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Oral Answers to Questions
(10 years ago)
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Ms Margaret Ritchie (South Down) (SDLP)
1. What recent progress her Department has made on tackling Ebola in west Africa.
The Secretary of State for International Development (Justine Greening)
The United Kingdom is leading the international response to the Ebola crisis in Sierra Leone, from where I have just returned. We have already committed £230 million and delivered over 880 treatment and isolation beds. We have opened three laboratories, and we have doubled the number of burial teams.
Ms Ritchie
I thank the Secretary of State for her answer. The World Health Organisation believes that since February 2014 there have been nearly 18,000 recorded Ebola cases and 6,000 deaths. According to Dr Frieden, the director of the US Centres for Disease Control and Prevention, speed of response is the key to ending epidemics affecting Guinea, Liberia and Sierra Leone. In the light of her visit, will the Secretary of State indicate what further actions can be taken, notwithstanding what has already been done?
Justine Greening
Yes, of course. We will continue to deliver the promises we have made such as getting hospitals open and delivering extra beds. A key announcement I made during my visit over the past few days was to provide more protection for the many children affected by the crisis. Many of them are orphaned or themselves suffering from Ebola and needing to recover. There will be lots more support for them. I can assure the hon. Lady that as we are able to scale up the operation, we will reach more and more patients.
Sir Malcolm Bruce (Gordon) (LD)
I would like to thank, through the Secretary of State, the British personnel who are engaged in tackling the outbreak. Following up the question on the WHO, does she acknowledge that it did not respond quickly enough and that its mechanisms are not really fit for purpose? Will she press for a review of the workings of the WHO so that it can be more efficient in future?
Justine Greening
The right hon. Gentleman is right to say that we need to learn some lessons from how the WHO and the international community has responded to the crisis. Speed was of the essence, so I think there are lots of lessons to be learned. I had a chance to meet some of the amazing UK personnel working on our behalf, including some fantastic NHS health workers who are out there providing front-line care.
Keith Vaz (Leicester East) (Lab)
May I commend the Government for what they have done so far? How much of the money spent was directed towards projects to do with health awareness as opposed to dealing with the after-effects of Ebola?
Justine Greening
We have a several million pound programme that is focused particularly on so-called social mobilisation. It is about training community workers to go out into communities and talk to people about how they can take practical steps themselves to reduce the risk of catching Ebola. Of course, the work we are doing in putting in place safe burial teams, which are now burying 100% of bodies safely in the main western area zone and 95% across the country, is one of the key ways in which we can stop the infection from spreading further.
Mrs Caroline Spelman (Meriden) (Con)
The Secretary of State mentioned the toll on children in Africa—the number of Ebola orphans adding to the huge number of AIDS orphans. Will she join me in encouraging people at Christmas time to make a donation through British charities that work especially among the children of Africa?
Justine Greening
I certainly would. Two journalists from the Sunday Mirror accompanied me on my visit, and they are running an important campaign with Street Child, which is seeking to raise money to do precisely what my right hon. Friend suggests. We work with that charity, too, and we will continue to do more.
Debbie Abrahams (Oldham East and Saddleworth) (Lab)
2. What estimate she has made of the loss of tax receipts to developing countries by the use of tax havens by multinational companies operating in those countries in the last three years.
Nick Smith (Blaenau Gwent) (Lab)
4. What estimate she has made of the loss of tax receipts to developing countries by the use of tax havens by multinational companies operating in those countries in the last three years.
Andy Sawford (Corby) (Lab/Co-op)
6. What estimate she has made of the loss of tax receipts to developing countries by the use of tax havens by multinational companies operating in those countries in the last three years.
The Secretary of State for International Development (Justine Greening)
Tax avoidance is a significant challenge for developing countries, which is why the UK has led international action at Lough Erne and, more recently, in the G20 to help tackle the problem through capacity-building projects and through the implementation of international initiatives.
Debbie Abrahams
The EU is currently negotiating the anti-money laundering directive. What is the Secretary of State doing to ensure that this includes public registers and that the UK does not become part of a two-tier system of corporate transparency?
Justine Greening
As the hon. Lady will be aware, one of the key objectives of the G8 presidency, which we had last year, was about tax transparency. I am really proud that our Government have led the way in tackling issues such as base erosion and profit shifting. Rules that have been in place since the 1920s need to be updated for today’s modern corporate world. We are making big steps on that and big steps on transparency and beneficial ownership, and we will continue to play our role, leading the international effort to improve the rules so that we can get the tax due in the countries where the work has taken place.
Nick Smith
May I press the Secretary of State on this? Does she not accept that the overseas territories and Crown dependencies must go beyond a promise to implement the G20 principles, and actually introduce public registers of beneficial ownership?
Justine Greening
The hon. Gentleman is talking about G20 progress that was instigated by this Government when we held the G8 presidency. I am tempted to make the point that the Labour Government had 13 years in which to take steps in this direction, and entirely failed to do so. We took some important steps during our G8 presidency, and, as he will know, that involved the overseas territories. We are not saying that we have gone all the way down the path, but we are starting to move down it for the first time, and I think that the hon. Gentleman should welcome that. I assure him that we will continue to work to ensure that we bring the rest of the international community with us.
Andy Sawford
According to analysis by the ONE campaign, $1 trillion is siphoned from developing countries each year as a result of corruption, money laundering and illicit financial flows. What analysis have the United Kingdom Government conducted of the role of UK companies in that activity?
Justine Greening
As the hon. Gentleman will know, there are various estimates of how much this kind of activity costs developing countries, which is one of the reasons why we put it on our G8 agenda. I mentioned the work that is being done to reform international rules. My Department is also engaged in significant work to build capacity in developing countries, so that when the progress that we are starting to see becomes international, they will be in a position to take advantage of it. The HMRC capacity building unit, which I helped to set up along with colleagues in HMRC, will work directly with tax revenue authorities such as the one in Pakistan to help them to improve their tax collection. As for corruption, DFID will continue to increase its efforts, through the Met police unit that it funds, to ensure that we can take action if money laundering and the corrupt obtaining of assets are associated with United Kingdom institutions.
Mr Speaker
Order. Members must stand if they wish to ask a question. They must not simply gesticulate. I call Mr Barclay.
Stephen Barclay (North East Cambridgeshire) (Con)
May I return the Secretary of State to the issue raised by the hon. Member for Blaenau Gwent (Nick Smith)? As she will know, the Government of the 14 overseas territories were in London last week, and published action plans last year. The British Virgin Islands and the Cayman Islands, for instance, have delayed any action in relation to their own action plans for more than 300 days. When will we see any implementation of the commitments that they have made?
Justine Greening
As my hon. Friend has said, for the first time overseas territories have signed up to action plans, and the next step is to ensure that they implement them. In fact, a number of countries need to stand by the promises that they made and deliver on them. However, we are delivering on our own promises.
Anas Sarwar (Glasgow Central) (Lab)
I am sorry, but the Secretary of State can do better than that. We know that tax revenues amounting to three times the entire global aid budget are lost to developing countries every year, and that nearly a third of the estimated $32 trillion of private financial wealth that is held in tax havens comes from those countries. A year ago, the Prime Minister said that there would be a public register of beneficial ownership. That must include the overseas territories and Crown dependencies. By dithering and delaying, whose interests is the Secretary of State protecting?
Justine Greening
There was dither and delay for 13 years under the last Government. I do not think we need take any lectures from them, either on the closing of our domestic tax gap—which grew under Labour—or, indeed, on the closing of the international gap. The hon. Gentleman would do better to welcome all the work that this Government have instigated, not least the setting up of the HMRC unit which I mentioned, which is enabling our officials to give invaluable help and advice to tax institutions around the world.
Mr Gary Streeter (South West Devon) (Con)
As I get older, my memory becomes more and more feeble. I cannot remember any substantial action being taken on this issue in the 13 years before 2010. Can the Secretary of State help me with my memory?
Justine Greening
Unfortunately, there is nothing to remember, because so little progress was made. We welcome questions from Labour Members, because they give us a chance to point out that we are not only increasing the amount of funding for developing countries, reaching the 0.7% target, but working with those countries to support their so-called domestic resource mobilisation. We will do more of that work over the coming months and years.
Richard Burden (Birmingham, Northfield) (Lab)
3. What recent assessment she has made of the humanitarian situation in Gaza.
The Minister of State, Department for International Development (Mr Desmond Swayne)
Given that unemployment is at over 40%, nearly 60% of people have no secure access to food and three quarters have no access to safe water, 19,000 people still reside in United Nations Relief and Works Agency shelters, and 100,000 have been rendered homeless, the situation is dire.
Richard Burden
Am I right in thinking that in October the Minister at the donor conference said that a return to the status quo in Gaza was not an option? According to the latest Oxfam report, however, the number of truck-loads going in with essential materials to do the rebuilding he talks about is now less after the summer’s conflict than before. Is Israel in breach of UN resolution 1860 on Gaza access, and if so what will the Government do about it?
Mr Swayne
The Gaza reconstruction mechanism, in which we have invested heavily, had a faltering start and only 46 truck-loads were delivered in October. We are now up to 302 as of the beginning of this month. It is not good enough, and we are working for more, but it is the only game in town.
Andrew Percy (Brigg and Goole) (Con)
The situation in Gaza is of course made more dire by the actions of Hamas, which misappropriates hundreds of thousands of tonnes of concrete and uses it to construct 32 terror and murder tunnels. Can the Minister tell me what he is doing to ensure that Hamas does not similarly misappropriate aid that should be going towards ordinary Gazans?
Richard Fuller (Bedford) (Con)
5. What projects her Department is supporting in Nigeria to counter the effects of Boko Haram.
The Minister of State, Department for International Development (Mr Desmond Swayne)
My recollection is that we take this matter very seriously indeed with respect to—sorry, I have misappropriated the question. [Interruption.] I apologise, Mr Speaker
Boko Haram can only be defeated by action by the Nigerian Government on a security front and on a development front and by provision of leadership. We in DFID have doubled our programme of investment in the north-east of Nigeria and are working to that end.
Richard Fuller
I thank the Minister for that reply. The active targeting of schools by Boko Haram, and also in Peshawar this week, shows that there is no limit to the barbarism and depravity of such extremists. In tackling such extremists it is important that the security forces maintain civilised standards. Is my right hon. Friend aware of the investigations by Amnesty International and can he assure the House that no DFID projects inadvertently or indirectly harm people by lowering the standards of the security forces?
Mr Swayne
We take that report very seriously indeed. Human rights abuses exacerbate insurgencies. I can give my hon. Friend that assurance that we do not fund or support in any way the security forces that are responsible for those actions. Indeed, our programme of Justice for All—J4A—ensures that all Nigerians can have access to better justice and human rights.
Mr Tom Clarke (Coatbridge, Chryston and Bellshill) (Lab)
The Nigerian military have made considerable territorial gains in recent weeks. How can we build on that situation to ensure that there are free and proper elections next year?
Mr Swayne
We have a deepening democracy fund through which we are providing support for those elections next year. With respect to the advance of Government forces, we are providing intelligence and direct tactical training to the Nigerian army. The elections themselves must be a matter for the Nigerians, but we are providing the funding and the technical support.
Jeremy Lefroy (Stafford) (Con)
We heard recently in the all-party group on malaria and neglected tropical diseases, which I chair, of a very important DFID programme to counter severe malaria in northern Nigeria. Can my right hon. Friend assure me that this programme will be continued and that efforts by Boko Haram to stop such development work will not be countenanced?
Ann Clwyd (Cynon Valley) (Lab)
What happened to the 700 women and children who were abducted some months ago? There was a big fuss about that in the Chamber. What has happened to them and what is your Department doing about it?
Mr Speaker
My department is doing nothing about the matter, but I think the Minister’s is.
Mr Swayne
Of the girls who were abducted in Chibok, 219 remain missing. Since then another 300 have been abducted elsewhere. We are providing a joint intelligence cell, together with our allies in France, the United States and Nigeria, based in Abuja, and all the technical assistance that we can give.
Fiona O'Donnell (East Lothian) (Lab)
7. What steps she is taking to support the UN goal to end the use and recruitment of children in armed conflict by the end of 2016.
The Secretary of State for International Development (Justine Greening)
This Government support the work of several UN bodies, including the special representative of the UN Secretary-General for children and armed conflict, and DFID seeks directly to reduce the impact of conflict on children through our humanitarian efforts and work to build stable and peaceful societies.
Fiona O'Donnell
I welcome the Secretary of State’s answer. She could go further, though, if her Government would commit to the Lucens draft guidelines on the military use of schools, amend our military codes of conduct accordingly, call on other nations to do the same, and issue a clear and unambiguous prohibition against attacks on and military use of schools. Will she commit to that today?
Justine Greening
The hon. Lady raises an important point. We take the entire issue extremely seriously. That is why we provide funding for the Office of the Special Representative of the Secretary-General. I am happy to take the points that she has made, which I think reside within the Foreign Office in terms of policy, and get them followed up, and I am happy to meet her on the broader topic because we recognise how importance it is. As she has heard from my answers to other questions, the Department does a huge amount of work supporting children.
Dan Jarvis (Barnsley Central) (Lab)
It is the most marginalised children, such as those living in conflict-affected areas, who are most at risk of being out of school. Can the Secretary of State tell the House more about the steps that her Department is taking as part of the post-2015 negotiations to push for Governments to ensure that the most marginalised children benefit from the same educational opportunities as their peers?
Justine Greening
The hon. Gentleman is right. Whether in terms of children’s prospects of reaching their full potential or the issues of security and stability that investment in education long-term can address, that is a key part of the post-2015 process. I can assure him that we raise these issues strongly in our work to try to make sure that that framework can deliver for everyone on our planet and will leave no one behind.
Michael Fabricant (Lichfield) (Con)
8. What steps her Department is taking to reduce aid dependency by promoting small business start-ups in developing countries; and if she will make a statement.
The Minister of State, Department for International Development (Mr Desmond Swayne)
We are providing support for small and medium-sized enterprises and micro-businesses across our areas of responsibility, because they contribute so much to both employment and economic development.
Michael Fabricant
My right hon. Friend will know that it is hard enough, with some notable exceptions, to get women involved in entrepreneurial activities in this country. What is he doing to encourage women entrepreneurs in developing countries?[Official Report, 18 December 2014, Vol. 589, c. 5-6MC.]
Mr Swayne
We have provided some 29 million women with access to financial services, and we are supporting the provision of some £26 billion in commercial loans to some 50,000 businesses led by women. Last year at the conference we announced that we would provide support for mentoring for 100 women across north Africa.
Mark Lazarowicz (Edinburgh North and Leith) (Lab/Co-op)
It is important that businesses big and small across the world pay their workers a decent wage, yet Conservative MEPs in the European Parliament voted against the global development programme because it included a minimum wage. Is that the policy of the Government as well?
Mr Graham Allen (Nottingham North) (Lab)
T1. If she will make a statement on her departmental responsibilities.
The Secretary of State for International Development (Justine Greening)
This morning I returned from Sierra Leone, where I saw the latest British treatment centre to open, in Port Loko. As I have said, I announced new protection and support for children affected by the Ebola crisis, working with UNICEF. We are now providing 882 Ebola treatment and safe isolation beds across Sierra Leone, and I am incredibly proud of the work that our health workers, troops, soldiers and humanitarian staff are doing and will continue to do through the Christmas period. Alongside that, on 4 December the UK and Afghanistan co-hosted the London conference on Afghanistan.
Mr Allen
The Secretary of State will be aware that the refugee crisis in Syria, involving 10 million refugees, is probably the worst in our lifetime, yet this Government’s programme has taken in only 90 refugees in the past year. Will the Secretary of State look again at engaging with the United Nations programme and getting more of those people out?
Justine Greening
I have spoken directly with the United Nations High Commissioner for Refugees lead, Antonio Guterres, about this. We also have discussions with our Home Office colleagues on the progress of that scheme. Our aim has been to help people to do what they want to do, which is to get support where they are, outside Syria, but also to have the prospect of returning home, which is what the overwhelming majority want to do.
Pauline Latham (Mid Derbyshire) (Con)
T2. Will the Secretary of State tell us what her Department has done to address the serious and well-documented allegations of bribery and violence committed by SOCO International in the Virunga national park in the Democratic Republic of the Congo?
Justine Greening
We are aware of those serious allegations. I expect SOCO, as a British-listed company, to adhere to the highest standards. In June this year, SOCO and the WWF announced that it would complete the existing programme of work at Virunga and then not undertake or commission exploratory or other drilling within the national park unless UNESCO and the Government of the DRC agreed to it. [Interruption.]
Mr Speaker
Order. There is far too much noise in the Chamber. It is quite difficult to hear the Secretary of State’s replies. We want to hear them and the questions.
Mary Creagh (Wakefield) (Lab)
The Prime Minister co-chaired the United Nations High Level Panel on sustainable development goals, yet last month Tory MEPs joined forces with UKIP to vote against the sustainable development goals to tackle climate change, tax avoidance and inequality. Will the Secretary of State join me in condemning them for doing that?
Justine Greening
The hon. Lady is right to point out that our country and our Prime Minister have played a leading role in helping to shape the debate and to create a successful post-2015 framework that will include a sustainability theme as well as tackling the things that undermine development, such as problems with the rule of law and corruption.
Mary Creagh
I notice that the Secretary of State failed to condemn her Tory colleagues in the European Parliament for that vote. The typhoon that hit the Philippines nine days ago reminds us of the threat that climate change poses to the world’s poorest people. She is spending £2.4 billion of British taxpayers’ money on helping vulnerable people to adapt to climate change, yet neither she nor any Minister from her Department attended the Lima climate change conference last weekend. Why on earth not?
Justine Greening
The hon. Lady will be aware that the Government were represented by the Secretary of State for Energy and Climate Change. I should also like to update the House. Since Typhoon Haiyan hit the Philippines last year, we have done a huge amount of work with the Government there, and that is one of the reasons that they were better prepared to cope with the storm that came in recently. I am proud of the work that our DFID staff have done. [Interruption.]
Mr Speaker
Order. We need some respectful quiet for a military man. I call Mr Robathan.
Mr Andrew Robathan (South Leicestershire) (Con)
T3. Following the appalling atrocity in Peshawar yesterday, will my right hon. Friend pledge that any aid that we give to Pakistan will be directed towards improving governance, ending corruption and fighting the root causes of radicalisation in madrassahs and elsewhere?
Justine Greening
I can tell my right hon. Friend that our programme is very much focused on enhancing the stability of Pakistan, and that one of our largest efforts relates to education, which in the long term provides one the best assurances of stability. He will be aware that we work directly with the Pakistan tax revenue authority to ensure that tax that is due can be collected. That is a key way in which we can tackle corruption.
Dan Jarvis (Barnsley Central) (Lab)
T6. Yesterday’s shocking events in Pakistan illustrate that children are not safe from violence even when they are in school. UNICEF UK has highlighted the fact that a child dies from violence somewhere in the world every five minutes. Will the Secretary of State seek to secure a global target to end violence against children in the new set of sustainable development goals, so that children around the world will no longer fear horrendous acts of violence such as the one we saw yesterday?
Justine Greening
I should also say that I send my deepest sympathies to the victims and their families who have been affected by this terrible tragedy in Pakistan. It is unthinkable that so many children could have been caught up, deliberately, in a terrorist act of this nature. I assure the hon. Gentleman that the work the Government are doing is very much aimed at enhancing the protection of children. Only yesterday, I announced support for orphans and children affected by the Ebola crisis, but it is part of a much bigger policy agenda and investment that we undertake to make sure we support children.
Charlie Elphicke (Dover) (Con)
T4. What steps is the Department taking to reduce the number of refugees attempting to flee their home countries?
Justine Greening
We rightly use development assistance to build up the institutions and the conditions that minimise the types of conflict, instability and state failure that lead people to becoming refugees and internally displaced in the first place.
Oliver Colvile (Plymouth, Sutton and Devonport) (Con)
Q1. If he will list his official engagements for Wednesday 17 December.
The Prime Minister (Mr David Cameron)
I am sure the whole House will join me in condemning the outrages that have shocked the world in recent days. The siege of the café in Sydney ended in tragedy but was accompanied by heroism so typical of that great nation, and we all grieve with the Australians today. What happened several thousand miles away in a school in Pakistan is utterly heartbreaking: a massacre of the innocents that has left the world numb. The world stands, head bowed, with Pakistan today. Words can comfort but words cannot defeat the men of violence, so let this be the moment when the whole of Pakistan and every nation come together and say, “Enough. We will act together to defeat this evil in our midst.”
I am sure the whole House will want to join me in sending our warmest Christmas wishes to all our armed forces deployed across the world, in particular, to those in the middle east, Afghanistan and west Africa. We are for ever indebted for the sacrifices they make on our behalf.
Oliver Colvile
May I associate myself with my right hon. Friend’s comments on the evil atrocities that took place in Pakistan and in Australia, and with the best wishes to our armed forces, who may be serving abroad?
Today’s unemployment figures showed that in the last quarter the south-west was the region with the largest increase in employment in the United Kingdom. To continue to realise its full economic potential and to deliver the city deal, does my right hon. Friend agree that Plymouth needs a faster, better and more resilient railway line, as laid out in the south-west rail taskforce’s three-point plan, which was the discussion last week with my hon. Friend the Member for South West Devon (Mr Streeter)?
The Prime Minister
My hon. Friend has campaigned over and over again for the important improvements in these rail links, and he knows what is being done to help the south-west in that regard. I received a presentation from the taskforce, and we are going to take forward each of the three points in its plan in the work we do in future, to make sure that there is real resilience and that there are better services for people in the south-west. On the issue of unemployment, the figures in the west country are welcome. In his constituency the claimant count has now fallen by 42% since the election. What these figures show nationally is employment up; unemployment down; and the claimant count falling for the 25th consecutive month. What is an important moment for our country is that unemployment is now below 2 million and wages are rising faster than inflation—something I am sure will be welcomed across the House.
Edward Miliband (Doncaster North) (Lab)
I want to join the Prime Minister in paying tribute to those murdered in the appalling massacre in Pakistan. Even as we have become accustomed to tragic events, this slaughter of innocent children in their classrooms has shocked the world. We stand in solidarity with the grieving families and the people of Pakistan, and in the fight against terrorism. I also join the Prime Minister in condemning the sickening terrorist attack in Sydney, and our condolences go to the families of those who died and to the Australian people. I also, like, the Prime Minister, pay tribute this Christmas to all our troops serving around the world; they do our country proud and they show the utmost courage and bravery.
The independent Office for Budget Responsibility, established by the Chancellor to give independent expert advice, claims that his plans take
“total public spending to its lowest share of”—
national income—
“in 80 years.”
Why does he believe the OBR has joined the BBC in a conspiracy against the Conservative party?
The Prime Minister
First, I welcome what the Leader of the Opposition said about the atrocities that have taken place. Can I also welcome his welcome for the Office of Budget Responsibility? We still remember the days of the fiddled forecasts, the fake figures and all that we had to put up with. If he is going to quote the OBR he might want to read the complete quote. Let me do that for the benefit of the House. It says about our spending plans that the closest equivalent of the national accounts implies that by 2019-20 day-to-day spending on public services
“would be at its lowest level since 2002-3 in real terms.”
Now, 2002-03, in my memory, was after five years of a Labour Government, when the right hon. Gentleman was an adviser in the Treasury. Presumably he is now going to tell us that it was a time of appalling poverty and deprivation, but I do not seem to remember that that was the message at the time.
Edward Miliband
The right hon. Gentleman has spent four years saying that we spent too much; now he is saying that we spent too little. The OBR says—and this is the full quote— that it takes total public spending
“to its lowest share of national income”
in 80 years. Is he really saying that it is wrong about the proportion of national income?
The Prime Minister
The percentage of national income will be roughly the same as it was in 1999 after two years of Labour government. The fact is, after seven years of economic growth we should have a surplus; we should fix the roof when the sun is shining. Is the Labour leader really saying that he does not think that we should run a surplus ever?
Edward Miliband
If the right hon. Gentleman is just a little bit patient, in four months’ time he will get to ask the questions and I will get to answer them. He knows what has happened—the mask slipped in the autumn statement. He has been revealed for who he really is. Let us talk about the scale of the cuts to get to the 1930s vision: they are over £50 billion—more than the entire amount that we spend on schools, half of what we spend on the NHS, and significantly more than in this Parliament. Is he really pretending that cuts on this scale will not do massive damage to front-line services?
The Prime Minister
Of course we have to make difficult decisions. We have done so every day since taking over from the shambles that we inherited. Everyone can now see that the right hon. Gentleman’s pretence, which lasted for about one week, of caring about the deficit is over. This is what the Institute for Fiscal Studies says about his policy, “Under a Labour Government…there would be much more borrowing, and therefore” more “government debt”. Labour has not learned a single thing from the last four years: more borrowing, more debt, more taxes—all the things that got us into this mess in the first place.
Edward Miliband
The right hon. Gentleman is borrowing £207 billion more than he planned, and he has broken his promise. The difference is that we will cut the deficit every year—he wants to go back to the 1930s. If that was not bad enough, he has £7 billion of unfunded tax cuts on top. Before the last election, he said that
“you can’t talk about tax reduction unless you can show how it is paid for, the public aren’t stupid”.
What is it going to be: further cuts in public services or a rise in VAT?
The Prime Minister
What this Government have shown is that if you get on top of the national finances and if you grow the economy you can cut taxes for 26 million people. It is interesting that, on this of all days, not a word from the right hon. Gentleman about the fall in unemployment. That is the truth. Remember the predictions: the Opposition told us that there would be no growth, then there was growth. They told us that there would be no jobs, then there were jobs. They told us that the jobs would not have pay ahead of inflation; now the jobs have pay ahead of inflation. They told us the deficit would go up; the deficit has come down. They have got absolutely nothing to say about the economy because they have been wrong on every single count.
Edward Miliband
The right hon. Gentleman is crowing that everything is fixed. It may be fixed for his Christmas card list, but it is not fixed for far too many people in this country.
The right hon. Gentleman did not really answer the question on VAT, did he? This is what he said before the last election on 5 April 2010: “We have…no plans” to put up VAT. Barely two months later he put up VAT from 17.5% to 20%. He has £7 billion of unfunded tax cuts, a deficit plan that he cannot meet, and we know that he has got form. Will he now categorically rule out a rise in VAT?
The Prime Minister
We do not need to raise taxes because we have a plan for efficiencies in spending. It is the Labour party that does not have a plan. The right hon. Gentleman asks what has changed for real people over the past year, and I will tell him: 588,000 people who did not have a job last year have one this year. Long-term unemployment has fallen. Youth unemployment has fallen. You might have thought that the Labour party would welcome those things. It is Christmas, so we should all enter into the Christmas spirit. I have had my Christmas present a little early, because I have here the document being sent to every Labour MP. In case they have not had time to read it, let me advise them that if they go to page 17—[Interruption.] Be patient. It is there in black and white: on managing the economy, the Conservatives have a 17-point lead. Thank you.
Edward Miliband
I hope that over Christmas the Prime Minister will get to reflect on his year. He has lost two Members of Parliament to UKIP, he lost 26-2 in Europe, and he brought a whole new meaning to the phrase “conviction politician” when Andy Coulson went to jail. The truth is that he has given up on compassionate conservatism. They have been exposed for who they really are. His plan for the 2020s is to go back to the 1930s. It is not about balancing the books; it is about slashing the state. In just four months’ time that will be the election choice.
The Prime Minister
What this has shown is that on a day when it has been shown that unemployment has fallen, inflation is down and our economy is growing faster than any other major economy in the western world, the right hon. Gentleman has absolutely nothing to say. I almost feel sorry for Labour MPs. They cannot talk about the deficit, because it has fallen. They cannot talk about growth, because it is rising. They cannot talk about jobs, because we are increasing them. They cannot talk about immigration, because they have been told not to. They cannot talk about their leader, because he is a complete waste of space. No wonder for Labour MPs this year it is a silent night.
Richard Drax (South Dorset) (Con)
Q2. Thank you, Mr Speaker. [Interruption.]
Richard Drax
First, may I concur entirely with the Prime Minister’s words about the appalling tragedies that have unfolded around the world?
Bearing in mind the continuing success of our long-term economic plan, can my right hon. Friend please reassure the House that there will be no further cuts to our armed forces under a future Tory or coalition Government?
The Prime Minister
I absolutely agree with my hon. Friend that we can have a strong defence budget and strong defence forces only if we have a strong economy and a clear long-term economic plan. Our defence budget is the biggest in the EU and the second largest in NATO, and we meet the guideline of 2% of GDP. I can tell him that, because of the success of our economic plan, we are able to commit to over £160 billion of investment in equipment and equipment support over the next 10 years. That is why we will see the aircraft carriers, the Type 45 destroyers, the future frigates, the A400Ms and the hunter-killer submarines. We are seeing incredible equipment rolling off the production lines in our country to help keep us safe.
Mr Nigel Dodds (Belfast North) (DUP)
The terrible slaughter of the innocents in Pakistan yesterday shocked the world and is another example of the obscene atrocities being visited upon children in various parts of the world by these barbaric forces. Another example was the attack on the 200 schoolchildren who were abducted in north-east Nigeria in April of this year. At the time, the Government and other Governments pledged their support to do what they could to assist in the hunt for those children. What reassurances can the Prime Minister provide on that and on the commitment that British experts will assist?
The Prime Minister
In all these cases, we see what expertise and assets we can bring into play to help Governments who are trying to combat these problems. In Nigeria, for a period, we lent the expertise of our fighter jets, with their RAPTOR pods, in order to provide imaging to try to help find the Chibok girls, and we continue to work with the Nigerian Government in every way we can. With Pakistan, again, we believe that the Pakistan Government must confront terrorism in all its forms, and they are taking steps to do that. I think today is the day when we should redouble our support and our efforts, and the whole world should do the same, to say that if the Pakistan Government want to continue to act to root out terror—and none of this can be justified—they have the support of the whole world, Britain included.
Neil Carmichael (Stroud) (Con)
Q3. Will the Prime Minister join me in thanking businesses, schools, my Festomane team and the college for organising the week-long festival—week long—of manufacturing and engineering in my constituency, which was opened by the Prince of Wales? Does my right hon. Friend agree that by focusing on innovation and productivity this Government will deliver more exports and higher standards of living?
The Prime Minister
I certainly join my hon. Friend in that. People might know that this is an annual week-long festival, championed by him, that showcases local manufacturing success stories. I remember that when I visited his constituency we watched a 3D bike being printed in metal—it was extremely impressive. We need to continue with the long-term plan, which is delivering a more balanced recovery, with manufacturing growing, as well as construction and services. Our commitments to increasing the number of apprentices, to helping companies with research and development and to keeping tax rates low are all delivering a very strong manufacturing success rate for Britain.
Dame Tessa Jowell (Dulwich and West Norwood) (Lab)
Millions of people will work extra hours this Christmas in difficult and often low-paid jobs so that they can send money to relatives living abroad. Their remittances to sub-Saharan Africa alone account for more than donor aid, but their money transfers will be hit by fees and charges often as high as 15%. Five years ago, the G8 committed to reducing this transfer tax to 5%. Will the Prime Minister therefore join me in calling on the transfer companies to cut their charges for Christmas as a first step to meeting the G8 promise to families in some of the poorest countries in the world?
The Prime Minister
The right hon. Lady is absolutely right to highlight the importance of remittances. The amount of money that goes from our country, in the form of remittances, to countries such as Somalia and others in sub-Saharan Africa in desperate need actually outweighs significantly the aid we are able to give to those countries. So yes, we should look, and we are, at every way we can to help these remittances take place. There have been problems in the past with making sure that we apply measures on money laundering and other potential issues to them, but we are looking hard at what we can do to keep the charges down.
Mark Garnier (Wyre Forest) (Con)
Q4. One of the characteristics of the decade leading up to the financial crisis was the £1 trillion increase in household debt. Will my right hon. Friend assure the House that no future long-term economic plan will be financed by a debt bubble inflated on the backs of hard-working households?
The Prime Minister
My hon. Friend is absolutely right. One of the changes we have made since the crash is to put in place proper arrangements for the Bank of England to call time on the level of indebtedness in the economy and to make sure that financial regulation, including regulation of the mortgage market, for instance, is properly put in place. That is one of the important lessons. I have to say to Labour Members that one of the other important lessons is that when you have had a long period of economic growth you should be trying to pay down your debt and aiming for a surplus. That is what fixing the roof when the sun is shining is all about.
Mr Nicholas Brown (Newcastle upon Tyne East) (Lab)
Q5. I welcome the fall in unemployment, but it is still too high in the north-east of England. Will the Prime Minister tell the House, and my unemployed constituents, who are the principal candidates for working-age benefit cuts?
The Prime Minister
Let me join the right hon. Gentleman in welcoming the fall in unemployment; it has fallen in every region of the country over the past year. In the north-east over the past year, unemployment is down by 11,000, and that is welcome. In terms of addressing the costs of welfare, I think we should be very frank about this, as I was discussing, calmly, earlier with the Leader of the Opposition. Whoever is Prime Minister after the next election is going to have to make public spending reductions. We have a choice: whether we leave the welfare bill as it is, or whether, like Labour Members, we vote this afternoon to add £2 billion to the welfare bill—that is what they are talking about this afternoon: £2 billion on welfare—and then have to take that money out of the Education Department, or the Health Department, or policing. We think we should not do that; we think, yes, there are reductions in welfare that can be made. We will make them, and that will keep taxes down and make sure that we can have good public services.
Richard Fuller (Bedford) (Con)
Q6. For people starting their careers, newly married couples or others, the prospect of owning their first home is a much desired but very difficult step. What are the Government doing to help young people in my constituency make that positive move?
The Prime Minister
There are two vital steps that we can take. The first is to go on backing the Help to Buy scheme, which has helped thousands of people in our country—I think over 70,000 people now. It enables people who are working hard, who earn a decent salary and who can afford the mortgage payments to take out that mortgage and buy that home because they do not need such a big deposit. That is the first thing we should do, and we shall continue with that.
The second, as I announced on Monday, is that we want to build starter homes that are 20% below the market price. These should be homes not for rent, but that young people can buy. They will be reserved for people under the age of 40. Again, this is for people who work hard, and who want to get on and do the right thing for themselves and their families. Under a Conservative Government, they will have homes they can buy.
Derek Twigg (Halton) (Lab)
I was contacted at the weekend by a constituent who told me that a fall left his 78-year-old mother bleeding on the kitchen floor and that it took almost an hour and a half for the ambulance to attend. Is that not indicative of the health service under this Government? What is the Prime Minister going to do to ensure that pressures on ambulance services are eased?
The Prime Minister
What is indicative of the NHS under this Government is the fact that there are 1,700 more paramedics and 200 more ambulances than when we came to power. The reason for that is we did not listen to the Labour party, which said that it was irresponsible to increase health spending; instead, we put £12.7 billion into the NHS. Where any ambulance trust falls down, that is a matter of serious regret and should be looked into very carefully. I will look into this case, as I would with any other.
Stephen Metcalfe (South Basildon and East Thurrock) (Con)
Q7. Does my right hon. Friend agree that it is not unhelpful to discuss the concerns of voters in Basildon and Thurrock about border controls and immigration? Anyone who thinks that is out of touch, and perhaps should be moved on.
The Prime Minister
My hon. Friend is right. Our job as elected politicians is to respond to people’s concerns and to address them. This is why I fear for the Christmases of Labour MPs. What are they going to talk about? This document says immigration. That is out of the question: they cannot talk about that. On the figures today, there is not much point talking about unemployment, because it is plummeting. They have got nothing to say about the deficit. They spent precisely one week telling us the deficit mattered before pitching up today and spending £2 billion on welfare. I think they will want to skip over leadership issues quite quickly. It is going to be a very difficult time for them.
Nia Griffith (Llanelli) (Lab)
I do not know whether the Prime Minister has received any Christmas cards featuring husky dogs, but will he tell us whether he agrees with his right hon. Friend the Member for North Shropshire (Mr Paterson), who has said that the UK’s groundbreaking Climate Change Act 2008 should be scrapped?
The Prime Minister
I have not checked all my Christmas cards, but I do not think I have so far had the one the hon. Lady suggests. I spent an hour and three-quarters in front of the Liaison Committee yesterday discussing issues of climate change. The legislation we have in place is delivering cuts in carbon emissions. Under this Government, we have seen the world’s first green investment bank—beating the rest of the world in doing that—and we have doubled the amount of investment going into renewable energy compared with the previous two Parliaments. That is what is happening under our Government.
Mr David Burrowes (Enfield, Southgate) (Con)
Q8. Will the Prime Minister confirm that, owing to the long campaign led by my hon. Friend the Member for Enfield North (Nick de Bois) and, of course, the Government’s long-term economic plan, my constituents can have extended urgent care this winter, and can look forward to the rebuilding, at long last, of Chase Farm hospital in the new year?
The Prime Minister
I know how hard my hon. Friends have worked for this outcome. I am happy to say that Enfield clinical commissioning group has announced an extension to the opening hours of Chase Farm urgent care centre. This will be in place until the local urgent care review reports. Further, I can confirm that the Government have set aside £230 million for the redevelopment of the Chase Farm site. That is very good news for the people of my hon. Friend’s constituency and his borough in London. What we are doing, because we have a long-term economic plan, is investing in local health services.
Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab)
Today, there are 2,500 fewer nurses in our NHS than in May 2010. Why?
The Prime Minister
Obviously the hon. Gentleman has not been studying either the documents he gets sent by his own party or the figures. Today, actually, there are new figures out on the NHS, and I am delighted to give him the new figures. We were saying that there were 2,000 extra nurses under this Government. That was wrong: there are 3,000 more nurses under this Government. We were saying until very recently that there were 7,000 more doctors under this Government. I am ashamed to say that was wrong, too: the figure is 8,000 more doctors under this Government. The NHS is performing well because we have put the money in and made the reforms.
Sir Tony Baldry (Banbury) (Con)
Q9. May I commend to my right hon. Friend some advice from Karl Marx, who, as European correspondent of the New-York Tribune, observed that there were“vital interests which should render Great Britain the earnest and unyielding opponent of the Russian projects of annexation and aggrandisement.”He went on to say that in“the arrest of the Russian scheme of annexation…the interests of…Democracy and of England go hand in hand.”Does my right hon. Friend agree that for the United Kingdom, Europe, the west and indeed the whole world, one of our most important foreign policy priorities for 2015 should be to see that Russia behaves, as one would expect a member of the Security Council to behave, in the interests of international law?
The Prime Minister
I very much agree with my right hon. Friend. I have not spent as much time studying Karl Marx as he has, or perhaps even as the Leader of the Opposition has—I do not know what goes on in Camden these days.
In this respect, Karl Marx was right that the interests of the United Kingdom and democracy go together. We should stand up very firmly against the Russian aggression that has taken place, and we led the way in Europe in making sure that there were sanctions. What the combination of the lower oil price and the sanctions is showing is that it is not possible for Russia to be part of the international financial system but try to opt out of the rules-based international legal system. That is what is being demonstrated, and we should keep up the pressure.
Douglas Carswell (Clacton) (UKIP)
Q10. The levy control framework—the total cost added to energy bills and taxation by green targets—will rise from £2.3 billion in 2012 to £9.8 billion in 2020, at a time when many households are struggling to heat their homes. Does my hon. Friend think that is fair?
The Prime Minister
The levy control framework has been fixed, and it sets the overall amount of investment that can go into renewable energy schemes, many of which are providing jobs for constituencies up and down the country—often particularly those on the east coast of our country, not least in Hull, where an enormous amount of investment is going in. I welcome that investment, and I am not sure what the hon. Gentleman’s view is.
Mr Kenneth Clarke (Rushcliffe) (Con)
Will the Prime Minister confirm that if he and the Chancellor deliver their plans for the economy, they will take public spending back to the level that was being delivered by a former Labour Chancellor, but only because he was bound by an election pledge to stick to my economic plan, which he therefore inherited from a Conservative Government?
The Prime Minister
My right hon. and learned Friend gives us a very important historical perspective. It comes back to the point that the Opposition now seem to be basing their entire economic policy on some throwaway remark on the BBC at about 10 past 6 on a Monday morning. The truth is, what is envisaged is getting public spending back to the level where it was in 2002, when the Leader of the Opposition was sitting in the Treasury. I am afraid that his whole idea, like all his economic policies, has collapsed within five minutes.
Michael Connarty (Linlithgow and East Falkirk) (Lab)
Q11. The most recent OECD report, No. 163, on income inequality, shows that the UK economy would be 20% bigger if tax policies had redistributed income to the bottom 40% of citizens. Can the Prime Minister resist the temptation to waffle and consider seriously his policies and those of Chancellor Scrooge over his five years, of rewarding the rich with tax cuts and hammering middle and low-income people with rises in the cost of living, not only—
The Prime Minister
I was just about getting the hang of it. The problem with the Labour party’s attemptive narrative is that it simply is not true. Labour Members talk about inequality, but inequality is lower than it was at the election. They talk about poverty, but there are 600,000 fewer people in relative poverty than there were at the election. They talk about child poverty, but there are 300,000 fewer children in relative poverty than at the election. This afternoon we will be talking about children, and there are 390,000 fewer children in households where no one works than there were in 2010. Those are the facts. They may be inconvenient, but Labour ought to have a look at them.
John Glen (Salisbury) (Con)
Q12. Last week, my constituents, charity workers Alex and Becky Ewing, faced a tax bill of more than £8,000 as they moved into their first home. As reported in the excellent Salisbury Journal, Mr Ewing declared that he was “blown away” by the Chancellor’s statement and will be giving some of the £4,500 stamp duty that he unexpectedly saved to local charities. What message does last week’s announcement send to first time buyers this Christmas?
The Prime Minister
I am grateful to my hon. Friend. The message that the autumn statement sends is that we are on the side of people who work hard, want to get on, and who want to own their own flat or home. We have cut stamp duty for those families so that they can afford those houses. What a contrast with the Labour party, which wants a new homes tax.
Sheila Gilmore (Edinburgh East) (Lab)
Q13. My constituent who is paying £12 a week out of an income of £72 a week on the bedroom tax was less than impressed to find out that annual spending on housing benefit is now £4 billion higher than it was in 2010. When will this Prime Minister tackle the real causes of the increase in spending on housing benefit, which are low wages and high rents?
The Prime Minister
The point is that the Labour party has opposed every single change to welfare and housing benefit, and this afternoon Labour Members will vote in this house for an extra £2 billion of welfare spending—all that in the week when they are meant to be telling us how much they care about the deficit. It is completely incoherent, and that is why the British public will never trust the Labour party with the economy again.
Andrew Bingham (High Peak) (Con)
Q14. The recent announcement about the building of the Glossop spur, and the consultation to extend the bypass around Tintwistle, has been widely welcomed across my constituency. There is, however, some scepticism about it actually happening, given that the previous Labour Government shelved their scheme in 2009. Will my right hon. Friend reassure me and my constituents that a future Conservative Government can be relied on to deliver that scheme?
The Prime Minister
I can certainly give my hon. Friend that assurance. I know that he has campaigned tirelessly to improve roads in his High Peak constituency, and the trans-Pennine routes are vital. We can give that assurance because we have a long-term economic plan that is delivering the economic growth that we need and seeing our deficit come down. Because we have made that success, we can commit to these road schemes.
Liz McInnes (Heywood and Middleton) (Lab)
Q15. What steps the Government are taking to protect older people from ill health caused by cold and badly insulated homes.
The Prime Minister
The Government are using a range of measures, including cold weather payments, the warm home discount, and an increase in pensions. We will improve the warmth of 1 million homes by March 2015. That provides real help to older people by taking money off their bills and insulating their homes to ensure that they are able to keep warm this winter.
Liz McInnes
That is an interesting response, but my constituent William Sullivan has written to me to say how appalled he is that last year more than 18,000 people in England and Wales died simply because of the cold. What guarantee can the Prime Minister give me that no more of my constituents will suffer in the cold this winter for want of a properly insulated home?
The Prime Minister
Every excess winter death is a tragedy, and 18,200 deaths last year was too many. However, that is half the level of excess winter deaths in 2008-09, when the Leader of the Opposition was the Energy Secretary. We will continue with the long-term patient work of the warm home discount, keeping the winter fuel and cold weather payments, and schemes to insulate people’s homes. That is the right way forward.
Sir Malcolm Bruce (Gordon) (LD)
Will the Prime Minister confirm that NHS spending under the coalition Government has risen by 4% in real terms? That has been passed on to Scotland, where spending has in fact been cut by 1%. Is he also aware that Grampian has a £70 million two-year shortfall in funding? Consequently, the responsibility for the crisis in the health service in the north-east of Scotland lies firmly with the Scottish Government, led until a few weeks ago by Alex Salmond, the MSP for Aberdeenshire East.
The Prime Minister
My right hon. Friend is absolutely right. We have increased spending by £12.7 billion. That translates into a real-terms increase. Scotland and Wales have had the extra money to spend, but Labour in Wales chose to cut the NHS rather than to invest in it, and in Scotland the SNP Government have not translated the full amount of money. That is why, when we look at figures for such things as accident and emergency, yes, we need to do better in England, but our performance is still well better than it is in Wales, Scotland, or, indeed, in Northern Ireland. The moral of this story is that you need a long-term economic plan and a Conservative-led Government to deliver these advances.
Mr Speaker
Points of order come after statements, and we have a statement. The hon. Gentleman ought to know that by know, with the greatest of respect. We will come to the statement in a moment.
Al-Sweady Inquiry Report
(10 years ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Secretary of State for Defence (Michael Fallon)
With permission, Mr Speaker, I would like to make a statement on the report into the al-Sweady inquiry into allegations that British forces tortured and executed up to 20 Iraqi men on 14 and 15 May 2004, and mistreated nine others between 14 May and 23 September 2004.
I am today laying before the House the independent report published this morning by Sir Thayne Forbes, the chairman of the public inquiry into these incidents. I am grateful to Sir Thayne and his team for their painstaking work, and for producing a report that puts to rest once and for all these shocking and, as we now know, completely baseless allegations. As I know Sir Thayne will acknowledge, the Ministry of Defence has provided unstinting support for his inquiry. During 169 days of hearings, Sir Thayne heard evidence from 55 Iraqi witnesses, 222 current and former service personnel and four expert witnesses. He also considered the written statements of a further 328 witnesses. His findings are incontrovertible.
It was alleged that, following a planned and co-ordinated ambush of British troops by heavily armed Iraqi insurgents around the Danny Boy permanent vehicle checkpoint on the main road between Basra and al-Amarah, British service personnel captured up to 20 Iraqi men alive, took them back to Camp Abu Naji, and then tortured and killed them in cold blood. These are allegations of the most serious nature and they are untrue.
The allegations have changed several times over the years. This is how Mr Phil Shiner, of the firm Public Interest Lawyers, presented them at a press conference in 2008:
“What you have heard is evidence that these 5 survivors have witnessed, seemingly in three separate venues at close hand:
The execution of up to 15 men
Between 4 and 5 of these executions involving shots at close range and the remainder some sort of strangulation or throat cutting
Some of these executions preceded by torture or mutilations that are so horrific that our clients could not describe the prolonged screaming without breaking down.”
Today it has been confirmed that British soldiers did not carry out the atrocities falsely attributed to them. Sir Thayne deals unequivocally with the soldiers’ actions and the falsity of the allegations. I quote:
“this Inquiry has established beyond doubt that all the most serious allegations, made against the British soldiers involved in the Battle of Danny Boy and its aftermath and which have been hanging over those soldiers for the last 10 years, have been found to be wholly without foundation and entirely the product of deliberate lies, reckless speculation and ingrained hostility.”
He indeed contrasts the falsity of the Iraqi accounts with the truthfulness of the military witnesses:
“the vast majority of the allegations made against the British military, which this Inquiry was required to investigate (including, without exception, all the most serious allegations), were wholly and entirely without merit or justification. Very many of those baseless allegations were the product of deliberate and calculated lies on the part of those who made them and who then gave evidence to this Inquiry in order to support and perpetuate them.”
The counsel for the nine former detainees and the relatives of the deceased conceded only as late as March this year that the evidence pointed overwhelmingly to the fact that, as the Government maintained throughout the inquiry and preceding judicial review, all those whose bodies were handed over to the Iraqi authorities for burial on 15 May died on the battlefield. The delay in making this concession is both inexplicable and shameful. By 4 July last year, expert witnesses had already demonstrated unequivocally that the Iraqis had died as a result of wounds sustained in the fighting. Had the concession been made then, it would not have been necessary for so many soldiers to give evidence, Sir Thayne could have concluded his hearings more quickly, and there would have been a significantly smaller bill to the taxpayer.
I turn now to the issue of detention. Following the battle, the nine detainees were taken to Camp Abu Naji. Sir Thayne has rejected most of the allegations made in connection with their treatment at the camp, including a lack of adequate medical care, assaults, the withholding of drinking water in contravention of the Geneva conventions and the use of white noise. However, I accept Sir Thayne’s conclusion that some instances of ill treatment did occur: the detainees were not provided with adequate food, and such food as was given was not provided until they had been tactically questioned; they were prevented from sleeping until three to four hours after they arrived at the camp; their sight was restricted almost continuously; and the use of “harsh” tactical questioning techniques—since withdrawn—amounted to ill treatment. Importantly, Sir Thayne observes that as a result of changes made by the MOD over the past several years, such ill treatment should not occur in future.
Sir Thayne also concluded that the requirement for detainees to undress fully as part of their medical examination and concurrent search for prohibited items amounted to ill treatment, and he did criticise the attitude of the regimental medical officer towards the medical examination of the detainees on their arrival at Shaibah, but he also concluded that only one of the detainees, who suffered discomfort for longer than he might otherwise have done, suffered any adverse consequences as a result of deficiencies in the medical examination. I wish to express my regret to the House that these instances of ill treatment should have occurred.
Sir Thayne Forbes has made just nine recommendations, and he acknowledges the progress that the Ministry has made since 2004 to improve all aspects of the prisoner-handling system—from policy and doctrine to unit-level instructions and procedures as well as training and oversight—and to ensure it complies with domestic and international law. I accept all nine recommendations in principle. I have commissioned urgent work on their practical implications—in particular, we will need to ensure that they will not prevent the armed forces from carrying out vital tasks—and I will announce to the House my detailed conclusions as soon as I can.
The Iraqi detainees, their accomplices and their lawyers must bear the brunt of the criticism for the protracted nature and £31 million cost of this unnecessary public inquiry. The falsity of the overwhelming majority of their allegations, the extraordinarily late disclosure of a document showing the nine detainees to have been insurgents and the delay by their lawyers in withdrawing the allegations of torture and murder have prompted the Solicitors Regulation Authority to investigate possible breaches of professional standards. The authority is expected to complete its investigation into the two firms responsible, Public Interest Lawyers and Leigh Day and Co., early next year.
Had the Legal Services Commission been aware in 2008 of this document it would have refused legal aid for the judicial review that took place then. That would have spared the service personnel a further six years of uncertainty and anxiety. It would have spared the relatives of the deceased a further six years of false hope, and it would have saved the British taxpayer a very high bill.
Although procedural failures by the MOD led to the public inquiry being established, it is those who made these false allegations who bear the responsibility for saddling the taxpayer with what has turned out to be a £31 million bill. Although there is no provision in the Inquiries Act 2005 for recovering the costs of a public inquiry, my Ministry is exploring whether the claimants’ failure to disclose the militia document will allow us to recover some of the costs of the judicial review.
In conclusion, I regret that it was found necessary to hold a public inquiry to disprove these allegations. This is not another Baha Mousa or an Abu Ghraib. No one died in British custody and there was no deliberate ill treatment. The few instances of ill treatment that did occur were rather the result of failings in doctrine and training that have already been or are being corrected. This was a shameful attempt to use our legal system—our legal system—to attack and falsely impugn our armed forces. That it has failed reflects the diligence and skill with which Sir Thayne has uncovered the facts.
I quoted earlier the accusations made by Mr Shiner of Public Interest Lawyers in calling for this inquiry. At that time he said:
“Do not believe for one second that we make these allegations lightly or without the evidence available to substantiate every single word of what we say.”
It is now beyond doubt that those allegations were without foundation. I challenge Mr Shiner and the other lawyers involved, from both firms, to issue an unequivocal apology to the soldiers whose reputations they attempted to traduce and to the taxpayers who have had to pay the costs of exposing these lies.
I add only one final comment. Following the battle of Danny Boy, five soldiers were awarded the military cross and one the conspicuous gallantry cross for their conduct there and in other engagements in early 2004. Other acts of bravery emerge clearly in the accounts of the battle. This is who our servicemen and women are. The reputation of our armed forces has been hard won in the service of our nation. It will survive the baseless slurs of those who seek to undermine those on whom we all depend. I commend this statement to the House.
Vernon Coaker (Gedling) (Lab)
I thank the Secretary of State for advance sight of his statement and for providing a copy of the inquiry report this morning. I also join him in thanking Sir Thayne Forbes and his team for their diligent work and comprehensive and conclusive report.
As the Defence Secretary said, our armed forces are the best in the world. British servicemen and women carry out their duties with bravery and distinction, and we owe them all a debt of gratitude for their service to our country. They often face the most difficult and challenging conditions. The battle of Danny Boy in southern Iraq in 2004 was one such occasion when the battle was ferocious and our troops were in great danger.
As the Defence Secretary rightly pointed out, five soldiers were awarded the military cross and one the conspicuous gallantry cross. As well as their courage, British soldiers pride themselves on their conduct in battle and the high standards to which they are held and indeed hold themselves. Does he agree that they are and will remain accountable both to international law and to the Geneva convention?
Does the Defence Secretary also agree that this House and any UK Government are not afraid to be open and frank when those high standards are not met and our armed forces do not adhere to the conduct expected of the British military? There are many examples of that—most strikingly, the statement of the Prime Minister and the Leader of the Opposition in 2010 after the publication of the report of the Saville inquiry into the events known as Bloody Sunday, and the response to the Baha Mousa inquiry. It should be a source of pride that we are a country where that can happen.
Does the Defence Secretary agree that, likewise, we will not tolerate calculated, malicious and baseless untruths against our servicemen and women? This report states in those very terms that the serious allegations that precipitated the inquiry were just that. There were no unlawful killings on the battlefield, no mutilation of bodies and no executions in custody. I want to establish that very clearly before I ask him some questions about the report’s findings.
In dismissing the serious allegations made against British troops, the report nevertheless draws attention to some areas where we should learn lessons. Opposition Members support the conclusions and recommendations of the report. Does the Defence Secretary agree that the implementation of its nine recommendations can be achieved with speed and efficiency? We will support him in achieving that.
The report says that the conduct of some individual soldiers did amount to actual or possible ill treatment. I of course join the Defence Secretary in expressing regret that that occurred. It is not acceptable. Have the soldiers been identified? Are they still in service and, if so, what steps are being taken to address those concerns? The report states that Ministry of Defence procedures in place at the time might have contributed to what happened. Can the Defence Secretary confirm that, if those procedures have not been updated already, they will be reviewed now?
The report identifies ways in which we might be able to avoid the need for such costly inquiries in future. I share with the Defence Secretary the concerns about the legal representatives and the legal process in this instance. In that sense, the recommendations in the report will ensure a better way of examining allegations against the armed forces, avoiding unnecessarily cumbersome processes and, as he pointed out, significant financial costs.
What progress has been made on the collection and storage of and ability to search documents and other records? Has the shooting incident policy been reviewed and updated? Are there plans to do so? What changes have been made to the recording of the circumstances of a prisoner’s detention? More generally, how does the Defence Secretary plan to review any shortcomings in existing practices and procedures, and ensure that they are updated and amended?
In its conclusion, the report compared, as did the Defence Secretary, the testimony of those alleging and those being accused. The report said that the Iraqi witnesses were
“unprincipled in the extreme and wholly without regard for the truth”
while the British military witnesses were, by contrast, “truthful and reliable”, despite the difficulty and distress caused by recalling traumatic events of battle. I think the House will join me in saying that that speaks for itself—and it speaks volumes.
Michael Fallon
I am grateful to the shadow Defence Secretary for what he has said and for the tone in which he said it. I agree with his comment about the baseless untruths. He started by saying that our armed forces must be accountable to the law, and it is important to emphasise that—that they are accountable under both domestic law and the law of armed conflict, and that where there are allegations they will always be investigated. We should be open and frank about that. Where instances of some ill treatment or harsh treatment occur, they should be fully and honestly investigated. I do think that there are very few countries and judicial systems that would put themselves through this kind of inquiry to get to the truth.
The hon. Gentleman asked me some specific questions. On the recommendations, I am studying the report in detail and I will respond, as is customary, within the next few weeks on the detail of the recommendations. I hope it is clear that I accept the spirit of them all and the principle behind them all. I just have to look at some of the practicalities of implementing at least one or two of them.
I do not have any up-to-date information about where the personnel are currently serving. Perhaps the hon. Gentleman would allow me to write to him on that specific point.
On the procedural changes, these were the procedures that applied 10 years ago, in 2004. Sir Thayne himself acknowledges that many of the procedural changes have already been introduced. On the public inquiry, it might have been easy for the incoming Government—the inquiry was set up under the previous Government—simply to halt the public inquiry, but I believe that it was the right decision to allow it to run its course. However, we now have the Iraq historic allegations team, which will be able to get at the truth of these allegations probably in a different format and a little more quickly than a public inquiry, inevitably. That is not a criticism of Sir Thayne—far from it.
Rory Stewart (Penrith and The Border) (Con)
I join the Secretary of State in absolutely commending the report for reinforcing the honour and respect of the British soldiers. Having been based in Abu Naji and Maysan at the time, I encourage the Secretary of State to focus on the broader political context. It was completely tragic that not just a few Iraqis, but most of the Iraqi leadership in the province were convinced of these unimaginable atrocities. I encourage the Secretary of State to ensure that in future we have the right role for political officers on the ground to ensure that bodies are treated in the correct fashion, that the survivors’ families are reached out to in the correct fashion and that trust is built between the British military and the local political leaders to ensure that our soldiers are protected from these baseless allegations.
Michael Fallon
My hon. Friend makes the very important point that we need to reflect on the extent to which these lies and untruths were believed by the local community in the area. He makes the point all the more powerfully because of his personal experience and knowledge—not simply of Iraq, but of that particular province of Iraq. I will certainly reflect further on the point he makes about the role of political officers.
Mr Bob Ainsworth (Coventry North East) (Lab)
I commissioned this report only after the Department was very heavily criticised in the courts for having failed properly to investigate the allegations that were being made. I believed then, as I believe now, that the main reason for that failure was not a lack of will on our part, but a refusal to co-operate with an inquiry by the representatives of the Iraqis, public interest lawyers and Mr Phil Shiner. I have no way of knowing or proving what the motives were for that lack of co-operation, but I do know that public interest lawyers have a very lucrative business model.
We have to ensure that when serious allegations are made, they are properly investigated. That is the kind of nation we are and it is the way in which we manage to ensure that our armed forces maintain the very highest levels attainable. Equally, however, we have to protect the public purse from misuse. I urge the Secretary of State, his Government colleagues and the other parties in the House to think about how we can ensure that both those things happen. We need to continue to impose the rule of law in very difficult circumstances, but also to ensure that our systems are not being systematically abused.
Michael Fallon
I am grateful to the right hon. Gentleman for explaining the circumstances in which the public inquiry came into being. He has much closer knowledge of it than others, because he was responsible for setting it up. He is right: the price that we pay for the reputation of our armed forces is that when such allegations are made—wherever they come from—they must be investigated, and they are investigated immediately in the field by the Royal Military Police and their special investigators. It is right that that happens.
The right hon. Gentleman made an important point about costs, and the fact that certain unscrupulous lawyers appear to be benefiting directly, at public expense, from their ability to trigger inquiries such as this. We need to look into how that might be curtailed, and I welcome his suggestion that the matter might be pursued on a genuinely bipartisan basis.
Mr Kenneth Clarke (Rushcliffe) (Con)
Does my right hon. Friend agree—he appears to—that, while it is essential for a country with values such as ours to hold inquiries into the serious allegations against our armed forces or our intelligence services that are made from time to time, there is always the danger that a tiny minority of the legal profession will create something of an industry in pursuing them to the point of a long and difficult inquiry such as this? Will he ask our right hon. Friend the Secretary of State for Justice to take the matter up with the leaders of the judiciary and the leaders of the profession, who I am sure will agree with him that there is a danger that needs to be tackled?
Michael Fallon
As I have already emphasised, when there are allegations they need to be investigated and when there are failings they need to be put right, but what has emerged very clearly from the report is that all those serious allegations had no foundation whatever. My right hon. and learned Friend has made the constructive suggestion that we should discuss not just with my right hon. Friend the Justice Secretary but with the leaders of the profession how we can curtail some of the abuse and cost involved. His point is all the more powerful given that he is a member of that profession; it is good to hear such a suggestion from the profession itself.
Mr Elfyn Llwyd (Dwyfor Meirionnydd) (PC)
I fully accept the report’s conclusions, and I am delighted on behalf of the individual members of the armed forces who were accused of these vile atrocities. They have been completely exonerated, which is good for them and good for the armed forces generally. However—this point was raised by the hon. Member for Gedling (Vernon Coaker)—while I recognise that instances of ill treatment are few and far between and are relatively minor in comparison with the awful accusations that were levelled at the troops, I trust that they will be addressed by the Secretary of State.
