House of Lords
Food Banks
(10 years, 9 months ago)
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Lord Beecham
To ask Her Majesty’s Government what assessment they have made of the number and role of food banks in the United Kingdom.
The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord De Mauley) (Con)
My Lords, there are no official figures for the number of charities providing food aid, including through food banks, in the United Kingdom. Food banks are a mostly community-led provision responding to local needs, and it is not government’s role to tell them how to run the services they provide.
Lord Beecham (Lab)
My Lords, Newcastle alone has eight food banks and seven low-cost food centres. Is it not time that the Government recognised that the growth in the number of food banks and in the number of people using them does not reflect a lifestyle choice but is caused by hardship and hunger? Will the Minister urge the Secretary of State for Work and Pensions to resile from his petulant refusal to meet the Trussell Trust, one of the major providers of food banks, and instead discuss with it how best to meet the need that is now palpable in communities up and down the country?
Lord De Mauley
My Lords, we do, of course, appreciate that some of the poorest people are struggling. The Government’s view is that the best way to help people out of poverty is to help them into work. The latest labour market statistics show employment up, unemployment down and workless households down. We operate a number of government initiatives aimed at helping families with food—Healthy Start, Change4Life, and the School Fruit and Vegetable Scheme—and we are extending free school meals. There are a number of other measures designed to help households in the wider context. These are the ways in which we are tackling poverty.
Baroness Jenkin of Kennington (Con)
My Lords, my noble friend may not be aware that the APPG on Food Poverty and Hunger is shortly to start an inquiry into the reasons behind food poverty, which will be chaired by the right reverend Prelate the Bishop of Truro and Frank Field. I am sure we all look forward to its findings. Does my noble friend agree that the flip side of this coin is the shocking amount of food waste in this country, estimated at £60 a month for each household—the equivalent of six meals a week?
Lord De Mauley
My Lords, I am aware of the APPG inquiry of which my noble friend speaks, and I am looking forward with great interest to what it comes up with. As my noble friend also knows, we have a number of initiatives dealing with food waste. As an example, WRAP’s Love Food, Hate Waste campaign aims to raise awareness of the need to reduce food waste and help people take action.
Baroness Whitaker (Lab)
Is the Minister aware that since food banks got going at their present scale, hospital admissions for malnutrition have increased by 74%? What are the Government going to do about that?
Lord De Mauley
My Lords, we are working with business and others to encourage people to adopt a healthier diet. Industry is making voluntary pledges to cut salt, fats and calories, increase uptake of fruit and vegetables and label nutrients and calories on packs in out-of-home eating places. Of course, there are a number of other initiatives to do with school food.
The Lord Bishop of Gloucester
My Lords, research by Citizens Advice shows that the main reason people are referred to food banks is delay in the payment of benefits and benefit sanctions; anecdotally, this is also the church’s own experience from its involvement in the many food banks it helps to run across the country. Will the Minister tell us whether the Government are persuaded by this evidence and, if they are not, will he share with us what plans they have to carry out their own research into the reasons leading so many people to seek food aid?
Lord De Mauley
My Lords, I very much acknowledge the right reverend Prelate’s question. While it is right to expect that claimants who are able to look for or prepare for work should do so, a sanction will never be imposed if a claimant has good reason for failing to meet requirements. If claimants demonstrate that they cannot buy essential items, including food, as a result of their sanction, they can claim a hardship payment. No claimant should ever have to go without essentials as a result of a sanction.
Baroness Royall of Blaisdon (Lab)
My Lords, food banks in the south-west gave emergency food aid to more than 40,000 adults and 20,000 children in 2013. Does the Minister believe that this is supply-driven or down to desperate, pressing demand caused by a cost of living crisis? If he is unsure, perhaps he would accept an invitation to join me on a visit to my local food bank, or perhaps to the one in Gloucester, to investigate.
Lord De Mauley
My Lords, I have indeed visited a local food bank near my home within the past few months. I was reminded that food banks are run by wonderful people and donated to by hugely generous folk. They perform a very valuable service, distributing food to people who really need it, and they tend to operate at a local level. Britain has a great tradition of charitable giving, and it would be a bad day on which we started to interfere with that.
Lord Palmer
My Lords, there was some confusion with the right reverend Prelate. I did in fact ask the Minister whether he agreed that it is surely a scandal in today’s society that food banks have to exist at all.
Lord De Mauley
I think I have just answered that, my Lords. Britain has a great tradition of charitable giving, and it would be a great mistake to interfere with that.
Baroness Parminter (LD)
Can my noble friend say whether the Government have any plans to commission any of the research indentified in the conclusions of his own department’s recent review of food aid in order to inform and support the voluntary groups providing food aid?
Lord De Mauley
My Lords, we are not proposing to record the number of food banks or the potential number of people using them or other types of food aid. To do so would place unnecessary burdens on the wonderful volunteers trying to help their communities. The report is a useful summary of evidence from providers and charities. The provision of food aid ranges from small, local provision through to regional and national schemes. The landscape is mostly community-led provision responding to local needs. It is not the Government’s role to tell them how to run the services they provide.
Baroness Farrington of Ribbleton (Lab)
My Lords, the Minister said that the answer to the problem of people using food banks is for them to be in employment. Without doing research, how on earth can the Minister justify that statement? So many people are working and using food banks—those on zero-hours contracts, et cetera. Is the Minister aware that, in many parts of the country, food banks cannot accept food that needs cooking because those using food banks have had their power cut off through poverty?
Lord De Mauley
My Lords, the noble Baroness raises a number of issues, and I am not going to have time to do them all justice. She raises the issue of the working poor, and she is right to do so. We agree, as I said earlier, that some of the poorest households in the country are struggling. That is why, for example, we are increasing the minimum wage and increasing the personal tax allowance, taking 3.2 million people out of income tax altogether. That is why we have frozen fuel duty and why we have helped local authorities freeze council tax.
Lord Tebbit (Con)
My Lords, would my noble friend not agree that there is always a near-infinite demand for valuable goods that are given away free? One can notice it even in the catering departments of this building. If food is given away at prices grossly below market value, more is used. Would my noble friend initiate some research into the sales of junk food in the areas where people are relying for their basic foods on food banks?
Lord De Mauley
No, my Lords, we will not. It might be worth adding to the debate that, as part of its 2014 report on social indicators, the OECD reported that in the United Kingdom there had been a decrease in the number of households reporting that they had felt unable to afford food over the past 12 months when compared to 2007.
Nuclear Management Partners
Lord Hoyle
To ask Her Majesty’s Government why the Nuclear Decommissioning Authority, rather than the Government, took the decision regarding the extension of the contracts of Nuclear Management Partners.
The Parliamentary Under-Secretary of State, Department of Energy and Climate Change (Baroness Verma) (Con)
My Lords, the decision on contract extension was for the Nuclear Decommissioning Authority, in line with its duties and responsibilities under the Energy Act 2004. Ministers were consulted and endorsed the decision before it was announced. Rolling the contract forward represents the best way forward at this time, giving the opportunity for NMP to build on the progress made to date, to address weaker areas of performance and to make further real progress in the next five years.
Lord Hoyle (Lab)
The decision to extend the contract of Nuclear Management Partners was taken despite its poor performance, undue delays and the fact that the costs are spiralling out of control—it will cost £70 billion to decontaminate six square kilometres. It is well over budget, by £2 billion. When the original decision was taken to give NMP the contract, it was taken by Ministers, so why did Ministers dodge the issue this time?
Baroness Verma
My Lords, I reassure the noble Lord that we did not dodge the decision. We have taken advice through the work done by the NDA, and my officials were involved in the review throughout the process. The decision made by the NDA was to see this contract go for a further five years to build on the work that has already been done. I remind noble Lords that 90% targets have been reached by NMP in the past five years. It is an incredibly difficult site, as the noble Lord is aware. Of course, there are extremely difficult challenges facing it, and a lot of it has been due to long-term neglect.
Lord Teverson (LD)
My Lords, Nuclear Management Partners spends £1.6 billion of taxpayers’ money each year on the decommissioning process, yet it is in an area that is still one of the most deprived in the United Kingdom. What pressure are the Government putting on that organisation to make sure that it builds up local skills and supply chains to the benefit of the people of Cumbria?
Baroness Verma
My Lords, I absolutely agree with my noble friend. I assure him that the Energy Act 2004 requires the NDA to consider those very impacts on communities that live nearby. On the example of Sellafield raised by my noble friend, more than 10,000 local people are employed by Sellafield Ltd and there is more than £1 billion of spend. According to the 2011 figures, one-third of that was on local businesses and the supply chain in west Cumbria.
Lord Elton (Con)
My Lords, the letting and continuation of contracts is a highly sophisticated operation, which can have a huge effect on the amount of money needed to run an operation. Where does the Minister’s department get the skills to do this?
Baroness Verma
My Lords, I remind my noble friend that the skills in the department and the skills that we bring in from outside are hugely specialised in this area. We are gifted with having some of the greatest minds in the nuclear sector within this country, and we should be very proud of that. We have an absolutely fabulous regulator, which is seen in the world as one of the best. So I do not want to undermine the great skills that we have, but we draw on skills from outside the sector, too.
Lord Hunt of Kings Heath (Lab)
My Lords, clearly we have a lot of skills in the nuclear sector in the UK, but let us go back to my noble friend’s Question. The fact is that in recent years the performance of the Nuclear Decommissioning Authority has been very disappointing, particularly as regards Sellafield. The question is this: given that disappointing performance, should it not have been a question for Ministers as to whether the NMP contract was extended? Why did Ministers not take that decision?
Baroness Verma
My Lords, I will return to my first Answer. Ministers were cited after a full review by the NDA and my officials were in on that review; we have been kept informed at every juncture. The decision to go forward with this contract is absolutely right. We are building on the work that has been done. Noble Lords from across the Chamber cannot take lightly the challenges facing the Sellafield site. We are discovering things that were not properly characterised in the inventory and so we have to deal with new challenges as well as with the current ones. We are in a position to see, review and make sure that progress is being made.
Lord Cunningham of Felling (Lab)
My Lords, I had the honour to represent the constituency that included the Sellafield site for 35 years in the House of Commons. I agree with the Minister that these are very complex issues. However, is it not a sad reflection on the decline of our once world lead in civil nuclear power? Sellafield was the biggest single yen earner in the British economy. Now the lead partners in this whole programme—which is crucially important to west Cumbria and way beyond—are not British; they are American.
Baroness Verma
My Lords, the noble Lord is absolutely right to raise those points. However, I remind noble Lords that for a very long time there has been little certainty for the nuclear sector. At least this Government have taken that certainty forward.
Lord Avebury (LD)
My Lords, can my noble friend confirm that the NDA can sack Nuclear Management Partners at any time it chooses during the five years and that the NDA has to maintain the capability in taking over from NMP in managing contracts?
Baroness Verma
My noble friend is absolutely right. NMP can of course be sacked. We are looking at making sure that what is being delivered is performance-related. If no good, reasonable progress is made, then we will have to look at other options.
Female Genital Mutilation
(10 years, 9 months ago)
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Lord Dobbs
To ask Her Majesty’s Government what are the impediments to bringing prosecutions in cases of female genital mutilation.
The Advocate-General for Scotland (Lord Wallace of Tankerness) (LD)
My Lords, the Crown Prosecution Service can consider prosecuting only those cases that have been referred to it by the police following an investigation of a number of significant factors affecting the reporting of female genital mutilation. Those include a lack of information from affected communities and the age and vulnerability of the girls and women, which prevents them from coming forward to report offences or to give evidence in court. However, your Lordships’ House should be in no doubt that the Crown Prosecution Service is working hard to bring a successful prosecution.
Lord Dobbs (Con)
I thank my noble and learned friend for the encouraging reply and initiatives the Government have been taking. However, he will understand when I say that these are not yet enough. Female genital mutilation is a crime. It is estimated that 66,000 women and children in England and Wales are victims, yet there has not been a single prosecution. Can my noble friend assure the House that, while we are rightly sensitive to the interests of minority cultures, the Government will never neglect our fundamental British culture, which deems that this practice is little less than butchery and must be stopped? While the Minister rightly emphasises the role that education has to play in stamping out this practice, will he accept that by far the best way of driving this lesson home and saving as many innocent women and young girls as possible is to ensure that those responsible are identified, prosecuted and locked away, where they can do no further harm?
Lord Wallace of Tankerness
My Lords, there is widespread frustration that there has been no prosecution, albeit that there has been legislation on the statute books since 1985. At present, the Crown Prosecution Service is considering or advising the police on 11 cases, four being re-reviews of cases that had previously been considered and where a decision was made that no further action should be taken. My noble friend is absolutely right: this is a crime. It is a very serious form of violence against girls and women and is a form of child abuse. I assure my noble friend that the criminal law applies to everyone, without exception.
Baroness Butler-Sloss (CB)
My Lords, ought not the Government look beyond the CPS at teachers in schools, and particularly the college of GPs, and ask GPs to check girls in certain minority communities to see whether or not they have been victims of this practice? This really needs to be done. It is not up to the CPS to do this; it cannot proceed unless it has the relevant evidence. We need to go to the core groups that deal with these children, particularly the college of GPs.
Lord Wallace of Tankerness
My Lords, the noble and learned Baroness is absolutely right: the Crown Prosecution Service can take only cases referred to it by the police. In turn, the police require co-operation and engagement on the part of those involved in schools, education, the health service, including GPs, and, indeed, the communities themselves. That is why there is a range of activities across government, agencies and the third sector to try to raise awareness and improve lines of communication so that cases can be reported with more confidence.
Baroness Smith of Basildon (Lab)
My Lords, the Minister’s answers are very clear, and I agree entirely with the noble Lord, Lord Dobbs, and the noble and learned Baroness, Lady Butler-Sloss. It is clear that legislation alone has not been an adequate deterrent. However, the French system works particularly well, whereby young girls who present to hospital are examined to see whether they are victims of FGM. We would not necessarily want to go down that route but, given that it has been successful, will the noble and learned Lord take on board the comments made by the noble and learned Baroness, Lady Butler-Sloss, but also look at other ways of addressing this issue, including involving hospitals and other agencies which could bring evidence to the attention of the CPS to ensure that we get a prosecution, as that will be the only genuine deterrent that will really make a difference?
Lord Wallace of Tankerness
My Lords, the noble Baroness mentions France. My understanding is that there is no specific crime of female genital mutilation in France. Nevertheless, I think that other issues are involved there which are somewhat different. However, I reassure the noble Baroness that the Crown Prosecution Service is looking at experience in different jurisdictions to try to get information on best practice. With regard to hospitals, which she mentioned, as from next month there is intended to be a reporting requirement from hospitals of cases which they discover, and a database will be built up. It is important to remind those involved that there is a legal obligation on NHS staff to safeguard children and young people and that, if they identify someone they consider to be at risk, or who has already undergone FGM, they must respond appropriately by involving the social services, which, in turn, can involve the police.
Lord Lester of Herne Hill (LD)
My Lords, this morning the BBC revealed that, since 2009, some 4,000 patients have been treated in London hospitals for the after-effects of FGM. Clearly, this is a very widespread and serious health problem. Will my noble and learned friend look at our own jurisdiction with regard to civil protection for forced marriages and consider whether, instead of relying only on the criminal process, with the difficulty of the burden of proof and all the rest of it, it might not be sensible instead to amend the law to ensure that civil protection orders can be imposed in the family courts, as in the case of forced marriage?
Lord Wallace of Tankerness
My noble friend makes an important point. Last month, there was a round-table discussion involving Ministers, the Crown Prosecution Service, the Director of Public Prosecutions and a whole range of government departments which have an interest in this issue. The fact that this matter goes across a number of departments has been reflected in the questions asked today. One of the action points to be taken forward by the Ministry of Justice is to seek views on how a civil prevention order might work alongside criminal legislation to protect potential victims because protection—preventing it happening in the first place—is vital, as well as prosecuting those who have perpetrated this offence.
Baroness O'Cathain (Con)
My Lords, I ask the Minister whether these girls have any access to confidential information. For example, we have ChildLine, Rape Crisis, services for battered wives, and all those areas where people can, if they are in positions like this, phone up and get some help and assistance. I have never heard of one for this bestial practice. Is there any charity that we could approach and ask?
Lord Wallace of Tankerness
My Lords, I can reassure my noble friend that the NSPCC has in fact initiated a helpline, in co-ordination with the Home Office. Perhaps one of the issues is the need for greater dissemination of that. Another recent initiative has been the issuing of a statement opposing FGM, of which 41,000 copies have been sent out in over 11 languages to raise awareness and to bring this issue to the attention of those who have been victims. One of the issues that has been looked at by the police and the Crown Prosecution Service is that, for those victims who do come forward, the appropriate witness protection is in place to give them reassurance and to help them. People obviously have been very brutally treated.
NHS: Bed Capacity
(10 years, 9 months ago)
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Lord Hunt of Kings Heath
To ask Her Majesty’s Government what action they are taking to prevent hospital patients being moved in the middle of the night to relieve pressure on beds.
Lord Hunt of Kings Heath (Lab)
My Lords, I beg leave to ask the Question standing in my name on the Order Paper, and refer noble Lords to my health interests.
The Parliamentary Under-Secretary of State, Department of Health (Earl Howe) (Con)
My Lords, moving patients between wards overnight should happen only for good clinical reasons, because it can be a distressing experience for them and their families. We have asked NHS England’s medical director, Sir Bruce Keogh, to write to all hospital trusts requesting that they minimise transfers that are not aimed at improving patient care. As the Government’s response to the Francis inquiry highlighted, listening to and learning from patients to improve care is a top government priority.
Lord Hunt of Kings Heath
My Lords, it is all very well the Minister’s telling the NHS not to do it any more, but does he agree that the real problem here is the pressure on hospital services, particularly on A&E services, which then leads to a desperate search for beds, which then causes patients to be moved in the night time, as this survey has reported? Do Ministers have a response to the more general issue of the acute pressures on our acute hospitals at the moment?
Earl Howe
My Lords, many hospitals have been under pressure, particularly during winter, as they always are. It is telling that if one looks at the tell-tale signs of pressure, such as bed occupancy, the rates have remained stable for a number of years. In fact we have more clinical staff on the front line, particularly in A&E, than we had a few years ago. There is no doubt that there are times when hospitals feel acutely under pressure. However, despite rising demand, average waits for assessment in A&E are around 30 minutes at the moment, compared with over 70 minutes in 2009-10.
Lord Laming (CB)
My Lords, would the Minister use his good offices to reinforce again with the National Health Service that all unplanned moves that are not determined by clinical need, be it during the day or at night, have the potential to cause disorientation to patients and considerable distress to their relatives?
Earl Howe
The noble Lord is absolutely right. That is why my ministerial colleague, Dr Poulter, has written to Sir Bruce Keogh. This issue lies at the heart of the NHS constitution: the patient’s dignity and shaping care around the needs and preferences of patients is absolutely at the centre of the constitution. This is why it is entirely appropriate for Ministers to make their views known and for Sir Bruce to ensure that all hospitals are aware of this principle.
Baroness Barker (LD)
My Lords, does the Minister agree that it is possible to discharge patients from hospital in the evening safely and that there are some patients for whom that is the best clinical option, but that hospitals are not good at ensuring that frail older people are discharged at the best time when they live on their own? Could he include that in the review carried out by NHS England?
Earl Howe
My noble friend is quite right. As she knows, there are far too many frail elderly people who end up in hospital in the first place. We must get better at the discharge arrangements for them and not keep them in hospital too long. This is the focus of much of the work going on in the department and NHS England at present concerning vulnerable older people. We will announce a comprehensive plan around this later in the year.
Baroness Masham of Ilton (CB)
My Lords, apart from distressing patients, is not moving them around bad for infection control, particularly if the beds are not properly cleaned?
Earl Howe
Yes, my Lords. As ever, the noble Baroness makes an extremely good point. It is heartening that infection rates have come dramatically down in hospitals over the past few years, but we can never be complacent and it is important that when a patient is moved the infection question is always considered.
Lord Turnberg (Lab)
My Lords, is it not the case that we have the lowest number of beds per head of population of any OECD country, bed occupancy rates of approaching 90%—a dangerously high level—and, despite all that, the shortest lengths of stay of any European country? Does the noble Earl agree that the idea of closing wards or hospitals can only worsen the situation, unless, of course, we are able to build up the community services before we do any of that?
Earl Howe
I agree with the principle that the noble Lord has articulated. Certainly, commissioners and providers of care should reduce beds only where it is clinically safe and appropriate to do so. The NHS is very experienced at flexing the number of beds it has available; it does this every year and every winter. As a principle, I would agree with the noble Lord but I come back to the point that bed occupancy rates have, in fact, remained stable over the past 10 years, fluctuating between 84% and 88% on average, and increasing slightly over the winter period.
Lord Geddes (Con)
My Lords, further to the question from my noble friend Lady Barker, is it mandatory for the NHS to advise next of kin before discharging frail patients?
Lord Hunt of Kings Heath
My Lords, can I come back to the point raised by my noble friend? The noble Earl will know that Monitor is requiring foundation trusts to make five-year plans ahead. My understanding is that almost all such plans made by acute trusts are predicated on reducing bed capacity in order to keep within the budgets that they are likely to have over that period. Can he assure me that as those bed numbers are reduced, community care and social care provision will increase in order to enable patients to be discharged appropriately?
Earl Howe
It is for that very reason that we are setting up the Better Care Fund as from April 2015, so that health and social care are more joined up, people are kept out of hospital and we can therefore safely reduce the number of beds. We have to take an all-systems approach to this; it is no good looking at one part of the system—health and social care have to be looked at together.
Employment
(10 years, 9 months ago)
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Lord Freud
That this House takes note of the level of employment in the United Kingdom.
The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Freud) (Con)
My Lords, it is appropriate that we should be debating the labour market today after yesterday’s figures showing record numbers of people in work and unemployment down again.
I believe that we will benefit from having a frank and open discussion. We have seen exceptional progress in recent months, but we know there is more to do and we must not be complacent. Indeed, the performance of the labour market in the recent recession can be seen as something of a puzzle. Previous recessions saw dramatic falls in employment. Yet despite this being, on some estimates, a deeper recession than in the 1930s, we did not see the number of people in work fall anything like as much as the experts predicted. GDP fell by more than 7% but the number of people in work fell by only one-third of that. I have yet to see a full and convincing explanation for why employment did not see the fall expected. There probably is no single reason. Active labour market policies and the flexibility of our modern labour market, as well as the bitter experience of those who went through past recessions, may all have played a part.
The resilience of the labour market in the recession has been matched by robust improvement now that we are getting the economy back on track. There are 1.3 million more people in work since the election, and more than 30 million people are working—more than ever before. In fact, if you exclude full-time students, the employment rate is now back to the peak that we saw before the last recession, and we have had further good news, with the female employment rate now at an all-time high.
