will be created directly and up to 10,000 jobs will be created in the supply chain. Those are real jobs for real people in my constituency.

[Dr Whitehead]

My hon. Friend is absolutely right: not only are the jobs real, but they are long-term, skilled jobs. Other countries are investing heavily in such jobs as that sixth-wave energy and industrial revolution takes off across the world.

My reference in an intervention to the several industrial revolutions since the horse and cart and steam relates to the fact that we are now beyond the information and technology revolution and moving into the clean-tech biotech revolution, which is taking off throughout the world. Who is the world leader in clean energy? We talk about its pollution and energy profligacy, but it is China—a country that is clearly engaged in a conspiracy of useless non-job creation in the green economy.

[Mr Lilley]

I pointed out that the Chinese are allowed to subsidise their manufacturers of, for example, wind turbines, whereas we are not. Is the hon. Gentleman saying that we should subsidise such manufacturers, and how does he propose to alter the EU regulations to enable that?

[Dr Whitehead]

As it happens, EU regulations enable the underwriting of investment in technology that will lead to a lower-carbon economy. The renewables obligation is regarded as state aid, but such investment can be underwritten precisely because it brings new technology to market, reduces its costs and increases its prevalence. That is why the Chinese invested £34 billion in clean energy in 2009, compared with £18 billion in the US. As the hon. Member for St Ives (Andrew George) has said, the goods for low-carbon markets are expected to reach something like £4 trillion by 2015. Put simply, if we are not in that market, we will be sidelined not temporarily, but permanently.

Curiously, the recession gives our country an opportunity to be far more proactive than we might otherwise be. The cost of capital is low and liquidity is high because of the paradox of thrift: there is no danger that investment in green goods, services and plants will crowd out other forms of investment. Fiscally, we can go for it, but in view of the asymmetry, there must be clear and long-term signals.

What might we do? We could invest in decarbonising our homes, for climate change purposes and for demand reduction purposes. We should insulate homes to make them fuel poverty-proof—as we know, the green deal will only scratch the surface. We will get £4 billion per annum over the next 15 years from the EU emissions trading scheme, carbon trading and the carbon floor price. As a fiscal measure—without hypothecating what is in the tax pot—we could invest a large amount of that money in ensuring that our homes are energy-efficient.

We should invest in low-carbon energy provision in the way that I have outlined. If the state wills the ends of that provision, it must underwrite it. That need not mean putting money in the pot, but it does mean underwriting at least some of the risk. It is ridiculous, for example, that there is no state backing for the contracts for difference that will replace the renewables obligation under the Energy Act 2011, and that no demand-side measures, underwritten by feed-in tariffs, are being introduced under the Act. We can get long-term value by taking such fiscal action.

Fiscal policy need not involve underwriting money. Holding the ring on risk and bringing new forms of low-carbon power home is key. To get us to a position in which we have a substantial number of ultra-low carbon vehicles on the road, why not have a “feebate” system, whereby we use, as a fiscal measure, additional fees on high-carbon consuming vehicles to underwrite the new low-carbon vehicles that come on stream? We have a target of 1.7 million ultra-low-carbon vehicles on our roads by the early 2020s. That is the sort of measure we should undertake.

Above all, we should get real about the green investment bank. The bank will have £3 billion as a fund until 2016, or perhaps later, depending on whether the Chancellor decides that it is ready for investment as a whole, yet last year KfW, the German public green investment bank, invested £24 billion—more than a third of its £70 billion —on energy and climate change measures. We can do that if the green investment bank is a bank, but it needs the ability to raise bonds and money at an early stage. That is the sort of fiscal underwriting we need for this green energy, resource and social revolution that we are going through. We need to get on with that urgently, and I urge the House to support the motion to assist with that process.

14:06

[Gordon Henderson (Sittingbourne and Sheppey) (Con)]

We will hear in the debate arguments for and against investment in renewable energy, although I can see only one person in the Chamber who is against such investment. Those on both sides of the argument would probably agree on two things: the first is that there is only a finite supply of fossil fuels, and the second is that Britain relies too heavily on foreign imports for the energy needed to power its homes and businesses.

Both factors are problems that need to be addressed if Britain is to have long-term energy security. Hon. Members have a choice: we can leave the problem for our children and grandchildren to solve in 40 or 50 years’ time, when it might be too late to find a solution, or we can get to grips with the problem now and ensure that future generations can switch on their lights.

The problems I mentioned are interlinked and can be solved only by finding replacements for the fossil fuels on which Britain has become too dependent. There are a number of options, including nuclear power, shale gas, clean coal technology, biomass energy, anaerobic digestion, ocean wave energy, tidal power and wind energy. The sensible long-term strategy would be not to major on any one of those alternatives, but to establish a national plan that draws in power from all of those sources to supplement the reserves of oil that will become increasingly scarce and expensive over the next few decades.

The advantage of establishing an alternative energy industry is that most of the components needed to generate power could be sourced in Britain. That is particularly true of the renewable energy sector. As an island, we have the advantage not only of a limitless flow of water, but also of access to all-year-round wind, particularly offshore, which leads me nicely to that part of the green economic sector on which I would like to concentrate.

Many oppose an expansion in Britain’s wind capacity. They either say that wind turbines will never produce enough electricity to make them viable, or object to the use of Government subsidies to encourage investment in wind energy, or both. I would have more sympathy for the first argument if wind turbine technology had stood still, but it has not. For instance, the new V164 offshore turbines, which are being developed by Vestas on the Isle of Wight, each generate 7 MW of electricity.

It was with deep regret that we learned one week ago that Vestas has decided not to renew its option for land at the port of Sheerness, which had been set aside as the site for a factory that would have produced the blades for the V164. That factory would have created 2,000 new jobs for my constituency, and many of them would have gone to people living in my constituency. Given that my constituency has a higher unemployment rate than the average south-east constituency—in Sheerness East, where the factory would have been built, it is more than 11%—the decision by Vestas has been another blow to the morale of my constituents.

In many ways, Vestas’ decision is surprising, because Sheerness is an ideal location for a wind turbine factory, which is why I will be working closely with Swale borough council, Kent county council and the Department for Business, Innovation and Skills to attract another manufacturer to the Isle of Sheppey. Full planning permission is in place, and we have the right infrastructure and a willing and ready work force; all we need is somebody willing to take Vestas’ place.

[Mr Lilley]

Will my hon. Friend confirm that the one thing that none of those organisations can do is offer a subsidy to anyone to come to his constituency to produce wind farm components? It might be desirable that they should—it would certainly be a better use of money than subsidising rich landowners to install wind farms—but it is not the case. Can he confirm that?

[Gordon Henderson]

I can confirm that none of those organisations can offer such a subsidy, but that is not to say that we cannot do something to attract an alternative.

[Andrew George]

The hon. Gentleman will surely acknowledge that one thing that the sector, particularly the production sector, wants more than anything else is the underbelly of a functioning sector—one where there is a market, even if only initially in the UK, and certainty. That is one thing that the Government can and need to provide.

[Gordon Henderson]

I agree, and I shall come to that in a moment. Vestas has not given any reason for its decision, so we can only speculate on why it decided to pull out of Sheerness. A few months ago, it announced that it was slowing down development of the V164 to take account of the current economic conditions and the needs of their potential customers, which is what the hon. Gentleman touches upon. As I said, though, I will return to that point later.

That slow-down has resulted in the slipping of the date for erecting the prototype VI64 from the end of 2012 to 2014. I can only assume that Vestas took the decision—quite sensibly from a commercial perspective—that it did not want to lay out more money in an option on land for which it had no need for the foreseeable future. What will happen in 2014 is anybody’s guess, and that is a big worry both for my constituents and those of my hon. Friend the Member for Isle of Wight (Mr Turner). It is still conceivable, I suppose, that Vestas will come to Sheerness in 2014, but it will only proceed with its project if it can obtain firm orders for the VI64, and no potential customers will commit to those orders until they are clear about the Government’s commitment to offshore wind energy. Currently, however, the Government’s position is not clear, so I would like it to be made clear.

That brings me to the issue of subsidies, which has been raised already. As a Conservative, I am not naturally in favour of taxpayers’ money being used to help any business. If a product is good enough, it should be able to stand on its own two feet. I accept, however, that strategically Governments often use taxpayers’ money to invest in research and development in some industries, particularly where such developments are in the national interest—the defence industry is a case in point, of course. I believe passionately that securing energy supplies into the next century is in our national interest and that it will benefit Britain if taxpayers’ money is used to encourage the development of alternative sources of energy, whether nuclear power, shale gas or offshore wind. For that reason, I will gladly support the motion.

14:14

[Kelvin Hopkins (Luton North) (Lab)]

I defer to the previous two speakers on their knowledge of energy matters, but I have some points I wish to make. I was interested in the suggestion from my near neighbour, the right hon. Member for Hitchin and Harpenden (Mr Lilley), who seems to be strongly in favour of getting rid of the EU’s restrictions on state aids. I completely agree. I am completely in favour of state aids, where appropriate, and we should not be constrained from applying them by the EU—but then my Eurosceptic views are, I think, fairly well known. My hon. Friend the Member for Southampton, Test (Dr Whitehead) made a thorough, erudite speech that I will read in detail with interest later.

My concern is about energy conservation. Massive investment in energy conservation has everything to commend itself, while investment in nuclear generation has nothing to commend itself. With energy conservation, every home, office, public building and factory in the country can save enormous amounts of energy, so rather than generating energy, we need to conserve it. It is cheaper, too, particularly for the less-well-off living in constituencies such as mine, where some people still do not have roof insulation—aerial photographs at night show the infrared glow from those homes. These are poor people who cannot afford to invest, so it is something that the Government have to attend to.

Investment in energy efficiency would be enormously cheaper than focusing simply on generation. The Association for the Conservation of Energy has produced a report in the past few months demonstrating that such investment would be as much as £1 trillion cheaper over time than investment in generation and would create hundreds of thousands of jobs. Many of those jobs, in home insulation, would not be high skilled, so a lot of unemployed people, particularly young people, in my constituency who do not have high skills would be ideally suited to working in the sector. We desperately need these sorts of jobs at every level.

Energy conservation would be labour-intensive, rather than capital-intensive, which is what nuclear investment is about. I have been informed this week that officials in the Department of Energy and Climate Change are doing a deal that will be massively beneficial to EDF. All the other energy companies have dropped out of the nuclear programme in Britain, leaving EDF the monopoly supplier. It is effectively owned by the French Government—they own 85%—and our DECC officials are so obsessively pro-nuclear that they are going to strike a deal that will effectively subsidise EDF to the tune of £5 billion. That money will go to EDF, a French company, and will be used to benefit French taxpayers, French consumers and, no doubt, the French nuclear industry as well. It will not benefit us at all. That £5 billion could be spent in many other ways, particularly on energy conservation.

The right hon. Member for Hitchin and Harpenden is right that we need a base provision of core generation for peak times, but if we invest heavily in green energy of every kind in order to maximise energy provision in other ways, we could reduce that core requirement to its very lowest level. Germany has already done it. I understand that it has invested gigantic amounts in all sorts of alternative energy, such that, on warm summer weekend days, they can effectively shut down their power stations and tick over on the alternative energy provision.

[Zac Goldsmith (Richmond Park) (Con)]

The hon. Gentleman is absolutely right about energy efficiency and nuclear power. I echo everything he has said. Will he join me in urging the Government to put more emphasis on energy efficiency in the proposed electricity market reforms, the original intention of which was to introduce the concept of “negawatts”, which would put energy saved on a par with energy generated and therefore revolutionise the energy market and fundamentally change the dynamic?

[Kelvin Hopkins]

I thank the hon. Gentleman for his informed intervention. The problem is that the energy companies have been far too influential in DECC and have been able to bend the arms of even our Secretaries of State, because the central core of government decided years ago that it wanted to keep the companies and nuclear power on side. Those companies make money out of selling energy, not conservation or solar power at a local level; they do not make a profit out of that kind of energy provision. Indeed, we must have strong Government intervention to achieve that. In Germany, they have done it; with their feed-in tariffs being brought in years ago, the Germans are effectively decades ahead of us. In just a decade or two, half of their energy will be provided by alternative means. We are talking about enormous proportions of energy, and we have to go for that.

It has been said so many times, but we have wind on our shores and we are surrounded by sea and tides. We are aware of a positive move towards using the Severn barrage, that will produce enormous amounts of our energy, but there are other forms of generation, too, which could be flexible and provide us with base load, such as generation by burning organic waste, or anaerobic digestion. Unlike with wind and sun, we can turn that on and off. If we invested heavily in anaerobic digestion, so that all the organic waste was used to produce methane, which could be used either directly or to generate electricity, it would provide a massive contribution to the core base load of our electricity and energy provision. We have to go in this direction. We have to resist the power and controls of the energy companies and go for an alternative energy and green energy society.

I congratulate the hon. Member for South Thanet (Laura Sandys) on securing this important debate. If we do not move in this direction, we will be in serious economic trouble as well as environmental trouble.

14:21

[Caroline Nokes (Romsey and Southampton North) (Con)]

I add my congratulations to those of other colleagues to my hon. Friend the Member for South Thanet (Laura Sandys) on securing today’s important debate. As a member of the Environmental Audit Committee, I am conscious—as our Chair, the hon. Member for Stoke-on-Trent North (Joan Walley), who is no longer in her place, mentioned earlier—of the need to have a green thread running through every area of Government policy. That, of course, gives us the opportunity to have a very wide-ranging debate today. I am conscious, however, of the number of Members who wish to speak, so I shall try to keep my comments brief and restrict them to just two areas.

First, we have seen over the last few days the importance of fuel tax as a fiscal measure, and we are all well aware of the impact of high fuel prices on our constituents—not just on motorists, but on the consumers of goods transported by road, which in this country is, of course, absolutely everything. The carbon emissions from road transport make up a significant proportion—over one fifth—of the UK’s total CO₂ emissions. Passenger cars, in particular, emitting in the region of 76 million tonnes of CO₂ annually, contribute 13% of all CO₂ emissions.

Clearly, this is an area where Government policy must be used constructively not only to encourage shifts in modes of transport, but to encourage road transport users to look for cleaner, greener alternatives. I am a big fan of differential rates of vehicle excise duty, as there is nothing that concentrates the mind of the user quite so much as choosing to drive a car that attracts a lower duty tariff. I urge Ministers to ensure that ultra-low levels of duty are retained for the cleanest and most efficient engines.

I do not wish to dwell today on passenger transport and the private car, so I shall move on to road haulage and the freight industry. This is an area of policy relating to green transport, which is a matter of concern to me, and I have asked a number of parliamentary questions on the subject. I particularly emphasise today the duty differential for used cooking oil biodiesel, which expired in March this year. I appreciate that biodiesel is currently little used in the passenger car sector, although it does have potential; it is far more significant in freight transport, which accounted for 26 million tonnes of CO₂ emissions in 2010.

Without the support of the duty differential, many biodiesel users will inevitably switch back to fossil fuels, resulting in higher emissions and risking the loss of up to 3,000 jobs in the low-carbon economy. The double certificates allowed under the renewable transport fuel obligation look unlikely to be able to support this sector, particularly given that recent certificate values have fallen as low as 10p. While this industry is maintaining an ongoing dialogue with the Minister’s colleagues in the Department for Transport, looking to find an alternative solution, Treasury support and awareness is also vital.

The second area of policy I wish to highlight is house building. The hon. Member for Luton North (Kelvin Hopkins) mentioned the efficiencies that can be made through better insulation. Better use of water should also be highlighted, as should better and more efficient boilers. Linden Homes, a house building company that operates in my constituency, has come up with an innovative way to help the Government to progress a zero carbon policy. Its proposal to create a “new homes sustainability bonus”, has the potential to contribute towards a zero carbon policy in a sustainable and affordable way, at a time when the industry faces significant challenges.

At present, all new homes constructed in the UK are required to meet stringent Government energy and water efficiency standards—and rightly so. This company’s idea, as part of the policy mix for national carbon reduction, is that developers could, for all new units built from 2013, contribute a new homes sustainability bonus paid into a central fund, which would then be used to find the most cost-effective ways to reduce carbon within the UK’s existing housing stock, which chronically falls behind new home standards and has significantly higher energy and water consumption. Only 40% of all homes currently have energy-efficient boilers.

[Dr Daniel Poulter (Central Suffolk and North Ipswich) (Con)]

My hon. Friend is making a very good point about existing housing stock, which is the majority of the stock in this country. Retrofitting and improving energy efficiency in those homes is good not only for business, but for consumers, particularly for those on fixed incomes such as the frail elderly and people in other vulnerable groups.

[Caroline Nokes]

I thank my hon. Friend for that comment. He makes exactly the point I was moving on to.

Last year, the Environmental Audit Committee went to visit the Sustainable Building Centre in Leamington Spa, where we learned that if everyone in the UK with gas or oil central heating installed a high-efficiency condensing boiler, we would save more than 6.5 million tonnes of CO₂ every year—and that is only one aspect.

[Kelvin Hopkins]

The hon. Lady makes a good point, but a 20% VAT charge is still made, when it could be only 5% VAT. That would be one simple subsidy to encourage people to invest in better and more efficient boilers.

[Caroline Nokes]

I thank the hon. Gentleman for that, but my point is that if home developers were obliged to pay into a central fund, we could start to ensure that people in social housing and those on the lowest incomes do not merely think about cheaper energy-efficient measures, but have a grant to enable them to achieve that. The hon. Gentleman mentioned insulation earlier, but improvement is possible from double glazing, too.

Particularly at a time when my constituency and parts of the south-east are under water stress, we must start to look at finding better ways to use our water. We need to be more efficient through rain water harvesting, using grey water and taking simple measures to improve sanitaryware systems, so that the cistern from the lavatory uses less water. All these measures could be done very cheaply indeed.

According to the Energy Saving Trust, each person in the average UK home currently uses 150 litres of water a day. Level 6 of the code for sustainable homes seeks to reduce that usage to just 80 litres—but, significantly, that applies to new-build properties. As I have already said, however, they are a tiny proportion of our housing stock, and far greater savings—both in litres per day and cost to the consumer—can be achieved through working on older properties.

Independent research has indicated that by shifting the focus on to the existing housing stock of 25 million homes, rather than on the already energy-efficient new-build sector, great efficiencies and more value for money can be delivered for the nation as a whole. That scheme would mean that existing home owners would see reduced energy bills, social housing associations would benefit from reduced maintenance costs and local employment would receive a boost, thanks to the number of trades people needed to carry out the work. New home buyers would be spared additional costs, which would in turn help to ensure the viability of many development projects—a critical factor for the UK economy given the already chronic under-building due to economic constraints.

[Mr Robin Walker (Worcester) (Con)]

I congratulate my hon. Friend on her speech. She is making some important points about both water and heating, and about the work that can be generated. Does she agree that it is vital for the Government, when designing schemes, to work closely with the installers, who are key to people’s decisions about how to implement these policies in their homes?

[Caroline Nokes]

My hon. Friend is right. The Government must work hand in hand with industry and the installers to ensure that we come up with schemes that not only look good on paper, but work in the real world.

Evidence suggests that if the hearts and minds of consumers are to be won over to energy efficiencies, there must be demonstrable cost savings for them. In response to a survey conducted in April this year, 41% of people said that they would be prepared to pay nothing more to make energy efficiency improvements in their homes. A scheme of this kind has the potential to provide grants for householders, enabling work to be done at no cost to them while also saving money, reducing emissions, and helping the Government to meet their targets. Surely that it is a win-win situation.

I have mentioned water efficiency. A company operating in my constituency, i2O, has developed the advanced pressure management solution, the world’s first system to monitor and control water pressure through a pipe network. It is an extremely successful design which has been deployed throughout the world, and is most widely deployed to regulate water flow and manage leakages. Last month South East Water awarded the company a £1.5 million contract to help to reduce its leakage problems. In view of last month’s drought conditions throughout the country, I am sure that such technology will be needed more and more, and I am pleased that South East Water wanted to install the system as soon as possible. I urge the Minister to support companies such as i2O which are employing innovative and sustainable ways of managing water levels and distribution.

Let me again congratulate my hon. Friend the Member for South Thanet on securing the debate. I look forward to hearing the Minister’s response.

14:30

[Caroline Lucas (Brighton, Pavilion) (Green)]

I congratulate the hon. Member for South Thanet (Laura Sandys) on securing this important debate.

I am genuinely pleased to observe a fight-back from many Tory Back Benchers who are now trying to make the Government see the huge economic and employment benefits of a green economy, as well as the obvious environmental benefits. The scale of the challenge that they face was amply demonstrated by the speech of the right hon. Member for Hitchin and Harpenden (Mr Lilley), who sounded as though he was still living in the dark ages.

I do not know where the right hon. Gentleman has been for the past few decades, but when I last looked, Germany did not seem to be an economy that was struggling. Germany is doing incredibly well, and it is being built on an economy that is light years ahead of ours in terms of the use of the green economy. Let me remind the right hon. Gentleman that we ended the stone age not because we ran out of stones, but because we found a cleaner, more efficient way of behaving. In the same way, we will leave the fossil fuel economy behind because we now see cleaner, more efficient ways of behaving.

As for subsidies, there is a world of difference between subsidies that are time-bound until new technologies reach, in this instance, grid parity, and subsidies that have been going on for decades—as they have in the case of nuclear and fossil fuels—and are driving us ever closer to climate catastrophe.