Michael Fallon
Yes. As I said earlier, we have already made a series of changes in our procedures, and we will continue to do so. The report makes some important points about retrieval of information from the battlefield, archiving and the use of information systems to make it easier to get more quickly to the truth of what actually happened. Let me emphasise again, however, that when there are allegations they will be properly and fully investigated, and when there are failings we should own up to them and put the procedures right.
Mr James Gray (North Wiltshire) (Con)
It is of course an absolute outrage that it has taken 10 stress-filled years to clear these young soldiers of the baseless slurs against them, but is there not a wider point to be made? Does the Secretary of State agree that allowing further claims and allegations of this kind—the baseless ones and even, perhaps, the slightly less baseless ones—to be pursued in the same way might interfere with the perfectly legitimate conduct of warfare, and that there is a real risk that legitimate warfare will be replaced with “lawfare”?
Michael Fallon
I am, of course, concerned that the operational efficiency of commanders in the field should not be inhibited by additional legal complications, such as fresh rulings by the European Court of Human Rights or attempts to extend a health and safety regime that would apply in civilian life to the battlefield. We must think carefully about the weight of law imposed on those whom we ask to do very dangerous things in our name and to react very quickly. This was a battlefield, and I think it important for the House to bear that in mind.
Derek Twigg (Halton) (Lab)
Obviously we should all support our armed forces, and I welcome what the Secretary of State said in his statement. We have very courageous, professional and decent armed forces who have to perform in some terrible and traumatic circumstances, and we have seen yet again that they are forces of whom we should all be proud. May I ask, however, whether the Secretary of State feels that improvements could be made in the chain of command to enable situations such as this to be dealt with properly in the first place, rather than developing to such an extent that an inquiry is necessary?
Michael Fallon
I am grateful to the hon. Gentleman for his opening remarks. He speaks with particular authority as a former defence Minister, and I will consider what he has said about the chain of command. As we heard from his right hon. Friend the Member for Coventry North East (Mr Ainsworth), a number of interlocking issues were involved. There was the judicial review and the public inquiry, and so on. However, I think that we would all want to avoid putting members of our armed forces through this process, given the time and cost that were involved in exposing an allegation—the major allegation—that turned out to be completely untrue.
Dr Julian Huppert (Cambridge) (LD)
I welcome the statement, and the very clear outcome of an inquiry that was far more credible because it was judge-led. When he established the Gibson inquiry, the Prime Minister said:
“For public confidence, and for independence from Parliament, party and government, it is right to have a judge-led inquiry.”
Does the Secretary of State agree with that principle, and would he like it to be extended to other inquiries into allegations of British involvement in torture?
Michael Fallon
I think that my hon. Friend is tempting me to stray slightly from the subject of the statement. The inquiry clearly benefited from the professionalism and skill of Sir Thayne Forbes and his team, and I think we should leave it at that.
Sandra Osborne (Ayr, Carrick and Cumnock) (Lab)
In all my time in the House, I have seldom been more shocked than I was by the statement today. I cannot even imagine how those service people have coped for 10 years with such a cloud hanging over them. What support are the Government giving them and their families?
Michael Fallon
The hon. Lady’s question gives me an opportunity to update an earlier answer. One of the soldiers named in the report is still serving, but I understand that the rest have left the armed forces.
The hon. Lady has made a good point about the support available to soldiers who must either serve or, if they have left the forces, bear the brunt of allegations of this kind. If I may, I will look into the matter further and write to her.
Sir Oliver Heald (North East Hertfordshire) (Con)
I, too, welcome the statement. It is important that we should inquire into serious allegations when they are made, and that we should have the sort of judge-led inquiry that we have had in this case.
I agree with what was said by my right hon. and learned Friend the Member for Rushcliffe (Mr Clarke), and I share the sense of shock that I think the whole House feels about the people who made up such shocking lies about our armed forces. It is good that the forces have been cleared, but is there any indication of what the motivation was? Was it hostility to our country? [Hon. Members: “Money!”] Was it money? Does anything in the report explain this outrageous behaviour?
Michael Fallon
I am not sure that I should comment on the motives involved—I think that the report speaks for itself in that regard—but I believe that the House would be with me in questioning the motives of some of the advisers involved. I do not think that they have helped the reputation of the British legal system in any respect.
Jim Shannon (Strangford) (DUP)
I welcome the statement. The untrue and false allegations affected the British Army and directly affected these soldiers and their families; for many, they led to both physical and emotional changes. What can be done even now, 10 years later, to undo the untold harm done to the British Army personnel and their families who have been affected?
Michael Fallon
As I have said, I will certainly look at what support was provided to the soldiers against whom the allegations were made and whether we can improve our procedures in that respect. They do now, as of today, have the knowledge that those allegations turned out to be completely untrue, but I think the House will agree that it should not have taken 10 years and all this money for the truth to emerge.
Bob Stewart (Beckenham) (Con)
May I remind the House of just how difficult it is for a soldier in combat to change within milliseconds from a duty to kill the enemy to a duty to protect the enemy under the Geneva conventions? I am extremely proud that our soldiers from both the two infantry battalions concerned have acted so professionally on this occasion and I am very pleased by the outcome of this report. I thank the judge and I am very happy for the British Army.
Michael Fallon
I am grateful to my hon. Friend, who, of course, brings to this House very direct experience of the battlefield and the instant decisions that have to be taken on it. He has particular knowledge of the obligation on our soldiers—which they accept gladly—to do their very best, when the battle is over, for the wounded and for those detained.
Mr Speaker
I think the hon. Member for Beckenham (Bob Stewart) was asking the Secretary of State to agree with him, and the Secretary of State did agree with him. The hon. Gentleman is therefore now, I am sure, doubly happy.
Dan Jarvis (Barnsley Central) (Lab)
I speak as someone who served in Iraq in both 2003 and 2004. While any mistreatment of detainees is completely unacceptable —the Secretary of State has referred to procedural changes that have been made—is it not the case that the overwhelming majority of our servicemen and women have served with distinction and honour, and that, regardless of people’s different views on the conflict, as a country we owe them a debt of gratitude? I ask the Secretary of State to give an assurance that any British soldier who has been materially affected by their service in Iraq will, whatever the point in their life when they have been affected, be properly looked after by our country.
Michael Fallon
On the hon. Gentleman’s first point, he is right to draw the House’s attention to the fact that thousands of British troops served in Iraq. They did so with distinction and they did us proud, and only a very small handful had these allegations made against them. We should remember that.
On supporting our servicemen and ex-servicemen, I am delighted that the armed forces covenant is now enshrined in law; we must now make a reality of that covenant. The Minister of State, Ministry of Defence, my hon. Friend the Member for Broxtowe (Anna Soubry), has written to all colleagues in the House drawing attention to the role we can play in making sure that the covenant is properly implemented by our local authorities, GPs, jobcentres and the others involved in looking after our armed forces. Just yesterday, I think, we published the annual report on the covenant and its operation.
Crispin Blunt (Reigate) (Con)
My right hon. Friend is, of course, right that we must hold our servicemen to the highest possible standards. He will remember that by April 2004 the detention of people in that region was already a point of controversy, but by then—when the Defence Committee visited Shaibah in April 2004—it was clear that any deficiencies had been seriously gripped by the chain of command. When we hold ourselves to such high standards, it is particularly outrageous that the consequences of what perhaps happened to Baha Mousa and the trials that then followed have been thoroughly and unscrupulously abused by extension by the representatives of these people. My right hon. Friend has made absolutely clear what actions he expects the Solicitors Regulation Authority to take, and may I tell him that I absolutely agree with that?
Michael Fallon
I am grateful to my hon. Friend. The events investigated by Sir Thayne were from 10 years ago, just at the beginning of some of the hardest fighting in Helmand, and it is noteworthy that right from the beginning the procedures were being examined and were improved. They have certainly improved significantly over the 10 years.
On the solicitors involved, as I have told the House, there is now an investigation into both firms by the SRA, but I think that before we see the result of that investigation the very least the lawyers involved in this case can do is apologise to the soldiers—and, indeed, to the taxpayer.
Mr Speaker
Order. May I just point out to the House that questions thus far have been on the full side, very understandably as colleagues have wished to express their indignation about the matters concerned? I am keen to accommodate all remaining questioners, but I simply advise the House that there are two very heavily subscribed Opposition day debates to follow, before which, of course, there is a ten-minute rule motion, and I should be grateful if colleagues would tailor their contributions accordingly.
Ms Margaret Ritchie (South Down) (SDLP)
I thank the Secretary of State for his statement. He will be aware of allegations of wrongdoing in relation to Northern Ireland back in the 1970s, where men were tortured and detained without charge. What actions will the UK Government now take to redress the imbalance in relation to that, which has been identified as involving hooded men being subjected to the five techniques of torture?
Michael Fallon
I understand the significance of this issue in Northern Ireland. It is not, of course, the subject of this report, but I know it is part of the discussions into the past that are now being conducted. I hope that will soon be resolved, but the hon. Lady is, quite reasonably, tempting me into areas outside my particular field.
Sir Tony Baldry (Banbury) (Con)
Will my right hon. Friend suggest to the Lord Chancellor that, when the SRA concludes its investigation, the Lord Chancellor comes to the House to make a statement, so that the SRA knows that the eyes of Parliament are going to be on its conduct of this investigation, and not least the question of how the firms of solicitors got their clients? There are suggestions that they were paying agents to go around Iraq to drum up business, often not knowing who their clients were. This seems to me to be yet another issue that needs to be properly investigated by the SRA.
Michael Fallon
I am grateful to my right hon. Friend raising that, and I hope it will be.
Ann Clwyd (Cynon Valley) (Lab)
As a former special envoy on human rights to Iraq, I am particularly pleased that we put ourselves in the dock, we answered the allegations, and we were not guilty of most of them. The reputation of the British Government and British forces is very high indeed in Iraq, and this incident has not detracted in any way from the strong feelings and admiration people in Iraq have for Britain and its forces. The MOD has made changes because there were some instances of ill-treatment. What precisely are these changes and how can the Secretary of State assure us that they will result in such ill-treatment not happening again?
Michael Fallon
I agree with the right hon. Lady about the reputation of our troops; I heard that for myself on my visits to Baghdad and Irbil. They did an impressively good job in Iraq.
I hope, Mr Speaker, you will also allow me to make a correction. I think I misspoke a moment ago: I referred to Helmand. I am afraid that was the pressure of making this statement. I of course meant to refer to the early years of fighting in Iraq.
Improvements have been made to the procedures, and there are important recommendations, particularly about the retrieval and archiving of information to make it easier to find out exactly what happened and for that information to be brought back to the United Kingdom, so that when these allegations are made, they can be quickly and properly investigated.
Mr Stephen O'Brien (Eddisbury) (Con)
On behalf of all Members, I thank the Secretary of State for the outstanding tone and substance of the statement. I hope the Solicitors Regulation Authority will restore some standing to the profession of which I am a member, as we are all ashamed of the actions of certain members of it in the background. Will he discuss with the Foreign Secretary and the Home Secretary whether there has been an examination of those organisations, including some charities, to which the Government continue to give funds, and which use that money to instruct solicitors or to front actions against the Government or our armed forces?
Michael Fallon
I am grateful to my right hon. Friend for his earlier comment, and I will certainly take forward his suggestion that that aspect should be investigated too.
John Woodcock (Barrow and Furness) (Lab/Co-op)
Will the Secretary of State expand on the answer that he just gave to my hon. Friend the Member for Barnsley Central (Dan Jarvis)? What assurances can he give to the public that not only will the recommendations result in the protection and humane treatment of detainees, but that our armed forces will get protection when they need to be able to operate effectively in very difficult circumstances where lives are at risk?
Michael Fallon
On the first point, Sir Thayne Forbes himself has accepted that some of the procedures involved have already been improved. Corrections have been made and the procedures are now operating far better than in the very early years 10 years ago, but the hon. Gentleman makes an important point. There is a balance to be struck between the obligations that we ask our soldiers to accept when they are involved in very dangerous tasks, particularly on the battlefield. That is why I am concerned about the encroachment of other kinds of law on what is already a satisfactory basis of law—the law of armed conflict and our own domestic law.
Mr Henry Bellingham (North West Norfolk) (Con)
Further to the excellent question from my right hon. and learned Friend the Member for Rushcliffe (Mr Clarke), a truly dreadful abuse of the legal system has caused untold stress to our loyal troops. Is there an argument for a civil claim against the two lawyers? Does my right hon. Friend agree that the two law firms in question and the lawyers involved should have their practice certificates suspended, pending the SRA inquiry?
Michael Fallon
On the first question, I lack the legal expertise to comment on whether a civil claim would have a chance of success. On the practice certificates of the two firms, that is a matter for the Solicitors Regulation Authority.
Mrs Sharon Hodgson (Washington and Sunderland West) (Lab)
I was interested to hear Sir Thayne Forbes say that the reason for gathering the bodies of the combatants was
“to see if there was amongst them an individual, known by the codename Bravo 1, who was suspected of having been involved in the murder of the six Royal Military Policemen in Majar Al Kabir in June 2003.”
The Defence Secretary will know that my constituent, Corporal Simon Miller, was among the Red Caps murdered in that massacre. Does he therefore agree with me that the attempt to identify Bravo 1 was justified? Can he tell us whether the suspect in question was indeed identified that day?
Michael Fallon
As I understand it—I am open to correction—all the detainees were revealed to have been insurgents. One of the things that the inquiry has thrown up is the distinction between general interrogation and what is called tactical questioning, where people need very quickly to get as much information as they can in order to save lives or to prevent further bloodshed on the battlefield. It is that distinction that Sir Thayne discusses when he comes to the various procedures. As I understand it, in terms of the very specific identification on that day, it did not take place.
David Mowat (Warrington South) (Con)
We are the only country in the world that pays legal aid to sue our own Army. We then pay millions to defend our Army in those cases. Public Interest Lawyers has made over £1 million a year from such cases in each of the past four years. Is there a realistic opportunity for us to get some of that money back? Will my right hon. Friend assure the House that if there is, he will go after it as best he can?
Michael Fallon
We all regret the amount of time and the cost of this inquiry, but I am still proud to live in a country where these things can be fully investigated. It has taken far too long and cost far too much money, but I would rather the truth came out, however painful it has been. On the recovery of costs, as I said, we are looking at whether some of the costs involved in the earlier judicial review claim can now be recouped.
Hugh Bayley (York Central) (Lab)
One question that has not yet been raised relates to the asymmetric nature of so much modern warfare. When our troops go into battle, more often than not it is not against another nation state that observes international law and the Geneva convention, but against irregulars who do not observe the rule of law. This must put our soldiers in the heat of battle under immense psychological pressure. Will the Secretary of State reassure me that the lessons from this report will be fed into the way our soldiers are trained, which has enabled them to maintain very high standards when fighting against people who do not maintain the same standards against them?
Michael Fallon
That is already part of the training that our servicemen and women now undergo, but the hon. Gentleman makes an important point. The House should wonder whether the Taliban or ISIL would rush to provide bottled water before they were asked to do so if they had British detainees in their custody, or indeed if those detainees had survived to be in their custody.
Mike Gapes (Ilford South) (Lab/Co-op)
The Secretary of State said that the cost of the public inquiry was £31 million, but that of course is not the total cost. Can he give us a figure for the total cost, including the costs before the public inquiry? Does this come out of the MOD’s budget or the Ministry of Justice’s budget? How many ships, planes and service personnel have we lost as a result of those firms taking this money?
Michael Fallon
I cannot give the hon. Gentleman the figures for the earlier costs. The figure of £31 million is specifically for the public inquiry. As he said, that is a huge and unacceptable amount. It comes directly from the defence budget and he is right—it could otherwise have been spent on providing more equipment for our troops and on many other things that people might have regarded as having a higher priority.
Thomas Docherty (Dunfermline and West Fife) (Lab)
The Secretary of State may recall that in 2004 a number of nationalist MPs gave £14,000 of taxpayers’ money to that law firm for an earlier case. Does he think there is merit in the MOD raising this with the Independent Parliamentary Standards Authority to ensure that nationalist MPs never again squander taxpayers’ money on those ambulance-chasers?
Michael Fallon
I do not recall that, but perhaps I could look into it and get back to the hon. Gentleman on that specific point.
Huw Irranca-Davies (Ogmore) (Lab)
I welcome the clarity and the robustness of the statement. On dealing with the aftermath of a battlefield situation and the handling of prisoners, the Secretary of State has mentioned on a couple of occasions that one of the lessons learned relates to data and intelligence gathering from the battlefield. Are there further lessons to be put in place in training or procedures?
Michael Fallon
There are a number of recommendations which we want to study in detail. I have made it clear to the House that I accept the principle and the intent that lie behind them. We have to work through some of the practicalities—for example, video recording and how that would work in a situation very close to the battlefield. I will, of course, come back to the House with my detailed conclusions within a few weeks, I hope.
Gavin Shuker (Luton South) (Lab/Co-op)
I commend the Secretary of State on an extremely well-judged statement, in which I believe he spoke not just on behalf of his Department, but on behalf of the whole House. What more can be done to get the clear message out—particularly to communities and individuals, among whom I would count myself, who vehemently opposed the Iraq war in 2003—that British troops in Iraq did not torture or murder,?
Michael Fallon
That is indeed an important point. I will consider not only how we might disseminate the findings of this report across the United Kingdom but, as the Chairman of the Select Committee said, what more we can do to reassure the Iraqi communities that British troops do not behave in the way that was alleged.
Points of Order
Michael Connarty (Linlithgow and East Falkirk) (Lab)
On a point of order, Mr Speaker. You will have noticed that I was somewhat disgruntled at being cut off and told that my question was too long at Prime Minister’s questions. I take everyone who visits me at the House of Commons to see the picture of Speaker Lenthall. I know that it is difficult to apply a principle to all cases proportionately, but will you find the time to meet me to discuss the fact that I do not believe that the principle of defending the ability of Back Benchers to ask questions of the Executive was upheld proportionately in all cases today?
Mr Speaker
I am extremely grateful to the hon. Gentleman for his point of order. I say in response that the Speaker does not refuse to see hon. or right hon. Members. If a Member wishes to see the Speaker, the Speaker will be happy to see that Member at a mutually convenient time. I say in the very gentlest way to the hon. Gentleman, first, that the Chair has to be the judge of whether a question is too long. With the greatest of respect, no Member can be judge in his own cause. Secondly, I intend no discourtesy to him, but he was in my view—and I have to make the judgment, not he—taking too long to get to the gravamen of his question. I say very kindly to him that he ought not immediately to think, “Where did the Chair go wrong?” but perhaps to think, “Where did I go wrong and how might I do better?” But of course I will happily see him—[Interruption.] I am not debating the matter with him now. I am telling him, in a very gentle and understated way, what the position is. With that statement, the hon. Gentleman will have to rest content. We will leave it there.
Maria Miller (Basingstoke) (Con)
On a point of order, Mr Speaker. This morning it has been announced that Rev. Libby Lane is to become the Bishop of Stockport, and therefore the first woman bishop of the Church of England. At a time when there are more women in work than ever before and more women taking leadership positions, I am sure that the whole House will want to take a moment to welcome such an important first step towards ensuring that the extraordinary talents of the 1,700 women clergy in the Church of England are recognised and used to the full.
Mr Graham Brady (Altrincham and Sale West) (Con)
Further to that point of order, Mr Speaker. I warmly endorse my right hon. Friend’s point of order. Rev. Libby Lane is currently the vicar of St Peter’s in Hale in my constituency, an office that she has conducted with outstanding ability. She has made a great contribution to the community, and I am sure that she will continue to do so in her new role as Bishop of Stockport.
Mr Speaker
I thank the right hon. Lady for her point of order, and the hon. Gentleman for his follow-up point of order. I think that they speak for Members on both sides of the House and throughout it in offering the warmest congratulations to Rev. Libby Lane on her appointment. It is a wonderful and joyous occasion of celebration for her and also, I hope, a sign of great and progressive change within the Church.
Paul Flynn (Newport West) (Lab)
On a point of order, Mr Speaker. A distinguished former British ambassador to Afghanistan said yesterday of our conduct of that war that it was
“a massive act of collective self-deception”
by politicians and generals. We must recall that 453 brave British soldiers lost their lives in that war. A major inquiry was promised by the Leader of the House into the war and into why we went into Helmand in the belief that not a shot would be fired. Is it not essential that we should hold that inquiry before we contemplate sending more British soldiers to risk their lives in foreign lands?
Mr Speaker
The hon. Gentleman is a wily operator if ever there was one. I think he knows that his question was directed not at me but at the Secretary of State for Defence and at tomorrow’s Official Report. In that respect, he has achieved his objective. He has made his point and it will be recorded; it has also been heard by those on the Treasury Bench.
John Hemming (Birmingham, Yardley) (LD)
On a point of order, Mr Speaker. Eugene Lukjanenko-Soifertis is a concert pianist. I have here a copy of the draft agenda of the European Parliament committee on petitions, dated 11 November. At item 15, Mr Lukjanenko-Soifertis petitioned the committee. I have attempted to table an early-day motion referring to what happened at that petitions committee—
Mr Speaker
Order. The hon. Gentleman will be aware that I cannot know what he is about to say, but I should like to establish this point. I hope that he is not seeking to use the device of a point of order to say what he would have said if he had gone ahead in the way that I was advised he should not do—[Interruption.] He has a smile on his face, and this is occasioning gentle and wry amusement in the House. I understand that, but it would be quite disorderly and improper if he were to use a point of order in that way. I am sure that he is not going to try to do that—is he?
John Hemming
No. I do not think that I have been told not to refer to the fact that Mr Lukjanenko-Soifertis is a concert pianist or to the agenda. I have, however, been told not to refer to what happened at the European Parliament’s petitions committee, despite the fact that it is available on the internet and can be looked at very easily. I am not allowed to refer to what happened in a motion. I would therefore like to ask my first question of the Speaker. If I were to come here with a copy of the minutes of that petitions committee meeting, would it be in order for me to refer to their contents? Secondly, given that when I tried to table a petition referring to the same issue, I was told that it could not be tabled for the same reason of sub judice, will the Speaker please explain why we, uniquely as a jurisdiction, have a rule of sub judice in respect of petitions and tell me what is happening about that?
Mr Speaker
I am grateful to the hon. Gentleman for his point of order. I say in the most positive of spirits that his words are his choice and my words, by way of response, must be mine. He sought a waiver of the sub judice resolution from me in connection with a proposed early-day motion about a matter before the petitions committee of the European Parliament. Of course I took advice, as colleagues will appreciate, but I was not persuaded of the case for such a waiver. Subsequently, it was brought to my attention that another Member, the hon. Member for Burnley (Gordon Birtwistle), had sought to present a public petition on behalf of the hon. Member for Birmingham, Yardley (John Hemming) that essentially repeated the terms of his proposed early-day motion. I concluded that the presentation of a petition was not an appropriate way to circumvent the sub judice rule, and was not what the House intended to happen when it made its resolution concerning sub judice.
The right to petition this House is an ancient one. It can be an important last resort after all other efforts to address a grievance have been exhausted, but if a case to which a petition relates is active in the courts, all other avenues have not been exhausted. A petition must seek a remedy that it is within the power of the House to grant, and it is hard to see how that requirement could be satisfied when the matter in question is actively before the courts. In these circumstances, I have taken the view that a petition should not be received. The hon. Member for Birmingham, Yardley might wish to take this matter up with the Procedure Committee, of which he is a distinguished ornament—[Laughter.] That is a compliment to the hon. Gentleman. The application of the sub judice rule to public petitions seems to me to be an appropriate matter for that Committee to consider. When people raise points of order, they want a reply and, preferably, some advice from the Chair. In the best possible spirit, I am advising the hon. Gentleman on a constructive way forward under the auspices of that Committee, which is chaired with distinction by the hon. Member for Broxbourne (Mr Walker). I hope that if the hon. Member for Birmingham, Yardley wants a resolution to the matter, he will follow that course.
John Hemming
I thank the Speaker for his advice. In fact, the matter is to be discussed in the Procedure Committee later today, which is why I wished to raise this point of order to clarify the issue specifically in respect of petitions before that meeting took place.
Mr Speaker
The hon. Gentleman will have his own rationale for wanting to advertise the matter here first, and I make no complaint about that, but I hope he will accept that we have to leave it there for today.
Royal Assent
Mr Speaker
I have to notify the House, in accordance with the Royal Assent Act 1967, that Her Majesty has signified her Royal Assent to the following Acts:
Childcare Payments Act 2014
Wales Act 2014
Taxation of Pensions Act 2014
Buckinghamshire County Council (Filming on Highways) Act 2014.
Women’s Refuges (Provision and Eligibility)
Norman Baker (Lewes) (LD)
I beg to move,
That leave be given to bring in a Bill to require provision of women’s refuges in certain areas; to set out requirements of local councils relating to women’s refuges; and for connected purposes.
It is a sad fact of our society that violence against women is all too common—far too common. Women’s Aid estimates that one in four women experiences domestic violence at some point in their lives. I believe that the coalition Government has a good record on this matter, and I am pleased to have played a part in delivering some action, including the creation of domestic violence protection orders, the domestic violence disclosure scheme and the actions taken to get the police and the Crown Prosecution Service to take matters of domestic violence far more seriously. I have to say, however, that there is a crucial gap in delivery of these services: the provision of refuges in our society. The gap has emerged because of local authority budgets, which of course are very challenging, and because some local authorities have decided that it is appropriate—I do not believe it is—to make cuts in refuge provision. In addition, because domestic violence has rightly gone up the agenda, we are now seeing more women having the confidence to come forward to access the services, as is their right, and that is putting further pressure on the services themselves.
Women’s refuges are crucial. They are not just a bed for the night; specialist refuges provide secure accommodation, usually at a secret address, and a range of specialist and holistic support services. Uprooting lives, often including those of children, is a last resort for women when they feel that nothing else will keep them safe—when there is nowhere else for them to go.
Unfortunately, we are seeing challenges to the provision of refuges across our country. Since 2010, we have seen a 17% reduction, from 187 to 155, in the number of specialist domestic violence refuges. Nearly a third of referrals to refuges across the country were turned down last year because of a lack of space, and on one day in 2013, 155 women and 103 children were turned away from the first refuge they called because there was no space for them. That is quite unacceptable and nobody in this House can be satisfied with that situation.
This is not simply about the number of refuges; it is also about the way in which local authorities are commissioning services for the refuges. According to the Women’s Aid “Gold Book” of domestic violence services, since 2011 there has been a 30% reduction in the number of refuge services listed saying that they can accept emergency overnight referrals and a 28% reduction in the number of domestic violence services that have 24-hour staffing. So the commissioning practices of local authorities are also severely affecting those who need to access the services.
One particularly pernicious and unhelpful development is that some local authorities have decided, for reasons best known to themselves, no doubt, that they should impose conditions on which women can access the services. Some authorities are imposing “local connection” requirements, but the last place that someone who has been subject to domestic violence wants to be is very local. They need to be somewhere safe, which is not next to where the perpetrator of violence may be. Local connections are absolutely not what we need to see in refuge provision.
Between April and October 2014, four local authorities issued tenders that included local connection rules saying that 70% to 80% of the refuge spaces in the service have to be reserved for women and children who live in the local area. Four local authority tenders for domestic violence services run by a non-specialist organisation did not include refuge provision, which is the second problem we face in commissioning. Commissioning practices tend to exclude specialist provision and appeal to much larger companies, of a more generalist nature, which sometimes do not understand what they are providing and for whom. So the specialist nature of provision, which is key to delivery, is also being eroded in an unhelpful way.
One local authority awarded a tender for refuge accommodation to a non-specialist service outside the local area, even though the submission from its specialist domestic violence service locally was less expensive. Local authorities are not only failing to provide sufficiently for women who need to access the services, but losing money unnecessarily for the council tax payer in some cases. In the worst cases, women are being refused access to refuges because they do not have a local connection and they are then given emergency accommodation at council expense while beds sometimes lie empty in those refuges—that cannot make sense.
My Bill would require the Government to set a minimum network standard across the country on the number of refuges and by local authority area, and it would end, with immediate effect, any further closures of refuges by a local authority. A woman who needs to access a refuge must be able to do so; we cannot have women turned away in the way that has been happening recently.
Secondly, my Bill would make it a statutory duty on local authorities to provide such services. We are seeing cuts and we will in the future, as cuts are coming down the track whoever is in government after the next election, and local authorities are bound to be looking at refuge provision as part of their savings. I know that in my East Sussex county council area there were plans to cut refuge provision. Thankfully, they have been headed off for the time being, but I imagine such plans will come back, both there and elsewhere, unless there is a statutory duty to make such provision.
Thirdly, I want the Government to issue statutory guidance, which would, for example, ban the local connection criterion and do other more sensible work on how local authorities are commissioning services.
I welcome the £10 million lifeline the Government has provided to help refuge provision in the short term, which was announced in late November. I had pressed for it inside government when I was in the Home Office, but I am sure Ministers recognise that it is only a stop gap and that a more permanent solution is required. I am concerned that the bidding arrangements that have been put in place require us to go through housing authorities, and that in a two-tier local authority area, such as mine, Lewes district council or Wealden district council would have to handle the bid, although the refuge provision is handled by East Sussex county council. That seems to make no sense and creates an unnecessary bureaucratic hurdle. I welcome the fact that the temporary stop-gap Government money prevents the geographical restrictions I have referred to as being very unhelpful, and I note that the commissioning help which I helped to initiate when I was a Home Office Minister is already being given to local authorities.
The Government has done a lot to help women who are subject to domestic violence in our society—as the Home Secretary knows, they get a very clear steer that it is not acceptable. It is a great pity that, having done such a great deal of work, there is one gap in provision, which is so crucial: the fact that local authority cuts are leading to a reduction in refuge provision or to bad commissioning. There is a gaping hole that needs to be filled. My Bill closes that gap.
Question put and agreed to.
Ordered,
That Norman Baker, Jenny Willott, Caroline Lucas, Dr Julian Huppert, Sarah Champion, Dr Sarah Wollaston, Annette Brooke and Mr Jeremy Browne presented the Bill.
Norman Baker accordingly presented the Bill.
Bill read the First time; to be read a Second time on Friday 23 January 2015, and to be printed (Bill 141).
Opposition Day
Housing Benefit (Abolition of Social Sector Size Criteria)
(10 years ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
16:19 - The House divided: - Ayes: 266 / Noes: 298 - Question accordingly negatived.
16:32 - The House divided: - Ayes: 300 / Noes: 262 - Question accordingly agreed to.
Madam Deputy Speaker (Dame Dawn Primarolo)
Before I call Rachel Reeves to move the motion, I can inform the House that the Speaker has selected the amendment in the name of the Prime Minister.
Rachel Reeves (Leeds West) (Lab)
I beg to move,
That this House believes that the housing benefit social sector size criteria, otherwise known as the bedroom tax, should be abolished with immediate effect.
Today, Members of this House have a chance and a choice: a chance to put right one of the worst injustices we have seen under this unfair, out-of-touch Government; and a choice to make about where they stand on the question of how we treat some of the most vulnerable and disadvantaged members of our society. In just a few hours, we could vote to abolish and repeal the bedroom tax, an extraordinarily cruel and unfair policy that has hit half a million low-income households, two thirds of them including a disabled member and two fifths of them including children, with a charge of more than £14 a week, on average, which most cannot afford to pay, simply because they have been allocated by a council or a housing association a home that the Government now decide has too many rooms.
One week before Christmas we have a chance to bring hope and relief to hundreds of thousands of people who are struggling to stay in their home, pay the bills and put food on the table by scrapping this cruel and punitive tax on bedrooms, which is yet another example of Tory welfare waste.
Sir Tony Baldry (Banbury) (Con)
There is a slight groundhog day quality to this debate. I am sure that we have had an identical debate before. Indeed, I was thinking of making the same speech that I made last time in this debate, and wondering whether anyone would be interested. There is something that I do not understand, and have never understood. The previous Government introduced exactly the same policy for tenants in the private rented sector on housing benefit, so why is it thought appropriate to have that policy for tenants on housing benefit in the private rented sector, but not appropriate for tenants in social housing on housing benefit?
Rachel Reeves
If the right hon. Gentleman participated in previous debates on this matter, he would know that the rule for private housing was not retrospective, so it did not affect people who were already living in their accommodation. In addition, in the private sector there is no security of tenure, which has hitherto existed in the social rented sector.
The numbers affected by this indefensible policy are shocking, but it is individuals and families whom we must keep in mind. I want to tell the House about a young man I visited at his home in west Wales a few weeks ago. Warren Todd is 15 years old. He has a rare chromosomal disorder called Potocki Shaffer syndrome, which affects the development of his bones, brain and other organs, and means that he suffers from epilepsy, autism, skeletal problems and learning disabilities. For most of his life, Warren has been cared for by his grandparents, Sue and Paul Rutherford. They have dedicated their lives to giving him a decent childhood and, by enabling him to live at home instead of residential care, they are saving us, the taxpayer, thousands of pounds every week.
We should celebrate and applaud the incredible contribution that these people are making to Warren’s life and to our country, but instead this Government have deducted £60 a month from their housing benefit, because they live in a bungalow with three bedrooms, one of which is deemed a spare bedroom, chargeable under the bedroom tax. They asked the Prime Minister to visit them in their home and see why they needed that room. Warren’s grandfather said:
“If he”—
the Prime Minister—
“saw how we were living he would end the tax straight away. But of course he hasn’t been to see us”.
I have seen this “spare bedroom”, which is crammed with special equipment for Warren and a sofa bed for respite carers to use. There is nothing remotely “spare” about it. Without it, the Rutherfords could not possibly do the incredible job they do of looking after Warren at home.
The bungalow has been fitted with a track system and hoist to help Warren into the bath, his bed, and on to the sofa. It would cost a fortune to replace and reinstall it if they had to move to another property. There are countless other cases like that of people whose lives have been turned upside down by this punitive and indefensible tax on bedrooms.
The Minister for Disabled People (Mr Mark Harper)
I am listening very carefully to the hon. Lady, and I think she would want the House to have all the facts. I read the details of her visit, but is it not the case that that family receive a discretionary housing payment, for exactly the reasons that we put this policy in place? They have not suffered any financial penalty from this policy at all, so perhaps she should fill the House in and give a full picture of the case, rather than tell a partial story?
Rachel Reeves
I was going to come to the discretionary housing payment, but I shall discuss it now. Leeds, where I am a Member of Parliament, received £1.9 million in discretionary housing payment in 2013-14, but it spent £2.27 million, and the Government made up the shortfall. In 2014-15, Leeds city council has been given just £2.05 million, and has been told that there is no option to apply for more. The council has put in £0.35 million of its own money, but spending to date is forecast to exceed what it has set aside, including that extra money. The point about discretionary housing payment is that there is not enough money to cover all the cases, and city councils and councils across the country have had to use their own money to make up the Government shortfall.
By its very nature, discretionary housing payment is just that—discretionary—and people only find out on a year-by-year basis whether they will receive the money. People who receive it have no certainty that they will be able to stay in their house next year or the year after that. If the hon. Gentleman can give certainty to the Rutherfords and the thousands of families across the country who receive discretionary housing payment that they will receive it next year and the year after that, that would be extremely welcome, but I do not think that he can do so.
Mr Harper
The discretionary housing payment guidance specifically makes provision for councils to make longer-term awards in cases in which it takes longer for people to adjust to the policy. My right hon. Friend the Chancellor of the Exchequer set out the extra money for DHP for the next financial year to give councils that financial certainty. We have indeed done what the hon. Lady said.
Rachel Reeves
Well, my own council has received less money from the Government this year compared with last year, so some people who received DHP last year will not receive it this year. Leeds city council says that there have been more applications for DHP this year. My understanding is that the overspend last year was £3 million, so people are applying for DHP but are just not getting it.
Mr Brian H. Donohoe (Central Ayrshire) (Lab)
One of the most ridiculous things about the tax is the fact that local authorities and local housing authorities were told that they had to build houses with two bedrooms. There are no one-bedroom houses in my constituency for rent, so how can people move in those circumstances?
Rachel Reeves
I have similar issues in my constituency, where there are 26 blocks of high-rise flats that are almost all two-bedroom flats. The council tries not to house families in that accommodation, and tries to put single people in there, because there is a feeling that a high-rise flat is not always the most appropriate place for a family to live. Many single people who have been put in two-bedroom flats in high-rise buildings have been forced to pay the bedroom tax through no fault of their own.
Barbara Keeley (Worsley and Eccles South) (Lab)
My hon. Friend has rightly raised the issues for carers such as the Rutherfords. Is it not the case that 60,000 carers should be exempt from the bedroom tax? If anyone should be exempt, it is unpaid family carers. All kinds of things have been said to suggest that they are, but they are not, and it is causing them hardship. If the Minister really believes that the Government want to fund people such as carers through the discretionary payment, they could do that now: they could exempt carers by regulation.
Rachel Reeves
My hon. Friend tabled a motion to exempt the 60,000 carers affected by the bedroom tax, but the Government blocked it, which was an unwise and disappointing decision.
Caroline Lucas (Brighton, Pavilion) (Green)
The hon. Lady is making a powerful case. Does she agree that as well as being cruel and unfair the policy is simply not working on its own terms, because the properties are not there? In Brighton, 88% of those affected have not been able to move because there is nowhere for them to move to. Four hundred households are in arrears, and in over half of those homes there are people with disabilities.
Rachel Reeves
I shall come on to statistics for one local authority to make exactly the same point.
Rachel Reeves
I shall make a little progress before taking interventions.
We have discussed the needs of carers, but we must also consider people who need safe or sanctuary rooms to protect themselves against the threat of domestic violence. There is the woman whose case is now being heard by the High Court, and whose situation my hon. Friend the Member for Plymouth, Moor View (Alison Seabeck) tried to address with her ten-minute rule Bill. Others have kept a room for sons and daughters serving in the armed forces when they are home on leave. In The Daily Mirror this morning we read about the shocking case of Maureen Bland who was forced to move out of her home to avoid the bedroom tax after her son lost his life serving our country in Afghanistan. Quite frankly, people like that should not be forced to pay the bedroom tax because of such grief and tragedy.
The bedroom tax has been cited by the Trussell Trust and others as a key driver behind the shocking growth in food bank use under this Government. A recent in-depth study published by the Trussell Trust, along with Oxfam, the Church of England and the Child Poverty Action Group, found that at one food bank, 19% of users had been hit by the bedroom tax, many of them having applied unsuccessfully for DHP. We will have an opportunity to vote on a motion on food banks later this afternoon, but Members can make a start in this debate by voting to repeal the cruel bedroom tax, which is one of the key causes of the food poverty crisis we see in our country today.
Mark Tami (Alyn and Deeside) (Lab)
My hon. Friend is making a powerful case. Perhaps the cruellest element of the bedroom tax is the fact that the stress and anguish it causes is making ill people even more ill.
Rachel Reeves
People affected by the bedroom tax are facing impossible decisions that, frankly, no one should have to make: whether to pay the bills or put food on the table; or whether to pay the rent, at the risk of getting into debt, or risk losing their home. We have seen the evidence from the Trussell Trust and the Child Poverty Action Group, but we do not have to turn to that report to see the devastating impact of this vicious policy; we need only look at the evaluation commissioned by the Government themselves. It was conducted by the centre for housing and planning research at Cambridge university and slipped out this summer, when the Government no doubt hoped no one would notice. Its findings are clear and damning.
Ms Karen Buck (Westminster North) (Lab)
London is not the area worst affected by the bedroom tax. In fact, regional variation is one of the striking things about it, because there is more overcrowding in the south and more under-occupation in the north. Despite that, we have 860 households currently affected by it. Does my hon. Friend share my astonishment that in recent years councils and housing associations, such as Westminster city council, have sold 240 one-bedroom properties, thus removing the very opportunities people need to downsize in order to avoid the bedroom tax?
Rachel Reeves
That is a really important point. Six months after the restrictions on housing benefit had been applied, only 4.5% of those affected had moved into smaller homes within the social sector, despite that being, as the report put it,
“a key aim of the policy”.
The vast majority of claimants said that they were unable to move because of their need to remain close to work, services or support networks, or simply because, like the Rutherfords, they needed the room that the Government had decided was surplus to their requirements.
The Government’s evaluation also found that a shocking 60% of those affected were in arrears. Social landlords were beginning eviction proceedings in some cases, even though they knew that their tenants could simply not afford the rent increases. Most devastating of all are the official findings on how tenants have struggled to pay the shortfall. The evaluation reported
“widespread concern that those who were paying were making cuts to other household essentials or incurring other debts in order to pay their rent”.
It reported that 57% of claimants had said that they had cut back on household essentials.
There are not many of them here, but let me say a few words about the Liberal Democrats, who took the publication of the independent evaluation as an opportunity to try to wash their hands of this notorious policy. The Deputy Prime Minister said he had changed his mind after seeing the evidence in the report that most people were unable to move in order to avoid the tax, but what did he expect? Did he expect that half a million households would find new, smaller, affordable homes and that everyone would live happily ever after?
The reality is that it was always obvious that that was not going to happen. The Government’s own impact assessment, published in June 2012, assumed that no one would move and warned that if they tried there would
“be a mismatch between available accommodation and the needs of tenants”
meaning that
“in many areas...there are insufficient properties to enable tenants to move to accommodation of an appropriate size”.
Indeed, the very report that the Deputy Prime Minister cited as the “trigger” for his attempted U-turn points out that the smaller number of moves that had taken place were actually
“higher than some had expected”
in the Department for Work and Pensions. The utter disingenuousness of the Deputy Prime Minister’s attempts to excuse his collaboration with the Tories on this issue once again confirms that we simply cannot trust a single word he says.
Geraint Davies (Swansea West) (Lab/Co-op)
Given the predictability of this and the absence of small houses to move to, is it not obvious that the objective was simply to tax the poor for being poor? It has nothing to do with moving to smaller houses; it is about punishing people who are poor because of the bankers’ errors. There is no other rationale.
Rachel Reeves
I thank my hon. Friend for that intervention.
This afternoon the amendment signed by the Deputy Prime Minister aims to remove our call on the Government to abolish the bedroom tax immediately, and instead merely “notes” that the Liberal Democrats have come up with some “proposals” to change the way the bedroom tax is implemented. We would not be supporting the amendment, because “noting” the latest Liberal Democrat “proposals” is not going to pay anyone’s rent or keep anyone in their home. What matters in this House is how Members vote, how they use the power entrusted to them by their constituents. What we on the Opposition side and people watching the debate will “note” is where Members took their stand when they had an opportunity to make a difference.
Mr David Anderson (Blaydon) (Lab)
Will my hon. Friend also note that the reason we are having this debate is exactly the one just given by my hon. Friend the Member for Swansea West (Geraint Davies)? This is about taxing the poor, because the Liberal Democrats supported not only the bedroom tax, but the cut in the rate of tax for millionaires, giving their friends a £100,000 hand-back last year.
Rachel Reeves
Yes, and it tells us all we need to know about the priorities of this Government when people earning more than £150,000 got a tax cut while another group of people, two thirds of whom are disabled, got a £14 increase in their rent that they simply cannot afford. What we will note is that there would be no bedroom tax without the Liberal Democrats. They joined the Tories in the Lobby time and again to vote it through, and they combined with the Tories again and again to block Labour’s attempts to repeal it.
In conclusion, the bedroom tax is a cruel and unfair tax that is hitting around half a million low-income households. It has left vulnerable people feeling insecure in their own homes through no fault of their own.
Andrew George (St Ives) (LD)
The hon. Lady says that ours are mere proposals, but in fact they are encapsulated pretty much word for word in my Affordable Homes Bill, which of course has the support of the House. Surely that is the route to take. What we need to do is find a consensus. If she is really as concerned about this issue as she claims to be, she should apply today’s motion to the private rented sector in the same way as it would apply to the social rented sector.
Rachel Reeves
If the hon. Gentleman is so serious about doing the right thing, I hope that he will join us in the Lobby this evening, because “noting proposals” will not pay the rent or keep people in their homes. Only by voting with Labour this afternoon can Members do the right thing and repeal this unfair and cruel tax.
The bedroom tax has pushed many into debt and to resort to food banks, and it has brought others to the point of eviction and homelessness. It is wreaking havoc with local housing policies and with the finances of social housing providers, creating extra costs and perverse consequences on all sides. It is yet another example of Tory welfare waste—wasting time and energy even as it fails to deliver the savings that were promised.
The bedroom tax will be remembered for years to come as a signature policy of this unfair, out-of-touch Government. Today we have given Members on both sides of the House an opportunity to come together and consign this cruel policy to the history books. However, if Government Members do not do the right thing and join us to abolish it this afternoon, I pledge that the first thing I will do if I am Secretary of State next May is cancel the bedroom tax, removing that symbol of the injustice we have seen under this Government. That is a fully funded commitment that we will pay for without extra borrowing by closing tax loopholes and reversing the tax breaks with which this Government have favoured the wealthy.
That will be a signal of how different things will be under a Labour Government: dealing with the deficit in a fairer way and treating those who work hard to care for the most disadvantaged and vulnerable members of our society with the decency and dignity they deserve—so different from what Government Members have done. For hundreds of thousands of families across the country, that change cannot come soon enough.
Madam Deputy Speaker (Dame Dawn Primarolo)
Have you got something to say, Mr de Bois? [Interruption.] No, you have not.
Madam Deputy Speaker
In that case, you should stand up and indicate at the normal time, rather than shouting from a sedentary position.
The Minister for Disabled People (Mr Mark Harper)
I beg to move an amendment, to leave out from “House” to end and add:
“regrets that the Government took over a housing benefit bill which was out of control, and without reform would have been more than £26 billion in 2014-15; notes that the reforms the Government has implemented have brought housing benefit spending under control and helped to tackle over-crowding and better manage housing stock; further notes that the Coalition has protected vulnerable groups through £165 million of discretionary housing payments in 2014; notes that, following the interim evaluation of the policy, the part of the Coalition led by the Deputy Prime Minister has proposed reforms to introduce other formal exemptions to the policy, including where claimants have not been made a reasonable alternative offer of accommodation; and believes that the Opposition’s failure to support the Government’s wider welfare reforms, including the wholesale abolition of this policy, is financially unsustainable, and would put at risk savings of nearly £50 billion over the present Parliament, as well as leaving people languishing in over-crowded accommodation.”
I am very pleased to move the amendment. It is interesting that the hon. Member for Leeds West (Rachel Reeves) spent so little time on how she was going to pay for this policy. When I explain a little later the costs of her policy and how her proposed ways of paying for it are not going to work, I think the House will probably realise exactly why that was. Today’s debate speaks volumes not so much about what Labour Members say but about what they do not say.
Mr Harper
No, I will not. I have barely started my speech, and I want to make sure that I finish in the 20 minutes or so that the occupant of the Chair indicated. [Interruption.] The hon. Member for Bristol East (Kerry McCarthy) says from a sedentary position that the shadow Secretary of State gave way. She gave way generously to Members on her own side of the House but not very generously to Members on our side. I am happy to give way when I have uttered more than one sentence.
Today of all days, Labour would rather talk about anything than the positive jobs figures that we are seeing. More people are in work than ever before—up by 590,000 on the year and up by 1.7 million since 2010. More women are in work than ever before— up by 300,000. More disabled people are in work—up by over a quarter of a million.
Mr Harper
Labour Members do not like to hear this, do they? Let me just finish this good news on today’s jobs figures and then I will be happy to give way to the hon. Lady. More people are in private sector jobs than ever before—up by nearly 2.2 million since 2010. At the same time, unemployment has fallen, youth unemployment has fallen, long-term unemployment has fallen, and the number of people on the main out-of-work benefits is at its lowest for 24 years.
Sheila Gilmore
Any suggestion that any Labour Member does not welcome the fall in unemployment is simply not the case. In relation to this debate, is the Minister not aware that people in work can be, and are, subject to the bedroom tax?
Mr Harper
I am very familiar with the way that the policy works, and that is why it is perfectly relevant for me to point out how many people are in work. I did not say that Opposition Members did not welcome the fall in unemployment; I simply pointed out that they do not like talking about it. It is not the only thing they do not like talking about.
Mr Harper
It is very cynical that Labour has chosen on their Opposition day to have a debate that is contrived to scare people, instead of welcoming the record employment figures. I say that because the hon. Member for Leeds West referenced a specific case, which she went through in considerable detail, but omitted to mention the very significant point that the family in question get a discretionary housing payment and so suffer no financial penalty. When I intervened on her, she still would not confirm that I was in fact right and she had omitted to share that information with the House.
Mr Harper
If one is going to lay out a case for the House, one should share all of it. Trading individual cases and trying to politicise them is not the right thing to do; we should discuss the policy. I could cite a number of cases where the spare room subsidy has led to a positive position for someone’s housing, but that is not a very sensible way of proceeding. If one is going to lay out a case, one should lay it out in full and not mislead the House. [Interruption.]
Madam Deputy Speaker (Dame Dawn Primarolo)
Order. The rest of the House might not want to listen to the Minister, but I do. If he is going to give way to a Member, he will indicate that to them. Members on both sides of the House should just chill out a little bit. Let us hear what the Minister has to say.
Madam Deputy Speaker
Order. I have just been prompted about something that I did not hear because of the row. Apparently the Minister said something about misleading the House. Did he accuse the hon. Member for Leeds West (Rachel Reeves) of misleading the House? Will he confirm that he did not say that?
Angie Bray
I absolutely appreciate the principle that we need to match housing to housing need, and we certainly need more family-sized houses for larger families. Does my hon. Friend agree, however, that for the spare room subsidy policy to work fairly, as well as effectively, there will have to be a sufficient number of one-bedroom properties for those who have to downsize to move into, so that they do not face penalties when they are trying to do the right thing but cannot?
Mr Harper
My hon. Friend makes a good and sensible point. It is worth putting on the record that there are 1.4 million one-bedroom homes across the social rented sector, with significant turnover. Sixty per cent. of social sector tenants require only one bedroom because they are single or childless couples, and local authorities and housing associations are now starting to match their new building more accurately to that profile. Seventy-seven per cent. of homes approved under the new affordable housing scheme are one or two-bedroom homes—up from 68% in the last round—and the proportion of one -bedroom homes is up from 17% to 20%. The policy is having the desired effect in terms of the building of new homes.
Mr Harper
Let me make a little more progress.
It is also worth putting on the record that, when Labour Members were in power, they increased spending on a broken welfare system by 60%. They have rejected every welfare reform that we have implemented. They are seeking immediate abolition of this policy, which restores fairness. As my right hon. Friend the Member for Banbury (Sir Tony Baldry), who is no longer in his place, said, it brings the social sector into line with a policy that Labour Members themselves advocated for the private rented sector, and it ends the unfairness of 820,000 spare rooms being paid for by taxpayers when 250,000 people were living in overcrowded homes and 1.7 million were on waiting lists, as was the case when this reform was implemented. The Government are determined to help those families as well. Numbers on waiting lists have now fallen by a fifth to 1.4 million—the lowest for a decade.
Barbara Keeley
I hate to disappoint the Minister, but I will not welcome the figures he has quoted. He is making a point about fairness. Does he think it is fair that 60,000 carers should have to pay the bedroom tax? They do not have spare rooms; they are essential rooms that they need to sleep in so that they can carry on their caring. It is cruel to keep on repeating that when 60,000 people who are struggling, unpaid, to care, and saving the state a lot of money, are not exempt from this cruel tax. Is that fair?
Mr Harper
Someone who has an overnight resident carer is exempt from the policy. To deal with particular circumstances, we have given local authorities the ability to use discretionary housing payments in what they judge to be appropriate cases. I am sorry that the hon. Lady would not welcome the news that waiting lists have fallen by a fifth to 1.4 million. That is a very welcome statistic, showing that fewer families are waiting for homes because we are now using the housing stock in the social sector more efficiently.
Alec Shelbrooke (Elmet and Rothwell) (Con)
While my hon. Friend is on the subject of fairness in the system, does he think it is fair that the Labour-run council in Leeds has spent almost £3 million on new websites, furniture and tarting up meeting rooms rather than on concessionary payments?
Mr Harper
My hon. Friend makes a good point. Local authorities obviously make decisions about how they spend money. If they have indeed spent it on the things that he mentioned rather than on assisting families, their voters can make a judgment on that when they come to make these decisions at the appropriate time. I am glad that he put that on the record.
Mr Harper
Let me make a little more progress and then I will give way again.
Labour’s motion says nothing about the costs of its proposal. That is not really a surprise. It is, of course, a fact that the removal of the spare room subsidy is saving money: £490 million in 2013-14; £525 million in 2014-15; and £830 million to date, with savings increasing in future years. Abolishing this reform would cost over £500 million a year. The shadow Work and Pensions Secretary has made an “absolute pledge” to do so, but she has no idea of how she is going to fund it.
Rachel Reeves
We did say, in 2013, how we would pay for that. There are three different measures. First, we would reverse the Chancellor’s tax cut for hedge funds announced in the 2013 Budget, which it is estimated will save £150 million. Secondly, we would reverse the Chancellor’s shares-for-rights scheme, which has opened up a tax loophole and will lead to £1 billion being lost to the Exchequer, according to the Office for Budget Responsibility. Thirdly, we would tackle disguised self-employment in the construction industry, which—again, these are Treasury estimates—will save £380 million. That would happen in every single year and more than pay for the cost of cancelling the bedroom tax.
Mr Harper
First, it is interesting that the shadow Secretary of State did not bother to share any of that detail with the House in her speech. She was trying to avoid doing so, but I am very pleased that she has put those points on the record. Let us look at the three measures.
The first proposal is to ensure that the building trade pays its fair share of tax, which the hon. Lady said would raise £380 million. In fact, the Government are already cracking down on the use of intermediaries and contrived contracts, including in construction. The changes announced in the autumn statement in 2013 are already saving more than that amount, so the revenue that Labour says it could raise no longer exists.
The second proposal, to reinstate the stamp duty reserve tax charge, would place a £160 million charge on pensions; the Chancellor did not provide a tax cut for hedge funds. That means that the impact of Labour’s tax rise would fall on pension savers and retail investors. That is the same old Labour—balancing the books on the backs of pensioners.
The last proposal, to end the employee shareholder scheme, is even better, and Members will want to listen. Labour has pledged to reverse the removal of the spare room subsidy immediately, but in 2015-16, ending the employee shareholder scheme will raise no revenue for the Exchequer.
The House can see that the three measures are not going to pay for the Labour policy. If the country were unfortunate enough to have the hon. Lady in the position so ably occupied by my right hon. Friend the Secretary of State, I am afraid that when she walked in on day one she would already have a £500 million hole in her funding, and would have to find some other way of funding the payments. The Government have capped welfare, restored fiscal discipline and seen the first real fall in welfare spending for 16 years, in contrast to more unfunded spending commitments and going back to more borrowing, more spending and more taxing once again.
Maria Miller
Does my hon. Friend share my concern about Opposition Members’ scaremongering, which may cause so much fear and concern, particularly among parents of disabled children, even though he and his colleagues have already put in place clear provision to make sure that disabled children get the support they need?
Mr Harper
My right hon. Friend, who is very familiar with this policy area, is absolutely right. We have put in place clear policies for disabled children. As in the case highlighted by the shadow Secretary of State, discretionary housing payments have been put in place specifically for cases that are complex and cannot be dealt with under the rules. Ample protection is in place for the families who need it.
There is no clearer illustration of Labour’s reckless lack of control than housing benefit. Under the previous Government, housing benefit spending increased by nearly 50% in real terms, from £16 billion to £23 billion. If we had not reformed it, spending would have risen to more than £26 billion this year. We have brought that figure down by £2 billion, and last year saw the first real-terms fall in housing benefit for a decade.
Geraint Davies
I will respond to that point. Does the Minister accept that 70% of the doubling of housing benefit in the past 10 years has been due to rent rises? The strategic solution should not be to inflate rents and housing costs, but to build more houses, which is the opposite of what he is doing. He will end up with housing benefit costs that are higher, not lower, because of his incompetence.
Mr Harper
With the greatest respect, the period during which the housing benefit bill rose so fast, as the hon. Gentleman has just said, was of course when his party was in government. He is quite right about the need to build more houses, but housing starts fell to a historical low under Labour. We have actually increased the building of new homes. Nearly 500,000 homes have been built since 2010, and a further 275,000 affordable homes will be built from 2015 to 2020. More affordable homes are planned over the next Parliament than in any equivalent period in the past 20 years. The point he makes is right, but this Government have absolutely dealt with it. Overall, the changes we have made to housing benefit will save £6 billion during this Parliament.
The removal of the spare room subsidy is a key part of the reforms. Despite some outlandish claims about its effect, it is working. In the interim evaluation, half of those affected and unemployed had looked for a job, and one in five of them intended to plan to earn more. It was alleged that the change would move people into poverty. In fact, the figures show that thousands of those affected have moved into work.
Despite the Opposition’s scaremongering about evictions and arrears, the evidence has been to the contrary. The latest statistics show—[Interruption.] If we are to have a sensible debate about such matters, it would help if people did not make outlandish claims. I listened very carefully to the intervention by the hon. Member for Westminster North (Ms Buck). It is worth remembering that, when we discussed the benefit cap, she said that huge damage would be done to the 400,000-plus working households in private rented accommodation. However, we know from work that we published this week that 41% of people affected by the benefit cap are more likely to go into work. People are doing more to find work, and the policy has actually been very successful. In London, where the highest number of people are subject to the benefit cap, very few people have actually moved, and those who have moved have not moved great distances.
Ms Buck
Perhaps the Minister will explain to the House why, in the last year alone, there has been a rise of almost 30% in the number of households forced outside the area in which they originate? That is in contradiction to the advice given by Housing Ministers for years and years that homeless households should not be placed outside their local authority.
Mr Harper
It is simply not the case that people have been pushed out of London: 84% of the capped households in inner London that have moved continue to live in the central boroughs. The idea that hundreds of thousands of people would be forced out of London is simply not true.
Sir Oliver Heald (North East Hertfordshire) (Con)
The Minister is making a point about employment and people moving into work. Is not the end of dependency a huge social change? Each one of those people has been helped by this Government.
Mr Harper
My hon. and learned Friend is absolutely right.
According to the latest statistics, landlord claims for possession across the whole social rented sector are down 14% on the year, and warrants for eviction are down 3%. Housing association rent arrears have fallen on the year, and rent collections are stable at 99%. We have not seen a mass exodus to the private sector. Social sector lettings have increased, moves from the social sector to the private rented sector have fallen—down almost 20,000 since 2010-11—and, as I have said, the cost of paying housing benefit in the private sector has fallen in real terms for the past two years, in contrast to what happened when the Labour party was in power.
As we approach the general election, we face a choice. The Opposition talk about welfare waste, but they wasted £26 billion on botched IT and lost control of welfare spending when they were in government. They also wasted the lives of a lot of our constituents. At its peak, there were 5 million people on out-of-work benefits—1 million for a decade or more—while youth unemployment increased by a half, long-term unemployment doubled in two years, one in five households were workless and the number of households in which no one had ever worked almost doubled.
Mr Harper
I will make some progress, because I am keen to allow other Members to speak.
We are now seeing record employment. Two thirds of the rise over the past year has been accounted for by UK nationals, and 95% of the increase is in full-time work. Some 600,000 people have started a job through the Work programme. More than 50,000 households have had their benefits capped, while 12,000 have moved into work or are no longer on housing benefit.
It is small wonder that Labour does not want to talk about the jobs figures, the economy or immigration. As we learnt from the recently released document, Labour’s approach is, “If you don’t want to talk about something, change the subject.” I do not blame them: it is the only thing to do with policies that are uncosted and unfunded.
This debate is a manoeuvre to avoid talking about our successful long-term economic plan of halving the deficit by the end of this year, meeting the welfare cap commitment in every year of the forecast, reducing welfare spending as a proportion of GDP, making reforms that will save nearly £50 billion over this Parliament, and restoring hard-won security, hope and aspiration to families across Britain. Having listened to the Opposition, I have one thing to say: they need more time in opposition to work out why the public do not believe they are fit for office.
Madam Deputy Speaker (Dame Dawn Primarolo)
Order. Nineteen hon. Members wish to take part in the debate, and we have to reach the wind-ups by 4 o’clock. I am going to start with a time limit of five minutes for each Back Bencher, but if there are a lot of interventions it will be necessary for that to be reduced.
Dame Anne Begg (Aberdeen South) (Lab)
I am delighted that we have the opportunity for this debate. I would actually have preferred another debate, though; on 2 April, the Select Committee on Work and Pensions published a report entitled “Support for housing costs in the reformed welfare system”. As yet, however, we have not had the Government response.
It was interesting to hear the Minister say that various things had recently been published, given that we are still waiting for that response. You will know, Madam Deputy Speaker, that the Government are normally given two months to respond to a Select Committee report, and it has been a lot more than two months in this case. Every time the Government’s response has been chased up, we have been told that it is lost somewhere in government—I am not quite sure where. Of course, a Select Committee cannot apply to the Liaison Committee for a debate if it does not have the Government response. However, today’s debate gives me an opportunity to raise some of the points that the Work and Pensions Committee made.
The Committee did not call for the scrapping of the bedroom tax, although personally I would like it to be scrapped as soon as possible, and we called it the “social sector size criteria” to try to depoliticise the matter. However, we made important recommendations about how the worst effects of that pernicious policy could be mitigated. A lot of them were about exempting particular groups that have already been mentioned in the debate—such as carers, disabled people who need extra room and anyone living in a property that has had adjustments made to it, who would probably find it impossible to move.
