Grand Committee
(12 years, 1 month ago)
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Arrangement of Business
(12 years, 1 month ago)
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The Deputy Chairman of Committees (Lord Geddes)
My Lords, it is now 3.30 pm. As is usual on these occasions, I must advise your Lordships that if there is a Division in the House, which I am told is singularly unlikely, the Committee will adjourn for 10 minutes.
Official Secrets Act 1989 (Prescription) (Amendment) Order 2012
(12 years, 1 month ago)
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Lord Ahmad of Wimbledon
That the Grand Committee do report to the House that it has considered the Official Secrets Act 1989 (Prescription) (Amendment) Order 2012.
Relevant document: 7th Report from the Joint Committee on Statutory Instruments.
Lord Ahmad of Wimbledon
My Lords, on behalf of my noble friend Lord McNally, I beg to move that the Grand Committee do consider the Official Secrets Act 1989 (Prescription) (Amendment) Order 2012. This order is made under the Official Secrets Act 1989. Under that Act, it is an offence for a Crown servant or government contractor to make a damaging disclosure of any information within particular categories which is or has been in his possession by virtue of his position, unless he has lawful authority to do so. People who are not Crown servants can be treated as such for the purposes of the Act by being designated in an order. They are then subject to the duties and offences relating to the handling and disclosure of information as set out in the Official Secrets Act 1989.
The order does this by amending the Official Secrets Act 1989 (Prescription) Order 1990 by adding the holders of certain offices to Schedule 2. These officeholders are police and crime commissioners and their deputies, the Mayor’s Office for Policing and Crime and its deputy, the Lord Mayor of the City of London and the representative of the Court of Common Council acting in its capacity as the Police Authority for the City of London. Noble Lords will know that the Police Reform and Social Responsibility Act 2011 establishes a directly elected police and crime commissioner for each police area in England and Wales outside London, with the functions of securing the maintenance of an efficient and effective police force and holding the chief constable to account for the exercise of the chief constable’s functions. A commissioner is able to appoint a deputy. The Act also establishes in London the Mayor’s Office for Policing and Crime with identical functions in relation to the Metropolitan Police Service and the Commissioner of Police of the Metropolis. The person who is the Mayor of London occupies the Mayor’s Office for Policing and Crime and may appoint a deputy.
In the City of London, the Common Council has the function of overseeing the City of London police force and its commissioner under the City of London Police Act 1839. The Common Council is headed by the Lord Mayor and is able to discharge its policing functions by means of a police committee. Police and crime commissioners, who will be elected on 15 November 2012, their deputies and the officeholders having similar functions in London, will need to receive and be briefed on police information in the exercise of their functions. This may include information on one or more of the categories protected by the Official Secrets Act 1989. They are particularly likely to be briefed on information which, if disclosed, is likely to result in crime or impede the investigation or prosecution of crime. We also envisage that they will be briefed regularly on security and intelligence material.
The Government are clear that they wish to maintain the operational independence of the chief constable, and that he or she should be responsible to the police and crime commissioner for ensuring the safe and effective maintenance of the Queen’s peace. We therefore envisage that a chief constable may on occasion need to brief a police and crime commissioner on operational matters which may involve the disclosure to the commissioner of sensitive material that has been sourced by the police service and/or the security and intelligence agencies, such as material on counterterrorism. The degree to which the police and crime commissioner is briefed on operational matters and intelligence will be at the operational discretion of the local chief constable in close consultation with the security and intelligence agencies where necessary. The commissioner’s role in democratic accountability and transparency needs to be balanced against the public interest in maintaining community safety and justice. Unauthorised disclosures could lead to risk to the public, damage police operations and impede criminal proceedings.
The Government consulted on how to address these concerns as part of our consideration in introducing police and crime commissioners and have concluded on the basis of responses that, as elected representatives, commissioners should not be vetted in advance. We consulted further and there was a consensus that making these officeholders subject to the duties and offences applying to police officers was a proportionate safeguard. We need to maintain the trust and confidence of the public and, of course, the police service. Bringing the commissioners and other officeholders under the Official Secrets Act 1989 will provide the reassurance that there is a strong deterrent to prevent unauthorised and damaging disclosure of sensitive information. These officeholders will be Crown servants for the purposes of the Official Secrets Act 1989 only, as are Ministers and police officers. That, of course, does not affect the status of commissioners and other officeholders.
The draft order is an appropriate and proportionate safeguard and I hope it will be acceptable to the House.
Lord Beecham
My Lords, the forthcoming elections for police commissioners may not be an official secret but I can vouch for the fact that, so far as most of the electorate are concerned—at any rate, the ones I have been canvassing over the last few weeks—they remain very much a secret. They are not aware that these elections are going to happen; maybe that will change over the next few weeks.
Certainly, so far as the Opposition are concerned, we have no objection to the order. Indeed, it seems sensible to include the bodies and persons cited within the requirements of the Official Secrets Act. Perhaps where the Mayor of London is concerned, the Prime Minister would like to take it even further, but that of course is not a matter for debate today. However, there is possibly an issue around vetting. In the consultation document reference was made to the issue of vetting. The response to the consultation was published as long ago as December 2010. I have to say that it was not very accessible from the site mentioned in the Explanatory Memorandum today, so perhaps official secrets have overtaken that too, but I was able to obtain a copy from the Library. In it, the Government said that:
“A few respondents identified a need to apply to”,
police commissioners,
“at least the same level of vetting checks applied to police officers”.
That is not an entirely candid description of the response, as in fairness the Explanatory Memorandum points out that,
“the Association of Chief Police Officers, Association of Police Authorities, Association of Police Authority Chief Executives, the Superintendants’ Association and the Police Federation all raised concerns with regards to vetting of the proposed Police and Crime Commissioners”.
Those are not just five individuals. The implication of the response to the consultation might have led one to believe that a handful of people had expressed concern about vetting, but these are serious organisations.
Without wishing to prejudge the argument, and noting the position that the Government have now reached on this, will the Minister at least keep matters under review? Could he assure us that if it is decided at some point that vetting at some level might be required in either a particular instance or more generally, there would be the capacity to institute it without further recourse to legislation? Police and crime commissioners will not just be dealing with matters affecting their own force—of course, some of them in themselves may constitute crimes or suspected crimes within the ambit of national security and the like, and hence be covered by the Official Secrets Act—but potentially they could also be involved in matters that require a national response, which by implication are very likely to include matters to which the Official Secrets Act would apply. In those circumstances and given the potential risks—remote risks, I hope, but they arise nevertheless in areas where the magnitude of a failure might have significant consequences—it might be helpful for a chief constable to have the assurance that, if necessary and if he or she has doubts about the matter, a vetting procedure might be entered into. It may not be the case that government Ministers are thoroughly vetted, but I understand that some procedure applies even to them. It would be strange if there were not the possibility, at any rate, of inquiring further into the elected police and crime commissioner should the occasion arise, even if it is not deemed appropriate to make it a matter of course on their election.
Having said that, we do not object to the order and we look forward to hearing the Government’s response to these points.
Lord Ahmad of Wimbledon
My Lords, I thank the noble Lord for his support for this order. On his concerns about the elections that are arriving on our doorstep on 15 November, at least for those outside London, of course there is a concern about low voter turnout, just as there would be in any election. It is incumbent on noble Lords and indeed on anyone involved in the political make-up of our country to ensure that we have an effective turnout across the country for these most important elections. I know that all sides will support me on that.
The noble Lord also raised a minor point about access to the particular sites, and the fact that it was not as easy as it perhaps should have been. I shall certainly be taking that up with the department. On his final point about vetting, what has been put forward we believe to be a proportionate response, but as with most things, we will keep this procedure under review and, if deemed necessary, we will look at it again. For now, however, what has been put forward is appropriate and proportionate.
Finally, I have just been updated. As I am sure that the noble Lord is aware, even certain Ministers, including the Home Secretary, have not been vetted; nor has the Prime Minister. However, they are subject to the Official Secrets Act, as are Ministers. Coming back to the issue of vetting policy in general, as I said, we will keep it under review. It is very much a matter for the Cabinet Office. If required, I shall certainly write to the noble Lord on this.
Lord Beecham
I am grateful to the noble Lord. For the avoidance of doubt, I certainly join with him in encouraging people to vote. I do not share the views of the noble Lord, Lord Blair, on this matter. Although I opposed and continue to oppose the concept, now that we have them there certainly ought to be as large a turnout as possible in the election. If there is to be consideration—hopefully the situation might not arise—would that require further legislation of either a primary or secondary kind to institute a procedure, or would it be the decision of a Minister, presumably the Home Secretary? I would assume the latter, but it would be as well to have it on the record.
Lord Ahmad of Wimbledon
I thank the noble Lord for his question. I do not believe that there will be a need for further legislation.
Forestry Commissioners (Climate Change Functions) (Scotland) (Consequential Modifications) Order 2012
(12 years, 1 month ago)
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Lord Wallace of Tankerness
That the Grand Committee do report to the House that it has considered the Forestry Commissioners (Climate Change Functions) (Scotland) (Consequential Modifications) Order 2012.
Relevant document: 7th Report from the Joint Committee on Statutory Instruments.
The Advocate-General for Scotland (Lord Wallace of Tankerness)
My Lords, I will provide the Committee with a brief summary of what this order seeks to achieve. It is made under Section 104 of the Scotland Act 1998, which allows for “necessary or expedient” changes to UK legislation in consequence of an Act of the Scottish Parliament and subordinate legislation. This order is made in consequence of the Forestry Commissioners (Climate Change Functions) (Scotland) Order 2012, made by Scottish Ministers under Section 59 of the Climate Change (Scotland) Act 2009. For convenience, I shall refer to this as the Section 59 order.
Scottish Ministers are keen to make full use of the national forest estate in Scotland for generating renewable energy. The national forest estate is land owned by the Scottish Government and put at the disposal of the Forestry Commission. While the commissioners have powers to enter into joint ventures in Scotland for the purpose of exercising their functions under the Forestry Act 1967, these functions do not expressly include the development of the renewable potential of the land put at their disposal by Scottish Ministers.
Section 59 of the Climate Change (Scotland) Act 2009 enables Scottish Ministers to modify the functions of the forestry commissioners in or as regards Scotland where this is necessary or expedient in order to comply with their duties as regards emissions reductions or otherwise in relation to climate change. The Section 59 order amends the 1967 Act to place upon the forestry commissioners a new general duty to use land placed at their disposal by Scottish Ministers in the way best calculated to contribute to the delivery of the targets set under Part 1 of the Climate Change (Scotland) Act 2009.
However, the Section 59 order does not itself enable the forestry commissioners to use the National Forest Estate to generate electricity. The Scottish Government have indicated that because the forestry commissioners will have a duty to use land to contribute to the delivery of climate change targets, it would be expedient in consequence of this new duty for the commissioners to be able to use the national forest estate for renewable energy purposes.
This Section 104 order will modify the forestry commissioners’ functions under the 1967 Act in order to confer express powers on the commissioners to use the national forest estate for the purposes of generating and supplying electricity from renewable energy projects, thus developing the renewable energy potential of the land put at their disposal by Scottish Ministers. Of course, the generating and supplying of electricity from renewable energy projects is a reserved matter, hence the need for this order.
I can assure your Lordships that this Section 104 order will not affect the requirements under the Electricity Act 1989 with regard to consents. It will not exempt the forestry commissioners from the requirements of Part 1 of that Act.
This order is necessary or expedient in consequence of the Forestry Commissioners (Climate Change Functions) (Scotland) Order 2012 and demonstrates the Government’s continued commitment to working with the Scottish Government to make the devolution settlement work. I hope the Committee will agree that this order is a sensible use of the powers in the Scotland Act, and that the practical outcome is something to be welcomed.
I commend the order to the Committee. I beg to move.
Lord McAvoy
My Lords, I thank the noble and learned Lord the Minister, who, as usual, has made his staff available for any advice and/or assistance. I have a slight regret about the noble and learned Lord’s ever so polite attitude because, being used to another place, I sometimes like a wee bit of aggression but I am still waiting for the Minister to show that quality.
Turning to the legislative context, where in Scotland did the push for this come from? Although I do not stay near a lot of forest, nevertheless it is quite a big issue in some parts of Scotland. Why was this initiative taken, and what was the background to it? The policy background mentions wind farms. That is not an uncontroversial issue. I was wondering how that came about.
I have always tended to suspect the reporting of consultations because it is usually in the eye of the beholder, who wants a particular result. What is the current position on the consultation? Is it completely finished or are there still ramifications because people are making complaints or expressing their support? Is it still an issue? In addition, it is stated that a number of the concerns that were expressed have been addressed. Does the Minister know the specific issues that were identified and then responded to? Can he give an indication of how the consultation was handled? Was it just an exercise from on high or was there a definite consultation?
Paragraph 10 of the Explanatory Memorandum is headed “Impact” and states:
“This instrument has no impact of a regulatory nature”,
and goes on to say that the,
“impact on the public sector is insignificant”.
The one thing missing from that is public opinion. If it was insignificant, that is fine, but if there was a reaction, it would be a crucial factor. I would like to know if there were any expressions of public opinion. Is that the reason why a full impact assessment was not produced?
Although paragraph 12 states that the:
“Forestry Commission Scotland publishes an Annual Report and Accounts which is laid before the Scottish Parliament”,
is that the scope of the accountability? I know about devolution, but is there any further scope for the Westminster Government to be consulted? In short, is the whole issue of accountability now devolved to the Scottish Parliament? Obviously this is a comparatively minor arrangement, but never the less it is right to ask questions here in your Lordships’ Chamber and thus subject the order to a bit of gentle scrutiny.
The Earl of Mar and Kellie
My Lords, speaking as a backwoodsman, I approve of giving explicit powers to one of the largest landowners in Scotland and thereby removing all the Forestry Commission land from the renewables area. I certainly approve of the widening of the geographic scope for renewables, especially as it takes the pressure off other areas that may be more beautiful and which are worth retaining in that context. The order considerably widens the already broad remit of the Forestry Commission, which is now far wider than its remit in 1919, which was to produce timber. The commission will now get involved with leisure, recreation, health, landscape management, footpaths, cycle paths, biodiversity, wood fuel and still, indeed, the production of timber. I support all forms of renewable energy, and especially hydro. I am pleased to see that two hydro schemes have already been identified. I would encourage the commissioners to have another look at small-scale hydro projects on the hill burns. I also suspect that they are bound to put up some wind turbines, or allow a partner to put them up.
My final point is particularly related to that. Once a site has been established, it is grid-connected pretty much for all time. It is hoped that the generating technology may well improve and something other than wind farms will come to take their place. The important point is that the sites themselves are grid-connected.
The Deputy Chairman of Committees (Lord Geddes)
My Lords, there is a problem with the sound system. The Grand Committee will adjourn.
The Deputy Chairman of Committees
My Lords, it is now 7.05 pm—oh! Let us try that again; it seems like an eon. It is 4.05 pm. Perhaps now peace and quiet has been resumed, the Minister would also resume.
Lord Wallace of Tankerness
My Lords, I thank my noble friend Lord Mar and Kellie and the noble Lord, Lord McAvoy, for their contributions to this debate and for their general welcome for the proposals. The noble Lord, Lord McAvoy, asked from where the impetus for this had come. The origins go back to the Climate Change (Scotland) Act 2009, which in its generality was setting targets for carbon emissions and the amount of electricity that can be generated from non-fossil fuel renewable sources. The Scottish Government were very keen to make full use of the renewable potential of the estate, which is operated by the forestry commissioners. Indeed my noble friend Lord Mar and Kellie remarked that widening the geographical scope of renewable energy production perhaps takes the pressure off other parts of the country, bearing in mind that the Forestry Commission’s estate is almost 10 per cent of the Scottish land area.
My noble friend asked if there were any further potential hydro locations. I am advised that the commission is taking a proactive approach with developers and communities to identify further locations. I think it is important to emphasise the fact that this embraces electricity generation by means of hydropower. It is not solely wind power. The forestry commissioners, however, made it clear that they do not intend to go down the route of biomass, because that could lead to a conflict of interest with their role as timber suppliers. My noble friend expressed the view that it was vital that sites should be connected to the national grid. I can confirm that proposals would only go ahead if there were grid connections.
The noble Lord, Lord McAvoy, asked about the position with regard to consultation. The consultation took place in relation to the 2009 legislation. It took place ahead of that, although part of the consultation specifically related to the role of the forestry commissioners. The consultation document explained that the provision would facilitate the development of renewable energy potential of the land in Scotland put at the disposal of the forestry commissioners by Scottish Ministers. There were 368 responses to the specific question:
“What are your views on allowing the Forestry Commissioners to enter into joint ventures, with the intention of participating in renewable energy programmes on national forest estate?”.
Seventy per cent of respondents expressed positive views on the option, although a number added caveats; 15% expressed negative views; and the remainder appeared to be neutral or undecided. The noble Lord, Lord McAvoy, asked about some of these concerns and whether indeed they had been taken into account. I can confirm that, yes, there were concerns that related to a possible conflict between the regulatory activities of the Forestry Commission Scotland in respect of renewable developments. As a consequence, a forest renewables unit has been set up; it separates the operation of the development role of the commission from its regulatory role.
The noble Lord, Lord McAvoy, also asked why no impact assessment had been prepared for the order. The position is that orders made under the Scotland Act are required to be laid in draft if, among other things, they vary the legislative competence of the Scottish Parliament, executive competence of Scottish Ministers or make changes to reserve UK primary legislation in consequences of Acts of the Scottish Parliament. Usually such orders do not in themselves have a direct or indirect impact, whether in benefit or cost on businesses, charities or the voluntary sector. They would therefore not normally have any regulatory impact. On this occasion, a full impact assessment was not produced as this instrument simply allows the forestry commissioners to enter into voluntary joint ventures with commercial partners should they wish. It does not impose on private sector or civil society organisations.
I conclude on the point made by the noble Lord, Lord McAvoy, that wind developments tend to be controversial. I reiterate what I said in my opening remarks, that any specific proposal that is brought forward will be subject, if it is 50 megawatts or over, to the regime under Section 36 of the Electricity Act 1989. If it is lower than 50 megawatts, it will be subject to the planning regime. Therefore this order does not in any way detract from the planning arrangements that are already in place.
Cyprus
(12 years, 1 month ago)
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Lord Sharkey
To ask Her Majesty’s Government what is their current assessment of the prospects for the reunification of Cyprus.
The Deputy Chairman of Committees (Lord Geddes)
My Lords, before the clerk calls the noble Lord, Lord Sharkey, I remind Members of the Committee that this is a one-hour debate and contributions from Back-Benchers are therefore limited to three minutes. Hopefully, the Clock will be working. The last time I chaired Grand Committee it was not, and we all had to add up on our fingers and toes. I think that today it is working.
Lord Sharkey
My Lords, I start today’s debate by congratulating my noble friend Lady Hussein-Ece on the recent award by Coventry University of an honorary doctorate, partly in recognition of her contribution to the Cyprus peace process. I also thank the House of Lords Library for its very helpful and comprehensive briefing pack. It is clear from even a quick scan of this document that the prospects for the reunification of the island can seem quite remote and the issues involved quite intractable.
The current dispute is now over 40 years old. Over those 40 years there have been many serious attempts by people of good will from both sides of the island and from outside organisations to bring about a resolution. All those attempts have failed and all had one very significant factor in common—they all used, as you might expect, the political machinery of the island as the primary, if not the sole, mechanism for negotiation. Perhaps repeated failure of essentially the same process, albeit with different actors, should come as no surprise. However, at some point those involved have to address the obvious question of whether it really makes sense to do the same thing over and over again and expect something different to happen.
It is fairly easy to see why the prospects for success may now seem remote. Earlier this year, the UN admitted that talks were deadlocked and saw no immediate way ahead. The Republic of Cyprus’s assumption of the EU presidency has had an obviously chilling effect on dialogue. Research conducted in July shows that over 70% of both communities now feel that they should assert their own rights even if it means members of the other community would be negatively affected. The same survey revealed that only 14% of Turkish Cypriots and 39% of Greek Cypriots would prefer a feasible solution now to an optimal solution some time in the future. Perhaps this is not very surprising. As the International Crisis Group pointed out as long ago as 2009, there appears to be a growing younger generation on both sides of the island who have never interacted with each other and see no reason to do so. They do not have a stake in the property issue and may not wish to face the uncertainties and potential problems that a settlement neither side likes, but accepts, would create. There are additional factors that give weight to the ICG’s comments. The economies of both the north and the south are fragile and both rely on external support, but the intrinsic wealth and prospects of the two sides are widely divergent. It would be quite reasonable to see, in the latest failure, the lack of a real desire in the political machines of the north and the south to actually achieve unification.
That is all very complex and distressing, but does it in fact really matter? The two sides are de facto separate states. Does the de jure status actually matter? I believe strongly that it matters very much indeed. It matters to the people of Cyprus, it matters to the people of the eastern Mediterranean, and it matters to Britain. The eastern Mediterranean is now more troubled and unstable than at any time in the last decade. We have a civil war in Syria, enormous tension between Iran and Israel and unresolved situations in Libya and Egypt. Now, added to all that, there are the problems raised by the huge gas finds in Cypriot territorial waters. Exactly who that gas belongs to and in what quantities, how to develop the fields and how to transport the gas, are all questions that, if unresolved, are highly likely to add severely to the political tensions. It would be absurd and tragic if the division of the island effectively prevented any exploitation of those gas fields, yet that is exactly what a senior energy industry executive has predicted to me privately.
But there is a clear positive side to the existence of those fields, quite apart from their potential for the economy of the island. Over the summer, it seems to have given fresh energy to those seeking renegotiation. In September, Alexander Downer said that the Greek and Turkish sides now had a strong economic reason to agree to a reunification that would reduce the sovereign risk of investing in Cyprus, clear up the problems of investing in property, grow GDP and offer the capacity to service and pay off debt. The British Foreign Secretary made the same point when he said recently in Nicosia:
“We have supported the rights of Cyprus to develop resources but I hope that doing so can somehow be an incentive for the settlement of the problem, rather than a disincentive”.
All that is good news. It is a sign that the parties may understand that there is a new and compelling reason to negotiate. However, it does not address the failure of the traditional methods of negotiation. The UN Secretary-General’s report of March this year notes that:
“Civil society also has a crucial role to play in building public confidence in the process. Unfortunately, civil society organizations, and women’s groups in particular, remain outside the framework of the negotiations. I therefore call on the sides to step up their engagement with civil society and women’s groups, with a view to building public confidence in the benefits of a settlement”.
Most involved countries and supranational institutions and many commentators have recognised the force of that. James Ker-Lindsay of the LSE, writing in May this year, concluded that:
“Having comprehensively exhausted the elite focused approach to conflict resolution in Cyprus, it does seem time to radically rethink the ways in which we try to resolve the Cyprus Problem … a truly Cypriot-led process needs to be far more inclusive than has hitherto been the case … the case for involving civil society in any future effort to resolve the Cyprus issue is certainly compelling. After all, everything else has been tried—and failed”.
The Commons Foreign Affairs Committee had this to say on the subject in its report of March this year:
“We … recommend that if this effort fails”—
referring to the then current round of negotiations, which did fail—
“and there is still no settlement on Cyprus once Cyprus’s period as President of the EU Council is completed … the Government should consider whether any alternative approach to the Cyprus situation, by itself and the international community, might be more likely than previous efforts to yield a settlement”.
Fortunately, some organisations have believed in that approach for some years and have made substantial funds available to help encourage the development and inclusion of civil society. That financial help is absolutely critical. As INTRAC noted last year in its extensive briefing paper on the subject, key challenges are sustainability and funding, staffing and maintaining CSO networks. Funding is absolutely the key issue. If we believe that the involvement of civil society can advance reunification, then money needs to be found. In 2009, the EEA awarded €1.5 million in grants to civil society projects in Cyprus. In June this year the EU approved funding of €26.5 million to the Turkish community with the goal of promoting confidence-building and reconciliation between the two parts of the divided island. Beneficiaries of the new funding will include civil society organisations.
But what is Britain’s contribution to the encouragement of civil society in Cyprus? On 11 June this year in a Written Question, I asked Her Majesty’s Government,
“which bi-zonal or bi-communal civil society organisations or projects in Cyprus they currently support”.
This was the Answer:
“We welcome bi-communal work in Cyprus, which is an important way of preparing the ground ahead of a settlement by building trust between the two communities. The UK supports directly the Committee on Missing Persons through both financial donations and by providing its accommodation. In the past 24 months, our High Commission has hosted the Stelios award for successful bi-communal businesses”.—[Official Report, 11/6/12; col. WA 156.]
That does not seem to be a lot and it does not seem to take civil society very seriously. It does not measure up to our history or our obligations in Cyprus. I hope very much that today the Minister will tell us about a much greater effort and much greater funding. After all, a lot is at stake here. I look forward to hearing the contributions of all noble Lords on this matter.
Baroness Knight of Collingtree
My Lords, I declare an interest as the current chairman of the all-party group for Northern Cyprus. I congratulate my noble friend Lord Sharkey for securing this brief debate. For years, Northern Cyprus has been treated unfairly, and even spitefully, by Greek Cypriots. Considering that Britain is a guarantor, I believe that we have failed in our duty to the north to get things right. These people really do not deserve to bear the suffering and hardship that is inflicted on them—and many of us have seen it for ourselves.
In my three minutes, I shall deal with the case of Meliz Redif, a Turkish Cypriot athlete who sought to compete in the Olympics. She had every right to do so, but she was not allowed to unless she changed her nationality, lied, denied her own country and claimed to be from Turkey. The Olympic charter specifically states that taking part is a human right without discrimination of any kind. I cannot believe that Britain, as a guarantor, can stand by while people whose only fault is that they live in the wrong part of Cyprus are treated in this way. It seems that only the reunification of the island will end this suffering. I long to hear that my own Government fully appreciate and understand the unfairness and suffering that is going on, and will seek again to end it.
Lord Harrison
My Lords, the European Union was recently awarded the Nobel Peace Prize and I hope that the Minister, the noble Baroness, Lady Warsi, will congratulate the European Union on achieving the aim of providing peace in Europe over the past 60 to 70 years. But one big failure has been the inclusion of Cyprus in the Union when peace has not been secured on the island. My sympathy for Northern Cyprus was increased when I learnt that it had agreed to the Annan plan but southern Cyprus had not. I can assure the Minister that the European Union Select Committee, which is currently writing a report on enlargement, will ensure that never again will anyone come into the European Union represented by a divided nation.
I have had the benefit of twice visiting Turkish Northern Cyprus. At the moment, the EU presidency is held by southern Cyprus. A missed opportunity there was the chance for the two sides to work together both informally and formally to welcome the other countries of Europe. Can the Minister say what help the United Kingdom has given to the presidency—it is the first presidency to be held by Cyprus—in these very difficult times? I hope that we have given administrative help and advice. Perhaps I can press her to take other opportunities after the six-month presidency expires to try to deal with some of the other outstanding problems, not the least of which is that we are still not allowed to operate direct flights from the United Kingdom to Northern Cyprus. Under the Bologna process the vibrant universities of Northern Cyprus are still excluded from exchanging and learning from other universities around the whole of the European Union.
Like the noble Lord, Lord Sharkey, I have seen NGOs, civil society and particularly the business community come together on the island of Cyprus. These could use opportunities such as gas exploration to help revive the island of Cyprus, which is experiencing some real financial problems on both sides of the dividing line.
If it is the case, as we have learned, that Turkey is now Greece’s number two trading partner—if their two presences are beginning to come together in the economic sphere—it should also be the case for Northern Cyprus. Will the Government make a new initiative to help out and resolve this issue?
Baroness Hussein-Ece
My Lords, I declare an interest as the secretary of the All-Party Parliamentary Group on Cyprus. I thank my noble friend Lord Sharkey for securing this debate. I have spoken many times over many hours on Cyprus, but I have never had to do it in three minutes, so I hope that I will get in the key points I wanted to raise today.
As has been mentioned, the UN peacekeeping forces have been in Cyprus since 1964—48 years later they are still there. The problems did not start in 1974, as we so often hear, and like so many others of a Cypriot heritage—in my case, Turkish-Cypriot—my family have been directly affected by decades of unrest, conflict and loss. All Greek and Turkish Cypriots have suffered. There are victims on all sides.