Much of the debate has rightly focused on fiscal measures. Three years ago, the green fiscal commission revealed that a “polluter pays” tax shift would provide a significant boost for UK low-carbon jobs, as well as increasing competitiveness. It suggested that such a measure would reduce emissions by more than 30% by 2020, that it would create about 455,000 jobs, and that it would receive a great deal of public support.

It is important to bear in mind how widespread that support potentially is. Let me quote these words:

“I don’t underestimate how difficult it will be to rebuild public confidence that green taxes are genuine environmental policy… not just stealth taxes… I am… determined to rebuild this trust… As leading green… Professor Paul Ekins has rightly pointed out, this type of green tax switch might be termed a ‘win-win-win’ outcome… The time for action is now. Future generations will not forgive us if we fail.”

Those are all words with which I agree, but if a week in politics is a long time, four years is evidently an eternity. Those words were spoken by the present Chancellor to a Green Alliance conference back in 2008. I agree with all his words from 2008, but unfortunately they have not been matched by any real action since he has been in a position to put them into action.

I hope that today’s debate will enable us to remind the Chancellor of his words of four years ago, and help to convince him that he should throw his weight behind the UK’s aim of becoming a world leader in low-carbon industries. If he does not believe in the environmental reasons for such action, he certainly ought to believe in the economic and employment benefits. I also hope that we shall be able to persuade him to convince the Treasury that its flagship “green bank” ought to be given the power to borrow as soon as possible.

More broadly, I should like the Chancellor to consider measures such as “green quantitative easing”. I was interested to note that even the former Government chief scientist Sir David King has echoed my calls for green conditions to be attached to the billions of pounds that are currently being poured into our banks. I think that the money should be going directly into the economy rather than into private banks, but wherever it is going, the Government should at the very least ensure that green conditionality is involved, so that we can ensure that it goes into low-carbon infrastructure. Crucially, they should also recognise that the low-carbon economy is far more labour-intensive than the fossil fuel economy that it will replace, so it makes good employment sense to invest the funds in green rather than fossil fuel measures.

The one thing businesses are united in calling for is certainty. The CBI says about low-carbon investment:

“Businesses need, above all else, policy certainty, consistency and clarity over the long-term”,

yet that has been conspicuous by its absence under this Government—demonstrating a failure of leadership by them. The sad news about Vestas reversing its previous decision to invest in the wind turbine manufacturing plant at Sheerness is just the latest casualty of the Government’s failure to provide that most basic condition.

[Nigel Adams (Selby and Ainsty) (Con)]

Is the hon. Lady aware that in the last three days Vestas has also decided to close a manufacturing plant in China?

[Caroline Lucas]

It does not make me feel any better to know it is also closing plants in other parts of the world. It has clearly said one of the reasons why it did not go ahead in Sheerness was that it did not have enough orders for turbines on the order book. If that is a problem here in the UK, we should be addressing that, rather than worrying about what is happening in China.

One measure that would provide huge and tangible benefits both in my constituency and the rest of the UK is a massive investment in making the UK housing stock super-energy efficient. As others have said, that would not only be good in terms of getting our emissions down and creating lots of jobs; crucially, it would help tackle fuel poverty as well. This measure should be funded not through more levies on energy bills—as the Government plan, and which is inherently regressive—but from using funds such as the revenue from the carbon price floor and auctions of carbon emissions permits through the EU emissions trading scheme. That would have benefits in job creation, tackling high energy bills and achieving rapid emissions cuts. Some 118 Members have now signed the early-day motion on the Energy Bill Revolution campaign, which calls for precisely this step.

Members support that EDM because they know that, sadly, as it is currently designed, the green deal policy instrument is extraordinarily weak and the energy company obligation part of it—the bit that is supposed to be tackling fuel poverty—looks set to fail miserably both against the Government’s own objectives and in terms of doing what is needed to cut carbon emissions and end fuel poverty. The truth is that the final shape of that fuel poverty package could result in a 50% drop in the funding targeted at low-income and financially deprived households. There will be far less money in the ECO than there is in the measures that are being phased out—the carbon emissions reduction target, the community energy saving programme and Warm Front.

[Dr Daniel Poulter (Central Suffolk and North Ipswich) (Con)]

I think the hon. Lady is being disingenuous, to say the very least, in respect of this Government. It is because of the policies of this Government that we are seeing investment in increasing numbers of offshore wind farms, not only off the Kent coast, but, as I am sure my hon. Friend the Member for Waveney (Peter Aldous) will point out in his speech, off our coast in Suffolk. Will the hon. Lady at least accept that there have been many good advances in green energy—some of which are being delivered right now in Suffolk?

[Caroline Lucas]

That has probably happened in spite of Government policy, not because of Government policy. [Interruption.] I hear the muttering on the Government Benches, but what I say is true. The measures of investment figures show that under this Government investment in green technologies has decreased.

[Dr Poulter]

rose—

[Caroline Lucas]

I apologise, but I will not give way again, as I do not have much time left.

For many low-income households the green deal financial mechanism simply does not stack up. [Interruption.] The mechanism is based on loans with interest rates of between 6% and 7%. That creates the risk that these loans will be taken up by middle-class and well-off households, which might be able to afford to take them up without needing any support, rather than by less-affluent families with next-to-nothing in their pockets. Although there are limitations in respect of this market mechanism, if we are going to use it, we will at least need support to bring interest rates down to a more realistic level—as Germany has done through the development bank, KfW.

Renewable energy enjoys massive public support. That is true even of wind—although judging by the outcry from some Tory Back Benchers, we would be forgiven for assuming otherwise. In November, a YouGov survey found strong support for renewables, with 60% of people supporting wind power subsidies. The Prime Minister said in his half-speech at the clean energy ministerial meeting in April that he passionately believed that the rapid growth of renewable energy was vital to the UK’s future, but, sadly, his Government’s policies do not reflect those warm words. Instead, we hear rumours that he and his Chancellor are seeking backroom deals for a 25% cut in subsidies to onshore wind. Any reduction beyond the proposed 10% cut to wind subsidies would fly in the face of environmental and economic common sense, jeopardising the future of both onshore wind and investment in other renewables across the country, as well as the thousands of jobs they could bring.

The solar feed-in tariff fiasco provides another example of coalition Ministers creating harmful uncertainty. As one solar company in my constituency described it, the industry has had to endure a series of “unsettling knee-jerk changes” that have undermined not only investor confidence, but public confidence in the solar industry. Solar energy has huge potential in the UK and it is a tragedy that we are not supporting it more.

Marine energy also has massive potential. With the right support the UK industry could seize almost a quarter of the world’s potential market, according to the Carbon Trust. That would be worth an estimated £29 billion per annum to the UK economy by 2050 and would support more than 68,000 jobs. Sadly, that potential looks hugely unlikely to be realised, given that we have a Government Budget with a £3 billion tax break for more offshore oil and gas drilling—

[Mr Lilley]

rose—

[Caroline Lucas]

I will not give way, because I am running out of time. I am sorry. I was going to say that we also have a draft Energy Bill that threatens to usher in a new dash for gas.

Finally, in my last 40 seconds, I wish to pick up on the way in which “accelerate green growth” is being used in the motion, as we need to be a little clearer about that. Of course we need faster growth in some sectors of our economy, including in renewable energy and energy efficiency, but we must stop pretending that we can have infinite growth on a planet of finite resources. The current economic crisis gives us the opportunity to change direction and get on the path to a very different kind of economy, one that it is not measured solely by GDP. The problem with GDP is that it measures everything in cash terms; it does not measure what is growing, and it does not give us any sense of the quality of the economy and whether it is delivering true well-being.

[Several hon. Members]

rose—

[Madam Deputy Speaker (Dawn Primarolo)]

I call Nigel Evans. [Laughter.] I do apologise. I meant, of course, Nigel Adams.

14:41

[Nigel Adams (Selby and Ainsty) (Con)]

That is not the first time I have been mistaken for Nigel Evans, and I see that as a great compliment, so thank you, Madam Deputy Speaker.

I am pleased to be contributing to this debate on the green economy and the fiscal support it receives. Like many other hon. Members, I congratulate my hon. Friend the Member for South Thanet (Laura Sandys) on securing it. It is particularly important in my constituency, because of the substantial investment being made in sustainable biomass and carbon capture. Drax and Eggborough power stations are based in my constituency, as is Kellingley colliery, the deepest coal mine in the UK. Drax currently produces more than 7% of the UK’s electricity, having generating capacity of just under 4,000 MW. It has been investing in research and development and in new facilities to co-fire with an increasing percentage of biomass. It has proven that its current plant can successfully operate with 12.5% co-firing, and there are plans to increase that to 20% and to build a new power station that would be fired with 100% biomass. Eggborough power station proposes to convert its 1,960 MW generating capacity to run entirely on biomass.

Those are the big wins we need if we are to secure our targets for reducing CO₂ emissions and ensure that the green economy flourishes. Biomass results in 80 to 90% less net CO₂ emission than coal, and these are the facilities we need to produce power when we need it and not just when the wind blows. They also currently provide secure employment for a large number of people.

We are talking about world-leading companies that have proven that their technology works and that have solved the supply and materials handling problems. However, they cannot provide a solution on financial viability without having a UK policy framework that supports it, which is why I am delighted that we have a Treasury Minister here with us today. Drax is already the UK’s largest producer of renewable energy, even without yet running its current renewable capacity to the full—the current renewables obligation framework does not make it financially attractive to do so. Drax is willing and able to go further, but the policy framework must support rather than hinder it.

Unlike onshore wind, the transition to biomass in my constituency enjoys considerable local support. The local labour force has the expertise to support the plant and sees it as a great new employment opportunity. Public support is important and these projects enjoy support rather than enduring local opposition. I am afraid that the same cannot be said of onshore wind farms, which are proposed in many numbers in my constituency. There is widespread knowledge about power generation and I am repeatedly reminded that more than 3,000 onshore turbines operating last year, which received nearly £400 million of subsidy, produced only 3.3% of the electricity consumed.

Such a level of subsidy for wind, which proudly claims to be the cheapest form of renewable energy, is not a particularly good use of the money that is being levied from the consumer, driving more of them into fuel poverty every year. Electricity that can be produced as and when required, at any time of the day or night, must be worth more than electricity produced only when the wind blows.

Electricity generated near to the industry and homes it supplies via a major node on the grid must be worth more than power from the wind generated in some remote location. Electricity generated competitively with a local labour force must be worth more than electricity that depends on imported turbines with low UK labour content. We should address those issues and I appeal to the Economic Secretary to the Treasury to allocate our financial resources accordingly.

14:46

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

I, too, congratulate the hon. Member for South Thanet (Laura Sandys) on securing the debate. When the coalition came to power, it talked about rebalancing the economy, including moving from services to manufacturing, moving from London and the south-east to the regions and moving towards a more low-carbon economy. In my area of the world, the Humber region, the green economy is one way in which we can see growth brought back into the local economy.

I understand that three of the world’s largest offshore wind farms are around the UK and Hull is particularly well placed for the third round, as we have the Hornsea and Dogger Bank areas of the North sea. I want to talk about the benefits to my area of the green economy and about why it is important that the Government are clear in their approach.

At the moment, the Hull and Humber area is working up a proposal for a green port at east Hull. The proposal is for Siemens to come to the port and set up a wind turbine manufacturing site for turbines that could then be used out in the North sea. We are well placed because of the deep channels in the Humber estuary and the sailing time to the proposed Hornsea and Dogger Bank wind farm areas. At the moment, we are talking about a £250 million investment in Hull, with the further investment of £100 million through the supply chain that we hope will come to the city when Siemens arrives. I must say to the right hon. Member for Hitchin and Harpenden (Mr Lilley), who is no longer in his seat, that my understanding was that a financial package was available to support such investment in the city in recognition of how important the development was not just to my city but to the wider economic situation in the Humber and around the United Kingdom.

[Laura Sandys]

I think the regional growth fund has given support to many of those companies as they open up their investment, to secure investment in Hull as well as in Sheerness. Perhaps the hon. Lady could provide clarification on that point.

[Diana Johnson]

I am grateful to the hon. Lady for her intervention. I will talk about the regional growth fund, but under the previous Government funding was made available for ports so that they could develop projects such as the wind turbine manufacturing that I mentioned. We need to recognise that not only the previous Government but, to give them some credit, this Government have taken steps to support the green economy through wind turbine manufacturing. I think it is a combination of the two things. I do not think we can deny that the previous Government did a lot around the green economy, with the very important legislation in the Climate Change Act 2008, which was the first of its kind in the world. I will come to the regional growth fund in a moment.

The North sea has been called the “Saudi Arabia of renewables”. There is huge potential for growth in the economy. Work on Green Port Hull is going exceptionally well and we are moving steadily, I hope, towards Siemens actually signing on the dotted line later this year. I pay tribute to the Associated British Ports manager, Matt Jukes, as well as Lord Haskins, who has been the chair of our local enterprise partnership, Councillor Steve Brady at Hull city council and Ian Kelly at the chamber of commerce. This has been an example of the public sector and the private sector working successfully together on the green economy. There are potentially 300 construction jobs on the Siemens site building the manufacturing factory. There will be 700 permanent jobs at Siemens and up to 10,000 in the supply chain working alongside different companies around the Hull and Humber area.

Let me put that into context. My constituency has 43.6 people chasing every job vacancy, so jobs are the key issue for my city and people who live in north Hull. At the moment, more than one in 10 young people in the city are not in education, employment or training, so it is important to do something fairly dramatic to ensure the regeneration of what was once a great city. Hull has the potential, with the opportunities offered by renewables, to become a world centre of excellence. We need to recognise the investment that is going not only into the green economy and the manufacturing side of turbines but into the wider economic benefits for areas such as mine. That is so important during a double-dip recession, and the green economy is growing at a rate of about 4%. I am sure that all parties would recognise that we need to do everything we can to support job creation and this particular industry.

I want to give the Government their due regarding the regional growth fund, through which £25 million was made available to work on the supply chain infrastructure that needs to be put in place to support the work that Siemens will, we hope, bring to the city. We also have enterprise zones on both banks of the Humber. I am waiting to see exactly how they are going to work, but the Government have given us the largest area of enterprise zone in the country. So, we hope that we are set, with a fair wind, to move forward, with Siemens coming to the city and with that renewables hub being developed.

Let me make two points about the Government’s approach. First, I am very concerned that any decisions the Government make on energy policy should be evidence-based. The hon. Member for South Thanet made this point in her opening remarks. We need clarity and transparency in policy and I am for ever asking the Government, in relation to all sorts of areas, where the evidence is that what they propose will work. It would be very helpful if the Minister, in his response, set out a commitment to provide reassurances about energy policy being evidence-based. The industry is looking for that and is keen to know why certain decisions are made. We also need to consider that, with investment now, the costs will come down in future. We know that the costs of the offshore wind industry will come down over time—the supply chain will ensure that—and that subsidy will reduce over time.

My second point is about the Government’s announcements, which need to be very clear and quick. The drip-drip of different possible announcements is very unhelpful. I also think that procrastination is a problem. Things need to be got on with. These mixed messages are a problem and I have to say that the Treasury seems to be causing the biggest problem. The Chancellor seems to have indicated in the past that he will not allow economic growth to be held back by green considerations, but clearly most of us in the Chamber today would say that green issues could drive the economy.

Finally, I understand that the consultation on the banding for renewables obligation certificates has taken us up to only 2017. Even with a fair wind and a relatively quick start, the green port in Hull will not begin until 2015, which will only give the industry two years of certainty about its returns. We have to look much more to the long term when we are asking industry to make huge investments.

I hope there is cross-party support for the motion. Labour introduced the Climate Change Act. We are committed to a green economy, and I very much hope that the Conservatives will fulfil their promise to be the greenest Government ever.

14:55

[Peter Aldous (Waveney) (Con)]

I congratulate my hon. Friend the Member for South Thanet (Laura Sandys) on securing the debate. Realising the full potential of the green economy is vital to securing economic recovery and creating new jobs.

The green economy is performing particularly well at present and it is important that the UK takes full advantage. Last year, the low carbon goods and services market grew by 4%, and investment in renewable energy around the world reached record levels. In 2011, there was an estimated £6.9 billion of investment in the UK renewables sector, with 21,000 jobs announced. Research and development work is ongoing, and renewable technology is becoming more competitive. The offshore wind cost reduction taskforce estimates that it should be possible to cut the cost of offshore wind by a third by the end of the decade.

It is important to take advantage of those opportunities so that as a country we are less vulnerable to rising global energy prices. We need to future-proof our economy against the vagaries of fluctuating fossil fuel prices. Such fluctuations restrict household expenditure and business investment decisions as well as pushing up inflation.

It is appropriate to commend the Government for the work they have done in the past two years. In many respects they have laid the foundations upon which a successful green economy can be built. They are tackling difficult challenges that do not have straightforward solutions. A good start has been made.

The fourth carbon budget, for the period 2023-27, has been set and the green deal starts this autumn. The Government have brought forward the green investment bank and have invested £3 billion as its initial capitalisation. It is good news that the Enterprise and Regulatory Reform Bill will enshrine in legislation the green investment bank’s objectives, embed its operational independence and provide Government with specific powers to finance it.

It is welcome that the Government are tackling electricity market reform as part of the draft Energy Bill, which is at present before the Environment and Climate Change Committee. I shall not comment on EMR in detail as we shall return to it in the autumn, but it is an extremely important subject where it is vital that the right decisions are made. In tackling EMR five guiding principles should be pursued: timeliness, simplicity, certainty, transparency and coherence.

I commend the Government for the work they have done locally in East Anglia. There is an enterprise zone aimed at the renewable energy sector in Lowestoft, in my constituency, and in Great Yarmouth, and a centre for offshore renewable engineering designation for those two ports.

To realise the full potential of green growth, the Government need to address four challenges. First, there is a need for coherence from Government. Green investment is highly mobile and globally foot-loose. Investment will flow to the most attractive destinations. It is therefore important that the Government continue to send the right message: the UK is the best place to invest, with a stable fiscal regime and a sound pricing mechanism. That is how we shall achieve the necessary investment in new energy technologies.

It is also important to provide international investors with the confidence to invest in the UK. Investors need to have faith that all departments of Government are serious about the green economy. There should be a coherent and consistent framework and the right rhetoric must emanate from the Treasury.

Secondly, there is a need to provide 21st-century infrastructure. That means smart metering, a smart grid and in due course a European supergrid. Important work has already begun on rolling out superfast broadband, and it is important that that does not stall. There is also a need to continue with the work to achieve a 21st-century renaissance on our railways, and the Economic Secretary to the Treasury is playing an important role in that in East Anglia.

My third point relates to the green investment bank and its right to borrow. I have already commended the work that the Government are doing in setting up the GIB, which will operate from 2013-14, a year earlier than anticipated. It is envisaged that the bank will have the right to borrow from 2015-16. However, I must emphasise the vital importance of the GIB having powers to borrow, so that it can reach its full potential and provide certainty to investors. It must have that power so that it is not just a Government-run fund. The £3 billion of start-up funding should unlock £15 billion-worth of private sector investment, but that is a drop in the ocean compared with the £200 billion of investment needed to invest in energy infrastructure up to 2020.

It is important not to pursue the option of borrowing through the national loans fund to fulfil the GIB’s borrowing requirements. If that is done, there will be no independence at all. The GIB needs to be able to borrow independently from the capital markets. It is important to learn from the examples in Germany, where KfW leverages its equity by a multiplier of 28, and the Netherlands, where Bank Nederlandse Gemeenten achieves a multiplier of 59. My fourth point is that we need to provide people with the skills and training needed to take up the many exciting and diverse job opportunities in the green economy.

In many respects, that meeting of minds and hearts in the rose garden of No. 10 in May 2010 seems a distant memory, and perhaps another country. However, it is important to remember that one of the objectives in the coalition’s programme for government was the Prime Minister and Deputy Prime Minister’s shared vision of building a new economy from the rubble of the old, supporting sustainable growth and enterprise, balanced across all regions and industries, and promoting the green industries that are so important for our future.

I would like to promote “Leading the Way: Green Economy Pathfinder manifesto 2012-2015”, a document about which I suspect the Economic Secretary to the Treasury knows a great deal. It is a report produced by the New Anglia local enterprise partnership, covering Suffolk and Norfolk, setting out its route map for a transition to a green economy. It was launched earlier this month, and it will be presented to the Government in the next few weeks. I urge the Government to give full regard and consideration to its five objectives and 25 goals, which I will not go through because of the shortage of time.

In conclusion, the Government have made a good start, but a lot of work is still required to realise the full potential of the green economy, and there are many challenges that remain to be met. There is a need for more co-ordination across government, closer working with both business and local government, and a clear and simple regulatory framework to promote green investment. The UK remains an attractive place to invest, but we must do all we can to ensure that that reputation is not lost, but enhanced. I support the motion, and look forward to hearing the Minister’s response.

15:03

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

I congratulate the hon. Member for South Thanet (Laura Sandys) on securing this timely and important debate, and the Backbench Business Committee on granting it.

The OECD has estimated that this year in the UK total economic demand will be only a tenth of that in Japan or the United States. The fiscal stance adopted by the Chancellor towards the economy as a whole, and particularly towards the green sector, is disappointing, given that our green economy accounts for 7% of gross domestic product and is the sixth largest in the world. It sustains 900,000 jobs and is growing at a rate of 4.7% a year, whereas, as the Office for National Statistics established this morning, the economy as a whole has shrunk by 0.2% since the comprehensive spending review in autumn 2010, although the Office for Budget Responsibility had predicted that in the six quarters following June 2010’s emergency Budget, the economy would grow at 3.7%. It seems that the green economy is one of few areas in which there is any growth at all.

