House of Commons

Monday 14th July 2014 Commons Chamber

Monday 14 July 2014

The House met at half-past Two o’clock

Prayers

Monday 14th July 2014 Commons Chamber

[Mr Speaker in the Chair]

Oral Answers to Questions

Monday 14th July 2014 Commons Chamber

The Secretary of State was asked—

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

1. What progress his Department has made on the Army 2020 programme.

[The Minister for the Armed Forces (Mr Mark Francois)]

The Army continues to implement Army 2020 structures in accordance with the announcement made by the Secretary of State on 5 July 2012. Headquarters Force Troops Command has formed in its new role, and Headquarters 1 UK and 3 UK divisions will commence their new roles this autumn. Units will enter the new annual training cycle from 1 January 2015.

[Diana Johnson]

Will the Minister explain why the only target the Government will meet is to shrink the full- time regular Army to 82,500 by 2018, so that the whole professional British Army will fit inside Wembley stadium? What does that say about the coalition’s priorities in terms of national security?

[Mr Francois]

First, the reserve force is professional too, and the combined regular and reserved force will not fit inside Wembley stadium—although the way England has been playing of late, that may be a mercy. I remind the hon. Lady that the new defence approach does not represent our purely breaking new ground, but brings us more into line with our international partners. Reserves currently make up 17% of our armed forces, compared with 55% in the United States, 51% in Canada, and 36% in Australia. Under Future Force 2020, reserves will make up 20% of our armed forces and 26% of our Army.

[Sir Nicholas Soames (Mid Sussex) (Con)]

Does my right hon. Friend agree that if the Army 2020 model is to succeed it will depend on a proper pull-through of new recruits? Will he confirm that the Capita system, which made such a disastrous start, is now improving and achieving a satisfactory flow of new recruits?

[Mr Francois]

I confirm that there have been problems with the computer system, and I have said that in the House previously. I also confirm that that is being improved, and that additional measures have been taken to streamline the process—for instance, by reducing paperwork and medical bureaucracy. The system is improving and the flow is getting better.

[Nick Smith (Blaenau Gwent) (Lab)]

23. Last month’s National Audit Office report on Army 2020 showed that Ministers had not done the basic work to ensure the successful delivery of the reforms, particularly of reservist recruitment. Poor planning data had been used and assumptions were not tested. Why did the Minister not challenge those half-baked proposals?

[Mr Francois]

When I served in the Territorial Army in the 1980s, I served on something called Exercise Lionheart in 1984. In those days, what was the Territorial Army had 75,000 trained men and women under arms, drawn from a smaller population. I have to believe that if we could achieve 75,000 then, we can get 30,000 trained men and women by 2018-19. We can do this, and I believe that we will.

[Mr Richard Bacon (South Norfolk) (Con)]

The Defence Reform Act 2014 requires the reserve forces and cadets associations to prepare an annual report on the state of the reserves, and the Secretary of State to publish it. Will my right hon. Friend confirm that that report was filed on time? When will he publish it?

[Mr Francois]

Shortly.

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

22. Does the Minister agree with the National Audit Office’s conclusion on Army 2020, which was that the Department did not properly assess the value for money of shrinking the size of the Army?

[Mr Francois]

We believe that we have properly assessed the right size of the Army to create a mixture of regulars and reserves to defend our country in the future, and I respectfully remind the hon. Gentleman that we mobilised 25,000 reservists for service in Iraq and Afghanistan, many of whom won gallantry awards fighting directly alongside their regular counterparts. We are very proud of our reserves and what they have achieved in the defence of this country in the past, as well as what they will continue to do in defence of this country in the future.

[Mr Julian Brazier (Canterbury) (Con)]

Although I strongly welcome my right hon. Friend’s earlier answers, will he tell the House what is being done to get the money and processes of recruiting back into the hands of reserve units?

[Mr Francois]

My hon. Friend—who, by the way, is responsible for the amendment that leads to the report mentioned by my hon. Friend the Member for South Norfolk (Mr Bacon)—is familiar with the whole process, and he and I have discussed the matter on a number of occasions. To make the programme work as effectively as possible, we must continue to devolve responsibility for recruiting down to unit level to give commanding officers and their subordinate officers greater responsibility and challenge in meeting the numbers. As I have intimated to the House, that programme is already under way, and I believe that with his support, and support across the House, we can make this programme work.

[Mr Kevan Jones (North Durham) (Lab)]

The NAO report concluded that the Government’s incompetent handling of Army 2020 was leading to serious shortfalls in capability. As my hon. Friend the Member for Denton and Reddish (Andrew Gwynne) just announced, the only target they were meeting was handing out P45s. The Prime Minister’s announcement today of investment in special forces will ring pretty hollow as they go through a restructuring programme that has seen a reduction in their capability. Is this not yet another example of Ministers giving with one hand, only to take away with the other?

[Mr Francois]

The reason we have been able to announce more than £1 billion of investment in equipment for our armed forces is the careful financial management we have had to undertake because of the financial train crash we inherited from Opposition Members.

[Mr Philip Hollobone (Kettering) (Con)]

2. What policies he is pursuing to prevent political disintegration in Afghanistan similar to that occurring in Iraq after NATO forces leave.

[The Secretary of State for Defence (Mr Philip Hammond)]

There are significant differences between Iraq and Afghanistan. Subject to the conclusion of a status of forces agreement with NATO, the alliance plans to continue to support the Afghan security forces and the Security Ministries as part of the Resolute Support mission. NATO countries reaffirmed the Chicago summit commitments of $4.1 billion a year towards Afghan national security force sustainment, helping to underpin the long-term stability of Afghanistan. We look forward to the status of forces agreement being completed as one of the first acts of the incoming Afghan President.

[Mr Hollobone]

Two things seem to have caught everyone by surprise in Iraq: the very poor intelligence picture that the west has had on the caliphate forces; and the fact that nobody seems to have understood how weak the response of the official Iraqi armed forces was going to be to the Sunni insurgency. Can my right hon. Friend assure me that those two big failures will not be repeated in Afghanistan?

[Mr Hammond]

It is important to note that the failure of the Iraqi security forces was a failure of political coherence, not a failure in combat. Where they engaged in combat, they performed adequately. It was where they failed to engage at all that the problem arose. We expect to have far better situational awareness in Afghanistan, because of the continuing engagement through Operation Resolute Support in that country.

[Derek Twigg (Halton) (Lab)]

The Secretary of State will be aware of recent reports that areas such as Sangin, Now Zad and Musa Qala have fallen into the hands of the Taliban or the insurgents. Are those reports correct?

[Mr Hammond]

I think I said to the hon. Gentleman the other day that there has been combat in that area of northern Helmand and that the Taliban did take some ground from the Afghan national security forces. However, the ANSF rapidly regrouped, and almost without any support from the international security assistance force retook the towns in question. The ANSF are now in effective control of those towns on the ground. The Taliban attack has been defeated. That is not to say that the ANSF are not prepared for a further assault by the Taliban. This area of Helmand is by far the most kinetic in Afghanistan. It is a very dangerous area still, and it will be for the foreseeable future.

[Mike Crockart (Edinburgh West) (LD)]

In the difficult circumstances that the Secretary of State outlines, some of those most in danger are the 600 interpreters who served with the British forces on the front line. In June last year, he outlined plans to allow them to resettle in the UK, so will he tell the House why, according to recent reports, only two of them have so far been granted visas?

[Mr Hammond]

I do not have the statistics on the current state of the programme to hand, but it is working and applications are being processed. I am very happy to write to the hon. Gentleman with the exact current state of affairs.

[Sir Edward Leigh (Gainsborough) (Con)]

3. What discussions he has had with his counterparts in the middle east about the situation in Iraq.

[John Glen (Salisbury) (Con)]

8. What plans he has to consult partner countries in the middle east about a solution to the current violence in Iraq.

[Rehman Chishti (Gillingham and Rainham) (Con)]

16. What discussions he has had with his counterparts in the middle east about the situation in Iraq.

[The Secretary of State for Defence (Mr Philip Hammond)]

I recently travelled to the Gulf for discussions with the Governments of Saudi Arabia, United Arab Emirates, Kuwait and Qatar to better understand the views of our closest allies in the region on the situation in Iraq. There is a shared view that only a political solution, based on a more inclusive Government in Iraq, can turn the tide against ISIS.

[Sir Edward Leigh]

Would this House of Commons not be in a shameful position if, having caused this murderous civil war between Sunni and Shi’a by our wrong-headed invasion of Iraq, we now washed our hands of the situation? Nobody wants to commit ground troops again, but is there not a case to be made for committing advisers and, if necessary, special forces—any means necessary short of ground troops—to show our moral support for the existing Government in Iraq?

[Mr Hammond]

We have made it clear that we believe there are two steps. The first is a political solution to the situation in Iraq. Iraq must have an inclusive Government in order to rally the Iraqi security forces and to be able to provide an appropriate defence against the ISIS incursion. Our focus at the moment is on encouraging the formation of such an inclusive Government in Baghdad. Once a Government with broad legitimacy in the country is established, we will be open to considering requests for technical advice and support from that Government to reinforce the Iraqi security forces.

[John Glen]

I welcome my right hon. Friend’s initial answer. Does he agree with me that it is critical for the UK to remain close to all the regional players, including Jordan and Qatar, so that maximum influence can be brought to bear if any of these individual countries get drawn into Iraq’s internal security challenges in different ways?

[Mr Hammond]

I agree with my hon. Friend that it is vital that we remain engaged with the key countries in the region, and we will do so. It is vital, too, that we are acutely mindful of the pressures that the Governments of Jordan and Lebanon are under as a result of what is going on in Syria and Iraq. These are two very important countries, and we will do everything we can to support them in these difficult times.

[Rehman Chishti]

In my right hon. Friend’s discussions with his counterparts in the middle east, did they say whether Mr Maliki was the right person to lead Iraq or whether former Prime Minister Allawi, having had excellent relations with Sunnis in Iraq and the wider middle eastern countries, is the right person to take Iraq forward?

[Mr Hammond]

Not all the Governments of our key allies in the middle east have such an understanding of the democratic process as we do. It is very clear to us in this country that it is not for us to comment on who should be the Prime Minister of a country following a democratic election. It is clear that the Government of Iraq need to be inclusive, and in direct answer to my hon. Friend it would be fair to say that there is a range of different views among middle east countries about the appropriateness of various individuals to lead such an inclusive Government.

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

Twenty years ago, John Major’s Government supported the Kurds and quite rightly protected them against Saddam, while Tony Blair’s Government did the same. Is it not now time for the British Government to recognise that the Kurdish region of Iraq, which is democratic, pluralistic and inclusive, needs support to defend itself against al-Qaeda-linked terrorism, and to support the pluralism and democracy that will grow from that region into the rest of Iraq?

[Mr Hammond]

The hon. Gentleman will know that the Foreign Secretary went to Erbil on his recent visit to Iraq. The British Government’s position is clear: we need to keep Iraq as a unified state. The one thing that I heard in every one of the capitals I visited in the Gulf is that Iraq needs to remain a unified state. We should devote our efforts to trying to achieve that outcome—a unified state with a pluralistic Government.

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

I want to pursue the answer that the Secretary of State gave to the hon. Member for Salisbury (John Glen). Jordan is extremely important, so I think there is a collective responsibility to build up that country’s resilience. Will the right hon. Gentleman say a little more about what precisely we are doing?

[Mr Hammond]

The UK has excellent military-to-military relationships with Jordan. We send troops there for training for our own purposes and we provide technical support and assistance to the Jordanian armed forces. Many Jordanian officers come to the UK for training. We will continue to support the Jordanian armed forces and the Jordanian Government in every practical way we can.

[Mr Jim Cunningham (Coventry South) (Lab)]

Have the Government given any thought to the aftermath if they cannot get agreement on a broad-based Government for Iraq? What is likely to happen after that?

[Mr Hammond]

It is not for us to get agreement on a broad-based Government; it is for the Iraqi people to seize the moment to ensure the future continuity of Iraq as a unitary state. That is not assured. Clearly, there are three separate regions within Iraq, any one of which could seek autonomy if a broad-based Government in Baghdad is not formed. We have to devote our present energies to seeking to ensure that outcome.

[Sir Menzies Campbell (North East Fife) (LD)]

May I ask my right hon. Friend to return to the issue of Jordan? That country is under grave pressure as a result of the influx of refugees. It is a country that is generally recognised to be both politically and economically fragile. The fact that ISIS has expanded its activities to such an extent that people believe Jordan could be menaced serves only to underline the importance of our assistance to a country that is enormously important to us, not least on account of its being a very long-standing ally. Can we be assured that this Government will understand the urgency of Jordan’s position and do everything feasible to ensure that it does not succumb to the undue influence of ISIS?

[Mr Hammond]

My right hon. and learned Friend is absolutely right. Jordan is a key ally in the region. Crown Prince Faisal will be at Farnborough tomorrow, and we look forward to discussing these issues with him. However, what my right hon. and learned Friend has said also emphasises the need for us to look at the impact of ISIS on a cross-regional basis. Lebanon, Syria, Iraq and Jordan are all affected by its activities, and the threat that those activities represent will also be felt by many states in the Gulf and, indeed, in the west.

[John Robertson (Glasgow North West) (Lab)]

4. What the Government's priorities are for the NATO summit in Wales.

[The Parliamentary Under-Secretary of State for Defence (Dr Andrew Murrison)]

Let me begin by paying tribute to the hon. Gentleman’s constituents and other shipbuilders on the Clyde for their tremendous achievement in creating HMS Queen Elizabeth.

The Government have three clear priorities for the NATO summit in Wales. First, we will mark NATO’s achievements in Afghanistan, recognise the sacrifices that it has made, and draft the next chapter in our enduring support for the Afghan people. Secondly, we will send Russia the clear message that NATO has the necessary capabilities and intent to provide for the collective security of the alliance by means including the deterrence of further Russian aggression. Thirdly, those capabilities will also contribute to addressing the numerous challenges that emanate from an unstable world in NATO’s neighbourhood and further afield. In particular, we will underscore transatlantic unity through a commitment to defence spending and practical security sector support for NATO’s partners and friends.

[John Robertson]

I thank the Minister for that extensive answer, and on behalf of the 2,000 workers in my local shipyard and other yards throughout the United Kingdom I thank him for his kind words.

I am a member of the NATO Parliamentary Assembly, and, as such, I have meetings with NATO parliamentarians from the United States and Europe. They are of the opinion that Georgia should be given a membership action plan at the Wales summit. What is the United Kingdom’s view?

[Dr Murrison]

Let us be clear: this is not an enlargement summit. However, at a recent meeting, NATO Foreign Affairs Ministers determined that Georgia should be encouraged and given every support that it needs in its aspirations. They also considered other aspirants to NATO, and similar programmes have been mapped for them.

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

Given the importance of the Russia-Crimea issue to the NATO summit, and given the importance of the UK’s showing leadership at the summit, does it not provide a unique opportunity for us to make a statutory commitment to spending no less than 2% of our GDP on defence?

[Dr Murrison]

My hon. Friend is tempting me, but, in resisting his proposition, let me suggest to him ever so gently that our intent is to encourage other partner nations to step up to the plate and make their fair contribution. If we are to enjoy the insurance policy, we must pay the premium. Too many of our partners in this endeavour have yet to spend a proper proportion of their GNP on defence, and that must be our priority.

[Yvonne Fovargue (Makerfield) (Lab)]

Cyber is certain to be a priority at the NATO summit, as it is a growing threat. Today there was an announcement of increased resources for ISTAR—intelligence, surveillance, target acquisition and reconnaissance—and cyber defence. However, the Secretary of State is seeking to sell off military spectrum capability. What work has been undertaken to establish the possible effects of that on military communications and equipment, given that it is an increasingly critical area?

[Dr Murrison]

We are, of course, keeping the spectrum that we need. I am very pleased that the hon. Lady welcomes today’s announcement, which is a result of prudent management of the defence budget early in the current Parliament. Let me also gently point out to her that this country has been independently assessed as being No. 1 in respect of preparedness for a cyber attack. Most of that is due to close co-operation between the Government and the commercial sector, which is vital in preparing this country to face down a possible cyber attack.

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

Article 5 of the NATO treaty currently specifies that if there is armed aggression against any member, there will be a collective military response, but of course most of the Russian activity in the eastern Ukraine has not been armed; it has been deniable, special forces and asymmetric. If there were similar Russian activities against the three Baltic states, would that constitute an Article 5 moment, and, if not, does article 5 need redefining, or perhaps even adjusting or changing, at the summit?

[Dr Murrison]

Article 5 stands. It is very clear, and any potential aggressor needs to fully understand the implications of it. My hon. Friend mentions Ukraine and, of course, we have been clear that the solution to Ukraine is primarily not military, but economic and commercial, and has to do with energy security, and that is where we are putting our efforts.

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

5. What recent discussions he has had with his NATO counterparts on the situation in the middle east.

[The Secretary of State for Defence (Mr Philip Hammond)]

I have regular discussions with the principal NATO Defence Ministers on issues of current concern, including the middle east. I attended the NATO Defence Ministers meeting in Brussels on 3 and 4 June, I met the US Deputy Secretary of Defence on 3 July in the margins of the naming of HMS Queen Elizabeth at Rosyth, and I will meet my French counterpart for talks at Farnborough tomorrow.

[Miss McIntosh]

Given the increasing insecurity in the middle east and the crucial role NATO will be playing, what commitment has my right hon. Friend received from our European partners that they will also step up to the plate and commit to spending up to 2% of their GDP on defence?

[Mr Hammond]

There is an ongoing discussion among the European NATO partner nations about how to respond to the perfectly fair challenge the United States has set us, by asking the question: why should US taxpayers be prepared to pay for a defence of Europe that European taxpayers appear to be rather reluctant to pay for? I have to say to my hon. Friend that this discussion has been rather more fruitful and productive than I was initially expecting, and I am optimistic that we may reach agreement on a declaration at the NATO summit in Wales this autumn that will set a baseline for moving European NATO spending forward as the European economies recover.

[Mrs Madeleine Moon (Bridgend) (Lab)]

Turkey is a critical ally within NATO. It is also struggling to manage the large numbers of refugees who have come over its borders both from Syria and Iraq. Can we be very clear in sending out a message to other nations also at the Newport summit that we will not stand by and see Turkey attacked before coming to its support?

[Mr Hammond]

Turkey is a full member of the NATO alliance and benefits from the article 5 guarantee that the Minister, my hon. Friend the Member for South West Wiltshire (Dr Murrison), referred to a few moments ago, so Turkey can be assured that the alliance will stand behind it both militarily and, perhaps of more immediate importance, in providing assistance to it with the huge humanitarian challenge it is facing from this influx of refugees.

[Bob Stewart (Beckenham) (Con)]

Given the insecurity in Ukraine and the middle east, is the MOD giving any thought to reconstituting the Allied Command Europe rapid reaction force?

[Mr Hammond]

Such a move would be a matter for SACEUR—Supreme Allied Commander Europe. I have not heard of any such ongoing consideration at the moment, but I am happy to check my facts and get back to my hon. Friend if I am wrong.

[Ms Diane Abbott (Hackney North and Stoke Newington) (Lab)]

The Secretary of State will be aware of the widespread public concern about the current conflagration in Gaza, and the women and children either dying or threatened with death. I am aware that there is a statement this afternoon, but none the less my constituents will expect me to be telling the Secretary of State that they hope that every arm of Government will be bending every sinew to work towards a ceasefire.

[Mr Hammond]

Of course, the Government’s position is that there must be an urgent ceasefire and, although we have been saying this for a very long time, there must be progress towards a two-state solution, however challenging achieving that sometimes appears. My right hon. Friend the Foreign Secretary will make a statement shortly. The role of the MOD in this matter is not central and I hope it remains not central; it is a Foreign Office lead and I am sure my right hon. Friend will be happy to answer the hon. Lady’s question more fully.

[Jesse Norman (Hereford and South Herefordshire) (Con)]

6. What progress he has made on strengthening the military covenant.

[The Minister for the Armed Forces (Mr Mark Francois)]

The armed forces covenant is a symbol of the debt we owe to servicemen and women, veterans, and their families. As the House will be aware, my right hon. Friend the Secretary of State for Defence reports annually to Parliament on progress in implementing the covenant.

Since the last report was published in December 2013, significant achievements include the allocation of £40 million to fund accommodation projects for veterans and the establishment of the £200 million forces Help to Buy Scheme. I am also delighted to say that the vast bulk of local authorities in Great Britain, from borough councils to county councils, have signed a community covenant, a tangible commitment to supporting our armed forces

[Jesse Norman]

I welcome today’s announcement of released extra investment in special forces, which will be very welcome in my constituency. The Royal British Legion and SSAFA have set up a new military charities advice service in Hereford and in Ross-on-Wye, supported by Herefordshire council. Will the Minister join me in praising the volunteers who staff that new service, and the council, which has taken a leading role in promoting the community covenant?

[Mr Francois]

I am very happy to praise my hon. Friend’s council and the volunteers who do such vital work for the wider armed forces community, and I am extremely happy to praise those two very good charities, not least as we in the Ministry of Defence have for some while been encouraging charities to work more closely together—what one might in the military community call the principle of combined arms—and to see these two great charities combining forces for the benefit of the wider armed forces family is excellent, and I commend them for their efforts.

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

The Prime Minister has found rather a large amount of cash down the back of the Secretary of State’s sofa, with which he is now playing catch-up with the UK’s defence capabilities. But did any of the Ministers argue at any point that some of this money should be spent on armed forces housing, which remains a key priority for armed forces families, or in addressing the unfairness in the previous war widows’ pension schemes? I remind the Minister that the noble Lord Astor has estimated the cost of sorting out one of those schemes at £70,000 a year.

[Mr Francois]

I thank the hon. Lady for her welcome for our equipment announcement today. The Government are committed to removing the disadvantage faced by our armed forces, and that is why we enshrined the key principles of the covenant in law. We have committed £105 million during the past four years to upholding the covenant; £30 million for the community covenant; £35 million for the LIBOR fund; and £40 million to fund a range of accommodation projects for veterans. In addition, £10 million per annum will be available in perpetuity to support the commitments for the armed forces covenant from 2015.

[Stephen Metcalfe (South Basildon and East Thurrock) (Con)]

9. What steps he is taking to ensure that the commitment and sacrifice of the armed forces is recognised by the public.

[Mr Mark Harper (Forest of Dean) (Con)]

15. What steps he is taking to ensure that the commitment and sacrifice of the armed forces is recognised by the public.

[The Minister for the Armed Forces (Mr Mark Francois)]

I am in no doubt whatsoever that the British public are incredibly proud of the men and women who serve in our armed forces. This pride was emphatically displayed at this year’s Armed Forces day, which was a resounding success. The national event in Stirling was attended by more than 35,000 members of the public, and across the rest of the UK more than 200 regional events were organised by local authorities and community groups, including one at Woolwich barracks, which I was delighted to attend. I am told that social media activity around Armed Forces day this year reached more than 3 million people.

[Stephen Metcalfe]

Will the Minister join me in congratulating organisations such as ABF The Soldiers’ Charity, for which I recently jumped out of a plane; the Essex Military Support Association, which organised the excellent South Essex Armed Forces day; Basildon council, which has awarded the Royal Anglian Regiment the freedom of the borough; and a group of residents who have recently refurbished the Stanford-le-Hope war memorial? As well as the Government having a role, does he agree that the community has a wider role as well?

[Mr Francois]

In the 1990s, I served on Basildon council, once described as the only local authority in the United Kingdom where at council meetings the council has actively heckled the public gallery. I commend what it has done for the covenant, I commend the Essex Military Support Association, an event that I attended in Armed Forces week, and I particularly commend my hon. Friend for courageously jumping out of a perfectly serviceable aeroplane in support of ABF The Soldiers’ Charity and the wider armed forces community. He did a brave thing and we commend him for it.

[Mr Harper]

May I also draw the Minister’s attention both to my local regiment, the 1st Battalion the Rifles, which demonstrated commitment and sacrifice on its two tours of Afghanistan when, sadly, it took a number of losses, and to Captain Angus Buchanan VC who won his Victoria Cross in the first world war saving two of his wounded comrades? His Victoria Cross has been bought by the noble Lord Ashcroft and is shortly to go on display in the Imperial War museum.

[Mr Francois]

I pay tribute to all those who have won the Victoria Cross, the highest award for valour that this country can possibly convey. As we approach 4 August and the commemoration of the first world war, I am sure that Members from all parts of the House are very conscious of those who have made the ultimate sacrifice in defence of our freedom. It was Pericles who said:

“Freedom is the sole possession of those who have the courage to defend it.”

They had that courage and we remember them.

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

I recently had the honour of attending the rededication of a refurbished war memorial in Whitburn village in West Lothian, which had been taken in hand by the local community, aided by local councillor George Paul. Added to the memorial was the name of Sapper Robert Thomson of the 35th Engineers, who was killed in Iraq in 2004, and one of the most poignant moments was when his mother laid flowers beneath his name. What are the Government doing to encourage and assist communities to add the names to war memorials of those members of the armed forces who have died in recent conflicts?

[Mr Francois]

I have been impressed by a number of schemes across the country in which local authorities and schools have taken a greater interest in war memorials. For instance, I have heard about projects where primary schools have been invited to research the names of those who are on war memorials. We all know why that is fundamentally important. I was at the National Memorial Arboretum yesterday to attend the unveiling of a monument to the Essex Regiment, the Second Battalion of which came up the beach on D-day. We say on Remembrance Sunday, “They will never be forgotten.” They never will.

[Paul Blomfield (Sheffield Central) (Lab)]

10. What the Government's policy is on bereavement leave for parents and spouses of armed forces personnel killed during service.

[The Parliamentary Under-Secretary of State for Defence (Anna Soubry)]

The Government are employers in two respects. Anyone in the civil service who finds themselves in this horrible position can apply for up to five days of paid leave, which can be extended depending on the circumstances. Members of the armed forces who lose a loved one in service are entitled to up to four weeks of paid compassionate leave.

[Paul Blomfield]

I thank the Minister for her reply. My constituent Bill Stewardson lost his son Alex who served with the Duke of Lancaster’s regiment in Basra in 2007. On his next working day, Bill was told by his manager:

“You can have one day’s carer’s leave for the funeral— and we don’t have to give you that.”

Since then Bill has campaigned tirelessly for statutory bereavement leave for the parents of members of the armed forces lost on active service. Does the Minister agree that that is the least we can do and will she work with colleagues to bring forward such proposals?

[Anna Soubry]

I am aware of the case that the hon. Gentleman raises, and I congratulate him and his constituent on their campaign. This is actually a matter between employers and employees, and it is also a policy direction under Department for Business, Innovation and Skills, but that does not preclude me, or other Ministers, from having a view. I would not be in favour of putting such a proposal in statute; it would be far too complicated and difficult—[Interruption.] The hon. Member for North Durham (Mr Jones) is chuntering as ever, but he obviously has not given the matter much thought. I imagine that there will be many others who will also want to have that sort of bereavement leave. Statute is not the way to do this. The way to do it is for employers to do the right thing by all of those who face such circumstances, just as we must do in Government.

[Bridget Phillipson (Houghton and Sunderland South) (Lab)]

11. What progress his Department has made on the next strategic defence and security review; and if he will make a statement.

[The Parliamentary Under-Secretary of State for Defence (Dr Andrew Murrison)]

The Government’s priority remains the delivery of the outcomes of the 2010 SDSR which was launched in May 2010 and published in October that year. The next review will of course be after the general election, and therefore its direction will be a matter for the next Government. The MOD, alongside other Government Departments, is engaged in early preparatory work that will feed this as part of a Cabinet Office-led process.

[Bridget Phillipson]

The Minister will know that civilian contractors already play an important role in responding to the growing cyber-security threat that we face as a country. But what further consideration will he give to reviewing recruitment procedures in order to consider direct recruitment to some of those specialist roles, so that we can meet the cyber-threats of the future.

[Dr Murrison]

I am grateful for the hon. Lady’s question. Reserve forces were mentioned in response to an earlier question and cyber-capability is one of those niche areas in which reserves will be able to bring something to the piece. This is a difficult and complex area and as we move forward into a different defence environment, we must think carefully about the new niche capabilities that we need.