The Minister gave the game away when he talked about discretionary housing payments. Groups of people such as I have mentioned were clearly not meant to be included in the bedroom tax when the policy was designed; the fact that they were to get discretionary housing payments indicates that they were not meant to be caught by it. However, discretionary housing payments are what they say they are—discretionary. They are not long-term.
In reply to my hon. Friend the shadow Secretary of State, the Minister said that they had been extended to give families time to adjust, but the family that my hon. Friend mentioned cannot adjust—they need a house the size of the one they are in. A woman who has had a refuge built cannot adjust and move, because it has been specifically built for her. I cannot see why the Government persist in turning their face against sensible proposals for exemptions. They keep arguing that it is all right because people get discretionary housing payments, but those payments are not permanent. People need permanent provision for their adjustment.
The number of people across the country caught by the bedroom tax is quite staggering. In my constituency, where unemployment is really low, there are still 419 people affected by the bedroom tax. Across Aberdeen, where most people are in work—there is almost full employment —more than 1,600 are affected. The irony in such a place is that people are being forced out of a two or three-bedroom council house because of the bedroom tax, but the Government seem willing to pay even more through housing benefit in the private rented sector, because the rent on a one-bedroom house in that sector is higher than that on a three-bedroom council house.
Mr Russell Brown (Dumfries and Galloway) (Lab)
I am sure that all Members will recognise that people are being driven out of the social rented sector into the arms of private landlords. I trust the figures given by my hon. Friend and her Committee more than the ones that the Government give. Has she seen a figure for the number of people who have been driven from the public rented sector into the private rented sector?
Dame Anne Begg
I suspect that the Minister is seeking to intervene on me to tell me the figure, and I will give way to him in a moment. I suspect that across the country, if the situation is anything like in Aberdeen, the houses with fewer bedrooms are in the private rented sector. However, many people cannot afford to go into that sector, because the cap that the Government have introduced on the local housing allowance means that they cannot find anywhere that they can rent. That is despite the fact that the cap is higher than the rent they were paying when they were living in a two-bedroom council house.
Mr Harper
I apologise if the House did not spot this when I mentioned it in my speech, but moves from the social sector to the private rented sector have actually fallen. The English housing survey—I admit that this is not in Scotland—shows that they are down by 20,000 since 2010-11. The number has fallen, so people are not being driven from the social sector to the private sector. It is actually the other way round.
Dame Anne Begg
That fits with what is happening in Aberdeen. People are not going into the private rented sector, because it is too expensive. Rents are above the cap that the Government have set. The irony is that the Government are prepared to pay money up to a cap that is higher than the amount that people would be paying in rent if they were not subject to the bedroom tax. That is the important point.
It is not much good for the Minister to give the number of one-bedroom properties across the whole country, because when the Housing Minister, the hon. Member for Great Yarmouth (Brandon Lewis), appeared before the Work and Pensions Committee and was asked where the spare capacity was, he said that it was in Grimsby. That is not much good to people in Aberdeen who cannot find a house to move to.
I assure Ministers that there are no places in Aberdeen for people to move to. In fact, there is a labour shortage because there are not enough properties to allow people to come and work and live in Aberdeen. That is a real problem, and the bedroom tax does nothing to mitigate it. If anything, it makes the situation worse, because it makes people feel insecure in what should be a secure tenancy. They are often in houses that they have lived in all their lives and seen their families grow up in, but now they are either being forced to pay extra or being forced out of their houses and finding that there is nowhere else for them to go. That is why the policy is pernicious and should be scrapped.
Kwasi Kwarteng (Spelthorne) (Con)
I am pleased to follow the Chair of the Work and Pensions Committee. However, one cannot on the one hand say that people are being driven from the social sector to the private sector, and on the other argue the opposite case by saying that the number of people moving to the private sector is falling because rental prices are going up. Those are contradictory points. Members have to choose one line of attack.
Dame Anne Begg
The only choice that a person has is to stay where they are and pay the bedroom tax. That is the problem.
Kwasi Kwarteng
I am glad that that has completely cleared up how Members can argue two entirely different things.
Let us put the matter in context. There is a lot of scaremongering, wild words and passion from Opposition Members, but very little attention to the facts. The Government removed the spare room subsidy simply to equalise the situation with what was going on in the private sector. I find it absolutely extraordinary that Labour Members are saying that it is all very well to have a discrepancy between social housing and private rented housing. Let us look at some more facts. Currently, 1.4 million households are on social housing waiting lists in England alone, and nearly 250,000 families are living in overcrowded accommodation. On what planet does it make sense not to have some degree of equity or fairness between people who rent in the private sector and those in social housing?
Mr Slaughter
I am so sick and tired of listening to Tories crying crocodile tears about this. Some 822 people pay the bedroom tax in Hammersmith, and the last Conservative council sold off or demolished 500 council houses. How does the hon. Gentleman think that that possibly helped with overcrowding?
Kwasi Kwarteng
I am not aware of the details of the hon. Gentleman’s borough council, but Members across the House have widely acknowledged that there is a problem with housing supply. However, I am confused when the Labour party says that those in private rented accommodation should pay an extra amount, but that social housing should be exempt from that—and all in the context of people living in overcrowded accommodation and not having enough rooms. People come to our surgeries who are living in cramped conditions, and Labour thinks it is all very well to carry on as before.
The wider point is that even if we were running a balanced budget, this would be a legitimate subject for debate. When we add in the context of a country that is borrowing £100 billion a year—largely thanks to the efforts of the Labour party when it was in government—and when both sides of the House are trying to reduce Government expenditure, it is the financial management of the mad house not to look at welfare expenditure and try to reduce it. Again, there are facts to back this up. Without reform, the overall housing benefit bill would have risen to more than £25 billion in 2014-15, and as the Minister established, we have saved £2 billion.
Kwasi Kwarteng
Forgive me. Each and every one of those reforms and attempts to reduce expenditure have been opposed by the Labour party. It is well and truly said that Labour is the party of welfare: by my estimate, it has opposed £83 billion of welfare spending savings this Parliament. Under the previous Government it was notorious and a scandal that the maximum housing benefit award was £104,000 a year—[Interruption.] These are well-established facts; for exactly that reason, when the Government introduced the £26,000 welfare cap, it was the most popular Government policy since the second world war and since polling began. There is wide acknowledgement among the public that those reforms, although difficult, are crucial in trying to reduce the deficit and get the country back to some form of sanity in the conduct of its economy.
Ms Diane Abbott (Hackney North and Stoke Newington) (Lab)
I have listened with great attention to the hon. Gentleman’s compelling rhetoric. He spoke about the management of the mad house. Is it the management of the mad house to try to force families in houses that allegedly have too many bedrooms out of that accommodation in a borough such as Hackney, where there simply are not enough one or two-bedroom flats for them to move in to?
Kwasi Kwarteng
We have established that there is a supply problem, but what we must agree on—and the general public agree—is that reform in this crucial area was needed. Neither of the interventions that I have taken addressed the fact that there is massive overcrowding, and that a quarter of a million families are living in accommodation that is physically too small for them.
In such a situation, surely it is common sense to try to equalise and rationalise the supply. [Interruption.] It is all very well for Labour Members to shake their heads and deny there is a problem, but at least the Government have had the courage to try to address the issue. They are doing so not by applying radical new ideas, but by doing what Labour did in government when they introduced a change to private sector rental agreements. It is time for the Labour party to wise up and get real—
Madam Deputy Speaker (Dame Dawn Primarolo)
Order. This afternoon’s debate is following a sort of pattern where the Opposition shout at the Government, the Government shout at the Opposition, and then both sides complain that there has not been a proper debate. I hope that Members who continue to shout across the Chamber will resist the urge to do so and listen to the debate.
Yvonne Fovargue (Makerfield) (Lab)
Kindly commentators may say that the bedroom tax is simply an example of a short-sighted, ill-thought-out, thorough administrative mess up, but actually it is worse than that: it is cruel, nasty, and the cause of a great deal of misery and hardship. It springs from the same policy mindset as the belief that food banks are somehow an acceptable part of the social fabric in the 21st century.
The mess-up theorists are right when it comes to how the bedroom tax works, because it does not work. The Government originally said that it was all about addressing overcrowding and freeing up bigger properties for bigger families, but the reality is different. In Wigan there is a real problem in finding tenants for three and four-bedroom houses, and they are remaining empty for long periods. In fact, the voids bill has risen to £1.1 million—double that of last year—because of the time it is taking to fill those properties.
Andrew Gwynne
My hon. Friend is making a powerful point. Is part of the problem with the bedroom tax that it was retrospective in nature? Many tenants were allocated those properties and accepted them in good faith. They now find themselves trapped and having to pay bills that they did not foresee.
Yvonne Fovargue
Absolutely. It is simply not the case that hundreds of families in Wigan are packed together like sardines, waiting for people with extra rooms to move out. The Government say that it is about fairness and levelling the playing field between those in social housing and those who rent privately who cannot afford spare bedrooms. Again, that is not the case in Wigan where one-bedroom properties are much rarer and people in the private rented sector can have a spare bedroom without paying for the privilege. That is because—contrary to the myth perpetrated by Government Members—the local housing allowance does not exactly work in the same way. It was not introduced retrospectively, and it is based on the average rent in an area for the size of property. Therefore, if a family can find a larger property that remains within the LHA rate, they can rent it with no penalty, as can be the case in Wigan.
Even if it were possible for a family to move easily to a smaller property, what would be the consequences? After all, a “spare”, or to put it crudely, “extra” room measure takes no account of disabled people’s adapted homes, foster parents who need rooms to take children in, separated parents who share custody of a child, or the grandparent in my constituency—as I know, grandparents are not always pensioners—who looks after her daughter’s child while she works nights. She would have to move.
Kerry McCarthy (Bristol East) (Lab)
I have had situations in Bristol where the housing department has decided that someone needs a second bedroom, but the housing benefit people have said that they are eligible for the bedroom tax. On one hand it is judged that someone does need an extra room, but on the other they are told that they have to pay for it. Is that not grossly unfair?
Yvonne Fovargue
Absolutely, and that is the problem with a discretionary payment. Do we really want people to move every time their circumstances change? Let us look at it logically. A young couple move into a one-bedroom flat. They have a child so they move to a two-bedroom flat. Then they have another child. The children start school and can share a bedroom for a certain time, but when the first child is older the family move again to a three-bedroom property. Then, when the eldest child is 18, they move back to the two-bedroom flat. Then they go to a one-bedroom flat. Is that not a sure way to break down communities, take away social cohesion and spoil children’s education just when they need it? However, that point is academic, because, as I said, there just are not the properties available for people to move around like that. People are not chess pieces.
Perhaps the Government know that. This is not really about overcrowding, but saving money. Even by that yardstick, however, it still does not work. The Department for Work and Pensions assessment has been downgraded a number of times. It now appears that the cost of dealing with the debt, eviction, abandonment of properties and widespread misery and mental health problems caused by this pernicious tax might mean that cash savings are minimal or non-existent.
Yvonne Fovargue
Not at the moment.
Debt, eviction and widespread misery are what we are talking about. They are the result of the Government’s reform. People have not been given a choice. If they cannot move to a property with fewer bedrooms, they have to make up the rent difference themselves. For tenants in Wigan, the financial impact ranges from nearly £10 a week to nearly £25 a week, or £1,273 a year. That is a lot of money to find on a low income. As I said, they cannot move because there is a shortage of housing, so they have nowhere to go, are staying put and building up debts. One clear consequence of the policy is the build-up of rent arrears. Figures from my constituency demonstrate that 44% of under-occupation households were in arrears in March 2014. The amount of arrears from the 3,319 households was £381,000, with £225,000 solely attributable to the under-occupation charge. That is not a good outcome for a local authority trying to balance its budget, and it is not good for the people themselves, who are at risk of being evicted because they simply cannot find the extra money to pay their rent. It is bad for tenants and it is bad for the councils that are trying to balance compassion with getting the money in. The only alternative to building up debts is to cut down on essentials, such as heating and food. I think we can certainly conclude that the bedroom tax has played its part in pushing people towards food banks, which have surely become the defining image of the Government in their dying days.
It is not too late for the Government to do the right thing and scrap this cruel and unfair tax. It has not given them what they wanted—budget savings—and has not helped to end overcrowding or make our housing system fairer. All it has done is to make poor people more stressed and desperate, living with the constant uncertainty of discretionary housing payments. I stress the word “discretionary”, because there is nothing certain about them at all. The human cost of the policy does not justify any savings that may have been made. I urge Government Members to look at that at Christmas and vote with the Labour party.
Andrew George (St Ives) (LD)
It is a pleasure to follow the hon. Member for Makerfield (Yvonne Fovargue). She is well respected as a knowledgeable expert on these issues. She said that the under-occupancy penalty is cruel and described the mindset of those who would introduce such a policy. Presumably, that is the same mindset that introduced this policy into the private rented sector and reinforced it. My record on this issue can be seen on a number of occasions, including on the Affordable Homes Bill, which received a 75-vote majority in this House on 5 September. My opposition to the under-occupancy penalty has been consistent throughout, including during the previous Labour Government.
It is not the fault of those who are in housing need that successive Governments have failed to build enough homes of the right size, and they should not be made to pay the penalty for that. It would be nonsense to move disabled people from homes that have been converted, often expensively at taxpayers’ expense, only to have to do it all over again in another property. It is rare in my constituency, and I know in many others, to find a suitable alternative home within 20 or 30 miles. It is wrong that people who have a settled life in a local community should have to uproot themselves from their social and family, and other supportive, connections to meet the requirement of this unacceptable policy.
The fundamental moral point is that the poor are just as entitled to a stable family home as the better off. There are many circumstances where apparent under- occupancy is for a good reason: the visiting carer; the young nest returner coming back to a family home—something that middle-class people expect to offer to their younger people—after perhaps not getting on in life as they anticipated; and those who provide shared care. We should be encouraging housing associations and other social housing providers to build larger homes. When I worked in this sector, I always sought to ensure that social housing providers had some flexibility. Having larger homes provided flexibility in the management of their estate. This policy drives them in the opposite direction. I fear there is also a sinister agenda to create an environment in which poor families will ultimately turn on their poor neighbours and blame them if they are living in overcrowded accommodation, rather than looking further afield to find the real culprit.
Mr Jim Cunningham (Coventry South) (Lab)
What happened to the hon. Gentleman’s private Member’s Bill? How was it stopped? He mentioned poorer families. What is the actual cost? Is it costing £15 or £25 a week for those families who have to move?
Andrew George
It is already on record as 14% and 25%, depending on the number of rooms. I am concerned about the trading of statistics in the debate so far. I have to say that they are far away, and wildly so, from many of the statistics I have scrutinised when looking at the impact of the policy. They need to be traded in a calmer environment.
Andrew George
There is a division between Liberal Democrats and Conservatives on this issue, and I think it will be amplified now.
David Rutley
I want to make a separate and important point. We have a very creative local housing association in our area, Peaks & Plains, which has established pop-up business schools to enable more people to set up their own businesses and become established on their own two feet. Does the hon. Gentleman believe that that, and other policies from the Government Benches such as the new enterprise allowance, is helping more people to get established and be better able to take care of their housing costs?
Andrew George
I think that is slightly outwith the focus of the debate. Nevertheless, I of course acknowledge the merit of what the hon. Gentleman suggests.
The Conservatives have form when it comes to spending public money on the under-occupancy of residential property. After all, the last time they were in government on their own they introduced a council tax discount for second homes. Hundreds of millions of pounds of taxpayers’ money was spent every year subsidising the wealthy to have their second homes, when there were thousands of local families who could not afford their first home. That defines the Conservatives’ approach: they reward the wealthy when they under-occupy their second home and they penalise the poor when they under-occupy their council home.
The Conservatives claim that the purpose of the under- occupancy penalty is to save money by cutting benefit where the recipient occupies a property that is larger than they need, and to ensure the efficient use of a scarce public resource—social housing. Those two objectives, however, contradict each other. If the second objective—the effective use of public resource—were achieved and every last cubic centimetre of every council house was fully occupied, it would fail to meet their first objective of saving money.
I have a problem with the Labour party’s motion, partly because it deals only with the social sector, which is odd. If Labour had applied it to the private rented sector, I might have considered voting for it. Above all, I am concerned to deal with this issue seriously. We can either play party politics and come up with the kind of motion the Labour party has come up with today, or we can use the vehicle that is available, the Affordable Homes Bill. Although my amendment has not been accepted for debate, we should still be working together to seek political consensus to help the victims of this policy, instead of using them to score party political points, and that could be done with the money resolution necessary to advance my Bill. The Minister asked how we would pay for it. We could pay for it by driving down rents, rather than driving people out on to the streets. On the money resolution, I am afraid—
Madam Deputy Speaker (Dame Dawn Primarolo)
Order. Will the hon. Gentleman stop talking about the money resolution and get on with it?
Andrew George
The money resolution concerns my Affordable Homes Bill, which would address this issue, were we to solve the problem with the money resolution.
In conclusion, we should be seeking consensus, rather than scoring party political points.
Madam Deputy Speaker
Order. I am now reducing the time limit to four minutes, and there is a serious danger that some Members will not get to speak even with a four-minute time limit if we do not start making better progress.
John Robertson (Glasgow North West) (Lab)
This is a tax by any other name. It is horrendous and pernicious, as was said, and targets some of the most vulnerable people in our communities. It attacks the elderly, the disabled, families of all sizes and, above all else, those already struggling to get by day after day. I am incredibly saddened to see that my city of Glasgow is one of the worst affected in the whole UK: 12,000 people in Glasgow have been hit by the bedroom tax, including 2,000 in my constituency alone. That is too many.
Sandra Osborne (Ayr, Carrick and Cumnock) (Lab)
Does my hon. Friend think that the Secretary of State learned anything when he visited Easterhouse in Glasgow and listened to what he was told about the level of poverty there?
John Robertson
The one thing we know about Ministers, who are having a wee chat among themselves, is that they do not listen to anybody. That is the problem with the Government. They sit and have their little chats because they are bored by the common people in the Opposition trying to help them. [Interruption.] They can say what they like, but that is how it looks to me.
John Robertson
The Minister is right, except for one thing: it was thanks to the Labour party north of the border frightening the Scottish Government into it. [Interruption.] They are having a wee chat again, but that’s okay. He misses the whole point. This is about people who care. It is about a side of government he does not understand. The Opposition worry about people who do not have much. Whether they live in Scotland, Wales, Northern Ireland or England, I still care about the people of this country. I am a United Kingdom Member of Parliament, and I will look after everyone within this nation.
I want to mention a couple of cases. John, a disabled man, lives on his own and has two teenage kids at school. He wants to keep in touch with his family—he wants them to be a part of his life, and he wants to be a part of theirs—so he keeps a bedroom ready for them so they have the freedom to visit at weekends, to stop in on the occasional weekday and to come and go as they please. He desperately wants to keep his family together, but moving to a one-bedroom house would end that freedom for him and his children. I cannot imagine the hurt and anger I would feel, as a father of three, if I had to tell my children or my grandchildren what John now has to tell his kids: that they cannot come and stay, even to look after him when he is not well. That is due to this Tory-led Government—make no mistake about that. It is the Tories who have done this.
I know the Minister said he did not want to hear about cases, but I will mention another one. I know why he does not want to hear about cases: because they are about real people, people we care about but they do not—[Interruption.] They are having a little chat again. A constituent of mine, Christina, wrote to me and explained her situation. She is a self-employed 60-year-old who lived in her house for 19 years with a son who recently moved out. She gets by in life, but gives all the time she can to voluntary work in her community, and she suffers from mental health issues. She feels safe in her home and in her community. She is not opposed to downsizing, and she understands that another family might need the two bedrooms more than she does, but she cannot afford to move: she cannot afford the new white goods she would need in a new home; she cannot afford to furnish and decorate a new home; and she cannot afford a removal van to take her possessions with her. Most importantly, however, she cannot afford the £41 a month she will need to make up the difference. For people such as Christina, it is literally a choice between rent and food.
Madam Deputy Speaker, I have taken two interventions already, and I do not want to take up any more time. I think I have made my point. This pernicious tax on the poorest in our society has to be got rid of, and if the Government, with their friends on the Liberal Benches, will not do it, we will.
John Howell (Henley) (Con)
I am amazed that the Labour party wishes to portray the withdrawal of the spare room subsidy in the light it does. It seems to have forgotten that it introduced similar rules in the private rented sector, as was illustrated by my right hon. Friend the Member for Banbury (Sir Tony Baldry). Difficult decisions have not been made regarding the social housing stock; instead they have been ignored.
It is appropriate that tenants make a contribution towards their rent if they are living in accommodation that is too large. As I will illustrate, the majority of tenants in the district I represent agree with this change, which will bring the social housing sector into line with the private rented sector. With that in mind, I looked at how the change was affecting people in the district in which I live. This debate needs that level of analysis to show that the charge is not affecting many people and that there is widespread agreement on the need for tenants to contribute to their rent, which we are all paying for, or to move out of houses that are seen to be too large for their needs.
There are almost 7,000 recipients of housing benefit in my district, of which almost 3,000 are in the private rented sector, which leaves 4,000 in the public rented sector. At the beginning of April 2013, the total number of social tenants having their housing benefit cut by the withdrawal of the spare room subsidy came to 474. By September 2014, this had fallen by 27%. In April 2013, the numbers affected amounted to 7% of the housing benefit case load; by September 2014, this had fallen to 5%. That is not a lot, but I believe passionately that the interests of those affected should be looked after.
For that reason, I looked at the discretionary housing payments. In the first period, 212 people applied for DHP. Of these, 139 received awards, leaving a total of 79 who applied but were rejected. Of those 79, only one appealed, and the officer’s decision was upheld. This year, the number of applications dropped from 212 to 40. Awards were made to 27; 13 were refused. Of those in receipt of DHP in July 2014, more than half accepted they needed to make up the deduction, while a total of 32% had either moved to a smaller property or returned to work and were no longer eligible for housing benefit. This is in a constituency where the unemployment rate has successfully dropped to 278.
Social housing tenants accept that they need to contribute to their rent or find work. Furthermore, there has been no significant impact on homelessness, and there remains an ongoing duty to accommodate homeless people. In 2012-13, homelessness stood at 44; in 2013-14, it stood at 40; and in 2014-15, it stood at 34. By the end of 2013-14, the level of rent arrears stood at 1.7% against a target of 2%. There is no denying that the spare room subsidy has affected a number of households, but the impact has not been widespread and many are accepting that they need to share the costs of this accommodation. That is in a district that is building accommodation that is suitable for people to move to as quickly as possible.
Jack Dromey (Birmingham, Erdington) (Lab)
Eighteen months ago, on a brilliant spring morning, a Meriden grandmother, Stephanie Bottrill, got up, sat down at her kitchen table, wrote notes to her son, her daughter, the grandson she adored and her friends and neighbours, fed the cat, put the keys through a neighbour’s door and then walked three miles through the early dawn light to the M6, where she threw herself under a lorry and committed suicide. The last straw for Stephanie Bottrill was having to pay the bedroom tax.
What kind of Government causes such pain to decent men and women? Once in a generation there is a tax so bad that the next generation looks back and asks, “Why did they do it?” Such was the poll tax, and now we have the bedroom tax. To add insult to injury, on the very day the bedroom tax was introduced the Government gave millionaires a £100,000 tax cut. In Birmingham, more than 10,000 households have been hit hard, 1,529 in my constituency, with an average loss of £16.42 to the most vulnerable and with some losing as much as £1,400 a year. A quarter of them are disabled. Who benefits? The Chancellor, because as far as he is concerned we have seen a weekly reduction in housing benefit of £179,000, with him netting £9 million a year while 10,000 people lose out.
Let me give some brief examples from my constituency. Terry lives in a two-bedroom house with his wife, and he has to have a separate room because she needs specialist breathing apparatus at all times. They have had to pay the bedroom tax because they are in a two-bedroom home. Brian lives in a two-bedroom property and was desperate to move to a one-bedroom property to avoid paying the bedroom tax. He tried time and time again, but he could not do it because there were only 43 available in the whole of Birmingham for in excess of 10,000 households.
Robert Flello (Stoke-on-Trent South) (Lab)
On that point, in Stoke-on-Trent, there is nowhere for the 2,700 families affected by the bedroom tax to go. There are no other properties for them to take.
Jack Dromey
My hon. Friend is absolutely right. They are trapped, having to pay the bedroom tax whether they like it or not.
A third constituent, Nicky, lives with her husband in a two-bedroom property. Her husband is a paraplegic and they are unable to share a bedroom, which is why they are in a two-bedroom house. They, too, have to pay the bedroom tax.
The Opposition are all in favour of reducing the housing benefits bill, but housing benefit is being pushed up by low wages and high rent. I met a young mother in the food bank in the Baptist church at the end of Erdington High street. She is in work, doing two jobs, but she is on poverty pay and is having to claim housing benefit as a consequence.
There are also not enough homes in our country. In government, we built 2 million homes and 500,000 affordable homes, but under this Government we have the lowest level of house building since the 1920s. Tens of thousands of people all over the country are trapped in homes in which they have often lived for decades, having to pay a retrospective tax and struggling as a consequence.
In conclusion, Government Members, particularly those on the Front Bench, just do not get it. They just do not understand the pain that has been felt as a consequence of their actions. The Secretary of State has often affected a damascene conversion on the road to a Glasgow housing estate, yet now he is presiding over pain on a grand scale to tens of thousands of decent men and women in this country. He has sat there throughout this debate with a Cheshire cat smirk on his face, oblivious to the consequences of his actions. This is a cruel, callous tax and one of our first acts as a Labour Government will be to confine it to where it richly deserves to be: the dustbin of history.
Alec Shelbrooke (Elmet and Rothwell) (Con)
What is depressing about this debate, which we have time and again, is that it calls for a policy that was invented by the Labour party to be reversed and does not offer any solutions for moving forward with the welfare state. We should take such opportunities to get out of the soundbite bingo and to get on with making policies that might help to tackle the long-term problems.
Out-of-control welfare spending leads to the situation that we find in countries not too far away—in Ireland, perhaps. In real terms, public pay, pensions and benefits had to be cut significantly to regain control of the public finances. There is nothing just about running an economy in that way, because when eventually people need to rely on the welfare state—which we, as the sixth richest nation in the world, should be proud of—they cannot, because the governing body of the day has destroyed the economy and left no money.
In these times, we lose sight of the original five evils laid down in the Beveridge report: squalor, disease, want, ignorance and idleness. We have tackled many of those, and we must ensure that we do not go backwards, but we are in danger of placing an increasing burden on the modern welfare state while still operating a system invented a long time ago. We need new thinking about how best to deliver efficiently and about ensuring that the resources we have are used in the best way to tackle poverty.
On 18 December 2012, I introduced a ten-minute rule Bill on the subject of a welfare cash card to pay benefits to all recipients of benefits in this country, in work or out of work, through electronic means. I have spent the two years since then researching some of the criticisms made at the time, the practicalities and how the idea could move forward. I thank the Joseph Rowntree Foundation, Oxfam, the Trussell Trust and the Money Advice Service for the discussions they have had with me.
A key point about electronic payment is the speed at which it can focus resources where they need to be and deal with one of the key problems that emerges in our discussions about housing benefit. The Trussell Trust highlighted the problem of people having to choose whether to eat and the problems caused by delays in benefit payments, which can sometimes lead to people having to go to a food bank. Electronic payment would allow immediate upload; there would be no delay.
It is sad that a dogmatic approach, saying that we absolutely cannot have such cards because they are equivalent to food vouchers, stops new thinking about efficient ways of using the state. If we do not move to a modern system, and if we do not move away from a system of barter like that in the Bible, quite frankly, we run the risk of making the system completely unworkable. We must therefore use debates such as today’s sensibly to consider how the welfare state can move forward to deliver the needs that people have when they hit hard times. That is what this debate is about. It is about how the Government can support people. Simply saying that we need to pour in more money and to reverse policies will leave us with a situation in which the welfare state will be inoperable because the country has gone bankrupt. We see this all around Europe, where people in the greatest need do not get the support they need.
Hywel Williams (Arfon) (PC)
The Minister began his contribution this afternoon with the good news about unemployment. He made a case for giving the full picture, so this is a message for both Front-Bench teams—the one that has overall charge of the economy, and the one that has charge of the economy mainly in Wales. In the last quarter, unemployment in Wales went up by 8,000. That is indeed the full picture.
I welcome the motion. The bedroom tax is one of the most ill-thought-out policies brought about since the poll tax, and I think it should be abolished with immediate effect. The under-occupancy penalty, if we must call it that, has been applied to about half a million people, more than 60% of whom have a disabled member and the vast majority of whom have absolutely no hope of downsizing in order to avoid the penalty. In fact, in Wales, 35,000 households have been affected. Many of them were allocated their current homes a very long time ago—and they are their homes, which is a very important point. They are homes—not properties or just houses—where people live and have lived for a very long time.
Before the bedroom tax was first proposed, I asked the then Minister what assessment had been made of the elasticity of the local housing supply in the private sector in Wales. I asked whether the Government had thought about it beforehand. Tellingly, the answer was “none”. The Government’s motive was to cut. People could neither move nor take in a lodger, and no attempt was made to prepare people to move to smaller houses if needed. This was and is a ruthless money-saving exercise. Those of us who warned of the implications of the bedroom tax beforehand and opposed it from the very start take absolutely no pleasure in saying, “We told you so”—but that is the case.
Ministers have been keen to point to the discretionary housing payment fund, saying that it is helping to fill the gap. The average DHP funding per head in Britain is £2.83. In Wales it is £2.51—in marked contrast with comparable areas such as the north-east of England, where it is £2.80, and Scotland, where it is £5.39. I shall return to that point later. Ministers have sought to reassure us by saying that the DHP fund will receive an extra £40 million in the next year. Given that rents are rising again, I have some doubt about whether that will fill the gap and, as has been said, that is not long-term funding.
Looking back to the Welfare Reform Bill in early 2011—now the Welfare Reform Act 2012—I note that Labour Members abstained on Second Reading. Their action speaks for itself. In early 2013, it was left to Plaid Cymru, the Scottish National party and the Green party to use one of our few Opposition day slots to have a debate on the bedroom tax and then to force a vote on its abolition. That was down to my party, the SNP and the Green Member.
When, early in 2014, the finances allowed it, the SNP Scottish Government implemented a top-up from their budget in order to mitigate the effects of the bedroom tax. The Government of Scotland, voted for by the people of Scotland, were protecting their people from the worst excesses of a Westminster Government for whom they did not vote. Many of us in Wales naturally turned to our own devolved Government to see what they would do. Again, it was left to Plaid Cymru to push in the National Assembly for mitigation of the cuts to council tax benefit—thanks to the efforts of my colleague, Rhodri Glyn Thomas, AM.
Labour could have recognised that the bedroom tax was affecting the most vulnerable and implemented mitigation measures, but it chose not to do so. It did choose to allocate some money to the smaller houses—357 houses in all of Wales, to be precise, while 35,000 households are affected by the spare room subsidy. The Welsh Government could have implemented a no evictions policy, but chose not to do so. Leaving all that aside, I think the people of Wales can clearly see that it is Plaid Cymru in Wales, the SNP in Scotland and the Green party that have led on this matter—and they will act accordingly at the general election.
Heather Wheeler (South Derbyshire) (Con)
As always in these debates—we have had a few of them—I rely on the statistics and figures from my outstanding South Derbyshire district council, which has retained housing. In the first 12 months of this policy, 318 tenants were affected and needed help. The council was proactive, employing a tenants sustainability officer to help to ensure that all the relevant benefits were being paid to those who needed help. I am delighted to tell the House that, over the last 12 months, only 73 tenants have been affected by the policy. That is an outstanding achievement. I am incredibly proud of the council.
A number of factors came into play. The council has been very proactive in using the discretionary housing budget. When it had used about 80% of its allocation, the Government offered more money to affected councils. It put in a bid and was given more money, and has now used more than 80% of the grand total—the larger amount. The council understands about keeping communities together and about dealing with carers and disabled people.
There is another crucial reason for the fact that the situation in South Derbyshire has completely and dramatically changed. This is, of course, a groundhog day debate, but it proves yet again that the Opposition are hardly worthy of the name. One of the reasons for that dramatic change—apart from our having a caring Conservative council—is the huge drop in our unemployment figures. In May 2012, 1,402 people in South Derbyshire were unemployed; in November 2014, 517 signed on. The point is that this Government believe that work should pay, this Government believe that people should have every opportunity to get back into work, and this Government are sitting on the fact that the number of tenants affected by this policy has fallen from 318 to 73.
Alec Shelbrooke
Does my hon. Friend agree that, as a result of the tough decisions on welfare that the Government had to make and the lower borrowing rates that they have now produced, we can give businesses the tax cuts that will enable them to pay more than the minimum wage and hopefully go further, thus helping the poorest in society to get on?
Heather Wheeler
Absolutely. I do not know whether you will allow me to give my hon. Friend a proper answer, Madam Deputy Speaker, because this is slightly off the point, but two major companies have factories in my constituency. One is Faccenda, whose turkey-processing plant is very busy at the moment, and the other is Nestlé. Both have announced publicly that no one working in those factories will earn less than the living wage. They are taking the lead, and that is the moral thing to do.
I am incredibly proud of my businesses, my council, and the tenants who have found the right way to obtain jobs and get out of the welfare benefit society that the Opposition seem to want to make everyone pay for. It should not be like that. Get into the 21st century, guys!
Mr David Anderson (Blaydon) (Lab)
I speak as chair of the all-party group for muscular dystrophy, and as one who knows families who have been devastated by the disease. They have written to me asking me to convey their views, and to describe to the House what they experience every day.
This policy has caused a huge amount of concern to most disabled adults, including those with muscular dystrophy or related neuromuscular diseases. Many disabled people and their families who require adapted housing and special access to accommodate their needs have been hit hardest by the bedroom tax, as it is more widely known. That applies particularly to people who live on their own or with a partner. They may need extra space for vital home adaptations and equipment storage, as well as space that enables carers to stay overnight. If appropriate new housing cannot be found for those people, they face a stark choice. They must force themselves to move to properties that have not been adapted, or remain in their houses and make a number of cutbacks or fall into debt.
Let me give the House some examples that people have asked me to give. Denise is affected by a progressive muscle-wasting condition known as myotonic dystrophy. She lives in a two-bedroom flat with her husband, who acts as her primary carer. Following the Government’s reforms, Denise was told that her housing benefit would be reduced in April. However, the fluctuating nature of her condition makes it necessary for a carer to stay overnight on occasion. The spare room is also used to store ventilation equipment, a shower chair and other equipment, and Denise’s husband uses it occasionally when it is not convenient for him to sleep with her. She must choose whether to stay there or pay the debt.
Kerry has a rare neuromuscular condition. She lives with her husband, who is her full-time carer and who also works part time. Their property contains a spare room, but Kerry is now having to pay £58.16 per month in bedroom tax, although the room is used to store her wheelchair, hoist and shower chair, and is also used by her husband at some points during the week to catch up on sleep outside regular hours. Besides the small wage her husband earns, the couple rely on benefits. That only just covers the bare necessities of life: food, utilities and rent. The cut of nearly £60 has impacted on her independence. She and her husband do not have a car, and because of the new costs, she is now unable to get out of the house. That is the reality of the bedroom tax. This is not about the to and fro of debate; this is what people are living with day in, day out.
My hon. Friend the Member for Birmingham, Erdington (Jack Dromey) said that the Conservatives do not get it. They do get it. What they get has been shown by the previous speaker, the hon. Member for South Derbyshire (Heather Wheeler). This is about creating an argument between our side and their side. They want to portray us as being the party of welfare. Well, we are the party of welfare; we are the party of the welfare state. We created the welfare state, and we did that because the Conservatives were perfectly happy to see poor people carrying rich people. That is exactly what we are seeing today, too, with people such as those I have talked about being robbed of £60 while Conservative Members’ friends get a £107,000 payout of taxpayers’ money in the previous Budget and again in this one.
It is clear what this is about. It is not about looking after people. It is about creating a dividing line, so that when the Conservatives go into the next election they can say, “We’re the party who don’t believe in welfare. Labour do.” Well, let us be clear: today we have seen clearly that Labour stands up for the poor of this country, the vulnerable and the sick. It will be interesting to see what the Liberal Democrats do, because if they get it wrong today, it will be yet another nail in their coffin when next May comes around.
Geraint Davies (Swansea West) (Lab/Co-op)
It is a great pleasure to follow my hon. Friend the Member for Blaydon (Mr Anderson). He is completely right: our party stands for a strong economy and a fair society, while the Conservatives have overseen a complete economic catastrophe, with the amount of debt escalating to 80% of the economy now.
David Morris (Morecambe and Lunesdale) (Con)
Does the hon. Gentleman agree that he and his colleagues have collective amnesia about what happened during 13 years of Labour Governments?
Geraint Davies
Share of debt has gone to 80% from 55%, the Conservative-led Government have now borrowed more in four years than we did in 13 years, and the economy is flatlining when it had grown by 40%. Their economic incompetence and the bankers’ errors are being borne on the shoulders of the most vulnerable, the most needy and, in the views of the Tories, the people least likely to vote. This is completely cynical and disastrous, in particular in poorer areas such as Wales.
In Wales, 46% of tenants are affected, versus 31% in the rest of the UK. Some 60% of people who have been inspected since a year last April are now driven into arrears, so the council has got less money still for repair and renewal. We have a situation where money has been spent on disability changes for flats and houses and those need to be decommissioned. The whole thing is horrendous.
The reason, allegedly, is twofold. One reason is housing benefit escalation, which has doubled in 10 years, but 70% of that is because of private rents going up. We need more homes. We do not need the Government, as they are doing, to use the funding for lending scheme through the Bank of England to spend more and more money on mortgages, to inflate the price of existing houses rather than building new ones. The money to small business is cut by 40% so wages, productivity and innovation do not grow. This is an horrendous, cynical and incompetent business and social experiment that is going disastrously wrong.
According to the House of Commons Library, the level of under-occupancy in the social sector is 10.2% versus 15.7% in the private rented sector and 49% in the owner-occupied sector. It is being said that people in social housing should not have homes. The reason why that rate is so low, of course, is that we build two-bedroom or three-bedroom houses and then the kids grow up and there is a part-empty home for them to be able to come back and see mum and dad or whoever. Then people die and those houses are recirculated. That is why that housing is efficiently used. In the owner-occupied sector that does not happen, of course, but the Conservatives do not care about these people on estates who need stable communities to build stable futures and jobs, and security for all of us. The whole thing is a complete disgrace.
We know that two thirds of the people affected are disabled. The Government are pretending that everything they are doing is right, but in fact they are hitting people in many different ways. For example, a couple with two children in which the woman is earning £10,000 and the man is earning £25,000 will now be losing £9,417 unless they separate. The Government have set in train incentives for families to break up as well as stripping them bare of their money.
The bedroom tax is one of the most horrendous examples of the Tories ripping the food out of the mouths of the poorest to the extent that, at Christmas time, they have to go to food banks. In Swansea, we are really being hit. The amount of money going to public servants has been frozen and the amount going into the public sector is going down. The amount of money in the local economy has been massively reduced. On the benefits side, tax credits for people on low wages are being cut, as is housing benefit. We are seeing desperate people being driven into the hands of loan sharks and having to use food banks.
This new Dickensian society that the Tories have created must be ended, and I hope that we will soon see the advent of a new, stronger Labour Government who will deliver a strong, united Britain in place of the weak, divided future that the Tories are heralding.
Dr Eilidh Whiteford (Banff and Buchan) (SNP)
Once again, we are debating the bedroom tax—the policy that I believe will come to define this Tory-Liberal Government and their four-year-long assault on people with low incomes who live with disabilities and health problems. The bedroom tax has caused real hardship for some of the most disadvantaged people. More than 70,000 households in Scotland are currently liable for the tax, 80% of which are home to a disabled adult. Those are the people who already have the least choice about where they live. They are already living in the cheapest housing available—housing that has been allocated on the basis of need, not of household size.
The bedroom tax is making those disabled and disadvantaged people the scapegoat for the systemic problems in the housing sector, as well as reducing their incomes. It is a policy that should never have happened, and I hope that people will remember, when the election comes round, that the Tories, backed up by their little helpers on the Lib-Dem Benches, were prepared to put disabled people on the front line of austerity cuts.
My colleagues and I will be pleased to support the Opposition motion today, but I have to ask those on the Labour Front Bench what took them so long. It was only in September 2013 that Labour announced that it would repeal this pernicious piece of legislation, and reports in The Guardian on 25 October suggest that the Scottish Labour leader was actively prevented from criticising the bedroom tax for a year prior to that while Labour made up its mind.
Sheila Gilmore
I understand why the hon. Lady wants to make those remarks, but I find it extraordinary that she should suggest that we did not speak out against the bedroom tax. We voted for various amendments in Committee and we voted against the Bill’s Third Reading, so it is not true to say that we did not vote against the bedroom tax.
Dr Whiteford
I did not say that Labour Members did not vote against the bedroom tax; I was talking about what was alleged in the report in The Guardian on 25 October. If that is true, it is a shocking indictment—[Interruption.] That is what I said.
I am pleased that the Scottish Government have taken action that has fully mitigated the effect of the bedroom tax for those affected this year and in the next financial year. I understand that, as of next week, the section 63 orders will be in force to allow local authorities to make discretionary payments—as they have been doing for some months on the basis of assurances—to ensure that no one in Scotland will lose out. I am relieved that tenants will no longer be experiencing hardship or accruing rent arrears due to the bedroom tax, but we should make no mistake that while it remains on the statute book, legal liability will remain with the tenants. Moreover, the £35 million that the Scottish Government have allocated to mitigate the bedroom tax this year has had to be found from other devolved budgets at a time when public spending is under pressure. So this is far from being an elegant or sustainable solution, and it is interesting to note that the Welsh Assembly has refused to go down a similar route.
The issues underlying the problems with the bedroom tax are the chronic shortage of social housing and the serious mismatch between our existing housing stock and the needs of present-day tenants. In Scotland, research by the Convention of Scottish Local Authorities has found that the implementation costs of the bedroom tax exceed the projected savings by around £10 million—money that could have been reinvested in social housing.
I recognise that the Government want to cut the housing benefit bill, but squeezing disabled tenants is a vicious way to do that. When we look closely at the increases in housing benefit over the past 10 years, we see that almost a third of the UK increase is attributable to London alone. By contrast, in Scotland the total cost of housing benefit has increased by 22% in inflation-adjusted terms over 10 years, but the increase has been much lower in the social rented sector, at only 6% over 10 years. Housing benefit inflation is being driven by out-of-control rent increases in the private sector, a problem that is most extreme in the London area.
Dr Whiteford
I will not give way again.
The problem is most extreme in the London area, so if the Government want to save money, they should address it instead of scapegoating disabled social tenants. Taking money out of the budgets of low-income households will not make more housing available, will not curb the rent increases and will not tackle overcrowding in the areas of very high demand.
As well as being a bad policy, the bedroom tax is, above all, a nasty and vindictive policy. It does not surprise me that the Tories have imposed it on us, but it is shameful that not one of the Scottish Liberal Democrats is here today to defend their Government’s policy, which they pushed through when it came before the House in the first place. This is supposed to be the season of good will, but there is a distinct lack of Christmas cheer among the people still dealing with the financial consequences of this fiasco of a policy. As the Scottish Liberals scramble to save their seats in the run-up to May, I hope that people in Scotland will remember who let the Tories do this to our most vulnerable citizens. They know that it is a failed policy—that is why they will not defend it—and it needs to be consigned to the scrap heap.
Stephen Twigg (Liverpool, West Derby) (Lab/Co-op)
When the Minister spoke at the beginning of the debate, he accused the Labour party of contriving to scare. I have to say to him that that is a gross insult to my constituents, who feel very strongly about this issue. In one ward in my constituency, Norris Green, more than 1,000 tenants are directly affected by the bedroom tax, and in total 2,500 people are affected across my constituency. With all due respect to the hon. Members for Henley (John Howell) and for South Derbyshire (Heather Wheeler), to whom I listened carefully, the scale of the challenge in a constituency such as mine is completely different from what they described in their constituencies.
An interesting piece of work has been undertaken, with those directly affected by the bedroom tax, called the Real Life Reform report. It is being constantly updated, and its latest research shows that one in eight of those involved has used a food bank at least once in the past three months. One of the most concerning findings in the Real Life Reform research is that people who are having to pay the bedroom tax are spending less on food—on average, about 10% less; the typical spend on food in September 2013 was £3.28 a day, which is hardly a massive amount of money, but the latest figure is £2.79 per day. So when we say that people are confronted with the choice of paying the bedroom tax or paying for food, we know that the research is demonstrating that for a significant number of people that means spending even less on food.
Emily Thornberry (Islington South and Finsbury) (Lab)
A constituent of mine has had a row with her daughter, who has moved out, and wants the bedroom to be left available for her daughter when she comes home. In the meantime, as she waits for her daughter to come home, she eats nothing but sandwiches, because she has to pay the bedroom tax.
Stephen Twigg
I am grateful to my hon. Friend for raising that issue, and I have encountered countless examples like that in my constituency. I am grateful to the registered social landlords in my constituency—Riverside housing, Liverpool Mutual Homes and Liverpool Housing Trust—for providing me with up-to-date information ahead of today’s debate. Let me run through some of what they have told me, some of which is different from what we heard from the Minister. I accept that the impact of this policy is different in different parts of the country, but I am speaking about what I have been told by the RSLs in my constituency.
I am told that there is a significant increase in current tenant rent arrears. Riverside housing told me that those affected by the bedroom tax are twice as likely to be in arrears with the rent as those not affected by it. LMH and LHT tell me that there has been an increase in the number of empty properties—there are more void properties. They say that that is linked mostly to prospective tenants either choosing to wait for a suitable-sized property to meet their housing need or simply being unable to afford the rent if under-occupancy is applicable, given their own family circumstances. Thirdly, housing associations are struggling to let some of their lower demand properties, as applicants are unable to make up the shortfall in rent. One of the consequences, certainly in Liverpool, is that the average re-let period has increased for those two housing associations from 27 days to 40 days—in other words, properties are left empty, so rental income declines for RSLs.
On the shift to the private sector, the experience in Liverpool is very different from the figures that the Minister shared with the House. Riverside housing tells me that of those who have moved, 30% have moved from the social rented sector as a result of the bedroom tax into the private sector. As my hon. Friends have said, that is often more expensive to the public purse because the level of housing benefit paid out in the private sector is higher, as private rents tend to be higher.
I shall conclude by saying something about discretionary housing payments. Last year, Liverpool spent £2.5 million on over 9,000 DHP awards. It spent all the money allocated by the Government, and it topped it up—there simply was not enough. The same thing is on course to happen again. The scale of need in a constituency such as mine, in a city such as Liverpool, cannot be met by the amount of money provided in DHP. We have no assurance that those housing payments are there for the long term.
A much more intelligent and straightforward policy is advocated in today’s motion, which recognises the hardship that this cruel tax has created. It recognises that it has led to an increase in household debt, and that it has hit the poorest, the most vulnerable, and disabled people. I make an appeal, even at this late stage, for Government Members to come through the Lobby with us this afternoon so that we can repeal this cruel tax.
Madam Deputy Speaker (Mrs Eleanor Laing)
Order. Members tend to forget that when they accept interventions and thus increase the time limit for their speech by a minute, they deprive their colleagues of the opportunity to speak. I have to reduce the time limit to three minutes. I call Jim Shannon.
Jim Shannon (Strangford) (DUP)
Thank you Madam Deputy Speaker. [Interruption.]
Madam Deputy Speaker
Order. If hon. Members wish to complain they will not speak at all. If the hon. Member for Nottingham South (Lilian Greenwood) takes four minutes her colleagues will not get a chance to speak. Is this a question of being selfish or of being reasonable? Mr Shannon.
Jim Shannon
Thank you Madam Deputy Speaker. It is a pleasure to add my comments to this debate.
We have discussed this issue before, as hon. Members have said. It is something that our constituents bring to our attention, and they express concern and anxiety about it. We have to highlight again in the Chamber the fact that it affects the most vulnerable people in society: parents, those suffering with disabilities, and the elderly.
I should like to give the Northern Ireland perspective. As we all know, the legislation comes straight from Westminster to Northern Ireland, and the devolved Administration and our Minister are responsible for its implementation. Earlier this year, my party took the initiative in the Northern Ireland Assembly to set aside some £18 million in our block fund money to address the bedroom tax. That has been held up by the talks process, which is ongoing at this moment. My party opposes the bedroom tax in this Chamber, and in Northern Ireland, where we have control of it, if the legislation gets beyond the talks process.
We can see how this issue affects families. We can see the problems for foster parents; for disabled families with a carer; and for families with two children of different genders, who are now required to share a room. Some 66% of existing Northern Ireland Housing Executive tenants and 62% of working-age housing benefit recipients come into the category of under-occupiers, according to information and facts in The Guardian earlier this year. Indeed, 38% of current NIHE working-age housing benefit recipients under-occupy by two rooms or more. The bedroom tax is a massive issue, and we oppose it. An article in The Belfast Telegraph has stuck in my mind. It said that
“officially, foster children don’t count as real so if yours has his/her own room, that’s also deductible…if your son or daughter only spends a few nights a week with you because’
the family relationship has broken up, that does not count. If someone has a soldier son or daughter in the Army who sometimes comes home, that does not count either.
There are many reasons why we are concerned about the bedroom tax. I am also very much concerned about discretionary housing payment. The Government say that they have set aside £30 million for that, but people will still lose benefits, with an impact of £100 million. People on disability living allowance will receive £2.51 extra a week, but they will lose £14 a week in housing benefit because of the bedroom tax. So 230,000 disabled people who receive disability living allowance will lose an average of £728 every year in housing benefit. Those figures are substantial. We must work together to ensure that those who need the most help do not lose out. With that in mind, I wholeheartedly support the motion.
Michael Connarty (Linlithgow and East Falkirk) (Lab)
Can I just say to the Minister who led for the Government that his statements were very thin? They lacked any sense of compassion. He wanted to debate numbers and affordability, but that showed that he does not really care about the impact on the people affected. I think that probably comes from the Secretary of State, so I am sorry to say that about the Minister, because I think that he set out to do his job with compassion. However, this policy clearly has no compassion built into it, apart from those parts forced on the Government by Opposition attacks, because it was even worse when it started.
The policy is punitive, and it is clearly designed to be so. In the context of modern family structures, it is clear that families dissipate much earlier than they used to, and young people increasingly want their independence, leaving parents who are not yet 60 with extra rooms that they are expected to give up, which often means moving out of their community. That is the effect of this policy.
There is a housing problem, with public housing stock being too low. Governments have not built enough public housing stock. As far as I am concerned, this basically comes down to a deliberate attack on people in hardship. There has actually been a 27% increase in housing benefit applications in the two authorities I represent, and a lot of that is because people are in work—we have heard the great boast about the fall in the number of people on the claimant register—but they are not working in a way that allows them to pay all their bills without claiming tax credits and housing benefit. That is what I have seen in my constituency surgeries over the last period.
The solution is very simple: we need to build more public housing to rent. That is clearly the priority, and I hope it will be taken up by the next Labour Government. We need to build houses that people in the public sector can rent, and we need to build them in such a way that there are smaller houses they can go to if they wish to move, because at the moment that cannot happen. I tried to ask the Minister—he would not let me intervene—how many of the 820,000 spare rooms have in fact been given up. The answer, it turns out, is 4.5%. When it comes to effectiveness, this policy is a failure. It does not work. Around 25,000 fewer people now have spare bedrooms, according to the Government.
In addition, there is the allocation system. Most authorities now have priorities for the homeless, for movers and for first-time applicants. What is happening is that homeless single people are demanding to move into apartment blocks that were designed for the elderly, and social dissonance is growing because they cannot live side by side. That is another aspect of this policy being forced on people by the Government. Single people would have taken an extra bedroom, but now they do not have that option and have to live within their means. Therefore, my pensioners are coming to me to say that people are being inappropriately housed in buildings designed for single pensioners. It is a punitive system and it must end.
Sheila Gilmore (Edinburgh East) (Lab)
The first thing I want to address is the claim that all the Government are trying to do is make the situation in the social rented sector the same as that in the private rented sector. I have revisited the debates we had when the Bill was in Committee and found not a single mention of that argument, so it is not the case that I have forgotten. Strangely enough, it was not the prime motivation for the legislation. Rather, it is one of the arguments that were made after the Government realised that the other arguments were not holding up.
Of course those arguments are not the same. There is a big difference between someone taking up a new private rented sector tenancy and knowing what size property they are looking for, as in fact has been the case since 1989—it was not introduced by the Labour Government—and someone being told that the house they have lived in for 10, 15 or 20 years is now deemed to be too big for them and that they will have to start paying extra for it right away. If this argument was about people refusing to make a reasonable move, that might be a different matter. That would be more comparable to the private rented sector.
The hon. Member for St Ives (Andrew George) included an amendment in his Bill which was initially proposed by the Opposition. Our earlier amendment went to the House of Lords and there was ping-pong on it. Unfortunately, the hon. Gentleman, who supported it at the time, could not get his colleagues to join him, or this would have been put right at the outset.
If we want to be fair to the private rented sector, perhaps we should look at other ways in which we could make the two sectors the same. However, the Government are not quite so enthusiastic about improving quality or security of tenure in the private rented sector, or looking at longer tenancy periods or limiting rent rises in the private rented sector. The Labour Government did that with things such as the decent homes standard, while in Scotland there was the Scottish housing quality standard. We want to equalise the sectors. There are many ways in which we could do that, but the bedroom tax is not the right one.
We are told that housing benefit is not rising and there has been some sort of saving. I know the Prime Minister no longer seems to be quite so keen on the Office for Budget Responsibility, but it has said that its forecasts for housing benefit spend have had to be revised on each occasion it has reported on this because of the rise in the number of people in the private rented sector, weak wage growth, and rent inflation that has been higher than expected.
Lilian Greenwood (Nottingham South) (Lab)
In March 2013, two weeks before the bedroom tax came into force, I secured an Adjournment debate to highlight the problems that this cruel and unworkable policy would create for some of the people in my city—those who were least able to afford it. I highlighted which households would be affected, with two thirds including someone with a disability, one third being families with children, more than a fifth being working households on low wages, and many having no spare room at all. They were families where older children needed their own room and a quiet place to do their homework, couples who needed to sleep separately because they were caring for a disabled partner, or separated parents who wanted to have their children to stay at weekends. For people in Nottingham, the bedroom tax would mean having to find, on average, an extra £11 a week if they had one more room than they were allowed, or £22 a week if they had two. Perhaps that is not much to a Government Minister, but for someone on low pay or out of work it is the difference between eating or going hungry, turning on the fire or sitting in the cold, borrowing money to pay the rent or going into arrears.
Back in March 2013, I was conjecturing about what would happen to those affected by the bedroom tax—but now we know. My local Labour council and its arm’s length management organisation, Nottingham City Homes, have worked hard to try to support those hit by the bedroom tax. However, by June 2014, 2,046 of the 3,445 Nottingham households hit were in arrears, owing an average of £218.71. This year, 1,393 tenants have been awarded discretionary housing payments, but they live in anxiety, worried that it could be withdrawn. The council is drawing on its own financial resources to support those affected because the allocation of £965,000 is not enough to meet the level of need.
The Government argue, as did the Lib Dem Minister who replied to my debate 21 months ago, that these people should simply move into smaller properties, but his own impact assessment said that tenant mobility was limited—as was the Government’s intention. His plan—their plan—to cut housing benefit relied specifically on the inability of tenants to move, balancing the books on the backs of poor and vulnerable people.
Nottingham City Homes has worked with tenants affected by the bedroom tax, but only 97 tenants—2.9%—were able to downsize in the year to April 2014. That compares with 81 homes freed up for families in the previous year under the Right Size project. So this flagship policy has made no difference to tackling under-occupation. The truth, as we know, is that it was never about that. It is about cuts and taking money from the households least able to afford it, at the same time as handing out tax cuts to millionaires.
People in Nottingham—people across this country—know that we cannot trust the Lib Dems, who are now wringing their hands having supported the Tories’ legislation every step of the way. Only a Labour Government will scrap this wretched tax. Next May cannot come soon enough.
Kate Green (Stretford and Urmston) (Lab)
Every time we debate the bedroom tax, it is clear that it is not achieving what Ministers said it would. As costs rise for landlords and more is spent on discretionary housing payments, as even the hon. Member for South Derbyshire (Heather Wheeler) described, the bedroom tax is not only not saving what was predicted, but, as the Minister for Employment claimed on BBC 5 Live in March, it is not about saving money anyway, but about making better use of the housing stock. The bedroom tax is clearly failing to achieve that when just 5.9% of affected households have downsized. That is hardly surprising, given the mismatch between the stock available and the number of families who are under-occupying, as has been highlighted by speaker after speaker. From Aberdeen to St Ives, from Liverpool to the north-east of England, where the number of families with spare rooms is larger than the number of overcrowded families by three to one, such a mismatch means that people simply cannot move.
The Minister for Disabled People claimed that housing waiting lists are falling, and implied that that was because of the bedroom tax. May I tell him that it has nothing to do with the bedroom tax? Waiting lists have been coming down because the eligibility criteria for housing have been tightened.
Meanwhile, individuals have experienced massive hardship, as my colleagues have described. Some 220,000 families with children, 60,000 carers and 330,000 disabled people have been affected by this pernicious tax. Most have lost £14 a week, or a total of £1,260 to date. People under-occupying by two or more rooms have lost considerably more—£25 a week—and disabled people, who also lose £14 a week, have so far lost a total of £415.8 million as a result of the bedroom tax. That is a disgraceful hit on disabled people and their households.
As a result—[Interruption.] I am coming on to discretionary housing payments, and the Minister for Disabled People will want to listen when I do. Two-thirds of those affected spent less than £40 a week on food, and less than £20 a week on fuel; according to the Disability Benefits Consortium, 12% have used food banks, and that figure rises to 15% for those hit by other cuts to welfare payments; two-thirds have struggled to pay their rent; and only 41% have been able to pay their bedroom tax in full, while 20% cannot pay it at all.
As a result, not only have some people got into arrears, but many more have gone into debt. The Real Life Reform research, which my hon. Friend the Member for Liverpool, West Derby (Stephen Twigg) mentioned, shows that 74.3% of the families it is following are now in debt. They owe on average a shocking £3,971, which is up 71.8% on the debt they had before the bedroom tax came in. That must be shameful and worrying to Ministers. They have rightly expressed concerns about rising personal debt; yet their policy is causing it. Those people have experienced rising personal debt, but it is true that their weekly repayments are lower. However, that is because credit periods have been extended and extended to the point at which nearly half those followed by the Real Life Reform research say that they have no idea how they will ever pay off their debt.
The system is riddled with injustices and cruel perversities for those affected by this tax, such as those who need space for special equipment, as described by my hon. Friend the Member for Leeds West (Rachel Reeves), and couples who cannot share a room. Those whose homes have been adapted are also affected: 35,000 such houses have been adapted, at an average cost of £6,700. The £234 million cost to local authorities is now in danger of being written off because those families are being forced out of their homes. That is another example of Tory welfare waste.
Children with high or moderate care needs are exempted from the bedroom tax, but not those with high-rate mobility. The Minister for Disabled People said that overnight carers have been exempted. That is true for overnight carers for adults, but it is not true for overnight carers for children, or for resident carers.
Despite all that, the Prime Minister said in the House on 6 March last year that disabled people were protected from the bedroom tax. That is simply not the case. As hon. Members have mentioned, nor are separated families; non-resident parents with their children visiting, whom my hon. Friend the Member for Glasgow North West (John Robertson) mentioned; those at risk of domestic violence; or the bereaved, who enjoy a 12-month so-called period of grace, which will be reduced to three months under universal credit.
It is not just individuals who are suffering. Registered social landlords are experiencing a loss of rent and are left with arrears and voids, as my hon. Friend the Member for Makerfield (Yvonne Fovargue) pointed out. That means that their credit rating and their ability to borrow cost-effectively, and therefore to build the new homes that we need, are damaged. It is an utterly illogical policy.
Government Members said that the situation was the same as for the local housing allowance in the private rented sector. That point was made first by the right hon. Member for Banbury (Sir Tony Baldry), and then by the hon. Member for Spelthorne (Kwasi Kwarteng), who might want to stop playing “Candy Crush” now, and a number of other Members. Let us be clear about the differences between the two markets and about how long the situation has pertained. As my hon. Friend the Member for Edinburgh East (Sheila Gilmore) rightly pointed out, we have had size criteria in the private sector since 1989, so they were not first introduced under Labour as Government Members suggested.
In the social sector, housing is allocated based on need. That is not the case in the private sector, in which, without criteria, people could theoretically rent any property at all. As many Opposition Members have pointed out, the local housing allowance was not introduced on a retrospective basis, and it covered pensioners. Ministers have chosen to exclude pensioners from the bedroom tax, and they have to recognise that pensioners under-occupy the majority of stock. The policy is therefore doomed to fail, and the local housing allowance is not directly comparable with it.