China and South Korea are investing hugely in the low-carbon sector, which, it is estimated, will be worth $2.2 trillion by 2020. China’s share of the low-carbon economy is set to rise to 24% by that year. The Chancellor’s lack of foresight risks leaving the UK in the economic slow lane. It is extraordinary that it is not only the Governor of the Bank of England who now writes letters to the Chancellor about the state of the economy but, we have learned, the Secretary of State for Environment, Food and Rural Affairs, the Secretary of State for Energy and Climate Change and, perhaps most surprisingly, the Foreign Secretary. Perhaps there is only 24 hours to save the green economy, based on their concern that Government policy is simply not going far enough to generate growth in an innovative sector that, after the financial crash of 2008, provides an opportunity to rebalance a growth model that many people believe has failed.

This morning, Paul Krugman and Richard Leyard set out in the Financial Times how we have become mired in the slowest climb out of a slump since the 1870s, largely because of a lack of productive economic output. We face endemic long-term unemployment and mass underemployment, with 2 million people forced into part-time or temporary work because not enough full-time jobs are being generated in the economy. Investment in the green sector is the key to ending that trend. Krugman and Leyard conclude in their powerful piece:

“Companies will only invest when they can foresee enough customers with enough income to spend. Austerity discourages investment.”

[Kelvin Hopkins]

I support everything that my hon. Friend is saying, but is he aware that in a survey recently reported by the CBI, 94% of employers wanted, above all, markets so that they could sell their goods? They were not concerned about regulation and all the other things that the Tories talk about.

[Mr Bain]

For many months, my hon. Friend has identified the real problem—a jobs and demand crisis, which is what fiscal policy and investment in the green sector must address.

Lack of confidence means that private sector surpluses amounted to £99 billion last year, and £700 billion of private-sector assets are not in productive use in the economy. In the first three months of this year, global green investment fell to the lowest level for three years, according to Bloomberg New Energy Finance. It is clear that Governments have to act quickly if they are not to find themselves in a classic example of what Keynes called the paradox of thrift, in which the pressure to save overwhelms the need to invest and grow.

Although they are somewhat more reticent in their self-promotion, it is worth remembering that this is the Government who asserted that they were “the greenest Government ever”. Regrettably, this year’s Budget did little to redress the lack of green investment. The principal failure was the failure to improve the capital and borrowing powers of the green investment bank. As a concept, the bank is quite unique. It draws support from the CBI and the New Economics Foundation. Before the Budget, James Meadway, senior economist at the New Economics Foundation, called on the Chancellor to bolster proposals for the green investment bank with higher capitalisation and earlier borrowing powers.

Ernst and Young estimates that £4 billion to £6 billion of public capital is necessary over the course of this Parliament for the bank to be effective in tackling the investment barriers in offshore wind, carbon capture and storage, and associated infrastructure. Lord Stern, a leading climate change economist, notes that that is not state aid or subsidy, as the institution is needed because of market failures in finance, particularly those associated with risk and policy risk. However, the green investment bank will not have borrowing powers until April 2017, which casts huge doubt on its ability to raise the £200 billion estimated to be necessary to meet the UK’s CO₂ reduction targets by 2020. While immediate borrowing powers are essential, so is timing. As the Environmental Audit Committee reported in March last year, investors may put off investment while there is uncertainty about how the bank will operate. A bank that is slow in building its balance sheet may not meet our emissions and renewable energy targets by 2020.

The London School of Economics recently issued a report showing the link between the effects of the current crisis of demand and the flailing prospects of the green economy in the UK. In its recent report on green investment and innovation, the LSE argues:

“Investment has slumped mainly because households, businesses, and banks are nervous about future demand and have responded by forgoing more risky investment in physical capital.”

That is the crisis that must be addressed now. The LSE also points out that the Government

“can still steer spending and investment through a mix of policies including pricing, regulation and institutional reform”

that need not cost more money now.

Consensus on this issue comes from a surprising source—the Foreign Secretary, who said in his letter of 19 March to the Chancellor that

“we could get more mileage from this without additional commitment of expenditure or fiscal risk.”

Uncertain economic times need not mean an uncertain approach to the transition to a green economy.

Sir David King, as the hon. Member for Brighton, Pavilion (Caroline Lucas) discussed in her speech, has argued that the quantitative easing programme could also be aimed at the green economy. In an article published in The Guardian this Tuesday, he wrote:

“This laissez-faire attitude that is gospel at the Treasury is not the right one at the moment. We do not have time to play about with this—we need to move quickly to get out of the financial crisis and the resource crisis”,

and he suggests that preference could be given to projects that promote environmentally responsible and sustainable development, modernising infrastructure and marking a shift away from the present high-carbon, resource-intensive economy.

In opposition, the Chancellor highlighted the need to

“bring to an end the stale argument that we have to choose between economic growth and the environment.”

In government he has so far, sadly, forsaken both, but this is the season for Treasury U-turns. The motion and this debate give him the opportunity to get serious and to generate real green growth and green jobs, so let us have the largest U-turn yet—a fully capitalised and properly borrowing green investment bank and proper levels of investment in the green economy.

15:12

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

I congratulate my hon. Friend the Member for South Thanet (Laura Sandys) who crafted such a genius motion, covering so many strands and industries and laying open the field for us to speak on a number of topics. I have been beaten by my hon. Friend the Member for Waveney (Peter Aldous), however, who has already given a full and comprehensive speech on the merits of Suffolk, supported by my hon. Friend the Member for Central Suffolk and North Ipswich (Dr Poulter).

I said in my maiden speech that I hoped our coast, the Suffolk coastal area combined with the coast around Lowestoft in the constituency of my hon. Friend the Member for Waveney and round into Yarmouth, would be known as the green coast, and I am delighted to say that our county councils, working with the local enterprise partnership, as has already been mentioned, are doing their bit to try and make sure that that vision becomes a reality. That was further enhanced when an enterprise zone was granted in a neighbour’s constituency and has been designated one of the centres for offshore renewable engineering.

I am delighted to say that the Suffolk-Norfolk rivalries are not quite as strong as they once were: we now reach across the border and our county councils, our LEP and, I understand, Essex county council work together to make sure that we have an energy skills strategy that reaches right across our area. That was evidenced by the decision to allow Norfolk university technical college to be based in Norwich, the city represented by my hon. Friend the Economic Secretary. That is a great opportunity and I am delighted to say that Suffolk and Norfolk are getting a grip on it.

With regard to the fiscal and regulatory framework, I was not surprised by the speech made by my right hon. Friend the Member for Hitchin and Harpenden (Mr Lilley), because I know that he holds strong views on these matters. I understand perfectly why he feels that energy costs are unnecessarily high: he blames the subsidy and thinks it is a problem for other industries. I take a very different view: that if we are to encourage self-reliance in energy, we have to invest in our energy infrastructure. It is not about subsidy; it is about an incentive to attract investors from around the world, and nowhere more so than at Sizewell C. I have seen the strong commitment of EDF and British Gas to continuing their planning application work not only at Hinkley Point, but at Sizewell C. Frankly, all the talk about subsidy is nonsense. It is an incentive to have green energy infrastructure on which we can all rely.

I hope that we in Suffolk Coastal will be vying with my hon. Friend and neighbour across the river with the coming online of the Greater Gabbard, Galloper, and East Anglia wind farms and so on, as many of those come onshore in my constituency. That does not mean pylons in my constituency, although sadly it does in one nearby. We are seeing for ourselves the future of green energy, and we are proud to be part of it.

I say to the Minister—she has heard me talk about this before—that it would be lovely if the contribution those communities are making to green growth was reflected in the allocations from the coastal communities fund. They deserve the lion’s share of that money. Frankly, I feel that we should get our share of the revenue that the Crown Estate secures from offshore wind farms and other such activities. [Interruption.] I am delighted that my hon. Friend the Member for South Thanet seemed to say, “Hear, hear” to that.

On other routes to market, I think it is telling that one aspect of green growth is trying to reduce the amount of energy we need for anything. I am delighted that the Government have put in place the money for rural broadband roll-out. I hope that the director general for competition in the European Commission does not put a spanner in the works by trying to prevent that money—our money—being used to ensure that we get broadband throughout the country. The other investment that my right hon. Friends in the Government are making, of course, is the investment in rail. I am sure that the Minister will not mind if I plug the future launch, which we hope will be very soon, of our prospectus for increased investment in rail, because we believe that it will generate a huge economic return for our region and the country.

I will mention briefly the contribution from my hon. Friend the Member for Selby and Ainsty (Nigel Adams). I have a lot of sympathy with his dedication to biomass. We have an anaerobic digestion plant at Adnams near Southwold and more are planned, but there is concern in East Anglia that biomass plants will be powered by straw that is sourced locally, because that would increase the price of straw for farmers elsewhere. With increasing welfare standards, which we all welcome, agricultural production will require more straw, which will start to become a scarce commodity. I have raised the issue with hon. Friends elsewhere—indeed, I am meeting the Minister to discuss the point—because we need to bear in mind the risk of distorting practices elsewhere through incentives on one side.

Finally, I will turn to the planning debate. There is no question but that I prefer offshore turbines to onshore ones, even though they are more expensive—the cost is coming down, as has been mentioned—especially as half my constituency is in an area of outstanding natural beauty. A very unpopular planning application was granted only the other day in Levington, which is in an AONB, and I was rather shocked and surprised that the four councillors outvoted three and the one who abstained. It was a great shame, because one of the things we need to do is get our communities behind the energy revolution and to share in it. Elsewhere in the constituency, communities have come together in wanting a turbine, so that they can use the proceeds from it. We need to develop an element of consensus on wind farms, because once they are in place, as my hon. Friend the Member for Waveney will know with the Kessingland turbines, there are still issues for residents that need to be solved.

I shall use part of my contribution to this debate to call on my local district councils and indeed councils throughout the country to take advantage of the recent Department for Communities and Local Government guidance on including a supplementary planning document specifically on renewable energy. Instead of councillors being beset by every single application and the Planning Inspectorate overturning decisions, I would like to see local councils develop their activities in a planned and structured way and be part of the process of making sure that the future is as green as the luscious fields that we have enjoyed since all this rain fell.

The future is green. One of our party’s slogans was “Vote Blue, Go Green” and I would like to think that under this coalition Government, we are doing more than ever to promote the green economy.

15:20

[Martin Vickers (Cleethorpes) (Con)]

I, too, congratulate my hon. Friend the Member for South Thanet (Laura Sandys) on securing this debate.

Energy policy and, in particular, the fiscal and regulatory framework that governs it is critical to my constituency. The hon. Member for Kingston upon Hull North (Diana Johnson) outlined the advantages of the Humber estuary in terms of location and the development of the renewable sector, and its geographical situation is absolutely ideal for servicing offshore developments.

Developing renewable energy is more than an environmental solution to help slow climate change, however; it is about bringing jobs and investment and revitalising, rejuvenating and regenerating my constituency and other areas that have been hard hit by unemployment and by business closures.

Existing jobs in my constituency are heavily dependent on energy-intensive industry, including petrochemicals refining and steel production, but there is a limit to their ability to subsidise the development of the renewables sector, and the Government must be mindful of that. Part of the political process does, of course, involve balancing competing arguments.

To return to future jobs, however, the Government have recognised the area’s potential by establishing an enterprise zone, the very name of which—the Humber renewable energy super cluster enterprise zone—does not roll off the tongue but is an acknowledgment of the Government’s support for the growth of the sector in the area.

The zone includes the south Humber energy park, being developed by Able UK, which will not only, we hope, attract a major international company, but provide a massive opportunity for smaller and medium-sized businesses to become involved in the supply chain.

The establishment of the energy park project is going as well as can be expected, but the long drawn-out process has highlighted the need for greater clarity and speed on the part of the various Government agencies involved. I welcome the recent announcements indicating the Government’s determination to tackle those issues, and I urge them to ensure that the announcements are followed through and delivered speedily. If investors are to make sound judgments that favour the UK, we need to avoid delay and to speed up the development of infrastructure and jobs in areas such as my constituency, which so desperately needs them.

Potential investors have drawn my attention to several other factors, including the need for greater clarity on how the Treasury will value and ration contracts for difference—CFDs—for levy-control purposes, given that the amounts paid out under them will vary according to the wholesale price for power.

On CFDs, there are questions also about budgeting. From 2014 to 2017, there will be a choice between renewable obligations certificates and CFDs, but the available budget will have to cover both, so I stress again that clarity is needed on how this highly uncertain situation will be managed.

The industry is asking questions because it wants to see the expansion not purely of one sector, but of many, as indeed we all do. The knock-on effects of the green economy will be felt for generations, and I for one want to support the best opportunities that we can give them—but not necessarily at the expense of the current generation of jobseekers. That is what the green economy is really about, so saving the beauty of Britain and saving jobs for the British people must be our aim. This is an economic eco-system in which what happens in one area affects all the others. One aspect of that eco-system that the Government have got right is the interaction of stakeholders with local authorities, which has produced great successes in Humberside involving the recently established local enterprise partnership.

Recently I got together with my hon. Friends the Members for Cambridge (Dr Huppert) and for East Hampshire (Damian Hinds), and Green Alliance, to produce a pamphlet highlighting the importance of local leadership in the dash for green growth. The hon. Member for Kingston upon Hull North mentioned names that were familiar to me from the north bank Humberside area. I add my support and congratulations to political and business leaders in northern Lincolnshire, who have played a significant part in this. There has been cross-party, cross-river support for the various initiatives. As in the case of the Suffolk-Norfolk situation mentioned a few minutes ago, it is relatively unusual in Humberside to get support from both banks of the river, but thankfully, colleagues from both sides have come together. The local aspect of this could unlock business and industry from over-taxing, centralised policies. We urgently need to cut red tape and speed up the process.

Localism is powerful, and these opportunities are being ambitiously pursued with a focus on green business and investment. Investors are perceiving more risk than opportunity, and we need to ask why that is so. Perhaps there are too many complexities in the current set-up. Complexity equals risk, risk equals costs, and costs equal a lack of investment. We need to reduce the administrative quagmires and uncertainties and introduce a more locally based initiative that could speed up the process. The potential for job growth from the green economy is considerable, and I hope that we can move forward much more quickly to achieve that. I urge the Government to do more to end the uncertainty that the industry faces.

The other day, I attended an informative reception on biofuels—a huge growth area that has one plant coming online, but only one. We need to expand that sector as quickly as possible.

Ministers have worked hard to simplify the process by which the industry can develop. Despite the recent withdrawal of Vestas from its Sheerness project, there remains great potential to grow the industry, to the enormous benefit of my constituency and the country as a whole. I readily support the motion.

15:27

[Andrew George (St Ives) (LD)]

I am pleased to have an opportunity to speak in this important debate. I warmly congratulate the hon. Member for South Thanet (Laura Sandys) on driving the initiative for the debate and on making a telling and significant opening speech in which she set it on the right course.

So far, speakers have not much reflected on why it is necessary for us to pursue a low-carbon future—apart, that is, from the right hon. Member for Hitchin and Harpenden (Mr Lilley), who is no longer in his place—and have accepted that policy as a given. As a responsible and significant country that wishes to lead the way internationally—for example, at the recent Rio+20 summit —we should be setting the standards in responding to the challenges facing the globe. The recent Stern report set out the significant impact that rapid climate change will have on people and their lifestyles around the globe, and on the world’s economy, including this country’s economy, if we fail properly to get on top of the problem.

I am glad that that is now seen as the relatively unarguable fact of the matter. Although there are some who advance the case—I will not say that it is a respectable case, but I respect the fact that they argue it—of the climate change deniers, who are the modern equivalent of the flat earth society, on a relatively un-peer reviewed and un-scientific basis, it is good that this Government, the previous Government and Members of this House generally take a reasonable approach to the challenges that we face.

The global market in low-carbon goods and services is currently worth £3.2 trillion and may be worth as much as £4 trillion by 2015. It employs 28 million people worldwide and, unlike many sectors, is growing at a rate of 4%, which is faster than the world’s GDP. The nub of the debate is that we can either ignore that growing global market in low-carbon goods and services and say that Britain wants no part of it, or say that we want not only to be part of it, but to be at the cutting edge. Britain should provide the necessary economic certainty for the players in that market to develop low-carbon technology in this country. We must give the right signals and encouragement to those industries. The underbelly of such certainty in Britain can provide the basis on which companies can test and develop those industries, and then become world leaders and develop an export market for the UK.

Fundamentally, that is what I believe lies behind what the Government are doing, and theirs is the right approach. They are putting the investment in and trying to read the messages in the market itself. I know that the Government have had some difficulty with solar photovoltaics, but the fact is that the cost of solar PV reduced by more than 50% in one year. It is difficult for any Government to have a system that can respond effectively to that and not create distortions in the market. We need to have the right incentives to encourage these industries, but the incentives must work in a manner that creates certainty for the long term. Despite the difficulty that was experienced last year, I am pleased that there is now a great deal more certainty and a formula in the feed-in tariffs system that will take the solar PV industry forward to a point where ultimately, in only a few years time, it will not need any fiscal stimulus to continue succeeding and to be one of the most significant players in our economy.

[Mr Robin Walker]

Worcester Bosch, a manufacturer of solar thermal energy, is based in my constituency. One of its concerns is that the enormous subsidies for solar PV under the unreformed feed-in tariffs system discouraged people from investing in solar thermal. Does my hon. Friend agree that having a more sensible and sustainable system will encourage the development of all technologies?

[Andrew George]

My hon. Friend makes the point very well. We must get the balance of the fiscal incentives right. The hon. Member for Southampton, Test (Dr Whitehead) made the point to the right hon. Member for Hitchin and Harpenden that the European rules do not rule out establishing incentives to develop and then roll out new technologies to promote the low-carbon economy.

West Cornwall and the Isles of Scilly in my constituency have for many years been at the cutting edge of many renewable technologies. We had the first wind farms at Delabole and Cold Northcott in the late ’80s. The geothermal project at Rosemanowes, near Penryn, has spawned a number of developments involving ground source heat pumps and deep geothermal, which I believe will be a significant driver of low-carbon technologies into the future. I am also pleased that the Government are investing in geothermal energy. More of Cornwall’s landscape is taken over with large solar PV than other parts of the country—Cornwall is famed for its sun, and it rarely rains. We want to harness that technology.

The first place in the UK to roll out commercial-scale wave technology is also in my area. That required significant Government investment—from the previous Government and the current one. We are at the critical point of ensuring that we plug companies into the system and that it works.

With all those sectors, Cornwall wishes to be seen as the green peninsula—the cutting edge or blueprint from which others can learn. The Eden project is an exemplar of rolling out such projects. It is not just the technologies that hope for opportunities, but companies. For example, Fugro Seacore, an offshore drilling company—I must declare an interest: my son works there—is helping to put in the footings for offshore wind. Such companies hope to have improved opportunities as a result of the fiscal measures that the Government are putting in place to promote low-carbon technology. I hope all hon. Members support this important motion.

15:36

[Cathy Jamieson (Kilmarnock and Loudoun) (Lab/Co-op)]

I thank the Backbench Business Committee for bringing this important matter to the House, and the hon. Member for South Thanet (Laura Sandys) for her opening speech. Other hon. Members have mentioned the drive she showed to ensure that we had the opportunity to discuss this matter.

We heard 14 subsequent speeches, covering a range of subjects—I shall mention some of them in my remarks. I welcome the Economic Secretary, who is here to listen. A succession of Ministers has been present during the debate, which is important in the context of joined-up government. I hope she finds the debate slightly less of a hot seat than she was subjected to previously. It is good that hon. Members have tried to shed more light than heat.

I am proud that one of the Labour Government’s legacies was the broad acceptance of the need to tackle climate change. They worked tirelessly to attract low-carbon investment and to strengthen the UK’s green economy. The Climate Change Act 2008 was a world first—it binds the UK Government by law to reduce carbon emissions by a third by 2020 and by 80% by 2015. My hon. Friends the Members for Southampton, Test (Dr Whitehead), my hon. Friend the Member for Kingston upon Hull North (Diana Johnson) and others were part of that process. We owe them a debt of gratitude for their work at that time, because it helped us to reduce the UK’s greenhouse gas emissions by more than 20%—to below 1990 levels—and to beat our Kyoto target.

The Labour Government doubled renewable energy generation. We tried to establish Britain as a world leader in offshore wind capacity, and moved towards the UK becoming a world leader in the prototype development of wave and tidal technology, as hon. Members have said. Clean coal and coal-fired power stations can sometimes be controversial, but the previous Government proposed that no new coal-fired power stations would be built without carbon capture and storage to cut emissions drastically.

When I spoke of the debate being generally consensual, I should have mentioned the slightly discordant note struck by the right hon. Member for Hitchin and Harpenden (Mr Lilley). I use the word “discordant” not to be critical. In characteristic style, he made his point and put the other side of the argument. It is important that such views are heard. When Labour left office, investment in alternative energy and clean technology had reached £7 billion, and we were generally thought to be moving things in the right direction compared to other economies in the world. Even amid the worst global economic slow-down since the 1930s, the low-carbon economy in the UK still grew by 4.5% in 2008-09 and by 4.3% in 2009-10.

Several contributions this afternoon have referred to the Chancellor and the Prime Minister’s position when in opposition. Indeed, prior to the 2010 election, both promised to continue the work under way and to prioritise the transition to a low-carbon economy. We have heard several quotes this afternoon, but let me recap the Chancellor’s position in 2009, when he said:

“We need to recognise the fierce urgency of now. We need to see the whole of the government pulling in the same direction to cut emissions and green our economy… Climate change cannot solely be the concern of the climate change Minister.”