[Crispin Blunt (Reigate) (Con)]

Army 2020 doubled the savings expectations from the Army following the strategic defence and security review. Reserve capability is important. What is the training strength of the Army Reserve today?

[Dr Murrison]

I am a reservist, so I should really know the number off the top of my head, but from memory it is a little shy of 20,000.

[Vernon Coaker (Gedling) (Lab)]

It would be churlish not to start by wishing everyone well in the forthcoming reshuffle—[Interruption.] I knew that comments would be made; I do not mind.

Given the importance of the question, I am absolutely amazed that the Under-Secretary of State for Defence, the hon. Member for South West Wiltshire (Dr Murrison) is answering and not the Secretary of State. How does today’s announcement by the Prime Minister relate to decisions taken in the previous strategic defence and security review in 2010 and to preparations for next year’s review? Where has the money been taken from? The Prime Minister has cut hundreds of special forces personnel, but he now says that the special forces are being given additional capability. He said that he had saved money by scrapping Sentinel, but now says that that money might be used to keep it. Is it not the case that today’s announcement has as much to do with PR for an ailing Government as it does with an SDSR for the country’s future?

[Dr Murrison]

Today’s announcement comes from proper financial prudence and the proper management of a budget, something which the previous Labour Administration so signally failed to do. If I may say so, my right hon. Friend the Secretary of State deserves a great deal of credit for bringing our defence budget back into balance, which is why the Prime Minister is able to announce £1.1 billion of investment. It is a pity that the Labour party does not welcome that a little more fully.

[Vernon Coaker]

It is the same old song, but this Government’s record does not stand up to scrutiny, which is what we are discussing today. Four years on from the previous SDSR, the Government have given a little with one hand, having spent four years taking far more away with the other. The Secretary of State has gone from denying there was an underspend to saying that it was earmarked for future equipment costs and to saying that it was for contingency. He now announces that it will be spent on things that were cut in the first place. Will he finally admit that he does not have a grip on where the Department is going or what it is doing about the SDSR and that he is just making it up as he goes along?

[Dr Murrison]

Oh dear, oh dear. The hon. Gentleman is inhabiting a parallel universe. The Labour party left a £34 billion black hole in 2010, and it has taken some tough decisions to bring us to where we are today. Today saw the announcement of £1.1 billion of spending and a further £160 billion over a 10-year period. Where would we have been had the Labour party still been in power four years on?

[Mark Pritchard (The Wrekin) (Con)]

12. What recent representations he has received on future employment at MOD Donnington; and if he will make a statement.

[The Parliamentary Under-Secretary of State for Defence (Mr Philip Dunne)]

rose—

[Mr Speaker]

The Secretary of State has an uncharacteristically ashen face, but I am sure that the sensation will pass.

[Mr Dunne]

As my hon. Friend the Member for The Wrekin (Mark Pritchard) knows, I have visited MOD Donnington a couple of times. My most recent visit was on 15 May, when I had the opportunity to meet representatives of both staff and the trade unions. I have received representations from both hon. and right hon. Members of the House, including from my hon. Friend and parliamentary neighbour.

[Mark Pritchard]

I am grateful for that reply. While I may not be right honourable, I nevertheless hope that MOD Donnington will feature in the Minister’s thinking over coming weeks as he decides on the successful bidder for the future logistics of Her Majesty’s armed forces.

[Mr Dunne]

As my hon. Friend knows, we are currently engaged in introducing private sector management skills into the logistics and defence support group activities carried out at Donnington. Both are at advanced stages of negotiation, so I am unable to give him any more information at this point about the competition. However, as soon as a decision is reached, he will be one of the first to know.

[Henry Smith (Crawley) (Con)]

13. What assessment he has made of the recommendations of the concluding report of the Trident commission set up by the British American Security Information Council.

[The Secretary of State for Defence (Mr Philip Hammond)]

I welcome the commission’s conclusion that while there remains the possibility of a direct nuclear threat to the UK, we should retain our nuclear deterrent. We are clear that for this to be effective we need to retain a continuous at-sea deterrent posture, as we have for the past 46 years.

[Henry Smith]

I am grateful to my right hon. Friend for that answer, with which I wholeheartedly agree. Will he confirm that the British American Security Information Council Trident commission report did not consider a two-boat solution?

[Mr Hammond]

My hon. Friend makes a very good point. There have been suggestions that, to save a relatively small sum of money, Britain should abandon continuous at-sea deterrence and opt for a part-time deterrent, with boats tied up alongside or even sent to sea without nuclear weapons on board. I can assure my hon. Friend that the Government firmly reject such advice and I can further assure him that a Conservative Government will never take risks with Britain’s strategic security.

[Mr Speaker]

Time for the good doctor. I call Dr Julian Lewis.

[Dr Julian Lewis (New Forest East) (Con)]

In welcoming what the Secretary of State for Defence has said, may I remind him that those on the Labour Front Bench have similarly committed to the retention of Trident and continuous at-sea nuclear deterrence? Does he therefore agree with me that whatever the complexion of the next Government, there can be no possible excuse for failing to renew Trident—whether in coalition, in government or in opposition? Wherever we are, we all ought to be committing to renewal in the next Parliament.

[Mr Hammond]

I absolutely agree with my hon. Friend that there is no possible excuse for not doing something that is absolutely necessary to Britain’s long-term strategic protection. However, I note that there are two parties represented in the Chamber this afternoon that do not support that agenda.

[Priti Patel (Witham) (Con)]

14. What his policy is on the future of the UK’s nuclear deterrent.

[The Secretary of State for Defence (Mr Philip Hammond)]

Government policy remains as set out in the 2010 strategic defence and security review: we will maintain a continuous submarine-based deterrent and are proceeding with the programme to replace our existing submarines.

[Priti Patel]

There are potential threats from hostile regimes around the world, and I have heard what the Secretary of State has already had to say. Does he agree, however, that any surrender of our deterrent would not only leave us vulnerable but weaken our position as a permanent member of the UN Security Council?

[Mr Hammond]

My hon. Friend is exactly right, although of course we maintain our strategic deterrent as the ultimate guarantee of our sovereignty and independence of action. It is worth remembering that there are still 17,000 nuclear weapons in the world, and so long as that is the case, we must be able to protect the British people against them.

[Mr Speaker]

As the hon. Member for Moray (Angus Robertson) just had the finger rather distinctly pointed at him, I rather thought that he might be pricked into responding.

[Angus Robertson (Moray) (SNP)]

indicated dissent.

[Mr Speaker]

It appears not. Never mind, he is a model of calm and patience. We will move on—I think we will get Sir Peter Luff in.

[Sir Peter Luff (Mid Worcestershire) (Con)]

17. What plans he has to encourage public debate on the defence needs of the UK in advance of the strategic defence and security review in 2015.

[The Parliamentary Under-Secretary of State for Defence (Dr Andrew Murrison)]

Public debate on defence matters and Britain’s place in the world is always welcome and the Ministry of Defence encourages this through its frequent engagement with Parliament. We also routinely engage with the service community, academics, think-tanks and other stakeholders in the course of policy formulation and I would expect this to accelerate in advance of the formal Cabinet Office-led cross-Government SDSR.

[Sir Peter Luff]

Given the importance of winning the informed consent of the British people for the payment of the insurance premium that guarantees our freedom and security, will my hon. Friend commit to following the good, if somewhat belated, example of the previous Government and publishing a Green Paper to build consensus ahead of the next SDSR?

[Dr Murrison]

The precise questions to be asked and the nature of the asking are a matter for the next Government, since this review will take place after the general election. Of course, both parties, of which one is likely to form the next Government, are represented in the Chamber today and I have no doubt that they are listening to what my hon. Friend has to say.

[Karl MᶜCartney (Lincoln) (Con)]

T1. If he will make a statement on his departmental responsibilities.

[The Secretary of State for Defence (Mr Philip Hammond)]

My first priority remains our operations in Afghanistan and the successful completion of the draw-down of our combat role by the end of this year. Beyond that, my priority is delivering Future Force 2020 by maintaining budgets in balance, building our reserve forces, reinforcing the armed forces covenant and reforming the defence procurement organisation so that our armed forces get the equipment they need at a price the taxpayer can afford.

[Karl MᶜCartney]

I recently attended the wonderful and much loved annual RAF Waddington international air show, but the Minister will know that next year’s show has been cancelled by the board of the RAF to accommodate refurbishment work to the runway. Although I am pleased that the work is taking place, the air show generates more than £12 million for the Lincolnshire economy and about £500,000 for forces charities, so can the Minister reassure me and my constituents that the air show will return to the base in “bomber county” north of London in 2016-17, and certainly in time for the 100-year anniversary of the RAF?

[The Parliamentary Under-Secretary of State for Defence (Mr Philip Dunne)]

My hon. Friend is right to draw attention to the great success of the air show at RAF Waddington, which I believe he attended the other day. He is also right to point out that the runway is in need of routine maintenance—essentially, a new runway needs to be laid, which will take 59 weeks starting in September—and therefore it will not be available next year. The RAF is undertaking a review of all air show commitments for next year, so we will be in a better position to respond on 2016 when that review has been completed.

[Alison Seabeck (Plymouth, Moor View) (Lab)]

The Government made a clear decision in the 2010 SDSR to withdraw the important Sentinel capability from service. There is now speculation that it is to be retained, although it is not named in the news release that has gone out—it sort of slipped under the media radar. Does the Secretary of State accept that, like the F-35 U-turn costing millions, this is another example of poor strategic decision making and more back peddling?

[Mr Philip Hammond]

No, and I think the hon. Lady will find that the capability was mentioned in the announcement that has been issued. The decision was made to take Sentinel out of service at the end of the campaign in Afghanistan, for reasons of affordability. I am pleased to be able to tell the House that, because of careful husbandry of the defence budget, we have now been able to take the decision to extend Sentinel once the Afghan campaign has ended, at least until 2018. That will allow us to look at the capabilities that Sentinel delivers—wide-area surveillance of fast-moving ground targets—in the context of our broader need for wide-area surveillance capability, both maritime and over land.

[Martin Horwood (Cheltenham) (LD)]

T2. The F-35 Lightning II should be one of the world’s most advanced combat aircraft, not least thanks to British expertise at companies such as GE Aviation and Ultra Electronics, but it was sadly missed at Gloucestershire’s royal international air tattoo—a very exciting event this weekend. Can Ministers reassure the House that that has no implications for its service for the United Kingdom from 2018?

[Mr Dunne]

My hon. Friend is right to draw attention to the importance of the F-35 programme to businesses up and down this country, including in Gloucestershire. Last year, the F-35 suffered an engine incident, which is being investigated. It is absolutely right that the safety of aircrew and aircraft are of paramount importance, rather than seeking to attend air shows around the world. Obviously, we would welcome the F-35 once it has been declared safe, and we are still hopeful that it will arrive at Farnborough before the air show finishes.

[Julie Hilling (Bolton West) (Lab)]

T7. Although today’s announcement is welcome for companies in my constituency such as MBDA, which is of course at Farnborough this week, does the Secretary of State think that announcing a re-spend on things that he cut in the first place will make up for the hundreds of millions of pounds wasted on botched decision making, bad equipment decisions, IT failure, a recruitment crisis and collapsed procurement reforms on his watch?

[Mr Philip Hammond]

I do not know who writes this stuff, but what has happened is very simple. We have got the defence budget under control. We have set up the armed forces committee, which comprises the chiefs of the individual services, and we have allowed them to set the priorities for requirements in the military equipment programme. As headroom becomes available, we accept their advice on the urgent priorities. They have identified a package of intelligence, surveillance, target acquisition and reconnaissance measures, which they consider now to be the highest priority for defence expenditure, and that is what we have announced today.

[Robert Jenrick (Newark) (Con)]

T3. British defence exporters, such as GDT in Newark, can take their stands at Farnborough today with renewed confidence as a growing part of our economy. GDT grew by 10% last year and the sector by 11%. What steps are the Government taking proactively with companies like GDT to ensure that this success continues?

[Mr Dunne]

I am very grateful to my hon. Friend for referring to the Farnborough air show, which I attended this morning for the Prime Minister’s opening. He was highlighting at Farnborough, not just to the British defence supply chain, but to representatives of the international supply chain who were present and to the international delegations visiting from abroad, just what a high-quality defence industry we have in this country, and as he pointed out, we cannot have a secure economic growth plan without a secure national security plan.

[Angus Robertson (Moray) (SNP)]

As we know from the recent services inquiry of the Military Aviation Authority, three of my constituents died aboard colliding Tornado jets above the Moray firth in 2012. Among the contributory factors may have been the absence of a collision warning system. When will we see a collision warning system installed in Typhoon aircraft?

[Mr Dunne]

As the hon. Gentleman knows, because he called an Adjournment debate on this subject last week, at which he asked that very question and I gave him the answer, at present we are investigating the introduction of a system on Typhoon, and at this point it is not appropriate to give him a timetable or a cost for that introduction.

[Mr Nigel Evans (Ribble Valley) (Con)]

T4. If Pericles were alive today, I am sure he would have been at the Farnborough air show, looking at all the amazing equipment that is available to defend our freedoms. One piece of equipment is BAE Systems’ Taranis unmanned air vehicle. Will my right hon. Friend assure the House that this Government will continue to support that technology to ensure that we have manufacturing and research and development capability for the future, both militarily and commercially?

[Mr Philip Hammond]

I am pleased to be able to tell my hon. Friend that I shall be signing with my French counterpart at Farnborough tomorrow the Anglo-French collaboration agreement on unmanned combat air vehicle research, which will support the programme in which BAE Systems is engaged.

[John Cryer (Leyton and Wanstead) (Lab)]

How many of the former soldiers sacked by the Secretary of State for Defence in historic acts of vandalism have found permanent employment—not employment on the basis of single-hours contracts or temporary employment, but permanent employment? Will he put the figures in the House of Commons Library?

[The Parliamentary Under-Secretary of State for Defence (Anna Soubry)]

We find that, among those who leave our armed forces, an incredibly high proportion—some 86%—find employment within six months. That is because they are eminently employable by virtue of the service that they give to our country.

[Sir Edward Leigh (Gainsborough) (Con)]

T5. The Red Arrows based at Scampton in my constituency are one of the most popular public faces of the RAF, but unfortunately their Hawk T1 aircraft ends its service in 2018. Can the Secretary of State give me an assurance that RAF Scampton has a future with the Red Arrows and that they will be provided with suitable aircraft?

[Mr Philip Hammond]

The decision on replacement aircraft for the Red Arrows does not have to be made until 2018, but my hon. Friend will have heard the Prime Minister say that, so long as he is Prime Minister, the Red Arrows will continue to fly.

[Mr Dennis Skinner (Bolsover) (Lab)]

Now that the Secretary of State for Defence might be leaving, having cut to the bone the armed forces to the lowest figure ever, many of them to be thrown on the scrapheap, is he looking forward to trying to employ them when he is in charge of the Department for Work and Pensions, or will he enjoy sorting out universal credit?

[Mr Hammond]

What I can say to the hon. Gentleman is that my Department has an excellent relationship with the DWP, looking at ways in which we can support those who are out of work and seeking to acquire the skills, soft and hard, necessary to get back into work, to get them into the reserve forces and trained in the reserve forces while looking for civilian employment at the same time. [Interruption.]

[Mr Speaker]

Order. An hon. Gentleman should not be talking about kicking people in an unspecified location. It is rather unseemly. I think I heard what he was driving at, if I may put it that way.

[John Glen (Salisbury) (Con)]

T8. In view of the uncertainty about the future of Public Health England at Porton Down and the imminent submission of the outline business case to the Treasury, will the Minister confirm that the Defence Science and Technology Laboratory is ready and willing to work collaboratively on a Porton-based solution for the future of the PHE facility there?

[Mr Dunne]

My hon. Friend is a valiant champion of all that goes on in and around Porton Down, and he is to be congratulated on the work he did in securing the science park funding last week. With regard to the CL4 facility at Porton Down, which is co-shared with Public Health England, the Ministry of Defence will be working with the Department of Health to ensure that the best solution is found for the country as a whole for the future of CL4 facilities.

[Nic Dakin (Scunthorpe) (Lab)]

What discussions has the Ministry of Defence had with North Lincolnshire council in recent weeks to ensure that the disposal of the Kirton in Lindsey base benefits the local community rather than damages it?

[The Parliamentary Under-Secretary of State for Defence (Dr Andrew Murrison)]

I am grateful to the hon. Gentleman for his question. As he knows—we have corresponded on the matter—discussions with the local authority are ongoing. Our intention is to ensure that the site has a use that accords with our need for disposals, but in a way that the local community will appreciate. I believe that we will end up in that position before very long.

[Mr David Heath (Somerton and Frome) (LD)]

T9. The naming of HMS Queen Elizabeth is extremely welcome, and it will be even more so when we have some planes to fly off her decks. When the First Sea Lord says that“continuous carrier availability… means having two carriers, not one… a modest extra premium to pay for an effective, a credible, an available, insurance policy”,does the Secretary of State agree?

[Mr Philip Hammond]

Whether to bring the second carrier into service is a decision for the SDSR in 2015, as we have always been clear. Equally, I have always been clear that my personal view is that when one spends £6.4 billion of taxpayers’ money building two ships, one had better strain every possible sinew to operate them both.

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

Before the Secretary of State finalises the agenda for the NATO summit, will he revisit his decision and stance on a statutory basis for spending 2% of GDP on defence? His hand would be infinitely strengthened if he could say to other NATO members that not only do we already spend 2%, but we are committed to continuing to do so on a statutory basis.

[Mr Hammond]

It is for NATO as an organisation to set the agenda for the summit, not the UK; we merely host it and pick up the bill for doing so. We have been in the lead in seeking to agree across the member states a statement about the future financing of NATO, a statement that will answer the challenge—I referred to it earlier—that the United States has been persistently and quite legitimately raising over the past couple of years. I am confident that we will have a positive statement to make at the NATO summit.

[Oliver Colvile (Plymouth, Sutton and Devonport) (Con)]

Given that Britain is an island state that is very dependent on our trade routes, has my right hon. Friend yet decided how many Type 26s we will need and where they might be base-ported?

[Mr Hammond]

The programme for Type 26 envisaged 13 frigates being ordered. It is likely that the fleet will be split, as the current frigate fleet is split, but no final decision has yet been made.

[Sir Bob Russell (Colchester) (LD)]

When does the relevant Minister expect to announce a decision on the normal pension age for workers in the defence fire and rescue service?

[Anna Soubry]

That is a long-running problem. As my hon. Friend will know, those in our defence fire and rescue service are actually employed as civil servants, so it is a difficult one, but we hope to make a decision as soon as possible.

[Dr Julian Lewis (New Forest East) (Con)]

As Ministers cannot sign early-day motions, may I exceptionally ask the Secretary of State for a comment on EDM 252, which commemorates the sacrifice of 7,000 British soldiers in the Normandy battle for Hill 112? It was tabled by my hon. Friend the Member for Stone (Sir William Cash). What it does not say is that his father was one of those 7,000: Captain Paul Cash won the Military Cross a few days before he was killed 70 years ago yesterday.

[Mr Hammond]

I was aware of the role our hon. Friend’s father played in that decisive engagement, and I am sure that the whole House will join the sentiment expressed in the EDM. It is one of a number of EDMs that Government Front Benchers regularly regret being unable, by convention, to sign, but I am very happy to have this opportunity to indicate my strong support for it.

[Mr Alan Reid (Argyll and Bute) (LD)]

When the Minister is taking a decision on the retirement age for defence, police and fire personnel, will she take into account the fact that the strenuous activity demanded by this job is more in line with the other uniformed services than with the majority of civil servants, and that I believe that a retirement age of 60 is appropriate?

[Anna Soubry]

Yes, indeed. Having been to see the work of the fire service myself, I am fully aware of all these arguments. As I say, I very much hope that we will be able to make a decision sooner rather than later.

Petition

Monday 14th July 2014 Commons Chamber

Chris Ruane (Vale of Clwyd) (Lab)

- Hansard - - Excerpts

I would like to present a petition to the House concerning pylons that will come from the Clocaenog wind farms. The wind farms are located outside my constituency, but the pylons will lead to St Asaph in my constituency. One wind farm is in place. That is connected by underground cabling. However, four more wind farms are proposed and those will have overground cabling.

The petition states:

The Petitioners therefore request that the House of Commons urges the Government to encourage local authorities to ensure that planning inspectorates recognise and carefully consider local residents’ views when making planning permission decisions and further that the House urges the Government to encourage Denbighshire County Council to show the same consideration to residents’ views in relation to the development of the Clocaenog wind farm as it has in the development of other wind farms.

Following is the full text of the petition:

[The Petition of residents of the Vale of Clwyd,

Declares that Clocaenog wind farm is currently being developed; further that the Petitioners believe that all cables connecting the wind farm to the electricity sub-station should be underground so as to minimise the visual impact on this beautiful area, to minimise the health risks to residents, to limit the devaluation in property prices and to respect the democratic will of the people of Henllan, Cefn Meiriadog and surrounding areas who unanimously voted to endorse the placing of these cables underground; further that Tir Mostyn, the first wind farm near Clocaenog Forest, placed its cables underground; and further that the offshore wind farms off the coast of Rhyl also placed its cables from the seashore to St Asaph underground.

The Petitioners therefore request that the House of Commons urges the Government to encourage local authorities to ensure that planning inspectorates recognise and carefully consider local residents’ views when making planning permission decisions and further that the House urges the Government to encourage Denbighshire County Council to show the same consideration to residents’ views in relation to the development of the Clocaenog wind farm as it has in the development of other wind farms.

And the Petitioners remain, etc.]

[P001366]

Gaza

Monday 14th July 2014 Commons Chamber

15:34

[The Secretary of State for Foreign and Commonwealth Affairs (Mr William Hague)]

With permission, Mr Speaker, I will make a statement on Gaza.

The House is aware that despite intense efforts by US Secretary of State John Kerry, talks between Israelis and the Palestinians broke down at the end of April and are currently paused. Since then, there have been several horrific incidents, including the kidnap and murder of three Israeli teenagers and the burning alive of a Palestinian teenager. We utterly condemn these barbaric crimes. There can never be any justification for the deliberate murder of innocent civilians.

These rising tensions have been followed by sustained barrages of rocket fire from Gaza into Israel. Between 14 June and 7 July, 270 rockets were fired by militants into Israel, to which Israel responded with air strikes. Rockets are fired indiscriminately against the civilian population, including against major Israeli cities. Israel then launched Operation Protective Edge on 7 July. Israeli defence forces have struck over 1,470 targets in Gaza, and over 970 more rockets have been fired towards Israel. Two hundred and forty Israelis have been injured. In Gaza, as of today, at least 173 Palestinians have been killed and 1,230 injured. The UN estimates that 80% of those killed have been civilians, of whom a third are children.

We have acted swiftly to ensure the safe departure of British nationals wanting to leave Gaza. Late last night, we successfully assisted the departure of 27 British nationals and their Palestinian dependants from Gaza, through Israel to Jordan for onward travel. I am grateful to the UN, to Foreign and Commonwealth Office staff from London, Gaza, Jerusalem, Tel Aviv and Amman, and to the Israeli and Jordanian authorities for their work to ensure the success of this operation.

The whole House will share our deep concern at these events. This is the third major military operation in Gaza in six years. It underlines the terrible human cost, to both sides, of the Israeli-Palestinian conflict, and it comes at a time when the security situation in the middle east is the worst it has been in decades. The people of Israel have the right to live without constant fear for their security, and the people of Gaza also have the fundamental right to live in peace and security. There are hundreds of thousands of extremely vulnerable civilians in Gaza who bear no responsibility for the rocket fire and are suffering acutely from this crisis; and the Israeli defence forces estimate that 5 million Israeli civilians live within range of rockets fired from Gaza. Israel has a right to defend itself against indiscriminate rocket attacks, but it is vital that Gaza’s civilian population is protected. International humanitarian law requires both sides to distinguish between military and civilian targets and enable unhindered humanitarian access.

The UK has three objectives: to secure a ceasefire, to alleviate humanitarian suffering, and to keep alive the prospects for peace negotiations which are the only hope of breaking this cycle of violence and devastation once and for all. I will briefly take each of these in turn. First, there is an urgent need for a ceasefire agreed by both sides that ends both the rocket fire and the Israeli operations against Gaza, based on the ceasefire agreement that ended the conflict in November 2012. Reinstating that agreement will require a concerted effort between Israelis, Palestinians and others, such as the authorities in Egypt, with the support of the international community. All those with influence over Hamas must use it to get Hamas to agree to end rocket fire.

We are in close contact with Israeli and Palestinian leaders and our partners and allies. The Prime Minister spoke to Prime Minister Netanyahu on 9 July, and in the past few days I have spoken to President Abbas, to Israeli Foreign Minister Lieberman and Strategic Affairs Minister Steinitz, and to Egyptian Foreign Minister Shukri. As Arab Foreign Ministers meet tonight, I have just discussed the situation with the Foreign Ministers of Jordan and Qatar.

On 10 July the UN Secretary-General told the Security Council that there was a risk of an all-out escalation in Israel and Gaza and appealed for maximum restraint. He had been in contact with leaders on both sides and other international leaders, underlining his concern about the plight of civilians and calling for bold thinking and creative ideas.

On Saturday we joined the rest of the UN Security Council in calling for the de-escalation of the crisis, the restoration of calm and the reinstatement of the November 2012 ceasefire. We are ready to consider further action in the Security Council if that can help to secure the urgent ceasefire that we all want to see. Yesterday, I held discussions in the margins of the Iran Vienna talks with Secretary Kerry and my French and German counterparts to consider how to bring about that objective.

Once a ceasefire is agreed, it will be vital that its terms are implemented in full by both sides, including a permanent end to rocket attacks and all other forms of violence. Implementation of that agreement must only be part of a wider effort to improve conditions in Gaza. Without that, we are likely to see further such cycles of violence. This should include the restoration of Palestinian Authority control in Gaza, the opening up of legitimate movement and access, and a permanent end to the unacceptable threat of rocket attacks and other forms of violence against Israel.

Secondly, we will do all we can to help alleviate humanitarian suffering in Gaza. At least 17,000 Gazans are seeking shelter with the UN. Hundreds of thousands are suffering shortages of water, sanitation and electricity, and stocks of fuel and medical supplies are running dangerously low. More than half the population was already living without adequate access to food before the crisis, the large majority reliant on aid and with many unemployed. The UK is providing £349 million for humanitarian relief, state-building and economic development for Palestinians up to 2015, and providing about £30 million a year to help the people of Gaza.

We are the third biggest donor to the UN Relief and Works Agency general fund. Our support has enabled it to respond to the crisis by continuing to provide health services to 70% of the population, sheltering 17,000 displaced people, and distributing almost 30,000 litres of fuel to ensure that emergency water and sewerage infrastructure can operate. The Department for International Development is helping to fund the World Food Programme, the International Committee of the Red Cross and the UN access co-ordination unit. With our support, these organisations are providing food to insecure people, helping to repair damaged infrastructure, getting essential supplies into Gaza, getting medical cases out and delivering emergency medical care. The Minister of State, Department for International Development, has spoken to Prime Minister Hamdallah, and DFID stands ready to do more as necessary.

Thirdly, a negotiated two-state solution remains the only way to resolve the conflict once and for all and to achieve a sustainable peace so that Israeli and Palestinian families can live without fear of violence. No other option exists which guarantees peace and security for both peoples.

I once again pay tribute to Secretary Kerry’s tireless efforts to secure a permanent peace. Of course, the prospect for negotiations looks bleak in the middle of another crisis in which civilians are paying the heaviest price, but it has never been more important for leaders on both sides to take the bold steps necessary for peace. For Israel, that should mean a commitment to return to dialogue and to avoid all actions which undermine the prospects for peace, including settlement activity which does so much to undermine confidence in negotiations. For Hamas, it faces a fundamental decision about whether it is prepared to accept Quartet principles and join efforts for peace, or whether it will continue to use violence and terror with all the terrible consequences for the people of Gaza. The Palestinian Authority should show leadership, recommitting itself to dialogue with Israel and making progress on governance and security for Palestinians in Gaza as well as the west bank.

