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Oral Answers to Questions
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Mrs Sharon Hodgson (Washington and Sunderland West) (Lab)
1. Whether he plans to make further changes in the level of funding for legal aid; and if he will make a statement.
The Lord Chancellor and Secretary of State for Justice (Chris Grayling)
Legal aid is a fundamental part of our justice system, but resources are not limitless. When reform began, we had one of the most expensive legal aid systems in the world, at about £2 billion a year. Even after our reforms are complete, our legal aid system will still be one of the most generous, at about £1.5 billion a year. The Transforming Legal Aid programme that is currently being implemented is designed to save an extra £215 million per year. There are no current plans for further changes to funding levels beyond this programme, but the financial pressure to balance the books remains.
Mrs Hodgson
Research by Rights of Women has revealed that six out of 10 women who suffered domestic violence and were then refused legal aid took no further action through the courts, and many, as a result, ended up staying in violent and abusive relationships. Will the Lord Chancellor look again at the barriers to access to justice that his legislation has created?
Chris Grayling
There are two issues involved. Clearly, domestic violence is a criminal offence and it should be dealt with properly by the police. Although we made a number of difficult changes in the Legal Aid, Sentencing and Punishment of Offenders Act 2012, one of the groups we protected was women who needed to go to court after an incident of domestic violence, and that is the way it should be.
Mr James Gray (North Wiltshire) (Con)
I would be grateful if the Secretary of State updated the House on what representations about current levels of legal aid he has received from the Bar Council and other organisations representing barristers.
Chris Grayling
Not surprisingly, the Bar Council has argued very strongly for the status quo on legal aid. We have worked with it closely over the past 12 months, particularly in the work done by Sir Bill Jeffrey and, most recently, Lord Justice Leveson on how we can improve the process to reduce work load, at a time when we face big financial pressures, and create a system that is more efficient.
Ms Margaret Ritchie (South Down) (SDLP)
Does the Secretary of State not agree that reductions in funding for this service could prevent those within the sphere of family law from accessing justice, thus reducing the ability to challenge unreasonableness?
Chris Grayling
As a Government, we have had to take some difficult decisions about legal aid. It is certainly the case that there is less legal aid money available for family law cases than there was. I am afraid that is a natural consequence of the financial challenges that we have faced. It is interesting that no party in this House has pledged to reverse these changes.
Mr John Leech (Manchester, Withington) (LD)
What has been the cost in wasted court time, particularly in family proceedings where people have not been properly prepared for their proceedings, as a result of cuts to legal aid?
Chris Grayling
So far, there has been an increase in the number of litigants in person. Of course, we have always had litigants in person in our courts. We continue to monitor the situation closely. The Minister of State, my right hon. Friend the Member for Bermondsey and Old Southwark (Simon Hughes), is working hard to look at additional ways of smoothing the processes that people have available to represent themselves. None the less, progress in our courts has so far continued pretty well.
Mr Andy Slaughter (Hammersmith) (Lab)
The Secretary of State’s third attempt to introduce a new contract for criminal legal aid is now stalled in the High Court and looks dead. Will he join the shadow Lord Chancellor, my right hon. Friend the Member for Tooting (Sadiq Khan), in burying it? Will he work with the legal profession to devise a model that does not put hundreds of high street solicitors’ firms out of business and lead to more miscarriages of justice? Or is this just like prisons, probation and the Courts Service—another of the policy car crashes he is leaving to an incoming Labour Government to sort out?
Chris Grayling
The one thing we can always guarantee at these sessions is to hear a load of nonsense from the hon. Gentleman. I have listened carefully to Labour Members’ arguments over the past few months. They oppose when it is politically convenient to do so, but they have absolutely no idea what they would do in our place—and that is why the electorate are not going to give them the chance.
Mr Graham Allen (Nottingham North) (Lab)
2. What assessment he has made of the potential effect of the Rebalancing the Outer Estates Foundation in Nottingham North constituency on reoffending rates among young people not in education, employment or training.
The Parliamentary Under-Secretary of State for Justice (Andrew Selous)
I very much welcome the hon. Gentleman’s commitment to improving education, skills, training and employment for his constituents. He has a long record of working in early intervention projects—an area that I am personally very committed to.
Mr Allen
I refer Members to my entry in the Register of Members’ Financial Interests.
Does the Minister agree with the old cliché that the best crime prevention measure is a job for young people? Will he commend the work of the rebalancing foundation in Nottingham North and visit it in order to see a number of the schemes that we have undertaken, including building—or hoping to build—a special college for 14 to 17-year-olds who are not in education, employment or training?
Andrew Selous
The evidence backs up what the hon. Gentleman says: only 32% of adults said they were in paid employment in the four weeks prior to custody, so the hon. Gentleman’s question is along the right lines. The evidence also tells us that more than a third of young people who go to prison in Nottingham reoffend. That is why we are putting education and skills at the heart of our transforming youth custody programme. The Government have also given £100,000 from the local enterprise partnership to the project in the hon. Gentleman’s constituency.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
3. What recent estimate he has made of the number of people on bail without charge.
The Minister for Policing, Criminal Justice and Victims (Mike Penning)
I am lucky enough to be the police Minister in the Home Office as well as a Justice Minister, and this question falls under both portfolios. We do not hold those data centrally, but we are now gathering them because of the review of pre-charge bail announced by the Home Secretary.
Mr Sheerman
Some of the answers I am getting from the Department do not include National Crime Agency figures. That is an omission. Does the Minister agree that for someone to be arrested and bailed without charge for months and months, such that their careers and lives are destroyed, goes against all the principles of British justice? Will he look at what Operation Pallial and the National Crime Agency are up to and at whether they are leaking private information to the media?
Mike Penning
If there is any evidence of leaking to the media, I am sure the hon. Gentleman will pass it to me in due course. I agree that we need to make sure that bail is used correctly, and that is exactly why the Home Secretary announced a consultation, which is ongoing. I am sure the hon. Gentleman will give evidence to it so that we can get it right. People should not be on bail for any longer than they need to be.
Mr Christopher Chope (Christchurch) (Con)
Will my right hon. Friend advise people who are in that position that bail is voluntary, so they do not have to accept it? If they do not accept bail, the police will either have to charge or release them.
Mike Penning
My hon. Friend is absolutely right, but someone who is arrested and offered bail when an investigation is ongoing faces a really difficult decision. We have indicated that the period should be no more than 28 days, and the consultation is looking at whether that is viable. The period may need to be longer in exceptional circumstances, particularly when the police are looking at encrypted hard drives, but at the end of the day it is for the individual and the police to decide.
Mr David Nuttall (Bury North) (Con)
4. What discussions he has had with his ministerial colleagues and the claims management regulator on tackling nuisance phone calls.
The Minister of State, Ministry of Justice (Simon Hughes)
Tackling nuisance calls is a priority for the coalition and I welcome my hon. Friend’s interest in the subject. We are working closely with colleagues in the Department for Culture, Media and Sport to reduce the irritation and distress they cause. Our Department’s claims management regulator has worked with industry and consumer groups as part of the nuisance calls taskforce. It published some recommendations on 8 December, which we believe will help reduce unwanted calls and texts, and we are actively considering which we can soonest implement.
Mr Nuttall
One of those recommendations is that the Government should introduce new legislation to hold to account directors of companies that blatantly flout the law on making nuisance telephone calls. What progress has the Minister made on implementing that particular recommendation?
Simon Hughes
There are three specific issues on the table. The first is what we did in December, which allows for new, tough financial penalties on companies—by which I mean companies as a whole—that break the rules. The second is the proposal that we have consulted on and are about to respond to, which would lower the threshold at which enforcement action can be taken and produce a fine of up to £500,000, which should be a deterrent. The issue of holding individual company members to account is more complex and will not be the first of the two things we do.
Mike Crockart (Edinburgh West) (LD)
The claims management regulator is often held up as the model for how to limit the number of nuisance calls due to the way in which the number of payment protection insurance call numbers has been reduced. However, recent discussions I have had with the Association of British Insurers indicate that it may not be working quite as planned. Will the Minister commit to a meeting as soon as possible to review whether the process is working as well as possible?
Simon Hughes
I recognise my hon. Friend’s assiduous work on this issue and I am very happy to pick up on the issue that the claims management regulation unit may not be as effective in practice as we believe it is in theory. We are determined to protect the public. Nuisance phone calls and nuisance texts, particularly to the vulnerable, are unacceptable. They must be dealt with and we will do that with my hon. Friend’s help.
Steve Rotheram (Liverpool, Walton) (Lab)
5. What steps he is taking to improve security and prisoner and staff safety at HMP Altcourse.
The Parliamentary Under-Secretary of State for Justice (Andrew Selous)
The National Offender Management Service is working very closely with the contractor in a number of areas to address those extremely important issues.
Steve Rotheram
I visited the jail myself recently and there have been some welcome improvements since the action plan, but, given the damning report by Her Majesty’s inspectorate of prisons, can the Minister assure my constituents that the prison is not only safe, but fit for purpose?
Andrew Selous
The Government take this issue extremely seriously, and the Secretary of State was at that prison on Friday. We are taking five actions. First, a new director has been appointed. He was formerly director of Her Majesty’s Prison Rye Hill, and he took up his position on 8 December. There is a new head of security and a new security intelligence manager, and new search and security systems are in place. Two full lock-down searches of the prison were conducted in November and December, and improvements have been made in the operation of the basic regime, which will help with the issues that the hon. Gentleman quite properly raises.
Stephen Mosley (City of Chester) (Con)
25. As well as taking prisoners from Merseyside, HMP Altcourse takes prisoners from Cheshire and north Wales. What will be the impact of the new super-prison at Wrexham on prisoner capacity in Cheshire, north Wales and Merseyside? [Official Report, 25 February 2015, Vol. 593, c. 3-4MC.]
Andrew Selous
We need more adult male capacity so we are taking the right course of action by building the new prison in north Wales. There are currently no prisons in north Wales, and the new prison will enable us to house all Welsh prisoners within Wales, which we have not been able to do before. We will keep prisoners as close to their home areas as far as possible.
Bridget Phillipson (Houghton and Sunderland South) (Lab)
6. What plans he has for the future of the youth justice system.
The Parliamentary Under-Secretary of State for Justice (Andrew Selous)
The Government are committed to preventing offending by young people. We are working to place education at the heart of youth custody, and will open the first secure college pathfinder in 2017. We have announced the commencement of our stocktake of youth offending teams, to give us a better understanding of how local youth justice services are delivered and to help ensure that we provide the best support possible to young offenders and their communities.
Bridget Phillipson
Will the Minister acknowledge the serious concerns that have been raised about the Government’s secure college proposals, and act on the advice of the chair of the Youth Justice Board and find alternative provision for girls and the youngest offenders?
Andrew Selous
As the hon. Lady knows, we will not be placing girls and young people under the age of 15 in the secure college when it starts, and those issues will be subject to a vote of both Houses of Parliament. At the moment we spend an average of £100,000 a year to keep a young person in custody, and we have a reoffending rate of 68%. We need to try something better, and putting education and skills at the heart of youth justice so that we turn young people into productive members of their community is the right way to go.
Guy Opperman (Hexham) (Con)
What plans does the Ministry of Justice have for alternative custody in the form of a secure residential drug treatment centre for young persons and adults? That could be piloted as an alternative for the future so that we can have better treatment in the longer term.
Andrew Selous
My hon. Friend is right to mention drugs in prisons as that issue is of great concern to the Ministry of Justice, not least because of new psychoactive substances that are getting into prisons. Our existing prisons have drug treatment programmes, and we are considering how we can continually improve and make that work more effective.
Meg Munn (Sheffield, Heeley) (Lab/Co-op)
The Minister will know that many young people who become involved in offending have themselves been victims of crime—perhaps crimes that they have not disclosed such as sexual abuse. When did he last meet the children’s Minister, the Under-Secretary of State for Education (Mr Timpson), to discuss that issue and consider how we can ensure that those young people, as victims, get the help that they deserve?
Andrew Selous
I reassure the hon. Lady that I am working closely with the children’s Minister and I have met him on a number of occasions, most recently last week. We are working closely together to address the issues that she has quite properly raised.
Dan Jarvis (Barnsley Central) (Lab)
Not a single independent expert thinks that the future of our youth justice system should involve wasting £85 million on a flawed plan for a secure college, and Labour Members will not go ahead with that proposal. Will the Minister guarantee that the secure college contract will not be signed before the general election, so that we avoid saddling the taxpayer with a huge bill for an expensive, unnecessary prison?
Andrew Selous
The hon. Gentleman is not totally correct because the Youth Justice Board is a strong proponent of the secure college. Let me say what I said to the hon. Member for Houghton and Sunderland South (Bridget Phillipson) a moment ago: it is not as if what we are doing at the moment is a roaring success. We spend enormous amounts of public money to get very poor results, and it is right to look at education and skills. The matter has been considered in Parliament, as he knows, and we are on plan to sign contracts later this month.
Justin Tomlinson (North Swindon) (Con)
7. What steps he is taking to break the cycle of reoffending.
The Lord Chancellor and Secretary of State for Justice (Chris Grayling)
I am pleased to inform the House that we have now completed our work and opened up the market for breaking the cycle of reoffending to a diverse range of new rehabilitation providers to get the best out of the public, private and voluntary sectors, and that we have commenced the provisions of the Offender Rehabilitation Act 2014.
Justin Tomlinson
What role does the Lord Chancellor see for mentoring in addressing reoffending for those who serve short sentences?
Chris Grayling
Mentoring is a crucial part of the future of our work to break the cycle of reoffending. I have absolutely no doubt that the ability of those who have been through the system themselves and turned their lives around, and who currently work within the voluntary sector, to play a role in changing the lives of those who are still in the criminal justice system is enormous. One thing that excites me is that, with the presence in the rehabilitation arena of a number of our leading charities working hand in hand with the Government and the private sector to deliver better rehabilitation, I am convinced we will see those mentoring skills brought to bear on the problem.
Mr David Hanson (Delyn) (Lab)
We have heard a lot about conflict of interest this week. Will the Secretary of State confirm whether he believes it is a conflict of interest that a private sector company can be paid £35,000 per place to keep somebody in prison in one region, and that the same private sector contractor can be paid £1,500 to keep someone out of prison? Is that not a conflict of interest?
Chris Grayling
We get a lot of nonsense from Opposition Members. I want a joined-up process, in which we work with people in prison, help them to prepare for release, and work with them when they have left prison. No organisation that works for the public sector in this arena chooses who it gets in its prisons or rehabilitation arena. It is right and proper that that responsibility lies with the public sector. I think a joined-up approach is the right way forward.
Andrew Bridgen (North West Leicestershire) (Con)
Does the Secretary of State agree that work in prison should lead to prisoners gaining skills that improve their employability, leading to reduced reoffending rates on release? Will he indicate to the House the number of prisoners partaking in work activity this year compared with 2010-11?
Chris Grayling
The number of hours worked in prisons has increased dramatically in the past four years—the latest figures show 14 million hours—and we are seeking to increase that number all the time. Last week, I was at HMP Coldingley for the launch of a new partnership between the Ministry of Defence and the Prison Service, whereby prisoners will produce items such as sandbags for use by our armed forces. I hope that that work will continue, grow and develop. The more we can get prisoners in our prisons working, the more likely they are to get a job when they leave.
Keith Vaz (Leicester East) (Lab)
As we heard earlier from the hon. Member for Hexham (Guy Opperman), drug addiction in the criminal justice system is a huge problem. There were 4,500 seizures of drugs in prisons last year. What further steps will be taken to deal with mandatory help in prisons and help for prisoners when they leave?
Chris Grayling
There are two parts to that equation. Although there has been considerable success over the years in tackling the problem of conventional drugs in prisons, the problem now is the arrival of new psychoactive substances that are not detected through the normal means. That has posed an additional challenge to our prison system, and is a significant reason behind the increase in the amount of violence—serious violence—in prisons in the past 12 months. We are taking additional measures to try to tackle that, including tougher security measures and tougher penalties within prisons, and the training of dogs to sniff out that new generation of substances.
Of course, alongside that, proper work must be done to try to tackle addiction. With the through-the-gate system we have created and are creating, it is important that we see a flow-through from work done in our prisons to work done after prison. I remember being told by prison staff how frustrated they were that they had no guarantee that the rehab being done in prisons would continue when prisoners left. That will now change.
Philip Davies (Shipley) (Con)
The cycle of reoffending is not helped by the number of people who are released on bail rather than remanded in custody. As the Daily Mail reports today, two rapes a week and one unlawful killing are committed by people on bail. [Interruption.] The hon. Member for Slough (Fiona Mactaggart) does not seem to care about the number of rapes committed by people on bail and is laughing about it. A previous parliamentary question I asked revealed that 20% of all burglaries are committed by people out on bail. What is the Secretary of State doing to ensure that more persistent offenders are remanded in custody and fewer persistent offenders are out on bail to commit more crimes?
Chris Grayling
Decisions on individual bail cases lie with the courts, which are independent of Government, but I never want the courts to be in a position where they do not have a place to send those whom they wish to put behind bars. I hope our courts will exercise extreme care in deciding whether to put somebody behind bars or to let them out on bail. As we go into the election in May, there are 3,000 more adult male prison places than there were in 2010.
Dr William McCrea (South Antrim) (DUP)
Will the Justice Secretary outline some of the additional educational opportunities that he believes would assist in preventing people from falling back into a life of crime?
Chris Grayling
We continue to work to expand education in our prisons, and I am pleased that this year we expect a significant increase in the number of prisoner qualifications. Great work is done by our education professionals in our prisons. We will look to expand and develop that as far as logistically possible.
Sadiq Khan (Tooting) (Lab)
The Justice Secretary was warned about the risks of the appointment of Paul McDowell as chief inspector of probation, but he arrogantly ignored them. Despite the clear conflict of interest, he defended his decision at the Dispatch Box when I raised the matter. He has shown a clear error of judgment. At a time when an independent inspector is needed the most, we do not have one. Will he confirm that the taxpayer will now be left with a further bill of £70,000 for his error of judgment, with the former chief inspector free to join one of the private companies that are now running probation?
Chris Grayling
I have to say that the right hon. Gentleman’s comments are an insult to a fine public servant, who has taken a brave decision this week. I am not of the view that someone should be denied the opportunity to apply for a job because of the possibility that in the future their wife’s company might win contracts and she might be promoted. I regard Paul McDowell as a fine public servant who has done a good job for this country. I hope he will return to a new post somewhere else supporting our public sector in the future, because he deserves it. He has done a very good job.
Julian Smith (Skipton and Ripon) (Con)
8. What steps he has taken to ensure local access to the justice system.
The Minister for Policing, Criminal Justice and Victims (Mike Penning)
We keep the courts estate under review to ensure it meets operational needs and our aim to improve effective delivery of the justice system across our country.
Julian Smith
Skipton magistrates court is key to providing local access to the justice system for one of the most rural parts of our country. Will the Minister confirm that he will do everything he can to ensure that that court is kept busy and stays open?
Mike Penning
As the Police Minister, I am sure some of my colleagues in the police force will be doing exactly that. I do not think there has been a better advocate for a constituency magistrates court than my hon. Friend. Every time he opens his mouth in conversation with me or my colleagues in the Tea Room, he talks about Skipton magistrates court. I would do exactly the same if I was in his position.
Ian Lucas (Wrexham) (Lab)
When I had a meeting about my local magistrates court merger with the Courts Service, the court clerk in charge of the decision was based in Llanelli. Does the Minister regard that as local justice?
Mike Penning
I honestly think that when we look at the courts estate we need to make sure it is fit for purpose around the country. Where someone is based is immaterial. What we need to do is ensure we make the right decisions.
Sir Alan Beith (Berwick-upon-Tweed) (LD)
Will my right hon. Friend take a critical look at the proposal on its way to his desk that there should be a single local justice area stretching from Berwick to Sunderland, which could lead to cases being transferred for administrative convenience to courts 70 miles away at great cost to witnesses and families?
Mike Penning
I will, naturally, look at any submission that comes across my desk. I am sure the Minister responsible will look at that very carefully when it arrives.
Mr Andrew Love (Edmonton) (Lab/Co-op)
How many courts, closed since May 2010, remain on the estate undisposed of? What is the cost to the taxpayer of this policy?
Mike Penning
I do not have the exact figures in front of me. I will write to the hon. Gentleman.
Valerie Vaz (Walsall South) (Lab)
9. What assessment he has made of the effect on women in prisons of the implementation of the incentives and earned privileges scheme.
The Minister of State, Ministry of Justice (Simon Hughes)
We have some excellent women’s prisons led by excellent governors. The impact of coalition policies on women is always considered carefully by Ministers. I am committed to ensuring that that is done for women in prison, for which I have a particular responsibility. There was an equality impact assessment for the incentives and earned privileges policy, which came into effect in November 2013. Since then, we have subsequently continued to listen to prison staff, women in prison and organisations, and we make changes to the framework whenever appropriate.
Valerie Vaz
I thank the Minister for his response, but clothes, books and stationery are the very necessities of life. He will know about the independent monitoring board’s report on New Hall prison and the effect on the female estate. Will he at least review the effect on female prisoners of the one-parcel-of-clothing rule?
Simon Hughes
The incentives and earned privileges policy framework is an important reform to ensure that privileges in prison are no longer automatic. It is a reform that we brought in—it was not the case under the last Labour Government—and I hope Labour now supports the principle that people should earn privileges. On women’s clothing, however, female prisoners are not required to wear prison clothing; unlike male prisoners, they do not have to earn the right to wear their own clothing. There has always been a restriction on the number of items of clothing they can have in their cells, but I have insisted that there be no restriction on the amount of underwear they are permitted at all times when in custody.
Fiona Mactaggart (Slough) (Lab)
10. How many prison officers have been assaulted during the course of their work in the last 12 months; and if he will make a statement.
The Parliamentary Under-Secretary of State for Justice (Andrew Selous)
There were 3,470 assaults on staff in the year to 30 September 2014, and I can assure the hon. Lady that I get angry and upset at every single one. There is growing evidence that the increased smuggling of new synthetic drugs into prisons is a major factor in levels of prison violence, and we have already announced a series of measures to crack down on it. We will ensure that governors have the powers and support they need to tackle the problem.
Fiona Mactaggart
Is the Minister as shocked as I am at the number of serious assaults in male prisons? The number has nearly doubled from 241 in September 2009 to 418 last September. Will he look at the record when the Conservatives were last in charge of our prisons, when they cut prison officer numbers and then had to undertake an emergency recruitment programme in 1996?
Andrew Selous
The hon. Lady is right that these are extremely serious issues, but there is a growing body of evidence that the increase in the number of serious assaults is linked to the increase in new psychoactive substances in prisons. I hear that from governors and prison officers in every prison I visit. We have taken a series of measures, announced only a couple of days ago by the Secretary of State, to give governors more powers to crack down on the problem. We are trying to educate families and friends of prisoners not to smuggle these substances into prisons. If we can reduce the amount of those drugs in prisons, we will reduce levels of violence. All those things, along with the protocol with the police and Crown Prosecution Service and the increased use of body-worn cameras, will help to tackle this serious issue.
Jenny Chapman (Darlington) (Lab)
Can we just remind ourselves what we mean by “a serious assault” on a prison officer? It can mean serious cuts, fractures, concussion, loss of consciousness and damage to internal organs. If these were any other public servants—nurses, for instances—there would rightly be a public outcry. These are public servants going to work every day too often now in fear of their lives. The Minister has a duty of care towards them. What will he do now—it is not just about drugs—to protect staff in our prisons?
Andrew Selous
The hon. Lady is absolutely right that prison officers are front-line public servants who keep us safe, and I have told her how seriously I take this issue. I read the reports on a daily basis, and I can assure her that they affect me as much as they do her and everyone else in the House. We are taking action in three areas: a wider range of punishments to crack down on the use of new psychoactive substances; the new protocol—it has never happened before—between the CPS and police forces to ensure that prisoners who attack staff or other prisoners spend longer behind bars; and an increased use of body-worn cameras. All that will help.
Stella Creasy (Walthamstow) (Lab/Co-op)
11. What steps he is taking to support victims of crime.
The Minister for Policing, Criminal Justice and Victims (Mike Penning)
We published “Our Commitment to Victims” in September 2014. In addition, I chair the victims panel, and we will bring forward a victims law. On Thursday, I launched TrackMyCrime, which, for the first time, will enable victims to track their crime as it passes through the criminal justice system. Across the House, we should congratulate Avon and Somerset constabulary on piloting and bringing forward this initiative.
Stella Creasy
In November, the Minister wrote to me to say that this Government had decided to be “silent” on the rights of murder victims abroad, so that they did not have to do anything to help the families secure justice. The Minister will try to talk about the new directives for victims, but why have the Government been silent about the rights of the British taxpayer Tyrell Matthews-Burton, and yet have spoken up for others?
Mike Penning
I have met the hon. Lady, and I know that she is passionate—and quite rightly so—in speaking up for her constituents and victims. As she knows, it is about the definition within the law as it was, and it is no good attacking this Government, because it was exactly the same for the 13 years under the previous Government. We are making the changes.
Maria Miller (Basingstoke) (Con)
24. Increasing numbers of victims are victims of crime committed online. Many have experienced disturbing and threatening behaviour. What steps are the Government taking to support victims of that type of crime?
Mike Penning
I congratulate my right hon. Friend on the campaigning work she has done on this subject. The type of crime she describes is just as illegal if it is done online as it would be if it was done face to face. We are trying to support everybody, but there are difficulties, not least in getting people to come forward. TrackMyCrime will help. If a crime has been perpetrated in a domestic situation, for instance, people can get the e-mails at work; it is their choice where they get the information from.
Julie Hilling (Bolton West) (Lab)
21. Further to that point, what discussion has the Minister had with colleagues in the Home Office about how victims of cybercrime and other fraud are being treated by Action Fraud, when they are not even told whether their case is being investigated, let alone prosecuted?
Mike Penning
I am a Minister in the Home Office, as I am sure you are aware, Mr Speaker, as well as the Ministry of Justice, so I am very close to this issue. Through TrackMyCrime people will know exactly where in the criminal justice system their case lies. Across the House, we should congratulate Avon and Somerset on bringing forward the initiative, which is now in 43 police authorities around the country.
Mr Speaker
The Minister of State is not omnipotent; he is nearly ubiquitous—a point of which we have been reminded several times today. We are aware of the sheer scale and extent of his responsibilities.
Crispin Blunt (Reigate) (Con)
We have already legislated to increase the duty on sentencers to consider compensation from offenders to their victims. We have taken powers to increase the amount that can be attached against benefits in future, so that the sums are actually paid to victims. We are increasing work in prisons so that prisoners can earn resources that can be paid to victims. Will the Minister tell us what progress is being made on delivering compensation from offenders to victims of crime in reality?
Mike Penning
I am proud to say that we have just announced that there will be £40 million extra each year on top of the £50 million compensation already paid. A lot of that money comes from the perpetrators of crimes. We hope to get more money from offenders, and we are working to ensure that that happens.
Charlie Elphicke (Dover) (Con)
12. What steps his Department is taking to promote mediation and the use of independent experts to reduce the number of boundary dispute cases coming before the courts.
The Minister of State, Ministry of Justice (Simon Hughes)
The coalition is committed to reducing the number of property boundary disputes that come before the courts, as we are to reducing pressure on the court system more widely. I pay tribute to the work my hon. Friend has done, particularly his Property Boundaries (Resolution of Disputes) Bill. We published a scoping study on 15 January, and I hope that will provide a basis for agreeing a way forward that will lead to greater use of mediation and expert determination.
Charlie Elphicke
I thank the Minister for that answer. Does he agree that when neighbour property boundary disputes reach the courts, the legal costs often rack up, making it harder to settle the case? That is why I have been making the case for compulsory fast-track mediation, as in the party wall legislation, to make it easier to proceed and to avoid this problem.
Simon Hughes
I am absolutely persuaded that costs mount as people go to court, and I want to see the pressures and costs on our court system, as well as on individuals, reduced. We have taken steps over the past year to increase the use of mediation in the family courts, which has been successful. That should be applied to other disputes, including over property boundaries, and experts should also be used, but whether it is right to go down a mandatory route is the difficult question. I will work with my hon. Friend to see if we can reach agreement on how to move forward.
Mr Speaker
I would have called the hon. Member for Oldham East and Saddleworth (Debbie Abrahams), but she “boinged” too late. I call Kate Green.
Kate Green (Stretford and Urmston) (Lab)
13. What steps his Department is taking to encourage people to become magistrates and to train new magistrates.
The Minister for Policing, Criminal Justice and Victims (Mike Penning)
I will just “boing” again, Mr Speaker. The role of a magistrate is already a sought-after role in our communities and competition for vacancies is very strong.
Kate Green
I declare an interest as a life member of the Magistrates’ Association, which has expressed concern to me about the new provisions of the Offender Rehabilitation Act 2014, which came into force this week in relation to the new activity requirements. The association says that it has been inundated with queries from magistrates about these new provisions. Will the Minister tell us what detailed training has been given to magistrates?
Mike Penning
There is a substantial and comprehensive training programme, which is under the overall supervision of the Judicial College. I will write to the hon. Lady giving a full and detailed answer—or, rather, the Minister responsible will.
Mr Philip Hollobone (Kettering) (Con)
Why do magistrates have to retire at 70? We are losing years of experience from willing volunteers. I think that the regulations should be scrapped, so that hundreds more people could continue to serve in our magistrates courts.
Mike Penning
I understand exactly where my hon. Friend is coming from. That sort of experience is important. However, we must also bring young people into the magistrates service, otherwise there would be no throughput in the system.
Michael Connarty (Linlithgow and East Falkirk) (Lab)
14. How many people have been convicted of human trafficking offences in the last four years.
The Lord Chancellor and Secretary of State for Justice (Chris Grayling)
That question does not sit within the responsibilities of the Ministry of Justice; it is a question for the Home Office. However, I can inform the hon. Gentleman that between 2010 and 2013—the latest year for which figures are available in relation to human trafficking offences on an all-offences basis—the number of convictions increased by nearly 66%. The Government are committed to stamping out this abhorrent crime, building on the United Kingdom’s strong track record of supporting victims and fighting the perpetrators.
Michael Connarty
I am sorry to learn that the Secretary of State for Justice thinks that convictions for trafficking are not really his responsibility. I should have thought that those at the Ministry of Justice were the very people to deal with them. In Scotland, the Minister for Justice takes responsibility for trafficking convictions there. My criticism of the new Modern Slavery Bill is that all the laws for which it provides are exactly the same as those that have operated up to this moment.
I do not know what “66%” means: 66% of nothing is nothing. We want to know why the Ministry of Justice did not argue for the new laws that Lord Judge and Peter Carter recommended to the Joint Committee that was set up to look into the issue.
Chris Grayling
In response to the hon. Gentleman’s first point, I can tell him that it is a simple matter of fact in Government that this issue is looked after by the Home Office. As for his second point, I do not believe that any past Government have done more than the present Government to tackle human trafficking. Work is being done across Government and across the public sector to deal with a crime that we all believe is abhorrent, and that we all want to see stamped out.
Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)
The Secretary of State says that the issue of human trafficking is not his responsibility, but the issue of convictions is, and one of the key challenges is gathering evidence. In my constituency, I often meet victims many years after the trafficking offences have been committed. The Home Office may be responsible for some of these matters, but what is the right hon. Gentleman’s Department doing to improve the evidential chain and ensure that the evidence is there in court to secure convictions?
Chris Grayling
The securing of evidence to bring prosecutions to court is a matter for the police and the Crown Prosecution Service, but our Department will always do all that it can to facilitate their work. I expect our reforms of the court system to improve the process in both those organisations, but we depend on the very good work done by our police service and the Crown Prosecution Service to ensure that people are prosecuted.
Dr Julian Huppert (Cambridge) (LD)
15. How many young people were in prison (a) on 28 January 2015 and (b) in April 2010.
The Parliamentary Under-Secretary of State for Justice (Andrew Selous)
In April 2010, 2,149 people under 18 were in custody. The latest published figures available for the youth custody population relate to November 2014, when 1,055 people under 18 were in custody. That is a decrease of 51%.
Dr Huppert
That is a substantial decrease and it is very welcome, particularly at a time when crime is falling. Much of it has been due to the excellent work of the Youth Justice Board, which should be congratulated. Does the Minister agree that we should take similar steps to try to reduce the number of women in prison, which is what has been argued for by the Minister of State, Ministry of Justice, my right hon. Friend the Member for Bermondsey and Old Southwark (Simon Hughes)?
Andrew Selous
I thank the hon. Gentleman for his words of praise for the Youth Justice Board. That organisation, along with colleagues in the youth offending teams, has done excellent work in reducing the number of entrants to youth custody. However, decisions about which people should be sent to prison are decisions for the courts, and women’s prisons are the responsibility of my right hon. Friend the Minister of State.
Sir Bob Russell (Colchester) (LD)
16. How many prisoners on remand committed suicide in the last five years; and how many such people were in safe cells.
The Parliamentary Under-Secretary of State for Justice (Andrew Selous)
Every death in prison custody is a tragedy. The Ministry of Justice records the number of self-inflicted deaths and does not make any attribution of intent; that is determined at inquests. In the last five years, there have been 108 self-inflicted deaths in prison custody of prisoners on remand. Safer cells are designed to have fewer obvious ligature points than conventional cells, but no cell can be entirely safe and free of ligature points. Three of those deaths were recorded as having taken place in safer cells.
Sir Bob Russell
I am grateful for that answer, but if the Prison Service had taken any notice of my Adjournment debate in 2000 on safer cells in prison, it would know that the quick arithmetic is that several hundred lives would have been saved. Will the Minister give an assurance that the Prison Service will get its act together and take the positive measures necessary for safe cells, which would minimise deaths in prison?
Andrew Selous
When I get back to my office I shall make it my business to read the hon. Gentleman’s Adjournment debate from 2000, as I recognise that he has a serious interest in this subject. Let me tell him the action that we are taking to deal with this issue. First, we accept, and act on, the many recommendations of the prisons and probation ombudsman. I also point out to the hon. Gentleman that the increase in deaths has occurred in a range of prisons in different circumstances, so there is no obvious pattern. We are putting additional resources and support into safer custody work and in particular into improving the consistency of the application of the case management system for prisoners identified as at risk of self-harm or suicide, and there is also additional support at regional level to share good practice.
John McDonnell (Hayes and Harlington) (Lab)
This morning the Minister very kindly provided to the Justice Committee for publication the latest figures on suicides in prisons for 2011, 2012 and 2013 and nine months of last year. They show a total of 256 suicides in our prisons during that period. At the same time the Minister provided us with the figures on the ratio of the number of prisoners to staff. It has gone up from 3.8 to 4.9 in the same period. Does he not see a correlation between fewer staff dealing with more prisoners and less safe prisons?
Andrew Selous
I recognise that the hon. Gentleman, who is a distinguished member of the Justice Committee, takes a serious and ongoing interest in this. As I said to the hon. Member for Colchester (Sir Bob Russell), the rise in self-inflicted deaths has taken place in contracted prisons, which have not been subject to reductions, as well as in public sector prisons and prisons that have completed the benchmarking process, so there is no obvious connection between the two. I would just repeat what I have said: we look at every single death; we learn the lessons from the coroner’s report and the prison and probation ombudsman; we have put in extra resource both at prison level and at regional level to try to reduce the number of deaths; and we are absolutely as concerned about this as the hon. Gentleman rightly is.
Debbie Abrahams (Oldham East and Saddleworth) (Lab)
17. What recent assessment he has made of the effectiveness of mediation services provided for family law cases.
The Minister of State, Ministry of Justice (Simon Hughes)
Mediation between separating couples helps reduce the stress on children and families and the pressure on the courts system, and saves money for taxpayers. Last year nearly two-thirds of couples attending a single mediation session involving children reached full agreement at that session, and seven out of every 10 couples choosing mediation ultimately reached an agreement. That is why the coalition Government have funded a free mediation information meeting and a free first session provided that one party is legally aided.
Debbie Abrahams
My constituent David Burke has described the mediation process for family law cases as shambolic, and his experience is not unique. This is working against enabling parental responsibility, as the legislation originally intended. What are the Government doing to address these failings?
Simon Hughes
I have to tell the hon. Lady that the message here is not one of failure but one of increasing success. The number of people attending mediation assessment meetings has gone up in the last three quarters, and there is no report of these being shambolic. I will willingly meet the hon. Lady and her constituent on the subject, but I am clear that her party is committing no extra money for legal aid, so it will not be any different or greatly reformed under Labour.
Karl MᶜCartney (Lincoln) (Con)
18. What steps the Government are taking to stop the use of mobile phones in prisons.
The Parliamentary Under-Secretary of State for Justice (Andrew Selous)
We take this problem very seriously, stopping many mobile phones getting into prisons and finding those that do get in. We search prisoners, staff and visitors, we use X-ray and body scanners, CCTV and closed visits, and we deploy mobile phone blockers. We have also amended the Serious Crime Bill to enable the National Offender Management Service to instruct mobile phone companies to disconnect any phone that is found to be used within a prison. This Government have also increased the punishment for possessing an unauthorised mobile phone in prison.
Karl MᶜCartney
I thank the Minister for that answer. Ministry of Justice figures reveal that there have been 7,451 seizures of mobile phones and SIM cards in 2013 across the UK. Is there a difference in detection rates between establishments run by Her Majesty’s Prison Service and those run by private contractors, and if so, what can that be put down to?
Andrew Selous
I am not aware of any difference in the rates of detection between different prisons, but my hon. Friend is right to draw attention to this issue. We want to protect victims from being terrorised by prisoners from within prisons, and we also want to stop prisoners carrying on organising crimes from within prisons. That is why we take this issue so seriously. We are using blockers and we are now disconnecting. We will continue to focus on the matter.
Nic Dakin (Scunthorpe) (Lab)
T1. If he will make a statement on his departmental responsibilities.
The Lord Chancellor and Secretary of State for Justice (Chris Grayling)
I am pleased to inform the House that we have this week taken further significant steps in implementing our transforming rehabilitation reforms. This will reduce reoffending, which has been much too high for much too long. On 1 February, we brought into force the remaining uncommenced provisions of the Offender Rehabilitation Act 2014. This means that, for the first time, virtually all offenders will be given a proper chance of rehabilitation. The Act extends statutory supervision and support to the 45,000 offenders a year who are released from prison sentences of less than 12 months, the majority of whom currently receive no support at all after their custodial sentence ends. They simply walk the streets with a few pounds in their pockets. This group of offenders has the highest reoffending rate of almost any group; almost 60% of those released from short prison sentences went on to reoffend within 12 months. The changes mean that any offender whose offence was committed on or after 1 February and who has been sentenced to a custodial term of more than one day will now receive at least 12 months’ supervision after release. That is a big step forward.
Nic Dakin
To paraphrase Oscar Wilde: to lose one chief inspector could be considered a misfortune, but to lose two looks somewhat careless. Will the Secretary of State tell the House precisely when he became aware of Mr McDowell’s links to Sodexo and whether that was before Mr McDowell was appointed to the role? Will he also tell us why he chose not to share that information with the Justice Select Committee when it was going through the pre-appointment scrutiny hearings?
Chris Grayling
Let us be clear that the recruitment of Mr McDowell followed Cabinet Office guidelines exactly, as I have said to the House and to the Select Committee before. I do not believe that someone should be denied the chance to apply for a job based on hypotheticals of what may happen. I would commend Mr McDowell for recognising the issue when it arose, when his wife was promoted in November, and for taking what I think was a sensible decision. I think he is an honourable and upstanding public servant, and I wish him all the very best.
Nick de Bois (Enfield North) (Con)
T3. I should like to take this opportunity to extend my deepest sympathy to the family of Shaquan Sammy-Plummer, who was tragically and senselessly stabbed to death on Friday night in the borough of Enfield. The Secretary of State knows that there are many complex reasons surrounding the causes of knife crime, but he will also know that the House has approved a change in the law proposed by my hon. Friend the Member for Enfield, Southgate (Mr Burrowes) and me which would mean that the possession of a knife for a second time would carry a guaranteed jail sentence. Will he update me on the progress of that legislation? To kill someone with a knife, you first have to possess a knife.
The Minister for Policing, Criminal Justice and Victims (Mike Penning)
I am sure that the whole House will want to send its commiserations to the family of my hon. Friend’s constituent who has lost his life. Naturally, the police investigation is ongoing so I cannot comment on that individual case, but we are awaiting Royal Assent to the Bill to which he alluded, and as soon as that comes through we will be able to take things forward.
Sadiq Khan (Tooting) (Lab)
We already know how little the Justice Secretary thinks of our international human rights obligations, given that he wants to repeal the British Human Rights Act and walk away from the European convention on human rights. What is the Ministry of Justice’s motivation for signing a £5.9 million contract with a country whose justice system is widely condemned for the use of torture—which is what a sentence of 1,000 lashes amounts to—and of execution by beheading?
Chris Grayling
We have not signed a contract. Under this Government and under the last one, our Departments have worked with other Governments around the world to try to encourage improvements and best practice in their justice systems. I believe that that is the right thing to do. We should try to influence countries to move their justice systems in the right direction, and we will continue to do that.
Sadiq Khan
I look forward to hearing about the best practice for beheading.
We have a prisons crisis here, with the chief inspector of prisons being sacked. The chief inspector of the probation service has resigned. We have judges criticising Ministry of Justice policies on a daily basis, we have had disks containing sensitive information lost by the MOJ, and the legal profession is boycotting the summit to mark the 800th anniversary of Magna Carta, at which the Secretary of State is the keynote speaker. Why does he think that those who work in and use the justice system think so little of him?
Chris Grayling
The right hon. Gentleman cannot even gets his facts right; I am not the keynote speaker at the global law summit. It is being run independently with a number of key people from around the world, including the wife of a former Labour Prime Minister. The reality is that a leading figure in the justice world said to me last week, “Do you know, I may not agree with your policies, but at least you’ve got some; the other party hasn’t got any.”
Richard Graham (Gloucester) (Con)
T4. Last week, a much loved young man of 19, Zac Evans, was killed in a horrific attack by a man with a machete while trying to separate two women in a scuffle. The trial of the killer is due to be held in Bristol, but it would be better, especially for Zac’s family and, I believe, for all of Gloucester, for this local outrage to have justice delivered at the Crown court in Gloucester. Will my right hon. Friend support the letter I shall be writing to the Lord Chief Justice seeking precisely that solution?
Chris Grayling
We all condemn such a horrendous act and extend our best wishes and condolences to the victim’s family. The allocation of cases is and will always be a matter for the judiciary, and there are sometimes good reasons for their picking the locations that they do, as it is in the interests of justice to do so. I know the Lord Chief Justice well. He is deeply sensitive to the issues that victims face, and I am sure he will look thoughtfully at the letter that my hon. Friend sends him.
John Robertson (Glasgow North West) (Lab)
T2. Lord Lexden, the official historian of the Conservative party, has attacked the Lord Chancellor, saying: “Britain must have a Lord Chancellor who puts his duty to the law above party politics.”Why did he say that?
Chris Grayling
I believe it is the job of the Lord Chancellor not only to uphold the law but to change it where it is necessary to do so. The reforms of judicial review are necessary, measured and proportionate. They are reforms that were argued for by Ministers in the previous Government, but of course they never did anything about it.
Henry Smith (Crawley) (Con)
T5. Last week, I was privileged to attend a ceremony at the Crawley Band of Brothers, where men mentor former young offenders to help them turn their lives around. What further steps can the Department take to encourage such voluntary groups to help the rehabilitation of offenders?
The Parliamentary Under-Secretary of State for Justice (Andrew Selous)
I share my hon. Friend’s enthusiasm for what voluntary groups such as a Band of Brothers can do, alongside the work of our public sector probation professionals, to reduce reoffending further, which is what our reforms are all about. No doubt he will be pleased to know that 19 of the 21 areas have a voluntary group such as the one he mentioned in their tier 1 providers, and a Band of Brothers is part of MTCnovo’s supply chain, delivering rehabilitation services in London.
Bill Esterson (Sefton Central) (Lab)
I do not think the Justice Secretary answered the question from my hon. Friend the Member for Scunthorpe (Nic Dakin), so I will give him another go. Did the Justice Secretary know before the appointment of the chief inspector of probation that his wife was the managing director of Sodexo Justice Services? Why did the Justice Committee not have that information for its pre-appointment hearing?
Chris Grayling
I will say it once again. The hon. Gentleman asked about the Justice Committee. Of course my Department has been aware of the situation, but the reality is that we have followed, to the letter, the Cabinet Office guidelines. I do not believe we should disqualify somebody from applying for a job because of something that may, hypothetically, happen.
Charlie Elphicke (Dover) (Con)
T6. My constituents are concerned about the claims culture that we saw in past times, which has been putting people off volunteering, and the risk of erroneous prosecutions. What progress have the Government made on dealing with those issues?
Chris Grayling
I am very pleased that we have now passed the Social Action, Responsibility and Heroism Bill through both Houses of Parliament. Interestingly, the Labour party has been saying all along that the Bill is meaningless, but in the House of Lords Labour tried to remove a chunk of it because of worries about the impact on employees. The Opposition cannot have it both ways: either the Bill does something, in which case they should ignore it, or it does not do something, in which case they might have a point. The reality is that the Bill makes a real difference: it will protect volunteers and small employers against spurious claims in the workplace. Once again, the Opposition say one thing in this place and do something completely different.
Mrs Emma Lewell-Buck (South Shields) (Lab)
I recently wrote to the Minister of State, Ministry of Justice, the right hon. Member for Bermondsey and Old Southwark (Simon Hughes), regarding the daughter of a constituent of mine who was murdered by her former partner in the 1990s. My constituent subsequently sought care of her daughter’s child, but, disgracefully, the law enabled her killer to obstruct the adoption proceedings. The Minister was unable to explain how this injustice was allowed to happen, and it appears that the legal situation has simply not changed in this regard. I urge him to take a proper look at this case, take whatever steps necessary to ensure it cannot ever happen again, and give my constituents some answers.
The Minister of State, Ministry of Justice (Simon Hughes)
I am very sympathetic to the issue that the hon. Lady raises. The Secretary of State and I met people arguing that the law should be changed so that there is a read-across from criminal convictions to the application in family law of rights in relation to children. The matter is actively on our agenda, and I am happy to accept representations and to meet the hon. Lady and her constituent.
Maria Miller (Basingstoke) (Con)
T7. My constituents are shocked by the recent appalling revelations about child abuse. What steps are the Government taking to toughen up sentencing for those who are found guilty of these appalling crimes against children?
The Minister for Policing, Criminal Justice and Victims (Mike Penning)
I am sure the whole House wants to see people who perpetrate those sorts of crimes go through the criminal justice system and spend the right amount of time in prison. That is why we have toughened up this area and why the indeterminate sentences are there, and the European Court upheld the decision on that this morning.
Jeremy Corbyn (Islington North) (Lab)
Did the Secretary of State know whether Mr McDowell had a family relationship with Sodexo before he referred the case to the Justice Committee?
Chris Grayling
I think I have answered that question already. I said yes, we knew that Mr McDowell had that relationship, and yes, we followed the Cabinet Office guidelines to the letter. At the time, his wife did not hold a position in the rehabilitation arena. She has now moved to a position where she will be the head of that part of the business. Mr McDowell has decided to step to one side, which is a creditable decision to take. As I said earlier, I do not believe that somebody should be disqualified from applying for a job because of a hypothetical. I know that the Opposition do not agree, and they seem to be out to get Mr McDowell. I can only reiterate that he is a fine public servant. I regret the fact that he has had to leave and I hope that he has a good career in the future.
Mark Menzies (Fylde) (Con)
T8. Kirkham prison in my constituency has developed a solid reputation for retraining inmates to prepare them for life on the outside. Will the Minister update me on what programmes are available to assist them to re-enter the world of work and end the days of offending?
Andrew Selous
I pay tribute to the staff at Kirkham prison for the good work they do in getting inmates into work. My hon. Friend is right that this is a really important area; we do take it seriously. I am pleased to tell him that we have increased the number of hours worked in prison from 10.6 million to 14.2 million and that our transforming rehabilitation reforms will ensure that prisoners are prepared for the world of work as they leave. I am pleased to say that increasing numbers of employers are doing really well at taking on ex-offenders.
Nick Smith (Blaenau Gwent) (Lab)
The average number of days taken to remove a foreign national offender has increased year on year from 143 days in 2010 to 187 days in 2013. Why is the Government’s record so poor?
Andrew Selous
I think the hon. Gentleman should tread carefully, given that the number of foreign national offenders in our prisons doubled while his party was in power and has come down while we have been in power. On a serious note, I share his frustration. I want to see removals speeded up. I can tell him that we now have the first prisoners taken back on the prisoner transfer agreement with both Nigeria and Albania, but he is right that there is further progress to be made.
Tessa Munt (Wells) (LD)
Is the rehabilitation work with prisoners with a drug problem robust enough now to mean that the Secretary of State’s Department has finally halted the practice of retoxification of prisoners in anticipation of their release?
Chris Grayling
I think we still have work to do in that respect. In particular, we have a problem with the new generation of psychoactive substances that do not show up in tests. I remember a conversation with a group of staff in one of our prisons working with offenders with an addiction. They said that the problem was that when those offenders leave prison nothing happens. There is no requirement on them to carry on treatment. They disappear off into the community and get back on drugs. Under our rehabilitation reforms, there is now a power to require those people to take part in rehabilitation for a 12-month period after they have left.
Mr Speaker
We are extremely grateful to the Secretary of State. Extreme pithiness is now required.
Ian Lavery (Wansbeck) (Lab)
Does the Secretary of State share my grave concerns at the recently published report by the chief inspector of prisons on HMP Northumberland? Does he agree that if the Government do not do something, one of these serious incidents will turn into a tragedy that we all regret?
Chris Grayling
I have visited HMP Northumberland. It has been going through a period of transition, but the model of a working prison that will substantially extend the amount of work done by prisoners in that jail must be the way forward. I look forward to seeing improved inspection reports in future and a dramatic increase in the amount of work done and in prisoners’ employability when they leave.
Nicola Blackwood (Oxford West and Abingdon) (Con)
In the Select Committee on Home Affairs last week, we heard the anti-female genital mutilation campaigner Leyla Hussein describe the death threats and intimidation she and her family, including her 12-year-old daughter, have to endure as the price for her brave stand against this appalling form of child abuse. It is essential that the thousands of hidden victims and witnesses to FGM see how seriously the Government take it and know that if they come forward they will be protected. What steps are the Government taking to ensure that victims and witnesses to FGM are fully protected under the law?
Mike Penning
I am very proud that this Government have changed the law to protect not only the people who have had FGM done to them but those who might have it perpetrated on them. They should be protected in every way possible so that they have the confidence to come forward. That is what we are working on at the moment, and it is an important piece of work. A lot of this nasty abuse is online, and that is just as illegal as if those threats were made face to face.
Mr Speaker
Order. I am sorry to disappoint remaining colleagues, but demand has exceeded supply, as is usually the case.
Mr Speaker
Yes, we will come to points of order, which are always a considerable jollity.
Bank branches in Sedbergh
(9 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text
Tim Farron (Westmorland and Lonsdale) (LD)
I present a petition of more than 1,000 residents of Sedbergh in my constituency, which was collected by local volunteers led by Councillor Evelyn Westwood, against the plans of both NatWest and Barclays to close their branches in the town.
The Petitioners declare that,
the closure of both the Barclays and NatWest branches in Sedbergh would leave the town without any bank branch, causing an inconvenience for small businesses, vulnerable residents and the community of Sedbergh as a whole. The Petitioners therefore request that the House of Commons urges the Government to encourage the Chief Executives of both Barclays and NatWest to retain their branches in Sedbergh.
And your Petitioners remain, etc.
[P001424]
Points of Order
(9 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text
Mrs Madeleine Moon (Bridgend) (Lab)
On a point of order, Mr Speaker. My point of order relates to question 16 on today’s Order Paper and implies no criticism at all of the hon. Member for Colchester (Sir Bob Russell). The question refers to prisoners who have “committed” suicide. Prisoners no longer commit suicide; nor does anyone else since the Suicide Act 1961. The word “commit” suggests a criminal offence and is a pejorative term that offends many of those who have lost family and friends to suicide. The Table Office could be instructed to be vigilant about the use of such terms. Perhaps the appropriate term could have been “died by their own hand” or “took their own life”, but the question certainly should not have used the word “commit”, which relates to a criminal offence.
Mr Speaker
I am extremely grateful to the hon. Lady for her point of order and for kindly giving me advance notice of it. She makes a good point on which I confess I had not previously reflected. The phrase used in the question, and I appreciate what she said about the hon. Member for Colchester (Sir Bob Russell), is not disorderly, but I will ask the Table Office to consider whether its practice should be changed for precisely the good reason she has just given to the House. I hope that that is helpful.
Fiona Mactaggart (Slough) (Lab)
On a point of order, Mr Speaker. Earlier in this question session, the hon. Member for Shipley (Philip Davies) heard me scoff as he spoke. I scoffed when he referred to the Daily Mail as the source of his research, not because I do not care about the issue of rape, which is an issue I raised on the BBC in a “Newsnight” programme when the hon. Gentleman was eight years old.
Mr Speaker
I think that the point of order raised by the hon. Lady stands on its own. She has made her point with force and alacrity and the reason for her scoff is well understood.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
On a point of order, Mr Speaker. I seek your guidance in uncharted territory. We have not had a fixed-term Parliament before and visits to constituencies by Ministers become much more sensitive in this clear run-up to an election. I heard at 5.38 pm last Thursday that the Secretary of State for Work and Pensions would visit Kirklees college in the heart of my constituency at 11 am the next day. If that was an official visit, it would have been a courtesy to tell me that he was coming so that I could perhaps have been there to welcome him. I understand that Colne Valley and Dewsbury are highly sensitive marginal seats nearby, but this was an official visit, presumably paid for by the taxpayer, in the run-up to an election that we know will be on 7 May. What is the status of such visits and should there not be the usual courtesy of telling a Member when a Minister is visiting their patch?
Mr Speaker
I am grateful to the hon. Gentleman for his point of order. He asks what is the status of such an arrangement. The short answer is that it is a convention; it is not a requirement of parliamentary procedure or of our Standing Orders. That said, I think it is very much to be preferred that the convention should be observed, as it is for the most part by Members on both sides of the House. Notification, by definition, must take place before the visit, but in order to comply with the spirit of the convention, it seems to me reasonable that Members should have adequate notice of, in particular, official visits, so that if they wish to be present, they have the chance to be so. I do not in any way diminish the significance of the hon. Gentleman’s point or of what I just said when I note that the honouring of that arrangement has frequently been as much in the breach as in the observance, and that, I think, is regrettable. It is not a point applied to one side rather than the other.
I know that in the past, long before I was elected to the Chair, visits were made to institutions within my own constituency of which I did not have what I regarded as anything like adequate notice in order to be able to decide whether I wished to be present. I appeal to colleagues to be considerate and solicitous in these matters, because a colleague who does not observe the convention is not only doing the wrong thing, but wholly disabling himself or herself from subsequently complaining if the convention is not honoured when his or her own constituency is affected. I think that deals with the matter.
Sir Alan Beith (Berwick-upon-Tweed) (LD)
On a point of order, Mr Speaker. When the Justice Committee, as was mentioned earlier, held an appointment hearing for the chief inspector of probation, some information was not given to it, although the Cabinet Office guidelines did not require that to be done. Subsequently, the position changed quite significantly when the wife of Paul McDowell was promoted to a much more senior post in an organisation which had in the meantime obtained contracts for probation. I think it right to say by way of a point of order not only that in my view has Mr McDowell correctly resigned, but that I endorse what the Lord Chancellor has said about his integrity, I repeat what the Committee said about his suitability for the job and his abilities, and I dissociate myself from any attack on his integrity from any part of the House today.
Mr Speaker
What the right hon. Gentleman has said is interesting, both for its content and for the vantage point from which he speaks. Members will make their own assessment. I thank him for what he said, and we will leave it there.
Richard Graham (Gloucester) (Con)
On a point of order, Mr Speaker. When, earlier, I raised the horrific killing of my constituent, Zac Evans, the entire Opposition Front-Bench team, with one honourable exception, were chuntering and laughing—indeed, one of them continues to chunter now. May I ask if it would be in order for one of their representatives to confirm that there was no intended disrespect in relation to an horrific act, widely decried in my constituency?
Mr Speaker
I am grateful to the hon. Gentleman for what he says and understand the extreme seriousness with which he treats that extremely serious occurrence. I hope he will understand if I say that I do not think we want to get into choreographed responses on matters of this kind. I think it should be taken as read that such a matter is extremely serious, and I do not myself imagine for one moment that any member of the Opposition Front Bench intended any discourtesy. The hon. Gentleman has underlined one important point: Members should be sensitive to the mood of the House and the nature of the matter being raised. It was and is a very serious matter and I thank the hon. Gentleman both for his question and for raising it in the seemly fashion he has just done. [Interruption.] The hon. Member for Kingston upon Hull East (Karl Turner) is chuntering from a sedentary position, although I note that on this occasion he has not said what he ordinarily says, which is, “It’s a disgrace!” and that itself is a notable change—
Mr Speaker
The hon. Gentleman says it is. If there are no further points of order, we come now to the ten-minute rule motion.
Living Wage (Reporting)
(9 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text
Heidi Alexander (Lewisham East) (Lab)
I beg to move,
That leave be given to bring in a Bill to require listed companies to report annually on the percentage of their staff paid below a Living Wage; and for connected purposes.
I am introducing the Bill because we need to be more open about the problem of low pay in our economy. Many of the UK’s largest, most well known companies pay wages which people cannot afford to live on. Millions of shop workers, care assistants, cleaners and catering staff are paid so little that the only way they can make ends meet is with the help of tax credits and the payment of in-work benefits. Put simply, the state is supplementing the incomes of the low-paid while subsidising the wage bill of their employers. I believe that companies that can afford to pay the living wage have a responsibility to do so, and we should have a right to know when they do not pay it. Greater transparency is needed to raise public awareness of the problem and to encourage big companies to do the right thing.
We are approaching the end of the first Parliament since the 1920s in which people will be worse off at the end than they were at the beginning. This is a country where 4.9 million workers earn less than the living wage—the income necessary to achieve a minimum acceptable standard of living. That is one in five British workers who do not earn a fair day’s pay for a fair day’s work. The living wage is not just about having enough money to eat and pay the rent and the bills; it gives workers the means to live a dignified and decent life. For many of my constituents, the living wage means everything from being able to afford a family holiday now and again to peace of mind at the end of the month. It means being able to get home in time to see their children because they are not struggling to hold down two jobs. These are not unreasonable expectations, but they are being denied to far too many people by poverty-level pay.
In May 2010, the Prime Minister declared that the living wage was
“an idea whose time has come”.
Sadly, under his Government, we are still waiting. In the past five years, the number of people earning less than the living wage has soared by an additional 1.4 million. The majority of working-age households living below the poverty line now have at least one adult in work. In my constituency, there are over 10,000 people whose hard work is rewarded with a pay packet which does not give them enough to live a decent life. The recovery may have reached some in the City of London, but for those struggling on low pay in Lewisham, it has yet to materialise.
Every fortnight at my advice surgery I meet people who simply cannot afford to live off their earnings. They are often employed by some of our country’s biggest companies—the large supermarkets, for example. These are people who are doing the right thing—working hard and contributing—but they are not earning enough to pay the bills. I have been shown payslips where take-home wages are less than £1,000 a month, and I am asked what people are meant to live off when they have to pay £700 a month in rent. At the same time, their employers may make hundreds of millions of pounds a year in profit, much of which will go straight into the pockets of their shareholders.
The irony is that this is not just bad for our country’s living standards; it is bad for the Treasury too. This Government’s failure to meet their own deficit reduction targets has proved that low pay is a drain on our public finances. The wages of under-paid staff routinely have to be topped up by Government through the payment of tax credits and in-work benefits. In the circumstances, this support for the low paid is the correct approach, but it means that at the end of the day it is the taxpayer who is subsidising the wages bill of large private companies. Low pay is driving up the benefits bill and making it harder to get the deficit down.
The truth is that low pay stifles our economy, stunts taxes coming into the Treasury and ends up in more Government borrowing, which we can ill afford. That may be an economic plan of sorts, but it does not sound to me like one that is working. So something needs to change. In the UK, the living wage stands at £7.85 an hour, and the London figure is £9.15. I see no reason why big companies making significant profits should not pay it. If they choose not to do so, why should they not have to be up-front about that decision, and tell us?
This Bill would not compel anyone to pay a living wage. What it would do is give the public and workers a mechanism by which they can find out who pays it and who does not. Listed companies are already required to produce annual remuneration reports, but these focus on directors’ pay. The Bill would provide some balance—a focus on the bottom as well as the top. The data required to comply with the Bill could be generated relatively simply by the companies in question, but their impact would be significant: they would end the silence on poverty pay that allows many of our biggest companies to inflate their profit margins at the expense of their staff and of every taxpayer.
I have heard it said that low pay can in some ways be good for business. I guess the argument goes that increased profits should mean more money ploughed back into enterprise, meaning more economic growth. There are many assumptions in such an argument, and I am not so sure that it always stacks up. Low pay may sometimes mean higher short-term profits, but it can also mean demoralised staff who are preoccupied with their daily struggle to try to make work pay.
Paying workers a wage that supports a decent standard of living is not just the responsible thing to do; the research shows that there are also clear business benefits. Low pay has high costs, in reduced productivity, higher absenteeism and lower staff retention. It is for those reasons that over 1,000 companies have now signed up to be accredited living wage employers, from the energy company SSE to Chelsea football club.
Many public sector bodies are also leading the way. I was proud to be a member of Lewisham council when we became the first local authority to become a living wage employer, and I commend the determination of Lewisham’s mayor, Sir Steve Bullock, to roll out the living wage to even more contracted staff, despite a very tough financial outlook. I also commend you, Mr Speaker, for your efforts to make this House an accredited living wage employer.
Big and small employers alike now pay a living wage. The south London-based Jane Jefferson Cleaning, whose tagline is “The Only Way is Ethics”, is the only domestic cleaning company to be recognised by the Living Wage Foundation. If a small cleaning company can pay the living wage, why can firms that have multi-million pound salaries at the top not pay it at the bottom? A director in a FTSE 100 company now earns, on average, 130 times more than their average employee, and 300 times more than the living wage, yet only 18 of those 100 companies pay the living wage. The Government’s policy of “wait and see” on low pay has clearly failed. Legislating for greater transparency would celebrate the best employers and expose injustice to public pressure.
Britain cannot continue on its current path. The Government have failed to create the decent jobs and decent wages that we need for the next generation. Instead, they have preferred a silent race to the bottom, masked by loud trumpeting of falls in unemployment without a care for the nature and pay conditions of the jobs created. The next Labour Government will make the problem of low pay a national priority. We will increase the minimum wage to £8 an hour and give a tax break to companies that sign up to become living wage employers in the first year of the next Parliament.
Decent pay requires the British economy to generate better jobs, with improvements in skills and support for investment in cutting-edge industries, but it also needs more honesty about the sources of low pay, putting pressure on large companies to meet their responsibilities to their workers and the taxpayer as well as to their shareholders.
In conclusion, it might be entirely legal for large companies not to pay their staff a living wage, but that does not make it right. The Bill is not about forcing our largest employers to pay a wage above the statutory minimum; it is about encouraging them to make the right choices about the pay of the people they rely on. This simple Bill would introduce a simple reporting requirement. It would allow the public to recognise those companies that go above and beyond their legal obligations, enabling the consumer to identify those businesses that want to build a fairer economy as well as a stronger one. I commend it to the House.
Question put and agreed to.
Ordered,
That Heidi Alexander, Paul Blomfield, Lisa Nandy, Sarah Champion, Mr Steve Reed, Jenny Chapman, Natascha Engel, Teresa Pearce, Bridget Phillipson, Mr David Lammy, Nick Smith and Karl Turner present the Bill.
Heidi Alexander accordingly presented the Bill.
Bill read the First time; to be read a Second time on Friday 27 February, and to be printed (Bill 165).
Insurance Bill [Lords]
(9 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Economic Secretary to the Treasury (Andrea Leadsom)
Part 1 sets out some definitions for the Bill and is purely technical but, with your indulgence, Mr Chope, may I say again that this is a non-controversial Law Commission Bill, on which we had a constructive debate last week in the Second Reading Committee, and which has been scrutinised by a special Public Bill Committee in the other House? I hope that we can agree that clause 1 should stand part and move on to discuss the substantive clauses, taking each part in turn.
Cathy Jamieson (Kilmarnock and Loudoun) (Lab/Co-op)
As the Minister has outlined, this is a non-controversial Bill overall, and we did indeed debate and discuss it last week. I have no issue with clause 1 and think that it is important to get on to the other areas of the Bill on which the Minister might wish to answer some questions.
Question put and agreed to.
Clause 1 accordingly ordered to stand part of the Bill.
Clause 2
Application and interpretation
Question proposed, That the clause stand part of the Bill.
The Temporary Chair (Mr Christopher Chope)
With this it will be convenient to discuss the following:
Clauses 3 to 8 stand part.
That schedule 1 be the First schedule to the Bill.
Andrea Leadsom
As I explained to the Second Reading Committee, part 2 concerns the duty on prospective policyholders to disclose information to the insurer, which allows the insurer to assess and price the risk accurately. However, the existing law can be difficult to understand and even more difficult to comply with fully. A failure to provide all material information allows the insurer to refuse all claims under the contract.
Under the Bill, policyholders still have a duty to disclose information, and they should make an active search for relevant information, but insurers might need to ask the policyholder questions if they require further clarification. If a policyholder fails to make a fair presentation of the risk, there is a new system of proportionate remedies for the insurer, under schedule 1 to the Bill, based on what the insurer would have done had the failure not occurred.
Cathy Jamieson
There is nothing particularly controversial in clause 2, or indeed in clauses 3 to 8 and schedule 1. As the Minister said, the clause provides that the duty of fair presentation, which is set out in the remainder of the part, applies in the event of a variation to a non-consumer insurance contract as well as upon the initial agreement or the contract.
Clause 3 introduces a requirement on the insured to
“make to the insurer a fair presentation of the risk”
before the contract is entered into. That replaces existing duties in relation to disclosure and representations contained in the Marine Insurance Act 1906, but retains essential elements of those provisions in ensuring that the insured provides insurers with the information they require to decide whether to insure a risk and on what terms.
The Temporary Chair (Mr Christopher Chope)
With this it will be convenient to discuss clauses 10 and 11 stand part.
Andrea Leadsom
Part 3 deals with insurance warranties and similar terms. An insurance warranty is typically a promise by the policyholder to do something that mitigates the risk. Under the current law, any breach of warranty completely discharges the insurer from liability from the point of breach. That is so even if the breach is remedied before any loss is suffered and if the breached term had nothing to do with the loss. The insurer’s remedy therefore often seems unsuitable and too punitive. The Bill provides that an insurer will be liable for insured losses arising after a breach of warranty has been remedied. It also prevents an insurer from refusing payment on the basis of a breached term that could have had no bearing on the risk of the loss that actually occurred, such as where a warranty concerning a fire alarm is breached and the insured then suffers a flood in the insured property. The Bill also abolishes “basis of the contract” clauses. These clauses convert every statement made by a policyholder on a proposal form into a warranty.
Cathy Jamieson
Again, it has been helpful to hear the Minister’s comments. We have no difficulty with these clauses.
On clause 9, under the current law, an insurer may add a declaration to a non- consumer insurance proposal form or policy, stating that the insured warrants the accuracy of all the answers given or that such answers form the “basis of the contract”. That has the legal effect of converting representations into warranties. The insurer is discharged from liability for claims if the insured made any misrepresentation, even if it was immaterial and did not induce the insurer to enter into the contract. The Law Commission gave the example of a claim for flooding being refused, as the Minister suggested, because the insured had failed to install the right model of burglar alarm. The clause seeks to put an end to this practice by abolishing “basis of the contract” clauses in non-consumer insurance. Clause 10 replaces the existing remedy for breach of a warranty in an insurance contract.
Clause 11 was initially not included in the Bill. That gave rise to the introduction in the other place of a new clause that replicated a similar clause originally included by the Law Commission pertaining to situations in which an insured had breached a term of contract but could show that
“its breach of the term could not have increased the risk of the loss which actually occurred in the circumstances in which it occurred.”
In the Lords Committee, some expressed the view that this omission was an error. The Minister, Lord Newby, explained that the clause as originally drafted was
“too controversial to go through the special procedure for uncontroversial Law Commission Bills.”
He did, however, admit that it was
“difficult to argue against the policy and to say that insurers should be entitled to refuse liability for a loss that is of a completely different nature from that contemplated by the breached term.”
At the Government’s prompting, the Law Commission submitted a new draft, which became the current clause 11 and which was
“intended to minimise the uncertainty inherent in the first formulation”.
The clause acts to rectify the situation prior to the Bill when the actual nature of a breach of term was irrelevant. This has been a helpful process to ensure that that piece of tidying up was done. On that basis, we have no problem with these clauses.
Question put and agreed to.
Clause 9 accordingly ordered to stand part of the Bill.
Clauses 10 and 11 ordered to stand part of the Bill.
Clause 12
Remedies for fraudulent claims
Question proposed, That the clause stand part of the Bill.
The Temporary Chair (Mr Christopher Chope)
With this it will be convenient to discuss clause 13 stand part.
Andrea Leadsom
Fraud is a serious and expensive problem for insurers and innocent policyholders alike. According to industry statistics, policyholders currently pay an additional £50 on every insurance policy because of the cost of fraud to insurers. The Bill therefore strengthens and clarifies the civil law aspect of the Government’s drive to combat fraudulent claims by policyholders. The Bill sets out clear statutory remedies for the insurer where the policyholder has made a fraudulent claim. It affirms the common law position that the policyholder forfeits the fraudulent claim. The insurer has no liability to pay any element of it and can reclaim anything it paid before it knew about the fraud.
The Bill also clarifies an area of uncertainty, in that the insurer may choose to refuse any claim arising after the fraudulent act. However, previous valid claims should be paid in full. Finally, the Bill gives the insurer the equivalent remedies against a fraudulent member of a group insurance policy.
Cathy Jamieson
The Minister has again clearly outlined what the clauses do. As she said, clause 12 sets out the insurer’s remedies where the insured makes a fraudulent claim. It puts the common law rule of forfeiture on a statutory footing. Where the insured commits a fraud against the insurer, the insurer is not liable to pay the insurance claim to which the fraud relates. Where the insurer has already paid out insurance moneys on the claim and later discovers the fraud, the insurer may recover those moneys from the insured. As we have heard, that provides the insurer with a further remedy giving it an option to treat the contract as if it had been terminated at the time of the “fraudulent act”. That does not apply where a third party commits a fraud against the insurer or the insured, such as where a fraudulent claim is made against an insured party who seeks recovery from its insurer under a liability policy.
Clause 13 gives the insurer the remedies where there is fraud by one member of a group scheme. Again, we have no difficulty with these clauses standing part of the Bill.
Question put and agreed to.
Clause 12 accordingly ordered to stand part of the Bill.
Clause 13 ordered to stand part of the Bill.
Clause 14
Good Faith
Question proposed, That the clause stand part of the Bill.
The Temporary Chair (Mr Christopher Chope)
With this it will convenient to discuss clauses 15 to 18 stand part.
Andrea Leadsom
Part 5 deals with two separate matters: the principle of good faith and the ability of parties to contract out of the provisions of the Bill.
Clause 14 retains the statutory and common law principle that a contract of insurance is one predicated on good faith. However, the clause abolishes avoidance of the contract as the remedy for breach, recognising that avoidance is capable of operating very harshly against policyholders.
The provisions are a default regime for business insurance contracts. They are expected to be appropriate for the majority of insurance contracts, but there may be circumstances when parties prefer to set out their own bespoke arrangements. However, if an insurer wishes to rely on a term that will operate more harshly against the policyholder than the Bill otherwise provides, clauses 16 and 17 require it to act transparently when the contract is made, by ensuring that the meaning of the alternative provision is clear, and by drawing the attention of the policyholder to it. In so far as the Bill applies to consumers rather than businesses, it is a mandatory regime. Insurers are not entitled to contract out of its provisions to the detriment of consumers.
Cathy Jamieson
Under the Marine Insurance Act 1906, insurance contracts are ones of “utmost good faith”. Clause 14 removes avoidance of the contract as a remedy for breach of that duty of good faith, both from the 1906 Act and at common law. The intention of clause 14 is that good faith will remain an interpretative principle, with section 17 of the 1906 Act and the common law continuing to provide that insurance contracts are contracts of good faith.
Clauses 15 and 16 prohibit insurers from inserting in an insurance contract terms that would leave the insured—be they a consumer or a non-consumer—in a worse position than that required by the Bill.
Clause 16 defines transparency in respect of what an insurer must do to draw the insured’s attention to the disadvantageous terms of the contract. Clause 17 sets out the transparency requirements. For example, the insurer should take sufficient steps to draw disadvantageous terms to the insured’s attention within a reasonable time frame prior to their entering into the contract, but when an insured has knowledge of the term, they may not claim that the insurer has not brought it to their attention. Clause 18 deals with the insurer’s remedies where a member of a group insurance contract makes a fraudulent claim. Again, we do not think that these clauses are controversial and we are content for them to stand part of the Bill.
Question put and agreed to.
Clause 14 accordingly ordered to stand part of the Bill.
Clauses 15 to 18 ordered to stand part of the Bill.
Clause 19
Power to change meaning of “relevant person” for purposes of 2010 Act
Question proposed, That the clause stand part of the Bill.
The Temporary Chair (Mr Christopher Chope)
With this it will be convenient to consider clause 20 and schedule 2 stand part.
Andrea Leadsom
Part 6 covers a topic that is distinct from insurance contract law. It amends the Third Parties (Rights against Insurers) Act 2010 and will assist injured parties who have claims against parties that are now defunct where insurance was in place to cover such claims. As I said in the Second Reading Committee, part 6 will make it easier for mesothelioma sufferers to obtain compensation due from insolvent employers.
The Bill allows the Secretary of State, by regulations, to add or remove circumstances in which a person will fall within the provisions of the 2010 Act. The intention in the first instance is to use this power to add insolvency and other similar events to the 2010 Act. Draft regulations are being prepared by the Ministry of Justice. Once the first set of regulations are made, the 2010 Act can be commenced. The Government are committed to bringing the 2010 Act into force as soon as practicable.
Cathy Jamieson
In the Second Reading Committee, I welcomed the fact that part 6 gives mesothelioma sufferers the opportunity to be dealt with in a timely fashion and to receive the justice they deserve. It is a terrible condition that many people have suffered as a work-related illness. We should do everything possible to support them.
Clause 19 inserts a new section into the 2010 Act. It enables the Secretary of State to make regulations adding or removing circumstances in which a person is a “relevant person” for the purposes of the Act, provided that the Secretary of State considers that the proposed circumstances involve dissolution, insolvency or financial difficulty, or are similar to those for the time being prescribed in sections 4 to 7 of the 2010 Act. That seems sensible and we have no problem with the clauses or the schedule standing part of the Bill.
Sir Greg Knight (East Yorkshire) (Con)
I refer the Committee to my entry in the Register of Members’ Financial Interests.
Will the provision affect third-party cover under the Road Traffic Act 1988 and the level of insurance premiums taken out for motor insurance? May I also ask the Minister, en passant, to pay tribute to the Law Commission, on whose work this Bill is based?
Andrea Leadsom
My right hon. Friend will appreciate that this part of the Bill is designed to assist those who have insurance claims against parties that are now defunct, where insurance was originally in place to cover such claims. In theory, that could cover a motor insurance claim, but it is certainly not designed specifically to that end. Likewise, the cost of motor insurance will be determined by claims by the insurance companies themselves, so it is not envisaged that this will affect the cost of motor insurance.
I entirely agree with my right hon. Friend that the Law Commission has done an excellent job. Essentially, the Bill makes the insurance market more effective and fairer.
Question put and agreed to.
Clause 19 accordingly ordered to stand part of the Bill.
Clause 20 ordered to stand part of the Bill.
Clause 21
Provision consequential on Part 2
Question proposed, That the clause stand part of the Bill.
The Temporary Chair
With this it will be convenient to discuss clauses 22 and 23 stand part.
Andrea Leadsom
Part 7 deals with technical matters such as commencement, territorial extent and consequential amendments to existing legislation. The Bill repeals or amends various sections of the Marine Insurance Act 1906, which are superseded by provisions in parts 2 and 3. Clause 23 provides that the Bill extends to the whole of the United Kingdom, and that the provisions on insurance contract law will come into force 18 months after Royal Assent.
From a practical perspective, the new provisions will not apply to existing insurance contracts, but rather to new contracts and variations agreed after the Bill comes into effect. The regulation-making power on the Third Parties (Rights against Insurers) Act 2010 will come into force two months after Royal Assent.
Cathy Jamieson
As the Minister has said, clause 21 makes provisions consequential on part 2 and amends or repeals various sections of the Marine Insurance Act 1906, the Road Traffic Act 1988 and the Road Traffic (Northern Ireland) Order 1981, as well as the Consumer Insurance (Disclosure and Representations) Act 2012. She has also confirmed that clause 22 ensures that those provisions relating to fair presentation and good faith apply only to insurance contracts entered into after the end of the period of 18 months from the Bill’s entry into force. Clause 23 ensures that the Bill extends to the whole of the UK, apart from consequential provisions in clause 21 relating to Northern Ireland. Again, we are happy for these clauses to stand part of the Bill.
Question put and agreed to.
Clause 21 accordingly ordered to stand part of the Bill.
Clauses 22 and 23 ordered to stand part of the Bill.
Schedules 1 and 2 agreed to.
The Deputy Speaker resumed the Chair.
Bill reported, without amendment.
Third Reading
Andrea Leadsom
I beg to move, That the Bill be now read the Third time.
I am grateful to hon. Members for the useful debates on the Bill, and glad to have taken it forward based on proposals by the Law Commission and the Scottish Law Commission, to whom I reiterate my thanks. The Bill was rigorously scrutinised in the other place, and demonstrates the usefulness of the special parliamentary procedure for Law Commission Bills.
Together with the Consumer Insurance (Disclosure and Representations) Act 2012 that preceded it, the Bill marks the biggest reform to insurance contract law in more than a century. It is the product of careful consultation and consideration, and as a result it is well supported. It demonstrates the Government’s commitment to maintaining and growing the UK’s insurance industry both at home and abroad. I am grateful to all insurers, businesses and others who have supported the Bill, and to those who have participated in the Law Commission’s project and the legislative process. I am also grateful for the contribution made by the Opposition in both Houses towards the smooth passage of the Bill.
Cathy Jamieson
I, too, thank everyone who has worked on this important Bill, including the Law Commission and the Scottish Law Commission. It has been interesting to follow the special procedure. There is no doubt that the Bill was rigorously scrutinised in the other place, and a number of amendments were tabled. That perhaps makes our task in Committee and on Third Reading somewhat easier, and will help to ensure that the Bill safely completes its passage through the House.
I raised one issue that was originally suggested in the Law Commission reports but did not make it into the Bill: late payment. I want to give the Minister the opportunity to reply, but to recap briefly, the Law Commission report states:
“We consider that a policyholder should have a remedy where an insurer has acted unreasonably in delaying or refusing payment.”
It recommended
“an implied term in every insurance contract that the insurer will pay sums due within a reasonable time”,
with appropriate caveats. Those points were deemed too controversial to be included in a Law Commission Bill, and as I have said before, although the recommendations have merit, I recognise that a Law Commission Bill may not be the appropriate vehicle for putting such provisions into statute because of the way that “controversial” is interpreted.
I asked the Minister whether she would consider legislating for late payment by some other means. She offered encouragement on that and also said that
“evidence presented to the Law Commission, the Treasury and the Special Public Bill Committee demonstrated that the problems in the existing law are worse in theory than in practice.”––[Official Report, Insurance Bill Second Reading Committee, 26 January 2015; c. 9.]
Although the Minister provided some encouragement, she perhaps also suggested that such measures would not be a priority for the immediate future. It would be helpful if she clarified that point and said whether the Government have plans to take the issue forward and to what time scale. In general terms, the Bill has taken us forward and is largely technical in how it updates insurance law in statute. We have given it a good airing and should see it successfully enacted.
Andrea Leadsom
I am grateful to the hon. Lady for giving me the chance to put on the record the fact that the Government support the principle that insurers should make payment of valid claims within a reasonable time, and that they should be liable for compensation where appropriate should they fail to do so. The Government are always looking at ways to support and improve the position of the UK insurance industry, and it is hoped that legislative opportunities will arise to include that measure with other insurance-related provisions.
As the hon. Lady will know, the Government undertook a targeted consultation of insurance industry stakeholders in summer 2014 to assess support for the Bill and for a provision on late payment. The results of the consultation suggested that the late payment provision was not suitable for a Bill going through Parliament under the special procedure reserved for uncontroversial Law Commission Bills. The main arguments against such a provision were that it could lead to speculative litigation, or have the unwelcome effect of being used to exert undue pressure to expedite claim settlement, and those costs have not yet been quantified. Furthermore, adequate customer protections already exist, so the problems of late payment are worse in theory than in practice. The Financial Conduct Authority is currently undertaking a thematic review of the handling of commercial claims, and the issue is being considered from a regulatory angle.
As the hon. Lady recognised, not all recommendations made by the Law Commission are suitable for the special procedure for non-controversial Bills, and that provision was omitted from the Bill specifically to ensure that the special procedure was not abused. I repeat, however, that the Government support the principle that insurers should make payment of valid claims within a reasonable time.
Question put and agreed to.
Bill accordingly read the Third time and passed.
National Insurance cOntributions Bill (Money)
Queen’s recommendation signified.
Resolved,
That, for the purposes of any Act resulting from the National Insurance Contributions Bill, it is expedient to authorise the payment out of money provided by Parliament of any increase attributable to the Act in the sums payable under any other Act out of money so provided.—(Mark Lancaster)
National Insurance Contributions bill (programme) (No.2)
Ordered,
That the following provisions shall apply to the National Insurance Contributions Bill for the purpose of supplementing the Order of 8 September 2014 (National Insurance Contributions Bill (Programme)):
Consideration of Lords Amendments
(1) Proceedings on consideration of Lords Amendments shall (so far as not previously concluded) be brought to a conclusion two hours after their commencement at today’s sitting.
Subsequent stages
(2) Any further Message from the Lords may be considered forthwith without any Question being put.
(3) The proceedings on any further Message from the Lords shall (so far as not previously concluded) be brought to a conclusion one hour after their commencement.—(Mark Lancaster).
National Insurance Contributions Bill
(9 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Madam Deputy Speaker (Mrs Eleanor Laing)
I must draw the House’s attention to the fact that financial privilege is involved in Lords Amendment 1. If the House agrees to it, I shall ensure that the appropriate entry is made in the Journal.
Before Clause 1
Secondary Class 1 contributions: apprentices under 25
The Financial Secretary to the Treasury (Mr David Gauke)
I beg to move, That this House agrees with Lords amendment 1.
Some right hon. and hon. Members may recall the important initiative on apprentices announced by my right hon. Friend the Chancellor of the Exchequer in his autumn statement on 3 December. The Chancellor announced that the Government will abolish employer class 1 national insurance contributions for apprentices under the age of 25 from April 2016, building on the removal of employer class 1 national insurance contributions for all under 21-year-olds from April 2015.
Amendments to section 9 and new section 9B of the Social Security Contributions and Benefits Act 1992 and the Social Security Contributions and Benefits (Northern Ireland) Act 1992 give effect to the Government’s intention to abolish employer class 1 NICs for apprentices under the age of 25. From April 2016, employers of apprentices under the age of 25 will pay a zero rate of secondary class 1 NICs on the earnings of those employees, and that zero rate will apply to earnings below the upper earnings limit.
As my right hon. Friend the Chancellor made clear, apprenticeships are at the heart of the Government’s drive to equip people of all ages with the skills valued by employers. This measure is intended to support employers who provide apprenticeships to young people by removing the requirement that they pay secondary class 1 NICs on earnings up to the upper earnings limit for those employees. The measure is also intended to support youth employment. Under this Government, employment is at its highest ever level while unemployment is now lower than when the Government came to power. However, there is more to do to tackle youth unemployment and ensure that no one is left behind.
The amendment provides a zero rate of employer class 1 national insurance contributions on the earnings of apprentices under the age of 25 from 6 April 2016. The measure will apply to both new and existing apprentices aged under 25 and is not time limited.
The main features of the clause are, first, that there is a regulation-making power to define “apprentice”. There are existing statutory definitions relating to apprenticeships. For example, in England and Wales, the Apprenticeships, Skills, Children and Learning Act 2009 introduced the concept of an apprenticeship agreement, which is defined in part with reference to “an apprentice”. Because education and training is a devolved matter, and because not all apprentices are employed under apprenticeship agreements, we will need to look at the approaches taken towards apprenticeships in the different devolved Administrations. The power will allow time to discuss the definition with interested parties such as the Skills Funding Agency and their devolved equivalents. The power will also enable us to respond simply to changing statutory definitions and requirements in future.
Secondly, there are regulation-making powers to vary the age group to which the zero rate of secondary class 1 NICs for apprentices applies. For example, the Government could in future allow for an increase in the age bracket of apprentices falling into the zero rate earnings band of secondary class 1 NICs.
Thirdly, there is a regulation-making power to ensure that the benefit of the zero rate of secondary class 1 NICs for apprentices can be enjoyed only in respect of earnings below a certain level. In other words, the power will provide a means to introduce an upper secondary threshold for apprentices in the same way as we are doing for under 21s. That threshold will be set at the level of the upper earnings limit in the 2016-17 tax year.
The Government’s objective is to make all apprenticeships world class. Around £1.5 billion is spent annually to support apprenticeship training, and the Government are committed to driving up the quality of apprenticeships. We are currently taking forward a number of reforms that will have a positive impact. The Government believe that the measure will, alongside other initiatives on apprenticeships and the abolition of employer’s NICs for under 21s from April 2015, help to address the problem of youth unemployment in the UK.
I hope that, with that explanation, the House will accept the amendment made in the other place.
Shabana Mahmood (Birmingham, Ladywood) (Lab)
I am grateful to the Minister for introducing Lords amendment 1, which was the main amendment made in the other place. As he said, it enacts the announcement made in the autumn statement that employer national insurance contributions for apprentices aged under 25 will be abolished from April 2016. The Opposition support the measure. There is agreement on both sides of the House and across party political boundaries that we need more apprenticeships; and that youth unemployment, and long-term youth unemployment, remain a problem not only for the individuals involved, but for the economy as a whole. We hope the measure helps to alleviate that somewhat.
The Minister said that there is a regulation-making power within the measure for the definition of “apprentice” and referenced the 2009 Act definition, which relates to an apprenticeship contract. That concern was raised in the other place when the measure was debated. Will he give the House more information about progress in discussions with the devolved legislatures about the definition to be applied? How confident is he that the provision will not be manipulated in a way that enables a reduction by companies of their tax liabilities? The lack of a definition of “apprentice” causes concern that that might arise.
The current quality of apprenticeships has come under scrutiny in this Parliament. A recent report from the Department for Business, Innovation and Skills showed that 15% of apprentices are paid below the national minimum wage, and that 28% of level 2 and level 3 apprentices who do not have a written contract are paid below the national minimum wage. We also know that one in five apprentices receive no formal training. Will the Minister consider a stipulation on quality when he looks at the definition of apprentice? That would go some way to alleviating some of the concerns raised about potential gaps in the measure that could lead to abuse, or to a proliferation of apprenticeships that are not of a high quality and that do not add too much to the future prospects of the young people engaged in them. It would be helpful to hear the Minister’s further comments on those points.
Mr Gauke
I welcome the hon. Lady’s support for the measures. It is worth noting the considerable progress made on apprenticeships under this Government. We have created 2 million apprenticeships during this Parliament; they are giving young people the skills they need to succeed in the global race and get on in life. That is significant progress—progress on the number of apprenticeships has been considerably faster than was previously expected. For example, the previous Prime Minister, the right hon. Member for Kirkcaldy and Cowdenbeath (Mr Brown), said in 2008 that he intended to have 90,000 more young people taking part in apprenticeships by 2013. He said that, together with opportunities for those in their 20s and older, that would mean 220,000 people starting an apprenticeship each year overall. In 2011-12, 520,000 people started an apprenticeship, so we can see that there has been dramatic progress. The measure helps us to pursue that policy yet further.
Jim McGovern (Dundee West) (Lab)
I am intrigued as to how the Minister will define an apprenticeship these days. I was an apprentice in the construction industry. I served a four-year apprenticeship from the age of 16 to the age of 20. My father had to sign my indentures to say that I was indentured to that company, and possibly sold into slavery in a way. What is an apprenticeship these days? The Minister talks about half a million new apprenticeships, but are they apprenticeships as I understand them?
Mr Gauke
The hon. Gentleman goes to the heart of the question asked by the hon. Member for Birmingham, Ladywood (Shabana Mahmood) about who will qualify for the relief. As I have remarked, we are taking a power to define apprenticeships. Given that this is a devolved matter, it is important that we discuss it with the devolved Administrations. We want to support apprenticeships and will seek to achieve a broad definition for the purposes of the relief. However, the apprenticeship system across the UK is complex and evolving. Education and training is a devolved matter. Apprenticeships operate slightly differently in England, Scotland, Wales and Northern Ireland, and there are differences between Government-funded apprenticeships and independent employer schemes. The Government will discuss the definition of “an apprentice” with the Skills Funding Agency and its devolved equivalents before committing ourselves to a final definition. It is important that the definition is robust, satisfying minimum compliance standards while achieving the objective of supporting the provision of apprenticeships to the under-25s.
In terms of overall support for apprenticeships, the Government have done a great deal. We spend about £1.5 billion annually to support apprenticeship training. In Budget 2014, £170 million of additional funding was made available for apprenticeship grants for employers in 2014-16, providing a grant of up to £1,500 per apprentice for small businesses. The new budget will fund more than 100,000 additional incentive payments for employers to take on young apprentices.