The Minister mentioned discretionary housing payments, but they are clearly not the answer. They are temporary, and by definition they are discretionary. As my hon. Friend the Member for Aberdeen South (Dame Anne Begg), the Chair of the Work and Pensions Committee, pointed out, for some families the idea of a discretionary payment is completely perverse given that they are living in circumstances that they simply can do nothing about. What is more, as the Chartered Institute of Housing has pointed out, discretionary housing payments are not always properly advertised, and some local authorities are discouraging people from applying or appealing. Some are treating disability living allowance, for example, as income when calculating entitlement, which hits the people affected doubly hard.
Larger cities have had to apply for additional funds for discretionary housing payments—so, it would seem, has South Derbyshire—or had to use their own resources. Some authorities that had apparently underspent now say that they need more money. Redbridge wants to carry forward its underspend, Barking says it will spend in full by the end of the year and Harrow says it will spend £41,000 more. Eight councils account for £1.2 million of failure to spend, and Wandsworth for nearly half of that. Some £30 million more than originally planned has had to be allocated through DHPs to cover the cost of foster carers, and the administrative costs to local authorities alone amount to £1 million.
How are people responding to the pressures? I heard it argued today, but without the basis of any evidence, that the bedroom tax was encouraging people to get into work, but there is no evidence that it is doing that, or, if it is, that it is getting them off housing benefit. One reason for that is self-evident: given that two thirds of those affected are sick, disabled or carers, it is very difficult for them to get into work or increase their hours. What is more, Ministers have previously suggested that people could take in lodgers, but people might not feel safe taking a stranger into their home—I know I would not—and many landlords will not allow lodgers at all. It is not possible for people to move, because there are no suitable homes in many parts of the country and many landlords will not allow people to be rehoused if they are in arrears.
The Kafkaesque proportions of this policy are beyond what we would have imagined even from this Government. It is perverse, cruel, unfair and unworkable, and it is time that it was scrapped. That will be the first action of a Labour Government, and for half a million households it cannot come soon enough.
The Minister for Pensions (Steve Webb)
Unlike the shadow Secretary of State I have listened to every speech in this debate in the hope that three questions would be answered—this is a Labour motion, and Labour Members have three questions to answer. First, how they would pay for this motion, which we recognise would cost in the order of £0.5 billion a year? The Minister for Disabled People completely demolished the hon. Lady’s argument about where the money would come from. The Leader of the Opposition said that Labour would not make any unfunded promises, but we have one before us today. The bulk of the money to pay for this motion will allegedly come from “ensuring that the building trade pays tax”, from which Labour claims we will get £380 million. It does not seem to be aware, however, that we have done that already. In the autumn statement 2013, measures to take effect in April 2014 will raise £400 million a year, so the bulk of that money has already gone.
The second point that was mentioned is reversing the stamp duty reserve tax charge, which is money from pension funds and savers. It is true that we can get money by taking it from pension funds—indeed, Labour has quite a record of taxing pension funds—but I am not convinced that that is the place to find money for welfare. The third measure Labour proposed is ending the employee shareholder scheme which, given that it wants to implement the policy in 2015-16, is rather puzzling as the policy costs nothing in 2015-16. In other words, the whole £0.5 billion is either raided from pension funds or does not exist at all.
The second question that we hoped would be answered is why it is fair to apply this principle to the private rented sector and not to social tenants. In other words, during all its time under the local housing allowance scheme, Labour was perfectly content for private sector tenants to pay for extra bedrooms, but not social tenants. When the shadow Secretary of State was briefly in the Chamber and we intervened to ask that question, she gave two reasons. The first was that the local housing allowance was not retrospective. On that basis, do Labour Members think it is okay to say that people in new social tenancies should pay for a spare bedroom? They are not saying that at all, so clearly they are inconsistent.
The hon. Lady’s second argument was absolutely bizarre. She said that people in social housing tend to have secure tenancies while those in the private rented sector tend not to. That presumably means that private rented sector tenants are more vulnerable than social tenants, yet Labour is willing to ask private tenants to pay for a spare bedroom, and not social tenants. Utterly incoherent.
The third thing I waited for in the hon. Lady’s speech—just like her leader who forgot the deficit, she forgot to say how Labour would pay for this policy—was a word that never passed her lips: overcrowding. She did not mention the plight of overcrowded people once, and we heard case studies of people affected by these measures during the debate—[Interruption.]
Madam Deputy Speaker (Mrs Eleanor Laing)
Order. People seem to be talking about all sorts of things around the Chamber. The Minister ought to be heard.
Steve Webb
Case studies were mentioned, including one from the shadow Secretary of State who then forgot to tell the House that discretionary housing payments were covering the shortfall. Let me share an example of a previously overcrowded family. Suzanna lived in a four-bedroom home in south Yorkshire when this measure was introduced, and decided to downsize. She joined the HomeSwapper scheme to find a more appropriate property and said:
“I was impressed with the quantity of matches that HomeSwapper provided…the lady I swapped with…had needed to move for a long time but her landlord had been unable to move her. She desperately needed the space for her overcrowded family.”
That is the sort of thing this policy is helping to achieve, but the voice of overcrowded tenants is not being heard in this debate.
Steve Webb
I will give way to the hon. Lady because she mentioned the situation in her constituency. Perhaps she will explain why Nottingham applied for extra cash from the Government, was given an extra £0.5 million, and did not spend it.
Lilian Greenwood
The Minister is wrong. Nottingham city has spent the whole allocation that it was given by the Government, and is having to find extra resources to help people. The Minister mentioned HomeSwapper, but that existed before the bedroom tax was introduced. His Government cut money and funding for local authorities that were pursuing projects to encourage people to downsize, including £75,000 that supported Nottingham’s projects.
Steve Webb
Nottingham was allocated discretionary housing payment and was given an additional £0.5 million, and of that combined amount it spent 78%. On the question of HomeSwapper, this policy has prompted more people to look to downsize and swap. That is an entirely good thing, as it makes better use of the housing stock.
I want to respond briefly to some of the contributions to the debate. The Chair of the Select Committee, the hon. Member for Aberdeen South (Dame Anne Begg), initially made the claim that the spare room subsidy measure was forcing people into the private rented sector. When my hon. Friend the Minister for Disabled People pointed out that the rate of moves into the private rented sector had fallen, she then said in response that people are not moving to the private rented sector because rents are unaffordable. Well, it cannot be both. It has to be one or the other.
The hon. Member for Makerfield (Yvonne Fovargue) referred to the position of foster carers, but we have recognised this particular need and provided an exemption for foster carers. The hon. Member for Glasgow North West (John Robertson) referred to his constituents as the most affected by the policy, whereas the policy—
John Robertson
On a point of order, Madam Deputy Speaker. I wonder whether you could protect this Back Bencher from a Minister making a statement that I never made. I never said we were the worst area of all. I said we were one of the worst. That is completely different. [Interruption.]
Madam Deputy Speaker (Mrs Eleanor Laing)
Order. The hon. Gentleman knows that that is not strictly a point of order. He wished to correct the record and he has done so. He has also taken up more time in this short debate.
Dame Anne Begg
Will the Minister tell my Select Committee when we can expect the Government’s response to our report on housing costs, which was published in April?
Steve Webb
Even as we speak, officials are working on it and the hon. Lady will have it shortly.
The hon. Member for Edinburgh East (Sheila Gilmore) suggested that the comparison with the private rented sector was something of an afterthought. Uncharacteristically for her, she had not read the impact assessment we published in 2012, in which we made that very point.
We heard from some of my hon. Friends about how their local authorities have been very proactive in this area. We heard how, in Henley and in South Derbyshire, local authorities had substantially reduced the number of people affected by working with tenants. That is exactly the sort of thing that we want to see.
My hon. Friend the Member for St Ives (Andrew George), to whom I pay tribute on this issue, raised whether further mitigations were needed. Let me come to that point. We have a second motion before us, the Government’s amendment, which sets out the areas on which we agree. The areas where we agree are clear: we agree that it is unfair to say to private tenants and low-paid workers not on benefit that they have to pay for a spare room, but that for social tenants there should be a blanket exemption. The coalition parties also agree that the blanket application of the policy would not have been fair. That is why we have exempted pensioners, foster families, serving personnel living at home and disabled children who cannot share a room. In addition, we accepted that further mitigation would be needed. That is why large amounts of discretionary housing payments have been found. That is why an additional fund to bid for was found in 2013-14, and why additional money was found for rural areas. There is agreement between us on that.
In the light of the summer report that indicated the impact of the policy, the Liberal Democrats took the view that further mitigation was needed. Our view is that mitigation is needed for disabled people, adults who cannot share a bedroom, and those who do not have an alternative offer of accommodation. That point is made very clearly in the amendment. I hope my hon. Friends will support the amendment.
It is very easy to put down a simple motion saying, “Let’s have some free money. Let’s spend half a billion pounds reversing a policy, with no idea where the money will come from. Let’s not address the issue of overcrowding. Let’s not address the issue of the welfare budget. Let’s simply promise the voters more money and hope that they will buy it.” Evidence shows that they will not buy it. I therefore urge the House to accept our amendment.
Question put (Standing Order No. 31(2)), That the original words stand part of the Question.
Food Banks
(10 years ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
19:00 - The House divided: - Ayes: 237 / Noes: 293 - Question accordingly negatived.
Maria Eagle (Garston and Halewood) (Lab)
I beg to move,
That this House notes that the number of people using food banks, according to the Trussell Trust, has increased from 41,000 in 2009-10 to 913,000 in 2013-14, of whom one third are children; recognises that over the last four years prices have risen faster than wages; further notes that low pay and failings in the operation of the social security system continue to be the main triggers for food bank use; and calls on the Government to bring forward measures to reduce dependency on food banks and tackle the cost of living crisis, including to get a grip on delays and administrative problems in the benefits system, and introduce a freeze in energy prices, a national water affordability scheme, measures to end abuses of zero hours contracts, incentives for companies to pay a living wage, an increase in the minimum wage to £8 an hour by the end of the next Parliament, a guaranteed job for all young people who are out of work for more than a year and 25 hours-a-week free childcare for all working parents of three and four year olds.
I welcome the Minister for Civil Society to his place in what is, I think, his first debate from the Front Bench, but I note that the Environment Secretary is not taking part in this debate. She transferred a question about food poisoning away from her Department just this week. She does not want to talk about food aid today, but she is—[Hon. Members: “Welcome!”] I would like to welcome the Environment Secretary to her place. She transferred a question about food poisoning away from her Department last week. This week she does not want to take part in a debate about food aid, yet hers is the lead Department. I just wonder what part of food policy she thinks she is responsible for.
Since the last Opposition-day debate on food banks a year ago, things have worsened. Over the past six months, there has been a 38% increase in the number of people seeking food aid from the Trussell Trust’s 420 food banks. The Trussell Trust expects the full-year numbers to be over 1 million. The report of the all-party parliamentary inquiry into hunger in the UK, entitled “Feeding Britain”, published last week, said that 4 million people are at risk of going hungry, 3.5 million adults cannot afford to eat properly, and half a million children live in families that cannot afford to feed them.
Nobody would choose to go to a food bank if they had any other option. Let us be clear about that. Research conducted by Oxfam, the Child Poverty Action Group, the Church of England and the Trussell Trust and published in November, entitled “Emergency Use Only”, indicates the truth of what many of us who have visited our local food banks have seen. People are acutely embarrassed to have to go to a food bank. They feel ashamed to have to accept such help, but the research is clear: people turn to food banks as a last resort, when all other coping strategies have failed.
The Trussell Trust says that 45% of people who visit the food banks that it operates do so because of problems with the social security system, a third because of delays to determining their benefit claims, and the rest because of benefit changes and sanctions, often unfairly applied, which have left them with no money.
Mr Jim Cunningham (Coventry South) (Lab)
Does my hon. Friend agree that it is not only people on benefits, but what we would call the working poor, who have to use food banks? That is where the increases are.
Maria Eagle
My hon. Friend is correct. I know that the two Trussell Trust food banks in my constituency have figures similar to the national average, which show that over a fifth—22% in my constituency—of people who resort to food banks for an emergency food package are in work.
Mr George Howarth (Knowsley) (Lab)
My hon. Friend will be aware of the statistics from the Big Help project in Knowsley, which covers her constituency and mine: 23% of those who receive vouchers to go to the food bank are in work—in other words, the working poor. Even more alarmingly, 45% of the vouchers issued involve children.
Maria Eagle
My right hon. Friend is correct. The figures for the Knowsley food bank, which cover his constituency and mine, are pretty similar to the figures for the south Liverpool food bank: benefit delays 28.8%, benefit changes 14.5%, and low income—in other words, poverty pay—22%. This is a problem that he and I recognise from our constituencies, and it needs to be addressed.
David Morris (Morecambe and Lunesdale) (Con)
How are those figures collected?
Maria Eagle
The Trussell Trust collects figures from the vouchers which one has to have to obtain the food aid. They are filled in by the professional or the person who refers the individual to the food bank. That is how they are collected.
Robert Flello (Stoke-on-Trent South) (Lab)
Is my hon. Friend aware of a worrying trend that I am now seeing in my advice surgeries, which the local citizens advice bureau also told me is a problem—people are not going to the food banks because they do not have the means to cook any food as they cannot afford the gas or electricity?
Maria Eagle
My hon. Friend is correct. His experience is similar to mine. I know of people who go to food banks in my constituency who hand food back that has to be cooked, and ask for food that can be prepared without the necessity for cooking. That is anecdotal; I do not know what the percentage is. There is no tick on the food voucher for that, but that is indeed happening, in my experience and that of my hon. Friend.
It is truly shocking that, according to the Trussell Trust’s figures, 45% of the ever-increasing need for food aid—or 60% according to the numbers in “Feeding Britain”—is caused primarily by the actions of the Department for Work and Pensions, yet the Department has done nothing since our debate last year to tackle the benefit delays and changes that are causing so many of the problems. I notice that no DWP Ministers are on the Front Bench today for this debate. Why has the DWP done nothing?
Stephen Mosley (City of Chester) (Con)
The hon. Lady must be aware that the number of claims being processed on time by the DWP has gone up to 93%, compared with 85% in 2010, so action is being taken. She is right to say that delays are the biggest problem, so far as food banks are concerned, but things are improving.
Maria Eagle
Well, it would be nice if a Minister from the DWP would acknowledge that delays from the Department were the cause of the problem. The hon. Gentleman is referring to—
Maria Eagle
I shall just finish responding to the hon. Member for City of Chester (Stephen Mosley), then I will give way. I had not realised that I was quite so popular. The hon. Gentleman claims that the delays are being tackled, but the DWP’s target is to determine a claim in 16 days. If someone has no money and they have to wait 16 days for their benefit claim to be determined, and then wait for the cheque to arrive, they are going to have to go to a food bank. I do not think that those targets, whether they are being met or not, are anywhere near good enough, and nor did the report, “Feeding Britain”, which suggested that claims ought to be cleared within five days.
Why are DWP Ministers not doing something about this? They appear indifferent. The Minister for Employment has said that
“there is no robust evidence linking food bank usage to welfare reform.”
That is because she refuses to collect such evidence. Either the Ministers are indifferent and incompetent, or they are indifferent and venal. In reality, they do not care enough about the problems to take any action.
Andrew Gwynne
Is my hon. Friend also concerned by the Government’s view that food banks should have a degree of permanence? I commend the work of re:dish, which distributes food in the Reddish area of my constituency. When representatives of re:dish attended a meeting with the previous Minister for the third sector, the hon. Member for Braintree (Mr Newmark), they were appalled by the view that their voluntary efforts should be there for the long term.
Maria Eagle
We ought to take note of the experience of other jurisdictions where food banks have become part of the social security system. Professor Liz Dowler of the university of Warwick carried out a piece of research—long-delayed, I might add—for the Department for Environment, Food and Rural Affairs. When she commented on it on the “Today” programme, she dismissed the idea of using surplus food as a solution to hunger, saying:
“There is no evidence from any country that has systemised using food waste to feed hungry people that it is effective. It is better to reduce”
that waste. I am concerned that what has happened in Germany and Canada could happen here—that is, that we could institutionalise dependence on food banks. Policy makers on either side of the House should be very careful before embarking on a policy that institutionalised food bank use in this country.
Mark Lazarowicz
Is it not clear that this is not just about delay and error, and that what is happening is partly a direct result of a deliberate policy? Benefit sanctions in particular have been a major cause of people going without food, sometimes for lengthy periods. That is not accidental; it is deliberate and it needs to change.
Maria Eagle
I cannot disagree with my hon. Friend. There is a deliberate attempt by DWP Ministers in this Government to sanction and stigmatise people who are on benefit.
The cost of living crisis means that people are more than £1,600 a year worse off since 2010. Living standards will be lower at the end of this Parliament than they were at its beginning. Prices have risen faster than wages for 52 of the 54 months that our Prime Minister has been in office. There are more working families living in poverty in the UK today than families with nobody in work—for the first time since records began. The cost of some food essentials has gone up in the past six years by as much as 20%. Families on the lowest incomes spent almost a quarter more on food last year than they did six years ago—they were already the families who spent the largest share of their income on food. People are now buying fewer, cheaper calories; they have been forced to trade down to less healthy, less nutritious, more processed foods.
It is not just food that has been going up in price: since 2010, people have been paying £300 more on average for energy to heat their homes and keep their lights on; water bills have gone up, with one in five people struggling to pay them; the cost of housing keeps rising, with renters now paying on average over £1,000 a year more than in 2010; and for those with children, the rising price of child care is making it harder and harder to take on work.
Yet during this time the Government have done nothing to address the cost of living crisis—and they plan much worse. Robert Chote, chair of the Office for Budget Responsibility, said plans in the autumn statement now take
“total public spending to its lowest share of GDP in 80 years.”
The Institute for Fiscal Studies says the Government’s plans would take
“total government spending to its lowest level as a proportion of national income since before the last war”.
This Tory plan to recreate 1930s Britain, along with its hunger, low pay and non-existent rights at work, coincides with changes to the labour market making it tougher to make ends meet, even for someone who is in work. The “Feeding Britain” report says that 25% of food bank users are in work and the Trussell Trust says that 22% are: increasingly, being in work is no longer a guarantee against going hungry in Britain today. David McAuley, the Trussell Trust chief executive, said that
“we’re…seeing a marked rise in numbers of people coming to us with ‘low income’ as the primary cause of their crisis. Incomes for the poorest have not been increasing in line with inflation and many, whether in low paid work or on welfare, are not yet seeing the benefits of economic recovery.”
He is correct.
Bill Esterson (Sefton Central) (Lab)
My hon. Friend mentioned that the Government have done nothing to address the cost of living crisis that so many people face, and she rightly talks about low pay. Does she agree that the effect of the Government’s policies has been to encourage zero-hours contracts, insecurity in the workplace and low pay? That has been the consequence of their policies, leading to more use of food banks.
Maria Eagle
I agree completely with my hon. Friend. The number of people in precarious, low-paid employment is increasing. According to the TUC, since the financial crisis hit only one in 40 new jobs is full-time, 36% are part-time and 60% involve self-employment. Only a quarter of those on zero-hours contracts work a full-time week, and one in three reports having no regular, reliable income. No wonder many of them end up at food banks, despite being in work. This is happening in Britain—the sixth richest country on the planet—in the 21st century. It is a scandal that is only made worse by the fact that our economy is growing again and the number of people in work is increasing. The Conservative party never stops telling us that this is what success looks like—I would hate to see its version of failure.
Sarah Newton (Truro and Falmouth) (Con)
The hon. Lady is quoting extensively from the “Feeding Britain” report, but she is missing the key point of that report, which said that it was completely wrong to play party politics with such an important issue. What the people who use food banks deserve is for us all to work together to make sure we can find a lasting solution so that nobody is left behind as we move out of this recession.
Maria Eagle
Some 45% to 60% of people’s primary reason for going to food banks is benefit delays. It is not party politics for Labour Members to ask why DWP Ministers are not tackling this absolute scandal.
Maria Eagle
I will not give way again.
Can there be a more damning verdict on the indifference, incompetence or venality of Ministers in this heartless Government, who so love to sneer and scapegoat the victims of their back-to-the-1930s ideology, than the hunger that now stalks our land and is increasing? Thousands of volunteers across our nations who help to operate food banks and who donate food to them are outraged about the plight of our fellow citizens forced to rely on food aid. Unlike the Government, they at least refuse to sit idly by and watch the suffering of the men, women and children affected without doing something positive to alleviate it. I thank them all and pay tribute to them for their fantastic effort, but it should not be necessary in this day and age for 1 million people to rely on food aid.
Maria Eagle
I will give way once more to an Opposition Member, and then to a Government Member.
Mr William Bain (Glasgow North East) (Lab)
Volunteers at my local food bank collection centre in Glasgow told me that the main reason for the surge in the use of food banks in the past year is the number of people on exceptionally low wages. Is my hon. Friend aware that the number of people in Scotland, as in many other regions and nations in the UK, on less than the living wage is rising every month under this Government?
Maria Eagle
My hon. Friend makes an important point. We have already noted the number of people who are forced to rely on food banks even though they are in work. That is not right in this day and age, and he illustrates that very well with his own experience.
Neil Carmichael (Stroud) (Con)
We all recognise the full damage that the Labour Government did to public debt, but there is another area of debt of great concern—household debt, which stacked up radically and significantly during the last years of Labour government. Does the hon. Lady think that that had any impact on what is happening now?
Maria Eagle
The reality is that debt is a reason why people go to food banks—about 13% do so—but 45% to 60% of people go to food banks because of benefit changes, disallowances and sanctions. That is part of Government policy, and something that the Government could tackle if they had the will, which they clearly do not. They refuse to accept any responsibility, despite the fact that their policies are making the situation worse. They refuse to accept that as a Government they have a moral obligation to act to alleviate these problems.
Just look at what Ministers have said. They show no understanding whatever of how a lack of money affects the lives of people struggling to make ends meet. The welfare reform Minister, Lord Freud, said last summer that
“food from a food bank—the supply—is a free good and by definition there is an almost infinite demand for a free good”.—[Official Report, House of Lords, 2 July 2013; Vol. 746, c. 1072.]
Lord Freud appeared unaware of the fact that people cannot just turn up at a food bank and get food: they have to be referred, and half of them are referred by statutory agencies. When pressed on 4 March this year in the other place, he opined that
“clearly nobody goes to a food bank willingly. However, it is very hard to know why people go to them.”—[Official Report, House of Lords, 4 March 2014; Vol. 752, c. 1215.]
From ignorance to indifference in a few short months—and he is the Minister for welfare reform. If he really does not know why people go to food banks, I can tell him: it is because they are desperate and have no food to eat and no money to buy it.
The Chancellor, meanwhile, suggested that increased awareness explained the relentless rise in food bank use. He told the Treasury Committee in July last year:
“I think one of the reasons that there has been increased use of food banks is because people have been made aware of the food bank service through local jobcentres.”
The Government Chief Whip last September preferred to suggest that it was the fault of poor people themselves:
“There are families who face considerable pressures. Those pressures are often the result of decisions they have taken which mean they are not best able to manage their finances.”—[Official Report, 9 September 2013; Vol. 567, c. 682.]
Baroness Jenkin was forced to apologise just last week for suggesting that increased use of food banks was because:
“Poor people don’t know how to cook”.
Perhaps the most revealing quote is from the sneerer-in-chief himself, the Work and Pensions Secretary, who said in January this year:
“I think it’s a positive thing for people to use food banks”.
He went on:
“There are complex reasons why people use food banks but I think it’s excellent.”
So there we have it: it is part of this Government’s strategy to replace the social security safety net, which the Work and Pensions Secretary is demolishing. He is doing this in pursuit of the ambition of the Prime Minister and the Chancellor to take us back to levels of public service spending and provision not seen since the 1930s. It is part of this Government’s ideological obsession with shrinking the state to replace social security with charity. What a disgrace!
Only by tackling the cost of living crisis can we begin to see the numbers of people relying on food banks decline. If things are going to change, the country needs a Labour Government. We will legislate to freeze energy prices and reform the market to stop energy companies from ripping people off.
Maria Eagle
No! He has not even had the courtesy to be here for the beginning of the debate.
We will introduce a water affordability scheme to support customers who are struggling, and we will give the regulator tough new powers to curb the excesses of the water companies. We will abolish exploitative zero-hours contracts and incentivise companies to pay the living wage. That will also help to increase income tax receipts and boost economic growth.
Labour will take action on low pay by raising the minimum wage to £8 an hour. We will introduce a compulsory jobs guarantee to get young people and the long-term unemployed off benefits and into paid work. We will help get parents back into work, too, by guaranteeing 25 hours of free child care a week for three and four-year-olds, paid for by an increase in the bank levy.
Labour will abolish the bedroom tax, address the huge delays in benefit payments and ensure that there are no more targets for sanctions in jobcentres. We will make housing affordable by increasing supply, building 200,000 homes a year by the end of 2020. We will support renters by introducing longer-term tenancies and banning rip-off letting fees.
That is how to tackle the cost of living crisis. That is how to build an economy that works for everyone instead of just a privileged few. That is how to reduce the number of people relying on food aid, and that is what the next Labour Government will do.
Stephen Barclay (North East Cambridgeshire) (Con)
On a point of order, Madam Deputy Speaker. I understand from the Table Office that it has had notice that the Government intend to publish tomorrow their much-delayed anti-corruption plan, which was due in June, and that the plan has been shared with third parties outside the House, but not with Members. Given the Christmas recess and the fact that Members might be leaving this evening, could you give any direction as to why Members are receiving the document after those outside the House?
Madam Deputy Speaker (Mrs Eleanor Laing)
I thank the hon. Gentleman for his very reasonable point. Of course, I have no responsibility for the actions of the Government, but I am quite sure that those on the Treasury Bench will have heard what he has said. If it is indeed the case that something that should have been reported first to the House has been published elsewhere, I am sure that Mr Speaker will take a very dim view of that. [Interruption.] The hon. Gentleman says from a sedentary position that it has not been published, but sent to others. If Mr Speaker has an opportunity to make a ruling on the matter, I am quite sure that he will say that matters that ought to be reported to the House ought to be reported first to the House, as a matter of courtesy not only to the House, but to the people we are elected to represent.
The Minister for Civil Society (Mr Rob Wilson)
I welcome the opportunity to debate this motion and thank the hon. Member for Garston and Halewood (Maria Eagle) for welcoming me to the Dispatch Box, if not for her good luck wishes. We are fortunate indeed to be informed by the report published last week by the all-party group. The members of that inquiry, including the Bishop of Truro and Members from both sides of the House, have stressed the need to ensure that partisan politics are put to one side.
Mr Wilson
I have barely started. Let me get into my speech a little more, please.
Likewise, the Archbishop of Canterbury, speaking at the launch of the inquiry report, stressed that a partisan approach would not work. I want to honour and respect that spirit in my contribution.
Mrs Lewell-Buck
On a point of order, Madam Deputy Speaker. The Minister referred to the all-party group and said we were all in agreement on various matters relating to food poverty. He is wrong. We were not in agreement; I certainly was not. I was very clear that it is problems in the Department for Work and Pensions that are driving people to food banks.
Madam Deputy Speaker (Mrs Eleanor Laing)
I appreciate the point that the hon. Lady is making, but it is a point of debate, and I am quite sure that she will have an opportunity during the debate to make it.
Mr Wilson
As I said, I want to honour and respect the spirit of the Archbishop of Canterbury in speaking at the launch.
I especially want to recognise the contributions made by my hon. Friends the Members for Truro and Falmouth (Sarah Newton) and for Salisbury (John Glen), and the right hon. Member for Birkenhead (Mr Field). The Government welcome and value their passionate but measured approach. We recognise that this is an important issue but also a very complex one. As the recent report by the inquiry showed, the reasons for the use of food aid are multi-faceted and often overlap.
It is also important to put the use of food aid in the UK into its international context. The APPG inquiry noted the development of the use of food aid in other western economies. It found that 1,000 food banks are operating in Germany and that one in seven Americans now rely on a food bank.
It is only right to start by highlighting the inspirational work of volunteers, charities, faith groups and businesses in supporting people in need, and the generosity of the public. I pay tribute to their dedication and passion.
This country has a long tradition of selfless individuals providing such help. Much of this support in communities is led by faith groups, and they have played an active role in the APPG report. My predecessors as Minister for Civil Society and I have met a number of regional groups of faith leaders to listen to their views on the use of food banks. The way that communities have pulled together shows us all how we can build a bigger, stronger society.
David Wright (Telford) (Lab)
I echo the Minister by thanking Telford Crisis Network for the work that it does on the food bank in Telford, along with a community store. He has moved very quickly on to thanking volunteers, quite rightly, but can I take him back a step? Why does he think there has been such a significant increase in the use of food banks? That is a very simple question.
Mr Wilson
I will come to the hon. Gentleman in a moment if he will let me make a little more progress, because I want to talk about a personal experience.
Last month, I visited a Tesco superstore in my constituency to thank shoppers and volunteers for all their fantastic efforts in supporting the neighbourhood food collection. The collection was held in conjunction with the Trussell Trust and FareShare, with Tesco topping up shoppers’ donations by 30%.
Mr Wilson
I was struck by the generosity of local people kindly donating items to help others. By that stage, 88 boxes had already been sent to ReadiFood, a food bank in Reading. I have visited ReadiFood and seen first hand the incredibly valuable support that it provides. I would like to take this opportunity to acknowledge the hard work, commitment and passion of everybody involved in providing food aid.
Madam Deputy Speaker (Mrs Eleanor Laing)
Order. Five people are standing and shouting at the Minister. [Interruption.] The hon. Member for Bristol East (Kerry McCarthy) will not say that people are not shouting when I say they are. If I say they are shouting, they are shouting. If the House wishes to have a proper debate, the Minister must be able to make his points, and then people can intervene. When he is ready to take interventions, he will make that clear.
Mr Wilson
I am sorry that hon. Members have not listened to my opening comments in trying to make this a sensible and serious debate where, for the sake of all our constituents, we put to one side some of our personal beliefs. However, I will give way to the hon. Member for Liverpool, Wavertree (Luciana Berger).
Luciana Berger (Liverpool, Wavertree) (Lab/Co-op)
I thank the Minister for kindly giving way. I heard what he said about attending a food collection, which obviously is not the same as visiting a food bank, although he did then say that he had been to a food bank. Will he share with the House how many food banks he has visited and how many food vouchers he has issued to his constituents?
Mr Wilson
I have visited food banks in my constituency, and I obviously hope that all hon. Members have done so in theirs. It is very important that all Members of Parliament know what is going on on the ground in their constituencies, so I advise everyone to take the opportunity to visit their local food bank if they have not already done so.
I was at the launch of the recent “Feeding Britain” report. The report is a serious contribution to this debate. It is absolutely vital to tackle food waste and ensure that surplus food is redistributed. We are determined to support food retailers, the industry and consumers in their efforts to do so. There will always be some surplus in a resilient supply chain, and we support the industry in taking forward its work to make surplus food available to redistribution charities.
On behalf of the Department for Environment, Food and Rural Affairs, the Waste and Resources Action Programme led a working group to encourage food redistribution in the industry. The group discussed the barriers to surplus food redistribution across the supply chain, and developed possible solutions. As a result, new research case studies and guiding principles were established in March to enable the industry to redistribute more.
The UK has taken a lead in Europe on food waste reduction through the Courtauld commitment. I am pleased to say that all major food industry representatives have signed up to that voluntary agreement. It includes specific targets for food waste reduction, as well as ones to encourage food redistribution. Real progress has been made. During the first two phases of Courtauld, we prevented 2.9 million tonnes of food from being wasted, worth £4 billion, and annual UK household food waste decreased by 15%, or 1.3 tonnes, between 2007 and 2012.
It is great to see the lead taken by large retailers such as Tesco and Asda. We hope that more will follow their example. I have already mentioned that Tesco is offering support to local communities, and Asda gives its overs—the surplus when more stock is received than was expected—directly to FareShare. We need to take that further. This is a moral argument, not just a sustainability issue. That is why my right hon. Friend the Secretary of State and I are convening a meeting with leaders of all major food retailers and other industry representatives.
Robert Flello
On a point of order, Madam Deputy Speaker. May I elicit your guidance? The motion does not mention food waste; it is about food banks. Food waste is completely irrelevant.
Madam Deputy Speaker (Mrs Eleanor Laing)
I am grateful to the hon. Gentleman for trying to help me. When I decide that the Minister is straying from the motion, I will make sure to tell him so.
Gordon Banks (Ochil and South Perthshire) (Lab)
May I drag the Minister back to food banks, which this debate is about? From the Government Front Bench, perhaps he can answer this question: why are many food bank users not made aware of the various crisis payments available to them in different circumstances, and why have even fewer got such payments? May we have some fact and less waffle from the Minister, please?
Mr Wilson
As the hon. Gentleman probably heard during the last debate, more than 93% of jobseeker’s allowance and employment and support allowance claims are processed on time—at the moment, that means within 16 days—which is up 7% since 2009-10. When fully rolled out, universal credit will speed that up further. In 2014-15, £94 billion will be spent on working-age benefits to support people who are on low incomes or out of work. That is a significant support network for people who need it.
Ann McKechin (Glasgow North) (Lab)
I am grateful to the Minister. May I give credit to the Greater Maryhill food bank in my constituency, which does exemplary work? It did not exist in 2009, despite the fact that unemployment in my constituency was much higher than it is now. Can the Minister explain why the use of food banks has gone up by a huge percentage while unemployment is decreasing, which he reminds us about frequently?
Mr Wilson
The reasons for people visiting food banks are complex and frequently overlapping. It is difficult to give one particular reason for the use of food banks increasing at a time when, as the hon. Lady says, unemployment is dropping rapidly in constituencies all around the country.
That brings me to an important part of my speech, on the economy. Our broad policy approach is that economic growth and employment offer the best route to give people a better future and to reduce poverty. Our country has been through the deepest recession in living memory, and the Government inherited a tough fiscal and economic situation, including the highest structural deficit of any major advanced country.
The Government have a long-term economic plan to secure Britain’s future, and sticking to it is the best way to improve living standards. Although there is more to do, that plan is working, as the Chancellor made clear in his autumn statement. There are now more people in employment than ever before, and I hope Opposition Members will welcome that fact. The economy is growing faster than any other in the G7, and we have cut income tax for 26 million people and are freezing fuel duty, cutting child care bills and providing funding for councils to freeze council tax. It is working—disposable income per capita is rising, and income inequality is down. I welcome the news this morning that not only are jobs being created and unemployment falling, but wages are rising significantly above inflation.
However, we are not complacent. There are still hard-working families facing challenging circumstances, which is why we continue to spend £94 billion a year on working-age benefits to support millions of people who are, for instance, unemployed or on low income. More than 93% of jobseeker’s allowance and employment and support allowance claims are now processed on time, within 16 days, which as I said earlier is up 7% since 2009-10. Universal credit will further speed up that processing, and the Department for Work and Pensions will do more to raise awareness of short-term benefit advances. That work will include providing more information about such advances to claimants both online and in jobcentres. We will also update staff guidance on those advances and remind staff of the process for considering them.
Fiona O'Donnell (East Lothian) (Lab)
The Minister spoke about the complexity of the reasons for the increased use of food banks. I know that he has studied the report in great detail, so can he tell the House what the top two reasons were?
Mr Wilson
As I said, the reasons are complex and frequently overlapping. If the hon. Lady has read the report herself, she will know what was in it, so I will leave her to cogitate on what the top reasons were.
We acknowledge that there is concern about prices. Following Ofwat’s 2014 price review, water bills across England and Wales will reduce by up to 5% before inflation, which is equivalent to about £20 a customer. I hope that Opposition Members will welcome that cut. As I have noted, we are freezing fuel duty, and road fuel prices are falling—they are at their lowest level since the end of 2010. It is also welcome news for consumers that year-on-year food prices have fallen, with an annual rate of inflation for food and non-alcoholic beverages of minus 1.7% in the year to November 2014.
Madam Deputy Speaker (Mrs Eleanor Laing)
Order. I have already made it clear that if the Minister says he is not giving way, he is not giving way, although he has given way several times. It does not help the debate if hon. Members shout at the Minister, because then nobody can hear the arguments. The hon. Member for Garston and Halewood (Maria Eagle) made some excellent and clear arguments, which were heard, and the Minister must have the chance to do the same.
Mr Wilson
It is disappointing that Labour Members are trying to drown out my remarks, but I return to the point that I made at the start of the speech: we need to engage with this issue in a proper, sensible debate, and I am happy to take interventions, as indeed I have done.
The Government are taking action to help hard-working families, and disadvantaged children are eligible for free school meals throughout their time at school and college. The Healthy Start scheme provides a nutritional safety net for pregnant women, new mothers and low-income families throughout the UK, and it is helping half a million families to buy milk, fruit, and fresh and frozen vegetables. The school fruit and vegetables scheme provides a daily piece of fruit or some vegetables on school days to children in key stage 1 in primary schools and nurseries attached to eligible primary schools in England.
I thank the inquiry for its hard work in preparing the recent report. This is an important issue, and the report contains a series of recommendations that should be carefully considered by the Government, the food industry, civil society and others. We will continue to engage with the inquiry as it takes the proposals forward. As Minister for Civil Society, I acknowledge once again the inspirational support provided by volunteers, charities, faith groups and businesses to help people, because too often such support goes unrecognised. The use of food banks understandably generates passion and debate from Members across the House, but all will join me in recognising the selfless dedication of everyone involved in providing food aid.
Madam Deputy Speaker (Mrs Eleanor Laing)
Order. It will be obvious to the House that a large number of colleagues are attempting to catch my eye and limited time is available. I therefore put a limit of four minutes on Back-Bench speeches.
Heidi Alexander (Lewisham East) (Lab)
When I was elected to this House four years ago, no food banks operated in my constituency. Now there are two. Every fortnight at my advice surgery I meet people who are struggling to make ends meet and who find it hard to pay the bills, cover the cost of school trips, and pay the rent. When I became a Member of Parliament I knew that many of my constituents had tough lives, but the level of poverty experienced by some in one of the richest cities in the world is shocking and should shame us all. I am appalled that in 21st-century London some people cannot put food on the table; I am appalled that some children go to bed hungry.
Mark Tami (Alyn and Deeside) (Lab)
Is my hon. Friend struck, as I am, by the fact that often people have jobs and are working as hard as they can, yet they still cannot put food on the table?
Heidi Alexander
I totally agree with my hon. Friend.
I am also appalled that some politicians claim that the increased use of food banks is somehow a symptom of more food banks being around. In recent weeks, the Education Minister in the other place told us that those who use food banks need to prioritise their spending more effectively, and the Chancellor helpfully suggested that the increased use of food banks is due to the Government advertising them more. That is out of touch and insulting. When I hear such comments, I ask myself whether those who have uttered them have ever spoken to a mum who is struggling to feed her children, because I have.
About two years ago, I started to make referrals to the Trussell Trust. I remember one woman who came back to my advice surgery a second time, asking for a second food bank voucher. She sat across a desk from me, her eyes brimming with tears, embarrassed in front of her children. She was humiliated and desperate. Food banks are not about getting a freebie or an easy option for those who want to save a couple of quid; they are the last resort for people who are often dealing with multiple, complex problems such as losing a job on top of a fluctuating mental health problem, or family break-up coupled with a series of outgoings that are simply impossible to manage.
Food banks are as much about people not being able to pay the electricity bill as they are about not being able to put food on the table. Many of the people I see at my advice surgeries tell me stories that reflect what organisations, such as the Trussell Trust, say are the main reasons for people visiting them: benefit changes and delays, debt, homelessness, unemployment and underemployment. If we want to reduce food bank usage, we have to tackle the underlying causes.
Robert Flello
I was waiting for my hon. Friend to mention sanctions. An older chap came to see me at one of my surgeries. We had just given him some vouchers, because, like her, we also issue food bank vouchers to those in desperate need. He had come to see me because he had been sanctioned again—for the third time. He has profound learning disabilities and it takes him hours to fill in an application form. The Department for Work and Pensions had sanctioned him because it said he was not trying hard enough.
Heidi Alexander
Recent research shows that benefit delays and sanctions are two of the main reasons why people visit food banks. The Minister seemed not to know that, but we all know it from our advice surgeries.
If we want to tackle more and more people going to food banks, we have to get to grips with the underlying causes. We need decent jobs that pay a decent wage; we need to build homes that people can afford to live in; we need action on energy prices; and a robust benefits system that treats people like human beings. Until we do those things, we will see food bank use continue to rise.
The two food banks that now operate from my constituency provide much-needed support to many people who are in genuine hardship. They are run by compassionate and inspiring people: Fred Esiri at the Elim Pentecostal Church and Janet Daby at the Whitefoot and Downham Community Food Plus Project. As you know, Mr Speaker, just last month the Food Plus Project won the Paul Goggins memorial prize for best civil society initiative to tackle poverty. At the presentation of the award in Speaker’s House, I was struck by words of the late Paul Goggins, which were shared with us by his son Dom:
“Poverty is an affront to our common humanity. When you see it you need to roll your sleeves up and do something.”
There are people in food banks up and down the country rolling their sleeves up and working to tackle poverty, but we in this House must take our responsibilities equally seriously.
Thousands of people visit food banks each week. There are thousands more in food poverty who never make it, and instead rely on handouts from friends and family or skip meals altogether. Food banks exist to address short-term hunger and to help people out of a crisis, but it is the Government’s responsibility to ensure that people are not routinely having to rely on charity to feed themselves and their family. The alarming rise of food banks in one of the richest countries in the world should not be brushed under the carpet. We in this place need to be honest about that. We need to roll our sleeves up and do everything we can to address it.
David Morris (Morecambe and Lunesdale) (Con)
It is a pleasure to speak under your guidance, Mr Speaker.
Not one person in this Chamber got into Parliament to make people’s lives a misery and not one person in this Chamber agrees that people should be hungry out there on our streets. [Interruption.] Millions should not be hungry, as has been said. What I want to question is the validity of the amendment. I have e-mails from the chief executive of the Trussell Trust telling me that he does not have any valid data. [Hon. Members: “What amendment?”] The motion. [Interruption.] Sorry, Mr Speaker, I am just trying to find the information Opposition Members require and that is wasting my time and wasting the House’s time, because we all know why we are here.
Food banks have been around since 2000 and it is a good job that they have been. They were actually set up under the right hon. Member for Kirkcaldy and Cowdenbeath (Mr Brown)—a fact that Labour Members seem to forget, and I welcome the fact that they are there. Let me go through some of the figures from the Trussell Trust. In the debate pack, it actually contradicts itself. It states that in 2014-15 there was a 38% increase—to 492,641—on the previous year, but that in 2013-14 the figure was 913,000. Those numbers do not stack up.
I want to read an excerpt from an e-mail I sent to the chief executive of the Trussell Trust:
“The last correspondence I had was with Adrian Curtis”—
a food bank network director—
“who told me the only figures you held were regional figures on usage and these figures were then divided by the number of food banks in the area. He said you do not hold figures for the number of individuals using the food banks and how often they need to use them and for what reason.”
Are we talking about 1 million people starving or about 1 million meals? I do not want to see any of my constituents starve—not one of them; one person in my constituency starving is one person too many. However, I take great exception to party political ploys, when the Opposition have nothing to say. I have never been invited to a food bank in my constituency, although I would love to go, yet every time this issue comes up, there is always a letter from a staged Labour source saying that MPs should do something about it. Well, I am doing something about it—I am trying to get to the truth, and the truth is that if hon. Members do not have accurate data, they do not have an argument.
As an MP, I want to know why my constituents are starving. I want to know what problems they are facing and where we can help. As the Minister correctly said, we are working with the supermarkets to get food in and to help people in genuine need, but we need accurate data, so we have to be grown up. If Opposition Members do not have accurate data, they have not got an argument. Although I sympathise with them, I do not accept that 1 million people are starving in Britain. If they were, we would be up there with the Chinese and the Indians of this world, which we plainly are not. I implore hon. Members to grow up, get decent and ensure that when they put their choices before the public, they give them the right figures.
Huw Irranca-Davies (Ogmore) (Lab)
On a point of order, Mr Speaker. I know you have just come into the Chair, so I shall be brief. The Secretary of State for Environment, Food and Rural Affairs was here at the start of the debate, but has chosen not to take part, while the Minister who I understand is to wind up the debate was not here for the opening remarks or interventions. Bearing in mind the importance of this debate, that seems disrespectful to me, as it will seem to others listening to the debate, not just us as parliamentarians. Will you give some guidance on the rules governing who should be here and when?
Mr Speaker
I am grateful to the hon. Gentleman for his point of order. I shall be corrected if I am wrong, but my understanding is that the Minister had another engagement of a ministerial and parliamentary character elsewhere on the estate—I think in Westminster Hall.
Mr Speaker
I will come back, but first let us hear what the Minister has to say.
George Eustice
I am grateful for this opportunity to explain why I could not be here for the opening comments of the hon. Member for Garston and Halewood (Maria Eagle). I was indeed representing the Government in a Westminster Hall debate on the welfare of greyhounds called by an Opposition Member, as I explained to Madam Deputy Speaker before the commencement of the debate.
Mr Speaker
It is a regrettable state of affairs, it has to be said, but the Minister has explained his position with courtesy, for which I thank him. The hon. Member for Ogmore (Huw Irranca-Davies) has put his point on the record, and people will form their own view about the appropriateness of the organisation of matters. We will leave it there.
Gordon Banks (Ochil and South Perthshire) (Lab)
In the limited time available, I would like to draw the House’s attention to the activity in my constituency.
In Clackmannanshire, we are fortunate that individuals have committed to establishing food banks at The Gate in Alloa and the drop-in food bank run by Activ8 in Sauchie. I have to say a big thank you for the dedication and foresight of people such as Evelyn Paterson, Val Rose and Sandra Gruar, because without their commitment the situation in Clackmannanshire would be a whole lot worse, while in Kinross-shire and South Perthshire, part of my constituency, people such as Les Paskin, who manages the Perth and Kinross food bank, deserve our gratitude for a venture described by the Daily Record as a “Food lifeline for Crieff”.
I want to put on the record the level of support these operations are providing to my communities. Perhaps the hon. Member for Morecambe and Lunesdale (David Morris) can listen and get some of the numbers now. In the first year of its existence, Perth and Kinross food bank provided 1,573 food parcels. That is three days’ food for 2,772 people, including 712 children, and the equivalent of 25,000 meals. The Gate has delivered 214 food packs, feeding 371 people with 7,745 meals between July and September of this year alone. At the end of October, it had supplied 21,700 meals to people in crisis in the preceding 10 months. That equates to a 35% increase in the number of people supported and a 50% increase in the number of meals supplied. The numbers show that 49% are due to benefit delay or sanction, a figure even greater than the 37% due to poverty or debt.
Kerry McCarthy (Bristol East) (Lab)
A constituent came to me on Friday who has been sanctioned for three months—that is three months without a single penny coming in. He showed me evidence that he had applied for 21 jobs on one website alone in the past three days, but because he could not show that he had handed in his CV in one particular place he was sanctioned. That is what we are dealing with. Does my hon. Friend share my disappointment that the Minister will not acknowledge that?
Gordon Banks
I share my hon. Friend’s concern about, and her abhorrence of, what is going on. I am sure that every Opposition Member has had people coming to their constituency surgeries and delivering that kind of message. It is abhorrent and it must stop.
My office in Alloa is the third biggest referrer of those in need to the Gate food bank and my constituency offices in Alloa and Crieff act not only as drop-off points for donations but as collection points for food parcels. Let me take the House back a couple of weeks. We supplied a food parcel from my constituency office in Alloa for someone who had prearranged collection. The gentleman came and collected his food parcel and one of my members of staff went out of the office a few minutes later only to find him sitting in the street outside my office eating a cold tin of spaghetti. He was that desperate.
Diana Johnson (Kingston upon Hull North) (Lab)
My hon. Friend is making a powerful speech about what is happening in his constituency. I was shocked to hear from Sarah Sidwell, who runs the food bank in Hull, that she expects a 20% increase in the number of people coming forward for food parcels in the lead-up to Christmas. Is he experiencing the same in his constituency?
Gordon Banks
I have exactly the same expectations as my hon. Friend. Indeed, later this week I will visit one of the food banks in my constituency and I am prepared for what they will tell me and for a horror story.
It was not that long ago that a man walked 7 miles to the Activ8 food bank in Sauchie for a polythene bag of food, only to have to walk 7 miles back home to provide for his family. I can honestly say that when I was first elected to this House I never foresaw a time when my constituency offices would be used for such a purpose and would have such a workload. This is a growing problem and we must do something about it.
We know that a proactive and caring Government could and would confront this shocking situation. They would do that through measures to scrap the bedroom tax, rather than voting to keep it, by growing the number of employers who pay the living wage, through the enforcement of tough sanctions on employers who do not pay the minimum wage, through a fairer approach to benefit sanctions and through a benefit system that does not seem set to make the claimant pay from the outset.
In Scotland, we have a Government who support the policies of the Conservatives in this place by refusing to support a 50p tax rate and who vote against the extension of the living wage in public contracts. In Scotland, we are hamstrung by not one but two Governments with the wrong priorities. We can do something about this, and we must, even if we have to wait until May to begin to right the wrongs.
Sir Tony Baldry (Banbury) (Con)
I hope that every Member will read the all-party report entitled “Feeding Britain”, which has 77 recommendations, all of which seem eminently practical. I think everyone would agree that we should collectively seek to ensure that benefits can be paid as quickly as possible. I was not sure whether the hon. Member for Garston and Halewood (Maria Eagle) was giving an undertaking that, if a Labour Government were elected next spring, benefits could be paid within five days. We would all want to ensure that benefits are paid as quickly as possible.
I was pleased to hear the Secretary of State for Work and Pensions announcing earlier this week that the Government were
“looking to new measures committing the Department to raising much more awareness, as was asked for, of the short-term benefit advances. We are doing that through websites, on posters and by providing information in jobcentres…hoping to roll it out at the beginning of the new year”
ensuring that advisers
“constantly advise those at risk of the availability, should they need it, of interim payments.”—[Official Report, 8 December 2014; Vol. 589, c. 633.]
We should all agree on that.
On sanctions, the report suggests the introduction of a yellow card system. No one has spoken about it as yet, but it seems an eminently sensible idea. We all know as constituency MPs that constituents sometimes get into circumstances where there is not necessarily a fair or black-or-white situation, so introducing some sort of yellow card system might be much fairer.
I caution the Opposition against trying to give the impression that there is some huge new fund of money that can be given for this purpose. Every party, so far as I can recall from when I was in the Division Lobby, voted for the welfare cap, and if the leaders of both parties are also ring-fencing payments to pensioners, it means that benefit payments to working families and so forth are inevitably going to get squeezed. I fully support encouraging employers to pay the living wage and, if we can, to raise the minimum wage, but we are all working within tight conditions.
The report makes recommendations not just to the Government, but to the food industry. Tackling food waste is an important issue, and I was slightly surprised that some Opposition Members would discount it. I was glad that, in Department for the Environment, Food and Rural Affairs questions, Ministers acknowledged that and said that they would meet industry representatives to see how better to deal with food waste. The waste and resources action programme, which is based in my constituency, is already taking a lead on this.
As to the suggestion or implication that the debate is entirely about benefit delays and sanctions, may I read in my remaining time a short extract from the Bishop of Truro’s article in last week’s Church Times? This is just one quote to show the complexity:
“The other force at work is the addiction that many individuals and families have, but which particularly sharply affects the budgeting of low-income families. A family earning £21,000 a year, for example, where both parents smoke 20 cigarettes a day will spend a quarter of their income on tobacco.”
He went on to talk about the need to address the
“circle of addiction fed by debt, at the expense of being able to put food on the table.”
These are complex issues, and I suggest that pre-election soundbites are not worthy of them. It is a pity that this evening’s debate has sometimes degenerated into a pre-election soundbite debate.
Mrs Emma Lewell-Buck (South Shields) (Lab)
I am absolutely outraged that people are going hungry in one of the richest countries in the world. We have nearly 1 million people attending food banks and over 13 million, including children, the disabled and elderly, living in poverty. Worse still, a high percentage of those 13 million people are in work, working day-in and day-out, with low pay and rising living costs.
Members will know that I was part of the all-party parliamentary group inquiry team that spent most of this year touring the country taking evidence from charities and food bank users, and also know that I sit on the Environment, Food and Rural Affairs Committee, which is holding an inquiry into food security. While this does not make me an expert, it does mean I have a broad knowledge of the growing hunger problem this country faces and the causes of it.
Mr Iain McKenzie (Inverclyde) (Lab)
Has my hon. Friend seen in her constituency as much as I have seen in my Inverclyde constituency, the distribution not only of food, but of power cards to enable people to cook the food that has been distributed to them?
Mrs Lewell-Buck
What I have seen is an increase in the number of soup kitchens in my constituency, because people do not have the equipment in their homes to cook any food.
No matter where in the country we took evidence, we heard the same stories time and again. People were using food banks because of poverty pay, welfare and benefit changes, unfair sanctions and benefit delays.
Mr Tom Clarke (Coatbridge, Chryston and Bellshill) (Lab)
My hon. Friend has rightly mentioned the problems caused by benefit changes. I recently initiated a debate in Westminster Hall about the change from disability living allowance to personal independence payments. When I telephoned my local benefits office in Bellshill, I was told that a man had been waiting for 14 months for a decision. Will she encourage the Government to accept their responsibilities, especially their responsibility for the mess at the Department for Work and Pensions?
Mrs Lewell-Buck
I entirely agree with my right hon. Friend, and I shall say something about the issue that he has raised later in my speech.
In the past, we had a welfare state with a supportive safety net. When I was unemployed, and when members of my family and I fell on hard times, I was proud to live in a country in which they and I would be able to get help. Sadly, that is no longer the case. I remain proud of my country, but not of the people who are running it. The fact is that the safety net no longer exists. Since the coalition introduced its welfare reforms, we have experienced a harsh and punitive regime. We have a culture that no longer talks to people about their circumstances or tries to understand their hardship, but sanctions them without hesitation and cuts them off from any means of financial support without a care.
Cathy Jamieson (Kilmarnock and Loudoun) (Lab/Co-op)
Will my hon. Friend give way?
Mrs Lewell-Buck
I want to make some progress.
That is not just my view, but the view of the brave people and selfless organisations that gave evidence to our inquiry. Time and again, people cited the changes in the welfare state as a primary driver to the food bank. It would be a total injustice not to acknowledge that. It is a national disgrace that food banks have become a part of the fabric of our society, but I thank God that they are there, for the truth is that, if the food banks and the faith groups were not plugging the gaps left by the state, people would be starving. There is no common sense or humanity in the system any more.
We heard from a number of agencies about the culture change at the Department for Work and Pensions. The system now exists to catch people out, not to help them. That culture change has been led by those at the top, those in the Government who want to scapegoat the poor. We see that attitude when Ministers deny that welfare reform has led to people going hungry, which completely ignores the experiences of all our constituents. Ministers accuse critics of welfare reform of playing politics. I wonder whether they would have the gall to face some of the hungry people in my constituency and tell them that. It is not playing politics; it is the reality of life in our country nowadays.
People are going hungry, and, with each passing day of this terrible excuse for a Government, more and more are falling into poverty, with little or no chance of escape. There are no second chances in Britain today. Food poverty is a clear consequence of the Government’s ideological assault on the social safety net and the people who rely on it. One hungry person is a complete disgrace, but thousands of hungry people are a national disaster. I want us to try to consign this age of hunger to the history books. I know that that can best be achieved under a Labour Government.
Jeremy Lefroy (Stafford) (Con)
Two or three weeks ago I had the honour of co-chairing the launch of a report entitled “Emergency Use Only”, compiled by the Trussell Trust, Oxfam, the Child Poverty Action Group and the Church of England. It is a balanced and thoughtful report and chimes very much with my own experience as a constituency Member of Parliament.
As time is short, I shall outline just some of the points made by those organisations. They began by considering what had caused the increasing use of food banks and they concluded that it was due to an acute income crisis. There could be a number of reasons for that crisis. The word “complexity” has rightly been used a great deal today. The income crisis could be due to factors connected with employment, or unemployment. It could be due to a change in family circumstances. But it could be due to the benefits system, and it clearly is in a number of cases. The system is complex, people have had to experience long waiting times, and there has often been a lack of clear information about why people have been sanctioned and what they must do to remove those sanctions.
Pamela Nash (Airdrie and Shotts) (Lab)
I have had to sign on myself, and I remember waiting until I was in dire straits financially before I went and did that. Does the hon. Gentleman agree that 16 days is far too long for someone to wait before receiving jobseeker’s allowance?
Jeremy Lefroy
I would agree that in many circumstances it is probably too long. Circumstances will be different for different people, but for some people it most certainly is too long.
I want to consider what we should be doing about this situation. There has been criticism of the Department for Work and Pensions. I want to make it clear that most staff in DWP do an excellent job, and most DWP staff in my constituency really do try to help the people who come before them—not everybody, but we are all human beings.
First, we should improve access to short-term benefit advances. I think the Government recognise that. I hope they will do something about it and make it clearer how people can access those advances more readily. Secondly, we should look at sanctions policy and practice. Some of the instances that have been highlighted to me of how people have been sanctioned seem, frankly, to be over the top and in some cases ridiculous—in some cases perfectly justified, but in many cases I have questioned that.
Debbie Abrahams (Oldham East and Saddleworth) (Lab)
The hon. Gentleman may be aware that the Work and Pensions Committee has decided to conduct an inquiry into inappropriate sanction use because of our significant concerns about that.
Jeremy Lefroy
There have been cases where people have had medical appointments, for example, which they cannot avoid, and so could not go to sign on, so there needs to be a bit more flexibility, while not taking nonsense from people who try to get away with things. Most of these people are not trying to get away with it at all, however.
Thirdly, the report recommends that we should improve the employment and support allowance regime, ensuring that claimants are not left without income for long periods. Fourthly, the local welfare assistance scheme is currently under review after a challenge. I urge the Government to ensure that the funding is ring-fenced, and that local authorities are not required to absorb it into their budgets, as many will find that difficult. We need that money to be ring-fenced locally for the coming financial year. I hope the Minister can respond on that, or at least indicate when we are going to hear about that.
I agree that food banks should not become a readily accepted part of formal provision. Clearly, there will always be people who get into difficulties. Being the son of a vicar in London, I remember that people would frequently come to the doorstep and ask for food. That is always the case—people do get into difficulties—but food banks should not be part of a readily accepted formal system for the long term.
The report chimes with the report presented last week which colleagues wrote. The Government should take the evidence and the recommendations seriously. Some of the recommendations should not be difficult to implement; it should merely be a matter of instructing DWP offices what they should, and should not, do in terms of sanctions.
This debate is extremely important. I am very glad that it has taken place today. I hope that Members on both sides of the House will do their utmost to ensure we improve the current situation, but ultimately it is up to the Government to look at the ways in which they can do that.
Lisa Nandy (Wigan) (Lab)
I want to start by saying that it is a pleasure to follow the hon. Member for Stafford (Jeremy Lefroy) and that I agreed with so much of what he said. I also want to say that, to be fair, the Minister is right to acknowledge, as we do on this side, that some of the problems that are propelling people in this country to food banks have deep roots and a long history that goes back beyond the time his Government have been in office. However, we simply have to acknowledge the explosion in the scale of the problem in recent years.
We cannot have a sane and sensible debate about how to resolve the problem if Ministers refuse to acknowledge that over the past four years the number of people relying on Trussell Trust food banks alone—there are many other food banks around the country—has gone up from 41,000 in 2010 to nearly a million now, and that in those years we have seen food banks such as the Brick in my constituency springing up to fill need and demand.
Many people are too frightened or humiliated to go and ask for help, and the British Red Cross—more used to working in countries torn apart by war, famine and disaster—is launching its first-ever emergency appeal in this country, one of the richest countries in the world, to feed and clothe our children. We should be ashamed of ourselves. We have to start by acknowledging that and the heartbreaking reality, as all my hon. Friends who have visited food banks in their constituencies will know, of a nation that will not feed its children.
Mr Andy Slaughter (Hammersmith) (Lab)
My hon. Friend is making a very good speech, as always. There is agreement across the House about how well food banks are performing, how well organisations such as Tesco are doing and how generous our constituents are in giving money and food to food banks. Does my hon. Friend agree that what is missing on the Government Benches is the anger at the fact that we have food banks in this country? That is what I saw when I was collecting at Tesco in Brook Green—that people are so concerned.
Lisa Nandy
The Minister’s warm words and praise for many of the charities running those food banks would be a lot more convincing if his Government had not just tried to gag them to prevent them from speaking out by passing the Transparency of Lobbying, Non-Party Campaigning and Trade Union Administration Act 2014, which we will repeal.
One of the reasons why we have such a problem is that the safety net that those charities campaigned for and that we built during the previous century has been allowed to collapse in this century. What was provided once as a right is now provided as charity. That, in the end, is what lies behind the humiliation facing many of the people forced to walk miles to go to food banks and the gnawing anxiety that they live with daily, not knowing where their next meal will come from.
Robert Flello
Is my hon. Friend as shocked as I am by a recent case, typical of so many, of a couple who told me that their mother—an elderly woman who had been feeding them because they could get no support—had had to go into hospital suffering from malnutrition?
Lisa Nandy
Indeed. My hon. Friend is right.