Following the failure of the biggest opportunity, the 2004 Annan peace plan, and the ensuing failed referendum, many of us were hugely disappointed when Greek Cypriots voted overwhelmingly no and Turkish Cypriots voted emphatically yes. This no vote cemented the status quo. In 2004 a categorical promise was given to Turkish Cypriots by the EU to lift and alleviate isolation. What representations have the UK Government made to honour these promises?
The recent efforts of the United Nations towards Cypriot-led talks have failed and I believe they have retrenched divisions. Both the UK and, in my view, the EU have hidden behind the United Nations and are in danger of contracting out any responsibility to help and support new ways towards a solution. Disappointingly, lobbying by some here in the UK has become a campaign to preserve the status quo. I must stress that the groups doing this are a minority, but a vocal minority, adept at lobbying parliamentarians who often lack background knowledge and experience of Cyprus, and simply listen to the loudest voices and form their views after a few days visiting some parts of the island. This is not helpful, and only seeks to polarise opinion and reinforce divisions.
I believe that the United Kingdom, as one of the guarantor powers, has a responsibility to be more proactive and an honest broker. Neither Greek nor Turkish Cypriots can fulfil their potential on an island whose future is so unequal, divided, uncertain, militarised and facing new economic difficulties—and, as we have heard from the noble Lord, Lord Harrison, educational difficulties as well. Are we really saying that Turkish Cypriots should be denied recognised qualifications until there is a peace plan at some point? I do not think so.
I believe strongly in the need to unblock the situation on the island and engage civil society, as so eloquently mentioned by my noble friend Lord Sharkey. Both Greek and Turkish-Cypriot NGOs argue that by focusing solely on the talks at the leadership level, we are losing out on real opportunities. The UN formula of two men—and I am afraid that it is always men—locked in a room, disengaged from their respective communities, until they agree on all points, has not worked.
In the north, there is a new civil society movement, spearheaded by Dr Kudret Özersay, the former UN chief negotiator, called Toparlaniyoruz, which in Turkish roughly means, “We are pulling ourselves together” or “We are getting our act together”. I call on the Government here to get their act together a bit more and support NGOs, civil society and organisations working on the ground to bring far more peace, equality and dialogue. If you ask any Greek or Turkish Cypriots, here in London or in Cyprus, about the peace process, the response is likely to be the same: complete apathy and resignation. Can we please see efforts from Her Majesty’s Government and the EU to change this?
Lord Kilclooney
My Lords, this debate, introduced by the noble Lord, Lord Sharkey, asks the Government what their current assessment is of the prospects for the reunification of Cyprus. I am sorry to say that my opinion is that they are nil and I shall explain why. I have been to Cyprus for every one of the past 50 years and I am also a regular attendee of the Anglican church in Kyrenia. I well remember 1975, after the coup d’état, when the collection plate went around in the church and we were told, “British pounds or Greek Cypriot pounds but no Turkish lira”. Unfortunately, that was the attitude at that time.
In 1963, the Turkish Cypriots were driven out of the partnership state of Cyprus. In 1974, there was a coup d’etat by the Athens-inspired Government, bringing in the former EOKA leader, Sampson, as the president. In 1975, I was there when, only a few months later, the Turkish Federated State of Cyprus was created, which subsequently in 1983 became the Turkish Republic of Northern Cyprus. We are now celebrating the 29th anniversary of peace since the TRNC was created.
In 2004, a peace agreement was proposed by the United Nations. The Turkish Cypriots voted for it, but the Greek Cypriots rejected the peace agreement. What was their reward? The European Union immediately appointed the Greek Cypriots as a member state, which was a disastrous decision yet again by the EU. It was not the first one it has made but this was a very bad decision. It means that the Greek Cypriots no longer have any incentive whatever to reach agreement within the island of Cyprus.
There are three jurisdictions in Cyprus: the Greek Cypriot jurisdiction, known as the Cyprus Government; the Turkish Republic of Northern Cyprus; and, of course, there are United Kingdom sovereign bases. Therefore, we must have talks. As one who took part in the Belfast agreement settlement, I know the importance of talks. But those talks must not be under the auspices of the European Union in any way. It is biased in every respect: Greece is a member, Greek Cyprus is a member and there is a background of accepting Greek Cyprus even though it voted against the Annan agreement.
What is the way forward? We can have unity with Turkey; we can have independence for the Turkish Republic of Northern Cyprus; or we can have a bizonal agreement. Unity with Turkey is already taking place—they have the same religion, the same currency and free trade. Unity is on its way. I do not think that that is the answer and we have to try to do something to stop it. I find independence of the TRNC diplomatically impossible to accept.
Lord Kilclooney
You do not want to hear any more. I have some questions for the Government. First, will they investigate how Cyprus, as present president of the European Council, employing 700 people in Brussels, employs only one Turkish Cypriot? Is that fair play? Let us hear the answer to that. Why has that not been raised by the United Kingdom Government? Secondly, why does our sovereign base in southern Cyprus, in Akrotiri, refuse to issue any statements or contact the press in the Turkish Republic of Northern Cyprus?
The Lord Bishop of Guildford
My Lords, I declare an interest as a vice-president of the Conference of European Churches, of which the autocephalous Orthodox Church of Cyprus is a member.
First, I will offer a personal reminiscence. Way back during the summer of 1974, I was preparing myself to take up a post at Lambeth Palace in the then international affairs department. The breaking news of course that summer was the Turkish invasion of Cyprus in response to the provocative tactics, already mentioned, of the Greek-speaking south, instigated by Athens. There the division of Cyprus seems to have remained. I am not unaware of the significant local and international attempts at reconciliation, which we have heard, and we know, have had no success so far.
The points I want to make are simple. First, before the intervention and its provocation, there were many villages and communities where there was a well documented positive relationship between the local communities. The partition and then the movement of populations have made that much more difficult and, indeed, in most places locally impossible. Yet there were places where the two religious communities, Greek Orthodox and Muslim, in part shared, in a local way, each other’s local feasts and festivals. Some restoration of this local community respect and mutual celebration needs to be considered, alongside political initiatives. That is very much alongside what the noble Lord, Lord Sharkey, said in terms of civil society.
The second point is about the UN and the Green Line. The softening of the Green Line in part in latter years is, of course, welcome—it is easy for tourists. This needs to be further encouraged in terms of the ability of the local communities. Some time ago, I spent some time on the Green Line with the British Army chaplains seconded to the UN force. I could go across either side at will because I have a UN pass and privilege to do that. The local communities need to be enabled to do that again too.
Thirdly and finally, in Turkey there are reasonable and constructive religious relations and dialogue, at least at the level of the Ecumenical Patriarch and the Muslim leaders in Istanbul and elsewhere. Obviously that does not apply to more extreme groups, but there are external ecumenical bodies, such as the Conference of European Churches and the World Council of Churches that might in part, alongside a reengagement of civil society, be constructive instruments of reconciliation. In a taxi on the way here this afternoon, I noticed an advertisement for North Cyprus as a unique Mediterranean experience—“beautiful North Cyprus”. I encourage everybody and Her Majesty’s Government to do all we possibly can to make that experience even more beautiful in terms of the reconciliation of communities, in spite of all the international road blocks so far.
Lord Northbrook
My Lords, as a relative newcomer to the Cyprus question and as a member of the all-party Northern Cyprus group, I have listened to many experts speaking in that group and here today. The recent Congressional Research Service paper entitled, optimistically, Cyprus: Reunification Proving Elusive, reiterates that roughly 18% of the population are of Turkish origin, so any settlement must take fair account of this representation. The Treaty of Guarantee of 1960 promised the Turkish population security, which was in danger of being breached by a more hard-line president in Greece, who was encouraging union of the island with Greece. Hence, there was the need for Turkey to invade in 1974 to protect their minority on the island.
I can understand more clearly the history of negotiations since the 2002 Annan plan. The best chances of reunification appeared to be the Christofias-Talat negotiations between 2008 and 2010. However, since Mr Eroglu came to power, relations between the two sides seem to have become much more difficult. President Christofias comes out with little credit and it remains to be seen what the attitude of his successor will be after the election in 2013.
With regards to the issues, the paper makes clear why negotiations have been so difficult. First, there is the very basic issue of how a new united Cyprus would be created. The Greek Cypriots assume it would be evolved from the existing Republic of Cyprus. The Turkish Cypriot view, which I have much more sympathy for, is that the new state would be based on two equal founding states. Mr Eroglu has hinted that he is not prepared to give up the Turkish Republic of Northern Cyprus or its flag. Disagreement has also continued over the process for appointing the president and vice-president.
The next very difficult area is the thorny issue of property. Since 1974, it is estimated that over 150,000 Greek Cypriots living in the north have been forced south, and close to 50,000 Turkish Cypriots living in the south have fled to the north, with both communities leaving massive amounts of vacated property. The establishment of the Immovable Property Commission—the IPC—to hear cases related to Greek Cypriot property in the north was a positive step. It is interesting to note that a few private Greek property owners have filed claims for compensation. As in past negotiations, the gap in the respective Cypriot positions had been great and appears to remain so.
Then there is the by no means small issue of overall territory that would come under the jurisdiction of the two equal states. The Turkish Cypriot side of the Green Line includes approximately 37% of the island and includes several areas that had been almost 100% Greek Cypriot-inhabited before the 1974 division. Greek Cypriots want that territory returned, which would leave the Turkish Cypriot side controlling about 29% of the territory. Next to the property issue, the issue of security guarantees continues to be one of the most difficult bridges to cross. At the end of all this, I feel that the only way forward will be to involve civil society more, but I fear that formalised partition may be a possibility.
Lord Anderson of Swansea
My Lords, the recent reports contained in the helpful Library pack make gloomy reading for those of us who strongly favour the reunification of this beautiful island. The Congressional Research Service report ended by asking whether unification can be achieved at all, with the increasing possibility of a permanent separation; a view shared, for example, by Jack Straw. Historians may look back and see the events of 2004, 2008 and 2010, with the good relationship between President Christofias and Mr Talat, as failed opportunities, leading possibly to an ultimate separation.
Does the Minister see any signs of hope in the current position, for example on the apportionment of resources from the recently discovered gas fields? On demography, is it her understanding that many—some say up to 50,000—Turkish settlers have returned to the booming economy of the mainland? Will the election in February 2013 of Mr Anastasiadis of DISY, who voted yes in the referendum, have a positive effect? Does the Minister agree that the key to any possible settlement still lies in Ankara, which, after the EU dimension, has less incentive to press for an agreement?
Surely the grim reality is that there seems to be insufficient political will to make progress. There is currently a sense of drift, with both sides, particularly the younger generation, becoming used to the status quo of a divided island. The lack of confidence has been increased by recent border provocations. In classical Greek drama, when there was no clear ending, a “deus ex machina” was brought on to the stage. Alas, there appear to be none on the horizon, save, perhaps, the greater involvement of civil society as mentioned by the noble Lord, Lord Sharkey. The beautiful island of Aphrodite slides towards greater separation all because of a lack of trust on both sides and a continued failure to make progress on the core issues such as property and territory. Can the Minister cheer us by signalling any windows of opportunity?
Baroness Scott of Needham Market
My Lords, in 2014 it will be 50 years since United Nations troops started peacekeeping in Cyprus. Despite their best efforts, not only has there been a lack of progress but resolution is further away than it has ever been, as public attitudes harden and the economic disparities increase. The international view is that this is entirely a matter for Cyprus. Indeed, the main victims of this failure of political leadership are the Cypriot people. We owe it to them to think about whether it is time to approach this differently. There is also a much wider set of strategic issues that make progress imperative. There is the whole question of Turkey’s membership of the EU and what that means for where Turkey sees its future alliances, and the growing instability in the eastern Mediterranean and how Cyprus plays into that, particularly since the discovery of offshore gas.
Of course, the solution cannot be forced on anyone and nor can you make people undertake fruitful negotiations. However, I believe it is possible to change some facts on the ground, and here are a few possible thoughts. There is currently a proposal to expand the port of Limassol and no doubt an EU grant will be sought to do the work. However, as an alternative, real consideration should be given to developing the port of Famagusta. There is a viable option that would see it operating under the auspices of the European Union and open to all trade. The economic benefits would be significant and it could help unlock the ban on Greek-Cypriot trade using Turkish ports.
Secondly, the EU must turn its attention to meeting the commitment it made to introduce the direct trade regulations that will free up businesses in the north to trade directly with EU countries. The Turkish Cypriot Chamber of Commerce told me two years ago that direct trade would go a long way to bridging the economic gap with the Republic of Cyprus. At the very least, the EU should ensure that barriers are not placed on the transit of goods from north to south under the Green Line regulations.
Thirdly, regional agreement needs to be reached on the development of the offshore gas resources. Currently, the Republic will struggle to develop the fields because of the political uncertainty, and because the cost of liquefying the gas and sending it by sea is unlikely to be economically viable. On the other hand, a gas pipeline through Turkey is a completely different matter. News came from Ankara last week that work has started on a water pipeline from Turkey to Northern Cyprus, to which an electricity pipe will be added. Either the EU or the UN should act as a broker for a deal that develops these new infrastructures for the benefit of the whole island.
Finally, we should build on the work that has been carried out by the UN and EU to build civic society and foster links between the communities. Strengthening these communities, and creating cultural and sporting links on both sides, across the border and internationally, would over time help to change the terms of the debate on the future of Cyprus.
Lord Maginnis of Drumglass
My Lords, I am grateful to the noble Lord, Lord Sharkey, for raising an issue that has preoccupied me for more than 25 years. Rather than repeat what I and others have articulated in support of the human rights of Turkish Cypriots over that period, I want to try, in these few moments available to me, to examine the role and responsibility of the United Kingdom in the context of the 1960 Treaty of Guarantee, where we were, and still are, one of the three guarantor powers.
Sadly, I have observed over my 30 years in Parliament the extent to which successive UK Governments have allowed themselves to delegate authority to the United Nations, to the United States and, worst of all, to the European Union—to an extent where Ministers are no longer in a position to state a government position but merely seek to interpret extraneous influences that are used to excuse their own political impotence.
It is, at the time when we ponder 50 years of BBC moral ineptitude, not inappropriate to remember the not dissimilar behavioural vulnerability the United Kingdom exploited in order to force Archbishop Makarios into an agreement that was never going to work, had no historical precedent and abandoned Turkish Cypriots to a form of ethnic cleansing that was virtually overlooked until we encountered the later events in the Yugoslav or Balkan wars 20 years ago.
Our culpability was that as a guarantor power we abdicated to the United Nations, which, not for the last time, stood by while innocent women and children were slaughtered by terrorists like Nikos Sampson and EOKA-B. Thank God Turkey, albeit 10 years too late, intervened in 1974. That was 38 years ago and our feeble reaction to this period has been to isolate the victims and to embargo their rights to their identity, their travel, their businesses and their educational opportunities. What arrogance and what injustice. Still, after two generations we merely subscribe to an unrealistic United Nations premise, which was contrived in panic in 1963. We seek to perpetuate a failed process—the Annan plan—which was voted down at the 11th hour by Greek Cypriots when, to our shame, we cravenly abandoned every conditional promise that we had made to the Turkish Cypriots who accepted it.
Time beats me but I conclude with this challenge. I ask the Minister to show me a single episode in this sad 50-year tragedy that brings credit to the United Kingdom. Is the Minister aware that this and the previous Government do not even have the courage to turn up on 11 November each year to show respect at the memorial in Girne, Kyrenia, to the 371 of our soldiers who died during the Cyprus emergency between 1956 and 1959? I ask the Minister: when will this Government find adequate time to fully debate the Cyprus issue and contribute positively towards a plan that has some modicum of humanity and circumspection, in contrast to our past ineptitude?
Lord Liddle
My Lords, we should thank the noble Lord, Lord Sharkey, for posing this Question, which allows us to have this debate. Many noble Lords have spoken with great passion about the intractable problems and multiple injustices of the island of Cyprus. The Government should listen hard to what has been said. For my part, the Cyprus issue is a 21st-century equivalent of what Lord Palmerston quipped about the Schleswig-Holstein question: “Only three people understood it; the prince consort who is dead; the German professor who is mad; and me, who has forgotten all about it.”. I am afraid that this issue is of such complexity that that is what it is like.
When Labour was in government and I was in No. 10, we tried to resolve this complexity by sending for the noble Lord, Lord Hannay, who tried to negotiate a deal. Indeed, he made quite a lot of progress and it is a great pity he is not here to bring his wisdom to this debate.
Our options are limited. What happened in 2004 was a tragedy but we were acting under a threat of Greece vetoing the major enlargement of the European Union and one had to make a realpolitik choice in truth about what was the best thing to do, which was very difficult. What can be done now? What does the Minister think that we can do, as Britain, as a guarantor power in trying to promote reconciliation on the island? Given our history, we have a special responsibility and we should exercise it.
More than that, I have always thought that the solution to the Cyprus problem was part of a wider solution to the relations between Greece and Turkey, and the whole situation in the eastern Mediterranean. It is very important that, as committed members of the EU, we are trying to proceed with Turkish membership. That is what will give us quite a lot of leverage in order to get a solution to this problem.
In terms of Greece and Cyprus, and the economic difficulties that Greece is presently in, if things go wrong there, this will make the situation in that part of the world much worse. We have to exercise our best endeavours to make sure that we do not have an economic collapse that leads to a return to extreme nationalism in that part of the world. I fear for the consequences were that to happen. We look forward very much to hearing the reply of the noble Baroness, Lady Warsi, to this excellent debate.
The Senior Minister of State, Department for Communities and Local Government & Foreign and Commonwealth Office (Baroness Warsi)
My Lords, I am grateful for the opportunity to respond for the Government to this debate brought by the noble Lord, Lord Sharkey. I start by endorsing his words of congratulation to my noble friend Lady Hussein-Ece.
The noble Lord, Lord Liddle, quite usefully laid out how the previous Government dealt with some of these challenges, and once again I am reminded of the great experience and expertise in this House on foreign relations and Foreign Office matters. I know that the noble Lord, Lord Liddle, missed me yesterday at Oral Questions, but I am sure that he will agree that campaigning for re-election to the Human Rights Council in Geneva was as important.
Cyprus has been too long divided, as I am sure all Cypriots and friends of Cyprus would agree. The current round of settlement negotiations, under way since September 2008, unfortunately is in hiatus. The United Nations is doing what it can to move the process along in the absence of political-level meetings. It is focusing on the work of the technical committees, trying to make them more productive and focusing on practical co-operation. Alexander Downer, the UN Secretary-General’s special adviser on Cyprus, believes that there has been some success.
The Greek Cypriots continue to express willingness to continue talks, but not constrained by a timeframe. The Turkish Cypriots say that they want to continue talks but wish for a timetable that would include a deadline for a multilateral conference in order to create the environment for give and take, which they say is necessary to address the internal aspects of the negotiations. The leaders of the two communities have not met since March this year and it seems unlikely that any such meeting will take place until after the presidential elections next February.
Her Majesty’s Government continue to take a keen interest in the situation in Cyprus. We are very aware of our role as a guarantor power, but we must not lose sight of the fact that this is a process by Cypriots for Cypriots, and that it is for the leaders of the two communities, whoever they may be, to work constructively together to deliver a new future for Cyprus. We will continue to support this process and to encourage all who have a role to play to seize the opportunity of a new political era to find a solution to this long-running human tragedy.
As a guarantor power, the UK has undertaken by treaty to prohibit,
“any activity aimed at promoting directly or indirectly, either union of Cyprus with any other State or partition of the Island”.
A settlement will bring long-term stability, peace and security for all the people of a united island within the European Union, supporting the prosperity of all Cypriots and ending the isolation of those who live in the north of the island. More widely, it will create an arc of greater stability from the Aegean to the eastern Mediterranean by removing the major impediment to good relations between Cyprus, Turkey and Greece.
Only through a fair and lasting settlement can we ensure that all the people on the island are the beneficiaries of a fair and sustainable future and that the EU acquis can be extended to the whole island. It would deliver significant economic benefits for both communities, opening up greater opportunities for regional trade and investment. Reunification would also provide the space for civil society to flourish and for leaders to look outwards, spending time on the global issues that confront us all, such as climate change and energy security.
Living on a divided island cannot be a situation that any Cypriot would want to continue without a long-term solution. Ordinary citizens cannot move around the island as noble Lords would move around the UK, and this was raised today in the debate. There are checks on persons as they cross the Green Line that divides the two communities, and checks on the movement of goods have an inevitable negative impact on the prosperity of the island as a whole.
The division of the island has resulted in the dislocation of ordinary Cypriot families, and the resulting disputes about the ownership of property continue to impact on people today. Many Cypriots born after 1974 do not know anyone from the other community. Where there is no contact there can be no understanding, and negative stereotypes tend to dominate the image each community has of the other.
My noble friend Lady Hussein-Ece raised some valid points about views on the issue not being fully informed. She always speaks with great passion and expertise and expresses very personally the frustration felt by so many in Cyprus. My noble friend also asked specifically what the UK is doing in relation to alleviating the isolation of Turkish Cypriots. The UK is in contact with many civil society groups in Northern Cyprus. It supports the direct trade regulation blocked in the EU and is working to support a comprehensive settlement as ultimately the most effective way of ending the isolation of Turkish Cypriots.
There are some positive signs and it is important that we do not lose sight of them. Following the dreadful explosion in July last year which killed 12 people and knocked out the main electricity plant in the south, the two communities were able to come to an agreement which saw the north of the island supplementing the electricity supply for the south. This mirrors the arrangements made in 2006 when the Government of Cyprus agreed to supply the north with electricity after an explosion in the main power plant. That type of co-operation and practical assistance shows that it is possible to move forward from the difficulties of the past.
The noble Lord, Lord Anderson of Swansea, referred to the recent gas finds. The UK is optimistic that efforts to achieve a settlement will eventually be successful. The gas finds and the presidential elections next February are a part of this. In this difficult and long-lasting situation, my noble friend Lord Sharkey is absolutely right to say that civil society within and between the two communities has an important role to play in developing the key missing ingredient, that of trust. Civil society can reach out to those beyond the bounds of politics to establish practical working relationships and foster co-operation that will lay down the grounds for a long-term improvement in relations.
Perhaps I may give some real examples of where civil society contacts and initiatives are working. Over the past five years, our high commissioner has worked closely with Sir Stelios Haji-Ioannou’s Stelios Philanthropic Foundation to encourage bicommunal business. It also directly supports the bicommunal Committee on Missing Persons through financial and practical support. This important committee is working on one of the most difficult and distressing aspects of the whole situation, seeking to identify bodies and find resolution for families who do not know what happened to their loved ones. There are also important locally driven initiatives looking at best practice and learning lessons from other long-running, complex intercommunal conflicts, such as those in Northern Ireland and South Africa. Valuable efforts are also being made to bring the two communities together that include school children.
Lord Maginnis of Drumglass
I just want to point out that the Minister is in error when she compares Northern Ireland or South Africa where the language is the same, the people live side by side, and they have not been deliberately divided for almost 50 years.
Baroness Warsi
I take the noble Lord’s point, but there are lessons that can be learnt. The FCO funds a small number of projects to support this.
I agree that more could be done, and I turn to the specific point raised by the right reverend Prelate the Bishop of Guildford on bringing together religious communities in order to foster reconciliation. The UK would support any efforts made to encourage the coming together of the Muslim and Greek Orthodox communities on the island. The right reverend Prelate is aware of the work I support in relation to inter-faith understanding.
My noble friend Lady Knight spoke of the important case of Meliz Redif. Her Majesty’s Government do not recognise the Turkish Republic of Northern Cyprus and so we were unable to make representations to the International Olympic Committee about the inclusion of Northern Cyprus as a participant country in the Olympic Games. Turkish Cypriots are able to compete under the Cypriot flag, but I am afraid that I must presume that that is not the answer my noble friend wished to hear.
The noble Lord, Lord Harrison, asked what help could be offered through the Cypriot presidency of the European Union. The Government have provided support through practical assistance, including the provision of secondees across government. The noble Lord, Lord Kilclooney, raised the issue of the employment of Turkish Cypriots in Brussels. Who is employed has to be a matter for the Republic of Cyprus. However, the British high commission employs staff from both communities.
Lord Kilclooney
I was not talking about the British high commission. I was talking about the so-called Cyprus Government, the Greek Cypriot Administration, which totally discriminates against Turkish Cypriots in Brussels. The United Kingdom is a guarantor power. Are we doing nothing, as a guarantor power, to exercise our powers in respect of fair employment by the Cyprus Government?
Baroness Warsi
The specific question that the noble Lord asked was in relation to employment in Brussels. We, of course, only have a say in relation to the people that we employ at the British high commission. It is therefore important to stress that we employ staff from both communities. The high commission represents—
Lord Kilclooney
Is the Minister saying that the United Kingdom is washing its hands of its position as a guarantor power for Cyprus?
Baroness Warsi
No, my Lords, the British Government are not saying that. I must move on as a number of matters were raised by noble Lords. The noble Lord, Lord Northbrook, raised the issue of the Immovable Property Commission. We support that commission and agree that property is one of the key and most complex areas for any final settlement.
My noble friend Lady Scott raised the issue of direct trade for Turkish Cypriots. The UK is committed to liberalisation of trade with the Turkish Cypriot community but the relevant draft EU regulation is being blocked at the moment by the Republic of Cyprus.
Many of the issues surrounding any debate on Cyprus are understandably difficult and emotive. The noble Lord, Lord Maginnis, outlined some of these, including issues such as the fate of missing persons and the loss of one’s home, things that thankfully most of us will never have to face. Those who lived through the events in Cyprus’s turbulent past, and their children and grandchildren, are now living with the legacy of those events. It is absolutely right that we do not forget the past and that we acknowledge the pain suffered by the ordinary people of Cyprus, but we must also look to the future and continue to have faith in the UN-led settlement process. We must look to the leaders of the two communities, who ultimately are responsible for working together to deliver a package that the Cypriot people can believe in and which will secure the future for the reunited island, so that her people can live together in peace.
Until that future is secured, we hope, through the work of the technical committees, confidence-building measures and grass-roots initiatives such as the Stelios award for business co-operation, that the everyday lives of Cypriots can be improved and, in parallel, that trust between the two communities can regrow. It is only through building such trust that a stable and prosperous future for all Cypriots can be assured. I am sure that I have not answered all questions raised by noble Lords—
Lord Maginnis of Drumglass
I wish the Minister well in her new position in Government. However, it is a huge disappointment when we get a response to a debate that has been pre-prepared and does not answer a single question that has been raised. I would have thought that, at a time when the Prime Minister is talking about remembering the sacrifices of 1914, she might at least have had the initiative to address the matter I raised about 371 of our soldiers who died during the Cyprus emergency. I am disappointed that she has failed to do so.
Baroness Warsi
I was about to say in conclusion that I am sure I have not answered all the matters and questions that have been raised by noble Lords in an hour’s debate on such an important issue, about which there is so much expertise in this House. I can assure noble Lords, including the noble Lord, that I will respond to them in writing on any specific questions that have not been answered today.
Housing: Park Homes
(12 years, 1 month ago)
Grand CommitteeRead Full debate Read Hansard Text
Baroness Scott of Needham Market
To ask Her Majesty’s Government whether they intend to undertake legislative and policy changes to the park homes sector as a result of their recent consultation exercise.
Baroness Scott of Needham Market
My Lords, I am very pleased to have secured this slot for a Short Debate on the problems facing the park homes sector. There has been a flurry of activity in the past couple of years. The Government have concluded their consultation on the future regulation of the sector; the Communities and Local Government Select Committee carried out a full inquiry and produced an excellent report; my Suffolk colleague from the House of Commons, Peter Aldous, has sponsored a Private Member’s Bill on it, which had its Second Reading on Friday; and just last week Consumer Focus published its report into the sector, called Living the Dream?—with an all-important question mark. I am really pleased that such a well respected independent body has carried out research into park homes because their work has confirmed what we knew from a lot of anecdotal evidence. I will not say too much about it because I know we will be hearing from the noble Lord, Lord Whitty, who is very familiar with the work. We have a very good opportunity this evening to hear from the Minister where government thinking is on this matter.
I am very pleased that the noble Lord, Lord Graham of Edmonton, is with us this evening. He has been such a clarion voice crying out for this sector over many years and I pay tribute to you, Ted, for what you have done.