It is also worth pointing out that in 2012 the National Audit Office recognised the strengths of the Government’s apprenticeship programme, highlighting how it continued to be valued by learners and businesses. It concluded that public spending on apprenticeships offered a good return, estimated at £18 for each £1 of Government investment. Evidence from the Department for Business, Innovation and Skills suggests that returns may be higher, at £28 for every £1 of Government investment. I hope Members will resist the temptation to criticise the substantial progress that has been made on apprenticeships over the course of this Parliament. It has been significant.
On the definition of apprentices, which I touched on earlier, there will need to be discussion with the devolved Administrations and the Skills Funding Agency. We want a robust definition, but we have to bear in mind the complexities in this area.
On eligibility, for a business to be eligible to work with training providers to create an apprenticeship programme, the employer offering an apprenticeship needs to employ an apprentice for a minimum of 30 hours per week, pay at least the national minimum wage for apprentices, support on-the-job learning and be involved in reviewing their progress. On the question raised by the hon. Member for Birmingham, Ladywood regarding manipulation, I would make the point that those safeguards are in the system.
One further point I believe is important is that, as the Government are doing with employment allowance and under-21s from April this year and as we did when we came to office and increased the threshold before employer national insurance contributions is paid, we have done a great deal to reduce the burden on businesses of employer national insurance contributions. That has helped in creating the substantial progress in employment we have seen in recent years. Had we pursued the policy we inherited—an increase in the jobs tax—we would not have seen that progress.
Steve Baker (Wycombe) (Con)
On reducing the burden on business, the Government have previously considered the notion of merging national insurance. Has the Minister made any progress down that line? I am acutely aware that national insurance still creates the impression that people have contributed to a fund out of which benefits are paid, when of course they are mostly pay-as-you-go. Can we reduce the burden on business, simplifying national insurance by simplifying the overall tax system?
Mr Gauke
My hon. Friend raises an interesting point in this context. He is absolutely right that the Office of Tax Simplification recommended we looked at that. There is quite a lot going on in relation to payroll: devolution of income tax in Scotland, the auto-enrolment of pensions and the introduction of real-time information to the payroll system. They have caused considerable challenges—all for good reason; all are doing much to improve the tax system—and we have held off pursuing further integration of income tax and the national insurance contributions system.
My hon. Friend was right to raise a point about people’s understanding of the tax system and greater transparency. The Government have introduced tax summaries so that people can see how much they are paying in income tax and national insurance. That brings greater transparency to our tax system, so we have made progress on that front. On the integration of national insurance and income tax more widely, it remains a position we continue to review. Some evidence from internal reviews was that the benefits to business of bringing the two systems together were perhaps not as great as some outside commentators had anticipated. In those circumstances, we did not want to rush into this matter, but I assure my hon. Friend that we continue to keep it under review.
Steve Baker
Will the Minister remind me whether tax summaries include employers’ national insurance? I am always conscious that when we are employees we must generate an amount of value for our employer somewhat greater than even our gross pay, so is employers’ national insurance contribution also reflected in the summary? If not, could it be?
Mr Gauke
There is a reference to employers’ national insurance contribution. The tax summaries state how much is paid in income tax and in employees’ national insurance contributions. There is also a line in the summaries saying, “Your employer has paid this much employers’ national insurance contribution.” Returning to the issue directly before us in relation to apprenticeships, there is an argument—I think a lot of economists would make this point—that ultimately the burden of employers’ national insurance contributions is taken up by the employee, as they receive less in salary as a consequence. There is also a case that it may be a disincentive for employers to take on employees.
We believe this sensible and well-targeted measure will encourage businesses to take on apprentices. We have not focused particularly on the limit, but there is provision to prevent manipulation such as the classifying of premier league footballers as apprentices, which might result in a 24-year-old footballer paying no NICs on a salary of £1 million. We have sought to address such abuses.
George Hollingbery (Meon Valley) (Con)
Will the Minister develop that point a little by saying exactly how many apprentices he thinks the change will encourage?
Mr Gauke
We anticipate that there will be about 3 million apprenticeships over the course of the next Parliament. The provision will come into effect in 2016-17. Not every apprentice is under 25, so not every apprentice will benefit from the provisions, but a large number of apprentices in the next Parliament will benefit.
Overall, we estimate that about 180,000 employers offering apprenticeships in the UK are likely to benefit from the measure. Apprenticeship data from the Department for Business, Innovation and Skills for England for the 2013-14 academic year show that about 500,000 apprentices under the age of 25 are employed throughout the country, and we estimate that about 130,000 apprentices in England are aged 21 to 24. That group will be directly affected by the measure, with those under 21 already benefiting from the zero rate for under-21s from April this year. I hope that information is helpful to the House.
Many Members were delighted by the Chancellor’s announcement on apprenticeships in the autumn statement, which demonstrated, yet again, the Government’s commitment to apprenticeships. If we wish to succeed in the global race, we need a well-educated and well-trained work force and to support employers who provide the training and experience that young people need if they are to be more productive and effective and more likely to make a substantial contribution to the economy.
Quite rightly, we often debate how to improve living standards, but ultimately it is down to improvements in productivity. As the economist Paul Krugman said—I do not often quote him:
“Productivity isn’t everything, but…it is almost everything”.
As part of our long-term economic plan, one measure we are taking to improve productivity is ensuring a well-trained work force, and encouraging apprenticeships is key to that. It is yet another aspect of our long-term economic plan. It will help us improve our productivity, and as productivity increases, so too will wages, salaries and living standards.
George Hollingbery
Will the Minister elaborate on the Government’s own productivity and on whether our investment in apprenticeships has been compared with other possible investments in productivity?
Mr Gauke
My hon. Friend makes a good point. As I said, the Government invest about £1.5 billion a year in apprenticeships. In its 2012 report, the NAO suggested that for every £1 spent in this area, we got a return of £18, and studies by the Department for Business, Innovation and Skills suggest that the return might be even greater: £28 for every £1 invested. Therefore this offers good value for money. Our policy on apprenticeships is an additional step, and I am delighted that the tax system can be used in this way. Once again, it demonstrates that the Government are on the side of those who wish to work hard, improve their skills and get on in life.
With those remarks, I hope that the House will agree with the Lords amendment.
Lords amendment 1 agreed to, with Commons financial privilege waived.
Mr David Burrowes (Enfield, Southgate) (Con)
On a point of order, Mr Speaker.
Mr Speaker
I think we shall treat of the hon. Gentleman’s point of order afterwards.
Mr Speaker
In that case, we shall come later to the hon. Gentleman. I am saving him up. It would be a shame to squander him too early.
Clause 2
Consequential etc power
Mr Speaker
With this it will be convenient to consider Lords amendments 3 to 5.
Mr Gauke
This group comprises four minor technical amendments to clause 2 and schedule 1, which deal with simplifying the collection of class 2 national insurance contributions payable by the self-employed.
It might help the House if I briefly outline the four amendments. Amendments 2 and 3 are the Government’s response to the report, published on 27 November, by the Delegated Powers and Regulatory Reform Committee on the delegated powers contained in the Bill. The report drew to the House’s attention the power in clause 2 to amend primary and secondary legislation as a consequence of the reform of class 2 NICs. This power is currently subject to the negative procedure. The Committee said that the justification in HMRC’s “Delegated Powers Memorandum” was not sufficient for the negative procedure to apply where the power allows for the amendment or repeal of primary legislation, and the Committee recommended that in this instance the power be subject to the affirmative procedure. The Government have considered and acted on the Committee’s report. Lords amendment 2 provides that regulations made under clause 2 that amend or repeal primary legislation be subject to the affirmative procedure. Lords amendment 3 provides that the negative procedure will continue to apply to any use of the power set out in clause 2 where a statutory instrument does not contain any regulations amending or repealing primary legislation.
Lords amendments 4 and 5 are minor technical amendments dealing with the simplification of the collection of class 2 NICs payable by the self-employed. This is a matter that I have previously debated, if not at great length, with the hon. Member for Birmingham, Ladywood (Shabana Mahmood). Amendment 4 amends schedule 1, which inserts new section 11A into the Social Security Contributions and Benefits Act 1992. It will ensure that the relevant self-assessment penalties apply to class 2 contributions collected through SA by adding a missing reference to the SA under-declaration penalty contained in schedule 24 to the Finance Act 2007. It was always the Government’s intention to align penalties for class 2 contributions more closely with those for SA as part of the reform of class 2 so that the self-employed are not subject to two different regimes, but this penalty was unintentionally omitted. Lords amendment 5 makes a corresponding amendment to the Social Security Contributions and Benefits (Northern Ireland) Act 1992.
With that explanation, which I know the House was keen to hear, I hope it will agree with the Lords amendments.
Lords amendment 2 agreed to.
Mr Speaker
It is always a joy to hear the Minister develop the argument, but he is exercising a self-denying ordinance. I must say that the way he has addressed matters thus far—comprehensively and courteously, in his usual manner—has been accompanied by a slight increase in the number of Members present for the next business. It is not for me to suggest that those two phenomena are causally related, but some people might think they are. I suppose if one is in a tight corner and hoping that the Minister will develop the arguments fully, one can always best depend (a) on a Treasury Minister and (b) on a lawyer, and he is both.
Lords amendments 3 to 5.
Mr David Burrowes (Enfield, Southgate) (Con)
On a point of order, Mr Speaker. Has any consideration been given to disapplying Standing Order No. 16(1), which allocates 90 minutes to consideration of the mitochondrial donation regulations? When similar regulations, concerning embryo research, came before the House in 2000, some 3 hours and 19 minutes were taken. Through the usual channels, the House has previously disapplied Standing Orders when dealing with issues of great significance, not least in this area. Obviously, many are concerned about the significant impact of these regulations, not least in respect of mothers at risk of passing on serious diseases to their children. This matter is of great significance to the country, because, for the first time in the world, we would be permitting human germ-line genetic modification. Given the significance of these matters, not just for those in the House but for the public, and in the interest of considering them in detail, I would have thought these matters deserved fuller debate and scrutiny, although I respect the fact that we will be turning to a general debate on rural phone and broadband connectivity afterwards. Given all that and the significant safety and legal issues, as well as ethical issues, surely we need longer than 90 minutes. Has any consideration been given to disapplying Standing Orders?
Mr Speaker
I am grateful to the hon. Gentleman both for his point of order and for his usual courtesy in notifying me in advance of its intended content. I am very sympathetic to the hon. Gentleman, but I fear—I say this in all sincerity—that I am unable to help him. The hon. Gentleman is right that it is within the power of Ministers to propose an extension of time available for a debate to which the 90-minute limit under Standing Order No. 16 applies. Notice is required, and there is no such motion on today’s Order Paper. I am clear that that is extremely regrettable, so far as the hon. Gentleman is concerned and many other Members may feel likewise. But we are where we are. In practical terms, the possibility of proposing such an extension is in the hands of the Government business managers, and is not available to Back Benchers.
The hon. Gentleman knows my views about the importance of empowering Back Benchers, and I have never been much fussed about empowering Ministers in any Administration, as the hon. Gentleman knows. Obviously, however, the Speaker has to operate within the established procedures of the House. As far as I can see—I have taken advice on the matter—today’s business must therefore conclude after an hour and a half.
The Minister is always a most courteous Minister, and she will have taken note of what has been said. Knowing the Minister as I do, I know she is planning to be pithy in her remarks to facilitate the majority of Back Benchers. About 18 Members wish to speak in the debate. If Members help each other, it will maximise the number of contributors. I fear we will have to leave it there for now.
Human Fertilisation and Embryology
(9 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Parliamentary Under-Secretary of State for Health (Jane Ellison)
I beg to move,
That the draft Human Fertilisation and Embryology (Mitochondrial Donation) Regulations 2015, which were laid before this House on 17 December 2014, be approved.
Mitochondria are present in almost every cell in the body and produce the energy we need to function. This is why they are often referred to as “the battery pack” of the cell. Unhealthy mitochondria can cause severe medical disorders, known as mitochondrial disease, for which there is no cure. The techniques provided for by these regulations offer the only hope for some women who carry the disease to have healthy, genetically related children who will not suffer from the devastating and often fatal consequences of serious mitochondrial disease.
First, I would like to bring the House up to date with the process followed since the principle of mitochondrial donation was first debated by Parliament during the passage of the Human Fertilisation and Embryology Act 2008 in 2007-08. There has been much consideration of this issue in this Parliament. Over the last five years, there has been extensive engagement and consultation with the public on this issue, including an ethical assessment by the Nuffield Council on Bioethics in 2012; a public dialogue and consultation exercise carried out by the Human Fertilisation and Embryology Authority in 2012-13; and a public consultation on draft regulations carried out by the Department of Health in 2014.
There have been three reports on the safety and efficacy of mitochondrial donation techniques by an expert panel convened by the HFEA which were published in 2011, 2013 and 2014. The expert panel members were selected for their broad-ranging scientific and clinical expertise, and for having no direct or commercial interest in the outcome of the review. Indeed, Professor Frances Flinter, a genetics consultant who works with affected families, has said:
“There has been more scientific review of this proposed process than any other medical technology.”
Robert Flello (Stoke-on-Trent South) (Lab)
The Minister says that there is no point in further review, but the safety tests recommended by the HFEA in its three reports have not yet been completed, written up or peer reviewed. Does that sound like a completed analysis?
Jane Ellison
I will come to that point in my remarks.
There has been much parliamentary scrutiny of the proposals, including three parliamentary debates and over 200 parliamentary questions in both Houses. As part of this parliamentary scrutiny, the Science and Technology Committee held an evidence session on mitochondrial donation in October last year. Following the hearing, the Chair, the hon. Member for Ellesmere Port and Neston (Andrew Miller) who I see in his place, wrote to me on behalf of the Committee, expressing the opinion that there was sufficient information for Parliament to make an informed decision, and urging the Government to bring forward regulations. Given the extensive scrutiny in this Parliament, I believe it is right to allow this Parliament to decide whether to take the next step for mitochondrial donation, which can progress only with these regulations.
The two proposed techniques, maternal spindle transfer and pro-nuclear transfer, are covered by the regulations. They are about replacing the battery pack that contains a small number of unhealthy genes with a healthy battery pack. Mitochondrial DNA is just 0.054% of our overall DNA and none of our nuclear DNA, which determines our personal characteristics and traits and is not altered by mitochondrial donation.
I would like to take this opportunity to pay tribute to the scientists at Newcastle university, who have led the world in the development of the new techniques—an area where Britain is at the forefront of life sciences.
Robert Flello
The Minister is extremely generous with her time. She says that these scientists are leading the way, but is she not aware of the work done in China over a decade ago in exactly this area? It was clearly pioneering, and it led to the Chinese Government outlawing the use of these techniques because of the appalling, tragic outcomes.
Jane Ellison
I am aware of that work, which has been the subject of extensive parliamentary questions. The expert panel considered all of those issues, including that piece of work, during the course of their deliberations.
Mr David Burrowes (Enfield, Southgate) (Con)
Does the Minister acknowledge that scientists broadly accept that the procedures are nuclear cell transfer? That is what regulations 4 and 7 make clear. That means that nuclear DNA in the egg is explicitly altered. Therefore one has to agree that an honest, clear definition of what we are dealing with is genetic modification.
Jane Ellison
No, I cannot accept that description. I recognise that my hon. Friend has objections to the procedure, but I do not recognise his description. Nuclear DNA is not affected; mitochondrial DNA is different.
As well as paying tribute to the scientists at Newcastle university, I want to pay tribute to the Lily Foundation, a charity founded by families who have lost their children to serious mitochondrial disease, and who have shown us the human suffering behind this scientific advance. Many right hon. and hon. Members, like me, have constituents who are affected, and I am sure that some Members will talk about such families in their own speeches.
Steve Baker (Wycombe) (Con)
Does the Minister accept that a person born as a result of a mitochondrial replacement would not pass on mitochondrial disease to their successors? In other words, the germ line would have been modified so that the mitochondrial disease had stopped with their parents. It seems to me that if she accepts that the germ line has been modified, what she said a few moments ago cannot possibly be right.
Jane Ellison
We have made it clear that the removal of the faulty mitochondria will be passed on to the next generation. That is exactly what we have been describing, but I do not accept my hon. Friend’s description of it as genetic modification. It has to be said that there is no universally agreed definition of genetic modification, but for the purposes of these regulations, we have used a working definition and it involves not altering the nuclear DNA.
Jane Ellison
I know my hon. Friend is going to make her own contribution. If she will forgive me, I want to outline for the benefit of Members less familiar with the regulations their detailed content.
Turning to that detail, the regulations are made under the powers in the Human Fertilisation and Embryology Act 1990. They were added to in 2008 to permit mitochondrial donation to prevent the transmission of serious mitochondrial disease, anticipating the advancement of science to this point. Regulations 3 to 5 set out the circumstances for mitochondrial donation techniques using eggs; regulations 6 to 8 set out the circumstances for mitochondrial donation using embryos. They would allow the use of the two techniques that have been subjected to extensive UK-wide review and consultation: maternal spindle transfer and pro-nuclear transfer.
Regulations 11 to 15 and 19 set out the information that can be provided about a mitochondrial donor to any child born from the donation and information to that donor. Regulations 16 and 17 set out special provisions around consent that were identified through the public consultation process. These regulations apply UK-wide, and the devolved Administrations have been kept informed of development and progress.
Fiona Bruce
Does the Minister consider that the Government’s own regulator, the HFEA, was wrong to state, in a consultation document that “PNT involves genetically modifying a human embryo”?
Jane Ellison
I shall deal shortly with the regulatory regime that the HFEA would introduce. However, that and many other points have already been examined in great detail and responded to in great detail in parliamentary answers, to which I refer my hon. Friend.
Richard Fuller (Bedford) (Con)
It is clear to many of us who have spoken to our constituents that this procedure will make a huge difference to individual families. There is, in a sense, an ethical gateway to the framework that will allow the scientists and medical experts to move forward. Can my hon. Friend tell us why there appear to be a number of people who, for ethical and religious reasons, are quite close to agreeing with the Government but have not quite agreed yet, and have asked for more time?
Jane Ellison
I think that those Members may speak for themselves during the debate. No one would deny that this is ground-breaking science—it is—but there have been three expert panel reviews. What I am trying to demonstrate in my speech is that we have taken all the necessary rigorous steps towards the point at which Parliament can make an informed decision. I think it important to distinguish things that are knowable and on which Parliament can make that informed decision, and things that can only be known when we take the next step, which involves making the regulations. I hope that that is helpful.
Jane Ellison
I want to make a little progress, but I may take another intervention later. I am conscious that many Members wish to speak.
There has been much discussion of the safety of mitochondrial donation techniques. As I have said, three reports have been produced by the HFEA-convened expert panel during the current Parliament. On each occasion, the panel has concluded that there is nothing to indicate that the two donation techniques are unsafe. Although the panel has recommended that further experiments should be conducted, it expects such research to support the conclusions that it has reached so far.
In public discussion, there has been some misunderstanding of the term “critical”, which was used by the expert panel. That is helpfully clarified in the HFEA’s introductory briefing note, which has been endorsed by the panel and which makes it clear that the experiments could take place before or after the approval of regulations by Parliament. The chief medical officer sent a copy of the briefing note to all Members yesterday.
Sir William Cash (Stone) (Con)
Is my hon. Friend aware that there are profound legal reasons for believing that the regulations are ultra vires in respect of the primary Act—the Human Fertilisation and Embryology Act 2008—and are also in breach of the clinical trials arrangements that are set out in the European Union clinical trials directive? Does she understand that that allegation has been made, and what is her response?
Jane Ellison
The clinical trials directive applies only to medicines. It does not apply to embryology, so it is not relevant in this case.
Jane Ellison
I am sorry. I know that many Members wish to intervene, but I am trying to leave time for Back-Bench contributions.
If the regulations are passed by Parliament, the HFEA will introduce a robust regulatory process, as it has in other areas of fertility treatment. The regulations would also establish important safeguards through the HFEA’s own licensing procedures. Before licences could be issued to providers of mitochondrial donation, they would have to demonstrate that they could carry out the procedure safely and effectively. Each provider would need to be licensed, and treatment for each patient would be approved on a case-by-case basis. Decisions would be based on the scientific evidence and advice that were submitted to the licensing committee. The HFEA is highly respected across the globe as a model for the regulation of fertility and embryology treatments and research. Many other countries do not have such a framework.
I recognise that some Members disagree in principle with mitochondrial donation, and I respect their point of view, although I do not share it. To those who do not disagree in principle I have sought to demonstrate—as we have sought to demonstrate over the years of expert panel reviews and further consideration—that all reasonable and rigorous steps have been followed to reach the point at which Parliament can be asked to make an informed decision about whether to allow these techniques to be licensed on a case-by-case basis. It is a bold step for Parliament to take, but it is a considered and informed step.
This is world-leading science within a highly respected regulatory regime, and for the families affected it is a light at the end of a very dark tunnel. I commend the regulations to the House.
Luciana Berger (Liverpool, Wavertree) (Lab/Co-op)
The impassioned and thoughtful contributions to the public debate that we have heard in recent weeks and months are testimony to what a sensitive and complex matter this is. Only last night, an event held in Committee Room 10 was attended by hundreds of people who are interested in the debate, and we heard representations from both sides.
On the one hand, we have celebrated the triumph of science that these new techniques represent. It is thanks to years of pioneering research by the university of Newcastle on how we can prevent the transmission of genetic mutations that we are finally reaching the point at which we can consider using these transformative techniques in humans. We have within our reach the possibility of eradicating mitochondrial disease from families who have been blighted by it for generations: families who have endured a disease for which there is no cure, who have suffered daily battles with painfully debilitating symptoms, and who have sadly lost their children prematurely. Those families have had to face up to the risk, and perhaps the certainty, that to be a parent must come at the expense of a difficult and, in too many cases, painful life for their children. Not only would children born through such techniques be free of such conditions, but so would their children and grandchildren. This treatment would break a chain of misery that would otherwise have ruined generations of lives.
On the other hand, we are grappling with the serious ethical and moral questions that are raised by the proposed introduction of such techniques. Members have previously shared their anxiety about the uncharted territory in which we now find ourselves. The proposed regulations would make Britain the first country to legalise mitochondrial transfer, and scientists have acknowledged that there would always be a “leap of faith” the first time the technique was used.
Robert Flello
I think we need to dispel the myth that there will be a “first time”. This was done more than a decade ago. In its recent analysis, the HFEA ignored the Zhang study. The Minister is shaking her head. She has clearly not read the study, which showed that when the technique was first tried, triplets were conceived. One was terminated almost immediately—within 30 days—and, of the other two, one was stillborn and the other died as a result of miscarriage. That is the reality. This is not groundbreaking; it has been done before.
Luciana Berger
I shall be dealing with the expert panel reviews that have been conducted since the date to which my hon. Friend has referred.
It is right that we have had a chance to hear all the arguments and to give them full and proper consideration, but it is critical to the integrity of the decision that is eventually reached for the debate to be based on the facts. When debating matters such as this, we will naturally hear a number of contradictory assertions. I am sure that the Minister will reassure the House about any further issues that are raised during the debate.
Mr Donohoe
May I ask the shadow Minister a simple question? Is this a case of DNA being genetically modified?
Luciana Berger
I do not believe that that is what is being proposed, but I shall deal with my hon. Friend’s very specific point later in my speech.
Richard Drax (South Dorset) (Con)
I know from a meeting that I attended before the debate that the HFEA has said, “PNT involves genetically modifying a human embryo”.
Luciana Berger
That point was raised in an earlier intervention. I think it is clear from reports following reviews by the expert panel that it has already been specifically addressed, but I shall deal with it in more detail later.
Dr Julian Huppert (Cambridge) (LD)
There seems to be a lot of confusion between nuclear DNA and mitochondrial DNA. It might help the hon. Lady and the House if I point out that they have completely different origins. They have a different genetic code; they are not related. The origin of mitochondria is bacteria that were engulfed by cells. They are very different. The House should be aware of that.
Luciana Berger
I thank the hon. Gentleman for that clarification.
Many concerns have been raised, the first of which is that this process is being rushed through. Anyone who has been involved in the development of these techniques would disagree that this has moved quickly. Professor Doug Turnbull and his team at the university of Newcastle have been researching this for 15 years. It was over six years ago, back in 2008, that the Human Fertilisation and Embryology Act 1990 was amended to introduce the powers to allow regulations that would enable mitochondria replacement to take place to be brought forward. It was back in 2010 that researchers at the university of Newcastle developed the techniques to avoid diseased mitochondria being passed from a mother to her children. After another three years of consultation and review processes, the Government announced in July this year that they would be bringing forward the regulations to enable mitochondrial donation techniques to be used, and that is what we are voting on today.
Guy Opperman (Hexham) (Con)
The hon. Lady and I both attended the meeting last night, which was very productive and helpful. Does she agree that this is about choice for the families? I have constituents who have this particular disease and constituents who work at Newcastle university, and what we are trying to do is provide a scientific way forward, under a highly structured and licensed regime, to alleviate these particular families’ suffering.
Luciana Berger
I thank the hon. Gentleman for that intervention. It was clear last night when we heard from the affected families that they wanted that choice, and these regulations very specifically only apply to those families that are affected by mitochondrial disease.
Luciana Berger
I am going to finish my point, if I may.
In the intervening years the science and ethics of these techniques have been extensively debated. The Nuffield Council on Bioethics and the HFEA held extensive public consultations in 2012 and identified broad public support for the use of these techniques. There have been three expert scientific review panels—in April 2011, March 2013 and June 2014—all of which found no evidence to suggest that the techniques are unsafe for clinical use, and only last week a group of eminent scientists and experts in medical ethics, including Professor Sir John Sulston, Baroness Warnock and Sir Paul Nurse, wrote to The Times urging Parliament to approve the new regulations. They argued that the question parliamentarians must consider is not whether we would want to use this technique ourselves, but whether there are grounds to prevent affected families from doing so. I again reiterate what we have heard in the representations from families, and particularly women of child-bearing age: they want the opportunity to use these techniques.
Mr Bone
The hon. Lady is making a very good speech and is trying to make it balanced. She talked about last night’s meeting, which I understand went on for quite some time, and there has been a lot of debate outside this Chamber, but is she satisfied that we come here to the Chamber this afternoon with only 90 minutes to discuss this? Would it not be better if we were to withdraw this motion today and come back with more time to debate it next week?
Luciana Berger
Unfortunately, it is not in the Opposition’s gift to determine the time allocated for these debates. I would have welcomed further debate, and we had an opportunity in a previous Backbench Business Committee-initiated debate to discuss these matters.
Luciana Berger
I am going to make some progress, because I am conscious—referring back to the intervention of the hon. Member for Wellingborough (Mr Bone)—that we have limited time and many Back Benchers wish to contribute.
It is important to note that the use of these techniques will not be rushed into lightly if Parliament does pass them today, and specialist clinicians will then have to obtain a licence from the HFEA to use the techniques. We heard last night that this will only be in centres of excellence, and the HFEA will consider applications on a case-by-case basis.
We have heard concerns in previous debates that allowing mitochondrial donation is a dangerous road to start down, and that it could potentially lead to designer babies and parents being able to select the physical characteristics of their children. But we have also heard in the public debate that these fears do not take into account the fact that these regulations are very specific and cover only mitochondrial DNA, not the nuclear DNA that determine our physical characteristics. The legislation only permits the use of these techniques in the clearly defined situation of incurable mitochondrial disorders.
The fact that these techniques apply only to the mitochondrial DNA and not to nuclear DNA should provide further reassurance to those Members concerned that this process would result in “three-parent babies.” As we have heard, mitochondrial DNA only controls mitochondrial function and energy production. Importantly, nuclear DNA, which makes us who we are and determines appearance and personality, will not be altered by the techniques that we are discussing today.
The regulations clarify that a mitochondrial donor is not to be treated as a parent, by contrast with the legal position for sperm and egg donors, who are treated as people who would, or might, be the legal parent of a child born from their donation.
There are questions around the safety of these techniques. As we have heard, this technique has received unprecedented scrutiny by the HFEA’s specially convened expert scientific review panel. However, it is possible that side effects could emerge over time and scientists have acknowledged that there would always have to be a “leap of faith” the first time the technique is used in humans.
Sir Edward Leigh (Gainsborough) (Con)
On the question of safety, does the hon. Lady not consider it significant that the Food and Drug Administration in the United States said that it was not clear that the scientific procedures were effective and safe? The FDA, of course, refused to allow the use of Thalidomide while we did, and the rest, as they say, is history.
Luciana Berger
I understand that the FDA has written to the British press in the course of the last week to contradict that position. There is a very different political situation in the US, and there is a very different set-up there in terms of the FDA compared with here and what we are discussing today.
Angela Smith (Penistone and Stocksbridge) (Lab)
Does my hon. Friend agree that the fact is that any scientist would say that no technique is entirely safe but the risk in this case is very low indeed, and completely justifies the leap of faith she describes, which is in effect a further advance in the use of IVF technology—which itself was pioneered as a leap of faith in 1978?
Luciana Berger
My hon. Friend makes some very important points, particularly about the assessment of risk, which has been done extensively throughout this process.
The question is whether the benefits of preventing the transmission of mitochondrial disease, and the likelihood that children will continue to be born who will die in infancy, outweighs the risks of the techniques. The scientific community and the families experiencing mitochondrial disease say that they do; and according to research, almost 2,500 women in Britain of child-bearing age are at risk of passing the condition on to their children. It is now up to Members to decide whether they agree.
Mrs Cheryl Gillan (Chesham and Amersham) (Con)
I am most grateful to the hon. Lady for setting out a balanced case. Can she clear something up for me? I understand that there are two sources of mitochondrial disease: the DNA in the nucleus as well as the mitochondrial DNA. Can she confirm that mitochondrial disease from the nuclear DNA will remain in our population even after this treatment is licensed?
Luciana Berger
I hope the Minister might be able to address that in her response to the debate, with the support of her officials. It is not something I have been made aware of, and it certainly has not come up in any of the discussions or debates that I have attended.
I will now conclude, as I know that many Members wish to contribute. The research has been done, the reviews carried out and the experts and the public have been consulted. Time is precious for those parents at risk of passing on mitochondrial inherited disease to their children, and I believe that we must not delay any further.
Mr Speaker
Order. On account of the number of Members wishing to contribute to this debate, I must impose with immediate effect a six-minute limit on Back-Bench speeches. That limit will almost certainly have to be revised downwards, and I appeal to colleagues to help me to help them.
Fiona Bruce (Congleton) (Con)
I want to speak against the Government motion, and I draw the House’s attention to my alternative motion in part 2 of the Order Paper—page 54—although it is not votable.
Human mitochondrial disease is a dreadful condition and, as a caring society, we must do all we can to address it, and do so as sensitively as we can for those families affected by it. As a caring society, however, we must also do so in an ethical manner and with proper regard for safety. I believe that the regulations we are considering today fail on both counts—ethics and safety—and that they are inextricably interlinked.
Let me be straightforward: I do oppose these proposals in principle. However, that should not prevent my concerns regarding their safety from being given a fair hearing. One of the two procedures that we are being asked to sanction today—pro-nuclear transfer—involves the deliberate creation and destruction of at least two human embryos, and in practice probably more, to create a third embryo, which it is hoped will be free of human mitochondrial disease. Are we happy to sacrifice two early human lives to make a third life?
Sir Paul Beresford (Mole Valley) (Con)
I question my hon. Friend’s definition of “embryo”. We are talking about two ova being used to create one embryo.
Fiona Bruce
Let me put it this way. Some may take the view that at such an early stage of human life, it is acceptable deliberately to create human embryos to then destroy them. However, the truth is that once upon a time I was an embryo and so was every other Member in this Chamber.
This debate is about the principle of genetically altering—indeed, genetically creating—a human being, and no matter how well meaning the motives, and my heart goes out to the families with mitochondrial disease, this technique will not cure that disease. That answers the question asked in the intervention on the hon. Member for Liverpool, Wavertree (Luciana Berger), the shadow Minister. This technique will not cure that disease.
David T. C. Davies (Monmouth) (Con)
I am completely undecided on this issue. Can my hon. Friend tell me whether it is the case that any woman taking the pill could arguably be destroying an embryo? If it is the case, what is the difference morally between using this technology and using the pill?
Fiona Bruce
What we are talking about is a particular process, which we know—with certainty—will destroy embryos. That is what I am addressing. As I say, this technique will involve the permanent alteration of the human genetic code. The Nuffield Council on Bioethics, which was cited by the shadow Minister in support of her arguments, says that these techniques are
“a form of germline gene therapy.”
This alteration will be passed down generations. The implications of this simply cannot be predicted. However, one thing is for sure: as someone has said, once this alteration has taken place and once the genie is out of the bottle, and once these procedures that we are being asked to authorise today go ahead, there will be no going back for society, and certainly not for the individuals concerned.
Dr McCrea
Does the hon. Lady find it strange that while the shadow Minister was telling the House that we should support these regulations, she had no answer to the direct question she was asked by the right hon. Member for Chesham and Amersham (Mrs Gillan), and that all she could say was that she hoped the Minister would clear the matter up?
Fiona Bruce
I was indeed surprised, but in a sense that is why those who have made the case for much more parliamentary time and debate on this issue are quite right.
There will be no going back for society and certainly not for the individuals and children involved. My hon. Friend the Minister said that we have taken all rigorous steps before bringing this matter to the House, but it is profoundly concerning that the outstanding preclinical trials, as recommended by the HFEA panel, have still not been undertaken, written up and peer-reviewed. Will my hon. Friend confirm that, setting aside the completion of preclinical trials, there have been no clinical trials of these procedures, that there will be no clinical trials of them and that, in effect, if we pass the regulations the techniques will be applied to the creation of children without clinical trials? In other words, we will be approving uncontrolled experimentation—because there will be no controls—on children. In the absence of clinical trials, would that not effectively contravene EU regulations?
Robert Flello
There is a lot of muttering around the Chamber that there will be clinical trials, but there cannot be clinical trials because they would breach the EU directive.
Fiona Bruce
That is exactly the point I was about to make. As has been highlighted in a letter from 44 MEPs who have written from the European Parliament this week to the Secretary of State for Health, the EU directives—the European clinical trials directive 2001, which was confirmed by the 2014 directive in the same area—state:
“No gene therapy trials may be carried out which result in modifications to the subject’s germ line genetic identity.”
My hon. Friend the Minister indicated that in some way these particular procedures were excluded from these trials. That cannot be correct. The European clinical trials directive 2001 applies to clinical trials involving germ-line engineering. It applies to all clinical trials using medicine, and to these procedures. For the Department of Health to argue that it can move straight to using these procedures on children without clinical trials gives us, apart from anything else, one reason to vote against these regulations.
If anyone doubts that, Lord Brennan QC has given a legal opinion on these regulations, which is of central importance. He says:
“It is a well-established principle that EU law is to be interpreted…in light of the purpose, values, social and economic goals the provisions aim to achieve. Given that…both the Directive and the 2014 Regulation…ban any gene therapy trials that involve modification of the subject’s germ line identity, then it would clearly fall within their purposes and values to prevent their use in clinical practice of any procedure with that effect without investigation or trials first having taken place.”
I believe that this Government are at risk of infringement proceedings being brought against them if these proposals go ahead.
Mr Speaker
Order. I think Members thought that the hon. Lady had concluded her speech, but she has not. Let us have a courteous hearing for everybody. I call Fiona Bruce.
Fiona Bruce
Thank you, Mr Speaker.
Once we approve this procedure, where will it lead? The answer has to be that we stop here and say, “This is a red line in our country, as in every other country in the world, that we will not cross.” This is the place for that to be said. As MPs, we are accountable to the people of this country.
The Government’s own consultation in July 2014 received 1,857 responses, of which 1,152 were opposed to the introduction of these techniques. That has been confirmed by ComRes polling last weekend, which showed that more than twice as many people are against these proposals as are in favour—41% of respondents, compared with 21%. A third public survey, being conducted today on The Daily Telegraph website, shows that as of this morning 68% of the public oppose these techniques in principle. Do their concerns not deserve respect from those of us present here?
The truth is that the Government have not waited for the conclusion of trials, as they should have done, so that this House could make a fully informed decision, and that is wrong. Whether one ultimately approves or disapproves of these proposals, the right procedure on such a profound issue is for the elected representatives of the people of this country to have full information before being rushed into a decision, as we would be today if we voted for these proposals.
Andrew Miller (Ellesmere Port and Neston) (Lab)
The hon. Member for Congleton (Fiona Bruce) set out her case clearly and I respect her beliefs, but I do not agree with her conclusions. If we took them to the logical point, we would ban any intervention that introduces some part of one person to another. It would mean boycotting blood and organ transfers, simply because—[Interruption.] I listened with courtesy to the hon. Lady and I hope that my hon. Friend the Member for Stoke-on-Trent South (Robert Flello) will listen to me with courtesy. When these pioneering techniques started, nobody knew the answers for certain. People made judgments—scientific judgments—on the best available evidence, and it turned out that people’s fears were ill-founded.
The trials that have been undertaken on this work have led the scientific community—a powerful group of scientists with an extraordinary degree of knowledge in this area—to conclude that the risks are small but worth taking because the benefits on the other side of the equation are enormous. In all cases where there are risks, we need to consider the risks as against the benefits. I put it to the House that there are potential benefits for the about 2,500 families affected by mitochondrial disease up and down this nation, and they deserve our support. Of course we have to assess the risks, as we do with all risks, but that has to be done in a rational and balanced way.
Richard Drax
I am listening carefully to the hon. Gentleman. Everyone in this House wants the best for these families—there is no doubt about that—but it is the speed of the introduction of the regulations that concerns us. As for experimentation, I heard today that no trials are being carried out on primates, which are as close to us as can be. This process has proved successful on mice, but on primates—a standard part of this procedure, apparently—it has not been carried out, and that is interesting.
Andrew Miller
The hon. Gentleman makes an interesting point, but there are plenty of occasions when such tests are not carried out. In central Africa we have been testing Ebola vaccines without first testing them on primates, because the benefits outweigh the risks. We are in that position already. My hon. Friend the Member for Stoke-on-Trent South referred to research undertaken in China 10 years ago. He rightly said that that work took place, but I put it to Members of this House that the ethical and scientific rigour applied to experimentation in the UK far exceeds anything in China 10 years ago. Indeed, the technologies have also moved on to a very high degree since then.
Dr Huppert
Some critics of this approach have pointed out that this country would be the first to go ahead with it. Does the hon. Gentleman agree that we should be proud to be leading the world in medical treatments and that, as he says, we can provide some of the best ethical safeguards in the world?
Andrew Miller
The ethical basis on which science is conducted in this country is world leading. The hon. Gentleman is right to say that we should be immensely proud of the successes—again—of our scientific community in a range of life science disciplines. This one affects a very small group of the population but does so in such a profound way. Although there are issues that need properly regulating, the regulatory structure that we have created does that properly. The Minister was asked about, and indeed mentioned, the issues associated with designer babies. Of course this House would want to impose limits, but we are considering a specific set of regulations about dealing with mitochondrial disease—they do nothing else. I, for one, would not stand here to defend the concept of designer babies and people choosing eye colour and so on. Today, we are dealing purely with those terrible illnesses.
Andrew Miller
No, as it would not be fair on other people. In case colleagues have not seen them, let me commend the e-mails sent to all Members by the Muscular Dystrophy Campaign; Jonathan Kingsley wrote to us all, and the Lily Foundation has written to us all in very powerful language. Those people who have sat and listened to some of the families will understand, and colleagues who have constituents affected by mitochondrial disease will understand the message.
We are in a society where people are entitled to have their beliefs, and I respect those beliefs; everyone should be entitled to express their opinion. But this is about focusing on the needs of that small part of the population that I mentioned. I urge the House, in coming to a conclusion this afternoon, to think about those families, to focus on their needs and to set aside general beliefs in the overwhelming interest of that small part of the population who have suffered immensely and who have an opportunity at their disposal because of the extraordinary science that has been advanced.
Steve Baker (Wycombe) (Con)
I approach this subject with a considerable degree of humility, for two reasons. First, I will never forget meeting a family in my constituency whose child suffers from mitochondrial disease; there was both a haunting sorrow in that family and the hope that if these regulations are passed they will be able to have a child without this problem. Secondly, I am very aware of my own shortcomings in relation to biological science. As a chartered engineer, I am perhaps more competent in the physical sciences, and I do not mind admitting that I had to look up at least a few of the words in the regulations in order to understand them.
As I have listened to this debate, not only today but previously, I have wondered whether we have really reflected on how science proceeds, because scientific truth is not established by authority or by democratic vote; it is established, as Karl Popper put it, through “conjecture and refutation”—trial and error. Someone who reads Thomas Kuhn’s “The Structure of Scientific Revolutions” will discover that it is possible for quite large bodies of knowledge to be developed with errors in them. When those errors are corrected, the paradigm shifts—that is a term we have all heard. That is how science proceeds, through trial and error. The reality is that there will always be uncertainty in any scientific procedure.
When the Commons Library summarised the Nuffield Council on Bioethics’ review, the second point mentioned was this:
“The knowledge about these techniques is uncertain and could remain so for several generations—their use could potentially harm future persons.”
The hon. Member for Liverpool, Wavertree (Luciana Berger), speaking from the Front Bench, made the point that, broadly, the question before us was whether there was a reason to withhold these techniques from people. If there is a reason, it is that they may do harm to future persons. I will not support the measure because this is inherently uncertain. That uncertainty is an inherent part of science, and it is no good appealing to authority to try to resolve the question, because different authorities will disagree and there is no way to resolve those disagreements apart from through empirical evidence, which we can obtain only by experimenting on humans.
Graham Stringer (Blackley and Broughton) (Lab)
The hon. Gentleman is making a typically thoughtful contribution to this important debate. Does he not have to balance that uncertainty, which he points out fairly, with the 100% certainty that the children of mothers with mitochondrial disease will suffer?
Steve Baker
The hon. Gentleman is absolutely right, which is why I began by expressing the humility I feel on this subject as a result of meeting and having had a lengthy conversation with a family who face just that issue. I remind myself, however, that we are dealing here not with a cure for those who have already been born, but with ensuring that those who are subsequently born do not suffer from that disease. If we were discussing a cure for those already living, perhaps the circumstances might be different.
Steve Baker
Prevention certainly is better than cure, but the question is: at what risk? I simply accept that on the earliest stages of human life there is a space for conscience; we will have different beliefs, some of which will be religious, and it is a matter of conscience. There are noble reasons for disagreeing about that stage and about what is and is not legitimate risk taking with human beings.
The second point I wish to make is that in the course of this conversation there seems to have been what, at best, I could describe as semantic sophistry as to whether or not this process is genetic modification. As always, there is space for debate about the definition of terms, but the germ line is to be modified if these techniques go ahead. The Minister has stated that plainly—
Steve Baker
She nods, and I am grateful. If the germ line is to be modified, to me this is genetic modification. I heard the hon. Member for Cambridge (Dr Huppert) give a clear explanation of the separate origins, and he understands the science better than I do. But for me the key thing is not so much where these parts of the DNA identity of a person came from, but where they are now. Each one of us has our own particular DNA identity. This procedure changes only a tiny part of it, but, having changed it, we cannot know what the consequences will be. I know that families will be affected by the decision, but I have to say, with great sorrow, that, when it comes to human beings, this degree of uncertainty cannot be borne by my conscience and I shall be voting against the regulations.
Frank Dobson (Holborn and St Pancras) (Lab)
I have a sense of déjà vu, or perhaps déjà entendu. The objections that have been brought out today, and in previous discussions, about mitochondrial disease are identical to those that arose when Louise Brown was brought into this world at Oldham general hospital as a result of the risky work undertaken by Steptoe and Edwards and Jean Purdy. That was a risk that the scientists were willing to take and that Mr and Mrs Brown were willing to take.
Not long after I became a Member, Enoch Powell proposed a total ban on embryo research. I understand people’s ethical objections to embryo research, but if they object to something on principle, they do not need to add any other references to safety or effectiveness. If someone is opposed to it on principle, they are opposed to it, and I can respect that. When the Warnock report was published, this House had a creditable debate—to those who say that the House of Lords has a better quality of debate, I say that they should read its first debate on the Warnock report, and they might modify their views. All the things that are being said today were being said then, and all the things that were said in the debates about the establishment and development of the Human Fertilisation and Embryology Authority were the same.
In a previous speech, there were two novelties. One was that Robert Winston was being misquoted as opposing the proposal, which he cannot do any more as he actually wrote a full article in favour of it yesterday. The second was that US experts, some of the most distinguished experts who have written papers on the matter, were against it.
Frank Dobson
No, I will not give way, because I do not want to take up more than my allocated six minutes.
The question arises: will it be safe and will it work? The answer is that no one can make any guarantees, but that is the nature of scientific development. The thing to remember is that mitochondrial disease is horrible and that there is no treatment for it. I remind people that the team at Newcastle university did not start off with this riskier novel approach. It has been studying and trying to come up with treatments for mitochondrial disease for the best part of 20 years, and is still doing so now. Some 90% of its work is trying to come up with a treatment. The best that it has managed to come up with after all these years is helping parents cope with the horrible symptoms before their children fade away and die. As has already been said, the team has decided that if it cannot come up with a treatment—and it is still trying—it would be better to prevent the disease arising in the first place because prevention is better than cure. That is why I hope the regulations will be passed and handed over to the HFEA. Members should realise that it is a credit to this country and to this House that the HFEA was established. We must find a middle way between the free-for-all, which a few nutters want, and the total ban, which some others want because they are opposed to embryo research on principle.
The system that has been established is well regulated through the HFEA. Despite all the predictions to the contrary, there has not been a single scandal in all the time that the HFEA has been in existence. There has been no sign of a slippery slope. These people with great reputations at Newcastle think the time is right to take risks and to risk their reputations—
Frank Dobson
No, I shall not. Those people are taking risks, because if the treatment does not work, there will be those who will gloat—even, I am sad to say, Members in this Chamber. The parents are also willing to take the risks. Parents with children do not want this to happen again, and we have the opportunity to do something about it. The results are uncertain, but that is in the nature of both medicine and science. We cannot guarantee that it will work, but the people most involved in the matter and all the scientific advisory bodies in this country think that it will work, and we should take note of what they say.
Mr Speaker
Order. The time limit on Back-Bench speeches is now reduced with immediate effect to four minutes.
John Hemming (Birmingham, Yardley) (LD)
This is a difficult issue for everybody. I have a real difficulty with this, which is that I cannot see the difference between modifying mitochondrial DNA and nuclear DNA. Both are inherited, and both can prevent inherited diseases. If we agree to this as a process, we are, in essence, potentially agreeing to swapping a pair of chromosomes—[Interruption.] I know that we are not agreeing to it in law, but in practice the same arguments can be used to justify—
Andrew Bridgen (North West Leicestershire) (Con)
Will the hon. Gentleman bear in mind the fact that mitochondrial DNA only codes the mitochondria, which were undoubtedly alien DNA to the human cells, and actually were probably bacteria that are now symbiotically living within us?
John Hemming
I will not take lots of interventions because it would damage the debate. They remain inherited, and, in essence, we face the same difficulty. My concern is a legalistic one, which is that we are moving away from a society in which we value people as people to one where we start looking at people in terms of what categories they fall into and things such as that. To that extent, I cannot back the motion today, particularly as it is being pushed through in such a rush.
Robert Flello (Stoke-on-Trent South) (Lab)
The hon. Member for Birmingham, Yardley (John Hemming) almost caught me napping.
It would be ridiculous to suggest that anybody in this House does not want a cure for mitochondrial disease; it is a horrible disease. But if we understood properly how mitochondrial DNA worked, we might find ourselves closer to finding a cure for that disease. My right hon. Friend the Member for Holborn and St Pancras (Frank Dobson) said that we had heard all these arguments before. Well, yes, we did hear an argument before. It was back in 2007 when Members were marched through the Lobby to support the human-animal hybrid legislation. That legislation was going to solve numerous problems, and some Members said, “How could anybody dare to object to such legislation?” But what has happened to that legislation, that panacea? Well, nobody can get a grant for that work now because it has been proved that it does not work. All the concerns, hopes and heartache of the time got us nowhere. I really fear for the families today. If this motion passes today and it does become law, those families, who are, understandably, pinning everything on it, will be tragically let down.
Robert Flello
I will take an intervention shortly. Reference has been made to the Zhang study. That study was not considered by the HFEA. Even if we said that Chinese medicine is terrible and that 10 years ago it was irrelevant and not ethical, the HFEA should still have considered it, but it did not. A number of Members have claimed that mitochondrial donation is like blood transfusion—nothing more than that. Well, no it is not like that. It is modifying the human germ line. As the HFEA has said, maternal spindle transfer is genetic modification of the egg and pronuclear transfer is genetic modification of the embryo. Think about it, colleagues. Why are we in the Chamber today to discuss this procedure if it is not genetic modification? If changing the germ line is not genetic modification, we do not need the statutory instrument. The HFEA could get on with it. It has therefore answered itself.
Dr Huppert
I listened to what the hon. Gentleman said about hope, and he is right that we do not know how this will play out. There might be people who have hope who will not succeed. What I cannot understand is why he is saying that to avoid people having their hopes dashed later, we should dash them today.
Robert Flello
It is simply that this legislation will open up research that is illegal, as I shall describe in a moment. I also think there are greater concerns about generations down the line.
The EU clinical trials directive, which applies to all clinical work, states:
“No gene therapy trials may be carried out that result in modification to the subject’s germline genetic identity.”
The HFEA itself has said that this procedure does. In the legal opinion on the regulations, Lord Brennan QC has said that they are caught by the directive and that they are
“likely to be in breach of EU law”
on clinical trials.
The Department of Health examined the legal opinion but rejected it, saying that the licence will not be granted for clinical trial but for treatment and therefore will not be caught by that law. Apparently, this is not about clinical trials and furthering the science but about going straight for treatment.
Lord Brennan’s opinion anticipated that. He set out the relevant paragraphs from the 2011 report on safety from the review panel set up by the Secretary of State to monitor the procedures to the HFEA, which said:
“Once assessed as safe to use in clinical practice, the panel strongly recommends that permission is sought from the parents of the children born from MST and PNT to be followed up for an extensive period”
and that such permission should be sought from the children themselves once they are old enough. In the case of females, that should ideally be to the next generation. Those recommendations should also apply to pre-implantation genetic diagnosis for mitochondrial DNA genetic disease.
Robert Flello
I think they are doing that because the legislation on the EU clinical trials directive will be tightened up even more next year.
Until knowledge has built up that says otherwise, the panel recommends that any female born following MST or PNT should be advised, when old enough, that she herself might be at risk of having a child with a significant level of mutant mitochondrial DNA. The HFEA is putting that child and, if they are female, subsequent generations at risk.
I have only a minute left but my speech would cover more than that time. It is nonsense to try to ram through this statutory instrument in no time at all. This is not about whether we should be helping families afflicted by this appalling disease but about saying we should get things right. We should ensure that this is done properly, with proper parliamentary scrutiny. The ultimate role of Government is to protect the safety of the citizens of this country and the regulations do not do that. They open the gates to a procedure that is completely untested, with no pre-clinical trials or clinical trials. The regulations talk about going straight to treatment and that has all been done so that the Department of Health can wangle its way around the legislation, or so it thinks. This is terrible. It is not good for the families with this chronic, horrible disease. We need proper and considered research. If these regulations were on genetically modified crops, we would all be up in arms. That is what is happening here.
Mr Speaker
Order. I understand the widespread unhappiness about the time constraints, but we are where we are. I simply point out that Members are not obliged to take their full four minutes if they do not wish to do so.
Mr David Willetts (Havant) (Con)
I apologise to you, Mr Speaker, and to the House for missing the opening speech in the debate. Nevertheless, I was keen to speak because I think that the proposals before us today would tackle a real human need. There are parents who are currently bringing into the world children with a horrible disease and the suffering is made more acute by the fact that now, for the first time, prospective parents know that they could be doing this procedure and they therefore face the dilemma of whether or not to have children.
I realise that there are important objections. My hon. Friend the Member for Congleton (Fiona Bruce) put forward the ethical objection. I fully understand the fact that our benefit from this treatment does not of itself overcome the ethical issues, which are crucial. The red line to which she referred is, I think, a red line over which we have designer babies and change the DNA that makes the character of a person. I am persuaded by the scientific evidence that the mitochondria is not part of the core DNA that does that. In the previous debates and the previous legislation, it was absolutely clear that the red line that the House was trying to set was one that stopped the changing of human nature, and we do not cross it today.
Mr Willetts
It is absolutely true that mitochondria can be inherited through the mother, but it does not change the character of the baby.
Secondly, let me consider the health and safety objection. Sometimes that objection is being used as a cover for what is really an underlying objection in principle. The scientists say, with typical caution and care, that there is no evidence that this is unsafe. It is true that nobody can have 100% certainty about that, but there have been 15 years of research and seven years of scrutiny, including by various scientific bodies and ones promoted under this Government, and so far no one has been able to come up with a concrete and powerful objection that suggests that the process is unsafe. It is right for us today to be considering moving on to the next step.
Mr Willetts
Let me make some progress, as others want to speak.
Thirdly, I hear a rejection on the grounds that we are somehow rushing because we are going to be first. People ask, why us? Why now? Why in Britain? I must say, having had the privilege of serving as the Minister responsible for science, that we are first because we have world-leading research in this area. We should be proud of the fact that it is in British labs and British universities that this fundamental research is happening. It was in our country that the structure of DNA was discovered and I had the privilege of going to the Nobel prize ceremony for Robert Edwards, who won the Nobel prize for his work on IVF, which would properly not have passed through the levels of scrutiny we require of research today.
That brings me to my fourth and final point. What is our role in this Chamber today, faced with this very difficult question? We must make a judgment on whether any ethical issues stand in the way of tackling a clear human need. We are not agreeing that any specific programme of treatment should be licensed or should go ahead. We are very fortunate in this country to have a regulatory structure that is different from that in the US. In the US, if Congress voted for such legislation to go ahead, that would be the end of the matter. If we vote for the regulations today, as I hope that we will, we are saying that the HFEA can decide whether or not to license specific uses of mitochondrial DNA donation after it has assessed all the risks. There is that further safeguard. All we are doing is saying we require it to make that assessment and we are not objecting in principle. My sense of the mood of this House is that there are not many people who object in principle.
Andrew Bridgen
We yearn for Back-Bench debates and free votes and we have one today. However, I detect that those who perhaps have not studied the issue are going for the status quo, saying that there has not been enough time. Does my right hon. Friend agree that it would be disappointing if the regulations were not passed today because people had not done their research? It is rather like the case for a student who has not done his revision—the exam is always too soon.
Mr Willetts
We all know the feeling.
One thing we are proud of in this country and, I hope, on both sides of the House is our innovation, research and enterprise, provided that the risks are clearly understood and regulation is in place. I hope that we will support innovation, particularly innovation that tackles a clear human need.
We are not saying that this must go ahead today. We are saying that we trust a body to consider licensing it with very strict requirements, and on that basis I hope that the House will support this admirable measure.
Liz McInnes (Heywood and Middleton) (Lab)
As we have heard, mitochondrial DNA makes up a tiny proportion of our total DNA. Unlike nuclear DNA, it does not pass on any personal attributes; it is purely involved in the chemistry of energy production. That is why, when there is a defect in mitochondrial DNA, it tends to affect organs that require a high amount of energy, such as the heart, muscles, brain and liver. All of our mitochondria are inherited from the egg and, as we have heard, researchers have worked on techniques to replace faulty mitochondria using those from a healthy donor. To refer to that donor as a third parent, as some have, is something of a misnomer. There are 37 genes in mitochondrial DNA, which is less than 0.01% of our total DNA. Altering the mitochondria will not alter a child’s characteristics inherited from its biological parents, but it may provide a way to prevent a debilitating and sometimes fatal disease.
Fiona Bruce
I want to pick up on the point the hon. Lady makes about mitochondria not affecting characteristics. The Government’s own consultation document acknowledged that diverse characteristics are associated with mitochondria, including learning disabilities, neurological problems and dementia, and that every person’s symptoms are different. Is there not an insurmountable contradiction in saying that this is just like changing a battery if on the one hand one is saying that the aim is to prevent damage to those characteristics, but on the other hand one is saying that the techniques will not affect them at all?
Liz McInnes
I did not say it was just like changing a battery. In fact, I try to avoid using that terminology. The hon. Lady mentions learning disabilities, but as I just said, the organs affected the most by mitochondrial disorders are organs that require a large amount of energy, such as the brain, so that comes as no surprise to me.
Allegations have been made that the techniques are not safe.
Liz McInnes
No, I will not, because I need to make progress and let other people speak.
Last night, it was my privilege to attend the debate on the safety and ethics of this technique and to hear Professor Doug Turnbull, who leads the research team at Newcastle university, talk about the 15 years of work done by his team and the extensive safety checks that have taken place during those years. In the Chinese case to which my hon. Friend the Member for Stoke-on-Trent South (Robert Flello) referred, the treatment was carried out by an American clinician on a single patient in China. The patient became pregnant with triplets, one of whom was aborted and the other two were born prematurely and died. Importantly, the clinician attributed the outcome entirely to multiple pregnancy and obstetric complications, not to the method of conception. I do not accept that that one case represents a proper clinical trial.
What we have to remember is that mitochondrial disease is a life-limiting debilitating disease, causing severe distress to parents and their affected children. We have here a technique with the ability to alleviate their suffering and to allow affected parents the chance to have a healthy child who is genetically related to them in all aspects apart from a tiny proportion of mitochondrial DNA. The spectre of designer babies can be dismissed. There is no possibility of using this technique to select certain characteristics. It will simply allow mitochondria to function normally and for the child to be free of mitochondrial disease.
Liz McInnes
I will not, no.
In safety, the UK has a robust regulatory framework. A vote in favour of the motion will not in itself open the way for mitochondrial donation to be used in clinics. It will simply enable the HFEA to consider each individual family’s request for treatment on a case-by-case basis, taking expert scientific and medical advice and licensing the procedure only if the evidence shows that that is appropriate.
I am lucky enough to have worked at the Royal Oldham hospital, where the first IVF baby, Louise Brown, was born. When IVF was first introduced, there was no certainty that it was completely safe. Only after the first babies were born using the technique could scientists be completely reassured that their detailed research had led to the birth of healthy babies, but to this day research continues on IVF, just as more research must be done on mitochondrial transfer. That is the nature of science: it is a continuous process; it does not stand still.
For families affected by mitochondrial disease, this research has given them new hope that they may at last have the chance to bear a healthy child of their own. Last night I heard from a woman who suffered from mitochondrial disease, which had also affected her mother. That young woman had taken a considered decision not to have her own children, for fear of passing on the condition. The opportunity to have this treatment presents her and many other women in that situation with new hope. The science is there to alleviate the suffering of affected families, and in my opinion it would be unethical to withhold this treatment. I urge the House to approve the regulations.
Sir Edward Leigh (Gainsborough) (Con)
Everybody who is following this debate will of course have the most profound sympathy for families who are affected by these appalling diseases, and I quite understand why so many colleagues want to vote for the regulations to lessen human suffering, but I am afraid that I will oppose the regulations. I do so on three grounds: ethics, safety and the importance of parliamentary procedure.
On the first, ethics, I think what we are considering is a new step. It will affect the germ line. Mitochondria is inherited; it is not just another organ of the body. What is proposed is a fatal and important step. As my hon. Friend the Member for Congleton (Fiona Bruce) asked, where do we stop? Given the nature of the human condition, these appalling diseases, sadly, will occur, but where do we stop? What further modifications will we make?
My second ground for opposing the regulations is safety. Under European conventions and regulations and so on, we should have full clinical trials and the scientific community should be united on aspects of safety, which it is not. Unfortunately, we will be the first state in the world to authorise the technique, and in that sense, in bioethical terms, we will be in a unique position. We should ask ourselves why no other state—not in the EU, not the US, not yet anybody—thinks that this is proved to be absolutely safe.
As for the third reason for my opposition, it has been said that this is not a final decision, and that we are just handing it over to the HFEA, but this is the final decision; it is a monumental decision. For the first time, Parliament is saying that we authorise people to affect mitochondrial DNA. That is a monumental decision. This will now happen and colleagues who vote for the regulations must appreciate that.
For those three reasons—on ethical grounds, on safety grounds and on procedural grounds—I will vote against the regulations.
Jim Shannon (Strangford) (DUP)
I hold the Minister in the utmost respect, but I feel greatly aggrieved that we are discussing this matter today in the House and that the Government are pushing forward with legislation on a process that I believe is unethical and unproven.
When assessing the reports published by the Human Fertilisation and Embryology Authority, we must take into account the point that the expert panel comprises a small group of scientists convened by the HFEA. Hearing the tone of today’s debate, one could be forgiven for thinking that they represent world scientific opinion. I do not want the House to be hoodwinked into thinking that there is a consensus on this issue, because there certainly is not. In fact, numerous world-leading scientists have been at pains to express their concerns about the proposals.
They include Professor David Keefe of New York university medical centre, himself a pioneer of spindle transfer techniques, who said:
“the application of the…techniques…represent intriguing advances of earlier work, but displays of technical virtuosity should not blind us to potential hazards.”
He explains that his research group moved away from these procedures because
“vexing concerns linger about the safety of mitochondrial replacement”.
He is far from alone. Stem-cell scientist Professor Paul Knoepfler is so concerned that he wrote an open letter to Parliament urging caution on the ground that rushing ahead would damage the reputation of science as a whole. He concluded:
“Overall, the UK would most likely be making an historic mistake by allowing 3-parent technology to proceed in the near future. Please wait on this critical decision for the additional information needed to make a wise choice in the long run.”
Clearly, we need time. Australian expert Professor Justin St John calls for more tests in non-human primates, so that we better understand the possible effects of the techniques. He says:
“As well as analysing foetal development in a non-human primate model, it is essential to analyse offspring to determine that no abnormalities appear at least during early life”.
None of those figures objects to the ethics of the techniques. Their objections are based purely on the science. Lest we think that they are lone voices, it must be remembered that the United States Food and Drug Administration considered the techniques last year and decided that there was not enough preclinical evidence to justify proceeding. I understand that the same body has reopened the debate and has insisted that it will be at least two yeas before it is ready to make a judgment.
In that context, I find it extraordinary that the Government have not waited for the conclusion of the preclinical safety experiments that the HFEA said should be conducted before proceeding.
Dr McCrea
In her opening speech the Minister mentioned that the devolved Administrations had been kept abreast of these proposals. I wanted to intervene to ask her whether the regulations will apply in Northern Ireland if they are passed in this House. That is an important question to which an answer is needed.
Jim Shannon
I am glad my hon. Friend raised that point.
We cannot have a real debate today without the evidence. New Scientist, typically a champion of progress in all areas of research, warned of a lack of understanding of the links between mitochondria and nuclear DNA. The fact is that the procedures for creating children are so controversial that no other country makes legal provision for them. The Council of Europe convention on biomedicine expressly prohibited them. The fact that experiments recommended by the Human Fertilisation and Embryology Authority itself have not been concluded, written up and peer-reviewed raises extensive safety concerns. Yet we as parliamentarians are asked to make a decision today without having all the clinical evidence before us.
In the preclinical tests that have been carried out, one of the techniques was tried in humans and resulted in three foetal deaths. The obligations in international law, specifically the European directive on clinical trials—
Jim Shannon
I am sorry, I cannot give way. I do not have enough time.
The legal opinion of the Labour QC Lord Brennan seemed to suggest that the Government will not bother with clinical trials. That seems extraordinary and will come as a shock to many who spoke in favour in the debate on 1 September. My colleague Lord Morrow spoke to the Northern Ireland Attorney-General about the attempt of the Department of Health to argue in the response to Brennan that these regulations are not caught by the clinical trials directive, on the basis that the intention is to skip clinical trials. The Attorney-General told Lord Morrow that in his opinion the Department of Health is wrong and the regulations do indeed contradict the clinical trials directive. If the regulations go through today, they will contradict international law as well. The same point was made by 44 Members of the European Parliament. I urge the House to vote against the regulations.
Paul Burstow (Sutton and Cheam) (LD)
Mitochondrial disease shortens lives, causes serious disability and leaves heartache in its wake. Now, thanks to the world-class research led from the university of Newcastle, we have the potential of innovation in IVF that could make a real difference for thousands of families in this country.
We have not arrived at this moment of decision in a rush. This House made provision in the Human Fertilisation and Embryology Act 2008 for regulations to be brought to this House
“to prevent the transmission of serious mitochondrial disease”.
Since those debates there has been a lengthy process to consider the benefits, the risks, the ethical issues and public consent. All these matters should be carefully considered. What all this work has revealed is broad public, ethical and scientific support for approving mitochondrial donation.
Clearly, safety is paramount. That is why the procedure has been scrutinised on three separate occasions by independent panels of experts. No evidence has been found to suggest that these techniques are unsafe. Are they ethical? Mitochondrial donation does not alter the essential personal characteristics or traits. It gives the gift of freedom from mitochondrial disease. It does not confer on a third person the parenthood that has been claimed in this debate. It is not about a third parent.
I have received many e-mails and letters from constituents on both sides of the argument, and I understand and respect those who have principled objections to the approach. I was struck by what the Right Rev. Dr Lee Rayfield and the Rev. Dr McCarthy said in a recent letter to The Guardian:
“The HFEA has made clear that even if parliament were to permit these two techniques, no licences would be issued until there was sufficient assurance from expert reviewers that mitochondrial donation is ‘not unsafe’”.
For me, that assurance—
Paul Burstow
No, I must not. We must make progress.
That assurance from the HFEA is important. It means that although today is an important milestone in addressing mitochondrial disease, it is not the end. I was struck by what the Church of England said in its response to the HFEA’s consultation. The Church of England is not opposed in principle to these proposals. Its opposition is not absolute. It makes it clear that it is supportive in principle. As a Christian, I take heart from that.
For myself, I am persuaded that we make our decision today with the benefit of a thorough process, including thorough parliamentary scrutiny, and we have a robust regulatory framework. Today’s vote does not open the doors to mitochondrial donation as a matter of routine in clinics. Rather, we grant the HFEA the responsibility to consider on a case-by-case basis and weigh the expert scientific and medical advice. On every occasion safety and efficacy will be considered as a consequence of the regulations—the very concern that many hon. Members have cited as their reason for objecting to these proposals. I hope hon. Members will support them.
The Minister was right. This is about light at the end of the tunnel for thousands of families in this country. It is about the prospect of life lived, life realised, and about the potential opportunity to live.
Mr Speaker
With the leave of the House, it is proper that the Minister should have five minutes to respond. One last contribution, very pithily—Mr David Burrowes.
Mr David Burrowes (Enfield, Southgate) (Con)
We are here today to consider the regulations. The explanatory note says that the debate gives Parliament the opportunity to consider whether the new techniques are safe enough for use in a treatment setting. I said in a point of order at the start of the debate that I did not believe that we had had sufficient opportunity to make that decision today—sufficient opportunity, yes, to consider the passionate views of those mothers about whom we have heard today, who are at risk of passing a serious disease to their children, and also to consider on behalf of the country the prospect of our being world leaders in permitting human germ-line genetic modification. I say “genetic modification” because that is what it is. We need a clear and honest debate.
A number of scientists have accused the Government of dishonesty for trying to redefine what we are here for today, which is to debate whether to permit genetic modification. Only last week, the United States Institute of Medicine said that what we are discussing today are
“assisted reproductive methods involving genetic modification of eggs and zygotes for the prevention of mitochondrial disease.”
The HFEA, too, accepted honestly on its website that whether we go for PNT or MST, they are both genetic modification.
I do not know how many Members have read the regulations. This is not a wide debate about mitochondrial donation or about the principle. It is specifically about the regulations. They make it clear that the procedures entail a cell nuclear transfer, which alters the nuclear DNA in the egg that the DNA is transferred into. It is clear that mitochondrial DNA makes up part of the human genetic code. This technology that we are debating modifies that code by separating nuclear mitochondrial DNA. Regulations 4 and 7 make it clear that this is a complete transfer of nuclear DNA into the donor’s egg or embryo. The Government should admit that the interaction between mitochondria and nuclear material is not clear. We cannot say with certainty that these techniques will not affect the characteristics of children.
In conclusion, the Government said in their consultation response that this is about providing greater understanding of the ways in which mitochondrial DNA mutations are passed down from mother to child. In many ways it is an experiment, or a wider trial, and it is a trial that I do not think we should go ahead with. It is unprecedented in the world. Some might say that it is leading the pack, and others might say that it is leaving us out on a limb. Ethically, it breaks international norms. Legally, we have heard about the directive. With regard to safety, the tests are not yet complete. Members might think “Not yet” or “No”. Either way, please vote against the motion.
Jane Ellison
I will try to touch on some of the points raised in this high-quality debate, in which views have been expressed on all sides of the argument. I will deal first with the technical questions. I really cannot add to the excellent explanation that the hon. Member for Heywood and Middleton (Liz McInnes) gave of the Zhang et al study from China. She was precisely right and explained it very well.
In answer to an earlier question, we are satisfied that regulations are necessary and that they are not ultra vires. The clinical trials directive is not relevant in this context. It is part of a suite of EU measures that set out common rules across Europe to ensure the free movement of safe medicines in the EU. Mitochondrial donation is not a medicine, so those provisions do not apply. The follow-up assessment of the treatment’s efficacy is part of good clinical practice.
Jane Ellison
I am afraid that I cannot, because my role now is to respond to the points that have already been made.
On international support, Britain does not stand alone, as some Members have suggested. The Department of Health has recently received a lot of correspondence from researchers and scientists in Germany, France, the Netherlands, Sweden, Japan, Hong Kong and two states in Australia, all indicating support for UK advances on mitochondrial donation. It is also important to note that nobody is saying that scientists are of one voice or one mind on the issue, but the House should note that the overall weight of international scientific opinion is very much in favour of these techniques, and they have been looked at exhaustively.
Following the point made by my right hon. Friend the Member for Sutton and Cheam (Paul Burstow), I have today spoken to the right reverend Prelate the Bishop of Carlisle, who speaks for the Church of England on ethical matters in the other place, and with the Rev. Dr Brendan McCarthy, the Church’s national adviser on medical ethics, and they have told me that I can confirm that the Church is not opposed in principle to mitochondrial donation.
We have discussed germ-line therapy, with Members disputing definitions of genetic modification. The HFEA agrees that these techniques are germ-line therapy, but it has also agreed with the Government’s working definition that mitochondrial donation is not genetic modification; but I accept that others will have a different view, because there is no international or universally accepted definition.
With regard to the techniques being successfully performed in non-human primates, I can confirm that maternal spindle transfer is a technique developed in the US that has been performed successfully in non-human primates. Lord Brennan’s comments on the regulations were made to the Joint Committee on Statutory Instruments, which did not draw any special attention to his remarks. In answer to my right hon. Friend the Member for Chesham and Amersham (Mrs Gillan), the regulations will not prevent mitochondrial disease caused by faults in nuclear DNA; the techniques make no alteration to nuclear DNA.
It is really important, in the seconds remaining, to point out to those Members who have said that we are rushing, and that it is open season on all these things, that that is not true. It is defined in primary legislation that the regulations can apply only to serious mitochondrial disease. There is no slippery slope. I looked back at the debates in the House on IVF all those years ago, when some were worried about a slippery slope, and all the safeguards are still in place more than two decades later. I think we can give the House confidence that we have considered this very carefully and that there is enough information. As I have said before, this is a bold step for Parliament to make, but it is a considered and informed one. We have world-leading science set in a well respected regulatory regime. For many families affected, this is indeed the light at the end of a dark tunnel. I commend the regulations to the House.
Question put.
Robert Flello
On a point of order, Mr Speaker. We have just had a 90-minute debate during which a number of right hon. and hon. Members from across the Chamber and with different views had to rush through their speeches. We had people putting on the record views—sometimes genuinely held views although not necessarily correct—that nobody was able to challenge. Some hon. Members did not even have the chance to contribute to the debate.
Could you confirm, Mr Speaker, that there were indeed hon. Members who indicated that they would have liked to speak? Secondly, do you think it right that we have had a 90-minute rush and will now have three hours on a Backbench Business Committee motion?
Mr Speaker
I thank the hon. Gentleman for his point of order, and I confirm that two hon. Members who wished to speak were unable to do so. I expressed sympathy at the start of the debate for the hon. Member for Enfield, Southgate (Mr Burrowes) who would have preferred a longer allocation of time, but I must operate within the rules and procedures of the House. It is also fair to emphasise that 12 Back-Bench Members representing different viewpoints were called. That is the factual answer.
The hon. Member for Stoke-on-Trent South (Robert Flello) invites my view as to the propriety or otherwise of this matter, and I can say only that we have operated entirely in accordance with procedure. There has been no impropriety and nothing disorderly. I understand that some people are discontented, but I hope people will not take offence if I say that to a degree, I think there will always be people who are discontented. It is difficult to get unanimity on these matters, either on the merits of the issue or on the procedure. However, I think we have done our best, and people have done their best today to help each other, which is worthy of note.
Jim Shannon
Further to that point of order, Mr Speaker. It is obviously of great concern to many Members of the House that only 90 minutes was allocated for that debate, and you outlined at the beginning that the Minister could control that. What advice would you give to Back Benchers who want to ensure that in future, if there are debates about such enormous change for the whole United Kingdom, we can ensure a three-hour debate rather than a 90-minute debate?
Mr Speaker
I am always happy to offer my advice to the hon. Gentleman, but whether he takes it or not is entirely up to him. The short answer is twofold. The hon. Gentleman is an assiduous attender of debates—indeed, I have often wondered if he sleeps here overnight because he is invariably present in the Chamber at all times and for every Adjournment debate. First, he should always turn up at business questions when he can raise such matters with the Leader of the House. Secondly, if he feels that Back Benchers should have a greater say in the allocation of time on matters of this kind, he might want to join forces with other hon. Members who are championing the creation of a House business committee. That was to be introduced by the third year of this Parliament, but I think it momentarily slipped the Government’s memory and therefore has not happened. It might happen in the next Parliament, however, and I have a feeling that the hon. Gentleman might be a cheerleader for it. We will leave it there.
Mr Speaker
I will come to the hon. Gentleman—how could I not?—but first of all, I will take the point of order from Sir Paul Beresford.
Sir Paul Beresford
Further to that point of order, Mr Speaker. The hon. Gentleman that introduced the point of order has conveniently forgotten that he spoke in the Back-Bench debate on just this cause, as it is in his case. He was one of the leading Members at that debate.
Mr Speaker
Well, that was—dare I say it?—a meaty point of order, or even a toothy one, but it was certainly a useful point of order and I am grateful to the hon. Gentleman. We must not delay indefinitely, but we must take Dr McCrea.
Dr McCrea
Further to that point of order, Mr Speaker. There is general dismay among many Members, and I am sure among our constituents, that we could get only 90 minutes in this House to debate a decision of such magnitude, and hand it over to others to take the decision forward, without parliamentarians having the final say, and yet we have three hours on the next motion, a general debate on rural phone and broadband connectivity. Only one Northern Ireland Member was able to speak, and he had to rush through his speech, and yet we find out that the legislation applies equally to Northern Ireland, where a devolved Government cannot stop it, as in other regions of the United Kingdom.
Mr Speaker
I always listen to the hon. Gentleman, and I hope to every Member, with courtesy. I hope he will not take offence when I say that that point was made in the course of the debate. If the Leader of the House wants to respond, he can, but we must operate in accordance with our rules. Members would rightly complain if we did not or if I did not.
We will have to leave it there for today. I thank all hon. Members both for their contributions to the debate, and of course for their points of order. I thank the Minister for her courtesy and consideration of other Members in terms of her own taking up of time.
Business without Debate
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Backbench Business
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Rural Phone and Broadband Connectivity
(9 years, 10 months ago)
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Jesse Norman (Hereford and South Herefordshire) (Con)
I beg to move,
That this House has considered rural phone and broadband connectivity.
Whatever the pros and cons of the argument on the length of the previous debate, on which views are widely held, shared and disputed, it is entirely appropriate that we should have a three-hour debate on rural phone and broadband connectivity, which is important to many people in this country. The debate follows one in Westminster Hall on 6 January. That debate was only 30 minutes long, but the Minister and I took 11 interventions. I am delighted by the turnout of colleagues on both sides of the House in the Chamber today. I specifically thank the Backbench Business Committee for its support in allowing us this time. I pay tribute to the Environment, Food and Rural Affairs Committee for its excellent reports on rural communities, which was published last year, and on rural broadband and digital-only services, which was published just this morning.
Before Christmas, I surveyed more than 1,100 people living and working in my constituency in Herefordshire on mobile not spots. The overwhelming majority felt that that was a serious or very serious concern to them. Local businesses feel exactly the same way. In one recent survey in Herefordshire, almost 98% of local business responded to say that they had specific problems with mobile coverage.
Mark Field (Cities of London and Westminster) (Con)
My hon. Friend will appreciate that my seat is anything but rural, but the self-same problems of not spots relating to broadband connectivity affect even our biggest cities. As many will recognise from complaints by their staff, that applies even here in the Palace of Westminster in this part of SW1. I accept that this is a rural debate, but the issue affects the whole of the UK.
Jesse Norman
I am very grateful to my hon. Friend for making the very important point that while these are especially difficult issues in rural areas, they are not confined to them. If it is possible to have a problem with mobile connectivity in SW1, I invite him to consider what it is like in HR1.
The issue is not merely bad mobile and broadband coverage, but the compounded effect of both, especially on isolated communities in rural areas such as my own. To take just one example, Vodafone recently acknowledged to me that it has only 55% coverage for 3G mobile data services in Herefordshire. Is it any wonder that bad connectivity is such a source of continuing frustration?
Mr Graham Stuart (Beverley and Holderness) (Con)
I do not mean to trump my hon. Friend, but I met Vodafone last week and its current 3G coverage in my constituency is just over 20%. The good news is that thanks to the Government announcement of additional funding, it plans to reach 99% by the end of 2017.
Jesse Norman
I invite colleagues across the House to engage in our new sport: the four Yorkshiremen of mobile coverage. If anyone can beat my hon. Friend’s figures, he or she is welcome to intervene.
In the previous debate, I focused on the basic unfairness of bad coverage and connectivity, and on its disastrous economic and social effect. I highlighted the situation at Kingstone surgery, which had such a bad signal that without urgent repairs it was going to be unable to upgrade its software, potentially affecting 4,200 patients in a matter of weeks. I have since spoken to Herefordshire council and met BT again. I am delighted to inform the House that obstacles have been overcome and that the surgery is scheduled to receive a fast broadband service on 18 February, just in time for its upgrade.
Mr Nigel Evans (Ribble Valley) (Con)
Does my hon. Friend understand the frustration of the residents of Gisburn and of Councillor Richard Sherras? The farmers who live in the small rural village of Gisburn have been told to diversify—bed and breakfasts, working from home and so on—but broadband connectivity is so bad that the chances of even watching something on BBC iPlayer is non-existent, never mind trying to run a business. Indeed, a number of farmers are expected to do their returns online, which is impossible in Gisburn.
Jesse Norman
Councillor Richard Sherras is rarely far from my thoughts. My hon. Friend’s point is illustrated perfectly by a business in Blakemere in my constituency with the wonderful name of Wiggly Wigglers. Wiggly Wigglers was set up 25 years ago in 1990 by fantastic local dynamo Heather Gorringe. It has become an award-winning example of local entrepreneurship. It began with composting worms and garden products, and has now diversified into flower delivery. It has 11 employees, nine of whom are women. It is a perfect example of the kind of higher value-added rural business that constituencies in rural areas across the country seek to emulate, but it is totally reliant on online sales— Blakemere is a village of 63 people. In Heather’s words:
“Our other services are pretty rubbish…A bus goes by once a day, our rubbish is collected once a fortnight, our roads are full of potholes, our train services impossible.”
Indeed, last year, the B road was cut off for a month and one day, and her husband Phil pulled out 39 cars and other vehicles from a chest-high flood. This is the reality of rural broadband compared with other services, and their broadband service has got steadily worse over the past few years, not better.
Sir Robert Smith (West Aberdeenshire and Kincardine) (LD)
I thank the hon. Gentleman for bringing this important debate to the House. He is highlighting how crucial it is for rural businesses and farmers to have good connectivity, but another important message is that good connectivity reduces the pressure on the road network, because people can work from home and not overstretch the commuter roads. The roads around Aberdeen, for example, are already overstretched.
Jesse Norman
That is an important point. In Herefordshire, we certainly suffer from a lack of connectivity, both road and mobile, so the hon. Gentleman makes a good point.
David Rutley (Macclesfield) (Con)
Characteristically, my hon. Friend is making an impassioned speech on behalf of rural communities. We are fortunate in Macclesfield in that some communities have received broadband in recent years, but we now need to get to the isolated villages—places such as Wincle, Wildboarclough and Kettleshulme. One thing that has not come out in his fantastic speech so far is that this affects not just businesses but school children trying to do their homework. We have to ensure that whole families and communities, not just businesses, can access the services they need.
Jesse Norman
That is absolutely right. We are looking at a concatenation of problems, economic and social, across all age groups.
Richard Drax (South Dorset) (Con)
I am listening with interest to my hon. Friend’s passionate speech. May I add culture to the list of things that are missing out? In Kimmeridge, a remote part of South Dorset, they will be building, with lottery money, a new museum for fossils collected over 30 years by Mr Steve Etches MBE. They were promised broadband for this new, all-singing, all-dancing museum in 2016, but they have now been told that they are not going to get it. The effect on this small community is devastating.
Jesse Norman
I am sorry to hear the case my hon. Friend describes, but it is emblematic of a much wider problem. I certainly share his view that culture should be added to the list of deficits created by lack of coverage.
Mrs Cheryl Gillan (Chesham and Amersham) (Con)
May I say how supportive I am of my hon. Friend in bringing this debate to the House? Does he agree that there are other problems, such as those experienced in my constituency? In particular, we have been told that it is not commercially viable to upgrade the Great Missenden cabinet 11 to superfast broadband. Also, Connected Counties told us that cabinet 6 in Beaconsfield would be upgraded, but although we started inquiries in the middle of last year, it is not expected to deliver until the end of this year. Surely it is terrible for people to have to wait that long.
Jesse Norman
There is many a slip between cup and installation of rural cabinet. I know that the Minister will have those boxes firmly in his mind when he responds.
Bill Wiggin (North Herefordshire) (Con)
One of the saddest stories I have heard from my constituents in Fownhope is that on Monday mornings they get texts from their children’s schools telling them what matches they should have turned up to on the previous Saturday. It is the failure to provide broadband and a mobile phone signal that is causing the greatest difficulties in my constituency. I hope the Minister will keep the pressure on BT. It is delaying the connections that would enable the use of other types of telephone signal in the absence of sufficient broadband width on which companies could base their rural solutions.
Jesse Norman
My hon. Friend is right to focus on the combined effect of lack of mobile and broadband connectivity.
It is testimony to the importance of this debate that the House is so full, especially on the Government side of the argument. I am delighted that the Minister, who is not yet the Samson Agonistes of his Department, has retained his beard for this important debate. We must pray he never loses it and, in particular, that it confers the strength required to see this vital project through to its natural conclusion—and certainly that if he does lose it, he does not lose it to the mobile operators.
Responding to my debate on 6 January, the Minister stressed the huge investment in and the tremendous progress the Government are making on broadband and superfast broadband, and on improving mobile communications. He is absolutely right, and I pay tribute to him and the Secretary of State, but he acknowledged that there were still issues—how could there not be—with implementation, and it is on implementation that I believe this debate should focus. I shall pick three key areas of implementation.
The first concerns partial mobile not spots, about which so many Members have spoken. I welcome the agreement recently reached between the Government and the mobile network operators, but it would be helpful to have some detail from the Minister on what specific steps he is taking to ensure that areas with multiple communications problems—of the kind highlighted by my hon. Friend the Member for North Herefordshire (Bill Wiggin), which also exist in my constituency—can be prioritised for improved coverage.
The Government also need to focus on the worst-hit areas and not merely allow the operators to target the easy wins. If I may, I will tentatively offer a suggestion. Perhaps the Government might consider initiating or promoting a means by which rural communities could petition their councils for mobile services as a signal of interest to the operators and as a trigger for a fast track through the planning process. We need that kind of change if we are to get adequate roll-out to some of the more remote areas.
Karen Lumley (Redditch) (Con)
Does my hon. Friend agree that it is not acceptable for Mr Washington of the Lenches in Redditch to have less than 2 megabits to run his business?
Jesse Norman
One can only hope, depending on his business, that once the upgrade goes through, Mr Washington will have considerably more than 2 megabits—enough to allow him not merely to run his current business, but to expand it into all kinds of other value-added areas.
My second area of focus concerns the mobile infrastructure project. The situation, it is fair to say, has, after initially high hopes, become disappointing and frustrating. When the sites to benefit from the mobile infrastructure project were first announced in July 2013, the ambition was for them to be acquired and built this year. That has now slipped—officially, at least—to spring 2016. Ten sites were identified in Herefordshire alone, but to date only two in the country, not just in my county, have been delivered. This is a vital area for the Government to focus on.
I very much welcomed the Minister’s announcement on 6 January that the mobile infrastructure project masts would now run 3G and 4G antennae, which is a great step forward. He said that
“we have put a rocket under the MIP”.—[Official Report, 6 January 2015; Vol. 590, c. 69WH.]
Could he be a bit more specific? What we need now is a schedule of all the sites that Arqiva plan to develop, a detailed explanation of what barriers exist to getting the plans delivered and a plan from the Department to recover costs from Arqiva if the contract can no longer be delivered.
Geoffrey Clifton-Brown (The Cotswolds) (Con)
I met a group of constituents living at Yanworth in my constituency last weekend, who rely solely for their businesses on satellite technology, which is very slow. They have no broadband whatsoever, so should we not concentrate on the 10% that are harder to reach? I wholly commend what my hon. Friend has just said about the MIP rolling out broadband, so that we can use that for mobile technology at the same time.
Jesse Norman
It is to the Government’s credit that they have recognised the importance of the last 10%, 8% and 5%. Some will require bespoke solutions because those people live in such remote areas. We should allow technology to play its role in whatever form is required to deliver the signal that they need.
Mr David Heath (Somerton and Frome) (LD)
This concept of the last 10% and the last 5% is what worries me. There is a saying in rugby clubs nowadays that the London Irish are known as the “not nots” because they are not London and they are not Irish. We have the same things with “not nots” in the rural population: people who do not get broadband, do not get mobile phone coverage and do not get the other infrastructure. They are simply left out. It is no good saying 90% or 95% are getting it, if the last 5% are always the same people—those who are living in rural areas.
Jesse Norman
My hon. Friend is absolutely right about that. I guess I was making a different point—that no one should be left out, but that it may be the case that specific demands have to be met by specific technologies.
Daniel Kawczynski (Shrewsbury and Atcham) (Con)
As a Member of Parliament from a neighbouring county to my hon. Friend’s, I know that we are acutely aware in Shropshire of the problems affecting our rural communities. I would like to hear his views on this issue. We had to set aside money from our local enterprise partnership in order to deal with broadband issues. Does he agree that such money should come directly from the Government rather than requiring us to set aside money from LEP projects that should be funding other things?
Jesse Norman
My hon. Friend’s constituency and mine have the same LEP, so we are both affected by the problem. I believe it is within the scope of LEPs to top up existing money if they think that matters are not proceeding quickly enough. I only wish that they were proceeding more quickly and more thoroughly, in a way that would meet the need that my hon. Friend has described.
Guy Opperman (Hexham) (Con)
Does my hon. Friend agree that we need a change of emphasis from the Government? Instead of improving broadband quality for those who have some broadband—which, by and large, is their current policy, on a value-for-money basis—should they not focus primarily on areas with no broadband, so that real progress can be made?
Jesse Norman
I am not sure that my hon. Friend’s characterisation of the Government’s policy is correct, although that may be its effect. However, the principle of addressing the needs of people who have no digital connectivity is absolutely right, and is a crucial feature of the debate and of my argument.
Sir Peter Luff (Mid Worcestershire) (Con)
My hon. Friend is making an excellent speech, and I am sorry to intervene on him yet again. Does he share my concern about the performance of BT Openreach, whose spectacular failure to connect houses in the new development at The Orchards in Evesham has appalled me? Many other such houses are occupied but still have no broadband connection. Has the time come for us to consider the legal separation of BT Openreach from BT itself?
Jesse Norman
At the risk of prolonging my own remarks, my hon. Friend has managed to read my mind. I plan to end my speech by focusing specifically on Openreach and the problem that he has described. As Members will know, Openreach is BT’s network infrastructure arm. I have been flooded with complaints about Openreach and its poor customer service, as, I am sure, have Members on both sides of the House. The problem is compounded by a lack of direct accountability to end users, and, I might add, to Members of Parliament.
Tessa Munt (Wells) (LD)
I could not agree more. It seems to be impossible to contact Openreach. When I eventually forwarded a string of e-mails to the Minister, they were incomprehensible. The position was utterly unclear.
Jesse Norman
I assume that the hon. Lady means that the response from Openreach was incomprehensible, rather than the e-mails that she received from her constituents. [Laughter.] That is a vital clarification. I cannot comment on the quality of the e-mails, but I can absolutely identify with those who are experiencing those problems, and, indeed, with my constituents who have experienced them as well.
This is a highly profitable business whose network expansion has been significantly de-risked by lots of cash from taxpayers. I should like to see much more openness towards end users, a public commitment to higher standards of service, and, potentially, an opening up of the network so that other operators can offer enhanced services, including customer service—if not, indeed, the possibility of full separation. I should be grateful if the Minister would add his voice, and his enormous authority, to this issue.
Julian Smith (Skipton and Ripon) (Con)
In the short term, Openreach could do a great deal by pushing forward with its “fibre to the node” technology, which is an issue that the Minister has been working hard to solve. The technology could reach many of the communities to which my hon. Friend has referred, and BT and Openreach could do much more in that regard.
Jesse Norman
My hon. Friend is right. Nodes need fibrous connections.
Access to fast broadband and mobile services is not a luxury or a game, but a necessity. It is vital to the successful work of businesses in our constituencies and the social well-being of our constituents—all the more so in rural areas, isolated as they are. Connectivity presents the possibility of a long-term renaissance in our rural economies, but we need continued, concerted and resolute action to deliver it. That action must come from the telecommunications industry, from the Government, and from the regulators.