In the short time available to me, I want to talk about the solutions to these problems. The first solution, which tackles a long-term trend, is that work must pay. Far too many people have been forced into work that is low-wage and zero or small-hours. One of my constituents wrote to me before this debate and said that she was forced into a job where she was given, on average, only 15 minutes of work a day over the course of a week, and that £1.10 a day did not even cover the cost of her bus fare. When she left that job she was sanctioned, got into debt and ended up having to go to a food bank. The solutions are obvious: raise the minimum wage and encourage firms to pay the living wage.
When the Minister went to Tesco, did he ask that company why it does not pay all its staff a living wage? I would be interested to know. Those who claim to be part of the solution can also be part of the problem. It is the Government’s job to set the tone of what we expect from our major employers. In communities such as mine, there are real issues about the number of jobs available. If the Government do not invest to create jobs, it is no use telling people to get on their bike and go and get a job.
The second thing that Ministers must do is rebuild the safety net. I do not know whether the Minister understands how much damage the bedroom tax has done to people in communities such as mine. It must be scrapped immediately. The benefits delays that my hon. Friends have mentioned are so important. I have people in my constituency who are waiting six months just to get an assessment for employment support allowance. On top of that, the universal credit has been introduced. In principle I support it, but many people are now managing budgets that they never had to deal with before, and it has propelled many of them not just into debt, but into the arms of payday lenders—payday lenders that this Government refuse to do anything about.
If Ministers were at all interested in the experiences of my constituents, which they do not appear to be as they seem to be talking together, they would learn that the culture in the jobcentre—
The Minister for Disabled People (Mr Mark Harper)
Will the hon. Lady give way?
Lisa Nandy
No, I will not give way. It is about time Ministers listened, rather than trying to tell us that there is no problem in this country.
The cultural change that is needed in the jobcentre, which routinely strips people of their rights and their dignity, will come from getting rid of the unofficial targets for sanctions and restoring adviser discretion so that organisations can work with people, not against people, in their search for work.
I will say this to the Minister, now that he is finally paying attention to what I am saying about the experience of my constituents: what a waste this all is! He talks about food banks. Well, I will tell him something. There is a growing recognition across all the political parties that in the current economic climate we desperately need to harness the talents, the passion and the energy of people in every community, to make this country fairer, stronger, better and more sustainable. Instead, we have charities—cancer charities and children’s charities. Instead of supporting people at the hardest time of their lives, we can do little more than feed and clothe the children in one of the richest countries in the world. What a tremendous waste it all is!
John Hemming (Birmingham, Yardley) (LD)
I have visited the new food bank in my constituency and the one in Sparkhill, just outside my constituency. Both are Trussell Trust food banks and both do excellent work. I congratulate the people who work in them. I have done welfare rights for about 25 years, and I am pleased to have the opportunity to send people in crisis somewhere where they can get emergency food aid.
The Trussell Trust website tells us how the trust was founded in 1997 and how food banks were born in 2000. It tells how the founder, Paddy Henderson, received a call in 2000
“from a desperate mother in Salisbury saying ‘my children are going to bed hungry tonight—what are you going to do about it?’ Paddy investigated local indices of deprivation and ‘hidden hunger’ in the UK. The shocking results showed that significant numbers of local people faced short term hunger as a result of a sudden crisis.”
This problem is not new, but the fact that there are now food banks is a positive thing.
David Wright
I think we would all acknowledge that there has always been a problem with people and families going hungry in this country. It is nothing new, but how does the hon. Gentleman explain the huge increase in the number of people presenting at food banks in recent years?
John Hemming
One aspect of that is that people such as myself who were unable to refer anyone to a food bank before can now do so. I have always seen people in a state of crisis—[Interruption.] No, I have seen people in a state of crisis, and the Trussell Trust also confirms that this was happening in 2000.
Let us look at an example involving habitual residency. I think that the House is united in not wanting benefit tourism. However, when people leave this country to go and live abroad for five or 10 years and then come back, they do not qualify for benefits because they have not been habitually resident here. They then come to see me and I tell them that, in such an emergency, I can send them down to the food bank. I have handed out vouchers to four people. It is true that some people end up in such a state that they cannot afford to cook the food, and that is something that we need to be aware of. They often do not want to go to the food bank for that reason. Similarly, the cost of the bus fare to the food bank can also be an issue. We have to recognise, however, that the habitual residency rule is not new. It has been around for some time. The Trussell Trust refers to “hidden hunger”. We all agree with the policy of having habitual residency qualifications for means-tested benefits.
Sanctions give me cause for concern. I have sat down with senior civil servants who have told me that there are no targets for sanctions, but I have also had confirmation from people working in the Department for Work and Pensions that they are under pressure for not having issued enough sanctions. I also see people who are being wrongly sanctioned. To me, that is very wrong. The safety net should be fair but, as I have said on a number of occasions, it is not operating properly at the moment.
The hon. Member for Stafford (Jeremy Lefroy) made an excellent speech, and I support everything he said, but I would also like to emphasise the point made by the right hon. Member for Banbury (Sir Tony Baldry) about the yellow card system. The sanctioning system was originally designed to be punitive, but under the universal credit system, it is supposed to be less so. The Government have gone wrong in not having moved towards a compliance-oriented sanctions system and waiting for universal credit to bring that in. We should have changed how the system was initially set up under the previous Government. It was initially set up as a punitive system, but it should have been moved towards compliance. I would support the yellow card system, which the Trussell Trust also supports.
Again, the Labour party has to think carefully about its policy proposals. It proposes to increase the number of years someone has to work to qualify for contributory jobseeker’s allowance from two to five years. The effect of that will be to reduce the number of people who get contributory JSA, which is why the Labour party is suggesting it, but the families involved will then face exactly the same sort of crisis that will drive them to a food bank.
Let us consider what happens to a couple who are both in low-paid work and then one of them loses their job. Under Labour’s new proposals they will find themselves having an income crisis that they would not find under the Government’s current legislation. This is a complex issue of detail, and some of the Opposition’s proposals would make more people go to food banks. We need to look at how to deal with it in detail and protect people from hunger—hidden or unhidden.
Sir Gerald Kaufman (Manchester, Gorton) (Lab)
The hon. Member for Birmingham, Yardley (John Hemming) talked about Members of this House who have been around for some time. Well, I have been around for some time and I have never known a situation like this.
Last Saturday, I attended a Christmas lunch for pensioners at the Trinity House community centre in my constituency. It was a lovely occasion, but I did ask myself what kind of lunch some of the people would have been having if they had not been there. I went to a school and the head teacher told me that the meal provided for children there was the only proper meal they had all day; I had to ask myself what happens during holiday periods.
I went to the New Covenant church for a carol service last Sunday in another part of my constituency. I had a chat with the pastor and I was told of the things that were done at that church. He told me about its food programme and its food bank. He told me that the church has volunteers who work there and in the community but cannot find jobs when they have left the volunteer period.
That night, I went home and saw on television a commercial that said, “Help Unilever and Oxfam fight hunger in the UK”. I found it utterly shaming that a commercial such as that had been made, where people were saying that there was so much hunger in this country that action against it had to be organised. Despite the damage done by this Government, this is one of the richest countries in the world, and it is utterly humiliating that people should have to go to food banks to get a meal.
Kerry McCarthy
I do not know whether my right hon. Friend has yet had a chance to visit the excellent FoodCycle Manchester. I am a patron of the organisation and was at FoodCycle Bristol on Sunday. It uses food waste—surplus food—to provide meals for people who cannot afford them. For the 60 or so people I met there on Sunday, it was probably the only nutritious cooked meal they were going to get that week. I urge him to visit.
Sir Gerald Kaufman
My hon. Friend has got it right, because one sees this again and again. Why? It is because of poverty. The figures show that in my constituency 42% of children live in poverty. Mine is the 10th worst constituency for that in the whole UK. The city of Manchester is fourth in Britain for poverty, and that is according to the Department for Education’s own definition. Children are said to be living in relative poverty if their household’s income is less than 60% of the median national income.
Manchester is a target for this Government. They have taken away more Government funding from my city than from anywhere else in the country, whereas in other parts of the country, such as Surrey, they are actually increasing the amount of Government funding. It is a cynical political trick. They know that they cannot win seats in Manchester, so why make life comfortable for people there? By contrast, in Surrey they do have some hope of winning constituencies. It is a political manoeuvre and my constituents suffer because of it.
The Government’s policy can be summed up:
“For whosoever hath, to him shall be given…but whosoever hath not, from him shall be taken away even that he hath.”
Benefit sanctions are spoken of again and again. Heaven knows I have a case load, as the Secretary of State knows from his correspondence with me, but people should not look for benefits other than those to which they are entitled by family circumstances. They should be able to have jobs. In Manchester, we have the Manchester living wage, but it does not prevail. If people do not have incomes or jobs they cannot buy food. It is terrible that we have in this country—a progressive western European country—hunger that is categorised by Unilever and Oxfam. The people who provide food banks are fine, decent people. They are good people—valuable people—but we should not need them.
Mr Speaker
A very large number of colleagues are seeking to catch my eye, as a result of which I have to reduce the time limit on Back-Bench speeches to three minutes with immediate effect.
Sarah Newton (Truro and Falmouth) (Con)
It is a pleasure, Mr Speaker, to follow the right hon. Member for Manchester, Gorton (Sir Gerald Kaufman), who represents the city where my husband grew up. I am familiar with the type of poverty that he described, as my husband grew up in a two-up, two-down council house in a neighbourhood very similar to the one that he represents. Like many Government Members, we are absolutely able to relate to and represent the sort of community that he represents. I am sure we all share the horror and shock at the fact that many people need to go to food banks in the 21st century in one of the wealthiest countries in the world. We are united in our desire to help people out of poverty and help them stand on their own feet to secure a sustainable life.
I find the tenor of this debate unbearably disappointing, after doing so much careful work with colleagues across the House on the all-party parliamentary group. Everyone has said that the work was thoughtful and considered, and it has been much referenced. The key finding of that report was well articulated by the Archbishop of Canterbury: this issue is so great and has been going on for so long that it needs to rise above party politics. It needs a considered, all-party approach, but this debate has thoroughly let down the people in our constituencies who have to go food banks. It thoroughly lets down the hundreds and thousands of volunteers who give their time so freely.
The Opposition had the opportunity to hold a debate granted by the Backbench Business Committee. They did not have to pick an Opposition day to discuss such an issue. I shall leave my hon. Friend the Member for Salisbury (John Glen) to discuss the APPG findings, and in the time available I want to discuss what is going on in my constituency. For well over a year, volunteers from my team have gone to each session in the three food banks in my constituency. I represent one of the poorest regions in the country, so I understand why people use food banks. We are helping those volunteers to get to the underlying reasons why people use food banks and we are helping those people to get back on their feet. That was a key recommendation in the APPG report.
Jeremy Lefroy
Does my hon. Friend agree that a key point about food banks and the important work that they do is that it is not just about the distribution of food? It is about listening to problems and giving advice, pointing people in the right direction, as well as providing food.
Sarah Newton
My hon. Friend is absolutely right. I know that the volunteers at the food bank really welcome the volunteers from my team, who provide such important advice in getting to the underlying reasons why people are there. We can help with issues relating to benefits, employment, housing and debt, among many others, because there is a huge variety of issues. By working with DWP locally and Cornwall council, as well as with employers and civil society, we can help a great many people access the available help so that they can deal with those issues and get themselves back on their own two feet, which is exactly what they want to do. Nobody wants to end up at a food bank, but some people at some time in their lives will need a great deal of help to help themselves. Although the state of course has a role to play, nothing will ever replace the kindness and generosity of somebody freely giving their time to help a person in need.
Stephen Mosley
The volunteers in my constituency, like those in my hon. Friend’s, work really hard at the food bank to support and help people. One thing they raise with me, however, is the fact that from time to time people have nowhere to turn when they have benefit problems. Does her office have people in that situation coming to see her for help?
Sarah Newton
Yes, and I am very pleased that I have such experienced members of my team at the food banks. They have years of experience at the citizens advice bureau and can give that advice and sort out benefit problems with the DWP locally. I have nothing but respect and admiration for the team in my local Jobcentre Plus, who work very well with us when issues are identified, to ensure that people get the support that is there for them. The biggest single issue we find in the work we have been doing for well over a year now is that people do not get, or do not even know about, all the help that is available to them. Having people at food banks who can offer good advice on welfare, debt and employment is absolutely essential. Although I really appreciate and value the opportunity to talk about the excellent work being done in my constituency, I think that the way the Opposition have approached the issue today is shameful.
Luciana Berger (Liverpool, Wavertree) (Lab/Co-op)
I am ashamed and angry that we are having to have this debate today and that just under 1 million people in our country have to access emergency food aid. It is an absolute disgrace. We know that those figures only touch the surface. I heard stories when I was in Erewash—for example about Billy, who has to go “skipping” when the supermarkets put out their food at the end of each day because he has nothing to eat. There are the mums who are going without, the teachers who say they have children turning up at school hungry because they have nothing to eat at home, and the councillors who are handing out food from the back of their cars. The list goes on. The figures we have are just from the Trussell Trust, but we know that there are many more food banks and unofficial organisations that help people in need, whether they be hostels, luncheon clubs or the many other people who provide emergency food aid.
I have said it before, and I will say it again: there is not one person who walks into a food bank with their head held high. People cannot just walk into a food bank because they decide they want a bit of extra food; they have to be referred. As the many hon. Members in this House who issue food bank vouchers know, it is an incredibly difficult thing to broach with a constituent who is clearly in need. I have had constituents reject the offer because they are ashamed and embarrassed. The fact that we have to do that as MPs should fill us all with shame. Frankly, I am appalled that two years on from the debate we had at Christmas 2012, when the Minister said that it was not a problem, the number of people in our country having to access emergency food aid is approaching 1 million. Again, I am frankly appalled.
We know that there are many organisations across the country doing phenomenal work, whether that is the Trussell Trust, FareShare or FoodCycle, which go out of their way to provide people with help. I have seen it in my constituency. I have met a man who had to walk a 9-mile round trip in the cold, having just come out of hospital after heart surgery, because he had nothing to eat at home. I had a constituent who had worked all her life but was made redundant in her mid-50s. She had applied for hundreds of jobs and did not receive the support she was entitled to. My constituent Thomas O’Donnell waited eight months for his personal independence payment and suffered malnutrition as a result. I am sorry that the Minister is too busy to listen to the individual cases of my constituents who have been affected and had to access emergency food aid.
Luciana Berger
I have been asked not to, because other Members wish to speak.
A family in my constituency have been waiting since August to get their tax credit application processed, and they are having to live on food bank vouchers because they have nothing to eat at home. I pay tribute to James Sloan and those at Central Liverpool food bank who do such an excellent job in providing people with support, and the volunteers who give their time to collect food, the people who donate very generously—in Liverpool, we have had one of the most generous supermarket collections anywhere across the country—and the people who give their time to listen and to provide a cup of tea.
However, I reiterate that we should not need those volunteers. We should not need the hundreds of food banks. We should not have 1 million people having to access emergency food aid. It is a disgrace that over 23,000 people—
Mr Speaker
Order. Time is up. Before I call the next speaker, let me say to the House that I know that nobody intends any discourtesy, but it is frankly discourteous for Members on the Treasury Bench to be chattering to each other when an hon. Member is speaking. These are important matters. Please let us treat each other with appropriate respect. I hope that the Minister, who is sitting there impassively, has got the point—he had better have got it.
John Glen (Salisbury) (Con)
It is a privilege to contribute to this debate. I represent Salisbury, where the headquarters of the Trussell Trust are based. I have had the privilege of deep and thoughtful conversations and dialogue with those at the Trussell Trust during my time as MP.
Having contributed extensively to the report over the past six months, I am struck by the range of the 77 recommendations that we have made. The report makes uncomfortable reading for all politicians in all parts of the House. I want to make it absolutely clear that I understand the strong feelings that are generated when we discuss this matter. Let me therefore point out that we focus extensively on the issues of low pay, benefit administration, benefit delays, hardship payments, short-term benefit advances, tax credits, mandatory reconsideration and benefit sanctions. However, it is also important that we think about supermarkets, the food supply chain, energy companies and regulators, and how the food banks operate and work with other charitable organisations. If we are going to take this report seriously, it is very important that we do not try to cherry-pick its recommendations. As Chris Mould, the chairman of the Trussell Trust said,
“that’s precisely how to hollow out the potential and impact of the inquiry and leave most of the causes of the problem untouched.”
I do not want not to reference fully the complexity of individuals who use food banks and the fact that some of the issues they raise make uncomfortable reading for politicians on the Government Benches. However, we have to be honest about what we are saying about an alternative. When we talk about reforming the sanctions system, we are talking about a system where there has been a significant improvement and where, when there were changes to benefits in 2006-07, there was also a spike in the proportion of those who gave benefit delays as a reason for using food banks. In fact, the situation was very similar to the one we saw when the recent benefit changes were implemented. This is a national system, where 18,000 decisions are made every day.
Sarah Newton
Does my hon. Friend agree that, as we saw in the report, a lot of the solutions can be found by talking to local DWP staff and identifying where there could be glitches, so that those staff could themselves be part of the solution?
John Glen
I absolutely agree. Even in Salisbury, where according to today’s figures unemployment is down to 0.8%, we know of individuals who have not been well served by certain decisions. We all act as advocates for those individuals, and it is perfectly right that we should.
As the Bishop of Salisbury said when he gave evidence to the APPG,
“hunger can happen to any of us. It stems from low pay, lack of self-esteem, family breakdown, unemployment, addiction, mental illness, sickness or bad luck”—
or, indeed, a combination of many of those factors. Any strategy on food poverty that ignores that list in its entirety and how those elements interact with one another, choosing instead to focus entirely on benefits and economic factors, does not do justice to the complexity of the problem in this country. Everyone who turns to a food bank has a different story to tell: some are about straightforward administrative errors, whereas others are extensive tales of hardship. I urge the Government, in their response, to reflect on the full range of our 77 recommendations and the issues that we have discussed.
Mr Frank Field (Birkenhead) (Lab)
I want to address one question that arises from the speech made by the hon. Member for Stafford (Jeremy Lefroy). There is a sense of anger and shame that, as politicians, we are all almost powerless in the face of the rising tide of poverty and hunger in our constituencies. I want to caution people who think it will be easy to stem that tide. I want to address those on both Front Benches on what I hope, as we go into the election, the electorate will ask of us in alleviating the current position.
I do not believe, as the hon. Gentleman and some academics have suggested, that we are in a world in which we can easily move to the abolition of food banks. I wish that were true. One important thing that I hope we did in the report was to suggest that the situation exists not only in this country, but in similar economies in the western world. In Canada, the United States, France and Germany, as in this country, the number of people reduced to hunger is increasing. That suggests that something very fundamental has happened and is happening to the economy in such western countries, and that protecting the poor—as far as they are concerned, the economy is clearly falling away—will be really difficult.
That does not mean that we should not think about what we are doing, or that we should not ask both Government and Opposition Front Benchers to lessen the number of our constituents who are faced with the horror of not being able to feed their children or, many times, not being able to feed themselves. The Government have an important role in relation to the number of people who are hungry. A number of rip-off merchants in the utilities who charge the poor more than the very rich are accountable. There is the shame of being in a country in which only 2% of the edible waste is recycled to people who are hungry today.
Mr Field
No, I will not give way, because other Members want to speak.
The important point for Government and Opposition Front Benchers is whether we will implement the recommendation that if someone’s benefit is not paid in a reasonable time, they automatically qualify for emergency payments. Will they both introduce a yellow card system to ensure that those who have been sanctioned can seek help, rather than having to face hunger? It is fine for us to get angry, but we have some power, which is to make the two Front-Bench teams respond to our demands, and I have not heard them talk about that tonight.
Mr Speaker
Order. The Front-Bench speeches will begin at 6.46 pm. There is no obligation on Members to take the full three minutes, and those who take less time will help others.
Andy McDonald (Middlesbrough) (Lab)
My last visit to one of the six Trussell Trust food banks in my constituency left me shocked and horrified. I heard about a single mum—working as a lunch time school supervisor while training to become a classroom assistant—who must, being employed part time, attend jobcentre interviews. On the day her father died, she forgot her appointment. She rang the next day to apologise and explain, but the death of her father was not accepted as a valid reason for missing her appointment. She was sanctioned for one month, and had no choice but to turn to the food bank. I heard about the 14 men sacked with no pay after four weeks’ work when their food-packing employer went bust. The jobcentre told them they could not claim, but had to pursue the company for their wages. Being penniless, they turned to the food bank.
These stories and thousands like them typify the impact of this Government’s welfare reforms, which, through a cocktail of callousness and ministerial incompetence, are condemning hundreds of thousands of our fellow citizens to modern-day penury. These people are doing all that we ask of them: they are in work or training, and they are trying their hardest under difficult circumstances to better themselves and provide for their families. They are exactly the type of people that our welfare system was created to support, but this Government are punishing them, and leaving them destitute and reliant on charity to stop them and their children going hungry.
Ministers refuse even to acknowledge the explosion in the use of food banks. The Secretary of State boasts that we have fewer people using food banks than in Germany, but having 1 million people having to depend on hand-outs to prevent them from going hungry—870,000 more than when the Government came to office—is nothing to be proud of.
The reasons that the Government have given for the rise in the number of food banks have ranged from the ignorant to the outright scurrilous. There is not the time to recite all the dreadful things that Ministers have said, but now infamous ones have included sentiments from “Let them eat porridge” to “People use food banks because more people know they’re there”, or, “There’s more food waste being recycled”. It is either that or “The lower orders simply can’t cook”. There is no limit to how offensive Ministers can be. Condescending and out of touch does not begin to describe it.
What our country needs is a lower cost of living, higher wages and a fair benefits system that is fit for purpose. We must end the scandal of in-work poverty by raising the minimum wage, spreading the living wage, keeping household bills down and putting an end to exploitative employment practices. The Government would have it that poverty is the personal and moral failure of the poor, to which there is an all-stick-and-no-carrot solution of plunging the poor further into destitution.
We have to ask what type of society we want to be. Having witnessed the tremendous kindness and generosity of ordinary people who donate to and run food banks, I do not think the British people believe that those who have fallen on hard times through no fault of their own should be thrown on to the scrap heap as the Government are doing. Any future Government ought to count achieving a hunger-free UK as a priority, but for that Government this nation’s hungry will sadly have to wait.
Mr Mike Weir (Angus) (SNP)
Everybody should agree that it is an absolute and utter disgrace, in a rich, developed nation of the 21st century, that so many of our fellow citizens have to resort to food banks. The largest food bank in my constituency is the Angus food bank, which is run by a group of churches, supported by the Trussell Trust. I have joined food collections, and the dedication of volunteers and the generosity of those who donate never ceases to amaze me.
It is often those who have little enough themselves who are most ready to help their fellow citizens. I recall that at a recent event, one person came up to us with a small donation, saying that he could not afford much but had been helped by the food bank when he was in need and wanted to give something back. That is far from unusual. Food banks bring out the best in ordinary people with a desire to help those who find themselves in temporary difficulties through illness, unemployment or other factors. Unfortunately, they do not seem to have that effect on Ministers.
The rise in food bank use is down to rising need, and the number of people using them is certainly going up. In Scotland alone, 51,647 people received a minimum three-day supply of food from a Trussell Trust food bank in the six months to September this year, an increase of an astonishing 124% on the same period last year. Almost one third of those helped were children. The Trussell Trust expects that over the full year, the number will rise to more than 90,000. Angus food bank helped 1,247 people in the six months to April, and it does not cover the major town of Arbroath, which is served by other food banks. Some 277 of those people were children. In the council ward where I live, 338 people were helped. Those figures are shocking.
Why do people go to food banks? The Trussell Trust says that only 5% of people who come to it cite homelessness as the main cause of their crisis. Almost half—46%—cite benefit problems, and a further 18% cite low income.
Jim Shannon
(Strangford) (DUP): The Trussell Trust food bank in Newtonards, in my constituency, was the first in Northern Ireland. It is run by the Thriving Life church and does excellent work. I am the main referral agency for it, and for the record, the main reasons for referrals are benefit delays at 30%, benefit changes at 15% and low income at 22%. Last year—
Mr Deputy Speaker (Mr Lindsay Hoyle)
Order. Interventions need to be short. We are trying to get everybody in, and it is not going to happen at this rate.
Mr Weir
Clearly the main issues are a direct result of the current Government’s policies. Many people turning to food banks have been “sanctioned”, to use the Government’s word, often for seemingly unfair reasons. Some 86% of food banks say that they have seen an increase in referrals for that reason. It is not just the Trussell Trust making that point; Barnardo’s also does, citing the rising cost of living, cuts in welfare support and benefit delays.
Those matters are under the Government’s control. There do not need to be delays in sorting out benefits when circumstances change or for there to be sanctions for seemingly minor reasons. From my constituency experience, there appears to be a particular problem when someone wishes to change from a dual to a single claim. They cannot get a clear answer on what information is required to prove their status. Such cases can drag on for months, which is completely and utterly unacceptable. Sorting that out would not necessarily increase costs and would certainly reduce the misery that many of those who use food banks are suffering.
The use of food banks is not just about benefits. It is also about incomes, as many Members have said. The Scottish Government are promoting the living wage among their own employers, and the new ScotRail contract will include a living wage clause. SSE has just become a living wage employer. Food banks are not an easy route for anyone, and those who will be most pleased when food banks cease to be required are the volunteers who are putting so much into running them and helping those in need.
Grahame M. Morris (Easington) (Lab)
Like many Members, I will start by thanking those in my constituency and across east Durham without whose donations, care, compassion and commitment, local food banks would not function. I thank volunteers who work with the East Durham Trust’s FEED project, and the County Durham food bank for its hard work and dedication throughout the year, and the support that it has offered my constituents in times of great crisis. However, although I am delighted and honoured to pay tribute to those volunteers and everyone who supports food banks, we must address the political question of why there has been such an exponential growth in their use. Government Ministers suggesting that it is some kind of act of God simply does not wash.
In my opinion, the acceptable level of food bank usage is zero. Access to adequate nutrition is a basic human right, and there is no excuse, even in a time of austerity, for a modern and rich country—I think we are the seventh richest country—to be unable to meet the food needs of its people. The Prime Minister said that food bank usage increased from 2005-06, but numbers went from 40,000 to almost 900,000 this year—those are huge numbers.
Information that I receive from food banks in my constituency shows that there is little evidence, if any, of people abusing the system. The average number of visits from an individual user is 1.7, with the food bank often being instrumental in resolving a particular crisis and the underlying cause that led to initial contact with the food bank. In fact, food banks are more concerned about those in Easington and east Durham who are too proud to access the service, and it is often only the intervention of a referral agent—a health visitor, social worker, or sometimes an MP—that brings many cases to the attention of the food bank.
I do not have time to go into the figures, but the numbers are staggering and we have not seen anything like it since the miners’ strike in terms of the numbers of families and children who are being fed not just by the Peterlee and Seaham based centres, but by centres in smaller villages. Something like 1,300 people use such centres every month, a third of whom are children, and one food bank produces 12,000 meals a month. Clearly, benefit delays or referrals are the commonest reason why people are using those food banks.
Stephen Doughty (Cardiff South and Penarth) (Lab/Co-op)
The hon. Member for Truro and Falmouth (Sarah Newton), who is no longer in her place, spoke of being disappointed with aspects of this debate. Well, I was disappointed that the Minister came to the Dispatch Box with a folder full of facts and statistics on the economy, food waste, the performance of the Department for Work and Pensions, and many other issues, yet he could not bring himself to admit why people are going to food banks in this country. For the benefit of the House, I will add some examples that I have heard, which back up what the Trussell Trust, independent food banks and many others are saying: the use of food banks is caused by changes and delays in the benefit system, debt, and, increasingly, people with low incomes who made up 22% of cases this year, up from 16% the year before. Those are the facts, and it is a shame that the Minister—unlike some Government Members who were far more candid and open—was unable to state them. Perhaps the Minister who winds up the debate will be clearer.
I pay tribute to the many volunteers and organisations in my constituency, including Cardiff food bank, which is part of the Trussell Trust network and fed more than 4,500 people in the past year. The independent food bank at Tabernacle Baptist church in Penarth fed an increasing number of people this year—2,180 to date, and that number is increasing all the time. It repeats to me the same reasons for why people come to it.
I pay tribute to those volunteers, many of whom come to me and ask, “Why?” That is the fundamental question that the Government have failed to answer today. From my experience in international development, the same question is asked about poverty and injustice around the world. We see people who are facing disaster and we ask why they are vulnerable to disaster. It is because they are living in poverty. Why are they living in poverty? It is often of the systems, policies and processes of Governments and others that leave them in that place in the first place. One member of staff I worked with at the charity World Vision once spoke to me about a pit in the world of poverty, with a big digger digging it out. Organisations such as food banks can put rocks back into the pit to try to fill it back up. Ultimately, however, they cannot stop the digger digging it out. The digger in this case are the Government, with policies such as the bedroom tax and punitive sanctions, and policies that fail to deal with energy prices and the cost of living. That is the digger and that is what we have to switch off. The Government would do well to listen, rather than trying to undermine the organisations that are speaking up for so many across the country.
Nia Griffith (Llanelli) (Lab)
I pay tribute to the excellent work of the Antioch centre and Myrtle house in my constituency, and to those who volunteer to collect food from supermarkets.
It saddens me that, in spite of us raising this problem many times before, the Government still have not done anything about it. Instead of seeing a drop, we are actually seeing a rise, documented by others today, in the number of people going to food banks. I was particularly disappointed that the Minister did not seek to tackle or name the causes of that rise. He did not talk about benefit delays, low income or benefit changes.
It is a mark of indignity to have to go to a food bank. Nobody goes to one out of choice, and we should be trying to restore dignity. Believe me, people on the lowest incomes know where to find the cheapest food. Baroness Jenkin, who criticised cooking skills, has absolutely no idea. Very often, the people who live in the worst rented accommodation have the most expensive and least efficient cooking appliances and pay the most for their electricity.
On benefit sanctions, the right-wing Policy Exchange think-tank acknowledged in a report in the spring that 68,000 benefit claimants each year are having their benefit payments stopped unfairly. In addition, there are a huge number of very dubious cases where it has been very unclear why a benefit has been stopped. People have been sanctioned for appalling reasons: death, being in hospital, and having learning difficulties and not understanding what they are supposed to be doing. That is absolutely outrageous.
Barnardo’s highlights the real issue: the breaking of the link between benefits and inflation. In the House of Commons Library note, the specialist tells us that that has never, ever happened before under any Government, whatever their colour. The link has never been broken. There is, therefore, a political choice: to sort out the country’s deficit problems on the backs of the rich and not take from the poor; or to do so on the backs of the poor and give tax breaks to millionaires.
Stephen Timms (East Ham) (Lab)
“Hunger stalks the land.” That is the conclusion of the all-party parliamentary inquiry into hunger in the UK. I welcome that inquiry. Thanks to the members of that inquiry and the report they have produced, the truth, so long denied by Ministers, must now be faced: a lot of people in Britain are going hungry.
I want to add my tribute to the volunteers responding to hunger. We have heard a good deal about the Trussell Trust. It has 400 food banks operating from 1,200 locations, every single one of them based on a church. Last month, the report it was responsible for, with others—referred to by my hon. Friend the Member for Garston and Halewood (Maria Eagle) in her excellent speech and launched at the meeting chaired by the hon. Member for Stafford (Jeremy Lefroy)—set out the facts. The interviews with almost 1,000 users in three food banks showed that well over half were there because of problems with the benefit system. The bulk of the problem is in the DWP. The all-party inquiry confirms that, yet no DWP Minister is going to defend the woeful record of the Department in this debate.
A newspaper article on 22 December last year told us that the chairman of the Trussell Trust repeatedly asked the Secretary State last year to meet to discuss the problems in the DWP that were driving people to food banks. The Secretary of State did not meet the Trussell Trust. Last week in the House he told us:
“I have never refused to meet it”.—[Official Report, 8 December 2014; Vol. 589, c. 638.]
I hope he will at some point explain to us what the distinction is between not agreeing to meet and refusing to meet, because he did not meet the trust. The article tells us not only that the Secretary of State did not meet the Trussell Trust, but that in his reply to the letter he accused the Trussell Trust of publicity seeking.
What gets under the skin of the Secretary of State, whom I am delighted to see in his place, is that the Trussell Trust refuses to shut up about how many people are turning up to its food banks. He was simply unwilling to face up to the consequences for the hundreds of thousands of people forced by his policies to go hungry. Thanks to no less an authority than the National Audit Office and its report on universal credit, we know that he has established a good news culture in his Department: telling the truth about the effects of his policies is simply not allowed.
Having failed to get a meeting with the Secretary of State, the Trussell Trust wrote to the welfare reform Minister, Lord Freud, who wrote back on 30 August saying he was
“unable to take up your offer of a meeting”.
Ministers did not want to know what was really going on. Last week, faced at last with the truth from the all-party inquiry—heaven knows what pressure the Secretary of State put on his hon. Friends who signed up to the inquiry—the Secretary of State made a concession. He said he would do much more to raise awareness of interim payments—at last! Let us hope he delivers, but that was exactly what the Trussell Trust wanted to speak to him about well over a year ago, when he refused to engage.
The Secretary of State for Work and Pensions (Mr Iain Duncan Smith)
I have made it clear that I have met members of the Trussell Trust. I have never denied meeting members. The right hon. Gentleman needs to reveal his sources.
Stephen Timms
The chairman of the Trussell Trust wrote to him repeatedly last year asking to meet him, but he did not meet him.
Stephen Timms
We have all met members of the Trussell Trust. The Secretary of State refused to meet the chairman. [Interruption.] Ah, I think we are getting somewhere. He tells us that members of his staff met—
Stephen Timms
And him, too. Why did he not meet the chairman of the Trussell Trust, who wanted to explain—
Mr Deputy Speaker (Mr Lindsay Hoyle)
Order. We need to keep the debate going. We cannot have people talking across each other.
Stephen Timms
The Secretary of State refused to meet the chairman of the Trussell Trust, because he wanted to explain to him the problems that the policies of his Department were causing for the hundreds of thousands of people having to go to food banks as a result.
As we now know, the big reason so many people are going to food banks is delays in benefit payments. Whenever that is raised, Ministers say that delays in benefit payments have fallen. The all-party inquiry has shed some welcome light on the matter. It wrote:
“We found that the Department for Work and Pensions does not currently collect information on the length of time taken for benefit payments to be made.”
It is not surprising they do not know what is going on, because they do not collect the information. The big problem is with sanctions, as we have heard: between 19% and 28% of food bank visits are the result of benefit sanctions. As Government Members have confirmed, including the hon. Member for Birmingham, Yardley (John Hemming), enormous pressure is being placed on advisers to sanction people, whether or not those sanctions are justified.
We have all-party recognition that hunger is stalking the land. The all-party inquiry is right. We need a strategy to end hunger, and a big part of that will involve putting right the terrible problems in the DWP, but with DWP Ministers not even willing to take part in this debate, it will take a change of Government to do it.
The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (George Eustice)
It is a pleasure to have the opportunity to close this debate.
I begin by reiterating what many other hon. Members, including the Minister for Civil Society, have said about the fantastic work food banks do and the role they play in our voluntary sector. This Friday, I will again be visiting a food bank in my constituency, run by Don Gardner, who is involved in the local church, and by many other able volunteers and church groups in the area. I also pay tribute to hon. Members who took part in the recent all-party group inquiry into hunger and food poverty. We have heard some good contributions from my hon. Friends the Members for Salisbury (John Glen) and for Truro and Falmouth (Sarah Newton) and the right hon. Member for Birkenhead (Mr Field).
The report concludes that the issues surrounding household food security are varied and complex and should be considered as a whole. Indeed, earlier this year DEFRA published a review of food aid that reached a similar conclusion. We should also note that food aid is not just a UK phenomenon. Other countries have also seen a large increase in the provision of support through food banks. In Germany, for example, food banks support about 1.5 million people every week. There has also been a large increase in the number of food banks in countries such as France and the United States.
The reasons are complex and every report that has considered the issue has concluded that much. Some have said, for instance, that food price inflation might be a factor. There was certainly a big spike in food prices in 2008, but evidence shows that in 2013 food prices in the UK were lower than those in other European countries, including Germany. UK food prices are lower now than they were in 2013. In fact, in the last year UK food prices have fallen by 1.7%, the first time we have seen such a fall since 2002.
A number of people have suggested that the inflation that happened between 2008 and 2012 might have had a compound impact on household incomes and expenditure, and that is possible, but we should recognise that in 2008 the poorest 20% of households in this country were spending 16.8% of household income on food whereas in 2012 that figure was 16.6%. The amount spent by the poorest households on food barely changed between 2007 and 2012. We recognise that there are those who are struggling to cope with the cost of food, which is why the Government are doing a number of things to help. For instance, we have extended free school meals to all infant pupils, which means that an extra 1.5 million children are receiving a nutritious meal.
Let me turn now to some of the other points that were made. A number of hon. Members mentioned sanctions and delays in payment, but the fact of the matter is that 93% of JSA and ESA claimants get their payments on time—
George Eustice
No, I will not. We have no time.
That figure can be compared with 86% in 2009-10, so there has been an improvement in payment times.
A number of hon. Members have mentioned sanctions. I have discussed the issue with my own local jobcentre and I can confirm that hardship payments are being paid where needed. The right hon. Member for Birkenhead raised the important question of whether there is more we can do to advertise hardship payments. I can confirm that the Government are looking at ways in which we can advertise them more. My own jobcentre has already made it clear that whenever it sanctions anyone it also explains to them the availability of hardship payments, which is important. I should also say that there are no benchmarks or targets for sanction referrals. We have also tried to speed up the payment of hardship payments to within three days of when people are entitled to them.
I want to turn to a number of other relevant issues. First, is poverty a driver to the use of food banks? It might well be—obviously it is—but the best way to get people out of poverty is to help them off benefits and into work. Since 2010 we have 1.7 million more people in work, which means 1.7 million more people with the security of a pay packet. The latest statistics show that 95% of the jobs being created are full-time jobs.
Let me turn now to food waste, food recycling and redistribution. Much has been done through provisions such as the Courtauld commitment. For instance, we have cut household waste by about 15%, a saving of 1.1 million tonnes of waste, but the Government are committed to doing far more about the redistribution of food. That is why my right hon. Friend the Secretary of State for Environment, Food and Rural Affairs and my hon. Friend the Minister for Civil Society will convene a meeting in the new year with leaders of the major food retailers and other industry representatives to discuss how more surplus food can be put to good use.
In conclusion—
Ms Rosie Winterton (Doncaster Central) (Lab)
claimed to move the closure (Standing Order No. 36).
Question put forthwith, That the Question be now put.
Question agreed to.
Main Question accordingly put.
Warwick (1,100th Anniversary)
Chris White (Warwick and Leamington) (Con)
It is an honour to represent the constituency of Warwick and Leamington, particularly in this anniversary year. The constituency includes the towns of Leamington, Whitnash and Warwick and a number of surrounding villages, but in this debate I wish to celebrate the 1100th anniversary of the founding of Warwick, a town steeped in history and characterised by a strong community spirit.
Many of the iconic buildings that make up part of this history are still standing today, and are integral to the fabric of the community. The transition from a defensive stronghold in 914 to the impressive county town of Warwickshire in 2014 is clear for all to see; Warwick has developed over many centuries and is now a remarkable place to live and a popular tourist destination. I would like to put on the record details of its long and illustrious history, and reflect on the characteristics that shape our town today.
Historic buildings are a defining aspect of Warwick, including St. Mary’s collegiate church, dating back to 1123, and the Chantry chapel at the Lord Leycester hospital, dating back to 1126. Alongside this historical grounding and rich heritage, Warwick is home today to a range of fantastic schools, voluntary organisations and businesses, all supported by local residents with a dedicated, hard-working and neighbourly nature. It also stages nationally-renowned festivals, from the ever-popular folk festival, now in its 35th year, to the annual Victorian evening which starts the festive season in a spectacularly traditional way.
Our open green spaces remain a picturesque part of Warwick—not least St Nicholas park, alongside the river Avon. As a Warwick resident, I hope to see our open spaces preserved and the beauty of the town maintained. Given the nature of Warwick, excessive development would not be in our best interests and I have campaigned against it.
It is widely accepted that the founding of Warwick came in the year 914, when Ethelfleda, Lady of the Mercians, established the settlement—a lady whose face has appeared on many mugs, tea-towels and other merchandising this year. The town was built on a small hill that controlled the river crossing on the road to London, and was strategically placed to control the Fosse way, built by the Romans. It was therefore an excellent location to protect locals from the threat of invasion. According to the etching from 1731 in my office
“the town has a pleasant situation on the North side of the River Avon upon a hill”.
However, the etching also suggests that there were settlements on this land prior to 914, and that Kimboline, a British King, established a town there around Christ’s nativity.
The fortified dwelling was one of 10 built to defend Mercia from the threat of the Danes, and the settlement became the county town of the new shire of Warwickshire in 1001. In 1068, William the Conqueror built a motte and bailey castle to gain control of the region and to respond to various uprisings. The famous castle is still an integral part of Warwick, providing a majestic backdrop and attracting vast numbers of visitors every year.
In 1086, 244 dwellings were recorded in the Domesday Book as the settlement started to grow. The fortification of the town was completed with the construction of a town wall. A market was based in a number of streets and buildings across Warwick. Because of its location away from the main trading routes, there was significant competition from nearby towns for trade. The main prosperity came from the castle, but trading was certainly a major feature, and the market remains a part of weekly life in our town today—come rain or shine, traders still operate in the square every Saturday.
The square also has the statue of Randolph Turpin, the boxing champion who won the world middleweight title in 1951. He was considered to be one of the best in the sport throughout the 1940s and 1950s. Wandering through the square and around the centre of Warwick, we find a huge array of pubs and restaurants and a fabulous night scene.
By the 15th century, many of the suburbs we see today were formed, including Saltisford and Smith Street. By the early 17th century the general street pattern was clear, and the town was being shaped as a tight community that continues today.
Mr Jim Cunningham (Coventry South) (Lab)
I congratulate the hon. Gentleman on securing the Adjournment debate. His constituency is right next to mine, although mine is in Coventry and at one time Coventry was part of Warwick. Will he join me in congratulating Warwick university, which is partly in Coventry and partly in Warwickshire, as next year will be the 50th anniversary of its foundation? I know he takes a great interest in that.
Chris White
I am grateful for the hon. Gentleman’s contribution. We work closely together to celebrate the contribution that the university makes. It was good to join him in marking that anniversary a couple of weeks ago. I hope Coventry and Warwick can work together to make sure that the university continues to flourish.
In 1552, the court leet was established by a royal charter, and is still in existence. The group of jurors represent the best interests of the borough, and includes interesting positions such as constables, overseers of pavements, an ale taster and a brook looker. This hat-tip to history is representative of what Warwick is about. I pay tribute to the current mayor of Warwick, Councillor Moira-Anne Grainger, who helps to continue the fine tradition of civic leadership and pride.
As the county town, Warwick attracted many visitors. The market remained a feature, and the town became a popular destination. Horse racing was becoming a crowd-pleasing form of entertainment in the 17th century, and with the financial help of Lord Brook, the first race took place on St Mary’s common in 1707. The racecourse remains a distinct part of the town, holding regular meetings, and is nationally recognised. Entertainment was provided for all tastes as the town grew, and a theatre was built in the 1790s.
During the civil wars of the 17th century, Sir Robert Greville sided with the parliamentarians and put the castle in a state of readiness, yet Warwick managed to remain unscathed. However, the town’s luck came to an end on the afternoon of 5 September 1694. The great fire, which almost destroyed the town, spread swiftly across much of Warwick, destroying or damaging about 250 shops and houses owing to their timber frames and close proximity. The impact that this had on the town was far reaching, requiring financial support to rebuild the affected buildings. Plans were put in place by the owner of Warwick castle, together with local gentry. Most of the rebuilding was completed within a few years, and the designs were subject to an Act of Parliament. This discouraged alterations to the town for a number of years, but in the 18th century the design of Warwick became more creative.
The court house was built in the 1720s and the shire hall was replaced in 1758. Although the current shire hall is one of the most shocking pieces of architecture in the town, it houses the county council. I hope that in 2015 we can start the process of consultation as to the merits of a unitary authority. I would like to praise Warwick town council for reopening the beautiful building that is the court house on Jury street, with the financial assistance of the Heritage Lottery Fund. The grade 1 listed building has this year become a place for community events, and it is wonderful to see it being utilised in this way. The court house holds fond but anxious memories for me personally, as it was at a meeting there in 2002 that I was selected to stand as the candidate for the Warwick and Leamington seat.
I should like to add a little more detail on the castle, which is undoubtedly one of the most striking features of the town. William I began its construction in 1068 and it still stands today as a landmark, attracting hundreds of thousands of visitors each year. Passing through generations of families, the castle provided protection for nearly 200 years, and was converted into a stone structure in 1260. Four years later, Simon de Montfort successfully attacked the stronghold as leader of the rebellious barons. Caesar’s tower and the dungeons were built in 1350, and Guy’s tower was completed in 1395. A number of our monarchs have visited the castle over the centuries, including Queen Elizabeth I, King William III and Queen Victoria. The castle was attacked in 1264, besieged in 1642 and damaged by fire in 1871, but it has stood the test of time.
St Mary’s church also dominated Warwick in its early days and is an important part of the town today. It was established in 1123 by Roger de Beaumont, the second Earl of Warwick. The only surviving part that de Beaumont built is the crypt, with the chancel vestries and chapter house being extensively rebuilt in the 14th century by a later Earl of Warwick. The church, along with much of Warwick, was significantly affected by the great fire. The nave and tower were completely destroyed, and the church as we know it today was rebuilt in the early 18th century by the brothers Francis and William Smith.
There is much to see in St Mary’s church, including the chapel of the Warwickshire Regiment, several monuments to Warwick dignitaries, and the Beauchamp chapel. In this stunning chapel is the tomb of its builder, Richard Beauchamp, the 13th Earl of Warwick. Beauchamp served Henry IV, Henry V and Henry VI and was a great landowner of the time. His daughter married Richard Neville, who was known as Warwick the Kingmaker, due to wielding the balance of power through the weakness of kings during the first half of the wars of the roses. I am pleased to be a member of the congregation, and I pay tribute to the rector, Vaughan Roberts, who has for many years led services at St Mary’s. I also thank the choir and the organist, who put on a wonderful performance at the carol service on Sunday.
Each year at St Mary’s, the feast of Thomas Oken is celebrated. Oken made a considerable fortune, and left most of it to fund education and housing in the town. His attitude to helping those in need is reflected in his will, which distributed funds to the town. A deeply religious man, Oken put the town and fellow residents first, and provided £1 annually for a feast. His house has been converted into Oken’s tea rooms in Warwick, located near the castle, and his name lives on in Warwick folklore.
The Lord Leycester hospital, an historic group of timber-framed buildings dating back to the late 14th century, is another eye-catching part of the centre of the town, and has a beautiful 12th century chapel attached to it. The word “hospital” is used in its ancient sense, meaning a charitable institution for the housing and maintenance of the needy, infirm or aged. For nearly 200 years, it was the home of Warwick’s medieval guilds. In the reign of Queen Elizabeth I, it became a place of retirement for old warriors, and it remains today as an independent charity providing a home for ex-servicemen and their partners. The man in charge of the hospital is still referred to as “Master” throughout the town.
A little further out of town, Guys Cliffe is a large manor house that is now sadly run down, but it provides a fascinating story about the famous Guy of Warwick. The legend goes that Guy, the son of a castle steward, won the heart of Lady Felice, daughter of the Earl of Warwick. Owing to their different roles, it was unacceptable for the romance to flourish, so Guy went away to fight as a knight to prove his worth. On returning to Warwick, he married Lady Felice but regretted his violent past and embarked on a pilgrimage. On returning once more, he settled in a cave at Guy’s Cliffe, overlooking the Avon, living the rest of his life as a hermit.
Another institution with its roots in history is Warwick school, the oldest boys’ school in the country. The school was certainly in operation during Edward the Confessor’s reign in the 11th century, and there is a statue of him in the entrance hall, but it was probably in existence around the time of the founding of the town itself. The school was situated in the market place, before Henry VIII re-founded it as the King’s New School of Warwick. At that point, the school moved to what is now the Lord Leycester hospital, having being situated in a number of locations. His Royal Highness the Prince of Wales visited this year to congratulate the school on its anniversary. Fittingly, the under-15 rugby team became national champions this year, while the under-18s reached the final at Twickenham.
Schools across the town have much to pride themselves on. I have had the opportunity to meet many groups of students across the area over the years, and the energy, passion, maturity and attitude to hard work are clear to see in all our younger people. As a patron of Myton school, I find that it is always a highlight to visit and to welcome students to Parliament each year, and it will be a great honour to present awards at the school’s ceremony tomorrow evening. Tomorrow morning, I shall be visiting Aylesford school to join the official turf cutting ceremony on the playing fields, marking the start of the new Aylesford primary school build, which is due for completion and to open for its first reception intake in September 2015.
Warwick hospital is also an excellent example of an outstanding local institution, and recent figures in the 2014 Quality Health survey illustrate that 93% of A and E patients that responded felt they were treated with respect and dignity. The dedication and commitment of those who work in the hospital are phenomenal, and only on Monday I had the chance to visit the hospital to see the beginning of the construction of a new ward, which will yet further increase their capacity. Myton hospice also provides an incredible quality of care and is the pride of many in the district. I hear many moving stories about its work, and have had the pleasure of meeting many of the staff and volunteers who are involved.
Community projects generally are a real feature of Warwick. As its Member of Parliament, I have had the opportunity to become involved with a number of fantastic initiatives. The Friends of Warwick Station is an excellent example, aiming to improve the facilities and aesthetics of our railway station. Recently, children from a number of schools across the area joined the group for a flower-planting session, typifying our community spirit. I pay tribute to our local papers, the Warwick Courier and the Warwick Observer, for raising awareness of such initiatives.
On the political aspect of Warwick, the town is first known to have returned members to Parliament in 1275. The parliamentary seat of Warwick and Leamington that I represent was formed in 1885, bringing to an end the election of two Members in each parliamentary Session. Among other predecessors was Sir Anthony Eden who represented the constituency between 1923 and 1957, which gave it its nickname ‘The Garden of Eden’. In his first election victory, Frances Evelyn Greville, the Countess of Warwick, stood against Eden as the Labour candidate. Daisy, as she was known, had joined the Social Democratic Federation in 1904, donating large amounts of money, and supported the great October socialist revolution in Russia.
The rich history of Warwick and the heritage that is stamped on the town can be reflected on with much pride. Industrially, our area is well known for its manufacturing expertise, and the recent growth of the sector is a welcome return to our roots. Our local performance in business is a credit to the array of qualities that the town possesses. Firms operating in more established sectors are also excelling, such as the National Grid Company, and DCA Design International, a world-leading product design consultancy. As many Members will be aware, we recently celebrated small business Saturday, and I have long been an advocate of promoting the value that small firms bring to our economy. I was delighted to walk around the town to visit many of the businesses that are behind the recent resurgence of our local economy, and even managed to purchase my Christmas turkey!
In the 2015 UK vitality index, promoted this week, for local economies by Lambert Smith Hampton, Warwick is fifth overall. In addition, our town ranks equal first for education in the index. Mr Deputy Speaker, if you would indulge me briefly, let me say that jobs figures released today show that in my constituency there has been a 73% fall in the number of unemployed claimants since 2010. That is a remarkable decrease, and I pay tribute to the businesses that have been instrumental in strengthening our local economy.
As I have alluded to, the architecture and aesthetics of the buildings in Warwick are well known, with areas of special historical interest. Wandering through the town and the streets that were set out centuries ago is a reminder of our extensive history. J. R. R. Tolkien married in Warwick in 1916 and was an admirer of our town, with some people suggesting that his stories and writings were based on it. As reported in “Warwick: A Short History & Guide”, Tolkien
“found Warwick, its trees, its hill, and its castle, to be a place of remarkable beauty”.
Since the establishment of Warwick in 914, the town has developed across centuries with a continuous sense of strong attachment for local residents. Next year, we will celebrate the 800th anniversary of Magna Carta and 750 years since the Simon de Montfort Parliament, both important in developing democracy, and it is incredible to think that the town I represent predates that.
The castle has always been an iconic and picturesque feature, and St Mary’s church has always stood tall on the skyline. The market square is a great focal point of the town, and is often a hive of activity, as it has been for centuries. Only last week, I was sitting in the square watching the film “Frozen”, thanks to Warwick Rocks—one of many events that local organisers have done so well to put on for residents.
Today, we have an excellent hospital, successful schools, thriving local businesses, and a wonderful community spirit. Warwick may have come a long way since its establishment in 914, but there is a sense of continuity with our predecessors, which makes it a truly special town.
Mr Deputy Speaker, may I take this opportunity to wish you a happy Christmas? To the Minister, a happy Christmas, but also to the residents of our fine town, a very happy Christmas indeed.
The Minister for Culture and the Digital Economy (Mr Edward Vaizey)
May I add to the great Christmas wishes “Happy Chanukah”? I was privileged to go to the Speaker’s apartments this afternoon to celebrate Chanukah. I heard the Chief Rabbi refer to the Speaker as a mensch, which I think should be the new parliamentary term that we adopt to praise our wonderful Speaker.
I thank my hon. Friend the Member for Warwick and Leamington (Chris White) for his wonderful speech, and for allowing me a small walk-on part in this Adjournment debate. It is not often that we get to deliver our maiden speech twice, so I praise him for doing so. I missed a trick with the 850th anniversary of Wallingford in my town, which is a stripling adolescent compared with Warwick, but after hearing his brilliant speech I intend to stick around for its 900th anniversary, when I will be 87. I serve notice on my constituents that I have another 40 years to serve to echo the celebration that my hon. Friend has held this evening.
It is quite right that my hon. Friend gave an important and lengthy speech, because such a moment only comes around every 1,100 years. After all, the next time we celebrate a similar anniversary it will be 3014 or, if we want to be a bit premature, 2914 for the 2000th anniversary. I know my hon. Friend as the Member for Leamington, which is not, I hasten to add, before anyone gets the wrong end of this stick, to disparage his loyalty to Warwick. It is important to remember that he represents Leamington because, as the Minister responsible for the video games industry, I was privileged to make a visit with him and see the extraordinary companies based in that part of his constituency. It echoes to a certain extent the remarks he made at the end of his speech about the fact that we are lucky to have cities and towns such as Warwick that have an extraordinary heritage spanning hundreds of years but which, at the same time, can adapt and accommodate the modern economy.
Yet again, I am afraid, my hon. Friend outbid me, because not only is Wallingford a pathetic adolescent—not a pathetic adolescent; just an adolescent—compared with Warwick, but his unemployment figures are slightly better than mine. His have fallen by 73%, and mine have fallen only by about 67%, but they are still very good figures indeed.
I note the presence of the hon. Member for Coventry South (Mr Cunningham), with whom I have shared many conversations. Indeed, a couple of years ago he and I visited the mediaeval Charterhouse in his constituency, which he has worked so hard to help restore, and I will continue to work with him on that. At one point he was so taken with my hon. Friend’s speech that he crossed the Floor to have a word with me. I thought that he might stay with us, so blown away was he by the rhetoric.
The people of Warwick have not been backward in coming forward to celebrate this important anniversary. There have been the brilliant St George’s day celebrations, the walking tours that explain the history of the town and the beer festival at Warwick race course, which included—I cannot remember whether my hon. Friend mentioned it—a celebratory beer brewed locally and specially for the occasion. I think that huge commitment to the anniversary is to be commended.
I was delighted to hear that the Prince of Wales visited Warwick to recognise the importance of the anniversary. I pay tribute to the extraordinary work he has done over so many years to support not only our heritage, but our modern economy. I was with him yesterday at the science museum, where we were celebrating engineering, and particularly the role of women in engineering.
My hon. Friend pointed to numerous ornaments in Warwick, and of course Warwick castle stands out as one of the greatest. One does not actually have to visit Warwick to appreciate the castle, because a little-known fact is that it is the building in this country that is most represented by the great Venetian painter Canaletto—there are five paintings and three drawings extant—who was commissioned by its owners. If you cannot visit the castle, Mr Deputy Speaker, I urge you to have a look at those pictures.
My hon. Friend also mentioned Warwick school, which is indeed the oldest public school in the country. I hope that it continues to have a thriving future, despite the plans of the hon. Member for Stoke-on-Trent Central (Tristram Hunt) in his war with our great public schools. The school is also noted for educating two Conservative MPs: my hon. Friend the Member for North Warwickshire (Dan Byles) and the famous Harry Greenway, the former Member for Ealing North, who I think was known to you, Mr Deputy Speaker. The current permanent secretary at the Department of Energy and Climate Chance, Mr Stephen Lovegrove, also attended Warwick school, as did Christian Horner, the head of Red Bull racing, but better known as the fiancé of Geri Halliwell. She will be known to you, Mr Deputy Speaker, as Ginger Spice—I know that you stopped engaging in popular culture about 20 years ago. Of course—this is more in tune with your cultural tastes—Sabine Baring-Gould, the author of “Onward, Christian Soldiers”, attended Warwick school in the mid-19th century.
Warwick’s rich historic wealth is demonstrated by the number of designated assets within its borders. There are just under 1,500 listed buildings, 30 of which are grade I, 40 are scheduled monuments, 11 are parks and gardens and 31 are conservation areas.
If I was to make a policy point, I would say that my hon. Friend has demonstrated the importance of anniversaries. When we talk in this country about community cohesion and identity, we should remember anniversaries. When we worked with the heritage lottery fund, for example, I was pleased to be able to set aside a ring-fenced fund of £10 million that could be awarded for anniversaries. I hope that some of the money will support the important anniversary of the battle of Waterloo next year and the very important anniversary of Magna Carta, to which my hon. Friend alluded. Of course, it is also supporting the important commemorations we are conducting at the moment for the first world war.
My hon. Friend also talked about Warwick’s vibrant economy. Our heritage buildings not only provide a wonderful backdrop for the running of modern businesses, but are modern businesses in their own right, attracting thousands of visitors. Around 80,000 people a year visit Warwick town, and many more visit the surrounding area. I know that my hon. Friend has done extraordinary work as a Member of Parliament to promote tourism and discuss with the Government the best ways to help tourism and support the modern economy.
Mr Jim Cunningham
Tourists always come to Coventry first, and then they go to Warwick.
Mr Vaizey
That may be so.
I commend Warwick, old and new. I have here a press cutting with a picture of St Mary’s church that points out that Warwick is one of the top 10 towns in Lambert Smith Hampton’s annual UK vitality index, where it has moved from eighth to fifth place as a place of economic growth. When we commemorate Warwick’s well-deserved 1,100th anniversary, let us remember that it is not only a great historic town but one of the top 10 most vital towns in the country.
Question put and agreed to.
Westminster Hall
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Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
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BMI Pension Fund Compensation
(10 years ago)
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Westminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.
Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
This information is provided by Parallel Parliament and does not comprise part of the offical record
Mark Lazarowicz (Edinburgh North and Leith) (Lab/Co-op)
It is a pleasure to serve under your chairmanship, Mr Sanders.
The issue that I will address today is complex but it potentially directly affects many hundreds of people throughout the UK, including many people in the Edinburgh and Lothian area. In fact, one of my constituents is affected, and they have asked me to raise the issue in Parliament. I am glad to have this opportunity to do that, because the issue has wide implications beyond those who are directly affected by it.
The issue is complex, and I will therefore have to spend a bit of time setting out the background to it. I am sure that those hon. Members who are taking part in the debate will be familiar with the subject and its history, but many of those listening outside this place will not be so aware, so it will be helpful to set out some background.
Let me start with the history. BMI—British Midland Airways—was, as Members will know, a major UK airline. It operated from a number of UK airports, and that geographical spread across the UK is reflected in the Members who have shown a particular concern about the issue. They are from the Lothian area, from London, from Northern Ireland and from the east midlands itself, where the former headquarters of BMI was situated. I know that all of them have been in correspondence with Ministers over a considerable period.
As Members will also know, from about 2009 the airline went into a complex set of changes of ownership. Those changes were stimulated by a decision of the major shareholder and founder of the airline, Michael Bishop, who is now a Conservative peer, Lord Glendonbrook. He exercised an option that resulted in Lufthansa becoming the 100% shareholder of BMI. However, under UK pensions law, at least as applied by the Pensions Regulator at the time, that did not mean that Lufthansa took on any legal obligation to fund the BMI pension scheme.
In due course, Lufthansa decided to sell BMI. However, part of the condition of the sale that Lufthansa agreed with the International Airlines Group, of which British Airways is a major component, was that responsibility for the pension scheme should be removed from BMI. There was a solution proposed by Lufthansa initially, but it was not approved by the Pensions Regulator, for reasons that I will not dwell upon here; they are not directly relevant to the subject matter of the debate.
In any event, the outcome of all these comings and goings was that the BMI pension fund, and therefore the Pension Protection Fund, received £16 million from Lufthansa. In addition, Lufthansa provided a further £84 million to top up members’ benefits outside the PPF, even though it did not appear to have a legal obligation to do so.
Mr Iain McKenzie (Inverclyde) (Lab)
It is a pleasure to serve under your chairmanship today, Mr Sanders, and I congratulate my hon. Friend on securing this debate. Does it seem to him that that move in this takeover was a calculated one to strip 80% of the pension away from those long-serving employees?