Baroness Scott of Needham Market
There are more than 2,000 park home sites in this country, predominantly in rural areas, and they house around 160,000 people in 85,000 homes. The residents are almost all approaching or beyond retirement age and many are of modest means. The Consumer Focus report notes that a quarter of these residents are over 75, so many of them are vulnerable. Determined not to be reliant on the state, they have chosen to live in park homes, often using the surplus equity from the sale of their previous home to supplement their pensions.
These dwellings are often called “mobile homes” but this is highly misleading. While they might be technically mobile, they are permanent residences and this is much more than a matter of words. It means that the legal framework that is set out in three main pieces of legislation, predominantly the Caravan Sites and Control of Development Act 1960, is entirely the wrong legal framework and woefully out of date.
I first became aware of problems in the sector more than 20 years ago when I was a district councillor and things have not improved. In its submission to the government consultation, the Local Government Association gave examples of site owners who overcrowd the sites, ignore licence conditions, make inadequate provision for drainage and sewerage, and dump rubbish. The current maximum fine is £2,500 and it is often cheaper for the site owner to pay the fine than to do the work. In any event, it costs councils to do the enforcement. In effect, local council tax payers are subsidising this abhorrent behaviour.
The solution proposed by the Local Government Association is that the sector is brought in line with the Housing Act 2004, which would allow for the issuing of improvement notices, prosecution for serious non-compliance, the power to carry out work and re-charge for it, and the registration of enforcement notices as local land charges. The current licence system is often manipulated because responsibility for compliance with site conditions does not necessarily transfer to new owners when sites are sold.
Service charges often bear no relation to the actual expenditure of the site owner on the site but it is difficult for the residents to dispute the bills. Some site owners are levying a VAT rate of 20% on the re-charges for gas and electricity. Many charge what home owners regard as excessive fees for site maintenance that is often not done at all.
It is the growing evidence of serious criminality within the sector that gives most cause for concern. I am indebted to Detective Chief Inspector Colquhoun of the West Mercia Police, who has become a nationally recognised expert in the field. He has successfully prosecuted 74 individuals, who received a total of 64 years in prison. He is personally leading efforts to increase awareness throughout the police force of the ways in which fraud can be perpetrated. The growth of criminality in this sector is a combination of the economics of the industry and the inadequate regulatory framework.
Most park homes are owned by their occupants, who must separately buy the pitch that it is standing on and pay ongoing service charges. A pitch can cost anything from £20,000 to £250,000, so this can be big money. Consumer Focus has shown that only around 1% of purchasers take legal advice before they buy, which is a serious problem. The restrictions on park home owners are so onerous that I imagine it simply would not occur to buyers that such a framework could exist, but it does and they often do not know until it is too late. A park home owner cannot sell their home without the approval of the site owner of the prospective purchaser. The site owner then receives 10% for doing very little. The purchase of the new pitch applies only to the original home. When it is replaced, a new fee has to be paid.
The service charges are peanuts compared to the money that site owners can make from their share of the sale of homes, particularly from buying and selling homes themselves. The abuses vary. Some allow the site to decline to a point where everyone who can leaves and the remaining residents are encouraged to sell their homes at knock-down prices to the site owner, who redevelops the site and sells new pitches at a very high price. Prosecutions have taken place of individuals who have decided to speed up this process by adding intimidation to their ways of encouraging people to leave.
Where owners wish to sell their home, site owners often veto numbers of prospective purchasers until in desperation the seller accepts a very low price from the site owner himself. Site owners have been known to intercept potential buyers at the entrance of the site or to pass on false information about the state of the home. There are examples of site owners visiting local estate agents to tell them that they are wasting their time marketing the homes because any new purchaser will be vetoed.
Site owners have been known to write to residents telling them that their home is defective and they will be evicted if they do not remedy it. Luckily, the ever-caring site owner is there to offer to buy their home from them, at a price far below its real value. Conversely, people who want to improve or refurbish their homes are often told that they need the site owner’s permission and that it will not be forthcoming.
A culture of intimidation and fear has grown up. Consumer Focus reports that one in 10 residents has experienced abusive and threatening behaviour. Many do not go to the police because they are simply too frightened. Let us remember that these are mostly older, often elderly, people. Some residents have organised themselves and have set up groups. We should recognise how much courage it takes to organise in this way because there are reports of serious intimidation against the organisers and members of such groups. The National Park Home Owners Congress held its meeting in Birmingham in the summer and it was attended by more than 4,000 people. It takes real guts to do what they are doing and we should support them not just with warm words but by providing a legislative framework that is fit for purpose.
Mr Aldous’s Bill, which I am very pleased has the support of the Government, will go a long way to creating that, but it is not of itself enough. The Bill is not retrospective and I understand that is because of legal advice that the Human Rights Act could be invoked if there were a retrospective change of contract. However, this leaves the current 160,000 people vulnerable to the sort of abuse I have described, in fact possibly even more vulnerable—I fear that there will be a sort of crime bonanza later on as the rogue operators see their cash cow disappearing. I would like the Government to think again and see whether there is a middle way of introducing this for existing tenants, perhaps a few years down the road, in such a way that does not impinge on the Human Rights Act. Can the Minister also undertake to look at the question of park homes and the Green Deal? Fuel poverty is a real problem in this sector.
Finally, while the Bill will include a fit and proper person test for site owners, it will not be implemented until it is deemed necessary later. Will the Minister accept that all the work I have referred to earlier has demonstrated that there is ample evidence of the need for such a test now? It is not just about driving the crooks out; we also need to provide comfort to the good operators who are being tarnished by these criminals.
I look forward to hearing the contributions from other noble Lords in this short debate and to hearing the Minister’s reply.
Lord Whitty
My Lords, I am very grateful to the noble Baroness, Lady Scott, for initiating this debate. She is quite right that a significant number of our fellow citizens now live in park homes on permanent sites. Some do so through lifestyle choice but, as she rightly says, the majority of them are quite elderly people who have done so at a stage in their lives when they wish to downsize. Their families have left home and this, in the face of an endemic housing problem, is their only choice. Some people of working age live in them because the cost of mortgages or rent is too high for them to live in the villages where they were born or in the towns in which they work. We have a significant population in this situation.
As the noble Baroness, Lady Scott, has said, many sites are well run by responsible site owners. We should note that right at the beginning. However, there are also far too many site owners who abuse their tenants, pay scant attention to the law and seem almost untouchable by the authorities. If the authorities do engage with the site owners, they pay little attention. As she says, the law needs substantial change. I welcome the consultation which Grant Shapps issued last year. I welcome Mr Aldous’s Private Member’s Bill and a similar Bill, which I think will appear in the Welsh Assembly this week, but we need a head of steam and the Government to get behind the action.
Before I go any further, I should declare my past and present interests. I am chair of the campaign group, Housing Voice, a vice-president of the Trading Standards Institute and a past chair of Consumer Focus. In the past few weeks, Consumer Focus and Consumer Focus Wales have produced damning reports of caravan owners’ experience on sites in England and Wales. I will refer to those in a moment. We have also had the Select Committee report in another place. The committee found that malpractice is widespread across the park home sector and the current law is inadequate. It neither deters unscrupulous park home site owners from exploiting residents nor provides local authorities with effective powers to monitor or improve site conditions. It particularly identifies sale-blocking as a significant problem.
I am calling for legislative changes, some of which are in the Private Member’s Bill before the House of Commons, to amend the Caravan Sites and Control of Development Act 1960, the Caravan Sites Act 1968 and the Mobile Homes Act 1983. It brings together the licensing regime that applies to mobile homes in England. A similar proposition is coming up in Wales. The issue of whether a site owner is a fit and proper person, however, is key to this. The Bill currently is quite weak on that proposition.
My first engagement in this area was brought about by two forces: first, my interest in energy and, secondly, the activities of my noble friend Lord Graham of Edmonton. During the passage of every energy and water Bill—we have had a good few over the past few years—he has brought up the position in relation to gas, water and electricity supply to those homes. In a mobile home park there is no standard way in which residents receive their water, electricity and gas, but the number of sites with individual metering is fairly small. Some are attached to the gas main but the vast majority are off the gas grid. In those situations, the site operator, the owner, has substantial powers in terms of selling on and resale. Significant numbers of residents have problems with their site owner, including, for example, more than a quarter of gas and electricity-supplied caravan owners in Wales.
The reports by Consumer Focus have come up with a number of suggestions in this area outwith changes in the primary legislation. It has asked the regulators, particularly Ofgem, to clarify and issue updated maximum retail price guidance to energy resellers and the rules surrounding reselling energy. It has also asked them to consider how they can help residents who are billed for their energy use by the site operator through a third-party billing company and to make sure that the standards and accuracy of those bills are guaranteed. It has also asked them to look at the level of reduction in energy costs which would be permitted under the maximum resale price rules guidance.
With Ofwat, Consumer Focus is looking for amendments to existing legislation to ensure that those who purchase their water and sewerage through site operators have equivalent rights to those who purchase direct, and, again, to clarify and update the maximum resale price. There is an agenda there for these 160,000 people, for legislation in this Parliament and on the activities of the regulators.
To pick up on a point made by the noble Baroness, Lady Scott, it is also obvious that park homes are not the most energy-efficient dwellings in the land. However, it would appear that very few of them have had any benefit from past fuel poverty or energy-efficiency schemes. In relation to the Green Deal, which is just now being launched, it is not at all clear how owners or tenants of park home sites will benefit. The previous Secretary of State, who was asked about this in 2011, said that park homes would be able to apply for the Green Deal. As matters stand, it is not at all clear that that can be the case. Access to finance is dependent on carrying out a methodology to assess the energy efficiency of the home, which is the standard assessment procedure. That is very difficult to apply—in general, it does not apply—to permanent caravan-site dwellings. The Department of Energy and Climate Change needs to look at this and see whether the potential for a Green Deal for owners of caravans could be enhanced. There is also the question of how the billing for that would operate when the site operator had an intermediary.
Outside the energy, gas and water areas, there are of course more general issues: the level of service charges, the failure of maintenance and the breach of various licensing conditions. In addition, regrettably, behaviour, as the noble Baroness, Lady Scott, has said, can amount to intimidation, threats and organised antisocial behaviour, and has inflicted great distress on a lot, albeit a minority, of these sites.
The licensing process is pretty inadequate, and the resources available to trading standards and others to enforce those licensing conditions are not at all adequate. The fit-and-proper test needs to be set in lights in this process. If we could build on the option of going down that road in the Private Member’s Bill, that would be useful, because there are people in this trade who clearly would not pass even a minimum fit-and-proper test.
The last issue that I want to raise is sale-blocking. In the course of its research, Consumer Focus Wales came across many disturbing cases of people wanting to sell and move away being faced with hostility, threats and what I might call physical and financial sabotage on the part of the site owners. Consumer Focus has come up with a number of such cases.
At the moment, the site owner has a veto over the ability to resell. In one such case, for example, the mobile home residents sold their home to an unscrupulous site operator for a fraction of its market value. In another, the home owner told how she had received just £2,000, despite the fact that the home had been valued at £110,000. In another case, a couple bought their home directly from the site owner for £150,000 but, when they tried to sell it, the site owner blocked the sale of the home to any other purchaser until eventually the couple agreed to sell it back to him for just £50,000, of which, in reality, they received only £35,000. That is gross deception and dishonesty but it arises from the anomalous power position between the owners and tenants of the homes and the site owners. In that case, having paid £35,000 for the home, the site owner subsequently sold it for £95,000.
So far, there have been no criminal proceedings of any sort against such people, and that is unacceptable in our society for a significant number of our citizens. We should start by following through with the Private Member’s Bill and the repeal of the relevant provisions on sale-blocking and the veto of the site operator.
I hope that the Private Member’s Bill succeeds but, even more, I hope that the Government take up this case and look at it across the board, perhaps strengthening the Private Member’s Bill or coming up with their own propositions which will ensure that the legislation, the regulations and the enforcement resources are available to end the distressing effects of the present situation.
Lord Best
My Lords, having given prior notice, I rise to make a brief intervention, and I thank the noble Baroness, Lady Scott, for initiating this short debate.
I have been honoured to accept the invitation from Peter Aldous MP to take the mobile homes Private Member’s Bill through your Lordships’ House when it finishes its passage through the other place. I was present at the Second Reading debate on the Bill in the other place last Friday and I was extremely impressed by the unanimity of approval for the Bill. As a Cross-Bencher, I was delighted to see that party politics played no part in that high-quality debate. Rogue site owners were named, powerful examples of malpractice were given, and the solutions contained in the Bill were commended from all sides.
I congratulate Peter Aldous MP on introducing the Bill and securing such strong support for it. Congratulations are indeed also due on the long-standing campaign for justice for park home residents by the noble Lord, Lord Graham of Edmonton, who has waited a long time for this Bill.
Lord Best
Thanks go, too, to the right honourable Grant Shapps, who was the Housing Minister who got behind this legislation and gave it government backing. Tribute must also be paid to the wonderful campaigners in the other place led by Annette Brooke MP, with backing from Natascha Engel MP and others associated with the APPG on this theme, propelled by faithful campaigners outside of Parliament, for whom this has been a long journey. I know that Members in the other place were greatly helped by the new Consumer Focus report, Living the Dream?, and the excellent analysis from Consumer Focus Wales, Park Life: Residential Mobile Home Living in Wales, and it is clear that the report from the CLG Select Committee, to which reference has been made, undoubtedly helped to win approval for the inclusion of the clause introducing the back-stop of a fit-and-proper-person test.
I noted five issues in the debate, a number of which have been considered by the noble Baroness, Lady Scott, and the noble Lord, Lord Whitty. None of them is a deal breaker, but all are worth discussing in more depth. My anxiety is that some existing park home residents may feel let down if their current defective leases have to remain untouched and those long-suffering owners continue to face appalling treatment at the hands of site owners, but it may be possible to address that, and I am sure the Bill will be even better when it comes to us.
This is an incredibly important piece of legislation. It may affect only relatively few people scattered across the country, often in remote places, but it is going to make a vast difference to the quality of life of so many of them. I look forward very much to helping to steer it through its stages in this House, where I feel sure it will get tremendous support.
Lord Graham of Edmonton
My Lords, it is a joy and a pleasure to have this opportunity, given to us by the noble Baroness, Lady Scott, to have a canter over the course. Undoubtedly when the Bill was passed last Friday, and I was there, many people, not least the Minister here today and the civil servants who have been frustrated over the years, were pleased. When I was in the Commons, I served on the 1983 Bill. Time after time the issues that have caused the problem have been raised. We made some progress, but all too often we were thwarted, not least by the change of ministerial responsibilities. Every time a Minister is led and schooled and has a grasp of the issue, unfortunately for the issue, he is moved on to other things. When Mr Grant Shapps came to the all-party meeting, I said that if he was not careful he would make a name for himself. Of course, he has made a name for himself. At that meeting he told us that time was precious and that if a Private Member’s Bill could be found, or if someone won the ballot, he would assist. I congratulate the Minister, who did what he was able to do, and we are all very grateful.
The Select Committee is invaluable. It is led by Clive Betts in the other place. The summary of the Select Committee’s first report states:
“Malpractice is widespread across the park home sector and complaints from residents about unfair fees, poor maintenance and site owners making it difficult for residents to sell their homes are common. Though we recognise that there are some good site operators, it is clear that action is needed now to improve the sector and drive the worst offenders out”.
There is no doubt that there are vast numbers of good site owners who have served loyally and long. However, I shall give the Committee an illustration that I have received. In Cornwall, there is a Mr Jeffrey Small, who is well known to those of us who have been following the issue. His wife is Barbara Small and his son is Jeffrey Small. They have been in trouble. Cornwall County Council said:
“The Smalls have been operating mobile park home sites for around 10 years, at times trading as J and B Small Park Homes and JBS Park Homes and often via offices … in Taunton”.
One of the problems is, of course, that it is not just the owner of one site—it is a site owner with many sites. Let me rattle through them. The park homes owned by Mr Small and his family include Battisford Park, Plympton; Beauford Park, Taunton; Beechdown Park, Paignton; Bickington Park, Barnstaple; Brimley Gardens, Bovey Tracey; Brookmeadow Park, Swindon; Broughton Park, Taunton; and others. Although I could go on, time would beat me.
The other problem is that we are talking not just about blocking the sale of park home sites but about other factors. One issue on which I am grateful to the Minister and his colleagues is the establishment of the Residential Property Tribunal, which is a mark along the way. It has been doing good work. I have here a report of a situation where Mr and Mrs Tony Glew raised some issues, but the site owners were found by the tribunal to have,
“failed to comply with the procedure incorporated into the agreement by Schedule 1, Part 1, Chapter 2 of the Mobile Homes Act”,
and so on. What is interesting here is that mention has been made of frail and elderly residents. This is what happened to the people in this case. The tribunal decision stated:
“On or about the 10th May 2011, they, or their servants or agents, entered the pitch of the park home address, removed and destroyed 2 gates and part of the fence, destroyed a large part of the garden, took up concrete slabs which had been used for parking a car and moved another section of fence all belonging to the Applicant and his wife. They then erected another fence to exclude most of the garden and all the car parking area from the pitch and to allow only pedestrian access to the park home”.
All this arose because the occupants, Mr and Mrs Glew —willing sellers—had found a willing buyer. Yet the landowners could not care tuppence about that. All the owners were interested in was whether the park home was making money for the business. They have a business and they are entitled to carry it on, but not to the detriment of the health or pockets of other people.
I am delighted that we have started on a journey. I know that I might have felt alone at times over the past 30 years, but this time I will not be alone and I am very grateful.
Lord McKenzie of Luton
My Lords, we should be grateful to the noble Baroness, Lady Scott of Needham Market, for initiating this debate. I suspect that we will have a wide degree of consensus in our contributions—there certainly has been already. We have the benefit of the introduction of the Mobile Homes Bill—a Private Member’s Bill in the other place—which had its Second Reading just last week, of the CLG Select Committee report in June of this year, and of the Consumer Focus report that my noble friend Lord Whitty spoke to.
It should be clear from our contributions in the other place that we support the Private Member’s Bill, and I am delighted that the noble Lord, Lord Best, has been asked to take it forward in our House. I am sure that it will have strong support right across the House, as he suggested. We also support the need for comprehensive measures to address the abuses that are all too prevalent in this sector, some of which have been mentioned. These abuses continue despite some measures being taken by the previous Government to improve matters; and, sadly, more measures never made the statute book. However, like other noble Lords, we should not let this occasion pass without acknowledging the role of individual campaigners—the most prominent of which has been my noble friend Lord Graham. His faith and determination over 30 years has kept the flame alive.
Lord McKenzie of Luton
My Lords, the Minister in the other place accepted that the practical constraints on the size of the Private Member’s Bill mean that it cannot include every issue on which the Government consulted. Perhaps some space in our legislative programme created by the lack of a House of Lords Reform Bill could give the Government time to take up more fully the issues that they feel have been left out by this Bill.
Perhaps the Minister could say, if extra time were available, what would be included in the legislation that the Private Member’s Bill currently excludes.
The problems with the sector are well documented. Inevitably, we have concentrated this afternoon on unscrupulous site owners—the noble Baroness, Lady Scott, referred to the “growing evidence of serious criminality” and that clearly is the case—but we should acknowledge that many site owners take their responsibilities seriously, as my noble friend Lord Whitty and the noble Baroness, Lady Scott, acknowledged. The need to stop abuses is especially great because most residents of park homes are elderly and increasingly vulnerable. I have a statistic that says that 70% of them are over 70 years old. Many of them moved to park homes in retirement, into what they saw as idyllic homes in attractive locations.
As my honourable friend Natascha Engel MP pointed out in the Second Reading debate last week—a point echoed by the noble Baroness, Lady Scott—the current legislation may be the Mobile Homes Act and the Caravan Sites and Control of Development Act, but we are talking about people’s homes. They may not be made of bricks and mortar but they are essentially static.
The noble Baroness and others have highlighted the key issues: lack of maintenance of sites, deliberate miscalculation of pitch fees and utility charges, sale-blocking and intimidation. The Second Reading debate in the other place highlighted some of the disgraceful practices around sale-blocking, which is often coupled with intimidation and harassment.
Perhaps the question we should be addressing now is: will the Private Member’s Bill be the effective way of tackling these abuses? The Select Committee recommendations in particular made reference to the removal of a site owner’s existing right to approve the buyer, an interim measure to give the residential property tribunal the right to award damages and compensation when sale-blocking takes place, and modernising local authority licensing arrangements.
The capacity and funding of local authorities to conduct their licensing activities is an important matter. Clearly, the ability under the Bill to charge for that will help with resources. Perhaps it would be inappropriate on this occasion to debate the wider issue of the capacity and resources available to local authorities, but funding by way of charging for licensing activities would not necessarily deal with the support that is needed—but it is a start.
We support the discretion to grant or transfer a site licence that will help and deal with the problem created by mandatory current requirements, and the powers to serve a compliance notice on site owners and to intervene to carry out work when compliance is not forthcoming are important, as stressed by the noble Baroness, Lady Scott.
A long-standing point of contention is whether or not site owners and operators should be fit and proper persons, just as they need to be for HMO licence holders. As the Communities and Local Government Committee pointed out, although it may be difficult to apply retrospectively, and would need to consider who would take over the management if somebody was disqualified, nevertheless there should be regulations to that effect—and we support that recommendation. Like the noble Baroness, Lady Scott, I ask the Government what will determine whether and at what point regulations should be brought in so that people have to be fit and proper persons.
The Select Committee recommendation was that,
“removing a site owner’s right to approve prospective buyers provides the only effective way to eliminate sale blocking”.
For new agreements, this seems to be a pretty straightforward arrangement but for existing agreements I think it is more protracted; the provisions in the Bill are less secure. I would appreciate the Minister’s view on that.
The Private Member’s Bill would appear to put us on the road to an effective regulatory regime for park homes. We are delighted to be able to support that and look forward to its passage through your Lordships’ House. However, it is not a panacea. My noble friend noble Lord, Lord Whitty, referred to issues that could or should be dealt with by regulation, particularly the rules around re-selling of energy supplies. Perhaps the Minister could say what is intended on that front, and address the question raised by the noble Baroness, Lady Scott, on the fact that this is not retrospective. How can we inculcate the provisions that are in the Bill in a way that could operate for the future, and will protect all of those who are at serious risk under current arrangements?
This has been a short but very important debate, and one that is timely, given the legislative process that is under way. I hope that that, in particular, will be a great comfort to my noble friend Lord Graham, for everything that he has done in the past.
The Parliamentary Under-Secretary of State, Department for Communities and Local Government (Baroness Hanham)
My Lords, I believe I can say without risk of being challenged by anybody at all, that this is a debate, perhaps unusually, for the noble Lord and myself, where there is absolutely no disagreement at all.
Baroness Hanham
We all welcome this legislation, and we will look forward to it when it gets to this House. As did other noble Lords in this debate, I pay tribute to the All-Party Parliamentary Group on Park Homes, which has raised the profile of the sector in Parliament and beyond. Absolutely crucial to that has been the noble Lord, Lord Graham of Edmonton. He may not remember, though I do, that as a rather new and very wobbly Front-Bencher, I took forward one of the many debates that he organised in this House, about 10 years ago. I remember that well, and I remember being persuaded by what he said, that here lay a big problem. It is a pity that it has taken us 10 years to get here, but here we are.
A number of noble Lords have mentioned my right honourable friend Grant Shapps. He grasped the situation when he became a Minister, and it was due to him that the residential tribunal was set up. It may not have had time yet to show all its teeth, but it is certainly starting to make an impact on this.
A number of important issues have been raised. I will try to deal with some of those; if I leave any out, then I will of course write to noble Lords. I also wish to comment on the Select Committee, which did an extremely good job, and to mention the Consumer Focus report, which absolutely confirmed the findings of the Select Committee.
As others have said, living on a park home site is an affordable choice of housing for many people. I have the figure of 85,000 households here—I do not think that we probably have much disagreement about that—and they are mainly elderly. It would also be fair to say that some or many sites are properly managed and maintained by decent, honest and professional site owners who look after the rights and the welfare of their residents and community.
However, the good work that they do is often completely masked by the unacceptable conduct of the minority—and we have had many examples of that today. They cause misery by not maintaining the sites properly, bullying residents, and interfering unreasonably or unlawfully when residents wish to exercise their rights, and their rights to sell—something that the noble Lords, Lord McKenzie and Lord Whitty, raised. The park homes sector should have no place for these people. We want the good site owners to thrive and we absolutely want the bad to wither and go away. We are therefore committed to targeted reform, which does not place unnecessary burdens on those site owners who operate in a well regulated and lawful manner.
The Communities and Local Government Select Committee’s inquiry received 250 pieces of written evidence and held four oral sessions in the spring, including one in Bournemouth at which it took evidence from home owners and site operators. As has been mentioned, the committee’s report showed that the catalogue of problems that people had been raising were a fact. It formed the view that malpractice was widespread. Many of the responses to the Government’s consultation, which ran from 16 April to 28 May this year, found that that was the conclusion. We received 621 responses, many of which corroborated the evidence to and findings of the Select Committee. The Government’s response has been published on the Department for Communities and Local Government website.
In the mean time, my honourable friend the Member for Waveney introduced, with government backing in the other place, a Private Member’s Bill for which reference has been made to reform the law on mobile homes. It may not cover all the points and aspects that everyone wants. Maybe during the course of its passage through one or other House it may be strengthened, but at the moment it is as it is. It received its Second Reading and will now proceed to its Committee stage. I understand that when it passes all stages—my brief says “should it”, but I am reasonably satisfied that it will do well—the noble Lord, Lord Best, will pilot it in this House. I am sure that he will have good support here as well.
I must emphasise that the Bill focuses on permanent residential sites and will not apply to holiday homes, even those where the residents live there for up to 10 or 11 months in a year, with just a month away from it. It applies purely to those sites that are residential where the home owners have agreements under the Mobile Homes Act 1983, including mixed-use sites such as those that are partly residential and partly holiday.
The provisions in the Bill relating to changes to the Mobile Homes Act will not apply to local authority traveller sites either because sale blocking is not in question on such sites, as sales are not permitted. But there was also no evidence that the other changes to site rules and pitch fees were required where ownership was in the hands of local authorities. I ought to say that I am quite glad about that.
The Bill’s objective is to put the park home business on a proper footing for the future, where honest and professional site owners can prosper, while those who abuse their legal powers and have no regard for the welfare and rights of their residents or their health and safety will no longer be able to profiteer. As we have heard, the Bill aims to achieve this by introducing light-touch reforms that target the worst practices, minimising the burdens on good operators. Through these measures, we hope that residents will be able to live peacefully in their homes, secure in the knowledge that their lives, health and safety will not be endangered and their rights respected. The Bill contains most of the key measures on which the Government consulted earlier in the year and builds on the Select Committee’s recommendations following its forensic inquiry into the park homes industry and its practices.
The noble Lord, Lord Whitty, and the noble Baroness, Lady Scott, referred to unlawful sale blocking, which was one of the most serious complaints. It is clear that the practice is not confined to a small number of rogue operators. In some parts it appears to be acceptable practice that the landlord should be able to put their foot down for a sale, but it is not acceptable practice.
Park home owners are as a matter of law entitled to sell their properties on the open market. However, also as a matter of law, the site operator must approve the buyer. To some this seems a sensible way of ensuring that the purchaser would meet the rules that apply to the site, for example on age, family composition or the keeping of pets. However, some site owners abuse this process to thwart a sale by not responding to the request for approval at all or by making contact with the buyer and putting them off proceeding.
Although there is a right of appeal to a residential property tribunal, which was brought in by this Government in 2011, if an approval has been unreasonably withheld, very few cases reach the door of the tribunal because the purchaser has normally withdrawn from the transaction by the time this happens. In fact, of the few cases that have been decided by the tribunal, in every case they found the site owner had acted unreasonably in not responding to the request or in refusing the approval.
As has been said, site operators are legally entitled to a 10% commission on the sale of a park home, so if one was sold for £80,000 they would be entitled to £8,000 of the sale price. The Government do not intend to interfere with that aspect. However, an unscrupulous operator realises that he can make significantly more than £8,000 by refusing to approve the purchase. Often if the home owner urgently needs to move or if purchasers are persistently refused, the home owner is forced to agree to sell. Indeed, we have heard today of some who have sold for as little as £2,000. No other form of home ownership sales is subject to such interference and abuse. I confirm that we fully support the measures in the Bill to restrict the role of site owners in approving buyers of homes from existing residents and to remove that role altogether in respect of future sales by new residents.