I am often struck by what appears to be a widening gap between the impression that people have about the labour market and the reality of these figures. Many predicted that the fall in public sector jobs would not be matched by an increase in the private sector. They were right, but not in the way they expected. The rise in private sector jobs has not just matched the fall in the public sector but has far exceeded it—up nearly 1.7 million, with total employment up by 1.3 million as a result. Recently, there were reports that most of the growth in private sector jobs since 2010 has been in London. When I asked my officials whether that was true, I received a surprising response. Using already published and easily accessible data from the Office for National Statistics, the true position is almost the complete opposite. Nearly 80% of the rise in private sector employment has been outside London.
We are regularly challenged on the rise in long-term unemployment, particularly among young people. Long-term unemployment is a scourge, and through the Work Programme and the Youth Contract we have put in place just about the most comprehensive response that has ever been seen. Yet what those who criticise our record fail to mention is that the previous Government hid long-term unemployment by artificially removing people from the claimant count. They shifted people about to become long-term unemployed on to training allowances or into short-term job schemes, taking them off benefit in the process. We have put a stop to those methods, so now the figures are a true count of the number of long-term claimants. What really worries me is that the Opposition’s proposed jobs guarantee would result in the exact same problem, with long-term unemployment misrepresented as people are shifted off the claimant count.
People are rightly concerned about the effect the recession has had on young people. However, if we are to tackle youth unemployment, we need to have an understanding of where the real problem lies. When people talk about a “lost generation” of 1 million young unemployed, they are including those in full-time education, who make up nearly a third of the total. In fact, one young person in every 10 has left full-time education and is unemployed, and this proportion is the same for all under-25s and for those from an ethnic minority. This means that youth unemployment remains significantly lower than after past recessions: 9% of young people have left full-time study and are looking for work compared with 12% in 1993 and 14% in 1984. When it comes to NEETs—young people not in any form of education or work—we are not where we want to be, with a higher NEET rate than in many other EU countries. This is mostly due to lower participation in education in the UK. Although the NEET figures are now improving, this is something that the Government will continue to address. The other side of the picture shows that, among 20 to 24 year-olds who have left education, our employment rate outperforms the US and the EU average, and that, of the large EU economies, we are second only to Germany.
I should like to move on to some of policy responses we are making to the main labour market challenges that this country has been facing. It is unheard of for inactivity to fall in a recession, yet that is what has happened. Excluding students, inactivity is currently the lowest on record. The number of people claiming inactivity benefits has fallen by nearly 350,000 since 2010. People are better off in work and we did not want to repeat past mistakes by allowing people to drift into inactivity. Maintaining an active labour market policy ensures that people do not become detached from the world of work and are well placed to benefit as the economy picks up. We are changing the culture. People who can work are expected to work and, with our support, employment is rising. But challenges remain. Although falling, there is still a working age inactivity rate of more than 22%.
We have been successful in getting lone parents into work and have a record lone-parent employment rate. Before November 2008, lone parents could claim income support until their youngest child reached 16 years of age. This child age threshold has been progressively reduced and now stands at age five, and we are introducing additional measures best to support parents to prepare for work when their child is old enough. As noble Lords will be aware, the Prime Minister and Deputy Prime Minister announced further measures to help hard-working families. These included bringing forward a childcare package that will provide tax-free childcare for almost 2 million families. This will help parents go out to work and provide more security for their families.
Our reforms to the benefit system are a key part of the Government’s long-term economic plan to build a stronger economy and secure a better future. Much of our effort has been focused on improving the support available for people who are on sickness benefit but able to work to enter or rejoin the labour market. We are not just writing off people on long-term sickness benefits, as happened in the past. We believe it is only fair that we look at whether people can do some kind of work with the right support—support offered by Jobcentre Plus, specialist provision or through the Work Programme. We need to ensure that the longer-term unemployed do not drift away from the labour market. That is what happened in past recessions, with worrying consequences. It is because we are not going to allow that to happen again that we are investing in the Work Programme. That is expected to provide personalised support to more than 2 million claimants over the life of the contract.
The Work Programme is the largest employment support programme that Britain has ever seen, with far more financial risks sitting with the provider. Payment is by results, with higher payments for getting those with the biggest barriers to employment into sustained work. The Work Programme is better designed than previous employment programmes and is supporting more people into sustained work. Industry figures show that the Work Programme has already helped nearly 500,000 people into work and, of these, more than 250,000 have escaped long-term unemployment and got into lasting jobs. While all contracts are on track to hit their contractual JSA targets, there is significant variation in performance. The worst performing providers are being tightly managed to ensure that they up their game. One contract has been terminated. For the first time, a government employment programme is harnessing the disciplines of the marketplace so that only those providers who succeed are retained to help claimants into work.
Of course, young people still face many challenges, particularly in making that important transition from school to work. Youth unemployment is falling but we need to continue working to bring it down in the aftermath of the recession. We need to ensure that young people have the experience and skills that they need to succeed in the labour market. The Government are raising the participation age so that all young people are now required to continue in education and training beyond the age of 16. We are also implementing wide-ranging policies to improve standards in schools, reform post-16 academic and vocational education and ensure that apprenticeships continue to meet the needs of a modern labour market. We have a wide range of programmes, including those funded by the European Social Fund, and the Youth Contract, to support young people who are NEET to return to full-time education, training or employment.
In a recent report commissioned by Tesco, 60% to 70% of young people said that they had concerns about lack of experience. Many said that they wanted more help from business and struggled with CV writing. That is why it is so important that, through Jobcentre Plus, young unemployed people are given the opportunity to be referred to a careers interview with the National Careers Service. They can also work with local employers who offer work experience and pre-employment training to give them the chance to build up their CVs and job skills.
Apprenticeships play a vital role for many young people, helping them at the outset of their working lives to progress their careers, and the Government offer a £1,500 grant to smaller businesses to take on their first apprentices. Yesterday, the Chancellor announced an extension of this scheme. The Government will now be making more than 100,000 additional incentive payments for employers to take on young apprentices aged 16 to 24, providing a major boost to their job prospects. Traineeships are a new programme to help young people aged 16 to 23 to develop the skills and vital experience that they need to secure apprenticeships and other sustainable jobs.
This Government continue to support economic growth across the regions and help to create the conditions for businesses to feel more confident in hiring more people. Private sector employment has been rising across the UK, and we need to ensure that this continues. To satisfy the recruitment needs of employers, Jobcentre Plus and Work Programme providers use their local labour market knowledge and expertise to improve claimants’ skills and readiness for work. Local enterprise partnerships, in England, provide the vision, knowledge and strategic leadership needed to drive private sector growth and job creation in their areas. Through our strong local offer, Jobcentre Plus district managers work with local enterprise partnerships to ensure that their strategic economic plans make the important link between growth, unemployment and social exclusion. In Humber, Jobcentre Plus and the local enterprise partnership have mapped local and national employment support services and identified where they need locally to plug the gaps.
Developing City Deals has provided a blueprint for working together and co-designing local initiatives. Cities are being given greater freedom to invest in growth and enterprise and being given greater powers, including the power to boost skills and jobs. In Leeds, DWP supports the city region to achieve its aim of being a NEET-free city. Its plan is to enable small businesses to provide apprenticeships when they would not normally have the capacity to do so. The aim is to deliver 680 apprenticeships over three years.
My 2007 independent report on the future of welfare, Reducing Dependency, Increasing Opportunity: Options for the Future of Welfare to Work, came on the back of a long-term aspiration to secure an employment rate of 80%. On the basis that the ONS now defines it—looking at those aged between 16 and 64 rather than between 16 and 59 for women—today this would be equivalent to an employment rate of around 78%. Clearly, a lot has happened since then, not least the deepest recession in nearly a century. Our first aim must be to regain the ground lost in the recession, which would mean a rate of 73% against the current level of 72.3%. It is interesting to speculate that, because most students are outside the labour market, rising participation in education makes it harder to achieve higher levels of employment. But, of course, it is no bad thing to see more young people in education. So, adjusted for that higher participation in education, that 80% employment rate probably translates today into a level some three percentage points higher than the 72.3% that we are currently looking at.
Lord Bates (Con)
My Lords, I understand that, by convention, the mover of the Motion is given the opportunity to be uninterrupted and then can respond to questions in the wind-up.
Lord Freud
My Lords, that is three percentage points higher than the figure of 72.3% that was reported yesterday. That gives a feeling of the factors that we have been looking at over the past seven or eight years. As I said, that extremely challenging outcome implies that any employment strategy would need to target all of the inactive groups. Noble Lords will be pleased to see that, since 2007, the number of people on inactivity benefits has fallen by around half a million. The economy is now recovering and creating new jobs, making this a once-in-a-generation opportunity to help those who have been trapped on welfare to return to work. It is in that light that I would ask noble Lords to view the Government’s welfare reform ambitions. I beg to move.
Baroness Donaghy (Lab)
My Lords, I thank the Minister for initiating this debate, and in doing so, I note that he is much admired for the way in which he steered the Welfare Reform Bill and the Pensions Bill—two of the most difficult Bills in Parliament—through this House. In fact, I think that he is more appreciated by this side of the House than he is by his own party. I say this because my contribution is not very supportive of the Minister’s claims and I wanted to place on record my admiration for him before I rubbished his thesis.
I understand why there is a great deal of celebration from the coalition Government about the level of employment. However, the increase in inequality, the way we treat our young people, the way we treat public sector workers, the increasing economic fragility of people’s lives and the experience of most women in terms of income and childcare mean that there is absolutely nothing to celebrate. The economy is nearly 2% smaller than it was at the end of 2007. Looking at the very short term, it is true that the number of unemployed actively seeking work has shrunk by 250,000. I accept that. However, there are still 770,000 more people unemployed than at the end of 2007—a total of 2.4 million. That represents little change from May 2010. Unemployment has averaged nearly 8% since 1980. So we have to ask how—or even whether—the economy can bring that level down to the 2% we had for 25 years after the Second World War. We had growth averaging 3% a year for more than 60 years. Achieving that over a period of time under current government policies is beginning to look unlikely.
Then we have low productivity. Firms have survived by shelving investment and paying their workers less. This might work in the very short term but it will not lead to growth. George Osborne knows that low productivity has slowed growth and will continue to do so. The Financial Times has used the Office for Budget Responsibility’s own model to show that the £85 billion deficit target in 2013-14 will actually be £111 billion.
The Government’s headline increase in apprenticeships is positive on the face of it, and of course it makes the unemployment figure look better. However, the reality is very different. The minimum wage rate for an apprentice is £2.68 per hour. Although it is a positive step to acquire skills and work experience, when the wages are under £100 a week before travel costs and bills, it starts to look less attractive—and if those apprenticeships do not lead to a job, it breeds cynicism and despair. Most of the new jobs in the service sector are filled by young, unskilled workers on short-term, part-time and zero hours contracts, which is a guarantee that low productivity will persist. The impact on young people is extremely worrying.
The latest survey from the Prince’s Trust confirms what some of us know already. Young people are having a tough time finding security and fulfilment—unless they come from a privileged background. Some 9% of respondents to the survey said that they had “nothing to live for”, and one-third of young unemployed people have considered suicide. Clearly, there are other factors such as an increase in homelessness, poor careers advice and the break-up of families, but we cannot be proud that in this country a large proportion of apprenticeships are just an excuse for cheap labour, or are of poor quality and short duration. The Government’s own research shows that one in five apprentices receives no on-the-job or off-the-job training, and 25% are paid less than their legal entitlement. The Work Foundation has found that, despite the range of skills that are deemed necessary for a career in social care, only around one-third of health and social care apprentices receive both on-the-job and off-the-job training, and one-fifth report receiving neither. It is no coincidence that most new claimants of housing benefit are working rather than unemployed.
A Manpower survey shows that job prospects are better than they have been for six years, in particular in the building industry, the utilities and large companies. If that leads to more jobs for skilled workers, it may help productivity, but if it represents more low-paid, temporary and unskilled work, it will disguise the real problem. The Government have made much of the fact that private sector jobs have increased by 1.5 million and that that has made up for the loss of jobs in the public sector. Even if we discount the tragic loss of skills and commitment to public service that that represents—a hollowing out of the Civil Service and local government, and unsustainable pressure on health service staff—the figures hide blatant exploitation of workers and the prevalence of low pay, particularly among women workers. Some 11 million people have had no increase in real earnings since 2003.
The Government have also made much of the increase in self-employment. Research by the Office for National Statistics shows that women have made up more than half of the 10% growth in self-employment since the recession began. If this represented an increase in business start-ups and thrusting entrepreneurs, we would all be cheering, but the reality for most is very sobering. According to HMRC, in 2011-12 the average income for a self-employed man was £17,000. Even taking account of the ability to offset a large proportion of costs and expenses if you are self-employed, that is still a surprising figure. The average for women, however, was £9,800—40% less than men. In almost every region apart from London, the south-east and Scotland, self-employed women earned less than £10,000 a year. This suggests a great deal of substitution from low-paid employment to low-earning self-employment.
A recent report by the Women’s Budget Group notes that much of the increase in women becoming self-employed is effectively because of precarious work and zero-hours contracts rather than because of the creation of new businesses. Scarlet Harris, a spokesperson for the group, said:
“Clerical, cleaning and caring work, which is predominantly carried out by women, has experienced some of the fastest growth in self-employment in recent years. These women, who already suffer poverty rates of pay, are now having to contend with the poor working conditions and complete lack of job security that self-employment brings. These shocking gender pay gap figures should end any delusions people have about the UK’s four million self-employed workers”.
A BBC investigation last month found that advisers are encouraging individuals on welfare-to-work schemes to become self-employed in order to move them from unemployment benefits to working tax credits. Has the Minister investigated this matter? If so, how does he plan to deal with it?
Not only is the gender pay gap widening for the self-employed, but ONS figures show that the gender pay gap as a whole in the UK widened in 2012 for the first time in five years, from 9.5% to 10%. The Chancellor of the Exchequer said that the recent Budget is for,
“the makers, the doers, and the savers”.—[Official Report, Commons, 19/3/14; col. 794.]
He should have added—“and young people and women can push off”.
Finally, I do not believe that we can win a race to the bottom. We need high-quality jobs, investment in manufacturing and good-quality training and careers advice. The World Economic Forum in Davos concluded that the biggest threat to prosperity in the next decade was the increasing gap between rich and poor. This Government are following a path that will ultimately fail, at enormous cost to people’s security and aspiration. It really is a case of, “Never mind the quality, feel the width”.
Lord Shipley (LD)
My Lords, I, too, thank the Minister for enabling us to have this debate because it gives us an opportunity to look at the levels and nature of employment in the UK, not least from the perspective of region and age. The context overall is one in which austerity, inevitably, is still with us, in that borrowing this year will be more than £100 billion. Government debt is still rising so there are limits on what the Government can afford to fund.
I listened very carefully to what the noble Baroness, Lady Donaghy, said. I will simply say in response to the list of criticisms of the Government—which was a self-selected list because it missed out a whole range of things that indicate a trend towards a higher rate of quality employment—one would think that the financial crisis had nothing to do with the Labour Government up until 2010. This Government have had to deal with a huge financial crisis in a very serious recession and the level of employment we have today is quite remarkable given the record of the previous Government and what this Government have had to do.
I say that otherwise one would be led to think that this was a story of entirely bad news and it is not. The green shoots of growth and recovery are there. Figures published yesterday by the Office for National Statistics show that the number of people in employment has risen to 30.19 million and that the level of unemployment has fallen again by 63,000 to 2.33 million in the three months to January this year. Compared with a year ago, the numbers in employment have grown by more than 450,000. That is a very encouraging figure. A higher percentage of the adult population in the UK is now in work than in the United States of America. Unemployment is down to 7.2%, falling well below its peak, and below the current levels in most European countries. The unemployment rate in the European Union is 50% higher than here at 10.8%. It is true that more women are employed now in the UK than ever and that 95% of all jobs created last year were full time. The trend data also show that youth unemployment is now falling and has already fallen to a level lower than when this Government came into office four years ago. That is a very important achievement, and we should say so. However, that is not to say that there is a lot of further work that needs to be done, because it is undeniably the case that youth unemployment remains far too high.
I join the Minister in saying that it is very important that we note the impact of the Budget. I realise there is a debate on this next week, but it is highly relevant to this debate, because yesterday’s Budget is a Budget for employment. It has been described in the media as very much a Budget for savings and pensions, and in one respect that is true, but actually it is a Budget for employment. There are several reasons why I think that is the case. First, it will help to drive exports even more, giving British businesses access to the most competitive export finance support in Europe, because the UK’s direct lending programme has been doubled in the Budget to £3 billion. Secondly, it is cutting energy prices for business, particularly for the most energy-intensive manufacturers, around 80% of which are based in the north of England, Scotland and Wales. There will be increased incentives for companies to return manufacturing from abroad to Britain. Thirdly, there is increased financial support, through the tax regime, for capital investment and for research and development. Fourthly, there is more support for apprenticeships, which I will look at in greater detail in a moment.
I noted the comments by the noble Baroness, Lady Donaghy, about childcare, but we should remember that it was announced earlier this week that as many as 1.9 million working families could benefit from a tax-free childcare allowance worth up to £2,000 per child, up to the age of 12. Taken together, all these measures will help business growth, increase the number of jobs and increase the number of people in work and able to work. The Office for Budget Responsibility has said that employment will rise to well over 31 million by 2018, which seems a reasonable prediction based on what we know today.
I will now focus on unemployment and what will happen there. Unemployment stands, as I said earlier, at 7.2%. I was very concerned early last summer when the Governor of the Bank of England said that the Monetary Policy Committee would look at the case for increasing interest rates when unemployment reached 7%. My concern was that 7% is an average UK figure and that parts of the country would be higher while others would be lower. Some parts of the UK have unemployment rates of over 10% and they need continued low interest rates to encourage investment. I was therefore very relieved when the Governor of the Bank of England revised his view and said that the unemployment rate should drop further before the Bank considers an interest rate rise. A substantial body of opinion thinks there is sufficient slack in the economy to permit this without impacting on the rate of inflation. It will certainly help to encourage growth in those parts of the UK with higher unemployment and will also help to secure more jobs for young people.
It is that issue that I want to take a more detailed look at. In official statistics, young people can be shown as employed full time, employed part time, employed and in full-time education, employed and in part-time education, unemployed, economically inactive, or not in employment, education or training. The detailed statistics can be complex to follow because the categorisations can vary depending on what you are looking at. What is not complex to follow—I agree entirely with the noble Baroness, Lady Donaghy, on this—is that too many young people are unemployed or underemployed. The trend, as I said earlier, is in the right direction and the Government should be praised for that, but I am grateful to the Local Government Association—I should declare that I am a vice-president of the LGA—for pointing out that 1.25 million young people are not working but would like to. Some of course are in full-time or part-time education, 760,000 are in work but would like more hours, and 425,000 are not working to their potential—for example they may be graduates in what are thought to be non-graduate jobs.
The Government are spending around £15 billion a year on young people and I welcome their ambition, which the Minister has explained to the House, to devolve skills and training to local enterprise partnerships and to local authorities and their partners. It is important because we need integrated employment services based on local labour markets. Only local networks can deliver that, as was highlighted by a number of City Deals, in which—as Members of the House might be aware—I have had an involvement.
Crucially, however, we have to remember the role of schools here. Schools have a statutory duty to provide a careers service, yet a few months ago Ofsted reported that three-quarters of secondary schools were not executing their statutory duties satisfactorily. This was followed by IPPR North’s report, published in January, which concluded that secondary school careers services were not equal to the task of helping students navigate the increasingly difficult transition from school to work. That report, entitled Driving a Generation: Improving the Interaction between Schools and Businesses, made a number of very helpful recommendations which I commend to the Minister because it proposed a means whereby schools and businesses could relate much better to each other. My point is that if the huge and worrying mismatch in skills is to be solved, the solution must be started in the place where young people learn in compulsory education, where they need to better understand the qualifications and skills required to enter an apprenticeship, particularly in science, maths and IT.
There is high demand from young people for apprenticeships, but there are still not enough employers coming forward to offer them. The average apprenticeship post receives 12 applications each, but in some sectors the level of demand is twice as high. I therefore welcome the extension in yesterday’s Budget of apprenticeship grants for employers, which will fund more than 100,000 additional incentive payments for employers who take on young apprentices. I also welcome the funding to support employer investment in apprenticeships at degree and master’s level. This will bring more employer engagement into the HE sector and expand apprenticeships at higher levels, where there are currently too few available qualifications.
I have two very brief points in conclusion. First, will the Minister and his colleagues look at the role of UKTI? In many respects it does a very good job. Its role in driving exports upwards is good, but it has a role in inward investment and no regional or sectoral targets to meet. It simply has UK-wide targets. It would help enormously if it actually had to produce an audit of where it has directed inward investment. My second point is about regional and local procurement. I have a constant concern that national procurement contracts are being driven by price and go to national companies headquartered in the south of England. I would like to think that we would always ensure, in all procurement by central and local government, that local people are employed, that local people are trained and that smaller local companies and social enterprises can tender for government contracts. I hope the Minister might be prepared to agree to undertake a constant audit of the outcomes of government national procurement policy and its impact on employment.
Lord Holmes of Richmond (Con)
My Lords, I thank the Minister for initiating this incredibly significant debate and for all the work that he has done across the work and pensions landscape, which has been ground-breaking and innovative. It is worth reiterating yesterday’s employment figures: there are more people in employment now than at any previous time; more people employed in the private sector than at any previous time; and more women in employment than ever before. Yesterday’s Budget was a Budget for jobs: employment is up; growth is up; the deficit is down by a third and by next year it will be down by a half. Could there be any greater evidence for that than the announcement this morning from Hitachi that it will base its global—yes, global—rail business in the UK?
It is one thing for employers to provide jobs; we also need to ensure that the skills and training are there so that our people, particularly our young people, are ready to take up those employment opportunities. To that end, I commend the work of my noble friend Lord Baker of Dorking with the university technical colleges and the work they are doing. All educational establishments should focus on not just a careers service but what is now known as employability. I suggest to the Minister that he should consider a potentially statutory obligation on schools, colleges and universities to the young people leaving them which would last until those young people enter the next stage of their journey, be it higher education, training or employment. In future, it should not be possible to have someone who is not in education, employment or training and who has nobody potentially looking out for, supporting and assisting them to take that next step—whatever the right step might be for them.