In all these areas, the United Kingdom will play its role, working closely with US and European colleagues, encouraging both sides back to dialogue, supporting the Palestinian Authority, keeping pressure on Hamas and other extremists, and alleviating the humanitarian consequences of conflict. There can be no substitute, though, for leadership and political will from the parties concerned. The world looks on in horror once again as Israel suffers from rocket attacks and Palestinian civilians die. Only a real peace, with a safe and secure Israel living alongside a viable and contiguous Palestinian state, can end this cycle of violence. And it is only the parties themselves, with our support, who can make that peace.

15:45

[Mr Douglas Alexander (Paisley and Renfrewshire South) (Lab)]

I thank the Foreign Secretary for his statement and, indeed, for giving me advance sight of it this afternoon.

Today, a spiral of violence has again engulfed Gaza, southern Israel and the west bank, bringing untold suffering to innocent people in its wake. Of course, I unequivocally condemn the firing of rockets into Israel by Gaza-based militants. No Government on earth would tolerate such attacks on its citizens, and we recognise Israel’s right to defend itself.

As the Foreign Secretary set out, in recent days hundreds of rockets have been fired from Gaza at Israel, and at least three Israelis have been seriously injured. However, he was also right to acknowledge that, since the start of the Israeli military operation in Gaza just seven days ago, more than 170 Palestinians have been killed and thousands more have been injured. The UN has reported that more than 80% of those killed were civilians, and that a third of those killed were children. Although this conflict cannot and must not be reduced simply to a ledger of casualties, the scale of the suffering in Gaza today must be fully and frankly acknowledged, because the life of a Palestinian child is worth no less than the life of an Israeli child.

The Foreign Secretary has rightly condemned the horrific kidnap and murder of three Israeli teenagers and the burning alive of a teenage Palestinian, but although these repellent crimes seem to be the proximate cause of the latest spiral of violence, does he accept that the underlying cause of this latest crisis is the failure over decades to achieve a two-state solution for two peoples?

The spiral of violence of recent days is grimly familiar to anyone who remembers Operation Cast Lead in 2008-09 and Operation Pillar of Defence in 2012. The same bloodstained pattern is repeating itself. In the first operation, Israel declared a unilateral ceasefire. In the second operation, the Egyptians brokered one. Both times, it was clear that the conflict between Israel and Hamas could not be solved through force of arms alone. Does the Foreign Secretary therefore recognise that there can be no military solution to this conflict? Does he further accept that the scale of the suffering in Gaza, compounding the effects of the continuing blockade, serves to fuel hatred and, indeed, to embolden Israel’s enemies?

Does the Foreign Secretary agree that if the operating logic of Hamas is terror and the operating logic of Israel is deterrence, then pleas by the international community for restraint alone will be insufficient? Today, the risk of an all-out escalation in the conflict and the threat of a full ground invasion are still palpable—and preventable, if Hamas stops firing rockets.

As the Opposition, we are clear not only on the need for an immediate ceasefire, but that a full-scale ground invasion would be a disaster for the peoples of both Gaza and Israel, and a strategic error for Israel. Does the Foreign Secretary agree, and will he now make that position clear to the Israeli Government in the crucial hours and days ahead?

The Foreign Secretary spoke of the statements made by the UN Security Council on Saturday calling for a ceasefire, which I of course welcome. Alongside the Arab League at its meeting today, the UN must be forthright in its role of seeking to bring the recent violence to an end. Will he therefore support calls for the UN Secretary-General to travel to the region to act as a mediator between the two sides?

We know from bitter experience that a spiral of violence that reinforces the insecurity of the Israelis and the humiliation of the Palestinians leads only to further suffering. For Israel, permanent occupation, blockade and repeated military action in occupied land will make peace—and, ultimately, security—harder, not easier, to achieve. Alas, it is not a strategy for peace; it is a recipe for continued conflict.

The Foreign Secretary rightly and generously paid tribute to US Secretary of State Kerry’s considerable personal efforts to advance the middle east peace process, but, in truth, today there is no peace and there is also no process; instead there are continued rocket attacks and continued settlement expansion, growing fear and anxiety, and ongoing occupation.

I of course welcome the humanitarian efforts by both DFID and UNRWA that the Government have set out, but we all know that a humanitarian response, while vital, is not itself sufficient to end the suffering. In the past few days, Israel’s overwhelming military might has been obvious. Hamas, weakened today by Sisi’s rise in Egypt and differences with Iran over Syria, can avert the risk of an imminent ground invasion by stopping the rocket attacks, but Israel needs a strategy for building peace, not just tactics for winning the next round of war. This is a time and this is a crisis that demand not revenge, but statesmanship motivated by justice. Only politics, and a negotiated solution, offers a way forward to peace.

[Mr Hague]

I am grateful to the right hon. Gentleman for his questions, which show that we share the same analysis of the situation and offer a similar response. He said that he was clear that no Government on earth could tolerate such attacks, and that Israel had the right to defend itself. I also made that clear in my statement. We also share the analysis that, while what he called the proximate cause was the horrific murders that have taken place in recent weeks, the underlying cause is the failure to make progress in the middle east peace process. That is something to which we must continue to give our attention.

The right hon. Gentleman also mentioned the work of Secretary Kerry. I discussed these matters with Secretary Kerry yesterday afternoon in Vienna, and I can tell the House that he remains determined about the peace process despite everything that has happened, which is a great credit to him. He is determined that the United States will still play a leading role in pushing forward the process, and that this is a pause and not the end of the efforts to push it forward. We will continue to encourage him in that, and to help to deliver the support of the European Union.

I entirely agree with the right hon. Gentleman that there is no military solution to this, and that calls for restraint are important but not sufficient. We are very clear in our calls for restraint to all sides, including in the conversations I had with Israeli Ministers over the weekend, when I made it clear that we wanted to see restraint, proportionate response, de-escalation and the avoidance of civilian casualties. I think that the implications of such statements are very clear. We will support whatever role the UN Secretary-General can take in this.

The right hon. Gentleman was right to draw attention to the fact that Egypt played an important role in the November 2012 ceasefire. That is why I have been having discussions with the Egyptian Foreign Minister in recent days. On this occasion, other Arab states are also active in trying to bring about an agreed ceasefire. That is why I have been discussing this with other Arab Foreign Ministers before their meeting tonight, and we will continue to encourage them to do that. I believe that there is a common analysis, and a common appeal for a renewal of the peace process instead of a continuation of the violence, right across the House.

[Mr Speaker]

I call Mr Nicholas Soames.

[Sir Nicholas Soames (Mid Sussex) (Con)]

Thank you, Mr Speaker. Does my right hon. Friend agree that this is not just a war about rockets from both sides, and that it is a war about illegal settlements and stolen lands? What is the next big political move? I have sat here these last 30 years and heard the same statement every year; for 30 years, nothing has happened.

[Mr Speaker]

My apologies, Sir Nicholas. I thank you for that question and I congratulate you on your richly deserved knighthood.

[Mr Hague]

And I very much join in those congratulations, Mr Speaker.

I am conscious of the point that my right hon. Friend makes about how long we have been hearing these statements. Indeed, I have delivered quite a few of them myself, both in opposition and in government. To be speaking for the third time in six years about an almost identical conflict is deeply exasperating for all of us who deal with international relations. He asked what the next milestone would be. It will be a continuation of the United States’ effort. I believe that, in the end, only the United States can help to deliver Israel into a peace agreement and a two-state agreement. We in Europe have an important role in supporting that, and we have offered unprecedented economic co-operation and partnership with the Israelis and the Palestinians if a peace process can be concluded. Let us hope that both sides can grasp that vision.

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

Does the Foreign Secretary recall that all Israeli settlers and soldiers left Gaza in 2005? Does he agree that Hamas has carried out a double war crime by targeting Israeli citizens with more than 900 rockets in the past month and launching those rockets from bases in the middle of the Gazan population?

[Mr Hague]

We make the point strongly to Israel about avoiding civilian casualties and observing international humanitarian law, and the hon. Lady is right to say that when those rockets are launched against Israel, their only purpose is to cause civilian casualties there. There is not even a pretence of observing international humanitarian law. As the shadow Foreign Secretary has said, no nation on earth could tolerate that, but it is important that the response should be proportionate and that it should observe international humanitarian law. The hon. Lady is also right to say that what has happened in Gaza since the Israeli withdrawal is taken in Israel as a lesson in not withdrawing in the future, and that is a tragedy for all concerned.

[Sir Menzies Campbell (North East Fife) (LD)]

I have not been here quite as long as the right hon. Member for Mid Sussex (Sir Nicholas Soames), but I certainly share his frustration, and I suspect that it is shared in all parts of the House. It is wholly unacceptable that the people of Israel should be subject to random and indiscriminate rocket attacks, but it is equally unacceptable that the response of the Israeli Government should be disproportionate, contrary to international law and at the expense of civilians, particularly children.

[Mr Hague]

It is. The frustration from all quarters of the House is very clear, and I absolutely share it. The Government have to focus on what we can do to help to bring an end to what is unacceptable for both populations. I think that that is to work diplomatically to bring about an agreed ceasefire, to do our utmost to provide humanitarian relief and to work to ensure that the peace process can be revived.

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

Is the right hon. Gentleman aware that among the 173 innocent civilians slaughtered by the Israelis in Gaza was the inhabitant of a disabled people’s home that was hit by Israel, and that a hospital was also hit? Whatever one says in deploring the role of Hamas— I have told the Hamas Prime Minister to his face that I deplore what it does—if this goes on, we shall have yet another cycle, which will be the third so far, and a fourth, and it will go on. Unless the Israelis are willing to make peace, the day will come when the Palestinians explode in anger and despair.

[Mr Hague]

The right hon. Gentleman speaks passionately and sincerely. I can imagine him saying what he said to the face of Hamas. He is right that if the cycles of violence go on, the prospect of peace in the middle east will get further away. That is after an immense effort has been made in recent years to bring the sides closer together and to work on a final status agreement. His warnings should be well heeded by all in the middle east, and they show that our work on the peace process has to go on.

[Mrs Cheryl Gillan (Chesham and Amersham) (Con)]

While I condemn the violence on both sides of the border, the Foreign Secretary will be aware that, despite the deteriorating situation, the Israelis are still facilitating the much needed delivery of aid. I understand that a large amount of food and fuel went into Gaza last week. What assurances has he had that the flow of aid will continue and will not be stopped by Israel?

[Mr Hague]

My right hon. Friend is right to say that aid is delivered into Gaza. Our message to Israel is that it is important to go further in easing the restrictions on Gaza, including on the movement of commercial goods and persons to and from the Gaza strip. We have not had any assurances about future aid. She raises a very important point. We encourage Israel to do more, rather than less, to ensure that aid is received and that other normal legitimate movements can take place.

[Mr Jack Straw (Blackburn) (Lab)]

The whole House condemns the killing of the three Israelis and the burning of the Palestinian, and none of us has any truck with Hamas. However, for all the vacuous words of the Israeli Government and the Israel defence forces spokesman, is it not clear that they have no regard for international humanitarian law; that they place a completely different and much lower value on Palestinian life than Israeli life; and that the cycle will go on as long as the international community, in an effort to be even-handed, fails to say to the Israelis that the actions that they are taking are completely outwith the United Nations charter and any idea of how a civilised nation ought to behave?

[Mr Hague]

That is why it is important for us to stress the need to observe international humanitarian law, be proportionate and avoid civilian casualties, and work hard on bringing about an agreed ceasefire. I add to what the right hon. Gentleman has said, however. Those who launch waves of rockets from within one of the most densely populated civilian populations in the middle east also bear a heavy responsibility, because they know that any retaliation will severely affect the civilian population. We must bear that in mind as well.

[Alistair Burt (North East Bedfordshire) (Con)]

Israel has an absolute right to defend itself against terror, but with every civilian killed and every child hurt, the method by which Israel seeks to protect its citizens is more questionable, as are the tactics of those who deliberately place children in harm’s way. Will my right hon. Friend commend the excellent article in Haaretz recently by His Highness Prince Turki of Saudi Arabia, which called attention to the need to re-engage the peace process, and praise it not only for who said it but for where it was published? Will my right hon. Friend redouble his efforts to ensure that both Israeli and Palestinian leaders know that the only policy and course of action that has the wholehearted support of this House is urgent and bold steps to recommence the peace process, so that this wretched cycle of pointless violence can come to an end?

[Mr Hague]

As ever, my right hon. Friend goes straight to the point on this important issue. The article he mentions by His Highness Prince Turki helps to demonstrate that in many nations across the middle east—including powerful nations—there is a real appetite for that peace process, and for bringing the cycle of violence that hon. Members across the House are deploring to an end. That should be heard clearly by leaders in Israel and among Palestinians as they make decisions over the coming weeks.

[Glenda Jackson (Hampstead and Kilburn) (Lab)]

It is generally accepted that there can be no military solution to this or any other conflict, and I believe it is accepted by Hamas and Israel that there can be no military solution. The Secretary of State referred my right hon. Friend the Member for Paisley and Renfrewshire South (Mr Alexander) to the role played by Egypt in the past conflict. What pressure is being brought on the new Egyptian Government—if indeed both sides are prepared to listen to what they have to say and will sit around a table with them to end this utterly pointless and scandalous destruction of human life, particularly women and children?

[Mr Hague]

The hon. Lady is right to say that both Hamas and Israel know there is no military solution, and right to point to the important role that Egypt can play. I would not express it as “pressure” on Egypt—Egypt is a sovereign state that will make its own decisions in its own national interest and hopefully the interests of the wider region, but I have discussed this matter with the Foreign Minister of Egypt. The Egyptian Government at the time of the last ceasefire had much closer links with Hamas than the Egyptian Government do today, so the situation is a little different in that regard—[Interruption.] Those on the Opposition Front Bench say that that may be an understatement, and it is a deliberate understatement on my part. It is a different situation, and that is why the role of other Arab states becomes even more important, and that is why we are talking to many of them about the role they can play in bringing about an agreed ceasefire.

[Sir Richard Ottaway (Croydon South) (Con)]

With nearly 1,000 rockets fired at Israel in the last week, no one can deny Israel’s right to defend itself and its citizens. Unlike in the past, however, Hamas looks increasingly isolated in the Arab world, with even Iran failing to declare its support openly. The obvious broker in this is Egypt, but interestingly the Secretary of State just said that he has discussed with other Foreign Ministers the possibility of peace negotiations. Will he say more about those talks and which countries he is talking to?

[Mr Hague]

In my statement I gave something of a list of Foreign Ministers with whom I have discussed this matter over recent hours, including, for instance, those of Jordan and Qatar. I do not want to say more, but I can tell my right hon. Friend that real efforts are going on among Arab states to make progress. However, I do not think it would be helpful for me to set it all out on the Floor of the House.

[Angus Robertson (Moray) (SNP)]

The health system in Gaza is under real pressure given the large number of men, women and children who have been injured, and higher-level more complicated medical support is especially difficult. How is the international community able to help supply those services in Gaza, and will the Foreign Secretary update the House on offers that have been made from outside the middle east—such as that from the Scottish Government—to help provide specialist medical provision from outside the region?

[Mr Hague]

I mentioned in my statement how the funding provided by DFID for several international programmes does help with medical supplies and in taking urgent medical cases out of Gaza. It is very difficult to deliver increased assistance under these circumstances, but every effort will be made to do so if circumstances deteriorate further. Other offers of assistance from all quarters, including of course from Scotland, are greatly appreciated.

[Geoffrey Clifton-Brown (The Cotswolds) (Con)]

My right hon. Friend referred to the fragile situation in the middle east, saying that it is one of the most fragile for many a decade. The United States has key influence with many of the key players, including Israel and Egypt. Will my right hon. Friend redouble his efforts with Secretary Kerry to see what influence we, combined with the US, can have to stop the cycle of violence? This very weak situation could spiral way out of control.

[Mr Hague]

Of course we have to maintain those efforts. I would hesitate to say to Secretary Kerry that he should redouble his efforts, because I cannot imagine how anybody could make a greater effort. He has conducted literally dozens of meetings himself with Israeli and Palestinian leaders in the past 18 months. I know he is determined to continue that work and it is very important that other nations support it. In the European Union in December, we agreed to make an unprecedented package of economic partnership and support available to Israelis and Palestinians if the peace process succeeds. We will continue with that important offer as all efforts to revive the peace process go on.

[Mr Ben Bradshaw (Exeter) (Lab)]

Given that Secretary Kerry and his own middle east Minister have clearly said that it was the Netanyahu regime’s relentless expansion of illegal settlements that bore prime responsibility for the collapse of the Kerry talks, when, instead of this routine language of condemnation of the settlements, can we instead have some real and meaningful action?

[Mr Hague]

We have said that a heavy part of the responsibility lies—not only this; there have been failures on both sides to take full advantage of the opportunities of the peace process—with the illegal settlements on occupied land. We make our condemnation of that, but we have also taken certain actions, including supporting the recent EU statement of guidelines on doing business with settlements. The right hon. Gentleman will be conscious that our prime effort here is to revive and succeed in the peace process. We therefore use language and adjust our pressure to try to do that, and that remains our best hope.

[Martin Horwood (Cheltenham) (LD)]

The Foreign Secretary is absolutely right to call for a permanent end to these intolerable rocket attacks on Israel, but right too that too many Palestinian civilians and children are dying. Will he consider whether the favourable economic and political relationship between Israel and the EU should now be reconsidered in the light of the Israeli Government’s disproportionate response to these attacks?

[Mr Hague]

As I said to the right hon. Member for Exeter (Mr Bradshaw), we have an important difference on settlements. However, our differences throughout the middle east have not led us to economic sanctions or boycotts on any of the parties to the middle east peace process. I do not judge that that would be the best way to advance the peace process now, or in the immediate future. I absolutely understand the hon. Gentleman’s concern, but our effort has to be focused on reviving the peace process.

[Richard Burden (Birmingham, Northfield) (Lab)]

The Foreign Secretary is of course correct that the latest escalation of tit-for-tat rockets and military strikes brings peace no closer; it just brings death and destruction. He may be aware that I, with other hon. Members, was in Gaza just weeks after the 2008-09 Operation Cast Lead. We saw for ourselves that UN humanitarian centres had been hit by Israeli strikes. As he said, 17,000 Palestinian civilians are now sheltering in UN centres, and the UN reports that 49 of those shelters have already been damaged. As a high contracting party to the Geneva convention, what can Britain do about this, and will he confirm that hitting humanitarian centres is a war crime?

[Mr Hague]

What we do about this is to stress to all involved, as I said, that the response must be in line with international humanitarian law and be proportionate and should not target civilians. I say again that the responsibility for civilians being caught up in this is a wide one, including those who decide to launch waves of rockets from heavily populated civilian areas. Of course, that does not absolve Israel of its responsibilities, and we will continue to remind it of its responsibilities.

[Robert Halfon (Harlow) (Con)]

I ask my right hon. Friend to remember that Israel withdrew unilaterally from Gaza and has faced not just 950 missiles in recent months, but 11,000 missiles since the withdrawal. We know, too, that Hamas uses civilians to protect its missiles, whereas Israel uses its missiles to defend its citizens. Does my right hon. Friend agree that the only way to resolve this terrible situation is to take out Hamas from Gaza in the same way as we would deal with other extreme Islamist groups and stop the funding of Hamas by Iran and the supply of long-range missiles from Iran to Hamas?

[Mr Hague]

Many of those things would help greatly, although they are not things that are within our gift to supply. Part of our message to Iran is to stop the funding of extremist, terrorist or sectarian groups throughout the middle east. We hope there will be a change in Iranian foreign policy; we hope that the authority of the Palestinian Authority will be restored in Gaza; and we hope that Hamas will accept the Quartet principles. We are certainly in favour of all those things, but they are, of course, quite difficult to bring about in practice.

[Rushanara Ali (Bethnal Green and Bow) (Lab)]

In 2010, our Prime Minister described Gaza as being like an “open-air prison”, with its people

“living under constant attacks and pressure”.

The latest escalation of the violence and killing has made matters unbearable. When will our Government, working with the international community, actually apply pressure on the Israeli Government to adhere to international law and humanitarian requirements, because this is just completely unacceptable?

[Mr Hague]

As we have all lamented over the last half hour, the situation is unacceptable, but it is important to bear in mind the wider responsibility for that situation. It is very important for us all to give a clear message to Israel about humanitarian law, but it is also important for those launching rockets from Gaza to stop such unacceptable attacks on Israel—that is very important, too, and it is an indispensable component of trying to deal with the situation. Our effort must be directed at the three objectives I set out in my statement: to bring about an urgent and agreed ceasefire, to provide humanitarian relief and to support a revival of the peace process. There is not a better path than that.

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

I unreservedly condemn the rocket attacks on Israel and strongly welcome the Foreign Secretary’s call for a viable and contiguous Palestinian state. What assessment has he made of the possibility of establishing that state, given the settlements that have taken place on occupied territories?

[Mr Hague]

It is still possible to establish such a state. That has been the objective of the work done by the United States, which we have supported and which I mentioned several times, to bring the middle east peace process to success, but the opportunity for that is diminishing as the years and months go by, partly because of the pace of settlement activity on occupied land. Largely because of that, the opportunity is diminishing, and if it is not already, it will soon be the last chance to bring about a two-state solution. That shows the urgency of the situation for Israelis and Palestinians, which adds to the urgency to stop this cycle of violence.

[Fiona O’Donnell (East Lothian) (Lab)]

The greatest threat to Hamas, and the greatest hope for peace, is a sustainable future for Gaza and the eradication of poverty. Does the Secretary of State agree that while the Israeli blockade continues, peace cannot be achieved?

[Mr Hague]

I agree that it is important to ease restrictions on Gaza. The Israeli restrictions on the movement of goods and people do tremendous damage to the economy and the living standards of the people of Gaza, and, in our view, that serves to strengthen, not weaken, Hamas in the long term. An improved economy is essential for the people of Gaza, including the children of Gaza, but it is also ultimately firmly in the security interests of Israel.

[Dr Matthew Offord (Hendon) (Con)]

What assessment has the Foreign Secretary made of reports that Hamas is using Gaza’s largest hospital, Al-Shifa, as a command and control centre to direct rocket attacks?

[Mr Hague]

I do not have specific information about that, but the Israeli Government argue very strongly that civilian facilities are used in Gaza to shield rocket launches and military operations by Hamas, and there is a good deal of credibility in those assertions.

[Jeremy Corbyn (Islington North) (Lab)]

The tragedy of the loss of life in the whole region surely stems ultimately from the occupation of the west bank, the settlement policy, and the current siege of Gaza. What practical steps has the Foreign Secretary taken to criticise Israel for its collective punishment of the people of Gaza, the destruction of water supplies and sewage plants, and the killings of large numbers of civilians, and what sanctions does he now propose to take against Israel for acting against international law in punishing a civilian population?

[Mr Hague]

I go a little further back in my analysis of the root causes, or, as the hon. Gentleman puts it, the ultimate causes, in terms of Israel’s policy. The ultimate cause is the failure to bring about a two-state solution, and there are failings on both sides in that regard. There is the failure to take opportunities in negotiations, and there is the failure by Hamas to adopt peaceful principles that would allow the world to welcome it into negotiations. Those failures exist on both sides, and therefore, for us, it is not a question of sanctions on one side or the other; it is a question of our effort to bring about a viable peace process, and that is where we must continue to place our emphasis.

[Mr Julian Brazier (Canterbury) (Con)]

My right hon. Friend has rightly said that the only foundation for lasting peace and a safe and secure Israel must be a viable and contiguous Palestinian state. Does he agree that there can be no peace until there is an end to the blockade of Gaza in respect of even the most basic economic materials, such as building materials, and withdrawal from the illegal settlements, which prevent any possibility of a contiguous state on the west bank?

[Mr Hague]

Our views on settlements are well known. My hon. Friend is aware of them, and I have reiterated them today As I said in response to earlier questions, we urge Israel to ease its restrictions on Gaza, including restrictions on the movement of commercial goods and persons from the Gaza strip, which only serve to undermine Gaza’s legitimate economy and strengthen Hamas, and we will continue to make that case.

[Lyn Brown (West Ham) (Lab)]

Following the question from the hon. Member for Cheltenham (Martin Horwood)—and while condemning the violence on both sides—I must say to the Foreign Secretary that the right to trade surely comes with the responsibility to uphold basic humanitarian principles. May I urge him to investigate the possibility of a consensus on economic sanctions within the European Union as an effective means of non-violent intervention, delivering Israel to the negotiating table for the desperately needed two-state solution?

[Mr Hague]

I can say honestly to the hon. Lady that there would not be a consensus in the European Union on that. There is a consensus on the statement of guidelines on dealing with settlements that the EU adopted on 26 June, and there is, I am pleased to say, a consensus on the offering of what I described earlier as an unprecedented partnership with Palestinians and Israelis for the European Union—on the offering of that major incentive for the future. On all those things, the European Union is united, but there would not be a consensus on what the hon. Lady has just called for.

[Crispin Blunt (Reigate) (Con)]

When the Minister of State, my right hon. Friend the Member for Faversham and Mid Kent (Hugh Robertson), answered the urgent question two weeks ago following the dreadful murder of the three Israeli teenagers, the Palestinian children death toll due to the conflict had reached 1,406. On Saturday it reached 1,430, including the killing of four toddlers in the course of the last week. Will the Foreign Secretary now say what he has implied: that the Israeli action is disproportionate?

[Mr Hague]

Having been through several of these conflicts, I know there is always pressure in the House, or from others, to adopt totemic words of one sort or another, but I feel our diplomatic effort has to be directed at the things I have described—bringing about an urgent and agreed ceasefire, giving humanitarian relief, supporting the revival of the peace process—while calling for proportionate actions all round, and that is what we will continue to do.

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

Mr Speaker, I had to dash out to the Committees on Arms Export Controls to make a quorum, but I am now back. I was here at the beginning.

[Mr Speaker]

Order. I applaud the hon. Gentleman’s candour. I rarely fail to notice his movements, but I had not noticed that he toddled out and beetled back, but we can always do with a bit of information.

[Mike Gapes]

The Foreign Secretary has referred to the role of Egypt on a number of occasions. It is reported today that Hamas has said it does not wish to have the Egyptian Government as a mediator, and at the same time seven civilians and one military person were killed in Sinai from fire that was apparently coming from Gaza, or near to it. What does he think can be done to improve the relationships in that part of this area, so the Egyptians can play a positive role in this process to get a solution?

[Mr Hague]

The hon. Gentleman is right to point to those difficult relations, and I made the point earlier—I do not know whether that was during his unnoticed absence—that Hamas’s relations with this Egyptian Government are nothing like as warm, to put it mildly, as with the previous Egyptian Government at the time of the last Gaza conflict. That means there is a less natural role for Egypt in bringing about a ceasefire, as its influence on Hamas is less. Nevertheless it is important to find ways of working with Gaza, including easing humanitarian access through the Rafah crossing, and I hope that Egypt, which is the major Arab nation in the region, will use its full weight to try to bring about a ceasefire agreed on all sides.

[Sir Edward Leigh (Gainsborough) (Con)]

Can the Foreign Secretary give us a bit more insight into the thinking of his Israeli counterparts? While we all accept the need for Israel to defend and deter, when he talks to the Israeli Foreign Minister does he get any sense that it must be more difficult for Israel to defend and deter if it is holding an entire people in the largest prison camp in the world in appalling conditions? Does he get any impression that common humanity calls out for peace and justice for the Palestinian people?

[Mr Hague]

Israeli Ministers stress their need to defend themselves against rocket attacks and say any nation in the world facing a barrage of rockets on its major cities would mount a military response. It is, of course, always important to look beyond that, as we are in all our comments across the House today, and to ask how we can break this cycle of violence in the long term, and that means a two-state solution and a viable sovereign state for Palestinians, which is why we have to continue to work for that.

[Mr Andy Slaughter (Hammersmith) (Lab)]

We should not equate the occupied with the occupier. We should not equate a refugee population of 1.7 million imprisoned in a tiny strip of land with the prison guards. We should not equate terrorists firing rockets with a supposedly civilised state systematically killing women and children and elderly and disabled people. Will the Secretary of State accept that if his and other western Governments fail to discriminate between the actions of Hamas and Israel, hundreds of Palestinian civilians will continue to die and the annexation of Palestine by Israel will continue?