Allied to this is the strengthening of the criminal law against harassment and to make it a criminal offence to make false or misleading representations to prevent a sale from proceeding. There is also widespread concern that pitch fee increases lack transparency and unlawful charges are often included. The Bill addresses this by requiring site owners to set out in a notice precisely what is included in the proposed pitch fee and if this notice is not used the pitch fee review will be invalid.
Another major problem identified from the consultation and in the committee’s report is the condition of many sites and the poor quality of services and amenities to them because of either underinvestment over the years or, in some cases, a deliberate policy of allowing or causing whole sites or parts of sites to fall into disrepair. This was underlined by the noble Lord, Lord Graham, telling us about the site owner who had effectively wrecked one of the homes. The Bill will permit local authorities to address such problems through a more effective licensing regime that will enable enforcement action to be taken against those who do not keep their sites properly maintained. I am sure that local authorities that are affected by these problems will be only too happy to take up the cudgels.
The noble Lord, Lord McKenzie, asked whether there would be room for more and more legislation on this. I am sure he does not really expect me to answer that. There are people who make decisions about legislation other than me, but we will enthusiastically follow this Private Member’s Bill through from beginning to end.
Lord McKenzie of Luton
If the noble Baroness will forgive me, the question was that if there were scope, what would the Government be happy to support further in terms of primary legislation?
Baroness Hanham
My Lords, at the moment the Government support everything that was in the consultation. There are areas where we are waiting to see what happens as a result of the Bill’s implementation and further consultation; the fit and proper person test is probably one, but it is very much on the radar because it was brought up very significantly in the Select Committee report.
The noble baroness, Lady Scott, asked about the human rights aspect. We cannot take away altogether the site owner’s contractual right to approve, but we have in fact reversed the burden of proof. Refusal can be made only on certain grounds and only with agreement of a residential property tribunal.
Baroness Scott of Needham Market
I am grateful to the Minister for allowing me to intervene because I know that she is short of time. My concern about the way the Human Rights Act is being interpreted means that it cannot apply retrospectively. Current owners will remain vulnerable; only the new owners will have protection. I am very nervous for current owners, particularly as I fear a kind of bonanza where people will see this money-making opportunity drying up in the future. The situation could inadvertently become even worse for the existing tenants than it is at the moment.
Baroness Hanham
I am sorry if I misunderstood the point, but it is one that is extremely well made. As my noble friend says, the Bill is not retrospective, as indeed most legislation is not. Potentially, however, it will offer protection in a perilous situation. Unfortunately, there will be bad site owners until they are stopped.
The noble Lord, Lord Whitty, asked about fuel poverty. We are talking to DECC about the application of the Green Deal to park homes. However, as this is a Private Member’s Bill, we cannot connect them together. Someone may wish to try to strengthen the law as time goes on.
I think that I have dealt with the issue of the fit and proper person test as best I can, and as I say, there is going to be very much a watching brief on that. That probably covers most of the aspects that have been raised in our debate. I hope that I have made clear that we strongly welcome and support the measures in the Bill. They are indeed long overdue because too many people have been put in jeopardy for too long a time. I hope that the Bill will get as far as this House and that it will be passed unanimously in the other place. We will then have an opportunity to consider it—it is hoped in the not too distant future. A Private Member’s Bill will provide at least some protection for those who have been suffering for a long time.
House of Lords
European Defence Agency
(12 years, 1 month ago)
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Lord Anderson of Swansea
To ask Her Majesty’s Government what has been the outcome of the review of the status of United Kingdom membership of the European Defence Agency announced in October 2010.
The Parliamentary Under-Secretary of State, Ministry of Defence (Lord Astor of Hever)
My Lords, first, I am sure that the whole House will wish to join me in offering sincere condolences to the families and friends of Lieutenant Andrew Chesterman of 3rd Battalion The Rifles, Lance Corporal Matthew Smith of 26 Engineer Regiment, Guardsman Jamie Shadrake of 1st Battalion Grenadier Guards, Guardsman Karl Whittle of 1st Battalion Grenadier Guards, Sergeant Lee Davidson of The Light Dragoons, Lance Corporal Duane Groom of 1st Battalion Grenadier Guards, Sergeant Gareth Thursby of 3rd Battalion The Yorkshire Regiment, Private Thomas Wroe of 3rd Battalion The Yorkshire Regiment, Sergeant Jonathan Kups of the Royal Electrical and Mechanical Engineers, Captain James Townley of the Corps of Royal Engineers and Captain Carl Manley of the Royal Marines who died on operations in Afghanistan recently.
My thoughts are also with the wounded, and I pay tribute to the courage and fortitude with which they face their rehabilitation. Once again, we are reminded of the immense danger that our Armed Forces operate in to uphold our safety and security. Their families and the whole country should rightly be proud of their heroic service and we shall always remember them.
Turning to the Question, Ministers are still considering the case for UK membership of the European Defence Agency with the aim of announcing the outcome of the review before the end of the autumn. As part of that review, we are looking at the activities of the agency’s four main directorates of capability, research and technology, industry and markets and armaments to assess the benefits received by our membership, including on our international relationships and what improvements there have been in the agency since 2010.
Lord Anderson of Swansea
My Lords, we all join the Minister in those condolences and tributes to our brave soldiers.
The two-year period of review has now passed with no outcome. Does that mean there is some rift within the coalition? Will the Government now recognise, as indeed EU Sub-Committee C recognised, that we benefit from the pooling and sharing within the agency and that the agency does valuable work in niche areas such as counter-IED, medical support, helicopters and cyber warfare? Further, if there were not a positive response, there would be an almighty row with our French partners.
Lord Astor of Hever
My Lords, there are no rifts and there is no hidden agenda. We said that we would review our membership after two years. We will then provide an Explanatory Memorandum and notify both Houses in the normal way as soon as possible. I am aware of the benefits that the EDA has delivered, but we need to review the full benefits and improvement goals that it has set for itself. In an age of financial austerity, we must ensure that every pound of taxpayers’ money counts for defence.
Lord Jopling
My Lords, did the Minister see the recent report of the same sub-committee which the noble Lord just referred to? The committee’s report said that given that the EDA,
“is deemed to be well directed under its current management, it should be given the proper tools and commitment to do a proper job. The UK and France should take the lead”.
Will the Government take that opinion into account in coming to a decision?
Lord Astor of Hever
My Lords, I have read the report of Sub-Committee C and, as I said in my reply, we will take this into account in the review.
Lord Liddle
My Lords, does the Minister accept that, in the age of financial austerity that he referred to, there is a very strong case for common defence procurement if it can be done economically within Europe, and that potentially the agency has a huge role to play in making that work much better than it has in the past?
Lord Astor of Hever
My Lords, I agree with that. If we can do it economically, this makes a lot of sense.
Lord Palmer of Childs Hill
My Lords, first I wish to identify these Benches with the sad condolences expressed by the Minister. Does my noble friend agree that some of the successful examples of European Defence Agency initiatives are both the air-to-air refuelling and the helicopter training exercises which have been completed this week? Could he detail any other recent achievements of the EDA?
Lord Astor of Hever
My Lords, the EDA has seen significant success in a number of capability areas; for example, as my noble friend said, helicopter training which has directly increased the number of pilots available for operations in Afghanistan. By enhancing the capabilities of smaller member states, we receive an indirect benefit through better burden-sharing in operations. I understand that 114 crews—that is 1,300 personnel—have been trained, of which 63 have been deployed to Afghanistan. My noble friend mentioned the air-to-air refuelling initiative. As part of pooling and sharing, the EDA is taking a lead in facilitating European capability development in this area. This has not yet delivered results but the initiative is at an early stage. This issue was highlighted in operations over Libya where the US provided the vast majority of air-to-air refuelling capability. If I may, I will write to my noble friend on the other achievements—European military air-worthiness, the requirements initiative, industry and markets, and the capability development plan.
Lord Soley
Are the Government looking at sharing with the French the facilities recently opened at RAF Waddington for the control of UAVs?
Lord Astor of Hever
My Lords, I went up to RAF Waddington a couple of weeks ago and saw for myself what the noble Lord has talked about. I cannot answer from the Dispatch Box whether the French will be involved in that. As I have said previously from the Dispatch Box on many occasions, I welcome as much co-operation with the French as possible. We are working with them in a lot of areas. Noble Lords may have seen in the Daily Telegraph today the photograph of our Royal Marines training off Corsica with the French marines.
Lord Hamilton of Epsom
My Lords, would not European defence co-operation have been enhanced if the merger between BAES and EADS had gone ahead? Was it not a tragedy that this deal was bombed by Chancellor Merkel?
Lord Astor of Hever
My Lords, I agree with my noble friend that there would have been some benefits from the two companies joining up. However, having said that, I think that BAE will continue to thrive on its own. It has some wonderful products and Ministers in the Ministry of Defence do their very best to help BAE sell them.
Lord Williams of Elvel
My Lords, are the Government seriously considering withdrawal from the EDA? Is that one of the options under review?
Lord Astor of Hever
My Lords, it is an option; we are doing a review. As I said earlier, we will report back to the House as soon as possible.
Lord Pearson of Rannoch
My Lords, if the Minister and the Government had to choose between a row with our French partners and the lasting disengagement of the United States of America, which would they choose? When the Minister writes to the noble Lord, Lord Palmer, listing all the glorious achievements of this agency, will he commit to putting a copy of the letter in your Lordships’ Library?
Lord Astor of Hever
My Lords, to answer the noble Lord’s first question, I try to be as diplomatic as I can in relations with both the United States and the French, and I would certainly not want to get involved in any disagreement.
Small and Medium-sized Enterprises
(12 years, 1 month ago)
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Lord Cotter
To ask Her Majesty’s Government what action they are taking to address the issue of late payments to small and medium-sized enterprises.
Lord Wallace of Saltaire
My Lords, central government policy is to pay undisputed invoices within five days and to pass 30-day payment terms down supply chains. Moreover, the Crown representative team in the Cabinet Office is encouraging prime contractors to pay more quickly than the 30-day commitment on a voluntary basis. We have tasked departments across Whitehall to manage their contracts to ensure that prime contractors pay their subcontractors within 30 days.
Lord Cotter
I thank the Minister for his Answer. Will he and his officials look at the important reports and surveys carried out by the Federation of Small Businesses and the British Chambers of Commerce and note their recommendations? There is a lot of very good information in there. I am glad that the Government have improved their record on payment, but it is still not satisfactory that local councils and other departments are not paying as promptly as they should. I am encouraged by the Minister saying that government departments are going to look at their suppliers. I ask him to ensure that they sign up to the prompt payment code.
Lord Wallace of Saltaire
My Lords, I have it in my notes that the Local Government Association, in the form of no less an important person than the noble Baroness, Lady Eaton, has agreed that local authorities will be encouraged similarly to follow best practice in this regard. The Cabinet Office has among other measures introduced a “mystery shopper” service through which small contractors who are dissatisfied with the service they are getting, either from a department or from a prime contractor, can anonymously feed this information through to the Cabinet Office.
Baroness Sharples
What is the average time taken by ministries to settle their bills?
Lord Wallace of Saltaire
I suspect that the answer is that because there are so many bills that have to be paid it would take a great deal of time, effort and cost to acquire that information.
Baroness Wall of New Barnet
My Lords, does the noble Lord take assurance from the fact that, certainly in the health service, we have penalties for not paying small and medium-sized businesses first, before we do anything else, no matter where we are in the budget? I think that that ought to apply perhaps in other places as well. I had intended to save my question for the next debate but I just could not resist saying that.
Lord Wallace of Saltaire
Thank you. It is an aspiration of this Government to increase the proportion of government contracts which go to small and medium-sized enterprises. When we entered government, the proportion of government contracts going to SMEs was 6.5%. Our aspiration is to reach 25% by 2015. The latest figures we have are that we are almost at 10.5%, so we have some way to go but are going in the right direction.
Lord Borrie
The Minister has confined his answers so far to government or governmental bodies which owe debts to small and medium-sized firms. What about simply the failure of large firms to pay small firms the money they owe them? So far, it is left to the initiative of the SMEs. Since there is a significant Bill going through Parliament at the moment dealing with financial services, I wonder whether one might get more results if the public officials of those bodies that are to take over from the Financial Services Authority under the new Financial Services Bill had a responsibility to ensure that debts were paid.
Lord Wallace of Saltaire
My Lords, the Government are not yet convinced that we need to take legislative action, but we are thoroughly in favour of all pressure possible to encourage large corporations to pay their small contractors as fast as possible. There is indeed a new booklet produced by the Association of Chartered Certified Accountants, Experian, the Forum of Private Business and the Institute of Credit Management which is a guide on how to ensure prompt payment and has been produced in co-operation with the Government. I must say that a number of newspapers, including in particular the Telegraph, have been very helpful in exposing the tendency of some large corporations deliberately to delay payment to their subcontractors. We all know that transparency and reputational damage are things which multinational companies are well aware of, supermarkets included.
Lord Trefgarne
My Lords, if my noble friend wishes to increase the number of small and medium-sized enterprises which tender for and secure government business, will he have a look at the complexity of government tendering processes which tend to put off smaller companies from competing in those competitions?
Lord Wallace of Saltaire
My Lords, we are also well aware of that. My right honourable friend Francis Maude and others have been looking in particular at the complexity of the pre-qualification questionnaires. We are doing our best to get rid of those for all contracts below £100,000 per year and to simplify the pre-qualification questionnaires for all others.
Baroness Hollis of Heigham
My Lords, following the last question, I ask the Minister also to look at the contracts offered by the Department for Work and Pensions. In terms of getting people back to work, these contracts are going to very few, very large contractors, and as a result charities and voluntary organisations which in the past have done this work are now being pushed out of the bidding process.
Lord Wallace of Saltaire
We are well aware of this problem. We are talking about a culture change within Whitehall. We are conscious that it is often easier when drawing up a large contract to give it to a prime contractor who will then subcontract, rather than having to go through the more onerous processes of distributing it around the country. That is part of the culture that we are trying to change.
Baroness Brinton
My Lords, the Minister’s earlier response on the problem with large companies was illuminating. However, if we are going to rely on investigating journalists to uncover such cases, would it not be better for the Government to consider forcing large companies to publish how many days they take to pay people in their annual reports?
Lord Wallace of Saltaire
My Lords, I dare say that that is a question which will come up if and when we next move on to a company law reform Bill.
Lord Mitchell
My Lords, small companies in particular depend on prompt cash flow—indeed, it is their lifeblood. However, it is still true that many organisations in different areas, but particularly those in the public sector, are notorious for paying late. Despite the assurances that the Minister has given, I ask the Government to issue a firm directive to all organisations in the public sector stating that payments to SMEs are to be made within a short time after the receipt of an invoice.
Lord Wallace of Saltaire
My Lords, the Government have done that and are introducing a number of practices to ensure that that is done. The mystery shopper and other efforts are always feeding back to ensure that where it is not yet done, steps are taken to improve matters.
NHS: Accident and Emergency Services
(12 years, 1 month ago)
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Baroness Gardner of Parkes
To ask Her Majesty’s Government whether, in relation to proposals to restructure NHS services in north-west London, the Department of Health has entered into dialogue with Transport for London regarding traffic levels and their impact upon speed of access to accident and emergency services.
Baroness Gardner of Parkes
My Lords, I beg leave to ask the Question standing in my name on the Order Paper and declare my interest as a local resident.
The Parliamentary Under-Secretary of State, Department of Health (Earl Howe)
My Lords, the reconfiguration of front-line health services is a matter for the local NHS, and any decisions regarding changes to services will be taken locally. I understand that the local NHS has worked closely with Transport for London and also with the London Ambulance Service in developing its proposals for the future shape of health services across north-west London under the Shaping a Healthier Future programme.
Baroness Gardner of Parkes
I thank the Minister for that Answer. My Question could really apply to anywhere in the country. The general principle is how long it takes to get patients to hospital, particularly in emergencies, when it is a matter of life and death in some cases. In London, there is only one air ambulance; I understand that in Paris, there are four and in Sydney there are six. We cannot rely on one air ambulance to deal with the problem. Will the Minister consider the general principle of a national view of traffic in relation to access for ambulances?
Earl Howe
My noble friend makes some important points. As a general point, it is important to say that each ambulance service should plan to provide appropriate resources to meet local demand, because demand varies according to where you are in the country. Planning assumptions in meeting that demand should take into account the likelihood of severe traffic congestion. Plans of that kind may well include resources in addition to traditional ambulance provision, for example, using rapid response vehicles and motorbikes as well as utilising staff such as community paramedics or emergency care practitioners.
Lord Harris of Haringey
My Lords, how many accident and emergency departments in London does the Minister expect to close in the next four years? If he does not know the answer, can he say who is responsible for that and how they are accountable for making a strategic judgment across London about the level of accident and emergency services?
Earl Howe
The premise behind the noble Lord’s question is that it is automatically worse to have fewer A and E departments in an area. I beg to disagree with that premise. In serious or complex cases, the noble Lord will know that patients need to access exactly the right care, so it is often better and safer for them to travel further to see specialists in major centres than to go to a local hospital. Although it may be closer, it may not have the right specialists, the right equipment or sufficient expertise in treating patients with their condition. The prime example of that has been stroke care in London, where 32 centres were reduced to, I think, eight and there has been a dramatic reduction in the number of deaths following admission.
Baroness Jolly
My Lords, does the noble Earl agree that wherever there are improvements to patient care that involve restructuring not only of services but premises, the impact assessment in the consultation document should include general transport and ambulance access?
Earl Howe
I agree with my noble friend. The planning assumptions made in north-west London, which is the subject of the Question, are a good example of that, where Transport for London is co-operating actively by producing some sophisticated analysis not only of ambulance transport times but of bus and car journey times to make sure that nobody loses out in any reconfiguration.
Baroness Whitaker
My Lords, in the noble Earl’s answer to my noble friend Lord Harris, I did not hear an answer to any of his questions about numbers, who makes the decision and who is accountable. Would it be possible to hear that?
Earl Howe
My Lords, I apologise. The Question on the Order Paper relates to north-west London, so I do not have pan-London figures in front of me. The answer to the question is as I gave it in my initial response: those decisions are subject to local determination. That is right, because it is only local commissioners and providers who can assess the situation on the ground properly. As the noble Baroness will be aware, there is a system for escalating decisions—ultimately to the Secretary of State, if necessary, who takes advice from the Independent Reconfiguration Panel in the most extreme cases—but normally, we hope and expect those decisions to be resolved on the ground in the local area.
Baroness Masham of Ilton
My Lords, does the Minister agree that many patients have difficulties accessing their GPs and out-of-hours services? Does he realise that the only resource might be the A and E department? In a case of meningitis, that could be a death sentence if they cannot get that access.
Earl Howe
My Lords, I agree with the noble Baroness. That is exactly why the Government are planning to roll out the 111 service, which will run alongside the 999 service for emergency calls. But where the situation falls short of an emergency, the 111 service will instantly direct the patient to exactly the right service, without a call back being necessary. I am pleased to say that that programme is on track and should be rolled out next year.
Baroness Wall of New Barnet
My Lords, I declare an interest in Barnet and Chase Farm, which is currently being restructured. Does the Minister agree that, with any restructuring of services in the health service, the public are very concerned? A lot of effort is being made by the trust to assure people, but one of the things that keeps coming back—certainly for Barnet and Enfield—is that the bus services do not always work in the way in which the noble Earl has suggested, and that Transport for London is not always co-operative. Very often it is, but sometimes it is not; we are having a great deal of difficulty reorganising bus services in cases where Transport for London will just not hear of it.
Earl Howe
My Lords, in north London and Barnet in particular, Transport for London has diverted the 307 bus route into the grounds of Barnet Hospital, thus improving the link from Enfield. Transport for London has also installed new CCTV cameras in the underpass at North Middlesex University Hospital, in order to enhance its safety. There was a proposal to improve the local underpass at Silver Street station, and that was carried through. I am concerned to hear the noble Baroness’s perception, because all the briefing I have had indicates that Transport for London is very constructive in these situations and will often change bus routes in response to changes in service configuration.
Taxation: International Companies
(12 years, 1 month ago)
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Lord Harries of Pentregarth
To ask Her Majesty’s Government what steps they are taking to ensure that international companies pay a fair proportion of United Kingdom tax.
The Commercial Secretary to the Treasury (Lord Sassoon)
My Lords, the vast majority of taxpayers pay the right tax at the right time. However, the Government are alert to the risk that some companies may try to structure their tax affairs so that profits from UK-based economic activity are not taxed here. The UK has specific tax rules to combat tax avoidance by international companies and fully supports the Organisation for Economic Co-operation and Development initiative on base erosion and profit shifting, which has been endorsed by the G20.
Lord Harries of Pentregarth
My Lords, I am very glad to hear that the Government are alert to the situation of international companies, but would the Minister agree that, when they are being assessed for tax purposes, they should be required to reveal every country in which they are operating and the tax they pay in each country, with full financial details of their own company and link-companies? In addition to insisting on this for UK purposes, would the Government be prepared to work for an international agreement so that all transnational companies were required to give a fully transparent country-by-country report for any country in which they operated?
Lord Sassoon
My Lords, I certainly agree with the underlying premise behind the noble and right reverend Lord’s question, which is that there is still a lot more work to be done in this area. The international tax architecture was developed in an age of fixed factories and plant and machinery, with much less interconnectedness. Now we live in a connected, corporate world in which internet commerce and so on make it much more complex. That is why the OECD is again looking fundamentally at whether countries have the right weapons, whether it is tax treaties, under which the exchange of information would come; transfer pricing; aggressive tax planning; or harmful tax practices. I certainly agree that tax information is important to that but, as far as the authorities are concerned, that really comes under the tax treaties and the work that the OECD will be looking at.
Lord Barnett
Does the Minister accept that the Prime Minister’s, and indeed the Chancellor’s, definition of aggressive tax avoidance needs clarifying? In any case, does he accept that all tax avoidance schemes are always one step ahead of the Treasury and the Inland Revenue? Would it not be sensible and simple—all past Governments have always refused to do this—to have simple legislation to say that any tax avoidance scheme has to be approved by HM Treasury? Would that not solve the problem?
Lord Sassoon
The noble Lord, Lord Barnett, always wants me to be clear and simple, so the answer is no to his first two questions. On the third question, he has an underlying, quite proper, concern, which is why the work that Graham Aaronson has done for the Government on a general anti-avoidance rule, the so-called GAAR, is a very important part of ongoing work.
Lord Campbell-Savours
What are the Government going to do about Starbucks and its transfer pricing arrangements?
Lord Sassoon
My Lords, the noble Lord does not expect me for one moment to start commenting on the tax affairs of any individual taxpayer. As a general response, it may interest the House that the 800 or so largest companies that come under the large business service of HMRC to be assessed pay £136 billion in corporation tax, PAYE and VAT each year. Almost 50% of that tax comes from foreign-owned businesses, so I do not think we should have in mind that foreign-owned companies as a group are somehow doing something that we have to be vigilant about. We must keep this in proportion.
Lord Avebury
My Lords, do the OECD rules apply to internet-based companies, such as Amazon, and when will they come into effect?
Lord Sassoon
My Lords, a series of measures has been agreed internationally through the OECD over many years. The fiscal affairs committee of the OECD is having a new look at this, and this work was endorsed by the G20 at the Los Cabos meeting in June, to get those rules into a fit state for the 21st century. They are the rules that govern the relationships between countries and the base on which all companies should operate their tax regimes, but they need to be modernised.
Lord Davies of Oldham
My Lords, in responding to an earlier question, the Minister said that there was much work to be done in this area. Who is to do it? What is the point of the Government cutting Inland Revenue staff when there is so much work to be done? Staff concerned with revenue collection can collect 30 or 100 times the annual salary they receive.
Lord Sassoon
I am very grateful, as I often am, for the question asked by the noble Lord, Lord Davies, because it enables me to tell the House, as I have done before, that £900 million has been reinvested in the compliance activities of HMRC precisely because we need to do more work to attack avoidance, evasion and criminal attacks on the tax system. Compliance revenue has more than doubled in six years so that by 2014-15 an additional £7 billion per annum will be coming in. The noble Lord’s concerns are quite right, and this Government are very actively on the case.
Lord Campbell-Savours
My Lords, the Minister did not answer my question on transfer pricing, which is the mechanism used to avoid paying corporation tax. Why will he not answer my question?
Lord Sassoon
Because, forgive me, there are other Peers wanting to get in. I completely agree with the noble Lord that transfer pricing is one of the most serious areas that need to be looked at, which is precisely why each one of those 800 large companies has a dedicated tax professional looking at this area. The focus on transfer pricing has meant that in the past four years £4 billion has been recovered precisely by going after transfer pricing schemes. On average, £1 billion a year is coming in through effective action.
Trusts (Capital and Income) Bill [HL]
Baroness Anelay of St Johns
My Lords, I have it in command from Her Majesty the Queen to acquaint the House that Her Majesty, having been informed of the purport of the Trusts (Capital and Income) Bill, has consented to place her interests, so far as they are affected by the Bill, at the disposal of Parliament for the purposes of the Bill.
Lord Ahmad of Wimbledon
My Lords, on behalf of my noble friend Lord McNally, I beg to move that the Bill be now read a third time.
Lord Hodgson of Astley Abbotts
My Lords, before we wave goodbye to the Bill, and in congratulating the Government on its provisions, perhaps I may ask my noble friend to ensure that the Ministry of Justice understands that this was only a very small step and that there are many other aspects of the Bill as they affect charities which could usefully and properly be followed through.
Lord Ahmad of Wimbledon
My noble friend is correct. The Bill makes minor modifications and there is obvious scope to look at this issue further.
Lord Lloyd of Berwick
My Lords, I add my tribute to the work of the Law Commission in relation to the Bill. It is a short but useful Bill. In Clause 1 we say farewell to a number of old friends familiar to generations of law students, if to nobody else. Clause 4 is important since it gives greater flexibility to the trustees of charitable trusts. All in all, the Law Commission is to be congratulated on producing a valuable reform of the law and I look forward to its next instalment.
Bovine Tuberculosis
(12 years, 1 month ago)
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The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord De Mauley)
My Lords, with the leave of the House, I shall now repeat a Statement made in the other place by my right honourable friend the Secretary of State for Environment, Food and Rural Affairs. The Statement is as follows.
“Bovine tuberculosis is the most pressing animal health problem in the United Kingdom. The importance of the epidemic for our cattle farmers, their families and their communities cannot be overemphasised. This was once a disease isolated to small pockets of the country. It has now spread extensively through the west of England and Wales. The number of new cases has doubled every nine years. Last year, TB led to the slaughter of 26,000 cattle in England at a cost of nearly £100 million. In the past 10 years bovine TB has cost the taxpayer £500 million. It is estimated that this will rise to £1 billion over the next decade if the disease is left unchecked.
The task of managing bovine TB and bringing it under control is difficult and complex. The Government are committed to using all the tools at their disposal and to continuing to develop new ones as a package of measures to tackle the disease. In high-risk areas, herds are tested annually and any cattle that test positive are slaughtered. Restrictions on cattle movements have been further strengthened to reduce the chance of disease spreading from cattle to cattle. Only last week we announced plans for a new surveillance testing regime and stricter cattle movement controls. We also continue to look at ways to improve the testing of cattle for TB.
Research in this country over the past 15 years has demonstrated that cattle and badgers can transmit the disease to each other. Culling badgers can lead to a reduction of the disease in cattle if it is carried out over a large enough area and for a sufficient length of time. That is why we believe that, based on the best available evidence, culling badgers to control TB can make a significant contribution. It is crucial that we get this right. The National Farmers’ Union has taken the lead on behalf of the farming industry to plan and organise the pilot culls. It has been working tirelessly over the past few months, signing up farmers and landowners in the pilot areas and ensuring that contractors are properly trained. I have been immensely impressed by the effort, commitment and determination that have been demonstrated by farmers in the two pilot areas. I am also most grateful to the police in the two areas for their support.
The exceptionally bad weather this summer has put a number of pressures on our farmers and caused significant problems. Protracted legal proceedings and the request of the police to delay the start until after the Olympics and Paralympics have also meant that we have moved beyond the optimal time for delivering an effective cull. We should have begun in the summer. In addition to these problems, the most recent fieldwork has revealed that badger numbers in the two areas are significantly higher than previously thought. This only highlights the scale of the problem we are dealing with.