That is an important message—and might be one of the few occasions I have agreed with the Chancellor. He also said:

“I want a Conservative Treasury to be in the lead of developing the low-carbon economy and financing a green recovery”.

He then gave the following commitment:

“If I become Chancellor, the Treasury will become a green ally, not a foe.”

Some of today’s questions have focused on how the Government plan to deliver on their promise to be the greenest Government ever and to build on the work already done.

[Neil Carmichael (Stroud) (Con)]

I have just come from the Enterprise and Regulatory Reform Public Bill Committee, where we discussed the green investment bank, which is an important part of the Government’s strategy. Does she agree that it will be a powerful driver for improving our environment as part of the green economy?

[Cathy Jamieson]

I thank the hon. Gentleman for that information, and I am glad that the Committee is discussing the green investment bank. It has generally been welcomed this afternoon, although there is concern about whether it can deliver on its objectives and whether the Government are taking the right action to secure investment. Hon. Members have mentioned borrowing powers and other things that I will develop later, if I have time. However, although the green investment bank is important, it must have the right powers to succeed.

I have another concern that was reflected in contributions this afternoon. Are we really on the path to making this the greenest Government ever, or is the coalition, as has been suggested,

“on a path to becoming the most environmentally destructive government to hold power in this country since the modern environmental movement was born”?

Those are not my words—I mention them because it is important to consider different sides of the argument—but the words of leading environmentalists, including Greenpeace and the Royal Society for the Protection of Birds writing at the end of last year.

It is almost as if the Government, despite their earlier promises, no longer consider the transition to a low-carbon economy as their top priority. In the autumn statement, the Chancellor said that if we burden British businesses

“with endless social and environmental goals, however worthy in their own right, not only will we not achieve those goals, but the businesses will fail, jobs will be lost, and our country will be poorer.”—[Official Report, 29 November 2011; Vol. 536, c. 807.]

As hon. Members have argued powerfully, that is a particularly short-sighted way of looking at the world and completely ignores the opportunities to create an active industrial strategy within which the green economy can grow.

As other Members have argued, we have choice: we can either embrace and lead a new energy industrial revolution, or we can be left behind. We know that we are in difficult economic times, but all the measures we want to take on growing the economy will also help green growth, which is why Labour’s five-point plan sets out the immediate actions that we believe the Government should take to boost growth and create jobs, which would also help to strengthen the green economy. Even businesses have rejected the argument that the transition to a low-carbon economy is a burden; they believe it provides the UK with a huge opportunity for growth. The deputy director general of the CBI was very clear:

“Environmental regulation doesn’t have to be a burden for business. Framed correctly, environmental goals can help our economic goals—help start new companies and generate new jobs and enrich us all.”

We have heard the Foreign Secretary’s views quoted a number of times this afternoon. I suspect that he would be surprised to feature so often in a debate on the green economy. I shall not repeat quotes already referred to, other than to say that there are some powerful messages in them, as there are in the report published last month by the Environmental Audit Committee, which warned that green investment should play a key role in the UK’s economic recovery. We have also heard figures suggesting that the global market for environmental goods and services stands at around £3.2 trillion today, but will potentially be worth as much as £4 trillion by 2015. The figures on investment in clean energy have also been mentioned.

The green economy is growing worldwide, but the real danger is that if this Government do not continue the work started under the previous Government and do not see that climate change is important or that the green economy is a part of growing the wider economy, we risk being left behind.

Let me return briefly to the green investment bank. The Chancellor was very quick in the autumn statement to take credit for it as the Chancellor who funded the first ever green investment bank. It could, of course, leverage private investment and help drive economic growth, but the danger is that it risks falling into limbo. The Government now seem set to borrow £150 billion more than they planned to do a year ago, which poses issues, and the date by which we will have a proper functioning green investment bank with full borrowing powers has slipped back to 2016 at the earliest. Perhaps the Minister will provide some reassurance on that. The Government’s claim that the green investment bank is part of a strategy for growth and is to be centre stage will look pretty thin if it is not able to deliver any real investment in a meaningful time scale.

I have a couple of further points before I allow the Minister to sum up. The green deal has been referred to by several hon. Members this afternoon. That is important, but concerns have been raised about the fact that, despite the original claim that up to 100,000 jobs would be created in the insulation sector by 2015 and that 14 million homes would be reached by 2020 and 26 million by 2030, the consultation on the green deal, which was published in November 2011, came with some downgraded job forecasts, less funding for fuel-poor households, as we have heard, and no detail about the interest rates on which the green deal will rely.

Some Government Members have raised concerns—quite gently, I think—about what I and others described at the time as “shambolic” attacks on the feed-in tariffs for solar power. That risked thousands of jobs and left the public with legal bills running into tens of thousands of pounds.

Let me add my concern to those already raised about the plan by Vestas for the manufacture of wind turbines. It was originally hoped that it would create some 2,000 jobs, but it has been abandoned. The hon. Member for South Thanet, a member of the Energy and Climate Change Committee, was quoted as saying at the time that Vestas’ decision would have been

“a commercial one but it also suggests a lack of confidence within the industry over the government’s commitment to the green economy and crucially to offshore wind.”

As I understand it, she went on to say, as other Members have said this afternoon, that the market needs certainty from the Government. That has been a running theme throughout our debate: in order to develop, create and ensure that new technology is made accessible and affordable as part of the delivery from tackling climate change and growing the economy, the market needs certainty and long-term planning. I strongly argue that it is necessary for the Government—across all Departments, including the Treasury—to stand up and take those responsibilities seriously.

Let me end my speech by telling the House what Labour believes we need to do. Some of it has already been set out by the shadow Secretary of State for Energy and Climate Change, my right hon. Friend the Member for Don Valley (Caroline Flint). She identified five key elements in an active industrial strategy. First, we need to unlock private investment by delivering on electricity market reform and ensuring that the Government act decisively. Secondly, we need to improve public procurement to support the green economy. We have heard about housing-related issues, and I think that we could do more in that regard.

Thirdly, we need a strategy for skills for a low-carbon economy. Over the past weeks, I have been meeting representatives of the automotive industry and the biofuels and combined heat and power sectors. All of them have said that there are possibilities for job creation, but that it will require investment, research and development and the right skills set, and that young people should be encouraged to take up those job opportunities.

Fourthly, we need to rebalance the economy, support growth in the regions and encourage manufacturing, and, as I have said, supporting green technologies will be a vital part of that. Further growth will require policy certainty and stability for investors, producers and users. Although talks are in progress in some of those sectors, I find it worrying—as, I am sure, do other Members—that the Government’s long-term commitment to combined heat and power and biodiesel, for instance, has not yet been made explicit. The industry must be persuaded that investment in those processes is worth its time, effort and money.

The final element in an active industrial strategy is something that we did not have the opportunity to discuss in great detail this afternoon, although a number of Members referred to it. We need to engage with the public and communities. Such engagement cannot be seen as a mere add-on, or something that we should do after everything else has been done. That goes for economic growth, but it also goes for our own behaviour. Household energy consumption is responsible for nearly a third of total carbon emissions. Of course we could do more in that respect, but we must also ensure that our communities are actively involved. Members have given some good examples today of how that can be done—for instance, through co-operative energy ventures or through communities’ buying, establishing and benefiting from their own turbines.

Today’s debate has given us an opportunity to explore ideas, to raise the concerns of industry—which have been mentioned throughout the debate—and to consider creatively how we can bring about the right economic conditions for sustainable growth and how the green economy itself can contribute to jobs and the wider economy. What we now want to hear from the Minister are practical ideas for fulfilling the commitments that the industry wants from the Government.

15:52

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

This has been an extremely interesting debate on the important issue of how to achieve a green economy in the United Kingdom. I am delighted to be back at the Dispatch Box discussing a subject of great importance in a civilised and reasonable way. Indeed, I shall be happy to take interventions, having already had such extensive experience of that practice during the week.

Let me echo the tributes that have been paid to my hon. Friend the Member for South Thanet (Laura Sandys). She did a fantastic job in setting out the terms of the debate. She spoke of jobs and opportunities, she spoke of transparency and evidence, she spoke of the long term, and she spoke of a role for the UK in being proudly and successfully resilient, innovative and productive. I think we can all identify with the sentiment and the passion with which she dealt with those issues.

Many Members mentioned the Environmental Audit Committee’s report on the green economy, which was published in May. I had the pleasure of giving evidence to the Committee during its inquiry. I commend its Chair, the hon. Member for Stoke-on-Trent North (Joan Walley), for her work and for the speech she made this afternoon. Like my ministerial colleagues, some of whom were able to join us today, I read the report with interest. The Government are preparing a response, and will release it shortly.

As I said a moment ago, some of my ministerial colleagues were able to join us for a debate that, ultimately, dealt with much wider issues than the fiscal aspects of the green economy. It should be noted that, in many areas, the UK is leading the way globally. The Under-Secretary of State for Environment, Food and Rural Affairs, my hon. Friend the Member for Newbury (Richard Benyon)—who was present in the Chamber until recently—is off to Panama this weekend to represent the UK. The work that he and others have been doing demonstrates that the UK takes the protection of our natural environment and the development of the green economy very seriously indeed.

I pay tribute to Members for their contributions to this debate, including the hon. Members for Southampton, Test (Dr Whitehead), for Brighton, Pavilion (Caroline Lucas), for Luton North (Kelvin Hopkins) and for Kingston upon Hull North (Diana Johnson), and my hon. Friends the Members for Sittingbourne and Sheppey (Gordon Henderson), for Romsey and Southampton North (Caroline Nokes), for Selby and Ainsty (Nigel Adams), for Cleethorpes (Martin Vickers), for St Ives (Andrew George) and for Waveney (Peter Aldous). I hope to be able to address their points, and those of other speakers, later in my remarks. Sadly, my right hon. Friend the Member for Hitchin and Harpenden (Mr Lilley) has had to leave the Chamber, but I suspect even he would agree that this Government are focused on reducing the deficit, keeping our country safe in the global storm, and doing everything possible to help people in Britain deal with the rising cost of living.

We must consider the effects our comments this afternoon will have on households and businesses. The hon. Member for Brighton, Pavilion mentioned interest rates, and I assure her that our actions more broadly throughout the economy have helped keep them low for households and businesses. My hon. Friend the Member for Romsey and Southampton North talked about simple household measures that can help, and she and I share the same principles in this regard.

The Government have made it absolutely clear that we want a growing economy. That cuts to the heart of the issues we have been debating this afternoon. I make no apology to those that have heard me—and other members of the Government—say this before, as it bears repeating: green growth and a green economy are not separate from the economy at large. On the contrary, they are closely intertwined, as my right hon. Friend the Deputy Prime Minister made clear in his statement on the outcomes of the Rio+20 summit earlier this week. Our entire economy needs to be environmentally sustainable, enabling us to maximise growth while, importantly, managing our natural assets sustainably. That is plain common sense; it is about the efficient use of assets in the interests of the nation. It is both economically and environmentally the right thing to do.

We all know that that is the case from our experiences in our constituencies—I certainly do. I must pay tribute to my hon. Friends representing Suffolk constituencies who have spoken today about the thriving low-carbon sector in their seats—and mine—in East Anglia. As well as all the other sectors mentioned this afternoon, I might refer to the beer industry—which is a presence in the constituency of my hon. Friend the Member for Suffolk Coastal (Dr Coffey)—as all of us might almost prefer to be enjoying its products on this warm afternoon than to be here in the Chamber.

The Government are using the broad range of tools at our disposal to help support the transition to a green economy. Those tools include regulation, financial incentives, voluntary commitments, public sector procurement and fiscal measures. As the motion highlights, we need to have the right regulatory and fiscal framework to achieve that, and we are putting such a framework in place.

From the outset, the coalition Government have committed to being the greenest ever and to increasing the proportion of revenue from environmental taxes. Some have said that Budget 2012 was not green enough. I disagree. We need to be realistic and acknowledge that not every Budget can be full of new green measures and proposals. After all, these are projects for the long term, as has been acknowledged in our debate. I might cite the examples of helping to protect households in the long term through taking action on energy bills, creating investment, supporting new infrastructure—I welcome the comments on that by my hon. Friend the Member for Waveney—and putting in place a stable fiscal and regulatory regime. Budget 2012 demonstrated the Government’s commitment to continuing with their plan to meet their environmental commitments while reducing unnecessary administrative burdens. Let us also be clear that, as well as incentivising behavioural change, the environment-related tax decisions in the Budget make an important contribution to reducing the record deficit left to us by the previous Government.

I shall now discuss how we can bring forward green growth and incentivise it. As I have said, our priority is to achieve strong, sustainable and balanced growth that is evenly shared across the country and between industries. May I set out a couple of areas of policy on which the Treasury and others are collectively leading that we think are in a position to help with green growth? The first of those is the carbon price floor. At Budget 2012, the Chancellor set the carbon price support rates for 2014-15 to meet the carbon price floor as it was set out at Budget 2011. This is a first-of-a-kind tax, and it will provide greater long-term certainty to the carbon price. It will give a secure future for billions of pounds of investment in low-carbon energy, which I am sure all hon. Members will welcome.

Support is also being provided to key industries—our energy-intensive industries—to ensure that they can adapt over time. Electricity market reform has recently been proposed in the draft legislation currently undergoing pre-legislative scrutiny, and that programme talks of needing more than £100 billion of investment to 2020 in electricity generation and networks.

[Dr Whitehead]

I am taking up the Minister’s invitation to intervene. Will she consider, even at this late hour, telling us about electricity market reform and how it affects the Treasury at the next meeting of the Select Committee on Energy and Climate Change, which I hope will be held next week? May I assure her that if she does take up our invitation, she will receive a warm welcome and some very straightforward and supportive questions during that discussion?

[Miss Smith]

I thank the hon. Gentleman for his good-natured reiteration of an offer to appear before the Committee. I have not appeared before it because it is scrutinising the draft legislation of another Department. I believe that my right hon. Friend the Secretary of State for Energy and Climate Change, who was also here this afternoon, explained to the Committee this week that he, of course, is representing the Government’s collective position. Although I welcome the hon. Gentleman’s faith in me, I regret that I do not feel that I could usefully add more than that which the Secretary of State has already provided to the Committee. May I also point out that electricity market reform, as my right hon. Friend will have set out, is an early and credible signal to investors that the Government are serious about encouraging investment in low-carbon electricity generation now?

I shall now deal with some of the points made in this debate. My hon. Friend the Member for Sittingbourne and Sheppey exhorted the Government to be clearer on wind energy. I say to him that the Government have been conducting a thorough review of the support provided by the renewables obligation and the Department of Energy and Climate Change will publish the results of it shortly. I know that he and others will take a deep interest in that.

Let me discuss other ways in which the Government have set out action, for example, in the area of accounting for our natural capital. The natural capital committee will help the Government to prioritise actions to support and improve the UK’s natural assets. I reassure the hon. Member for Stoke-on-Trent North that sustainability is considered when developing policy. Her Majesty’s Treasury’s Green Book already does that in guidance, clearly setting out how Departments can take into account natural capital and long-term sustainability issues.

May I further reassure the hon. Members for Southampton, Test and for Glasgow North East (Mr Bain) on the green investment bank? The important point is that the GIB pathfinder—UK Green Investments—is now open for business, with more than 20 individual projects under active consideration, including in renewable energy, waste management and energy-efficiency. All those are large markets with enormous growth potential. Calls have been made this afternoon for it to move forward more quickly and be able to borrow. I wish to reassure the House that it has been given £3 billion in its initial capitalisation and has the potential to borrow from April 2015 when debt is falling as a percentage of GDP—that is a crucial point.

Across the economy, we are focusing on creating the conditions for private sector investment and growth, including through innovation. As Members would expect, that includes supporting private sector investment and focusing on sustainability. I could point out fiscal steps that are in line with the motion, including a new above the line credit to support research and development activity in the UK and increases to the rate of enhanced deductions of SME research and development tax credit. Together with the green investment bank, those measures will play a crucial role in encouraging innovation in the green technology sector, which will have benefits for the wider economy, jobs and growth. Together with the green deal, the measures will help householders both directly and indirectly. I can reassure the hon. Member for Brighton, Pavilion that her calls for a whole-house approach in retrofitting are in line with what the green deal and the ECO aim to achieve. Those schemes also target funding at low-income households, which is very important for the battle against fuel poverty.

Regulation can play an important role in setting common standards and expectations. The Government recently announced that we will introduce mandatory reporting of greenhouse gases for all companies quoted on the London stock exchange. Again, that goes back to the theme of transparency. In this current economic climate, it is crucial to make it simpler for businesses and industry to meet their environmental responsibilities. We will continue to review and amend existing fiscal instruments and regulatory instruments to ensure they remain focused on achieving both economic and environmental objectives. An example of that is the review of the carbon reduction commitment scheme. Budget 2012 announced a consultation on proposals to reduce administrative burdens in that scheme and the Government are considering the responses to the consultation, which has just closed.

Let me return to the importance of this afternoon’s debate. It has been interesting and has demonstrated the importance of appropriate Government action across a breadth of sectors and using various tools. That action must encourage and drive forward an environmentally sustainable and growing economy. It must pay attention to skills, and I was interested to hear the calls for attention to be paid to the high level of skills we can achieve in the British economy in a fully competitive sense. Once again, I welcome the passionate speeches from hon. Friends and hon. Members. I fully agree with those who have said growth and greenness are not mutually exclusive. We can have both. This Government want an economy that is growing, balanced and sustainable, which is good for businesses and for households. The actions that this Government are taking will help us get there and I thank the Backbench Business Committee and the House for raising the issue.

16:07

[Laura Sandys]

I want to thank everybody who has participated in the debate. It has been very wide ranging, as the Minister said, and I thank her in particular for her attention as she sat through the debate and heard all the different constituency and thematic issues that were expressed. I want to question only one thing that she said, as I do not think that anybody would presume that it is a question of either green growth or industrial growth and GDP. In my view, they are one and the same. Unless we think about the domestic production of energy to hedge off the international volatility of energy production, we will find domestic growth extremely difficult. Household bills will increase and businesses will start to be challenged.

We have covered every part of the green economy in the debate, and it is a part of the economy that is growing. In my constituency, the potential investment of £1 billion is about to be decided in boardrooms not just in the UK but around Europe. They are looking for investor confidence and I hope that this debate has contributed to that. I know that the Minister’s contribution has underpinned what this country requires to build on that growth: investor confidence, clear policies and a commitment to a green economy for the future. We need to take measures to deliver for UK jobs and our wider economy.

Question put and agreed to.

Resolved,

That this House urges the Government to promote the right fiscal and regulatory framework to accelerate green growth as an intrinsic part of the UK’s economic recovery strategy.

Minister for Older People

Thursday 28th June 2012 Commons Chamber

16:09

[Penny Mordaunt (Portsmouth North) (Con)]

I beg to move,

That this House notes the concerns of the Grey Pride campaign; and calls on the Government to consider appointing a member of the Cabinet to be the Minister for Older People, to give a political voice to the older generation, to oversee the co-ordination of services which affect older people, and to focus on tackling the social and economic challenges of demographic change.

I thank the Backbench Business Committee for selecting the motion for debate. I am pleased that the new Committee agreed with the previous Committee that the issue of co-ordinating policy for older people is worthy of time on the Floor of the House.

I should also thank at the start of my speech the 140,000 people who signed Anchor’s Grey Pride petition calling for a Minister for older people to be appointed. Unusually, it was not an online petition, and signatures were gathered from care home residents across the UK. I was approached by Anchor, a not-for-profit care home provider, as the Conservative chairman of the all-party group on ageing and older people, to help Anchor to present that petition at Downing street, and I was pleased to do so because I think the value of such an appointment is readily apparent.

The term “older people” is used often, but is likely to be used without much thought, even by those of us who purport to be their advocates. On a recent fact-finding mission to my local hospital’s physiotherapy department, I met an elderly gentleman exercising his leg. “Hello,” I said, “What’s your name?” “Donald” he replied. “Do you mind me asking how old you are Donald?” I asked. “I’m 83,” he said. “What happened to you?” I asked. “I broke my hip, my thigh and my shin bones,” he replied. As I thought of him trying to navigate a slippery pavement in his slippers, I ventured, “Gosh, that must have been a terrible fall.” “It was a parachuting accident,” was the matter-of-fact response. That shut me up.

Say, “older people” and the image that comes to mind is probably one of someone in gentle dotage plucking a Werther’s Original from his cardigan pocket and proffering it to a beaming grandchild, but what about the skilled manual worker who has been made redundant in his early 50s and is in need of a drastic career change to carry on working? What about the grey entrepreneur who has a cracking business idea but faces far more hurdles to get credit than a younger man would? What about the 80-year-old who is isolated in his own home, miles away from his family; or the couple who care for each other until one is ill but who cannot access the support they need because ad hoc domiciliary care is not an option?

[Caroline Nokes (Romsey and Southampton North) (Con)]

I am pleased to hear my hon. Friend mention carers. In England and Wales, there are 1 million carers who are over 60 and 40,000 who are over 85. Does she believe that a Minister for older people would be able to act as a champion for those carers?

[Penny Mordaunt]

My hon. Friend is absolutely right to raise that issue. We recently had carers week and I know she is a great champion for all carers in her constituency.