[Mr Hague]

I do not see it as a matter of discrimination or failure to discriminate. I think we all agree across the House that there is in the end only one solution to this—not the military solution, but a successful peace process as the shadow Foreign Secretary and others have said. The hon. Gentleman is right to point to the responsibilities of occupiers; the responsibilities of all civilised and democratic states. But we do have to point also to the responsibilities, as I did earlier, of anyone who chooses to launch hundreds of rockets from a densely populated area. They have responsibilities, too.

[Steve Baker (Wycombe) (Con)]

Large numbers of my constituents have expressed the view that the people of Gaza are suffering collective punishment. But is it the deliberate policy of Hamas to put those same people in harm’s way?

[Mr Hague]

There is a good argument for that, and one of our hon. Friends who has now left the Chamber gave an alleged instance of this earlier. The Israeli Government argue that Hamas in effect uses civilians as shields—that one of the reasons for civilian casualties is that rockets are launched deliberately from within heavily populated areas, Gaza itself being a very densely populated area. It is in the nature of the conflict that that happens and that civilians are therefore in the front line, and Hamas bears responsibility for that.

[Seema Malhotra (Feltham and Heston) (Lab/Co-op)]

No Member of the House can fail to be horrified by the escalation of violence on both sides and by what appears to be the disproportionate response of Israel. More than 200 of my constituents have written to me to ask me to ask the Foreign Secretary what action he has taken to help to secure a ceasefire and, to echo the words of the right hon. Member for Mid Sussex (Sir Nicholas Soames) and my right hon. Friend the Member for Exeter (Mr Bradshaw), what action he will take to help end illegal settlement and to help to continue the economic development in Palestine.

[Mr Hague]

I will not repeat everything I said in my earlier statement, but I hope that the hon. Lady will send to her constituents what I said about everything that the UK has done in recent days to promote a ceasefire—the work we have been doing at the UN Security Council and in the discussions I have had with Israeli and Palestinian leaders and many Arab nations to help bring about an agreed ceasefire. I also gave examples in my statement of what we are doing to help the economic development and state-building of Palestinians. The UK is one of the largest donors in the world to that, and we will continue that effort.

[Andrew Stephenson (Pendle) (Con)]

The Secretary of State is right to say that one of the only ways to break the cycle of violence is to improve conditions in Gaza, where many of the people whom I represent feel that civilians—women and children—are being collectively punished, and certainly are bearing the heaviest price of the terrorist acts committed by Hamas. What more can we do to end the Israeli blockade of Gaza and improve the general condition of people living there?

[Mr Hague]

This is likely to require a more peaceful situation and a much better atmosphere than the one that prevails now. But in any such atmosphere, we will continue to advocate that Israel should ease restrictions on Gaza, including on the movement of commercial goods. I listed what we have done in terms of humanitarian relief and said that the Department for International Development stands ready to do more. The UK will remain in the forefront of providing humanitarian relief to the Palestinian people.

[Mr Khalid Mahmood (Birmingham, Perry Barr) (Lab)]

If I wholly and unreservedly condemn attacks by Hamas, will the right hon. Gentleman wholly and unreservedly condemn the excessive force used by the Israeli Government in targeting residential areas in Gaza, resulting in the indiscriminate killing of civilians—women, men and young children—which is clearly a grave breach of the Geneva convention, while we wait for the middle east process to kick off?

[Mr Hague]

It is important for all of us, on all sides of the argument—I think there is a strong consensus here on the need for a peace process and to break this cycle of violence—to deplore violence and the murder of innocent civilians on all sides. That is what I have done in my statement. That is the clear sentiment, of course, across the House. We want to see a situation where Israel is not subject to rocket attacks from Gaza and Palestinians in Gaza are not subject to Israeli airstrikes in retaliation. That is what we are trying to bring about.

[Mr Mark Harper (Forest of Dean) (Con)]

I am listening carefully to the Foreign Secretary, but sometimes I reflect that if we in this country were subject to the same rocket barrage as the Israelis, we would hear many voices urging swift retaliation. Given that and given the difficulty that any Israeli Government would face in not responding to such attacks, will the Foreign Secretary say a little more about what he is doing with neighbouring states to put pressure on Hamas to stop the rocket attacks on Israel so that we can move towards restarting the peace process?

[Mr Hague]

My hon. Friend is right that any nation faced with this situation would respond to such rocket attacks and would be under immense pressure to do so from its own domestic population. It is important for Hamas to feel the pressure to stop such attacks. That happened after the previous two conflicts, and we saw a ceasefire. It is important that that happens again. I have mentioned the conversations that I have had with Egypt, Jordan and some of the Gulf states about this, so there is Arab pressure and Arab engagement with Hamas to try to bring this to an end. The UK will continue to support that process behind the scenes.

[Fiona Mactaggart (Slough) (Lab)]

I agree with the Foreign Secretary that what is needed is a ceasefire to provide relief to the people of Gaza and to restart the peace process. But is it not too late? In all the 17 years I have been in this House, progress towards a two-state solution has been in reverse. Just last year, the UN predicted that potable water in Gaza would run out by 2016. Palestinian officials are reporting that the Israelis are targeting water and sewerage systems. Before this latest attack, the people of Gaza were spending 30p out of every pound on safe drinking water. How will we ensure that they can live while we carry on this argument?

[Mr Hague]

The hon. Lady asks a very good question on water and sanitation. I think that I pointed out in my statement that some of the aid that we supply through DFID and international agencies is absolutely to help with that, because there are several hundred thousand people without adequate water and sanitation. She is also right that the cycles of violence in Gaza are getting worse. Each one seems to be worse than the preceding one in terms of the devastation that is brought about, the range of rockets that are fired from Gaza into Israel, and the intensity of the Israeli retaliation. The warning is clear to all those involved that without a viable peace process, this cycle of violence will only get worse in the years ahead. That is what we want them to remember whenever a ceasefire is agreed in this conflict.

[Henry Smith (Crawley) (Con)]

Like many Members, I have been contacted by a large number of constituents who are deeply concerned about the security situation in Gaza. On behalf of them, may I ask the Foreign Secretary to continue to press all those involved to ensure that they find a peaceful solution through the US-led process?

[Mr Hague]

Yes, I know that there is very strong feeling, and great anxiety, among many people in this country. We will certainly continue those efforts through this US-led process. We will also do our best, through our humanitarian assistance, to relieve the suffering of many people in every way we can.

[Ms Karen Buck (Westminster North) (Lab)]

With half of the population in Gaza aged under 18 locked in an open prison in one of the most densely urban concentrations in the world, there was never any prospect that children would not be the disproportionate victims of this military action. Now we see tens of thousands of homes without electricity and a rapid deterioration of the humanitarian situation. What urgent representations can the Foreign Secretary make now to ensure that while we wait for the ceasefire, which will inevitably come, we do not see a further worsening of a catastrophic humanitarian situation?

[Mr Hague]

Those are the urgent representations that we are making, including all the ones I have been making over this weekend. The hon. Lady is right to refer to the loss of electricity. However, it seems that 70,000 homes in Gaza lost electricity because of a rocket fired from within Gaza that brought down a power line coming from Israel. So such power loss can be brought about by fire from both sides. We must bear that in mind, but, of course, our urgent representations will go on.

[Mr Philip Hollobone (Kettering) (Con)]

The tragedy of Gaza is that, following the Israeli withdrawal in 2005, the Palestinians had a golden opportunity to create a model of how a Palestinian state would be run to give the Israelis the confidence ultimately to withdraw from the west bank. Instead, however, Hamas took over from Fatah and decided to spend all its money not on vital infrastructure but on building up an arsenal of 11,000 rockets. Where did those rockets come from to get into the Gaza strip? Is my right hon. Friend confident that the Egyptians have closed down the tunnels, the tolls from which fund Hamas in all its criminal activity in the Gaza strip?

[Mr Hague]

My hon. Friend makes a telling point. The history of the past nine years would be different had Hamas or any other Palestinian leaders in Gaza been able to take it in a different direction. However, I have also reiterated today the many criticisms that have been made of Israeli policy. The rockets or their components have clearly been smuggled in, probably largely through such tunnels. Egypt has closed many of the tunnels, which is one thing that has put Hamas under more pressure in recent months, but Hamas has to see that it is pointless to continue with this cycle of violence.

[Shabana Mahmood (Birmingham, Ladywood) (Lab)]

We have had several contributions about the proportionality of Israel’s military response, but we are ultimately discussing innocent people and children dying. With that in mind, at what point does the Foreign Secretary think that we should move from a proportionate to a disproportionate response? Surely the current death toll in Gaza is the clearest sign of a disproportionate and indiscriminate response. Will he declare it as such?

[Mr Hague]

The tragedy is that there are innocent civilians on all sides. People are suffering terribly in Gaza, but the 5 million Israelis who live within rocket range and are running for their underground shelters every few hours are also innocent civilians. Our emphasis must therefore be on doing the things that I have described: promoting a ceasefire; providing humanitarian relief; and reviving the peace process. Those are three clear planks of our policy and I am sure that they are right.

[Mr Rob Wilson (Reading East) (Con)]

I agree with the Foreign Secretary that there is fault on both sides of the argument, and I know that he is doing all that he can to create the conditions for a ceasefire. Does he agree that peace will be possible only if conditions in Gaza, which, incidentally, are appalling, are improved? What more can the UK do to help ordinary Palestinians, who suffer such intolerable conditions even when no military conflict is taking place?

[Mr Hague]

That is an important point. I pointed out earlier that we are providing £349 million of assistance to the United Nations Relief and Works Agency for Palestine Refugees in the Near East, to which we are the world’s third biggest donor. Some of that assistance is going into Gaza, but more will be necessary in these circumstances. We are also looking to Israel to ease restrictions on Gaza, because conditions for the people, as my hon. Friend rightly says, are an important component of future peace.

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

The Foreign Secretary has already acknowledged the importance of access to water and sanitation. What assessment has he therefore made of reports that Israeli aircraft have been targeting water wells? If they have, that is a clear breach of international law.

[Mr Hague]

The hon. Lady will appreciate that we do not at the moment have enough detailed information to be able to assess that ourselves. Those accusations are made against Israel. Equally, as I have mentioned, Israelis allege that Hamas stations military headquarters, facilities or weapons in the proximity of civilian infrastructure and homes. Accusations are made on both sides and we cannot conclusively distinguish between them, which is why we must concentrate on what I have set out.

[Sir Bob Russell (Colchester) (LD)]

Will the Foreign Secretary confirm that the actions of Israeli political and military leaders constitute war crimes?

[Mr Hague]

I think that that relates to the question that I have just answered from the hon. Member for Kilmarnock and Loudoun (Cathy Jamieson), in that it is not possible for us at this distance and without a presence on the ground to assess every single thing that happens within Gaza. Strong accusations are made about the targeting of civilian areas and Israelis make counter-accusations that military infrastructure is positioned in those civilian areas, so rather than try to judge things from London it is important for us to concentrate on bringing about an agreed ceasefire.

[Angela Smith (Penistone and Stocksbridge) (Lab)]

The Foreign Secretary has quite rightly drawn attention to the role of the international community in securing a ceasefire, but can he give his assessment of how likely it is that we will get a cessation of violence in the days ahead?

[Mr Hague]

We must guard against any excessive optimism, because the situation is dire. Nevertheless, in previous such conflicts there has been recognition after some days, as others have said, that there is no military solution and that there is a need for a ceasefire on both sides. I hope that that recognition is there and that the efforts to promote it, which are going on now, will fall on receptive ears on both sides.

[Michael Fabricant (Lichfield) (Con)]

On these occasions—sadly, there are too many of them—the House becomes polarised, so I commend my right hon. Friend for his balanced responses. He will be aware that after the last ceasefire in 2013, 74 rockets and mortars were fired, quite routinely, into Israel and in the first six months of this year, before the kidnapping of the three young Israelis, 133 rockets were fired into Israel. What hope does he have that after the inevitable ceasefire this time round we will not meet again in two years’ time in similar circumstances?

[Mr Hague]

My hon. Friend is quite right about that and that was why I was saying earlier that the cycle of violence has got worse. He is right that, even between ceasefires, a large number of rockets have been launched against Israel, although usually in between ceasefires they have been launched by other groups and not necessarily by Hamas. What distinguishes a period such as this one is that Hamas is engaged in large-scale rocket fire against Israel, which it could control and prevent. He is right to sound a cautionary note about what will happen after any ceasefire and that further intensifies the message that reviving the peace process is very important.

[Barry Gardiner (Brent North) (Lab)]

Israel’s right to defend itself, of which the Foreign Secretary speaks, is not an unconstrained right, yet Israel’s response has been unconstrained. It has been disproportionate and wrong. Heavy bombing in a densely populated area with 100,000 civilians, causing the death of 170 people, a third of them children, is not self-defence; it is barbarism. What leverage does the Foreign Secretary have and will he now apply it to make the Israeli Government reappraise this barbaric and unproductive strategy?

[Mr Hague]

My hon. Friend the Member for Lichfield (Michael Fabricant) spoke about the polarising aspects of this issue and there are passionate feelings about this and about what is happening to people in Gaza. As I said earlier, we must also remember that many hundreds of rockets have been launched indiscriminately against people living in Israel, and rather than refining our value judgments each day, are concentrating on bringing about an agreed ceasefire and urging all sides to abide by international humanitarian law. I think that that is the right thing to continue to do.

[Debbie Abrahams (Oldham East and Saddleworth) (Lab)]

Mona El-Farra, a doctor working on the Gaza strip, has described in graphic detail the pain and damage caused to civilians in this collective punishment of Palestinian people. I agree with Members on both sides of the House that in the long term we need to tackle the underlying issues with blockades, access to justice and the settlements, but in the short term, what additional pressure can we place on the Israeli Government—particularly as regards the disproportionate and indiscriminate action that they are taking on the people of Gaza—and on Hamas? Will the Foreign Secretary reassure all Members of the House that the tone of today’s statement and the comments being made are being conveyed to them?

[Mr Hague]

Absolutely, and the tone that I have taken today, which I think, judging by the reaction, is shared widely across the House, is exactly the tone of our discussions with Palestinian and Israeli leaders and with others in the region over the past few days. The pressure really takes that form of trying to find the formula for the ceasefire, which other nations are involved in and which we have supported at the UN Security Council—it is diplomatic pressure that is most likely to succeed and has succeeded previously—and then we have to resume the search, as the hon. Lady rightly says, to resolve the underlying causes of the conflict.

[Kevin Brennan (Cardiff West) (Lab)]

The Foreign Secretary has rightly condemned the rocket attacks by Hamas, but does he understand that his unwillingness to condemn as disproportionate the current response by the Israeli Government feeds into a view held by many of our constituents that the lives of Palestinians are not valued as highly as the lives of Israelis in this conflict and does very little to put additional pressure on the Government of Israel to act in a proportionate way when it is under attack?

[Mr Hague]

I can assure the hon. Gentleman and the constituents of all those in this House that we are clear about the equal value of lives all over the world; that applies to Israelis and Palestinians as well. I think our efforts have to be geared to trying to achieve what I set out in the statement, and I do not think it would be helpful to refine our judgment each day about the tactics of each side. We need to bring about an agreed ceasefire, and the diplomatic processes we are engaged in are the best way to do that. That is the best way to save all lives, including Palestinian lives. I do not judge that any other way of doing that would be more effective.

[Mr Liam Byrne (Birmingham, Hodge Hill) (Lab)]

The air strikes, the commando raids and the rocket attacks have got to stop before any more children are killed, but may I press the Foreign Secretary on resolution 1860, on which Britain led back in 2009 and which stated that justice required

“sustained and regular flow of goods and people through…crossings”.

Does the Foreign Secretary not agree that without progress restoring the normality of trade, jobs and growth, we risk trapping the Palestinian people in a cycle of not only violence but despair from which there is no escape?

[Mr Hague]

Yes, I agree. That was an important resolution, and with our EU partners and the office of the Quartet we will continue to press the Israeli Government at ministerial and official levels to ease the restrictions on Gaza. This is an argument that we have never won—that no British Government have won—with Israel, but we will continue to make it. Israeli restrictions on movements of goods and people do tremendous damage to the economy in Gaza and to the long-term prospects for peace.

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

The bleak situation facing the middle east so adequately reflected in today’s exchanges calls for an enhanced role for the United Nations Secretary-General, at least in the context of de-escalation and achieving a ceasefire—it may be that other parties would want to carry the peace process forward. Does the Foreign Secretary agree with that summation that there is a role for the UN Secretary-General, and will he support that at the Security Council and in other forums?

[Mr Hague]

Yes I do. The UN Secretary-General has made clear statements about the need for bold choices on both sides, and the Security Council agreed a statement on Saturday calling for an agreed ceasefire. The UN Secretary-General has to judge what he can achieve in any conflict in the world, but this is certainly an area where we support a strong role for him, as well as for the work of others behind the scenes in trying to lay the groundwork for an agreed ceasefire by both sides.

[Jonathan Ashworth (Leicester South) (Lab)]

Like all Members I condemn the rocket attacks, but like many Members I consider the bombings and aggression that have led to the loss of many innocent children’s lives, damage to schools and destruction of homes to be disproportionate—indeed, many of my constituents feel that they amount to collective punishment. I am sure the Foreign Secretary agrees that there is an urgent need for increased humanitarian assistance. The United Nations Relief and Works Agency thinks that there is a shortfall in its emergency appeal. What representations can the right hon. Gentleman make to his counterparts to ensure that UNRWA has all the resources it needs?

[Mr Hague]

My ministerial colleagues from the Department for International Development were here earlier, and of course I will update them on all other comments made in the House. The scale of our support through DFID for UNRWA will continue, and DFID stands ready to increase that support, as I made clear in my statement, so if the situation continues to worsen, we will intensify our efforts to get humanitarian supplies through to the people of Gaza.

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

I add my voice to those of all the Members who have unreservedly condemned the violence in all the forms it takes in this tragedy. Looking towards the ceasefire, which cannot come quickly enough, will the Foreign Secretary please tell the House what support the British, the EU and the UN will give to projects that foster co-operation and co-existence between Palestinians and Israelis, to build that capacity for a new generation of leaders who are committed to dialogue, peace and the two-state solution?

[Mr Hague]

This is a very important point. The hon. Gentleman will know that our embassy in Tel Aviv and our consulate-general in Jerusalem support such projects, with the encouragement of Members of Parliament on all sides. They are often difficult to bring about because of such a tense and acrimonious situation, but we will continue to do that and we will look at how we can broaden such work in the future.

[Nia Griffith (Llanelli) (Lab)]

We understand the immediate need for a ceasefire and for humanitarian aid, but we must look at the underlying causes, with Gaza under siege and 60% of the west bank now under direct military rule and a seemingly complete failure to halt the continuing expansion of the Israeli settlements. The Foreign Secretary has mentioned how difficult it is to influence Israel in the treatment of Gaza, but those settlements in the west bank are illegal, so surely more could be done there. Can he explain what more could be done to put pressure on Israel in order to deal with the way that it is behaving and therefore to bring forward the peace process?

[Mr Hague]

This, too, is a very important point. Illegal settlements on occupied land are a major obstacle to peace. We believe they should stop. We have our own guidelines on settlement produce in this country, as the hon. Lady knows. We have recently agreed across the European Union a common statement of guidelines on doing business with settlements. This reflects increased international pressure, but of course the ultimate answer to the issue of settlements is a two-state solution; it is to resolve the final status issues. That is the only way in which the issue of settlements will be resolved in the end, and that is why the work led by Secretary Kerry on this is so important.

bill presented

Data Retention and Investigatory Powers Bill

Presentation and First Reading (Standing Order No. 57)

Secretary Theresa May, supported by the Prime Minister, the Deputy Prime Minister, Secretary William Hague, Secretary Philip Hammond, Secretary Theresa Villiers, Danny Alexander and James Brokenshire presented a Bill to make provision, in consequence of a declaration of invalidity made by the Court of Justice of the European Union in relation to directive 2006/24/EC, about the retention of certain communications data; to amend the grounds for issuing interception warrants, or granting or giving certain authorisations or notices, under part 1 of the Regulation of Investigatory Powers Act 2000; to make provision about the extra-territorial application of that part and about the meaning of “telecommunications service” for the purposes of that Act; and for connected purposes.

Bill read the First time; to be read a Second time tomorrow, and to be printed (Bill 73) with explanatory notes (Bill 73-EN).

[Chris Bryant (Rhondda) (Lab)]

On a point of order, Mr Speaker. In relation to the Bill which has just had its First Reading, if all the motions on the Order Paper today and tomorrow are agreed, the vote on Second Reading will take place in 24 hours and six minutes. If the motion is carried later tonight, we will not be able to table any amendments to the Bill until late tonight. Can you clarify whether you will therefore allow manuscript amendments to be considered tomorrow afternoon?

[Mr Speaker]

Yes. My purpose is to seek to facilitate the House, not to be an obstacle to effective scrutiny. In the circumstances which the hon. Gentleman has pithily summarised, I do not think the normal rules of engagement apply. The House is being confronted, for better or for worse, rightly or wrongly, with a particular arrangement which places very great demands on Members, so yes, I will be very open to the receipt of manuscript amendments. I hope that that assuages the hon. Gentleman’s concerns.

Childcare Payments Bill

Monday 14th July 2014 Commons Chamber

Second Reading

16:54

[The Financial Secretary to the Treasury (Nicky Morgan)]

I beg to move, That the Bill be now read a Second time.

Hon. Members will be aware that, as we sit in the Chamber this afternoon, not only is overall employment in the United Kingdom at record levels, but female participation in the work force is at an all-time high. That means that across the country more people than ever before have jobs to wake up for at the start of the day, and pay cheques to take home at the end of the month. That is something that this Government can be proud of having helped to achieve.

However, we are by no means complacent, and we know that we can do more to remove the barriers that still prevent people who want to go to work from being able to do so. That is where the Bill comes in. Tax-free child care will be a simple scheme that is responsive to the needs of working families, whatever their work arrangements. The Bill will provide greater support to parents and, in turn, open up greater opportunities for them.

I would like to use my time at the Dispatch Box this afternoon, first, to remind Members why we are introducing these changes; secondly, to talk through exactly what form these changes will take; and finally, to explain how the changes will differ from, and improve on, the employer-supported child care scheme currently in place.

[Hywel Williams (Arfon) (PC)]

I am grateful to the Minister for giving way so early in her speech. I am concerned that the Bill does nothing about the supply of child care, particularly in rural and disadvantaged areas. How confident is she that the measures she proposes will indirectly stimulate greater provision?

[Nicky Morgan]

I thank the hon. Gentleman for that point. As I am sure he will be aware, my colleagues in the Department for Education, and particularly the Under-Secretary of State, my hon. Friend the Member for South West Norfolk (Elizabeth Truss), have been working to encourage the provision of more places, including by providing £500 to enable child minders to set up new businesses, and through schools and a wide variety of places. He is absolutely right that in order to tackle the issues of child care, we need to think about not only the costs but the supply side. We are confident that there will be places available for all the families who want them.

Let me turn first to the “why”. As hon. Members will know very well—many from their own experiences—every year millions of families across the country are faced with a difficult decision: whether it makes greater financial sense to stay at home and manage child care themselves or to go to work and arrange for someone else to do it.

[Neil Parish (Tiverton and Honiton) (Con)]

I very much welcome the Government’s approach to tax-free child care, especially for the self-employed. In the past they have been ruled out of help, so the sooner we can put that right, the better.

[Nicky Morgan]

My hon. Friend is entirely right. I will move on to talk about the importance of the scheme for the self-employed and for those setting up or growing their own businesses. I am very pleased that he has raised that at this stage in the debate.

[Charlie Elphicke (Dover) (Con)]

This measure will be welcomed by my constituents in Dover and Deal who work hard but do not get paid a lot of money. How many working families with children will benefit from this important measure?

[Nicky Morgan]

I am grateful to my hon. Friend for that question. Some 1.9 million working families will have access to the scheme. Of those, 1.25 million will have qualifying child care costs and will benefit under the scheme. As I will explain, more families will benefit under this new scheme than currently benefit from employer-supported child care vouchers.

Of course, for some families there is no choice about who should look after the children, because the parent or parents have to go to work, and must therefore arrange child care. It is worth reminding Members that the research shows that this issue has had, and continues to have, a disproportionate impact on women. The Women’s Business Council, which has done an excellent job in its first year in drawing attention to the barriers women face and suggesting changes to help remove them, has frequently pointed to the way in which child care costs can have an undue impact on women’s careers. Recent survey data from the Department for Education show that more than half of mothers in the United Kingdom who are not in paid work would prefer to be in paid work if they could arrange reliable, convenient, affordable and good-quality child care.

We need to think about what is at stake, not just for the mothers whose careers are held back, and not just for the many fathers who are primary carers and experience the same problems, but for our economy. If we can equalise the labour force participation rates of men and women, the United Kingdom can further increase growth by 0.5% per year. That will be a huge change which could make a real difference to our families and our economy.

Hon. Members will know that the Government have already taken action on this matter. We have funded 15 hours a week of free child care for all three and four-year-olds, which is available to all families, including those where a parent is not working. We have funded 15 hours a week of free child care for the 20% of two-year-olds who are most disadvantaged. From this September, we are extending that offer to about 40% of two-year-olds.

[Jonathan Ashworth (Leicester South) (Lab)]

I apologise for the fact that I am going to have to leave to pick up my own children from child care. Will the Minister confirm that a lot of parents who need access to child care help need it now, and that it was a mistake on the part of the Government, back in 2011, to reduce the child care support that was available when they made cuts to working tax credit?

[Nicky Morgan]

I entirely agree that families need support now. I have been setting out exactly what we have done in extending to 15 hours a week the free child care available for all three and four-year-olds, as well as for disadvantaged two-year-olds. On working tax credit, let me point out that the Government are spending £1.1 billion on the child care element of tax credits each year, so many families are still, rightly, receiving a huge amount of support through the tax credit system. We are proposing an enhancement of the child care offer that we already have.

We are taking action to drive up the supply of high-quality child care provision by legislating for childminder agencies, encouraging primary schools to open for longer, and reducing bureaucracy and red tape for providers—all steps that should help to drive supply up and costs down.

The Bill represents a further step towards helping hard-working families. We are committed to launching the scheme next autumn and rolling it out to all eligible families with children under 12 within the first year of its operation.

[Ms Margaret Ritchie (South Down) (SDLP)]

There is a concern that while single parents can access the new system, families with one parent in work and one not in work would not be entitled to anything. What can be done to assist people in such circumstances? From a Northern Ireland perspective, I know that there will be a legislative consent motion to deal with this legislation, but what advice can the Minister give now, in advance of such an LCM and in advance of the Bill’s implementation?

[Nicky Morgan]

I thank the hon. Lady for making that point, which is certainly of interest to everybody concerned with the issue of child care and who should look after children. I want to be very clear that this is about a choice, for those families who can afford it, in that they can decide that one parent will not be working, at least for a certain period. Of course, however, some families do not have that choice, with both parents needing to work, and there are lone parents who will need to work. For families where one parent is not working, we have introduced the married couples tax allowance, which has been legislated for in the Finance Bill, and those families will be receiving a tax benefit of just over £200 a year. This proposal is very much about enabling parents to play a full part in the labour market. That is why we have brought this Bill forward at this time.

[Ms Ritchie]

I am looking at this issue in a Northern Ireland context, and I am sure that there are many regions in Britain with similar circumstances. What happens if the other partner cannot access full-time or even part-time occupations, which is a reality for many families throughout the UK?

[Nicky Morgan]

Employment levels have gone up substantially under this Government. More people are getting jobs and more hours. As I say, the Bill is about a choice. With more people securing employment, this is about enabling families to make a choice if both parents need to or want to work, or, in the case of lone-parent families, providing support that is more generous than the current employer-supported child care voucher scheme.