Evidence suggests that at least 70% of the badgers in the areas must be removed. This is based on the results of the randomised badger culling trial so that we can be confident that culling will reduce TB in cattle. Despite a greatly increased effort over the past few days and weeks, the farmers delivering this policy have concluded that they cannot be confident that it will be possible to remove enough badgers based on these higher numbers and considering the lateness of the season. It would be wrong to go ahead if those on the ground cannot be confident of removing at least 70% of the populations.
Today I have received a letter from the president of the NFU on behalf of the companies co-ordinating the culls, explaining why they do not feel they can go ahead this year and requesting that they be postponed until next summer. In these circumstances, it is the right thing to do and, as they are the people who have to deliver this policy on the ground and work within the science, I respect their decision. I have placed a copy of the letter in the Libraries of both Houses.
By starting the pilots next summer we can build on the work that has already been done and ensure that the cull will conform to the scientific criteria and evidence base. I know that this will be very disappointing for many, particularly those farmers in the two pilot areas, but I fully support the decision of the NFU to delay the start of culling operations.
I must emphasise that there is no change to the Government’s policy. We remain absolutely committed to it, but we must ensure that we work with the NFU to get the delivery right. We also remain committed to our wider TB eradication programme and to continuing to strengthen it, so that we can move towards our goal of a TB-free England. Vaccination is another tool and one that we would all like to be able to deploy more widely. Unfortunately, we are not yet there in terms of its development or practicality. If we had a viable and legal cattle vaccine, we would be using it. It will, however, be some years before this is the case and neither we nor the industry can afford to wait that long. It is for this reason that we must look at all the options.
The Government are determined to tackle bovine TB by all the means available to us. Now, in the next few months, we will ensure that the pilot culls can be implemented effectively, in the best possible conditions, with the right resources. Having looked at all the evidence over many years, I am utterly convinced that badger control is the right thing to do, and indeed the higher than expected badger numbers only serve to underline the need for urgent action. I remain fully committed to working with the farming industry to ensure that the pilot culls can be delivered effectively, safely and humanely next summer”.
Lord Knight of Weymouth
My Lords, I am grateful to the Minister for repeating the Statement and for advance sight of it this morning. We welcome this statement and it is right that it should start by setting out the scale of the animal health problem, and the cost to farmers and to taxpayers of slaughtering infected cattle. This is an acute problem for farmers and I know from talking to them in the West Country over many years what a toll it is taking on them personally and financially. It is therefore also right that the Statement concludes with the need to work with farmers. But as the president of the NFU says in his letter to the Secretary of State,
“all decisions must be based on the science”.
Why then no mention of working with the scientists?
I am pleased to see the noble Lord, Lord Krebs, in his place. He is one of the leading scientific authorities on this issue. What meetings has the new Secretary of State had with the noble Lord and his colleagues? Did the Minister read the comments of the noble Lord in last week’s debate on scientific advisors? He said,
“it is still the case that the Government, perhaps too often, prefer policy-based evidence rather than evidence-based policy … The fact is that the overwhelming majority of scientific experts have concluded that the policy of killing badgers to control TB in cattle will have only a small beneficial effect, if any. It is essentially a waste of effort and money, and a distraction from the business of getting on top of a serious animal health problem that can have devastating effects on the livelihoods of farmers”.—[Official Report, 17/10/12; col. GC514.]
The truth is that this is yet another humiliating moment for the Government and for Defra because they put prejudice and ideology before science and evidence. Can the Minister confirm that this is more of an NHS Bill type of pause, rather than another government U-turn? It is certainly another in a chain of weekly incompetent humiliations: plebgate; the west coast main line fiasco, when they also got the numbers wrong; the energy policy on the hoof last week; the great train snobbery; and now this from Defra.
From Defra we have had the abandoned forestry sell off, chaos over circus animals, a U-turn on shooting buzzards to protect game birds and now a pause on shooting badgers. No wonder the noble Lord, Lord Tebbit, said this weekend in the Observer that the Government,
“seems unable to manage its affairs competently”.
He described it as a,
“dog of a coalition government”.
I do not think the noble Lord likes dogs. I suspect he would like the country to put it out of its misery and have this “dog of a coalition” put down. However, beyond the endemic incompetence in Defra and the Government there are serious specific questions to answer. As my colleague Mary Creagh MP said in the other place today:
“Labour has warned the Government for two years that the badger cull was bad for farmers, bad for taxpayers and bad for wildlife”.
The Secretary of State is right not to proceed because the cull this year could not deliver the 70% mortality rate needed for the possible positive effect on bovine TB—up to 16% over nine years. His decision is based on there not being enough time to cull that many badgers in the limited time available, particularly given the growing number of badgers in the pilot areas. However, the numbers and the limited time were predictable and demonstrate the incompetence in Defra and that this announcement was inevitable. His Statement blames the weather, the police and the Olympics for a limited time window.
Was it not the Home Secretary who ruled out policing the cull this summer, not the police? Was not the limited window therefore predictable and decided by Ministers? Is it not the case that in July last year Natural England gave Defra badger population figures that projected from the randomised badger-culling trial that the numbers of badgers in pilot areas was 3,300 per 350 square kilometres? This is broadly the same as the current estimate of 3,000 per 300 square kilometres, so the larger number of badgers was predictable too.
Why did the Secretary of State in the other place today say that it was only in September this year that Natural England determined deficiencies in the numbers of badgers to be culled? Is it just to cover Defra’s incompetence or is it that those projections last year were ignored because it was inconvenient evidence not policy-based evidence? Can the Minister tell us whether the estimates of badger numbers in the planned pilot cull areas were reviewed by the independent expert panel overseeing the pilots? I have heard not. If so, that is shameful.
What is the department going to do during this pause before doing the cull next year? Will it need to secure more money? The Secretary of State said today in the other place that the Government will compensate the police forces in Avon and Somerset and Gloucestershire for their costs in preparing for the abandoned cull. If it is a more intensive cull of the larger numbers of badgers, will he need more than the current projection of £500,000 per cull area per year? Will there be any compensation for the two companies engaged to do the shooting? I gather £850,000 was to be spent on surveying badgers; £248,000 on post mortems; and £713,000 on checking the humaneness of the cull. Will those contractors be compensated?
Beyond the finance questions there are other areas of work between now and when the cull starts next summer. Will Ministers meet representatives of the tourism industry in Somerset and Gloucestershire? The notion of marksmen across the countryside that I know well shooting badgers at night has clear risks. Those risks are heightened because the location of shoots will be kept secret to frustrate protesters, but if the location of shooting is secret how will visitors in the summer months be warned to keep away?
How will Ministers work with farmers to maximise the effectiveness of the welcome announcement last week on changes to the testing regime and cattle movement restrictions? These sorts of biosecurity measures are a key component in controlling this dreadful disease. Can more be done with government support to improve biosecurity?
Finally, there is the core question of vaccination. The possible benefits of a cull are marginal. Sir John Beddington, the Chief Scientific Adviser, has said that it will, at best, result in a 12% to 16% reduction in the disease after nine years. The Statement pays tribute to the tireless work of farmers and contractors in preparing for the cull and funding it. What is the Government’s estimate of what can be done on vaccination over nine years with the same unity of purpose? The emerging DIVA test is an encouraging development to allow a diseased animal to be differentiated from a vaccinated animal. Surely this now makes it possible seriously to engage with the EU in lifting the ban on exports from vaccinated animals. The vaccine itself is 50% to 60% effective. We need more efficacy but it appears that good progress is being made in finding a scientific solution. Surely it is right to focus on this rather than on what the 30 eminent animal disease experts writing in the Observer 10 days ago described as a “costly distraction”.
My party is clear that bovine TB is a blight on dairy farming and causes untold misery to dairy farmers. We take it very seriously and we all want a solution. We know that growing numbers of diseased badgers are passing the disease to cattle and costing the taxpayer a fortune, but, unfortunately, the logic of then culling them does not follow because the science tells us that that is most likely to spread the disease unless such a scale of geography and intensity is used that it is clearly nigh on impossible to then deliver the cull. We must be led by the science and the science leads us to vaccination with interim efforts on biosecurity. That is what we want. That is what the nation wants. I hope that, after reflecting on this shambles today, the Secretary of State will abandon his dogmatic view and get it right by listening to both farmers and scientists.
Lord De Mauley
My Lords, I thank the noble Lord for his response to the Statement. I start by reiterating that bovine TB is the most pressing animal health problem facing our cattle farmers. No one wants to kill badgers but we absolutely have to bear down on this terrible disease.
What has been announced today is a postponement until next summer of the pilots that were due to start this autumn. There is no change of government policy. We and the farming industry remain committed to taking forward this evidence-based policy. We are totally committed to tackling bovine TB through a range of measures, including a controlled cull of badgers. The cull in the two pilot areas will go ahead next summer when we are completely satisfied that all the arrangements are in place.
The leading experts whom Defra brought together last year agreed that the evidence shows that culling done in the right way and carried out over a sufficient area and length of time in a co-ordinated and efficient way can reduce the spread of the disease to cattle with benefits remaining for many years. The policy is firmly based on evidence from the randomised badger-culling trial. Using the results of this trial, culling over an area of 150 square kilometres could be expected to lead to an average 16% reduction in TB incidence in the local area. This figure was agreed by an independent panel of scientists at a meeting with Professor Bob Watson, Defra’s Chief Scientific Adviser, on 4 April last year. We are clearly not saying that this is the whole answer but it is a very important part of the answer alongside testing and surveillance, movement restrictions and the removal and slaughter of affected animals. We wanted to be absolutely sure that we had the most robust data available to ensure that the right logistics were in place for an effective cull. The population estimates show the problem of badgers spreading bovine TB to be even worse than expected. The right decision has been taken, based on the available evidence.
Natural England’s figures were estimated on RBCT data and, in validating the estimates provided by the applicants, some gaps were found that raised concerns. Due to the importance of this data for the effectiveness of the policy, it was responsible, in taking a science-based approach, to check these numbers through further fieldwork. This further fieldwork has led to updated estimates of the badger population that are higher than originally expected. The discovery that there are far more badgers than previously thought shows the problem could be much bigger than we feared. All of the preparations for the pilot culls were geared up for a smaller number of badgers, so it is absolutely right that the NFU looks again at what resources it needs to make sure we get it right.
The noble Lord, Lord Knight, asked about policing. It was agreed with the Home Office that the cull should not proceed before the Olympics. The noble Lord asked about the costs of the culling operations and whether they would be met by the participating farmers. The costs that fall to Government are those to do with ensuring that the pilots meet their purpose. It is right to pilot the policy and confirm our assumptions about the effectiveness, safety and humaneness of controlled shooting. As regards costs more generally, the Secretary of State has said that he will have a comprehensive breakdown of the money spent so far prepared and laid before Parliament. The noble Lord specifically asked about policing costs. These will depend on the extent of protester activity and it is right that the Government should recompense the police for additional costs.
The noble Lord asked about vaccination, which is an important issue. Work to develop an oral badger vaccine and a cattle vaccine is continuing and is a high priority. Defra has been investing significantly in developing bovine TB vaccines for both badgers and cattle for a long time. We have a licensed, injectable vaccine that can and is used on badgers. The problem with it is, however, two-fold. First, it is very expensive to catch all the badgers. Secondly, it has to be done every year. So it is a very expensive process and is not really practicable on a wide scale. Since 1994, Defra has invested more than £43 million in badger and cattle vaccination and associated diagnostics and expects to spend another £15.5 million over four years. Even if these vaccinations were available, they are not a magic bullet and additional measures would still be necessary.
The Government fully support the NFU’s decision to postpone the culls as the responsible thing to do to ensure the pilots are carried out effectively. It would be irresponsible to rush ahead and risk making the problem worse if it is not carried out properly. This disease led to the slaughter of 26,000 cattle in England last year and cost nearly £100 million. Without further action it would cost the taxpayer an estimated £1 billion over the next decade.
Baroness Northover
I remind noble Lords that ministerial Statements are made for the information of the House. Although brief comments and questions from all quarters are allowed, Statements should not be the occasion for an immediate debate. I am acutely aware that many noble Lords wish to get in. It would therefore be courteous if noble Lords could be as brief as possible, to enable their noble colleagues to get in as well.
Lord Krebs
My Lords, as has been said, bovine TB is a serious problem, and it deserves serious science to underpin policy. I do not want to take up too much time, but I hope that your Lordships will forgive me as an individual who has been involved in this over the past 15 years and, as has been said, instigated the randomised badger culling trial and took part in the review of the evidence with Sir Bob Watson last year. It is worth briefly repeating the facts: the long-term, large-scale culling of badgers is estimated to reduce the incidence of TB in cattle by 16% after nine years. In other words, 84% of the problem is still there. To reflect on what that means, this is not a reduction in absolute terms but actually a 16% reduction from the trend increase. So after nine years there is still more TB around than there was at the beginning; it is just that there is 16% less than there would have been without a cull. The number is not the 30% that the NFU quoted; that is misleading—a dishonest filleting of the data. The other thing that the experts conclude is that culling makes the situation worse at the beginning so it will take a long time to emerge into this Nirvana of a 16% reduction, and 84% of the problem is still there.
That is just the background. I turn to questions that I hope the Minister will answer. Last Friday we were told by the Minister of State for Food and Farming that between 500 and 800 badgers would be culled in each of the two areas. The number, thanks to rapid badger reproduction over the weekend, is now 5,530 over the two areas—a fourfold increase. I am impressed. What this underlines is that if the policy is to cull at least 70% of the badgers, we have to know what the starting number is. This variation from just over 1,000 to more than 5,000 in the space of a few days underlines how difficult it is for us to have confidence that the Government will be able to instruct the farmers to cull 70% if they do not know the starting numbers. So my first question to the Minister is: how will he assure us that these numbers are accurate?
If we ask why the NFU has backed out, it is because it was due to pay those who were going to shoot the badgers on a per-badger basis. The NFU calculated it on the basis of shooting 1,300 badgers. Suddenly it is told, “It’s 5,500 badgers”. The farmers thought it was worth doing—but not that much. They have done their own cost-benefit calculation and say that it is not worth the candle. So my second question to the Minister is: in next year’s cull, who is going to pay? Are the farmers going to stump up on a per-badger basis to shoot 5,500 badgers or are we, the taxpayer, going to pay?
Finally and briefly, we have a pause and time to rethink. I urge the Minister to gather together scientific experts and rethink the Government’s strategy altogether, starting from square one.
Lord De Mauley
I am grateful to the noble Lord, for whom I have a huge amount of respect. I am grateful to him in particular for confirming the 16% figure to which I referred in my answer to the noble Lord, Lord Knight. On the question of whether culling is not a huge part of the answer, it is a very significant part of the answer but I said earlier that it is not the whole answer. I hope that the noble Lord, Lord Krebs, will at least accept that.
He asked about the numbers. I explained to the noble Lord, Lord Knight, that previous estimates of the number of badgers to be removed from the pilot areas were based on the RBCT. We have recently carried out field surveys to look at the badger populations in the areas where the pilots are taking place. However, what is important in answering the question of the noble Lord, Lord Krebs, is that we have commissioned a national badger survey in England and Wales to quantify any changes since the previous survey.
The noble Lord asked about the cost and, in particular, whether the farmers will continue to bear the cost. Yes indeed, they will; that is entirely the plan. The bearing of the cost will be done in exactly the way that has been planned.
I should say to noble Lords, on the issue of the evidence and the science, that, following the March 2012 visit to the UK of the European Commission’s bovine tuberculosis sub-group of the task force for monitoring animal disease eradication, it stated:
“It is however of utmost importance that there is a political consensus and commitment to long-term strategies to combat TB in badgers as well as in cattle ... There is no scientific evidence to demonstrate that badger vaccination will reduce the incidence of TB in cattle. However there is considerable evidence to support the removal of badgers in order to improve the TB status of both badgers and cattle”.
So the European Commission is pushing us and we have to deal with TB in badgers.
Baroness Parminter
My Lords, I will be brief. Our priority on these Benches was always that the pilots were safe and rigorous in testing how effective and indeed humane the culling of badgers could be. However, given that the NFU does not have the resources to deliver this, we welcome the fact that the cull is being postponed. Will the Minister confirm that the Government will use this pause, before any evidence-based pilots proceed, to seek approval to use in the field the cattle vaccine and the diagnostic test, which has recently been approved, and in particular seek to use the EU animal health directive, which is upcoming?
Secondly, the Secretary of State confirmed today in another place that all options will be looked at in order to curtail this disease. Will the Minister confirm that those alternatives will not include looking again at the issue of gassing, which was condemned in a review by Lord Zuckerman, a Member of this House, in the 1980s?
Lord De Mauley
My Lords, I thank my noble friend for her supportive words. We have had discussions with the EU that essentially involve persuading the EU to accept the DIVA test. They have told us to get international validation and we are determined to do so.
Lord Soulsby of Swaffham Prior
My Lords, in view of the great success in controlling rabies in foxes in western Europe with an oral vaccine, has much thought been given to the production of an oral vaccine for TB in badgers? I realise, of course, that the organisms are entirely different; one is a virus and one is a bacterium. However, surely the same process of trying to select an organism that is protected before it gets into the gut and immunises the badger is worthy of investigation. Can the Minister give some indication of some of the work that is going on, if any, on the production of an oral vaccine similar to the one developed for fox rabies?
Lord De Mauley
I am grateful to my noble friend because this is an important subject into which considerable work is going on. The evidence that he has referred to will of course be taken into account. Progress on the development of an effective oral badger vaccine relies, of course, on scientific breakthroughs in this field, and it is uncertain in outcome and timing. Compared to an injectable vaccine, an oral vaccine is technically more difficult to formulate, as my noble friend alluded to, and it requires bait, which encourages the uptake of the vaccine by badgers and minimises the potential of other species to eat it. Developing an oral vaccine against TB in badgers is proving more difficult than originally hoped, which means that I cannot say with certainty when one might be available for use in the field.
Lord Winston
My Lords, will the Minister inform us whether the Government intend to cull the seven or eight other common species which also affect tuberculosis and spread it among cattle?
Lord De Mauley
That is an interesting question. Although bovine TB is present in other wildlife, such as deer, badgers are the main species responsible for transmitting the disease to cattle because of their specific ecology. Evidence from the RBCT demonstrates conclusively that badgers contribute significantly to bovine TB in cattle. While deer in Britain are generally considered to be a sentinel or spillover host of infection in cattle, rather than a source of the disease in cattle, current evidence suggests that TB infection from deer is not a significant disease risk to cattle.
Lord Plumb
My Lords, as a farmer, my question is based on some history. I will be very brief. In 1944 we eradicated TB on my farm. In 1964, as a junior officer in the NFU, I had the privilege of announcing that we had totally eradicated bovine TB from this country. Since then, of course, history has shown us a different picture. The noble Lord, Lord Knight, posed a large number of questions, and I noted all of them. Those questions were posed more than 10 years ago, and we have gone through that period of time with few decisions being taken. To say, as the noble Lord, Lord Krebs, said, that farmers are dishonest is an insult to the farming community and I cannot accept it. That is not the reason. All the farmers concerned, particularly those who have been held up for 12 years, have been unable to sell one beast off their farms over that time. They do not see this problem as scientists see it; they see it as men who are concerned with the welfare of animals and they do not want to see their herds suffering, as they are doing and have done throughout this period.
My question is exactly the same as that raised by the noble Lord, Lord Soulsby. Surely we have to move towards vaccination. However, if the current vaccine is effective for only one year, that is a very expensive mechanism for doing the job. Surely to goodness we are in an age when an oral vaccine can be found to cope with this situation. It can be put in either the water or the food so that the affected animals are removed. Perhaps that would be a better way of dealing with the matter than the ways that have hitherto been thought of.
Lord De Mauley
I can only say to my noble friend that we are pursuing vaccine options as hard as we can and as a high priority. We have been investing significantly in developing TB vaccines for both badgers and cattle for a long time. I have mentioned a licensed injectable vaccine that can be and is being used on badgers but, as I have explained, it is extremely expensive and needs to be repeated annually. As my noble friend says, we need an oral vaccine, which we are still searching for. We will continue that search and expect to spend another £15.5 million over four years.
Lord Patel
My Lords, the Minister referred to other species that are affected with a similar strain of tuberculosis and specifically mentioned wild deer. Are not mice, particularly field mice, and rats also affected by the same strain and do they not come into closer contact with cattle?
Lord De Mauley
My Lords, the point about mice, rats and indeed deer is that there is no restriction on culling them.
Lord Clark of Windermere
My Lords, I agree entirely with the Minister, as indeed would most people in the country, when he says that this is the most pressing animal health issue facing the country. In the light of that, I welcome the announcement today because I think that it exposes how shambolic the Government’s proposals have been in trying to tackle this real problem. As scientists said last week, the policy was little more than a costly diversion and we will end up with more cases of TB in four or nine years’ time than we have at the moment. The four-year pilots have now, with the stroke of a pen today, become five-year pilots. I believe that we ought to follow the recommendations of the European Union representatives and, although it will not be easy, continue to seek political consensus so that we can move on to vaccination and increase the amount of money that we are spending on research in this field, especially in the form of cattle vaccination.
Lord De Mauley
My Lords, the area in which I disagree with the noble Lord is clearly that of pursuing the cull, which I have said we are planning to do. The area in which I agree with him is that of vaccination, which is another tool in the box that we must find, and I assure noble Lords that we are continuing to work on that.
Lord King of Bridgwater
My Lords, the Minister may be aware that my former constituency was one of the areas that were being considered for this cull. For very many years, including 13 years of a Labour Government, I prayed that positive progress would be made by the Government in tackling this problem. I join the noble Lord, Lord Plumb, in saying that I bitterly regret the very party-political way in which the noble Lord, Lord Knight, intervened in this matter. His Government did nothing effective and left it as a problem to be tackled now. Some have had to live with the personal challenges of the issue—as my noble friend knows, there are suicides, despair and family breakups, so it is not just the financial consequences but the destruction of people’s whole lives that have followed from this. It is also not just dairy herds, which I think the noble Lord referred to, but anybody with cattle. Certainly in the West Country they have faced appalling problems. This should be pursued on an all-party, bipartisan basis, as my noble friend said, not by trying to score points and accusing people of dishonesty in filleting the statistics or anything else. We are trying to get a cohesive approach to this challenge because if we do not, in many parts of the country, it will destroy the whole cattle industry as we see it.
Lord De Mauley
I absolutely agree with my noble friend about the effect on farmers and their families. Perhaps I may do something unusual and come to the defence of the noble Lord, Lord Knight, who began by acknowledging how very horrible this disease is. If I may, I would like to pour a little soothing balm on the political argument.
Baroness Royall of Blaisdon
My Lords, perhaps I may defend the previous Government, who undertook a long series of randomised trials and worked with scientists to try to find a scientific base for future action. Does the Minister accept that there is much relief in the Forest of Dean this afternoon as a consequence of this Statement? The majority of people in the forest, including many farmers, did not want a badger cull that was not based on scientific evidence, was not economic and would not provide the necessary solution to the devastating effect of bovine TB on herds and farmers but that would decimate the badger population. I should add that the police of Gloucestershire are also much relieved to have their leave restored. Can the Minister reassure me that the Government will now use the pause to pursue a firmly scientifically-based solution which will also have a sound economic basis? Will he also agree to update this House regularly so that we can try to find a solution on which there can be some political consensus? We all want to be involved in pursuing that.
Lord De Mauley
My Lords, I have said that we are pursuing all options and I do not think that I can say much more than that. However, I am grateful to the noble Baroness for her offer of help.
Lord Willis of Knaresborough
My Lords, the Minister has rightly referred to scientific evidence, as has the noble Lord, Lord Krebs. It is clear that the scientific evidence that the Minister and his colleagues are getting is different from that which a significant proportion of the scientific community is getting. What reassurance can he give us that an independent group of scientists will be brought together to examine this process transparently and that a regular report will be made to this House, as the noble Baroness said, rather than waiting for another crisis until such a report is made?
Lord De Mauley
My Lords, my noble friend will know that a great number of professionals, scientists and experts are already involved in this process. There is also, indeed, an independent panel which will monitor the results of the cull, and we are extremely grateful for all the advice that we get.
Lord Christopher
My Lords, there have been probably inescapable pressures on farmers to manage cattle as they do. Will the Government also look, among the options, at any evidence suggesting that the resistance of our present herds has been lowered not least as a result of inbreeding? For example, how many bulls are responsible today for our white cattle herds of Holsteins and Friesians?
Lord De Mauley
My Lords, I have heard no evidence that inbreeding contributes to the incidence of TB.
Infrastructure (Financial Assistance) Bill
(12 years, 1 month ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Lord Newby
My Lords, I am delighted to be able to open the proceedings on the Infrastructure (Financial Assistance) Bill. The purpose of the Bill is to help accelerate significant investment in major infrastructure projects and it will increase the number of homes being built and occupied.
Before I set out the main features of this legislation in more detail, I briefly remind your Lordships’ House of the Government’s commitment to delivering a sustainable, private sector-led recovery. This will be possible only by maintaining our credible fiscal stance and so keeping interest rates low. We want to see a recovery that is balanced across industrial sectors and across geographic regions. To achieve this ambition—
Earl Attlee
My Lords, long experience in this House tells me that the best way of handling these events is to allow my noble friend the Minister to lay out his stall and then noble Lords can ask questions at the appropriate point.
Lord Newby
I hope that my speech will answer the noble Lord’s question adequately.
Firms will have access to the communications and transport networks that they need, wherever in the UK they happen to be, enabling Britain to compete on the world stage.
Our national infrastructure plan published last November sets out an ambitious but credible roadmap to deliver on that vision—a pipeline of upcoming investment worth £257 billion in crucial large-scale projects, of which more than two-thirds will typically be financed and delivered by the private sector.
A number of key infrastructure projects close to starting construction are being delayed because of the difficulties they face in securing the finance and investment required, and the housing market continues to suffer from an undersupply of homes to meet the UK’s demographic needs. Even under favourable credit conditions, raising the amount of private finance required to deliver these projects and to meet our overall infrastructure investment goals would be a challenge. However, the disruption caused by the instability of international financial markets and the adverse effect that this is having on long-term debt provision have not abated. Proactive, decisive action by the Government is therefore needed now. The Bill will allow us to take that action and will bring forward the investment needed.
The principal aim of the Bill is to make investment in major infrastructure and housing schemes possible. The Government have agreed in principle, subject to strict approvals criteria, to make financial support available to infrastructure projects using the strength and credibility of our balance sheet to support the investment that we need.
Through this Bill, guarantees provided by the Government will help to ensure that where projects are struggling to access private finance due to adverse credit conditions, these projects can now go ahead. It authorises the Treasury and, where appropriate, other Secretaries of State to incur expenditure necessary for providing financial assistance.
The Bill will allow the Government to support crucial investment in key areas of economic and public service infrastructure: utilities, such as energy and telecommunications; transport, such as railways and roads; infrastructure to provide public services, such as hospitals and schools; and housing development to deliver much-needed homes.
The Treasury estimates that up to £40 billion of investment in infrastructure and an additional £10 billion in housing investment could be accelerated under the guarantee schemes using the powers in the Bill. Importantly, we will put in place strict guidelines and eligibility criteria for the schemes to protect the taxpayer and ensure that the Exchequer does not take on unacceptable fiscal risks.
Any proposal that receives a guarantee from Infrastructure UK will as a minimum have satisfied the following requirements. It must be nationally and/or economically significant; financially credible; good value for money for the taxpayer; not solely dependent on a guarantee to proceed; and ready to start construction within 12 months. Any proposal that receives a housing guarantee from the Department for Communities and Local Government will, as a minimum, need to deliver an agreed number of new homes; undergo an investment appraisal and full due diligence and be subject to ongoing monitoring requirements; meet a risk capital contribution at the outset; and provide recourse to the secured housing assets.
Since the projects that we expect to back will be structured to minimise the potential losses to the Exchequer, there will be minimal impact on public sector net borrowing as a result. The exception is under the extreme circumstances that a guarantee is called upon or other forms of financial assistance are provided, but we expect such circumstances to be rare. Furthermore, the Government will levy a commercial charge. This will cover the services received by infrastructure providers and beneficiaries of the private rented sector housing guarantee. It will ensure that companies pay a fair price for the benefits that they receive, and that taxpayers receive a fair price for any risk being taken. It will also ensure that schemes do not fall foul of EU state aid rules.