Working on the Olympic and Paralympic Games, we saw the opportunity to create hundreds of thousands of jobs, but also how there were gaps—particularly in the host boroughs—in finding people to fill those jobs and to drive employment in the local area as much as we all wanted. That will continue. When you look at iCITY, a brilliant redevelopment of the media centre in the Olympic park, there will be high-skill, high-tech jobs. We need to ensure that people have the right skills to be able to go into those jobs and to continue to work in their local areas. Similarly in terms of construction, there is the E20 village—the old athletes’ village—and the new plans at Ebbsfleet. In Scotland, there is the new town at Tornagrain. These will provide thousands of constructions jobs, engineering jobs and jobs across the economy. We need to ensure that people are ready, willing and able to take up those jobs. Similarly, across the massive infrastructure programme that we are rolling out under the careful eye of my noble friend Lord Deighton, there is again potential to drive economic growth and employment opportunities right up and down the country, but we need to have people ready, willing and able to take up those jobs.
UKTI has already been mentioned. Great work has been done but successive generations have relied far too much on the EEC, the EC and now the EU. Yes, Europe is a great market but it is not the only one. We have got nowhere near maximising our opportunities with the BRIC economies. When I was with the GREAT campaign down in Rio in 2011, I found that Italy exported many multiples more than the UK did to Brazil. Italy has no historical or language connection to Brazil but it has built up an effective, practical and meaningful trading relationship that has driven jobs, and not just in Brazil, for Italian businesses. We need to look at that, not just in terms of the BRIC economies but also the new MINT economies—Mexico, Indonesia, Nigeria and, not least, Turkey. Turkey is pretty much on our doorstep. To get a sense of the demographic there, take any western European advanced mature democracy and then turn that demographic on its head. That is the opportunity in Turkey. The majority of the population is under 25. Its economic growth is in double digits. Those people are purchasing and we need to ensure that they have the opportunity to purchase British stuff and so drive employment for our businesses right up and down the UK.
I turn to Scotland. Ultimately—in September—an incredibly significant decision will be made by the Scottish people, the most significant decision for the union in hundreds of years. It will not be simply a decision about their destiny, and it will not be considered only on the basis of Faslane. It will not be about oil, per se, and it will not be about the financial service industry in Edinburgh in isolation. It will be about jobs. It will be about employment. When Scottish voters put their cross in the box in September, I urge them not to think just about Scottish jobs; I urge them to think about English jobs and UK jobs, because that is what is at stake, and we will all benefit if we keep the union together.
In short, the Budget was about employment. It was about possibility. It was about potential. We are not out of the woods but we are on the right road. There is a long journey ahead of us. We need to drill into those employment figures, as has already been mentioned, and ensure that every area and region of the country is benefiting from this employment boom. We need to ensure that young people and disabled people are similarly benefiting and being enabled into employment. In short, we need to ensure, for all our sakes, that every person who is able to work is enabled to do so and that we provide real security for those who are not. It is in all our interests to drive this forward. What we should all be striving for is a high-employment, low-inflation, high-productivity, low-interest-rate, prosperous United Kingdom economy that is focused on and fit for the future.
Lord Giddens
My Lords, I, too, congratulate the noble Lord, Lord Freud, on having initiated this debate, and I congratulate him in a non-partisan way on his work on welfare and on other areas, such as mesothelioma, which has touched me and my family personally. I greatly appreciate his efforts in that discussion. He will be pleased to know that I do not propose to emulate my noble friend in trying to rubbish him, but I want to develop an analysis which is quite different from that which has been offered by noble Lords so far.
I shall argue that when considering the level of employment in the UK it would be a great mistake to concentrate only on the incipient economic recovery and the return of demand. As the Minister said, net new jobs are being created, and there is certainly a debate to be had, as my noble friend said, about what kind of jobs they will be, who will hold them, how many are part-time and so forth. However, I shall concentrate on much deeper structural trends which provide a much more sober picture than some of the portrayals being offered so far because some of these trends are utterly dramatic. They are absolutely profound in their medium-term implications. Even in the short term, recovery in the job market could be completely subverted by them, and these changes are accelerating in the here and now.
The changes I have in mind are driven by two convergent sources of technological transformation: computer technology and robotics. It has aptly been said that we are entering a second machine age, one that it is totally different from anything we have seen before. One of the most important features of this technological innovation is that in some areas these innovations—and it is amazing when you look at the details—are exponential, not linear, and they are resonant with implications for the future.
The two fields—computer technology and robotics—are tied together by digitalisation. As digital areas, they are truly global, not national in any sense. Only some 15 years ago, it was confidently said by experts in the field that there was a range of tasks that computers could never do, essentially because computers cannot be creative. These tasks included driving a car and translating a natural language. With the advent of supercomputers, all this has changed. Most noble Lords will know that the Google driverless car has gone for something like 400,000 miles without accidents. The only two accidents it had were when two human drivers crashed into the back of it. Supercomputers can now do translations of natural language sources, including, for example, translations of poetry, as well as human translators. That is quite an extraordinary transformation.
The same thing is happening in the area of robotics. About 15 years ago I went to the Sony media lab in Japan and talked to the head of Sony at that time. He said, “From now on, we are concentrating on robotics; this is going to be our main emphasis”. I saw some of the robots they had there. They could barely walk. They could not climb stairs. They could not do the most mundane tasks. This was 15 years ago. How things have changed. I will give you a couple of examples which sound trivial but are actually a bit awesome to me. A robot recently took on the world table tennis champion at table tennis. The robot was winning for most of the match. The human suddenly came from behind at the end, and in fact triumphed, but it will not be long before the conjunction of the computer and the robot will beat all human table tennis players. If you see someone playing table tennis at the top level, it is a completely amazing phenomenon. To think that a machine could be on the verge of beating the world champion is quite awesome.
There is also a robot stand-up comic. It is able to innovate, to tell stories, to tell jokes which the robot itself invents and, as it were, to play the audience just like a human stand-up comic. For example, the robot stand-up comic said, “I went out with an Apple gadget. It didn’t work out—she was always i-this and i-that”. The robot stand-up comic also has a way of deflating the situation when it does not get a laugh: it will say, “Oh well, I’ll have to do better next time”, or, “Hmm, that was not good enough”. It sounds trivial, but there is something awesome going on here.
The implications for work and jobs are huge. Many of my economist friends and colleagues are working intensely on them. Supercomputers will be able to take over a large number of professional and technical jobs. Jobs which only a few years ago it would have been inconceivable for machines to do are now lined up for destruction. They include jobs in the law, the medical profession, accountancy, finance and other areas. These are not low-level jobs, but at least medium-level jobs. We are talking not about the distant future, but of the next 10 years. Some of these changes have already happened. For example, machine translation is already replacing human translators in some of these areas; that is quite widespread.
One detailed analysis carried out by economists in the United States concludes that 40% of technical and professional jobs are vulnerable to takeover by intelligent machines. This is a level of job displacement not seen since the transformation of agriculture by industry. Agriculture used to employ 40% to 50% of the population, and it is now down to 2% or 3%. It is potentially a level of job displacement of that order. That is why it is hard to get one’s head around it. It is easy to dismiss and say that it is just hype about a distant future. It is not that at all, I assure noble Lords. These things are already happening. It is most advanced in the American economy, but it is happening in many other economies, too. So what we see when we go into a supermarket and we are more or less obliged to checkout by machine, or we go into a bookstore and find the same thing—or we go into other shops where there is a checkout machine—is at the lowest level of what will increasingly happen, and is happening, at a higher level. That is serious stuff for future employment.
Could the Minister reflect on or give me a response to three questions? On my first question, an easy or ignorant response would be to say, “Oh well, new jobs have always been created in the past when you have technological change”. We absolutely cannot say this with any certainty here, because we have never been in a position where machines have outstripped us intellectually and physically in this way. What work is going on inside the Government on that issue? This is quite different from the rosy picture and the debate about the immediacy of jobs; it is a surging trend that could be massively important for how we look at the future of employment.
Secondly, if it proves true that there is not enough work to go around in 10 to 15 years, we might have to be much more imaginative about the role of work in life than we are today. Many of my economist colleagues are thinking about this; an example in your Lordships’ House is the noble Lord, Lord Skidelsky, in his recent book. They suggest that we should return to themes that existed primarily in the 1960s of basic income and negative income tax. Is any thinking going on inside the Government about those issues, should those trends become exponential, as to me they will?
Thirdly, and finally, these trends are going along with a phenomenon that my noble friend Lady Donaghy mentioned—the large-scale displacement of wealth and large-scale inequality. It is driven in some part by these technological changes, as has been demonstrated in the United States, where there has been an absolute decrease in the amount of wealth taken by the majority of wealth-holders; almost all of it has gone to the top. A similar pattern is seen with income: the closer that you get to the very top, the greater the proportion taken. That is a really disturbing trend, and it is pretty similar here. We need some seriously new policies to produce a more equitable society in this world of high technological change. I conclude by asking the Minister: where are these policies?
Lord Bilimoria (CB)
My Lords, when the United States was formed in 1776, it took 19 people on a farm to produce enough food for 20 people, so most people had to spend their time and effort in growing food. Today, it is down to 1% or 2% to produce the food. So let us consider the vast amount of supposed unemployment produced by that. There was not really any unemployment produced; what happened was that people who had formerly been tied up working in agriculture were freed up by technological developments and improvements to do something else, which enabled us to have a better standard of living and a more extensive range of products. That is freedom—arguing against the race to the bottom. The noble Lord, Lord Giddens, talked about robots, but I have gone back to 1776. Nothing has changed in that sense.
I thank the noble Lord, Lord Freud, for initiating this debate. I have just a few points to make. First, the rise in the overall employment rate is real and is at record levels and, correspondingly, there has been a fall in unemployment. With the economic dominance of the south-east, there is a need to rebalance the economy by supporting manufacturing, particularly in the regions. Continued tax reform is also needed. The Office of Tax Simplification is an oxymoron; our tax system is getting more and more complicated.
UK unemployment has fallen by 63,000 to 2.33 million. The unemployment rate now stands at 7.2% of the population. As the noble Lord, Lord Holmes of Richmond, said in his excellent speech, employment has risen to a record of more than 30 million. The bad news is that the NEETs are still close to the 1 million mark; although the figure is falling, it is still above 900,000. The number of people claiming jobseeker’s allowance has fallen to 1.175 million. Over the year that number has dropped by 363,200, which is terrific. That is all really good news.
The new Governor of the Bank of England, Mark Carney—I say new, but he has been in post for almost a year—made a fundamental mistake in saying that he was going to give us forward guidance and that when unemployment fell to 7% the Bank would think of raising interest rates. That figure has been reached more quickly than thought, and he has had to back-track on the forward guidance almost straightaway. Interest rates are still at a record low of 0.5%. Just think: what got us into this financial crisis was what was then perceived as being the longest period of low interest rates for a long time—and they were then at 5%. Interest rates are 10 times lower than that, but still we cannot increase them, although the unemployment figures are near, or at, what the Governor of the Bank of England wanted them to be. They have been kept unchanged at 0.5%.
The real issue is public expenditure. Public expenditure used to be around the 40% mark. It was 42% of GDP in the early 1970s. Then under the previous Government it went up to almost 50% of GDP. By the late 1980s it was below 40%. We need to get that public expenditure down to 40%, because our tax-collecting ability historically has been around 38% to 39%. If we can get our public expenditure down to 40% we will have a balanced economy and will eliminate the deficit.
UK manufacturing is not dead, by any means. We are excelling in manufacturing. Our aerospace industry is the second largest in the world. Our automotive industry, of which I speak regularly, is flying. When Tata Motors bought Jaguar Land Rover in 2008, I spent a whole day at the Land Rover factory. Wow—it was impressive. I am due another visit, because my last one is already outdated. The company is now making more in profits than it paid for a business that nobody was interested in buying in 2008: that is how well it is doing. It is also exporting and creating employment.
We have heard the great news that Bentley is moving its 12-cylinder engine manufacturing from Volkswagen in Germany to Crewe in the UK. How wonderful is that? Rolls-Royce is manufacturing at Goodwood. Therefore, we have the best of the best quality—the best cars in the world—being manufactured here in Britain.
Our chemical industry is huge; our defence industry is huge; our electronics industry is huge; and so is our food and drink industry. I speak from my own experience. I mentioned yesterday that we were manufacturing a great deal in Europe. In fact, the majority of our production was in Europe some years ago and we decided to reshore to the UK because here we can produce world-class beer. We now produce in Burton upon Trent; we are winning award after award and exporting around the world. I am proud of that.
We have a plastics industry and a steel industry; we also have a textile industry, which we thought was dead but which is not dead at all. There are still almost 80,000 businesses employing 340,000 people and generating £11.5 billion of turnover.
What about the regions and the whole focus on London? We have a country where one big city is the capital and the financial capital and is much bigger than the second biggest city, Birmingham—let alone Manchester or anywhere else. If we look at a large country such as the United States, New York is big but you have Los Angeles, Chicago and lots of other big cities. If we look at another large country, India, there is Mumbai but also Chennai, Bangalore, Hyderabad, Calcutta and Delhi, which are huge cities in their own right. We have this one big city. I am very proud of London; it is the greatest of the world’s great cities. But how can we encourage business and employment in the regions? The answer is simple: we must encourage manufacturing. We cannot manufacture in London; we have to manufacture in the regions. That can create the jobs.
The Financial Times analysis tells a story in which the percentage of people on jobseeker’s allowance benefits dropped by more than 30% last year in places as varied as Oldham in the north, Stafford in the Midlands and the Suffolk coastal region. This is great news. If we can carry on in that vein, we will have growth and employment outside London.
Again, worries about lopsided economic growth are not new. The noble Lord, Lord Giddens, talked about developments 50 years ago, at a time when the economy was also recovering after a period of stagnation. The then Labour leader, Harold Wilson, complained in Parliament of a two-nations economy and said that,
“the Chancellor has to try to restrain the overheating which he sees in the South at a time when large areas in the North are still in the chill grip of his predecessor’s freeze”.—[Official Report, Commons, 14/4/1964; col. 285.]
Those were the comments of Harold Wilson on Reginald Maudling’s 1964 Budget speech.
We should look at the great signs of success. We have already heard that Hitachi is to move its rail business headquarters from Japan to the UK, and that Bentley is to move from Germany to the UK. Companies from Japan and Germany, the pinnacles of high-tech manufacturing, are moving to the UK. This is fantastic. Hitachi says its move will expand the number of rail jobs to 4,000, which is excellent. I have already mentioned Jaguar Land Rover and Bentley. The Chancellor has promised to cut the costs of manufacturing to boost growth, and he has done it. He predicts that energy costs will go down by £7 billion. Again, that is excellent.
Immigration is one area where I fundamentally disagree with the Government. Their immigration policy has sent out the wrong signals around the world to foreign students and academics. That affects not just universities such as Oxford and Cambridge, where 30% of the academics are foreign. For example, more than 30% of the academics at Birmingham University are foreign. As I say, bad signals have been sent out, and the number of Indian foreign students is now plummeting, but we should look at the contribution Indians make to our economy. On Friday, I went to the celebrations for the principal of West Nottinghamshire College, who has been made a dame. She is the first Indian-born dame in 83 years. She came to this country as a young bride unable to speak English but today heads the most successful further education college in the UK, and probably one of the most successful in the world. That is the power of immigration.
The statistics show that Indians make a huge contribution to our economy. In 2013, Indian men topped the ethnicity employment table in the UK and Indian women came second. Indian men had the second lowest rate of unemployment—and so it goes on. One in seven companies is founded by a migrant entrepreneur. Migrants make a huge contribution to our economy and create jobs. Migrant entrepreneurs have been a benefit to this country.
In looking at overall business performance, we must not neglect SMEs. The Minister talked about all the Government’s initiatives. I was on the National Employment Panel for eight years and on the New Deal task force before that. SMEs account for 59% of private sector employment and 48% of private sector turnover. Within SMEs, small businesses account for 79% of employment and 69% of turnover. We need to encourage these small businesses to grow, because the argument about big companies not paying corporation tax misses the point. Yes, we would like them to pay more corporation tax, but that tax makes up only 8% of our tax take. Most of our tax take comes from the tax that is generated by employment—more than 50% comes from PAYE and NI-paying employees and NI-paying employers. The more jobs we create, the more tax we will generate; therefore we should encourage SMEs to grow.
I have suggested to the noble Lord, Lord Young, that we should have a competition in this country to sponsor staff from 100 companies to attend the Cranfield School of Management business growth programme or the University of Cambridge Postgraduate Diploma in Entrepreneurship. It costs £10,000 to attend these programmes. The businesses that send people to attend those programmes will grow faster than other businesses because we will be training our entrepreneurs to perform better and grow their businesses.
We need to go further on national insurance breaks. Ralf Speth, the chief executive of Jaguar Land Rover, said that the secret of his company’s success was innovation. UK Trade and Investment was mentioned by the noble Lord, Lord Shipley. Exports are crucial. The further we go down the route that I am suggesting of training our entrepreneurs, encouraging manufacturing in the regions and generating jobs, the more exports will follow. I have mentioned my own experience as an example of that.
To conclude, what is the purpose of business? I think that, yes, you want to create a product that people love, but you also want to create employment for the well-being of the people whom you employ. In every survey that asks people what is most important to them, they say family. What else is important to them? They say health. What else is important to them? They say their working life. If people do not work, they are not going to be happy. A happy country is a country with, ideally, full employment. We will never get to full employment, but at least let us try.
Lord Monks (Lab)
My Lords, I add my thanks to the Minister for initiating this debate. He has every reason to be cheerful given the rise in employment that has taken place. It would be churlish not to welcome the fact that the British economy is in a better place than it has been over the past six years, and the rising employment rate is the best feature of that.
As the Chancellor recognised, there is a long way to go before we can say that we have a balanced and sustainable economy. I note that he was not quite as upbeat and positive as the noble Lord, Lord Bilimoria, about the prospects for the British economy. While I welcome the national fall in unemployment, it is not being felt in all areas of the country or all areas of the economy. In the north-west, my region of origin, the number of unemployed has risen by 22,000. That is the largest rise of all the regions in the country. As the Minister said, the figure that raises the greatest concern is the rate of long-term youth unemployment. For example, in south Warrington in the north-west, between May 2010 and January of this year, the number of unemployed young people increased sixfold. In Rossendale over the same period, seven times as many young people have been unable to find work. Further north, in Lancaster and Fleetwood, the number of unemployed young people has increased tenfold over that period.
The harsh facts are that fiscal austerity has slowed and weakened the recovery rather than led to it. Exactly the same thing has happened in the eurozone. Both of these are in contrast to the United States, which has bounced back more rapidly and powerfully than this side of the Atlantic.
Monetary looseness and quantitative easing has been a factor in the UK. It has helped the recovery, but it has also helped it to be rather unbalanced and, for that reason, fragile. One could say that the economy is still on life support while we have quantitative easing. We have been under the delusion, as the noble Lord, Lord Skidelsky, described it, that the policies which made the recession worse would be the same policies that made recovery possible. In fact, public investment is still down 35% from pre-crash levels. Resources still stand idle and must be mobilised in all parts of the country, not just in the relatively prosperous south-eastern corner.
That brings me to concern about the British economic model. Just over six months ago, it was said in the Economist that:
“The bones of Britain’s economy are rotten. Shoppers are consuming not because they earn more but because they can borrow more … Firms with cash … are hoarding rather than investing. New firms … find it hard to borrow: the banks will lend only against property. Britain still buys far more abroad than it sells, despite a weak currency”.
Things have moved on since then. They would not write the same thing today. However, I ask noble Lords to appreciate the fact that some of that is still very true.
The Chancellor recognises these structural weaknesses. He mentioned them in his speech on Tuesday. However, his prescriptions still fall well short of what is necessary to cure our problems. It would be so depressing to think that we are condemned to a future in which we might get a debt-fuelled property boom, particularly led again by the south-east, followed by another financial crisis, followed by another period of austerity. What can we do to avoid that? There are things being done in the banking system but it is important that this rebalancing of the British economy becomes a national priority.
Can we be bolder in this area? The noble Lord, Lord Heseltine, has certainly had a go and is very active in this field. With his report, No Stone Unturned, he pointed to lessons from our neighbouring countries on the eastern shores of the North Sea, including Germany, the Netherlands and the Nordic countries—lessons about decentralisation, skills and active public intervention to spur growth. These lessons need to be learnt here, along with other features of the more successful economies of our North Sea neighbours. These include: the equality of Scandinavia; the collaborative, long-term culture of Germany, with its voice for workers; the widespread, effective collective bargaining systems in all the countries that I mentioned on the other side of that sea; and the general excellence of their infrastructure, public services and welfare states. They did not follow the cult of deregulated labour markets being the route forward to prosperity, and they did not adopt the easy hire-and-fire policies that were largely pursued in the English-speaking world. Even in Germany, the Hartz reforms introduced by Gerhard Schroeder were, by our standards, rather modest and marginal.
Collective bargaining is a term that you do not often hear in this House and sounds quite quaint and historical to many here, although it is prevalent in most of our top companies, including those on the list that the noble Lord, Lord Bilimoria, mentioned as exemplars. It is still strong at a sectoral level in the countries I mentioned and has a major influence in pressing against inequality. After all, if you are the boss and you have influential unions, it becomes far harder for you and your colleagues to sustain a culture in which you tend to help yourself and give yourself the benefit of every doubt when it comes to sharing out the company’s income. If you have effective information and consultation arrangements, involving company councils and even workers on the board, then you strengthen the forces that seek a long-term perspective on company performance—not those who see companies as a bundle of assets to be traded in the City, where the hunger for deals and transaction commissions seems undiminished. That certainly runs counter to our need for a better-balanced, more sustainable economy. The approach of those North Sea economies has much assisted greater equality and better productivity as well as longer-term perspectives about the future of their economies.
I accept that there are many good things about labour market flexibility. When applied functionally it enables workers to respond flexibly, and we have seen some of that in companies through this recession, which has helped to keep employment levels up. Flexibility in skills is obviously important, too, and enables individuals and companies to flourish. In passing, I hope that the Government continue to support Unionlearn, the programme that has done a lot to promote a learning culture among the workforce in this country. It would be a false economy to cut it back. That is not the responsibility of the Minister’s department but is on the Government’s agenda.
Flexible working hours are clearly important for the future to employers and employees alike, but while labour market flexibility has good features it also has some much less good features, particularly where it benefits unscrupulous employers by letting them fire people without adequate consultation. It is a process that has been encouraged in recent months and years by the Government’s moves. It is therefore important to consider labour market flexibility in its different segments, and regulation sometimes produces better practice.
Perhaps the worst thing about labour market flexibility as it has been applied in the UK is the lamentable performance on productivity. Output per hour in Germany is 31% higher and in France it is 32% higher. These are pretty disastrous figures. If we are to keep up with other countries, never mind soar to become the economic leader that the Chancellor talked about on Tuesday, then productivity must become a national campaign. It must become something that we improve and we must all work together to achieve that.