The scheme, which launches next autumn, is to be rolled out to all those eligible families with children under 12 within the first year of its operation. The real triumph of the scheme is that it will make hundreds of thousands of parents who are currently excluded from support eligible for it.

The scheme has been designed so that support is available to the self-employed, who play a crucial role in our economy but are currently excluded, and so that it suits the needs of part-time workers, who are very often parents staggering their way back into full-time work, and those parents who are temporarily absent from the workplace—for example, during statutory parental leave. It is also designed to support those couples where one member is in work and the other is in receipt of carer’s allowance or employment and support allowance, by making them eligible for the new scheme.

[Barbara Keeley (Worsley and Eccles South) (Lab)]

The Minister is reading out a list, but on the question of future roll-out, Opposition Members are very concerned about universal credit, the future of which we spent much time discussing in the Chamber last week. When will additional support be made available for those low-income families, who deserve help with the costs of child care? Is it really the case that 4 million low-income families could be waiting until 2017, and why is there still so much uncertainty around funding this part of the programme for universal credit?

[Nicky Morgan]

I do not think there is uncertainty around that, but there is uncertainty among Opposition Members and I find it staggering that they are criticising and querying universal credit when it is absolutely needed. I think that all Government Members and most people in the Chamber will agree with that. From April 2016, working families will be able to recover 85% of their actual child care costs under universal credit.

[Barbara Keeley]

Where will that be funded from, because there is also a lack of clarity about how it will be funded?

[Nicky Morgan]

I do not think there is a lack of clarity. We have published regulations today and there will be further debate during the Bill’s Committee stage, so may I suggest—[Interruption.] More information and plenty of guidance will be made available to families who might move from universal credit to tax-free child care and to those who might have to move back again. That will be available online and there will be a provision to enable people to get guidance from Her Majesty’s Revenue and Customs as to which scheme is most suitable for them.

[Barbara Keeley]

rose—

[Nicky Morgan]

I am not going to give way again. The point is that, under universal credit, families will get support for 85% of their child care costs. In short, this is a system that recognises and adapts to the complexities of modern working patterns. It also goes a long way towards providing the simplicity sought by many parents.

Someone with a screaming child in one arm and a BlackBerry with a screaming boss on the end of it in the other hand does not want to spend their time negotiating a complex and rigid child care scheme. We have therefore been working incredibly hard to ensure that the scheme will be simple, responsive and flexible. It will be easy for parents to register and open a child care account and to access the scheme through online portals. It will be flexible to the changing demands of child care they face. It will allow them to pay in money when they want to, and it will also allow other people to pay in, such as grandparents or an employer. In many cases, it may well be a family member who is keen to support the child’s upbringing. The scheme will also allow parents to spend money on qualifying child care at a time of their choosing, by allowing them to use their vouchers on, for example, summer holiday clubs, not just during the school term.

[Hywel Williams]

The service will be provided online. How confident is the Minister that parents in rural areas such as mine, where broadband is either very slow or non-existent, will not be disadvantaged?

[Nicky Morgan]

That is why this Government are providing a huge amount of money—more was announced last week—to enable communities to get online, including broadband. Many families are already able to access services online and via broadband. Rather than look for problems, it would be helpful if everyone in this House went out and sold the scheme to families, so as to enable them to register and make it a reality.

[Hywel Williams]

rose—

[Nicky Morgan]

I want to make some progress.

On flexibility, parents and families will be able to build up balances in their accounts, to meet the cost pressures of expensive times of the year. The scheme will also provide rigidity where parents need it. Once eligible for the scheme, parents can rest assured that they will continue to be entitled to support for three months, regardless of any changes in circumstances they may experience.

Hon. Members with further questions about the scheme’s practicalities may wish to note that we have today published the draft regulations for consultation. They contain the detailed rules concerning eligibility for the scheme—for example, what qualifying paid work means—and its operation, such as how and when a declaration of eligibility might be made.

[Bridget Phillipson (Houghton and Sunderland South) (Lab)]

In relation to the transparency of the regulations and the clarity of the scheme, will the Treasury publish a distributional analysis so that we can understand how families will benefit? How much will the average family benefit per year from the new scheme?

[Nicky Morgan]

We already have figures showing that for the 1 million families who will gain from the introduction of the scheme, the average additional support will be £600 a year. Obviously, the Government top-up very much depends on how much families put into the accounts for themselves. For example, a working single parent with one child who has child care costs of £5,000 will receive £1,000 of support from the scheme. I will certainly take away the hon. Lady’s suggestion, but the figures are already fairly clear. The level depends on families’ contributions, which will then be matched by the Government.

As hon. Members will be aware, when the tax-free child care scheme is introduced, employer-supported child care will be closed to new entrants. Parents who already receive support through that scheme can continue to receive it in exactly the same way as long as they continue to work for their current employer and the employer continues to offer the scheme. Workplace nurseries will not be affected by the changes.

Those who favour the current arrangements need to remember that under the present system less than 5% of employers offer employer-supported child care, leaving more than half of all employees—as well as all self-employed parents, and most employees on the minimum wage—without support. In contrast, tax-free child care will be available to all working families provided that they meet the eligibility criteria. As such, we expect the scheme to be open to at least twice as many families as the current one.

We expect the new scheme to be much fairer. One of the main failings of existing employer-supported child care is that it disadvantages lone parents by providing twice as much support to couples in which both partners work for employers offering the scheme than it does to single parents. To be completely frank, that does not seem right, so the Bill addresses that unfairness. It will ensure that the level of support provided is determined not by the number of parents in work, but by the number of children in the household. That means that for a family with two children, the maximum level of child care costs supported by tax-free child care will be three times the maximum level supported by employer-supported child care.

It is worth reminding the House that the existing scheme is an inefficient one. At present, employers receive a national insurance contributions disregard of up to 13.8% for operating an employer-supported child care scheme, despite the fact that it generally costs them significantly less than that to run their scheme. We should remember that that taxpayer money is not actually spent on child care support. There will therefore be no employer’s national insurance contributions breaks in tax-free child care once the new scheme becomes available.

We know that many employers value the role they can play in supporting their employees, including by helping them with their child care costs. We hope that such employers will continue to take an active, voluntary role in the new scheme. In fact, many have told us that they intend to do so. Although it may disappoint some hon. Members that the Government have no intention of making any form of employer role mandatory, they should remember that that is because we want to minimise the burdens on small businesses. We also want to maximise the scheme’s fairness so that it is the same whether people are self-employed, employed by a small shop or employed by a huge multinational.

We want to increase the support available to hard-working families with their child care costs as soon as possible. We especially need to support the women of the United Kingdom, who are disproportionately impacted by the complexity and unfairness of the current child care arrangements. The more women we can help back to work—if they want and need to work—then the more people we can get back to work, the more we can drive growth in our economy, the more we can reduce some of the inequalities that still blight our workplaces and the more we can raise the quality of life not only for millions of parents but, crucially, for their children.

I was tempted to say that the Bill represents a baby step in the right direction, but it represents so much more. This is a hugely important change for mothers, fathers, children, families and employers. As such, I am incredibly proud to stand at the Dispatch Box and to commend the Bill to the House.

17:14

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

I want to begin by saying that the Opposition welcome any new investment in child care and any extra support for the millions of hard-pressed people—parents and families—up and down the country who are battling to juggle their work and family lives. We are the party that, in government, set the precedent for investing in early years and supporting the families that needed help the most and, as a result, tackling disadvantage and improving the life chances of children. Of course, those are aims and priorities that all political parties now accept, thanks to the progress that was made in that area under the last Labour Government. Welcome though any support is, however, the Bill still falls far short of the mark when it comes to making up the ground that has been lost under this Conservative-led Government in regard to meeting and furthering those goals.

Since 2010, all parents have seen reduced support, fewer child care places and spiralling child care costs. We know that families up and down the country are struggling with this. Investing in early years and focusing support on those families that needed help the most are among the greatest legacies of the last Labour Government, and those principles are now universally accepted by all parties of government. Under Labour, parents benefited from a range of policies and investments that helped more parents, but particularly single mothers, into work and lifted more children out of poverty. As a result, more children were given a better start in life.

[Charlie Elphicke]

Does the hon. Lady accept that, according to the measure adopted by the previous Labour Government, child poverty actually rose under that Administration, and that it has fallen under this Government?

[Catherine McKinnell]

No, I do not accept that. It is tempting for Government Members to quibble about measures and markers, and I know that a lot of time has been spent arguing about how to measure child poverty instead of recognising the desperate increase in it. The Institute for Fiscal Studies has projected that there will be 1 million more children in poverty by 2015 than there were in 2010. Government Members need to be careful when obsessing and arguing about those measurements while ignoring the reality, which is that hundreds of thousands more children are now living in homes that their parents cannot afford to heat, and struggling in households where their parents cannot afford to put food on the table and are using food banks.

When we look back on Labour’s record in government, we are proud of the introduction of the Sure Start local programmes and the subsequent huge expansion of Sure Start centres up and down the country. We are proud of the free part-time nursery education that we introduced for all three and four-year-olds. We are proud of the more affordable and higher-quality child care that we brought in through the employer-supported child care voucher scheme, and of the child care tax credits and the introduction of the early years curriculum. We are also proud of the increased financial support for families with children, including the introduction of tax credits and the increases in child benefit and maternity pay and grants. Those policies and changes were aimed at giving every child the best possible start in life but, perhaps more importantly, they lifted 1 million children out of relative poverty and more than 2 million children out of absolute poverty.

[Chloe Smith (Norwich North) (Con)]

Does the hon. Lady now recognise measures, then?

[Catherine McKinnell]

I genuinely do not understand the hon. Lady’s intervention. Obviously, we recognise that there are measurements of child poverty. The point I was making was—[Interruption.] No, I did not say that I did not recognise measurements of child poverty; we introduced them. What I find unacceptable is that the Government quibble and argue about how to measure child poverty rather than taking the necessary action to deal with a problem that is staring them in the face—namely, an increasing number of children in poverty. As the IFS concluded in 2011, the reduction in child poverty during the first two terms of the Labour Government was

“by far the largest and most sustained since”

figures began in 1961. As UNICEF pointed out when it compared child poverty levels internationally in 2010,

“without UK Government intervention in the form of cash transfers, tax credits and services for children and families, the UK would see a child poverty rate three times higher than its current levels.”

Government Members seem to be quite vexed about this issue, but I think that that is because they have a shameful record. Unfortunately, the story under this Government has been very different from that under the Labour Government. That is the case despite the promise in the Conservative manifesto in 2010 to

“make Britain the most family-friendly country in Europe”.

It added:

“We will help families with all the pressures they face: the lack of time, money worries, the impact of work, concerns about schools and crime, preventing unhealthy influences, poor housing.”

Let us not forget the Liberal Democrats—I am pleased that one of them is here today. Their 2010 manifesto claimed:

“Liberal Democrats believe every family should get the support it needs to thrive, from help with childcare through to better support for carers and elderly parents. Liberal Democrats will improve life for your family.”

Have those promises been translated into reality? We know that parents are facing a child care crunch because child care costs have spiralled, the number of places has fallen and the support that families receive from the Government has been slashed. One consequence is that progress on reducing child poverty has stalled.

[Hywel Williams]

Does the hon. Lady agree with Plaid Cymru that the answer to the child care problem, particularly in areas where there is little or no provision, is a child care guarantee for all, based on the Nordic model that has operated very successfully in Sweden for a long time? Does she agree that she has a role in persuading her Labour friends in the Welsh Government to adopt that model?

[Catherine McKinnell]

We all want to see more child care places. We recognise not only that there is a challenge in meeting the costs of child care, but that we need to do something on the supply side if we are to see the costs come under control. That is why I will set out exactly how Labour has proposed to deal with that issue. Although we support the measures that are being proposed, despite having quite a number of questions to raise about them, we suggest that there are actions that the Government could take today on the supply side to increase the number of child care places that are available, which has been falling.

[Sarah Newton (Truro and Falmouth) (Con)]

I take issue with what the hon. Lady is saying because of my experiences in my constituency. I have just looked at the data and there are 100,000 more places in nurseries today than there were in 2009. Of course, with that increase in supply, prices are falling.

[Catherine McKinnell]

I do not recognise what the hon. Lady is saying. If she is saying that that is happening in her area, I would be interested to see the data to back that up. We know that 35,000 fewer child care places are available and that prices are rising. Parents out there are struggling with the cost of child care—indeed, the Government accept that it is a challenge for many households up and down the country—and I think that they would find it deeply disconcerting to hear an hon. Member suggest that prices are falling and that everything is fine. Government Members seem to be very detached from the reality that families are facing up and down the country.

[Charlie Elphicke]

Will the hon. Lady tell the House how the number of childminders changed under the previous Government? Does she accept some responsibility for what amounted to a war on childminders by the Labour party?

[Catherine McKinnell]

Perhaps the hon. Gentleman is reading that argument from a Whip’s handout, although I know it is one that Government Members like to quote. The Professional Association for Childcare and Early Years, which I would trust more than I would trust the hon. Gentleman on this subject, has commented specifically on that issue, stating that that statistic has often been quoted in the past few months but it is not one that it recognises. The association does not recognise the statistics that the Government are trying to use to establish the case that Labour let the country down on child care. The reality and experience of households and families up and down the country is that Labour has a proud record of supporting families with children to get into work and with the costs associated with child care, and of ensuring there are enough child care places—certainly not the reduction of 35,000 places that we have seen since the Government took office.

[Charlie Elphicke]

rose—

[Catherine McKinnell]

Does the hon. Gentleman wish to come back and dispute again what the Professional Association for Childcare and Early Years says?

[Charlie Elphicke]

For clarity, I did not speak from some handout. I have been concerned about this issue for a long time, and I garnered research from the House of Commons Library which sets out the official statistics on numbers of childminders. Those numbers were massively reduced under the previous Government, which caused a lot of difficulties for families that I represent in Dover and Deal who are hard pressed and find it hard to afford more expensive child care options.

[Catherine McKinnell]

Perhaps the hon. Gentleman will look again at his House of Commons Library note and explain in his contribution why we have seen 3,000 fewer childminder places since the Government took office. Overall, there is a worrying trend of reducing child care places and rising child care prices, and he will understand that basic economics mean that households up and down the country are struggling to deal with the cost of child care. Many households—particularly women—are making the choice to stay at home because it is simply unaffordable to go out to work.

The Minister spoke passionately about the increasing number of women in work, but she will acknowledge that there is a lot more work to do on that and we still fall behind on maternal employment in OECD comparisons. We need to make progress on that so that parents who want to work can do so and so that child care is affordable.

[Sarah Newton]

There is no complacency whatsoever on the Government Benches about helping those hard-working families who are struggling with the costs of child care. The hon. Lady asked where I got my numbers from. I have just looked, and the Department for Education website’s annual survey of child care and early years providers clearly shows that the number of child care settings has increased and that prices are coming down, although there is still more work to be done. This is not the first time the Labour party has got the numbers wrong so I am not surprised, but she should have the good grace to acknowledge when she is wrong.

[Catherine McKinnell]

I thank the hon. Lady for her clarification, but we know that over the course of this Parliament we have seen a reduction in the number of child care places and an increase in the price of child care. Part-time nursery prices have risen five times faster than pay, and in the past four years alone in my region in the north-east prices have risen by a staggering 50% for households that are already struggling to make ends meet. The average bill for a part-time nursery place of 25 hours a week has gone up to £107, and the average weekly cost of a full-time place has risen to £200 or more. It is hardly surprising that the Family and Childcare Trust has calculated that families are paying more on average for part-time child care than they spend on their mortgage, with some handing over a staggering £7,500 a year more for child care for two children—around 4.7% more than the average mortgage bill.

[Hywel Williams]

What does the hon. Lady make of the argument put forward by the Institute for Public Policy Research that a similar scheme introduced in Australia led to the doubling of child care costs in 10 years, and that the basic flaw of the scheme is that it is regressive?

[Catherine McKinnell]

The hon. Gentleman raises a very important point. We need reassurance from the Government that they have considered the data from experiences in other parts of the globe. Examples show that dealing only with the demand side, supporting parents with child care costs, simply increases the price of child care for families rather than bringing it down. Ultimately, that costs parents and the Government more, because they end up forking out more for a smaller number of child care places.

There seems to be a huge debate about the figures, but official figures show 35,000 fewer child care places across the country. In my region of the north-east alone, we have lost more than 5,000 places. Even the coalition’s flagship offer for two-year-olds, which is due to be extended in October, has floundered, with the child care Minister, the hon. Member for South West Norfolk (Elizabeth Truss), admitting last November that 38,000 of the 20% most disadvantaged two-year-olds—38,000 out of 130,000—did not have the places to which they were entitled. In May 2014, she updated the House on progress, with 10% of the most disadvantaged two-year-olds still without places. Perhaps most worrying of all is that there are 536 fewer Sure Start children’s centres than there were in 2010—an average loss of three a week. That is the figure we have, but the Minister removed the online database last autumn. Perhaps she will comment on this. I would have thought that, given her professed interest in supporting families and dealing with these issues, there would be a desire to continue to monitor the number of child care and Sure Start places available. It is alarming that we can no longer keep track of the figures on the Government website.

In addition to all that, parents have seen the Conservative Government give a £3 billion tax cut to the top 1% of earners, more than three quarters of whom are men. At the same time, parents have seen cuts of £15 billion. Support to families to balance their work and family life, such as tax credits, child benefit, maternity grant allowances and statutory maternity pay, has been reduced. The reductions to tax credits alone have meant that some families have lost up to £1,560 a year, while the House of Commons Library estimates that families with newborn children could be up to £1,725 worse off over the initial two years.

New analysis of the households below average income statistics published earlier this month shows that under this Government it is families with children who have seen the biggest falls in their income, relative to those without children. Since 2009-10, a couple with two children aged five and 14 are on average £2,132 a year worse off in real terms. In contrast, a couple with no children are £1,404 a year worse off. A single person with two children aged five and 14 is on average £1,664 worse off, compared with a single person with no children, who is £936 a year worse off. We know that everybody is worse off, but families with children in particular are bearing the brunt. These figures only reflect tax and benefit changes, and the impact of wages falling relative to prices has left working people on average £600 a year worse off since 2010.

Even more worrying is that new research published last week by the Resolution Foundation suggests that the official statistics may well have underestimated the fall in living standards, because they take no account of the wages of the self-employed. The fall in wages could be between 20% and 30% greater than originally thought. As we know, this could prove particularly relevant to women’s experiences, because according to the Office for National Statistics, women have made up more than half of the growth in the number of self-employed since 2008.

We must not forget that the true impact of this coalition Government’s failure is felt not just by parents, but by their children. The latest HBAI figures show that the progress Labour made in lifting more than 1 million children out of poverty has ground to a halt. Equally worrying, the number of children living in what is deemed to be material deprivation is on the rise, with 300,000 more children living in families that cannot afford to keep their house warm, 400,000 more children living in families that cannot afford to make savings of £10 a month, and half a million or more families unable to afford to replace broken electrical goods. Worst of all, a forecast by the Institute for Fiscal Studies indicates that while Ministers and, clearly, their Back Benchers squabble over how to adequately define child poverty, which seems to be a distraction from their failure to deal with it, almost 1 million more children will be living in poverty in 2020.

[Charlie Elphicke]

The hon. Lady challenged me on my figures. In a House of Commons Library note, taken from the Department for Education and Skills statistical volume, there were 365,000 childminder places in 1997, but by 2010 that number had fallen to 280,000. Does she recognise that that is a really poor record on child care with childminders?

[Catherine McKinnell]

The hon. Gentleman seems to have gone off the subject of child poverty, which is what we were dealing with. Going back to childminders, there was some movement in respect of the database of those registered when the Ofsted registration system came into place. If he is suggesting that he does not support Ofsted registration, I would be interested to hear more of his views.

[Ms Ritchie]

My hon. Friend talks compellingly about properly funded child care and the growing levels of child poverty, and she is characterising the position well. In that regard and in view of the volatility in the labour market, the slight economic upturn and the number of temporary or freelance-type workers, could she explain how those people will be impacted by the Bill’s provisions? Will they find themselves in a more difficult position?

[Catherine McKinnell]

I thank my hon. Friend for that intervention, which brings us back to the issue of child poverty and the importance of child care in supporting families and particularly children in getting out of that situation. She raises an important point, and I shall be coming on to ask some questions about the Bill’s implementation in that regard. Contrary to the impression given by the Minister, there is still a lack of clarity about who will and will not benefit from the changes. I shall reflect only momentarily, Madam Deputy Speaker, on the wider point that my hon. Friend raises. Our very flexible labour market can make it difficult for many parents to manage their child care arrangements. We know that many women, for example, are subject to zero-hours contracts, which can make it very difficult to plan for child care and the costs and availability of child care, when they might not know what hours they will be working from one week to the next. I hope that the Minister will take all those issues into account, particularly in respect of supporting families, which could be dependent on the interaction between the implementation of this policy and universal credit.

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

The hon. Lady mentioned universal credit. Earlier, she was saying how difficult it was to plan for child care. Government Members were surprised that the Leader of the Opposition did not condemn last week’s strikes, because those are exactly the kind of issues that are a nightmare for parents.

[Catherine McKinnell]

I think that the hon. Lady is straying somewhat from the subject of the debate, but I also think that a number of the workers who were involved in Thursday’s strikes were among the very lowest paid, who we know need this child care support and who are struggling to make ends meet. That was one of the motivating factors in the action that they took last week. I therefore do not think that the hon. Lady’s point was entirely irrelevant, but let me now return to the issue that is under discussion, which is child poverty.

There is concern about the fact that much of the progress that has been made has been either halted or, even worse, reversed by the Government’s policies over the last four to five years. The Government are absolutely on track to miss spectacularly their statutory obligations in terms of eradicating child poverty. As their own child poverty adviser Alan Milburn said recently,

“The Government’s approach falls far short of what is needed to reduce, let alone end, child poverty in our country.”

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order. I must draw something to the hon. Lady’s attention. Child poverty may be ancillary to the Bill that we are discussing, but she said that the matter before us was child poverty, and it is not; the matter before us is the Bill. However, I am sure that the hon. Lady is illustrating her remarks by referring to child poverty, and that she will soon return to the subject of the Bill.

[Catherine McKinnell]

Indeed, the next sub-heading in my speech is “The Bill”, so thank you, Madam Deputy Speaker. My point was that child poverty was the issue—the issue in front of us—with which I was dealing before I took a number of interventions. That issue is very pertinent, because we know that the provision of affordable child care is one of the key measures that will help children to be lifted out of poverty. We know that enabling parents to go to work and to be in stable, secure employment is the primary way of enabling them to bring their families out of poverty.

Let me reiterate—in the context of today’s debate and the Bill—that we support any Government action that will help families who are struggling with the child care crunch. However, as we know, this additional support does not do nearly enough to make up some of the ground that has been lost over the past four years. For a number of reasons, there is doubt about how effective it will be even when it arrives, in about a year’s time, and about how much better off families will be. The bottom line is this: the Bill confirms that there will be no help for parents who are facing a child care crunch until after the next election, which means that there will be virtually no help with child care for an entire Parliament under the Conservatives and the Liberal Democrats.

[Ben Gummer (Ipswich) (Con)]

I am glad that the hon. Lady has now returned to the issue that is before the House. She has talked about lost ground. In every single year of the previous 13-year Labour Government, child care costs went up. Last year, for the first time, they went down. Where was the lost ground in those two Parliaments?

[Catherine McKinnell]

Of course child care costs will rise with inflation, but we have seen a spiralling increase. Child care costs have risen much faster than wages, and the increase has been much faster than previous increases in terms of the natural economic cycle. When I talk about lost ground, I am talking about the support that is available to families across the board, which we know has been reduced on a range of fronts—not to mention the reduction in the working tax credits and child care tax credits that are available to working parents. I think that, in introducing the Bill, the Government have recognised that they have a problem, namely that there is not enough support out there for working families. We need to ensure that this Government support, although welcome, goes further. We need to ensure that it goes far enough, and is implemented properly. That is the basis of the questions that I now wish to put to the Minister.

[Bridget Phillipson]

Is it not right that before 1997 child care was simply not regarded as an issue worthy of debate in the way that it is now? The action that the Labour Government took over 13 years brought this issue to the fore for the very first time. Previously people who raised this as a matter for Government to deal with were simply laughed at. For the first time, the Labour Government brought this issue to the fore and regarded it as a matter for Government action, not just for families to deal with on their own.

[Catherine McKinnell]

My hon. Friend makes a powerful and important point, and I think we should celebrate on a cross-party basis the fact that we now have consensus that the Government need to take on board this issue and that addressing it can improve the life chances of families, in particular children. That is a huge credit to the last Labour Government who pushed this issue forward and raised it up in terms of political acceptance and cross-party agreement and as an issue that Government cannot simply turn their back on.

None the less we have seen soaring costs, falling numbers of places and cuts in tax credits for thousands of families and, as a result, in 2015 families will be worse off than they were in 2010. Even when the help arrives, it is unclear who exactly will benefit from this scheme, and even then it is unclear how much better off some people will be and many might legitimately ask whether they will actually be better off. In the Government’s original consultation last August, they estimated that 2.5 million working families would be eligible for support under this scheme, but in their revised consultation, set out in the subsequent consultation response in March, that number was reduced to 1.9 million families, and therefore around 2.6 million children. However, the Government estimate that only two thirds of those 1.9 million working families—so, about 1.25 million—will have qualifying child care costs. As far as I can tell, however, Ministers have never properly explained what that crucial difference is, because clauses 1 and 2 of the Bill define qualifying child care based on two criteria—first, whether the child care is provided by a registered and accredited provider, and, secondly, where one of the main reasons for the child care is to enable parents to go to work—but that does not explain why 1.9 million families are eligible, yet only 1.25 million such families have eligible child care costs. In fact, as far as I can tell, the Bill does not specifically refer to qualifying child care costs anywhere. I see the Minister shaking her head and I am sure she would like to clarify this point.

[Nicky Morgan]

First, I said in my speech that qualifying child care costs would be defined in the regulations that have been published today and that, no doubt, we will be discussing in Committee. In relation to the other two points the hon. Lady raised, first I am sure she welcomes the fact that, as part of the announcements in March, we said tax-free child care must be rolled out much more quickly, which partly accounts for the change from 2.5 million to 1.9 million, as we are much better able to estimate because we are rolling it out over a period of 12 months. Secondly, we must appreciate that some families will want child care but it will not be for the purposes of going to work and therefore the taxpayer will not be paying for it. There is also the element of child care having to be Ofsted registered, and, again, many families will decide that they do not want to access formal child care which is Ofsted-registered as they instead have other child care arrangements. Again, that is something the taxpayer is not going to cover at this stage.

[Catherine McKinnell]

I thank the Minister for that clarification, but I am surprised she thinks it is acceptable that on the day we are debating this Bill on Second Reading we should be able to debate these regulations that have only been published today. I am also very surprised by the comments she makes about the timetable. The Government have obviously had to re-consult on this issue so they are far behind their original timetable anyway, so I am not—

[Nicky Morgan]

Will the hon. Lady give way?

[Catherine McKinnell]

In a moment I will. First, I will finish what I am saying, which is that this is far too little, too late, and no child care support is available from this Government for this entire Parliament, but I would be happy for the Minister to correct me on that.

[Nicky Morgan]

The regulations were published today for this Second Reading debate, earlier than might otherwise have been the case, because I wanted the House to be informed. Moreover, the consultation that we have launched in relation to the delivery providers in no way affects the Bill’s timetable. I would not want the hon. Lady to let the House think that the timetable is affected. It certainly is not. We intend that the scheme will be launched and ready for families to access from autumn 2015, as we have always said.

[Catherine McKinnell]

I was referring to the Government’s original timetable that they are already behind on, but I appreciate that it is intended this offer will be implemented in autumn 2015, as she says. We hope that that will be the case. However I do have a number of questions about the implementation. Unfortunately, Ministers have repeatedly refused to set out the specifics of who will be better off and by how much, or whether people will be better off as a result of these measures. I have tabled a series of written parliamentary questions to try to gain clarity on those points, but disappointingly, although not surprisingly, the answers from the Financial Secretary have not been helpful in the slightest. In many cases, the right hon. Lady has simply failed to answer the questions. It would appear from her responses that the Department is simply not aware of what proportion of families paying for child care will benefit from the Bill, how it will benefit different income groups proportionally, and what the average top-up will be per child once the scheme is up and running. It is hard to believe that the Treasury is not in possession of such data. Surely it is fundamental to understanding what the Bill’s impact might be on the Exchequer, and on children and families.