There is huge and diverse range of older people. We now have the first generation of older people living with HIV, who worry whether they will find a care home with staff and residents who understand their needs. Evidently, older people are a diverse bunch with needs and problems that fall within the remit of many Departments—just like everyone else then—but too often policy is focused on the needs of the stereotypical old person. Too often, policy is made with the fit, the able-bodied, the internet-savvy and the average user in mind. Older people can be at the margins of those groups and are peculiarly exposed to the dangers of unintended consequences. There have been too many missed opportunities and unforeseen outcomes that have robbed the Treasury of income, the taxpayer of value for money and older people of life-enhancing opportunities.

There are many Ministers across Government with responsibilities that touch on some aspect of older people’s lives, but with only a narrow focus on one policy area. That is why someone in government must be responsible for the interests of older people. It would be no good if it were a Minister of State from the Department for Work and Pensions—I apologise to the Minister of State, Department for Work and Pensions, the hon. Member for Thornbury and Yate (Steve Webb)—or from the Department of Health, because they would be susceptible to the silo thinking we must avoid.

[Dr Sarah Wollaston (Totnes) (Con)]

Does my hon. Friend agree that this is an issue not just for central Government but for local government? Does she agree with the findings in the Select Committee on Health’s report on social care that we need a single joint commissioner for health, social care and housing as we move forward into health reform?

[Penny Mordaunt]

My hon. Friend is absolutely right and I hope to give some practical examples of where I think that will have an effect.

The ministerial position should not be a new one; it should be an additional responsibility, and given to a member of the Cabinet. Hon. Members can see that I am not trying to insert an extra card with my name on it into the pack ahead of a reshuffle.

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

Shame.

[Penny Mordaunt]

Thank you.

At the Cabinet table, Secretaries of State are jealous of their remit, ready to explain when another policy trespasses on their departmental interest. If there was someone with responsibility for older people, the implications for them of each policy presented to Cabinet could be considered. We have had forums, tsars, taskforces and champions but we are still a long way from where we need to be. We need to try something new. An older person is likely to get a better standard of care on a hospital ward if there is one nurse on the shift with particular responsibility for that patient. Someone who has responsibility and is accountable will speak up to protect the interests of those in their care.

In the days leading up to the debate, it was suggested to me that older people are doing rather well at the moment. The Government have introduced the triple lock on pensions, guaranteeing that the state pension will increase by the greatest of earnings, prices or 2.5%. Pensioners enjoy free bus travel and winter fuel payments, and the over-75s get a free TV licence. The DWP has done well, so it is not a shock that the Department is responding to the debate, and I am delighted about that. Against those arguments, however, we have to consider the disproportionate impact of cost of living increases on older people. Saga has shown that between 2007 and 2012, retail prices index cost of living increases affected the whole population by 16.5%, but for 50 to 64-year-olds, the figure was 19.1%; for 65 to 75-year-olds, it was 22.4%; and for the over-75s, it was 22.2%.

We would do well to consider the many reports on health and social care that do not paint a rosy picture. The Equality and Human Rights Commission report on domiciliary care, the Care Quality Commission report on hospital care, the Centre for Social Justice report on quality of life in isolation and today’s CQC report on medication management beg to differ from the optimistic view. There is huge unmet need. In my city, Portsmouth, the local authority has budgeted for an extra 200 social care clients over the next five years, due to an ageing population, but today 1,000 people in the city have dementia and no access to any services. Major policy issues such as pension reform, which I am pleased the Government have tackled, and social care reform, which we still have to tackle—I am pleased that we are to do so—have been left for too long.

We need to do better. There is an argument for additional responsibility for a Cabinet member, but such an initiative will be judged on the practical differences it makes. What might they look like? A YouGov survey on the attitudes of people over retirement age found that 14% of people aged over 60 live more than 100 miles away from their most significant family members, excluding their partner. Six per cent have to travel between 50 and 100 miles to family, 8% between 25 and 50 miles, and 12% saw or heard from their family less than once a month. Isolation and inactivity were recognised by the House of Lords Select Committee on Science and Technology as accelerating

“physical and psychological declines, creating a negative spiral towards premature, preventable ill health and dependency.”

How are those issues reflected in transport policy? In my area, Southern Trains has recently introduced on the Portsmouth to Brighton route—a journey of 80 minutes —rolling stock that has no toilets. In rail franchise agreements, there is no mention of comfort standards or the provision of toilets, so old age pensioners could have to travel in crippling discomfort. The impact of the subsidy on train fares for old age pensioners is blunted, because it does not matter if the ticket is free when the mode of transportation is unusable. Older people are left with a poorer quality of life because there is another obstacle for them to overcome to stay in a job that involves a commute, and inactivity leads to demands on the health and social care budget. Transport Ministers may be sympathetic, but the Department refuses to act. A Minister for older people could intervene.

Let us look at the Treasury. In July 2011, the Office of Tax Simplification was asked to review the system for pensioner taxation. The interim report, published earlier this year, identified pay-as-you-earn on the state pension as an area to explore. People would not be taxed more, but would pensioners have to fill out self-assessment forms? Would they cope? Would they simply end up paying more tax through inability to process the forms? Plans have been mooted to combine income tax and national insurance contributions. Old-age pensioners do not pay such contributions, so will there be a different tax rate for them, or will pensioners be taxed more?

Quantitative easing and low interest rates are right for the economy as a whole, but they are not good for older people who annuitise their pensions and live off their savings. Quantitative easing has reduced gilt yields, on which annuities are based. The level of that annuity is then locked in. Should not offset measures be considered? What about an extra individual savings account allowance? More thought is needed if fairness is to be upheld.

Looking at work, economic analysts SQW found that older people benefit the economy by £175.9 billion, including £34 billion in social care and £10 billion in volunteering. Projections show that by 2030, those figures will be £291.1 billion, £52 billion and £15 billion respectively. That affirms what Saga has found about the willingness of older people to participate, in and out of work. Retirement is not a retreat from the world. Turning Point has asserted that integrated work to enable older people to stay independent for longer could produce savings of between £1.20 and £2.65 for every £1 spent from the public purse. Saga’s research suggests that 71% of over-50s would like to work part-time after 65, and 7% already work past the age of 70. The Office for National Statistics confirms that 1.4 million pensioners already work.

The demographic shift requires us to work longer, and we are willing and able to do so, but have businesses and industry really caught up? The Chartered Institute of Personnel and Development suggests that 14% of managers do not believe that their organisations are ready for an older work force. The Government have responded to that need and willingness by abolishing the compulsory retirement age and increasing the state pension age, but those excellent policies have not been accompanied by moves really to help employers manage their older workers and recruit new ones. At the close of 2011, 189,000 over-50s had been unemployed for more than one year. Of unemployed over-50s, 43% are long-term unemployed, compared with 26% of unemployed 18 to 24-year-olds and 35% of unemployed 25 to 49-year-olds. Training is often denied to workers nearing state pension age, as is promotion. Flexible working, phased retirement and mentoring schemes are few and far between. We need to do more to help older workers and to encourage employers to take them on.

In social care, we could certainly make better use of what we already have. As chairman of the all-party group on ageing and older people, I often hear care home providers boasting about their wonderful new home—its facilities, hairdressers, spas and shops. Those care homes’ doors are often closed to the local community, yet a few streets away there will be an elderly woman who is still independent, but whose quality of life suffers for want of a social life and bathing facilities. How many bathing facilities lie unused in our hospitals, homes and hospices?

Another example of missed opportunity is that most local authorities do not direct self-funders inquiring about care home options to financial advice. Instead, they wait until those people have spent their savings and are a burden on the state. Schemes that enable people to offset the cost of their care and keep their property assets intact by renting their home to the local authority, thus easing pressure on housing waiting lists, are not widespread, despite the headache that such initiatives would cure.

[Andrea Leadsom (South Northamptonshire) (Con)]

Does my hon. Friend agree that there is another anomaly in that a person who works and cares for their partner receives carer’s allowance, but as soon as they retire, although they continue to care full time for that partner, they have to choose either their state pension or their carer’s allowance? That is a direct incentive for caring retired spouses to call on the state for help, although it would be far better for their loved one if they continued to care for them, with a bit of state support.

[Penny Mordaunt]

My hon. Friend is absolutely correct, and I know that she has made that and many other suggestions to the Chancellor and highlighted the administrative savings, as well as the improvements to the individual’s quality of life, that would result.

Finally, let us look at Government communications. On taking office, the Government froze their £540 million advertising budget, and over the following nine months, they cut £130 million from it. Every time we mail an older person about approaching retirement or a free television licence and we do not accompany that mail with a flu-jab leaflet, information on the winter warmth scheme, or anything else that we want to send them that week, we are wasting that remaining budget.

Those are just a few examples of the way in which better focus in the Cabinet on older people’s issues could lead to improvements in the quality of life for older people and save us money. Who might be the person for that important job? It should not be the Secretary of State for Health or the Secretary of State for Work and Pensions, because the heavy duties that they already have in relation to older people could militate against the panoptical approach that is required. There is an obvious parallel with the Home Secretary’s additional remit for women and equalities; a similar duty for older people may sit well there. Such are the financial possibilities of the reform that perhaps the youngest and emphatically least grey member of the Cabinet, the Chief Secretary to the Treasury, should take on the role.

The Deputy Prime Minister, it appears, was at a loss as to what to do with himself in quiet hours at the Cabinet Office, and took to doodling constitutional wrecking balls on the back of fag packets. He is now very busy indeed encouraging us to abolish the House of Lords, where many older people are to be found doing great work for this country. If he turned his attention away from that constitutionally destructive policy towards this economically and socially constructive proposal, we would be much better off. There would be many candidates for the job and, given the massive gains to be made in the quality of life for older people as a result of effective and efficient government, as well as a better return on investment, one would think that there would be a long queue to do the job.

Further evidence of the need for a co-ordinating role is shown by how difficult it was to agree the responsibility to respond to this debate. I congratulate the Minister of State on stepping forward, on the work that his Department has done to protect the interests of older people, and on his initiative better to understand their needs through the UK advisory forum on ageing. I hope that he will take away from this debate the ideas and aspirations that contributors will discuss, and consider how we might do a better job of spotting the opportunities and understanding the ambitions of this generation. There is no better mark of the values of a nation than the way in which it treats its older generation. This Government, I am proud to say, are going to address the issue of long-term care, which will have far-reaching implications, and there is no better time to ensure policy on older people is well co-ordinated across Whitehall.

It is perhaps appropriate that our debate takes place on the day on which, at long last, Bomber Command has received the recognition that it deserves for its immense achievement and sacrifice. I hope that the Arctic convoy veterans, too, will soon achieve the recognition that they deserve. Many of us are wondering why something so needed, right and obvious should take so long to do. Quite.

[Several hon. Members]

rose—

[Madam Deputy Speaker (Dawn Primarolo)]

Six Members wish to take part in the debate, so it is necessary to have a time limit of 10 minutes, but if there are lots of interventions, we may need to revisit that.

[Kevin Brennan (Cardiff West) (Lab)]

On a point of order, Madam Deputy Speaker. I did not want to interrupt the hon. Member for Portsmouth North (Penny Mordaunt), but as of four minutes ago, the fifth written ministerial statement on the Order Paper, from the Secretary of State for Education, on educational reform, had not appeared in the Vote Office, despite its contacting the Department to remind it that it said that it would issue that statement today. Is it not a discourtesy to the House, Madam Deputy Speaker, that nearly six hours after the House began to sit, the statement has still not arrived? After all, the Department is quick to leak stories to the Daily Mail, but it is slow to provide written ministerial statements that it has promised to the House.

[Madam Deputy Speaker]

Mr Brennan, you will be aware of Mr Speaker’s ruling in this matter. He has indicated in this Session—and, indeed, it was indicated in the previous Session—that written ministerial statements should arrive promptly on the day for which notice has been given. That does not stretch on a Thursday to 4.30 in the afternoon, so I will make inquiries as to when we expect to receive the statement to which you refer. I am sure that Ministers will ensure that it flies here as quickly as possible, because you are clearly keen to read it immediately.

If there are no further points of order, perhaps we can move on. I call Julie Hilling.

16:29

[Julie Hilling (Bolton West) (Lab)]

I am extremely pleased to speak in the debate and delighted to follow the hon. Member for Portsmouth North (Penny Mordaunt). I thank her for leading our request to the Backbench Business Committee for the debate.

Last August I was invited to visit Ryelands court in my constituency. Ryelands is an Anchor Homes development providing flats for older people in Westhoughton. They asked me to sign their petition for a Minister for older people and I was delighted to join the 137,000 other people who thought this was a good idea. As only 34% of 65 to 74-year-olds and 31% of people over 75 feel that they are able to influence decisions affecting their local area, and when 1.8 million pensioners are living in poverty—that is 16% of people over state pension age—I absolutely agree with the campaign for a Minister for older people.

Labour has already recognised the need for such a position with the appointment of my hon. Friend the Member for Leicester West (Liz Kendall) as the shadow Minister for care and older people, with a seat in the shadow Cabinet. I very much hope this debate will encourage the Government to appoint a Cabinet member to champion the needs and aspirations of older people, with clear cross-departmental accountability for the services that they receive. One might ask why we need for a Minister for older people. Should it not be the responsibility of everyone? My experience of working with the issues of equality and discrimination over many years has taught me that as soon as we mainstream an issue and make it everybody’s responsibility, we lose focus and end up with nobody doing anything.

If we wonder why we should concentrate on older people, let me provide some statistics. Because of the baby-boomer generation of the 1950s and 1960s, the number of people over the age of 65 is likely to rise by 49% to more than 16 million in the next 20 years. Fortunately for the planet, but unfortunately for those of us who will be retiring, the growth in the younger population has not matched the longevity of older people and therefore many fewer people will be paying into the system. By 2020 more jobs are expected to be created than entrants to the work force, which is likely to mean that there will be considerable demand for older workers. However, there is significant age discrimination in our society. Policy Exchange did a blind study, applying for 1,200 jobs posing as both an older and a younger worker. The 51-year-old got fewer than half the number of positive responses that the 25-year-old received. Even though there are clear laws to prevent it, there is definitely a culture of bias against older workers.

We have also seen horrifying reports of the violation of older people’s right in the care system and in hospitals, including people being refused treatment on the basis of their chronological age, not on the basis of their fitness for treatment. We too often see older people as problems, not as equal members of society with the same hopes and fears as everyone else. Services to older people are not just about care, but about health, pensions, housing, transport, education and leisure, and we badly need someone around the Cabinet table championing their issues and making sure that there are no unintended consequences of policy.

Of course, the needs of older people can change very rapidly. Many hon. Members will have heard me talk on previous occasions about my mother’s journey. Twelve months and 10 days ago my mum was an incredibly active 86-year-old, still teaching three yoga classes a week, practising reflexology, driving her car, totally independent. Then, out of the blue, she suffered a very severe stroke. Overnight she went from an older person paying into the system to a recipient of care. During the past year Mum spent some time in acute care and a couple of months in a rehabilitation hospital, then she was back in acute care, and went into respite care for nearly eight months. She had fantastic physiotherapy and two months ago she made it back to her flat. Because the care home rarely sees anyone walking out on their own two feet, the staff laid out a red carpet for her. In fact, it was a pink blanket, but it was the same as a red carpet.

Mum now has carers four times a day, visits from the community matron, regular visits to the hospital, and is paying for physiotherapy. Whether it is because of her basic fitness when she had the stroke, or just because of her extreme determination—she is a very determined woman—she is continuing to make wonderful progress. The care that she received has varied from the excellent to the appalling, and if she did not have a family battling with her the whole way, I hate to think what may have occurred. She lost all dignity on this journey. The first day a young man wiped her bottom, she was so ashamed, but after 10 months she became used to depending on help—help that from the majority has been excellent, but a few of those who have cared for her should really think about a change in career. She is also £20,000 poorer and still worries about paying for her care. There are other costs. We have just booked to go on a cruise this summer, but it took me all day to find an insurance company prepared to insure her and, in the end, there was only one—thank you, Saga—at a cost of £750.

My mother’s story is not unusual. Families every day are facing the decision of whether or not to move their loved ones into a care home, wondering whether they can afford it and what will happen when the money runs out. We need someone at the Cabinet table battling for the Dilnot report or for another solution. Mum has been very lucky. Since the cuts to the Supporting People funds and local authority budgets, many people no longer receive any support in their homes. The £259 million Supporting People fund, which kept older people in sheltered housing, provided a net financial benefit of £1.1 billion by reducing the need for residential and nursing care, hospital admissions and home care. That money is gone. What a false economy.

As the hon. Member for Portsmouth North said, the House of Lords Science and Technology Committee has reported that isolation and inactivity accelerate physical and psychological decline, creating a negative spiral towards premature and preventable ill health and dependency. We now have a society in which often we live very far away from our loved ones: 14% of people over 60 live more than 100 miles from their most significant family member, and 12% of older people see family members less than once a month. The decline in adult education and the cuts to the voluntary sector leave more and more older people isolated in their homes.

Last month I visited Belong village in Atherton, a purpose-built and not-for-profit residential complex catering for people who need 24/7 care and also those who live independently in flats on the same complex. There are activities, a restaurant, exercise and much more, and it is open to the local community to come in and take part in those activities. We need to look at more examples like that and build homes that are fit for older people.

Hopefully, we will all become older people—in some people’s eyes many of us already are. Older people have specific needs that need to be championed. We need the Equality Act 2010 provision outlawing age discrimination in relation to goods and services to be implemented now, at a time when we have an ageing population who most need it. I hope that the Government listen to us, and the other 137,000 people, and appoint a Minister for older people as soon as possible.

16:37

[Margot James (Stourbridge) (Con)]

I congratulate my hon. Friend the Member for Portsmouth North (Penny Mordaunt) on leading the charge to secure this debate and all the other work she does on behalf of older people. It is also a pleasure to follow the hon. Member for Bolton West (Julie Hilling), whose mother I have had the privilege of meeting—she is indeed very fortunate to have such a daughter.

Before entering Parliament I was a local councillor in Kensington and Chelsea and served as older people’s champion for the borough. What I learned in that role has reinforced my support for the campaign, led by Anchor housing and supported by so many charities and housing organisations, for a clear voice at ministerial level for older people.

We already have Ministers with specific responsibility for women, children and people with disabilities. The Minister for Women is also the Minister for Equalities but, although that includes older people with regard to discrimination in the workplace, the Equalities brief is focused primarily on ethnic minorities and gay and transgendered people. If those five demographic groups are represented at ministerial level, why are older people not? Surely such different treatment implies some discrimination.

The arguments for having a Minister for older people go further than the fact that other demographic groups are represented at ministerial level. There are a specific set of interests and challenges associated with our ageing population that require the voice and insights of older people to be heard and taken into account across Government.

What would the role of an older people’s Minister involve? I have learned, from my own experience of a similar role locally, that older people’s interests are commonly perceived to lie in health, benefits and pensions, but that is a misperception, because older people have interests across a far wider spectrum of policy, and, as my hon. Friend the Member for Portsmouth North said, in areas such as transport their experiences are totally different, on account of their age, from those of younger people.

One policy area that is of prime importance today is the voluntary sector, and research by HSBC has found that the economic value of volunteering among people over 60 years old is £4 billion. My constituency has a remarkable voluntary and charitable sector, which relies hugely on the energy and dedication of large numbers of people who have already retired from paid employment, so an older person’s Minister should champion that aspect of their lives. They are not a cost to, and a burden on, society; they are contributors to society.

The requirements of a Minister go well beyond the role of champion, however. A Minister should do battle for the cause, and that involves questioning and challenging the effects of policy on older constituents. I have a few examples from the past and present.

The social care budget for the five years to 2010 was almost static, meaning that the same budget had to stretch to cover more and more older people, and that local authorities were no longer able to fund care for people in moderate need. They started to restrict care to people in critical need, and that is going to have implications for the future which an older people’s Minister would have been able to spot and to anticipate.

There is still plenty to challenge on behalf of older people, and, as the Minister of State, Department for Work and Pensions, the hon. Member for Thornbury and Yate (Steve Webb) is here to answer our debate, I congratulate him on securing the best ever deal, as announced this year, for pensioners, but he will know that existing pensioners are concerned about proposals for a flat-rate individual pension for new pensioners from 2015.

If the new pension were set at £140 a week, it would provide a couple who both drew their pension with an income of more than £14,000 a year. Currently, a couple in receipt of the basic state pension and the additional state pension receive an income of more than £11,000, however, so the difference between what I understand to be the new flat rate, £140, payable to both members of the couple and the amount paid to existing pensioners in a couple will be almost £3,000 a year. I welcome the desirability of a new system in terms of simplicity and the restoration of incentives to save, but I ask the Minister to address the sense of unfairness building up among the currently retired population.

There is also a need to challenge the “never had it so good” mentality that has built up among think tanks and interest groups, one example of which the Institute for Fiscal Studies published recently. There are affluent pensioners, and some are asset-rich and income-poor, but there is also considerable pensioner poverty. The scandalous deaths of older people each winter, owing to fuel poverty and numbering more than 20,000 in the most recent year for which figures are available, shame our society.

I have covered the importance of a Minister for older people as champion, advocate and challenger of policy, but the final critical aspect of the role would be to act as a critical friend to the older population; the job could not simply be to promote older people’s economic interests in a silo, as if the wider economy were not an issue. That is why I spoke up for the measure, announced in the Budget, to reduce the special tax threshold that is allowed for pensioners.