John Woodcock (Barrow and Furness) (Lab/Co-op)
I congratulate the hon. Member for Hereford and South Herefordshire (Jesse Norman) not only on securing this debate, but on the wonderfully persuasive and erudite way in which he opened it, which makes me slightly trepidatious about following him. [Interruption.] That is most kind. I also congratulate the Backbench Business Committee on finding the time for us to debate this hugely important issue.
Even the urban parts of my constituency suffer economically from the geographical remoteness of our corner of Cumbria. My constituency includes small villages and one of the Lake district’s most remote valleys, which all Members should take the time to discover—not, perhaps, before 7 May, but at any time after that. Good-quality broadband connections are vital for local businesses trying to compete with those in more densely populated areas, for our sizeable tourist industry trying to make the most of our stunningly beautiful area, and of course simply for local residents who want to use the web at something better than the prehistoric speeds that so many of them have to cope with.
Over the last two summer recesses I travelled around my constituency by bike, sitting down with local residents in front rooms, village halls and cafes to talk about whatever issues mattered to them, and time and again—whether in Broughton, Kirkby, Leece or Great Urswick—the issue of broadband speeds came up. Many residents knew they had been promised great things by the Government in terms of rural broadband but had not seen the fruits of that.
Ministers have certainly talked the talk over recent years and some parts of my constituency are getting broadband which is much better, even if they believe, rightly, that the description “superfast” is overegging the pudding, but for too many other areas the reality on the ground simply has not changed. There is no great use in our revisiting here the fiasco of the bidding process for rural broadband, but the delays that led to it are still dragging on, leaving thousands of my constituents relying on broadband speeds of barely 1 megabit per second. In the village of Ireleth alone, 500 households are struggling along on that sort of speed. Hundreds of others in neighbouring villages are seeing similar glacial broadband speeds. The residents and I are becoming increasingly sceptical about BT’s promises—the hon. Member for Hereford and South Herefordshire eloquently made this point—to upgrade the local exchanges and ensure these villages get the 21st century service they deserve and need.
Let me give my own experience to demonstrate this point. On 14 October last year my office received an e-mail from BT stating that the exchanges at Broughton-in-Furness and Greenodd, which serve most of the rural areas of my constituency, would be upgraded during the winter of that year. That was excellent news, but then, after Christmas, another constituent from the area contacted me about their very slow broadband. I wrote to BT again. On 21 January, just three months after I was told something quite to the contrary, BT responded that
“there is no date available by when this will be ready.”
BT understood, the e-mail went on to say, that its supplier, Openreach, had met its target of delivering fibre optics to two thirds of the UK and that anything further would be a matter for funding by the Government’s broadband fund. This is another example of it washing its hands of this situation and the clear responsibility of providing acceptable broadband speeds for my constituents.
The Minister for Culture and the Digital Economy (Mr Edward Vaizey)
Will the hon. Gentleman acknowledge in the course of his brilliant speech—which easily passes muster with that of my hon. Friend the Member for Hereford and South Herefordshire (Jesse Norman)—the £43 million that has been invested in Cumbria under this programme and the 119,000 premises that should get superfast broadband under it?
John Woodcock
Yes, money has been invested, and where it has come in, it has been welcome, but it has been too slow, it has not met the promises of delivery which the Government themselves set out and there are still too many areas that have got nothing at all, and they are tearing their hair out. As I am sure the Minister will accept, it is my responsibility to speak up for those people in the House today. On that note, will he agree to meet BT with me, so that it can explain when faster progress will be made and when it will meet the promise that it so clearly made?
Mr Heath
I recognise what the hon. Gentleman is saying. We have made good progress in Devon and Somerset in terms of the BT contract, but there is still the last bit. If I may say so, it is pointless meeting BT, because it simply will not deliver in those areas and what we need to look at now is other smaller providers filling in the bits that BT will never reach.
John Woodcock
The hon. Member makes a good point but BT should not be let off the hook on this, because it has made assurances to my constituents and to others that it has not delivered on.
Mr Vaizey
Of course I will meet the hon. Gentleman. Although it is a great hostage to fortune to say so, I make it a matter of principle that I will always meet any Member who requests a meeting to discuss this issue. And while I am on my feet, I will also say: Devon and Somerset, 300,000 premises and £92 million.
John Woodcock
Of course I will give way to my hon. Friend the shadow Minister; perhaps he could come along to this meeting too.
Chris Bryant
Will my hon. Friend point out to the Minister that just spending money is not a success, and that success is when—[Interruption.] Well, it is about time you lot learned that. It is when broadband is actually delivered that there is a success.
John Woodcock
I am afraid that I cannot agree to my hon. Friend the shadow Minister’s request because he has already eloquently put the case himself, and I would be a pale imitation of him if I were to try to follow.
Perhaps we should not be all that surprised that so much of rural Cumbria is seeing such slow progress towards superfast broadband. Many of the areas that I have spoken about have yet to see any significant progress at all with the earlier technology of mobile connectivity.
Tessa Munt
I wonder whether the hon. Gentleman has had the same difficulty as I have had in extracting the information from BT as to which areas will not be covered by it. Accessing that information would at least allow the people affected to make alternative arrangements with a satellite company. I do not know whether he has managed to find some way of getting such information about his area, given the difficulties that I have had.
John Woodcock
The hon. Member makes a great point—the situation is a nightmare. As I have just set out, often when someone receives assurances, they prove not to hold water. BT is a company that we would think would be good at communicating, but it turns out that for too many of our constituents, who are really tearing their hair out about this issue, BT has proved to be the exact opposite.
That has got to change, and either BT changes its ways itself—in response to the threat of other companies coming in—or, if I might offer the Minister some advice, the Government embrace the idea that they need to be more active in this sector. They had a tremendous example of a lean, active state, which was provided by the later years of the last Labour Government, and this is an excellent opportunity for them to learn from those years and adopt the same approach in their own dealings.
I turn to mobile connectivity. In the Duddon valley, if someone gets one bar of reception, they count themselves lucky. Again, this situation makes running a business tricky, or completely impossible, because it cuts off communities and in a remote area it also has serious safety implications. It is perhaps odd to think of mobile coverage as the next frontier after superfast broadband, but there has been little apparent interest from commercial companies in improving coverage for much of my constituency, and I am sure that the same is true of many other Members’ constituencies.
Any movement on this issue is welcome, but with the greatest of respect to Shropshire, Dorset and Norfolk, pilot schemes in those areas do not mean much to my constituents in Cumbria or impress them very much, if at all. Many of my constituents also look askance at the Government plans to improve rural mobile coverage based on A roads and B roads. My constituents in Seathwaite, for example, are 3 miles from the nearest such road, hidden behind a 2,000 foot hill, so such plans are not likely to help them much. We need more ambition, not a brief flurry of activity because the Prime Minister could not get any mobile reception on his way to Cornwall.
Bob Stewart (Beckenham) (Con)
My constituency is an outer London one. It is not rural, but it is nearly rural. We have A roads going through, and there are huge problems, not just in Keston in my constituency, but throughout Bromley, particularly as one goes towards Orpington.
John Woodcock
May I suggest to the hon. Gentleman that perhaps the way to get a quick solution would be to get a visit from the Prime Minister, a big fan of his, to his patch. It seemed to trigger the promise of action, if not the reality of it, when the Prime Minister was on his way to Cornwall. One never knows what could happen.
For too many of my constituents, no mobile reception and super-slow broadband are not just a holiday inconvenience; they are a fact of everyday life that impoverishes them and holds them back from reaching the enormous economic potential that my region has. Let me make one final request of the Minister, as he was so kind in agreeing immediately to my first one. Will he come to the beautiful Duddon valley—he had better come quick, given the election on 7 May—in my constituency? When he has finished admiring the scenery, will he try to do some work there for 24 hours, without meaningful broadband and with no mobile reception? Perhaps then—if he can properly appreciate how difficult it is to get anything done there—we will see some quicker action to tackle the mobile and broadband deserts afflicting too many in my patch.
Daniel Kawczynski (Shrewsbury and Atcham) (Con)
I pay tribute to my hon. Friend the Member for Hereford and South Herefordshire (Jesse Norman) for his excellent speech, eloquently making points about matters affecting his constituents in rural parts of Herefordshire. Needless to say, many villages in Shropshire are facing similar problems. Let me highlight the village of Pontesbury, the largest village in my constituency. As Members of Parliament are inviting the Minister to go all over the UK, let me invite him to the village of Pontesbury, an important and large village just to the south of Shrewsbury, where it is extremely difficult to get any mobile phone coverage. We have mentioned local businesses, schools and children needing to do homework and other things on computers, and this problem really is holding this village back significantly, so I am pleased to hear about the progress the Government are making.
Mr Vaizey
Perhaps I should clarify that when I am accepting invitations for meetings from colleagues I am happy to have them in the House. Let me also say that I hope that my hon. Friend will acknowledge the £28 million invested in superfast broadband in Shropshire, covering at least 50,000 premises—20,000 have already been reached.
Daniel Kawczynski
I will thank the Minister for that. Given what he has said, I will bring Pontesbury parish councillors to meet him here in the House of Commons before the general election, and I thank him for accepting.
Let me make a brief point about the local enterprise partnership, about which I asked my hon. Friend the Member for Hereford and South Herefordshire. I believe passionately that the LEP is there to bring Government money in to help with major infrastructure projects—projects that are going to create businesses, jobs and prosperity for the areas they cover. At the request of our council, a considerable amount of money from the LEP is now having to be put towards improving such services in Shropshire. That is clearly taking money away from something that I feel passionate about and that I wish to raise money for, which is the university of Shrewsbury. That money should not come from the LEP. As we are talking about a fundamental right of all our citizens, the money should come directly from the Government. We should not have to distinguish between the projects in the LEP.
I pay tribute to the leader of Shropshire council, Mr Keith Barrow, who has campaigned tirelessly on the need for the Government to provide more funding and resources for broadband and mobile phone coverage in Shropshire. I look forward to meeting the Minister with the parishioners of Pontesbury and I hope that we can make progress on this issue in the months ahead.
Madam Deputy Speaker (Dame Dawn Primarolo)
Order. A large number of Members wish to take part in this debate. There will be an eight-minute time limit starting from now. I hope that that will last for the entire debate and will not need to go down any further. But we will have to keep an eye on the time.
Mr Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP)
I am not sure, given the new time limit on speeches, whether I will get many megabits per second into my speech, but I will try to get in several syllables per minute.
Mr MacNeil
Well done, thank you. At least somebody on the Opposition Benches is switched on. I just saw a lot of blank faces on the Government Benches.
As people, many of our needs have been met. We have food, drink, clothing and communication. In our houses, we have electricity, water and insulation, but we need communication and connectivity. That connectivity happens thanks to broadband—hopefully, it is 4G and mobile connectivity. The point was well made by the hon. Member for Somerton and Frome (Mr Heath) who talked about “not not spots”. Let us ensure that we get “have have” spots, because that is what we need. This connectivity is a natural need, and it is what many people want and expect. The expectation that that connectivity will be in place is growing. People are comparing the situation in their own areas not only with other places in their own countries but with other countries, particularly rural places in other countries.
Our aim is to have superfast broadband and 4G reaching 98% of the population, which should mean that connectivity is well distributed across the country and that we do not have places in the UK where broadband coverage is far below 98% of the population. If 95% of us have superfast broadband, then surely 100% of us should get normal broadband. If superfast broadband has speeds of up to 30 megabits or more, surely others can reach 2, 4, 6 or 8 megabits.
There is also a possibility of convergence with 4G, as 4G is primarily a data carrier with speeds of up to 30 megabits. It does not matter whether or not people are connected with fibre, because connectivity can be found to enable them to get on the web thanks to the speed of the new mobile communications.
Mr MacNeil
I see the Minister nodding. I am glad that he is in agreement with me. Connectivity is a social necessity and a business requirement. Young people definitely expect it in rural areas. If we want to keep young people in those areas, we should ensure that they have proper coverage.
Recent lightning strikes in the outer Hebrides and the Na h-Eileanan an Iar constituency knocked out the British Telecom lines for a period of time. I came across hard-working BT engineers in ditches, fields and on roadsides, looking to find the faults for individual houses and knowing that the fault could lie in any one of four possibilities. They worked hard and did their best to get the lines up and running. Meanwhile, people have been in more than a not not spot. In fact, they have found themselves in a not not not spot—to extend the point made by the hon. Member for Somerton and Frome.
Mobile telecommunications are a social utility; they are really necessary for people. We are no longer talking about having them for lighter reasons. People, including pensioners, need the links to make contact with the outside world. Mobile telecommunications are particularly important in places that are far removed from major centres of health care. People who have heart attacks can be diagnosed or have measurements taken from them and then the details can be sent to a specialist who can then advise them on their treatment. I am talking about a life-saving potential, which I know that the Minister recognises.
My fear is that the UK has been left behind in its treatment of rural and island areas. Island areas with the best coverage include the Isle of Man and the Faroe Islands, which control their own mobile and broadband communications. In many ways, the UK has failed in this regard, as 2G is patchy at best, and 3G is patchy if existent at all. Surely, this will not happen with 4G as well. In the Faroe Islands, for 50,000 people there are about 50 3G masts. We look at that with envy in the highlands of Scotland. With a femtocell system, they can reach fishermen 100 km off land on mobile phones on their boats. Although mobile phones do not have that range, they have developed the technology to do that.
In places such as the Faroe Islands there can be a signal in the undersea tunnels between their islands. In stark contrast, people who travel into London cannot use their mobile phone on the Gatwick Express as they go through tunnels. That is an indictment of the treatment of mobile telephony in the UK. I happened to be on the train with a Norwegian the other day and he could not believe that his mobile phone would not work in the tunnels. There is a really bad signal and that is almost the benchmark of what has been happening.
Roaming, or the lack of it, is definitely a problem. I think the model of not enabling roaming has been wrong, because sometimes, particularly in rural areas, there is a mobile telephone network available, but only one. People end up having to carry two mobile telephones and if they know the local area well they will know roughly which one they can use to get a signal. At this point, I praise Vodafone, which has been very good at providing a community Openreach system. I have managed to secure it in a couple of places in my constituency and hope to get it in more. It piggybacks the broadband network to give people a much wanted mobile phone signal.
We must listen when providers say that they could provide a better signal if they were allowed masts that were a little higher. I am not coming down on either side of that argument, as it might be a contentious issue and we will have to wait and see what people say, but we must bear it in mind. Mobile phone companies say that they could give us better coverage if they had higher masts.
Companies also have problems with the bottlenecks of transmitters and masts. Sometimes, unreasonable rents are asked of a second mobile phone company that wants to use an existing mast, because of the basic greed of some companies. That is choking the life and expectations of many communities. The problem also affects tourism, as people go on holiday and are unable to use their mobile phones. That is a point of frustration. If they did not want to use their telephones, they would of course switch them off.
There have been many pleas to the Minister to visit constituencies, but I would like to lighten his work load. I am not inviting him to my constituency—now there is a disappointed face. If he wants to come to Na h-Eileanan an Iar to see our beautiful scenery, he is of course welcome. My political point, which I think would help him, is that he should devolve many of these things to the Scottish Government, who could then control it all.
Mr MacNeil
I am afraid that I meant both mobile and broadband. The Minister is right that the Scottish Government have done a great job and he gives me a tremendous opportunity to tell him just how well they have done. While the UK Government provided £100.8 million through BDUK, £410 million is being spent on the Digital Scotland superfast broadband programme. For that, great thanks should go to the Scottish Government, who know full well and understand the situation.
Mr Alan Reid (Argyll and Bute) (LD)
The hon. Gentleman is fiddling the figures. The total might be £400 million, but well over £100 million of that came from the UK Government and well over £100 million from BT. The Scottish Government put something in, but delivery by the Scottish Government and BT is hopeless. It is high time that the hon. Gentleman got on to the Scottish Government and told them to deliver broadband to my constituency with the money they have.
Mr MacNeil
I see that the hon. Gentleman is criticising British Telecom—I am not sure whether he is calling for a Scottish Telecom. When he spoke on this issue in the middle of last month, he did not allude to the fact that there was £400 million. He said that only £120 million was being spent and did not give the full picture at all. He will, of course, be delighted to know that a 4G pilot project is coming to the island of Coll, which I am very pleased and excited to hear about. Surely he should be welcoming the progress we have seen and the laying of fibre cables to 19 remote islands, including some of my own. I am pleased to see that and I hope that it will expand. If the Scottish Government were not involved and only his own Government were, we would not have seen that at all and we would have been in a parlous state. The hon. Gentleman would do well to remember just what the Scottish Government have done. Just today, we have the news of the improved services going live in Orkney and Shetland—not my islands or his, but we celebrate that that is coming. I particularly celebrate that the service is on the way to Stornaway as well, where 5,000 premises in the Hebrides will be connected to superfast broadband for the first time.
Our next step is to expand throughout all the islands, in the rural areas of each island, and to make sure that everyone benefits, because we do not want a situation where we have the not not not spots. Lack of broadband access is a social blight and a business blight, which of course leads to an economic blight. We need the same connectivity not just as the cities of the UK but as the rural areas of the Nordic countries.
Nick Herbert (Arundel and South Downs) (Con)
First, I add my thanks to my hon. Friend the Member for Hereford and South Herefordshire (Jesse Norman) for initiating this debate and the interest he has taken in the subject, which concerns a large number of us who represent rural constituencies and who believe that access to broadband is now essential, not a luxury. Despite its relative proximity to London, I had in my constituency two of the country’s four not spots. Even though the villages are just 50 miles from London, broadband was not available at all. The latest House of Commons figures suggest that only 52% of my constituency has superfast broadband access, making it one of the worst for broadband coverage. Many of my right hon. and hon. Friends who represent rural constituencies will be familiar with that situation.
Richard Drax
Does my right hon. Friend agree with me that we must not forget the plight of farmers, who now have to apply online for their money from the EU? Between 10% and 15% of farmers do not have the capability to do so, which will have a serious impact on their livelihoods.
Nick Herbert
I strongly agree. That is a good example of why access to broadband is no longer a luxury but a necessity, particularly when people such as farmers are required to file information in that way.
Three and a half years ago, I held a summit in conjunction with West Sussex county council. The then Culture Secretary, my right hon. Friend the Member for South West Surrey (Mr Hunt), attended and we had a good meeting to discuss how to improve the situation. Following that, the Government announced their programme to extend broadband access across the country and West Sussex county council announced its Better Connected programme. With £6 million-worth of central Government support, which was matched by the county council, the programme will fulfil the Government’s ambition to ensure that 95% of the county has access to superfast broadband and the whole county has broadband coverage by 2017.
I welcome the Government’s support and commitment. I recognise what they have done to make improvements, but we have to look ahead and test whether what is being done will be sufficient to ensure access for those in rural areas who will not benefit from the programme. The Rural West Sussex Partnership, which is a branch of the local enterprise partnership, Coast to Capital, has suggested that in fact the coverage delivered by the programme will not be 95%, but could be 90% or even as little as 85%. Even if 95% coverage were to be achieved, there would still be the matter of the 5% of people who did not have access to superfast broadband. They are often the people who do not have access to mobile phone coverage, either, and are therefore effectively disconnected.
I know of the strong interest taken by my hon. Friend the Minister for Culture and the Digital Economy and my right hon. Friend the Secretary of State for Culture, Media and Sport, who met me recently to discuss these issues. I was grateful to him for the interest that he showed and for listening to the concerns that I set out. I have a few observations which I hope he will not mind my repeating to the House.
First, as other hon. Members have pointed out, there is a problematic lack of competition in the sector. That is one of the reasons why we are not seeing the necessary roll-out, an effective roll-out or sufficient customer service. There was a problem in the initial contracts awarded by BDUK because, although there were originally two bidders, one—Fujitsu—dropped out. We ended up, therefore, with one bidder for the contract, BT. So there is an effective monopoly and that is unsatisfactory. That is not the Government’s fault; it is simply the reality.
Chris Bryant
The right hon. Gentleman makes an important point. We need greater competition because that would deliver results faster for everybody. However, I query his last comment. With 44 small tenders, it was remarkably difficult for anybody to presume that they might gain more than one, other than BT. My worry is that the way the tender process was set up created the monopoly in the first place.
Nick Herbert
I am not sure whether that is the case, but we can look ahead at how we can inject more competition into the sector to ensure the competitive pressures needed to improve customer service. I would look again, as hon. Members have suggested, at BT’s relationship with Openreach and see whether there is a case for splitting them, injecting more competition there and potentially breaking up Openreach. We need more competition in this sector.
Secondly, we should not be fixated on the fibre-based solution, which will never be realistic in the hardest-to-reach rural areas. In those areas, wireless technology or access to 4G or faster mobile data signals will become the solution. I do not believe that satellite will be the solution. We therefore need to ensure that the kind of solutions being advanced in public-private partnership recognise that different solutions will be necessary in rural areas.
Mr Graham Stuart
Does my right hon. Friend, like me, welcome the £10 million fund that the Government have created to develop new technologies? Does he, like me, hope that the Government might be able to go further to make sure that small companies, such as those in my constituency, can be supported to develop the technology, show proof of concept and thus challenge BT and deliver for rural communities?
Nick Herbert
Indeed. Like my hon. Friend, I welcome the Government’s funding initiative in this area. I had intended to go on to say that. None of what I say is a criticism of the Government; they are merely suggestions as to how we can improve the situation further.
Thirdly, we need to ensure that the technologies adopted are future-proof. There is a danger that in seeking to meet the commitment to wholesale coverage by 2017 or superfast coverage for 95%, technologies are adopted that will not stand the test of time and will quickly be found to be insufficient.
Fourthly, I have a general observation to make about subsidy. Given that we all agree that access to broadband is an essential public service, there is a role for public subsidy in this area. That role should be to correct instances of market failure. We need to be careful to ensure that subsidy is not directed at companies or providers where the market would provide a service. With the current BDUK roll-out, there is a danger that public money is being used to close the gap in areas where it would have provided the service anyway, and the remaining 5% or 10% is not being covered. We must ensure that in future subsidy is directed to the hardest-to-reach areas and that the market is left to fill the gaps. That is a hard judgment to make, given that we are trying to ensure that the market operates properly.
In my constituency villages are being connected one by one. There is a tremendous improvement, which reflects the initiative of the Government and the county council. I welcome that, but I suspect that many of those villages would have been connected anyway to fibre. What is happening is that the rural areas are being left out. I remind the House that these rural areas comprise a great number of people and rural businesses who need to be connected. There is the danger of a growing digital divide, which might in turn become a further manifestation of something we need to avoid: a rural-urban divide. We see that in many other aspects of policy, and I think that we should strive to prevent it.
I mentioned that three and a half years ago I convened a summit to discuss how to improve the situation in West Sussex, and I believe that it bore fruit. I therefore suggest holding another similar event in West Sussex, not to criticise but to look forward and see how we can close the gap and ensure that we do not have a digital divide in rural West Sussex in future. I would be grateful if my right hon. Friend the Secretary of State considered attending the summit, partly because of the lessons I think there would be for other rural areas. The summit would have the active support of the South Downs National Park Authority, for instance, which is very interested in the issue. The Government have done a great deal to improve the situation. We must now ensure that we go further and close the digital divide.
Ms Margaret Ritchie (South Down) (SDLP)
I pay tribute to the hon. Member for Hereford and South Herefordshire (Jesse Norman) and to the Backbench Business Committee for securing this important debate. I often think there is a problem with people in rural areas being told to modernise and “get with the times” while being provided with none of the infrastructure or capacity needed to do so. The Environment, Food and Rural Affairs Committee, which is chaired by the hon. Member for Thirsk and Malton (Miss McIntosh) and of which I am a member, only this morning published our report on rural broadband and digital-only services, following closely behind the National Audit Office’s recent report. I will focus my remarks on the deficiencies in rural broadband provision and the impact on local business, farming communities and economic growth.
Members will be aware that responsibility for the roll-out of broadband access is devolved, with funding, to the devolved Administrations, as the Secretary of State noted in answer to the hon. Member for Na h-Eileanan an Iar (Mr MacNeil). However, we in Northern Ireland face many of the same problems, and unfortunately many of the same deficiencies, with the Government’s approach to tackling rural connectivity, because communications and connectivity are central components of this and have to be resolved. In common with others across the UK, we face the issues associated with there being only one service provider—BT.
As phase 1 of the rural broadband project is rolled out, in parallel with the Government’s “digital by default” strategy, we must urgently take stock of the process and act to correct failings in subsequent phases. “Digital by default” should not become “digital by diktat”, especially in cases where the support is simply not there. At the moment, “digital by default” is proceeding at a pace that the broadband connectivity strategy is struggling to keep up with.
A central criticism made in the Select Committee’s report is that current efforts to bring rural communities up to speed with basic broadband access fall short of the EU’s Europe 2020 target of having superfast broadband—30 Mb—for all by 2020, and the universal service commitment target of 2 Mb already looks out of step with consumer and business needs, even though, sadly, it probably will not be met.
Miss Anne McIntosh (Thirsk and Malton) (Con)
Is the hon. Lady aware that Germany has set a target of 50 Mb by 2020, and that the overall EU aspiration is to have 30 Mb by 2020, which means that our farmers’ competitors will have much faster broadband?
Ms Ritchie
I thank the hon. Lady for her helpful intervention. Those countries are in direct competition with us, and people involved in rural businesses, particularly those in farming communities, will be at a disadvantage. The Government urgently need to address this issue in conjunction with BT.
Dr William McCrea (South Antrim) (DUP)
Does the hon. Lady accept that some areas in Northern Ireland are enjoying superfast broadband, but rural communities seem to lack it, and certain areas have very little broadband, with families, as well as local businesses, suffering as a result?
Ms Ritchie
I thank the hon. Gentleman for his helpful intervention. I agree. The conurbations of Belfast and Derry have benefited from superfast broadband, but we who represent rural communities have not seen the best impact of that innovation. In my constituency, I have not spots and also the impact of a mountainous region. That topography limits the accessibility of superfast broadband.
Priority needs to be given to business centres in rural communities. In my area, a business centre was approved by Invest Northern Ireland and given planning permission by our local planning authority some years ago. It has a box for broadband connectivity that is not even enabled, and that will not happen until next year. How on earth do Government, in UK national terms or in devolved regions, expect a local economy to grow and develop and to provide for its citizens, whether they are ordinary rural dwellers or those who undertake farming enterprises, unless they have total access to broadband? That issue needs to be addressed.
From an infrastructure point of view, copper wires, which deliver basic broadband, will have to be replaced by optic fibres to deliver superfast broadband within a matter of years. As optic fibres are significantly cheaper, it makes no sense that intense efforts are being made to offer rural communities a mediocre broadband service that is already considered outdated at a time when urban areas are already receiving upgrades to superfast broadband.
Only this week, the Federal Communications Commission in the United States approved a new definition of what constitutes a broadband service, dramatically increasing the required minimum speeds from the current standard. Other countries recognise the importance of rural access to broadband, and if the UK does not, consumers and business will be left behind. The FCC has suggested that 25 Mb should be the new standard speed. If that is the case, we will definitely be left behind.
We are very much at risk of opening up a digital divide and a digital deficit between those with high speed and those without. This affects not only individuals but businesses in local areas. How can they be expected to compete without fair access to the same opportunities offered by new technology? In the EFRA Committee report, we suggest introducing subsidies such as vouchers. We also recommend investigating alternative technologies. That is being explored by the Government, and I hope that it comes to fruition. I urge the Secretary of State to give careful consideration to our report, on which the Government are expected to report anyway. Some very useful recommendations are contained therein which could assist the Government in working with BT and influencing it to carry out full implementation for the sake of farmers, rural communities and those engaged in rural businesses.
Julian Smith (Skipton and Ripon) (Con)
I pay tribute to my hon. Friend the Member for Hereford and South Herefordshire (Jesse Norman) for securing this debate.
North Yorkshire was one of four pilot areas that won a Government commitment in 2010 to push forward with superfast broadband in rural areas. To counter the comments of the jumping jack shadow Minister, the hon. Member for Rhondda (Chris Bryant), the whole idea of the project was that it should be driven by communities and not top down from London, and that approach has worked to great effect in North Yorkshire. The group of MPs, including my hon. Friend the Member for York Outer (Julian Sturdy), the council and local politicians have all driven Superfast North Yorkshire, which is now delivering to 86% of the most rural county in England, and that figure will rise to 90% over the next year.
Our contract was different from the Broadband Delivery UK contract. It was a specific contract with, ultimately, BT, but it was very competitive: there was full competition and transparency and BT won it at the end of the day. I pay tribute to those working locally, including John Moore, the chief executive of NYnet—the broadband body of North Yorkshire county council—who will retire in the next couple of months, and my predecessor John Watson, who has chaired that body. The contract has some great innovations. BT will pay back money to the council as part of it, if demand and usage are adequate. BT is also committed fully to a minimum of 2 Mb for all areas of North Yorkshire, whatever happens, and we will hold it to that commitment.
Farms and hard-to-reach areas in the most rural communities of Skipton and Ripon and North Yorkshire face huge challenges, and I agree with my right hon. Friend the Member for Arundel and South Downs (Nick Herbert) that they will be solved only through wireless and innovative technologies. The cost of delivering through BT could be up to £1,500 per house and it is only innovation that will get us there.
Adam Afriyie (Windsor) (Con)
My hon. Friend is making a powerful speech about competition and the benefits of the scheme in his area. Does he agree with me, as chairman of the parliamentary space committee, that broadband links certainly have a role to play in the short term, although fibre is clearly the long-term solution?
Julian Smith
I agree. That is a valid point and I acknowledge my hon. Friend’s expertise on this topic.
I pay tribute to the Government for the £10 million fund for innovation—North Yorkshire has one pilot project called Airwave—but the exceptional broadband Minister may need to dig a little deeper over the coming months and years in order to top up that fund and get a few more pilot projects going. I pay tribute to LN Communications in North Yorkshire, which, through David Hood and other investors, is trying to deliver solutions.
Julian Sturdy (York Outer) (Con)
My hon. Friend is making a powerful speech and he is absolutely right to champion the success—a lot of which is down to the Minister—in delivering broadband to a number of communities in North Yorkshire and York over the past few years. Does my hon. Friend agree that it is critical that we ensure that those last few remaining rural communities without high-speed broadband in his constituency and mine can get connected? A digital divide is materialising and this is about getting the last penny we can out of the funding.
Julian Smith
Absolutely. That is a well-made point. This is not just about the Government’s responsibilities; people are taking responsibility themselves. The B4RN project—Broadband for the Rural North—split between Lancashire and Yorkshire has sought out all of the disused wires and cables to make the most of the opportunities to deliver superfast broadband.
We have not yet discussed the issue of demand, demand stimulation and how much superfast broadband is being used by our communities. On average, the figure is 18% to 20%, and in North Yorkshire it is about 20% to 25%, but we need to get those numbers up. The Opposition criticised the Government for an ad campaign over Christmas, but the Government were absolutely right to spend that money. What is the point of all the pipework and infrastructure if they are not going to spend money to encourage people to use it?
Julian Smith
I am not going to give way to jumping jack.
I pay tribute to the expertise of Chris Townsend, who has no need to do the job but who is giving great public service by leading BDUK and pushing us forward.
We have talked about Openreach, and I concur with all the comments made. We are generally happy with BT in North Yorkshire, but there have been major service and data issues. We have tried to get information from particular boxes so that we can work out where we can improve and get more demand—again, the Minister has been helpful in knocking heads together. The issue of fibre to the node is providing opportunities to get deeper into rural areas, although BT has dragged its feet on that.
Ultimately, the infrastructure of the fourth national utility is managed as a subsidiary to the overarching board of a global successful corporation. Is that the right structure going forward? In football rights versus infrastructure I think football rights will always probably win, and we must have a real think. Ofcom started that in the past few weeks, and we must think over the coming years, with a Conservative-led, competition-driven Government, about how Ofcom is structured for the future.
Richard Benyon (Newbury) (Con)
I refer hon. Members to my entry in the Register of Members’ Financial Interests.
I represent a rural constituency that is in the teeth of the superfast broadband roll-out, and is also the home of Vodafone. Twenty-five years ago, the first call was made from Newbury. The office contained 12 people and was above a curry house at the top of the high street. Vodafone is now one of Europe’s most successful companies. I do not stand here as the voice of Vodafone, but it is worth pointing out that the technologies developed through the inspirational leadership of people such as Sir Ernest Harrison are remarkable.
I was in Africa not long ago seeing the M-Pesa project, which is responsible for about a quarter of the financial transactions. It has completely changed the social dynamic and the ability of people who work in distant places to send money. It is remarkable. In this country Vodafone has developed a system for supporting people who are victims—or potential victims—of domestic violence through an alert system, and it deserves credit for much of what it has achieved.
West Berkshire has a rural population that is involved in two of the most dangerous professions: agriculture and the horse racing industry around the Lambourn valley. Getting good mobile phone coverage is not just a matter of convenience or of jobs and employment, but can be something that saves lives. The roll-out of the mobile infrastructure project is dear to our hearts in that area, and I would welcome an update from the Minister on how the project is going.
I welcome the Government’s effort to solve the problem through a legally binding agreement with the four networks that will see £5 billion invested in the UK’s mobile infrastructure. The results need to be visible as soon as possible so that constituents in areas such as mine can maximise their businesses, and people who live in rural downland villages in west Berkshire can fully partake in the dynamic Thames valley economy.
I am interested in the report produced by the Environment, Food and Rural Affairs Committee, and I hope that we can hold the feet of the various delivery agencies and companies to the fire, and ensure that we deliver on some of the dates. The Government’s original objective of rolling out superfast broadband to cover 90% of premises by 2015 has been altered to 95% of premises by 2017. BT has said that it is there or thereabouts, but that it might end up being achieved in 2018. I hope the Minister will ensure that such comments are challenged. Chris Townsend of Broadband Delivery UK has stated that he is “absolutely committed” to finalising the last 5% by 2020 at the very latest, and if that is accurate I hope we try to speed it up.
Neil Parish (Tiverton and Honiton) (Con)
This is one of the problems. BDUK seems to be putting back the start date for many schemes. The village of Upottery near Honiton does not know whether it will get superfast broadband in 2016, 2017 or 2018. BDUK has been given money to get to the hardest-hit areas, but it is not getting there on time. I hope the Minister will keep up the pressure on BDUK to deliver.
Richard Benyon
I am supportive of what the Government have done and of the range of options to ensure there is no digital divide between town and countryside, but that does not mean we should ever be satisfied. We should push at the door wherever we can.
Alistair Burt (North East Bedfordshire) (Con)
Before my hon. Friend leaves that point, Dunton in my constituency was expecting to have its broadband confirmed, but it has been delayed yet again. Such dashed expectation is a constant concern. Even though there is a small percentage left to cover and the Government have done a great job, that small percentage feel left out.
Richard Benyon
That is frustrating—I entirely understand my right hon. Friend’s concerns.
I had the pleasure of being the Minister responsible for national parks and areas of outstanding natural beauty. Nobody feels more strongly about landscape than I do, but our planning policy is still restrictive. There is a phrase that I find myself using too much in politics: “The squeaky door gets the oil.” Often, when there is a proposal by a mobile phone company to put up or raise a mast to achieve more coverage, there is a lot of noise from a small number of people. The silent majority who just want a better mobile phone signal are not heard. It is important that we listen to the silent majority.
Richard Benyon
If my hon. Friend will forgive me, I will not because other hon. Members want to speak.
At least two mobile phone masts in my constituency are designed as pine trees. I am not a great fan of pine trees and the masts do not look like pine trees to me, but they work perfectly. That is a solution for those who believe landscapes will be abused by the presence of masts. I urge mobile phone companies to develop more fake pine trees of that nature.
Regulations on renting land for masts and on repairing and upgrading those masts have not been meaningfully updated since 1984. The industry suffers from much higher rents. My hon. Friend the Member for Cities of London and Westminster (Mark Field) made a good point about urban mobile phone signals, and that is one of the reasons for his problem. In Madrid, there are two thirds or at least half as many more masts than there are in London, one of the most important cities in the world. We can understand why his constituents are frustrated. My question—it is perhaps rather philosophical than an attempt to elicit views from the Front Benchers about the election—is on whether we should be looking at mobile phone delivery much more as a utility. My fellow members of the Country Landowners Association might not thank me for saying this, but it could be an opportunity, because that might dictate a different type of rent.
The electronics communication code needs amending, and amendments to the Infrastructure Bill tabled to introduce the new code were withdrawn. I hope the Minister updates us on the code.
I want to draw hon. Members’ attention to a remarkable Vodafone project in west Berkshire, in the village of East Garston up in the Lambourn valley. I hosted an event and I am really pleased the Minister came and made an excellent speech. There are pilots around the country and that was an opportunity for him to show off his new beard, which we all welcome. In rural locations, networks can struggle to deliver coverage by traditional means, but it can be done through small technologies. In that case, a community of 450 people in a not spot have been provided with a signal from a church steeple. The Vodafone project was delivered not through a top-down statist approach, but through a local provider working with a community. It was a joy to see the first of those Vodafone pilots. It is now one of 100 schemes throughout the country. We have heard of a similar scheme in north Norfolk that has transformed the tourism potential of the area. That is a key area of delivery for the tourism industry.
I would love to spend more time talking about broadband connectivity. We in west Berkshire look forward to ensuring that 95% of Berkshire is covered by 2017. Our focus is now on the final 5%. I believe my local authority will make an announcement in the next few days which will be welcomed by a great many people, and that we will see benefits delivered. I agree entirely with my hon. Friend the Member for Somerton and Frome (Mr Heath) that the last 5% will always be the most difficult—on any subject. We must focus not just on being rigorous in one technology but across the piece. We must be flexible and local in how we deliver this. The Opposition suggest a centralised approach that we know has failed in the past. The Government have put in place an approach that works with communities.
Mr Speaker
I call Cheryl Gillan. Ah! Mrs Gillan has toddled out of the Chamber. I was going to call Anne McIntosh, but she has toddled out of the Chamber too. I call Mr Alan Reid, who has staying power.
Mr Alan Reid (Argyll and Bute) (LD)
I thank the hon. Member for Hereford and South Herefordshire (Jesse Norman) for so ably introducing the debate and the Backbench Business Committee for the opportunity to raise the hopeless performance of telephone companies in Argyll and Bute.
In the past two months, telephone companies, both landline and mobile, have failed miserably to keep many of my constituents in telephone contact with the rest of the world. Following a storm in early December, some constituents are still waiting for their landline service to be repaired. The experience of one constituent from south Kintyre is typical. He reported a fault in December. BT made an appointment for an engineer to visit on 28 December. That appointment was not kept. It was the same on 14 and 28 January. He is still waiting. He now has another appointment for this Thursday. I hope that this time the engineer will turn up and fix the fault.
BT’s excuse is that it has declared MBORC, which stands for “matters beyond our reasonable control”. It claims that owing to exceptional circumstances, it is unable to meet its normal commitment times to provide a service or repair faults. It seems that by declaring MBORC, BT can also get away with not turning up for appointments. This is totally unacceptable. The engineers are clearly working flat out, often in difficult weather conditions, but BT clearly does not have enough engineers operating in Argyll and Bute.
Roger Williams (Brecon and Radnorshire) (LD)
My hon. Friend has been given a different excuse for not fixing a fault. In my constituency, the problem was the unforeseen meeting of NATO in Newport. Does he agree that that was a foreseen circumstance?
Mr Reid
My hon. Friend is correct. We all knew for months, if not years, in advance that NATO was meeting in south Wales. His comments clearly indicate that BT looks for excuses to declare MBORC.
As several hon. Members have mentioned, BT Openreach is in the privileged position of having a monopoly on landlines. It should not be able to dodge its responsibilities for months simply by declaring MBORC. Will the Minister look at the regulations again?
The universal service obligation is supposed to guarantee a landline service no matter where one lives, and my constituents are quite rightly fed up being told that if they lived in Glasgow their phone line would be repaired quickly, but that they will have to wait months because they live in a rural area. I hope the Minister will look at the regulations again. Heavy fines need to be levied for failure to repair faults in a reasonable time and for not turning up to appointments. If BT was faced with heavy fines, it would be compelled to employ enough engineers.
Sir Robert Smith
It also transpires that Openreach pays compensation to service providers, but not all service providers necessarily pass that compensation on to the end user. Perhaps if there was more of a compensation culture the management would be more efficient about maximising repairs.
Mr Reid
My hon. Friend makes a good point. Fines are necessary to encourage companies to carry out their responsibilities properly, and not just use the cop-out of declaring MBORC.
On mobile phones—the problem is not just with landlines—Vodafone cannot escape criticism either. Its performance in carrying out repairs has been poor. For example, last summer it took 18 days to repair a fault on the isle of Islay, and another fault on Islay in December took even longer to repair. These are not isolated cases. There is now yet another fault on Islay that is taking ages to repair, and there have been several instances in other parts of Argyll and Bute of long delays. When challenged, Vodafone dodged responsibility by blaming the many other companies involved in tracking down and repairing faults.
A mobile phone service is not a luxury these days, but a necessity—for example, if someone’s car breaks down on a quiet country road or a farmer has an accident. I am aware of a farmer who broke a leg. He was conscious and able to use his mobile phone, but because he had no signal, he had to lie in severe pain until somebody found him. That shows the importance of mobile phone coverage these days. It is an essential, not a luxury.
I am pleased the Government have reached an agreement with the mobile phone companies. It means that the latter will be investing at least £5 billion over the next three years to extend coverage and improve signal strength, and that the number of places not covered by mobile coverage will reduce by two thirds. However, I will keep fighting for 100% coverage and speedy repairs, because speedy repairs are as crucial as the original investment. It is no good having a box-ticking exercise with an investment strategy, and then failing to maintain the service. Constituents with contracts with Vodafone are entitled to use the service. Leaving everything to the market is no good, because the mobile companies and BT Openreach would simply concentrate on the densely populated areas and ignore the highlands and islands. The Government should introduce performance standards for repairs and fine companies that fail to meet them.
Having criticised Vodafone for its failure to carry out repairs in a reasonable time, I want to congratulate it on its Rural Open Sure Signal programme, which will bring mobile phone coverage to several villages in my constituency. However, I urge it to follow up the initial investment and all the publicity with a proper repair service, because that investment is no good if the system does not work.
I was pleased when in 2013 the Government gave Arqiva a contract to build mobile phone masts in places where there was no signal. The new masts were supposed to be up and running by the end of this year, but from the experience of Argyll and Bute, this programme seems to have badly stalled. The last time I met Arqiva, it could not say where in my constituency the new masts were to be sited or when they would be constructed. We need more transparency, and I hope the Minister will tell Arqiva to publish its intentions now. We need to know where the masts are going and when they will be put up.
Bringing superfast broadband to rural areas is vital. I am pleased that more than 20% of the Government’s investment in superfast broadband—more than £100 million—was given to the Scottish Government to bring superfast broadband to rural areas in Scotland. However, delivery was left to the Scottish Government, and they gave the contract to BT Openreach. Cables have been laid and some addresses have been connected to the new superfast broadband, but most of Argyll and Bute is extremely frustrated that neither the Scottish Government nor BT can tell them when, or even if, they will get broadband. Some people on very slow speeds tell me they do not want superfast broadband; they just want a decent broadband service.
The Scottish Government and BT must be much more open and tell people when, or if, their home or business will be connected to fibre-optic broadband. Not knowing what is happening prevents people from making other arrangements, such as wireless or satellite. Given these failings, I must congratulate a local organisation on its initiative. Mull and Iona Community Trust, well led by its extremely enterprising general manager, Moray Finch, is leading the way with a project that will deliver superfast broadband by wireless to parts of Mull and Islay, as well as to the islands of Iona, Colonsay, Lismore, Luing and Jura, and to Craignish on the mainland. MICT has done very well, but that same type of project should be going on throughout Argyll and Bute, because in many places it is simply not practical to deliver superfast broadband via fibre-optic cable. I want the Scottish Government to follow the lead of the Mull and Iona Community Trust and work with community groups throughout Argyll and Bute to deliver superfast broadband everywhere in the constituency.
It is not just in remote rural areas that problems arise. BT promised that the town of Dunoon in my constituency would get superfast broadband paid through BT’s own resources last year. However, this was postponed without any announcement—it was only when people started complaining that we found this out—and it is supposed to be happening this year, but there is still no sign of anything happening. Some constituents receive extremely slow broadband speeds of well under a megabit in some cases. It is high time that BT got the work done and gave my constituents a decent broadband service.
Broadband and mobile phone services are essential these days. Investment in infrastructure and much speedier action when faults occur are essential. The Scottish Government and BT must drastically improve their performance to bring superfast broadband to Argyll and Bute as a matter of urgency. BT and Vodafone must drastically improve their performance when repairs are needed. The loss of both landline and mobile phone services in Argyll and Bute this winter has been unacceptable. I call on the Government to beef up the regulations so that phone companies can be fined for poor performance when repairs to the phone infrastructure are needed.
Anne Marie Morris (Newton Abbot) (Con)
This is an important topic, and I shall concentrate on rural broadband rather than mobile technology. In Devon, we have challenges with both, but the broadband issue is certainly acute.
It must be said at the outset that the Government are to be congratulated on their ambition to achieve 95% superfast broadband coverage by 2017, which is admirable. The Government are to be congratulated, too, on the level of contribution provided to those in rural areas. Devon has had a generous settlement, so the real challenge has been matching that funding. At the moment, we are pretty much on course to achieve it.
As a number of colleagues have acknowledged, the challenge is in implementation. The first challenge is to manage expectation. The original maps of what was going to get done and when were, frankly, not fit for purpose. The current offering is very much better, and I accept the limitation that a postcode can never entirely clarify exactly where people can and cannot get broadband. The problem is that the consumer who signs up for superfast does not know that. If we cannot do a better job, can we have at the very least a health warning or something put in the contract so that people realise that at the end of the day when they have paid their money, they still may not be able to receive superfast broadband?
My second point is managing the roll-out, which has been mentioned by a number of colleagues. Clearly, to get to this 95% figure, we will have to make sure that the commercial commitment from BT and the subsidised commitment from BDUK are both met. There is a concern that although the match funding projects with BDUK are moving forward at a reasonable pace, the commercial ones are not. This needs to be carefully managed.
Thirdly, dealing with the last 5% is most important. If people live in a rural part of the country, it is critical to take account of it first and foremost rather than last or as an afterthought.
Neil Parish
We talk about the 5%, but in many constituencies—mine included—a lot more than 5% are affected. It might be 5% nationally, but it is probably in the order of 65% of my constituency that do not receive superfast broadband. We need to concentrate more on getting this out to the harder-to-reach not spots.
Anne Marie Morris
My hon. Friend makes an appropriate point. Although the Government have done a good job looking at the new technologies—I believe they have considered reducing the options to about three—we need more than just “these are the best options”. It needs to be rolled out, and MPs and councils need to be kept well abreast of what the options are. With self-help support for local communities, we should be able to make this happen.
My communities have got together in a number of areas—and dug ditches and done deals with BT—but this is not well publicised. People living in a community who know that superfast is not coming any time soon are likely to have very little support from the Government. There is very little knowledge that would enable people to get on and do it. The Minister very helpfully provided me with the names of some satellite companies in my constituency, one of which has proved to be first-class. However, I am not convinced that I would have been given an answer if I had not asked the question.
We must bear it in mind that the alternatives have cost implications. I believe that there is a system in Wales whereby vouchers are provided for those who have to take the satellite rather than the fibre route. I urge the Government to think carefully about what can be done to help communities that need help now, rather than waiting until everything else is finished.
Alistair Burt
My hon. Friend has talked about those who are hard to reach. Does she agree that another technical problem has emerged? The longer it takes to provide a superfast connection, the less likely it is that the speed being offered will be sufficient to deal with the new technology that will then be available. That is a further reason to continue the great work that the Government are doing, and to seek alternatives so that the technology is not compromised at the end of the process.
Anne Marie Morris
That is an excellent point, and I am sure that the Minister will take it on board.
My fifth point is this. I do not feel that businesses are at the forefront of the challenge. Broadband is now as necessary as electricity and gas—it is the fourth utility—and if businesses cannot be supported, we are not doing our economy justice. Business parks and business estates are not automatically connected, and BT has been reluctant to deal with that, telling my constituents that it would not be profitable. That, to me, is a real challenge, because I think that businesses must be seen in a very special way.
Guy Opperman
I entirely agree with what my hon. Friend is saying. I think that it applies not only to businesses and commercial premises, but to planning for housing estates. It is vital for the respective departments and planning authorities to talk to each other as the houses are being built. Superfast broadband should be built into new developments, rather than individual constituents having to apply for it after buying their houses.
Anne Marie Morris
That is an extremely good point. BT may claim that the development is in an area that they do not expect to expand enough to justify the commercial cost, but that is not an argument. We know that development will continue. Broadband should be built in at the start: it is no good waiting for it to be a challenge later on. As for businesses, I find it rather horrifying that 35% of business people who work from home still rely on mobile broadband and 45,000 businesses still rely on dial-up. That simply cannot be right.
I have reached my sixth point. The House will be pleased to know that the list is shortening. I think that the promise that everyone will get at least 2 megabits per second poses a real challenge to the Government, because, in my view, that is not enough.
Caroline Nokes (Romsey and Southampton North) (Con)
Will my hon. Friend give way?
Anne Marie Morris
I will not, because I am short of time.
I think that we should take account of the demand for a minimum of 5 megabits per second rather than 2. I gather that the average speed that we have managed to deliver is just over 5 megabits per second, so let us aim for that. I think that the Federation of Small Businesses is considering 10 megabits, which may be a bit hopeful at this stage, but a speed of 2 megabits per second is not fit for purpose. Whether people have enough supply to carry out even some of the most basic tasks, such as reading e-mails, depends very much on the level of demand.
Last on my wish list are two technical points. One is the challenge posed by the wiring between the cabinet and the home. All the rhetoric is about getting superfast broadband to the cabinet. I have asked Ministers, BT and just about everyone else I can think of who is responsible for upgrading the connection, but they have all looked sideways and said “Not me.” Well, it certainly is not the home owner. We need to clarify who is responsible, because if we do not deal with that, getting the wire to the cabinet will not solve the problem.
My final point is about take-up. I know that the Government consider that to be one of the real challenges, which is why they have launched an advertising campaign. If take-up is too low, BT will not have a commercial incentive. However, I think that we need to view the position differently. It is not just a question of advertising. The whole concept of the importance of broadband needs to be hard-wired—forgive the pun—into our planning system, and into how we view buying, selling or renting a property. The information about what is available needs to be there up front; it needs to be part and parcel of searches and the general inquiry someone makes when looking for a new home.
Let me summarise my key points and requests to the Government. First, we should look at how we can make the sector more competitive, and consider having the Competition and Markets Authority and Ofcom look at it. Many Members have raised that point. The challenges and problems we face are in part to do with having effectively a monopoly supplier in BT, because unless it is in its interests and it can make money out of it, it simply does not happen. Secondly, please can we move to more than 2 megabits per second? Thirdly, can we look at improving the self-help? If we can improve the information flow so that people understand what can be done and when, that will be great.
That is a very brief summary, but I hope the Minister has taken on board many of those points.
Mr Speaker
Order. For the avoidance of doubt and pursuant to what was said a moment ago by the hon. Member for Newton Abbot (Anne Marie Morris), I can advise the House that, as things stand, there is no particular pressure on time. That might change, but that is the situation at the moment.
Guy Opperman (Hexham) (Con)
Broadband is just as essential to homes and businesses as electricity and telephone lines in the 21st century. All of us endorse the long-term economic plan as the way in which this Government will turn the country around in the future, and key to that is having broadband, including broadband to the rural areas of our country. In debates such as this, I often hear colleagues talking about their very rural constituencies, but, as you will know, Mr Speaker, my constituency is the most rural in all of England and it is the least densely populated constituency per square mile—there are 1,250 square miles—in England too.
As with Mark Antony and Julius Caesar, I come to praise the Minister, not to criticise him, because the reality is that he is an honourable man and he has in an epic recession overseen a very substantial investment of Government money into Northumberland, which has resulted in the provision of significant amounts of broadband. That money, going through Northumberland county council and working with BT Openreach, has provided a significant expansion on the utterly woeful situation we inherited in 2010. [Interruption.] Throughout this debate we have heard endless chunterings from the hon. Member for Rhondda (Chris Bryant)—one of only two Labour Members on the Opposition Benches, so interested are Labour Members in this subject—but in reality we were left with a terrible situation that this Government have, to their great credit, turned around.
Mr Graham Stuart
Does my hon. Friend agree that the near absolute absence of Members on the Opposition Benches shows the indifference to the rural interest that too often seizes the Labour party, so that even when there are arguments that would reasonably be accepted by their Members they do not come here to hear them, and that rural residents across the country need to recognise which parties do take an interest—including our coalition partners?
Guy Opperman
In what must be the ultimate not spot, nobody who represents an England or a Scotland constituency is present on the Labour Benches. It is not very impressive, we would all agree.
I want to start by talking about the progress that has been made in Northumberland, such that there has now been provision of fibre broadband to Stocksfield, Heddon, parts of Wylam, Ponteland, Stamfordham, Great Whittington, Prudhoe, most of Corbridge, Slaley, most of Hexham, parts of Allendale, Gilsland—as Joan Thirlaway only recently texted me—Greenhead, Haltwhistle, Bardon Mill, Haydon Bridge, Humshaugh, Wall, Chollerford and Wark, all of which is very successful. Sadly however, as the House will be aware, I could also give quite a long list of villages and places which have not had that benefit, although the local authority and BT assure me that it will be provided in 2015. Indeed, only today I received notification from Lieutenant Colonel Richard Clements, the commanding officer of 39 Regiment Royal Artillery, that Albemarle barracks, after many years of not having broadband, now has—literally as of today—fibre broadband being provided to it and the troops there, who have returned from Afghanistan. I pay tribute to the great work that he and all the people who work at that barracks have done to bring that development about.
However, I could list a large number of villages that do not have broadband. It is fair to say that while progress has been made, there are gaps, misnomers and, sadly, too many false dawns. All of us have seen examples of where BT—it is sometimes the county council, but primarily it is BT—will suggest, “Oh, it’s all going to be wonderful in this village. We are providing this broadband to the village, or town.” Sadly, however, what happens is that the broadband is not provided, or else there is only partial provision.
Nicola Blackwood (Oxford West and Abingdon) (Con)
My hon. Friend is absolutely right to make the point about false dawns; I have had many such instances in my constituency. Does he agree that it adds insult to injury when the communication about what will happen and when problems will be put right is often very poor indeed, and communities are left very uncertain about when they will get broadband and what will happen?
Guy Opperman
I entirely agree with my hon. Friend, and I can give examples of that situation. Corbridge Computing Ltd was as excited as I was when Corbridge, a substantial town in my constituency, was told on 19 September 2014 that it had received upgraded broadband. The company asked for the installation the next day; it is just metres from the exchange and various cabinets. To this day, however, it has still not been provided with any upgraded broadband. I could give similar examples, for instance at Dissington Hall. I will open its new rural enterprise hub, which is just outside Ponteland, this Friday, and it is hoped that new businesses will start up there, but to begin with there is the difficulty of not having the internet support that businesses obviously need. In a moment, I will discuss the problems that exist in the village of Matfen.
The reality is that we have false dawns and the situation is extremely difficult, because the lack of communication, and the inability of the roll-out to perform as we were originally told it would, leads to a loss of enthusiasm and support among local communities and constituents.
Caroline Nokes
My hon. Friend mentioned the failure of the roll-out to deliver what is expected of it. Does he share the concern of residents in a new development in my constituency, called Abbottswood, which is right on the edge of Romsey? On moving into their new properties—there are 800 new homes in total—they expected that they would have high-speed broadband, but, unlike the rest of Romsey, they have nothing.
Guy Opperman
That relates to the point I genuinely want the Minister to respond to. Where there are new developments up and down the country, it must be part of the section 106 agreement of planning that the housing developer installs broadband as part of the planning agreement. It seems utterly illogical that we have either residential or mixed-use developments being brought forward without this fundamental precondition. If nothing else comes from this debate, we must surely address that issue.
I make the point to the Minister that in Northumberland we have not slept on our laurels. We have explored alternatives. Many people in the county have satellite solutions, or line-of-sight solutions such as Wildcard, which serves all the village of Newton. In those circumstances, such providers have genuinely made a difference locally.
Sadly, however, value for money is the key driver of Government policy. I understand why that is the case in a recession, but the consequence of value for money being a driver of policy means that the last 5%—or, as in rural constituencies such as mine, that of the hon. Member for Somerton and Frome (Mr Heath), and those of the hon. Members from Cornwall and Devon, those hard-to-reach areas or total not spots—are always the last ones in the queue, because it is so much easier to address the areas with limited broadband, or those that are easier to connect to the exchange. The Government must look at the way in which they structure agreements in the future, so that a change in emphasis takes place. Without that, I foresee difficulty in getting the roll-out to the hard-to-reach areas.
I have repeatedly had meetings with the Minister, the Secretary of State, Broadband Delivery UK, which I met last week, and BT Openreach, the head of which I met only yesterday in the House of Commons. I welcome the fact that a genuine difference is being made, because it is important. I see that when I look at the example of Matfen, a village in my constituency that has had particular difficulties. People there were encouraged by BDUK to seek significant demand registration under the iNorthumberland procedure, to encourage greater funding and to encourage BT to tailor its roll-out to those areas. The consequence is that they sign up to these things but are then told that they are not going to be part of the roll-out that they thought their sign-up was so good for. In the case of Matfen we are exploring, and will be in various meetings in February, how to find a way forward in phase 2 of the roll-out, because these things create false expectation among our communities, which is not good. I appreciate the work BDUK and BT Openreach are doing to try to turn this problem around. When I spoke to executives from BT Openreach yesterday, they made it clear to me that Northumberland was a future priority for them, and my constituents will be delighted if that is genuinely proven in the developments that we hope will take place.
We will need to look at not only the planning point I raised earlier, but how LEPs, and rural growth funds can support provision. We still have silos, whereby BDUK, BT Openreach and the Government are working in one silo, and the LEPs and others are working in another. It is extraordinarily difficult to get everybody in the same room, getting a holistic group view on the particular problem. Let me finish by mentioning the problem of towers and masts. My constituency has more than 50 masts belonging to various different parts of government, but it is extraordinarily difficult to get all those masts to sign for the provision, ultimately, of broadband.
Sir Robert Smith (West Aberdeenshire and Kincardine) (LD)
I am pleased to take part in this debate and I congratulate the hon. Member for Hereford and South Herefordshire (Jesse Norman) on securing it, because it has highlighted, across the Chamber, the need for broadband and mobile reception in rural areas, and the recognition that it is no longer a luxury, but a necessity.
Let me start by discussing the basic need for some kind of phone that connects someone’s house to the network and by reinforcing the concerns about the performance of Openreach in the most basic provision of phone lines, especially to new builds in the constituency. It has sometimes taken six months between someone moving into a house and their having a basic phone connection. We are talking not about superfast broadband or broadband, but a basic phone connection. Anything that the Minister can do to improve that performance will be welcome; the point has been made that such a connection should be treated like electricity and water as an essential service to the household. I hope he will also deal with the relationship between Openreach and the service provider in ensuring that the consumer gets compensation for a failure to deliver. Such compensation would help focus the mind and make some recompense for people not having that basic service.
As many have said, we still need to roll out basic broadband to many of our constituents. I remember that when the first roll-out took place the right hon. Member for East Ham (Stephen Timms) was the Minister. He was an extremely useful Minister for my constituency, because he dealt with broadband, post offices and the oil and gas industry, bringing together almost all the casework for someone dealing with a reserved section of the legislation, given that so many other activities are devolved to the Scottish Parliament. He was shown all the different innovative projects. At the time, Scottish and Southern Energy was going to do broadband through the electricity cabling, but suddenly the exchange in Stonehaven mysteriously reached the trigger point for BT to roll out ADSL. The point about competition and the importance of driving forward innovation has been made well in this debate. The wi-fi solution for many of those places still needing a broadband connection has been highlighted by others as an important way forward.
I particularly wish to reinforce the importance of superfast broadband to the north-east of Scotland, because with the oil and gas industry, there are a lot of businesses dealing with large amounts of data, and a lot of those businesses have grown up in rural parts of Aberdeenshire. Similarly, many people who work in the industry or work abroad could work from home if they had the proper superfast connections to deal with the data. The money that the UK Government have given to the Scottish Government needs to deliver on the ground for those people in the north-east of Scotland if we are to keep a vital industry effective, at its most efficient and raising more money for the tax system to reinforce investment in infrastructure.
The other challenge is not just the mobile phone reception from the network but the fact that many of the traditional houses are made of granite, which mobile phone signals cannot penetrate. The business centre in which the constituency office is based is a brand new building with high-quality insulation, which again cannot be penetrated by mobile phone signals.
Chris Bryant
The hon. Gentleman cites a problem that is very similar to the one that exists in the valley communities in south Wales. People cannot get mobile telephony inside their homes because their houses are made of stone or granite which cannot be penetrated by the signal. A possible answer to that lies in wi-fi, for which people need broadband. People end up getting hit by a double whammy.
Sir Robert Smith
The hon. Gentleman makes a point. There was also the illegal solution of boosters. Perhaps it is time for Ofcom to look at how mobile phone signals can be boosted in properties and business centres. Individual suppliers using wi-fi and broadband could be a solution—that could be the case for the business centre that I mentioned. There would need to be a signal booster for each network, but it should be looked at.
Let me reinforce the fact that broadband and mobile phone connections are not a luxury; they are essential. It is time that we saw delivery to those rural areas that missed out the first time round.
Mr Graham Stuart (Beverley and Holderness) (Con)
It is a pleasure to take part in this debate and to see in their seats so many parliamentary patrons of the rural fair share campaign. Although we are talking today about broadband and mobile coverage, we must see the matter in context. I congratulate my hon. Friend the Member for Hereford and South Herefordshire (Jesse Norman) on securing this debate and the Backbench Committee on its work.
Let us talk about context. It is a pity that we have no one other than the Opposition Whip and the shadow Minister in their place to hear this. The context is that people in rural areas are, on average, poorer than people in urban areas. They earn less; they have fewer services; they pay higher levels of council tax; and they suffer from lower funding of health, education, police and fire services. To add to that disadvantage, they find that they are in the 5% or 10%—whatever percentage it is in some grand number—that does not get the good thing that we are talking about. That merely compounds a disadvantage that is to be found in so many areas already.
What we need to do from the rural interest point of view is recognise that rurality is a need in the same way that deprivation is a need. It drives cost in the way that deprivation does, and we must make the case. We must have a broad understanding of the needs of rural communities. Let me say to the Opposition Whip, who, unfortunately for him, is in his place, that when we were discussing the Government’s programme to bring decent broadband service to rural areas, one of his colleagues said that it would mean faster internet shopping for millionaires—he went on to say faster internet shopping for wealthy people. That is a misconception of the disadvantage and low income of so many people in rural areas. They are removed from services and removed from access. The one thing that they had hoped would close that gap is digital technology, but all too often that is closed to them as well. That is the context.
Rory Stewart (Penrith and The Border) (Con)
Given that the fundamental challenge of rural areas is the barrier of distance, surely what we need to emphasise is that there is nothing more powerful than the technology of broadband and mobile in overcoming that barrier and in bringing rural areas all the opportunities of networked lives.
Mr Stuart
My hon. Friend is right. I pay tribute to him for how since the moment he was first elected and arrived in this Chamber—and probably before that—he has taken seriously the need to get broadband into his rural constituency. It was a privilege to attend a conference that he organised for hundreds of people in Cumbria some years ago to highlight exactly this problem.
I want to move on to talk about the long-term economic plan. When we consider the economic needs of the nation, one thing we see is that there is a productivity gap between urban and rural areas. The analysis of why that productivity gap exists shows that the problem is connectivity. It can be about highways and railways and buses, but, as my hon. Friend the Member for Penrith and The Border (Rory Stewart) rightly says, it is also about the digital divide. That is why if we are to have an equitable country that is fair to all and that closes those gaps, we must prioritise this issue.
My hon. Friends must realise that after 13 years of the previous Government—understandably, as we can see the level of interest in rural issues among Opposition Members—fewer than half of all households, and those the easy and commercially available households, have superfast broadband. It is this Government, who in so many ways have had to do the heavy lifting, who have taken that figure to three quarters of households and who, by 2017, will be delivering 95% coverage. As has been said, I am concerned about the other 5%.
Mr Stuart
I will give way to the shadow Minister and I hope that he will apologise not only for the failure of members of his party to take an interest in this vital issue but for the fact that in government—perhaps preoccupied with other matters—Labour did not focus enough on the needs of people in rural areas or recognise the disadvantage there.
Chris Bryant
I am sort of grateful to the hon. Gentleman for giving way, but I was not going to make a very aggressive point. I was just going to suggest that he might correct his figures. Superfast broadband is not the major issue that most people have been complaining about in the debate. The complaints have been about getting even to 2 megabits per second. Our ambition, which we would have secured, was to reach that speed for everybody by 2012 and it was his Government who abandoned that target.
Mr Stuart
With respect to the hon. Gentleman, the only people I have heard who felt that that programme was on track to be delivered were representatives of the Labour party. It is a shame that there are not more of those representatives in the Chamber today to intervene and explain precisely how it was going to be delivered. The hon. Gentleman is an excellent advocate for a difficult cause, and I respect that as a politician, but the truth is, as he knows, that the record of his party was weak. The record of the Conservative party is distinctly better, but we should recognise the context. We are all saying to the Government and to the Minister that it is not enough; we must go further and that is why we are here today. It is great to have the shadow Minister here today, even if we do not have any of his colleagues—[Hon. Members: “There is one!”] I apologise.
We have the opportunity to put an ambitious aim in all the manifestos. Let us ensure that people are not isolated and that we close the gap.
Mr Heath
May I take the hon. Gentleman back to the question of the economy and growing businesses? One quick boost that we could give to a lot of small businesses would be to encourage entrepreneurs who want to provide broadband by a wi-fi connection to places that will never gain from 3 miles of copper cable to the nearest exchange. I met such an entrepreneur only last week who was to provide for about half a dozen villages in my area. I would love to point him towards the Government funding that would give him the start that would enable that to happen, but at the moment it is not obviously there.
Mr Stuart
My hon. Friend is quite right. One of the challenges for the Government is that they are not very good at dealing with small organisations. I have a company offering a service in my area called Quickline. It contacted me and said that it would love to launch a hub in a local pub and then to offer it out to the surrounding community. I was rather rotten to the person who approached me, as I thought they were looking to do it somewhere quite close to Beverley, which would be easier. I said, “What about Holmpton, down near Withernsea?” I thought that it was about the most challenging place I could find for them and, to be fair, they agreed. The George and Dragon had that hub installed a couple of years ago and provided the offer in an area that was otherwise a not spot. It is difficult for Government, who have to secure and assure the use of public money, but we must find a way of dealing with small companies, some of which might go down as well as up. We must take some risks if we are to deliver this goal.
Nicola Blackwood
I could not agree more that connectivity for rural businesses is an essential service. Does my hon. Friend agree with me that the rural broadband voucher scheme, which is used in Oxfordshire to provide small businesses with up to £30,000 to pay for superfast broadband connections, has been a really valuable scheme? It expires at the end of March, and it would be helpful to know what might replace it.
Mr Stuart
My hon. Friend has put that on the record and I am sure the Minister will try to answer. I hope he has time to answer the many questions that have been raised.
As we know, the 95% delivery target for phase 2 funding is a national target, and obviously there are fears among colleagues that the 5% figure may turn out to be larger than that in their area. The aim was that the funding for that, for which £5 million came to the East Riding, should be matched—it is a shame to see that there is not even a shadow Minister now, just a Whip, however marvellous he may be, which he is, of course. However, East Riding of Yorkshire council is struggling to find the other £5 million, so there is a danger that we will not get the 95% provision.
What can be done to make sure that we target the most hard to reach? It does not matter what we are dealing with, whether it is the DECC work to reduce home energy use or anything else, the tendency is to pick off the low-hanging fruit, the easy targets. Somehow we need to design a system that starts with the most difficult-to-reach properties and works back. That way, we are the least likely to do as my right hon. Friend the Member for Arundel and South Downs (Nick Herbert) said, which is subsidise something that would happen anyway and not target the money on those who need it the most. That is important for the future.
It is estimated that by 2024, the Government’s current investment in faster broadband will be boosting rural economies by £275 million every month—not each year—which is about £9 million every day. It makes economic sense as well as good social capital sense to make the investment. Will the Minister update the House on the innovation fund we have heard about today, which is available for alternative technology providers who can then come up with innovative and radical approaches to reach the most remote communities? If he can do that, we will be grateful. Is there a prospect of the fund being increased?
I was delighted to hear that the Minister secured a landmark deal with mobile networks to improve mobile coverage across the UK. I mentioned earlier that, following that agreement, Vodafone will be extending 3G coverage in my constituency from just over 20% now to 99% by 2017. That is a significant move forward.
What are the Government doing to ensure that broadband infrastructure is available in areas where it would not be commercially viable for companies to install it? Also, as the Environment, Food and Rural Affairs Committee report today asks, is enough being done to hold BT to its promises? What about commercial plans from providers such as Kingston Communications, in our area? In those areas where the commercial providers said provision was commercial, they have not always fulfilled that, and then moved on. We need to make sure we have a system in place that holds them all to account, but I congratulate the Government on doing so much more, despite the chuntering from the Opposition.
Eric Ollerenshaw (Lancaster and Fleetwood) (Con)
It is a great pleasure to follow yet another Yorkshire MP. I congratulate my hon. Friend the Member for Hereford and South Herefordshire (Jesse Norman) on instituting what I think has become an annual debate, with the annual roll-out of the Minister.
I am sure the Minister has a good idea of some of the things I am going to say, but before I go into what are essentially concerns about rural roll-out, I will add my voice to the view expressed by my hon. Friends the Members for Newton Abbot (Anne Marie Morris), for Hexham (Guy Opperman) and for West Aberdeenshire and Kincardine (Sir Robert Smith) about the need, if we are building these thousands and thousands of new houses to try to make up for the previous Government’s failure, to make this fourth utility part and parcel of the build scheme. It seems incredible to me that it is not. I understand that the Government are looking into it, but it should already be in planning policy that these connections should be part of future building schemes.
At the moment in Lancaster, where we have large regeneration schemes going on, people are moving into flats or houses and discovering that they have no connection and that individually they have to find a way to get connected. That is amazing in the 21st century, especially in apartment and flat-style properties, and it is something the Government need to get a grip on through planning policy.
Caroline Nokes
Does my hon. Friend agree that it is surprising that developers are not more keen to ensure that their properties have the capability to be connected to the network, which is a selling point?
Eric Ollerenshaw
I agree, but that is not happening. The market is not yet delivering. Where it is not delivering, the Government should be delivering, in terms of planning regulations at the very least.
On the roll-out of broadband, to be fair, the Government took the decision in 2010, which we all welcomed, to do something for that section of the rural community that had been left out for so long, as my hon. Friend the Member for Beverley and Holderness (Mr Stuart) pointed out. Villages in Lancashire are being connected. It may be fast or slow in certain areas, but some of those contracts are being delivered. As the Minister knows, I, like other hon. Members, was concerned about the missing 5%. I was approached by a group led by Professor Barry Forde of Lancaster university, who said that the BT contracts could not work because of the copper to fibre issue, so BT would be unable to deliver the speeds that it had promised. [Interruption.]
Mr Vaizey
I would be happy to offer my hon. Friend a glass of water for his cough, but we are out of water. I see that the military prowess of my hon. Friend the Member for Penrith and The Border (Rory Stewart) has kicked in—he is bringing a glass of water.
As you well know, Mr Deputy Speaker, I was up in your constituency just this week, and a beautiful part of the country it is.
Mr Vaizey
I am sorry—last week. The weeks tend to blend into one. Some £50 million, 98% coverage in Lancashire, and 150,000 premises—that has to be something to shout about, and I know that my hon. Friend the Member for Lancaster and Fleetwood (Eric Ollerenshaw) will do so once he has had a drink of water.
Eric Ollerenshaw
I am grateful for the Minister’s intervention. He is right, and I paid tribute to that.
Back to the missing 5%: the group led by Barry Forde suggested that it would take up the 5% with a not-for-profit social enterprise and deliver hyperfast super-broadband—that is, 1 gigabit—to every property within a defined area. The group approached me as a constituency MP. The group eventually became known as B4RN—Broadband for the Rural North. I can tell my hon. Friend the Member for Skipton and Ripon (Julian Smith) that B4RN does not lie between Lancashire and Yorkshire. It is based in Lancashire, but gives some help to Yorkshire, as usual.
What the members of the group proposed to do seemed incredible at the time, but they have set about doing that since 2010 and have now wired up every single property in the villages of Arkholme, Abbeystead, Aughton, Capernwray, Dolphinholme, Gressingham, Newton, Docker, Littledale, Quernmore, Roeburndale, Wray, Wennington and Tatham, and soon to be connected are Melling, Whittington and Wrayton. The group is looking to wire up 2,500 people with 1 gigabit of speed. Already we have interest from businesses, doing the very thing that my hon. Friend the Member for Beverley and Holderness hopes will happen, which want to move into the area that B4RN covers because of the potential offered by this hyperfast broadband delivery.
The history is interesting. When the group decided to do that in 2010-11, members applied for some of the funding from BDUK, but the district council and the county rolled up all the funds and gave all the grants to BT, which resulted in B4RN complaining to the European Commission about the use of state aid. B4RN agreed to drop the complaint provided that the county would protect its postcode areas, as against BT’s scheme.
Hon. Members have mentioned the situation of BT, and I have brought up before the near-monopoly that exists.
Eric Ollerenshaw
I stand corrected; it has all the features of a monopoly. Let me give an example. One of the villages supposedly in the BT area is Dolphinholme, which lies between two villages that B4RN was going to wire up, so its wiring went through the village. Villagers there had been waiting for BT, but it had not yet turned up, so they asked B4RN to connect them. B4RN then began connecting those people who requested it. BT has since moved into the village and, instead of just replacing copper with fibre, is wiring the node all the way through in a way that it has not done anywhere else in Lancashire, and all for a village of just over 200 people. Why is that? It looks as though that multi-million pound business is trying to squeeze out a voluntary, not-for-profit organisation that is proving extremely successful.
Guy Opperman
The thrust of what my hon. Friend is saying is that BT will do anything it can to drive out alternative providers in our local areas.
Eric Ollerenshaw
Absolutely. As we have heard hon. Members shout from across the Chamber, it is the behaviour of a monopoly.
Another characteristic of a monopoly is a lack of transparency. Let me give another example. Two weeks ago a resident of the village of Scorton, which was to be wired up by BT, approached me to say that he was having problems getting in touch with BT to find out what was going on. He runs a medium-sized engineering company from home with national contracts. I took the first step of any constituency MP and asked BT what was going on. I was told that there were technical difficulties. Eventually, I went to meet the resident in Scorton and found that he had been told that BT was now de-scoping the area because it was too difficult—I had been told one story, and he had been told another.
I am still waiting, three years down the line, for BT to hand me a map showing exactly what it is doing. Let me explain to hon. Members that these are villages up in the Pennines. Then there are places, such as Glasson Dock, which lies on flat land on the coast just beyond Lancaster, that BT is not wiring up, even though there are more residents there than in Dolphinholme, where it is delivering fibre, fibre, fibre. I know that the Public Accounts Committee has looked at the situation, but I would ask it to look again at the BT situation.
Eric Ollerenshaw
I beg to differ. Perhaps the Select Committee that looked at it here could recall BT. I have made inquiries about how to get the competition authorities to look at the situation. This is the behaviour of a monopoly: there is no transparency, we are not being told what is going on, and indeed we are being given disinformation.
Eric Ollerenshaw
No, because I know that the Minister is not complacent, and I know that delivery across most of Lancashire is extremely effective, as the hon. Gentleman would have heard had he been here at the beginning. What hon. Members here are concerned about is the last 5%. I ask the Minister once again to look at BT’s performance in that remaining area.
Mr Deputy Speaker (Mr Lindsay Hoyle)
Order. At least three Back-Bench Members still wish to speak, so I am reducing the time limit to five minutes from now.
John Glen (Salisbury) (Con)
It is a pleasure to contribute to this debate. I congratulate my hon. Friend the Member for Hereford and South Herefordshire (Jesse Norman) on securing it once again. The real challenge, as we have heard in contributions from across the House, is the remaining 5% and the pitch of frustration our constituents feel when we do not see sufficiently rapid movement, when there seems to be a lack of reliable information and when they cannot get the answers they so desperately need. A significant portion of the e-mails I receive relate to the remaining 5% in south Wiltshire.
Connectivity is an essential part of our daily lives—it is the fourth utility—but it has not existed reliably in some parts of my constituency. Just a few months ago, residents in Bishopstone and Coombe Bissett were cut off completely from the outside world when there was a fault on their main telephone lines. Neither village has mobile phone coverage, so the loss of the connection left elderly residents unable to reach their panic buttons, employees unable to pay their tax bills, and at least one local business on the verge of collapse. This happened four and a half miles from the city of Salisbury. That is why we need to look carefully at all the options that exist at this point in the delivery of the roll-out to maximise broadband, and 4G, coverage.
Rural communities are resilient and innovative, as several colleagues from across the House have said, but we must do more to help them benefit from creative solutions. Two villages in my constituency, Broad Chalke and Winterslow—I thank the Minister for visiting Winterslow a couple of years ago—have benefited from Vodafone’s Rural Open Sure Signal programme, which provides 3G coverage to sparsely populated areas that otherwise would have none. That has had a transformative effect. The simplest tasks, such as schools phoning parents when their children are ill, or lost delivery drivers getting in touch, were impossible without this technology. It is imperative that we continue to look creatively at other solutions that might exist and that we do not offer inferior solutions on the grounds of cost alone, and cost as it is today.
One of my constituents who is a dedicated campaigner for better connectivity in rural areas has lived with satellite broadband for nine years. That system relies on individual packets of data being sent about 44,000 km from a satellite. He tells me that while the system functions well when downloading large files, the delay in these packets of data makes everyday browsing or video streaming very difficult. I therefore urge the Minister to ensure that alternative solutions are also on the table. I am aware that the Government have put £10 million into the pilot schemes in rural areas using different technologies, and that they will be evaluating the success of those different pilot schemes. I echo the comments of hon. Members who said that more needs to be allocated to that initiative, because that is where the last 2% or 3% are going to find their solutions. There are improvements in technology all the time, and the Government need to be right on top of the best solutions as they come into existence.
By sheer coincidence, my constituent had a new 4G mast erected close enough that he could benefit from it. I want to highlight to mobile phone companies, and to the Minister, the immense opportunity that exists in this regard. There are areas of the country that will not be able to benefit from fibre broadband cost-effectively but where 4G could provide an answer. That can be nothing short of transformative for these communities, and, as my hon. Friend the Member for Cities of London and Westminster (Mark Field) said, for urban areas as well.
I hope the Minister has listened carefully to the intense and sincere speeches that have been made, because there are serious issues for constituents across the country who are so frustrated when they cannot get this matter resolved. We need to make sure that we use the new technologies and that they are delivered as quickly as possible. We should welcome the fact that only 3% of premises in the UK are now suffering speeds below 2 Mb, down from 11% in 2010, but let us not be complacent. Let us do as much as we possibly can to speed up the roll-out for the last 5%, or even the last 2%, who we all intensely fear will never get a solution.
Robert Jenrick (Newark) (Con)
Some right hon. and right hon. Members will be surprisingly familiar with my constituency, including the hon. Member for Rhondda (Chris Bryant), although I will not dwell on the result of his leadership of the Labour campaign in the by-election. As they will know, the constituency is predominantly rural, with more than 150 villages, from the suburbs of Nottingham going up through north Nottinghamshire. Our second-largest employer is Vodafone, which employs more than 500 people in the town of Newark. My predecessor and I have had an extremely good and productive relationship with the company. There has been good news, which I will come to, but there are a number of concerns.
Robert Jenrick
I will deal with that last.
During his Westminster Hall debate, my hon. Friend the Member for Hereford and South Herefordshire (Jesse Norman) set out eloquently the moral and economic case for broadband in rural areas. It is not just about isolation, but about enabling people to lead full lives in an interconnected world and to consume the news, learn, be economically active and connect with relatives who live around the country and the world. I am part of perhaps the last generation of MPs to have known the world before broadband, and the opportunities it presents are immeasurably greater than those I knew as a child.
The greatest barrier to aspiration and meritocracy is lack of information. Individuals frequently set their horizons according to the world they know and have it broadened by more information and knowledge about which university to go to and which employer to seek out. It is no exaggeration to say that broadband access is about giving young people and people of all ages the benefits of the rich possibilities of our interconnected world. Not having those opportunities has a major effect. It is also evident that such access is about economic growth. The 150 villages in my constituency are brimming with small businesses, entrepreneurs and communities that want to get on and succeed, but they are being held back, with one hand tied behind their back, because of a lack of broadband access.
This is also about closing both the rural-urban gap and the north-south divide. Some 350 people commute from Newark to London. That is a difficult journey to make every day, but it can be made regularly if people can work from home with good quality broadband.
Nottinghamshire county council has made good progress in recent years. I pay tribute to Nicola McCoy-Brown, my contact at the council, and the £20 million better broadband for Nottinghamshire programme. A number of villages, including Collingham, have seen huge improvements in recent years, but a huge amount of work remains to be done. More than 40 villages in my constituency have little broadband, certainly not enough to run a business or to work or do proper education from home.
I want to raise a few concerns. The first is whether all the public money is being well spent. Those Members familiar with my constituency will know that a vast swathe of it is, in effect, made up—my constituents will not thank me for saying this—of commuter villages that are almost the suburbs of Nottingham. I am surprised that those villages are deemed not economically viable for BT to be able to supply them. I suspect that East Bridgford, Bingham and villages surrounding Southwell are economically viable and that BT is not using public money appropriately.
Secondly, the figures of 5% and 10% are frequently misused, because they are denoted by county and local authority. The result for local authorities that are predominantly urban, such as Nottinghamshire, is clearly very different from the result for those that are predominantly rural. My constituency is the 10% that is rural in Nottinghamshire, so the definition of what is rural and remote in Nottinghamshire is different from that in Herefordshire, Wales and Cumbria. In fact, a vast swathe of that 10% is not particularly rural or remote at all. I think the definition is misused.
I entirely endorse earlier comments about linking mobile and data. Smartphones are ubiquitous in my constituency, but no one can use them, even in Newark town. They are sold in all the shops by all the dealerships, but no one can use them.
Time is against me, so I will finish by addressing Openreach. The company claims not to be a monopoly, but it displays all the characteristics of one. I know this issue is market sensitive, but I urge the Minister to look into it. For good business reasons, the organisation needs to be separated from BT and broken up. In the short term, I urge the Minister to do something about the appalling customer service at Openreach and to encourage it to treat its customers with the respect and dignity they deserve.
Alistair Burt (North East Bedfordshire) (Con)
I have followed the debate carefully and was not sure whether I would have time to speak, so I am delighted to be the last speaker from the Conservative ranks. My speech will, of course, commend the Government for the extraordinary work they have done on broadband, while suggesting one or two changes that will make all the difference.
I congratulate my hon. Friend the Member for Hereford and South Herefordshire (Jesse Norman) and the Backbench Business Committee on initiating this debate. The response from the House has made it clear that he touched on a number of issues that are common to those of us who represent rural constituencies, wherever we sit in the House, and it has been essential to get the matter before the Minister and the House.
My constituency exhibits a number of characteristics that we have heard about, such as properties with fewer than 2 megabits in local authorities that I represent—that affects 8.6% of properties in Central Bedfordshire and 12% in Bedford borough. Again, the same properties tend to miss out, and the hard to reach are genuinely hard to reach.
I have an inventive and thoughtful community that has tried all sorts of different things. It is effective at putting a case together and has detailed plans. I have attended two public meetings in the village of Colmworth and heard a very detailed description of its business premises, residential areas, and the needs of such a rural area. North East Bedfordshire has a diverse community that depends on a relationship between the rural and the urban, as well as on connectivity. The opportunity to work there is becoming even more essential.
Let me say two slightly controversial things. First, I praise BT’s regional partnership director, Annette Thorpe, who has worked incredibly hard with people in my region. I have met her more than a handful of times in different villages in my constituency. She has tried to meet some of the problems, but the difficulty has been that BT is overstretched. It has had too much work and has not been able to deliver, and it has been a problem to satisfy expectations. Annette Thorpe has worked extremely hard to do all she can.
Secondly, my hon. Friend the Minister has been a victim of his own success. The Government inherited a poorly developed programme from the previous Government—whatever the hon. Member for Rhondda (Chris Bryant) says—and they have made remarkable steps forward. However, there is so much work to do and a limited number of people to do it, and it has not been possible to deliver everything we wanted. Communication has been crucial. In Bedford, BT has been struggling to deal with the volume of open market review requests and invitations to tender. That has resulted in it trying to make sense of its own data, which has held it back from the next steps it needs to take. The sheer volume of work being done has caused it to become a victim of its own success.
As well as the familiar issues that colleagues have mentioned, there are some new ones. BT has realised that even when it gets to the end of its programme, it might not be able to deliver. There are some properties it just cannot reach, so what is to happen to them? If it does succeed in delivering 2 megabits, that will not be enough for existing technology, and the issue must be thought through.
A further problem that we have not spent much time on concerns new developments in rural and market town constituencies. King’s Reach in Biggleswade is a new development on the edge of my largest town with 20,000-plus people, and they find it hard to get broadband and superfast broadband. I pay tribute to that community, which worked incredibly hard, and particularly to Councillor Bernard Rix, who led the work with BT, and my assistant, Mandy Setterfield. We have worked with Annette Thorpe—sometimes behind the scenes—to push things along, but there have been problems with siting cabinets and getting new properties linked up. When talking about linking up the old, we must not forget that we must also deal with linking up the new.
Finally, I would like to take up the kind offer of my right hon. Friend to meet representatives from my constituency.
Mr Deputy Speaker (Mr Lindsay Hoyle)
I am sorry that we have lost a minute because we may lose another speaker. I am sure that could have waited.
Alistair Burt
If the Minister would kindly meet a group that represents not only the older rural areas that are trying to be connected, but representatives from the newer areas, I am sure he will understand our problems, including those in Dunton, which thought it was on the list and has now been bumped off. I am very grateful for the time of the House and to my hon. Friend the Minister, who should be my right hon. Friend very soon.
Mr David Heath (Somerton and Frome) (LD)
As a brief coda to this excellent debate, I do not believe the Minister doubts my commitment to broadband in rural areas. We have spoken many times about it. I am grateful for his commitment to the roll-out of the programme across the country and what the Department for Culture, Media and Sport has done. I used to have meetings with him as a DEFRA Minister. The two Departments energised each other in those meetings.
I am grateful to Somerset county council, of which I am sometimes critical on other matters. It has pushed strongly, but the fact remains that, despite its best efforts, very substantial parts of my constituency will still not get high-speed broadband in the initial roll-out. Often, they are the same parts that do not get mobile phone coverage.
The Minister made a brilliantly witty speech at the opening of the Haynes International Motor museum in my constituency, but if he had any doubts, he heard directly from my constituents how important broadband is to us. It is important for them in their domestic circumstances and important for their businesses.
We must now concentrate everything we have in Government and local government on ensuring that the bits that will not be reached catch up with the rest. That will not mean extending the BT contract, even if we know where the boundaries of the contract lie. It will not mean getting more large companies engaged in programmes across the country. It will mean stimulating many small businesses to provide wi-fi connections to small groups of villages, to provide the plugs to fill those gaps. We need to find the mechanism that makes that work effectively. If the Minister can do that in his remaining months in his current position, I will be eternally grateful to him. I may even take him up on the offer of meeting him with a few of my constituents to make the point yet again.
Chris Bryant (Rhondda) (Lab)
I agree with the hon. Member for Beverley and Holderness (Mr Stuart). At times, I have felt as if I have walked into a meeting of the 1922 committee this afternoon—it has been a congregation of the excluded, the dispossessed and the disconnected. I should tell all hon. Members who have complained about the last 3% or 5% that I feel their pain. I recommend that they vote Labour at the general election because that is the only way they will get this sorted out.
For once, it is not just about the many, but about the few. As many hon. Members have said, mobile telephony and broadband—superfast broadband—are not luxuries any more. They are a fundamental and essential utility. People have a right to expect both in residential properties, and businesses have a right to expect them. As the hon. Member for Newton Abbot (Anne Marie Morris) said, many business parks are still not connected. Incidentally, ensuring that that is rolled out is the strongest argument for state intervention. That is one of the things we need to look at.
If hon. Members watched “Last Tango in Halifax” on Sunday evening, they will know how important mobile telephony is. A wedding might all too easily be cancelled because somebody did not manage to send a text message or get mobile coverage to be able to say, “I’m on my way.”
For that matter, in many places in the country, if people want to watch “Last Tango in Halifax” half an hour or an hour later on iPlayer, they would have to have 2 megabits per second at least, and yet, as many hon. Members from parties on both sides of the Chamber have said, too many people cannot even get that 2 megabits per second. If somebody is upstairs watching YouTube on a tablet, somebody is downloading something on their smartphone and somebody else is watching iPlayer through their smart TV, even 5 megabits per second might not be enough because of contention ratios. Even when the technology has been rolled past their door, many people are not connected, either because they do not know the benefits or simply because there is not enough competition in the market to make it cheap enough for them to afford.
I warmly congratulate the hon. Member for Hereford and South Herefordshire (Jesse Norman) on introducing the debate. I know the problems in his constituency, because when I stayed there for the Hay festival last year, I had absolutely no means of finding the place where I was going because Google maps gave up on me, because there was no connectivity. I think Edmund Burke would have been proud of him. I am not sure Burke had a lot to say about mobile telephony, but he was quite keen on connections. After all, he said:
“The only liberty…is a liberty connected with order.”
I want to talk about the Government’s record. Hon. Members have snuck around the corner here a little bit. In essence, they know that most of what they have argued this afternoon is a criticism of the Government’s record. They have not put it in such terms, because they know there is a general election coming.
Chris Bryant
I will not give way if the hon. Gentleman does not mind, because we want to get on to—
Mr Deputy Speaker (Mr Lindsay Hoyle)
The hon. Gentleman has only just walked in.