The only indication that we have about how the Bill will impact on different income groups is from work undertaken by the Resolution Foundation, which suggests that the scheme could be skewed towards higher earnings, which might go some way to explain why the Minister has been so unforthcoming with responses to the various questions put.

[Mark Durkan (Foyle) (SDLP)]

On that very point, has my hon. Friend noted that the Family and Childcare Trust has made it clear that the 1.25 million families that will benefit from this, are only about half or slightly over half of those who are paying for child care costs, and 80% of those who will benefit under this measure are in the top 40% of the income distribution?

[Catherine McKinnell]

My hon. Friend raises an important point and puts forward compelling evidence as to why we need to question the details on this. [Interruption.] The Minister says that it is not true, but if it is not true, why is she not forthcoming with the Treasury data on this issue?

As Gavin Kelly, chief executive of the Resolution Foundation, pointed out, the Government’s decision to increase the spending cap is likely to benefit those on the highest incomes, despite the fact that it is low and middle-income families who are struggling the most with the rising costs of child care, for whom it is acting as a barrier to taking on more work. He said:

“About 80 per cent of the gains from this will flow upwards to those in the top half of the income distribution.”

Throughout the Bill’s passage in the House, we will continue to press for some clear, transparent information from Ministers so that parents can be clear about what they can and cannot expect to receive in support. At the moment, the Bill is completely devoid of any of this information.

None the less, despite a lack of answers from the Minister, there is a curious line in the Bill’s impact assessment, which states that, of those families that the Government say will gain as a result of the new scheme,

“the average additional support they will receive is £600 per year”—

£600 per year on average. That stands in complete contrast to the claims of Ministers who have implied that working parents are all in for a £2,000 child care subsidy. Indeed, the Financial Secretary’s own website, summarising her week of activities when she announced this revised child care scheme in March this year, suggested this was the case. She said:

“The new Tax-Free Childcare scheme which I am guiding through Parliament will provide 20 per cent support on childcare costs up to £10,000 per year for each child via a new simple online system. This will mean an average saving of £2,000 a year per child.”

I hope that she will set the record straight on that point, because her Department’s own impact assessment suggests a very different reality.

I would also like to take this opportunity to probe the Minister on the Government’s plans to support 85% of child care costs for all universal credit claimants. Under the Government’s original plans, only those universal credit claimants who paid income tax—the highest earning claimants—would be eligible for 85% of support. Everybody else would be covered for only 70% of costs. We welcomed these changes as they signified a reversal of the Government’s decision to cut the child care element of working tax credit from 80% to 70% in 2011, a move that we opposed because we recognised that it simply served to hit those parents who needed the support the most. But it would seem that this could be yet another example of the coalition Government giving with one hand and taking away with the other.

As Alan Milburn, chairman of the Government’s Social Mobility and Child Poverty Commission, has made absolutely clear, low-income families could still lose out despite the increase in support for those most in need. He told The Independent on Sunday:

“The Government has taken half a step forward. The announcement that 85 per cent of childcare costs will be met under universal credit from 2016 will help work pay for low-income families. This is very welcome. The sting in the tail is that this £200m expansion in childcare support will come from within the universal credit programme. This risks robbing Peter to pay Paul.”

The Minister did not provide any clarity when my hon. Friend the Member for Worsley and Eccles South (Barbara Keeley) probed earlier in relation to this, but there needs to be some upfront response. How exactly do the Government intend to pay for this increase in support?

There is another key concern. We now know that the universal credit programme is in complete disarray under the Secretary of State for Work and Pensions, and the Treasury is refusing to sign off on the programme’s business case, and there are concerns that low-income parents may now be waiting until 2017 at the earliest to receive this welcome additional support. Again, I have tabled a number of written parliamentary questions to ascertain whether this will be the case, and, again, disappointingly but perhaps not surprisingly, the Minister has failed to answer any of these questions. I put it to the Minister today: when can the 4 million low-income families who will be eligible for universal credit expect to receive support to cover 85% of their child care costs? [Interruption.] The Minister says she has said it, so will she give a cast-iron guarantee today that they will be in receipt of these payments by 2016? Will she confirm that at the Dispatch Box? No.

[Mark Durkan]

Does my hon. Friend recognise that whereas the new scheme seems to offer up to £2,000 per child, with no limit on the number of children, child care support under universal credit is capped, so anyone with more than two children is effectively losing out when compared with those who benefit from the new scheme? Would child care accounts not be a fairer way in universal credit as in this scheme?

[Catherine McKinnell]

rose—

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order. Before the hon. Lady replies to the intervention, I simply draw it to her notice that she has now spoken for 44 minutes, which is more than twice as long as the Minister. I am not stopping the hon. Lady speaking because I appreciate that she is making some very good points and putting questions that have to be put. But before she considers taking other interventions, she might consider that other Members are waiting to speak.

[Catherine McKinnell]

Thank you, Madam Deputy Speaker. I am grateful for your guidance.

The final point I want to make concerns the delivery of this scheme. We are now some 14 to 16 months away from when the scheme should be up and running, according to the Government’s revised timetable, yet the Government still have not made a decision—at least publicly—about who will deliver the child care accounts through which parents will access Government top-ups and pay for child care. They originally announced in their consultation response that National Savings & Investments would be their delivery partner, but after ditching that decision and the preceding consultation process, they have backtracked and reopened the consultation process.

Will the Minister tell us why the Government commissioned a £38,000 cost-benefit analysis report by Economic Insight, which recommended an open, competitive market model for delivering child care accounts, and then simply ignored the report’s recommendations and chose an in-house provider, NS&I, instead? Will she clarify who will be delivering the child care accounts under this in-house option, as it is my understanding that the former Economic Secretary to the Treasury, now Secretary of State for Culture, Media and Sport, awarded a seven-year outsourcing contract to Atos in May 2013 to deliver all customer-facing and back-office services to about 25 million NS&I customers? If the Government continue with the previous plan to have NS&I deliver child care accounts, will the Minister clarify whether it will in fact be Atos delivering them? If that decision is taken, does the Minister plan to renegotiate, or at least revisit, NS&I’s contract with Atos to ascertain whether the company is up to delivering and maintaining accounts to potentially 2 million parents, considering that this would be significantly different from NS&I’s current activities?

[Hywel Williams]

Does the hon. Lady share my concern that National Savings & Investments was only recently held to be in breach of its responsibilities to provide services in Welsh and had to change its services very quickly to conform to its legal requirements? Does that dent her confidence that NS&I might not be able to deliver services to everyone in Wales?

[Catherine McKinnell]

The Government need to reassure us over NS&I’s ability to provide this contract and to tell us whether services will be provided by Atos, especially as Atos’s delivery of universal credit and personal independence payments has been such a shambles. With just a year to go, it is important that Ministers get a grip and make some decisions. As with universal credit, any further delays in implementation will only hurt hard-pressed families who are already struggling with the cost of child care bills.

Let me turn briefly to our proposals for investing in child care which, on top of what the Government are providing today, would deliver a real difference to hard-pressed families who are struggling with the child care crunch. We have said that we will build on previous efforts and extend free child care for three and four-year-olds from 15 to 25 hours a week for working parents. We will give parents peace of mind by setting down in law a guarantee that they can access wrap-around child care—from 8 am to 6 pm— through their local school, if and when they want it.

As with the 15-hour early years entitlement, introduced under the previous Labour Government, the new 25-hour offer would be for 38 weeks of the year, which would mean more than £1,500 of extra support per child per year. It would not demand that working parents spend more and more of their own money on child care in order to receive some cash back from the Government, as this Bill will demand of them. Regardless of what working parents of three and four-years-olds choose to spend on child care, they will be entitled to 25 hours a week for 38 weeks of the year.

We know that having school-age children can be a logistical nightmare for many parents, and that too many of them find it increasingly difficult to find after-school and before-school child care. According to a Department for Education survey last year, 62% of parents of school-age children said that they needed some form of before-and-after school care or holiday care to combine family and work, but of these, nearly three out of 10 of them were unable to find it. That is why Labour will introduce a primary child care guarantee to benefit parents of primary age children, because that is when families most require child care support.

[Charlie Elphicke]

rose—

[Catherine McKinnell]

I will not give way, as I must make progress.

In conclusion, while we welcome any extra investment in child care, the Bill does not make up for how much more families are paying for child care under this Tory-led Government, and it confirms that no help will arrive for parents facing a child care crunch for at least another 14 months. Families have already seen their child care costs rise five times faster than pay. Many already spend more on their child care than on their mortgage. Parents have seen the number of child care places fall by the thousands, and, despite the Prime Minister’s promises to the contrary, too many communities have seen their local Sure Start children’s centres close.

Most stay-at-home mums, as well as working parents, have already said that child care costs are the biggest barriers to their either going back to work or increasing their hours. Working parents and families need help now, not in 14 months’ time. But equally importantly, Ministers need to come clean over who will benefit from this scheme and by how much, so that parents can make an informed decision about which form of support will be most appropriate for them.

We will support the Bill’s Second Reading as we welcome the additional support for families because we know how much they are struggling, but we will scrutinise every detail to get the answers to the questions that we put today, as there are many areas in which the Government are not being up front. Critically, this Bill falls far short of what is needed to make up for the last four years of spiralling costs, falling child care places and cuts to vital support for families. Parents deserve better than that, which is why the next Labour Government will extend free child care for all three and four-year-olds as well as introducing a primary child care guarantee to give parents peace of mind.

18:06

[Priti Patel (Witham) (Con)]

May I say what a pleasure it is to speak in support of this Bill, which I welcome for many reasons, but predominantly for the long overdue support it provides to hard-working parents up and down the country. It shows parents that the Government are on their side as they return to work, fulfil their career aspirations, provide better futures for their families and their children and encounter new opportunities. It is incumbent on the Government to play a positive role in that regard.

I am a parent; my son is five years old. Like so many Members from all parts of the House, I understand the challenges of child care and work-life balance. I also understand that the costs of child care are far too high—to be fair, that was true under the previous Government as well. It is about time that we all faced up to that. Rather than throwing political brickbats across the House, we must start putting across a positive message about supporting hard-working parents and facilitating affordable child care so that everyone benefits, including children. Rather than being partisan and party political, we should realise that this is about children and ensuring that their futures are secure and that parents have access to good-quality, affordable child care. Parents need to feel comfortable that they are putting their children in the right environment—one in which their children will flourish, feel safe and be stimulated.

[Mr Robert Buckland (South Swindon) (Con)]

My hon. Friend is making a powerful point about the need for flexibility. Does she agree that for parents with disabled children, the need to extend that provision through to late teens is very important? The provision to extend the scheme up to 17 is particularly relevant for those families.

[Priti Patel]

I welcome my hon. Friend’s intervention. He makes a powerful point. When we consider child care and child care payments, it is important to understand that this one size does not fit all—we all have different child care needs. All our children are different; every family is different. The Bill moves us away from the notion that everybody’s situation is similar. We must support families through all sorts of personal circumstances, some of which are challenging and very difficult. We know that both as constituency MPs and as parents.

One of the biggest challenges and choices that parents face is how to raise their children, so the Bill is not only timely but politically significant—we have not had such a measure before. We live in a society in which the pressures on parents are absolutely enormous, whether because of employment, changing jobs, the labour market, social mobility or the fact that we live in an international and global world. Many companies have different expectations of their employees, but employees are parents, too.

[Sarah Newton]

Does my hon. Friend agree that caring for older relatives is another huge pressure on families? It is so important that the benefits of this Bill will be available to those on carer’s allowance. So many people fall out of work because it is too difficult to work while managing caring responsibilities.

[Priti Patel]

My hon. Friend makes a powerful point, which relates to my earlier comments on everybody’s circumstances being different and the flexibilities outlined in the Bill. The ability to reach out to those with different circumstances and backgrounds is paramount. The Bill demonstrates a depth of understanding of the challenges facing families and households. When both parents work, they find it difficult to decide between the costs of child care, which can be in excess of £10,000 a year, and spending time raising children themselves.

We should remember that child care costs vary across the country and that no generic or standardised level or rate exists. Costs are naturally high in London, the south-east and the east. Many working households spend a lot of their income on child care, partly because people do not necessarily live in the conventional family set-ups in which grandparents might be around the corner and able to offer support. I must be perfectly honest that I rely on such a situation. I tell everybody that I am blessed and that I can do this job only because I have outstanding family support to look after my son.

Child care decisions are often made on cost grounds and the Bill goes a long way to reflect that. Over the past decade, the average hourly cost of child care has increased by more than 67%, which is almost two and half times higher than the CPI rate over the same period. The pay of parents in England will vary depending on what they do. In London, pay levels are slightly higher than elsewhere, but many parents pay hundreds of pounds a week to some child care providers, which means that their families are under pressure and more often than not—we have not discussed this—that pressure ends up on working mothers. They are the ones who sacrifice their careers or put them on hold because child care costs can be so high that they have to decide whether going out to work or staying at home to look after their children is more financially expedient. I have much sympathy with those mothers. Many of my constituents with successful professional careers that they want to continue inform me of the pressures and challenges that they face, including the high costs of child care and commuting costs. Essex is not that far from central London, but most of my constituents and others across the county work in London. They are on a treadmill day in, day out. They face pressures and costs and feel as if they have no choice. If people feel that they have to stay at home, it becomes harder for them to re-enter the work force, which is another reason the Bill is so important. It helps mothers in particular to meet their aspirations, which we should all welcome and support.

The Government deserve credit for recognising the pressures, in addition to soaring child care costs, that families and mothers face and the impact of those pressures on families. As with so many other issues, the Labour party ignored that when it was in government. We have heard lots of rhetoric today, but the reality is that it is difficult, a challenge and a balance. It is easy for the Opposition to talk about the Government today, but we have to remember that the economic policies of the past—uncontrolled public spending—hampered the economy instead of helping families. When families needed help, they were hurt. We know about the negative impact that the downturn and its economic legacy has had on households, so now is the right time to focus on support for hard-working families. The Bill is about support for child care costs, but we want to put an end to the shameful past and what parents had to deal with, and to look forward.

As we heard from the Financial Secretary to the Treasury, the Government have gone a long way to bring in positive and proactive measures to help hard-working households: cutting income tax bills, abolishing Labour’s jobs tax; reducing fuel duty; and supporting private business. That applies particularly to my constituency, where SMEs employ 85% of my constituents. We need the private sector and SMEs to be successful to continue to create more jobs. A million new jobs have been created since 2010. The measures are positive and bring a new dynamic to the employment market. At the same time, low earners have been given support with child care costs, including free child care places for some 40% of two-year-olds. Those are the proactive measures that make a difference to middle and low-income families.

As a Conservative, I instinctively believe that the Government should not only support families, but also help parents to make choices about working arrangements, which is why the Bill is so positive and proactive. Families want to be empowered by Governments to make the right choices for themselves. The Bill helps families to make such choices by alleviating some of the financial pressures caused by child care costs. This package of support will help women who want to continue to work to do so. We are already seeing record numbers of women in work and the Bill will help those who have established a career—or those who are just starting out after having taken time off to bring up their children—to continue to develop and to advance in their profession.

The £2,000 a year of support for families is a substantial amount for the Chancellor to find and should be put in the right context. It has been made possible only because of the controls that have been placed on spending and the reductions in the deficit, which the Labour party has opposed. This Government is on the side of hard-working families. The Bill will benefit not only my constituents but working families across the country through sensible and practical measures. I welcome it as a positive way of supporting families and working women.

18:17

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

I had assumed that my hon. Friend the Member for Norwich North (Chloe Smith) would speak ahead of me, but it is a great pleasure to be called today. You are right to looked puzzled, Madam Deputy Speaker. Why is there nobody on the Opposition Benches? We all know that the hon. Member for Newcastle upon Tyne North (Catherine McKinnell) spoke for 52 minutes to mask the fact that no one else on the Opposition Benches would be speaking. That contrasts with 19 and 20 November 2013, when we debated child care in the Chamber. I am slightly disappointed, because I had a good exchange with the hon. Member for Houghton and Sunderland South (Bridget Phillipson) and I am sure that we could have had a similar debate about statistics and measures. Nevertheless, it is great news that we are finally getting to the Childcare Payments Bill and I am pleased to support it today.

One of the big things about the Bill is that it puts matters into the hands of parents. Instead of having to rely on employers setting up schemes, which I believe only 5% of employers actually set up, we will have a system that is effectively direct. Families with two working parents who earn at least £50 a week will benefit in one way or another from Government help towards child care, recognising that we will not double-subsidise those who receive tax credits or universal credit.

On that note, it is my understanding that we will provide an extra £200 million to support those families claiming universal credit, so instead of having 70% of their child care costs paid, as they do today, they will receive 85%. I am sure that will be very welcome to all working families.

Of course, the very richest in our society—those who earn more than £150,000—will not benefit, but I am sure that they will recognise that we must target a welfare system at the broadest number of people.

[Hywel Williams]

Is the hon. Lady confident that when parents in deprived and rural areas are enabled as proposed, the market will deliver the places?

[Dr Coffey]

I do not pretend to know much about Welsh schools, although my cousin goes to school in Wales and I have many relatives there. I am not necessarily aware of the provision that exists, but I know that this Government are keen to work with schools in England to increase the number of schools choosing to make provision for young children. I do not know what the Welsh Assembly Government are considering, but the Under-Secretary of State for Education, my hon. Friend the Member for South West Norfolk (Elizabeth Truss), has consistently tried to introduce reforms that will make child care provision an attractive career. We are right to press ahead with some of the childminder agencies we are introducing, not through this Bill but separately, to remove some of the administrative burdens that might be deterring people from entering that career. I hope that the hon. Gentleman will encourage such agencies to set up in his area of Arfon, bringing new employment opportunities for both men and women and making provision for working parents.

It is great news that under this Government more women are working than ever before, yet we would like to see even more women—and even more parents—going into work. This scheme is part of our long-term economic plan. We recognise that the cost of our child care is the second highest in the OECD as a percentage of family income; only Switzerland’s is higher. I think that it is fair to say that under Labour the number of childminders decreased significantly and costs went up. Before the hon. Member for Newcastle upon Tyne North springs to her feet—if she is not following the latest reshuffle news on Twitter—let me say that I recognise that that trend has continued, but it is not going on at the same level. [Interruption.] I thank the hon. Member for Manchester Central (Lucy Powell) for referring to my haircut. It was nothing to do with the events that seem to be unfolding on Twitter. I merely got a phone call from my own mother complaining that my hair was too long and, as we know, in these situations mothers know best. I am not a mother, so I have to stick with what my mother tells me.

Let me give a few of the reasons why these things matter. A couple of years ago, the Conservative Women’s Forum undertook an inquiry, in which I think you might have participated, Madam Deputy Speaker, into the executive pipeline of talent. It focused not only on the number of women on boards, but on how we encourage women to get up the executive ladder and, more importantly, on what women can do for themselves, what Government can do and what companies can do. The issue of child care was a running theme throughout the inquiry, particularly for those in junior management. Once people are at a certain level, they probably receive a salary that means they do not have to think about the issue; they can pay for a nanny and even though it might be painful, the costs are not quite so prohibitive. We consistently received evidence that the voucher system was inadequate. It did not cover enough of the cost, it was very limited or, as my hon. Friend the Member for Tiverton and Honiton (Neil Parish) mentioned earlier, it did not help people such as the self-employed. I am pleased that the Bill extends the provision to almost anyone in work and it is right that we should do that.

It is also fair to say that no one magic bullet emerged as a result of the inquiry to solve some of the challenges in the pipeline of talent or in how we tackle child care, but nevertheless the discussions before the Budget announcements on how to help with tax relief were exactly the issues being brought up by senior executives. I was glad that the subsequent announcement was made in Budget 2013.

The proposals in Budget 2013 were limited to £6,000 of child care costs, which would have meant a maximum benefit of £1,200. I was pleased that after the consultation, to which significant contributions were made, we were able to change the age limit to 12 and, as my hon. Friend the Member for South Swindon (Mr Buckland) has pointed out, to change the age limit for children with disabilities. We also increased the limit to £10,000, with a maximum of £2,000 support. That was the right thing to do, because it recognised the costs of child care. Nevertheless, it is important that we have retained the choice for parents who are in employer-supported child care schemes to stay in that system while recognising that we will close it to new entrants, so to speak. I support that because, understandably, companies have gone to some expense to set up these schemes and they are popular. We should not withdraw one thing simply for the sake of simplicity for the Government.

The hon. Lady from Northern Ireland—I have forgotten her constituency—

[Mark Durkan]

South Down.

[Dr Coffey]

Thank you. The hon. Member for South Down (Ms Ritchie) referred to the situation in which one parent was not working and asked why they would not get support with child care costs. As my hon. Friend the Member for Truro and Falmouth (Sarah Newton) has accurately pointed out, the consultation raised those points and we have extended the provision when there is a working person and somebody on carer’s allowance or employment and support allowance. When people are enjoying parental leave after having children, they should not be penalised if they have children in child care. We do not want any unintended consequences.

I am a strong supporter of the traditional family. I am sure that I am not the only person whose mother did not work initially after having me, although she did start to go back to work as a supply teacher. It is fair to say that although the Government have scarce resources, they are offering both parents the choice to get back into the workplace, as opposed to one person having to choose, for perfectly good reasons, not to return to the workplace. I therefore support the gist of what the Government are saying about restricting support to cases in which both parents are working or the other cases that have been alluded to.

I am surprised that there are no Members in the Chamber from the Scottish constituencies, because, of course, this is a United Kingdom measure, although I am delighted that we have had contributions and interventions from Members from Wales and Northern Ireland. Much has been made of the fact that National Savings & Investments will initially be providing the child care account. You may have read in the weekend press, Madam Deputy Speaker, that if the people of Scotland choose to go ahead with separation, NS&I will not be able to provide accounts to people living in Scotland, as they will effectively become foreign nationals. They might wish to consider that as another element of the question. I am sure that if somebody from the Scottish National party were here, they would leap up and say, “We will have an even better scheme and it will cost less than yours.” Nevertheless, I am sure that the good people of Scotland recognise that that is unlikely to be the case. The Minister might want to consider the issue in her regulations for this provision, but let us not prejudge the outcome of the referendum. I strongly believe that the people of Scotland will recognise that staying together is better for us all.

[Hywel Williams]

Shall I indulge in some karaoke and repeat the words that the hon. Lady used herself? I am sure that Scotland will provide a much better scheme when it is independent.

[Dr Coffey]

The hon. Gentleman would say that, and he has been very loyal to his nationalist friends. I recognise that.

On the timing, I am sure that my hon. Friend the Minister agrees that if we could bring in the scheme tomorrow, we would do so. However, we do not want to repeat—[Interruption.] Does the hon. Member for Manchester Central want to intervene? I think she said that we have been in power for four years, and I recognise that we are bringing this into play rather late in our parliamentary term, but she will know some of the challenges of government from her previous experience. Nevertheless, I would rather we got this right than end up with the fiasco we had over tax credits, which were brought in in quite a rush, with all the accompanying problems. The hon. Member for Manchester Central might be slightly bemused by that, but overpayment of tax credits and trying to reconcile figures and help people out with that is one of the biggest issues in my constituency casework. She will, I think, recognise some of the challenges of bringing in a new system.

The Bill rightly provides that the connections between the different agencies will be updated quarterly. We are not going to get into penalties and going back and forth, but provision is made for recovery. It is important that parents recognise that they should anticipate the potential impact if their conditions change. To be frank, I think the biggest change will occur when people move from one salary bracket to another, or decide to stop claiming universal credit and simply to claim this instead. At least the hurdle or cliff edge when people have to change is fairly black and white.

[Mark Durkan]

Would the hon. Lady like to see a strong information and advice offer built into the scheme, so that people who are having to decide how to navigate between universal credit and the scheme will get advice and without-prejudice, better-off calculations?

[Dr Coffey]

My expectation is that that would happen naturally. I do not want to overplay it, but I think it would be a natural consequence when people say, “I’m coming off universal credit to get this.” It will be a straightforward calculation, which should be readily understandable.

[Hywel Williams]

I wish I could share the hon. Lady’s confidence. I remember when the tax credit was brought in warning the Government at the time that it was complicated. It was to be administered by HMRC, which was not good at giving people money instead of taking money off them. Despite the confidence displayed at the time, HMRC included in its letters such sentences as, “Even though we told you your assessment was correct, it was not reasonable for you to believe this.” That is a direct quote from a tax credit letter. I am afraid I do not share her confidence that HMRC or any agency of Government is completely competent to administer this scheme.

[Dr Coffey]

I understand what the hon. Gentleman is saying, based on the experience of tax credits. That is why I think the Bill deals with it rather well: the period of entitlement is three months. As it is split up quite well into quarters, it should be quite straightforward for parents to make that assessment of what is better for them to get support. Of course, I am sure we all share the aspiration of reaching a stage where everybody is earning over a certain threshold and does not need to make those calculations.

I will not repeat everything my hon. Friends have said about the excellent work being done through nurseries for three and four-year-olds. I will simply reiterate my view that the Bill brings the balance back into the hands of parents and recognises that child care is normally needed all year round. Something that will need to be tackled with child care provided through primary schools by extending their playgroup is how to ensure that continues through the school holidays, but instead of trying to devise a perfect scheme that meets the demands of every single scenario, which is rather difficult when dealing with millions of children and parents, the Bill simplifies and gives people, through the child care account, the ability to build up balances and use the money as and when they need it. What is important is that parents will not pay fees for the accounts. I heard what the hon. Member for Arfon (Hywel Williams) said about online access, but there will be assisted approaches available for those who cannot access the internet. Internet access is the general default in our efforts to get people on to digital services.

I have not been able to speak for quite as long as the hon. Member for Newcastle upon Tyne North (Catherine McKinnell), but I am delighted to say that there are other Conservative Members here, and I did not spend 27 minutes talking about stuff that is not connected to the Bill. It gives me great pleasure to support the Bill. Today is an historic day in Parliament, as we embark upon a piece of legislation that will affect many working families. I hope the Bill has the unanimous support of the House.

18:34

[Chloe Smith (Norwich North) (Con)]

Mr Deputy Speaker, I am sure it took you many minutes to work out who the next speaker would be in this balanced debate that demonstrates that it is the Conservatives who are on the side of carers and hard-working families.

Child care is an important issue for the many working families I represent. I have been talking to lots of mums and dads, nurseries and pre-schools in Norwich, and I have already had the privilege of raising in Westminster Hall and this Chamber points they made about quality and affordability of child care. Too many people are prevented from being able to earn to support their family or to fulfil their career ambitions by the high cost of child care. As we all know, even part-time nursery places can cost thousands of pounds a year—indeed, child care costs have now overtaken mortgage interest payments to become the most significant monthly outgoing for many British families.

[Charlie Elphicke]

I was wondering whether my hon. Friend has noticed the complete absence of any Back Benchers on the Labour side of the Chamber? Increasingly it seems that the Conservative party is not only the party of the workers, but the party of child care as well.

[Chloe Smith]

My hon. Friend puts it extremely well, and perhaps makes my next point for me, which is that the previous Government failed to deal with the problem of child care costs, and it is the present Government, in particular the Minister for Women, my right hon. Friend the Member for Loughborough (Nicky Morgan), who are doing so.

The Under-Secretary of State for Education, my hon. Friend the Member for South West Norfolk (Elizabeth Truss), who is responsible for child care, has rightly said in the past that a changing economy means that parents need affordable and available child care more than ever, and a changing world means that children need a rigorous, rounded education more than ever. We have before us an opportunity to do both things at once. The context is the tax and benefit changes that came into being this financial year. The biggest reforms in a generation, they will create more jobs—indeed, they have already done so—and they are getting more people off welfare and into work. Child care follows from that, so let us see it in perspective. It is only by sticking to those kind of economic actions—a long-term economic plan, in fact—that we will build a more resilient economy and a more financially secure future for hard-working people and their families.