The Chancellor was right to warn against complacency because things are getting better, but I believe that he is wrong not to reach for more ambitious plans—perhaps, for a start, applying some of the lessons that we can learn from the other side of the North Sea.
Baroness Eaton (Con)
My Lords, I add my thanks and congratulations to the Minister on initiating this debate but also on his very inspired work in his field.
I am certain that there is not a single Member of this House who does not recognise the value of employment to the well-being of individuals and their families. Times of unemployment are tragic for people and for the places where they live. Therefore, it is heartening to note that, as we have heard, the number of people in employment is at a record high; over the past year the total has risen and we now have 30.19 million people in work. I know that that has already been referred to but it is such a good figure that I need to say it again.
Even so, many of our major cities, especially those in the north of England, have on occasion suffered disproportionately as major industries have almost disappeared. Therefore, today’s news—again, already referred to—about Hitachi moving its operation to the north-east is very welcome. It is also an indication of the confidence that business has in the UK and its Government.
The closure of one factory can cause several hundred jobs to be lost, even overnight. One authority in the north of England, the metropolitan district of Bradford, where I am a councillor, was once one of the richest cities in Britain and the centre of the world’s wool trade. Over a number of years, the wool trade declined and so did much of the heavy engineering industry. This had a major impact on the employment opportunities for the people of the Bradford district.
In Bradford, for the 12-month period to September 2013, 217,500 residents aged 16 to 24 were in employment. Since September 2011, an additional 18,400 people have found employment. Employment growth in Bradford since 2011 has almost doubled the 4.7% increase seen in the Leeds city region as a whole and is more than four times the 2% increase across the UK.
Bradford’s working population is growing by 2,000 people per year. By 2021, there will be an additional 18,000 work-age people living in the district. Maintaining current levels of employment rates will require 10,000 new jobs. The Leeds city region econometric model forecasts employment growth at around 16,000 by 2020—an increase of 7.5%, which is higher than the increase of 6.5% forecast for the UK. The majority of new jobs will be higher-skilled, with around 6,000 requiring graduate level skills, while only 2,000 will be NVQ level 1 or below. The sectors likely to experience the biggest growth are health, transport, education, retail and professional and business services.
Bradford Council has implemented the rates rebate scheme as part of a package of measures funded by the Government’s successful regional growth fund. This scheme has been critical in persuading a number of prospective commercial tenants to commit to a large retail development project, which has in turn enabled the critical level of pre-letting required to trigger development obligations.
Bradford’s city centre growth zone, launched in 2012, is jointly funded by the regional growth fund and the council, the aim being to encourage private sector investment. Construction of the new retail centre, I am pleased to say, is now under way. The construction phase will create 1,500 jobs, with 2,500 permanent jobs in the completed contract, which is projected to attract 20 million shoppers per annum. The timeframe for the growth zone offer is crucial. The construction phase commenced later than anticipated when the programme was devised, and this creates a major issue. The delivery schedule and the regional growth fund funding period are no longer aligned, resulting in many priority activities falling outside the contracted delivery period.
The city centre growth zone is working in the case of Bradford. It is bringing real change to the face of the city centre—change that is lasting. The momentum for investment has been really positive. It is essential that such excellent government schemes always allow flexibility on timescales to enable local circumstances to be accommodated.
A project called Get Bradford Working has provided funding for unemployed people and has funded longer-term placements in business to provide people with skills and experience. Some 273 unemployed people have been helped into jobs created through the Employment Opportunities fund, and a further 245 unemployed people have been supported into work through the Routes into Work fund. In spite of changes in heavy industry, there are opportunities to train for manufacturing jobs in the district, which still has a larger than average percentage of manufacturing. There is a shortage of engineers—especially those with high-level skills—and there are examples of people working well past retirement age as there are not the people with the relevant skills to replace them.
Nationally, youth unemployment has been rising since the early 2000s, growing by more than a third during the 2008-09 recession, and it has remained too high ever since. It is, however, encouraging news that the latest figures show that youth unemployment has fallen by 29,000 this quarter and is 81,000 lower than a year ago. Some 8.7% of all young people who have left full-time education are unemployed. While this is unacceptably high, we should note that it compares with 12% in 1993 and 14% in 1984.
As we have heard, the Department for Work and Pensions works with young people on jobseeker’s allowance through jobcentres, and the number of young people on JSA has fallen for the 21st month running. The 18 to 24 claimant count peaked in December 2011 at over 480,000, but today it is 295,000.
Apprenticeships can be part of the solution to youth unemployment and aid the development of appropriate skills in manufacturing. There are many opportunities. The Chancellor is to be congratulated on yesterday’s Budget, recognising the value of apprenticeships and extending the apprentice grant for employers scheme, providing £85 million in both 2014-15 and 2015-16 for 100,000 grants to employers, as well as £20 million for postgraduate apprenticeships, as referred to by the noble Lord, Lord Shipley.
As I have said, apprenticeships create many opportunities for young people, but in too many cases young people have not been encouraged in school or by their parents to think of them as a credible alternative to higher education. We need to move young people away from the idea that anything other than a higher education degree is an inferior route to employment.
In many schools, as the noble Lord, Lord Shipley, ably pointed out, careers advice is woefully inadequate, with too little focus on the variety of routes into work and education. Many careers departments in schools do not have a good understanding of the employment trends or the skills required in their locality. Academy schools with business sponsorship do much to improve this situation. Too often, those leaving education are not seen as being ready to cope with the world of work. There can be issues around attitude, timekeeping and communication. Therefore, to some potential employers, school leavers can be much less attractive than those who have experience.
There is no magic bullet that resolves the issues of unemployment overnight. Her Majesty’s Government are to be commended on their economic strategies, which give confidence to investors, on their many schemes, such as enterprise zones and the regional growth fund, and on the support that they gave to businesses in many ways in yesterday’s Budget, which will have a major and positive impact on employment opportunities.
Lord Haskel (Lab)
My Lords, every Wednesday, John Kay writes an article in the Financial Times. Last week he wrote about economics and mathematics, and he came to the conclusion that numbers do not really reflect the world as it really is. Numbers have to be tempered with the realities of human life, as I think the noble Baroness, Lady Eaton, implied. While I welcome this opportunity to debate employment and I welcome the rising numbers in work, I am not sure that there is much to be gained in just debating the level of employment. The noble Lords, Lord Holmes and Lord Bilimoria, told us that the number in work is at a record level; I gently remind them that so is the population. I agree with John Kay. The numbers without the humanity can be meaningless.
I will give another example. In the normal course of events, every month some 30,000 people in Britain change jobs for a whole range of reasons; many of them are for personal reasons totally unrelated to government policies, yet they are all included in government figures. The level of employment has to be considered not just in terms of numbers but also in human terms, in its effect on people and on the fairness of our society. So I will look at the level of employment in this way.
There was a time when the Government were going to create employment by means of an industrial strategy, a strategy that would balance the economy and balance the country; it says so in the coalition agreement. This would mean high-tech growth, skilled jobs, advanced technology and a lower north-south divide. However, as yesterday’s Budget indicates, this has manifestly failed. As my noble friend Lord Monks explained, we have growth, but it is based on increased consumption and on a property boom. It is based more on trading in finance, which is a zero-sum game that benefits the few, and less on trading in goods and services, which benefits us all. Yes, the employment level has gone up, but in a way that reflects this rather disappointing industrial strategy.
The recent report from the Resolution Foundation makes it clear that some 5 million of our workers meet the definition of low pay set by the OECD. We have a higher proportion of low-paid jobs than most OECD countries. Of course, the low pay in many of these jobs is topped up by the Government through the tax system, so giving people a chance to make ends meet but also keeping up the employment figures. Instead of subsidising low pay, why do the Government not do more to encourage people to run their businesses better—by raising productivity so that they can pay a living wage? Yes, the Government are trying to raise skill levels and encourage people to gain qualifications, but if we are seeking to have a successful economy, a degree or a qualification is not necessarily a proxy for or even a means of getting a job. As my noble friend Lord Giddens explained, in that kind of world the economy pays you for what you can do with what you know, not just for knowing it. I would add that, in that kind of economy, success is increasingly a group endeavour that depends a lot on soft skills such as leadership, collaboration, adaptability and the ability to learn and relearn. Indeed, it is the absence of these skills as much as technical skills that concerns many employers today. Perhaps the biggest threat to our level of employment is the possibility of leaving the European Union. This would marginalise us economically because every day we hear from international corporations that our leaving would reduce their activity in Britain and jobs would go elsewhere. Thank goodness we now know that a Labour Government would remove this threat to our level of employment.
Then there is the matter of productivity, raised by my noble friends Lady Donaghy and Lord Monks. Did the Minister see the release on 20 February from the Office for National Statistics which gives the final productivity estimates? In case noble Lords missed it, I will give the highlights. Last year the output per hour in the UK was 21 percentage points below the average for the rest of the major G7 industrialised economies. UK output per hour and output per worker fell compared with the previous year. Our output per hour was 3 percentage points below the level of the pre-recession year of 2007. What this demonstrates is that this Government have maintained the high level of employment thanks to the high number of low-paid, low-skilled jobs that are needed in a low-productivity economy. That is a strong indicator that we are in a race to the bottom. Is this how we are going to pay our way in a globalised economy? Many of the people needed to do all these low-skilled, low-paid, entry-level jobs are the very immigrants that the Government are seeking to control. Is this how we are going to build up our exports to deal with our balance of payments and borrowing, which the Chancellor spoke about yesterday?
The Minister’s fine words about our level of employment does very little to deal with these issues, which are central to our economy. John Kay is right: take the numbers out of the human context and you get a completely different picture. Not only does this kind of employment do little for our economy, it also damages our society. There is more employment, but the unemployed are, more and more, overwhelmingly the younger generation. This is a problem all over Europe and there are EU social funds available to tackle it. Central to this funding is a job guarantee scheme, and the Government were wrong to scrap it. The Minister is wrong. The rising level of employment still leaves many young people needing to be rescued from long-term unemployment before the rot sets in.
Other noble Lords have spoken about the huge growth in zero-hours contracts and part-time work. Yes, this may raise the level of employment, but it also raises the number of people who live with insecurity, people about whom my noble friend Lady Donaghy spoke. My noble friend Lady Hollis, in her letter to the Guardian, pointed out that if you work 30 hours a week on a minimum wage split between, let us say, two 15-hour jobs, you cannot add the hours together to bring you into national insurance, so you end up with no state pension. It is playing on this kind of insecurity that enables employers to make unreasonable demands such as working people harder and paying them less, sometimes insisting on false self-employment, as other noble Lords have spoken about. I put it to the Minister that there is plenty of evidence that this is happening. The economy is growing, corporate finances are in good shape, executive salaries and bonuses are soaring, but ordinary wages are being squeezed. The number of people who are living precariously is on the rise.
We are told that average wages are going up. But the Minister may remember when he was being taught arithmetic at school, that a big increase at the top is enough to lift the average. Meanwhile, the median wage is static, leading to the rising inequality that concerns so many of us. Even with rising levels of so-called employment, is this the kind of leadership that inspires growth and innovation? Is this the kind of leadership that delivers a fair society? Successful leadership means that people have to believe that you believe in what they believe. If they think that all you care about is the numbers, you are in deep trouble. This kind of insecurity and inequality means social and economic trouble.
The level of employment must be in the context of an economy that works for all of us—not just the few who are doing well, but the many who have to make do with low wages and dehumanised working conditions. This level of employment does not create the society that I seek. This is not my vision.
Lord Soley (Lab)
My Lords, I thank the Minister for putting this debate before the House and I share his pleasure at the good news within the employment figures. However, my noble friend Lord Haskel—who, as usual, gives us the benefit of his experience of working in industry and being an employer in the past—is right to point to the dangers of low productivity and low wages. My noble friend Lady Donaghy also made some very forceful points. The Minister might have found her attack slightly critical but if he looks at the figures she produced, I think he will see that they bear further examination.
I say in passing to the noble Lord, Lord Shipley, that yes, the previous Labour Government have to accept responsibility for not regulating the banks and the finance industry much better than they did. However, I would be more respectful of that argument if every other political party, not just in Britain but throughout the western world, had argued for greater accountability of the banks and finance industry. If you strip out the effect of the banking finance collapse you will find that this country's economy has not been in a bad position for a very long time. We need to acknowledge that and get some of the rubbish out of this debate.
I want to focus my comments today on the difficulty that all parties share in addressing the problem of those, particularly young people, but not just young people, who have difficulty in finding a job or maintaining a regular work pattern. My comments follow the direction set not just by my noble friend Lord Haskel but also by the noble Lords, Lord Bilimoria and Lord Giddens, because the science and technology aspect is vital. Changes in science and technology have been a factor in driving the economy forward since the Industrial Revolution but such change is an even bigger factor now.
I do not usually bore the House with my own experiences in life but I should say that my own experiences are one of the reasons why I have always looked sceptically at the unemployment and training issues. I left school at the age of 15 in 1954 and with an appallingly low educational achievement. The first thing that the school’s job officer, as they were then, said to me was, “You look like a nice young man. Why don’t you work in an office?”. So I went to work in the solicitor’s office that he sent me to. The first thing I did was to make the tea and the second was to run messages. That went on for a year.
The great advantage of the 1950s, at that stage, was that there were still plenty of jobs, so after a while I got fed up with my first job and left. You could earn much more on building sites and in factories, and that is what I did. I am not sure that some of those building sites would be open these days after a visit from a health and safety officer. I was quite relieved to discover that one building I worked on in Essex was still standing some years later, although I have to confess that it has been knocked down since. I just hope that that had nothing to do with the young man who was mixing the cement. The reality was that there were plenty of jobs and you could switch around. However, some of the people I knew at that stage did suffer quite long-term unemployment. They were not getting into the job market. Often, it was because of a lack of educational skills.
Just over 100 years ago, in the middle and late 19th century, people became aware of the fact that the abilities to read, to write and to do basic arithmetic were not only good for them but, above all, good for the economy. Those skills enabled them to use the emerging new technologies, and to develop them very effectively. In no way do I want to undermine any attempt to ensure that people leave school with good educational abilities in reading, writing and arithmetic. However, it is a digital economy now, so we need to make sure that everyone who is struggling to get and maintain a job has those skills.
My main question for the Minister is: can we look rather more creatively at how we involve people—not just young people, but particularly young people—in digital training? I do not think that any young person who has had a history of uncertain employment—let us use that phrase rather than “unemployment”—should be allowed to go through the employment agencies without addressing the questions, “What skills do you have and what skills can we give you?”. The same applies to many of the other government departments and the organisations that work with government on this. The same questions should be asked. Do they have the basic skills? “Basic skills” does not mean just being able to use a computer. It does not mean just being able to search the internet. It means an ability to operate in a much more complex area, including the increasingly important one of coding.
I can give a simple recent example. Some youngsters I know who had literally just left school and did not have jobs painted T-shirts and shoes which they had bought and on which they then applied special designs. They sold them at school fetes and charities for anything up to £100. It was pretty impressive. They were certainly able to use computers and they knew how to use the internet but they did not have the digital skills to design a website where they could sell these items. We need to remember that many of the new industries can be run from home; it is much easier to do it now, but not easy unless you have those digital skills. With some basic training, could not those young people have done it? They had computers at home, so they had the technology sitting there, but they could not design websites and therefore promote sales in that way. That is one of the ways forward. I had a conversation the other day with the noble Baroness, Lady Lane-Fox, in which she drew my attention to an organisation called Go ON UK—which I know has been in contact with the Government. It is saying that that is precisely what we need to do. When young people—or older people, because we should not describe this issue only by age—go to a jobcentre or other government agency and their technical skills, such as coding, are assessed, training should be offered immediately to those who do not have the necessary skills.
I would go so far as to say, given the Minister’s involvement in the benefits area, that there ought to be a way that we can offer financial help or recompense—I would almost dare to call it a bribe—for such training. A lot of this is about a lack of confidence, which is particularly true of older people. If you do not have the confidence to use the internet well or to use IT to create, run or work for an existing business, the right training can give you the confidence. As I said, financial support might be needed to encourage that. We need to look much more creatively at this because, for all the reasons that the noble Lord, Lord Giddens, gave, we are looking at an economy which is much more driven by science and technology than ever before. Perhaps I may expand on my example of the late 19th century, when people began to recognise that reading, writing and arithmetic was good, and speculate that if we fast forward a hundred years from now, people will look back and say that we were only just becoming aware in the early 21st century of the importance of digital skills.
There is an opportunity here for Governments and for political parties of all persuasions to look at the way in which new technologies are used to enable people to earn an income wherever they are in life. I want my own party to look into this and it is very encouraging that it is doing so. We have got very much better at this with people with severe disabilities. There is now much greater help in this area. No person should get through an employment agency or some of the other agencies without us gaining some idea of the digital skills which that person has, what more could be offered to them and how they could be encouraged to take up those skills.
Lord Sheikh (Con)
My Lords, I pay tribute to my noble friend Lord Freud for introducing this subject and for his excellent speech. I speak as a businessman and as somebody who has employed many people through several business ventures. At the outset I take the opportunity to commend the Chancellor of the Exchequer on his Budget Statement. I hope to speak more on this subject during the impending debate next week but it is useful to note in this debate the measures that will boost employment.
I welcome measures announced in the Budget to support businesses, which include cutting the cost of energy bills for manufacturing and doubling the annual investment allowance to £500,000. The Chancellor also stated that we will have the most competitive export finance in Europe, by doubling government lending available to exporters to £3 billion and cutting the typical interest rate by a third. All these will provide a much needed financial boost to businesses and free up money to spend on employing more staff, among other things. This was a Budget that backed businesses and, as a result, backed employment.
It is my belief that this Government’s work on welfare and employment is one of their greatest achievements. I have spoken on this subject in your Lordships’ House previously. It has been stated many times in this Chamber, in the other place and elsewhere that the coalition Government inherited a dire financial situation—but we must not forget that this was not the only legacy that their predecessors left behind. This Government also inherited a culture of worklessness, one whereby welfare could and often did pay more than work and where generations did not work. Let us not forget that children and young people who live in households where adults do not engage in any form of employment are not only the most deprived in our society but also the most likely to follow this path once they leave full-time compulsory education. This generational cycle of worklessness was a key factor in the rising levels of welfare dependency and poverty in our communities. Alongside this, there were also vastly high levels of unemployment.
There are now 1.3 million more people in work than when Labour left office. Unemployment now stands at 7.2%, the lowest for the past five years. The number of young people in work has increased by 43,000 in the past three months and the employment rate has now hit a five-year high with a record 30.1 million people in jobs. The OBR has forecast that over the next five years a further 1.5 million jobs will be created, with real earnings growing every year.
It is however important that we remember that employment is not merely a matter of statistics. Every position filled means another family have the security of a regular pay packet. We must not forget that this pay packet is put back into the economy both in taxation and in consumer spending, supporting yet more jobs and growth. Nor should we forget the great benefit to the person’s individual well-being. I am sure noble Lords will agree that work gives people pride and confidence. As an employer, I know that people tend to work for two reasons. The first is to earn a living and the second is to get job satisfaction. On the contrary, being out of work sometimes creates depression and has an adverse effect on people. Work is good for people’s mental health, their physical health and their general well-being—benefits that have been demonstrated repeatedly. Dependency is not liberating. It constrains people and prevents them from achieving their ambitions. What is more, if we can get more people in work, some of them will receive salary progressions and improve their standards of living.
The Government deserve recognition for trying to ensure that we have a fair welfare system to support those in genuine need. Since benefits were capped, 9,200 households have moved into work or reduced their own benefit claim. Some 4,300 of these households have found jobs. We have heard many times that it is the Government's aim to reward those families who want to work hard and get on. Here we are seeing that, as a result, thousands of people are finding jobs and moving off benefits. It was not right that tens of thousands of households received far more in benefits than the ordinary hard-working family earns. We cannot underestimate the resentment and anger felt by hard-working families who saw others who made a conscious effort not to work being rewarded handsomely by the state. This caused tensions within our communities, which is understandable. To have people saying that they “could not afford to work” was absurd. Britain must be one of the few countries in the world where this was the case. Social security should be for people who find themselves out of work and are trying to get back into employment. Few people would disagree with these aims.
I pay tribute to those who offer people the chance of work. The rise in employment is not created by Government alone. It is being fuelled by businesses and entrepreneurs across the country. They should be congratulated. As the economy continues to improve they are feeling increasingly confident about employing more people. I have spoken many times in this Chamber and elsewhere on the importance of supporting small businesses. As has been said many times, SMEs are the lifeblood of the British economy. An ambitious and thriving small business sector is vital for steering the economic recovery in the right direction. None of the early signs of recovery that we are seeing today would have been possible without these small businesses. Their importance comes not only in the money they can make but also in the jobs they create. We must ensure that the systems are in place to aid them in doing this. The National Insurance Contributions Act, given Royal Assent recently, was one such measure. The employment allowance will give businesses and charities a much needed tax cut as a result of the Act. This will benefit over 1 million businesses, with almost 500,000 being taken out of paying national insurance contributions altogether. Businesses will, more often than not, spend these savings on their business—investing it, increasing wages and creating jobs.
Let us also not forget the smallest of businesses, those which currently have no employees at all. The allowance will create a strong incentive for sole traders and new and start-up businesses to hire their first employee. The number of self-employed people has risen. I hope that soon they will have more employees of their own, creating wealth and jobs through innovation.
Another welcome measure is the removal of the jobs tax on young people under the age of 21. As a result of this, employer national insurance contributions will be removed altogether on 1.5 million jobs for young people. Youth unemployment is falling, but it is important that more is done to get young people into work. We can see from the experience of previous generations that the longer the period spent out of work as a youth, the longer the time spent out of work later in life. I am pleased that, thanks to this measure, the future is looking brighter for young people in this country. This will also come as a great benefit to the businesses that employ them. A young, vibrant and skilled workforce is a benefit for us all.
We should also welcome the rise in the number of women in employment. As someone who has spoken many times about female empowerment, it is most welcome that the number of women in employment has reached a record high, with more than 14 million in work for the first time. The number has increased by over 500,000 since the election. Getting into employment should not be something that people are expected to do alone, particularly for those who have never worked before. It can be a daunting process. I am pleased that the Government’s Work Programme is helping people into work. Unlike the short-term focus of previous schemes, the Work Programme is geared towards not just getting people into work, but keeping them there. It is helping large numbers of people escape the misery of long-term unemployment and get back into real jobs. Through this scheme, providers are rightly paid according to results. They have the flexibility to design support systems that address the needs both of the individual and of the local labour market. So far the scheme has helped 208,000 jobseekers find lasting work, including 17,560 young people. This is evidence that there are jobs available, but we must work to ensure that all the measures are in place to get those who need jobs into them.