Mr Deputy Speaker
Just for clarification, normally you do not walk in and intervene, no matter if you have spoken earlier. The convention is you at least hear a little bit of the new debate.
Chris Bryant
On the Government’s record, I think what everybody has said today is that we have to take the whole country with us. That means 100%, not 93% or 95%. I merely point out to hon. Members that the original target was 2 megabits a second by 2012. That was abandoned by this Government, who moved the target to 2015. Now, the target has been moved to 2016. I suggest that that means we want lots of people to be able to run before some people are even able to walk in the digital economy, and I think that that is a mistake.
The superfast target of 24 megabits a second has also been changed. It was 90% by 2015. Then, when the Government worked out that that simply was not going to happen, for all the reasons hon. Members have set out today, they moved it to 95% by 2016.
Chris Bryant
The hon. Gentleman will be speaking in a few moments and we wait with bated breath. If he can bate his breath, I will bate mine.
When BT appeared before the Select Committee it said that we probably would not get to the 90% target until 2018, so there are problems. The Committee was absolutely right when it reported today that
“Repeated changes in target dates for rollout of superfast broadband inevitably reduce confidence that coverage will be achieved on time. They also leave those in the hardest-to-reach areas uncertain as to when their businesses will be able fully to engage with digital practices.”
The Committee, which is made up of all political parties in this House, is absolutely right.
There are key decisions that I think the Government have taken ill-advisedly. The most important in terms of mobile telephony roll-out—the hon. Member for Newbury (Richard Benyon) effectively referred to this—is in relation to the electronic communications code. There are landowners in the country who have made it phenomenally difficult to put up a new mast or increase the size of a mast. The provisions in the electronic communications code need to be more like those that exist for electricity and water—the common utilities that we absolutely need—than as a luxury, which was how mobile phone telephony was originally looked on. The Government got the Law Commission to report two years ago on the electronic communications code. Only at the very last minute did they table very poorly drafted amendments to the Infrastructure Bill. They could have been on the Order Paper to be properly considered in the normal way a year ago. If hon. Members really want to tackle the problems of mobile telephony coverage across the country, they have to deal with the electronic communications code. The Government have misplayed this matter completely.
Incidentally, the hon. Member for Newbury said that we had to listen to the silent majority. I am not quite sure how one listens to silence. Maybe the point is that the silent majority are not connected and so do not have an opportunity to tell us what they think.
Another failed programme from the Government was the £150 million mobile infrastructure project. One hon. Member gently suggested that it is a bit of a failing if only two masts, serving another 400 homes, have been put up in all that time. That is not a slight failure—it is a massive failure. The Government should be coming to the Dispatch Box to hang their heads in shame.
Another £150 million has been allocated to the super-connected cities programme, but why just cities? Why did they decide to give out vouchers only for superfast cities? Why not the whole country? I represent an area—
Chris Bryant
No, I will not give way to the hon. Gentleman. We are going to hear from the Minister—
Mr Deputy Speaker (Mr Lindsay Hoyle)
Order. Look, this debate is not going to degenerate now. If the Minister can control himself, he will be on shortly, and if Back Benchers want to intervene, will they please do it in the correct manner?
Chris Bryant
No, I will not give way to the hon. Gentleman. He might recall refusing to give way to me earlier. Had he been a little nicer then, I might have returned the favour.
The Government allocated £150 million to the super-connected cities programme, but what did they do? They hid their light under a bushel—they did not tell anybody about the programme—and guess what? Nobody applied for the vouchers. The hon. Member for Skipton and Ripon (Julian Smith) complained that we objected to the advertising programme. That is completely wrong. He should read his briefing note from the Whips a little more carefully. We complained there was no advertising, which is why there was no take-up and why, of the £150 million, so far only £20 million has been spent. That is another failure from the Government.
On the tender process, I accept the point about having local communities drive the agenda rather than a national statist agenda, but I gently suggest that if we set up 44 separate areas, it will be almost inevitable that the only people able to compete with a company such as BT will be those with very deep pockets who could be almost certain of getting several contiguous tenders, and that was never going to happen. In effect, it resulted in a licence to create a monopoly, and where we have a monopoly, we need tough, serious rules to ensure greater competition.
The hon. Member for Lancaster and Fleetwood (Eric Ollerenshaw), who lost his voice and was helped out by the Minister, made a sensible point about the lack of competition across the whole area, particularly in the provision between the cabinet and the home. That was exactly the problem with the incident he related about the company called B4RN. The other problem is that we are falling far short on take-up compared with roll-out. A far better economic model would be to drive roll-out by encouraging take-up, because people would understand what we need all these megabits for. People hear us talk about 24 megabits, 30 megabits, 50 megabits, 100 megabits, 1 gigabit, but actually nobody knows what we are talking about.
Chris Bryant
The vast majority of people have no understanding of what we are talking about, which is why we have very low rates of take-up.
The Government have taken some very wrong steps. For one, they ruled out wireless at the beginning. It is a delight that there is now a £10 million pilot looking at wireless solutions, but it should have been in existence in 2011-12. It is too late now. It is wrong only to look at fibre to the cabinet, and not fibre to some properties, because the simple truth is that people whose houses are a long way from the cabinet will never be part of superfast broadband under the programme as thus exemplified.
As I have said, there is next to no competition. If the Government are to spend the best part of £500 million of taxpayers’ money—most of it coming off the licence fee—they need to make a strong argument that it is meeting market failure, and I think that when they advanced phase 2, in particular, of superfast broadband without a proper business plan, they failed to prove it was meeting market failure. There is no evidence that this is meeting market failure, rather than simply helping BT make investments it would have made anyway.
We should be one nation, not digitally divided or disconnected. We should embrace the words of E. M. Forster in “Howards End”: “Only connect”.
The Minister for Culture and the Digital Economy (Mr Edward Vaizey)
Let me begin by saying how grateful I am that the hon. Member for Rhondda (Chris Bryant) mentioned E. M. Forster, because my late father campaigned for a blue plaque for E. M. Forster, which can now be seen on the flats in Arlington Park mansions in Chiswick. That is an aside, but I always like to mention my old dad, my late father, who was in the other place. I usually get to mention him during steel debates, but I digress.
We have had an excellent debate with some 18 contributions, most from the Conservative Benches because only one Labour Back Bencher showed up to make a speech. That gives the lie to the Opposition spokesman’s protestations that Labour is interested in rural communities and interested in getting broadband to them.
We heard excellent speeches from my hon. Friend the Member for Hereford and South Herefordshire (Jesse Norman), who called this important debate, and the hon. Member for Barrow and Furness (John Woodcock). We heard my hon. Friend the Member for Shrewsbury and Atcham (Daniel Kawczynski) talking about his area’s local enterprise partnership. We heard from the hon. Member for Na h-Eileanan an Iar (Mr MacNeil) and from my right hon. Friend the Member for Arundel and South Downs (Nick Herbert), who made some important suggestions. We heard the hon. Member for South Down (Ms Ritchie), who contributed to the EFRA Committee report, which to a certain extent sits behind today’s debate.
We heard from my hon. Friend the Member for Skipton and Ripon (Julian Smith), who has pioneered broadband in North Yorkshire, and from my hon. Friend the Member for Newbury (Richard Benyon) who spoke about Vodafone. The hon. Member for Argyll and Bute (Mr Reid) came up with a new acronym—MBORC, which I shall investigate—while my hon. Friend the Member for Newton Abbot (Anne Marie Morris) quite rightly started by praising the Government.
We heard from my hon. Friend the Member for Hexham (Guy Opperman), the hon. Member for West Aberdeenshire and Kincardine (Sir Robert Smith), my hon. Friend the Member for Beverley and Holderness (Mr Stuart) and from my hon. Friend the Member for Lancaster and Fleetwood (Eric Ollerenshaw), whose contribution I always intensely enjoy. We then heard from my hon. Friends the Members for Salisbury (John Glen) and for Newark (Robert Jenrick)—it is the first time I have heard the latter speak, and what an excellent contribution it was.
We then heard from my right hon. Friend the Member for North East Bedfordshire (Alistair Burt) and, of course, from the hon. Member for Somerton and Frome (Mr Heath) who I always remember saying—although not in this debate—that the only way he can get a signal is by standing on his kitchen cabinet.
In the time available I cannot answer all the questions put to me, but I hope that in the course of my response some of the issues will be covered. If they are not, I will write to each and every hon. Member who has made a contribution to this debate.
Let me begin with the contribution of the hon. Member for Rhondda. We heard 10 or 15 minutes from him, but just as we searched the Benches behind him for any speakers, we searched for a policy in his speech—but policy could we find there none. Is it Labour’s intention, for example, to designate internet provision as a utility? Is it Labour’s intention to bring broadband to business parks? Is it Labour’s intention simply to provide broadband only where people say they want it, so that for the first two or three years of a Labour Government we would see a marketing campaign before any broadband was rolled out?
What are the Opposition’s positions on our policies? The hon. Gentleman lambasted us for not proceeding with the changes to the electronic communications code in the Infrastructure Bill, yet while it was still in the Bill, he was writing to the Secretary of State saying that Labour could not support it. The Opposition Front-Bench team has complained about the superfast broadband advertising campaign, yet now the hon. Gentleman claims that he wished we had advertised more.
I am afraid that the hon. Gentleman got his facts wrong when he said that we had moved the target. We had a target to get superfast broadband to 90% of the country by the end of 2015, and we have every chance of meeting that target. [Interruption.] I repeat that we have every chance of meeting that target. Then we set a new target of 95%—namely, getting to a further 5% of the country by 2016-17. That is not moving the target. The hon. Gentleman also said that we had ruled out wireless technology at the beginning; our approach has always been to be technology-neutral.
This broadband roll-out campaign is an unequivocal success. We shall very shortly announce that we have passed the 2 millionth premise as a result of the roll-out campaign. That means 2 million households—millions of people—now getting superfast broadband where the market would not deliver. Labour’s alternative policy was to give those people 2 megabits and then forget about it. Incidentally, Labour had no way of paying for it, as it had no policy to show how it would pay for this provision of 2 megabits. In fact, 97% of the country already benefits from coverage of 2 megabits, but we know—and all my hon. Friends know from their constituents—that that is no longer deemed to be enough. Most people now expect 7 or 8 megabits.
Some of my hon. Friends talked about future-proofing. In 2010, we thought that aiming for 24-megabit superfast broadband would be the right policy, but technology changes all the time. Members will have noted BT’s announcement last Friday that it expects to be able to achieve speeds of up to 500 megabits over a copper line, thanks to new technology that it is trying out.
In the past, we have been criticised by the National Audit Office for some aspects of our campaign. I have been robust in defending our programme against the NAO’s critique, and I am pleased to say that last week it praised the roll-out of superfast broadband. It made it clear that we were close to meeting our targets, and were providing value for money. For that I thank the men and women who work for BT, including the engineers who work tirelessly to produce superfast broadband. Over the Christmas period, I visited some of them in Steventon, which is in my constituency. More often than not, they exceed their targets and their reach. I also thank Chris Townsend and all my officials who run Broadband Delivery UK, as well as Bill Murphy, who had overall responsibility for the BT programme.
I think that this is a programme of which we can be very proud. It is being delivered by a great British company, BT, and I was not going to come to the House and run that company down. Let us look at the facts. Superfast broadband is now available to nearly 80% of premises, whereas fewer than 50% had it when we came to office. The United Kingdom has a higher superfast coverage than any of the other EU5 countries. Our average broadband speed has quadrupled over the last four years. We have the highest take-up of superfast broadband in the EU5 and the lowest priced broadband in the EU5 and the United States, and we have the largest number of broadband users in the EU5.
I understand the frustrations expressed by my hon. Friends, because those statistics point to the fact that we live in a digitally savvy nation, and British consumers want to use the internet. For example, they spend the highest amount per capita on e-commerce shopping. They are rightly demanding the provision of higher speeds and better service as soon as possible, but we are moving as fast as we can, and, as I have said, we are exceeding our targets and are well on track. As for value for money, the independent assessment review conducted for BDUK showed that, in the case of a range of cabinets, BT’s costs were 90% lower than those of a normally efficient operator, while the NAO reported that the average costs of a broad range of projects were currently proving to be about 25% lower than the estimated costs of bids for those projects.
So what are the issues? I have dealt with the issue of whether we have moved the target, so let me now deal with the issue of competition. Time and again, people ask me why there is not more competition, but what sort of competition do they want? If we had organised a national bid—if we had asked a company to tender to provide broadband on a national basis rather than for 44 areas—what would have happened if BT had won? We would have had a national provider. Do people think that we should have done it according to regions? Who is to say that BT would not have won those contracts? The 44 areas were small, and were open to smaller providers should they have wished to bid. The fact is that BT won the contracts because it provided value for money. That has shown us how tough it is to build the necessary infrastructure, for this is an engineering project that requires infrastructure build-up.
I will give the Labour party some credit: it did provide an element of competition. It had a digital region in south Yorkshire which went to a provider other than BT, and that went bust. We have had to pick up the pieces, and have had to write off £50 million worth of taxpayers’ money. That is the kind of competition that Labour provided. Nearly 95% of Cornwall, where BT won the contract under the last Government, now has superfast broadband speeds. It is one of the best-connected regions in Europe, and Cornish companies are saying that they have better broadband than when they go to Silicon Valley.
The other issue is customer service. That involves maps, which pose another dilemma. On the one hand my hon. Friends say, “We want maps to show exactly where people are going,” but then the maps are published and BT or the local authority get on the ground and they say, “Actually, this is not as viable as we thought and we’re going to move somewhere else.” That leads to disappointment. There is a balance to be struck, but as far as I am aware now almost all regions are providing maps of up to seven-digit postcodes.
Contrary to impressions, I am not the spokesman for Openreach and I share, as a constituency MP, the frustrations that arise with customer service. I cannot inform the House what proportion of bad customer service and good customer service there is, but we all know that constituents who get good service from Openreach are not going to e-mail us while those who get terrible service will, quite rightly, e-mail us and expect us to sort that out. I hold my hand up and say that I have had my fair share of people complaining about Openreach customer service.
I also share the frustration about new housing developments, and as a result we have got the telecoms providers around the table with the major housing developers and we have put in place a system whereby new housing developments are flagged up to telecoms providers.
Finally, the biggest point Members mentioned is of course the last 5%. Again, I absolutely understand the frustration of my hon. Friends, and all I would say is, “Meet me halfway.” We have never as a Government pretended we were doing anything other than what we were doing. We said, “We have the money to get to 90% and we hope to do that by the end of 2015.” The Chancellor saw how well the programme was going so he gave us more money. We then had the money to go to 95% and we will get there by the end of 2017. Then, to give great credit to the former Secretary of State, my right hon. Friend the Member for Basingstoke (Maria Miller), we said, “We want to get to the last 5%, but the back-of-the-envelope cost is huge—literally in the billions of pounds—so let’s do some research before we go back to the Treasury to say what it is likely to cost.” That is why we set up the £10 million pilot projects: we wanted to get on the ground and see what new technologies could deliver superfast broadband speeds to that last 5%. We do not want to leave the last 5% behind; by definition they are the most difficult and most expensive to reach, but we will get there.
Mobile is another huge issue. We have the fastest roll-out of 4G coverage in the world and the fastest take-up, and I hope my hon. Friends will recognise the superb legally binding agreement to extend that, which the Secretary of State negotiated with the mobile operators. By the end of 2015 we will have reached 98% of premises with 4G from the main operators, but this groundbreaking deal will see the geographic coverage over the two years after that—2016 and 2017—spread to 90% of the country, and it is not going to cost the taxpayer a penny. We have already pioneered it with the mobile infrastructure projects because we have prepared—[Interruption.] The hon. Member for Rhondda is misunderstanding annual licence fees. We have pioneered that with our mobile infrastructure projects because, again, we recognised that rural communities want mobile coverage, and we now have 100 sites ready to go.
It has been difficult, however, and my hon. Friends mentioned the difficulties we face with landlords, who see this as an excuse. In fact I was being told only today about a mast in the highlands that is damaged but which the company cannot get repaired because the landlords used its damage as an excuse to try to negotiate a higher rent. These are the kinds of issues mobile providers face up and down the country.
Finally, I commend the digital infrastructure document that we published today. We have been working in the last year to look at all the infrastructure networks the Government have a stake in, including the Network Rail signalling network, the emergency services network and JANET—the joint academic network for universities. We want to bring them together, to get that synergy that we have long called for.
I rest my case there, Mr Deputy Speaker.
Jesse Norman
I am grateful to my hon. Friend—I was in danger of being filibustered by my ministerial colleague. It is very good to know he shares our concerns about BT Openreach. That only raises the question of to whom he writes to express that anger.
We have had an excellent debate featuring many very powerful contributions, and it absolutely validates the decision of the Backbench Business Committee to give us this time. Many issues have been raised—economic, social and cultural, and affecting businesses, emergency services, utilities, health care, farmers, families young and old, and those learning, playing and working, all of whom depend on good mobile and broadband connectivity, and doubly so in rural areas.
We have heard about many serious concerns: not spots; the mobile infrastructure project; and Openreach. The point has been made again and again that broadband is not a luxury. I welcome the Government’s commitment; let them see it being pursued in future months and years.
Question put and agreed to.
Resolved,
That this House has considered rural phone and broadband connectivity.
Petitions
(9 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text
Tim Farron (Westmorland and Lonsdale) (LD)
I present a petition of more than 1,000 residents of Sedbergh in my constituency, which was collected by local volunteers led by Councillor Evelyn Westwood, against the plans of both NatWest and Barclays to close their branches in the town.
The Petitioners declare that,
the closure of both the Barclays and NatWest branches in Sedbergh would leave the town without any bank branch, causing an inconvenience for small businesses, vulnerable residents and the community of Sedbergh as a whole. The Petitioners therefore request that the House of Commons urges the Government to encourage the Chief Executives of both Barclays and NatWest to retain their branches in Sedbergh.
And your Petitioners remain, etc.
[P001424]
CCTV in Slaughterhouses
(9 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Henry Smith (Crawley) (Con)
I am grateful for the opportunity this evening to raise the issue of the need for CCTV to be installed and monitored in slaughterhouses, in an effort to better aid animal welfare.
I personally have been vegetarian for more than a quarter of a century, because I am concerned about animal welfare issues in the production of meat, and also for food and environmental sustainability reasons, but I recognise that the majority of people eat meat. However, I would contend that the majority of those people who eat meat want to know that their food is sourced to the highest standards when it comes to animal welfare.
Trainee slaughterers are tested to ensure that they know the laws relating to animal welfare before they are licensed, and yet when secret cameras have been installed in slaughterhouses, many of them have been caught flouting welfare laws, often in shocking and sickening ways. All too often, this cruelty is casually meted out to every animal that passes through their hands.
The Animal Aid charity has carried out covert investigations going back as far as 2009. Since then, the group has secreted cameras inside 10 randomly selected UK slaughterhouses and found serious animal welfare breaches in nine of them. The latest evidence from a non-stun Yorkshire slaughterhouse was released to the media just this morning. It showed that the layout of the slaughterhouse was deficient and, in the words of the group,
“was guaranteed to cause unnecessary suffering to animals”.
One wonders how that slaughterhouse was ever approved in the first place. The video from inside the abattoir shows casual, routine violence, with sheep being picked up by the ears, legs and fleeces and thrown on to the conveyor, or hurled head first into solid structures. It shows that the “surgically sharp knife” was often so blunt that the slaughterer had to hack over and over again at the throats of still-conscious animals. It also shows workers tormenting animals: waving knives in their faces; shouting at them; and in one case painting spectacles on the face of a sheep, so that they could laugh at the animal as she bled to death.
Jim Shannon (Strangford) (DUP)
I think every one of us was shocked when we saw the CCTV video and the pictures in the papers. I understand that in every abattoir there is an official veterinary officer who is available to monitor what happens inside the abattoir. They have to be of a certain qualified standard, but I understand that some of them are not. I suggest to the hon. Gentleman that perhaps the way forward with this issue is to ensure that those official veterinary officers have the qualifications to observe and monitor the abattoirs, to ensure that these practices do not happen.
Henry Smith
I am grateful to the hon. Gentleman for his intervention. The fact is that the vets who are on site in slaughterhouses are not everywhere at once, and too many incidents have been missed, as I will discuss. Proper training is essential, but having an all-seeing eye and independent monitoring would ensure the maximum quality of animal welfare conditions in our slaughterhouses.
The recording to which I was referring shows appalling violence. The Food Standards Agency has so far suspended the licences of three workers, and I understand it is also building cases for prosecutions. Terrible as those actions are, that slaughterhouse is not, unfortunately, an anomaly.
Lady Hermon (North Down) (Ind)
I speak in a dual capacity, as a farmer’s daughter and as the Member for North Down. I strongly support the hon. Gentleman’s call to make CCTV cameras compulsory in all slaughterhouses, and I hope that that would be extended to Northern Ireland. Can he enlighten the House as to the estimated cost of the installation of such cameras?
Henry Smith
I am grateful to the hon. Lady for her intervention. My brother is a farmer, and many farmers I have spoken to are deeply concerned that the welfare that they care about when the animals are on their farm is discarded in the final moments in the slaughterhouses—I received an e-mail about that just earlier today. I will come on to address the cost to slaughterhouses, but it would range from a few hundred pounds to a few thousand pounds. Given the scale of the industry, only a small amount would be needed to install CCTV across all slaughterhouses in the UK. I deliberately say the UK, because it is important that Northern Ireland, as well as Great Britain, is included.
Earlier recordings revealed animals being kicked, slapped, stamped on, picked up by fleeces and ears, and thrown into stunning pens. They recorded animals being improperly stunned and coming round again, or suffering painful electrocution instead of being stunned. Cameras have also captured animals being deliberately and illegally beaten and punched, and burned with cigarettes. Workers have been caught hitting pigs in the head with shackle hooks, and using the stunning tongs deliberately to cause pain by sending electric shocks through animals’ ears, noses, tails, legs and abdomens, and even, in one case, through an open mouth.
The key point I wish to convey tonight is that not one of the illegal acts filmed was detected by the Government-appointed on-site vets or the slaughterhouse operators, who have ultimate responsibility for animal welfare. The current regulatory system fails animals badly, and I believe it is time to rectify that. Workers do know the law and they know how to abide by it, yet investigations show that it is routinely flouted when they think no one is watching—in which case, someone needs to be watching. Independently monitored CCTV could help reduce the number of vicious attacks in the first instance by deterring them. Who would stub a cigarette out on the face of an animal if they knew the illegal act was being recorded?
Cameras could help prevent routine suffering by detecting institutionalised poor practice, such as the illegal stunning and slaughter methods used in at least four of the slaughterhouses videoed by Animal Aid. Any vet who saw these methods would have been able to step in and advise retraining for the staff involved. And, of course, those who do cause deliberate unnecessary suffering to animals are much more likely to be caught. The recordings, when properly monitored, provide evidence that will allow food business operators and the Food Standards Agency to take decisive action. Since Royal Society for the Prevention of Cruelty to Animals welfare standards introduced the requirement for installation of CCTV in abattoirs from 2011, all Freedom Food scheme-approved slaughterhouses have had to install effective CCTV systems and store recordings, and make them available to Freedom Food and RSPCA field staff.
Jim Shannon
The hon. Gentleman is being gracious in allowing my interventions. Perhaps he is coming on to this, but will someone be paid to monitor and observe the CCTV? Will there not be a cost factor in that, too?
Henry Smith
The hon. Gentleman raises an important point. The importance of CCTV is that what is recorded is stored for a period of time and then made available to independent inspectors. I know of a number of groups that would be willing to provide that service at no cost to the taxpayer because of their concern for animal welfare.
Let me return now to the RSPCA and the Freedom Food scheme. The two organisations have direct practical experience of seeing and assessing the issues associated with the operation of CCTV systems in a range of slaughterhouses. Based on first-hand experience, the use of CCTV in abattoirs is likely to bring many benefits to animals, inspectors and food business operators. Many of those benefits have already been realised in abattoirs that have installed such monitoring.
The presence of an effective CCTV system in abattoirs is also likely to improve confidence among consumers, enforcers, the food industry and the farming industry that poor practice is being avoided—or at least is more likely to be identified and properly dealt with.
One RSPCA farm livestock officer who monitors Freedom Food approved abattoirs, and who has many years of experience of viewing practices and assessing compliance with welfare provisions in slaughterhouses both before and after CCTV, said:
“In my opinion it has improved welfare considerably.”
The slaughter industry has not made a good name for itself. In recent years, the media have reported on: the deliberate adulteration of meat products with horsemeat; the scandalously high levels of Campylobacter in chicken; the theft of firearms from slaughterhouses; the use of a captive bolt gun to commit a murder; and a number of abattoir workers being killed or seriously harmed at work, sometimes through misuse of equipment, poor training or irresponsible behaviour. Add to that the repeated revelations of cruelty to animals and it is clear that there needs to be better monitoring.
The supermarkets have already taken decisive action. All the major chains—Tesco, Asda, Sainsbury’s, the Co-op, Morrisons, Marks and Spencer, Lidl, Aldi, Waitrose and Iceland, as well as wholesaler Booker—now insist that their slaughterhouse suppliers have CCTV installed. This so-called “voluntary” scheme has led to a significant increase in the number of slaughterhouses installing CCTV. The latest Food Standards Agency figures suggest that 19% of red meat slaughterhouses have CCTV, which accounts for around 48% of red meat volume, and 29% of white meat slaughterhouses, which accounts for 59% of poultry meat volume.
Although that is a positive step, a voluntary scheme has its obvious limitations. Not everyone will install cameras and, as was noted by an FSA board member, it is likely that those who resist installing CCTV are most in need of additional regulation and scrutiny.
There seem to be just three arguments put forward against implementing this much-needed legislation. The first is that CCTV cameras do not work because they were already in one of the slaughterhouses filmed by Animal Aid. My reply is that of course poorly sited cameras with no one monitoring the footage will not work. The answer is ensuring that cameras are in the right place, that recordings are kept for a significant period, and that an independent body, which is focused on the protection of animals, gets to select random or appropriate sections. There is no argument that anyone should view the recordings in their entirety. Clearly, that would be an impractical, onerous task.
The second argument is that veterinary surveys show the same level of compliance in slaughterhouses that have cameras as those that do not. However, we know from investigations that vets do not see the commonplace abuse that takes place in slaughterhouses, so how can they report with any degree of accuracy on levels of compliance? The answer is simply that they cannot.
That exact problem was highlighted again recently when the official number of recorded mis-stuns in slaughterhouses was made public. Vets in slaughterhouses record the cases in which the animals are not stunned properly and at the end of the year those figures are counted up. In 2009, those veterinary figures stated that there were just five mis-stuns of pigs across the whole country for the entire year, but in 2009 Animal Aid placed hidden cameras inside three slaughterhouses, one of which mis-stunned more than 99% of the pigs while another mis-stunned more than 10%. In 2010, the veterinary figures once again suggested that there were just five mis-stuns of pigs across the whole country for the entire year, whereas secret recordings measured 762 mis-stunned pigs in a single slaughterhouse over just three days. It is clear that vets do not see what is happening, which is why we need independently monitored CCTV.
Finally, we come to the cost. The cost of CCTV installation is not prohibitive—it is just a few hundred pounds for the smaller slaughterhouses and £2,000 to £3,000 for the larger ones. Supermarkets report no resistance to their request that slaughterhouse suppliers install cameras. Although those one-off costs are low, there are various funding options that could be explored. They include individual slaughterhouses funding their own cameras, the industry funding them and the Government making available loans or grants. Although money at the Department for Environment, Food and Rural Affairs is understandably limited, between 2011 and 2014 DEFRA gave more than £900,000 in funding to slaughterhouses through the rural development programme for England. That sum would sufficiently pay for CCTV installation in every slaughterhouse in England that does not have it. In any case, there could be phase-in times and derogations for the smallest slaughterhouses to help facilitate the change.
As for the cost of independent monitoring of the recording, there are options to be explored but we should remember that the taxpayer is already paying in the region of £30 million a year to regulate slaughterhouses, and that in terms of animal protection at least that money is clearly not working. It is much better to re-evaluate the system and use those millions to ensure that animal welfare laws are upheld.
In conclusion, CCTV is a practical, sensible and proportionate response to a serious, widespread problem. It will not stop the suffering inside slaughterhouses, but it will deter gross acts of violence that were all too commonly recorded, help vets advise and retrain, and help the FSA clamp down on lawbreaking by providing evidence for prosecutions, should they be necessary.
As its obvious benefits are becoming more widely known, support for making CCTV in slaughterhouses mandatory is growing. More than 170 right hon. and hon. Members have signalled their support for it, whereas a YouGov poll of British adults last year showed that 76% support mandatory CCTV for slaughterhouses with independent monitoring. I note that a petition to No. 10 in support of the measure has now attracted more than 80,000 signatures. I therefore believe that this will be an issue that the House will debate again in the very near future.
The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (George Eustice)
I congratulate my hon. Friend the Member for Crawley (Henry Smith) on securing this timely debate, given that we have had the recent publication of the Food Standards Agency’s latest survey on animal welfare in slaughterhouses. I am also aware of Animal Aid’s campaign for compulsory CCTV and the revelations in the media today about apparent incidents at the Bowood abattoir in Yorkshire. In addition, I can tell the House that today we have published a report on CCTV in slaughterhouses by the Farm Animal Welfare Committee, which is an expert advisory committee to the Government. I have placed a copy of the report in the Library. The committee has been considering the issue for much of the past year and I am grateful to it for its input.
Animal welfare is a matter on which DEFRA receives a huge amount of correspondence. It really matters to the British public and to the Government. From my personal perspective, although I am not a vegetarian, I was a farmer for nine years and it matters to me. When one rears cattle—when one looks after cattle, pigs and other animals—one wants to know that when they are sent off to market—to their end—they will be spared any unnecessary stress or suffering, and that they will be treated with respect. That matters to all good farmers, to the public and to good slaughtermen, too. I will return to the issue of CCTV and the findings of the FAWC report, but first I will deal with the Bowood incident, reported in the media today following the release of secret footage by Animal Aid.
I was first made aware of the Animal Aid video on 6 January and I asked immediately to see some of the footage that Animal Aid had made available to the FSA. Like many others who will have seen the footage, I found the films distressing and gave my full support to the immediate enforcement action that was being taken.
The FSA acted swiftly to suspend the licences of the four slaughtermen involved. It also launched an immediate investigation into the incidents, and that investigation is ongoing. One of the suspended members of staff was subsequently sacked by Bowood, while the remaining three are banned from handling live animals until the investigations have concluded. In addition, I can confirm that the FSA has required the immediate introduction to Bowood of an additional inspector to monitor operations there, and the cost of that additional inspector will be chargeable to the business. The additional officer will have full viewing access to all areas of the plant. Also, I recently asked our deputy chief veterinary officer to commence a piece of work with the FSA to review the way existing regulations are implemented and enforced, with a view to ensuring consistent understanding of what guidelines should be followed to ensure that slaughterhouses abide by the requirements of the Animal Welfare Act 2006.
The report by the FAWC concludes that there are many benefits to CCTV in slaughterhouses, but also sounds a note of caution, stating that CCTV is no panacea, and while it can be a useful tool to complement existing enforcement and management, it cannot replace other management procedures and inspection regimes. It is tempting to conclude that the footage released by Animal Aid proves a point: that perhaps things like this would not happen if CCTV were in place. However, as my hon. Friend acknowledged, the reality is that the Bowood abattoir where Animal Aid secretly recorded its footage already has CCTV. The presence of CCTV did not prevent those apparent incidents, and the Bowood case is not the first example of apparent welfare breaches, including deliberate abuses, found in slaughterhouses where CCTV is present. My conclusion is that CCTV can only ever be part of the answer to improving animal welfare and preventing abuses. It needs to be backed up with other monitoring methods.
Roger Williams (Brecon and Radnorshire) (LD)
I declare an interest as a livestock farmer, as well as my utter disgust on seeing the film of the Yorkshire slaughterhouse. I am a little concerned that many small slaughterhouses are already closing down, mainly because of the costs of regulation and supervision. Does the Minister agree that the introduction of CCTV should be proportionate, so that small slaughterhouses that have a good record on hygiene and animal welfare can be exempted, as the hon. Member for Crawley (Henry Smith) suggested?
George Eustice
I was going to discuss some of the options later. Earlier, the hon. Member for North Down (Lady Hermon) asked about costs. The FAWC has said that the costs can range from £3,000 to £10,000; that is the committee’s view, but other estimates are higher, at £25,000. Clearly, it depends on the size of the abattoir and the number of areas covered by CCTV, but we do not think the cost of the equipment is prohibitive. It is relatively modest but it is none the less a real cost and we must be careful not to harm smaller abattoirs, particularly those that have good track records on animal welfare.
As I said, the FAWC report states that there are benefits to CCTV. The committee concludes that it has a useful role in recording incidents, helping enforcers by enabling them to look at the footage to check what actually happened. It can also be used for evidence where welfare abuses are suspected. But the benefits of CCTV go wider than its role as a possible deterrent. For instance, it could allow observation of activities in small or confined spaces where it would otherwise be difficult for the official veterinarian to observe. The report also concludes that CCTV can provide more accurate ante-mortem inspection in the lairage areas. For example, it is apparent that sheep may mask lameness when a stockman or a vet is present but not under remote observation.
CCTV can also be a valuable training tool for operatives to encourage sensitive and sympathetic behaviour towards animals and to spot any bad practices which could result in incidents or near misses. The report concludes that it is necessary to get the balance right between CCTV being present as a deterrent and a “Big Brother is watching you” device, and using it in a positive way to help train operatives.
I want to say a little about the current situation and the uptake of CCTV. The FSA’s survey of compliance with animal welfare regulations in slaughterhouses in 2013, which was published last week, looked at the extent to which CCTV was already present on a voluntary basis in both red meat and white meat slaughterhouses. It is encouraging to note that the 2013 survey recorded that there has been an increase since 2011 in the use of CCTV, and that 43% of red meat and 55% of white meat slaughterhouses now have CCTV installed. By comparison, in 2010 just 7% had CCTV in the stunning and slaughter area and 8% had CCTV in other areas, so progress has been made.
Of course, these figures illustrate only part of the picture, as even those slaughterhouses that have CCTV installed do not necessarily have it in all areas. For example, red meat slaughterhouses tend to have slightly more CCTV in the lairage and unloading areas than in the stunning or bleeding areas. None the less, the trend towards increased installation and use of CCTV in slaughterhouses is welcome. Once we take into account the fact that the larger abattoirs tend to have CCTV and look at the throughput of those slaughterhouses, the results are even more positive. The proportion of animals slaughtered in premises using CCTV is approximately 83% of sheep, 90% of cattle, 92% of pigs and 98% of poultry. As my hon. Friend the Member for Crawley pointed out, the fact that 10 of the major supermarkets demand CCTV in slaughterhouses that supply them has, no doubt, been a factor, but I hope hon. Members agree that it is encouraging that much of the meat and poultry industry has reacted positively for calls over recent years for CCTV introduction.
On enforcement, business operators are primarily responsible for the animals in their care at slaughterhouses, whereas the FSA’s official veterinarians are responsible for monitoring the welfare of animals at slaughterhouses. The report by the Farm Animal Welfare Committee points out that since the responsibility ultimately rests with business operators, they have an interest in ensuring that they do their job effectively. CCTV can assist them in doing that. I agree with my hon. Friend on some of the advantages of CCTV and that it can be a powerful tool. I welcome the increased uptake in CCTV, although I recognise its limitations.
I shall touch briefly on the point about mis-stunning, which my hon. Friend raised. On the statistics concerning mis-stuns, the Government accepted last year that these were unlikely to cover 100% of incidents. Official veterinarians do not monitor all killing operations, and for poultry OVs can only ever record the number of incidents, rather than the number of animals affected. It is important to clarify what we understand by a mis-stun. Previously, only major and critical breaches where the mis-stun caused pain, suffering or distress were recorded, along with the corrective action taken.
Following questions asked in the House, I asked the FSA to review the way it monitors and reports mis-stuns, and it has now issued new instructions to official veterinarians which requires them to record minor breaches, such as where there may be a superficial concussion owing to an inaccurate position and a second stun is applied immediately afterwards. I hope that in future my hon. Friend’s concerns about the accuracy of data will be addressed.
In conclusion, the key question that the debate raises is whether making it mandatory for slaughterhouses to have CCTV installed will improve animal welfare. The last time the Government looked at the issue, which was in 2012, we concluded that mandatory CCTV was not the right way to go. However, I have always been clear that we keep the issue under review and that I have an open mind. I have just received the report from the Farm Animal Welfare Committee, which examines the arguments and evidence for the compulsory installation of CCTV in slaughterhouses. I want to consider its findings fully before reaching a final conclusion. As I have said, I will place a copy of the report in the Libraries of both Houses so that hon. Members can do the same. We have also uploaded the report to the gov.uk website.
We have had an interesting debate. My hon. Friend, who has pursued the issue tirelessly since being elected, raised some important points. I hope that I have been able to address some of his concerns today.
Question put and agreed to.
Petition
Negligence Claims
Westminster Hall
(9 years, 10 months ago)
Westminster HallRead Full debate Read Hansard Text
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Cavity Wall Insulation
(9 years, 10 months ago)
Westminster HallRead Full debate Read Hansard Text
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
Mr John Denham (Southampton, Itchen) (Lab)
I am pleased to open this debate under your chairmanship, Mr Sanders. I welcome the Minister to her place—I will be posing a number of questions to her at the end of my remarks.
I am able to bring this subject here for debate because of a remarkable woman, Claire Eades, and two others, Pauline Saunders and Dianna Goodwin. That trio of schoolteacher, artist and retired magistrate have shown that those whose cavity wall insulation goes wrong can find it near impossible to obtain swift and effective redress. Quite recently, they set up the Cavity Wall Insulation Victims Alliance, and I have drawn on far more cases from the association than I can report today. Other reported cases are included in the briefing pack for the debate compiled by the Library. I know that hon. Members of all parties will contribute their own constituency cases.
Claire Eades’s parents are constituents of mine. Their home in Southampton suffered badly from wrongly installed cavity wall insulation. Claire ultimately achieved a reasonable settlement after a determined campaign, but her parents are not the only ones affected. Their case exposes the problems with the supposedly independent insurance body, the Cavity Insulation Guarantee Agency, as well as bad industry practice and total inadequacies in the regulation provided by Government.
The market in cavity wall insulation is worth £700 million to £800 million a year. It has been boosted by Government policy, with some direct Government funding; however, most CWI has been funded by energy companies, which have been required to invest in energy conservation measures through a range of schemes, such as the carbon emissions reduction target, the community energy saving programme and the energy companies obligation. All the schemes differ in some respects but include insulation paid for by energy companies meeting Government obligations. Energy companies that fail to do so can face fines.
Many householders who responded to cold calls, e-mails and adverts and had cavity wall insulation installed had no idea that an energy company was funding that installation. Advertising typically refers to a 25-year guarantee and names CIGA. Doorstep visits and telephone calls typically describe the schemes, wrongly, as Government-backed or Government-funded. I have transcripts of a couple of phone conversations with such salesmen, one of whom, when asked who funded the cavity wall insulation, said:
“Erm, I think it’s the government, and also your British Gas, your Southern Electric, and the other companies. Sorry, it’s only my first week but obviously that’s why they’ve already paid for it and…it’s free on behalf of the government.”
In another case, this time when discussing guarantees, the salesman said:
“Yeah, there’s only a couple of companies which government approves, they’ll give you a 25 year guarantee with the government.”
The transcript goes on:
“‘Sorry, if I had it done would I get a government guarantee?’
‘For 25 years.’
‘What, the government guarantees it?’
‘Yeah, because the government fund it. They don’t fund it, it’s from the tax they’ve taken from you, so they fund it in that way.’”
That is fairly typical of what goes on in the industry.
Even official bodies get it wrong. The North East Lincolnshire council website advises:
“The Cavity Insulation Guarantee Agency…was set up by the government to provide householders with an independent, uniform and dependable guarantee. This is a 25-year guarantee that is independent of the installer who insulates your property.”
But CIGA was not set up by the Government, nor is it independent of the installers. When things go wrong, the Government are the first to deny any responsibility or involvement. Government policy is driving much of the market, but the Government are not taking the measures needed to ensure high standards of installation or redress.
The Government have had plenty of warnings. The Office of Fair Trading reported in 2012 that failure to install properly would undermine Department of Energy and Climate Change targets for energy reduction. It recommended that DECC should ensure that there was a single body ensuring effective independent monitoring of installers and installation quality. All there seems to be is a licence; Dianna Goodwin of the CWIVA bought one online for £75.
The Minister is advised by the Green Deal Consumer Protection Forum. At its meeting on 26 June 2014, Ofgem reported:
“Ofgem has noted that there are suspected cases of fraud within the ECO scheme, for example around the installations for hard-to-treat cavity walls. Ofgem was informed of anecdotal evidence of systematic abuse of the technical rules, and investigated. It found that a number of installations were done improperly…Ofgem reported that one of the main difficulties it has is that it cannot engage with the supply chain”—
that is, the installers—
“as its agreement is with energy suppliers.”
At the same meeting the Energy Saving Advice Service reported that it receives about 30 complaints about ECO per week. There have been different schemes, but those elements—poor installation, abuse of the rules, and the inability of Ofgem to act—appear to run through all of them.
Following a cold call, a Mark Group survey of the Eades property took place on 10 June 2010. CWI can go wrong—badly installed or installed in an inappropriate property, it can cause damp penetration and condensation. In 2011 Which? asked eight companies to assess a clearly unsuitable house for CWI. All eight surveys recommended installing CWI. Funnily enough, four were carried out by that same company, the Mark Group, and three by the same person. All four surveys provided different prices even though they recommended the same work and materials.
The Eades’ property is less than 1 mile from the sea and according to an independent survey conducted last year is
“exposed to severe wind driven rain”.
Cavity wall insulation was installed in the property on 10 November 2010. By 4 February 2011, the house had a strong musty smell and significant condensation, and black mould was beginning to form. It is common for problems with CWI to appear more than a year after installation, yet the only routine independent inspection of properties takes place a few weeks after installation. It is required by Ofgem, but it is not to check whether there are damp problems; it looks only at whether energy reduction targets are being met. I cannot know—nor can the Minister—whether the problems I am raising are isolated or the tip of an iceberg.
On 3 February 2012, the Eades sent a letter by recorded delivery to the Mark Group reporting severe condensation. No response was received to the complaint. That lack of response appears to be standard across the industry. In December 2013, two years after the original installation, there was significant water ingress and damp patches were appearing along the length of the south-west-facing wall upstairs and downstairs and from top to bottom of the wall.
A quick look at the part of the Review Centre website relating to the Mark Group shows pages of complaints. For example:
“The installation team from Mark group in their wisdom filled all the air bricks in the property with silicone sealant…causing huge problems with damp. I have complained but had no response.”
Another reads,
“from my experience either I am the most unlucky house-holder in the country, if this is a one-off event, or the whole cavity idea is a big sham which should be investigated by someone other than the industry itself.”
A further complaint reads:
“Do not use Mark group. They filled our walls with non-compliant CWI, as open to the wind driven rain, our properties have been ruined...CIGA’s guarantee up to now is worthless”.
A further complaint says:
“It is now nearly 6 months since they damaged my home and I am no nearer to resolving the issue. They seem to be using delaying tactics in the hope that I will give up.”
And so it goes on, for page after page.
I do not know, however, whether the Mark Group is worse than any other company. It is still approved to do this work. My own encounter with the company was not good, as it made a fatuous attempt to threaten legal action after I retweeted a customer complaint—something I have never come across in 22 years as a Member of Parliament. [Interruption.]
Mr Adrian Sanders (in the Chair)
Order. As much as people in the public gallery might feel the need to applaud, that is not the way we do things. Thank you.
Mr Denham
I have some satisfaction in saying that it was at that moment that I decided that I should try to secure a parliamentary debate on the issue.
The Eades eventually contacted the Mark Group via its website. On 9 January 2014, Mr Lillywhite of the Mark Group inspected the property and offered to extract the cavity wall insulation for £2,000. Such double paydays for companies that install insulation wrongly and then charge to take it out again seem to be endemic in the industry. On 21 January, Claire Eades put a review on the Review Centre website, as the report of the inspection in January had still not been received. After further chasing, the Mark Group report was sent by Nathan Dunham. The report stated that the CWI was correctly installed and that the property was at fault. The response that nothing is wrong with the cavity wall insulation and that the damp is caused by something else is standard across the industry. Sometimes the property is blamed, and sometimes the occupants’ lifestyle is blamed, even though the same people have been living in these properties for years without suffering damp problems. It is simply a disreputable tactic. Many of those who take up CWI are older. They live in properties they own, and fuel bills are a major part of their expenditure. Perhaps the industry thinks they are less likely to complain.
On 31 January 2014, Claire Eades gave Mr Dunham of Mark Group a week to supply a date for a CIGA visit. CIGA was established in 1995. Ministers refer to it as independent; indeed, a letter from the Minister in December said:
“CIGA is an independent body”
and
“an organisation that will clearly be up to resolving issues relating to cavity wall insulation”.
I must ask the Minister what advice she was acting on when she signed that letter.
How independent is CIGA? On 3 November 2014, the directors were: Jeremy Robson, a director of the British Board of Agrément, the National Insulation Association and InstaGroup; John Sinfield, managing director of Knauf, which makes insulation materials; John Card, a director of Domestic and General Insulation Ltd; Brendan McCrea, a director of Abbey Insulation and Warmfill; Walter French, a director of the National Insulation Association; and Ian Tebb, a director of Polypearl Ltd and Tebway Ltd. Michael Cottingham was a director of CIGA between 2008 and 2009 and the managing director of Mark Group from 1991 to 2009. How can an organisation led almost entirely by directors of insulation companies be called independent?
I will return to the case of Pauline Saunders, but I want to read an e-mail she sent about a south Wales neighbour:
“I have just called on a very vulnerable 82 year old widow who unfortunately is in the position that her cavity wall installer has gone out of business and CIGA are not responding to any correspondence regarding this lady’s situation. I have just visited this lady and found her up to her knees in shredded wall paper”—
it was peeling off because of the damp—
“that she is scraping off the wall herself in an effort to save money”.
Even if vulnerable people complain, therefore, they are not guaranteed a reply.
After chasing, a CIGA inspection was carried out on the Eades’s property by a Chris Cuss on 13 February. On 20 February, the Eades wrote to CIGA to complain of a lack of interest on the part of the inspector. On 25 February, a short summary was sent to the Eades stating that the property was at fault, with no mention of faulty installation. The family therefore asked Mark Group for a copy of the original inspection report, which, had it been done properly, would have shown any failures in the property.
On 26 February, Mr and Mrs Eades wrote to John Campbell at CIGA. In a separate case, Dianna Goodwin of Milford on Sea had been copied into an internal e-mail from Mr Campbell, which referred to her, saying:
“She has far too much time on her hands and nothing better to do.”
In that case too, CIGA claimed there was no evidence that the CWI had
“caused or contributed to any issues with water penetration”.
That e-mail was sent from an organisation that, in its briefing to Members of Parliament for today’s debate, says:
“If something does go wrong, CIGA is at hand to put things right for consumers. It exists to protect consumers; they are our number one priority”.
The full CIGA report was never sent to Mr and Mrs Eades, but Claire Eades asked Mark Group for its report and the full CIGA report. The full CIGA report was then sent, and it said:
“the installation of CWI has NOT been completed in compliance with system designer and BBA specifications, the drilling pattern is non-compliant omitting an area of the original external wall within the rear extension”.
The full report would never have been made available to Mr and Mrs Eades had it not been for their daughter’s persistence.
CIGA colludes with installers to suppress evidence of failure and mis-installation. In the Eades case, it concluded, on the basis of no evidence, that CWI had exacerbated a concern regarding damp. It failed to acknowledge that the original Mark Group survey did not identify any pre-existing dampness.
CIGA claims there are historical problems in homes that have always been dry. Mrs Goodwin of Portsmouth was told her damp was caused by property defects and “lifestyle condensation”, even though her home had never previously suffered from damp. Chris Stillwell of Weymouth says:
“I have been left with damp and damaged walls....my flat is uninhabitable and has been ruined…CIGA who guarantee CWI keep trying to fob us off, even though their report states that the insulation used is now non-compliant”.
On 17 March last year, Lloyds, the household insurer for the Eades property, said the damp and water ingress were due to faulty CWI. However, the Eades still faced the challenge of getting work done, because having the CWI installed had invalidated their household insurance policy. They raised their plight with DECC, which said, “Go to Ofgem.” It also said:
“under the 25 year guarantee there should be no cost to the householder”.
DECC must be aware that CIGA conspires to keep details of inspection reports from householders and produces reports that are totally inadequate.
The Eades took their plight to Ofgem. Ofgem took a month to reply and referred them to Citizens Advice. They raised their plight with trading standards, which said, “Go to the citizens advice bureau.” They went to the CAB, which said it could not help and suggested the couple go to trading standards. They finally went back to DECC, asking who was responsible. The DECC reply was very clear: whoever it was, it certainly was not going to be DECC. DECC said:
“The contractual arrangements between energy supplier and third parties are not within our remit”.
For the Eades, this was the first time the involvement of an energy supplier had been mentioned.
A couple of weeks letter, DECC offered further advice: Mr and Mrs Eades—an elderly couple—should get a solicitor. However, on 23 May, there was a breakthrough. Ofgem had managed to establish that E.ON had funded the installation. Claire Eades told me that Dani Hickman of E.ON corresponded directly and appropriately with Mr and Mrs Eades. The involvement of the energy supplier was critical.
The Cavity Wall Insulation Victims Alliance has been in contact with more than 40 victims, but the Eades case is the only one in which the link with the energy company has been established. Ofgem does not hold address-level information consistently and, under CERT and CESP, there was no obligation for suppliers and installers to submit it. Despite that, the Minister of State wrote to me on 9 July, saying:
“Should it be the case that this work was undertaken under CERT, then Ms Eades or her parents may wish to contact the relevant energy supplier if they are unable to resolve the matter with the installer”.
In this case, Ofgem did trace the energy supplier for the Eades, but whoever drafted that letter for the Minister of State must have been aware that it would have been quite impossible in most cases under CERT to trace the energy supplier.
E.ON’s involvement led to an inspection by Knauf. The inspection recommended that the insulation be taken out of the south-west-facing wall due to voids. The internal walls in the extension should also have been drilled out for installation, and there were other failings. The Knauf report was never sent to Mr and Mrs Eades, and it was not intended for them. It was passed to them only by E.ON, which, acting on their behalf, demanded it from the Mark Group.
On 20 June, E.ON commissioned Green Deal Resourcing to carry out thermal imaging, which showed voids. The property is exposed to severe wind-driven rain. The insulation is facilitating the transfer of moisture across the cavity.
Having got that further independent report, the Eades complained to the British Board of Agrément. The BBA is supposed to accredit installers and materials, but it shares directors with CIGA. This is a very cosy network. The United Kingdom Accreditation Service, which is responsible for accrediting the BBA, confirms that householders have no right to see BBA reports on their properties.
On 21 July, the BBA inspected the property. Its report was never sent to Mr and Mrs Eades; it was sent to the Mark Group. It started, “Hi Nathan.” It continued:
“The system hasn’t been installed in compliance with the BBA issued certificate and should be extracted”.
Again, the Eades had no right to see that report. They got it only because E.ON was involved and passed it on to them.
To return to the case of Pauline Saunders of Newport, she finally received £1,750, and the Mark Group removed the fill. The trigger was a BBA report on the property that was sent to her in error. As a result, she was able to establish that it said:
“the property was and is unsuitable for cavity wall insulation and should not have been insulated”.
Without that report, which was intended only for the eyes of the installers or CIGA, she would not have received a payout.
In the end, the Mark Group and its loss adjuster, while still denying responsibility, paid the Eades about £11,000. Let us remember that the Mark Group originally wanted to charge £2,000 to remove the insulation from the property, having already been paid by E.ON for putting it in. How many people will there be who have not managed to pursue things that far? One cause of offence is the fact that even when settlements are achieved, installers still routinely deny responsibility and describe any action as a good will payment. Mr and Mrs Eades had their work done by a company that only does removal. On the occasions when CIGA will pay for extraction, its chosen extraction companies are Dyson Energy Services and InstaGroup, both of which share directors with it, so even when CIGA is finally forced to act, it seems that companies owned by its directors are the ones paid to do the work.
In a note sent to Members of Parliament, CIGA says:
“If something does go wrong, CIGA is at hand to put things right for consumers”.
I can give no credence to that claim. It says:
“If there is a problem with the workmanship or materials of an installation, we will ensure the installer put things right.”
As I have shown, CIGA takes active steps to avoid installers having to put things right. It says that, with regard to the 11,675 concerns reported, it has worked with installers to resolve 80% of cases; in 20% of them it covered the cost of work to the value of more than £2 million. Well, 80% plus 20% is 100%: that is all the cases dealt with. So how come so many people say they cannot get their problems resolved? There is something dodgy.
The obvious question is whether all those householders would agree that the resolution has been satisfactory, or whether they have just given up, accepted whatever they can take, or paid to put things right themselves. Who knows? There is no independent oversight of CIGA. CIGA is judge and jury in its own case, and it is run by the people who cause the problem. It says in its briefing to MPs that it will appoint a consumer champion. It is a bit late in the day, and it is hard to give credence to that. I am pleased that since today’s debate was announced, some of those involved in cases taken up by the CWIVA have had better offers. However, we cannot allow that last-minute action to let CIGA off the hook.
I have several requests for the Minister. I would like a full review of how the industry and CIGA operate. I want her to make a commitment to establishing genuinely independent oversight of the compensation arrangements. I ask her to change the regulatory regime so that the link between each energy company and each property is transparent and registered. Also, crucially, I would like every effort to be made to find out what additional historical information can be established. We must not just rectify problems for the future; we must deal with historical cases. I want the Minister to establish an independent assessment of properties at least one or two years after installation. That is the only way we will be able to understand the true scale of dampness caused by CWI. I also want her to introduce effective regulation of initial sales.
I have no doubt that there is fear in DECC that acknowledging the problems would discredit a key energy conservation policy, but the real danger to the credibility of the energy conservation programme lies in hushing the matter up. Many victims now question the whole idea of cavity wall insulation. Jeff Howell, the respected building correspondent of The Daily Telegraph, believes that all retrofit CWI is likely to cause problems. Is that true? I certainly hope not, and many organisations take a different view, but unless the Minister acts now, those doubts can only grow. We should not allow that to happen. We need an honest appraisal of the technology—where it works and where it does not—and we need effective redress for the victims.
George Hollingbery (Meon Valley) (Con)
It is a pleasure to serve under your chairmanship this morning, Mr Sanders. I am grateful to the right hon. Member for Southampton, Itchen (Mr Denham), for securing this important debate. The tale I have to tell today is not quite as dramatic as the one he told. Today’s debate of course follows on from a similar one obtained by the hon. Member for Arfon (Hywel Williams) in October.
According to Department of Energy and Climate Change estimates, there are about 690,000 remaining “easy to treat” cavity walls in Britain, not including those in exposed locations, or with other issues such as narrow cavities and wall faults. If those were all insulated, the energy bill saving would be about £100 million a year, and the carbon dioxide saving would be about 450,000 tonnes a year. That would be the same CO2 saving as taking about 180,000 cars off the road. We should be clear, therefore, that cavity wall insulation is, on the whole, a good thing, when it is done at the right time, in the right place, in the right properties, by the right people.
Encouragingly, DECC statistics indicate that since 2009 the number of CWI installations has hugely increased across the UK. In 2012-13, in East Hampshire alone, there were 4,986 cavity wall installations, which is welcome—as long, of course, as they were done properly. However, as we have heard this morning and no doubt will again, there are times and places where the treatment is not suitable. For homes in an unsheltered position or exposed to severe wind-driven rain, or whose external walls are poorly built or maintained—with, for example, cracks in the brickwork or rendering—cavity wall insulation can clearly be a liability, as it may attract severe damp.
It is in just such a location that a constituent of mine in Meon Valley is currently experiencing terrible damp problems in his home, subsequent to the installation of cavity wall insulation. In the past several years dampness has begun to occur inside his south-facing walls, which, as he lives on top of a hill, are frequently exposed to driving rain. He tried several remedial measures without contacting the insulation company, none of which, unfortunately, solved the problem, and he was forced to conclude a year or so ago that his cavity wall insulation, installed in 2006, was the likely culprit. He brought the matter to the installer’s attention late last year. Since then, like, I suspect, many people attending the debate, he has been in dispute with the installer, and has requested the removal of the insulation.
This is not a fairy tale, but I am delighted to report that last week, after the debate and my intention to take part was announced, the Cavity Insulation Guarantee Agency, with which the installer has an agreement to provide a 25-year guarantee, has, after a further inspection of the property, recommended two options to resolve the problem. Hip, hip hooray! What a marvellous thing that is. One option is extraction in the affected area of wall, with the removal of all insulation to minimise the risk of further problems. Alternatively, the work could be redone with a decent damp seal membrane and/or a waterproofer called Haloseal. That is a magical thing, and I am delighted. I have also been informed that CIGA will reimburse my constituent for considerable costs incurred in remedying damp damage and for machinery that he had to bring into the house to extract water from the atmosphere.
That is all welcome and I am grateful that CIGA has reacted so positively to the case, but, despite the assurances, my constituent has very little trust in the industry. The fact is that the insulation should never have been installed as it was in the first place. Obviously, despite fairly well defined circumstances in which cavity wall insulation is clearly not appropriate, it is nevertheless routinely still being installed. According to a DECC review in 2012, there are between 215,000 and 245,000 cavity-walled houses in the UK in an exposed location, which could make them inappropriate for cavity wall insulation. That represents 1% to 1.5% of cavity-walled houses in the UK, so it is by no means an insignificant problem. I understand that my constituency is described as a category 3 area, which means that it has “severe” exposure to driving rain, and that therefore cavity wall insulation may be unsuitable for some properties. That sounds like almost everywhere in the UK to me.
Surely it should not be too difficult for installers to get things right. The CIGA website says that registered installers are required to carry out a thorough pre-installation inspection of the property, so problems should really be ironed out at that stage. It seems that, as most eloquently described by the right hon. Member for Southampton, Itchen, there is a need for either much more policing of the scheme or much more rigorous training.
Hywel Williams (Arfon) (PC)
It is a pleasure to speak today under your chairmanship, Mr Sanders. I congratulate the right hon. Member for Southampton, Itchen (Mr Denham) on securing the debate, which follows on from my previous half-hour debate. I am glad that other hon. Members are taking an interest in the issue. This has been a matter of concern to my constituents for quite some time. I have come across many cases that I will refer to, although I will not go into in as much detail as the right hon. Gentleman did. In such cases, cavity wall insulation has been installed when it obviously should not have been owing to heavy rainfall and the prevailing wind in west Wales.
In fact, my constituency is a category 4 area. The hon. Member for Meon Valley (George Hollingbery) referred to his area as being in category 3, but much of west Wales is category 4. The map is quite startling: west Wales is coloured deepest blue and that is not a reference to its political leanings. Obviously there are problems there.
As well as having heavy rainfall and being in a category 4 area, we also have many buildings with exterior walls in poor condition, including many older buildings and former council houses that have cracked rendering and, in some cases, rendering that has fallen off. In the case of one former council house—I think it is located at about 1,200 feet, facing the prevailing wind—the brickwork can be seen because large chunks of the rendering have fallen off, but cavity wall insulation was put in. Pebbledash is the common form of rendering in my area. It is effective owing to the level of rainfall, but, as we know, it does crack and I am concerned that, too often, that was not properly taken into account.
My concerns include the assessment of suitability for cavity wall insulation and whether it should be installed at all in wet and windy Wales. I have also looked at the CIGA paper provided for the debate, which has an interesting paragraph:
“As part of the suite of technical guidance published by CIGA, there are strict criteria for assessing the suitability of a particular home for cavity wall insulation. Each home must be fully assessed by a BBA registered assessor before any work takes place, and if cavity wall insulation isn’t the right way forward then the surveyor will tell you.”
That is for a house. I assume that the British Board of Agrément-registered assessors may also look at maps. Anyone looking at the map of my area and large parts of Wales will see, as I said, that it is coloured deepest blue, so they should ask whether cavity wall insulation should be installed at all in any house in the area.
I am also concerned about the standard of workmanship, which I will refer to later on. People have had problems because while I am sure that, if properly installed, cavity wall insulation is very effective indeed, it must be properly installed. I am also concerned about quality assurance, and the arrangements for remedial work and the industry guarantee scheme.
I am also concerned that, in particular, the people who had cavity wall insulation installed believed that that was a desirable, appropriate and trouble-free course of action. They were reassured because, so they thought, it was a Government-backed scheme. How could it be wrong? The right hon. Member for Southampton, Itchen referred to that earlier. I know that the Government are not directly responsible, but that is the perception, so it is both the Government and the enterprise of installation that face damage to their reputation.
I referred to my debate in Westminster Hall on 29 October when I discussed these matters. I do not intend to rerun that speech, but some points bear restating. I talked about assessments and referred to the Office of Fair Trading’s report, which states:
“Consumer magazine Which?...invited eight companies to assess”—
we know what the outcome was. I am glad that there has been other media interest from both broadcast and print journalists.
I am concerned about workmanship. Apart from cases where CWI has led directly to water penetration, I have also been told of those where it has been installed badly, with areas missing, which has led to cold spots, condensation and subsequent fungal growth. Even when it is proper to install it in a house, there can be problems.
On remedial work, some installers have accepted liability. I have had good relations with one energy company, British Gas, which has taken an interest and acted in certain cases. In some cases installers have accepted liability and returned to redo the work, but the householders are still not satisfied. There is a case that would be laughable if it were not so sad. An elderly lady called me to come to see her former council house. She had had remedial work done on her kitchen wall, but that had not been successful and the damp was back above the window. The case was straightforward, but what stood out for me was that, as I approached the house, I could see the remedial handiwork. The pebbledash rendering had been badly patched, so areas of about 1.5 square feet had no pebbles at all—that could be seen from across the road. The plasterer had achieved something like the appearance of pebbledash from afar by making indentations with his fingers, such was the quality of the remedial work.
In terms of quality assurance, the OFT report also said that
“if poor installation causes problems with damp, these may not become evident until a year or more after installation.”
That is pertinent, given what the right hon. Gentleman said. We need inspections much later on, when problems may have developed. The report continues:
“Monitoring, which is typically done in the weeks following installation, cannot identify these longer-term problems…In relation to regulatory monitoring, Ofgem requires the energy suppliers to inspect 5% of installations and provide a summary of these inspections”.
In the previous debate, I asked whether 5% was sufficient—that is only one in 20. Clearly the review system is not working.
I have come across so many cases in one small town, Caernarfon. I told a few people that I was holding a meeting about this matter in a week’s time and, essentially through word of mouth, about 30 people turned up. It strikes me that the problems are more widespread than CIGA concedes. I think it says such problems affect 2% of the 6 million installations, which must be about 12,000 cases. I am sure that there are more than that.
The industry guarantee scheme has worked in some cases, but other constituents think that it operates at such a high bar that proper redress is prevented in legitimate cases. Both the right hon. Member for Southampton, Itchen and the hon. Member for Meon Valley made the important point that some of the people who have been afflicted with these problems are elderly or infirm, so they will not be chasing after fancy lawyers because they cannot afford that. They are also not familiar with negotiating their way through officialese. They are fundamentally dissatisfied with the process, but they see no form of redress available to them.
I have a Welsh-national point. CIGA serves my intensely Welsh-speaking constituency and other such constituencies throughout Wales, but, disappointingly, there is not a word of Welsh on its website or in its literature. Other organisations, including commercial organisations, use Welsh as a matter of course and good practice to reach out to customers, rather than not using it and per se shutting them out.
As I said in the previous debate, the name of the local campaign in Caernarfon is “Waliau Du”, which means “Black Walls”, because unfortunately that is what happens: people’s walls turn black. Constituents have complained that the growth of mould has led to breathing difficulties, illness and the worsening of children’s asthma. People also suffer long-term worry about what will happen to their homes and the possible costs of repair. They might not be able to afford such repairs or to clamber into attics to see what is happening and such long-term worry has an effect on physical health.
My constituents subscribed to what they thought—rightly or wrongly—was a straightforward Government scheme. As we have already heard, some were told it was that by installers while others assumed that, as the Government were funding the installation—or so they thought—the system was safe and effective and the installers were operating to an appropriate standard of practice.
The OFT’s 2012 report noted that some people assumed that the installers’ practice was properly regulated and inspected and that appropriate quality assurance measures were in place. Those people feel let down. I believe that somebody—albeit an ill-defined somebody—should take responsibility, and that is what they feel.
My final point supports the points that were made by the right hon. Member for Southampton, Itchen—I support the questions he asked and the points that he raised. I believe that the matter warrants not only short-term remedial action for the people who are suffering, but a further comprehensive review, focusing on the problems that have become apparent over the years and that have been addressed this morning. I think we need to look at this across the piece. It should not be up to individual householders, who would find it very difficult or impossible to take their cases forward. We need a comprehensive review, because at the very least, there is reputational damage as far as the whole idea of cavity wall insulation is concerned, and for energy conservation in general, which is something that we all support, there is also the danger of reputational damage—let alone the damage to the reputation of this and previous Governments. That review should be instituted as soon as possible.
Alistair Burt (North East Bedfordshire) (Con)
It is a pleasure to serve under your chairmanship, Mr Sanders. I begin by thanking the right hon. Member for Southampton, Itchen (Mr Denham) for raising the matter in the way in which he has, and I agree with his assessment of the situation and his request for action. I also thank my hon. Friend the Member for Meon Valley (George Hollingbery) and the hon. Member for Arfon (Hywel Williams) for their contributions, which seem to chime with the experiences of my constituents. I will set those out for the House and the Minister, along with my own concerns that, as other colleagues have mentioned, there may be more to this than meets the eye. That is the most worrying thing about it. Here is something that is designed to assist people, keep them warm and protect their houses, but it is being handled in a manner that undermines all the principles behind it and is leaving people victimised and feeling that they have had no benefit whatever.
My constituents, Mr and Mrs Haley, brought their case to me. I will be as brief as I can, but it is important to put some of these matters on record, because they fill out what has been said. In my view, they also add significantly to the demand to look into the industry, because if so many cases are cropping up that have common elements, there is a problem.
My constituents had their cavity wall insulation, if it can be termed that, installed in October 2008. The property had been inspected by Eaga Home Services—now Carillion Energy Services—which unremarkably came to the conclusion that cavity wall insulation would suit and benefit the house, and the work was done. On 19 November 2008, a guarantee was issued to say that the work had been carried out satisfactorily. However, the workmen were only at the property for 50 minutes—they said that they could not get down the side of Mr and Mrs Haley’s house because of the dining room extension.
In January 2013, after problems with mould and everything else, my constituents contacted CIGA to say that they were concerned about the amount of mould growth in their house. There had been no problem for the 25 years in which my constituents had lived at their property, but since the cavity wall insulation had been carried out, mould had been growing on the walls and ceilings and there was condensation in the sealed unit double glazing.
A letter came from Carillion to say that it would investigate and resolve the matter. My constituents tell me that in March 2013, the service delivery manager attended
“our property and made a cursory inspection. It was obvious at the time that he was not listening to anything we said to him. He said he didn’t know what was causing the mould growth but it wasn’t due to the cavity wall insulation and there had actually been very little such insulation carried out in our house. This was surprising to us as we were not aware so little work had been done.”
On 19 April, there was a letter from Carillion denying any responsibility.
I have a very thick file of papers here, and the exchange that I have just detailed is the first six to eight pages of it. The rest of it—I am sorry that listeners on radio cannot benefit from seeing it—relates to the two years following in which the matter has not yet been resolved. It is a story of evasion and an inability to act, and of letters going unanswered and e-mails not being cared about. However, all in all, it is about what appears to be a relationship between those providing the service and those supposed to be providing the guarantee to ensure that, actually, nothing gets done. All our experience as MPs tells us that people fight for so long, but then it gets too much and they give up. We have all seen evidence of agencies supposedly acting for the public, and indeed providers themselves, simply making it impossible for people to go on. People reach a point where they have had enough, and if it were not for individuals such as my constituents and others who have been mentioned today, I suspect that the problem would remain buried. The concern that the Minister and the Department should have is: how many more? How many more people have not been able to go through and stick with their case in order to see it resolved?
Let me quote one or two important things. When CIGA first responded to the concerns in January 2013, straight up, it gave the assurance:
“As the holder of a CIGA Guarantee, you have the assurance that any defects relating to materials or workmanship will be resolved in accordance with the terms of the Guarantee”—
not worth the photocopied paper it is written on. Carillion’s response, which I mentioned, read as follows:
“Following the issues which you have raised regarding the condensation at your home, we arranged for the service delivery manager…to attend and assess the concerns you have. The service delivery manager has confirmed that the issues which you are experiencing are not as a result of the cavity wall insulation work carried out at your home. In his opinion”—
the opinion of those who put in the cavity wall insulation—
the cause of the condensation is due to the UPVC windows, as there is condensation in between the panes of glass, which is a sign that the seals have gone.”
Patronisingly, the letter went on to say:
“Condensation is caused when warm air meets cold surfaces; it is most likely to appear on surfaces such as windows, colder parts of walls, around door and window openings, at junctions of floors and ceilings with outside walls.”
Well, there we are then.
Hywel Williams
Does it not add insult to injury for people, when they have installed cavity wall insulation and double glazing, and they are heating their homes expensively, to be told by installers and others that they should open windows to get rid of condensation? It is an appalling response.
Alistair Burt
I have been a Member of Parliament for some 28 years, and in a previous constituency, there was a lot of condensation in some parts of the town. It can be a difficult issue, but it is the easiest thing in the world to avoid responsibility for. Whatever is going on in the house is said to be the fault of the householder, and it is difficult to prove otherwise.
If I may, I will finish quoting the letter from Carillion:
“I understand that this may not be the outcome that you would have hoped for. I would like to thank you for giving us the opportunity to investigate the issues you have raised.”
I wonder how many people have received a similar letter and thought, “Well, there we are. They know what they are talking about. It must be us; it must be something else.”
However, with the not unreasonable experience of over 25 years living in their house, my constituents were not prepared to accept that, and they responded as follows:
“We do not accept this decision. We have lived in this house for 28 years and have had the windows replaced. There were no problems with mould at any time. Then we had the cavity wall insulation done. The bedrooms, kitchen and living room then started to have mould growth around the windows and on the ceilings. Condensation on the windows became a real problem. When we first contacted the company about the cavity wall they sent out an inspector and he confirmed that there would be no problem to have the insulation carried out. However, when the workmen came to do the job they started muttering about being unable to do part of the house due to the fact that we had an extension. We got the impression that some parts of the house were not insulated. We are in the situation now where the whole house needs decorating but we can’t do anything because of the unsightly growth on the walls. If we had been told at the time that as a result of cavity wall insulation we would experience mould growth and condensation, we would not have gone ahead. Now Carillion seem to think they can just say it is not their problem. We consider it is. If there was a problem in installing the cavity wall we should have been fully informed before work started.”
That is the first eight to 10 pages of my file, which contains some 100 or 150 pages that detail my constituents’ attempts to deal with the problem. To cut a long story short, CIGA has recognised, after an independent inspection of the property, which was very difficult to arrange, that the cavity wall insulation was indeed installed in a faulty manner. CIGA continues to wriggle away from any serious responsibility, however, and it has made half-hearted efforts to get the matter dealt with.
I am not simply concerned about the way in which the case has been handled, although that is pretty bad. A detailed summary of what has been done is full of attempts to contact CIGA, attempts to ensure that people take responsibility and failure to deal with things. Some 16 months after it was notified of the initial complaint, for example, Carillion came back and asked for details of the problem. We see people at the bottom end of the chain being given the usual run-around by those who have power and responsibility.
After some further work on the matter, I came across a freedom of information request made by Ms Dianna Goodwin, from which I will quote briefly. I thought it was a very good piece of work that demonstrated, as the right hon. Member for Southampton, Itchen has said, the close relationship between the guarantee agency and the industry. Without repeating everything that was said about the directors and so on, I will read Ms Goodwin’s conclusion:
“With assets in excess of 16 million pounds, CIGA certainly does have the resources to meet claims under their Guarantee—yet have a strong track record for blatantly ignoring and intransigently resisting claimants. The government set the parameters for this industry and the abuse of the system is just allowed to roll on year after year, unchecked. It is nothing short of a national scandal that this private and patently non-independent company is allowed to function at all, and high time the government stepped in to disband them. Proper and solid arrangements should be made for their Guarantees to be underwritten; also for an obligatory ombudsman service made available for all. What action will the government take please?”
I am pleased to add my constituents’ concerns to those raised by other hon. Members.
Mr Denham
I am grateful for the right hon. Gentleman’s remarks and for those of the hon. Member for Arfon (Hywel Williams), who is the pioneer when it comes to raising the matter in the House. Does the right hon. Gentleman agree that because an underlying Government policy is driving the size and shape of the market, it is essential that Government take some responsibility for sorting things out? The problems would be bad enough in a free, consumer market with people buying and selling a service, but the market exists on the scale that it does because of the Government policy and obligations on energy companies.
Alistair Burt
It is quite right that Government should want to ensure greater energy efficiency by carrying out a policy such as this. We all want our homes to be warmer and our energy usage to be reduced, and insulation is a key part of that. It is essential, as the right hon. Gentleman says, when the Government are urging people to have such work done, that there is some sense that it is carried out properly. If things go wrong, the Government must accept some responsibility and work with the agencies that are charged with dealing with the matter to make sure that they are doing so.
Finally, I want to repeat a concern raised by the hon. Member for Arfon, who said that when he mentioned the issue locally, people appeared and said that it had been a problem for them. That is what worries me the most. If the Government want there to be a campaign on the matter by MPs all over the country, the best thing for them to do would be to defend what is happening and just say that they will look into it. If nothing is done, I promise the Minister that she will be back here with a room full of even more MPs, and that will not do anyone any good. Today offers a real opportunity to recognise the pain suffered by so many people and get something done, so that the agency lives up to its responsibilities and the companies involved know that they will be named and shamed for their work. The bottom line will be that consumers and our constituents will get a better service—the service that they deserve.
Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)
It is a pleasure to serve under your chairmanship, Mr Sanders. I begin by praising my right hon. Friend the Member for Southampton, Itchen (Mr Denham) for securing the debate and for the work that he has done to remedy the cases of badly installed cavity wall insulation in his constituency. As the hon. Member for Meon Valley (George Hollingbery) has said, cavity wall insulation, when it is correctly installed in an appropriate property, can offer substantial benefits to home owners. However, as we have also heard, badly or wrongly installed cavity wall insulation can cause serious problems. It is incredibly worrying to hear the examples of complaints and customer ordeals that right hon. and hon. Members have presented. I praise their constituents for their tenacity in attempting to resolve the problems.
I want to make it clear that I do not believe that anyone in the Chamber seeks to deride the insulation industry. Many good people are part of that industry, as I know from personal experience of meeting numerous installers in my constituency and in my Front-Bench brief, and from working closely with them on our energy efficiency plans. However, it is vital that within that industry, consumers are protected. They should always be at the forefront of any work that takes place, especially in connection with any policy promoted by the Government.
The consequences of badly installed cavity wall insulation are significant. Not only will a home owner suffer financially and personally trying to put it right, but, just as importantly, they will not receive the benefits that they should. The Minister and I regularly debate the fact that we have some of the worst levels of fuel poverty and the least efficient housing stock in Europe. Although we disagree on the best way to tackle that problem, I am sure we agree that it is unacceptable when work that is done to improve the quality of our housing stock leads to the sorts of problems that have been mentioned today. The consumer should always be the focus of any energy efficiency work, because consumer behaviour is often as important as putting in energy efficiency measures. Unfortunately, I do not think that that has been a strong enough element of the Government’s approach to energy policy, or indeed of Governments’ approach to energy policy for some time. It is vital, therefore, to ensure that there is adequate protection for consumers and that any issues are dealt with in an efficient and satisfactory manner.
It was concerning to hear the criticism by my right hon. Friend the Member for Southampton, Itchen of the Mark Group, which I have visited. It is a major installer in the UK, and usually it is a useful resource in policy in this area. I will certainly discuss with it its response to complaints such as those that he raised. The issues that have been raised today concern me greatly. Data protection laws permitting, I, and, I am sure, the Minister, would like to know more details and consider how the problems can be rectified. I press her to look into that.
Having listened to my right hon. Friend’s speech, it seems to me that there is a clear need to be better able to identify where liability resides for work that has been done, including under the energy companies obligation. There also needs to be swifter redress when complaints are made. It is my understanding that all work carried out under ECO and its predecessor schemes, the carbon emissions reduction target and the community energy saving programme, is recorded centrally. In addition, the bureaucracy for ECO is substantial—I have attacked the Government about the scale of that bureaucracy on several occasions—so I would be incredulous if it were not possible to identify the funding body for each installation relatively easily. Perhaps the Minister will clarify the situation.
Right hon. and hon. Members have raised concerns about the independence and operation of CIGA. That is a particular worry, and I will look into it further. My right hon. Friend the Member for Southampton, Itchen briefly raised the question of subcontracting, which has concerned me for some time, especially within ECO. There is no limit on the number of times energy efficiency work under ECO can be subcontracted. My right hon. Friend talked about home owners not knowing who was carrying out the work or even being surprised to find out that it was funded by an energy company. During my work in the area, many people in the industry have raised the level of subcontracting with me as a concern. I would be grateful if the Minister could touch on that subject in her reply. Is she happy with the current level of subcontracting, or would she consider placing limits on the level of subcontracting that is allowed? That happens with schemes in other Departments, such as welfare-to-work contracts.
I recognise that there are good operators out there, doing good, honest work, who genuinely care about improving the energy efficiency of people’s homes. I know that that is true, because I have met them. Cases such as those that have been highlighted today are, thankfully, relatively small in number. That is why it is so frustrating that when such cases occur, satisfactory redress is not offered. It would be an absolute travesty if people who need better-insulated homes put off having that work done. That is why the problem of badly or wrongly installed work must be dealt with swiftly and firmly. The evidence provided in the debate suggests that that is not happening at the moment. Despite the relative rarity of cases of badly installed insulation, the examples have become numerous enough to warrant today’s debate and the previous debate secured by the hon. Member for Arfon (Hywel Williams). Home owners clearly need a better response than the one that has been offered to constituents in the cases outlined today. Specifically, on a point raised by my right hon. Friend the Member for Southampton, Itchen, it cannot be right for companies to charge for remedial work for badly installed cavity wall insulation in homes where it should not have been installed or recommended in the first place.
I praise my right hon. Friend once again for securing this debate and allowing us the opportunity to discuss these issues. I hope that the Minister will address directly the concerns raised, and I am interested to hear her reply. She and I have different priorities and approaches when it comes to policy in this matter, but we both recognise the centrality of improving the UK’s housing stock through better home insulation. The issues raised in this debate are a clear threat to public confidence in that, and it is in everyone’s interests that we seek to rectify them.
The Parliamentary Under-Secretary of State for Energy and Climate Change (Amber Rudd)
I thank the right hon. Member for Southampton, Itchen (Mr Denham) for raising the important topic of cavity wall insulation and the issue of compensation in cases where there have been problems. I will first comment on the policy generally and then move on to the conclusions from the debate and the specific requests that he made.
As I have said previously in energy debates, this Government recognise that improving domestic energy efficiency is a critical part of our strategy to deliver a secure, affordable, low-carbon energy system in this country. Consumer protection lies at the heart of the Government’s energy efficiency framework. We have built and nurtured strong relationships with a wide range of consumer protection bodies, including trading standards and Citizens Advice, and we are constantly seeking new ways to improve consumer protection.
In December, I personally sent out a joint communication with the chairman of the Association of Chief Trading Standards Officers to remind green deal market participants that it is their responsibility to uphold the green deal framework to ensure protection for all parties. When reports of potential breaches of the green deal code of practice are received, the Green Deal Oversight and Registration Body engages with the relevant authorities to investigate and address those reports, which can lead to action taken against the green deal participant, including withdrawal or suspension of green deal authorisation.
The Government set a target of 1 million homes to receive energy efficiency improvements between January 2013 and March 2015. I am pleased to say that we have already met that target and are on course to exceed it significantly; by the end of November 2014, more than 1 million homes had benefited from the installation of energy efficiency measures under the energy companies obligation and green deal framework. Cavity wall insulation has helped create millions of warm, energy-efficient homes in the UK. For many householders, cavity wall insulation is a sound financial investment, helping them save on their energy bills every year. A typical semi-detached household saves approximately £100 a year after the installation of cavity wall insulation.
Mr Denham
I apologise for intervening so early, but I have a question to which the Minister may well not know the answer, so this will give her time for a note to be passed forward. She mentioned the possible withdrawal of green deal certification. Does the Mark Group have green deal certification?
Amber Rudd
I thank the right hon. Gentleman for his consideration of timing. I will endeavour to come back to him on that point before closing.
Since 1995, uptake of cavity wall insulation has increased significantly with the launch of successive energy-efficient home improvement schemes by this Government and the last, including schemes aimed at fuel poverty such as Warm Front, and those focused on climate change, such as the energy company obligation and the green deal, which enable home owners to install energy efficiency measures, including cavity wall insulation. Between July 2010 and September 2014, 2.27 million homes had cavity wall insulation fitted; of those, 1.7 million did so under Government schemes. At the end of September 2014, 13.9 million homes had cavity wall insulation, or 72% of properties with a cavity wall. Up to the end of November 2014, some 462,103 cavity wall insulation installations were delivered under ECO, or 37.9% of total ECO measures, making them the most popular measure undertaken by households.
I will outline the protections in place for customers who receive cavity wall insulation. The installation of all cavity wall insulation must meet the requirements of the Building Regulations 2000, and the materials used to insulate cavity walls are subject to specific standards and must be certified by a technical approval body. To ensure the quality of installations under the green deal and ECO, installers must undergo a rigorous authorisation process to become authorised participants. Participants must comply with a publicly available specification setting out requirements for the installation of energy efficiency measures in existing buildings and levels of monitoring of those installations, including for cavity wall insulation. Furthermore, under the previous carbon emissions reduction target and community energy saving programme, and their successor schemes, the green deal and ECO, cavity wall insulation measures must be accompanied by a 25-year guarantee.
The green deal framework regulations require a green deal provider to agree, as part of any green deal plan, to guarantee the functioning of the improvements and to repair any damage to the property caused by the improvement. Under ECO and the CERT and CESP schemes before it, cavity wall insulation measures were required to be accompanied by an appropriate guarantee. Ofgem sets out the requirements for those guarantees in its ECO guidance: they must include a mechanism that gives assurance that funds will be available to honour the guarantee; the guarantee should last 25 years or longer; the guarantee must cover the costs of remedial and replacement works plus materials; there must be an assurance framework for the quality of installation and the product used in the installation. The suitability of the framework will be assessed and verification may be required through independent assessment by an independent United Kingdom Accreditation Service-accredited or other appropriate body. A list is available on the Ofgem website with details of guarantees that have been reviewed and are considered to meet the criteria for an appropriate guarantee under ECO.
Hywel Williams
I will ask the Minister a direct question put to me by one of my constituents. I said in my speech that my area is a category 4 area, and the hon. Member for Meon Valley (George Hollingbery) said that his was category 3. Should cavity wall insulation be installed in category 4 areas at all?
Amber Rudd
The hon. Gentleman will recall that we have debated that specific subject in this Chamber previously. My recollection is that mostly it should not have been. We went through the maps to which he referred in his comments, and the concerns that it had been inappropriately installed.
To return to the context of this debate, when the issue was put before the Government, we began conversations with the Cavity Insulation Guarantee Agency, which as we heard earlier is the largest cavity wall guarantee provider. We discussed the level and nature of existing complaints in order to understand the issue in further detail. The total number of complaints received by CIGA since 2010 is 6,890 and there have been 1.5 million cavity wall insulation installations since 2010, which implies a claim rate of 0.5% since 2010. The total number of outstanding unresolved cases on which CIGA tells me it is working is 171.
Amber Rudd
I will have to return to that question to give the right hon. Gentleman a full answer. When I conclude my comments, I will address some of his specific requirements, including requesting a meeting between CIGA and my Department officials and me after this debate, and I will ensure that that is one of the questions that we address.
Alistair Burt
Before my hon. Friend leaves that point, the bright spark in all this is that we know that she will take the issue seriously, as that is her reputation, so we appreciate that she is involved. If there are so few complaints, bearing in mind how much work has been done, is there not an even greater necessity for that small number of complaints to be properly dealt with? CIGA cannot complain that it is overrun with complaints, so why should some of them have been dealt with so badly?
Amber Rudd
That is a very good question, which I will put to CIGA. My right hon. Friend is absolutely right. I will require more content from CIGA than the answers that it has given us so far. CIGA has already said that it will provide us with a list of responses to particular questions raised with it, some of which have been raised in this debate, and I will be happy to share those once they are received.
If a consumer has concerns that cavity wall insulation has been installed incorrectly, they should initially contact the installer who carried out the original work to see whether the issues can be rectified. If that does not resolve the issue, they should contact the guarantee provider. If they cannot locate their guarantee, they can try to contact the guarantee provider directly, which may have a record of their guarantee.
For measures installed under the CERT, CESP and ECO schemes, if there is no effective guarantee in place, the customer can contact the energy supplier that funded the measure originally. If the energy supplier cannot be found via Ofgem, consumers may wish to obtain further guidance from their local trading standards office or seek professional legal advice.
If there is a dispute about a green deal installation and an agreement cannot be reached between the consumer and the green deal provider, the consumer can contact the green deal ombudsman, who will investigate complaints and determine redress. Depending on the type of complaint, the ombudsman will, following their investigation, refer cases to the Secretary of State to determine redress or impose sanctions.
The green deal registration and oversight body has a technical monitoring strategy in place to ensure the full compliance of all green deal participants. Furthermore, Ofgem mandates technical monitoring of installation standards under ECO and the predecessor CERT and CESP schemes, and it requires ECO installers to contract for independent inspections of 5% of all measures installed, including cavity wall insulation, to ensure that they meet the required standards. The hon. Member for Arfon (Hywel Williams) said that 5% is inadequate and insufficient. I will consider his comments and speak to Ofgem about whether it is sufficient and come back to him on that issue.
Jonathan Reynolds
Can the Minister confirm that Ofgem, given the paperwork that it demands for each installation under ECO, keeps a database of which energy companies have funded that work, on a postcode basis?
Amber Rudd
I will have to come back to the hon. Gentleman on that question.
Mr Denham
Adding to the list of things for the Minister to come back on, there is also the issue of installations carried out under CERT and CESP. It is clear from Ofgem’s Freedom of Information Act replies that it does not have those data. My hon. Friend the Member for Stalybridge and Hyde (Jonathan Reynolds) suggested that sufficient paperwork should be held somewhere to enable the match to be made between householders and energy suppliers, even under the two earlier schemes. Can the Minister advise us where that information is held? Will she make every effort to identify that information for each of those historical cases?
Amber Rudd
The hon. Member for Stalybridge and Hyde (Jonathan Reynolds) was right to raise that issue. I will review the regime for the legacy issues now and after the ECO regime expires in 2017. I agree that we need clarity about what happened in the past, and that we must make improvements for the future.
Let me move on to the suitability of cavity wall insulation for different properties. As my hon. Friend the Member for Meon Valley (George Hollingbery) said, not all properties are suitable. The hon. Member for Arfon and I have discussed that issue previously in this Chamber. A dwelling is suitable for standard cavity wall insulation if its external walls are unfilled cavity walls, the cavity is at least 50 mm wide, its masonry or brickwork is in good condition and its walls are not exposed to driving rain. It is important that cavity wall insulation is installed only in suitable homes and to the required standards. Pre-installation surveys are key in identifying suitable properties. Cavity wall insulation is not suitable in homes that are exposed to wind and driving rain, as my hon. Friend the Member for Meon Valley said.
The British Standards Institution’s regulations offer a step-by-step procedure for assessing properties’ suitability for cavity wall insulation and provide guidance for assessing exposure by looking at topography, shelter and rain spells. Technical certifications—for example, the BBA certificates—state how and where products can be used.
Members who have spoken in this debate have said that they want complaints to be properly handled, however many there are, and their constituents to get proper redress. It is clear that more needs to be done. The right hon. Member for Southampton, Itchen asked about the Mark Group. I can confirm that it is an authorised green deal provider. He requested several commitments from me, and I want to state clearly for the record that my Department and the Government take very seriously the concerns that have been raised about people’s homes. People’s homes are not just an asset or something that costs them money; they are essential to their livelihoods and well-being, which is why we take this issue so seriously.
I will speak to Ofgem, and I will write to it to ask for a summary of the number of complaints it has received and its view on that. I will consider conducting a review. I will consider the case for introducing independent oversight for all guarantees, not only those under CIGA. Concern about the guarantees, their implementation and access to them has been one of the features of this debate. I am concerned about the level of transparency—an issue that has been raised. The right hon. Member for Southampton, Itchen and others said that they were concerned about the independence of the directors of CIGA. I will have discussions with Ofgem about that issue.
The hon. Member for Arfon asked whether it would be possible to return to CWI properties after two years to ensure that the insulation was correctly installed. I will consider putting in place an independent assessment to look at properties two years after installation. I will also consider regulating the initial sales conversation—the right hon. Member for Southampton, Itchen raised that issue and quoted from various sales conversations. I have listened to the personal stories that Members have put on the record.
Mr Denham
The Minister has given us a list of things that she will consider. I agree with the right hon. Member for North East Bedfordshire (Alistair Burt), who said that the Minister will take those things seriously and pursue them. However, the dissolution of Parliament is approaching, and I and others will leave this place. Will she give me the satisfaction of promising to consider these issues and come up with answers before 30 March? It would be a great shame if she were to take this issue forward and, for whatever reason, not to find herself in the same position after the election. It is not unreasonable to ask her, in just under two months, to consider these issues and report back to the House.
Amber Rudd
I thank the right hon. Gentleman. He is absolutely right that I take this issue seriously and that I intend to get some answers on it. I commit to writing to him before Parliament dissolves to update him on where I am. I will do my level best to get as many answers as possible to address the concerns that he raised. I will start by making the points that I just outlined to Ofgem and asking for a meeting with CIGA to raise those complaints and issues.