Mark Lazarowicz
Well, that was certainly the outcome in many cases; that was what happened to the pension scheme members. Certainly, it was clear that part of the agreement that Lufthansa reached with the companies taking over the former BMI operation was that effectively the pension scheme responsibility would not go with the airline, which is very concerning and, as I have said, has much wider implications beyond the BMI pension scheme, although I am obviously concentrating on that today.
The arrangement by Lufthansa to top up members’ benefits outside the PPF seems, on the face of it, relatively generous. However, hundreds of staff in the BMI pension scheme will lose substantial sums in pension money, and I understand from the British Air Line Pilots Association that there are now some people in the Monarch Airlines pension fund who are in similar circumstances. Hundreds will lose out. At least 30 of the BMI pensioners and 13 Monarch members will lose more than 50% of their expected scheme pension, and that is taking account of the top-up payments from Lufthansa. Her Majesty’s Revenue and Customs has decided that although those top-up payments do not in any sense compensate for the full loss of pension entitlement, they must be taxed. That decision is wrong, and addressing it is the purpose of raising this issue today.
The tax treatment is, of course, intimately bound up with issues about the PPF, which is a wider problem that the Government also need to address. I will try to tackle both the immediate and the broader issue, in so far as I can in the time available this morning.
The Government response to the concerns that have been raised by a number of members of the BMI pension fund scheme has so far been, in general terms, one of sympathy. They are basically saying, “'Well, the tax rules are the tax rules and they must be applied, and that’s really all there is to it.” However, that is not in any sense a satisfactory response—not in the slightest. Ultimately, the tax rules are what Parliament—we as MPs, and our colleagues in the Lords—decide them to be, and the Government have frequently taken action to deal with other situations where the application of the tax law has seemed unfair or inequitable in its outcome.
For example, a couple of years ago the Government decided to impose VAT on building alterations to listed buildings. However, because that change would have hit churches and other places of worship particularly hard, the Government set up a special scheme to allow grants to be paid to those bodies to pay for the costs of extra VAT. When the Government want to find a way round the rules, they can do so.
On another pensions issue, a very relevant comparison can be made with the case of Equitable Life. In that case, although it appeared that the Government had no legal obligation to pay those people whose pensions had been hit by the Equitable Life fiasco, as a result of political pressure they of course set up a fund to pay out compensation—I think it is £1.5 billion in total—to Equitable Life policyholders, which Members across the House had called for. Of course, the payments to the Equitable Life pension holders will be tax-free, because the Government passed a law to say that that would be the case. Yet the Government are trying to distinguish between the logic behind the Equitable Life scheme decision, and that behind the BMI pension fund scheme decision.
In that context, I will quote a previous Minister, who told the House, or perhaps wrote in a letter—I am not entirely certain—that:
“Following an Independent Commission report, The Equitable Life Act”—
That is, the Equitable Life Pensions Act 2010—
“came into effect in December 2010 authorising the Government to make payments to the Equitable Life Payments Scheme. The Act provides that payments under the ELPS are tax free.”
He said, or implied, that there was a contrast with the BMI case, by going on to say:
“The £84 million payment made by Lufthansa is a voluntary payment intended to compensate BMI Pension Scheme members for the reduction in pension benefits they may face due to the BMI Pension Scheme entering the Pension Protection Fund. Where the payment is made into a registered pension scheme, it is subject to the registered pensions scheme tax legislation. As such, the payments will benefit from receiving tax relief when it is made, but that relief is subject to the normal limits within the annual and lifetime allowances. The ELPS payment and the payment made by Lufthansa are therefore fundamentally different and cannot be compared in this way.”
As I have pointed out, the two cases are “fundamentally different” because the Government passed legislation to make them fundamentally different, and not because they are, in essence, fundamentally different. These are both cases in which people lost out because of circumstances beyond their control, and we have a moral duty as Parliament and as Government to respect that in the case of the BMI pension fund holders as well as in the case of the Equitable Life pension fund holders, and indeed in other cases.
Dr Eilidh Whiteford (Banff and Buchan) (SNP)
I congratulate the hon. Gentleman on securing this important debate and I also apologise to him, because I will not be able to stay for the duration. He is making a really important point about the Lufthansa deal. I share his concern about the individuals affected, but does he agree that there are implications beyond this individual deal for staff of other companies that might seek to do copycat deals?
Mark Lazarowicz
Absolutely. I have made that point already and I will touch on it briefly again. Certainly, this raises much wider issues.
Just as the payments quite rightly made to the Equitable Life pension scheme members were compensation—they were not a direct benefit arising from the scheme—similarly, the BMI pension fund members have lost out through no fault of their own, and I believe they require better treatment. The Equitable Life experience shows that where the Government decide that they want, for political reasons, to compensate those who have suffered adversely through circumstances beyond their control, they can find a way to do so. I believe that they should do so for the BMI pension scheme members.
Mr Nigel Dodds (Belfast North) (DUP)
I, too, congratulate the hon. Gentleman. He is making a relevant and important point about the difference in how Equitable Life payments and these payments are treated for tax purposes. When I wrote on behalf of some people in my part of the world, in Northern Ireland, who are affected by this, the Financial Secretary to the Treasury wrote back:
“As I am sure you will appreciate, HM Revenue & Customs has to apply legislation consistently, and does not have discretion to waive rules passed by Parliament.”
We accept that entirely, but the hon. Member for Edinburgh North and Leith (Mark Lazarowicz) is right to say that the rules are what the Government and Parliament decide. In this case there is inequity and it needs to be addressed.
Mark Lazarowicz
I agree. That is precisely my point.
I ask the Minister to take a number of steps and, if she is not prepared to agree to them today, perhaps she will at least consider them and come back to hon. Members at a later stage.
First, it is right for the Government to ask HMRC to review the application of the tax rules in this case. The trustees of the BMI pension fund did lobby for the rules applying to the then annual allowance limits and the lifetime allowance rules to be disapplied in the case of the BMI scheme, because of the special circumstances of the scheme. I should not have thought that it was impossible for it to review the rules, given the special circumstances, notwithstanding the legislation that applies to pensions more generally.
Secondly, if HMRC will not review the position, I ask the Government to consider legislating to make a change for this particular case. Again, the Equitable Life scheme is a model that can be followed.
Cathy Jamieson (Kilmarnock and Loudoun) (Lab/Co-op)
Will my hon. Friend provide some clarification to help me with questions that I may later ask the Minister? I recall that he questioned a former Exchequer Secretary about this issue in Parliament, who offered to set out more detail in writing. Did my hon. Friend receive that information? Would anything that came out of that be helpful in this debate?
Mark Lazarowicz
The Minister sent me a letter that I think was received by all hon. Members who wrote to him about the issue. It was helpful, but I do not think it added anything particular with regard to the concerns that I am raising.
Thirdly, if the Government are not prepared to change the legislation, I ask them to consider making an additional one-off payment to the BMI pension fund scheme to allow payments to pension fund members to be topped up, to at least allow for the fact that tax has been taken off. A parallel to that is VAT on church buildings: although taxes were increased by the Government, a compensation scheme was set up to pay those churches, allowing them to pay the tax back to the Government. Things like that can be done when the Government want to.
Fourthly, I ask the Government to move ahead as quickly as possible with the proposals to allow an increased cap in the Pension Protection Fund for those with long service in the pension scheme. I am aware that this is a matter for the Department for Work and Pensions and that the relevant Minister has been pursuing it, but I hope that the Minister here today will urge her colleagues in that Department to introduce those changes speedily, to ensure that there is at least some benefit, hopefully to members of the BMI pension fund scheme, and to others, who are losing out because of the cap in the Pension Protection Fund provisions.
At a time of financial pressures, it might be said that it cannot be a priority for the Government to find money to top up pension payments to a group of workers who will have been relatively highly paid during their work life and will still receive a relatively high pension compared with the average paid for by the safety net of the Pension Protection Fund. I can see that argument being made. There might be those who are cynical and will say that, whereas millions were affected by the Equitable Life scheme, only a few hundred people spread across the country are affected here and that, bluntly, that is not going to make a difference in the general election next year. Indeed, that would be cynicism, because there is a matter of justice here: these people contributed to their pension over many years and are now going to receive much less than they expected.
To give an example of the sums lost, let me mention my constituent who raised the matter with me, no doubt because he is so concerned about what has happened. Even allowing for the Pension Protection Fund guarantee, he is facing a shortfall of £700,000 on his pension fund. He will receive about £134,000 from the Lufthansa scheme, so when allowing for the tax taken off the Lufthansa compensation, he will still be almost £600,000 worse off.
Let us bear in mind that the employer did not go bust, and the Pension Protection Fund had to bail out the pensions, as it was set up to do. In fact, the previous major shareholder sold his shareholding at a profit that some have estimated to be in excess of £200 million. He sold it to Lufthansa, which then sold the entire company—or most of it, to be precise: of course, bits of it were disposed elsewhere—to IAG. Lufthansa and IAG are both international airline companies whose fortunes go up and down but, bluntly, in most years their profits number in the hundreds of millions and billions of pounds and euros. These companies have not gone bust.
In the middle of all this activity, where some people and companies are making lots of money, the long-standing former staff of BMI are losing large parts of a pension for which they worked all their working life. Of course, through the levy they are paying to the Pension Protection Fund, other companies are paying the costs of compensation going to the scheme’s members, because the pension fund members are no longer receiving it from pension funds and, therefore, from the companies by which they were employed.
As I have said, there appears to be a similar development in the case of Monarch Airlines. Indeed, there is no reason in principle why this type of arrangement could not apply to other company pensions and to people at any income level, not just those who happen to be higher paid, as with members of the BMI pension fund.
Clearly, there is something wrong here, both in respect of the individuals affected by this case and what is happening more generally with regard to how the Pension Protection Fund scheme is used, and particularly in this case. The situation needs to be remedied. The Government need to act, not just for these pension scheme members, but to ensure that this practice is not taken up increasingly by other companies that see a way of escaping from their pension obligations when they choose to restructure or in other ways change the nature of their business and dispose of parts of their operations.
I have taken some time today, but this is an important issue, not just for those affected by these developments, but more widely. I hope that the Government will respond positively to the points that I have made.
Jim Shannon (Strangford) (DUP)
I appreciate the opportunity to make a small contribution to the debate, Mr Sanders.
I thank the hon. Member for Edinburgh North and Leith (Mark Lazarowicz) for bringing this matter forward. He clearly set out the scene for us all. Hon. Members are here because our constituents have expressed concern. We are aware of people from Northern Ireland who are equally disadvantaged because of what has taken place. This debate is of the utmost importance, because it deals with people’s futures and livelihoods. These are the kinds of issues that Members of Parliament ought to deliberate upon.
In 2012, the parent group of British Airways and Iberia, International Airlines Group, struck a deal with Lufthansa, the then parent group of BMI, to buy the company. The attraction of BMI lay in its control of 9% of the valuable slots at London Heathrow. That sets the scene. The matter then became difficult, and BMI employees found themselves disadvantaged. Originally, they thought the deal was a good one, but it clearly turned out not to be.
The deal saw former BMI staff lose £177 million from their pensions, because it was structured so that IAG could avoid taking on BMI’s final salary pension scheme, which was placed into the Pension Protection Fund. I am deeply disappointed that the Pension Protection Fund has not been able to act strongly on behalf of BMI staff. When the Minister replies, she may wish to address that issue.
That arrangement meant that about 3,700 BMI staff and pilots lost at least 10% of their savings, as the PPF pays only 90% of a pension, up to a maximum of £27,000 a year. The hon. Gentleman gave the example of just one person, which shows the magnitude of the figures.
Mark Lazarowicz
Perhaps I should explain that my understanding is that the Lufthansa compensation was graduated in such a way that those with the biggest pension losses got the least compensation. At the top end, only 10% or 20% of the losses were compensated for, and the rest was lost entirely. Those with long service suffered the worst.
Jim Shannon
I thank the hon. Gentleman for his explanation, which helps to clarify the matter.
As a good-will gesture, Lufthansa agreed to pay £84 million in compensation, which staff were offered as a one-off cash payment or which could be added to a defined contribution pension scheme. However, staff were then informed that any cash payments would be taxed. Clearly, there is an issue there. Lufthansa was also advised that it would not have to pay national insurance on cash payments, even though members of the BMI pension scheme were not direct employees of the German airline.
Understandably, that has caused a lot of frustration among former BMI employees. As far as they are concerned, they worked for x years and paid x into a pension scheme, which they are now entitled to, but because of dealings between the parent companies, they are now to lose out. We are here for justice and fair play for our constituents and for those who have been disadvantaged.
At the time, BALPA, the pilot’s union, said:
“Pilots in bmi are rightly outraged that their pensions are to be significantly reduced. These pilots have invested their careers in this airline, and a large proportion of their salary in its pension scheme.”
That is how its members felt, and they still feel that way, because the issue has not been sorted out.
The BMI Pensions Action Group was set up to seek justice for employees who were disadvantaged by the company buy-over. When the possibility of BMI’s sale first arose in autumn 2011, BALPA sought assurances, and reassuring noises were made by Lufthansa, which said that there was nothing to worry about, and the UK Pensions Regulator said it had powers to hold companies to account. Members of the scheme received no communications after December 2011, when Lufthansa said it was going to retain the pension obligation. Those in the scheme were led to believe that they were okay, but they clearly were not.
Mr McKenzie
The hon. Gentleman is making some good points. I am sure he will agree that the people involved have been shabbily treated. Here we see another example of people being asked to prepare for their retirement and old age, but when they near that point, their pension is ripped from their grasp. Perhaps the Minister could take the issue away—we are talking about 4,000 people, not 4 million—and look again at the issue of taxation being applied to what compensation people have received.
Jim Shannon
The hon. Gentleman’s point is clear. It is disgraceful that those whom we represent have been treated shabbily, to use his terminology. Like the hon. Member for Edinburgh North and Leith and my right hon. Friend the Member for Belfast North (Mr Dodds), I ask the Minister to review the situation, because we are talking about 4,000 employees. The Government did that for Equitable Life, even though they said they could not. Members asked in Westminster Hall for that to happen—every one of us here today was probably here for Equitable Life’s members, and we are here today for the 4,000 BMI workers who have been disadvantaged.
Mark Lazarowicz
The Minister might be nervous about how much we are asking to be given away, and it might assist her if I say that the 4,000 is the figure for all the scheme members, some of whom will have been below the Pension Protection Fund cap. All the members have an interest, and they all deserve justice of course, but those who have been particularly badly hit are relatively few in number.
Jim Shannon
The Minister has been listening intently to Members’ interventions, and we know that she takes all the detail on board and responds. We look forward to her response, and we hope we can get answers to the questions we are asking. If we do, that would be good news.
The Sunday Telegraph said BMI pensioners are facing a “double whammy”. They have not only lost out on payments, but now face tax and national insurance payments on what should be straightforward compensation. That is completely unacceptable, and I am glad that we have the opportunity today to say that on behalf of our constituents and those who have contacted us.
We are dealing with people’s livelihoods in what are difficult financial times. As the hon. Gentleman suggested in his intervention, the figures involved are not substantial financially, but they have an impact on a great many people. In some way, these 4,000 people are disadvantaged. They have conscientiously paid into a pension scheme, only to be told that they will not get as much as they were initially promised or what they are due. To top it off, when they were actually offered cash payments, they were told those would be subject to tax. They were almost dragged into the system, but they then found themselves in a difficult position. We must work with the unions to resolve these issues, because these people are being treated unjustly. There are also implications for other pension schemes.
In conclusion, I implore the Minister to take on board the comments made by the right hon. and hon. Members who have spoken and those who will speak later. On behalf of my constituents and other constituents in Northern Ireland, I ask the Minister to review the situation and give scheme members the moneys they should be getting. That is what justice cries for, and that is what we wish to see.
Graeme Morrice (Livingston) (Lab)
Thank you, Mr Sanders, but it is pronounced “Morris”, although “Morreece” sounds quite posh. As always, it is a pleasure to serve under your chairmanship. I congratulate my hon. Friend the Member for Edinburgh North and Leith (Mark Lazarowicz) on securing this important debate.
This issue remains unresolved, and it requires the Government’s attention. I hope that, through the debate, we can make progress for the sake of those affected. The plight of members of the British Midland Airways Ltd pension and life assurance scheme was first brought to my attention by a constituent, Mr Euen Harper of West Calder, who was a pilot. He worked hard over a number of years and conscientiously paid contributions into his pension, but he now faces a set of devastating consequences.
My constituent first expressed deep concern about the scheme back in 2012, when it was placed in the Pension Protection Fund following the decision to sell BMI to the International Airlines Group—a decision that, it should be noted, was between two fully solvent international corporations. That decision has had profound and adverse impacts on the expected pensions of the scheme’s 3,700 members, including those of current pensioners and widows, and it continues to have negative repercussions today.
The most significant of those is the tax treatment of the pension compensation fund offered by BMI’s parent company, Lufthansa. Members not only had to deal with losses to the pensions they worked so hard for, but face being penalised twice by HMRC’s decision to tax the compensation. Jim Snee, chairman of the BMI pensions action group, summarised the scenario that members find themselves in:
“We’ve lost £10, Lufthansa have offered £3 in compensation and HMRC want to tax us on even that small relief!”
The general secretary of the British Air Line Pilots Association, Jim McAuslan, also makes an important point when he refers to it as a double whammy. The decision has added yet another devastating setback to the members’ continuing struggle. I sympathise entirely with those affected and applaud the persistent campaigning of the pilots union and the BMI pensions action group. Indeed, without the action taken by such groups, and the efforts made by hon. Members present this morning, those affected would not have a political voice.
Before making my final point in this brief contribution, it is important to touch on some of the wider issues arising from the BMI pension scheme scandal. While I recognise that this debate is focused on the tax treatment element, the terrible situation faced by members highlights the need for a review of how failed pension schemes are dealt with. It is the view of my constituent and of the chairman of the BMI pensions action group that it is too easy for corporate companies to escape their pension responsibilities. Indeed, a similar situation is currently being experienced by members of the Monarch Airlines pension scheme after it was placed into the Pension Protection Fund this year. It appears that a dangerous precedent is emerging, as it is becoming more common for big corporate bodies to dump their pension scheme obligations. The Government and the Pensions Regulator must do more to ensure that companies cannot manoeuvre their pension scheme responsibilities to the Pension Protection Fund. It is simply wrong that hard-working, innocent members of pension schemes are penalised and that their employers can walk away.
What is evident from my constituent’s story, and that of many others across the country, is the unfairness of the whole situation. The unfairness is most evident among those long-serving members of staff who were due to receive more than £27,000 a year and have now lost 80% of their pension savings. The unfairness means that any chance that members had of receiving a reasonable form of compensation for their grievance has now been dashed. While the compensation offered by Lufthansa is welcome and the tax treatment of compensation for pension cases can be complex, the decision to subject the compensation offered to members of the BMI scheme to income tax is a further blow. It is for that reason that the Government must intervene to get justice for members of the scheme. I ask that BMI pension scheme members are granted the justice of tax-free compensation. I therefore call on the Government to use the powers available to apply discretion in this case. In the same way that the Government granted Equitable Life scheme members tax relief as it was considered the right thing to do, so the Government must do the same in this instance and disapply the rules in light of the treatment of those affected. At the very least, that is what the members of the scheme deserve. I look forward to the Minister’s response.
Finally, I again thank my hon. Friend for raising this important topic. For the sake of all affected, I hope that the matter is resolved speedily.
Mr Andrew Love (Edmonton) (Lab/Co-op)
As always, it is a great pleasure to serve under your chairmanship, Mr Sanders. I congratulate my hon. Friend the Member for Edinburgh North and Leith (Mark Lazarowicz) on securing this important debate.
My hon. Friend raises an important issue on behalf of the employees and pilots in his constituency who have suffered as a result of the collapse of the BMI pension scheme, which entered the Pension Protection Fund in 2012. He talked about the tax treatment of the beneficiaries of those assisted, although I am not sure that “beneficiaries” is the right word to use in this context. The so-called beneficiaries are penalised not only through the tax treatment but by the PPF’s complex rules, checks and balances, which do not operate optimally for this particular group of employees in this particular industry. In fact, they operate harshly.
For example, there is the case of the 51-year-old pilot, a father of three, who will see his pension cut by 44%; or the pilot who has flown for Monarch for nearly 30 years, contributing a significant amount to the company pension fund, who has seen his retirement fund slashed by almost £1.7 million; or the pilot who was just two and a half years away from his planned retirement when he was told that 50% had been wiped off his pension’s value and that a lump sum would not be forthcoming. I ask the Minister, or her colleagues in the Department for Work and Pensions, to take a fresh look at the rules under which the PPF operates. The rules are set by Parliament, and it is through Parliament that those who suffer rightly take up their cause to seek some measure of redress.
With the consent of the Chair, I hope to be able to open out the whole issue to critical scrutiny and to seek the Minister’s support for the difficulties that I shall illustrate and that other hon. Members have illustrated. The problem is not confined to participants in the failed BMI scheme: it looks as though it will also affect the 170 pilot participants and other Monarch ground staff participants in the Monarch Airlines pension fund, which has been under assessment by the PPF since last month. In all, the problem will affect around 300 people, and the problem ranges from the tax treatment of the pensions to the compensation caps operated by the PPF. I shall focus on the compensation cap as it affects the airline industry.
The PPF compensation caps are in place, as far as I understand it, for two main reasons. First, they protect the viability of the PPF itself. The PPF is funded mainly by a levy on its members. Hon. Members will be aware that it is not funded by the taxpayer and that whatever flexibility of treatment for those affected by pension fund collapses I argue for today will not result in any recourse to the taxpayer. I support in principle the concept of compensation caps in order to sustain the PPF, but they were not intended to bear down so harshly on a specific group of workers. Fortunately, those who are particularly adversely affected by the compensation cap are not vast in number. As was indicated earlier, some 3,000 or 4,000 members of the various schemes are affected, and of those some 300 are directly affected by the cap.
Secondly, the compensation cap relates to the concept of moral hazard. The PPF is not designed to be a backstop for those tempted to speculate on or gamble with pension money and then expect the PPF to pick up the bill if their risky ventures do not pay off. I understand and sympathise with that concept as it is right in principle, but why should those who are unable to affect the operation of the pension fund be penalised so harshly? I am not aware that any of the 300 people directly affected were in any way involved with the governance of the pension fund or with high-level business decisions inside the companies concerned, yet in terms of the benefits that they will receive they are being singled out for particularly harsh treatment.
Hon. Members might have noted something in common between the groups of participants adversely affected by those pension schemes: they work for airlines. That is related to the reason the compensation cap mechanism seems to operate so harshly. Thirty BMI pilot members of the scheme and 17 Monarch pilot members face losing more than 50% of the pension income they originally expected. The 67 Monarch pilots alone stand to lose, in aggregate, around £900,000 a year in lost pension, which is an average of £13,500 per pilot per year.
The way in which the PPF operates its cap appears to discriminate against those with shorter working careers: the earlier the retirement, the lower the annual cap is set; and higher compensation awards for long service only kick in after 21 years of pensionable service. The pension cap also operates in a way that is not helpful, given the typical career pattern of pilots in the aviation industry. Pilots normally start their careers in commercial aviation in their late 20s or early 30s, and the normal pension age for Monarch and other schemes is 55 for most pilots. They therefore have far less prospect of accumulating materially more than 20 years of pensionable service.
Only three of the 67 Monarch pilots affected by the cap, for example, have more than 25 years of pensionable service; none has 30 or more years. As a result, many of the 300, although beneficiaries no doubt of membership of the PPF, are left feeling that they have been short-changed and made to pay an unreasonable penalty for no other reason than the career path and pension arrangements available in the aircraft industry. Frankly, such matters are outside their control.
PPF regulations can and do change, often in the interests of equity. Will the Minister undertake to review the issue with her officials and the Department for Work and Pensions to see what can be done to provide a measure of easement? The Pension Schemes Bill is proceeding in another place, so that might be the mechanism through which Ministers choose to make such a change. If that is not possible, perhaps the appropriate Minister will write to me about adjusting the compensation cap, what flexibility the Government have and what amendments, if any, might ameliorate the harshness of existing arrangements. Alternatively, the Minister may ask the Department for Work and Pensions or the PPF to write to everyone taking part in the debate about what consideration the Government have given to the issue and what powers they have to adjust the compensation cap accordingly.
To return to those most severely affected by the compensation cap, the European Court of Justice has expressed the opinion that any compensation restrictions should not reduce the rights of members of an occupational pension scheme to below the 50% level required by the insolvency directive. Will the Minister outline the Government’s attitude to the Court’s judgment and whether as a result the PPF rules will be altered to comply with that view? If so, when?
I am grateful to you, Mr Sanders, for the latitude that you have shown. The matters that I have been discussing primarily relate to the Department for Work and Pensions, but they are the origin of the strong feeling among airline staff that they have been singled out for adverse treatment. I have raised the wider issues of compensation caps as they affect the airline industry, and I hope that the Minister will be able to give a response, or seek one from her colleagues in the Department for Work and Pensions, that will address the patent inequality of the way in which certain pension scheme members are treated under the PPF.
Cathy Jamieson (Kilmarnock and Loudoun) (Lab/Co-op)
It is a pleasure to be in the Chamber this morning, Mr Sanders, and to have you in the Chair once again.
I congratulate my hon. Friend the Member for Edinburgh North and Leith (Mark Lazarowicz) on bringing this important subject before Parliament. Many of us have received representations from our constituents—sometimes relatively small numbers of people in each constituency, but the matter is none the less an important one. It is useful to have the opportunity for a thoughtful debate.
My hon. Friends the Members for Livingston (Graeme Morrice), for Inverclyde (Mr McKenzie) and, most recently, for Edmonton (Mr Love) have given us a wider picture of the impact of the Pension Protection Fund and tax treatment decisions on the individuals concerned. The hon. Member for Strangford (Jim Shannon) also made a contribution, and the right hon. Member for Belfast North (Mr Dodds) and the hon. Member for Banff and Buchan (Dr Whiteford) intervened to make important points that I am sure the Minister will want to respond to as well.
As my hon. Friend the Member for Edinburgh North and Leith said in his opening remarks, many of the former BMI employees who were in the BMI pension scheme have suffered through no fault of their own. They engaged in good faith in the pension scheme, and the decisions taken were not of their making. We are in a quite different situation from some of the other resolutions that have had to come from the Pension Protection Fund, because this does not involve a company going into insolvency—the problem arose largely because the company was sold on. Consequently, the buyers did not have to take responsibility for the pension fund. Again, those are things completely outwith the control of the employees.
As has been acknowledged today, many people might think, “Well, these folks had relatively good jobs and they’ve been relatively well paid”, but there is absolutely nothing wrong with that. The fact that people have been in responsible, well paid jobs, contributing to their pensions in a decent pension scheme, does not mean that if things somehow change or go wrong they have any less right to justice in terms of what they receive in pension. That is the principled position. I fly fairly regularly up and down from Scotland, and I want to know that the people flying and crewing the planes that I travel in—the hon. Member for Strangford might be in a similar position—are well trained, well paid and well looked after for the important job that they do.
As I said, the problem we are discussing was not employer insolvency, as is normally the case when a scheme is transferred to the Pension Protection Fund. We have heard the figures, but the shareholder sold the shareholding for a considerable profit, estimated to be in excess of £200 million. The shareholding was sold on to Lufthansa, which this March announced an operating profit that had risen year on year by 62% to about €1 billion. We are definitely not talking about an insolvency scenario, which makes things a bit different.
We could look at how decisions were reached or how the Pensions Regulator operated, but we are where we are, and we now have to look at the various points that I am about to make to the Minister. What can be done to resolve the tax treatment issue amicably? Perhaps the Minister will answer my question when responding, but what would the financial implications be for the Treasury if it simply resolved the tax treatment in this case? In the global scheme of things, a relatively small number of people might be subject to such taxation, and in order to achieve some equity—my hon. Friend the Member for Edinburgh North and Leith and others have mentioned how the Equitable Life scenario was dealt with—can something more be done to help people?
Another important issue is that we would not want people already in detriment to suffer further detriment because of the taxation rules, which appears to be what has happened with the BMI pensioners. As has been mentioned, the top-up payments that were intended to reduce the detriment are now subject to tax. I am sure the Minister will come back and say, “The tax rules are the tax rules and they have to be implemented.” That is true, but the rules can be changed. In certain circumstances they have been changed and there have been different tax treatments. I have only recently finished dealing with the Taxation of Pensions Bill: we went through a whole Bill to ensure that the way certain things are treated in a tax context can be changed. Where there is a will, there can be a way. That is why I am interested to hear what the financial implications would be. If it is not a huge amount of money for the Exchequer, why can we not resolve the matter in an amicable way? I have a great deal of faith in the ingenuity of officials and Ministers when they want to do something, to go away and find some resources and a way of taking things forward. I hope that the Minister will do that today.
I come back to some of the issues that my hon. Friend the Member for Edinburgh North and Leith raised in his opening remarks. I want to put a number of points to the Minister. My hon. Friend asked the Government to look again and for the HMRC to review the application of the tax rules in this case with specific regard to the annual allowance that might result from the additional tax charge being levied. I would be interested to hear what the Minister is able to say about that.
In her intervention, the hon. Member for Banff and Buchan asked about the implications for copycat deals. Some of the points that my hon. Friend the Member for Edmonton raised are relevant to that. It would be unfortunate to say the least if other companies thought they could somehow avoid doing the right thing by their employees simply by going into the PPF, thereby leaving the problem for others to resolve. As has been said, this is not about increased resources having to come from the taxpayer; it is about the industry taking care of itself, but a degree of equity and fairness has to be looked at in the industry context. Will the Minister, along with her colleagues, look again at the PPF and the rules and ensure that there are no loopholes that incentivise that kind of behaviour, which we would not necessarily think to be a good thing? If HMRC can review that position, I hope the Government will consider the possibility of making necessary changes to the legislation, particularly to ensure that the pension holders affected are not left worse off than they thought they would be at the outset.
I heard my hon. Friend the Member for Edmonton comment on the situation of those in the Monarch Airlines scheme. I am grateful to him for bringing that to our attention in the detailed way he did. I was not fully aware of all those points, and I am sure that the Minister will respond to them. I hope that she will go back to her colleagues in the Department for Work and Pensions to look at the arrangements that have been made to see whether something can be brought forward, even at this late stage, to try to resolve the problems.
In conclusion, we have had a useful debate that has given us information and a number of points on the justice of the situation and the technical details of the taxation system. I particularly press the Minister on the tax treatment of the compensation payments because that is the responsibility of the Treasury, although I recognise that there are wider responsibilities within the DWP. I hope that she will go to her colleagues and assess what she can be done.
The Exchequer Secretary to the Treasury (Priti Patel)
It is a pleasure to serve under your chairmanship, Mr Sanders. I thank the hon. Member for Edinburgh North and Leith (Mark Lazarowicz) for raising this issue in a thoughtful and considered way. I also thank all others Members who have contributed to the debate. In addition to interventions, the hon. Members for Edmonton (Mr Love), for Strangford (Jim Shannon) and for Livingston (Graeme Morrice) made considered contributions.
It is fair to say that this is a serious and important issue. Members have rightfully raised their points and concerns on behalf of their constituents in a considered way. As the hon. Member for Kilmarnock and Loudoun (Cathy Jamieson) just said, these are serious concerns about people’s pensions. These individuals have done the right thing by saving and investing in their pensions. That is right and proper, and they have had the opportunity to do that through an employer’s scheme, which is to be commended. Not only the Government, but all Members are concerned when we hear about issues of this nature.
I start by putting the debate into context from a Treasury point of view. The subject reaches into the territory of the Department for Work and Pensions, and I will come on to that, but it would be helpful if I set out the facts of the case as they are known to the Treasury. Following the sale of BMI by Lufthansa, the BMI pension scheme was admitted to the Pension Protection Fund. Admittance to the PPF for a particular scheme is not a matter for Her Majesty’s Treasury, but for the PPF and the Pensions Regulator. Members will appreciate that I cannot comment on the details of that decision, but I will, as all Members here today have asked, follow up with the Department for Work and Pensions on that. I will also pick up on the point that the hon. Member for Edmonton made on the pensions cap. As he suggested, I will ask for a response on the points highlighted about the DWP, the cap and the Pensions Regulator to be sent to every Member who has contributed to today’s debate.
The PPF provides compensation to members of eligible defined benefit occupational pension schemes. The PPF provides two levels of compensation depending on a member’s circumstances at the time the scheme enters the fund assessment period. The first is for members who have reached their scheme’s normal pension age or are already in receipt of a survivor’s pension or a pension on the grounds of ill health. The second is for the majority of people below their scheme’s normal pension age. Those members are entitled to 90% of the compensation and are subject to the compensation cap, as has been outlined. The PPF rules and restrictions apply to all members, which means that they will not receive all the pension benefits they anticipated. However, while the PPF strives to award compensation fairly, compensation relating to pensionable service before April 1997 does not increase in line with inflation each year, so compensation may not equate to the full value members would have received had their scheme not been admitted to the PPF.
As has been discussed, to compensate BMI pension scheme members for the loss in expected benefits, Lufthansa offered to make an £84 million voluntary payment either as cash payments to the members or into another registered pension scheme on their behalf. The debate is about the tax treatment of that payment. Retirement benefits are subject to tax when they are received, so one would expect the £84 million payment to be taxed.
It may be helpful for me to set out how the tax treatment changes depending on how the payments are made. Where pension schemes can make cash payments to individuals, the tax legislation clearly sets out how those payments are taxed. Any one-off cash payment would be liable to income tax and national insurance contributions, as they are what are known as relevant benefits. It has been put that those payments cannot be subject to income tax and NICS because the members of the BMI scheme were not employed by Lufthansa. However, it is not because the payments are earnings that income tax would apply, but because they are deemed to be relevant benefits. Cash payments are subject to tax as relevant benefits when, for example, they are paid after retirement in connection with past service, as is the situation in the highlighted cases. Relevant benefits are taxable as employment income, and there does not need to be a direct link between the employer and the payee to establish relevant benefits. There is also no statutory requirement for the benefits to be financed by an employer of the beneficiaries. A scheme for the provision of relevant benefits to employees or former employees of an employer commercially linked to the one financing the benefits will be in the legislation for tax and national insurance contributions.
Where payments are made into a registered pension scheme on behalf of the individuals concerned, there will be a different tax treatment. Members would receive pensions tax relief on their share of the £84 million payment as well as the exemption from national insurance and income tax on the payment they would get with any contribution to a registered pension scheme.
However, the payment to a registered pension scheme could give rise to annual allowance or lifetime allowance charges. Let me explain that further. Pensions tax relief is one of the Government’s most expensive tax reliefs and the gross cost doubled from £17.5 billion in 2001-02 to £33 billion in 2010-11. The annual and lifetime allowance has been set to protect the public finances from that growing cost. However, the Government are still likely to forgo more than £36 billion in tax revenue this year and more than £39 billion in 2016-17.
The annual allowance is therefore designed to strike an appropriate balance between providing financial incentives to encourage and support saving for retirement and the fiscal risk to the Exchequer. Therefore, while there is no limit to the amount any individual may contribute to their pension scheme, there is a limit—the annual allowance—on the amount of tax relief those contributions can attract in any one year.
Tax relief is given on contributions up to £40,000 a year, but any contributions in excess of that limit will be subject to an annual allowance charge. To ease the impact of the annual allowance charge, the Government introduced a carry-forward facility, which allows individuals to make use of any unused annual allowances from the three previous years by offsetting them against excess savings. In many cases, that will result in there not being an annual allowance charge to pay.
As a result, the only people affected will be those whose pension savings over the past four tax years, including their share of the £84 million contribution, are worth more than £190,000 for 2014-15 or £180,000 for 2015-16. If an individual takes pension benefits valued at more than the lifetime allowance—currently set at £1.25 million—when they become entitled to those benefits, they will be liable for the lifetime allowance charge. The lifetime allowance charge is 25% if the excess is taken as a pension or 55% if it taken as a lump sum. As the allowance is set at those generous levels, that charge is likely to affect only a small number of people.
Cathy Jamieson
What estimate has the Treasury made of the number of people who are affected by the lifetime allowance charge and what income will the Exchequer receive as a result of collecting that charge?
Priti Patel
I will come on to that and address other Members’ points as well once I have made some progress. Some individuals may have existing enhanced or fixed protection, which means that they can test their pensions against the lifetime allowance at the time at which those protections were granted. That is subject to no further contributions being made to their pension schemes. As payments from the £84 million will be relievable contributions, members who have existing enhanced or fixed protection would lose those rights if the contribution was made to a defined contribution scheme. Again, only a small number of people will be affected by that.
Individuals will have a choice about how they access their share of the £84 million paid by Lufthansa to a defined contribution pension scheme on their behalf. From April 2015, individuals will be able to access the funds as a lump sum or as a series of payments or they can choose to purchase an annuity or draw-down product, provided that they are aged 55 or older. Alternatively, they could choose to transfer to a different pension arrangement. Payments on pensions will be subject to the individual’s marginal rate of income tax and no NICs will be payable.
I will come on to many of the points addressed in the debate. The hon. Member for Kilmarnock and Loudoun mentioned the costs for those affected. Those will depend on the precise circumstances and how payments are made. Such payments made direct to a scheme will be taxable, but the contributions will receive tax relief up to the normal limits. We do not have an estimate of the total cost to the Treasury should tax charges not be applied, but, as I said, that is dependent on the circumstances of how the payments are made.
The scheme was compared in a number of contributions to the Government’s approach in the one-off payments made under the Equitable Life payment scheme. It is worth highlighting that that scheme was established back in 2011 in response to the parliamentary ombudsman report that identified areas of Government maladministration in respect to the regulation of Equitable Life. The Government accepted the then ombudsman’s report and, as a result, made the ex-gratia payment for the loss stemming from what was Government maladministration at the time. The circumstances surrounding the loss of pensions relief for members of the BMI scheme is not owing to the Government’s maladministration and, therefore, it is not comparable in that sense at all.
The hon. Member for Edinburgh North and Leith as well as other Members touched on HMRC and reviewing rules relating to the annual allowance and lifetime allowance. As my hon. Friend the Financial Secretary has set out, HMRC must apply tax legislation consistently and it does not have discretion to waive tax charges intended by Parliament. The legislation is clear in respect of that: all new contributions into defined contribution schemes are tested against the annual allowance and all benefits are tested against the lifetime allowance.
It is fair to say that this is a complicated matter that is not at all comparable to Equitable Life. The Government are familiar with the case, which has been raised by many Members in the debate today as well as in previous representations.
Mark Lazarowicz
I accept that there is no direct parallel with Equitable Life except in the sense that the BMI pension fund members and others have also been the victims of a regulatory system that did not deliver what it ought to have done in some way. In recognition of that, they too deserve some action by Government. Tax treatment is one suggestion, but the House should be able to take forward other suggestions as well.
Priti Patel
The hon. Gentleman makes a valid point that we have an issue with regards to amending legislation that is meant to apply to all pension savers. We are obviously sympathetic and it is clear that the situation is not satisfactory. I will commit to taking away all the considerations and points raised and I intend to raise them directly with the Department for Work and Pensions, because what has happened and the effect that that has had on people is unacceptable. I am unable to be any more specific than that, because I am looking at this matter from the perspective of tax implications and not the overall implications, which would be done by the Department for Work and Pensions.
Finally, I will address a point made by the hon. Members for Livingston, for Banff and Buchan (Dr Whiteford) and for Kilmarnock and Loudoun about the Pensions Regulator and the PPF. I assure the House that the Pensions Regulator has the power to take action when it feels that there is deliberate manipulation in the affairs of an employer who is effectively seeking to walk away from their pensions liabilities. That is a valid point and the Pensions Regulator has powers to deal with that. It would be wrong for any organisation to seek to do that and it is solely for the Pensions Regulator to address that.
It is clearly not right to seek to offload pension obligations for the wrong reasons. The debate has highlighted that where individuals have done the right thing by seeking to save for the future by investing in their pensions, it is proper that we have the right safeguards in place. As I have said to all Members today, I will look to discuss this matter with the Department for Work and Pensions to see how we can take it further.
Housing Need (Treasury Assistance)
(10 years ago)
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Andrew George (St Ives) (LD)
It is a great pleasure to serve under your chairmanship, Mr Sanders. I am delighted to have secured this opportunity to introduce a debate on assistance from Her Majesty’s Treasury for people in housing need, because without question the most pressing and chronic problem in areas such as mine is the lack of affordable homes for the thousands of local families who are inadequately housed or housed in properties with extortionate rental charges.
My area and others are characterised by a very significant mismatch between earnings levels and house prices. There is a large and growing market for second homes, investment homes and retirement homes. Of course, over the years there has not just been the 50% council tax discount for second home owners, which was introduced in the early 1990s; other incentives are available that encourage, that are a further stimulus for, the purchase of second homes especially and investment properties in areas such as mine. For example, people can take massive advantage of small business rate relief if they are letting their properties in the local holiday market, while also of course using them for their own use; and by shifting from council tax to business rates, they can end up paying absolutely nothing in terms of their contribution. That is a further and often hidden stimulus for the purchase of second homes.
I have undertaken surveys of estate agents across my constituency on three occasions, and we have found that over time it has become the case that somewhere between four and six times as many properties are sold to second home buyers as to first-time buyers. That is a very significant and quite shocking statistic. It shows what is going on in markets such as mine. I am not saying that that is happening in the rest of the country, but it is certainly happening in constituencies such as mine, which are very attractive for second home purchases.
There is a rather macho obsession with building homes as the sole, two-dimensional solution to our housing problems, but that does not work. Cornwall has been one of the fastest growing places in the United Kingdom in the past 40 to 50 years, so we have done exactly what successive Governments have encouraged us to do; we are certainly not nimbys. However, although the housing stock has significantly more than doubled in that period, the housing problems of local people have become significantly worse, so we know that simply building thousands of houses is not in itself the answer. We need to do something a little smarter to target those who are in particular housing need in areas such as mine.
I want to address myself to the need to find constructive solutions that would work in areas such as mine. First, I acknowledge and congratulate the Government on some of the things that they are doing. Since 2010, whether there has been new money or a replication of old money or a continuation of programmes that the previous Government had engaged in, we have seen various things happen. We have seen the affordable homes programme, the affordable homes guarantees programme, the trial of direct Government provision—a new delivery model—the affordable rent to buy scheme, which was introduced in 2013, and the new homes bonus, on which an announcement was made yesterday about the latest tranche of money going to local authorities. Of course, that is not just to build houses, but for other economic purposes. However, it certainly provides a stimulus to encourage planning permissions for developments. We have seen the growing places fund, the Get Britain Building fund, the builders finance fund, the estate regeneration fund, the single local growth fund and public land schemes, which have been announced over the years.
In terms of home ownership initiatives, the Government first tried, in 2011, the First Buy scheme, which was closed in March 2013. That was overtaken by the Help to Buy scheme, a very welcome initiative. It replaced the First Buy scheme and is widening the criteria for eligibility by increasing the maximum home value up to £600,000, so it is not just for first-time buyers, but for those looking to move up the ladder. There is the NewBuy Guarantee scheme and the Help to Buy: mortgage guarantee scheme. There is the right to buy and, in a moment, I will come on to shared ownership.
In the private rented sector, there is the Build to Rent fund and the private rented sector guarantee scheme. Then there are other schemes, such as real estate investment trust schemes and self-build and custom-build schemes; and two elements of the recent autumn statement were on the subject of shared ownership.
Obviously, all those schemes and all the things that will provide a stimulus and assistance, which might be targeted at the groups that I am talking about, are welcome, but whether they are sufficient and will help in areas such as mine, only time will tell. I will be making a suggestion today about what we need to do in areas such as mine. I am not saying that this needs to happen across the country, but it certainly needs to in areas with a significant mismatch between earnings levels and house prices and extortionate private rents, and that are characterised by a social rented sector that is significantly smaller than that in many urban areas. Less than 10% of the stock in my area is social rented accommodation.
We need to construct a new lower rung on the housing ladder. The lowest rung on the housing ladder is out of reach for the vast majority of people, who, in other circumstances—perhaps decades ago or in other parts of the country—would consider it reasonable for them to expect to be able to move into home ownership by the time they leave their parental home. I am talking about teachers and nurses—people in stable professions who simply cannot get into the housing market. It is those people whom I particularly want to help—those who have an expectation, a reasonable aspiration, of moving into home ownership, but who simply cannot and are then locked into the extortionate private rented market.
Mr Mark Williams (Ceredigion) (LD)
I apologise for missing the start of my hon. Friend’s speech. He mentions key workers. I represent a rural area, albeit in Wales. I suspect that it is out of the ambit of much of what he is saying, but one problem that we are having now is the difficulty of keeping key workers in west Wales—I am thinking of the health service and teachers—for exactly the reasons that he has identified. Does he agree? Is that a concern in west Cornwall, too?
Andrew George
That is absolutely right. As I said, this issue is not unique to west Cornwall and the Isles of Scilly. The Isles of Scilly has a particular market that is different from that in other areas: it is more like a London market than a rural market. Nevertheless, as my hon. Friend rightly says, this issue is so significant in many parts of the country. It is without question the most significant social challenge that we face. The Government can and should do more, and I hope to encourage them to do so.
I said that we need to construct a new lower rung on the housing ladder. There are problems with shared ownership accommodation. First, there is not enough of it; there is not an effective market. There are only two lenders lending to those purchasing shared ownership accommodation—Nationwide and Halifax—and those lenders are extremely circumspect and apprehensive. They look at these schemes on a case-by-case basis and are extremely cautious, particularly at the point of resale, which is often a significant discouragement to the development of the shared ownership market—that new lower rung on the housing ladder.
Also, occupants tell me that they have to pay near market rents on the remainder, the share of the property that they do not own, and they feel that they are not rewarded for maintaining the property or for any improvements and investments. The cost and burden of maintaining or improving the capital value of the property is not shared with the housing association or registered social landlord that owns the other part of the property. The home owner’s share of the property is often less affordable by the time of sale, and the sale process is often over-long and legally complex.
I note that in the autumn statement the Chancellor announced that the Government would extend the stamp duty land tax multiple dwelling relief to include lease and lease-back arrangements with housing associations on shared ownership properties, with a view to increasing investment in shared ownership. The National Housing Federation has welcomed the measure as something that may be of assistance. Lowering the stamp duty land tax on multiple purchases of property from 4% to 1% may get institutional investors into the market. That can only be welcomed, and it must be kept under review. In addition, I note that the Government intend to work with housing associations, lenders and the regulator to identify and lift barriers to extending shared ownership, which will include consultation on options for streamlining the process for selling on shared ownership properties. I welcome that initiative to work with those associations and others to find a way forward.
I think I have described reasonably well some of the current problems with the development of the shared ownership market. However, the National Housing Federation welcomes the Government’s proposals. I hope that the dialogue will be constructive and that the Government will keep an open mind about the kinds of tools that could be brought into play to enable a significant scaling up of activity in the sector.
When it comes to solutions, my constructive proposal is to ask the Government to act not necessarily as a funder but as a guarantor. The Government—brilliantly, in my view—established the green investment bank. In the same way, I suggest that rather than spending money that they cannot recoup, they should establish an affordable homes fund or intermediate housing fund. Such funding could be revolved to provide the necessary liquidity and confidence among lenders to enable shared ownership schemes to get off the ground, and to facilitate the resale process for such properties. I strongly encourage the Government to look seriously at that proposal.
I am looking forward to hearing from the Minister in a moment, and I have sent her a proposal for the establishment of an intermediate housing fund, on which I have worked with the National Housing Federation. I am not precious about the details of that proposal, but I hope that this Government, the next Government or some other Government—I do not think that this is a party political issue; surely, people across all parties can see the logic and the common sense in this—will consider the concept of such a fund, which would not only benefit the kind of people whom I described earlier, but would be facilitated and enabled by registered social landlords and community land trusts.
Under my proposal, the intermediate housing fund would be administered by the Homes and Communities Agency, although it does not necessarily need to be. It could be an independent body similar to the green investment bank. It would encourage a lending environment that would enable the liquidity necessary to take schemes forward. I believe that it would be a real game changer in the sector and that it would enable progress to be made. I have asked housing associations why they do not engage and buy back properties when people find it really difficult to sell them on, and the housing associations have told me that to do so would count against their contingent liability and restrict their ability to develop new schemes. For various reasons, it would be far better to set up an intermediate housing fund to facilitate such a solution.
The Minister will not be surprised to hear that my question to her is a simple one. Taking into account all that I have described, including the problems and my congratulations to the Government on their work so far, I believe that my proposal is the most significant way of taking the matter forward. Therefore, will the Government look carefully at extending the tools available to develop and scale up shared ownership and other intermediate housing products as an essential solution in areas, such as my constituency, which have high house prices and low wages?
The Exchequer Secretary to the Treasury (Priti Patel)
It is a pleasure to serve under your chairmanship for the second debate this morning, Mr Sanders. I congratulate the hon. Member for St Ives (Andrew George) on securing the debate. He recognised the importance and significance of housing need and housing pressure, while acknowledging the work that the Government have done in the area. Hon. Members come up against many pressures and concerns in their constituencies regarding the affordability of home ownership. There is no doubt that that has been a challenge for the Government. We are addressing the need and introducing schemes through which we can do something about it, and we are engaging with and listening to communities around the country, and with hon. Members such as the hon. Gentleman, on solutions.
The Government are absolutely committed to making the aspiration of home ownership a reality for as many households as possible. Across the country, there is a problem with demand for housing, which has consistently outstripped supply. It was interesting to hear the hon. Gentleman mention that, in his constituency, the demand for second homes is outstripping supply, which is changing the marketplace and having an impact on the ability of first-time home buyers to get on the housing ladder. It is our role as a Government to do what we can to help households that are struggling to get on the housing ladder.
The rate of home ownership in the United Kingdom has fallen from its 2003 peak of 70% to about 65%. We are committed to ensuring that future generations get to experience the benefits of owning their own home in the same way as their parents’ generation did, which is why we have taken clear steps to increase housing supply, build more affordable housing and help people to afford a home without relying on parents and other family members for financial support. The hon. Gentleman has spoken about the reform of planning laws to unlock more housing supply, and that is exactly what the Government are doing. The autumn statement package contained specific commitments to release land with a capacity of up to 150,000 homes, and to introduce new measures to support up to 133,000 new homes, including affordable homes. Affordable homes are the key to this debate. The hon. Member for Ceredigion (Mr Williams) mentioned key workers in his intervention, and they are important. It is incumbent on the Government to ensure that we address key workers’ need when it comes to affordable homes and changes to planning. Key workers support our front-line public services, and it is essential that we have the right kind of housing support for them.
Our policies are bearing fruit. Planning approvals and housing starts are at the highest level for six years. Construction activity, as we see across the country, is really gathering pace and has expanded at the fastest rate for 10 years. We have the national infrastructure plan, which is incredibly important to support housing demand. That contains further measures this year for specific new developments to transform communities through housing in Bicester, Ebbsfleet and Northstowe in Cambridgeshire. Alongside that, billions of pounds of public money—some £4.5 billion during this spending review and more than £5 billion to 2020—is being invested in providing new affordable homes. Almost 217,000 new homes have been delivered by the Government since April 2010, and a further 275,000 will be provided in the five years from April 2015 to 2020. Again, it is about delivering affordable homes in this and the next Parliament.
Under the previous Government, there was a net reduction in social rented homes from 1997 to 2010. That is why, as the hon. Member for St Ives rightly highlighted, we are helping housing associations to access funding. In the 2012 housing package, we introduced a £10 billion housing debt guarantee, which enabled private organisations to access cheaper debt funding to deliver homes for private and affordable rent. We also announced up to £3.5 billion for affordable housing. Our delivery partner, Affordable Housing Finance, issued its first bond to raise funding under the new scheme in May, which was priced at 3.76%—the lowest-priced bond in the history of the affordable housing sector. More than £1 billion of debt has now been guaranteed.
Last week, the Government announced that we have awarded the licence for the private rented sector housing guarantee scheme, which will help create a new market for institutional investment in the private rented sector. All those things help support the Government’s aim of expanding the provision of rented housing, which will help the wider economy by delivering an economic boost and increasing choice. It will also improve housing quality for tenants. Although I do not have time to speak about improving housing stock, it is a key issue for tenants in affordable homes.
We remain committed to establishing shared ownership as a route to home ownership and making it more attractive to households and investors. We will consult on streamlining the process for selling on shared ownership properties. In the autumn statement, we announced that we will extend the scope of stamp duty, which the hon. Gentleman mentioned. Stamp duty is incredibly important, as it affects first-time buyers’ ability to get on the housing ladder. Our scheme is a vital means of supporting home ownership, and it will also cut the cost of property purchasing for up to 98% of buyers.
Building more homes is a priority. The hon. Gentleman mentioned the Help to Buy scheme, which has helped more than 66,000 households to complete mortgages—more than 30,000 have been helped by the mortgage guarantee scheme and 36,000 have been helped by the equity loan scheme. The vast majority of those people—81%—are first-time buyers, which is to be supported and commended. Importantly, more than 94% of all completions are outside London. We are doing everything we can to support the market outside London in constituencies such as the hon. Gentleman’s and rural constituencies, where access to home ownership and new homes has been challenging.
Andrew George
I appreciate what the Minister is saying. Having mentioned shared ownership, Help to Buy and other related schemes, she is coming to the nub of the issue. We must extend the logic of those schemes to the intermediate housing sector. There is still a large cohort of aspiring professional people and others who simply do not have the opportunity to get into the housing market without Government help.
Priti Patel
The hon. Gentleman makes a valid point. He is absolutely right.
On Monday, the Prime Minister launched a new scheme that will offer 100,000 first-time buyers new homes at a 20% discount. That enabling factor is a crucial part of our major push to help people get on the housing ladder. The Government have a role to play in enabling ownership.
In addition to our changes to the planning system, we are freeing up underused or unviable brownfield land. There are many aspects of the housing debate that we could discuss, including planning and turning around land that is not being used in a viable way. We must free up underused and unviable brownfield land from planning costs and levies in return for below market value sale prices for the homes that are built on those sites.
On the hon. Gentleman’s point, I have said that shared ownership is an integral part of the affordable homes programme. His private Member’s Bill seeks to expand the provision of intermediate housing. I assure him that the Government are committed to intermediate housing, and we are always looking at what more we can do to assist, enable and support people.
Andrew George
An earlier draft of my Affordable Homes Bill, which I have shared with the Minister, included a proposal to establish an intermediate housing fund, although I had to remove it because I could not get sufficient political support for it. In my conversations with the National Housing Federation, it estimated that the kind of fund that would be sufficient to facilitate that sector is in the region of half a billion pounds. However, that would be an investment fund, not funding that is lost.
Priti Patel
I welcome the hon. Gentleman’s thoughtful points in this debate.
Housing is a challenging issue, as we have discussed in the short time available. The Government are working assiduously to do many things. I have spoken about the many measures that the Government have undertaken to help the housing market. We are seeing great trends, positive improvements and growth in access to affordable housing. We are providing assistance to aspiring home owners and giving them the opportunity to get on the housing ladder.
Andrew George
This is my final intervention before the Minister concludes. I had discussions with the National Housing Federation, community land trusts and others when I was developing my proposal. As the Government are consulting on how to develop the shared ownership model, will the Minister or one of her colleagues meet me and representatives from the National Housing Federation and community land trusts to see whether we can take these ideas forward?
Priti Patel
I thank the hon. Gentleman for the opportunity to respond to that point. The Government are putting in place many reforms and measures. Again, I thank the hon. Gentleman for his contribution to this debate. Either I or one of my colleagues will discuss this matter further with him to see what else we can do.
I assure the hon. Gentleman and the House that the Government are committed to supporting aspiring home owners—we are doing a great deal in that area— and helping home ownership. We take a continued and significant interest in this area, and we will continue to take a wide range of action.
Post Office Mediation Scheme
(10 years ago)
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Mr James Arbuthnot (North East Hampshire) (Con)
It is a great pleasure to serve under your chairmanship, Ms Dorries. I am new to this. In 28 years in the House, I have never needed to apply for an Adjournment debate, but the way in which the Post Office has treated sub-postmasters and Members of Parliament who have expressed concern about the matter is so worrying, and to my mind shocking, that in my final few months in Parliament it has become necessary for me to apply for an Adjournment debate. To the extent that I make mistakes, Ms Dorries, please correct me and appreciate that I am new to this game.
I am grateful to hon. and right hon. Members for turning up in considerable numbers, which shows the importance of this issue. The background hardly needs explaining. In 2000, the Post Office introduced the Horizon accounting system. A spate of concerns began to arise shortly afterwards. Sub-postmasters across the country experienced discrepancies in their accounts, which they had to balance at the end of each day. Some of those accounts were over what they ought to have been, and some were under what they ought to have been. Some sub-postmasters found themselves closing their post offices on a Saturday with one balance and opening on a Monday to discover that the balance was entirely different. All those discrepancies created such concern that Mr Alan Bates set up the Justice for Subpostmasters Alliance in 2009. He is the hero of this story because he has been working since 2009 for no pay and has been doing a fantastic job.
On the Horizon system, the jury is still out on the software itself, but the fact that no software fault of any major size has yet been found does not mean that none exists. I can give an example because last week Charles Goodwin, a retired computer programmer, wrote an e-mail to me setting out how collusion and fraud by unknown third parties could give rise to some of those cases. He set out how that could come about, which I will not repeat because I do not want to encourage people to do it. His hypothetical fraud, which fits some of the facts of these cases, would be very hard to disprove. If a sub-postmaster who had suffered such a fraud began to complain too loudly, the fraudsters could simply reimburse the sub-postmaster and move on to another victim. The poor sub-postmaster might have been told, as my constituent Jo Hamilton was told, that they are the only person suffering glitches. Such a sub-postmaster would then be tempted to help the fraudster by committing false accounting just to buy enough time to work out what on earth has happened. I am not saying that that did happen; it is just that we cannot prove that it did not happen. On the software itself, and on the possibility of fraud, the jury is still out.
The jury is not still out on the Post Office help system, which was inadequate, as the Post Office acknowledges. I know of two examples in my constituency, and the Post Office is addressing one of them. That reflects the position across the country. Other hon. and right hon. Members will have some cases that they know of and some cases that they do not know of.
Ms Gisela Stuart (Birmingham, Edgbaston) (Lab)
The case of Haji Abbas, who runs the Selsey Road post office in Edgbaston, was investigated. He was found not guilty but his post office was closed. There was an allegation of his having lost £90,000, and he feels that he has lost an additional £60,000, yet the Post Office is not reopening the branch. Someone has lost their livelihood following unfair allegations, and nothing is being done to redeem it.
Mr Arbuthnot
I suspect that during the course of this debate we will hear all too many stories exactly like that one, with awful things happening to sub-postmasters and nothing being done about it. I have already mentioned my constituent Jo Hamilton, who pleaded guilty. She first found that there was a discrepancy of, I think, £2,000. She rang up the help desk, which told her to press certain buttons, and immediately the discrepancy doubled to £4,000. Eventually the discrepancy rose and rose to more than £30,000. There was no proper investigation by the Post Office. She told the “Today” programme last week,
“they couldn’t prove I did it, but I couldn’t prove I didn’t.”
Mr David Jones (Clwyd West) (Con)
Is it a matter of concern to my right hon. Friend, as it is to me, that all the Post Office prosecutions have been conducted in-house? The Crown Prosecution Service has not been consulted, and therefore there has been no element of independent scrutiny prior to the prosecutions’ commencement.
Mr Arbuthnot
My right hon. Friend was the instigator of my first meeting with the Post Office, which was during the previous Parliament. Unfortunately he was then translated to the Cabinet, so he was unable to pursue these issues as he had previously. He is absolutely right, and I will return to his point in my suggestions, which I hope the Minister will consider.
Sir Oliver Heald (North East Hertfordshire) (Con)
The conundrum that one of my constituents had is slightly different. She was prosecuted and found guilty. Her claim is that that was totally unfair and wrong, but she put into the scheme too late for the deadline. Now, of course, she is being offered a review by the Post Office, but she is not very confident that it will do a thorough review. Does my right hon. Friend have any thoughts on that? If it is only a short period after the deadline, should it not be possible for her to go into the scheme?
Mr Arbuthnot
Three or four weeks ago I would have given a different answer to my hon. and learned Friend’s question, but I am afraid that I no longer have faith in the scheme. Whether his constituent wishes to be in a scheme in which she may or may not have faith has to be up to her, but the Post Office certainly should not have an arbitrary cut-off point for examining such issues of injustice. I know that my hon. and learned Friend will continue to pursue the issue.
Huw Irranca-Davies (Ogmore) (Lab)
I have three cases in my small constituency that are outside the mediation scheme, but many people, including me, had faith that the mediation scheme would progress well and give us some hope that there would be a silver lining at some point for those who are outside the scheme. The right hon. Gentleman’s understandable lack of faith shows that there is no avenue for the many people who were outside the initial mediation scheme.
Mr Arbuthnot
I know that the hon. Gentleman was intending to have an Adjournment debate; I am very sorry that I pinched his idea and did it instead. I am grateful for his support on this issue. He has been making these points for some time. We must get to the bottom of these cases, and I am afraid that we cannot rely on the Post Office to see right.