It is my belief that this Government are committed to lowering unemployment and helping people back into work. However, we must not be complacent. More needs to be done to increase employment and train people to fill the jobs. To enable us to achieve that, we should not rely on my business, which is financial services, but expand our manufacturing activities and undertake more business overseas. We must increase our trade with India, China, Brazil and Africa. There are considerable opportunities in Africa, where I was brought up and with which I still have connections. Given our historic ties with a number of African countries, we must promote more trade with them. Also, we should increase apprenticeships and train more people in different trades and businesses.
Baroness Turner of Camden (Lab)
My Lords, I should like to thank the Minister for introducing a debate on this important subject. He referred to growth, and many of us welcome that, but we have other concerns. What sort of growth, we must ask? What kind of work, and what is the effect upon many families struggling against poverty? The growth is clearly mainly in London and the south-east. The remainder of the country, particularly the north, is not doing so well. Unemployment in the north is around 10%, compared with 5% in the south-east. The parts of the country that are most affected are those that have faced deindustrialisation. The factories that once provided employment for the local population have disappeared. Many industries, like the steel industry following privatisation, have disappeared altogether. This is the process which was started under the Administration of the late Baroness Thatcher.
Concerns about the lack of balance in the economy have been voiced by many noble Lords in the debate. The Government seem to accept that rebalancing is necessary if growth is to continue, but obviously much more needs to be done. It is accepted that we need a more skilled workforce, and in that respect I support the efforts that the Government are making to promote apprenticeship training. Much more needs to be done in that direction for young people. Equally, more should be done to encourage young people into science and engineering studies. A number of years ago, when I was a member of the Equal Opportunities Commission, we ran the WISE campaign, which stood for Women Into Science and Engineering. We had some success in that regard and we could do with another campaign now. We need campaigns to generate more enthusiasm.
As to what work is like nowadays, again, there has been concern about the work that is available. There is talk of zero-hours contract work and of work that is low-paid. Sometimes individuals must take several small jobs because one job simply does not pay enough. This is particularly the case for women, because childcare is too expensive for many people. There was recently a TUC conference for women at which many stories were told of the treatment of people on zero-hours contracts, as well as appalling stories about very low pay. Concerns were expressed that the austerity cuts, from which everyone is expected to suffer, impact more heavily on women. Although there has been growth, wages generally seem to be stagnant. I am glad to say that there has been talk of raising the minimum wage, but it needs to rise by more than the amount suggested for it to be of real assistance. What we really need is the living wage to lift people out of poverty.
In discussions about employment in this House on previous occasions, it was suggested that people should “get on their bikes” and go to where the work exists. That is no longer a good idea because the problem is housing. In London and the south-east generally there is a housing crisis which has resulted in a shortage of social housing, and private renting is desperately expensive. All this indicates that although there is growth, particularly in the south-east, there are still major problems for many people, who face insecurity both in employment and on the housing front. The Government’s employment policies have simply added to that insecurity.
We have seen a series of measures from the Government designed to diminish or totally remove the employment rights that have been fought for over the years. It is now very difficult for a dismissed worker to claim for unfair dismissal. If, after coping with a series of bureaucratic steps he or she eventually gets to a tribunal, it will cost almost £1,000 in fees. Workers injured at work will find it more difficult to claim compensation because of changes to the law, and whistleblowers will now lose their protection if they attempt to warn about unsafe practices in the workplace.
There is also the government scheme of “shares for rights”. Employees are given shares in a company in return for surrendering all employment rights. I am glad to say that these schemes do not appear to have had much success, but all this indicates that the Government prefer to have a workforce with no workplace rights at all. This adds further to feelings of insecurity and of course encourages bad employers to behave even worse. In this House we defeated some of the proposals, but the Government later defeated our amendments in the Commons. I strongly believe that a well paid, well trained and respected workforce is far more likely to produce sustainable growth than an insecure one. After all, no one likes to feel that they are disposable.
As for training, the Government should not pay too much attention to what the media have to say about trade unions. I speak as a former trade union official. Unions are committed to the education and training of members. Unionlearn, the TUC’s education department, is highly respected for the work it does among people who missed out on training earlier in their careers. The automotive industry, which has been doing quite well, has involved the unions and has received their support. I gather that this is what happens in Germany. That was explained in some detail by my noble friend Lord Monks in his speech earlier.
There is some growth and some improvement in the employment figures, but clearly very much remains to be done. Again, I thank the Minister for his speech. It has given a number of us an opportunity to air our problems, and I hope that he will pay attention to what we have said this afternoon.
Baroness Sherlock (Lab)
My Lords, this is another wonderful debate. It is one of those times when it is impossible to be the opposition person responding because if I responded to all the things I wanted to today I would be here twice as long. I was beginning to wonder if it would be a job better suited to one of the robots my noble friend Lord Giddens told us about. If they can do stand-up comedy, I am sure that they can respond to a House of Lords debate rather better than the average human.
I have a growing list in my back pocket of noble Lords who I want to one day have a cup of tea with and pick their brains about things that are nothing to do with the subject under discussion. The noble Lord, Lord Shipley, puts more passion into exports than anyone I have ever heard. I would love to talk to the noble Lord, Lord Bilimoria, about beer one day or the noble Lord, Lord Holmes of Richmond, about the Olympics. He increasingly has a speaking style so engaging that I forget that half the time I disagree with him—sadly I do—but I commend him on keeping us awake while offering up subjects for disagreement.
The temptation at this point is for all of us to take the latest labour market statistics, cherry pick them nicely and then throw them across the Chamber in suitable fashion. Obviously, I will do a bit of that because noble Lords would be disappointed if I did not but I will try not just to do that. I want to try to pull out some of the ongoing problems that we all—I hope—accept and acknowledge across the House, on which, while we may disagree on the reason for them and the prescription, we are able to send a signal to those listening to this debate or reading about it outside that all of us in this House take seriously the challenges facing British workers and are committed to doing something about them.
I welcome the rise in the employment rate. It might be small but it is a positive move and one in the right direction, and I am glad to hear about it. However, I want to look a bit underneath that rise at some of the issues that remain. First, an unemployment rate of 7.2% means that 2.3 million of our citizens are unemployed. I thank my noble friend Lord Haskel for reminding us that behind these numbers are human stories—there are 2.3 million individual crises that we need to take seriously. We all need to guard against ever sounding complacent even as things improve. I am also conscious that the number of people unemployed for more than two years has risen and we need to think quite carefully about the question of long-term unemployment—of which more in a moment.
We also still have a serious youth unemployment problem, as highlighted by my noble friends Lord Monks and Lady Donaghy. Some 912,000 young people are unemployed. That is virtually one in five of all young people. The Minister offered up the caveat that that includes people in further education. At this point I am tempted to quote from the ONS footnotes which explain that, in accordance with international guidelines, people in full-time education are included in the youth unemployment estimates if they have been looking for work in the past four weeks—I will stop myself there not to bore the entire House. The guidelines are quite clear as to who is included. Even if young people in full-time education are excluded, and even though many of them may actually be looking for work, we still have the significant number of 628,000 unemployed 16 to 24 year-olds. It is really serious. The Minister said that we are not where we should be when we come to NEETs. A million young people are not in employment, education and training. That is a tragedy for our country. The number of young people claiming jobseeker’s allowance for more than 12 months has doubled under the Government, so we have a significant issue. Last year, long-term youth unemployment rose to its highest level for 20 years and there are still more than 226,000 young people unemployed for more than a year.
I, like many noble Lords, worry about the regional variation. I do not want just to look crude north and south but if I go down the road from Durham, where I live, to Stockton, the number of young people claiming JSA for more than 12 months has nearly trebled under this Government. However, it is not the worst. If I go down to Yorkshire or Lancashire, in Dewsbury and Burnley, long-term youth unemployment is 10 times what it was in 2010. It is not just a northern problem. In Wiltshire, the north of Swindon has seen long-term youth unemployment increase more than fivefold. There are areas where there is a really significant problem. If we cannot offer hope to young people then what do we have to offer them? It is a tragedy not just for the country, which misses out on all their gifts, but for each of those individuals. As the noble Lord, Lord Sheikh, described, the depression and mental challenges that can come from being out of work are very serious and we must therefore all take it seriously.
In terms of prescription, is the Minister ready yet to accept that it was a mistake by the Government to abolish the highly successful Future Jobs Fund, established by the previous Labour Government, which helped more than 100,000 young people into work? After all, his own department evaluated it positively, showing that it had produced net benefits of £7,750 a head after taking account of tax and benefit changes. What about the Youth Contract that replaced it? That was supposed to generate 160,000 wage incentive payments by the spring of next year. The scheme started in April 2012 and by last month there had been just 10,030 payments. Can the Minister tell the House what plans the Government have for getting the Youth Contract back on track? The mainstream youth Work Programme, which has been referred to by many noble Lords, is also having some fairly serious problems. New figures out show that just one in five people who has been on the Work Programme for two years finds a job. In fact, people are more likely to end up back in Jobcentre Plus than they are to end up in work.
As for the sick and disabled people that the Minister referred to, performance for people on employment and support allowance is pretty terrible. Today’s figures show that job outcomes at the 12-month stage are consistently around one in 20, or 5%. According to the Work Programme invitation to tender, that is what you would expect if there were no programme at all. Do we have a programme that is no better than doing nothing at all? Can the Minister tell us what the Government are doing to address that?
The second issue I want to focus on, raised by many noble Lords, is the state of the labour market and the rising insecurity faced by many of those who are lucky enough to be in work. Too many people are still stuck in temporary jobs or in short or zero-hours contracts that make it harder to get a mortgage or save for a pension. All these add to pressures on our social security system. My noble friend Lord Haskel mentioned the issue raised by my noble friend Lady Hollis about people in more than one job who cannot get into the pension system. When we debated the Pensions Bill last month the noble Lord, Lord Freud, indicated that there was some uncertainty around how prevalent zero-hours contracts were. Under pressure from the shadow Business Secretary, the ONS has now revised its figures and now estimates that there are 583,000 people on zero-hours contracts, up from 183,000 in 2010, which is a more than threefold increase.
I can confirm that the next Labour Government will outlaw the exploitative use of zero-hours contracts by banning employers from insisting that zero-hours workers be available even when there is no guarantee of work, by stopping zero-hours contracts that require workers to work exclusively for one business and by ending the misuse of zero-hours contracts where employees are in practice working regular hours over a sustained period anyway. We will put in place a new code of conduct for their use. Workers are feeling seriously insecure and I am sorry to say—as my noble friend Lady Turner pointed out—that government action has made them in practice less secure by watering down many of the protections workers have enjoyed in health and safety, against unfair dismissal and in other areas.
We then come to the point raised by many noble Lords: the cost of living crisis and the problems of low pay. This year marks the 15th anniversary of the national minimum wage, which I regard as one of Labour’s great policy successes—it boosted pay at the bottom without leading to a loss of jobs and it has wide support. I was talking to a couple of students in Durham recently over coffee, and when I explained about the days before the minimum wage, they were staggered. They had no idea that relatively recently you could just pay somebody whatever you wanted. They were amazed. In 15 years it has now become so commonplace that no one can imagine what happened previously. I know that the Government have changed their position, and I acknowledge that they have accepted it was a mistake to oppose the introduction of the minimum wage, but it is worth remembering that before the minimum wage people were being paid as little as a pound an hour. The Low Pay Unit found a worker in a chip shop in Birmingham being paid 80p an hour and factory workers earning £1.22 an hour. This was really serious. However, unfortunately, low pay has got worse under this Government. Working people have seen the value of their wages fall by an average of £1,600 a year, while the value of the minimum wage has fallen by 5%.
The challenge here, I suggest, is that the Government have not ensured proper enforcement of the minimum wage. Some 5% of jobs pay below the minimum wage, according to the Low Pay Commission, but only two employers in four years have been prosecuted. What are the Government going to do about that? Labour has called for a tenfold increase in penalties for companies that do not pay the minimum wage, and we want to see better enforcement, including giving local authorities new powers in this area. We have launched a review of low pay, led by Alan Buckle, deputy chairman at KPMG International. A Labour Government would encourage employers to pay the living wage through new “Make Work Pay” contracts, under which firms who sign up to be living wage employers in the first year of the next Parliament will benefit from a 12-month tax rebate of up to £1,000 and an average of £445 for every low-paid worker who gets a pay rise. In replying, could the Minister tell the House what the Government’s strategy is for tackling the problem of low pay in Britain? I would also be very interested to hear his response to the questions from my noble friend Lady Donaghy and other noble Lords on the gender pay gap and those from a number of noble Lords, including the noble Lord, Lord Giddens, on inequality.
We also have the problem of underemployment. Record numbers of people now want to work full-time but can get only part-time jobs. According to the latest statistics, 1.5 million people are approaching that position. That kind of insecure, irregular and low-paid work adds to social security bills, so that the Government are now on course to spend £15 billion more on social security and tax credits than they budgeted for in 2010. In particular, the total cost to the Exchequer of those working part-time but who want to be full-time is estimated to be £4.6 billion. While I am on techy numbers, I have another question for the Minister. I am sure that he, like me, has dug into some of the small print in the new labour market statistics. I would be fascinated to know what he thinks about the reasons for a couple of things. It seems that the number of hours worked by both full-time and part-time workers has fallen, but that the hours worked in second jobs have gone up. As far as I can tell, the increase in employment seems to be accounted for by self-employment. Could the Minister tell the House what he thinks that is telling us? Does it raise any alarm bells, either about people having to take second jobs to be able to feed their families or about the kind of drift to self-employment of the unattractive kind described by my noble friend Lady Donaghy in her excellent speech?
It would be reasonable to ask me to talk about what Labour would do instead, so I will finish by doing that. First and foremost, the challenge is to ensure that everyone who can work and should be working is in a job. The centrepiece of Labour’s economic plan is a compulsory job guarantee for young people and the long-term unemployed. Anyone over 25 who has been receiving JSA for two years or more, or anyone under 25 for a year or more, would get a guaranteed job paying at least the minimum wage for 25 hours a week and training for at least 10 hours a week.
As with the Welsh Assembly Government’s Jobs Growth Wales programme, we expect many of the jobs to be in small firms. Experience there has shown that once a company has invested six months in a new recruit, the chances are they will want to keep them on after the subsidy has ended. I was very interested by the speech made by the noble Lord, Lord Bilimoria, and I encourage him in a sprit of bipartisanship, given his own experience of entrepreneurship, to engage with us to think about how we can make this work best for small firms. I was very struck by the need to help young people as well to think about what their entrepreneurial skills could bring to the economy. When I sat on the commission on the riots, I met a number of young people who were in prison for riot-related offences. Many of them were very entrepreneurial indeed—just not in the way that we would want them to be. It was not directed. There is so much talent out there which we could capture and direct. It is important to give people a chance to be out there and to make sure there is a limit to how long they can spend disconnected from the world of work.
The investment in the compulsory jobs guarantee would be fully funded by repeating the tax on bankers’ bonuses—which, I note from the figures, are rising again—and by a restriction on pension tax relief for those on the highest incomes. We also need those young people to be able to move on and progress in the labour market, so Labour would take action to tackle the serious skills gaps that are holding back individuals and, indeed, our economy. A number of noble Lords made some very interesting points, including the noble Lord, Lord Shipley, and my noble friend Lord Soley about the skills challenge and how that is tacked in schools as well as in the economy. At its very simplest, almost one in 10 people on JSA does not have basic English and more than one in 10 do not have basic maths. If you do not have those skills, you are much more likely to make repeat claims for benefits and we need to do something about that.
I say to my noble friend Lord Soley that we do not have a problem just with coding skills but with IT skills as a whole—nearly half of those on JSA do not have even basic e-mail skills. If they are going to make job applications, not just online but to any employer, they need to have basic IT skills, and it is up to us as a country to make sure that we help them to do that. Labour would require jobseekers to take training if they did not meet those basic standards of English, maths and IT—not down the road when they fail to get a job but alongside their job search. I would also be interested to hear the Minister’s response to the broader and very important issues about productivity and skill levels raised by my noble friend Lord Haskel and other noble Lords.
There are some very serious issues here. We have some good progress being made, at least in headline figures, but some very serious problems in long-term unemployment and youth unemployment and in an economy with insecure jobs, poor pay and instability. We need to tackle these. Labour would pledge to get people into work, guaranteeing jobs for the long-term unemployed and the young unemployed. We will tackle the crisis in living standards and the scourge of low pay, address the skills gap and make work pay. We believe it is possible to get Britain working again, with decent jobs that pay enough to feed a family, not just at the top and in the rich areas but right across the country—in Stockton, Dewsbury, Burnley and Swindon. People deserve nothing less.
Lord Freud
My Lords, I have really enjoyed the debate. I thank noble Lords for the energy and effort they have put into some of these complicated issues. I particularly enjoyed the noble Baroness, Lady Sherlock, stealing the “Get Britain Working” slogan that we used in the last election, but that is a compliment. I enjoyed the first two sentences from the noble Baroness, Lady Donaghy, but the next sentence, about where my personal support lay in the Chamber, was incredibly dangerous so I did not like that. The rest of her speech I did not like at all.
To start dealing with the issues, at the core of what the noble Baroness, Lady Donaghy, and the noble Lord, Lord Haskel, said—the real attack on this—is, “Forget the quantity, feel the quality”. However, according to the figures, in the past three years, three-quarters of a million of the extra employment has come from managerial, professional and associate professional occupations. That is 70% of the rise in overall employment. The noble Lord, Lord Shipley, made a point about the importance of having quality jobs that come from the efforts on exports, having the most competitive export finance in the country and reducing the costs of energy. Those are the fundamentals and they create real business and quality jobs.
The noble Lord, Lord Monks, spoke about different parts of the country and the north-west in particular. Clearly, the Budget announcements work in that respect: the business energy package, for instance, helps firms in the north-west, including 27 CHP plants, while the SME package helps 481,000 SMEs in the north-west. The noble Lord, Lord Haskel, cavilled at the numbers going up, pointing out that the population is also going up, but the underlying employment rate is moving up to 72.3%. The most interesting thing is that, if the people in full-time education are taken out of the figures, we are now back in rate terms to the peak point that we reached before the recession. According to the projections of the OBR, we are now moving into new ground, at least on the quantity side.
I tried to go for the fundamentals in my speech and I think noble Lords might find it interesting to read it; it can be hard to take something in when you are listening to it. I was trying to say what was really happening. Productivity is really very interesting and I do not think we understand exactly what has been happening in our labour market in the past five years. We had a crash, the like of which we had not had in a very long time, so there are peculiar things happening. One of the things that was happening with productivity was that, clearly because of the impact on the financial sector, there were some odd moves. There are now forecasts from the OBR that productivity will pick up. Clearly, one of things that will happen as a direct result of that is that wages and take-home pay will start to move in the right direction.
The noble Lord, Lord Giddens, made a lot of interesting points, but one simple one was on income inequality. There is a figure, but the figure is the lowest now—as the Chancellor said—for 28 years. More fascinating were his technological issues and what we need to do about those if they happen. Clearly, as the noble Lord, Lord Bilimoria, said, there have been predictions like this regularly. The noble Lord, Lord Giddens, said that we were now really at a discontinuity, so perhaps it would be different this time. I think that was—in the jargon—such a shocking or disruptive event, however, that it is hard for us to expect the Government to sit down and be able to plan it through. When we see it really start to happen, we will have to work on it. We are getting jobs up, so we have not seen it yet. To respond to him, we have got, in universal credit, something effectively close to a negative income tax. We can actually make the adjustments. On the point made by the noble Lord, Lord Giddens, on the displacement of wealth, the interesting study that came out a few months ago from UBS showed that we were the only major country where the impact of the crash was seen evenly right the way along the income spectrum.
On the gender pay gap, there is a long-term downward trend for full-time employees, falling from 17.4% in 1997 down to 10% and it narrowed in all regions between 1997 and 2013. The noble Lord, Lord Monks, said youth unemployment was too high. On the other hand, it has been falling: the JSA claimant count has now been falling every month for 21 months: it peaked at 480,000 in December 2011 and is now at 295,000, so it is going in the right direction.
Turning to apprenticeships, the point raised was that demand exceeded expectations. That is why the Budget announced funding for more. As for the concerns of the noble Baroness, Lady Donaghy, about their low quality, all first-time apprenticeships will now involve a job and low-quality provision has been ended. My noble friends Lord Shipley and Lord Holmes said that we needed to ensure that youngsters were better equipped with career guidance by schools. Ofsted is also concerned that schools need to meet their duty better and it will give higher priority to guidance in school inspections. The effect of the increase in participation is coming through now and the latest data indicate that the proportion participating is still going up.
The noble Lord, Lord Haskel, simply said that I was wrong on the job guarantee, a point echoed by the noble Baroness, Lady Sherlock. I happen to have a pretty long memory about these schemes from various places. I can, and will, have a go at what is really wrong with that scheme, but I am more concerned about the people who are unemployed. We can help them—we know who they are—but we do not know about the youngsters who just disengage, who are called “inactive”. We all find it very difficult to do anything about that. It is probably where the most serious problem is, because if they are coming into the jobcentre, you have got them and can put them on any scheme you like. If they are not engaging, however, you have a problem.
The guarantee scheme—the one we have got hold of—is fine: it is very like the Future Jobs Fund, which I never liked at the time; instead, we put in work experience. The outcomes of work experience are virtually the same as those of the Future Jobs Fund and the guarantee strategy, but it costs one-20th, and that is how to waste money. Even then, on the sums that I can see, there is not enough money put aside. We cost this policy from Labour at £2.6 billion every year, and very considerably less has been put aside. I am not going to make the joke much about how often the Labour leadership has spent the bank bonus taxes. It spent them on reversing the VAT increase, it spent them on more capital spending, it spent them on reversing child benefit saving and it spent them on reversing tax credit savings. It says that it is not going to do any of that now—it is going to spend them on this. Let us see how long that lasts.
Lord Haskel
We can keep spending the bonuses because the bonuses keep going up.
Lord Freud
Not by that much—not by a factor of 30, or whatever it is.
The noble Baroness, Lady Turner, spoke of her concerns about childcare. We have also been concerned about childcare. Clearly, not only will she have seen the announcement yesterday about the money for taxpayers but she will have also spotted that within universal credit the rate will now be 85%. I know that she and a lot of other noble Lords will welcome that.
My noble friend Lord Soley mentioned skills. I am sorry, he is not my noble friend: I quite like the noble Lord, Lord Soley, but cannot call him a noble friend. On skills, our priority must be to get English and maths training first. One of the things we are doing with universal credit is ratcheting up the requirement for getting people to the basic level of digital involvement. We are doing a lot of work currently to work out how to help people to get to that basic level. The noble Lord is looking at a slightly higher level—into coding. That would be something separate.