Alistair Burt
On exactly the same point, I reassure anybody following the debate elsewhere that if my hon. Friend the Minister is not able to complete that work and get all the answers in that time, it will be possible to pursue these matters in the next Parliament, if the good people of North East Bedfordshire and Arfon allow it. Therefore, there should not be a break in our concerns. Our constituents can be reassured that the matter will be carried through, even if some distinguished right hon. colleagues will no longer be with us.
Amber Rudd
My right hon. Friend is absolutely right. Despite my commitment to come back to the right hon. Member for Southampton, Itchen with answers by the end of March, we are unlikely to have fully resolved the serious complaints and issues that have been raised here. I am sure that the future Minister, whoever they are, will continue that work, and I will ensure that it is left in good order for them. However, I hope I will be back in this role.
I thank all right hon. and hon. Members for their comments. I want to reassure their constituents that we take this issue very seriously, and I will continue to take a personal interest in it.
Work-related Activity Group
(9 years, 10 months ago)
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Dame Anne Begg (Aberdeen South) (Lab)
One of the conclusions that my hon. Friend and I reached as part of the Select Committee on Work and Pensions inquiry was that the work-related activity group was too wide and trying to do two contradictory things: to give support to people who are not fit for work without being in the support group; and at the same time to move those who might be fit for work closer to work. Those two different aspects of the WRAG meant that it became the default for everyone who either was now not fit for work, or definitely could not work in future. The group is too wide and too unwieldy.
Sheila Gilmore
I thank my hon. Friend, the Chair of the Select Committee, for that contribution. I will come on to this in more detail later, time permitting, because the situation we are in now is important. If we end up with a default group and people in it for a long time, one of the questions that has to be asked is, how much further have we progressed from where we started?
One of the problems seems to be that different rules or practices from those for people previously on incapacity benefit are being applied to new claimants. The new claimants who go into the support group may be placed there without a face-to-face assessment. In some situations people are having a paper-based assessment and, if people go into the support group, that might seem acceptable. The WRAG, however, has a detrimental effect on income and circumstances, which I will come on to, so if people go into that group because of a paper-based assessment, they will not have had the opportunity to explain more fully their particular circumstances. That might seem a rather strange thing to say, given the debate about there being too many assessments—I have been part of that myself in my Adjournment debates—but it is important that we get things right.
The Select Committee called for the rules to be aligned, so that no claimants could be placed into the WRAG without having an opportunity to explain their particular conditions and their impact to an assessor, but the Government in their response of November last year refused to accept that recommendation. I hope that the Minister has had further thought and might want to reconsider.
Between 2008 and 2014 about 30% of new claimants with Parkinson’s or multiple sclerosis were placed in the WRAG. Of those, some 5,000 were given the prognosis that they were unlikely to return to work in the longer term. The Select Committee recommended that all claimants with such a prognosis be allocated to the support group, not the WRAG, but the Government’s response was disappointing, stating that “with the right support”—which I will go on to say is not there—
“that person might be able to return to…work”.
The Government also consider that individuals might be able to adapt to their condition or that advances in treatment might become available. If someone goes into the support group, however, regular reassessments are carried out, so even if claimants were able to adapt successfully or treatments became available, that would be picked up. On its own, therefore, that is not a good enough reason for placing people in the WRAG.
That leads me on to the quality of support. When ESA was first introduced, the intention was that Jobcentre Plus would provide the support, but since 2010 the number of disability employment advisers has declined, meaning many ESA claimants receive no more than two face-to-face interviews per year or, in the experience of some of my constituents, sometimes fewer. Many are now referred to the Work programme, with numbers increasing significantly following the October 2012 decision to expand the range of people referred from those thought able to return to work within three months to those thought able to return within 12 months. Concerns about the Work programme are well documented, but it is particularly inappropriate for those incorrectly placed in the WRAG.
A constituent of mine was placed in the WRAG and referred to Work programme contractor A4E, but her only activity was to search for jobs on the internet, despite the fact that she has complex regional pain syndrome and would have been unable to take up any job offered. She was given little help with how her particular condition might be alleviated or supported, or about what contact she would require with employers to make that happen. Rather, the result was that her treatment was disrupted and her condition exacerbated. Indeed, recent analysis, quoted in the Select Committee report, found that only 5% of claimants from the WRAG who were placed in the Work programme have moved into sustained work since 2011, against a target of 16.5%.
A few months ago, an evidence-based review of the work capability assessment, the test for deciding whether people are eligible for benefit and which group they go into, examined whether different descriptors would work. Part of the process was to ask expert panels to look at the WCA outcomes. Interestingly, they identified that, of the claimants who were found fit for work, 83% would require, on average, two or three adjustments to be able to undertake employment, 50% would require flexible working hours, and 24% would require a support worker. That was a review of fit-for-work assessments; those requirements are likely to be even more necessary for those in the work-related activity group. Such support just is not happening through the Work programme.
I do not have a particular view on whether support should be provided through Jobcentre Plus or a contractor or other provider, but in addressing these concerns it is important that provision is not forced upon people who cannot benefit from it, and that those who can receive it get it in a form that is applicable to their needs and local circumstances. In that respect, I strongly support the devolution of responsibility and finance for the Work programme to local authorities, as many specialist local providers offer a much more effective and personalised service to those with health problems or disabilities.
As my hon. Friend the Chair of the Select Committee pointed out, there is a major flaw at the heart of the system, which explains some of the problems. The work capability assessment is trying to be a test of both eligibility for financial support and how close people are to being able to work. At the outset, there was in fact a further assessment called the work-focused health-related assessment, which was intended to explore the difficulties and obstacles that people would face in returning to work—that is, after eligibility for benefit had been determined, issues such as the obstacles to and distance from employment would be looked at.
In July 2010, the work-focused health-related assessment was suspended for two years on the grounds that it had not delivered the intended outcomes, although it seemed somewhat early to make that judgment as it was barely 18 months since the introduction of the benefit as a whole. In 2013, it was suspended for a further three years to await evaluation of the Work programme and universal credit.
Dame Anne Begg
The WFHRA, as it came to be known, was actually suspended before any existing incapacity benefit claimants had even been migrated on to ESA. It was that group in particular that would have benefited from some kind of assessment of their current and future barriers to work.
Sheila Gilmore
My hon. Friend is correct. There is no sign whatever that any evaluation was made that showed that it was not working. Do we need something better than the WCA to measure the obstacles and propose support measures? The answer must be yes. Does that necessarily mean two tests? I do not know—perhaps, or perhaps not—but it should be looked into properly so that we can decide how to deal with the issue. Scope, a leading charity in this field, has suggested replacing the WCA as a whole with a distance-from-work assessment to assess support needs rather than medical capacity.
The third issue that I want to address is the fact that the Government have both reduced the value of ESA payments to those in the WRAG and placed restrictions on its receipt that have significantly changed the character of the benefit. Although the value of payments to people in the support group has been uprated by inflation in both 2014-15 and 2015-16, payments to those in the WRAG have been subject to uprating by only 1%. Those in the WRAG are subject to the overall household benefit cap, whereas those in the support group are not. The Government justifies those differences on the basis that people in the WRAG are better placed to move towards the labour market, but I do not think that that is how the original architects of ESA would have envisioned the WRAG working. Under incapacity benefit, most of these people would have been given unconditional support, so it is wrong that the fact that they now receive some level of support with a view to an eventual return to work is being used as a stick to push them to get a job sooner than they are able.
The sorts of changes I have described have fed into the media perception that people in the WRAG are in reality fit for work. For example, on 1 April 2013, the Daily Mail ran a story under the headline “Just one in eight on sickness benefit is truly too ill to work”. It reported that of nearly 1.5 million new claims assessed for ESA since 2008, 837,000 were found fit for work and 232,000 were
“deemed by doctors to be too unwell to do any sort of work”—
that is, they were in the support group. It then said that
“a further 367,300 were judged able to do some level of work”,
which was clearly a reference to the WRAG and implied that such claimants were not truly too ill to work. Actually, the whole point of the test is to say that at this point in time they are deemed unfit for work.
A related change was the decision to time-limit the receipt of contributory ESA to one year for those in the WRAG, on the basis that they are likely to get better anyway and so will be in less need of the benefit than people in the support group. However, in contrast to incapacity benefit, ESA was designed with regular reassessments in mind, so were there to be any improvement and therefore lost of entitlement, that should be determined through the process of reassessment, rather than an arbitrary one-year time limit. Such a limit particularly affects people who have been in work for much of their life and therefore made their contributions, but who may, for example, have a working partner—possibly earning only part-time wages—and so reach a position in which they receive no payments whatever.
Another issue is that the letters that people receive to tell them about changes in their circumstances are very unclear. One former incapacity benefit claimant came to my surgery last year after he had received a cryptic letter from the DWP. He understood it as saying that he would continue to receive benefit, but became concerned several months later when he learned that his benefits were due to stop in a few months’ time. It turned out that he had been placed in the WRAG but was time-barred from appealing the decision. I hope that the Government’s proposed review of all ESA-related communications will address such issues. My experience is that people are still receiving letters that are hard to interpret. They tell them that there has been a change in circumstances and perhaps that there will be a slight change in the amount of money that they will receive, but they do not make it clear why, which of the ESA groups they are in, and the overall implications. It is important that people are given the information that they need in order to take the appropriate action.
In conclusion, it is worth quoting the Select Committee again, which concluded:
“The WRAG is by far the most problematic of the three ESA outcome groups.”
I know that it is likely that many of the policy changes that I have mentioned have been driven by financial considerations, and I do not necessarily expect the Government to change all their positions in the remaining few months of the Parliament. Nevertheless, I would like to think that these matters are under consideration and that there is a real attempt to overcome some of the problems and issues that I have mentioned. For example, good communication should not be beyond the bounds of possibility, even in the dying days of this Parliament. That could save money in the end, because if people understood what they were being told they would be much more likely to take the appropriate steps.
It is profoundly unfair that people in the WRAG seem to be shouldering a disproportionate burden in reducing the deficit, and I hope that whichever party or parties are in government after the election take a different approach. No claimants should be placed in the WRAG without a face-to-face assessment, and only those able to benefit should be referred to the Work programme, if it continues—I hope that it can be improved considerably, or devolved so that we can use the specialist providers with which we have all had contact and that do such a good job. Ministers must acknowledge that those in the WRAG are currently too ill or disabled to work.
The Minister for Disabled People (Mr Mark Harper)
It is a pleasure to serve under your chairmanship, Mr Sanders. I congratulate the hon. Member for Edinburgh East (Sheila Gilmore) on securing the debate and raising these important matters. I will come to her point about communication later, but there is common ground there, and I hope to update her on that. We may not agree about some of the policy changes, but it is very welcome that we agree that we should communicate clearly and put in place plans to improve communication.
I think that the hon. Lady acknowledged this in her speech, but to be clear, the policy intent of the work-related activity group, as well as that of employment and support allowance more generally, remains as it was when it was introduced by the Labour Government in 2008: to help people to return to work wherever that is possible. We know that there are generally health benefits from working and work-related activity.
The hon. Lady mentioned people with progressive conditions. I touched on this issue when Dr Litchfield published his final report. If they are arguing that the diagnosis of a progressive condition such as Parkinson’s or multiple sclerosis effectively means that someone should go into the support group, with the assumption being that they will probably never work again, some of the groups that represent those people should think about that, because it has a lot of consequences for how we treat people with progressive conditions. It kind of sends a message to employers that if someone gets diagnosed with one of those diseases, they should just be sacked because they cannot contribute anymore, even though some of those conditions are progressive over a long period of time. We have to think about how we treat people with those conditions.
Clearly, there will be a point in a progressive condition when someone is perhaps not able to work, and perhaps not able to work again, but we should not assume that the diagnosis of a progressive condition automatically means that someone in the support group is never able to return to work. That would send out some unhelpful messages that those groups—when they are not arguing about whether people qualify for benefits—do not themselves argue. They argue that people should be able to remain in the workplace while they can, and should be properly supported in that.
Sheila Gilmore
I point out to the Minister that the reason why people are claiming this benefit at all is that they have fallen out of the work force. Often they have been through a period with their former employer in which they were trying to stay in the work force. We are not necessarily dealing with people who will find it easy to work under any circumstances.
Mr Harper
I accept that point, but employers vary in their ability to deal with people with health conditions and disabilities. Some are better than others. For example, we know that some employers retain almost everyone in their organisation who develops a mental health problem, because the employers can deal with that effectively. Some employers, however, are not good at dealing with that. The only point I was making was that the diagnosis of a progressive condition should not mean that we automatically assume that the person will go into the support group. The other thing is that there are many conditions in which the symptoms fluctuate. It may be that someone has to have a more flexible work regime—sometimes they can work and sometimes they cannot. All I am saying is that it can be a little more complex, and a progressive condition should not automatically trigger a diagnosis-based referral to the support group.
Dame Anne Begg
There will be people in the support group who are or can be in work. The ability to work is not the correct definition for who should be in the support group and who should be in the WRAG group.
Mr Harper
I accept that point. There are of course people in the support group who do permitted work. I think that the hon. Member for Edinburgh East was arguing that it was somehow inappropriate for those diagnosed with progressive conditions to be put in the work-related activity group and expected to undertake some form of work-related activity. I was simply making the point that it does not follow that putting someone with a progressive condition in the WRAG is inappropriate, and that they should automatically be in the support group. That was the only point I was trying to make.
The hon. Member for Edinburgh East made a good and sensible point—she raised this at my Select Committee appearance last week, and I promised that I would respond to her—on some of the communication. Letters that say to people that they are not expected to return to work—I cannot remember whether it said “indefinitely” or “ever”—are not very well worded. We are looking at all our communication. We have a freeze on IT changes until we do the cutover from Atos to Maximus, but once that is out of the way, we will change the wording on the assessor recommendation. The hon. Lady made a good and reasonable point in the Select Committee session last week; the wording as set out does not accurately reflect the position.
The hon. Lady also raised the point about the work capability assessment generally. We will respond to Dr Litchfield’s report in due course, but he said that the WCA was not a perfect assessment, and I would not pretend that it was. He also made the point, however, that there is not a magic alternative assessment that can be pulled off the shelf. As the hon. Lady knows—I think she remarked on this in her speech—a number of experts looked at whether there was an alternative way of assessing people’s need for benefits and for support to move into the workplace, and there was not a magic solution there either. That demonstrated that the WCA is a pretty good assessment. I would not pretend that it is perfect, but it is probably the best that there is. One thing Dr Litchfield suggested is that we give the WCA a period of stability, so that it can settle down, rather than continuing to make changes to it on a permanent revolution basis.
The hon. Lady also discussed whether we should be able to refer people to the work-related activity group without a face-to-face assessment. As we said in our response to the report—I think this blends the two slightly contradictory points that she made—we should not have unnecessary face-to-face assessments. Decisions are made on the basis of the papers without a face-to-face assessment only if the decision maker believes that the information in front of them is clear and provides sufficient evidence to make a decision. The person about whom that decision is being made will not always agree with the outcome, which is why they can apply for a mandatory reconsideration, and if they do not agree with that, they can appeal.
In cases where the decision maker is clear that there is sufficient evidence to make a decision, having an unnecessary face-to-face assessment—an assessment that, in other cases, the hon. Lady is not a fan of—is not an enormous step forward. She will know from the statistics we publish that the average length of time to complete a mandatory reconsideration is 13 days, and we complete three quarters of them in 30 days; that is not an enormous barrier put in the way of someone having their case looked at again and then being able to appeal the decision if they think they need to.
Sheila Gilmore
I have certainly come across cases where the decision made on a paper-based assessment turned out not to have used all possible sources of information. That did not come to light until a later date, and that is one of my concerns about the process. People can be placed in a detrimental position, both financially and in terms of the conditionality they are expected to follow.
Mr Harper
I think the hon. Lady’s point, which is perfectly good, is that we need to ensure that we make accurate decisions using all the information, that we get the information in the first place, and that we have properly explained to the claimant what information we need. She is right that we should make those decisions accurately, but that does not in itself suggest that making those decisions on the papers is wrong where there is sufficient evidence to do so. Saying that everyone has to have a face-to-face assessment when there is sufficient evidence is not a good argument. The fact that there are some cases where someone might not have made a good decision does not in itself invalidate the system. It is inevitable; however brilliant the system, there will always be cases where someone does not agree with the outcome, and is successful either on a mandatory reconsideration or on an appeal.
The hon. Lady referred to the communications that we send out. In Dr Litchfield’s fourth review, he recommended that we look at all the key ESA letters and forms to ensure that they are in plain English. The main ESA50 form has been reviewed and will be issued later this month. The decision letters are on a later time frame. The ESA260 form, which notifies someone of the decision in the first place, was revised last October. I looked specifically at the point on contribution-based ESA and the time limit because I know she is concerned about that. If someone is getting contribution-based ESA, it is clear that that is what they are getting. It is clear that that is time-limited, and that the time limit does not apply if they are in the support group. We are starting to do that work, as Dr Litchfield recommended, to improve our communications. There is more to do on that, and the hon. Lady is right to highlight that.
On the Work programme, which the hon. Lady referred to, it matters what time period one looks at. It is perfectly fair to say that in the first year of the Work programme, only one in 24 of the people claiming ESA moved into work, but up to the end of June last year, one in 10 ESA claimants had had at least three months of work within the first 12 months of being on the Work programme, which is a considerable improvement on its initial period and above the minimum performance level of one in 14. We want to improve the one in 10 figure, but she should acknowledge that the Work programme has improved its performance for this group of claimants. It has got a lot better, but we want to continue to improve it.
On the specific case that the hon. Lady referred to, an employer should have dealt with adaptations and hours of work through reasonable adjustments. On the issue to do with support workers, people can get support through the Access to Work programme. It is about ensuring that someone who goes through the Work programme has—
Respiratory Health
(9 years, 10 months ago)
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Stephen McPartland (Stevenage) (Con)
It is a pleasure to serve under your chairmanship, Ms Dorries. I would like to talk about respiratory disease, which affects one in five people in the UK, is responsible for about 1 million hospital admissions and costs the NHS almost £5 billion a year. It is also the third biggest cause of death in the UK. It is the poor relation compared with the investment that goes into tackling the other four big conditions. To put that into context, in 2012, respiratory disease killed 80,000 people—that does not include lung cancer, which killed an additional 35,500 people.
The UK also has the highest mortality rate for respiratory disease among the OECD nations, double that of countries such as Poland and Germany and treble that of countries such as Estonia and Finland. Sadly, the worst thing about those statistics is that many of the deaths would be preventable with the right care. I understand and welcome the announcement by the Secretary of State that he is making it a priority for NHS England to prevent people from dying prematurely from respiratory disease. His ambition is to make us one of the best in Europe for survival rates by improving prevention, diagnosis and treatment. That is a very big statement and a huge aspiration when we are talking about reducing respiratory deaths in this country by almost two thirds.
I want to focus my remarks predominantly on asthma and chronic obstructive pulmonary disease—known as COPD—which together affect almost 6 million people in the UK, including me. I am chairman of the all-party group on respiratory health. With the support of Asthma UK and the British Lung Foundation, we conducted an inquiry into respiratory deaths in an effort to help the Government and the NHS to understand why so many people are dying from these conditions and what can be done to prevent that. I am grateful to the other members of the all-party group for their support, and for the amazing contributions that we receive from patients.
Sir Oliver Heald (North East Hertfordshire) (Con)
I pay tribute to my hon. Friend for his work as chairman of the all-party group. What does he make of the NICE evidence that about a third of the people who are receiving treatment should not be, while there is such a lot of undiagnosed asthma? That seems very odd.
Stephen McPartland
My hon. and learned Friend makes an incredibly important point, to which I will return later. The information that has come out of NICE is sadly testament to the complacency that we see regarding the effects of respiratory disease, and to how some professionals and patients treat the condition, ultimately resulting in those patients’ deaths.
Contributors to the all-party group’s report include health care professionals, charities, patients, families and professional organisations, as well as a range of other people who contributed both written and verbal evidence. I will read the story of one of those people a little later, but first I want to look at chronic obstructive pulmonary disease, which is an umbrella term for a set of conditions that includes bronchitis and emphysema. Combined, such conditions kill more than 30,000 people a year in the UK—around 5% of all deaths in the UK from all causes. A COPD patient’s journey is often punctuated by multiple exacerbations, which are sudden worsenings of the symptoms, often triggered by external factors such as infection and problems with air quality, that often lead to hospitalisation.
To put it into context, people suffering from COPD exacerbations are the second most common cause of emergency hospital admissions in this country, the biggest being ischaemic heart disease, which is effectively coronary heart disease—heart attacks and strokes. It is estimated that COPD leads to 94,000 admissions a year, with cold weather often a major contributory factor. The direct costs on the NHS are more than £800 million a year, so COPD is causing a huge problem in terms of the costs for the NHS and the impact on individual patients. One of the worst statistics that the all-party group’s inquiry came across was that 50% of people who are admitted to hospital with severe COPD die within four years—once it has reached the stage of their being admitted to hospital, they sadly have a life expectancy of four years.
Caroline Nokes (Romsey and Southampton North) (Con)
I congratulate my hon. Friend on having secured this debate. Does he agree that there is a real problem with undiagnosed COPD, which is contributing to those hospital admissions? People are presenting for treatment only when they are in crisis.
Stephen McPartland
My hon. Friend makes an important point. In fact, we believe that more than 2 million people in the UK have COPD but are completely undiagnosed. The British Lung Foundation has done a great deal of work to try to raise the profile of COPD. It has also done a great deal of work on pulmonary rehabilitation with its “Breathe Easy” groups, which help people who are suffering from COPD to access support networks and improve some of the scarring and problems that they have with their lungs. A recent study of more than 39,000 COPD patients showed that more than half had symptoms for six to 10 years before the diagnosis was made—my hon. Friend’s point is powerful—and 42% had has those symptoms for up to 15 years before being diagnosed.
I want to tell the story of Neil, 50 years old and from Norwich. He was continually misdiagnosed by doctors despite being at high risk of lung disease and showing signs of the condition throughout his 30s. By the time he was finally diagnosed, he had lost most of his lung capacity.
Neil was a long-term smoker who worked for many years in cold and dusty conditions. When he was younger, he visited doctors regularly and had breathless attacks that sometimes required emergency treatment in hospital. However, he was never offered a lung function test by his doctor, and he felt that his smoking habit was used as a reason to dismiss his symptoms and not investigate them fully. At the age of 39, he finally managed to see a specialist in the hospital, but his symptoms led doctors to think that he had asthma.
When a doctor told him the extent of the scarring and damage already done to his lungs, Neil decided to quit smoking on that very same day. He also cut back on some work to improve his working conditions. Five years ago, he developed two bouts of pneumonia. His health deteriorated: he felt constantly breathless and could barely walk 50 feet. Even at that stage, Neil was not given a lung function test or information about how to manage his condition; instead, he was told that he could expect to recover soon. He was forced to give up work completely and his wife Wendy had to start caring for him.
Eventually, a doctor told Neil that he had COPD. He had lost 70% of his lung function by the time he was told that he had COPD. He was able to speak to a specialist nurse at his local surgery who took the time to work with him and got him referred to pulmonary rehabilitation, and he became a member of one of the British Lung Foundation’s “Breathe Easy” groups, which are support networks that help people with COPD to come together to improve their conditions and exercise levels, to move forward and to improve themselves all round.
Neil can now talk quite a bit, and he speaks at length about his condition. He has decided that everyone who attends a “Breathe Easy” group becomes an expert on respiratory health and care. Fortunately, his experience was positive in the end, but he had lost 70% of his lung function before he was diagnosed with COPD—that could have been done five or 10 years earlier. Sadly, Neil’s story is a classic example of what is happening right now in GP surgeries and hospitals throughout the country. People have a right to know if they develop such a condition, and they must believe that they will receive the treatment that they want and deserve when they come forward with it.
A big Public Health England awareness campaign is due to take place in the east of England, involving a breathlessness exercise. I did it myself last year in Stevenage—although I would urge Members not to look at the photograph on my website that shows me taking the test because it was a bad hair day and it is an odd photograph—and the nurses were able to tell me that I had asthma, which is very well controlled. Throughout the day, they diagnosed a number of people with COPD, asthma and a range of other respiratory diseases. Had that bus not turned up in Stevenage and those volunteers had not been given those tests, a large number of those people would not know that they had a respiratory disease. Fortunately, the campaign will be rolled out across the whole of the east of England, so I hope that the Minister will visit it and identify whether it is a positive thing that could be rolled out throughout the country.
The NHS health check for those between the ages of 40 and 74 does not include a lung function or respiratory disease test, but 13% of all people over the age of 35 already have COPD. A lung function test should be included because, as my experience on the breathlessness bus in Stevenage showed, such a check would pick up large numbers of people, enabling them to get the care that they need. They will then be able to push on with their lives, instead of having to wait 10 years and only being told, when they are admitted to hospital with the possibility of dying within four years, that they might have COPD.
I am passionate about the need to improve basic care for people with asthma, and I join Asthma UK in highlighting the seriousness of a condition that affects 1.1 million children and 4.3 million adults in the UK. The sort of headlines that we saw last week, which were referred to by my hon. and learned Friend the Member for North East Hertfordshire (Sir Oliver Heald), are unhelpful when we know that too many people are complacent about asthma. Every 10 seconds, someone in the UK has an asthma attack. Every single day, on average, three people die in the UK from an asthma attack. The national review of asthma deaths, which was led by the Royal College of Physicians, suggests that two out of three of those deaths are preventable.
That review by the Royal College of Physicians was the first such review in this country. It was begun in 2012 and lasted a year, and it was published in May 2014. It found that 57% of people who died from asthma were not recorded as receiving specialist care 12 months before their death; 47% of those who died had a history of hospital admissions; and 21% had attended A and E within the previous 12 months. A written asthma action plan is a step-by-step guide to managing asthma and provides individuals with guidance on what to do if they have an asthma attack, but only 23% of the people who died had an asthma action plan, so more than 75% did not have one.
The Royal College of Physicians found that many asthma deaths could have been avoided had staff received better training. In fact, the expert panel found that 46% of such deaths could have been avoided had the existing asthma guidelines been implemented. The review also found evidence for both over and under-prescription of reliever inhalers, the blue bronchodilators. On average, someone should receive 12 inhalers a year; a number of people are receiving far fewer than 12 and, among a variety of other figures, some are receiving up to 50 inhalers a year. Just from the number of prescriptions, we can identify the target audience of people who will be seriously at risk of dying from an asthma attack.
The statistics and the all-party report both make it clear that too many people are not getting the basic levels of care and that there is great variation in the standards of that care across the country. It is essential that clinical standards are followed consistently. I have asthma myself, so I understand that the condition is complex and variable and should be taken seriously. People with asthma should continue to use their inhalers routinely and ensure that they attend their annual asthma review, at which they may discuss their diagnosis, medications and written asthma action plan.
Last year, more than 1 million people who have asthma did not turn up to their asthma review. I did, because my wife, my mum and my asthma nurse all gang up on me and force me to go every single year. They almost insist on me having my flu jab twice a year. In Parliament, I normally host a session for people with respiratory conditions to have their flu jabs each year. Unless I provide a picture of myself receiving the needle at that session, I am required to have another at my GP’s surgery in Stevenage. So I have to smile at the camera while the lady enjoys stabbing me with a needle—I am sure she takes a little longer than she should. I do that every year.
Let me tell the House about my experience of asthma. I was diagnosed with it when I was eight, and I am now 38 years of age. The Minister will be shocked and disappointed to know that my treatment has not changed in 30 years. The experience at the doctor’s that I had when I was eight is exactly the same as my experience now, except that nowadays I see an asthma nurse, whereas then it was a doctor. The asthma nurse takes the time to go through my peak flow monitor with me, and she weighs and measures me—I think I get shorter every year, and a little heavier—but in effect that is what the doctor was doing when I was eight, although then I was getting slightly taller, if slightly heavier too. The reality is that things have not changed at all.
I was one of those children who was diagnosed with bronchitis from the age of about five until I was eight. The doctors thought, “Oh no, it hasn’t gone in three years, so he must have asthma”, so I was given my inhalers. If I turned up to the doctor’s and said, “I have got this or that”, they would say, “Are you using your inhalers?” I would reply, “Yes, I am using my inhalers.” They would say, “Why don’t you take your blue reliever inhaler”—they call it a Ventolin bronchodilator—“a little more?” That would be my treatment. I have not had antibiotics, but if I were younger, they might have given me a two-week course of them and told me to come back if whatever it was had not cleared up. In effect, that is what I got when I was eight and what I get now when I am 38. That is why we have the highest rate of respiratory deaths among the OECD countries—the treatment for asthma for people at GP surgeries up and down the country has not really changed. It is exactly the same.
There has been some progress. I am delighted to report that after a campaign of three and a half years by myself, other Members of Parliament and Asthma UK, for the first time we can now have asthma inhalers in first aid kits in schools. It took us three and a half years, which is ridiculous, because those inhalers are prescribed medication, which could not simply be given out by a teacher.
Sheryll Murray (South East Cornwall) (Con)
My hon. Friend might be aware that before I came to this place, I was a receptionist for a GP. One of the biggest problems that parents find is that they do not have two inhalers prescribed at the same time for their child, so that one can be kept at school and one at home. That is one reason why we need to ensure that all schools have an inhaler for use in an emergency.
Stephen McPartland
My hon. Friend makes an important point. I suffer from that myself, so I have an overnight bag in Parliament in case we get stuck here until 4 or 5 in the morning, and it has an inhaler in it. I had to get that inhaler off my dad, because I could not get another one off my own GP. I am a Member of Parliament, but I could not get myself an extra inhaler, so I am not sure what chance a child has of persuading an extra inhaler off the doctor, which his mates will probably just play with. I understand such problems, which is why I said earlier to the Minister that the treatment for asthma has not really changed in the 30 years that I have had it. There has been progress and good news—a number of children will not now die of asthma attacks in school over the next five to 10 years, because those inhalers are in first aid kits. Instead of a mate lending one, it will now be a matter of simply getting it out of the first aid kit, which is good news.
We are seeing great examples of innovation and high-quality asthma care throughout the country, with health care professionals working tirelessly to improve outcomes. They are looking for a cure for asthma. There are centres of excellence, such as the Royal Brompton hospital in London, which provides life-saving specialist care for people with severe asthma—I hope I never have to visit the place. The UK has some of the best asthma researchers, changing the way we think about the causes of asthma. In my constituency thousands of GlaxoSmithKline scientists are working on managing the condition of respiratory diseases on a daily basis; they are leaping forward with the ways in which we can manage such conditions. I thank them all for their brilliant work.
I am sure the Minister is aware that we have some recommendations and questions for him. Shockingly, the NHS does not track its own performance on asthma care. Despite asthma being one of the most common long-term conditions in the UK, no robust data are available. We would like to see a national clinical audit for asthma. Will the Minister commit to supporting such an audit and raise the matter with NHS England? An audit has the potential to stop people needlessly dying from asthma attacks, to improve the quality of life for people with asthma and to reduce costs for the NHS significantly. Such audits are already well established for other long-term conditions such as diabetes.
There should also be greater investment in asthma research. Research into the treatment and care of asthma and other lung conditions is chronically underfunded compared with other conditions such as the other four big killers. The amount of money committed to researching asthma simply does not match the burden it places on the NHS. In spite of that, amazing breakthroughs are taking place and there is potential. Asthma UK is working with the European Asthma Research and Innovation Partnership to establish a new fund to research and develop asthma drugs, with the ultimate aim of finding a cure for asthma. Will the Minister meet me and Asthma UK to explore how the Government can support the European innovation fund?
A variety of asthma research demonstrates that many people have allergies. Of those who have asthma, 50% are more than likely to have some kind of allergy that causes an asthma attack—we call them triggers. We do not have the lung function or capability that those without asthma have, so we have to learn quickly what our triggers are and avoid them. One of my triggers is pets, so although I am 38 I have never had a pet, which is quite sad.
We would also like to see written asthma action plans. The Secretary of State for Health has made a positive commitment to ensuring that every asthmatic has a written asthma action plan, so will the Minister tell us what plans the Government have in place to achieve that commitment? Once someone has an action plan it helps to reduce the seriousness of their attacks, because they learn quickly to manage their own condition. It is a serious condition, and people have to work on improving things such as their peak flow. There are bits and pieces that doctors and asthma nurses do with asthma sufferers—we compete with ourselves to try to improve in our asthma action plan.
We believe that there should be world-class asthma reviews containing key components; that is an item that came up in the national review of asthma deaths. It could result in a nationwide improvement in asthma. A variety of organisations are ready to help to develop the idea and work with the Department of Health and NHS England to make it a reality. The national review found that many asthma reviews did not include key components—only 27% of people had their asthma control assessed, only 42% had an assessment of their medication use and only 71% had an assessment of their inhaler technique. People are using their inhalers in a variety of ways, and could be losing between 40% and 60% of the medication’s effectiveness if they are using them incorrectly, yet almost 30% of people are not being assessed on an annual basis on how they use their inhaler. That could reducing the effectiveness of their medication.
We would like the Minister to support the creation of a world-class asthma review and to encourage NHS England to get on and actually do it. We know that NHS England is working on an improvement programme for children’s asthma, and we would like him to commit to continuing to resource that project into 2015-16. We have already seen significant successes in secondary and tertiary care for children.
It would not be a debate on asthma without a call—I have to declare an interest here—for free prescriptions for those with asthma; all asthma sufferers would like that. People suffering from many other long-term conditions receive free prescriptions for their inhalers, but asthmatics do not. If asthmatics do not take their inhalers they end up in an A and E facility receiving oxygen, normally after an ambulance crew has transported them there, giving them oxygen on the way. That costs a huge amount of money.
My final point is that smoking is a contributory factor in more than a third of all respiratory deaths. The health impact of smoking on asthma sufferers is enormous, so I personally call on the Government to get on and do all they can to push forward standardised packaging for cigarettes as soon as possible.
Nadine Dorries (in the Chair)
Order. We will have a series of votes starting at 3.31 pm, so it would be great if Members could bear that in mind if we do not want to have to suspend the sitting and then return.
Sheryll Murray (South East Cornwall) (Con)
It is a pleasure to serve under your chairmanship, Ms Dorries. I congratulate my hon. Friend the Member for Stevenage (Stephen McPartland) on securing this debate.
Our respiratory health can be affected by many different things. I want to talk about an aspect that we often do not consider: allergic reactions that affect our breathing and can lead to a fatality. I will tell hon. Members a story about the eating of peanuts. I was unaware of the effects of actions that we take for granted on people who suffer from a peanut allergy until I spoke to my constituent Natalie, and I want to share her story with Members today. In Natalie’s own words:
“The last time I went in to anaphylactic shock it took about 3-5 minutes to make itself known—with each reaction this time will get shorter”;
that is what she has been told.
“I had some warning signs first. I always get a spot on my lip and an itchy tongue, so we went to buy some Piriton and on our way back I went in to anaphylactic shock. First I was just coughing—very weak coughs—and I think that lasted for a few minutes though I am hazy on the whole night. Then what I call ‘phase two’ moved very quickly, it felt like there was a lump in my throat, which it probably was as I was told later that I had hives (Urticaria) on my windpipe and this is what causes anaphylaxis. ‘Phase three’ moved even faster. I had to sit on the pavement as I couldn’t walk any further and I was trying to take control of my breathing. We rang the ambulance somewhere around phase three—I didn’t have an epi-pen because we didn’t know I was anaphylactic—the ambulance arrived very quickly but I was really light-headed by the time they arrived, I couldn’t see anymore and everything was white. My chest was so tight and it was so difficult to get any air in…it feels like being crushed by an elephant and only being able to breathe through a tiny straw. The ambulance men helped me up and gave me the nebuliser like what they give to asthmatics and by the time we got to the hospital I was feeling much better.
If I did have an epi-pen it would have given me around 30 minutes before the ambulance arrived but the reaction can start up again after the adrenalin wears off.”
As a result of that incident, Natalie came to me with a suggestion that I hope the Minister will take on board. She told me that on many occasions she has been in a pub where there are peanuts on the bar or has walked past peanut vendors in the street, and although that does not send her into full anaphylaxis, it makes her chest very tight and she has to remove herself. Some people have suggested to her that she should take antihistamines, but with the amount of allergens around that would not be wise, as if she accidently comes in contact with allergens, any antihistamines she has taken would block the warning signs and give her much less time.
Street stalls vending peanuts and pubs providing peanuts for their customers are things we take for granted and assume are harmless. Many people do not realise that simply being near peanuts can have a devastating effect on someone’s health. Will the Minister join me in calling for wider education and publicity about the harmful effects that being near peanuts can have on some people’s respiratory health?
Sir Oliver Heald (North East Hertfordshire) (Con)
Rightly, my hon. Friend the Member for Stevenage (Stephen McPartland) and other Members who have contributed have talked about the most serious incidents and life-threatening situations. I want to say a few words about mild asthma, of the sort that can affect someone playing sport. If we are talking about campaigning about asthma awareness, there are quite a lot of people who are not going to die because of their asthma but whose lives are spoilt by it.
My own experience is that when I was young I was a keen rugby player. I could play rugby, but after a match I was always wheezy. It never occurred to me that that was because of a medical condition, but I was talking to my doctor one day, when I had been playing rugby for years—I was in my teens at the time—and he said, “Actually, we can help you with that.” He gave me an inhaler and told me to take a puff before I played, and my life was transformed. There was no more wheezing and I improved; I was able to play rugby much better, and was able really to enjoy it for the first time. There must be a lot of people in the country who have not really realised that they have asthma, as it is undiagnosed.
My first point is that in making people aware of respiratory conditions we are talking not just about saving lives but about improving the quality of people’s lives. I am told that there are any number of top sportsmen who have the same condition of mild exercise asthma.
Caroline Nokes
My hon. and learned Friend makes an interesting point. This is a problem not just for elite sports players and those who participate in sport regularly, but for those who are not active enough, or not taking part in any physical activity. They tend to look for reasons not to take part in those activities and being a bit wheezy, for some, can be a convenient excuse.
Sir Oliver Heald
My hon. Friend makes a good point. It is easy to see this issue as 1 million hospital admissions and the third highest cause of death, without also looking at the huge effect on other sufferers. We know that 5.4 million people are being treated in the UK for asthma, and I rather share the view that the National Institute for Health and Care Excellence, in saying that a third of people have no symptoms at any particular time, may be making a slightly complacent comment. By the time I was in my late 20s I had no symptoms at all and I no longer needed to use an inhaler to do sport. However, when I had a problem one year with flu, they came back. It is a variable condition, and that can be underestimated.
Kay Boycott, the chief executive of Asthma UK, said:
“Asthma has many complex causes, which is one of the reasons why it is sometimes difficult to get a definitive diagnosis. It is also a highly variable condition that can change throughout someone’s life or even week by week, meaning treatment can change over time.”
One of the great lessons to learn is that we need to monitor regularly for asthma. My hon. Friend the Member for Stevenage made a particularly important point about attending the asthma clinic for the test.
The Royal College of Physicians recently made a point about variability and how asthma can suddenly deteriorate. As it said, there are different kinds of asthmatics: brittle asthmatics who can move from having no wheeze to severe problems; others for whom it appears just in the early morning; and others for whom it disappears for a period. We need more research and a campaign on awareness.
Mark Hunter (Cheadle) (LD)
I apologise for being late for the start of the debate. Does the hon. and learned Gentleman agree that variability is one of the key problems with asthma? From hon. Members’ contributions, it is clear that each of us who suffer from asthma have different experiences of it. One of the biggest challenges, which has been brought home by the medical advice I have been given by doctors over the years, is never to underestimate asthma. One of the problems is that so many long-time sufferers think that they are in control, and that their medication is on top of it. He talks about the condition being variable for people with mild symptoms, but it can be a killer. A key part of the campaign that all of us want to support is about ensuring that people have regular check-ups and do not ever take asthma for granted.
Sir Oliver Heald
That is exactly the point that I was coming on to make. It would be a mistake to assume that because NICE found that one third of the people it looked at had no symptoms, those people could heave a sigh of relief and forget about asthma for ever. People—as I did—can have periods when they are symptom-free, but they still need regular reviews to ensure that it does not come back or suddenly get worse.
The Royal College of Physicians identified major avoidable factors in two thirds of cases where people died, which were about the constant monitoring and attention to detail that my hon. Friend the Member for Stevenage mentioned. It did not cite all the evidence, but it seems that there are two unstable types of asthma that are often resistant to treatment and that can be a contributory factor. We need more research, awareness and knowledge that it is a variable condition, and that people should therefore not make assumptions or be complacent.
Andrew Gwynne (Denton and Reddish) (Lab)
It is a pleasure to serve under your chairmanship, Ms Dorries. I congratulate the hon. Member for Stevenage (Stephen McPartland) on securing the debate. I commend the work that he and the all-party group on respiratory health do to raise awareness of these important issues in Parliament.
It cannot be denied that care for respiratory health conditions demands far more attention than it currently receives. Asthma, after all, is one of the most widespread and pernicious conditions around, and takes up a huge amount of resources in our health service. I share the hon. Gentleman’s concerns. We need to ensure the proper use of inhalers. My eldest son is asthmatic. He certainly has regular asthma reviews, and my wife and I, like the hon. Gentleman, try to ensure that such reviews are never missed, because they are so important.
The amount of research time that asthma gets is not proportionate to the scale of the problem, and routine asthma care simply is not up to scratch. The hon. Gentleman made that point well; the fact that he has been receiving pretty much the same treatment for the past 15 years speaks volumes. Respiratory disease is the third biggest killer in the UK, but the risk of conditions such as chronic obstructive pulmonary disease and asthma is perennially underestimated. The rate of deaths from respiratory disease in the UK is around three times that in Estonia and Finland.
Like the hon. and learned Member for North East Hertfordshire (Sir Oliver Heald), I get wheezy at sport. That has nothing to do with being asthmatic; it is more to do with my fitness levels. However, he made an important point that awareness of asthma, in the medical community in particular, is crucial. In 2010, I was very ill. My GP diagnosed asthma and prescribed me inhalers, which made me much worse because I was not asthmatic; I had pneumonia. That highlights the real need for the GP community to understand the specific needs of patients and whether asthma is prevalent, because some medication, as I found out to my detriment, can make people much sicker.
We have not touched on smoking to any degree, but we need to reduce its impact on respiratory health. That is a key factor. Patients need to be supported by clearer links being made between smoking and the start of respiratory disease, and there needs to be easier access to effective smoking cessation services and implementation of appropriate tobacco control measures.
There is, of course, a general awareness of the dangers of smoking. Needless to say, many have accepted the associated risks, but many have not. Two thirds of adult smokers took up smoking as children, so alongside measures to help people to quit smoking, we need to support those who have quit so that they do not relapse. We need to reduce exposure to second-hand smoke, and we should focus on protecting children and helping them not to take up smoking in the first place.
Around 10 million adults in Britain—about 20% of the population—smoke. Every year, smoking causes around 100,000 deaths. It is a major driver of health inequalities. Smoking rates are markedly higher among low income groups. I was pleased to see that the APPG report recommended the urgent implementation of standardised packaging for cigarettes, which Labour wholeheartedly agrees with. An independent report by King’s college London found that it was
“highly likely that standardised packaging would serve to reduce the rate of children taking up smoking”.
I commend the Under-Secretary of State for Health, the hon. Member for Battersea (Jane Ellison), on her commitment to introducing plain packaging; I hope that the Minister present today will join her in the Lobby and encourage his colleagues in the Cabinet and on the Back Benches to support the measure. Christopher Hope of The Daily Telegraph only last week suggested that as many as 100 Conservative MPs planned to vote against the measure. Will the Minister support the measure and, if so, will he encourage his colleagues to do the same?
There are other measures that the Government could implement to reduce rates of smoking. Tackling the problem of toxic second-hand smoke, for instance, is crucial. It can pose terrible challenges to children’s health because of their smaller lungs and faster breathing, and the risks are increased in the confines of a car, for example. It is staggering that every year, second-hand smoke results in about 300,000 GP visits and nearly 10,000 hospital admissions among children.
That is why I was proud of the sterling efforts of my hon. Friend the Member for Liverpool, Wavertree (Luciana Berger) in getting a ban on smoking in cars through Parliament. More than 430,000 children every week are exposed to second-hand smoke in the family car, so when the House of Commons voted overwhelmingly for a ban, it was a great moment. However, the onus is now on the Government to act according to the wishes of the House, and to make the measure law at the earliest opportunity. I call on the Minister to commit to taking that step.
I was pleased by the proposals in the all-party group’s report for more joined-up asthma care. As part of Labour’s 10-year plan for the national health service, we have proposed a joined-up approach to long-term care, with patients being given more say in their care plans and more control over their data, so that that they can make more informed choices. That would be particularly pertinent to conditions such as chronic obstructive pulmonary disease, where a bad flare-up can prove life-threatening. Patients with such conditions should have more say in their care pathways. COPD exacerbations are the second most common cause of emergency hospital admissions, so it is clear how important it is to ensure that people can prevent complications where possible.
Clearly, there is some way to go on cutting rates of smoking and giving people support to stop smoking. However, it is also our responsibility to give people the option to influence their own health care. Hospitals provide advanced care, which often cannot be provided anywhere else, but swift developments have meant that lots of care that could previously be provided only in hospital can now be provided in the community. That is a huge leap forward. On the whole, the most deprived are admitted to hospital more often, not because of a higher propensity to fall ill, but because of the inadequacy of community services.
For example, with forms of COPD, most medical professionals firmly believe that good self-care can provide an incalculable benefit to patients. Those who know exactly how to administer their own long-term care tend to live longer and experience less pain, anxiety and depression. They also enjoy a better quality of life because they are more active and independent.
Sir Oliver Heald
That bears on a point made by my hon. Friend the Member for Stevenage (Stephen McPartland). Does the hon. Gentleman agree that, in many ways, carers have an important role as well? When someone encourages a person to take their medicine on time, or to go to their annual review, that is important. Carers are often unsung.
Andrew Gwynne
I absolutely agree. Carers have an important role in how we integrate health and social care, and we should never underestimate the role they play in providing care for close relatives and friends. The hon. and learned Gentleman is right.
It is only with integrated care that complications can be spotted earlier and hospital admissions potentially avoided. Regular reviews with a patient’s health care team, including information-sharing with other parts of the NHS, can make all the difference. However, there is also a lot to be said for the provision of far more advice and help to those caring for people with COPD.
Labour has said that it will guarantee a single point of contact for people with complex physical and mental health conditions—somebody with the authority to get things done. We will also establish the right to a personalised care plan, developed with the individual and their family, tailored to personal circumstances and not restricted by service boundaries. Patients with conditions such as COPD will also have the right to access peer support and advice from others learning to manage the same condition, which could prove helpful.
I commend the hon. Member for Stevenage on his hard work in advancing the cause of those with respiratory health conditions. Irrespective of the general election outcome, which is largely out of the control of all of us, this issue must be an absolute priority for whomever forms the Government in the next Parliament, and I give the hon. Gentleman a commitment from the Labour party that, if we find ourselves on the Government Benches, it will be.
The Parliamentary Under-Secretary of State for Business, Innovation and Skills (George Freeman)
It is a pleasure to serve under your chairmanship, Ms Dorries.
Let me start by thanking and congratulating my hon. Friend the Member for Stevenage (Stephen McPartland) for securing the debate and highlighting this incredibly important issue. His leadership of the all-party group is to be commended, as is the report it produced under his chairmanship last year. I also acknowledge his successful advocacy of his town of Stevenage as a life science cluster and hub—I can testify to that as the Minister responsible for life sciences.
The all-party group report identified a number of key areas for action, which colleagues have eloquently highlighted this afternoon. They include implementing the outcomes strategy for COPD and asthma; investing in medical research; improving awareness and diagnosis; better case finding; and ensuring that the NHS work force, from top to bottom, have the right skills to treat people with respiratory disease. If time allows, I will attempt to give detailed answers to my hon. Friend’s specific questions. If I am defeated by the clock, perhaps I could write to him. I very much look forward to meeting him in due course to pursue these issues.
Before I turn to those questions, perhaps I could say a few words about the scale of the challenge we face and what the Government are doing to confront it. The seriousness of the challenge posed by respiratory illnesses must not be underestimated, and it will not be shocking news if I say that it is accepted that they have been treated as something of a poor relation in many ways. They affect one in five people in the UK, they are responsible for about 1 million hospital admissions a year and they are the third biggest cause of death in the UK.
As the report from the all-party group’s inquiry into respiratory deaths said, UK death rates from respiratory disease compare poorly with those in other developed countries. In 2010, the UK had a higher rate of respiratory deaths than any other country in the OECD. The Government acknowledge that that situation is simply not acceptable, and we are working hard to improve it. Let me say something about how we are doing that.
The NHS outcomes framework for 2015-16 sets out the Department’s priority areas for the NHS and includes reducing deaths from respiratory disease as a key indicator. It also highlights the need to reduce unplanned hospital admissions due to asthma. In addition, the Government’s mandate to NHS England sets out the requirement for it to improve outcomes in a range of areas. That includes preventing premature deaths from the biggest killers, including respiratory disease, and supporting people with long-term physical and mental health conditions.
We published our “Living Well for Longer” document in April last year. It sets out the health and care system’s ambition to reduce avoidable deaths from the five major causes of death, which include respiratory disease. We set the ambitious target of making England among the best in Europe, to which end there is a lot to be done.
The Department has supported a number of initiatives to help to improve outcomes for people with respiratory disease. In July 2011, we published an outcomes strategy for people with COPD and asthma in England, setting out six high-level objectives to improve outcomes in those areas through high-quality prevention, detection, treatment and care services. The Department also supported the publication of a good practice guide on services for adults with asthma in 2012.
In addition, NICE, for which I have ministerial responsibility, has published quality standards for COPD and asthma, setting out the markers of high-quality, cost-effective care. Their implementation will raise the standard of care that people with such conditions receive.
In the Department of Health, I have responsibility for research. I am proud to say that the National Institute for Health Research has increased funding on these issues by 50% in the last five years, from £16 million in 2009-10 to £24 million in 2013-14. I accept that there is more to be done, but that is a significant start. The NIHR is investing nearly £22 million over five years in three respiratory biomedical research units. The NIHR clinical research network is setting up, and recruiting patients to, nearly 200 trials and studies in respiratory disease. That is some indication of the work that the NIHR and the Government are doing to prioritise this issue.
The Department has collaborated with the national review of asthma deaths, which examined the circumstances surrounding deaths from asthma from 1 February 2012 to 30 January 2013 and reported on its findings in May last year. The lessons learned about the factors that contribute to asthma deaths will inform the NHS about what constitutes good care and encourage the development of appropriate services for people with asthma. NHS England is supporting clinical commissioning groups to improve out-of-hospital treatment for those with asthma by giving doctors more control over the commissioning of asthma services and improving information links between GPs and hospitals.
I am delighted that last week NICE published draft guidelines on the diagnosis and monitoring of asthma. They are out for consultation, and no doubt the all-party group will have comments to make. Roughly 1.2 million adults in the UK may be wrongly receiving treatment for asthma. The guidelines set out the most effective way to diagnose asthma, and how health care professionals can help adults, children and young people control their symptoms better. The draft guidelines stress that to achieve an accurate diagnosis, clinical tests should be used as well as checking for signs and symptoms.
My hon. Friend the Member for Stevenage described how for too long innovation has been lacking in the diagnosis and treatment of the diseases in question. I am delighted about innovations that are coming. The guidelines recommend that health care professionals should ask employed people how their symptoms are affected by work, to check whether they may have occupational asthma. Other guidance is currently in the pipeline, including clinical guidelines on the management of asthma, consultation on which will start in April, and guidance on the diagnosis and management of bronchiolitis in children, which is due to be published in May.
Importantly, NHS Improving Quality, in collaboration with PRIMIS, has developed the GRASP suite of primary care audit tools to help GPs improve the detection and management of COPD, in addition to two other long-term conditions, atrial fibrillation and heart failure. All the GRASP audits, including GRASP-COPD, are funded by NHS IQ, and they run on all clinical systems and are free to use for GP practices in England. Like the other toolkits in the GRASP suite, GRASP-COPD contains a case finder, which helps GPs to identify the number of patients who are at risk of COPD or who have items on their electronic record that suggest possible COPD. It also contains a management tool that compares current management of diagnosed COPD patients with NICE guidelines.
The shadow Minister mentioned smoking, which is an important issue. It is welcome news that the number of smokers is down to its lowest ever level, which means fewer deaths and fewer people living with the disabling consequences of smoking, such as COPD. However, about 8 million people in England still smoke, and it is right that we maintain a commitment to effective tobacco control. Ministers are clear about wanting both to reduce the number of young people who take up smoking and to help those who smoke to quit. That requires action on a range of fronts, nationally and locally, as with so much in the public health arena.
There is no simple, single solution. However, we are taking action. We introduced a package of measures in the Children and Families Act 2014 aimed at protecting young people from tobacco and nicotine addiction and the serious health harms of smoking tobacco. We have also laid regulations to end smoking in private vehicles carrying children, a measure that I am particularly proud of. Subject to parliamentary approval, those regulations will come into force in October. We are changing the law to ban the sale of e-cigarettes to under-18s and have consulted on draft regulations. We will implement the prohibition of proxy purchasing of tobacco by adults on behalf of under-18s, and we will bring forward legislation for the standardised packaging of tobacco products before the end of this Parliament. For the avoidance of doubt, I support that measure, and I shall urge colleagues who care about health to do the same. In 2014-15 Public Health England ran two major campaigns: Stoptober 2014, a nationwide 28-day quit event in October, and the current health harms campaign to prompt attempts at quitting. Public Health England is also running its breathlessness campaign, to raise awareness of the importance of breathlessness and respiratory disease more generally.
My hon. Friend the Member for Stevenage raised several questions, which I want to address. I particularly want to pay tribute to Neil from Norwich, whose story he shared with us, including the extent of his suffering with COPD and asthma. My hon. Friend the Member for South East Cornwall (Sheryll Murray) mentioned the importance of wider allergy risk, and I am delighted to say that I recently visited a centre of excellence at Addenbrooke’s in Cambridge, which is pioneering a new method for detecting and treating allergies. It is an area of immunotherapy in which this country leads. My hon. and learned Friend the Member for North East Hertfordshire (Sir Oliver Heald) and the hon. Member for Cheadle (Mark Hunter) made important observations about that.
My hon. Friend the Member for Stevenage asked about the importance of a national clinical audit. I could not agree more about the importance of properly measuring and tracking performance. He knows that I am passionate about doing that across the system. NHS England is considering it in this area, among several potential new areas. I will highlight its importance in Parliament, along with the Under-Secretary of State for Health, my hon. Friend the Member for Battersea (Jane Ellison), who is responsible for public health, and I urge the all-party group to do the same, through our offices and independently.
I have provided some answers to the questions that my hon. Friend the Member for Stevenage asked about research funding. We have increased the funding by 50% in this Parliament. However, I urge him to raise the matter directly with the National Institute for Health Research, and to continue campaigning in Parliament.
We support the work of the European Asthma Research and Innovation Partnership, and although it is clearly a matter for the competence of the EU, I assure my hon. Friend that the Public Health Minister and I, and the Department, will do anything we can to support the application. As for the creation of a world-class asthma review, NHS England is currently working to ensure that everyone with a long-term condition has a personalised care plan and that treatment for asthma and COPD improves. The Public Health Minister and I will make clear the levels of parliamentary support for that, following this debate.
Finally, my hon. Friend asked whether we could include lung function in the NHS health check for those over 40. Requests for such additional content will be considered by the NHS health check’s expert scientific and clinical advisory panel. I will happily make representations after the debate. I am sure hon. Members know that the Public Health Minister tenaciously advocates pursuing public health measures such as those on respiratory disease, including in the Tea Room, and she will take the matter seriously.
I will conclude, Ms Dorries, within the time that you mentioned, by paying tribute to my hon. Friend the Member for Stevenage. On this issue, as well as on other life sciences issues, he has brought together the views of Members of different parties. Ministers will take the points that have been made, and we will do all that we can in the short time available in this Parliament to ensure that they are properly addressed by the relevant agencies.
Housing Targets (Pudsey)
(9 years, 10 months ago)
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Stuart Andrew (Pudsey) (Con)
It is a pleasure to serve under your chairmanship, Ms Dorries. I am grateful to have secured this debate, which is very important for my constituents. All hon. Members think their constituency is unique and special, as I certainly do. The Pudsey constituency is made up of many individual towns and villages that have a history dating back centuries. All have their own unique identity and are blessed with being close to one of the busiest and most successful cities in the north—Leeds—and being a stone’s throw from the beautiful Yorkshire dales countryside. What makes living in Pudsey, Horsforth and Aireborough enjoyable is the countryside that acts as the natural green lungs between the communities, helping to preserve their real sense of identity.
Every part of the constituency, however, has seen significant change over the past 15 years. Where once stood mills and factories, we now have thousands of new houses. As a consequence, the issue of planning has always been high in the minds of local people. All those extra houses have brought real problems: roads such as the A65 and the ring road have become notoriously congested; schools have such high demand that it is difficult for some parents to get their children into their local school; and doctors’ surgeries have got busier and busier.
Philip Davies (Shipley) (Con)
My hon. Friend has been a persistent campaigner on this subject for his constituents, for which I commend him. With regard to the A65 and the schools in his constituency, does he agree that the proposed developments in Menston right on the edge of his constituency, which will be a disaster for that village, will also have a massive negative effect on the A65 that his constituents use and on local schools? Children living in those developments would go to Guiseley school.
Stuart Andrew
My hon. Friend is right. I am trying to get across that these issues affect not only my constituency; planning applications in his constituency will also have a severe impact.
Just as we thought that things could not get any worse, we are now facing a new onslaught. Like many councils across the country, Leeds city council is currently developing its local plan. The core strategy sets out the council’s housing target. To my amazement and that of my constituents, the council has set the target at a staggering 70,000 houses during the next 16 years. In doing so, the Labour-run council has all but adopted the housing figures from the now-defunct regional spatial strategy, which is an unacceptable prospect for me and my constituents. As a base for that target, the council has used Office for National Statistics population growth projections from 2008. Those data are clearly out of date and inaccurate. More recent data, such as the census, show that growth has been some 43% less than predicted, which presents the first anomaly in the target.
Additionally, the council has based housing numbers on a large explosion of jobs in Leeds, which is good news. However, the council predicts that all the people who fill those jobs will need housing in Leeds, which, in an age of commuting, is clearly nonsense. Currently, only 66% of people who work in Leeds actually live there. Why else would Leeds railway station be one of the nation’s busiest? And why else would trains arriving at stations just within the city’s border, such as Guiseley, Horsforth and New Pudsey, be so crammed if so many people working in Leeds were not from neighbouring areas?
I attended the core strategy examination with Conservative councillors and community groups to argue that the target was too high and was based on outdated and flawed data. Sadly, our case fell on deaf ears and the target was approved. Since then, I have been warning that such a high target will pose a real threat to our green belt, which we will see, now that the council is seeking to identify the sites it needs for housing, but even I could not have foreseen how bad the threat would be.
On 4 January, the council announced a range of sites across the city that it is to consider for development, and there are sites in every part of my constituency. Shockingly, the majority of sites are in the green belt: fields on Ings lane that separate Guiseley and Menston; fields along Coach road that buffer the border with Bradford; and land in Rawdon along the Southlands estate that abuts important woodland. There are also the fields along the A65 from Rawdon crematorium down to the notorious roundabout at Horsforth, and land off Owlcotes road, Gain lane, and Rodley lane.
I recognise the need for house building, and across the city of Leeds there are masses of brownfield sites that need regenerating, particularly in the centre. An ambitious plan was proposed by Leeds sustainable development group for the south side of the city to transform old, derelict sites into good housing, schools and a park—in effect, creating a garden city. That is exactly the sort of development we should surely be encouraging, particularly given the excellent transport links, but again that proposal seems to have fallen on deaf ears.
Alec Shelbrooke (Elmet and Rothwell) (Con)
Does my hon. Friend agree that in Leeds, against the backdrop of facts and figures, the Labour-run council has shown scant regard in destroying our constituencies? My constituency of 41,000 houses is now expected to take 12,500 extra houses, and he rightly points out that there are huge swathes of brownfield land that should be used ahead of the green fields and green belt. Is he struck that this is just political menacing at the expense of people’s lives?
Stuart Andrew
I certainly agree. When it was set up, the whole point of the green belt was not just to preserve our natural environment; it was also to encourage regeneration. I am worried that sites in the city centre are being neglected. Worse, at the examination hearing we challenged the developers to be more ambitious and to adopt such an approach with city centre plans, but their response was simply, “It is not viable.” Is that an acceptable excuse? Are we instead to destroy our green belt and to let such brownfield sites fester, just because the developers say so?
The usual accusation of nimbyism will be bandied about, but that is most unfair. As I said at the start, we have seen every bit of every brownfield site in my constituency used: the High Royds hospital site; the Silver Cross site; the Springhead mills site; the gasworks in Yeadon; the Brook Crompton site; the electricity site; the Cornmill estate in Horsforth; the Broom Mills site in Farsley; the Newlands estate at Farsley Celtic; and the Waterloo road and Cemetery road developments in Pudsey. Those are just a few of the developments, and more are being built or planned. Some 550 houses have been proposed for the Riverside and Clariant sites in Horsforth. Our community has had to cope with the effects of the building of thousands of homes, so this is not nimbyism; it is about wanting sustainable development. Because of the use of all those brownfield sites, in many areas all we have left is the green belt, and building on that is simply not on.
Of course house builders want these sites—they are easier to build on and they are often in areas where the house builders will make the most profit—but the green belt in this area is special. We are not talking about scrappy bits of land; the green belt forms part of what is special and unique in our area—the rural fringe of a city that sits on the borderlands between the south Pennines and the dales, as we saw so effectively during the Tour de France. Green belt sites are important green lungs between our communities that help to keep the identity of those communities. They are used by walkers, horse riders, mountain bikers and farmers, and of course they are important for wildlife and heritage: bats, barn owls, deer, woodpeckers and historical medieval crofts and tofts
I have real fears, and members of the community are rightly angry. They have accepted brownfield development, and they now fear losing the green belt. In Aireborough alone there will be a further 1,600 houses, 79% of which will be on the green belt. A common complaint that I hear from residents is that they feel that planning is something that happens to them, but they have decided to take advantage of the new opportunities that have arisen. Organisations such as Aireborough neighbourhood forum, Rawdon parish council and Horsforth town council are working incredibly hard to develop considered plans that make the most of what we have, encouraging enterprise and building on the history of entrepreneurship that is the legacy of our area’s past. However, Leeds city council is throwing that away as it steams ahead with its ridiculous housing target, which is among the highest in the country and poses a threat to the unique nature of our area.
A complaint from many local bodies is that they are not being listened to. They feel that whatever they say is ignored, which causes more frustration, as the targets are also dictating the development of proposed conservation areas. In Nether Yeadon, the area proposed has been reduced from what independent specialists such as English Heritage suggested, because the site allocation is dictating the designated area. Surely it should be the other way around.
I pay tribute to all the residents who have engaged in the process: John Davies and Jackie Schmelt in Rawdon; Nigel Gill and the residents in Yeadon; Jennifer Kirkby, who has been working with the Aireborough neighbourhood forum; Clive Woods and David Ingham of the Civic Society; the Horsforth campaigners; the Farsley residents action group, which is fighting to protect Kirklees Knoll; Briony Spandler and Martin Fincham, who are working hard in Rawdon.
I have some questions for my hon. Friend the Minister. I have heard time and again that building on green- belt land should be allowed only in exceptional circumstances. My constituents want to know what constitutes exceptional circumstances. Is meeting a housing target an exceptional circumstance? If not, where is that clearly stated, so that we can present our arguments? How can neighbourhood plans be developed when the council plan is at odds with local views? How does that fit in with localism? How can he reassure my constituents, who have put in hours of work, that they are not wasting their time?
The green belt methodology has five criteria: checking unrestricted sprawl, preventing the merging of towns, safeguarding the countryside and preventing encroachment, preserving character and assisting in regeneration by recycling derelict land.
Jason McCartney (Colne Valley) (Con)
The picture that my hon. Friend paints of his area is repeated across west Yorkshire. As he knows, we too have a Labour-run council in Kirklees that is going against local wishes and not listening to local people. Localism is not working in our areas.
I agree with my hon. Friend on the brownfield-first policy. I know how much time he spends knocking on doors in his constituency and meeting local people. I find that there are many empty properties that could be redeveloped and brought back into use as family homes in the middle of communities. We need to work on that side of things and use existing properties for local people.
Stuart Andrew
My hon. Friend is absolutely right. The last time I looked at the figures on the number of empty homes in Leeds city alone, it added up to around 14,000. If we add the 20,000 or so planning permissions that have been granted, that is more than 30,000 opportunities to create properties for people, so let us get that system right before we start demolishing our green belt.
I have outlined the five criteria in the green belt methodology, but in the Leeds city council site allocation, item 5—the crucial bit about assisting in regeneration by recycling land—seems to have been removed. The reason cited is that it is in the core strategy. Is that right and proper? It seems very convenient.
We have also heard lots from the Government about the need for infrastructure. Improvements are being made to notorious roundabouts in the constituency, and new railway stations are being built, but those are solutions to problems we are facing now as a result of building over the past 15 years. Any further development will make those problems return. What does the Minister consider to be adequate infrastructure, and should that not be in place before we start building new houses?
Philip Davies
I am sorry to interrupt my hon. Friend’s flow, but does he agree that we are in a ludicrous situation? His local authority and mine are next door to each other, wanting to build more and more houses in our constituency. At the same time, the west Yorkshire combined authority is putting all the infrastructure spending into the Labour heartlands, starving our areas of the infrastructure that they need to support the housing that it wants to impose on us.
Stuart Andrew
I could not agree more. Anybody who travels along roads in my constituency or my hon. Friend’s will know how horribly congested they are. The A65 is probably one of the most notorious in the country. That is a result of all the housing built before. If the plan goes ahead and all that green belt is lost, the situation will get much worse.
Should not the guidance on how to determine housing need in an area be more detailed in order to stop rogue targets? Should it not be clear so that we do not have different sorts of target all over the country? They should be based not on aspirational demand but on realistic need.
I could talk for a lot longer; I emphasise that I have merely scratched the surface. I have not touched on the fact that we face a double whammy from the Bradford city council targets that will be announced. However, I want to relay to Members the anger and frustration over the fear that such areas are in danger of losing their identity. We need sustainable and realistic housing targets and regeneration decided by planning, not developers. If we had those things, we would be able to preserve the green and beautiful countryside of which Leeds used to be so proud in calling itself the green city. I ask my hon. Friend the Minister to help me and my constituents to stop the destruction and prevent, as Briony Spandler put it so well, our green belt from being turned into grey belt.
The Minister of State, Department for Communities and Local Government (Brandon Lewis)
It is a pleasure to serve under your chairmanship, Ms Dorries. I congratulate my hon. Friend the Member for Pudsey (Stuart Andrew) on securing this debate and outlining some key issues for his constituency. I know that he has fought hard on them; he has lobbied me heavily and invited me to his constituency. I was pleased to meet some of the residents whom he mentioned.
I appreciate my hon. Friend’s concerns about the high housing requirement in the Leeds core strategy. I know that the issue is of considerable importance to him and the local communities that he represents, and it is a subject that we have met to discuss. I am acutely conscious of the impact that planning decisions have on local communities and our wider overall environment, as well as on the investment and growth that our economy needs. That is especially true of housing. It is important not only that we deliver the houses that this country so desperately needs but that they are designed to a high quality and, as hon. Friends have outlined, put in the right places.
As my hon. Friend will appreciate, given Ministers’ quasi-judicial role in the planning system, I cannot comment on specific proposals or plans. None the less, he has raised some important issues relating to the Government’s approach and reforms, and to what is going on locally in Leeds. An up-to-date local plan, prepared through extensive public consultation, sets the framework in which decisions are taken, whether locally by the planning authority or at appeal.
I am aware of my hon. Friend’s concerns about the level of development planned for in Leeds city council’s local plan. Plan making is always challenging, as it involves difficult decisions about how an area is likely to, should and can develop in the future. Local authorities rightly have the power to make such decisions. My hon. Friend the Member for Colne Valley (Jason McCartney) said—if I remember his words correctly—that his local Labour council is just not listening. Fortunately for our democratic system, residents can do something about that when the time comes. Local plans do far more than set housing numbers; they establish areas that it is necessary to protect and set out how development will be supported by appropriate infrastructure.
Alec Shelbrooke
One problem faced by my constituency is that the Labour-run council has decided to play games. Rather than putting the 5,000 houses required in just one area, where they can be built with proper infrastructure, it is giving us death by a thousand cuts by building only 200 or 300 houses in each village. Each village will eventually join up, but absolutely no infrastructure will have been added. I urge the Minister to look closely at that. If councils are allowed to get away with that, our communities and infrastructure will be absolutely destroyed.
Brandon Lewis
I hear what my hon. Friend is saying, and that is one of the reasons why I am keen to move forward and get areas to do more work and develop more neighbourhood plans. Those plans have been admirably championed by my hon. Friends, because they enable local communities to make decisions about infrastructure. Infrastructure is potentially an environmental constraint, and local authorities should look at it to ensure that their housing delivery is appropriate when considering the local plan and planning applications. I will return to that point in a moment.
The national planning policy framework is clear that the purpose of planning is to deliver sustainable development, not development at any cost or anywhere. The framework was introduced after the abolition of the unpopular, top-down regional strategies. It sets out a clear approach to enable local planning authorities to determine the overall housing requirement for their area. Although I appreciate that the housing need in Leeds is still high, Leeds city council’s plans aim to deliver 3,660 homes by 2017, in comparison to the regional strategy’s target of 4,300.
I fully appreciate the concerns of my hon. Friend the Member for Pudsey about the housing data on which the Leeds core strategy is based. As he rightly said, the first step is for local planning authorities to prepare a strategic housing market assessment to assess their full housing needs, and to work with neighbouring authorities where housing market areas cross administrative boundaries. That assessment should be based on facts and unbiased evidence, and it should be unfettered by policy. It should also identify the scale and mix of housing and the range of tenures that the local population is likely to need over the plan period.
I fully acknowledge the concern that Leeds city council based its assessment on the 2008 household projection figures, rather than the lower 2012 projections, which were based on the 2011 census findings. Furthermore, on examination, the inspector recognised that concern and others expressed about the council’s approach, so they inserted a requirement for the local authority to monitor evidence regarding housing need. They agreed to a lower housing requirement for the first years of the plan—the number will be stepped up in later years—to enable people to keep an eye on the plan. My Department will publish updated household projection figures shortly, which may influence future housing need.
Stuart Andrew
That is true, but the figure is going up to 4,500 new houses a year in years 3, 4 and 5. There is real concern that at that point, developers may have put in planning applications that will release those sites, and it will be too late. Does the Minister agree that we need an early review of the housing targets in Leeds?
Brandon Lewis
It is difficult for me to comment on a particular local plan. More generally, if there is clear evidence that things are changing in an area, it would be appropriate and sensible for the local authority to conduct an early review. That is as far as I can go.
As my hon. Friend said, identifying housing need is only the first step of the process. Once the need has been assessed, the local planning authority must prepare a strategic housing land availability assessment to establish realistic assumptions about the availability, suitability and likely economic viability of the land to meet the identified housing need over the plan period. It is expected to take into account the policies of the framework, including the environmental constraints.
National policy is clear that planning must take into account the different roles and characters of areas, and recognise the intrinsic character and beauty of the countryside. Policy also states that to promote sustainable development in rural areas, houses should be located where they will enhance or maintain the vitality of rural communities. As my hon. Friend and others have said, and as I know from my visit to his constituency, much of the countryside is rightly loved and cherished by local communities.
The green belt is a legitimate constraint on development. It is listed as an environmental constraint within the national planning policy framework. That answers my hon. Friend’s question about whether a housing target is a special circumstance for developing on the green belt. The Government attach the highest importance to protecting our green belt. The new guidance that we published in October re-emphasises that importance. We are clear that green belt boundaries should be established in local plans and should be altered only in exceptional circumstances, using the local plan process of proper consultation and independent examination. If Leeds city council undertakes a green belt review, it will need to present robust evidence to the planning inspector and not come unstuck at examination for not doing the proper background work, as did Ashfield district council and Solihull metropolitan borough council.
Our protection of the green belt also extends to planning decisions. Most types of new buildings are inappropriate for green belt land and are, by definition, harmful to it. Such developments should not be approved except in special circumstances. Each planning case has unique facts and a unique context, and it must be determined on its own merits, so we cannot create a list of special circumstances. However, our planning guidance makes it clear that unmet housing need, including need for Traveller sites, is unlikely to outweigh harm to the green belt.
I wholeheartedly agree with my hon. Friends that timely and robust infrastructure provision is vital to delivering sustainable development. Local authorities must focus on that issue. Furthermore, the cumulative impact of development and the need for infrastructure to support development are material considerations in deciding whether individual applications for development are appropriate.
Alec Shelbrooke
My hon. Friend the Minister has expressed the problems that my constituency faces in a nutshell. Effectively, by looking at green fields rather than the green belt, Leeds city council is going to double the size of every village in my constituency and join them up. We need a special circumstance to allow us to redistribute the green belt around those villages to maintain their unique identity. That is where Leeds city council is failing.
Brandon Lewis
My hon. Friend puts it succinctly, and I am sure that his residents will be hanging on those words. Leeds city council has a duty to do what is right for its area, and it should be listening to its residents to ensure that it protects the special environment where they live and which they enjoy.
When I am out visiting communities and speaking to constituents, I hear widespread support for the need to provide more housing. That sentiment has been expressed in this debate. However, that support is often swiftly followed by concerns about where the houses will be built, and understandably so. We love our countryside. The Government have therefore handed local councils the responsibility for planning to meet the local needs, but meeting our housing goals cannot justify approving the wrong development in the wrong location.
My hon. Friend the Member for Pudsey and my other hon. Friends have expressed their frustration about the fact that Leeds city council is reviewing green belt boundaries to meet local housing needs. I am sure that my hon. Friend and his constituents will continue to make strong representations to the council and will express their views about where new housing should be, as the site allocations document is prepared. I know that my hon. Friends will do that loudly, clearly and correctly.
The Government expect councils to utilise brownfield sites, and we aim for 90% of those sites to be developed by 2020. We are putting in hundreds of millions of pounds to fund their development. We are making it clear to councils that we expect them to develop brownfield sites first and protect our country’s green belt.
Time Stamps (Foreign Exchange)
(9 years, 10 months ago)
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Austin Mitchell (Great Grimsby) (Lab)
I am most grateful for the extra three minutes, Ms Dorries.
I am grateful for the opportunity to raise the important issue of the time-stamping of all customer transactions in the foreign exchange markets. Time-stamping would prevent points from being skimmed off for the profit of the bank or the dealers, which is robbing customers of millions of pounds every year. In other words, it is facilitating theft. We must time-stamp foreign exchange transactions so that the rate at which the contract was made can be authenticated.
I first came across this issue a quarter of a century ago—it seems a long time ago—when a young trader came to me and said that dealers at the bank he worked for were skimming off points on trades on his account for their own profit. That, he thought, was a disastrous, dangerous practice, and amounted to theft from his clients’ accounts. He raised the issue as a whistleblower, and was fired in consequence. He first took the issue to the Securities and Futures Authority—a precursor to the FCA in the alphabet soup of authorities that regulate the financial industry in this country. In a letter to him on 4 September 1991, it said:
“Our own enquiries have confirmed the correctness of the view expressed by Mr Souliotis”—
that is the dealer—
“that although the opportunities for such malpractice appear to be many, the way in which the market operates and the audit trails…make the detection of such abuses altogether more difficult. Our enquiries continue however…To this end, we remain in discussion with the Bank of England.”
The buck passed to the Bank of England, and there it stopped and has remained stopped for 25 years. All attempts to end point skimming by imposing date stamps have been stopped by the Bank of England. Why? What it is doing I do not know, but it has effectively been facilitating theft and creating an atmosphere in which theft is easy and possible, and appears to be sanctioned.
I took the dealer, Mr Souliotis, to see Eddie George, who was then the deputy governor of the Bank of England. Mr George said several things. First, he said that the Bank had conducted a full inquiry. Secondly, he said that point skimming was not happening and the Bank could not find evidence of it. Thirdly, he said that banks as a whole would be too anxious to preserve their reputations to allow such a practice to go on—they are their own best guardians, in other words. Eddie George was wrong on all three counts.
When I took up the issue again under the previous Government, I looked into the inquiry done by Eddie George. The then Governor, Mervyn King, wrote to me on 26 August 2012 to say that the Bank’s investigation into the allegations had not taken place. He said that all the Bank did was ask the American Express bank—for it was they—to investigate itself, which it had. Not surprisingly, the American Express bank came up smelling of roses. Its reply to its self-investigation was, “No such thing has happened. What a terrible thought!” Mervyn King told me that the Bank had not conducted any interviews with any traders from the American Express bank.
After my meeting with Eddie George, I raised the issue in an Adjournment debate in the House. The then Economic Secretary to the Treasury, Anthony Nelson, while denying the accusations, told me after the debate that the Treasury knew the practice went on, but could not produce any evidence on the scale of it or who was doing it. I want to help them produce that evidence of point skimming off clients’ accounts by making date stamps a requirement.
That was where the matter rested, 25 years ago; the bank denied the thefts, the Treasury could not find evidence and the practice was apparently condoned. It has certainly continued since that time; it has come to the surface in the United States. The practices in America are much the same as ours. The two markets are similar and the traders are behaving in the same kind of fashion. The same practices go on in both foreign exchange markets.
The first piece of evidence from the United States is that in 2002, the Federal Bureau of Investigation conducted an undercover operation—a sting, in other words—called “Wooden Nickel”. The US attorney for Manhattan, James Comey, who is now the head of the FBI, uncovered in that investigation rigged currency trades in some of the best of the Wall street banks—the biggest banks. The operation led to 47 indictments, most of which led to convictions. Mr Comey said that
“a troubling thing was that similar rigged trading had been defrauding banks for as long as 20 years.”
I could have told him that.
The second piece of evidence from the States came in 2011, when the state employees’ pension fund in Virginia began a billion-dollar lawsuit against the Bank of New York Mellon, alleging overcharging on foreign exchange transactions for the pension funds. That overcharging included a charge of $135,000 on a $12.5 million trade. The proper rate would have been $6,250. They were given a fake rate and there was no possibility of chasing that up, because there were no time stamps on the transaction. The lawsuit went on.
With that evidence, I thought it necessary to raise the matter again in this country. I went back to what is now the FCA and spoke to Clive Adamson, the director of supervision. As a man from a banking background, he should well know what was going on; he was accustomed to doing banks’ public relations. The FCA told me:
“We are not aware of any evidence to suggest that mispricing of non-negotiated FX transactions is taking place in the UK.”
That was after the American evidence and despite the fact that foreign exchange trading works exactly the same way in the UK and the US. It is a huge market in the United States, with $5 trillion of exchange transactions daily, but the FCA denied the possibility that the same practices could occur here. On 18 March 2014, I took the issue again to the FCA, and Adamson’s view that it was not going on here was unchanged.
On 18 June 2014, with my hon. Friend the Member for Leeds East (Mr Mudie), I met Paul Fisher, the Bank of England’s executive director of markets and co-chair of the sub-group of the G20’s Financial Stability Board, which is looking at structural reform of the foreign exchange markets. We were told that time stamps are not a priority for the Bank of England or market participants. Presumably, the market participants that were consulted and said that time stamps are not a priority were the banks that have been so busy rigging foreign exchange rates that they have been fined more than £2 billion for rigging processes. The banks are obviously trustworthy witnesses on this account when they say, “No, this is not going on. Time-stamping is not necessary.” Those who were not consulted were the pensioners whose funds have been ripped off by this practice of skimming off points on trades that cannot be audited, because no one knows what time they took place. The Bank of England did not speak to pensioners or anyone else who had been ripped off. It seems to have no concern to protect pensioners either. The statement that this practice was not happening in the UK and was not a priority for the Bank of England is total rubbish and untrue.
Time stamps on trades allow auditors to compare the prevailing prices to the price in the trade when it was made. Time stamps allow the customer to know that he is getting the proper rate, because he can check the prevailing rate at the time. A time stamp allows someone to know whether a fair price has been applied to a specific trade and whether it has been done properly for the customer. It is an important and easy reform. It is easy to introduce; there is no difficulty about it. When banks trade foreign currencies among themselves—they are called interbank transactions—they use time stamps. They do not trust themselves, so they use time stamps, but they do not use time stamps when they are trading for customers, so they can rip the customers off. That is what this debate is about.
When shares are bought and sold, the transaction is time-stamped. In the United States, as a result of an amendment to the Government Securities Act in 1993, a time stamp must be used when Government securities are bought and sold. I do not know what the case is with gilts here, but trades in gilts should certainly be time-stamped. When someone buys a Starbucks coffee, it is time-stamped, yet they cannot time-stamp foreign exchange transactions for the benefit and protection of the customer.
Why is the financial industry exempt from time stamps on its foreign currency transactions for clients and why is the Bank of England supporting it? The practice is bad and disastrous. Why are customers left exposed to what amounts to the virtually invisible mispricing of trades that allows points to be skimmed off and makes thefts so easy? Why, when it is so easy to impose time stamps and therefore to know what is happening? It mystifies me. I cannot see the motive behind it and I cannot see the reason for resisting time-stamping for the two decades for which people have been making the argument for it.
Interestingly, Liam Vaughan, a Bloomberg journalist, has shown how things operate without time stamps. He was told by two former employees of Goldman Sachs who were on its foreign exchange alpha team in New York that when a salesman receives an order from a customer, often by e-mail, he executes it and waits to see whether the market changes. If the market goes up, he charges at the higher rate and keeps the difference between the price that was actually paid and the rate charged to the customer; in other words, he skims off. The former employees said that that can make as much as 30 pips on a €10 million trade into dollars—that is, 0.3% of $13.6 million goes to the traders in points skimmed off, unless there are time stamps to show at what time the trade was done.
One can imagine the consequences of very few points—just a few pips—being skimmed off on lots of trade in a market worth $5 trillion a day in the United States. It is no wonder that the dealers do not want to time-stamp the transactions, but it is annoying that the Bank of England—the guardian of probity and regulator of markets—is stalling on the issue and talking of “ongoing reviews” that have been ongoing for 20 years and achieved nothing. Why is the Bank of England doing nothing? It is negligent and shameful that it should behave in this fashion.
I am not interested in prosecuting the lovely banks; I love the banks. I am not proposing that they should be prosecuted for past crimes, because official inaction has given them the green light to commit this kind of theft. However, I want time stamps so that we will have an audit trail and point skimming will be so risky that they will stop doing it. We are now considering, nationally and internationally, reforms of the foreign exchange markets, and the G20 Financial Stability Board is considering the issue. It is essential that, as part of that consideration, we put time stamps at the head of the agenda and stir the Bank of England out of its lethargy. I hope that the Minister will not ask us to wait and see, because my plea is that we should get on with it immediately.
On 8 September 1991, Clifford Smout, who was head of banking supervision policy for the Bank of England, wrote of foreign exchange skimming:
“The existence of such abuses is difficult to prove in a fast moving area such as the foreign exchange market”.
But I am providing a way in which they can prevent it and get convictions; why are they taking so long to do it? My plea is for us to get on with it: let us have time-stamping on all foreign exchange transactions for clients of the banks.
The Economic Secretary to the Treasury (Andrea Leadsom)
It is a pleasure to serve under your chairmanship, Ms Dorries. I congratulate the hon. Member for Great Grimsby (Austin Mitchell) on securing this debate on the incredibly important subject of foreign exchange manipulation. He will have been as disgusted as I was to learn about the benchmark rigging that has gone on in financial markets and the various tales of banking misconduct that have shocked and disgusted everyone. I assure him that I do not think that the Treasury or the Bank of England are naive in their determination to weed out bad practice.
By way of background, the foreign exchange market underpins the global financial system. It enables international trade in goods and services, cross-border investment and monetary policy, so it is critical to ensure that it is well functioning and fair for the benefit of countries, businesses and consumers. As the hon. Gentleman pointed out, the UK is the largest single market for foreign exchange trading. In 2013, more than 40% of global foreign exchange trading took place in the UK, supporting an enormous number of jobs and enormous investment in this country.
The foreign exchange market is one of the most deep and liquid markets. It has contributed to efficient wholesale markets in which the turnover can be as high as $2 trillion a day in the UK alone. However, it is vital that all end users can benefit from the market, so we welcome the growth of specialist foreign exchange providers that compete with existing banks for the foreign exchange business of smaller businesses and retail consumers.
On tackling market misconduct, we expect firms operating in foreign exchange markets to adhere to the highest standards of conduct. Where they do not do so, we will take action to prevent and punish bad behaviour, as shown by the recent enforcement actions taken by the Financial Conduct Authority against five banks. The attempts by some banks to manipulate certain foreign exchange benchmarks were totally unacceptable and disgraceful. The Government and the regulators have taken tough action to punish such behaviour and prevent such scandals from happening in the future. The hon. Gentleman will know that the Serious Fraud Office has opened criminal investigations into certain types of market misconduct, and those investigations are ongoing.
First, the Government established the FCA with a specific remit of focusing on the conduct of our financial sector. Secondly, we have laid before Parliament a statutory instrument to extend regulation to the key foreign exchange benchmark: the WM/Reuters London 4 pm closing spot rate. The manipulation of that and six further financial benchmarks will be a criminal offence from 1 April 2015. Thirdly, we have established the fair and effective markets review to conduct a comprehensive and forward-looking assessment of how wholesale financial markets operate, to help to restore trust in those markets in the wake of a number of recent high-profile abuses, and to influence the international debate on trading practices. The review will examine in particular how the wholesale fixed-income, currency and commodity financial markets operate. It will provide recommendations on how the fairness and effectiveness of such markets can be improved.
The Government recognise that market structure and transparency play an important role in making markets more effective. Although the foreign exchange market is predominately an over-the-counter market in which transactions occur bilaterally between market participants, over the past 10 years it has been at the forefront of the electronic trading revolution. The electronic trading side now accounts for more than 60% of foreign exchange trading in spot markets, which has brought significant improvements in efficiency and transparency to market participants.
The use of electronic trading is most prevalent in the wholesale market, however, so it is right for us to consider whether the process of technological development has gone far enough to improve the fairness and effectiveness of markets, or whether we need to take further steps. The principle that how a transaction will be priced should be understood by market participants at the time when they enter into the transaction should always apply.
To deal specifically with time-stamping, the hon. Gentleman argued that if firms were required to provide time stamps for foreign exchange transactions that do not occur at the time of any agreement to enter into such a transaction, it could bring additional transparency to the market. He is of course right that time-stamping would prove the point at which the trade was done. High-quality record keeping is integral to how all financial services firms, including foreign exchange dealers, should organise themselves and operate, so I agree that it is important for firms to keep appropriate records of transactions with clients.
Time-stamping, however, presents some practical challenges. First, the key one is that market participants can use the time stamp only if they have access to a data feed of foreign exchange market prices, but such reference data are not publicly available other than at significant cost. Furthermore, as transactions are undertaken bilaterally, there is no central market for all foreign exchange transactions, so any consolidated tape of transactions would capture only a part of the market. The price of such transactions would also not necessarily be directly comparable. In foreign exchange, the price of each transaction may take into account a range of factors specific to that transaction, such as assessments of creditworthiness.
Secondly, when the foreign exchange dealer acted as agent, market participants would need to understand how the transaction had been priced to understand whether they were charged accurately. The interbank rate cannot be expected to be available to all market participants, for example.
Thirdly, when the foreign exchange dealer acts as principal, it could be argued that what is more important than a time stamp is access to a range of competitive quotes, which indicates that the issue of time-stamping transactions needs to be considered in the wider context of market structure and competition.
Clearly, the main purpose of a time stamp would be to create an audit trail for a market participant to detect mispricing of foreign exchange transactions. We should be clear, however, that if clients were misled about the pricing of foreign exchange transactions, such an act would be fraudulent.
I will talk a bit more about the fair and effective markets review, which I hope will give the hon. Gentleman some comfort.
Austin Mitchell
I am grateful to the Minister for her reply, but the difficulties that she has posed are not insuperable—they can be overcome. A time stamp is easier with electronic trading than with other forms of trading, but it should be used in all kinds of trades, because if there is a time stamp the client has the ability to look at the price range that day. The client might not know the total trading, but he can look at the price range and see what time the transaction was made, so he will know whether he was getting a fair deal and a proper price. That is the important thing—to put the knowledge in the hands of the consumer. The difficulties can easily be got around with a will to do so. The question is, why has the Bank of England been allowed to drag its feet on the issue for so long? Why not put that in straight away?
Andrea Leadsom
All I can do is repeat what I said, which is that the interbank price is one price, but that will not be the price for a retail investor, such as someone going on holiday or a small business. If we time-stamp a transaction, we will have to have the specific price of that transaction at a given time, and that information is simply not available. For the time stamp to be useful, we would have to know what the market was at that precise time. As the hon. Gentleman pointed out himself, a few basis points make a world of difference to the profits for the trader, so if one were minded to rig the price for a consumer or a business, even a sizeable one, and to commit fraud, even a time stamp need not prevent the fraudulent activity, simply because it would be difficult to pin down what the actual price should have been.
The Government established the fair and effective markets review so that careful analysis of the fixed-income, currency and commodity markets could be undertaken. Part of the review will be to consider whether there should be further regulatory tools available in foreign exchange markets, including whether there is a need for further criminal sanctions. The review will also consider the market structure and whether it can be improved through regulatory intervention or market-led action. Obviously the Government cannot prejudge the outcome of the review, but those conducting it will be well aware of the issues raised by the hon. Gentleman and will be taking his views into account. The Government will consider the recommendations of the review once it reports in June and will provide a response.
In conclusion, the time-stamping of transactions needs to be considered in the context of improving the overall fairness and effectiveness of the foreign exchange market. Foreign exchange markets are by their nature the most global of all the financial markets, so a consistent international approach to their regulation is essential. Where action is warranted, the UK should definitely lead the way in calling for and delivering it. I hope that I have reassured the hon. Gentleman of our commitment to ensure a fair and effective foreign exchange market—one that protects the customer while keeping the UK’s leading position internationally.