One of the toughest jobs of the Minister for older people would be to manage the expectations of our older population now and of the general population as they approach old age. The Government have taken difficult decisions to raise the retirement age and to put public sector pensions on a more sustainable footing, but we will in time have to go further. It is a year since the Dilnot commission reported on the funding of long-term care. I understand that there is no new money to fund Dilnot’s recommendations, and a new Minister will have to level with families and older people about what is affordable and what will have to be financed by individuals, families and private insurance schemes in future. I personally subscribe to much of what is in the commission’s proposals as regards standardising eligibility criteria, making care packages more portable around the country, and setting out standards that individuals and carers can expect.

I am pleased that the Government are going to bring forth a Bill in this Parliament to address these matters, and more, but I hope that if they accept the need for an older people’s Minister, that person would start to lay out what it is reasonable to expect and not to expect from the taxpayer towards implementing Dilnot’s fundamental recommendations on the funding of long- term care.

16:45

[Tony Lloyd (Manchester Central) (Lab)]

It is a pleasure to follow the hon. Member for Stourbridge (Margot James). I, too, congratulate the hon. Member for Portsmouth North (Penny Mordaunt), who made an intelligent and wide-ranging speech that helpfully set the parameters for this debate.

First, I want to talk about the treatment of the Arctic convoy veterans, which is a disgrace to our nation. My constituent, Mac McNeill, who was a boy when he volunteered to join what was unfortunately classified as the “non-Royal Navy”, experienced the most horrendous hardships during that period of his life and saw many of his friends and comrades die. He pointed out to me the irony of his having a chestful of medals from the Soviet Union—the Russian Federation—but very little by way of recognition from our own society. In that respect, I heartily agree with the hon. Member for Portsmouth North.

[Penny Mordaunt]

I do not know whether the hon. Gentleman is aware that the Prime Minister has instigated a review that is due to report imminently; I gave evidence to it, as did many other hon. Members. I therefore hope that the situation will be rectified very shortly.

[Tony Lloyd]

I strongly join the hon. Lady in hoping that that is the case. It is a matter not only of justice but of recognising the contribution that our fellow citizens made at a time of national need and crisis.

Secondly, we need to think about how we classify the needs of the elderly. The hon. Member for Portsmouth North rightly drew our attention to her 83-year-old constituent who is fit and active enough to jump out of planes—something that many of us in this Chamber would not want to do, at less than 83 years of age. I can think of people who would not necessarily be classified as elderly but have the same needs. Somebody said to me today that, ironically, dementia is not a working-class condition. That may be an extension of the reality, but there is some truth in it, because those who die younger suffer less from the conditions that are associated with age. Areas such as the one that I represent unfortunately have that social categorisation.

Someone recently drew my attention to a home where victims of stroke were given care, including a man in his fifties who was mentally very fit and active but physically severely taken down by the stroke that he had had. He found that he was treated wrongly in the same way as more elderly residents, but in his case it was more challenging because he knew what was going on. It is wrong that what he described could happen to anybody, but particularly wrong that it happened to somebody in their fifties. He knew that he was not being given his medication properly, but when he complained the staff treated him as though he were foolish, doddery and incapable of remembering, yet of course he had his memory and knew that he was being badly treated.

There is a real and proper concept of responsibility in issues to do with the elderly. Perhaps the Justice Secretary is the right person to take this on; I suspect that he has a natural feel for these issues.

We need to be careful that we do not silo what we mean by care for the elderly, because it covers a huge range of issues. It is important that we recognise that among the elderly are people like the elderly woman in my constituency who is well into her hundreds, but still helps those who are frailer than her, although considerably her junior, by taking them cups of tea and such like. When I asked her one day whether she was going to play bingo with the other old people she said, “No, no, I am going to walk down to the local commercial bingo hall—the prizes are better.” She does not need many of the things that would be classified as being for the elderly. It is important that we accept the point made by the hon. Member for Portsmouth North that it is the concept that we need, rather than an overly rigid classification of the elderly.

In my few remaining moments, I want to talk about something that troubles me and that I think will trouble all Members of the House. Every one of us would say that the recent case of the abuse of young children in Rochdale was an outrage and that the full force of the law ought to be used against those who brutally use and abuse our young children. We ought to have exactly the same sense of outrage at the abuse of the vulnerable and elderly. The stroke victim to whom I referred a few moments ago would be in that category. We are a considerable way off that.

I say to the Minister gently that the Care Quality Commission may have its merits, but the jury is out on what it has been doing. I heard on the radio this morning about its report on the giving of medicines. The comment was made—I paraphrase, but I do not think unfairly—that 80% of the time it is going well. Eighty per cent. of the time is not good enough when dealing with individuals. One hundred per cent. of the time is good enough. Ninety-nine per cent. is not good enough because it means that some people are not getting the medication that they need.

When there is abuse of the elderly, such as in the Winterbourne View case, we have to look to the criminal justice system. We need a much more robust system of whistleblowing, whereby those who feel that they are not being listened to can have their voice heard and can have matters fast-tracked. I concede that in many cases inspection is the right way to deal with such problems, but in the worst cases, the full force of the criminal law must be brought in to prevent the abuse. If we are not prepared to say that those who abuse our elderly will end up with criminal sanctions, we will have failed.

Last night, a debate was started about whether the criminal law has a role to play in dealing with Barclays bank. If we are prepared to talk about the role of the criminal law in dealing with financial irregularities, we should certainly be able to talk about its role when the vulnerable and elderly are treated in the most appalling way. Everybody would agree with that statement, but we must fast-track the process for those who are subjected to threats or to care that is inappropriate. There must be a system of gradation by which we begin to improve where improvement is possible and to clamp down on the very worst features.

I will finish as I began: by congratulating the hon. Member for Portsmouth North. This is a genuinely important debate. There are many other concerns for the elderly that we could raise and she has raised many important issues.

I will make one final point, which is slightly partisan, but is nevertheless important. The Prime Minister opened up a debate this week about how we treat people within the welfare system. He said that he would honour the pledge on the winter fuel payment and free transport for the elderly for the life of this Parliament. We could do with some clarification of what that means for after the next election. I understand that the Minister can answer for only one half of the coalition, but we need to have that debate. If we are to see changes in this area, they ought to be debated by society in general. If we are talking about the quality of life of the elderly, and not simply about the economic functioning of the elderly, we have to recognise that things such as access to transport and people’s ability to maintain their role as full members of society depend on a form of social contract. That is why a champion for the elderly would be an important step forward.

16:54

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

When I saw the hon. Member for Bolton West (Julie Hilling) and her mother in a wheelchair on the Terrace on the day of the flotilla, I had no idea what the circumstances were. I have now found out that it was the first outing for her mother. All I would say after the hon. Lady’s moving speech is that her mother can be extremely proud of her daughter.

My hon. Friend the Member for Portsmouth North (Penny Mordaunt) made a splendid speech—her remarks about the other place will live with me for some little while. I congratulate her on securing the debate, and the Backbench Business Committee, of which I am unashamedly a member, on having the good sense to grant it.

There is some disappointment with the motion. I had rather hoped we would be given the opportunity to make our pitch to become Minister for the elderly, but my hon. Friend cleverly says in the motion that the responsibility will go to a current member of the Government. I should also tell my hon. Friend that the longer she is here, the more she will struggle to find anything original to say. She will not be surprised that, over the years, a number of colleagues have made similar suggestions. However, I want her to be in a position to celebrate after the debate, and after, perhaps, we hear from No. 10 of the appointment of a Minister with responsibility for older people.

As my own dear mother starts her second century, I have some experience in these matters. There seems to be a fashion—I think it was started by my hon. Friend the Member for Harlow (Robert Halfon)—for colleagues to go around with broken arms, wrists and knees, and hip replacements. Everyone seems to be on crutches or in wheelchairs. Only when people associate with those who need wheelchair assistance do they stop saying, “What a wretched nuisance” when they see someone trying to get by on a Zimmer frame or in a wheelchair. They instead say, “How can we raise the money for a lift for elderly people?” Only when those things touch people do they realise how valuable they are, as the hon. Member for Bolton West rightly reminded the House. I congratulate Anchor, which is a wonderful organisation, on getting 140,000 people to sign an online petition. That is a great triumph.

Many people would say that as people move on and become older, they return to childhood. I do not mean that judgmentally. When we are very young, we are totally dependent on others, which is eventually what happens in later life. There is a further link between young and old: they are the times of life when people are best placed to impart wisdom. Older people’s roles as grandparents and great-grandparents should be recognised—that vital glue across generations holds our society together.

There is a crucial difference between the old and the young in this country: younger generations are heavily catered for in politics through the Department for Education, but far less support is available for those classified as older people. We used to hear about joined-up Government and Departments working together. No doubt the Minister will contradict me, but I need to be convinced that that is happening currently. For the sake of joined-up Government, however, I congratulate my hon. Friend the Member for Portsmouth North—my younger hon. Friend—on introducing the motion to give a Minister responsibility for older people.

According to Age UK Essex, there are fewer under-18s in the UK than over-65s. The total number in this age group stands at 10.3 million. Each year, 650,000 more people turn 65, and one-fifth of the population is of pensionable age. What is more, with ever-better health care, life styles and support, more people are living longer. On average, people in Southend live to 80. We all welcome that change, of course, but we want people to grow old with dignity. According to projections from Age UK, the number of people aged 60-plus will increase by 50% over the next 25 years, while in 2083 one in three people will be over 60. So we are clearly faced with a serious problem.

My constituency has the most senior citizens in the country. Every year, we have a tea party—we have been in the Guinness book of records three times and are having another one this year to break the world record again. It is wonderful: as they leave the tea party, they always say, “See you next year.” According to recent statistics outlined by Age UK, 36.1% of Southend’s population is classified as “old”. More than 24,000 people are aged between 65 and 84, while more than 5,000 are over 85. The trend in Essex is clear: over the next 15 years, we can expect a 39% increase in the number of over-65s.

All I am saying is that this is happening, and we cannot bury our heads in the sand. In earlier years, we have had big arguments about people having to sell their homes—it was all wrong in terms of people’s inheritance and so on. It will be a brave political party—I know we have a coalition at the moment—that faces up to the terrible question of how we fund the future care of an ageing population. When I go around the excellent care homes in my constituency, it is heartbreaking to be told, “There are never any visitors for some of our residents, but when it comes to the funeral, they all turn up to see what they’ve been left.” These are real issues that we need to face up to.

There is a wide variety of issues affecting older people, and services need to be co-ordinated. From pensions, and health and social care, to fuel poverty and housing, each individual will have problems unique to them, and in most instances these problems will span several Departments. Essex Age UK has researched what sort of support older people would like, and its conclusions included: mobility, managing personal affairs, transport, better access to information and recreational opportunities. Older people need to be stimulated. It is no good everyone sitting in a lounge with no stimulation. If we stimulate older people, their quality of life improves.

[Dr Wollaston]

Would my hon. Friend add to his excellent list the role for technology in helping to improve the lives of older people? In my area, Devon and Cornwall, more than 250 older people go missing every year, many of them with dementia. Many technological advances can be used to give older people much greater confidence to go out, knowing they can be found quickly and easily, and to reduce distress. Also, many technological improvements can keep older people in touch, give them a link with younger people and improve their IT skills.

[Mr Amess]

I agree wholeheartedly with my hon. Friend, who is right to mention dementia. Fortunately, in our area, through the generosity of a local resident, Ivan Heath, we will shortly be opening Peaceful Place to care for people with dementia. My goodness that is an issue we must increasingly face up to, given our ageing population. She is also right to talk about the assistance that improved technology can provide.

The Dilnot commission, agreed to in the coalition agreement, has now reported, with some controversy. I have been involved in this issue for some time, and in 2000 I was fortunate to come fourth in the ballot for private Members’ Bills, so I am associated with the Warm Homes and Energy Conservation Act 2000, which sought to eliminate fuel poverty, and the more that colleagues can do to advertise the help available to older people, the better. There is much they can claim.

In conclusion, there is a good precedent for creating a Minister for older people within the current Government. We have a Minister for nearly every walk of life—for children, for disabled people, for women and equalities—so why can we not have one for older people? Such a position might even warrant a promotion. My right hon. Friend the Member for Maidenhead (Mrs May) who does a splendid job as Home Secretary is concurrently the Minister for Women and Equalities, managing both roles equally well. A dual role could easily be managed by one of my right hon. or hon. Friends. It is important to note this has been done internationally—in Ireland, Canada and New Zealand, for example. Ministers for older people have been appointed in those countries.

We should do everything we possibly can to ensure that people in old age are treated with as much respect and dignity as possible. They have worked all their lives, experienced a huge number of scenarios and situations and contributed to this country in countless ways. If it were not for the sacrifices of older people in the first and second world wars, we would not have our Parliament today. We have a duty to support them. I congratulate my hon. Friend the Member for Portsmouth North again, as this debate represents a significant step in the right direction. I fully expect a Minister to announce from the Dispatch Box at the end of the debate that the Government will indeed appoint a Minister for older people.

[Several hon. Members]

rose—

[Mr Deputy Speaker (Mr Nigel Evans)]

Order. Will Members please resume their seats. An earlier point of order related to written ministerial statement No. 5, which Kevin Brennan said had not been lodged. The House will wish to be informed that it has now been lodged.

17:06

[Dr Daniel Poulter (Central Suffolk and North Ipswich) (Con)]

It is a pleasure to follow my hon. Friend the Member for Southend West (Mr Amess), who made a fantastic speech, highlighting the human challenges that many older people face and rightly arguing that people who have worked hard for our country deserve to be properly looked after in their retirement.

I pay tribute to my hon. Friend the Member for Portsmouth North (Penny Mordaunt) for initiating this debate. She was absolutely right to say that we need a more integrated approach to elderly care nationally and locally. She was also right to highlight the importance of housing as part of that integrated approach. I am somewhat reassured that this Government have already taken great strides in the right direction properly to support and recognise the needs of older people. I am somewhat more reassured than my hon. Friend about the Government’s plans to reform the upper House. I look forward to speaking in support of those plans in the debate that will take place shortly.

Before the general election, Age UK set an important test on the key challenges facing elderly care in this Parliament. It is worth highlighting what those challenges were and measuring what the Government have done to meet them. We can be greatly reassured that the Government are already well on the way to dealing with many of the issues older people face today.

First, Age UK set out the problem of forced retirement, which it said must be ended by scrapping the default retirement age. The Government have clearly done that in their first few months. Older people should be allowed to work while they are able to work. The default retirement age discriminated against the valuable contribution older people can make and continue to make to the workplace. This Government should be proud—I am proud to be part of them—of scrapping that discrimination against older people. Government Members can all be proud of that.

The second test set by Age UK was that radical reform of the care and support system should be taken forward as an urgent priority. I am pleased to note the consensual approach across the House today, which, wherever possible, is an important part of that. I am greatly encouraged by the fact that the Minister with responsibility for adult care and social care will respond later this year to the Dilnot commission’s funding proposals and assess how we can better look after older people and better integrate care at the local level so that we can provide greater dignity in elderly care. We have heard a lot today about abuses and indignities and about variability in the care system, which was brought home to us very effectively by the hon. Member for Bolton West (Julie Hilling). It is important that the Government continue to support older people and improve the social care system.

The third test that Age UK set for the incoming Government before the election was that they should prevent the current system from collapsing, and introduce proper safeguards that would guarantee joined-up, integrated care through health-related spending. The Government have already committed themselves to investing £3.8 billion in the NHS to provide the necessary integration between the NHS and social care. My hon. Friend the Member for Portsmouth North rightly said that more joined-up care was needed at a local level. Only if that additional £3.8 billion is filtered into local NHS providers—hospitals and primary care providers—will we be able to secure the joined-up, integrated care, involving adult social services and health care providers, that we need so badly in order to focus on preventive care for older people.

Age UK’s fourth challenge was that the commitment to link the basic state pension with earnings must be honoured by 2012, and pension payments must be increased over time as and when that became affordable. The Government have already achieved that as well. The triple lock on pensions will ensure that, for the first time, older people will receive a meaningful increase in the basic state pension every year. That will help them to meet the rising cost of living, especially in these difficult economic times. The commitment in this year’s Budget to increase the basic state pension to £140 a week is a commitment of which the Government can be proud, and we know that it will become a reality in the future.

The fifth and final test was that NHS resources must be redirected towards community health services that sustain a good quality of life by preventing and treating common health conditions. As I have said, the Government have made a clear commitment to invest £3.8 billion in the NHS to support interaction with local social care services, but, in addition, a major element of their health care reforms was the establishment of health and wellbeing boards. For the first time, primary care practitioners, secondary care clinicians, nurses, housing providers such as Anchor—all the key players who are so essential to providing that joined-up, integrated care for older people—will be brought together.

As has already been said today, it can no longer be considered acceptable for older people to fall and break their hips because of poor housing conditions and poor lighting in their homes, and for the NHS to have to deal with the consequences. The challenge must be to provide more integrated care and better preventive care, and we will do so by ensuring that all the key players work together properly. The establishment of local health and wellbeing boards was a step in the right direction towards the provision of the joined-up, integrated care that we want, which will save the NHS money, but, more important, will provide dignity in elderly care.

Already, two years into the current Parliament, the Government have passed all five of the tests set for them by Age UK. We look forward to the proposals for meaningful reform of the social care system and proper funding that the Government will present later in the year, but I am reassured that they are already making great strides in relation to elderly care. What they are doing for older people has already surpassed what has been done by many Governments in the past.

Although I consider the appointment of an older people’s Minister to be a laudable notion, I think that the Government are doing very well already.

17:14

[Paul Maynard (Blackpool North and Cleveleys) (Con)]

I congratulate my hon. Friend the Member for Portsmouth North (Penny Mordaunt) on securing this important debate, and I am glad to have an opportunity to raise the views of Blackpool here in the Chamber. Blackpool is in many respects a pensioners’ capital. We have just hosted the National Pensioners Convention, at which the Minister with responsibility for adult and social care, my hon. Friend the Member for Sutton and Cheam (Paul Burstow), was due to speak. Unfortunately, however, he had to return to the Chamber to reply to an Opposition day debate. The NPC replaced him at the Winter Gardens with a cabbage. I am not sure what fruit or vegetable the pensions Minister might like to be represented by; he might tell us when he delivers his winding-up speech. I should warn him, however, that the banana has already been taken by the right hon. Member for South Shields (David Miliband), so it is off the menu.

My hon. Friend the Member for Southend West (Mr Amess) told us that his constituency had the most pensioners. I am trying to compete with him in that regard. As with most coastal towns, both Blackpool and Southend have large populations of retirees.

[Mr Amess]

Has there been any reaction yet among older people in my hon. Friend’s constituency to his winning the very special charity champion award last night?

[Paul Maynard]

Modesty forbids me from commenting, so we will draw a veil over that.

My constituency has the most people who live in a household with someone with a long-term medical condition, so carers policy perhaps matters more there than in any other seat. I am therefore as aware as any Member about some of the issues raised today.

In order to access carer’s allowance, people have to apply for pension credit, to which they may not be entitled. People might know that that application will be rejected, but they still have to apply in order to access carer’s allowance—an obvious anomaly in accessing benefits. Although we all know that many pensioners do not claim everything that they are entitled to, they are still not getting what they should be getting.

I know from my postbag and my surgeries that there would be no shortage of work for a Minister for older people. Almost every Government Department has some policy issue that matters more to older people than to any other group.

The Service Personnel and Veterans Agency is located in my constituency. I will spend the next three days attending various Blackpool veterans week events, because I know that matters, not least to my older constituents. My hon. Friend the Member for Portsmouth North talked about the Arctic convoys medal, too.

Buses are another key issue, as in my constituency they are used predominantly by elderly residents. There are also complicated matters such as the past presence test, about which we are arguing with the European Union, as well as eligibility for benefits when abroad, and what happens when people return. There is a long list of such issues—and I have not yet mentioned long-term care for the elderly and the Dilnot report.

I am something of a nostalgia specialist. I like to look back at the first post-war Labour Government, and try to do so with a degree of fondness because they knew how to use royal commissions as a policy-making tool. They managed to secure all-party support, and produced some of our greatest welfare reforms. Sadly, the last Labour Government turned their back on royal commissions as a policy tool. I remember the royal commission on long-term care. It was a gargantuan exercise—voluminous, colourful, pretty—yet it was utterly ineffective because nothing ever happened after it. The journey to secure reform of long-term care has been long, arduous and, hitherto, fruitless, yet I retain some optimism that the current Government might find enough coins down the back of the sofa to get things right this time; I have my fingers crossed.

As well as the range of issues Members on both sides of the House have raised today, it should be stated that we face a demographic challenge, which we must overcome. It is time that we thought about setting up a royal commission on the consequences for this country of having an ageing population. It would cover a much wider remit than trying to solve a specific policy problem. It would assess what the challenges are and what they mean for every Government Department.

A key issue in this regard is the consequences of having a population that is—to put it crudely, perhaps—dying more slowly. We no longer die rapidly from heart attacks or other such conditions that might hit us in our prime. Now, the decline is much slower and gradual, and it is much more expensive for the taxpayer in providing appropriate care. That deserves some analysis.

The specific proposal to have a Cabinet Minister in this area is an interesting one. This question is not so much about policy towards the elderly, but about government architecture: how do we make things happen in government? As many have pointed out, we have Ministers for the disabled and for children. Both positions are at Minister of State level and both cross more than one Department. We also have a Minister for pensions—the Minister of State, Department for Work and Pensions, my hon. Friend the Member for Thornbury and Yate (Steve Webb), whom I am delighted to see on the Front Bench today—and a Minister for adult social care. Perhaps they could arm-wrestle each other for the title of being the Minister for older people. That Minister could sit across both the relevant Departments and perhaps could have the same effect that the Ministers for children and for the disabled are having. I do not think that someone needs to be in the Cabinet to achieve things. There is a grave danger of our being more concerned about the name and where this person sits than about what they can actually achieve. We have had a history of tsars—an entire palace of Romanovs was produced by the previous Government—all of varying effectiveness, which was often not related at all to where they sat or where their home was. What matters is what someone does.