Lord Soley
I understand what the Minister is saying. However, many people who are not good at reading, writing and arithmetic actually have quite good keyboard skills, but that does not get picked up. You can see that with kids. My noble friend on the Front Bench leading for the Opposition referred to ex-prisoners. If you look at their digital skills they are actually very good but they are not targeted in a way that enables them to do jobs.
Lord Freud
That is a very good point. I looked a couple of years ago at a scheme that went very specifically for youngsters who had failed in the conventional exams-based syllabus. They were given a chance by various companies to work on computers. Actually, some of them did very well and it was a new recruitment line because they were just tuned that way. There is something very real there that one could probably expand.
My noble friend Lord Shipley—he is indeed my noble friend—raised procurement. That is a matter for the Cabinet Office. I will not predict anything for the next year.
On zero hours, people are more likely to be satisfied than dissatisfied with their hours, mainly because the flexibility suits their current circumstances. While there has been an increase in the estimate, that does not mean there has been a recent increase over that period in the number—as the noble Baroness, Lady Sherlock, would accept. The implication is that, even using the very largest estimate, we are talking about only three in every 100 workers. We are looking currently at making sure that the zero-hours system is appropriate and not abused. That is in hand at BIS.
We accept the point on the enforcement of the minimum wage. Employers who fail to pay can now be publicly named and shamed. That is on top of financial penalties, and civil and criminal proceedings for the most serious offenders. The minimum wage will rise by 3% from October this year to £6.50. That will produce a pay increase for more than 1 million people—the largest cash increase in the minimum wage since 2008.
It is clear, as my noble friend Lord Shipley said, that the Government inherited a very damaged economy, with high levels of unemployment and inactivity. We are now getting back on our feet. The better news on the economy is feeding through to an improving picture in the labour market. As a result, the number of people in work has now exceeded 30 million. We have record numbers of men and women in work and the highest female employment rate on record. As I said earlier, excluding students, we are now at an all-time peak in the employment rate and inactivity is the lowest on record. Given the context of what we have been handling in terms of the recession, that is an extraordinary achievement.
Despite the difficult global economy, over 1.3 million people more now have a job than in 2010—600,000 more than at the peak before the last recession. There are 1.7 million more people working in the private sector. Despite contrary perceptions, the rise in employment—both over the year and since the election—has been dominated by full-time permanent jobs. Things are still looking up. According to the OBR, the economy is expected to grow by 2.7% this year and the number of people in work is expected to increase by 3.3% by 2018. That does not take us quite to the figures I was working with when I wrote my report in 2007, but it does not leave them that far short.
Parliamentary Privilege
(10 years, 9 months ago)
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Lord Brabazon of Tara
That this House takes note of the report of the Joint Committee on Parliamentary Privilege (HL Paper 30).
Lord Brabazon of Tara (Con)
My Lords, privilege carries connotations of social exclusivity or of favouritism, so it is important that occasionally we remind ourselves what parliamentary privilege actually is. We, as members of this legislature, are accountable to the people. We make laws. Our colleagues in the House of Commons approve taxation. We hold the Executive to account. To perform those tasks effectively and without fear, we need certain rights and immunities. We need to be able to regulate our own affairs without interference from government or the courts. Above all, we need to be able to speak and act freely in the course of our parliamentary work without fear of consequences. So the existence of some form of parliamentary privilege is a necessary precondition for a free and democratic society. It is not a special immunity that attaches to us personally. It is the freedom of the House itself, the foundation for everything that we, as parliamentarians, do here.
It is important to restate these principles, however self-evident they are, because at the time the Joint Committee which I chaired was set up they were being widely questioned. In early 2010, four parliamentarians—three MPs and one Member of this House—sought to persuade the courts that parliamentary privilege protected them from being prosecuted for false accounting in respect of parliamentary expenses. That case was still being heard at the time of the 2010 election, and the coalition agreement included a commitment to bring forward proposals to ensure that privilege could not be used by Members of either House to evade justice.
The case brought by the four Members was subsequently dismissed by the courts at every stage, culminating in the judgment of the Supreme Court in R v Chaytor. In that judgment, the Supreme Court reaffirmed something which the two Houses themselves have acknowledged for many years—that a crime is a crime and that Members of Parliament who have committed crimes enjoy no special protection from prosecution. I will quote briefly from the Supreme Court’s judgment:
“for centuries the House of Commons”—
the same applies to this House—
“has not claimed the privilege of exclusive cognizance of conduct which constitutes an ‘ordinary crime’—even when committed by a Member of Parliament within the precincts of the House”.
It follows that a false expenses claim knowingly submitted by a Member of Parliament is fraud, pure and simple—so the main rationale for the Government’s draft Bill had disappeared by the time it was finally published in spring 2012.
What we were left with was, frankly, a bit of a rag-bag. The fundamental question at the heart of the Green Paper, and at the heart of our report, was whether or not we in the UK should seek to codify parliamentary privilege by means of a comprehensive modern statute. That was the central recommendation of the last Joint Committee to consider these issues, chaired by the noble and learned Lord, Lord Nicholls of Birkenhead, in 1999. However, the Government were against codification and so, ultimately, were we.
There are arguments for and against codification. In its favour is the prospect of certainty and clarity. Against it is the inflexibility inherent in statutory codification and the loss of the possibility of evolution. Accordingly, we did not rule out legislation but regarded it as a last resort. If we ever get to a point where the courts or the Executive interfere with privilege to such an extent that freedom of debate in Parliament is compromised, then, and only then, Parliament may have no option but to legislate once again, as it did in 1689 in the Bill of Rights, to put privilege on a clear and unquestionable statutory basis. But we have not reached that crisis point yet, and I hope we never do.
I shall briefly outline some of the Joint Committee’s other conclusions before concluding by addressing the Motion in the name of my noble friend the Leader of the House, which is being debated jointly with this report. We were unanimous in rejecting the Government’s draft clauses which would have vested in the prosecuting authorities the power to waive the protection afforded by Article 9 of the Bill of Rights, thereby allowing parliamentary proceedings to be admitted as evidence in criminal prosecutions. As the Chaytor judgment clearly demonstrated, a crime is a crime, and membership of Parliament is no protection from prosecution. Privilege exists to protect not Members but proceedings themselves from impeachment or questioning in the courts, which is why witnesses before Select Committees enjoy the same protection as Members. Removal of that protection would have a disastrous chilling effect on free parliamentary debate. I am delighted that the Government, in their response to our report, have accepted our conclusion and abandoned their proposal to waive Article 9 in respect of criminal prosecutions.
Secondly, we considered the penal powers of the two Houses and, in particular, their powers to punish those who, either by refusing to give evidence to Select Committees or by giving false evidence, may be guilty of contempt. I do not intend to speak to this complex issue in detail—chapter 3 of our report speaks for itself—but I want to underline that the existence or not of these penal powers has rarely been an issue for Lords committees, which work best when they engage with willing and co-operative witnesses. I know there have been very rare occasions—one involving the Communications Committee comes to mind—when Lords committees have encountered difficulty, but our focus was very much on the Commons, and we will watch developments in that House with interest.
Thirdly, we considered judicial questioning of parliamentary proceedings. In some countries, judicial interference has been the trigger for legislation: in Australia in the 1980s, and currently, although for rather different reasons, in New Zealand. We are fortunate that in the United Kingdom our judges generally show the utmost respect for parliamentary privilege, just as we, in Parliament, show our respect for judicial proceedings by observing the sub judice rule. The noble and learned Lord, Lord Judge, the then Lord Chief Justice, gave particularly valuable evidence to the Joint Committee on this mutual respect. There have been some problems, particularly in judicial review cases, but we concluded that these were exceptions, rather than the rule, and that there was no need for Parliament to take action at this time.
Finally, before turning to the Leader’s Motion, I would like to mention the reporting and repetition of parliamentary proceedings, which is covered in chapter 7 of our report. This is the one area of significant disagreement between the Joint Committee and the Government. The Government say that they are not convinced by our conclusion that the vague wording of the Parliamentary Papers Act 1840,
“significantly inhibits press reporting of … Parliament”.
Instead, the Government believe that such reporting,
“has sufficient qualified protection under the common law”.
I cannot agree. The evidence of media witnesses was clear. Section 3 of the Parliamentary Papers Act 1840, as amended, refers only to extracts or abstracts of documents published or broadcast by authority of the House, terms which do not appear to extend to general media reports. As a result, the media are genuinely confused over the possible risks they may face in reporting parliamentary proceedings. This confusion was exemplified by the chaotic reaction to John Hemming MP’s disclosure in the House of Commons in 2011 that the footballer Ryan Giggs was the subject of an anonymity injunction.
I was therefore pleased to see that the noble Lord, Lord Lester of Herne Hill, had introduced a Private Member’s Bill seeking to give effect to the Joint Committee’s recommendation that qualified privilege should apply to all fair and accurate reports of parliamentary proceedings, a recommendation that we believe would resolve this anomaly. Unfortunately, the noble Lord has been unable to secure a Second Reading for his Bill, and I understand that in the next Session of Parliament he plans to introduce a much narrower Bill, whose scope will be limited to the repeal of Section 13 of the Defamation Act 1996, which allows Members of either House to waive the protection of Article 9 of the Bill of Rights for the purposes of a suit for defamation.
I would certainly welcome the repeal of Section 13, which has created a number of dangerous anomalies, but I regret that the noble Lord is not pursuing the more ambitious proposals contained in his current Bill. As our report indicates, successive Joint Committees —the 1999 Joint Committee on Parliamentary Privilege, the Joint Committees on the Draft Defamation Bill and on Privacy and Injunctions and the committee that I chaired—have concluded that the current blend of statutory and common law protection enjoyed by media reports of parliamentary proceedings is inadequate. I hope the Leader of the House will be able to tell us that the Government have had a change of heart and are ready to bring forward their own Bill in the new Session. In the mean time, I hope the Government will support the repeal of Section 13 of the Defamation Act.
Finally, I turn to the second Motion in today’s debate, which stands in the name of my noble friend the Leader of the House. I would like to put on record my personal thanks to the Leader for his willingness, as Leader of the whole House, to put his name to it. I shall briefly explain the background. Legislation has over the years created innumerable individual rights in areas such as employment, health and safety, data protection, clean air and so on. Businesses, schools, charities and other organisations across the country have to comply with such legislation, and as a point of principle both Houses, as responsible employers, and as custodians of this great palace, should similarly be bound by it. The problem is that, in 1935, in the case of R v Graham-Campbell ex parte Herbert, the courts decided that they were not. The result of the Graham-Campbell judgment, which was never appealed, was a mess. It came to be a common-law presumption that legislation did not apply to Parliament unless it expressly said that it did.
This presumption was reinforced by the fact that some legislation did expressly extend to Parliament. To give a current example, Schedule 1 to the Deregulation Bill, currently in Committee in the House of Commons, contains provisions relating to apprenticeships. New Section A7 in that schedule states expressly that it applies to parliamentary staff. That seems to me to be the right way to go about it, avoiding any doubt or ambiguity. The same approach was adopted in Sections 194 and 195 of the Employment Rights Act 1996, to which the Deregulation Bill refers.
As the noble and learned Lord, Lord Judge, told the Joint Committee, if in one place you say,
“this Act applies to Parliament”,
but in another place you say nothing about it,
“it will be assumed that it does not apply to Parliament”.
That, in a nutshell, is the problem. The Joint Committee therefore concluded that, as a point of principle, all legislation of general effect, covering such areas as health and safety, employment or fire safety, should be extended by means of express provision to Parliament. In fact, as the letter from the Treasury Solicitor printed in the appendix to our report shows, this position has also been government policy since 2002, although not always observed in practice. By adopting this resolution today, we will demonstrate the House’s strong support for this approach and, I hope, contribute to clearer and more consistent legislative drafting in future.
Before I finish, I should like to thank the excellent clerks we had from both Houses who helped us produce what I hope noble Lords will agree is a good report. We also had some very good witnesses. I have already mentioned the noble and learned Lord, Lord Judge, but I should also like to thank in particular the clerks of both Houses of the Australian Parliament, the clerks from the New Zealand and Canadian Parliaments and the former parliamentarian of the United States House of Representatives, not forgetting our own Clerk of the Parliaments and the Clerk of the House of Commons.
In conclusion, I repeat my thanks to the Leader of the House for putting his name to the second Motion, and I hope that the House will agree it without dissent. I very much look forward to the debate. I beg to move.
Baroness Healy of Primrose Hill (Lab)
My Lords, I was honoured to serve on the Joint Committee on Parliamentary Privilege. The report will be a valuable contribution to the ongoing debate. As it says:
“Parliamentary privilege is a living concept, and still serves to protect Parliament, each House, their committees, and all those involved in proceedings. Much has changed since the publication of the report of the 1999 Joint Committee: privilege evolves as Parliament evolves, and as the law evolves”.
Our committee, wisely chaired by the noble Lord, Lord Brabazon of Tara, was fortunate to have a membership, from both Houses, of great parliamentary and constitutional experience and expertise, and I, as a relatively new Member of this House, learnt a lot. We took evidence from a wide range of experts and practitioners in the UK and abroad, and were very ably served by the clerks of both Houses, to whom I am most grateful for their guidance and expertise. I am pleased that the Government have responded so warmly to the report and I welcome the reiteration that they have,
“always been clear that Parliamentary privilege is a matter for Parliament and it is therefore right for Parliament to have a proper opportunity to reflect on its continuing purpose”.
Our committee found that there was no strong case for a comprehensive codification of parliamentary privilege, to which the Government have now agreed, as the noble Lord, Lord Brabazon, explained so comprehensively. But it is important to stress again the committee’s belief that steps may have to be taken both by Parliament and the Government to clarify the application of privilege where appropriate in the future. As the report states:
“This does not mean that we reject all legislation; but legislation should only be used when absolutely necessary, to resolve uncertainty or in the unlikely event of Parliament’s exclusive cognisance being materially diminished by the courts”.
One area I would like to highlight is the reporting of parliamentary proceedings. Our predecessor committee—the 1999 Joint Committee—noted:
“Parliamentary privilege does not cloak parliamentary publications with any form of protection”.
This was decided in 1839 in the case of Stockdale v Hansard, in which the court held that parliamentary privilege did not attach to the publishers of reports ordered to be printed by the House of Commons. The Parliamentary Papers Act 1840, passed in response to this decision, established that no action could be brought in court arising from the publication of the Official Report or other documents ordered to be published by either House. It also provided protection for “any extract or abstract” from such documents made by others, provided that they were published,
“bona fide and without malice”.
Such protection for publications by order of either House is a matter of statute law, not privilege.
As the House will certainly recognise, media reporting has moved on since then. The 1999 Joint Committee defined an “abstract” as a “summary or epitome”, and thus media reports of what goes on in Parliament, even if they draw on documents published by order of the House, such as Hansard, do not generally enjoy the qualified protection afforded by Section 3 of the 1840 Act. This was confirmed by Sarah McColl, solicitor advocate in the BBC, in her oral evidence on behalf of the Media Lawyers Association. But such reports do enjoy privilege in common law in respect of defamation. If the whole debate is published, the protection is absolute; if only extracts are published, the protection is qualified.
The 1999 Joint Committee said that it would be surprising if the common law defence of privilege in respect of defamation was not available also to broadcasters. But our committee found a problem in that, outside the field of defamation, media reports of parliamentary proceedings, as opposed to extracts or abstracts, do not enjoy legal protection. The protections enjoyed under 19th century statute or common law do not meet the current situation, where modern technology means that increasing volumes of data are streamed live via the internet. Such data are subject to instant comment or reporting via social networking sites, and their re-use, for instance by combining them with other data sources, is actively encouraged under the terms of the Open Parliament Licence.
Witnesses called for far wider changes than those proposed by the 1999 Joint Committee to be made to the 1840 Act and to other relevant legislation. The Newspaper Society wished to protect all reports at any time in any form, and the Press Association suggested that absolute privilege should be afforded to all fair and accurate reports of proceedings in Parliament, including media reports of breaches of injunctions.
After careful consideration, our committee did not accept the argument that full freedom of expression in Parliament is dependent on a similar freedom being enjoyed by the media. As our report says:
“The fundamental purpose of affording absolute privilege to proceedings in Parliament is to protect those proceedings themselves, so that the democratically elected representatives of the people can engage in free and fearless debate on issues of public concern”.
On balance, therefore, our committee did not support extending absolute privilege to all reports, including media sketches and summaries, of proceedings in Parliament; not because, as some argued, Members might be used by the media to launder defamatory information—although we could not rule out such a risk—but because the existing protection of qualified privilege, which covers all fair and accurate reports unless they can be proved by the claimant to have been made maliciously, already provides a robust defence of press freedom.
However, our committee recognises that the media need clarity and certainty, and that the 1840 Act does not appear to cover media reports or editorial comment —only “extracts and abstracts” of parliamentary publications, including broadcasts. The wording of the 1840 Act reflects a time when the re-publication by newspapers of large verbatim extracts from Hansard was commonplace; and, although some may regret it, the style of reporting today is very different, to such an extent that the wording of Section 3 of the Act is largely obsolete.
When the Government argued in their Green Paper that they were,
“not aware of circumstances in which any media organisation has been prevented from publishing reports of parliamentary proceedings by doubts over the extent of the current protection in law”,
this was contradicted by BBC and Press Association witnesses. Mike Dodd of PA explained that,
“reporting Hansard verbatim requires a wait of a least two hours before the first draft comes out, whereas we have customers … who have seen something on Parliament TV and want it now or five minutes ago”.
The Government’s draft clause would therefore give no protection to a reporter who, on the basis of a live broadcast, transcribed words said in the House, and then sought to re-publish the words online. The words spoken would not enjoy any protection under the 1840 Act until the online version of Hansard was published some hours later. The committee deemed this indefensible, and therefore endorsed the recommendation of the Joint Committee on Privacy and Injunctions that qualified privilege should attach, in all circumstances, to fair and accurate reports of things said or done in Parliament.
Our committee also endorsed the recommendation of the 1999 Joint Committee that the Parliamentary Papers Act 1840 should be replaced by modern statutory provisions, and that one of these new provisions should confirm that the term “broadcast” includes dissemination of images, text or sounds, or any combination of them by any electronic means. The provisions should also include a delegated power, subject to affirmative procedure, which allows the Secretary of State to update the definition of “broadcast” in the light of further technological change, without the need for primary legislation.
Of special interest to this House is our recommendation,
“that the statutory provisions which we have proposed in respect of the reporting of parliamentary proceedings should also confirm, for the avoidance of doubt, that Members of either House enjoy the same protection as non-Members in repeating or broadcasting extracts or abstracts of proceedings in Parliament”.
I certainly hope that the Government will actively consider wholesale repeal of the 1840 Act and its replacement by modern statutory provisions that clearly establish that qualified privilege applies to all fair and accurate reports of parliamentary proceedings in the same way as it does to abstracts and extracts of those proceedings. The freedom to report parliamentary debates in the media is of vital importance in a democratic society.
Lord Bew (CB)
My Lords, like the noble Baroness, Lady Healy, I very much thank the noble Lord, Lord Brabazon, for the skilful way in which he chaired our Joint Committee. We have in this report shied away somewhat from the concept of comprehensive codification of parliamentary privilege. We thought long and hard about many of these questions, and we were right to do so.
None the less, in the remarks that I make today I will focus on those areas in which we advocate legislative change. In some ways we follow quite closely, as it were, arguments that were advanced in 1999 by the noble and leaned Lord, Lord Nicholls of Birkenhead, in the report of that year. I notice that the noble Lord, Lord Cormack, is in his place. As a Member in the other place, he sat on that committee. There were at least two very important aspects of that report which have seen no action in intervening years; our committee was disturbed by the failure to take action. I refer in particular to the repeal of Section 13 of the Defamation Act 1996.
The problems of and raison d’être of Section 13 arose out of a very particular, unique and, one might almost say, slightly bizarre case of the struggle between Neil Hamilton and the Guardian newspaper at that time, at a particularly difficult moment in parliamentary history and of the Major Government. There is a fundamental problem with the law as it currently stands, which the noble Lord, Lord Brabazon, touched on at the beginning of his remarks. Privilege is not an attribute of an individual Member; it is an attribute of the House itself. The law as it stands is compatible with the view with which I think that both Houses are uncomfortable—that it is in some sense the attribute of the individual Member. There is a strong case for us looking again along the lines of the report by the noble and learned Lord, Lord Nicholls, on this question. There is really no more fundamental misunderstanding in the public mind about parliamentary privilege as that it is a claim by individuals to some form of entitlement. That is not the view of Members of Parliament, but we none the less have the unfortunate legacy of this case. I feel very strongly that this should, if at all possible, be corrected.
There is another respect, too, in which we have followed in a significant degree the report of the noble and learned Lord, Lord Nicholls. Page 94 of the report says:
“The Joint Committee considers the protection given to the media by the 1840 Act and the common law itself should be retained. We consider, further, that the statutory protection would be more transparent and accessible if it were included in a modern statute, whose language … would be easier to understand than the 1840 Act. We recommend that the 1840 Act, as amended, should be replaced with a modern statute”.
Again, that is a recommendation of our committee.
It is clear from the Government’s response that they are not yet convinced that there are significant difficulties facing the media in reporting Parliament. However, on the basis of the evidence that we heard, I find that difficult to comprehend. It is to do partly with the speed at which the media need to respond to things that are said in Parliament. It is clear that in the context of how we have moved in a number of important ways in terms of the recently passed Defamation Act to improve freedom of expression and equality of expression in public debate in this country, it would be ridiculous to leave this as an anomaly.
There is, oddly, a similarity between the 1840 Act and the provisions that arose in the Defamation Act out of the Hamilton case. In both cases, the immediate backdrop in the public debate is bizarre and eccentric. There is something to be said for the 1840 Act; it is important not to throw out the baby with the bathwater—it has given the media certain protection. With any change that occurs, we should be concerned not to throw the baby out with the bathwater. None the less, it is very hard, in both cases, when the circumstances of the legislation are so peculiar, individualistic and bizarre, to argue that there is some case for maintaining in statute language that in both cases is inappropriate—particularly in the case of where privilege resides, where it is fundamentally misleading to the public.