The Bill raises a number of questions. The first and most fundamental is: will it work? Is there any evidence that the guarantee being offered will really facilitate the speeding up of infrastructure projects? There is already substantial evidence that it will. Infrastructure UK has received some 60 enquiries from projects that might qualify, and more are expected. There is also strong interest across the housing sector. Negotiations on these projects are ongoing so it would be inappropriate at this point to run down a list but, as an example of the kind of thing that is likely to benefit, we have indicated that the Crossrail rolling stock and depot services procurement meets the eligibility criteria.
A number of people have asked why the Bill is necessary at all. Can the Government not already do this kind of thing without explicit legislative cover? The Treasury and Secretaries of State already have common-law powers to make guarantees, make loans and give other financial assistance. In addition, some Secretaries of State have express statutory powers to support infrastructure. However, the Treasury does not have the authority to incur expenditure in relation to guarantees on the scale that I have outlined. Moreover, there is a longstanding convention—
Lord Peston
The noble Lord was kind enough when I asked him why we needed a Bill to point me to an answer given in the other place, which I have to tell him I found completely incomprehensible. I am still stuck. Will he say in terms that we need a Bill because of the scale of the operations? Is he willing to place on record that that is the point and it is the size of the operations which requires legislation? I find that very odd but at least I would like to hear him say it.
Lord Newby
It is partly the scale of the operations and the length of the guarantees, and also because the current rules have gaps in them, as I understand them, or there are certain parts of the whole infrastructure world, as it were, that are not covered by the existing rules. To finish my sentence, there is a longstanding convention known as “Baldwin cover”, dating back to 1932, that Governments should not rest significant and regular expenditure under common-law powers on the sole authority of general supply legislation. That is the noble Lord’s point. It is significant and regular guarantees, not expenditure, that could have a very long period of operation.
Questions have also been raised about what kinds of project can potentially be covered by this legislation. In particular, the Institution of Civil Engineers has asked about what constitutes a nationally significant project—a phrase that does not appear in the Bill but did appear in last year’s national infrastructure plan. I should make it clear that projects that could potentially benefit from this Bill are not limited to the nationally significant projects identified in the national infrastructure plan. In addition to the areas covered by the plan, we will be prepared, for example, to look at waste management and university projects that are economically viable and simply want for finance. As to the scale of project that can potentially benefit, again there is considerable flexibility. A project does not necessarily have to be valued at several hundred millions of pounds to be considered.
The Bill is one part of the Government’s overall approach to ensuring that the United Kingdom invests in the infrastructure that it needs for the future. I look forward to our debate today and I commend the Bill to the House. I beg to move.
Lord Adonis
I am very grateful to the Deputy Chief Whip for explaining the Bill and I am delighted to be debating with the noble Lord for whom I have the highest regard. I am also very glad that Paul Deighton is to become Minister for Infrastructure. It was specifically to shadow him and his vitally important work that I have returned to the Front Bench and I much look forward to engaging with him. I understand that Paul Deighton will not be joining the Government until January so this is an unusual, if not unprecedented, case of the shadow materialising three months before the substance, which sort of sums up the Government’s infrastructure problem: all shadow, no substance.
If I can continue the metaphor, this Bill is one of the most shadowy I have ever seen. Its four clauses simply give the Government power to spend up to £50 billion on infrastructure in very broad areas—water, electricity, gas, telecoms, sewerage, railways, roads, health, education, courts, prisons and housing—with little indication in the Bill or in the debates in the House of Commons beyond a single announcement about Crossrail trains of what real infrastructure projects it is intended to assist and when.
The Minister did not enlighten us much further, saying that,
“it would be inappropriate … to run down a list”,
which is a phrase redolent of Sir Humphrey at his very best. Our consideration of this Bill is a mere shadow since it is a money Bill which we cannot amend or even debate amendments to. However, before this phantom passes into law, I should like to set out some issues for debate and would be grateful for the Minister’s response.
In 2009, expenditure on infrastructure was at the highest real-terms level for about two decades. Three years later, the Construction Products Association is warning that infrastructure is in free fall. It is expected to decline by 13% this year compared to last. The CPA is projecting even bigger falls in key sectors—for example, a 40% drop in road construction this year—not least because of the coalition’s wholesale cancellation of road schemes in 2010. Will the Minister confirm these figures and tell us whether, in retrospect, it was wise to cancel essential schemes of national importance such as the dualling of the A14 east-west route from Felixstowe port to the Midlands and the dualling of the A21, a key route from London to the Kent and Sussex coast?
In the case of the A14, this project has now resurfaced as a proposed toll road. My officials told me that tolling of the A14 was unworkable when I was Secretary of State, but the coalition clearly has a higher source of wisdom. So, could the Minister tell me, first, whether the Government are considering a state financial guarantee for the privately financed A14 project, as it will surely need one; secondly, what tolling scheme is proposed, because I can find no reference anywhere to a scheme that appears even vaguely workable; and thirdly, when the tolled and dualled A14 will be open? If the work had gone ahead as a conventional road scheme in 2010, the opening would be taking place in stages from now. The only reference that I can find on the web is to a tolled scheme that will open from 2018.
Equally concerning is the delay and prevarication over energy policy, which is holding up investment in new infrastructure, including the £210 million Siemens investment in a wind turbine factory in Hull and huge investment in new wind farms and renewable energy. There are big delays, too, in rolling out superfast broadband and 4G. When I was on the Norfolk coast earlier this month, visiting Statoil’s new Sheringham Shoal offshore wind farm, a particular concern was the lack of fast broadband and the poor quality of mobile phone reception. Britain’s lack of 4G mobile phone provision is pushing us behind the United States, Germany, Sweden and parts of Asia. As for broadband, the Country Land and Business Association recently described the superfast broadband situation as lamentable saying:
“It is becoming clear that the Government’s strategy will not meet the target date of 2015”.
The shadowy case for this Bill is that it will help unlock the capacity of the private sector to invest in infrastructure, but it is important to understand that a critical obstacle to infrastructure investment is the Government’s own failure to lead and deliver.
I mentioned road schemes a moment ago. It is the same story with airport capacity in the south-east, where the Prime Minister has just appointed a review which is going to take three years. It is now three-and-a-half years since the previous Government announced their decision on airport capacity in the south-east. In the House of Commons, the Economic Secretary to the Treasury said that any decision on airport capacity would be taken by the next Government. In other words, this Government have given up. If I may say so, that is one of the most brazen abdications of responsibility that I have ever heard from a Government.
It is the same story on HS2—another project that I know intimately—where dither and delay since 2010 have put the project back by at least two years and may again delay the key decisions until the next Government. It is a similar story too in London, where one of Mayor Johnson’s first cuts in 2008 cancelled the desperately needed Thames Gateway Bridge which would have provided another Thames crossing in east London, for which both planning and funding were already secured. Instead, all we have is a new cable car offering a tiny fraction of that capacity and—you could not make this up—the beginning of a planning process which might ultimately lead to a new bridge not far from the one which was cancelled for short-term political reasons. It is the same story now with the extension of the Northern Line to Battersea, a key development area. In June, a Treasury source told the Evening Standard:
“The entire weight of the Government is being thrown behind the extension of the Northern Line”.
Now, Transport for London can only say:
“Subject to funding being in place and permission from the Secretary of State for Transport, the new stations could be open by 2019”.
So much for transport, energy and broadband. Let us look at education. One of the Government’s first acts in 2010 was to slash to ribbons the school building programme. If that had not happened, hundreds of schools would be being built or refurbished as we speak, pumping billions into the construction industry and providing modern school premises which will now have to be built at far greater expense hereafter. It is the same story too with housing. The number of housebuilding starts fell by almost a quarter between March last year and March this year, with starts by housing associations, in the quasi-public sector, down by a similar proportion.
I have always taken it as a golden rule that the state should not preach to the private sector until it has got its own act together. Well, let us be clear: we are now confronting a situation where the state itself has slashed or delayed infrastructure spending across the board, and failed to agree planning decisions for key privately funded infrastructure projects, while deploring delays in the private sector. That is not leadership, but complacency masquerading as concern.
It is not just on investment that the state is failing to lead. The Government talk constantly about reducing planning delays, something which is within the power of the state to determine. Yet I note that last year only 60% of major planning applications were processed within the target date of 13 weeks, a big reduction on the 68% determined within 13 weeks in 2010.
Turning to the national infrastructure plan, which the noble Lord said was “ambitious but credible”, I note that in the latest reissue, 63 projects have disappeared without explanation from the 2011 plan—I assume that they were ambitious but not credible. Of the 357 projects in both the original plan and the updated version published this April, almost two-thirds were in pre-procurement stages. Only 38 had proceeded to procurement or construction. More than 300 projects in the national infrastructure plan therefore are still mere shadows, and 63 have vanished into thin air. Honing down to the most important projects, the British Chamber of Commerce identified 13 critical infrastructure projects before the last election. There has been little or no progress on eight of those 13.
Will the Bill help with any of this? It entirely depends what the proposed assistance is going to be used for. The Bill simply says that the Government may provide any kind of financial assistance up to the absolute limit of £50 billion. The only further limitation suggested by Ministers is that projects should be of “national significance”, a definition which looks to be in the eye of the beholder. Will the Minister give us just a few examples, beyond Crossrail trains, of projects which will now go ahead through the proposed guarantees to the private sector, as the CBI has said that we need urgent action from Ministers to identify further projects?
Will the Minister also give us an indication of when the first project financed under this guarantee scheme will actually go ahead? When the Crossrail trains announcement was made, the Financial Times said:
“The government appears to have relaxed one of its key criteria for guarantees—neither the super sewer”—
another possible project for this scheme, funding for which is apparently stuck in the Treasury—
“nor the Crossrail rolling stock schemes will be ‘shovel ready’ within 12 months”.
Will the Minister tell us about the relationship between the Bill and the Growth and Infrastructure Bill, which was published last week? The Bill was supposedly going to unlock a string of major infrastructure projects. Now, before it is even enacted, another appears whose Explanatory Notes state that its purpose is,
“promoting growth and facilitating provision of infrastructure”.
There are to be yet more changes to the planning system intended—and have we not heard this before?—
“to enable applicants to avoid delays in local decision-making”,
while respecting localism. The next Bill also includes changes to the infrastructure financing regime, which overlaps directly with this Bill: for example, removing so-called unviable Section 106 agreements for affordable housing.
The CLG blurb accompanying the Growth and Infrastructure Bill states that those further changes could:
“Unlock investment decisions across a range of technologies, bringing thousands of new jobs and billions of pounds of investment”.
Those are almost precisely the same words used to justify the present Bill and a host of other initiatives over the past two years, each of which has been succeeded by another intended to achieve precisely the same objectives before it has even been enacted, let alone implemented. They are also the justification for the regional growth fund, only a tiny fraction of whose allocated funds have yet been released to businesses, as catalogued in the highly critical report from the Public Accounts Committee.
I have asked a lot of questions, and I entirely understand if the Minister writes to me about those to which he cannot get answers by the time he replies. I fully recognise that it may take longer than two hours —perhaps two years or even two centuries—to come up with a viable scheme for tolling the existing A14.
Let me end on a broader note. When the Bill was debated in the Commons, the Economic Secretary to the Treasury said that it would,
“facilitate headline schemes for infrastructure and housing investment, accelerate and bring forward investment in major UK infrastructure projects and increase the number of homes being built and occupied”.—[Official Report, Commons, 15/10/12; col 121.]
Those are fine words, but what we need now is action. At the moment, we are simply chasing shadows.
Baroness Gardner of Parkes
My Lords, I am glad that infrastructure is defined in Clause 1(2), as it is a word that has such a wide meaning and without it I would not feel entitled to speak on the Bill, because I do not have expertise on the financial aspects of it. Guarantees are of such importance and relevance at present, when we need jobs to be created. I believe that the guarantees under the Bill will enable works presently delayed to be carried out so that they will be of benefit both to the nation and to individuals. My comments will be directed towards subsection (2)(e), housing, which will also automatically involve subsections (2)(a), because of the linkage of services, and (2)(b), roads and transport.
For a good many years, until I reached their retiring age, I was a vice president of the National House Building Council. I hold it in high regard and it provides an excellent service for small builders and individuals. When I had to rebuild my own home in the 1980s—sadly, it had split asunder due to subsidence—I valued the security provided by its guarantee, which I believe covered the first 10 years after construction.
Later, I learnt of the wide support that it gives to the home building industry and I know that it plays a very necessary part in the provision of homes which are again so badly needed. Awards were given annually to various categories, such as small builder of the year, rather like a mini-Oscar ceremony. I hope that the NHBC will, among others, encourage builders to produce commonhold developments. It is time that we got rid of the antiquated leasehold system for residential property, which exists only in England and Hawaii, I believe.
In the Housing Reform Act 2002, we introduced commonhold, but it has hardly been used at all. I believe that the main reason is that developers prefer to make more money by selling the freehold to one body and the leasehold to another. That means that owner-occupiers, particularly in blocks of flats, have little or no control over the work carried out on their properties or the costs of them. I am sure that your Lordships are aware that I have spoken about leasehold reform many times. I still have my flat in Australia, where our commonhold is called strata title. Under that system, all flat owners are members of the body corporate and all decisions about the block are made collectively. I am convinced that once a reputable company such as Persimmon—and lots of others—builds and sells one commonhold block, it will see how popular and effective the system is; once it takes off, there will be no turning back. Getting the advantages known to the public will prove the value to home owners.
In our 2002 housing Act on this matter, there is provision for leaseholders in existing blocks to apply to convert to commonhold, but the provisions of the Act make it almost impossible, as 100% of leaseholders must agree. Apart from the fact that more often than not one owner is not contactable, it is open to abuse by any superior landlord not wanting to change. They need to buy out only one person’s vote to secure retention of the property for the superior landlord. Would it not provide a wonderful example if the Government were to support commonhold as the choice of tenure for the buildings to be converted to residences on the former Olympic site? This would provide a real legacy for the Games.
Returning to the wider issues of housing, we are all aware of the desperate need for more housing. Finance has been in short supply and mortgages have been almost unobtainable. Small builders cannot employ staff or begin construction unless they are sure of financial backing. From the comments of the noble Lord, Lord Adonis, I thought that the flexibility in this scheme should clearly mean that small builders can be supported in the same way as anyone else; it does not have to apply only to huge construction firms. Many of these small builders have huge skills and capabilities.
A lot of noble Lords will remember the late Lord Taylor. He told me that his career began when he built one house—I think in Liverpool. Selling that house provided him with the funds to build two houses and he went on to head Taylor Woodrow, which was a great achievement for him and a wonderful example for anyone looking for a future in the industry. We should not overlook that; we should support small builders who are ready and able. I like the expression “shovel ready” used by the noble Lord, Lord Adonis, and builders are shovel ready and often desperate for work at the moment. If they cannot employ staff, they cannot get going.
There is another aspect of housing on which I must comment. At present, there is a great argument about green belt and non-green belt land. I made this point during the passage of the Localism Bill, but consider it worth repeating in the context of this debate and all recent debates on the subject. There are small pockets of land in so-called green belt land that are sited in the midst of fairly built-up areas. These infill sites already have all the infrastructure in place and homes could be built on them without the delay of waiting for services, such as power, roads, and so on. This would mean that builders could get working much more quickly. Naturally, whoever owns the adjoining house will not want new neighbours, but nimbyism is not to be encouraged. Providing the new build is in harmony with the neighbours, it would rapidly become acceptable.
Reading page 3 of the Library note on this Bill today, I was disappointed to see the negative comments from the Opposition in the other place. To speak as pessimistically as Rachel Reeves did for the Opposition—in col. 689—is most disturbing. Surely we should all welcome this hope of producing not only more jobs, but also more homes. All parties must surely support the principle of this Bill. To oppose it, which in fairness she said she would not, would be to kill off hope for people who would definitely benefit if this finance made the difference between action and no action on infrastructure.
I can better understand Nick Raynsford’s remarks about “deep scepticism” and his wondering whether the Bill will deliver all that is expected of it. We have heard similar comments from the noble Lord, Lord Adonis. We all hope that it will deliver, but no one can know these things for certain. Without this Bill, I believe there is no hope for this necessary progress. It is a money Bill and I understand the significance of that, but I do not mind speaking on it. It is not something that we have any right to do anything about. We must go ahead with this financial assistance scheme; we must look to the Government to ensure that the money is put to good use to provide homes, systems, schemes and developments to the benefit of those needing work and homes.
I found many of the comments made by the noble Lord, Lord Adonis, very interesting, such as his comments on toll structures. I have just come back from Australia, and I was very interested to see how well the toll roads work out there. Whether they are appropriate for here, I do not know. That is not my field of expertise. The noble Lord said that things have not progressed but perhaps this Bill will help them to progress. We have to look at this positively and go ahead with this action by the Government. The important thing is that the money has to be spent wisely on guarantees. No one seems to be able to get a guarantee now from a bank for pretty well anything, particularly for major projects but also for small projects. My appeal today is that we try to help small builders to get going so that homes can be built immediately for those who desperately need them and so that builders can provide employment. I support the Bill.
Lord Desai
My Lords, as I came into the Chamber this afternoon, I was told that I had missed the U-turn on the badger cull, but I am glad that I am here to see the U-turn on the Treasury’s economic policy. Unlike the badger cull, it is as if only some badgers are not going to be culled, but others will be. It is a very minor regression from their policy by the Government. I guess it will do no harm to spend £50 billion doing something, although I still do not quite understand why it is necessary.
There are two problems. The Government’s economic case—I thought I was one of the few people who understood it—was that they would withdraw from spending money because we do not have any money, which is fair enough, and the private sector would take over investment. The private sector is flush with money. There is absolutely no shortage of funds in the private sector. The balance sheets of private corporations are very generously funded. Therefore, if these infrastructure projects cannot get money from the private sector, one needs to know what the market failure is. If the market failure is that the Government should have been spending this money anyway, why are we doing it? If the problem is that the Government have to spend money because projects will not be funded by the private sector, I understand that. I grew up with that argument and have no problem with it, but in that case, £50 billion is not enough. As my noble friend Lord Adonis pointed out, there are many more things that could be done.
The Government are not doing that, but are doing this. I still have not seen an intellectual case or any evidence that significant numbers of people are unable to get money, although it may be the case. One reason could be that people need some kind of pump-priming investment so the Government have to start something for other people join in. The Government have to show some confidence in the long-term prospects of the economy by, for example, starting a third runway, upgrading the A14 or whatever, and then there would be supplementary investment. But this says that the Government will not do anything except stand there because in 1932 Baldwin prevented the Government doing it. I find it very surprising that the Government cannot do this in any case, but that is a bureaucratic thing, a regular Treasury thing, and so I will never understand it.
I find it intellectually impossible to understand why it is being done now, why, if it is being done now, it could not have been done two years ago and why a much more ambitious scheme could not have been done many years ago. Why have the Government waited two years and had a massacre of infrastructure projects before we got to this? Lastly, have the Government any idea whether this is going to work? I still do not know which projects are stuck because they cannot get a bank loan. If they cannot get a bank loan, is it because the project will not make money? If that is the case, is the taxpayer about to lose more money than before?
Baroness Maddock
My Lords, I always enjoy the contributions of the noble Lord, Lord Desai. I declare an interest as a vice-president of the Local Government Association. This is an important Bill, particularly for housebuilding, which is what I shall concentrate on. It was interesting that Radio 4 yesterday morning highlighted rapidly rising rents in the private sector and highlighted one of the reasons for this—the shortage of homes that we face in the United Kingdom. Housing is a vital part of our United Kingdom infrastructure. Not only does housebuilding help to boost the economy, particularly the construction industry—a point made by my noble friend Lady Gardner—it also solves a number of other significant social problems, including social housing waiting lists, high rents, the affordability of homes for first-time buyers and overcrowding, which is becoming acute in housing in this country. However, despite this, the coalition Government inherited a housing crisis in May 2010.
Under successive Governments, the number of homes being built has been declining. In particular, social housing stocks have been extremely badly hit. The coalition Government are committed to building more homes. We have already said that we expect to build 170,000 new social homes by the end of this Parliament. However, while the Government are investing state money in many of these projects, there is also a real need for support for private developers to get housebuilding projects under way, a point made by my noble friend Lady Gardner of Parkes. The Bill will allow the Government to provide loans, guarantees and other financial support for infrastructure of up to £50 billion. As I understand it, £10 billion of this could be used to support housebuilding.
One of the problems of our housing infrastructure is its age. Very many of our houses were built in the last century, the century before and even before that. This means that our housing stock is incredibly energy inefficient and this does not help other matters that we are trying to deal with in reducing our carbon emissions. We just do not have enough houses. As I understand it, in 2011 390,000 families were created, but we managed to provide just in excess of 100,000 new homes.
The previous Government, despite the wide-ranging but scathing opening remarks of the noble Lord, Lord Adonis, did not do a lot for housebuilding. Housing construction—perhaps it was not all due to the previous Government—actually fell off a cliff during the financial crisis. In 2008-09, fewer than 100,000 new properties were started. Although the number has increased since then, we are still a long way off building enough new homes. I understand that the revised figure for 2011-12, as I mentioned earlier, is something in excess of 100,000 properties. Despite this positive news, a far higher percentage of these new starts were public sector-led, either by housing associations or local government, than were privately funded. In 2010-11, 24% of constructions were publicly financed compared to between 9% and 13% in the decade before.
The noble Lord, Lord Adonis, did not talk too much in his opening comments about his own Government’s record on housebuilding. During 13 years of the Labour Government, the social housing stock fell by well over 400,000. Although they had ambitious targets, they did not meet them in the 13 years. In fact, they consistently failed to meet their social housing target and, in their last year of office, they missed it by 78,000.
The lack of social housing and delivery of new private sector housing has led to a number of very serious consequences. Average house prices in January 2012 were estimated to be under £200,000, and for those of us who spend our time in London, we know that here—and particularly in Westminster—the position is even worse. This is an increase in the past decade of almost 70%. An average of 21,658 properties has been deemed to be overcrowded at any one point in the past three years. The lack of supply has also meant that homes cost more to rent. The mean rent of the private rented sector in 2010-11 was £160 a week, and that has risen considerably, leading to very large bills for housing benefit. That bill has increased from £11 billion in 2000-01 to £21 billion in 2010-11. If we look at other figures to do with the private rented sector, which is where a lot of people have to find their homes now, because we have not built so many social properties, there has been an 86% increase in working families claiming housing benefit. We now have more than 400,000 people receiving housing benefit. What is more worrying is that we have another 10,000 applying for housing benefit in the private rented sector every month. The total number has risen by 37% in three years. We can see why it is important that we find some way in which to support the construction of more homes in our country.
I shall spend a very short time on the area I come from, the north-east of England, where housebuilding numbers have suffered greatly since the financial crisis. They have slightly improved on the latest figures, but again in the north-east it is housing associations and local authorities that have taken up the greater number of starts. That shows a real need for more support for private sector housebuilding.
I have spoken on housing matters in this House for more than 20 years and in that time housing has never been really high up the political agenda. For many years we have not had a Housing Minister sitting around the Cabinet table, which is one reason why housing has been a little bit down the agenda. Instead of having its own department, it has been part of another, now called the Department for Communities and Local Government. In my time in Parliament, that is the fourth name for that department. It is not one of the highest performing departments, yet housing and housing infrastructure is such an important part of what happens in our country and in our economy.
I am very glad that the Government have brought forward this Bill. If there are technical details about why we could not do it before, that is a good reason to have it. We need to do all we can—and personally I want to see greater progress in the number of homes keeping up with the number of people and in building homes that produce less carbon. I give my support to the Bill.
Lord Giddens
My Lords, I hesitate to disagree with two distinguished professors of economics from the same institution as me, the London School of Economics, and with my noble friend Lord Adonis. Actually, I do not mind; it is good to have a bit of controversy in these debates, even from the same side of the House. Anyway, I feel more positive about this Bill than they do.
To me, the Bill is quite interesting, set against a background of previous government policy and the Government’s previous approach to cuts. It seems to mark something of a move away from the Government’s formerly—if I may say so—somewhat primitive approach to cuts, which everyone accepts have to be made. In many areas the Government have looked for cuts in a simplistic and even counterproductive way by not analysing their knock-on consequences. As a result, we do not even know in some important areas whether the cuts that are made truly are cuts.
I will give an example from the sector that I know best, the university sector. In this country we have a number of world-class universities. However, the consequences for the economy of the Government’s migration policy are very debatable. I have looked at the figures provided by the country’s main university groups, and it seems to me that these measures have cost the country money, not saved it. If you do not look at knock-on consequences, you simply do not know what a cut amounts to.
It is also very important to say that the obverse applies—renewed investment does not necessarily imply more borrowing, even in the short term. Again, it depends wholly on the economic consequences for jobs, revenue and demand. Whatever the limitations of the National Infrastructure Plan 2011, it seems to make clear that infrastructure spending can have a multiplier effect on productivity, employment and demand. The Government should always seek to balance these things when looking to produce a more effective system of savings and growth for the economy.
Infrastructure investment is a key area for other reasons. The professor at Oxford, Dieter Helm, a writer I much admire for his work on energy and infrastructure, has recently edited what seems to me to be the definitive book on British infrastructure, which rejoices in the sexy title of Delivering a 21st Century Infrastructure for Britain. I do not know how many copies it will sell but it is a pretty good book. He makes the point forcefully that not many businesses would want to locate in the UK because of its infrastructure which,
“is not fit for the digital age and much of it is very carbon-intensive”.
It depends which ranking system you chose but in the most well used one, the Competitiveness Index, the UK ranks only 24th in the world for competitiveness in the area of infrastructure. The outgoing Labour Government must shoulder quite a bit of the blame for this situation. Even though I am a Labour supporter, the Labour Government’s record—my noble friend Lord Adonis will forgive me—in transport, energy and housing was not impressive.
I have four questions to ask the Minister. I know that he is going to want to reply to the bombardment from the noble Lord, Lord Adonis, but he might perhaps spare a bit of time for my pathetic little inquiries. First, infrastructure is a very wide category and the Bill makes it open to a diversity of investors. How will balance be achieved if too much funding concentrates on certain areas? How will priorities be determined? There is a lot on priorities in the national infrastructure plan but I cannot see the relationship between that and the Bill at the moment, especially if it is driven too much by who is actually prepared to stump up money rather than by an overall plan.
Secondly, the Government claim initial successes for their pension infrastructure platform but the problems of linking pension funds to infrastructure investment are well known. Only 1% of pension funds globally are invested in infrastructure projects—for good reason, as there are often high risks in the early stages of such investment and pension funds are not normally geared to such risk-taking. How will the Government confront this issue?
Thirdly, and importantly, where will the burden of risk end up? As these are long-term projects, will the burden of risk in the Bill end up with the public sector in most cases, and therefore will they, as I said earlier, involve far greater cost to the public purse than might appear in the system that is set out?
Fourthly, energy is mentioned often, but what will be the relationship between this Bill and the new Energy Bill, which I believe will be published next month? At the moment energy policy seems to me, and I think to most people in the industry, pretty chaotic, with the Prime Minister saying one thing and other Ministers saying something else, with the Treasury apparently holding different views from the Department of Energy and Climate Change. Do the Government recognise the need for at least a 20-year planning cycle for core energy supplies? Does this not imply getting well away from a strategy based largely on short-term market fluctuations? In other words, I do not see from this Bill and the plan how long-term planning is to be achieved. We know that it cannot be achieved by the methods of the 1960s and that it is difficult to plan on a long-term cycle when technological innovation and other innovations are inherently unpredictable. Planning there must be, though, and the Government should devote a lot more attention to what form this will take if their interventions in infrastructure are to be at least a little bit more successful than the noble Lord, Lord Adonis, thinks is possible.
Lord Skidelsky
My Lords, as someone who has never been averse to having a go at the Chancellor of the Exchequer, I start by saying how idiotic and puerile it is for newspapers to make a lead story of which ticket he used for his journey from Chester to London. It is George Osborne’s stewardship of the economy, not his travel arrangements, which deserves censure. However, we have an infantile press.