The cost of living cannot be seen in isolation. The British people cannot be flannelled with phony figures. There can be no economic or household security without the honesty and courage to control the public finances. Labour’s old way has failed—Labour Members would argue with that, if they were here to do so. More public spending led to more welfare bills and more government jobs that the country could not afford. They propose in this debate to use a levy they have already spent 10 times over. Why can they not afford parents the respect of some honesty? This Government, on the other hand, are backing businesses by cutting their taxes, so they can create jobs; cutting tax for individuals, so that their job pays; and controlling welfare, so that getting a job pays more. Universal credit is of course crucial and will be one of the most important reforms this Government make. By replacing working tax credit, it should help my female constituent who wrote to me last week to say:

“When I did work we were over the threshold for working tax credits by around £300 yet I would have to pay £12,000 in childcare cost to continue working.”

Let us look at some other current figures. I am drawing now on the Mumdex—the helpful piece of work that Asda does every month. The latest report shows a rise in spending power for the eighth consecutive month, leaving families £4 a month better off than last year. The main cause is a slowdown in essential item inflation, particularly food, clothes and mortgage interest payments—another sign of a sounder economy. Petrol costs fell again, which eased the pressure on household finances—indeed, under this Government, fuel duty is now more than 13p a litre lower than it would have been without our action, so that the average family saves £7 every time they fill up the tank.

Such results in family finances can only come about with control of the public finances, which has entailed serious decisions by the Government about what to spend hard-earned taxes on. Voters have serious decisions to make as well, as the Conservatives appreciate. As a previous Conservative election poster said,

“Don’t just hope for a better life. Vote for one.”

I am delighted that the Chancellor has put public money towards the tax-free child care scheme that we are discussing. It stands to ease costs for families even more, and here are five good reasons why I support it. First, it will be bigger and faster than first outlined, opening sooner and benefiting in its first year 1.9 million working families with children under 12. That is good progress already in the work that has to be done to bring the scheme forward. Secondly, it will be simple, flexible and easily accessible online. Thirdly, for the first time self-employed parents and those working for the great majority of employers who do not offer the existing employer-supported child care scheme will be able to take part.

Fourthly, the scheme will also help those working part time and on the minimum wage because of the low minimum earnings threshold of £50 a week. Fifthly, as my hon. Friend the Member for South Swindon (Mr Buckland) said, it offers more help for parents of disabled children by recognising that assistance ought to continue until the child is aged 17, rather than 12. I know from experience in my constituency how welcome that will be.

This all means that all working families where the parents earn at least £50 a week will have access to Government support for child care costs unless one of the parents earns more than £150,000 or receives support from tax credits, universal credit or ESC. All told, this gives families greater stability and more flexibility to make their own choices about their family picture. A male constituent told me:

“I’m now on £10K a year, at 39 years of age. My wife, an amazing mother, has to stay at home to look after two of our children, as we cannot afford the child care or would be worse off if my wife went to work.”

The personal allowance will rise in April next year to £10,500. My constituent then may be one of the 400 people in Norwich North who will be taken out of tax entirely by the actions of this Government. He will certainly be one of the more than 38,000 people in my constituency who will benefit from our tax changes. Universal credit will address the abhorrent benefits trap, which is reflected in the quote that I just gave. My constituent and his wife may also benefit from the scheme before us today. I welcome the targeted provision of taxpayer-funded child care for families on the lowest incomes.

[Mark Durkan]

On universal credit, does the hon. Lady recognise that there is a disparity, in that child care support under universal credit will not be paid through the sort of child care accounts that are available under this scheme; they will be only for costs that are already paid out, unlike under this scheme.

[Chloe Smith]

I do recognise that difference, and I am confident that the Minister will look at that carefully. I wonder whether we might deal with it in Committee, and whether Labour Members will be there to do so, as they are absent from the Chamber today. I recognise the point that the hon. Gentleman makes. I do not have the answer, but I am confident that the Minister is working on it.

The new provision, however it is implemented, will be targeted. It is important to add it to the provision that this Government have extended for families on the lowest incomes, beginning with all three and four-year-olds receiving 15 hours a week of free child care, and going on to target this offer to the 240,000 poorest two-year-olds. If that is how the hon. Member for Newcastle upon Tyne North (Catherine McKinnell) defines doing nothing in our years in power, I cannot wait, and I am quivering in my boots, to see what she will do when she marshals some Back Benchers to help her into government.

Let me turn to a couple of points about the quality of child care that we all wish to see as we put the Bill through. I want more great child care to be available and to offer parents more choice and flexibility. I would also like it to be easier for new providers to enter the market and for good existing providers to expand, with consequent benefits for affordability and quality. The Under-Secretary of State for Education, my hon. Friend the Member for South West Norfolk, has said that we know that other countries, such as France and Germany, have excellent systems for comparable amounts of Government spending, while also paying staff good salaries and keeping parents’ costs affordable. I hope my hon. Friend the Economic Secretary to the Treasury will reassure us that the implementation of the child care payments scheme will be simple and cost-effective, will work with other Government systems such as universal credit, and will give parents the confidence that they need and deserve in affordable, achievable, good quality child care in this country.

18:44

[Charlie Elphicke (Dover) (Con)]

May I strike a blow for working fathers, who are also parents, in a joint working household, which is the norm in this country? Sharing the child care responsibility and engaging in that work-life balance—that juggle—is increasingly the norm. I welcome the Bill. Tax-free child care will help all working parents, including fathers like me, with child care costs so that they can go out to work and provide greater security for their families.

That matters because it is important that we help all hard-working people who go out, work hard and do the right thing. Providing 20% support for child care costs up to £10,000 is important to help to make that happen. It is a key part of our long-term economic plan. I welcome the fact that the hon. Members for Foyle (Mark Durkan), for South Down (Ms Ritchie) and for Arfon (Hywel Williams) were here today, whereas no Labour Back Benchers whatsoever were present. That says that the Conservative party is not just the party of the workers, but the party of child care, and the party that is modern, forward-looking and concerned about the kind of future we can build for this country and the hard-working families who do so much to make this country great.

18:39

[Lucy Powell (Manchester Central) (Lab/Co-op)]

I am pleased to speak in the debate. The contrasting numbers of Members on the Government and Opposition Benches may reflect our relative ambitions in this place, with those on the Government Benches sporting their new haircuts and trying to get the party strapline in at every opportunity, while my hon. Friends are enjoying drinks with the Leader of the Opposition this evening. Although we have made much progress in this place towards being more family-friendly, perhaps a Monday evening late night debate on child care is not the best timing.

As my hon. Friend the Member for Newcastle upon Tyne North (Catherine McKinnell) said earlier, we welcome any investment in child care. Families up and down the country are crying out for better access to child care and more affordable child care. For these reasons it is good that Ministers have finally realised, even if it is a little late in the day, the impact that child care affordability has on family lives. We on the Labour Benches believe that high-quality flexible child care is part of the solution to some of the key challenges facing our country. On the economy, our maternal employment rates, particularly for mothers with children aged between one and four, are poor compared with other OECD countries. Child care is a barrier to growing the economy and boosting maternal employment rates. It is unacceptable that in 2014 women still have to choose between looking after their children and having a career.

Over a third of mothers want to work but are unable to do so as a result of high child care costs. Two thirds of mothers would like to work more hours but are unable to do so because taking on more hours would mean higher child care bills. Improving child care will break down barriers for women and help our economy to grow. For families, this is not just about the number of women in work, as some Government Members have said. Child care can help us tackle gender inequality and the motherhood pay penalty. Although the gender pay gap is negligible for young professional women, for mothers the gap is stark.

Mums not only increasingly want to work, but they have to work. As we know, to lift families out of poverty, two incomes are often needed. The killer point for Members who have talked about more women in work under this Government is that figures show that the pay gap between what men earn and what women earn has increased in the past five years for the first time, and that, by contrast, over the 13 years of the Labour Government, the gender pay gap decreased significantly. This is the measure by which we should work out whether policy is effective.

We know that good quality child care is good for society as well. We know that the most disadvantaged children can start school 18 months behind their peers. Good quality child care can close the developmental gap and equip children with the skills and experiences they need to be successful at school. Quality child care can lay the foundations for our country’s future. It can be a key tool in our early intervention armoury and, as my hon. Friend the Member for Newcastle upon Tyne North said, in tackling child poverty. Although we welcome any investment in child care, I believe that in many ways the Bill is a missed opportunity and that it will do little to meet those big policy objectives.

Why is our child care system not working? The price paid by parents is high, yet for too many the quality of child care is patchy. The Government came to office believing that they could solve the problem simply by loosening ratios. That policy failed, and it would not have worked in any case. The Government have failed to address the fundamental problem with supply. We have seen a reduction of over 35,000 in early-years places since they took office. Government Members talk about the increase in reception places at school as though that somehow fills the gap, but they fail to recognise that at the same time the birth rate has increased dramatically, and we are now seeing huge pressure on school and early-years places as a result. The two-year-old offer shows that the system is not working, because a third of local authorities do not have enough places to meet the Government’s own offers.

I have had a number of exchanges in recent months with the hon. Member for Dover (Charlie Elphicke) on childminder numbers. We have seen a dramatic fall of 11% in childminder numbers since this Government took office. There are now 6,000 fewer childminders. It is wrong to say that Labour oversaw a big reduction in childminder numbers as a result of changes in regulation, because Ofsted registration meant that many providers fell out of the system. We heard earlier about comments made by Liz Bayram, who backs up that claim. The Government have done little to increase supply for working parents or parents of disabled children, as the hon. Member for South Swindon (Mr Buckland) mentioned. They have watered down the duty on local government to provide sufficient child care places, and they have also axed the duty on Sure Start centres to provide child care.

All that, taken together, has had a chronic impact on prices. That is why we have seen costs rocketing by 30% since 2010. The Family and Childcare Trust has shown that even part-time child care costs now outstrip the cost of the average mortgage. On top of that, Government policy has had a direct impact on the market. The no-notice changes to tax credits, for example, led to many parents immediately withdrawing their children from day care provision, which had an immediate effect on providers.

The Bill does nothing to address those fundamental issues in our child care market and, in some cases, it makes it worse. That is why Anand Shukla, chief executive of the Family and Childcare Trust, has said:

“Our childcare market is not fit for purpose. It is failing to fill gaps in provision, particularly for those parents who most need childcare; it is failing to drive up quality; and it is becoming more unaffordable for parents despite increased government funding.”

[Hywel Williams]

I am intrigued by what the hon. Lady is saying, because the Childcare Act 2006 obliged all Welsh and English local authorities to ensure that sufficient child care for working parents and those undertaking training or education with the intention of returning to work is available. What happened?

[Lucy Powell]

That is exactly part of the problem here: local authorities no longer have many of those duties, and they do not have the staff or resources to ensure that good local child care markets are acting in that way.

Let me turn to some of the specific measures set out in the Bill. The Government have no plan to control prices. This scheme, on its own, will do nothing to reduce costs, and it could even increase them. It poses a greater risk of price inflation, which is not a good or efficient use of public funding. The Institute for Public Policy Research has show that by 2018 parents will be spending more of their disposable income on child care, even with the tax-free scheme in place. Therefore, although we do not oppose the idea of tax relief for child care, we are critical that the Government have no plans to control costs and use the extra funding to lever in greater quality. Policy evidence is moving much more towards supply-side solutions, such as Labour’s proposals to extend free child care places. Indeed, under previous demand-side schemes there has been price inflation. Have Ministers assessed how the scheme will impact on the child care market and what impact it will have on price inflation?

There will be no help until after the election. The Bill does nothing for families struggling with the costs of child care now. Ministers have cut support for families in this Parliament as child care costs have risen and wages have stagnated. When the policy is introduced, the child care subsidy—that is what it is—will not make up for how much more families are having to pay for child care under this Government, or how much they have lost, as my hon. Friend the Member for Newcastle upon Tyne North so clearly set out.

For clarification, the offer for 15 hours of free child care was actually a Labour Government policy, and the idea of the two-year-old offer, which many Government Members mentioned—it is a good policy that I agree with—was actually put forward by the Deputy Prime Minister. He implemented it in the face of opposition from his colleague who claims to be the Minister for child care in the Department for Education.

Also, the numbers simply do not add up. The Government’s presentation of the scheme suggests that families are going to receive £2,000 per child. That is untrue, and only 100,000 of the 1.9 million families eligible for the scheme—one in 20—will receive the full amount. The Government’s own impact assessment shows that most families will gain by £600 a year, which is well below the £2,000 per child that Ministers have been promising.

Many of the scheme’s benefits will go to the very highest earners—those earning up to £150,000 a year—rather than middle and lower-income families, who have been hit hardest. Only 100,000 of the richest families will benefit from the increase from £1,200 to £2,000 a year per child, which is around 5% of eligible families. The extra money for universal credit, although welcome, has to be found within the existing budget, so where will Ministers find it, and will they clarify today when families receiving universal credit will get the extra support for child care? The Minister said earlier that it will be in 2016. Is that a cast-iron guarantee to which we can hold the Government?

The complex relationship between the scheme and universal credit could leave many families far more confused about whether they are better off in work or out of work and on the borderline between moving to and from each scheme. Will the Minister tell us today how parents will know whether they are better off on universal credit or under tax-free child care? How will the Government support parents moving in and out of both schemes.

The scheme is also quite bureaucratic, with heavy running costs, and a number of questions remain about that. Further clarification from the Government about some of the IT that will underpin the scheme would be welcome. Serious questions remain about deliverability. The Minister said earlier that the scheme is on time, but according to the Government’s own timetable, published last autumn, they are now six months behind because they have had to re-consult on some of the scheme’s specifics. That is because Ministers failed to include key details in the first consultation. Can parents be assured that the scheme will be introduced on time?

As I have said, the Government have no bigger vision for child care. The Bill alone, although welcome, does nothing to address some of the fundamental problems in our country’s child care system. I suggest that the Government develop a much bigger vision for child care, as we did when we were in government—we had the child care plan in 1998, the 10-year child care strategy in 2004 and then the Childcare Bill in 2006—and as we are doing now.

I also suggest that, in order to address the supply-side issue, the Government consider enhancing the role of local authorities in provision; ensuring that Sure Start centres expand to include child care provision, rather than being closed; taking action to ensure that prices do not simply increase and that there is more supply-side support; recognising that deregulation is simply not the answer, because we cannot pretend that we can solve the problem on the cheap; making improvements in quality; taking action on supply and on quality staffing and teachers; adopting Labour’s plans to extend free child care from 15 to 25 hours a week; and giving parents a guarantee of wrap-around care before and after school.

18:59

[The Economic Secretary to the Treasury (Andrea Leadsom)]

I thank all hon. Members who have spoken in the debate. Given the incredibly valuable contribution that this Bill makes to supporting working families, it is a great shame that no Opposition Back Benchers wanted to celebrate its arrival. It is fairly safe to say that the vast majority of Members who spoke agree that more needs to be done to support families with child care costs. It is also safe to say that the majority recognise not only the impact that an improvement in this area could have on millions of households but the impact it could have on the wider economy. We largely agree that more should be done to help more people, particularly more women, back into work. However, some Members described their concerns about the specifics of the scheme or the way in which it will be implemented, so I will do my best to respond to as many of those concerns as I can.

For most of us, having a baby is the most rewarding and challenging thing we ever do. It is incredibly hard to juggle home, children and a job, but whatever families choose to do, we recognise that they are best placed to make that choice. With three kids of my own, and having worked only part-time when they were small, I know I sometimes went to work for a rest, so I take my hat off to all the heroines, and some heroes, who choose to stay at home. This Government support you and salute you. Through this Bill, we want to provide more support for working families. That is why we are introducing tax-free child care to help families with the costs so that they can go out and work if they choose to or need to. They are the right people to make that decision, and we support them in that choice.

Some hon. Members implied that we may have over-consulted, but given the number of people this change will affect, and to help to ensure that the scheme works as well as possible, we have consulted very widely on its design over the past year and listened to the feedback we have received. We are considering the responses to our most recent consultation, which closed on 27 June, alongside those we received on the first one, and we will publish our response in due course. Whatever that response says, though, we are confident that the Bill has the necessary flexibility to allow for the delivery of child care accounts through the private sector or the public sector, and through a single provider or multiple providers.

The hon. Member for Manchester Central (Lucy Powell) made various points about who will benefit from the scheme. First, to qualify for tax-free child care, parents need earn only a little over £50 a week, so this is a boost to all families, whatever their earnings. Secondly, the overall system of child care support remains firmly focused on those on lower incomes. In just two months’ time, the Government will introduce a system that entitles 40% of two-year-olds from the lowest-income families to 15 hours of free education every week. In the Budget, we announced that all families eligible for universal credit will benefit from additional support, up to 85% of costs. We need to recognise that many families—not just the poorest but those across all income groups—are seriously struggling with the high costs of child care. While of course we want to focus our help on those with the lowest incomes, those in higher earnings brackets also warrant some support.

The Government recognise that child care costs have risen significantly over the past 20 years and are a huge issue for all working families. During the last eight years of the previous Government, child care costs increased by 50%, but they are now beginning to stabilise. Figures from the National Day Nurseries Association show that the average fee increase across all nurseries in the past year was just 1.5%, which is below inflation. Nevertheless, child care costs remain a massive problem for many parents who find that their income is eaten up by them. We need to extend free entitlement. That is why we are also increasing the supply of child care places and, ultimately, why we are introducing this Bill.

Government Members made some very good points. My hon. Friend the Member for Witham (Priti Patel) expressed her support for this much needed Bill. She said that flexibility in child care arrangements is absolutely vital to families, that child care costs are very high, that Labour’s economic legacy has significantly hurt families, and that it is important that we now provide support for those families in dealing with the costs of child care. My hon. Friend the Member for South Swindon (Mr Buckland), who speaks with such passion on this subject, welcomed the Government’s support for families with disabled children, who will benefit from this support up to the age of 17.

My hon. Friend the Member for Suffolk Coastal (Dr Coffey) welcomed the fact that more women are in work than ever before. She said that mothers often know best what is needed for child care; of course, we all recognise that. She talked about how to deal with the pipeline of talent and the barriers to working that women face. She highlighted support for carers and those on parental leave and welcomed the Bill’s offer of much more support to working women, in particular.

My hon. Friend the Member for Norwich North (Chloe Smith) explained that there is no household security without controlling public spending. She said that the measures in this Bill, while providing support for families, also ensure that we do not, as Labour Members suggest, just throw unfunded money at a project that could deliver more child care, but at an unknown cost to the public purse.

The hon. Members for Newcastle upon Tyne North (Catherine McKinnell) and for Manchester Central asked how many families will be better off and by how much. I assure them that well over 1 million families will be better off, by an average of £600 a year. It is important to note that the Government support provided through this Bill will be 20p in the pound up to a maximum of £2,000 per child per year. The amount of benefit depends on how much families are spending on child care.

Labour Members claimed that there are fewer child care places than there were at the time of the election, but that is simply not the case. In fact, as my hon. Friend the Member for Truro and Falmouth (Sarah Newton) pointed out, the latest figures show that there are about 100,000 more child care places than there were in 2009, and that represents a 5% increase. However, the Government are not complacent. We are working further to increase child care supply by providing start-up grants for new child care businesses, making good and outstanding childminders automatically eligible for early education funding, increasing the child care available in schools, introducing new childminder agencies, and creating simpler regulations allowing nurseries to expand more easily.

Labour Members questioned why parents cannot use the new scheme at the same time as tax credits and universal credit. Families in receipt of tax credits already receive more generous support with child care costs, and this is being extended in universal credit, where support towards the costs of child care will be available regardless of the number of hours worked and will provide support of up to 85% of the costs from April 2016.

The hon. Member for Manchester Central asked about parents who work on zero-hours contracts. The contractual position of parents will not determine whether they are eligible for the new scheme. The Government want to support all working families with their child care costs. Parents on zero-hours contracts will be eligible for the new scheme in the same way as anyone else, provided they meet the eligibility criteria, including the rules on qualifying employment. As I said, parents have to expect to earn a little over £50 a week, on average, during a quarter.

The hon. Lady asked about Sure Start. I would have hoped that Labour Members were delighted that 3,000 children’s centres are open and record numbers of parents and children are using them—over 1 million. It is up to local authorities to decide how to organise and commission services for children’s centres in their areas. Labour Members will know that I am passionate about children’s centres, as I know they are. However, I am extremely concerned when they talk about centres closing when they know full well that, in many cases, organisations have streamlined their administration by putting a number of centres under a hub system. In fact, only 1% of children’s centres have closed.

The hon. Lady asked how the Government will provide advice to enable parents to make calculations and choose between universal credit and tax-free child care. We recognise the importance of providing information and support to help parents make an informed choice about which scheme to access. Therefore, alongside wider guidance and information, we will provide support and online tools for parents choosing from tax credits, universal credit and the scheme under discussion.

The hon. Lady also asked what we are doing to improve the supply side. As I said earlier, we are taking a number of measures, including introducing new childminder agencies, which will help—

[Lucy Powell]

What will that do?

[Andrea Leadsom]

The idea is to promote more support for childminders. The hon. Lady will recognise that, under the previous Government, many childminders fell off the radar, because, as surveys showed, they felt under-supported, over-regulated and overburdened. The idea of childminder agencies is to provide the support, training and guidance that will enable them to go into business, and to support those that are good and outstanding to expand more rapidly.

As a result of the changes under discussion, more working families than ever before will be eligible for support with their child care costs. The Bill will introduce a less complex, more generous system of support, which should result in more parents being able to enter the work force with the confidence that quality, affordable child care is available for their children. The proposals have been welcomed by families and child care providers across the country and by many businesses that realise how important support for families can be in helping them to attract and retain good staff.

In short, this Bill will support the future of our economy and the well-being of our children. As such, I commend it wholeheartedly to the House.

Question put and agreed to.

Bill accordingly read a Second time.

Childcare Payments Bill (Programme)

Motion made, and Question put forthwith (Standing Order No. 83A(7)),

That the following provisions shall apply to the Childcare Payments Bill:

Committal

1. The Bill shall be committed to a Public Bill Committee.

Proceedings in Public Bill Committee

2. Proceedings in the Public Bill Committee shall (so far as not previously concluded) be brought to a conclusion on Tuesday 28 October 2014.

3. The Public Bill Committee shall have leave to sit twice on the first day on which it meets.

Consideration and Third Reading

4. Proceedings on Consideration shall (so far as not previously concluded) be brought to a conclusion one hour before the moment of interruption on the day on which those proceedings are commenced.

5. Proceedings on Third Reading shall (so far as not previously concluded) be brought to a conclusion at the moment of interruption on that day.

6. Standing Order No. 83B (Programming committees) shall not apply to proceedings on Consideration and Third Reading.

Other proceedings

7. Any other proceedings on the Bill (including any proceedings on consideration of Lords Amendments or on any further messages from the Lords) may be programmed.—(Mr Gyimah.)

Question agreed to.

Childcare Payments Bill (Money)

Queen’s recommendation signified.

Motion made, and Question put forthwith (Standing Order No. 52(1)(a)),

That, for the purposes of any Act resulting from the Childcare Payments Bill, it is expedient to authorise the payment out of money provided by Parliament of any increase attributable to the Act in the sums payable under any other Act out of money so provided.—(Mr Gyimah.)

Question agreed to.

Childcare Payments Bill (Ways and Means)

Motion made, and Question put forthwith (Standing Order No. 52(1)(a)),

That, for the purposes of any Act resulting from the Childcare Payments Bill, it is expedient to authorise the restriction of relief from income tax in respect of the provision for an employee of childcare, or vouchers for obtaining childcare, under a scheme operated by or on behalf of the employer.—(Mr Gyimah.)

Question agreed to.



Business of the House (Data Retention and Investigatory Powers)

Ordered,

That, in respect of the Data Retention and Investigatory Powers Bill, notices of Amendments, new Clauses and new Schedules to be moved in Committee may be accepted by the Clerks at the Table before the Bill has been read a second time.—(Tom Brake.)

Respect Policy

Monday 14th July 2014 Commons Chamber

19:13

[Kevin Barron (Rother Valley) (Lab)]

I beg to move,

That this House approves the First Report from the Committee on Standards, Session 2014-15, Respect Policy, HC 321, which endorses proposals for the operation and review of a policy to deal with complaints of alleged bullying or harassment by Members or their staff towards House of Commons staff.

The motion appears in my name and those of the Leader of the House, the shadow Leader of the House my hon. Friend the Member for Wallasey (Ms Eagle), and members of the House of Commons Commission.

I want to make one thing clear at the outset: the fact that the Committee on Standards and the Commission are inviting the House to agree to a policy to deal with allegations of bullying and harassment is not a sign that there is a widespread problem. It shows the reverse: that the Commission wants to be a good employer and that Members of Parliament themselves want to make sure that any incidents of bullying and harassment are dealt with effectively.

Recent events have shown the dangers of not taking action to deal with potential problems. We are no longer in a situation where a quiet word with the Whips might be used to persuade an MP to change his or her behaviour. We need to be able to demonstrate that we do not have a culture of covering things up or of avoiding difficult issues. We also need to make sure that the system is fair and recognises that complaints need to be handled appropriately.

Although we may have very different political philosophies, those who stand for election do so because they believe in social justice, however they define it. It would be perverse for this House to be one of the few places without an effective and visible policy.

This debate and this policy are necessary because MPs are not employees of the House, but we depend on the services provided by those who are employed by the House of Commons Commission. If staff of the House are bullied by their colleagues, management can discipline those colleagues. If we as MPs bully our own staff, they have rights under employment law, as well as the support structures many parties have now put in place.

MPs, however, cannot be disciplined by the House of Commons Commission if they bully or harass House staff. We are in the position of hotel guests or other service users. If this were a hotel, services might be withheld from a particularly obstreperous MP, but that would be going against everything that the House service exists to do. It has never, ever been contemplated.

If it is to be a good employer, the House needs to have a policy in place that tackles the fact that MPs cannot and should not be subject to sanctions imposed by House management, but provides a clear framework for dealing with incidents when things go wrong. The motion gives us the opportunity to do that, and I believe we should agree it not only because we think it is right and that the House should be an exemplary employer, but for reasons of self-interest. Without such a policy, the House of Commons Commission is vulnerable to legal challenge if things go wrong.

The report by the Committee on Standards, which I Chair, briefly sets out the background to this debate. There has been, and there still is, a respect policy, which comes in two parts. The first deals with the informal resolution of disputes between Members and staff, and it remains in force. The second, which dealt with formal action if differences could not be resolved, has been suspended, because in practice it was found to be flawed, not least because it was seen as unfair to the Members being investigated. Investigation was done by a member of House staff and Members had no right of appeal, but staff did. It was quite clearly, in the Committee’s view, flawed in that way and I think most people agreed.

The note on our website on what Members can expect from the House service makes it clear that dignity, courtesy and respect on both sides are central to the relationship between Members and staff. That is generally the case. I have checked before delivering this speech, and there is not a single live complaint about a Member at present.

That is not to say that bullying is inconceivable: I think we all have to accept that it happens in almost every workplace. We operate in a high-pressure environment, and I am absolutely sure that, sometimes, things are said that are almost instantly regretted. Diffidence and patience with the status quo are not natural qualities for an MP, so a framework is necessary in case things go wrong.

The proposed policy strengthens the informal part of the process and revises the formal part of the process, so that investigation is independent and the complainant has no more rights than the person complained about.

The informal part of the process is most important. It requires Members to be told if they have upset a member of staff. I am told that, in most cases, Members have immediately apologised and taken steps to make amends as soon as they know that they have upset someone. It requires managers to look at the wider picture and consider whether difficulties arise because of a lack of capability or resources. If difficulties cannot be resolved, and both parties agree to it, there will be mediation.

These measures should mean that very few cases are taken forward to the formal stage of the process—that is, possible investigation by the Parliamentary Commissioner for Standards—but it is right that we should have effective measures to deal with such exceptional cases. If a complaint is made, the Parliamentary Commissioner will review the material. She will decide whether the behaviour alleged is so serious that it meets the high bar of conduct that would have the potential to

“cause significant damage to the reputation and integrity of the House of Commons as a whole, or of its Members generally.”