I conclude by taking a slightly different angle of approach to another aspect of our report, while declaring an interest as chair of the Committee on Standards in Public Life. I have to declare that interest because that committee has addressed this area—the appointment of lay members to Select Committees, which is dealt with in chapter 4 of our report. Since 2002, the committee has been pushing for this sort of development of Parliament, with independent or external elements in its system of regulation. In this context, the Committee on Standards in Public Life has welcomed the addition of lay members of the committee as a further independent element of the House system of regulation. In the end, we have decided, after receiving very compelling evidence from the clerks, that there is no case here as such for legislation. However, I do not want it to be thought that the committee, while I think rightly accepting the very cogently argued evidence that we received on this point, did not also pay a great deal of attention and give respect to the letter that the noble Lord, Lord Brabazon, received from the right honourable Kevin Barron MP, the chairman of the Standards and Privileges Committee, who wrote to our chairman to support legislation granting lay members of the CSPL full voting rights, saying:
“I cannot overstate how important it is that lay members should be able to participate on the same basis that MPs do”.
Our proposals are without prejudice to that argument. It is worth drawing the attention of the House to that interesting discussion in chapter 4 of our report.
Lord Norton of Louth (Con)
My Lords, as the first Member to speak who was not on the committee, I welcome the report of the Joint Committee. It is a measured and persuasive report. I also welcome the response of the Government. Privilege is a matter for both Houses, but the Government have an important role to play in facilitating the recommendations of the Joint Committee, not least when legislation is involved. I was very pleased to see the constructive engagement by the Government. There were few issues on which the Government reached a different conclusion to that of the committee. On reporting proceedings, I incline to the view of the Joint Committee, for the reasons that the noble Baroness, Lady Healy, outlined; but on the other issues, for reasons that I shall develop, I agree with the Government.
The report accepts that the current position is not tenable. The assertion of privilege in respect of those summoned to appear before Select Committees has for some time been akin to admiring the emperor’s clothes. In practice, committees rarely have difficulty in securing the witnesses they wish to give evidence. For those summoned, it is often seen as a matter of some pride to appear before a parliamentary committee. It is normally in their interest to appear; they want their views to be heard. The occasions when there is a problem are few and far between, but it is on those occasions when either House may need to assert its powers to ensure that committees can fulfil their essential tasks. As the Joint Committee recognises, it is in the public interest that committees have the power to function effectively. As it records, each House needs to be prepared for when someone summoned tests the penal powers of the House. As it says at paragraph 61:
“It will be too late to consider these matters when a crisis arrives”.
The committee recommends against legislating to confirm Parliament’s penal powers. I think it is correct in arguing that the disadvantages of legislating outweigh the advantages. Legislating would bring privilege within the purview of the courts, not only to determine the scope of privilege, as they do, but also to determine whether a contempt has been committed. It would entail a significant reduction in the exclusive cognisance of Parliament, and give to the courts a role that I suspect they would not necessarily welcome. There is a powerful principled case for maintaining the concept of two constitutional sovereignties, and there would need to be a compelling case to move away from it. I do not believe such a case has been made.
The Joint Committee gets to the nub of what is needed in paragraph 77. It is essentially a test of institutional confidence. This House recently resuscitated its long-standing power to suspend Members. The fact that the power had not been used since the 17th century did not mean that it no longer resided with the House. As the Clerk of the House of Commons told the Joint Committee in respect of privilege, it is not a question of the powers but rather one of their enforcement. However, enforcement must comply with standards of fairness, ensuring that those appearing before committees know what is expected of them and providing a rigorous process, including recourse to legal advisers, should they be subject to a complaint of contempt.
I believe that the committee’s recommendation for a clarification of powers and setting out fair procedures is entirely appropriate. It addresses what is clearly a problem that needs resolving, but also provides the flexibility to meet changing expectations.
The need for flexibility is at the heart of the committee’s report. I wholly accept the argument that flexibility is preferable to a statutory codification of privilege. There is no need for such codification, not least given—as the Joint Committee records—that there is no persistent conflict between Parliament and the courts. The relationship has tended to be characterised more by comity than by conflict. There have been exceptions and on occasion judges have entered into territory that should remain barred to them. Pepper v Hart was designed to enable courts to look at the parliamentary record when there was an ambiguity that could not be resolved other than by examining what the Minister had said. It was not an invitation to pass judgment on what was said and done in either House, but some judges seemed to think that it gave them latitude for such commentary. However, those have been the exceptions, not the rule; and the courts generally have shown no desire to encroach on matters that are deemed to fall within Parliament’s sole jurisdiction. As the Master of the Rolls, Lord Dyson, observed in his recent Bentham Presidential Lecture, talking about judicial review, judges are,
“mindful of the … territory into which they should not enter”,
and in exercising their power, they,
“seek to uphold the decisions of the legislature and to secure the sovereignty of Parliament and the rule of law”.
Where there may be conflict or uncertainty, that is a case for dialogue rather than confrontation. The relationship tends to fit with what Alison Young has characterised as a “democratic dialogue”. As the Government response records in respect of the question as to whether the Register of Members’ Interests should be considered as a parliamentary proceeding:
“This is another case where closer contacts between Parliament and the Courts can mitigate the risks of misunderstandings and improve the consistency of decision making”.
It is important that means of maintaining such contact are developed. One of the many advantages of retaining this House as the highest court of appeal was that it provided a forum in which the Law Lords could appreciate the importance of Parliament and other parliamentarians could appreciate the role of the Law Lords. That relationship was entirely legitimate and indeed, in my view, served to provide some protection for the role of the judiciary against sometimes ill informed criticism by the Executive. Means are now being developed of ensuring that a dialogue can be maintained between the legislature and the judiciary.
Parliamentary privilege needs to be protected in order to enable Parliament to fulfil its functions. The stress is on Parliament rather than parliamentarians. As the noble Lord, Lord Bew, said, parliamentarians enjoy protection only in so far as it is necessary to protect the House of which they are Members. As the report notes, MPs and Peers do not enjoy the immunities accorded to Members of some other parliaments. I think that our approach is appropriate. Privilege should be for the benefit of the nation. It is not designed for the personal benefit of Members.
It is thus entirely right that Members are subject to prosecution for “ordinary crimes”, whether committed on the parliamentary estate or elsewhere.
Following the principle that Members should not enjoy privileges that are not essential to enabling Parliament to fulfil its functions, I agree with the Government that there should be no change to current requirements in respect of jury service. As the response notes, Her Majesty’s Courts and Tribunals Service will readily grant requests to defer jury service where necessary. I certainly see no grounds for arguing that Members should have a right of excusal from jury service in England and Wales, but officers of either House should not. The officers arguably are more essential to the fulfilment of the functions of each House than is any individual Member.
For the same reason, I agree with the Government in respect of the right of Members not to respond to court summonses. As the government response notes, it is a privilege not enjoyed by other public figures. As it says, there is no strong rationale for Members to be treated differently from non-Members in this area. Indeed, I think there is a danger of bringing Parliament into disrepute if a Member hides behind parliamentary privilege in order to avoid responding to a court summons. There is no compelling case that such immunity is necessary for Parliament to fulfil its functions.
On most other issues, the Government agree with the Joint Committee’s recommendations. I welcome the Government’s acceptance that there should be no disapplication of Article 9 of the Bill of Rights in respect of criminal prosecutions and that Section 13 of the Defamation Act 1996 should be repealed. Both are consistent with protecting freedom of speech as essential to enabling Parliament to fulfil its functions and maintaining the clear division between the legislature and the judiciary.
My principal question is directed to my noble friend the Leader of the House, and that is: what next? That question is especially germane in this House. As the report states at paragraph 79:
“If the House of Commons were to adopt our proposals on how its penal jurisdiction should be exercised, we would expect the House of Lords to adopt similar procedures, adapted to the conventions prevailing in that House, in due course”.
“Due course” is a rather imprecise indication of timescale and there is always the danger that, with no set timetable, there may be a tendency to defer any action. It would be helpful to know what steps are being taken to ensure that we do, as the Joint Committee recommends, build on its work, and when we may expect to see the fruits of the deliberations that take place. The report of the Joint Committee is very welcome. It is important that it does not gather dust. It is in the interests of the House that we act on it. Agreeing to the Motion tabled by my noble friend the Leader of the House is a start, but it is essential that we ensure that it is not both a start and an end point.
Lord Brown of Eaton-under-Heywood (CB)
My Lords, like the noble Lord, Lord Norton, I congratulate the Joint Committee on its work and its report and also the noble Lord, Lord Brabazon of Tara, on his crisp and clear introduction of this debate.
This is an admirable report: thoughtful, clear, incisive and readable. Although, as I shall indicate, I do not agree with quite all its recommendations, indisputably it provides a sound platform on which to consider and eventually come to decisions on the way ahead.
I certainly agree, as do the Government, with the committee’s conclusion that there is no strong case for a comprehensive codification of parliamentary privilege. I was one of the court of nine—my noble and learned friend Lord Hope of Craighead was another—in the Supreme Court, which heard the cases of Chaytor and two others late in 2010. We signed up to what I believe can be regarded as the magisterial judgment of my noble and learned friend Lord Phillips of Worth Matravers. I like to think that that decision solved what might otherwise have been seen as a number of doubts and tensions in the relationship between the courts and Parliament.
I agree with all that the noble Lord, Lord Norton, has just said about this, in particular the advantages of the flexibility of the present system and relying on the comity between the institutions involved. I share his regret at the banishment of the Law Lords back in 2009 across Parliament Square.
Of the various other conclusions reached by the committee I will focus on only four, and even then comparatively briefly. The first concerns judicial questioning of proceedings in Parliament. The starting point here is Article 9 of the Bill of Rights of 1689:
“That the freedom of speech and debates or proceedings in Parliament ought not to be impeached or questioned in any court or place out of Parliament”.
The decision of the seven-Member appeal committee of this House in Pepper v Hart in 1993—just over 20 years ago—was a landmark decision which, for the first time, allowed the use of parliamentary material as an aid to statutory construction. However, this relaxation of the rule was made explicitly subject to stringent conditions: first, that the legislation was ambiguous or obscure or could lead to absurdity; secondly, that the material sought to be relied on to explain it was made by the Minister promoting the Bill; and, thirdly, that the statements to be relied on were clear.
Over the past 20 years, there has been a great number of occasions when counsel has explored and cited Hansard in an effort to bolster their contended for construction of legislation, but far fewer occasions on which they have succeeded in that aim. As the noble and learned Lord, Lord Mackay of Clashfern—the then Lord Chancellor—predicted in his lone dissenting speech in Pepper v Hart, the necessary researches in Hansard have in these cases resulted in a substantial increase in the cost of the litigation, and it may be doubted whether this has in truth been justified.
There is also the risk that Ministers promoting legislation may make statements which are specifically designed to assist government in the event of future disputes as to the proper interpretation of the legislation. As the noble and learned Lord, Lord Steyn, suggested in an Oxford lecture some years ago which doubted the wisdom of the decision in Pepper v Hart, courts should be inclined to use the relaxation of the rule—if at all—against government rather than in government’s favour. All that said, I am inclined to agree with the committee’s report, and the Government’s response to it, that at present no further action is needed.
On the linked questions of the disapplication of Article 9 in certain circumstances, and the repeal of Section 13 of the Defamation Act 1996, which qualified Article 9, there is not much that I want to add save that I wholeheartedly agree—as do the Government—with the committee’s recommendations. The proper honouring of Article 9 is essential to free speech in Parliament and, frankly, none of the envisaged exceptions to it begins to make sense. Indeed, Section 13 can itself be seen in hindsight to have been a serious mistake. Ironically, nobody will have seen this more clearly than Mr Neil Hamilton, in whose ostensible favour Section 13 was originally enacted. Your Lordships will recall—indeed, the noble Lord, Lord Bew, recollected this—that Mr Hamilton was originally thwarted in his libel claim against the Guardian newspaper in the cash for questions affair because, the newspaper being at that stage unable to use the parliamentary material as it wished to justify the publication, the judge inevitably had to stop the case. Once Section 13 was enacted, however, Mr Hamilton was able to pursue such a claim, but, of course, in the end it failed dramatically.
I wish to say a brief word on the registration of Members’ interests. I should note that currently I have the honour of chairing the Sub-Committee on Lords’ Conduct, which is a sub-committee of the Privileges and Conduct Committee of this House. In common with many others, I regard the first instance decision in the case of Rost v Edwards in 1990 as a curious aberration, which, if ever it becomes necessary to litigate this point in future, will not survive. Such matters as the register of interests seem to me plainly matters within Parliament’s exclusive cognisance.
I want to say a few words about jury service and witness summonses. It is on these two questions that I find myself in respectful disagreement with the committee’s recommendation, but therefore in agreement with the Government’s rejection of the committee’s proposals. I would not wish to legislate to exempt Members of either House from jury service, from which they are presently not excused, but I would wish to legislate to remove Members’ current right not to respond to witness summonses.
As to Members acting as jurors, the courts may be expected to continue to treat them with great consideration and to grant requests to defer jury service where it would otherwise lead to clashes with Members’ public duties. However, given the widespread sweeping away of exemptions from jury service, which includes that of judges at all levels of the judiciary, Members should not in my view seek to re-establish their own exemption. Indeed, to my mind, it should be quite the contrary. It seems to me enormously valuable that Members of both Houses should experience jury service, and thereby gain a real understanding of what it entails and the strengths and—I may add—weaknesses of the jury system.
As the noble Lord, Lord Blair, pointed out in a Question asked in the House only last week, Section 8 of the Contempt of Court Act 1981 currently prevents almost any research into the workings of the jury system. That section was, it so happens, included in the Act to repair a failure of my own when, as Treasury counsel in, I think, 1980, acting on behalf of the Attorney-General, I unsuccessfully prosecuted the New Statesman for contempt of court for publishing a juryman’s revelations of the jury’s deliberations in the Jeremy Thorpe trial. There was then no law against it. We relied, unsuccessfully, on the common law.
Judges who serve as jurors can now see how it all works in practice—so, too, should parliamentarians. As to witness summonses, again, Members should not be privileged. I agree with the noble Lord, Lord Norton, on this, too. Perhaps this is a matter rather more of perception than of substance. The reality is that, even assuming this privilege is removed, it will be perfectly possible to have witness summonses set aside, assuming they have been issued vexatiously.
On the separate Motion of the noble Lord the Leader of the House, I have nothing to add to what the noble Lord, Lord Brabazon, has already said, save only that I hope that one day some new AP Herbert will arise to find fresh anomalies in our law, and so keep the next generation of students amused.
Lord Davies of Stamford (Lab)
My Lords, it may seem a rather thankless task in life to spend many hours of one’s existence in a committee discussing parliamentary privilege. There are certainly no votes in the subject and there is absolutely zero public or media interest in it. Even though all colleagues in both Houses always say that privilege is enormously important, in practice not many of them are particularly motivated to follow the proceedings of such a committee.
Nevertheless, my participation in the committee was in fact not merely a duty, I suppose, and, no doubt, a privilege, but also a real pleasure. That was due entirely to the motivation and quality of my colleagues on the committee and to the extremely good tempered, fair and, indeed, often humorous fashion in which proceedings were conducted by our chairman, the noble Lord, Lord Brabazon of Tara. I pay tribute to him for what he did over the many weeks when we met.
The results of the committee’s proceedings have been discussed today. I will focus on one or two details. First, I endorse the comments of the noble Lord, Lord Brabazon of Tara, about the need to legislate to remove any ambiguity about the right of people—the media or anyone else—to reproduce parliamentary debates in their accounts of parliamentary proceedings. It is absolutely essential that people—not just newspapers or broadcasting stations—have qualified privilege in citing Parliament as long as they cannot be shown to have acted maliciously or to have perverted the quotation by exclusion or something of that sort. If they have given a fair and true account of what was said in Parliament, they should be immune from any legal proceedings. It is essential in a democracy that people can refer to the proceedings of their elected representatives, or in our case their non-elected representatives, without any inhibition. It is important that we legislate on that.
I find it quite extraordinary, as will every Member of the House and every member of the public, that at a time when the Government are saying that we must have more and more time off because we have nothing to do, they are also saying that there is no time to legislate on important matters such as this. I should be grateful if the Leader of the House would look again at his diary to see whether a Bill could be brought forward in the next Session so that we can deal with this matter as the committee recommended. No one has suggested that that is not a good idea or not an important priority for legislation.
I will deal briefly with a very important matter that was discussed in the committee and has already been referred to today—the issue of witnesses before Select Committees who may be tempted to refuse to appear or to try to deceive the committee when they do appear. That is a very real problem. We spent a long time talking about it. We came to the conclusion, as the House will have seen, that each House should assert its existing competence and sanctions to make it absolutely clear what the rules are and what will happen if someone breaks them. I am happy with that. However, we may find ourselves in a difficult situation if someone cynically decides that there is not much of a downside to refusing a summons or subpoena to testify or is less than straight with the committee when he or she testifies. We may have to come back to this.
There was some discussion in the committee about what we should do if we decided to legislate—whether we should act as the Australians have done and take powers ourselves in Parliament to inflict appropriate sanctions on those people who misbehave in this fashion or whether we should do what the Americans have done and make it a matter of statute law so that it is for the prosecuting authorities to pursue the matter through the courts. The Americans have done that very successfully and, I think, in contrast to the noble Lord, Lord Norton, without any damage to either the perception or the reality of parliamentary sovereignty in the United States. We may need to come back to that.
I was told in the course of proceedings—we had a session in which we took evidence from representatives of the US Congress—that that power has been used in the United States about 20 times in the past century, in some famous cases, such as the Hiss case, as well as in less celebrated cases. That has been enough to maintain the credibility of the system in the United States. No one sane rejects a subpoena to testify to a congressional committee or tells lies before Congress. The legal advice given, if one were to suggest such a thing, would be quite unambiguous in the United States. I am not sure that it would be so unambiguous in this country. We must keep an alert mind here and take the action recommended in our report—that the two Houses independently produce a resolution setting out the powers and sanctions as they currently exist. I hope that that will happen before too long.
Finally, I will comment on a matter on which I found myself in a minority in the committee. My disagreement with the majority of the committee is recorded in the proceedings. Here I also take issue with the noble and learned Lord, Lord Brown, whose views I listened to with great respect. It is the issue of the extent to which proceedings in Parliament can be cited in a court of law, a tribunal, a judicial inquiry or something of that kind. They cannot of course be impeached or questioned: that is quite clear in Article 9 of the Bill of Rights. However, in my view, they should be citable. I put the point to the noble and learned Lord, Lord Brown, who is a very distinguished jurist, that by definition proceedings in Parliament are surely a matter of public record, as they always must be in a democracy. Therefore, what is said and done here is not and should never be a mystery. In certain cases, what is said and done here—such as the passing of a Motion, or the proceedings and recommendations of a parliamentary Select Committee—may be extremely relevant to the subject which a tribunal or judicial review is looking at. It would be artificial if parties to that hearing, or members of that judicial tribunal, were inhibited by law from taking into account something extremely relevant, such as the recommendations of a parliamentary Select Committee on exactly the matter, or part of the matter, that they were reviewing. That would be absurd. It would not be a good day for democracy.
It is sometimes said that it would be unfair if the proceedings in Parliament that might be cited worked against one of the parties or witnesses before a tribunal, committee or other proceeding; that he or she would not be able to argue in his or her defence against the decision of Parliament because that would be in breach of Article 9 of the Bill of Rights. However, that is just a fact of life. If the wording of the statute law happens to be against the interest of one particular party, that party cannot argue about the merits of the law and say that Parliament made a mistake in passing it. It is a fact of life that must be accepted. Equally, if Parliament came to a decision on a particular matter, or a Select Committee came to a particular recommendation, that is a fact which cannot be challenged by a court or tribunal, and neither should it be. It should be taken into account. It is completely wrong that it should be somehow suppressed or that the judicial proceedings concerned should proceed in apparent, and perhaps false, ignorance of the existence of that particular fact. That is the point where I disagreed with some colleagues on the committee and continue to disagree. I am glad that this will be resolved, not by statute or by decision of this House, but by jurisprudence. I hope that, in a responsible and reasonable fashion, the Pepper v Hart tradition is continued and that it is possible for those taking part in proceedings to cite responsibly and in a way that is consistent with the Bill of Rights—not challenging or arguing the substance or that Parliament should not have done X, Y or Z, but simply being able to cite what actually happened in Parliament. It seems to me that, in a democracy, any other behaviour would be bizarre.
Finally, the Government have decided that they were wrong in suggesting the disapplication of the Bill of Rights in criminal proceedings. I and the committee were very glad that they had that conversion. However, there are two long-term lessons that we can draw from this experience and that I hope the Government will take note of. One is that in matters of the constitution, particularly, it is a great mistake to go in for reformulation if you do not intend to change the substance of the rule. If you just rephrase the rule—codify it or put the same rule in what you believe to be better words—you will not have contributed to legal certainty, which should be the duty of any legislator to contribute to. Instead, you will have contributed to uncertainty. That is because the courts will always say, “Parliament has used different words and must therefore have had a slightly different intention and we therefore cannot interpret this principle in exactly the same way as we would have interpreted the previous principle, as expressed and formulated in different words”. You create great judicial uncertainty and, had the Government’s initial Green Paper been implemented, it would have done that and it would have been a great mistake.
The final general lesson that I draw out of all this is that if you are going to legislate, you should never set out a general principle and then create a certain number of non-exhaustive, explicit derogations or exceptions from it. There you again create enormous uncertainty because you have set up a general principle; you have said, “These are exceptions”; you have not said, “These are the only possible exceptions”; and you therefore create a whole area in which there may or may not be exceptions. Again you have created great judicial uncertainty. It is what I called during the committee’s proceedings legislation by negative example. We should never do that in any context and I hope that, the lesson having been learnt on this occasion, it will be taken account of by those who formulate proposals for legislation.
Lord Hope of Craighead (CB)
My Lords, like others who did not have the privilege of serving on the Joint Committee, I congratulate that committee and all its members on an excellent and eminently readable report. I also thank the noble Lord, Lord Brabazon of Tara, for initiating this debate and providing me with the opportunity to contribute to it, which I greatly welcome.
I should like to concentrate simply on the relationship between Parliament and the judiciary. In R v Chaytor, the case to which reference has been made, the late Lord Rodger of Earlsferry said that an invocation of parliamentary privilege is,
“apt to dazzle lawyers and judges outside Parliament”.
I think that his point was sometimes simply that the invocation of the words is regarded as a sort of red light—“Keep off the parliamentary lawn”. However, as Lord Rodger noted, Lord Brougham, when he was Lord Chancellor, cautioned against that approach. His advice was that the courts should not accede to claims of privilege,
“the instant they hear that once magical word pronounced”.
The issue requires to be addressed with more care than that and with a greater regard to the context. Article 9 of the Bill of Rights must, of course, be respected. However, as Lord Brougham said, it cannot have been intended to apply to a matter for which Parliament, especially its individual Members, cannot validly claim the privilege of exclusive cognisance at all. That was indeed what Chaytor was about.