Three big mistakes stick out over the past two and a half years. The first was the belief that cutting down government spending would automatically produce recovery. I know the Government now claim that they never believed anything so simple or idiotic, but they did, and there is plenty of evidence to prove it. Austerity is not a recovery policy.
The second has been the Chancellor’s failure to distinguish between current and capital spending. This has made the deficit seem more dangerous than it was. The prime example of this blind spot was the £50 billion cut in capital spending. The noble Lord, Lord Adonis, has drawn attention to the devastating consequences of this for the construction industry and for house, transport, education and hospital building.
The third was the Chancellor’s belief that without a severe fiscal contraction Britain would go the way of Greece: that is, interest rates would go through the roof. This was doubly wrong. First, with an independent central bank able to buy government debt in whatever quantities were needed there was never any chance of gilt yields rising to the levels experienced by Greece, Portugal, Ireland and Spain. Secondly, and perhaps even more importantly, a reduction in the cost of government borrowing is no guarantee of a reduction in the cost of commercial loans sufficient to offset the collapse of the private demand for loans. That is the explanation of a point mentioned by the noble Lord, Lord Desai, regarding cash mountains sitting in corporations.
All three mistakes were interrelated parts of the wrong theory of the economy. Anyone who is interested in economics must start the analysis there. I am not going to go into it, but it is well known to those who are economically literate. The results have been zero growth since George Osborne took office. That was entirely predictable and was predicted by some of us. I have been saying for two and a half years—and I am not alone—that austerity would not produce growth and it has not produced growth. Now the international agencies are saying the same thing. Slowly but surely, the Government are being driven to plan B, though the Prime Minister prefers to call it plan A-plus.
It is against that background that I give a cautious welcome to the proposals in this Bill. Better late than never, better too little than nothing at all. As I understand it, the Bill aims to do three things. First, it provides for the Government to guarantee up to £40 billion or £50 billion of “nationally significant” private infrastructure investments which have to be ready to start within 12 months of the guarantee. As the Treasury explains it, the aim is,
“to kick start critical infrastructure projects that may have stalled because of adverse credit conditions”.
That is Treasury language. The guarantees might cover key project risks such as construction, performance or revenue.
Secondly, the Government will lend money directly to private investors to enable 30 public/private partnership projects worth £6 billion to go ahead in the next 12 months; I do not think that has been mentioned yet in the debate. Finally, a £5 billion export financing facility will be available later this year to overseas buyers of British capital goods; in other words, an export credit guarantee scheme of the type we are all familiar with. I would like to reinforce what the noble Lord, Lord Adonis, said. Having cancelled about £50 billion of certain public capital spending, the Government are hoping to replace it with an equivalent amount of private capital spending, much of which will never happen. That is completely illogical.
The main difference between this Bill and the British investment bank, which I have been urging, is that my bank—I call it “my bank” because I feel a certain sense of paternity in the idea, having been floating it for the last three years—would actively raise money in the private markets for its own investment projects whereas UK Guarantees, the government scheme, merely provides some finance for projects initiated by the private sector. In other words, the government scheme is still governed by the ideology that the private sector is more likely to pick winners than a state investment bank and that that is sufficient justification for waiting for the private sector to produce its projects.
Lord Peston
My Lords, the logic of what is being said is not that it is more likely to pick winners but that it already has all those winners. The only things holding them back are the risks of the projects which the taxpayer is taking over. It is a new theory to replace classical economics which—as the noble Lord well knows—says savings cause investment. Now we have loan guarantees causing investment and it is just as nonsensical as a serious piece of economics.
Lord Skidelsky
The noble Lord is quite right. The argument can be developed, but my point about picking winners and losers is that there is no empirical evidence for it being true, as a general proposition, that the state is more likely to pick losers than the private sector. We have had many examples of that not being true. The economic collapse of 2008 is a very good one.
Lord Giddens
Would the noble Lord accept that there is actually evidence that the state is quite often better? If you look at the history of energy industries and most technological innovations, they have normally been kick-started by government investment. This applies to all the major technology that has transformed our lives over the past 20 or 30 years.
Lord Skidelsky
I am happy to accept that. I was making a more modest claim.
A mere guarantee for privately initiated schemes is bound to be less successful, apart from in the efficiency of the schemes, at securing the required volume of investment than a commitment by the Government to a definite infrastructure programme. So while I wish UK Guarantees well, a certain amount of scepticism is in order.
In the final part of my speech, I want to consider what is happening to the economy. When an economy is crawling along the bottom, any small wave is likely to lift our spirits. Over the past three quarters—that is, the past nine months—the economy has shrunk by 1%. Even if, as now expected, it achieves a positive growth of about 0.8% this quarter, that still leaves it in roughly the same place as it was a year ago. Moreover if, as commentators suggest, this boost is due to the Olympics, it will be in the nature of a windfall. However much we may rejoice in the achievements of our athletes, 28 gold medals is not enough to turn the British economy around.
However, there is still a puzzle, which is that unemployment has been static in the past few months, and even falling slightly, despite the fact that output is flat and the economically active population has increased by 550,000 over the past two years. You would therefore expect unemployment to have increased. Why has it not done so? That is the puzzle. There are several possible explanations, none of them conclusive, because the facts necessary for a convincing answer are buried in a labyrinth of tricky statistics and slippery definitions. It may be that employers have been hoarding labour, but that becomes less plausible the longer the recession goes on. Part of the answer at least must be that productivity—that is, output per hour worked—has been falling. As the Guardian put it,
“it now requires many more of us to labour away to churn out the reduced volume of stuff”.
Falling productivity is just as serious a problem for the economy as rising unemployment, and a greater problem in the longer term.
The Prime Minister claims that 900,000 extra jobs have been created in the private sector over the past two years. I never know how many it is—sometimes it is 900,000 and sometimes it is 1 million; it goes up every day, but I am sticking to the 900,000 figure for the time being. That is not of course the net increase in jobs, given that 400,000 jobs have been lost in the public sector. The net increase in jobs has been 500,000. Can the Minister, the noble Lord, Lord Newby, tell us how many of the net gains in employment are full-time? Labour market statistics suggest that more than half of them are part-time or self-employed. Can the Minister also say whether those registered on government work programmes count in the Prime Minister’s extra 900,000 private sector jobs? The point is this: if a lot of the private sector job creation consists of part-time low-skilled jobs at the bottom end of the service sector, it would explain the decline in productivity that limits the rise in unemployment, but it is a poor omen for that vibrant, high-value economy that is supposed to secure our future prosperity.
I wish the Government well in these plans because I wish the country well, but we will need much more solid evidence than we have seen so far to believe that we have turned the corner and started to repair the damage of the past two and a half years.
Baroness Wheatcroft
My Lords, I will return to the narrow interpretation of the Bill, which is about infrastructure rather than employment figures. We all know that this country needs investment in our infrastructure which is second class. Our housing stock is too small. The Government are trying to address these problems. The Bill is a welcome contribution, although it is just one of many measures now being implemented, as the noble Lord, Lord Adonis, pointed out. However, as I listened to him and to the noble Lord, Lord Skidelsky, and their criticism of projects postponed, I had to disagree. The noble Lord, Lord Skidelsky, may well term me an economic illiterate, but it was right to postpone these projects because it was a simple matter of the accounts.
When the Government came to power, they were faced with a dreadful deficit, and their priority, quite rightly, was deficit reduction. However, not only were they seen to be reducing the deficit, but they had to persuade the financial markets that they were serious. Clearly, they have succeeded in persuading them of that and that is why we have the ratings we now have. Under the previous Government there was much talk about prudence, and prudence with a purpose, but profligacy was the reality. We now have a more prudent approach, and it is only because of that approach that the Government are now in a position to bring forward the scheme in this Bill.
We heard much talk from the noble Baroness, Lady Maddock, about the rise in rents and the problems that this is bringing to housing benefit. Providing housing benefit for those who cannot meet their rent now costs taxpayers almost twice as much as it did three years ago. We cannot afford that bill, let alone more. We need more affordable homes to rent and we need to enable those who want to own their own home to get a foot on the housing ladder. This Bill will help by giving backing to those who will provide the new homes. However, our needs go far beyond housing. If we are to compete as an economy, we must make long-overdue improvements to our road and rail networks, to our energy supplies, and to our airports. We cannot wait too long for that.
This Bill pledges some useful support for projects that need a helping hand, but the private sector can, and should, finance most of the infrastructure projects, with the Government in the role of enabler. I am glad to say that, as we heard from the noble Lord, Lord Newby, the Treasury is looking at £257 billion worth of projects to come forward over the next five years. I gather that 180 projects are now earmarked for development. These include the new, and crucial, nuclear power stations. Negotiations with the suppliers have now reached a very critical stage, when they have to be persuaded that there will be some guarantee of long-term price stability. I do not know how that can be done, but it is clearly extremely important that we should have nuclear power. The question is: how are these to be funded? The Government are now striving to find some innovative ways of securing that funding, because banks will not provide long-term funding. Five years is the longest that many of them will now contemplate.
We are due to hear more about these funding plans in the Chancellor’s Autumn Statement. It is interesting that, thanks to the Indian summer we have just had, autumn now comes in December. Apparently, the Statement will include details of the new-look PFI. I do not want another PFI. They are profligate, foolish, and inept, and we will be paying through the nose for many years to come for too many of those schemes that came forward through the old-style PFI.
The public were duped into believing that we could have new schools, hospitals and bridges without paying a penny. If it looks too good to be true then it is; and it was. Too many of the investors, many of them offshore, have made fortunes out of PFI, while the public have been saddled with long-term future commitments. These were heads-I-win, tails-you-lose commitments. We do not want PFI again, or anything like it. We need something new and innovative, and I hope that the Government will come forward with some means of providing funding that will not leave the public sector on the hook, as it has been. For example, as regards roads, the need for improvement is clear; there are potholes everywhere. However, if we are to have new roads, someone has to pay, and the Government simply cannot afford to. Surely it is right that those who use the roads pay; whether through tolls or through other electronic means of road pricing. That is surely the way forward. We have to avoid things such as the M6 toll road, where Macquarie, in its various guises, is now said to be making a return of about 150% a year.
There are sources of long-term financing that we need to tap into for such projects. The insurance and pension funds have long-term liabilities which could fit neatly with these schemes. The noble Lord, Lord Giddens, made mention of the pension funds. Clearly, they are right to have some qualms, but the Government are working with various trade bodies, including the Association of British Insurers, to try to devise ways in which the funds with long-term liabilities might come together to provide funding for major infrastructure projects. I hope that we will be able to hear more about that in the Autumn Statement. The talking has gone on for a while; it would be good if we were soon to see some action.
Finally, I am grateful to the noble Lord, Lord Skidelsky, for reminding us that this country can do infrastructure rather well. We should not lose sight of the fact that the Olympics were a great success, and the gold medal tally was pretty good too. However, we can do infrastructure and we need to get moving on it.
Lord Berkeley
My Lords, I thank Ministers for briefing some of us about the Bill last night. It was a very interesting introduction to it.
First, I should like to spend a few minutes examining the wider problems, beyond the financing, associated with getting projects off the ground, such as the approval process, planning and, of course, the appraisal criteria. I think it was two years ago that Infrastructure UK published a report comparing the civil engineering costs of big projects in the UK and Germany. The costs of construction were remarkably similar, but what was different was the enormously greater cost of getting projects off the ground in this country. It was very interesting that in his introduction the Minister said that one of the criteria for financing was that you had to get the project off the ground within 12 months of obtaining the finance. That is quite a challenge. First, presumably one has to get through compliance with the Treasury Green Book, which is an incredibly complicated document. You need lots of consultants’ reports to support your case, which costs time and money, and sometimes the results are such that you wonder whether the exercise is worth while. A similar document is required for transport projects and, again, it is incredibly complex. It goes down to fractions of a second, timing millions of cars, and that decides whether you build a motorway, a road or something else. Again, that costs an enormous amount of money. What will the criteria be for allowing these projects to be financed in this way? At the same time, does the Minister agree that it is about time that the Green Book and the equivalent transport document were reviewed to make them cheaper and simpler?
The next issue is planning, alluded to by my noble friend Lord Adonis. Planning delays are getting longer and longer. I declare an interest as chairman of the Rail Freight Group. Some rail freight terminals in the south-east have gone through two planning inquiries. The Minister lost the last judicial review on one of them, so he is now thinking of a reason for having another planning inquiry. One might suggest that, in considering these things, Ministers should obey the law and look at these things objectively, as I am sure their legal advisers will have asked them to do. However, it all adds up to an enormous cost for developers and enormous time delays. Getting planning permission for some of these projects can cost £10 million or even £20 million because of all the consultants involved. Therefore, while I welcome the finance in the Bill, I am not sure how much it is going to help things to go ahead.
Secondly, I want to cover briefly what the Minister said about this Bill having minimum impact on the public sector finances. I would say that I have not been speaking for 10 minutes yet; that may be wishful thinking on someone’s part. There are so many here who are experts on finance that I deign to tread there, but if we have a £50 billion fund for investments or guarantees, does that not affect the PSBR somehow, if it still exists? A couple of years ago I asked the Secretary of State for Transport—it was Philip Hammond, who was two Secretaries of State ago—whether he had any views on whether Network Rail’s debts should be on the government books. He said that he was agnostic about it; I do not know whether that still applies. There is also said to be a debt liability of £1 billion on the Channel Tunnel going back 25 years, so I do not know how all this works. However, I cannot believe that a £50 billion fund or guarantee from the Government has no effect on government finances. I am sure that the Minister will be able to put me right on that.
While everyone is encouraging projects to go ahead with a kick-start, I find one in particular a bit odd. This is the second Bill this year that would authorise government funding for the Thames tunnel. The previous one was the Water Industry (Financial Assistance) Act 2012. Why is there this enthusiasm for pouring public money into a Chinese-owned so-called public-private sector utility? Are the Government not aware that on 18 October the European Court of Justice, in its judgment C-301/10, found that the UK had not complied with directive 91/271 in respect of the Thames and another river somewhere up north, but that in seeking to comply the Government should look at the best known technology that does not impose excessive costs? I think that £4.2 billion—the equivalent of £80 every year for 30 years on every water payer within the Thames Water catchment area, which goes as far as Oxford and beyond—is probably excessive if there is an alternative. Paragraph 64 of the relevant judgment says:
“The concept of BTKNEEC”—
that is what it is called—
“thus enables compliance with the obligations of Directive 91/271 to be secured without imposing upon the Member States unachievable obligations which they might not be able to fulfil, or only at disproportionate cost”.
Even without this government money, then, the Thames tunnel will put all that money on. It may or may not comply but the judgment requires the Government to look at this again and at alternatives, which I believe exist. The noble Baroness, Lady Gardner, said that money should be put to good use and spent wisely. This is an example where, if it goes ahead, it certainly will not be. I hope that the Minister will impress upon his colleagues in Defra the need now for an independent review of the different options for complying with the ECJ ruling and for mitigating the fine which, at its worst, I am told could reach £1.5 billion. There is big money at stake here and a lot of it could be saved by looking at different options a little creatively. I will be meeting the Minister in a couple of weeks’ time to discuss this, when I shall expand on it further.
Lord Newby
My Lords, as predicted this has been an extremely interesting debate. I think I have been grilled by three LSE professors, which is probably par for the course in your Lordships’ House. I will do my best to respond to many of the questions raised. As an introduction, I have two points for the noble Lord, Lord Adonis. First, as far as I am aware, under the previous Labour Government’s plans there was an intention to have significant reductions to the deficit, about which not one word escaped the noble Lord’s lips. Presumably, had he had some ongoing responsibility he would have been trying to make sure that all that reduction had no impact on infrastructure spending. But that was wishful thinking. There would have been significant changes in infrastructure spending, even if the noble Lord was still in his former position.
Another point was made earlier by my noble friend Lady Maddock. Labour's record on housing and other areas of infrastructure expenditure, particularly social housing, hardly stands forensic scrutiny. It has certainly left us with a legacy on housing which we are struggling to put right.
The noble Lord asked a plethora of questions and I can respond to only some of them. His concern for the A14 is touching. I can confirm that it is a priority project. The Government announced in July that there will be support for an upgrade of the A14. As he surmised, the proposed scheme involves tolling. We are continuing to work on the funding package and are focusing on finding ways to bring forward construction earlier than 2018 by, among other things, streamlining the planning and procurement processes and identifying local contributions to the costs of the scheme. As my noble friend Lady Gardner of Parkes said, although circumstances are different in Australia, if other countries can do tolling it should not be beyond our ability.
The noble Lord asked about airport capacity and was scathing about the fact that we have now embarked on a review. Sadly, he did not tell us what Labour’s policy was in terms of hub airport capacity. The fact that I do not know what it is is no doubt a failure on my part. He also asked about HS2 and I can assure him that we are expecting a Bill on HS2 in the next Session. The Government are pressing ahead with the scheme.
The noble Lord referred to the fact that some 63 of the projects in the national infrastructure plan had vanished. That is true. It is the nature of large projects: some are brought forward and disappear and others come forward that were not there then. He will be relieved to know that next month there will be an update on the national infrastructure plan and he will be able to see not just which projects have dropped out but which new ones have dropped in.
The noble Lord asked why a second Bill concerning infrastructure was coming forward with infrastructure in the title—the Growth and Infrastructure Bill. That Bill has a completely different purpose from this one, although they have a single objective, which is to bring forward economic activity. That Bill deals with the planning and other non-financial constraints around getting housing in particular going. This Bill is purely a financial Bill.
My noble friend Lady Gardner of Parkes raised the desirability of getting more small builders operating. We agree. There has been a big reduction in the small building sector. We intend to support the establishment of a debt aggregator, which is an inelegant phrase. Such a body will be able to raise relatively large volumes of finance to lend to organisations such as builders needing smaller amounts of funding than a typical bond. It acts as a collective that will allow the money to filter down.
My noble friend also asked about the green belt and infilling. We are committed to safeguarding the green belt, but we recognise that there is some previous developed or brownfield land in many green belt areas that could be put to more productive use. We are encouraging councils to make best use of this land while protecting the openness of the green belt in line with the requirements of the National Planning Policy Framework.
The noble Lord, Lord Desai, accused us of doing a U-turn, or perhaps he congratulated us—I am not absolutely sure. He said that one of the problems is that the system is flush with money and he asked what the market failure is. There are two components, possibly. First, many companies are short of confidence to invest, largely because of the international economic situation. And secondly, the banking sector has not fully recovered from the great heart attack of 2008 and long-term lending in particular has not returned to the conditions that we saw before the crash. This is trying to help make it easier for banks which are very unwilling at the moment to lend in the long term, even for projects which in normal times they would lend on. As I mentioned in my opening speech, the volume of interest we have had suggests to us that this will be effective. The noble Lord said that many people are stuck because they cannot get a bank loan, which is undoubtedly the case. That is because of the problem that I referred to that the financial markets are not in a normal mode for long-term lending.
My noble friend Lady Maddock helpfully referred to the fact that the Government are committed to building 170,000 new social homes during the course of this Parliament. But she made the point that there are 390,000 new households being formed every year. We have a big problem and it is partly a cultural problem across the political parties. In the 1950s parties had in their manifestos figures indicating the number of houses that they were going to build. This was one of the key things that made Macmillan’s career. Housing has slipped down the political agenda and different sectors—health and education, for example—are vying for funds. We are all having to reassess the urgency of the need to get more funding into housing. It is a long-term issue and it is becoming more and more clear that it is a difficult issue; all parties, if you look at their performance in recent years, have tended to give it a broadly equal degree of priority, but it has probably not been a high enough degree of priority.
The noble Lord, Lord Giddens, asked me four exam questions and I will do my best to answer at least some of them. He asked about priorities and how Infrastructure UK decides between all the proposals coming forward. We have set out a menu of things, all of which are important, but there is not any artificial predetermination of priorities before we see what the applications say. Every application will be looked at on its merits.
Lord Newby
That is a philosophical question, almost. When is a menu a plan and when is it not a plan? If I am making a dish, it very often lists a number of things that are absolutely required to make a successful dish but it does not necessarily say in what order I need to chop them up. The menu taken together would undoubtedly represent the implementation of a very significant plan.
Lord Adonis
Is the Minister not confusing a menu with a recipe? A recipe is the plan; a menu is options which then lead to recipes thereafter, if I can be philosophical.
Lord Newby
I am always in awe of the culinary skills of the noble Lord, Lord Adonis, and am extremely grateful for that way of looking at it. However, whether it is a plan, recipe, menu, or none of the above, the key thing is that, as far as risk is concerned, which was the second question that I wanted to address, the Treasury will be responsible for managing the risk and assumes the contingent liabilities. Value for money, as I said earlier, is key.
The noble Lord, Lord Giddens, asked about the pension infrastructure platform, about which I should perhaps have said more. As he may know, last week, seven pension funds announced that they would be initial subscribers to the platform. They will each invest at least £100 million. We hope that the system will be up and running early next year and that it will be the first element of a much larger fund. As to why we think that pension funds might now get involved in this kind of investment whereas they have not in the past, the answer is that, in the past, they have been able to get better returns through conventional means of investing the money. At the moment, with interest rates so low, they are getting very low returns. The other problem that they have had is that, where they have gone via private equity houses which have managed infrastructure programmes, they have often found that the programmes have not worked very well and that they have been charged an arm and a leg for it. So this is a way for the funds, with support from the Treasury, to get into what could be very important new form of investment without what they have seen as being the unreasonable cost of going down a purely private sector route.
The noble Lord also asked about the relationship between this Bill and the energy Bill. The purpose of the energy Bill is to set a framework for investment in the energy sector over the medium term. Once the energy Bill, which will come forward relatively soon, is enacted, and against the framework that that Bill sets out, people looking to invest in the energy sector can form a view about what they want to do and individual projects will be eligible for support under the Bill.
The noble Lord, Lord Skidelsky, started with three nonsenses and will not be surprised that the Government do not agree absolutely with everything that he said. I find it almost incredible to think that if the Government had not been seen to get the fiscal position under control, interest rates would not have gone up. Even if they had not gone up to the levels that they are at in Greece or Spain, a single percentage point increase in interest rates, among other things, costs mortgage holders in the UK an extra £12 billion a year and would over the course of a Parliament, with all other things being equal, cost the Government about £25 billion. These are very important considerations. Interest rates would almost certainly have been higher if we had turned on the tap.
On his proposal for a British investment bank which would raise money in the private market, the noble Lord will not be surprised to know that the Treasury view is that, if that bit of the state is raising money in the private market and conventional government borrowing is happening in the same private market at the same time, the markets will judge the pair of them together as a common pool of demand from the UK Government. Therefore, we could not segregate borrowing for a British investment bank without it having consequences for the way in which all government borrowing was viewed.
The noble Lord asked how many of the net gains in employment were self-employed or part time. There is a false assumption that working for oneself or working part time are somehow second-class things to do or things that people do not necessarily choose to do. Some people are forced to do one or the other. However, when I was made redundant in the last property crash in 1992, I in effect became self-employed by setting up my own company and it was one of the better things that I have ever done. It did not mean that I was economically out of the market or that I was not able to grow anything. Many people who become self-employed find that they are successfully self-employed. Equally, many people who work part time—and even the Guardian accepts that the figure is at least 80%—do so through choice rather than because they are forced to.
Lord Skidelsky
Would the Minister be kind enough to answer my question? What proportion of the Prime Minister’s 900,000 new jobs are part time and what proportion are full time? Further, are those employed under government work schemes included in the figure of 900,000?
Lord Newby
I am afraid that I do not have those figures to hand but I will write to the noble Lord.
The noble Baroness, Lady Wheatcroft, raised concerns about continuing the old system of PFI. Many people share her concerns about the way that PFI has worked, and in any future schemes I know that the Government will seek to avoid the problems of the past in that respect.
The noble Lord, Lord Berkeley, asked several questions, one of which concerned the criteria were for which projects come forward. As I said in my opening remarks, the five principle criteria are that the schemes be nationally or economically significant, financially credible, good value for money for the taxpayer, not solely dependent on a guarantee to proceed, and ready to start construction in 12 months. He asked whether the £50 billion affects the PSBR. The answer is that it affects the PSBR only if guarantees are called upon. My understanding is that if it is a contingent liability, this does not affect what I still think of as the PSBR.
The noble Lord, Lord Berkeley, also asked about the Thames tunnel and whether we might have an independent review. Living as I do on the Thames and being subject to many public meetings about the Thames tunnel, it seems to me that the current programme of proposals on the tunnel involves a huge amount of consultation and much discussion of alternatives. Having got this far on what seems to be an unavoidable necessity, I certainly would be extremely loath to think that we had to go back to the drawing board and start again with an independent inquiry.
Lord Berkeley
Could the Minister answer my question about whether there will be a review or abolition of the Green Book?
Lord Newby
It will not be abolished. I will pass on the noble Lord’s concerns to my colleagues in the Treasury, who I am sure are already aware of them.
This is an important and much needed Bill. It will allow critical infrastructure projects that are being held back by adverse credit conditions to proceed and will support much needed investment in the rented housing sector. It contains measures that will support growth, jobs and families, all at minimal cost to the taxpayer. It will help to unlock the investment that the UK urgently requires to make it one of the predominant places in the world to do business, and to support sustainable growth that is balanced across sectors and regions. I request that the Bill be given a Second Reading.
Bill read a second time. Committee negatived. Standing Order 46 having been dispensed with, the Bill was read a third time and passed.
Statement of Changes in Immigration Rules
(12 years, 1 month ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Baroness Smith of Basildon
That this House regrets that notwithstanding welcome but limited measures to ensure the deportation of foreign criminals and tackle sham marriages, and notwithstanding the importance of greater protection for the taxpayer, the Government have not demonstrated that the specific minimum annual income requirement which has been introduced through the Statement of Changes in Immigration Rules (HC 194) is the most effective way to protect taxpayers and deliver fairness for UK citizens who wish their spouse or partner to settle in the United Kingdom.
Relevant document: 6th Report from the Secondary Legislation Scrutiny Committee
Baroness Smith of Basildon
My Lords, I should say at the outset of this debate that we support the Government in their efforts to address and manage levels of immigration to this country and to make it easier to deport foreign criminals, but my Motion of Regret is on the specific aspect of HC 194, that part of it which sets an income threshold of £18,600 for British citizens and people settled here who wish to sponsor their spouse or partner to come to live with them in this country and of £22,400 for couples with children. I would also like, during the course of the debate, to raise with the Government the issue of Article 8 of the European Convention on Human Rights—that is, the right to respect for private and family life—and the Government’s proposal to find greater legal clarity by balancing Article 8 with public interest considerations.
On income threshold, of course it is right that if an individual wishes to bring their family to settle here in the UK, they should not assume that the state will support them. That is why it is already a requirement for an individual to demonstrate that they have access to sufficient funds at a level that will put them in a similar position to someone on income support here in the UK, so that they will not seek recourse to benefits. Unlike a blanket income threshold, the current position allows authorities to take into account the different ways in which a couple may be able to demonstrate that they can meet that requirement. For example, currently, the joint income of a couple can be taken into consideration when assessing whether their funds are adequate, as well as the likely employment prospects of one or both of the parties. Couples are also able to use an undertaking by members of their family in the UK to provide them with adequate funds for maintenance as evidence that they will be able to support themselves without recourse to the state.
I understand that that leaves a level of discretion in decision-making, and we support efforts to provide greater clarity in the rules, to eliminate opportunities for abuse, but we must also recognise that, nowadays, we live in a world where it is commonplace to travel, to study, to do business and to work abroad, so it is only natural that people from here in the UK will travel, fall in love and form long-term and permanent relations across borders. Family circumstances are not always as straightforward as government policy assumes. Many in your Lordships’ House will know of couples of different nationalities, friends and family members, who have established long-lasting relationships through living and working abroad.
When my Motion of Regret was published, I received several letters by e-mail and fax from those who have been affected by government policy. I do not know the circumstances of all those who have contacted me, but as a generalisation, I would class those who have contacted me directly as strivers—a term that the Prime Minister has used. They are people who work hard to provide for themselves and their families, not rich or wealthy people, but often people who work hard in useful jobs on wages lower than most of us in your Lordships’ House have come to expect in our working lives.