Question put and agreed to.
Written Statements
(9 years, 10 months ago)
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Local Government Finance
(9 years, 10 months ago)
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The Parliamentary Under-Secretary of State for Communities and Local Government (Kris Hopkins)
The Government have today laid before the House the “Local Government Finance Report (England) 2015-16” and the “Referendums Relating to Council Tax Increases (Principles) (England) Report 2015-16”. These reports set out for each local authority in England, individual local government finance settlement funding assessments, business rates tariffs and top-ups, the basis of their distributions, and the council tax referendum principles for 2015-16.
Further to my oral statement of 18 December 2014, Official Report, column 1590, a draft of the local government finance report was issued for consultation in December. During the consultation period, which closed on 15 January, Ministers met a number of local authorities and representative groups including the Local Government Association, London Councils, the District Councils Network and the National Association of Local Councils. I also led a phone-in discussion in which over 100 authorities participated. In addition, the consultation received numerous written responses.
Having considered the views of all those who commented on the provisional settlement, we have decided to confirm the proposals for the settlement for 2015-16 as announced. We are confirming our proposal that the council tax referendum principle for 2015-16 will be set at 2%. In addition, we are providing a further £74 million to upper-tier authorities to recognise that councils have asked for additional support, including to help them respond to local welfare needs and to improve social care provision.
Delivering a fair settlement
Every bit of the public sector needs to do its bit to pay off the deficit left by the last Labour Government, including local government which accounts for a quarter of all public spending.
Yet we have aimed to deliver a settlement that is fair to all parts of the country, both north and south, urban and rural, city and shire. There is still significant scope for councils to deliver sensible savings—from more joint working, better procurement, “invest to save” use of reserves, using transparency to find and cut waste, collecting unpaid taxes, tackling fraud, and better property management.
Even with the savings that have been made to date, English local government expects to spend over £115 billion in the current financial year. Net current expenditure by councils—excluding education due to the shift to academy funding—has risen in cash terms under this Government.
With the addition of the extra resources mentioned above, the overall change in local authorities’ spending power in 2015-16 is now -1.7%. When taking into account the funds that we are providing to support local transformation, the overall final reduction is even lower—at 1.5%. Councils facing the highest demand for services continue to receive substantially more funding and we are continuing to ensure that no council will face a loss of more than 6.4% in their spending power in 2015-16—the lowest level in this Parliament.
We have deliberately shifted the emphasis from keeping local authorities dependent on grant, to providing councils with the tools and incentives they need to grow their local economies and promote house building, including through business rates retention. For 2013-14, authorities’ own estimates show that over 90% are expecting a growth in their business rates income, of over £400 million in total.
As well as growing their economies, the best authorities are transforming the way they do business. The Government are supporting them as they do so, achieving real savings and—importantly—improving outcomes for the people who use local services.
We also continue to recognise the challenges faced by rural communities. This Government have a clear commitment to rural areas, and consecutive settlements have helped to address the gap in urban-rural spending power. We expect the gap to continue to close. In the meantime, the settlement confirms another year of additional resources for the most rural authorities to recognise the challenges they face in delivering services. In 2015-16, this grant has increased to £15.5 million.
Supporting the vulnerable
The Government previously consulted on a range of options for how local welfare provision by upper-tier local authorities—that is, London boroughs, metropolitan borough councils, unitary councils and county councils in two-tier areas—should be funded in 2015-16 following its localisation. The Department for Work and Pensions also carried out a review. The Government concluded that local authorities would continue to be able to offer local welfare assistance from within existing budgets for 2015-16, alongside a range of other services, if they judge it a priority in their area.
To assist in identifying how much of their existing funding relates to this, an amount relating to local welfare provision was separately identified in each upper-tier authority’s general grant. This totalled £130 million nationally and was distributed in line with local welfare provision funding in 2014-15. The Government have always been clear that councils should choose how best to support local welfare needs. Therefore this allocation will not be ring-fenced and we will not be placing any new duties, expectations or monitoring requirements on its use.
In response to representations during consultation, we have now decided to allocate an additional £74 million to upper-tier authorities, to assist them in dealing with pressures on local welfare and health and social care. This will further help councils as they develop localised arrangements.
This extra funding is on top of £37 million of additional funding to local authorities for 2014-15 announced last week, so that they can provide additional support packages to get people home as soon as they are ready to leave hospital, and avoid the need for people to go into hospital in the first place. This Government are working to join up local public services and decentralising power and funding to local communities.
Keeping council tax down for hard-working people
We are again providing funding for councils, fire authorities and police and crime commissioners to help freeze their council tax in England. We have now provided freeze funding during all five years of this Parliament. As a result, council tax in England has fallen by 11% in real terms since 2010, when it had more than doubled under the last Labour Government. Indeed, the Labour-run Welsh Government which have refused to fund a council tax freeze from the Barnet consequential payments have seen soaring council tax.
We urge councils to protect taxpayers up and down the country by taking the additional funding on offer for a freeze and help hard-working people with the cost of living. The council tax freeze grant from central Government will be embedded into councils’ baseline funding.
For those which do not freeze, any increase of 2% or more will require a binding referendum of local electorates. Local authorities which want to do so should have the courage of their convictions and seek a mandate for this. It is already the case that a council tax referendum can be held at a reduced cost in 2015-16 when combined with the general election.
We can further announce today that any savings to the consolidated fund as a result of combination of a referendum with the general election will be redirected to councils, so that the cost of a referendum to a local authority is marginal—such as the small costs of printing and counting some extra ballot papers. This demolishes the argument floated by some that holding a local referendum would result in an excessive cost.
Copies of the reports will be available in the Vote Office. We shall be making available supporting technical information online on my Department’s website.
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Low Severity Avian Influenza (Hampshire)
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The Secretary of State for Environment, Food and Rural Affairs (Elizabeth Truss)
The Chief Veterinary Officer has confirmed a case of avian flu in a chicken breeding farm in Hampshire. Tests have confirmed the case as a low severity H7 strain of the disease, a much less severe form than the H5N8 strain found at a Yorkshire duck farm in November; there are no links between the two cases. Initial laboratory results indicate that this is likely to be the H7N7 subtype.
The advice from Public Health England is that the risk to public health is very low, and the Food Standards Agency has said there is no food safety risk for consumers.
To ensure that the disease does not spread, we have taken immediate and robust action. A 1 km poultry movement restriction zone is in place around the premises and the chickens on the premises are to be culled as part of our well established procedures for responding to avian flu.
While we are never complacent about such an important issue, we have a strong track record of controlling and eliminating outbreaks of avian flu in the UK. We are working closely with operational partners, devolved administration colleagues and the industry to deal effectively with this outbreak.
[HCWS244]
Advisory Panel on Public Sector Information
(9 years, 10 months ago)
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The Minister of State, Ministry of Justice (Simon Hughes)
On 27 March 2014, Official Report, column 50WS, I announced the commencement of the triennial review of the Advisory Panel on Public Sector Information (APPSI), an advisory non-departmental public body (NDPB) of the Ministry of Justice.
The review has been undertaken in accordance with the Cabinet Office’s guidance on public bodies and as part of the Government’s commitment to improve and make sure of the best, accountability and effectiveness of public bodies.
I am today publishing the review, which concludes that there is no longer a continuing need for the current non-statutory functions of APPSI. Government are able to seek and receive this advice on the reuse of public sector information on a less formal basis by other bodies which perform similar functions and are not set up as NDPBs. This is supported by the evidence provided in the report.
APPSI’s statutory function has not formed part of the review as it is currently under consideration as part of the Government’s transposition of directive 2013/37/EU on the reuse of public sector information. The directive requires an impartial review body with the ability to make binding decisions and APPSI would be unlikely to meet these requirements. APPSI’s statutory function will be replaced by new redress provisions and will therefore no longer be required.
The triennial review recommends that APPSI ceases to carry out its non-statutory functions and is abolished once its statutory function ceases to exist with transposition of directive 2013/37/EU during 2015.
I am grateful to current and former members of APPSI for their valuable work in advising Government on public sector information and its reuse. APPSI played a key role in contributing to the Government’s approach to public sector information, reuse and Crown copyright. I particularly note the early development of a concept of a national information framework, reflected in the Government’s national information infrastructure, and APPSI’s role in developing an open data glossary on data.gov.uk.
I will place a copy of the review in the Libraries of both Houses.
It is also available online at http://www.parliament.uk/writtenststements.
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Grand Committee
(9 years, 10 months ago)
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Arrangement of Business
(9 years, 10 months ago)
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The Deputy Chairman of Committees (Lord Geddes) (Con)
My Lords, it is now 3.30 pm. It will not surprise your Lordships when I start by saying that if there is a Division in the House, the Committee will adjourn for 10 minutes.
Care and Support (Business Failure) Regulations 2014
(9 years, 10 months ago)
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The Parliamentary Under-Secretary of State, Department of Health (Earl Howe) (Con)
My Lords, I come before the Committee today to introduce the draft affirmative regulations under Part 1 of the Care Act 2014. The regulations before us relate to some of the most important elements of the Care Act, which consolidated 60 years of fragmented legislation into a single modern statute built around the needs and outcomes of a person.
Following Royal Assent for the Care Act in May 2014, the Government published final statutory guidance and laid those regulations subject to the negative procedure before Parliament in October and November, as well as laying these regulations in draft. In keeping with the collaborative approach that we have sought to maintain through the development of these reforms, over the summer the Government conducted an extensive public consultation on the guidance and regulations, including draft versions of the regulations that we will consider today.
The consultation engaged the full spectrum of stakeholders including: people receiving care and support and their carers; social workers and other front-line practitioners; local authority commissioners; social care providers; national representative groups; and NHS bodies. In total, the consultation drew more than 4,000 responses from many different sources. Responses were carefully analysed and, where appropriate, changes were made to regulations.
I will briefly introduce each of the four statutory instruments. I turn first to the Care and Support (Business Failure) Regulations 2014 and the Care and Support (Market Oversight Criteria) Regulations 2014. I will address these together as they form the two pillars of our broader strategy to protect people from provider failure. There is a diverse provider market in adult social care where entry and exit is a regular occurrence. Local authorities are currently able to intervene to meet needs in relatively rare cases where services are closed at short notice and individuals are put at risk—and historically they have done so effectively.
The Care Act places specific duties on local authorities in Wales and England, and their broad equivalents in Northern Ireland, to temporarily step in and meet needs where a provider is no longer able to carry on because of business failure. The business failure regulations set out the meaning of “business failure” generally by reference to different types of insolvency, for example administration and winding up. This approach ensures that people receiving services are protected in the event that their provider enters insolvency, without diluting the core responsibility of providers to deliver care services under normal circumstances.
The social care market includes large care providers, operating across much of England, whose financial failure, were it to happen, would cause local authorities considerable difficulty in carrying out their business failure duties without early warning. One such recent example was in 2011 when Southern Cross, then the largest provider of residential services in England, was threatened with insolvency. Local authorities had no prior warning of its financial position. While few people eventually had to change care home, the Government recognised that the degree of worry for people receiving care and their families was unacceptable.
The Care Act accordingly places new duties on the Care Quality Commission to assess the financial sustainability of certain registered care providers. The CQC will do this by collecting and analysing financial information. The CQC may respond to significant risks identified to the financial sustainability of a provider by requiring it to develop a plan to mitigate any risks identified, or ordering an independent review of the business. Should the CQC be satisfied that a provider is likely to fail, it will provide relevant local authorities with an early warning and the information that they need to prepare adequately to protect the continuity of care for individuals. Where the CQC is not satisfied that the provider is taking all the necessary steps to return to financial health, or it feels that it has not been given the necessary information to assess financial sustainability, it is able to take a range of regulatory actions, up to and including the deregistration of the provider in question.
The Care and Support (Market Oversight Criteria) Regulations set the entry criteria for the CQC’s financial oversight regime. Any provider meeting those criteria will be subject to the CQC’s regulatory activities that I have described. They have been designed to capture those providers that—because they are particularly large, geographically concentrated or operate in a large number of local authority areas—would be “difficult to replace” were they to fail financially. It is important to note that inclusion in the regime is a comment not on the likelihood of failure but rather on the risks that would be posed should the provider get into difficulties.
The Care and Support (Children’s Carers) Regulations 2014 relate to the power in the Act for local authorities to support carers of children in a similar way to that in which they support carers of adults, setting out how the rest of Part 1 of the Act applies in this situation. It is important to note that this power applies only in the limited circumstances where carers of children have received a transition assessment in preparation for beginning to receive support under the adult statute, but the transition has not yet actually taken place.
The broad principle at work will be that adult carers of children are supported under children’s legislation, while adults caring for adults will be supported under the Care Act. This instrument is merely an acknowledgement that some flexibility in this regard may be desirable around the time of transition. The instrument has been carefully drafted to ensure that it does not replicate the support for carers of children under other legislation, so ensuring that there remains a clear division of responsibility. These regulations allow for flexible and personalised approaches to support, without forcing local authorities into unnecessary changes to different, broader policies for carers of children and of adults, which exist for good reasons.
Lastly, the Care and Support (Eligibility Criteria) Regulations 2014 set out the national eligibility criteria for adult care and support and carer support. All local authorities will at a minimum have to meet this threshold and cannot tighten their criteria beyond it, although they will have a power to meet needs that were not considered eligible. The national eligibility threshold has been set at a level where the person’s care and support needs, and their inability to achieve certain outcomes as a result, have or are likely to have a “significant impact on their well-being”. This is intended to have a similar effect to the eligibility level that the vast majority of local authorities operate at present. Together with funding announced in the 2013 spending round, this will allow local authorities to maintain the level of access to care and support when the new system is introduced in April 2015.
Given the critical importance of the eligibility criteria, the Government have been especially careful to ensure that they have taken account of the full views of all relevant stakeholders. The Department of Health carried out an extensive engagement to gather views on an initial version of the regulations from June to December 2013, and engaged the Personal Social Services Research Unit at the London School of Economics to evaluate the draft regulations against current practice. These findings informed the second version of the eligibility regulations that were consulted upon in summer 2014.
Alongside the consultation, the department asked PSSRU to evaluate the second draft of the regulations, working with 27 local authorities to compare the draft regulations with recent cases. We made a number of changes to refine the criteria on the basis of feedback and independent research. We have also worked closely with stakeholders to test the approach. I am confident that the final version before us fulfils the Government’s commitment to replicate the current access to care and support in setting the national criteria.
These regulations are required to meet fully some of the central aims of the Care Act: protecting people from the reality of provider failure and the extreme worry caused by its spectre; providing flexible and appropriate support for carers; and ensuring more consistency in people’s rights to care and support. I commend these statutory instruments to the Committee.
Baroness Wheeler (Lab)
I thank the Minister for his comprehensive introduction to these four important affirmative regulations. As he knows, I also have a take note Motion tabled for next week on the negative regulations on implementing the Care Act. Inevitably, there will be overlaps between today’s debate and next week’s but I hope that we can clear off some of the major issues today. The four SIs cover a number of important issues so, while we were happy to have them taken together to expedite the business of the Committee, I hope that the Committee will bear with me since there are a number of areas to cover in relation to implementation of the Care Act and the individual SIs. I also thank the Minister for the very helpful briefing meetings that he has had with Opposition Front Bench health team members on the regulations. He will know that both the Opposition’s health and local government teams are keeping a close watch on how the Care Act is being implemented, so we were grateful for the time that he took on this.
We believe strongly that this first phase of implementation has to be viewed across both the local government and health departments, and considered in the context of the huge funding pressures on local authorities, with a 40% cut in their funding since this Government took office. The Minister, of course, disputes this figure and others from independent bodies on the scale of local government cuts cross the piece and their devastating knock-on impact on social care. Whether the figures are from the King’s Fund, the Nuffield Trust or Age UK, they all put the scale of cuts to social care budgets in terms of billions of pounds.
Recent figures from the Association of Directors of Adult Social Services, with which the Department of Health has worked closely on the Care Act’s implementation, point to this year being the third year of continuing cash reductions and the fifth of real-terms reductions in spending on social care. It points out that, since 2010, social care spending has fallen by 12% while the number of those looking for support has increased by 14%. Social services departments have been forced to make savings of 26% in their budgets—the equivalent of £3.53 billion over the last four years. Compared to 2009-10, almost 300,000 fewer people over the age of 65 are receiving state-funded care.
On many previous occasions, the Minister has set out the additional funding being made available for Care Act implementation—and, despite the challenges, the recent DH stock-take shows encouraging overall progress in local authorities’ readiness for the phase 1 implementation from April 2015. Like the department, we commend the role of the joint LGA/ADASS/Department of Health programme management office. We fully recognise the scale and extent of the work that has gone into consultation exercises with stakeholders, the drafting of the regulations and guidance and the joint working on implementation with local authorities.
However, the same stock-take also makes clear councils’ continuing concerns about the adequacy of funding in the face of modelling which shows increasing support needs for local authorities around IT, workforce, information advice, carers and market shaping. Workforce capacity is a particular concern. The LGA view is that these aspects of implementation of the 2015-16 reforms may be underfunded by as much as £50 million.
Before moving on to the regulations, perhaps I may refer quickly to the Government’s plans to close down the Independent Living Fund in June 2015. We seek reassurances from the Minister that the funds transferred to local authorities from that fund will continue to be used to provide vital support for the disabled people who currently depend on it to be able to live independently in the community and have the same rights, choices and chances as any other citizen. My understanding is that it will be for individual authorities to make decisions on how the resources from the fund will be applied. Will the Government issue guidance to help protect the thousands of disabled people currently receiving ILF support who are affected by this decision? How will they ensure that the money is not just diverted into helping to fund the Care Act implementation or into general funding support for social care services?
The care and support regulations on the market oversight criteria, the interlinking negative regulation on market oversight information—covered by my take note Motion next week—and the business failure regulations are about trying to prevent the sort of problems witnessed in 2011 with the collapse of Southern Cross Healthcare, as set out by the Minister, by empowering the Care Quality Commission to monitor and obtain financial information from providers to check their financial stability and spot the early warning signs of potential difficulties and failure. The aim is to protect vulnerable people and their families if there is provider failure, to ensure that local councils have both early warning and support to be able to maintain vital continuity of support and to ensure that no one depending on the service will suffer.
Lord Lipsey (Lab)
My Lords, it is a great pleasure to follow my noble friend Lady Wheeler, who has achieved the rare feat of matching the Minister in both her knowledge of the subject and the eloquence with which she expressed it. I shall raise one or two points on just two of today’s regulations. The first is the market oversight criteria regulations—which, in principle, I strongly support. A few alarm bells began to ring in my skull when I saw that the body to be responsible for this is the CQC. My mind drifted back nearly a decade, I suppose, when we were in this Room debating the amalgamation of three regulators, proposed by the then Government, into the CQC. I remember speaking with all the eloquence that I could muster to explain why this was going to be disastrous, and the noble Lord, Lord Darzi, the then Minister, explaining with great eloquence why I was completely wrong. After that, the noble Lord and I would go outside and he would say, “I totally agree with you, David; this is an act of absolute madness”. I am afraid that for years so it proved.
I regard the CQC as on probation. It has new management. David Behan, the chief executive, is a man for whom all of us, I think, have the greatest respect. There are examples in which the CQC is improving its practice but it is still only on probation, which in itself does not provide me with the complete reassurance that I should like. More seriously, it is all very well having market oversight, but you need the resources to do it. I have done a little back-of-the-envelope calculation based on the Explanatory Memorandum, which suggests that the CQC will spend £6,000 per chain monitoring whether it is in financial trouble. Frankly, £6,000 does not buy much of a top accountant’s time. So while I should like to think that the CQC will pick up readily in advance of crises that there are problems, I doubt whether it is resourced to do so. The Minister and the Government should satisfy themselves that this job will be done and is not just a paper exercise so that, if something goes wrong, they can say that they did something about it. In practice, that will not be effective.
It is not entirely accurate to say that the eligibility criteria regulations translate into legislation the present criterion of substantial. Indeed, it has been argued that this is a slightly more liberal definition than the present substantial definition of what creates eligibility. But it is also not wholly inaccurate. I do not have any objection to this. I have read the useful briefing provided by the Care and Support Alliance but I am not convinced that, given the shortage of finance, to which I shall return in a moment, it would make sense to impose a much looser definition of eligibility and substantial, as recommended by Dilnot—particularly in view of the financial situation in social services.
I know that figures get bandied about for ever on this. I chose to take one from the Department of Health’s publication of March 2014 in which it said that spending on adult social services had fallen by 8% in the previous two years. Since the Government say that that is true, it must be true. Incidentally, we are seeing a folly in public finance which deserves to be highlighted. When you ring-fence one bit of public finance or guarantee it in real terms, that leads to more pressure on other forms of public finance. Because healthcare is ring-fenced and maintained in real terms—I am not arguing about whether the numbers are right—social services ends up taking more of the brunt.
Baroness Pitkeathley (Lab)
My Lords, I will speak briefly on two of these regulations: those relating to the eligibility criteria, following on from my noble friend Lord Lipsey, and, first, the children’s carers regulations.
Some noble Lords in the Room will remember, when the Children and Families Bill went through this House, the struggle that we had to get parent carers recognised at all in the legislation. All credit to the Minister for finally recognising that parent carers had rights. However, there is now a serious problem because the regulations that we were promised would be issued along with the regulations under the Care Act have not in fact been issued. We have therefore left local authorities without clarity or direction about how to implement these new rights for parent carers—rights which we won with such difficulty but with eventual recognition from the Minister.
I ask the Minister, as did my noble friend, when the Government intend to publish statutory guidance on the new rights for parent carers under the Children and Families Act, why the statutory guidance was not issued at the same time as the guidance under the Care Act, and what plans they have to support local authorities in implementing the new rights for parent carers and young carers. I also support what my noble friend Lady Wheeler said about those carers who are left high and dry—the carers of disabled children who do not have parental responsibility. They are not covered by either piece of legislation and are left with a rump of rights under the long-outdated Carers (Recognition and Services) Act 1995. We really do need to clear that up.
I turn to the issue of eligibility criteria. As everybody knows, the Care Act creates an equivalent duty on local authorities to meet the care and support needs of adults and carers alike. In doing so, it puts carers of adults on the same legal footing as adults with care needs. This was a hugely significant legal development, giving carers the clearest rights ever to support in their caring role, and it is greatly welcomed. However, the Government’s decision to set the minimum threshold at the level at which local authorities are already providing support is a cause for huge concern. As we heard from my noble friend, the historic underfunding of social care has left thousands of older and disabled people without access to the care that they need, and has heaped pressure on to family carers, who are increasingly stepping in to provide care at great personal, societal and economic cost.
ADASS reports that spending on social care has been reduced by some 26% in the past four years. It is absolutely vital that a sustainable level of funding is put in place for social care, setting the funding mechanisms which will deliver the amount of money that we need to tackle the existing gap between need and supply and to keep pace with growing demand—and the demand is growing. The number of carers who care for 50 hours or more per week is rising faster than the number of the general carer population—Carers UK estimates that there has been an increase of 25% over the past 10 years. Despite the ongoing rise in the number of carers in the UK, the number receiving carers’ assessments and carer services from their local authorities is falling. I fear that that situation will only get worse. Carers are going without food and cutting back on essentials. Those who care for 35 hours or more a week are twice as likely to be in bad health as non-carers, with the knock-on effect that that will have on their own health in the future. Therefore, I believe that we have to look very carefully at the levels of funding and at what the eligibility criteria mean.
So far as carers are concerned, the Care Act is all that I could wish for—and have been working for for almost the last 30 years. It is ironic that it is being implemented at a time when budgets are so tight that the rights of carers may be threatened, not enhanced.
Earl Howe
My Lords, I am grateful to all noble Lords who have spoken for their questions and comments on these regulations. I turn first to the regulations relating to business failure duties and market oversight criteria, and in particular to the question posed by the noble Lord, Lord Lipsey, about why we have chosen the CQC as the regulator in this regard. I say openly to him that it was a finely balanced decision. We were confident that we had a choice between the CQC and Monitor. Either could have performed the role. Last year, the Health Select Committee recommended that the Government should reconsider their decision to choose the CQC rather than Monitor to undertake this regulatory function.
However, as set out in the committee’s report, there is a close correlation between poor quality and poor financial performance. It recognised that for this reason the CQC is well placed to perform the function. The CQC is gearing up to do that. It recognises that it needs additional skills to assess the financial sustainability of providers. It does not yet have these core skills in-house. The CQC has procured external consultants to assist in designing its new regime and the resources needed to operate it, which will comprise a mix of internal and external expertise. That will ensure value for money. It is recruiting a number of highly experienced specialists in accounting and insolvency who will be responsible for undertaking the financial sustainability assessments of providers in the regime on an ongoing basis.
The department will support the CQC to carry out this function by providing additional funding. I hope that that provides the noble Lord with some confidence that the CQC is well capable of undertaking this task. The CQC has published draft proposals on how the market oversight regime should operate. A four-week public consultation began on 29 January. Revised final guidance will be published in early April.
As regards the process of gathering financial information, which was referred to by the noble Baroness, Lady Wheeler, the CQC has the power to require a provider to supply the information specified. The provider cannot refuse without risking enforcement action by CQC. The CQC’s aim is that the information it requests from providers will be the same as the provider’s own board would use to assess how the business is faring. It will be light touch in the sense of not onerous. The CQC has a duty to minimise burdens on businesses. However, its overriding duty is to protect vulnerable people by understanding providers’ finances and sustainability, and giving early warning of any likely failure to local authorities to help them intervene. It will require information in a proportionate way to deliver this duty.
The noble Baroness also referred to the need to support local authorities to carry out their temporary duties when a care provider fails. We recently published statutory guidance outlining local authorities’ roles and responsibilities in the event of business failure to support them in this area. In addition, the department plans to work with the Association of Directors of Adult Social Services to develop further guidance on contingency planning for provider failure, which should be available by the summer of 2015. The department has also commissioned guidance which will help local authorities to assess the financial sustainability of their local care market and individual providers within it that are not subject to the market oversight regime.
As regards the Care and Support (Children’s Carers) Regulations, concerns were raised by the noble Baronesses, Lady Wheeler and Lady Pitkeathley, around children’s carers, and in particular the new right to assessment for carers in the Children and Families Act which covers adults caring for disabled children only when they have parental responsibility. The Government will address this issue through the Care Act 2014 and the Children and Families Act 2014 (Consequential Amendments) Order 2015, which will be laid in draft before Parliament very shortly. The order will effectively save Section 1 of the Carers (Recognition of Services) Act 1995 in so far as it applies to adults caring for disabled children who do not have parental responsibility. This means that such adults will continue to have a specific right to ask for an assessment under the 1995 Act if they are caring for a child being assessed under the Children Act 1989 or the Chronically Sick and Disabled Persons Act 1970. I hope that that is helpful.
As to the specific right of adults caring for children to support to meet eligible needs, care and support for children and their carers takes place in a different context to that covered by the adult statute. Children’s legislation rightly gives primacy to the welfare of the child and this is reflected in the way the legislation works. With that said, of course the Government recognise the enormous contribution of carers of disabled children and the sacrifices they often make in taking on these caring roles. That is why the Children and Families Act includes a specific right to assessment for parent carers of such children and a requirement that in carrying out these assessments local authorities must now have regard to the well-being of a parent carer. This mirrors the definition of well-being in the Care Act, which is of course also the basis for considering the impact on well-being through the eligibility criteria.
Lord Foulkes of Cumnock (Lab)
My Lords, if the Minister is going to correct my noble friend, could he say what the combined effect will be in percentage terms?
Earl Howe
I shall have to take advice before answering, but I will be happy to answer the question as soon as I receive inspiration.
Implementing the Care Act will be a challenge for local government, and takes place in the context of competing policy and financial pressures. However, we have already announced £470 million in total for the cost of the new duties in the Care Act which come into effect in April 2015. We have made substantial revisions to our impact assessment, following work with local authorities, to reflect changed assumptions on costs. This will mean acknowledging greater costs for carers in 2015-16 and beyond. We have recognised that.
In the first year, we will create a new carers grant to target this funding where it is most needed. As a result of this work, we believe that implementation of the Care Act will be affordable to local authorities in 2015-16. We will take further steps with the LGA and ADASS to agree a process for monitoring the costs in-year during 2015-16, to check on our assumptions and to provide evidence for the next spending review. Affordability is not just about the overall funding. We are also investing in a large suite of materials to help councils implement the Act effectively.
As regards the question posed by the noble Lord, Lord Foulkes, I am advised that the calculation that he seeks is not a simple one. I will need to write him a letter. I hope that he will allow me to do that. I shall try to be as explicit as I can in that letter.
Lord Foulkes of Cumnock
It is certainly not a simple calculation, and I think my noble friend was near the mark. Would the Minister send a copy of the letter to all the Members present?
Earl Howe
I will be very happy to do so.
The noble Baroness, Lady Wheeler, referred to the closure of the Independent Living Fund, and asked for the Government to provide guidance in the light of that. In response to the views of stakeholders during the consultation, we have provided guidance on how local authorities should manage the transition to social care for people previously receiving ILF funding. The guidance is included in the Care Act guidance that has now been published.
Both the noble Baroness, Lady Wheeler, and the noble Lord, Lord Lipsey, questioned the words “significant impact on well-being”. In particular, they expressed concern that there might be a variation of interpretation of that phrase. One of the core principles of the Care Act is that the person is central to the new care and support system, and that support is built around their needs and the outcomes they want to achieve. Considering the impact on the person’s well-being in deciding on their eligibility will make the determination personal to them. This recognises that people with similar needs and inabilities to achieve certain outcomes may have different eligibility determinations because the impact on their well-being is different.
It is important that there is consistency in approach in how the eligibility criteria are used. We have commissioned Skills for Care to develop training material and the Social Care Institute for Excellence to develop practice materials to support implementation of the eligibility criteria across authorities. Professional judgment will remain key to decision-making—this should not become a tick-box approach which does not focus on the person. We have never claimed that this will remove disparity. The system is person-focused, so it is inevitable and right that individual decisions will be made.
As regards the concern of the noble Baroness about requiring people to be unable to carry out two or more outcomes, and whether that would restrict access to care, this was an issue that was raised with the consultation version of the regulations, where there was concern that it would be impossible for people with mental health problems to become eligible due to how we described the outcomes that had to be considered. We addressed this in the regulations we are discussing today by converting the two lists of outcomes which were described in the consultation version of the regulations into one list which would capture all groups. We checked this approach with our stakeholder working group, which included members from the Care and Support Alliance and ADASS. The group concluded that it could not identify any groups that would be unintentionally excluded from eligibility due to this approach.
I turn next to the issue of informing the public, so that they have a clear understanding of their rights and the system overall. The noble Baroness will remember that we discussed this extensively during the passage of what is now the Care Act. We are putting in place a full communications campaign to ensure that people receiving services, their carers and families—and the broader population—understand the impact of the Care Act and what it means for them. The campaign will feature a partnership between the local and the national, building on the successful approaches pioneered by previous campaigns such as Change4Life. Local authorities, working with other local partners including the NHS and the voluntary sector, will get messages out directly to their own populations. We have developed a range of campaign materials and guidance to help councils communicate the changes in their local area. That will be supported by wider-reaching national activity—
The Deputy Chairman of Committees
With great respect to the noble Earl, I am afraid that a Division has been called in the Chamber. The Grand Committee stands adjourned until 4.35 pm.
The Deputy Chairman of Committees
My Lords, it is 4.35 pm. I happen to know that the Minister is on his way because I was with him in the corridor. If we could perhaps crave indulgence for just one more minute, I am sure he will appear.
The Deputy Chairman of Committees
The Minister has now rejoined us. I cut him off in mid-flow, so perhaps he would like to continue.
Earl Howe
My Lords, I have only a few more remarks to make. I was explaining the measures that we would take centrally and nationally to inform the public, including door drops to 2.5 million households and articles in the national media, as well as local radio and digital activity. The first phase, which focuses on people already receiving services, began late last year and is planned to continue through to April 2016. Scoping is also under way for a behaviour change campaign to encourage people to prepare for care and support needs as part of their wider financial planning.
The noble Lord, Lord Lipsey, questioned whether the final version of the regulations described the current level of access to care and support in an adequate way. We have commissioned the PSSRU to evaluate the final version of the eligibility regulations so that we can further our understanding of their impact. It will carry out its evaluation during the summer, when the regulations have been in use for six to eight weeks, and will report in August. However, there is no reason why people currently receiving care and support have to lose their access to this because of the introduction of the national eligibility threshold. The Care Act provides people with the assurance that local authorities must meet needs that meet the national threshold and, as I mentioned earlier, authorities can also decide to meet needs that are not eligible—in other words, they can meet needs that are considered moderate. Therefore, there is flexibility for local authorities in that sense.
To the extent that I have not been able to answer questions, I shall of course write to noble Lords. However, I hope that with those comments the Committee will be sufficiently reassured to approve these sets of regulations.
Care and Support (Children’s Carers) Regulations 2014
(9 years, 10 months ago)
Grand CommitteeRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Care and Support (Eligibility Criteria) Regulations 2014
(9 years, 10 months ago)
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Care and Support (Market Oversight Criteria) Regulations 2014
(9 years, 10 months ago)
Grand CommitteeRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Smoke-free (Private Vehicles) Regulations 2015
(9 years, 10 months ago)
Grand CommitteeRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Parliamentary Under-Secretary of State, Department of Health (Earl Howe) (Con)
My Lords, these regulations aim to protect children from the harms of second-hand smoke in private vehicles. In 2007, smoke-free legislation was introduced in England and Wales to protect employees and the public from the harmful effects of second-hand smoke in public places, work premises and vehicles. At that time, the legislation was not intended to extend to private vehicles.
The Children and Families Act 2014 amended the Health Act 2006 to give the Secretary of State regulation-making powers to make private vehicles smoke-free places when carrying children under the age of 18. Second-hand smoke is a serious health hazard, and there is no safe level of exposure. Every time someone breathes in second-hand smoke, they breathe in more than 4,000 chemicals. Many are highly toxic, and more than 50 are known to cause cancer. Second-hand smoke is a real and substantial threat to child health, causing a variety of adverse health effects, including increased susceptibility to lower respiratory tract infections such as pneumonia and bronchitis, the worsening of asthma, middle ear disease, decreased lung function and sudden infant death syndrome. We also know that children are more vulnerable to second-hand smoke exposure in vehicles as they breathe more rapidly and inhale more pollutants than adults.
A significant number of children say that they are exposed to second-hand smoke in private vehicles. In 2012, 26% of 11 to 15 year-olds reported being exposed to second-hand smoke in their family’s car and 30% in someone else’s car. We estimate that approximately 3 million children in England are exposed to second-hand smoke in their family car.
Research shows that smoking in vehicles can result in the build-up of high levels of second-hand smoke, which can persist even when windows are open or the ventilation system is in use. Many children feel unable to ask someone to stop smoking when travelling in a car. Research shows that 34% of children who are exposed to second-hand smoke in vehicles do not feel able to ask the person smoking to stop, because they are frightened or embarrassed.
The Government are committed to protecting children from the harms associated with smoking. Much support has been expressed in this House for ending smoking in vehicles carrying children. I commend all the noble Lords who have campaigned for the introduction of these provisions, particularly my noble friend Lord Ribeiro, who sought to introduce similar measures in his Private Member’s Bill.
The regulations extend the existing smoke-free legislation by setting out the circumstances when private vehicles are smoke-free. Specifically, they amend the current regulations that make public vehicles and work vehicles smoke-free so that all road vehicles that are not already smoke-free will be smoke-free places when they are enclosed and a person under 18 is present in the vehicle. As with the existing smoke-free legislation, the regulations do not apply to ships, hovercraft and aircraft, as they are covered under different legislation, and they do not apply to motor homes, camper vans and caravans when they are being used as a home. This is because the policy aim is for the regulations to apply to vehicles, not homes.
Lord Ribeiro (Con)
My Lords, I thank the Minister for his very kind words. This is a good-news day for children. These regulations and the Bill that went through are about protecting our children in the future. I think that we will send a very powerful message by passing these regulations and I hope that noble Lords will support them.
There is no point in rehearsing all the evidence that the Minister has very kindly given us. However, there is evidence that there has been a significant improvement in children’s health since regulations were introduced. We have only to look to Canada, where there is a ban on smoking in 10 of the 13 provinces. The evidence suggests that since the legislation was brought in, children’s exposure to second-hand smoke has dropped by a third.
The other important thing is the Government’s intention that these regulations should be not just punitive and about fining people but about behavioural change. When there was real reluctance from the Government to see the Bill go through—both when I introduced it as a Private Member’s Bill and early on during its passage—the questions raised were how to police it and how to ensure that people stick to the regulations and the law. The very fact that the emphasis is going to be on prevention, with a focus on health, is good.
Regarding the £50 fine that will be introduced, I am also delighted that the Government have taken the view that there will be a discount of £20 for those who pay within 15 days. That is a very important incentive. I had hoped that we might be able to introduce a learning exercise similar to the one for speeding, where people get some help in understanding the hazards and dangers of speeding. I had hoped that something like that might be brought in under this legislation. None the less, there will be a review five years from now in 2020, and if the general view is that the legislation has been effective, I am sure that it will be possible to devise an educational package so that people do not see the need to smoke in cars with children present. I thank the Minister for taking through these regulations.
Lord Foulkes of Cumnock (Lab)
My Lords, I greatly welcome this legislation. I want to ask two questions, which I hope the Minister will be able to deal with. Before doing so, though, I want to say why I am particularly pleased about this. In the early 1980s I tried to introduce a Bill in the other place to ban smoking in public places. I was almost literally laughed out of the House because everyone thought that it was ridiculous to have a ban on smoking in public places. Of course, it is now accepted as the norm.
I was also vilified, as indeed were all the anti-smoking campaigners, by an organisation called FOREST, the so-called Freedom Organisation for the Right to Enjoy Smoking Tobacco. I do not know how anyone can enjoy it—they just have to do it because they become addicted—but there we are. The organisation, which was funded by the tobacco companies, twisted all the figures. It was not a very pleasant experience. I know that my friends who worked in Action on Smoking and Health at the time, as well as other people, were subject to the same kind of criticism and attacks. I am very pleased that things have moved on since then and I commend the Government for pursuing this matter.
However, I have two questions. One relates to enforcement. The ban on smoking in public places has been effectively self-enforcing because the penalties and the problems that would be created by people smoking, particularly for publicans, shopkeepers and people responsible for public places, would be substantial, not just in terms of the fines that they might be subjected to but in terms of losing licences and other problems. Therefore, as I said, the ban has been effectively self-enforcing, with all but 100% compliance, I am pleased to say.
However, the legislation concerning the use of mobile phones in cars has not been so effective. I have seen a lot of people continuing to use mobile phones in cars while driving but I understand that there have been relatively few prosecutions of this extremely dangerous habit. I get the impression that the police are not particularly good at making sure that people are pursued in relation to that offence, and I am a little concerned that the offence of smoking in a car with children present will be more akin to using a mobile phone while driving than smoking in public places such as pubs, shops and so on. I would be grateful if the Minister could deal with that and give an assurance that enforcement and compliance will be more effective.
Secondly, unlike the noble Lord, Lord Ribeiro—who I commend for the way in which he has pursued this issue—I am not sure that £50 is a sufficient penalty. I understand that it is similar to the penalty for parking in an inappropriate or illegal place, a much less grave offence than one that causes danger and harm to children. Many people will take the risk of smoking in a car with children present, particularly as, with no disrespect, a £50 fine to Ferrari drivers and drivers of large, expensive cars will not mean very much in terms of their regular expenditure. I wonder whether this is an appropriate penalty for the offence. The Minister mentioned a review; perhaps this matter could be looked at in that review.
Those are my only two reservations, neither of which takes away from my warm welcome to the Government for these regulations. As the Minister knows, I do not regularly welcome the things that this Government do, but on this occasion I am pleased to do so.
Baroness Finlay of Llandaff (CB)
My Lords, I welcome these regulations and congratulate the noble Lord, Lord Ribeiro, on his work to achieve this position. Children themselves have asked for this measure. In the 2011 British Lung Foundation survey, 86% of children between the ages of eight and 15 said that they wanted protection. It is worth noting that the Welsh Fresh Start campaign, which was aimed at cutting down smoking in cars when children were present, did not have as great a success as one would have hoped, but these regulations send an important message that will change behaviour. Quite apart from encouragement to change behaviour, there needs to be a clear message out there.
The data from Wales have shown that 4% of children reported being in a car when someone was smoking almost every day, and 23% reported that they were sometimes in a car when someone was smoking. Where a parent smoked, one in five children reported that smoking was allowed in the family car. These regulations are welcome and will have a major part to play in bringing about behaviour change. Of course the fact that there are provisions for a fine is important, but behaviour change will be most sustainable in the long term.
I am grateful to the Minister for his comment that he will keep a watching brief on e-cigarettes and that that consultation will continue. I worry that we are at the beginning of an explosion of a highly addictive substance.
Baroness Tyler of Enfield (LD)
My Lords, I, too, welcome these regulations and congratulate my noble friend Lord Ribeiro on his unstinting efforts in this area. I stress that this new law and these regulations are not designed to turn smokers into criminals or to demonise them; they are about protecting children from the avoidable dangers that tobacco smoke presents to their health and welfare. For me, that is what it is all about. Right through these discussions, I always saw this legislation primarily as a matter of child protection. If noble Lords will excuse the terrible pun, it was about putting children in the driving seat.
When we had those early debates, I was very taken with the number of children who said that they felt that they had no control over the situation and that they were either too embarrassed or too scared to ask adults to stop smoking. The survey mentioned by the noble Baroness, Lady Finlay, referred to how children really want this legislation. In my professional life, we often talk about the voice of the child being at the centre of what we do. Based on that survey, we have a clear mandate from children and young people to take these regulations forward.
The Minister said that the start date will be October. In an ideal world I would have liked to have seen it earlier, but I accept the reasons that he gave. It will be incredibly important legislation in addressing health inequalities, and will go some way at least towards protecting children from the most disadvantaged backgrounds from smoke and enable them to have a healthier start in life. As others have said, this is very much about behaviour change. Certainly, the experience that we have seen on similar issues, such as public smoking and compulsory seat belts, suggests that educational campaigns, which are important, are most effective in changing behaviour when accompanied by appropriate legislation. For the effect of legislation on the proportion of people wearing seat belts, I have a figure that shows an increase from 25% to 91%, which seems extraordinarily large. Just imagine how many children’s lives will be improved if this legislation has even half that success.
The Minister referred to success being measured in terms of positive behaviour change rather than the number of fines handed out. I am sure that that is right, and I approve of that approach, but will he confirm precisely how that behaviour change will be measured?
There are very high levels of public support for the law. In previous debates, as one would expect, we heard that parents were very much in favour of this legislation. However, we also heard about recent surveys and the number of adults, including adult smokers, in favour of this legislation and the number of car drivers who support it. There is a real and growing consensus that these regulations are a good thing and should be introduced without delay.
I very much hope that, without much further delay, we will very soon debate the regulations on standardised packaging.
Viscount Simon (Lab)
My Lords, the Minister knows—I suppose I should declare it as an interest—that in January 1995 I developed severe brittle asthma. On a motorway with my car windows closed, I probably will have an asthma attack if someone is smoking a cigar in another car. Children are particularly vulnerable to second-hand smoke as they have smaller lungs and breathe faster, and their immune system is not as developed as that of adults. This leaves them more open to ear and lung conditions triggered by passive smoking.
It has not been mentioned this afternoon and it is not generally known or acknowledged, but the concentration of tobacco smoke in a car with the windows half down is much higher than the amount of smoke that there used to be in pubs in the old days, and it increases to 11 times more in a stationary car with the windows closed. If parents knew of this, I suspect that they would stop smoking in their cars, but they do not know. We therefore have these regulations before us today. The Minister has given us an excellent description of how the regulations will work, and I support them.
Lord Hunt of Kings Heath (Lab)
My Lords, I, too, welcome the regulations. They follow on from my amendment at Report to the Children and Families Bill, which was agreed by 222 votes to 197, to ban smoking in cars when children are present. I am very proud of that amendment and I express my thanks to organisations such as ASH, the British Lung Foundation, the BMA and others who lent their support to it. I echo the tributes to the noble Lord, Lord Ribeiro, and to other noble Lords who have been campaigning on this matter for some years, including the noble Baroness, Lady Finlay, my noble friend Lord Faulkner, and the noble Baroness, Lady Tyler. My noble friend Lord Simon persuasively and eloquently illustrated the issues that we are dealing with. I am confident that these regulations, if they come to be successfully implemented, will do a lot on those issues.
My noble friend Lord Foulkes was very brave, a long time ago, to pioneer the proposal. What he had to say about the tactics and activities of the tobacco companies was a point very well taken. I welcome the Government’s decision to go ahead with standardised packaging regulations but we know that many of those companies will do their best, through representative bodies, to sabotage them—as I think they have attempted to do in Australia. We must be ever watchful about that.
I agree with the noble Baroness, Lady Tyler, that it is interesting how much public support there is for this measure. She may well have seen the work by the British Lung Foundation which has shown, in survey after survey, that a huge majority of children wanted action to be taken. We have also had the ASH poll conducted last March by YouGov, which showed that 77% of all adults—including 64% of smokers—agreed that action should be taken. Does the noble Earl agree that that shows that there is public support for measures such as this, particularly when it comes to the protection of children? I wonder whether he shares our ambition on this side of the Committee to reduce smoking prevalence to 10% by 2025 and, over the longer term, our goal that all children born in 2015 and beyond will become the first smoke-free generation in hundreds of years.
I noted that the regulations come into force on 1 October 2015. The noble Earl explained why 1 April is not appropriate but I wonder whether 1 July could not have been chosen instead. The noble Baroness, Lady Finlay, raised the experience in Wales. Is the noble Earl confident that the provisions for Wales will come in at the same time as those for England? Could he say a little more about the public marketing plan being developed by Public Health England? That very much relates to the questions asked by my noble friend Lord Foulkes about enforceability, which is so important. I am confident that a great majority of the members of the public will in fact respect the change in the law. The evidence is pretty strong on that. None the less, we need an effective public health campaign and the support of the police in being prepared to take action against those who transgress the law.
Earl Howe
My Lords, I am very grateful to all noble Lords who have spoken and I am grateful for their universal welcome for these regulations. I begin by referring to the remarks of my noble friends Lady Tyler and Lord Ribeiro and the noble Viscount, Lord Simon, all of whom reminded us why we are doing this—the noble Viscount from a very personal perspective. Three million children are exposed to second-hand smoke every year and we want to protect them. Existing smoke-free legislation is popular, as has been said, and has a very high rate of compliance. Personally, I credit the public with more willingness to follow the law and therefore protect their children from second-hand smoke, rather than thinking of elaborate ways to break the law.
The noble Lord, Lord Hunt, asked about public attitudes in relation to these regulations. We know from the responses to the consultation that there is widespread support for protecting children from the harms of second-hand smoke. I do not expect people to go to great lengths to carry on smoking in cars when they know that it is an offence to do so. As has been said, legislation can be instrumental in driving behavioural and cultural change. That has certainly been true in other areas of regulation in the past. Of course, we have to inform the public in a reasonable way before these regulations come into force.
More generally, we agree that education is essential in informing people of the harms of second-hand smoke, particularly to children, and we recognise the importance of social marketing campaigns. The department and Public Health England will continue to protect children from the harms of exposure to second-hand smoke by encouraging voluntary action through social marketing. Previous campaign results illustrate that such campaigns have been effective both in changing behaviour and in driving quit attempts. Of course, I agree with the noble Lord, Lord Hunt, that our ambition as a nation should be to drive down the prevalence of smoking to the maximum extent that we can. We are going to monitor progress in respect of these regulations by assessing the reduction in the number of children who are exposed to second-hand smoke in cars from the current level of 26%, and it is possible to do that.
As I said, I agree with my noble friend Lord Ribeiro about the importance of building public awareness of these health harms. Once again, I pay tribute to all his efforts in this sphere of activity. I also add my thanks to the noble Lord, Lord Foulkes, for his welcome for these regulations, and I acknowledge his far-sightedness in this context, even if he felt like a voice in the wilderness for a number of years. He expressed concern about the enforcement of the regulations—in particular, in view of his perception that the police do not go to great lengths to enforce the mobile phone laws. In fact, my advice is that the police assure us that they endeavour to enforce mobile phone legislation, as they would any law. In fact, in 2012 more than 90,000 fixed penalty notices were issued for mobile phone offences. We estimate that considerably fewer fixed penalty notices will be issued for smoking in private vehicles—possibly around or slightly above 2,000 each year.
The noble Lord, Lord Foulkes, also questioned whether the £50 figure was sufficient. The regulations were drafted following discussions with the police and others to provide for effective enforcement. As I said, the police have confirmed that they will enforce these regulations in the same way as they enforce other laws, such as those relating to seat belts and the use of mobile phones. It is for individual police forces to decide how enforcement will be carried out locally. They have advised that this can be taken forward by local police officers in conjunction with their wider functions on road safety. For example, when running an operation to check compliance with the laws on seat belts or child car seats, the police would also check for anyone smoking or discuss the offences with the driver if there was tobacco in the car. A fine of £50 is consistent with the existing smoke-free legislation, but that level of fine could certainly be subject to review when the regulations as a whole are reviewed.
Lord Foulkes of Cumnock
Was any consideration given to putting points on licences? That would be a much greater deterrent. My understanding is that people feel very worried about having any points added to their licence because of the effect: once it tots up, they could lose their licence. I understand that this is being dealt with as a public health matter but in my view smoking while driving creates a bit of a danger, just as mobile phone use while driving does. I wondered whether that was considered as likely to be a more effective deterrent.
Lord Ribeiro
My Lords, before the Minister replies, when I phrased the initial Private Member’s Bill, I put in a fine of £60 rather than £50. One of the things that I was conscious of was that the people who would be driving very young children, those strapped into the back of the car, are mothers. We do not want to introduce punitive measures that would cut across trying to change their behaviour. That is why the fine was set at that level. If we were thinking of someone driving a Ferrari or a Maserati, that would be a completely different ball game—and they would probably have a chauffeur. That is why that figure is there. The emphasis should be on re-education rather than punishment.
Earl Howe
I am grateful to both noble Lords. In answer to the noble Lord, Lord Foulkes, on the question of points on the driving licence, this avenue was considered but rejected because it would be inconsistent with current legislation. However, I take the point about road safety. As he will be aware, if police judge that a driver is driving unsafely, they have powers to take action under different legislation.
With regard to the position in Wales, smoke-free legislation is a devolved matter, as the noble Lord, Lord Hunt, is aware. I am advised that the Welsh Government have consulted on similar provisions, and we are working with them to co-ordinate our approach where possible.
Lord Foulkes of Cumnock
I am sorry to come in again. Will the Minister confirm whether that is also the case in Scotland?
Earl Howe
My Lords, I am aware that there is legislation before the Scottish Parliament that seems to seek to introduce similar provisions, but I am not aware of the proposed timing that the Scottish Government envisage.
I was asked about the implementation date by the noble Lord, Lord Hunt. He put forward the suggestion that 1 July might have been a better date than October. We chose the common commencement date of 1 October because we judged that we would need that length of time to achieve a sufficient level of public awareness, and indeed for the police to be adequately prepared for their enforcement role.
Armed Forces Pension (Consequential Provisions) Regulations 2015
(9 years, 10 months ago)
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Lord Newby
That the Grand Committee do consider the Armed Forces Pension (Consequential Provisions) Regulations 2015.
Relevant document: 17th Report from the Joint Committee on Statutory Instruments
Lord Newby (LD)
My Lords, the regulations we are debating today make consequential modifications to the Pension Schemes Act 1993 and to the Finance Act 2004 to make sure that the major public pension schemes created under the Public Service Pensions Act 2013 work as intended.
They make some small and technical modifications to the law governing the new teachers’, NHS, civil service, police, firefighters’ and Armed Forces pension schemes. The consequential modifications relating to the Judicial Pension Scheme are being debated as part of its main regulations.
It might be helpful if I set out some of the context and background to the wider reforms to public service pension schemes. People are living longer and the cost of providing public service pensions is increasing. Following recommendations made by the noble Lord, Lord Hutton of Furness, and adopted by this Government, new pension schemes are being established under the Public Service Pensions Act 2013 for civil servants, the judiciary, local government workers, teachers, health service workers, fire and rescue workers, members of police forces and the Armed Forces.
These reforms were needed to balance the legitimate concerns of taxpayers about the cost of public service pensions with the need to ensure decent levels of retirement income for millions of people who have devoted their working lives to the service of the public. I am pleased to say that these reforms received cross-party support when they were debated in your Lordships’ House.
The design of the new schemes has now been settled, and the schemes will take effect from 1 April this year. The statutory instruments before us today are simply the means of ensuring that the scheme designs work properly within the wider framework of pensions and tax law. They will make sure that the members of these schemes get the pensions that they expect and that they do not lose out as a result of any glitches between the scheme design and the wider pensions law.
Two sets of modifications are being made to the Pension Schemes Act 1993, the first of which is needed to ensure that members moving from their existing schemes to the new schemes are not inappropriately treated as deferred members of their existing schemes. The purpose is to ensure a seamless transition between the old and new schemes.
The modifications are, first, to ensure that the benefits they have accrued in their existing schemes are not revalued as if they were deferred members; secondly, that their right to a cash equivalent transfer value, to a refund of contributions or to a cash transfer sum applies only when they leave the new scheme; and, thirdly, that anti-franking provisions do not apply as if they were deferred members on 1 April 2015. The modifications we are making mean that for these purposes such individuals do not cease to be active members of their existing scheme until they also leave their new scheme.
Lord Newby
As I was saying, the modifications that we are making mean that for these purposes such individuals do not cease to be active members of their existing scheme until they leave their new scheme.
We are also making modifications to the regulations that govern contracting out, specifically those dictating the process that a scheme must follow to be contracted out. For the new public service pension schemes we have simplified the process, ensuring that the new schemes, and therefore their members, continue to be contracted out of the additional state pension until the end of contracting out in April 2016.
The second set of modifications that we are making to the Pension Schemes Act 1993 concern only the police, firefighters’ and Armed Forces pension schemes. These are needed to ensure that the 1993 Act is in line with the 2013 Act, which requires active and deferred members in these three schemes to have different pension ages. To give a little context, the 1993 Act says that schemes cannot calculate the pensions of deferred members differently from those of active members, while the 2013 Act explicitly requires the uniformed schemes to assign a different pension age to active and deferred members. That difference in pension age makes a difference in pensions calculation inevitable.
In recognition of the unique nature of these occupations, and following recommendations made by the noble Lord, Lord Hutton, the Government are implementing a normal pension age of 60 in these three schemes, while members of other schemes will have a normal pension age well above this, set equal to state pension age, which for the majority of members will be 68. The Government have also decided to implement the noble Lord’s recommendation for deferred members of the police, firefighters’ and Armed Forces pension schemes to have a deferred pension age equal to the state pension age as the need for early retirement does not apply once a member has left these services and is no longer performing that unique and physically demanding role. The modifications before us today enable this split pension age in the police, firefighters’ and Armed Forces pension schemes to operate in harmony with wider legislation on short-service benefits.
The third set of modifications that we are making today relate to the Finance Act 2004 and ensure that members with service in both a new and an existing pension scheme who retire with an ill-health pension do not face unintended tax consequences. Specifically, they ensure that parts of the ill-health pensions available to members who fall ill are not measured twice for annual allowance and lifetime allowance limits simply because of the transitional mechanics for payment of ill-health benefits. Put simply, the modifications ensure that the tax regime will apply in the way intended by the Government to those members who move into the new scheme and then retire because of illness.
These are very technical modifications to wider pensions legislation that seek to ensure that civil servants, teachers, NHS staff, firefighters, police officers and military personnel can get the pensions that they expect without any unexpected effects as a result of tensions with the wider law. I therefore commend these modifications to the Committee.
Lord Tunnicliffe (Lab)
My Lords, the noble Lord, Lord Newby, and I seem fated to address technical and lengthy statutory instruments in front of a packed Committee, with the general public watching on with bated breath.
In representing Her Majesty’s Opposition in these circumstances, there seem to me to be two options: the one-hour option and the 100-hour option. The 100-hour option would mean tracing through all six documents and referring to, but not excluding, other laws and regulations made in 1992, 1993, 2004, 2006 and 2013 and sundry other modifications. Amazingly enough, I have not chosen the 100-hour option.
The one-hour option, of course, is to look at the Explanatory Memorandum and to see whether it is consistent and relevant, makes sense and so on. I have done that and I am pleased to advise the Committee that, in line with normal tradition, we will not be voting against these regulations when they come forward into the Chamber in a day or two’s time.
However, I felt a need to look behind the regulations. The way I did that was to look at the consultation. I felt that if the regulations were straightforward and fairly sensible and everyone involved with them also said that, then everyone would be happy. I looked into the consultation and it is fair to say that the consultees are content with five out of six of the sets of regulations. I shall therefore speak only to the one where the consultee—the Fire Brigades Union—is not content.
In response to the invitation to consult, it provided a letter dated 14 November from Sean Starbuck, its national officer. As I understand it, the union has three areas of concern. The first is that the benefits or value in its 1992 scheme could not be, as it were, crystallised and then imputed into the 2015 scheme. I am sure that there is a series of good pension words to more precisely express what I have said but we are all familiar with the system of pensions where you have a pension in one scheme moved to another scheme with a separate employer; there is then a calculation about the value of your accrued benefit, a calculation about the accrued benefits in the new scheme, money changes hands between the schemes and everyone is happy. As I understand the 2015 scheme, if you had worked in another firm or business, the state or—surprisingly in this case—the military, that is exactly what would happen. There would be a transfer of scheme value from, say, a military pension into the 2015 pension.
However, for firemen that is not possible. For firemen, as I understand it, one scheme ends and its value is deferred—I am sure that I have got the words wrong—until the point at which it is earned, and the service then starts in the 2015 scheme. The Fire Brigades Union took the view that it would be a good thing if that option was available to firefighters. Its view was that this should not be a problem because the very essence of these kinds of transfers is by definition cost-neutral. The money is calculated and moves over.
The union is particularly seized of that because, as I understand it—I confess I have not read the parent legislation—there is envisaged in the 2015 scheme a capability for partial retirement, which I gather everyone thinks is a good idea. That involves drawing some proportion of the pension but continuing to work on a part-time basis. It contends that the provisions that fall out of the various Acts and these regulations would make the partial retirement provision non-viable. Lastly, it contends that that does not honour assurances given by Ministers. It quotes in particular a Written Ministerial Statement of 28 October that states:
“Where firefighters are transferring to the 2015 scheme, they can be reassured that the pension they have built up in their existing schemes will be fully protected, and they can still choose to retire at the age they currently expect (which could be from age 50)”.
The Fire Brigades Union has had no formal direct response to its concerns, which seems to me to be of singular concern. In a sense, the union has had a partial response through the response in the Explanatory Memorandum. I mean “partial” in two ways: first, the response is incomplete, and, secondly, it affirms rather than proves that there is some cost. As the Minister said, the Opposition have more or less gone along with these regulations consensually because we recognise the financial problems and we are not seeking to burden the Government with more of them. However, the response affirms that it will be costly rather than arguing it through.
Lord Newby
My Lords, I am grateful to the noble Lord for his welcome of the regulations as a whole. Perhaps I may deal with the consultation and the Fire Brigades Union. The Department for Communities and Local Government undertook a short technical consultation on the draft regulations that we are discussing.
Lord Tunnicliffe
I noticed the word “technical”. I do not see suggested anywhere in the regulations the idea of technical. Obviously I have not read the Public Service Pensions Act cover to cover. It talks about consultation and I am not sure what is meant by the word technical in that context.
Lord Newby
My Lords, a key difference between these regulations and the main regulations being established under the Public Service Pensions Act is that these consultations cover only these technical regulations. The regulations we are talking about today are not the main scheme regulations. They are simply a series of regulations that enable the transition from the earlier scheme to the new scheme to go smoothly, without people being taxed twice or not taxed enough, and to make sure that, from the Government’s, the employer’s and the individual pension holder’s point of view, things move forward in terms of their entitlement, almost as though no new schemes were being introduced. That is why I used the word technical. Perhaps I should have said that they undertook a short consultation on the draft technical regulations, which would have been clearer English. As the noble Lord pointed out, the FBU submitted responses to that consultation.
As is always the case with these types of consultations, the department did not provide an individual response; it provided a response that covered them all. As the noble Lord said, it published its formal response in the draft Explanatory Memorandum which accompanied the draft regulations. Yesterday, a committee paper was circulated to members of the Firefighters’ Pension Committee notifying them of the outcome of that technical consultation. The noble Lord is right that that committee is coming to an end, but it is being subsumed into the scheme advisory board, which will be a body on which the FBU is represented and the purpose of which is to advise the department on the operation of the new scheme going forward.
Lord Tunnicliffe
My Lords, if it is technically possible, perhaps I could receive a copy of that circulated paper electronically so that I might have it in my in-tray by tomorrow morning.
Lord Newby
The noble Lord certainly can have a copy of the response sent to the committee. I am happy to give that assurance. That is what has happened. In terms of the FBU’s concern, its response proposed that these regulations should permit former scheme members who joined the new firefighters’ pension scheme to transfer 2006 scheme benefits into the 2015 scheme and allow 1992 scheme members to take their pension without having to retire or face a tax charge. The former would increase scheme costs and the latter would substantially increase costs, as 1992 scheme pension benefits will come into payment earlier and will be unfunded. It was open to representative bodies to put forward alternative scheme designs during the discussions leading up to the publication of the proposed final agreement to ensure that any increased costs were taken into account when setting the accrual rate in the 2015 scheme.
The department concluded that it was not appropriate to use these regulations, which are of a technical nature, to provide unfunded improvements to existing scheme benefits, as requested in the consultation. There is a process point about which regs would be the appropriate ones to deal with that issue. The department and the Government’s contention is that, as these are very technical regulations, they are not the appropriate regulations to do that. The main scheme regulations, if it were to be done, would be the way to do it. However, the Government are not convinced that it should be done. No doubt these issues will be raised again in ongoing discussions via the scheme advisory board between the FBU, the department and other stakeholders.
Firefighters’ Pension Scheme (England) (Consequential Provisions) Regulations 2015
(9 years, 10 months ago)
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Lord Newby
That the Grand Committee do consider the Firefighters’ Pension Scheme (England) (Consequential Provisions) Regulations 2015.
Relevant document: 17th Report from the Joint Committee on Statutory Instruments
Police Pensions (Consequential Provisions) Regulations 2015
(9 years, 10 months ago)
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Lord Newby
That the Grand Committee do consider the Police Pensions (Consequential Provisions) Regulations 2015.
Relevant document: 17th Report from the Joint Committee on Statutory Instruments
Public Service (Civil Servants and Others) Pensions (Consequential and Amendment) Regulations 2015
(9 years, 10 months ago)
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Lord Newby
That the Grand Committee do consider the Public Service (Civil Servants and Others) Pensions (Consequential and Amendment) Regulations 2015.
Relevant document: 17th Report from the Joint Committee on Statutory Instruments
National Health Service Pension Scheme (Consequential Provisions) Regulations 2015
(9 years, 10 months ago)
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Lord Newby
That the Grand Committee do consider the National Health Service Pension Scheme (Consequential Provisions) Regulations 2015.
Relevant document: 17th Report from the Joint Committee on Statutory Instruments
Teachers’ Pension Scheme (Consequential Provisions) Regulations 2015
(9 years, 10 months ago)
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Lord Newby
That the Grand Committee do consider the Teachers’ Pension Scheme (Consequential Provisions) Regulations 2015.
Relevant document: 17th Report from the Joint Committee on Statutory Instruments
House of Lords
Philippines: Typhoon Haiyan
Lord McConnell of Glenscorrodale
To ask Her Majesty’s Government what assessment they have made of the international recovery effort following Typhoon Haiyan in the Philippines and the United Kingdom’s contribution to that effort.
Lord Bourne of Aberystwyth (Con)
My Lords, the United Kingdom was the largest bilateral donor, contributing £77 million in response to Typhoon Haiyan. The Independent Commission for Aid Impact found the United Kingdom’s response to the crisis to be exemplary. While some longer-term needs remain, the Government of the Philippines are of course leading the recovery effort with international support, including more than £8 million from the United Kingdom. That support is helping to increase communities’ capacity to manage extreme weather events.
Lord McConnell of Glenscorrodale (Lab)
I thank the Minister for his Answer and the Government for their strong support for the Philippines. I look forward to seeing the results of some of that support when I return there as a parliamentary volunteer during the February Recess. The sustainable development goals drafted by the United Nations for post-2015 include goal 11, on the important issue of resilience to natural disasters and extreme weather events. Will the UK Government be arguing strongly for natural disasters and resilience to extreme weather events to feature prominently in the final goals agreed in September?
Lord Bourne of Aberystwyth
I pay tribute, first of all, to what the noble Lord has already been doing in the Philippines; as he has just said, he is going there again, and he has made a significant difference. On the sustainable efforts that he mentioned in relation to millennium goals and continuing development, the United Kingdom is committed to ensuring that climate is fully referenced post-2015 and that natural resource management is up front. Everything that we have been doing with our assistance has been towards supporting continual, sustainable development.
Lord Avebury (LD)
My Lords, I understand that less than a third of the $788 million needed by the Office for the Coordination of Humanitarian Affairs programme for the recovery of the Philippines has been received. Has the Disasters Emergency Committee in the UK yet activated the pledge it made of £88 million, and will we encourage other rich states to come up to the plate and contribute, too?
Lord Bourne of Aberystwyth
As I said, the United Kingdom has been the largest single donor, eclipsing even the United States—which, of course, is a far richer country and has far stronger ties with the Philippines. We are committed to ensuring that all the aid that we have contributed is spent on ensuring that this dreadful disaster is met and on trying to provide resilience against future disasters.
Baroness Hayman (CB)
My Lords, I declare an interest as a trustee of the Disasters Emergency Committee. Following on from the point of the noble Lord, Lord Avebury, does the Minister agree that, in addition to the Government’s response, the British public responded to the appeal with enormous generosity and that the independent assessment of the results of that generosity has shown that UK aid and humanitarian agencies have provided highly effective and timely help on the ground?
Lord Bourne of Aberystwyth
I join the noble Baroness in paying tribute to what the charitable sector has done. It always responds magnificently in the United Kingdom, and it certainly did in relation to this disaster. Of course, the United Kingdom has also given through the EU, so we have actually given in addition to the sums that we have given as the single largest donor.
Lord Collins of Highbury (Lab)
My Lords, it is a sad fact that the vulnerable poor cluster in areas where climate change has a disproportionate effect. Last March, DfID declared that investment in the Philippines would be focused on building back better and longer-term climate resilience. Has the aid focused on protecting the poorest and most vulnerable?
Lord Bourne of Aberystwyth
Clearly, the area affected has been extremely poor, even by Philippine standards—the Philippines being a relatively poor country. We have sought to use the aid to meet the immediate need but also to provide resilience against future events of this nature. Indeed, all the housing that was put up in response to Haiyan withstood the more recent, dreadful typhoon, Hagupit, at the end of last year. In addition, money is being spent on ensuring that there is insurance and on getting better advice on meteorological events. As I said, we are very keen that climate change features in the 2015 millennium development goals.
Lord Hylton (CB)
My Lords, there have been reports of moneys that had been made available standing idle in bank accounts. Will the Government ensure that what is available is spent promptly and effectively and that there are proper safeguards against corruption?
Lord Bourne of Aberystwyth
It remains very much at the forefront of the thinking of the Secretary of State and the department to ensure that the money is got out and used very quickly, and that is happening. I come back to the independent assessment of ICAI, which gave us green lights on all but one factor—which was in relation to medium-term goals, and we have sought to assess that—so our response has been exemplary, not least in making sure that the money is usefully spent.
Baroness Manzoor (LD)
My Lords, what is being done regarding the immunisation programme for children? Are we giving aid to that area?
Lord Bourne of Aberystwyth
Yes, that is also happening. We recognise the danger of water-borne disease, so immunisation and healthcare are very much at the forefront of ensuring that money is well spent, as is being done on shelter as well. These are priority areas.
The Earl of Sandwich (CB)
Does the noble Lord agree that these additional priorities in the Philippines, the Middle East and so on have brought the United Kingdom’s share up to and past the 0.7% figure? This must be enshrined in law and noble Lords must support that.
Lord Bourne of Aberystwyth
I personally strongly support the party-political broadcast that the noble Earl has just given. This is important. We have a very good record on international aid and I hope very much that the figure is enshrined in law.
Lord West of Spithead (Lab)
My Lords, does the Minister agree that the new aircraft carriers are amazingly well configured for disaster relief, and that if they are used for that in future there ought to be a better mechanism for transferring money across from DfID funding to defence when they are used in that way?
Lord Bourne of Aberystwyth
Talking of party-political broadcasts, I very much congratulate the noble Lord on his contribution. He will be aware that both the RAF and the Royal Navy were part of the response to Typhoon Haiyan. The Ministry of Defence was accredited with the spending that they both incurred.
Smoking: E-Cigarettes
(9 years, 10 months ago)
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Viscount Ridley
To ask Her Majesty’s Government whether they will consider encouraging rather than discouraging the spread of vaping, in the light of the Cochrane review of e-cigarettes published on 17 December 2014 which found that e-cigarettes were more effective as an aid to quitting smoking than any other method.
The Parliamentary Under-Secretary of State, Department of Health (Earl Howe) (Con)
My Lords, we recognise that e-cigarettes are being used by some smokers to help them cut down, or quit, tobacco. That is why the Government are already working towards a regulatory framework that ensures that they meet basic quality standards and are accompanied by sufficient information to enable informed choices. However, we would not wish to see children taking up vaping, as nicotine is a highly addictive substance. That is why we are also introducing a minimum age of sale for these products.
Viscount Ridley (Con)
I thank my noble friend for that encouraging Answer, but I hope that I can lure him into going just a little bit further. Given that 2 million people are vaping in this country, including a number of Members of your Lordships’ House, that 99% of them are smokers or ex-smokers and that the NHS says that vaping is 1,000 times safer than smoking and probably no more dangerous or addictive than coffee, does he therefore agree with me that it might be worth asking the Chief Medical Officer to look into how we can encourage this technology, given that it has a chance to do what patches, bans, health warnings and taxes have failed to do over decades, which is at last to consign the cigarette to the ashtray of history?
Earl Howe
My Lords, e-cigarettes are undoubtedly helpful to some people in enabling them to cut down on, or quit, smoking. The evidence is encouraging and we would not want to stop smokers trying out e-cigarettes as an alternative, particularly if other remedies have failed. Equally, we need to be cautious as regards the long-term health effects of using e-cigarettes. That is why the Chief Medical Officer is currently not able to recommend their use.
Lord Hunt of Kings Heath (Lab)
My Lords, does the noble Earl agree that the noble Viscount is perhaps guilty of a little bit of journalistic licence on this issue? The Cochrane review undoubtedly produces encouraging results, but its research contains a big “but”, in that it cautions that only two studies, covering just over 600 smokers, were reflected in the review. The Cochrane review says that we should await the outcome of further studies. Does the noble Earl agree, and can he inform the House when we are likely to see the outcome of those further studies?
Earl Howe
My Lords, the noble Lord is correct. The Cochrane review concluded that the quality of the evidence overall is low because it is based on only a small number of studies. The National Institute for Health Research has recently commissioned a large randomised control trial to examine the efficacy of e-cigarettes compared with nicotine replacement therapy when used within the UK’s stop smoking services. That project is due to end in 2018 and will certainly improve our current understanding.
Lord Rennard (LD)
My Lords, does my noble friend agree that we need a public health education campaign to persuade people that there are absolutely no health benefits whatever, or indeed any merit, in becoming addicted to nicotine, and that the promotion of devices such as e-cigarettes should be purely for the purposes of encouraging people to be weaned off their addiction to tobacco with nicotine, as tobacco is still killing nearly 300 people every day in this country?
Earl Howe
My noble friend is absolutely right. I hope that message will come through loud and clear from the measures the Government are taking to ban smoking in private cars when children are present, to introduce standardised tobacco packaging and to prohibit proxy purchasing of tobacco.
Lord Cunningham of Felling (Lab)
My Lords, is the noble Earl satisfied that e-cigarettes are tamper-proof and that what they contain cannot be substituted for other more dangerous substances?
Earl Howe
The noble Lord makes an extremely important point. It is one that is addressed in the tobacco products directive, which is due to come into force next year. The EU Commission is clear that any e-cigarettes sold need to be tamper-proof, particularly as regards children interfering with the contents.
Lord Patel (CB)
My Lords, it is good to know that the National Institute for Health Research would support a larger randomised study, but what the noble Viscount, Lord Ridley, said is true. The current evidence from the Cochrane analysis—the most robust method we know of analysing whether a product, device or a drug is effective against the desired outcome—is that, although the studies were small, 14 observational studies and two randomised trials show that e-cigarettes are more effective than nicotine patches or a placebo. Would the Minister agree that the industry should now also address a standard dosage of nicotine and ensure that the quality of the nicotine used in e-cigarettes is standardised across the industry to avoid subsequent risks?
Earl Howe
The noble Lord makes some important points. He has highlighted the fact that many products on sale are of, shall we say, variable quality. There are risks around the extent to which the dose of nicotine delivered varies; the quality of the ingredients can be suspect; and there is a question mark over the electrical safety of some products. We cannot make a general statement about products that are currently on sale. Nevertheless, it is right that the European Union has taken this matter in hand. From May 2016, only licensed e-cigarettes will be able to contain nicotine in strengths greater than 20 milligrams per millilitre. That will introduce some standardisation.
Earl Cathcart (Con)
My Lords, I started smoking before I was a teenager and in recent years smoked up to 50 cigarettes a day—not good for me. I started vaping in July and I have not had or wanted a puff of tobacco since. In spite of trying to give up on countless occasions, only these vaping e-cigarettes have actually helped me kick the habit. Surely that has to be a good thing. Should we not encourage it to help not just me, but the hundreds of thousands or millions of people who want to give up smoking?
Earl Howe
May I congratulate my noble friend on his achievement? As I have indicated, the advice given by the NHS is that, particularly where other remedies have failed, e-cigarettes may have a place where the person wants to quit. It is true that, while levels of toxicants are present in electronic cigarette liquids and vapour, they are very much lower than those found in conventional cigarette smoke. They are not considered to pose any significant passive inhalation risk.
Credit Unions
(9 years, 10 months ago)
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Lord Kennedy of Southwark
To ask Her Majesty’s Government when they plan further reform of the law regarding Credit Unions.
Lord Kennedy of Southwark (Lab)
My Lords, I beg leave to ask the Question standing in my name on the Order Paper. In doing so, I declare an interest as director of London Mutual Credit Union.
Lord Newby (LD)
My Lords, on 31 December 2014 the Government published a response to the call for evidence on credit unions. In this response, the Government committed to consider, in the next Parliament, potential changes to credit union legislation.
Lord Kennedy of Southwark
My Lords, it is important for credit unions to be able to grow on a solid base to deliver for their members. Whichever party or parties are in government after the general election, would the noble Lord agree that two of the most important areas for reform are reform of the 2 million cap on potential members—maybe change that to actual members—and removal of the legal barriers to enable credit unions to give other financial products to their members?
Lord Newby
Yes, I agree with the noble Lord that those are both important issues. In the response to the call for evidence, the Government have committed to considering changes to the common bond legislation. The noble Lord will be aware that credit unions maintain their exemption from the consumer credit directive only if they have a restricted potential market. It is important that we do not expand the definition of the common bond in ways that could jeopardise that exemption.
Lord Hunt of Wirral (Con)
In declaring my interest as chair of the Credit Union Expansion Project, I point out to my noble friend the Minister how much I welcome the measures that this Government have taken to reform credit union legislation and the recent commitment made to produce proposals for further reforms in the next Parliament. I join the noble Lord, Lord Kennedy of Southwark, in welcoming that. I hope that it will receive support from all sides of the House. Will the Minister agree that legislation is only part of the answer? Helping credit unions to co-operate and to become more competitive and attractive will be key to growing this sector sustainably.
Lord Newby
Absolutely, my Lords, and I commend the noble Lord for his work in this area. Increased collaboration is vital if the sector is to become more competitive and grow. The Credit Union Expansion Project, to which the noble Lord referred and which the DWP is funding to the tune of £38 million, is aimed at doing exactly that—for example, by providing shared back-office services to cut costs. However, the sector would also be strengthened if it were able to speak with one voice, which requires a reduction in the number of trade associations currently operating in the sector.
Lord McFall of Alcluith (Lab)
My Lords, our ambitions for the growth of credit unions on a national scale have a long way to go. Given that banks and building societies have extensive networks and operational systems, is there now a case for the Government to consider establishing a community reinvestment Act, as in the United States, as a solution to the problem of providing affordable finance for all individuals?
Lord Newby
My Lords, there is scope to look at a whole raft of new initiatives, to make sure that there is access to finance for people on more modest incomes. One development in recent weeks has been agreement with the banks on fee-free basic bank accounts, which will be a good improvement for many people who are currently denied even the most basic bank accounts.
Lord German (LD)
My Lords, the Credit Union Expansion Project was designed to enable people on lower incomes to have access to modern banking methods. One of the problems for people in this category is that they have not been able to get cheaper electricity and gas bills because they have been unable to pay by direct debit. Can my noble friend say what progress has been made by both credit unions and the Post Office card account to enable people to access those cheaper bills through the direct debit mechanism?
Lord Newby
As my noble friend says, this is a very important issue for people on low incomes. A number of the largest credit unions already offer current accounts that have a direct debit facility. However, they are still a small minority. This is an area where the Credit Union Expansion Project is very important, as it will allow more of them to offer such services.
More generally, the Government’s announcement in December about basic bank accounts means that people who open such accounts will have access to a range of normal personal current account facilities, including direct debits.
The Lord Bishop of St Albans
My Lords, I imagine many of us are concerned about the culture of debt that seems to be normative in many parts of our society. In the light of this, can the Minister tell us whether the Government have any plans, first, to encourage all schools to consider working closely with credit unions, as in the case of the credit union in St Albans, where I come from and, secondly, to further roll out and encourage payroll savings schemes as part of a wider initiative to encourage saving and financial responsibility across society?
Lord Newby
My Lords, the Government support both those concepts. The right reverend Prelate will be aware that the Government have been working with the Archbishop of Canterbury’s task force on affordable credit and savings to institute the LifeSavers project, under which primary schools are working with credit unions to encourage young children into good savings habits and raise awareness of credit unions.
Lord Davies of Oldham (Lab)
My Lords, the House will have noticed just how vague the Government’s commitment is when they say that after the election—yet another commitment for “after the election”—they will introduce additional legislation. Does the Minister recognise that what the next Labour Government will do is to increase the levy on payday lenders in order to help the development of credit unions?
Lord Newby
My Lords, the Government have legislated several times to modernise the law in respect of credit unions. The proposals of the Labour Party are based on an assumption that payday lenders represent a large stock of cash. The way in which the payday lending industry is going suggests that there simply will not be that amount of resource available from the sector.
Lord Clarke of Hampstead (Lab)
My Lords, when this subject was discussed on a previous occasion, I asked the Minister if he would liaise with the Department for Education to see if some sort of campaign could be set up to get children at school learning about the benefits of credit unions. St Albans credit union, of which I am a member, has links with a number of schools. This helps children get into the habit of understanding the need to save before they borrow. Did any talks ever take place between the two departments, and if not, will they go ahead and do so now?
Lord Newby
My Lords, as I have said, the Government are working with the Archbishop of Canterbury’s task force to get credit unions into schools, initially in Lewisham, Bradford and Nottingham, but with a view to rolling the project out in the near future to 100 schools and involving 30,000 children. Also, for the first time last autumn, we instituted financial literacy as a compulsory part of the national curriculum.
Greece: New Government
(9 years, 10 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Lord Clinton-Davis
To ask Her Majesty’s Government what are their priorities in establishing a relationship with the new government of Greece.
The Minister of State, Foreign and Commonwealth Office (Baroness Anelay of St Johns) (Con)
My Lords, the Government’s first priority is to establish a strong working relationship with Greece’s new Government. Last week, the Prime Minister called Prime Minister Alexis Tsipras on the telephone to congratulate him, and yesterday the Chancellor met the new Finance Minister, Yanis Varoufakis. The UK remains committed to working closely with the new Government on the full range of bilateral, EU, NATO and wider international issues.
Lord Clinton-Davis (Lab)
My Lords, are not the poor and many middle-class people in Greece enduring unbelievable hardship? What are the United Kingdom Government able to do to mitigate this disaster? Are the people of Greece able to look forward in any way? It is hardly surprising that they are resorting to radical measures. What can the Government do, given that Britain is a member of the European Union, to alleviate their plight?
Baroness Anelay of St Johns
My Lords, we are indeed a member of the EU, but we are not a member of the eurozone; so I would gently say to the noble Lord that we are not directly involved in Greece’s debt repayment negotiations, and nor indeed should we be. Of course, we are open to the discussions with the Greek Government, as I explained in my first Answer. The discussions yesterday were cordial and constructive, and that was the interpretation of both the Greek Finance Minister and the Chancellor of the Exchequer. As I say, we are open to discussions, but since we are not a member of the eurozone we are not the country that will take the decision about how the Greek Government may decide to present their plans—which possibly will be next week. I know that they are working hard to achieve that.
Lord Pearson of Rannoch (UKIP)
My Lords, given the euro’s catastrophic effect on jobs and prosperity, should not our top priority be to encourage Greece, and indeed the other euro member states, to abandon it? If that led to the collapse of the whole project of European integration, would that not be hugely beneficial to us all? Just in case the Minister does not agree with me, can she tell noble Lords what is now the point of the European Union and its wretched euro?
Baroness Anelay of St Johns
My Lords, it is clear that the stand-off between Greece and the eurozone is fast becoming the biggest risk to the global economy and is a rising threat to our economy at home. I say that, and indeed the Chancellor of the Exchequer said it yesterday after his meeting with the Greek Finance Minister. It is up to Europe to come to a conclusion which means that Greece can remain part of the euro, that the European Union can prosper, and that jobs and growth can continue. That is the way forward for success in Europe and for the success of this country in Europe.
Baroness Ludford (LD)
Does my noble friend agree that if, as we all hope, the eurozone is to get more jobs and growth, then in communicating with the Greek Government, we must urge structural reforms, including eliminating cronyism and corruption; that those are essential if we are to get, in the words of the new Finance Minister, a reformed, not a deformed, Greece; that fiscal responsibility and sustainability are essential; that spending more money without knowing where it is coming from—a fault not unknown in some parties in this country—is inadvisable; and that the UK can also offer the Greek Government the benefits of the progress that has been made in this country in tackling tax evasion in the last five years?
Baroness Anelay of St Johns
My Lords, I agree with every word that my noble friend said.
Baroness Hooper (Con)
My Lords, can my noble friend reassure us and confirm that the relationship between Greece and the UK has been greatly reinforced by the educational exchanges that have taken place over the years, especially in the field of medicine? Will she therefore reassure us that the existing educational initiatives will be reinforced?
Baroness Anelay of St Johns
My Lords, I entirely agree with my noble friend on the importance of those educational exchanges. Work is done throughout various government departments and the FCO always looks very carefully at how we can give advice on such matters, too.
Lord Tomlinson (Lab)
Does the Minister agree that it is a little bit too simplistic just to say, “We are not members of the eurozone”, and therefore almost wash her hands of it? There are loans from the International Monetary Fund and we have an interest in those loans being properly managed. Can she tell us what the Government’s intention in that regard is?
Baroness Anelay of St Johns
My Lords, we would never wash our hands of discussions with our colleagues within the European Union. I think that I have made it clear that both the Prime Minister and the Chancellor of the Exchequer have already had discussions. Indeed, my right honourable friend the Prime Minister telephoned Mr Tsipras on the very day that the Greek Prime Minister took his position. Discussions are ongoing and there will, of course, be meetings next week at the European summit. As regards the IMF, we are indeed part of the system that backs it up. The IMF’s status as preferred creditor means that it is repaid first. What is important is that we do not get to the point of a Greek default. The new Greek Government are working on that and it is important for them to be able to discuss what kind of package they can put together, as they work around their colleagues in the eurozone this week.
The Lord Privy Seal (Baroness Stowell of Beeston) (Con)
My Lords, as the noble Lord rose before we had got to half an hour, we will take a final question; and as we have not heard from the Cross Benches on this Question, it will be for them to ask it.
Lord Kilclooney
My Lords, when the Chancellor of the Exchequer met the Greek Minister yesterday, did he point out to him the advantages the United Kingdom had by not being a member of the eurozone?
Baroness Anelay of St Johns
My Lords, he pointed out the advantages of having a Government who put competence over chaos.
Hereditary Peers By-Election
Renewable Heat Incentive Scheme (Amendment) Regulations 2015
Baroness Verma
That the draft regulations laid before the House on 10 and 15 December 2014 be approved.
Relevant document: 17th Report from the Joint Committee on Statutory Instruments. Considered in Grand Committee on 27 January.
National Employment Savings Trust (Amendment) Order 2015
Lord Bourne of Aberystwyth
That the draft orders laid before the House on 8 and 16 December 2014 be approved.
Relevant document: 17th Report from the Joint Committee on Statutory Instruments. Considered in Grand Committee on 29 January.
Misuse of Drugs Act 1971 (Amendment) Order 2015
Baroness Williams of Trafford
That the draft order laid before the House on 17 December 2014 be approved.
Relevant document: 17th Report from the Joint Committee on Statutory Instruments. Considered in Grand Committee on 29 January.
Deregulation Bill
(9 years, 10 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
16:25 - Division on Amendment 3 - Ayes: 190 / Noes: 259 - Amendment 3 disagreed.
17:22 - Division on Amendment 4 - Ayes: 191 / Noes: 235 - Amendment 4 disagreed.
Lord McKenzie of Luton
“(2) After subsection (2) (which imposes a general duty with respect to health and safety on self-employed persons) insert—
“(2A) Nothing in subsection (2) shall preclude the Secretary of State from making regulations exempting self-employed persons carrying out certain activities from the provisions of subsection (2) or from specified regulations thereunder where it can be shown that their work activities pose no potential risk of harm to others.””
Lord McKenzie of Luton (Lab)
My Lords, in moving Amendment 1, I shall speak also to Amendment 2. The purpose of these amendments is to ensure that any changes to health and safety legislation affecting the self-employed do not stray more widely than those recommended by Professor Löfstedt and that the prescribed description approach currently in the Bill is removed. They further seek to ensure that the process for constructing and implementing regulations is fit for purpose and require them to meet certain criteria, something which has eluded government attempts so far.
In his report, Reclaiming Health and Safety for All, Professor Löfstedt recommended that those self-employed whose activities posed no potential risk of harm to others should be exempt from the general duties of the Health and Safety at Work etc. Act 1974. This is notwithstanding that it is generally acknowledged, including by the professor himself, that the current duties do not overburden the self-employed and that any requirements in such situations would be minimal in terms of time, cost and enforcement effort by the HSE and local authorities. But the Government accepted this recommendation, asserting that Europe adopted a more proportionate response on such matters and that it would remove unnecessary concerns over the perception of heavy-handed enforcement. Given the minimal benefits which would flow from implementing the recommendation, and the risk of confusion which any legislative change could engender, we and many others have argued for making no change—for the status quo—and this remains our preferred position. Nevertheless, we have to accept for the time being at least that this is not the position adopted by noble Lords in Committee.
The task as we see it now is to constrain the primary legislation and require a robust process for secondary legislation to see that the professor’s recommendation can be accommodated without the prospect of wider exemptions from health and safety legislation being adopted by default, mistake or otherwise—in other words, as the CBI recommends, going back to square one.
Baroness Donaghy (Lab)
My Lords, it is important to place on the record and clarify some of the misunderstandings that took place in Committee. At the beginning of the discussions on the Bill, the Government prayed in aid, with a great deal of enthusiasm, the recommendations of Professor Löfstedt, who is professor of risk management at King’s College London. That enthusiasm became less and less as Members of the Committee challenged some of the statements contained in the proposals. Certainly, my noble friend Lord McKenzie challenged them on a number of occasions.
In Committee on 21 October, the noble Lord, Lord Curry of Kirkharle, said:
“I was in contact with Professor Löfstedt in the past week. He has seen the wording of the Bill and appears to be very content with it”.—[Official Report, 21/10/14; col. 568.]
It is important that we set the record straight: Professor Löfstedt is not in the least bit happy. My noble friend has already quoted from his letter. To save time, I will quote a small additional bit. He says that,
“the proposed Government list may increase injury and death in the workplace something that I never intended with my original recommendation”.
It is very serious that there has been a misunderstanding about the authoritative recommendations that were claimed to be behind this proposal. I agree with my noble friend: it will increase confusion; it will add complexity to the Health and Safety at Work etc. Act; it will add burdens to the conscientious self-employed who want clarification about their obligations; and it is a charter for cowboys. I urge the House to support the amendment.
Lord Lea of Crondall (Lab)
My Lords, it is very noticeable that when people such as those from the Federation of Small Businesses are asked, “Where is the evidence that more people ought to be excluded?”, they say, “It is not a question of particular evidence; it is a question of perception”. Something rings a bell in my mind when somebody says, “It is not the evidence; it is a question of perception”. As somebody once said, what about changing the perception? I think that is where we are at the moment. Indeed, that is where the Government and the employers do not want us to be—to look at the evidence.
Instead, there are lots of crocodile tears and lots of red herrings dragged across the trail. One red herring is, “They do it in Germany”. Well, they do lots of things in Germany. In the one minute I have available, I say to the Government that if they would like to start citing Germany and give us the whole employment package that they have in Germany, we on this side will vote for it. I put that proposal; perhaps the Government would like to agree to it.