My constituent, Jo Hamilton, pleaded guilty. She had a choice between risking prison for theft and pleading guilty to false accounting, and she decided that the risk was too great. I do not believe that that is the way our criminal law should work. Residents of her village, South Warnborough, do not believe that she is a crook any more than I do, so they paid thousands of pound towards the money that the Post Office was demanding.
Another sub-postmaster, Julian Wilson of Astwood Bank, gave an interview to Radio 5 Live last week. He had a similar story. His wife was convalescing from a tumour and her father had been diagnosed with terminal cancer. He therefore did not want to put his family under strain, so he pleaded guilty to false accounting to avoid the accusation of theft. Like Jo Hamilton, he now has a criminal conviction. Noel Thomas of Anglesey—it is good to see the hon. Member for Ynys Môn (Albert Owen) in his place—was found guilty of theft and sent to prison, as were many others up and down the country.
It may, of course, be that the trade of sub-postmastering was infiltrated by a sudden rash of criminals. I have met a lot of those people, and I personally do not believe it.
Andrew Bridgen (North West Leicestershire) (Con)
Will my right hon. Friend confirm that the Post Office is able to bring criminal prosecutions in cases that have already gone to the Crown Prosecution Service, even if the CPS believes that there are insufficient grounds for a prosecution?
Mr Arbuthnot
As my hon. Friend suggests, and as my hon. and learned Friend the Member for North East Hertfordshire (Sir Oliver Heald) suggested earlier, it is becoming increasingly untenable for the Post Office to act as its own prosecutor without the independent look that the Crown Prosecution Service would bring. My impression is that the Post Office shares that view, and the sooner it can get rid of its responsibility to prosecute—I believe it should happen today—the better.
In the light of all those cases, Members of Parliament got together. My right hon. Friend the Member for West Dorset (Mr Letwin) and I went to see the chairman and the chief executive of the Post Office, who then came to meet right hon. and hon. Members. They suggested that they should set up an independent forensic investigation, and they appointed Second Sight to do that work. Second Sight identified concerns that gave rise to the mediation scheme that we are discussing today.
Second Sight did not identify major software issues in its interim report. It must follow that the mediation scheme was set up to deal with the issues of support and the surrounding issues relating to the sub-postmasters. The Post Office agreed to a mediation scheme that was to include those who had pleaded guilty. It is almost too obvious to say this, but in view of what the Post Office has been doing I have to do so: I would never have agreed to a mediation scheme that excluded people who pleaded guilty, such as my constituent, Jo Hamilton. I would not have agreed to one, and neither would right hon. and hon. Members throughout the House.
That is what the Post Office agreed; let me turn to what it actually did. In the working group for the mediation scheme, the Post Office began this year to argue that the issues of concern that were identified by Second Sight should be excluded from mediation—for example, the absence or ignorance of contracts, and the failure of audits and investigations—despite its agreement with Members of Parliament that the scheme would cover the issues in the interim report. I understand that the Post Office has been arguing in recent months at the working group stage to exclude 90% of the cases coming before the working group, despite everybody’s understanding that exclusion from mediation was to be the exception, not the rule. Extraordinarily, the Post Office argued to exclude people who had pleaded guilty, despite its express agreement to the contrary with me and other right hon. and hon. Members, and despite the fact that it knew that we would not have agreed to a mediation scheme otherwise.
Mr John Redwood (Wokingham) (Con)
I am grateful to my right hon. Friend for leading on this issue and for bravely taking the case of many people in the postal sector to the management. From his discussions with the senior management of the Post Office, is there any sign that it now recognises that it made mistakes? Is there any willingness on its part to recognise that at least some of those people are completely innocent and deserve an apology and compensation for the way that their lives and businesses have been wrecked?
Mr Arbuthnot
That is a very difficult question to answer, because the Post Office pleads secrecy. It will not tell us what is happening in the mediation scheme. We asked in July how the mediation scheme was going, but it refused to tell Members of Parliament because it was all confidential.
Mr Jonathan Djanogly (Huntingdon) (Con)
I congratulate my right hon. Friend on securing this debate and on the huge amount of work he has done on this issue over many years.
Unfortunately, this saga has seriously affected the reputation of one of my constituents. I use the word “saga” because what I find so unacceptable—I think my right hon. Friend was just coming to this—is the delay. For year upon year, people’s reputations have been on the line and sub-postmasters have not known what their status or position is or how the issue is progressing. I find the Post Office’s foot-dragging, inefficiency, and years of delay absolutely unacceptable.
Mr Arbuthnot
My hon. Friend is absolutely right. When people’s houses are being repossessed, as is happening throughout the country, time really matters.
The Post Office has been arguing that these cases should be excluded. It has been doing it at a stage of the process when there is not professional representation in front of the working group, because no professional advisers have appeared before it. Even the sub-postmasters have not appeared in front of the working group when the Post Office is arguing that they should be excluded from mediation. Despite the Post Office’s heralding the payment of professional support for all those sub-postmasters, in practice it is a sham. It is doing it in the interests of the integrity of the scheme.
What conclusions must we reach, therefore? The Post Office has built up the hopes of sub-postmasters so the scheme has their support. It has broken its word to Members of Parliament in so many different respects that it is frankly bewildering. There are many ways to describe it, but I think the best is to say that the Post Office has been duplicitous. It has spent public money on a mediation scheme that it has set out to sabotage.
In the “Today” programme interview last week, the Post Office spokesman said:
“I am really sorry if people have faced lifestyle problems as a result of their having been working in Post Office branches.”
These are not “lifestyle problems”. Jo Hamilton had to get help from her parents as well as from her village. Her mother and her father then both had a stroke. Was that connected? I suspect that it was. Some sub-postmasters lost their businesses, their houses and their reputations; some went through divorces and lost their families; some had to live in their cars; some had health problems; and Noel Thomas and others went to prison. Those are not “lifestyle problems”.
The Post Office spokesman also said that, “It’s not yet over.” If it was up to the Post Office, it would be; the Post Office is trying to close down the mediation scheme. And for some who have been through mediation it is actually over, because they have experienced legal bullying and the Post Office has no intention of getting to the bottom of what went wrong. Documents have been destroyed or lost.
Annette Brooke (Mid Dorset and North Poole) (LD)
I congratulate my right hon. Friend on the enormous amount of work that he has done on this matter. I, too, am concerned about the length of time involved and the lack of information. The mediation process requires information from both sides. My constituents make the point that they requested audit trails and they just have not been given them, which seems to confirm exactly what my right hon. Friend is saying at the moment. Can he confirm that that practice—people not getting the information they need so that they can defend themselves—has been fairly widespread?
Mr Arbuthnot
Well, yes, it has been. My hon. Friend has been working on this issue since the very beginning. Obviously, constituency cases are confidential to constituency MPs. All I can say is that my own constituent, Jo Hamilton, has been told that she cannot have a result until after Second Sight has produced its report in April. I first became concerned about her case in 2008, and this sort of time lapse is utterly unacceptable.
Not only is the Post Office doing this in breach of its word to Members of Parliament and in breach of its duties to the people it works with—the sub-postmasters—but it is undermining and belittling the work of the forensic accountants whom it chose. It is the independence of these accountants, which MPs initially questioned but which we now welcome, that the Post Office finds hard to take.
The Post Office has accepted that its support systems left much to be desired, and as a result it has changed them. The sheer number of calls to the Post Office helpline is astonishing. The calls are from professional users, but tens of thousands of them were abandoned; they were not just made, but abandoned. Jo Hamilton encountered support staff who could not tell her what was going on. She herself had not been trained at all, let alone trained to deal with issues such as this. What has the Post Office done about the absence of such training? It has blamed Jo herself, and others like her, for not having asked for more training, despite the fact that it should have been clear to the Post Office itself, if it was not clear to Jo herself, that she needed such help.
Mike Wood (Batley and Spen) (Lab)
Indeed, has the Post Office not done more than that, because as late as 24 November it announced that a quarter of the staff who provide advice and support to sub-postmasters and sub-postmistresses will be made redundant by the middle of February? So the very poor service that sub-postmasters can draw on at present will be reduced by the Post Office by 25%.
Mr Arbuthnot
My understanding is that the figure is something like that, but I hope that the hon. Gentleman, who has been a key member of the working group of MPs on this issue, will be able to expand on that point when he makes his speech, because I do not know the full detail.
The Post Office carried out no proper investigation into what had happened to Jo Hamilton. Julian Wilson, of the Redditch constituency, was told by Post Office staff that if there was money over at the end of the day, he should put it in an envelope and put that envelope in the safe, and then use that money to pay later shortfalls. It is so obvious that that amounts to false accounting, on the instructions of the Post Office itself, that it is bewildering. He kept asking for audits but the Post Office said, “We’ll audit you when we think you need an audit.” And yet he gets prosecuted and decides to plead guilty.
What allowance has been made by the Post Office for the fact that historically its support was so poor? So far as I can tell, none. What allowance has been made for the contract term that provides that the weakest links in the Post Office—the sub-postmasters—have to be found guilty unless they prove their innocence? So far as I can tell, none. This is not the way that our criminal law should work. What has happened to the money that the Post Office got from people such as Jo Hamilton via the South Warnborough village? Did it get taken into Post Office profits? This is, essentially, an issue of Post Office culture—the protection of assets at the expense of people.
Sir Oliver Heald
If there are problems with the software, or if the system is vulnerable to hacking of the sort that my right hon. Friend described, surely the Post Office would have taken steps to improve the software and/or made sure that it was more difficult to hack its system? Is there any evidence that it took such action, and if it did is that not in itself an admission that the system was vulnerable and that mistakes could have been made?
Mr Arbuthnot
My hon. and learned Friend makes an interesting point. The thing that I am worried about most is that it is often impossible to find those flaws in the software that could have caused some of these problems. Second Sight’s interim report did not find major problems with the software, but as I said at the beginning that does not mean that such problems did not exist.
To my mind, the Post Office’s behaviour towards MPs gives some credence to the complaints that have been made by sub-postmasters about its behaviour towards them; if the Post Office can treat MPs like that, how will it deal with people who are frightened and bankrupt? Somehow in all of this saga, although it is hard to think that it would be possible, the Post Office has managed to tarnish its own reputation still further, while again tarnishing the reputation of sub-postmasters.
As right hon. and hon. Members know, I have handed on the mantle of this campaign to the hon. Member for North Durham (Mr Jones), and I am very pleased to see him in Westminster Hall today. That is partly because I will not be standing in the general election next year, but it is also because, frankly, I no longer trust the Post Office and I will not be negotiating with it further. I did not, as some newspaper reports suggested, withdraw the support of 150 MPs, because I have no right to do so. I withdrew my own personal support and what right hon. Members and hon. Members do now is, of course, up to them.
However, there are other avenues that need to be taken. We need a review by the Government, because we own this organisation. That review must be entirely independent of the Post Office, which has shown it cannot be trusted on the issue. Possibly there should be a special ombudsman.
In my letter to the chief executive of the Post Office, I asked for three things. I asked for no further destruction of documents, and by documentation I mean not only the documentation for those people who are within the mediation scheme but the documentation for those people who have not managed, for one reason or another, to get into the scheme. They have been mentioned already.
I hope the Government can prevent the Post Office from pleading the statute of limitations, because sub-postmasters’ legal actions—some of them caused by the behaviour of the Post Office—should not be barred by the passage of time. I hope that the Post Office and the Government can agree that hon. and right hon. Members should be briefed by Second Sight, not on individual cases, but on the way the mediation scheme has gone.
I wrote a letter to the Post Office at the beginning of last week asking for these things, but I have had no response.
Tessa Munt (Wells) (LD)
My right hon. Friend has already mentioned that evidence needed to investigate complaints by the applicants should not be destroyed. Might he, in his position as leader of this debate, make sure that the Minister asks that the Post Office guarantees that the material gathered and produced by Second Sight remains in Second Sight’s possession and that control of it cannot be given up and that it cannot be destroyed if or when the Post Office instructs Second Sight to do just that?
Mr Arbuthnot
My hon. Friend makes an interesting, worthwhile point. I hope that Second Sight will indeed have a role to play. It is meant to be independent: that is how my hon. Friend the Minister described it in last year’s statement. I hope that its approach to documents will be equally independent. I hope that the Minister is able to assure us of that.
There may be a role for the Select Committee on Business, Innovation and Skills. I am pleased that its Chairman, the hon. Member for West Bromwich West (Mr Bailey) has been in his place today. There should be an investigation by the Criminal Cases Review Commission off its own bat, and even those who have pleaded guilty should be able to take advantage of such an investigation. There will be a role for the courts. I think, therefore, that there will need to be a fund to help sub-postmasters in those actions. It would be good to think that the Post Office itself could, of its own accord, modify its own behaviour. I wish I did think that, but I do not.
Nadine Dorries (in the Chair)
Order. Front-Bench speeches will begin at 3.40 pm. Quite a few Members would like to speak, so I will let them do the maths between themselves. If we are running out of time, I will have to impose time limits on those remaining, but for the moment I will leave it to Members’ discretion.
Albert Owen (Ynys Môn) (Lab)
It is a pleasure to follow the right hon. Member for North East Hampshire (Mr Arbuthnot). Like other hon. Members, I congratulate him and his office on the way they have dealt with Members of Parliament during this whole process—they have been very measured and courteous. He has brought together a groundswell of opinion from MPs and put that articulately to the Post Office.
I share the right hon. Gentleman’s disappointment at the way the Post Office has behaved, because I was one of the hon. Members who initially welcomed a mediation process. A mediation process is one of good will, where both sides volunteer to come together to look for a solution. What we have been talking about in this debate is the destruction of many people’s lives—the lives of many citizens who are well thought of in their communities.
The right hon. Gentleman mentioned Noel Thomas from my constituency, who was a councillor, although not of my political persuasion, in that community, and did more than his fair share of good for people. He ended up in prison because of this system and because he has, I believe—I am speaking personally here—been let down by the Post Office.
In the early stages of the legal matters, I allowed that legal process to go forward, as did other Members. It was not until the Justice for Subpostmasters Alliance was set up that the wider issues were known. I pay tribute to each and every one of those people for coming together and fighting for what they believe to be right.
My constituent Noel Thomas ended up in prison. There were very serious issues, and he lost his home and his business. The impact felt by the right hon. Gentleman’s constituents was felt by many of mine—even in my small constituency I know of five cases of varying degrees of seriousness—but Noel Thomas’s case is the most public and he is the only person I shall name in this debate, although there are a number of others.
The Horizon system has been looked at as there have been problems with it. Many sub-postmasters and sub-postmistresses, some of whom are now retired—their post offices have closed for whatever reason—indicated to me in the early stages in 2001-02 that there were issues of concern at that time in rural areas, when the system was going offline and being rebooted. I therefore find it hard to accept that the Post Office has concluded that there was nothing wrong with the system. I shall mention a little later the lack of support and the helplines because they were important.
The right hon. Gentleman mentioned—I heard it on the radio as well—people being told by Post Office staff, many of them sub-postmasters, to put money aside and to make it up. That beggars belief. There is no evidence of it in many places, because of the trust between the Post Office as the employer and the sub-postmasters who were running their thing.
Mr David Jones
Does the hon. Gentleman not agree that a lot of sub-postmasters who were subsequently prosecuted for false accounting had in effect been encouraged to engage in false accounting by Post Office support staff? In other words, was not the Post Office itself counselling and procuring an act of false accounting?
Albert Owen
Absolutely right. I thought that this system and this scheme were going to identify those issues and that somebody in the Post Office was going to have to answer for their actions, in the way that our constituents have had to answer by going to prison and losing their livelihoods, and various other things. It has been very one-sided.
In another case, the life of a relatively young woman has been ruined because of the accusations. On the advice of a barrister, she pleaded guilty to the lesser charge to avoid a custodial sentence. She feels now that she was let down not just by the Post Office but by the legal system. These are very serious issues. Members from across the House have indicated to me that they are aware of cases being handled in a similar way.
I thought, having had correspondence with other MPs and so on, that this was an independent process. I am now led to believe that the Post Office was judge and jury and was deciding unilaterally which cases were to go forward. I was of the opinion that people who had been found guilty, for the reasons we have outlined, would be allowed to enter the mediation system. I am very disappointed with the way this is turning out, because—I shall repeat this a number of times—we are talking about people’s lives being ruined by this process. I was under the impression that we were moving forward and making progress.
In a third case, a constituent of mine who entered the scheme was helped by the Post Office—as we all know, it paid for the early advice that that person was given—but because their status moved from that of sub-postmaster to employee of another sub-postmaster they were thrown off the scheme. That was discovered at a later stage. Taxpayers’ money had been given to a third party to help that person, to give advice and to come to that conclusion: a complete waste of public money. I argued the case on behalf of my constituent and he was reinstated to the scheme and is moving forward. However, because of confidentiality I do not really know where that case is in the system. A lot of issues need clarification.
I have sympathy with the Minister, because the Post Office, as we know, is not directly a Government body. However, it is a public body that we the taxpayers, and we as representatives, should hold to account. I pay tribute to the right hon. Member for North East Hampshire and others for doing that.
I shall not go over the other cases that I have, because I am conscious of time, but I have given some examples and we have heard others in interventions. However, I feel let down by the Post Office, my constituents feel let down by the Post Office and I think the country feels let down by the Post Office.
I repeat that I have anecdotal evidence—not hard evidence—that this system was problematic. Of course, computer systems—large-scale IT systems across Government and across public bodies—are problematic, but the reason the Post Office will not admit to these glitches is that, as Members have indicated in interventions, and as I am sure they will indicate in their speeches, people were encouraged to do things that were, in many ways, unlawful. That is a disgrace.
The crux of the debate is that the Post Office encouraged people to commit false accounting, and then it penalised them in the hardest way possible—by taking their livelihoods and reputations from them and destroying their standing in the proud communities we represent. The Post Office is iconic, and the people who serve in it do so with pride, but they have been let down, and it is time that this Parliament—the British Parliament—stood up for them. I am glad we are having this debate, and I want some results.
Nadine Dorries (in the Chair)
Order. Could Members keep their speeches to six minutes without my having to impose a formal time limit? Otherwise, we will, unfortunately, run out of time.
Andrew Bridgen (North West Leicestershire) (Con)
It is a great pleasure to serve under you in a debate on this huge topic, Ms Dorries, even if it is for as little as six minutes.
I, too, pay tribute to my right hon. Friend the Member for North East Hampshire (Mr Arbuthnot) for his leadership on this issue over many years. It has been an honour and a privilege to serve under him on his working group of MPs for the last two years.
The issue first came to my attention because of the plight of a constituent, Mr Michael Rudkin. For 15 years, he was a sub-postmaster. He served as the most senior member on the national executive of the National Federation of SubPostmasters and as the chairman of the federation’s negotiating committee. He was responsible for negotiations with Post Office Ltd and Royal Mail Group, so he is an experienced sub-postmaster. I would like to share with Members his experience of the problems with the Horizon system, which demonstrates that significant questions need to be asked of the Post Office, although it is reluctant to answer them.
Mr Rudkin’s story starts on Tuesday 19 August 2008. In his official capacity as a negotiator on behalf of sub-postmasters, he was invited to a meeting at the Fujitsu/Post Office Ltd offices in Bracknell to discuss problems with the Horizon system. If Mr Rudkin is telling the truth, which I have no doubt he is, this sequence of events raises questions about the system, which the Post Office must answer.
On arrival that morning, my constituent signed the visitors’ book in reception and waited for his chaperone, a Mr Martin Rolfe. Mr Rolfe took him to the second/third floor, and they entered a suite where Mr Rudkin recognised Horizon equipment on the benches. There was only one other person in the room—a male of approximately 30 to 35 who was reluctant to engage in conversation with Mr Rudkin or Mr Rolfe.
Mr Rolfe asked Mr Rudkin to follow him through a number of pass card-protected security doors to some stairs. They went down to the ground floor and then entered the boiler room. Mr Rudkin states that a number of men dressed in casual office wear were standing around the doorway. They became very uncomfortable about Mr Rudkin’s presence and left.
Having entered the boiler room, Mr Rudkin instantly recognised two Horizon terminals. There were data on both screens, and an operative was sitting in front of one of them, on which the pure feed for the Horizon system came into the building. Mr Rudkin asked if what he could see were real-time data available on the system. Mr Rolfe said, “Yes. I can actually alter a bureau de change figure to demonstrate that this is live”—he was going to alter a figure in a sub-postmaster’s account. He then laughed and said, “I’ll have to put it back. Otherwise, the sub-postmaster’s account will be short tonight.” Mr Rudkin expressed deep concern, because he had been told that no one had remote access to a sub-postmaster’s account. At that point, he was politely but speedily taken to reception, and he was told to leave the building.
Mysteriously, the next day, Wednesday 20 August 2008, a Post Office Ltd auditor—a gentleman Mr Rudkin knew, by the name of Paul Fields—arrived at Mr Rudkin’s sub-post office. He proceeded to tell Mr Rudkin that his branch had a loss of £44,000. Interestingly, Mr Rudkin maintains that the investigator knew the size of the loss before he even entered the premises.
Mr Rudkin was absolved of all knowledge of the loss by Post Office Ltd, but he was ordered to pay the money back at the rate of £1,000 a month from his salary. As we have heard, the sub-postmaster is completely liable under the contract for all losses. As Mr Rudkin points out, why would someone steal money from themselves when they know that?
After Mr Rudkin had paid £13,000 back to Post Office Ltd, the Post Office started proceedings against Mr Rudkin’s wife for false accounting. It also applied for a confiscation order on all his property and had his bank account frozen under the Proceeds of Crime Act 2002. Mr Rudkin has since cleared all his debts to Post Office Ltd. In the process, he has lost his business, his reputation, his position as a magistrate, some property and his good name, and he has been unable to work since.
Second Sight—the team of independent investigators appointed by the Post Office to look into the matter—questioned the Post Office about Mr Rudkin’s allegations and his visit. Initially, Post Office Ltd consistently denied the visit had ever taken place—until Mr Rudkin produced an e-mail from Mr Rolfe from the day before the visit, which invited Mr Rudkin to visit and said that Mr Rolfe would meet him in reception, at which point the Post Office did admit that the meeting had taken place.
Second Sight has repeatedly requested e-mail data from before, during and after Mr Rudkin’s visit, as well as a copy of the visitor’s book, but all those things have been withheld or are, we are told, now missing. That raises serious questions about the Post Office.
Second Sight told me that it has looked at the contract sub-postmasters are asked to sign and that, in its view, a person would have to be an economic and legal illiterate to be willing to sign it, because it is so slanted in favour of the Post Office. As we know, the Horizon system is imposed on sub-postmasters by the Post Office. Effectively, the sub-postmasters become the fall guys—they are ultimately liable for all losses—so there is little incentive for the Post Office to ensure that the system or the support for it are robust.
The way in which Post Office senior management have dealt with our working group of MPs has been extremely high-handed. I share my right hon. Friend’s concerns: if Post Office management speak to Cabinet members and senior Members of Parliament in the way they do, the way they treat their sub-postmasters must be feudal—
Nadine Dorries (in the Chair)
Order. Could you wind up, please, Mr Bridgen?
Andrew Bridgen
I will, Ms Dorries.
There are many questions to be answered, and I hope that as a result of parliamentary pressure and debates such as this, we will get the Post Office to move to a position where genuine negotiations can take place with aggrieved parties on a level playing field. We are some way from that yet, and I honestly think we will need a full clear-out of Post Office management before we get a change of attitude in this important public institution.
Mike Wood (Batley and Spen) (Lab)
I am pleased to be called in this important debate. I, too, thank the right hon. Member for North East Hampshire (Mr Arbuthnot), who has tried valiantly over the past two to three years to get the Post Office to do the honourable thing by sub-postmasters and sub-postmistresses who have been slighted—all, it would appear, to no avail. None the less, we should place on record our thanks to him for his valiant efforts.
Central to this issue and to the operation of all 11,500 sub-post offices is the Horizon system. We must remember that it is ancient: it was second hand when the Post Office took it on between 1996 and 2000, and it was, in any case, designed for other purposes. We are now 18 or 20 years down the road, and, in IT terms, the system is a dinosaur. If we add to that the problems that are found in all large-scale IT systems when things are bolted on or updated, or when they are expected to interface with systems they were never designed to interface with, we patently have a very flawed, degraded and deteriorating system. That system, which accounts for about 60 million transactions a year, is central to this issue. However, its influence—we might say its malevolent influence—on the lives of sub-postmasters and mistresses is added to by two features. First, there is their relationship with Post Office Ltd and, secondly, there is the attitude of Post Office Ltd senior staff.
Sub-postmasters and mistresses are bound in their relationship with the Post Office by a contract that has been described as Dickensian, but even our Victorian forebears would struggle to justify a contract that is 114 pages long, all in the usual small print, which was first put together in 1994, and which, essentially, places on them all responsibility for problems and shortcomings in Post Office Ltd’s own equipment and system. Therefore, the responsibility for any shortfall or shortcoming rests contractually with the postmaster or postmistress. As the hon. Member for North West Leicestershire (Andrew Bridgen) said, that removes any compunction from Post Office Ltd to do anything about its flawed system, even though it appears to have had the ability to bolt on a facility to alter figures from an individual post office remotely after they have been signed off for the day by the postmaster or postmistress who is responsible for them. The system is flawed, but apparently Post Office Ltd has used it to good effect.
When such a flawed and ancient system is backed up with poor, and often non-existent, training and support, we have the recipe for a disaster. However, we must remember that, in the short term, that is a disaster not for the Post Office, but for those postmasters and postmistresses who get caught out by the glitches and failings in the system that were illustrated earlier.
The second issue is the attitude of Post Office Ltd’s management. The right hon. Member for North East Hampshire and the hon. Member for North West Leicestershire were present when we met the five senior managers of Post Office Ltd—the chair of the board, the chief executive, the chief technical officer and two others—who said, “We cannot conceive of there being failings in our Horizon system.” I asked all five of them about that.
First, that makes us wonder which planet they live on. Secondly, we know that if the organisation operates from the premise that, uniquely, it has a computer system with which there are no problems and can be no problems, that explains its behaviour further down the line. Its investigation department should be renamed, because it has never done an investigation since it was set up. When problems are found, eventually it goes to the individual postmasters and postmistresses and says, “There is a problem here. Patently, it is not our system—it’s faultless—so it must be you. So, now, under caution”—because the Post Office has the ability to prosecute—“without you having legal representation, we would like you to sign a statement that you have taken part in false accounting. Then we will think about not prosecuting.”
People in such circumstances, in the knowledge that there was a problem, are often encouraged to do that by the advice and support team. Many are told, “It’ll sort itself out—don’t worry about it. Put it in an envelope and sort it out later.” Therefore, if they follow that advice, they find themselves agreeing, “Yes, of course that is false accounting—I will sign the statement.”
Nadine Dorries (in the Chair)
Order. That is more than six minutes now, so can you speed up?
Mike Wood
Okay. We need to look to the future, and I support what the hon. Member for North West Leicestershire said about the removal of the very poor senior management in Post Office Ltd, but we must have justice for the hundreds of postmasters and postmistresses who have had their lives ruined by this flawed system.
Katy Clark (North Ayrshire and Arran) (Lab)
It is a pleasure to see you in the Chair today, Ms Dorries. I congratulate the right hon. Member for North East Hampshire (Mr Arbuthnot) on all his work on this issue and on securing what I understand is his first Adjournment debate. I refer to my entry in the Register of Members’ Financial Interests and inform the House that I am the chair of the Communication Workers Union group of MPs. I have had a wide range of discussions with the CWU and in particular with the postmasters branch, which has had a number of its members affected by the issues raised today.
As has already been made clear in the debate so far, this issue has been ongoing for many years. I want to reiterate a point made by my hon. Friend the Member for Batley and Spen (Mike Wood): what has come across clearly to me in discussions with sub-postmasters and mistresses is denial from the Post Office that a problem exists. The experience of those directly affected is that, if a problem occurs in relation to the finances, the initial response from the Post Office is to blame the postmaster or mistress rather than to conduct a serious inquiry to see whether there is a fault in the system or to find out what has gone wrong. That is devastating for the individuals involved, who, as has already been shown, often face years of anguish as a result.
The Communication Workers Union is supporting a number of members who are waiting for their cases to be heard as part of the mediation service. Indeed, one of its members has been suspended without pay for more than a year as he waits for his case to be heard. For more than eight months, another has been facing increasing losses hanging over him despite ongoing involvement with Post Office technical staff who have come to see what the cause of the losses is and to try to find out why there are losses and whether there are gains.
The CWU gets involved with postmasters and postmistresses who are seeking help with the computer system on a regular basis. They are not necessarily being accused of anything, but they are having problems with the system. As workers, they find numerous problems with it, as has been highlighted in the debate.
The general point that comes through is that the support systems provided by the Post Office are inadequate. Wrong advice and assistance is regularly given by the help desks that are there to try to deal with such situations as they arise. Indeed, I have been informed that the technical help desk, which is crucial to identifying solutions when problems arise, is based in the Philippines. Therefore, as well as all the other issues when attempting to sort out technical problems, a significant problem is language difficulties. Will the Minister deal with that in her response? We have already heard in the debate about the job losses threatened and it is clear that the current support systems are inadequate.
The main concern that comes through from those directly affected is that there does not seem to be a fair and open process to deal with a postmaster or postmistress who it is believed might bear some kind of responsibility for a shortage in the accounts. The Communication Workers Union is regularly involved in such cases, even when they do not amount to the serious problems identified in earlier contributions to the debate.
The CWU postmasters branch informed me that it has seen the leaked report issued by the forensic investigator, Second Sight. Indeed, I understand that that report has been seen by many journalists and Members. One of the concerns is the lack of public scrutiny and the fact that these issues are not in the public domain. It seems that the contingent liabilities and the amounts of money involved over many years are significant. That is highlighted in the report and is not officially in the public domain. Indeed, it does not appear in any way in the annual reports and accounts that the Post Office has to publish.
There needs to be a much higher level of transparency because we are dealing with public money. The people whom I have spoken to who have experience of the system accept much of what is in the Second Sight report. Their view is that there is not one single fault with the system, but dozens and dozens of things that make up the problem when one steps back and considers the system as a whole. The major cultural problem we seem to have is that the initial response from the Post Office, despite everything that we have heard today and all the representations made over many years, is that the individual is responsible if there is an issue. I hope the Minister will look seriously at that cultural problem. It is clearly significant. No one is fully clear on exactly why there are all these problems in the system, but all the evidence is that this is an extremely significant issue. It is resulting in low morale among those working in the system, and I hope she will respond fully to the matter.
Mr Kevan Jones (North Durham) (Lab)
First, I congratulate the right hon. Member for North East Hampshire (Mr Arbuthnot) on securing the debate. The Post Office spokesman on the “Today” programme said that some postmistresses and postmasters have lifestyle issues, but may I explain what it has meant for my constituent Tom Brown, who lives in Stanley in North Durham? He has lost his home and an investment property he owned. He has been declared bankrupt and he now lives with his son. His reputation has been dragged through the mud and he has lost in excess of £250,000. He has been a sub-postmaster for 30 years. He has been held up at gunpoint on five different occasions. In 2008, he informed the Post Office that there was a problem with the system. I know many other postmistresses and postmasters did that. He was told, “No problem. It will be sorted out.” At the next audit, he was accused of stealing £85,000. He was arrested by the police and his home and his car were searched, even though he had explained to the Post Office about the problems that had arisen. The police interviewed him. His reputation was dragged through the mud.
As my hon. Friend the Member for Ynys Môn (Albert Owen) said, these people are known in their local communities, so they are not arrested quietly and without any publicity. The police dropped the case. There was no evidence to answer. The pernicious side of it was that the Post Office took him to court under its powers, accusing him of two charges of false accounting. It took until July 2013 for that to get to court. When it did, the Post Office offered no evidence and the case was thrown out.
Can the Minister say what the decision-making process was? Why was the Post Office pursuing prosecutions when the police had looked at some of these cases and found that there was no case to answer? The Post Office put these people through the further agony of being threatened with court action, even though no action was taken when the cases reached court, because it had no evidence. Mr Brown is now in the mediation service and he has a date in the new year. His solicitors advised him, quite rightly in my opinion, to continue his legal action against the Post Office. Like the right hon. Member for North East Hampshire, I think the mediation service is a bit of a joke,
The arrogant way in which the Post Office is dealing with this issue is astounding. Just before the debate started, the Minister’s Parliamentary Private Secretary passed a letter around from the chair of the working group on the mediation scheme. He said:
“I am limited in the information which I can give because the Scheme requires the cases to be treated confidentially.”
What an arrogant way to address a Minister! Who does the Post Office answer to? That is a fundamental point.
This is a national scandal. The idea that more than 150 individual sub-postmasters and sub-postmistresses, who have worked tirelessly in their local communities, for decades in some cases, have suddenly all worked out that they can defraud the system is complete and utter nonsense. We have seen the scandal in the banking system of the way in which LIBOR and other things have been rigged. Those bankers have basically been slapped on the wrist and asked to pay a fine, but these individuals have not only had their reputations sullied, but in some cases they have been dragged through the courts and put in prison. Others, such as my constituent, Mr Tom Brown, have had their lives completely ruined.
I am sorry that I have to say this to the Minister, but it is now time for action. I have been a Minister, and I know that Ministers get a lot of flannel from civil servants saying what can and cannot be done, but I will give her a word of advice: if she is determined enough to want to sort this out, she can do it. What we need from this debate is a clear commitment from her to get the Post Office not only to admit the mistakes it has made, but to sort this scandal out. People’s lives have been ruined—decent, honest and hard-working people. That is just not fair. If it happened in any other area of life, it would be a national scandal. It is a national scandal in my opinion. I am looking to the Minister to ensure that something gets done. If her civil servants come back and say she cannot do X, Y and Z, she should just keep challenging them.
Huw Irranca-Davies (Ogmore) (Lab)
In the short time available, I first thank the right hon. Member for North East Hampshire (Mr Arbuthnot) and those involved in his group for their hard work. I am dismayed that he and many of the group have lost faith. My sub-postmasters, who are outside that scheme, were pinning their hopes on a successful outcome that could point the way forward for them. They now feel exceptionally let down as well.
Sub-postmasters have been hung out to dry. They are either being accused of mass fraud—of being rogues—or of mass stupidity—of being fools. I am not naive enough to believe that there are not some rogues out there. There might be some fools out there, too. There are enough in this place. Even families have them, but the idea that there is mass criminality, mass fraud, mass stupidity, mass ineptitude or mass deception going on, worthy of some sort of criminal fraternity such as SMERSH or SPECTRE in James Bond or some society of clowns who cannot even add up—before Horizon, they certainly could add up; there were no problems before—stretches the bounds of the imagination.
In response to some of the points that have been raised, all but three of my sub-postmasters in Ogmore are deemed to be rural. I have three cases in a very small constituency. All three are different in their nature, but they all consistently say the same things. They have all had problems with the interface between Horizon and existing schemes. They have all had problems with downtime on Horizon during the period in which it was introduced, which messed up their calculations. The lack of support and training given when that happened was appalling. They all say that the subsequent lack of training and support when incidents arose was appalling. They have all had to dip into their own pockets, as sub-postmasters have to, to make good on this. That seems utterly bizarre. What business practice insists that they have to do that? All my sub-postmasters are outside any scheme. We were hoping that the scheme would give resolution, at least to those who were within the mediation scheme, and point the way forward. I refer the Minister to a debate on 9 July 2013, when she made her statement. I put that exact point to her then. I said that my people are not in the scheme or any future scheme. I had two cases at the time and I now have three. I ask the Minister again: where do they go?
I will concentrate on just one of the three cases. My constituent was asked in 2008 to repay more than £5,000 to Post Office Ltd as a result of discrepancies of the like we have heard about today. He claims that it was the fault of the Horizon computer system, but also the fault of a lack of training, support and follow-up when difficulties arose, which I suspect is exactly what the Second Sight report, when it eventually comes out in March or April, will say is happening. That is a pertinent point: it cannot just be the computer hardware. The lack of support and training, the downtime and the software interruptions are all pertinent, but they do not seem to have been taken into account.
My constituent had spotted the error some time before. His daughter says that he had somehow tried to adjust the matter by repaying more than £29,000 voluntarily to the Post Office. He was then investigated and suspended from his role. The Post Office may seek full repayment, which would amount to more than £70,000, and criminal charges have not been ruled out. His family describes him as a broken man. That is not good enough. What help will the Minister now give to those who have been let down by the mediation scheme? What will she do with the potentially hundreds of people who did not came forward initially and now also want to seek justice?
Ian Murray (Edinburgh South) (Lab)
It is a great pleasure to serve under your chairmanship, Ms Dorries. I pay tribute to the right hon. Member for North East Hampshire (Mr Arbuthnot) for securing this debate. I cannot believe that this is his first Adjournment debate after 28 years of distinguished service in the House. It is probably better late than never given the content of his speech. I wish him well when he goes on to other things after May.
I am disturbed by what we have heard this afternoon. I have been involved in the matter since the Minister made her statement to the House last year, but we have heard troubling stories about people having their lives turned completely upside down through no fault of their own. I was particularly concerned by the story of my hon. Friend the Member for North Durham (Mr Jones), who will be a fantastic new leading Member for the Justice for Subpostmasters Alliance, about his constituent, Tom Brown. He gave 30 years’ service to the Post Office, but he has now lost his home and lives with his son and has been declared bankrupt after losing more than £250,000, which has been described by the Post Office as a lifestyle choice. I hope that Post Office representatives, who will be watching this debate, will reflect on the stories that Members have described today and do something about this.
At the statement last year, I made the point that we welcomed the fact that the Post Office had recognised that there were problems with the Horizon system. At that point, it seemed that the Post Office would do something about it. Since then, however, nothing has been done. Like everyone else, I have in front of me the letter from Sir Anthony Hooper, the chair of the working group, the reverse of which details how the 150 cases have been progressing over the past few months. The information seems incomplete, and it would be useful to hear about the conclusions in the seven cases that have been mediated. Was it found that the Horizon system was incorrect? Was it found that the sub-postmaster lacked training or support? The conclusions and information need to be reflected back, perhaps privately, to the Minister and the working group.
I was struck by the contributions of the hon. Member for North West Leicestershire (Andrew Bridgen) and my hon. Friend the Member for Batley and Spen (Mike Wood), who made the point that the Post Office’s contracts mean that sub-postmasters are completely responsible for any losses incurred. There is no carrot and stick approach in stealing from one’s own business. Instead of robbing Peter to pay Paul, sub-postmasters would be robbing Peter to pay Peter because their contracts mean that they are completely responsible for the losses incurred.
The Second Sight report came up with some preliminary conclusions that are worth reflecting on in the context of today’s debate. It found no evidence of system-wide problems, which causes me a great deal of concern because we continually hear about significant issues, which may point to deeper problems in the system if the professionals cannot find major problems. It found two incidents where defects or bugs in the Horizon software gave rise to losses of some £9,000 in 76 branches. It mentioned individual postmaster experiences when reporting problems and the lack of support and of a user forum. It described a lack of an outreach investigations function within the Post Office to investigate problems. It also mentioned problems with the trading period and the process for transactional corrections and that there was no “suspense account” option, which made it difficult for transactional corrections to be dealt with in a neutral manner.
I am concerned by the language used in this interim report. Conclusions have been made, but we continue to hear about the significant problems experienced by sub-postmasters up and down the country. We must also reflect on the fact that the Post Office was encouraging postmasters to break the law on accounting. Asking someone to allocate accounting to a different period in order to make up losses is creative accountancy.
More than 144 Members have supported the campaign. The right hon. Member for North East Hampshire has written to the Post Office to say that he has no confidence that the Post Office board is committed to finding a fair solution to this particular problem. The Post Office board must reflect on that, but the Minister has a role to play here. I agree with the hon. Member for North Durham that she must get a hold of the situation and find a conclusion to it. The more it goes on, the more we will hear of sub-postmasters ending up in prison or declaring guilt for something that they have not done in order to avoid a custodial sentence. That is not how justice works in this country and it is not how justice should be seen to be working.
I want to pose several questions to the Minister, and I will sit down early to allow her time to respond to the significant questions that have been asked during the debate. First, what is her response to the letter to the Post Office from the right hon. Member for North East Hampshire about the cases that were recommended for mediation by Second Sight? Can she confirm that that is happening? If so, what is the solution?
Secondly, what discussions has the Minister had with the Post Office about cases that have been refused mediation and where the sub-postmaster involved has previously pleaded guilty to allegations of impropriety? When people have been given custodial sentences or criminal records, those cases must be looked at seriously.
Thirdly, will the Minister take urgent action to resolve not only the outstanding cases, which we can see in the letter from the chair of the working group, but the cases described by hon. Members that have arisen since the closing date of the mediation scheme?
Fourthly, will the Minister address the JFSA’s loss of confidence in the Post Office system, as highlighted in the letter from the right hon. Member for North East Hampshire?
Fifthly, what discussions has the Minister had with the Post Office and the prosecution services regarding the prosecution of sub-postmasters? Will she make a statement to the House regarding that?
Finally, do the Government have any further concerns regarding not only the Post Office’s handling of the matter, but the Horizon system?
We must reflect on the horrendous worst-case scenarios that we have heard from hon. Members. I plead with the Minister really to get a hold of the matter, to answer Members’ concerns, to do justice for the many hard-working sub-postmasters up and down the country who feel that they can no longer have confidence that things are being dealt with correctly and to ensure that such issues do not occur again.
The Parliamentary Under-Secretary of State for Business, Innovation and Skills (Jo Swinson)
I congratulate my right hon. Friend the Member for North East Hampshire (Mr Arbuthnot) on securing this debate on the review and mediation scheme relating to the Post Office and Horizon. He set out his concerns clearly and eloquently and cares passionately about the subject. He has worked tirelessly over a long period of time on the matter, as have many other hon. Members present today. I appreciate hon. Members taking forward their constituents’ concerns. Today’s debate obviously follows on from the statement in the House of July 2013 and the important foundations laid and commitments made at that point.
I have listened carefully to the concerns expressed by hon. Members today and I recognise the real and genuinely distressing situations described and their concern for their constituents. I wanted to respond as thoroughly and fully as possible to the debate, so I was keen to get views on how the scheme was going from the working group. I contacted its chair, Sir Anthony Hooper, and received a letter back from him, copies of which I circulated to hon. Members present. I had placed it in the Library of the House yesterday, but, appreciating that not everyone would have noticed that that had happened, I thought it would be helpful to bring copies along today.
Sir Anthony Hooper is, of course, a Court of Appeal judge. He was appointed chair of the working group at the suggestion of the Justice for Subpostmasters Alliance. His appointment was welcomed by many hon. Members, including my right hon. Friend the Member for North East Hampshire, who I understand still has confidence in Sir Anthony as chair of the working group.
Sir Anthony Hooper has set out the confidentiality requirements clearly and, as such, was not able to have a discussion. He said that he could give only limited information—that was not Post Office Ltd, as the hon. Member for North Durham (Mr Jones) suggested, but the Court of Appeal judge. Sir Anthony has provided details of the number of cases and the progress made. So far, the scheme has received 150 applications, with 10 cases resolved before the scheme started, four applications rejected outright and a couple of cases resolved after investigation. The rest of the cases are working their way through the scheme and are at different points on the timeline. So far, 24 cases have been recommended for mediation by the working group, of which only two have not gone to mediation because the Post Office has not been happy to mediate—
Jo Swinson
I will give way after the next sentence or two. I understand the concerns expressed by hon. Members, but two out of 24 is nothing like the figure of 90% that has been put forward. A basic principle of mediation is that both parties agree to it voluntarily, so that it can be entered into in the proper, constructive spirit.
Jo Swinson
I will give way to the hon. Member for Batley and Spen (Mike Wood) first. I will tally up the interventions.
There would be no point in entering a mediation if one of the parties was adamant that it could not reach any possible positive outcome. Most of the cases recommended for mediation, however, are going to mediation.
Mike Wood
Is the Minister happy that the mediation process, which started on one basis, is now being interpreted on a completely different one by the Post Office? As a result, the vast majority of cases listed as going through the process will be excluded and never get to mediation. Is the Minister happy about that?
Jo Swinson
I do not accept the premise of the question. The scheme was set up and it was agreed that any case could apply to the scheme, even those cases in which the individual had pleaded guilty to a charge. The working group, which is made up of representatives of the Justice for Subpostmasters Alliance through Second Sight, the Post Office, and its chair Sir Anthony Hooper, will consider the report from Second Sight about whether a case should go to mediation. As a result of the process, the cases then go to mediation, but it was never anticipated that every single case would do so. There is the point at which the working group considers it.
Jo Swinson
I will give way to my hon. Friend the Member for North West Leicestershire (Andrew Bridgen) first, then to my right hon. Friend.
Andrew Bridgen
I do not know what the Post Office has been saying to the Minister, but it has been saying a different story to the MPs on the working group. We have heard examples of people losing everything in their life, but is she aware that one of the criteria for refusing mediation is the Post Office stating that the claim by a sub-postmaster for compensation is too high? In other words, if sub-postmasters have suffered a huge loss, the Post Office is using that as a criterion to exclude them from mediation—because their claim is too large, because they have lost too much.
Jo Swinson
At present, we are talking about only two cases in which that has happened—the Post Office has refused mediation in only two cases. Perhaps there is some degree of confusion, but Sir Anthony Hooper, the independent chair of the working group, provided that information. If hon. Members wish to challenge it, I will happily go back to Sir Anthony about the information provided. I have to work, however, on the basis that that Court of Appeal judge is providing me with accurate information. I hope hon. Members appreciate that.
I will now give way to my right hon. Friend the Member for North East Hampshire.
Mr Arbuthnot
To be clear, I have not lost faith in Sir Anthony Hooper as the chair of the working group. I have never said, however, that 90% of the cases have been rejected. I have said that the Post Office has recently argued that 90% of the cases should be rejected, and that that is where the breach of faith and the lack of straightforward dealing lies.
Jo Swinson
This is slightly difficult territory, because the working group discussions are confidential. I do not go to those discussions or know what is said in them. I cannot find out what is said in them. Indeed, every party involved in the discussions is bound by confidentiality. So I do not know whether the information mentioned by my right hon. Friend is in fact accurate. That said, I point to the information that we do have from Sir Anthony Hooper, which is that even if what my right hon. Friend says is true and the Post Office has argued for some of the cases not to be mediated, none the less it has gone into mediation on them. In a sense, the point is slightly academic, although I understand the concern on the part of hon. Members. I also take on board and take seriously the comments made by more than one hon. Member about the attitude of senior staff from Post Office Ltd to groups of MPs.
Mr David Jones
Looking beyond the issue of mediation, it is clear from what we have heard in the debate that a large number of people have had their life ruined because they adopted accounting practices on the basis of advice given to them by the Post Office. In other words, as I said in an intervention, the Post Office itself was counselling on procuring false accounting. Has my hon. Friend the Minister considered referring that matter to the prosecuting authorities?
Jo Swinson
My right hon. Friend is right to recognise that the accusation is a serious one—if true, it would be incredibly serious. It is difficult to know whether that is the case, which is why full investigation is needed. The hon. Member for North Durham made a clear challenge, and a fair one, about ensuring that we get some action and resolution on the issue. The point that I push back on is that many of the cases are incredibly complex, understandably so, because they are dealing with systems and many transactions—
Jo Swinson
In order to do something, what is required is independent investigation that is done thoroughly and forensically—
Jo Swinson
I will finish the point, if hon. Members will allow me.
The hon. Member for North Durham said “do something”, and in such a situation what I would normally propose doing is to get a team of forensic accountants to go through every scenario and to have the report looked at by someone independent, such as a former Court of Appeal judge. We have a system in place to look at cases therefore, but if particular cases can be mediated, that is an ideal solution. If any information comes to light during the course of the mediation or the investigations, that suggests that any of the convictions that have taken place are unsafe, there is a legal duty for that information to be disclosed to the individuals convicted and to their legal representation. I fail to see how action can be taken without properly looking in detail at every single one of the cases through exactly the kind of scheme that we have set up.
Albert Owen
I understand the difficulty of getting involved in the mediation, but will the Minister tell senior managers of the Post Office that they need to look at some of the specific accusations made against their staff of giving certain information to people who have ended up in court and in jail?
Jo Swinson
Absolutely. That is a serious accusation, and many serious issues have been raised in the debate and in correspondence that Post Office Ltd needs to look at and to respond to, perhaps to reassure itself that such things did not occur, or to look into whether they were the case and, if so, to take appropriate action. We do not for a second take lightly the issues raised today, but I caution against the expectation of some swift and easy magic solution. We have to look at the details and the facts, and that has to be done forensically. That is why Second Sight, the team of forensic accountants, has been employed and why we have someone of the calibre of Sir Anthony Hooper to oversee the process.
Nadine Dorries (in the Chair)
Order. If the Minister wishes to wind up, there are only a few seconds to go.
Jo Swinson
I will take away the points made by hon. Members in the debate. I am sure that the issue is one that we can return to in future.
International Money Transfer Charges
(10 years ago)
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Dame Tessa Jowell (Dulwich and West Norwood) (Lab)
It is a great pleasure to serve under your chairmanship, Ms Dorries.
This Christmas, millions of people will work extra hours in difficult and low-paid jobs so that they can send money to their relatives living abroad. Their remittances, particularly to sub-Saharan Africa but to many other parts of the world as well, now account for more money than donor aid. However, their money transfers will be hit by fees and charges that can be as high as 15%, and in some cases even higher. Five years ago, the G8 committed to reducing this “transfer tax” to 5%, but the deadline for international action has now passed and the target has not been achieved. People who seek to send relatively small amounts are being hit disproportionately by high fees; I am calling for concerted action to change that.
Take, for example, Dorothy Mukasa, who arrived in the UK from Uganda 34 years ago and, like so many thousands of migrants, works for the NHS. Over the years, her family in Uganda have needed her help. For example, she has sent money home to pay the school fees for her orphaned niece, and she currently pays for a nurse to attend to her elderly parents twice a week. Dorothy explained her anger at the extortionate charges that she has to pay, because sending relatively small amounts can incur higher charges. Her case was recently highlighted by The Observer newspaper.
I applied for this debate because of the circumstances of people like Dorothy who are being hit by the double effect of poor foreign currency exchange rates and high fees, of which a key driver in certain parts of the world is the lack of competition in the market. When chairing the Africa Progress panel earlier this year, Kofi Annan highlighted the control that money transfer companies have over the market. He said that the two largest such companies, Western Union and MoneyGram, both
“operate exclusivity agreements with their agents and commercial banks, which raises the cost of market entry.”
He went on to say that money transfer operators
“account for US$900 million taken from African migrants and their families through excessive charging.”
The situation was also illustrated in this year’s groundbreaking report from the Overseas Development Institute. The fees being charged are disproportionately high and far above the 5% level set by the G8 and the G20. The ODI showed that when the fee and, critically, the foreign currency exchange rate were combined the margin levied by MoneyGram would see someone sending £120 to Malawi incurring a 22.4% cost. Sending the same amount to Senegal and Ghana would have costs of 19.9% and 11.4% respectively. It is important to say, however, that MoneyGram disputes those figures.
In the case of Western Union, the other big money transfer company, the ODI’s research shows similarly high charges. The cost of sending £120 to Gambia was 14.2%, and to send the same amount to Uganda incurred charges of 13.4%. The ODI’s research showed that between them Western Union and MoneyGram control two thirds of the remittances market in sub-Saharan Africa. The problem affects not only those sending money to Africa, but large parts of Asia and Latin America as well.
A further challenge is the severe lack of transparency about the components of charges. For example, figures taken from MoneyGram on Saturday show that sending card-to-cash transfers of £100 to six countries in different parts of sub-Saharan Africa incurred a uniform fee of 12%, plus further currency exchange charges. The four countries have different market conditions and underlying factors, yet the basic fee of 12%—more than double the G8 standard of 5%—is the same for each of them. People do not understand why. Along with financial regulators, the UK Government should require companies to be more transparent about such charges, in the interest of consumers. I would like to commend TransferWise for its campaign, which I support, calling on the UK Government to put a stop to hidden fees and to stop banks and brokers overcharging consumers in foreign currency exchange.
The G20’s conclusions show that Governments are aware of the scale of the problem. At the G8 L’Aquila summit in 2009, world leaders agreed to bring the cost of remittances down to 5% within five years. The G20 formally adopted that objective in 2011, but the deadline was missed two weeks ago. At last month’s G20 summit in Brisbane, which was attended by the Prime Minister, world leaders reaffirmed the 5% commitment, but they appeared to weaken their ambition by failing to agree a deadline by which they would act. Perhaps the Minister can assure us that that is not the case for the UK Government. I am very concerned by that omission and I would like reassurance from the Minister on the Government’s determination to tackle the problem.
There are many issues surrounding remittances, and I fully accept their complexity. One such issue is the availability of accounts for money transfer companies. Earlier this year, owing to concern over lack of control of funds, Barclays announced that it would be closing 250 UK accounts held by money transfer companies that deliver remittances to families in developing countries. This year, my hon. Friend the Member for Bethnal Green and Bow (Rushanara Ali) led the successful “Save Remittance Giving” campaign, which called on Barclays to reverse its decision and on the Government to throw a lifeline to families in developing countries—particularly Somalia, which faces significant challenges in this respect—by co-ordinating action between the Government and financial regulators in order to secure a long-term solution. Like other Members, I am sure, I want to put on the record my thanks to my hon. Friend for her continuing work on this issue.
A key issue that I have already mentioned is the lack of effective competition, which works against consumers. Between them, Western Union and MoneyGram control two thirds of the remittance market in sub-Saharan Africa. That market must be made more open to a wider ranger of companies, including smaller, secure companies, to ensure that there is a competitive market. The issue has been highlighted by the Association of UK Payment Institutions and its executive chairman, Dominic Thorncroft. The AUKPI represents 120 payment institutions in the UK, and it notes that, since the collective decision of the UK banks in 2013 to stop trading with money remittance firms, more than 150 Financial Conduct Authority-regulated UK money remittance firms have lost their bank accounts and since then struggled to be able to offer money remittance services to their customers.
Some firms are taking action to try to offer alternatives in the market. An example is Xendpay.com, which is a service set up by social entrepreneur Rajesh Agrawal in response to the high charges levied by the big and dominant money transfer companies. However, right now consumers have less choice, and overall fees and charges have inevitably increased. Policy makers, including the UK Government, are just not doing enough to encourage greater competition, which would begin to tackle very high charges. By analogy, we would not tolerate a situation in which two companies controlled two thirds of our energy or banking markets, and we must not tolerate that in the international remittance market either.
Remittances are big business, and the lack of transparency, effective regulation and competition means that very substantial profits can be made by just a few big players. In 2013, Western Union handled £52 billion of transfers between customers. It returned over £420 million to shareholders through dividends and share repurchases. I believe there needs to be a balance between the commercial interests and success of these important companies and the decency of the business, taking into account the population of consumers on whom they rely. That is why I have called on MoneyGram and Western Union particularly to halve their fees in the run-up to Christmas—a time of giving—as a gesture of good will, and as a small stepping stone towards a more permanent solution.
I hope that the Minister will be able to give a commitment that her Government, should the opportunity arise, will act between now and the general election to reaffirm the commitment of the G20 last month and begin to set out specific proposals on how the UK Government might offer leadership in this area to bring down transfer charges. I also hope that her Government, until the election, will agree to speed up the necessary action to force money transfer companies, banks and brokers to be more transparent in their charges and, in particular, their foreign currency conversion rates. Hundreds of thousands of very hard-working people, doing some of the toughest jobs in our country, just want to support their relatives in some of the poorest countries in the world, and I hope very much today that the House will show its support for them too.
The Economic Secretary to the Treasury (Andrea Leadsom)
It is a pleasure to serve under your chairmanship today, Ms Dorries. I thank the right hon. Member for Dulwich and West Norwood (Dame Tessa Jowell) for raising such an important topic. I say to her, first, that it has taken up a lot of my time since I have been in this role. It is a very complicated issue and it is very important to me that we get it right.
I also congratulate the right hon. Lady on raising the issue with the Prime Minister at Prime Minister’s questions earlier today. As he set out, the Government are acutely aware of the importance of remittances from UK residents that are sent to their family and friends in developing countries. Annual remittances from the UK amount to more than £15 billion. In the specific case of Somalia, remittances support nearly 3.5 million people and account for approximately half of Somalia’s gross national income. Since I came to this job earlier in the year, I have therefore personally been making sure that the Government are doing everything we can to ensure that remittances continue to flow through accessible and secure channels from the UK to all regions of the world.
The House will be aware that transparency of fees and charges for financial services products and competition between providers are key priorities for the Government. Increased transparency promotes greater competition, it provides better outcomes for customers, and it helps strengthen people’s trust in financial institutions—it is fair to say that that has been somewhat shaken in previous years. Therefore, it is my firm belief that greater competition as a whole in the financial services industry will lead to greater innovation, and ultimately to better outcomes for customers.
We have put in place a huge range of programmes of reforms to support greater competition in banking. That includes putting competition at the heart of the regulatory system, with statutory competition objectives for both the Financial Conduct Authority and the Prudential Regulation Authority. Very importantly, we have created the new Payment Systems Regulator, which will come into its full powers on 1 April 2015.
The PSR has three statutory objectives: first, to promote effective competition in the markets for payment systems and for services provided by those systems; secondly, to promote the development of innovation in payment systems, in particular the infrastructure used to operate payment systems, in the interest of customers; and thirdly, to ensure that payment systems are operated and developed in a way that considers and promotes the interests of customers.
Coming back to the specific issue that the right hon. Lady raised on the cost of remittances, I am aware that my ministerial colleagues at the Department for International Development have been considering the cost of money remittances, and they have already taken action to reduce fees. That includes action to improve the transparency of fees by supporting the pioneering price comparison website sendmoneyhome.org to increase transparency around remittance transfer costs and to stimulate competition. The average cost of sending £100 has fallen by 5.6% across 11 countries and by 28% to India. The web platform has now become fully commercialised and has been replicated in France, Germany, Italy, the Netherlands, Australia and New Zealand.
DFID has been taking action to improve inter-market co-operation. Between 2009 and 2015, DFID will support the FinMark Trust in its drive to reduce the average cost of remittance transfers from South Africa to other Southern Africa Development Community countries by 30% by 2014.
Given the concerns rightly raised by the right hon. Lady today, I plan to write to my ministerial colleagues at DFID to ask that we work together to think about what more can be done and particularly to seek an update on the points she made about the Brisbane G20 discussions. However, as I have said, this is an extremely complicated issue. She is fully aware that in recent years we have seen growing concern among banks globally about money laundering and terrorism financing, and, of course, the very real possibility of potentially crippling enforcement action against banks that fail properly to protect against these risks. The money service business sector has been particularly affected, as she knows.
The right hon. Lady mentioned the actions taken by the hon. Member for Bethnal Green and Bow (Rushanara Ali), and my hon. Friend the Member for Ealing Central and Acton (Angie Bray) and many other colleagues have also brought this issue to the attention of the House on a number of occasions.
I know that the right hon. Lady is also aware of the action group on cross-border remittances, which was set up at the start of 2014 to seek to address this worrying trend towards debanking the money service business sector. The action group is composed of Government representatives, banks, money transfer operators and industry associations. It has initiated a number of important activities to revise guidance on compliance with the money laundering regulations; to improve the understanding of money laundering and terrorism financing risks; importantly, to sustain the flow of remittances from the UK through formal channels; and particularly, to improve trust in the remittance sector.
Our banks and regulators have a very real responsibility to ensure that they are not supporting activities that could pose a threat to British citizens and undermine the progress that developing countries are making. The right approach to tackling these threats should effectively deter, detect and deal with those who seek to use the financial system, including money remitters and banks, to launder money or fund terrorism. At the same time, it should protect and support legitimate businesses and, in particular, critical lifelines for countries such as Somalia.
In conclusion, as the Prime Minister set out earlier today, this is a very complicated area, but I would like to reassure the right hon. Lady that the Government are committed to doing what we can to keep remittances flowing and the costs down.
Greyhound Welfare
(10 years ago)
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Nadine Dorries (in the Chair)
Because the previous debate ended early, the final debate of the day may continue for up to 41 minutes, so we have until 5.23 pm.
Chris Evans (Islwyn) (Lab/Co-op)
It is always a pleasure to serve under your chairmanship, Ms Dorries.
Coming from a family of bookmakers, and having worked in the industry, I feel that I have been around horses and dogs all my life. Indeed, after setting up the betting shop with the race cards and newspapers, and after writing the “off slips” that signify the start of the races, my day would officially start with a piercing bell signifying that the 11 am greyhound race from Romford or Walthamstow was about to begin. Each Christmas, our work outing would be a night of dog racing just down the M4 at Swindon’s race track.
I make it clear that, when it is well regulated, greyhound racing can be a fun pastime. Even though it was a bit before my time, I can still remember the names of Ballyregan Bob and Scurlogue Champ from when the races were shown on that staple of Wednesday nights, “Sportsnight” on the BBC. Over the years I have known a few greyhound owners and trainers. In the main, they are dog lovers who treat their animals well.