I want to refer to a couple of examples that I think may help your Lordships’ House in considering the issue. I shall call one family Mr and Mrs M. They are a married couple. She is from a Commonwealth country; she is Canadian. Both of them have children from previous marriages. They married in 2005 in the UK and lived in the UK for a year, when she went back to Canada to go to university to complete her education, which would no doubt lead to a better job. As she puts it to me in her correspondence, it was,
“short term suffering for the long term benefits”.
Her husband visited Canada a couple of times and they then decided that they would settle in Canada. For a number of reasons, not least being his responsibilities to his family here in the UK, including his parents, who were getting old, he moved back home in 2010 and they agreed that she would follow him once he found work. In the mean time, his wife sent him money from her earnings in Canada to buy household items for the new home that they were going to set up here in the UK. Again, these are people trying to do the right thing in seeking to support themselves. Alfred got a job; he was doing well and she started to complete the visa application form. However, in July 2012, their world just fell apart because he did not earn the £24,800 that the Government said he had to before his wife and two children could join him. His father was a miner in Wales; he had a low income—both were proud men and proud of their work. They estimated that his wife—when they thought she was going to join them—would get a job in the region of £18,000 to £24,000. Yet despite all their planning, and all their efforts to provide for themselves, they have fallen foul of this rule and are now living on different sides of the world.
There is another lady who contacted me, Miss BF. She and her non-EU partner plan to marry in December 2012. She wrote:
“I do not earn £18600. I work part time as a healthcare assistant for the NHS. I am unable to work full time as I have a 14 year old son … If I worked in London I could earn the £18600 however the cost to rent in London would probably be triple the cost of my current mortgage. The income threshold does not allow for variations in circumstances. It does not allow for the earning potential of single parents, or for women in general. Our wedding plans are now on hold”.
So no regional variation—or, again, partner’s income—is taken into account.
Mr S—a highly qualified man who has worked in government in the past—also outlines in his letter to me the perverse incentive of an absolute threshold. He lives some distance from London. He says:
“I’m desperately trying to find a job that would make the required £18,600 a year. In this area, that scenario is a difficult one, so I’m looking for work in London. If I secure such a job, earning the required salary, it’s likely that most of this would be spent on the high costs associated with living in London. Yet the government deem this ok. However, I could probably find a job in this area earning around £14-15,000 and would have more disposable income to support my family whilst having the assurity of living with my parents in the short term.”.
All these are people trying to do the right thing—trying to support themselves. As there is now no flexibility in the system, but a very blunt policy of a blanket income threshold, the rules can unfairly penalise couples like Mr and Mrs M, and people like Mr S and Miss BF. Can the Minister confirm that we have members of the Armed Forces serving overseas who, if they were to marry somebody they met on duty overseas, would have an income that would fall below the level expected by the Government and who therefore would not be allowed to bring their new wife or husband back to the UK with them?
People who are trying to do the right thing and who are strivers—and the Prime Minister has used both those terms—and who would so easily be capable of supporting themselves and are determined to support themselves without relying on the state, are being turned away. We need a system that delivers protection and fairness for existing tax payers, but also fairness to families like this who will ultimately be net contributors to the system.
This is about the right to family life for British citizens and those permanently settled in this country. That is not an absolute right but one that is rightly qualified by the public interest test. None the less, it is of the utmost significance to the lives of many British citizens who wish to settle their families in the UK. Did the Government properly and adequately examine all the options for the most effective method of delivering fairness to both families and taxpayers? We contend that the Government have failed to do so. The Government have relied on the response of the Migration Advisory Committee for justification of the policy and the level at which the income threshold has been set.
So, what was the question that the Government asked the Migration Advisory Committee, which provided the evidence that this was the correct policy? Did the Government ask: “Is an income threshold the most effective way of delivering fairness for the taxpayer and families and preventing abuse of the system?”. Perhaps the Government asked the Migration Advisory Committee: “What would be the best way of ensuring that those bringing a spouse or dependent children into this country would not have recourse to public funds?”. It was neither of those questions. Instead, the initial question that the Government asked the Migration Advisory Committee was framed in a way that made it clear that they had decided the policy before asking the question. It was,
“what should the minimum income threshold be for sponsoring spouses/partners”.
The policy of a single income threshold had been decided, and the question was asked in such a way that it could only be answered with an assessment of the amount. The Government pre-empted any independent advice from the Migration Advisory Committee on what would be the most effective and fair process for determining adequate means of support without reliance on the state because they had already unilaterally decided on an income threshold policy.
Baroness Browning
My Lords, I join this debate briefly because I was intrigued by the noble Baroness’s Motion. I have discussed it informally with the noble Baroness. Having looked at this and made a study of average wages, I think it would be helpful if my noble friend in replying could confirm what is in the instrument, as was drawn to the attention of the House by the Secondary Legislation Scrutiny Committee in its report back in July. The committee said:
“The changes to immigration rules contained in HC 194 are extensive although mainly intended to strengthen or clarify the current position and reduce overall numbers claiming a right to settlement on the basis of family life”.
I welcome the fact that we are having a much more open and honest debate about immigration than perhaps we would have had three or four years ago. I read the memoir, Back from the Brink, by the right honourable Member for Edinburgh South West, Mr Alistair Darling, the former Chancellor of the Exchequer, where he confirms that perhaps things were not spoken about in the past. Immigration is an issue, and it is something about which we should be a lot clearer and have a discussion.
If it is the intention of this rule that we are to reduce overall numbers, which is how I have interpreted it, equally the rule changes before the House in this instrument seem to make it absolutely clear that financially, among other things—and it is among other things, because the financial aspect of this minimum threshold of income is part of a package of rules—people who live in this country and have dependants can afford to maintain them as well as live an average life. I always think that it is difficult when we talk about averages. Therefore, the bar has been set at £18,600, although the appendix to the instrument refers to a,
“minimum income threshold of £18,600 for those who wish to sponsor the settlement in the UK of a partner of non-European Economic Area nationality”,
and says that a,
“higher threshold will be required for sponsoring any dependent child under the age of 18 in addition to the partner: £22,400 for one child and an additional £2,400 for each further child sponsored before the migrant parent qualifies for settlement”.
It would be helpful to the House if my noble friend could clarify how that threshold was set. If I have understood it correctly, it is the sort of policy that one sees elsewhere. It is a level set to ensure that people are not dependent on the state. But, equally, there is another dimension to people’s wealth within the family. I wonder whether my noble friend could touch on something that was debated in some fullness, along with the economic impact of immigration, by the Economic Affairs Committee of this House. I have a copy of the committee’s report from the Printed Paper Office. In 2007-08, noble Lords discussed the question of capital. Apart from the threshold of income, how is capital considered? I realise that the noble Baroness, in tabling this Motion, looked at those on low incomes and the impact that this measure might have on them, equally there are families for whom capital can be a substantial part of their income. Will my noble friend say a few words about those who sometimes would be regarded as capital rich but income poor? Capital does not seem to be mentioned here at all, so, going back to that very good report that came out of the Economic Affairs Committee of your Lordships’ House in 2007-08, will my noble friend touch on that issue?
In adverts that encourage people to migrate to other countries, one often finds a focus on certain occupations. In English-speaking Commonwealth countries, they are particularly focused on people with certain skills, who are able to carry out certain occupations. Presumably, apart from the need to recruit those skills into those countries, there is also a focus on the ability to be financially independent. I thought that I would contribute to today’s debate as earlier in the week I went through some research that looked at levels of pay. I realise again that we are dealing with these dreadful averages, which are never quite what our personal experience is of individual cases. For example, if we look at teachers’ pay, the scale point for people newly qualified starts at £21,588. Looking at the salary bands that might apply here, we are looking at professionals and we are probably looking at people who have gained qualifications in a trade or a profession that would make them employable on coming to this country.
I also took a quick look at regional variations, particularly the average salaries in cities and the different categories there. In London, the average salary is £33,000 a year, which is not typical perhaps because of the nature of London. I went up to Aberdeen and found it was £33,000—no different from London. In Bristol, in the south-west, the average was £27,900. I will not read them all out to the House but I did not find any figures in the average city salaries below the £18,600, or anywhere near it, that would sustain a family with two children.
I want to ask my noble friend this question and I ask for a frank reply to it. If we are reducing the number of people allowed to come to live and work in this country—which is what the instrument is about and this is an open policy as we realise these matters need to be brought under control—are we gauging it at £18,600 plus the additional amounts for dependent children on the assumption that people will have qualifications or professions in which they can work which would add to the British economy? Is that what is steering it? Can my noble friend give some indication as to whether that figure is to recruit people where we have skills shortages or just a bar that has been set to make sure that in opening our shores to people from abroad we are not encouraging dependency on the state?
Baroness Lister of Burtersett
My Lords, it is always a pleasure to follow the noble Baroness, Lady Browning. She has raised some very pertinent questions. While I want to focus on the income thresholds, I want also to draw attention to the concerns raised by BID, Bail for Immigration Detainees, about the implications for children of measures to ensure the deportation of foreign criminals.
BID’s experience is that wide powers already exist to deport foreign national ex-offenders, and in the very few appeals against this which are successful it is often because the courts have found that grave harm would be caused to a child by deporting the parents. It says that the Government are now seeking to prevent the courts from upholding the law to protect these families. In the view of BID, the measures do not allow for adequate consideration of the child’s best interests. For example, it does not follow that it is in a child’s best interests, if there is another relative that they can live with in the country, to live with that relative and to be permanently parted from their parents; or, say, if the parents have been in prison and the child has been living in foster care, for them to be deported with their parent to a country that they have never visited before.
Liberty, too, raises concerns about the implications of the changes for children and concludes:
“It is clear from the Government’s proposals that it is paying little more than lip service to the importance of UK children’s interests in immigration decisions … Far from placing children at the heart of immigration decisions, the proposed changes seek to relieve officials of the responsibility for weighing up the interests of a child in any but the most clear cut cases”.
I would welcome the Minister’s response to that and his explanation of how children’s interests will be safeguarded.
As we have heard, the Home Office’s human rights statement and the Home Secretary have emphasised that Article 8 of the European Convention on Human Rights, on the right to respect for privacy and family life, is a qualified right. As my noble friend Lady Smith has already said, we accept that. However, as Liberty argues, there is,
“a delicate balancing exercise to be struck between the rights of the individual and wider social interests in, for example, the reduction of crime and disorder and the protection of the economic interests of the UK”.
Liberty and I do not accept that the proposed changes,
“properly accommodate the fact-sensitive balancing exercise that the right demands”.
Liberty argues that instead they,
“represent a one-size-fits-all approach to complex immigration decisions. … Far from better reflecting the proportionality required under Article 8, the proposed changes seek to circumvent the crucial fact sensitive consideration of decisions involving fundamental rights”.
The Government argue that the income threshold is proportionate in meeting their legitimate aims of safeguarding the economic well-being of the UK. It is a sad day when the economic well-being of the UK depends on keeping apart a few thousand poor families each year without adequate attention being given to safeguarding the well-being of children and their families.
The Migrant Rights Network points out that, because of differences in earnings across different social groups, the new income requirement will disadvantage women, who we know are still on average paid less than men, some minority ethnic groups and people living outside the south-east. My noble friend gave an example that illustrated the unfairness of that fairly arbitrary or one-size-fits-all limit.
The Home Office human rights statement acknowledges that the income threshold may be challenged under Article 14 of the European Convention of Human Rights in terms of its equalities impact, particularly with regard to whether this constitutes unjustified indirect discrimination against these groups—for example, women and those nationalities who the evidence shows are likely to have lower earnings. Having raised this possibility, the Home Office’s only answer was that this will be mitigated in some cases by the exemption from the income threshold of those in receipt of carer’s allowance, and that certain contributory benefits such as maternity allowance will be allowed to count towards the income threshold. That is welcome as far as it goes, but it does not go very far. Otherwise, the Home Office considers that any indirect discrimination is proportionate to public policy objectives. We will see, but I imagine that this will be tested in the courts.
I find it repugnant that we are going to means test family life. Means-testing generally purports to target help on the needy and exclude the better off. This is a reverse means test that excludes the needy, as if people on low incomes have nothing to contribute to this country. The existing “recourse to public funds” rule is already designed to prevent the supposed burden on the taxpayer that we hear so much about. According to Liberty, and as my noble friend has already said, it is being replaced by a far blunter instrument.
The impact statement makes a virtue of the shift from a more discretionary approach, which it says is complicated for caseworkers to operate, yet in other areas of policy the Government favour more discretionary approaches and say that we have to get away from a one-size-fits-all approach. Indeed, as Liberty argues, the proposed changes as a whole contain an armoury of blunt instruments which, far from better reflecting Article 8 and the Immigration Rules, may well leave the rules in breach of it.
The changes reflect badly on a Government who claim to be the most family-friendly Government ever and who are supposed to be applying a family test to all their domestic policy decisions, as they suggest that some families are considered not to matter because of their immigration status and their poverty.
Lord Avebury
My Lords, this is a very important debate, focusing as it does on family and children’s rights. We have all heard from organisations such as the ones that have been mentioned, including by the noble Baroness, Lady Lister—Liberty, Bail for Immigration Detainees, and so on—and I shall rely on the evidence that has been given to them in my later remarks.
Since these changes were published, a further three sets of changes have appeared: HC 514 of eight pages, HC 565 comprising 56 pages and Cm 8423 with 276 pages. These latter two statements spell out in detail how decisions on leave to enter or remain are to be made, following the rulings of the Supreme Court in Alvi. To summarise, at the risk of oversimplification, Alvi said that statements in guidance and elsewhere that were not in the Immigration Rules, such as particular types of evidence that have to be submitted with an application, were unlawful because they had not been laid before Parliament as required by the parent Act. I realise that we are not talking about these subsequent statements of changes this evening, but obviously the legal advisers and their clients who are considering the effects of HC 194 will have to look at these other instruments as well. It would be astonishing if, given the length and complexity of all the changes taken together, there were not a steep rise in the number of applications rejected because of some minor omission or mistake.
My first example is from the organisation BritCits, which defends the interests of families who are affected by this set of changes. Rob is a British professional musician with a first-class degree in music. He has taught music and performed at concerts, has an eight year-old son and lives in a detached house in Huddersfield. He fell in love with and married an Indonesian woman and his wife applied for a spouse visa on 26 June. As a self-employed worker, he submitted three years of bank statements—originals and copies—and everything as requested, leaving no stone unturned. For over two months the message was that the application was under process at the British embassy, until early September when an e-mail arrived asking for the spouse to take an SELT English test. The e-mail indicated that if she did not submit this within seven days, the application would be rejected. Despite the short notice, the wife took the test and submitted it on time. A month later, they received a message saying that the application was refused because of the English test. Rob was amazed because his wife’s English was extremely good. On inquiry, they found that she had passed the reading, writing and listening requirements but had inadvertently omitted the speaking part. A lawyer advised them that the only remedy was to lodge a fresh application, at a cost of £900. The same thing happened to a friend of mine. It is not an uncommon experience for people to make a minor error and find that the whole application has been rejected. The UKBA does not give applicants a chance of remedying minor omissions of this sort.
The Motion says that the Government have not demonstrated that the specific minimum financial requirement is the most effective way to deliver fairness. That stricture can also be extended to the provisions dealing with savings. This may answer part of the question put by the noble Baroness, Lady Browning: I quote the example of a woman with three children applying to join her husband who would have to show evidence of savings of £62,500, which is well beyond the resources of most young families.
A four-page guide produced by UKBA tells applicants that they need to read Appendix FM-SE, another 26 pages of dense prose, which was added to the rules on 20 July, specifying what supporting documents may or not be supplied as evidence of compliance with particular financial requirements. The sums involved are undoubtedly substantial and they mean that many spouses and children who would have been able to satisfy the previous requirement—that they could be supported and accommodated without reliance on public funds—will now be denied entry. That is, indeed, the letter of government policy. The Migration Advisory Committee estimates that if the financial requirement in this set of rules had been in force in 2011, it would have excluded 45% of successful applicants, even though all those spouses and children were assessed as not needing access to public funds.
The Lord Bishop of St Edmundsbury and Ipswich
My Lords, I do not mean to detain the House for long, but I would like to echo some of the concerns that have been mentioned today, particularly on the inflexibility of the income test. Looking at what is laid before us —a specified gross annual income of at least £18,600, an additional £3,800 for the first child and an additional £2,400 for each additional child—a clergy family with three children would not earn enough stipend to meet that test. The reason why they survive very well is because their housing costs are met, as are their council tax, and there are other means of keeping them housed in areas where the Church wants them to live and minister.
I can think of two examples of a UK passport holder, a member of the clergy, whose spouse holds a foreign passport outside the EU, one of whom has three children. Whatever you think of the mission of the Church, which is of course promoting the Christian religion of the Church of England, one of them also lives in an extremely deprived area, and the social capital that he has added to that area is considerable. This is not simply someone coming to take advantage of the state but someone who has given an awful lot, which has been recognised by local authorities.
Inflexible rules cannot deal with these sorts of difficult anomalies, and so discretion needs to come in. The overall thing that I would like to echo is: how is this now being monitored? How is it being applied, and is it applied fairly? When UK Border Agency hard cases come into the public domain, anxiety is always raised, and of course it is easy to do that. I appreciate the fact that these are hard-working officials, and indeed, when given an opportunity to meet some of them I appreciated their frankness and their willingness to look at how they might help. Nevertheless, there are too many stories of the difficulty that the noble Lord, Lord Avebury, described as happening in some of these applications. I can think of another member of the clergy, a UK passport holder, who was going through the whole process to help his spouse to get leave to remain. They were told that they could not apply before a certain time limit. They applied at the time limit and then, when they applied for a slot for her interview, they were told, “There are no slots left”. These are intelligent people who can cope with that sort of thing, but there are many people who cannot.
I do not think that anyone in this Chamber would want to deny the scale of the problem that we must face as a country, but against that background, having realised the problem, where are fairness and justice going to be helped to be seen to be done, and how is the UK Border Agency being monitored to see that it is applying standards of fairness to the best of its ability?
Lord Teverson
My Lords, I thank the noble Baroness, Lady Smith of Basildon, very much for bringing this regret Motion before the House. In fact, if anything, I regret that it is only a regret Motion. I would certainly have followed her through any Lobby if it were more of a fatal Motion because I feel that there are some fundamental issues here.
It is interesting that this regret Motion has been put forward this week. My weeks are often imaged by the cover of the Economist, which I read most weeks. This week it is inaccurate in one way, although accurate in another. It says:
“Immigration. The Tories’ barmiest policy”.
Of course, that is wrong. It is not a Tory policy; it is a coalition policy. It includes my party as well. Its argument is that the policy on immigration very much restricts the economic and financial potential of this country, but here we have pinpointed an area where we are restricting the moral, ethical and family aspects of our society within the UK.
I say to the noble Baroness that I was probably one of the few people in this country to be very disappointed that the leader of the Opposition apologised for Labour’s “migration mistakes” in 2004, which allowed the best talent from the new European member states—which in many ways we had treated treacherously in the settlement after the Second World War—to come to this country, because they were restricted in going to other EU states. They repopulated much of Scotland, and in the south-west, where I come from, they manned much of the tourist industry, which had found it difficult to find talented and energetic workers. Therefore, I regret that that happened.
I understand entirely that sham marriages exist. They are a cancer on the institution of marriage and they are probably growing in number. That has to be stopped by whatever means possible. I also agree that there cannot be limitless migration. However, our society is becoming more and more international. Taking my family as an example, some of my wife’s children live in Singapore and others live in Argentina. Her grandchildren have mixed religious affiliations and mixed nationalities. People meet other people more and more on an international basis, particularly when they are youngsters and in their first areas of work. Therefore, this problem is going to get worse.
I say to the Minister that I believe this matter comes down to two important issues. Those are fundamentally moral and ethical, with human rights perhaps coming third. First, it must be fundamentally in the DNA of the UK that its citizens can marry whomever they want. That has to be a basic right of our citizens, who have one of the greatest and deepest histories in terms of being able to exercise individual rights. I also say to my Conservative colleagues—perhaps not the ones who are here but some of the others—that it is absolutely wrong for the state to intervene so strongly in deciding whom you are able to marry and live with. It is wrong that the state should be able to intervene to that degree. If the marriage is a real one—and that is always the important question—then people should be able to marry exactly whom they like and to live exactly where they like.
Baroness Hamwee
My Lords, I confess to a number of areas of confusion, the first being what the rules actually say. Other noble Lords have referred to their complexity. For me, looking at any set of Immigration Rules is a quick route to a migraine. I have been used to reading rather more than glossy magazines in the course of my career, so if I find them difficult—without wanting to be too big-headed—then so will many, many others.
I was reassured, in a sense, by the briefing from the Immigration Law Practitioners’ Association but that reassurance is very limited. It tells us that it is running advanced courses for solicitors and barristers on the financial requirements that are a part of these rules and has sent noble Lords an extract from its training notes, just to give us a glimpse of the complexity. Our laws should be accessible. Immigration is so difficult that legal practitioners have to be specially licensed. I, for one, am very grateful to the organisations that have briefed us. They helped me to short-circuit the work for this debate quite a lot, but that is not good enough when you are actually advising individuals.
The Parliamentary Under-Secretary of State, Home Office (Lord Taylor of Holbeach)
My Lords, I welcome this debate. The Motion tabled by the noble Baroness, Lady Smith, has given us an opportunity to debate this matter in this House. It has been a good debate and a lot of very interesting aspects of these rules have been raised. I am sure that noble Lords will not expect me to comment on individual cases. My noble friend Lady Hamwee did me a good turn by referring to the complexity of the rules because they are indeed extremely complex. If I fail to cover particular aspects of the points made and questions asked, I hope that noble Lords will forgive me if I address them in correspondence after the debate.
These new rules are a major reform of the requirements for family migration by people of non-European Economic Area nationality. They form part, as noble Lords have said, of the Government’s overall programme of reform of all routes of entry into the UK. The new family rules have three aspects, and I thank my noble friend Lady Browning for her welcome of these three aims. My noble friend Lord Teverson pointed out that the coalition has taken a different view from his own. I accept that but I think he will agree that the coalition is being consistent in its approach of this vexed problem of immigration.
I would also like to thank the noble Baroness, Lady Smith, for her general support of elements of these rules. First, they tackle abuse; for example, by extending from two to five years the probationary period before partners can apply for settlement to test the genuineness of the relationship concerned. My noble friend Lady Hamwee questioned that, but I believe that it is a reasonable expectation which should help to deter applications based on sham marriages.
Lord Avebury
My Lords, if that is the case, why have the Government refused to take into account the income provided by the spouse? Surely, if the £18,600 figure is sufficient to ensure that recourse to public funds is not on the cards, then that £18,600 should apply to the joint incomes, not to the income of the sponsor.
Lord Taylor of Holbeach
That is the decision that was made. The Migration Advisory Committee was asked to look at the amount of money that a couple would require on the single income—the sponsor’s income. Indeed, it is the sponsor’s income that is vital to understanding this case.
My noble friend also asked how the capital should be dealt with. As pointed out by my noble friend Lady Hamwee, the multiplier is two and a half times the shortfall in income, and that, too, I believe, came from the same recommendation from the Migration Advisory Committee.
Baroness Hamwee
My Lords, while the Minister is on that point, it would be helpful to the House if after today we could have an explanation of what lies behind both that action, which is less of an issue because it is a judgment, and my noble friend’s question about why a spouse’s income is disregarded. Indeed, one could add to that the question of why support from a third party, such as a parent of one of the spouses who would be prepared to guarantee the income, which I am sure is not uncommon, should be disregarded. What lay behind those decisions? What was the rationale? I do not expect the Minister to answer that now.
Lord Taylor of Holbeach
It would be much easier for me if I could inform myself before I sought to inform the House on that issue. I have stated the position as I know it to be, without knowing fully the policy development that led to that conclusion.
There has been criticism of the fact that there is no regional variation but, once people are in this country, they are free to move wherever, and it was felt that there could be great difficulties if a regional variation were permitted for that very reason.
The noble Baroness, Lady Smith, expressed concern about what will happen to people who lose their jobs. We will expect a migrant to be able to meet the same financial threshold when they apply for further leave but, once the migrant is in the UK, we count any income that they earn, as well as money from their sponsor, towards the threshold. That is an important response to the question raised by my noble friend Lord Avebury. In some circumstances, we will allow the migrant to continue at a lower rate on a longer route to settlement to allow that transition to take place. Both the noble Baroness and my noble friend asked about prospective earnings and I will seek to answer that in correspondence, as I promised.
We have also built significant flexibility into the operation of the threshold—for example, by exempting sponsors in receipt of certain disability-related benefits or carers’ allowance. I was asked specifically by the noble Baroness, Lady Smith, about the Armed Forces. The Armed Forces are exempt from these rules.
The noble Baroness, Lady Lister of Burtersett, felt, as did several noble Lords, that the rules were not sufficiently focused on children. We understand the importance of the statutory duty, which goes back to the Borders, Citizenship and Immigration Act, to safeguard and promote the welfare of children in the UK. That is why we have reinforced our approach by bringing consideration of the welfare or best interests of children into the Immigration Rules. After all, the best interests of the child will normally be met by remaining with their parents and returning with them to their country of origin, subject to considerations such as long residence in the UK, their nationality and any exceptional factors. The new rules lay out a clear framework for weighing the best interests of the child against the wider public interest in removal cases.
The minimum income requirement that we have introduced is, I believe, the most effective way to protect taxpayers and deliver fairness in respect of family migration to the UK. I invite the noble Baroness, Lady Smith, to reflect on my response.
Baroness Smith of Basildon
My Lords, I will reflect on the Minister’s response and will read and consider his comments in Hansard. However, I have to say that at this stage I am disappointed by his response; I wonder if he took on board any of the comments around the House about the devastating impact that this threshold is having on so many families. All of us in your Lordships’ House understand the need to tackle abuses—this was said to the Minister—but this measure goes beyond that and I do not think, as other noble Lords have illustrated, that it actually achieves the Government’s policy objectives.
The Minister said that it more effectively reduced the burden on the taxpayer and was fair to families. Based on the examples he has heard this evening, however, it does not seem a very effective way to protect the taxpayer. The issue is not just the level of the threshold but the principle of the threshold. He claimed that one of the questions I asked was what happened if somebody lost their job. That was not the question I asked at all; the point that I was putting to the Minister was that a threshold is an inadequate way of making an assessment, as someone could be above that threshold and then lose their job but still have the right to remain, since a judgment was made at one point in time based on a person’s income, rather than on a package of measures that was available previously.
I appreciate that he cannot comment on individual cases, but Mr and Mrs M, the lady from Canada and her husband from Wales; the lady who was the NHS care worker; and the clergymen referred to by the right reverend Prelate the Bishop of St Edmundsbury and Ipswich who wanted to come or bring their spouses to this country will all listen to the Minister’s comments with some dismay.
I appreciate that he was not able to answer all the questions but I was disappointed that he answered so few. I mentioned one to him about the perverse incentive where an individual would have to go and live in a more expensive part of the country to see their income increase, even though their costs would increase, including their rent or mortgage, and their disposable income would fall. That would qualify them to be able to bring their spouse into the country because they had a higher income level. That is a perverse incentive, to have a lower disposable income. The Minister did not comment on that. Nor did he comment on any of the examples—I am sure that this was not intended—of Church of England clergy’s partners being excluded from the UK. He also said that the Migration Advisory Committee supported the level but my understanding is that the committee was asked what the level should be; it was not asked to comment on the proposals generally or on whether this was the most appropriate way to achieve the Government’s objective.
I was especially hoping that the Minister would respond on the following issue that I raised. The Migration Advisory Committee, in its response to the Government, said that, of those who satisfied the current criteria of being able to show they had access to sufficient funds to support themselves and their families, 45% would no longer be eligible under the new criteria to have their spouses come to this country. I asked him how many of those who were eligible under the current procedures would not be allowed under the new rules and have since claimed access to public funds. He has not answered that. The answer that he gave was that 267 individuals now claim some kind of public support or assistance, but he was unable to tell us how many of those had come to this country through the existing rules on family visas. If he does have that figure, it would be extremely helpful to have it. I suspect that it might not be available but it might have been provided to him. It would have been a more useful figure and the one that I asked for.
Obviously we understand the need to ensure that the system is not abused, but I fear that what is being done here today will not protect the taxpayer in the way that the Minister seeks, and it certainly does not protect the family. I beg to withdraw the motion.
Motion withdrawn.