Finally, there is a trend in Britain today, whether or not it is being deliberately promulgated—that makes it sound like some sort of conspiracy theory, but I do not go in for conspiracy theories because we are often at the receiving end of them. But if there has been an increase in self-employment, it is hard to reconcile with the idea that it is very difficult to be self-employed now because of all the red tape. Anyway, on one side there has been a vast increase in self-employment, if we can get our brains around that. On the other side, there are a number of people who do not have contracts of employment. That is partly a question of whether, ex hypothesi, in a static labour market there are a greater number of people in work. But on the employed side of the labour market, which is the vast majority, the quality of the contracts of employment is being reduced bit by bit.
One of the great advances since the war has been to improve the quality and content of the contract of employment. If you were to interview a random group of self-employed people and a random group of people with good contracts of employment, a lot of people who are self-employed would turn out to have some sort of relation to the employed but with a subcontract in the middle whereby they are not really self-employed—they are on something which does not give them a contract of employment with four weeks paid holiday and all the rest of it. Will the Minister therefore comment on the fact that it is very desirable that the good-quality contract of employment terms are a benchmark for the self-employed, and that this is not a further means of endeavouring gradually to wear away a benchmark on which we in this country have always been able to rely?
Lord Jordan (Lab)
My Lords, the Health and Safety at Work etc. Act 1974 transformed the safety landscape for all people at work. For the first time, it told everyone at work, “You are responsible for safety”. The Government’s proposals concerning the self-employed are a step backwards, telling some people, “Don’t worry, you are not responsible if someone gets hurt”.
Those who know the world of work are telling the Government that they have got it wrong. The Government have told them that the cost of regulation will be reduced, but they know that the cost of regulation pales into insignificance against the cost of accidents. The CBI and the EEF know it and, as my noble friend Lord McKenzie said, have both told the Government that the self-employed exemption in its current form is not fit for purpose.
What will be the cost of ignoring the significant warning of Professor Löfstedt? He is worth quoting, because he has analysed the possibilities. He has said:
“The danger with the proposed list is that self-employed individuals who are not on it will be exempt even if the jobs that these individuals do are in actual fact rather dangerous and unsafe. In other words the proposed Government list may increase injury and death in the workplace”.
The Government proposals, in their present form, will carry a cost: not in money, but in lives. This amendment will help to prevent that.
The Earl of Lindsay (Con)
My Lords, I should declare an interest as being the chairman of the United Kingdom Accreditation Service, because it is from that perspective that I want to speak to the noble Lord’s amendment. It is by virtue of that role that I am familiar with the intentions of Professor Löfstedt when he compiled his report and with the concerns that lie behind the amendment. Equally, I am familiar also with the thinking that has gone into the way in which the Bill, and particularly this clause, are drafted.
I firmly believe that accredited certification of occupational health and safety management systems could support almost every scenario. It could certainly support and benefit the status quo; it could certainly support and benefit the approach that Professor Löfstedt has proposed, which is one of positive exclusions. Equally, and probably importantly in terms of the House’s consideration of this amendment, it could also support and benefit the clause in terms of positive inclusions.
Accredited certification can provide the regulator with an authoritative assurance that the businesses concerned have good health and safety policies, procedures and controls in place. It allows organisations to earn recognition for their efforts to manage their own health and safety obligations. Accredited certification could act as a safety net for those industries, businesses and professions which may be excluded from the Act. In other words, if in doubt whether a business, profession or an industry should be within the ambit of the Act, one can safely err on the side of deregulation by putting in place a system of voluntary or mandatory accredited certification to underpin safety standards.
The accredited certification would be carried out against the recognised standard for occupational health and safety management—that is, BS OHSAS 18001—which is soon to become more formally recognised by the international standards organisation through its adoption as ISO 45001. The certification bodies would need to be accredited by the United Kingdom Accreditation Service, ensuring their competence to carry out the certification.
There may be concerns that a management system approach may not be suitable for very small businesses. However, the standard is flexible enough to be adopted by all sizes of organisation. Alternatively, size limits could be introduced whereby all businesses in a sector above a certain threshold would be required to comply.
Certification to BS OHSAS 18001 is now widely available in the United Kingdom. Some 40 certification bodies are accredited by the United Kingdom Accreditation Service to offer certification to the standard. It is estimated that more than 10,000 businesses are now certified as complying with the standard, and that figure is growing.
BS OHSAS 18001 was developed by a range of organisations specialising in health and safety management, certification and end-user businesses. It was co-ordinated by the British Standards Institution, the national standards body for the UK. The standard would bring immediate benefit in workplace safety to the status quo. It would bring benefit to the approach that Professor Löfstedt proposed. Most importantly, it would certainly benefit and support Clause 1.
Lord Wallace of Saltaire (LD)
My Lords, this clause has emerged out of a series of consultations during the past four years. As the noble Lord, Lord McKenzie, remarked in his very detailed and constructive speech, the first consultation took place in 2012 on the principle that there should be a list of undertakings prescribed in regulations that are excluded from health and safety law. That did not find large favour in the consultation. The most recent consultation has not found very large favour for the Government’s current proposals. We are finding it difficult to satisfy all those concerned. I note that the noble Lord did not quote the Federation of Small Businesses’ response to the current consultation, which is a good deal more favourable that those that he did quote. On the question of the current consultation, it took a certain amount of time; we had a lot of responses to the consultation and we had to put them all together. It has now been published and the Government will, of course, consult and consider what their response should be. We very much hope that we will have time to consult further and return to this issue before we get to Third Reading.
The Health and Safety Executive has, of course, been actively engaged in this entire process over the last four years; I stress that it is very much part of the process of policy-making. We all share the underlying purpose, which is as it should be, as the noble Lord, Lord McKenzie, suggested in his speech, a lessening of health and safety burdens on those self-employed who are not at risk and are highly unlikely to put others at risk from their activities. That is what Professor Löfstedt suggested in his earlier report; it is part of the German system. To the noble Lord, Lord Lea, I say in passing that there are many parts of the German system of employment, training and employment protection that we would very much like to take on board. I am happy that this Government have indeed taken us a good deal further down the road towards apprenticeship training than their predecessors. There are other aspects—including some aspects of the Meister system, now that I have begun to understand that—which are clearly restrictions on trade and which we do not wish to follow. However, one cannot ever take an entire model from one country and put it into another.
There are other areas over which I have spent some time arguing with German policymakers over the years; the idea that, just because a system has worked since the 14th century, one should maintain it at all costs, is not always an idea that one wishes to promote. I was one of those involved in the British side of the argument over the Reinheitsgebot, which the noble Lord might remember. It was to do with the purity of beer and was passed in about 1351. However, we will leave the German dimension aside and return to the current issue. We apologise that the consultation document has only just appeared. The Government will respond as soon as we are ready and we hope that we will have more to say on this before we reach Third Reading.
The issue at stake is which side one takes in reducing the burden, and whether to make a list of those, as this proposal suggests, whose activities are at greater risk of putting others in harm’s way from the way they are conducted—those involved in construction or a range of other activities that involve interaction with others. Professor Löfstedt prefers a system in which there is only a prescribed list of those activities that are exempted from the current health and safety regulations. The argument that we have been having through two series of consultation has been about how one defines “low risk” and “high risk”. This is an area, after all, on which one can spend a great deal of time, having a large number of consultations without meeting consensus. I regret that we have not yet reached an entire consensus.
The noble Lord’s first proposed amendment reverses the effect of Clause 1, so that all self-employed persons continue to owe a duty under Section 3(2) of the Health and Safety at Work etc. Act unless regulations are made to exempt them from that law, whereas the Government’s proposals exempt them unless they are on another prescribed list. This approach, we argue, would increase confusion for the self-employed because there are a plethora of low-risk activities that would need to be captured to ensure that the regulations were as extensive as possible. Furthermore, each of these activities would need to be appropriately and carefully defined. This could create further uncertainty in the law and make it unwieldy for the self-employed to comply with. This is part of what the Federation of Small Business was saying in its response to the current consultation.
The noble Lord’s second amendment seeks to impose various conditions upon the making of regulations before self-employed persons can be exempt from Section 3(2) of the Health and Safety at Work etc. Act 1974. The amendment would require an independent review to be conducted and considered by both Houses before the regulations can be brought into force. We do not consider this necessary. The Government amended Clause 1 in Committee so that regulations made under the power that it creates are subject to the affirmative resolution procedure before they come into force. This provides Parliament with an adequate opportunity to scrutinise and debate the list of prescribed activities to ensure they are fit for purpose.
The conditions which the noble Lord seeks to impose on the regulations can already be considered by both Houses as part of the affirmative resolution procedure if, indeed, Parliament considers those factors to be relevant. Additionally, the proposed prescribing regulations contain a commitment for their review and for a report to be published after five years of making them. That report will seek to assess the extent to which the intended objectives of the proposed change have been met. Given the safeguards already in place, the Government do not consider that a further independent review of this alternative proposal would be of any benefit.
It is imperative that self-employed persons, especially those involved in conducting high-risk activities, understand when health and safety law will continue to apply to them after this legislative amendment is made. For the reasons I have already given, we do not consider the noble Lord’s amendments to be the best way of achieving that. They are unnecessary and overly burdensome. After all, the purpose of the Bill is to reduce unnecessary burdens. The clearest and simplest way to achieve this change is by having a list of prescribed high-risk undertakings together with guidance produced by the Health and Safety Executive which will make it clear and unambiguous to those who continue to owe a duty under the Health and Safety at Work etc. Act.
I repeat: the Government are currently considering the comments just received following the 2014 consultation on the draft regulations already produced. These raise a number of important issues which the Government will consider further before Third Reading. In that context, I hope the noble Lord will feel able to withdraw his amendment.
Lord McKenzie of Luton
My Lords, I thank noble Lords who contributed to this short debate. My noble friend Lady Donaghy put the matter straight about Professor Löfstedt’s views. My noble friend Lord Lea spoke about the danger of building proposals on perceptions rather than proper evidence. I thank my noble friend Lord Jordan for providing the historical context of health and safety, and the cost when it goes wrong. The noble Earl, Lord Lindsay, broadened the debate a bit around the accreditation processes. I am sure we would have scope for a fuller debate around that issue. As I understand it, he argued that its application could be to an inclusive, exclusive or status quo proposition.
I understand that the Government are finding it difficult to get this right. That is why two rounds of consultation have not succeeded in doing that. We argue, given the complexities and difficulties in trying to get it right, that leaving it as it is would be the far better option.
Lord Wallace of Saltaire
I should point out that the first consultation did not provide much support for the noble Lord’s amendment. The second consultation criticised the Government. I merely remark that we are struggling in this area. That is, of course, why we are considering it further.
Lord McKenzie of Luton
I am not sure that the noble Lord’s assertion about the first consultation not supporting our position is right. It does not necessarily depend upon a prescribed list of any sort. The key point about our amendments is that they are linked to clear criteria that have to be satisfied before any change could be introduced. There are criteria around not increasing burdens and bureaucracy, representing demonstrable improvement on existing legislative requirements, and clarity and precision as to whom they apply. The two amendments sit together. The consultation that has just been gone through proves how difficult it is to have a list of high-risk activities. I struggle to understand what changes the Government could make to that process or outcome to make it fit for purpose. That is not just my view; it is the view of a raft of people who know health and safety and business far better than I do, the CBI included.
Lord Wallace of Saltaire
I only had a chance to read the consultation document on Friday and we are at a very early stage on that so it is very difficult to say precisely what we will conclude. I merely wish to say in the most constructive way possible that we are considering our response. We have three weeks before Third Reading and that gives us some time to consider further.
Lord McKenzie of Luton
I am grateful for that—and I meant Third Reading, of course, not Report. Is the noble Lord saying that we will have a chance possibly for some discussions in the interim and, if not, a chance to consider this further when we get to Third Reading? It is quite important that we have that commitment from the Government on the record, whichever stage it reaches.
Lord Wallace of Saltaire
My Lords, of course I am very happy to discuss this between now and Third Reading. I am not in a position to say what the Government will conclude from their consideration of the current consultation document because we are at a very early stage, but I am very happy to promise to consult further.
Lord McKenzie of Luton
My Lords, I am not quite sure why the Government are so pressed on this matter because that consultation finished some five months ago. I note that the Minister has been less than clear on whether, if we are not satisfied with what happens in the interim, we would be able to return with amendments at Third Reading. It would be helpful if the Minister could give me an assurance that he would facilitate that; if he cannot, we have another decision to make.
Lord Wallace of Saltaire
I recognise what the noble Lord is asking me to do. At this stage, I am afraid I cannot give him the absolute assurance he requires, but I am certainly willing to have further consultations, and the Government will be very happy to carry on on that basis.
Lord McKenzie of Luton
The Minister is not making it easy. I know it is not his job to make it easy. We are trying to see a way forward to avoid voting prematurely, in a sense, if the issue has not been completed. If the Minister is saying that he would be happy for us to come back at Third Reading with a proposition, if we need it, depending on what the Government do in the mean time, that would be helpful. If he is saying that he thinks that the processes in the Companion would preclude that, then we have another decision to make.
Lord Wallace of Saltaire
My Lords, the clerks are nodding. That suggests it would entirely open after consultation for the Opposition to come back again on this issue.
Lord McKenzie of Luton
I am grateful to the Minister and to the clerks for nodding, in which case I beg leave to withdraw the amendment—but with notice that we look to return to it at Third Reading.
Lord Low of Dalston
Lord Low of Dalston (CB)
My Lords, I shall move Amendment 3—which is in my name and the names of the noble Lords, Lord Lester and Lord Hunt, and the noble Baroness, Lady Thornton—in the absence and at the request of the noble Lord, Lord Lester, who is currently recovering from heart surgery. I am glad to be able to report that he is doing well, but there would be no better “Get well soon” message that we could send him than to accept his amendment today.
Clause 2 amends Section 124 of the Equality Act 2010 to remove the power of employment tribunals to make recommendations to employers in cases where there has been a finding of unlawful discrimination, harassment or victimisation but the claimant no longer works for the employer. These are commonly referred to as “wider recommendations”. Its effect will be that, in future, an employment tribunal will be able to make a recommendation aimed at preventing or reducing the adverse effect of the discrimination on only the claimant in the particular case. In 2013, a BIS survey of employment tribunal applications found that only 16% of claimants in discrimination claims were still working for the employer against which they made their claim. This means that the effect of Clause 2 will be that in 84% of discrimination cases the employment tribunal will no longer have power to make recommendations to employers to take steps to improve their practices to avoid discriminating against other employees. This will be a significant reduction in the powers of employment tribunals.
Amendment 3 would remove the provision in the Bill which takes this power away from tribunals, thus preserving employment tribunals’ current power to make wider recommendations following a finding of unlawful discrimination. The power to make wider recommendations is of strategic importance for employees and employers. So far as employees are concerned, even when, as in the great majority of discrimination cases, the employment relationship has broken down and the employee has left the employer’s employment, they can help prevent or reduce future discrimination and are an effective way of tackling systemic issues and practices. So far as employers are concerned, recommendations are an important way of helping employers who have discriminated to improve their practice. An employment tribunal hears evidence about the circumstances in which the unlawful discrimination occurred and is thus well placed to identify steps the employer can take to rectify any discriminatory practices. Recommendations also offer an important means by which employers can learn from their mistakes and help avoid future discrimination claims.
The power to make wider recommendations is criticised on four grounds: first, that they impose a burden on employers; secondly, that the power is little used; thirdly, that there is no evidence that wider recommendations are effective in changing employers’ practices; and, fourthly, that there is no means of enforcing wider recommendations.
As regards burden, the impact analysis attached to the Government’s consultation on reform of enforcement provisions in discrimination cases suggested that this provision, when operating as expected, will affect only between 0% and 3% of employment tribunal cases, which, it suggests, is likely to result in 17 cases a year. It is hard to maintain that this will constitute an undue burden on employers and business. Moreover, by limiting the cases in which wider recommendations could be made to those where the discrimination, harassment or victimisation has a serious adverse effect on persons other than the person bringing the claim, Amendment 3 addresses criticisms that the wider recommendations power imposes a disproportionate burden on business.
On the point that the power is little used, perhaps it is too early to tell, as it has existed only since 2010. However, on the basis of a review of over 400 employment tribunal judgments issued between December 2012 and September 2014, the Equality and Human Rights Commission concluded:
“Given the benefits to employers and employees which can result from wider recommendations, concerns that the power is little used should be addressed by encouraging employment tribunals to actively consider whether a wider recommendation should be made … not by removing the power”,
entirely.
As regards effectiveness, recommendations mainly concern the provision of training for managers and a review of policies or procedures. I might draw attention to a number of cases, but in order not to detain your Lordships too long I will mention just a couple. One case concerned where a disabled woman was denied a reasonable adjustment that should have been made for her. The employment tribunal ordered that within six months,
“line managers and human resources are to receive adequate training on understanding and implementing the Respondent’s disability leave policy and to ensure that the policy is properly communicated to employees as is appropriate in the circumstances”.
In another case, the Ministry of Defence was found liable for both direct and indirect discrimination in its handling of the promotion prospects of an RAF group captain. The employment tribunal commented that it was shocked that senior personnel were not fully competent in, nor apparently had they been trained on, codes of practice in respect of the Equality Act or the predecessor legislation. The tribunal made a number of recommendations including: first, that all personnel involved in promotion and recruitment should have training in equality and diversity as set out in the Equality Act and the code of practice; secondly, that decisions of the appointments and promotions board should be recorded in writing, with reasons clearly explained and these should be retained for at least 12 months; and, thirdly, that the resolution of the service complaints procedure should not be unilaterally suspended pending the outcome of an employment tribunal complaint. I submit that those are not inappropriate recommendations for an employment tribunal to make with a view to improving the employment practice of the employers with whom it is concerned, and that the effectiveness of its decision would be substantially diminished if it did not have the power to make such recommendations.
On enforcement, it is perfectly true that the employment tribunal does not have power directly to enforce the carrying out of wider recommendations. However, the Equality and Human Rights Commission reviews all employment tribunal cases where there have been findings against employers, prioritises cases where there have been wider recommendations and works with employers to secure the implementation of such recommendations.
Finally, it must be said that the Government’s approach on these matters is not entirely consistent. From 1 October 2014, the Equality Act 2010 (Equal Pay Audits) Regulations 2014 require an employment tribunal to order an employer who loses an equal pay claim to carry out an equal pay audit unless specified exemptions apply. These audits require, among other things, that employers develop an action plan, with a view to ensuring that they do not fall foul of equal pay policies in the future. I submit that this is the better approach, the right approach and the approach that should be similarly followed with regard to wider recommendations. Precisely the same considerations apply, and it is hard to see why tribunals should not have the sort of powers in relation to the making of wider recommendations that they have in relation to the ordering of equal pay audits.
This matter was considered in Committee when an amendment to delete Clause 2 entirely was judged an amendment too far and was rejected. However, I submit that the more surgically crafted amendment of the noble Lord, Lord Lester, deals with the issue that we are considering in a more proportionate way and, as such, is deserving of your Lordships’ approval. I beg to move.
Lord Hunt of Wirral (Con)
My Lords, I declare my interest as vice-chair of the All-Party Parliamentary Group on Equalities and the other interests recorded in the register. I am sure that the whole House will join the noble Lord, Lord Low of Dalston, in sending our very best wishes to my noble friend Lord Lester of Herne Hill as he recovers from surgery. My thanks are redoubled because my participation in this debate was demanded by my noble friend, who pointed out to me what I had said in the debate on the Equality Bill in 2010. Some of your Lordships may wish that their words were not so remembered, but the encyclopaedic mind of my noble friend Lord Lester suddenly pointed out to me—in these words, I think—that, “Our Government are doing something the opposite of which you argued so forcefully in 2010”. He reminded me that I had urged then that,
“not only should due regard be paid to eliminating discrimination but that there should be a much more proactive element”.—[Official Report, 27/1/10; col. 1492.]
I spoke on what is now section 124 of the Equality Act 2010, when, as shadow Chancellor of the Duchy of Lancaster, I pointed out the deficiencies in the then clause.
In many ways, the noble Lord, Lord Low of Dalston, has just repeated what I felt was a brilliant summary of the criticism of Clause 124, expressed by both government and business representatives. He gave four telling points. Against that background, I can well understand why my noble friend wishes to remove the power of employment tribunals to make recommendations to employers and other respondents in cases where there has been a finding of unlawful discrimination, harassment or victimisation but where the claimant no longer works for the employer.
There is a better way, which I tried to suggest at the time to the Labour Government, but, sadly, they refused to listen on that occasion; I hope that the Opposition are listening carefully now. We need to retain but clarify the power in Section 124. I very much hope that noble Lords will agree that there is a need for reform rather than abolition. Those are the circumstances in which I put my name to the amendment tabled by my noble friend Lord Lester of Herne Hill.
There are, however, problems. Undoubtedly, this was discovered by the then Labour Government. I think that the noble Baroness, Lady Royall, dealt with the matter from the Government Benches at that stage. As the equality and diversity commission has pointed out, this amendment could lead to a tribunal having to hear additional evidence and argument in order to decide whether the adverse effect of the discrimination on those other than the employee bringing the case was serious. I have no wish to cause such complications.
My noble friend has already proved himself to be so amenable that I think that the noble Lord, Lord McKenzie, has gone away to recover, as I cannot see him in the Chamber. My noble friend, assisted by the clerks—who I hope might assist us once again—bent over backwards in trying to find out how Section 124 could be further improved, particularly to avoid the risk I mentioned and to address the criticisms—those four key issues—which have been so clearly set out. The noble Lord, Lord Low of Dalston, sought to deal with them, but the criticisms remain. They concern the way in which the wider recommendations power has been used to date and its effect on businesses. One way to tackle the issue would be to limit the power of the tribunal so that it cannot recommend a respondent to take steps which are disproportionate. The commission has suggested that that might be a way forward. It also recommends that Section 124 be improved by making a failure to comply without reasonable excuse an unlawful act for the purposes of the Equality Act 2006.
In previous debates, I have urged that a clear enforcement mechanism should be introduced. I repeat what I said in the Chamber on a previous occasion, as these words were repeated to me by the noble Lord, Lord Lester. Speaking from the Conservative Benches, I said:
“Of course we believe that the provisions must be enforceable. If an organisation has been acting illegally and subverting the equality provisions, it should have to obey the recommendations”.—[Official Report, 27/1/2010; col. 1470.]
Of course, the Government did not pay attention. The noble Baroness, Lady Royall, said that it would be inappropriate to introduce enforcement powers. However, we have to think about introducing to or leaving on the statute book a power with no enforcement mechanism at all. I hope, therefore, that my noble friend will come forward with the answer. I can hardly wait to hear his speech.
Lord Beecham (Lab)
My Lords, first, I endorse very warmly the amendment moved by the noble Lord, Lord Low, and supported by the noble Lord, Lord Hunt. They make a powerful case. I hope that, after also hearing from my noble friend Lady Thornton, the Minister will be persuaded to give some ground, as what they say is very compelling indeed. However, this may be a little academic given the fact that there has been an 80% reduction in the number of cases brought to employment tribunals since the charges were imposed by the Government last year. It seems to me that we are seeing the whole system being rather rapidly eroded. I hope that the Minister, in reporting back to his colleagues about the outcome of this debate, whatever it may be, will invite them to look again at the status of employment tribunals, and the great reduction in cases being brought, to see whether they intend to allow this nearly 50 year-old provision to wither on the vine, because that is the impression that is being widely—and, I think, rightly—inferred from the history of what has happened over the past year or 18 months.
Baroness Thornton (Lab)
My Lords, it is very nice to be back discussing equalities matters opposite the noble Lord, Lord Hunt. He did a brilliant job helping to put the Equality Act 2010 on the statute book. We were very pleased to work with him at that time. I join the noble Lords, Lord Low and Lord Hunt, in wishing the noble Lord, Lord Lester, better and well for the future.
The noble Lords, Lord Low and Lord Hunt, have explained perfectly well what the issue is: in future an employment tribunal would only be able to make a recommendation aimed at preventing or reducing the adverse effect of the discrimination on the claimant in the case. That would mean that the potential to reduce discrimination against the employer’s wider workforce would be lost in the majority of cases. The EHRC has powers of enforcement on employment tribunal decisions. It was very clear on this in its evidence to the Joint Committee scrutinising the Bill. It said that it strongly disagreed,
“with the proposal to remove employment tribunals’ wider recommendation making powers”.
It said that,
“it is too early to judge the effectiveness of the power which has been in force only over the last three years. The available evidence suggests that the power has been used proportionately, and that there are important clear benefits for all concerned (including employers and employees) in exercising the power to clarify necessary remedial action, and this helps to prevent further discrimination and to reduce litigation”.
This power has not been in place long enough for evidence to suggest that it is either a burden on business or not effective enough. Those are both arguments that the Minister has used in the course of these discussions.
On these Benches, we regard these amendments as very important. We believe that we have to continue to address the concern that the law should be effective not only in providing redress for victims of unlawful discrimination, harassment and victimisation, but in preventing those unlawful acts from occurring, and in helping employers to comply with their duties. I will give one example that illustrates very well the importance of this law. Last year, the Metropolitan Police had to pay a female firearms officer who featured in Scotland Yard’s Olympic poster campaign damages of £37,000. Those damages were levied by an employment tribunal after she was bullied and victimised for being black. The tribunal branded Scotland Yard as “malicious” and “vindictive” in its treatment of Ms Howard and told the Met to review all internal complaints of discrimination made since 2009. I stress that. I have no idea whether the Met has carried out and complied with that recommendation. I hope that it has and that it is taking remedial action, because it was heavily criticised at the time.
The point is that the tribunal’s power to make these wider recommendations is under threat from the Deregulation Bill. If the Minister wants to take this amendment away and come back that is fine with us. But this is very important and I think that it is the right thing to do.
Lord Wallace of Saltaire
My Lords, the Minister is not going to take this amendment away and come back. It is a very kind offer to make. We had an extensive discussion on this clause in Committee. The Committee voted by quite a substantial majority to retain it. What we have here is an amendment that is offered as a compromise but which seems to the Government to make the situation a good deal more complicated.
What we have in Clause 2 at the moment is a straightforward repeal of the requirement on tribunals to offer non-enforceable recommendations on wider issues. It does not reduce or abolish the right of tribunals to offer comments on particular cases and it certainly does not lower what they can do in this overall area. It does, however, simplify the position. By contrast, the amendment offered by the noble Lords, Lord Lester and Lord Hunt, would lead, we argue, to a more complicated system for tribunal recommendations. It would reduce the protection for claimants and set up more complex arrangements for tribunals. It would allow a tribunal to make a recommendation if it thought that it would completely obviate—not just reduce—the adverse effects evident from the case. That is a much higher standard of proof for the complainant than we require under the present system or that would be required following the repeal.
I will comment briefly on the general issue from the Equality Act. This was intended by the Government to be a light-touch element in the very large number of tribunal cases. I understand that there have been around 1 million employment tribunal cases in total, of which around 10%—100,000—were discrimination cases. Some 3,000 of these discrimination cases were successful and in 40 of them there were recommendations. Therefore, we are talking about a very small number. The range of recommendations includes the question of equal pay where there is a requirement for equal pay audits, which is enforceable. An equal pay audit ordered by an employment tribunal is a precise and mandatory requirement with sanctions for non-compliance to advance equal pay in the small number of organisations where a breach of equal pay law has been found and it is also a direct transparency measure as it has to be published.
By contrast, wider recommendations in discrimination cases are effectively discretionary for employers and do not have to be made where an employer loses a discrimination case. Wider recommendations are generally broad-brush proposals; for example, a recommendation that human resources staff undergo equalities awareness training. These are non-enforceable recommendations about training, company culture or a range of other areas that are made by tribunals that may not themselves be very closely aware of the culture of the companies concerned. They are recommendations from the outside.
The noble Lord, Lord Hunt, suggested that, although the amendment is in some ways defective, he would like the Government to take it away and improve it. The amendment, even if modified as the noble Lord proposes, would, in our opinion, result in a quite complex and heavy set of requirements. These could mean, for example, that tribunals might be required to consider wider recommendations in a very large number of cases while quite minor omissions by employers, such as failing to train a manager or to update a diversity statement, could become unlawful acts under equality law. I regret, therefore, that the Government have to decline the invitation to take this away and improve the quality of the amendment.
Our repeal will not prevent tribunals from making non-binding observations on employers’ practices. These could reasonably include the type of points mentioned by the noble Lord, Lord Low, in specific cases. For all employers, losing a tribunal case and having to pay compensation, which our repeal will not affect, itself concentrates employers’ minds and persuades them to learn from their mistakes. The lack of enforcement already there means that they have to take them into account.
The noble Lord, Lord Hunt of Wirral, also talked about introducing the word “proportionate” into the legislation. As someone who struggled in the EU balance of competences review to define “proportionate”, I am conscious that it opens a large door to lawyers and that it is very difficult to discover precisely what proportionality means.
The noble Lord, Lord Beecham, raised the question of the introduction of fees and I recognise that that is of course a serious point. He will in turn recognise that the Government are struggling to contain public expenditure. It is important to emphasise that the Government have been careful to ensure that fee waivers are available for people of limited means in order that they are not excluded from seeking redress in tribunals. The Government have committed to reviewing the introduction of fees, although of course it will be for the Government after the next election to take on that review. We are considering the scope and timing of the review and will bring forward our plans in due course.
I hope that that provides sufficient information to persuade the noble Lord, Lord Low, to withdraw the amendment. The House did support the Government’s repeal proposal at Committee stage last autumn and I stress that we proposed a straightforward repeal of an unenforceable power that creates a perception of burden and unfairness.
Lord Low of Dalston
My Lords, I am grateful to the Minister for his reply and I am grateful to all those who have spoken, especially to the noble Lord, Lord Hunt of Wirral, who I thought went out of his way to suggest ways in which there might be a meeting of minds between the proposers of the amendment and the Government. I am sorry that the Minister is not prepared to respond more flexibly to the invitation from the noble Lord, Lord Hunt, to be flexible, which I am afraid does not give us a lot of room for flexibility on our part, although we might well have shown it had the Minister agreed to accede to the suggestion made by the noble Lord to make time for a further look at the amendment.
The Minister said that this is intended to be only a light-touch measure. I cannot see how more light touch it could possibly be. He gave us the statistics showing that there were 1 million tribunal cases over the period he referred to, of which 100,000 were discrimination cases. Some 3,000 of those cases were successful, and in only 40 cases were wider recommendations made. It is hard to see how this could be more light touch than that. You cannot say that the tribunals have been abusing this power.
The Minister went on to suggest that there is no need for such a power by dismissing as immaterial or unimportant the sort of cases in which it has been used. He said that it had been used in minor cases such as the failure of a company to train a manager. Well, I am not sure how much less minor it is possible to be than failing to train your managers properly. He also suggested that our amendment would make the situation worse. I cannot see that because it seeks simply to reinstate the position as arrived at in the Equality Act. It does not seek to be more draconian than that or more burdensome on employers. I think I showed in moving the amendment that it is hard to argue how the use of this power, as it has been used, constitutes a burden on business and employers.
No one in the House or even in the country is more expert on these matters than the noble Lord, Lord Lester, and I am sure that we are all extremely sorry that he is not able to be present today to give us the benefit of his wisdom. However, I am perfectly sure that he would not be moving an amendment of this kind if he did not think that it was a useful component of discrimination law and the light-touch enforcement thereof. In crafting it, the noble Lord sought to be compromising and to move a less drastic amendment than the complete removal of the clause as was attempted in Committee. This is a different approach. It is perfectly open to the House to support the amendment. It is not constrained in that matter by the discussions that took place in Committee. For all these reasons, I want to test the opinion of the House.
Baroness Thornton
“(e) the person who made the booking has consented to their booking being sub-contracted to a second operator.(1A) A licensing authority may exercise all its powers over a vehicle licensed as a private hire vehicle or taxi if it is operating in their area, even if the licence was issued by another licensing authority.”
Baroness Thornton
My Lords, these two amendments are both modest and simple. They concern consumer rights and customer safety. The right is that of the person booking a cab to know who will be turning up, whether it is the person whom they expect or someone else, that it is done with their knowledge and permission, and that if there is subcontracting, there is an audit trail of it. I would be grateful if the Minister could explain how many subcontracts might take place in one order for a cab and how that might be recorded.
The amendments seek to mitigate the risk of subcontracting by requiring the consent of the hirer before a booking can be passed on. They also propose allowing a licensing authority to exercise its powers over a licensed private hire vehicle or taxi operating in its area, even if the licence was issued by another licensing authority.
We would have preferred the Government not to have proceeded at all with these clauses. There is still time for them to withdraw them, do the sensible thing and wait until the Law Commission’s full report can be taken forward instead of the pick and mix approach, which we believe is not based on what is safe and what is best for customers. We believe that customer safety could be undermined as, currently, only the licensing officers from the licensing authority where a vehicle and driver are registered have the power to take enforcement action.
In Committee, the Minister suggested that these Benches were against reform. That is not so. We are very much in favour of accessibility. More taxis being available for everybody is a good thing, particularly for those who are disabled. It is about how that is done. We on these Benches are not alone in our worries. Indeed, the Secretary of State for Transport said on the radio over the weekend:
“One of the things the Government has done is ask the Law Commission to look at the whole issue of licensing taxis and it is something that they have reported to us on and the Government are due to respond shortly. It will probably need, will need, almost certainly need primary legislation”.
The Minister for Transport, Claire Perry MP, held a seminar on increasing safety for women on public transport on 20 January. She said:
“The Department for Transport makes personal safety considerations a part of”—
in this case—
“all future rail franchise awards”.
We agree with her and, indeed, the Secretary of State.
Can the Minister assure the House that the same test of personal safety has been applied to these deregulatory reforms for taxis? If she cannot, I hope that she will consider accepting the amendments or bringing forward some of her own that do so. If she again prays in aid, as she did in Committee, that this is a similar regime to that which operates in London, I will ask her to consider that there were more than 111 rapes and sexual assaults between October 2011 and April 2013 where the indicated offender was a taxi or private hire driver in London. The Brighton and Hove taxi companies wrote to us and were vociferous in their opposition to this proposal. They say:
“Please can we move away from the pious, myth-making NONSENSE that the London Taxi system is the best in the world”,
and point out that it is as much in need of the reforms proposed by the Law Commission as the rest of the country. They also point out that there were three assaults in the same period in the whole of Sussex.
The Law Commission has recommended that licensing authorities have the power to enforce standards in respect of out-of-area vehicles, which would be crucial for safety. The public, particularly vulnerable passengers such as women or disabled people, may call specific operators because they feel that that operator is both reliable and safe to travel with. This reform means that the public will lose the right to choose which operator they travel with, if someone calls operator A—their preferred choice—and operator B turns up. Amendment 4 stipulates that an operator must have the consent of the person making the booking before their booking is subcontracted and that there will be cross-border reinforcement. Indeed, in a letter from the Minister in December 2014 to Bryan Roland of the National Private Hire Association, she suggested that the Government were already thinking about this matter. I do not know the outcome of that thinking, but I sincerely hope that we are pushing at an open door here.
Noble Lords may have received a brief, as I did, from the Licensed Private Hire Association, which states:
“The Suzy Lamplugh Trust, (The Safety Charity who campaigned for Licensing in London alongside the LPHCA) agreed that restrictions on the ability to subcontract were inappropriate”.
It goes on to state:
“This was agreed by Sir George Young, Minister Glenda Jackson and Dr Jenny Tonge from the main parties”.
Leaving aside the promotion of my honourable friend Glenda Jackson MP, I asked the Suzy Lamplugh Trust for its view on this matter. This is what it said to me today:
“As a trust we have no objection to the principle behind the aims of this clause”—
I agree with that—
“often a risk to the public’s personal safety is a lack of safe transport, and any measure introduced to alleviate that is welcome”.
That is absolutely right. It continues:
“However under current regulation a licensing authority does not have the enforcement powers of vehicles and drivers operating outside their licensed area. The Law Commission’s report, published after these clauses were added to the Deregulation Bill, proposed extending the enforcement powers of all licensing authorities to deal with vehicles and drivers licensed in different areas. The proposals made under Clause 12 have not been made in conjunction with the Law Commission’s recommendations and therefore do not make adequate provision to allow licensing authorities to ensure the safety and practice of their drivers. Until there is a proposal to extend these powers and to introduce and enforce a robust audit trail to ensure the ability to trace bookings and their journeys we will be unable to support the proposal”.
Lord Deben (Con)
My Lords, it is in the knowledge of this House that I very often find myself on the same side as the noble Baroness, but on this occasion I suggest that she is wrong, because she is unbelievably out of date. A good deal in this Bill is out of date as far as what is happening to the private hire and taxi business. One would have thought, from these amendments, that modern technology had not ever entered into the world. If you travel by certain companies, which shall be nameless, you are safer than you have ever been before, because they know exactly who you are, exactly who the driver is and exactly what the route is, and they can check these things. That makes people much safer. They do that without any regulation at all, without any local authority and without any of the people who know best entering into the discussion.
It is called the market. It works extremely well and it is much safer. I just hope that my noble friend will not be moved from the current situation, except perhaps to remind those who wrote this part of the Bill that it is already out of date because the technology has moved on. That does not mean that I am not entirely supportive of it, because it is better than what went before. But these are old fashioned proposals that have been put down as amendments. They will not achieve what they suggest, and it would be good if we could be a bit more digitally savvy when we come to find a way through the clear issue that the noble Baroness has put forward, which is the real desire to protect passengers—women in particular, but not just women—from the dangers that arise. I just wish that we did not sound a bit as if we did not know what was happening in the world outside.
Baroness Howarth of Breckland (CB)
My Lords, I do not think that the noble Lord lives in the same world that I do, where many people are not digitally savvy. In some rural places in the north, they travel in taxis which appear out of the blue and feel extremely unsafe. I say that before saying to the noble Baroness that I hope this is not a matter of political process. I hope it is something where we think about those things which matter to this Government, which are safety and choice. I know that choice means that you have a range of options—I think that the noble Lord was indicating that we are moving towards that—but should we not wait for the Law Commission’s report, so that issues such as changes in digital technology can be taken on board and that we might recognise that the situation is not the same right across the country?
In many of my roles, I travel all over the UK in taxis. When I choose to travel by a taxi, as a consumer I expect that what I telephone for will turn up. Having worked in the vulnerable adult and child protection area for many years, I know that alternatives might turn up in which I or the child whom I want to be transported might well not be safe. We want to be absolutely sure when we make such a choice—as simple consumers, we have a right—that what we have asked for turns up at the door or we know that it is an alternative so that we can make an alternative choice.
Equally high on the agenda is safety, particularly as we have had so many situations up and down the country, and we await reviews and more inquiries about the protection of children and vulnerable adults. This is a measure where you could really make a difference and listen and look again at these issues, rather than looking at it simply as a deregulation issue.
The Minister said earlier that this legislation is about getting rid of unnecessary burdens. I absolutely agree, having worked in a number of fields where there are such unnecessary burdens, but I do not think that this proposal is either unnecessary or burdensome. It is quite straightforward that if people want to provide a service they should be licensed.
The noble Baroness mentioned the situation in Rotherham, the report on which highlighted significant concerns in relation to taxis. That is quite recent—so the world out there is not safe. We have also had reports that many disabled and elderly people find it very difficult to deal with digital technology. Where I come from, in a large rural area, the only way of travel for some disabled and elderly people to their hospital appointment or somewhere else is by taxi because the bus comes twice a week. It is not a luxury; it is an essential way of travelling. They want to know that the taxi that turns up at their door is a taxi in which they will feel safe. Even if the contractor is safe, we know the anxieties that elderly, disabled and sick people have in terms of looking after themselves. Therefore, they have to be absolutely safe.
I only hope that if we have another child abuse inquiry, or an inquiry where something has happened to a vulnerable adult—God forbid, but that is the world out there—the Government will not find themselves in difficulty because they failed to take note of these voices of caution. It is only caution, because there are ways of thinking through this matter so that we do not reduce the capacity for business but we ensure that people are safe.
Lord Skelmersdale (Con)
My Lords, I regret that the noble Baroness, Lady Thornton, has not split this amendment into two parts, which it is quite possible to do, because I am fairly certain that a person who has made a booking would not on average ask the taxi company where the taxi was coming from. It may be that they envisage—rather like, I suspect, my noble friend Lord Deben—that, when they book a taxi online, they will get a questionnaire, one of the questions in which will be whether they consent to the taxi coming from another local authority area. That is all very well, but I live in Taunton—not Yorkshire, like the noble Baroness over there.
Lord Skelmersdale
Breckland, I apologise: the west, shall we say.
On occasions, I use taxis. I ring up—sometimes from a train, sometimes from London—and the taxi company says, “Yes, you will have a taxi arriving at 5.03, or whatever the time is, to meet your train”. Even when I get into that taxi, I do not know whether it comes from, say, Exeter, or rather closer in Devon, which is another local authority area. Quite honestly, I do not care. However, I care about the second part of the noble Baroness’s amendment, which says:
“A licensing authority may exercise all its powers over a vehicle licensed”,
in another area. In other words, I want my taxi to be safe: I do not want the wheel to fall off, the bumper to fall off or whatever it happens to be. To that extent, I go along with proposed new subsection (1A) in Amendment 4, but I cannot go along with proposed new subsection (1)(e).
Lord Harris of Haringey (Lab)
My Lords, the noble Lord, Lord Deben, in his stirring defence of the market and its role as a solution to all of the problems that occur, makes a compelling point. However, he also went on to talk about the changes that have happened because of new technology, suggesting that we therefore were safe as a consequence. We are only safer if the company holding and using that information is reputable and operates in a reputable fashion. In fact, you are opening up an enormous area of vulnerability because if somebody, for example, uses a particular firm where all this is electronically recorded, the precise movements are therefore on the record. If that firm is not responsible or, for example, does not maintain proper security, the vulnerable person is made even more vulnerable by that information being available. The noble Lord is of course right, under circumstances in which the company is reputable. There are enormous additional safeguards, because the precise route, the nature of the driver and everything else is on record; perhaps as a consumer, the person concerned has those data. However, that presupposes in the first instance that the company is reputable and has gone through an appropriate process.
Lord Deben
I entirely agree with the noble Lord. The point I am trying to make is that the very issue he is raising is covered neither by the Bill itself, nor by the amendment. It just makes us sound as if we are out of touch with what is actually happening. We ought, perhaps, to think again—not now, but in the future—about how to bring this into line with modern technology.
Lord Harris of Haringey
My Lords, the noble Lord, in his intervention, has made precisely the point I wanted to go into—that is, because these issues are not adequately addressed, the Government therefore need to think again. There is an opportunity to think again, because the Law Commission is looking at precisely this issue at the moment, but the Government, for reasons best known to themselves, have brought forward these proposals in advance of that Law Commission consideration. Surely the sensible thing, therefore, is for the Government to withdraw all these clauses so that we can wait for the Law Commission to come forward with clauses that would no doubt meet both the free market and the technological expectations that the noble Lord, Lord Deben, has.
At the moment, we are faced with a position where the Government are actually weakening the safeguards and are not recognising the context in which private hire firms are now operating. That is neither sensible nor acceptable, particularly if, by waiting for the Law Commission, we could have a more comprehensive and suitable solution.
The whole point about the subcontracting issue is that individuals assume—maybe they are naive to do so—that they are dealing with the firm whose number they know and are related to. They do not realise that that business could be passed on to somebody else. That might meet the needs of somebody getting off a train at 5.03, but it does not necessarily meet the needs of everybody. You at least should have the right to know that that has happened or the process that has taken place. That is why these amendments are important. Actually, the best thing of all would be for the Minister, when she replies, to say that the Government understand these issues and that perhaps what they are trying to do is not quite workable, then withdraw the clauses in their entirety at Third Reading—I do not suppose she could do that today—so that we can wait for the Law Commission to look at all these issues in the round.
Viscount Ridley (Con)
My Lords, I have great sympathy with what the noble Baroness, Lady Thornton, said about the need for people to feel safe in taxis, and with what the noble Lord, Lord Harris of Haringey, just said. However, I do not believe that the clauses weaken these aspects of the Bill. Clause 10 does not water down enforcement, policing or the responsibilities of local authorities. Local authorities can and do check the suitability of drivers. There is nothing to stop them sharing information with police. They do so already and they still will be able to do so. There is no change in the frequency of disclosure checks, for example.
As I said in Committee, it is worth bearing in mind that Clause 11 allows huge benefits from subcontracting for provincial taxi operators that are not available at the moment to taxis—except those in London. It allows better response times, reductions in dead mileage, subcontracting to trusted subcontractors when there is a sudden problem—in the event of a breakdown, for example—and more efficient deployment of vehicles. I gave examples in Committee of operators who must currently travel 50 miles to pick up someone to go two miles and then come all the way back again, and of vehicles that return empty from airports and hospitals, or that have to leave passengers in the lurch when there is a breakdown or accident outside their area.
All the subcontracting made possible in this clause is already possible for London. Operators are allowed to subcontract there. I do not see why it is not possible to make a level playing field. No one, not even the Suzy Lamplugh Trust or the Local Government Association, has suggested that there are peculiar problems arising in London as a result of subcontracting. Sure, there are problems in London, as elsewhere, but operators are still required to keep records so that there is an audit trail. Quite simply, it is already an offence to subcontract to an unlicensed operator. It is clear that there is an issue to be dealt with, but it is not dealt with by interfering with Clauses 10 and 11.
Lord Sutherland of Houndwood (CB)
My Lords, I understand the good sense of legislation taking account of the modern digital world in which we live. However, in the present context, relying on that for safety and security has two major problems. One has already been mentioned, that many older people—who are among the most vulnerable—are not particularly good at this. That is a generational thing that will change but it is the reality now. Secondly, we are talking, significantly, about areas of the countryside where—we are reminded once again today—there is not adequate digital provision. To assume that every house isolated in the countryside has a proper online service so that it can book taxis in this way rather than by the old, traditional method of telephone is simply a mistake—at the moment.
The Minister of State, Department for Transport (Baroness Kramer) (LD)
For a moment, I thought your Lordships would have a very enjoyable debate with no opportunity for me to speak. Let me start by responding to the issue of why we are moving clauses ahead of our response to the Law Commission and—undoubtedly, some time in the next Parliament—primary legislation dealing with the much broader issues of the changing world of private hire and taxis. That is a huge area and there is significant work yet to be done.
There are two reasons for going early with these clauses. The first is safety. I point out to the noble Baroness, Lady Thornton, that subcontracting within a licensing district is permitted for everybody and has been for years and we know of no issues arising from it. In London 10 years ago this place and the other place agreed to subcontracting across districts to help deal with the problem of unlicensed cab drivers behaving in a criminal way and putting the public at risk. The noble Baroness, Lady Thornton, gave some numbers for sexual assaults in London but the category she described included unlicensed drivers as well as taxi drivers and licensed private hire drivers. Unlicensed drivers have been the real problem within London. Permitting subcontracting so that someone calling up a company can be assured that a car will come and get them instead of being told, “Sorry all our cars are taken”, makes them far less tempted to get into an unlicensed cab crawling along the street attempting to get their business. That was the driver behind subcontracting in London and those who talk to people with experience of this in London will recognise that it has indeed been helpful in increasing safety. However, one sexual assault is always too many: we have to be vigilant and there is a great deal more to do.
One of the reasons I support moving ahead with this is my own experience of being out in more provincial areas, calling every number I could find for local taxi firms and finding not a single car available. This happened to me when I was going to visit a friend in a nursing home in a country area. I was very glad that it was not dark, that I was not standing there with several small children and that it was not pouring with rain because I think that had an unlicensed cab come by and offered me a lift I might well have been desperate enough to take it. That is not a situation we want. This measure is largely designed to make sure that there is a car available when someone calls a reputable licensed operator.
The other thing I want to clarify—I think there is real confusion over it—is subcontracting from an operator in one district to one in another district. Each operator has to be licensed in their own district and each of them can give the job only to a driver and a vehicle that are both licensed in their same area. So if you call an operator in District A and they give the job directly to a driver, both the driver and the vehicle have to be licensed within that area as well as the operator. If Operator A were to subcontract to an operator in District B, as would be permitted under this change in legislation, then Operator B could give the job only to a driver who is also licensed in District B with a vehicle licensed in District B, so the chain of accountability remains. I want to make that clear because it seems there has been incredible confusion.
Baroness Howarth of Breckland
Can I just ask the Minister an honest question of clarification? In this age of technology, why can the person who has called the taxi not be told—because that is all that is being asked—that there is a different company coming and make the choice at that point that that is what they want to happen?
Baroness Kramer
Let me move on to exactly that issue because it refers to the first part of Amendment 4. We looked at this very seriously because consent is attractive. First, we looked at the existing situation. As I said, subcontracting across districts in London has been going on for a decade. We have never heard—and we genuinely asked around as much as we could—of anyone complaining that a car came to get them which was not from the firm that they called. You call the Yellow cab company in your area, and a cab from Sun arrives to pick you up. We have never found any complaints that people were not asked for their consent before that happened. So the question arises: is there a problem? Again, within individual districts, subcontracting has been permitted for as long as anyone can remember. We have not had any complaints and cannot find anybody saying “I wasn’t asked before the subcontracting happened within this licensing district”.
Then we looked at the practical application. The big companies—my noble friend Lord Deben underscored this—could probably handle it quite easily. For people who go to a website or an app to book a cab, some additional lines somewhere in the terms and conditions would probably cover the consent issue—not that I have ever met anyone who has ever read the terms and conditions. The burden will fall on small companies which rely on the telephone. When we first started to look at this, I was quite hopeful that a casual question such as, “Do you mind if we need to bring in a cab from another area?”, would do, but in this day and age, to be legally secure, in effect the operator would have to read out something very like those six or seven lines you would find in the terms and conditions. I suggest that would drive everybody batty. Small companies do not have legal staff on hand and creating that and having to say that routinely every time would be an imposition, particularly when we can identify no problem.
We want to make sure that small companies have flexibility. This brings me to the second reason why we have adopted these clauses because it is particularly important. It is that these are changing times. Small players will be able to create collaborations with other companies in another district to be sure that they will have a larger pool of companies. Their reputation is on the line and the original operator is always on the line for the booking. Having that greater reach of cars gives them the ability to compete against the big boys who, I suspect, would like to see many of them out of business. I am grateful to my noble friend Lord Ridley for enumerating the many other business benefits—not running empty cars et cetera. It is particularly important for small players to have that flexibility, and it is another rationale for bringing this forward ahead of the Law Commission.
I have covered some of the reasons why we are concerned about the consent language. It appears attractive on the surface, but when we looked at it, it was becoming an impossible burden, particularly on small players. The enforcement clause raised more questions. First, it is only with regard to a vehicle. We currently have that chain of accountability—operator, licensed vehicle licence, driver licence—within the same enforcement authority, which is important. This clause deals only with the vehicle licence. It also fails to recognise the reality on the ground—I am sorry; I have forgotten which noble Lord made this point. Local authorities can delegate enforcement powers on this issue to other local authorities. With increased subcontracting, which will primarily be across the borders of neighbouring districts, we would not be at all surprised if various local authorities decide to collaborate or to delegate enforcement powers. That has some economies for them and will streamline enforcement.
At the moment, cars constantly cross district lines. It is quite possible that the car you get into is taking you shopping in another licensing district or to see Aunt Sally in another licensing district, so local authorities are very used to having to deal with the fact that cars are coming from other licensing districts and to communicating with the licensing district for enforcement purposes. Therefore they have experience in this area and deal with it on a regular basis. I therefore suggest that we do not have a particular problem here, and that what has been presented is a rather clear and narrow power that, frankly, would not contribute very much to effective enforcement.
Baroness Thornton
The noble Baroness keeps saying that there is no problem here. Why then, for example, do the student unions all say that their agreements with local taxi companies will be undermined and that they have problems? Those campus universities have huge problems with taxi companies going from one district to another and with the accountability of those companies. The noble Baroness knows that, because she will have received the same information that I did from Warwick, Coventry and Huddersfield.
Baroness Kramer
I point out to the noble Baroness that she is describing a situation that exists today. I cannot answer to the individual situations, but it may well be that with a subcontracting arrangement in place it would be possible to have more secure arrangements for these various universities, which presently go to operators that cannot do the subcontracting that I have just described. However, there are many misconceptions about the relatively small changes that we are making and the benefits that they offer.
Baroness Thornton
These student unions are concerned about the safety of their students—that is their issue. The noble Baroness is dismissing those concerns and the safety issues that noble Lords have been asking her about. She needs to address the issues around safety here.
Baroness Kramer
I absolutely accept that safety has to be the primary issue. I make the argument that you could see these measures as only enhancing safety by making licensed vehicles or drivers more available to a wider range of people, through subcontracting from one operator to another. This system was adopted in London because it added to the safety of the travelling public. We have not allowed the rest of the country to have that benefit, and it is time we did. Having read much of the material that has come to me, I agree that there are many misconceptions around the clauses we have brought forward. However, it is important for us to look at the reality and make sure that we make these relatively small changes. Eventually there will be a major piece of primary legislation, so it is important that we do not pursue the amendments that the noble Baroness has brought forward and that we understand the benefits that will come from the clauses that have been proposed to provide for subcontracting across districts in the private hire industry.
Lord Harris of Haringey
Before the noble Baroness sits down, can she just explain to the House clearly why the Government are pressing forward with these changes rather than waiting for the report from the Law Commission? If her argument is that that will be long delayed, can she tell us for how long it will be delayed?
Baroness Kramer
I thought that I had explained that, but I will repeat it very quickly. Obviously, we are working on our response to the Law Commission. I have listened to this House today, and this will be a complex piece of legislation in the very much changing world of private hire and taxis, so it seems wrong to deny the public the benefits of simple changes that could be passed now. As I say, they both enhance safety and give flexibility and opportunity, particularly to the small players, who must live day to day. I see no reason not to take advantage of that possibility.
Lord Harris of Haringey
So the Government have the Law Commission’s report at this stage?
Baroness Kramer
I am sorry, but I feel as if I am constantly bobbing up and down. Yes—we are preparing our response to the Law Commission.
Baroness Thornton
I thank noble Lords for this debate and for all their contributions. I agree with the noble Lord, Lord Deben, that technology has moved on—he is absolutely correct. However, the principle of safeguarding people is one that you would want to operate whatever the technology or lack of technology that is being used to order your taxi, whether you do that online or not. I thank the noble Baroness, Lady Howarth, for her contributions.
I need to be quite clear with the Minister that I have not said that we are opposed to flexibility. The Minister keeps putting this sally up, that we are opposed to the availability of more taxis. That is not the case; I have now said it twice on the record. In these amendments, we seek to ensure that people have a choice. The Minister dismisses the idea of consent in a very cavalier fashion; she says, in effect, “Consent is attractive, but we have looked at it and it is too complicated, so we are not going to go down that road”. Well, frankly, I do not think that is good enough. It is very important that people give consent as to whose cab they get into and when.
The Minister is right that local taxi companies will combine and provide a better service, and we want them to do so, but we need to ensure that it is done with the safeguarding of the travelling public in mind. That is what these very small and very modest amendments seek to do. I say to the noble Viscount, Lord Ridley, that we are not seeking to oppose these clauses. In fact, we are silent about Clause 10. We are seeking to make modest amendments to Clause 11 that address the issues of customer choice and the travelling public’s safety.
The Minister said that there were a lot of misconceptions out there. Well, frankly, if people are worried and have misconceptions, it is the Government’s job to put those to rest, and the Government have failed to do that. They have failed to make the student unions believe that their students will be safe with this legislation and failed to convince the Suzy Lamplugh Trust that this deregulation will make women safer. At the moment, the only things before the House are my amendments, which seek to do those things. I wish to test the opinion of the House.
Baroness Hayter of Kentish Town (Lab)
My Lords, the Government’s new partial authorisation for insolvency practitioners would split the existing regulation of this quite tiny profession—some 1,350 who take appointments, according to the noble and learned Lord the Minister—into three. There would be company-only and individual-only insolvency practitioners, and some of course doing both. On the basis of no evidence, the Government have decided to dilute this very small but specialist profession. Amendment 6 would preclude the development of corporate-only licences.
The Government admitted to the insolvency practitioners’ professional body, R3, that Clause 17 was not being introduced to “fix a problem”. Indeed, the Government cited no evidence of undercapacity in the market, nor of complaints about the current system. Virtually all the insolvency practitioners consulted, and their major representatives, said that the proposal was a bad idea. The ICAEW’s consultation evidenced no support for the partial qualification. Indeed, the only body cited as being in support, the IPA, found that 61% of its respondents were against—they did not think that the proposals were a good idea.
According to the Government, it was only some of the IPA’s non-practitioner members who were in favour. More than that, having finally seen the IPA’s survey last week, I discovered that its questionnaire did not distinguish between individual insolvency-only licences, which we support, and corporate-only licences, about which we have grave reservations. So the IPA has no idea whether any of its respondents support the idea of practitioners undertaking corporate insolvencies without also being qualified in individual insolvency. Furthermore, despite finding that a majority of its respondents did not think it was a good idea, the IPA dismissed these views as being those only “of current licence holders”. Surely those are exactly the people who know what they are talking about.
Without Amendment 6, Clause 17 would allow insolvency practitioners to undertake corporate bankruptcies, which almost always also affect the financial status of individuals, with no qualification as to the latter’s needs. Indeed, insolvency practitioners often do not know at the outset of a case, particularly with micro-businesses, whether they are dealing with a corporate or personal insolvency—or, indeed, with both, given the involvement of personal guarantees and the nature of creditors.
It is strange that this Deregulation Bill will create three types of licence—rather than the current one—with new exams, oversight and monitoring. The assertion has been made, but with no evidence, that it will attract new entrants; the assertion has been made by the Government that IP fees will be reduced, without any evidence; and the assertion has been made that training costs will be reduced. Again, no evidence was supplied. This whole shake-up is on the basis, by the Government’s own estimates, that there will be only about 100 partial licences.
Furthermore, it is likely to be the large insolvency firms that train corporate-only practitioners at the expense of smaller insolvency firms, of which two-thirds do both corporate and personal insolvencies. More than 80% of smaller firms do not believe that they would get much benefit from lower training costs. Indeed, 90% said that they would not train a partial licence holder. Smaller firms are least likely to specialise and are therefore least likely to benefit from the change. So there is no help to smaller firms—just when the Small Business, Enterprise and Employment Bill is aimed at trying to help small firms.
Why have the Government dreamt up this clause? There is no evidence of a waiting group of would-be IPs dying to enter the market if only they could train simply in corporate insolvencies. Indeed, a number of firms have been reducing their workforce. The Insolvency Lawyers’ Association questioned the logistics of operating a two-tier mixed system, while R3 has serious concerns about the change. It considers that partial licences will have a negative impact on businesses and individuals seeking financial advice, and on the quality and competitiveness of the UK’s insolvency regime, which is currently rated one of the world’s best by the World Bank. Meanwhile the Institute of Chartered Accountants of England and Wales, the largest authorised body regulating insolvency practitioners—regulating, I think, about half the profession—opposes this partial insolvency licence system. It set out its reasoning to the Government a year ago. The Government, however, ignored that, despite the reputation and expertise of the ICAEW. The institute sees no need for partial licensing; it is unaware of any demand for it; and it does not consider that regulatory costs would be lower.
The ICAEW is also concerned that an insolvency practitioner with partial authorisation would not acquire the broad range of knowledge and expertise necessary to provide appropriate advice in a corporate insolvency. We also fear that the proposal would lower standards, given that Jenny Willott MP, the Minister in the Commons, said that the partial licence would,
“reduce a little the high bar on entry to the profession”.
As the ICAEW retorted:
“Reducing the breadth of knowledge required of IPs could be regarded as a lowering of standards”.
We are talking about people’s futures: whether jobs are to be saved or a company liquidated; whether individuals will be made bankrupt; whether creditors will get their money back; whether a company will be sold to someone who can retain at least some of the business.
The Institute of Chartered Accountants of England and Wales, which operates under a royal charter, works in the public interest. Given the potential impact on standards of practice that partial authorisation might have, it does not believe that the proposed reform would be beneficial to the public. The proposal to allow corporate bankruptcies to be handled by people who are unqualified in personal insolvency is misguided, unnecessary, criticised by the profession and other stakeholders and based on unsubstantiated claims. Apart from that, it seems a very good idea.
I urge the Government—even at this late stage—to think again, to listen to R3, the ICAEW and other specialists, and to accept Amendment 6. I beg to move.
The Advocate-General for Scotland (Lord Wallace of Tankerness) (LD)
My Lords, I am grateful to the noble Baroness for tabling this amendment. We have debated this matter in Committee and I met her and representatives of R3 a few weeks ago to discuss it. The amendment seeks to limit partial authorisation to personal insolvency. This debate allows the Government to set out why we believe that allowing specialised authorisation for insolvency practitioners for both personal and corporate insolvency is the right thing to do.
I recognise that this is a matter of considerable interest to those in the insolvency profession. However, there is a wider impact. The purpose of generally requiring insolvency practitioners to have certain qualifications and experience is that they are given significant powers by statute and it is important that there is confidence that they will use such powers appropriately. It is not to protect insolvency practitioners as a profession as such. It is important, therefore, that the barriers this places on entry—there is quite properly a barrier because of the statutory responsibilities and powers—are no higher than needed for the purpose. I think this was the context in which my right honourable friend Jenny Willott was speaking. The noble Baroness has not provided any evidence whatever that having separate authorisations for personal and corporate insolvency would in any way lower the standards in each of these disciplines.
Most insolvency practitioners are already qualified, usually as accountants, sometimes as lawyers. What we are discussing is what specific training and qualifications they need in order to act as insolvency practitioners. The amendment would allow specialised authorisation in personal insolvency but not corporate, so I will focus on why we believe that it would be helpful to allow specialised authorisation for corporate insolvency.
Opponents have said—as the noble Baroness herself did in moving her amendment—that there is no evidence of the need for change. However, there have been reports on the insolvency profession that have raised concerns about the level of competition in this profession. Two independent reports have noted failings in the current regime that result in fees being higher than they should be. We believe that partial authorisation will increase competition and place downward pressure on fees, which in turn could benefit creditors in the form of higher dividends.
Baroness Hayter of Kentish Town
I thank the noble and learned Lord for that response and for the meeting with representatives of R3. I do not mind the Government not listening to me, but they do not listen to R3, to the Institute of Chartered Accountants in England and Wales, or to all those who are practising in this area. I will say only two things.
The first is a point on fees and the idea that this is simply a matter of bringing more people in. I hae ma doots about that; it is about the big ones charging high fees. Indeed, in the Small Business, Enterprise and Employment Bill, the Government are going to abolish creditors’ meetings, which is the one point at which creditors can negotiate over those. Perhaps that might have been a better way of helping creditors achieve a better fee rate.
The only other point to make is this. I refer to the noble and learned Lord’s own profession of the law. As with doctors and accountants, everyone does general training before moving on to specialise. This is an important and fundamental way of understanding the environment, and it is strange to separate one profession away from it. I do not think that the barrier to entry should be lowered, which is what I fear this will be. As I say, the Government have failed to listen to those who know this industry, and they are clearly not going to change their mind tonight. On that basis, I beg leave to withdraw the amendment.
Baroness Byford
“Applications for public path extinguishment of diversion orders: review
(1) Within two years of the coming into force of the rights of way provisions in this Act, the Secretary of State shall lay before both Houses of Parliament a report containing an assessment by Natural England’s Stakeholder Working Group on Unrecorded Rights of Way of how effective the right to apply provisions and the accompanying guidance have proved in getting local authorities to respond positively to applications for public path extinguishment or diversion orders.
(2) As well as looking at the overall effectiveness of the legislation and the accompanying guidance, the report shall include an assessment of any notable disparities between the various local authorities.”
Baroness Byford (Con)
My Lords, I should remind noble Lords of my farming interests, that I am a member of the CLA, and of the other interests that are set out in the register. Clauses 20 to 27 cover the “Use of land” where, thanks to the excellent work of the stakeholder working group on unrecorded rights of way established by Natural England, improvements have been made to the legislation before us. However, there are still some outstanding areas of concern. Amendment 7, which is supported by my noble friend Lord Skelmersdale, proposes that there should be a review within two years of:
“Applications for public path extinguishment of diversion orders”.
I moved an amendment in Committee that such a review should be carried out within one year, but on reflection I do not believe that that would have allowed adequate time to assess whether the proposed changes in the Bill had been successful or not. In Committee I was very grateful for the contributions made from around the Chamber by the noble Lords, Lord Rooker and Lord Cameron of Dillington, and the noble Earl, Lord Lytton, and by my noble friends Lord Cathcart and Lord Plumb, to name just a few. We debated the whole question of wider access for the public to farmland and, in some cases, through people’s gardens and close to their houses. I accept that philosophical differences were reflected in those contributions, but I have to tell noble Lords that for those families who are affected by such intrusions, this has proved to be distressing, to say the least.
I am grateful to the Minister, my noble friend Lord De Mauley, for arranging a meeting at Defra for myself and my noble friend Lord Skelmersdale at which we were able to debate this issue further. However, I understand that following a recent meeting of the stakeholder working group, the CLA has raised three further issues with the Minister to which it has not received a response. Is he in a position to clarify these matters as they reinforce my belief that an earlier review is needed? Perhaps I may quote the association:
“CLA remain concerned that the ‘right to apply’ does not provide a presumption that paths will be diverted away from gardens, houses and business, nor does the right to apply ensure a different outcome for the landowner.
“The legislation does not provide a means by which a farmer, for example, who wishes to put a gate on his drive to make his farm less susceptible to theft, or wants to put bollards to prevent illegal vehicles, can do this. He cannot apply to the authority for such a structure, and the authority, even if it is sympathetic would have to be extremely creative with current legislation, to satisfy such a request. Structures can only be requested if required for the control of livestock. The SWG recommendation that a clause be inserted allowing authorities to consider structures in a wide variety of circumstances was a pragmatic, deregulatory solution to a currently very regulated and constricted practice.
“There is also the issue of right to access in extremely intrusive areas such as through private gardens and yards based on memory of a path rather than hard evidence. It can only be right that any access or right of way should have to be based upon objective evidence rather than subjective opinion and memory. This is especially important given that there is no time limit within which claims can be made—thus claims can be made about very detailed routes which people claim to have walked 30, 40, 50 years ago.
“The Deregulation Bill presents an opportunity to ensure clear guidance for users, landowners and local authorities in what can be the very emotive issue of rights of way”.
In Committee, my noble friend Lord De Mauley quoted figures from research undertaken by the Ramblers which recorded that of the 1,200 diversion orders applied for, some 94% were granted without any objections, which is good. Of the remaining 6%, only 1% were not confirmed by the Secretary of State. But some of those were affected, and I have received evidence citing many examples from different counties around the country where great distress has resulted. In one case, an owner was subjected to an onslaught by the council, and it was feared that all that worry was one of the contributing factors to his later suicide. When speaking to his own amendment in Committee, my noble friend Lord Skelmersdale said that:
“The stress and the financial hardship involved in employing specialist lawyers, only to learn that one has virtually no legal rights, have led to illness, mental breakdowns and at least two suicides”.—[Official Report, 28/10/14; col. GC401.]
Noble Lords may be wondering why I am quoting these remarks. It is to reinforce my view that we need to bring the review forward, particularly if we are not going to see further changes to the Bill to address the three outstanding issues. Given that, waiting three years for a review is three years too long, but if the Government did not like my suggestion of one year, I hope that the halfway house of two years might be considered.
This is an important debate and again I thank the Minister for his courtesy in talking about these issues through the amendments we tabled in Committee. I beg to move.
Lord Skelmersdale
My Lords, as my noble friend Lady Byford said, my Amendment 12 has been grouped with her Amendment 7. Not surprisingly, the scene has moved on in the long period since Committee, when there was a surprising amount of support for the series of amendments in my name which had the effect of a presumption in favour of a diversion or stopping up of a footpath that passes through the curtilage of a residential building, including the gardens and driveways of premises. In other words, those amendments were somewhat more restrictive than that in the name of my noble friend, which I supported at the time and, as noble Lords can see from the Marshalled List, still do.
Since then, strange things have happened and I have had reports of odd decisions made by footpath officers in local authorities, the worst of which was the refusal to annul a recent order dedicating a footpath through someone’s dining room. The council in question refused point blank to change its decision. It may be—I am sure my noble friend could tell me—that the officers are not allowed to do this under current legislation but they most certainly are under this Bill. That is one good reason for the Bill. Another local authority insisted that footpaths going through a farmyard barn, which has been in existence since well before footpaths were regulated, should be shown on the definitive map. It is not unlikely, in the modern age, for barns to be converted into housing, with the full agreement of the local planning inspector. Nobody seems to check whether a footpath goes through the old farmyard and thus becomes, potentially, a major inconvenience to the owner of the barn conversion. There is something wrong, somewhere.
It was for these reasons that I moved my amendments in Committee. Because it was a Grand Committee I could not press them, although at the time I was sure I would have been justified in doing so, such was the support from all around the Committee. My noble friend Lord De Mauley was far from keen on my approach and wished to stick to the formula in the Bill—namely, the right for the householder to apply to the local authority and, if necessary, appeal to the Secretary of State. This was backed up by a meeting which he kindly hosted shortly after Christmas, to which my noble friend Lady Byford has already referred. At that meeting, it was explained that the scheme in the Bill would take time to bed down among local authorities and the rank and file green lobby. The department wanted time for this to happen, for the curious reason that the consultation on the agreement of the footpaths working group had not gone wide enough. One rather wonders why the working group existed in the first place, but it did and it agreed changes to the Bill which the Government have been so reluctant to approve that they just have not done it.
I hope that I am not taking my noble friend Lady Byford’s name in vain when I say that both she and I are suspicious as to whether the scheme in the Bill, backed up by guidance to local authorities, simply will not work, however thorough the consultation is. Amendment 7, to which I have put my name, asks, as my noble friend said, for the department to produce a report on whether the scheme has actually worked or not after two years. I have to say that I consider the amendment to be very mild, even though it presumes that legislation will follow if the report is negative, although it does not say so. That, of course, means primary legislation, and it will be some time before that becomes law, even if it gets approval from the business managers.
Amendment 12 allows the Secretary of State a fall-back position, whereby, if the proposals in the Bill are not followed by local authorities, the Secretary of State can lay regulations to make rules according to which a local authority shall make decisions regarding the scheme. This will have two distinct advantages. First, it will reduce the number of appeals, which are likely to be much higher than the department currently envisages, because I suspect that most aggrieved applicants will appeal against the local authority decision on the basis that the latter has not followed the guidance. At the same time, it will cut out vexatious appeals because everyone will know what the rules are. In the event that this amendment finds favour with your Lordships, it would be necessary to have a further one at Third Reading specifying that the regulations will be by affirmative instrument.
Returning to my basic point, it is quite wrong for footpaths to oppress home owners by taking away the enjoyment of their close property and, to that extent, the Bill, imperfect as it is, may help.
Earl Cathcart (Con)
My Lords, I spoke in Committee in support of the amendments in the name of my noble friend and I will do so again today.
I have three points. First, if you have a public right of way through your garden, you have lost your security, safety and privacy. Anyone can walk through your garden at any time of day or night. Their dogs may run loose, frightening your children, fouling your garden, chasing your pets and even killing your chickens or cats, but there is little or nothing you can do about it. You may be subject to theft or vandalism. Secondly, it costs several thousand pounds to divert a path, but it costs absolutely nothing to object to it. This increases the cost to the applicant dramatically, often beyond their reach. We should be trying to make it easier for the applicant. Thirdly, as my noble friend Lady Byford mentioned, the law as it currently stands does not allow home owners to apply for permission for gates or stiles. Without these, you cannot allow your pets to be left, or allow your children to play, unattended in your garden. This needs changing.
My honourable friend Tom Brake, speaking for the Government at Third Reading of this Bill, said:
“The Government acknowledge that for householders, farmers and others, an intrusive footpath can have a substantial impact on their quality of life or on their ability to run a business. We understand that while this is not a widespread problem, where it occurs it can cause severe difficulties, and in a significant number of cases people have been put through years of considerable inconvenience and stress”.—[Official Report, Commons, 23/6/14; col. 77.]
I could not agree more. I understand that, when the Bill was going through the other place, the Government were going to propose an amendment to rectify this but for some reason they did not. This House has a perfect opportunity to put that right.
My noble friend Lady Byford has also mentioned the concern that there is no presumption that the paths will be diverted away from gardens, houses and businesses. There should be. The Government say that there is guidance on this, but it is only guidance. Some councils comply with it, but too many do not. The answer is for the Government to put something in the Bill, and I hope that my noble friend will.
Lord Grantchester (Lab)
My Lords, legislation on public rights of way is complex, often archaic and certainly plentiful. I declare an interest as an owner of farmland in Cheshire over which there are a number of uncontentious footpaths.
In Committee, many of the issues behind the proposals in the Bill were examined. One of these was the question of procedures and costs involved in addressing the complexities highlighted by footpaths going through gardens and farmyards and alongside private homes, with the consequential privacy and safety concerns. I agree with the noble Lords that this is an important issue and the stakeholder group did address it. However, the measures in the relevant passage of the Bill should alleviate most of the problems. This is not to deny that there may be the further concerns to which the noble Baroness, Lady Byford, has drawn our attention.
In Committee, we were concerned that these measures and others should be subject to follow-up through a report to Parliament. They are, as I have said, very important measures and progress must be made. From the debate in Committee, it is clear that there are several channels of communication through which progress can be monitored and outcomes highlighted, and I am not sure whether there is a need for this proposed new clause to be in the Bill. The Minister at the time may find that a Written Statement would be entirely sufficient and satisfactory as a method of addressing this, but there may be others. The stakeholder working group can issue reports for deliberation. However, if progress is not forthcoming, then we shall certainly return to the issue.
The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord De Mauley) (Con)
My Lords, like my noble friend Lady Byford and the noble Lord, Lord Grantchester, I declare an interest as the owner of a farm across which there are public rights of way and, indeed, as a user of public rights of way myself.
We have considerable sympathy for those people, mentioned by my noble friend Lady Byford, who face problems with a public right of way that passes through their farm or garden and who feel that the system has let them down or conspired against them. Where these cases occur, people may indeed experience acute problems, but they are comparatively few and we should ensure that any changes we make to legislation are proportionate to the extent of the problem.
Rather unconventionally, I will go in reverse order, and turn first to Amendment 12, in the name of my noble friend Lord Skelmersdale. I understand that the intention behind the regulation it proposes is to enable the creation of rules prescribing how local authorities must make decisions on applications to divert or extinguish rights of way. We believe that the combined effect of our existing measures, which have cross-party support in both Houses, will make a significant difference and that we should not legislate further before seeing how these measures work out in practice. I will explain why that is.
There is clear agreement among stakeholders on the working group that the major difficulty for landowners is in getting local authorities to make a diversion or extinguishment order in the first place. Our plans to implement the right to apply for such orders are designed to overcome this. The right to apply will enable a landowner to make a formal application for the diversion or extinguishment of a public right of way. With that will come the right to appeal to the Secretary of State if the authority rejects the application or fails to act on it. Therefore, local authorities will no longer be able to ignore requests or dismiss them out of hand; they will be obliged either to make an order or to be prepared to justify their reasons for not doing so on appeal to the Secretary of State.
The right to apply will be extended to land-use types other than those for agriculture, forestry and the keeping of horses—for example, to private residential gardens. The right to apply will be supplemented by guidance that will effectively act as a presumption to divert or extinguish public rights of way that pass through the gardens of family homes, working farmyards or commercial premises where privacy, safety or security are a problem. I suggest that guidance such as this, which has been introduced though agreement among stakeholders, is far more likely to prove successful in practice, regardless of whether it has statutory backing.
I realise that there is the further hurdle of getting an order confirmed. However, my noble friend Lady Byford quoted my words in Committee to the effect that, according to Ramblers, which keeps accurate records of these matters, of the 1,257 diversion orders which have reached a conclusion in the last three years, 94% did not attract any objections. Of the 6% that did, less than 1% were not confirmed following submission to the Secretary of State.
In addition, the guidance will give authorities more scope to confirm orders made in the interests of the landowner in circumstances where a right of way may cause hardship because it goes through the garden of a family home, a working farmyard or other commercial premises where privacy, safety and security are a problem. In light of the guidance, authorities would have to put forward compelling reasons for not confirming an order in such circumstances.
We appreciate, and my noble friend will be the first to point out, that the numbers of orders confirmed without objections may fall under the right to apply. Each case will depend on the merits of the proposal. However, given the statistics I have outlined, we believe that the combination of the right to apply and the guidance will have the desired effect and that we should not rush to legislate before giving these measures a chance to work in practice.
Lord Spicer (Con)
I thank the Minister for giving way. The problem with this is that we have been hearing it for 40 years. I was chairman of something called the Spicer committee 40 years ago, which comprised the National Farmers’ Union, the Government and a whole lot of other bodies. We came up then with what we thought were solutions to try to make it easier for the applicant. Forty years later, we are still in the same position and still being told roughly the same stuff by the Government. This is why it is so difficult to believe what is coming out now.
Lord De Mauley
I understand my noble friend’s point, but I hope he would be prepared to give the provisions in the Bill a chance. They are actually quite far reaching. With great respect to my noble friends, who have raised some important points, we are talking here about points which, in their eyes, would make yet further improvements. I think my noble friends acknowledged in their speeches today that there are already some good, positive changes in this Bill. I hope my noble friend would accept that.
Moreover, under the right to apply provisions, the Secretary of State will be the confirming authority for all disputed orders. The Government will therefore be in a prime position to promote implementation of the revised policy set out in the guidance by setting a clear precedent with any cases that come before the Secretary of State. In addition, the Government will work with rights of way officers, through their professional organisations, actively to promote to local authorities the existing guidance on diversion or extinguishment of rights of way which pass through gardens, farmyards or commercial premises.
To return to the amendment, the existing legislation on extinguishments and diversions, in Sections 118 and 119 of the Highways Act 1980, already sets out rules, which Parliament has debated and agreed, under which local authorities make decisions on applications to divert or extinguish rights of way. My noble friend’s proposed regulation-making power would, in effect, be a power to make new rules by delegated legislation and therefore without full parliamentary scrutiny. I suggest that it is highly unlikely that we would get stakeholder agreement to such a measure, knowing that this was the purpose behind the amendment.
Lord Skelmersdale
Will my noble friend give way? I thought, or at least I hoped, that I had made it quite clear that, if my noble friend accepted my amendment—which, clearly, he is not going to—it would be necessary to have a Third Reading amendment to make these regulations by affirmative order. In that case, of course, they would have parliamentary scrutiny.
Lord De Mauley
My noble friend makes a fair point.
It has been clear throughout the Bill’s passage that Parliament agrees with our view that that the consensus should be supported by keeping the rights of way package as it stands. I spoke to the stakeholder working group at its latest meeting and learnt at first hand that its overriding aim is to get the package implemented intact. We are determined that the consensus should not be put at risk by adding measures that have not been discussed with stakeholders and, of course, not consulted on.
Amendment 7, tabled by my noble friend Lady Byford, is intended to ensure that the Government review the success or otherwise of these measures after their implementation. That is an absolutely laudable aim and one that, in any event, would be a matter of good practice. However, although we agree with the aim of evaluating the effectiveness of the right to apply and associated guidance, I hope that my noble friend will agree that it would not be appropriate to use a deregulatory Bill to impose on the Government the statutory burden of making a formal report. That would run contrary to the aims of the Bill.
In the other place, the Government have already put on record that the stakeholder working group’s advice will be sought on the constitution of a review panel to advise on how well the reforms are working and whether any further measures need to be taken before the cut-off date. I am happy to put on record now that we will ensure that any arrangements to review the rights of way reforms will include an assessment, within two years of implementation of the reforms package, of how effective the right to apply provisions and the accompanying guidance have proved in getting local authorities to respond positively to applications for public path extinguishment or diversion orders.
The proposed assessment will include an opportunity for people to provide evidence to the stakeholder working group either through wider consultation outside the group or a call for evidence. The assessment will send a message to authorities that the Government are determined that the new policy should work and that if guidance does not bring about sufficient change, we will consider introducing further measures.
My noble friend Lady Byford returned to the issue that we discussed in Committee about the authorisation of gates. We recognise that an amendment to extend the powers to authorise gates and similar structures could be helpful to people with a right of way going through their premises or garden. The stakeholder working group discussed this at some length. While there was agreement about the proposal in principle, the group has not yet arrived at a formulation on which it could agree. Those measures have not, unlike the rest of the package, been widely consulted on and are therefore not necessarily agreed by wider stakeholders, whose views we also have to consider.
Concerns have been expressed by users of rights of way about the possible proliferation of gates and other structures across rights of way. Particular concern has been raised with me by equestrian groups in the stakeholder working group that I attended. They are worried about riders with disabilities who may not be able to dismount or who have difficulties in opening and closing gates without risk of injury to themselves or their horse. Since the House of Lords Committee stage of the Bill I have received correspondence expressing concern about the suggestion that the powers of local authorities to authorise gates should be further extended beyond those changes already being introduced by Clause 24.
My noble friend also raised the point about the right to apply not providing a presumption that paths will be diverted away from gardens, houses and businesses. We have covered that quite extensively. The guidance agreed by the stakeholder working group introduces a presumption that paths will be diverted away from houses and businesses. We believe that the guidance, combined with the right to apply, will have the desired effect. My noble friend also asked whether there should not be a time limit on making claims based on long use. The stakeholder working group has not been able to reach an agreement on that, but it will continue to keep it under review.
On that basis, I hope that my noble friend will withdraw her amendment.
Baroness Byford
My Lords, although I am grateful to my noble friend for his full response to my Amendment 7 and for his acceptance that the review should take place two years after the Bill becomes enacted rather than after three years, as was originally proposed, I will read Hansard carefully—but this is indeed welcome.
I still have some concerns about the important ongoing work by the stakeholder working group. We get such few opportunities of such legislation coming before us in Parliament, when we have a chance to try to make sure that practicalities are overcome if they possibly can be—although that is not always possible. I hope that the stakeholder working group will continue to work closely together to try to resolve some of these issues. They are not impossible to resolve. My noble friend Lord Cathcart said that it is costly to apply for diversions. I gather that unopposed diversions cost about £2,000, but those that are opposed cost more than £8,000 and can be dearer. We need to keep that in the back of our minds when we are talking in fairly general terms about something that was a problem 40 years ago, to which my noble friend Lord Spicer referred.
Although there are improvements in this Bill, which I have publicly acknowledged, there are still things that need addressing. If that cannot be done within the Bill, I hope that the words that my noble friend the Minister has given me today will fill me with confidence rather than suggesting that he thinks that I have got it wrong.
We have another stage. Other Peers have taken part in this short debate: my noble friends Lord Skelmersdale, Lord Cathcart and Lord Spicer, as well as the noble Lord, Lord Grantchester. The noble Lord has, as I do, footpaths across his land and we are happy to have them. Ours are not contentious, but there are people—and 1% is 1% too many—who are having a rough time, because the various interested bodies cannot get together to try to reach a proper outcome to something that I hope is not an insurmountable problem. It may seem a huge problem to those who want the right of way; and those who say that if they were to divert it, that would be of benefit to everybody. Perhaps the working group could attach a little more vigour to some of the outstanding issues.
I thank my noble friend and other noble Lords who have taken part in this debate, and, with my noble friend’s words saying that within two years there will be a review panel rather than a report, I beg leave to withdraw the amendment.
Lord De Mauley
Lord De Mauley
My Lords, government Amendments 8, 9, 10, 11, 13, 14 and 15 in this group are minor and technical in nature and do not make any substantive change to the policy of Clause 25 or Schedule 7. They make in fact the following changes.
One is a correction to new Section 54C(3) of the Wildlife and Countryside Act 1981, which is concerned with modification consent orders, to make any path or way resulting from such an order “maintainable at public expense” instead of making the surveying authority responsible for its maintenance. This small change in terminology makes the provision consistent with existing rights of way provisions and avoids creating any uncertainty among practitioners. There are extant provisions that enable diversion and extinguishment orders to be severed, where only part of an order is subject to a valid objection. Another change in terminology substitutes “parts” for “modifications” in these provisions. That is because “modifications” has a very particular meaning in relation to definitive map modification orders and is best confined to that context.
The final change is to enable the Secretary of State to decide which procedure to use in deciding appeals and objections on rights of way diversion and extinguishment orders. This will make the procedure consistent with that for recording rights of way. It will enable the Secretary of State to opt for the exchange of written representations rather than a hearing or public inquiry and avoid unnecessary and costly public inquiries where there is no justification for them.
My noble friends Lord Greaves and Lord Bradshaw have amendments in this group, but it is appropriate that they introduce them before I respond. I beg to move.
Lord Bradshaw (LD)
My Lords, the problem we are trying to deal with is the unauthorised use of green lanes by 4x4 vehicles and trail motorbikes. This problem is getting worse, making many rights of way impassable and creating an intrusive noise nuisance. Present legislation is entirely inadequate for dealing with this problem. Local authorities which are short of resources are unable or unwilling to commit to dealing with an outdated and burdensome situation.
When the Peak District National Park and other national parks were formed, the use of rights of way by 4x4 vehicles and trail motorbikes for recreational purposes was not foreseen. At present there is no simple way of dealing with this obstructive and noisy nuisance and some fresh way must be found to deal with a problem that prevents walkers and riders enjoying the countryside. The purpose of any new legislation would be to create a right of appeal where a highway authority fails to make a traffic regulation order that excludes motor vehicles from a byway open to all traffic, and other green lanes, where there is evidence that such an action is necessary. At present, local communities have no redress if their highway authority refuses to act.
Lord Cameron of Dillington (CB)
My Lords, I have added my name to Amendment 17. I declare an interest as a farmer in Somerset with rights of way on my land. Like the Minister, I am a great enjoyer of our rights of way across the country.
I will not repeat all I said in Committee about this being a deregulatory amendment, but it does have the potential dramatically to reduce the administrative work of the local highway authority while greatly simplifying the law and the lives of others. It also has the potential to reduce the onerous duty to repair the surfaces of all highways on the part of local highways authorities, which we know are extremely strapped for cash at the moment. The fact that most local highway authorities pay virtually no attention at all to their duty of repair on anything less than an adopted highway is no excuse for us not to try to minimise their responsibilities.
Anyone who has seen pictures of green lanes from all around the country, particularly the pictures of green lanes in the Lake District National Park that have been circulated recently, will be in no doubt that regular motorised traffic on those green lanes is not compatible with fair enjoyment of the countryside by walkers, bicyclists and riders. Something has to be done and the wrongful assumption that motorised vehicles automatically have rights on all those green lanes needs to be rejected. If they have rights, I and others believe that it is their responsibility to prove them.
I recognise that the Minister proposes the setting up of a motor vehicle working group in response to the amendment. I am sure that is not a way of pushing the whole issue into the long grass. I have every expectation that he will respond favourably to the amendment or at least its intent. I also realise that we have to tread softly, softly on this matter. All I would say is that this long-lasting sore on the face of responsible access to the countryside has to be firmly gripped, and soon; or, as the noble Lord, Lord Bradshaw, said, come 2026, which is just 11 years away, we will still find ourselves floundering around in the mud, both literally and metaphorically—literally on the ground and metaphorically, administratively in county halls—with no greater clarity than today. Defra has already acknowledged that the 2026 cut-off date cannot be met under the current circumstances—it is 11 years off and it cannot be met—due to the number of green lanes and the lengthy processes involved. We have to find a better way forward and this amendment, or something like it, is a very reasonable way of achieving that.
Lord Skelmersdale
My Lords, I understand the rationale behind what the two noble Lords have said on the amendment but I would add a slightly cautionary note. Although we all enjoy walking on footpaths and we get irritated by bicycles, quad bikes, Land Rovers, et cetera, on paths that are not BOATs, there are those, such as disabled people, who are able to enjoy such footpaths only through the use of some sort of propelled vehicle. Although I readily understand that there is a need for control, I do not believe that it should be absolute and I look forward very much to listening to what my noble friend the Minister has to say on the working group that is proposed.
Lord Judd (Lab)
My Lords, I very strongly support Amendment 17. I thank the noble Lord, Lord Bradshaw, for putting it forward. It is constructive, public-spirited, responsible and sensible—just like the old Bradshaw’s timetables.
There is one caveat I want to make. There is an issue that we all have to face. Those of us who are able to enjoy remote and attractive areas must remember that there are very many people for whom this is not a practical possibility because of their physical condition. We all need to get our minds round the issue of how we can improve access for such people so that they are able to share in something that we all regard as precious. Of course, that has to be done by consultation and, if necessary, appropriate legislation and regulations, but it should be done in a sensible way, with the full co-operation and backing of the authorities that are responsible for a particular piece of land.
Having said that, the noble Lord put it in very moderate language but what he revealed is actually a nightmare. At times it can be described only as vandalism—if it were to happen in an urban area, there would be an outcry—despoiling and ruining decent, attractive countryside and making a hell for some people who are trying to enjoy that countryside in a quiet and peaceful way. In fact it can be quite a frightening experience for those who may be able—I count myself among those now—to just about make those areas, but who may have certain disabilities and so on which make them feel vulnerable. That is not least the case for those with loss of hearing, for whom the sudden noise and disturbance of these vehicles can be an unpleasant experience.
The issue is mainly about what is being done to places of special significance, scenically and in other ways. It is also about this “couldn’t care less” attitude—that it is left to somebody else to deal with and clear up, which is utterly selfish as well as being vandalism. We should all recognise that, and wish godspeed to the noble Lord’s amendment, because it is vital. I should of course declare an interest as patron and former president of Friends of the Lake District, and as vice-president of the Campaign for National Parks, but I assure you that the remarks I have made this evening come from the heart in terms of being a resident of one of the areas that has quite a number of beautiful things that can so easily be ruined and destroyed.
Baroness Byford (Con)
My Lords, I will add a few words on this amendment, because it is at the very heart of enjoyment of the countryside, and the contributions we have heard from around the Chamber tonight rather reflect the challenges that we place on our countryside. From the perspective of disability access, which my noble friend mentioned, it is hugely important that people who are not able to walk freely, or cannot get around in the way they used to be able to, have access to the countryside. But due to the sort of damage to the green lanes that my noble friend Lord Bradshaw was talking about, they would not be able to get through those anyway. In many cases the countryside is being ruined as the green lanes have become bogs, and the people that do it have very little regard for the enjoyment and pleasure of anybody else.