It is worth looking at what is done abroad, because there are some instructive lessons. I do not normally take the French as a model of how to behave in any situation in life, but they have often had a ministry of solidarity between the generations, as they put it. That is an interesting concept. We often battle in this country, with some saying that the young are getting too many resources and others saying that the elderly are. That French Department tried to resolve the two, to bring them together and to work out how intergenerational solidarity is actually created. To be honest, I do not know whether it worked terribly well, but it is an interesting idea that is worth thinking about.

Australia has a Minister for Mental Health and Ageing, who is No. 2 in the health Department. So the Australians do have a Minister for older people, although some might quibble about the linking of those two things. In Ireland, Áine Brady, a Fianna Fáil Minister in the previous Government, was Minister for Older People and Health Promotion. Sadly that particular Government left office—it was not sad for the Irish people, as this is democracy—and the current Government decided not to retain that title.

I note that the Labour party has a Front-Bench spokesman on this specific issue. I can go as far as to welcome that, but I note that in opposition we had a shadow Minister for coastal towns and that role did not survive the transfer to office. It is far easier in opposition for people to create the architecture around what they want to campaign on, rather than around the architecture of the Government buildings that they then have to slot into. So that provides a good example, too.

The example I pray in aid in particular is that of New Zealand, which does have a Minister for older people, sited in its Ministry of Health. New Zealand also has an office for senior citizens, situated in its Ministry of Social Development. That is a particularly interesting combination. Before Conservative Front Benchers start to worry that I am proposing yet another quango, I can tell them that they need not fear as nothing could be further from my mind. None the less, what both Ireland and New Zealand had in common was that they had first developed what they called a “positive ageing strategy”. So before they appointed the Minister, they ensured that the Minister had something to do. One of my concerns is that if we have a general Minister whose objective is to proof all policies so that older people do not experience a disbenefit, we will end up getting a bit fluffy and soggy. I would far rather have a set of very specific areas that affect older people that the Government should be focusing on; these would be certain policy areas that should be driven through.

As much as I love the Deputy Prime Minister—I adore him, I swear I do—I know that he is burdened by trying to cope with the problems of social mobility, which are being discussed in Westminster Hall at the moment. I am not sure that I would wish to give him older people to deal with as well, because he has to fit in trips to Rio; one man cannot do everything, surely. Rather than simply nominating one Cabinet Minister and tacking older people on to the end of their responsibilities, I would far prefer it if we created a new role that had a very specific remit, that had a positive ageing strategy behind it and that had only a handful of specific policy proposals to see through. In this country, we do not define the remit of a Government Department closely enough. We have aspirations, but often they read to me as waffle. A good example is HS2. One of the Department for Transport’s goals is to introduce HS2, which is fine, but it never says why that is particularly important. It states the goal, not the reasons for it. I would far rather we had a much narrower focus.

I welcome the debate and think it is an opportunity to put dignity at the forefront of everything we do in government. Sometimes, I am disappointed that Ministers do not always have dignity at the forefront of their minds in every decision they take. We should not need a new Minister to achieve that, but if that is what it takes then so be it. Once again, I congratulate the hon. Member for Portsmouth North on securing this important debate.

17:25

[Liz Kendall (Leicester West) (Lab)]

I start by thanking the Backbench Business Committee for enabling this important debate to take place, and I congratulate the hon. Member for Portsmouth North (Penny Mordaunt) on securing it. I know that she has been very committed to the issue and I am delighted that we have discussed it today. I also thank my hon. Friend the Member for Bolton West (Julie Hilling), the hon. Member for Stourbridge (Margot James), my hon. Friend the Member for Manchester Central (Tony Lloyd), and the hon. Members for Southend West (Mr Amess), for Central Suffolk and North Ipswich (Dr Poulter) and for Blackpool North and Cleveleys (Paul Maynard) for their speeches.

In particular, I thank Anchor for the superb Grey Pride campaign it has run and the 137,000 people who signed its petition, which made today’s debate possible. As hon. Members might know, the Leader of the Opposition created the post of shadow Minister for older people in the shadow Cabinet in October last year, and I feel privileged and honoured to have been appointed to the position. I hope the Government will follow suit and appoint their own Minister for older people in the Cabinet, and I will use my speech today to explain why.

My first point is obvious, but none the less important: older people are not an homogenous group. They have different views, needs and expectations, just as people in any other age group do. We would not treat everyone aged nought to 50 as a single group, yet this is exactly what we do for people aged 50 to 70, 80, 90, 100 or even beyond. Our discussions and debates about older people tend to be based on one image or stereotype, usually that of a very elderly person, frequently frail or dependent and in need of care and support. The need to develop a better, fairer system of care is a huge challenge and one that I will return to later, but the reality is that most people in their 50s and 60s are not frail or dependent and they want never to be so. Rightly, many do not regard themselves as old at all—my mum and dad certainly do not. Many older people are still in paid work, and local businesses and the economy benefit hugely from their skills, experience and incomes. They play a part in their local community, in voluntary groups or as councillors, and they help with local public services and in churches and faith groups. They also help to look after their grandchildren, and sometimes their own elderly parents; an increasing number do both.

Before I came to the Chamber, I was at a very interesting event organised by Grandparents Plus where I was told that 28% of grandparents have parents still living. They are a sandwich generation, helping out with the kids as well as helping their own parents. We have what I would call the young old as well as the older old, and the young old want to try new things, especially when they have retired, to develop new skills and to travel to different places. They want to enjoy their lives. They want to have fun, if they have time to do so after all the other things they are doing.

The aspirations of today’s over-60s are in many ways quite different from those of previous generations. My parents have quite different expectations from their parents of the kind of life they want. My expectations, those of my niece and those of the one in three babies born this year who will live to be 100 years old will be very different in the future too.

If older people are not an homogenous group, if they have different views, needs and expectations, why have a Minister for older people? The first reason is that despite all their differences, one thing that the young old and older old frequently say is that they too often feel invisible to politicians, businesses, public services and the media. That is a key reason behind the Grey Pride campaign: to ensure that the needs and views of older people are heard and understood at the highest level, so that we can change attitudes about older people, challenge the stereotypes and put older people at the forefront of British political debate. Of course, a Minister for older people could not do that on their own: local businesses, councils, public services, voluntary groups and the media all have a vital role to play, but the Government can and must take action. The previous Labour Government’s Equality Act 2010 will be crucial in helping to turn the tide on some of the age discrimination we see, including in goods and services, but Governments must also take positive steps to ensure that older people’s needs and concerns are actively promoted in every area.

That leads me to the second reason why we need a Minister for older people: to ensure that all Departments understand the issues facing older people and that work is properly co-ordinated across Government. Many hon. Members have discussed the different Departments that need to understand the views, feelings and expectations of older people. Let me repeat some of those and add some more.

[The Minister of State, Department for Work and Pensions (Steve Webb)]

I am listening to the hon. Lady with great interest and I congratulate her on her role. Does she think that because for 13 years the previous Government did not have someone in this role, they failed older people?

[Liz Kendall]

I think we made big improvements for older people, but far more needs to be done. One of the biggest challenges—transforming the care system for older people—requires action across Government. It is not something that a Minister for older people could do on their own. They would need the Treasury, No. 10, the Department for Work and Pensions and other Departments to be closely involved. It is a matter of having someone who can help to co-ordinate action across Government and provide a stronger voice at Cabinet level. That is the role a Minister for older people would perform.

Let us consider some of the other areas in which we need to make sure that older people’s needs and concerns are heard. Take education policy, which some might not think would be relevant. We need to understand that as people live longer and need to work for longer, lifelong learning is essential to help them to develop new and different skills. In family-friendly working, we need to understand that a quarter of all grandparents— 3.5 million in total—are still working as well as helping to look after their grandchildren.

Several hon. Members have mentioned housing policy. We must ensure that there is a range of good-quality options for people as they get older, so that they are not given a choice between living in their own home or a care home; there should be various stages in between. Transport policy is also very important. I am sure that many hon. Members find that bus services are a big issue in their constituency. Making sure that services are linked up is a big challenge. Our energy policy must also take into account the needs of older people, many of whom have very high energy and heating bills, particularly if they have long-term health conditions.

Having a Minister for older people in Cabinet would help to ensure that all Departments were more aware of the issues and concerns I have raised, but the final and most important reason why we need the role is that, as a society and a country, we need to face up to the major economic and social challenges of demographic change. That is a key issue behind Grey Pride’s campaign and is highlighted in the motion. Many hon. Members have spoken about pensions, and I am sure the Minister will speak about them too, but I will focus on care and support.

That must be one of top priorities for the Minister for older people because it is one of the biggest challenges facing Britain today. That is why one of the options would be to have the Minister for older people in the Department of Health, because the key to transforming the care system is in transforming the NHS. Social care budgets have been under increasing pressure for many years, but the care system has now reached breaking point. Adult social care makes up around 40% of local council budgets—up to 60% in some areas—and it is their biggest discretionary spend. When the Government are cutting local council budgets by a third, it is inevitable that services for older people will suffer. Figures from the Department for Communities and Local Government show that more than £1 billion has been cut from local council budgets for older people’s social care since the coalition Government came to power. The result is that councils are raising their eligibility criteria: 80% now provide care only for those with substantial or critical needs, up from 50% only four years ago.

[Margot James]

Does the hon. Lady not accept that the phenomenon of councils changing their eligibility criteria to restrict care to critical level started way before the cuts to local government budgets?

[Liz Kendall]

I did say that social care budgets had been under increasing pressure for many years, but local councils are now facing cuts of a third in their overall budget. Adult social care is their biggest discretionary spend, so they face real challenges and are moving their criteria from modest to only substantial and critical need.

Preventive services have all but disappeared in many areas. Fewer older people get free care; more end up having to go into hospital, or are unnecessarily stuck in hospital or more expensive residential care. Charges are increasing across the country and vary hugely depending on where people live. It is not just older people who are suffering, but their families. Carers suffer ill health and some have to give up work because the right services are not available. There are costs to the taxpayer if they are not in work and contributing financially. There are also increased benefit bills.

The fundamental problem, and another reason why a Minister for older people is important, is that our welfare state was established in a very different age. In 1948, average life expectancy was 66 for men and 71 for women; now, it is more than 78 for men and 82 for women. Some health conditions that are now common amongst older people, such as dementia, were almost unknown back then, and many disabled children died at a young age. Social expectations were very different. Disabled adults had fewer rights, and people automatically assumed that women would stay at home to care for their families.

[Dr Poulter]

Will the hon. Lady give way?

[Liz Kendall]

I have a little more to get through, but I will take the hon. Gentleman’s intervention.

[Dr Poulter]

I am going to be supportive. The hon. Lady is making some good points. Does she agree that not only the welfare state was set up for a previous era, but also the NHS? It is a crisis-management system built around acute hospitals, and the challenge has to be to deliver more care in the community.

[Liz Kendall]

I thank the hon. Gentleman. I meant welfare state in its broadest sense, including the NHS. That is the big challenge for us. We have to make a fundamental shift in the focus of services—out of hospitals, into the community and towards prevention and early intervention to help keep people as fit and healthy as possible for as long as possible. Services need to be more joined up and personalised to meet individual needs.

The previous Government made big improvements. We backed integrated care, including care trusts such as the one I recently visited in Torbay, which has made huge progress. We invested £230 million in extra care housing projects, which have made a big difference in older people’s health and physical condition, and we introduced personal budgets and direct payments. I hope that this Government will build on many of those developments in their long awaited White Paper, but we shall not be able to tackle the care crisis unless we reform care funding.

Several Members have talked about the Dilnot commission, which represents the best opportunity in a generation to reform the way care is funded. It is an opportunity that politicians in all parties must grasp with both hands. We tried to get cross-party agreement on social care funding at the last election. We did not succeed, but we are determined to try again now. That is why my right hon. Friend the Leader of the Opposition initiated cross-party talks when Dilnot’s recommendations were published.

I am concerned about the fact that the Government have backtracked on their promise to legislate in this parliamentary Session for new legal and social frameworks for social care. The Queen’s Speech included only a draft Bill on reforming social care law. The Opposition want legislation on a new system for funding social care in this Parliament, and we are pressing for that in the cross-party talks, but that can only come about if there is commitment at the highest level—not just from a Minister or shadow Minister for older people, but from No. 10, No. 11 and other members of the Cabinet.

Our ageing population is something that we should celebrate. Older people make a huge contribution to their families and our society; I see that in my constituents’ lives, and in mine—as often as I get to see my parents. However, our society has barely begun to understand the implications of this vast demographic change. A Minister for older people would make a big difference, but it is incumbent on all politicians—local and national—across the spectrum to understand that we must work together to deliver a better, more dignified life for people, so that they can live a long, fulfilling life, and have more life to their years, as well as more years to their life.

17:41

[The Minister of State, Department for Work and Pensions (Steve Webb)]

There were just eight contributions—but eight high-quality ones, from Members on both sides of the Chamber—to this debate on an important issue. The unanimous view of all those who took part was that we should congratulate my hon. Friend the Member for Portsmouth North (Penny Mordaunt), who introduced the topic in a very effective way. I also congratulate her on the work of the all-party group on ageing and older people, which she chairs, and I congratulate the Backbench Business Committee—some of its eminent members are here today—on making sure that we had the time to discuss the crucial issue of how we best ensure that older people have an effective political voice. That would be the united perspective.

We have heard diverse views. We heard a suggestion that the Minister for older people should be an additional role for the Home Secretary. We heard it suggested that it should be the Chief Secretary to the Treasury, or perhaps another Cabinet Minister. My hon. Friend the Member for Central Suffolk and North Ipswich (Dr Poulter) suggested that the Government were doing pretty well without a Minister for older people, although the post might be a welcome addition.

I assure the House, from my now extensive experience—two years—in government, that the idea that the views and priorities of older people are not in every room, in every discussion, is not something that I have ever encountered. To give just one example, the Department for Work and Pensions had to make some very difficult decisions as part of the comprehensive spending review, but if we look at the areas where savings were made—at the reduction in the growth in the budget for disability living allowance for people of working age; at the local housing allowance; at the employment and support allowance; at child benefit, tax credit, and social housing; and at the benefits cap—virtually without exception, those changes apply wholly or predominantly to those of working age. The benefits of those above pension age were protected, almost exclusively. As we have heard from a number of hon. Members, crucially, the basic state pension has been enhanced through the restoration of the earnings link and the triple lock. I assure hon. Members in all parts of the House that the political priorities of pensioners and older people more broadly—as we all know, they are the people who turn out and vote—are very much in the Government’s mind at all times.

My hon. Friend the Member for Portsmouth North suggested that there had been some discussion about who should reply to the debate, and she is correct. Part of the reason is that so many Ministers have a keen interest in the concerns of older people. There were many potential candidates, but I fought them off. I want to respond to some of her particular points, and in doing so, reassure my hon. Friend the Member for Southend West (Mr Amess), who was sceptical—I was shocked by this—that there is still joined-up government when it comes to older people. As I run through my response to some of the concerns of my hon. Friend the Member for Portsmouth North, I hope that it will be apparent that I am giving a litany of examples of joined-up government.

My hon. Friend raised the very important issue of loneliness. A number of people mentioned nobody visiting the care home, but everyone coming to the funeral for the reading of the will. That was a powerful point. There is a powerful cross-departmental partnership between the DWP and the Department of Health. The Minister of State, Department of Health, my hon. Friend the Member for Sutton and Cheam (Paul Burstow), the Minister responsible for care services, has pioneered work on loneliness. We have worked with the Campaign to End Loneliness. There was a summit on 15 March that I attended, which my hon. Friend chaired, on how Government and local government can act effectively on loneliness. Something that has emerged from it is the importance of equipment for local authorities that want to tackle loneliness in their area, including “how to” guides, websites and so on. We take the issue very seriously: too often, we talk about care, transport, health or pensions, but the fundamental issue of whether someone sees anyone from day to day and whether anyone cares whether they are there or not is a vital one, and I am grateful to all the hon. Members who mentioned it.

Something that has come out of our work is the age action alliance, which brings together more than 200 organisations, including Government Departments, private sector bodies, charities and voluntary groups. The alliance operates under the umbrella of Age UK, and is supported by the Department for Work and Pensions. It tackles a range of issues affecting older people in a joined-up way across sectors. Loneliness is one of the key themes that it is looking at.

My hon. Friend the Member for Portsmouth North mentioned taxation and older people. Let me say on the record that if tax and national insurance were brought together in a single operation, national insurance would not, I can assure her, be applied to pensions. There is no proposal to bring pensioners into that higher combined tax rate. In an example of joint working, the DWP and Her Majesty’s Revenue and Customs are working together on the recommendations from the Office of Tax Simplification. I can assure her that, as Pensions Minister, I will scrutinise exceptionally closely any suggestion that tax might be withdrawn at source from the state pension.

My hon. Friend and my hon. Friend the Member for Central Suffolk and North Ipswich raised the abolition of the default retirement age, and the position of older workers more generally. As I mentioned in oral questions this morning, that is something of which the coalition Government can be resolutely proud. There were years of talk about abolishing mandatory or forced retirement, but we have done something about it. There is still more to be done: employer attitudes to older people still need work, which is why the DWP and the Department for Business, Innovation and Skills work jointly on that. In fact, BIS-led legislation has been introduced. We have worked with employers and business organisations on the “Age Positive” initiative to challenge outdated assumptions about older workers and to encourage improvements in the employment and retention of older workers as part of a mixed-age work force.

Older workers are good business. I said this morning in the House that research evidence from McDonalds has found that McDonalds restaurants that employ over-60s have on average higher customer satisfaction than those that do not do so. Some people might find that surprising, but it is an example of enlightened employers who get it, and who do well as a result. We shall certainly spread the word.

My hon. Friend the Member for Portsmouth North raised the issue of someone who goes into a care home and wants to be able to get something from the value of their home. I think she referred to the Redbridge “FreeSpace” pilot, and spoke about it very positively. I can assure her that my hon. Friend the Minister for Housing and Local Government has encouraged other local authorities to look seriously at that innovative project, and is trying to promote it, as she suggests.

My hon. Friend suggested that we do more to communicate with people and that it was important to piggyback messages. I agree, which is why the DWP is working with the Department of Energy and Climate Change on a pilot scheme to promote the green deal. When we write to people about winter fuel payments, we take a target sample of 1.2 million letters, and those recipients will receive a separate flyer in the envelope promoting the green deal to encourage them to take up energy efficiency schemes. My hon. Friend the Member for Stourbridge (Margot James) mentioned excess winter deaths which, she is absolutely right, remain a scandal. It is not so much about giving people an extra pound to pay an exorbitant fuel bill but about trying to make sure that their home is properly insulated. She will know, as I do, that in Scandinavia, excess winter deaths are almost unknown, not because it is warmer—it obviously is not—but because people have properly insulated homes. We must make sure that there is more action across government on that issue.

The hon. Member for Manchester Central (Tony Lloyd) raised an important issue, and mentioned the very recent report on hospital care and the management of medicines. His home city is recognised as a World Health Organisation centre of excellence for the way in which it approaches older people—he will be aware of that—and that is something that has come out of cross-government working. He is right that the issue of medicines management in care and nursing homes is important, which is why early last year, the Department of Health agreed to fund a project to improve medicines management in residential care. The project is driven by the sector and led by the national care forum. The goal is to design and test a set of practical tools to help care-home staff, doctors, pharmacists and nurses to provide safer care and reduce the incidence of medication errors and what are known euphemistically as “near misses” in care and nursing homes. The hon. Gentleman is right to raise that issue, which the Government take seriously.

Coming back to the point made by my hon. Friend the Member for Stourbridge about excess winter deaths, she will be aware that in December 2011 the Department of Health published a cold weather plan for England and identified up to £20 million for 2011-12 to support local authorities to reduce levels of deaths and morbidity during cold weather. It is designed so that local government —again, a partnership approach—working with voluntary and community sector partners can address the risk factors of cold weather for vulnerable older people. I accept my hon. Friend’s point that we need to do more work on the issue.

We heard some powerful contributions, including a very moving one from the hon. Member for Bolton West (Julie Hilling). It sounds as though her mother is rather well known. My hon. Friend the Member for Southend West mentioned that he had met her on the Terrace, on an outing to see the flotilla, as I understand it, so she is becoming quite a celebrity. The hon. Lady spoke powerfully about both the excellence and, shall we say, the lack of excellence in the care that her mother had received. There is indeed too much variability in the quality of care. The hon. Lady also talked, rightly, about wrong attitudes to older people, which others mentioned as well. That is something we need to challenge, which we are trying to do in Government.

My hon. Friend the Member for Central Suffolk and North Ipswich mentioned Age UK’s five tests for a Government taking office, and he was generous enough to point to a number of things that the Government have already delivered on and others on which we are trying to make further progress. My hon. Friend the Member for Blackpool North and Cleveleys (Paul Maynard) mentioned that it was important that what happens is not fluffy or soggy. I want to assure him that there is a lot of unfluffy and unsoggy work going on, and to highlight the UK Advisory Forum on Ageing, which was set up just before the last election. It meets quarterly. I attend every meeting. The Minister of State, my hon. Friend the Member for Sutton and Cheam who has responsibility for care services, is a regular attender as well.