I have to confess that I was surprised to read in paragraph 32 of the Joint Committee’s report the proposition that the courts can only interpret and apply the law, and that making law is for Parliament alone. That, with great respect, is not entirely accurate. There are many areas of the common law that have been developed by the judges with which Parliament has not dealt at all. In those areas, as was explained by the then senior Law Lord, Lord Reid, in 1972, the judges do indeed make law. It is true that they do not have the last word. It is always open to Parliament to reverse the position if it thinks that the judges have got the law wrong, or if the law declared by the judges is not something with which it agrees. However, as the Lord Chief Justice, the noble and learned Lord, Lord Judge, said, ultimately it is Parliament that is sovereign. However, much of the law that is applied day and daily in our courts is law made by the judges. That is one of the great strengths of our legal system. After all, legislation is inevitably a rather blunt instrument. The virtue of our common law is that it can be adapted to fit precisely to the facts of each case.
Leaving that minor criticism aside, however, I welcome the way in which the report deals in chapter 5 with the important issue of judicial questioning of proceedings in Parliament. The Government refer in their response to what they describe as the continuing good relations between the judiciary and Parliament. The relationship is indeed a good one. I agree with the noble Lord, Lord Norton of Louth, that the atmosphere is one of comity rather than conflict. In my experience, both sides are careful to respect the boundaries between what is and what is not permissible. That is certainly so of the judges.
The case of R v Chaytor obviously helped a great deal in clearing the air on this subject, which was causing concern when the idea was promoted of engaging in this report in the first place. I had the advantage of sitting in the court, together with my noble and learned friend Lord Brown of Eaton-under-Heywood. We and, indeed, all members of the court were very conscious of the need to respect the privileges of Parliament, which the appellants—parliamentarians all of them—had invoked. In the event, it was relatively easy for the court to conclude that there was nothing in the allegations against the appellants that related in any way to the legislative or deliberative processes of either House or their Members. As the noble Baroness, Lady Healy, said, a crime is a crime. It was relatively easy to reach that conclusion and the court held that the prosecution in the ordinary courts for the parliamentarians’ crimes of dishonesty was not precluded by Article 9. It is worth noting, as my noble and learned friend Lord Brown said, that nine justices rather than the usual five sat in that case. That was in itself recognition by the court of the importance of the issue that it had to address.
Like my noble and learned friend, I believe that the Joint Committee was right, in a later part of its report at paragraph 229, to criticise the decision in Rost v Edwards. It is worth remembering that that case was decided as long ago as 1990. The judge in that case allowed questions to be put to the Member as to his reasons for not registering an interest in the Register of Members’ Interests. However, I agree with my noble and learned friend Lord Brown that this was simply an aberration. Quite a lot of water has flowed under the bridge since then, and I should have thought that it was now clear and beyond dispute that all questions as to a Member’s reasons for declaring, or failing to declare, an interest for the purpose of proceedings in either House must be a matter within the exclusive cognisance of Parliament.
It is worth noting that in paragraph 23 the Joint Committee says that it would expect the two Houses to intervene should such a case arise in the future. I should add a footnote to that important point. The absence of such an intervention was noted in the Chaytor case. It was also noted much more recently in the HS2 case, on which the UK Supreme Court delivered judgment on 22 January this year. The point was picked up by both the president, the noble and learned Lord, Lord Neuberger, and by Lord Reed. There would be no difficulty in making an intervention should the Houses wish to do so. The rules of the court enable any person with a sufficient interest to intervene in an appeal. The court itself, if so minded, can ask for submissions to be made, and it might take that step itself if it felt that it needed to know what Parliament’s position was if it was in doubt. However, it would be best, as the report suggests, if Parliament itself were to take the initiative.
Chapter 5 dwells on the question of whether reference to proceedings in Parliament for the purpose of judicial review of governmental proceedings could be damaging. The suggestion is that this could lead to a blurring of the constitutional separation between the courts and Parliament because it would seek to question what was said. That point is made in paragraph 132. I agree with a great deal of what the noble Lord, Lord Davies of Stamford, said. I see great force in the objection that he put forward because the risk of the courts going astray on this point is less acute than this part of the report suggests, although I should make it clear that I agree with the conclusion in paragraph 136 that legislation prohibiting the use of such material is not required. I agree with the noble Baroness, Lady Healy, that that should be resorted to only when absolutely necessary; and that situation has not arisen.
Perhaps I may say a little more about the HS2 case, which, because the judgment was delivered this year, was not dealt with at all in the report. Your Lordships may like to know that one of the questions raised in that application for judicial review was whether the Government’s decision to obtain development consent for HS2 by means of the hybrid Bill procedure in Parliament was compatible with the requirements for a strategic environmental assessment under the EU’s SEA directive. The Supreme Court asked itself whether it was appropriate for it to consider that question at all, as it would require an assessment of the effectiveness of the parliamentary procedure. Lord Reed, who delivered the leading judgment on this point, said that he was conscious of the importance of refraining from trespassing upon the province of Parliament, or of even suggesting that he should do so. The president, the noble and learned Lord, Lord Neuberger, too, was careful to say that he recognised the importance of the principle. As it happened, the court was able, in the performance of its ordinary duty of construing the legislation, to hold that it could and should decide the compatibility issue itself. It rejected the invitation that it should evaluate the quality of the consideration that Parliament was likely to give to the relevant issues under the procedure selected by the Government. That was because the directive, properly construed, did not require that particular evaluation to be carried out. I dwell on the point because I suggest that one sees in that very recent decision the system working as it should, as well as the respect due to Parliament and its procedures being properly accorded by the Supreme Court.
It is worth noting just a little more about what was said in the case of Wilson v First County Trust, in addition to the passage from the speech of the noble and learned Lord, Lord Nicholls of Birkenhead, quoted in paragraph 126 of the report. That case was decided in the early days of the development of our jurisprudence on the effect of the Human Rights Act 1998, and what was said in that case has never since been questioned. One of the questions was whether it was proper for a court to be referred to proceedings in Parliament when it had to decide a question of proportionality in relation to the convention rights. I take the liberty of referring to what I said, which was expressly agreed to by Lord Hobhouse of Woodborough. In my own speech, I said that a cautious approach was needed and that particular care must be taken not to stray beyond the search for material that will simply inform the court into the forbidden territory of questioning the proceedings in Parliament. As I put it:
“It is for Parliament alone to decide what reasons, if any, need to be given for the legislation that it enacts. The quality or sufficiency of reasons given by the promoter of the legislation is a matter for Parliament to determine, not the court”.
On the other hand, as I pointed out, proceedings in Parliament are replete with information from a whole variety of sources which are on public record, as the noble Lord, Lord Davies, said. The court would be unduly inhibited if it were to be disabled from obtaining and using this information for the strictly limited purpose of considering whether the legislation was compatible with the convention rights—that being a task which the Human Rights Act itself has given to the judges. The European court in Strasbourg might wish to do that, so our courts should feel able to do so when performing the task entrusted to them by Parliament, observing the boundary set by the case of Wilson.
I agree that questioning the conclusions of a Select Committee—that is, evaluating the quality of its conclusions or suggesting that they were in error—would be wrong. However, that is not what the passages in Wilson were contemplating. I suggest that, carefully read, that decision strikes the balance in the right place. I should add also for the avoidance of any doubt that the fact that the courts do not pay any attention to ministerial statements that the provisions of a Bill that they present to Parliament are compatible with the convention rights does not involve any infringement of parliamentary privilege. These statements in themselves are not questioned by the courts, nor is the extent to which, if at all, they are relied on in either House. They are simply disregarded as irrelevant to the task that the courts have to perform. The fact is that Ministers and the courts are performing entirely different functions, and it would be constitutionally improper for the courts to be told by the Executive what their decision on the compatibility issue should be.
For all those reasons, I welcome the Joint Committee’s conclusion that the problem is not sufficiently acute to require legislation. Of course, it is right that the freedom of speech in Parliament should be protected from judicial questioning, but I think that the risk of that happening is very slight. I think, too, that I can assure the noble Lord the Leader of the House that the justices in the Supreme Court are as anxious as anyone in Parliament that that should not happen. As for the Motion in the name of the Leader of the House, I endorse entirely what the noble Lord, Lord Brabazon, said about it.
Lord Hunt of Kings Heath (Lab)
My Lords, like other noble Lords, I am very grateful to the noble Lord, Lord Brabazon of Tara, for opening the debate and for his chairmanship of the Select Committee. Indeed, as the Select Committee says, parliamentary privilege is one of the special characteristics of our democracy that is crucial but often misunderstood. The Select Committee has gone a very long way towards clearing up many of those misunderstandings and has provided much-needed clarity about the freedoms and protections that each House needs to function effectively. As such, they are an essential bulwark of our democracy—hence the importance of the work of the Select Committee, which I think has been endorsed by every noble Lord who has spoken in this debate.
As the noble Lord said, parliamentary privilege very much came to public attention in the wake of the 2009 expenses scandal, when three former MPs and one Member of your Lordships’ House accused of false accounting over their expenses sought to argue that they ought not to be prosecuted because of parliamentary privilege. As we have heard, the matter was dealt with by the courts in, I suggest, a most sensible way.
I agree that, in the light of that judgment, the Joint Committee’s central conclusion is that,
“the case has not been made for a comprehensive codification of parliamentary privilege”.
I also agree that legislation should be considered only when it is shown to be absolutely necessary. I agree with the Joint Committee’s rejection of the Government’s original proposals in relation to Article 9, and I am glad that the committee has taken such a firm view on that.
My noble friend Lady Healy and the noble Lord, Lord Bew, spoke eloquently of the challenges of media reporting in the current age and of the need for those who are reporting to respond at speed. The noble Lord, Lord Brabazon, referred to the Bill proposed by the noble Lord, Lord Lester, relating to media reporting in Parliament. Given that the noble Lord, Lord Lester, has not been able to make progress in the current Session and given all the problems that we know Private Member’s Bills have in getting through the other place, as the noble Lord, Lord Hill, the Leader of the House, will be responding, I take the opportunity to ask whether the Government will offer time for that Bill to go through the other place.
My noble friend Lord Davies made the very important point that we are being sent away for what one might call obscenely long recess dates at Easter; there are rumours about Whitsun; and we are not coming back from the Summer recess until mid-October. I do not believe that the Government cannot find parliamentary time to enable that to happen. I would welcome some optimism from the Leader of the House either that the Bill of the noble Lord, Lord Lester, if introduced in the other place by an honourable Member, will be given all speed or that the Government themselves will bring forward some legislation.
On Select Committees, I was very grateful to the noble Lord, Lord Norton, for his interesting insight in relation to penal powers and the need for flexibility, which I strongly support. I agree with his conclusion on jury service, although I was struck by one of his comments. I think he said that officers were more valuable than Members to the Houses of Parliament. While we certainly have superb officers, I think that, as Members, we have some role to play.
Lord Norton of Louth
I said they were more valuable than any individual Member.
Lord Hunt of Kings Heath
I was trying to work out the difference between the collective of officers versus the value of individual Members. It reminded me of the “Yes Minister” episode about the National Health Service that concluded that the NHS would run enormously smoothly if patients were not to come through hospitals.
The substantive point on which the noble and learned Lord, Lord Brown, was very persuasive was the question of whether Members should be exempt from jury service. On this matter, the committee report recommends, in paragraph 253, that,
“the Government should bring forward legislation providing that Members of either House should be among those who have a right to be excused from jury service”.
I very much agree with the noble and learned Lord. Many of the previous exemptions have gone and I am sure it is right that all parts of society should expect to be called for jury service, including Members of your Lordships’ House and the other place. On this matter, I hope that we will not move to accept the committee’s report.
With regard to the Motion of the Leader of the House, it seems to be an eminently sensible approach, although I note that in paragraphs 37 to 39 of the committee report, some doubt is placed on the benefit of resolutions passed by both Houses. I ask the Leader: what is the effect of such a resolution? Is it simply a plea to individual departments to make sure, in drafting legislation, that they abide by the resolution, or does it have rather more strength? If the noble Lord could provide some reassurance on that, it would be helpful.
Overall, it seems to me that we are coming to a very satisfactory conclusion. The Select Committee’s report is very welcome. It has been very well written and argued. Apart from one or two areas about which I have doubts, I have no doubt that it has done a great service to your Lordships’ House, to parliamentary privilege and to the way that Parliament works in general.
The Chancellor of the Duchy of Lancaster (Lord Hill of Oareford) (Con)
My Lords, although the subject matter of some of this debate may seem arcane—it certainly involved the application of a number of wet towels to my head to grapple with some of these issues—this afternoon’s debate has reminded all of us how important parliamentary privilege is and that it is a vital part of the underpinning of our whole system of parliamentary democracy. Like the noble Lord, Lord Hunt of Kings Heath, I want to say at the outset how grateful the Government are to the Joint Committee for its report and for its contribution to a debate that has lasted for many years and, I dare say, will continue for many more years, providing entertainment for law students in the future.
The Joint Committee’s report put its finger on all the key issues, came up with a number of helpful recommendations and succeeded in doing something which some noble Lords may think is even more noteworthy: it has got the Government to think again. So I would like to record my thanks to all noble Lords who were members of the committee, in particular to my noble friend Lord Brabazon of Tara for his expert chairmanship and for setting out the issues so clearly today. Indeed, the whole debate has served as a reminder, if one were needed, of the knowledge and experience of the law and of Parliament which is to be found in your Lordships’ House.
In some ways, parliamentary privilege is itself a slightly unfortunate term: as my noble friend Lord Brabazon said, it carries a suggestion of elitism, a hint of exclusivity and risks reinforcing the impression—false, I believe—of politicians who look out only for themselves. But in opening this debate, my noble friend was also absolutely right that the concept of parliamentary privilege helps to protect the rights of everyone in the country. It underpins the sovereignty of the people’s representatives in Parliament, it provides those representatives with an absolute and untrammelled right to say what they believe, and it allows anybody to speak to Parliament without fear of legal consequences.
As we have already heard, these “privileges” do not mean that individual MPs and Peers are above the law, as we all saw in 2010, when a group of parliamentarians tried to assert privilege to avoid prosecution for offences relating to their parliamentary expenses. The Supreme Court’s judgment in that case, R v Chaytor, confirmed that parliamentary privilege did not protect parliamentarians from prosecution for ordinary crimes under our criminal law, and quite right too. That point was set out very clearly by the noble and learned Lord, Lord Hope of Craighead.
Even so, the Government felt that it was right that we should take a fresh look at all aspects of privilege to see whether there was a case for change. As noble Lords know, that led in April 2012 to the publication of the Green Paper which the Joint Committee has so helpfully scrutinised. I am sure that everyone in the House would agree that, wherever possible, matters such as privilege should be approached in a consensual and cross-party way, so I am very pleased that the Government have been able to agree with most of the committee’s findings, most notably its overarching conclusion that a comprehensive codification of parliamentary privilege is not desirable. I listened with particular care to what the noble and learned Lord, Lord Brown of Eaton-under-Heywood, had to say in that regard. My noble friend Lord Norton of Louth stressed the importance of flexibility, which was a theme picked up by a number of noble Lords.
The Government believe that legislation should be brought forward only where really necessary—I think the noble Lord, Lord Hunt of Kings Heath, said that and I may hold him to it in a different context in other areas of political debate. For example, if the Chaytor case had gone the other way we may have considered it, but we agree with the conclusions of the committee that the potential consequences of comprehensive codification are impossible to predict. As the committee itself recognised, that conclusion does not, however, prevent Parliament taking steps to clarify the application of privilege where necessary. I will not try the patience of your Lordships’ House by going through the Government’s response to the report point by point, but I will touch on the most important areas, all of which have been raised by noble Lords this afternoon.
First, the Green Paper included a draft clause which would have enabled the protection of Article 9 of the Bill of Rights to be disapplied in the prosecution of criminal offences. The intention of that clause would have been to ensure that nobody accused of a serious criminal offence could use parliamentary privilege to avoid prosecution where the alleged offence was not related to the key elements of freedom of speech. The committee opposed the provision on the grounds that it would have a damaging effect on freedom of speech in Parliament. In addition to this principled objection, which was underlined by the noble and learned Lord, Lord Brown of Eaton-under-Heywood, it is clear from looking at the draft clause that the Government came up with, and the lengthy schedule setting out those criminal offences which would not be covered by the terms of the clause, that there would also be daunting practical difficulties in implementing such a proposal. The Government will not therefore be taking it forward, and I am grateful for what my noble friend Lord Norton of Louth said in that regard.
The Joint Committee also rejected a draft clause which would explicitly have applied parliamentary privilege to the House of Commons Committee on Standards, which has lay members, which was a matter first raised by the noble Lord, Lord Bew. The Government agree with the committee that such a provision could have cast doubt on the privileged status of other committees, particularly our own Committee for Privileges and Conduct, which also has lay members. It also seems undesirable in principle to attempt to apply parliamentary privilege to a specific Select Committee by legislation.
The Government also share the committee’s serious reservations, which we have heard this afternoon, about Section 13 of the Defamation Act 1996, which allows individuals to waive the protection of parliamentary privilege in defamation cases. This breaches the principle that privilege belongs to the whole House rather than one person. That was a point made very forcefully by the noble Lord, Lord Bew. Accordingly, the Government support the repeal of Section 13. I understand that my noble friend Lord Lester of Herne Hill, who cannot be here today, proposes to introduce a Private Member’s Bill to deal solely with this small but important change. The Government are in principle supportive of this measure to make that clear, and we look forward to seeing if it can make progress.
I should say a few words about the applicability of legislation to Parliament—in other words, the extent to which the activities of Parliament itself are bound by the laws it has passed. Over the years there has been a measure of uncertainty and disagreement on this point and while the Government do not agree with the committee that it is necessary to legislate in this area, we do agree that it is important for parliamentary counsel and the authorities of the two Houses to discuss whether relevant provisions in Bills, case by case, should apply to the activities of the two Houses. That is why the Government’s response agreed to ensure the correct application of the Treasury Solicitor’s 2002 guidance which asked departments,
“to consult the respective House authorities … on whether any proposed legislation that is to apply to the Crown, or its servants, should also apply to the two Houses and to instruct the draftsman accordingly”.
The Government also welcomed the proposal for a Motion which sets out the importance of Bills making express provision where necessary. Following discussions with my noble friend Lord Brabazon of Tara, I tabled the Motion which noble Lords have seen in my name on the Order Paper. I believe, as a number of noble Lords have agreed, that it offers a practical way forward. The key for it to work will be good communication on a case-by-case basis and I can certainly commit the Government to engaging with the parliamentary authorities in a completely constructive spirit on that. Assuming that the Motion is agreed to, my understanding is that the Leader of the House of Commons will move something similar down the other end.
Let me say something about the issue of reporting and repetition of parliamentary proceedings, about which a number of points have been made and to which my noble friend Lord Brabazon drew particular attention. The noble Baroness, Lady Healy of Primrose Hill, also devoted many of her comments to this. As we have heard, the committee concluded that the uncertainty around the Parliamentary Papers Act 1840,
“significantly inhibits press reporting of the work of Parliament”,
and called for its wholesale replacement by modern statutory provisions. As we said in our response, the Government agree with the committee that the 1840 Act lacks clarity and does not fit well with modern modes of communication, a point developed by the noble Baroness, Lady Healy. We also agree that the burden of proof where reporting is alleged to be malicious should be reversed such that it falls on the claimant rather than on the defendant. While we are not as convinced as the committee that the current legal framework significantly inhibits press reporting of Parliament, we understand the need to modernise the law. We will certainly continue to consider whether we can find, and how we can find, an appropriate legislative vehicle to achieve this important aim.
Lord Davies of Stamford
I am most grateful to the Leader of the House for giving way. Would not a suitable vehicle be the reintroduction of a Private Member’s Bill by the noble Lord, Lord Lester, or another private Member, of the kind that has just been referred to?
Lord Hill of Oareford
Obviously that would be a matter for my noble friend Lord Lester. I believe that the focus of the Private Member’s Bill that my noble friend is keen to bring forward is on the repeal of Section 13 of the Defamation Act. I think that that is his priority and that he is keen to have a clear and focused approach on that. But obviously it would be open to other noble Lords to pursue this issue through that route.
The committee also looked at the sessional orders which have traditionally called on the Commissioner of the Metropolitan Police to prevent the obstruction of Members in the streets leading to the two Houses. The Government do not intend to push for the revival of the sessional order in the other place but I thought that I would take the opportunity to put on the record that, so far as this House is concerned, we will continue to support the passing of the sessional order in the House of Lords at the beginning of each Session. I also remind the House that in looking at that issue, the committee referred with approval in the report to the “appropriate and proportionate” legislative provisions governing amplified protests in Parliament Square. What the committee did not say was that the situation was, at that time, much less clear in the areas around your Lordships’ House. Since then, an amendment to the Anti-social Behaviour, Crime and Policing Bill—now an Act—passed in your Lordships’ House has applied the Parliament Square system to this end of the Parliamentary Estate. I very much welcome that because I was keen that it should be done. I am sure also that all members of the Joint Committee will welcome it.
I am grateful for the points raised by my noble friend Lord Norton of Louth and by the noble and learned Lord, Lord Brown of Eaton-under-Heywood, about jury service, and I agree with the noble Lord, Lord Hunt of Kings Heath, that we should not re-establish the exemption that was removed. On the interesting debate about the penal powers of Select Committees, on which both the noble Lord, Lord Davies of Stamford, and my noble friend Lord Norton of Louth concentrated, I think we all agree with the committee’s recommendation that the existing powers should be clarified. That is the right way forward rather than the legislative route. It is for the other place to lead on this, which I think was the recommendation of the committee. My understanding is that it is being taken forward down the other end, but I agree that we need to keep an alert mind on these issues.
Parliamentary privilege is a precious inheritance which we must safeguard, but that does not mean that it should be immune to all change. It needs to reflect the world as it is today, a point that was forcefully made by the noble Baroness, Lady Healy of Primrose Hill. That is why I am so grateful to my noble friend Lord Brabazon and his colleagues in both Houses for their important report. It has enabled us to look at things anew and it upholds the key principles on which parliamentary privilege and parliamentary democracy are built.
Lord Brabazon of Tara
My Lords, I am grateful to my noble friend the Leader of the House for his positive response, and to everyone who has spoken in what I think has been an interesting and informative debate. I hope that this report does not suffer the same fate as the 1999 report, about which I think absolutely nothing has been done. We have at least taken a step in the right direction today because one of our recommendations is being acted upon right now. With that, I commend the report.
Lord Hill of Oareford
That, in the light of the recommendations contained in paragraphs 226 and 227 of the report of the Joint Committee on Parliamentary Privilege (HL Paper 30), this House resolves that legislation creating individual rights which could impinge on the activities of the House should in future contain express provision to this effect.