There are also landowners who are quite willing to open up areas of their own land and make it available to those who wish to follow the sport of 4x4s, who get a thrill from that sort of activity where it is well organised. But it is the result of the devastation that is caused to some of our most beautiful areas that we are trying to address within this amendment. I had not looked to speak in this debate, but I am moved to do so because if we are going to have another working group looking at it, there are clear aspects that need to be taken into account. It is not just a question of saying to people who enjoy the sport of 4x4s, “You can’t do it”, but that they can and that there should be areas in which they can do it; nor saying to people who are disabled who need to have motorised access to the countryside, “You can’t get through because we are going to ban everything”. There is a balance to be found in the way that this is looked at.
I do not know what the Minister’s response will be to this amendment, but I hope that he is able to give some words of encouragement to the setting up of the working group and that it specifically looks at separate issues, because it is all too easy to say, “That will cover the whole”, when it clearly will not. I will again listen with interest to what the Minister has to say on this, but I hope we clearly recognise the needs of those who would like to access countryside but cannot, and those who would like to use 4x4s in a particular manner.
One further thing to add to this debate is the whole question of the countryside and of our wildlife. Not too much takes place on that; I suspect that these issues have been driven aside. Another aside to add is that those of us involved in stewardship and single farm payments know very well where we have got the six-metre strips or whatever it might be. One is very careful as to what motorised vehicle goes over that at all because of the damage to the wildlife and its sustainability. I am delighted that this amendment has been raised, and I look with interest to the response we get from the Minister.
Lord Skelmersdale
My Lords, would my noble friend accept another thought? As she said, she is a farmer but not a farmer on—for example—the Quantocks, or Exmoor, or further north in Cumbria like the noble Lord, Lord Judd, although I believe he is not a farmer; none the less he is a resident. They have to get around their land on some sort of vehicle, whether it is a tractor or a quad bike.
Baroness Byford
Indeed. I am so sorry I did not include quad bikes; they are a normal sort of motor vehicle that is essential to farming in many areas. We do not happen to have one on our farm, but we do not have the sort of access being debated this afternoon. My noble friend is quite right to reflect on how important that access is.
Lord Grantchester
My Lords, the stakeholder working group is to be commended on finding and building consensus around the main interested groups to recommend the changes to the Bill as a package, to streamline the process, and to make quicker progress with less contention and confrontation, even though there may appear to be plenty of time until 2026, the cut-off date under the CROW Act 2000. We agree with the measures in the Bill as a balanced approach to speed up the process. We wish to retain the consensus and build on it. I am grateful to the Government for listening to our views and those of many others, reflecting on the proposals and coming forward with these further technical clarifications. We agree that the stakeholder working group must be retained following this excellent report, and its remit extended to experience more contentious, protracted issues. Indeed, in the other place, the Minister agreed to set this up.
The problem raised through Amendment 17 is one that needs addressing, but not in the context of this Bill. This is not to deny that there are issues, costs and damage created by the use of off-road all-terrain vehicles. However, they must be addressed in the context that 62% of byway traffic is due to land management and dwelling access, with the remaining 38% due to recreation. The damage done by this 38% cannot be denied, and the noble Lords, Lord Bradshaw and Lord Cameron, and my noble friend Lord Judd have highlighted this tonight. But 70% of byways are without drainage, and much damage can be done by farm vehicles, water erosion and poor maintenance. The stakeholder working group must be allowed to examine the issue to find solutions first, to be arrived at through dialogue, a process more likely to result in less conflict, more compromise and thus acceptance, reducing the need for enforcement. Ministers could then make better informed decisions. These measures relating to public rights of way will bring benefit to all interests—land owners, local authorities and the public, even with their competing interests.
Lord De Mauley
My Lords, in what is an understandably contentious debate about the recreational use of motor vehicles on unsurfaced routes in the countryside, and particularly inside national parks, we are addressing similar issues to a debate we had in Committee. We sympathise with genuine concerns about the problems that can arise from the recreational use of motor vehicles on unsealed roads, encapsulated in Amendment 17 by my noble friend Lord Bradshaw. I have seen some of the pictures that the noble Lord, Lord Cameron, referred to. We agree that this is an issue which needs to be tackled and some means of resolution found. The Government’s published response to the Joint Committee’s report of pre-legislative scrutiny on the Deregulation Bill said as much, but also recognised that this Bill is not the right mechanism for doing so. The issue of recreational off-road motor vehicle use is an emotive and contentious one, where one person’s pleasurable pastime is anathema to another. The noble Lord, Lord Grantchester, said that by no means all damage to unsealed roads and tracks is by the recreational use of motor vehicles, and I broadly confirm the figures that he mentioned.
We believe that the best way to review policy on the recreational off-road use of motor vehicles is for it to be based on the stakeholder working group model. I am grateful to noble Lords who echoed those sentiments. That approach has proved to be successful, as demonstrated by the stakeholder consensus on the rights of way reforms package, of which the clauses in this Bill form the major part. This has resulted in mutually beneficial solutions being arrived at through dialogue and negotiation.
The Government plan to set up such a motor vehicle working group, with an independent chairman, as soon as possible after the Deregulation Bill has completed its passage. My department will work with Natural England to organise a secretariat, and it will invite stakeholders with the relevant experience and expertise to join the group. We propose to invite interested organisations to put forward their suggestions for suitable members. In response to my noble friend Lord Bradshaw’s specific question, I say that a key principle is that the group should contain a balance of interests across all sectors. We plan to have members who can represent the interests of national parks, areas of outstanding natural beauty, national trails as well as all the different types of users of rights of way.
Within such a group, recognised professionals can explore all the viable possibilities and their likely consequences. Resolutions arrived at in this way, based on agreement and mutual interest, are likely to result in less conflict and reduce the need for enforcement. Solutions will work best if based on compromise, and I have been assured by those representing the anti-vehicle groups that it is not their intention to change the legislation in relation to allowing motor vehicle trials and competitions. I welcome this approach, as I do the points made by my noble friend Lord Skelmersdale and the noble Lord, Lord Judd.
My noble friend Lord Skelmersdale raised a point about access for disabled people to the countryside. This is a complex issue with many different aspects, which is why it needs to be considered carefully by a working group and fully consulted on.
My noble friend Lord Bradshaw asked about timing. I have said that the stakeholder working group will start its work upon completion of the passage of the Bill. We will set a target time for the group to report. The original stakeholder working group took 18 months to report and I believe that a similar timeframe is realistic for this group to work to. I can confirm that a public consultation will follow the report.
While the group needs to have a clear remit, it will be invited to come up with its own terms of reference. I expect that it will look at all the issues in the round and include assessments of any economic and social benefits of the current recreational use of unsealed roads as well as an assessment of the costs and burdens. On that basis, I hope that my noble friend Lord Bradshaw will be prepared not to press his amendment.
Lord Bradshaw
I thank the Minister for what he has said, but what was missing was the question of what happens—
Lord Gardiner of Kimble (Con)
My Lords, it is my noble friend Lord De Mauley’s amendment that leads this group, so I rather think that my noble friend Lord Bradshaw is not in a position to make the speech that he is proposing to make.
Lord De Mauley
“(3) Where a modification consent order takes effect, any path or way, or any part of a path or way, which is shown in a definitive map and statement in consequence of the order or any special order combined with it under section 54B(5) is maintainable at the public expense”
Lord De Mauley
Lord De Mauley
“( ) In that paragraph, after sub-paragraph (4) (as inserted by sub-paragraph (4) of this paragraph) insert—
“(5) In the case of an order relating to England, the Secretary of State may, instead of affording a person an opportunity of being heard as mentioned in sub-paragraph (2)(b), (2A)(b) or (3)(b), afford the person an opportunity of making representations (or further representations) to a person appointed by him for the purpose.“(6) Where the Secretary of State acts under sub-paragraph (5) by affording a person an opportunity of making representations (or further representations) instead of an opportunity of being heard as mentioned in sub-paragraph (2)(b) or (3)(b), the reference in sub-paragraph (2) or (as the case may be) (3)(c) to the report of the person appointed to hear representations or objections is to be read as a reference to the report of the person appointed under sub-paragraph (5).””
Baroness Hanham
Baroness Hanham (Con)
My Lords, I shall speak also to Amendment 19 and in doing so remind the House that I am co-president of London Councils. It is on behalf of London that I shall speak this evening.
Clause 44 changes the penalties on a national basis for waste collection. It amends provisions in the Environmental Protection Act 1990 on waste collection and waste receptacles. It changes the system from one which was subject to a fixed penalty notice regime—that is, a system based on the criminal law—to one based on the civil processes of a penalty charge notice system. This change seems wholly proportionate and sensible, and I have no disagreement with it.
However, to make this a national system, two provisions have had to be put in the legislation to bring London into the whole pot; namely Clause 44(6) and Schedule 12. Both of those have had to be inserted into this part of the legislation to ensure that it is a national scheme. The reason is that London is already running such a scheme, based on the amended Environmental Protection Act and under the London Local Authorities Act 2007.
This system has been running perfectly happily. It is a decriminalised penalty notice system based on the normal penalty notice way of doing things. It has an appeals system. It is managed by a joint committee of London Councils. It has been the forerunner of what the Government are now trying to do. The system is now recognised by everybody who lives in London. I do not know whether people who are not involved in local authorities realise that it is not always easy either to identify somebody who is causing an infringement of the law or to make sure that they cough up when they are charged or recognised as having done so. As the system has been running perfectly successfully, London wants to stay that way.
My first reason for not wanting to see London included in the processes set out in the Bill, therefore, is that its system has been running perfectly well. The second is the bureaucracy that surrounds the Government’s proposals. There are four pages of legislation to tell enforcement officers how to issue a penalty charge notice. This is meant to be a Deregulation Bill, not a “pile it on high” Bill. With a penalty charge notice—as we all know, because we all get them from time—you receive it, you sigh deeply, you think about throwing it in the bin but, largely, you pay it because it tells you that if you pay up in two weeks you can do it more cheaply than if you wait for four weeks. If you feel really brassed off about it, you appeal. The process is neither very long nor very complicated, but there are four pages of legislation to introduce this new national system.
Lord Tope (LD)
My Lords, I support my noble friend Lady Hanham very strongly and very warmly. I have no particular London interest to declare now, other than that as a resident of London for many years. I was until last May, when I took voluntary retirement, a London borough councillor for 40 years and leader of the council for 13 of those years. If I learned anything from that experience, it was not to mess around with the waste collection system unless it really needed it.
The very simple question to the Minister is: why do the Government feel that London’s system—which, as far as I am aware, has worked extremely well for the last six or seven years and meets all the Government’s requirements in this Bill—is so in need of change that it requires what is in effect eight pages of primary legislation, if you include what is in the Bill and in the schedule, to correct it? What is so wrong with it? The current system is decriminalised and has an appeals system. In fact, it is working so well that there has never actually been an appeal on waste, but the system works well because it is the same or a similar system to that used for parking appeals. There have been just a few parking appeals over the years, so we can say that the system works well and would work well should there ever be an appeal within the waste system.
The other purpose may be to bring London into line with the rest of the country. Why is that necessary? As my noble friend said, there are many issues—two of which we will be discussing next week—on which London has different and separate legislation and provisions to those of the rest of the country. This is one that has existed since the 2007 Act. As we have said, it has worked well and I am not aware of any difficulties, although perhaps we might be about to hear them, so why not leave well alone? This is a system that is tried and tested, is working well and is hugely less cumbersome, time consuming and cost consuming than that proposed in the Bill.
If the Minister is not in a position to agree to these amendments tonight, may I echo the request from my noble friend that he at least agree to meet with us, try to understand our concerns and see whether we can, at least, reach a sensible solution that does not bring such lengthy, cumbersome and unnecessary burdens on London, which already has a much better system that is working? This is not deregulation; it is excessive regulation and does not belong in a Deregulation Bill.
Lord Harris of Haringey
My Lords, like the noble Lord, Lord Tope, I do not have any current London government interests to declare, although I was the founding chair of the artist currently known as London Councils, which was then called the Association of London Government, for five years. I was a London borough leader for a number of years and an elected representative in London for 26 years, and for two—or perhaps four—years I was chair of a London organisation called London Waste Action.
I find Clause 44(6) to be quite bizarre, particularly in a Deregulation Bill. What I understand has happened is that the Government looked for a model of deregulating some of the complexities outside London, found that London had a system that worked and decided to replicate something like it for the rest of the country. However, because of some natural desire in the relevant government department to make things more rather than less complex, which this Bill is supposed to stop from happening, they produced a system that is more complicated than the London one. Then, for ease of simplicity and universality—quite against the principles of localism and devolution, which we understood the Government were in favour of—they decided to impose this more complicated system on London, even though London has a system that works perfectly well.
I frankly do not understand the logic of this. The model that exists in London has emerged through a London Local Authorities Bill, which was passed into legislation by Parliament; it is a locally determined scheme that decriminalises the system and provides a system of appeals which, as the two noble Lords who have spoken have indicated, has worked well since it was introduced. The Bill before us would sweep it away and replace it with a more complicated system, which would necessarily introduce a degree of delay. The process that the noble Baroness, Lady Hanham, has described—of forming an intent, telling someone that you might have an intent, then telling them that you have had an intent and giving them an opportunity to make representations and an appeal at each stage—is unnecessarily cumbersome.
The reality is that we are talking about people who are dumping waste. They do so—I have watched it happen, taken photographs and tried to get something done about it. They turn up late at night with a van and they dump a pile of waste somewhere, on the assumption that local authorities will sort it out. The reality is that this is not a process where you need this incredibly complicated system to deal with it. You simply need to pursue those who are offending. What we will create as a result of the Bill is something that will be more bureaucratic and slower, will cost more and will go against the principles of devolution, because it was a system developed by London local authorities in the first instance.
Waste is a big matter—as the noble Lord, Lord Tope, said, “Never go against issues of waste”—and is the third-largest item of expenditure within local authorities. It is a massive part of the business of local government. Here we have a scheme that was developed by London local authorities and that is working well. Now the Government want to come in heavy-handed and against the principles of deregulation and devolution, and impose a complicated, overly bureaucratic and expensive system.
I am sure that the Minister will recognise that Clause 44(6) has crept in by accident, along with its accompanying Schedule 12, and agree to the amendment of the noble Baroness, Lady Hanham, and simply take them out of the Bill so that we can allow the current arrangements to continue. However, if he does not have the authority to agree that tonight, I hope that he will meet with the noble Baroness, myself and others who might be interested, along with London Councils, so that there can be a proper discussion about this before we get to Third Reading. It can then be remedied at that stage, either by the Government or perhaps by the noble Baroness, Lady Hanham, introducing a similar amendment and putting it to the vote.
Lord McKenzie of Luton
My Lords, I can be brief because of the powerful arguments made this evening by the noble Baroness, Lady Hanham, the noble Lord, Lord Tope, and my noble friend Lord Harris. The points they made were extremely telling. It is incumbent now upon the Government and the Minister to try and answer why an approach that is non-localist and bureaucratic should proceed rather than the current arrangements under the London Local Authorities Act 2007. What is the problem with London that this seeks to solve? It is incumbent on the Government to say.
The Government’s focus on this area is all very well, but is it the right priority at the moment? The Minister will be aware of current figures for recycling rates that show that for England household recycling has pretty much flatlined, with a very small increase in the last figures that I have seen. There are real concerns that recycling rates could potentially decline. I would have thought that the Government should be more worried about that than tying up these bureaucratic arrangements that have been so roundly challenged tonight. I hope the Minister will be able to explain very clearly why the Government are where they are on this.
Lord De Mauley
My Lords, I believe that there is broad political consensus that Clause 44 is needed to introduce a fair system of penalties related to household waste collection in England. This new system will treat individuals more fairly than hitherto and deal effectively with those whose behaviour has a negative impact on residents’ local neighbourhoods, such as leaving bin bags on the street for days on end.
The clause removes the current criminal sanctions available under the Environmental Protection Act 1990. The system we propose means that fixed penalties of between £60 and £80 will be available if a person does not present household waste as required and this causes a nuisance or is detrimental to the locality. The clause introduces a “harm to local amenity” test. Civil sanctions will be available to deal with behaviour such as putting waste out in a way that causes obstruction to neighbours, attracts pests, unreasonably impedes access to pavements or is an eyesore.
In Amendments 18 and 19, my noble friend proposes to retain a parallel system in London. We want to change the law so that only people causing real problems for their community will get punished—for example, people leaving bin bags on the street for days on end. The new test of causing harm to local amenity is designed to ensure this. My noble friend’s amendment would enable London boroughs to bypass this important safeguard. That would mean that if a London resident happened to leave a bin lid open or if someone threw the wrong rubbish into someone else’s recycling bin then the householder—that is, someone else—could be punished, in London.
We do not think it appropriate for people to be penalised for a first-time mistake or someone else’s careless action. They should be told what they have done wrong and have the opportunity to rectify their errors. Clause 44 introduces these changes to the Environmental Protection Act 1990. I am confident that this will not add significant burdens compared to how the current arrangements operate in practice. We know that many authorities already communicate well with their residents and seek to educate them if they have difficulties with collection requirements.
Lord Harris of Haringey
Can the Minister tell us how many instances of the cases he has described have led to action under the London local authorities scheme?
Lord De Mauley
I am quite happy to do that. If I cannot do so during this debate, I will let the noble Lord know whatever information I can find for him.
Clause 44 would ensure that this best practice is adopted and that additional safeguards for the individual are available across all boroughs.
I understand that my noble friend is concerned that the process of issuing penalties will take too long. We need to get the balance right between protecting individuals’ civil liberties and dealing with behaviours which damage local neighbourhoods. We intend that this is reflected in legislation. Since the Deregulation Bill was first published in draft, we have amended Clause 44 so that local authorities will not have to issue multiple warnings to people who repeat the same behaviour of causing harm to the local amenity within a year.
We also believe in a fair and measured approach to penalties. A shoplifter committing a first offence may be issued with a £90 penalty notice for disorder. My noble friend’s amendment would levy penalties of £110 for mistakes and carelessness with Londoners’ bins. Clause 44 allows us to set the level of penalties at between £60 and £80 because we do not believe such mistakes and carelessness should be penalised more heavily than shoplifting. I understand my noble friend’s focus on London and know she would like the city to be treated as a special case. However, other cities in England have, for example, high-density housing, transient populations and student populations. I am sure she would accept that a proportionate, fair approach should apply throughout England.
My noble friend asked why the clause needed to be so wordy. We appreciate that the clause and the schedule are long and look complicated. There are two reasons for that. First, we want to be clear about the process that local authorities must go through as we do not want householders to be penalised for a first-time, inadvertent mistake. Secondly, we are looking to align two different systems, set out in the Environmental Protection Act 1990 and the London Local Authorities Act 2007.
To summarise, this clause as it stands will introduce the protection that a household needs from being punished for a simple mistake or for people throwing the wrong rubbish into someone else’s bin. It will align all of England with a sensible approach that keeps residents informed and levels of penalties proportionate.
My noble friend Lord Tope asked whether I would be prepared to meet him about this, and the noble Lord, Lord Harris, asked the same question. Of course I would be prepared to do that, but I would not want to raise any expectation that the Government will change their position on this. I ask my noble friend to withdraw her amendment.
Lord Tope
Is the Minister able to answer the question that the noble Lord, Lord Harris, put to him about the number of prosecutions? As I understand it, he does not have that information to hand. The fact is that in the six or seven years of operating the scheme there has not been one single appeal against the issue of penalty charge notices. Would he conclude, as I do, that that suggests there have been very few issued and even fewer judged to have been unfairly issued?
Baroness Hanham
My Lords, I originally put the question to my noble friend of whether he would be prepared to meet us. He said he will and I thank him for that. I will take up his offer as soon as we can so that we can try and get some sense into this before Third Reading.
I have stood in the same position as the noble Lord, Lord De Mauley, and I have at times thought that the brief in front of me was absolute rubbish. I have to say that I think that this falls into that category. This is not about one person putting a bit of rubbish into somebody else’s recycling bag. This is about bringing into the whole country a decriminalised system of enforcement of waste in relation to receptacles, dustbins and whether or not you put your rubbish out in plain bags. If the five pages plus five pages of schedule on this legislation are intended to amend the problem of one unknown person putting one bit of rubbish into another bag, I think deregulation has lost its meaning.
I will not say any more. I am extremely disappointed with the noble Lord’s response. London has its own legislation on many fronts and it always acts responsibly. It has led the way with the decriminalisation of waste collection and changes to the Environmental Protection Act. It is not just being unfriendly and prosecuting people unnecessarily. The whole nature of what I was concerned about in the noble Lord’s briefing has been misunderstood. I hope that that was what it was. I look forward to meeting him and we will make sure that that happens. In the mean time I will withdraw my amendment.
Baroness Thornton
“Nursery schools: inclusion in schools trusts
In section 18 of the Education and Inspections Act 2006 (alterations that may be made under section 19), omit subsection (4)(f).”
Baroness Thornton
My Lords, as we know, with this Bill we move from waste to education to farms to taxis and now to schools and nurseries. Amendment 20 would enable nursery schools to become full members of trusts and Amendment 21 would ensure that co-operative schools could establish an industrial provident society, should it be desirable, so bringing co-operative schools into line with other kinds of co-operative organisations.
By way of background, I should say that the first co-operative trust school was established just over five years ago. Few would have anticipated the extent of their growth: there are now around 700 co-operative trust schools and that figure is expected to rise to 1,000 by the end of 2015. In other words, more than 250,000 pupils in England now attend co-operative schools. The values of co-operative schools are drawn from the global statement on co-operative identity, which is recognised by the United Nations and forms the basis of co-operative law throughout the world. The co-operative values of self-help, self-responsibility, equality, equity and solidarity, together with the ethical values of honesty, openness, social responsibility and caring for others, have been seen by governing bodies to resonate powerfully with their schools.
Moving to a co-operative model provides a framework in which everybody with a stake in the school’s success—parents, teachers, support staff, local community organisations and pupils—have the opportunity to be involved in running it. There is a growing recognition that working co-operatively helps to avoid duplication and distraction, allows school leaders better to focus on the effective leadership of teaching and learning and raises standards. The value of this kind of collaboration and partnership working between schools was recently examined by the Education Select Committee, whose report highlighted the benefits that collaboration between schools brings, in particular where it is on the basis of mutual benefit.
Examples of these trusts can be seen in Cornwall, where over 100 schools have become co-operatives and are part of 13 trusts. Most of these are geographically based clusters, enabling small village primary schools to be part of a learning community with a secondary school that most of their young people will move to. In Leeds, a significant proportion of the city’s schools are already in co-operative trusts and others are in the consultation process.
The remarkable growth in co-operative schools has happened despite, not as a result of, current government policy. This demonstrates that the models developed under the pathfinder scheme programme following the 2006 Act under the last Labour Administration are enormously attractive to schools.
The reason why these amendments have been put down and I proposed them in Committee is that there is scope within the Bill’s intention—to,
“Make provision for the reduction of burdens resulting from legislation for businesses or other organisations or for individuals”—
to correct two specific burdens on the development of co-operative schools and co-operative school trusts. The first amendment concerns nursery schools. Many co-operative networks and co-operative trusts are based on strong geographically based clusters. They have an all-through vision of education, raising achievement by supporting young people throughout their journey through the education system. Yet the 2006 Act excludes nursery schools from becoming parts of trusts. The amendment would correct this and, in effect, amend the 2006 Act.
Nursery schools are in many ways the most co-operative part of the sector, in relation to both their engagement with parents and carers and their pedagogy, as is reflected in the early years foundation stage. Enabling nursery schools to become full members of trusts or, indeed, academies would provide a vehicle for that parental and family engagement in early years to enthuse the trust to further develop the all-through vision of education essential for sustainable changes in achievement.
The second amendment seeks to amend the School Organisation (Requirements as to Foundations) (England) Regulations 2007 to ensure that schools are able to establish themselves as an industrial provident society, should it be desirable. Despite an all-party commitment to co-operatives and mutuals in the public sector, co-operative schools have had to work around existing legislation, as no provision is made in the relevant education Acts for schools to be established formally as co-operative societies as defined in the 2014 consolidation Act. The new clause seeks to amend this, ensuring that any future legislation provides a level playing field and a more understandable legal framework for co-operative schools—in other words, using the co-operative legislation that exists.
There is a question of the Government’s commitment to co-operatives, mutuals and social enterprises in this area. In a real way, they are disadvantaged because they cannot use the legal form that exists for co-operatives. This issue was first raised in the Commons during the first part of the discussion about the Bill. The amendments were withdrawn then on the basis that there would be discussions with the Department for Education. While Michael Gove was the Secretary of State, he was personally supportive of the proposals but said that the department lacked the expertise and resources to adopt the changes. Since his departure, there has been what you might call a decided lack of enthusiasm about the issue in the department. We are told that the department would like to work with co-operative schools to help with these proposals, but that has yet to happen. I am not hopeful that the Government will accept the amendments now, but I would like to see some sign that progress can be made in this important matter. I beg to move.
Lord Wallace of Saltaire
My Lords, the Government have been, and continue to be, supportive of the broad aims of partnership, collaboration and co-operation in education, as in other fields. I have been a long-standing supporter of the Co-operative movement and I was sorry to see its decline in the north of England over the last 30 or 40 years, just as I am glad to see that in many ways it is now reviving. I am a member and a regular user of the excellent Co-op shop in Saltaire and I was on the point of considering moving to the Co-operative Bank before its recent sad problems.
We all recognise that mutuals are model forms of enterprise that we need to extend across a whole range of fields. As I deal with elderly relatives, I think that we all need to work much more actively to develop mutual models for care homes. As far as schools are concerned, we know that partnerships between schools can be a powerful tool in raising standards and improving educational achievements for all pupils and we place great value on that.
The academies programme continues to deliver examples of schools working together in multi-academy trusts, which help to ensure success for everybody in those partnerships. These trusts pull together schools across both phases of education to work effectively as a family of schools. There are currently 260 multi-academy trusts which have both primary and secondary provision, so it is not simply primary schools working with primary schools and secondary schools working with secondary schools. We are promoting collaboration across the sector and we see the benefits across the educational landscape.
Baroness Thornton
Why does adding provident societies to the sort of business forms that schools can have in legislation make anything more complex? It is not a complex question. It is a simple question; it is straightforward. We are just asking that co-operative schools can have the legal form that co-operatives have. That is all.
Lord Wallace of Saltaire
My Lords, we have been open to discussion and we are still open to continuing discussion on what precise forms are needed, but we want to be persuaded of the educational advantages of the changes that have been proposed and we would want to be assured of the advantages for schools before we were to support these very specific amendments. In line with the Government’s undertaking given in the other House to investigate the proposals—
Baroness Thornton
Would the Minister like to tell me exactly where in the legislation creating academies it says that companies limited by guarantee bring better educational results?
Lord Wallace of Saltaire
My Lords, I take the point that the legislation does not specifically say that. I was in the process of saying that we are open to discussion. We offered to investigate the proposals further and my noble friend the Parliamentary Under-Secretary of State for Schools met interested parties to discuss their concerns last year. He also wrote to the noble Baroness in November last year, inviting her to provide evidence about the problems that these amendments would address and to meet to discuss the issue further. We regret that that meeting has not been held and we are still open to further discussions, but, in consequence, the position has not changed and he remains unconvinced of the educational benefits of the noble Baroness’s case.
The Government are determined to continue to remove the barriers and obstacles that prevent schools delivering the best education possible for their pupils and to promote flexible and collaborative ways of working such as the amendments are intended to promote. So far, more than 700 co-operative schools have been established and, as the noble Baroness said, there will be 1,000 by the end of 2015. We firmly believe that there are sufficient alternative options already available without needing to introduce these additional legislative changes, but we are open to continuing discussions about the obstacles that the noble Baroness and others clearly think still exist. In the mean time, and in openness to further discussions, I urge the noble Baroness to withdraw her amendment.
Baroness Thornton
I thank the Minister. I know that he is sympathetic. Indeed, we shop at the same Co-operative store in Saltaire—and a very good shop it is, too. I have been a member of the Co-operative society in Bradford since I was 16 years old. I am grateful for the offer of further discussions and my Co-operative colleagues from the Commons and this House will certainly take the noble Lord up on that offer, because there are issues to do with equity, a fair playing field and recognition of different business types. I think that we would all agree that plurality in those issues is important. In the mean time, I beg leave to withdraw the amendment.
Small Businesses
Lord Risby
To ask Her Majesty’s Government what steps they are taking to encourage the growth of small businesses in the United Kingdom.
Lord Risby (Con)
My Lords, the statistics regarding small businesses are truly remarkable. Small businesses account for 33% of turnover in the private sector and employ 12 million people. Of our country’s 5.2 million private sector businesses, those with fewer than 50 people account for 99.3% of the total number.
For many years I have been deputy chairman of the Small Business Bureau. In November, a number of our directors produced an SME manifesto called “Liberating the Entrepreneur” under the Genesis Initiative. I pay tribute to the many parliamentarians of all parties in both Houses of Parliament who have highlighted the needs and potential of our small businesses over the years.
I most warmly welcome the Small Business, Enterprise and Employment Bill, which deals with key areas, such as access to finance, regulation, public sector procurement and filing requirements. This, of course, builds on the Government’s publication, Small Businesses: GREAT Ambition of December 2013.
The increase of over 40% in the overall business population since 2000 has been driven by SMEs. In turn, that figure was driven largely by the increase in the number of businesses without employees—for example, sole proprietorships, run by one self-employed person, or ordinary partnerships, run by two or more self-employed people. Most of the growth in non-employing businesses comes from unregistered businesses. The smaller ones not registered for VAT has increased by 83% since 2000. This trend arises from the possibilities offered by modern technology and communications.
The Government have plans, which I applaud, to extend superfast broadband, but it is a question not only of cover but of the quality of the cover. A note that I received from the City of London Corporation indicated this to me. Many SMEs in and around the City do not have access to the superfast broadband required to boost their growth and, while larger businesses are able to afford dedicated fibre optic broadband, the needs of SMEs have been overlooked by the large telecoms companies. As a result, average speeds for SMEs in the City are half that of the London average. Given that, and considering the particular impact on small and microbusinesses of broadband, I would be grateful if my noble friend could indicate what percentage of the UK will be covered by at least one of the four main networks and by when, and how we deal with areas where broadband infrastructure may not be commercially viable.
Inevitably, following the financial crisis and a change to the regulatory framework, lending institutions became very cautious. Over the years, we had seen the growth of a concentrated banking structure in this country. In 2007, at the peak of business lending, there were perhaps only 100 lenders to business; that number then halved, but today there are at least 300. I greatly welcome the vast number of government schemes and assistance under the umbrella of “providing finance and support for your business”. However, many feel that all that can be confusing and time-consuming for a small business owner. Therefore, the issue is not only the availability of funding but awareness and access; a recent survey indicated that only 6% of SMEs are fully aware of the whole array of borrowing possibilities. Is my noble friend confident that the now vast range of funding available for business is being made available on a clear, easy to access basis, and does he envisage some further improvements in enhancing access and clarity of information?
While it is true that interest rates remain very low, and general corporate profitability has much improved, the issue of late payment remains a continuing burden. The FSB has indicated that some half of the invoices of its members are paid late, persistently. Additionally, of course, suppliers remain nervous about pursuing larger businesses, for very obvious reasons. It is good to have a new reporting regime to help small business to identify best payment practices, with attendant benchmarking. However, it is very daunting for a small business to deal with the might of a major purchaser. Is my noble friend satisfied that, by giving smaller businesses more rights to challenge unfair terms, that problem will be reduced? While I greatly welcome the strengthening of the prompt payment code, would it not be advantageous and very reassuring for SMEs to have a small business conciliation service to resolve those disputes?
With their Red Tape Challenge, the Government have sought to address needless regulatory pressures. It is gratifying that the World Bank’s Doing Business 2015 report showed us as eighth out of 189 economies—up two places—as domestic regulation has been reduced. However, given the considerable impact of EU legislation on businesses, can my noble friend confirm that the Government are pressing for an annual statement of the true cost of EU regulation and legislation? That would certainly be advantageous to all EU members in a generally static European economic environment, which of course impacts on us, too.
I salute the substantial increase in direct lending finance by UK Export Finance and the package of support for first-time exporters. As somebody who is involved with UKTI, I find the new and functionally improved emphasis on highlighting what is available to support SME business activity abroad most encouraging.
In 2014, the House of Commons BIS Select Committee identified business rates as the main threat to the survival of existing retail businesses on the high street, and the biggest obstacle to entrepreneurial new retail businesses starting up. Business rates on the retail sector account for 25% of taxes on domestic property, and many small businesses pay more in business rates than they do in rent. The introduction of the 2% cap in 2013 certainly recognised that. The next revaluation is due in 2017. There have been suggestions that property revaluations should be more frequent. Perhaps my noble friend can comment on whether there are any thoughts in place for a long-term reform of business rates, particularly for small companies.
SMEs feel better supported today than at any time—which is absolutely excellent news. As I know from personal experience, starting a business is very daunting, and to grow that business requires confidence in both economic environments and growth, and a pro-business atmosphere. It is significant that this country has been such a magnet for many young people from neighbouring countries where youth unemployment is shockingly high, and where in some instances anti-business sentiment and policies apply. Tech City is a brilliant example of attracting business-minded young people from all parts of the United Kingdom and abroad.
Of course there have been differences, but essentially a message has gone out from this Government and from the previous Government that Britain is open for business, and that spirit has prevailed in debates about current business legislation and in the export debate last week. Recently, however—I feel compelled to say this—some senior political figures have taken to attacking business and successful businesspeople. Those comments have been ill judged, and I hope will cease on sensible reflection, because they undermine the vitally necessary pro-business message in this country and, quite frankly, they are profoundly counterproductive.
Lord Cavendish of Furness (Con)
My Lords, the House is indebted to my noble friend Lord Risby for introducing this short debate. As he said, the contribution that small business makes to our national life is now, finally, well understood and appreciated. As the Federation of Small Businesses points out, 99% of our nearly 5 million businesses are small or micro—another point my noble friend made.
In contributing briefly this evening I declare an interest. I recently relinquished the chairmanship of a group of small businesses based in south Cumbria, details of which can be found in the register. Perhaps more importantly, I will not disguise from your Lordships the fact that these family ventures will be seeking strenuously to participate in the very considerable investment that is being directed towards the Furness peninsula, where I live. It is anticipated that over the next decade some £40 billion will be spent in the area, including civil nuclear, biopharmaceuticals and energy projects, and providing national security in the shape of the next generation of attack and deterrent submarines.
The question is: will small—or indeed medium-sized—businesses benefit from those large investments? That is not an idle question; in the past, very little indeed has trickled down, and there has been a pitifully small number of consequential start-ups. Part of the problem is cultural: big corporate businesses feel naturally more comfortable dealing with organisations of comparable size and structure. We must all seek to change that. There is also an ugly element, which can be found especially, in my experience, among what I might term the large private monopolies. They dread small, agile competitors muscling in on their territory, and resort to sometimes quite ruthless measures to see them off.
Local participation is reliant on the agencies set up for the purpose of promoting growth in the local economy being in good shape. South Cumbria has had the benefit of such grants. Most recently, I thank my noble friend Lord Popat for his role in supporting Furness Enterprise’s bid for money from the Coastal Communities Fund. That has been crucial in allowing that simply excellent organisation to continue with the work it does for small businesses.
In one area especially, it is my contention that there is scope for government to influence procurement policy and help the local economy. BAE Systems in Barrow has made some encouraging statements in respect of local involvement and has been extremely approachable. However, once the tendering process gets under way and outside contractors become involved, my fear is that the interests of the local economy become diluted. In the case of the expanding and modernising of the shipbuilding facility, I understand that the Ministry of Defence has a substantial direct investment. Therefore, will my noble friend ask his colleagues in the Ministry of Defence to ensure that their own guidelines in respect of local procurement are followed?
The benefits of these policies were described very well by my noble friend Lord Shipley, who I see is in his place, in a compelling contribution that he made on 23 October last year, when he pointed out that,
“profits accrue locally, training is provided locally and local labour is recruited—there is a local legacy”.
He went on to ask,
“whether the Government are content with the current operation of framework agreements”.—[Official Report, 23/10/14; col. 784.]
I hope that I have not pre-empted too much but I think that that very important point bears repetition and I hope that my noble friend will press the point.
Good practice in the matter of procurement really can deliver enduring benefits to an area and provide strength and resilience against the ebbs and flows of global economic conditions.
Lord Shipley (LD)
My Lords, I welcome this opportunity to say something about the importance of small businesses to our economy and to growth, and I shall be saying some things very similar to what was said by my noble friends Lord Risby and Lord Cavendish of Furness. I want to address in particular issues around business rates, public procurement policies and problems caused by late payment, all of which can be barriers to local growth. I declare my vice-presidency of the Local Government Association.
On business rates, I think that we would all agree on the vital role that small businesses play in their local economies. It is clear that some small firms and businesses feel penalised by business rates in their current form, not least in the retail sector, where they can face enormous competition from the internet. Retail businesses trading from premises rather than online can be unfairly penalised by business rates, particularly at their current levels.
I noted the announcement in the Autumn Statement of a review of the future structure of business rates, which is most certainly needed. I hope that we will get a much more flexible system that would allow councils greater discretion to support the economic growth of small businesses.
On procurement policy, I agree entirely with what my noble friend Lord Cavendish of Furness said, and I hope that the Government do not plan to use powers in the Small Business, Enterprise and Employment Bil1 simply to centralise procurement more and introduce a one-size-fits-all approach. That would not help local government's support for local small businesses and voluntary organisations. We should note that half of local government’s total procurement spend is with SMEs, compared with around 15% for central government. We have already seen the impact of centralised procurement in some areas, such as construction, which can advantage national companies rather than regional or more local companies, which employ and train a long-term local workforce.
I share particularly the concerns of my noble friend Lord Risby about late payment. I know that the Small Business, Enterprise and Employment Bill currently being considered in this House is attempting to address some of the problems of late payment, which can impact on the viability of small businesses and in turn on their growth potential. I note that there will be a requirement for companies to report payment practices towards their business suppliers. I am pleased, therefore, that the Department for Business, Innovation and Skills is now developing a better understanding of the payment practices across different industrial and commercial sectors and is assessing whether to take action sector by sector to encourage better payment practices. At this point, I welcome the work of the construction industry in its fair payment commitments, with its clear plan for delivery of reduced payment timescales over the next 10 years. I wish them well. This is not a matter just for central government; it is the responsibility of everyone. In some cases, the pressure placed on the finances of businesses can be so great that it can result in bankruptcy.
I would like to draw attention, at this point, to the valuable role of the North East Institute of Business Ethics, which was established in May 2013 as an independent regional resource to encourage responsible business behaviour. It encourages regional firms to adopt a fair and ethical approach towards their supply chains. I welcome strongly the Pay Fair campaign; through the Journal newspaper, the local press is encouraging north-east companies of all sizes to take a responsible and ethical approach to paying firms within their supply chain. The problem is that, in a contract with 30-day terms, some will inevitably pay late. In the UK, the average payment was 15 days late. The Federation of Small Businesses says that, on average, its members in the north-east of England are owed around £40,000 and are waiting eight working weeks to get paid. It also tells us that it costs in the region of £100 million a year for small businesses to chase payments. Clearly, if more companies paid on time, it would really help other companies and the economy more generally.
Baroness Byford (Con)
My Lords, I thank my noble friend Lord Risby for securing this Question for Short Debate. I will not repeat the figures that he gave at the beginning but I agree with him that Britain is open for business. I have a farming business in Suffolk, which would be considered small; as my noble friend will know, more than 50% of small businesses are based in rural areas.
The Government should be congratulated on the way in which they have encouraged small business. The Autumn Statement announced some £400 million through the venture capital funds investment and some £500 million through new bank lending and through the enterprise and financial guarantee scheme, which required 75% of bank loan, with the lenders having to put up 25%. I could go on but I will not.
I turn quickly to apprentices, because the growth of small businesses can be enhanced by young people. Again, the Government have put an allocation of £170 million aside for youngsters between the ages of 14 to 16 and between the ages of 16 and 24. That encourages youngsters to get involved in business and to go on from there and, it is hoped, to become involved in small businesses in their own right. In hindsight, nearly 100 years ago, my father-in-law, who was a farmer’s youngest son, set up in Leicester, with two machines and two men, employed in the sock business; he eventually employed just under 2,000 and exported some 50% of all the socks he made. Exports are hugely important to this country and, indeed, to small businesses. Although others have not touched on it, I hope it is something that the Minister will be able to reflect on.
Secondly, as has been referred to by others, the Government, through legislation, are looking at deregulating as much as they can, thus freeing up small and medium-sized businesses to be able to get established in a much sounder way. With that, obviously, comes the question of late payment, which still needs to be addressed. Where breakdowns occur—such as in the farming and food industries—we have the groceries adjudicator. It is a very sad reflection on business that that is actually needed, but a wise move. What we need are powers to fine.
Finally, on the general side, I turn to businesses in rural areas. Many of them start up as one-man businesses and then grow a little, but what is key to all of them is broadband, as has been mentioned. In some areas, it is not a question just of broadband quality; it is actually getting broadband access in the first place. Linked to that is the question of enabling local companies to put in for public procurement tenders, where they will have a chance locally. I think that some opportunity is being missed. On the other hand, there are some very good examples of what is actually being done. The important thing is that people are encouraged.
I congratulate the Government on what they have done. There is still much to do: let us not forget exports—they are the lifeline for us in this country, in the past and in the future.
The Lord Bishop of St Albans
My Lords, there is no doubt that we need to create a culture in which entrepreneurial skill is encouraged and supported. Small businesses form a vital part of our national landscape and are integral to the flourishing of our society. The social capital that we all seek depends on strong partnerships: partnerships between manufacturing, finance and chambers of commerce; between new entrepreneurs and established businesses; and between local and national government and the universities, as well as the voluntary and faith sectors.
Last evening, I was at a social function and found myself talking to Peter Goodman, the president of the St Albans District Chamber of Commerce. It was too good an opportunity to miss so I asked him what he thought about small businesses. In particular, we ended up discussing start-ups. He identified three main problems that small business start-ups were facing in St Albans. First, he said, there was insufficient advice for small business in the early stages. I therefore ask the Minister whether Her Majesty’s Government can help with better signposting of the business advice that is already available, and whether additional specialist resources could make a significant contribution, especially in emerging areas such as the high-tech industry.
Secondly, Paul Goodman said that it is hard to recruit staff with the appropriate qualifications and, thirdly, that there is a dearth of appropriate premises for small businesses and a need for many more “easy in, easy out” licences. These are areas that I hope Her Majesty’s Government will review carefully as we want to support new business start-ups.
Allied to these challenges is the clear need to improve access to start-up capital for small businesses. With the diversification of financial services, social investment has the potential to provide an alternative way forward for many would-be entrepreneurs. Community development finance institutions are among the social finance options available. They provide loans and credit to, among other groups, businesses and entrepreneurs, especially in disadvantaged communities, which are unable to secure finance from mainstream commercial institutions such as banks. Community finance seeks to bring about a range of economic and social benefits and is not limited to a concern with profit margins.
While this is a fast-growing sector, current levels of community finance provision leave a huge gap in capacity, skills, expertise and availability of capital. The Community Development Finance Association’s recent report Mind the Finance Gap highlighted the extent of the disparity between demand and provision.
As well as the DCLG’s work in encouraging social impact investment, have the Government given any consideration to supporting the growth of the community finance sector? In particular, are there ways in which Her Majesty’s Government can further assist in bringing together the banking, public and independent sectors to work more closely with each other in providing funding for small businesses?
Lord Leigh of Hurley (Con)
I congratulate my noble friend Lord Risby on securing this debate. As we have heard, small businesses are the lifeblood of our economy. Small businesses are often worthy of our praise, just as they are deserving of policy support from government. I declare my interests as recorded in the register of interests.
The register shows that I have started a small business which, 26 years later, remains a small business, sadly, but, none the less has a modicum of success and is not to be confused with my noble friend Lord Cavendish, despite the similarity of name. So when I heard the leader of the Opposition suggest scrapping our proposed reduction of corporation tax for large businesses to support a rate cut for small businesses, I realised that the right honourable gentleman had missed the point entirely and had misunderstood the mentality of the entrepreneur and the small businessman. The point is that many small businesses do not want to stay small. They want to grow, open new sites and stores, invest in new products and hire new staff. As anyone who is concerned with the state of the public finances—we on these Benches certainly are—will know, larger businesses pay more tax. I am pleased to say that this Government have recognised this point and introduced a succession of targeted measures throughout this Parliament to assist SMEs. We have seen entrepreneurs’ relief increase dramatically from £2 million a year to £10 million a year in tax-free lifetime gains—or tax at 10% for lifetime gains—meaning that founders and entrepreneurs can keep more of the wealth they have created by taking a risk and starting a new business.
As has been mentioned, the start-up loans scheme has helped thousands of individuals start their own businesses, often moving people away from welfare and into their very first new business. So far it has made 25,000 loans worth some £130 million. As the Federation of Small Businesses has said, this Government have made it easier not just to start a small business but to run one. In particular, the changes in the laws on employment tribunals and extending the qualifying period for unfair dismissal will help individuals by giving them more opportunities to enter the labour market, and mean that employers such as me will take a chance and employ an extra person. We in Britain now benefit from one of the most liberal labour markets in the developed world and one of the world’s most competitive tax systems. The Government have abolished Labour’s jobs tax, cutting employer NI by £2,000, meaning that 450,000 small businesses—that is nearly one-third of all employers—pay no jobs tax in the current financial year.
As has been mentioned, the Government are committed to helping further through their powerful procurement footprint, securing 25% of all spend going to SMEs. But there is still more to be done. I would welcome the Minister’s comment on the recent study by the Association of Accounting Technicians, which has found that the UK’s complex tax system is costing SMEs £9.9 billion a year in compliance, whereas it costs larger firms only £100 million. I note the work of the Office of Tax Simplification—it is looking to simplify our tax code to make it easier—and only encourage it to look particularly at aspects affecting small businesses.
As we encourage people to found and work in small businesses and make them cheaper to operate, we must help them grow by encouraging more investment and, of course, exports. It is pleasing to see the Prime Minister take a personal interest in that in promoting SMEs on all his trade trips. The enterprise investment scheme has been expanded to offer tax reliefs of 30% for the investor— up from 20%—and the aggregate limit to which a single company can take such investment has increased from £2 million to £5 million. Likewise, for companies using money from venture capital trusts, the individual company limit has increased to £5 million, as opposed to £2 million previously, and the maximum number of employees for eligible companies has increased from 50 to 250.
We have incentives and encouragement to start a business, help in bearing down on costs and policies to help businesses grow. This represents a joined-up approach to business policy, one that understands the complete business ecosystem and, in particular, the challenges and opportunities of running a small business that wants to grow and one day become a large one. It is no wonder that businesses are lining up to point out how disastrous a change of government could be for SMEs, the economy and the country.
Lord Empey (UUP)
My Lords, I, too, congratulate my noble friend Lord Risby on securing this debate.
I want to focus on trade issues and the contribution SMEs can make to our economy. A recent statement from the European Commission forecast that the UK is on course to record the worst trade deficit in the industrial world in 2014. Howard Archer, chief UK economist at IHS, said that trade was unlikely to be a major driver for UK growth in the near term.
Even a superficial examination of our trade statistics illustrates that, even with our exports to partners in the European Union, we are achieving a monthly deficit of up to £3 billion, £4 billion or £5 billion a month. This has gone on since the 1980s, which was the last time that we had a trade surplus in this country. If the same statistics were coming out of the health service or our education service, there would be a revolution in this place. We are sleepwalking our way through the fact that we are living and paying our bills by doing two things. First, we are selling our assets. Secondly, we are borrowing. That, added to what we do sell, is how we pay our bills. How long can that go on? SMEs are where the solution lies, because we have proved conclusively that reliance on the large corporations is no solution.
I have asked my next question on a number of occasions but never had a clear answer to it. I hope that the Minister will tell us whether we as a country have any policy on import substitution. If there is one, I would like to know what it is. I have never heard it. We are ignoring something vital. It is not that we support the production of articles that are completely unprofitable but we can do things in this country on the land, in manufacturing and in our services that are done elsewhere that I believe we could do just as well here.
The second thing is really a training issue. We say that we are committed to exports and that we want to see small companies and others take the leap and start to export. But do we? For instance, we train our dentists and doctors. Would you send a car to a garage that had no trained mechanics? However, we are perfectly happy to try to see exports grow in companies where there is no training for people to export. I am a vice-president of the Institute of Export, an educational charity providing training for people in business so that they understand what exports are, how they do them and the pitfalls. Surely it would be possible for government to give an incentive, even through a capital allowance, for people to be trained in export qualifications, so that the small companies at least are encouraged, and so that we send a signal as a Government and a country that we are serious about trade.
These figures, which have now been going for 30 years, indicate that we are not serious about trade. We are prepared to run huge deficits almost indefinitely and pass on a huge burden of debt to the next generation. I hope that the Minister can address those issues in his response.
Lord Freeman (Con)
My Lords, I, too, congratulate my noble friend Lord Risby on securing this debate. He is a former colleague of mine with a long and distinguished record for East Anglia in the other place. I think your Lordships owe him a debt of gratitude for the time to discuss this very important issue. I want to concentrate on advisory support for high-technology companies, particularly small technology companies, for which the failure rate in this country is far too high. It is not about the absence of finance, but about experience and knowledge being passed on, in particular from government. That is the burden of my brief comments.
My experiences in high-tech small companies stem from my chairmanship of Cambridge University’s technology transfer office and my chairmanship of the Security Innovation and Technology Consortium, which has more than 100 members of small firms in the high-technology field. I am pleading on behalf of that small but important proportion of small high-tech companies that fail because of a lack not of finance but of guidance and help concerning their ambitions and the direction of travel that they have chosen. In some cases it may be correct—it may result in substantial benefit to the United Kingdom—but in others it can be misguided.
The burden of my comments is that we need better to capitalise on the tremendous wealth of experience and knowledge of some of our smaller high-technology companies and make sure that they do not end up in a blind alley. I have great admiration for the American Research and Development Corporation in Massachusetts, which over the years has nursed and encouraged smaller firms which have grown to very large entities in the United States. It has a very good track record.
My plea to the Minister is: can he please communicate with the Department for Business, Innovation and Skills and suggest that it might create and sponsor a group of technology experts drawn from many industries, but those that particularly depend on high technologies, to act as advisers and guardians of the technology—not of the wealth of those individuals? They could provide a bit of sober advice to say, “Have you thought about this technology, which might now proceed at a pace in Japan, the United States or on the continent?”. Some of these small companies, which might have a tremendous future in front of them, might fail and fail badly, simply because of that lack of advice. We should emulate not only the United States but Germany, which has the right institutions to cover the point I made: not only financing but the intelligence network of experience in particular fields. We have the brains in this country, but in this case we need a few wise uncles—some from the Department for Business, Innovation and Skills, I hope.
Lord Borwick (Con)
My Lords, I thank my noble friend for raising an important debate. I declare my interests in several small companies. I have run several businesses. I have always found it quite thrilling: the chase after a new customer, a new product or a profit—that is real fun. The best thing that government could do to encourage business is to show that government understands business by running government the way a businessman would. The best thing to inspire business is to get the background of the country right, with low taxes and certainly with underspending, but also with respect for business and enterprise; a supply of smart, numerate school leavers who can read and write; and a culture that applauds success and encourages failures to try again.
The general health of the UK economy is improving, with good figures on growth and jobs. It is interesting, however, to find out exactly where that growth and job creation is coming from. Last year, a report by the Centre for Economics and Business Research, commissioned by Octopus Investments, found that 68% of employment growth and 36% of economic growth was created by just 1% of UK businesses. These businesses are all high-growth small businesses with an annual turnover of between £1 million and £20 million. It is quite remarkable: small businesses really are driving the economic recovery.
The Octopus Investments report suggests several ways in which we can further support the sector. One of those is allowing corporation tax deferral in order to provide more capital investment to support growth, along with other tax breaks. The report also suggests an overhaul of regional funding. I think that low, simple and predictable tax rates for all businesses are preferable to tax breaks and funding through grants.
We could also do more on business rates, which are often higher than rents, and employers’ national insurance, which stops firms hiring more people. Some good things have been done. If, however, we are to implement tax breaks, they should be targeted at high-growth small businesses.
Overall, when I read reports like that of the CEBR and take part in debates like this, I am heartened to be reminded just how entrepreneurial this country is. I want that to continue. A big part of it will be inspiring young people about the world of business. There are great examples of organisations looking to engage young people and interest them in business. Indeed, every year 180,000 young people in England and Wales take on a real business challenge with Young Enterprise, an educational charity that I support. Mentored by a member of the local business community, they find out first hand what running a business involves and how much fun it can be. I have had the pleasure of meeting many of the wonderful young people who have done well in their competitions, and I hope that they all go on to start a high-growth small business. Young Enterprise plans to be in 50% of secondary schools this year. It should be in all of them.
Lord Mendelsohn (Lab)
My Lords, I draw attention to my entry in the register of interests, which includes my current involvement in small businesses.
I congratulate the noble Lord, Lord Risby, on securing this debate, and on his excellent speech. I commend also the excellent comments across your Lordships’ House on a range of issues, including payments, finance and procurement. This has been a very interesting debate and raised important issues.
It is incredible that for a long time we have not had a much greater focus on small businesses. If the past is any guide to the future, in the next decade small firms will create most of our country's new jobs. Research has shown that over the past 20 years small businesses have created the majority of new jobs, and that has really been in businesses with fewer than 50 employees. Small firms have increased their share of total employment, too: their share of jobs was three times that of 1998.
We also need to understand that small businesses are not all turbocharged start-ups ready to explode with growth in the right circumstances and a bit of luck. Of new firms, 75% that start small stay small. As MORI has pointed out, however, some worrying trends are emerging. Surveys have shown that entrepreneurs with high growth ambitions have declined in Britain since 1999. This is very worrying. While the internet has provided for a huge proliferation of commercial activity, it appears that entrepreneurs are worried that the UK is not an easy place to scale from.
To make sure that we meet the requirements for supporting growth companies, we need more attention on access to finance, whether it is start-up capital, growth capital or working capital. We have an unusually low level and small amount of early-stage venture capital and a still sub-par banking sector. We need to use regulation to level the playing field for small businesses that operate in markets with power, economic and informational imbalances and asymmetries. We need a more aggressive use of public sector procurement to trigger the benefits of using small businesses and to support their access to export markets.
We need to look at particular sectors and how they are developing, and to see what we can do. I commend the excellent work of the Creative Industries Council, which has brought forward a very impressive strategy, involving government and industry, to develop the creative economy, which is dominated by small businesses. Of the UK's total workforce, 2.6 million—that is 8.5%—are employed in the creative economy. On average, employment in the creative economy grew over three times faster than in the UK overall. Growth stands at 10%, more than three times that of the UK economy as a whole, and higher than any other industry.
However, initiatives to open employment opportunities to young people are as important—and probably more important—as engines of employment growth. We are very impressed with the Apprenticeship Ambassadors Network and the work of its chair, David Meller, who has helped to make apprenticeships more accessible to small businesses.
Government should not be afraid to be a market catalyst, to provide an economic and political framework of stability and pro-business character. We must not, however, make the mistake of believing either that one size fits all or that we can intervene in every market. Public policy must make sure that local businesses with more modest ambitions and dynamic start-ups both get the sort of bespoke and customised attention that they require.
The Labour Party's adoption of a more assertive and aspirational role for public policy in supporting small business is really the legacy of Nigel Doughty, who led the Small Business Taskforce, established in 2011. Nigel tragically passed away nearly two years ago today, on 4 February. He was one of the most accomplished and visionary businessmen this country has ever had, and his tragic passing has robbed this country of someone who would have made an extraordinary and even greater contribution. His report remains required reading. It also shows how far we have drifted behind key international competitors in responding to current challenges and the type of agencies that would make government more effective.
We all welcome the Government’s small business Bill. The discussions we have had on that have shown that we all agree that it is a good start. However, I hope that the Minister takes this discussion as encouragement, as we move to Report, to strengthen its provisions in some key areas.
Lord Popat (Con)
My Lords, I am grateful to my noble friend Lord Risby for initiating this important and timely debate. He speaks from great experience and I commend his interest in small businesses. It is an honour and a privilege for me to respond to a debate on my favourite subject and I commend organisations such as the Federation of Small Businesses and the British Chambers of Commerce for the work that they do.
Perhaps noble Lords will permit me a moment of self-indulgence. For some 30 years before joining your Lordships’ House, I was a small businessman and I am the third generation of my family to start and grow a small business. My grandfather, Haridas Hemraj, was a jute trader. My father, Amarshi Haridas, was a shop owner with a sub-post office. I initially followed in my father’s footsteps as a sub-postmaster before a career in accountancy, specialising in business and corporate finance, so business is very much in my DNA.
It is one of life’s great satisfactions to start and run a business and I am proud to have been a member of a Government who have done so much to support small businesses. This Government recognise the importance of small businesses, which are the engine of our economy. The UK economy is recovering from the biggest financial crisis in generations and I would like to share what we have done so far and what we are doing to help small and medium-sized enterprises, which I will refer to as small businesses from here on.
Let me talk first about the fiscal incentives. We have cut corporation tax from 28% to 21% and announced a further cut to 20% by 2015, the joint lowest rate in the G20. For small employers, there is a £2,000 cut in national insurance bills with the employment allowance. We have extended the small business rate relief for a further year from April 2015. Small businesses that are starting up or relocating to an enterprise zone will qualify for enterprise zone relief. They can get up to 100% business rate relief for five years, up to a maximum of £275,000. In the last Budget, the Chancellor doubled the capital allowance from £250,000 to £500,000 until December 2015.
Moving to banking, a number of noble Lords mentioned concerns over finance for small businesses. For too long there has been an overreliance on our four biggest banks, which between them account for 85% of business current accounts. We have introduced many measures to help small firms to have access to finance. We have increased competition in the banking sector, we have increased the availability of credit through the Funding for Lending scheme, and we have finally established the British Business Bank. On competition, two new banks are being spun from Lloyds Bank and RBS, while other challenger banks such as Metro Bank, Aldermore and Cambridge & Counties are also growing. There are a further 20 applications for new banking licences in the pipeline, so it is hoped that with more competition, our SMEs will be able to access finance more easily than they are able to do at the moment.
The Financial Services (Banking Reform) Act has created a payment systems regulator to ensure that the UK has a payment infrastructure that supports a competitive banking sector. The Government are also taking very practical steps to help small businesses to access alternative sources of finance. The Autumn Statement announced an upgrade to the seven-day current account switching service to include 99% of all small businesses. Provisions in the Small Business, Enterprise and Employment Bill will require the banks to refer small business customers who have been declined a loan to alternative lenders via designated platforms. So far, the overall lending picture is encouraging. Gross lending to small businesses in the year to the end of 2014 was up by 25% on the equivalent period in 2013. Some 66% of new finance applications from small businesses are now successful, from a low of 33% in the first quarter of 2013.
We have also launched the British Business Bank, which has facilitated a total of more than £890 million of new lending and investment to over 21,000 small businesses in the year to the end of September 2014. Last month the Prime Minister announced the 25,000th start up loan, which means that more than £129 million has been lent to people of all ages who have made the leap to start their own business.
As the noble Lord, Lord Empey, has just said, one of our long-standing economic weaknesses is our record on exports. We do not export enough to pay for our imports. I can recall that in 1971, when I was a 17 year- old, Harold Wilson wanted Edward Heath to resign because we had a deficit of £14 million. I am glad to have shared over dinners and discussed in corridors what more we can do to help in the export effort. Currently, one in five SMEs exports, but if we can change that to one in four, we will be able to clear our trade deficit.
When I came to your Lordships’ House, one of the first things I did was set up an ad hoc committee, chaired by my noble friend Lord Cope, to see what more the Government could do to help SMEs export more. The committee, of which the noble Lord, Lord Empey, was a member, took evidence from all over the country, and went to Brussels. The committee published a report in 2013, to which the Government responded positively and they have since launched a number of initiatives. In the last Autumn Statement, the Chancellor announced further financial support for UKTI. In 2013-14, around 48,000 businesses were helped by UK Trade & Investment trade support services; nearly 90% were small businesses. This support helped generate additional sales of more than £49 billion and created or safeguarded more than 220,000 jobs. The Government have also provided a further £20 million to help companies export for the first time. UK Export Finance also continues to support exporters with a network of regionally based export finance advisers who help businesses with risk and trade finance issues. UKEF’s trade finance and insurance solutions products have provided more than £1 billion of support to UK exporters of all sizes.
The Small Business, Enterprise and Employment Bill, which I have enjoyed debating with the noble Lords, Lord Mendelsohn and Lord Stevenson, and on which I have had the pleasure of working closely with my noble friend Lady Neville-Rolfe during its progress through this House, contains measures that will open up new opportunities for small businesses. More specifically, the Bill will support small business in a number of areas including improving companies’ payment practices and helping to tackle the issue of late payments. The noble Lord, Lord Shipley, had strong views on this. I am pleased to confirm that a summit was held this morning at Downing Street attended by the Federation of Small Businesses and the CBI. The Bill will also improve access to finance. It will assist small business expansion overseas and streamline public procurement to help small businesses gain fair access to the £230 billion public procurement market, which my noble friend Lord Cavendish mentioned. It will cut down on red tape and will also help to support home businesses and streamline small company filing requirements. The Bill will reduce the barriers that can hamper the ability of small businesses to grow and compete and will pave the way for Government to be more supportive of, and less burdensome to, small business in the UK. I look forward to the support of the Opposition when the Bill has its Report stage.
Infrastructure investment will help small businesses, which need to be able to operate in an environment that allows them to flourish. The Government are trebling investment in major roads schemes by 2020-21, the biggest investment in roads since the 1970s. Under way is the largest programme of investment in the railways since Victorian times. Crossrail, electrification, HS2 and HS3 all show our commitment to secure a step change in Britain’s connectivity.
My noble friend Lord Risby remarked on broadband in relation to SMEs and micro-businesses. The Government are working hard to put the UK at the forefront of the digital revolution and are committed to 95% of UK premises having access to superfast broadband by 2017. Five community projects are currently being funded to help improve connections to remote locations. My noble friend Lord Freeman mentioned commercialising ideas in Cambridge. I will write to him on the points he raised. Many ideas in the technology sector in Cambridge are supported by venture capital, which was mentioned by my noble friend Lord Leigh. Angel networks play a particularly important role in providing finance and guidance to small businesses in some of our fastest growing industries.
In summary, there were a record 5.2 million private sector businesses at the start of 2014. That is an increase of 760,000 compared with the start of 2010. At the start of 2014, small businesses employed 15.2 million people, 60% of total UK private sector employment. The Government have worked hard to support small businesses. Time has prevented me from mentioning many other initiatives, such as local enterprise partnerships, but we know there is more to do. The Government are committed to fostering and assisting the entrepreneurial spirit that thrives in the UK. We have continued to lead the way in our support of small businesses because we want to make Britain the best place in the world to start and grow a business.
I have covered a few of the questions that were raised, although not every one. My noble friend Lord Risby asked whether the Government will review the structure of business rates. We will report by Budget 2016 and the Government will publish terms of reference in due course. We will certainly review it. My noble friend was right that in some cases the rates exceed the rent. My noble friend also raised the issue of prompt payment. We are improving public sector payment practices through the Small Business, Enterprise and Employment Bill.
Once again I thank my noble friend Lord Risby for initiating this debate and all noble Lords who took part in it.
Deregulation Bill
(9 years, 10 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Lord Clement-Jones
“( ) After subsection (4) insert—
“(5) Governing bodies of schools seeking to make changes to dates of term and holiday times will so far as practicable consult local tourism organisations prior to determination.””
Lord Clement-Jones (LD)
My Lords, I will not recap at length the points I made in Committee. Suffice it to say that tourism contributes 9% of all UK GDP and 9% of all jobs: 3 million people rely on it for work. Domestic tourism spending is a significant portion of this—79% of tourism spending across the UK. I made the point in Committee that domestic changes in school term times have a potentially massive knock-on effect for the UK tourism industry as a whole. In the US, there are numerous examples of states changing term times and the huge effect that has had, costing state economies hundreds of millions of dollars annually.
DCMS has admitted that there has been no evaluation of the policy’s effect on tourism. Tourism is heavily reliant on the weather, and it is not uncommon for summer trading to be ruined, for example, by two weeks of bad weather. Decreasing the length of the summer holiday to, say, four weeks would be far more devastating than a simple one-third reduction of the peak period. Diversifying the dates of holidays does not lengthen the peak period but simply spreads out the same trade while increasing operating costs.
Assurances have been given to the British Association of Leisure Parks, Piers and Attractions—BALPPA—by the Department for Education, and indeed by my noble friend in Committee on 6 November, that the needs of businesses will be considered. However, does this actually amount to an assurance that consultation will take place before changes are made? Surely, at the very least, the duty to do so should be contained in guidance or, much better, enshrined in the Bill.
By their nature, tourism attractions bring people in from beyond the immediate locality. Often, they attract people into towns from the region and beyond. Changing school times throughout the whole of Manchester would, for example, affect attractions across the north-west, including those in Blackpool and Liverpool. There is concern that when schools want to use these powers, they will not have the concerns of local businesses in mind. We need to give the tourism industry more confidence in this legislation, which is viewed with a great deal of concern at the moment. The effect of changes to school terms and holidays is potentially huge for the industry. We should therefore make sure that school governing bodies consult when they propose to make any such changes. I urge my noble friend to accept the principle of this amendment and I beg to move.
Lord Stevenson of Balmacara (Lab)
My Lords, I have a great deal of sympathy for what the noble Lord has just said. Indeed, we discussed this at some length in Committee. I have only one point and when the Minister responds I would be grateful if he could expand on the comments that he made in Committee. He said:
“I am happy to assure the noble Lord that the Government have agreed that their advice to schools will make clear that: schools should be considerate of the needs of parents and impacts on others by working with each other and the local authority to co-ordinate term dates as far as possible; and that all schools must act reasonably when setting term dates, including considering the impact of changes to term dates on small businesses that rely on tourism from families with school-age children”.—[Official Report, 6/11/2014; col. GC771.]
That is a very targeted comment and seems in many ways to answer everything that the noble Lord was saying, but I wonder what force this advice will have? Will it be in the form of a circular of some type? Can he expand on that? Will there be any sanctions for those who do not behave to the letter of the law, as so well expressed by the noble Lord the last time round? Particularly, would Ofsted be inspecting such offers made by schools?
Lord Wallace of Saltaire (LD)
I thank the noble Lord for those splendid comments. It is wonderfully nostalgic to read some of the material around this amendment. The British Association of Leisure Parks, Piers and Attractions has sent me something that particularly mentioned Skegness, Hunstanton and Cromer. Those of us who, like, me can remember swimming off Skegness as a boy, will also remember trying to pretend that it was not as bitterly cold as it was. My children later gave me the LNER poster that used to hang in my room when I was an academic, saying “Skegness is so bracing”. That took me back to what as children we used to have as holidays, before the foreign holiday idea began to creep up on British families and affluence took us further away.
The Government believe as far as possible in devolution and autonomy, and we are providing advice to schools. This is not something that Ofsted is imposing on them, let alone is it an English Parliament deciding that English schools must each have the same holiday.
Lord Stevenson of Balmacara
I cannot resist. Is the Minister saying that it is now Government policy to have an English Parliament?
Lord Wallace of Saltaire
No, I was perhaps making an after-dinner remark that was a little outside my brief.
Those of us who live in the north of England are well aware that different local authorities have had different holiday periods for a long time. Blackpool would not have had the prosperity that it had if wakes weeks had not been staggered across Lancashire and Yorkshire in the 19th century. There was a degree of adaptability among different local authorities that worked extremely well. It is no longer necessary.
In arguing that the proposed amendment to Part 3 of Schedule 15 is unnecessary, I should therefore say that schools and local authorities have had a considerable degree of autonomy to change their holiday times in recent years. Very few have wished to do so, because there are powerful arguments for the existing system. School leaders are best placed to decide the structure of the school year in the interests of their pupils’ education and local circumstances. Schedule 16 therefore gives all schools responsibility to set their own term dates from this September.
Thousands of schools, educating more than half of all registered pupils, are already responsible for their term dates. Three-quarters of secondary schools and more than a third of primary schools are already responsible for their school year. There is a school in every local authority in England with this freedom, but without the proposed specific requirement, suggested by the noble Lord, to consult tourism businesses in place. This has not resulted in significant problems for the tourist industry. In practice, the majority of schools continue to follow their existing term dates, with a small number making changes where there is a compelling reason to do so. Where they make changes, schools take into account the needs of the local community. As noble Lords will be well aware, the needs of the local community in cities such as Bradford or Manchester often include the different patterns of different religious and ethnic communities.
Turning to the concern at the heart of the amendment, all schools must already act reasonably, fairly and transparently when determining term dates. This will include considering the impact on those likely to be affected by their decisions, including pupils, parents, staff, the local authority and businesses.
Lord Clement-Jones
I am sorry to interrupt my noble friend, but these are very important details. Can he give me chapter and verse as to where these obligations to act reasonably, fairly, et cetera, arise?
Lord Wallace of Saltaire
My Lords, it may be somewhere deep in my brief. I am sure it is somewhere deep in the Box. If I go on for a short period, I am sure that the answer will magically appear for me. I am fairly sure it is in briefing and guidance. It is not something that is enforced upon schools because that does not seem necessary. When my children were in primary school in the early years of a Labour Government, I recall the head teacher of the primary school commenting that he received volumes and volumes of instructions each year on how to behave. We rather think we should try to avoid quite such a deliberate effort if we can.
The Government understand the noble Lord’s concern that it may not be immediately obvious to a school that its decision to change term dates could affect local tourism businesses. The Government have discussed this point with BALPA and agreed to assurances in the form of advice to schools. It is a general principle of law, I am assured, that is provided in guidance to schools, but we will write to the noble Lord with the exact chapter, verse and places where this guidance is set out.
I am pleased to reiterate that the Government have agreed that their advice to schools will be clear. Schools should be considerate of the needs of parents and the impacts on others by working with each other and the local authority to co-ordinate term dates as far as possible, and all schools must act reasonably when setting term dates; “reasonably” includes the impact of term dates on small businesses that rely on tourism. I will write to the noble Lord with the exact details of where the guidance is provided and the experience so far. I reiterate that the freedom that schools have had so far to alter term dates has not led to a huge revolution because the pattern of terms and holidays suits most parents, staff, businesses and others much better than any alternatives. With that assurance and my repetition that we are conscious of the way in which the short British summer and the needs of British tourist institutions interact with schools and school holidays, I hope the noble Lord will be able to withdraw his amendment.
Lord Clement-Jones
My Lords, as I am sure my noble friend is very well aware, Groundhog Day was celebrated yesterday in the United States. I felt that perhaps we were beginning to celebrate Groundhog Day here in the House today. Until the very last point of my noble friend’s response, I felt that the response he gave me was pretty undercooked, quite honestly, as if the Department for Education had disinterred something from two months ago which was more or less in the same form. It did not have the detail that one might require on Report to an amendment that is much more specific than the one that was put forward in Committee. I really feel that it has not been given the seriousness that it should have been, and that the Department for Education, for which in this context my noble friend is speaking, is not really taking the concerns of the tourism industry seriously.
I fully understand the case that my noble friend is making, that to date we have not seen a great impact on local attractions and so on, but that is not the issue. The issue is the potential impact, and it is only by addressing the concerns of local tourism interest, by consulting with them and so on, that one is really going to be able to understand that.
Lord Wallace of Saltaire
My Lords, we have not so far seen any problem, and if the noble Lord’s criticism may be that the DfE is not paying enough attention to this problem, that is partly because it is not a problem.
Lord Clement-Jones
My Lords, as I said, my noble friend has made the case that there is no existing problem, but the industry is extremely concerned that it could be a problem in future, because this will mean that the full range of schools—as opposed to a number of schools—will be able to change their term times by the decision of governing bodies. What the industry is quite reasonably asking is that the duty on school governing bodies to consult should be enshrined in law. My noble friend says, “It’ll be all right on the night, because they have a duty to act reasonably and fairly”, under something or other—whether it is guidance, advice or some other sort of way, no doubt, of communicating between the Department for Education and schools, I know not what. I look forward to my noble friend’s specific reply, which will be extremely helpful.
Lord Wallace of Saltaire
My Lords, just to add, in a Deregulation Bill, the Government are a little hesitant about imposing a new national regulation unless there is a good rationale for it. We have not yet seen the rationale.
Lord Clement-Jones
My Lords, my noble friend was talking about an existing set of guidance advice, not something happening in future. Therefore, it would be extremely useful to know whether this is an umbrella set of guidance, which means that the concerns of BALPA and others should be entirely satisfied by a duty to act fairly and reasonably—then I shall be extremely happy. But no specifics have been given. I look forward to hearing about them.
I am rather disappointed by my noble friend’s reply, I think that something more specific could have been given, but in the mean time I look forward to the letter and beg leave to withdraw the amendment.
“(5A) The alcohol must be sold for no less than fifty pence per unit.”
Lord Brooke of Alverthorpe (Lab)
My Lords, I shall speak also to Amendments 24, 25 and 26. I start by expressing my gratitude to a range of people and organisations who have been in touch with me since I spoke to a series of amendments in Committee, and my thanks to those who have put their name to these amendments today, particularly the noble Baroness, Lady Finlay, who managed to fly here from abroad to speak in this debate. The people who put their names down represent a substantial concerned body of health interests who are convinced that MUP—minimum unit pricing—is needed in England as well as Scotland, where people are trying to press it through. We also hear that the Welsh Government are now embracing and seeking to implement it. Its aim is to minimise alcohol harm to people’s health and harm to the NHS by reducing NHS costs, to cut public disturbances and the cost to the criminal justice system, to reduce domestic violence, to reduce accidents at work and on the roads, and to reduce—this is an important point—the hidden sugar in alcohol, which is quite a big contributor to the major health problem facing us, the growth of obesity in this country, a growth which has taken place significantly under this Government.
The argument for this change was made by the Government in a well produced alcohol strategy that they issued in 2012. Regrettably, when it came to the crunch, the Government ran away from the tough decision. They talk about taking tough decisions, but they have run away from this one, even though there is mounting evidence and support for it on a very wide front. I am particularly pleased that the Church of England is in favour in principle, and I am grateful to the right reverend Prelate the Bishop of Carlisle, who regrettably cannot be with us because of a prior engagement but wished to speak strongly in favour, from the position of one of those who would be affected by this change in legislation.
On the new licensing regime that will cover community and ancillary businesses, I should express a word of gratitude to the Government. Following our debates in Committee, they ran a public consultation—there had not been one previously. In a sense, that was in recognition that this was not a deregulatory change, as I had argued, but a matter for new legislation. I think that this led them to recognise the need for a public consultation in November and December. Had there been a bit more time for that consultation, some of us would have been happy to give the Government some suggestions on how it might have been better run than was the case, but none the less they did it and it would be churlish if I did not express my gratitude to them for it.
One area that some of us—I have in mind other groups here—would have focused on would be establishing a basis for enforcing the scheme. Local government would have liked to have had proper powers to police it and ensure that it is effectively put in place. While the Government have suggested that a certain maximum number of units should be consumed by people participating in such events around the country, quite frankly, as we all know, there is no way in which one could enforce that if they exceed it or even supervise what is happening.
Minimum unit pricing at such events, which would put the cost of a unit of alcohol at a higher level than perhaps would normally be charged, could be seen as a restraining factor to try to limit the amount of drinking taking place—they could be events in communities, charities or in church affairs and so on. I should advise the Government that, if they were prepared to embrace this change, they would be well supported by a number of councils around the country. All 12 councils in the north-east of England want MUP introducing because of the problems which they encounter. They have written to me giving support to the amendments that I am proposing. They range from the councils in Newcastle, Middlesbrough and Durham—the big ones—to which then can be added, moving across to the other side of the country, all the councils in Greater Manchester, Lancashire Council and Leeds Council. Coming further south, Birmingham Council, too, is now pressing for MUP to be introduced because of the problems which it faces in the health service and with disturbances related to the criminal justice system. I understand from the Local Government Association, which has been giving me advice on this matter, that while many other authorities in other parts of the country have not as yet come out in favour of the principle of MUP, they are privately in favour of it and in due course will go on record as saying that they need it soon. These issues need to be taken into account in the context of what I am pressing for tonight.
I have also heard from numerous charities, which will qualify under the CANs for this form of licensing, saying that they would be very happy to be running minimum unit pricing. So we have a group that ranges over local authorities with their links, charities and the Church of England. I have also had conversations with the National Federation of Women’s Institutes, which was much quoted in debates in the Commons on where it stood. It does not have an official policy on MUP, but I guess that in the light of some of the arguments now being advanced by people of like mind on a wide front—the people who were prayed in aid so much in the Commons—the women’s institutes may come on board, too.
As well as upholding the principle of containing the amount of drink that people consume, all such groups see that there would be a benefit for them in having a higher yield from applying minimum unit pricing than perhaps they have had hitherto. They buy cheaper from the supermarkets and then sell at the higher rate there. It is a win-win situation as far as many of them see it, and one of the reasons why—as they are financial beneficiaries as well—they would be glad to see this come into practice.
Baroness Finlay of Llandaff (CB)
My Lords, I am grateful to the noble Lord, Lord Brooke of Alverthorpe, for introducing this group of amendments so clearly. They are amendments to which I wanted to add my name because alcohol is putting an intolerable strain on the NHS. There is no getting away from that.
We have 1 million hospital admissions a year related to alcohol. We all know that there are peak times in A&E departments when alcohol problems swamp departments. It is not at all times of the day but we also know that other parts of the NHS are put under chronic and severe strain because they have to deal with alcohol-related diseases. In fact, there are about 60 different medical conditions where excessive consumption significantly causes morbidity and premature death in the UK.
I declare that I am president of the BMA. At a recent BMA meeting a breast surgeon came up and begged me—I do not exaggerate—to do something about excessive alcohol consumption because he has seen more and more middle-aged women who have chronically high levels of alcohol consumption and then develop obesity and breast cancer. He said it is reaching epidemic proportions and that he has seen a significant change over recent times.
I return to the topic of the amendments. As well as the strain on the NHS the cost to the whole country is significant. The cost to the NHS has been estimated to be almost £4 billion a year, which equates to about £120 a year per taxpayer. The overall cost to the country is nearer £26 billion a year, which is between fivefold and sixfold, so I have estimated that this is probably about £750 per taxpayer, because we do not have a really comprehensive and effective alcohol policy at the moment.
The ban on selling alcohol below cost price, which came into force last May, is not, as far as we have been able to see, significantly reducing drinkers’ mean annual consumption. It is not really surprising. It was calculated that mean annual consumption would decrease by less than 1% overall. Minimum unit pricing has been shown in different models to have an effect and it stops higher alcohol-content drink being sold disproportionately cheaply and you get a more balanced spread of the way drinks are purchased and taken. The relative underselling of cider against beer, where cider has a higher alcohol content, becomes balanced out and the high consumption of spirits in particular, which have a very high unit content, then becomes spread across the spectrum of price.
It has been suggested that minimum unit price would unfairly impact responsible drinkers. There does not seem to be any strong evidence for that at all, but it will impact on irresponsible drinkers. It has been estimated that a minimum unit price of 50p would have major benefits. For example, it has been estimated that there would be more than 97,000 fewer hospital admissions a year, more than 42,000 fewer crimes, nearly 30,000 fewer cases of unemployment and more than 442,000 fewer episodes of absenteeism from work, which is frequently an alcohol-related problem. As we all know, it tends to occur on the days after high days, holidays and weekends. The saving on healthcare costs alone has been estimated to be £1,591 million a year. That is a significant amount of healthcare funding that can then be diverted to meet the needs of others.
There has also been evidence that increasing the price of alcohol reduces the rate of alcohol-related harms including violence and crime, deaths from liver cirrhosis, other drug use, sexually transmitted infections and risky sexual behaviour, as well as drink-driving deaths.
The impact of drinking is not only on the individual, of course, but also on all those who are bereaved, such as children who lose parents at a premature age. It also affects those who are on the receiving end of abuse and of violence and high alcohol consumption is also associated with high rates of suicide.
As a doctor, I fail to see why any Government have not grasped what would seem to be a fairly straightforward solution to a major social problem by implementing minimum unit pricing so that responsible drinkers could buy their drinks as they do now but those who want to buy to binge—and who then end up in A&E incurring large costs or damaging others through their irresponsible behaviour—would be deterred from being able to do so. The chronic overconsumption we are seeing in today’s world would also be affected because if you make alcohol a bit too expensive you build in a deterrent to drinking too much.
Baroness Hayter of Kentish Town (Lab)
My Lords, it is perhaps fair to say that four years ago this amendment would have been tabled by the Government, as David Cameron was at that point in favour of minimum unit pricing, not necessarily at 50p but perhaps at 60p or some other figure. Given the Government’s change of heart on that, we have instead the amendments tabled by some of the country’s greatest experts on the damage caused by alcohol: two eminent doctors, a bishop who sees the problems caused to families as well as to the health of heavy drinkers themselves, and my noble friend Lord Brooke of Alverthorpe, who has campaigned for so many years on this issue.
We debate this on the day that Professor Neil Greenberg, the lead on military health at the Royal College of Psychiatrists has said that the Government’s strategy for combating alcohol abuse in the Armed Forces is ineffective. As he says,
“we know that alcohol education doesn’t really work at all, and the evidence from the civilian population is that it’s a terribly ineffective way of stopping people from drinking”.
His words echo those of the Commons Defence Select Committee that the Government’s strategy has not made any noticeable impact on the high levels of excessive drinking in the Armed Forces. Critics argue that the problem is made worse by prices of less than £2 a pint in some military bars. That is, of course, £1 per unit for regular beer, but this amendment seeks a minimum of only half that amount.
Price by itself is, of course, not the answer, as my noble friend Lord Brooke said, and Labour has a wider vision for reducing alcohol-related harm. We want communities to be able to stop their high streets being overrun with new bars and a licensing system which enhances the voice of local communities in licensing decisions. We should look at whether councils should have more power to strengthen conditions on licensed premises and, importantly, we want to make public health a mandatory factor to be taken into account in all licensing. However, this was rejected by the Government when we proposed making public health a licensing condition in 2011.
Although at present local authorities can take account of the prevention of crime or nuisance, public safety and child protection in deciding on licence applications, they cannot consider public health consequences. Labour would make public health a licensing objective and include the director of public health as a key consultee in the creation of a licensing statement. We want public health engrained throughout the licensing system so that measures promoting health, which could include action against high-strength, low-cost products, are included in the licensing statement, and we want to tackle the public health problems associated with drinking by children, some of whom will be at the very functions at which the clause allows alcohol to be sold.
I look forward, as ever, to hearing the Minister trying to wriggle his way out of David Cameron’s decision to drop his commitment to minimum unit pricing. While he is on his feet, perhaps he could also explain why the Chief Medical Officer’s review of safe drinking levels, which was promised in the summer, has yet to appear. Perhaps that is another ducking of the issue. Most of all, I would welcome his assurance that, with hindsight, the Government accept the case for public health being a licensing consideration and his support for that objective.
Lord Wallace of Saltaire
My Lords, as I was having my supper, with my glass of water, it occurred to me that when I first joined the House of Lords, we often had the phenomenon of the after-dinner speech in which someone, very often from the Conservative side of the House, would deliver an extremely florid speech with high rhetorical flourishes. This Chamber has improved quite considerably over the past 15 years in its attitude to alcohol.
I am sorry to have to tell the noble Lord, Lord Brooke of Alverthorpe, that my noble friend Lord Gardiner tells me that President Putin has just announced that he is lowering the duty on alcohol in Russia, presumably for the reason that alcohol is what people wish to take refuge in when they are miserable for all sorts of reasons, and there are a lot of reasons why people in Russia are miserable at present.
Baroness Hayter of Kentish Town
Or perhaps elections are coming, as they are in this country.
Lord Wallace of Saltaire
I was not aware that the Government were thinking about lowering the duty.
The Government recognise that the whole issue of alcohol abuse is a very serious one for this country and that it feeds into public order, public health and a whole range of other issues. I travel into Leeds on Saturday nights, and there are many other cities in Yorkshire where, of a Saturday evening, I often wonder whether the younger generation will die of alcohol abuse or hypothermia first, since they wear almost nothing when they go out on to the streets. I do not know how on earth they manage to get drunk and not break their ankles when their shoes are so impractical. That is the sort of problem we face. I recognise, as the noble Baroness, Lady Finlay, remarked, that we have a growing middle-age—or even over-middle-age—problem, but that binge-drinking among the young is one of the problems we have, and it feeds directly into A&E late on Saturday evening. I spent an afternoon with Leeds city police during which all that was made very firmly clear to me.
On the question of selling liquor below cost price, I think we are all aware that supermarkets are the biggest single part of the problem, as they sell loss leaders and cheap alcohol, be that cheap wine or cider below cost price. My answer on this set of amendments to this Bill is that, while I recognise the argument which we all need to have about how best to pursue further the Government’s alcohol strategy, and how we move towards minimum unit pricing, this is not the place to do it. Here, we propose relaxation in two specific small areas. The first is that of small hotels and bed and breakfast accommodation, where we are talking about a nightcap in the evening, which would probably be included in the overall bill—so at that point the question of the price is hard to get at. Then there are events of the sort which I occasionally go to in village barns or community centres, which usually have licences that allow them to sell alcohol only 12 to 15 times a year, when there is a community event. Therefore we are dealing specifically with ancillary sellers and community groups. That is not where alcohol problems come from.
In the part of Yorkshire in which I spend my weekends, there is a great revival of brewing, but of good-quality beer, which is not the sort of thing people get wildly drunk on. On a very cold Saturday last weekend, I asked whether the pub I had gone into had any “winter warmer”—which has a rather higher level of alcohol one can get at this time of year. However, they said, “No, we don’t brew that any longer”, but then offered me a great variety of extremely tasty local 3.5% beers, of which my wife and I consumed a certain amount. That is light years away from the problems that we have with large-scale alcohol abuse. Of course, the third element of alcohol abuse is abuse by those who are mentally disturbed or depressed, which is the Buckie or cheap cider end of the market.
I stress that the Government have not abandoned their alcohol strategy; minimum unit price was only ever part of that strategy. The noble Lord is right to say that the Government are watching the appeal in Scotland and waiting until that has been settled before we move further on minimum unit pricing within England. The Scots Government are themselves awaiting the outcome of the ECJ appeal. As an interim measure, the Government have introduced a ban on selling alcohol again in supermarkets—the biggest single part of the problem—below the cost of duty and VAT combined. Some were selling it as a loss leader below that level. The University of Sheffield has estimated that, in the first year of the ban on sales below duty plus VAT, there will be 100 fewer alcohol-related hospital admissions per year—and, as it got under way, 500 fewer per year, 14 fewer alcohol-related deaths per year, and so on. That is small beer—if noble Lords will excuse me—and a small achievement compared with what minimum alcohol pricing may offer, but it is a small step in what I hope noble Lords will recognise is the right direction.
Alcohol abuse is a real problem for this country. The question of alcohol pricing—in particular of loss-leader pricing—is one which we are much concerned about. This is not a matter for bed and breakfast and community events. It is a matter for city centre clubs at the weekend. It is a very serious matter for supermarkets. That is the direction in which the Government are looking. Therefore, on this particular issue, I cannot give the noble Lord much comfort, because we are dealing here with social drinking of a moderate level. The case where we need to look at minimum unit pricing and alcohol abuse is in a much broader context and in a different context from the average bed and breakfast in Upper Airedale or Upper Wharfedale, which is what we are talking about here—let alone the village barn in Cotterstock, or wherever it may be. For that reason, I am unable to satisfy the noble Lord on this issue.
Nevertheless, I recognise the deep concerns the noble Lord has about the alcohol issue as a whole. I would love to talk further with him about the development of alcoholic sorbets—which, I have to say, I have never yet seen, let alone tasted—and how those are being promoted. As we know, there are also some very serious concerns about the combination of sugar and alcohol in pop drinks for young people, which combines alcohol abuse and the making people obese at the same time. Let us continue to discuss those issues further. Those are the areas on which an alcohol abuse strategy needs to focus—not, I suggest, bed and breakfasts or community barns.
Lord Brooke of Alverthorpe
I am grateful to my noble friend Lady Hayter for her helpful words in the debate, and to the noble Baroness, Lady Finlay, who, as ever, is standing up and fighting the just battle that needs to continue to be fought. The Minister, in some respects, talked about movement and shifts towards a change in policy, which is gratifying. He made reference to what some of the Conservative speeches were like in the old days. It is quite interesting that when the Government have a Prime Minister who wants to do an about-turn, both in the Commons and in the Lords they put up Lib Dem Ministers to defend the position. They should reflect on that, given the association of the Lib Dem party with so many of those councils that I mentioned, which are now pressing for this change. But, as noble Lords would expect, I am not surprised that the Minister has declined to accept what I think is a civilised and reasonable offer for them to make a start. The real problem with this change is making the start. I freely concede that it is a precise area in which it would operate, and it may not be the major problem that we would face with alcohol.
The alcohol problems are not solely about Saturday evenings in city centres. They are increasingly prevalent right across the board, particularly with middle-aged people upwards, who are precisely some of the people who go to these community events—that is, recently retired people in their 50s and 60s. These people are now of increasing concern in terms of health issues, as the noble Baroness, Lady Finlay, will confirm. There is a hidden growth in the incidence of diabetes linked to alcohol consumption because nobody knows the amount of sugar contained in the alcohol these people are drinking. No calorie or sugar content is shown on the labels. So far the drinks industry, which this Government support, has managed to avoid having to display that on its labels, yet we have a major obesity problem arising linked to the sugar content of alcohol.
I thought that I made the Minister an offer that was too good to turn down given that a group of people is willing to make a start on tackling this issue. Indeed, they are the kind of people who the Government normally worry about penalising when they decide to do an about-turn. They are the people running these organisations, particularly the community events—not so much bed and breakfast—who were prepared to embrace this change and see whether they could make it work. They would be happy to support it in principle and would benefit from it. I am sorry that the Government have not recognised the benefit of making a start on this issue. I will reflect on the Minister’s comments in Hansard and, following consultation with others, we will decide how we proceed at the next stage. I beg leave to withdraw the amendment.