We co-chair the forum and it is attended by about 30 representatives of advisory forums for older people from the regions of England, the Welsh Commissioner, the Northern Ireland Commissioner, organisations that are not great fans of the Government, such as the National Pensioners Convention, Age UK and others. We come face to face with these groups once a quarter. I have attended every meeting since the election, and that group sets its own agenda and decides what it wants to talk about. One possible fruit of this debate might be that that work, which has been extremely effective, might be expanded and might bring in other Government Departments more systematically and perhaps other Ministers. That might be a response to some of the concerns that have been expressed.

I should mention that the Home Office is finally—in the sense that these things have been talked about for many years—bringing forward legislation to ban discrimination in goods and services for older people, which is long overdue and very welcome.

I was interested to see that Age UK had commented ahead of our debate. Its position on the proposal for a Cabinet Minister with separate responsibility was, perhaps, more nuanced than we might have expected. Although Age UK obviously welcomed the debate, it said that the appointment of a Minister would not be a panacea, which I do not think anybody suggested. It also suggested that it might create risks as well as opportunities. For example, it says that there is the potential that other Departments might decide that they are no longer responsible for thinking about older people. It says that there is a further potential risk of confusion over the responsibilities of the Minister for older people vis-à-vis those of other Ministers.

I was interested to hear my Labour shadow, the hon. Member for Leicester West (Liz Kendall), say that the important issues all related to care, and that what we need is a Minister in Cabinet responsible for those issues. The Minister of State, my hon. Friend the Member for Sutton and Cheam, who I am pleased has been able to join us at this point in the debate, is doing an excellent job. We do not need two Ministers doing the same job. The hon. Lady said that the issues needed to be discussed at the highest level in Government. I can absolutely give her the assurance that on a regular basis the very issues that she identifies are discussed round the Cabinet table with the principal players of the Government.

[Liz Kendall]

What I said was that, although a Minister for older people would make a big difference, responsibility must lie at the highest levels of Government—with the Prime Minister, the Chancellor and other members of the Cabinet. I am glad that the hon. Gentleman put that on the record.

[Steve Webb]

I am sure the House would expect the Prime Minister to take a very close interest in these matters.

Age UK says that a weak and ineffective post of Minister for older people could do more harm than good. None of my ministerial colleagues are weak or ineffective, so that is not something we need to worry about. It is clear that all Cabinet Ministers, even the Chief Secretary, have a pretty full inbox at present. It was generous of my hon. Friend the Member for Portsmouth North to give him an extra role. I will have a chat to him about it. The worry would be that if an additional role is given to an already stretched Minister, either it becomes marginal and is not done properly, or it ends up being duplicated. That is the challenge for us.

Responding on behalf of the Government to this important debate, I very much welcome the terms in which the whole debate has been conducted. We are united in the view that older people need a proper voice right at the heart and right at the top of Government. We need to think very hard about how we deliver that.

I welcome the terms of the motion, which proposes that the Government should consider—we certainly should—whether that role would best be done by a Cabinet Minister with additional responsibilities. My proposition is that one response might be for the UK Advisory Forum on Ageing to have a more cross-government role. There are plenty more things we could do, but I stress that there are plenty of cross-government and co-ordinated things already being done. I hope that I have been able to give the House some reassurance on that point.

I can confirm that the Government are very happy to support the motion and look forward to further discussions, because I have a feeling that, if we do not make sure that older people have a proper voice right at the heart and at the top of Government, my hon. Friend the Member for Portsmouth North will not let us hear the last of it.

17:55

[Penny Mordaunt]

I want to thank all Members who have taken part in this afternoon’s debate. I know that the Thursday afternoon shift is a tough one, so their constituents can be in no doubt about the importance they place on the issue or their commitment to improving the lives of older people and the services we provide to them.

The challenges we have discussed are great, but I am very encouraged by the breadth of support across the House and the quality of contributions that have been made this afternoon. I thank the shadow Minister and the Minister for their contributions. There is good work going on in Government and in all sorts of organisations across the country. The Department for Work and Pensions, in particular, is doing some very interesting things and has made great progress. I hope that the Minister will forgive us if we are being greedy, but we want more, and I was pleased to hear about his plans for the future.

My hon. Friend the Member for Southend West (Mr Amess) told us that he has been here before, and I am not so naive as to think that we will have a Minister for older people in post by tomorrow, whether that is a stand-alone post or a role attached to a Cabinet post, but I will be greatly comforted in my disappointment if the Minister takes up the issues we have raised this afternoon, as I am sure he will, and continues to improve cross-government working for the benefit of older people.

Finally, I would like once again to thank Anchor and the Grey Pride campaign for their achievements, especially all those care home residents who signed the petition. The objective was to have a debate in the Chamber, which we have done, but they have also started a debate outside the Chamber and I am sure that good will come of it.

Question put and agreed to.

Resolved,

That this House notes the concerns of the Grey Pride campaign; and calls on the Government to consider appointing a member of the Cabinet to be the Minister for Older People, to give a political voice to the older generation, to oversee the co-ordination of services which affect older people, and to focus on tackling the social and economic challenges of demographic change.

Business without Debate

Thursday 28th June 2012 Commons Chamber

Draft Enhanced Terrorism Prevention and Investigation Measures Bill (Joint Committee)

Thursday 28th June 2012 Commons Chamber

Resolved,

That this House concurs with the Lords Message of 28 May, that it is expedient that a Joint Committee of Lords and Commons be appointed to consider and report on the draft Enhanced Terrorism Prevention and Investigation Measures Bill presented to both Houses on 1 September 2011 (Cm. 8166).

Ordered,

That a Select Committee of six Members be appointed to join with the Committee appointed by the Lords to consider the draft Enhanced Terrorism Prevention and Investigation Measures Bill (Cm. 8166).

That the Committee should report on the draft Bill by 9 November 2012.

That the Committee shall have power—

(i) to send for persons, papers and records;

(ii) to sit notwithstanding any adjournment of the House;

(iii) to report from time to time;

(iv) to appoint specialist advisers;

(v) to adjourn from place to place within the United Kingdom; and

That Mr Bob Ainsworth, Nicola Blackwood, Mike Crockart, Chris Evans, Rebecca Harris and Jesse Norman be members of the Committee.—(Sir George Young.)

Young Offender Institutions (Speech and Language Therapy)

Thursday 28th June 2012 Commons Chamber

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

17:57

[Seema Malhotra (Feltham and Heston) (Lab/Co-op)]

I am grateful to the House for the opportunity to speak today on this important topic and thank many hon. Members for their supportive comments this week and for sharing their own perspectives. I wish to raise several points in my contribution, which I hope the Minister will be able to address. If he cannot answer today, I would be grateful if he would ensure that he writes to me with answers or, if the questions relate to areas that are not his direct responsibility, agrees to forward them to the Minister responsible.

This debate was triggered by my recent visit to Feltham young offender institution and, indeed, my interest in youth justice as a member of the Justice Committee. Speech, language and communications needs have become an increasing area of policy focus. An inability to communicate effectively has a tremendous impact on the ability to learn, hold down a job and have a stable family life. I am pleased that the all-party group on speech and language difficulties, which was convened by my hon. Friend the Member for Swansea West (Geraint Davies), is undertaking an inquiry into the links between SLCN and social disadvantage.

The Marmot review of health inequalities in 2010 identified communications skills as being necessary for school readiness, and a Department for Education research report last year showed a clear association between social disadvantage and SLCN among primary school children. It stated:

“More of the low attainers were boys, more were eligible for free school meals and more had English as an additional language.”

Speech, language and communication needs are characterised by difficulties in understanding complex language, in explaining oneself clearly and logically and in responding appropriately to specific social settings. The Bercow report described those needs as including

“difficulties with fluency, forming sounds and words, formulating sentences, understanding what others say and using language socially.”

[Paul Maynard (Blackpool North and Cleveleys) (Con)]

The hon. Lady mentions the impact of many forms of communication delay. Does she agree that one of the most dangerous forms is when young offenders, upon release, do not understand the terms of their release and are called back to prison because they do not understand what they cannot do, such as cross a road to reach a grandmother, for example? Does she agree also that that is why speech therapy is so important in our young offender institutions—to make sure that individuals understand what is happening to them?

[Seema Malhotra]

I thank the hon. Gentleman for his contribution. He makes an important point about the inability to understand what is going on in the justice system through an inability sometimes to read and, certainly, to understand what is being said. An important part of the argument is that we need better speech and language therapy services in order to reduce reoffending.

Statistics from the Royal College of Speech and Language Therapists show that 10% of school-aged children and 1% of adults in the general UK population have speech, language and communication needs, but that 55% of children in deprived areas are affected by such needs. They suffer from a “word gap” of an estimated 30 million words when compared with children in wealthier households, and that limits their ability to use language to communicate effectively.

It is estimated that more than 60% of young offenders have speech, language and communication needs, and there is evidence of a vicious circle—of deprivation leading to reduced language development, leading in turn to communication difficulties. Children with speech and language difficulties are more likely to become frustrated at school, to play truant and to get involved with crime. Once they are involved, they struggle with the formalities of courts and of police interviews, and they come out worse because of it.

[Nick Smith (Blaenau Gwent) (Lab)]

I, like my hon. Friend, have visited young people with communication disabilities in prison; I did so in Park prison, near Bridgend. Does she agree that it is essential to recognise as early as possible, at the point when young people enter the criminal justice system, whether they have communication difficulties? Does she agree further that the Asset tool should be updated so that needs can be identified without delay and the right help delivered?

[Seema Malhotra]

I thank my hon. Friend for his comment. He makes an important point about early identification within the justice system—particularly if somebody’s needs have been missed earlier in life—in order to help an individual to facilitate the rehabilitation that we hope is possible for them.

There is an important debate about the standards of provision in the education system, and I shall speak about that tomorrow at an excellent training conference on developing oracy and literacy, organised by Hounslow Language Service in my constituency.

My concern in this debate, however, is about the access to speech, language and communication needs assessment and services once young people have reached prison. When I visited Feltham young offenders institution recently, I met a 15-year-old boy who has been receiving speech and language therapy, and learning a few speech exercises had already made him more confident in speaking to his family on the phone—with a clear impact on his personal confidence.

The boy’s vocabulary was like that of a child, but this is not so surprising when we discover that 35% of offenders have speaking and listening skills below national curriculum level 1, equivalent to those of a five-year-old. A further 26% of offenders are estimated to have national curriculum level 2 speaking and language skills, which compare to those of an average seven-year-old.

I also heard the story of a young man who was recently at Feltham. He had a lisp, and when he was three his GP had told his parents that this was because he had a small tongue and nothing could be done. He proceeded to do poorly at school. He was laughed at, including by his own family; his mother would force him to speak when friends came round as a source of entertainment. When in prison, this young man came to accept some speech and language support, and within a matter of weeks he was becoming a more confident speaker, with an almost instant change in attitude to turning his life around. An ability to communicate better has been increasingly associated with reduced violent behaviour of young offenders, and that was indeed the case with this young man.

We know that it works to invest in communication skills and in the training of staff and officers in the justice system. The Royal College of Speech and Language Therapists’ briefing on youth crime of June 2012 quotes statistics from Red Bank secure children’s home in Liverpool. Five out of seven young offenders in one section had challenging behaviour. Staff were involved in physically restraining these young offenders on two to three occasions per day. After communication training and guidance from the speech and language therapist, staff were able to reduce the number of restraints to two per week. The Communication Trust has published in its booklet, “Sentence Trouble”, some useful suggestions about how youth justice professionals can positively interact with young people with speech, language and communication needs. It identifies an awareness and training gap in the youth justice work force, who are much better prepared to deal with mental health issues and substance abuse than with speech and language difficulties.

I am concerned that dealing with the speech, language and communications needs of young offenders is falling through the cracks between the Departments for Education, Health and Justice. It is probable that many young people in prison may not have been there had the education system or health system intervened effectively earlier in their life. In 2010, research with therapists conducted by the royal college in four areas of the country suggested that over 90% of young offenders with communication difficulties had not been known to speech and language therapy services prior to their contact with the criminal justice system. Yet the benefits of these services are clear in improving justice outcomes and reducing reoffending. It is feared that current education and rehabilitation measures in prison require a higher level of language comprehension than many young offenders possess. However, current provision of these services in young offender institutes is limited and patchy. Of the 21 young offender institutes, only Feltham has a full-time speech and language therapist, while four others—Hindley, Wetherby, Polmont and Cornton—provide some support on one to three days a week.

There have been moves to make this case and improve provision in the past. In 2006, Lord Ramsbotham, formerly Her Majesty’s chief inspector of prisons, said in a Lords debate:

“in all the years I have been looking at prisons and the treatment of offenders, I have never found anything so capable of doing so much for so many people at so little cost as the work that speech and language therapists carry out.”—[Official Report, House of Lords, 27 October 2006; Vol. 685, c. 1447.]

The Bercow report recommended that the youth crime action plan and work on young offenders’ health should consider how best to address the communication needs of young people in the criminal justice system, including those in custody. The youth crime action plan of 2008, produced under the previous Government, included recognition of the Bercow review’s recommendations. However, I am not certain whether any action has yet been taken by this Government, nor has the Under- Secretary of State for Justice, the hon. Member for Reigate (Mr Blunt), who is responsible for youth justice, commented on speech and language therapy.

The royal college has called for at least one full-time specialist in every young offender institute. The Prison Reform Trust supports this recommendation, and its report, “No One Knows”, recommended that

“prison healthcare should have ready access to”

learning disability expertise and

“speech and language therapy.”

Arguably, on the current evidence, there is a strong economic case for this. Secure children’s homes and training centres cost about £200,000 a year, while placement in a young offender institute costs £60,000 a year. This, the House may be interested to hear, is twice the cost of a year at Eton, which is £30,981. I thank the Minister for providing these up-to-date figures following my written question last week—excluding the Eton figure, of course, which were obtained from Eton’s website. In comparison, a full-time speech and language therapist employed under NHS “Agenda for Change” band 7 costs £30,460 a year—marginally less than a year at Eton. The funding of speech therapy is surely cost-effective, compassionate and necessary for an effective and intelligent youth justice system.

To conclude, I would be grateful if the Minister updated the House on a number of matters. First, what is the Government’s policy on the provision of speech and language therapy in young offender institutions, and on the call for there to be at least one full-time speech and language therapist at every institution? Secondly, will he clarify which Department is accountable for the provision of speech and language therapy in young offender institutions, and how the Department for Education, the Department of Health and the Ministry of Justice work together on this issue? Thirdly, is it true that Asset, the assessment tool used by police and the justice system, does not include a section that enables staff accurately to identify speech, language and communication needs? Fourthly, what assessment of speech, language and communication needs takes place when a young offender is sentenced to prison? Fifthly, is the existing funding secure and are there plans to increase the provision in young offender institutions? Finally, how do Ministers currently measure and review the effectiveness of such services?

I thank the House for the opportunity to speak on this topic today.

18:10

[The Minister of State, Department of Health (Paul Burstow)]

I congratulate the hon. Member for Feltham and Heston (Seema Malhotra) on securing the debate and on setting out the issues so clearly. I note that, curiously, my noble Friend Lord Addington is debating this matter with Ministers in the other place. It is clearly of importance to parliamentarians in both Houses. The work of the all-party parliamentary group on speech and language difficulties underscores that point.

It is important to recognise that speech, language and communication difficulties are part of a complex and multi-layered range of needs that young people between the ages of 15 and 21 may have, particularly those within our criminal justice system. I understand the concerns about speech and language therapy that the hon. Lady has raised and will try to address them.

There have been a number of studies, mostly small-scale studies, on the prevalence of speech, language and communication needs. They place the prevalence of such needs in custodial settings at anything between 60% and 90%. One recent study found the 60% of young offenders screened on entry to custody had speech, language or communication needs. As has been said, among the general population the figure stands at 1%, although there are regional and local variations.

Much attention has been given to these issues over recent years. The hon. Lady made reference to Mr Speaker’s work on behalf of the last Government. The coalition Government are taking forward a number of the actions in the Bercow review. First, we had the Green Paper on special educational needs and disability, and the follow-up report that was published recently. Secondly, there have been pathfinder pilots to develop unified plans covering health, education and care needs, supported by the use of personal budgets. Thirdly, we have had the review of the early years foundation stage. The Department of Health is working closely with the Department for Education to join up health and care, sorting out one of the oft-stated criticisms of SEN provision for so many years.

I assure the House that speech and language therapy is available to young people, and in particular to those in the custodial estate. Currently, it is commissioned in the custodial estate through primary care trusts. It is meant to be commissioned according to local need. That means that in-house services are provided in some larger young offender institutions—not just in Feltham, but in Wetherby and Hindley. I urge the hon. Lady to look at the provision in those two other institutions.

From next April, the responsibility for commissioning prisoner health will move from primary care trusts, as they are abolished, to the new NHS Commissioning Board. That will help to ensure that people with health needs in custodial settings receive care comparable with that received by those in the wider NHS. Offender health lead commissioners will act for the board and determine the right level of service to be provided to meet the identified needs within the prisoner population. They will work at local level with health and wellbeing boards, children’s services, and police and crime commissioners.

[Nick Smith]

May I press the Minister? How many young people’s custodial settings have speech and language therapists working at them? Do some or all settings have them?

[Paul Burstow]

The hon. Gentleman will have heard me say that there is specific in-house provision at three settings, but there will also be referrals through NHS pathways for speech and language services, meaning that any young person in need of speech and language therapy should have access to it. That is one of the requirements of the commission—its responsibility is commissioning appropriate services to meet identified needs. I shall come to the identification of needs in a moment.

Speech, language and communications needs are just one part of an often complex picture. It is important that we acknowledge that there are complex interactions with, for example, mental health problems, learning disabilities, substance misuse and alcohol problems. Therefore, psychiatry, psychology, community psychiatric nursing, psychotherapy, and occupational and creative therapy can all play a valuable part—a bigger part in some cases—in treating and meeting the needs of young offenders.

The hon. Lady was right to highlight the contribution that speech and language therapies make not just in direct services, but in supporting colleagues in a multi-disciplinary team to ensure they have the necessary skills to provide the right communications support and so on.

Adopting a personalised approach is at the core of that. The hon. Member for Blackpool North and Cleveleys (Paul Maynard) rightly said that we need to ensure that people have the communications skills and understanding both when they are in prison or youth offending services and when they are released. That was an important point.

The hon. Lady spoke powerfully of her visit to Feltham and the conversations she had with the 15-year-old lad about his experience of speech and language therapy—he said it gave him more confidence. That is another reason why such therapy is an important component of the right health interventions to meet identified needs.

The hon. Member for Blaenau Gwent (Nick Smith) said in an intervention that early intervention is relevant as well as the change in commissioning responsibilities. Early intervention is a key part of the Government’s approach. Continuity of care and treatment is key. The average period of detention for a young offender is very short—80 days, often including remand. Custody therefore provides opportunities for health assessment and for identifying problems and needs, after which referrals can be made. It is therefore important that we have systems that allow those follow-ups to take place. It was right that the previous Government decided that the commissioning of prison health services should be an NHS responsibility, enabling those systems to be properly joined up, and this Government have maintained that.

We need to look right across the whole criminal justice pathway to provide health interventions that are appropriate to the individual presenting needs. In 2010-11 there were 2,040 10 to 17-year-olds in the secure estate at any one time on average. Sometimes, four times as many were on remand or awaiting sentence to custody, and 85,300 were being supervised by youth offending teams. There is a similar pattern in the 18 to 20 age group.

[Seema Malhotra]

It is important to talk about action across the justice system and recording and assessing, but where will that information be held, so that the records are kept and maintained as a person passes through the justice system?

[Paul Burstow]

That allows me to talk about Asset and what we are dong. Asset is a tool used by the criminal justice system to risk-assess reoffending, whereas we are introducing a comprehensive health assessment tool that incorporates questions on speech, language and communication needs and is designed better to meet the complex range of needs of children and young people in the secure estate. I will send further details about that to the hon. Lady, but in a way the role of the NHS in our prison service is better supported through the second tool and the information systems that support an individual on their journey through the criminal justice system.

We also need to go further back up the criminal justice pathway. The Department is expanding the liaison and diversion services for all ages, and that includes tailored support for children and young people and appropriate referrals for those with speech, language and communications needs. Even further back up the criminal justice pathway is our programme to support troubled families, which tries to break the very cycles that the hon. Lady talked about—of school absenteeism, crime and antisocial behaviour—and which can exacerbate other presenting problems and lead to greater communications difficulties.

In conclusion, this has been an important debate. Speech and language therapy is a highly valued intervention, and the Government recognise the contribution it can make to the quality of life of young people and the potential for reduced reoffending as a consequence. It is clearly necessary that people in the custodial service and in contact with the criminal justice system can be referred and have access to those services. However, speech, language and communications difficulties are just one part of a complex picture of needs, which is why we are ensuring that a more holistic approach is taken that assesses the range of needs that an individual presents when they enter the custodial estate.

As a consequence, we have threaded right through the criminal justice pathway a more personalised mix of treatment and therapy that meets those individual needs. That is our goal. These changes build on the important reform of commissioning, using the strength of a national commissioning board leading on commissioning prisoner health services and working with local partners to make the necessary connections with local services. That is how we will improve the quality of life, care and treatment for young people in our custodial estate. I shall write to the hon. Lady with the details she requested.

Question put and agreed to.

18:22

House adjourned.