Greyhound racing supports in excess of 7,000 jobs in the UK, and it is sustained by more than 4,000 owners. Additionally, the industry generates more than £55 million in taxation. However, there are two major problems with greyhound racing that are having a serious impact on the dogs themselves: prize money and welfare. The betting industry is inextricably linked with the sport of greyhound racing. As a betting product, greyhound racing has never been more popular. Some £2.5 billion is staked on the outcome of greyhound races each year. William Hill owns and operates two tracks, one at Sunderland and another at Newcastle. I welcome the fact that William Hill voluntarily pays more than £2 million to the British greyhound racing fund, which is an example that many betting companies making profits from the industry should follow. However, that is simply not the case with many online operators, including betting exchanges, which do not contribute a penny to the industry.
Whereas horse racing is subject to the Horserace Betting Levy Board, which collects a statutory levy from the horse racing business of bookmakers to be distributed for the improvement of horse racing and the breeds of horses, and for the advancement of veterinary science and education, greyhound racing could be termed a poor cousin. Greyhound racing has only a voluntary levy that is not enshrined in law and that sees a percentage of off-course betting turnover—currently 0.6%—returned to the sport. The levy amounts to approximately £12 million a year and is used to finance welfare and integrity work, the promotion of the sport and commercial activities.
Greyhound racing provides a core betting sport. Unlike horse racing, which is thriving, attendance at many greyhound tracks is dwindling. The independent Greyhound Board of Great Britain regulates the sport and maintains its integrity and well-being. I commend the board on its decision to ensure that all greyhounds are looked after, and microchipping the animals means that owners are always traceable. I have argued in the past that all dogs, regardless of breed, whether they are a working dog or a family pet, should be microchipped. In the summer my own dog went walkabout and would have been lost for good had I not microchipped him as a pup. To see the industry lead the way can only be a good thing.
However, low prize winnings put pressure on breeders, trainers and race tracks, who have to put on more races to make greyhound racing pay. More races mean more pups and more retired greyhounds that are sadly abandoned after their racing days are over. I again make it clear that it is no good tarring everyone with the same brush. In the main, trainers, dog owners and race track owners are people who love dogs and love greyhound racing, but a small minority are causing problems.
In 2004, a greyhound had to be put down when it was found in an extremely distressed state by a member of the public on a mountainside between Fochriw and Bargoed in the Rhymney valley—I do not represent those two villages, but I represent the lower part of Rhymney valley, which is in the Islwyn constituency. The dog had been shot with a nail gun and its ears, which were probably tattooed, had been cut off to stop identification. I have read that that is common practice in Ireland, although I appreciate that the Minister does not have jurisdiction there.
In 2010, the Department for Environment, Food and Rural Affairs adopted a system of self-regulation. When the system was instigated we were promised an end to the abuses of the past such as the one reported by The Sunday Times in 2006. The report found that, over 15 years, more than 10,000 healthy but unwanted greyhounds had been shot with a bolt gun and buried in a garden. That unofficial abattoir and graveyard was servicing licensed greyhound trainers. The practice was part and parcel of the greyhound racing industry. The chairman of the Greyhound Board of Great Britain admitted that it was “very plausible” for there to be similar operations that had not yet been uncovered.
Progress has been made, and I commend the efforts of the greyhound racing industry. However, according to the Society of Greyhound Veterinarians, the dimensions of the track and the all-weather conditions in which greyhounds are forced to race lead to high injury rates. Greyhounds suffer bone fractures, skin trauma, lacerations and a host of other problems, many requiring euthanasia. Most damning of all, each and every year, thousands of healthy greyhounds that could be re-homed and lead happy and long lives are needlessly and horribly put to sleep.
The all-party group on animal welfare estimates that a minimum of 4,728 racing greyhounds are unaccounted for each year—the majority are destroyed. The APGAW’s report states that the figure is
“likely to be a significant underestimation of the true scale of the problem of unwanted dogs being destroyed.”
We are now four years into self-regulation, and the racing industry’s problems are still prevalent, and it is not as if Ministers do not know. The APGAW, Lord Donoughue—who was commissioned by the industry—the Royal Society for the Prevention of Cruelty to Animals, Greyhound Rescue Wales and the League Against Cruel Sports have all shown time and again that some greyhounds lead a life of abuse, neglect and early death.
In a wide-ranging and comprehensive report, “The state of greyhound racing in Great Britain—a mandate for change”, the League Against Cruel Sports outlined how a new regulatory system might work. Such a system could improve the lives of greyhounds and make the sport fulfil its obligations to racing dogs. However, any new system must be based on evidence, transparency and the public interest. DEFRA’s five-year review of the statutory instrument must be open to the public. I invite the Minster to make that commitment. Once the full facts are in the open, action must be taken to ensure the welfare of greyhounds.
Ian Swales (Redcar) (LD)
The hon. Gentleman is making a powerful speech. Does he agree that more statistics are needed on the fate of greyhounds? Does he welcome the moves by charities to start doing that on a basis that the industry itself does not seem to want?
Chris Evans
Yes, I welcome those moves. It is worrying that so many greyhounds have gone missing. We must look at how their lives begin and end. When the greyhound was found on the side of a mountain in my part of the world, we could only conclude that his ears were cut of so he could not be identified. It was a terrible incident.
Once all the facts are in the open, there must be six changes. I would be grateful to hear the Minister’s thoughts on each of them. First, we must create an independent welfare regulatory body to oversee all greyhound racing—both licensed and independent—and it must include representatives from animal welfare organisations. Secondly, there must be full transparency. Those involved in greyhound racing must be required by law to disclose welfare information at the national and track level to the regulatory body each quarter. Thirdly, the use of substances such as testosterone and anabolic steroids on greyhounds must be prohibited. Fourthly, we must introduce greyhound passports so the welfare regulator is able to track every dog from birth, which will end the enigma of the thousands of greyhounds that go missing each year. Fifthly, there must be a statutory requirement on tracks, trainers and owners to re-home all racing greyhounds. Sixthly, we must introduce breeding controls, set up a licensing regime for British breeders and create joint initiatives with DEFRA and the devolved nations to tackle over-breeding.
Ministers could make those simple changes this side of the election if they wished. The Minister must tell us why the Government are allowing this sorry state of affairs to continue. The Government must step up to the plate, and I urge the Minister to do so today.
Although I believe that the betting industry has been unfairly criticised over the years, that does not stop me, as somebody who worked in it, being a critical friend. We should introduce a measure for greyhound racing similar to the horseracing levy. Those who make money out of racing should give something back, in much the same way as William Hill does. The levy should be statutory, rather than voluntary, otherwise the betting companies will simply not play ball. The choice is simple: either we have an independent welfare regulation system backed up by legislation and funded by a greyhound levy, or racing greyhounds will continue to face the horrible conditions that they do now. I look forward to hearing the Minister’s thoughts.
Ian Lavery (Wansbeck) (Lab)
I congratulate my hon. Friend the Member for Islwyn (Chris Evans) on securing this timely debate. As ever, it is a pleasure to serve under your chairmanship, Ms Dorries.
I am a greyhound owner. I love greyhounds, and I take great exception to people who know little about this wonderful sport classifying me as a “terrorist in sport” because I want to raise those wonderful animals. I co-chair the all-party group on greyhounds, and I have had lots of e-mails from people across Europe telling me that I am a bad individual for supporting this great sport.
Greyhound racing is widely watched and loved by millions of people—not just here in the UK, but across the globe. I really take exception to anybody who suggests that I do not look after my dogs. I have had hundreds of greyhounds: fast ones, slow ones, ones that have never made the track and ones that have reached five years of age. I have looked after every one of the animals I have had or been associated with from the day they came into my ownership to they day they sadly passed on.
The vast majority of owners do the responsible thing, but of course I accept that some people out there do not. Greyhound racing is a great sport, but it is tarnished by a secret few and a murky past. My hon. Friend the Member for Islwyn mentioned the event in Seaham a few years ago, when up to 10,000 dogs—most, but not all, were greyhounds—were found to have been killed by an individual. It brought tears to not only my eyes, but the eyes of anybody who has anything to do with the sport. It took the sport back 30 or 40 years—it was an outrage.
We have moved on since then. We have all heard the great tales of people stopping dogs running with pork pies and by putting elastic bands around their feet, and of people painting greyhounds to look like different dogs. If only a few of those tales were true, it would be half-amusing. People who try to besmirch this brilliant sport continue to perpetuate those myths because they are great tales to tell.
In the past, there were many instances of greyhounds, lurchers and other dogs of that type of breed being found on hillsides, like the dog that my hon. Friend spoke about. It is an outrage and brings tears to everybody’s eyes. Every time a single greyhound is left like that, it takes the sport back 10 years. We need to move forward.
Of course, there is a massive problem with welfare. The statistics show that. But we should not be looking to ban the sport, because it is a fantastic sport that is enjoyed by many people across the globe, from owners to spectators. We have 30 tracks or more in the UK. We have got to address the welfare problem, because every time there is a positive story about greyhound racing, such as the Towcester track, which opened two weeks ago—its official opening was on Saturday night, and it was a great event—it is tarnished by the welfare issue. We can take massive positive steps, but they are always tarnished by welfare. We should not turn our backs on the welfare issue because it is extremely important.
We need more transparency in the sport, as my hon. Friend suggested. Today, if somebody buys a greyhound, they get a passport with it. Every time the greyhound runs, its passport is marked. Since the Welfare of Racing Greyhounds Regulations 2010 and the Donoughue review, every greyhound is now microchipped, so there is a complete trail of ownership and the details of the individual greyhound are stored. Dogs are no longer allowed to run unless they are microchipped. That shining example of protecting welfare can be applied to all types of animal, but greyhound racing has been a leading light. Every track is now required to have a vet present during racing time.
Nadine Dorries (in the Chair)
Order. Mr Lavery, you have had more than six minutes. Another Member wishes to speak and the Minister must respond. Could you wind up?
Ian Lavery
Thank you very much, Ms Dorries. I thank the Minister and my hon. Friend the Member for Islwyn for allowing me to speak.
We must work with the trainers, the owners, the Greyhound Board of Great Britain, the Greyhound Trainers Association, the Dogs Trust and the Retired Greyhound Trust. Everybody must pull together to tackle the welfare issue and put greyhound racing on a firm footing for the future.
Andrew Rosindell (Romford) (Con)
It is a pleasure to serve under your chairmanship, Ms Dorries. I thank the hon. Member for Islwyn (Chris Evans) for giving us the opportunity to discuss this important issue. I also thank the hon. Member for Wansbeck (Ian Lavery), with whom I co-chair the all-party group on greyhounds.
I come from Romford, which is a greyhound racing town. There is a greyhound stadium in my constituency, where I have always lived. Therefore, for me it is very important that we get this issue right. We support greyhound racing, but as the hon. Members for Islwyn and for Wansbeck said, it is important that we uphold the welfare of the animals. I will focus on welfare in my brief remarks today.
The greyhound is, of course, a remarkable athlete. It is one of the oldest canine breeds; it is mentioned in the Bible, in Chaucer and in Shakespeare. Greyhounds have often been owned by members of the royal family.
In the UK, the greyhound industry is thriving, and it is an exciting industry. It not only brings in £55 million in taxation per annum but supports more than 7,000 jobs, which are linked to the 30 or so greyhound racing tracks around the country. Greyhound racing is a traditional British pastime and many people around the UK spend a lot of their life involved in it. It is very important that we do not take it away from them.
Let me state, as chairman of the all-party group on greyhounds, that whatever we feel about greyhound racing, the important thing is that we never forget about the welfare of the 8,000 dogs that enter and leave the sport every year. The sport itself must be supported, but only on the basis that the dogs are properly looked after during their racing days and when they finish racing.
I am pleased that much progress has made by the industry since the introduction of the Welfare of Racing Greyhounds Regulations 2010. The Greyhound Board of Great Britain has maintained the standards that afford it accreditation by the United Kingdom Accreditation Service. All racing greyhounds are microchipped and, under the GBGB rules of racing, owners are responsible for their greyhounds when the dogs’ racing days come to an end. In addition, the GBGB conducts a vigorous anti-doping regime, taking more than 9,000 samples a year. Of these, well over 99% are negative.
Charities such as the Retired Greyhound Trust, of which I am a trustee and a proud vice-president, serve to further the welfare of greyhounds when their racing days are over. The RGT is the largest single-breed re-homing charity in Britain and last year it found homes for 3,742 greyhounds. Unfortunately, the RGT and other charities are simply unable to help all the dogs that leave racing, and I welcome any assistance the sport is able to give these charities in that respect. The hon. Member for Islwyn emphasised the importance of that.
However, the recent report into greyhound racing in the UK by the League Against Cruel Sports has raised many concerns. While it is important for the sport to be held to account, it is my opinion that this report does not necessarily represent all the facts as they truly are, and in some cases it uses data that are simply not correct. For instance, the report claims:
“Most racing greyhounds spend 95% of their time confined in a kennel”,
when the truth is that they spend 95% of their time at a kennel, because quite simply that is where they reside and where they have access to paddocks, runs and walks on a daily basis. I do not believe that twisting the facts in that manner helps the debate and we should be careful not to take information at face value, rather than checking whether it is based on fact or just hearsay.
The GBGB is working with the Greyhound Forum to improve transparency on the information about injuries and trackside euthanasia rates, which means that this information is now available to many animal welfare organisations. However, I know that many of these organisations would like to see this transparency increased and for the GBGB to improve outside understanding of the injuries that greyhounds sustain and of the remedies that are used.
It is also regarded as important that the GBGB shares information about the number of greyhounds that retire each year, and about exactly where these dogs go. Perhaps that is one area where the industry could work more closely with the Greyhound Forum.
The greyhound industry and the GBGB are insistent on their commitment to the welfare of the animals with which they work. To retain the public’s support for greyhound racing, and the support of all those who care about the well-being of the animals, I strongly urge the industry and the GBGB to continue along the path of greater transparency.
The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (George Eustice)
I congratulate the hon. Member for Islwyn (Chris Evans) on raising this issue. I was interested to hear about his background in and experience of greyhounds, as well as the direct experience of greyhounds of the hon. Member for Wansbeck (Ian Lavery). I know that my hon. Friend the Member for Romford (Andrew Rosindell) has a long-standing record of championing animal welfare issues; he has clearly followed this issue particularly closely.
The treatment of racing greyhounds, both during and after their racing lives, is also a matter of concern for the public. This debate is very timely, because I will be able to say a few words about what the Government will be doing on greyhound racing during the coming months, and in particular about our plans to review the current regulations early next year.
Ian Swales
Earlier this year, I took my constituent Trudy Baker, who is a prominent member of the Greyt Exploitations charity, to see Lord De Mauley, who is a Minister. On 1 April, Lord De Mauley wrote to me promising the setting up of a review group to assess the 2010 regulations. Has that group been set up? If so, when will it report?
George Eustice
I was going to come on to say that the original legislation envisaged a review in 2015. Work towards that review has already begun with officials, and the intention—as I was going to say later on—is that we shall shortly have a discussion with stakeholders and those involved in greyhound racing, before going to a wider public consultation. I myself have had the opportunity to talk to Lord De Mauley, who leads on this particular issue in the Department for Environment, Food and Rural Affairs. I know that he has visited greyhound racetracks and has already met many stakeholders to discuss these particular issues.
I shall first set out the current legislative framework covering the welfare of greyhounds in England. This matter is, of course, a devolved one. However, it is a reality that the majority of greyhound tracks in Britain—some 30 out of 34 tracks—are in England. There are a further three tracks in Scotland and one in Wales. The majority of those 30 tracks in England—24 in total—are currently affiliated to the Greyhound Board of Great Britain. Following the 2007 report on greyhound racing that was led by Lord Donoughue, the GBGB has been the main governing body of the sport since January 2009. However, there are a further six tracks that are currently not affiliated to the GBGB: these are the so-called independent tracks, which tend to be smaller. They race independently of the GBGB.
Ian Lavery
Just to clarify that point, does the Minister mean that those independent tracks are not licensed by the GBGB, rather than “not affiliated to” it?
George Eustice
That is right. My understanding is that if tracks are affiliated to the GBGB, they are licensed by it. The independent tracks, which tend to be the smaller ones, are directly licensed by the relevant local authority.
Nevertheless, it is important to note that welfare standards for all racing greyhounds in England are covered by the Animal Welfare Act 2006 and the Welfare of Racing Greyhounds Regulations 2010. The 2006 Act is wide ranging, but it allows action to be taken where there is evidence of cruelty to an animal or of a failure to provide for an animal’s welfare needs. This includes, for instance, when greyhounds are kept away from the track, such as at a trainer’s kennels, which is often flagged as a point of concern by some animal welfare groups.
Further to the general provisions under the 2006 Act, which apply everywhere, the welfare standards at all greyhound racing tracks in England are specifically covered by the Welfare of Racing Greyhounds Regulations 2010. Introduced in April 2010, these regulations require that all tracks must do the following: first, they must have a vet present at all races, race trials and sales trials, with all greyhounds inspected by the vet before they are allowed to run; secondly, the tracks must provide suitable kennelling; thirdly, all greyhounds be microchipped and earmarked before they can race or trial; and finally, each track must keep records of all dogs that are raced or trialled at that track, and of any dogs injured during a race, trial or sales trial.
These standards are regulated either by the track’s local authority—that is the case for independent tracks, as I have pointed out—or, as in the majority of cases, by the GBGB, which regulates 24 tracks. However, the GBGB is only allowed to regulate these standards on the basis that it is accredited by the United Kingdom Accreditation Service for the audit of greyhound tracks against the standards required by the 2010 regulations.
At this point, it might help the House if I briefly discussed what we mean by the term “self-regulation”. The hon. Member for Islwyn said that this is still very much self-regulated. However, I do not think it is quite as simple as that, because the position is firmer than simply having a voluntary code.
Prior to the introduction of the regulations in 2010, the industry was self-regulated in the way that most people would understand the term. There were no specific statutory requirements for greyhound racing tracks, the industry set its own welfare rules of racing and there was no independent external scrutiny of how the National Greyhound Racing Club, which was the main industry regulator at the time, enforced its own rules. However, following the 2007 Donoughue report and the subsequent introduction of the Welfare of Racing Greyhounds Regulations 2010, the minimum conditions required for all greyhound tracks in England are now set down by Parliament. Apart from local authorities, if any organisation wishes to regulate the standards themselves, it must have UKAS accreditation to do so. The GBGB is currently the only body certified in this way by UKAS and ensures that there is now external independent oversight of the enforcement work that the GBGB carries out.
While the current situation is often described as self-regulation, clearly 2010 marked a break with what had gone before. What we have is a statutory form of regulation that is enforced by an industry body that is then itself audited by an independent body established within Government.
It might be worth while my saying a little more about UKAS accreditation. UKAS is recognised by the Government as the sole UK organisation for the accreditation of certification, testing and inspection bodies to internationally agreed standards. UKAS accreditation provides an assurance of the competence, impartiality and integrity of assessment bodies. As UKAS accredits the GBGB as a certification body, I think that the Government can have confidence that the GBGB is effectively monitoring and verifying welfare standards as defined within the rules of racing and within the 2010 regulations.
UKAS’s accreditation process determines the technical competence and integrity of organisations acting as assessment bodies. Before UKAS accredits any organisation, the organisation will be subject to intensive audit to ensure compliance with the international standard for certification bodies, including witnessing the organisation’s own assessment activities. Accredited organisations are subject to annual surveillance visits and full reassessment after four years.
Organisations found not to be acting in accordance with their accreditation can have that suspended or even withdrawn. Should the GBGB ever lose its accreditation, the 2010 regulations would automatically remove its powers to regulate the standards set out in those regulations, and all GBGB tracks in England would then require a licence from their local authority.
If anyone has any concerns about how the GBGB is applying welfare standards as defined within the rules of the 2010 regulations, they can report them to UKAS. UKAS has powers to investigate any such concerns reported to it. The GBGB was accredited by UKAS in March 2010 and DEFRA officials have been told that since then UKAS has received no complaints about the efficacy with which the GBGB has approached its duties.
I want to say a little about the five-year review, which was touched on in an intervention. When the regulations were introduced in 2010, Ministers in the last Government committed to reviewing them after they had been in force for five years. As the House is aware, all new regulations now come with statutory five-year review clauses anyway, but it was always the intention—even under the previous Government, and even before the statutory requirement to review regulations every five years was in place—to review these particular regulations after five years.
The review is due in April 2015, but work on it has already begun. We aim to go out to key stakeholders early in the new year, to collect the evidence that we need to assess the effectiveness of the regulations. Once we have independently collected and considered that evidence, DEFRA will go out to a wider public consultation, which will most likely commence after the election, given that we will quickly be at the end of March and into a purdah period.
Given the strength of views on these issues, it is important that we do not have a quick consultation that gets lost in the run-up to the general election. This is an important issue, and we do not need to rush it. Provided we have started the engagement with stakeholders before the general election, we should allow plenty of time for people to respond to a public consultation after it.
That review will consider how effective the regulations have been. It can look at the self-regulatory elements of the regulations and how the current approach adopted by the GBGB is working and at the requirement to collect injury statistics and how those can be used. It can also look at the traceability of greyhounds after they have left the sport, because one of the biggest concerns that is often raised about the current situation—the hon. Member for Islwyn highlighted this—is that nobody is sure where between 2,000 and 4,000 greyhounds a year, by some estimates, end up. We know that many excellent charities help to re-home greyhounds that have left racing, but there is concern about some of the others.
The hon. Member for Islwyn mentioned a number of issues that he would like to be addressed in that review, and I think that all of them could indeed be covered. For instance, he highlighted the importance of independent welfare oversight and asked whether other welfare charities could be involved, and I see no reason why that could not be explored through the review. It is exactly the kind of thing that we should do.
The hon. Gentleman also mentioned the importance of transparency on statistics. We know that the regulations now require the GBGB to require all its tracks to record instances of injuries. Many say that those injuries should be submitted to the GBGB and perhaps published, so that there is transparency in that regard. Again, these are all valid points that can be addressed through the review.
My hon. Friend the Member for Romford highlighted the issue of doping and the use of drugs. This is a good point. We should recognise that the use of doping and drugs in this context would already be a breach of the Gambling Act 2005, which, as my hon. Friend will know, given his background in this, sets out many provisions in this regard. We should also recognise that the GBGB has done some good work in this area. It has taken it quite seriously, spending more than £640,000 a year on drug sampling and research to ensure that it is able to detect substances, as my hon. Friend said.
Finally, the hon. Member for Islwyn mentioned over-breeding. This is an issue with many breeds—the greyhound is not the only example—and the Kennel Club has started to become alert to this problem and to do work on it, including the dangers and welfare impacts. I am sure that when we have that review, organisations like the Kennel Club and other animal welfare organisations, which have themselves done good work in this connection, may want to contribute to it.
In conclusion, we have had a good, well-informed debate with hon. Members who have a lot of experience of this issue. I am sure that many of the points that have been raised will be pertinent to the review that we are about to commence, first with stakeholders and then with the wider public during the next six months. I again congratulate the hon. Gentleman on securing this debate and hon. Members on their important contributions.
Question put and agreed to.
Written Statements
Science and Innovation
(10 years ago)
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The Minister for Universities, Science and Cities (Greg Clark)
I have today laid before Parliament a Command Paper “Our plan for growth: science and innovation”. The document sets out the Government’s strategy to build on the great strengths of British science and enterprise, the Government’s priorities for investment and support to 2020-21, and the key principles that will underpin science policy during the next 10 years and beyond.
Ministerial and Civil Service Pension
(10 years ago)
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The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
Today a new pension scheme for Ministers is being laid and is available in the Libraries of both Houses. The scheme will apply to all Ministers after the general election in 2015.
The scheme is consistent with the principles and design parameters of other new public service pension schemes which will apply to Members from April 2015—aside from older Members with transitional protection.
The key features of the scheme are:
An accrual rate of 1.775% (about 1/56)
Normal pension age linked to state pension age
A Member contribution rate of 11.1 %
Revaluation of accrued benefits in line with prices
There are also amendment schemes being laid for the current ministerial and civil service pension schemes to cover protection of survivor benefits.
The amendments do not make any provision in relation to an accrued right which puts—or might put—a person in a worse position than the person would have been in apart from the provision.
The details of the new scheme have been laid in the Libraries of both Houses, along with a copy of the response to the consultations from the chairman of the Parliamentary Contributory Pension Fund Trustees.
It is also available online at: http://www.parliament.uk/writtenstatements
Local Government Improvement: Technical Consultation
The Secretary of State for Communities and Local Government (Mr Eric Pickles)
I would like to update hon. Members on a series of steps we are taking to improve the quality of local government services and ensure value for taxpayers’ money.
London Borough of Tower Hamlets
On 4 November, I informed the House that I was satisfied, having considered the report of the inspection by PricewaterhouseCoopers LLP (PwC) of Tower Hamlets council, that that council is failing to comply with its best value duty, and proposed to statutorily intervene to secure the council’s compliance with that duty.
I gave the council until 18 November to make any representations it wished on the inspection report and my proposal for intervention, and I sought and received from the council certain undertakings not to take further specified actions on grant making, appointment of statutory officers, and transfer of property to third parties, until I had reached decisions about the use of my intervention powers.
I have now carefully considered all the representations that the council has made. I have also considered afresh the PwC inspection report and the report the Election Commission published on 1 July 2014 into the elections in Tower Hamlets, and I have had appropriate regard to other representations that I have received about my proposed intervention. I remain satisfied that the council is failing to comply with its best value duty. It is disappointing that there is a culture of denial in the mayoral administration about its systematic failures.
As I said in my previous statement, 4 November, Official Report, column 666:
“Localism requires local accountability and local democracy. Municipal corruption undermines the local checks and balances that are vital in a democracy and essential in mayoral systems with their concentration of power. We cannot risk such corruption.”
But this is not just about the money. The abuse of taxpayers’ money and the culture of cronyism reflects a partisan community politics that seeks to trade favours and spread division on the rates. Such behaviour is to the detriment of integration and community cohesion in Tower Hamlets and in our capital city. This remains my view.
I have concluded that it is both necessary and expedient for me to exercise my intervention powers in the Local Government Act 1999 as I have proposed, and accordingly, I have today given the council the necessary directions under section 15(5) and 15(6) of the 1999 Act to implement the proposed interventions.
These are centred on putting in place until 31 March 2017 a team of commissioners to oversee or exercise certain of the council’s functions. It is open to me to review this in the light of the progress made by the council to secure compliance with its best value duty. I have nominated Sir Ken Knight to be the lead commissioner. Max Caller CBE has also been nominated as a commissioner, and I will announce a further commissioner in due course.
In summary, the specific intervention measures are as follows.
1.To require the council:
to draw up and agree with the commissioners within three months from the date of the direction a strategy and action plan for securing the council’s compliance with its best value duty—to include as appropriate complying with the specific requirements set out below—and to submit this to the Secretary of State;.
to prepare under the direction of the commissioners and submit to the Secretary of State at six monthly intervals thereafter until 31 March 2017 a report on progress against the strategy and action plan;
to undertake as a matter of urgency a recruitment exercise, under the direction of the commissioners, with the aim of making as soon as practicable, permanent appointments of suitable persons to the positions of the three statutory officers—head of paid service, chief finance officer, and monitoring officer;
until 31 March 2017 to obtain the prior written agreement of the commissioners to (a) any dismissal or suspension of a statutory officer; and (b) any proposed appointment or designation of a replacement;
until March 2017 to obtain the prior written agreement of the commissioners before entering into any commitment to dispose of, or otherwise transfer, to third parties, any real property other than existing single dwellings for the purposes of residential occupation;
within three months from the date of the direction, to prepare a fully costed plan for how the council’s publicity functions can be properly exercised and agree that plan with the commissioners; and until 31 March 2017 adopt any recommendation of the commissioners with respect to that plan or to publicity more generally;
by 1 February 2015 to prepare and implement an action plan, in consultation with the commissioners, to achieve improvements in the council’s processes and practices for entering into contracts, and until 31 March 2017 to adopt all recommendations of the statutory officers in relation to the processes and practices to be followed in relation to entering into contracts, unless the commissioners’ prior written agreement is obtained not to do so.
2. The commissioners to exercise until 31 March 2017 all functions of the council relating to the making of grants, including responding to Freedom of Information Act requests in respect of grant payments, with the council providing at the request of the commissioners its views on proposed grants.
3. The commissioners to exercise until 31 March 2017 the council’s functions of appointing persons to and removing them from the posts of electoral registration officer and returning officer for local elections—this will also apply to their general election duties.
The council will be required to comply with any instructions of the commissioners in relation to the exercise of those functions for which the commissioners are responsible, and to provide the commissioners at its expense with such services, amenities and administrative support as the commissioners may reasonably require, and with access to the council’s premises, documents, and to any employee or member as appears to the commissioners to be necessary. The council will also be required to pay the commissioners’ reasonable expenses and such fees as I determine.
Intervention was not a decision taken lightly, however I could not allow the overwhelming evidence of the serious failings within Tower Hamlets to continue unchecked. I do not accept the Mayor’s representations that the problems in the council can easily be put right.
Residents need to know that decisions are being taken properly in an open and accountable way. The commissioners I am appointing are experienced and talented professionals who understand that transparency and accountability are vital to the functioning of local democracy.
Local government transparency
The coalition Government have taken many steps during this Parliament to place more power into citizens’ hands to increase democratic accountability and make it easier for local people to contribute to the local decision-making process and help shape public services. Transparency is the foundation of local accountability and the key that gives people the tools and information they need to play a bigger role in society.
In October, we issued the local government transparency code 2014 and have made it a legal requirement for local authorities to publish much of the data specified in the code. Today, we have taken another step forward in ensuring that local people have key information to hold public bodies to account by publishing a transparency code for smaller authorities.
Under the new local government audit regime smaller authorities will be subject to the transparency requirements laid out in this code in place of routine external audit. The code will require the online publication of information that provides taxpayers with a clear picture of authorities’ activities, spending and governance, improving the ability of communities to hold local public bodies to account.
The transparency code for smaller authorities applies to parish councils, internal drainage boards, charter trustees and port health authorities with an annual turnover not exceeding £25,000. Published initially as recommended practice, we intend, subject to Parliament, to make the code mandatory by the start of the 2015-16 financial year and will offer support to this local government sector to help authorities comply with these requirements.
Backing locally supported joint working
There are many ways that local authorities can work together to save money and improve services, but there is equally no one-size-fits-all model either. The Dorset fire authority and the Wiltshire and Swindon combined fire authority have formally made representations requesting a merger. We have today published a consultation paper on their proposals.
In contrast to the last Administration, we do not believe in top-down restructuring. Nor do we agree with the current proposals of the HM Opposition to force more mergers. The botched fire control programme is a prime example of how such restructuring is expensive and distracting. Rather, we will support locally led partnerships, where there is genuine support from all members of the local community, and the consultation will test this local support.
Improving support arrangements for local councils
It is important to have in place the most effective arrangements to help councils across the country to continue to improve and reform—essential if they are to deliver sensible savings.
Councils have a right to expect services designed to support them are the best they can be, provide the support they need and provide best value for money.
In 2015-16, we intend to provide grant of £23.4 million to the Local Government Improvement and Development (formerly IDeA) to deliver effective support to councils. This will be accompanied by robust scrutiny to ensure that every pound spent by it is spent appropriately and on providing direct support to councils. We expect of it the same standards and value for money as we expect of councils delivering front-line services, and we expect them to be transparent with councils about how they have spent the grant and the services they deliver to support councils.
The coalition Government’s policy is to open up budgets to competition wherever possible. We intend to explore how the budget given for improvement services can be opened up to competition with contracts in place for 2016-17, allowing councils, council groupings, think-tank, mutuals and other interested parties to bid for such funding, and drive further best practice in local government.
I am placing a copy of the documents associated with these announcements in the Library of the House and on my Department’s website.
Defence Reform: Review of Implementation
(10 years ago)
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The Secretary of State for Defence (Michael Fallon)
My noble Friend Lord Levene of Portsoken has conducted the third annual review of the implementation of his defence reform recommendations of 2011, and has written to me setting out his findings.
I welcome Lord Levene’s conclusion that he is impressed by the fundamental transformation the Ministry of Defence has undergone in the last four years. I am pleased that he recognises the significant progress we have made in many areas, not least the much stronger financial management he observed, which is such a key aspect of defence reform. Of course, I fully accept that there is always more we can do, and I have noted Lord Levene’s suggestions for further improvement.
I am grateful to Lord Levene for his commitment to the Ministry of Defence over the past four years and I am in no doubt that as a result my Department is now much better placed to achieve our objectives effectively and efficiently. We will continue in the spirit of defence reform to embed the changes we have put in place, and to build on them for the future.
I have asked Lord Levene to return next year, as he has offered to do, and I look forward to demonstrating further progress at that time.
I am placing a copy of Lord Levene’s letter in the Library of the House, together with the MOD’s summary of progress against the 53 defence reform recommendations.
School Revenue Funding 2015-16
(10 years ago)
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The Minister for Schools (Mr David Laws)
Today I am announcing details of school revenue funding for 2015-16 through the dedicated schools grant (DSG).
The distribution of the DSG to local authorities will continue to be set out in three spending blocks for each authority: an early years block, a schools block and a high needs block.
As I announced in my statement to the House on 17 July, the underlying school budget will be kept at flat cash per pupil for 2015-16 with an increase in schools block per pupil funding for the 69 least fairly funded local authorities.
To protect schools from significant budget reductions, we will continue with a minimum funding guarantee that ensures no school sees more than a 1.5% per pupil reduction in 2015-16 budgets—excluding sixth form funding—compared to 2014-15 and before the pupil premium is added.
Details of these arrangements are being sent to local authorities today and have been published at: http:// www.gov.uk.
Coal Authority Triennial Review
The Minister of State, Department of Energy and Climate Change (Matthew Hancock)
On 8 October 2013 as Minister for Energy and Climate Change, my right hon. Friend the Member for Sevenoaks (Michael Fallon) announced the commencement of the triennial review of the Coal Authority. I am now pleased to announce the completion of the review.
The Coal Authority was established under the 1994 Coal Industry Act with the broad responsibilities to protect the public and environment in coal mining areas and manage the effects of past coal mining. The authority owns the majority of coal in Great Britain, including past coal mines.
The triennial review of the Coal Authority concludes that the functions performed by the authority are still required and that it should be retained as a non-departmental public body. The review also looked at the governance arrangements for the authority in line with guidance on good corporate governance set out by the Cabinet Office. The report finds that good corporate governance arrangements are already in place, and makes a number of recommendations in this respect which we expect will be implemented shortly.
The full report of the review of the Coal Authority can be found on the Coal Authority website: www.gov.uk/government/organisations/the-coal-authority and copies have been placed in the Libraries of both Houses.
Mitochondrial Donation
(10 years ago)
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The Parliamentary Under-Secretary of State for Health (Jane Ellison)
We have today laid regulations to allow mitochondrial donation to prevent the transmission of serious mitochondrial disease from mother to child.
Mitochondrial disease is passed from mother to child through faults in the mitochondrial DNA. It is estimated that one in 6,500 children are born every year in the UK with a serious mitochondrial DNA disorder. Serious mitochondrial disease can have a profound effect on families, including the premature death of children; and causes painful, debilitating and disabling suffering, long-term ill health and low quality of life. There is no cure. British scientists are leading the world in the development of mitochondrial donation techniques which can prevent the transmission of this devastating disease.
The Government have run a comprehensive and transparent process over the lifetime of this Parliament to review the public acceptability of mitochondrial donation and the ongoing evidence of safety and efficacy of the new techniques involved. In developing the draft regulations, we have taken extensive advice from the scientific and research community and the United Kingdom’s regulator, the Human Fertilisation and Embryology Authority (HFEA). Should the regulations be approved by Parliament these mitochondrial donation techniques would form part of the HFEA’s regulatory framework. Any prospective provider would have to demonstrate that it could perform the technique both safely and effectively in order to obtain a licence, putting mitochondrial donation on the same footing as other fertility treatments.
The consultative process has included: a public dialogue and consultation about public acceptability run by the HFEA in 2012-13; three separate reports about the safety and efficacy of the techniques by an expert panel convened by the HFEA in 2011, 2013 and 2014; and a consultation by the Department of Health in 2014 about the detail of draft regulations that would allow these techniques. The HFEA published “Mitochondrial Donation: an introductory briefing” on 22 October, which provides a very helpful summary about the expert panel review process and outcome.
In addition the Nuffield Council on Bioethics ran a public consultation about the ethics of allowing the new techniques in 2012. Most recently, the House of Commons’ Science and Technology committee took evidence and considered the science of the new techniques, subsequently writing to the Government urging them to proceed.
Taking into account this cumulative consideration and consultation, the Government consider that the time is now right to give Parliament the opportunity to consider and vote on these regulations.
Nicotine-inhaling Products
(10 years ago)
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The Parliamentary Under-Secretary of State for Health (Jane Ellison)
The Government have today published “Age of Sale for Nicotine-inhaling Products-consultation on proposed regulations to be made under the Children and Families Act 2014”
In February 2014, the Government took regulation-making powers in the Children and Families Act 2014 to enable regulations to be made to prohibit the sale of nicotine products to persons under the age of 18. The proposed regulations cover “nicotine-inhaling devices” which are defined as any device which is intended to enable nicotine- to be inhaled through a mouthpiece but is not tobacco, cigarette papers or a device intended for the consumption of lit tobacco. It encompasses electronic cigarettes. The proposed regulations also cover refill cartridges and nicotine liquids intended to be used to refill nicotine inhaling devices.
The proposed regulations would:
make it an offence to sell nicotine-inhaling products, such as electronic cigarettes, to anyone under the age of 18, with certain limited exceptions;
extend the existing offence of the proxy purchase of tobacco (at section 91 of the Children and Families Act) to cover nicotine-inhaling products, so that it would also be an offence for an adult to buy an e-cigarette on behalf of a child under 18 years, subject to limited exceptions; and
exempt the sale of any nicotine-inhaling product that is licensed as a medicine, where it has been prescribed to a child and is sold under certain conditions, or where the medicine is indicated in its licence for therapeutic use by children.
The Government want to protect children and young people from addiction to any substance, particularly those that might be harmful to health. Given the rapid emergence of e-cigarettes in recent years, coupled with concerns about the increased awareness and use of these products by children, the Government are committed to setting an age of sale requirement.
The consultation on the draft regulations will run for six weeks until 28 January 2015. I encourage all those with an interest to submit their views on the draft regulations and the accompanying impact assessment.
A copy of “Age of Sale for Nicotine-inhaling Products—consultation on proposed regulations to be made under the Children and Families Act 2014” has been placed in the Library of the House and attachments can be viewed online at: http://www.parliament.uk/ writtenstatements
Smoking (Vehicles Carrying Children)
(10 years ago)
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The Parliamentary Under-Secretary of State for Health (Jane Ellison)
The Government have today published a response to the consultation on regulations to end smoking in private vehicles carrying children and have laid draft regulations in Parliament.
The Government want to protect young people from the serious health harms of smoked tobacco and the regulations would make private vehicles carrying children smoke-free. We have made some technical amendments in response to the consultation responses, and, subject to agreement in both Houses, they will come into force from 1 October 2015.
The existing smoke-free legislation, as set out in the Health Act 2006, will be extended so that it will be an offence to:
smoke in a private vehicle with someone under age 18 present; and
fail to prevent smoking in a private vehicle with someone under age 18 present.
If approved by Parliament, the regulations will apply to enclosed private vehicles and will not apply to anyone driving alone.
The World Health Organisation found that second-hand smoke is a real and substantial threat to child health. It causes a variety of adverse health effects including increased susceptibility to lower respiratory tract infections like pneumonia and bronchitis, worsening of asthma, middle ear disease, decreased lung function, and sudden infant death syndrome.
Smoke-free legislation is a devolved matter and these regulations would apply to England only. However the regulations will set the amount of the fixed penalty notice at £50 for the offence of failing to prevent smoking in a smoke-free private vehicle, which will apply in relation to England and Wales. We are liaising with the Welsh Government to co-ordinate our approaches. Public Health England is developing a social marketing campaign to raise awareness of the new regulations in advance of them coming into force.
The Government response to the consultation on smoking in private vehicles carrying children has been placed in the Library of the House.
Intercept Evidence
(10 years ago)
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The Minister for Security and Immigration (James Brokenshire)
The interception of communications plays a vital role in preventing terrorist attacks and tackling serious and organised crime. Interception is used in some form in the majority of MI5’s top priority counter-terrorism investigations. It plays a crucial role in the work of the police and the National Crime Agency to bring serious criminals to justice.
The prohibition on the disclosure of warranted intercept in court is a long-standing one. It has served to protect the most sensitive capabilities of the security and intelligence agencies. And it has set the context in which the current interception regime has evolved.
The Government are committed to securing the maximum number of convictions in terrorism and serious crime cases. The experience of other countries is that the use of evidence gathered through interception may help to achieve that. For that reason, the Government have sought to find a practical way to allow the use of intercept as evidence in criminal proceedings.
I am today publishing the findings of the Government’s review of intercept as evidence as a Command Paper (Cm 8989).
This review considered whether it would be possible to introduce intercept as evidence in a way that was consistent with the right to a fair trial. The costs of translation, transcription and retention in order to disclose material to the defence would be substantial, diverting considerable resources away from investigative work.
The review found that the benefits—measured in additional convictions—would be highly uncertain. On some assumptions, the use of intercept as evidence would lead to a small increase in convictions. On others it would lead to a significant decrease.
The review concluded that the costs and risks of introducing intercept as evidence are disproportionate to the assessed benefits. This conclusion was unanimously endorsed by the advisory group of Privy Counsellors who have overseen the review from its inception.
Based on the outcome of the cost-benefit analysis, the review concluded that intercept as evidence should not be introduced at this time. However, the Government will keep this position under review.
This review has benefited from the experience and advice of the advisory group of Privy Counsellors, chaired by the right hon. Sir John Chilcot and comprising my noble Friend the right hon. Lord Howard of Lympne, my right hon. Friend the Member for Berwick-upon-Tweed (Sir Alan Beith), and the right hon. Member for St Helens South and Whiston (Mr Woodward), who replaced the right hon. noble and learned Lord, Lord Archer of Sandwell. The Government are indebted to them for their hard work, which is now complete.
Copies of the review will be available in the Vote Office.
Police Grant Report England and Wales 2015-16
(10 years ago)
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The Minister for Policing, Criminal Justice and Victims (Mike Penning)
I have today placed in the Library my proposals for the aggregate amount of grant to local policing bodies in England and Wales for 2015-16, for the approval of the House. Copies will also be available in the Vote Office.
The Department for Communities and Local Government (DCLG) will in due course publish proposals for the distribution of funding to English local authorities for 2015-16. A further £3 million of council tax freeze grant funding, previously paid to local policing bodies by DCLG, will be paid by the Home Office in 2015-16. This follows the permanent transfer of £500 million of other legacy council tax grants and £3 billion “formula funding” from DCLG to the Home Office in previous years, reflecting our ambition to simplify police funding arrangements over this Parliament. The Welsh Government will shortly set out their proposals for the allocation of funding in 2015-16 for local policing bodies in Wales.
Since 2010 we have seen some of the biggest changes to policing in decades. Crime is down by over a fifth. There is significantly greater local accountability and transparency and police leaders have taken the opportunity to radically reform the way they deliver services to the public. Police officers have been taken out of back-office roles and resources focused on front-line delivery, putting officers back on the streets where the public expect them to be. Police forces are working more closely than ever before to reduce costs and duplication, and have started to work more closely with other emergency services through co-location and collaboration in areas such as mental health. The police are making their contribution to reducing the deficit and Her Majesty’s inspectorate of constabulary has found that the police are successfully meeting the challenge of balancing their books while protecting the front line and delivering reductions in crime.
After careful consideration of all Home Office budgets and the impact of the Chancellor’s 2013 autumn statement, I have decided to maintain the 4.9% real-terms headline reduction to overall central Government funding to the police announced at spending round 2013. Taking account of the latest inflationary forecast from HM Treasury published alongside the Chancellor’s 2014 autumn statement, this means a total cash reduction of £299 million in the overall police funding envelope compared to 2014-15.
I have also decided that the Government’s approach to funding arrangements will continue in 2015-16. This means that every police force area will face the same percentage reduction in core central Government funding. This amounts to a cash reduction in this funding of 5.1%—in cash terms—compared to 2014-15.
I have also decided to allocate funding to specific areas where I consider there to be a national policing interest. This includes maintaining police spending on counter-terrorism, improving police integrity, transparency and leadership, and enabling the investment required so the police can innovate to meet new challenges and access critical modern infrastructure by:
maintaining funding for counter-terrorism policing of at least £564 million;
providing a further £30 million for the Independent Police Complaints Commission;
supporting HMIC’s PEEL inspection programme with £9.4 million;
offering £4.6 million for the College of Policing’s direct entry schemes;
allocating £70 million of funding to the police innovation fund; and
providing £40 million of funding for major programmes.
I am also considering whether a limited amount of police capital grant will be reallocated to support the communications capabilities development and emergency services mobile communications (ESMCP) programmes. I will confirm my decision in the written ministerial statement that will accompany the final police grant report in February.
The police in England and Wales are facing many challenges, including new and emerging threats and a growing number of historic investigations. This Government have always been clear that the police will have the resources they need for their important work, and this will continue to be the case in 2015-16.
I have set out below how we propose to allocate the police funding settlement between the different funding streams and between police force areas for 2015-16.
The police grant settlement 2015-16
2015-16 | |
|---|---|
Total General Funding: | £m |
Comprising…. | |
Police Core Settlement | 4,309* |
of which Home Office Police Main Grant | 4,136 |
of which National and International, Capital City Grant (MOPAC only) | 174 |
Former DCLG funding | 2,851 |
of which formula funding | 2,818 |
of which Ordnance Survey | 2 |
of which Legacy Council Tax Freeze | 31 |
Welsh Government | 135 |
Total Home Office Specific Grants: | 822** |
Comprising…. | |
Welsh Top-up | 13 |
Counter Terrorism Police Grant | 564 |
Police Innovation Fund | 70 |
Police Knowledge Fund | 5 |
Independent Police Complaints Commission (for the transfer of integrity functions) | 30 |
College of Policing (for direct entry schemes) | 5 |
City of London National and International Capital City Grant | 3 |
HMIC (for PEEL inspection regime) | 9 |
Police Special Grant | 15 |
Major Programmes | 40 |
Legacy Council Tax Freeze Grants | |
of which Council Tax 2011-12 freeze grant | 59 |
of which Council Tax 2013-14 freeze grant | 7 |
of which Council Tax 2014-15 freeze grant | 3 |
Police Private Finance Initiatives | 73 |
Total Government Funding*** | 8,190 |
% cash change in Total Government Funding**** | -3.5% |
% real change in total Government funding | -4.9% |
* **Rounded to the nearest £m ***The police will also separately receive £434.4 million in local council tax support grant. This will be paid by the Home Office. ***This is the difference in total central Government funding to the police compared to 2014-15. The reduction in core Government funding (i.e. funding that is subject to damping) is 5.1%. |
Provisional allocations of these grants—excluding counter-terrorism police grant—for each force area in England and Wales for 2015-16 are set out in table 3.
Counter-terrorism
I will continue to allocate specific funding for counter-terrorism policing and have provided ring-fenced funding for this throughout the 2010 spending review period to ensure that critical national counter-terrorism capabilities are maintained. We have allocated at least £564 million to support counter-terrorism policing in 2015-16.
Police and crime commissioners will receive full counter-terrorism funding allocations in the new year. For security reasons these allocations will not be available in the public domain.
Pre-existing funding streams
Police innovation fund
I will continue to promote innovation, collaboration and improved efficiency by allocating £70 million to the police innovation fund for 2015-16. In its first two years, this fund has supported a broad spectrum of activity, including projects to enhance collaboration across the emergency services and with other public services; improve digital working within and between forces; and introduce new means by which the public can make contact with their forces. We have also decided to allocate £5 million to the establishment of a police knowledge fund. Further details will be provided in due course.
Independent Police Complaints Commission (IPCC)
This is the second year of funding for the expansion of the IPCC to investigate all serious and sensitive allegations involving the police. In 2014-15 the IPCC has expanded its infrastructure, including doubling its numbers of investigations staff, and is on course to start almost twice the number of cases compared to last year. In 2015-16 I am providing £30 million from the police settlement which will allow the IPCC to focus on delivering significantly more independent investigations as the new investigations staff take up post. I will also provide £4.5 million from the wider Home Office budget to cover capital investment costs.
Her Majesty’s Inspectorate of Constabulary (HMIC)
We will provide £9.4 million to HMIC to continue its programme of thematic inspections and more wide-ranging PEEL inspections. The PEEL assessments represent a radical shift in how police forces are held to account by enabling the public to see for the first time how well their force is performing when it comes to cutting crime, providing a service that is fair and providing value for money. They give the public a clear, independent view of the quality of policing in their local area.
College of Policing
£4.6 million will be given to the College of Policing to attract, select and train exceptional people who have the potential to become senior leaders in policing. This will widen the talent pool from which police leaders can be drawn, open up police culture to new influences and foster an environment where challenge and innovation are welcome.
National and international capital city grant
This year, we will provide £2.8 million of funding to the City of London police in respect of their responsibilities for policing the capital. This follows an HMIC review of their detailed business case.
New funding streams
Major programmes
After consideration, we have decided to provide £40 million from the police settlement to support the continuing development of the emergency services mobile communications programme, Home Office biometrics and the national police data programme. These major programmes are critical for the police as they will ensure future communications and data capability, and are designed to deliver significant savings in the future.
Police special grant
We have decided to provide £15 million from the police settlement for the police special grant contingency fund, which supports police forces facing unplanned or unexpected additional pressures which might otherwise place them at financial risk.
Other funding
Council tax referendum principles
The Communities Secretary, in consultation with the Home Secretary, will in due course give an indication of the council tax referendum principles he is minded to propose for local authorities in England in 2015-16. After considering any representations, he will set out the final principles in a report to the House and seek approval for these in parallel with the final local government finance report. Council tax in Wales is the responsibility of Welsh Ministers.
Legacy council tax grants
In 2015-16 we will provide council tax freeze grant to police and crime commissioners in England relating to the 2014-15 council tax freeze scheme. We will continue to provide council tax freeze grant relating to the 2011-12 and 2013-14 schemes and local council tax support (LCTS) funding previously paid to police and crime commissioners in England by DCLG. This will total £503 million in 2015-16. The Common Council of the City of London and the Greater London Authority—on behalf of the Mayor’s Office for Policing and Crime—will also receive council tax freeze grant relating to the 2011-12 freeze grant scheme. The Greater London Authority will also receive an amount for the 2013-14 and 2014-15 schemes. These sums will continue to be paid from outside of the police funding settlement by DCLG. This will also be the case for any future council tax freeze grants.
Police capital
As in previous years, a portion of capital will be reallocated in 2015-16 to fund the National Police Air Service. I will consider whether a further reallocation is required to support the communications capabilities development (CCD) and emergency services mobile communications (ESMCP) programmes. Indicative figures, excluding a reallocation for CCD, are set out in table 2.
I still intend to allocate the majority of capital funding directly to local policing bodies. Like last year all local policing bodies will receive the same percentage change in capital grant. I will also continue to maintain a capital contingency.
2015-16 Police Capital | £m |
|---|---|
Police Capital Grant | 109.5 |
Police Special Capital | 1 |
NPAS | 10.4 |
Total | 120.9 |
Local Policing Body | HO core (including Rule 1) | Welsh Top-up | Welsh Government | Ex-DCLG Formula Funding | Legacy Council Tax Grants (total from HO) |
|---|---|---|---|---|---|
£m | £m | ||||
Avon and Somerset | 105.6 | - | - | 56.8 | 14.7 |
Bedfordshire | 40.6 | - | - | 23.5 | 4.6 |
Cambridgeshire | 48.8 | - | - | 24.5 | 6.0 |
Cheshire | 61.8 | - | - | 45.0 | 8.3 |
City of London | 18.5 | - | - | 33.8 | 0.1 |
Cleveland | 46.4 | - | - | 38.8 | 7.7 |
Cumbria | 28.9 | - | - | 31.0 | 4.8 |
Derbyshire | 62.5 | - | - | 37.9 | 8.7 |
Devon and Cornwall | 103.3 | - | - | 63.5 | 15.5 |
Dorset | 41.5 | - | - | 17.4 | 7.3 |
Durham | 43.0 | - | - | 37.2 | 6.1 |
Dyfed-Powys | 31.4 | 6.1 | 12.8 | 0.0 | - |
Essex | 103.4 | - | - | 56.3 | 13.1 |
Gloucestershire | 34.6 | - | - | 19.6 | 5.6 |
Greater London Authority | 1,040.1 | - | - | 754.1 | 119.7 |
Greater Manchester | 227.9 | - | 182.4 | 24.5 | |
Gwent | 43.2 | - | 29.7 | 0.0 | - |
Hampshire | 120.7 | - | - | 63.5 | 12.9 |
Hertfordshire | 71.8 | - | - | 36.6 | 9.5 |
Humberside | 67.6 | - | - | 46.8 | 10.0 |
Kent | 106.9 | - | - | 67.0 | 13.3 |
Lancashire | 101.1 | - | - | 79.6 | 12.8 |
Leicestershire | 65.7 | - | - | 39.9 | 8.9 |
Lincolnshire | 38.6 | - | - | 20.4 | 6.8 |
Merseyside | 123.2 | - | - | 113.5 | 15.6 |
Norfolk | 50.5 | - | - | 28.9 | 9.3 |
North Wales | 45.4 | 6.5 | 21.3 | 0.0 | - |
North Yorkshire | 41.9 | - | - | 27.2 | 7.9 |
Northamptonshire | 43.4 | - | - | 24.3 | 6.6 |
Northumbria | 110.8 | - | - | 108.0 | 8.2 |
Nottinghamshire | 78.4 | - | - | 48.4 | 9.7 |
South Wales | 89.3 | - | 71.2 | 0.0 | - |
South Yorkshire | 101.2 | - | - | 77.9 | 10.9 |
Staffordshire | 66.9 | - | - | 40.2 | 11.3 |
Suffolk | 41.0 | - | - | 23.0 | 6.8 |
Surrey | 62.5 | - | - | 29.4 | 9.2 |
Sussex | 98.4 | - | - | 54.2 | 13.2 |
Thames Valley | 142.0 | - | - | 74.3 | 15.3 |
Warwickshire | 31.2 | - | - | 17.5 | 5.2 |
West Mercia | 66.7 | - | - | 43.6 | 12.0 |
West Midlands | 252.3 | - | - | 181.3 | 19.0 |
West Yorkshire | 172.5 | - | - | 130.1 | 16.7 |
Wiltshire | 37.7 | - | - | 20.8 | 5.2 |
Total England & Wales | 4,309.2 | 12.5 | 135.0 | 2,818.3 | 503.2 |
Scientific Procedures on Living Animals
(10 years ago)
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The Minister for Crime Prevention (Lynne Featherstone)
The “Code of Practice for the Housing and Care of Animals Bred, Supplied or Used for Scientific Purposes”, is being laid before the House today. Copies will be available in the Vote Office.
The code of practice is intended to be a reference document that contains standards and advice for housing and care of protected animals bred, supplied and used for scientific purposes. Its purpose is to ensure that the design, construction and function of the installations and equipment of licensed establishments—along with their staffing, care and practices—allow procedures to be carried out as effectively as possible. The code of practice will also help establishments fulfil their responsibility to continually seek to improve their standards of care and accommodation in line with the principles of the 3Rs (replacement, reduction and refinement in animal use), striving to adopt higher standards where practicable and applicable.
The Secretary of State is required to,
“issue codes of practice as to the care of protected animals”
under section 21(2) of the Animals (Scientific Procedures) Act 1986 Amendment Regulations 2012 (SI 2012/3039) (ASPA). The publication of the code of practice also completes the transposition of the European directive 2010/63/EU, which sets out revised measures for the protection of animals used for scientific purpose. As part of that transposition, from 1 January 2013, we harmonised standards with other EU member states where required and, where appropriate, maintained our higher standards while avoiding unnecessary bureaucracy and cost burden.
The code of practice seeks to promote a shared understanding between establishments and Home Office inspectors of the manner in which the mandated requirements might be met. Scientific advances in knowledge and new technologies present significant opportunities to replace animal use, reduce the use of animals, and, where animal use is unavoidable, to refine the procedures, including the care and accommodation involved so as to minimise suffering (3Rs). Consequently, the code is drafted so as to assist establishments to meet these requirements, as well as encourage the application of up- to-date evidence-based 3Rs approaches to accommodation and care.
The key outcomes driven by this code of practice are:
to promote good animal welfare through the provision of consistent, high-quality care and accommodation;
to support the generation of high-quality, reliable scientific results through the reduction of environmental variables;
to implement the principles of the 3Rs through using the minimum number of animals and causing the minimum degree of pain, suffering, distress or lasting harm.
Publication of this code of practice helps the Government fulfil their commitment to implementing the 3R’s and of good regulation. It will maintain the UK’s position as an international leader in standards of practice.
The Secretary of State may issue revised codes of practice from time to time and proposes to complete the first review of this code of practice in approximately five years’ time. The code of practice is available at www.gov.uk/government/publications
National Networks Policy Statement
(10 years ago)
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The Minister of State, Department for Transport (Mr John Hayes)
There is a critical need to improve the national networks to address road congestion and crowding on the railways, to facilitate safe and reliable journeys, and to provide a transport network that is capable of stimulating and supporting economic growth. There is also an equally important need to ensure improvements have minimal impact on the environment, are well designed and improve safety.
The national networks national policy statement (NPS) sets the policy against which the Secretary of State for Transport will make decisions on applications for development consent for nationally significant infrastructure projects on the road and rail networks and strategic rail freight interchanges. The statement is based on existing Government policy and only applies to England.
Parliament has already played a valuable role in scrutinising the national networks NPS. I would like to thank the Transport Select Committee for its report, all those who contributed to the debate in another place, and those who also undertook important scrutiny work on the earlier drafts.
I am today taking the opportunity to lay before you the NPS for national networks in England pursuant to section 9(8) and 5(4) of the Planning Act 2008, and the Government’s response to the public consultation on the draft national networks NPS, which commenced in December 2013 for a period of 12 weeks.
Copies of all documents have been made available in the Libraries of both Houses and I am also publishing these documents on the Department’s website, with an updated version of the appraisal of sustainability, a post-adoption statement and other supporting documents.
Automatic Enrolment Thresholds
(10 years ago)
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The Minister for Pensions (Steve Webb)
I am today announcing the proposed automatic enrolment thresholds for next year. We intend to lay an order before Parliament in the new year which will include the following:
£5,824 for the lower limit of the qualifying earnings band;
£42,385 for the upper limit of the qualifying earnings band.
The automatic enrolment earnings trigger will be frozen at £10,000.
I am also publishing the Government’s response to the public consultation on the automatic enrolment earnings thresholds review later today on the gov.uk website. I attach a copy of the Government’s response to the public consultation on the automatic enrolment earnings thresholds review to this statement.
Attachments can be viewed online at: http:// www.parliament.uk/writtenstatements
Child Maintenance and Other Payments Act 2008
(10 years ago)
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The Minister for Pensions (Steve Webb)
Today, I, along with my hon. Friend the Minister for Disabled People (Mark Harper MP) and my noble Friend the Parliamentary Under-Secretary of State (Lord Freud), are publishing the Command Paper Cm 8986 “Child Maintenance and Other Payments Act 2008 Post-legislative Scrutiny Memorandum to the Work and Pensions Select Committee”.
The 2008 Act comprises a range of provisions including those which provided for the establishment of the Child Maintenance and Enforcement Commission (“C-MEC”), a non-departmental public body, which has since been abolished. In addition, it contains the provisions underpinning the new calculation measures for the 2012 child maintenance scheme and provisions for closing and transferring cases from the older child maintenance schemes, currently operated by the Child Support Agency: a process which began in June of this year. It also contains a range of debt management, collection and enforcement powers for the statutory child maintenance schemes, and provision to provide compensation payments for sufferers of mesothelioma or their dependants, where the sufferer has died before making a claim under the Act.
As many of the child maintenance powers have only commenced in the past two to three years, and because the Secretary of State has committed to undertaking a wider review of child maintenance reforms, this memorandum provides information on the set up of C-MEC and how its functions are now carried out, how the 2008 Act’s provisions fit with wider coalition Government policy and when a more detailed assessment of child maintenance reforms will be available. The evaluation strategy, which sets out our plans for assessing the impacts of the reforms, will be published shortly.
The 2008 Act provisions relating to mesothelioma lump sum compensation scheme payments came into force on 1 October 2008. We are therefore able to publish today, information about the implementation and take-up of the scheme since the scheme’s introduction.
Personal Independence Payments
(10 years ago)
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The Minister for Disabled People (Mr Mark Harper)
The Government are pleased to announce that the first independent review of the personal independence payment (PIP) assessment, carried out by Paul Gray, will be published later today. This is the first of two independent reviews as required by the Welfare Reform Act 2012.
Paul Gray has explored how the PIP assessment is operating from the perspectives of claimants, health professionals and other staff involved in delivery and has made a number of recommendations designed to improve the claimant experience. He has concluded that it is too early to draw definitive conclusions about the overall effectiveness of the PIP assessment based on available published data and has made recommendations to help the Department ensure the fairness and consistency of award outcomes in the future.
The Government welcome the review and will publish a detailed response in due course.