Members will know that that quotation is from Members’ code of conduct.

As the respect policy itself makes clear, the commissioner may be concerned by a complaint about a brusque response in a highly charged political situation. She has the power to make recommendations to management about the handling of the situation and to settle matters informally, if both parties are willing to do so, even at such a late stage. Where it is appropriate, she will be able to investigate and report to the Committee, which will decide what action to recommend.

We recognise that cases of this kind can be difficult for both the complainant and the person complained about, so they will be handled differently from normal complaints. A far higher level of confidentiality will be observed, and names will be released only if the commissioner concludes that bullying or harassment has occurred. As hon. Members know, when the commissioner investigates the activities of a Member of this House, that fact is currently stated on the commissioner’s website, even though nothing is found against the vast majority of Members. The commissioner—like the Committee on Standards and, I believe, the Commission—thinks that that should not happen in the rare circumstances of these cases.

The Committee did not take the decision lightly to endorse the Commission’s proposals. We wanted to be sure that the existence of the formal stage of the process was not seen as an excuse for management to ignore their responsibilities towards both staff and Members. We consulted every Member of the House, and took comfort in the fact that there were very few replies on that point. We did not agree to this change until we were sure that real measures were in place to prevent problems from arising in the first place, and to stop problems needlessly escalating if they did arise.

We wanted to make it clear that this matter is primarily the responsibility of the management of the House. I welcome the fact that the respect policy recognises that difficulties may arise not simply from a Member’s behaviour, but from other behaviour. At the very first stage, it requires line managers to consider whether there is a resourcing, capacity or other issue that needs to be addressed.

We wanted staff training to make sure both that staff are appropriately trained to deal with what I shall call “customers” in difficult situations, and that managers understand their responsibilities under the new system. We understand that training has begun, and that there will be more training for staff of the House to implement the change.

We wanted it to be clear to everyone that the bar for investigations by the commissioner would be high, and we are satisfied that the new policy spells that out. We were also concerned that the new system should work for staff. We asked the House authorities to assure us that staff whose first language is not English will be adequately supported, and I am glad to say that that is included in management guidance.

We are also grateful to the Parliamentary Commissioner for Standards for her work with the House authorities and with us. She worked with the House authorities to make sure that the human resources processes in place recognise that making a complaint to the commissioner is a last resort. She reviewed the procedures for investigation so that there is a separate appropriate procedure for use in such cases. I have already noted the higher level of confidentiality. The new procedure also involves the complainant, as well as the MP, in checking the facts in the commissioner’s memorandum. Both parties will of course have the opportunity to appear before the Committee if there are further proceedings.

There is one final safeguard. The Committee recognises that this is a major change, so we recommend that it is reviewed in the next Parliament, and we invite the House to give the House of Commons Commission, together with the Committee, powers to suspend or renew the policy. I expect the findings of the review to be published and possibly debated, if that is felt necessary.

Let me repeat that I do not expect many cases to be brought under the policy. I do not think that bullying is widespread, but that should not be an excuse not to have an effective means to deal with it. I am sure colleagues on both sides of the House would condemn bullying in any other workplace. This motion gives us the opportunity to make it clear that we will not tolerate it in our own workplace. I hope that the House will agree to the motion.

19:23

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

May I place on the record the thanks of the House of Commons Commission to the Chair of the Committee on Standards, the right hon. Member for Rother Valley (Kevin Barron), for his and the Committee’s work on this very important matter? As with everything it does, the Committee took it extremely seriously, put in a lot of work and came up with something that is thought through and detailed, and does exactly the job we had hoped it would do.

I want to pick up on two of the right hon. Gentleman’s points. The first is that it is absolutely essential that the policy is fair to all parties. It is vital that the House has a respect policy that looks after staff, but it is equally of the utmost importance that it is one in which Members have full buy-in and can feel confident, because otherwise it would not be fair to both sides. The second point is that there are no outstanding complaints at this time. By far the majority of Members treat the staff with the courtesy and respect that they so richly deserve. When it is made clear to them, most Members who have from time to time been errant in their behaviour immediately apologise to the members of staff concerned. The policy is as much a preventive measure as something to deal with a problem, and it puts us into the category of best practice employers. The way in which the right hon. Gentleman framed the opening of the debate is very much what the Commission had hoped for.

I will briefly set out why the policy is so important to the Commission. The Commission is of course the statutory legal employer of House staff, and it therefore has a very important duty of care towards them. Without effective policies on bullying and harassment, the House is more vulnerable to legal charges. There are of course policies in place for bullying and harassment of members of staff by their line managers and employers and for relations between Members and Members’ staff, but there is a gap between members of the House service and Members of the House in that, as was pointed out, we are rather more customers than employers. In that respect, the problem is that unlike the customers of most establishments, who can be shut out by the establishment’s owner if they are felt to be bullying or harassing the staff, it would be unthinkable for Members to be excluded. We therefore require a policy that works, and the respect policy seeks to address that situation.

Notwithstanding the fact that occurrences are very rare, some 7% of staff—nearly 100—experienced some form of harassment, according to a survey of staff, in the previous 12 months. For one in six of those affected, the harassment took the form of repeated incidents involving the same individual. The proportions are small, but that suggests that something like 20 to 25 House staff may experience ongoing problems with one or more individuals.

As the Committee’s report sets out, the policy initially agreed by the Commission in June 2011 proved to be flawed. It was based on policies used by other employers, but it did not fully take into account the special relationship that exists between House staff and Members. I reiterate that the Commission is very grateful to the right hon. Gentleman for taking on this unenviable task. We believe that it has produced something that provides a proper mechanism for dealing with the rare circumstance of the most serious cases. The Committee has concluded that the revised policy is fair to all parties, as I have mentioned. On that basis, the Commission both thanks the Committee and commends the policy to the House for its endorsement.

I should note that, assuming the House agrees to the motion, the policy will come into effect immediately, but it will not be retrospective.

[Kevin Barron]

The hon. Gentleman says that the policy will not be retrospective. However, if somebody has a difficult relationship at the moment, something that has gone on during the past few days, weeks or months might be added to a complaint to the commissioner if she felt that it ought to be investigated. There are no such cases whatever to my knowledge, but just in case there are, I thought that we should mention that the policy would be retrospective in relation to such behaviour over many months or years that is considered at some point in the future.

[John Thurso]

I am most grateful to the Chair of the Committee for intervening to make that point. Of course, at the moment no complaints are extant, so there will be nothing retrospective about complaints that we know about and have dealt with. However, if a complaint is made now, it will of course be subject to this policy.

The House greatly values its staff and the exceptional work that they do in supporting us all. An effective respect policy is a very important part of delivering the Commission’s aim to be exemplary employer. I commend the policy to the House.

19:29

[Ms Angela Eagle (Wallasey) (Lab)]

I support the motion, to which I put my name, on behalf of the Opposition. It states that the House accepts the first report from the Committee on Standards on the respect policy.

I concur with the tribute that the hon. Member for Caithness, Sutherland and Easter Ross (John Thurso) paid to the Chair of the Standards Committee, my right hon. Friend the Member for Rother Valley (Kevin Barron), for the work that he and his Committee have done on this important issue.

Every employer has a duty of care to its employees, and it is absolutely right that the House should be no exception. House staff serve this place with diligence and care, and the least that we must do is to afford them a safe and encouraging working environment and offer them protection against any instances of bullying or harassment, however rare.

After the suspension of the formal stage of the respect policy that was originally endorsed by the House in June 2011, we have endeavoured to replace it with something that works more effectively and that is fair to all concerned. It is therefore right that the House considers the motion to ensure that we have new and comprehensive rules in place immediately.

The changes before us have been explained in detail by my right hon. Friend and the hon. Gentleman, who represents the House of Commons Commission. However, the rules do two important things that I want to highlight. First, they rightly place an emphasis on informal resolution, where it is possible, and emphasise the role of managers in resolving complaints at an early stage. Secondly, they ensure that there is unbiased treatment for the complainant and the person who has been accused. The decision about any formal investigation is taken by the commissioner, who is independent of House staff and Members. Both parties will have equal access to make their case.

As the report notes, the respect policy needs to be fair and be seen to be fair. I am content that the proposals before us meet that test. I am also satisfied that they address the concerns that were raised before the previous formal structures were suspended because of the flaws that my right hon. Friend highlighted so clearly in his excellent opening speech.

It is vital that the changes are well communicated to Members and employees alike. I am pleased that training for staff is already under way. I hope that, after this debate, every effort will be made to ensure that all Members are aware of the new rules. I thank all who have been involved throughout the process of building this package, in particular the Standards Committee and its Chair.

As the report before us states about the new rules,

“the revised Respect Policy is fair to Members and House of Commons staff; has a clear process for investigation; provides both sides with the opportunity to put their case; and provides sanctions for improper behaviour.”

As the report notes, the unions view the changes as the

“basis for an effective and proportionate policy”.

The rules are supported by the House of Commons Commission, as the hon. Member for Caithness, Sutherland and Easter Ross said, and by the Committee on Standards. They provide a sensible and comprehensive process, and I urge the House to support them.

19:33

[The Deputy Leader of the House of Commons (Tom Brake)]

I am grateful for the contributions of all colleagues and for the support that they have expressed. I will speak briefly in support of the motion.

I thank the Chair of the Committee on Standards and the members of the Committee for their detailed and thoughtful report. During the debate, the Chair set out fully the background to the report, and the consideration and reasoning of the Committee in coming to its conclusions and recommendations.

The report sets out the relationship between the House, in particular the House of Commons Commission, and the thousands of people who come to work on the estate every day. The House is unusual in that many of the people who work on the estate are not employed by the House. That applies most obviously to Members of the House and Members’ staff. As the statutory employer, the House of Commons Commission has a duty of care to those it employs, which includes protecting them from bullying and harassment, including by third parties.

We heard from the spokesman for the Commission how seriously the House authorities, including the House of Commons Commission as the statutory employer, take their duty of care towards staff. It is important to reiterate, as did the right hon. Member for Rother Valley (Kevin Barron), that having a policy does not necessarily indicate that widespread problems exists. In such matters, prevention and planning are better than waiting for difficult situations to arise.

I know that we can agree that all workers on the estate deserve to be treated with dignity and respect. I echo my hon. Friend the Member for Caithness, Sutherland and Easter Ross (John Thurso) and the shadow Leader of the House in expressing my congratulations and those of the Office of the Leader of the House to the staff on the outstanding work that they do for us all in this place.

The respect policy is one of the ways in which the House aims to be an exemplary employer. It might be appropriate at this point to recognise the other good work that has been achieved by the House recently, such as its accreditation as a London living wage employer, the offer of minimum guaranteed hour contracts to all previously casually employed staff and the work to secure a long-term pay deal that paves the way for the modernisation of working practices. I am pleased that, as the shadow Leader of the House said, the unions are supportive of the policy we are debating.

I am grateful for the reassurances that have been offered to Members, particularly by the Chair of the Standards Committee. It is right that the bar for the acceptance of complaints for investigation by the commissioner is high, and that there is a higher requirement for confidentiality under the procedure for inquiries under the respect policy than for the other work of the commissioner. The House should also be reassured by the commitment to ensure that training is provided to ensure that managers are equipped to do their jobs, as was set out by the Chair of the Standards Committee. I note from the report that such training has already been provided to large numbers of staff. As the report states, the policy

“needs to be fair, and needs to be seen to be fair.”

Let me remind Members why the House needs the respect policy that has been developed. It is not right that members of staff do not have an independent process of appeal in respect of unresolved complaints relating to Members or their staff. Nor is it right that staff of the House, however senior, should adjudicate on the conduct of Members. The consideration by the Parliamentary Commissioner for Standards, followed by investigation and decision by the Committee on Standards, albeit only after an extensive prior process and where the conduct alleged is serious or prolonged, provides the authoritative and proportionate approach that will protect the interests of all parties.

This has been a helpful debate. I hope that the House will approve the motion so that the policy can come into effect.

Question put and agreed to.

Business without Debate

Monday 14th July 2014 Commons Chamber

Delegated Legislation

Monday 14th July 2014 Commons Chamber

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

With the leave of the House, we shall take motions 7 to 11 together.

Motion made, and Question put forthwith (Standing Order No. 118(6)),

Copyright

That the draft Copyright and Rights in Performances (Quotation and Parody) Regulations 2014, which were laid before this House on 9 June, be approved.

That the draft Copyright and Rights in Performances (Personal Copies for Private Use) Regulations 2014, which were laid before this House on 9 June, be approved.

Local Government

That the draft Local Audit (Delegation of Functions) and Statutory Audit (Delegation of Functions) Order 2014, which was laid before this House on 16 June, be approved.

Energy Conservation

That the draft Green Deal (Qualifying Energy Improvements) (Amendment) Order 2014, which was laid before this House on 16 June, be approved.

Children and Young Persons

That the draft Adoption and Children Act Register (Search and Inspection) (Pilot) Regulations 2014, which were laid before this House on 11 June, be approved.—(Mr Gyimah.)

Question agreed to.

Scottish Affairs

Monday 14th July 2014 Commons Chamber

Ordered,

That Mark Menzies be a member of the Scottish Affairs Committee.—(Geoffrey Clifton-Brown, on behalf of the Committee of Selection.)

Clocaenog Wind Farm (Vale of Clwyd)

Monday 14th July 2014 Commons Chamber

19:38

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

I would like to present a petition to the House concerning pylons that will come from the Clocaenog wind farms. The wind farms are located outside my constituency, but the pylons will lead to St Asaph in my constituency. One wind farm is in place. That is connected by underground cabling. However, four more wind farms are proposed and those will have overground cabling.

The petition states:

The Petitioners therefore request that the House of Commons urges the Government to encourage local authorities to ensure that planning inspectorates recognise and carefully consider local residents’ views when making planning permission decisions and further that the House urges the Government to encourage Denbighshire County Council to show the same consideration to residents’ views in relation to the development of the Clocaenog wind farm as it has in the development of other wind farms.

Following is the full text of the petition:

[The Petition of residents of the Vale of Clwyd,

Declares that Clocaenog wind farm is currently being developed; further that the Petitioners believe that all cables connecting the wind farm to the electricity sub-station should be underground so as to minimise the visual impact on this beautiful area, to minimise the health risks to residents, to limit the devaluation in property prices and to respect the democratic will of the people of Henllan, Cefn Meiriadog and surrounding areas who unanimously voted to endorse the placing of these cables underground; further that Tir Mostyn, the first wind farm near Clocaenog Forest, placed its cables underground; and further that the offshore wind farms off the coast of Rhyl also placed its cables from the seashore to St Asaph underground.

The Petitioners therefore request that the House of Commons urges the Government to encourage local authorities to ensure that planning inspectorates recognise and carefully consider local residents’ views when making planning permission decisions and further that the House urges the Government to encourage Denbighshire County Council to show the same consideration to residents’ views in relation to the development of the Clocaenog wind farm as it has in the development of other wind farms.

And the Petitioners remain, etc.]

[P001366]

VAT Relief (Talking Newspaper Associations)

Monday 14th July 2014 Commons Chamber

Motion made, and Question proposed, That this House do now adjourn.—(Mr Gyimah.)

19:39

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

I am grateful for the opportunity to raise the subject of VAT relief for talking newspapers. For the convenience of Members who may not be familiar with the concept of a talking newspaper, let me begin by explaining what they are and the important service that they provide to people who are blind or partially sighted, or who have some other disability that makes reading a newspaper difficult. There are 500 talking newspapers in the UK and Isle of Man. By and large they are small charities where a group of volunteers will read the contents of a local newspaper on to a cassette, CD or digital recording device. Those are then posted to registered listeners who listen to the recording and return the cassette or CD to the talking newspaper association in time for it to prepare the next edition, usually on a weekly basis.

It is important to emphasise the small, local and charitable nature of these associations. On average, each talking newspaper has 130 listeners and 34 volunteers, and they should not be confused with larger, national organisations that provide an excellent service of national newspapers, magazines and books for people who are registered blind or partially sighted. Their services are provided free of charge and they rely on small-scale local fundraising and grants to provide an income to cover the recording and distribution equipment and running costs.

I should also declare a family interest in this subject. More than 30 years ago, my father—Jim Stewart—and a small group of helpers set up the Hamilton Sound talking newspaper in the town in Scotland in which I grew up. He is still chairman of that today, and more than three decades later over 1,000 editions of the talking newspaper have been produced. I know that its listeners—a couple of hundred or so on average—have greatly valued the service. While national news can easily be accessed by a number of means, it is not always easy for people who are blind or partially sighted to obtain the local news that a local newspaper can provide.

I salute the work that volunteers up and down the country do in their communities to help often vulnerable people keep in contact with the outside world, and in this debate I wish to seek clarification and an update of the VAT rules that affect talking newspapers. For some time, talking newspapers have rightly been able to benefit from some financial assistance in providing their service—for example, they do not have to pay postal charges for the issuing or return of their products. In the 1986 Budget the then Chancellor, Lord Lawson, announced a number of VAT reliefs for charities. That included relieving charities from VAT on

“all recording equipment for talking books and newspapers used by charities for the blind”—[Official Report, 18 March 1986; Vol. 112, c. 178.]

After the 1992 Budget, the then Chancellor, Lord Lamont, extended the relief available to include

“repairs and maintenance of equipment used for talking books.”

The most recent guidance from Her Majesty’s Revenue and Customs—notice 701/1 from May this year—states:

“Charities and voluntary bodies caring for the blind and the severely visually impaired can obtain zero-rating for purchases of sound recording and reproduction equipment (or parts and accessories for such equipment) that has been designed or specially adapted for recording or reproducing speech for the benefit of such persons. In the case of reproduction equipment, zero-rating will not apply where the equipment is available for use by anyone other than the blind or severely visually impaired. The zero-rating also covers radios and cassette recorders purchased by charities for free loan to the blind, and the repair or maintenance of any equipment mentioned in this paragraph.”

There is, however, considerable confusion in the talking newspaper community about what is and what is not eligible for VAT relief. Part of that stems from the fact that the technology used by talking newspapers has changed considerably since the original VAT exemption in the 1980s and 1990s. At that time, an original tape recording of the edition was made and copied on to audio cassettes by a high-speed copier. Now, although a minority of talking newspapers still use that traditional method, approximately 80% produce digital recordings.

The confusion stems from the part of the guidance which states that

“zero-rating will not apply where the equipment is available for use by anyone other than the blind or severely visually impaired”.

The onus is on the manufacturer or supplier to come to an agreement with HMRC that the product is designed specifically for blind and partially sighted people. When purchasing sound equipment from a company, the talking newspaper must supply the company with a declaration for the benefit of Customs and Excise, stating that the equipment is exempt from VAT. The problem is that talking newspapers now use equipment such as computers, digital copiers, memory sticks and memory stick players that can be used by the general public and other businesses, and therefore attract VAT. Talking newspaper associations are finding that many companies are not willing to risk applying for a VAT exemption on those products. I received a number of comments from talking newspapers ahead of this debate, and a remark by Bob Finch of Colchester talking newspaper neatly summarises the point:

“Most suppliers just charge the VAT to cover their own backs. I am aware that Kings Audio and Laplock Technology are both selling their versions of memory stick players VAT free, having apparently convinced HMRC that these particular items are only ever going to be used by visually impaired people. I applaud them for doing that, but any other items they or other suppliers sell are charged because they could be used by non-disabled people.”

It is clear that many talking newspaper associations in the country are having to meet a VAT cost that they should not have to meet, given the spirit of the 1986 and 1992 measures, and it is a significant extra cost for what are often very small charities. Brian Sharp of the Forth Valley talking newspaper association told me:

“We have recently transferred all our listeners on to USB memory sticks from both cassette tapes and CDs. The total cost of the project was £11,542 which included £1,247 in VAT”.

Roughly £1,250 is small change for the Treasury but a hugely significant cost for the charity.

There is certainly an appetite in the talking newspaper community for a clarification of current VAT rules, and an updating of them to ensure that the spirit of the original provisions is reflected in new technology that talking newspapers increasingly use. I heard from Janelle Scotland, chair of the Association of Scottish Talking Newspapers, that advice on the matter from local HMRC offices around the country seems to vary, which adds to the confusion. Such a move would be supported by the Royal National Institute of Blind People, which stated:

“Advances in technology mean that most talking newspaper associations are no longer using the kinds of equipment that have historically been VAT exempt; the RNIB urges HM Treasury to extend VAT relief to cover the digital equipment now used to produce talking newspapers.”

I accept that there will always be a risk that VAT-free digital equipment could be misused, but we are talking about a comparatively small number of listeners in the country and a small number of associations. Would it not be acceptable for them to complete a VAT exemption per purchase of equipment outlining the proposed use? Under current postal arrangements the Royal Mail trusts talking newspaper associations to send mail free under the articles for the blind scheme only to blind or partially sighted people, but it reserves the right to carry out spot-checks to ensure that an association is adhering to the regulations. Could HMRC do something similar?

Another possible solution would be to allow talking newspapers to claim back VAT retrospectively. A potential problem is that many talking newspapers will not be VAT registered as their turnover falls way below the threshold, but surely some special arrangements could be made. Perhaps it could be done collectively through the national talking newspaper bodies in Scotland, England and other parts of the United Kingdom, rather than via each individual association.

At the very least, may I ask my hon. Friend to facilitate a meeting between herself, HMRC and representatives of talking newspapers associations to clarify both the current law and what items of equipment are and are not exempt? It is a muddle at the moment and most talking newspapers are small charities whose volunteers are not necessarily well-versed in the intricacies of fiscal policy. I received another good comment from Rob Pearman, from St Albans & District talking newspaper. He wrote:

“It is a problem when some of us are scared of HMRC and we do not actually feel secure on all aspects of the laws and regulations with which we have to struggle. As a child I went to a school where the school rules were headed ‘Ignorance of these rules shall not be taken as an excuse - it haunts me to this day!’”

If a change in the law is required to update the current regulations, I would like the Minister to take this as an early submission for the autumn statement and next year’s Budget. I very much doubt it would incur a significant cost to the Exchequer to bring the regulations up to speed in the original spirit. I am grateful to have had this opportunity to raise an issue that is of considerable concern to these wonderful charities that provide a valuable and much cherished service to some of the most vulnerable members of our communities.

19:51

[The Economic Secretary to the Treasury (Andrea Leadsom)]

I am grateful for the opportunity to speak in this debate. I would like to start by congratulating my hon. Friend the Member for Milton Keynes South (Iain Stewart) on his kindness and generosity in securing this Adjournment debate on a very important area of support for people who are vulnerable by virtue of being visually impaired. It is very important that we do all we can to support them. The Exchequer Secretary would normally respond to a debate on VAT. I am speaking on his behalf, but I will do my best to answer my hon. Friend’s questions.

The Government value the important contribution talking newspaper associations make to ensure that blind and severely disabled people can independently remain informed and up to date on current affairs. On the issue of tax itself, I reassure hon. Members that charities are at the heart of the Government’s ambition to build the big society, enabling people to play an active role in their community. To help support this, the Government provide support for charities primarily through more than £4 billion a year in tax reliefs, of which VAT relief makes up £300 million.

Reliefs from VAT are strictly limited under EU law. As hon. Members may know, when the UK joined the European Community in 1973 we successfully negotiated to keep our existing zero rates on items such as children’s clothing, most foods and physical books, newspapers and journals—a derogation from which most other member states do not benefit. Two zero rates of VAT are relevant to talking newspapers. First, a zero rate of VAT is applied to talking books and newspapers for the blind. However, this zero rate is limited strictly to specifically adapted magnetic tape and apparatus designed to reproduce speech for the blind and severely disabled people in our community. Many talking books and newspapers for the blind, as my hon. Friend pointed out, are no longer produced on magnetic tapes and so this relief cannot apply to them. EU VAT rules do not permit member states to extend the scope of existing VAT reliefs or to introduce new ones. As such, it is not possible to amend this zero rate to include talking newspapers that are not on magnetic tape.

My hon. Friend asked whether we can just change that. The European Commission is undertaking a review, including a public consultation, of member states’ application of reduced VAT rates. Among other matters, it is looking into the principle that similar goods and services should be subject to the same VAT rate, and that progress in technology should be taken into account in this respect so that the challenge of convergence between the online and the physical environment is addressed. This principle is regarded as an openness to consider a reduced rate for goods and services such as e-books and newspapers. However, if the Commission did decide to take this view, article 98(2) of the EU VAT directive, which currently excludes electronically supplied services from a reduced rate of VAT, would need to be removed. As most talking books and newspapers now use mainstream technology, I have to tell my hon. Friend that they cannot easily be distinguished from other sound reproduction equipment that is used by the general public. Talking books and newspapers for the general public do not benefit from a VAT relief and therefore attract the standard rate of VAT.

The EU has challenged and commenced infraction proceedings where it has identified member states that have allowed reduced rates, including zero rates, on general purpose products, or where they have extended existing reliefs to include them. However, the Government considered that it was important to ensure that talking books and newspapers for blind and disabled people continued to benefit from a VAT relief. Her Majesty’s Revenue and Customs therefore reviewed the legislation and considers that talking books for the blind could come under an alternative zero rate of VAT: group 12(2)(g) in schedule 8 to the UK Value Added Tax Act 1994, under relief for aids for the handicapped. The zero rate of VAT applies to talking newspapers and books if: they are supplied to a blind or disabled person for their personal or domestic use; or if they are supplied by a charity that makes them available for such use by blind or disabled people. This relief applies to items of equipment such as CDs and memory sticks for books and newspapers that are designed solely for use by a handicapped person. This relief is limited to supplies of physical goods and cannot be extended to downloaded newspapers where the supply is a digital service. This is, as I said, because article 98(2) of the EU VAT directive specifically excludes “electronically supplied services” from a reduced or zero rate of VAT.

Turning now to the progress in technology and electronic newspapers more broadly, EU VAT law does allow member states to implement reduced rates of VAT of no less than 5% for certain goods and services listed in annexe 3 of the EU VAT directive, at the discretion of the member states.

One of those reliefs is the supply of books on all physical means of support, newspapers and periodicals other than material wholly or predominantly devoted to advertising. This may sound like it should include electronic newspapers, but, as I mentioned, the EU VAT directive specifically excludes electronically supplied services from the reduced rates of VAT. This means that, where talking newspapers do not fall under the zero rate of VAT as an aid for a disabled person, the UK charges the standard rate of VAT, at 20%, on electronic newspapers and the zero rate of VAT on physical newspapers.

On the related and very important topic of electronic or e-books, many Members will probably be aware that, since 2011, France and Luxembourg have chosen to levy a reduced rate of VAT of 7% and 3% respectively to bring them in line with their VAT rates on physical books. This is creating competitive distortions to economic operators in other member states, and there has been pressure from the industry for the UK to reduce its VAT rate on e-books alongside them. The EU Commission, however, has begun European Court of Justice infraction proceedings against France and Luxembourg and has formally instructed them to apply their standard VAT rates to supplies of e-books. If the UK were to reduce or zero rate e-newspapers, it is extremely likely that we, too, would be infracted.

Furthermore, reducing the rate of VAT on e-books or e-newspapers would be likely to create borderline issues in the wider electronic services market because problems of definition could lead to a widening of the relief through legal challenge and industry changes. This would put revenue at risk in the UK market, which is currently worth over £2.5 billion a year.

The Government remain firmly committed to our ability to maintain the UK’s existing zero rates as we recognise their importance for social reasons. EU law does not permit member states to extend the scope of existing VAT reliefs or introduce new ones. Zero rating all talking newspapers that might be used by the general public, as well as by blind or disabled people, would be an extension of the relief. The EU Commission’s position is clear that talking newspapers, which do not fall under the existing zero rate of VAT, attract the standard rate, as they are electronically supplied services. The UK’s rates of VAT on talking newspapers are therefore in line with EU law and there is no intention to change that, other than in tandem with the Commission’s own review that I mentioned.

I hope that my hon. Friend the Member for Milton Keynes South will now have more clarity about when the zero rate of VAT can be applied to talking newspapers for blind and disabled people, and that he and other hon. Members will be reassured that we support the sector and that we will continue to do everything we can to support it.

Question put and agreed to.

20:00

House adjourned.